Commons Sitting of 30 March 1983

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

    Employment
    Mr. Russell Johnstonasked the Secretary of State for Scotland what increase in employment he expects in Scotland in the fiscal year 1983–84 as a result of the Budget.
    Mr. William Hamiltonasked the Secretary of State for Scotland what estimates he has made of the consequences on job and industrial investment prospects in Scotland of the recent Budget proposals.
    Mr. Douglasasked the Secretary of State for Scotland if he will make a statement on the likely effects of the Chancellor of the Exchequer's Budget proposals on the prospects for future growth in the Scottish economy.
    The Secretary of State for Scotland (Mr. George Younger): Given the extent to which the Budget proposals will benefit industry, directly and indirectly, they will improve the prospects for economic growth, industrial investment and jobs in Scotland.
    Mr. Johnston: Is it not plain that that is not the case and that the Government's policies offer no opportunity to reduce unemployment? Will the Secretary of State be direct with us instead of leaving the matter to his surrogate undertakers, MacGregor and Atkinson, and say categorically whether Ravenscraig is to continue as a fully integrated steel plant?
    Mr. Younger: I should have thought that the hon. Gentleman would recognise that the reduction in the national insurance surcharge, the extra help for small businesses, the construction industry and the oil industry and, what is more, a further reduction in the bank rate, are bound to be helpful for jobs in Scotland.
    With regard to Ravenscraig, the Government made their position crystal clear in a statement on 20 December, and any major departure from the instructions that were given to the British Steel Corporation will have to be referred back to the Government.
    Mr. Hamilton: Will the Secretary of State admit that there will be a further dramatic increase in unemployment
    326
    in Scotland in the rest of the current financial year and that that will not allay anxiety about the future of the steel, coal and railway industries? Moreover, does he recognise that the number of bankruptcies of small firms has reached an all-time record since the Government took office?
    Mr. Younger: There will be no dramatic increase in unemployment during the current financial year, because it finishes in about five days' time. With regard to the more serious part of the hon. Gentleman's question, no one in any Western European country can forecast in present circumstances that there will not be an increase in unemployment of some type, even in the months ahead. I am sure that the hon. Gentleman recognises that the Budget and all the other measures that the Government have taken have made massive efforts to ease the difficulties of unemployment.
    The hon. Gentleman must recognise that none of the publicly owned industries that he mentioned would have a chance of existing today if it were not for the vast sums of money that the Government have found to help them through the recession.
    Mr. Douglas: Will the Secretary of State come clean about young people being unemployed? What hope can he give that important sector of the population who, come a year's time, will find that jobs are not available for them, even if they have undertaken strenuous educational and training activity? They want real, purposeful jobs, riot the phony economic prospectus that the Government are offering.
    Mr. Younger: I share the hon. Gentleman's anxiety about unemployment among all people, and especially among young people. However, he cannot shrug of his responsibility, as he supported a Government who did a great deal to destroy the companies on whose markets we depend for our jobs and have found recently that competition from overseas has taken many of their markets. Surely the hon. Gentleman is able to tell young people that not only are there better training facilities for them than there have ever been, but that there are tremendous opportunities in high technology industries in his own area, for example, in which they can take jobs from now on.
    Mr. Ancram: Does my right hon. Friend agree that the best prospects for secure and long-term employment in Scotland lie not with the high-spending proposals of the Labour party, but in creating the right climate that will attract new and lasting industries to Scotland, and that that is what the Budget has done?
    Mr. Younger: I agree that even a cursory reading of the document that the Labour party produced yesterday makes it quite clear that the increase in taxation and interest rates that its vast spending programme would require would probably put a large number of Scottish companies out of business because of the burden on them.
    Dr. J. Dickson Mabon: s the Secretary of State telling us that the Budget provisions for an increase in unemployment of about 300,000 will not affect Scotland and that we shall not suffer an increase in unemployment, or is he saying cautiously that there will be an increase in unemployment?
    Mr. Younger: I did not say that cautiously. I said it plainly a few moments ago. The right hon. Gentleman must recognise, because his knowledge of economics is

    327
    much better than that of many hon. Members, that the way to deal with unemployment is to ensure that our businesses can recapture the markets that they lost while under the control of the Government of which he, alas, was a member.
    Mr. Millan: Is the Secretary of State aware that he made a statement earlier this week, with which we all agree, that the MacGregor plan for Ravenscraig, with its loss of 2,000 jobs,
    "is an extraordinarily unattractive proposition"?
    Does he stand by that? If so, will he assure the House that he will not agree to or acquiesce in such a plan? If the Government accept such a plan, is he aware that he will not have an ounce of credibility left and he should resign?
    Mr. Younger: The right hon. Gentleman calls for my resignation about three times a week. I am happy for him to continue to do that for the next five years. I have made it clear that any major departure from the instructions given by the Government to the British Steel Corporation on 20 December must come back to the Government. No such proposal has been put to me by Mr. MacGregor or by anyone else, and during my discussions about steel during the past week no one has suggested to me that I should refuse to consider any plan produced for the future.
    Mr. Milan: We know what is in the MacGregor plan. Does the Secretary of State stand by his statement that the plan
    "is an extraordinarily unattractive proposition"?
    Mr. Younger: Those words were put into my mouth. If the right hon. Gentleman knows the MacGregor plan details, he is one up on Mr. MacGregor, who does not know either. It was made clear to me by Mr. MacGregor that he has no specific plan arranged with anyone on the other side of the Atlantic. If and when he has, both the right hon. Gentleman and I must consider it.
    Sir Hector Monro: Has my right hon. Friend had a chance to consider the "no hope" document published by the Socialists yesterday, and has he considered the likely rise in unemployment should that document be implemented, because of increasing taxation, interest rates and inflation?
    Mr. Younger: I have made an initial study of that document, which is amazing in its ignorance of the basic requirements for the success of the Scottish economy. I agree with my hon. Friend's examples, but a much greater one is that the Labour party's commitment to withdraw from Europe would put thousands of Scottish jobs in mortal peril of being destroyed for ever.

    Unemployment Statistics
    Mr. Robert Hughesasked the Secretary of State for Scotland what is the latest number of unemployed in Scotland; and if he will make a statement.
    The Under-Secretary of State for Scotland (Mr. Alexander Fletcher): On 10 February 1983, seasonally adjusted unemployment in Scotland stood provisionally at 316,900 persons, an unemployment rate of 14·6 per cent. The rate of increase in unemployment has slowed down during the past year, which shows, with other evidence, that our economic strategy is having effect. My right hon. and learned Friend the Chancellor in his Budget speech announced further help for the unemployed as well as various measures to assist industrial growth.
    Mr. Hughes: Will the Under-Secretary of State confirm that while he has been in office 192,000 more people have joined the unemployment queue in Scotland, representing for every miserable day of his existence, including Saturdays, Sundays and public holidays, 260 people with no hope of work? For how long will he preside over the shamful destruction of the future of Scottish people, and when will he adopt an alternative policy of hope and expansion?
    Mr. Fletcher: My right hon. Friend and I have said several times that we deplore the high rate of unemployment in Scotland, but, unlike those of the Labour party, our policies are aimed at reducing unemployment. The Labour party policy document published yesterday would increase unemployment in Scotland by several hundred thousand, because of the withdrawal from Europe and further nationalisation.
    Mr. Grimond: Does the Minister agree that as the consumption of whisky is falling and unemployment in distilling is increasing, this is an especially lunatic moment to increase whisky duty?
    Mr. Fletcher: The increase in duty is well below the level of inflation during the past two years. The whisky industry has not been treated badly in this respect, and more recently it has benefited by about £100 million through measures agreed by the Chancellor.
    Sir Russell Fairgrieve: Is it not true that since the end of the second world war every time a Labour Administration held office unemployment was higher when they left office than when they entered? Does my hon. Friend see any reason why that should change in the foreseeable future?
    Mr. Fletcher: My hon. Friend is correct. The policy document published yesterday shows that Labour has learnt nothing from its mistakes.
    Mr. Gordon Wilson: Does the Minister agree that the only word that can apply to the impact of the Government's economic policies during the past four years is "disaster"? If he is criticising the Labour party for planning to spend many billions of pounds that it does not have and must borrow from abroad, would it not be appropriate for him to press the Treasury to give back the £7 billion or £8 billion of oil revenues that Scotland needs and deserves to have attributed to it?
    Mr. Fletcher: Scotland benefits a great deal from the nation's oil revenue.
    Mr. George Robertson: Is the Minister aware that unemployment in Lanarkshire is now almost one in four of the adult population, and that leaflets are circulating in my constituency claiming that the saving of Ravenscraig was a triumph for Lanarkshire, Scotland and the Conservatives? Will he now answer my right hon. Friend's question? If the MacGregor plan comes before Ministers and it suggests the destruction of the strip mill at Gartcosh as part of a deal with the Americans, will the Secretary of State reject that plan, or will he resign?
    Mr. Fletcher: As my right hon. Friend said, if a proposal comes before the Government it will be considered carefully, as the right hon. Member for Glasgow, Craigton (Mr. Milian) said he would do. He believes that no Government could refuse to consider any proposal to increase the performance of the British steel

    329
    industry. However, Ministers must decide the future of Ravenscraig, along the lines of the MacGregor plan that is currently being discussed in the newspapers.

    Diabetes (Treatment)
    Mr. Gourlayasked the Secretary of State for Scotland when it is proposed that treatment for all types of diabetes will be provided in Scotland; and if he will make a statement.
    The Under-Secretary of State for Scotland (Mr. John MacKay): The treatment of diabetes, in all its usual forms, is provided in Scotland at teaching and district general hospitals and, where appropriate, by family doctors.
    Mr. Gourlay: Is the Minister aware that my question refers to a 23 year-old constituent who suffers from a form of diabetes that is, as far as we know, the only such case in Scotland? If my constituent does not receive this treatment, which has already been tried unsuccessfully in Scotland, in Vienna, the cost to the health board will be thousands of pounds, because she will require regular hospital treatment costing £600 a week? Will the Minister reconsider this case and provide the money necessary to enable my constituent to live a normal life?
    Mr. MacKay: This patient suffers from an extremely rare form of brittle diabetes, where only the new method currently being assessed in Vienna has any likelihood of controlling her insulin-sugar balance. National Health Service facilities are limited to the United Kingdom, and the National Health Service (Scotland) Act 1978 does not enable the NHS to pay for a Scottish patient going abroad for treatment. I understand that funds are being provided by the friends of the hospital, the local rotary club and Fife health board endowment funds to allow the patient to go to Vienna. I hope that the treatment that she receives there will work.
    Mr. Corrie: Is my hon. Friend aware that some distress has been caused to those who suffer from diabetes because of the non-availability of disposable syringes? Will he consider this problem, because many youngsters find it difficult to handle glass syringes and would find disposable syringes much easier?
    Mr. MacKay: I have considered the problem on more than one occasion. For youngsters, disposable needles that are essential on medical grounds can be supplied through a hospital. If they were not, we would not be justified in diverting the necessary expenditure from other Health Service priorities to give disposable needles to every diabetic.

    Fraserburgh and Peterhead (Unemployment)
    Mr. McQuarrieasked the Secretary of State for Scotland what steps he is taking to alleviate unemployment in the engineering and fish processing factories in Fraserburgh and Peterhead.
    Mr. Alexander Fletcher: A wide range of incentives are available for industrial development. These include tax incentives, schemes to back innovation in product development and numerous measures to assist small firms. Moreover, the fish processing industry may be eligible for grant support from the European Community under its FEOGA provisions.
    Mr. McQuarrie: That is a most unsatisfactory reply. Is my hon. Friend aware that 26·1 per cent. of the employable male workers in Fraserburgh are unemployed and that in the fish processing factories shifts are being laid off because there is no work for them? With the greatest respect to my hon. Friend, the facilities may be available, but they are not being used. Will he instruct his officials to do something in my constituency so that we can have action rather than words?
    Mr. Fletcher: My hon. Friend is aware that action is being taken in his constituency, and I have to disagree with him about the FEOGA grants, because considerable sums are being invested in fish processing. For example, during 1982–83 applications for grants from FEOGA involved planned expenditure in Scotland of £10·5 million.
    Mr. Myles: Is my hon. Friend aware that, just along the coast from Fraserburgh, in the town of Buckie, a fishing boat building yard, after being closed for two years, has reopened with orders for new vessels, and also that two fish processors in that town, Cox Fish and Moray Fish, are each taking on 50 or 60 extra employees?
    Mr. Fletcher: It would seem that my hon. Friend's constituents are faster on the draw than the constituents of my hon. Friend the Member for Aberdeenshire, East (Mr. McQuarrie).
    Mr. Robert Hughes: Is the Minister aware that just along the coast, in the other direction from Buckie, the Government's settlement of the common fisheries policy has done nothing to help fishermen and that throughout the whole of the north east of Scotland there is great dismay, shared by the hon. Member for Aberdeenshire, East (Mr. McQuarrie), over the disgraceful way in which the Government have treated the economy of the Grampian region?
    Mr. Fletcher: I am rather confused about the question. However, the fishermen fully supported the agreement reached with the assistance of my right hon. Friend the Minister of Agriculture, Fisheries and Food.
    Mr. McQuarrie: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of that reply I beg to give notice that I shall seek to raise this matter on the Adjournment at the earliest opportunity.

    Teacher Training
    Mr. O'Neillasked the Secretary of State for Scotland when he plans to meet the principals of colleges of education in Scotland to discuss the future of teacher training in Scotland.
    Mr. Alexander Fletcher: My right hon. Friend has no immediate plans for such a meeting. My Department is, however, in constant touch with the principals about all aspects of teacher training.
    Mr. O'Neill: What assurances can the Minister give to the principals of Craigie, Dunfermline and Dundee colleges of education that they will not be closed, as each of the colleges recorded costs per student in 1981–82 that were higher than those per student at Hamilton college and Callendar park college, both of which had to be closed for economic reasons?
    Mr. Fletcher: The reason for the closure of the colleges was not, as the hon. Gentleman suggests, the unit

    331
    cost, but that there was, as the hon. Gentleman is fully aware, lessening demand for school teachers. We have no proposals to close the colleges to which he referred.
    Mr. Maxton: Will the Minister take into account, when looking at the future of the colleges for further education, the working party that he has set up on primary pre-service training? Will he tell the House that he will appoint a member from the Association of Lecturers in Colleges of Education in Scotland to the committee, as it represents all the lecturers and principals in colleges of education? As they are the people who have to teach these courses, do they not have a right to say how the courses should be set up?
    Mr. Fletcher: We believe that the colleges are properly represented on the committee.
    Lord James Douglas-Hamilton: In view of my hon. Friend's reply that there are no proposals to close colleges of education, will he confirm that no further colleges of education will be closed?
    Mr. Fletcher: I cannot accept my hon. Friend's words. I said that we had no proposals at present for any colleges closures, but we cannot tell what the position might be in five or 10 years' time.
    Mr. Michael Martin: Will the Minister include in the colleges of education, colleges of engineering, and ensure that every support is given to them to ensure that apprenticeships are given and kept up to date with the changes in industry and technology?
    Mr. Fletcher: Much change is taking place in the engineering industry and in apprenticeship training, as the hon. Gentleman suggests. These matters are being revised.

    Ayrshire and Arran Health Board (New Laundry)
    Mr. Lambieasked the Secretary of State for Scotland when it is proposed to start the construction of a new laundry in north Ayrshire for the Ayrshire and Arran health board; and if he will make a statement.
    Mr. John MacKay: The board is considering a number of alternative methods of providing laundry facilities in north Ayrshire. I hope to receive its proposals shortly.
    Mr. Lambie: Why has the offer from Irvine development corporation to rent or sell one of its many empty factories to be completed as a laundry not been accepted by the Ayrshire and Arran health board? Is it because the Minister's right hon. Friend, the Secretary of State for Scotland, has an interest in Ayrshire and wishes one of his political industrial friends in north Ayrshire to provide laundry services to the hospitals of North Ayrshire as a first step in the privatisation of health services in the Ayrshire and Arran health board area?
    Mr. MacKay: The last part of the hon. Gentleman's question was unworthy of him and was an unwarranted slur on my right hon. Friend. I deplore the time that the health board has taken over this matter. It has a number of options to look at and I hope—I have made my view clear to the board chairman—that its proposals will come to me soon.
    Mr. Foulkes: Will the Minister come clean and admit that he and his right hon. Friend are pushing the Ayrshire and Arran health board into privatisation, not just of the
    332
    laundry service, but of the meal and cleaning services? Are not these three services in hospitals far too important to leave to private enterprise when so many of the companies which might carry them out are going bust because of the Government's economic policy?
    Mr. MacKay: The health board is considering various options, including the building of a special laundry and the option mentioned by the hon. Member for Central Ayrshire (Mr. Lambie), and contracting out laundry work. It must be obvious to any sensible person that if contracting out is the most economic way to carry out the services it is for the benefit of the patients and the taxpayers that that is done so that as much of Health Service resources as possible are directed to patient care, or, in the words of the hon. Member for Central Ayrshire to my right hon. Friend the Prime Minister, to help with much needed facilities for psychogeriatric and geriatric care in south Ayrshire. I should have thought that that was the sensible way, unlike the dogmatic approach of the Labour party.
    Mr. Corrie: If a private company offers a laundry service, will my hon. Friend support that company in doing the work for the health board?
    Mr. Mackay: I assure my hon. Friend, and I have made it clear, that sound common sense is needed in the use of public money. I should expect the health board to look at all the options available, and if contracting out is the most economic way to deliver the service, common sense would tell us all that that is how it should be done.

    Glasgow (Geriatric Beds)
    Mrs. McElhoneasked the Secretary of State for Scotland how many geriatric beds there are in Glasgow.
    Mr. John MacKay: In March 1981 there were 2,262 hospital beds for geriatric patients in the Greater Glasgow health board area. In addition, 2,566 beds for the elderly were provided in residential accommodation by local authorities and voluntary bodies.
    Mrs. McElhone: What assurances can the Minister give me that the geriatric hospital that has been shelved for three years in Rutherglen will go ahead with the 240 proposed new beds? Does the Minister realise that in the south eastern district of Glasgow there are nearly 230,000 people, 20 per cent. of whom are over 60, but only 350 geriatric beds to serve them?
    Mr. MacKay: The most recent estimates show that Greater Glasgow has slightly more beds than set out in the formula of 40 beds per 1,000 for people aged 75 or over. I agree that there is a problem of both the quality and location of beds in Glasgow. I am sure that the hon. Lady will be pleased to hear that my Department has approved schemes at both Rutherglen and Gartloch hospitals for 120 beds at each, which will lead to an improvement in geriatric and psychogeriatric provision in the area.
    Mr. Craigen: In assessing provision for the elderly in the Glasgow area, how closely does the Minister liaise with his housing colleague in the Scottish Office on the provision of sheltered accommodation?
    Mr. MacKay: Sheltered accommodation is an important part of the whole spectrum of care for the elderly. The Government have given money to the housing

    333
    associations, which has allowed them to build sheltered housing at a faster rate than ever before. I very much hope that that progress will continue, because sheltered housing is a splendid way of keeping the elderly active and in the community.
    Mr. Dewar: Will there not be a frightening shortfall of provision, not just in the hospital service, but in the geriatric service in the community? Is the Minister not upset and distressed by the fact that there have been so few jointly financed projects between local government and the health boards in Scotland? Would it not be better to do something about that scheme—thus getting away from the disadvantages met by local authorities in relation to the financial attractions of such a scheme, as against their counterparts in England—than to threap on about the ideological advantages of privatisation in the Health Service, as the hon. Gentleman has been doing for the last three or four minutes?
    Mr. Mackay: As the hon. Gentleman knows, at a meeting with the Convention of Scottish Local Authorities I discussed the whole question of the support finance scheme. I am considering ways in which that scheme can be improved. I am pleased to tell the House that in the coming financial year we are allocating £3·6 million to that scheme—a considerable increase over last year and a huge increase compared with the figure under the Labour party.

    Forestry Plantings
    Mr. Corrieasked the Secretary of State for Scotland what acreage of forestry has been planted in Scotland by the Forestry Commission and by private forestry groups over the past two years where figures are available.
    Mr. Younger: In the year ended 31 March 1981, 10,481 hectares were planted by the Forestry Commission and 7,074 hectares by private growers. In the year ended 31 March 1982, 10,094 hectares were planted by the commission and 10,743 hectares by private growers. These figures are for new planting only and do not include restocking. Separate records are not held centrally of the planting undertaken by the forestry groups.
    Mr. Corrie: I thank my right hon. Friend for that reply, which vindicates Government policy. To make absolutely sure that jobs are kept in this country, and to make use of all the timber grown both now and in the future, will he ensure that any major developments for the processing of timber will be located in Scotland, so that jobs can be developed there to support this vital industry?
    Mr. Younger: I fully appreciate my hon. Friend's concern, although the interesting new development at Shotton in north Wales is of considerable benefit to the general timber market and should have beneficial effects on the market in Scotland. It is good to report that Messrs. Caberboard Ltd. is running its timber-using plant near Stirling well and has also reconstructed the firm in Irvine—previously Scotboard—which is now making a useful contribution to the use of timber in Scotland.
    Mr. Maclennan: Does the right hon. Gentleman believe that there is a future for a pulp industry in Scotland?
    Mr. Younger: There is a great future for a timber-using industry in Scotland. The Government are doing a
    334
    great deal—including the commissioning of the Arthur D. Little study through the SDA—to make sure that Scotland is ready to take full advantage of that.
    Mr. Home Robertson: What area of forestry land has been sold off by the Forestry Commission in Scotland since the Forestry Act 1981 came into force? How much money has consequently been siphoned out of Scottish forestry and into the coffers of the Chancellor of the Exchequer?
    Mr. Younger: Between the passing of the Act in 1981 and 21 February 1983, approximately 1,034 hectares—775 hectares in Scotland—of land awaiting planting were sold by the commission, and the total amount of land that has so far been sold is about 90,000 hectares—[HON. MEMBERS: "Shame."] Let me correct that figure. The total is 9,300 hectares being planted for the current year, with more than 8,000 hectares being planted in Scotland. It is expected that in future the private sector will do considerably more planting than the public sector. As the hon. Gentleman knows, all the money is ploughed back into the forestry industry.
    Sir Russell Fairgrieve: Does my right hon. Friend appreciate that, at about £10 million a day, timber and timber imports have virtually become the United Kingdom's largest import bill? As Scotland can make a major contribution, will he do everything to ensure a far greater planting effort in both the private and public sectors in Scotland?
    Mr. Younger: I entirely agree with my hon. Friend. It is for that reason that the Arthur D. Little study has been put into effect. As a result of that, the Scottish Forest Products Development Group has been established to seek and encourage investment in future forest products in Scotland. That is exactly in line with what my hon. Friend suggested.
    Mr. O'Neill: How much in excess of the undertakings given at the time of the 1981 Act are the figures given by the right hon. Gentleman? Are they not greatly in excess of what we were led to believe would be the maximum level of privatisation of forestry land?
    Mr. Younger: Not at all. The figures are pretty well on target with the undertakings given to the House when the sales programme went ahead. I am confident that that will continué over the rest of the programme.

    Scottish Development Agency
    Mr. David Marshallasked the Secretary of State for Scotland if he has any plans to privatise or sell off any of the activities currently run or owned by the Scottish Development Agency.
    Mr. Alexander Fletcher: It is the Government's intention that the agency should continue to secure private sector participation in its activities and dispose of assets in accordance with its guidelines.
    Mr. Marshall: Will the Minister give an absolute assurance that private enterprise money introduced into SDA ventures, such as the construction and letting of industrial estates, will not become a Trojan horse, whereby once the estates are fully let they will be sold off to the private enterprise partner at rock-bottom prices?
    Mr. Fletcher: There is no suggestion of anything being sold off at less than market value. The hon. Gentleman

    335
    will be pleased to know that the funds coming to the agency from private disposals help to generate new investment.
    Mr. Ancram: Does my hon. Friend agree that the main purpose of the SDA should be to promote and assist industry to stand on its own two feet and that it should not be a backdoor method of nationalisation and state monopoly?
    Mr. Fletcher: On the contrary, the agency's functions are to work in partnership with the private sector, as I think my hon. Friend is suggesting, and to secure the maximum amount of private sector participation in its activities.
    Mr. Ron Brown: Will the Minister allow the SDA to take over the Bonnington mills rather than John Smart and company, which has a vested interest in the area and supports the Tory party, having given it £30,000 in 1981 and £40,000 last year?
    Is it not important that public inquiries should be a democratic feature of our country? Why should the SDA not have a right to intervene in such a case, about which the Minister is well aware as it is in his constituency?
    Mr. Fletcher: I think that the hon. Gentleman is referring to a private housing development, in which the SDA does not involve itself.

    Construction Industry
    Mr. Tom Clarkeasked the Secretary of State for Scotland how many people were employed in the construction industry in Scotland in each of the past four years.
    The Under-Secretary of State for Scotland (Mr. Allan Stewart): The number of people employed in the Scottish construction industry in September of each of the past four years was 163,800 in 1979, 157,200 in 1980, 137,600 in 1981, 127,300 in 1982. These figures are estimates and do not include the self-employed, for whom information is not available.
    Mr. Clarke: In view of those disgraceful figures, may I ask how many unemployed construction workers appeared in the pre-election poster whose caption was "Labour isn't working"?
    Mr. Stewart: I shall endeavour to answer the serious issue which I think underlies the hon. Gentleman's question. Although the industry has been through a difficult period, there are now definite signs of recovery. Housing starts rose by over 20 per cent. in the first nine months of last year compared with the same period in 1981 and new construction orders rose by a similar percentage. Construction output has clearly begun to recover.
    Mr. Henderson: Does my hon. Friend agree that there would be better prospects still for the construction industry if local authorities spent more wisely on current account so that more money was available for capital investment?
    Mr. Stewart: I entirely agree with my hon. Friend. It is deplorable that Scottish local authorities are forgoing so much capital expenditure on housing in the current financial year because of their expenditure under current headings.
    Mr. McKelvey: On a previous occasion the construction industry mounted a campaign called CABIN,
    336
    in which it expressed great support for the Conservative party and claimed that a Conservative Government would offer the only means by which the construction industry would be saved in Scotland. Has the Minister received any approaches from the industry along those lines and, since mounting the CABIN campaign, has it expressed any regrets that the promises made by the Government have not come to pass?
    Mr. Stewart: No, but I am confident that at the next general election the majority in the construction industry, as in other industries, will vote Conservative.
    Mr. Gordon Wilson: Does the Minister accept that it has been his controls over revenue spending which have, in effect, strangled the construction industry's prospects of development through capital spending? As the distinction between revenue and capital is not necessarily very effective in public terms, will he review his policies and allow capital spending to go ahead?
    Mr. Stewart: No. There has been constraint because local authorities have chosen to forgo substantial amounts of capital expenditure. I can assure the hon. Gentleman that public expenditure on construction in Scotland this year will be about £1,000 million.
    Mr. McQuarrie: Is my hon. Friend aware of the importance of capital expenditure in the housing construction industry? Will he assure the House that adequate funds will be made available for any requests that are made by local authorities for the removal of dampness from local authority houses, this being a great problem in Scottish housing?
    Mr. Stewart: The Government are keenly aware of dampness and condensation problems and the hardship that they can cause. We very much welcome the interest that has been shown by the Select Committee. The responsibility is primarily with housing authorities, but I can assure my hon. Friend that individual housing allocations for 1983–84, which I expect authorities to receive tomorrow, will take full account of representations on dampness and condensation.
    Mr. Dewar: The Minister has talked about local authorities having chosen to forgo certain moneys in their capital programmes. Surely that is an unacceptable euphemism. In fact, local authorities have been viciously penalised and fined for refusing to increase rents to unacceptable and arbitrary levels that have been chosen at the whim of the Secretary of State. At a time of increasing housing need, high unemployment in the construction industry and a tidal wave of bankruptcies, is it not an insult to Scotland that over the past two years £80 million should have been taken from Scottish local authorities, which could have been put to good use in the house building programme?
    Mr. Stewart: I uttered not a euphemism, unacceptable or otherwise, but a statement of fact. The hon. Gentleman should be encouraging his friends in Socialist authorities to put capital expenditure first.

    Confederation of British Industry
    Mr. Ancramasked the Secretary of State for Scotland when next he plans to meet the Confederation of British Industry in Scotland to discuss the recovery of Scottish industry.
    Sir Hector Monroasked the Secretary of State for Scotland when he will next be meeting the Confederation of British Industry to discuss economic prospects in Scotland.
    Mr. Younger: I have no plans in the immediate future to meet the Confederation of British Industry in Scotland, though, of course, I do frequently meet confederation representatives both formally and informally to discuss Scottish industrial and economic matters.
    Mr. Ancram: When my right hon. Friend meets the chairman, will he discuss with him the latest survey of industrial trends, which shows clearly that Scotland is pulling out of the recession and that the Scottish economy is growing at about three times the rate of the economy of the United Kingdom as a whole? Does he agree that the only two things that can damage Scotland's chances are, first, a continuing and cynical misadvertisement by Labour Members that Scotland is an industrial wasteland and, secondly, the nonsensical and inflationary policies that were published by the Labour party yesterday?
    Mr. Younger: I agree with my right hon. Friend. I believe that the CBI has already had time to make some devastating comments about the document that was produced yesterday. I noted that in the CBI's latest survey of industrial trends in Scotland it is stated that the Budget is seen as broadly favourable to industry and that the changes in North sea oil taxation are likely to be greatly beneficial to industry in Scotland generally.
    Sir Hector Monro: Is my right hon. Friend aware that I had a stimulating meeting with the chairman of the CBI in Dumfries this week? Will he accept that the chairman was extremely confident that the Budget would do a very great deal for small industries and small businesses and provide much hope for the future?
    Mr. Younger: I am grateful to my hon. Friend. I am not surprised that he gained that impression from the chairman of the CBI. Its survey of the latest trends shows an expected increase in output over the next four months, which is the most optimistic survey since June 1979. It expects an improvement in export order books that will be stronger than at any time over the past three years, and a decline in the rate of destocking. This shows that there are better times ahead.
    Mr. Douglas: When the right hon. Gentleman next meets the Scottish CBI, will he explain the posture that he has taken on the Anderson Strathclyde takeover? Will he explain to it how his views conform with its views that we should keep decision-making centres in Scotland?
    Mr. Younger: I appreciate what the hon. Gentleman says. However, by far the most important thing for us all to do now is ensure that the company has every encouragement to continue prospering and that jobs are safeguarded. I find his concern about the matter somewhat interesting, when he supported a Government who, as a matter of policy, removed from Scotland the headquarters of many firms—Colville, Stewart and Lloyd, Yarrows, Scott-Lithgow and Fairfield, for example—and placed them in London. They were all deliberately moved from Scotland to London by the Labour Government. They have that wrapped round their necks.
    Lord James Douglas-Hamilton: Will my right hon. Friend discuss with the chairman of the CBI the
    338
    possibilities that will arise out of the creation of free ports in Scotland? Does he recognise that there is a case for a free port in the Forth estuary and for more than one free port in Scotland?
    Mr. Younger: I appreciate my hon. Friend's interest in free ports. As he knows, my right hon. and learned Friend the Chancellor of the Exchequer announced in the Budget statement that consideration would be given to the establishment of free ports. I am looking forward to receiving bids from places in Scotland which think they are suitable sites.
    Mr. Donald Stewart: In view of the sensitivity of the Anderson Strathclyde issue, may I ask what representations the right hon. Gentleman has made to his right hon. Friend the Prime Minister to the effect that he was not consulted on such a vital Scottish issue?
    Mr. Younger: If the right hon. Gentleman listened to the debate he will know that my right hon. Friend made it clear that under the statute the decision is taken personally by the Minister for Trade. My hon. and learned Friend did so and he explained it to the House.
    Mr. Millan: Is the right hon. Gentleman confirming that he was not even consulted about what happened? Does he accept that what happened on Friday was an example of City interests behaving in their most squalid fashion? The right hon. Gentleman, who has agreed that the takeover by Charter Consolidated is against Scotland's industrial interests, should be ashamed of himself for voting for the takeover last week.
    Mr. Younger: As I said to the hon. Member for Dunfermline (Mr. Douglas), the right hon. Gentleman should think carefully before he poses as the great champion of keeping headquarters in Scotland. He has taken more of them away from Scotland than all of us put together. He should be ashamed of that. He knows his legislation well enough to be aware that under the statutes my hon. and learned Friend is obliged to take the decision himself and to take into account the views of the Director General of Fair Trading as well as those of the Monopolies and Mergers Commission. My hon. and learned Friend clearly declared what he had done and the right lion. Gentleman should be aware of the procedure perfectly well. I am not taking any lectures from him about moving headquarters from Scotland. He has a black record on this score and he had better learn to live with it.

    Information Technology (Schools)
    Mr. Hendersonasked the Secretary of State for Scotland what progress is being made in the introduction of information technology in Scottish schools and colleges.
    Mr. Alexander Fletcher: Good progress is being made in the introduction of computers and other new technology into schools and colleges. The production of good quality software is a priority of the Scottish microelectronic development programme and in-service training is available. I announced in December 1982 the indefinite extension of SML)P and its development into a software house, information centre and research and development facility. Considerable sums have been made available this year for the provision of hardware in schools and colleges and for the development of high quality software.
    Mr. Henderson: How does the position in Scotland compare with that in England? Will my hon. Friend take this opportunity to compliment those teachers who have enthusiastically grasped the opportunities, and at the same time encourage those who have not yet become as friendly and at ease with microcomputers as so many of their pupils have?
    Mr. Fletcher: I do not know the exact comparison with England, but Scotland certainly got off to a smart start three years ago. I know that teachers are enthusiastic about the developments, but my hon. Friend is right to point out that in many cases pupils are ahead of them.
    Dr. Bray: Is the Minister aware that there is not much point in having information technology if the information is false? Is he aware that, contrary to Mr. MacGregor's statement to Ministers that the increased demand for steel is just a blip, the ordering rate for steel strip is being maintained and that already three strip mills in the United Kingdom can be profitably loaded?
    Mr. Fletcher: I am pleased to note the hon. Gentleman's views.

