Commons Sitting of 14 January 1985

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

    London Transport (Travel Passes)
    Mr. Greenwayasked the Secretary of State for Transport if will make a statement on the future of travel passes in London for pensioners, blind and disabled people.
    The Secretary of State for Transport (Mr. Nicholas Ridley): I understand that for 1985–86 the GLC has announced its intention to continue to fund concessionary travel for pensioners in London. Thereafter, the responsibility for pensioners' concessionary travel will rest with the boroughs, which will continue to fund concessions for the blind and disabled.
    Mr. Greenway: Will my right hon. Friend accept the congratulations of the blind, disabled and pensioners of London on guaranteeing their passes for the first time, which no Labour or Lib-Lab Government ever did or thought of doing?
    Will my right hon. Friend also consider asking London Regional Transport to allow homeless people to go on to underground stations during very cold weather, pending resolution of their tragic homelessness?
    Mr. Speaker: Order. That is somewhat wide of the original question.
    Mr. Ridley: On the first point, I am grateful to my hon. Friend. It would be helpful if the Association of London Authorities joined the current discussions to see how best to get a voluntary scheme among the boroughs for 1986–87.
    On the second point, I shall draw my hon. Friend's comments to the attention of London Regional Transport, if that is in order.
    Mr. Tony Banks: Can the Secretary of State give an assurance to pensioners that their passes will in no way be put in jeopardy by the mess that he has made over LRT's budget for next year and the excess £50 million that he demanded from the GLC in a manner described by Mr. Justice McNeill as
    "illegally, irrationally and procedurally improperly"?
    Can the right hon. Gentleman also tell us whether fares will have to go up 15 per cent, to cover his incompetence in organising a budget?
    Mr. Ridley: On the first point, the hon. Gentleman and the House know that a statutory back-up scheme for concessionary travel for pensioners in London is enshrined in the London Regional Transport Act. A threat to pensioners would arise only if the abolition Bill did not make speedy progress to the statute book.
    On the second point, the hon. Gentleman will know that we have appealed against the judgment, and therefore it is sub judice.
    Mr. Snape: Does the Secretary of State accept that he has no cause for self-congratulation? He accepted the amendment to include provision for concessionary fares in the LRT Bill most reluctantly. Following the question of my hon. Friend the Member for Newham, North-West (Mr. Banks), does the right hon. Gentleman consider that, as a result of the impact of the court's judgment on pensioners' and other concessionary fares in London, he owes the House an explanation, the GLC an apology and the ratepayers of Greater London £50 million?
    Mr. Ridley: The hon. Gentleman knows that it was to stop the scurrilous groundless rumours that concessionary fares were under threat—which were being peddled by the hon. Gentleman and his hon. Friends— that we

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    underwrote those fares in the Bill. I do not see why the hon. Gentleman is complaining about that now. That is what he wanted. I repeat that the other matter to which he referred is sub judice.

    Heavy Lorries
    Mr. Dykesasked the Secretary of State for Transport if he will make a statement on the progress of the development of the quieter heavy lorry.
    The Minister of State, Department of Transport (Mrs. Lynda Chalker): The quiet heavy vehicle project— QHV90— is making good progress. Most of the contracts have been placed with the industrial partners and I expect the programme to be substantially completed within the next four years.
    Mr. Dykes: I am grateful to my hon. Friend for that reply. Will she assure the House that the industry is not going slower than necessary on the development of the quieter heavy lorry, because that development was the essential quid pro quo for the approved increase in lorry weights? The development of the quieter heavy lorry is a better way forward than daft administrative bans in some areas, as currently proposed by the Greater London council.
    Mrs. Chalker: My hon. Friend is absolutely right; and I can give him the assurance that the project, costing about £10 million in total, is on target and proceeding well.
    Mr. Spearing: Does the Minister agree that the possible ban to which the hon. Member for Harrow, East (Mr. Dykes) referred would not apply to completely quiet lorries? Will she look into the figures quoted by the GLC? Is it not probable that such quietness could be achieved at even lower costs than have been considered so far? Will the Minister look into the matter immediately, notwithstanding the four-year programme that she has mentioned?
    Mrs. Chalker: The hon. Gentleman should not take comfort from the discussion that has gone on about hush kits, to which I think he is referring. Although I regret it, there is no range of hush kits ready and waiting to be fitted to the many different types of lorry in use today. The way to achieve the realistic and lasting reductions in lorry noise mentioned by my hon. Friend the Member for Harrow, East (Mr. Dykes) is by design, as is being done in the QHV90 project. We shall ensure that when the first prototype comes along, in good time, it is followed by others; and we shall start manufacturing at the earliest possible date to the QHV90 specification.

    Bus Bill
    Mr. Marlowasked the Secretary of State for Transport when he expects the Bus Bill will be presented.
    Mr. Ridley: Shortly, Sir.
    Mr. Marlow: Seeing that the bus's share of personal transport has fallen to a meagre quarter of what it was 30 years ago and yet the revenue subsidy spent on buses is some 50 times as great as it was 10 years ago, is it not clearly time that some radical change and solution were introduced? Is it not the case that anyone who looks at the situation objectively finds himself fundamentally behind the proposals in the White Paper?
    Mr. Ridley: My hon. Friend is quite right. I think that the subsidy is about 14 times greater, but otherwise I entirely agree with what he has said. In Northampton, the revenue support is 16 per cent, of the total cost of the bus operation. We believe that that money can be saved by increased efficiency or productivity, as has been demonstrated in many areas where competition has been tried. I believe that when the Bill is published, the policy before the House will lead to greater and better bus services and smaller subsidies, to the benefit of all concerned.
    Mr. Stephen Ross: We hope that the delay in publishing the Bill means that the Secretary of State is taking on board some of the more sensible representations that have been made to him by the Bus and Coach Council and by Hackney carriage proprietors, among many others. Is that so?
    Mr. Ridley: Many responses to the consultative documents have been received, and we have been careful to take all the good advice that they have included. I am sure that I can count on the hon. Gentleman to support the princples of competition and of putting the consumer first, which used to form one of the Liberal party's foremost platforms.
    Mr. Parris: Will my right hon. Friend attend not only to the chorus of vested interests that can be expected to be raised against such a change, but to the interests of those passengers who benefit from these changes but who do not yet know who they are?
    Mr. Ridley: We know that about 40 per cent, of the population depend on buses, and that is a very large clientele. I confirm that the proposals in the White Paper, and eventually in the Bill, are designed to assist and improve the lot of the passengers rather than of the operators.
    Mr. Roy Hughes: Is it not time that the Secretary of State realised that his proposals are causing great anxiety throughout the community? Does he appreciate that many of those with vast experience of the transport industry believe that deregulation is a receipe for disaster? Is it not time that he rethought the whole issue and entered into further discussions with the local authorities, trade unions and voluntary bodies, such as the National Federation of Women's Institutes.
    Mr. Ridley: If the hon. Gentleman has the interests of the passengers at heart, he should try to reassure them that the Government's proposals will not only increase the standard and frequency of services but also, we hope, reduce fares in many cases. He should be reassuring his constituents that the proposals are in their interests. He should not be listening so much to the operators.
    Mr. Robert Atkins: Does my right hon. Friend recognise that long delays in the introduction of the Bill will not help the future of Ley land Bus, in my constituency which manufactures the best buses in the world? Does my right hon. Friend recognise that an urgent introduction of the Bill, allowing for all the changes and considerations that might have to be made, is in the interests of the manufacturers as well as of potential passengers?
    Mr. Ridley: In view of my hon. Friend's urgent representation I shall alter my original answer from

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    "Shortly" to "Very shortly." I am fully aware of the problems of Leyland Bus. I have visited the factory. After an initial difficult period, I am sure that our policy, will result in more orders for the British bus industry, provided that it is competitive and supplies the market with what it wants.
    Mrs Dunwoody: Does the Secretary of State not understand that the elimination of cross-subsidy between routes will materially damage, above all, the people who live in rural areas? Since his White Paper said that the three trial areas had been failures, why is the right hon. Gentleman not prepared to accept that what he suggests is totally unworkable and irresponsible, and is aimed particulary at the people who cannot hit back—the bus passengers?
    Mr. Ridley: The hon. Lady has got it wrong again. If she studies the trial areas in Hereford and Worcester she will discover that the absence of cross-subsidy has resulted in a reduction in the subsidy, the same network being provided in the rural areas and with lower fares in many cases. What happened in Hereford and Worcester can be applied generally to the rural areas and so provide better bus services with greater frequencies and at less expense.

    Rural Bus Services
    Mr. Freemanasked the Secretary of State for Transport what specific definition of rural areas he proposes should be used for the purpose of transitional grant aid for bus services in such areas.
    The Parliamentary Under-Secretary of State for Transport (Mr. Michael Spicer): For the purpose of the rural bus grant we propose to define rural areas as being areas outside metropolitan counties and the larger towns as measured by data provided by the Office of Population Censuses and Surveys. We shall listen to the views of Members as to the size of small town which should qualify as rural.
    Mr. Freeman: I am grateful to my hon. Friend for that reply. On the assumption that the new levels of rate support grant will compensate the county councils for the loss of the revenue element of the transport supplementary grant, how will the £20 million of transitional aid in the first year to the rural areas be distributed so that the benefit goes to the rural areas?
    Mr. Spicer: The switch to capital only TSG will make no difference to revenue support, which will continue to be at the discretion of local authorities. The rural bus grant will be given through the fuel duty rebate mechanism. Operators will apply for the rural bus grant element on the basis of the services registered in rural areas.
    Mr. Haynes: Why does the Secretary of State keep saying that we shall receive a better bus service under the Bill? Does the Minister not realise the serious effect that the Bill will have upon rural areas? It is no good talking about the transitional period, because we are talking about regular periods afterwards, bearing in mind that bus services will be seriously reduced in rural areas, particularly in my constituency.
    Mr. Spicer: Rural bus services— indeed, all bus services—have declined in the last 10 years by over 25 per cent. The trial areas in which we have experimented show that we can stop the rot and increase the quality and number of buses.
    Mr. Adley: Is my hon. Friend aware that many of us applaud the theory behind the Bill, but have doubts about the practice? In the past few years in this place some of us have had experience of Governments who have had good ideas in theory but who have finished up a few years later wishing that they had done nothing of the sort.
    Does my hon. Friend recognise that the success in Hereford and Worcester was due largely to the enthusiasm and support of the county councils for the scheme? If he tries to bulldoze the proposals through in the face of hostility from county councils, he may well find a difficult situation. As the Bill has been delayed, will he please bear in mind that willing support should be a prerequisite to what he is trying to do?
    Mr. Spicer: Yes, Sir. I can confirm that the Association of County Councils has given the proposed Bill its support.

    Publicity Campaigns
    Mr. Hunterasked the Secretary of State for Transport what road safety or vehicle maintenance publicity campaigns are currently being conducted; and what is their cost.
    Mrs. Chalker: Our publicity programme for 1984–85 has an estimated cost of £3,953,000 and has included major campaigns on child pedestrian safety, cycling safety and drinking and driving. The programme for this financial year is now largely complete.
    Mr. Hunter: Bearing in mind the additional seasonal hazards facing motorists, which are likely to be with us for some weeks, will the Department consider intensifying publicity campaigns, with the aim of seeking a greater awareness of vehicle maintenance and safety among motorists when driving in ice and fog?
    Mrs. Chalker: I am grateful to my hon. Friend for that question. Of course, publicity on vehicle maintenance is important. We have brought out much publicity and always do so whenever new regulations are introduced. In hazardous weather motorists must be aware that they should go out only if it is really necessary. They should check their fuel, oil and anti-freeze and ensure that then-windscreens and lamps, both front and rear, are clean. However much hon. Members may charge me with being a nanny in that respect, I must say that those who do the sensible things on the road are more likely to be safe and here next week to tell the tale than those who ignore commonsense advice, which is what motoring in winter weather is all about.
    Mr. Stott: As the hon. Lady and I have an abiding interest in road safety, may I ask whether she or the Department has any views on the quality of road safety which is currently being afforded by Sir Clive Sinclair's latest invention, which I am given to believe is a bike?
    Mrs. Chalker: The hon. Gentleman is right to say that the C5 is a trike which falls completely within the electrically assisted pedal cycle regulations. I should make it clear that it is a bike in the sense that one has to pedal in it. There is no way in which it is a motor vehicle. We are obviously monitoring what is going on at the road research laboratory.
    Mr. Higgins: I welcome the recent poster campaign encouraging pedal cyclists to have lights on at night. Will

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    my hon. Friend recognise that the number of bicycles without lights is still appallingly high, and will she encourage the full enforcement of the law on those who risk their lives and other people's safety?
    Mrs. Chalker: I could not agree more with my right hon. Friend. Whenever we can we point that out, and I know that, whenever possible, police forces insist that cyclists obey the law and have properly lighted cycles. All cyclists put themselves in terrible jeopardy if their cycle lights are not in proper working order and if they are not dressed so that they can be clearly seen on the roadway at all times.

    Bus Deregulation
    Mr. Cowansasked the Secretary of State for Transport what recent representations he has received about the effect on rural bus services of bus deregulation.
    Mr. Parryasked the Secretary of State for Transport what recent representations he has received about his White Paper on buses.
    Mr. Gareth Wardellasked the Secretary of State for Transport what recent representations he has received about the buses White Paper and its effect on rural services.
    Mr. Ridley: I have received about 7,000 responses so far to the White Paper on buses and the consultation documents which were issued subsequently. A substantial proportion of the responses have speculated about the effects of the proposals on rural bus services.
    Mr. Cowans: I assume that the Minister has read all the representations and taken due consideration of them. I say that because when the Under-Secretary of State answered question 4 he led the House to believe that the Association of County Councils supported the White Paper on buses, yet when it gave evidence to the Select Committee its view was somewhat different. I do not know whether it has had a remarkable change of opinion in the past 48 hours.
    Assuming that the right hon. Gentleman does read the representations—I am sure that he does—does he realise that there is wide and growing concern, not only in the industry, but among passengers, that his proposals will decimate rural transport and isolate entire communities? Will he, even at this late stage, go back to the drawing board and return with some workable and realistic proposals which many within the industry and the passengers may find able to support?
    Mr. Ridley: I am surprised to hear the hon. Gentleman, so early in the day, prejudging the inquiry into these matters by the Select Committee of which he is Chairman. I have read the written representations of the Association of County Councils, which were broadly supportive of the proposals, though querying some of the detailed provisions. The hon. Gentleman would be mistaken to try to frighten rural passengers about these proposals. He may be interested to learn that in Hereford and Worcester 38 per cent, of the total revenue subsidy cost was saved, which would have been available had the county council wished to buy more rural services. Instead, it preferred to leave the present pattern of rural services and make the saving for the ratepayers.
    Mr. Maclean: Is my right hon. Friend aware that my constituents welcome the proposals because they realise
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    that rural bus services are practically non-existent and that our proposals are the only hope of increasing those that exist? Does he think it significant that in recent months the Liberal party in my constituency, which likes to believe that it is the champion of rural services, has been trying to hype up a campaign against the proposals but has had to abandon it because last weekend it found not one supporter?
    Mr. Ridley: My hon. Friend is the true voice in this House of rural dwellers, unlike the hon. Members for Tyne Bridge (Mr. Cowans), for Liverpool, Riverside (Mr. Parry) and for Gower (Mr. Wardell), who have asked the question. I agree that nobody can be satisfied with the present position of rural services and that the radical plan that the Government are putting forward to provide more and better services should be supported, even by hon. Members who represent urban constituencies.
    Mr. Cartwright: In view of the support which expert bodies, such as the Bus and Coach Council, have given to the idea of introducing competition through the franchising of bus routes rather than having a free-for-all on the roads, may we be told whether the changes that the Secretary of State has made to his original proposals embrace that kind of approach?
    Mr. Ridley: I do not believe that franchising would achieve anything like the scale of benefits that the proposals in the White Paper for full competition will bring, for two reasons. The first is that county councils would, under the franchising proposals, use their judgment as to what was the right pattern of supply to meet the market, rather than allow the market to determine the pattern of supply of services. The second is that once a franchise was obtained it would be protected from competition, and that would have the effect of not allowing the full benefit from increased productivity and reduced costs, which we believe will come from allowing full competition, to be developed.
    Mr. Canavan: Will the Secretary of State confirm reports that he has had to delay publication of the Bill because of strong opposition from Members of Parliament, including some Tory Members who represent rural areas? Is the right hon. Gentleman aware that unless he wants to see public transport reduced to a mere skeleton service run by cowboys, he will have to scrap the Bill completely in view of the devastating effect that it will have on bus services, particularly in rural areas, and on jobs in the coach-building industry; for example at Walter Alexanders in my constituency?
    Mr. Ridley: There has been an enormous number of representations and it has been important to take great care to design the detailed provisions of the Bill to facilitate the transitional period leading to the deregulated regime. That is why we are running slightly late. However, the hon. Gentleman will be pleasantly surprised by how soon the Bill will be in the Vote Office. If he has the interests of his rural passenger constituents at heart, I look forward to him joining my right hon. and hon. Friends in voting to support the proposals that are set out in the Bill.
    Mr. Pike: Does the Secretary of State accept that while a small minority might have better services as a result of the Government's proposals, the cost will have to be paid for by those living in rural areas? Those living in rural areas and those who are dependent on off-peak services

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    and Sunday services, and the elderly and the disabled. About 3,000 of my constituents have written to me on this issue, as they are concerned about the Government's proposals. They hope that the Government will decide to withdraw them.
    Mr. Ridley: Those who are paying the high levels of cross subsidy are those living in the cities, especially those in the hon. Gentleman's constituency. They live on bus routes on which there are many passengers. They are being taxed, as it were, to subsidise those who live in leafy suburbs in rural areas. As a Socialist, which I assume the hon. Gentleman to be, is he satisfied with that pattern of cross subsidy?
    Mr. Beith: Does the Secretary of State realise that in Northumberland there will be commercial pressure for the operators to compete for the routes on the fringes of Tyneside, leaving local authorities with insufficient moneys to provide revenue subsidies to the operators, who are left to make an attempt to provide a service for the large and thinly populated rural areas?
    Mr. Ridley: The hon. Gentleman knows that I am not a stranger to Northumberland. I can confirm that the bus service in rural Northumberland leaves a great deal to be desired. I believe he will find that a greater service is able to be provided for the same amount of money by receiving tenders for rural routes.
    Mrs. Dunwoody: Will the Secretary of State make it clear that in areas such as Hertfordshire the cutting of a £1 million subsidy will result in the county spending £2·4 million on replacing school buses alone? Why does he not have the honesty to say that in the trial areas, expecially in Hereford, a number of buses were so dangerous that they had to be taken off the roads? It will be the passengers who will pay for the mad Bill that the Government propose.
    Mr. Ridley: The hon. Lady has it wrong, again. I think that she read an article about Hertfordshire and the transport supplementary grant. That had nothing to do with the bus Bill. Secondly, the percentage of buses passing initial inspection in 1983–84 was as follows: National Bus Company vehicles 60 per cent., private bus operators' vehicles 56 per cent., passenger transport executive operators' vehicles 49 per cent., and London Transport vehicles 47 per cent. That shows that the private sector has an extremely good safety record.

    Dial-a-Ride Service
    Mr. Tom Coxasked the Secretary of State for Transport if he will list the London borough councils with whom he has discussed the future of the dial-a-ride service; and if he will make a statement.
    Mrs. Chalker: We are in full discussion with the London Boroughs Association. We have also made contact with the Association of London Authorities, but we are still awaiting its response to our invitation to join the discussions.
    Mr. Cox: Is the Minister fully aware of the increasing concern of the disabled and the organisations that represent them about the uncertainty of the future of the service? As the service is now being developed in London, it is the Government's duty to put some pressure on authorities such as the borough of Wandsworth, which will not make
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    any commitment. It seems that the hon. Lady cannot be aware of the concern and could not care less whether the service continues or dies. It is up to the Government to help the disabled now that the service is in being.
    Mrs. Chalker: It is my firm intention that the scheme shall be determined by the London boroughs, which are talking with us, and that includes Wandsworth. As a resident in that borough, I at least have some say in what goes on within it. The only doubt that is being put in the minds of the disabled about the dial-a-ride scheme is coming from those who are campaigning against the Government's policy. It is they who are worrying the disabled. I can assure the disabled that we are discussing the future of the dial-a-ride scheme. We recognise the importance of it, and the purpose of the talks is to find the best way of continuing to meet the need. I hope that the hon. Gentleman will desist from scaremongering, if that is what he has been doing.
    Mr. Eggar: Is not the way in which the GLC is spending ratepayers' money and stirring up concern among disabled people completely disgraceful? Is my hon. Friend convinced that the way in which the GLC spends money on this scheme provides the best value for money for disabled people?
    Mrs. Chalker: I am sad to say that the GLC is not spending money in the best possible way. What we have been doing with the London branch of the national advisory unit for community transport to make its schemes develop in the most effective and efficient manner is the best way in which we can help not only to maintain the dial-a-ride system but to provide other systems to enable disabled people to get around. I shall continue to ensure that that happens, whatever the GLC does.
    Mr. Meadowcroft: Is the Minister aware that one reason why the disability organisations wish to have a better relationship with London Regional Transport is that they do not necessarily consider themselves to be clients of social services and, therefore, within the purview of the London boroughs? Does the hon. Lady accept, therefore, that it is desperately important that people who rely on dial-a-ride should be able to look forward to that kind of relationship with LRT?
    Mrs. Chalker: The hon. Gentleman's statement bears out the steps that LRT is taking with the new heads of its unit and one of its board members, who is directly responsible for the transport of disabled people in London. A number of the organisations for the disabled have already told me that they are pleased with the steps that LRT is taking through that unit to help disabled people to use conventional and new forms of transport in the future.
    Mr. Snape: Does the Minister accept that if the Department of Transport returns to the GLC the ?50 million that the Department improperly filched from it, due to the incompetence of the Secretary of State, much more money will be available for the dial-a-ride scheme and other schemes? That is a fact, and not scaremongering.
    Will you confirm, Mr. Speaker, that the purpose of the sub judice rule is to protect juries from being improperly influenced and that the rule has no relevance to a civil case, when a judge hearing an appeal is specifically precluded from referring to Hansard? It is about time that

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    Ministers, especially those in the Department of Transport, were responsible for their actions and stopped hiding behind their own cowardice.
    Mr. Speaker: The sub judice rule would apply to civil cases.
    Mrs. Chalker: Thank you, Mr. Speaker. I shall be guided by you. One of the problems of the dial-a-ride scheme—[Interruption.] If the hon. Member for West Bromwich, East (Mr. Snape) would listen, I might be able to give him an answer to his question. The point about the dial-a-ride scheme is that we must effectively serve the needs of disabled people. Their needs can be best identified by those who are closest to them at local level. We are seeking to obtain the best value for money so that dial-a-ride can best help those who cannot get on conventional transport, and we shall continue to do that.
    Mr. Snape: On a point of order, Mr. Speaker. Will you accept a point of order?
    Mr. Speaker: Order. Not now. I shall hear points of order later.
    Later:—
    Mr. Snape: On a point of order, Mr. Speaker. During an earlier exchange I referred to the judgment by the court last Friday that the Secretary of State for Transport had acted
    "unlawfully, irrationally and procedurally improperly"
    in taking from the Greater London Council the sum of £50 million to fund London Regional Transport. The Secretary of State's reply during that exchange was that the matter was sub judice.
    First, my information is that by lunchtime today no official notice of appeal had been received by the court. Is the matter sub judice because the Secretary of State says so or because of some action taken by the Department of Transport?
    Secondly, I understand that any press inquiries about the original court case made to the Department of Transport over the weekend were deflected by that Department on the ground that the matter was sub judice.
    Thirdly, is it fair or proper for Ministers to hide behind the sub judice rule, when the purpose of that rule is to prevent the improper influencing of members of the jury rather than to prevent a judge from reaching a decision on the merits of a case?
    If the House is not allowed to call Ministers to account, there is little purpose in Question Time or in asking Secretaries of State to come before the House.
    Mr. Ridley rose—
    Mr. Speaker: Order. Before the Secretary of State answers, perhaps I could clarify the issue. The resolution of the House on 23 July 1963 makes it clear that matters awaiting or under adjudication in a civil court should not be referred to in any question to a Minister, including supplementary questions, and this rule applies during the period when notice of appeal is given and until that notice of appeal has been decided. I am not aware whether the notice of appeal has been given.
    Mr. Ridley: Further to that point of order, Mr. Speaker. We have given notice to the court of intention to appeal. That is not the same as formal notice of appeal, but, as far as I am concerned—I am not talking about Opposition Members—it would clearly be improper for
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    me to respond in any way on the substance of the matters about which we have given notice to appeal. Perhaps I should not have used the phrase "sub judice", but that is why I refused to comment on the points of substance.
    Mr. Snape: Further to that point of order, Mr. Speaker. May I ask you to give us a ruling as to when the sub judice rule applies? Does it apply when a Minister says that his Department intends, at some unspecified time, to appeal against a judgment with which he disagrees and as a result of which he has been found to be acting
    "unlawfully, irrationally and procedurally improperly"
    or does it come into effect when a physical application is made to a court that the original judgment be set aside?
    Mr. Speaker: As I understand it, the matter is sub judice when a formal notice of appeal has been given.
    Mr. Snape: Then, further to that point of order, Mr. Speaker, surely the Secretary of State is accountable for his actions and should have replied to the questions put to him during Question Time. As, in my limited experience, this situation is unprecedented, I ask you to allow an extension of Question Time so that the Secretary of State can be held to account for those unlawful, irrational and procedurally improper actions of which he has been found guilty by a court. When one reflects on the odium that the Government have poured on elected members of the GLC because of their attempts to run public passenger transport in London, it makes one feel that it is grossly improper to allow the Secretary of State to get away with hiding behind a sub judice rule which, as you have just ruled, does not exist.
    Mr. Speaker: Order. The House knows that I am not responsible for answers or supplementary answers from the Front Bench. I cannot help the hon. Gentleman.
    Mr. Tony Banks: Further to that point of order, Mr. Speaker.
    Mr. Speaker: Order. I think that we have exhausted this subject.
    Mr. Banks rose—
    Mr. Speaker: Order. I have already said that I cannot help the hon. Gentleman. I cannot allow an extension of Question Time. We have a busy day ahead of us.
    Mr. Snape: Further to that point of order.
    Mr. Speaker: Order. I cannot help the hon. Gentleman.
    Mr. Snape: I have a different question.
    Mr. Speaker: Well, ask it.
    Mr. Snape: Further to that point of order, Mr. Speaker. I do not get any pleasure from doing this at this time of the day. However, you ruled that if a matter was sub judice the Secretary of State could not be expected to reply to questions on it. We have just heard that the matter is not sub judice, but the Secretary of State is still refusing to answer the question. I appreciate that you cannot tell the Secretary of State when or whether to answer a question in the House. However, I hope you will agree that it is a gross abuse of the proceedings of the House for the Secretary of State to claim something that is false. I am not allowed, by the rules of the House, to say that the Secretary of State was telling lies, but I am bound to say that I would have great difficulty in finding any other way

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    to describe his conduct this afternoon. I am asking you, Mr. Speaker, as the protector of the rights of all hon. Members, both Front and Back-Bench Members, to give a specific ruling that the Secretary of State is wrong and to call him to account and ask him what he is prepared to do about it.
    Mr. Speaker: Order. I have given a factual ruling. I cannot go any further. The Secretary of State is responsible for what he says in answer to a question. He can answer it, but he need not do so, and that is a matter for him.
    Mr. Ridley: Perhaps I might help. It is for you to rule, Mr. Speaker, whether a matter is sub judice. I made it clear during Question Time, and I repeat it now, that, as I have given notice of my intention to appeal, I shall not reply to questions that would prejudice that appeal when it comes on. That does not apply to the hon. Member for West Bromwich, East (Mr. Snape), but it does apply to me.
    Mr. Tony Banks: Further to that point of order, Mr. Speaker. Will you give us your guidance on another point? Although you cannot require the Secretary of State to say anything specific about this matter, will you ensure that in both the Local Government Bill Committee tomorrow and in the rate support grant debate on Wednesday—because this judgment has an impact on the proceedings on both those measures—no one will be banned from saying something on the ground that the matter is sub judice, when it is clearly not sub judice?
    Mr. Speaker: Order. The sub judice rule would not apply to legislation anyway, so the matter is open to the hon. Gentleman.

    British Rail (Ancillary Services)
    Mr. Traceyasked the Secretary of State for Transport what plans he has to discuss with the chairman of British Rail progress on contracting out ancillary services on the railways.
    Mr. Ridley: It has long been British Rail's policy to procure its supplies through competition. I am glad to say that the board has now decided to extend competition to the provision of support services. It has drawn up criteria to establish this competition on fair and equal terms and I will arrange to put copies of the criteria in the library.
    Mr. Tracey: I am grateful to my right hon. Friend for that answer. I should like to concentrate the attention of my right hon. Friend and the chairman of British Rail on catering services on British Rail trains and stations. I believe that they will find a considerable appetite for change among the public.
    Mr. Ridley: My hon. Friend is right. So far, hardly any catering on the trains, and not all that much on the stations, is let out to competitive tender. The new criteria, which I urge my hon. Friend to study when he obtains his copy from the Library, will give the private sector the rules of the game, showing how the private sector may apply to British Rail to be allowed to bid for contracts to carry out catering—I hope to the general gastronomic satisfaction of all rail passengers.

    British Railways Board
    Mr. Ron Lewisasked the Secretary of State for Transport how many meetings he has had with the chairman of the British Railways Board since 1 October; and what subjects were discussed.
    The Parliamentary Under-Secretary of State for Transport (Mr. David Mitchell): My right hon. Friend and I have had four meetings with the chairman since 1 October last. We have discussed a wide range of subjects of mutual interest, including investment.
    Mr. Lewis: At the meetings with the chairman of the board, did the Minister and his superiors discuss the question of safety on British Railways? Is the hon. Gentleman aware that in the railway fraternity today there are some misgivings about the lack of maintenance of the old vehicles that are now running? Is he further aware that many trains are running late mainly because of a lack of normal maintenance procedures? At his next meeting with British Rail will he bring that matter up? Is he further aware that today on British Rail men and women work more overtime than is normal? Would it not be better to pay them a decent rate of pay and to employ more people?
    Mr. Mitchell: The level of maintenance of rolling stock is a matter for British Rail management, and I shall draw the hon. Gentleman's point to the attention of the chairman. British Rail has embarked on a major programme of investment in new rolling stock. I have today written to Bob Reid, the chairman, approving investment in 240 medium-weight sprinter DMUs at a cost of about £60 million.

