Commons Sitting of 29 March 1983

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRIVATE BUSINESS
  BRITISH RAILWAYS (LIVERPOOL STREET STATION) BILL
  Lords amendments agreed to.
  COMMONS REGISTRATION (GLAMORGAN) BILL
  Read the Third time, and passed.

  CONTINGENCIES FUND 1981–82
  Account ordered,
  of the Contingencies Fund, 1981–82, showing:—

  (1) the Receipts and Payments in connection with the Fund in the year ended the 31st day of March 1982;

  (2) the Distribution of the Capital of the Fund at the commencement and close of the year; with the Report of the Comptroller and Auditor General thereon.—[Mr. Cope.]

Oral Answers to Questions
  DEFENCE

    Nuclear Weapons
    Mr. Raceasked the Secretary of State for Defence if he will now answer parliamentary questions on the number of nuclear warheads possessed by the United Kingdom, the United States of America, and the Union of Soviet Socialist Republics, respectively.
    Mr. Chapmanasked the Secretary of State for Defence what is his latest assessment of the numbers of Russian nuclear missile warheads targeted on western Europe.
    The Secretary of State for Defence (Mr. Michael Heseltine): It has not been the practice of the United Kingdom, United States or Soviet Governments to reveal the numbers of nuclear warheads in their stockpiles. Comparisons of the numbers of nuclear delivery systems deployed by NATO and the Soviet Union are set out in figure 7 of the "Statement on the Defence Estimates 1982". We estimate, however, that in the intermediate range alone the Soviet Union possesses 351 SS20 missiles with 1,053 warheads, and that approximately two thirds of these face western Europe, together with about 250 warheads on the older SS4 and SS5 missiles.
    Mr. Race: Is it not one of the Secretary of State's basic functions to hide the truth from the people? Given the answer that he has just provided, is it not true that he has neglected the fact that there is already massive overkill among the nuclear super powers and that, taking all warheads together—strategic, theatre and tactical—the West has the majority of warheads? If those facts were known, would not more people join the CND than ever before?
    Mr. Heseltine: It is astonishing that the hon. Gentleman believes that we live in a society that tries to hide the facts from the people. He must be fully aware that only three and a half years ago his party was in full possession of all the information that is available to me and believed categorically then that it was necessary to have nuclear weapons and to modernise them.
    Mr. Chapman: Will my right hon. Friend confirm that during the past five years the number of Russian nuclear warheads targeted on western Europe has increased by 400 and that during a similar period there has been a reduction on our side of no fewer than 1,000? Is not cruise a replacement for more obsolete weapon systems as well as a response to the deployed SS20s?
    Mr. Heseltine: I confirm that the Americans have withdrawn 1,000 nuclear warheads from Europe during the period to which my hon. Friend referred. Without matching the figure of 400 that he mentioned, I can tell him that since March 1982, 54 SS20s have become operational at six completed bases. The cruise missile system is to be deployed in western Europe in response to the large number of SS20 missiles that have been deployed and face this country.
    Mr. Newens: Will the right hon. Gentleman stop dodging the question? If one takes strategic and theatre

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    nuclear weapons together, in terms of targeted warheads has not the West more than the Soviet Union? Will he answer that question? Will he deny those facts if they are not true?
    Mr. Heseltine: The hon. Gentleman will be fully aware that all these matters are the subject of discussion—[HON. MEMBERS: "Answer."]—at the disarmament talks which are proceeding and which we support strongly. If the Soviet Union is genuinely interested in reducing the numbers of those warheads, it is the Western powers' priority to achieve that aim.
    Sir John Biggs-Davison: Is it not contemptible and immoral for the Labour party to say, as it does in "Labour's Plan", that it is not opposed to the existing Alliance, but wishes to abandon nuclear defence? Is it not utterly contemptible that it is prepared to accept the protection of the American deterrent, but is opposed to the British deterrent?
    Mr. Heseltine: My hon. Friend has raised a critical issue, about which we have far greater information today with the publication of the latest defence statement of the Labour party. Broadly, it says that it wishes to undermine the basic defence policy that has guaranteed the peace of western Europe for the past 37 years. It wishes to see the end of the NATO Alliance. It wishes to remove Polaris—
    Dr. McDonald: No.
    Mr. Heseltine: Yes. The words for which I search say that the Labour party wishes to see—[Interruption.] I have not found the words, but they are in the document that has been handed to me. The Labour party wishes to see the end of the NATO Alliance and the Warsaw Pact Alliance. I have now found the words. It says:
    "The ultimate objective of a satisfactory relationship in Europe is the mutual and concurrent phasing out of both NATO and the Warsaw Pact."
    The idea that this country's defence policy can depend upon support from NATO, which is supposed not to have nuclear support from this country, is incredible and would lead to the disintegration of the NATO Alliance. The Labour party—
    Mr. Speaker: Order. That is too long an answer. [HON. MEMBERS: "Hear, hear."] Order. I must tell the House that if there are to be long supplementary questions I shall call only one hon. Member and move on, because long questions are not fair to others whose names are on the Order Paper.
    Mr. Denzil Davies: Instead of indulging in his normal politics of gimmickry, the Secretary of State should brief himself properly before he comes to the House. He will know, or his civil servants will tell him, that the last Labour party conference voted overwhelmingly, by more than a two thirds majority, to stay in NATO. Is not the important fact that the Soviet Union and the Western Alliance could destroy each other 50 times over with the warheads that they now possess and that the real priority—I am sorry that the Secretary of State is so insensitive to this—is to freeze nuclear weapons and reduce them so that the world can become safer and saner?
    Mr. Heseltine: If the real priority is to reduce nuclear weapons, why did the Labour Government, four or five
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    days before polling day, say that it was essential to maintain nuclear deterrence and to modernise the weapons systems we had?
    Mr. Hooleyasked the Secretary of State for Defence what is Her Majesty's Government's policy on the deployment by the North Atlantic Treaty Organisation of tactical battlefield nuclear weapons in central Europe.
    Mr. Meacherasked the Secretary of State for Defence if he will estimate the number of short-range battlefield nuclear weapons deployed on each side in Europe.
    The Minister of State for the Armed Forces (Mr. Peter Blaker): NATO maintains a range of nuclear forces geared to the Alliance's strategy of flexible response. At present the Warsaw Pact has approximately 650 short-range nuclear missiles and about 300 nuclear-capable artillery tubes deployed in Europe. NATO has 100 comparable missiles and about 1,000 nuclear-capable artillery tubes. The Alliance is currently examining the size of its nuclear stockpile in Europe with a view to ensuring that the size of the stockpile is set at the minimum level consistent with effective deterrence.
    Mr. Hooley: Is the Minister aware that a NATO commander recently said that those battlefield weapons were obsolete, dangerous and unusable? Therefore, would it not be sensible to remove them as a step towards attaining a nuclear-free Europe?
    Mr. Blaker: I do not know to which NATO commander the hon. Gentleman is referring. I do not know of any authoritative statement to that effect. However, it is true that the Alliance is examining its stockpile of battlefield nuclear weapons to see whether they are all necessary.
    Mr. Meacher: Is it not the case that those large numbers of short-range battlefield nuclear weapons deployed throughout central Europe could be used outside direct political control in the event of a breakthrough by Warsaw Pact conventional forces? Does not that pose by far the greatest threat of an outbreak of an uncontrolled nuclear escalation in Europe? What steps is the Minister taking, together with the Foreign Office, to bring about negotiations on the withdrawal of short-range battlefield nuclear weapons to complement the START and INF talks that are taking place in Geneva?
    Mr. Blaker: The hon. Gentleman's first premise is wrong. Those weapons could not be used without political control. With regard to a battlefield nuclear weapon-free zone, I refer the hon. Gentleman to the answer that I gave to the hon. Member for Caithness and Sutherland (Mr. Maclennan) on 1 March about the consideration that we are giving to that proposal and the disadvantages that we see in it.
    Sir Neil Marten: If the West has withdrawn 1,000 missiles, as my right hon. Friend the Secretary of State has just said, how many have the Russians withdrawn?
    Mr. Blaker: As far as I know, none, Sir.
    Mr. Denzil Dailies: Is not the real problem that the NATO strategy of first use of nuclear weapons, which is what it is, is totally unrealistic? Should not the Government, instead of engaging in attacks on people who are campaigning for peace, campaign within NATO to

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    eliminate the battlefield nuclear weapons and move away from the policy of first strike to a policy of no first use of nuclear weapons?
    Mr. Blaker: I shall amend the reply that I gave to my hon. Friend the Member for Banbury (Sir N. Marten) and add that the Soviet Union has withdrawn some of its more obsolete weapons, but has replaced them with more modern ones. With regard to no first use of nuclear weapons, we have a much better policy, which is no first use of any weapon, nuclear or conventional. We shall never use any weapon unless we are attacked. We are a defensive Alliance and threaten nobody. The Soviet Union's declaration about no first use of nuclear weapons in part reflects the Soviet Union's confidence in its superiority in conventional weapons, and, what is more, it is unverifiable.
    Mr. Cyril D. Townsend: Will my hon. Friend confirm that the reason why NATO deployed tactical nuclear weapons in western Europe was that the Soviet Union had a predominance of 3:1 in armour, a massive number of artillery weapons, and had organised its defence industry on a war footing? If the Soviet Union wishes to see a better understanding between East and West, perhaps it could scale down the size of its conventional forces deployed in Europe.
    Mr. Blaker: My hon. Friend is absolutely right. The figures have frequently been quoted in the House. The Soviets have, in addition, overwhelming superiority in intermediate range nuclear forces.

    Type 23 Frigate
    Sir Patrick Wallasked the Secretary of State for Defence if he will report the progress of the design for the type 23 frigate.
    The Under-Secretary of State for Defence Procurement (Mr. Ian Stewart): I have nothing to add to the reply that my predecessor gave to my hon. Friend on 16 November 1982.
    Sir Patrick Wall: Will my hon. Friend at least assure the House that those vessels will be armed with both surface-to-air and surface-to-surface missiles as well as the helicopter and towed arrays? Are the lightweight Sea Dart and the lightweight Sea Wolf being considered for those vessels?
    Mr. Stewart: In the debate in December last year my right hon. Friend the Member for St. Ives (Sir J. Nott) gave a list of the weapons systems which the ship would carry. I have nothing to add to the information that he gave at that time.
    Mr. Stephen Ross: Is it true, as is rumoured, that the prototype type 23 sank?
    Mr. Stewart: I do not know what the hon. Gentleman is referring to.
    Mr. Jay: Would it not be more sensible to use our money to re-equip our Navy properly than to lend our money to the Argentines to re-equip theirs?
    Mr. Stewart: I do not know whether the right hon. Gentleman was in the House last week to hear the effective answer by my right hon. Friend the Prime Minister when that point was raised. The very stringent conditions that
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    are attached to international loans will make it more difficult, not easier, for the Argentines to spend money on offensive weapons. With regard to the equipment of the Royal Navy, I am glad to say that the type 23 and other ships that we now have in design and on order w ill improve our capability.
    Mr. Viggers: Can my hon. Friend bring us up to date on the trials of the broader shorter hull, as opposed Ito the narrower longer hull, particularly in view of the interest that has been expressed in the concept of the broader shorter hull in the United States?
    Mr. Stewart: I have, indeed, learnt of the new design that is under consideration for the United States Navy. With regard to alternatives for the type 23, the opportunity has been given to Thornycroft Giles and Associates to validate some proposals for a new design along those lines, but work is still in progress and no submission has yet been made to the Ministry of Defence about it.

    Zimbabwe
    Mr. Proctorasked the Secretary of State for Defence how many meetings have taken place between officials from his Department and officials representing the Government of the Republic of Zimbabwe to discuss British military assistance to that country since April 1980; and if he will make a statement.
    The Under-Secretary of State for the Armed Forces (Mr. Jerry Wiggin): We have been providing military assistance to Zimbabwe for the past three years in support of efforts to secure a peaceful and stable future for that country. This has involved frequent contacts with members and representatives of the Zimbabwe Government.
    Mr. Proctor: In the light of the attacks in Zimbabwe on the free press, the moves by Mr. Mugabe towards a one party state, and the murderous attempts on Zimbabweans, black and white, in Matabeleland, will my right hon. Friend reconsider giving further British military aid to that country?
    Mr. Wiggin: I must say to my hon. Friend that the points that he raises are not for me, but for my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs. With regard to British military aid, the troops that we have been training have not been involved in any of these disgraceful episodes.
    Mr. Hooley: Does the Minister agree that as long as there is a serious military threat to Zimbabwe from South Africa it is reasonable that we should give military assistance to that country?
    Mr. Wiggin: The object of providing military assistance to Zimbabwe is well known to the hon. Gentleman and has very little to do with his question.
    Mr. Ian Lloyd: What serious evidence can my hon. Friend offer the House to show that the provision of either military or economic aid to Zimbabwe is likely to mitigate, or has mitigated in any serious way, the consequences of the rapid retreat from the Lancaster House agreement? If it has not mitigated those consequences, in what way is the continued provision of either military or economic assistance said to be in the interests of the United Kingdom?
    Mr. Wiggen: I dealt with that in my former answer. The questions that my hon. Friend raises are not for me. The British advisors have competently and capably trained a part of the Zimbabwean army to lead to an orderly future for that country. The problems being encountered are, unfortunately, due to those parts of the army that were trained by the North Koreans.
    Mr. McNamara: Is the Minister aware that those of us who have been fortunate enough to see and meet members of the British military mission in Zimbabwe have been impressed by their work and by the obvious support that they have received from the Zimbabwean Government? Is he further aware that anything that can be done to maintain stability in central Africa and provide a buffer against aggression from South Africa, and with which this country can be associated, is to be welcomed?
    Mr. Wiggin: I welcome the hon. Gentleman's opening remarks. Of course, we do these jobs extremely well, as the world knows. The hon. Gentleman's congratulations to our forces are well deserved and I shall see that they are drawn to their attention.

    Hovercraft
    Mr. Stephen Rossasked the Secretary of State for Defence whether he intends to place any orders for hovercraft in their minehunting capacity as recently demonstrated to the Royal Navy.
    Mr. Ian Stewart: We have no present plans to do so, but we are considering running on the BH7 hovercraft for further trials.
    Mr. Ross: Does the Minister agree that mine detection and mine hunting and destroying are important matters, for which the Government need to step up our protection? Is he aware that for about 12 years we have been conducting trials with the BH7, which is a project of great importance to the economy of my constituency? Is it not about time that we placed some firm orders?
    Mr. Stewart: I recognise the importance of taking counter measures against mines, particularly since I served in minesweepers for a considerable period. I am awaiting an evaluation of the performance of the hovercraft in the trials that have recently taken place, and we will be considering our proposals at that stage.

    Nimrod Aircraft
    Mr. Arnoldasked the Secretary of State for Defence if he has any further plans to purchase Nimrod aircraft.
    The Minister of State for Defence Procurement (Mr. Geoffrey Pattie): There are no plans to place orders for further Nimrods at present.
    Mr. Arnold: The Royal Air Force will be 65 years old this weekend. What better way of honouring that anniversary than for my hon. Friend to make a commitment to the cost of starting up the production line for Nimrods, which would help not only the RAF but potential export customers?
    Mr. Pattie: As my hon. Friend knows, the reopening of the production line for Nimrod is primarily a matter for British Aerospace. We are awaiting proposals from British Aerospace and I hope that they will be forthcoming quite soon.
    Mr. Dalyell: With their twin Marconi AD 470 high frequency transceivers, could not Ascension based Nimrods pick up the coded messages between the Argentine mainland and the Belgrano and her escorts? With their encryption facilities, could they not send coded in-flight messages to the British Prime Minister, and was it not partly through Nimrod that the Prime Minister knew perfectly well what the orders were from the mainland to the Belgrano before she gave the orders to HMS Conqueror to torpedo her?
    Mr. Pattie: No.
    Mr. Dalyell: It is a lie.
    Sir Hector Monro: Does my hon. Friend agreeߞ
    Mr. Dalyell: That is a lie.
    Sir Hector Monro—that the Nimrod is now an outstanding maritime aircraft, particularly—
    Mr. Speaker: Order. I distinctly heard the hon. Member for West Lothian (Mr. Dalyell) repeat the word "lie". He must now withdraw it.
    Mr. Dalyell: The Minister was misleading the House of Commons.
    Mr. Speaker: Has the hon. Gentleman withdrawn the word "lie"?
    Mr. Dalyell: Certainly. I withdraw the word "lie". The Minister was misleading the House of Commons.
    Mr. Speaker: That is enough. I call Sir Hector Monro.
    Sir Hector Monro: Does my hon. Friend agree that the Nimrod is an outstanding maritime patrol aircraft, particularly now that it has an air fueling capability? Does he also agree that the Shackelton has done magnificent service but is now becoming obsolescent? How long will it be before they are all retired?
    Mr. Pattie: I believe my hon. Friend knows that we have plans to replace the Shackleton AEW squadron with the Nimrod AEW squadron in about two years from now.

    Sea King Helicopter
    Mr. Conlanasked the Secretary of State for Defence what progress has been made in his consideration of a possible successor for the Sea King helicopter.
    Mr. Pattie: Joint definition studies of the Anglo-Italian EH 101 anti-submarine warfare helicopter are complete. Industry foresees good sales prospects for commercial versions of EH 101, and we plan to move ahead with a fully integrated naval and commercial programme. Detailed arrangements are now being finalised and it is hoped to launch full development this summer.
    Mr. Conlan: I welcome that reply, but will the Minister ensure that the defence proportion of the development costs are made available to Westlands as they are required? Does he recognise that failure to do so will make the British forces dependent upon American equipment, which will have a severe effect upon the balance of purchases of defence equipment between the two countries?
    Mr. Pattie: I can reassure the hon. Gentleman that the Ministry of Defence is one of the six active partners in this project. The first requirement is for the number of aircraft that would be required for the Royal Navy, so there is no question of a purchase from the United States.
    Mr. Peyton: While I welcome my hon. Friend's reply on this important project, which is of great significance to my constituents, may I ask what progress is being made by the Italian Government in their handling of this matter?
    Mr. Pattie: The Italian Government are taking through their Parliament a law that will provide the necessary funds for the Italian Ministry of Defence contribution, the contributions of Italian industry and the Italian Department of Industry having already been secured.
    Mr. Jim Spicer: As someone with an equal constituency interest in the success of the Sea King, may I ask whether my hon. Friend accepts that we all know that we have a winner? Even if the Italian Government are, to say the least, tardy in completing their part, will my hon. Friend give an assurance that the Government accept that they have a winner and that they will go ahead with it, whatever the cost?
    Mr. Pattie: I welcome my hon. Friend's enthusiasm for the project, which of course I share. We have no reason to doubt the commitment of the Italian Government to the project. Both Governments foresee a market, on both the military and the civil side, for several hundred units.

    Arms Sales
    Mr. Skinnerasked the Secretary of State for Defence if he will publish in the Official Report a list of the countries to which the United Kingdom has sold arms since May 1979.
    Mr. Pattie: Yes, Sir. I shall arrange for the information to be published.
    Mr. Skinner: Will the Minister ensure that Argentina is included, because British manufacturing industry and others involved in weapons manufacture are providing components for the French Exocets and the German frigates? Does he admit that, since Argentina has run short of money, the Tory Government have, through the British banks, allocated hundreds of millions of pounds to enable that country to buy the Exocets and frigates so that it can play further war games with British lives in the Falklands and elsewhere?
    Mr. Pattie: I have told the hon. Gentleman that the list will be published. He must wait and see what countries are included. As there are 84 countries, I should be surprised if Argentina were not among them—as it was while the Labour Government whom he supported were in office.
    Mr. Churchill: Before disposing by sales overseas of the third of a million or more self-loading rifles belonging to the British Army that are becoming obsolescent, will my hon. Friend have regard to the fact that in the event of a future crisis barely 1 per cent, of the population of these islands will have a weapon available to them? Will he give careful consideration to the recent proposals advanced by General Sir Anthony Farrar-Hockley and Lord Hill-Norton for the formation on a large scale of a volunteer home defence force?
    Mr. Pattie: It is not the Government's intention to dispose of surplus self-loading rifles overseas.
    Mr. McNamara: Is the Minister aware that the Opposition will have no part in a suggestion by superannuated old brass-hats for a home guard? Will the
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    hon. Gentleman publish in the Official Report a list of long-term commercial agreements with countries supplying arms to Argentina that the Government feel it is still necessary to fulfil?
    Mr. Pattie: We have plans to publish only those agreements of which the defence sales organisation has had official notification and for which export licensing arrangements are required.
    Following is the information:
    List of countries with which contracts for defence equipment were signed since May 1979
    Attached is a list of 84 countries with which contracts for military equipment were signed since May 1979 and which were notified to the Ministry of Defence. As such, the list, though substantially correct, may not be comprehensive, because not all private orders, particularly those of a minor nature, have to be notified to defence sales organisation. All exports of military equipment as defined in group 1 of the Export of Goods (Control) Order are, of course, carefully controlled, and subject to the granting of an export licence by the Department of Trade.

    Abu Dhabi (UAE)

    Algeria

    Angola

    Argentina*

    Australia

    Austria

    Bahamas

    Bangladesh

    Barbados

    Belgium

    Belize

    Botswana

    Brazil

    Brunei

    Cameroon

    Canada

    Chile

    Colombia

    Denmark

    Dominican Republic

    Dubai

    Ecuador

    Egypt

    Finland

    France

    Greece

    Grenada

    Guyana

    India

    Indonesia

    Iran

    Iraq

    Irish Republic

    Israel

    Italy

    Jamaica

    Japan

    Jordan

    Kenya

    Kuwait

    Lebanon

    Lesotho

    Liberia

    Libya

    Malagasy

    Malawi

    Malaysia

    Netherlands

    New Zealand

    Niger

    Nigeria

    Norway

    Oman

    Pakistan

    Panama

    Peoples Republic of China

    Peru

    Philippines

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    Portugal

    Romania

    Qatar

    Saudi Arabia

    Seychelles

    Singapore

    Somalia

    South Korea

    Spain

    Sri Lanka St. Vincent Sudan

    Surinam

    Swaziland Sweden

    Switzerland Syria

    Thailand

    Trinidad and Tobago

    Tunisia

    United States of America

    Uganda

    Venezuela

    West Germany

    Yugoslavia

    Zimbabwe

    * Embargo imposed following the invasion of the Falkland Islands now prohibits the delivery of any military equipment from the United Kingdom to Argentina.

    NATO (Maritime Contribution)
    Mr. Duffyasked the Secretary of State for Defence if he is satisfied that the United Kingdom can continue to make an effective maritime contribution to the Alliance in and out of area.
    Mr. Heseltine: Yes, Sir.
    Mr. Duffy: Is the Secretary of State aware that in addition to NATO assigned roles, tactical exercises and operational weapons trials, the Navy is committed in the south Atlantic, to the Gulf patrol and to the Gibraltar and Belize guardships at a time when he is running down the Navy? Is he aware that the forces committed to Germany are absorbing a growing percentage of our defence costs—as much as 50 per cent. by the late 1980s? Is he quite sure that he has his priorities right?
    Mr. Churchill: And the Opposition want to cut defence by a third.
    Mr. Heseltine: The hon. Member for Sheffield, Attercliffe (Mr. Duffy) raises a number of important priorities for the Royal Navy. They have been carefully weighed in the overall priority of the Government's defence policy. Within the context of what we can afford, we are making a real contribution to the Royal Navy. For example, last year more money was spent on new construction for the Royal Navy than at any time during the past 19 years. There are now some 34 ships in the process of construction.
    Sir Patrick Wall: As there is a grave shortage of escort vessels, will my right hon. Friend undertake not to scrap, but to mothball, frigates until the type 23 frigates are in commission?
    Mr. Heseltine: My hon. Friend must realise that in the end there comes a point in the life of a frigate when it must be scrapped. We have taken a decision to run on rather longer than was first intended the TRIBAL class frigates that were brought out of mothballing for the Falklands exercise.
    Dr. McDonald: How can the Minister give those assurances when he knows full well that on present plans the Navy will fall below strength by 1990? Does he admit that it will not be able to fulfil all its roles because the Government are determined to have Trident at any cost, and especially at the cost of our conventional defences?
    Mr. Heseltine: The hon. Lady should consider that question carefully—especially today, when the Labour policy that has been announced will have the effect of reducing the annual defence expenditure of Britain by £4,500 million, which more than exceeds the cost of running the whole of the Royal Navy for a year.

    Frigates
    Sir David Priceasked the Secretary of State for Defence when he expects to be able to announce the placing of further orders for new frigates for the Royal Navy.
    Mr. Ian Stewart: It is our intention to place an order for the type 23 first of class next year. With regard to the batch III type 22 frigates, design work is well advanced at Yarrow Shipbuilders Ltd. and we hope to go out to competitive tender for the fourth Falklands replacement ship shortly. We would then intend to place an order as soon as tenders have been evaluated.
    Sir David Price: Is my hon. Friend aware that delay continues to cause anxiety, especially for the Vosper Thornycroft shipyard at Woolston? Is he aware that that shipyard has the best export record for naval ships in the whole of British Shipbuilders? If it does not soon receive an order for a metal hull it will be unable to fulfil its historic role as a lead yard supplying the Royal Navy.
    Mr. Stewart: The order for a warship comes at a late stage in the procurement process. I do not accept my hon. Friend's comments about the delay. My right hon. Friend the former Secretary of State for Defence said in December that Vosper Thornycroft would be one of two shipyards that would be strong contenders for the fourth replacement frigate. It is for that yard to put in an irresistible tender if it wants the order.
    Mr. Douglas: Can the Minister say at which yard the type 23 order will be placed? Is he aware that yards on the Clyde are running short of work? When equipment for the type 23 is being considered, will he have a voice and view about export orders being achieved, especially for the ESM equipment?
    Mr. Stewart: It will be satisfactory if export orders can be obtained. We always take that important factor into account.
    It is usual for contracts for ships such as the type 23 to be placed with the design yard, which, in this case, is Yarrow Shipbuilders.
    Mr. Viggers: Is it the Government's policy to continue with the idea of having three designated warship builders as lead yards? If no order is placed soon with Vosper Thornycroft, it will not be possible for it to maintain its specialist design and construction team.
    Mr. Stewart: Of course, I recognise both the merits and the needs of Vosper Thornycroft. But ultimately the choice of yard and the number of yards available for building warships are matters for British Shipbuilders and

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    not the Ministry of Defence. The MOD is the major customer, and therefore has a major interest, but it does not take decisions on such matters.

    Non-proliferation Treaty
    Mr. Luceasked the Secretary of State for Defence what assessment he has made of the effect of the nonproliferation treaty on the security of the United Kingdom.
    Mr. Blaker: The non-proliferation treaty has been an effective check on the further proliferation of nuclear weapons and has contributed to the security of all countries. We welcome the fact that there are now 120 parties to the treaty and we shall continue to encourage more countries to sign.
    Mr. Luce: Since the dangers of nuclear proliferation are obvious, does my hon. Friend agree that wider adherence to the treaty can best be achieved if it is clear that every effort is being made by the nuclear powers to obtain multilateral, mutually balanced disarmament? As important talks are taking place in Geneva between the United States and the Soviet Union, can my hon. Friend assure the House that the British Government are making every effort to seek wider support for the treaty?
    Mr. Blaker: I can give my hon. Friend that assurance. I am happy to tell him that eight further countries have adhered to the treaty since 1978. The treaty states in article 6 that the parties to it must make their best efforts to secure multilateral nuclear and other disarmament. That is why it is important to support the proposals that President Reagan has made in the INF context and the START negotiations.
    Mr. Denzil Davies: If it is so important for Britain to buy the Trident system, apparently, according to the Government, because it is good for us, why is it not good for other countries to do likewise?
    Mr. Pattie: That is not relevant to the non-proliferation treaty. [Interruption.] Opposition Members who laugh at that merely show that they have not read the treaty.
    Mr. Cryer: Does not article 6 place an obligation on the United Kingdom such as to prevent our purchasing Trident? At the 1980 review conference did not many of the non-nuclear powers become extremely critical of nuclear powers such as the United Kingdom for not reducing their dependence on nuclear weapons but rather increasing it? Would not getting rid of nuclear weapons help the non-proliferation treaty and the United Nations? Is that not the direction in which we should go?
    Mr. Pattie: Our purchase of Trident is no more a breach of the non-proliferation treaty than the modernisation by other countries, including the Soviet Union, of their existing systems. The treaty does not impose an obligation on existing nuclear states to allow their existing systems to decay.

    Cruise Missiles
    Mr. Frank Allaunasked the Secretary of State for Defence if he will have further discussions with Defence Ministers in other countries on the installation of United States cruise missiles on British territory.
    Mr. Heseltine: I meet my NATO ministerial colleagues periodically to discuss progress on implementing the decisions taken by the Alliance in December 1979 to modernise NATO's intermediate range nuclear forces, and to seek, by negotiation, limitations on intermediate range nuclear forces belonging both to the Soviet Union and the United States.
    Mr. Allaun: Does Mr. Reagan's new formula, which was announced this week, mean that not one single cruise missile will be deployed in Britain? If it does not mean that, is the Secretary of State aware that it is utterly unacceptable both to CND and Labour, whose manifesto this afternoon clearly states that there should be no cruise, no Trident and no nuclear bases on our territory?
    Mr. Heseltine: I am aware of the contents of the Labour party statement this afternoon, which amounts to an abandonment of all the defence policies that the Labour party believed in when it was in power. I can think of no more reckless gamble than for the Labour party to turn its back on the policies that have guaranteed the peace of the Western world for 37 years.
    Dr. Owen: Will the Government urge President Reagan to introduce into the INF negotiations the flexibility that was envisaged in 1979 at the time of the dual track decision—a linkage between intermediate missiles and strategic missiles? Without that flexibility we shall not be able to achieve satisfactory negotiations. The rigidity of trading off only SS20s against cruise and Pershing is the obstacle.
    Mr. Heseltine: The right hon. Gentleman raises an issue which is primarily the responsibility of my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs. The House will be aware that President Reagan announced last week that he would make a further statement on the issue this week. It is the subject of close consultation between the Governments.
    Mr. Allan Clark: Does my right hon. Friend agree that the fact that the United Kingdom is an independent nuclear power makes, or should make, the conditions under which cruise missiles are deployed here quite different from those in other members of the Alliance?
    Mr. Heseltine: I understand my hon. Friend's anxiety but he will be fully aware that the party of which vie are both members has long since accepted in government the joint decision arrangements with regard to existing American systems that are already deployed here. We believe that those systems and guarantees have worked and, therefore, we have accepted them with regard to cruise missiles.
    Mr. Denzil Davies: Why do not the Government now recognise that the 1979 decision to locate cruise missiles was wrong, dangerous and has done more to damage the Western alliance than any other decision? In view of the deep division in the House and the country, why do the Government not now stop all work on cruise missiles until the British public have decided one way or the other in the traditional manner?
    Mr. Heseltine: For the very reasons that the Secretary of State in the Labour Government at the NATO committee meeting just before the 1979 general election said that it was necessary for NATO to have nuclear

    177
    weapons and to modernise them. All that we have done is carry the agreement that the Labour party reached in government to its logical conclusion.
    Mr. Donald Stewart: Does the Secretary of State accept, in the light of MOD support for a naval base at Stornoway in the Western Isles and the possibility of cruise missiles being stationed there, that he ought to intercede with his right hon. Friend the Prime Minister because of the opposition of the majority of people there to that decision and in view of a report from a committee set up by the Secretary of State saying that the interests of the islanders ought to be paramount?
    Mr. Heseltine: I assure the right hon. Gentleman that I have had no consideration of such a proposal.

  PRIME MINISTER

    Engagements
    Mr. Duffyasked the Prime Minister if she will list her official engagements for Tuesday 29 March.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I 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 hope to have an audience of Her Majesty the Queen.
    Mr. Duffy: Has the Prime Minister noticed the public advice from the new West German Chancellor, the Dutch Prime Minister, and the Italian Foreign Minister to President Reagan to break the deadlock on the Geneva talks on Euro-missiles this week? Why is she silent when even Republican senators are adding their voice to that view? Could that united effort to lift the shadow of nuclear war not have found just a small echo in her long speech on Saturday, or is she opposed to any interim proposals and any compromise on the zero option?
    The Prime Minister: The hon. Gentleman can have listened neither to what I have said for several weeks nor to what I have said on television. I think that I was the first to point out that the original NATO. dual-track decision said that there must be equal numbers on both sides. The zero option came later. It would be far better if the hon. Gentleman directed his attention to the Soviet Union and asked it to reduce its missiles to nil. If the zero option—which is the best optionߞcannot be reached, we must have an option that provides for equal numbers on both sides, which does not include the British and French independent nuclear deterrent, and which is verifiable. There is nothing new in that.
    Mr. David Steel: As the Prime Minister has acknowledged that people over the age of retirement have a contribution to make, in running the National Coal Board, for example, will she now honour her manifesto pledge to abolish the earnings rule and allow elderly people to take up less exalted positions?
    The Prime Minister: It is indeed our objective to abolish the earnings rule. The right hon. Gentleman will be aware that a time of considerable unemployment is not the best time to do that. Nor do I feel that it would be welcomed in all parts of the country if we chose to do so now.
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    With regard to people aged over 70 having a contribution to make, there are some 23 in this House. They make a considerable contribution.
    Sir Paul Bryan: Is my right hon. Friend aware of the phenomenal success of the two Government schemes which provide microcomputers to schools on a scale that is unequalled in any other country? Has the time not now come to expand those schemes on a dramatic scale to take advantage of the enthusiasm and skills of all those young people?
    The Prime Minister: I thank my hon. Friend. It was a great step forward to put microcomputers in every secondary school and then in every primary school so that our young people are skilled at an early age and thinking in terms of the type of jobs—[HON. MEMBERS: "Jobs?"]—and products that computers and computing skills can create. We have allocated some £40 million between now and 1986 for microcomputers in schools. There is also a scheme for training 11,000 teachers to be able to train pupils properly.
    Mr. Foot: In view of the great significance for everyone of President Reagan's speech a few days ago on laser beam defence in space against intercontinental ballistic missiles, can the right hon. Lady tell the House what consultations there were with the British Government before that speech and what representations she made on the subject?
    The Prime Minister: Consultations, none. We were informed that the speech would be made. I must point out that a fantastic amount of research must be done, and the President's speech was about research in this area. It is advisable to continue such research.
    Mr. Foot: Does that mean that the right hon. Lady made no representations to hold up those proposals? How much will the proposals injure existing disarmament agreements, especially that reached between President Nixon and President Brezhnev about 10 years ago? Does it not mean that that treaty will be broken? What hope does she or anyone else believe there will be for new disarmament agreements if we tear up the old ones?
    The Prime Minister: That speech, and what it proposed, has no effect at all on the anti-ballistic missile agreement. That agreement does not affect research and it does not come into operation until the development of new anti-ballistic missiles. There is a long way to go in research before we reach any development. I believe in research, but the right hon. Gentleman obviously does not.
    Mr. Foot: It is not simply a question of research. Has the right hon. Lady taken into account the statement of the former president of the Massachusetts Institute of Technology—[Interruption.] These are not laughing matters. We believe that such matters must be dealt with properly. Mr. Wiesner says that the statement
    "is really a declaration of a new cycle in the arms race." Have the Government nothing to say on the subject?
    The Prime Minister: I am not unaware of scientific matters—[Interruption.] May I express my gratitude to the House for acknowledging that that is so, or at any rate for not arguing to the contrary. I believe in going ahead with that research. I remind the right hon. Gentleman that President Reagan made it clear that his proposals were consistent with United States' obligations under the 1972

    179
    anti-ballistic missile treaty. The treaty remains in force and was reviewed by both parties last year, when there was mutual agreement that no amendment to it was necessary.
    Mr. Squireasked the Prime Minister if she will list her official engagements for Tuesday 29 March.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Squire: Has my right hon. Friend found time to read the CBI policy document issued today, which states that freedom from planning agreements and from threats of nationalisation are essential for trade and industry to grow? Will she contrast that document, from those who understand industry and trade, with the reported contents of the document issued by the Labour party, which manifestly does not understand industry and trade?
    The Prime Minister: I agree with my hon. Friend that it is best for those in industry to be allowed to pursue their own organisation, products, marketing and financing in their own way. When they achieve the most competitive and best-designed products we shall achieve the greatest prosperity and the creation of jobs.
    Mr. Dubsasked the Prime Minister if she will list her official engagements for 29 March.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Dubs: Does the Prime Minister agree that it was highly misleading to publish selective crime statistics from one part of the country only and for fewer than 3 per cent. of all crimes? Does she agree that the way in which those selected crime statistics were presented was damaging to race relations, and will she confirm that the majority of black, as well as white, people in Britain are decent and law-abiding?
    The Prime Minister: Indeed. One would not quarrel with that, but my right hon. Friend the Home Secretary simply answered the question that was asked.
    Mr. Ian Lloyd: My right hon. Friend will undoubtedly have had her attention drawn to the most recent annual report of Freedom House, which categorises Grenada as being within the hard core of the Communist system. Is she aware that not only Grenada but about one quarter of the member countries of the Commonwealth are now one-party states? Does she not consider this a most serious breach of the principles of the Commonwealth? As she will undoubtedly be leading the United Kingdom delegation to the next Commonwealth Prime Ministers' conference, will she ensure that these matters are discussed as soon as possible?
    The Prime Minister: I am sure that my hon. Friend has strong views about one-party states, as quite a number of us have. However, my hon. Friend would be the first to realise that, once countries are independent, they are free to pursue their own systems. The Commonwealth sets its own standards, and I am afraid that there is no exclusion of those who operate as one-party states.
    Mr. Hoyleasked the Prime Minister if she will list her official engagements for 29 March.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Hoyle: Will the Prime Minister take time off from her engagements today to say what were the special
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    reasons that made her agree to the appointment of the executioner of the British steel industry, Mr. Ian MacGregor, to become the undertaker of the coal industry? Was it a fit of pique to get even with the miners? What will it cost the British taxpayer to get rid of this expensive American citizen from his position at the National Coal Board?
    The Prime Minister: My right hon. Friend the Secretary of State for Energy dealt with this matter yesterday. Mr. MacGregor was appointed because of his excellent record, especially in coal. He took his own business into the coal industry, made it the third Largest producer in the United States, and invested heavily in coal at a time when others did not. We appointed him because we believe that he is the best person for the job.
    Mr. Cyril D. Townsend: In greeting the second coming of the social contract, does my right hon. Friend recall that the last time we had this animal the Government gave and the trade unions received? Is it not grotesque and inherently wrong that a Government should have a contract with a privileged and protected group in society such as the trade union leaders?
    The Prime Minister: Yes. It is totally and utterly wrong that a Government should represent one section of society and not others—[HoN. MEMBERS: "That is what the Government do."] The Labour Government attempted to have a social contract with the TUC, and when people asked who was more powerful, the then Prime Minister or Mr. Jones, the answer was "Mr. Jones". That is totally wrong. People were fed up with the social contract, which took Britain to the highest rate of inflation in modern times.
    Mr. James Hamiltonasked the Prime Minister whether she will list her official engagements for Tuesday 29 March.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Hamilton: Will the right hon. Lady take time, if she has not already done so, to read the editorials of most newspapers condemning the appointment of Ian MacGregor as chairman of the National Coal Board, which is reputed to be entirely her appointment? Will she ensure that during his transitional period between the British Steel Corporation and the National Coal Board under no circumstances will he depart from the decision reached in the House in December 1982, when it was made crystal clear that the five major plants would be inviolate and that Ravenscraig would remain in exactly the same position as it is at present?
    The Prime Minister: The announcement about the five major BSC plants was that decisions would be taken by the Government. The statement also said that one can never guarantee a plant a future for all time, regardless of performance. If the hon. Gentleman looks back to that statement, he will find that that is so.
    Mr. Silvesterasked the Prime Minister if she will list her official engagements for Tuesday 29 March.
    The Prime Minister: refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Silvester: Has my right hon. Friend had an opportunity to study the recent report of the CBI on

    181
    expectations in industry, which shows a remarkable upturn in its expectations for output? Is it not time that those who enjoyed commenting on the gloom of previous studies took pleasure in the optimism of this one?
    The Prime Minister: I agree with my hon. Friend. The latest monthly report of the CBI shows that more firms expect to increase their output and that export order books have increased sharply. That is very good news. The optimism is more widespread than it was and there is a real chance that we are firmly on the road to recovery.
    Mr. William Hamiltonasked the Prime Minister if she will list her official engagements for 29 March.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Hamilton: Will the right hon. Lady tell the House which she thinks will come first—a reduction in the number of company bankruptcies or a reduction in the number of unemployed under her Government?
    The Prime Minister: If the hon. Gentleman looks back to some of the speeches made by members of the Labour
    182
    party he will find that there is always a time lag in reducing the number of unemployed. It happens that I have a quote with me. As the right hon. Member for Leeds, East (Mr. Healey) said at a bankers' banquet in 1976.
    "There is a time lag of up to a year between the increase in output and the fall in unemployment it produces."
    I am grateful to the hon. Member for allowing me to get that quotation out.
    Mr. Speaker: Mr Frank Hooley, on a point of order.
    Mr. Hooley: May I take if after the introduction of the new Member?
    Mr. Crouch: On a point of order, Mr. Speaker. Before we proceed, I draw your attention to the fact that there is some unwanted political propaganda on the Table and obliterating the Mace—at least there was, but it has now gone.

NEW MEMBER
The following Member took and subscribed the Oath: Oswald O'Brien Esq., for Darlington.

Standing Orders (Select Committee Report)
3.22 pm
Mr. Frank Hooley rose—
Mr. Speaker: Order. I gave the hon. Gentleman his opportunity, as the House knows.
Mr. Hooley: On a point of order, Mr. Speaker.
Mr. Speaker: If the hon. Gentleman has a point of order, it will be in his interest to wait a moment until hon. Members have left the Chamber.
Mr. Hooley: On a point of order, Mr. Speaker. I should like to raise with you—
Mr. Speaker: Order. I point out to the hon. Gentleman that, when I call him for a point of order in the ordinary process of our business, he should make his point of order then and not decide for himself that he will choose his own moment to do so. This is a point of order about which the hon. Member has given me notice, and I came prepared to answer him. That will not take two seconds. I point out to the House that hon. Members must not feel that they can choose their own moment to interrupt the business when I have called them.
Mr. Hooley: I regret if I have in any way upset the conventions of the House, Mr. Speaker. My intention was simply to show courtesy to a new colleague on his introduction to the House. I am sorry if that contravened the conventions and rules of the House, and I accept your correction if that was so, Mr. Speaker.
My point of order arises out of a motion on the Order Paper concerning the report from the Select Committee on Standing Orders (Revision). The report was published on 2 March 1983 and its terms of reference are set out on page 2 of the report. They are:
"That a Select Committee be appointed to consider and report upon the re-arrangement and re-drafting of the Standing Orders so as to bring them into conformity with existing practice."
I draw the attention of the House to the phrase
"bring them into conformity with existing practice."
One of the recommendations of the report, on page 56, departs substantially from the existing practice of the House. On page 56 the Committee says:
"This amendment would involve a change of practice in order to conform with the intention of the Order".
It goes on to say specifically that this would be a change in practice.
The proposition made by the Committee as set out on page 56 is that, if an hon. Member is suspended by Mr.
184
Speaker, he shall forfeit his salary during the term of his suspension. My point is that it was outwith the terms of reference of the Committee to make any such recommendation. Therefore, that recommendation does not conform to the terms of reference of the Committee as laid down by the House and should be struck out of the report and not debated. I would welcome your ruling, Mr. Speaker, on whether the recommendation is in order, having regard to the terms of reference laid down by the House for the Select Committee.
Mr. Speaker: I am obliged to the hon. Gentleman for giving me notice of his point of order. However, "Erskine May" says on page 635 that the interpretation of the terms of reference for a Select Committee is a matter for the Committee. It is for the House to decide whether it likes what the Select Committee will recommend. This Select Committee dealt not only with this matter but with something else that could be interpreted as being outside the terms of its reference. The House will have a chance to decide if I select the amendment. It is not out of order, but the House will decide whether it agrees with the Select Committee.
Mr. Michael English: Further to the point of order, Mr. Speaker. Before you make the selection, no doubt you will wish to consider the well-known rule of law that, although the House of Commons has power to imprison, it has no power to fine.
Mr. Speaker: In the words of a former Prime Minister, we shall wait and see.
Mr. Nigel Spearing: Further to that point of order, Mr. Speaker. Will you clarify a point of some significance with regard to the ruling that you gave my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley)? When a Select Committee takes heed of the terms of reference in the way that you have described, is the "Erskine May" definition in relation to a grey area or one on which there is some ambiguity in the terms of reference, or is it related to the Select Committee doing anything that it wishes, even if it is outside the terms of reference as generally understood?
Mr. Speaker: It is a matter of common sense, and a Committee will interpret its terms of reference. Sometimes others may disagree with the interpretation of the Committee, but it is up to the House to decide whether it wants to accept the recommendations of the Select Committee.

Marital Rape
3.39 pm
Mr. John Tilley: I beg to move,
That leave be given to bring in a Bill to amend the Sexual Offences (Amendment) Act 1976 to make rape within marriage a criminal offence.
I seek the leave of the House to introduce the Bill so as to draw the attention of hon. Members and the public to the fact that there are circumstances in our law where the act of rape is perfectly legal. I hope that realisation of that fact will create such a storm of protest both in the House and in the country that there will be an early change in the law. The circumstances in which rape is legal occur when the victim is the wife of her assailant. However unwilling the woman is, however fierce her resistance, her assailant has only to produce a marriage certificate to escape all legal blame or punishment.
The House last considered this issue in 1976, when an amendment making marital rape a criminal offence, just like all other forms of rape, was carried during the Committee stage of the Sexual Offences (Amendment) Act. The amendment was withdrawn on Report, when the then Minister assured the House that the Criminal Law Revision Committee would consider the matter very carefully. It did consider the matter, and in 1980 it reported its conclusion that a majority of its members favoured an amendment in the law along the lines of the Bill that I seek to introduce today. I shall quote a small part of its report. It said:
"The present law, which is part of the common law, has an archaic flavour to it. It is generally taken to be as stated by Hale in his Pleas of the Crown, which he wrote in the 1650s.
`The husband cannot be guilty of rape committed by himself upon his lawful wife, for by their mutual matrimonial consent and contract the wife hath given up herself in this kind unto her husband which she cannot retract.'
The critics of this law point out that since Hale's time wives can retract this consent. They can get divorces and separation orders. The courts have had to recognise in relation to rape modern changes in attitude towards marriage."
It goes on:
"The most glaring anomaly of all … is that a woman who is cohabiting with a man—and maybe she has done so for very many years—can refuse him sexual intercourse and her refusal, if it can be proved, will come within the law of rape, whereas a wife's will not. Cohabitation outside marriage is becoming increasingly common and this adds to the anomaly of drawing the distinction as it is now drawn. Stated at its simplest, the criticism is that the present rule denies married women something to which all other women are entitled."
It is quite clear from that quotation that the Criminal Law Revision Committee came down on the side of changing the law. That report was published three years ago, and since then the Government have not taken any action to implement it, and by supporting the Bill today the House can act where the Government have so far failed to act.
There are two major objections to a change in the law of this kind. I shall deal with them briefly but separately. The first is that a contested charge of marital rape would be very difficult to prove in court, because it would simply be the word of one person against that of another, with no corroborative evidence. That is quite true, but it is just as true of many allegations of rape, as the law now stands. The fact that a crime is difficult to prove is not a reason for saying that it is not a crime at all. The criminal law is not simply a mechanism for securing convictions. I believe
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that its more fundamental purpose is to list the actions and activities that society finds so abhorrent that the perpetrators deserve punishment. Surely the act of rape is such a terrible act that every form of rape should be on the list of crimes which British society does not want to go unpunished.
The second objection is that the law must be very chary of entering the complex and intimate relationship between man and wife, and that problems within a marriage may be exacerbated rather than solved if they are dragged through a court of law. There is a great deal of sense in that view, but I put it to the House that the law as it stands, and as it has stood since at least 1650, has interfered in a most unfair and biased way in marriage by legalising marital rape. I suggest that those who believe that the law should put marriage partners on an equal footing should support this Bill, because it removes a massive bias against the woman in a marriage. Why, in 1983, should a man have a legal right to rape his wife?
By explicitly condoning rape within marriage, the law implicitly condones other forms of violence and assault within marriage. Is it not ironic that 100 years after this House passed the Married Women's Property Act, which gave a married woman control over her material possessions, the law still does not give a married woman the same control over her own body and her own fertility?
I do not say that the law as it stands is being preserved expressly to oppress married women. However, I suggest that a law that is based on the power relationship that existed between a husband and wife in the 1650s is grossly outdated, and reflects neither present-day reality nor the way in which society is developing its views on marriage. Society's views on rape itself are also changing. In the seven years since the issue was last considered in this House, public attitudes to rape have changed, and changed for the better. It is no longer just a subject for embarrassed silence or sniggers.
The press, in particular, has given the issue more thoughtful coverage and has expressed concern when judges do not take a serious enough view of the offence. The Prime Minister herself, from the Dispatch Box, was swift to condemn the trifling sentence imposed recently on a double rapist. In Scotland, Lord Robertson gave an important judgment just a year ago, declaring that marital rape could be an offence under Scots law. I suggest, therefore, that it is now time for this House, as a lawmaking body, to bring the law in England and Wales into line with the new and better attitudes that are emerging.
The Bill would not lead to many prosecutions. That is not its purpose. Its purpose is to demonstrate that this House believes that the act of rape—enforced sexual intercourse—is so abhorrent and so harmful to its victim that every woman in Britain should have the protection of the law against such violation. The only way to achieve that is to outlaw the act of rape, wherever and whenever it occurs.
Question put and agreed to.
Bill ordered to be brought in by Mr. John Tilley, Miss Jo Richardson, Miss Joan Maynard, Mr. Reg Race, Mr. Alfred Dubs, Mr. Frank Dobson and Mr. Jack Ashley.