  SOLICITOR-GENERAL FOR SCOTLAND

    Bail etc. (Scotland) Act 1980
    Mr. Ancramasked the Solicitor-General for Scotland how many offences under the Bail etc. (Scotland) Act 1980 have been prosecuted by his Department in the last six months; and how this compares with the previous six months.
    The Solicitor-General for Scotland (Mr. Peter Fraser): The statistics for the number of persons against whom proceedings were taken in 1982 for contravening section 3 of the Bail etc. (Scotland) Act 1980 are not yet available. However, I can give details of the number of offences made known to the police in that year. In all, some 2,293 such offences were made known to the police in 1982, while the comparable figure for 1981 was 920.
    Mr. Ancram: Is my hon. and learned Friend aware of the growing anxiety in Scotland about the working of the Bail etc. (Scotland) Act 1980, both among the police and public and those who work in that area? Is it not time for a review of the criteria under which bail is allowed?
    The Solicitor-General for Scotland: I am aware that several chief constables in Scotland have expressed their anxiety about the operation of the Bail etc. (Scotland) Act 1980, but, as has been said, it is important to separate from that the working of that Act and the criteria to be applied when people are granted or not granted bail. That Act does nothing to alter those criteria and recently the Lord Justice-Clerk clearly laid down the circumstances under which people would be allowed bail.
    Mr. Dewar: I am grateful to the hon. and learned Gentleman for that answer. Does he agree that one of the aims of the Bail etc. (Scotland) Act 1980 was to try to cut down the number of accused being held in custody awaiting trial, but that that has not happened? Anyone who looks at the figures will see that the number of prisoners on remand has increased. Is that not as genuine a worry as some of the more flamboyant claims that are made in certain chief constables' reports?
    The Solicitor-General for Scotland: The hon. Gentleman is correct. In 1981, 664 people were on remand, while for 1982 the provisional figure is 649. It is important to understand that, while we want to allow bail wherever possible, we cannot allow a set of circumstances to exist whereby those who are on bail take that as an opportunity to commit further offences. That is why we gave a direction to procurators fiscal in Scotland last May.
    Mr. Gordon Wilson: In those cases where accused persons appeal to the High Court of Justiciary to obtain release from prison, will the Solicitor-General for Scotland say whether he has found any mechanism to allow those whose appeals are successful to be released immediately rather than have to wait until the next public day for release because of the problems caused by the non-money bail system?
    The Solicitor-General for Scotland: The hon. Gentleman raises an important point, which the hon. Member for Glasgow, Garscadden (Mr. Dewar) also raised. My noble and learned Friend the Lord Advocate is currently examining that matter and we hope that it will be possible to bring about some change in the arrangements to prevent that.

    Prosecution Policy
    Mr. Maxtonasked the Solicitor-General for Scotland if he will meet the procurator fiscal for Kirkcaldy to discuss prosecution policy.
    The Solicitor-General for Scotland: I have no immediate plans to meet the procurator fiscal at Kirkcaldy. My noble and learned Friend the Lord Advocate and I do, however, from time to time visit the offices of procurators fiscal to discuss matters with them.
    Mr. Maxton: When the Solicitor-General for Scotland does, perhaps some time in the future, get round to discussing prosecution policy with the procurator fiscal for Kirkcaldy, will he consider discussing with him the extension to Kirkcaldy of the tape recording of interviews of suspects? Will he also make a statement on why, after two years of experiments elsewhere, no report has come from his Department to explain to the House what is happening? Is that not a disgrace?
    The Solicitor-General for Scotland: I am grateful to the hon. Gentleman for that interesting question. As he will appreciate, tape recording and the experiments that are conducted by the police on that are a matter for my right hon. Friend the Secretary of State. We are closely observing those cases and trials where tape recordings are used before the courts. Recently there was an interesting decision on tape recording in the High Court at Aberdeen.
    Mr. Henderson: In his contacts with the procurator fiscal for Kirkcaldy, will my hon. and learned Friend take the opportunity to scotch the somewhat ill-informed rumours that have been going round that there might be some diminution of the activities of the sheriff court at Cupar?
    The Solicitor-General for Scotland: Yes, I am glad to do that. There is no truth in the rumour that there is an intention to close the sheriff court at Cupar. Much business is still being conducted there and it and the other sheriff courts in Fife are intact.
    Mr. Christopher Price: When the Solicitor-General for Scotland meets the procurator fiscal for Kirkcaldy, will he ask him to take a cheap day return to London and explain to the civil servants in the Home Office, and the Home Secretary in particular, the virtues of an independent prosecution system and ask the Home Secretary to include in the Police and Criminal Evidence Bill that excellent system for England, as recommended by the English Royal Commission on criminal procedure?
    The Solicitor-General for Scotland: From my limited experience in the House I know that from time to time one receives accolades from unexpected quarters. I shall certainly tell the procurator fiscal of the hon. Gentleman's respect and high regard for the system of independent public prosecutors that we have in Scotland. However, I think that the hon. Gentleman is aware that public prosecutors in England are being considered by the Home Secretary.
    Mr. David Marshallasked the Solicitor-General for Scotland if he has any plans to meet procurators fiscal to discuss prosecution policy and the administration of justice.
    The Solicitor-General for Scotland: I have no specific plans to meet procurators fiscal to discuss prosecution policy and the administration of justice. These are, of course, matters that I would discuss with fiscals as and when we meet.
    Mr. Marshall: When the Solicitor-General for Scotland eventually meets procurators fiscal what advice will he give to them in view of the persistent rise in crime figures in Scotland, which has been underlined by the official figures for the third quarter of 1982? Is not that record one of which he should be ashamed, in view of the promises on law and order made by the Conservative party during the last election campaign?
    The Solicitor-General for Scotland: No, that is not a matter of which the Government should be ashamed. Not only have the Government significantly increased the number of police in Scotland, but we have put on to the statute book the Criminal Justice (Scotland) Act 1980, which anyone who is truly concerned about the issue of law and order in Scotland will appreciate was a most important step forward.
    Mr. Canavan: In view of the recent prosecutions of people involved in peaceful demonstrations against nuclear weapons and the recent wise remarks of the learned sheriff, which were unfairly criticised by the unlearned chairman of the Scottish Tory party, will the Solicitor-General for Scotland tell his right hon. Friend the Secretary of State to resist the clamours of his warmongering friends in the Tory party and encourage all Scottish sheriffs to make regular peace-loving statements from their benches?
    The Solicitor-General for Scotland: As, in the course of the year, the hon. Gentleman has thought it appropriate to make particular criticisms of sheriffs principal for the political views that he alleged they have shown in the decisions that they have had to take, I should have thought that the hon. Gentleman was truly the last person to make any comments on this issue in the House.
    Mr. Maclennan: Is the Solicitor-General for Scotland satisfied that the public interest is adequately protected
    342
    where complaints against the police are made involving allegations of criminality and where the appropriate method of inquiry is by means of reference to the procurator fiscal? Will the hon. and learned Gentleman consider whether some other means of independent investigation of complaints against the police ought to be on the agenda?
    The Solicitor-General for Scotland: Complaints involving criminality against the police are not referred only to the procurator fiscal. They are also referred to Crown counsel and to either my noble and learned Friend the Lord Advocate or myself to make a final decision. It is interesting that the Select Committee on Home Affairs, when considering this issue involving England and Wales, made the recommendation that those south of the border should follow the procedure followed north of the border.

    Police and Criminal Evidence Bill
    Mr. Robert Hughesasked the Solicitor-General for Scotland what representations he has had from the Law Society for Scotland and Scottish law agents on clauses 53 to 56 of the Police and Criminal Evidence Bill.
    The Solicitor-General for Scotland: My noble and learned Friend the Lord Advocate has received three letters from the secretary of the Law Society of Scotland. I have received a letter from the secretary of the Scottish. Law Agents Society.
    Mr. Hughes: As a result of these representations, clause 53 of the Bill no longer applies to Scotland. I welcome the Solicitor-General taking account of those representations, but was there not a total failure on his part adequately to consult Scottish legal opinion before these measures were included in the Bill?
    The Solicitor-General for Scotland: No, I do not accept that at all. I am surprised that some of the representations that I have received have made no reference to the Criminal Evidence Act 1965, on which clause 53 is largely based, although it does not apply to public records. It is more appropriate to await the report from the Scottish Law Commission. It was against that background, and because of the representations that were received, that the Government sought to disapply this clause to Scotland.
    Later—
    Mr. Strang: On a point of order, Mr. Speaker. May I draw it to your attention that, while we have now passed the last Scottish Question Time before the House rises for the recess, the Secretary of State for Scotland has not yet made clear the Government's intentions with regard to the budgets of those local authorities which are in excess of the guidelines for the financial year which starts in a few days' time? There is immense concern in my constituency that we still do not know whether the Secretary of State intends to enforce further job cuts and reductions in services? May I put it to you—
    Mr. Speaker: The hon. Member for Edinburgh, East (Mr. Strang) knows that that is none of my business. It is a matter for the Minister.
    Mr. Strang rose—
    Mr. Speaker: Order. The hon. Gentleman has not so far submitted a point of order. Perhaps he will try to hang his remarks on to a point of order.
    Mr. Strang: My point of order is to seek your guidance, Mr. Speaker. Would it not be utterly reprehensible if an important announcement of this nature were made other than in the House of Commons?
    Mr. Speaker: That is another matter, on which I shall not comment.

Overseas Students (Awards)
3.30 pm
The Secretary of State for Education and Science (Sir Keith Joseph): With permission, Mr. Speaker, I should like to make a statement about awards to overseas students.
On 16 December last, the House of Lords ruled on the meaning of "ordinary residence" in relation to the entitlement of students from overseas to mandatory awards. The main effect is that students who were in this country during the three years before their period of higher education essentially for the purpose of taking a lower-level course of education may have been eligible for a mandatory award, subject to a means test on their parents' income. They were not so eligible under the "real home" test which formed the basis of the previous advice to local authorities by this and the previous Administration.
The cost to the taxpayers and ratepayers of this ruling could be substantial. Much of the benefit will go to students from overseas who have come here with no expectation of receiving support from British public funds. The Government's policy is to support selected students and countries under the aid programme and the programme announced by my right hon. Friend the Foreign and Commonwealth Secretary on 8 February. Other overseas students are welcome but are expected to pay their own way.
There will be no retrospective legislation, but the Government have decided to restore the position on mandatory awards to that which successive Governments thought and intended it to be. I have today laid before Parliament amendments to the 1982 awards regulations, which will come into force tomorrow. Their effect will be that local authorities in England and Wales will not be obliged to make new awards after today to overseas students who have been resident here wholly or mainly for the purposes of education. I am also today issuing guidance to local authorities. My right hon. Friend the Secretary of State for Scotland is making similar arrangements.
Our intention on fees for overseas students for 1983–84 onwards is to retain the differential arrangements which have in fact existed for many years. I shall make a further announcement as soon as possible as to how this should be done.
Local authorities in England and Wales receive 90 per cent. Exchequer grant on their expenditure on mandatory awards, which in Scotland are paid direct by my right hon. Friend the Secretary of State. Universities and other institutions in Great Britain directly funded by the Exchequer will be compensated for any unavoidable loss of fee income.
Mr. Neil Kinnock: It is unfortunate that in a commendable effort at brevity the Secretary of State might have achieved a little obscurity. Therefore, it is necessary to pry, especially as the House is rising within the next day or so, into the precise meaning of this important statement. I recall the deathless words of the present Under-Secretary of State for Education and Science, the hon. Member for Brent, North (Dr. Boyson) in January 1970, when, in response to questions about the Tory party's new policy on full cost fees, he said:
"We shan't make the savings that we plan if we start mucking about."
346
Mucking about has brought us to the present pass.
Does the Secretary of State recall or acknowledge that the full cost fees po licy turned discomfort and inconvenience into crisis for many who were trying to meet the cost of high education out of their own pockets? Does the Secretary of State also recall that the Select Committee on Education, Science and Arts in early 1980 asked the then Secretary of State for Education and Science—the present Secretary of State's predecessor—to define the term "ordinary residence" and that his reply was that the courts should decide?
Is it not a matter of general knowledge that my hon. Friend the Member for Lewisham, West (Mr. Price) then warned that it might take two or three years for such a decision to come from the courts and that he was right? As a consequence of the Government's refusal to give a definition, has not great confusion been caused in local education authorities and in higher educational institutions in addition to the confusion and hardship caused to many of the students involved? Why is it that, after such a long time, there is further delay, especially when the Under-Secretary of State gave an undertaking to the House on 25 January that we could expect a statement on this matter shortly? Why is it necessary, as it appears, that the House should have a separate statement on awards today with yet another one to come later concerning the much more costly question of the implications for higher education fees of the Scarman judgment of 16 December last?
Will the provision in paragraph 4 of the Secretary of State's statement that there will be no retrospective legislation apply as much to fees as it does to awards? [HON. MEMBERS: "Too long."] As the two are closely analogous, and as arrangements have run in tandem, that is a legitimate question to ask to enable the House to have a clear idea about exactly what the Government's intentions are in respect of fees that could have huge cost implications. [HoN. MEMBERS: "Come on."] I explained my reasons earlier for having to go in detail into this statement. If the statement had not been produced at the back end of this part of the Session, and if the education press had not gone to bed in anticipation of Easter, hon. Members might have had a full debate, but that is not possible. That is why my questioning must be detailed.
Would it not be sensible now to recognise that the Scarman judgment is a shock to the system and that it provides an opportunity for a fresh start? Is it not that fresh start that the Secretary of State is proposing to make in that part of his statement in which he said:
"local authorities … will not be obliged to make new awards after today to overseas students who have been resident here wholly or mainly for the purposes of education."
If students of immigrant families are here for their education and for perpetual residence, will they enjoy the full benefits of being students regardless of when they came here?
Would it be a case—[AN HON. MEMBER: "Oh, no!"] I recognise that exposing the utter failure of the Conservative party is bound to provoke a reaction. Will a student returning with his family to this country as a consequence of unsuccessful emigration now qualify for full awards, as he should in the belief of the Labour party? Will not the right hon. Gentleman consider adopting—[HON. MEMBERS: "Get on with it."]—the Labour party's policy for the proper treatment of overseas students on the basis of their poverty or the poverty of the country from which they came, and of their direct and legitimate

347
entitlement to awards if they are in this country for purposes other than those of education; indeed, for purposes of permanent residence.
Could I finally ask the right hon. Gentleman—[HON. MEMBERS: "Hear, hear."]—what the word "substantial" means, in paragraph 3 of his statement, in reference to the cost to taxpayers and ratepayers? What figure does his Department have to make good the judgment in the terms of the statement that the Secretary of State has made to the House?
In paragraph 5, do the differential arrangements that the Secretary of State proposes to maintain apply to the further introduction of the race relations exemption circular or is there a more complex meaning to that?
Lastly—[HON. MEMBERS: "You have said that."] All that noise, Mr. Speaker, is music to my ears, as you will understand.
Mr. A. J. Beith: On a point of order, Mr. Speaker. Has there been some change in the long-standing arrangement that Ministers make statements to the House and hon. Members in all parts of the House are given the opportunity to ask questions about them?
Mr. Speaker: The hon. Member for Bedwellty (Mr. Kinnock) has asked a few questions and I believe that he is about to ask another.
Mr. Kinnock: Once again, absolutely accurate, Mr. Speaker.
Lastly, what is the precise meaning of the final sentence of the statement? If the differential arrangements are to continue in existence and if the right hon. Gentleman proposes to compensate for any unavoidable loss of fee income to universities and other institutions directly funded by the Exchequer, what losses does he expect they will make as a result of the statement's implementation from today?
Sir Keith Joseph: The Labour Government began the process of raising fees for overseas students. We have continued with the advice that they gave. I do not apologise to the House for the time that it has taken to come forward with a statement, because it was difficult to judge the implications of the judgment of the other place. There will be no retrospection. The Government do not as yet have figures with which to answer the hon. Gentleman's last questions. There was an urgent need to make a statement about mandatory awards, but the need to make a statement about fees is not quite so urgent. However, I shall make such a statement as soon as possible. The hon. Gentleman's last questions were not immediately related to the statement.
Mr. J. Enoch Powell: Will the corresponding arrangements in Northern Ireland be made by administrative procedure and without subordinate legislation?
Sir Keith Joseph: I understand that the position in Northern Ireland is quite different in that its awards regulations already exclude from entitlement to an award someone who is resident wholly or mainly for educational purposes.
Sir William van Straubenzee: Are not the Opposition's credentials for getting heated about this issue quite nullified by the fact that it is on record that they
348
established differential fees between home and overseas students? Does my right hon. Friend understand that there will be widespread appreciation of the fact that the decision of the other place is to be observed without retrospection, but that even those—among whom I count myself—who are most enthusiastic about the cause of overseas students will feel that the law before the announcement could not be sustained, in the interests of overseas students themselves?
Sir Keith Joseph: I am grateful to my hon. Friend for his remarks. We will all agree that it is one thing to seek retrospection and quite another to seek to change the law to what we all thought it was.
Mr. Beith: How are college authorities to cope with the fact that they do not know how they are to administer differential fees for this coming academic year? Does the Secretary of State realise that his original announcement did so much damage to British interests overseas that even the Foreign Secretary's new proposals have not undone it all, and that this statement will certainly do nothing to undo it?
Sir Keith Joseph: I recognise that colleges will want to know as soon as possible how the Government intend to carry out their intentions in relation to fees. That is why I promised to make a statement as soon as possible. I need not be apologetic for the Government's continuation of the Labour Government's policy of differential charges for overseas students. It was an indescriminate policy of subsidisation, and I think that we got nearer to getting it right in the statement made by my right hon. Friend the Foreign Secretary.
Several Hon. Members rose—
Mr. Speaker: Order. I propose to call those hon. Members who have been rising in their places.
Mr. David Madel: Does my right hon. Friend's statement mean that any overseas students have been re-categorised as home students? If so, will not the University Grants Committee have to fix again its targets for home students for 1984–85?
Sir Keith Joseph: I should like to consider that. If my hon. Friend would care to table a question, I shall give him the answer.
Mr. Christopher Price: Is the Secretary of State aware that his statement has not cleared up anything? Will he confirm that the Select Committee unanimously advised his predecessor to legislate three years ago? If he had done that, this problem would not have arisen. Will the right hon. Gentleman further confirm that under a Labour Government there were three categories of student: first, full overseas students; second, students who were denied maintenance grants but who paid home student fees; third, students paying home student fees? Does the right hon. Gentleman now intend to revert to that situation? What will he eventually do about fees, now that he has acted on maintenance grants? Can the right hon. Gentleman give us any idea of the cost? Will universities and local authorities be reimbursed for something that was not in any way their fault, but wholly the responsibility of the Secretary of State's predecessor, who failed to legislate and who simply relied on the uncertain judgment in Stransky v. Stransky?
Sir Keith Joseph: The hon. Gentleman is exaggerating. I have, I hope, definitively cleared up the position about awards. A Labour Government gave advice, which this Government continued. I reserve what I have said about fees and about how we shall carry out our intentions. I confirm that universities will be reimbursed for any unavoidable costs. Local authorities, as is already provided, receive 90 per cent. of any mandatory awards that they find it proper to pay.
Mr. Gordon Wilson: I welcome the Secretary of State's assurance that there will be no retrospection, but does he not realise that many of the fees payable by overseas students are astronomical, particularly for courses on medicine and dentistry? Will not the right hon. Gentleman therefore review the situation sympathetically and beyond the level outlined in the statement made by the Foreign Secretary?
Sir Keith Joseph: We are always ready to reconsider, but we have recently arrived at a proper mixture of, on the one hand, being discriminating in our help towards individual students and countries, and, on the other hand, ending indiscriminate subsidies. The hon. Gentleman mentioned the high cost of fees for overseas students. I accept that they are high, but the judgment brought an unexpected windfall to many students who managed to go through three years of education in this country without any help from the British taxpayer.
Mr. Harry Greenway: Will my right hon. Friend confirm that his statement does not in any way affect the £46 million additional money that goes to overseas students principally from Third world countries, as they are in great need of such help? Will he also confirm that the money that is spent from Government funds on overseas students will not adversely affect the position and number of home students?
Sir Keith Joseph: I can confirm both my hon. Friend's queries.
Mr. Tam Dalyell: Since engineering is one of the courses most sought after by overseas students, does it accord with the Secretary of State's sense of morality and justice to pass by on the other side of the road and to allow the UGC to fine Swansea university and Heriot Watt university in my constituency for having too many engineering students?
Sir Keith Joseph: I have great respect for the hon. Gentleman, but that question has nothing to do with the statement.
Mr. George Foulkes: Will the Secretary of State confirm that today's statement in no way alters the position of awards to refugees, particularly those who have been granted asylum in the United Kingdom?
Sir Keith Joseph: I understand that refugees are treated as home students, and are therefore not affected. I should like to confirm that for the hon. Gentleman.
Mr. Tom McNally: Does the Secretary of State recall that on 9 June the Foreign Secretary promised the House that the definition of home and overseas students would be re-examined? Is the Secretary of State's announcement today the end of that re-examination? Will the right hon. Gentleman answer the question put to him by the hon. Member for Bedwellty (Mr. Kinnock), who asked whether the children of immigrants, such as east African Asians, who are in Britain now would have any grant prejudiced by this ruling?
Sir Keith Joseph: No, this statement is a response to a House of Lords ruling. Both sides of the House expect the Government to react in this way. With regard to the last part of the hon. Gentleman's question, the position of those immigrants is not affected by the statement, and is still under consideration.
Mr. Bob Cryer: Does not the Government's penny-pinching attitude towards overseas students contrast markedly with their lavish attitude towards Argentina? They have been prepared to back massive loans to prop up that country's economy to enable it to purchase military materials for possible use against us. When the Secretary of State says, for example, that he will issue guidance notes to local authorities, what status will those guidance notes have, will they be legally enforceable, and will he place a copy in the Library?
Sir Keith Joseph: The letter to authorities which will be sent out today will be placed in the Library. I am surprised that the hon. Member for Keighley (Mr. Cryer) appears to be in favour of indiscriminate subsidy from the bulk of the people in this country to people overseas, whatever the wealth of their families or of their countries.
Finally, I do not think the hon. Gentleman is right in saying that the Government's policy is responsible for the problem. The previous Government started the process by raising overseas students' fees.
Mr. Dennis Skinner: Is it not fair to say that today we have witnessed a Secretary of State for Education and Science, a Tory theologian, who is guilty of fudging and mudging. [HON. MEMBERS: "What?"] That is one of the phrases that Dr. Death uses from time to time. [HON. MEMBERS: "Where is he?"] He is probably busy on a big job. Would not the Secretary of State have more room for maneouvre had not his right hon. Friend the Secretary of State for Energy come to the House earlier this week to announce a £1·5 million mandatory award to a deep mining student?
Sir Keith Joseph: As the original importer of the said mining student, I take some pride in the success that he appears to have had.
Several Hon. Members rose—
Mr. Speaker: Order. I have received notice of two applications under Standing Order No. 9. I shall take them in the order in which I received them.

Bolsover District Council
3.53 pm
Mr. Dennis Skinner: On a point of order, Mr. Speaker. My point of order relates to a statement by the Minister for Housing and Construction last Wednesday at Question Time when, as reported in c. 853 of the Official Report, he referred to Bolsover district council having spent only 43 per cent. of its HIP allocation in this financial year. The Bolsover housing committee met today, about which I informed the Minister by telephone, and, contrary to the Minister's extremely misleading statement, which I am sure he will want to correct—
Mr. Speaker: Order. The hon. Gentleman's dispute with the Minister is not a point of order that I can settle. I can rule only when our Standing Orders, conventions and rules are upset. If the hon. Gentleman, who is not without ingenuity, can find a point of order on which I can rule, I shall in a spirit of goodwill, listen to him, but I am a little doubtful.
Mr. Skinner: I was coming to the point, Mr. Speaker.
In view of my telephone call to the Minister's office several hours ago, has he said that he will be making a statement to correct this matter, as the Bolsover district council has spent not only all the Tory Government's allocation but on 6 December applied for more, and received another £.1·2 million—
Mr. Speaker: Order. I have been very good to the hon. Gentleman. I allowed him to make his main point before I ruled that it was not a point of order.
Mr. Skinner rose—
Mr. Speaker: Order. That is not a matter for me.

Campaign for Nuclear Disarmament (Demonstration)
3.55 pm
Mr. Michael McNair-Wilson: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the gratuitous offer by the Campaign for Nuclear Disarmament to provide my constituents living close to the royal ordnance factory at Burghfield, particularly those living at the Mearings, with passes and car stickers to enable them to get to and from their houses during this weekend's demonstrations organised by the CND, as if it were a legal authority."
The letter from CND is couched in such a way as to give the impression that CND is a recognised authority entitled to circulate its passports to whomsoever it chooses to minimise
"any inconvenience or risk to you and your family … Obviously there will be some inconvenience, but it is in our interest and in yours that there should be no unpleasantness over your leaving and returning home… Cars bearing these stickers"
the CND stickers—
"are to be allowed through."
The idea that any organisation, no matter what its intentions, should take upon itself to write and to issue passes to law-abiding citizens of this country without which they may be prevented from having free access to their homes by demonstrators called out by that same organisation—in this case, CND—is to my mind arrogantly high-handed and suggests that CND expects its supporters to prevent Thames valley police from making it possible for my constituents to go about their lawful business unmolested—a worrying portent for this weekend's demonstration in Berkshire.
That is my specific concern and why I believe the House should debate this matter now. I submit that this incident raises the important question whether an outside body, such as the Campaign for Nuclear Disarmament, planning a massive demonstration this weekend that will cause enormous inconvenience and aggravation to hundreds, if not thousands, of people—many of whom are my constituents—as well as tying down large numbers of police, should not be asked to enter into some form of agreement to guarantee the absolute right to law-abiding persons to have access to their houses and to all highways and public roads close to a demonstration.
Lastly, Mr. Speaker, I suggest that this matter is very urgent because the demonstration is to start tomorrow, 31 March.
Mr. Speaker: The hon. Member for Newbury (Mr. McNair-Wilson) gave me notice before 12 o'clock midday that he might seek to make an application under Standing Order No. 9 this afternoon for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
"the gratuitous offer by the Campaign for Nuclear Disarmament to provide my constituents living close to the royal ordnance factory at Burghfield, particularly those living at the Mearings, with passes and car stickers to enable them to get to and from their houses during this weekend's demonstrations organised by CND, as if it were a legal authority."
As the House knows, under Standing Order No. 9 I am directed to take into account the several factors set out in the order but to give no reasons for my decision.

353
I listened carefully to what the hon. Gentleman had to say, but I must rule that his submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.
Later—
Mr. Tom McNally: On a point of order, Mr. Speaker. While very much respecting your ruling on the first Standing Order application, as it is Home Office questions tomorrow and the Home Secretary will be present, will it be possible for him to make a statement to the House about the legal implications of the issuing of laissez-passars by the CND?
Mr. Speaker: I am sure that the hon. Gentleman's words will have been noted. I never invite Ministers to make statements—they ask me, and I have never yet said no.

Wytch Farm (Sale)
4 pm
Mr. John Smith: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the impending forced sale of the Wytch Farm oilfield".
The matter is specific and important because the Government's policy is to force the British Gas Corporation to sell its interest in a most important onshore nuclear oilfield, which has developed on its own initiative into an extremely valuable asset, for no reason other than the Government's ideological obsession to strip public corporations of their assets. On numerous occasions hon. Members have expressed their fears that the Government are seeking to force the British Gas Corporation to sell its interest at well below its true value to the nation.
The matter is urgent because I understand that today the Secretary of State for Energy is meeting—or has met—the corporation in an attempt to force the sale at a low price.
In reply to a question in the House on Monday of this week, the Secretary of State said:
"The only independent valuation of which I am aware is that produced last month by the distinguished oil analyst, Wood Mackenzie and Company, which put a value of between £141 million and £213 million on the BGC's interest."—[Official Report, 28 March 1983; Vol. 40, c. 12.]
That statement contrasts disturbingly with a written answer on 29 July last year, in reply to a question by my hon. Friend the Member for Merthyr Tydfil (Mr. Rowlands), when the Under-Secretary said:
"My Department has seen. on a confidential basis, a copy of an independent report prepared by petroleum consultants on the prospects for PL.089."—[Official Report, 29 July 1982; Vol. 28, c. 636.]
It is quite clear that two valuations were given to the Secretary of State for Energy. They were made known to the Department, and must have been known to him. The only valuation of which the Secretary of State claimed knowledge last Monday was, not surprisingly, much lower than the one to which I have referred.
Before the House has an opportunity to consider this matter, and in the context of misleading information given to the House by the Secretary of State for Energy, a fait accompli may have taken place. I therefore seek to call the Secretary of State to the House to account for his actions before it is too late.
Mr. Speaker: The right hon. Member for Lanarkshire, North (Mr. Smith) gave me notice before 12 o'clock midday that he would seek leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that should be given urgent consideration, namely,
"the impending forced sale of the Wytch Farm oilfield."
As the House knows, under Standing Order No. 9, I am directed to take into account the several factors set out in the order, but to give no reason for my decision.
I listened carefully to the right hon. Gentleman and to the arguments that he advanced, but I must rule that his submission does not fall within the provisions of the Standing Order. Therefore, I cannot submit his application to the House.

BALLOT FOR NOTICES OF MOTIONS FOR FRIDAY 15 APRIL
Members successful in the ballot were:

Mr. Ivor Stanbrook

Mr. Ivor Stanbrook: I beg to give notice that on Friday 15 April I shall draw attention to the problems of the dependencies of the United Kingdom, and move a resolution.
Mr. Speaker: I am much obliged, but what the hon. Gentleman has said is a little exceptional.

Mr. Peter Temple-Morris

Dr. Edmund Marshall

Anderson Strathclyde (Prevention of Take-over)
4.5 pm
Mr. Dennis Canavan: I beg to move,
That leave be given to bring in a Bill to prevent any takeover of Anderson Strathclyde plc which is against the public interest; and for connected purposes.
It was a former Tory Prime Minister who coined the phrase about the unacceptable face of capitalism. A decade or so ago the right hon. Member for Sidcup (Mr. Heath) was referring to the activities of a multinational company called Lonrho, which had South African connections. Ironically, we are today discussing the activities of another multinational company, Charter Consolidated, which also has South African connections and is in the process of taking over the Scottish company Anderson Strathclyde.
It is not simply another example of yet another takeover and the growth of power of multinational companies. It is an instance of the unacceptable face of capitalism infiltrating the corridors of power at Westminster, Whitehall and even the British Cabinet itself. It is an example of the abdication of responsibility and gross dereliction of duty by people who were appointed to responsible public positions, supposedly to look after the public interest, and who, far from looking after that public interest, have acted against it and put their own private interests before the public good.
I and other hon. Members have previously referred to the role of the non-elected Secretary of State for Trade, Lord Cockfield, with his vested interest in Charter Consolidated. It is worth pointing out that the Financial Times and other newspapers recently stated that Lord Cockfield had not dealt in the shares of that company since he became a Minister. In fact, the register of shareholders for Charter Consolidated tells a different story. It shows that Lord Cockfield's account for 2,500 ordinary shares was not closed until 24 May 1982—three years after his appointment as a Minister, and three weeks after Charter Consolidated's bid for Anderson Strathclyde was made. The week after the closure of Lord Cockfield's account, his Department formally referred the contested bid to the Monopolies and Mergers Commission.
There is also the role of the hon. Member for Lewes (Mr. Rathbone), who, I understand, was, and possibly still is, a Parliamentary Private Secretary at the Department of Trade. He is a director of the large corporate public relations firm Charles Barker, which handles Charter Consolidated's PR account. I am informed that the executive director of Charter Consolidated, Mr. John Richardson, wrote to the hon. Member for Lewes at the Department—a lengthy personal letter—about the virtues of the merger.
Charter Consolidated was also being helped in its bid by its financial advisers Hambros—another company with good connections with the Tory party. According to the register of interests, the Tory MP for Sevenoaks (Mr. Wolfson) is a director of Hambros Bank, and the Hambros group has regularly given financial donations to the Conservative party—I understand of the order of £20,000 a year.
During a debate on the Floor of the House last week the Minister for Trade told my hon. Friend the Member for South Ayrshire (Mr. Foulkes) that he did not live in the

357
same squalid world as my hon. Friend. I wish to tell the Minister, and I am sure that my hon. Friend agrees with me, that we are glad that we do not live in the same squalid world as he and his friends in the Tory party. The whole matter stinks.
Last week, the week before, last month, last year, or whenever, the Minister repeatedly failed to give a satisfactory explanation of his unprecedented decision to overrule the Monopolies and Mergers Commission. I am forced to conclude that people in high places have been nobbled by their rich Tory friends. We can see the result in the disastrous effect on the Scottish economy in terms of employment—or, rather, potential unemployment. We already have more than a third of a million unemployed in Scotland, and now more than 3,000 additional jobs in Anderson Strathclyde are at risk because of the reckless measures taken by the Government.
The history of the Scottish economy shows that the growth of multinational companies through mergers, takeovers, and so on, leads to increased non-accountability. It leads to people wanting to get their greedy hands on financial interests, with a minimum amount of accountability to local interests. The result is remote control, lack of local accountability to the work force, and so on.
For all those reasons, and others, not only the majority of members of the Monopolies and Mergers Commission, but the trade unions representing the work force, the board of Anderson Strathclyde, local authorities in Scotland, and most of the customers of Anderson Strathclyde expressed their total opposition to the takeover. Unfortunately, the Minister allowed it to go ahead, which led to the events of last week when a sufficient number of shareholders sold out to Charter Consolidated. Some people may think that the motion that I tabled three weeks ago has been overtaken by events, because the takeover is now a fait accompli, but I shall explain that that is not necessarily so.
My original intention was to say that no takeover of Anderson Strathclyde would be possible unless the proposed takeover had the approval of, first, the Monopolies and Mergers Commission, second, the majority of the Anderson Strathclyde work force, third, the majority of the Anderson Strathclyde shareholders, and, fourth, the majority of members of the Scottish Grand Committee in this House. That would introduce an element of not only parliamentary but industrial democracy. If there is a case for saying that shareholders should have a say in the future ownership of a company, surely the same is true for the work force. If those who invest capital in a company have a say in the ownership and future ownership of a company, those who invest their labour should also have a say. The proposals in my Bill would ultimately be subject to the approval of the Anderson Strathclyde work force.
In view of last week's events, I have come to the conclusion that the best way to nullify the takeover and
358
preserve the public interest is to take out some form of public ownership of Anderson Strathclyde. I have a great deal of sympathy for full-scale nationalisation in an instance like this, and I am sure that many of my hon. Friends would also see considerable merit in that. However, no doubt voices would be raised in the House about the possibility of demands for compensation, some of them legitimate, especially for those shareholders of Anderson Strathclyde who remained loyal to the company by refusing to sell out to Charter Consolidated.
There are other hon. Members who often speak of the merits of the mixed economy. So, in an effort to broaden support on both sides of the House for my measure, I shall moderate my demands and propose a mixed economy solution. In other words, I propose to take into public ownership only those shares that are now held by Charter Consolidated and transfer that holding to the Scottish Development Agency. That would ensure a major public stake in Anderson Strathclyde.
Mr. Bob Cryer: Eminently reasonable.
Mr. Canavan: Finally, on the question of compensation, I should be prepared to consider needy cases on their merits. However, I am bound to say that some cases deserve nothing at all. For example, Lord Cockfield and his friends would have great difficulty in putting forward a case that was based on need. So I am of the opinion that he and his friends should not get a penny of compensation.
I should also bear in mind the morality—or rather the immorality—of the South African connection of Charter Consolidated, because those who willingly and knowingly invest in the evil of apartheid should not be compensated at all. Thus, compensatior. under the Bill would be kept to an absolute minimum and the majority public stake in Anderson Strathclyde would ensure that the company remains a Scottish-based one, responsive to the aspirations of its work force, the needs of its customers, and the general public interest. I therefore ask the House to approve unanimously my moderate Bill.
Mr. Cryer: The essence of moderation.
Mr. Canavan: Does the Minister for Trade wish to put his name to it?
Question put and agreed to.
Bill ordered to be brought in by Mr. Dennis Canavan, Mr. David Marshall, Mr. Norman Hogg, Mr. Dick Douglas, Mr. William McKelvey, Mr. Gavin Strang, Mr. William Hamilton, Mr. Dennis Skinner, Dr. Jeremy Bray, Mr. Tom Clarke, Mr. Bob Cryer and Mr. Stuart Holland.