  ATTORNEY-GENERAL

    Conspiracy and Protection of Property Act 1875
    Mr. Alex Carlileasked the Attorney-General how many persons were prosecuted in the Crown court in 1982, 1983 and 1984, respectively, for offences contrary to section 7 of the Conspiracy and Protection of Property Act 1875.
    The Attorney-General (Sir Michael Havers): Offences under this section are purely summary and not justiciable in the first instance in the Crown court. Proceedings under this section are ordinarily instituted by the police and not by the Director. One prosecution was commenced in 1982, and two in 1983. Equivalent figures for 1984 are not yet available, but since 13 March 1984 275 people have been charged under this section.
    Mr. Carlile: First, I am grateful to the Attorney-General for his correction about the mode of trial, which I accept. Does he agree that there is an urgent need for an early review of public order offences? Does he further agree that the revival of a previously disused public order offence specifically for the purpose of charging pickets in the miners' strike is liable to exacerbate already difficult circumstances unnecessarily?
    The Attorney-General: The Home Secretary is conducting a review of the public order aspects of the law. The offence covered by section 7, of which the hon. and learned Gentleman disapproves, is not one which should or could be outside the criminal law. The value of a law is not measured in inverse proportion to the length of time

    15
    it has been enacted. There are three grades of unlawful assembly, for example, which the Law Commission recommended, of which the hon. and learned Gentleman is no doubt aware. Those matters are being considered by the Home Secretary, who, I hope, will be able to deal with them shortly.
    Mr. Gerald Howarth: Is my right hon. and learned Friend aware that this piece of legislation came into effect precisely to deal with the sort of intimidation that we are seeing at the moment? Can he assure me that he has had consultations with chief constables about obtaining evidence from working miners to the effect that the National Union of Mineworkers' leadership is organising a conspiracy? Will he take this opportunity to encourage working miners to come forward with further evidence, which will enable the conviction of the ringleaders to take place so that my constituents, who, even today, are visiting me because they cannot get to work without suffering from intimidation, can get justice?
    The Attorney-General: It is not for me to have conferences with chief constables. That would be a matter, if appropriate, for the Home Secretary. It is true that there is a dearth of evidence that would be necessary if, for example, the Director of Public Prosecutions were seeking to initiate proceedings for conspiracy under section 7. He would need to have evidence which, at the moment, is not available. I have no doubt that the chief constables are carrying out their duties properly. I would welcome any working miner who has evidence of an offence under section 7 making that evidence available to the police.
    Mr. Nicholas Brown: Surely the hon. and learned Member for Montgomery (Mr. Carlile) has the better point here. The use of the legislation in recent times has concerned solely industrial disputes. There is a real fear and danger that it will be seen as partisan, and that respect for law and order will be undermined for a considerable period in communities where such a law is used.
    The Attorney-General: I congratulate the hon. Member on his appointment to the Opposition Front Bench. I hope that he will enjoy it.
    The 1875 Act was designed exactly for this sort of industrial dispute. I cannot imagine occasions on which it would be used other than in the course of industrial disputes. As I said in answer to the hon. and learned Member for Montgomery (Mr. Carlile), I cannot believe that the criminal law could be effective without at least having the section 7 offence or one similar to it.

    Price Waterhouse (Sequestration)
    Mr. Adleyasked the Attorney-General what recent discussions he has had with Price Waterhouse about sequestration; and if he will make a statement.
    The Attorney-General: I have not had any discussions with Price Waterhouse since my statement to the House on 11 December. I have nothing to add to what I told the House in that statement.
    Mr. Adley: Is my right hon. and learned Friend aware that the National Union of Mineworkers and its Labour party allies are doing their best to put about the story that it is the Government who are somehow instigating the legal actions? Therefore, will the Attorney-General—and his right hon. and hon. Friends on the Front Bench and
    16
    in the Government—take every opportunity to remind the public that this is not the case, and that the actions are being brought by working miners who feel that Mr. Scargill and his colleagues are purloining the union funds in a disgraceful and illegal way, in the light of the fact that there has been no ballot?
    The Attorney-General: My hon. Friend is right. Last Friday there were three different actions before the High Court, in each of which the plaintiffs were working miners, some from south Wales and some from other mining areas.
    The sequestration—and the order and the indemnity that I gave arising from it—was not for the benefit of the plaintiffs. It arose simply from a breach of an order of the court that amounted to contempt of court. In my role as guardian of the public interest I thought it necessary that I act to avoid the real risk that the order of the court could be flouted.
    Mr. Skinner: Is the Attorney-General aware that he can try as hard as he likes to suggest that the Government are not involved in the court cases, but that when the public realise that the working miners' committee has been advised by two people who have served their apprenticeships at No. 10 under the Prime Minister, and take into account all the other people who have been assisting in the legal battles of working miners, they will be bound to come to the conclusion that the Government are heavily involved in the court actions? The Government are in it up to the neck, with a view to trying to smash the NUM, but they will not succeed. The Government see it as a prelude to smashing the whole of the TUC.
    The Attorney-General: I am not sure whether it would be possible for a miner Member of Parliament to pay a greater insult to fellow miners than to say that they are acting under the advice and guidance of the Tory party. It is simply not true.

    Latent Damage
    Mr. Chapmanasked the Attorney-General when he expects to conclude consultations following publication of the 24th report of Lord Chancellor's Law Reform Committee on latent damage.
    The Solicitor-General (Sir Patrick Mayhew):The Lord Chancellor's Department has asked for any comments on the Law Reform Committee's report to be sent to it by the end of March.
    Mr. Chapman: If it is my right hon. and learned Friend's intention to introduce legislation in this Session of Parliament, he will know that amendment and clarification of the law, particularly relating to latent defects in buildings, is urgently required by all those involved in the process of construction, not least by the owners and occupiers of buildings.
    The Solicitor-General: The Lord Chancellor is well aware of the importance that is attached by many people, in the professions for which my hon. Friend speaks, to the contents of the report and to the subject generally. The Lord Chancellor is, however, equally determined to ensure that the public have an opportunity to comment upon the recommendations of the report. He has asked for those comments by the end of March. It is very important that any legislation should not be found to suffer from a latent

    17
    defect. Therefore, I am afraid that the Lord Chancellor cannot give the undertaking for which my hon. Friend asks.

    Price Waterhouse (Sequestration)
    Mr. Winnickasked the Attorney-General if any public funds have yet been paid to Price Waterhouse in regard to its role as sequestrators of the National Union of Mineworkers' funds.
    The Attorney-General: No public funds have been paid to the sequestrators.
    Mr. Winnick: Will the Attorney-General bear in mind that all the points made originally by the Opposition when the Government's decision became known remain justified, and that the amount of bias in the decision of the Government, who are acting in a way totally different from the way in which they have acted in any other circumstance, shows only too clearly that the right hon. and learned Gentleman should think about the matter again?
    The Attorney-General: I ask the hon. Gentleman to read again the short speech, much interrupted, by my hon. and learned Friend the Solicitor-General when he wound up the debate on 19 December.
    Mr. Spencer: Does my right hon. and learned Friend agree that there is a need for the High Court to have a permanent fund available to it for use in sequestration proceedings? Will he discuss with the Lord Chancellor how such a permanent fund might be set up?
    The Attorney-General: Certainly, that is one of the matters that has arisen as a result of this quite exceptional action, which is without any precedent, as everybody knows. No doubt I shall have the opportunity to discuss it with the Lord Chancellor.

  OVERSEAS DEVELOPMENT

    Aid (Asia)
    Mr. Proctorasked the Secretary of State for Foreign and Commonwealth Affairs what proportion of the overseas aid budget goes to Commonwealth countries in Asia; and if he will make a statement.
    The Minister for Overseas Development (Mr. Timothy Raison): In 1983 some £187 million, amounting to 32 per cent. of British bilateral aid, went to Commonwealth countries in Asia. Over that period £125 million, or some 30 per cent., of our multilateral aid contributions went to the same countries.
    Mr. Proctor: Does my right hon. Friend agree that the real shortage in those countries is of entrepreneurs? What part does the aid budget play in the creation of more entrepreneurs in those countries?
    Mr. Raison: I do not think that it is as true of the Asian countries as it is of the African countries that there is a grave shortage of entrepreneurs. On the other hand, in one way or another, the aid programme provides scope for entrepreneurs, and we stress the importance of countries reducing their excessive overdependence on parastatals, which characterises so many of them at present.

    Nicaragua
    Mr. Dubsasked the Secretary of State for Foreign and Commonwealth Affairs if he will consider increasing aid to Nicaragua.
    Mr. Raison: Her Majesty's Government have no plans to increase the level of their bilateral aid. Nicaragua does, however, benefit substantially from the European Community's aid programme.
    Mr. Dubs: Is the Minister aware that Britain's bilateral aid currently stands at around £25,000 a year and that that sum seems to be very trivial in relation to the needs of the country? May I ask the Minister to reconsider increasing aid to Nicaragua, because if he does not do so many people will think that his motives are political spite rather than a realisation of the needs of the people of Nicaragua?
    Mr. Raison: The fact of the matter is that Nicaragua is by no means the poorest of the countries in central America, and is not among the poorest 50 countries as defined by the World Bank. Our intention is to concentrate our aid as far as possible on the poorest countries, and Nicaragua does not fall into that category.
    Mr. Meadowcroft: Does the Minister accept that, apart from humanitarian considerations, the recent history of liberation movements and other such organisations in Africa shows that if we in the West do not give aid to Nicaragua or countries like it, it is almost inevitable that such countries will be put into the hands of the Communist bloc, which will certainly aid them?
    Mr. Raison: I can only repeat that it is not possible for the United Kingdom to undertake substantial aid programmes to every country in the world. We have our priorities, and of course countries with historic connections rate high in our priorities, by and large. Nicaragua is not one of the poorest countries.

    Ethiopia
    Mr. Stuart Hollandasked the Secretary of State for Foreign and Commonwealth Affairs whether he has called on the Ethiopian Government to negotiate safe passage with the liberation fronts in Eritrea and Tigre to ensure the distribution of food aid to those areas.
    Mr. Raison: It would not be realistic or appropriate to expect the Ethiopian Government to negotiate with rebel movements in ways that might involve recognition of their claims. We have asked the Ethiopian Government on several occasions to ensure that food and other relief supplies reach all areas of the country. For some areas that is carried out most effectively by the voluntary agencies.
    Mr. Holland: Surely the Minister is aware that the situation in key food distribution areas such as Makale is getting worse, not better, and that dozens of children are dying each day in such distribution centres, as many British people saw last week on television. The Minister has been to Makale and knows the problem there. The Government do not control the surrounding areas—the drought areas. Why is it inappropriate for the right hon. Gentleman to bring pressure on the Government? If he does not do so, or does not get the Council of Ministers of the EC to do so, there will be tens of thousands of needless deaths in the days and months to come.
    Mr. Raison: With our partners we are now providing substantial quantities of food aid to Ethiopia, and that is

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    as it should be. We make sure that the food reaches the area around Makale. It is difficult—we do not deny it for one minute—to see that it is distributed to all those who come under the rebels' authority. On the other hand, substantial numbers of people are moving in from the rebel-held areas to Makale to get food there.
    Sir John Biggs-Davison: With regard to my right hon. Friend's original answer, will he deny that the Royal Air Force is to be withdrawn from helping in Ethiopia?
    Mr. Raison: We have not yet made a decision about that. The RAF has done enormously valuable work. We have to consider what is the best use of our resources.

    Falkland Islands
    Mr. Dalyellasked the Secretary of State for Foreign and Commonwealth Affairs what is (a) the total cost of the Brewster housing project in the Falklands, (b) how many Brewster houses are occupied and unoccupied, respectively, and (c) what are the categories of occupiers of the Brewster houses.
    Mr. Raison: The final cost of the project will not be known until details of local expenditure on site services and infrastructure and other related claims have been submitted. At present, 33 houses are occupied and the breakdown of occupants is as follows: 13 islanders, 13 personnel on contract to the Falkland Islands Government, three immigrants and four diplomatic service and Ministry of Defence personnel. The Falkland Islands Government estimate that the remaining 21 houses should be occupied by the end of this month.
    Mr. Dalyell: Is the cost above or below £100,000 per house, and does the Minister regard that as value for money?
    Mr. Raison: It is above £100,000 per house, but it must be remembered that that includes the cost of transporting materials there, the preparation of the sites, provision of water, electricity and so on. The Falkland Islands Government have also acquired ownership of other assets such as plant, equipment and an accommodation block as part of that process.
    Mr. Spearing: Does the Minister recall that the Select Committee on Foreign and Commonwealth Affairs was dissatisfied with the arrangements made by his Department for tendering for those projects and their subsequent administration? Will he consider that report and ensure that in any future emergency of this kind much better and clearer arrangements are made?
    Mr. Raison: I have studied the report, although it relates to events that took place before I took up my present post. I accept that we must consider carefully what can be learnt from this episode, but I do not accept that the whole thing has been a waste of time and money.

    Ethiopia
    Mr. Teddy Taylorasked the Secretary of State for Foreign and Commonwealth Affairs whether the additional quantities of food being provided for Ethiopia by the Common Market will be from additional resources or from reducing aid to other countries.
    Mr. Raison: The cost of the 1·2 million tonnes of grain pledged by the European Council on 4 December for
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    African countries affected by drought will be met by transfers from other parts of the Community budget not related to aid, from the unallocated emergency provision of the European development fund and from the 1985 Community food aid programme. In addition, member states will make available directly more than one third of the total amount. The British share of those actions will be met from the public expenditure provision for overseas aid.
    Mr. Taylor: Is it not highly disturbing that the total amount of food that the Common Market plans to send to Ethiopia next year is less than the amount sent every six weeks to the Soviet Union? What justification can there be for anyone going without food in Ethiopia when such unmanageable surpluses are being sent to the Soviet Union at vast expense to the British taxpayer?
    Mr. Raison: My hon. Friend should realise that the quantity of aid pledged by the Community to Ethiopia and other parts of Africa is very substantial. He should also realise that the sending of Common Market grain surpluses is not a matter of giving something away free. It involves substantial costs—about £250 per tonne of grain transported and delivered in Ethiopia. The equation is thus more complicated than my hon. Friend suggests.

    International Planned Parenthood Federation
    Mr. Deakinsasked the Secretary of State for Foreign and Commonwealth Affairs what amount the United Kingdom will contribute to the International Planned Parenthood Federation in 1985–86.
    Mr. Raison: We have agreed to contribute £3·75 million to the International Planned Parenthood Federation in 1985.
    Mr. Deakins: The Minister must be aware of the total withdrawal of funding to the IPPF next year by the United States. Will he bear that shortfall in mind, as the IPPF contributes to many valuable programmes in the developing world and it would be appalling if that work had to be substantially reduced?
    Mr. Raison: I am aware of the cut in support from the United States, but the £3·75 million to which I have referred is an increase from £3 million in 1984, so I believe that we are doing our bit.

    Turks and Caicos Islands (Airport)
    Mr. Spearingasked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement concerning the closure of the new airport at Providenciales in the Turks and Caicos Islands.
    Mr. Raison: The airport was closed to scheduled jet services from 29 November to 19 December while maintenance work was undertaken on the runway. It is now open and operating normally.
    Mr. Spearing: Does the Minister recall that another report of the Foreign Affairs Select Committee expressed dissatisfaction with his Ministry's arrangements for the construction of the runway? Will he assure the House that he will investigate the events of that time and the effect that they may or may not have had on the closure of that controversial airport?
    Mr. Raison: I do not believe that the events of that time had any effect on the recent developments. I am advised that it is not unusual for such cracks to appear. The runway is now operating successfully and so, I believe, will the Club Med project.

Sterling (Exchange Rate)
3.38 pm
Mr. Roy Hattersleyasked the Chancellor of the Exchequer if he will make a statement on the sterling exchange rate and the prospects for interest rates in Great Britain.
The Chancellor of the Exchequer (Mr. Nigel Lawson): Movements of the exchange rates on the markets over the past few days have been fully reported.
As my predecessor made clear to the House on a previous occasion, successive Governments have made it their practice not to make statements about the level of the exchange rate; and like him I do not intend to depart from that practice.
So far as interest rates are concerned, the Bank of England announced this morning that its minimum rate for lending to the discount market would be 12 per cent. This demonstrates the Government's resolve to maintain sound monetary conditions and to take whatever steps are necessary to ensure continued success in the battle against inflation.
Mr. Hattersley: Does the Chancellor of the Exchequer recognise that today's events demonstrate that the Government's economic policy is a shambles, and that its inadequacy has been emphasised by his incompetence and vacillation during the past week? Will he confirm that interest rates now stand at the figure which the Government inherited in 1979? We have had public spending cuts, and unemployment has been pushed up to record levels, but the central objective of lower interest rates has not been achieved.
Secondly, what, if anything, is the Chancellor's exchange rate policy? Will the pound soon be left once more to market forces, or is today's open intervention an admission that his supine inactivity during the past fortnight has contributed to today's crisis and will result in a certain increase in mortgage rates during the next 14 days? Will he have the grace to admit that a policy which he repeated and confirmed only a week ago—leaving interest rates to be determined solely by market forces—has been abandoned, in disaster for the economy and in humiliation for the Chancellor of the Exchequer?
Mr. Lawson: I note, as the House will have noted, that the right hon. Gentleman described the level of interest rates that we inherited from his Government as a shambles. The objective of Government policy is to reduce inflation, to hold it down and to reduce it still further. We have succeeded in doing that, but the Labour Government failed conspicuously to do it, despite the fact that, on several occasions, the right hon. Gentleman declared that to be the central objective of their policy.
As to open intervention, I should remind the right hon. Gentleman that, when the new arrangements for monetary control were published on 5 August 1981 in a Treasury press notice, the relevant section read as follows:
"The Bank will cease to post a continuous Minimum Lending Rate from 20 August, as this would be inconsistent with the objective of the new arrangements to give the market more influence over the structure of interest rates. The option"—
[Interruption.] Hon. Members should be patient. I continue:
"The option will, however, be retained for use in some circumstances of announcing in advance the minimum rate which for a short period ahead the Bank would apply to any lending to the market."
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That is precisely what happened today. It was my decision on the advice of the Governor of the Bank of England.
Finally, I should say that several factors have been at play here, one of which is uncertainty about oil prices. Another is the sharp rise of the dollar against other currencies. A third factor has been doubts about the Government's resolve to persist with their counter-inflationary policy in the light of the continued pleas for still higher public borrowing and expenditure. The Government's decision today demonstrates that those siren voices cannot be listened to if inflation is to be brought under control. That is the purpose of our action.
Mr. Terence Higgins: Is it not essential to consider recent events in an international context? Does my right hon. Friend agree that the high rate of the dollar has been a fundamental aspect of the problem? Given that that is so, will he make renewed representations to the United States Administration on the need to reduce the American deficit and interest rates?
Mr. Lawson: My right hon. Friend is right. That is the view not only of him, myself and the Government, but of most European Governments. As my right hon. Friend is aware, I shall be flying to Washington the day after tomorrow— [Laughter]— for a discussion with the American Treasury Secretary and other finance Ministers. These matters will be very much under discussion.
Mr. Richard Wainwright: To avoid further damage, will the Chancellor try to reverse the clear impression that he has given to foreign exchange operators in recent weeks that he has been relying on the weakness of the pound against the dollar in respect of our North sea oil earnings in order to make partisan measures in his forthcoming Budget? Will he make it clear at last that he has no intention of using adventitious and possibly short-term exchange positions to make long-term Budget decisions?
Mr. Lawson: I have given no indications of the kind that the hon. Gentleman is referring to.
Mr. David Howell: As the main influences on sterling— the strong dollar and the oil price— are largely outside the Government's control, and as the outlook for inflation is very good, can we assume that the hike in interests rates will be relatively short-lived? Would the situation be rather smoother in the future if we now joined the European monetary system as a full member?
Mr. Lawson: On my right hon. Friend's first question, interest rates will obviously remain at this level for no longer than is necessary to secure proper monetary control, proper monetary conditions and a continuation of our success against inflation. They will have to continue just as long as is necessary to achieve that.
The question of full membership of the European monetary system is continually under review, but that is a financial discipline of its own kind, which requires the use of interest rates whenever necessary to maintain a particular parity.
Mr. Robert Sheldon: Why is it that, three years after abandoning minimum lending rate, the Chancellor is returning to it? Is it because a clear signal was required that the Government have an interest rate and exchange rate policy? Does not that show up the irrelevance of the Government's money supply policies?
Mr. Lawson: Not at all. As I showed with my quotation from the press notice issued when the new arrangements were set in place in 1981, this was deliberately retained for use in circumstances where it was necessary for a clear signal to be given of the Government's policy and resolve. That has been given. We will return immediately to arrangements that do not involve the posting of a particular minimum lending rate.
Mr. Peter Hordern: Since the new level of interest rates must, at least in part, reflect the expansion of credit on the broad measurement, does my right hon. Friend still think it appropriate that there should be £1·5 billion available for the reduction of taxation in the Budget?
Mr. Lawson: I have as yet no reason to depart from the indication that I gave at the time of the autumn statement in November, hut, of course, I shall be reviewing it, as I said at the time, before the Budget and it would be very unwise to assume that that amount of tax reductions can necessarily be given. But these matters will have to be reviewed at the time of the Budget and I think that there is no point in speculating about that now.
Mr. J. Enoch Powell: Does the Chancellor of the Exchequer agree that, provided that the Government can fund their borrowing requirement and meet their sight liabilities, which are their first obligation, nothing but benefit can accrue to the economy and to the unemployed from the prospect of a fall in oil prices and the associated fall in the exchange rate of sterling?
Mr. Lawson rose—
Hon. Members: In theory, yes.
Mr. Lawson: I have always understood that it was part of the right hon. Gentleman's credo not to express particular views about the desirability of particular price levels for any particular commodities—that goes for oil as well. I believe that disruptive movements in either direction are harmful to the world economy and to the United Kingdom economy.
Mr. Nigel Forman: Do not the events of the past few days show that it was always possible and right for the Government to take account of movements in exchange rates in deciding their financial policy, but that, equally, it is not sensible to isolate one target as the benchmark, be it the public sector borrowing requirement, the exchange rate or any other shibboleth?
Mr. Lawson: My hon. Friend is correct, in the sense that a number of indicators of monetary conditions have to be used in assessing the conditions appropriate for a continued decline in inflation and a continued economic recovery of the kind that we are enjoying and will continue to enjoy. Indeed, that recovery compares far better against the performance of the rest of the world, and particularly of the rest of the countries of the European Community, than was the case when the Labour Government were in office.
Mr. Alfred Morris: What does the Chancellor expect the effect of these higher interest rates to be on the level of unemployment?
Mr. Lawson: The one thing that would really cause a sharp increase in the level of unemployment would be a resurgence of inflation, which is precisely what would
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follow from the policies advocated by Opposition Members and which is precisely what we are determined not to indulge in.
Mr. John Townend: What influence has the miners' strike had on the recent fall in the value of sterling? Does not my right hon. Friend agree that there are underlying factors that justify a higher level of sterling, such as a balance of payments surplus and a low rate of inflation?
Mr. Lawson: As the House knows, one of the problems that we face is that public borrowing this year is running ahead of what we had planned, partly because of the cost of the coal strike but partly for other reasons. But this only reinforces our resolve to keep public expenditure firmly under control. With regard to my hon. Friend's second question, there are indeed several very positive factors, and such fluctuations in the market place do tend to be excessive from time to time.
Mr. Anthony Beaumont-Dark: Does my right hon. Friend accept that most of us would agree that he was quite right not to throw reserves at the sterling rate, a practice which proved so disastrous in 1973–74? Bearing that in mind, does he accept that some of us are disappointed at this departure from the free market economy and free market exchange workings? If my right hon. Friend is right, and this is meant to be only a short-term move in interest rates, will he—as we have already made a dent in the free market— ask the building societies not to take any precipitate action to increase the cost of house borrowing for at least a month?
Mr. Lawson: Of course, the level of mortgage rates is a matter for the building societies and not for me, but I am sure that they will have heard what my hon. Friend has said.
Mr. Ian Wrigglesworth: Is not the truth of the matter that the panic measures that the Government have had to take today are a direct consequence of the complacency and contradictory statements that we have heard in recent times from Government Departments? Can the Chancellor explain why, in recent days, different briefings have emanated from No. 10 Downing street and the Treasury? Will he confirm that his statement and the action taken by his Department today is supported by the Prime Minister?
Mr. Lawson: Of course, the measure that I have announced today is part of a policy that is the policy of the entire Government. I have read some of the stories that have appeared in the newspapers with both amazement and dismay, but I do not think that this is the first time that Governments have had that experience when reading newspaper stories.
Mr. Patrick McNair-Wilson: May I warmly congratulate my right hon. Friend on his firm action today? A strong and internationally respected currency is an essential weapon in the fight against inflation. However, as oil prices are a significant factor in achieving that goal, will he ensure that the British National Oil Corporation does not take unilateral action which could affect prices so that it could be regarded as an unfriendly act by other producers and so lead to an oil price war?
Mr. Lawson: I am grateful to my hon. Friend for his opening remarks. The second part of his question is not

27
strictly speaking a matter for me. But it is the Government's policy— which has been pursued for many years and which was, I believe, held by the previous Government—that United Kingdom oil prices should be in line with the market and that there should not be artificial prices. Nevertheless, I think that BNOC realises that it has a duty to conduct its day-to-day policy in a way that causes as little political or economic disruption as possible.
Mr. Gordon Brown: Will the Chancellor stop blaming everyone but himself? Does he not recall that on 29 July 1980 the Prime Minister told the House that the pound was high and strengthening, because
"investors overseas believe that our economic policies are right, that they will succeed, and that under a Tory Government Britain is worth investing in."—[Official Report, 29 July 1980; Vol. 989, c. 1305.]
Now that the pound is half as high, what does the Chancellor think is the markets' verdict on his Government's economic failure?
Mr. Lawson: If we are going to talk about quotations, I was interested to read—[HON. MEMBERS: "Answer the question."] I have already answered the question. As the House knows well, there are basically three factors affecting the exchange rate at the present time. There is the oil price weakening, the strength of the dollar against all currencies, not just against sterling, and the doubts about whether monetary conditions are fully consistent with a lower rate of inflation and, indeed, whether public expenditure may not be running excessively high. I emphasise the last point in particular. There is no way in which we can consistently be getting inflation down with scope for increases in public expenditure or increases in public borrowing. I think that that must be fully understood.
I have a quotation from the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) at the Aneurin Bevan lecture on 13 October 1984—about three months ago. He said:
"Of course, we need an exchange rate which encourages exports rather than assists imports. And some adjustment in the value of sterling may therefore be necessary—at least against the weighted average of currencies."
As there has been a reduction since then of 6 per cent., is that adjustment bigger or smaller than the adjustment that he sought?
Mr. Robert McCrindle: Is it not about time that we told our American allies that their continued failure to deal with the strength of the dollar is an unfriendly act which makes a mockery of economic interdependence? Will the Chancellor give an undertaking to the House that when he meets the new American
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Secretary of the Treasury later this week he will underline the fact that that feeling is widespread in the British Parliament?
Mr. Lawson: I am grateful to my hon. Friend. Certainly, I think that I shall be underlining, as others will underline, the need for the United States to take measures to reduce its budget deficit.
Mr. Gordon Wilson: If, as is manifest, the pound has slumped against the dollar partly because of a mild softening in world oil prices, what steps does the Chancellor intend to take in the longer-term to deal with the crisis which is already on the horizon— that declining oil production will reveal to the world the disastrous state of the United Kingdom balance of payments?
Mr. Lawson: Oil production in this country is going to be very substantial for many years to come. I think that it is foolish of the hon. Member for Dundee, East (Mr. Wilson) to assume that it will suddenly disappear. It will be a major factor in our economy for many years to come.
Mr. Roger Freeman: Is my right hon. Friend aware that on this side of the House his move is seen as both inevitable and correct? When my right hon. Friend goes to the United States in two days time, will he draw the attention of Mr. Baker, the new Secretary of the Treasury, to the fact that it is in the best interests of the United States itself that the inevitable continuing rise of the dollar is halted, so that international trade, particularly between western Europe and the United States, is carried out on a more even keel?
Mr. Lawson: Sooner or later, I believe, the value of the dollar in the foreign exchange markets will decline, but it is impossible to say when that will occur. One of the problems about much of the criticism from Opposition Members is that they find it impossible to understand the nature of the markets and the fact that we have to conduct our policies within a context of markets which are often wayward and unpredictable.
Several Hon. Members rose—
Mr. Speaker: Order. I remind the House that this is a private notice question and an extension of Question Time. There is an important debate tomorrow on the reduction of unemployment through public investment. Although the motion is not yet on the Order Paper, I have no doubt that hon. Members will be able to allude to this matter in that debate.

Sterling (Exchange Rate)

  WELSH AFFAIRS
  Ordered,
  That the matter of Regional Policy as it affects Wales, being a matter relating exclusively to Wales, be referred to the Welsh Grand Committee for its consideration.—[Mr. Biffen.]