Marital Rape
  MARITAL RAPE
  Mr. John Tilley accordingly presented a Bill to amend the Sexual Offences (Amendment) Act 1976 to make rape within marriage a criminal offence: And the same was read the First time; and ordered to be read a Second time upon Friday 13 May and to be printed. [Bill 118.]
Orders of the Day
  Telecommunications Bill
    2ND ALLOTTED DAY
    As amended (in the Standing Committee), further considered.
    2ND ALLOTTED DAY
      Clause 2

        ABOLITION OF BRITISH TELECOMMUNICATIONS EXCLUSIVE PRIVILEGE ETC.
        3.48 pm
        Mr. John Golding: I beg to move amendment No. 120, in page 2, line 39, at end insert `, except in relation to running cable systems'.
        It was difficult for Opposition Members to speak in our debate yesterday because of the length of the speech that was made by the Minister of State, and because of the internal Conservative party battle that took place between 10 o'clock last evening and almost midnight, when the guillotine came down. Today I hope that Conservative Members will give the Opposition time in which to put their point of view.
        In my opinion, it is sharp practice for a Government to introduce a guillotine to curtail discussion of a Bill which is of great importance not only to subscribers and the manufacturing industry but to the staff. The Government curtailed discussion, and then took the time of the House to conduct internal party battles.
        People outside will note how the Government: have behaved over the Bill. In order to hand over telecommunications to their friends in private industry, so that private industry can make, in the words of Lord Weinstock, a quick buck, they have set out on the road of liberalisation and privatisation—not because that is in the interests of Britain or of tile telecommunications industry, but because even the oil revenues are inadequate to fund the unemployment that the Government have created. They need to sell off—often at cut prices—industries that have been created from public investment to obtain additional revenue with which to fund unemployment. That is the damnable situation that we face today.
        The amendment is designed to ensure that responsibility for installing and developing the future cable system will rest with the publicly controlled British Telecom.
        The Government's position on cabling is not clear. We were promised that before, Easter there would be a White Paper on the development of cable in Britain. Perhaps the Government do not use the same timetables, the same calendar or the same diaries as the Opposition use. I had thought that Good Friday was next Friday and that Easter Monday was next Monday, but there is still no sign of the White Paper dealing with the cabling of Britain.
        All too often Ministers have promised us documents that are essential for the sensible discussion of telecommunications policy but have failed to keep their promises. I mentioned yesterday the promise of information on access fees, on the licence for British Telecom and on the memorandum about British Telecom, including specific statements about the role of British

        189
        Telecom in the cabling of Britain. The Minister of State promised all that information, but we have not yet received it.
        Despite the ill-fated report of the Information Technology Advisory Panel which was commissioned by the Department of Industry, and despite the timidity of the unsatisfactory Hunt report, we learnt in Committee that the Minister of State was moving towards the proposition that, in the long term, cable should be national, switched and broad band, and must integrate telecommunications, broadcasting and data transmission.
        I think that even the Government now recognise that the development of cable must be under public control. That has led them to reject the shallowness of the ITAP report and to acknowledge that fibre optics must have a dominant role. I do not know whether the Minister is reading his holiday brochure, but it would be better if the doyen of information technology would take some interest in the debate on cable.
        The Minister for Industry and Information Technology (Mr. Kenneth Baker): It is not a holiday brochure. It is a brochure published today by my Department on the small engineering firms investment scheme which will provide £100 million in funding for British companies to buy the latest electronically controlled machine tools. Many of the companies that will benefit from the scheme—
        Mr. Speaker: Order. I believe that the Minister is about to use the magic word "cable".
        Mr. Baker: You anticipated my very words, Mr. Speaker. Under the scheme, many British companies will be able to buy machine tools to help to develop the technology for the cable revolution in Britain. That is why I recommend the brochure to all Members of the House.
        Mr. Golding: The Minister makes my point for me. The doyen of information technology is more interested in reading about a bogus scheme that has entirely failed to impress the country, especially the west midlands, than in the legitimate argument about cable technology. I should have been more impressed if he had been reading the promised White Paper on cable, which has so far not appeared, rather than a glossy pamphlet on an entirely different subject. I suspect that the Minister is not listening to the argument, because whenever he has listened to us he has been persuaded and has had to try to knock some sense into the Secretary of State and the Prime Minister, and in this context I think that that is beyond even the Minister's capacity.
        The Government have had to reject the shallowness of the ITAP report and to acknowledge that fibre optics must play a dominant role. That report was an attempt to rescue just a couple of private cable relay firms. The Government have had to reject the ITAP view that there was no role for new technology in the development of cable and to acknowledge that fibre optics must be dominant and that the switched star system should be developed in this country. They have accepted the logic of that, but they are not taking sufficient action on it. Having rejected the ITAP report, they are inhibited by their own Hunt report which is dominated by the free market philosophy.
        It is regrettable for broadcasting that the Government have failed to accept that there should be a separation
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        between those who install and maintain the physical cable systems and those who use the systems for broadcasting and data trasmission. It would have been far better if the Government had created a common carrier system and separated the physical network from broadcasting and other uses of the system. It is regrettable from Britain's point of view that the Government accepted the Hunt recommendations.
        4 pm
        In Committee the Minister confessed that logic was on the side of the Opposition, and that the weight of argument was with the Post Office Engineering Union, the TUC and British private manufacturing industry. The Minister is faced not only by the POEU, which says that it wants a national system based on fibre optics, but by our major employers and manufacturers in the cable industry who say that the POEU is right and that the Government are wrong. Some of the Government's major supporters and closest advisers in manufacturing industry have been telling them that the future lies in the development of fibre optics.
        The Minister knows that the Opposition are right. Reading between the lines of his speeches, the utterances that are delivered with confidence are those in support of fibre optics, but those that are delivered with hesitation tend to support copper coaxial cable. I think that the Minister has been persuaded, and that if he had total freedom, he would agree with the Opposition. However, he is not a free agent. His policy is determined by the Secretary of State, who is more concerned to keep happy those individuals who wish to provide cable and, in the words of Lord Weinstock, make a quick buck than to provide the best system for Britain.
        The Government, the Minister and the Department of Industry are failing to support adequately the development of fibre optics. There is some force in their argument that in a cable system it is impossible to go over wholly to fibre optics at present. The logical conclusion of that argument is that more effort must be put into the development of fibre optics. After all, the Minister has acknowledged—I am sure that my hon. Friend the Member for Whitehaven (Dr. Cunningham) will raise this matter later—that Britain is a world leader in this business. If the Japanese and the Americans were world leaders in a technology which would have important consequences for telecommunications, they would be giving more support to the development of that technology,
        The Government are investing only £40 million in fibre optics, with a further £15 million for joint industry and university development. It ought to be much more. The Minister of State has been persuaded of the long-term validity of the argument that Britain should have a star system of cable rather than a tree-and-branch system. Instead of ensuring the maximum development from the start of the star configuration, the Minister has decided to ensure that new systems can be adapted to the star configuaration in the future. He recognises that the star configuration will hold the ring for the future. However, he has decided not to proceed immediately to that system but to ensure that the present systems are compatible in future.
        That would be all right if there was an almighty rush to develop the cable system, but that is not the position. What the Minister of State is doing is harmful not only to the telecommunications system and to the development of

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        the cable system in Britain but to British industry. If many tree-and-branch networks are installed in the United Kingdom, albeit with evolutionary potential, based heavily on coaxial cable, the economic dangers would be that the chance of boosting the United Kingdom's expertise and capacity in both switched systems and optical fibres would be diminished.
        These are home-grown technologies in which the United Kingdom is among the leaders and where there is export potential. In addition, coaxial cable is obsolescent. When the time comes for replacing it, the United Kingdom's capacity in optic fibre cable will be correspondingly weaker and more vulnerable to imports. Because coaxial cable is an old technology and widely available, the United Kingdom will be manufacturing it for home demand and there will be no export spin-off.
        I do not know whether there is another rebellion brewing on the Government Benches, but whenever I see the hon. Member for Aldridge-Brownhills (Mr. Shepherd) being listened to by the Minister I know that trouble is brewing. I know that the Minister is wondering whether he will have to summon the Leader of the House, as he did last night, the Government Chief Whip or even an ordinary Government Whip to deal with the hon. Gentleman. Opposition Members would appreciate it if these disputes in the Conservative party could, as is traditional, be conducted in private. It is disturbing, surrounded as I am by my colleagues in a party that is totally unified—
        Dr. John Cunningham: As in Darlington.
        Mr. Golding: As in the campaign document of which I have a rare copy. I find it distinctly off-putting to be faced with the continued controversy on the Government Benches, even though I understand it.
        Mr. Douglas Hogg: What about Bermondsey?
        Mr. Golding: When you were in charge, Mr. Deputy Speaker, in the Government Whips' Office, if a sedentary Government Whip had dared to utter an abusive comment from the Front Bench—
        Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. I am grateful to the hon. Gentleman, but I think that I should be left out of this.
        Mr. Golding: It is a rule, Mr. Deputy Speaker, that we cannot speak directly to Government Whips, so I must address the Whip through you. However, I think that you are better off, Mr. Deputy Speaker, out of the Government Whips' Office. You are better off not having to control the hon. Member for Grantham.
        American cable television is based on tree-and-branch systems. The United States of America therefore specialises in all the related hardware, which its manufacturers are keen to export. British cable consortia that lay tree-and-branch systems are likely to import much of that hardware. Given those three factors, is it surprising that British manufacturers should tell the Conservative Government that their proposals for cable will be disastrous for British jobs in the cable manufacturing industry? Is it surprising that those who run STC and that those in charge of GEC should indict this Government on the charge that they will destroy jobs and profits in British
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        industry? The Government are willing for those jobs and that profit to given to Japan, the far east, the United States of America or to anywhere but Britain.
        One of the Opposition's constant themes is that Conservative Members do not seem to care a hoot about jobs being lost in Britain. It is on record that when the hon. Member for Aldridge-Brownhills spoke about industry in his constituency he suddenly queried, as an afterthought, whether there was any left. The hon. Gentleman has been as concerned as any Opposition Member about the destruction of jobs. If there were a cable manufacturer in Aldridge-Brownhills, the hon. Gentleman would be conducting a rebellion—albeit unsuccessfully—on this issue, just as he tried to conduct a rebellion between 10 pm and midnight last night. The hon. Gentleman knew that these proposals would mean the loss of jobs in Britain.
        Britain is in the lead and a British technical development will transform telecommunications. However, instead of making every effort to exploit that invention and to develop the work, the Government are creating an environment in which that development will not take place in Britain. Indeed, the Government are creating an environment in which the Americans will flourish in Britain. During the past two years, have become used to seeing the Government's telecommunications policy being conducted in the interests of the American firm IBM. It is apparent that IBM does more successful political lobbying in this country than any other company. I do not see why we should stand aside and let the Government export jobs and profitability overseas.
        The Government's attitude to BT is also of concern. The Rediffusions of this world wanted BT to be kept out altogether. The Minister could not agree with that propositon and he said that it would be wrong to exclude BT altogether. However, BT can make an overwhelming case to be given the major role in cable installation and maintenance because of its resources, its present public accountability, its trained work force and its expertise in cable television, fibre optics, two-way services in communications and information technology gradually. According to the Minister, BT will compete freely for the provision of cable networks. Other things being equal, that would put BT in a very favourable position, because it has the men, the skills, the facilities and the expertise. However, I understand that the Government plan to cut BT's borrowing limit in the next financial year in addition to the constraints that have already been imposed. No such constraints will be imposed on BT's competitors.
        The Government's announcement has increased the likelihood of undermining the publicly owned and integrated telecommunications network. It has opened the door to private cable consortia carrying non-voice telecommunications traffic. We must oppose that strongly. [Interuption.] Like my hon. Friends, I am often in difficulty because I am not sure whether my right hon. Friend the Member for Salford, West (Mr. Orme) wants us to be brief or to speak for a long time. If my right hon. Friend wants me to speak at length, perhaps he will leave the Chamber now. If he wants me to be brief, perhaps he will stay.
        Mr. Stanley Orme: I will stay.
        4.15 pm
        Mr. Golding: That means that my right hon. Friend wants me to conclude fairly quickly. During the course of

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        our proceedings, I have worried about the relationship that has developed between the Government Whips and my right hon. Friend.
        However, it is important to the POEU that there should be no development that allows cable operators to carry telecommunications traffic. That is vital. If further traffic is taken away from BT, BT's financing would become more and more complex. If we lived in a world of perfect competition, my argument would be different, but does it make sense for the Government to say that further revenues can be taken from BT when it means that access fees elsewhere will have to be increased to fund the uneconomic services? The Government are getting into a tangle. It would be far better if they said that they would not allow private cable operators to carry telephone traffic, regardless of whether Mercury and BT are involved.
        Mr. Kenneth Baker: By "telephone traffic", does the hon. Gentleman mean voice telephony or data transmission as well?
        Mr. Golding: I was speaking specifically of voice traffic. I should like to reserve my position on data traffic because we would need to think that out, but certainly in terms of voice traffic it does not make sense further to deplete the revenues of BT, which then have to be replenished by access fees.
        The Government are in great danger of creating such a complicated system of cross-subsidisation that it will be very difficult indeed to manage the entire system.
        I end on this note, and I end only because my right hon. Friend the Member for Salford, West has decided to stay in the Chamber and wants me to end my contribution.
        Mr. John Grant: I have listened carefully to what the hon. Gentleman has said and I agree with a great deal of it—not least what he said about jobs, because I think that the Government are trying to create the impression that there are many jobs in cable when in fact the reverse is probably the case.
        The hon. Gentleman's amendment, on the face of it, is very sweeping. It talks about "running cable systems". What does the hon. Gentleman mean by that? Does he include a cable station? That is the way it reads to me.
        Mr. Golding: It does not mean running the cable system. I have said—but I was speaking in shorthand at that point—that as a union we believe very strongly in the separation of the physical system and the use of that system. To us that is absolutely imperative. It would be disastrous if BT, Mercury or any other operator of a telecommunications system that started broadcasting became responsible for programmes.
        Mr. Kenneth Baker: That is not what the amendment says.
        Mr. Golding: The hon. Gentleman says that that is not what it says, but it is a peg. It is not possible, given our medieval system of parliamentary democracy—which I support—to discuss complicated technological matters with the rationality that we would wish. The amendment is a peg on which to take a vote in principle. It is essential that we in this country do not go along the path of the Government breaking up telecommunications, smashing
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        telecommunications into little bits. We must develop an integrated national system of telecommunications which can carry not only telephony but broadcasting and data.
        Mr. John Browne: The aim of this amendment is to retain a monopoly for British Telecom and its exclusive privileges in relation to the running of cable systems. What the word "running" means, both legally and in commercial practice, I do not really know; it is such a very vague word that I think on those grounds alone this amendment should be voted down by the House. It is far too vague, far too generalised, an amendment to make a serious contribution to the law regarding the future of British Telecom in a most serious and critical clause.
        Let us not dwell on just the meaning of that one word when it is perfectly clear that the basic meaning and aim of this clause is to retain the monopoly of British Telecom at least for the cable industry—or we should probably call it more correctly the videotext industry.
        I believe that monopoly is an abuse of Government power. It is part of the ethos, or the arrogance, of Socialism—the arrogance that says that the State knows better than the individual. I believe that it is very damaging because I see before our country the first and most essential challenge facing all of us. What we do in this House at all times basically comes down to the question, will we as a country retain our standard of living and our standard as a developed country by making it to the technological revolution? That is what this Bill is all about. It is one of the most important aspects of trying to achieve the technological revolution, which is absolutely fundamental to our standard of living and to our future.
        I see Opposition Members shaking their heads, but if we look at the historical evolution of developed societies we must surely see that it is so. In the old days, if we were lucky and had a prince or a general who managed to beat neighbouring countries at war or in the sophisticated trickery of diplomacy, we gained. We were able to use their goods and services to build up our own wealth and therefore be able to afford a higher standard of living than other countries. That was very much a case-by-case difference between developed countries and underdeveloped countries in those days. What really started the major, almost irreversible trend of difference between the developed and the underdeveloped countries was the revolutionary process. First there were the agriculture revolutions, the first being the use of the enclosure system and the second the use of machines on the land. Then we had the industrial revolutions—first the heavy industry revolution and then the light industry revolution. Now we have the technological revolution. As each of these revolutions has taken place the difference between the developed and the underdeveloped countries has become wider.
        I can think of only one country in history that has managed to move from being an underdeveloped nation to being a developed nation without following the normal trend, and that is Japan, but that was for very special reasons.
        Mr. Stan Thorne: I am interested in that line of argument, particularly from the hon. Gentleman, and I am wondering how, as a Christian, he squares the argument that he is developing about the differences between high technology countries and

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        underdeveloped countries and how he will overcome the problem. Does he think that the Bill will help in any way the poor people of Ethiopia?
        Mr. Deputy Speaker: Order. That might be a matter for another debate. Perhaps the hon. Member will confine himself to the amendment.
        Mr. Browne: May I just answer that, Mr. Deputy Speaker, in one sentence, or would that be out of order?
        Mr. Deputy Speaker: It would be out of order.
        Mr. Browne: Then I must take the matter up outside the Chamber with the hon. Member, but I have ideas on that question as well.
        The big thing is that we must remain a developed society and to do that we must embrace the technological revolution. If we do not we shall become an underdeveloped industrial country. Living in our climate, with upwards of 55 million people in a series of overcrowded islands, if we slip to becoming an underdeveloped society we shall find life extremely uncomfortable. Some of the advantages of our developed society are tap water that we can drink, a system of law and order, although under strain, a system of justice, organisation within our cities, food distribution and so on. All those facilities are at stake.
        4.30 pm
        As I have said, the arrogance of Socialism is typified in the attitude or apparent attitude of Socialists. Perhaps the right hon. Member for Salford, West (Mr. Orme) will correct me, but it appears to those outside the Labour party that its attitude to the technological revolution is to say—"We cannot make it and we do not want a technological revolution in Britain, therefore we shall resist it." Labour Governments believe that they can isolate Great Britain from the rest of the world.
        Mr. Deputy Speaker: Order. I am sorry to interrupt the hon. Gentleman, but will he relate his remarks to the running of cable systems, which is what the amendment is about?
        Mr. Browne: I was trying to paint a picture to show how important it is that this monopoly is not retained. I am coming to cable, but if the monopoly is retained cable systems will be stultified and they are a major force in our achieving a technological revolution. I am trying to make the case as to why we should not allow that monopoly to be retained. Surely I should be allowed to paint the background to my case because this is an important issue.
        I want to illustrate the way in which Socialists have tried to isolate us from the technological revolution, which has led to the monopolies that we are talking about now. I tried to trace the origin of those monopolies because they are so harmful, and to try to explain to the House why we must not allow this monopoly to continue, particularly in an area where we expect enterprise rather than stagnation.
        Let me allude to what many would consider to be an abuse of trade union power in the past 50 years to see where trade unionists have used their power to pressure weak Governments and weak management to make wage awards that are out of proportion to the successful sales of companies. Those wage awards have resulted in investment in wages which should have gone on product design.
        Mr. Orme: On a point of order, Mr. Deputy Speaker. We are dealing with a specific amendment relating to cable
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        systems. The hon. Gentleman has not been present in any of the debates. I do not know whether he is making a speech for his local paper, but it is certainly not directed to the Bill and I ask for the protection of the Chair.
        Mr. Deputy Speaker: I have already interrupted the hon. Member for Winchester (Mr. Browne) on two occasions. Interesting though his speech is, it is probably more relevant to the Third Reading debate than to this amendment. I ask him again if he will please relate his speech to amendment No. 120.
        Mr. Browne: With all due respect, Mr. Deputy Speaker, the right hon. Member for Salford, West (Mr. Orme) says that I have not attended the debates but I did attend the Second Reading debate although I was not on the Committee that has sat for some 160 hours and which included one of the longest speeches, if not the longest speech, ever made in the House. I attended and spoke in the debates on cable systems and that is what this amendment is about. It is a critical element.
        If this monopoly is allowed to exist in the cable industry it will have a devastating effect on the future potential of the cable or videotext industry. We are talking not merely about the cable industry but about the application of a monopoly to it. In building my case to persuade the House to do away with this amendment, surely I should be allowed a reference to the word "monopoly" in addition to the words "cable industry".
        I want to trace the evolution of monopolies because then one realises how harmful they are to Britain and what enormous damage they have done to our industries. A monopoly will do enormous damage to the potential of the cable or videotext industry if it is allowed to continue. The right hon. Gentleman succeeded in quietening hiss hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding), but why should he be allowed to quieten me? Monopolies are a critical element in this argument. Clause 2 is about monopolies and the cable industry.
        As funds were taken from product design, the building of proper quality products, prompt delivery and competitive after-sales service, our sales dropped away. British industry failed to sell its goods in the international markets so it dropped its prices and Governments assisted them by dropping the price of sterling. We ended up producing out-of-date goods that not only would not sell in the international market but would not sell at home either. One has only to look at the computer industry and our car parks to see how many foreign goods are selling in Britain compared to British goods.
        The Socialist response to that fall in sales was first to help boost sales by giving Government orders. Thai was the first step on the slippery slope to monopoly and decay. The second step was to offer massive loans on uncommercial terms to those big industries and companies that were beginning to fail because they had paid too much in wages and were not designing good quality products, delivering on time or producing after-sales services.
        Nationalisation was the next big con trick. All those industries were grouped together and were not lent, but were given, money in grants. The Government's legacy is to have to pump between £6,000 million and £8,000 million a year into those industries. That is the position that we have reached. Those industries are still failing. A Socialist Government created a monopoly to stop any form

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        of competition in Britain. The result of such monopolies is, first, a complete absence of choice for the consumer. If one wants to buy gas in Britain—
        Mr. Orme: On a point of order, Mr. Deputy Speaker. I ask for your guidance again. We are dealing with amendment No. 120, which says:
        "at end insert `, except in relation to running cable systems'."
        I have listened to the hon. Gentleman with some patience and I urge you, Mr. Deputy Speaker, to point out that he is not speaking to the amendment.
        Mr. Deputy Speaker: I was also listening carefully. I have allowed the hon. Member for Winchester (Mr. Browne) considerable latitude in giving the background to his speech on the amendment. However, I say to him again that his speech must be directed to clause 2 and to the words on the Amendment Paper. His speech is far more appropriate to a debate on Third Reading and, if I may advise the hon. Gentleman, that is when it should be made.
        Mr. Browne: I accept that criticism. I shall content myself, therefore, with a brief paragraph on the evils of monopoly and then I shall come to the second part of my speech on cable. The absence of choice means that prices of the monopolies can rise and we can do nothing about it. People have to buy gas from somewhere.
        Mr. Stan Thorne: On a point of order Mr. Deputy Speaker. The hon. Gentleman clearly did not hear what you said and intends to persist in delaying a real discussion of the amendment.
        Mr. Deputy Speaker: I thought I heard the hon. Member for Winchester (Mr. Browne) mention the word "gas". I do not think that the Bill has anything to do with gas. I should like him now to confine himself wholly and exclusively to telecommunications.
        Mr. Browne: Under duress, Mr. Deputy Speaker, I accept your ruling.
        Mr. Deputy Speaker: It is not a question of being under duress. The hon. Gentleman has been here long enough to know that when we have these debates we must stick to the amendment that is on the Amendment Paper, otherwise the debate will become chaotic.
        Mr. Browne: With all due respect, Mr. Deputy Speaker, is this not a clause that involves monopolies? It deals with cable but it is the monopoly in the cable business that I am speaking about. Anyway, I shall not dwell on that. I take your point that you do not wish me to discuss monopolies.
        The Government are seeking to abolish the British Telecom monopoly in most areas of its operations but are making one exception, the cable business. Why should the cable industry be singled out from all the other activities of British Telecom to be left with this legacy around its neck? The cable or the videotext business is a new industry offering an avenue of advance for our country in the technological revolution. The success of the industry will depend on two vital facts. The first is risk-taking; huge amounts of capital must be invested. The second is innovation; if any industry is changing fast, it is the cable industry, with enormous technological changes and advances being made almost every day.
        Will a monopoly, which I tried to describe, be the type of organisation that will take risks? It will have its prices
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        already so there will be no incentive for it to take risks to make any more money. Will a monopoly innovate? The history of British Telecommunications shows a lack of innovation in comparison with its international competitors.
        The main problem facing the fledgling cable industry is financial viability. The videotext business, by its very nature, is highly capital intensive. It is new and therefore high risk. The Government intend to use internal sources of finance and not Government sources to finance the industry. Therefore they must act with great sensitivity. They must ensure that for the success of the industry as few fetters as possible are put on it from the beginning. Therefore, there are no grounds whatsoever to allow a monopoly to exist, let alone to isolate just the cable industry out of all the activities of British Telecommunications and leave that alone to carry the burden of a monopoly.
        May I list some important areas where I should like my hon. Friend to give clearer definitions? On the cable system, could he define more clearly what he means by a franchise? This will have a great bearing on whether or not a monopoly should exist. For how long will the franchises last? Will the present cable operators be given the special privileges they sought in the Hunt report? Can he also say precisely what he means by "interactive" when there is an obligation to provide interactive services? What band widths have the Government in mind that cable operators should budget for in laying the cables?
        4.45 pm
        I agree with the thrust of the Government's policy on things like the "must carry" services and non-exclusive events. The Government should reconsider their views on pay-per-view, on quotas, and on the system of hardware and software for British industry, which the hon. Member for Newcastle-under-Lyme mentioned in his eloquent speech. There is an important issue here, especially when we are talking about British Telecom, the hardware that is in the ground and what has to be laid. We have to strike a balance between past monopolies, which tended to go into the future and stultify innovation, and competition that encourages innovation. We must protect British industry to encourage it to compete in the new industry.
        On British Telecom itself, I approve very much of the privatisation provision in the clause. I should like to place it on record that although I support privatisation we should not knock British Telecom or exclude it from the cable business. My only argument is that we should not grant British Telecom a monopoly. In the opinion of many of those who are interested in the telecommunication and videotext business, British Telecom is amongst the foremost in high technology in communications and particularly in fibre optics, which will play a critical role in the videotext business if my hon. Friend insists on an interactive system with a wide band width.
        British Telecom is also environmentally acceptable. That is a great selling point. I agree with many right hon. and hon. Members on the Opposition Benches that we are all used to seeing British Telecom digging up the streets; we are accustomed to those yellow vans.
        Mr. Deputy Speaker: Order. The hon. Gentleman seems to be under a mistaken belief that we are discussing the motion that the clause stand part. We are on a very

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        narrow amendment concerned with the running of cable systems. The hon. Gentleman must now concentrate on that or bring his remarks to a conclusion.
        Mr. Browne: Very well, Mr. Deputy Speaker, I shall do that. I get the point of your remarks.
        I am trying to say that British Telecom is acceptable and has a significant role to play in the cable industry, but not as a monopoly. I am trying to show that it can play a constructive role. I question why it should have monopoly privileges. British Telecom should be allowed to participate in the growth of the video text business, but as a partner and not as a monopoly owner. That would ensure that innovation and risk-taking were key factors and that there was co-operation within the industry by cable operators, cable producers and cable layers.
        British Telecom has a valuable role to play as a partner. In the initial stages of the take-off of the industry there might be a single organisation in which British Telecom was a partner but which would include the big cable layers and operators and the public as individual shareholders. Such a single organisation would ensure what Opposition Members want—a standardisation of technology within the different sections of the cable business.
        I can understand hon. Gentlemen wanting a monopoly to ensure technological standards throughout the country, but why must it be done through one company? Why cannot we have a single organisation such as the Hudson Bay Company in the cable business? It would ensure that standards of technology were maintained.
        I should like to hear the Minister's comments about the public owning some of the shares in a modern Hudson Bay type of company, which would ensure standards but at the same time introduce innovation and risk-taking. There never was and never will be successful and sustained risk-taking and innovation with a monopoly.
        I believe that it would be wrong and discriminatory for British Telecom to retain a monopoly in the cable business. I believe that it would be against the national interest when competing in the technological revolution, and that there would be no likelihood of success in the cable business because there would be the minimum of risk-taking and innovation and the maximum amount of bureaucracy.
        I urge the Minister to consider establishing a consortium including major and minor interests within the prospective industry and ordinary people in the street and in the corner shop who could invest in a consortium. I believe that would resolve many of the anxieties of right hon. and hon. Gentlemen about standardisation and so forth and also many of my right hon. and hon. Friends' worries about ensuring that the video text and cable business succeeds and contributes to our remaining a developed and high technology society.
        Mr. John McWilliam: I shall be brief, unfortunately, although I have a great deal to say about cable. I must declare an interest as a Member sponsored by the Post Office Engineering Union and also as a telephone engineer with some 20 years' experience. Cable is not an alien world to me. I have worked and dealt with it, and I am fairly familar with the economics of its provision and other aspects with which we should deal but are prevented from dealing with.
        I am pleased to speak after the distinguished speech of the hon. Member for Winchester (Mr. Browne). It was
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        distinguished by its irrelevance and lack of knowledge of what the Bill contains. He talked about a Hudson Bay type of company. The Bill creates a private company and the amendment does not affect that. The speech was based on a lack of knowledge not just of the computer and information technology industry in Great Britain but of the way in which the American Government pour billions and billions of dollars into their industry, which is what we must compete with.
        Mr. Stan Thorne: When the hon. Member for Winchester (Mr. Browne) was speaking, his speech sounded like a brief from IBM. Has IBM an interest in this?
        Mr. McWilliam: My hon. Friend has probably hit the nail on the head, because the arguments adduced by the hon. Member for Winchester are the same as those adduced to me, and I believe other right hon. and hon. Members, by IBM.
        Mr. Charles R. Morris: Can my hon. Friend confirm chat even IBM would not take responsibility for the hon. Gentleman's speech?
        Mr. John Browne rose—
        Mr. McWilliam: I shall not give way. The hon. Gentleman took far too long.
        Mr. Browne rose—
        Mr. McWilliam: I shall not give way to the hon. Gentleman.
        Mr. Deputy Speaker: The hon. Member is not giving way.
        Mr. McWilliam: It would be useful if we could return to the subject of cable. I do not wish to be irrelevant—
        Mr. Browne: On a point of order, Mr. Deputy Speaker.
        Mr. Deputy Speaker: Order. Is it a point of order?
        Mr. Browne: I believe that it is, Mr. Deputy Speaker. The hon. Member for Blaydon (Mr. McWilliam) suggested that my speech had something to do with IBM, and that I had some connection with IBM when writing the speech.
        Mr. Stan Thorne: My hon. friend the Member for Blaydon (Mr. McWilliam) did not say that; I did.
        Mr. Deputy Speaker: Order. That is not a point of order; it is a point of argument.
        Mr. McWilliam: I refused to give way not because I did not wish the hon. Member for Winchester to have the right of reply—plainly he has just replied—but because of the lack of time. I want to make a couple of brief but I believe important points.
        The reason for the amendment is simple. It is to achieve what the Minister is trying to achieve with the licensing policy that he has announced for all cable systems, which is a star-switched method of distribution as the ultimate aim and a star configuration of tree and branch as the intermediate aim for cable systems. The Minister has already provided an incentive for that by the licences that he is granting.
        The Opposition argue a contrary point to that argued by the hon. Member for Winchester. Our argument is that any

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        cable system is a monopoly for the people that it serves. I am talking about the physical system, which is what cable systems mean. The system is independent of the information that it carries, and the information it carries should be provided separately and not by British Telecom. Any individual cable system is a monopoly in the area it covers. The Opposition say that it is wasteful, uneconomic and silly to have the hardware of the cable system provided solely on the basis of pay-TV because the broad band aspects will give us the opportunity to develop the whole range of information technology services that we should like, not just pornographic movies which seem to be the basis of funding in the United States.
        The only way in which the economics of the system will make sense is if it carries not just pay-television but also data transmission systems, information technology, telephone systems and other services such as fire and burglar alarms. We should like to see cable developed on that basis. The Opposition believe that that can be achieved only by British Telecom providing the cables. It will then be able to provide a network of a broad enough band width to meet all the demands. What is more—and the hon. Member for Winchester missed this—the basis of the system is fibre optics, in which there has been British innovation.
        I reject the criticism of British Telecom by the hon. Member for Winchester because British Telecom developed the modern fibre optic cable systems. We should like to see that developed, and we believe that it is possible only if British Telecom retains the monopoly of providing the systems. However, we do not believe that British Telecom should provide any programmes on those systems. For that reason, I commend the amendment to the House.
        Dr. John Cunningham: I believe that everyone has agreed on Second Reading, in Committee and until this afternoon that the prospects of developing cable systems in Great Britain and the opportunities and avenues that will be open for the development of optic fibre cable systems, in particular, present Great Britain with a major industrial opportunity in terms of communications and new services, and prospects for entertainment, leisure activities and the like.
        We agree that those opportunities should be grasped by Britain as a nation, particularly in the industrial sense. We should press ahead to maximise the advantage of our world lead, at least in some aspects of optic fibre technology and the other equipment that goes with it.
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        However, there, I regret, the agreement about the clause and the amendment that we are discussing ends. While we in the Opposition believe that a national strategy is required to maximise those potential benefits and the opportunities, the Government have been more concerned hitherto with a market force, private enterprise approach. That neatly fits in with their philosophy, as our view fits in with our philosophy. We believe not only that a framework to guide industrial policy is required but that proper controls over cable systems are needed for a variety of reasons.
        Therefore, there are fundamental issues that divide us. Those differences in philosophy delineate the dispute between the Tories and the Labour party. That is why the
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        Opposition support amendment No. 120, moved so effectively by my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding).
        This is not a new issue, contrary to what has been asserted by Conservative Members. Debate about cable systems, particularly about cable television and its future, has been going on for some time. We welcome the proposals to expand cable television, provided that they are carried out in a manner that preserves the existing high standards of public service broadcasting and facilitates the creation of one integrated communications system carrying both broadcasting and telecommunication services. That is our aim. The overriding priority is a national network and a national cable system from which private sector operators can benefit. Therefore, contrary to what the hon. Member for Winchester (Mr. Browne) said, we are talking not about an all-pervading monopoly but about one national public network. That is where the hon. Gentleman was fundamentally in error in his argument. We believe that not only—
        Mr. John Browne: Will the hon. Gentleman give way?
        Dr. Cunningham: I shall not give way. The hon. Gentleman made a long speech. I shall be much briefer than him. I know that the Minister wishes to reply at some length, so I am sorry, but I shall not give way.
        We believe that public service broadcasting can be protected only if cable television is subject to an effective system of regulation that limits, for example, advertising and foreign programming. The technical integration of such a broadcasting and telecommunications system is most likely to come about by the deployment of the latest technologies, involving the provision of switched optical fibre systems.
        There is a great deal of public concern, as I believe hon. Members throughout the House realise, about what many people see as a free-for-all in the development of cable television systems. Both the need for regulation and the arguments about technology would best be served by there being a strict separation between the trunk network provider—the operator of the system—and the operators of the networks that would feed from it—the cable television companies themselves. We want British Telecom to have the major role in the former aspect—the provision of cable systems. British Telecom would then lease most, if not all, the channel capacity on those systems to cable operators that were awarded franchises. It could use the remaining cable channels for its own broad band telecommunications needs.
        We think that that is not only the neatest, simplest and most elegant way to provide the network that the country needs, but the best way to proceed in terms of cost benefit for the nation as a whole and the use of the nation's resources. An industrialist of impeccable market credentials, Lord Weinstock, criticised the Government's approach and said that they should avoid the temptation to go for the quick buck option, which was recommended to the Government in the Information Technology Advisory Panel report. We want that report to be rejected by the Government.
        Unfortunately, so far the Government's response to the ITAP report has involved the setting up of the Hunt committee, which was simply an inquiry into the broadcasting implications of cable television. It failed to

        203
        grasp the real scope of the opportunities that we have. It failed to address itself to the broad spectrum of the industrial and entertainment prospects that we should grasp. The committee was disappointing in its guidelines. We have missed the boat before it has even got going.
        The best way to sum up both the ITAP and the Hunt reports is in the old adage: "If I were going to Dublin, I would not start from here."
        Mr. Kenneth Baker: Ballymena.
        Dr. Cunningham: The Minister can have whichever Irish town or city he prefers.
        The Government seem to have started from the wrong point to reach proper, adequate and sensible conclusions about Britain's future needs in this exciting area of cabling and recabling the country.
        I stress that, given adequate safeguards not only for the public but for existing employees, cable expansion could bring enormous benefits to our economy. Handled properly, effectively and correctly, it could enhance the high reputation of British broadcasting, bring new jobs, boost our high technology industries and get us into export markets on a worldwide basis. However, whether any or all of that happens depends on decisions that the Government will take, we assume, in the near future. Again, it is disappointing at least and at worst a matter for concern that the Government have again failed to deliver their promise and come up with a White Paper in time for us to learn their thinking before the conclusion of the consideration of the Bill.
        I regret very much the Government's handling of the consultative stage of the process. Many people regard it as inadequate. The TUC conveyed to the Hunt inquiry and the Prime Minister its criticism of the unrepresentativeness of both ITAP and the Hunt committee. Predictably, it fell on deaf ears. It criticised the inadequacy of the time scale to which Hunt was asked to work and, as I said earlier, the arbitrary and unjustified restriction of Hunt's remit to broadcasting implications alone. I am sorry that we have received no adequate response to these points which have been made time and again.
        With regard to cable itself, there is every sign that the Government are on the brink of two further errors which could have serious consequences. The first concerns the principle of publicly regulated broadcasting. It is no accident that we have a high reputation in this area throughout the world. The underlying reason for that high reputation is public regulation and public accountability. The expansion of cable television represents a major extension of broadcasting into people's homes. The public are entitled to controls on cable television which are no less effective than those on other broadcasting. The Minister of State may not be aware of this, but even now I receive a regular flow of letters from constituents who are worried about obscenity, soft core pornography and excessive violence in the media, and do not want such material on tap—perhaps I should say on ITAP—in their houses. The Government have a serious responsibility in this matter.
        As I have already said, there is also the danger that the Government will fall for the temptation of the "fast buck" solution which has been condemned widely, among others by Lord Weinstock, and opposed and questioned by members of the Confederation of British Industry and others. Cable expansion offers a good chance to show how
        204
        the investment of the nation's wealth can bring real and extensive benefits to both the public and private sectors but it appears that the Government's approach, one guided more by dogma than any sense of an industrial strategy, will prevent Britain maximising the benefits that should accrue. The BBC, the IBA, the CBI, the TUC, and British Telecom and its unions have all expressed opposition to and concern about the Government's stance.
        We believe that the amendment should be accepted because a national network controlled by British Telecom with leasing arrangements to operators would be the best guarantee of success in terms of industrial policy, a national strategy for telecommunicaions and cable, maximising the benefits of investment and job potential, taking the best advantage of our world lead in technology and decent standards and proper public control. So far, on all these tests, Government policy has failed. That is why we shall press the amendment to a vote.
        Mr. Kenneth Baker: We have had an interesting debate on cable. We also had an interesting debate on cable in Committee. That debate was more extensive but that was the way that the Committee operated. We have had two other debates on cable on the Floor of the House. One took place in the late summer of last year and another, more substantive debate in which the House was given an opportunity to discuss the Hunt report, took place on 2 December.
        5.15 pm
        The amendment is technically defective since it refers to cable systems, which are in fact telecommunications systems, but I do not rest my opposition to the amendment on the fact that it is technically defective. I cannot accept the amendment because under clause 2 the exclusive privilege of BT is to be removed along with BT's power to license its competitors, which will mean licensing other telecommunications systems.
        The House is familiar with our reasons for proposing this change in the structure of telecommunications. We believe that competition and diversity are desirable and, indeed, are necessary if the reasonable demands of the people of this country for telecommunications are to be met. Effective competition is not available under the present framework, as my hon. Friend the Member for Winchester (Mr. Browne) pointed out on several occasions in his speech. My hon. Friend's speech was pertinent. I was rather surprised that so many Opposition Members objected to the way in which my hon. Friend developed his arguments. Opposition Members do not have a monopoly of the time for debate.
        In Committee, they tried to monopolise the time for debate. I am glad that a Member who did not serve in Committee has seen fit to speak on Report because so often in our debates on Report that does not happen. The whole concept of Report stage is to bring the Bill back from the experts in Committee to the Floor of the House so that other Members who have not been privileged to serve—or cursed to serve—in Committee can participate. The hon. Member for Westhoughton (Mr. Stott) used that privilege yesterday and, of course, he did not abuse it. Nor did my hon. Friend the Member for Winchester today. Every Member has a right to speak on Report.
        My hon.. Friend the Member for Winchester attacked the concept of monopoly. It is because we believe that competition cannot be effective under the present framework that we intend to change that framework so that

        205
        all future telecommunications services will be licensed by my right hon. Friend the Secretary of State for Industry and will be subject to one regulatory authority—the Office of Telecommunications. The benefits that we know come about when companies are free to respond to the needs of the market will be just as effective in the expansion of local cable networks as in the running of national telecommunications networks. It would be wholly inconsistent for us to remove the exclusive privilege of one area of BT's activity—that is, telecommunications network systems —only to reinforce it in another area—cable television systems. It would be especially damaging to retain BT's monopoly in a sector which shows great promise of future growth—growth which is likely to be infinitely faster—since monopoly is least satisfactory when it attempts to serve an expanding market. If a monopoly is controlling a static market or even one that is declining, it tends to operate unsatisfactorily, but it is more satisfactory in those circumstances than in an expanding market. The very nature of a monopoly means that it is not flexible enough, quick enough, fast-footed enough and fleet enough to pursue the opportunities that develop, arise and grow when a market is expanding.
        The hon. Member for Newcastle-under-Lyme (Mr. Golding) expressed concern about what would be BT's position when cable systems operate locally across the country. That concern is expressed not only by BT. Mercury has expressed the same concern because it, too, is a public telecommunications operator. It is worried about the effect that local cable networks could have on its operations. Therefore the Government have decided to give BT and Mercury the exclusive privilege of inter-city and inter-network linking of cable systems. If a cable system in Plymouth needs to be linked to one in Leeds, the linking across the country will be done either by BT or by Mercury. Moreover, we have agreed that only where BT and Mercury are involved in the operation of cable systems may a cable operator provide voice telephony services. If a cable operator in Leeds wished to provide voice telephony over its cable system—from the proposals I have seen from various cable consortia, they are not greatly interested in voice telephony as a service at this stage, but they might become so as the technology develops—it would have to incorporate either BT or Mercury into its consortium. If it did not want to do that, it would not have to incorporate either BT or Mercury in the cable consortia for Leeds, Plymouth, Winchester or wherever.
        We do not believe that BT should act as the controlling body for the establishment and operation of cable. That is what the hon. Members for Newcastle-under-Lyme and Whitehaven (Dr. Cunningham) want. It is in the interests of the consumer and the cable providers and operators that such a task should be the responsibility of a new, independent statutory cable authority, as recommended in the Hunt report. The authority will exercise considerable influence through its responsibilities for considering applications and awarding franchises for cable operators. I emphasise that that will not be for cable provision. The House is familiar with the distinction between the two.
        The Opposition want a firm distinction to be drawn between cable provision and cable operation because it is the most effective way to plead BT's case—that it should be the sole cable provider and layer of cable across the
        206
        country and that there should be a separate function for cable operation, that being the transmission of interactive and entertainment services. We do not believe that there should be such a strict dichotomy. It is better for the market to decide whether a certain consortium should do one or the other, or straddle both activities. We have already announced that principle.
        The Opposition are trying to preserve the privilege of a narrow interest group in attempting to preserve the monopoly for BT. The parties below the Gangway, if they support that view, should appreciate exactly what they are supporting. I do not know to what extent they can appreciate the technicalities. We do not expect them to do so, but they should at least understand the principles for which they are being asked to vote. They are being asked to extend a monopoly. That is not a liberal principle—
        Mr. David Penhaligon rose—
        Mr. Baker: Ah, a Liberal spokesman.
        Mr. Penhaligon: Will the Minister outline his qualifications for speaking in the House on technical matters?
        Mr. Baker: I always look forward to any statement of policy from the Liberal party on any technological matter. I find it extraordinary that the Liberal party, on the most important technological Bill of the Session, did not see fit to ask a member of its party to serve on the Committee. That showed the Liberals' indifference to the whole area of technological activity—the fastest growing area in both our country and the western world. The Liberal party, through its absence, has shown that it has no policy or interest in the subject.
        The hon. Gentleman's party is being invited to support the extension of the monopoly that BT currently enjoys. The Bill will end that monopoly. It will end the exclusive privilege of BT's workers to be the only workers in the country allowed to provide telecommunications services. I would have thought that the Liberal and SDP parties would have been only too keen to support the Bill.
        The amendment seeks to extend that monopoly to the whole of cable television so that every town, village and city can be cabled up only by BT. Is that what the Liberal and SDP parties want? They have not given any thought to the matter. I know what the Labour party policy is because it published a document today. It, at least, contained 71 words about telecommunications-71 words about one of the fastest-growing and largest industries in the country. It stated:
        "A national cable system will make possible a wide range of new telecommunications services, greater variety in the provision of television, and a major stimulus to British technology and industry. But it must be under firm public control."
        Mr. John Grant rose—
        Mr. Baker: I shall not give way. The hon. Gentleman must listen to all of the 71 words. He will vote for the amendment later. He voted for such a policy when he was a member of the Labour party. He will now vote for it today even though he is no longer a member of the Labour party. The document continued:
        "A publicly-owned British Telecommunications will thus be given the sole responsibility to create a national, broadband network (including Mercury, the new privately-owned telecommunications system for business)"

        207
        That will also be swept up, nationalised, and pushed into the broad band cable network. Opposition parties below the Gangway will support that. The document continued:
        "which integrates telecommunications broadcasts."
        We know what the Labour party wants. It is consistent. I hope to find out what the SDP wants.
        Mr. John Grant: I find the Minister's statement extraordinary. I thought that we were debating the Bill, not Labour party policy. The SDP has made its position clear about the Bill. We shall not support the amendment, but we shall not support the Government either. Neither side of the House will have the opportunity to gang up. The Minister criticised Labour party policy, but we have not yet seen the Government's policy on paper. We are still waiting for the White Paper. When we see the whites of their eyes, we shall make our decision.
        Mr. Baker: The attitude of SDP Members is clear. They do not like what the Labour party is saying because it is too clear, they do not like what the Conservative party is saying because that is too clear—both are too clear, so they want us to join them in the fog in the middle. Their policy is impenetrable.
        A cartoon exhibition at the Royal Festival hall shows a cartoon of the SDP by Gerald Scarfe—it is a beautiful glass case with the letters "SDP" in it, and nothing else. That summarises the whole attitude of the parties below the Gangway.
        The Government are opposed to the telecommunications monopoly. It is a black and white issue. One either wants BT to have a monopoly or one does not. Abstention cannot be justified on this amendment. There is a choice, and choices must be made, it is no good the SDP always saying that the two parties gang up on it—for example, that the electors of Darlington ganged up. It is an absurd proposition.
        It will no doubt please the hon. Member for Newcastle-under-Lyme to know that I acknowledge that BT has much to offer, both in expertise and in its network of ducts. Since the introduction of competition, it has become a more commercially minded organisation. We believe that as many people as possible should be involved. The Hunt report recommended that we should not specify too closely the technology that should be used. There are two technologies for cable, the star system and the tree and branch system.
        I shall not delay the House by speaking about those systems, although I should be delighted to expatiate at great length on their different characteristics. Suffice it to say that technological changes are happening so rapidly that the developments on tree and branch technology, which is the older technology invented in Britain, give it many of the characteristics of the star system.
        As I said in the debate on 2 December, the eventual technological drift will be towards the star-switched system. We have devised a system to encourage that. At the same time, we do not wish to choke the possibility of certain cable consortia laying tree and branch systems that are capable of being upgraded to star systems. I am especially concerned that we should enhance British technology and industry.
        One reason why I am such an enthusiast for cable television and broad band cable networks is that I look upon that as a tremendous opportunity for Britain that will create jobs for British workers. I have not been elected to create jobs in Detroit, Michigan or Chicago, I have been
        208
        elected to try to promote jobs and activity in Britain. I assure the Opposition that one of the greatest areas of opportunity lies in building cable networks. That is agreed by everyone who has thought about it, but not by the Social Democrats. Neutrality and abstention do not involve commitment, but they are what we shall get from the two parties below the Gangway opposite today.
        5.30 pm
        The potential is vast. I want as many British firms as possible to be involved. There are great opportunities in the United Kingdom, not only in the development of equipment and the laying of systems, but in export potential. One of the reasons why I am so keen to press ahead quickly and strongly with cable is that we are now moving more rapidly than France, Germany or any other country on the continent. If we can build a technological base in cable in Britain in the next two to three years, we shall have an immense export potential. That is broadly agreed upon by hon. Members on both sides of the House.
        The opportunities exist. That is why we commissioned the ITAP report, which was published just a year ago. I strongly reject any criticism of it. It provided the essential stimulus to ensure that the movement started rolling. I also strongly resent criticisms of the Hunt report. It is a distinguished and authoritative report, which will be seen in the history of the cable revolution as it develops as a significant report that set out the broad guidelines that will allow us to expand.
        Although some people are sceptical about cable, investors in private industry are not. Consortia for the cabling of our major cities such as Birmingham, Liverpool and Glasgow are already forming. I emphasise that the technology is being developed in Britain. I am proud of that. Thorn EMI is adapting Teletext technology for encryption and addressability, which are two important parts of cable systems as they provide the ability to send a message to a subscriber and ensure that that message is secure. That is fundamental with electronic funds transfer, home banking or anything of that type.
        Racal has already announced that it is tying up with Oak Industries of California for installation, running and peripheral technology for cable. The Quantel company, which is a world leader in certain types of television equipment and which employs many hundreds of people, is tying up with Cabletime of California and advancing proposals and technology for using the existing network of drains and sewers for cable provision. Many other companies are working up plans.
        In the past month, I have spoken to all the major British companies in this business such as GEC, Plessey, Ferranti and those that I have mentioned, and asked them what they are doing. I assure the House that a great deal of research and development work is taking place in British industry. That would not have happened if we had sat on our hands a year ago and not published the ITAP report or pressed ahead and published the Hunt report.
        I want the greatest possibilities for opportunity to exist:. We therefore strongly oppose the argument that the business should be left entirely in the hands of BT. We have said that if BT wants to be a member of a consortium to cable Plymouth, Leeds or Basingstoke, for example, it can but it will not be given a prescriptive right to do so. There will be choice. If a consortium to cable a town or city wants to involve BT it can do so, but such

        209
        involvement will not be compulsory. BT brings a lot to the table in any negotiations on these matters. I am sure that that decision is correct.
        Some people who are thinking about whether BT should be involved in cable consortia will be paying close attention to the attitude that is taken by the Post Office Engineering Union soon about interconnecting. If the main union in BT is rash enough not to interconnect Mercury, what guarantee will there be that it will not use the same practices and take the same attitudes when it is involved in cable consortia? No investors would want to go into any consortium with that threat overhanging them. I hope, therefore, that wiser counsels will prevail.
        The Government are committed to helping all of that to happen and to creating the right regulatory climate for companies to grow. BT will be involved but we do not want to make an exclusive right. I am against exclusive rights and the vested privilege of some groups of workers to be the only ones who should provide such services. The White Paper will be published shortly after Easter. It will describe our further views on regulations and set out the Government's attitude to the various points that my hon. Friend the Member for Winchester has raised on such issues as franchises, pay-per-view and quotas.
        Above all, we want to keep up the momentum that has been generated in the past 18 months. Our decision to introduce competition in, for example, cellular radio is likely to make us the first in Europe with a national network. That means opportunities for British industry. We want that type of opportunity to be seized with regard to cable. I am sure that it can be grasped much more effectively if there is choice and variety rather than a monopoly by BT.
        Question put, That the amendment be made:
        The House divided: Ayes 194, Noes 288.