Anderson Strathclyde (Prevention of Take-over)
  ANDERSON STRATHCLYDE (PREVENTION OF TAKEOVER)
  Mr. Dennis Canavan accordingly presented a Bill to prevent any takeover of Anderson Strathclyde plc which is against the public interest; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 22 April and to be printed. [Bill 119.]

Local Authorities (Expenditure Powers) Bill
Order for Second Reading read.
4.16 pm
The Secretary of State for the Environment (Mr. Tom King): I beg to move, that the Bill be now read a Second time.
In response to a question in Hansard on 11 February from the right hon. Member for Manchester, Ardwick (Mr. Kaufman), about the urban development grants programme, I told the House that doubts had been expressed by some authorities
"about their powers under section 137 of the Local Government Act 1972 to grant aid land acquisition and building works comprised in projects approved for urban development grant because one of the specific powers conferred on them is to make loans for these purposes."
I said then that I was advised that there were sufficient grounds for doubt that it would be right to amend the law in England and Wales to clarify the matter, and that I intended to do that at the earliest opportunity. I have brought the Bill before the House today in an effort to discharge the undertaking that I gave the right hon. Gentleman. I made clear that
"In the meantime, I am prepared to pay urban development grant towards expenditure incurred for those purposes on approved schemes. I hope to announce the first list of project approvals shortly."—[Official Report, 11 February 1983; Vol. 36, c. 484.]
I did that four days later.
Mr. George Cunningham: Will the right hon. Gentleman allow me?
Mr. King: May I just get started and say a few words.
Mr. Cunningham: It is on what the Minister said.
Mr. King: I was grateful at that time for the general welcome that was given to the urban development grant scheme, which I think has been widely welcomed by all political parties as a way in which to direct and stimulate private investment, using public money as the pump primer to get more investment into inner cities and areas of social need.
Mr. Cunningham: I want to ask the Minister about his first sentence. He seems to be accepting that there is a doubt as to what the law is at the moment. Does that mean that this Bill is intended to remove that doubt retrospectively? Will this Bill have retrospective effect? Yes or no?
Mr. King: No. It does not have retrospective effect because it involves payments that are to be made in the year 1983–84. The proposals that I announced on 15 February concern schemes that will be implemented in 1983–84. Provided the Bill proceeds satisfactorily, I trust that there will be no question of retrospective effect.
I am grateful for what I believe is the general welcome that has been given to this proposal for urban development grants. It involves the powers of both central Government and local authorities to pay grants, in that the urban development grants element of the total expenditure is met under the normal urban programme provision of 75 per cent. central Government and 25 per cent. local government grant.
One of the merits of the urban development grant scheme is that it covers a wide range of projects. In a
360
moment I shall say a word about the latest batch, which further illustrates the variety of projects that are possible under the scheme. We are eager to encourage such projects. We are anxious that they should be supported and to see no impediment to the powers available to local authorities so that they can play their part and make their contribution to the projects that are approved.
I hasten to say that the Bill will benefit areas where there was doubt and it was thought that there were not adequate powers. However, we expect that for a considerable number of authorities, depending on the project involved—it may be a housing project or an environmental project—there will be adequate powers. It is in connection with the possible overlap with the Local Authorities (Land) Act 1963, as amended, that that doubt has arisen. We wish to remove that doubt. The other reason why there is variety in the individual authorities is that their powers depend on their local Acts, which vary. Right hon. and hon. Members will know that there is a considerable variety of local legislation that gives different powers to local authorities.
I do not want to labour this point as this is a technical amendment. The hon. Member for Islington, South and Finsbury (Mr. Cunningham) may wish to debate this point. There may be an implication that somehow the Bill increases the powers of local authorities to spend money under section 137 of the Local Government Act 1972. If they allocate the funds that are available to them under section 137 for these projects, that restricts the funds that are available for other projects. As those projects will have private sector investment, be approved by the Government and put forward by the local authority, they will be partnership schemes and in that sense will tend to reduce the scope for the abuse of section 137 that the hon. Gentleman has suggested has happened in certain areas, and which has given him great concern.
The fundamental aspect of section 137 is that it is the catch-all or provide-all provision that enables local authorities to incur expenditure up to the product of a 2p rate in any financial year for the purposes that in their opinion are in the interests of their area or its inhabitants. It is a well-known and useful provision, much valued by people in local government and used in the vast majority of cases responsibly and sensibly for a number of different purposes. It also gives valuable local discretion to local authorities.
There is a clear prescription in the Local Government Act 1972 that makes it clear that that power cannot be used where there already exists a specific power, albeit narrow, to incur expenditure. The problem that has arisen relates to the Local Authorities (Land) Act and, possibly, to local Acts where there are specific powers. The power provided under the amendment to the Local Authorities (Land) Act made it clear that a local authority can make a loan. The doubt was expressed that as there was a power to make an advance, but it could be only a loan, it prevented the use of section 137 where an authority wishes to make a grant for a similar purpose, whether for the acquisition of land or the carrying out of building works on land. There was doubt about whether that was a real uncertainty and difficulty, but I was satisfied that to avoid any possible doubt, it was sensible to invite the House to pass the amendment to the existing legislation, which is incorporated in the Bill.
The order-making power in the Bill may exercise the minds of some hon. Members. The Bill gives the Secretary

361
of State the final say in deciding whether an order shall be made. Subsection (3) enables the Secretary of State to limit the extent to which a local Act shall be disregarded for the purpose of determining section 137 spending powers, and subsection (4) provides for consultation between the Secretary of State and the local authority before an order is made.
I have spoken briefly about the amendment. I have not sought to go through the Bill because if one starts doing that one comes out at the other end before one realises that one has started. I have outlined the purpose of the Bill. It relates to a narrow point that I described to the right hon. Member for Ardwick in my answer to him. I do not underestimate the value that it can bring in respect of avoiding doubt over the implementation of the urban development grant. I think that it will prove to be an important new scheme.
I announced to the House on 15 February the first 41 projects that I had approved, which amounted to an additional £50 million of new investment, of which about £10 million will be urban development grant. They will attract £40 million of private sector investment, thereby achieving a ratio of 4:1. Today I am approving a further 16 projects amounting to a further £32 million of new investment in inner cities and areas of social need. That will comprise some £6 million of public sector contribution. There will be £4·5 million from the national Exchequer and £1·5 million from the local authority concerned. About £26 million of private sector investment will be attracted giving us a slightly better ratio of 4·5:1.
I shall quickly give the names of the authorities of which the projects that they have put forward in partnership with the private sector I am supporting. I think that I shall be acquitted of political prejudice. The authorities are Newcastle, Leeds, Wakefield, Sheffield, South Tyneside, Birmingham, Rochdale, Sandwell, Brent, Hackney, Southwark and Tower Hamlets. The projects covered involve housing, industrial units, craft workshops and a number of schemes that will undoubtedly be in areas and sites that otherwise would have remained derelict and unimproved. Now the inner cities will see economic activity once again and will provide employment, with the construction work involved and also with the subsequent occupations that will be created. The projects will play a useful part in removing further eyesores. I have therefore announced to the House so far under the scheme some £.16 million of urban development grant projects approved, which have now generated a total of £80 million of new investment. I hope that the House will agree that this was a most encouraging start.
The House will be aware that there are still a considerable number of projects awaiting assessment, appraisal and, I hope, approval. I point out to hon. Members who have raised the matter and to the local authorities concerned that I am aware that authorities are still awaiting a reply from my Department about projects. They will appreciate that this has been a new scheme for the Department to manage and that much additional work has been entailed. Local authorities, too, had to understand how to submit applications properly.
Only this morning I had a discussion with my noble Friend the Minister for Local Government about how we can speed up our end of the appraisal process. The House will appreciate that it is important that the appraisal is done thoroughly. Anyone who makes even a cursory study of the projects, especially some that have been rejected, will
362
know that we have to consider carefully the key issue as to whether the project would proceed, were it not for the public sector contribution. This is an important consideration in the management of and responsibility for public funds. Therefore, a careful appraisal must be made.
There are ways in which we can improve the processing and appraisal procedures and the final approval by Ministers. I am anxious that something is done. I know that private investors and developers have approached local authorities about projects and that the authorities are embarrassed because they have not had a reply from the Department. They are anxious to proceed with the schemes. I hope that we be able to give early replies about the projects which are still coming forward.
Mr. Christopher Murphy: My right hon. Friend said earlier that he did not want to be accused of political prejudice, which I understand. However, I should like him to be a little politically prejudiced. Surely what he is saying is that he is liberating a large amount of private enterprise money which will go into areas which would otherwise not get an opportunity to be redeveloped for the good of the people who live there. Surely that is something that we as a Conservative Government should be proud of.
Mr. King: If my hon. Friend was under the impression that I was not proud of the announcement I was making, I am sorry that I misled the House. I am extremely proud of the urban development grant scheme. It makes a major contribution in a most important area. Anyone who makes the most limited study of the problems of inner cities—the House will know that I spend quite a bit of time on these problems—will know that there will never be the public resources that we need to tackle all the problems. Capital investment is needed. One of the tragedies of the last 10 years is that inner cities have seen investment decline. We must get investment back into the inner cities. The most effective way to do it is by enlisting the support, enthusiasm and skills of the private sector.
We must unlock the substantial resources that exist within private investment, in the pension funds, insurance companies, banks and building societies; these resources could make a major contribution to tackling some of the problems. The type of investment which institutions are prepared to make is important for improving the environment of inner cities.
Mr. Don Dixon: The Minister has mentioned inner city areas many times. I was pleased that he referred to south Tyneside at the beginning of his speech. Will he not accept that urban areas such as south Tyneside have as many, if not more, social problems than some of the inner city areas that he keeps talking about? It is a misnomer to refer continually to inner cities as if they were the only areas with social problems. I remind him again that the area that I represent has more social problems than many inner city areas.
Mr. King: I used the term "inner cities" in a fairly wide context. I make it clear that urban dereliction exists in many areas. It is part of our programme to seek to remove it. The more we can bring in additional resources from the private sector and the more we do to ensure that such resources as exist within the urban area may be used to attack the problem across the widest front, the better. The hon. Member will know the language of the partnership

363
authority, the programme authority or the designated district. Several of the new schemes have helped to get away from too narrow a definition into other pockets of dereliction where we are anxious to see a contribution made.
It is exciting, and I hope the House will share the excitement, to be able to announce this year urban development expenditure of £349 million, which is some 28 per cent. above the provision for last year. The expenditure on urban deprivation or whatever phrase one uses, will be greater because I have been able to announce to the House on successive occasions substantial additional programmes of investment. On the derelict land grant I announced in addition to the public sector investment of £30 million a contribution of £200 million from the private sector. I am in the business of seeing how I can harness the most substantial resources effectively and viably. It is not just a case of pumping in subsidy but ensuring that there are viable improvements in inner city areas so that they can thereafter become self-sustaining. That is the approach I am seeking to adopt.
I want to ensure that there is no legislative impediment for the few local authorities that are affected by existing legislation; it is not possible to be certain how many are affected. Because I wished to respond to the local authorities which are concerned about the matter, I have brought forward this short Bill at the first opportunity to remove any doubts. It is against that background that I commend the Bill to the House.
4.37 pm
Mr. Gerald Kaufman: I should say at the outset that we shall assist the Bill on its way to the statute book. We have some criticisms. We shall seek to improve the Bill, but we support the intentions behind it.
The necessity for the Bill is yet another example of the almost lunatic incompetence that has afflicted almost every move of successive Secretaries of State for the Environment during the past four years. Scarcely a week goes by without new evidence of the mess into which the Government have plunged themselves and local government as well. Every time they so much as touch anything to do with local government finance, it somehow seems to go wrong.
Last Thursday, for example, we had an extraordinary written answer by the Secretary of State who, in a move unprecedented even for him, chided local authorities for having claimed too little rate support grant. He warned them that, whether they like it or not, they will get more. It seems that local authorities have under-claimed rate support grant to the tune of £57 million for the new financial year and that, instead of the usual clawback that is the consequence of aggregate over-claim, there is to be yet another of the Government's innovations in local government finance. A new name will have to be invented for the bizarre process—possibly clawforward or handback.
The Secretary of State, whose sheer cheek knows no bounds, asserted in his answer that the unprecedented move was a result of the effective operation of the grant system, but it is really the result of a grant system so berserk in its methodology that local authorities have no idea how to claim. In despair, and knowing the
364
Government very well, they have claimed too little in the hope that, by doing so, they will fend off the evil eye of the Secretary of State.
Mr. King: The right hon. Gentleman may regret that purple passage. I asked my officials whether it was the first time that this had happened. I am advised that it happened in 1975, or 1977, when the right hon. Gentleman was a Minister.
Mr. Kaufman: I accept that, but we did not claim to have introduced a system so open and clear that no one could possibly misunderstand it. Nor did we claim, as the Secretary of State did in a desperate last sentence in his answer, that it was the result of the effective operation of the grant system.
The Bill is yet another example of the confusion that the Secretary of State generates wherever he goes. He referred to my question to him last month and his reply to it. When I asked whether the legislation governing urban development grants was effective, the Secretary of State airily replied that it was perfectly all right, but that as there might just be some small ground for doubt, he intended to amend the law to "clarify" the matter. We should always be wary when the Secretary of State uses that word. He first used it in its special sense in last year's rate support grant report when he discovered that the holdback scheme was illegal and announced that legislation would be introduced to "clarify" the law. The language of the previous Secretary of State was Heseltinese. We now have King's English, but that, too, requires translation. The word "clarify" is King's English for retrospectively legalising something that was illegal when the Secretary of State originally did it. Last month he was saying comfortably that there was no more than some ground for doubt about the right of local authorities to make grants, but the explanatory memorandum to the Bill flatly states:
"Section 137 does not at present authorise expenditure for a purpose for which other, albeit narrower, powers to spend exist."
That is not doubt. It is prohibition, and the Bill rightly removes it.
Mr. George Cunningham: Perhaps I may put to the right hon. Gentleman the question that I put to the Secretary of State. Is it his understanding that the Bill has retrospective effect in making legal something that has already been done and which, but for the Bill, might be held to have been unlawful?
Mr. Kaufman: The Secretary of State, quite defiantly in his reply to me last month, said that although the position was as he described it, he was nevertheless prepared to pay urban development grant towards expenditure incurred for those purposes on approved schemes. The hon. Gentleman's understanding may be better than mine in these opaque circumstances. I understood that the Secretary of State was prepared to pay the money to the local authorities—there has never been any doubt about his power to do that—but that it was not certain that the authorities could use that money until the Bill authorised it. Therefore, I am not entirely sure whether the Bill is retrospective. As I shall show, however, other areas of the Bill are so imprecise that it is difficult to justify them in their present form.
The intervention of the hon. Member for Islington, South and Finsbury (Mr. Cunningham) illustrates the nature of the muddle. The position is the more reprehensible because, only a year ago, the Government

365
conducted a thorough review of section 137 of the 1972 Act but did not discover the flaw now being corrected by the Bill. At the time, of course, the Secretary of State was not seeking to provide greater powers for local authorities to assist urban regeneration. Indeed, he issued a consultation paper aimed at restricting those powers, proposing that the financial limits for such expenditure should be reduced from a 2p rate to a ½p rate and that aid should be limited to independent firms employing no more than 25 people. He further proposed that all local Act powers should be terminated and that section 137 should be repealed. There was an outburst of rage from local authorities, and in the Local Government (Miscellaneous Provisions) Act the Government abandoned the restrictions proposed in the consultation paper and expanded the powers.
The Bill is the latest stage in the long process of educating the Government in the value of local enterprise, but the Secretary of State has made a number of mistakes in the way in which he has dealt with it. First, he promised consultation on the Bill—for example, with the Association of Metropolitan Authorities—but there was no consultation.
Secondly, the right hon. Gentleman has compounded that failure in the text of the Bill, because clause 1(4) fails to provide for consultation with the local authority associations as well as with the local authorities. we shall seek to remedy that in Committee, and I hope that the Government will accept our amendment.
Thirdly, the Secretary of State gives himself power to discriminate between local authorities when making an order not restricting the use of section 137 and does not even require himself to give reasons for that discrimination.
As the AMA put it to me in a letter today, the Secretary of State now has even more ability to place one authority in a more advantageous position than another. He does not have to give reasons for his choice. He is required to consult only those local authorities affected by the order, thus effectively playing one authority off against another. That is unacceptable and we shall seek to change it. It is yet one more example of the Conservatives' local government legislation providing a blank cheque for the Secretary of State. The Bill must be almost unprecedented in giving a Minister power to amend enactments—namely, local Acts—without knowing that he intends to amend them until he decides to do so and possibly without even knowing of their existence.
The total lack of clarity was made devastatingly clear in a remarkable answer yesterday by the Under-Secretary of State to the hon. Member for Islington, South and Finsbury. It is worth calling attention to that answer today. The hon. Gentleman asked the Minister
"if he will give the titles of any local Acts which he would propose to the designate under clause 1(2)(c) of the Local Authority (Expenditure Powers) Bill."
The Under-Secretary of State replied:
"No. It will be for the local authority concerned, in the context of a particular UDG proposal, to draw my right hon. Friend's attention to the existence of any provision in a local Act which in its view inhibits its use of section 137."—[Official Report, 29 March 1983; Vol. 40, c. 98.]
It is remarkable that the Secretary of State should seek power to amend legislation of which he is unaware. These are serious flaws in the Bill, and we shall seek to put them right in Committee.
366
Despite all that, however, we wholeheartedly welcome the intentions of the legislation. The urban development grant system is based on experience in the United States. Like other hon. Members, I have seen the excellent results achieved by the urban development action grants programme, which President Reagan wanted to kill off when he came to office but which public outrage compelled him to reprieve, although its funding was severely cut. Although urban problems in the United States are far more serious than ours, in many parts of that country urban renewal has been carried out far more imaginatively than in this country. Magnificent examples that I have seen include the regeneration of the waterfront in Baltimore and the renewal of the old town in Portland, Maine. The Americans are especially inventive and ingenious in converting disused buildings, such as old schools and warehouses, into excellent apartment blocks. I am glad that the same practice is now being followed here in my own city of Manchester as well as in Nottingham and other parts of the country.
Mr. Murphy: It is understandable that the right hon. Gentleman should praise Local enterprise, but I notice that he has not yet, for all his examples, praised private enterprise. Would he like to do so?
Mr. Kaufman: I shall have a word to say about private enterprise in a moment, but whether it will be to the hon. Gentleman's taste will be for him to decide.
One reason for the successes of urban renewal in the United States is the readiness of local businesses and banks there to put money—matching funds—into projects which they have the good sense to realise make their localities far more attractive for improved business and further investment. I am sorry to say that similar institutions in Britain have shown far too little loyalty to their areas. They seem to have little commitment to the towns and cities that provide them with their profits and the people who work for them. Of course there are exceptions. The UDG schemes that the Secretary of State published last month list some of them. No doubt today's list will do so as well. Many local authorities have responded to the opportunities with ingenuity and imagination. Anyone who has seen the work that is being done in Leeds will vouch for that.
I wish that the Secretary of State would give us more precise information about those schemes. When he made his statement last month, he failed completely to tell the House how much new money will be put into that initiative. Indeed, he seemed anxious to obfuscate rather than to illuminate. When he replies, I hope that the Under-Secretary of State will give more satisfactory information about the amount of new money that is going into those schemes. Last month, the Secretary of State spoke about 4,000 jobs being created or retained by the UDG schemes. When questioned about that, he was unacceptably vague about whether 4,000 jobs really are involved and, if so, how many will be new and how many will be continuing jobs as distinct from temporary ones during construction. He failed again today to give that information. We have a right to it.
We are pleased that the Secretary of State is willing to assist UDG schemes, but his horizons seem to be restricted. I wish that he would give local authorities much wider scope for job creation. Apart from urban development grants, many local authorities—which are almost invariably Labour-controlled—are pioneering

367
creditable new initiatives that have great potential. The West Midlands county council is especially active through its economic development board and its subsidised loans scheme. Other local authorities are also playing their part. I commend with special pride the decision of Greater Manchester council to buy the Midland hotel in Manchester, thus thwarting the Government's privatisation policies and retaining that outstanding hotel, which is a unique institution in Manchester, in the public sector.
If local councils are to be resource creators rather than resource consumers, they need far greater scope. The 2p limitation that is currently imposed on section 137 expenditure is regarded by many local authorities as highly restrictive and results in the stifling of local initiative. For example, the Association of District Councils informed me in a letter yesterday:
"Inner urban area programme authorities like Leicester and Nottingham are already finding difficulty in containing their expenditure on approved schemes within the 2p rate limit, and the ADC will wish to consider … whether to seek an amendment to the Bill to deal with this situation."
The Labour party, in the campaign document that it published yesterday, reaffirmed its long-standing commitment to assist local authorities to create jobs and revive local economies. As part of that, we shall abolish—[Interruption.] The right hon. Gentleman had better behave himself. We are discussing a serious Bill and he should not heckle in a flippant way—[Interruption.] If someone is being frivolous, he brings a grin to one's face from time to time.
We shall abolish section 137 and replace it with a power of general competence for all local authorities to carry out whatever activities are not expressely forbidden by statute.
Mr. Peter Bottomley: What projects that the GLC, for example, would like to go ahead with if it were not restricted by section 137—let alone the projects that it is using powers for at the moment—would the right hon. Gentleman approve?
Mr. Kaufman: I do not carry a list of the projects of every local authority in the country. If the hon. Gentleman wants to ask that question, he should write to the GLC about it. We do not believe that it is the business of central Government to act as an interfering nanny with local government. That being so, we believe that local authorities should have a power of general competence, excluding—
Mr. King: How?
Mr. Kaufman: We shall legislate to provide it. However, we shall exclude some matters that we shall specify in statute.
Mr. George Cunningham: Does the Labour party nationally approve of the use of public funds to finance the administrative costs of meetings of Labour party leaders of exclusively Labour-controlled local authorities in London by Islington borough council, the GLC and between six and 10 other London boroughs? Moreover, does he envisage the new power—it seems to be a power of complete discretion—being used for political purposes with even greater abandon than now?
Mr. Kaufman: That is a matter for the local electorate and, if there is any alleged impropriety, for the district auditor. When, last year, the electorate of Islington had to
368
choose between the Social Democratic party, to which the hon. Gentleman belongs, and the Labour party, it almost completely destroyed the hon. Gentleman's party and returned mine to office.
Mr. George Cunningham: On 17 per cent. of the vote.
Mr. Kaufman: Yes; but if the hon. Gentleman's party had won on 17 per cent. of the vote, he would say that that was vindication for his party.
It may be novel for the House to hear this after four years of this Government, but my point is that it is for local authorities to make their decisions. If their decisions are disapproved of by the local electorate, that electorate has a remedy. The local electorate had that remedy in Islington and they decided to throw out the people who had taken over without any right to do so and overwhelmingly returned a Labour council.
Mr. George Cunningham: They are changing their mind now.
Mr. Kaufman: Let us see whether the hon. Gentleman is here after the general election to tell us about it.
The power of general competence that we shall include in our reform of local government will accompany the many other reforms that will strengthen local democracy following four years of the most centralist Government that the country has had in modern times. To be able to conduct the type of initiatives that we have been discussing—the Secretary of State has also discussed them—local authorities need not only legislative freedom, but money. In the end, we must return to the damaging effects of the Government's penal attempts to limit local authority expenditure.
In response to the hon. Member for Welwyn and Hatfield (Mr. Murphy), the Secretary of State said today that there will never be the necessary public resources. Of course there will never be sufficient public money to provide for all the things that we should like. Nevertheless, last year the Secretary of State cut rate support grant for the partnership and programme authorities and the designated districts by 10·7 per cent. This year the reduction is even worse at 16·2 per cent. Rate support grant holdback in the past two years for those authorities totals an unacceptable £157 million. Only yesterday the Chief Secretary to the Treasury blurted out that holdback in the coming year will reach the record level of £400 million. If local authorities were not being deprived of those huge sums, their ability to generate more employment and to freshen the faces of the towns and cities for which they are responsible would be enhanced.
The analysis of urban deprivation published by the Secretary of State last month is a daunting and depressing picture of the grinding poverty that afflicts too many of our urban centres—overcrowding and loneliness, isolated pensioners and single parents, children without sufficient chance in life and high mortality rates. That poverty of the body is accompanied by poverty of the soul, by ugly and derelict buildings, waste land strewn with rubbish, meanness of circumstance and degradation of spirit. Any action that lifts up the eye and the heart, that provides better homes and a better chance of a job must be welcomed. This Bill removes some barriers to the achievement of those objectives and, for that reason, the Opposition will grant it a fair passage. But it is only a tiny

369
start. Others must take the action that will get to grips with our urban wastelands on the scale required if their problems are to be solved.
5 pm
Mr. George Cunningham: The debate, even so far, has proved the usefulness of considering the Bill in the normal way. However, that was not the original intention. Both Front Benches intended to discuss the Bill in a Second Reading Committee.
Mr. Kaufman: The hon. Gentleman is, I am sure inadvertently, inaccurate. It was never proposed that the Bill should be discussed in a Second Reading Committee. The Labour party would not have accepted that proposal, and the Government did not make it. The Government wished to take all the stages of the Bill today, but we disagreed with that. That is why we are having the Second Reading today and why the Bill will go to a Standing Committee. I hope that the hon. Gentleman will withdraw his remarks.
Mr. Cunningham: I know about the alternative proposal, but I was told—I shall not name names—that the first intention was that the Bill should be taken in a Second Reading Committee. Someone must have had the idea, because I remember having to argue against it. If right hon. and hon. Members on both Front Benches wish to sort out whose idea it was—[HON. MEMBERS: "Withdraw."] If the Opposition do not wish to have a Second Reading Committee, they can put a stop to it, as can almost any group of Members. I am glad to hear that the Labour party objected to the proposal to take all stages in the House today. I, too, objected strongly to that, and the debate has shown the need for taking the Bill in the normal way.
The Secretary of State said that if he went through the Bill bit by bit he would come out of the back before he got inside the front. However, the Bill is rather like Doctor Who's police box—its internal dimensions are larger than its superficial appearance. That will be found as we examine the Bill, both here and in Committee.
The Secretary of State spoke mostly about the purposes to which the Bill and accompanying legislation can usefully be put in the inner cities. I do not dissent from his general philosophy—the desirability of a major effort in the inner cities, part of which I represent, and of cooperation between the public and private sectors in that endeavour. That is all very worthwhile, but considerations arising from the Bill are more mundane and worrying than that.
May I first discuss the drafting point that I put to the Secretary of State in an intervention. The right hon. Gentleman says that there is doubt whether, but for the Bill, the combination of section 137 of the Local Government Act 1972 and section 3 of the Local Authorities (Land) Act 1963 has the effect that some local authorities fear. I do not understand how there can be much doubt about that. Section 137 says, in effect, that one cannot use that section if one has powers, for a purpose, in another piece of legislation. The giving of assistance by means of grant or by loan are not separate purposes. The purpose is the same, although they are different devices. I do not understand how it can be argued that if one has power to give assistance for one purpose, but that it must be by loan on commercial terms, that is
370
not a purpose that embraces the provision of a grant. Presumably, such thinking induced local authority legal advisers to believe that a difficulty existed.
If we accept for the moment that the difficulty exists and that such legislation is not otiose but achieves a change in the law, my next question is: does it achieve a change in the law only for the future, or does it achieve a change in the law in respect of the past? I shall not discuss the drafting point at length, because we can debate it in more detail in Committee, hut clause 1 is drafted in a cackhanded way. It states:
"The powers conferred on a local authority by any enactment to which this section applies shall not be regarded as restricting the powers".
The flavour of the words
"shall not be regarded as restricting"
suggests a declaratory provision, not a law-making provision.
In addition, the fact that no date is specified for the coming into force of the Bill, other than when it receives Royal Assent, may support my interpretation. If it is declaratory, it is by definition retrospective in effect, in that we are declaring the meaning and interpretation to be put upon words that are already on the statute book. However, a court considering that point, which until now would have gone in that direction, would examine the long title of the Bill and see that it is a Bill to "remove certain restrictions". That wording suggests that it is not declaratory but that it will change the law from the moment the Bill comes into force.
I ask the Secretary of State, and the Minister who will deal with the Bill in Committee, to ensure that someone examines the wording to see whether it is respectably drafted. I suggest that it has not been so drafted and that a judge having to interpret the wording of the Bill as it stands would make the same criticisms as I have just made. It would be easy to find an alternative way of doing this. The sensible way would be to qualify the words "any other enactment", which are the last words in section 137 (1) of the Local Government Act 1972. The real purpose of the Bill is to say that those words at the end of section 137 (1) "should not include any other enactment listed in the following subsections." That is the nature of the change, and if it were done in that way the courts would find it much easier to follow.
I am slightly confused about the effect of the Bill, because the Secretary of State, naturally, chose to speak about it in the context of the principal topical use of the provisions. I may have done my homework wrongly—I hope that I shall be corrected if I have—but I believe that section 3 of the Local Authorities (Land) Act 1963 is a general provision. It does not always spring up only when the Secretary of State uses his powers to carry out the inner urban renewal operation about which he spoke. It states that whenever the local authority sells or lets land to a person for the purpose of erecting a building on it, it may provide loans at commercial rates to the person to whom it has sold or let it, but it cannot provide grants.
That situation can arise in circumstances entirely different from those to which the Secretary of State referred. Let us be rather far-fetched, although in the Eight of some of the things that some local authorities are doing, especially in Islington, my constituency, it is not so farfetched. Let us switch the party for the moment arid say that a Conservative local authority is selling a piece of land to the local Conservative association which has the

371
intention of building on that land a Conservative party headquarters. As I understand it, under the 1963 Act the local authority may advance, on commercial terms, money for the purpose of erecting that building—here my homework may be wrong—without the approval of the Secretary of State.
We are now saying that the local authority can not only advance money on commercial terms to the local Conservative association, but can make a grant to the local Conservative association, or a loan on soft terms, subject to all the general provisions about reasonableness, duty to its ratepayers, striking a balance and so on, that apply from the general law on local government. My point is that these provisions and the relationship between them have general significance and do not just become applicable in the context of current topical operations for inner city renewal, which is what the Secretary of State was talking about.
Mr. John Heddle: The hon. Gentleman referred to his homework. So that the House may be clear and follow his line of argument, does he agree that section 3 of the Local Authorities (Land) Act 1963 does not refer anywhere to "commercial terms"? If I follow correctly what the hon. Gentleman was saying, he was paraphrasing subsection (4) of that section, which says:
"An advance made under this section shall carry interest at a rate not less than one quarter per cent. greater than that fixed by the Treasury".
There is no reference to commercial terms.
Mr. Cunningham: I was using those terms as a paraphrase, as the hon. Gentleman suggests, but several subsections in the 1963 Act describe the terms upon which such advances can be provided. We can argue all day about whether those definitions constitute commercial terms, but they are a great deal more commercial than the provision of a grant or loan at 2 per cent. or something of that order. I prefer to continue using the phrase "commercial terms" if I may.
There is then the problem raised by the right hon. Member for Manchester, Ardwick (Mr. Kaufman) about the application of the Bill not only to the 1963 Act, which is listed in it, but to any local Act which the Secretary of State chooses in future to designate. I was surprised to receive from the Minister the answer to which the right hon. Member for Ardwick referred. If it is the intention of the Government immediately to designate some local Act or Acts under the Bill, the Department of the Environment should at least list those local Acts and should be in a position to say more to those who ask questions about this than that it will be entirely up to the local authority to bring forward a local Act applying to it and ask the Secretary of State to use his power in relation to it. No doubt we shall have an opportunity to go into that more thoroughly in Committee.
More generally, this is an odd time to expand the discretion of local authorities to spend money under section 137 of the Local Government Act 1972. Although the Secretary of State suggested that in a way this was actually limiting discretion under section 137 by saying that in so far as some things that are good can be done under the section, and that leaves less out of a 2p rate to be spent on undesirable projects, that begs the issue whether every new use of section 137 by reason of the Bill
372
will be good in anyone's opinion. To say the least, whenever there is a suggestion that the discretion of local authorities should be expanded and restrictions should be removed, the antennae should go up, not because I should wish to restrain the discretion of local authorities in general—it has been limited too much in recent years—but because the abuse of local authorities' spending power that is taking place at the moment is so offensive, so monstrous and so widespread.
The abuse is not only in London. The characteristics that were thought to be particularly restricted to London are spreading outside London. Local authorities are now using public funds for purposes which no one in the Labour party would have tolerated or supported for an instant up to just a few years ago. When the Labour Government were in power, there was no question of removing section 137 of the Local Government Act 1972, and there was no suggestion by the Government, of which the right hon. Member for Ardwick was a member, that local authorities should be free to spend anything that they pleased on whatever they thought was in the interests of their electorate.
It is significant that the spokesman for the Labour party on environment matters refuses to condemn, as does the leader of the Labour party, the use of public funds to finance the administrative costs of a purely Labour party series of meetings. It is unbelieveable. When one mentions this fact to old Labour party hands, who have been in local government finance for years, they fall about laughing at the very idea that it may be legal and that people have the gall to do it. Therefore, it is against the background of manifest and widespread abuse of current spending powers that we have to consider any proposal to expand those powers.
It would not be in order for me to go in great detail into the abuses that take place. I have had other opportunities to do that and I shall have further opportunities, but let us consider them in brief. At the moment in London, public funds—ratepayers' money—are being stolen to finance Labour party meetings. I refer to the so-called London Labour leaders' group, which is costing about 10 local authorities in London a small sum, approximately £2,000 each, to finance the salaries of two council officials who appear on the strength of Islington borough council, one in the secretaries department and one in the finance department and whose role will be to act as staff men to the London Labour leaders group.
This is breathtaking in its insolence. Let us imagine the Government saying that they think there should be some means by which they can consult local authorities, that this would be in the interests of the country, but that they would do it only with Conservative councillors and so they were setting up the Government—local authority consultative Conservative commission and the administrative costs would be taken half out of local authority rates and half out of national taxation. Would the Labour party sit silent? Would the Leader of the Opposition say, "That is all right by me; no objection to that; perfectly proper use of public funds and taxation and rates"? Would the right hon. Member for Ardwick sit quiet and not say a word about it? Of course not, because it would be wrong and they would say so. There is no difference between that and the financing of the London Labour leaders' group. But—and this is the most significant point in the context of the Bill—it is doubtful whether it is unlawful.