Orders of the Day

  Trustee Savings Banks Bill
  Order for Second Reading read.
  4 pm
  The Economic Secretary to the Treasury (Mr. Ian Stewart): I beg to move, That the Bill be now read a Second time.
  May I begin by drawing the attention of the House to the White Paper—[Interruption.]
  Mr. Speaker: Order. Will those hon. Members who are not remaining for the debate please leave the Chamber quietly?
  Mr. Stewart: May I draw to the attention of the House the White Paper which was published on 18 December 1984, which sets out the proposals for reorganising the trustee savings banks? That White Paper, which is the background to this Second Reading debate, contains a background to and history of the trustee savings bank movement and to the legislative arrangements which have applied to the trustee savings banks over many years. It also sets out the recent developments in the trustee savings banks leading up to the Bill and the further proposals which are described in the White Paper in the form of a letter from Sir John Read, the chairman of the central board of the trustee savings banks. That describes in particular the elements of the proposals which are not contained in the Bill.
  Other documents which hon. Members may find relevant to the subject are available in the Library. They are the Treasury press notice of 18 December, a press notice of the same date by the trustee savings banks central board, the TSB group report for 1983, and the draft memorandum and articles of association of the TSB Group plc, as it is intended to be. That last item is optional reading, even for enthusiasts.
  Mr. Jim Craigen: There is usually a period after the publication of a White Paper when the public have time to digest its contents. Is it not a bit of an irrelevance to publish a White Paper when the Bill is introduced so quickly thereafter? Has the pushing forward of the Bill anything to do with the difficulties that the Government are running into over the privatisation of British Airways?
  Mr. Stewart: The Government published the White Paper on the same day to explain the background to the Bill and to set out the matters that I have just described. I should have thought that that would have been helpful not only to hon. Members but also to those outside who take an interest in the proposals. The proposals themselves have been known in general outline for a couple of years or more. It is convenient for the House to have before it the way in which the Bill is formulated and the other matters which Sir John Read describes, and the White Paper fulfils that function.
  The Bill deals with only those parts of the proposals which are the responsibility of Government. The trustee savings banks themselves are primarily responsible for the arrangements about their own future. In particular, they have direct and immediate responsibility for the reorganisation for the companies and bodies within the
  30
  group to which the Bill refers. The production of the Bill and the bringing forward of the proposals is the consequence of a long period of discussion, including close consultation between the Government and the trustee savings banks.
  The second paragraph of Sir John Read's letter in the White Paper says:
  "I confirm that you have the full support of the TSB Group in promoting this Bill. In August 1982, after lengthy and very careful consideration of the options, both by the Treasury and within the TSB Group, I announced that the TSB Group wished to reorganise into a Companies Act structure and to acquire additional capital and a wide pattern of ownership by issuing shares to the public. As the main purpose of the Bill is to permit the TSBs to take these steps, we naturally welcome it."
  As I said when the Bill was published, I am glad that it has proved possible to introduce it into Parliament during this Session. That enables us to complete the statutory arrangements for enabling Trustee savings banks to obtain full private sector status without delay. I am anxious that they should be in a position to realise their potential and to play a full part in the development of the banking sector. That will increase competition and consumer choice in retail banking at an important stage in the evolution of financial markets.
  Mr. Gordon Wilson: The Minister will be well aware of the report of the Monopolies and Mergers Commission on the Royal Bank of Scotland which sets out the desirability of the Scottish banking sector being retained with its full integrity and autonomy. As I read the Bill and the White Paper, the autonomous trustee savings banks in Scotland will be subsumed into a new company, the TSB Group, which will have overall authority. The TSB in Scotland has had a much larger and more important role to play than the TSB in England and Wales, as I think the Minister will agree. As a result, we shall see the bank disappearing and the overall effect will be a diminution in the Scottish investment sector and the control of investment operations within Scotland. Would not that be a bad thing, given the overweening centralisation of the British economy and financial sector in London?
  Mr. Stewart: Under the existing structure with the central board, there is already a good deal of centralisation and co-operation between the individual trustee savings banks. As I understand it, there is unlikely to be any diminution of that after the reorganisation. The structural changes are needed for other reasons. If the hon. Gentleman is worried about that point, I hope that he will consult the trustee savings banks.
  I visited the TSB in Scotland a few months ago and I was impressed by what I saw. In no sense did I get the feeling that the Scottish indentity or the bank's independence was thought to be in any sort of jeopardy as a result of the proposals. I certainly do not believe that to be the case. Indeed, the savings bank movement originated, like many good things in the financial sector, in Scotland. I recognise that after reorganisation the TSB will want and need to retain a substantial measure of its identity. But the proposals that we are considering today are the culmination of a process in which the trustee savings banks themselves have recognised that more cooperation and communication between them is needed. Therefore, it is partly their own banking needs which have led to the present proposals.
  Mr. Wilson: The Minister gave an assurance that there would be no diminution in the level of centralisation

  31
  compared with the previous structure, which I did not entirely welcome and which was not exactly what I had in mind in seeking that assurance. Does he recognise that there is a difference between co-operation, which can be desirable, especially in the confederal arrangement which existed before, and one company, one integrated shareholding, where the majority of the shareholders throughout the United Kingdom will have the right to take investment decisions which could result in the dismantling of the trustee savings banks in Scotland in five to 20 years' time as a result of a change of policy?
  Therefore, will he consider building into the Bill something along the lines of that which has been given to the TSB in the Channel Islands, where there is to be a separate shareholding which will safeguard some of the autonomy of the TSB there? It is important that there should be something in the Bill to safeguard the Scottish situation.
  Mr. Stewart: I hesitate to be drawn into a long debate on that question at this stage. I shall be interested to hear what the hon. Gentleman says in his speech. Having listened carefully to his intervention, I think it might be helpful if I covered the remaining aspects with which I wish to deal, and, by leave, I shall reply at the end of the debate to the points that hon. Members make.
  This legislation will also pave the way for the ownership of the TSBs to be established in the hands of the shareholders of the new group, with priority for those who, as depositors and staff, have contributed to the success of the TSBs. I welcome the opportunity that this will provide for spreading share ownership more widely and, in particular, for enabling those who have been involved in the business of the TSBs as customers and employees to invest directly in their future.
  The Bill will enable the TSBs to reorganise on to the same basis as the major banks with which they compete in the high streets. The Bill is required to transfer the business of the existing TSBs into the new bodies being set up under the Companies Act framework and to make provision for a number of other specific aspects of the transition. I shall comment shortly on the provisions of the Bill.
  Many of the proposals for the future of the TSB group do not require legislation. These are the responsibility of the TSBs and their central board, though the Government have been involved in the discussion of the overall strategy. The hon. Member for Dundee, East (Mr. Wilson), may be aware that on a number of aspects of these proposals it is for the TSBs, rather than for me, to respond.
  I do not propose to give, and I cannot give, assurances about the internal arrangements of the TSB group. However, I can emphasise that the arrangements which are permitted by the Bill and which the Bill empowers the TSBs to carry through have been discussed between the TSBs and the Government and are agreed by the management of the TSBs to be in the TSB interest.
  Sir John Osborn: While welcoming the Bill and my hon. Friend's remarks, may I ask if he is aware that some of us with an interest in the TSB and small banks generally believe that one of their great assets is that they have brought in the small saver? Has my hon. Friend had an assurance that the strong
  32
  character of the TSB will continue, bearing in mind that it will be competing with building societies and other banks?
  Mr. Stewart: I recognise the contribution which my hon. Friend and many other hon. Members have made to the TSB movement and the interest which they take in it. I share his concern that the TSBs should maintain their provision for the small saver and their local connections, and everything that I have heard in the discussions leading up to the introduction of the Bill convinces me that that is still the intention and purpose of those concerned with the TSBs, and I welcome that fact.
  As soon as the proposed reorganisation is complete, the new TSB banking companies will apply for authorisation under the Banking Act, and the special arrangements for the supervision of the TSBs by the Treasury and other provisions in the Trustee Savings Banks Act which at present apply to the TSBs will come to an end. The new TSB banking companies will then have the same legal status as any Companies Act company and will be subject to the same legal and prudential requirements as other major banks in the United Kingdom.
  It will be clear that the Bill is a technical document. Clause 1 sets out the definitions on which the rest of the Bill is based. The existing TSB group consists of the four existing trustee savings banks, the TSB central board and the subsidiary companies which they already own through Trustee Savings Banks (Holdings) Ltd., which is described as "the existing holding company."
  The new TSB group will consist of the new holding company, in which shares are to be issued to the public, and its subsidiaries— that is, the new TSB banking companies and the specialist companies, which are identified in this context in the family trees on page 7 of the White Paper. The new holding company will be called TSB Group plc, although the Bill does not refer to it by name.
  Mr. Craigen: As the term "trustee" has a particular meaning, are we to take it that the bank will be "TSB" and will not be "Trustee Savings bank"?
  Mr. Stewart: The hon. Gentleman was good enough to give me notice that he would raise that question. The last page of the White Paper contains a reference to that in paragraph 13 by Sir John Read:
  "We intend for continuity purposes to retain 'Trustee Savings Bank' in the full legal title of the new banking subsidiaries."
  I understand that there is no objection to the use of that word in this context, although it is a matter for the Department of Trade and Industry in relation to company names. I gather that there is no difficulty in the use of the word or in the use of the word "trust", which is frequently used in banking matters and for companies of that kind.
  Clause 2 deals with the central board established by the Trustee Savings Banks Act 1976, on the Standing Committee on which I served. The central board will need to undertake a wide range of operations during the reorganisation and is therefore given additional powers as necessary for that purpose. Once the reorganisation is complete, the central board becomes redundant; therefore the Treasury is given power to bring the existence of the central board to an end.
  Clause 3 is the central provision. It vests the business of the various bodies which comprise the existing TSB group into the appropriate parts of the new TSB group.

  33
  The central board holds a number of assets, liabilities and obligations, and these will be transferred to the new group holding company. The Bill transfers the business of each of the existing TSBs to the appropriate new banking company which is to replace it. Each of these companies will be a subsidiary of the holding company. The clause makes it clear that contracts of employment are not affected, so that employees will enjoy exactly the same terms of employment after the reorganisation as before.
  Clause 4 deals with the running down and eventual dissolution of the existing TSBs, which will be no more than shells once their business has been transferred to the new TSB banking companies. It provides for the trustees to vacate office once any outstanding accounts have been drawn up, and empowers the Treasury to dissolve the TSBs by order. The Trustee Savings Bank Act 1981, which consolidated earlier legislation, will also become redundant. The Treasury is empowered to repeal that Act by order, subject to transitional and saving provisions as appropriate.
  Clause 5, with schedule 2, contains a number of tax provisions the purpose of which is to ensure that the TSBs do not suffer adverse tax consequences in the reorganisation which would not have applied in a reorganisation involving bodies all of which came under the Companies Act.
  Clause 6 follows the tradition of earlier TSB legislation in providing for the remaining members of a class of savings bank which was established under an Act of 1819 dealing with savings banks in Scotland. These banks are not trustee savings banks, although up to now they could convert into TSB status if they wished. At present there are two such banks, one of which has announced its intention to merge with a major Scottish commercial bank at the end of this month. When the Bill is enacted, these provisions will therefore apply to the one remaining member of the class, the Airdrie savings bank, which has a number of branches in the Glasgow area.
  The effect of this clause, with schedule 3, is to rectify an error in the Banking Act 1979, an Act prepared by a Labour Government, though I accept that the omission was inadvertent. The Banking Act was drawn up in terms which precluded the 1819 savings banks from seeking authorisation from the Bank of England to take deposits.
  Mr. Robert Sheldon: Apart from a reference to the Monopolies and Mergers Commission, what is to prevent another clearing bank from taking over the TSB?
  Mr. Stewart: In the immediate future, the structure prevents that. As the right hon. Gentleman will know from the White Paper and from information provided by the TSB, it is the intention, after the Bill is enacted, to issue shares which would be in the ownership of the TSBs in future. It is intended also—this is a matter for the TSB movement rather than for the Government—that for the first rive years after it has become a private sector group there should be a limit on a shareholding by any one shareholder of 5 per cent. of the capital, and thereafter a limit of 15 per cent. It will be many years hence before the issue will arise whether the TSBs might be taken over by any other group.
  Dr. Oonagh McDonald: The Minister has stated the position as it is set out in the memorandum that accompanies the White Paper and the Bill, but that is not
  34
  written into the Bill. The Bill does not lay down any provisions that would prevent a takeover of the sort that my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) has postulated.
  Mr. Stewart: The hon. Lady is right to say that the Bill does not contain any such provisions. We are dealing with the intentions of the TSBs, and I think it proper that they should deal with their own affairs without the involvement of the Government.
  Apart from dealing with the commencement and repeals in the usual way, clause 7 provides that the Bill will have direct effect on the Channel Islands and the Isle of Man. The island authorities involved have agreed that it is in everyone's interest that the reorganisation should proceed on the same basis and at the same time throughout the British Isles, even though in a number of respects the Bill contains matters which would normally be the subject of separate legislation on the islands, or at least an extension to the islands at the option of the local legislatures. I thank the island authorities for agreeing to this procedure. I readily acknowledge that the special circumstances which follow the pattern of earlier TSB Acts do not constitute a precedent detrimental to the constitutional position of the islands.
  I shall mention briefly one or two matters that have been raised in public discussion of these proposals since their introduction. After a long and distinguished history as banks encouraging thrift and savings but with few other functions, the TSBs found it increasingly difficult to compete in the market place during the 1950s, 1960s and 1970s. The committee which was established in 1971 under Sir Harry Page was invited to consider the future of the TSBs and it recommended the development of their banking services. That was followed by the 1976 Act, which was introduced by the then Labour Government. That measure created the central board and permitted the TSBs to undertake new activities.
  Mr. Robert Sheldon: The Page report suggested that there should be a third force. The first force consisted of the clearers and the second of the National Giro. The third force was the trustee savings banks, which would look after the local community and concentrate on small savers. I reaffirmed that from the same position which the hon. Gentleman now occupies. What has changed since then? What has happened to the third force?
  Mr. Stewart: The third force can take different shapes at different times. The trustee savings banks were enabled by the Labour Government of which the right hon. Gentleman was a member—this process is being taken further forward by the present Administration— to develop in the way they thought best in their own interests.
  The background and the financial markets have changed a great deal since the early 1970s and so have the services that are expected by customers of different types of banks. Sir John Read comments in his letter to the Chancellor of the Exchequer in the White Paper:
  "The TSB group today is radically different from the TSB movement of ten years ago and has shown that it is fully capable of competing with other financial institutions in a fast-changing environment."
  The way in which the TSB movement has been able to adapt itself and to develop its business is impressive. At the same time, it has retained many of the important traditional characteristics of a movement that concentrated on small savers and local communities.
  Mr. Craigen: How will the introduction of shareholders looking for dividends help the average customer of the TSB?
  Mr. Stewart: The proposed public issue of shares will complete the transition of the TSBs to a fully-fledged status in the private sector. That will assist all those who have anything to do with the movement by giving them access to capital markets and the accountability which presently is lacking. The public issue will be made possible by the Bill, but that will not be a matter for the Government. Dividend policy and future profitability will be matters for the TSBs. Surely a body of interested shareholders, particularly one that includes depositors and the staff, which will have priority when the issue is made— I hope that members of the staff will take up the shares on a substantial scale— will be the best way of ensuring an identity of interests between depositors and the staff of the banks which has been the strength of the movement in the past.
  Sir Geoffrey Finsberg: Does my hon. Friend agree that the important point, which was missed by the interventions of the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) and the hon. Member for Glasgow, Maryhill (Mr. Craigen), is that the TSB movement comprises local people in almost every town and village in the country, and that their initiative has led to the Bill's introduction? They are the people who want it and they are the depositors. That is why things have changed from 1971. As the Chairman of the Public Accounts Committee— the right hon. Member for Ashton-under-Lyne— will recall, I was a strong supporter of the Page report when I was an occupant of the Opposition Benches. However, things have moved on since then, and so has the TSB movement.
  Mr. Stewart: My hon. Friend has summed up the position extremely well. I emphasise yet again that the Government are introducing a Bill that enables the TSBs to do what they want to do. Surely that should be welcomed on both sides of the House. The TSBs have made a great deal of progress in the past 10 or 15 years. Indeed, they have made good progress since the 1976 Act, which was another helpful stage in their development. I compliment Sir John Read and the members of the central board, the management and the staff of the TSBs centrally and at individual banks on the way in which they have responded to the challenge of major changes and on the progress which the movement has made since its legislative basis was altered a few years ago.
  An issue which has been raised on many occasions is the ownership of the trustee savings banks. It has been said that the Bill is a privatisation measure but it is not what is generally understood to be a privatisation measure, which is a disposal by the Government. The Government do not own the TSBs. The money raised by the share issue will go to the banks and enable them to develop for the future. In that respect, the Bill is fundamentally different from privatisation measures. I suppose that it is a privatisation measure in the sense that it takes the TSBs into full and orthodox private sector status, but it takes them from a form of no man's land in which ownership is not established and not from the public sector.
  The TSBs are not owned by their employees or depositors. Nor are they owned by the trustees or the
  36
  Government. Unlike building societies, they have no shareholders. Ownership is one of the issues which it is incumbent on a Government and Parliament to resolve.
  Sir John Osborn: Can the TSBs handle this without the backing of legislation to limit shareholding to 5 per cent. in the early years and 15 per cent. later? To what extent will those shares be freely exchangeable? In about 10 years' time, will I as a member of the public be able to buy some shares or will there be severe restrictions? How will this be handled?
  Mr. Stewart: I hope that my hon. Friend can buy shares at any time in the future after the issue takes place. I do not know how substantial my hon. Friend's resources are, but if he wished to buy more than 15 per cent. of the TSB group he might find some obstacles in his way. Provisions for dealing with this aspect will be incorporated in the memorandum and articles of the company. The provisions will operate in that sense and not by legislation. They will, of course, be subject to the ordinary provisions of company law.
  The Bill is designed to end the statutory relationship of the TSBs in a special position with Government and Parliament. The Government and Parliament are responsible for resolving the questions of ownership, supervision and taxation involved in the reorganisation, the repeal of earlier legislation, and so on. The TSBs will have the responsibility for carrying out the changes. The Bill and the proposed reorganisation that will follow mark the end of an era. The trustee savings banks will cease to have a unique and an anomalous— in today's world— form of constitution. This Bill will, therefore, be the last in a long line of Bills dealing with the trustee savings banks.
  I am glad that the Bill removes many of the restrictions on the TSBs' freedom of action which have constrained their progress. I am sure that the proposals we are putting to Parliament are in the interests not only of the TSBs but of their customers and their employees, and I hope that the proposals will be warmly welcomed. The TSB movement has a long history and a distinguished past. I am convinced that the TSBs have an important future. The Bill will enable them to take advantage of new opportunities, and I commend the legislation to the House.
  4.32 pm
  Dr. Oonagh McDonald: The Economic Secretary has rightly said that the Bill is designed to end a series of changes in the trustee savings bank movement. The changes began in a serious way with the Page report, which was commissioned in 1971 and produced in 1973. The report led to the first Bill which, in 1976, radically changed the operations of the TSB.
  The Economic Secretary rightly said that the trustee savings bank movement had had a long and distinguished history. The first savings bank was set up in 1810 in Ruthwell in Dumfriesshire. That bank and others of its kind were designed to encourage thrift among working class people. Some of the branches seemed to have an interesting history. One of the early branches formed in Edinburgh was brought into being by a local branch of the Society for the Suppression of Beggars. Those who set up the banks frequently expressed strong moral feelings. S. W. Nicholl in his "Summary View of Report and Evidence Relating to the Poorhouse 1818" said:
  "In every new disciple of the Savings Bank I see at least two apostates from the Poor Rate and in 15 or 20 years there is no

  37
  reason to doubt that the inherent and progressive principle of the Savings Bank will have not only stopped the progress but will have entirely routed the influence of its antagonist the Parish Rate."
  In the eyes of some of their instigators, the trustee banks were designed to encourage the poor not just to save but to save so that they would not be a burden on the rates. In some ways, one can see an early form of Thatcherism in the minds of some of those who were responsible for setting up the trustee savings bank movement. I do not mean to suggest that that was the only motive for setting up the banks; other people with philanthropic motives wanted to assist people in obtaining access to savings and the benefits that they could bring.
  The banks have already changed considerably. Some of those changes might make the early founders turn in their graves. There are 2 million credit card holders among the 6 million customers, and that is some distance from the early notion of encouraging thrift. The changes in 1976 allowed the TSBs to operate full banking functions, including the ability to make loans to depositors, although those loans were restricted to members of the ordinary public and corporate loans were not encouraged. Since then, TSBs have developed deposit and credit services, cheque, savings and investment accounts and fixed term bonds. The TSB group offers insurance services and unit trusts through the TSB trust company. The TSBs operate credit cards, and the United Dominions Trust Ltd is an instalment credit and leasing company. Mortgage facilities have already become available.
  As the Economic Secretary rightly pointed out, the further changes envisaged in the Bill do not amount to a privatisation measure. If this were a privatisation measure, the Opposition's attitude would differ. The Government do not own the trustee savings banks and, in spite of the doubts about the ownership, will not benefit from the proceeds of this sale. The Government's inevitable involvement is due to the history of the bank because it is under the supervision of the Treasury. The bank will now be transferred to the supervision of the Bank of England under the Banking Act 1979.
  The questions dealt with by the Economic Secretary and in the White Paper make some of the issues a little clearer. The Page report referred to the ownership question. I understand that the members of the Page committee thought of raising that question when they were part of the way through their examination of the national savings movement. The Chief Registrar of Friendly Societies was asked to comment on who owned the bank.
  In paragraph 250 of the Page report he admitted that the statutory framework for the trustee savings bank
  "left the true relationship between the depositor and his bank unclear. The wording of the Trustee Savings Banks Act 1969 indicated that the depositors were creditors of the bank, and therefore entitled, if the bank were wound up, to be repaid the full amount of their deposits plus the interest due. …On the other hand the Act, in providing for the use of trustees, did not make at all clear the extent to which, if any, the relationship between a depositor and a bank was also that of beneficiary and trustee."
  The Page report then comments that if the banks are to be considered as mutual organisations without shareholders, the right interpretation would be for depositors to be entitled to the full value of the bank, which would almost certainly be more than the liability to repay deposits and accrued interest, unless there had been gross mismanagement.
  38
  Therefore, it is clear from the Page report that the chief registrar and members of the committee inclined towards the view that the depositors were the owners. Although this is denied in the White Paper in paragraph 4.02, the Government must either accept the principle that ownership lies with the depositors or, at least, strongly suspect that that might be the case. If ownership did not lie with the depositors, the Treasury would be only too glad to get its hands on the proceeds of the sale and to rush the sale through to ensure that there is money for tax cuts in the coming financial year.
  The Economic Secretary glossed over the problems about ownership. In his reply he should make it clear, given the remarks in the Page report and the fact that the Treasury is not taking the proceeds of the sale, how the Government arrived at the view expressed in the White Paper that ownership plainly did not lie with the depositors of the TSB.
  We accept the fact that the structure and ownership of the TSB is not wholly clear. Nevertheless, implicit in the Page report is the notion that the TSB is a mutual concern. How far did the discussions that took place with the TSB in 1982 and have taken place since, extend? As was clear from our discussions with the TSB and as the Economic Secretary said, the matter was fully discussed with the management of the bank. But given the strong remarks in the Page report and the fact that the depositors are at least possible or partial owners of the TSB, what consultation took place with the movement as a whole to decide its future organisation?
  We accept that the form of the TSB should be clarified, but choices are available. We should reconsider the strength of the remarks in the Page report. Paragraph 263 states:
  "The suggestion has been made that the trustee savings banks should be 'hived off' to the private sector as commercial concerns. If by this is meant that they should have shareholders and operate from the point of view of ownership like commercial banks we see such a solution as neither practicable nor desirable in principle. In evidence, the Committee of London Clearing Bankers put forward the argument that trustee savings banks represent unfair competition in that they are not required, as the nationalised industries are, to realise a 'proper rate' of return on capital employed. In effect, the argument put forward by the clearing banks amounts to saying that the principle of mutuality is inconsistent with free competition. But this is manifestly not true. The principle of mutuality operates in the vigorously competitive fields of insurance and building societies and indeed in certain unit trusts. It is in our view highly suited to the needs of financial institutions such as the trustee savings banks if they play a wider role in the provision of financial services. Thus, there is no need to choose between the extremes of direct central government control on the one hand and full private commercial ownership on the other. We see no reason why the trustee savings banks, as reorganised along the lines suggested in the recommendations set out below, should not exist as mutual organisations primarily in the private sector of the economy. The principle of mutuality means in effect that the profit that accrues to the banks is indirectly distributed in kind to the depositors through improvement in services and lower costs of service rather than distributed to equity shareholders. A set of mutual banks … seems to us an excellent way of providing a competitive service for the financial needs of the small saver and small depositor."
  Given that the nature of the organisation needed clarification if the TSBs were to move ahead, they could nevertheless have moved forward in the form of mutual organisations.
  At the time of the Banking Bill 1978 we envisaged that the TSB would continue to move towards the private sector, that that would be completed by the early 1980s

  39
  and that it would then be developed sufficiently to bring it within the supervisory system of the Banking Bill. That is what the then Minister said. Some of us might have preferred movement in other directions, such as towards the formation of a state bank, but that was not on the cards for the then Labour Government.
  Sir Geoffrey Finsberg rose—
  Dr. McDonald: I shall finish this point before I give way.
  The TSB could have moved into the private sector in a mutual form. We envisaged the move into the private sector, but said nothing about the form at that stage. There is no reason why a mutual form of reorganisation should not be the form that the TSB now takes.
  Sir Geoffrey Finsberg: The hon. Lady said that some hon. Members at that time might have wanted to move in a different direction, such as towards the formation of a state bank. Is that her view now?
  Dr. McDonald: Given the present direction, we would not now envisage that future for the TSB. The existence of a state bank in some form is another matter. I was not referring specifically to the TSB when I made that point.
  Perhaps in his reply the Minister will say something more about the reasons for rejecting mutuality. In our discussions with the TSB we understood that the main reason for rejecting mutuality as a method of development was the need for increased capital. The argument is that the public limited company form of development is essential to raise new capital. When we inquired what the reasons were for wishing to raise new capital, the TSB claimed that it was to improve the technology of the banks. They were among the first to introduce new technology and now need to make systems compatible with those of other banks because banks are being drawn into one network. The TSB wants to update technology, to introduce home banking and to extend the branch system, especially in the south, where it is not strongly represented.
  Mr. Wilson: Will the hon. Lady accept that the Trustee Savings bank has been particularly strong in Scotland and northern England, where it originated? If it is to be the policy of the new unified board to concentrate in the south of England, it may mean that assets which have been utilised in the traditional areas for the requirements of small depositors may now be required elsewhere for industrial purposes. Areas in Scotland and the north of England could thereby be denuded of cash. Would not that be a very bad development for the areas which originally developed the TSB?
  Dr. McDonald: The hon. Gentleman has made a point that I wish to deal with slightly later in my speech. At the moment I was wishing to explore the reasons for rejecting mutual organisation as the proposed mode of development of the TSB, but before I do so I should like to add one further point.
  With the sale of shares, the TSB is generally expected to raise about £1 billion. Its assets are currently worth £700 million. I am sure that the Economic Secretary is aware that there is speculation not so much that the TSB will be taken over by another bank—such speculation occurred at an earlier date—as that the TSB might take over
  40
  another bank. That was mentioned in the Investors' Chronicle in December. It is described as being in a strong position because, unlike some banks, it is not suffering from ill-considered overseas lending. But if it were to take over another bank—perhaps a subsidiary in Britain of a foreign bank, which is one form that the speculation takes— it could extend into overseas lending through a takeover of that kind.
  In future, the Trustee Savings bank will be under the supervision of the Bank of England and not the Treasury. Can we have an assurance from the Economic Secretary that, if a takeover of the kind that I have just described takes place, the Bank of England will supervise it, and supervise the operations of the TSB and other banks with greater care than in the Johnson Matthey affair? It would be a pity if a bank which is currently in a strong position—and is described by all the financial commentators as such—were to fall into the trap of taking over another bank and thereby inherit a lot of difficulties for itself. We want an assurance from the Economic Secretary that in the future the Bank of England will more carefully supervise what banks are getting up to than it has in the past few months.
  The Economic Secretary said that there is to be a limit on the shares held by any one shareholder—5 per cent. for the first five years and 15 per cent. thereafter. In interventions in his speech, it was said that those limits are to be found in the draft memorandum and in the future articles of the company. Indeed, they are set out in the letter which accompanied the White Paper. We do not consider that that is satisfactory. We see no reason why it should not be incorporated in the Bill, which is designed to facilitate the setting up of the central TSB Group plc, which will then be involved in the flotation of shares.
  In the Bill, no date or time limit is set for flotation after the assets have been transferred to the TSB group. We understand that that will be brought about by a statutory instrument at some future date as a result of consultation between the Treasury and the TSB, but there is no time limit specified in the Bill, nor is there a limit in the Bill on the number of shares to be held by any one shareholder.
  We fear that the nature of the bank could change very considerably as a result of the flotation of shares. At present, the TSB has 6 million customers, with 13 million accounts. It is roughly the same size as National Westminster and Barclays. The expectation is that depositors will have a pink priority form to enable them to purchase shares. The closing date for that— 17 December 1984—has already passed. Prior to that date there was a significant increase in the number of accounts, as financial commentators recommended that in order to get the valuable shares in TSB, people should open an account with TSB and thus be able to obtain a pink priority form.
  Therefore, there is an unspecified number of new account holders. Persistent questioning on my part did not elicit the information that I should have liked to have. Obviously, people have been moving in and opening accounts, and they do not really form part of the TSB tradition.
  I further discovered that 40 per cent. of the depositors could not possibly take up shares. Plainly, from the size of their accounts, they had not enough capital available. Obviously, they would not be allowed to borrow from the TSB in order to buy shares in it. Therefore, a large number of the traditional depositors will not be able to take up the

  41
  shareholding, whereas new depositors have come in simply with an eye to taking up the shareholding. There are, in addition, 25,000 members of staff who are qualified to buy shares.
  The allocation of the shares is not dealt with in the Bill and, indeed, it is not mentioned in the letter to which I referred. I know that the TSB has that matter under consideration. We should like provision to be made in the Bill to enable more of the traditional depositors to take up shareholdings., and to give staff a specific right to a number of shares. In that way some of the traditions of the TSB could be preserved. That would be better than simply saying that depositors would have priority forms and that some shares would be allocated to the staff. If those provisions were made, as the bank changed from being some—but not very clear—form of mutual organisation to a public limited company, part of the traditions would be preserved. We should like the Bill to provide that staff have not only a right to buy a certain number of shares but a definite say in the running of the bank. However, those are matters for the Committee stage.
  The Trustee Savings bank has specialised in personal services. Indeed, personal customers account for 95 per cent. of the customer base. One of the features of the bank has not only been its concentration in Scotland and the north of England but the fact that, whereas other banks have withdrawn branches because they found it extremely difficult to operate in certain areas, the TSB has maintained branches in, for example, certain council estates in tough areas of Glasgow where no other bank is prepared to stay. The TSB wants to move into the more lucrative banking areas of the south of England. We do not want it to do so at the cost of its depositors and customers who, as has been rightly said, have helped to build up the wealth of that bank in the past, a bank that is now on a par with the other four clearing banks in terms of size and of the value of its assets. We are concerned that in its move into the south of England, the TSB should not neglect those in Scotland and the north who have contributed to its wealth.
  We are also concerned that in its desire to move into commercial lending, which is a small part of its business at the moment, the TSB does not neglect its involvement in local communities in the north and in Scotland. We do not want to see that bank building up other forms of admittedly profitable commercial traffic while jeopardising its commitment to personal customers. We would prefer it if the Bill ensured that that commitment to and involvement in local communities remained and, in our examination of the Bill in Committee, we shall do our best to ensure that those measures are built into the Bill.
  5.1 pm
  Mr. Eric Cockeram: I declare an interest, being a director and trustee of one of the regional TSBs since the 1960s, which has been a fascinating period while the TSBs have been developing.
  I suppose that the seeds of the Bill were sown in 1971 when the then Chancellor of the Exchequer, now Lord Barber, recognised that the national savings movement needed bringing up to date. Much of it had not altered since 1945, at the end of the war, and that included much of the TSB movement. Therefore, the Page committee was set up. It was interesting that Sir Harry Page, the chairman, who tragically died two or three weeks ago, was a former treasurer of the city of Manchester. Other notable
  42
  northerners, some from Liverpool, were on that committee, which was appropriate because the TSBs had their roots in the north of England and in Scotland.
  The committee reported in 1973. If its conclusions could be summed up in one sentence, it would be to the effect that the national savings movement, including the TSBs, needed root and branch reform. A whole chapter was devoted to proposals about the TSBs. Shortly after that committee reported, we moved into the early months of 1974, when there was a general election, and the right hon. Member for Leeds, East (Mr. Healey) found himself Chancellor in the Labour Government. It was a tribute to him and to the common sense of the Labour Government at that time that they likewise accepted the reasoning behind the Page report and that, as its proposals were accepted in broad terms, this did not become a party political matter.
  The TSBs proceeded to move more into the banking sector and away from national savings. They issued cheque books and in 1975 became members of the Bankers Clearing House to enable them to offer that facility. They offered personal loans in 1977, as well as overdrafts—two different things. Mortgages became available in 1979, as did commercial lending. The Trustcard came in as well.
  It is significant that the TSBs have such a strong base throughout the country in the section of the public that, to use the jargon, used to be "unbanked", and that the Trustcard was an instant success. The TSB is now the second largest bank in the credit card business. Barclays is the largest and TSB is the second, followed by National Westminster, Lloyds and the troubled Midland, which collectively issued a card under one name. However, in pure banking terms the TSB is now No. 2 in the movement.
  The TSB also acquired the United Dominions Trust, thereby being able to offer hire purchase and other facilities. It set up a trust company and has an insurance broking subsidiary. It has travelled a long way down the road to offering a full monetary and banking service to a section of the community which formerly, in broad terms, was unbanked. That is to be commended. The handling and retaining of cash in the home is not desirable these days. With modern computers and banking methods it is possible for all sections of the community to operate a bank account economically. The TSB has played a significant part in achieving that objective.
  Therefore, in 10 years between 1973, when the Page committee reported, and 1983, the movement went a long way. It started off as little more than another arm of the national savings movement and a decade later it was virtually a full bank. That is a great tribute to the management of the bank, which has conducted that pretty substantial metamorphosis without any great traumas, carrying with it the good will of the customers and the staff, who had not been brought up in the banking world.
  The TSB now has £8 billion in deposits, 6 million customers and 13 million accounts. It is a formidable organisation. Its reserves are in the region of £700 million and when, I hope, the Bill is passed, and after the public issue, its reserves will be over £1,000 million—no small organisation to have grown from what was little more than a part of the national savings movement.
  As chairman of the all-party TSB group, I should like to comment—I am sure that other hon. Members share or have expressed this view—that there was a Bill concerning the TSB in 1976, another in 1978 and yet