        Division No. 105]

        [5.36 pm

        AYES

        Abse, Leo

        Cowans, Harry

        Adams, Allen

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

        Allaun, Frank

        Crowther, Stan

        Anderson, Donald

        Cryer, Bob

        Archer, Rt Hon Peter

        Cunningham, Dr J. (W'h'n)

        Ashley, Rt Hon Jack

        Dalyell, Tam

        Atkinson, U. (H'gey.)

        Davidson, Arthur

        Bagier, Gordon AT.

        Davies, Rt Hon Denzil (L'lli)

        Barnett, Guy (Greenwich)

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

        Barnett, Rt Hon Joel (H'wd)

        Deakins, Eric

        Benn, Rt Hon Tony

        Dean, Joseph (Leeds West)

        Bennett, Andrew (St'kp't N)

        Dewar, Donald

        Bevan, David Gilroy

        Dixon, Donald

        Bidwell, Sydney

        Dormand, Jack

        Booth, Rt Hon Albert

        Douglas, Dick

        Boothroyd, Miss Betty

        Dubs, Alfred

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

        Duffy, A. E. P.

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

        Dunnett, Jack

        Brown, Ron (E'burgh, Leith)

        Dunwoody, Hon Mrs G.

        Buchan, Norman

        Eadie, Alex

        Callaghan, Rt Hon J.

        Eastham, Ken

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

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

        Campbell, Ian

        English, Michael

        Campbell-Savours, Dale

        Evans, loan (Aberdare)

        Canavan, Dennis

        Evans, John (Newton)

        Cant, R. B.

        Faulds, Andrew

        Carter-Jones, Lewis

        Field, Frank

        Clark, Dr David (S Shields)

        Fitt, Gerard

        Clarke Thomas (C'to'dge, A'rie)

        Ford, Ben

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

        Forrester, John

        Conlan, Bernard

        Foster, Derek

        Cook, Robin F.

        Foulkes, George

        210

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

        Oakes, Rt Hon Gordon

        Freeson, Rt Hon Reginald

        O'Brien, Oswald (Darlington)

        Garrett, John (Norwich S)

        O'Halloran, Michael

        Garrett, W. E. (Wallsend)

        O'Neill, Martin

        George, Bruce

        Orme, Rt Hon Stanley

        Gilbert, Rt Hon Dr John

        Palmer, Arthur

        Golding, John

        Park, George

        Gourlay, Harry

        Parker, John

        Graham, Ted

        Parry, Robert

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

        Pavitt, Laurie

        Hardy, Peter

        Pendry, Tom

        Harrison, Rt Hon Walter

        Powell, Raymond (Ogmore)

        Hart, Rt Hon Dame Judith

        Prescott, John

        Hattersley, Rt Hon Roy

        Price, C. (Lewisham W)

        Haynes, Frank

        Race, Reg

        Healey, Rt Hon Denis

        Rees, Rt Hon M (Leeds S)

        Heffer, Eric S.

        Roberts, Albert (Normanton)

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

        Roberts, Ernest (Hackney N)

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

        Roberts, Gwilym (Cannock)

        Home Robertson, John

        Rooker, J. W.

        Homewood, William

        Rowlands, Ted

        Hooley, Frank

        Sever, John

        Hoyle, Douglas

        Sheerman, Barry

        Huckfield, Les

        Shore, Rt Hon Peter

        Hughes, Mark (Durham)

        Silverman, Julius

        Hughes, Robert (Aberdeen N)

        Skinner, Dennis

        Hughes, Roy (Newport)

        Smith, Rt Hon J. (N Lanark)

        Jay, Rt Hon Douglas

        Snape, Peter

        John, Brynmor

        Soley, Clive

        Johnson, James (Hull West)

        Spearing, Nigel

        Johnson, Walter (Derby S)

        Spriggs, Leslie

        Jones, Barry (East Flint)

        Stallard, A. W.

        Kaufman, Rt Hon Gerald

        Stewart, Rt Hon D. (W Isles)

        Kerr, Russell

        Stott, Roger

        Kilfedder, James A.

        Strang, Gavin

        Kilroy-Silk, Robert

        Straw, Jack

        Lamond, James

        Summerskill, Hon Dr Shirley

        Leadbitter, Ted

        Taylor, Mrs Ann (Bolton W)

        Leighton, Ronald

        Thomas, Dafydd (Merioneth)

        Lestor, Miss Joan

        Thomas, Dr R.(Carmarthen)

        Litherland, Robert

        Thome, Stan (Preston South)

        Lofthouse, Geoffrey

        Tilley, John

        Lyon, Alexander (York)

        Tinn, James

        McCartney, Hugh

        Torney, Tom

        McElhone, Mrs Helen

        Varley, Rt Hon Eric G.

        McGuire, Michael (Ince)

        Wainwright, E.(Dearne V)

        McKay, Allen (Penistone)

        Warden, Gareth

        McKelvey, William

        Weetch, Ken

        MacKenzie, Rt Hon Gregor

        Welsh, Michael

        McNamara, Kevin

        White, Frank R.

        McTaggart, Robert

        White, J. (G'gow Pollok)

        McWilliam, John

        Whitehead, Phillip

        Marks, Kenneth

        Whitlock, William

        Marshall, D(G'gow S'ton)

        Wig ley, Dafydd

        Marshall, Dr Edmund (Goole)

        Willey, Rt Hon Frederick

        Marshall, Jim (Leicester S)

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

        Mason, Rt Hon Roy

        Wilson, Gordon (Dundee E)

        Maynard, Miss Joan

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

        Meacher, Michael

        Wilson, William (C'try SE)

        Mikardo, Ian

        Winnick, David

        Millan, Rt Hon Bruce

        Woodall, Alec

        Mitchell, Austin (Grimsby)

        Woolmer, Kenneth

        Morris, Rt Hon A. (W'shawe)

        Young, David (Bolton E)

        Morris, Rt Hon C. (O'shaw)

        Morton, George

        Tellers for the Ayes:

        Mulley, Rt Hon Frederick

        Mr. James Hamilton and

        Newens, Stanley

        Mr. Lawrence Cunliffe.

        NOES

        Alexander, Richard

        Banks, Robert

        Alison, Rt Hon Michael

        Beaumont-Dark, Anthony

        Alton, David

        Beith, A. J.

        Amery, Rt Hon Julian

        Bendall, Vivian

        Ancram, Michael

        Benyon, Thomas (A'don)

        Arnold, Tom

        Benyon, W. (Buckingham)

        Aspinwall, Jack

        Berry, Hon Anthony

        Atkins, Rt Hon H.(S'thorne)

        Best, Keith

        Atkinson, David (B'm'th,E)

        Bevan, David Gilroy

        Baker, Kenneth(St.M'bone,)

        Biffen, Rt Hon John

        Baker, Nicholas (N Dorset)

        Biggs-Davison, Sir John

        211

        Blackburn, John

        Grimond, Rt Hon J.

        Blaker, Peter

        Grist, Ian

        Bonsor, Sir Nicholas

        Grylls, Michael

        Boscawen, Hon Robert

        Hamilton, Hon A.

        Bottomley, Peter (W'wich W)

        Hamilton, Michael (Salisbury)

        Bowden, Andrew

        Hampson, Dr Keith

        Boyson, Dr Rhodes

        Hannam,John

        Braine, Sir Bernard

        Haselhurst, Alan

        Bright, Graham

        Havers, Rt Hon Sir Michael

        Brinton, Tim

        Hawkins, Sir Paul

        Brittan, Rt. Hon. Leon

        Hawksley, Warren

        Brooke, Hon Peter

        Henderson, Barry

        Brown, Michael(Brigg & Sc'n)

        Heseltine, Rt Hon Michael

        Browne, John (Winchester)

        Hicks, Robert

        Bryan, Sir Paul

        Higgins, Rt Hon Terence L.

        Buchanan-Smith, Rt. Hon. A.

        Hill, James

        Buck, Antony

        Hogg, Hon Douglas (Gr'th'm)

        Budgen, Nick

        Holland, Philip (Carlton)

        Burden, Sir Frederick

        Hooson, Tom

        Butcher, John

        Hordern, Peter

        Carlisle, John (Luton West)

        Howell, Rt Hon D. (G'ldfd)

        Carlisle, Kenneth (Lincoln)

        Howell, Ralph (N Norfolk)

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

        Howells, Geraint

        Channon, Rt. Hon. Paul

        Hughes, Simon (Bermondsey)

        Chapman, Sydney

        Hunt, David (Wirral)

        Churchill, W. S.

        Hunt, John (Ravensbourne)

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

        Irvine, RtHon Bryant Godman

        Clark, Sir W. (Croydon S)

        Irving, Charles (Cheltenham)

        Clarke, Kenneth (Rushcliffe)

        Jenkin, Rt Hon Patrick

        Clegg, Sir Walter

        Jessel, Toby

        Cockeram, Eric

        Johnston, Russell (Inverness)

        Colvin, Michael

        Jopling, Rt Hon Michael

        Cormack, Patrick

        Joseph, Rt Hon Sir Keith

        Corrie, John

        Kaberry, Sir Donald

        Costain, Sir Albert

        Kellett-Bowman, Mrs Elaine

        Critchley, Julian

        Kershaw, Sir Anthony

        Crouch, David

        King, Rt Hon Tom

        Dickens, Geoffrey

        Kitson, Sir Timothy

        Dorrell, Stephen

        Knight, Mrs Jill

        Douglas-Hamilton, Lord J.

        Knox, David

        Dover, Denshore

        Lang, Ian

        du Cann, Rt Hon Edward

        Langford-Holt, Sir John

        Dunn, Robert (Dartford)

        Latham, Michael

        Durant, Tony

        Lee, John

        Dykes, Hugh

        Le Merchant, Spencer

        Edwards, Rt Hon N. (P'broke)

        Lennox-Boyd, Hon Mark

        Eggar, Tim

        Lester, Jim (Beeston)

        Eyre, Reginald

        Lloyd, Ian (Havant & W'loo)

        Fairbairn, Nicholas '

        Lloyd, Peter (Fareham)

        Fairgrieve, Sir Russell

        Loveridge, John

        Faith, Mrs Sheila

        Luce, Richard

        Farr, John

        Lyell, Nicholas

        Fell, Sir Anthony

        Mabon, Rt Hon Dr J. Dickson

        Fenner, Mrs Peggy

        Macfarlane, Neil

        Finsberg, Geoffrey

        MacGregor, John

        Fisher, Sir Nigel

        MacKay, John (Argyll)

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

        Macmillan, Rt Hon M.

        Fletcher-Cooke, Sir Charles

        McNair-Wilson, M. (N'bury)

        Forman, Nigel

        McNair-Wilson, P. (New Fst)

        Fox, Marcus

        McQuarrie, Albert

        Fraser, Rt Hon Sir Hugh

        Madel, David

        Fraser, Peter (South Angus)

        Major, John

        Fry, Peter

        Marland, Paul

        Gardiner, George (Reigate)

        Marlow, Antony

        Gardner, Sir Edward

        Marshall, Michael (Arundel)

        Garel-Jones, Tristan

        Marten, Rt Hon Neil

        Gilmour, Rt Hon Sir Ian

        Mates, Michael

        Glyn, Dr Alan

        Maude, Rt Hon Sir Angus

        Goodhart, Sir Philip

        Mawby, Ray

        Goodhew, Sir Victor

        Mawhinney, Dr Brian

        Goodlad, Alastair

        Maxwell-Hyslop, Robin

        Gorst, John

        Mayhew, Patrick

        Gow, Ian

        Mellor, David

        Gower, Sir Raymond

        Meyer, Sir Anthony

        Grant, Sir Anthony

        Miller, Hal (B'grove)

        Gray, Rt Hon Hamish

        Mills, Iain (Meriden)

        Greenway, Harry

        Mills, Sir Peter (West Devon)

        Grieve, Percy

        Mitchell, David (Basingstoke)

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

        Moate, Roger

        Griffiths, Peter (Portsm'th N)

        Monro, Sir Hector

        212

        Montgomery, Fergus

        Speed, Keith

        Moore, John

        Speller, Tony

        Morris, M. (N'hampton S)

        Spence, John

        Morrison, Hon C. (Devizes)

        Spicer, Jim (West Dorset)

        Morrison, Hon P. (Chester)

        Spicer, Michael (S Worcs)

        Mudd, David

        Sproat, Iain

        Murphy, Christopher

        Squire, Robin

        Myles, David

        Stainton, Keith

        Neale, Gerrard

        Stanbrook, Ivor

        Needham, Richard

        Stanley, John

        Nelson, Anthony

        Steel, Rt Hon David

        Neubert, Michael

        Steen, Anthony

        Newton, Tony

        Stevens, Martin

        Onslow, Cranley

        Stewart, A.(E Renfrewshire)

        Oppenheim, Rt Hon Mrs S.

        Stewart, Ian (Hitchin)

        Osborn, John

        Stokes, John

        Page, John (Harrow, West)

        Stradling Thomas, J.

        Page, Richard (SW Herts)

        Tapsell, Peter

        Parkinson, Rt Hon Cecil

        Taylor, Teddy (S'end E)

        Patten, Christopher (Bath)

        Temple-Morris, Peter

        Pattie, Geoffrey

        Thatcher, Rt Hon Mrs M.

        Pawsey, James

        Thomas, Rt Hon Peter

        Percival, Sir Ian

        Thompson, Donald

        Peyton, Rt Hon John

        Thome, Neil (llford South)

        Pink, R. Bonner

        Thornton, Malcolm

        Pitt, William Henry

        Townend, John (Bridlington)

        Pollock, Alexander

        Townsend, Cyril D, (B'hoath)

        Porter, Barry

        van Straubenzee, Sir W.

        Prentice, Rt Hon Reg

        Vaughan, Dr Gerard

        Price, Sir David (Eastleigh)

        Viggers, Peter

        Proctor, K. Harvey

        Waddington, David

        Raison, Rt Hon Timothy

        Wainwright, R.(Colne V)

        Rathbone, Tim

        Waldegrave, Hon William

        Rhodes James, Robert

        Walker, Rt Hon P.(Wcoster)

        Rhys Williams, Sir Brandon

        Walker, B. (Perth)

        Ridley, Hon Nicholas

        Walker-Smith, Rt Hon Sir D.

        Ridsdale, Sir Julian

        Wall, Sir Patrick

        Rippon, Rt Hon Geoffrey

        Waller, Gary

        Roberts, Wyn (Conway)

        Walters, Dennis

        Ross, Stephen (Isle of Wight)

        Ward, John

        Rossi, Hugh

        Warren, Kenneth

        Rost, Peter

        Watson, John

        Royle, Sir Anthony

        Wells, Bowen

        Sainsbury, Hon Timothy

        Wells, John (Maidstone)

        St. John-Stevas, Rt Hon N.

        Wheeler, John

        Shaw, Giles (Pudsey)

        Whitelaw, Rt Hon William

        Shaw, Sir Michael (Scarb')

        Whitney, Raymond

        Shelton, William (Streatham)

        Wiggin, Jerry

        Shepherd, Colin (Hereford)

        Williams, D.(Montgomery)

        Shepherd, Richard

        Wolfson, Mark

        Silvester, Fred

        Young, Sir George (Acton)

        Sims, Roger

        Skeet, T. H. H.

        Tellers for the Noes:

        Smith, Cyril (Rochdale)

        Mr. Carol Mather and

        Smith, Tim (Beaconsfield)

        Mr. John Cope.

        Question accordingly negatived.
        Mr. Kenneth Baker: I beg to move amendment No. 2, in page 3, line 14, leave out '46' and insert '47'.
        Mr. Deputy Speaker: With this is will be convenient to take Government amendments Nos. 3 and 4.
        Mr. Baker: These three amendments are a consequence of the removal from the Bill in Committee of a clause which made it an offence for a person to affix advertisements or notices to the property of a public telecommunications operator. The Committee considered that such notices were often a help rather than a hindrance to the public, but also noted that there were provisions in the Town and Country Planning Act 1968 that could be used to control the fixing of notices. I agreed with the Committee that the retention of this criminal offence was undesirable.
        Amendment agreed to.
        Amendments made: No. 3, in page 3, line 22, leave out `and'.
        No. 4, in page 3, line 23, at end insert
        'and section 46 (prohibition of affixing placards etc. on British Telecommunications' property).'—[Mr. Kenneth Baker.]

      Clause 3
        GUIDELINES FOR SECRETARY OF STATE AND DIRECTOR
        Amendment made: No. 5, in page 3, line 24, leave out clause 3.—[Mr. Kenneth Baker.]
      Clause 4

        MEANING OF "TELECOMMUNICATION SYSTEM" AND RELATED EXPRESSIONS
        Amendment proposed: No. 6, in page 4, line 32, leave out 'services" means services' and insert 'service" means a service'.—[Mr. Butcher.]
        Mr. Teddy Taylor: I have not said a word on the Bill so far, but I wish to ask the Minister some questions on this amendment. It changes the word "services" to "service". Does this have the effect of denying BT's right to operate the interference contract, which employs about 280 people in looking, for example, for illegal CB radio? I ask this because I have just been advised today that an announcement was made that in December 1982, BT gave 12 months' notice to the Home Office of withdrawal from its contract.
        There are about 280 people employed in this service, many of them in Southend-on-Sea. If the Minister cannot give me a reply now, will he drop me a note to say whether this is the case, whether there will be consultations with the men concerned and whether he will give an assurance that in the changeover there will be fair and proper consultations with the men who have worked at a good job for a long time and given excellent service, so that they will know what will happen to their jobs?
        Mr. Golding: The Post Office Engineering Union is opposed to what BT has proposed. It believes that radio investigation work is best done by the men who have done it so well for so many years.
        The Under-Secretary of State for Industry (Mr. John Butcher): The amendment is not relevant to the inquiries that my hon. Friend the Member for Southend, East (Mr. Taylor) has made. However, as you have given us this opportunity, Mr. Deputy Speaker, I congratulate him on spotting this topical matter. I am delighted to take up his offer to write to him about the guarantees that he requires on fair and proper consulations. I reassure him that this amendment is a minor one, which is there—
        Mr. Teddy Taylor: Is my hon. Friend sure?
        Mr. Butcher: I am absolutely sure. The amendment is there purely for a drafting purpose. My hon. Friend has raised a serious point and I shall endeavour, as a matter of great urgency, to give him the assurances that he requires.
        Amendment agreed to.

      Clause 7

        POWER TO LICENSE SYSTEMS
        Mr. Kenneth Baker: I beg to move amendment No. 7, in page 9, line 1 leave out 'Secretary of State' and insert `grantor'.
        This simply corrects an error not spotted earlier. As drafted, subsection (5) of clause 7 requires the publication of all licences issued under clause 7 by either the Secretary of State or the Director General but only the Secretary of State can decide the manner of such publication. The effect of this amendment is to empower the Director General also to decide on the manner of publication of any licences that he may grant.
        Amendment agreed to.
        Mr. Kenneth Baker: I beg to move amendment No. 8, in page 9, line 4, leave out 'specification'.
        Mr. Deputy Speaker: With this it will be convenient to take Government amendment No. 30.
        Mr. Baker: Amendment No. 8 simply serves to improve the drafting of clause 7(6) by removing the word "specification". This is redundant, as it is already covered by the word "description", and we are seeking to remove superfluous words.
        Amendment No. 30 is a drafting amendment, like amendment No. 8. It seeks to remove the word "specification", which is similarly redundant.
        Amendment agreed to.
        Mr. Golding: I beg to move amendment No. 9, in page 9, leave out lines 8 to 13.
        When shall we see the draft licence?
        Mr. Kenneth Baker: The hon. Member for Newcastle-under-Lyme (Mr. Golding) has made both the longest and the shortest speech in the proceedings on the Bill. There is a vast difference between the two, most of which is best forgotten. I assume that the hon. Gentleman had an intention other than just asking that question in tabling the amendment, which, if it were to be passed, would have a crippling effect on the Bill. I do not know whether he realises that. I shall explain why that is so before coming to the direct question.
        The amendment would delete subsection (8) of clause 7, which ensures that, when the Secretary of State grants the licence which British Telecommunications will need on the appointed day, he need not consult the Director General under subsection (1)(a) of clause 7 or publish a notice under subsection (3) of clause 8. The amendment is therefore superficially attractive as it would oblige the Secretary of State to consult the Director General, to publish a notice inviting representations and objections to the licence and to consider any representations or objections that he receives. I must therefore explain to the House why the amendment would prevent the Bill being put into effect. I trust that the hon. Member will not press it to a Division.
        One of the main purposes of the Bill is to abolish the "exclusive privilege" under which BT operates at present and to ensure that BT, like any other operator, is licensed. The exclusive privilege will, however, end on the appointed day when the Bill—except part IV, the privatisation part—enters into force. On that day BT will start to operate under a licence. Indeed, unless there is a valid licence in force, BT would be committing a criminal

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        offence if it continued to run its system. Consequently the Government must take steps to ensure that the BT licence is validly granted before the appointed day so that it can come into effect on that day. The BT licence cannot come into force a week or a month after the appointed day.
        Part II of the Bill lays down procedures that must be followed before licences are granted under the Bill. These procedures require the Secretary of State, before he grants a licence, to consult the Director General of Telecommunications under clause 7(1)(a) and in the case of licences granted to public telecommunication operators to publish a notice under clause 8(3) so that members of the public and interested parties can make objections. Unless the Secretary of State carries out these procedures—this is the point—before granting a licence, the licence itself will be invalid.
        As I have explained, the BT licence must be granted so that it comes into effect on the appointed day. This means that it must be drafted beforehand. The Director General will, however, be appointed only on that day and clause 8(3) comes into effect only on that day. Consequently, it will he impossible to consult the Director General before the BT licence is granted. It will also be impossible to carry out the procedures laid down in clause 8(3) before the appointed day. That is why clause 7(8) has been included in the Bill.
        Unless clause 7(8), which the amendment seeks to delete, remains in the Bill, a Catch 22 situation would arise. If clause 7(8) is deleted, the Secretary of State would be bound to consult the Director General and to issue a notice inviting public objections and so on. These procedures would take at least eight weeks—28 days for representations to be made and at least that time to consider them. In that period BT would not have a licence and would either operate illegally or not at all. That cannot be allowed. On the other hand, the Secretary of State could attempt to get round the problem by issuing the licence without consulting the Director General or publishing a notice inviting representations but, if he did this, the validity of the BT licence could be challenged. This also cannot be allowed. Clause 7(8) therefore allows the Secretary of State to grant BT's licence without going through these procedures. It is essential that it remains in the Bill. I hope that the hon. Member will withdraw his amendment.
        The hon. Gentleman asked me when we will see the BT licence. I know that in Committee the Opposition made great play of this point when they were deliberately trying to obstruct progress on the Bill. They successfully wasted much time talking about the licence but the House will realise that that criticism was unsubstantiated.
        Throughout the preparation of the Bill the Government have been at pains to make information available to the House and the Committee. When the Bill was published we circulated a detailed note to describe the regulatory arrangements. We went on to publish on 25 January, during the Committee stage of the Bill, our detailed proposals for the BT licence, and we invited comments on our proposals. We described our views as "preliminary" because we had no wish to publish hard and fast views on what we intended the licence to contain before we heard what interested parties thought. Indeed, I should have been open to considerable criticisms if I had slapped the licence on the Committee table and said, "There it is." Instead, we described our proposals in everyday English, not in legal jargon, and invited comments and criticisms. In
        216
        practice, our preliminary document, in simple non-legal English, may be more detailed than the final licence issued to BT.
        6 pm
        When we are distanced by time from the Committee stage I think it will be seen that we acted in the best way. We tried to act in a way that was open, and the preliminary proposals that we had for the licence have been subject to much debate in this House. Many hon. Members have commented on them. I am sure that that was the sensible way to proceed.
        We explained carefully that our proposals could not be in a final form because the House would want to amend the Bill, which would make it necessary to amend our proposals for the licence. Yesterday the House agreed to a modified clause 3, which will have an impact on the licence. We also explained that we wanted to take account of the views of other interested parties. We are now receiving many helpful comments, some of them including new points, and we intend to consider them carefully. However, we have not yet received cornments from all interested parties. For example, I still await comments from the British Telecommunications Unions committee. I have had comments from the Post Office Engineering Union committee, but I have not yet received comments from the Union of Communication Workers, of which the right hon. Member for Manchester, Openshaw (Mr. Morris) is a member and a strong supporter. Moreover, I am sure that Opposition Members would want me to listen to their views before I take a final decision and before the licence is translated into legal terminology. I also want to take particular account of the views of the National Farmers Union and of organisations representing the disabled. I do not intend to draft the final licence until I know their detailed views.
        I expect to complete my consideration of representations by about the end of May, and to commence detailed drafting of the legal licence document in June. A draft of the legal licence document will be circulated widely and copies of the draft legal licence document will be placed in the House before the summer recess.
        Mr. Golding: Now that I learn that this amendment would scupper the Bill, how could it possibly be withdrawn?
        Amendment negatived.

      Clause 8

        CONDITIONS OF LICENCES
        Amendment made: No. 10, in page 9, line 17, leave out from 'the' to 'above' in line 18 and insert
        `the duties imposed on him by section (General duties of Secretary of State and Director).'—[Mr. Kenneth Baker.]

      Clause 9

        THE TELECOMMUNICATIONS CODE
        Mr. Butcher: I beg to move amendment No. 104, in page 11, line 33, leave out 'limiting' and insert 'qualifying'.
        Mr. Deputy Speaker: With this, it will be convenient to take Government amendments Nos. 105 and 106.
        Mr. Butcher: Amendment 104 is a drafting amendment. Clause 9(3) provides that where a person is

        217
        licensed to operate the telecommunications code, the licence shall have effect with such exceptions and subject to such conditions as may be specified for the purpose of limiting the rights exercisable by that person by virtue of the code. The amendment replaces the word "limiting" with "qualifying", which it is felt is a more appropriate word in this context.
        The provision inserted by amendment No. 105 enables the Secretary of State to require a public telecommunications operator authorised to operate the telecommunications code to place a bond with a person nominated by the Secretary of State. In the event of the liquidation of such an operator, the financial resources required, for instance, to remove apparatus abandoned by the operator or to reinstate a road surface dug up by the operator would then be available.
        Amendment No. 106 merely replaces the tail end of clause 9(3), which is deleted by amendment No. 105, in a new subsection of clause 9.
        Amendment agreed to.
        Amendments made: No. 105, in page 11, line 34, leave out from 'code' to end of line 37 and insert—
        '(3A) Without prejudice to the generality of subsection (3) above, the conditions there mentioned may include such conditions as appear to the Secretary of State to be expedient for the purpose of securing that funds are available for meeting such liabilities of the person to whom the code is applied as may arise from the exercise by that person of rights conferred by or in accordance with the code.
        (3B) The Secretary of State may assign to the Director, for the purposes of any condition falling within subsection (3A) above, such functions as he thinks fit; and, any such condition may impose on the person to whom the telecommunications code is applied a requirement from time to time to make or to vary financial arrangements in accordance with directions given by a person and in a manner specified in the condition.'.
        No. 106, in page 12, line 42, at end insert—
        '(7A) In exercising the powers conferred on him by virtue of this section, the Secretary of State shall have regard to the need to protect the environment.'.—[Mr. Butcher.]

      Clause 10

        MODIFICATION OF LICENCE CONDITIONS BY AGREEMENT
        Mr. Kenneth Baker: I beg to move amendment No. 11 in page 13, line 37, at end insert—
        '( ) it appears to him that the modification should be made, if at all, under section 13 below;'.
        This is a more significant amendment. In Committee, the proposals for the amendment of telecommunication licences came under detailed scrutiny. We spent a considerable time debating them. As a result, we promised to make a few changes in the Bill.
        It may be helpful if I remind hon. Members that telecommunication licences can be amended in two ways. First, if the Director General and the licensee agree that an amendment is desirable, the director can amend the licence under clause 10, after publishing his intention and taking account of representations. Second, if the licensee does not agree to an amendment proposed by the director, or if the director wants a second opinion, the director can make a reference to the Monopolies and Mergers Commission under clause 11. If the MMC concludes that a matter specified in the reference operates against the public interest, the director is obliged to amend the licence under clause 13 so as to remedy the adverse effects.
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        Hon. Members will have noted that, in general, the director alone has responsibility for amending licences, without reference to the Secretary of State. We have argued throughout that that is one of the Bill's strong advantages, because we do not want successive Ministers, of whichever Administration may come to power, to change the basic licence conditions. However, the Secretary of State can give a direction to stop the amendment of a licence in limited circumstances—in the interests of national security or relations with overseas Governments, or when the amendment concerns conditions in the telecommunications code that are likely to be about environmental matters. The House will remember the various examples that were given in Committee.
        In Committee, some hon. Members expressed concern that the director would come to associate himself too closely with the objectives of a licensee, and not take sufficient account of the interests of others, such as the customers of the licensee in question. I do not regard that as at all likely, as the director whom my right hon. Friend will appoint will be a person of integrity accustomed to taking decisions after weighing up all the relevant interests. I should also point out that, in amending a licence, the director will have to pay regard to the duties in clause 3, which restrict what he may do.
        Nevertheless, I accept that it is not unreasonable to seek extra protection. I therefore propose to amend the Bill so as to permit the Secretary of State to direct the director not to amend a licence under clause 10 if the Secretary of State considers that the amendment should only be made after the issue has been considered by the MMC. I emphasise that this change does not permit the Secretary of State to block a licence amendment. It simply brings in the MMC. That is quite consistent with our approach throughout the Bill of providing stability in policy towards telecommunications and removing the possibility of interference for reasons of short-term political expediency.
        Amendment agreed to.

      Clause 11

        LICENCE MODIFICATION REFERENCES TO COMMISSION
        Amendments made: No. 12, in page 15, line 13, leave out from 'Commission' to 'shall' in line 15.
        No. 13, in page 15, line 16, leave out 'mentioned in paragraphs (a) to (c) of section 3(1)' and insert
        'as respects which duties are imposed on the Secretary of State and the Director by section (General duties of Secretary of State and Director)'.—[Mr. Kenneth Baker.]

      Clause 12

        REPORTS ON LICENCE MODIFICATION REFERENCES
        Mr. Butcher: I beg to move amendment No. 122, in page 16, line 42, after 'interest', insert
        'or the commercial interests of any person'.
        Mr. Deputy Speaker: With this it will be convenient to take Government amendment No. 123.
        Mr. Butcher: Parts of the licences issued by British Telecom under the powers of the 1981 Act and earlier legislation are commercially confidential. At present the Bill does not permit the Secretary of State to exclude from the register of licences which he is obliged to establish under clause 14 commercially confidential matters in

        219
        licences which he issues or which are passed to him under the transitional arrangements in paragraph 1 of schedule 5 to the Bill. Nor does the Secretary of State have power to direct the Director General to exclude such matters when the Director General publishes reports made to him under clause 12 by the Monopolies and Mergers Commission on licence amendment references. In these cases, the Secretary of State can act to exclude matters only on the grounds that publication would be against the public interest. That is by no means synonymous with the commercial interests of companies, so I propose that the Bill should be amended in clause 12 and clause 14 to permit the Secretary of State to direct the Director General to exclude matters on these additional grounds.

      Clause 14
        REGISTER OF LICENCES
        Amendment made: No. 123, in page 18, line 14, at end insert 'or the commercial interests of any person'.—[Mr. Butcher.]
      Clause 15

        SECURING COMPLIANCE WITH LICENCE CONDITIONS
        Mr. Kenneth Baker: I beg to move amendment No. 14, in page 18, line 39, leave out from 'shall' to 'notice' in line 41 and insert 'give'.
        Mr. Deputy Speaker: With this it will be convenient to take Government amendments Nos. 15 to 19.
        Mr. Baker: Clause 15 empowers the Director General to make an order to require a licensee to conform with the conditions of his licence. The director must first send a note of his intentions to the licensee and take account of his views.
        The director can enforce the order himself, but in addition subsection (6) of the clause brings into play a provision in the Fair Trading Act which permits an aggrieved person to take action in the courts to enforce the order made by the director. Since the director is not obliged to publish his intention to issue an order, or the order itself, it would be difficult for a person to take court action.
        I therefore propose to amend the Bill so as to require the director to publish his intention to issue an order and to state its terms, as well as sending a copy to the licensee. If an order is made, it too must be published. This will make feasible court action by a third party to enforce the order. It will have the additional advantage of making the actions of the director and breaches of a condition of a licence by a licensee more transparent.
        I commend the proposal to the House.
        Amendment agreed to.
        Amendments made: No. 15, in page 18, line 42, leave out from 'order' to end of line 42 and insert
        'and setting out its effect'.
        No. 16, in page 19, line 5, leave out 'the service' and insert 'publication'.
        No. 17, in page 19, line 6, leave out 'draft' and insert 'proposed'.
        No. 18, page 19, line 9, at end insert—
        '(2A) A notice under subsection (2) above shall be given by publication in such manner as the Director considers appropriate
        220
        and by sending a copy of the notice to the person against whom the order is proposed to be made (in this section and section 16 below referred to as "the operator"):
        No. 19, in page 19, line 24, after 'shall', insert
        'publish the order in such manner as he considers appropriate and'.—[Mr. Kenneth Baker.]

      Clause 17

        APPROVAL OF CONTRACTORS
        Mr. Butcher: I beg to move amendment No. 20, in page 20, line 14, at end insert—
        '(1A) A person applying for an approval under this section may be required by the person to whom the application is made to comply with such requirements as the person to whom the application is made may think appropriate; and those requirements may include a requirement to satisfy some other person with respect to any matter.'.
        Mr. Deputy Speaker: With this it will be convenient to take Government amendments Nos. 21, 119 and 22 to 29.
        Mr. Butcher: If a licence granted under clause 7 refers to the carrying out of maintenance, installation, repair and so forth by approved persons, the Secretary of State and the director have power under clause 17 to approve people to carry out those operations. As my hon. Friend the Minister for Industry and Information Technology told the House on 7 February, we intend to open up the maintenance of all new call-routing apparatus to competition, whether the call-routing apparatus is large or small, analogue or digital, provided the maintenance is carried out by an approved person. There will be appropriate conditions in the licences of public telecommunication systems. Maintainers will he given approval only if they can demonstrate the necessary degree of competence, quality control, backup for spares and technical information so that the risk of interference to service from poorly maintained apparatus is minimal. The necessary technical assessment will be carried out by the British Standards Institution and I am glad to tell the House that a suitable assessment scheme has now been prepared by BSI, which is already dealing with the first inquiries. There will be periodic inspections of maintainers by BSI to make sure that the quality of service does not deteriorate.
        The Secretary of State or the director will not normally approve a maintainer under clause 17 unless the maintainer has first been registered by BSI. The Secretary of State or the director may occasionally decide against giving approval—for example, if there were considerations of national security.
        Amendments Nos. 20 and 119 merely transfer the present subsection (4) nearer to the beginning of clause 1.7, where it fits more logically. Amendment No. 21 makes it absolutely clear that the continuing periodic inspection of maintainers, which I have already mentioned, is permitted by statute. Amendment No. 22 is consequential to amendment No. 20.
        Amendment No. 23 makes good an omission from subsection (7). It ensures that the Secretary of State is obliged to send the director copies of approvals and particulars of variations or withdrawals only in the case of approvals that the Secretary of State himself has given.
        6.15 pm
        Amendment No. 24 removes a slight restriction in subsection (8) which provides for the payment of fees by

        221
        persons applying for approval under the clause. The amendment makes it possible for someone other than the applicant, such as his agent, to pay the fee and thus avoids a possible obstacle to sensible commercial arrangements between, for example, a manufacturer and a distributor.
        Amendments Nos. 25 to 29 relate to clause 19. They are technical amendments designed to remove any doubt about the statutory authority for the apparatus approval arrangements. As the House knows, these arrangements centre on the British Approvals Board for Telecommunications, an independent private sector body. BABT is a compact, expert organisation which does not possess test facilities of its own but places test work contracts with suitable laboratories and is able to obtain keenly competitive prices. This will help to keep approval fees as low as possible, having regard both to the complexity of the apparatus under test and the nature of the tests laid down in the standards.
        An essential ingredient of the type of approval procedure for apparatus supplied in bulk is the monitoring of quality control in the factory. Without this, there would be no adequate assurance that apparatus coming off the production line was the same as the test samples examined on behalf of BABT.
        Amendment No. 25 makes it clear that an approval authority can insist that appropriate requirements are met. Thus, BABT will be able to insist on quality control procedures in factories. The amendment also requires BABT to require a satisfactory test report from a laboratory that it does not itself run.
        The first part of amendment No. 27 provides for monitoring of products and quality control to be carried out by BABT so long as an approval for a bulk produced item remains in force. The second part removes any doubt that a person other than the Secretary of State or the director may charge fees for laboratory tests, factory assessments and the like required by an approvals authority.
        Amendments No. 26 and 28 make drafting improvements to clause 19(3) and allow apparatus to be approved subject to conditions. Sometimes the conditions will refer to the use of the apparatus. The Bill as drafted limits the effect of approvals to the connection of the apparatus. The amendments widen the drafting to cover conditions of use as well.
        Amendment No. 29 resembles amendment No. 24. It gives flexibility for approval fees to be paid by someone other than the person applying for approval.
        Amendment agreed to.
        Amendments made: No. 21, in page 20, line 23, at end insert
        `and any such condition may impose on the person to whom the approval is given a requirement from time to time to satisfy any person with respect to any matter.'.
        No. 119, in page 20, leave out lines 24 to 29.
        No. 22, in page 20, line 33, leave out '(4)' and insert `(1A) or (3)'.
        No. 23, in page 20, line 40, after 'given', insert `by him'.
        No. 24, in page 21, line 2, leave out `by persons applying for' and insert 'in respect of'.—[Mr. Butcher.]

      Clause 19

        APPROVAL ETC. OF APPARATUS
        Amendments made: No. 25, in page 21, line 35, at end insert—
        '(1A) A person applying for an approval under this section may be required by the person to whom the application is made to comply with such requirements as the person to whom the application is made may think appropriate; and those requirements may include a requirement to satisfy some other person with respect to any matter.'.
        No. 26, in page 21, line 38, leave out from 'apply' to `any' in line 39 and insert
        `either for the purposes of a particular telecommunications system or for the purposes of'.
        No. 27, in page 22, line 3, at end insert
        'and any such condition may impose on the person to whom the approval is given a requirement from time to time to satisfy any person with respect to any matter.
        (3A) Nothing in this section shall preclude a person (not being the Secretary of State or the Director) who is charged with determining any matter for the purposes of any requirement imposed in pursuance of subsection (1A) or (3) above from requiring any payment to be made in respect of the carrying out of any test or other assessment made by him.'.
        No. 28, in page 22, line 20, leave out 'connection to'.
        No. 29, in page 23, line 16, leave out `by persons applying for' and insert 'in respect of'.
        No. 30, in page 23, line 21, leave out 'specification or'.—[Mr. Butcher.]

      Clause 20
        DELEGATION OF FUNCTIONS UNDER SECTION 19
        Amendment made: No. 31, in page 23, line 26, leave out clause 20.—[Mr. Butcher.]
      Clause 27

        RATING IN NORTHERN IRELAND
        Mr. Butcher: I beg to move amendment No. 32 in page 27, line 26, leave out 'Secretary of State' and insert
        'Department of Finance and Personnel for Northern Ireland (in this section referred to as "the Department")'.
        Mr. Deputy Speaker: With this it will be convenient to take Government amendments Nos. 33 to 38.
        Mr. Butcher: The amendments are largely technical. They simply correct an anomaly in the clause as drafted. Clause 27 concerns rating in Northern Ireland and provides that any order should be made by the Secretary of State. We have since been advised that rating is a transferred matter for the purposes of the Northern Ireland Constitution Act 1973. Therefore, it is more appropriate that the local Department rather than the Secretary of State should make the orders. The amendments simply replace references to the Secretary of State by references to the Department throughout the clause.
        Amendment agreed to.
        Amendments made: No. 33, in page 27, line 32, leave out 'Secretary of State' and insert 'Department'.
        No. 34, in page 27, line 34, leave out 'he' and insert `the Department'.
        No. 35, in page 27, line 41, leave out 'Secretary of State' and insert 'Department'.
        No. 36, in page 28, line 1, leave out 'Secretary of State' and insert 'Department'.
        No. 37, in page 28, line 24, leave out 'Secretary of State' and insert 'Department'.
        No. 38, in page 28, line 26, leave out from 'to' to the end of line 31 and insert
        'negative resolution within the meaning of section 41(6) of the Interpretation Act (Northern Ireland) 1954'.—[Mr. Butcher.]

      Clause 39

        INTERRUPTION OR INTERFERENCE WITH PUBLIC TELECOMMUNICATION SYSTEM
        Mr. Charles R. Morris: I beg to move amendment No. 39, in page 35, line 11, at end insert
        `or in the course of, or in connection with a trade dispute with a telecommunications operator'.
        Mr. Deputy Speaker: With this, we shall discuss amendment No. 40, in page 35, line 24, at end insert—
        '(3) No person being an employee of a company running a telecommunication system shall be guilty of an offence—

        (a) under section 45 of the Telegraph Act 1863, insofar as that section makes it an offence for any person employed by the Post Office wilfully to omit or delay to transmit or deliver any message or by any wilful act or omission to prevent or delay the transmission or delivery of any message; or

        (b) under section 20 of the Telegraph Act 1868, as amended, insofar as that section makes it an offence for any person having official duties connected with the Post Office, or acting on behalf of the Postmaster General, contrary to his duty, to intercept the contents or any part of the contents of any telegraphic messages or any message entrusted to the Postmaster General for the purpose of transmission.