373
The provision for local authorities to spend on local government associations rests in section 143 of the Local Government Act 1972. I assure the House that I shall make this relevant to section 137. Section 143 states:
"A local authority may pay reasonable subscriptions, whether annually or otherwise, to the funds—

(a) of any association of local authorities formed (whether inside or outside the United Kingdom) for the purpose of consultation as to the common interests of those authorities and the discussion of matters relating to local government, or

(b) of any association of officers or members of local authorities which was so formed."

It does not say, "By the way, any such local authority association cannot be constructed on a political basis." Why not? Because no one ever imagined that local authorities would dare to put their hands into the public's pocket and take out money for Labour party meetings. Therefore, the statute does not specifically prohibit it.
I believe that it is, nevertheless, unlawful under the general provisions of fiduciary duties to the ratepayer and so on, and that it would be so held by a court. At the very least, there is a doubt. At this stage we do not know whether the district auditor in question will form the opinion that it is unlawful and, therefore, that the matter needs to go to a court.
That is one illustration of where our statutes are at fault, because they never anticipated that the Labour party would go as barmy as it has done and use public funds for these unlawful purposes.
Mr. Robin Maxwell-Hyslop: That is corrupt.
Mr. Cunningham: There are other things relevant to the Bill, such as the decision by Islington borough council to provide premises in Islington for occupation by the London Labour leaders group and to provide premises at Islington for occupation by a new free newspaper which will have an official link with the Labour party. I am not referring to the normal abuse of many local authorities of producing their own newspaper that sings a political tune. That is nothing. That is done in Islington as well. But that does not go far enough. Islington wants an allegedly independent newspaper, for whose editorial policy the council will have no responsibility, but which will support the Labour party line.
When an application for a grant to finance such a newspaper was put forward on the ground that it would create employment for about 10 people in Islington, that grant was provided. Just in the last week or two, decisions have been taken about the provision of premises in Upper street, Islington, for occupation by the staff of that newspaper. That is where the Bill comes in, because if Islington council were to sell a piece of land, on which a building were to be erected, to such a body, it would have to provide assistance on commercial terms.
Following the passing of the Bill, the council would be free to provide grants. Its power under section 137 would not be negatived by the fact that it had already sold a piece of land for such a purpose. We are dealing with a completely new dimension of abuse of public funds for political purposes.
At GLC level, we are all aware of the use of the so-called Londoner free newspaper. We also know that grants are being provided to endless numbers of organisations
374
whose purposes are, to say the least, bordering on the political and which are assisted for party political reasons rather than general policy reasons.
We are talking, not of only £1,000 or £2,000, but of hundreds of thousands of pounds, especially in London. When all that is going on, the least that should be done is to ensure that, when we expand any local authority discretion, we build a safeguard into the expanded discretion.
Unfortunately, that is all that I shall be free to propose in Committee. Because of the narrow nature of the Bill, I shall not be able to introduce a clause to prohibit political expenditure generally under section 137. That would be outside the scope of the Bill. However, I can certainly move that such a restriction should apply whenever the expanded discretion created by the Bill is employed. I shall move an amendment to achieve that purpose.
The scope of such an amendment will, however, be extremely narrow, and in practice it will probably never operate. We need a provision that prohibits the political use of public funds generally under section 137. That cannot be done by myself or any other hon. Member, nor can it be done by the Government, even as author of the Bill, because it would still be out of order. That is what irritates me intensely.
When the Department of the Environment knew that a Bill on local authority expenditure powers was to be introduced, and in view of the abuse that is now taking place, it should have said, "We will take this chance, because God knows when we will have another suitable Bill in which we can insert a clause to prohibit the misuse of funds for political reasons." That is what ought to have been done. The Government, even after today's Second Reading, should take the Bill away, stop the Easter holiday of the officials and draftsmen concerned, and get them to produce a clause that prohibits the worst abuses of the use of public funds for political purposes.
If the Bill is taken away and brought back with such a clause, we shall be in business to pass the clause on to the statute book. If the Bill remains as it is, that cannot be achieved, because of the rules of the House. However, there is always the House of Lords, but it would not be sensible to rely on the House of Lords to do so, even though it has no rules and can do more or less what it pleases.
During the last week I put that suggestion to a number of people, including the Prime Minister, and I regret to say that the answer I received just immediately before the debate began was that she thought that the job was too great to be achieved in the time available. A decision will have to be taken in the time available on my amendment to prohibit political expenditure within the confines of the expanded discretion created by the Bill. Therefore, no additional effort is needed to make up one's mind about prohibiting political expenditure in the context of the use of section 137. The Government must make up their mind whether to accept my amendement or to resist it. If there is a majority on the Committee in favour of it—which I hope—the Government will have to live with the result, and if they can do that on a narrow front, they can do so on a much broader front.
The Government have lost a great opportunity to prohibit the worst abuses that are occurring at present. With the best will in the world, they could not have introduced a Bill that cleared up the whole issue. I

375
recognise that if they were to expand the Bill to that extent it would never get through before the end of the Session. I merely ask for a modest change to be made.
In justification for the rush, I invoke some of the recent judicial decisions that have been taken, for example, about the use of council newspapers for political purposes. The Minister was kind enough to refer me to some of those cases. I refer him back, as it were, to what seems to be the conflicting cases of the Lothian Chronicle and the Greenwich Civic News, where one decision indicated that very political argumentation in a locally financed newspaper was legitimate and the other case suggested that it might not be.
We are all the time encountering the failure in the past to prohibit such political things, and I doubt whether we have succeeded in prohibiting them in past statutes. This issue cries out for legislation, and until we have that legislation we shall have Labour authorities in London—the GLC, ILEA, Islington and many others—helping themselves to the public's money for party political purposes.
It is an urgent and crying scandal and there is still an opportunity to correct it if Conservative Members will persuade the Government, after the Bill's Second Reading, to bring back the Bill in three weeks with the addition of just one clause to remove the opportunity for the worst of the abuses.
5.30 pm
Mr. John Heddle: The House always listens with great interest to the contributions made by the hon. Member for Islington, South and Finsbury (Mr. Cunningham). His knowledge of the Chamber and of the constitution is written at least into the political history of the 1970s and will be read by students of politics for many years to come.
I have some sympathy with the general argument of the hon. Member for Islington, South and Finsbury. Those of us who are London ratepayers and contribute to the GLC's antics must be concerned at the sheer abuse of ratepayers' money in the hands of Mr. Livingstone and his friends across the water. They have no experience of business or of balancing books, and to them prudent finance has no definition.
I must cross verbal swords with the hon. Member for Islington, South and Finsbury when he illustrates his argument by referring to section 3 of the Local Authorities (Land) Act 1963. The House will recall that the hon. Gentleman said that that Act gave local authorities the power to make grants. He used the example of a Conservative-controlled council making a grant to a Conservative club. I may not have done my homework as thoroughly as I should, and I stand to be corrected, but, having read and reread section 3 several times, I can find no reference to "grant". The phrase "advance money" is used in section 3(1), and subsection (4) states:
"An advance made under this section shall carry interest at a rate".
Subsection (5) refers to the mortgage deeds "securing an advance" and lists the conditions that should be attached to the mortgage. Nowhere in clause 3 can I find any reference to "grant".
Mr. George Cunningham: I intended to say that section 3 of the 1963 Act does not at the moment allow
376
a council to give a grant or soft loan. But, after the Bill that we are now considering is enacted, a council will be free to do so because its powers under section 137 will be liberated, not nullified, by the existence of section 3 of the 1963 Act.
Mr. Heddle: I am grateful to the hon. Gentleman for that clarification. It confirms that I did not misunderstand or misinterpret section 3. However, it seems that I misunderstood what the hon. Gentleman was saying. It appears that the hon. Gentleman's argument could be met by a qualification of section 137 to ensure that any advance, whether by way of a loan, mortgage or grant, should be strictly for non-party-political purposes. I believe that there is a way through this legislative wood but, as I am not a lawyer, I shall stand corrected if my hon. Friend the Under-Secretary of State tells me when he replies that he is advised by his officials that a qualification of section 137 is not the appropriate route. If it is not, I agree with the hon. Member for Islington, South and Finsbury that the issue should concern us deeply.
I understand that the Bill has been introduced by my right hon. Friend the Secretary of State for the Environment to remove any doubt in law about the power of local authorities to make grants under section 137 of the 1972 Act, as amended by the Local Government (Miscellaneous Provisions) Act 1982. Doubt arises about the relationship between that section and other local authority powers, because section 137 cannot be used for a purpose for which a specific power already exists.
The powers of local authorities under the Local Authorities (Land) Act 1963 to make loans for industrial developments on their own land were extended to cover loans for the acquisition of land or buildings on any land by section 43 of the Local Government (Miscellaneous Provisions) Act 1982. I am certain that doubt arises in my right hon. Friend's mind as to whether the extended powers to make loans preclude the use of section 137 to make grants for such purposes.
The difficulty seems to arise where local authorities wish to grant aid for land acquisition and building works for projects approved for urban development grants. The House should not lose sight of that fact.
I accept that the abuses to which the hon. Member for Islington, South and Finsbury referred will continue until the loophole is closed. However, I hope that the House will not throw out the baby with the bathwater. As my right hon. Friend said when introducing the Bill, the intention is to ensure a breath of fresh air and the introduction of realism into the inner cities, the take-off of urban renewal, the creation and refurbishment of homes, the building of factories and, most importantly, the creation of jobs.
The decay of the inner cities started when private sector capital flew to the more amenable pastures of the suburbs and new towns—areas where local authorities encouraged industries to locate themselves, to start up in business and to create jobs and wealth. Those authorities did not wish to cane commerce or industry by levying absurdly high rates on empty business premises.
Private sector capital went to the suburbs and the new towns because the Labour party, in the late 1960s, sought to nationalise land, to stifle the free market and to reduce the availability of land for industrial and commercial development by the introduction of the Land Commission Act 1967, which the incoming Conservative Government of 1970 rightly repealed. The Act was seen in three short

377
years to be impotent, to stultify development and to stifle urban renewal. The Government are now grasping and grappling with the problems of development and urban renewal with considerable success. Their predecessors having been beaten, the next Labour Government implemented the Community Land Act 1976. Again, their legislation had the same effect—no land, no new investment in the inner cities, no homes and no jobs.
Mr. Tim Sainsbury: And no hope.
Mr. Heddle: And, as my hon. Friend says, there was no hope for those who lived in the inner cities. In the words of Vera Lynn, "When will they ever learn?"
So we find in the Labour party's manifesto, which was thrust across the Table yesterday afternoon, a reference to the inner cities. We now know what the right hon. Member for Manchester, Ardwick (Mr. Kaufman) and his team think. The manifesto states:
"The decay, squalor and level of unemployment in our inner cities are a national disgrace."
Yet the right hon. Gentleman fiddled like a political Nero when he was in Government and did nothing whatever about it. it goes on:
"Labour is determined to reverse their decline. We will provide more resources, more investment and more jobs. We will act to ensure, through the policies set out in this campaign document, that people living in the inner cities have access to decent homes, health and education—and that there is proper accountability for the police."
Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. I hope that the hon. Gentleman will relate his comments to the Bill. I am having difficulty in seeing their relevance at the moment.
Mr. Heddle: I anticipated your remarks, Mr. Deputy Speaker. According to my interpretation of section 137, my remarks are relevant. I was endeavouring to say that for the inner cities to live again and for urban renewal to take place and take place quickly, the private sector, not the public sector, should be providing the money. It should not be the case that, in the words of the Labour party's campaign document,
"The decay, squalor and level of unemployment"
should be overturned by providing more resources from the taxpayer and the ratepayer. That can be achieved only by creating a mixed environment where home ownership goes in partnership with public ownership and where the private and public sectors can work in harmony for the good of the community and those who live in the inner city areas.
That is why I welcome the statement of my right hon. Friend the Secretary of State at the Dispatch Box, that in 1982–83 the Government have provided £350 million for urban development and derelict land grants and that in 1983–84 they propose to invest a further £423 million. That contrasts vividly with the £160 million that was provided by the right hon. Member for Ardwick before the Labour Government left office in 1979.
As a Member who represents a west midlands constituency, I welcome the statement by my right hon. Friend that a further £32 million is to be invested by the public sector and that four and a half times as much will come from the private sector, particularly to revitalise and renew parts of Birmingham and Sandwell. In Birmingham, £674,000 is to be given to a company to enable it to demolish an obsolete factory and construct light industrial units for much-needed jobs in the inner
378
city. Furthermore, another company is being given £300,000 to convert and refurbish obsolete industrial buildings to provide small workshop studios and units to provide much-needed jobs in the Spencer street and Augusta street areas of Birmingham. In Sandwell, £3·4 million has been given today by the Department of the Environment to reclaim a derelict site and to build 152 low-cost homes for sale in the Dudley road west area of Tividale. The inner cities can be revitalised and renewed by the use of public money, but with private capital playing its part to provide small workshop units—the seedcorn industries of tommorrow—and opportunities for employment and self-employment in the inner cities. It is the lack of employment opportunities that has caused the inner cities to die.
The right hon. Member for Ardwick quoted from a letter sent to him by the Association of District Councils. It rightly said that the Bill raises the wider question whether local authority expenditure on urban aid schemes approved by my right hon. Friend the Secretary of State should be excluded from section 137 altogether. Some inner urban area programme authorities—the right hon. Gentleman referred specifically to Leicester and Nottingham—are already finding difficulty in containing their expenditure on approved schemes within the 2p rate limit. I have no doubt that that is a matter that my right hon. Friend the Secretary of State and my hon. Friend the Under-Secretary of State will wish to debate further in Committee. However, the way through the problem—there is clearly a problem of definition here—is not by the irresponsible commitment that was made this afternoon by the right hon. Member for Ardwick—to give local authorities powers of general competence. I challenge the right hon. Gentleman to define here and now at the Dispatch Box precisely what "general competence" means and how it can be enshrined in an Act of Parliament.
Mr. Peter Bottomley: The right hon. Member for Manchester, Ardwick (Mr. Kaufman) should relate that to the recent activities of councils such as Greater London, Greenwich, and others in north London. He has remained remarkably silent through a small litany of some of the things that they have been doing. I do not know whether my hon. Friend can get him to say whether he supports such activities or whether he intends to maintain a becoming Trappist silence. Does my hon. Friend agree that to talk about general competence, when the whole issue has arisen because of the incompetence and political motivation outside the general responsibilities of Labour authorities, ill becomes local authorities and Labour Front Bench spokesmen who remain silent?
Mr. Deputy Speaker: Order. We must do that within the ambit of the Bill.
Mr. Heddle: I am particularly grateful for the intervention of my hon. Friend the Member for Woolwich, West (Mr. Bottomley). He inspires me to challenge again the right hon. Member for Ardwick to answer the point that not only he but the hon. Member for Islington, South and Finsbury raised. The right hon. Gentleman's silence is telling.
There is a role for the local authority to act as a site assembler to enable it to bring together all the strands of the development process and to enable the private sector to provide the homes and jobs that the inner cities need.

379
However, we must bear in mind that the prospective tenants of the small workshop units in Birmingham and Sandwell will not usually have had experience of business and therefore will not necessarily be as acceptable as commercial covenants to banks, building societies and pension funds as more established operations and industries might be. My right hon. Friend the Secretary of State might consider with my right hon. Friend the Secretary of State for Industry whether the Government could extend the small business loan guarantee scheme to enable new industries to take leases on factories and workshop units developed not necessarily by the local authority but by the private sector. The Government could protect the developer, the investor and the fund from any risk that might exist as a result of letting premises to inexperienced and first-time business men by introducing some form of covenant guarantee scheme.
Surely the way to solve the problem is more clearly to define the powers and terms of reference of the district auditor. Should not my right hon. Friend the Secretary of State outlaw any activity by a cowboy council that is seen to be squandering the ratepayers' money on overt and blatant party political materials and activities? With that proviso I welcome the Bill.
5.48 pm
Mr. Sydney Chapman: You will be the first to remind us, Mr. Deputy Speaker, that the Bill is narrowly drawn. It seeks to amend section 137 of the Local Government Act 1972 to
"enable local authorities to provide financial assistance towards the acquisition of land, or the carrying out of building works on land, in a form other than that provided for by section 3 of the Local Authorities (Land) Act 1963."
Unfortunately, in one sense it is not a local government miscellaneous provisions Bill. It it were, we could raise anything relating even remotely to local authorities.
The House will be aware that when the Local Government (Miscellaneous Provisions) Bill was introduced I was one of a number of hon. Members successful in getting the Government to agree to a new clause for the licensing of sex shops. I trust that within the ambit of this Local Authority (Expenditure Powers) Bill I shall be allowed a make a brief remark about the expenditure of the Greater London council.
I am impelled to follow the hon. Member for Islington, South and Finsbury (Mr. Cunningham) who has done the House a service by raising the matter of the total abuse by the GLC of ratepayers' money for overt party political propaganda. Although I do not disagree with the hon. Gentleman, I fear that he is being a little too optimistic in believing that the House could necessarily define what "party political activities" means. Many people have referred to the district auditor in London certain aspects of the expenditure of ratepayers' money by the GLC on various propaganda issues. The district auditor gave the determination that the GLC was not acting outside the law.
I trust that my hon. Friend the Minister will seriously consider whether a suitable clause can be added to the Bill. If it cannot be done—if I am on the Committee I shall keep an open mind—I trust that the hon. Member for Islington, South and Finsbury and others will be aware that, to my knowledge, many hon. Members on this side of the House, who do not hold office, wish to press the Government to
380
give a commitment to introduce in the next Session a Bill of the kind suggested by the hon. Member for Islington, South and Finsbury, whether that be this side or the other side of the general election. In a bipartisan spirit, many hon. Members will be indebted to the hon. Member for Islington, South and Finsbury for what he has said.
I agree with the hon. Member for Jarrow (Mr. Dixon), who said that it was wrong for Ministers to talk solely in terms of inner city problems. The term "inner cities" is a geographic misnomer for what I believe the Government are trying to do and what previous Governments were trying to do in bringing specific help to certain geographically defined areas of the country with acute social and environmental problems.
Will the Government seriously consider dropping the phrase
"urban development and inner cities"
and finding a more specific phrase to deal with this geographic, social and environmental problem? I suggest "special priority areas". As everything must have an acronym, "SPA" would not be entirely unsuitable to draw attention to a pressing need for central and local government action.
I welcome the Bill, however narrowly defined it is, because it is yet another instance of underlining what I believe to be the key to the solution of the problems that face these special priority areas. If the Government are to have the remotest chance of being successful, it is essential to have a partnership between local authorities and the private sector. The local authorities will probably own the land that needs redeveloping or utilising, and they have the prestige and confidence of the local inhabitants to carry out the necessary works, while the private sector has the financial capability to assist local authorities and the entrepreneurial skills of developers. That is of fundamental importance.
This Bill is yet another one which underlines the fact that our local taxation system must be examined and reformed. The rating system is illogical, unfair and out of date. It is illogical, because people do not necessarily pay according to the services that they use; it is unfair for patently obvious reasons, which I need not deploy on this occasion, and it is out of date because, in any case, almost 60 per cent. of total local authority revenue comes from the Government by way of a rate support grant allocation. Until the Government tackle the iniquities of the rating system we shall never be able to do the things that could be done and urgently need doing, in a partnership between local authorities and the Government or local authorities and the private sector if our towns and cities are to become decent places in which people can live and work.
5.56 pm
Mr. Tim Sainsbury: I welcome the opportunity to return to debates involving Department of the Environment matters after a period of enforced silence. I had a reason for my silence. I regret that the right hon. Member for Manchester, Ardwick (Mr. Kaufman) remained silent without reason when challenged on whether or not he supported and approved of the activities to which the hon. Member for Islington, South and Finsbury (Mr. Cunningham) and my hon. Friends have drawn attention. The silence of the right hon. Gentleman is less excusable than mine on this subject.
I intervene briefly to welcome the intention of this Bill to remove any element of doubt associated with the

381
operation of urban development grants. The urban programme in its various forms goes back a long time. When I examine the conditions in some of our inner cities I wonder whether what has been done up to now is satisfactory. My hon. Friend the Member for Chipping Barnet (Mr. Chapman) put his finger on the weakness by saying that until now the expenditure had been made by the Government and by local government but had not brought into partnership the private sector. The partnership concept is the best and most effective way forward and is the element that has been lacking in the programme.
The urban development grant is a splendid new initiative. I will quote from a pamphlet written by the former Secretary of State for the Environment. He referred to the urban development grant as being able
"to encourage imaginative projects to come forward. No restrictions are placed on the type of project that can be submitted for grant. They can be industrial, commercial, housing, recreation, sporting schemes or a combination of any of those."
The way forward it to seek the maximum flexibility and, more importantly, the maximum involvement of private sector capital that gives not just the gearing but the variety and speed of the initiative.
The announcement made today by the Secretary of State for the Environment has brought the urban development grant to a total of £82 million of investment for the coming year but will use only £16 million of Government money. That is a tremendously effective way of getting jobs, activity and vitality back into our inner cities. In addition, it leaves us with more urban development grant to use on similar, imaginative projects in the years to come. On that point, I entirely welcome the Bill and am very much in favour of the urban development grant as an additional weapon in the armoury of initiatives that are being used so well by the Government in tackling the formidable problem of inner cities.
Like some of my hon. Friends, I think that the hon. Member for Islington, South and Finsbury (Mr. Cunningham) has done the House a service in drawing attention to the serious problem of the widespread abuse of ratepayers' funds by certain authorities on the far Left, for party political purposes. It is an abuse on which the right hon. Member for Ardwick remains curiously, and perhaps uncharacteristically, silent. He tends to go overboard when he is speaking, but this time he is going overboard by remaining silent. There is undoubtedly a serious abuse, but I am not sure that the Bill is the best means of dealing with it, because, as my hon. Friend the Member for Chipping Barnet said, there is the difficulty of definition. We may first need wider exposure of the funds. If there is any suggestion of those funds being used for party political purposes it might be necessary to make special publication provision and to make them the subject of a full debate, and if necessary a debate in full council. At least that would bring the issue into the open and might make it easier for the district auditor to give it his attention.
Mr. George Cunningham: The hon. Gentleman said that there was some difficulty in getting at the facts. However, there are problems. Indeed, at the moment people have problems in Islington because of that council's excessive secrecy. Normally, one does not have any difficulty in getting at the facts. The difficulty lies in having the situation corrected. I accept that the words used to define "party political activity" might present a
382
problem, but it is better to accept that problem and to leave it to the courts to decide—as we usually do—than to ignore it.
Mr. Sainsbury: I accept what the hon. Gentleman has said about not addressing the problem. I query only whether this Bill is the right means. However, I am not sure that I entirely agree with the hon. Gentleman about the ease of getting at the facts. I have made inquiries, and there are other councils, in addition to Islington, that seem to adopt excessive secrecy in their approach to such matters.
I hope that my hon. Friend the Under-Secretary can at least reassure the House that the problem is being given urgent attention. If the Government do not feel that the Bill is the right vehicle for taking action, I hope that they will seek an early opportunity to do something about a situation that is clearly of justified and increasing public concern.
6.2 pm
Mr. Peter Bottomley: I wonder how the right hon. Member for Manchester, Ardwick (Mr. Kaufman) would feel if the Government paid for a free newspaper to be delivered to every household in Islington, Greenwich and within the GLC, spelling out exactly where the Government disagreed with those councils, listing the items that they had spent money on and calling on local ratepayers, residents, employers and employees to take effective action to stop the abuses that the Government saw in those local authorities. The right hon. Gentleman would be up in arms. He would end his silence and would campaign vigorously.
At present, local authorities—presumably using section 137—are doing just that. The hon. Member for Woolwich, East (Mr. Cartwright) and I have seen local authority vehicles in our borough going around with anti-Government signs on them. If the right hon. Member for Ardwick went to Wellington street, SE 18 and looked at the town hall, or Peggy Middleton house, he would see a sign saying "Defend London from Heseltine". I do not know whether that is a hangover from my right hon. Friend's period at the Department of Environment or whether it refers to his new post at the Ministry of Defence. If the reverse were true and every Government building had a sign saying "protect London from Livingstone", or "protect London from Islington borough council", the right hon. Gentleman would be on his feet and would no longer be silent.
I must admit that the right hon. Member for Ardwick normally writes better than he speaks, although we saw a smile from him in the middle of his speech today, which is a rare sight. I borrowed the right hon. Gentleman's book "How to be a Minister" from a clergyman who had been given it by a parishioner who had not looked inside, but had seen the title. We know from his book that the right hon. Gentleman spent his time in government defending planning agreements. When he was a Minister I attacked him on that and tried to find out what they meant. However, we had to wait three or four years for an answer. We had to wait until he had written guidance for other aspiring Ministers, to discover that he did not know what he was doing at the time. Indeed, he did not discover what he was doing even after he had asked the person who had cooked up the idea and sold it to the Labour party.
The right hon. Gentleman has given us a preview of what any future Labour Government would do. They

383
would expand the spending powers of local authorities within what he calls their "general competence". If that ever came to pass, we would no doubt discover, four years later, that the right hon. Gentleman—who is very honest and open—did not know what he was doing. Today, he has not reacted to our invitations to give his own comments or those of his party on some of this excessive and perverted spending. I use the word "perverted" in the strict sense of spending ratepayers' money on items that are clearly not expected of local authorities, and using it in such a way as to put up the backs of many people, including Labour supporters, who would regard such spending as unjustifiable and inexcuseable.
The right hon. Gentleman is not supported by any Labour Member, because nearly every other Labour Member of Parliament cannot stomach hearing what some Labour local authorities are spending money on. They cannot defend the rate increases that Labour authorities impose on many of their poor old ratepayers—both commercial and domestic. That is at least true in London, if not in other areas of the country.
This Bill seeks to lift restrictions on local authorities. Many people would think that it was more important to impose restrictions on many of our local authorities because of the level of their spending and the purposes for which that expenditure is used. The Bill has been approved and put forward by Ministers in the same way as a Minister who is given a pair of brown socks to wear with a grey suit might then put them on without realising what was going on. I hope that my hon. Friend the Under-Secretary of State will at least try to see whether the criticisms that have been made of the Bill on both sides of the House can be remedied, either in this Bill or in another.
The element of doubt that may apply to urban development money is not anything like as important or as urgent as the large rate increases that we have seen, or the way in which local authority money is spent. I return to the views—or absence of views—of the right hon. Member for Ardwick. If a Tory GLC decided to spend £500,000 on promoting the possession of nuclear weapons against Government policy, would he regard that as being within their general competence, either under present law or under the law that we have been promised by a possible future Labour Government? I do not know whether the right hon. Gentleman has given thought to that. If he has not done so, he has not considered his new proposed powers seriously enough. If he does not know whether it would be legal or right under present powers, I can understand why he does not want to comment on what the Labour-controlled GLC spends its money on—which is, of course, exactly the reverse.
I do not want to go into the merits of nuclear weapons, but the right hon. Gentleman and his colleagues should state their view on whether a metropolitan local authority should spend a vast amount of its ratepayers' money on such a campaign. Is the right hon. Gentleman satisfied with the way in which the GLC is spending its money on that issue? Would he be satisfied if a Conservative-controlled GLC did exactly the reverse? He has already been challenged about how he would feel if several Tory-controlled local authorities got together and gave ratepayers' money to a Conservative leaders group, using
384
premises and meeting rooms and spending money on staff to provide a back-up. Is that really the sort of thing that any right hon. Member should keep quiet about?
The right hon. Gentleman has had many opportunities to comment. Is he ashamed to comment? Does he not have a view, or does he believe that the House of Commons is not the place to give it and that it is better to wait until the Labour party conference where he can stand up and say, "I kept silent on 30 March against partisan attacks from those who do not believe that a Labour authority should spend ratepayers' money on purely party political groups."? We are waiting for an answer. It appears that we will have to go on waiting for an answer. We have a second smile from the right hon. Gentleman but absolute silence. Is it that he and other Labour Members want a packed audience of those who agree with them before they are willing to speak on these issues?
Mr. George Cunningham: I hope that the right hon. Member for Manchester, Ardwick (Mr. Kaufman) is not expecting to reply to these points later in the debate. It would be entirely wrong for the Labour party alone to speak twice in the debate. Therefore, it is important that the right hon. Gentleman should respond immediately to these questions by means of an intervention.
Mr. Bottomley: Not only would I be willing to give way to the right hon. Gentleman but I am sure that he would have the leave of the House to speak again. Sadly, no other representative of the Labour party is willing to give a view. The right hon. Gentleman is alone. The issue is apparently important. If it were not important, a growing number of Labour authorities would not be using the present powers in ways which are clearly rejected by most other Labour local authorities and by most people with common sense and a sense of fair play about how ratepayers' money should be used.
It is curious that there appears to be greater power over the political funds of trade unions—or the non-political funds of trade unions—than over the non-political funds of local authorities. I believe that the rules governing the powers of certification officers over trade unions are not strong enough. I certainly believe that the powers over the new trend in political spending of local authorities should be tightened.
I ask my right hon. and hon. Friends to use the Bill, if they can, as an opportunity to bring more attention to the issue and to put that right, as the case has not been properly made in the explanatory memorandum of the Bill:
"The Bill is intended to clarify the purposes for which those sections may be used and no significant additional expenditure under those sections is expected to result from the Bill."
No significant expenditure was expected on party political propoganda and for party political purposes under the other provisions which govern local authority expenditure. No Labour authority believed five years ago that it would get away with half of what authorities appear to be getting away with at present.
Mr. John Cartwright: The hon. Member for Woolwich, West (Mr. Bottomley) will know that the co-ordination of Labour local government in London is nothing new. Regular meetings have taken place between Labour leaders in London for several years. Co-ordination took place regularly when I was the chief whip of the Labour group on the London Boroughs Association. In those days the Labour party paid for it out of party funds and not out of ratepayers' money.
Mr. Bottomley: Perhaps the Labour party is running out of funds. The headquarters of the Labour party at Walworth road may sack another 25 of its staff. Will the Labour party then go to the local authority and ask for employment protection money? Will the Labour party ask the local authority to buy the headquarters building and then rent it back at a low rent, or perhaps ask for a soft loan to maintain employment? Does the right hon. Gentleman think that that would be within the "general competence" of the local authority, either now or in the future?
We are beginning to see a slackening of the proper controls over local authority spending and over the purposes of that spending. As the Bill is concerned with lifting restrictions on local authority expenditure, there should be more controls on spending. I shall not spend too much time on this issue because, although it would be in order, it is slightly beyond the purposes of the Bill. Does the Minister believe it appropriate that rates in the London borough of Greenwich should increase by 30 per cent? Can he respond to those of my constituents who wish to see restrictions over such inflationary job-destroying and confidence-destroying rate increases?
I carried out a survey among small businesses in Greenwich and discovered that many of them were paying between £12 and £24 a week in rates for each employee. For rates to go up by 30 per cent. in one year with the same rate of increase expected in future years—
Mr. Deputy Speaker: Order. I am not certain that the Bill has anything to do with that.
Mr. Bottomley: The Bill removes some of the expenditure controls on local authorities. If the Government are putting forward the case for lifting some of the restrictions, I believe that I should be able to put forward the case for opposing some of the restrictions or should at least be able to ask whether the proposed lifting of restrictions is sensible. That is a perfectly normal Second Reading procedure.
A rates increase of 30 per cent. this year with a possible 30 per cent. increase next year to make up for the robbing of the balances and to pay for some of the continuing expenditure to cover new commitments of the London borough of Greenwich is a reasonable issue to put to my hon. Friend. If he cannot answer in this debate, I hope that he and the Government take notice of the representations, the protests and the anguish of my constituents and the ratepayers in the London borough of Greenwich.
I received a letter from a pensioner today which said that, while the pension increase was welcome, it was far outweighed by a rates increase of more than £100 a year. The right hon. Member for Ardwick quoted from the proposed Labour party programme—the emergency programme—as though it will do good for pensioners. Those pensioners are suffering because of Labour authorities in the town halls, and are already seeing the penalties of a split anti-Labour vote, having given control, even though only temporarily, to a Labour council which has moved to the Left. The right hon. Gentleman will wake people up so that more of them will vote for the party of the hon. Member for Woolwich, East (Mr. Cartwright) or for the Conservatives. Too often people have not believed the Labour party. I hope that they now will.
I am sorry that my speech has been relatively brief but I think it would be in keeping with the mood of the House if I conclude fairly soon. I have not been able to tempt the
386
right hon. Member for Ardwick to his feet to give his views on this subject. My hon. Friend the Member for Lichfield and Tamworth (Mr. Heddle) made a small mistake. Vera Lynn did not say, "When will they ever learn?". I think it was Pete Seeger who said that. I believe that most of the ratepayers of London are now beginning to learn. Regardless of who first used the words, the ratepayers will say, "We do not want Labour; we do not want extra powers for local authorities, apart from the minor provisions intended in the Bill; we want Labour to go and we want political spending stopped."
6.18 pm
The Under-Secretary of State for the Environment (Sir George Young): I feel slightly inhibited about replying to the debate, because far more questions have been asked of the right hon. Member for Manchester, Ardwick (Mr. Kaufman) than of the Government. None the less, I welcome the right hon. Gentleman's support for the Bill. As a simple housing Minister, I shall not follow him down the intricate path of local government finance. That has always been complicated, and if some people tell me that it is less complicated now than it was, I am happy to believe them.
The Bill is needed not because of any problem for the Secretary of State but because of problems for local authorities, as the right hon. Gentleman recognised. The local authorities came to the Government after the announcement about urban development grant to express their anxieties about their powers to pay. In order to maintain the cordial relationship which we enjoy with local authorities we have decided to help them by means of the Bill.
With regard to consultation, because of the need to make swift progress, there was little time to consult the local authority associations but we did keep them fully in touch with what we were intending to do. Local authorities have been informed about what we are doing and, of course, it was the local authorities which asked us to amend the law in the first place.
The Bill does not have retrospective effect. It will have effect in the financial year in which it is enacted. If local authorities are worried about past payment, my right hon. Friend the Secretary of State would be prepared to consider sanctions under section 16l of the Local Government Act 1972 in appropriate cases.
One can only sympathise with the problems facing the hon. Member for Islington, South and Finsbury (Mr. Cunningham) in the London borough of Islington. Et is worth pointing out that all three Islington Members have resigned from the Labour party—due, no doubt, to the activities of the Socialists on Islington council.
Specific questions have been asked about local act powers. We cannot anticipate what provisions in local acts might obstruct section 137 and the paying out of money for urban development grants. We have a long list of local authority acts that contain powers to assist industry, but it would not be practical to list them all, because we might leave some out. That is why we need clause 1(2)(c), which gives power to the Secretary of State to designate enactments within local acts. Clause 1(3) enables the Secretary of State to apply the clause to the enactment
"only to such extent as is specified in the order."
The hon. Member for Islington, South and Finsbury mentioned the possibility of a Labour council in Islington, with the connivance of a Labour Government, giving