  43
  another in 1981. There is now a fourth in 1985. There are not many organisations—except perhaps British Rail, which seems to have a Bill every year—that have had four Bills in nine years. I think that that has been due in no small part to the lack of clarity of thought in the early days after the issue of the Page report about where the TSBs were going; but, happily, in more recent years, since Sir John Read took over as chairman and formed a management team including several people who came from the non-TSB world and who brought in fresh minds and thinking, there has been an acceleration of clarity of thought so that people now know exactly where they need to go and are setting off down the road of the decision—which I believe is fundamental—that the TSB should be a company with limited liability. That has many advantages. It not only clarifies the problem of ownership which, as the hon. Member for Thurrock (Mr. McDonald) said, was one of the issues on which there was considerable doubt in the past—that doubt must be resolved one way or another—but enables the bank to raise fresh capital by the issue of shares, as is intended, following the enactment of the measure, and on a future occasion, should the need arise and should it be desirable, to raise further capital.
  It is abundantly clear that anyone in the banking world today must have access to further capital at short notice, if required, as the National Westminster became sharply aware in 1975 when its shares fell to 88p and it was necessary to raise capital very quickly when the shares rose above par again. I am sure that the currently much-troubled Midland wishes that it could raise further capital now. It is essential that the TSBs have that long-stop facility. It may also be needed for highly desirable objectives, such as further expansion and additional facilities for customers. The Bill points the way ahead so that we may now wrap up the conclusions of the Page report in relation to the TSBs.
  The purpose of the Bill is fivefold. First, it completes the change from a national savings organisation to a bank offering full financial services to its very wide spread of customers, the bulk of whom are in the north of England and in Scotland.
  Secondly, the Bill provides a constitutional framework and removes the ambiguity of ownership which has existed so far.
  Thirdly—I hope that my hon. Friend the Economic Secretary will not mind my saying this— the Bill removes the TSBs from the shackles of the Treasury and puts them under the Bank of England. That is desirable for a number of reasons, not least because, if the new TSBs are to compete with other private banks, they should share the same umbrella and regulation.
  Fourthly, the Bill will strengthen the TSBs' reserves and allow further capital to be raised. As has already been pointed out, it is not a privatisation measure at all.
  Fifthly, it will establish very wide ownership of the TSBs. All staff who wish to become shareholders have been assured that they will be able to do so. One hopes that the same will apply to customers wishing to become shareholders.
  Those who ask what is so desirable about having shareholders and why the TSBs should not continue as a mutual organisation should consider the history of the matter. Not putting too fine a point on it, it must be
  44
  admitted that in the 1950s and 1960s the TSBs were in something of a rut. That was one of the reasons why the Page cornmittee was set up. At that time there was no profit incentive and no incentive for management to expand and modernise. I believe that the very existence of shareholders will prove to be in the interests of depositors, as it has been in the case of the other clearing banks. I am by no means convinced that mutuality achieves that objective. In passing, I might whisper in the ear of my hon. Friend the Economic Secretary that the same might well apply to building societies, although that does not arise under the Bill.
  For all those reasons, I support the objectives of the Bill, although, like many hon. Members, I shall wish to examine it carefully in Committee. I believe that the Bill is desirable in the interests not only of the staff and customers of the TSBs but of the nation as a whole. The number of clearing banks has fallen to four in recent yars. I believe that the establishment of a fifth is economically desirable for the purposes of the country as a whole. I wish the TSBs well in the future and look forward to the early enactment of this legislation.
  5.14 pm
  Mr. Robert Sheldon: The hon. Member for Ludlow (Mr. Cockeram), with whom I have had the pleasure and privilege of working on a number of occasions in the Public Accounts Committee, rightly pointed out the importance of local interests in the trustee savings banks. Time and again we come back to the question of how to retain that strong local interest, which has been the driving force of the TSB and which makes it so different from many other banking institutions. The hon. Gentleman was also right to emphasise the advantages that the TSB has brought to people who would otherwise be "unbanked". I agree, too, that management was somewhat restricted before the 1976 Act. Opportunities existed but were not being taken and the success of that legislation, which I had the privilege of piloting through the House, lay in opening up opportunities for effective management of the interests of the banks themselves as well as their depositors and customers.
  A total of 13 million accounts means that we are dealing with a very wide spread of the banking population. Sir Harry Page was a great city treasurer for my home town of Manchester; he was a person of great repute and standing and I knew him well. When he produced his report I thought that he had the balance right and I was most enthusiastic about it. The history of the Trustee Savings bank derives from the long neglect of people who, in the 19th century, were regarded as having insufficient means to use banking services. In those days, the banks were regarded as existing to serve people with substantial amounts of money on which they could obtain substantial returns in interest. Various enthusiastic individuals felt that that neglect of working people must be remedied and organisations such as the Yorkshire Penny bank were set up to give ordinary working people a fair deal for the disposition of their money so that they could obtain a comparable return on their deposits. All this was before small savings possibilities became available through the Post Office. There was little further development for many years.
  Following 1965, cheque accounts were introduced and the TSBs were freed from their historical restrictions. That

  45
  was the motive behind the Page report. The question was how to retain the enthusiasm and dedication that Page found while providing for the ability to expand and advance that is necessary in the modern banking world. I had a great deal of sympathy with the solution proposed by the Page report. It suggested that the TSB should be a third force, in addition to the clearing banks and the National Giro, both of which had a clear market for their activities, with clear distinctions between the different forces.
  The 1976 Act sought to advance the opportunities of the TSBs by allowing them to undertake personal loans, overdrafts, credit card facilities, small business loans, mortgages and unit trust services. That legislation was highly successful and the idea of the third force remained intact. There was to be freedom from direct and detailed Government control, which had previously played a part in shackling the opportunities open to the TSBs, and the organisation of the units was to be strengthened on a regional basis. Some people were unhappy at the idea of a regional element being brought into the small, tight local organisation of the TSBs as a means of strengthening them. In the main, the problems were overcome, although some echoes of them still remain. There was to be a central authority from within the movement to provide a central direction.
  That was the Page path—the establishment of the trustee savings banks as a mutually owned third force. As a result of the Bill, instead of a third force there will be two forces. There will be the clearing banks and National Giro, and inevitably the trustee savings banks will drift towards the clearing banks. When the Economic Secretary to the Treasury talked about the end of an era he said more than he had meant to say. I believe that there is a danger that the distinguished history of the TSBs will come to an end rather more quickly than anyone would wish.
  My hon. Friend the Member for Thurrock (Dr. McDonald) rightly asked what discussions had been held, not with management—clearly the Bill is the result of discussions with management—but with customers. If the ownership of the banks is uncertain, the uncertainty must lie between the management and the customers. The most important discussions should have been held with the customers. I hope that the Minister will reply to my hon. Friend's questions.
  I also ask the Economic Secretary about the ownership of the TSB. He said that—as we know from the letter that was part of the White Paper—no one is allowed to own more than 5 per cent. for five years or 15 per cent. afterwards. I asked the Economic Secretary what assurances there would be on that point. He was unable to give me an assurance. That stipulation will not form part of the legislation. It will appear in the memorandum and articles of association. There is a world of difference between a promise made in the memorandum and articles of association and a provision with legislative force. All that is needed to change the memorandum and articles of association is an extraordinary general meeting. The procedure for changing legislation passed in the House is very different and much more rigorous. The memorandum and articles of association could be changed at any time—they are only promises—and that would mean the failure, collapse and demise of the third force.
  The possibility of another body taking over the TSB after the memorandum and articles of association have been changed is not the only question. As my hon. Friend
  46
  the Member for Thurrock pointed out, the TSB could take over other banks. That could occur not in the obvious way but by way of a reverse takeover. The TSB could rake over a rather larger body and use its name and standing to do a reverse takeover, and that would be the end of any hopes for a third force.
  That is all very sad. It is not what I expected when we started on this road eight years ago. I thought that we were bringing in more imagination and responsibility, and giving the managers of these splendid institutions powers that they would use to create strong local organisations that could play an increasingly important part in their communities.
  Mr. Cockeram: The right hon. Gentleman comes from Manchester. He will recall the problems encountered by the District bank in trying to remain a local bank. Coming from Liverpool, I recall the problems faced by Martin's bank in trying to retain regional autonomy. The objectives outlined by the right hon. Gentleman may be desirable, but it has not proved possible to retain small regional banks. Especially since the advent of computers, there must be a national network. Has the right hon. Gentleman fully taken that point into account?
  Mr. Sheldon: Yes, indeed. That was the most important aspect of the 1976 Act. The Act embodied an understanding of the need for some central organisation but allowed those operating in centres of population to retain their own ways of acting and to remain a part of the local community. I had hoped that that spirit would be retained, and I am sorry that we heard nothing from the Economic Secretary—who went into considerable detail— about the reasons for the failure to retain some element of it. A great opportunity has been lost and I view the Bill now before us with great regret.
  5.24 pm
  Sir Geoffrey Finsberg: I, too, declare an interest. Since 1953 I have been either an honorary manager or a trustee of the trustee savings banks, and am now a director of its south-east region. I am also a depositor. That is an important point to which I shall return.
  It is important to recognise how it has come about that we are discussing such a Bill. There is a long history. I remember being persuaded by a senior alderman in the borough which I live in and represent to join the committee of honorary managers of the local branch. Being a cautious person, I asked what I would have to do. I was told that my position would be much like that of the Paymaster General— I would sign away all my rights to sign cheques. My position would be an honorary one, but I would be expected to represent the bank to people in the locality, to persuade people that the bank was a good institution, and to work with the bank to try to increase the number of depositors.
  In those days, vast sums of money were lent by the TSBs to the National Debt Office for a measly return. Over the years, the Treasury has made enormous profits out of the TSBs. If the TSBs had been allowed to lend their money on commercial terms, it would have generated very much more money for the TSBs themselves. Secretly, therefore, the Treasury has not derived much pleasure from helping us to reach this stage.
  That was the start. I was then translated to the board of the London TSB. We had annual meetings at the Mansion

  47
  house under the presidency of the Lord Mayor. Then, as now, I was not always prepared to use only the calmest of language. I remember how at one annual meeting I exploded when the chairman of the London board said that there were certain problems involved in making it possible for our depositors to have their own chequebooks. I commented that what he really meant was that the clearing banks wanted us to remain as third-class customers, obliged to make our depositors pay for each cheque. They were not prepared to allow us to give a decent service. The chairman said, "That might have been expressed in more diplomatic language, but you are perfectly right."
  The progress of the TSBs to their present state therefore met not only with less than enthusiastic support from the Treasury but with great opposition from the private sector banks. However, in time those banks realised that there was a great advantage in the entry into the field of an organisation that had found a way of interesting those people to whom my hon. Friend the Member for Ludlow (Mr. Cockeram) has referred as the unbanked. There was then a change of attitude. We were able to have cheque books, the development continued, and we had Page.
  As the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) said, Page was a watershed, as he did more than look at the trustee savings banks. I contrast what the right hon. Gentleman said about Page's emphasis upon the community nature of the trustee savings banks with the way that he virtually killed the national savings movement by killing the national savings stamp and the groups that, up and down the country in every street and village, collected vast sums of money for the national savings movement. It is a difficult thing to reconcile. The right hon. Gentleman will remember the large deputation that I led to try to save the national savings stamp groups. It was an all-party issue. I found it strange that this move came from Harry Page, whom I had known well in local government circles, although I do not have the privilege and pleasure of hailing from Manchester. I visited Manchester about once a month, so I knew its rains as well as Harry Page.
  I was a little startled when I listened to the hon. Member for Thurrock (Dr. McDonald) because she obviously had to delve deeply to bolster her view of the trustee savings banks. I think that I can say without fear of contradiction that no member of the parliamentary committee has ever heard the origins of the trustee savings banks described as "primitive Thatcherism". I am not sure where she got that phrase from.
  Dr. McDonald: I got it from the Page report.
  Sir Geoffrey Finsberg: Page did not talk about Thatcherism. He was an astute enough treasurer to have said that Thatcherism, if there is such a word, when applied to rate capping for Manchester, was right and was brought on the Manchester council by its own activities. Harry Page, from his great height, would have told his councillors that in no uncertain terms.
  The hon. Lady had certain other problems. She referred, for example, to people opening accounts to obtain benefit from the preferential pink form that will be available when the share issue comes. I am sure that she will have reminded herself that the moment that the Bill was printed, a stop was put on new depositors qualifying
  48
  for the preferential issue and that 17 December was the cut-off date. Therefore, people cannot open new accounts in order to gain preferential treatment. Equally, it has been firmly said that only accounts that have been kept open will qualify in that way.
  The hon. Lady was also worried about the arrangements for purchase for the staff and customers. I shall quote from a useful document that the chief general manager of the TSB issued on 18 December to the staff. It says:
  "There will be priority arrangements for staff and customers. The priority to TSB customers recognises our particular wish to reinforce the special relationship which has always existed between the TSB and its customers."
  That has been a most important element in the trustee savings banks movement.
  The staff in the TSBs are different from the staff in the average high street bank. They are not the sort of people who suddenly appear out of cupboards. They are constantly in the bank, in the banking hall, meeting and serving customers— something that one finds less frequently on the part of the managers in most joint stock banks. Therefore, the TSB customer knows what the manager and staff of his branch look like and how they act. That is a useful and important factor.
  The hon. Member for Thurrock said that, according to her research, 40 per cent. of TSB customers would not be able to take up the share issue because of the size of their accounts. That is a wrong assumption and one that she cannot make. She assumes that everyone with an account at the TSB has no account with any other bank. What is clearly said is not that one may purchase shares only to the value of one's account in the TSB, but that one's account in the TSB is the key to purchasing shares. I assure the hon. Lady that tens of thousands of people—I have not done the research—have accounts in the TSB and in other banks. They have those TSB accounts—the hon. Lady forgets this as well— because, until about 18 months ago, one got limited tax-free interest on one's current account in the TSB. Therefore people opened accounts there in addition to having accounts in joint stock banks.
  Dr. McDonald: I was going on the percentage given to me by the TSB.
  Sir Geoffrey Finsberg: I hope that the hon. Lady will help me, as I should like to be accurate. Did she ask the TSB how many of its depositors had accounts that would enable them to purchase shares, or did she ask how many of its depositors had accounts with less than £500? I do not wish to do her an injustice, but unless one knows the question that she put, the answer is difficult to evaluate, as is shown by the phoney public opinion polls produced from across the water by Mr. Livingstone. They are meaningless unless one knows what the question was. Will the hon. Lady tell us what the question was? I am searching for help, not trying to be difficult.
  Dr. McDonald: I asked a simple question. I was interested in what proportion of depositors were interested in taking up shares in the TSB once it was floated. I have given the answer that I received. If the hon. Gentleman wishes to pursue this further, he should ask the TSB about the nature of its research.
  Sir Geoffrey Finsberg: I shall do so. If that is the case, I question not only the hon. Lady's assumptions, but the basis on which that information could have been given to

  49
  her. No one can say what the attitude of the depositors will be and no one knows what accounts depositors have in other banks. The hon. Lady should not put too much reliance on the 40 per cent. figure. I do not blame her for for putting it to the House, but I question that figure, from whatever source she got it, until I know the basis on which the information was supplied to her.
  It is true, as has already been said today, that the TSB movement used to be Scottish-oriented. In the past 10 years, the enterprise and thrift of the south has overtaken that of the Scots, and it is no longer possible to say that Scotland is in the position that it was until about a decade ago. Until then, it was the major component of the TSB and year after year had bigger profits than the other components. However, those of us in London and the south-east always arranged to lend our resources to the north-west, the north-east and Scotland to help them in the opening and development of new branches, even in those days, when we were the poor relations of the north. I see no reason why that should not continue.
  Mr. Wilson: I do not necessarily accept the hon. Gentleman's last assertion. However, does he agree that there is a difference between the south overtaking Scotland in terms of the development of TSB operations and what is proposed in the Bill, Which is the taking over of the autonomous TSB within Scotland? Under the previous structure, the control of the operations in Scotland lay with the trustees of the TSB in Scotland, whereas now it will lie with the group.
  Sir Geoffrey Finsberg: The complete autonomy that existed in the days of the Glasgow and Edinburgh banks and the wide variety of Scottish trustee savings banks was surrendered after the Trustee Savings Bank Act 1981 was passed. That was when we established the central board. The hon. Gentleman is addressing his arguments to something that happened several years ago. If he still feels strongly about the matter, he might take it up as a quid pro quo for those in England who are less than happy that the control of Williams and Glyn's bank will be taken over by the Royal Bank of Scotland. Such matters work both ways, and one must occasionally accept compromises. The Bill provides the trustee savings banks that we really want. It gives the opportunity to people to continue the work that they have been doing.
  I began by talking about the honorary managers, and I return to the point made by the right hon. Member for Ashton-under-Lyne about the localities. In his letter of 18 December, the chief general manager said:
  "We will maintain our traditional role as a personal bank and continue to build on our achievements in the communities which we serve."
  The regional board members act as liaison officers between the regional boards and the central board. They also visit branches and "sell" the bank, not only to personal customers but to professionals and institutions, on the basis that potential customers will know that local people are very much interested and involved. I have spent some 30 years in voluntary service of the trustee savings banks, and I would not support such a Bill if I believed that it would remove the link with the communities.
  Two people might be singled out on the long road during the past 20 years towards the independence of the trustee savings bank movement. One is Sir Athelstone Caroe, who did an enormous amount in this area, and the other is Philip Keens, who pioneered much, including the
  50
  unit trust movement of the TSB and the Trustcard. The movement owes a debt of gratitude to such individuals who dedicated themselves to the work of the trustee savings banks. They will be satisfied that the Bill provides—
  Mr. Gerald Bermingham: I apologise for not being in the Chamber for the beginning of the hon. Gentleman's speech. He may already have dealt with the point that I wish to raise. How will the independence of the trustee savings banks be improved by removing them from the ownership of the common people and putting them in the hands of a few shareholders?
  Sir Geoffrey Finsberg: The hon. Gentleman has just wandered into the Chamber. He has missed at least five speeches that would have told him all about this. Clearly, he has not even read the documents or the White Paper, which make it clear that the present ownership is problematical. He does not understand that preference in the purchase of shares will be given to customers and staff. With the greatest respect to him, may I say that I hope that he does not advise his clients without having read all his documents. He did this to me once before, and or that occasion he had to say that he was sorry. His intervention, again without proper preparation, does not do him the credit that he usually deserves for his researched speeches, which are good.
  The Bill deserves commendation, and I hope that it will pass rapidly through the House.
  5.44 pm
  Mr. Ian Wrigglesworth: As one who worked in the state banking sector and in the joint stock banking sector before coming to the House, and as one who served with a former Economic Secretary to the Treasury and the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) in the Committee and other stages of what became the Trustee Savings Bank Act 1976, I share some of the reservations that have been mentioned by hon. Members about the change that will be introduced by the Bill.
  I was pleased that, in introducing the Bill, the Economic Secretary to the Treasury did not make exaggerated claims about it being a brave new venture in increasing competition in banking, although he mentioned it in passing. I was disappointed that the Bill was paraded in the Queen's Speech as a great venture in providing consumers with more competition. However, if one knows what the trustee savings banks have done during the past few years, and if one reads the White Paper, one knows that that competition began a considerable time ago. The real genesis of the Bill is the lack of clarity over the ownership of the trustee savings banks following the 1976 Act.
  The Bill would not have been before us, and none of the claims that have been made would have been made, had we clarified the ownership of the banks in the 1976 Act. We can all be wise after the event, but it might have been better had we gone down the road of mutuality in 1976—some of us would prefer that now—and made it clear that that was what we intended. We all expected it to be a mutual organisation and we did not raise the question of ownership during the passage of the Bill. If we had said clearly that the trustee savings banks should be

  51
  mutual organisations, they would have provided the genuine third force in banking that Page intended and many of us foresaw.
  Mr. Robert Sheldon: We saw it as a third force in banking—a third force that was mutually owned. The path that we envisaged was clear.
  Mr. Wrigglesworth: It has become clear that the definition of mutuality, unlike the co-operative sector and the building society sector, was not specified as clearly as it might have been. I do not blame the right hon. Gentleman for that. We were all involved in the debates in Committee and we saw no need for it at the time. We took it as read that they were mutual organisations and that they would remain so. All that I am saying, with the benefit of hindsight, is that it might have been better had that view been cast in black and white in the Act so that there was no doubt about it.
  The lack of clarity created the desire of the trustee savings banks and the Government to introduce the Bill, which may force the former to develop in a remarkable way. Since the 1976 Act, the trustee savings banks have developed a competitive edge and have been responsible for developments in banking that have been of great benefit to consumers. They have a proud tradition of including within their commercial objectives clear social purposes. Those social purposes—helping less well-off people to have banking facilities, even though they got only low rates of interests on their deposits—formed a desirable role and many of us would like to see it retained.
  Although I shall not oppose the Bill, I hope that some of the propositions that the trustee savings banks have made, and which the Minister referred to, can be set more firmly and that we can be given stronger guarantees about some of the undertakings that have been provided. I hope that some of the proposals, such as those on share ownership, will not be mere gestures.
  I also hope that the banks will not follow the example of the polytechnics that want to become universities. I hope that they will pay more than lip service to their character and traditions and, while being fully commercial and successful, will seek to continue with their traditions.
  I have a number of questions for the Economic Secretary and I hope that I shall be able to pursue them in Committee so that we can amend the legislation to set more firmly the undertakings given by the chairman and by the Economic Secretary.
  I hope that the Economic Secretary will tell us more about how the flotation of the shares will be organised and controlled. He has given us little information about that and he should not expect hon. Members to be satisfied until further details are made available.
  We have had an undertaking that shares will be given to staff and customers. What proportion is it intended should go to the staff and what proportion to the customers? May we have undertakings on those figures? I should like to have the details laid down in the statute, so that they cannot be changed in the memorandum and articles of association at a subsequent EGM.
  Regional charitable foundations are to be established. That is a good idea, but may we be told how many shares will be vested in the foundations, how large they will be, what sort of work they will do, who will control them, whether they will have a relationship with the regional
  52
  boards and what will be their relationship with the whole banking movement? Will they simply be independent charities doing the same sort of work as many other charities? If they are to have an impact and to carry on the traditions of the TSBs, they will have to retain links with the banks—not just a shareholding in the banks, but a closer involvement. Can the Economic Secretary give us some assurances on those matters?
  Such undertakings will reduce the fears of some hon. Members. There is unease about the direction that the banks will take once the Bill becomes an Act. The Economic Secretary will ease the passage of the legislation through Parliament if he will give us firm guarantees and will consider amendments in Committee to enshrine undertakings in the statute. If that happens, all hon. Members will wish the legislation well and will hope that the TSBs succeed in their new form.
  5.54 pm
  Mr. Michael Brown: I welcome the Bill. It is not a privatisation measure, but a technical Bill, which is required because of an omission from the 1976 Act, which made a practical contribution to the development of the TSBs.
  I acknowledge the view expressed in 1976 about how the Trustee Savings bank should develop, but it is inevitable that the status and constitution of the bank now have to be made clear. It is important to establish in legislative form the future ownership of the TSB. It is important that there should be shareholders and accountability, and that will be provided by the Bill. As every hon. Member who has spoken in the debate has made clear, it is also important to retain the character and tradition of the bank; we should not merely pay lip service to its tradition and character.
  I have absolute confidence in the managers of the bank and in the boards, which include members such as my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) and many other people in public life. Their continuing association with the TSB will ensure that its character and traditions are retained.
  I have a particular affection for the Trustees Savings bank and the character of savings that it has established, particularly in the part of the country that I represent. It has brought the concept of banking to small investors and savers. It is probably agreed on both sides of the House that the TSB is an ideal bank for those who still fear the idea of having a bank account with one of the traditional banks. The TSB introduces them to banking, cheque books and banking services, which are so important to our way of life.
  I am pleased that employees and depositors will be given priority in the ownership of shares, though I do not agree with the hon. Member for Stockton, South (Mr. Wrigglesworth) who believes that the pattern of share ownership needs to be established in legislative form.
  If I am fortunate enough to serve on the Standing Committee on the Bill, I shall ask my hon. Friend the Economic Secretary about his proposals for ensuring that employees and depositors have a genuine opportunity to become substantial shareholders. I shall also pursue the question of the maximum shareholdings. I understand that it is envisaged that the maximum initial shareholding should be 5 per cent. and that eventually the maximum could increase to 15 per cent. I have slight misgivings

  53
  about the figure of 15 per cent. Fears have been expressed about that proportion; they may be groundless, but 15 per cent. seems a little high.
  It is important that we take on board the point made by the hon. Member for Stockton, South to reassure the outside world. It would probably be helpful if, in Committee, we were fairly specific about how the floatation takes place. The Government's record with regard to share flotations of other newly privatised companies is very honourable. However, the Trustee Savings bank is a unique institution and it is probably not quite right to use the word "privatised". Nevertheless, it is important to ensure that the country as a whole has confidence in the way in which the flotation takes place. It would therefore be helpful if my hon. Friend the Economic Secretary could give us some idea about that in Committee.
  On the whole, I think that the measure is inevitable and, indeed, very important. I note the remarks of, I believe, the chairman of the Trustee Savings bank, which were echoed by my hon. Friend the Member for Hampstead and Highgate. The chairman said that the Bill, which is welcomed by the Trustee Savings bank, would not in any way make changes to the important contribution that it makes in maintaining its traditions as a personal bank. He also said that the bank was proud of its achievements in the communities which it was established to serve. I acknowledge the point that my hon. Friend made and see no reason why the legislation should alter that important community relationship.
  However, in this modern world of complex and complicated banking it is right and proper that depositors with the Trustee Savings bank should be able to share in the advantages that accrue to those who use the traditional banking system. There is no doubt that in the past the TSB's depositors have to some extent been second-class banking citizens. However, I acknowledge that during the past few years the TSB and the House, through the contribution of the 1976 Act, have done much to ensure that the TSB's depositors are not second-class citizens.
  The TSB is a very fine institution and I wish it well. The Bill can only strengthen the important contribution that it makes to banking to this country.
  6.2 pm
  Mr. Jim Craigen: The hon. Member for Brigg and Cleethorpes (Mr. Brown) hopes to retain the character and tradition of the TSB movement, but that hope is somewhat inconsistent with this Bill's objectives. The Bill effectively throws out of the window any concept of the TSB as a third banking force in the United Kingdom.
  The Government should be embarrassed by the Bill on three main grounds. The first concerns the issue of ownership. The Bill seeks to authorise the selling of an unowned business. Ministers say that the TSB wants shareholders. The TSB's managers, or at least some of them— the ones that count—say that the Page report presaged the Bill. But, as my hon. Friend the Member for Thurrock (Dr. McDonald) pointed out, the committee, which reported in 1973, clearly said that the trustee savings banks should not be "hived off'. Indeed, the review body of the late Sir Harry Page went out of its way to say that the need for shareholders was "neither practical nor desirable". Therefore, we are changing the whole concept of the TSB movement.
  54
  I agree with some of the points made by the hon. Member for Ludlow (Mr. Cockeram) about the fact that the TSB has been improving its services, has gained a better image and has improved its marketing during the past decade, but that has been without the benefit of shareholders. If a Labour Government had proposed nationalising the TSB, all hell would have been let loose. My hon. Friend the Member for Thurrock says that the Bill does not mean privatisation. I suggest that it is closet privatisation. A Conservative Government propose to sell an £8 billion-plus business and expect hon. Members to jump up and down with joy.
  The second major ground of embarrassment for the Government concerns, ironically, the decision that the Chancellor of the Exchequer announced today about the reintroduction of the minimum lending rate. The White Paper says that the Government attach great importance to competition in the banking sector. Last week we had the undignified spectacle of the Prime Minister being dragged by the hair by the banks over the setting of interest rates. Last week it was not the Chancellor of the Exchequer who decided that the interest rate should increase to 10·5 per cent. but the National Westminster bank, and that started the ball rolling. Now the Government have done a U-turn over the free operation of market forces. That is the message that the Chancellor of the Exchequer signalled this afternoon. I have never heard the Chancellor give such brief replies to each and every question. Unfortunately, Mr. Speaker, I did not catch your eye then, although I had a question that I wanted to put to the right hon. Gentleman on that very point.
  I just wonder why the Government have been such a willing partner in the conversion of the TSB into A.N. Other plc. If the Government really wanted more competition in the banking sector, why did they not say to themselves, "Let us have a bank that is different and a bank that is not going to follow the leadership over higher interest rates"? Higher interest rates will affect not only those with mortgages but local authorities, which will have to pay more for the borrowing that the Government have authorised.
  I am disappointed that a reasoned amendment was not tabled. The Government have given insufficient consideration to the concept of a mutual bank that is set up for the benefit of customers and staff and holds out the prospect of lower interest rates and improved customer services.
  I entirely agree with the point made by my hon. Friend the Member for Thurrock about the staff's opportunity for greater participation in the running of the trustee savings banks. However, I have noted some press comment that people in certain quarters feel that perhaps the staff union is too strong in the TSB. Once these new faceless shareholders come into being there can be no guarantees about what will happen in connection with anything to do with the TSB, never mind the customers or staff. The trustee savings banks will be under first-time ownership. Shareholders will expect dividends. My goodness, what an inviting prospect they face. Look at the reserves of the TSB. It did not get involved in the debt-ridden problems of Latin America or elsewhere. Perhaps its constitution saved it from such follies.
  Some managers say that their accountability should be clarified. It will be clarified when the shareholders tell them, "Your responsibility is to us boys, not to the customers." Misgivings have been expressed about the

  55
  restraints imposed on the percentage of shares that can be taken up. The shareholders of today may not be the shareholders of tomorrow. Much will depend on the price of shares.
  The Government should be shamefaced over the involvement of the TSBs in the community. The White Paper acknowledges the developments of TSBs over the generations. In Scotland and the north-east of England they have developed particularly well. In Scotland, one fifth of the adult population—I am included—has a TSB account. The reason for that is historical. Many of our grandparents and parents believed in thrift and opened an account with the TSB.
  I declare an interest as a TSB depositor. Historical significances have been brushed aside. Traditionally, in Scotland, people invested in the TSB, whereas in the south of England and elsewhere they invested in building societies. Imperceptible differences in house purchase have occurred which are not always recognised.
  Industrial and commercial development in Scotland and elsewhere depend upon savings deposits being used for the regeneration of areas in which people invest their money. I fear that those priorities will be changed.
  The TSB has an extensive retail network of branches in many parts of the country, but there is an underlying weakness in the south of England. Money is spent on opening branches in the south of England in the hope that the new TSBs will muscle in on the other banks. Do the Government think that the other banks will sit back and allow that to happen without challenge?
  Charity foundations put patronage into the new board's hands. Which charities will be involved and what choices will be made about the good works that they want? The hon. Member for Dundee, East (Mr. Wilson) talked about the Channel Islands. Why cannot there be a similar guarantee for the Scottish TSB on the allocation of shares?
  The Minister does not flannel me by saying that the TSB in Scotland will be able to issue its own bank notes when the rest of the realm is moving to coin. More than the sentimental sop of a bank is involved. I want to know from where it will be controlled. That is significant for the depositors and staff.
  The Bill is an open sesame— a mouth-watering prospect of shares in an £8 billion-plus financial and banking network. It is a great temptation. Shall I decide to buy shares now and sell them later?
  Mr. Wilson: Will the hon. Gentleman do so?
  Mr. Craigen: I am thinking about that.
  The Bill involves more than that which is contained in it or the White Paper on which it is based. It is an amber light which leads to a green light for the building societies. I suspect that there will be an almighty gold rush by the building societies. They will all want to become plcs. At least they will be urged in that direction by those who see a substantial profit in the transformation of such organisations.
  Protections against takeovers, which are not in the Bill, are insufficient. As the White Paper says, a 170-year-old savings movement, which has had a "special statutory relationship" with the Government, will be transformed so that it is on all fours with any joint stock bank.
  Competition will be stiff. No one will get his own way. The managers might look for bigger salaries in line with
  56
  managers of joint stock companies, but the shareholders might have different ideas. Despite the bland assurances this afternoon about takeovers being unlikely, the TSB could become the Trojan horse for a foreign bank entry into the country.
  There is a prospect of a cartel. There are multiples of 5 per cent. or 15 per cent., and an annual general meeting might decide that it does not like a particular agreement.
  This Bill is not good. In some ways it is sinister. I am in favour of improving the services provided by the TSB to its depositors and customers, but the imposition of shareholders is another matter. There is no guarantee from any quarter that the shareholders to come will be the depositors of the present.
  It is claimed that there has been a rush in demanding the pink forms needed to buy shares. I am reminded of the parable of the labourers in the vineyard, when all the latecomers expected to take the advantages and assets of a movement built up over generations by depositors past and present.
  6.18 pm
  Mr. John Mark Taylor: Like the hon. Member for Glasgow, Maryhill (Mr. Craigen) I shall have to think carefully when the time comes about whether I want to be a shareholder in an incorporated TSB. I have to declare an interest, as others have, in that I am a depositor with the Trustees Savings bank. The professional firm in which I am a partner uses some of the very good, progressive and commendable banking facilities which the TSB provides these days.
  I draw two conclusions. As many hon. Members have said, incorporation of the TSB seems to be desirable, not least to clarify the TSB's status—which is complex if not confused— and to clarify the ownership and proprietorship of the TSB.
  The hon. Member for Maryhill made some interesting points, as did other hon. Members, about whether there should be a bank among our financial institutions that was different. That interesting question certainly does not answer itself, but the fact remains, which is particularly poignant today, that in the end the banks cannot determine to be different simply for the sake of being different.
  If the advanced services that people require in an increasingly complex fast-moving and computerised banking world can be provided by other banks, the TSB must provide them too. Therefore, the TSB is driven by its perfectly worthy need and ambition to stay in the banking game to provide modern services. The corporate basis for the TSB will facilitate that.
  Secondly, interest attaches to the sheer number of the depositors with the TSB. That number is so great that the potential spread of equity on the far side of incorporation and the allocation of shares is such that the membership and the interest and participation in that bank will be wide. That is likely to be extremely healthy for the TSB in terms of public ownership, using that phrase in its best sense. It will mean that there will be a wide and general participation in a major institution which affects our daily lives and contributes to the services that we all want
  We shall have to wait and see what the share take-up turns out to be. The British Telecom share take-up was refreshing. I doubt whether the experience of BT employees will in any way discourage TSB depositors. Some people are doubtless both TSB depositors and BT