        If the conduct in question takes place exclusively or primarily in contemplation of furtherance of a trade dispute with those running telecommunications systems.
        (4) No person shall be guilty of soliciting, inciting or procuring or attempting to solicit, incite or procure or aiding or abetting the commission by any employee of companies running telecommunications systems of an offence under this section, section 45 of the Telegraph Act 1863 or section 20 of the Telegraph Act 1868, unless it be established that one or more of the persons so solicited, incited or procured, or aided or abetted or in relation to them an attempt to solicit, incite or procure as aforesaid is alleged to have been made would not have been entitled to the immunity conferred by subsections (1) and (3) above in relation to trades disputes in the event of his or their being charged with the relevant substantive offence under any of the said provisions.
        (5) Where in pursuance of any agreement the acts in question in relation to any of the offences referred to in subsection (1) and (3) above are to be done exclusively or primarily in contemplation or furtherance of a trade dispute with companies running telecommunications systems that offence or those offences are to be disregarded for the purpose of section 1(1) of the Criminal Law Act 1977.'.
        Mr. Morris: I would be failing in my duty if I sought to minimise the crucial importance of these two amendments, concerned as they are with the right to strike by the staff of British Telecommunications. Given the enactment of the Bill, British Telecommunications at present is poised to enter the private sector with 235,000 employees who will be exposed to legal challenge if they resort to industrial action. That is the main issue posed in these two amendments. Unless the House is careful, it may be writing a recipe for industrial conflict if the Government refuse to accept the principles enshrined in these two amendments.
        The amendments seek solely and exclusively to remove the legal hazards confronting telecommunication workers who seek to exercise what is generally regarded as a basic right enjoyed by virtually every other group of organized
        224
        workers in Britain today—the rights to strike, withdraw labour, and participate in forms of industrial action that represent less than a complete withdrawal of labour.
        British Telecommunications workers claim — and I believe it—that they are among the most reasonable and responsible trade unionists. Throughout the history of the Post Office, when it was the British telephone system, and during the era of British Telecommunications as a public corporation, BT workers have been proud of their traditions of co-operating with their employers in the interests of the community and in the interests of providing one of the most efficient telecomunications systems in the world. These workers have a right and an entitlement to strike without incurring the risk of legal challenge.
        I am delighted that the Solicitor-General is sitting next to the Minister of State. I trust that that comfortable and close proximity will induce in the Minister of State a slightly different response from that which he exhibited when a similar amendment was discussed in Committee.
        My hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) encapsulated what the Opposition are seeking in these two amendments when he coined the phrase that the Opposition are not seeking a charter for industrial action. The Opposition are seeking to ensure that British Telecommunication workers have the same rights as are enjoyed by other groups of organised workers.
        For the benefit of the House I shall explain the legal background to the amendments that I am moving. Before 1976, telecommunications workers always assumed that they had the right to take industrial action. Indeed, they exercised that right during a one-day strike in 1964 and again during the seven-week strike in 1971. They even took action against France in 1973 by banning operator calls for one week in protest against French nuclear tests in the Pacific. There were no legal repercussions on any of those occasions. I concede that fact at the outset.
        Until the Grunwick dispute no doubts about the legality of telecommunications workers' action in withdrawing their labour were expressed. However, in November 1976, when communications workers boycotted mail to Grunwick, doubt arose about whether Post Office and telecommunications workers could legally withdraw their labour. The issue was not put to the legal test until January 1977 when the National Association for Freedom asked the then Attorney-General to institute a legal injunction against the Union of Communication Workers and the Post Office Engineering Union about plans to boycott telecommunications and post to South Africa.
        The Attorney-General at the time refused to grant the injunction but the National Association for Freedom obtained the support of the Appeal Court, presided over by Lord Denning. The court decided that the unions were violating the Telegraph Act and issued the injunction that had been sought.
        Lord Denning stated that it was clearly an offence to "wilfully" delay or interfere with telephone calls or procure others to do so. The House of Lords decided in July 1977 that the Appeal Court had acted wrongly in granting the injunction but the Law Lords endorsed Lord Denning's view that it was a criminal offence to black telephone calls. The union's victory in the House of Lords only shielded telecommunications workers from being the target of civil injunctions—I want to emphasise that. They remained, and remain today, vulnerable to criminal

        225
        prosecution if they withdrew their labour. It is that simple fact that communication workers, generally, find intolerable. Lord Diplock said, that in his view, that
        "such conduct … would constitute a criminal offence".
        He was referring, of course, to the action of blacking particular telephone calls and blacking certain mail.
        Lord Diplock went on to say that, in his view,
        "such conduct … would constitute a criminal offence punishable upon indictment by imprisonment or a fine is plainly beyond argument."
        At that time, Lord Diplock was saying that the legal case was beyond argument. The relevant clause that produces this legal anomaly is section 45 of the Telegraph Act 1863, which states that it will be an offence:
        "If any Person in the Employment of the Company—wilfully or negligently omits or delays to transmit or deliver any Message; Or by any wilful or negligent Act or Omission prevents or delays the Transmission or Delivery of any Message."
        From that quotation it is quite clear that it is an offence to interfere with telecommunications but it is equally clear that section 45 was directed primarily at what might be termed "criminal" rather than "trade union" disruption. Only by the judicial extension of the law, which took place in 1976–77, were workers challenged on taking industrial action.
        At the conclusion of the first day's hearing by the Court of Appeal of the South African action taken by communications workers in respect of South Africa in 1977, to which I have referred, Lord Denning set out section 45 of the Telegraph Act, 1863 and noted that anyone who solicits or procures the prevention or delay of any telegraphic message is guilty at common law as an aider and abetter.
        Having commented on the specific provisions he concluded his observations on the statutory position by observing:
        "Many statutes are not at all clear but those"—
        he was referring to section 45—
        "are clear beyond doubt."
        That was Lord Denning saying clearly and specifically that according to his interpretation of the law, section 45 of the Telegraph Act 1863 was "clear beyond doubt".
        Lord Justice Lawton regarded the legal position as plain, and Lord Justice Ormrod said:
        "we are dealing in this case with the plainest breach of the criminal law which it is possible to imagine and equally clearly with explicit threatened future breaches."
        As the House will recall, the case later came back for a further hearing before the same court. After a full hearing, which lasted several days, Lord Denning refuted the suggestion that the statutory provisions were outdated and should be regarded differently in a modern industrial context. He said:
        "Those enactments are so clear that I see no reason for anyone to require the position to be tested in the courts. If the trade union, or its officers, asked for the advice of any lawyer, the answer must have been: You cannot do it. It is contrary to the law."
        6.30 pm
        In general terms, those interpretations were again endorsed by the House of Lords judgment in July 1977. As a result, the status of telecommunications workers, like that of Post Office workers, is unique and, I believe, a legal anomaly in comparison with workers in other service industries. Section 4 of the Conspiracy and Protection of Property Act 1875 shows that gas and water workers were
        226
        on the same footing as telecommunications workers in that they were guilty of a criminal offence if they acted wilfully to deprive people of their gas and water supplies.
        Mr. Barry Henderson: Perhaps the right hon. Gentleman could clarify the situation. When he talks of an industrial dispute, is he thinking of a dispute between employees and a telecommunications operator in general, or BT in particular, or is he thinking more widely and of disputes in which the employees take action in furtherance of someone else's industrial dispute?
        Mr. Morris: I am seeking to establish that telecommunications workers should generally enjoy the same right as any other group of organised trade unionists in this country to indulge in industrial action, in keeping with the rules of their trade unions. Telecommunications workers should be treated no differently from any other group of workers in seeking to exercise their right to strike and to take industrial action.
        I wanted to draw a comparison between telecommunications, water and gas workers. I have already pointed out the contents of section 4 of the Conspiracy and Protection of Property Act 1875. Section 31 of the Electricity Supply Act 1919 imposed the same condition on electricity workers. However, all the conditions affecting water, gas and electricity workers were repealed under schedule 9 to the Industrial Relations Act 1971. Therefore, water, gas and electricity supply workers are not treated in this way. For some illogical reason that I have been unable to discover from ministerial responses, telecommunications workers are treated differently.
        The two amendments seek to discover why telecommunications workers should be singled out in this way. What possible justification can there be for imposing different conditions on telecommunications and Post Office workers? The peculiarity of the status of telecommunications workers was acknowledged by official Conservative spokesmen for industry when the Conservative party was in opposition. When the present Minister of State, Department of Industry, then the hon. Member for Kingston upon Thames (Mr. Lamont) spoke for the Conservative Opposition, he said that he supported a restricted right of industrial action against employers for Post Office and telecommunications workers. On 17 February 1978, he said:
        "We recognise that Post Office workers feel that they are in a unique position. They feel that whilst others such as the electricity workers, have the right … the Post Office workers are in an anomalous position, and I should find it difficult to argue that Post Office workers are more like policemen than like power workers."—[Official Report, 17 February 1978; Vol. 944, c. 886.]
        If the hon. Gentleman said that in opposition, how can a refusal to take action when in government be justified? In June 1978, the then Conservative spokesman, the hon. Member for Surrey, North-West (Mr. Grylls) said unequivocally:
        "we believe that it is proper for postal workers to have the right to strike against their employer."—[Official Report; June 1978, Standing Committee C; 21 June 1978, c. 8.]
        Why say something in opposition that one is not prepared to stand by when in government? The Minister must answer that point when he replies.
        Postal and telecommunications workers should have the right to strike against their employers. The question is whether telecommunications workers can legally take industrial action when engaged in a trade dispute with their

        227
        employers. It can, and no doubt will, be argued that Lord Denning's judgment in 1977 suggested that industrial action against the employer by telecommunications workers might not fall foul of the law. Lord Denning was far from categoric in his interpretation. As the House will recall, in 1971 there was a seven-week strike of Post Office workers, who, at the time, included telecommunications workers. Lord Denning said:
        "In 1971 there was a strike in which the postal workers stopped work for several weeks. I would not be prepared to assert that this was a breach of the criminal law. It could be said that, by stopping work, they did not wilfully detain or delay the mail. It was, moreover, a trade dispute for which the union was not liable in the Civil Courts. Howsoever that may be, no action was taken in the Courts at that time to test the legality of the action."
        That is the position that we are in. Telecommunications workers who wish to participate in industrial action remain open to a possible legal challenge. The two amendments seek to remove that possibility.
        During consideration of the British Telecommunications Bill 1981, the Government—and certainly the present Minister of State—appeared to argue that Lord Denning's somewhat tentative view should allay the anxiety of telecommunications workers, and that specifically expressed by the Union of Communication Workers and the POEU. On 30 January 1981, in reply to those anxieties, the present Minister of State wrote to the general secretary of the Union of Communication Workers as follows:
        "There appears to be a clear distinction between delay or misconduct in handling mail or telecommunications on the one hand and a strike involving withdrawal of labour on the other. Whilst some kinds of industrial action short of the complete withdrawal of labour could constitute offences, particularly where the action involved breach of the employee's contractual obligations to his employer, a strike involving the withdrawal of labour should not amount to a criminal offence. Neither the decision of the Court of Appeal nor the House of Lords in the Gouriet case, to which you refer, suggests a contrary view. In fact, Lord Denning's judgment points clearly to the view that the right to strike is unaffected. The law, therefore, seems to be as you wish it to be."
        If that is the considered view of the Minister of State let him make the law crystal clear and remove the threat that exists that telecommunications workers are open to legal challenge if they resort to industrial action. I remind the Minister of State that there is widespread interest among telecommunications workers generally in this legal point and I hope that he will give the considered view of the Government for refusing to take action to remove this legal anomaly.
        Mr. Tom Ellis: I rise mainly to ease the mind of the Minister of State, who gets terribly worried about what the Alliance will do—whether it will support the Government or the official Opposition—and does not seem to appreciate that very frequently sensible people might support neither. I can put him out of his misery tonight by saying that we shall be supporting this amendment. Although there are some technical weaknesses in it, the spirit of the amendment is so overwhelming and obvious that we shall be very happy to support it.
        For all sorts of reasons—which, in order to be brief, I will not go into now—if the Bill were not moving the state away from the industry, making private companies, there would be much more argument for refusing the right to strike since the people would be employed by the state. There are now to be private companies and denying the people employed in them the right to strike seems to be
        228
        completely contrary to all our traditions and to the fundamental principles referred to by the right hon. Member for Manchester, Openshaw (Mr. Morris).
        There is one point on which we feel that in a technical sense the amendment cannot be supported. It applies to subsection (1)(a) and (b). Where it applies to (b)—that is, by providing that people on strike should be allowed intentionally to modify or interfere with the contents of a message—we cannot support it because that would be equivalent to somebody on strike in manufacturing industry being able to go round with a sledghanuner smashing the machinery. That is a technicality, however. We wholeheartedly support the spirit of the amendment and will be trooping into the lobby in our great strength against the Government.
        6.45 pm
        Mr. Stan Thorne: It is not my intention to speak at length so my right hon. Friend the Member for Salford, West (Mr. Orme) need not look quite so worried. I wish to say only a few words because we debated this matter extensively in the Committee and it was quite clear then, as it is now. I do not want to assume what the Minister of State or the Solicitor-General will say on this subject, although I think it is fairly clear what that is likely to be.
        It is interesting that spokesmen for this Government have on many occasions alluded to police states and the deprivation of civil rights in several countries—and this at a time when they are implementing legislation that deprives workers in a particular industry of the elementary right to strike. I do not think it is going too far to equate that with the concept of slavery. If workers in this industry cannot respond to difficulties over their working conditions, their pay or anything else that directly affects them because they would be breaking the law, that, it seems to me, is little different from the concept that we have heard described many times by Government Members of a police state.
        There are certain other indications, but if I dealt with them now, Mr. Deputy Speaker, you would rule me out of order. The indications are plain. The authoritarian government we have seen over the last four years grows in significance through the activities of people such as the Secretary of State for Employment and others. I forecast that if we were unfortunate enough to be faced in a few years with yet another Conservative Government there would be even further erosion of civil liberties.
        I hope that all Opposition Members will find it absolutely imperative to vote in favour of ensuring that in future British telecomunications workers have the elementary right to withdraw their labour in certain circumstances.
        Mr. Golding: My message from the members of the POEU is that the Solicitor-General is saying that one may strike but one must not take other industrial action. If a man is on scheduled overtime—say four hours' overtime—he may strike for 12 hours, but he may not work for eight hours and strike for four hours. He may strike, but he may not work to rule if that is impeding the business in ways which cannot be justified. That is the daftness of the legislation. That is the situation that the Solicitor-General and the Government are tryin,g to defend.
        I want to say a few words about the dispute with Mercury, because the Minister of State has referred to that. The POEU wishes it to be known that

        229
        "Mercury, on its own admission, is not going to provide any new service. It will dilute British Telecom's future profitability by competing on the most lucrative business routes currently available. Mercury is, therefore, an unnecessary duplication and waste of national resources.
        "Although we [the POEU] remain firmly of the view that it will not be for the benefit of the community as a whole, competition is an established fact. We believe that British Telecom will compete and be effective against its rivals.
        "However, we object to the fact that British Telecom is being forced to give up its own telecommunications network for use by these rivals. This is the purpose of our industrial action against connecting Mercury to British Telecom's network.
        "Mercury was created to establish an independent alternative network to British Telecom. Although we do not support this, we acknowledge the fact that it is going to happen. However, we do not intend to see Mercury exploiting the network which British Telecom has created over very many years, and which is based upon the work of our members, in order to do this, especially as this exploitation will reduce British Telecom's business and hence the job opportunities for these members. No respectable business should be forced to hand over the use of its assets in this way, British Telecom included."
        That is the message that the POEU wishes to give the Government and the Solicitor-General. We believe that it is absolutely right to be able to use industrial action to safeguard jobs and conditions of service.
        Mr. Kenneth Baker: I shall have to consider carefully what the hon. Member for Newcastle-under-Lyme (Mr. Golding) has just said about the position that the Post Office Engineering Union has taken over connecting to the British Telecom network. The British Telecom network is not owned by the Post Office Engineering Union; it is a national asset and agreements exist for British Telecom to provide for interconnection. As I said yesterday at the Dispatch Box—and it was reported—we would expect British Telecom to honour those agreements.
        I reiterate that it is extraordinary that the Post Office Engineering Union should have that attitude and at the same time ask that it should be given the exclusive privilege to lay cable television networks in Britain. Can it not see that any prospective partners for which BT is looking, and hence the Post Office Engineering Union, will be looking carefully at the decisions that the POEU will be making over the next few days and weeks? If they are in danger of having the plug pulled upon them as regards interconnect, what assurance can possible consortium partners have in association with BT in cable provision? I hope that it will be taken into account by the POEU.
        As the House knows, this issue was debated two years ago during proceedings on the British Telecommunications Act 1981, and recently in Committee. I should like first to consider the extent of employees' liability under the provisions to see whether the new subsections are necessary. Immunity for employees involved in trade disputes was dealt with when similar provisions were discussed in Committee on the 1981 Act as well as in Committee on this Bill. The statement made by the Attorney-General in Committee in 1981 said that the offences would not apply in cases where there was a withdrawal of labour but left the presumption that a successful prosecution could result where industrial action short of a full withdrawal of labour occurred. I do not think that there is any dispute about that interpretation.
        The Attorney-General's advice in 1981 was that section 45 of the Telegraph Act 1863, and certain provisions in the
        230
        Post Office Act 1953, were all directed at dereliction of duty involving one or more messages or postal packets and that a complete withdrawal of labour could not have those characteristics. It followed that in his opinion it was inconceivable that a prosecution in respect of the offences in question would succeed in the event of a strike that involved a complete withdrawal of labour. I emphasise that point in view of the strong speech of the hon. Member for Preston, South (Mr. Thorne).
        The Attorney-General went on to consider whether industrial action short of a complete withdrawal of labour would be caught by the provisions but he was unable to give firm guidance. His conclusions were, first, that a refusal to undertake voluntary overtime could not lead to proceedings because the essence of voluntary work is that one can chose whether or not to partake in it.
        However, if overtime was part of an agreed rota system defined in any contract of employment, refusal to work the extra hours might well be construed a wilful breach of duty and as such come under the provision of the enactments. The second point was that working to rule would not be a negligent or wilful act if it involved genuinely applying agreed rules and so could not be the subject of a successful prosecution under the provisions. Thirdly, he made the point that discriminatory action against one or more persons—for example, by refusing to provide service to him or them—could justify prosecution under the offences as it could be deemed a wilful refusal to undertake the transmission of a message contrary to duty.
        I stress that the Attorney-General's comments were directed to criminal proceedings arising out of section 45 of the Telegraph Act 1863 and certain provisions of the Post Office Act 1953. But it can readily be seen that Post Office employees can do a great deal in connection with a trade dispute without incurring criminal liability.
        The offences in clause 39 are updated versions of the offences in section 45 of the Telegraph Act 1863, as the right hon. Member for Salford, West (Mr. Orme) reminded us in his opening speech. There seems no reason why the opinion of the Attorney-General on the operation of those offences in relation to industrial action should not equally apply to the offences under clause 39.
        Let us consider what the Solicitor-General said to members of the Standing Committee on the same issue in respect of clause 39. He emphasised three points about the offence. He said, first, that because it creates a criminal offence it will always be interpreted in favour of the liberty of the subject; secondly, that intention is the essential ingredient; and, thirdly, that the offence is one that is committed by individuals so that the individual charged has to have done the act of preventing or delaying transmission with the intention of preventing and delaying before he can be convicted.
        The Solicitor-General confirmed that no offence under clause 39 of preventing, delaying or interrupting the transmission or reception of a message would be committed if the interruption was the result of a complete withdrawal of labour. However, the Solicitor-General said that there was a risk that action short of a strike that was discriminatory or selective, especially perhaps if secondary, would amount to a criminal offence under clause 39. As examples of discriminatory or selective action, the Solicitor-General instanced the intentional blacking of a certain message or messages or a class or

        231
        classes of message. The Solicitor-General found it hard to see how refusing to do overtime would constitute an offence if there was no obligation under contract to do any.
        On working to rule, the Solicitor-General noted that whether an offence would be committed depended on whether the work to rule was genuine. If an employee said that he would do everything that he was under contract to do and no more, that would be an end of the matter. But if working to rule was a means of bringing work to a halt the position might be different.
        The Bill is not intended as a vehicle to amend industrial relations or employment law and for that reason clause 39 does little more than update the wording of the offences in section 45 of the Telegraph Act 1863. I stress that the Bill does not take away the right of an employee of a public telecommunications operator to strike—not just BT but all public telecommunications operators. The effect of clause 39 is simply to extend to all public telecommunications operators certain safeguards against the interruption and delay of telecommunications, for which safeguards have existed since 1863. Those safeguards have not resulted in any prosecution arising out of industrial action, nor, so far as I know, have they inhibited the withdrawal of labour. I must oppose the amendments and I hope that they will be rejected by the House.
        Question put, that the amendment be made:—
        The House divided: Ayes 231, Noes 288.

        Division No. 106]

        [6.57 pm

        AYES

        Abse, Leo

        Cunliffe, Lawrence

        Allaun, Frank

        Cunningham, Dr J. (W'h'n)

        Alton, David

        Dalyell, Tarn

        Anderson, Donald

        Davidson, Arthur

        Archer, Rt Hon Peter

        Davies, Rt Hon Denzil (L'lli)

        Ashley, Rt Hon Jack

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

        Ashton, Joe

        Deakins, Eric

        Atkinson, N.(H'gey)

        Dean, Joseph (Leeds West)

        Bagier, Gordon A.T.

        Dewar, Donald

        Barnett, Guy (Greenwich)

        Dixon, Donald

        Barnett, Rt Hon Joel (H'wd)

        Dobson, Frank

        Beith, A. J.

        Dormand, Jack

        Benn, Rt Hon Tony

        Douglas, Dick

        Bennett, Andrew (St'Kp't N)

        Dubs, Alfred

        Bidwell, Sydney

        Duffy, A. E. P.

        Booth, Rt Hon Albert

        Dunnett, Jack

        Boothroyd, Miss Betty

        Dunwoody, Hon Mrs G.

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

        Eadie, Alex

        Bradley, Tom

        Eastham, Ken

        Bray, Dr Jeremy

        Ellis, R. (NE D'byshre)

        Brocklebank-Fowler, C.

        Ellis, Tom (Wrexham)

        Brown, Hugh D. (Provan)

        English, Michael

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

        Evans, loan (Aberdare)

        Brown, Ronald W. (H'ckn'y S)

        Evans, John (Newton)

        Brown, Ron (E'burgh, Leith)

        FauIds, Andrew

        Buchan, Norman

        Field, Frank

        Callaghan, Rt Hon J.

        Ford, Ben

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

        Forrester, John

        Campbell, Ian

        Foster, Derek

        Campbell-Savours, Dale

        Foulkes, George

        Canavan, Dennis

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

        Cant, R. B.

        Freeson, Rt Hon Reginald

        Carter-Jones, Lewis

        Garrett, John (Norwich S)

        Cartwright, John

        Garrett, W. E. (Wallsend)

        Clark, Dr David (S Shields)

        George, Bruce

        Clarke.Thomas (C'b'dge, A'rie)

        Gilbert, Rt Hon Dr John

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

        Ginsburg, David

        Coleman, Donald

        Golding, John

        Conlan, Bernard

        Gourlay, Harry

        Cook, Robin F,

        Graham, Ted

        Cowans, Harry

        Grant, John (Islington C)

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

        Grimond, Rt Hon J.

        Crawshaw, Richard

        Hamilton, James (Bothwell)

        Crowther, Stan

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

        Cryer, Bob

        Hardy, Peter

        232

        Harrison, Rt Hon Walter

        Penhaligon, David

        Hart, Rt Hon Dame Judith

        Pitt, William Henry

        Hattersley, Rt Hon Roy

        Powell, Raymond (Ogmore)

        Haynes, Frank

        Prescott, John

        Healey, Rt Hon Denis

        Price, C. (Lewisham W)

        Heffer, Eric S.

        Race, Reg

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

        Rees, Rt Hon M (Leeds S)

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

        Roberts, Albert (Normanton)

        Home Robertson, John

        Roberts, Ernest (Hackney N)

        Homewood, William

        Roberts, Gwilym (Cannock)

        Hooley, Frank

        Rodgers, Rt Hon William

        Horam, John

        Rooker, J. W.

        Howells, Geraint

        Roper, John

        Hoyle, Douglas

        Ross, Ernest (Dundee West)

        Huckfield, Les

        Ross, Stephen (Isle of Wight)

        Hughes, Mark (Durham)

        Rowlands, Ted

        Hughes, Robert (Aberdeen N)

        Ryman, John

        Hughes, Roy (Newport)

        Sandelson, Neville

        Hughes, Simon (Bermondsey)

        Sever, John

        Jay, Rt Hon Douglas

        Sheerman, Barry

        John, Brynmor

        Shore, Rt Hon Peter

        Johnson, James (Hull West)

        Silkin, Rt Hon J. (Deptford)

        Johnson, Walter (Derby S)

        Silkin, Rt Hon S. C (Dulwich)

        Jones, Barry (East Flint)

        Silverman, Julius

        Kaufman, Rt Hon Gerald

        Skinner, Dennis

        Kilfedder, James A.

        Smith, Cyril (Rochdale)

        Kilroy-Silk, Robert

        Smith, Rt Hon J. (N Lanark)

        Lamond, James

        Snape, Peter

        Leadbitter, Ted

        Soley, Clive

        Leighton, Ronald

        Spearing, Nigel

        Lestor, Miss Joan

        Spriggs, Leslie

        Litherland, Robert

        Stallard, A. W.

        Lofthouse, Geoffrey

        Steel, Rt Hon David

        Lyon, Alexander (York)

        Stoddart, David

        Lyons, Edward (Bradf'd W)

        Stott, Roger

        Mabon, Rt Hon Dr J. Dickson

        Strang, Gavin

        McCartney, Hugh

        Straw, Jack

        McElhone, Mrs Helen

        Summerskill, Hon Dr Shirley

        McGuire, Michael (Ince)

        Taylor, Mrs Ann (Bolton W)

        McKelvey, William

        Thomas, Dafydd (Merioneth)

        MacKenzie, Rt Hon Gregor

        Thomas, Jeffrey (Abertillery)

        McNamara, Kevin

        Thomas, Dr H.(Carmarthen)

        McTaggart, Robert

        Thome, Stan (Preston South)

        McWilliam, John

        Tinn, James

        Magee, Bryan

        Torney, Tom

        Marks, Kenneth

        Varley, Rt Hon Eric G.

        Marshall, D (G'gow S'ton)

        Wainwright, B.(Dearne V)

        Marshall, Dr Edmund (Goolo)

        Wainwright, H. (Colne V)

        Marshall, Jim (Leicester S)

        Wardell, Gareth

        Martin, M (G'gow S'burn)

        Weetch, Ken

        Mason, Rt Hon Roy

        Wellbeloved, James

        Maynard, Miss Joan

        Welsh, Michael

        Meacher, Michael

        White, Frank R.

        Mikardo, Ian

        White, J. (G'gow Pollok)

        Millan, Rt Hon Bruce

        Whitehead, Phillip

        Mitchell, Austin (Grimsby)

        Whitlock, William

        Mitchell, R. C. (Soton Itchen)

        Wigley, Dafydd

        Morris, Rt Hon A. (W'shawe)

        Willey, Rt Hon Frederick

        Morris, Rt Hon C. (O'shaw)

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

        Morris, Rt Hon J. (Aberavon)

        Williams, Rt Hon Mrs(Crosby)

        Mulley, Rt Hon Frederick

        Wilson, Gordon (Dundee E)

        Newens, Stanley

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

        Oakes, Rt Hon Gordon

        Wilson, William (C'try SE)

        O'Brien, Oswald (Darlington)

        Winnick, David

        O'Halloran, Michael

        Woodall, Alec

        O'Neill, Martin

        Woolmer, Kenneth

        Orme, Rt Hon Stanley

        Wrigglesworth, Ian

        Palmer, Arthur

        Young, David (Bolton E)

        Park, George

        Parker, John

        Tellers for the Ayes:

        Parry, Robert

        Mr. George Morton and

        Pavitt, Laurie

        Mr. Allen McKay.

        Pendry, Tom

        NOES

        Aitken, Jonathan

        Arnold, Tom

        Alexander, Richard

        Aspinwall, Jack

        Alison, Rt Hon Michael

        Atkins, Rt Hon H.(S'thorne)

        Amery, Rt Hon Julian

        Atkinson, David (B'm'th.E)

        Ancram, Michael

        Baker, Kenneth (St.M'bone)

        233

        Baker, Nicholas (N Dorset)

        Gilmour, Rt Hon Sir Ian

        Banks, Robert

        Glyn, Dr Alan

        Beaumont-Dark, Anthony

        Goodhart, Sir Philip

        Bendall, Vivian

        Goodhew, Sir Victor

        Benyon, Thomas (A'don)

        Goodlad, Alastair

        Benyon, W. (Buckingham)

        Gorst, John

        Berry, Hon Anthony

        Gow, Ian

        Best, Keith

        Gower, Sir Raymond

        Bevan, David Gilroy

        Grant, Sir Anthony

        Biffen, Rt Hon John

        Gray, Rt Hon Hamish

        Biggs-Davison, Sir John

        Greenway, Harry

        Blackburn, John

        Grieve, Percy

        Blaker, Peter

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

        Body, Richard

        Griffiths, Peter (Portsm'th N)

        Bonsor, Sir Nicholas

        Grist, Ian

        Boscawen, Hon Robert

        Grylls, Michael

        Bottomley, Peter (W'wich W)

        Gummer, John Selwyn

        Bowden, Andrew

        Hamilton, Hon A.

        Boyson, Dr Rhodes

        Hamilton, Michael (Salisbury)

        Braine, Sir Bernard

        Hampson, Dr Keith

        Bright, Graham

        Hannam, John

        Brinton, Tim

        Haselhurst, Alan

        Brittan, Rt. Hon. Leon

        Havers, Rt Hon Sir Michael

        Brooke, Hon Peter

        Hawkins, Sir Paul

        Brotherton, Michael

        Hawksley, Warren

        Brown, Michael(Brigg & Sc'n)

        Hayhoe, Barney

        Browne, John (Winchester)

        Henderson, Barry

        Bruce-Gardyne, John

        Heseltine, Rt Hon Michael

        Bryan, Sir Paul

        Hicks, Robert

        Buchanan-Smith, Rt. Hon. A.

        Higgins, Rt Hon Terence L.

        Buck, Antony

        Hill, James

        Budgen, Nick

        Hogg, Hon Douglas (Gr'th'm)

        Burden, Sir Frederick

        Holland, Philip (Carlton)

        Butcher, John

        Hooson, Tom

        Carlisle, John (Luton West)

        Hordern, Peter

        Carlisle, Kenneth (Lincoln)

        Howe, Rt Hon Sir Geoffrey

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

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

        Chalker, Mrs. Lynda

        Howell, Ralph (N Norfolk)

        Channon, Rt. Hon. Paul

        Hunt, David (Wirral)

        Chapman, Sydney

        Hunt, John (Ravensbourne)

        Churchill, W. S.

        Irvine, RtHon Bryant Godman

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

        Irving, Charles (Cheltenham)

        Clark, Sir W. (Croydon S)

        Jenkin, Rt Hon Patrick

        Clarke, Kenneth (Rushcliffe)

        Jessel, Toby

        Clegg, Sir Walter

        Jopling, Rt Hon Michael

        Cockeram, Eric

        Joseph, Rt Hon Sir Keith

        Colvin, Michael

        Kaberry, Sir Donald

        Cormack, Patrick

        Kellett-Bowman, Mrs Elaine

        Corrie, John

        Kershaw, Sir Anthony

        Costain, Sir Albert

        Kimball, Sir Marcus

        Crouch, David

        King, Rt Hon Tom

        Dickens, Geoffrey

        Kitson, Sir Timothy

        Dorrell, Stephen

        Knight, Mrs Jill

        Douglas-Hamilton, Lord J.

        Knox, David

        Dover, Denshore

        Lang, Ian

        du Cann, Rt Hon Edward

        Langford-Holt, Sir John

        Dunn, Robert (Dartford)

        Latham, Michael

        Durant, Tony

        Lawson, Rt Hon Nigel

        Dykes, Hugh

        Lee, John

        Edwards, Rt Hon N. (P'broke)

        Le Merchant, Spencer

        Eggar, Tim

        Lennox-Boyd, Hon Mark

        Emery, Sir Peter

        Lester, Jim (Beeston)

        Eyre, Reginald

        Lloyd, Ian (Havant & W'loo)

        Fairbairn, Nicholas

        Lloyd, Peter (Fareham)

        Fairgrieve, Sir Russell

        Loveridge, John

        Faith, Mrs Sheila

        Luce, Richard

        Farr, John

        Lyell, Nicholas

        Fell, Sir Anthony

        Macfarlane, Neil

        Fenner, Mrs Peggy

        MacGregor, John

        Finsberg, Geoffrey

        MacKay, John (Argyll)

        Fisher, Sir Nigel

        Macmillan, Rt Hon M.

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

        McNair-Wilson, M. (N'bury)

        Fletcher-Cooke, Sir Charles

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

        Forman, Nigel

        McQuarrie, Albert

        Fraser, Rt Hon Sir Hugh

        Madel, David

        Fraser, Peter (South Angus)

        Major, John

        Fry, Peter

        Marland, Paul

        Gardiner, George (Reigate)

        Marlow, Antony

        Gardner, Sir Edward

        Marshall, Michael (Arundel)

        Garel-Jones, Tristan

        Marten, Rt Hon Neil

        234

        Mates, Michael

        Shaw, Giles (Pudsey)

        Maude, Rt Hon Sir Angus

        Shaw, Sir Michael (Scarb')

        Mawby, Ray

        Shelton, William (Streatham)

        Mawhinney, Dr Brian

        Shepherd, Colin (Hereford)

        Maxwell-Hyslop, Robin

        Shepherd, Richard

        Mayhew, Patrick

        Silvester, Fred

        Mellor, David

        Sims, Roger

        Meyer, Sir Anthony

        Skeet, T. H. H.

        Miller, Hal (B'grove)

        Smith, Tim (Beaconsfield)

        Mills, Iain (Meriden)

        Speed, Keith

        Mills, Sir Peter (West Devon)

        Speller, Tony

        Miscampbell, Norman

        Spence, John

        Mitchell, David (Basingstoke)

        Spicer, Jim (West Dorset)

        Moate, Roger

        Spicer, Michael (S Worcs)

        Monro, Sir Hector

        Sproat, Iain

        Montgomery, Fergus

        Squire, Robin

        Moore, John

        Stainton, Keith

        Morris, M. (N'hampton S)

        Stanbrook, Ivor

        Morrison, Hon C. (Devizes)

        Stanley, John

        Morrison, Hon P. (Chester)

        Steen, Anthony

        Mudd, David

        Stevens, Martin

        Murphy, Christopher

        Stewart, A (E Renfrewshire)

        Myles, David

        Stewart, Ian (Hitchin)

        Neale, Gerrard

        Stokes, John

        Needham, Richard

        Stradling Thomas, J.

        Nelson, Anthony

        Tapsell, Peter

        Neubert, Michael

        Taylor, Teddy (S'end E)

        Newton, Tony

        Tebbit, Rt Hon Norman

        Normanton, Tom

        Temple-Morris, Peter

        Onslow, Cranley

        Thomas, Rt Hon Peter

        Oppenheim, Rt Hon Mrs S.

        Thompson, Donald

        Osborn, John

        Thorne, Neil (Word South)

        Page, John (Harrow, West)

        Thornton, Malcolm

        Page, Richard (SW Herts)

        Townend, John (Bridlington)

        Parkinson, Rt Hon Cecil

        Townsend, Cyril D, (B'heath)

        Patten, Christopher (Bath)

        van Straubenzee, Sir W.

        Pattie, Geoffrey

        Vaughan, Dr Gerard

        Pawsey, James

        Viggers, Peter

        Percival, Sir Ian

        Waddington, David

        Peyton, Rt Hon John

        Waldegrave, Hon William

        Pink, R. Bonner

        Walker, Rt Hon P.(W'cester)

        Pollock, Alexander

        Walker, B. (Perth)

        Porter, Barry

        Walker-Smith, Rt Hon Sir D.

        Prentice, Rt Hon Reg

        Wall, Sir Patrick

        Price, Sir David (Eastleigh)

        Waller, Gary

        Proctor, K. Harvey

        Walters, Dennis

        Pym, Rt Hon Francis

        Ward, John

        Raison, Rt Hon Timothy

        Watson, John

        Rathbone, Tim

        Wells, Bowen

        Renton, Tim

        Wells, John (Maidstone)

        Rhodes James, Robert

        Wheeler, John

        Rhys Williams, Sir Brandon

        Whitney, Raymond

        Ridley, Hon Nicholas

        Wickenden, Keith

        Ridsdale, Sir Julian

        Williams, D.(Montgomery)

        Rippon, Rt Hon Geoffrey

        Wolfson, Mark

        Roberts, Wyn (Conway)

        Young, Sir George (Acton)

        Rossi, Hugh

        Younger, Rt Hon George

        Rost, Peter

        Royle, Sir Anthony

        Tellers for the Noes:

        Sainsbury, Hon Timothy

        Mr. Carol Mather and

        St. John-Stevas, Rt Hon N.

        Mr. John Cope.

        Question accordingly negatived.
        It being after Seven o'clock, MR. DEPUTY SPEAKER proceeded, pursuant to the Order [16 FEBRUARY] and the Resolution this day, to put forthwith the Questions necessary for the disposal of the business to be concluded at Seven o'clock.

      Clause 44
        INTERPRETATION OF PART II
        Amendment made: No. 41, in page 37, leave out lines 41 to 43.—[Mr. David Hunt.]
      Clause 45
        GENERAL FUNCTIONS
        Amendment made: No. 42, in page 38, line 15, leave out 'commercial'.—[Mr. David Hunt.]
      Clause 46
        PUBLICATION OF INFORMATION AND ADVICE
        Amendment made: No. 43, in page 38, line 30, leave out from beginning to 'the' in line 31.—[Mr. David Hunt.]
      Clause 47

        INVESTIGATION OF COMPLAINTS
        Amendments made:
        No. 44, in page 39, line 26, at end insert 'and'.
        No. 113, in page 39, line 29, after 'by' insert
        'a body recognised by the Secretary of State under section (Recognition of bodies representing consumers etc.) above or by'.
        No. 45, in page 39, line 30, at end insert—
        '(1A) Subsection (1) above does not apply to any matter which relates to—

        (a)the transmission by a broadcasting authority, by wireless telegraphy, of sounds, visual images or such signals as are mentioned in paragraph (c) of section 4(1) above from a transmitting station for general reception direct from that station; or

        (b)the reception of sounds, visual images or such signals transmitted, by wireless telegraphy, from a transmitting station for general reception direct from that station.'

        No. 46, in page 39, line 34, at end insert—
        '2(A) In this section "broadcasting authority" means a person licensed under the Wireless Telegraphy Act 1949 to broadcast programmes for general reception and "wireless telegraphy" has the same meaning as in that Act.'.—[Mr. David Hunt.]

      Clause 48

        POWER TO ESTABLISH ADVISORY BODIES, ETC.
        Amendments made: No. 114, in page 40, line 6, at end insert—
        '(3A) Each of the advisory bodies established under subsection (2) above shall, as soon as practicable after the end of the year 1984 and of each subsequent calendar year, make to the Director a report on its activities during that year.'
        No. 115, in page 40, leave out lines 10 to 19.—[Mr. David Hunt.]

      Clause 51

        POWERS TO REQUIRE INFORMATION ETC.
        Amendment made: No. 47, in page 42, line 18, after 'functions', insert
        '(other than his functions under sections 45(1) and 46(1) above)'.—[Mr. David Hunt.]

      Clause 52

        ANNUAL AND OTHER REPORTS
        Amendments made: No. 116, in page 43, line 31, after 'include', insert ' (a)'.
        Page 43, line 33 at end insert
        'and
        (b) the reports which the advisory bodies established under section 48(2) above make to him on their activities during that year.'.—[Mr. David Hunt.]

      Clause 56

        CONVERSION OF CERTAIN LOANS TRANSFERRED TO THE SUCCESSOR COMPANY
        Amendments made: No. 52, in
        page 46, line 30 at end insert
        'such debentures of the company as the Secretary of State may direct'
        No. 53, in page 46, line 33 leave out 'in question".
        No. 54, in page 46 leave out lines 35 and 36.
        No 55, in page 47, line 8 leave out from 'loan' to end of line 9 and insert
        'shall be disregarded in so far as they relate to the early discharge of liabilities to make repayments of principal and payments of interest'.
        No. 118, in page 47, line 12, at end insert—
        '(6A) For the avoidance of doubt it is hereby declared that the principal sums payable under debentures issued in pursuance of this section are to be regarded as money lent for the purposes of subsection (10) of section 48 of the Finance Act 1981 (write-off of government investment: restriction of tax losses).'.—[Mr. David Hunt.]

      Clause 60

        FINANCIAL STRUCTURE OF THE SUCCESSOR COMPANY
        Amendments, made: No 58, in page 50, line 3 after 'last', insert 'complete'.
        page 50, line 30 at end insert
        'and the reference in subsection (4) above to the last complete accounting year of British Telecommonications ending before the transfer date is a reference to the accounting year of British Telecommunications ending with the 31st. March immediately preceding that date.'.—[Mr. David Hunt]

      Clause 63

        DISSOLUTION OF BRITISH TELECOMMUNICATIONS AND TRANSITIONAL PROVISIONS.
        Amendments made: No. 60, in page 51, line 33 leave out 'the following provisions of this section' and insert
        'subsection (2) below'.
        No. 61, in page 51, line 38 leave out
        'and schedule 1 to the 1981 Act'
        and insert
        'the 1981 Act and Schedule 1 to that Act (except paragraph 5 thereof)'.
        No. 62, in page 51, line 41 leave out from 'below' to end of line 43.
        No. 63, in page 52 leave out lines 1 to 37.
        No. 64, in page 52, line 43 leave out 'subsection (3) above or'.
        No. 65, in page 53 leave out lines 1 to 9.—[Mr. David Hunt.]

      Clause 65

        TAX PROVISIONS
        Amendment made: No. 121, in page 54, line 14 at end insert—
        '(3A) The vesting in the successor company by virtue of section 54 above of liability for any loan made to British Telecommunications shall not affect any direction in respect of the loan which has been given by the Treasury under section 416 of the Income and Corporation Taxes Act 1970 (income tax exemption for interest on foreign currency securities).'.—[Mr. David Hunt.]

      Clause 66

        POWERS OF MANAGERS OF CERTAIN WELFARE FUNDS TO
        preserve their scope
        Amendment made: No. 66, in page 54, line 27, leave out clause 66.—[Mr. David Hunt.]

      Schedule 2

        THE TELECOMMUNICATIONS CODE
        Amendments made: No. 67, in page 74, line 3 at end insert—
        '(2A) In relation to any land which, otherwise than in connection with a street on that land, is divided horizontally into different parcels, the references in this code to a place over or under the land shall have effect in relation to each parcel as not including references to any place in a different parcel.'.
        No. 68, in page 75, line 14 at end insert—
        '(5A) It is hereby declared that a right falling within subparagraph (1) above is not subject to the provisions of any enactment requiring the registration of interests in, charges on or other obligations affecting land.'.
        No. 69, in page 76 leave out line 3 and insert—
        'person—

        (i) who is infeft proprietor of the land; or

        (ii) who has right to the land but whose title thereto is not complete; or

        (iii) in the case of land subject to a heritable security constituted by exfacie absolute disposition, who is the debtor in the security, except where the creditor is in possession of the land,

        other than a person having a right as a superior only.'.
        No. 70, in page 79 leave out lines 44 to 49 and insert—
        '(4) The rights conferred by this paragraph shall not be exercisable on any land comprised in the route of a special road (within the meaning of the Highways Act 1980, the Special Roads Act 1949 or the Roads (Northern Ireland) Order 1980).'.
        No. 73, in page 85, line 35 at end insert
        `or any other authority which discharges functions of that authority in relation to that sewer and is authorised by the authority in which the sewer is vested to act on its behalf for the purposes of this paragraph.'.
        No. 107, in page 90, line 5 after 'under', insert 'the preceding provisions of'.
        No. 108, in page 90, line 6 leave out from second 'with' to 'order' in line 7 and insert 'an'.
        No. 109, in page 90, line 9, leave out
        'gave the notice or, as the case may be,'.
        No. 110, in page 91, line 45, leave out from 'directs' to 'shall' in line 47 and insert
        `on an application under the preceding provisions of this paragraph, any expenses incurred by the operator in or in connection with the making of any alteration in compliance with an order under this paragraph'.
        No. 111, in page 91, leave out line 49 and insert
        'applied for the order'.
        No. 74, in page 96, line 11, leave out from beginning to 'authorise' in line 12 and insert—
        238
        `25.—(1) Except in so far as provision is otherwise made by virtue of section 87(2) of or Schedule 4 to this Act, this code shall not'.
        No. 75, in page 96, line 32, after 'given', insert
        '(or deemed to have been given)'.
        No. 76, in page 96, line 41, after 'gave', insert
        `(or is deemed to have given)'.—[Mr. David Hunt.]

      Schedule 4

        MINOR AND CONSEQUENTIAL AMENDMENTS
        Amendments made: No. 77, in page 111, line 15, leave out
        'and of paragraph 8(4) of the telecommunications code (applications of enactments, including section 4 of this Act)'.
        No. 78, in page 141, line 22, at end insert—
        'The Land Registration (Scotland) Act 1979
        71A. In section 28(1) of the Land Registration (Scotland) Act 1979 (interpretation etc.), in the definition of "overriding interest", after paragraph (e) there shall be inserted the following paragraph—
        "(ee) the operator having a right conferred in accordance with paragraph 2, 3 or 4 of Schedule 2 to the Telecommunications Act 1983 (agreements for execution of works, obstruction of access, etc.);".'.
        No. 79, in page, 145, line 23, leave out from beginning to 'operation' in line 25.
        No. 80, in page 154, leave out line 14.
        No. 81, in page 154, leave out lines 16 and 17.
        No. 82, in page 154, leave out line 23.
        No. 83, in page 154, leave out line 31.
        No. 84, in page 154, leave out line 40.—[Mr. David Hunt.]

      Schedule 5

        GENERAL TRANSITIONAL PROVISIONS AND SAVINGS
        Amendments made: No. 85, in page 157, leave out lines 9 to 21.
        No. 86, in page 157, line 33, at end insert—
        '(2A) Any fee charged in respect of an approval which, by virtue of sub-paragraph (1) or (2) above, is to have effect as if issued under section 19(1) or (4) of this Act shall be deemed to have been validly charged.
        (2B) Where immediately before the appointed day British Telecommunications has in its possession copies of approvals issued by it under section 16(2) of the 1981 Act, British Telecommunications shall, as soon as practicable after that day, send those copies to the Secretary of State.
        (2C) Neither section 19(10) nor section 21(2) of this Act shall apply in relation to an approval issued by British Telecommunications under section 16(2) of the 1981 Act unless a copy of that approval is sent to the Secretary of State under subparagraph (2B) above.'.
        No. 87, in page 157, line 41 at end insert—
        '(3A) An acknowledgement by the Secretary of State or a person appointed for the purposes of subsection (2) of section 16 of the 1981 Act that any apparatus conforms to a standard approved under subsection (1) of that section shall be treated for the purposes of this paragraph as an approval issued under the said subsection (2).'.
        No. 88, in page 157, line 49 at end insert—
        '3A.—(1) An order made, or having effect as if made, by the Secretary of State under section 37 of the 1981 Act which is effective on the appointed day shall have effect, as from that day, as if made by the Department of Finance and Personnel for Northern Ireland under section 27 of this Act.
        (2) An order made, or having effect as if made, under section 27 of this Act which applies in relation to hereditaments occupied by British Telecommunications and is effective on the transfer date shall have effect, as from that date, as if it applied in relation to the corresponding hereditaments occupied by the successor company.

        239
        3B.—(1) A compulsory purchase order made under section 38 or 39 of the 1981 Act which is effective on the appointed day shall have effect, as from that day, as if made with the consent of the Director, under section 28 or 29 of this Act; and the provisions of the said section 28 or 29 shall apply accordingly.
        (2) A compulsory purchase order made, or having effect as if made, by British Telecommunications under section 28 or 29 of this Act which is effective on the transfer date shall have effect, as from that date, as if made by the successor company.
        3C.—(1) An application for a vesting order made under section 40 of the 1981 Act which is effective on the appointed day shall have effect, as from that day, as if made with the consent of the Director under section 30 of this Act; and the provisions of the said section 30 shall apply accordingly.
        (2) An application for a vesting order made, or having effect as if made, by British Telecommunications under section 30 of this act which is effective on the transfer date shall have effect, as from that date, as if made by the successor company.
        3D.—(1) An authorisation given by British Telecommunications under section 41, 42 or 43 of the 1981 Act which is effective on the appointed day shall have effect, as from that day, as if given by the Secretary of State under section 31, 32 or 33 of this Act on the nomination of British Telecommunications; and the provisions of the said section 31, 32 or 33 shall apply accordingly.
        (2) An authorisation given, or having effect as if given, by the Secretary of State under section 31, 32 or 33 of this Act on the nomination of British Telecommunications which is effective on the transfer date shall have effect, as from that date, as if given on the nomination of the successor company.'.
        No. 89, in page 158, line 35, after 'are', insert `(a).
        No. 90, in page 158, line 35, after 'persons', insert
        'or (b) supplying any apparatus to any persons'.
        No. 91, in page 158, line 38, leave out 'those services' and insert
        `the services or the hire of the apparatus'.
        No. 92, in page 159, line 1, after '(1)', insert (a)'.
        No. 159, line 13, leave out (b).
        No. 94, in page 159, line 21, at end insert—
        `10A. Nothing in this Act shall affect the operation of section 35(2) of the 1981 Act in relation to any order under section 19 of the Local Government Act 1974 which applies in relation to heriditaments occupied by British Telecommunications and is effective on the appointed day.'
        No. 95, in page 160, leave out lines 29 to 34 and insert—
        '14.—(1) It shall be the duty of British Telecommunications and of the successor company to take, as and when during the transitional period the successor company considers appropriate, all such steps as may be requisite to secure that the vesting in the successor company by virtue of section 54 of this Act of any foreign property, right or liability of British Telecommunications is effective under the relevant foreign law.
        (2) Nothing in sub-paragraph (1) above shall be taken as prejudicing the effect under the law of the United Kingdom or of any part of the United Kingdom of the vesting in the successor company by virtue of section 54 of this Act of any property, right or liability of British Telecommunications (including any foreign property, right or liability).
        (3) British Telecommunications shall have all such powers as may be requisite for the performance of its duty under this paragraph but,—

        (a) it shall be the duty of the successor company during the transitional period to act on behalf of British Telecommunications (so far as possible) in performing the duty imposed on British Telecommunications by this paragraph; and

        (b) any rights and liabilities acquired or incurred by British Telecommunications during that period in the performance of that duty shall thereupon become rights and liabilities of the successor company.

        (4) References in this section to any foreign property, right or liability of British Telecommunications are references, respectively, to any property, right or liability of British Telecommunications as respects which any issue arising in any proceedings would have been determined (in accordance with the rules of private international law) by reference to the law of a country or territory outside the United Kingdom.
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        (5) In this paragraph and paragraphs 14A and 15 below "transitional period" means the period beginning with the transfer date and ending with the day on which British Telecommunications is dissolved in accordance with section 63(8) of this Act.
        (6) Any expenses incurred by British Telecommunications in performing its duty under this paragraph shall be met by the successor company.
        14A.—(1) It shall be the duty of British Telecommunications and of the successor company to take, as and when during the transitional period the successor company considers appropriate, all such steps as may be requisite to secure that anything which remains to be done under the provisions of sections 10 and 81(1) of and Schedule 2 to the 1981 Act is done.
        (2) British Telecommunications shall have all such powers as may be requisite for the performance of its duty under this paragraph, but—

        (a) it shall be the duty of the successor company during the transitional period to act on behalf of British Telecommunications ( so far as possible) in performing the duty imposed on British Telecommunications by this paragraph; and

        (b) any rights and liabilities acquired or incurred by British Telecommunications during that period in the performance of that duty shall thereupon become rights and liabilities of the successor company.

        (3) Any expenses incurred by British Telecommunications in performing its duty under this paragraph shall be met by the successor company.'.
        No. 96, in page 160, line 45, leave out from 'period' to 'in' in line 46.
        No. 97, in page 161, line 22, at end insert—
        '18A.—(1) For the purposes of authorising the making, in relation to employees of the successor company or any of its subsidiaries, of provision corresponding to that authorised to be made, in relation to employees of British Telecommunications or any of its subsidiaries, by section 84 of the 1981 Act, that section shall have effect as if—

        (a) any reference to the Post Office or to employees of, persons employed by or employment by the Post Office were a reference to British Telecommunications or to employees of, persons employed by or employment by British Telecommunications; and

        (b) any reference to a relevant body or to employees of, persons employed by or employment by a relevant body were a reference to the successor company or any subsidiary of the successor company or to employees of, persons employed by or employment by the successor company or any such subsidiary.

        (2) Nothing in sub-paragraph (1) above shall he taken as prejudicing the operation of section 84 of the 1981 Act as originally enacted.
        18B. Where by virtue of anything done on or after the appointed day, but before the transfer date, any enactment amended by Schedule 4 to this Act has effect in relation to British Telecommunications then, as from that date, that enactment shall have effect in relation to the successor company as if that company were the same person, in law, as British Telecommunications.'.
        No. 98, in page 162, line 25, at end insert—
        '22. An order under section 19 of the Local Government Act 1974 (rating of certain public utilities and other bodies) which applies in relation to hereditaments occupied by British Telecommunications and is effective on the transfer date shall have effect, as from that date, as if it applied to the corresponding hereditaments occupied by the successor company.
        23. An order under section 6 of the Local Government (Scotland) Act 1975 (valuation by formula of certain lands and heritages) which applies in relation to lands and heritages occupied by British Telecommunications and is effective on the transfer date shall have effect, as from that date, as if it applied in relation to the corresponding lands and heritages occupied by the successor company.'.—[Mr. David Hunt.]

      Schedule 7

        REPEALS
        Amendments made: No. 99, in page 167, leave out lines 42 and 43.
        No. 100, in page 170, column 3, leave out line 33.
        No. 101, in page 170, line 36, column 3, at end insert—
        'In Schedule 1, paragraph 5.'
        No. 102, in page 171, line 10, column 3, at end insert—
        'Section 10.'.
        No. 103, in page 171, column 3, leave out line 11 and insert—
        'In Schedule 1, paragraphs 1 to 4 and 6 to 16. '—[Mr. David Hunt.]