387
money to support a Labour club. The sale of land to a party political organisation by a local authority could not be financially assisted under section 137. It is doubtful whether such assistance would be properly for the benefit of local authorities and all or some of their inhabitants. The district auditor would investigate such expenditure very quickly.
I am grateful for the support of my hon. Friends, who have welcomed the Bill. My hon. Friend the Member for Lichfield and Tamworth (Mr. Heddle) asked me to follow up certain points with the Secretary of State for Industry, which I shall do. He asked me about the district auditor. There are powers for the district auditor to conduct an extraordinary audit. There was an Adjournment debate on that matter, in the context of Islington, a few days ago. Various items of expenditure have been referred to the district auditor, some by the hon. Member for Islington, South and Finsbury. The Government are considering the case for an extraordinary audit of Islington in the light of information that has been made available to us.
My hon. Friend the Member for Chipping Barnet (Mr. Chapman) supported the case for a review of the laws on political activity. He also asked the Government to take on board the problems of areas that were not necessarily inner city areas. Any local authority can apply for an urban development grant. The Government are currently reviewing regional and inner city policies, with a view to ensuring that they complement each other and that there is consistency and coherence.
It was a pleasure to hear my hon. Friend the Member for Hove (Mr. Sainsbury) speaking once again on environmental matters. He asked how one defined political activity. Political parties are not referred to in local government legislation. There are problems in defining political activity because, in a sense, anything done by a local authority that is controlled by politicians is likely to be political. That is one of the problems with the suggestion to tack on to the Bill a slightly broader clause to inhibit certain expenditure under section 137.
My hon. Friend the Member for Woolwich, West (Mr. Bottomley) has to put up with a Left-wing council in Greenwich that has harrassed people who want to exercise the right to buy. Were Livingstone ever to become a Minister, he would have no hesitation in using taxpayers' money to finance propaganda with the same profligacy that he currently uses ratepayers' money in London.
Mr. Peter Bottomley: The GLC is spending money on the campaign against nuclear weapons. Parliamentary election expenditure is strictly controlled, yet £500,000 is being spent to support what appears to be one of the four legs of the three-legged stool of the Labour party. That must be stopped. Labour party money is being spent in an attempt to have its own people elected by converting people to its views.
Sir George Young: My hon. Friend raises two points—whether such expenditure is legal and, if it is legal, whether it should be so. The first point is for the district auditor, not the Government. The second point raises broader issues about which I shall say something later.
I do not think that anyone wishes to impede the progress of the Bill. The hon. Member for Islington, South and Finsbury has written to me supporting a scheme for urban
388
development grants in his constituency. All hon. Members who have spoken have been anxious to see the UDG scheme get off the ground. It would be unacceptable for the introduction of a major Government initiative to be endangered by what are essentially technical legal doubts about the scope of section 137.
Some hon. Members, including my hon. Friend the Member for Woolwich, West, felt that the Bill should have gone wider. We will take on board what they have said today. Broader issues have been raised about the activity of some Labour authorities, especially in London, which we shall wish to look at a great deal more closely.
In saying that, I repeat the promise made last year during the debates on the Local Government (Miscellaneous Provisions) Bill. We made it quite clear then that we would want to keep a close eye on the use authorities made of their new powers and see how appropriate they were in a rapidly evolving situation. Section 137 has always been a widely drawn power; the great diversity of projects funded by it—not just in industry and commerce—demonstrates fully the value in which it is held by local government.
I share the concern that has been heightened by the activities of the GLC and Islington. That has led to calls for restrictions on section 137. But we must not lose sight of the original reasons why we accepted the need for flexibility. Many of the schemes that are undertaken using section 137 powers have the direct financial backing of Government—whether in the main urban programme or by way of UDG, and they cover a wide range of projects. We reaffirmed our view last year, following extensive consultations and discussions in this House and in another place, that authorities do have a legitmate role to play in assisting economic development, especially in helping to encourage small local firms which cannot always take full advantage of the regional incentives offered by Government. We were helped in reaching that conclusion because it was clear from the consultation exercise that local government, for the most part, agreed that its activities should be complementary to those of central Government, and not in opposition to them.
Whether the fact that that freedom has been abused should lead to a general restriction on section 137, is not the matter before the House today. If that was tacked on to the Bill, it would only impede its progress and arrest the implementation of urban development grants. I do not think that any hon. Member wishes that to happen.
Our immediate aim in tabling the Bill is to ensure that no doubts remain about the introduction of urban development grant. The creation and retention of jobs, especially in the construction industry, is one of the key benefits which my right hon. Friend had in mind in approving UDG projects. The 41 projects he has already announced could bring up to 1,000 immediate construction jobs and could retain or create 2,800 permanent jobs in the longer term. Insofar as the Bill enables some of those projects to go ahead which might have been held up it will certainly help employment.
Some hon. Members have rightly pointed out that the Bill marginally widens the scope for local authorities' own programmes of economic development. There is however, nothing objectionable about the use of section 137 to provide, for example, grants for industrial property development by the private sector where a local authority judges that to be in the best interests of its area. I regard

389
that as no more than the legitimate exercise of local direction. That is the sort of project that needs the Bill for it to proceed.
Let me repeat that the Bill is not a general invitation to increase expenditure. Financial assistance is subject, first, and as before, to the 2p rate product limit, secondly, to capital expenditure controls and, thirdly, to the constraints imposed by rate support grant. We have no intention of increasing capital expenditure allocations for that purpose or of increasing the aggregate amount of block grant available for local government.
The right hon. Member for Ardwick asked me for details of the schemes that had been approved, and the contributions from the private and public sectors. I shall write to him on those matters.
I am sure that right hon. and hon. Members will now appreciate the limited intention of the Bill and, at that same time, the importance of its receiving a speedy passage through the House. I am sure that all hon. Members will wish to safeguard the future of the UDG scheme, which has been so widely welcomed in the debate.
Question put and agreed to.
Bill accordingly read a Second time.
Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

Merchant Shipping Bill [Lords]
Not amended (in the Standing Committee), considered.
Motion made, and Question proposed, That the Bill be now read the Third time.
6.29 pm
The Under-Secretary of State for Trade (Mr. Iain Sproat): I undertook to say a few words on this matter.
When I introduced the Bill in Committee I said that its main purpose was to provide a simple procedure for the registration of pleasure craft. The registration of pleasure craft may appear to be a relatively minor problem, but, because of the increasing number of boat owners and the inadequacy of existing legislation, it requires an early solution. I believe that we have found that solution by setting up a small ships register for boats under 24m in length. The register will provide a quick, simple and, we trust, well-run service.
The hon. Member for Batley and Morley (Mr. Woolmer) raised a number of important points in Committee, and I believe that I gave him an assurance on each of them.
With those few words, I commend the Bill to the House.
6.30 pm
Mr. K. J. Woolmer: I am most grateful to the Minister for the assurances that he gave in Committee on the various points that I raised. I am glad that he acknowledged their importance.
It is a pity that the Bill does not deal with other matters connected with merchant shipping. My hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) will have an opportunity later this evening to raise the wider matters about which the industry is rightly concerned.
I acknowledge the importance of getting the Bill through quickly, and on behalf of the Opposition, in view of the assurances that I received, I am happy to see it pass.
6.31 pm
Mr. R. C. Mitchell: Clause 8 says:
"Her Majesty may by Order in Council direct that any of the provisions of this Act and regulations under it shall extend"
to certain other groups. To which of those groups—the Isle of Man, the Channel Islands, any colony, and so on—does the Minister propose to extend the regulations? In particular, has he any proposals to extend the provisions of the Act as it will become and the regulations to Hong Kong?
Mr. Sproat: Not at the moment.
Question put and agreed to.
Bill accordingly read the Third time and passed, without amendment.

International Transport Conventions Bill [Lords]
As amended (in the Standing Committee), considered.
Motion made, That the Bill be now read the Third time.
Queen's consent having been signified—
Question put and agreed to.
Bill accordingly read the Third time and passed, with an Amendment.

STATUTORY INSTRUMENTS, &c.

  RATING AND VALUATION
  Motion made, and Question put forthwith pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &c.)
  That the Mines and Quarries (Valuation) Order 1983, dated 8th March 1983, a copy of which was laid before this House on 15th March, be approved.—[Mr. Douglas Hogg.]
  Question agreed to.

  SOCIAL SECURITY
  Motion made, and Question put forthwith, pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &c.)
  That the draft Supplementary Benefit (Resources) Amendment Regulations 1983, which were laid before this House on 7th March, be approved.—[Mr. Douglas Hogg.]
  Question agreed to.

  LEGAL AID AND ADVICE
  Motion made, and Question put forthwith, pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &c.)
  That the Legal Aid (Scotland) (Financial Conditions) Regulations 1983, dated 11th March 1983, a copy of which was laid before this House on 14th March, be approved.
  That the Legal Aid (Financial Conditions) Regulations 1983, dated 10th March 1983, a copy of which was laid before this House on 10th March, be approved.
  That the Legal Advice and Assistance (Scotland) (Financial Conditions) Regulations 1983, dated 11th March 1983, a copy of which was laid before this House on 14th March, be approved.
  That the Legal Advice and Assistance (Financial Conditions) Regulations 1983, dated 10th March 1983, a copy of which was laid before this House on 10th March, be approved. —[Mr. Douglas Hogg.]
  Question agreed to.

  REPRESENTATION OF THE PEOPLE
  Motion made, and Question put forthwith, pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &c.)
  That the Representation of the People (Scotland) Regulations 1983, dated 8th March 1983, a copy of which was laid before this House on 10th March, be approved.—[Mr. Douglas Hogg.]
  Question agreed to.

Standing Orders (Revision)
6.34 pm
The Lord President of the Council and Leader of theHouse of Commons (Mr. John Biffen): I beg to move,
That the repeals of, and Amendments to, the Standing Orders of this House relating to Public Business, and the new Standing Orders, recommended by the Select Committee on Standing orders (Revision) in their Report and stated in the Appendix thereto, be made, subject to the following modification, namely, in Standing Order No. 65 (Procedure in standing committees), paragraph (3), line 11, after `committee' insert 'or to a motion relating to a document referred to a committee under paragrapy (4) of Standing Order No. 73B (Standing Committees on European Community documents)', and to the following omissions, namely, the recommended Amendment to Standing Order No. 24 (Order in debate), paragraph (2), at the end to add and no salary shall be payable to such Member in respect of such period of suspension', and the recommended Amendments to paragraph (5) of Standing Order No. 86A (Select Committees related to Government departments).
It is, I believe, of particular importance that the procedures of this House are contained in Standing Orders which are as clear, consistent, and up-to-date as possible.
It is for this purpose that from time to time a Select Committee of the House is established to tidy up our Standing Orders. This requires the renewal of out-dated references, ensuring that drafting and phraseology do not differ from one Standing Order to another; and providing that structure and order follow as logical a pattern as possible.
The last time this was done was by a Select Committee set up in 1970. The report with which the present motion is concerned is that of the Committee appointed in December last year. Its formal terms of reference were
"To consider and report upon the re-arrangement and redrafting of the Standing Orders so as to bring them into conformity with existing practice".
I should like to take this opportunity to thank my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas) and the members of his Committee for the thoughtful care that they have clearly taken in performing this task and the valuable contribution that they have thus made to our proceedings here. As the House will have noted, the Committee has made a considerable number—263 in all—of proposed drafting changes.
The overwhelming proportion of these changes, as detailed in the schedule to the report, are entirely of a minor drafting kind. Some renumbering and rearrangement is recommended. A considerable number of amendments are proposed to ensure consistency of phrasing: for example, using "at least" rather than "not less than"; and the standardising on the use of "Committee" as a singular. It is proposed that some outdated references should be removed. Finally, the embodiment in Standing Orders is proposed of a resolution of the House concerning the publication of evidence taken by a Select Committee in public, but not yet formally reported to the House. The combined procedural expertise of the hon. Members who served on this Committee is formidable indeed. I see no reason to question the Committee's assurances that their proposed amendments do not affect current procedural practice in any way. I warmly recommend their adoption to the House.
The Committee has, however, drawn to the attention of the House a small number of its recommendations that contain an element of substance as well as of drafting amendment. I refer to paragraphs 13 to 19 of the report. I wish,however, to draw to the attention of the House only
394
two of these recommendations. The rest seemed to me—as I hope they will to the House—essentially uncontroversial alterations.
The first—paragraph 14 of the report—proposes that Members suspended from the House for disorderly conduct should
"forfeit their salary during their suspension".
The Committee sees this as a clarification of the purpose of Standing Order No. 24, in that, in so far as this Standing Order sets out to punish art offending Member, it fails to impose what the Committee regards as the most obvious sanction which should accompany the exclusion of a Member from the precincts of the House.
There may be some argument as to how far such a proposal lies strictly within the terms of a revision of Standing Orders. However, in this connection, I take note of the Committee's comments on its procedural competence, detailed in paragraph 13 of the report. In any case, what I do know is that this would obviously he a most important change. It could, I suggest, also be sharply controversial not least because a suspended Member still has constituency responsibilities to discharge, whether or not he may be admitted to the Chamber. Thus, I do not feel that this procedural side wind would be appropriate for such an innovation. I am fortified in this view by the fact that the Committee itself divided on the recommendation which was included in the report only by a vote of three to two. I propose, therefore, that in the context of this report at least, this recommendation should be rejected. The motion now before the House would provide accordingly.
The other recommendation to which I would draw the attention of the House is that contained in paragraph 18 of the report. This concerns Standing Order No. 86A(5). At present, this sub-paragraph would enable a Sub-Committee on the nationalised industries to be formed from members of the relevant departmental Select Committees, but makes no provision as to which of the departmental Select Committees the sub-Commiitee should report to. It has hitherto been inoperative. The proposal made in the report is that the Committee should become a Sub-Committee of whichever departmental Select Committee its chairman is a member of.
I think, however, that it is for consideration whether this matter affecting Select Committee organisation would most appropriately be dealt with in this way. The recommendation is contrary to a recent recommendation by the Liaison Committee of Select Committee Chairmen,

395
to which I shall be replying shortly, and it is relevant to the consideration of the Parliamentary Control of Expenditure (Reform) Bill now before the House. I accordingly suggest that this proposal should be merely noted, but that no decision should be taken this evening.
The House will appreciate that I am in no sense prejudging whether a nationalised industries Sub-Committee should be formed along the lines suggested; I am merely observing the contrary views that have been expressed by the Liaison Committee and the relevance to the decision on the outcome of the Parliamentary Control of Expenditure (Reform) Bill which has yet to pass into law. I do not believe that this evening is the appropriate occasion for a decision.
The motion also provides for one other modification to the Committee's proposals. Recommendation 45 in the Committee's report proposes an amendment to Standing Order No. 65—page 19 of the report. It recommends that that order should cover not only notices of amendments to Bills, as it already does, but amendments to motions before Standing Committees on European Community documents. The recommendation speaks of motions which have been referred to such Standing Committees, but in fact it is not the motions which are referred but the documents themselves. The modification provided for in the motion will make it clear that the amendments referred to are amendments to motions relating to documents which have been referred. This amendment has been agreed with the Chairman of the Committee. That passage convinces me how wise it is not to have a written constitution. Subject, however, to the two exceptions to which I have referred, and this minor modification, I commend the remaining recommendations in this report to the House.
It only remains, therefore, for me to express again considerable gratitude on behalf of the House to my right hon. and learned Friend the Member for Hendon, South and his Committee for the painstaking and thorough way in which they have carried out this revision.
Mr. Deputy Speaker (Mr. Paul Dean): Mr. Speaker has selected the Amendment in the name of the hon. Member for Tiverton (Mr. Maxwell-Hyslop).
6.41 pm
Mr. Robin Maxwell-Hyslop: I beg to move as an amendment to the proposed motion, in line 8, leave out from 'namely' to 'the' in line 10.
The reason for the recommendation that appears at the top of part II of the Committee's report—which concerned amendments with an element of substance, which found favour with the majority of the Committee—is that, frankly, when, for defiance of the Chair, a Member is named, far from there being any effecive disadvantage to the Member concerned, there is considerable income from media interviews, the Member is spared from having to attend the House and vote, from having to attend any Select Committee or Standing Committee and from being in the precincts at all, save if the Member is a member of a private Bill Committee, in which case he has to carry out his duties.
I want to make it clear, because there may be confusion among some hon. Members, that that recommendation does not refer to occasions when a Member is ordered by the Chair to withdraw for disorderly conduct. It applies
396
only to proceedings under Standing Order No. 24. In those proceedings a Member is named by Mr. Speaker. It is not to be confused with Standing Order No. 23 when Mr. Speaker or the Chairman orders a Member or Members to withdraw if their conduct is grossly disorderly.
Therefore, it is only for the most serious offences committed in the presence of the House, for which a Member is named, to which that sanction applies. It is wise to remember that that is done not just on the initiative of the occupant of the Chair, although that is what starts the proceedings. The Question is put to the House. It is the House itself that decides whether the Member or Members should or should not be ordered to withdraw. It is therefore a decision by the House of Commons, not an arbitrary imposition by the occupant of the Chair.
I hazard a guess that 99 per cent. of the public would be astonished to hear that a Member who is named and suspended from the service of the House does not lose his salary for the period of his suspension. Even some members of the Lobby, to my knowledge, were astonished to find that that was so, as reason and a sense of justice, apart from the requirements of good order, suggest that if a Member is suspended from the service of the House, he should not receive a salary for his full service of the House during that period of suspension.
It is not proposed by the Select Committee charged with the duty of revising the Standing Orders that secretarial or other allowances should cease during that period because there are some functions that a suspended Member still performs. It is merely proposed that a Member's salary, which is paid for his full and proper service of the House, is suspended during the period of his compulsory suspension.
I need say no more than that. The amendment is necessary only because, exceptionally, the Government have not chosen to include that provision within their omnibus recommendation that the House should endorse the recommendations of the Select Committee.
6.47 pm
Mr. Charles R. Morris: I support the motion moved by the Leader of the House. I shall comment on the amendment moved by the hon. Member for Tiverton (Mr. Maxwell-Hyslop). In so doing, I join the Leader of the House in expressing the Opposition's appreciation for the work that was done by the right hon. and learned Member for Hendon, South (Mr. Thomas) and his colleagues in the revision of the Standing Orders. As we all recognise, Standing Orders create the framework for orderly debate.
No one wishes to encourage disorderly behaviour in debates in the House. One does not want to encourage the challenging of the Chair by any Member from either side of the House. However, I draw the House's attention to a point that was made by the hon. Member for Tiverton when he moved his amendment. He suggested that, as a form of sanction on and punishment of a Member who is named for disorderly conduct and then suspended from presence in the House, the Member should lose his salary for the period of his suspension. That sounds reasonable until one starts to work out what it means in salary terms. Assuming that the Member is suspended for five days, will 5/365 of his annual salary be withdrawn? Is the annual salary related to a daily salary? If a Member's salary is to

397
be withdrawn for disorderly conduct, will those who voluntarily suspend themselves from attendance at the House lose a daily salary?
Mr. Maxwell-Hyslop: No such proposition has been made by me. Such a Member is not prevented from coming here and voting, nor is he relieved of the obligation to attend Committees of the House on which he has been appointed to serve.
Mr. Morris: I accept the point made by the hon. Gentleman.
If it is argued that a Member who is suspended ought to lose a daily part of his annual salary, it is assumed that the salary is based on a daily entitlement. Is it or is it not? I support the motion moved by the Leader of the House. If we accept that the salary of a Member of the House is on a daily entitlement, we move into a difficult area. The amendment should be rejected at this stage and considered later in greater depth. As the Leader of the House said, the recommendation was carried in Committee by only three votes to two. It requires deeper and more thoughtful consideration.
Mr. Maxwell-Hyslop: As the right hon. Gentleman seems to attach great importance to this point. I should draw his attention to the fact that entitlement to pension for a Member is calculated on the basis of a 365-day year. That was the recommendation of one of the salary review bodies, and it was accepted by the House. Therefore, it is in no way anomalous or innovative that the daily salary should be calculated for this purpose by dividing the annual salary by 365 in exactly the same way as a Member's pension is calculated, with the approval of the House.
Mr. Morris: I accept the point that the hon. Gentleman is putting, but the pension entitlement is related to the principal Civil Service pension scheme. The scheme for Members is analogous to the Civil Service pension scheme. A Member's pension is calculated on a completely different basis from his salary. If it is argued that the salary is paid on the basis of a daily sum, it automatically provokes the question whether the daily portion of the salary is the entitlement for a day's attendance. If a Member is suspended for, say, five days and it is laid down that, because he or she has been suspended, he or she should lose five days' pay, can it not equally be argued that if a person attends on five days he is entitled to five days' salary?
Mr. Maxwell-Hyslop: I think the right hon. Gentleman's memory has let him down. The pension scheme was based on complete years, and Members were credited only with complete years. It had nothing to do with the Civil Service. On the recommendation of the salary review body, a change was made to take account of years served, plus days in an incomplete year, for which the year's entitlement was to divided by 365. No one is arguing in support of the amendment anything other than the bare proposition. Nobody is arguing that if a Member is ill or absent, he should lose any salary. That would be a different matter. If someone wanted to put forward such a recommendation he could do so, but that is not the recommendation made by the Select Committee charged with revising Standing Orders; neither is it the recommendation in the amendment, which is confined solely to the disciplinary case where a Member who has been in defiance of the Chair is named.
Mr. Morris: I am grateful to the hon. Gentleman for the point he has made. I assure him that my memory is not at fault. I served in the Civil Service Department, and my mind is scarred by that experience. I have not misinterpreted the position of the Members' pension scheme in regard to the principal Civil Service pension scheme. I say—and I am open to correction—that the Members' pension scheme is based on the principal Civil Service pension scheme. The salary that Members receive is not related to the Civil Service as such. That is a fact of life. If a day's pay is to be regarded as 1/365th of annual salary, a precedent will be established and it may be used in different ways.
The Leader of the House said that, despite suspension, a Member continues to carry the constituency commitments involved in his or her representative position as a Member of the House. That is another aspect of the withdrawal or suspension of salary which will have to be given serious consideration. The House should accept the argument advanced by the Leader of the House and reject the amendment, which should be taken back for deeper and more thoughtful consideration.
6.56 pm
Mr. Peter Thomas: As Chairman of the Select Committee whose report is before the House, I thank my right hon. Friend, the Lord President, and the right hon. Member for Manchester, Openshaw (Mr. Morris) for their kind remarks about the Committee and also for the welcome that they have both given to over 99 per cent. of the Committee's recommendations.
To serve on a Select Committee dealing with the revision of Standing Orders does not appear on the face of it to be a thrilling part of parliamentary activity. In the event, our deliberations were conducted in a lively and invigorating way. I am grateful to those Members who attended for their industry, enthusiasm and contributions. Perhaps I may single out the hon. Member for Islington, South and Finsbury (Mr. Cunningham), who was determined to see that all the wording we used in our amendments was both grammatical and stylistic. He was successful. What we have produced is the fruit of his efforts.
It is 12 years since the House accepted that there should be changes in Standing Orders. During those 12 years great change has taken place. It was opportune that a Committee should be set up to consider what amendments and changes were needed. We have proposed 263 changes. Apart from the small drafting amendment to our recommendation on Standing Order No. 65, which was referred to by my right hon. Friend and which I accept and welcome, 261 of our changes appear to be acceptable, as I understand from the speeches that we have just heard. That is not a bad track record for a Select Committee.
I do not propose to speak at length, nor do I intend to go into detail on the amendments. Any changes of a substantive nature that we have proposed—in particular, changes which to some extent may have been outside our terms of reference—have been put in a separate appendix. We did that for the convenience of the House, so that these matters could be brought clearly to its notice.
I wish to say something about the two amendments referred to by my right hon. Friend the Leader of the House, especially the one referred to by the right hon.

399
Member for Openshaw. In both cases the Committee sought to bring the drafting of the Standing Order into conformity with its intention.
I shall deal first with the amendment to paragraph (5) of Standing Order 86A relating to a Sub-Committee on nationalised industries being set up from time to time. The Standing Order, as drafted, proved unworkable, and the Liaison Committee recommended its repeal. The Select Committee also considered whether to make that recommendation, but we felt that it was the clear intention of the House that there should be such a Sub-Committee. Therefore, we have proposed improved drafting to allow the Sub-Committee to operate, if that were thought desirable.
I listened with care to my right hon. Friend's comments on this amendment. For the reasons that he gave, I accept that the proposal should be merely noted today, as it would not be an appropriate occasion for a decision to be taken.
Probably the main proposal in today's debate is the amendment to Standing Order No. 24 relating to suspension from the House for disorderly conduct in defiance of the Chair. With one exception, such suspension involves withdrawal from the precincts of the House. The amendment proposes that Members who are suspended should forfeit their salaries during the period of suspension.
I agree with my right hon. Friend that that would be an important and sharply controversial change. There was considerable division about it in the Select Committee and, as my right hon. Friend said, the recommendation was included in the report by three votes to two, two members of the Committee being absent.
Standing Order No. 24 dates back to an order passed in 1880—well before the payment of salaries to Members, which began in 1911. The intention of the Standing Order was clearly punitive, and the purpose behind the amendment was to implement fully that punitive intention. However, I agree with my right hon. Friend and with the right hon. Member for Openshaw that it is such a far-reaching, controversial and arguable amendment that it would be inappropriate for the House to accept it today. At a later date—perhaps in a review of the powers of the Chair—it might be considered again. Speaking personally, however, as of course I must, I accept my right hon. Friend's motion and commend it to the House.
7.3 pm
Mr. George Cunningham: I wish to speak briefly to three of the more controversial recommendations in the report. First, however, I express our gratitude here, as we have done elsewhere, to the right hon. and learned Member for Hendon, South (Mr. Thomas) who chaired the Select Committee and also to the Clerk of the House for the enormous assistance that he and the Clerk to the Select Committee gave us in the conduct of our proceedings.
On withdrawal of salary, the right hon. Member for Manchester, Openshaw (Mr. Morris) put forward technical objections to the imposition of sanctions of this kind on Members who had been suspended. My objection is one of substance. Unless there is widespread abuse I do not believe that it is proper for the House to exercise this or any other form of discipline over its Members. We should be extremely reluctant to allow other Members to
400
discipline a Member. A Member is answerable to his constituents, and whatever penalties need to be visited upon him should be visited upon him by his constituents. We should go beyond that only when there is such severe and widespread abuse of our procedures as to make our proceedings impossible or difficult. On that basis of substance, I believe that it would be wrong for us to impose the additional sanction of withdrawal of salary on a Member who has been suspended.
On the nationalised industries Committee, I am afraid that in my view not only is the present situation unsatisfactory but the recommendation in our report is also unsatisfactory. In 1978, when the big Procedure Committee recommended a new family of Select Committees, we recommended that there should continue to be the possibility of a nationalised industries Committee of some sort—I shall call it a Committee for the moment—to study those matters that were common to two or more nationalised industries. We envisaged that the membership of that Committee would be drawn from the subject Committees involved in the issue that the nationalised industries Committee was to study.
I was a Member of the Procedure Committee in 1978, but I do not recollect our ever addressing our minds to the problems arising from the fact that the nationalised industries Committee would be a Sub-Committee and not a full Committee. Had we been aware of the problem that that created, I am sure that we should have recommended that there should be a full nationalised industries Committee which, unlike the old nationalised industries Committee, would not be a Committee in its own right with separate membership and its own subject but a potential Committee to be called into existence from time to time as the need arose, with its membership drawn from the subject Committees. The advantage of that would be that such a full Committee could report direct to the House.
As the House will have gathered, I do not agree with the recommendation in our report, for this reason. We have given the proposed nationalised industries Sub-Committee an artificial daddy because the poor little thing had no daddy of its own. We did that to allow the Sub-Committee to report, through its artificial daddy, to the House. To find a means of defining the daddy, we decided to give the Sub-Committee to the member of the family of subject Committees to which the Chairman of the nationalised industries Sub-Committee happened to belong. That could involve serious problems, as the Sub-Committee might produce a report that did not have the support of the artificial daddy, although it might have the support of a number of the other subject Committees.
Therefore, I believe that there should be a potential nationalised industries Committee which can be called into being as needed but that it should be a full Committee made up from Members drawn from the other subject Committees but, like any full Committee, free to report to the House without its report having to be approved by any other Committee.
My third point of substance apparently causes concern to no one but me, and I regret that. The report recommends—and the Government recommend that we accept the recommendation—that when the House of Lords makes a proposal initiating expenditure it will automatically be ruled out when it comes to this House, and not be capable of being adopted by this House unless