  57
  employees and I am sure that they will be looking forward to their second opportunity to participate in a major national asset with their own assets.
  Since we are all talking about the TSB, I should in fairness declare that I have nothing against the big four banks, but neither am I against them being kept on their toes. The TSB, with its large number of depositors, can play a part in ensuring that we all get the best terms because we are free to move our business elsewhere if we want to do so.
  Several interesting historical views have been offered to the House in the debate, on the different parentage of the different branches of the TSB. In my part of England, near Birmingham, the origins of nearly all the TSB branches can be traced to the Birmingham Municipal bank which played an important role in the life of Birmingham and its suburbs and served its citizens well. For many of them, it was their kind of bank. I take note of the number of hon. Members who have said that that atmosphere of the bank is worth preserving for that reason and I am in sympathy with that view. Not only was it for many their kind of bank but for some it became a point of first entry to other financial institutions.
  I feel sure that the founding fathers of the Birmingham Municipal bank would be fascinated if they knew how their original idea had grown, matured and succeeded, and had come to this day and this measure that we are debating. I support the Bill enthusiastically.
  6.24 pm
  Mr. Gordon Wilson: Before I develop my main remarks on the Bill, it is worth while putting on record my admiration for the energy and initiative that has led to the rejuvenation of the trustee savings banks. There is no doubt that over a period of years and with a long history they have built up strong local associations and not only perform a useful purpose but provide a service and a loyalty in a locality that is much appreciated.
  It is from that point that I should express the unease that has developed in me as the debate has progressed. That was not allayed by the exchanges I had with the Minister earlier. We are about to pass the point of no return in relation to the trustee savings bank. It has been argued that the main change was occasioned in 1976 under the Act of that year. But the changes that were made then, which were largely useful and gave additional powers and discretion to the management of the trustees savings banks and led to the amalgamations and mergers, are in danger of being wiped out by a complete change in the composition of the bank, which will lead in turn to centralisation.
  When the Minister told me, as if it might be a blandishment that would be of some help, that there would be no diminution in the degree of centalisation if the Bill were passed, my worries were not relieved because there is a great danger of centralisation as a consequence. Prior to the Bill there was a confederal structure, with a central board with autonomous units which co-operated and worked together to make the changes and the image and provide the service to customers that was remarked upon earlier. That will now be encompassed in a new central board with shareholders who, with the directors of the main hoard, will call the tune in future.
  Several years ago we had a great debate on the Royal Bank of Scotland, to which reference has been made. It is probably worth while to put into context some of the
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  points that were made in that debate. It was argued by the Government, among others, that there were advantages in the royal bank being taken over by or merged with other institutions. The argument was set out plainly in The Scotsman on 16 December 1980 in a statement by Mr. Peter Balfour, chairman of the Scottish Council (Development and Industry) who was then a member of the royal bank's board. In an address to the company's annual general meeting he said:
  "In Scotland we are paying the price of the massive and increasing centralisation in London and the South East of the real decision-takers in industry, politics and the trade unions. As a result, the real needs and concerns we all feel in Scotland are becoming more and more remote from the understanding and the thinking of these people."
  A year later in the Financial Times is the statement:
  "The existence of banks controlled in Scotland is possibly one of the factors which has enabled Edinburgh to survive as an important financial centre, with a set of traditions and a financial community independent of those in London."
  It was against that background that we heard assurances from the Minister that there would be no diminution in centralised control—
  Mr. Ian Stewart: I do not recall my exact words when replying to the hon. Gentleman's intervention earlier—I shall say more on the subject when replying to the debate—but to avoid doubt at this stage, I hope that he will appreciate that I was endeavouring to explain that there was already central control. I said that I did not believe that there would be any diminution of local management and independence resulting from the change. It was not the other way round.
  Mr. Wilson: I am grateful for that clarification. Although we have assurances, including ministerial assurances, the reality is that when financial control is expressed in any company it is the majority shareholding that counts. Only if assurances are encompassed in legislation can they achieve any material change. The necessary power must be sought from Parliament.
  The company that was after the royal bank, Standard Chartered bank, through its managing director gave assurances along the lines of those given by the Minister. He said:
  "It is absolutely not our intention"
  to detract from the role of the royal bank
  "but I must add the rider that overall group constraints have to be subject to overall group policy."
  It is clear from the charts on page 7 of the White Paper that what was an effective confederal structure is to be replaced by seven subsidiary companies all under the control of the group company, TSB Group plc. As I said, once the shares have been issued by TSB Group plc, it will become the master.
  Who will have control of the bank's investment policy when it has been restructured? Will it be TSB Group plc or TSB in Scotland? In other words, if there is disagreement within the management structure— for example, about where investment should take place—who will make the final decision? It seems that control will remain with the new board, which will be answerable not to its regional boards, as it might be under a federal structure, but to the shareholders.
  In that context, the letter from Sir John Read on page 13 of the White Paper makes it clear in paragraph 10 where power will lie. He writes:

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  "The shareholders will then have the responsibility of electing the directors at the Group's Annual General Meetings. The individual banks and other companies in the Group will have their own boards, appointed"—
  an important word—
  "by the main board of TSB Group plc, and will include"—
  generously—
  "regional bank representatives, executive directors, and independent directors as at present."
  The qualifications for service will be decided not by the regional boards or communities served by the subsidiary companies but by the main board in London, be it at Milk street or elsewhere. In other words, a bank with a substantial penetration of the Scottish banking market will be removed from discretionary decision-taking in Scotland, and that brings home some of the remarks of Mr. Peter Balfour, to which reference has been made.
  Who will be in charge of marketing, advertising and investment policy? Under the unitary structure which is being imposed on the depositors of the bank, without their consent—their views have not been taken into account, although they may be deemed to be the owners of the reserves and assets of the bank—the decisions will be taken at the centre.
  The structure of the new group is not intended to be completely uniform. As the hon. Member for Glasgow, Maryhill (Mr. Craigen) said, and as I pointed out in an intervention, special arrangements are being made for the Channel Islands and Isle of Man by which the local subsidiary will have 49 per cent. of its shareholding locally, and thus will have a different structure from the other subsidiaries.
  The reason given for the difference is that different taxation laws exist. I agree that different tax regimes exist in those places—they are sometimes debatable, but they exist—and to a degree they have their own laws, though the Isle of Man legal system is based largely on English common law.
  In Scotland, on the other hand, we have a legal system which has many differences from that in the rest of the United Kingdom. That applies to banking and other civil obligations. As the Government have conceded, in consultation with the TSB, that there should be special arrangements for the Channel Islands and the Isle of Man, special arrangements should be made to safeguard the autonomy of the TSB in Scotland. Indeed, if people in the streets of Scotland were told today that the TSB was at present a United Kingdom bank, many of them would disbelieve it. The TSB in Scotland is marketed in those terms, yet the Scottish people will find that it is a figment of their imagination, because the final power will not reside in Scotland.
  A significant 'change is being made because the Bill provides not just for a new structure but for the transfer of assets. Liabilities and obligations are also mentioned. Assets are to be transferred out of a Scottish environment and into the London investment scheme. We in Scotland must face the problem that, although we have a vigorous banking set-up, big brother exists in London, and, unless we are careful, assets in Scotland will be snapped up. We have seen the way in which the joint stock insurance companies, which were extremely active in Scotland at one time, have largely been absorbed by their competitors
  60
  in the south. Only the mutual insurance companies have managed to remain healthy, and they might be considered among the leaders in the insurance business.
  I regard the Bill as dangerous and I am critical of the Labour party over it. Given the problems that the Bill is likely to create and the opposition to it that has been expressed by Labour Members, the least they should have done was table a reasoned amendment. Although the Government have a 140 majority in this House, I urge the Minister to take account of the real worry which I and others, including the hon. Member for Maryhill, have expressed about the autonomy and function of the TSB in Scotland. The Bill should be amended to take account of our special circumstances. In view of the decision of the Monopolies and Mergers Commission over the royal bank takeover, the Bill should be amended to ensure that the TSB's staunch reputation in Scotland is safeguarded, for the bank has a valuable role to play if given a chance.
  6.40 pm
  Sir Hector Monro: I do not intend to take up the detailed arguments of the hon. Member for Dundee, East (Mr. Wilson) but I shall share with him a recognition of the historical origins of the TSB movement. I hope that in future the new organisation will recollect its associations with Scotland. Short of naming local directors, I am sure that the hon. Gentleman and I can make a few valuable suggestions.
  I am hardly a regular member of the group of Finance Committee pundits who talk on these matters and it may seem odd that I am about to say a few words on the Bill. I do so for only one reason, and that is historical. The savings bank movement began in my constituency of Dumfries in 1810. It would be wrong to pass the Bill without a word of tribute to Dr. Henry Duncan, minister of the parish of Ruthwell near Dumfries. Besides being a doctor of divinity, he had some commercial experience as a young man. He began the savings bank movement in 1810 in a small house in the village of Ruthwell. He accepted deposits of a shilling and upwards at a time when the banks would not take less than £10. It should be borne in mind that at that time the average farm worker earned less than £10 a year. They could hardly deposit their savings with other banks in the tiny amounts that Dr. Duncan thought would be valuable in future. The new bank was vital to those who earned especially low wages but who wished to begin saving.
  Dr. Duncan's savings bank began its operations in 1810 and in the first year deposits totalled £151. After four years, they had reached over £1,000. All the deposits were put into a locked box with three padlocks. The box could be opened only if all the three trustees were present with their individual keys. The cash was sent to the British Linen bank at Dumfries, where it earned a rate of interest of 4 per cent. From this humble beginning, the movement spread rapidly to Dumfries. In 1875, it inherited the bank of Ruthwell and only a few weeks ago it joined the royal bank group as the last but one of the independent savings banks in Scotland, leaving only Airdrie on its own. The Annan bank has served the community well in agriculture and commerce over a long period.
  Dr. Duncan masterminded the 1819 Act and assisted in the development of savings banks everywhere. Because of his thrift and foresight itis right to call him a father of the savings bank movement. Besides his restoration of the seventh century Ruthwell cross and his authorship of many

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  books, he was the moderator of the General Assembly of the Church of Scotland. Shortly after that, at the time of the disruption, he fell out with his colleagues and was one of the original members of the free church.
  Moving on many years, to last year, we should recall the death of Andrew Rintoul, who lived near Newtonstewart and who was chairman of the Glasgow savings bank for many years. He was the first chairman of the trustee saving banks central board, the body which was recommended by the Page report. He had a fine record of service to the TSB movement. It is only right on this occasion to recall that my hon. Friend the Member for Galloway and Upper Nithsdale (Mr. Lang) served as a trustee for many years.
  I am glad to record that the TSB movement has taken a close interest in Dr. Duncan. It purchased the old cottage in Ruthwell in 1953 and established a museum there. In 1974 we celebrated the bicentenary of Dr. Duncan's birth. The ceremony was attended by the great-great-grandson of Dr. Duncan. I remember that it took place in the middle of the 1974 general election campaign. It was well worth a few minutes of diversion to attend that memorable commemoration. The museum has been well looked after and I hope that all the financial experts in this place will visit Ruthwell and kneel at the shrine of Dr. Duncan, who began the savings bank movement.
  I wish the Bill well. I hope that Dr. Duncan will smile happily and proudly on the movement which he started, which has such good prospects in future.
  6.45 pm
  Mr. Gerald Bermingham: I begin by telling the hon. Member for Hampstead and Highgate (Sir G. Finsberg) that I told Mr. Speaker that I would be late in contributing to the debate for personal reasons. I assure the hon. Gentleman that I ascertained carefully the content of the speeches that preceded his. I am well aware that the ownership issue is well known throughout the House and the savings bank movement. My reason for speaking in this debate is that I have a great fear about that divide. I am not worried about expanding the services of the TSB movement. Indeed, I welcome that move 100 per cent., and my support for that part of the Bill is wholehearted.
  I have a number of reservations about the way in which the Bill has been brought to the House and they lead me to ask the House to reject it tonight. I have made known my feelings to my colleagues on the Opposition Front Bench. I am aware that the Bill has been considered carefully by the Examiners of the House and that the legality of the Bill has been questioned. If I am treading on ground that has already been covered by others, I make no apology for doing so.
  No one knows where true ownership of the movement lies. We are all aware of the 1817 Act and the Scottish legislation that was introduced in 1835. I am not proposing to enter into a history lesson, but it is clear that those who started the savings movement created a form of banking in which money was put out for certain specific purposes, and as such they became trustees. A trustee is someone who holds on behalf of someone else and not on his own behalf.
  The Treasury has said openly, frankly and rightly that it does not own the trustee savings banks and that this is not a privatisation measure. One is forced to ask who wants the Bill in the form in which it appears before us.
  62
  It is not necessary to ask who wants the services of the trustee savings banks to be expanded, because the answer to that is, "Everybody." Who wants the new TSB group to be a plc? Is that what the depositors want? The fact is that they have not been asked. Do those who will use the expanded services want the new group to be a plc? Again, they have not been asked.
  Who wants the new group to be a plc? Apparently this is the wish of the managers. Why is this? Why do they want to sell off something which they do not own? Why do they want to create a limited company? There has been much argument about neutrality and perhaps that is the only reasonable solution. However, there is a problem. If I am thinking along these lines, and I am merely a lawyer, many more of my kind who are outside this place will be asking the same question. I tempt fortune when I say that the Bill might run into a little trouble with the English courts. If anyone tests the right to sell or to float the trustee savings banks as a public company, I shall not guarantee what the result of the test will be.
  Secondly, why does the management want to sell off the trustee savings banks? Why does it want to raise funds by the sale of shares? If the shares are bought, the management will be on a Telecom-Amersham type of deal. We are talking about assets of £8 billion. There are 6 million depositors and 13 million accounts. The banks are not trapped and bedevilled by many of the problems that face other commercial banks. How will a flotation price be pitched? We have been given no idea about that. How will that be done so that a massive profit is not reaped on the day of flotation for those who are lucky enough to get in on the deal?
  The ordinary citizens will not be the people to get in on this deal. We have seen what happened with British Telecom and Jaguar. We have had the placings, as the City so nicely puts it, and the agreed numbers. We will have that type of change again. We do not even know what the memorandum and articles of association will say. I say to the Economic Secretary in the kindest possible way that all the assurances in the world from him will not be worth anything if they are not written into the legislation. That is the only way in which the provisions can be made to stick. I have sufficient experience as a lawyer to know that memoranda and articles of association can be changed. One need only have the agreement of 51 percent. of the shareholders and their views can be judged by a show of hands or a written poll. I foresee a time when limitations will be written into the memorandum and articles of association restricting a shareholder to 5 per cent. of the equity. It does not take much thought to work out that 11 institutions holding 5 per cent. each of the shares will be able to change the memorandum and articles of association.
  After five years, a shareholder will be able to hold up to 15 per cent. of the shares. We know that shares change hands. Already we have noted that BT shares have moved from the personal sector to institutions. We have seen what happened with Jaguar and Amersham. I foresee that, shortly after flotation, the shares will begin to move.
  The institutions may not need to wait five years before building up to their 15 per cent. stake. Let us face it: a valuable asset will come on to the market. I know that it is to be written into the legislation that priority must be given to depositors and to employees, and that is well and good. What statement will be made stipulating that a certain percentage must not go abroad? We have already

  63
  had the flotation of British Telecom shares in Japan and New York, so we know that this new idea is accepted. What guarantee do we have that the flotation of shares will be limited to this country and that a percentage of shares will not be floated abroad? Flotation provides one of the easiest and quickest ways of enabling a company to enter the English banking sector. Shareholders are thereby able to join a bank that does not have the commercial worries of other major joint stock banks.
  Who has the right to sell shares? Would it not have been much better to create a mutual association? There would then not have been any problems with shareholders and fears of what might happen during the five-year period or afterwards. The Government with their built-in majority may overwhelm the views of my hon. Friends who will support me in opposing the legislation and the Bill may be considered in Committee. I must warn the Government that it is not good enough to introduce a Bill that does not contain a schedule setting out the memorandum and articles of association. It is not good enough to have legislation that does not state that the 5 per cent. and 15 per cent. shareholdings cannot be altered, that the majority of shares must remain in the United Kingdom and that certain factors apply to charitable donations and foundations. I shall not repeat the comments of my hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) on those points. I am always suspicious when I read the throwaway lines in Government papers—for example, the reference in paragraph 14 of Mr. Read's letter to charitable foundations that will hold special shares. We are not told about the terms and conditions applying to that new class of shareholder.
  This badly drafted Bill is based upon a false premise—that one can sell what one does not own. The Bill is unnecessary, because there is no need for this new statutory form of TSB. There is the much better, more acceptable and carefully thought through form—that of mutual foundations. That form should, perhaps have been written in to the 1976 legislation. That was the road we should have taken.
  It is not too late for the Government to think again. For once, the Bill contains nothing for the Government's coffers. The Government can therefore stand back, reappraise the subject in the light of the arguments advanced in the House and return with an expansion of the TSB which is in the TSB's interests. That action would receive the support of the whole House, because all hon. Members are for the enhancement of the service, improvement of its functions and development of the bank. I am sure that the whole country does not support the idea that some people should make a profit from the banks and institutions that belonged to our forefathers.
  6.56 pm
  Mr. Tony Blair: The debate has given rise to certain points. Is this the right way to proceed with the TSBs? That question involves whether the TSBs should have gone mutual or, as the Government have proposed, should have become a public limited company. If the TSB public limited company is the right route to follow, it can be said that we are debating Hamlet without the Prince of Denmark. The vital issues associated with a public limited company concern the allocation of shares and protection from takeovers. Neither of those issues is
  64
  dealt with in the Bill. We have only assurances contained in the letter from Sir John Read to the Chancellor of the Exchequer, which are not binding. It is important to establish the terms of the argument. Are the Government saying, "This is what we always wanted for the TSBs and this is the culmination of that process."? Are they saying, "I know that we want the TSBs to follow a different route but I am afraid that the commercial realities dictate that we cannot do that"? The Government seem to have been saying the latter.
  Undoubtedly, the last 10 years have seen an enormous and extraordinary transformation of the Trustee Savings bank. It has been stated that the Bill is the end of that process of change. That the trustee savings banks should change has never been an issue. The clarification of ownership could provide a sufficient reason for that change to occur. That clarification obviously had to occur. That substantial change has taken place without controversy between the two main parties. It was recognised at all times that a balance had to be maintained between making the Trustee Savings bank able to hold its own and grow in a modern commercial world and preserving the special traditions and character of the trustee savings bank movement. That character involves particularly the strong regional and local participation in and identification with the Trustee Savings bank. The hon. Member for Dundee, East (Mr. Wilson) pointed out how people in Scotland regard the Trustee Savings bank as a Scottish institution. My relations, who have had the good fortune to come from Glasgow, were heavily involved in the Trustee Savings bank. They always regarded that bank as an institution that differed from the ordinary joint stock bank.
  The question is whether that balance between commercial reality and the special traditions of the TSB has been kept. It is not doubted that the Bill will enable the TSB to live comfortably in the real world. The anxiety expressed during the debate is whether its special character will be lost in the process. If it is, we shall not merely have abandoned the legacy of the past, we shall have failed to take an opportunity to provide a different vision for our banking system in future. We value the TSBs for sentimental reasons and because, at best, they have symbolised the notion of community banking.
  Two parallel movements have taken place during the past 10 years. First is the extension of the services of the TSBs and the second is the reorganisation of the TSBs, which was partly a centralisation process and partly an attempt to allow the TSBs to function more efficiently and without Government constraints. It is extraordinary to think that when the Page committee reported there were still about 70 different associations.
  The Page committee acknowledged the need for the TSB to become tighter as an organisation and progress to a range of banking services for customers, especially lending. It is true, however, that the Page committee envisaged that lending should be to the ordinary public rather than corporate lending.
  I must inform the hon. Member for Ludlow (Mr. Cockeram) that the movement from the Page committee was not initiated by the Labour party. It is best illustrated by the Bill. It is right to say that the Bill is inconsistent with the Page committee in its original intentions.
  Mr. Cockeram: Will the hon. Gentleman accept my point that although the Page committee was set up by and

  65
  reported to a Conservative Chancellor, it fell to the subsequent Labour Chancellor to announce the then Government's decision because of the short lapse of time between the two events? The then Chancellor, the right hon. Member for Leeds, East (Mr. Healey), accepted the recommendations of the Committee. To that extent, does the hon. Gentleman not agree that there was a bipartisan approach to the reform of the national savings movement, which was the core of the issue put to the Page committee?
  Mr. Blair: That is right. However, it is worth emphasising that the Page committee and the Labour Government believed that if the TSB was to develop, it should be in the direction of mutual banking. That was made plain.
  My point is that, although the 1976 legislation was introduced without opposition, the consensus on all sides of the House was that the TSB would develop along the lines of a mutual bank. The importance of developing in that way was put clearly by both the Paymaster General in 1976, who moved the Second Reading of the Trustee Savings Banks Bill, and by my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon). The TSB was to become what was called a third force in banking and was to be a different form of banking from that of the clearing banks.
  The concept of the TSB as a third force in banking survived much of the structural, economic and commercial changes that took place in the TSB during the 1970s and early 1980s. The Government's view is that at one time there was a consensus that the TSB should progress through mutual banking, but that changes in commercial reality make that no longer a sensible option. There were significant changes in the commercial operations of the TSB, yet the concept of mutual banking survived.
  The attitude of the management of the TSB changed in mid-1928. Until 1982 the TSB was always supposed to be in favour of moving in the direction of mutual banking. On Second Reading of the Trustee Savings Banks Bill in 1976 the Economic Secretary made it clear that corporate lending would create great dangers and that the personal customer service was ideal for trustee savings banks.
  In 1978, when the TSB management submitted evidence to the Wilson committee, which was set up to review the function of financial institutions, it continually stressed the need for a third force in banking. The idea was alive then. It is clear from press reports between 1979 and 1981 that the idea then was that the TSB would become the third force in banking and a mutual bank.
  For many reasons, the desire was to preserve the special traditions and character of the TSBs. I wish to emphasise the reasons why it was thought so important for the TSB to become the third force in banking and to be a mutual bank. First, the banks catered for the small depositor and the family—those who were otherwise unbanked within the system. That was true when it was established in the early 19th century and it remains true today. That feeling was reinforced by the fact that for many years, and to an extent today, the TSB has been an arm of national savings. The hon. Member for Hampstead and Highgate (Sir G. Finsberg) pointed out that successive Governments took a lot from the TSBs. The case for the TSB being kept under the control of its depositors is strengthened by that degree of Government involvement and by the slightly parasitic relationship between the Government and the TSBs.
  66
  Although I agree that it is clear that depositors do not own the TSB, their rights are quasi-proprietorial because of the traditions, and the relationship with the national savings movement. A point that has not been made, and should be made by the Conservative party, is that if the Government were truly committed to a wide share ownership or to wide participation of people in our institutions, the mutual banking route would be better than the plc route. In a mutual bank there would not be ownership of shares but there would be participation in accordance with the traditions of the TSBs.
  The responsibilities to the traditions of the TSB are still acknowledged by its management today. It makes it clear in advocating the plc route that it realises that the traditions must be upheld. It has been put to the TSB that it is better to become a public limited company because it can raise money more easily and is accountable to shareholders. I understand that there has been no process of formal or informal consultations between depositors and the TSB management about the right route for the TSB. That is a weakness. A curiosity arising from the uncertainty of ownership is that it makes it more difficult to say who should be involved in what happens to the TSB It would be wrong if the uncertainty resulted in depriving depositors of the right to participate in the consultation process.
  The concept of the TSB as a third force in banking has been all but dropped from either the White Paper or the Bill, and the only protection that depositors have—this worries us considerably—is not in the Bill but in the letter from the chairman of the TSB to the Chancellor of the Exchequer. Indeed, the Bill in a sense is really an enabling measure; it vests the property in the plc and allows it to float shares, but it does not itself deal with the requirements that are necessary to ensure that the character of the TSB is observed. As far as I can see, that is left exclusively to the TSB management to determine.
  Two essential points arise. First, there is the question of share allocation. There is absolutely no way at this stage of judging what allocation of shares there will be to the depositors or to the employees. The hon. Member for Solihull (Mr. Taylor) spoke of the need for wide ownership. We simply do not know how many shares depositors will have. There is no indication— the Minister may say that there is—whether any thought has been given to the number of shares that depositors or employees can expect.
  The hon. Member for Hampstead and Highgate suggested that my hon. Friend the Member for Thurrock (Dr. McDonald) was wrong in saying that as many as 40 per cent. would not be able to take up shares. He made the point—it is a fair one in a sense—that there are many people who may not have much money in the TSB but may have money in other accounts. But that is to say that there may be fewer than 40 per cent. who cannot take up shares; in other words, there may be a very high proportion of depositors who want to take up shares. If we are to judge the measure properly, we should be told what figure is in mind for depositors. That is crucial to the spreading of share ownership.
  With regard to takeovers, 5 per cent. for five years is the greatest amount permitted, but that is still considerable. It could still mean that large numbers of depositors could not get the opportunity to own shares. After five years the figure is to be fixed at 15 per cent., but that is only in the articles of association, and there would be no great difficulty about changing it.

  67
  My hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) eloquently explained the attractiveness of TSB, and I doubt whether many people will wrestle with their consciences, in the way that he did, about buying. The plain fact is that there is no guarantee that, after a five-year period, there could not be a substantial change in the nature of the TSB.
  The Minister should tell us the basis upon which the matter is being put. If it is being said that it is no longer possible to have the notion of a third force in banking, or to go down the road of mutuality, we can judge the argument on those terms. But it is wrong for the Government to protest that this is merely the end of a foreseeable process when what has taken place is a considerable change of course. I should like to know specifically from the Minister why the Bill, even if it goes down the plc route, cannot contain adequate safeguards to ensure that the tradition and character of the TSB is observed. If that does not happen, whatever the rhetoric from Government or management, the reality will be substantially different.
  7.14 pm
  Mr. Ian Stewart: By leave of the House, Mr. Speaker, I hope that I may have an opportunity of responding to the debate.
  Before dealing with the general questions which have been raised, I should like to mention quickly one or two practical questions which were put to me. The hon. Member for St. Helens, South (Mr. Bermingham) referred to the memorandum and articles. They are available in the Library. I do not at this stage want to enter into a debate with him about company law, but my understanding is that special resolutions, which are usually required for changes in articles, are likely to need a higher percentage of support than he suggested.
  The hon. Member for Dundee, East (Mr. Wilson) raised with me in an intervention, and also in his speech, the question of possible direct shareholding in TSB (Scotland). I said that I would come back to that. It embodies a principle as well as the point that the hon. Gentleman raised. The local shareholding which it is proposed to make available in TSB (Channel Islands) is not provided for in the Bill. It is a proposal which the TSBs have put forward under their own powers. It would not be appropriate to insert a statutory requirement in the Bill itself either for or against such a thing. It would have been possible, if TSB (Scotland) had wanted to have such an arrangement— I imagine after discussion with other members of the TSB group— to put forward a suggestion that TSB (Scotland), or any of the other TSBs, should have that degree of independent shareholding. That is not the way in which the proposals have come forward, and far be if from me to suggest that they should do so in that way.
  The hon. Gentleman also spoke about control. The structure of the group will be different. The holding company will be at the top rather than in the middle, as shown by page 7 of the White Paper. The top company will be a holding company and not a banking company. The banking, as I understand it, will be controlled by the boards of the four main banks, and the other business within the group will be controlled by the boards of the companies which do that particular business.
  Mr. Gordon Wilson: I do not see any reason why, in the public interest, we should not insert certain provisions, whether the TSBs like it or not. The Minister says that the banking operations will be carried out by the subsidiary companies. Who will have control of the assets of those subsidiary companies? At the end of the day, will it not be the holding company, comprising the shareholders, which will have the right to say yea or nay with regard to disposal of the assets?
  Mr. Stewart: The technical position would be the same as with any holding company and group, but in the case of the TSB group, as with many other quoted companies, the operating subsidiaries generally run their business, and not the holding companies which happen to be parent companies of the group. Clearly, the TSBs themselves have seen the need for a form of co-ordination of their activities, and that is reflected in the existing structure. I tried to explain earlier that there is a change in the structure, but it is not as if there is no central function as things now stand. The proposals have been worked out both by the individual TSBs and by the centre.
  The hon. Member for Thurrock (Dr. McDonald) asked me at the outset of her speech about the timing of the flotation. I understand that the TSBs hope that it can take place by about next winter. It is not for the Government to determine. The vesting is a formality which must take place before the decision for the issue itself. That depends on several factors such as market conditions, the date of publication of accounts for quotation in a prospectus, and so on. Those are matters that the TSBs themselves will be able to settle.
  I should like to refer briefly to the main issues that have been developed during the debate, because they are fundamental. I shall try to cover the main points that were raised by Opposition Members as well as my hon. Friends.
  There is an oddity about the Bill, which presents some difficulties to me and the House. I readily admit that, because it is inherent in the situation. If the TSBs were already Companies Act companies in the private sector, if they were part of the banking group in that form, and wanted such a reorganisation, they would come to the House with a private Bill. They would be answerable for the way in which they had approached the House, and it would not be a Minister standing at the Dispatch Box who would tell them how to do it. At the other end of the reorganisation are the Government's existing responsibilities, laid down by a century and more of legislation on the statutory structure and powers of the TSB movement. Apart from the vexed question of ownership, to which I shall refer, the Government have responsibility for supervision, taxation and constraints—in this case, the removal of constraints on the ability of the TSBs to undertake an increased range of business.
  Therefore, there is a Government interest. It is not, as has been frequently said during the debate, a Government financial interest. The Government are disinterested in that respect. They are disinterested in the issue, in that aspect of the future of the TSBs— and properly so. It was suggested that the Government might consider taking the resources of the TSBs into their own hands. That has never been the intention of the Government or of any of the proposals that have been considered. The idea is to allow the TSBs to develop in the way that those responsible for them have come to the conclusion is the best way forward in today's conditions.