Telecommunications Bill
Order for Third Reading read.—[Queen's Consent, on behalf of the Crown, and Prince of Wales' Consent, signified.]
7.10 pm
Mr. Kenneth Baker: I beg to move, That the Bill be now read the Third time.
I should like to thank the various people who have been involved in the preparation of this immensely important Bill. I should like to thank the officials in my Department who have worked on it, my hon. Friend the Under-Secretary for helping me take the Bill through Committee, the Whips who helped us in Committee, and all my hon. Friends who served in Committee—at least, those who supported us.
I commend the Bill to the House, because it is the most important Bill that we are introducing in this Session. I believe that it will be seen by historians as probably the most important industrial Bill introduced during this Parliament's lifetime.
The Bill completes the revolution in telecommunications which was started in July 1980 by my right hon. Friend the present Secretary of State for Education and Science. The revolution was to liberate the British telecommunications market and to free it from British Telecom's monopoly control and exclusive privilege which it had operated and maintained for nearly 70 years. We embarked upon this policy because the era of exclusive privilege ended long ago in many things and there can be no justification for retaining it in telecommunications.
It is not fair to exclude market entry by other workers, unions and enterprises, all of whom are capible of exploiting the new technology to serve the community better. Those who want to retain British Telecom's monopoly must persuade the House and country that it is better that BT's exclusive privilege should be retained and the exclusive privilege of the Post Office Engineering Union, principally, and also the Union of Communication Workers should be retained so that they should be the only workers privileged to provide telecommunications services.
The arguments put forward by the Opposition are a defence of vested interests. A monopoly control of the market means a shut-out, and that shut-out has damaged the national interest. It has blocked innovation and growth by British apparatus and service providers. Great Britain had about 25 per cent. of the world's markets for telecommunications apparatus 25 years ago. We have now about 5 per cent. One must ask oneself how that came about and why we have declined. Part of the answer undoubtedly lies in the fact that we had a monopoly in the home market that did not stimulate and encourage British Telecom's suppliers to develop new products. Their range of products was limited. The state of technology was often ignored.
The third reason why we are ending the monopoly is that the new technology mircroelectronic revolution has made nonsense of the traditional institutional boundaries. Even Americans have made radical changes in the institutional framework to keep up with the opportunities created by the new technologies.
The second revolution is that we are liberating British Telecom from Government control. BT management and workers want BT to become the flagship of the information

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technology era. To do so it must become market responsive and commercially astute. It must behave like a business. A monopoly is the greatest discouragement to acting like a business. British Telecom has not acted strongly commercially in many respects over the past few years. Since it has been subjected to competition over the past three years its service has improved. That will be the experience of every hon. Member. Waiting lists have been reduced from 120,000 to about 5,000 or 6,000 and trunk line costs have been cut over the past two years. I do not believe that trunk line costs to the ordinary consumer would have been cut if we had not issued a licence to Mercury. It was a great goad to competition for BT. BT has been aroused from its rather sleepy and dozy attitude.
The advantages of freeing BT from Government control and of liberalisation are plain. The customer is given a choice. We have liberalised a huge range of telephone equipment and telecommunications apparatus. Over 40 hand instruments have now been liberalised. The Bill ends the prime instrument monopoly. We have liberalised whole areas of activity, such as telex equipment. Later this year we shall liberalise private branch exchanges and small systems called key systems.
It has all led to an enormous amount of activity among telecommunications suppliers. We are being pressed by companies to liberalise more quickly and to allow equipment to be sold more easily because they are coming forward with their equipment, which is being designed and manufactured in the United Kingdom. It would not have happened if we had not pursued this policy since 1980.
By accepting the recommendations of Littlechild, we are saying that for the next five years the price of telephone rentals and calls to residential subscribers will not increase more than the rate of inflation.
There has been a considerable amount of scaremongering during the Bill's passage. Much of it has been designed to create anxieties. It was said that the Bill would result in services to rural areas ceasing immediately as Keats' nightingale would
"cease upon the midnight with no pain".
Rural services would he cut off because we were to liberalise and privatise BT. In Committee we showed that those anxieties are utterly unfounded.
For the first time in any statute we have placed an obligation upon the Secretary of State and the Director General of Oftel to take account of the needs of specific interests—the disabled, rural and remote areas, the provision of telephone kiosks and the emergency 999 services. That has not been part of legislation before. Under existing legislation, how and where it provided services was up to BT's judgment alone. We have placed obligations and duties upon the Secretary of State and the Director General which they are both obliged to fulfil.
We have said also that any place or people who have a telephone service now will continue to have one, provided, of course, that they pay for it. We have extended that to cover a whole range of telecommunications services. We have given clear reassurances that the network of telephone kiosks will be retained. That network is vital to many rural and remote areas. It is essential for some of the remoter areas of our country and also for towns and cities, as my hon. Friend the Member for Northampton, North (Mr. Marlow) reminded us consistently in Committee. We have also said that the 999 emergency service will be continued as a free service.
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There had been scaremongering about pensions until we gave clear assurances on Second Reading. We have repeated those assurances. I am glad to say that that scaremongering has now come to an end. There has been scaremongering about the number of jobs that might be lost in British Telecom. Telecommunications and information technology is a the most rapidly growing area of industrial activity in the world. In America, which is among the most liberalised and competitive markets, the numbers employed by "Ma Bell" and American Telephone and Telegraph, the big national network, have grown over the past few years, as have the numbers employed by their competitors and the American supply industry.
Consumer interests have been greatly enhanced by the Bill. Under present arrangements, the Post Office Users' National Council has frequently been described by Members of Parliament as a body without teeth. I think that it does a very good job. It handles tens of thousands of small complaints a year, but at the end of the day it does not have enforcement powers. It can take up complaints with BT and persuade it to try to deal with those complaints, but it does not have clout. Under the Bill the Director General of Oftel will have that clout. Oftel will have powers to examine complaints. If a complaint is founded, it will have powers to give directions for the abuse to be corrected. That is a substantial extension of consumer interests.
Hon. Members who served on the Committee will know that in Committee I agreed to set up a national advisory body for England. As one exists at the moment for Scotland, Wales and Northern Ireland, my country should not be excluded. Again, that is an extension of consumer interests.
In the Bill we have also removed the right not to be sued that British Telecom has had because it has been a Crown authority. In future, customers and subscribers will be able to sue BT for the non-performance of service. Again, that is a substantial improvement in the rights of consumers. We have also approved clauses to allow new meters to be approved that will give a greater guarantee on bills. The most frequent complaints when telephone bills are 'wrong or too high is that the expense of someone else frequently telephoning to America always seems to be added to the wrong bill. We have also encouraged the introduction of trial systems to allow detailed telephone bills to be supplied.
The Bill is a great liberalisation measure. It is also a great measure of denationalisation. It is the biggest measure of denationalisation that has ever been brought before the House or any western country. It is often referred to as privatisation but that is a misnomer for the returning to the people of proper ownership. When the Labour party speaks of state control and nationalisation, it must realise that state control is by a bureaucratic elite. It is not control by the people. The right hon. Member for Salford, West (Mr. Orme) will know that because he has held high office, and any Minister will know that the control of a nationalised industry is essentially by bureaucrats. State capitalism is the worst and basest form of capitalism.
Mr. Richard Shepherd: Is my hon. Friend suggesting that ICI is controlled by the people?
Mr. Baker: I am suggesting that ICI is controlled by its managers—the senior team of managers. It is controlled

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by the market in that it has to exist in the market and go to the market for its survival. I am surprised that my hon. Friend, of all people, should make that point. He has been one of the greatest enemies of monopoly and state control. He should seek every opportunity to forward the argument to defeat the forces of state capitalism, from which part of our economy still suffers.
The sale of shares gives an opportunity for all workers in and subscribers to BT to take a share in the business. Already that is common practice in many parts of the world. AT and T, the largest telecommunications operation in the world, has 3 million shareholders. Nippon Telephone and Telegraph in Japan has many millions of bond holders. There are 18 million telephone subscribers in the United Kingdom. Many of them will want to become shareholders when the opportunity comes after the next election. Many members of the public will want to be shareholders. Institutions will want to be shareholders. I suspect that employees will want to be shareholders. We are in favour of the employees of BT becoming shareholders.
We had evasive answers from the Labour party when we asked it whether it approved of the employees of BT being allowed to become shareholders. The right hon. Member for Salford, West said that for his part he would not want to be a shareholder. However, we were asking him not for his opinion but to give some advice to the employees of BT. What is his advice? Will he encourage them to buy shares in their business? Will they, will they not? Will they join the sale? There are signs that many of them would like to have the opportunity to do so. There have been requests from pensioner groups of BT for a special position, if special positions exist for employees as well. I should like to know whether the right hon. Gentleman wants us to include in the memorandum and articles of association special provisions to allow employee shareholdings.
Mr. Dafydd Wigley: I have been listening to the Minister's recommendation of employee shareholdings. Will he go as far as to say that he would welcome a majority shareholding by employees so that they would be the controllers of the new corporation?
Mr. Baker: We intend to sell 51 per cent. of BT. We have said that that would be offered on a wide scale. If all the employees of BT wanted to club together, they would have to provide a considerable sum of money to buy that amount, but we are the encouragers of wider share ownership.
Another advantage of the privatisation of BT is that it will not be bound by the state. It will be much freer. One of the largest telecommunications operators in the world is the Japanese system, NTT, which is the equivalent of BT. At the moment the workers are asking for their organisation to be privatised. They look upon that as a way of being most effectively able to compete with American competition.
The advantages of privatisation for BT management are manifest. It will have the freedom to manage without constant interference from the Government. It will have the freedom to diversify, to make commercial acquisitions, to operate abroad, to raise finance if and when it wants and in whatever form it wants, to structure tariffs in response to market needs and perceptions and to
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determine pay. The advantages to BT workers of privatisation are that they will have the freedom and opportunity to own shares, to move into new areas of activity, both at home and abroad, to participate in the key decisions of the enterprise, if they want to exercise that freedom, and to negotiate pay and conditions without Government interference.
Mr. Tony Marlow: Will my hon. Friend say—he has said it before—to what extent BT would have the freedom to go into manufacturing, and how we could prevent a monopoly arising whereby there would be unfair competition with competitors?
Mr. Baker: My hon. Friend will know that one of the draft articles of association says that BT should be allowed to manufacture if it wants to do so. I do not expect that BT will want to extend dramatically into manufacturing. If it does, it will have to be bound by the provisions of the telecommunications competition code of the draft licence.
There are advantages in privatisation to BT management and BT workers, but there are also advantages for BT consumers. They, too, will have the opportunity to own a share of the telecommunications system. They will, if they wish, have a greater say in the management of that enterprise.
There are also advantages for the nation at large. The revolution that we have initiated will mean a massive redistribution of opportunities for the provision of telecommunications apparatus and services.
During the course of the Bill we have tried to elicit the views of the various parties on this matter. The SDP has been particularly evasive. We have not been able to discover during the proceedings on the Bill exactly what is the SDP policy on telecommunications.
Dr. John Cunningham: The SDP did not say anything about its policy in Darlington either.
Mr. Baker: The hon. Member for Whitehaven (Dr. Cunningham) says that the SDP did not divulge that important information to the electors of Darlington. The SDP did not divulge the information because it does not have it. At the very centre of SDP policy is a hollowness and a complete vacuity. I do not know whether the hon. Member for Islington, Central (Mr. Grant) will attempt to fill that, but if he is trying to present a national policy to the country it is important that he should have policies on the new technologies and on telecommunications, which are the fastest growing areas of economic activity. If the SDP is trying to solicit votes, it owes it to the country to spell out its policies.
The Liberals did not seek to put a member of their party on to the Committee. I found that extraordinary as this is the most important Bill of the Session. I should have thought that they would give it higher priority. Once again, we have not heard the Liberal policy on liberalisation or privatisation.
Mr. Penhaligon: Will the Minister give the House some idea of how many Committees it is practicable for a Member to serve on at any one time?
Mr. Baker: One must have a sense of priorities. A sense of priority would have been to ask one of the Members of the Liberal party to serve on the most important Bill of the Session. Anyway, we did not miss the Liberals very much. None the less, the one Liberal policy over the years That I seem to have latched on to is

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the belief in wider share ownership. That is one of the issues that the Liberal party has preached around the country. Liberals say, "We want wider share ownership so that people can be involved in our society." The Liberals have held conferences about it and issued pamphlets. They are being given an opportunity tonight to vote for it. The Bill, when it becomes law, will provide a great opportunity for wider share ownership—the greatest before the House of Commons since the war—but will they vote for it? When the Liberals are faced with the red meat of a real decision they are a little too fastidious. They say, "Do not thrust that decision upon us." They believe in the principle but when offered a chance to fulfil something they walk away from it. That has been the essence of Liberalism over the past few years.
I turn now to the Labour party's attitude. In Committee we have had a delightful tug of war between the hon. Member for Newcastle-under-Lyme (Mr. Golding) and the Labour Front Bench. It was a tug-of-war between the Post Office Engineering Union and official Labour party policy. We heard lectures from the hon. Member for Newcastle-under-Lyme, and we are about to have another one.
Mr. Golding: Where was the tug-of-war? I had assumed that the two views were synonymous. Will the Minister tell us where they differed?
Mr. Baker: The hon. Gentleman may recall several occasions in Committee when he gave clear guidance to his colleagues on the Front Bench. That guidance was not entirely followed.
Mr. Golding rose—
Mr. Baker: I do not object to that, but there have been such occasions, as the hon. Gentleman knows. The Committee stage was subject to a great deal of abuse. There were about 160 hours of debate. Labour Members who spoke at great length will have to answer certain questions about that. How, as a result of their filibustering, did they improve the Bill? They did not. When closely examined, the record shows that they had little effect in making significant changes in the Bill. The views that were put forward by several of my right hon. Friends stiffened the anti-competitive measures in the Bill. If the Opposition had been cleverer tactically, they could have gained quite a few victories, but in 160 hours of debate they achieved virtually nothing.
The policy that has been enunciated by the Labour party today is clear. Labour wants to restore the monopoly of British Telecom, as set out in paragraph 41 of the Labour party document. It also wants to sweep the Mercury network into that monopoly and take it into public ownership. That is a clear statement. The document also gives the Labour party policy on the electronics industry. Earlier in the debate, I was intrigued when the hon. Member for Whitehaven quoted in support of his argument the views of Lord Weinstock on cable. The hon. Gentleman said that this is not an area for the quick buck merchant. I am surprised therefore to find a euphemism for Lord Weinstock in the Labour party document. The Labour party says in that document that it wants to return to public ownership without compensation the public assets and rights hived off by the Tories. It says:
"We will establish a significant public stake in electronics."
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That is a euphemism for Lord Weinstock. The Labour party wishes to take into public ownership a large part of the major electronics companies—Plessey, GEC, Ferranti and others. We now know where the Labour party stands.
I can think of no policy that would be more damaging to our country. One has only to consider what has been happening in France since such a policy was adopted two years ago. The massive nationalisation programmes of the French Government are running the country into near-bankruptcy. The losses of the nationalised industries in France are increasing and the enterprising and Lively French electronics industry is going through a difficult phase. The same thing would happen if the Labour party were to gain power and introduced such policies.
I have looked through the document today and it does not look to the future. It looks backwards all the time. It restates the policies and the attitudes which the Labour party has tried to follow and has instituted since the war, which have manifestly failed the country. The Labour party is marching shoulder to shoulder, but is marching backwards into the past.
The Bill is legislation for the future. The whole of Government communication policy is aimed at giving Britain the most advanced infrastructure and base from which to gain a pre-eminent place in the telecommunications era before us. We believe that this can be done only if the market is driven forward by competition and not dominated, corrupted and destroyed by monopoly.
7.38 pm
Mr. Orme: In the past 10 minutes we have had a political knockabout from the Minister.
Mr. Peter Temple-Morris: A political knockout.
Mr. Orme: I shall have something to say about the political situation and the attitude that we shall take to the Bill.
The Bill has had a long road, from last November until April 1983. We are nowhere near the end of that road, only part of the way down it. As the Minister knows, this will be a major issue at the general election. We shall want to debate this issue with the British people with all the facts on the table. We shall not be ashamed to put forward the policy that we have advocated throughout the Committee stage.
I wish to take this opportunity to thank all those who have opposed the Bill, especially my right hon. and hon. Friends who served on the Committee. I also thank all those who intend to vote against the Bill tonight. I wish to pay tribute to the experts who provided help and advice, not least the trade unions, the communication workers and the POEU. We are not hiding behind any organisation. We have debated the issue in the open. But we are pleased to pay tribute to those who gave us help and advice. We have been dealing with a highly technical and difficult Bill. I have not previously dealt with a Bill including so many technicalities. Although three of my hon. Friends have great expertise within the industry, most of us have had to deal with the Bill as it has progressed.
Despite the Government's appalling record in selling publicly owned industry, they will not swerve from their intention to conduct what has become known as the sale of the century—the sale of British Telecommunications in

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the market place. The Government cannot pretend that such major legislation, which has taken so much of the time of the House, will benefit the nation.
I agree with the Minister that the Bill is the most important legislation this session. It is a major piece of denationalisation—it will denationalise a national asset that belongs to the British people. The majority of the control of BT will be handed over to a minority in our society.
British industry is in a critical state, with millions of workers in the dole queue. Yet the Government chose to spend their time, money and resources on producing such a terrible Bill. That gives some idea of the Government's priorities. How dare the Minister criticise the French when British manufacturing industry is collapsing around him? It is in a parlous state. Its decline has accelerated during the past four years of Conservative Government. He has no need to go to France to find something to criticise—he has only to look to his own back door.
Mr. Marlow: I am grateful to the right hon. Gentleman for giving way. He is courteous, as he has been throughout the whole process of the Bill. I am grateful to him now, as I have been on previous occasions. He made a point about dole queues and jobs. Is he telling the House that for the same level of provision of telecommunications service, if BT were left as it is it would employ more people than it will under the Bill? If so, it is purely a recipe for inefficiency and for bleeding the public.
Mr. Orme: I shall say something about manning levels later. The Minister referred to scare stories. The staff of BT could be maintained at its present level, or even increased if that is done on a planned basis, if investment is made and if it is allowed to borrow money in the market. BT has made a profit for the past seven years. It has not taken any taxpayers' money during that time. Unfortunately, it must live on its profits and has not had sufficient to invest. If BT were left as a publicly owned monopoly, it would expand. As the Minister said, we are in an expanding market. Rather than take the gamble presented by the Bill, and rather than face a two-headed monster that will be half public and half private, with the uncertainty which that will create, BT should remain in public hands.
On Second Reading and during the 168 hours of debate in Committee, the Opposition made clear their opposition to the Bill. I make no apology for the amount of time taken. We were using parliamentary means to oppose the Bill. Because of the philosophical difference between the Opposition and the Government, there was no way that an accommodation could be reached. The gulf between us is as wide as this Table. The Government may have given a little here and a little there, but the Opposition are wholly opposed to the principles enshrined in the Bill.
During the past few days we have shown that we are opposed to any attempt to privatise BT. It is unnecessary, divisive and against the interests of the community. Because BT is a publicly owned corporation, it is fully accountable to the community for what it does and the way that it does it. The public have statutory rights to consumer watchdogs. There is direct control by Government. We want that control to be strengthened and BT made more accountable. Whatever organisation the Minister intends to set up, it will not be as strong or as effective as POUNC.
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BT's plans are monitored and important matters that are not concerned only with profit maximisation are built into BT's operation. As a publicly owned corporation, it has essential social and community obligations that are directly linked with the quality of community life.
Underlying all BT's current operations is the belief in providing a national service—one integrated telecommunications network that is publicly owned and operated. All citizens should be entitled to a high standard of telephone service, irrespective of geographical location, social circumstances or whether they are business or residential customers. The philosophy of a national service for all will be severely restricted if BT is privatised.
During the debate on the original clause 3, and the new clause now in the Bill, the Minister went to great lengths to argue that rural services and emergency call services would not be damaged, that the cost of the service would not rise and so on. He went to tremendous lengths to try to prove those points, but he has not proved them to the satisfaction of the House or the country. BT will be in an entirely different ball game. The anxieties that have been expressed by hon. Members on both sides of the House about the rights of consumers, about the rural telephone service and about telephone kiosks in built-up areas such as my constituency in Salford and in London, will be proved well founded. Those services will come under tremendous pressure. Privatisation will lead to the diminution of those services at the expense of the community.
The shareholders will have to be satisfied by the production of a maximum return on their investment. The provision of loss-making services will come under real attack if we are not careful. We shall monitor that carefully if, by some ill fate, the Bill becomes an Act of Parliament and the Government are able to implement it.
The Minister referred to the participation of BT employees as shareholders. Thousands of workers depend on BT for their jobs and futures. About 250,000 workers work directly for BT and tens of thousands more work for equipment suppliers. How many of them can be sure that their jobs are safe? Private forecasts which became public showed that between 35,000 and 40,000 jobs were threatened. It was against that background that we told the Government that jobs were in jeopardy.
The Minister said that we should let employees buy shares. As he knows, there is not a closed shop in BT, but about six trade unions represent about 97 per cent. of its employees. There are management unions and the Union of Communication Workers and the Post Office Engineering Union, which are affiliated to the TUC. All of them oppose what the Government are doing. Our advice to the employees of BT is, "Do not buy shares." Buying shares will not be in their long-term interests. Someone asked whether they could get a majority shareholding. That idea might be attractive to some of the minority parties in the House.
We should consider some of the major industries that the Government have denationalised. What percentage of British Aerospace do the workers there own? The answer is about 3 or 4 per cent. It is impossible for workers in BT to have anything like a controlling shareholding as the floatation will be about £3 billion to £4 billion.
Mr. Temple-Morris: Will the right hon. Gentleman reconcile what he is saying with a question that I put to one of his hon. Friends in Committee with regard to the first

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so-called privatisation—of the National Freight Company? After last year's results were announced, the argument and trouble was not about workers who had bought shares but about those who had not bought shares and felt that, because of the great profit, they should have been allowed to buy them in the first place and should be able to buy them on the same terms now.
Mr. Orme: The National Freight Corporation would make an ideal co-operative. It is impossible to make BT into a co-operative.
It is clear from what the Secretary of State and the chairman of BT, Sir George Jefferson, have said that the possibility of redundancies exists. British Airways, the National Freight Company and the British Transport Docks Board have been privatised by the Government. All suffered reductions in their work forces either immediately before or after they were sold.
Mr. Marlow: Will the right hon. Gentleman remind the House what has happened in terms of jobs to those nationalised industries that have not been privatised?
Mr. Orme: Under public ownership and planning, an endeavour has been made to maintain employment and extend markets for the product. Unfortunately, we have been faced by a Government policy during a depression and a time of lack of demand which means that jobs in both the public and private sectors have gone.
Workers in equipment manufacturing companies are not complacent either. Before liberalisation in 1981, BT bought more than 95 per cent. of its equipment from United Kingdom based companies. According to The Sunday Times of 20 March, Sir George Jefferson is
"determined to transform the relationship with BT's traditional suppliers".
He is aided and abetted by Mr. May of Martlesham. Indeed, Sir George Jefferson has started to place small orders overseas. Privatisation will increase the trend to import equipment. I hope that Conservative Members will bear in mind the fact that we are dealing with thousands of jobs in the private sector which are dependent on BT. They represent some of our major manufacturing industries. If we allow imports which are of a lower safety standard to flood in, the consequences will be disastrous both for BT and for employees in equipment manufacturing companies.
Mr. Henderson rose—
Mr. Orme: I hope that the hon. Gentleman will forgive me if I do not give way.
Employment prospects for the visually handicapped are also at risk. We welcome what the Minister included in clause 3 about handicapped people. However, BT has undertaken development work to ensure that most of the smaller boards that it markets can be adapted for use by blind operators. As an increasing amount of equipment is imported, there is a tremendous fear that boards that are not adapted for use by blind operators will flood the market. Therefore, their employment opportunities will be drastically reduced. Anyone who has seen blind people use telecommunications equipment as well as and, sometimes, better than many other people will agree that they are entitled to such opportunities. It would be extremely serious if their opportunities were jeopardised.
The recently published report of the Institute of Fiscal Studies shows the dramatic extent to which the
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Government have divided the nation and how they have taken from the worst off and given to the better off. This Bill is another example of the Government's lack of social conscience. Another two nations will emerge—people with and people without telephones and telephone services.
The Government have failed to serve the nation as a whole. They have put more wealth and power into the hands of the already wealthy and powerful, and they continue to do so. This Bill will serve only to deepen that divide. Consumers, employees of BT and workers throughout the telecommunications industry are more likely to suffer than to benefit from privatisation. The beneficiaries will be the speculators, the overseas equipment manufacturers and the importers.
That is the sorry tale of the Bill so far. We know that it will be a general election issue and we shall debate it throughout the country. We shall continue to oppose it. We repeat to those people who try to make a profit from public assets that the next Labour Government will restore the public telecommunications monopoly to BT. As the Minister said when he read from our policy statement, that will include project Mercury. We shall put the Bill on the shelf and invest in the future of telecommunications in Britain. We believe that telecommunications has a great future for Britain and that it should be owned by Britain.
7.59 pm
Mr. Peter Temple-Morris: I am pleased to follow the right hon. Member for Salford, West (Mr. Orme) because it gives me the chance, as the first Back-Bench Member to address the House on Third Reading, to pay a few compliments. I reiterate what my hon. Friend the Member for Northampton, North (Mr. Marlow) said in an intervention. We are grateful to the Opposition for their ever-courteous and able conduct during such a controversial Bill. Our system may not be perfect, but it would not work were it not for the way in which both sides of the Committee conducted matters. They made their differences plain, but always in such a way that we could go through the night together, week by week, without coming to physical exchanges.
The right hon. Member for Salford, West was ably aided by his deputy, the hon. Member for Whitehaven (Dr. Cunningham). We reached a stage where, in the middle of the night, all-party deputations were sent to the Tea Room to interview the hon. Member for Newcastle-under-Lyme (Mr. Golding) to ask him to desist, which he invariably did, albeit after four, five or even 11½ hours. I am pleased that he has now retreated as far as he can, although he remains within the Chamber and, therefore, must be treated with the necessary respect.
Back-Bench Members and Opposition Front-Bench Members are grateful for the aid they received from outside bodies. The National Farmers Union and British Telecom were a great help to me. We must remember those who sat with us during our long nocturnal sessions, whether from British Telecom or the unions. A gentleman from Cable and Wireless was about to lay a cable in the south Pacific, and was obviously dreaming of doing his first hula-hula, but was dramatically reassigned to observe the Committee by day and by night. I hope that his employers will take note of my words and let him lay his cable somewhere more congenial than the Committee Room.

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Although my words may be slightly flippant, they have a serious purpose. Although our system is remarkable in that the camaraderie allows it to survive, it is, as my hon. Friend the Minister said, not healthy. We must find a way of devising an automatically agreed timetable, and there is much agreement on this on both sides of the House. The matter arose many times during the debate on the guillotine motion, but I want it to be placed firmly on the record because it will be most important in the future.
Mr. Robert Hughes: Many of us are opposed to agreed timetables, because the Government would have no opposition and could carry on as they wished. The Opposition have a duty and a responsibility to harry the Government for as long and as hard as they can.
Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. As the hon. Member for Leominster (Mr. Temple-Morris) had raised the matter, I allowed the intervention, but he must not pursue it. We must return to the Third Reading of the Bill.
Mr. Temple-Morris: Of course, Mr. Deputy Speaker, but perhaps I may answer the intervention. As the right hon. Member for Salford, West said, where there are ideological differences, one must resist the Bill. That was implicit in the hon. Gentleman's intervention, but to oppose it in that way amounts to no more and no less than machismo. As my hon. Friend the Minister said, the achievement is minimal. If we had a more effective system, where by an Opposition could agree to time and to a system that resembles the thorough examination of a Select Committee, the Opposition might achieve something. They might, through their arguments, attract a Government Back-Bench Member like me to help them to improve or alter a measure. This is a classic example of a Bill that could have been examined in that way.
The Bill has been hurried, and the amendments to our beloved old clause 3—as it came to be called yesterday evening—might have been refreshing for democracy, but were not ideal for legislative principle. I wish to help my hon. Friends the Ministers, but it is clear that too much happened outside the Committee for comfort, especially the discussions on the licence which took place and continue to take place. Neither we nor the Minister knows when British Telecom will agree the licence. However, when the Bill is enacted and we lose our authority over it, we must rely upon Ministers to secure from British Telecom the terms of the licence set out in "Ringing the Changes". This becomes increasingly important as the Bill leaves the House and goes to another place. I hope that my hon. Friends appreciate my point. If I were British Telecom, I should delay negotiation on this matter until the Bill had cleared the House, because then I could negotiate much harder.
In many respects "Ringing the Changes" is an admirable document. Although I and many others have criticised it, it contains only a submission of what the Department would wish to see in the licence. Part 3 of the document contains many good provisions for rural areas. We shall expect my hon. Friends to live up to those terms during negotiations on the licence.
Another outside factor was the Littlechild report, which was a further sign of the way in which the matter was
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rushed. Policy matters regarding the implementation of the Bill were being decided outside the Committee room while we soldiered through our 161½-hour nocturnal venture. I regret that some hon. Members wish to continue that, because I have sat through such sittings while in opposition, as have most hon. Members who have been Members of the House for more than one Parliament.
Despite the definitive answer of my hon. Friend the Under-Secretary of State last night about duty being written into clause 3, or appearing in the margin, the new clause will be debated in another place. I do not expect my hon. Friend to comment at length on this matter, but perhaps he will consider writing the word "duty" into the clause, bearing in mind that it is already in a subsequent clause. I cannot understand why it is not in the clause, and I feel that it should be there. I take the point that "shall" equals a clear duty in this and other clauses, but when the Bill goes to the other place, will those responsible note that "duty" should go into the clause? I hope that their Lordships will table an appropriate amendment.
I shall repeat a question that I have asked the Minister twice, but to which I have still not had a reply. Perhaps I might have a letter on the subject. It is something that tends to drift by, probably because one is raising more serious matters that require more of a ministerial answer, and concerns paragraph 19(c) of "Ringing the Changes". I put it in Committee, I put it last night, and I put it again now. If one wanted to be argumentative, one could make more of it. Paragraph 19(c) of "Ringing the Changes" says that the service does not have to be connected, and it is not reasonable to connect, if the person concerned
"will not pay BT the costs attributable to the supply to that person of the service".
That appears to be intended to meet the circumstances that happen every day where BT has to charge for the connection of the supply if it is not otherwise economic to instal it. It is meant to cover the provisions that have always been there. However, as it reads now, it is still not finally negotiated. This is a potential threat to all the rather good things in the rest of "Ringing the Changes" that affect rural areas.
We need at least a recognition of the problem of public call boxes during the transition. If there is to be a longish transition, BT, flexing its capitalist and privatised free enterprise muscles, may be tempted to get rid of more public call boxes than would otherwise be necessary. Some recognition of that would be a help, whether it comes in a letter to me or in the winding-up speech.
This is a good Bill. I have tried to do my best for the interests that I represent. The Bill can do nothing but good, and can improve BT. The problem is that it might even make BT too good, and we shall have to spend too much time trying to control the private monopoly that we have created.
The Bill is good for the brave new world of technology. It gives formidable powers to the Secretary of State and to my hon. Friends the Ministers who serve under him, who are to use those powers in the public interest. It is perhaps as a word of caution as well as congratulation that I say that we depend on them to use those powers well.
8.13 pm
Mr. Gordon Oakes: The hon. Member for Leominster (Mr. Temple-Morris) has rightly entered a number of caveats from the Conservative Benches about various aspects of the Bill. There is an ideological divide

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between the hon. Gentleman and me, but I agree that this has been a hurried and sloppy Bill. The Minister for Industry and Information Technology said that this would be the most important Bill of this Session of Parliament. If that is so, it is a disgrace that so many important matters that affect ordinary people and local authorities have been completely ignored and, because of the guillotine, have not been discussed by the Committee or the House.
The Bill literally affects the man and woman in the street, especially clause 9 and schedule 2. Quite apart from the ideological divide between both sides of the House, such a sloppy Bill should not have received a Third Reading. I am speaking from the Back Benches, not as a shadow spokesman for the environment but as the vice-president of the Association of County Councils, which Conservative Members will realise is by no means a Labour body. It is dominated by Conservative shire councils in England and Wales. It has written to me as its vice-president asking me to raise on Third Reading its sincere and acute concern at some of the provisions of the Bill as they affect local authorities.
County councils are responsible for 96 per cent. of the road network, and the Department of Transport is responsible for only 4 per cent. One of the principal concerns of highway authorities is the effect of digging up roads. Holes in the road are dug by statutory undertakers, under the powers given to them by various Acts to install communication systems, electricity systems and gas systems, and for all sorts of other reasons.
The Association of County Councils points out that even with the best possible reinstatement, simply digging up a highway involves destruction of its integrity, with eventual road maintenance implications for local authorities. Only last week, on 23 March, evidence was given to the Select Committee on Transport that showed that there were approximately 1·8 million highway openings in England and Wales in 1982. Evidence was also given to the Committee that the severe weather that we had last winter did great damage to our road system, 30 per cent. of which was directly the result of trench reinstatement.
One would have thought that at least a Conservative Government would have had some discussion with county councils on the Bill and would have done something about those discussions. However, they have done nothing. Clause 9 ignores the representations of local authorities that are acutely concerned that the number of people digging up roads will multiply as a result of the Bill. Not only that, but whereas the statutory undertakers who now dig up the roads—the water, electricity and gas boards and BT—are responsible public bodies, with a responsibility to the public and not only to their own pockets, the people who will have power under schedule 2 and section 9 to dig up the roads will be people whose thoughts are dominated not by the public interest but by private profit and cheeseparing on behalf of their shareholders.
So what about local authorities? This Government have so severely restrained their direct labour departments as a deliberate act of policy that those departments are no longer there to do the necessary reinstatement work. They have so toned down the number of administrators and inspectors of local authorities in their financial restrictions on county councils that local authorities can no longer provide the necessary supervision of roads that are broken open by statutory undertakers. Local authorities can place only a certain amount of reliance on nationalised bodies
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such as the electricity and gas boards and so on, when they dig up roads. They have little faith in private bodies whose main concern is not the public interest, but private profit, when they do reinstatement work after installing a system or repairing a system that is already installed.
This is a serious matter to which the Government should have paid much greater attention. I do not say that they should have listened to the voices of those who are dogmatically opposed to the Bill—that is certainly not true of the Association of County Councils, which is not opposed to the principles of the Bill, but to the sloppiness of clause 9 and schedule 2—but they should have paid attention to the interests that clearly affect every roan and woman in the street.
That is the problem when private undertakers dig up roads. There is another problem. What if the bodies created by the Bill go into liquidation? Public authorities do not go into liquidation; private authorities can do so. Who picks up the tab? Who has to pay? The ratepayers, about whom Conservative Members are so concerned, have to come in when a firm goes bankrupt and reinstate the road that has been damaged by the private operator. No doubt the Minister will say in reply that amendment No. 105, rushed through the House earlier under the guillotine, adequately deals with that consideration. It does not. It far from satisfies the Association of County Councils, and it should far from satisfy this House in deciding whether to give the Bill a Third Reading.
The association and all local authorities would like licensed operators to be subject to section 181 of the Highways Act 1980. That section allows the highway authority to decide to license the breaking of the highway and imposes its conditions on people who break into the highway, because it, as the highway authority, has the responsibility of putting matters right. The Bill as drafted does not have that effect, and the association is concerned about the wide drafting of clause 9(2), which seems to provide the Secretary of State with a wide discretion to apply the telecommunications code—and with it, in effect, the rights of the statutory undertaker—without any consultation with either local authorities in general or with the particular county council that is responsible for the roads in the area.
The association did not just raise the matter now, on Third Reading. It took the matter up with the Minister before Christmas. It has had discussions with the Minister before Christmas, but those discussions have still not been resolved. The Minister could have tabled amendments to the Bill on Report to put the matter right. The association is worried and alarmed that the Minister did not do so. I only hope that the Under-Secretary, in winding up, will at least assure local authorities that the matters that I have mentioned in opposing the Third Reading will be put right in another place.
8.22 pm
Mr. Richard Shepherd: One cannot doubt that the right hon. Member for Widnes (Mr. Oakes) is a Front-Bench spokesman. It is curious to note the way in which we already rewrite the history of our Committee proceedings. It is true that much of the Bill was not discussed, and that important concepts have gone by the by. Last night, the Opposition spokesman, the hon. Member for Whitehaven (Dr. Cunningham), tried to give himself and his colleagues a more heroic role than they in fact played in our proceedings. I would not have

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mentioned that, but the hon. Gentleman made a gratuitous reference to my hon. Friend the Member for Leominster (Mr. Temple-Morris) and me in connection with the role that we could have played in Committee, had we been more assiduous—or something along those lines.
Dr. John Cunningham rose—
Mr. Shepherd: I shall not give way, because the hon. Gentleman did not give way to me last night, and I do not propose to give way to him tonight. I made the observation because we believe that this is a highly important Bill. The fight that was undertaken on behalf of rural constituencies by my hon. Friend—
Dr. Cunningham: Will the hon. Gentleman give way now?
Mr. Shepherd: I shall do so on this occasion.
Dr. Cunningham: I am grateful to the hon. Gentleman for giving way. I have not checked Hansard to see what I said last night, but I said then, and I repeat now, that Conservative Back Benchers had missed an opportunity, with the honourable exception of the hon. Members for Leominster (Mr. Temple-Morris) and AldridgeBrownhills (Mr. Shepherd). I was not criticising the hon. Gentleman. I was paying him and his hon. Friend a compliment. I think that he has completely misunderstood what I said.
Mr. Shepherd: I look forward to rereading the hon. Gentleman's comments.
I commented on the rewriting of history because if one looks at the amendments moved in Committee and the Front-Bench speeches that were made in Committee, one sees that the hon. Member for Whitehaven was conspicuous, almost, by his absence. I understand that. I regret saying so, but he was conspicuous by his absence from our debates on clause 1 having decided to be elsewhere during our discussion of such an important issue.
I am conscious, too, that the steps taken to improve the standards and quality of the Bill by the hon. Member for Caernarvon (Mr. Wigley) played an important role in strengthening some of our attitudes towards the protection of rural services.
Ministers know that I had grave doubts about transferring a monopoly from public to private ownership. I could not see why one should consign to limited private interests the ability to extract from the community profits higher than would accrue in a competitive arrangement, and to provide a service that would be subject only to a limited check. I argued that in any transfer it was important to ensure that there was a clear and strong regulatory function laying identifiable duties upon the Director General of the Office of Telecommunications. My first reading of the Bill suggested to me that the defences and protection for the consumer were inadequate, and I am not entirely satisfied that we have arrived at the most adequate arrangements to protect us during the transitional period.
Ministers argue that regulation inhibits the development of an industry and that therefore we should take the important stride of moving from a non-competitive monopoly to an open and competitive position. I support that attitude, and during our discussions on the Bill I have argued that the transfer should be made as rapidly as
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possible, but in reality it will not happen for many years. Even Ministers have argued that a dominant monopoly will persist for many years to come. I want the Bill to be an engine for competition, but on that level the Bill is rather weak. The Minister of State has said that I misunderstood the extent to which he has liberalised the service, but words are not sufficient in themselves. The Minister of State said yesterday:
"At present the public telecommunications operators that we envisage licensing under the legislation will be BT, Mercury and Hull, and two radio-telephone networks."
He continued:
"It is not our intention in the foreseeable future to go beyond that."—[0fficial Report, 28 March 1983; Vol. 40, c. 51.]
Where is the engine of competition there? We had already announced, in the absence of privatisation, that Mercury should come into existence, and Hull has been in existence for many years. The great step forward, therefore, is reduced to two radio-telephone networks. That is hardly a great engine for competition, yet that is what we pin so much of our faith on.
I am anxious about this matter. I therefore urge my noble Friends to consider carefully what we mean by an engine for competition. I argued yesterday that perhaps we should have added a clause to insist that licences should be granted in the absence of compelling reasons why the granting of a licence would be damaging to the overall system. I argued also that if a licence is refused, the reasons for refusal should be published, and possibly even that one should have access to the courts to challenge the reasons given either by the Director General of the Office of Telecommunications or by the Secretary of State.
One must look at actions as well as words. I accept the observations of Opposition Front and Back Bench Members that the Bill was hastily constructed and ill thought out in many regards. The little niggles that suggested to me that the intentions of the Bill as originally framed were not as generous as the words resided in such pointers as the Government's initial reluctance to accept the non-discrimination principle, which is of the essence of the protection of our freedom and choice in the market place. If a private monopoly were able to discriminate against one class of customer or one business as opposed to another, our commercial freedoms and independence would be at risk.
Ministers referred to the Bill as an engine for liberalisation and change in our telecommunications system, but what did the change amount to? The first instrument monopoly was to remain, but it would no longer be a public service monopoly. It would be a private monopoly, consigned to private hands. Private individuals would thus be able to seek whatever return they wished for the use of their services.
As the Opposition know, I greatly resent monopolies, duopolies and oligopolies. I could not understand how Conservative Ministers could argue that British Telecom as a private company should retain the right to insist on people buying the instrument of its choice, presumably at the price of its choice. That was clearly wrong. Yet my approaches to Ministers on the subject were rejected. One of the lessons of serving on a Bill of this kind is the appreciation that our own influence with our colleagues is perhaps less than that of outsiders. It took Professor Littlechild to concentrate my hon. Friend the Minister's mind on this. Conservative Members had argued last year and in 1981 for the removal of the prime instrument

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monopoly, but our case was rejected until Professor Littlechild argued that the monopoly was unacceptable. He said that it ought to go, so go it did.
In attempting to read the Government's mind on these matters, a little incident yesterday shocked me profoundly. It may not have shocked other hon. Members, as I could not find a colleague to join me as a teller in a Division. I refer to new clause 5. My interpretation of that proposal was not rejected by the Under-Secretary of State. As I understand it, if a licensee—possibly a mighty monopoly such as British Telecom—acted in breach of its licence or its obligations under the Bill in such a way as to damage the commercial viability of or cause losses to another company or individual it would not be open to the aggrieved party to sue for damages in court.
In my view, it is a fundamental principle of Conservative philosophy that if one is damaged by the actions of another party in default of a statutory duty laid down by way of a licence one should have a claim against that party. In such circumstances I could be put out of business, or my constituents' prospects could be destroyed. Whether that is done casually or deliberately, we should surely be able to ask a court to judge whether the action was fair and whether compensation or damages should result.
Having read the reply of my hon. Friend the Under-Secretary of State to that case, I can only say that I shall not look to him in the future for the defence of my freedom, prosperity and commercial success. I was deeply despondent at the way in which he rejected the seriousness of the argument. He could have agreed to give the matter further consideration, but it seemed that whatever the risk or damage to a company or individual the overriding consideration was that there should be no inhibition to the introduction of new technology and new processes and the advancement of the telecommunications industry.
Whatever else Members of Parliament may be, we are surely defenders of the rights and protection of smaller businesses and individuals. I respected those who fought hard and long to protect the interests of rural residents and the services necessary to make their lives tolerable and acceptable. That is a first condition of the Bill and I am glad that in new clause 1 the Government made it a matter of paramount importance.
One or two other very important issues have not been dealt with so far.
The purpose of transferring a monopoly and introducing competition with a regulatory authority was to ensure that no dominant supplier could abuse its position in the market place. That abuse would lead to a fundamental misallocation of resources. The reason for having a market place is to determine where the best utilisation of resources can be obtained in everybody's interest. By and large, that is how we benefit.
I have argued that a monopoly as dominant as British Telecom should be broken down into regional companies. There was virtually no discussion of that in Committee. It is a respectable argument and should be given some credence or airing in this House. When such a considerable monopoly exists, the fear is that it may use its dominant market position to act covertly, or not so covertly, against the general good. I do not think that Oftel is as powerful as Ministers would argue. The powers of the dominant supplier may be used to undermine and distort the market, or lead to the misallocation of resources. Why have hon. Members not examined more closely in open debate the
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question of breaking down the monopoly into operating companies and releasing shares in those companies? I have considered that. In conversations with my ministerial friends and in interventions in Committee, Ministers have responded, "Do you not realise that the accounting systems currently in operation in British Telecom are inadequate and it cannot do that?" Therefore, the opportunity to break down the monopoly into regional companies is restricted. If it is imperative to sell BT quickly, we lose the opportunity to break it down into operating companies. But if the argument to sell as a whole is examined, is it as convincing as it sounds? The Government are delaying the sale of British Telecom until after the next election. That has been implicit in everything they have done and has been openly stated. The electorate will, rightly, have an opportunity to make a judgment.
As to the accounting procedures, is it not a remarkable indictment that all Governments have tolerated an accounting procedure or system that cannot identify whether or not the operation loses money in clearly defined areas, whether a customer or a consumer is paying a fair or reasonable price, or whether the company is allocating its resources in a responsible and reasonable way? Apparently, none of those things could be carried out. The Government have injected an accounting procedure and are now injecting accountants. The Government will be able to break down the monopoly into various operating companies which will not of themselves have a dominant market position and will not easily frustrate the introduction of new licensees and their success in the market.
It is important to realise that once British Telecom has been sold off after the Conservative party's success at the next election, the Government will be virtually denying themselves the opportunity of subsequently breaking it down.
The United States has been referred to frequently in discussions on the Bill. The Bell Telephone Corporation was the dominant market company in the United States, and it was found necessary to break it down into operating companies. In that way, it was deemed that the market and the interests of the consumer would best be served. Britain has virtually rejected that course of action because the imperative to sell as fast as possible is more important than the shape of our telecommunications industry in the future.
Yesterday, the Minister said that it was not the Government's intention in the forseeable future to license anything more in this field than the additional radiotelephone networks. Does that not diminish the very argument that has been advanced that liberalisation is going apace and that the consumer and the potential operator will be protected by competitive market forces? As it stands, that is not a reality either now or in the foreseeable future. Competition means that there is choice, and access to different competing operating companies. We shall not have that choice. Yesterday, the Minister said that he did not foresee introducing competition. Therefore, are we not falling into the very trap that I feared from the beginning, of falling between two stools? We shall have a dominant force in the market that is able covertly, or otherwise, to distort the market place to ensure that competition is controlled, regulated or under its surveillance.
In addition, we are doing something I believe to be terribly un-Conservative in that we are husbanding into life a competitor— Mercury — and ensuring in turn that it

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will not be subject to additional competition. That is a not very Conservative philosophy and gives me cause for great anxiety. It is important that we should move towards competition. I want the Department to push on that front and to follow through. I do not want competition to be limited in the way that my hon. Friend the Minister has said. The Minister then turned on me and said that I did not realise how much he had done. It is extraordinarily contradictory to argue that we are forcibly liberalising and then to say, in response to the hon. Member for Newcastle-under-Lyme (Mr. Golding) that we shall not license anything more than BT, Mercury, Hull and two radio telephone networks in the foreseeable future and that the hon. Gentleman should not worry about it. It is contradictory to say that we should first ensure that they survive and that hon. Members should remember that BT is in difficulty and earns only £1 billion per annum at present on revenues of about £5 billion. That is a return on sales of about 20 per cent. and is no small sum. BT is a tremendously dominant monopoly. It is the nearest thing that we have to a dominant monopoly that can be transferred to private interests. If we do that, it is important that it should either be strenuously regulated in the interim or that competition should be grasped as quickly as possible. The Government are in danger of falling between two stools. It is not sufficient to tell the House that there will be only one competitor, meaning Mercury, and a couple of radio telephone companies. That is not competition and does not represent any great move towards it.
It is not sufficient to say, "Do not visit upon me the sins of the inadequacies of all our past accounting systems." It is insufficient to say that in two years we have moved forward faster than in the previous 50 years. That is no great thing. The lessons of competition and of free enterprise and of their implications for the allocation of resources and the generation of wealth are well understood by most hon. Members, even, I hope, by the hon. Member for Preston, South (Mr. Thorne), who has spoken so trenchantly on behalf of Socialism in the past century. Even he has grasped some of the concepts involved. That is why I witnessed a great affront last night when the Under-Secretary of State, my hon. Friend the Member for Coventry, South-West (Mr. Butcher) discounted the implications of a dominant monopoly not performing on its licence, and so doing great commercial damage to small or large interests while being unable to be sued in the courts for redress.
I urge that principle on the House and on the other place for consideration. I have tried to outline the reasons for my anxieties and the central weakness in the strategy of the present ministerial team. During consideration of the Bill I have urged amendments on the Government. The spirit of some of them have been taken, and I am grateful for that. Some have been rejected, perhaps rightly so. However, I am not sure that the importance of moving towards genuine competition has been understood. I reiterate that when the Minister limits competition, arguing that that in itself is a force for change, it is not a happy state of affairs. I hope that my ministerial colleagues will give that point consideration between now and when the Bill returns to the House. However, in the absence of those changes I shall bide my time and, for the moment, abstain.
Mr. Deputy Speaker (Mr. Paul Dean): Before I call the next hon. Member it might be helpful if I informed the House that the Front Bench speeches are expected to begin at about 9.30 pm. A number of Members still wish to speak, so short speeches would be helpful.
8.45 pm
Mr. Dafydd Wigley: I shall be brief. The contribution of the hon. Member for Aldridge-Brownhills (Mr. Shepherd) has revealed the effect of rushing legislation like this through the House. Members on the Government Benches now realise that there is an essential dichotomy in what we are discussing and that it has not been properly resolved. The hon. Member and several other hon. Members on the Government side contributed to the argument in Committee on several aspects of this, no one more forcefully than he. Nevertheless, we have a Bill which provides for changing from a public to a private monopoly—or possibly a private duopoly, with one and a half companies or whatever.
The benefits that are supposed to come from competition are unlikely to come for most areas. Certainly they will not come for areas such as mine. We shall lose the element of service which has been so essential in the telecommunications network in rural areas such as the one I represent and we certainly will not get any benefit that may come from the concept of competition, because there will not be competition in an area like mine. It is an area that probably will put cost rather than profit on to the network.
There are serious misgivings even at this stage among those who are close to this industry, both those who are working in it and those who represent in local authorities and other bodies the opinions of the consumers and the community. There is a feeling that rural areas—and possibly inner city areas where there may be serious oncosts because of vandalism to telephone kiosks, and of digging up the roads—will not be so attractive with the cut-throat competition which may result from this Bill. We may find that the service that has been built up over the years will be eroded. I do not think that the points put forward on this have been satisfactorily answered even by the introduction of new clause 1 yesterday.
I say in passing that it is unsatisfactory that a new clause such as this should come forward without an opportunity properly to debate the amendments to it because of the stage at which it was introduced. Having had many hours in Committee upstairs, we would have hoped that at the very least we could have had an opportunity to go into this properly and coherently on Report.
Responding to the point made by the hon. Member for Leominster (Mr. Temple-Morris) a moment ago, I too believe that there are lessons to be learnt from the Committee stage of this Bill. Although having structured debates in Committee may restrict some of the freedom of opposition, it may be in the interest of getting better legislation overall that we should look at the way in which we handle this sort of Bill in Committee. Provided there is flexibility to take up new points not previously raised in Committee in any structured timetable, there are strong arguments in favour of having a more rational approach to the Committee stage than we have seen in the past.
The lesson that I have learnt is that I should never, on introducing an amendment, allow another hon. Member to move it, particularly if he intends to take 11½ hours. However eloquent the moving of the amendment may have