401
it is covered by a money resolution from the Government. That is perceived as a means of retaining Commons power as against House of Lords power.
More important is the fact that it is also a means of retaining Government power against House power, because if the House of Lords initiates such a proposal for expenditure which gains the Government's support in the Commons with a money resolution, we overlook the fact that it has been initiated by the Lords. However, if it has been initiated in the Lords and five-sixths of the House wants it but the Government do not, there will not even be a possibility of a Division on it in this House. Therefore, we are not primarily removing a right of the House of Lords against this House but a right of non-ministerial Members of Parliament as compared with the Government. I am always opposed to that. It is a pity that we are doing it.
When my grandchildren ask me, "What did you do as a result of your X years in the House?", I may refer to one or two other things but I shall conclude by pulling a copy of Standing Orders off the shelf and saying, "Here is an old copy of Standing Orders which used to refer to `less' than 20 hon. Members when it ought to say 'fewer' than 20 hon. Members, and which used to say if a Committee `are' satisfied when they should have said if the Committee `is' satisfied.". Those two beautiful removals of irritation are worth several years of parliamentary life.
7.11 pm
Mr. David Crouch: I am grateful to my right hon. Friend the Leader of the House for bringing this important report to the House for debate so soon after its publication. We often wait a long time for Select Committee reports to be debated. All credit should go where credit is due.
I should also like to add my congratulations to my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas) on his speech today and for the report to which he and the members of the Committee have obviously given so much thought. Looking into Standing Orders is no small matter. It is a truism to say that they are the rules under which we operate our system of parliamentary democracy, through everything that we do in the House and its Committees.
I should like to comment on two recommendations that the Government have not accepted. I can understand why. I shall deal first with Standing Order No. 86(A) on the Sub-Committee on nationalised industries. It is a pity that the recommendation has not been accepted. I served on the old Select Committee on nationalised industries for eight years. For the three years during which we have had the new Select Committees, I have noticed the obvious omission of a separate Select Committee for nationalised industries. A Sub-Committee would be a step in the right direction towards filling the gap and satisfying the need for detailed study of the nationalised industries such as only a Select Committee can give.
The nationalised industries are now tending to wander rather lonely in the scheme of things without regular examination by Parliament through a Select Committee. I can understand my right hon. Friend's views on that subject, but I hope that he will note that there is a feeling in the House that the nationalised industries deserve and require more constant study by the House through its Select Committees.
402
The other recommendation with which I should like to deal concerns Standing Order No. 24. I listened to the hon. Member for Islington, South and Finsbury (Mr. Cunningham) and I note seriously his point that hon. Members should not try to punish an hon. Member. That step has been described as dramatic, should the House agree to it. Whenever we hear such comments, we shrink from taking such decisions. However, I am sorry that we have shrunk from that one as it is in accord with the proper responsibilities of the House regarding the behaviour of hon. Members and the authority of the Chair.
If we are afraid to take measures to support the authority of the Chair, we should re-examine ourselves. The Committee has examined the subject and has been worried that, at times, the authority of the Chair has been challenged. We can always challenge that authority in an official way by tabling a motion, seeking a debate or referring the matter to a Procedure Committee. There are many ways in which we can reform ourselves but we always maintain that the authority of the Chair is supreme in the Chamber.
Mr. Nigel Spearing: Is not the hon. Gentleman confusing two things? We all agree about the authority of the Chair, but is the hon. Gentleman suggesting that that authority is significantly diminished because there is no financial penalty? Surely the real sanction is not only being named but being excluded from the privilege of sitting in this place, even for one day. Is that not representative of the authority of the Chair? Indeed, might not—I put it no higher—the addition of a financial penalty demean and reduce that significant sanction?
Mr. Crouch: That is an extremely good point, but it takes nothing from my argument. I agree with everything that the hon. Gentleman has said. For an hon. Member to be named by the Chair and suspended from the Chamber and the precincts of the House is a significant punishment. However, I should have thought that suspension carrying the sanction of losing one's pay during suspension would accord with the spirit of the times.
We are trying to establish better discipline in industry and say that people who are suspended because they cannot observe the rules should also lose pay. Surely we should be prepared to accept that discipline as well.
It is recognised in the House—indeed, the House has decided in its Standing Orders—that the authority of the Chair is supreme. We may not challenge that authority, and if our behaviour is disorderly we are deemed to be out of order and can therefore be ordered out of the Chamber. I should have thought that it would be good for lion. Members to accept an additional punishment.
We are not so much debating whether hon. Members should decide to impose a punishment or a sanction on other hon. Members as showing that we are prepared to accept a sanction that might apply to us. I am not invoking a punishment on other hon. Members. We can all be disorderly, named and ordered out of the Chamber. It is sometimes almost proper, when debate is spirited, to determine that one will fall foul of the Chair. I have done so, and I doubt whether there is an hon. Member here tonight who has not ruffled the Chair a little—some more so than others.
Mr. Dennis Skinner: You speak for yourself.
Mr. Crouch: Some more so than others, Mr. Deputy Speaker.
Mr. Skinner: The hon. Gentleman can always beg for mercy.
Mr. Crouch: I am not begging for mercy, I am simply saying that this is a good recommendation. It is a pity that we shrink from it. I understand that we may have to delay the decision, but we should not delay it forever. We must face the fact that in recent years the House has been subject to much stronger criticism from outside for what appears to be disorderly conduct as a result of the broadcasting of Parliament. The public tend to hear those periods—15 minutes twice a week—that are noisier than the other eight hours of each day that we work. The feeling is growing up that the House is not the place of order that it should be. It has never been a very orderly place and has had to be controlled by the Chair for many hundreds of years. We respect the Chair for that reason. This small additional sanction would have shown that hon. Members collectively were prepared to take their punishment if they transgressed the rules of the House.
I hope that my right hon. Friend will take those thoughts on board and will understand that we do not dismiss the idea readily.
7.21 pm
Mr. Nigel Spearing: I shall not follow the remarks of the hon. Member for Canterbury (Mr. Crouch), for reasons that I shall make clear in a moment.
This debate is significant because Standing Orders generally work so well that we take them for granted. The Leader of the House mentioned a written or unwritten constitution, but Standing Orders are part of the effective constitution of Britain. They are the part that is, to some extent, written down, like the Representation of the People Act 1983 and other documents—unfortunately, including the treaty of Rome—which affect our constitution.
Standing Orders are the ball-bearings on which the parliamentary wheel works. The entire public life of Britain depends on that wheel turning, without its spokes being destroyed. If the ball-bearings are not in good order and are not lubricated, as the Committee has done for our benefit, or if they become rusty and inefficient, the effects are out of all proportion to the modest size of the book.
We owe some thanks to the Select Committee on Standing Orders (Revision), but I must add a small caveat about its proceedings. Its terms of reference were
"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."
The recommendation about pay and suspension was an innovatory suggestion, but—I choose my words carefully—I am surprised that consideration of any such proposition was strictly in order for that Committee. It is interesting to note that much of tonight's debate has been not on the many relatively minor changes to Standing Orders but on pay and suspension. It is not strictly appropriate for the Committee to have reported on it, so I shall not discuss it tonight. If the amendment is not carried, perhaps we should try to deal with the matter on another occasion. This is not the right time to debate the matter, still less to decide it.
As to the practical effects of the motion in the name of the Leader of the House, line 4 states that the amendments
404
shall "be made". Therefore, once the motion is carried, with or without the amendment, from tomorrow there will be no Standing Order No. 9. It will be goodbye to Standing Order No. 9; hello to Standing Order No. 10. I am not sure whether that would be wise. I know that there is no likelihood of points of order tomorrow, but there may be some when we meet again on Monday week.
Has the Leader of the House considered when the amendments should come into effect? A new term, if we can call it that, might be the right time. A new Session might be more appropriate, and a new Parliament might be even more convenient. There are other considerations. I understand that "Erskine May" is to be republished, and it may need textual amendments. However, it would be difficult for the House to take on board an entirely new set of Standing Orders. They could hardly be reprinted by Monday week. I do not know whether the Leader of the House has considered this, but the House may be able to agree that the coming into force of the new Standing Orders should be postponed.
The table of comparison at the end of the document was of less help than I had wished, because, although the new renumbering of Standing Orders is contained there, it does not refer to the existing Standing Orders. Perhaps if we have another revision in 10 years, we can ensure that that is done. It might even be possible, when the new Standing Orders are printed, to have in brackets the numbers of the old Standing Orders. I mention this because those in the Clerk's Department—we should be grateful for their assistance to the Select Committee and the Clerk of the House was a witness—carry many matters in their heads, especially the numbers of Standing Orders. If they must do that, what can hon. Members do?
I understand from the table that new Standing Order No. 10 will replace the well-known Standing Order No. 9, but in the table of amendments Standing Order No. 9 is referred to as recommended Standing Order No. 11. I may have misunderstood the matter, and I would have drawn it to the attention of the Table Office informally had I not just happened to notice it a few moments ago. However, it reinforces my point about when the new Standing Orders should become effective.
There is a belief outside the House that our procedures are archaic and long-winded, that we have Standing Orders to prevent things happening, and that they are innately conservative. That is not correct. Standing Orders are constantly being revised through Procedure (Finance) Select Committee recommendations and through textual revisions, such as those before us today. They are referred to rarely because they have been honed through time and are very practical. I put it to those who examine our procedures that Standing Orders provide the least inconvenient way of dealing properly with business, consistent with the rights and privileges of hon. Members and the constituents they serve.
7.28 pm
Mr. Bob Cryer: On page 32 of the report there has been an alteration in the wording in accordance with the terms of reference of the Committee. Recommendation No. 121 states:
"Any Member intending to propose that certain Members be members of a select committee, or be discharged from a select committee, shall give notice of the names of the Members whom he intends so to propose, shall endeavour to ascertain previously

405
whether each such Member will give his attendance on the committee, and shall endeavour to give notice to any Member whom he proposes to be discharged from the committee."
I understand that these are redrafting points, and under the terms of the Committee, it would have been difficult for it to have made it a requirement that any hon. Member intending to propose that an hon. Member "shall" obtain the consent from the hon. Member and "shall" give notice to the hon. Member concerned. Membership of Select Committees is drawn up by Whips of either side, who started from an illiberal beginning when they voted, and organised the vote to exclude an hon. Member. They have continued their illiberal practice ever since, with variations on the theme. There have been occasions when hon. Members have found their names on lists or have been taken off, when they have not been consulted. It would have been useful to alter the Standing Order to ensure that an hon. Member understands the position and is consulted.
However, the Committee was not empowered to do that because the terms of reference were limited to
"report upon the re-arrangement and re-drafting of the Standing Orders so as to bring them into conformity with existing practice."
That is all. It is a minor task, but we should thank the Committee for its endeavours, because it is a boring task as well. The fact that it has been undertaken is a credit to the Committee. However, having given it that limited and narrow task, we should not consider a major alteration by means of a side wind—that is, the recommendation that if hon. Members are named and therefore suspended, they should lose their pay.
When the hon. Member for Tiverton (Mr. Maxwell-Hyslop) proposed his amendment, he said that hon. Members were paid to turn up and do a job here. That is true, but it does not apply universally. I wish that it did. As I argued before, if that was the criterion that applied, payment would be withheld from a large number of people. However, that is not the criterion. I endorse what my hon. Friend the Member for Newham, South (Mr. Spearing) said, that it is a considerable punishment, indeed the greatest one that can be inflicted, to deny an hon. Member access to this place. We pass annual orders to ensure that they have access to this place, so that we can have an unfettered ability to get here. We do that, whether or not it is effective, to emphasise the importance of our attendance here. People work extremely hard to get to this place and argue lengthily and mightily at elections that they, and not others, should represent the people here. Therefore, once they have got here, to deny them access is a considerable punishment.
Mr. Crouch: I take the hon. Gentleman's point about denying hon. Members access, but he suggested earlier that some hon. Members were not here all the time. If we are to demonstrate outside that it is a punishment, and we are prepared to take it, hon. Members should be prepared not only to be denied access here, but to be denied payment for not being here.
Mr. Cryer: I am saying that punishment is enough.
It is not true to suppose that the level of noise in this place is in some way allied to the ability to throw people out. The noisiest times are not always the times when people are removed. There have been noisier occasions when individuals have not been punished because the House has been suspended. For example, there was on that well-known occasion when the Mace was, for some reason, removed from its resting place—I have some
406
reservations about the position of the Secretary of State for Defence because if he has another rush of blood to the head he now has buttons to press and it is much more harmless to remove the Mace. On that occasion, the House was suspended when there was clearly an individual action. I am not criticising the Speaker of the day for that, but it is not true that noise and the ability to throw an hon. Member out are related.
On another occasion, when my hon. Friend the Member for Edinburgh, Leith (Mr. Brown) was named, he spoke quietly and merely said that he was putting a little notice on the Table. It was a quiet and measured occasion, but it probably took everybody's breath away. The removal of pay is not necessary to make the offence that more heinous and neither will the chilling obligation of being both excluded and losing pay make the House behave that much more quietly.
We are a noisy assembly. It may be that through broadcasting people outside bring their influence to bear and some procedures change. Noise can be defended. Assemblies that are quiet and in which the speaker is listened to in respectful silence because it is the custom and practice of the assembly, may be nice assemblies, but they are inordinately dull. One of the strengths and virtues of this place is that hon. Members stand up and challenge other hon. Members on points. It is an interchange of ideas, and a clash of wills. That is a strength.
For example, when I have the opportunity to ask questions of the Prime Minister, which is not sufficiently often, there are occasionally some odd comments from Conservative Benches. I do not grumble at that, and I do not go on radio to say what a noisy place this is. I expect and understand the noise, and feel that one of the challenges of this place is to be able to stand up to it.
This happens to be by tradition a noisy place. It is. on many occasions, the stronger for it, although I do not include in that observation the scenes between 9 o'clock and 10 o'clock when on many occasions when we were in government—this tends to be forgotten—the words of the Minister's winding-up speech could not be heard. I am talking about the way that people can interject, ideas can be challenged and hon. Members who come to speak at either Dispatch Box have to be reasonably certain of what they are saying to confront the House with their ideas. That is not a bad thing either, because if one has a quiet and respectful assembly it is easier to get away with things than if that is not the case.
Noise is a characteristic of ours, and removing five days' pay will not change it. The barring of an hon. Member from the House is sufficient punishment. What is more, the loss of pay would be much more onerous to Members of Parliament who are full-time Members of Parliament—the very hon. Members to whom the hon. Member for Tiverton referred—than those who are not. The report refers to a clarification of the Select Committee on Members' Interests (Declaration).
We know that some hon. Members, although not all, have outside interests. If a Member with outside interests is suspended for five days with loss of pay, he will not feel it. Hon. Members will not be badly done by if they are not paid for a few days. I am not arguing that they will be, because we are well paid. However, some hon. Members are not only well paid as Members of Parliament but handsomely paid from outside jobs as well. I am opposed to that. Hon. Members should be full-time, and work at the job. I do not wish to go into the arguments about

407
whether outside work enriches the House, because the arguments about outside work are never made by engineering workers or road maintenance workers or coal miners but in defence of company directorships, which are supposed to enrich the House.
The removal of part of the parliamentary salary will have little effect, especially if the suspended Member has outside interests. The person who will be hit hardest will be the full-time member of Parliament, who will not be dealt with fairly. That is another reason why I do not support the removal of salary.
It has also been argued that, if a Member is thrown out, he will get a lot of money from the media and, therefore, it will not matter. That is not necessarily true. Indeed, it is unlikely to be the case. I have no experience of this, although I may have had one or two near misses, but I am quite sure that other hon. Members can testify from experience. I believe that, when a Member is thrown out, there is a brief acknowledgement from television, mostly as a matter of practical application from film crews immediately on the spot. In those circumstances, I do not think that a fee is received. Therefore, the notion that such a Member can derive substantial income, or any income at all, is not true.
The Committee is trying to do something by a side wind that was not within its terms of reference. The penalty of exclusion is sufficient. The removal of salary would apply unfairly among Members, some of whom are full-time and some of whom are part time with outside interests. In any event, such occasions are so rare That they do not merit this additional burden on Members. By and large—indeed, universally—hon. Members acknowledge the rules of debate that enable us to exchange ideas. There are sometimes challenges to the Chair, but that has not been so only since 1979. Between 1974 and 1979, there were many challenges to the Chair. That depends on the quick wittedness, wit and deafness of the Chair. At times it is an onerous and difficult task, but it will not be helped one jot by the removal of a Member's salary.
I am in the somewhat uneasy position of supporting the recommendation of the Leader of the House. In spite of that, I hope that the House too will support his recommendation.
7.43 pm
Mr. Dennis Skinner: I shall not detain the House for very long, but at the outset I should say that I am not exactly in tune with the views of my hon. Friend the Member for Keighley (Mr. Cryer). He said that he had never been thrown out, and it makes a difference when one has been thrown out. Certainly the experience can change one's attitude to the suggested removal of salary.
The hon. Member for Canterbury (Mr. Crouch) referred to disorderly conduct. There will certainly be none tonight. However, during the recess many hon. Members will be going abroad, possibly to the Caribbean or to the Cayman Islands. Many of them are probably now in the Smoking Room drinking the hours away. We are not allowed to say that they are drunk, but without a doubt some of them are half sober. It seems like disorderly conduct when they come wobbling into the Chamber at 10 o'clock when a vote is taking place. That is probably the occasion on which to label someone disorderly.
408
There are many ways in which one can describe disorderly conduct. Having listened to the radio and heard the animal-like noises between 3.15 and 3.30, the public are bound to reach the conclusion that this place is like a beer garden. The problem is that some of us who wait for a lull in the proceedings, when all the "Hear, hearing" has receded, sometimes fall foul of Mr. Speaker.
Frankly, I believe that my interventions make more sense than the animal-like noises, especially when the SDP has something to say. Indeed, it is novel for the SDP to develop policy on the Floor of the House of Commons, even if some of its Members pronounce Ravenscraig as "Wavenscwaig". I noticed that on that occasion Dr. Death was laughing his head off, and we know why. The right hon. Member for Roxburgh, Selkirk and Peebles (Mr. Steel)—the boy David—was also quite pleased.
I am concerned that the Select Committee report has come to the House with such speed. Normally, these reports, do not come to the House very quickly, and on some occasions they are debated years after they are published. Only last week I spoke in an Adjournment debate on the tragic case of Alan Grimshaw, who gave evidence to the Select Committee on nationalised industries in 1973–74. That report was never debated on the Floor of the House. Had it been, it would have been dynamite. I was, therefore, surprised when my hon. Friend the Member for Keighley reminded us of the speed at which this report had come to the House.
Some time ago I referred to the Secretary of State for Employment as the Secretary of State for Unemployment. One thing led to another, and I think I described him as a liar instead of using a phrase such as "terminological inexactitude"—[Interruption.] I am merely quoting what was said at the time.
Mr. Speaker: Order. The hon. Gentleman knows that he is quoting an unparliamentary expression. Perhaps, as a favour to me, he will leave his quotations alone over Eastertide.
Mr. Skinner: I could, Mr. Speaker, have used the phrase terminological inexactitude, but no people in Bolsover would have understood the significance of using that phrase. In any event, that is water under the bridge.
Having been ordered out of the Chamber, I should not have regarded it as a hardship had the money been stopped, because I thought that that would happen. My hon. Friend the Member for Keighley must disabuse himself of the idea that if he gets ordered out of the Chamber he will get on to the box, certainly within the confines of this place. He may get to Wells street or somewhere else, but the police are quick to act on the instructions of the Serjeant at Arms. I believe that my right hon. Friend the Member for Wakefield (Mr. Harrison) also plays a prominent part in these "throwing out" jobs.
When the television people wanted to escort me to their studio in the Norman Shaw building so that I could explain to the wide world—and to Bolsover in particular—what had happened, I was not allowed to go with them. I finished up on the lawn outside. My hon. Friend the Member for Keighley is absolutely right. When a Member does a television interview on the lawn, with Big Ben in the background, it does not come under the Equity rules and he will not get paid.
I do not want to give the impression that it can be regarded as a punishment to lose a day's pay when a

409
Member of Parliament's salary is about £14,000 a year. I hope that when my hon. Friend the Member for Keighley votes tonight, if there is a Division, he will not support the Leader of the House on the basis that he is trying to save some money for impoverished men.
Before I came to this place I was working at the pit. I was earning less than £18 a week. In those days I knew what it was like to lose a day's pay for being late for work, for example. That was a hardship. The loss of a day's pay made a real difference to the weekly pay packet.
Mr. Walter Harrison: I can remember quarters being stopped.
Mr. Skinner: The memories are flooding back to my right hon. Friend, who has been in this place for a long time. If there is a vote tonight, my hon. Friend the Member for Keighley and I will be in different Lobbies. That does not happen very often. I have no doubt that it will be extremely confusing to at least one hon. Member, who shall remain nameless.
We should not feel sorry for those in this place who lose a day's pay. Instead, our sorrow should go all the time to those whose wages are being docked by the Government. We should be fighting, for example, for the nurses, who have had a real cut in wages. So many have been hammered by the Government's policies. The 4 million who have been thrown out of work have lost all their wages.
Mr. Speaker: Order. We have strayed a long way from the motion.
Mr. Skinner: I was trying to win some sympathy from you, Mr. Speaker, because of the hundreds of thousands who are out of work in Wales. Let us think of them and not worry too much about the tiny problem which will not bear very hard upon us. If there is a Division, I shall vote with the hon. Member for Tiverton (Mr. Maxwell-Hyslop).
7.53 pm
Mr. Ray Powell: I am one of the "unfortunates" who have been named and asked to leave the Chamber. That happened to me earlier in the year. I went to the Library to ascertain whether suspension of Members over the past 10 years warranted serious consideration by the Select Committee. I was surprised to find that suspensions are rare. That was the position until 1981, when six hon. Members were suspended in the one year. In 1982, if the information that I received from the Library is correct, there were only three suspensions. In the few months that have passed this year, there have been two suspensions. On the most recent occasion, my hon. Friend the Member for West Stirlingshire (Mr. Canavan) was suspended. On the previous occasion, I was suspended. My suspension occurred late at night a few days earlier.
I have read the reasons why other hon. Members have been suspended and I have read why Mr. Speaker had to adjourn a debate on one occasion. That happened on the occasion to which my hon. Friend the Member of Keighley (Mr. Cryer) referred. I have contrasted the events of 27 May 1976—I read the report that appeared in Hansard and discussed the matter with those who were serving in the House at the time—with my suspension on 16 February. What would have happened to a Labour Member if he had pretended to be a drum major with the Mace? I am sure
410
that he would not have received the same treatment as the right hon. Member for Henley (Mr. Heseltine), who is now the Secretary of State for Defence. He played drum major with the Mace and caused the sitting to be suspended.
I have read the report in the Official Report—
Mr. Speaker: Order. The hon. Gentleman must not impute that I would not treat both sides of the House equally. He has given an inadequate picture of what took place on the night of 27 May 1976. He was not a Member at the time. If he had been here, he would know that other things happened that night which were not referred to in Hansard but which I saw.
Mr. Powell: I am not making that imputation, Mr. Speaker. I can go only by what I read in Hansard. There is a reference in Hansard to grave disorder having arisen in the House. That is the record that appears in Hansard.
On the following day the right hon. Member for Henley made a personal statement. He said:
"Last night, Mr. Speaker, I removed the Mace from its position. I deeply regret my action. I was hoping to be able to apologise to you and the House when you returned to the Chair last night. That was not possible, and I now take this first opportunity of apologising unreservedly."—[Official Report, 28 May 1976; Vol. 912, c. 769.]
That is what the right hon. Gentleman said when the House sat the following day.
I was suspended on 16 February when I was trying to raise a point of order during a debate. I was trying to make a point of order on important parliamentary constituency boundaries in Wales. It was possible to table amendments in the Table Office, but the order that was before us was not amendable. Therefore, my amendment could not be called. That was a reasonable ground for raising a point of order. On that night it was the only point of order that I felt was reasonable. I was persistent in asking Mr. Deputy Speaker whether he would accept the amendment, and unfortunately I was suspended.
I share the view that has been expressed by my hon. Friend the Member for Bolsover (Mr. Skinner). Most of us could reasonably afford the loss of a day's pay on suspension. My hon. Friend made the relevant observation that not all hon. Members attend the House regularly. Perhaps it would be wise to have a clocking on and clocking off system with Members of Parliament on both sides of the House being paid for their attendance. The attendance of some hon. Members would perhaps be very different if that system were rigidly operated.
I take exception to the suggestion that Members should be suspended if, in the course of representing their constituents, they try to get your attention, Mr. Speaker, by raising points of order and hoping that you will call them. Surely Members should be afforded the right of appeal if they are suspended because they have persisted in attempting to raise points of order. I submit that right should be given to them if they are to be suspended for the duration of the sitting. I suggest that some independent body should decide whether a Member is to be suspended in accordance with our Standing Orders. Some hon. Members might be reluctant to persist in properly representing their constituents if it means that they can be suspended without pay, because they might have family and other commitments, such as a mortgage, and have no other interests to supplement their salaries.
Mr. Cryer: Does my hon. Friend agree that the suspension of pay would affect Labour Members more

411
than Conservative Members because Labour Members depend solely on their parliamentary income? That rule would bear unfairly on one section of the membership of the House, because those with outside interests would be in an advantageous position.
Mr. Powell: I agree with my hon. Friend. One has only to look at the new booklet on the declaration of interests to see the many outside interests of Conservative Members compared with Labour Members. Therefore, it is important that Labour Members should seriously consider the Select Committee's suggestion.
Because few hon. Members have been suspended, I sincerely believe that there should be no suggestion that their pay should be suspended. It is enough that they are suspended and have to leave the Chamber so that they cannot represent their constituents. I was fortunate in that I was unable to represent my constituents for only one hour and five minutes—
Mr. Speaker: Order. The hon. Gentleman was not suspended; he was ordered out of the Chamber for misconduct. He is following a wrong tack to suggest that the Chair did not behave correctly. It is not open to him to attack the Chair tonight. If he wishes to do that, he must table a motion on the Order Paper.
Mr. Powell: Nevertheless, I had to leave the House. Therefore, I could not represent my constituents for one hour and five minutes; nor could I participate in the vote that took place on that occasion.
I wonder how much of my salary I would have lost if I had been suspended for one hour and five minutes. Had I been suspended on that occasion—the decision was not yours, Mr. Speaker; if was the decision of Mr. Deputy Speaker— I should not have been able to attend the following day's proceedings of the Welsh Affairs Select Committee, and it was imperative that I should. Having been present in the debate on Welsh boundaries and having read the Official Report of the proceedings carefully, I believe that there was no necessity for me to be suspended.
Mr. Speaker: Order. The hon. Gentleman is grossly out of order in saying that and criticising the occupant of the Chair. I am sorry that he did so.
8.4 pm
Mr. Gary WallerI have been inspired to make a short contribution, perhaps the shortest of the debate, by the speech of the hon. Member for Bolsover (Mr. Skinner), which has shown me how wise my right hon. Friend the Leader of the House is to recommend to the House that the recommendation of the Select Committee on the deduction of Members' pay should not be implemented.
One reason why it is so rare for a Member to be suspended from the service of the House is that it is not seen by the public to be a great sacrifice. If it were, as it might be if it involved deduction of pay, I suspect that many hon. Members would be queueing up, particularly as election time grew nearer, to make that sacrifice. It would enable them to show how strongly they felt about their constituents' interests, for which they were prepared to lose a day's pay.
That may not have been in my right hon. Friend's mind, but I suspect that if the proposal were to be implemented,
412
we might find that the need for Members to be suspended would grow considerably. Therefore, I am delighted that my right hon. Friend has made the decision not to do so tonight.
8.5 pm
Mr. Biffen: This has been an interesting and wide-ranging debate which one might not have supposed would have come from so closely argued a series of textual criticisms as is contained in the Select Committee's report. The House has much enjoyed having the topic somewhat widened. I appreciated the remarks of the hon. Member for Ogmore (Mr. Powell) who suggested that hon. Members might sign on for their emoluments because that is the practice of the other place. When we see the more self-confessedly radical Members of the Labour party looking to the House of Lords for some inspiration for our practices, I know that there is still a good future for consensus politics in the United Kingdom.
In substance, the debate has turned around two points—first, the consideration of a nationalised industries Committee and, secondly, Standing Order No. 24. On the former, I appreciate the general sense that has been argued in the House this evening and the support that has been given to the view that no definitive judgment should be reached tonight. In particular in that context, I welcome the support of and confirmation from my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas).
It is the contentious issue of Standing Order No. 24 and the possibility of withholding the pay of those hon. Members who are suspended that has seized most of our imaginations. It says much for the strong sense of puritanism that is within the heart of every hon. Member that many, not least the hon. Member for Ogmore, were anxious to have that provision apply to the circumstances in which they had been required to withdraw from the House, although the reform is intended only for grand and not lesser offenders. Whether the hon. Gentleman aspires to that more dramatic gesture, I know not, but, if it lies within my ability, I would like to discourage him.
The debate has highlighted the problem which properly concerns hon. Members because we are the guardians and keepers of the reputation of the House, and orderly and disorderly conduct bear upon that. But let there be no misunderstanding. The original Standing Orders date back to the last century, when behaviour in the House was infinitely more disorderly than it is today. There have been seven suspensions in this Parliament—just under two a year. I do not speak with any complacency or plead that in extenuation, but I suspect that, in an assembly where debate and conduct have inevitably tended to be a good deal more lively than in some other assemblies, we strike a balance among the various components of debate, including that of noise and disorder, which are historically integral to the conduct of our affairs. I suspect that we do that as well today as we have done at any time in generations past. I will not argue with my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) because he will sense that he had more robust criticism of his speech from others than from me. In response to the point made by the hon. Member for Newham, South (Mr. Spearing), should the new Standing Orders be confirmed this evening, they will become effective as soon as the resolution is agreed to. I make a reference of gratitude to the hon. Member for Islington, South and Finsbury (Mr.

413
Cunningham). I doubt whether the revised Standing Orders in their pristine and pure exposition of language will stand alongside Milton or Shakespeare but to have done something to improve the language in the essential bureaucracy of this place is, indeed, an achievement. I congratulate him on that point.
8.11 pm
Mr. Maxwell-Hyslop: I was interested, though by no means surprised, that the hon. Member for Bolsover (Mr. Skinner) confirmed the widely-held view that he expected that his salary would cease to be paid during his suspension from the service of the House. That is the universal expectation outside the House. That is also the widely-held, if incorrect, belief among those in the Lobby who comment on the affairs of the House, who are often surprised, if not astonished, to find that that is not the position.
The case, if I might dignify it with that word, put by the right hon. Member for Manchester, Openshaw (Mr. Morris) from the Opposition Front Bench is that he has some difficulty in dividing his annual salary by 365 to establish what five days' suspension means in terms of salary. That is such a trivial objection that he had to scrape the bottom of the barrel to find any argument against my proposition. I doubt whether his argument carries weight.
The argument for this reform did not arise when Standing Order No. 24 was first passed, simply because there was no salary that could be suspended. The opportunity was missed, just as many opportunities have been missed in subsequent revisions of Standing Orders. This seems an appropriate time to remedy what many hon. Members regard as an anomaly, in that the same salary is paid to hon. Members even when they have been suspended from the service of the House for defiance of the Chair.
I am pleased that it has been emphasised yet again that this proposition does not apply when an hon. Member is ordered to withdraw. It applies only to gross defiance of the Chair, which occurs when an hon. Member is named rather than ordered to withdraw. That is the only circumstance covered by Standing Order No. 24.
The withdrawal of salary would apply in many circumstances in life exterior to this House, such as in industry—
Mr. Charles R. Morris: Before the hon. Gentleman concludes his argument, may I ask whether he is suggesting that the salary for membership of the House is related solely to attending debates in the House?
Mr. Maxwell-Hyslop: Far from my not having suggested that, if the right hon. Gentleman had been present when I proposed the amendment he would have heard me say the contrary. I said that an hon. Member, although not allowed in the precincts of the House, except to serve on a private Bill Committee, could still deal with his constituency correspondence. I expressly said that for that reason his secretarial allowance would not be affected. The right hon. Gentleman would have heard me say that if he had been in his place at the beginning of this debate, or perhaps his memory has let him down.
It is from the service of the House—in the House, the precincts, the Chamber, the Select Committees and the Standing Committees—that an hon. Member is suspended when, having been named by the Chair, the motion is put
414
and carried. If it is not carried by the House, the hon. Member is not suspended. I emphasise that an hon. Member is not suspended from the service of the House initially for five days by the Chair. He or she is suspended from the service of the House by his or her fellow Members voting on the motion.
It is appropriate that in those circumstances no salary should be paid for the duration of the suspension. That view would be widely, if not universally, held outside the House. I believe that this is the proper occasion to remedy the anomaly of the absence of that provision. Therefore, I intend to press the amendment to a Division if it is opposed.
Question put, That the amendment be made;—
The House divided: Ayes 2, Noes 88.

Division No. 109]

[8.17 pm

AYES

Skinner, Dennis

Tellers for the Ayes:

Snape, Peter

Mr. Robin Maxwell-Hyslop and

Mr. Tony Speller.

NOES

Alexander, Richard

Knox, David

Ancram, Michael

Lang, Ian

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

Lloyd, Ian (Havant & W'loo)

Barnett, Rt Hon Joel (H'wd)

Lloyd, Peter (Fareham)

Beaumont-Dark, Anthony

McGuire, Michael (Ince)

Berry, Hon Anthony

Major, John

Biffen, Rt Hon John

Marlow, Antony

Biggs-Davison, Sir John

Mather, Carol

Body, Richard

Maynard, Miss Joan

Booth, Rt Hon Albert

Morris, Rt Hon C. (O'shaw)

Boscawen, Hon Robert

Morris, M. (N'hampton S)

Braine, Sir Bernard

Morrison, Hon C. (Devizes)

Bright, Graham

Murphy, Christopher

Brooke, Hon Peter

Myles, David

Buck, Antony

Neale, Gerrard

Carlisle, Kenneth (Lincoln)

Neubert, Michael

Chapman, Sydney

Newton, Tony

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

Osborn, John

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

Page, John (Harrow, West)

Cope, John

Page, Richard (SW Herts)

Cryer, Bob

Palmer, Arthur

Cunliffe, Lawrence

Parry, Robert

Cunningham, G. (Islington S)

Powell, Raymond (Ogmore)

Dixon, Donald

Prescott, John

Dubs, Alfred

Price, C, (Lewisham W)

du Cann, Rt Hon Edward

Proctor, K. Harvey

Durant, Tony

Race, Reg

Eggar, Tim

Rees, Rt Hon M (Leeds S)

Farr, John

Rifkind, Malcolm

Fenner, Mrs Peggy

Robinson, G. (Coventry NW)

Fitt, Gerard

Silvester, Fred

Fletcher-Cooke, Sir Charles

Spearing, Nigel

Foster, Derek

Sproat, Iain

Goodlad, Alastair

Squire, Robin

Hamilton, Hon A.

Thomas, Rt Hon Peter

Harrison, Rt Hon Walter

Thompson, Donald

Hawkins, Sir Paul

Townsend, Cyril D, (B'heath)

Hayhoe, Barney

Walker-Smith, Rt Hon Sir D.

Haynes, Frank

Waller, Gary

Hicks, Robert

Watson, John

Hogg, Hon Douglas (Gr'th'm)

Wells, Bowen

Home Robertson, John

Winterton, Nicholas

Johnston, Russell (Inverness)

Jopling, Rt Hon Michael

Tellers for the Noes:

Kerr, Russell

Mr. David Hunt and

Kershaw, Sir Anthony

Mr. Tristan Garel-Jones.

Question accordingly negatived.
Main Question put and agreed to.
Ordered,
That the repeals of, and Amendments to, the Standing Orders of this House relating to Public Business, and the new Standing Orders, recommended by the Select Committee on Standing

415
Orders (Revision) in their Report and stated in the Appendix thereto, be made, subject to the following modification, namely, in Standing Order No. 65 (Procedure in standing committees), paragraph (3), line 11, after 'committee' insert 'or to a motion relating to a document referred to a committee under paragraph (4) of Standing Order No. 73B (Standing Committees on European Community documents)', and to the following omissions, namely, the recommended Amendment to Standing Order No. 24 (Order in debate), paragraph (2), at the end to add `and no salary shall be payable to such Member in respect of such period of suspension', and the recommended Amendments to paragraph (5) of Standing Order No. 86A (Select Committees related to Government departments).

PETITION

  British Citizens (Right to Vote)
  8.26 pm
  Mr. Russell Johnston: I wish to present to the House a petition that I have received which is signed by 521 British citizens presently resident in the Grand Duchy of Luxembourg. The petition is brief and self-explanatory, and with your permission, Mr. Speaker, I shall read the substantive part of it. It
  Showeth that at least 300,000 British citizens resident in the other member states of the European Community were unable to vote in the 1979 elections to the European Parliament owing to the refusal of the British Government and Parliament to grant them the right to vote, and that this right has to this day not been granted.
  Wherefore your Petitioners pray that legislation be introduced to enable British citizens resident in other member states of the European Community to vote in the United Kingdom in the 1984 elections to the European Parliament.
  And your petitioners, as in duty bound, will ever pray, etc.
  To lie upon the Table.