  69
  Clearly, that raises several points of principle. I have been asked by many hon. Members about the Government's attitude to the recommendations in the Page report on the third force in banking. The right hon. Member for Ashton-under-Lyne (Mr. Sheldon) and other hon. Members referred to the local commitment and regional identity of the TSBs. Whatever may have been the position in 1973 or even when the 1976 Act was before the House, the Government and I and the TSBs do not believe that the mutual structure would be appropriate, either for today or for the future. It is important that we look forward and not backward in making our provisions for the TSBs in future.
  I mentioned immediate practical considerations that have weighed substantially with the TSBs and the Government in considering the matter. Direct accountability is very important for those who are competing in the commercial environment of the retail banking sector today. Direct account-ability to shareholders will be given through boards of directors and the holding company structure in a clear-cut way that will allow decisions to be taken that are in the commercial interests of the TSBs, and, in that sense, in the commercial interests of the depositors.
  I have a strong personal concern that the depositors with the TSBs should feel that there is a continuing identity with the TSBs between themselves and the banks they use. I support the proposals by the TSBs that regional boards should continue and that there should be charitable foundations with favourable proposals for local interests. I support the idea that the depositors and the staff, who are by definition depositors, should have substantial priority.
  The hon. Member for Sedgefield (Mr. Blair) raised a fair question when he asked about the Government's attitude to that. He asked about the Government's choice. A pattern has been worked out through discussion between the Government and the TSBs as to what is best for their own future. I do not come to the Dispatch Box to propose legislation for the TSBs that is not in their best interest. I hope and believe that a large number of depositors will apply successfully for shares.
  I have been asked about the number of shares, the scale of priority, the terms of the issue and so on. Those are not matters that the Government can resolve or decide. I realise that that presents a dilemma. It is an enabling Bill. It allows a process to continue and be completed that has been fully explained in Sir John Read's letter, which is in the White Paper. However, if hon. Members are anxious to learn more specifically about the proposals that it will be the responsibility of the TSBs to carry through, through the TSB parliamentary group or another means of communication, Sir John Read, members of the central board and other representatives of the TSBs may want to take into account what has been said during the debate and in Committee and respond so far as they can to the questions that have been raised.
  I have considered carefully what my position would be if I were asked such questions, because it has occurred to me that the House might be interested in some of those details, as I am, but I cannot take such decisions for the TSBs. The details of the flotation will have to be worked out by the TSBs with their advisers, the Stock Exchange and so on. It should not be Parliament that makes those decisions. It should not be Ministers, even a Minister as well disposed to the TSBs as I am. Parliament must
  70
  provide the framework in which the change can take place, and the matters must then be resolved by the TSBs themselves.
  Mr. Blair: Is not this the problem? Because of the uncertainty of ownership, when one talks about the TSBs advocating a certain course of action, all that one can refer to is the TSB management. In a sense, the depositors are a casualty of the uncertainty of ownership. The question that the Minister must answer to satisfy people is this. Why was not some attempt made to ascertain the views of the depositors? Unless the Government stand up for the depositors, they have no one else to turn to.
  Mr. Stewart: I was going to refer to ownership. I shall do so now. Rather than answering the hon. Gentleman's specific question, I shall make some comments that cover the points that he made.
  There is not just uncertain ownership; there is a lack of ownership of the TSBs. Parliament must resolve that problem. It is true that a mutual ownership could have been chosen, but I do not believe that that is right, and those who are responsible for the business of the TSBs also do not believe that that is right. Then there is the question of consultation. Again, there is a problem with the constitutional position. There is no formal means, and no easy informal means, of ascertaining the relative interests of those who are party to the TSBs in one form or another. There are trustees, managers, staff and depositors, so far as one can have access to them in this respect.
  The proposals in the chairman's statement in 1982 received a good deal of publicity at the time, both generally and within the group, but I understand that there was very little reaction and that no strong case was put forward in favour of mutual ownership rather than the structure proposed. Whatever might have seemed sensible to Sir Harry Page in the early 1970s, it is simply not practical in today's conditions if one wishes this group of banks to be able to hold its own competitively with the four clearing banks.
  As for the "third force", one cannot describe the market in such simple terms as one could 10 or more years ago. The barriers of function in banking, instalment credit, and so on have been considerably broken down and the financial institutions in retail banking can no longer be parcelled out into three separate groups— clearing banks, National Giro and TSB— each with a different constitution. I hope that in some respects the clearing banks will become more like the TSB rather than vice versa, because the TSB's great tradition of attention to the needs of customers is important commercially as well as historically as an element which is becoming increasingly important to customers of banking services today.
  The question of consultation is thus linked with the lack of ownership. Until 1976, if a TSB closed down the surplus went into what was known as a "closed banks fund", showing that no one knew where to look in terms of ownership. The management and central board of the TSB have taken great care to consider all these matters within the movement before putting their proposals to us and I believe that those proposals constitute an appropriate way forward. We feel that we should support, as it were, the private Bill element in this by creating enabling legislation to deal with those aspects which remain the responsibility of Government.
  Mr. Robert Sheldon: The Minister has not dealt with the 5 per cent. limit on ownership and the fact that after five years it will be possible to apply for and obtain, by takeover or other means, 15 per cent. of the shares. The Minister has said that the memorandum and articles of association will deal with that. Will he accept an amendment to enshrine the limit in the legislation so that it will not be possible for anyone to obtain a greater proportion in the future?
  Mr. Stewart: I do not think that it would be appropriate for the legislation itself to include specific provisions about the flotation or about the subsequent conduct of the TSB as a private sector company. I take the point that the 5 per cent. limit in the memorandum will expire after five years, followed by a provision in the articles restricting any single shareholding to 15 per cent. We are talking about a time a considerable way off and we must not forget that legislation relating to the structure of financial institutions has been shown in recent years to become out of date very quickly. Enshrining in statute specific requirements on that or various other aspects, thus setting the TSBs apart from other banks for an unlimited period until Parliament decided to change it, would not in my view be in the best interests of the TSBs. I am therefore not persuaded by the right hon. Gentleman's argument.
  I believe that the overall purpose of the Bill is helpful to the TSB and its depositors, and I hope that the House will give it a fair wind today.
  Question put, That the Bill be now read a Second time:—
  The House divided: Ayes 204, Noes 37.

  Division No. 61]

  [7.35 pm

  AYES

  Alexander, Richard

  Chapman, Sydney

  Amess, David

  Chope, Christopher

  Ancram, Michael

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

  Arnold, Tom

  Clark, Dr Michael (Rockford)

  Atkins, Robert (South Ribble)

  Clarke, Rt Hon K. (Rushcliffe)

  Atkinson, David (B'm'th E)

  Clegg, Sir Walter

  Baker, Nicholas (N Dorset)

  Cockeram, Eric

  Baldry, Tony

  Colvin, Michael

  Beaumont-Dark, Anthony

  Coombs, Simon

  Bellingham, Henry

  Cope, John

  Bennett, Sir Frederic (T'bay)

  Cormack, Patrick

  Best, Keith

  Couchman, James

  Bevan, David Gilroy

  Cranborne, Viscount

  Biggs-Davison, Sir John

  Currie, Mrs Edwina

  Blackburn, John

  Dicks, Terry

  Boscawen, Hon Robert

  Dorrell, Stephen

  Bottomley, Peter

  Douglas-Hamilton, Lord J.

  Bottomley, Mrs Virginia

  Dover, Den

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

  Dunn, Robert

  Bowden, Gerald (Dulwich)

  Durant, Tony

  Brandon-Bravo, Martin

  Dykes, Hugh

  Bright, Graham

  Edwards, Rt Hon N. (P'broke)

  Brinton, Tim

  Eggar, Tim

  Brooke, Hon Peter

  Evennett, David

  Brown, M. (Brigg & Cl'thpes)

  Eyre, Sir Reginald

  Browne, John

  Fairbairn, Nicholas

  Bruinvels, Peter

  Fallon, Michael

  Buck, Sir Antony

  Favell, Anthony

  Budgen, Nick

  Fenner, Mrs Peggy

  Bulmer, Esmond

  Finsberg, Sir Geoffrey

  Burt, Alistair

  Fletcher, Alexander

  Butcher, John

  Fowler, Rt Hon Norman

  Butterfill, John

  Fox, Marcus

  Carlisle, John (N Luton)

  Franks, Cecil

  Carlisle, Kenneth (Lincoln)

  Fraser, Peter (Angus East)

  Carlisle, Rt Hon M. (W'ton S)

  Freeman, Roger

  Chalker, Mrs Lynda

  Gale, Roger

  Channon, Rt Hon Paul

  Gardiner, George (Reigate)

  72

  Garel-Jones, Tristan

  Pym, Rt Hon Francis

  Gower, Sir Raymond

  Raffan, Keith

  Greenway, Harry

  Rathbone, Tim

  Gregory, Conal

  Renton, Tim

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

  Rhodes James, Robert

  Gummer, John Selwyn

  Rhys Williams, Sir Brandon

  Hamilton, Hon A. (Epsom)

  Roberts, Wyn (Conwy)

  Hamilton, Neil (Tatton)

  Robinson, Mark (N'port W)

  Hawkins, C. (High Peak)

  Roe, Mrs Marion

  Hayward, Robert

  Rowe, Andrew

  Henderson, Barry

  Ryder, Richard

  Higgins, Rt Hon Terence L.

  Sackville, Hon Thomas

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

  Sainsbury, Hon Timothy

  Howarth, Gerald (Cannock)

  Sayeed, Jonathan

  Hunter, Andrew

  Shaw, Giles (Pudsey)

  Johnson Smith, Sir Geoffrey

  Shaw, Sir Michael (Scarb')

  Kilfedder, James A.

  Shepherd, Colin (Hereford)

  Knight, Mrs Jill (Edgbaston)

  Shersby, Michael

  Lang, Ian

  Sims, Roger

  Lawrence, Ivan

  Skeet, T. H. H.

  Lee, John (Pendle)

  Smith, Tim (Beaconsfield)

  Leigh, Edward (Gainsbor'gh)

  Soames, Hon Nicholas

  Lennox-Boyd, Hon Mark

  Speed, Keith

  Lightbown, David

  Speller, Tony

  Lord, Michael

  Spencer, Derek

  McCrindle, Robert

  Spicer, Jim (W Dorset)

  Macfarlane, Neil

  Stanbrook, Ivor

  MacKay, Andrew (Berkshire)

  Steen, Anthony

  MacKay, John (Argyll & Bute)

  Stern, Michael

  Maclean, David John

  Stevens, Lewis (Nuneaton)

  Major, John

  Stevens, Martin (Fulham)

  Malins, Humfrey

  Stewart, Allan (Eastwood)

  Malone, Gerald

  Stewart, Andrew (Sherwood)

  Mates, Michael

  Stewart, Ian (N Hertf'dshire)

  Maude, Hon Francis

  Stradling Thomas, J.

  Maxwell-Hyslop, Robin

  Sumberg, David

  Mayhew, Sir Patrick

  Taylor, John (Solihull)

  Merchant, Piers

  Taylor, Teddy (S'end E)

  Meyer, Sir Anthony

  Tebbit, Rt Hon Norman

  Miller, Hal (B'grove)

  Thompson, Donald (Calder V)

  Mills, Iain (Meriden)

  Thompson, Patrick (N'ich N)

  Mills, Sir Peter (West Devon)

  Thorne, Neil (Ilford S)

  Miscampbell, Norman

  Thurnham, Peter

  Mitchell, David (NW Hants)

  Tracey, Richard

  Monro, Sir Hector

  Twinn, Dr Ian

  Montgomery, Fergus

  van Straubenzee, Sir W.

  Moore, John

  Viggers, Peter

  Morrison, Hon C. (Devizes)

  Waddington, David

  Morrison, Hon P. (Chester)

  Walden, George

  Moynihan, Hon C.

  Waller, Gary

  Mudd, David

  Warren, Kenneth

  Neale, Gerrard

  Watson, John

  Norris, Steven

  Watts, John

  Onslow, Cranley

  Wells, Sir John (Maidstone)

  Oppenheim, Phillip

  Wheeler, John

  Osborn, Sir John

  Whitney, Raymond

  Ottaway, Richard

  Wiggin, Jerry

  Page, Sir John (Harrow W)

  Wolfson, Mark

  Page, Richard (Herts SW)

  Wood, Timothy

  Parris, Matthew

  Woodcock, Michael

  Peacock, Mrs Elizabeth

  Yeo, Tim

  Percival, Rt Hon Sir Ian

  Young, Sir George (Acton)

  Porter, Barry

  Portillo, Michael

  Tellers for the Ayes:

  Powell, William (Corby)

  Mr. Michael Neubert and

  Powley, John

  Mr. Peter Lloyd.

  Proctor, K. Harvey

  NOES

  Atkinson, N. (Tottenham)

  Fatchett, Derek

  Barron, Kevin

  Fields, T. (L'pool Broad Gn)

  Beith, A. J.

  George, Bruce

  Bidwell, Sydney

  Godman, Dr Norman

  Boyes, Roland

  Howells, Geraint

  Caborn, Richard

  Hoyle, Douglas

  Clwyd, Mrs Ann

  Lamond, James

  Cox, Thomas (Tooting)

  Maynard, Miss Joan

  Craigen, J. M.

  Meadowcroft, Michael

  Dalyell, Tam

  Michie, William

  Dixon, Donald

  Mikardo, Ian

  73

  Miller, Dr M. S. (E Kilbride)

  Wareing, Robert

  Nellist, David

  Welsh, Michael

  Patchett, Terry

  Wigley, Dafydd

  Pavitt, Laurie

  Wilson, Gordon

  Powell, Raymond (Ogmore)

  Winnick, David

  Sheldon, Rt Hon R.

  Skinner, Dennis

  Tellers for the Noes:

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

  Mr. Gerald Bermingham and

  Spearing, Nigel

  Mr. Peter Pike.

  Stewart, Rt Hon D. (W Isles)

  Question accordingly agreed to.

  Water (Fluoridation) Bill
  Order for Second Reading read.
  7.46 pm
  The Minister for Health (Mr. Kenneth Clarke): I beg to move, That the Bill be now read a Second time.
  The Bill is seen by the Government as a valuable measure of preventive medicine of some significance for the dental health of many children in this country. On the other hand, the Bill does not break any dramatic new ground. It clarifies the law to enable the existing practice to continue in some parts of England and the former practice to be resumed in Scotland. I refer to the practice whereby fluoride is added to the water in some parts of the country at local option. The practice has proved valuable in reducing the amount of dental decay among children.
  I propose, first, to explain why we need to introduce such a Bill when there has been a long-standing policy on fluoride in this country and, until recently, in Scotland. Secondly, I propose to deal with the health and safety issues connected with water fluoridation. In view of some controversy in medical and scientific circles, the concern about some of these matters is understandable. Finally, I shall refer briefly to individual liberty and the role of the Government. I know that many hon. Members, including some of my hon. Friends, are concerned about those matters.
  The need for the Bill arises from Lord Jauncey's judgment, in the Strathclyde fluoridation court case, delivered on 29 June 1983. Hon. Members may recall that the case was brought by a Mrs. McColl, a lady living in Glasgow, who sought to prevent Strathclyde regional council from carrying out its intention progressively to fluoridate the water supplies for which, as the statutory water authority, it was responsible. The case lasted for over 200 days, and its length made Scottish legal history. Much of the public hearing was devoted to discussion of the safety of water fluoridation, and a large number of expert witnesses were called, including almost ail the leading anti-fluoridationists.
  It is my intention to cover safety issues in more detail later in my speech, but Lord Jauncey's finding on the safety issue was:
  "there is no evidence to suggest that fluoride at the proposed level would have an adverse effect upon health".
  Having heard a great mass of evidence and the most sustained arguments before an objective arbiter— a judge in a court of law—that there have ever been in this country, Lord Jauncey rejected all the petitioner's contentions that fluoridation was hazardous and confirmed that the fluoridation of water supplies would be likely to reduce considerably the incidence of caries— dental decay—in Strathclyde.
  Lord Jauncey accepted, however, that fluoridation was legally ultra vires in Scotland, because it went beyond the legal powers of Strathclyde regional council under Scottish water legislation. The case turned on the question whether the duty of the council to provide "wholesome water" provided the legal power for fluoridation. Lord Jauncey accepted that fluoridated water was wholesome in the sense that
  "it is neither contaminated nor in any other way dangerous to health",
  but concluded that fluoridation was legally ultra vires in the narrower sense that it

  75
  "did not facilitate the supply of wholesome water, nor was it incidental to it".
  Mr. Keith Best (Ynys Môn): Is it not a fact that Lord Jauncey in his judgment said that, when used for the purpose of preventing tooth decay, the addition of fluoride to the water represented a medicinal product? As such, would my right hon. and learned Friend agree that it would come within the Medicines Act?
  Mr. Clarke: I do not recall that passage in Lord Jauncey's judgment. I have quoted his conclusions on the safety issue and the legal issue whether the existing statutory powers of the regional council cover the addition of fluoride. At the moment, fluoride is not regarded as a medicinal product by the licensing authority. Fluoride is a mineral that, when added to water, has these particular consequences; and it is a wholly separate issue as to whether it is a medicinal product and requires licensing under the Medicines Act. I shall pursue the point further if my hon. Friend wishes, but, on the strength of the evidence that I shall be citing in the course of my speech and of the body of evidence looked at by Lord Jauncey, there would not be any difficulty in obtaining a licence if it were established that fluoride is a medicine and requires a licence.
  Following Lord Jauncey's opinion, the Government took immediate action to comply, and fluoridation ceased in Scotland. Fluoridation has, however, continued elsewhere in the United Kingdom, as Lord Jauncey's judgment is not binding outside Scotland. Although the Water Acts, as they apply in England and Wales, are similarly worded to the Scottish Acts, it does not follow that Lord Jauncey's view would necessarily be upheld by the courts south of the border. Unfortunately, doubt is now established because of the Scottish judgment.
  The Government announced on 6 December 1983 that it was our intention, when the parliamentary timetable permitted, to bring forward legislation which could clarify the power of water authorities in Scotland to add fluoride to the water supply on the recommendation of the appropriate health boards. Since there was doubt over the legal powers of water authorities elsewhere in the United Kingdom to fluoridate, we announced that we also proposed that the legislation should cover all statutory water undertakers in England and Wales and that corresponding legislation should be enacted for Northern Ireland. That is still our intention, and the Bill reflects this.
  I shall now address the basic question of the need and the case for water fluoridation as a measure of preventive medicine, which I began by describing. I hope that the House will be prepared to accept that dental decay constitutes a serious health problem which needs to be addressed. Although there has been a welcome reduction in dental decay over the past 10 years, it remains a significant and costly form of disease, which is particularly subject to regional variation. To illustrate this I shall quote from the 1983 child dental health survey, which showed that, for example, among 13-year-olds, 64 per cent. of children from Northern Ireland had active decay of the permanent dentition, 51 per cent. from Scotland, 40 per cent. from Wales and 31 per cent. from England.
  Water fluoridation is not, of course, the only means of reducing dental decay, but it does have particular
  76
  advantages over other methods, which I shall briefly explain. Improvements in dental health can undoubtedly be brought about by improvements in diet and oral hygiene, and it is our policy as a Government to encourage dental health education through the Health Education Council and the community dental services. At the same time, we have to recognise that there are limits to what can be achieved by this method alone. For this reason, we believe that it is important to encourage other forms of preventive dental treatment involving the use of fluoride supplements. There are a number of means of providing fluoride supplementation, such as toothpaste, tablets and what is called topical application directly on to the tooth. These are certainly valuable methods of preventing tooth decay, and much of the recent general reduction in dental decay is thought to be related to the use of fluoridated toothpaste.
  Fluoride tablets and topical application of fluoride are of value, particularly in those areas where fluoride is not added to water, but they are a relatively expensive means of reducing dental decay. The use of fluoride tablets also requires the following of a regular regime, and experience has shown that that is not always easy for parents to maintain. Topical fluoride requires administration by trained staff. All the other methods—better diet, oral hygiene and tablets—are followed by only a certain proportion of the population, and by no means all.
  Water flurodiation has advantages over all these methods in that it is highly cost-effective, does not require the use of trained personnel or conscious effort by the recipient and confers a benefit on the whole of a given community.
  Dr. M. S. Miller: I am in favour of what the right hon. and learned Gentleman is saying about the advantages of fluoride added to water. However, to complete the record, will he also mention the fact that fluoride can be and is being added to milk by an organisation run by a philanthropist in the south of England? That shows that there is another way to introduce fluoride into the system, although it is not as good a method as fluoride in the water.
  Mr. Clarke: I am grateful to the hon. Gentleman for adding that example of another way in which fluoride can be given in the appropiate quantities to those who want it. I am glad that he agrees with me that all these specific methods do not reach all the population, and water fluoridation has advantages over all of them and is much more comprehensive in its effects.
  I am aware that doubts have been raised in some quarters as to the effectiveness of water fluoridation. Lord Jauncey, in the Strathclyde case, considered the main studies that had been carried out on the effectiveness of fluoridation and concluded that, whatever inperfections individual studies might have,
  "the message is nevertheless loud and clear from many different parts of the world. Water fluoridated to one part per million substantially reduces the incidence of caries. With evidence such as this available it is not surprising that the majority of the dental profession in the United Kingdom favours the fluoridation of water supplies".
  Lord Jauncey also considered and rejected the theories that fluoridation only delays the incidence of caries and can lead to the delayed eruption of teeth.
  In this country, that evidence about the effectiveness and safety of fluoride has been followed for years in some areas. About 5 million people, including my family, drink

  77
  water where the fluoride content has been artificially increased to the optimum recommended level of one part per million. Successive surveys have shown that dental decay levels among children who have had lifelong exposure to fluoridation are consistently lower than among children in comparable non-fluoridation areas. There is ample evidence that the fluoridation of water results in a markedly greater reduction in dental decay than simply the use of fluoridated toothpaste or other dental health measures.
  The House may be interested to know, to add to my point about the experience that we now have, that fluoridation is carried out in more han 40 countries in five continents, and that more than 200 million people worldwide receive artificially fluoridated water.
  Mrs. Jill Knight: Am I right in assuming that the water that my right hon. and learned Friend spoke of his family drinking is in the Birmingham area? Is he aware that the Birmingham dental hospital has no cases of caries among children and that when students are required to look at caries in children, as a result of the fluoridation programme, children from outside the Birmingham area have to be brought in.
  Mr. Clarke: I am grateful to my hon. Friend for that information. Comparisons of the incidence of dental caries among children in my hon. Friend's part of the country— Birmingham— and in other comparable areas have shown that the incidence of dental caries is lower among children in Birmingham. There might be some reaction in Birmingham if people were told that fluoridation had to be withdrawn from the water because the House had failed to pass the necessary legislation. I accept, as I am sure my hon. Friend does, that it is not sufficient simply to prove that fluoridation reduces dental decay for it to be accepted as a public health measure.
  All those who advocate the adding of fluoride to water are just as concerned as the opponents about public safety, and safety always has been, and will remain, a primary concern. During the 1970s the safety of fluoridation was reviewed repeatedly by national and international bodies, such as the World Health Organisation, the Canadian Public Health Association, the United States National Academy of Sciences, the Australian Health and Medical Research Council, and in this country by the Royal College of Physicians. All those bodies concluded in published reports that fluoridation represents a safe means of reducing dental decay.
  Therefore, I hope that the House will forgive me if I do not today go through all the arguments that have been made about all the ailments which at some time or another have been attributed to fluoride, and seek to set out the scientific case that has refuted those claims. Fluoride has been blamed for the increased incidence of many ailments, ranging from cot deaths to AIDS. The House will perhaps understand how curious some of the more fringe claims have been when I say that the evidence on AIDS appeared to derive solely from the fact that water in San Francisco has fluoride added to it as a dental measure. It now appears that other causes exist for AIDS being prevalent in that city.
  However, I accept that serious people have challenged the use of fluoride. Where detailed, assessable evidence is put forward that fluoridation is unsafe, it is extremely important that the Government and my Department should
  78
  examine carefully all the evidence and make known their conclusions. For that reason, I wish to address tonight in more detail some of the more serious problems that have been raised, especially the allegations that have been made for some years that fluoridation can cause cancer in man, together with recent reports from a laboratory in Japan concerning short-term tests of fluoride for mutagenicity.
  Mr. Donald Stewart: Is the Minister aware that, even if one accepted that fluoride is entirely safe, some of us would still be opposed to it on the principle that we cannot accept compulsory medication?
  Mr. Clarke: I shall deal with that point at the end of my speech. There are doubts— it would clarify the debate if we narrowed the issue to that— about the effectiveness of fluoride, but the scientific case is overwhelmingly against them. Some silly claims, and some serious ones, have been made about the safety of fluoride. It is important to set out all the evidence to reassure the public that the overwhelming balance of evidence is that fluoride is safe. Then we are left with the serious issue which I know worries the right hon. Gentleman and some others, and which I hope to address at the end of my speech. I must first try to dispose of the safety arguments.
  To take first the alleged link with cancer, the principal evidence for such a link has been presented by two American scientists, Dr. Burk and Dr. Yiamouyiannis, who since 1975 have claimed repeatedly that cancer mortality in the United States has increased as a result of fluoridation. Their claim is based on statistical comparisons of cancer death rates in fluoridated and non-fluoridated cities. The data in support of the allegation have been considered by other scientists here and elsewhere and have by no means received general credence, with many criticisms being levelled at the methodology employed by those two doctors.
  My hon. Friend the Member for Reading, East (Sir G. Vaughan), when he was Minister for Health, established an expert committee, initially under the chairmanship of Professor Alderson, and subsequently Professor Knox, with the terms of reference:
  "to reappraise the published and otherwise available data and conclusions on cancer incidence and mortality amongst populations whose drinking water is either artificially fluoridated or contains high levels of fluoride from natural sources."
  The report of that committee was published today, and copies are available in the House. After detailed consideration of the many studies covering large populations, which are considered in the report, including those of Burk and Yiamouyiannis, the committee concluded:
  "We have found nothing in any of the major classes of epidemiological evidence which could lead us to conclude that either fluoride occurring naturally in water, or fluoride added to water supplies, is capable of inducing cancer, or of increasing the mortality from cancer. This statement applies both to cancer as a whole and to cancer at a large number of specific sites. In this we concur with the great majority of scientific investigation and commentators in this field. The only contrary conclusions are in our view attributable to errors in data, errors in analytical technique, and errors in scientific logic."
  The committee went further— hon. Members can study the report to see that these are not selective quotations—and stated:
  "The evidence permits us to comment positively on the safety of fluoridated water in this respect."
  The Knox inquiry was conducted entirely independently of the Strathclyde case, which by coincidence held its 200

  79
  days of hearings during the time when the Knox committee was carrying out its review of the epidemiological evidence.
  Lord Jauncey came to similar conclusions after hearing all the evidence, including Drs. Burk and Yiamouiannis for the anti-fluoridationists, and he concluded:
  "The fluoride/cancer argument, if I may call it so for brevity, has been shown to be based to a substantial extent on unsound principles and to have virtually ignored what may be described as the scientifically accepted facts of life about cancer and mortality."
  I hope that that deals with the serious concerns raised by many campaigners about cancer. Some people will still not be satisfied, be we cannot subject it to more exhaustive scientific and judicial review than that to which it has been subjected during the past two or three years. The so-called experts who have tried to establish a link between cancer and fluoride have been forcefully rejected by scientists and those who have heard the evidence.
  Mr. Ivan Lawrence: Were thorough studies carried out on thalidomide before it was put on the market as being utterly safe?
  Mr. Clarke: Not on this scale. A problem with thalidomide was that the most exhaustive tests were carried out, but, as is always the case with a new drug, and as we discovered in a few other cases, it is only when it is used extensively in the population that one has the final and most crucial test, when one can sometimes discover unexpected side effects. I do not wish to speak too authoritatively about thalidomide off the cuff, but with hindsight it is possible to say that not enough testing was done on expectant mothers. I hope that that failing will not be repeated.
  The Knox report, which considered the epidemiological evidence, was based on a massive amount of data. In such studies, the more people who have taken a substance and the longer the period during which they have been taking it, the stronger one's conclusions can be. As I said, 5 million people have taken fluoride through the water supply in Britain for many years. The figure internationally is about 200 million. Fluoride is not a rare substance. It has been added to water for years and many studies on it have been published. A review of all that evidence enabled the expert committee to come to strong conclusions. In this case, we are on strong ground compared with the usual introduction of drugs.
  Mr. Richard Alexander: I have followed my right hon. and learned Friend's argument closely, and I am trying to support him. He said that in some cases, such as thalidomide, there might be unfortunate side effects. The report from which he has given us evidence dealt with an investigation into cancer. Did it also consider unexpected or unfortunate side effects?
  Mr. Clarke: Yes; but cancer is the only one that has run for a long time. We considered cancer especially because the allegations about it have been more persistent. As I said, I could rehearse all the evidence about all the side effects, diseases or poisoning that have been claimed as deriving from fluoride. Lord Jauncey heard exhaustive evidence about many of those and came to his conclusions upon them. I said that I would not review them all, but it would be fair to the anti-fluoride case to say that the
  80
  allegations about cancer have been the most persistent. That is why my hon. Friend the Member for Reading, East asked the committee to consider cancer.
  Mr. Laurie Pavitt: I confirm the Minister's recollection of the thalidomide case. The Medicines Act 1971 was passed after it was realised that there had not been sufficient evidence about thalidomide and that it had been launched too quickly. Evidence presented to the investigation in Germany revealed that that had happened worldwide.
  Mr. Clarke: I am grateful to the hon. Gentleman. His recollection is the same as mine, and I am sure that he is correct. We have vastly more evidence on and experience of fluoride. There are parts of the world, a few in this country and a number in the United States, where the natural incidence of fluoride is higher than the addition proposed in this country. There is no paucity of evidence. The mass of evidence enables experts to come to the conclusions that I have outlined.
  I can demonstrate how exhaustive we have been, and will continue to be, in looking at various matters by dealing with the suggestion that fluoridation gives rise to a mutagenic hazard—the ability to alter human cells in ways that might be relevant to cancer and hereditary effects.
  Lord Jauncey considered that issue during the Strathclyde case and, after receiving the available evidence, concluded:
  "fluoride in the quantities likely to be ingested by humans from fluoridated drinking water has been positively shown not to be mutagenic".
  Since the Strathclyde case, a reputable Japanese scientist has published several papers demonstrating mutagenesis under laboratory conditions from very high concentrations of fluoride applied directly to cells. It is important to remember about that study, about which I am sure some of my hon. Friends who follow these matters closely have heard, that the authors of the work did not claim that it proved that fluoride would give rise to a mutagenic hazard at the much lower concentration of 1 mg per litre, which is standard to all British fluoridation schemes.
  Nevertheless, we set in hand a programme of studies intended to replicate the Japanese work and assess its relevance to fluoridation. The research has been planned and carried out on the recommendations of our Department's committee on mutagenicity of chemicals in food, consumer products and in the environment. We continually take the best advice that we can obtain on laboratory research here and abroad and keep ourselves up to date. It is important for everyone to understand that research work is always going on somewhere on many health products.
  Mr. Neil Hamilton: I am sure that my right hon. and learned Friend agrees that all that those reports can show is that, in the present state of scientific knowledge, fluoride in the quantities that are proposed to be added to drinking water does not constitute a health hazard.
  However, can my right hon. and learned Friend explain what appears to be an inconsistency in Government policy? In most cases, chemicals, if ingested in particular quantities, can be toxic. In the past year or so, we have devoted considerable time to considering the effects of the ingestion of lead from exhaust emissions from cars, and