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been, I found it something of a chore to sit for 111/2 hours listening to the moving of my own amendment. I learnt a lesson the hard way.
Mr. Golding: Will the hon. Gentleman accept that I moved the amendment as a probing amendment so that the hon. Gentleman might have his composure restored?
Mr. Wigley: Yes. I was grateful to the hon. Member at the time, but in accepting his kind invitation to move the amendment I did not appreciate everything that it entailed.
The Minister, in opening the debate earlier this evening, said that this was not a privatisation measure but was giving greater public involvement in the telecommunications industry. No stretch of the imagination can lead us to accept that as a basic assumption behind the Bill. A very small part will be played by the employees in controlling the company even if they take up shares. I intervened earlier to underline the reality that employees will not be in anything like a dominant position as shareholders. If I thought that the employees could practically get to a position of holding a majority of the shares, I would think twice about that because I believe that there are certain attractions in going in that direction. In this sort of industry, however, with the sort of share capital we are talking about and with the practicalities of employees taking up any significant shareholding, all the Minister is doing is painting a picture that appears superficially attractive but in practical terms will have very little impact. The reality is that those who control the new companies will be the managers. As the Minister said, the Bill gives greater freedom to managers and makes them less answerable. No doubt the managers will enjoy that, but whether that will give the service that we as a community expect has certainly not been proven either in Committee or on Report.
Finance is another unsatisfactory aspect. In Committee we discussed the fact that there is no mechanism for ensuring that there is an independant means to finance a service, if that is required. New clause 1 creates a greater obligation, in that, for example, the community council could take the telecommunications companies to court as was suggested yesterday. However, in practice we know that it cannot afford to do so.
It is no use saying that only 30 or 40 telephone kiosks have been removed in rural areas in the past couple of years. Two years ago there was a massive list of suggested closures. That those kiosks were not removed was no doubt because of the public uproar at the time. Many suspected that there was a holding back and that after the enactment of this Bill there would be proposals for closures. The Director General and the Minister will have to keep a close eye on how that develops in practice. We fear that there will be massive closures of telephone kiosks in rural areas.
Another fear that was not resolved in Committee is whether there will be discrimination between the charges that are made in practice to certain categories of consumers. We have fears that the cost of installing telephones for some consumers in rural areas will be high and will be another charge on the rural community. Nothing has put our mind at rest on that.
The Bill will go forward from the House to another place. We have seen from other Bills in this Parliament that the other place plays a greater role in reforming
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legislation than does this House. There are many parts of the Bill that the other place should consider in detail. It should scrutinise what has been said here and look particularly at the new clauses with a view to strengthening the Bill. I hope that when the Bill returns to this House it will be a much better Bill than that which is leaving us now, despite the fact that no Bill along these lines will be a service to the people I represent.
8.52 pm
Mr. Penhaligon: We are in the midst of a remarkable parliamentary occasion. In one hour and eight minutes one suspects that the Bill will obtain a clear majority on its Third Reading. I recognise, as the Minister said earlier, that this is a massive and important Bill and is probably the biggest denationalisation or privatisation measure—call it what one will—in the annals of Parliament
The Bill was guillotined in Committee after 168 hours of debate. Significant portions of the Bill have not been discussed anywhere. I suppose that I have had as many letters about citizens band radio provisions as about anything else yet I could discover only a few column inches in the Official Report on that subject.
We are one hour and seven minutes from the Bill becoming an Act and we have the best attended House that we have had all day, with approximately 20 hon. Members present. It is a most peculiar way to draw up good legislation. So much time is spent in Committee on so little and yet a lot of time is given on the Floor of the House when, in general, hon. Members—I am not having a go at anybody—do not feel that there is any useful contribution that they can make.
My party supported the British Telecommunications Act 1981—or the Mercury Bill, as it has been called often during tonight's debate. That decision has been justified by events. There has been an improvement because of competition. We thought that Act would lead to real competition in specific areas of this complex industry. I am pleased that we supported that Act and I am even more pleased at the undoubted effects it has had. The prime reason why my party supported that Act was that we saw it as a practical way to reduce a monopoly. Monopolies are one of the root causes of some of our economic difficulties and are a general enemy of the people.
I listened carefully to the Minister's reasons for supporting the Bill. Most of them were reasons for supporting the previous legislation rather than this Bill. The new corporation that we are on the verge of setting up will be, to all intents and purposes, indistinguishable, for most of my constituents, from the monopoly they now have to deal with. I do not see that there is any substantial difference or advantage in a monopoly operated by private shareholders as opposed to one run by the State. In the former case one could make a complaint in the House and in the latter case one may get the Director General to overcome an unacceptable practice, but the differences between the two are only marginal.
The hon. Member for Caernarvon (Mr. Wigley) has done great battle for rural areas in Committee; he has been assisted by Conservative Members, whom I thank. They made some progress. It is easy to get carried away with the progress that has been made. I suspect that Members

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spent so much time in Committee that, having made a little progress on one thing, they convinced themselves that they had made much progress to justify their great labour.
I read part of the proceedings, and saw the constant claim by British Telecom that kiosks cost £2,000 a year to maintain. That may be a national average figure, but to argue that kiosks in remote parts of my constituency cost £2,000 a year to maintain is a fantasy of the first order. They are painted about once a decade and the money is taken out of them once a quarter. That accounts for almost the total expenditure on them — rightly so. They are remote and people do not destroy them or break them up. Some kiosks in my constituency are regarded by local people as their responsibility. They sweep them out in the morning and remove the cobwebs, the snails and the other things that find such kiosks attractive. It is preposterous that the figure of £2,000 a year for maintenance should be trotted out constantly for these kiosks.
In my reading of the Committee proceedings I could not discover the answer to a question which I put on Second Reading: if a telephone installation is destroyed in a storm, who will pay for it to be repaired? It was a simple question to ask on Second Reading, yet with just about an hour to go on Third Reading I still have not got a clear answer as to whether it will be the general responsibility of the new company or whether the company may send the bill to one of my remote farmers for the repair of his one-off installation.
The Bill has been introduced more because of party dogma than advantage for the people. It is yet another saga in the pathetic parliamentary nationalisation and denationalisation roundabout to which we are all subjected. Already the Conservative and Labour parties have reduced the British Steel Corporation to its present sorry state. Sadly we may here be witnessing the first round of reducing British Telecom to the same condition. If the Bill heralds two decades of nationalising and denationalising this great industry, which is vital and important to everyone in the nation, hon. Members will have spent many hours working against the interests of their constituencies.
My party will vote against Third Reading because we are in favour of reducing monopoly but we do not see that this Bill makes any useful contribution to that worthy cause.
8.59 pm
Mr. Marlow: Mr. Deputy Speaker, I shall be brief, I trust. I have supported the Bill. The one thing that I believe has helped the Bill to reach the stage that it has tonight with as much good will as it has had, and with such little truculence and bad-tempered opposition, has been the way that my hon. Friend the Minister has brought the Bill before the House, has dealt with the Bill and dealt with queries and his constant courtesy to everyone in Committee and within the House as the Bill has proceeded. [Interruption.] It may well be his job. Other people had had similar jobs but they have done it with nothing like the same degree of effect, restraint, compassion, thought and courtesy that my hon. Friend has put into the Bill.
We have just heard the Liberal party spokesman, the hon. Member for Truro (Mr. Penhaligon) talking about the Bill. He does not want British Telecom to be
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denationalised. No doubt when it is denationalised he will not want to nationalise it again. He does not seem to have any proposal to do anything about anything, just to criticise the objectives, procedures and activities of everyone else. He has nothing positive to put forward himself, purely criticism of others.
My hon. Friend made a point about the Liberals when he opened the debate. The problem with the Liberal party is this great paradox—why was not the Liberal party on the Bill? I will tell the House why not—because it knew that it was going to be hard work and it knew that it would be a long Bill. The paradox of the Liberal party is that it spends all its time getting here, rushing around looking for by-elections to fight, but when members of the Liberal party get here they are not the slightest bit interested in being here. That is why they did not want to participate in this Bill.
I am a supporter of the Bill. I appreciate the difficulties that my hon. Friend has had. We are breaking new ground and we are moving forward with speed. We are going into new and uncharted territory. It is a very difficult thing for a Government to do. I think that the Government have done the best they can in very difficult circumstances. The reason that the Bill is important—as my hon. Friend says it is the most important bit of legislation in this session—is that since 1945 large chunks of British life and industry have been taken away from the private sector and the people and put under public bureaucracy.
Much of our industry and many of our people now work within the public sector. Other people work within the private sector. One part of our commercial and industrial life is responsive to the needs of the public and the market and is efficient, profitable and flexible, whereas a whole raft of other activities suffers from bureaucracy, lack of competition and lack of commercial discipline. One of the saddest effects of this is that for those who work in the public sector, although they may be forced to work in a relatively inefficient way and although at the moment there may be more people actually doing work than need be there to do the work, it is a very unsatisfactory working environment in which people have committed their lives.
The right hon. Member for Salford, West (Mr. Orme) has said that his fear is that if the Bill becomes law, which it will I can assure him, it will have a devastating effect upon jobs. I think that the opposite is the case. In fact, I am sure that the opposite is the case. As the right hon. Member for Salford, West knows, we are moving into new frontiers of technology. There will be many new opportunities within telecommunications, many new products and many new areas of activity which can benefit the whole nation and everyone that lives in it.
We had a structure. I think that it was the wrong structure. Even if it were the right structure, as we move forward we shall have new structure. That is what the Government and my hon. Friend are putting before the nation. If we have, as we are to, the right new structure by and large, I appreciate that some things will not be right the first time and there will have to be modifications. If, by and large, we are to have the right structure then within that right structure, the market and activity will develop, new jobs will come into being, new companies will come into being, new products will come into being and new companies will manufacture and build those new products. I am afraid that the right hon. Member for Salford, West is being pessimistic. He is wrong. By following the Bill

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through, we shall not destroy jobs, but in the event we shall create jobs, not hundreds of jobs, not thousands of jobs but tens and perhaps hundreds of thousands of jobs.
Mr. Penhaligon: Hundreds of thousands of jobs?
Mr. Marlow: Yes. Hundreds of thousands of jobs.
The right hon. Member for Salford, West was crying about the effects on the manufacturers and the suppliers of the industry. Recently Conservative Members and an Opposition Member spoke to the suppliers of the industry. They want the Bill to go forward. They want this liberalisation to come into being because they believe that that way there will be more opportunities for the industry and for the manufacturers. What they are concerned about is other countries, where they do not have this liberalisation. They would like to see that liberalisation go forward there. If we go forward in this direction, we shall have the power and the ability to force our competing countries, particularly within the Common Market, to move in the same direction. We shall be in the forefront. We shall be there first. Our manufacturers will have a large, satisfactory and successful home market. Having got that, they will be the first and foremost to break into the market of our competitors. That is what they want. That is what we want. It is one of the most important things behind the Bill. That is why I support it.
9.6 pm
Mr. Stan Thorne: I am sorry that the hon. Member for Leominster (Mr. Temple-Morris) is not with us. He probably needs some refreshment. He referred to making British Telecom better. He did not discuss—in Committee there was little discussion of this—the real quality of service provided by British Telecom. There were no major criticisms and few minor ones by the Government of BT as it stands. They did not show that there was anything wrong with BT. Some of the arguments by my right hon. and hon. Friends showed that a great deal was right with BT. What perturbed us on Second Reading and disturbs us now is whether, by creating the new organisation that will emerge if the Bill becomes an Act, we shall be able to say in ten years, for example, that we have a service that is as valuable as the present service. I fear that we shall be unable to report the same quality of service as is apparent from a close examination of BT.
The major discussions in Committee and during our debates yesterday and today, particularly by Conservative Members, have been about competition, the holy cow of the Tory party. There is nothing new about that. "Profitable enterprise" is a phrase commonly used by Conservative Members. Surplus value in manufacturing industry is produced by the workers and it is taken over by private shareholders. That is how they obtain their profits.
I was intrigued by the arguments in Committee by the hon. Member for Aldridge-Brownhills (Mr. Shepherd). During his 22-minute contribution on Third Reading, he talked about abusing the position in the market place, implying that at present BT was abusing its position in telecommunications. At no time did he reveal that it is the multinational corporations, not public enterprise, that abuse their position in the market place today.
As a matter of fact the hon. Gentleman avoided a question that I and other hon. Members have asked. His argument tonight shows why he failed to reply to it. He
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chastised his own Minister for ensuring in the Bill that, in the short run, there will be only one major competitor to British Telecom. Clearly, the hon. Gentleman is dissatisfied with that. He wants a few more competitors in the industry, but he failed to tell us how many more. What would he consider an ideal number to achieve the so-called fair competition to which Conservative Members referred ad nauseam in Committee?
Mr. Frank Hooley: In how many countries in Western Europe does the type of competition in telecommunications, about which the hon. Member for Aldridge-Brownhills (Mr. Shepherd) babbles, exist?
Mr. Thorne: I am glad that my hon. Friend has made that point. The hon. Member for Aldridge-Brownhills has an attractive personality but he is politically naive. It has been my experience, and I am sure that of other Labour Members, that what we have seen and will continue to see in Britain, Germany, France, the United States, and in most major capitalist countries is a continuous process of capital moving into fewer and fewer hands. In some ways the hon. Member for Aldridge-Brownhills wishes to turn the clock back. He wants to do away with this concentration of capital and see companies springing up in the industry. But the telecommunications business needs not £200,000 or £300,000, but £200 million or £300 million even to make an impact. The hon. Gentleman's argument is absurd. The notion of private profit is alien to the objects of the Labour party.
I do not suggest that profit is not necessary. Obviously, manufacturing industry needs to make a profit to pay for health services, housing, education and so on, but we do not need private profit, which will simply create more investment abroad in pursuit of further profits, speculation, larger mansions for the wealthy and more purchases of Rolls-Royces. The Labour party is not in that business. We are not interested in the development of privilege at the expense of a well-organised, efficient and progressive telecommunications service. For that reason, Opposition Members will vote against Third Reading.
9.13 pm
Mr. Gerry Neale: I congratulate the hon. Member for Preston, South (Mr. Thorne) on his assiduous attention to the Bill in Committee. He advertised his political leanings, if in no other way, by the colour of his shirt which he displayed in Committee. As the hon. Gentleman has referred often enough to competition, it is interesting that competition in the shirt market was discussed in Committee. I see that the hon. Member for Darlington (Mr. O'Brien) is in the Chamber. I hope that he will not take offence at the comment that it causes great disappointment on the Conservative Benches to see him here. We would have much preferred to see someone sitting on the Conservative Benches. Nevertheless, we welcome the hon. Gentleman's presence.
I wish to be associated with remarks made by various Conservative Members about the Opposition Front Bench spokesmen. The right hon. Member for Salford, West (Mr. Orme) conducted their case clearly and with considerable courtesy. He allowed a number of interventions from Conservative Members. I understand that one of my hon. Friends earlier suggested that the right hon. Gentleman was not often present in Committee. I know that for a great deal of time he was a member of

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another Committee. Despite that, he showed a rather daunting grasp of the Bill which Conservative Members had to counter.
Comments have been made about the limited awareness of the need for competition in BT's activities. It has been said that a certain lack of awareness has been displayed by my hon. Friends the Minister and the Under-Secretary. I have been involved in the industry for some time. I have discussed the implications of the legislation with my hon. Friends, who have displayed considerable will about increasing the amount of competition.
My hon. Friends have introduced a whole range of proposals which some have sought to suggest do not amount to much. However, in time they will mean that a great deal of competition will be brought into the market place. My hon. Friend the Member for Aldridge-Brownhills (Mr. Shepherd) deployed extremely well his argument on the philosophy of competition, as he always does. However, he must consider the criticism that, while he may be strong and lucid about philosophical matters, there is a need to pay considerable attention to the practicalities involved. Such is the magnitude of BT, we cannot simply clear the slate and start all over again. That is impossible. Considerable problems are involved in transition in trying to arrive at a statutory framework that will make greater competition possible.
The right hon. Member for Salford, West mentioned accountability. It was obvious in Committee that we stood little chance of convincing him that his argument was wrong. Nevertheless, he should seek to understand our case, although whether he accepts it is for him to decide. The belief that drives us towards producing more competition is that the majority of people in Britain do not feel that they have a share in such organisations as BT. They do not look at their telephone instrument or the switchboard in an office and feel that they have a share in BT. Customers do not feel that BT is accountable to them, and nor do the taxpayers. The hon. Member for Newcastle-under-Lyme (Mr. Golding) may dispute this, but there is evidence among BT's employees that they do not think that BT is accountable to them either.
What drives Conservative Members on to introducing greater competition is the belief that if we make such organisations accountable to the customer, who will make a decision as a result of good sense, wisdom and in terms of his pocket, we will have a much more responsive organisation. Moreover, the employees will be much more aware of that necessary accountability. That is why my hon. Friends the Ministers and my right hon. Friend the Secretary of State have introduced the Bill and taken it through its various stages and changed it in the light of additional evidence. They have been willing to be flexible. Although I have some apprehensions about the Bill, I give it my full support. It will bring far greater choice to the market place for the consumer.
9.20 pm
Mr. John Grant: I preface my speech by agreeing with the hon. Member for Leominster (Mr. Temple-Morris), not for the first time, about the urgent need for a proper timetabling procedure on major Bills such as this.
Despite the long hours that have been spent in Committee and the many columns of Hansard that have been filled, I am unable to move on Third Reading from
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the stance that I adopted on Second Reading. The Government made some concessions at the margins in Committee, not least because they had one or two troublesome Back Benchers. We all look forward to hearing the Minister's reply to the scathing attack made by the hon. Member for Aldridge-Brownhills (Mr. Shepherd). His speech was a strong indictment, although I do not share his approach.
There have been some minor improvements. Clause 3 is an example. I am not sure that those improvements were cosmetic, as the hon. Member for Newcastle-under-Lyme (Mr. Golding) suggested, but they were not much more than marginal.
Two major criticisms remain. The first is the uncertainty and continuing confusion that the Bill will needlessly cause in advance of a general election. The Government have admitted that they do not have a mandate for this sweeping ideologically-based measure. The Minister has taken every opportunity to deride the Social Democratic-Liberal alliance. I am both amused and flattered by his constant attention. Perhaps it shows that he recognises that there are no safe Conservative seats, especially in inner London. Perhaps even Conservative seats in the stockbroker belt, to which I understand he has now departed, are not safe.
The second major criticism is the haste with which the Bill was forced upon us and the consequent extraordinary muddle which dogged us in Committee. There is also the broken promise about the introduction of the licence and the problem about the mid-term intervention of the Littlechild report. There have been many problems of that type. That is not the proper way in which to introduce major legislation of this type. The Minister said that it is the most important legislation in this Session. What has happened is not the way in which to introduce such legislation, nor is it the right way in which to treat the House.
Everything that has happened since Second Reading serves only to underline the anxieties that I and other hon. Members have expressed. Everyone agrees that the licence was all-important. I shall quote from the latest BT report on the Bill. It says:
"although the main points of the BT licence have been published, it is clear that it will take some time and considerable discussion between BT and DoI to fill out the provisions within this, the first licence of its kind and a document that will last 25 years".
The licence is central to the Bill, crucial to the future of British Telecom and, consequently, to the future of the entire telecommunications industry, about which the Minister tells us he is so concerned, and crucial to the granting of subsequent licences arising from the Bill. Yet the House is denied the details of the licence. The hon. Member for Leominster suggested that the reason may be that British Telecom used delaying tactics. If that is true, where is the clout—the Minister likes that word and has used it many times—that one would expect from Ministers in his position? Why has he not sorted out the licence, and why has the House not had the details that he promised us?
Many other matters, including price restraint, access charges and cross-subsidisation, remain vague. Despite the price restraint formula, residential customers will probably find that their bills increase more rapidly than those of business customers. It seems that the Government still intend to get the regulatory body in place before the next general election—that will depend on the timing of the election, and, as the Minister has now sorted out his

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seat, there is no need to delay further. If it is delayed, it would be reasonable to put the Bill on ice pending the outcome of the election. It would not be right to introduce Oftel now, because it is intended to operate in the competitive environment that the Government, at least in theory, expect to create. As full privatisation will occur only if the Government are returned, it would be sensible and proper that no part of the Bill be implemented ahead of that time.
The Bill was born out of an ideological insistence that privatisation is desirable in itself. The legislation was the showpiece. Ministers in the Department of Industry have told us that they propose to privatise the steel industry if they have the opportunity. With Mr. MacGregor at the National Coal Board, what is left of that industry may be turned over to private enterprise. The Minister is thinking hard, and I am sure that he will reach that conclusion. Under this dogma-ridden Government, anything is possible. The Bill, at such a volatile and uncertain political period, is a grave mistake. It can only add to industrial uncertainty at a time when British Telecom is, on its own admission, having to adapt at an unprecedented rate to changes, and needs, as the document states,
"a sensible period of time to digest these massive changes affecting its organisation and its staff."
The document refers to changes already in the pipeline and not to those to come.
The Government have said too little throughout the proceedings to allay the anxieties of British Telecom staff. The Minister described this as a liberating Bill and he no doubt sees himself as a great liberator, although most Ministers at the Department of Industry would qualify more as great liquidators, because that is what they have done for the past three and a half years.
The Bill is ill-constructed and ill-conceived. The practicalities, if not the principles, have certainly earned the severe criticism of Government Back Benchers, but the Social Democratic party believes that the principle is wrong. There is no convincing economic and industrial case for privatisation. I made it clear that if, after the general election, the Bill is to be fully implemented, it must be on the basis of the Conservative party's vote alone. My right hon. and hon. Friends and I will vote against Third Reading tonight.
9.30 pm
Mr. Henderson: I have decided in the past few minutes to telescope my remarks considerably.
The Bill started as a good one, and has become a better one. As a charter for consumers it is a model for possible future measures. Not least important in the liberalisation measures—in addition to the reduction in waiting lists, which has happened in my constituency since the introduction of the British Telecommunications Act—is the scope for innovation and the opportunity for new jobs in new kinds of industry and exports.
The other important aspect of the Bill is the opportunity presented by the denationalisation provisions to free BT from public sector borrowing requirement restraints and to ensure that in future it will have enough capital to develop its projects in the interest of consumers without loading up the telephone accounts to pay for future investments.
The Bill will give an assurance of fair play through the mechanism of the Director General of Oftel. For these brief reasons, I hope that we shall move the Bill on to the other place, and that a general election will soon follow.
9.31 pm
Mr. Tom Clarke: On a point of order, Mr. Deputy Speaker. May I draw your attention to the views of a large number of people in Scotland who voted for the Labour party in the general election, whose representatives had a good attendance record throughout the Committee, but, unfortunately, whose views have not been expressed in the debate tonight? I ask the Front Bench speakers to pay due regard to those views during the winding-up speeches.
Mr. Deputy Speaker (Mr. Paul Dean): I understand the hon. Member's disappointment and admire the way in which he has given a hint to his own Front Bench.
9.32 pm
Dr. John Cunningham: My hon. Friend the Member for Coatbridge and Airdrie (Mr. Clarke) was an assiduous and effective member of the Committee. Like him, I regret that he has not been able to intervene in the Third Reading debate.
We have had a long and thorough consideration of a major Bill. About the only thing I agreed with the Minister about was that this is the most important Bill of the Session. That at least we can agree about, but the rest of his remarks fell on rather stony ground.
I thank the hon. Members for Leominster (Mr. Temple-Morris) and for Cornwall, North (Mr. Neale) for their kind references to my right hon. Friend the Member for Salford, West (Mr. Orme) and myself. Having listened to those comments, I was somewhat taken aback by the hon. Member for Aldridge-Brownhills (Mr. Shepherd), who perhaps overlooked the fact that I was also a member of the shipbuilding privatisation Committee and spent a little time helping my hon. Friend the Member for Darlington (Mr. O'Brien), whom I am delighted to see in the Chamber, successfully contest a by-election. I can tell the hon. Member for Aldridge-Brownhills and the House that I make no apology to the Labour party or the trade unions for being absent for that purpose. I look forward to the effective contributions that my hon. Friend the Member for Darlington will be making as the representative of that town.
It is rather sad that, after 70 years of public telephone operation, the Bill will proceed through Third Reading. The monopoly is coming to an end, and that is not only unnecessary but is likely to damage the community interest and individual interests. The record shows that it is unnecessary. What the Minister and some hon. Members have said about the record of public telephone operation is not borne out by a close examination.
The Bill is sad also because it poses a threat to services and jobs. It is damaging because its result will be the creation of a private monopoly. As the hon. Member for Aldridge-Brownhills said, all that is happening is that a public monopoly is becoming, in effect, a private monopoly. It is regrettable, too, because it will result in unplanned, unco-ordinated investment and it will put an end to any overall national strategy for telecommunications, because there will be no guarantee on prices, as the last two price reviews, which penalised domestic consumers, showed. There will be no guarantee of choice; most people will have no choice. There will be no guarantee of improved or better services. There will he no guarantee of real or effective competition.

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If we compare the Government's assertions with what has happened in the United States of America following liberalisation, we see that 80 per cent. of the telephone network is still owned and controlled by AT and T, the trunk lines are all controlled by AT and T, and all the local networks have one operator, with no competition and no choice. That is the reality of liberalisation in the United States, and that is likely to be the outcome in the United Kingdom also, following the passage of this Bill.
Against that background, I was somewhat surprised to hear the hon. Member for Truro (Mr. Penhaligon) say that his party had supported earlier measures introduced by the Government, because their direct results were to increase costs to subscribers and the threat to services in rural areas. That is what is happening, and that is likely to continue to happen. It ill behoves the Liberal party, which professes support for rural areas, to say anything in support of this Government's telecommunications measures.
British Telecom and its predecessors have a good record. As a publicly owned corporation, BT has not only improved services, operated profitably and increased the available services, but it has done so with little increase in the number of employees. It was the hon. Member for Northampton, North (Mr. Marlow), I think, who complained about productivity. The productivity record of British Telecom compares favourably with that of any private sector organisation. As a publicly owned corporation, it has been fully accountable to the community for its activities. The public have statutory rights through consumer watchdogs. I am not at all convinced that the Office of Telecommunications, which is almost certainly to be based in London, will be of any comfort to my constituents in Whitehaven, or to people in Scotland or south Wales, as a defender of their rights and of consumer choice.
At present the corporation is in the middle of a massive investment programme to expand and modernise the telecommunications network. That will be jeopardised, if not thrown into confusion. BT and its work force have accepted the need for change so as to provide the benefits of the latest services to their consumers and customers as a whole, not just—as is likely to be the case, because of the pressure of market forces and profits—to a select few.
When the Minister of State talked about real public ownership, I assume that he used the word "public" in the same context as Tories use it in terms of public schools. The public ownership that he has in mind is not evidenced by what has happened in the sale of other state assets under this Government. The emergence of private shareholders will almost certainly ensure that the corporation concentrates more and more on the profitable parts of its business, to the exclusion of real public interest.
The ending of BT's exclusive privilege will bring with it an end to the corporation's duty to provide a national service. The main adverse effects of privatisation will fall directly on residential consumers. There is already evidence in the pricing restructuring to support that argument. We face a threat to public accountability and almost certainly to the availability of information to the public.
Mr. Kenneth Baker indicated dissent.
Dr. Cunningham: The Minister of State contests that assertion. Let us examine the Government's record during
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the passage of the Bill. The Minister promised the House a model licence. He failed to produce it. Littlechild was produced at short notice during the passage of the Bill. The Government have produced no articles of association or access fee details. Promises were made to the Committee and the House, but the Government failed to deliver. The Government also promised, but failed to deliver, a White Paper on cable.
Even during the passage of the Bill, the Minister's record in obtaining information for hon. Members has been abysmal. If that is the prospect we face when BT is in private control, it does not augur well for scrutiny, accountability and public control. We regard that prospect with some foreboding.
As for the arguments for competition, Mercury states publicly that it intends to cream the market. We all know that Mercury will not offer services in the remote rural areas and those inner city areas which are unlikely to produce much revenue or much chance of a quick profit. There will be very little real competition for most consumers. BT's finances will be placed in jeopardy. It will be left with the loss-making areas to support, and the old Tory approach to public services will be apparent. BT will be left with all the unattractive aspects of the business, and the private sector will move into those areas where money can be made, to the detriment of the national network of telecommunications and the public interest.
The Government's policy of selling off or privatisation has not even been a success. It has been a complete failure. Public assets have been ripped off not by the City of London but by the Government. In the 1960s and early 1970s, we used to complain about the unacceptable face of capitalism. This Government now represent the unacceptable face of capitalism. The Minister of State laughs, but the Government are interested in quick speculative gains. In the case of British Aerospace, the gain on the shares was 56·7 per cent. In the case of Cable and Wireless the gain was 150 per cent. The gain on Amersham International shares was 78·9 per cent., and on the shares of Associated British Ports 37·5 per cent. The sale of Britoil was a calamity. Britoil was a dead loss for the British taxpayer. The hon. Member for Hertfordshire, South-West (Mr. Page) laughs—
Mr. Kenneth Baker: The hon. Member for Whitehaven (Dr. Cunningham) cannot have it both ways.
Dr. Cunningham: Of course I can. Both ways, the taxpayer has lost. Offers have been either hopelessly oversubscribed or hopelessly undersubscribed. How can the taxpayer possibly gain from that? The speculative buyers of shares, not the taxpayer, have gained. That is also the likely outcome of the sale of British Telecom—a bigger sale than any yet proposed.
The Government have shied away from all the arguments about the threat to jobs. Despite their blandishments, however, behind their privatisation schemes—those that have already taken place as well as this one—there has been a substantial, continuing and in some cases massive programme of job losses. It has happened in British Aerospace and it is now happening in British Shipbuilders, another organisation being prepared for privatisation.
The Government have made no secret of their aim to reduce public sector jobs. The work force of British Airways has been reduced by 23,000, that of the National

275
Freight Company by almost 10,000, that of Rolls-Royce by 12,000 and there has been a fall of 8 per cent. at Cable and Wireless. The record shows that jobs will be lost in telecommunications as a result of the Bill. That was certainly the result of liberalisation in the United States.
We do not believe that the Government's dogma, their theories about market forces or the practice of this measure will benefit anyone. The effect will be the reverse. The telephone-using public will not benefit, nor will any national strategy for telecommunications emerge. The Bill will not only lead to higher prices: it will favour big business rather than the individual. The Government had no mandate to introduce the Bill or to carry through such a policy, and we do not believe that they will ever be given such a mandate.
9.46 pm
Mr. Butcher: Thanks have been expressed to various members of the Standing Committee which dealt with the Bill. Although my hon. Friend the Member for Plymouth, Drake (Miss Fookes) is not present, I record my thanks and, no doubt, the thanks of all members of the Committee for the great patience and stamina and the occasional sense of humour with which she chaired our proceedings. She certainly needed all those qualities. She needed stamina and patience because our proceedings contained every ingredient normally found in controversial memoirs. There was a clash of philosophy between the two major parties and there were clashes about the practicalities of the Bill. The views of the right hon. Member for Salford, West (Mr. Orme)—a root and branch Socialist and, as he reminded us, a clause 4 man—were tempered by those to the Left and to the Right of him. Occasionally, he was led by one to the right of him, but at all times he expressed his views with tenacity and occasional good humour.
The right hon. Member for Salford, West berated us today with the accusation that somehow we are moving away from the social and community obligations that existed when BT retained its exclusive privilege and that the Bill will weaken the rights of people in rural areas and the financial support of the 999 service and the emergency services generally. We did our best to reject and, I believe, succeeded in rejecting those accusations. In response to the comments of the right hon. Gentleman and other hon. Members, and especially those of my hon. Friend the Member for Leominster (Mr. Temple-Morris), we brought forward an amendment to clause 3 in the form of new clause 1.
We believe that that synthesised new clause defines the public interest. It defines the priorities that the Secretary of State and the Director General must bear in mind when exercising their various powers. The right hon. Member for Salford, West said that he believed in a national service for all. The Government also believe in a national service for all. The Government believe that during the Committee stage they had finely tuned and trailed before Members the mechanism by which those loss-making services can receive cross-subsidy.
Although the Government and my hon. Friend the Member for Aldridge—Brownhills (Mr. Shepherd) have differed tactically, there is no difference in our objectives. As to the loss-making services, the Government should place the onus of proof on BT to show that it makes a loss in those areas and to show how that loss can be coupled with requirements for cross-revenues via the access charge.
276
The right hon. Member for Salford, West gave clear advice by saying that he did not recommend that the employees of BT should purchase shares. That was rather a dog-in-the-manger attitude. My belief is that the membership of the POEU will buy shares and will take advantage of this offer, which will be a good bargain. The shares will be in one of the most dynamic sectors of the economy and will be valued by those who work: in the industry. Underlying the remarks of the right hon. Gentleman was a lack of faith. He expressed great fears as to the future of the suppliers of telecommunications equipment, those who may supply core equipment and apparatus. He also expressed fears as to the generality of this service and fears for employees and consumers. His observations concerned the equipment suppliers and their future. I say with some pride that Plessey has expanded into the United States of America and introduced new technology in the space section, that Ferranti has diversified into telecommunications with GTE, that RACAL has moved into cellular radio systems, that BT, Plessey and GEC have signed important agreements with Mitel to exploit CMOS technology, that Mitel has opened a new factory in Newport and that there are smaller companies, whose entry into this market the Government welcome, which are developing or have developed products to take advantage of the liberalised market.
This would not have happened without the radical change in the market structure brought about by the original British Telecommunications Act 1981 and reinforced by new clause 1.
My respect for my hon. Friend the Member for Aldridge-Brownhills is not diminished by his remarks this evening. I appreciate that he considers this matter as serious. The Government have tried to respond seriously to his observations in Committee. I bow to no one in my defence of basic freedoms in this country and the defence of those freedoms in commercial law. Having heard my hon. Friend speak on previous occasions may I say that I too am a fan of Thomas Hobbes. I have heard him quote "Leviathan" in the original language. I suspect that he would agree with me that, after Committee stage, the condition of man is a condition of war, of everyone against everyone. There have been times in Committee when that condition of war of everyone against everyone has not just been across the parties but between them.
The Government believe they have emerged with a better Bill. There has been reference to Professor Littlechild. Professor Littlechild was asked by the Department of Industry to make a report. His report: did not just float in during Committee stage. It was a deliberate act by Ministers in the Department of Industry who decided that they should put forward proposals for a regulatory mechanism by which the Government could check whether BT was earning super-normal profits, a mechanism by which its rate of return could be examined and by which the Government could temper the pattern of regulations through the introduction of competition.
I place on record my agreement with Littlechild's basic tenet that there is no substitute for competition. That is the most effective form of regulation. A strong statement has already been made on such basic matters as policy on the first instrument, resale, further liberalisation of maintenance and on the retail price index minus X formula. That is the way to proceed.
The hon. Member for Caernarvon (Mr. Wigley) has fought his corner and has become the blood brother of the

277
hon. Member for Newcastle-under-Lyme (Mr. Golding). They even moved each other's amendments. However, I must refer him to new clause 1, which surely meets many of the reservations expressed by both the hon. Gentlemen and my hon. Friends in Committee. The hon. Member for Newcastle-under-Lyme has brought new meaning to the expression "at the 11th hour". It used to denote a form of tension, but it now denotes a form of the most excruciating tedium. However, he stuck to his guns and paraded his 20th century mercantilism before the Committee and the House.
My hon. Friend the Member for Leominster deserves particular mention. I shall write to him on the point that he has raised and about the interim protection on call boxes. He, more than any other hon. Member, as our unofficial legal adviser in Committee, has done much to preserve rural interests. My hon. Friend the Member for Fife, East (Mr. Henderson) has looked after the Scottish aspect, even taking us into the fine detail of Scots, rather than Scottish, law. My hon. Friend the Member for Cornwall, North (Mr. Neale), who moves a pretty deft amendment himself, has also helped us considerably in our deliberations.
The hon. Member for Whitehaven (Dr. Cunningham) looked back over 70 years and indeed that phenomenon has characterised many of the contributions made by him and his hon. Friends. When the Bill is enacted, it will take us through the 1980s and into the 21st century. We believe that it will do so in the interests of BT, of consumers, of those who work for BT, and in the interests of those who will create additional jobs in the new markets that are now coming to the fore. However, it was essential that we should end that exclusive privilege. That was not the way to move into new trends and into the internationally competitive world of telecommunications.
I await with interest the casting of votes by SDP and Liberal Members in the Division. Hon. Members should note that in the Division at 5.30 pm on cable policy, 11 Liberal Members voted with the Government, while five Social Democrat Members conspicuously abstained. However, one Social Democrat, the right hon. Member for Greenock and Port Glasgow (Dr. Mabon) apparently found his way by mistake into the Opposition Lobby.
The right hon. Member for Salford, West was absolutely right. This subject will be an election issue. It will divide the House—such issues always have. However, I suspect that it will not divide the country in equal proportion and that the vast majority of our people will support the measure. They will look forward to price increases at less than the rate of inflation for the next five years. They will look forward to receiving the protection of the Director General of Fair Trading. They will have their protection with teeth. They will look forward to the new developments in telecommunications and to the new job opportunities that will be made possible by the Bill.
The Bill takes us into the year 2000. It will be good for jobs, good for the equipment suppliers, and will, above all, be good for the consumers of telecommunication services in the United Kingdom.
9.59 pm
Mr. Golding: That was one of the worst speeches that we have ever heard. The incompetence of the Under-Secretary of State in sitting down early has been equaled
278
only by the incompetence of the Minister and the Under-Secretary of State in Committee. This Bill is bad for the consumer, is disastrous for British manufacturing industry and—
It being Ten o'clock, MR. DEPUTY SPEAKER proceeded, pursuant to the Order [16 February] and the Resolution yesterday, to put forthwith the Question already proposed from the Chair.
Question put, That the Bill be now read the Third time:—
Mr. Michael Cocks(seated and covered): On a point of order, Mr. Deputy Speaker. The Opposition are not responsible for the incompetence of the Government Whips. My hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding) was still speaking when the clock reached 10 o'clock. I therefore submit that the Bill has been talked out.
Mr. Deputy Speaker (Mr. Paul Dean): The right hon. Gentleman is not correct. I am required by the terms of the guillotine motion to put the Question at 10 o'clock, and that is what I have done.
The House divided: Ayes 286, Noes 241.

Division No. 107]

[10 pm

AYES

Aitken, Jonathan

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

Alexander, Richard

Clark, Sir W. (Croydon S)

Alison, Rt Hon Michael

Clarke, Kenneth (Rushcliffe)

Ancram, Michael

Clegg, Sir Walter

Arnold, Tom

Cockeram, Eric

Aspinwall, Jack

Colvin, Michael

Atkins, Rt Hon H.(S'thorne)

Cope, John

Atkinson, David (B'm'th.E)

Cormack, Patrick

Baker, Kenneth(St.M'bone)

Corrie, John

Baker, Nicholas (N Dorset)

Costain, Sir Albert

Banks, Robert

Critchley, Julian

Beaumont-Dark, Anthony

Crouch, David

Bendall, Vivian

Dickens, Geoffrey

Benyon, Thomas (A'don)

Dorrell, Stephen

Benyon, W. (Buckingham)

Douglas-Hamilton, Lord J.

Berry, Hon Anthony

Dover, Denshore

Best, Keith

du Cann, Rt Hon Edward

Bevan, David Gilroy

Dunn, Robert (Dartford)

Biffen, Rt Hon John

Durant, Tony

Biggs-Davison, Sir John

Dykes, Hugh

Blackburn, John

Edwards, Rt Hon N. (P'broke)

Blaker, Peter

Emery, Sir Peter

Body, Richard

Eyre, Reginald

Bonsor, Sir Nicholas

Fairbairn, Nicholas

Bottomley, Peter (W'wich W)

Fairgrieve, Sir Russell

Bowden, Andrew

Faith, Mrs Sheila

Boyson, Dr Rhodes

Farr, John

Braine, Sir Bernard

Fell, Sir Anthony

Bright, Graham

Fenner, Mrs Peggy

Brinton, Tim

Finsberg, Geoffrey

Brittan, Rt. Hon. Leon

Fisher, Sir Nigel

Brooke, Hon Peter

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

Brotherton, Michael

Fletcher-Cooke, Sir Charles

Brown, Michael(Bhgg & Sc'n)

Forman, Nigel

Browne, John (Winchester)

Fox, Marcus

Bruce-Gardyne, John

Fraser, Rt Hon Sir Hugh

Bryan, Sir Paul

Fraser, Peter (South Angus)

Buchanan-Smith, Rt. Hon. A.

Fry, Peter

Buck, Antony

Gardiner, George (Reigate)

Budgen, Nick

Gardner, Sir Edward

Burden, Sir Frederick

Garel-Jones, Tristan

Butcher, John

Gilmour, Rt Hon Sir Ian

Carlisle, John (Luton West)

Glyn, Dr Alan

Carlisle, Kenneth (Lincoln)

Goodhart, Sir Philip

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

Goodhew, Sir Victor

Chalker, Mrs. Lynda

Goodlad, Alastair

Channon, Rt. Hon. Paul

Gorst, John

Chapman, Sydney

Gow, Ian

Churchill, W. S.

Gower, Sir Raymond

279

Grant, Sir Anthony

Mills, Sir Peter (West Devon)

Gray, Rt Hon Hamish

Miscampbell, Norman

Greenway, Harry

Mitchell, David (Basingstoke)

Grieve, Percy

Moate, Roger

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

Monro, Sir Hector

Griffiths, Peter (Portsm'th N)

Montgomery, Fergus

Grist, Ian

Moore, John

Grylls, Michael

Morris, M. (N'hampton S)

Gummer, John Selwyn

Morrison, Hon C. (Devizes)

Hamilton, Hon A.

Morrison, Hon P. (Chester)

Hamilton, Michael (Salisbury)

Mudd, David

Hampson, Dr Keith

Murphy, Christopher

Hannam,John

Myles, David

Haselhurst, Alan

Neale, Gerrard

Havers, Rt Hon Sir Michael

Needham, Richard

Hawkins, Sir Paul

Nelson, Anthony

Hawksley, Warren

Neubert, Michael

Hayhoe, Barney

Newton, Tony

Henderson, Barry

Normanton, Tom

Heseltine, Rt Hon Michael

Onslow, Cranley

Higgins, Rt Hon Terence L.

Oppenheim, Rt Hon Mrs S.

Hill, James

Osborn, John

Hogg, Hon Douglas (Gr'th'm)

Page, John (Harrow, West)

Holland, Philip (Carlton)

Page, Richard (SW Herts)

Hooson, Tom

Parkinson, Rt Hon Cecil

Hordern, Peter

Patten, Christopher (Bath)

Howe, Rt Hon Sir Geoffrey

Patten, John (Oxford)

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

Pattie, Geoffrey

Howell, Ralph (N Norfolk)

Pawsey, James

Hunt, David (Wirral)

Percival, Sir Ian

Hunt, John (Ravensbourne)

Peyton, Rt Hon John

Irvine, RtHon Bryant Godman

Pink, R. Bonner

Irving, Charles (Cheltenham)

Pollock, Alexander

Jenkin, Rt Hon Patrick

Porter, Barry

Jessel, Toby

Prentice, Rt Hon Reg

Jopling, Rt Hon Michael

Price, Sir David (Eastleigh)

Joseph, Rt Hon Sir Keith

Proctor, K. Harvey

Kaberry, Sir Donald

Raison, Rt Hon Timothy

Kellett-Bowman, Mrs Elaine

Rathbone, Tim

Kershaw, Sir Anthony

Rees-Davies, W. R.

Kimball, Sir Marcus

Renton, Tim

King, Rt Hon Tom

Rhodes James, Robert

Kitson, Sir Timothy

Rhys Williams, Sir Brandon

Knight, Mrs Jill

Ridley, Hon Nicholas

Knox, David

Ridsdale, Sir Julian

Lang, Ian

Rippon, Rt Hon Geoffrey

Langford-Holt, Sir John

Roberts, Wyn (Conway)

Latham, Michael

Rossi, Hugh

Lee, John

Rost, Peter

Le Marchant, Spencer

Royle, Sir Anthony

Lennox-Boyd, Hon Mark

Sainsbury, Hon Timothy

Lester, Jim (Beeston)

St. John-Stevas, Rt Hon N.

Lloyd, Ian (Havant & W loo)

Shaw, Giles (Pudsey)

Lloyd, Peter (Fareham)

Shaw, Sir Michael (Scarb')

Loveridge, John

Shelton, William (Streatham)

Luce, Richard

Shepherd, Colin (Hereford)

Lyell, Nicholas

Silvester, Fred

Macfarlane, Neil

Sims, Roger

MacGregor, John

Skeet, T. H. H.

MacKay, John (Argyll)

Smith, Tim (Beaconsfield)

Macmillan, Rt Hon M.

Speed, Keith

McNair-Wilson, M. (N'bury)

Speller, Tony

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

Spence, John

McQuarrie, Albert

Spicer, Jim (West Dorset)

Madel, David

Spicer, Michael (S Worcs)

Major, John

Sproat, Iain

Marland, Paul

Squire, Robin

Marlow, Antony

Stainton, Keith

Marshall, Michael (Arundel)

Stanbrook, Ivor

Marten, Rt Hon Neil

Stanley, John

Mates, Michael

Steen, Anthony

Maude, Rt Hon Sir Angus

Stevens, Martin

Mawby, Ray

Stewart, A.(E Renfrewshire)

Mawhinney, Dr Brian

Stewart, Ian (Hitchin)

Maxwell-Hyslop, Robin

Stokes, John

Mayhew, Patrick

Stradling Thomas, J.

Mellor, David

Tapsell, Peter

Meyer, Sir Anthony

Taylor, Teddy (S'end E)

Miller, Hal (B'grove)

Tebbit, Rt Hon Norman

Mills, Iain (Meriden)

Temple-Morris, Peter

280

Thomas, Rt Hon Peter

Walters, Dennis

Thompson, Donald

Ward, John

Thome, Neil (Ilford South)

Watson, John

Thornton, Malcolm

Wells, Bowen

Townend, John (Bridlington)

Wells, John (Maidstone)

Townsend, Cyril D, (B'heath)

Wheeler, John

van Straubenzee, Sir W.

Whitney, Raymond

Vaughan, Dr Gerard

Wickenden, Keith

Viggers, Peter

Williams, D.(Montgomery)

Waddington, David

Winterton, Nicholas

Waldegrave, Hon William

Young, Sir George (Acton)

Walker, Rt Hon P.(W'cester)

Younger, Rt Hon George

Walker, B. (Perth)

Walker-Smith, Rt Hon Sir D.

Tellers for the Ayes:

Wall, Sir Patrick

Mr. Carol Mather and

Waller, Gary

Mr. Robert Boscawen.

NOES

Abse, Leo

Dunwoody, Hon Mrs G.

Adams, Allen

Eadie, Alex

Allaun, Frank

Eastham, Ken

Alton, David

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

Anderson, Donald

Ellis, Tom (Wrexham)

Archer, Rt Hon Peter

English, Michael

Ashley, Rt Hon Jack

Evans, loan (Aberdare)

Atkinson, U.(H'gey,)

Evans, John (Newton)

Bagier, Gordon A.T.

Faulds, Andrew

Barnett, Guy (Greenwich)

Field, Frank

Barnett, Rt Hon Joel (H'wd)

Foot, Rt Hon Michael

Beith, A. J.

Ford, Ben

Benn, Rt Hon Tony

Forrester, John

Bennett, Andrew(St'kp't N)

Foster, Derek

Bidwell, Sydney

Foulkes, George

Booth, Rt Hon Albert

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

Boothroyd, Miss Betty

Freeson, Rt Hon Reginald

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

Garrett, John (Norwich S)

Bradley, Tom

Garrett, W. E. (Wallsend)

Bray, Dr Jeremy

George, Bruce

Brocklebank-Fowler, C.

Gilbert, Rt Hon Dr John

Brown, Hugh D. (Provan)

Ginsburg, David

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

Golding, John

Brown, Ronald W. (H'ckn'y S)

Gourlay, Harry

Brown, Ron (E'burgh, Leith)

Graham, Ted

Buchan, Norman

Grant, John (Islington C)

Callaghan, Rt Hon J.

Grimond, Rt Hon J.

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

Hamilton, James (Bothwell)

Campbell, Ian

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

Campbell-Savours, Dale

Hardy, Peter

Canavan, Dennis

Harrison, Rt Hon Walter

Cant, R. B.

Hart, Rt Hon Dame Judith

Carmichael, Neil

Hattersley, Rt Hon Roy

Carter-Jones, Lewis

Haynes, Frank

Cartwright, John

Healey, Rt Hon Denis

Clark, Dr David (S Shields)

Heffer, Eric S.

Clarke.Thomas(C'b'dgre, A'rie)

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

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

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

Coleman, Donald

Home Robertson, John

Conlan, Bernard

Homewood, William

Cook, Robin F.

Hooley, Frank

Cowans, Harry

Horam, John

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

Howell, Rt Hon D.

Crawshaw, Richard

Howells, Geraint

Crowther, Stan

Hoyle, Douglas

Cryer, Bob

Huckfield, Les

Cunningham, G. (Islington S)

Hudson Davies, Gwilym E.

Cunningham, Dr J. (W'h'n)

Hughes, Mark (Durham)

Dalyell, Tarn

Hughes, Robert (Aberdeen N)

Davidson, Arthur

Hughes, Roy (Newport)

Davies, Rt Hon Denzil (L'lli)

Hughes, Simon (Bermondsey)

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

Jay, Rt Hon Douglas

Deakins, Eric

John, Brynmor

Dean, Joseph (Leeds West)

Johnson, James (Hull West)

Dewar, Donald

Johnson, Walter (Derby S)

Dixon, Donald

Johnston, Russell (Inverness)

Dobson, Frank

Jones, Barry (East Flint)

Dormand, Jack

Kaufman, Rt Hon Gerald

Douglas, Dick

Kerr, Russell

Dubs, Alfred

Kilfedder, James A.

Duffy, A. E. P.

Kilroy-Silk, Robert

Dunnett, Jack

Lambie, David

281

Lamond, James

Rooker, J. W.

Leadbitter, Ted

Roper, John

Leighton, Ronald

Ross, Ernest (Dundee West)

Lestor, Miss Joan

Ross, Stephen (Isle of Wight)

Litherland, Robert

Rowlands, Ted

Lofthouse, Geoffrey

Sandelson, Neville

Lyon, Alexander (York)

Sever, John

Lyons, Edward (Bradf'd W)

Sheerman, Barry

Mabon, Rt Hon Dr J. Dickson

Shore, Rt Hon Peter

McCartney, Hugh

Silkin, Rt Hon J. (Deptford)

McDonald, Dr Oonagh

Silkin, Rt Hon S. C. (Dulwich)

McElhone, Mrs Helen

Silverman, Julius

McGuire, Michael (Ince)

Skinner, Dennis

McKay, Allen (Penistone)

Smith, Cyril (Rochdale)

McKelvey, William

Smith, Rt Hon J. (N Lanark)

MacKenzie, Rt Hon Gregor

Snape, Peter

McNamara, Kevin

Soley, Clive

McTaggart, Robert

Spearing, Nigel

McWilliam, John

Spellar, John Francis (B'ham)

Magee, Bryan

Spriggs, Leslie

Marks, Kenneth

Stallard, A. W.

Marshall, D(G'gow S'ton)

Steel, Rt Hon David

Marshall, Dr Edmund (Goole)

Stewart, Rt Hon D. (W Isles)

Martin, M(G'gow S'burn)

Stoddart, David

Mason, Rt Hon Roy

Stott, Roger

Maynard, Miss Joan

Strang, Gavin

Meacher, Michael

Straw, Jack

Mikardo, Ian

Summerskill, Hon Dr Shirley

Millan, Rt Hon Bruce

Thomas, Dafydd (Merioneth)

Mitchell, R. C. (Soton Itchen)

Thomas, Jeffrey (Abertillery)

Morris, Rt Hon A. (W'shawe)

Thomas, Mike (Newcastle E)

Morris, Rt Hon C. (O'shaw)

Thomas, Dr R.(Carmarthen)

Morris, Rt Hon J. (Aberavon)

Thome, Stan (Preston South)

Morton, George

Tinn, James

Mulley, Rt Hon Frederick

Torney, Tom

Newens, Stanley

Varley, Rt Hon Eric G.