Merchant Shipping
Motion made, and Question proposed, That this House do now adjourn.—[Archie Hamilton.]
8.27 pm
Mr. John Prescott: The House has had few occasions to debate the important merchant shipping industry, which is now, on any definition, in crisis. There was a debate in July 1981, when my hon. Friend the Member for Hackney, Central (Mr. Davis) raised the subject of flags of convenience and the threat to the world shipping trade, and British shipping in particular. We had an Adjournment debate on 25 November 1982 when the right hon. Member for Taunton (Mr. du Cann) spoke about the Merchant Navy fleet and its strategic value after the Falklands conflict. I understand that no Government time has been provided for a debate on the Merchant Navy.
The Government may argue that the Minister has been involved in discussions with the owners and trade unions on all aspects of the industry to formulate his view about the crisis facing merchant shipping. On 18 March, the Minister gave what I believe to be the Government's considered view in rejecting the views put forward in joint consultations by the industry and the trade unions. One can assume, following that reply of 18 March, that the Government now have a considered view of what they believe is the best policy to deal with the catastrophic decline of the Merchant Navy.
The Minister having now formed his view, will he ensure that the Government provide time to debate this important industry? I am fortunate tonight to have more time for my Adjournment debate than is normally expected. Had other Members known that more time would be available, they would have come to debate the issue this evening, but they may have been put off by the thought that only half an hour was available for the debate.
There is a need for a full-scale debate on the Merchant Navy, first, because a crisis faces the industry—a crisis of which everyone is aware—and, secondly, because there is a clear division between the views of the Government and of the industry. There is a difference of view between the Government's policy towards the British merchant fleet and that of the Opposition. Since 18 March, there has been a difference between the Government's professed view and that of the industry, in which I include both the unions and the employers. The combined view of the industry and the Opposition is that if the Government continue with the same policies, we can expect only a further collapse and decline in this important strategic industry. Indeed, the industry has already expressed the view that if the policies continue, the present 900 ships—there were 1,200 ships when the Government came to office—will decline to 600 by 1985. Over the past four years the number of ships has declined by about two a week. If the present policies continue, by 1985 the number of ships will have declined by about six a week. The sale of the famous Ellerman Line this week emphasises the continuing decline not only of individual ships but of shipping companies with long traditions.
The catastrophic decline is well catalogued. I shall quote the figures given by the Under-Secretary of State for Trade in reply to an Adjournment debate on 25 November 1982. In 1966, the British fleet stood at 27 million deadweight tonnes; in 1975, it was 52 million deadweight
418
tonnes; and in 1982 it was 32 million deadweight tonnes. That represents almost a 50 per cent. decline in the tonnage of the fleet since 1975. It is not difficult to understand the reasons for the decline. Adjournment debates have recorded the views of the Government and of Members on both sides of the House.
It is agreed that a depression in world trade clearly affects world shipping, but the interesting fact to note, as the Minister will acknowledge, is that since 1970 the world's fleet has grown, and has continued to grow, and world trade has continued to increase. However, along came the slump, which brought with it over-capacity.
As the Minister told the House, freight rates have collapsed by 50 per cent. since 1981. The Minister, of course, referred to bulk trade rates, not necessarily to the conference line rates for liner cargoes. The decline in liner freight rates has occurred less primarily because shipowners, despite all their rhetoric about free trade, maintain a conference system to guarantee a higher price to the shipper to maintain continuity of service. They actively intervene to protect themselves against the full effects of market forces and competition.
If fleet growth has occurred as a result of the free market philosophy, as the Minister would have us believe, and that is the sole principle which determines whether fleets decline or increase, the major factor, so often quoted by the Minister, is that it depends on the costs of the fleets. He appears to think that that means crew costs.
Let us examine the growth of fleets from 1970 to 1980. Liberia has doubled its fleet and is now the largest ship-owning country. Panama has increased its fleet by 10 times, and Greece by five times. Those countries all share the obvious feature of flags of convenience. In Europe, France, Italy, Japan and Denmark have increased their fleets, but, peculiarly enough, they all have a higher cost structure and, in some cases, higher manning levels than the British fleet. Therefore, it cannot be said that crude costs and manning levels have led to the decline of the British fleet. European countries whose fleets have declined include the United Kingdom, West Germany and Norway.
There has been a growth in the Soviet fleet. Although it amounts to no more than 5 per cent. of the world's fleets, that fact invokes great anger from the Minister. He does not feel the same anger about the flag of convenience fleets that amount to 30 per cent. of the world's fleets. But, of course, the Russians are in a class of their own. Their fleet doubled between 1970 and 1980. I shall refer later to the difference in the Government's attitude to what they see as the Russian threat and the flags of convenience fleets.
We must reject the view that the decline has come about because of high crew costs and manning levels. The British merchant fleet has gone through considerable change. There has been technological change with the development of bulk traders, tankers and containers. There has been a decline in the cargo liner ships, the tramp ships and other traditional ships of the 1960s and 1970s. Bulk traders are now the predominant influence in the voice of the shipowner. They have always been divided between their different interests, and that has been reflected in the nature of their demands upon the Government. Current demands from industry are largely influenced by bulk traders, yet conference line controls do not apply to that area where the free force of the market has its greatest effect. That is why the Minister so often mouths high crew costs as the predominant factor in the fleet's decline.

419
Manpower changes have occurred because of the technological changes and the decline in world trade. I first went to sea in 1965, when there were 150,000 seamen and officers. That number fell to 70,000 in 1975, and it is 50,000 today. There are 4,000 seamen on the dole, waiting for jobs.
The employment of British seafarers does not relate only to ships with the British flag. Because British registered vessels are registered under the British flag, it does not mean that they are British-owned and crewed by British residents. The ownership of ships under the British flag by foreign companies has increased from 21 per cent. in 1970 to 53 per cent. in 1980.
Lord Rochdale examined the industry in 1970 and said that we may have to intervene if foreign ownerships began to increase. His worst fears have been realised. It is unfortunate that we have a Government who profess to be non-interventionist and firm believers in market forces.
With this decline we have been unable to guarantee enough ship orders for our shipyards or to provide sufficient jobs for British seafarers. There has been a collapse of investment, with catastrophic effects on the shipyards. Investment by owners is now 65 per cent. of the 1975 level. It is probably the lowest home shipbuilding orders of any national fleet. The earnings of the British merchant navy fleet have fallen to such an extent that we now pay more for the services from shipping than we earn from them. Less than 50 per cent. of the trade in the United Kingdom is in British ships.
I think we all agree that there has been a catastrophic decline. I take the point that the Minister has made in previous debates that there was a massive increase in the fleet in 1975 and that therefore one should take an earlier date to get the matter into proper perspective. I do not accept that, because even the total figures show a decreasing share of the world tonnage by the British merchant service. The effect of that decline, both in world percentage and total tonnage, has not been dictated simply by free market forces.
If we ask people in the industry why we have reached this stage, even taking into account the depression in world trade, what they say is radically different from what the Government say. The industry says that trade is determined not simply by free trade; other matters affect trade. Therefore, it seeks financial support, such as cash investment allowances. For many decades shipowners have said that they believed in free enterprise, but in reality they have always received considerable subsidies. It is interesting to note that in a reply from the Minster, referring to subsidies, he mentions no "new" subsidies. However, a considerable amount of money is poured into the British merchant fleet.
An interesting study carried out by the UNCTAD conference on flags of convenience compared the financial incentives of registering in a flag of convenience country with those of registering in developed countries. The financial incentives in the subsidies given in developed countries and those that could be acquire through the tax haven approach in flags of convenience countries were not so different. The real advantage of flags of convenience lay in manning and certification, being able to change from one company to another, not having to comply with company regulations—something that the Minister has mentioned in past debates—and the requirements to
420
observe proper and adequate safety standards. That is what one acquires with flags of convenience. They are not necessarily financial incentives, although clearly there must be a positive financial incentive.
I note that the owners want some form of intervention, but they want it to be qualified. They asked the Minister—a willing servant in this respect—to intervene with the Russian fleets. It is said, for example, that Russia has 90 per cent. and Britain only 10 per cent. of the trade between the two countries. The same argument about a proper share applies to trade between Britain and Poland in the Baltic. Indeed, a shipowner was pleased to tell a number of Labour Members recently that there is now a 50–50 share in the trade between Poland and Britain. For the past 10 years we have been saying that it is the role of the Government to ensure that share. We in the Labour party call that planned trade. That is our policy. Yet that shipowner welcomed it, only a few weeks ago, as something new. The Government reject an interventionist role of that nature. It is a role that they do not want to play.
The Government made it clear in their reply to a parliamentary question on 18 March that they reject the two different approaches by the two sides of industry as to how to deal with the problem. The National Union of Seamen, in its excellent document "Heading for the Rocks", which I know the Minister has received, along with papers from the discussion groups that he set up, refers to a highly interventionist and protectionist role, with planned trade and public ownership. The Government's response was clearly spelt out in their answer in Hansard on 18 March. They said:
"The Government have no intention whatsoever of setting up in any form a nationalised shipping line; nor of paying operating subsidies to maintain the fleet at a given uncommercial size. Furthermore, they have no intention whatsoever of bringing in controls to require United Kingdom shippers, whether nationalised industry or private sector shippers, or foreign shippers, to use any percentage whatever of United Kingdom shipping contrary to their commercial judgment.
Furthermore, this Government have no intention whatsoever of setting up a cabotage regime for United Kingdom ports."—[Official Report, 18 March 1983; Vol. 39, c. 290.]
That is interesting when one bears in mind that in a debate the Minister said:
"The present Soviet practices are not proper commercial practices and they pose a threat to fleets such as our own, whose operations are properly commercial … Soviet wages tend to be about one third of comparable Western rates."—[Official Report, 25 November 1982, Vol. 32, c. 1112.]
The Minister said that he intended to open negotiations in February with the Soviet Union to renegotiate trade and change the imbalance of United Kingdom-Soviet Union shipping operations which was 90 per cent.–10 per cent. in the Soviet Union's favour. I do not know whether the Minister will tell us whether he has achieved that. I should like to let him into a secret. It is called intervention. It is called planned trade. One intervenes because of lower wages which, according to the Minister, are unfair. They may happen to be a little higher than flags of convenience wages in some cases, but in those cases the Minister recognises it as a free competitive market. How does he live with that difference? Is it simply because one is a Russian flag and another is apparently a more friendly flag of convenience country?
The Government were not prepared to increase Asian wages despite an agreement between the industry and the Labour Government to increase the terrible wages paid to Asians on British ships, where there is racial

421
discrimination in the amount of money that is paid to white and brown people. The Minister refuses to do anything about it. That is a little hypocritical, when he talks about the level of wages affecting the decline of our fleet.
Mr. Clinton Davis: Does my hon. Friend agree that although we initially encountered some opposition from India, Pakistan and Bangladesh to the proposals to which my hon. Friend referred, it was clearly the Labour Government's view that if those Governments wished to protect their economic position and had it within their power to operate a clawback system in regard to taxation, that was the right policy to pursue, and the Government should have insisted upon it?
Mr. Prescott: I fully agree with my hon. Friend. I congratulate him on the work that he did when he was a Minister in the Labour Government in bringing about that agreement.
That is the way in which to determine wage rates on foreign ships. They should be applicable according to the flag. One country should not be able to dictate the rate of wages for its nationals who are employed under another country's flag. That principle is simple enough. It is up to the Government to use it. The Minister may know that the union has given notice that the tradition in the industry of a maritime agreement that has allowed that practice to continue will finish within six months. That practice on British ships will end.
In his reply, giving his proposals for solving the problems in the industry, the Minister said:
"Protectionism and cargo reservation is growing elsewhere in the world. It must be halted and then reversed both for the sake of the United Kingdom and world trade. Over two thirds of our international freight earnings come from cross tradings".
That analyses the problem, but the Government are actively involved in developing protectionism. While both the Administration and the industry were backward in the UNCTAD agreements about the 40:40:20 formula, the Government have played a part in developing the Brussels package which is about protectionism and an agreement with the Third world countries about how we will share trade.
The Government are playing an interventionist role. Even though developed countries may have a free market philosophy, the Governmet will still intervene in world trade. In the written reply on 18 March the Government also said:
"the United Kingdom is regarded as such a long-time upholder of the principles and practice of open trading that for the United Kingdom to abandon open trading for protectionism would start a rapid move towards protectionism around the world—greatly to the damage of the United Kingdom."
The Government have endorsed a protectionist role in the Brussels package and the UNCTAD agreement. They have intervened with Russia and no doubt with Poland to get an agreement. Presumably they will seek to implement the UNCTAD agreement so that the Third world can play a part in developing free trade.
At the same time as expressing these views about free trade, the Government have been passing laws to protect British companies from giving information to the American Federal Maritime Commission about costs imposed on goods coming from America to the United Kingdom or going from the United Kingdom to America under the conference line system. The House rushed the
422
legislation through almost overnight to protect our people from an inquisition by private enterprise in America. Government actions in many fields are hypocritical.
In response to the industry's request for more subsidies, the Government take the view that
"Government subsidy blunts the incentive to create the necessary, truly commercial, competitive edge."—[Official Report, 18 March 1983; Vol. 39, c. 290–91.]
Although the Government take that view, they have done as much as the previous Government in pouring out a considerable amount of money in subsidy in one form or another. They are prepared to wreck the industrial base by removing subsidies, more in an ideological fit of passion.
The Government have made it clear that they are non-interventionist, but, when we consider what they are proposing, we see that they are playing an interventionist role in selected areas. They are not prepared to give new subsidies, although the money given to Cunard for the Atlantic Conveyor must have involved subsidies. Much must be going too through free depreciation.
The Government put themselves up as free market philosophers and say that they are not prepared to intervene. That is clearly nonsense, as shown by the examples I have given. What is more aggravating when we are looking for a consistent approach from the Government is that the Department of Trade and other Departments are actively involved in interventionist policies. In other spheres, such as textiles, the Government are bringing before the House protectionist measures time and time again to stop the flow of imports and to defend the industry. The same policy is being followed to a certain extent in the shipbuilding industry.
The Ministry of Agriculture introduced a measure on shipping, about which I assume the Minister was consulted, although he was not in attendance. The problem facing the Ministry of Agriculture was that Spanish trawlers, with Spanish seamen, were, as it saw it, pinching British fish. Within 24 hours, the Ministry of Agriculture put through the House a measure requiring that only British crews—because of community law it could not say British crews, but that is what it meant—will now be employed on British ships. That was active intervention to protect British capital and jobs by another Department involved with ships without any representation or statement from the Department of Trade. That principle is no different from that called for by the National Union of Seamen. It falls on deaf ears at the Department of Trade but on far more receptive ears at the Ministry of Agriculture, Fisheries and Food.
The Minister professes belief in free trade but ignores it in areas in which the Government wish to take protectionist action. The Minister's clear role in intervention is clear from the other question that he answered on 18 March. On that occasion, he maintained that Government intervention was necessary because, he said,
"1 believe that the decline of the British Merchant Navy can be halted and reversed."
He then let us into the secret of how that could be done. He said:
"United Kingdom crew manning levels, in far too many cases, are as much as 25 per cent. or more higher than those of European competitors—European competitors with high technical and safety standards, and with the extra crew costs, conceded over the years, such as reductions in tours of duty entailing heavy repatriation expenses which, taken together,

423
have multiplied the number of men that need to be employed to fill one seagoing job."—[Official Report, 18 March 1983; Vol. 39, c. 292.]
As a result of union negotiations, men no longer have to spend 12 months or two years at sea but can get home to see their families after three months. Of course that involves extra cost, but apparently the Minister expects us to give it up to save our merchant fleet. In other words, we must reduce our social standards and aspirations to the lowest level—that dictated by the market.
The Minister says that we must stop pressing for higher manning levels beyond those required for safety and stop seeking other crew-related improvements, but he ignores the crucial question of what constitutes safe manning. I hope that we shall hear from the Minister about that today. I presume that in coming to the conclusion that manning costs pay a major part he has compared them with his concept of optimum costs. Perhaps he will give us some examples. When I challenged him at Question Time, he said that his comparisons with fair crew costings related not to Panamanian or other flag of convenience fleets but to the Norwegians. I hope that he will support that with examples as I have sought the necessary information to make the same fair comparison. The Minister has in fact embarked upon an attempt to alter manning requirements, a number of which are laid down in the Merchant Shipping Acts, especially the requirements about certification—procedures which are less readily observed by flag of convenience fleets but which play a major part in the far better safety record of this country compared with the flag of convenience countries and Norway.
With regard to Norway, I have figures from various authorities and I shall await with interest the Minister's comments. It is clear that some Norwegian manning levels, especially in the 1,600 to 2,000-tonne area, are much higher than current British levels. I do not know whether the Norwegians intend to reduce their levels to ours, but in this context the Minister should bear in mind the difference in manning levels between the Irish and the British on the Union Star. The manning level on the Union Star under the Irish flag was 25 per cent. lower than that required under a British flag. The inquiry in Cornwall will show that the manning level was inadequate, as is already clear from the evidence given at the inquiry. Inadequate manning can lead to death and disaster with greater losses of seafarers and ships. Proper manning standards are vital to safety in these matters, and they are equally crucial on flag of convenience vessels.
The Norwegian manning proposals are not readily accepted by the trade unions in Norway. Indeed, trade unions from all over the world met in London last week and agreed to unite against the imposition of the Norwegian manning standards. They believe that they are, in some cases, lower than for flags of convenience and will lead to similar safety problems.
One considerable difference between the Norwegian approach and that of the Minister is that the Norwegians have announced that there will be a manning committee which will take account of ships' safety. Is the Minister prepared to set up such a committee to consider whether cuts in manning will affect safety? I assume that he asked himself such a question when he considered manning. I find the announcement in today's The Times startling. It says:
424
"Sproat to examine manning of ships."
We have been informed today that:
"The Department of Trade has begun a detailed investigation of Britain's 900-strong merchant fleet in an attempt to prove to shipowners and unions that the industry is seriously overmanned."
Did not the Department of Trade have such information when it made its conclusions of 18 March? Has it only just decided to conduct an inquiry? I have heard of making the judgment before conducting an investigation, but we assumed that when the Minister came to the House he had all those facts to hand and had discussed the issue with the owners and the unions. It is amazing that it has been announced today that he will set up an inquiry. That alarms everyone in the merchant fleet as the inquiry has been set up to convince the owners and the unions that the industry is overmanned. Apparently, the Minister is convinced. If that is so, has he come to that conclusion on practical information and if he has, why does he not present it for us all to see? We know what the inquiry is about—intervening on behalf of the owners to cut costs. It will be resisted strongly.
The Minister has not compared the manning levels of Panama and Liberia with ours. Moreover, it is no use giving us Norway's levels as it is not yet at the Liberian and Panamanian manning levels. We must see what happens to safety at those manning levels. The Minister should consider ship losses. In 1970, world losses were 600,000 tonnes whereas in 1980 it increased to 2·3 million tonnes. We now lose four times as many ships as we did in 1970. That has nothing to do with the weather. It is the result of deliberately sinking coffin ships for insurance purposes, the deliberate expansion of fleets and the failure to enforce safety standards. Ships sink all around our coasts and no one seems to give a damn about whether British or any other seamen are involved and no one carries out any investigations.
The researches of John Ruben shows that Panama now loses 64 ships a year. That is more than one each week. Greece loses 55 ships a year, Norway 10, Germany nine and the United Kingdom nine. Strict maritime control such as we have in our industry have led to a high safety record but flags of convenience lose four times as many ships as the average for OECD countries and eight to 10 times more than the traditional European fleets.
Flags of convenience, with their manning standards, substandard management and substandard nations which do not enforce proper standards, lead to the deaths of many thousands of seafarers—all in the name of free trade. What guarantee can the Minister give that, if we reduce ourselves to those standards, we might not experience exactly the same conditions and loss of life among our seafarers?
The Minister must give us much more convincing evidence about the difference in crew costs. The industry has always argued with the unions about crew costs. However, Malise Nicolson, who is the president of the General Council of British Shipping said:
"The CBGS accepts the criticism that in some cases UK crew costs are higher than those of European competitors but a levelling of these costs will not halt, let alone reverse, the decline of our fleet.
The basic fact is that the crew costs for European ships in general are hugely undercut by crew costs of the developing world whose seafarers do not seek such high standards of living."
The Government's answer is to cut the standard of living not only of seafarers but of workers in many other industries. It is the old Tory party fully at work.

425
What really incensed us was the Minister's reply to a question from the hon. Member for Bristol, North-West (Mr. Colvin) on 18 March. The hon. Gentleman asked the Minister
"whether he proposes to take any further measures, in addition to those already announced, to reduce the cost burdens imposed on the shipping industry by regulations."
The Minister replied:
"In order to increase the competitiveness of the Merchant Navy, I have been considering the costs involved in proposed regulations relating to the occupational safety of seafarers. I have postponed the requirement in regard to aluminium ladders of access to and from ships until 1 April 1984."
Part of the solution to this great slump in our industry is to reduce the provision of aluminium ladders. The Minister went on:
"I am proposing … to replace the requirement to apply a slip-resistant surface to open deck areas used regularly for transit … to reduce the required lighting levels in certain areas aboard ship to those recommended by the International Labour Organisation."
Those proposals will reduce the safety cover of seafarers in an industry that has 35 times more accidents than manufacturing industry, and four times more accidents than the mining industry, which is considered to be very dangerous. The Minister's contribution to the decline in shipping is to reduce safety considerations, despite his Department's reports having recommended those safety measures in the 1960s, 1970s and as late as 1978. The course upon which he has embarked will increase the death and accident rate.
I have said a great deal this evening, but I wish the Minister to consider carefully his answer to the hon. Member for Bristol, North-West, paragraph (iv) of which states:
" Not to apply the regulations to United Kingdom ships bare-boat chartered to foreign operators."—[Official Report, 18 March 1983; Vol. 39, c. 292.]
Does that mean that the ship can carry a British flag and be divorced from its obligations under our legislation if it is chartered to a foreign operator? If that is true, it will be a green light to foreign operators to obtain a British flag, with all the advantages that that has, without having to observe the traditional safety considerations of the British shipping industry. It is another green light to reduce yet again the proportion of British shipping.
I know that the Minister has received a reply from my general secretary—Jim Slater— of the National Union of Seamen, making it clear that his reply to that question undermines the safety regulations of the industry and gives a green light to an industry that has relied on recommendations instead of statutory requirements. However, my hon. Friend the Member for Hackney, Central introduced statutory regulations for access. The union has always believed that safety considerations should be taken away from the Department of Trade and put into the hands of the Health and Safety Commission. That commission controls many Departments, such as the Ministry of Agriculture, Fisheries and Food, and there has been a decline in accidents. However, Departments that control safety are subject to commercial pressures. The Minister's reply proves conclusively that the Department has cut safety regulations in response to commercial pressures.
I do not understand how the Minister could have said that, when only a few days previously the Under-Secretary of State for Employment said, during a debate on health and safety:
426
"I assure the House that the Government are determined to ensure that we have an effective health and safety system. There is no truth in the scare stories that the Government intend to destroy what has been set up. The existing system has an all-party basis and we intend to keep it that way."—[Official Report, 11 March 1983; Vol. 38, c. 1112.]
The Minister meant the health and safety legislation. He could not speak for the Department of Trade, but we have protested to the Department of Employment and referred it to the Health and Safety Executive because of the reduction in safety in an industry that has the highest rate of accidents and deaths.
The Government's answer to the decline in the merchant shipping industry seems to be that it can be stopped by the Government playing a non-interventionist role, a belief in the free market system and, presumably, further discussions with the industry. However, the industry will not want to discuss the matter further with the Government if these are the terms.
The Minister has had a letter from the general secretary of my union, making it clear that if he believes that the solution to our problems lies in reducing manning requirements, cutting safety standards and causing more death and accidents, and that that is the way forward for our industry, that is not acceptable. There is no point in having any dialogue with the Government. They are embarked on their course to cut costs at the expense of the safety of manpower in the industry. They have rejected the summary and recommendations of the NUS in its report "Heading for the Rocks", calling for intervention, planned trade and public ownership supported by the Labour party programme. I accept that the Government did not find that acceptable or palatable, but I find it objectionable, as I hope that the House will, that the Government wish to stop the decline in the fleet by building on the backs of injured and killed seafarers, and by reducing safety standards. That is unacceptable and is resisted by all unions, officers and ratings and, one would hope from the remarks made by the owners, all in the industry who refuse to go back to the conditions of the 19th century.
9.11 pm
Mr. Clinton Davis: I apologise on behalf of my hon. Friend the Member for Batley and Morley (Mr. Woolmer), who normally speaks on shipping matters for the Opposition. for his unavoidable absence.
I congratulate my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) on having the good fortune to be able to raise this issue on the Adjournment and on speaking with that characteristic bluntness and common sense that is girded by great expertise. I hope that the Minister will take to heart some of my hon. Friend's comments.
I willingly pay that tribute to my hon. Friend, because he and I have had the pleasure of working together in the Department of Trade, he as Parliamentary Private Secretary to the Secretary of State for Trade. He made a powerful contribution to the discussions that took place over shipping during the period that he was in that position.
There are a number of common denominators that must mark any debate on shipping at the present time. One is that the merchant fleet is still of monumental importance to this country, as an island nation, for defence, trade and foreign earnings. A second common denominator is that the merchant shipping industry and its seafarers made a major contribution during the Falklands Islands campaign,

427
although what happened was infintely less than satisfactory and was an unhappy augury for the future, because, as the Merchant Navy and Airline Officers Association has reported; there were grave causes for disquiet during that campaign. I declare an interest in this, as I am an honorary member of that association.
The Minister is aware of this problem because of the evidence submitted to him by the association. Under the heading "The Merchant Navy in Defence", it said:
"It appears that the Department of Trade experienced difficulty in finding the necessary vessels, and from press reports it is apparent that there was a shortage of sea transport. We do not believe that the optimum level of fleet support for the Task Force was capable of being found from the United Kingdom"
That has never been rebutted, so perhaps the Minister will take the opportunity to comment on that. It went on to say:
"It is ironic that the United Kingdom registered fleet was unable to provide the number of vessels needed. In one case, Bermuda registered tonnage was chartered from a company which at the same time had a ship trading with Argentina. It is nothing short of a scandal that companies which evade the tax and legal obligations of United Kingdom registration should be considered sufficiently loyal to be trusted with a role in the Task Force."
The Minister must answer that point tonight, because he has not answered it hitherto.
The third common denominator is the tragedy of the merchant fleet, which is in marked decline. I shall again put on record, as part of the background to this debate, the catalogue of disaster that has occurred since May 1979. The number of ships has fallen by 32 per cent.; tonnage has fallen by 36 per cent.; and more than 550 ships have been sold abroad, many to flag-of-convenience operators who are now in competition with the remainder of our fleet. In 1982 alone the number of ships fell by 13 per cent. and tonnage by 16 per cent. At the end of January this year, 16 per cent. of our registered fleet was laid up—four times as much as at the end of Jauary 1982. That is a sad situation. It is almost a situation of despair, yet the Minister's contribution has been primarily to attack the trade unions.
The Minister has been extremely abrasive during Question Time. If abrasiveness, arrogance and unwavering conceit were substitutes for policies, our merchant fleet would be doing very well under his guidance. Instead, he lives in a make-believe world. In this regard he apes the Prime Minister. It is never he who has a shred of responsibility for the disaster that has befallen the merchant fleet; it is always the international recession, the evil of trade unionism and the greed of seafarers.
The Minister lives in a world of slogans and very little common sense. He asserts unequivocally that market forces must determine the shape and size of the British merchant fleet. That is what he told me in answer to a written question only the other day. If the fleet is left to those market forces, how does the Minister perceive that it will be able to recover when the shipping markets improve? As I have already said, our ships will have been sold abroad or scrapped and our industry will simply be unable to cope with the competition. How will he replace the qualified seafarers? How will he deal with the institutions that train them? By then many of those institutions will probably have disappered or, at least, have been substantially run down.
The Minister's is a world of negativism. He rejects the ideas, based on considerable skill and expertise, that have
428
been put forward by both sides of industry, and, in turn, he is rightly condemned by both sides of industry. For him there is no real argument about public ownership having a public stake in the shipping industry, simply a rejection of that argument, and similarly with subsidies. He says that there is no departure from market forces, which dominate his thinking and have proved to be so catastrophic to the industry thus far.
The Minister's is a world of bare assertion, though not necessarily the naked truth. In a debate initiated by the right hon. Member for Taunton (Mr. du Cann), the Minister said of defence:
"Our assessment is that defence needs can still be met. This matter is at the heart of our current review of what lessons to learn from the Falklands".—[Official Report, 25 November 1982; Vol. 17, c. 1111.]
It is only an assessment that we can still meet our defence needs. That does not exactly have the ring of confidence.
Let us test what the hon. Gentleman has to say about the adequacy of the fleet for defensive purposes. What does he think should be the level of the fleet to be consonant with our defence requirements? What size of fleet, what type of ships and how many trained personnel are required? What is the position likely to be in five years, for example? Has the hon. Gentleman any idea what it will be if the current rundown of the fleet continues? What research is being undertaken by his Department, by universities or within the industry?
There are many lessons to be learnt from the Falklands, including the contribution that our seafarers have to make in future. However, there is no place for them on the Shipping Defence Advisory Committee. Tributes to the seafarers trip off the hon. Gentleman's tongue—it is easy to make them. He has paid glowing tributes, and rightly so, to the heroism of the merchant seamen who went to the Falklands, but why cannot they make a contribution to the Shipping Defence Advisory Committee? Is their expertise of no concern to the hon. Gentleman?
The committee is concerned with adaptations to new and existing ships to ensure that they can fulfil a role as a defence factor. It seems that the hon. Gentleman and his colleagues at the Ministry of Defence consider the merchant seafarers to have no place on the Committee.
Another example of the Minister's negativism is that he is taking no action on flags of convenience, except in respect of those ships which are substandard—
Mr. Prescott: Or Russian.
Mr. Davis: The hon. Gentleman would not call the Russian fleet a flag of convenience. It is of interest that there is a tremendous contradiction between the way in which the Minister approaches the threat of Soviet shipping—I believe that it is a peripheral threat because it engages in unfair competitive standards—and the threat posed by flags of convenience. Why does the hon. Gentleman not condemn the unfair competitive standards of flags of convenience, such as lower wage rates, unsafe conditions on board ships and inadequate training? My hon. Friend has recited a catalogue of unfair standards. In flags of convenience there are often lower safety levels in ships which are not substandard. I hope that the Minister will comment on lower safety levels, as distinct from substandard ships.
Mr. Dennis Skinner: The Minister does not care.
Mr. Davis: What is the Minister doing to implement a proposal which I put to IMCO in 1977, and which was taken up, to establish a marine safety corps to Third world countries to develop higher safety standards? Is he pursuing that with the International Maritime Organisation?
My hon. Friend referred to the answer that was given by the Minister on 18 March. What consultation did he engage in before coming to the conclusion that the regulations could be changed in the way that he set out in his answer? Does he think that seafarers have no role in consultations which directly touch their everyday lives? If no agreement was reached about those matters, perhaps he would be kind enough to explain why. What was the view taken by the unions, or does he not care about that either?
I suggest that the Minister is playing a dangerous role here, because he is playing with people's lives and he does not attach enough importance to that. He is imbued with the doctrine of market forces. For generations Britain has taken a pride in the application of sound safety standards, even if they reduce competitiveness marginally. In the past Conservative Ministers have played a noble role in upholding that tradition, but this Minister seems determined to change it without consultation—almost unilaterally.
Mr. Prescott: The Minister is determined not only to change it, but—we await his reply—apparently without proper examination. He examines matters after he has reached his conclusion.
Mr. Davis: The Minister sets up working parties and all sorts of things, evidently, as my hon. Friend said, having reached his conclusion in advance. He must justify far more than he has in his written answer the peril—the increased peril—that will be faced by seafarers.
My hon. Friend has deployed powerful arguments in his indictment of the Minister, and I support them. I want to put several questions to the Minister and he will have plenty of time to answer—one hour and five minutes. First, is he satisfied with the research that is being done within and about the shipping industry? Second, if he is so satisfied, why is he unable to reply to the question that I put to him on 14 March and which I think is of some moment? I ask him how many owners had flagged out tonnage from and into the United Kingdom registry in annual periods from May 1979 onwards. His answer was:
"I regret that the information requested is not available."—[Official Report, 14 March 1983; Vol. 39, c. 68.]
It is a matter of considerable concern to the British shipping industry to know what is happening about flagging out. If the Minister cannot answer, it is utterly shameful.
Third, has the Minister made a decision about the establishment of a think tank for the industry as was proposed by the Merchant Navy and Airline Officers Association? If not, why the slothfulness? Why cannot he get on and make a decision? That is of particular importance if there is a dearth of adequate research in the industry, as I believe to be the case, which, if anything, has become worse over the past three years, although I do not entirely blame the Government for that.
Fourth, why should there not be a higher level of United Kingdom flag involvement in the Norwegian sector of the North sea, when it is abundantly plain that Norwegian involvement in the British sector is vast by comparison with ours in the Norwegian sector? How would it possibly
430
affect our interests in the cross trades if we were to take seriously what has been happening? It is a one-off matter that affects our relations with Norway and the Minister ought to be doing something about it. Indeed, how does he reconcile that inertia with the countervailing action that has been taken by his colleagues in the Department in introducing the Protection of Trading Interests Act 1980 in order to take protective action against the United States?
Fifth, what are the Government proposing to do about the report on the employment of non-domiciled seafarers, to which my hon. Friend referred?
Mr. Donald Thompson (Lord Commissioner to the Treasury): Nothing.
Mr. Davis: Is it absolutely nothing? A consensus was reached in the industry on this matter in order to eradicate an injustice based on racism, about which the Minister apparently cares little or nothing.
Sixth, why should training costs continue to fall on British industry to a much greater extent than happens in other countries? If the Minister is so worried about Britain's waning competitiveness, what is he prepared to do about that?
Seventh, why does the Minister reject so peremptorily the provision of investment assistance, subject to proper safeguards and conditions, as submitted by the MNAOA and the National Union of Seamen?
Eighth, why is the Minister so dismissive of the contribution that can be made by the British seafaring unions? When I went to the Department of Trade, I had no more knowledge than the Minister. It was as well to listen to people who had a lifetime of service in the industry—the owners and the trade unions. The Minister began extremely well by convening a tripartite meeting at Windsor, which was regarded as a very good augery for the future. He listened to the contributions, and my understanding is that he was impressed by the contributions that were made by both sides of industry.
The tragedy is that the Minister has departed from that. There has been nothing like it since. Why is the Minister not prepared really to open the doors of his Department so that a proper debate can take place? The industry is at crisis point. Instead, the Minister has shrugged aside the trade unions and insulted them at every turn, and the suggestion that they are responsible for the decline of British industry is deeply resented. It is not too late to change, and it is never too late for anybody to admit errors. I have made many errors. I have not always agreed with the trade unions, by any manner of means. Sometimes they were right and I was wrong, and sometimes the owners were right and I was wrong. It is worth listening, because the unions have something worth while to say.
The Minister said in a statement on 18 March that he would set up a regular form of tripartite discussions with the Government. The General Council of British Shipping and the seafaring unions have told the Minister that they would welcome a continuing and regular form of tripartite discussions with the Government. He said:
"I regard this as a constructive suggestion."—[Official Report, 18 March 1983, Vol. 39, c. 291.]
That is fine, but the hon. Gentleman must prove that he is prepared to listen to other people. There is no point in having tripartite discussions if the Minister's ears are closed because they would then be just a formality.
Mr. Prescott: When the answer was given by the Minister, the unions had not been subjected to the