  81
  so on. In that case, the Government have adopted a different test. They have said that although there is not a shred of evidence that existing levels of lead in the atmosphere arising from exhaust emissions constitute a health hazard, those who favour keeping the existing law have to prove positively that it cannot constitute a health hazard. Of course, it is inherently impossible to prove such a negative, but I wonder why the Government do not adopt the same principle on fluoridation which, in particular concentrations, can also constitute a health hazard.
  Mr. Clarke: I hope that my hon. Friend will forgive me if I do not get drawn too far into a discussion of lead in the atmosphere. However, I do not accept his description of where we are. There was no positive evidence to establish that lead in the atmosphere had damaged the health of children, but there was an area of doubt and of scientific contention. No one said that it could be proved that existing levels of lead in the atmosphere were safe. Therefore, it was decided to err on the side of prudence and to reduce the level of lead in the air. Certainly, no one claimed that lead was doing any good to anybody.
  In so far as one can establish a case to demonstrate the safety of fluoridation, the epidemiological evidence has done so. There have been exhaustive studies by many people over many years and they have not been able to demonstrate any corrolation between the addition of fluoride or the natural incidence of fluoride and any particular condition. Unless one demands an absurd level of proof, one cannot go much further in demonstrating safety. The case for fluoride is not on all fours with the lead problem.
  I thought that my hon. Friend the Member for Tatton (Mr. Hamilton) was about to concede that the health hazard argument is not valid in the fluoride debate. That is all that I am seeking to establish. I volunteer information on the latest studies to show how quickly we follow them up with our own research to check whenever doubts are raised.
  We have advice from the Department's independent, expert scientific advisers from all relevant fields on all aspects of the evidence about the addition of fluoride to the drinking water of whole communities to achieve a concentration of 1 mg per litre. They have considered all the available evidence on the biological effects of fluoride in short-term tests, including the mutagenicity evidence from Japan and the United Kingdom, and animal carcinogenicity tests, as well as the direct and extensive studies of human populations reviewed in the Knox report.
  All our scientific advisers, whom we use on a wide range of matters within the Department, conclude that there is no evidence leading to an expectation of hazard through the induction of heritable abnormalities, and no reliable evidence of any hazard to man in respect of cancer.
  I sense that most of the hon. Members who have intervened either agree with me on the safety point or are not pressing it too strongly. I conclude my remarks about the safety of fluoridation with reassurances about safety in relation to cancer and mutagenic effects. I hope that those assurances demonstrate that the Government, the Department and our advisers keep under review all the evidence relevant to the safety of fluoridation. That is not
  82
  unique in this country; international health bodies do the same, as do the Governments of countries where fluoride is added to the water supply of major cities.
  The passage of the Bill will not reduce our commitment to keep up to date on research and to take seriously any new doubts expressed about fluoridation. We will continue to draw on outside professional expertise, but the evidence is more overwhelmingly in favour of the safety of fluoride in water in the concentrations that we suggest than it is of the safety of many other things that are willingly accepted as part of health care of all kinds in this country.
  I hope that most hon. Members will now be prepared to accept that fluoridation represents a safe and effective means of reducing dental decay. There remain, however, the objections—raised by the right hon. Member fix the Western Isles (Mr. Stewart)—of those who believe that, irrespective of the safety of fluoridation and its benefits, it constitutes an infringement of individual liberty and should never be carried out. [HON. MEMBERS: "Hear, hear."] I am always glad that one gets a resounding cheer of support when one mentions liberty.
  Mr. Best: Only on the Government side.
  Mr. Clarke: I hope that no one will launch an attack on liberty in urging the case for the Bill. Contrary to the partisan remarks of my hon. Friend the Member for Ynys Mon (Mr. Best), with which I might sometimes agree in other contexts, I think that, by and large, we are all in favour of liberty. However, one can take libertarian arguments to an almost absurd degree and it does not always strengthen them.
  Mr. Dafydd Wigley rose—
  Dr. M. S. Miller rose—
  Mr. Clarke: May I begin before I give way? I hope that I do not have to stress my own commitment to liberty. It is not a challenge to the principle of individual liberty to say that in making judgments about cases, it is relevant to look at the degree to which one is infringing individual liberty. It sounds a dangerous argument, but it is not. The principle is not necessarily undermined by our looking at the degree to which individual liberty is affronted.
  If anyone suggested the introduction of imprisonment without trial, the vast majority of hon. Members would probably be only too ready to go to the barricades to defend our present system with vigour. But we are talking about a circumstance in which people will find that harmless quantities of a harmless product are, unknown to them, being added to their drinking water, with no harm to them, but with considerable benefits to their children and many other people.
  Several Hon. Members rose—
  Mr. Clarke: That does not dispose of the individual liberty argument, but I must put those libertarian arguments into perspective before my hon. Friends leap to the barricades. When I have put them into perspective, I shall give way.
  Let us consider what the threat to individual liberty is if we put into drinking water harmless quantities of this effective product in reducing dental decay. Hon. Members should consider the extent to which we all consume fluoride in other forms and the extent to which it already occurs naturally. First, I must point out that fluoride is present in most items of the diet, notably in tea. Indeed, heavy tea drinkers living in a fluoridated area will

  83
  consume more fluoride from tea than from consumption of fluoridated water. It is therefore somewhat ironic that Mrs. McColl was shown celebrating her victory after the Strathclyde judgment by drinking a "fluoride-free cup of tea". There is no such thing.
  Thus, I hope that I have put the issue into perspective. I have already pointed out that in many parts of the world people consume fluoride in their diets in far larger quantities than is proposed for our water supply. The exercise of individual freedom by those members of the community who feel so sensitive about our water supplies has an impact on the individual freedom of other members of the community. My hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) mentioned Birmingham. But the individual freedom of some people in Birmingham to refuse to allow fluoride to be put into the water is probably an infringement of the individual freedom of other inhabitants of Birmingham, who think that it will do them and their families good if fluoride is put into it—[Interruption.]
  Mr. Wigley: I have followed the Minister's argument in balancing the interests of one group against those of another. I accept that those groups may have different opinions and different opinions also from those of the right hon. and learned Gentleman. After all, none of us has a monopoly of wisdom, and hindsight may teach us severe lessons. But will he not at least concede that at the very minimum there should be a democratic decision, area by area, as the measure can be implemented area by area? When fluoride was introduced in some areas many years ago, it was introduced by elected local authorities. Since health authorities are non-elected, I believe that there should be local referendums so that people can decide for themselves on the very basis outlined by the right hon. and learned Gentleman.
  Mr. Clarke: I think that it should be a local decision and that is what we propose. A referendum on fluoride might not give rise to the consuming interest in the issue that is apparent in today's debate. However, I quite accept that it is a personal judgment. Indeed, the Government have accepted that by the way in which they have presented the Bill. Nevertheless, before we get a passionate argument about personal freedom, it is only fair to put the issue into perspective. Some of us believe that the benefits that the measure contains in terms of preventive health care are important. It is not a terrible affront to the freedom of an Englishman, a Scotsman, an Irishman or a Welshman to say, "You will have in your water some harmless substance of which you are not aware, which benefits the teeth of your family and of others."
  Mr. Andrew Bowden rose—
  Mr. Clarke: I shall answer the hon. Member for Caernarfon (Mr. Wigley), because he has touched on a very valid point, given the public sensitivities on this issue, which will no doubt be warmly expressed this evening. We believe, as he does, that it is right to continue to allow decisions to be taken locally after consultation of local opinion by the responsible local health and water authorities. That has been the policy of successive
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  Administrations for nearly 30 years. Much though we no doubt all look forward to an animated debate this evening on personal freedom, the Bill does not break any dramatic new ground. It restates the policy of successive Governments for the past 30 years.
  Responsibility for preventive health measures has been vested by Parliament in the Secretary of State and through him in health authorities or, in Scotland, health boards.
  Mr. Terence Higgins: I welcome my right hon. and learned Friend's statement about a decision being taken on a local basis, presumably to reflect the differences either in local variations of fluoride or in local opinion. But does he really think that health or water authorities are the appropriate bodies to judge local opinion?
  Mr. Clarke: There are genuine local variations in, for example, the incidence of natural fluoride in the water. There are also sometimes practical problems in adding fluoride to the water in some localities. Thus, there are those reasons for local decisions. The health authorities are charged with a wide range of responsibilities for local health and are, therefore, the bodies most competent to determine the health needs of the local population. We charge them with doing that over a wide range of extremely serious issues. Similarly, the water authorities are obviously charged with the responsibility for dealing with the water. If we added to the number of local bodies to be involved in all of those things, no decision would be taken on anything. We are placing the local decision in the hands of those bodies that take dramatically more important decisions in their respective fields for their localities.
  Mr. Andrew Bowden: Will my right hon. and learned Friend give way?
  Mr. Clarke: I should like to explain the local position with care so that everyone understands it. At present it is for the health authorities to decide, having consulted local opinion, whether to apply for water fluoridation, and then to negotiate with the water authorities over the detailed contractual arrangements. Financial responsibility rests with the health authorities, and the water authorities act as agents for them under the terms laid down in the contract.
  I emphasise that it is our intention in the Bill to leave those basic arrangements undisturbed. The Government thought about the issue, and we took a positive decision that we were not going to change our policy, the policy of previous Governments, or the practice of previous years. We are leaving the present basic arrangements undisturbed. The result is that the House may be assured that enactment of the Bill will not force any health or water authority to undertake fluoridation against its wishes. We rule out a national policy of compulsory fluoridation, which people will no doubt urge upon us. The Government thought about that and rejected it, because of the strong feelings that have been expressed.
  The Bill does not reflect the beginning of any major campaign to put authorities under pressure to fluoridate, where they or their populations are unwilling to do so. Again, I think that it is important to get these main issues of principle into perspective. The Bill is simply a measure to restore in Scotland and to confirm elsewhere the powers to make local choices about fluoridation that had been assumed to exist for more than a quarter of a century. In

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  future, those decisions will reflect—as they have done over the past 25 years—the undoubted effectiveness of water fluoridation in promoting dental health, and the different circumstances and views of various localities.
  Enactment of the Bill will simply mean that those authorities in England and Wales that have chosen to have schemes will not have to abandon them because of continued uncertainty about the law. Water fluoridation has been implemented on the whole rather slowly in Britain over the past 25 to 30 years, to the frustration of some of its enthusiasts. Enactment of the Bill will not necessarily change the pace at which it occurs, but it will confirm and clarify the basis on which individual authorities can look at the issues concerned and make their own choices. We are simply resolving a legal doubt which should not cloud the issue. In summary, we are alive to the case for fluoridation in dental health promotion and to local sensitivities. We do not see ourselves as breaking dramatic new ground.
  Mr. Jim Craigen: I think that we are all in favour of reducing the incidence of dental decay. If the Government brought forward legislation to reduce the sugar content in many of our foodstuffs and soft drinks, would not that have a significant effect in reducing the incidence of caries?
  Mr. Clarke: I agree with both those propositions. We engage in campaigns of health education through the Health Education Council and others, pointing out the effects of sugar on dental decay and inviting people to adjust their diets. But for the reasons which I gave earlier, fluoride in the water goes way beyond that. The two are not mutually exclusive. However much one may try, through health education, to advise people about reducing the amount of sugar in their diet, one will not reach more than a certain proportion of the population. Placing fluoride in the water has proved to be more effective.
  Mr. Andrew Bowden: Will my right hon. and learned Friend give way?
  Mr. Clarke: I should like to answer one hon. Member at a time.
  The hon. Member for Glasgow, Maryhill (Mr. Craigen) began by saying that he shared the view, which I am sure we all share, that we should reduce the incidence of dental decay. But if the Bill fails, it will not be open in any locality for local people and their authorities to decide that they want to introduce what has been proved to be the most effective single measure for reducing the incidence of dental decay in this country. If hon. Members vote against the Bill, they may have profound reasons—and some of my hon. Friends obviously think that they have—for doing so. However, they must not run away from the fact that in voting against it they will be rendering illegal a safe measure for reducing the incidence of dental decay which has proved to be extremely effective.
  I have explained the Government's position. We have taken a cautious step. We should not have taken any new step had it not been for the recent judgment. Without that we should not have altered previous law or practice. Faced with the Strathclyde judgment, the Government had three choices. The first was to leave the law in England, Wales and Northern Ireland in the uncertain state that would result from Government inaction. The second was to introduce a different law relating to pressure or
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  compulsion to spread fluoridation. The third was to restore the law to what it had always been assumed to be. By doing that we restore the power of the local decision, which has been assumed to exist for over a quarter of a century, so that localities which want fluoride can continue to have it. We chose the last course, which is sensible and reasonable. I hope that the House will give effect to it and give the Bill a Second Reading.
  8.30 pm
  Mr. Michael Meacher: The Minister began by saying that this was a modest Bill. He will be the first to agree that modesty is no guide to hon. Members being readily able to accept a measure. Some people may have thought that health and the National Health Service were simple matters. Frankly, although we are for it, fluoridation follows hard on the heels of Warnock, surrogacy and experimentation on embryos and hon. Members are disabused. We recognise the element of genuine and sincere controversy. Strong views are taken about some aspects of the proposals and so we recommend a free vote on the Bill.
  That does not mean that the majority of us have serious doubts about the beneficial health consequences of fluoridation. In many parts of the world it has been shown that the incidence of dental caries varies inversely with the fluoride in drinking water. The higher the level, in water, the lower the level of caries in the community.
  The Bill proposes fluoride at the level of one part per million—the optimum level. Since only 500,000 people here drink water containing natural fluoride at that level, the potential exists for a substantial gain in reducing dental caries throughout the country. Only 10 per cent of people here drink water artificially fluoridated to that level.
  Such a gain would not be trivial and it should not be underestimated. Caries is common and unspectacular, but it should never be regarded as inevitable and it is certainly not trivial. The 1983 child dental survey shows that by the age of 15 years, on average six of the 28 permanent teeth of children are either decayed, missing or filled. Caries is the principal reason for dental extraction. It is a disturbing comment on the nation's health that a recent survey found that about one third of a sample of people over the age of 16 in England and Wales had had all their teeth extracted.
  The economic cost to the nation must not be ignored. Dental caries is one of the most costly diseases. The treatment requires expenditure by the National Health Service of over £200 million each year in England alone. That is a substantial sum. It is also estimated to be responsible for the loss of over 2 million working days a year. Its prevention or reduction in terms of the individual's health and to the nation as a whole is a prize worth striving for. That is generally agreed.
  Mr. Nicholas Fairbairn: Expenditure of £200 million is dramatic. What proportion would be affected by fluoridation, since it affects only children up to the age of 12 years?
  Mr. Meacher: Fluoride affects young children, so the impact on adults will not be felt immediately. However in the long and medium terms the effect will be dramatic. As the Minister said, this is by far the most cost-effective means of reducing caries in the community in the medium term. Fluoridation is justified for the reasons that I have given. It is the most economical means of reducing dental caries.

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  It is sometimes said that fluoridation is unnecessary because equally effective means of attaining the same result are available. Caries would decline if people reduced their intake of sugar and refined carbohydrates. I agree that we need more aggressive campaigns to achieve that. Such campaigns are not alternatives, but additional. I doubt whether they will achieve the desired result on the scale required.
  Mr. Craigen: The problem is double-edged, because it is not a question of people regulating their own diets. People have no choice about the amount of sugar in soft drinks, for instance. The sugar content is often higher than it has to be.
  Mr. Meacher: That is true. There should be more parental control to discourage children from eating too much sugar and sweets, and the food industry should be more strictly regulated. Consumers should be given more information about the ill consequences of food which they buy. That could have a considerable effect, but it does not detract from the argument for fluoridation.
  Dr. M. S. Miller: Does my hon. Friend accept that there is doubt about sugar being the cause of dental caries? I do not speak on behalf of the sugar lobby, but my hon. Friend might be surprised at the so-called "evidence" that sugar does not have the effect which many believe it does have on teeth?
  Mr. Meacher: My hon. Friend the Member for East Kilbride (Dr. Miller) speaks with greater medical knowledge than I. I have been led to believe that sugar is one of the main causes of dental caries. If I am wrong, I stand corrected. That does not detract from the central force of the argument about the effectiveness of fluoridation.
  As the Minister said, the most health-conscious people are most affected by such campaigns. The great advantage of fluoridation is that it benefits most the poorest and the ill-informed— those who are not reached by other initiatives, however desirable in principle they may be. For instance, motivation by parents is needed to ensure that children receive the proper dose of fluoridation tablets over the years. Topical applications are time-consuming and have only limited effect.
  It is fair to say that this must surely be one of the most exhaustively researched public health measures of all time and from all the evidence it is reasonable to conclude that fluoridation is by far the most cost-effective means of reducing dental caries in children.
  Out of the abundance of evidence I cite only two examples. Birmingham began its fluoridation scheme in 1964. At the start of the scheme, five-year-olds in the Northfields suburb were found to have much the same level of tooth decay as in neighbouring Dudley, which did not fluoridate. Within only six years the Northfield rate had been halved, while the Dudley rate remained much the same.
  Secondly, research has shown that five-year-olds living in fluoridated Bromsgrove have three times the chance of never having tooth decay compared with children of the same age in non-fluoridated Hereford, not far away. Conversely, it was also found that a child in Hereford had 13 times more chance of having at least 10 or more teeth
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  decayed, missing or filled. One could give many other examples, but those are telling. There is much more evidence, both nationally, as the Minister said, and internationally and such evidence seems to me at least to be conclusive.
  Nor is the benefit of fluoride, as the hon. and learned Member for Perth and Kinross (Mr. Fairbairn) seemed to suggest, entirely confined to childhood. For instance, in naturally fluoridated Hartlepool, probably the area with the highest natural fluoride rate in Britain, it has been found that there is significantly less caries than in York, not far away, which has a much lower fluoride level. That improvement is found not only at the age of five, but also at the age of 15 and for adults over 45.
  However, I recognise—it would be difficult not to do so after listening to the Minister's reception—that the main objections to the Bill are not generally directed at the medical evidence but at wider considerations. Perhaps the most prominent argument is that, even if fluoridation is beneficial and safe, it still encroaches on individual liberty. The response earlier makes that clear.
  That would be a lot more plausible if those who made that objection did not also accept the regular addition of several other substances to drinking water such as copper sulphate, aluminium, calcium and chlorine.
  Mr. Best: To make it drinkable.
  Mr. Meacher: Indeed. That has a different effect but it is equally beneficial, desirable and harmless. If 40 chemicals are put into drinking water, the addition of one further does not seem to be a cause of such tremendous controversy. Lord Avebury, a well-known and notable advocate of many civil liberties causes, has said:
  "What is at stake is not the erosion of liberty but … 'the erosion of millions of teeth and the resultant suffering and misery of thousands of children, which fluoridation would go far to prevent'."
  Another major complaint is that fluoridation represents a form of mass medication. Frankly, it does not. One cannot emphasise too strongly that fluoride is a natural constituent of water supplies. It occurs in Britain in natural form in concentrations of up to 5·8 mg per litre—nearly six times the level proposed under the Bill.
  The adjustment of the quantity to an optimum level cannot be compared with the addition to the water supply of a substance not found there ordinarily. Equally, the phrase "mass medication"—the term most often used by opponents— seems to me at least both emotive and inaccurate as it is not a means of curing disease. I will say no more than that. I should have thought that a substance which had the effect of maintaining medical or dental health is more in the nature of a food or a nutriment than a medicine. It is a public health measure not unlike the adding of iodine to salt, calcium, iron and vitamin B to flour, and vitamin D to margarine.
  For those reasons, I take the view that the so-called ethical objections to fluoridation do not stand up to scrutiny. I know that that is not a view shared by everyone and I respect the force of their argument and the way in which some people regard that as decisive. But I do not think that that is a view that is widely held in the population.
  Nor do the claims that there are damaging medical side effects, including the cancer scare, which the Minister has gone to some lengths to dispel, hold water, although that is perhaps not the appropriate analogy. I am very much a

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  layman in such matters, as most hon. Members are, but I am impressed by the fact that Royal College of Physicians made a special study of all the available data in the mid-1970s and it concluded that there was no scientific or statistical basis for allegations of morbidity caused by fluoridation. A large list of conditions was discussed in depth. I know that there have been later studies, as the Minister mentioned.
  I am also impressed by the fact that that view has been corrobated over and over again in similar studies by the British Medical Association, the British Dental Association, the Royal College of Surgeons of England, the Royal College of General Practitioners, the Royal Commission on the National Health Service, the British Paediatric Association and the Health Education Council. I could mention many others and they are all, by any standards, distinguished bodies in Britain.
  I should be the first to recognise that those with an Athenasian inner certainty of their correctness in the face of the virtual unaminity of view of all the established bodies in Britain will not be persuaded. But in my view at least the medical evidence is overwhelmingly conclusive. Indeed, it is far more extensive than is strictly needed in order to warrant action now being taken on a wider scale to harness the preventive health potential of fluoridation.
  The Royal Commission on the NHS went rather further and said:
  "We are certain that it is entirely wrong to deprive the most vulnerable section of the population of such an important public health measure for the sake of the views of a small minority of adults."
  In other words, how can one justify not giving the child who lives in Wolverhampton or Salford the same protection against tooth decay as the child who lives in Birmingham or Watford already enjoys?
  Mr. Best: May I accept, ex hypothesi, that the addition of fluoride to the water is not mass medication but preventive medicine? The hon. Gentleman's faith in the medical profession is touching, but will he say which other substance of preventive medicine is administered by doctors not knowing the number or identity of the recipients or the total quantity to be ingested?
  Mr. Meacher: There are many. Salt is one. I am trying to think of the answer. It is only fair to say that one needs notice of such questions. It certainly can be answered and I should be glad to write to the hon. Member after the debate. But even if there were no immediate comparison to be made with any other product it would not prevent the application of fluoride up to a given optimum level if it has beneficial results. We do not need a precedent. We can take a view on the merits in their own right and that is what we should do.
  Mrs. Edwina Currie: Is it not a matter of fact that we, by regulation, add vitamins to flour, and that one of the proposals for eradicating rickets among Asian families is to add vitamin D to chapati flour? Are those not examples in exactly the terms suggested?
  Mr. Meacher: There is indeed, the important precedent of the bread and flour regulations. Iron and vitamin B are added to flour.
  I do not wish to rest entirely on the view of doctors, although they have some right to special expertise in this area. The view is also held by over two in every three
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  persons in the country. A National Opinion Polls nationwide survey in 1980 found that 67 per cent. of the people interviewed thought that fluoride should be added to water if doing so could reduce tooth decay. Only 16 per cent. opposed adding it. In other words, four times as many support fluoridation as are against it.
  Hon. Members will be the first to say that we do not make policy on the basis of the vagaries of opinion polls, and I accept that—they in no way indicate rightness or otherwise on this issue—but the results of that poll showed decisively that what is now proposed by the Government commands widespread public support. Significantly, for the purposes of the Bill, this general view, so widely shared by doctors and the population at large, was also accepted by Lord Jauncey in his Strathclyde judgement in June of last year, as the Minister said.
  The judge unequivocally repudiated the medical evidence against fluoridation. He categorically asserted that it was safe and effective— on the basis of a 120,000-word judgment and the examination, which had taken more than a year, and which had been one of the most thorough and comprehensive examinations of the evidence— and ruled only on a technicality that Strathclyde was acting ultra vires in adding fluoride because fluoridation had begun to be administered in Britain only in the 1950s, and it was therefore unlikely to be covered by the duty under the Scottish Water Act 1946 to provide wholesome water. The judge stated:
  "An individual's right to choose how to care for his own body should only be encroached upon by statutory provisions in clear and unambiguous language."
  I agree, but that is a legal comment, not a moral judgment. It is in keeping with his overall legal judgment—namely, that the law needs to be clarified if fluorides are to be added to drinking water—and I think it is fair to say that that is essentially why the Bill has been introduced tonight.
  It is because I believe that the evidence is clear and conclusive that fluoride in water, either naturally or added at one part per million, substantially reduces dental caries throughout life; that water with this concentration of fluoride in a temperate climate is safe, irrespective of the hardness of the water; and that fluoridation is much more cost-effective than any of its alternative topical applications, that I support this measure, clarifying the rights of water authorities by empowering them to add fluoride up to a given optimum level at the request of health authorities. It is the least response that this House can justify.
  I hope, therefore, that this modest Bill, which offers a substantial potential advance in the nation's health, will be carried overwhelmingly tonight.
  8.53 pm
  Mr. Nicholas Fairbairn: It is strange indeed for me to listen in this House to the hon. Member for Oldham, West (Mr. Meacher) and the Minister taking the view that the judgment of an upper-class Right-wing Scottish judge should be the basis for legislation. Indeed, it is even more astonishing that any decision of a Scottish court should be regarded as the basis for shaking the foundations of English arrogance and altering the natural belief of the English in their statutory powers.
  Dr. M. S. Miller: Go and take some fluoride.
  Mr. Fairbairn: Go and take some bromide.
  I do not declare an interest but, because the Minister suggested—it was an unfortunate suggestion—that those who oppose fluoridation may do so for flippant, absurd, transient or fantasised reasons, I should perhaps tell the House that before I did moral philosophy I did medicine and that after I did moral philosophy I did law. I believe that fluoridation fails massively on all three principles.
  If Lord Jauncey is to be quoted—fancy having a Scottish judge quoted in support of any constitutional change—let us remember that he said:
  "To use the water supply for mass medication"—
  the hon. Member for Oldham, West said that it was not medication; I refer him to page 367 of Lord Jauncey's judgment—
  "is without precedent or legal authority and is illegal."
  Tonight the Government are seeking to make what is illegal legal—[Interruption.] It is illegal in Scotland. It is not because they believe that it is illegal in England and Wales but because they fear it may be illegal.
  Fluoride is a potent catalase poison which is cumulative. Only one third of fluoride which is ingested is egested and, depending on the pH or acidity or alkalinity of the body substances, the amount excreted is vastly altered. Indeed, in acidotic conditions, the amount which is not excreted and is accumulated is vastly enlarged.
  Nobody on any side of the argument denies that it is toxic. Indeed, in the United States pharmacopoeia, it is linked and bracketed with arsenic, lead and cyanide as a poison. There are innumerable papers on the adverse effects at the volume proposed of one part per million, although in clause 1(5) the concentration is to be contained at that level only
  "so far as is reasonably practicable."
  As I say, there are innumerable papers by the most distinguished scientists, many of them Nobel prize winners, on the toxic effects of fluoride, and I will give a few examples, although it is not on the medical and scientific matter that I rest my case. Indeed, if there were no medical and scientific case against it, I should still oppose it totally.
  In India, Srikanha and Susheela have identified the characteristics of skeletal fluorosis such as calcification of the ligaments, joints and deformation of the bones and so on in many states where the level of fluoride is less than one part per million in the water. Of course, one of the variables is what else is in the water. In this country, there happen to be in most parts of the country where there is fluoride to that level large deposits of calcium and other minerals which are beneficial for the teeth and which to some extent lack fluoride.
  In Turkey, the Hacettepe university has undertaken enormous research into the fact that fluoride at that level delays and prevents the healing and fracture of bones. In Sweden, at the Karolinska institute, it has been demonstrated that less than the level of 1 ppm of fluoride in the blood causes a surge of fluoride retention in many subjects. In 1976, Albert Schatz related the incidence of fluoride to the infant death rate in Chile. In Grand Rapids, where they had fluoridation, dental fluorosis, or discolouring and mottling Of the teeth, occurred in 19 per cent. of the white population and 39 per cent. of the black population, which relates to the other ingested compounds. There are many variables.
  In West Hartlepool, which the hon. Member for Oldham, West quoted with such approbation, there is a
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  natural proportion of 1·5 parts of fluoride per million in the water. There is mottling of the teeth of 85 per cent. of the population and mottling or dental fluorosis to the distress point of 25 per cent. of the population. In osteoarthritis, the microcrystals of apatite are promoted and aggravated by fluoride. Even Dr. Donald Taves, who is such a promoter of the concept of fluoride, acknowledges its major effects on kidney malfunction. In general it affects hormones and thyrotoxine, locks up calcium, affects bone structure and affects the heart. It eventually causes a brittleness in the teeth which is far more expensive in the adult than any benefit that there may be in the delay of caries in a few children.
  There are variables. There are some who are exquisitely sensitive to fluoride and show all the symptoms of nausea, diarrhoea, ulceration, internal skin lesions, fatigue and pruritis. If the hon. Member for Oldham, West is concerned about health, he should listen to arguments that suggest that members of the public may be put at risk.
  There is the concept of variable thirst. There are conditions such as diabetes myelitis, diabetes incipitus, in which there will be different drinking patterns. One of the characteristics of fluoride toxication is increased thirst. This means that the variables result in different doses for different people and in different patients having different reactions to those doses.
  In his judgment, Lord Jauncey said that it was not proved that fluoride was harmful, but he said that he could not exclude that it caused cancer. He held that it would cause dental fluorosis in some children. I do not take the view that judges are the best arbiters of scientific evidence in cases where for about 200 days and more some of the most experienced and dedicated men, unmotivated by any interest or prejudice, take opposite scientific views on the effect of fluoride. That, to me, leaves the case thoroughly not proven.
  And all for what—so that we may reduce by 50 per cent. tooth decay, or delay it, in some children under 12 years of age. That is contradicted entirely by John Colquhoun, the retired chief dental officer of New Zealand. He stated last year that fluoridation had no effect on caries in children. In Birmingham, where there is fluoridation, there were 30 fillings per 100 teeth in 1964 and 40 per 100 in 1976, and an increase in milk teeth of 100 per cent.
  Tooth decay is caused by many reasons, such as chemically adulterated food. As the hon. Member for Glasgow, Maryhill (Mr. Craigen) has said, it is caused by false chemical additives, be they sugar or otherwise. It is caused by neglect of the teeth or by excessive sweet eating.
  Tooth decay, whatever its discomfort, is no worse than alopecia. It is no worse than athlete's foot. It is a nuisance, but it is never fatal. I know of no hon. Member, whether he has his own teeth, false teeth, filled or missing teeth who is thereby at any disadvantage.
  Mrs. Currie: Will my hon. and learned Friend give way?
  Mr. Fairbairn: No; I shall not give way. I was relieved to discover that my hon. Friend was in favour of fluoridation because that confirmed my conviction against it. [HON. MEMBERS: "Give way".]
  Mrs. Currie rose—
  Mr. Fairbairn: I shall give way now.
  Mrs. Currie: Is my hon. and learned Friend seriously saying that no one has ever died under general anaesthetic for dental treatment? If he says that, my hon. Friends who live in or who represent Birmingham can correct him immediately.
  Mr. Fairbairn: I am sure that many people suffering from piles, myopia or other ailments have died under anaesthetic, but that has nothing to do with tooth decay. It is to do with bad anaesthetics. If that is the basis of my hon. Friend's argument, I can say only that I hope she will take a general anaesthetic frequently. It is not for those who are against fluoridation to prove our case—great though the evidence is from most distinguished scientists. It is for the Government to prove their case. They must prove their case not on the balance of probabilities or possibilities or beyond reasonable doubt, but beyond all doubt, because so many distinguished scientists cannot be wrong.
  I base my argument not on science but on principle. If the case for fluoride were proved, I would still object to it on principle. As Lord Jauncey said,
  "To use the water supply for mass medication is without precedent or legal authority, and is illegal."
  As the Under-Secretary of State for Health and Social Security— my hon. Friend the Member for Oxford, West and Abingdon (Mr. Patten)— said, when the Government were introducing a plan to advise people what to eat:
  "Our job is to do no more than inform the public about the consequences of their actions for their health. Of course it is for individuals themselves to decide what to eat"—
  I assume that he also meant what the individual decides to drink—
  "and w hat risks to run."
  We have a Conservative Government trying to legalise compulsory force-feeding—in other words, to legalise assault. I doubt that that action would stand up in the European Court of Human Rights. Never has any remedial or preventive measure been made legitimate, far less compulsory, except in the interest of the person concerned. Force-feeding of the insane is exceptional, but all medical treatment of the sane requires the consent of the patient or, if he is comatose, of those who are able to give that consent. No patient in this country has ever been treated without consent. This measure suggests that every citizen should be compelled to be medicated—not for his own benefit but for the possible benefit of some other citizens who form a minute proportion of the population.
  Vaccination is in the interests of the person who is vaccinated. Seat belts are in the interests of the person who drives. No measure of compulsion forces a person to undergo any measure that benefits someone else, and certainly no medicinal measure does so. The legislation proposes that we should all be compelled to ingest a substance—whether it is harmless does not matter—so that some people may obtain benefit for a complaint which is never fatal and which is, at most, irritating.
  The medical profession recently predicted that 1·25 million homosexuals will die of AIDS by the end of the century. If the medical profession discovered a water-soluble substance which could render that disease not fatal—caries is merely an irritant—is it to be suggested that it should be added to our drinking water? If a vaccine were to be found which reduced the affects of schizophrenia,
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  should we all drink it? If the world population or rape crises were considered to be equally critical, should something be added to the water to alleviate those threats?
  There are four substances in the atomic scale of elements which attract a common club—the halogens. They are fluorine, chlorine, iodine and bromide. Iodine appears in traces in water. It is harmless and tasteless.
  Mr. Frank Dobson: Salt.
  Mr. Fairbairn: Salt is not a halogen, and it is not an element either.
  Chlorine is added so that every member of the public can drink the water provided in safety. It is now proposed that fluorine should be added so that some people will benefit. Hon. Members who were in the Army will remember that the fourth halogen, bromide, was added to tea, called No. 9, to reduce the sex urge.
  Mr. Craigen: It didn't do the hon. and learned Gentleman any good.
  Mr. Fairbairn: In the Army one could choose not to drink tea, but one cannot not drink water because of this legislation. It is important to remember that because fluorine is tasteless, citizens have no way of telling whether it has been added, and the Bill has no method of preventing the dosage ingested from causing fluorosis.
  I cannot but be amazed that the Government, who are dedicated to freedom and hostile to totalitarianism—[Interruption.] The fact that the hon. Member for Oldham, West supports the measure suggests that it is totalitarian,—who are suspicious of bureaucracy and hateful of tyranny and assault should be the author of a proposition to compel the public to swallow something which will be of no benefit to the vast majority of those who swallow it and may do great harm. A Government who object to local authority expenditure are compelling local authorities to add to that expenditure. The measure is contrary to the simple freedom of being allowed to drink potable water and of not being compelled to swallow anything which has no possible purpose for oneself.
  The Minister said that we were not breaking new ground. We are breaking new ground in principle in saying that everyone must ingest what might be good for a few people, and that everyone must undergo medication for the sake of a minute proportion of the population.
  If the measure passes tonight it will be because the payroll vote is as unfree to vote against it as we shall be unfree to drink water which is free of a substance which will do none of us good and may do all of us harm. It is not a matter of scientific argument; it is a matter of great principle. The Bill breaches a principle of freedom which has never been breached in this country before.
  9.15 pm
  Mr. J. Enoch Powell: It has been a profoundly evocative and moving experience for me to attend the introduction of the Bill in the House tonight as the second motion on the Order Paper on a rather dull day. Perhaps the House will bear with me for a few minutes to permit me to put on the record the reasons why that is particularly so.
  It came to pass many years ago that the scribes in the Ministry of Health gathered together. They came to me and said, "O Minister, behold, it is the season of private Members' Bills. Go, therefore, to hon. Members who have been successful in the ballot and persuade them to