Oakes, Rt Hon Gordon

Wainwrlght, E.(Dearne V)

O'Brien, Oswald (Darlington)

Wainwright, R.(Colne V)

O'Halloran, Michael

Warden, Gareth

O'Neill, Martin

Weetch, Ken

Orme, Rt Hon Stanley

Wellbeloved, James

Owen, Rt Hon Dr David

Welsh, Michael

Paisley, Rev Ian

White, Frank R.

Palmer, Arthur

White, J. (G'gow Pollok)

Park, George

Whitlock, William

Parker, John

Wigley, Dafydd

Parry, Robert

Willey, Rt Hon Frederick

Pavitt, Laurie

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

Pendry, Tom

Williams, Rt Hon Mrs(Crosby)

Penhaligon, David

Wilson, Gordon (Dundee E)

Pitt, William Henry

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

Powell, Raymond (Ogmore)

Wilson, William (C'try SE)

Prescott, John

Winnick, David

Price, C. (Lewisham W)

Woodall, Alec

Race, Reg

Woolmer, Kenneth

Rees, Rt Hon M (Leeds S)

Wrigglesworth, Ian

Richardson, Jo

Young, David (Bolton E)

Roberts, Albert (Normanton)

Roberts, Ernest (Hackney N)

Tellers for the Noes:

Roberts, Gwilym (Cannock)

Mr. Lawrence Cunliffe and

Robinson, G. (Coventry NW)

Mr. Austin Mitchell.

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

Housing Benefits
10.13 pm
The Under-Secretary of State for Health and Social Security (Mr. Tony Newton): I beg to move,
That the draft Supplementary Benefit (Housing Benefits) (Requirements and Resources) Consequential Amendment Regulations 1983, which were laid before this House on 17th March, be approved.
Hon. Members may be relieved to know that this is the last batch of supplementary benefit amendments consequential on the introduction of housing benefit—[Interruption]—well, the last batch of positive amendments; at least, I hope it is. It has undoubtedly been a major task to remove housing requirements from the complex web of supplementary benefit regulations and then to make the necessary adjustments to take account of the housing benefit changes. This final set comprises the usual mixture of technical adjustments and more significant provisions. I intend to confine my speech initially to the latter but, of course, if any hon. Member wishes to raise questions about the more technical provisions or on other points arising from the regulations, I shall do my best to answer them later in the debate.
The first amendment of significance is regulation 2(5) 1(b) in which we have provided for an addition to housing benefit supplement. This arises out of a point which I believe was first picked up by the Disability Alliance. As hon. Members know, the housing benefit supplement protects those who would otherwise be brought below supplementary benefit level after paying that part of their rent and rates not rebated by the local authority. Under housing benefit, supplementary benefit recipients who must pay an inescapable charge for amenities such as heating, have the amount of their charge above a standard amount included in their rebate. The effect is that no supplementary benefit claimant in this position is obliged to find any more than, for example in the case of heating, £5·60 a week from his own resources.
This amendment puts the housing benefit supplement recipient in exactly the same position. Without the amendment contained in the regulations, the income of the person in question could be reduced below supplementary benefit levels. We are keen to avoid that. We do not think that many people could be affected adversely, but there may be about 5,000 of them and they could lose considerable sums of up to £5 or more a week. This regulation is intended to prevent that from happening. Local authorities have been warned already about the proposed changes and asked to be ready to correct the deficiency if and when the regulation is approved.
Next, we have made a number of changes to the provisions for non-dependant deductions—the deductions to be made in the householder's assessment because of the presence of other adults in his household. In regulation 2(6)(b) we have provided for no non-dependant deduction to be made from supplementary benefit housing requirements where the claimant is already having a deduction made in the calculation of his housing benefit. That applies particularly to those who are buying a share in the equity of their home and paying rent on the balance. Their housing costs will be met by a combination of housing benefit and supplementary benefit. It would clearly be wrong in such a case to make two non-dependant deductions. In regulation 2(6)(b) we have

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provided for no non-dependant deduction to be made where the non-dependant is a full-time student, supported wholly or partly by the claimant or his partner.
Regulation 2(6) (c) makes perhaps the most important change. The regulations provide currently that a full deduction should be made—£4£70 per week—unless the non-dependant is in receipt of supplementary benefit, of pensionable age, or aged under 21. This would mean that some unemployed or sick people whose incomes were a little above supplementary benefit levels only could face difficulties in making their contribution to housing costs. We have therefore provided that the deduction in such cases should be reduced to £2.20 a week, provided that the non-dependant has been in receipt of certain benefits related to sickness or unemployment for at least 13 weeks and has income comprising one or more of unemployment benefit, sickness benefit, maternity allowance, injury benefit or child benefit only. The cost of this concession, together with the parallel concession in the Housing Benefits (Miscellaneous Amendments) Regulations 1983 will be about £2 million a year.
The other main element to note in the regulations is perhaps the transitional protection they provide for those few claimants whose benefit would otherwise be reduced by the provisions of these and the earlier sets of amendment regulations. One in particular is worth special mention because it has been the subject of discussion in the House on several occasions.
Hon. Members will recall that, from 4 April, 16 and 17-year-olds will not be eligible for the non-householder housing contribution. My hon. Friend the Minister for Social Security undertook to make transitional arrangements for young people under the age of 18 who are receiving supplementary benefit when the change comes into effect. This has been done at regulation 2(7) (b). Non-householder claimants aged 16 or 17 in receipt of benefit in the week commencing 28 March—that is to say, the week commencing yesterday—will continue to receive the non-householder contribution for as long as they remain in receipt of supplementary benefit to non-householders.
Mr. David Alton: The Minister talked about transitional arrangements. Will he say something about local authorities that cannot implement the new unified housing benefit simply because the information has not been provided by the DHSS to the local authorities? In authorities such as mine, on 4 April, when stage 2 is to be implemented, some 7,000 people will be without unified housing benefit purely because the information has not been made available and transitional arrangements have not been made.
Mr. Newton: Perhaps the hon. Gentleman will be aware that we have recently circularised local authorities and our offices about providing for the arrangements to continue so that the existing payments will go on to cover the period until the areas where the transition has fallen behind have caught up. Undoubtedly, there are problems in some places. There are not that many, but enough to have made it necessary for us to issue guidance in the past month.
From that brief summary, the House will realise that the main thrust of the regulations is to tidy up and ease the transition to housing benefit. Despite the differences of opinion about the scheme as a whole and particular aspects
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of it, I hope and believe that there will be no difference of opinion on the need to do everything possible now to complete the change successfully.
10.21 pm
Mr. Derek Foster: The Under-Secretary of State has beer optimistic enough to say that these are the last amending regulations on this subject that the House will have to consider. How he expects the local authorities to cope with the flood of regulations and circulars that his Department has been sending out or how he expects claimants to understand their entitlements, I fail to understand.
First, I draw the attention of the House to regulation 2(7)(a), which amends regulation 23(1) of the requirements regulations. It corcerns the non-householder's contribution and effects a further cut. The regulation now provides that a non-householder's contribution to household expenses may be assessed at more than £3·10 up to a maximum of £6·55 in the circumstances defined in sub-paragraph (b). The effect of the amendment is to remove that provision and to stipulate that the non-householder's contribution shall always be assessed at £3·10. Although the transitional provision in the new paragraph 23(3)(b) affords some protection to those currently receiving the higher rate, some claimants in future will receive less as a result of the amendment than they would have otherwise. Does the Under-Secretary have any estimate of how many families will lose as a result of that?
Surely regulation 23(1)(b) is fair as it stands. As we all know, in some circumstances it is reasonable to expect a larger contribution to household expenses. A non-householder may be a cause of extra costs—for example, a disabled teenager or a daughter who becomes pregnant. The effect of the amendment, as the Under-Secretary must know, is likely to be hardship for some families on low incomes.
The remainder of regulation 2(7)(b) inserts a transitional provision protecting 16 and 17-year-olds who are currently benefiting from the non-householder's contribution, and would otherwise lose it. The House will recall that from 1 April new supplementary benefit claimants aged 16 to 17 will not be eligible for non-householder housing addition. That means that teenagers whose parents are claiming unemployment benefit, people who have been out of work for less than a year and parents on low wages will lose £3·10 a week to save the Treasury about £29 million over the next two years. Can the Under-Secretary of State tell us how many of these teenagers and their families will lose as a result of the change?
Regulation 2(3) makes two minor amendments to regulation 12. Those amendments are objectionable in themselves, but they raise the more general issue of heating charges. SHAC, the Shelter Housing Aid Centre, claims that there is still a wide measure of confusion among local authorities about the provision for rebating heating and other fuel charges above the maximum limits in certificated cases. In fact, DHSS local offices appear to be giving conflicting advice to local authorities both about the extent to which these regulations will apply and the extent to which local authority decisions will affect claimants' entitlement to supplementary benefit heating additions. In general, claimants are wholly confused by the procedure.

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Is the Minister aware that in one current SHAC case a London tenant has spent considerable time trying to work out what the appropriate rebate should be in his case but has failed to receive any response from his local authority to correspondence on the subject over the past three months. It is said that Newham council decided that the whole business of partial fuel charges was too much trouble. Many people in Newham are having a deduction of £5·60 made even though their fixed charge represents only background heating. Is the Under-Secretary of State aware of that? Can he confirm it and, if so, will he promise to investigate? That is only one example of the problems arising out of heating charges.
Regulation 2(5) relates to housing benefit supplement. Once again the amendment is beneficial, but there are considerable problems with housing benefit supplement, as the Under-Secretary of State must know. Already a number of major administrative problems are becoming apparent which will result in many poor people losing out on their entitlement. This is particularly serious because of the absence of any procedure for backdating entitlements to housing benefit supplement.
The administrative problems that have been identified by SHAC are as follows. First, DHSS offices are failing to write the excess income figure on rebate and allowance application forms issued to those people lifted off supplementary benefit in April of this year. Secondly, DHSS offices are refusing to let local authorities have a list of those claimants lifted off supplementary benefit to enable them to check whether all those who are entitled to claim rebate or allowance under the new arrangements have done so. Thirdly, claimants are receiving inadequate information and advice on filling in local authority rebate and allowance application forms, as a result of which some forms are not being returned to the local authority.
Fourthly, circular HB 82(2) inadequately explains the procedures for making a double non-dependant deduction in housing benefit supplment cases. Paragraph 14(7) of the circular has been interpreted in different ways by different authorities and no other advice has been provided to local authorities by the DHSS. As a result, some authorities have recently had to revise computer programmes because they were unaware of the correct procedure to follow. Many other authorities may still be unaware of the problem and, as a result, there may be incorrect assessments of housing benefit entitlements.
Fifthly, there is inadequate advice to local authorities for identifying entitlement to housing benefit supplement among existing rebate and allowance applicants and new applicants who go first to the local authority.
The advice contained in circular HB83(3) is helpful only to pensioner applicants. It was extremely late in being issued to authorities, most of which had not received it before the end of February. As various case studies prepared by SHAC show, failure to identify entitlement to housing benefit supplement can lead to serious losses—for example, £5 a week or more for some pensioner couples with income of about £60 a week.
Regulation 2(6) makes a number of amendments to regulation 22 of the Supplementary Benefit (Requirements) Regulations 1980 relating to deductions for non-dependants. By and large, the amendments are beneficial, but attention must be drawn yet again to the losses that will occur because of changes in the treatment
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of non-dependant deductions. When the Minister wrote to my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) on 16 December 1982, annex B gave a breakdown of losses resulting from the changes.
But, because of double counting, it was not possible to derive a cumulative total for the number of losses. I must therefore press the Minister to say how many people will lose because of the changes in the treatment of non-dependant deductions, and what the average loss will be.
Since the last edition of the yellow book, there have been four sets of amending regulations. To understand these regulations, we must first undertake a complicated scissors and paste job to establish exactly what is being amended. It would be almost impossible for an ordinary claimant to establish from the regulations his entitlement. I hope that the Minister, in the interests of clarity, will introduce consolidated regulations so that we can all understand them.
There will be delays in implementing the regulations. It is abundantly clear that some local authorities cannot implement the new scheme in time. On 2 March the Department issued a circular, HB83(4), making contingency plans for late implementation. The Housing Benefits (Transitional) Amendment Regulations 1983, which were laid on Friday, provide the necessary legal powers. I suspect that there will be an opportunity for a fuller debate on that matter at a later date. In the meantime, the Minister must give details of the extent of the problem. He must come clean with the House and tell us just how badly the scheme is going wrong. The problems are much greater than either he or his hon. Friends pretend.
The problems arise in both certificated and standard cases. Our impression is that it will be widespread in the case of the former, and rather less so for the latter. Some certificated cases were included in the partial start last November, but only those who were local authority tenants and who had no non-dependants living with them. All other certificated cases now come under the scheme. Problems may have arisen, first, because the DHSS local offices had not passed over all the certificates in time, or, secondly, because the local authority, even though it had received all the certificates, had not been able to process all the cases in time.
In the latter case, the main cause of the problem has been the detailed form that has been sent to private tenants. It is a four-page form which is sent by the DHSS local office to the private tenant but which has to be returned to the local authority with some proof of rent payments and the last notice of rent increase from the landlord. It goes into everything under the sun and, by report, has produced an abysmal response. Many forms have not been returned because tenants are confused, and many that have been returned are incomplete. It has been described as one of the major blunders of the scheme.
Any delay in standard cases is attributable to the local authority, not the DHSS. The circular refers to computer problems, one cause of which is the misunderstanding of the procedures for making a double non-dependant deduction in housing benefit supplement cases due to the inadequate explanation in circular 82(2). That has meant that many authorities have had to revise their computer programmes.
I must press the Minister for separate answers to the following questions. First, in how many local authority areas will there be late implementation in certificated cases

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because the DHSS local office has failed to send out certificates in good time? Secondly, in how many local authority areas will there be late implementation in certificated cases for other reasons? Thirdly, in how many local authority areas will there be late implementation in standard cases?
The Minister should be able to give estimates based on the progress reports from local offices. The House is entitled to ask why the Government have insisted on rushing through the new scheme when it has been clear that many local authorities would not be able to implement it in time. What are the reasons for the haste? It is clear from the transitional arrangements for the areas of late implementation that some claimants will not have the benefit adjusted immediately to take account of any rate or rent rise in April. They will get backdated benefit later, but in the meantime they may suffer hardship. It is also clear that some claimants who suffer taper losses or lose entitlement to benefit completely will be faced with a demand to pay back overpaid benefit. It is clear from the circular that no recovery action will be taken in relation to overpayments in certificated cases when they are not the claimant's fault. Why, then, should standard cases be treated any differently?
Delays in implementation represent only part of the picture of confusion. Organisations such as SHAC which are in touch with many local authorities throughout the country report that they are still receiving inquiries about the new scheme, just a few days before implementation. The story is generally one of an over-complicated scheme in the first instance that is being implemented in too much of a rush which, in turn, inevitably gives rise to last-minute contingency plans when things go wrong.
I shall now deal with losers in relation to the Budget extension of mortgage interest relief. The Red Book shows that the cost of the increase in the mortgage interest relief limit is forecast to be £50 million in 1983–84 and £60 million in a full year. For that money, the 2·3 million losers from taper changes could have been largely avoided. Will the Minister say exactly what it would would cost to eliminate all taper losses? Will he confirm that the £60 million of mortgage relief would almost cover that?
Is it not true that many authorities are still very confused about the implementation of the review procedure?
Mr. Andrew F. Bennett: Totally.
Mr. Foster: I am sure that my hon. Friend is correct. In one SHAC case, an authority has failed to respond to all requests by a certificated claimant within the partial start for a review of his housing benefit entitlement.
The publicity arranged by the Department for the introduction of the scheme has been severely criticised by local authorities and other housing organisations. In distinct contrast, there has been extensive publicity of the new mortgage arrangements. The national coverage of the new housing benefits scheme, which affects one in three of the population, has been minimal. This document is the Department's effort to inform claimants of their entitlements under the new scheme, and we could describe it—not unkindly—as Comic Cuts without the laughs. It is much less informative than the previous document, and is an everyday story of city folk with people who have names such as Margaret and Winston. But it provides little
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information to the claimants. We are entitled to ask the Under-Secretary of State, who was responsible for producing the leaflet? While his Department struggles with that, the much-maligned Islington council has managed to produce much more comprehensive information in seven languages.
This is a very complex scheme that was brought in too hastily, so that amending regulations are arriving only slightly more slowly that applications from tenants for benefit.
10.42 pm
Mr. Andrew F. Bennett: We must put the matter of housing regulations in context. The Government's justification for introducing the new housing benefit scheme was that it would be a major simplification of the system. However, if one considers the regulations or the explanatory memorandum supplied to the Joint Committee on Statutory Instruments, no one could accept that it was a simplification. Almost all local authorities are finding the regulations very complicated, and even the Government's officials managed to make two substantial mistakes in this instrument which led to the withdrawal of the original order and the laying of a new one. That is a further illustration that the entire matter is complicated and difficult to follow. Any hope that it would be a major simplification has not been fulfilled.
During the past two or three months, every time that I have met a group of pensioners, I have been inundated with questions about how the scheme will affect them. When I write to the local benefit office, I receive a reply that has been worked out with much care and sympathy, but it does not make the position clear to those people or to me. They still believe that they have lost out in some way, and in many instances they have lost out in cash terms. They have not only lost money but have suffered confusion and disbelief. That is still the position, although the scheme is supposed to be introduced completely on 4 April. Almost all of those with low incomes wish to know exactly how much money they have to spend and do not wish to run the risk of getting into debt. Most of my elderly constituents are adamant that they have never owed anyone a penny, and they do not intend to do so. If they do not know how much they will have to pay when the scheme comes into operation, they make estimates, and that causes hardship because they do not know how much money to put aside for that purpose. The Government should make the position clear to those people as soon as possible.
Will the Minister tell us how many people will not be brought into the scheme from the starting date in April? How soon after that will they be brought in? Will he give a guarantee that if they have been given too much benefit, in that the losses have not been taken away from them, they will not be asked to repay that money? Clearly it is not their fault. My understanding is that the certificated cases will not be asked to repay the money, but it is surely just as important that non-certificated cases, if they lose out as a result of the Government's tampering with the tapers, should not be asked to make any repayments.
Can the Minister now give us an up-to-date figure of the number of people who will lose? We were told earlier that there were various estimates, and that about 2·3 million people would be involved. Many people felt that that was only a guess. We should now be told the number of people who will lose. What happens to a person who

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is in a block of flats or perhaps a house which is heated by the local authority and the heating system fails for a week or a fortnight? Will that person get a refund from the housing department to pay for any alternative heating that he has to use, or does he have to apply for supplementary benefit for the heating during that period?
I hope that the Minister will tell us the position about appeals tribunals or local authority appeals. I have a constituent who was very aggrieved about the loss of the rent-free weeks. She attempted to persuade the ombudsman that he should look at the issue. Eventually I persuaded the local authority to allow her to apply to the appeals tribunal. It is arguable whether the appeals tribunal will have jurisdiction over the rent-free weeks, but the local authority told me that it did not intend the matter to go to an appeals tribunal. In other words, the local authority chooses which cases go to an appeals tribunal. How can an appeals body be independent if the local authority decides which cases can be submitted—in other words, which it thinks can be justified? I hope that the Minister will assure us that, in his view, it is not for the local authority to decide whether an appeal should be heard, and that the appeal body should hear the case and make up its own mind.
I hope that the Minister will say something about the interrelationship between the cohabitation rules of supplementary benefit and the appeals procedure over decisions by local authorities to go on paying housing benefits to families. I know of one instance where an individual was accused of cohabiting and the benefit was removed. The people in the case then applied for housing benefit and were told, "You will not qualify for it because you should qualify for supplementary benefit. If you don't qualify for supplementary benefit, you can't qualify for housing benefit", although it was clear that their income was sufficiently low, if their supplementary benefit was removed, for them to qualify at least for housing benefit.
We predicted in Standing Committee that there would be problems here, and I wonder whether the Minister has any evidence on whether that is an isolated case in Greater Manchester—not Stockport—or whether there have been considerable problems in this respect.
Finally, I wonder whether the Government have thought any further about the rent-free weeks, which clearly have caused more difficulty than anything else. This in not a problem to be solved piecemeal by local authorities. It should be solved by clear Government direction. Many people have told me that the rent-free weeks applied only when the scheme was introduced and that the problem is not a continuing one. That is nonsense. It applies to anyone who comes into the scheme for any reason. Depending on the date when a person joins the scheme, he may gain or lose as a result of the rent-free weeks.
This is a major anomaly and a major cause of confusion, and it is time that the Government brought in a regulation to make it clear that local authorities and the Government should provide a common system so that some people do not lose money while others gain. The regulations are absurd. They were supposed to simplify the system, but in fact the already complicated supplementary benefit regulations have become even more complicated.
10.52 pm
Mr. David Alton: Like the hon. Member for Stockport, North (Mr. Bennett), I had great reservations about these regulations when they were laid before the House. When we discussed them on 26 July last year—on a hot summer night—both the hon. Member for Stockport, North and I voiced our feelings about them, but, unlike me, the hon. Member had the benefit of serving on the Standing Committee.
The hon. Member for Stockport, North and the hon. Member for Bishop Auckland (Mr. Foster) have both expressed accurately and eloquently the main reservations that many hon. Members had last year, and still have, about the operation of the unified housing benefit. The hon. Member for Stockport, North referred to the rent-free weeks. I have received representations from Liberal councillors in Chelmsford about that matter which they say works to the disadvantage of tenants in their area. I have also heard from people elsewhere about some of the effects of the regulations in their own communities, and in particular of the effects of the rent-free weeks. The hon. Member for Stockport, North was right to highlight that issue as one of major concern to many people.
I should like the Under-Secretary to clarify the position of private tenants. I raised this subject with the Minister for Social Security, who replied to our debate on this subject last July. The Minister kindly answered a number of questions during the course of that debate. I would not have relished his role on that evening, and he dealt very fairly with the hon. Members who intervened in his speech, but the position is still not clear, although the scheme will be implemented on 4 April.
What will be the position of private tenants whose rent falls into arrears because of non-payment by local authorities and who might later on be subject to eviction? I fear that if a 12-week period elapses whilst people are in arrears—this is especially relevant because many local authorities will not be able to implement the scheme on 4 April—private tenants may find their landlord taking them to court and possibly trying to have them evicted from their homes. Landlords sometimes try to do that, and these regulations will make it easier for them to do it. I would welcome a reply from the Under-Secretary on that point.
I too have great reservations about the appeals tribunals. The hon. Member for Stockport, North and I both voiced objections last July. How many people will lose out as a result of the enforcement of the regulations? Shelter state that some 2 million people will probably be 75p a week worse off. Can the Under-Secretary tell us whether that figure is correct? Much of that money may be transferred to other groups such as the pensioners who will be better off as a result of these regulations, but is it true that 2 million of the lowest wage earners in the country will be 75p a week worse off? No hon. Member would go out of his way to reinforce poverty, and if that could be among the results of these regulations the Government should think again.
I think that the Minister will agree that when the proposals were first introduced there was some doubt as to whether local authorities would be able to comply with the deadlines imposed by the Government. Local authority associations and many local councillors expressed reservations about their ability to implement the proposals.

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When I asked the Minister for Social Security last July whether it would be possible to implement the first stage of the scheme by November, he replied:
"We have undertaken to meet all their additional costs"—
costs incurred by the local authorities—
"in implementing the scheme, including the additional costs that may be incurred by training staff. The local authorities are perfectly happy with that."
When I asked whether the local authorities were happy to implement the proposals by November, he replied:
"Yes, Sir. I am talking not about the main scheme, where there may be complications, but about the simple case in which we certify that a tenant is on supplementary benefit."—[Official Report, 26 July 1982; Vol. 28, c. 763–4.]
I understand from the local authorities that that was true. Stage 1 of the proposals was implemented without great difficulty because all those involved were local authority tenants, so there was no great difficulty in transferring their accounts to local authority computers and paying their rents directly.
The second batch of people coming into the scheme, however, are private sector tenants who previously received rent or rate allowances or rebates. In Liverpool, about 14,000 people are involved. I contacted officials of Liverpool city council today to discover what would be the effect on those tenants. This is what was between the lines of the Minister's comments last July. Although those 14,000 claimants are currently receiving benefit from the DHSS, 7,000 of them will not receive their housing benefit from 4 April—in just six days' time—because the information has not been given to the local authority by the DHSS. That is not entirely the Department's fault as it had far too limited a period in which to implement the proposals.
Forms were sent out to all the people then on supplementary benefit and they were asked to return them to the local authority. Only 7,000 have so far done so. Again, this means that probably the most disadvantaged groups, some of whom will be illiterate and unable to fill in the forms at all, will receive no housing benefit at all from 4 April, so they will be about £10 per week worse off. Perhaps the Minister will confirm that figure. According to my local authority, those 7,000 claimants will on average be between £7·50 and £8·50 per week worse off and it will be June or July before they are on the computer and in receipt of the benefit. What transitional arrangements are the Government making to help those people?
Mr. Mike Thomas: Is my hon. Friend aware that this is not just a problem for Liverpool but is paralleled throughout the country? In Newcastle, for instance, there are serious worries about what will happen after 4 April. The problems that my hon. Friend describes are widespread. This is due not only to the Government, although they bear a large share of the responsibility, but to the simple fact that local authority housing departments are often not so familiar as the social security authorities with assessing problems of this kind and getting the questions answered and the benefits computed.
Mr. Alton: I was about to give other examples as I thought that I heard a Conservative Member suggest that the problem might be confined to Liverpool. As my hon. Friend has pointed out, the same applies in Newcastle. Officials in Leeds told me today that they expect about 5,000 cases not to have been processed by 4 April, so those
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tenants, too, will be £8·50 to £10 per week worse off. In Maidstone, in the south of England, some tenants—the exact number is not known—will not be able to receive their benefits simply because they have not been able to comply with the guidelines laid down last July. Six or seven months ago, in the debate, many of us argued that this was a sleight of hand and part of the insidious process to try to erode the welfare state.
For example, at about that time there was a 5 per cent. cut in unemployment benefit, and the Think Tank's report had just been mooted. There has also been a decision to wipe out rent and rate rebates and rent allowances and to replace them by unified housing benefit. All those decisions should be seen in the same context, together with the cuts in local government expenditure. Those cuts have led social services departments and area health authorities, such as my own, to cut back. That could be seen as part of a pattern which many hon. Members are worried about.
In addition, the rights of local authorities were being interfered with. They were not properly consulted, As, once again, local authorities were not properly consulted and were not taken into the Government's confidence, a half-baked scheme has been accepted by the House, although it is not now capable of implementation.
The Minister for Social Security (Mr. Hugh Rossi): I have listened to many of the hon. Gentleman's points, but they are really a gloss on what has happened. He is not right to say that there were not the fullest consultations with local authorities. Indeed, the Government's original intention, as the House knows, was to bring the full scheme into operation last November. However, because the local authorities felt that they could not bring the whole scheme into operation in November, we decided to bring the second part of the scheme into operation in April. It was at their request. They assured us that by then they would be ready to implement the whole scheme.
There were reservations that last November was too soon for the first part of the scheme, but in the event we were proved right and the Jeremiahs were proved wrong. Obviously there will be some teething troubles when people are not returning the forms sent to them, and we shall make arrangements to ensure that those people do not lose financially. However, the hon. Gentleman should not exaggerate the situation in the way that he has done.
Mr. Alton: I was trying not to exaggerate the situation but to put it in perspective. Earlier, I mentioned that I accepted what the Minister had said in the debate on 26 July 1982. He gave an assurance that the local authority element of the scheme would be implemented, and it was. However, perhaps the Opposition did not sufficiently press the Minister on the effects of the second stage of the scheme. That second stage will be implemented on 4 April, and many of us have grave reservations about that. It will not be possible for local authorities to implement it, and most local authorities told the Minister and the Government at the time that they were unhappy with the scheme anyway. The Association of Local Authorities was opposed to it at the time.
However, the Government have often ridden roughshod over local authorities and their rights. They did so in the Local Government, Planning and Land Act, and in the Housing Act. They took away the right to determine whether or not a local authority should be able to sell council houses to sitting tenants. Now they are, in a sense,

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doing it again. There is a breakdown in co-operation between central and local government, and that has manifested itself in many areas of legislation. It is not just this Minister who is involved. It is part of a pattern that can be seen over the past three and a half years.
I reiterate a point that I made last July. The average tenant finds it impossible to understand how the benefit works. The whole idea was that it would be more simple, but it has turned out to be far more complex. The hon. Member for Bishop Auckland spoke about how Islington borough council had been able to translate the proposals into several different languages. In the debate last year I read out a chunk of one of the regulations that was virtually impossible to understand. I suggested that it would be very difficult to translate into Hindi, Gujarati or Urdu. The hon. Member for Watford (Mr. Garel-Jones) said that it would be a good thing if they could be translated into English. Those of us who have tried to decipher the regulations know that they are about as easy to understand as a Rubic cube. They are complex and are the sort of things that a Philadelphian lawyer would find very difficult, let alone the average private or corporation tenant.
For all those reasons, I am opposed to the regulations and share the reservations that have already been expressed. I hope that the Minister will be able to reply at the end of the debate to some of my points.
11.4 pm
Sir Paul Hawkins: I am sorry for the Minister because we are producing form after form and regulation after regulation that are incomprehensible to the average man and woman. They do not necessarily all come from his Department, but many do.
In rural areas such as my constituency with as many as 200 villages some 35 miles from the regional office of the Department of Health and Social Security, to send out forms and expect them to be filled in and returned is about as good as sending me an income tax form and expecting me to fill it in without the help of an accountant. Elderly people cannot be expected to return such forms.
There is great confusion, much of which is caused by local authorities not being up to their job and without the know-how to process such forms. Local DHSS offices, certainly in my constituency, are doing their level best to cover a wide area with no bus routes to the centre and where elderly people are often without a telephone. It is an almost impossible task.
All I would ask is that before we think up any other schemes we should try to make them as simple as possible. We should not send out three or four page forms to the elderly living perhaps 30 miles away from the centre and without a telephone.
My secretary probably deals with five or six such cases a day. Having dealt with them for some 14 years she generally understands what people are getting at on the telephone or by letter. However, she has to put those problems to the DHSS and many of the junior officials do not understand the forms themselves.
All I ask is that country districts should have local offices open on market days when buses come in from the countryside so that complicated forms can be explained to those who have to fill them in. It is too much to ask elderly, deaf and infirm people to travel some 30 to 35 miles to a DHSS office where, if they cannot be seen
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within an hour or so, they have to leave to catch their bus home and thus waste a day without seeing anybody who can help them.
I understand that in most cases the Minister is trying to help people. In many cases a person will benefit if a form is filled in properly. However, I hope that before the Government begin their second term of office we shall try to simplify the forms and procedures. We should try to think of those who have to fill in the forms who are mostly the ill, disabled and those living long distances from the offices.
11.10 pm
Mr. Terry Davis: In his opening remarks the Under-Secretary of State explained that the regulations are necessary to deal with some of the "anomalies" in the housing benefit scheme; I prefer the word "defects". My hon. Friend the Member for Bishop Auckland (Mr. Foster) explained clearly how some of the defects affect people all over the country.
I want to express great disappointment that the Government have not taken the opportunity to rectify one of the greatest defects in the scheme for tenants of Birmingham city council. I recognise that the problem has arisen because of the way the housing benefit scheme has been implemented by the city council and not as a direct result of the intention of the Government. Nevertheless, the defect has been drawn to their attention and I am not only disappointed but amazed that they are not doing anything about it. It will cause great suffering, as I will show, for tenants of Birmingham city council who come under the housing benefit scheme.
It must be emphasised that the defect affects every tenant in Birmingham covered by the scheme. In most local authorities the rent is paid in advance; in Birmingham it is paid in arrears and it becomes payable on a Monday. It follows that when the housing scheme came into effect on 22 November, which was a Monday, the tenants of Birmingham city council were liable to pay their rent on that day. The supplementary benefit which they received on that day or on succeeding days was reduced by the amount of the housing element. They therefore expected that the introduction of the scheme would mean that the rent for that Monday would be covered by the Department of Health and Social Security. It came as a great surprise to everyone that the tenants of that council would have to find one week's rent out of their basic supplementary benefit without any extra money from the DHSS.
As I have explained, their supplementary benefit was reduced on the day the housing benefit scheme came into operation or on succeeding days. It was reasonable for everyone to think that this was all right because the scheme was taking effect at the same time. However, the housing department wanted to be sure about the matter so it contacted the Department of Health and Social Security, pointed out that people were being asked to pay on Monday, 22 November, the rent for the preceding week and inquired whether this meant that it should look to the tenants for that rent or whether the scheme would cover it, bearing in mind that the tenants had become liable to pay the rent only on the day the housing benefit scheme came into operation.
To be fair, I must point out that a civil servant in the Department of Health and Social Security sent a most helpful letter in reply. I have seen a copy of that letter and

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it was well intentioned. It is clear that the civil servant believed that Birmingham city council should look to the DHSS and not to the tenants for the one week's rent. Unfortunately, the officers of the city housing department decided that they could not rely on the letter from the DHSS without showing it to the city solicitor. When it got into the hands of the lawyers, the answer came back that, whatever the DHSS thought, the lawyers believed that the tenants were liable for the week's rent because it was the rent for the week before the scheme took effect.
Up to that point I had sympathy with the city housing department. I do not know why its officials thought it was necessary to show a letter from the DHSS to the city solicitor, and why they could not have accepted it in good faith and gone ahead in the interests of the tenants. However that may be, I then lost all sympathy with Birmingham city council. It should have gone back to the DHSS and said that, although it had received the Department's letter reassuring it that the rent was covered by the scheme, it had had legal advice that the Department was not correct.
It would have expected discussions to have taken place between the city housing department and the DHSS in the interests of tenants who by definition have so little income that they are covered by the scheme. Instead, the Conservative-controlled housing committee simply went ahead on the basis of the council's own legal advice and decided typically to clobber the tenants, to charge every tenant covered by the scheme one week's rent and so put them into rent arrears. It then sent out letters demanding one week's rent from all these tenants. Not surprisingly, some tenants went to their local councillors, some came to the advice bureaux of Members of Parliament and others went to the citizens advice bureau. All these representatives took up the problem with the city housing department. The position was then explained to us.
Since I was not satisfied, I wrote to the Secretary of State for Social Services, who happens to represent part of the city of Birmingham. My hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) made the mistake of writing to one of the junior Ministers, and he tells me that he has not yet received a reply, although it may be in the post. I have received a reply from the Secretary of State so I can tell my hon. Friend and the hon. Member for Norfolk, South-West (Sir P. Hawkins) that it is not that local authorities do not have the know-how—the city of Birmingham has the know-how; it knows how to clobber the tenants. It is also that the Secretary of State for Social Services will not do anything about it, even though his constituents are affected by the implementation of his housing benefit scheme. In his letter, which I have received within the past 24 hours, he says that it is a matter for the city council and that he will not intervene.
When I wrote to the Secretary of State for Social Services, I explained that I could not believe that he had intended the housing benefit scheme to operate in such a way. I was prepared to accept from the Secretary of State that it was the usual attitude of Conservative councillors in the city of Birmingham which was responsible for tenants being asked to find an extra week's rent and not his scheme. Now he has told me that the only difference between Birmingham and the Department of Health and Social Security concerns the dates of commencement and termination—a perceptive comment by the Secretary of State as that was the whole purpose of my letter to him.
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The Secretary of State explains that as the only difference concerns the dates of commencement and termination, and as the tenants will be covered by the housing benefit scheme for the right number of weeks, there is no need to do anything about it. In fact, it is precisely the date of commencement that matters, because it means that tenants are being asked to find one week's rent out of their basic supplementary benefit or supplementary pension.
Many of those tenants are old-age pensioners. Some of the people who have come to me are in their seventies and have never owed a penny in their lives. They are upset at finding suddenly that they have been put into rent arrears through no fault of theirs. In the real world in which these old-age pensioners and I and my hon. Friends live, the date of termination will be when they die because these old-age pensioners will never come off supplementary benefit and pension. They will never live to see themselves come out of the housing benefit scheme. They will never get back the extra week's rent from the housing benefit scheme through not having to pay a week's rent or receive it in some other way from some other benefits. These people have never been in rent arrears in their lives and they have been put there by the combined efforts of the Conservative Government and Conservative city council.
Mr. J. W. Rooker: I do not know whether my hon. Friend has seen the latest figures from the Birmingham city housing department. It claims that in the last quarter of last year rent arrears in Birmingham rose by £2 million. It is blaming it on the tenants whereas we can see clearly, from what my hon. Friend has said, that it is a paper transaction and is no fault of the tenants.
Mr. Davis: My hon. Friend is right. It is worse than that, because these people are being asked to pay a week's rent. Many of them are old-age pensioners, some of them are families with young children and some are single-parent families. They all, by definition, have great difficulty in making ends meet.
Whatever may be the differences between the Government and the Opposition about the extent to which supplementary benefit can and must be increased, I should have thought that we could agree that the amount of supplementary benefit is calculated so carefully that it does not provide for luxuries. It does not provide the luxury of one week's rent. Those people are now being asked to pay one week's rent out of their basic benefit and pension. That means that an old-age pensioner or a single parent will have to choose between buying food or clothes for the children and paying one week's rent—about £20, which is a lot of money for someone who is living on supplementary benefit or supplementary pension. They will have to pay that amount out of their supplementary benefit for an extra week's rent instead of buying food or something else.
This is an appalling scandal. The worst thing is that the Secretary of State, who represents part of the city of Birmingham, has refused to intervene. The Government must stop trying to play Pontius Pilate and deal with this defect in the housing benefit scheme as well as the others.
11.21 pm
Mr. Newton: In the light of the vigour with which the hon. Member for Birmingham, Stechford (Mr. Davis) has

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just spoken, I shall pick up his point straight away. He will realise that as my right hon. Friend the Secretary of State wrote to him in a letter dated 24 March, of which I have a copy, there is relatively little that I can add at this stage. We have noted his remarks. I have no doubt also that the Birmingham city council will note his remarks, supported by his hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker).
I say almost as an aside that my hon. Friend the Member for Hornsey (Mr. Rossi), the Minister for Social Security, tells me that he sent the hon. Member for Perry Barr a copy of the Secretary of State's letter to the hon. Member for Stechford on the day that it was dispatched or a day later. However, there has been either a mistake or a misunderstanding. I undertake on behalf of my hon. Friend that we shall make sure that he has a further copy of it at the earliest moment.
Having said that, it would be wrong for me to attempt to follow further the comments by the hon. Member for Stechford, but in fairness to my right hon. Friend, I ought to place firmly on the public record the major point that my right hon. Friend made in the letter to him. He said:
"The local administration of housing benefit is the responsibility of individual authorities and not for my Department. As happened in this case, authorities are free to ask my Department for advice, but at the end of the day, they have the final responsibility for implementing the new scheme in their area.
If claimants in Birmingham are dissatisfied with the authority's interpretation, they have a remedy in the review procedures under part VIII of the Housing Benefits Regulations 1982. These include the opportunity for a claimant, or their representative, to have their detailed case heard by a review board of local councillors."
Mr. Terry Davis: I wish to put to the Minister a most important point. The defence of the city housing department is that it has no choice and that it is a matter of law. It has been advised by the city solicitor that it must behave in that way. Is the Minister saying that it has a choice? The implication of the Secretary of State's letter is that it can decide for itself how to implement the housing benefit scheme. The hon. Gentleman seems to be taking that line, too. It is of great importance to the tenants of Birmingham whether the Government believe that the city of Birmingham has been wrongly advised on legal grounds and is taking the decision on policy grounds.
Mr. Newton: I cannot say much more than I have already said, which places on the record what my right hon. Friend has already written to the hon. Gentleman, but obviously, in view of the strength of feeling, especially as it has been expressed in the House, both we in the Department, and undoubtedly the city of Birmingham, will have a closer look at what has been said tonight, particularly at the suggestion that the legal advice given to the city of Birmingham is at variance with the implied advice contained in my right hon. Friend's letter. It would be stupid for me to venture into judging between competing advice, both sets of which have been drawn at some stage from legal advice off the cuff from the Dispatch Box.
Mr. Andrew F. Bennett: If the Minister is suggesting to individuals in Birmingham that they should go to the review body, it would be essential for them to have a copy of the letter of advice from his Department and the legal
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advice which supported it. Will he make it available to hon. Members so that they can supply it to anyone in Birmingham who wants to go to the review body? Will he also ensure that his officials can be called to a review body to give evidence in support of their letter?
Mr. Newton: I do not want to go beyond what I have already said and give off-the-cuff comments or commitments which could have legal consequences, but I can undertake that we will consider urgently tomorrow the hon. Gentleman's points.
Mr. Rooker: Before the Minister leaves this subject, I should like to put to him a point which is not unimportant for the tenants of Birmingham city council. When he conducts these discussions, for which we are grateful, will he be careful about the involvement of the chairman of Birmingham housing committee, who has been known in the past few months to disclose the personal details of tenants' rent arrears on radio programmes?
Mr. Newton: The hon. Member will not expect me to comment on that. I hope that the House will now allow me to move on to other significant and important points that have been raised during the debate, on the understanding that I recognise the strength with which hon. Members from Birmingham and elsewhere have spoken about this matter and will study carefully everything that has been said in the debate.
The hon. Member for Bishop Auckland (Mr. Foster) asked several important and relevant questions. He asked how many people stand to lose from the provisions in regulation 2(7)(a). I am advised that only about 300 claimants benefit from the existing provision which is being altered. We have changed it on the basis that, if a householder is having difficulty in meeting housing costs, his proper recourse should be to housing benefit or supplementary benefit. If the housing benefit claim succeeds, the non-dependent deductions will equate to the non-householder contribution, and there is therefore no need to top up the non-householder's supplementary benefit. If the claim fails, there can hardly be hardship on any reasonable interpretation of the word. I hope that the hon. Gentleman will agree that the consequences of the change are not as serious as he had initially feared.
With regard to 16 and 17-year-olds, the hon. Gentleman talked of £29 million being "clawed back" by the Treasury. He spoke as if the £29 million constituted an addition of sums, taking two years together: £10 million in 1983–84 and £19 million in 1985. His comments must be viewed against the background that the withdrawal of the non-householder contribution in these cases is part of the general package in which savings from one area are being ploughed back to make improvements elsewhere. While I accept that it is possible for hon. Members to object to the policy, as did the hon. Member for Stockport, North (Mr. Bennett) in a previous debate on this subject, it is unreasonable to imply that this £29 million is being clawed back by the Treasury from one group of claimants, especially against the background of the transitional protection that we are introducing, and not to recognise that it is being ploughed into the significant gains that are being made by, for example, more than 1 million pensioners within the scheme.
With regard to the identification of people who might be entitled to housing benefit supplement, and the related questions which the hon. Gentleman raised, I hope he will

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have registered the important statement made by my hon. Friend the Minister for Social Security a week or so ago about the advice that we have issued to local authorities—which, as I said at Question Time the other day, we believe should, if applied, enable local authorities to identify virtually all pensioners applying for housing benefit who might qualify for either housing benefit supplement or for supplementary benefit. As I have said, I think that there is a good prospect that this will assist one of the supplementary benefit take-up problems. At least, that is my hope.
If we have made a useful move for pensioners, I must acknowledge that we have not so far found a comparable formula to apply to non-pensioners. However, we are continuing to look for one. If er can find one that is satisfactory and workable, we shall issue comparable advice to local authorities.
The housing benefit supplement should be paid from the same day as the award of housing benefit. That is our intention within the regulations.
As for the number of losers from the non-dependant package, I cannot add to the information that was given in quite an explicit letter from my hon. Friend the Minister for Social Security to the hon. Member for Perry Barr during December. The problem is as stated in the letter and the reasons why I cannot go further are similarly as stated.
Mr. Alton: As the Minister can elaborate on those who will gain, it is not clear to me why he cannot elaborate on the reasons why others are losing. I ask the hon. Gentleman to give us rather more details.
Mr. Newton: The December letter was nearly two pages long and I think that the sensible course would be for me to send the hon. Gentleman a copy. The number of losers from the taper changes will be about 2·3 million. I have been asked to state the number of losers from the changes in the non-dependant arrangements, and it is in that area that much greater difficulties arise.
Among many others, there was one good and helpful question from the hon. Member for Bishop Auckland to which I have a simple and clear-cut answer. It is one that gladdens my heart as much as I trust it will his. The hon. Gentleman made a plea for consolidating regulations. We desire these as much as he does and we shall endeavour to ensure that they are produced as soon as possible. I am sorry that I have to spoil the debate by using that how-long-is-a-piece-of-string phrase, but I mean "as soon as possible".
Mr. Andrew F. Bennett: I trust that they will be issued free of charge.
Mr. Newton: The hon. Gentleman pushes his luck. We shall certainly issue them at the most economical price. Bearing in mind the way in which inflation has decreased under the Government, the regulations will be less expensive than they would have been if the previous Labour Government had introduced them.
I revert as fast as possible to the housing benefit scheme. It is common ground that guidance has been issued to authorities. This is intended to ensure that claimants who suffer delays will continue to receive help with their rent and rates until all the necessary arrangments have been made.
The hon. Member for Liverpool, Edge Hill (Mr. Alton) talked about private tenants. We were anxious to produce
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the contingency plan in reasonable time because we recognised that private tenants were especially vulnerable to delays in help with their rent and rates. They need cash payments to help meet the liability to the landlords. As the hon. Gentleman said, they face the risk of eviction if they cannot meet it. Our plans are specifically designed to maintain continuity of payment to private tenants, particularly those on supplementary benefit, until the cases can be transferred. Arrears will then be made up.
Mention was made of delays in certificating private tenants' rent forms. Authorities must make interim payments of rent allowances under housing benefit regulation 35 within 14 clays of receiving the certificate from the DHSS unless they have no information about the tenant's rent. Delays in getting back correctly completed rent allowance forms should not stop authorities providing some help in most, if not all, cases, because authorities should have some idea of local rent levels if only from running the existing rent allowance schemes. I do not pretend that there can never be a problem, but it may not be as large as the hon. Member for Edge Hill implied.
I was asked about the authorities which might not complete on time. Our progress reports do not provide answers in detailed category form. Our rough estimate is that about one third of authorities have reported delays in one area of the scheme or another. I do not wish to gloss over the position, but in many years many local authorities do not complete on time their rebate exercises for the existing rent and rate rebate schemes. It is rare for all the exercise to be completed perfectly every spring.
One of the problems in the social security system last year was the result of delays in fixing rent and rates and carrying through the administrative arrangements by some local authorities. We keep an eye on the position. I cannot break down the figures further.
Mr. Foster: The hon. Gentleman has taken us aback by confessing that one-third of authorities will be unable to implement the Act on the relevant day. We knew that difficulties existed, but the Minister increases our fears.
Mr. Newton: That remark is not entirely justified, because much will depend on something about which we cannot give detailed information tonight, although we shall wish to report to the House further when we can. Much will depend on the numbers involved.
Only a relatively small number of claimants may be involved in the case of most authorities. I do not want to give the impression that I am saying that one-third of authorities will fail in a broad sense to implement the scheme in reasonable time. In the same way, many social security officers may be a day or two—or a week or two—late in completing every uprating case in the autumn. There will be some spillover and it would be a mistake to exaggerate the problem. We shall report to the House more fully when we can do so.
The hon. Member for Stockport, North (Mr. Bennett) asked about appeals. I agree that it is not for the 'local authority to decide which cases should go to the review board. Regulation 47(1) of the housing benefit regulations 1982 state that the claimant can "require" a review. I hope that that will be observed in all parts of the country.
Representations were made to hon. Members by SHAC, the Shelter Housing Aid Centre. If it provides me with written details of cases, I shall see what I can do. It would be a mistake, and not helpful to the House, to comment on anecdotal evidence.

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There is relatively little that I can add about any of the detailed points raised on housing benefit. I wish to conclude in a way that may appeal to both sides of the House—
Mr. Brynmor John: Can the Minister reassure the House on one point? He talked about one third of local authorities not being able to start their schemes on time. That may affect some thousands or even tens of thousands of people. What transitional protection will he give to the tenants who will be disadvantaged by the failure of local authorities to implement the scheme on time?
Mr. Newton: I hope that I have already made it clear that we have issued guidance to local authorities providing for the continuation of the help they currently give during any period of difficulty that may arise in some cases for some people. If it turns out—I have no reason to suspect that it will—that the arrangements are not adequate to protect those whom we seek to protect, we will be prepared to consider them further. I wish to put it firmly on the record that it is no part of our wish that anyone should suffer because of delays which, in some cases, are inevitable in some areas where there has been difficulty in the social security system during the past few months. It is no part of our purpose that anyone should suffer, and we shall do everything possible to ensure that it does not happen.
I wish to say something that I hope will be welcome to both sides of the House, and especially to my hon. Friend the Member for Norfolk, South-West (Sir P. Hawkins). The Department recognises that a great deal of work remains to be done in simplifying our leaflets and forms. That is recognised throughout Government. My hon. Friend will be aware that only last week the Lord Privy Seal made a statement about the Government's progress in eliminating forms, and their progress in simplifying them. I can fairly claim on behalf of the DHSS—and it will be acknowledged by my right hon. Friends—that that Department is one of the leading Departments in both making progress and seeking to make further progress in that area. I assure my hon. Friend that we shall continue to do so.
Question put:—
The House divided: Ayes 55, Noes 6.

Division No. 108]

[11.43 pm

AYES

Alexander, Richard

Mather, Carol

Ancram, Michael

Miller, Hal (B'grove)

Beaumont-Dark, Anthony

Mills, Iain (Meriden)

Berry, Hon Anthony

Nelson, Anthony

Bevan, David Gilroy

Neubert, Michael

Boscawen, Hon Robert

Newton, Tony

Bright, Graham

Osborn, John

Brooke, Hon Peter

Page, Richard (SW Herts)

Buck, Antony

Rossi, Hugh

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

Sainsbury, Hon Timothy

Cope, John

Shepherd, Colin (Hereford)

Dorrell, Stephen

Speller, Tony

Douglas-Hamilton, Lord J.