431
offensive response on the other matters. That has conditioned their response to further discussions, as the Minister knows from a letter from the unions.
Mr. Davis: My hon. Friend is right. I was present at Question Time on 21 March. The Minister was offensive—I put it no higher than that—to the trade unions. If the Minister expects the unions to play a role in tripartite discussions, which I trust will take place, he must be a little more flexible, a little more realistic and a little more understanding of the role that they can play.
Lastly, what will the Minister do to staunch the flow of ships from the flag?
The Labour party proposed in the Merchant Shipping Bill in 1978–79 taking steps in clause 31 to stop undesirable foreign takeovers that were prejudicial to the national interest. The Conservative party stopped that when we lost the vote of confidence.
The Government have proposed nothing. I do not say that the injunctive effect of those proposals would have been a panacea by any manner of means, but it could have made a contribution to the problem now besetting the British shipping industry. The Minister must get the idea out of his mind that the crisis has developed solely because of the trade unions and the seafarers or that it is perhaps solely due to a joinder of matters, such as that factor and the international recession.
Of course the international recession has a part to play, and it is true that everyone is suffering, but that is no reason for inaction on the Minister's part. The hon. Gentleman has introduced a note of real confusion about manning costs. That is my judgment and that of the president of the General Council of British Shipping, Mr. Nicholson, who has rightly said that the Minister is seeking to compare our manning costs with those of flags of convenience and Third world countries. There is no way in which those two sets of costs bear comparison. Indeed, in his heart, the Minister knows that. Therefore, he has a lot to answer for, not only to me and to my hon. Friend the Minister for Kingston upon Hull, East, but to the nation and those on both sides of the industry who have given years of dedication and devotion to it. So far, the Minister's answers have been found grotesquely wanting.
9.37 pm
Mr. Don Dixon: I should like to emphasise some of the points made by my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) about flags of convenience. I have worked on ships sailing under flags of convenience and I can verify that safety conditions or regulations leave a lot to be desired. My hon. Friend the Member for Hackney, Central (Mr. Davis) referred to the Falklands issue. I asked the Minister a question about two container ships that were transferred from the red ensign to flags of convenience at the time of that dispute so that they could carry on chartering or trading with the Argentine. I received a parliamentary answer that was typical of the Minister, saying that, as they had a charter to trade, all was well.
I am concerned because, as my hon. Friend the Member for Kingston upon Hull, East has pointed out the British merchant fleet has declined in the past seven years from 1,636 to 900 vessels. I come from an area with one of the best marine and technical colleges in this country, if not
432
in the world, yet no training is taking place. If the reason for the decline in the British merchant fleet is the world recession, we shall not have the trained seafarers to sail the ships that will be needed for trade when, if ever, we get out of that recession.
West Germany has the same problem as this country, yet according to Lloyd's List of Tuesday 10 February it has increased training for seafarers. Lloyd's List states:
"West German shipping continues to place great emphasis on training qualified personnel. In all some 557 businesses concerned with shipping offer 1,737 training places. In 1982, 465 apprentices were accepted, an increase of 16 per cent. compared to 1981."
In Britain, the training colleges are being closed—south Tyneside faces that problem.
Mr. Prescott: And Hull.
Mr. Dixon: One of the most obscene articles I have ever seen appeared in The Times on Tuesday, 15 February. An article by Barrie Clement entitled "BSC is bypassing own ships" said:
"Foreign ships are being chartered by the British Steel Corporation while three of four of its own British-crewed vessels are laid up … But the corporation says it has no intention of changing its present policy to use its own vessels and other United Kingdom ships whenever it is commercially feasible to do so. The corporation has laid up three bulk ore carriers and has six foreign vessels on long-term charter; two are Norwegian, one of which sails under the Panamanian flag; another is French; two are registered in Hong Kong and one is German-owned but registered in Liberia."
The British Steel Corporation, a nationalised industry, is laying up its own British-built ships and chartering flags of convenience ships. That is obscene and the Minister should do something about it. I have no doubt that he will not. He should ensure that the British Steel Corporation uses British-crewed ships.
The Select Committee on Industry and Trade held a long session on the state of the British shipbuilding industry. In recommendation 5 of its report, it suggested that there should be co-ordination on shipbuilding and shipping between the various Government Departments. We look forward to such co-ordination. Britain must be one of the few countries in the world which has no maritime policy.
In Committee on the British Shipbuilders Bill, when we tried to discuss defence orders with industry Ministers, we were told that defence order had nothing to do with them and that we should discuss the matter with the Ministry of Defence. When we discussed the merchant shipping fleet, we were told by industry Ministers that that had nothing to do with them and was a matter for the Department of Trade. We need a co-ordinated maritime policy. When one considers that 98 per cent. of our trade enters or leaves Britain by sea it is essential not only to have a merchant fleet but the capacity to build and maintain it. I hope that the Minister will answer the questions asked so ably by my hon. Friends tonight. I hope that the Minister will be able to do something because the industry is in a parlous state. The sooner the Minister gets off his backside to do something positive about it, the better it will be for all concerned.
9.43 pm
The Under-Secretary of State for Trade (Mr. Iain Sproat): I share with the hon. Member for Kingston upon Hull, East (Mr. Prescott), with other Members and with many of the public, great concern about the United

433
Kingdom merchant fleet. That concern has been with me throughout the time I have had responsibility for shipping matters and naturally formed a major part of the response to the question I posed to the General Council of British Shipping and the seafaring unions about the lessons of the Falklands campaign and the future of the Merchant Navy.
The hon. Member for Kingston upon Hull, East said that he hoped that there would be time for a full-scale debate about the future of the Merchant Navy. I would welcome such a debate and I am rather surprised that the Opposition have not made one of their supply days available for it. I look forward to debating this important subject at rather greater length than is possible this evening.
I must repeat what I have said previously—that the adequacy of the merchant fleet for defence purposes is kept under continual review by my right hon. and hon. Friends. In the considered opinion of the Ministry of Defence, the merchant fleet remains capable of meeting defence plans. I cannot emphasise that point too strongly. Although, after careful consideration, I rejected the two elements put to me—subsidy and protectionism—-that does not show any disregard for the health of the industry. On the contrary, I rejected them because they would have worsened rather than improved the position.
Mr. Clinton Davis: We know precisely what the Ministry of Defence has said, and what it must necessarily say. But what evidence does it have for saying so, in the light of the submissions from the unions about the inadequacies that occurred during the Falklands crisis—not only in the availability of shipping but in the training that took place between the Merchant Navy and Royal Navy to deal with everyday tasks that had to be fulfilled?
Mr. Sproat: Everything that the unions and the General Council of British Shipping have said on that matter has been taken fully into account in reaching the conclusion that the Merchant Navy is fully capable of meeting our defence plans.
It is often alleged that direct subsidies by other countries to their merchant fleets give them an unfair advantage. The hon. Member for Kingston upon Hull, East (Mr. Prescott) implied that. Apparently, subsidies are the reason for the growth of those fleets, and the lack of subsidies the reason for the decline of our fleets. It is said that we should introduce subsidies.
Yet direct operating subsidies to shipping are not common throughout the world. It is true that many shipbuilding industries receive large subsidies, but it would be a mistake to see them as subsidies to shipping industries. On the contrary, those subsidies are, to a considerable extent, responsible for the excess tonnage in the world and the unrealistically low level of freight rates.
To try to nullify the distortion caused by shipbuilding subsidies through introducing operating subsidies, thereby adding further distortion, would be not only extremely expensive but ineffective. It would inevitably lead to the introduction of subsidies by yet other countries. It would give no lasting benefit, but would merely place yet another burden on the already over-burdened taxpayer.
Mr. Prescott: The Minister obviously did not listen to what I was saying. Admittedly, I made a somewhat lengthy speech, but I did not argue for operating subsidies. Indeed, I have always argued against intervention money
434
for shipbuilding. We can intervene in more effective ways to secure traffic. Pouring in additional money has never been part of my argument.
Mr. Sproat: It may not have been part of the hon. Gentleman's argument this evening, but it has certainly been part of the argument that members of his union have put forward. It is an important argument. That is why I wanted to answer it directly this evening by saying that I reject it.
The extent to which the arguments on subsidies are fallacious are matched by similar fallacious arguments often on protectionism. There is, of course, widespread pressure for protectionism. In developing countries, widespread limitations on the freedom of shippers to choose the vessels to carry their liner cargoes do indeed exist, but the extent that it has reached can be easily exaggerated. Among the developed countries, which generate most of the world's liner cargoes, cargo reservation is very much the exception. The role of the United Kingdom must be to join hands with those countries which are working to resist the spread of such practices, not to adopt them ourselves.
I should be failing in my duty to the merchant fleet if I ceased to hammer home the importance to our fleet of the crosstrades. It is an argument that I have given the House before, as the hon. Member for Kingston upon Hull, East was good enough to mention, in reading out many of the splendid answers to questions which I have been giving the House recently. Of course, many in the shipping industry accept that argument, but it would appear that there are also others, as we have heard in the House this evening, who do not accept it. Therefore, I should like to explain it again, because it is so important.
United Kingdom shipping depends crucially on the crosstrading opportunities open to it. Over two thirds of its freight earnings come from trading between foreign countries. This is only possible because shipping worldwide is still to a considerable extent open, but in spite of this, we could be sure that if we denied competitive access to our cargoes to other countries' shipping, they would deny it to ours. We should then have contributed to a slide into protectionism that would harm our shipping interests greviously. For all our position as a trading nation, we just could not protect and sustain a fleet of the current size, despite the decline that has occurred, merely on the carriage of our own national trade. We could not do it, and the. House and the industry must face that fact. Those who urge the Government to turn towards protectionism in shipping are, in reality, whether they realise it or not, asking it to put at hazard the cross-trade shipping responsible for two thirds of our freight earnings, and all the jobs that depend upon those earnings. A protected fleet would be a smaller fleet.
Mr. Prescott: It is a crucial argument, and I do not deny it. Will the Minister tell us which countries he thinks would be a countervailing force if he were to adopt these policies? Norway gets much more from its crosstrades and has been able to maintain a protectionist interest around its own coasts, as we have seen in the North sea, with the development of maintaining its supply ships.
Mr. Sproat: The hon. Gentleman does me the credit of saying that this is a serious argument, as indeed it is. I ask him to accept that many countries, certainly in the developed world, are under pressure at the moment to go

435
further down the protectionist road—for example, the United States. Many forces in the United States are urging greater protectionism. I well remember reading a speech by Ambassador Brock in Washington last January, when he said that if any other country were to go further down the protectionist road they—the Americans—would be forced to go further down that road.
Mr. Prescott: What about the Jones Act?
Mr. Sproat: The Jones Act is coastal trading. We are not talking about coastal trading, because the two thirds of British freight earnings that come from cross trading does not include cabotage within the United States. I would certainly like to see the Jones Act removed—we all would, of course—but that does not affect the argument that I am making now, which is that, if we were to go more protectionist, the United States would go even more protectionist than it has gone under the Jones Act. Furthermore, it is not true to say that there are overt statutory protectionist pressures on the supply vessels in the Norwegian sector of the North sea.
I have personally been into the matter in the greatest detail with the Minister for Commerce and Shipping in Norway. He has been over here. My officials have been with his officials. The fact is that, although the proportion of British supply vessels in the Norwegian sector of the North sea is very low—that is why I opened up the matter—it is not because there are overt or statutory protectionist measures by the Norwegian Government. On the contrary, the Norwegian Minister for Commerce and Shipping has said time and again that he would deplore and does deplore any such protectionist attitudes. Over the years, the protectionist attitudes of previous Socialist Governments in Norway have generated such an atmosphere of non-statutory protectionism that this has happened. There is absolutely no statutory protection of supply vessels in the Norwegian sector of the North sea, for the very good reason, which by implication the hon. Gentleman adduced, that over 90 per cent. of Norwegian freight earnings come from cross trading, as opposed to 68·2 per cent. in this country. Therefore, the Norwegians have even greater reason for believing in open trade. Only last week the Norwegian Minister, Mr. Skauge, whose sterling efforts to keep maritime trade as open as possible I warmly applaud, not only discussed with me the present situation there but reaffirmed Norway's commitment to open trading policy.
I shall go on from that important digression. We cannot discuss the freedom of shipping as if it affected shipping alone in this protectionist argument. We cannot do so. We are an island trading nation. We must rely on efficient shipping services, which of course means internationally competitive shipping services. I am convinced that we have to preserve international competition in shipping if in the long run we are to preserve international free trade in the merchandise that those ships carry.
Indeed, the arguments about protection and free trade are at bottom the same in shipping as in manufactured goods. Industries claim protection in the hope of perserving employment. Protection cannot do so in a general sense. The most that it can do is to shift unemployment from one industry to another, thereby generating further claims for further protection.
436
Our shipping industry is a national asset because it has built up a worldwide profitable trading position. That is its distinctive contribution to the national welfare. It would cease to be a national asset and would become a national liability if it had to rely on subsidies or protection, because either of those expedients would throw the burden of its problems onto other industries, and insult the maritime traditions of which the industry and the House are proud.
In keeping with that realistic approach, we must continue forcefully to argue the advantages of open trading in international and bilateral forums. It is in the nature of international shipping policy that it is not widely publicised. Complex international negotiations do not thrive by being thrust under a political spotlight.
However, it is hardly relevant to the debate on protectionism to give an account of what we are doing. I should like to do so now. For example, recently the United Kingdom played a leading role in establishing a system within the EC for monitoring the presence of non-commercial eastern bloc shipping on certain major routes serving the United Kingdom and other EC ports. We played the leading part in the development of the EC's common position on the United Nations liner conference code, to which the hon. Gentleman referred, although he got it the wrong way round by saying that the Brussels package was protectionist, whereas in fact it is the most we can do to open up trade as far as possible. We continue to play a major part in negotiations seeking to apply similar free trade principles in shipping relations with countries outside the Community.
Very importantly, we played the leading part in getting agreement on the Paris memorandum of understanding whereby 25 per cent. of all foreign ships coming into the ports of 14 European nations have been and are being monitored for safety standards since last summer and, if necessary, held up until deficiencies discovered are put right. This will probably prove to be the most important single measure to improve safety taken this century; and will certainly do far more than misconceived campaigns against open register.
It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Hogg.]
Mr. Sproat: Especially important are our relations with the United States of America. The maritime countries of Europe and Japan, which form the consultative shipping group, have recently been holding discussions with the Americans on the dangers posed by all forms of protectionist shipping policies, and the need for reciprocal guarantees of competitive access to each others 'trades. For all the market economy countries involved in these negotiations, preserving efficiency in the seaborne transport of our goods to and from their markets is just as important as the quest for efficiency in manufacturing industry. That efficiency cannot be preserved except through competition, and I believe that we have an opportunity this year, in concert with our trading partners, to secure a more firmly assured future for competitive conditions in world liner shipping. This Government intend to make the most of that opportunity.
In my view, the future of our shipping industry can be assured only by its efficiency and ability to compete in world markets, and efficiency can be achieved and preserved only through competition. There are those who

437
still see the roots of our decline in the competitive advantages that flags of convenience or open registers are alleged to obtain from substandard vessels and cheap labour. Whoever talks abour open registers in this country must ask himself very carefully, "open to what?" Many people mean by flags of convenience, or open registers, any register which is open to foreign investment. Some people find it hard to remember that some 45 per cent. of the British Merchant fleet is beneficially owned abroad. If open registers were banned, 45 per cent. of the United Kingdom fleet might vanish overnight, and 45 per cent. of the jobs with it. It would be madness to wound and destroy ourselves in this way.
Mr. Clinton Davis: If, as the Minister says, there is such a vast amount of foreign capital invested in British ships, and presumably in British crews, how does he reconcile that with the argument that our manning costs are so impossibly high?
Mr. Sproat: Our manning costs are indeed, unfortunately, uncompetitively high in too many cases. What I am seeking to do is to make our merchant fleet more competitive so that we can ha1t the decline of the fleet, whether by vessels beneficially owned abroad or by vessels beneficially owned in this country. Of course, manning levels are not the only factor. We have a very good tax regime for merchant vessels, but the one has to be traded off against the other. What worries me is that the fleet is declining because the uncompetitive element is gaining the upper hand and owners are not finding it possible to operate as they did in the not too distant past under the conditions which are imposed upon them.
When I saw the hon. Member for Kingston upon Hull, East rising when I referred to flags of convenience or open register, about which he had been so critical, I wondered if he was about to explain to us why his Government did absolutely nothing that I can recall to stop this practice. We have had the Parliamentary Private Secretary at the Department of Trade in the Labour Government—I had forgotten that—and the Labour Under-Secretary of State for Trade going on this evening about the evils of open registers, although I do not believe what they said. If they thought that the system was so evil, why did they not do something about it when they were in power? It is the most ludicrous form of hypocrisy to try to shift the blame on to someone else for aspects about which they themselves did so little when they were in power.
Mr. Prescott: Will the Minister give way?
Mr. Sproat: No, I must get on because my hon. Friend the Member for Northampton, North (Mr. Marlow) is seeking a further debate that I am anxious to answer. I have given way three or four times already and my hon. Friend is beginning to get that pale and restless look. I do not want it to become any worse.
Mr. Dixon: What the Minister has said is quite untrue.
Mr. Sproat: It is a convenient deception—
Mr. Prescott: Will the Minister give way?
Mr. Sproat: —and for that reason a popular one—
Mr. Prescott: On a point of order, Mr. Deputy Speaker. I should like your advice. If a serious accusation is made in the cut and thrust of debate, have hon. Members the right to reply to it?
Mr. Deputy Speaker (Mr. Ernest Armstrong): If the Minister is not giving way, the hon. Gentleman must resume his seat.
Mr. Sproat: I have listened for well over an hour to Opposition speeches attacking the Government on issues about which, to the best of my recollection, the Labour Government did absolutely nothing—certainly nothing effective.
Mr. Prescott: We are trying to tell you what we did, you arrogant man.
Mr. Sproat: I propose to get on, so that my hon. Friend the Member for Northampton, North can introduce his extremely important debate before the House has to close down for the night.
It is a convenient deception, and for that reason a popular one, to suppose that all open register vessels flout international safety requirements. Those that do ought to be dealt with, can be deal: with and are being dealt with through international agreements on port state action of international safety standards. It is wrong to attribute to open registers the competition from the comparatively low wages of Third world crews. Crews from many developing countries can man vessels of any register competently and safely at wages which, though low by the standards of developed countries, are high by the standards of their home countries.
Clearly, wage costs for crews from developing countries will continue to pose difficulties for our fleet, just as they do for those of other developed countries, but much of our competition is from developed countries themselves—a point that the hon. Member for Kingston upon Hull, East failed to face when he opened the debate.
We should certainly be able to meet that competition, but how can our merchant fleet organise itself to do so? What is needed in this area is for management and unions to deal effectively with unnecessarily high operating costs, such as the overmanning which far too often puts our fleet at a competitive disadvantage. I say that there are far too many cases because we have taken a wide sample of comparative costs and have found that in too many cases our vessels are overmanned by comparison with the best of our European competitors.
Mr. Prescott: Will the Minister give examples?
Mr. Sproat: The absurd allegation has been made that I am urging reductions in manning below acceptable safety levels or adopting the numbers and standards practised by some flags of convenience countries. That is just not true. I am not saying that. I am saying that in many cases, although not in every case, we are overmanned by comparison with many north European crews, such as those of Norway, Germany and Belgium—countries which have exemplary safety standards. In some cases, the difference is as much as 25 per cent.
Mr. Prescott: Give us some examples.
Mr. Sproat: Those unnecessary costs are compounded—
Mr. Christopher Price: On a point of order, Mr. Deputy Speaker. Is it in order for a Minister to rabbit on from a departmental brief and refuse to give way to Opposition Members who really understand these things?
Mr. Deputy Speaker: The hon. Gentleman knows that that is not a point of order for the Chair.
Mr. Sproat: Not only is it not a point of order for the Chair. As the hon. Member for Lewisham, West (Mr. Price) has been here for only about five minutes, it is not a point of order for anyone.
Mr. Dixon: Will the Minister give way?
Mr. Sproat: These are some of the factors behind our competitiveness—
Mr. Dixon: On a point of order, Mr. Deputy Speaker. I was under the impression that when an Adjournment debate began early it would continue until 10.30 unless a further Adjournment debate was put down before 8 o'clock, in which case, if the first Adjournment debate folded before 10.30, the second could then take place. Am I to understand that the Minister is now trying to hurry this Adjournment debate because his hon. Friend put down another subject before 8 o'clock?
Mr. Deputy Speaker: I am not responsible for the length of the Minister's or any other hon. Member's speech. If this Adjournment debate finishes before 10.30 pm, we shall get on to the next one; if it does not, the House will adjourn.
Mr. Dixon: Do I take it that, when the Minister finishes, this Adjournment debate finishes? Cannot other hon. Members continue and answer some of the points the Minister has made?
Mr. Deputy Speaker: We shall see about that when we get to it.
Mr. Sproat: Thank you, Mr. Deputy Speaker. I am trying to give the maximum number of hon. Members the opportunity to air the maximum number of issues. My hon. Friend the Member for Northampton, North applied for another Adjournment debate early this evening. He is entitled to have it if possible.
Mr. Prescott: On a point of order, Mr. Deputy Speaker. I thought that my hon. Friend the Member for Jarrow (Mr. Dixon) made the point that an hon. Member must apply for another Adjournment debate before a specified time. The Minister appears to be under the impression that he should conclude his speech to make way for someone else to have another Adjournment debate—
Mr. Deputy Speaker: Order. I understand that the hon. Member for Northampton, North (Mr. Marlow) made his application before 8 pm in accordance with the usual procedure for a second Adjournment debate. We have not yet reached the second Adjournment debate; we are still on the first one.
Mr. Sproat: The hon. Member for Kingston upon Hull, East spoke about safety. The Government have a responsibility for safety at sea, part of which is to ensure that safety and environmental regulations are realistic and appropriate. I continue to keep them under review.
The House will know that I have recently taken several initiatives. I shall give two examples. [Interruption.] The hon. Gentleman says from a sedentary position that—
Mr. Prescott: Sedentary? The Minister will not give way.
Mr. Sproat: I have already given way three or four times. The answer is yes. It has been discussed and it has been agreed. Yes. I hope that that will satisfy the hon. Gentleman.
Mr. Prescott: No, it does not.
Mr. Sproat: First, I have set up two working groups that include representatives both of shipowners and unions. They are to study ways of removing unnecessary cost burdens concerning equipment and crew accommodation when ships transfer from a foreign flag to the United Kingdom flag. Such transfers are in our national interest. The working groups' aim is to facilitate those transfers by avoiding unnecessary replacement of foreign equipment which complies with adequate but different standards.
Secondly, I have examined the programme of regulations that we have made, or are proposing to make, to protect seamen at work aboard ship. As a result, I have agreed to some changes to reduce cost burdens which promised little or no benefit. That accords fully with a recent approach from the National Maritime Board, which represents both sides of the shipping industry, that any further occupational health and safety regulations should be subject to cost-benefit analysis. I must emphasise that that marks no departure from the undertaking that I gave to the House on 6 April last year to ensure that seafarers should, as far as conditions afloat permit, enjoy a level of protection which is no less than that afforded to workers ashore under the Health and Safety at Work Act 1974. To that end, we continue to work closely with the Health and Safety Commission and the Health and Safety Executive. I can assure the House that efficiency is not being sought at the expense of safety.
A Government cannot reverse the fortunes of the shipping industry alone when the conditions within which the industry operates and the costs it has to meet are not set by the Government, but it would be wrong to overlook the way in which successful counter-inflation policies have given direct help to the shipowner in keeping down his operating costs. As I have said, I am now engaged in a wide ranging exercise to remove as many costly regulatory burdens from the industry as is consistent with safety. No British Government that I know of have done more to lessen the load of regulations within the bounds of safety.
Protectionism and subsidy will not help. It is the efforts of those involved in the industry that will safeguard their own future in an open trading environment. The ability of the Government to contribute is therefore limited, but I am anxious that we should do what we can that is sensible. There have been tripartite discussions before. The Government stand ready to help the two sides of the industry to identify where and how costsavings can be made, if they wish it and if they accept that the responsibility for action lies with them. I hope that those involved do not adopt such an entrenched position that we cannot talk again. We owe it to the merchant fleet, to those engaged in it, to the country as a whole and to our maritime heritage to do so.
I was especially sorry to read in today's newspapers that the National Union of Seamen will withdraw on 30 September from its agreement with the General Council of British Shipping permitting the employment of foreign ratings on British ships, with the apparent intention to pressure British shipping lines to dismiss foreign ratings and to replace them with British ones. Yet again we

441
encounter the fallacy that a failure of international competitiveness can be cured by such means, but actions that raise the cost of operating British ships—
Mr. Prescott: Will the Minister give way?
Mr. Sproat: —will mean fewer jobs, not more. I hope that the National Union of Seamen means it when it says that it wishes to stem the decline of the British fleet. I believe that it does, but it can demonstrate that only by striving to reduce the cost of operating under the British flag, not to raise it, as this and, sadly, so many of its actions have tended to do.

Buy British
10.15 pm
Mr. Tony Marlow: I wish to raise with my hon. Friend the Minister a very important subject and to enlist his support and that of the Government. We must encourage people in this country, when they go shopping and buy their consumer goods, to think British. I do not suggest for one moment that people should buy goods just because they are British, but I do suggest that before people make their purchases they should look at what is on offer, and if British goods are as good as and cost the same as foreign goods, they should think before they buy and hopefully, they will make the decision to buy British.
Mr. Clinton Davis: Will the hon. Gentleman give way?
Mr. Marlow: I shall not give way, because there is not enough time. The hon. Gentleman has taken up enough parliamentary time already.
Mr. Davis: On a point of order, Mr. Deputy Speaker. The Minister sat down peremptorily following the previous debate, not having answered any of the points that were put to him.
Mr. John Prescott: I thought that the hon. Gentleman was giving way.
Mr. Davis: Should not the Minister have spent rather more time in dealing with a proper and serious debate and not displayed such a lack of courtesy?
Mr. Deputy Speaker (Mr. Ernest Armstrong): The hon. Gentleman knows that that is not a matter for the Chair.
Mr. Marlow: For some time many people in this country thought that it was clever and sophisticated to buy foreign goods. A radical, chic feeling had got around that foreign goods were somehow better than British goods. But during the past few years there has been almost a second industrial revolution in Britain, and although it may have been true that some British goods were not as good as foreign goods, and some British quality was not up to the standard of foreign competition, much has happened recently to reassure the British public. The latest cars produced by British Leyland—the Metro and the Maestro—are way above the quality and standard that we have come to expect from British Leyland, and well above the quality and standard of foreign competition. So the old idea that there was something clever and fancy about foreign goods is no longer the case. British is now best.
We all know the sad story of the housewife who comes back from her weekly shopping trip, parks her Spanish-assembled Fiesta in the drive and staggers in under the load of her shopping basket. It contains French apples, Dutch cheese, Irish butter and far eastern clothing. She puts it down beside her Italian washing machine, turns on her Japanese television set, wrings her hands in anguish at the sight of her unemployed son, and puts her head in her hands in despair at the thought of her husband being threatened with redundancy. All that she must do is to think. Why does she spend all this money on foreign manufactures and food when she could buy better stuff that is made in Britain?
All that the British consumer needs to do each week throughout the year is to spend 4 per cent. more on British

443
manufactures and consumer goods. By doing that we would increase the number of jobs in the United Kingdom by 350,000, which would have direct and indirect effects. It would reduce the burden of unemployment pay, increase the amount of earnings brought home by people, on which they would pay tax, and our good friend the Chancellor could allow us to keep £2·5 billion more of our money. By spending that money in Britain we would benefit our balance of payments to the extent of £900 million a year.
It is a fact that 82 per cent. of purchases are decided by the woman. I say this to my hon. Friend the Under-Secretary knowing what an attractive and glamorous man he is, because I am sure that he in particular will be able to persuade the women in this country to think British before they shop.
About 51 per cent. of toys and games for our children are imported. Why? What is the matter with British toys and games? About 45 per cent. of dry irons bought by the British housewife are imported. I understand that for a long time they came from eastern Europe, and there were unfair trading factors that should be taken into account. There were difficulties because goods from eastern Europe passed through West Germany, and as we are in the Common Market that caused difficulties. I ask my hon. Friend to address himself to those difficulties. About 71 per cent. of typewriters are imported and 55 per cent of footwear is imported. Again, there has been unfair competition. I know that my hon. Friend and the Government are tackling these problems as best they can, but we still have some way to go.
Some British companies have been helpful. Marks and Spencer has wherever possible worked the policy of buying from British manufacturers. In many lines, 80 per cent. and sometimes 90 per cent. of its goods are manufactured in the United Kingdom. Where it finds some difficulty in supplying goods that the consumer requires from United Kingdom manufacturers, it may initially purchase the goods overseas, but having done so it goes to the British manufacturer with the item in question and says "Look, can you make this?" If the British manufacturer can approach the price of the foreign competition, Marks and Spencer will do all that it can to get British goods into its stores rather than foreign goods, because it sees the virtues of the policies that I am putting forward.
I have already spoken about British Leyland. There were vast problems—both of industrial relations and of products. The problems of products have been overcome. The problems of industrial relations, despite the hiccups that we are having, are surely a thing of the past.
I should like my hon. Friend, with his right hon. Friends in the Government, to help in several particular aspects. First, I should like him to spread the message in the powerful way that he can, and the powerful way in which the Government have spread the message, to think British before buying. Second, I should like my hon. Friend to persuade his right hon. Friends to ensure that, wherever possible, when it comes to public purchasing policy by nationalised industries and Government Departments, we should persuade these bodies to think, and wherever possible to buy, British. I know that much is done at the moment, but the further we can move in this direction, where the quality and the price are as good, the more good we shall do for our own country. I know that
444
there are difficulties with EC regulations and GATT, but if we adopt the same processes as those adopted by the French we shall do ourselves a world of good.
Third, I think that we shall have to look carefully at our industrial policies, and I should like my hon. Friend to take this up with his right hon. Friends, when we are seeking to attract foreign investment into the United Kingdom. We must be very careful that we do not attract overseas competition to our manufacturers when we are doing a good job in a stable or shrinking market. Where we can supply our own market with our own manufactures, we do not want to be over-solicitous in bringing in foreign manufacturers. At the very least, we should have some sort of clearing house, so that before we give grants to any foreign manufacturer wanting to set up in this country we have a pretty clear picture of the industrial situation in that aspect of manufacturing, of where our producers are standing and of what they can do to improve their position. We should consider all that before we seduce somebody to set a plant in the United Kingdom.
Another aspect that I think is important is origin marking. I have said that so much footwear, so many dry irons and so many consumer durables come from foreign countries. There are many people, and I know many of my constituents, who would like to buy British goods. However, even with the changes introduced last year on origin marking, they sometimes find it difficult to know whether the goods were produced here or elsewhere. I know that the Minister's hon. Friend is looking at this problem, and I am sure that he will come forward with some positive proposals.
Another area of concern—I believe that the Government have a Green Paper in hand, and the sooner we see it the better—is the importation of counterfeit, substandard or dangerous goods. United Kingdom manufacturers are subject to all the regulations of the United Kingdom, as are factories operating in the United Kingdom. Our labour force is properly paid, properly supervised and works in a safe and secure environment. We do not know whether that happens overseas, nor do we know whether the overseas products are safe and secure. We must introduce a system to ensure that we do not have unfair and, more importantly, unsafe competition from overseas manufacturers.
I have made some important points, and I know that my hon. Friend is sympathetic. I conclude with one message: "Forget what you thought in the past. We need our own people to buy our own goods. We need the Government to help our people to identify our own goods. British goods may have been a music hall joke in the past, but they are not now. They are good and better. Our factories are more effective and efficient than they have been for many a year. Go out, do your shopping, look and think before you buy, and if you possibly can, buy British."
10.26 pm
The Under-Secretary of State for Trade (Mr. Iain Sproat): I congratulate my hon. Friend the Member for Northampton, North (Mr. Marlow) on his fast thinking and fast footwork in seizing the opportunity of the slacker-than-usual business in the House to bring this extremely important matter before us, even at this comparatively late hour. I also congratulate him on his splendidly patriotic speech. I hope that everyone, before purchasing any goods, will indeed think British and remember my hon. Friend's tale about those who never think British and are

445
surprised and appalled when they see the consequences of their actions multiplied many hundreds and thousands of times coming home to members of their families. I am glad that my hon. Friend took this opportunity to put forward his points in the way he did.
It is often asked, "Will not the Government give a stronger lead and perhaps mount their own campaign to persuade people to buy British wherever possible?" That was one of the implications of my hon. Friend's remarks. I confirm that it makes very good sense—the best sense—to buy British when British is best. I am glad that that is increasingly the case. As my right hon. Friend, the Prime Minister, recently said:
"Only the best is good enough for Britain's shoppers".
Wherever I, my hon. Friend the Minister for Consumer Affairs or my right hon. Friend the Secretary of State go, we encourage people to buy British.
My hon. Friend raised the important question of origin marking. The present regulations cover a wide range of goods and were introduced only last year. However, my hon. Friend the Minister for Consumer Affairs is at present reviewing these regulations with a view to extending their scope, and I know that he will take into account the strong views that my hon. Friend has expressed.
446
My hon. Friend also mentioned Marks and Spencer, which stocks more than 90 per cent. British goods. When mentioning that splendid example, people often ask, "Will the Government take measures to require other retailers to sell more British products?" We all wish that they would, but the Government will not require other retailers to act in this way because we firmly believe in an open market, and it would be wrong to dictate to the retailers. They must be left to decide what goods they stock.
I have already said that the Prime Minister rightly exhorts us all to buy British. It may well be asked "What are the Government doing to get the public sector to buy more British goods?" It is clear that the vast majority of public sector purchases are already met from 'United Kingdom sources as a result of the value for money they offer. For example, in 1981, Government Departments purchased 96 per cent. of the goods and services they required from British firms—
The Question having been proposed at 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.
Adjourned at half-past Ten o'clock.