Stanbrook, Ivor

Dover, Denshore

Stewart, A.(E Renfrewshire)

Dunn, Robert (Dartford)

Stradling Thomas, J.

Dykes, Hugh

Temple-Morris, Peter

Fenner, Mrs Peggy

Thompson, Donald

Fox, Marcus

Walker, B. (Perth)

Garel-Jones, Tristan

Waller, Gary

Goodlad, Alastair

Watson, John

Gorst, John

Whitney, Raymond

Griffiths, Peter (Portsm'th N)

Wickenden, Keith

Hamilton, Hon A.

Williams, D.(Montgomery)

Hawkins, Sir Paul

Wolfson, Mark

Jopling, Rt Hon Michael

Young, Sir George (Acton)

Knight, Mrs Jill

Lang, Ian

Tellers for the Ayes:

Lester, Jim (Beeston)

Mr. David Hunt and

Lyell, Nicholas

Mr. Douglas Hogg.

Major, John

NOES

Alton, David

Steel, Rt Hon David

Brown, Ronald W. (H'ckn'y S)

Howells, Geraint

Tellers for the Noes:

Hughes, Simon (Bermondsey)

Mr. A. J. Beith and

Lyons, Edward (Bradf'd W)

Mr. David Penhaligon.

Question accordingly agreed to.
Resolved,
That the draft Supplementary Benefit (Housing Benefits) (Requirements and Resources) Consequential Amendment Regulations 1983, which were laid before this House on 17th March, be approved.

Upholstered Furniture (Safety)
11.53 pm
The Minister for Consumer Affairs (Dr. Gerard Vaughan): I beg to move,
That the draft Upholstered Furniture (Safety) (Amendment) Regulations 1983, which were laid before this House on 7th March, be approved.
I welcome the opportunity to explain these rather complicated regulations, because they will help to reduce the number of accidents due to upholstered furniture catching fire. Cigarettes are the most frequent cause of such fires, and two thirds of furniture fires are due to smouldering cigarettes. The victims are usually overcome by the dense fumes that come from modern upholstered furniture when it is set alight. Suffocation and poisoning from fumes is much more likely than actual burning. In 1981 alone, 154 people died in this way, and 830 were injured.
It is clear that if the upholstery used in such furniture could be made less likely to catch fire, many accidents could be avoided. We have already taken some steps. Since the beginning of the year, all new upholstered furniture coming on to the market has had to pass British standard 9 for resistance to smouldering cigarettes. As the new furniture replaces the older furniture over the next 10 to 15 years, we should have far fewer fires and a major improvement in home safety.
The other cause of this type of fire is matches. Such fires are also fairly common, although matches cause fewer fires than cigarettes, because most people know when they have dropped a match and put it out. Nevertheless, there are accidents. In 1981, 24 people died and 150 people were injured in fires started by matches. There is now a match test, and we hope gradually to apply it to a wide range of furniture. At present, furniture covered in wool or leather is more likely to pass the test than furniture covered with other materials. If it does not pass—and that will happen in the case of most furniture—it has to carry a warning label.
That is the present position. All furniture now has to pass the cigarette test, and it has to carry a label if it does not pass the match test. Unfortunately, however, labels can fall off, or people can forget to put them on. So after discussing the matter with the trade, we think that it would be clearer for everyone to have a positive safety label on the furniture. That is what regulation 4A will do. I should add that this is widely welcomed by the furniture trade.
Apart from old stock which is still held in shops, in future all furniture will have to be labelled. There will be two kinds of labels. The first will be a square green-edged label, saying that the furniture passes the safety standards for both cigarettes and matches. Alternatively, it will have to carry a warning label that it does not pass those standards. As all furniture has to pass the cigarette test, this will simply be a warning that it is not totally safe in the case of fire caused by matches.
Another aspect of the regulations involves children's upholstered furniture. Just over a year ago, we had reports of fires from this kind of upholstered furniture—not due to cigarettes and matches, but because they were placed too close to fires. To prevent such fires, I issued a prohibition order last April, the Children's Furniture (Safety) Order 1982. It was to last for one year only. It limited the amount of polyurethane foam and expanded
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polystyrene that could be used in the upholstery. I am glad to report that since then there have been no further accidents.
This order will expire on 6 April, and it is important that the prohibition should now be made permanent. The industry pointed out that by detailing the materials as we did it is possible for one dangerous material to be replaced by another, and that in its view it would be much better to have an overall safety standard. I agree. We would have done that in the first place, but it would halve taken a considerable time to develop new standards, and I thought—correctly, as events turned out—that it was urgent to have some control. That is why I detailed the materials.
We are now in a position to require that the materials pass a British standard test, as set out in the regulations. Children's furniture with very little upholstery will be exempted, and there are some rather complicated transitional arrangements in regulation 5A(i)(b). The purpose is to avoid having a gap between the ending of the previous order on 6 April and the coming into force of the new regulations. The regulations will apply to goods for sale here, and goods made here for export. I do not claim that these regulations are the complete answer. It would be very nice if all furniture could pass both cigarette and match safety tests, but that is not practicable at the moment. It would mean either that the furniture became excessively expensive—the cost of a suite of furniture would be increased by about £30 to £40—or that the furniture was unpleasant to use and that people would not want to buy it.
A good deal of research is being done into this problem. My Department is sponsoring research into useful ways of classifying upholstery, and the British Standards Institution is investigating ways of measuring the rate at which a fire develops. The Government are also following, and contributing to, research into the filling materials used in padding furniture. It is the dense smoke that these materials can give off that is so dangerous. When I visited the fire research station recently, I was allowed to drop a match on to an upholstered armchair. The flame went up the back of the chair quite slowly until it was about an inch from the top, and then, to my great surprise, it spread with appalling speed. Within seconds the room—we had left by then—was filled with some of the densest black smoke that I had ever seen. I was told that on average this happens after only 1½ to 2 minutes, and that escape from the premises would then be extremely difficult. I was told that this is one of the causes of family deaths. An adult in the family smells something wrong, goes downstairs to see what is happening and then, because of the fumes, cannot get back to rescue the rest of his family.
The regulations are not a perfect solution but they are a step in the right direction. I believe that they will reduce the incidence of deaths and injuries, and I recommend them to the House.
12.2 am
Mr. John Fraser: I welcome the regulations and the progress that has been made in protecting consumers from furniture that is highly inflammable or that is toxic when it catches fire. I welcome the fact that the smouldering cigarette test will

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now apply to all furniture and that the labelling will be more permanent. In previous debates there has been some criticism of the tie-on labels that are sometimes used.
Eventually, consumers should be protected from furniture that remains liable to catch fire under the match test. The Minister has just given a graphic example of how furniture can become lethal within minutes. That example reminds us that it should be our aim eventually to protect consumers from all furniture which is likely to have that characteristic.
The Minister tells us that research is being carried out. It would be interesting to know whether there are any leads which might result in safer furniture. Some manufacturers claim that at little extra expense they could produce fabrics that could pass the butane gas test.
Can the Minister tell us what change in the pattern of sales there has been since the regulations were introduced in 1980? I in no way criticise the idea of labelling furniture, but the mere labelling of furniture only gives warning of the risk; it does not eliminate it. I may be wrong. Consumers may have changed their patterns of furniture purchasing dramatically as a result of the information statutorily made available to them about the risks involved, but I suspect that that is not the case and that, despite the interference with freedom that it entails, mandatory prohibition of dangerous furniture will eventually be necessary. In this context, one thinks of the recent tragic loss of life in the Italian cinema fire, in which I suspect that foam seat filling was involved as well as neglect of safety regulations. I should be grateful for any information that the Minister can give about whether purchasing patterns have changed markedly as a result of the regulations or whether he agrees that progress should continue to try to ensure that all furniture is absolutely safe.
The dangers of foam-filled furniture came to the fore after the Woolworth fire in Piccadilly, Manchester. I realise that the Home Office was responsible for the inquiry into that, but as long ago as May 1980 the Home Secretary said:
"I agree that suitable regulations should be made under section 12 of the Fire Precautions Act 1971 to control the display in shops and department stores of polyurethane foam-filled furniture, and have authorised the necessary research to be put in hand to devise the details of such control."—[Official Report, 20 May 1980; Vol. 985, c.104.]
I do not know what liaison there is between the Department of Trade and the Home Office in these matters, but perhaps the Minister can tell us whether that research has led to any recommendations that might be followed by the Department responsible for consumer protection.
The question of consolidation was raised, with justice, in the previous debate on housing benefit regulations. It is important that regulations relating to any matter, but perhaps especially to safety, should be clearly and easily understood by anyone who has to operate them. There is great advantage in not having subsidiary legislation by amendment or by reference but whenever possible reenacting the legislation and putting it in the simplest and clearest possible form. Perhaps the Minister will tell us when these regulations will be consolidated.
12.7 am
Mr. Bill Walker: Given the right conditions for combustion, all upholstered furniture will burn. Almost every filling, whether traditional or modern, will burn, and most will give off fumes.
Considerable research has taken place in the development of fillings that are cost-effective and can be used in the modern designs that consumers wish to buy. The only sure way to prevent fires is to ban matches, cigarettes and all other sources of ignition, but that is neither realistic nor practicable. We must therefore continue to search for other answers.
The British Furniture Manufacturers Federated Associations, for which I speak, have always taken a constructive but realistic attitude towards the public desire for safer upholstered furniture. In so doing, they have acknowledged the technical and financial implications of compliance with the match test, to which I shall return in a moment.
The associations' attitude towards the amended regulations now before us can be summarised as follows. They favour positive labelling. I remind my hon. Friend the Minister that the associations and I proposed positive labelling at the outset, but we were informed that this would not conform with the provisions of the Act. The associations also favour bringing children's furniture within the regulations. Again, I remind my hon. Friend that the manufacturers said last year that this was a better way to deal with the problem than prohibiting specific materials.
The BFMFA believes that no really worthwhile purpose will be served by making the match test mandatory at this point. Indeed, in the present state of technical knowledge, it would not be very wise to set a date for this test, no matter how far in the future it may be. I would go further and say that it would be irresponsible to make the match test mandatory, or to set a date, when the technical problems have not yet been resolved.
To set a date could result in even more time and energy being expended to very little purpose, because after all, it is the smouldering cigarette that is the real problem and the main source of accidental fire for upholstered furniture. Indeed, as has been said, two thirds of fires stem from that source. I think that my hon. Friend the Minister would also accept that most of the solutions to fires stem not from objective but from subjective analyses. They are made after the event, and it is difficult to prove whether a smouldering cigarette or a match caused the fire unless the individuals in question can say what the source was.
As the cigarette test is now mandatory, it would seem sensible and reasonable to leave the match test out. Anyone who has studied this problem will be aware that the handle of material and the feel of the finished product have much to do with design and customer appeal. At the end of the day we must realise that it is the customer who is the final arbiter on all these things. It is no good—as they discovered at Linwood—making cars that no one will buy. It is no good the British furniture manufacturers making furniture if people decide that they do not want to buy it simply because the design no longer appeals and so buy other products.
Furniture is a fashion industry and is very much influenced by the pressure on pockets. Anyone who has studied how the British public spends its money will realise that more money is spent on drinking, smoking and

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gambling than on furnishing, or indeed on buying homes. Therefore, we can see the pressures on the furniture industry.
The classification of fabrics and fillings has much to commend it, because in some instances the fabric on the wrong filling can produce a finished article that is more liable to ignition than the same fabric on a different filling. Therefore, the combination of filling and cover is important, and positive labelling in that respect is very welcome.
Some technical problems must be resolved before legislation can be introduced for the match test. The Furniture Industry Research Association has carried out considerable work in this area, and is of the opinion that an objective study would need to be carried out before the Minister could introduce legislation for the match test. In the opinion of the association, to do so on present knowledge and information would be a gamble—an absolute gamble. In the present state of the British furniture industry we cannot take such a gamble.
Instead, the Minister should conduct a study to determine the current fabrics in use and their ability to be upgraded. Indeed, only a tiny proportion of the total fabric that is used on British upholstered furniture would pass the flame test at the moment. I refer largely to the wool fabrics which represent a small proportion of the total used in the furnishing industry. Obviously there will have to be a change in the composition of fabrics, and we will have to know about the effective treatments, the likely treatments that are being developed, and new fabrics and new materials. There is a distinct need to forecast the availability and cost factors involved in these important solutions.
It is suggested that we should conduct a survey of at least 30 domestic furniture manufacturing companies and a substantial number of key retailers to discuss the problems with them in depth and hence find out the problems that they perceive on the introduction of the match test. As a result of the study, it would be possible to forecast the cost implications. My hon. Friend the Minister touched on that, and perhaps the figure of £30 was on the low side. I always thought that it would be much higher if one tried to account for every item of furniture upholstered in a fabric that would comply with the match test. For example, upholstery covered in wool is much more expensive than that covered in man-made fibres. There is much more work, therefore, to be done. We would also have to look at the 95 per cent. of fabrics that are on the market that would not pass the match test and develop treatments or alternatives, and that could not be done easily.
I understand the pressures that my hon. Friend and his Department face from those concerned with fire safety. We are all worried about fire safety because one death in a fire is one death too many. But we must also put such deaths into perspective against the number of homes in the United Kingdom and the number of people who die every day on the roads and as a result of other accidents. One can then see that the deaths from upholstery fires are comparatively few. However, I repeat that one death is one death too many. Consequently, I welcome the fact that my hon. Friend accepts that the arguments need to be studied in greater depth and that he will take full account of the views and evidence of the furniture industry.
I can remember that when we last debated this subject the hon. Member for Hackney, South and Shoreditch (Mr.
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Brown) told us of the cushions that he kept in his garage. A long time has passed since then and I imagine that they are still in his garage. I have not heard that they have combusted as he said they would. I look forward to hearing his observations and comments. It seemed to me at that time that those of us who had had such furniture for many years were under some threat. I have had the upholstery that I sit on at home for nearly 30 years and I wonder how much I am at risk if one can leave such cushions to combust in the garage. Of course, I am being a little frivolous, but this is a serious problem both for the individuals who wish to use the upholstery and those who work in the industry. Somehow we must get the balance right. We should not be panicked by those who wish us to bring in unworkable regulations that would not be cost-effective.
12.16 am
Mr. Ronald W. Brown: I have just spent part of the last hour reading the speeches that were made on 22 May 1980. I notice that the hon. Member for Perth and East Perthshire (Mr. Walker) has been sacked from a few jobs since then. He had to declare many interests on that occasion but today declared only his interest in the British Furniture Manufacturers Federated Associations. I too must declare that I have been sacked. For 14 years I was a representative of the Furniture Timber and Allied Trades Union, but because I am no longer a member of the Labour party and because the Communist general secretary of that union decided that I was not competent to represent it, I am no longer its parliamentary adviser. The Communist general secretary does not like to have a member of the Social Democratic party representing the union. Therefore the hon. Gentleman is not the only one who has lost a few jobs.
I still maintain my close interest in the subject of polyurethane foam. The hon. Gentleman misses the whole point. He keeps asking the Minister to introduce inquiries and to do this and that to the industry, but, as I said in the last debate, no manufacturer has the right to produce anything that is not safe. It is nonsense to produce an unsafe material and then demand that the Minister should use taxpayers' money to find some way of overcoming the by-product. It is no good the hon. Gentleman shaking his head because that is the position.
Mr. Bill Walker: I trust that the hon. Gentleman will accept that there are some who think that cigarettes should be banned because there is evidence to suggest that cigarettes can be harmful. Yet as a non-smoker I would not dream of saying that cigarette manufacturing companies must carry out tests and so on in the way that the hon. Gentleman is suggesting.
Mr. Brown: The hon. Gentleman is changing the subject. We are talking about a material that is known to be dangerous.
Mr. Walker: So are cigarettes.
Mr. Brown: They may be harmful, but they are not dangerous.
Mr. Walker: They are.
Mr. Brown: That is a matter of opinion. I do not want to enter into an argument across the Floor of the House. The foam is dangerous.

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I thought that the Minister had been reading the speech that I made in the debate on 22 May 1980 when he rehearsed the argument that within 30 seconds the temperature of the flames will rise to 650 deg. C. He forgot to add the other bit that after three minutes the toxic fumes are superheated to 1000 deg. C and, as he rightly observed, people are killed by the inhalation of the superheated smoke and the toxicity of the smoke rather than by the burning. Therefore, I come back to the point that anybody who manufactures that sort of material has a major responsibility, which they cannot offload on to the Minister or anyone else. The manufacturers cannot expect the Minister to hold an inquiry to find a way of covering up their mistake. It is no good taking that attitude. Society and the House are entitled to expect the industry itself to take action.
I am sad that the Minister, so long after the 1980 debate, has been unable to tell us what work has been undertaken by the manufacturers to produce a safer foam. When he replies, I hope that the Minister of State will tell us exactly what work has been carried out by the industry, what steps have been taken to make the foam safer and whether he proposes to tell the manufacturers at any time that unless they can produce a safe foam they cannot go on manufacturing it.
In regulation 2(3)(b) it is proposed that the word "resistant" should appear on every label. I am not sure that it can be proved that the material is resistant. In 1980 we could not claim that it was resistant. I was assured by the right hon. Member for Gloucester (Mrs. Oppenheim) that she could not use the word "resistant" because if an article caught fire and it was shown that it was not resistant, she would be culpable; therefore, the Government would be responsible and could be taken to court. We had a long argument in private discussion about why she could not use the word "resistant". The Minister has not told me what has taken place between then and now to allow us to use the word "resistant" rather than the cautionary term indicating that people should be careful when using the furniture.
We have moved away from the major problem of the foam to the manufacturers of the fabric. When I was speaking in 1980 I said that it was disgraceful that the poor old textile industry, which was on its uppers then—it is even more so now—should have the responsibility of covering the dangerous material for the foam manufacturers who are on a gravy train. They make a great profit because foam is a by-product of petroleum; it is what is left over and so they do not pay for it. Yet the textile manufacturers have to go to great expense because the foam manufacturers have to have their bad material covered. I do not know why a levy is not put on them to contribute to the cost of £30 which has been referred to. Why should they not have to pay something, because it is their material that is causing the trouble? The Minister has again let the foam manufacturers off very lightly.
In regulation 2(3)(c) it is proposed that the label shall carry the words:
"Meets the requirements for resistance to cigarette and match ignition in the Upholstered Furniture (Safety) Regulations"
All those words will mislead a purchaser into believing that the furniture is safe, but it will be no safer than it was. If it catches fire, as the Minister rightly observed, people will not get out of the house; within three minutes they will
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all be dead. The words in the parent regulations were much better because they drew attention to the product itself and to the need for caution. Those words requiring caution should remain in the regulations. We should not give anyone the impression that if upholstered furniture which contains polyurethane foam has passed the cigarette test and/or the flame test there is no danger.
I believe that regulations 3(a) and (b) are not as dynamic as the 1980 regulations. I find regulation 5(a) a little odd. When it is read in its entirety it comes out about right, but it seems a little odd to have
"This Regulation applies to any children's furniture other than children's furniture".
There is then a hyphen and the regulation continues with (a), (b) and (c). I should have thought the regulation could have been worded slightly differently so that the meaning was plain—that children's furniture is excluded in certain circumstances only. I accept the Minister's point that the regulations have had some effect on children's furniture. However, he did say that if the furniture were moved nearer the fire, the fire had an effect on the foam and caused it to burn.
I still have the cushions in my garage and they are growing bigger and bigger and fatter and fatter. I had the feeling that hon. Members representing places such as Perth and East Perthshire would try and make a funny, so I checked the cushions this morning. Fortunately, the garage is not mine. I hired it so I can continue the experiment. It is fascinating and I am waiting to see the end product. I shall take the hon. Member for Perth and East Perthshire to see them one day and he will see them growing.
The Minister is now telling my tale so I shall not have to speak for so long. The hon. Member for Perth and East Perthshire also told my stories so I shall not have to cover that. In 1968 when I first began this trek I was either a fool, an educated fool or a malicious educated fool, because it was said that nothing that I was saying was true. I can claim to have moved from illegitimacy to legitimacy between 1968 and 1983. I find myself utterly kosher and returned to society. I have been, as it were, rejigged.
I am happy that the House, the Government and the Minister are beginning to appreciate the importance of this issue. The hon. Member for Norwood (Mr. Fraser) has always appreciated it. I have paid tribute to him for that. When he became Minister responsible for this subject he gave every consideration to all the information available to him. These regulations were started through his diligence. If he had not lost office before they were approved his name would have been on them rather than that of the right hon. Member for Gloucester.
I am prepared to support what is being put forward, but these regulations are not sufficient. The Minister did not tell us how many deaths he thinks may have been avoided because of the regulations. Can he assess whether there has been an improvement? I could not hear the number of deaths that he mentioned because of the talking that was going on around me, but I believe that he said that there had been about 800 injuries.
I am not sure whether the number of deaths has decreased. I have sought the figures and it does not appear that there has been an improvement. If the regulations were successful I should have thought that we would have seen a marked reduction in the number of deaths and injuries caused by fire.

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The hon. Member for Perth and East Perthshire, and the Minister also, I believe, said that two thirds of the fires are caused by smouldering cigarettes. As I said on the previous occasions when the matter was debated, there is not a shred of evidence that that is true. It is a subjective judgment made by a fire officer going around the scene when the fire is out and when the place is full of water. He looks round to see what he can find. He sees certain things. He sees whether electrical wiring is showing signs of wear. He tries to see whether coal from a fire has caused the fire and whether there has been arson by petrol and so on. He asks the people "Do you smoke?". They reply "Yes." He says "Ah. Were you smoking just before the fire?" "Yes." "Ah. What has happened is that you must have put a cigarette out." "I did not." "Yes, you must have put a cigarette out, but it did not go out properly. It smouldered and caused the fire." He writes the report on that assumption.
Dr. Vaughan: No.
Mr. Brown: The Minister says no, but I say, "yes". I read many coroners' reports, giving evidence of the cause of death. None of them says that the fire was due to a cigarette or a match. They all say "It could be", "It might be", "It possibly was", "There is evidence that", but not one says "It was". The one piece of evidence that is not available to the officer is the polyurethane foam. The reason why it is not available for the officer to examine is that it has been consumed. He would not know what the filling in the chair was because all the foam is consumed.
Mr. Walker: Does the hon. Gentleman accept that research conducted in Glasgow showed that over 50 per cent. of those who died that sort of death were intoxicated beyond the level at which they would be considered drunk? Does he think that that is a contributory factor?
Mr. Brown: No, I do not believe that that is a contributory factor because my view is that, even in those circumstances, if the foam had not been there, they might have been safe. That is what I believe to be true. The hon. Gentleman will keep on eliminating the foam as part of the cause. It is the cause. The hon. Gentleman said that anything burns. That is true. There is no argument about that. I have asked the hon. Gentleman before and I ask him again to name one combustible in the home that has the same burning characteristic as foam. There is not one. The hon. Gentleman does not have to think about that. I am telling him that not one combustible in the home will reach 650 deg C within 30 seconds of catching fire. No fumes reach 1,000 deg C within three minutes—from wool or anything else.
I wish that the hon. Gentleman would understand that. He is trying to make excuses, saying "Brown and the others are making a song and dance about this." He may be a representative of the British Furniture Manufacturers Federated Associations, but he does not have to grovel on his knees for them. It is perfectly straightforward that the foam is a problem. Now society is beginning to learn the important lesson that many people have died who need not have died if we had taken a stronger line on foam.
I welcome this further step with the regulations and sincerely hope that it will go some way towards helping to stop further deaths, although I very much doubt it. I again appeal to the Minister to insist that the responsibility of the manufacturers of foam is to find a safer foam. I was
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assured four years ago that much research was going on and that everyone was putting his hand to the wheel to find it. Four years have gone by and there have been no reports. I have tried to find out what has happened, who is doing the research and what progress is being made. The answer is that nothing is being done.
Why cannot the Minister say that he will give the industry one or two more years to get itself into good order and manufacture a safe foam, or he will give notice that he does not intend to extend the regulations beyond 1984? Putting the labels on is only a sign. The real problem is with the foam. Get rid of the foam, and many deaths due to fires in the home will cease.
12.35 am
Mr. Peter Griffiths: I doubt whether anyone will give other than a welcome to the regulations, but it is only fair to remind the Minister that many hon. Members consider the regulations to be only a modest step in the direction that is necessary if we are to have complete safety in the furniture used in our homes.
Pressure on the Minister's predecessor led to the introduction of the 1980 regulations, which were not directed primarily against the fabrics which covered the furniture. They were a response to a broadly felt public outcry against the deaths from fires which caused toxic fumes from the furniture's filling. When the 1980 regulations were introduced, many of us felt that, while it was desirable to seek to protect with a cover the dangerous material used for filling, the regulations were only a palliative. What is really necessary is the introduction of furniture fillings which may be combustible—I accept that almost anything is combustible under the right circumstances—but are not so combustible as polyurethane foam, and which do not give off toxic fumes when they are in flames.
I recognise that the regulations have a value inasmuch as they provide for safer covers to be used in furnishings or at least ensure that where safer covers are not used, the public who make the purchases know the risks they are running. However, in practice, the covers do not normally cause great injury or death. Certain synthetics flare and can melt, and the melted fabric can stick to the skin and cause serious burns. Therefore, I trust that the Minister will press on with the necessary arrangements, after the introduction of which he will not be prepared to tolerate furnishing covers which do not meet the match lest. It would concentrate the minds of the textile and furniture industries wonderfully if a date were fixed for the introduction of the match test for all furnishing fabrics. At the same time, we should recognise that even if that were done, we should not have dealt with the basic problem of dangerous fillings. I appeal to the Minister to consider the banning of polyurethane foam in furnishings and to follow the line for children's furnishings and phase out the use of those materials as far as possible and as quickly as possible.
I do not accept that, in a world that can put men on the moon, we cannot produce cheap, flexible fillings for furnishings. I am certain that we will go on using polyurethane foam for as long as it is legal and profitable so to do. We have had to say that dangerous children's toys cannot be sold, that dangerous electrical equipment cannot be sold and that dangerous motor vehicles cannot be sold. In the end it is necessary to introduce regulations because until they are introduced we will hear the argument that

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the better product would cost more money. That is a specious argument, because if we had less combustible fillings which, if they did burn, did not produce toxic fumes, it would not be necessary to have the same expensive processing of the covers. Reductions in the cost of covers could be set against the possibly increased cost of the fillings.
The regulations have further weaknesses concerning covers. The labels are likely quickly to become lost or removed. They are not likely to be available for the second and third-hand users of the furniture. It is common for furniture to pass from one room to another and then to be passed on to others for their use. There is a danger that furniture which may be acquired or received as a gift will not carry the necessary warning.
As furniture wears, the thickness of the covers is reduced. When the pile is at its thickest it may be able to meet the mandatory cigarette test, and may even have retardant properties to meet the match test, but after receiving heavy wear and when it becomes old it will not have the same resistant properties as hitherto.
I am concerned about the re-covering of furniture either professionally or by the use of furnishing fabrics that are used in the home, including the use of loose covers. The newly fitted cover may be more flammable than the material that it covers. A fabric which has good retardant properties may be subject to a greater flame from the new cover.
I am equally worried about the use of cleaners and solvents on furnishing fabrics. In a home where there are children there are spills on furniture which need to be removed. The chemical effect of the use of solvents, or scrubbing with soap and water, will be considerable on the flame retardant properties over a period.
As long as we follow the blind alley of retardant qualities for covers we shall continue to face the problems that I have listed. All these dangers could be removed by providing a safe filling.
I welcome the regulations and the progress that they represent in fire precautions, but they are still grossly inadequate. We should be directing our attention to the real culprit, which is the filling.
12.43 am
Mr. Raymond Whitney: I am grateful for the opportunity to contribute briefly to the debate, especially as it allows me the chance to offer my commiserations to the hon. Member for Hackney, South and Shoreditch (Mr. Brown), who has been removed from his post as adviser to the Furniture, Timber and Allied Trades Union by a Communist member of the union. The hon. Gentleman's contribution to the union and his assiduity over many years is widely respected in the furniture industry. It is highly regrettable that such action should have taken place. We may all have our views on the wisdom or otherwise of joining the Social Democratic party, but that scarcely merits the sort of treatment that the hon. Gentleman has received, especially when we bear in mind the service that he has given to the union.
I join in the welcome that the House has given to the regulations. They have been produced after extremely careful co-operation with the furniture industry. As my hon. Friend the Member for Perth and East Perthshire (Mr. Walker) has said, the industry welcomes the labeling
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proposals that are set out in the regulations and those on the setting of ignition performances for children's furniture.
I commend the Minister's decision not to put a date on the mandatory introduction of the match test. In that I disagree with my hon. Friend the Member for Portsmouth, North (Mr. Griffiths). Given the importance of putting no more strain on the industry in its present delicate state, nothing must be done, within the limits of safety, to jeopardise the future of that industry. There is a balance between the safety requirements and the economic health of the industry. The Minister's proposals have struck that balance.
Without more technological progress, the problem of the consumer attractiveness of the materials and the cost implications to which the Minister and my hon. Friend the Member for Perth and East Perthshire referred could be severe and have serious repercussions on the industry and on jobs.
I hope that the Minister will continue to pursue his wise course and use all the means in the Government machine and in the industry to find a final solution—if it is to be found—to the flammability problem. I hope that in the meantime he will hold to the line between the safety needs and the needs of the furniture industry.
12.46 am
Dr. Vaughan: This has been an interesting debate. It is extraordinary that so many hon. Members have such a deep knowledge of the subject. It is encouraging that the general view is that this is an important issue which we cannot let rest. Further research is needed and we must press the industry to get on with it, because we shall keep returning to it.
I have been asked many questions. I was particularly pleased to hear the remarks by my hon. Friend the Member for Wycombe (Mr. Whitney), who said that we must keep a sense of balance and recognise the efforts that the furniture industry has made. My hon. Friend the Member for Perth and East Perthshire (Mr. Walker) made the same point. The furniture industry is co-operative and it recognises the need to come forward with safer materials.
Listening to the interesting remarks by the hon. Member for Hackney, South and Shoreditch (Mr. Brown) I wondered how many furniture manufacturers there were in his constituency. He will know that their profit margins are very small indeed. We are not talking about an industry which slaps a high price on its products, so we must look at the industry's general problems if we are to do something which will push up the costs and reduce sales. The figure that we have heard tonight of the increase in cost of a suite of furniture would be even higher than the cost that I mentioned of £30 to £40. That is considerable.
The hon. Member for Norwood (Mr. Fraser) asked about research and less expensive substitutes. We have heard much about the importance of finding a substitute for foam. Foam creates the greatest danger, but substitutes cost three to four times more; they are extremely hard and unlikely to be acceptable to customers. It is not realistic to set a definite time limit when all furniture must conform to a match test. However, I know that the industry is carrying out research, some of which is sponsored by the Government, as quickly as possible.
Only 10 per cent. of furniture coming on to the market can carry the new label. Customer purchasing power is tremendously effective. I hope that customers will look out

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for furniture with a safety label and ask traders why they do not stock more of that furniture. In that way we shall increase the incentives for the industry to produce such furniture.
The hon. Member for Hackney, South and Shoreditch asked about figures. We do not have any realistic statistics. It takes 10 to 15 years to get stock out of the system. I forecast that within a few years definite figures will show a decrease in fires, especially those caused by smouldering cigarettes. I mentioned earlier that children's furniture—it is rather specialised furniture—has been made much safer. There has been a dramatic drop in the number of fires, which is pleasing.
The hon. Member for Norwood asked about the Home Office. It is currently considering regulations under the Fire Precautions Act 1971 in the light of recommendations made by the central fire brigade advisory council. That has occurred as a result of the serious fire in 1979 at the Woolworth store in Manchester. I understand that consultations with the trade and other interested parties are taking place. I undertake to follow up that matter with my right hon. Friend the Home Secretary.
Mr. John Fraser: I hope that the Minister will follow up that matter urgently. I know that it is not his responsibility, but it has been four years, which is a long time, since the Home Secretary gave an undertaking to toughen up the regulations. The history involves not months, but years—even decades—before something happens.
Dr. Vaughan: I appreciate the wisdom of the hon. Gentleman's remarks. The Home Office is taking some steps. It is asking that furniture in residential care homes passes both the match and cigarette tests. I know from my experience as a health Minister of the amount of attention that I and others gave to having fire-resistant materials in hospital wards and places where the elderly and mentally handicapped are nursed.
The hon. Gentleman asked when the regulations could be consolidated. We have no plans to do that, but if it becomes necessary to amend the regulations again we shall consider consolidation rather than endless amendments.
My hon. Friend the Member for Perth and East Perthshire spoke about the British Furniture Manufacturers Federated Associations, which have been of great help to us. My hon. Friend did indeed recommend positive labelling some time ago, and he must be pleased that we have now moved towards that.
As to children's furniture, I hope that I have explained why we introduced the requirement about materials at the beginning. It was the simplest and quickest way of dealing with the problem. It has taken some time to get a BSI certificate for the furniture. The requirements for children's furniture will be extremely stringent, as it
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applies to furniture for children under the age of 11, although it is usually used by much younger people. We are not referring to wooden high chairs and similar furniture.
I hope soon to be able to advance a standard for bedding and mattresses. My hon. Friend the Member for Perth and East Perthshire referred to the lack of evidence of cigarette fires and smouldering. He must be aware of the commonness of the 2 am fire when someone has gone to bed smoking and has fallen asleep and the smouldering cigarette has set fire to the bedding. Surely the incidence of fires in regard to people who smoke and have a high rate of alcoholism is conclusive that that type of cause is relevant.
The hon. Member for Hackney, South and Shoreditch referred to the responsibility for production. I hope soon to introduce proposals on general consumer safety. I hope that part of those proposals will be that the responsibility for production, major distribution and importing of dangerous goods will lie much more firmly on those people, rather than on shop traders. I hope that when those proposals come before the House, the hon. Gentleman will welcome them.
Mr. Ronald W. Brown: Does that mean that the EC regulations for product liability will apply to foam production?
Dr. Vaughan: I suggest that the hon. Gentleman waits until I introduce the proposals. The Department is also producing an illustrated handbook for the trade, as the regulations are difficult to understand in detail.
I hope that I have covered most of the points that hon. Members have raised. If I have not, I shall be glad to take them up afterwards personally and individually if hon. Members so wish. My hon. Friend the Member for Portsmouth,. North (Mr. Griffiths) wanted progress. We want it too. He referred to toxic fumes. I was not sure whether he was thinking of the majority of cases where death or injury is due to suffocation and carbon monoxide poisoning—that is the common cause—or whether he was concerned about hydrogen cyanide which is much less significant as it comes from specific types of plastic. When he talks about using other materials, he should be aware that the fumes from wool, silk and nylon can all be toxic. I only say that to show how complicated it is to find an effective substitute.
I hope that I have covered all of the main points. The debate has been helpful. I know that it will be studied by the industry and I hope that the House will approve the regulations.
Question put and agreed to.
Resolved,
That the draft Upholstered Furniture (Safety) (Amendment) Regulations 1983, which were laid before this House on 7th March, be approved.

Smith Houses
Motion made, and Question proposed, That this house do now adjourn.—[Mr. Goodlad.]
12.58 pm
Mr. David Gilroy Bevan: My interest in this debate is as the Member of Parliament for Birmingham, Yardley. Coincidentally, I have qualifications in the profession of the land and am a fellow of the Incorporated Association of Architects and Surveyors and of the Incorporated Society of Valuers and Auctioneers. This is one occasion when those matters are coincidental and can help me to consider the background to the subject.
There has been substantial difficulty in Birmingham about Smith houses. Those houses were fully explained as long ago as 1948 in the post-war building studies No. 25, a house construcion report by an interdepartmental committee appointed by the Minister for Health, the Secretary of State for Scotland and the Minister of Works. It stated that they were built by the Smith's Building System (Birmingham) Ltd., formerly British Steel Construction (Birmingham) Ltd. I understand that that company went bankrupt. The houses have foundations of reinforced concrete slab, thickened as necessary to form strip foundations. The walls are built of large factory-made units consisting of foamed slag concrete faced with burnt clay tails of the same face dimensions as stretcher bricks. These are moulded into a backing and fitted on site. The tails are 1¼ in thick and give no strength, and the block behind on the ground floor, the supporting wall of the house which is laid on the concrete slab—which is of foamed slag concrete—is only 6 in thick. That is 150 mm smaller than the scale rule.
That is the width of the block. That block on the first floor reduces to about 4 in or 100 mm thick.
This system came about as a result of pressure at the end of the war from Ministers to develop industrialised building systems to cope with the post-war bulge and to accommodate the returning members of the forces and those who desperately needed housing in that era. In Birmingham there are about 1,525 such houses. However, the number varies. In one letter that I received of 28 October the number was 1,525, but in a letter of 2 October it was 1,524, which could mean that one house had fallen down or been mislaid. However, the numbers were reduced. Those houses are predominantly in my constituency, in that of my hon. Friend the Member for Birmingham, Hall Green (Mr. Eyre), the hon. Member for Birmingham, Stechford (Mr. Davis) and the hon. Member for Birmingham, Northfield (Mr. Spellar).
The city owns 970 houses, but the letters that I have received say that it could be 979. About 550 houses have been sold as a result of interest by the tenants of the corporation of Birmingham, who have bought the houses under either the city or the national scheme. In analysing the problems, I wish to pay tribute to the help that I have received from my hon. Friend the Member for Hall Green, who has accompanied me to meetings with the chairman of the housing committee in Birmingham, who has met the association of owners, and who convened a meeting that was attended by the hon. Member for Northfield. I pay tribute to the hon. Member for Northfield and the hon. Member for Stechford, who have been diligent and interested in this phenomena on behalf of their constituents, and who are alarmed about this matter, as am
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I and my hon. Friend. We are alarmed because the situation has been complicated and the waters muddied. There has been structural trouble. Of those still in the city ownership, 84 have had remedial work completed or are in process of completion, and the number of properties in the 1983–84 remedial works programme is about 110, funded by the HIP and topped up by capital receipts. About £3 million was dedicated in the years 1982–83 and 1983–84 to refurbishing the properties by the council and the city of Birmingham.
I started to describe the walls of these properties. In the original prototype buildings there was no dampproof membrane in the supporting wall, although that was later altered, and one was fitted in the houses which developed from the prototype houses. At no time was a dampproof membrane put into the foamed cement slag floor of the house. The promoters claimed that it was unnecessary, as they believed that damp would not rise through the foamed slag concrete, which varies in thickness.
The junctions between the walls and partitions are made by recessing the units. The internal walls, which are like a jigsaw puzzle of blocks, which are put together and which have reinforced metal carrying handles and form an interweaving reinforcement of the block in the wall, are finished internally with lime putty and coated with plaster of Paris. They are reinforced horizontally with steel rods. I take issue with the Minister for Housing and Construction that they are not reinforced prefabricated concrete houses, because I and others consider that they are. It was interesting that they were omitted from the recent list of six houses of the prefabricated type scheduled for special investigation. I thank my hon. Friend for the information that we have been given today, that Smith houses are now to be the subject of investigation and that a report will be made on them.
These houses with their tapering walls—they are narrower at the top than at the bottom—lacked investigation in the first place. Even in 1948, the report says that no tests or calculations had been made by the Building Research Station on the strength and stability of the houses, but having regard to the thickness of the walls and the stiffening of the cross walls it thought that the efficiency would be satisfactory. Even in the prototype, the one that was built in Dangerfield lane, Wednesbury, it is said that
"a horizontal crack had developed in the staircase external wall and it is thought that this may be due to a slight spread of the roof at this point."
So even in the prototype in those far-off days, some 35 years ago, there was a crack.
"Dampness has been observed in the prototype at the base of the walls. The foamed slag concrete units were built into the walls and partitions in an immature condition, with the result that cracks had developed due to drying shrinkage."
I am quoting from the document that is available in the Library.
With regard to maintenance and durability it is mentioned that
"cracking is most noticeable on the ground floor party wall, where continuous vertical cracks, extending from floor to ceiling".
It then states that
"the possibility that the crack in the staircase wall is the result of structural movement cannot be overlooked".
Even in the prototype, the possibility of structural movement "cannot be overlooked". That is the basis of my plea to the Under-Secretary of State. I ask him to accept that these properties are subject to design failure, structural

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inadequacy and structural movement. Their problems have not been caused just by the sulphate growth in the shale that was the underfill to the slab of the floor. That shale was believed to have come from the Coventry Deep colliery and to have been untreated. It had not been fully burnt off and thus in later years the shale was able to grow, and the walls heaved and bulged. The problems, however, are not due only to that growth; they have other causes too. In my view, the same symptoms could develop elsewhere in similar circumstances of ground movement. I believe that wind and suction tests were carried out yesterday by officials of the Department on houses in the area, and that various other tests have been carried out.
It is obvious that even at the prototype stage the houses were not considered adequate. It was recommended that the steel clamps that were used as ties between the walling units should receive adequate treatment.
According to the development group, the design was modified by the incorporation of a dampproof course into the walls, but not to the floor, although in the reinstatement work being carried out by the city of Birmingham no fewer than two dampproof membrane courses are being put into the floors of the council-owned properties where there were none already, because if water penetrates it will act upon any remaining sulphate. That is done after the whole depth of soil, sometimes to a depth of five or six feet, has been dug out to prevent the salts from developing and acting chemically.
I apologise, Mr. Deputy Speaker, for this technical and possibly boring recital. The subject is not boring to my constituents, to my hon. Friend, or to the hon. Members who have had to deal with the pitiful cases of many tenants. I wrote to each of the 119 tenants concerned. I wrote several letters as the refurbishing progressed. I must congratulate the city of Birmingham on dealing with the anxieties point by point. Tenants were worried about whether their carpets would fit, whether their fittings could be replaced, and where their furniture would be stored. They were frightened about being decamped from the property for three months or more, and returning to it subsequently. They were worried about many things, but every point was dealt with.
We cannot give the same guarantees to the owners because they have not the same redress. I have therefore pressed my hon. Friend the Under-Secretary of State on previous occasions to make available to them the same facilities made available following the case made out by my hon. Friend the Member for Lichfield and Tamworth (Mr. Heddle) in respect of Airey houses. That case was allowed because a structural design fault was found and a question of safety arose. Generous grants of 90 per cent. were made available to the owner-occupiers in that case. I therefore ask Ministers once again to consider this and to make the same generous Exchequer-funded grants to those who have purchased and who have no redress, to those who cannot get insurance, to those who wish to retire—they are all old and many have lived in the properties for more than 30 years—and to those who cannot retire and move because they cannot sell because even perfectly adequate properties are blighted by reputation. I therefore ask that the same scheme be made available to the owners of Smith houses because the same position obtains.
Timber window sashes were used and dampproof courses installed. I have had hundreds of letters from owners and tenants who were worried sick about this.
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They have been patient and calm throughout the bewildering process of seeing properties decay and collapse around them. That is no exaggeration. There are different dimensions to the problem. There are houses that look, and virtually are, untouched, there are those that have cracks that must be dealt with, there are those that are in an extremely bad state, in which walls are moving and floors heaving, and some that are fit only for the bulldozer.
My constituents in the Radleys, Willaston Road, Hazeldene Road, Elmstead Avenue, Wensley Road, and Wychwood Crescent are perturbed if they have bought their homes. I received a letter today enjoining me to love my neighbour, saying that that was the greatest of all things. But it is difficult to love one's neighbour when £3,000 or more, and in some cases £10,000, is being spent on the neighbour's house because he is a tenant, when that house is being ripped apart and the support walls replaced and the owner of the adjoining house has to suffer all the noise of the pneumatic drills ripping the floor up, and when, as Mrs. Wright of the Radleys says, water used to mix cement in the tenanted house under repair washes through the wall causing dampness and damage to carpets. It is difficult to love one's neighbour when that neighbour is having two damp courses put in so that the water shifts underneath to the owner-occupied house next door. It is difficult to be a good neighbour when the insurance company that always comes round after the fire to offer a caravan refuses to underwrite the insurance in this case.
Time does not permit me to mention all the design faults—in the thicknesses, the blocks, the movement of the blocks, the tensile life of the concrete and many other matters. Therefore, I ask my hon. Friend to consider the basic human and moral problems involved. It is not just a case of let purchaser beware. It could involve patent law. It involves that which is discernible to the eye and that which is not discernible. The houses are traditional in appearance, and many assume that they are so. I hope that the Minister will take steps to ensure that whatever is necessary to be done, is done. There should be remuneration. If necessary, we should have a mini Falklands campaign in housing refurbishment. These, and other houses could be refurbished and people could be employed.
I ask my hon. Friend to consider the proposition put to him, I understand, by the city of Birmingham. It is prepared to undertake the work, to apply for special repair grants and to get the 90 per cent. grant available. I hope that the Minister will consider that or any other feasible option. I ask him to consider our constituents, who are in a difficult plight.
1.20 am
The Under-Secretary of State for the Environment (Sir George Young): The House is grateful to my hon. Friend the Member for Birmingham, Yardley (Mr. Bevan) for raising this topic and giving us the benefit of his technical skills in explaining the real problems facing his constituents. I am pleased to see the Under-Secretary of State for Transport, my hon. Friend the Member for Birmingham, Hall Green (Mr. Eyre), in his place. He has been in constant contact with me and my hon. Friend the Minister for Housing and Construction on this issue. I am also pleased to see the hon. Member for Birmingham, Stechford (Mr. Davis), who has also been championing his constituents' case.

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The three hon. Members, and the hon. Member for Birmingham, Northfield (Mr. Spellar), had a meeting earlier this afternoon with me and my hon. Friend the Minister. They made it quite clear to us that there are a great many people who have bought Smith houses from Birmingham city council, who are now desperately anxious because of the serious cracks that have appeared in the walls of their houses. No one could have done more to further the interests of their constituents than those four hon. Members. Of course the Government fully understand the anxiety of those families and their wish to see this matter resolved as soon as practicable. My hon. Friend the Member for Yardley has taken us through the history, and I shall not repeat it.
Initially it was felt that the problem was confined to the shale fill under the foundations, but more recent investigations by the city council suggest that the problem is not restricted to that. Some cracking has been found in the walls where there is no apparent movement of the foundations. It seems that large blocks of the type of which the Smith house is constructed are very sensitive to stress from whatever source, whether it be movement of the foundations or thermal or moisture movement. The precise cause of the problem, and the remedial works appropriate to any particular case, have not yet been clearly established.
The problem is not, on present evidence, related to the deterioration of reinforced concrete because of carbonation of the concrete or the presence of chlorides, as has been found, for example, in Airey and Orlit houses. But the Smith house is unusual and the problem is technically complex, and we have therefore asked the Building Research Establishment to examine the technical evidence and to identify the cause of the cracking that has now been found.
The House will inderstand that the BRE's investigation, which will involve inspection of houses on site, will take some time to complete, but we shall make available the findings of that investigation as soon as it is completed and as soon as we have sufficient information to be confident technically about the results. I know that every day that goes by prolongs the anxiety for private owners who cannot, with confidence, invest in the maintenance, improvement or repair of their property, who may not know what, if any, repair is required, and who, if they wanted to move, might find the property unsaleable. But before the right course of action can be agreed, we have to have the technical facts of the matter. The problem is complex and it is in everyone's interests to await the BRE's considered appraisal of the problem rather than proceed now with action that might, with hindsight, prove ill-advised.
I know that Birmingham city council is already engaged on its own appraisal of the problem and the Building Research Establishment will be working closely with the city council in its investigation. I know, too, that Birmingham city council is sympathetic to the problems faced by owner-occupiers and is prepared to help them in a variety of ways. For example, I gather that where repair is required in some cases the city may be willing to include an owner-occupier's house in its own programme of repair on the basis that the costs will be reimbursed and that the
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city would temporarily rehouse an owner-occupier in a rented property if he had to leave his home while the repair works were in progress.
My hon. Friend pressed me on the possible extension of the scheme that we brought in for private owners of Airey houses. I hope that he understands that I cannot today add to what my hon. Friend the Minister for Housing and Construction said in the House on 8 February. On the evidence available, the combination of circumstances that exist in the Smith houses are not the same as those that were thought to justify financial assistance for owners of Airey houses, but we shall carefully consider the findings of the current investigation into the Smith houses and assess their implications as soon as possible.
Mr. Bevan: Will my hon. Friend be good enough to tell me when the information will be available to us so that we may consider its implications?
Sir George Young: We hope that the exercise that I described a few minutes ago might be completed by May. As my hon. Friend the Minister said in the meeting this afternoon, we shall take steps to make the information available to interested parties as soon as we have it in a suitable form. We understand the urgency and the anxiety of owners to see the problem resolved.
I hope that I have convinced my hon. Friend the Member for Yardley that we are worried about what is happening in Birmingham, that the technical investigation is now under way and that we have the matter in hand. Ministers will take whatever action is felt to be necessary as soon as possible. We shall, of course, keep informed those hon. Members who represent Birmingham.
Mr. Terry Davis: Before the Minister finishes will he bear in mind the fact that two other groups are affected; not only those owner-occupiers whose houses are showing signs of cracking, damp or stress but those who have been affected even though their houses appear to be perfectly all right because they are having great difficulty in selling their homes? They are tied to their homes in Birmingham and that can be very distressing if they want to move to other parts of Britain—for example, for employment.
Secondly, there is a problem with the city council because it would be unfair if the council tenants in the rest of Birmingham were forced to pay for the cost of the necessary works on the council-owned properties if the owner-occupiers were compensated. That would be inequitable as between tenants and owner-occupiers. Will the Minister give an assurance that he will bear in mind the interests of all groups?
Sir George Young: Of course, there are financial consequences to the city council if it has to carry out a programme of repair and improvement. We should take that into account in the HIP allocation for Birmingham city council next year. The incidence of these houses is relatively small compared with the overall stock of local authority accommodation in Birmingham, so I hope that the impact will not be devastating. However, we shall bear all points in mind. There is a blight on the properties and we should have to address ourselves to that when we decided what, if any, scheme ought to be introduced. It is the owners of those properties that we are most worried about.

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It being after Ten o'clock and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
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Adjourned at twenty-eight minutes past One o' clock.