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  introduce a Bill to legalise fluoridation of the water supply, for there is an exceedingly learned Attorney-General who has given his opinion that such a procedure requires statutory authority." I answered, "Not so, for if there should arise contention or tumult in that House, then the Bill may not pass, and the last state will be worse than the first. Wait, therefore, and possess yourselves in patience." They waited and they possessed themselves in patience. And it came to pass, after many days, that that Attorney-General went elsewhere and was succeeded by another Attorney-General.
  Then I called to me the scribes from the Ministry of Health and said, "Go now to the new Attorney-General and consult him on the question whether it be required that there be statutory authority for fluoridation of water supplies and omit not to tell him the opinion of his predecessor, for I have observed that the men of the law, the more eminent they are, the more they do rejoice in disagreeing with each other." So the scribes went and asked as they were bidden and, behold, the second Attorney-General gave an opinion which was adverse to the opinion of the first Attorney-General. And they came and told it to me. I said, "Take up your pens and write quickly unto all the health authorities that are in the kingdom, and tell them that if they consider it to be in the interests of health in their respective areas, they may enter into agreements with the water authorities to fluoridate the water supplies."
  I do not repent of that episode in my ministerial past. On the contrary, I am convinced that the decision that Ministers have had to take since the judgment in a Scottish court has been rightly taken by them, as the procedure brought into action some 25 years ago in the manner which I have described was also justified on grounds which a layman might rationally establish.
  First, there is overwhelming evidence that the presence of fluoride in drinking water avoids a great mass of dental caries in young persons. It does not avoid dental caries in all persons, but it is beyond doubt demonstrated to be beneficial to all persons in their younger years in respect of their dental health. It is also, in my view, overwhelmingly and crushingly demonstrated that the presence of fluoride in water— indeed in proportions considerably higher than are proposed to be artificially produced—has no morbid consequences whatsoever.
  I found most impressive, in arriving at that conclusion, the fact that in very substantial areas here in this country fluoride up to six times the proportion of one part per million has been drunk for generation after generation without it having proved possible to indicate any disadvantage in terms of health or any special or unusual morbidity amongst the populations which had drunk that water. I must admit that I found that demonstration even more impressive than the mass statistical experiment which has been carried out, of course more massively than ever in the past 25 years, in the artificial fluoridation of the water supply.
  Dr. M. S. Miller: To do justice to the views of the hon. and learned Member for Perth and Kinross (Mr. Fairbairn), does the right hon. Gentleman agree that there is one side effect—
  Mr. Powell: Yes, the mottling effect.
  Dr. Miller: Indeed, and it is not dangerous.
  Mr. Powell: I am much obliged to the hon. Gentleman for crossing that "t". However, the massive extent of fluoridation that has taken place makes the fact that there is no demonstrated correlation of morbidity with fluoridation so impressive as to be virtually irresistible.
  I am brought, therefore, as was the Minister, in conclusion to the proposition that fluoridation of the water supply is compulsory medication of the population. I must confess that I have been unable, despite the term having apparently been used by a learned judge, to understand how the term "medication" can in any proper sense be applied in this context. There is, of course, no choice which any one of us exercises over the public water supply in the areas where we live. In the areas where fluoride is present naturally, there is no choice available to any member of the population as to the fluoride which he ingests from the water supply. It is in the very nature of a public supply that there cannot be personal choice, except by extreme contrivance. That applies, for example, to all measures such as those related to the purity of the air, the removal of noxious fumes and so on, that are adopted in the cause of public health. They are measures of which the consequences, by their very nature, and by the very nature of the vector medium, are bound to apply to all members of the community.
  Fluoride is not a substance introduced into water to produce a specific medical effect upon certain individuals. It is not, as I understand it, medication in any natural sense. It is rather—I think that the word was used by the hon. Member for Oldham, West (Mr. Meacher)—a rectification of the content of the water supply, so that all areas can enjoy the same advantages as are enjoyed automatically in those areas where fluoride is present naturally in the water. I must therefore tell the House I have had to conclude that I, at any rate, can find no moral or libertarian reason why the advantages to be obtained from a water supply with a one part per million element of fluoride should not be made available to the people of this country at the discretion of the democratically elected local health authorities.
  9.24 pm
  Sir John Page: Never before have I had the opportunity to follow the most famous prophet of Westminster. Being neither scribe nor Pharisee, I may not do justice to the speech of the right hon. Member for South Down (Mr. Powell), although I think that on the whole the Pharisees have acquired a reputation that they did not really deserve. Of the many speeches that the right hon. Gentleman has made, I think that I enjoyed his contribution today the most.
  It is not always my role in the House to pour oil on wholesome but troubled waters, but today I shall seek to be moderate, modest and uncontroversial. First, I declare an interest as a director of a water company. My short argument will be devoted exclusively to the technical and administrative aspects of the Bill. I shall make no argument for or against fluoridation. I wish to remain entirely neutral on that, although I intend to vote for the Bill as it goes some way to clarify the legal uncertainties which currently face the water supply industry, as my right hon. and learned Friend the Minister for Health so honourably admitted in his speech.
  For slightly more than 25 years, according to the right hon. Member for South Down, water authorities have added fluoride to water supplies at the request of health

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  authorities and under the umbrella of an indemnity provided initially by the Ministry of Health, and that rather loose arrangement has continued to this day. The Bill goes some way towards formalising the existing scheme.
  Three aspects of the Bill—one major and two minor—are causing considerable worry and the industry will be most disappointed that my right hon. and learned Friend's speech today ignored the serious arguments and representations that it has put to him.
  Mr. Kenneth Clarke: It may have been drowned in the excitement caused by one aspect of my speech, but I certainly tried to answer the representations made by the industry— albeit en passant, as they were essentially technical matters. For instance, I explicitly stated that health authorities would meet all the costs. That was included in my speech as the result of the water authorities' representations. I hope, therefore, that my hon. Friend will not take the view that the Government have ignored the arguments put by the water authorities.
  Sir John Page: I am grateful to my right hon. and learned Friend. I listened to his speech with great dedication, but I must have missed his comments about costs, to which I shall return shortly.
  Representations were made to the Minister by the Water Companies Association, the president of which is our distinguished ex-colleague, Sir William Elliott, as well as from the water authorities. I quote just one paragraph, which clearly summarises the worries of the industry. The Water Companies Association states:
  "Our most serious concern arises over the fact that, as drawn, the Bill places the responsibility for the decision to fluoridate both on health authorities and water undertakers. In our view, this is quite wrong. Not only will this give rise to the difficulties which always occur whenever responsibilities are 'split' but it is quite inappropriate that water companies should be required to involve themselves in a decision which is essentially political, medical and ethical. Water companies have no wish to involve themselves in these issues and certainly they are not medically competent' to do so. The decision as to whether fluoridation is appropriate should be left entirely to health authorities"
  or, in the water authorities' view, to the Government as well as the health authorities.
  "A water company should be required to comply with a request to fluoridate from a health authority subject only to the proviso that the water company could refuse to comply with such a request on the grounds of technical feasibility."
  The Bill puts on water companies and water authorities a burden that they should not be asked to carry. It is the statutory duty of water undertakings to supply wholesome water. To add or not to add—that is a question that they should not be required to answer.
  Mr. Kenneth Clarke: It would be more difficult for me to deal with these points if I waited until later on. My hon. Friend's point is perfectly valid. The answer to it is that the Government took a conscious decision merely to seek to reinstate the existing policy and practice. Had we conceded the case of the water companies that they should have no discretionary power and that the responsibility should rest with the health authorities alone, the Government would have been attacked by a number of my hon. Friends for making fluoridation easier and removing an existing element of local discretion. The only reason why we have not been able in the Bill to meet the requests of the water undertakers is that we have been, if anything, over-scrupulous in meeting the concerns of my hon. Friends that we should not make it any easier than it is now to add fluoride to the water.
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  The decision of two local bodies will therefore be required—the health authority and the water authority—before fluoride can be added. It will be up to the water authority to decide to what extent it wishes to be guided by the health authority.
  Sir John Page: I am disappointed by that explanation. The vague messages previously sent down from the Elephant and Castle are now to be inscribed in the tablets of the law. We have an opportunity sensibly to place the responsibility where it should rest—either on the area health authority or on central or local government. I had hoped for a different reply from my right hon. and learned Friend. Perhaps he will think about the matter again, during the passage of the Bill.
  My right hon. and learned Friend says that he mentioned in his speech the question of cost. I understand that the question of cost is not covered in the Bill, and that the responsibility would remain with the area health authority. If that is so, I am extremely grateful.
  I should like my right hon. and learned Friend, or the Under-Secretary who is to reply to the debate, to clarify one more point. If the Bill were rejected tonight—I hope that it will not be—what would be the status of the existing agreements between the health authorities and the water authorities? I presume that they would not be affected.
  Mr. Kenneth Clarke: My hon. Friend the Under-Secretary is anxious that I should reply to this point now as he expects to have other matters on his hands when he replies to the debate. If the Bill were rejected tonight, the position of England would remain in doubt, as it is now, and would await litigation. In Scotland, a Mrs. McColl has challenged the satisfactory arrangement described by the right hon. Member for South Down (Mr. Powell) and fluoridation has been declared ultra vires. There are actions pending in England and presumably sooner or later someone would force such an action through and obtain a judgment for or against the existing arrangements. Water authorities could either carry on with their present arrangements until such time as they were challenged in court or they might decide, because of the continuing legal doubt and the refusal of Parliament to resolve it, to err on the side of caution and end the present arrangements. That is not satisfactory, and that is the main reason why we felt compelled to legislate, and commend the Bill to the House.
  Sir John Page: I have never had so many wise responses from a Minister and I have one more question for my right hon. and learned Friend. Why does clause 3(2) allow a period of two months from the time that the Act is passed before it comes into force? Is that period to allow companies to renegotiate existing agreements—if that is the case it is not long enough—or is to give those involved a short breathing space after the Bill has been passed? Will my right hon. and learned Friend say that during this two month period, after the Bill is passed and before it comes into operation, existing agreements will remain as they are at the present time?
  Mr. Kenneth Clarke: My hon. Friend is obviously anxious to investigate this question. I am a little uncertain about the two-month period. I think that the answer will be that it is the usual practice in drafting, and if a better argument is produced in Committee, no doubt it will be

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  changed. On the important question of what happens in that two months, I am sure that the existing indemnities would carry through existing agreements, and there is no prospect of anybody litigating and getting the agreements declared illegal. In practice, there would be no threat to the existing arrangements and water authorities can be untroubled while waiting for the Act to come into force.
  Sir John Page: Again, I am extremely grateful to my right hon. and learned Friend.
  Although the points I have made are undramatic and unemotional, which will perhaps be unusual in the course of this debate, they are of vital importance to the authorities and companies that are doing their best to supply wholesome water to the community.
  9.37 pm
  Mr. Michael Meadowcroft: I am sure that the problems of water authorities are important, but I shall return to issues of principle in the Bill. As the debate has progressed, it has become clear that this is one of those issues—fortunately for politicians, these are very few—in which there is a genuine clash of principle behind the different arguments. I appreciated the peroration of the speech of the hon. and learned Member for Perth and Kinross (Mr. Fairbairn), although I did not accept all the points that he made earlier in his speech.
  Quite rightly, there is a genuine fear of mass medication among the public. I cannot concede that someone would enter lightly into proceeding with a Bill such as this if they were not convinced about it. Those who vote in favour of the Bill must also be convinced that the arguments have been thoroughly tested and the balance of advantage lies with those who wish to see a particular form of prevention of dental decay being utilised in this form. Therefore, I am prepared to put on one side as being the worst of arguments the crucial principle that we must not lightly consider giving a substance to everybody in general in the community without being sure that we can do them good.
  The hon. and learned Member for Perth and Kinross appeared to accept that the compulsory wearing of seat belts was legitimate, because it did good to oneself rather than to other people. However, there was a paradox in what he said, because it was accepted even by those such as myself who were advocates of compulsory seat belts that in a minority of cases, the wearing of seat belts may be harmful to a person. For example, the car might catch fire and the person might be unconscious. The argument always lay on the balance of advantage, which might come from statistical sources, of wearing a seat belt. Therefore, the hon. Gentleman's argument is defective.
  Some members of the Liberal party, not only in the House but in the country, believe fervently in the arguments put forward by the hon. and learned Member for Perth and Kinross. The argument has two bases: one is the fear that this is a dangerous precedent—that is a legitimate fear—and the other is a fear of the unknown. Many people believe that fluoridised water may cause some side effects about which we know nothing now, but which could emerge in generations to come and which would cause us to wish that we had not done it.
  However—no doubt this has happened to all right hon. and hon. Members— many of my political colleagues in the Health Service have urged me
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  passionately to support the Bill, because they believe strongly, having studied all the arguments and the research, that the balance of argument lies with their case. The most telling fact is that during the 20 years or more since the argument has been contested in and out of the public arena—I have been involved with it since 1962 or 1963—with the continual stream of material being circulated in opposition to the fluoridation of water, and even in the light of the terrible tragedy of thalidomide and the side effects of other drugs, which have increased considerably the sensitivity and awareness of people in the medical profession of the possible problems of drugs, no professional health body has changed its mind about the efficacy of fluoridating water. That is extremely significant, because people have become much more sensitive to the effects of drugs, and have become much more concerned with the labelling and contents of food and health in general.
  My responsibility in the House is for health, and the Minister will recall that I have belaboured him for not giving as much attention as I believe he should to prevention. I have urged him to maintain the inclusion of thiamin and calcium in flour and bread; I cannot now say, "But I do not wish you to assist people by fluoridating water." I would not wish it to be thought that the fluoridation of water is a panacea that will solve all the problems of dental health. If the Government are seriously worried about tooth decay I hope that they will consider the adverse effects of sugar in the diet, and look to the better prevention of dental decay by the better labelling of food and by educating people about the contents of foods.
  There was a suggestion that the statistics may not be as powerful as has been suggested because other substances in the water in some places where fluoride has been added may have assisted in reducing dental decay. However, the evidence of Birmingham during the past 20 years must counter that suggestion. It is not suggested that dental decay was already low or that in controlled neighbouring towns and cities the level of decay was similar, because those other substances were also present in the water. During those 20 years, dental decay has been reduced dramatically. For example, the number of children attending clinics for the relief of toothache dropped from over 10,000 in 1965 to under 2,000 in 1977. Only 62 Birmingham children were supplied with false teeth in 1983—about one in 3,500 of the school population. In neighbouring Wolverhampton, the corresponding figure is one in 280—about 12 times higher.
  The protection offered by fluoride has to begin at birth to do the most good. If fluoride is put into school milk or into toothpaste, it is too late to have the maximum effect. Fluoride occurs naturally in many areas and it is significant that people living in those areas have never suggested that they wished fluoride to be removed from their water supply. None of the studies and evidence, even from opponents of fluoridation, have suggested that fluoride should be removed from water supplies.
  The one weak point in the Government's case is that the authorities that are to have power to implement the Bill when it becomes an Act are not directly elected. The right hon. Member for South Down (Mr. Powell) said that it would be better if fluoridation were introduced by democratic authorities. Sadly, neither health authorities nor water authorities are accountable to the electorate and it is a shame that that weakness in the system cannot be rectified in a short Bill.

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  If the whole population turned against those who have the authority to introduce fluoride, they would not have to resign, face the electorate or ask any outside body for support or approval. With that caveat, I shall support the Bill.
  9.47 pm
  Mr. David Atkinson: As my right hon. and learned Friend the Minister for Health explained, the Bill attempts to confirm the legality of a situation whose legality was not in doubt before the Strathclyde judgment.
  The Bill enables the decision to introduce fluoride to be made where it should be made—not at Westminster or in Whitehall, but by those whom we appoint to health authorities because of their special interest in health or their professional expertise. We believe those people to be the best to take into account local opinion, priorities and needs and to do so more objectively than any politician or civil servant could do. I am sorry that several of my hon. Friends want to deny their local health authorities the right to take that decision on behalf of their constituents.
  Before health was removed from the responsibilities of local councils, I sat on a county borough council that took a decision on fluoridation. I believe that we took that decision as well as any decision could be taken. All the members were personally briefed by those representing both sides of the argument, we listened to various deputations and we read a wealth of documentation and research relating to experience at home and abroad.
  We decided not to introduce fluoride because there was already a high fluoride content in our local water and it did not justify any addition. We took the decision in the best interests of the area that we served and we would have resented Parliament denying us the right to make that decision. Unfortunately, a number of hon. Members are suggesting that local authorities should be denied that right.
  Health authorities are not directly elected. The right hon. Member for South Down (Mr. Powell) and the hon. Member for Leeds, West (Mr. Meadowcroft) advocated a return to directly elected health authorities, and we have some sympathy with that view. But I see no reason why those who have been appointed to local or area health authorities cannot make an objective decision. Indeed, my local health authority plans to do so if the Bill is approved, after taking into account a local working party report with recommendations, as well as the views of the local community health council.
  I have every confidence in the ability of those who have been appointed to serve on my local health authority, the east Dorset health authority. I shall list the representation: those appointed by the Wessex regional health authority include one hospital consultant, one general practitioner, one nurse, one Southampton university representative, one TUC nominee, seven "generalist members", including voluntary organisation representatives, and five members appointed by local authorities including two from Dorset county council and three from the district councils. That is a pretty representative list, notwithstanding the fact that they are not directly elected.
  Very soon, those representatives will have before them a recent dental survey for the area of my constituency which shows that nearly half of Bournemouth's five-year-olds and two thirds of our 12-year-olds suffer from tooth decay. Those figures are very similar to those from
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  national surveys covering non-fluoridated areas. Moreover, we know from national surveys that nearly half the population will have lost at least half their teeth by the age of 40, and in so doing will undoubtedly have suffered great pain, great inconvenience in having to go to the dentist and heavy expenses for dental treatment. That is the sort of information that will come before my local area health authority.
  It would be irresponsible to deny the authority those facts in asking it to make decisions on behalf of my constituents. I admit that it is rather tempting to use the free vote tonight to vote against the Bill. Most of the letters that I have received from my constituents urge me to vote against it. Many of them refer to the fact that fluoride is a poison. Much evidence has been referred to tonight, but we have the assurance of my right hon. and learned Friend the Minister that it is not a poison. Obviously, the Government would not introduce such a measure and respected organisations such as the World Health Organisation would not approve of any measure that remotely related to poison.
  But of course no one wants to be unpopular. One has to think very deeply before voting against the advice of many of my constituents who have urged me to reject the Bill. However, I would be a party to a sad and retrogressive step if I voted against giving the Bill a Second Reading. It would be sad for present and future generations of my constituents who would never then have the opportunity of enjoying a level of dental health that it has been proved beyond all reasonable doubt would be available to them. They would then be condemned to suffer needlessly the consequences and cost of tooth decay for the rest of their lives. I would not want to be a party to that.
  It would also be retrogressive to vote against the Bill because it would mean that future generations in those areas— including many of our big cities— that have benefited from fluoride in their water supplies for many years would no longer enjoy the same level of dental health— until, that is, a future Government decided to introduce a national policy. If, through the introduction of fluoride into our water supplies, dental decay can be avoided, we will do our constituents no service by denying their health authorities the right to decide— which is what we are talking about—to introduce a proven, safe, economic and effective way of dramatically reducing the incidence of tooth decay.
  Therefore, I hope that the House will show its good sense by giving the Bill a Second Reading.
  9.55 pm
  Mr. Laurie Pavitt: The hon. Member for Bournemouth, East (Mr. Atkinson) effectively underlined the way in which the Bill has been drawn to enable a legal muddle to be cleared up and so that the local people can decide. I reassure him about pressures from his constituents. He is experienced enough to know that the people who take the trouble to write to him do not necessarily represent all his constituents. When "Mr. Clavell-Blount" and his fluoridation lobby are at work, letters will not necessarily be in line with his judgment.
  I spent last year attacking Tory Health Ministers, but now I congratulate the Minister on this measure. He will recall that in the debate on the Gracious Speech I chided him for being a coward and running away from the issue.

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  I asked him why the measure was not mentioned in the Gracious Speech. Fortunately, he has had second thoughts.
  I spend most of my time considering health issues and crossing swords with Tory Ministers. I was pleased by the contribution by the right hon. Member for South Down (Mr. Powell), because I cut my political teeth on NHS matters when he was Minister responsible for health. The right hon. Gentleman made an important decision after Prime Minister Macmillan ordered three years of extensive research in three areas— Kilmarnock, Anglesey and Watford. That followed five years of research in the United States. The results proved beyond peradventure that one of the greatest moves towards the prevention of unnecessary pain and suffering was at hand in the fluoridation of water. That impeccable precedent is being followed tonight.
  We have heard platitudes from all Ministers responsible for health about prevention. An example is smoking, and the 100,000 deaths that occur prematurely every year. At least we now have an enabling Bill so that something can be done about a serious problem.
  Most hon. Members have concentrated tonight on the effects of fluoridation on children, but one must remember that we are talking about the teeth of children who will one day be 40 or 60 years of age. We try to stop young people from becoming addicted to cigarette smoking, but we are not worried so much about the older generation. In this measure we are also concerned about health care and prevention. Such measures apply to children because they have a life ahead of them.
  Caries and the consequential toothaches, fillings and extractions could, within 20 years, be as unknown as the Charles Dickens' workhouse of the last century. Hon. Members have referred to the Royal Commission's findings. Fluoridation and a number of other factors could ensure that in the next century toothache, dental caries and extractions never occur. A number of measures are required to achieve that, but Fluoridation is the first step.
  The main objective is to establish a healthy body for the young and to maintain it during growth and later life. The House has heard about the number of people of 40 and 60 years who have mouths filled with china and porcelain instead of natural teeth. A recent Army survey of 18-year-old recruits shows that a staggering number suffer decay and need dentures.
  The arguments for Fluoridation rest upon thorough medically qualified research in many countries. The arguments against rest mainly on fairly dogmatic assertions. As the Minister has already said, 200 million people in the world are already benefiting from the prophylactic of Fluoridation to prevent dental caries.
  The phrase "mass medication" is a slogan. Those hon. Members who are worried about it should not drink anything in the House of Commons, because the Thames water authority adds 33 different medical substances as a prophylactic against illness—
  It being Ten o'clock, the debate stood adjourned.

  Water (Fluoridation) Bill

    BUSINESS OF THE HOUSE
    Ordered,
    That, at this day's sitting, the Water (Fluoridation) Bill and the National Heritage (Scotland) Bill may be proceeded with, though opposed, until any hour.—[Mr. Archie Hamilton.]

  Water (Fluoridation) Bill
  Question again proposed.
  Mr. Pavitt: As hon. Members will know from previous debates on the subject, every drop of water that is drunk in the House, including tea and coffee made with it, has already been through the human body six times. If hon. Members feel that there is some way in which then-individual liberty is being threatened by having that water cleaned before they drink it for the sixth time, I cannot follow that line of argument.
  Hartlepool, Derbyshire and a number of other areas where there is a high concentration of naturally occurring fluoride in the water have been discussed. The anti-fluoridation lobby has never suggested that the Government should take action to remove that fluoride content.
  Let us consider the economic basis of the Government's policy towards the NHS in trying to get the best value for public expenditure. There has been a great increase in the amount of public expenditure on the treatment of dental disease. In 1975,27·2 million treatments were paid for by the NHS. There have been, of course, the unfortunate charges that Governments have imposed upon patients since that time. By 1982 that had risen to 31·7 million. In 1975 £169 million was spent on dental services out of the total Health Service budget and in 1982 that had risen to £401 million.
  A good deal of evidence has emerged from recent research being undertaken, particularly in the London hospital and by the dental working party established by the Labour party. It shows the way in which Coca Cola, ice cream and so on are injurious to children's health. But the fact remains that fluoridation is the most effective first step in dental care, despite the possibility for further action by Government.
  The Royal Commission has already been quoted. Its recommendation 5.31 on page 49 says:
  "There are major areas where Government action could produce rapid and certain results: a much tougher attitude towards smoking, towards preventing road accidents and mitigating their results, a clear commitment to Fluoridation".
  That clear commitment is not coming from the Government tonight, but at least the Government have made it possible for local health and water authorities to proceed without being threatened with an injunction or High Court action which would prevent them from taking the necessary steps.
  We are in favour of topical applications where fluoridation does not exist. We are in favour of the use of fluoride in milk, as happens in some southern counties in Britain. Nevertheless, everybody drinks water. There is no way in which one millionth of a part of fluoride added can in any way be injurious to health, and that has been proved time and again. This is a first step. I urge the Government to follow it through by accepting the other recommendations of the Royal Commission most of which were adopted as part of Labour party policy at the 1978 annual conference. The Government must, apart from this enablement, look into what is being done for school dentistry, examine the whole question of oral hygiene and consider the amount of expenditure that can be made so as to improve prevention rather than treatment.
  We appreciate the difficulty faced by the Minister in that no Chancellor of the Exchequer is prepared to spend a penny today to save £10 in 10 years' time. Nevertheless,

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  if the Minister will carry out a follow-through policy of prevention, not only in this but in other spheres, we shall enter the next century with more healthy people and with fewer claimants on the National Health Service, enabling us to speak of the number of people who no longer need to be treated. It will mean people being able to go through their lives without oral diseases, without dental caries and without suffering the disastrous pain of toothache, so enabling the dental profession to concentrate on other areas. I pay tribute to the dentists, who are strongly in favour of the measure, although it might eventually put them out of work.
  10.6 pm
  Mrs. Edwina Currie: I support the Bill, which is both fair and proper. From 1975 I was privileged to be a member of the Birmingham area health authority and subsequently, on reorganisation, to be chairman of the central Birmingham health authority. I was, therefore, close to and ultimately responsible for Birmingham dental hospital, the main teaching hospital outside the London area and a hospital of great renown; I was also a patient of that hospital for three years; and, like others, I am a parent, having two young children.
  I tried during those years to come to this question with a completely open mind. Birmingham fluoridated its water more than 20 years ago and the results have proved extremely interesting. I will not quote the statistics because they have been mentioned by my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) and the hon. Members for Oldham, West (Mr. Meacher) and for Leeds, West (Mr. Meadowcroft).
  We also had some interesting statistics from my hon. and learned Friend the Member for Perth and Kinross (Mr. Fairbairn). His seemed to be the opposite way round to most other statistics produced in the debate, suggesting that he was quoting from the wrong years. If he will do me the courtesy of sending me a copy of the figures he has, I shall examine them.
  All other figures have shown that there has been a sharp drop in the number of dental caries; a great drop in the number of children without teeth or with dentures; a great reduction in the number of children who have had to be treated under general anaethesia, so enabling us in Birmingham to close a clinic; a sharp drop in expenditure on the removal of teeth; and an increase in expenditure on orthodentistry and conservation.
  Those improvements have affected not just children, but adults, too. Indeed, we had problems with students because we ran out of people on whom they could practise and had to bus in children who were in need of treatment from other parts of the country. We were thereby able to pay much more attention to the dental care of the elderly, an area which had been greatly neglected.
  If I had any doubts on this issue, the care of my two girls has proved to me the rightness of what the Government propose. My elder daughter was the result of a pregnancy carried in London, where the water is unfluoridated, although she was born in Birmingham. She had no end of trouble with her baby teeth, though her adult teeth are fine. My younger daughter, who was carried and born in Birmingham, where the water was fluoridated, has needed no dental treatment of any kind and has no fillings, even though she is coming up to her eighth birthday and eats sweets at a rate that makes me envious and, more important, eats them at the same rate as her sister.
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  Anyone who puts forward the argument that dental disease is trivial has never sat time and again in a dentist's waiting room with a terrified child. For children, fluoridation has been nothing but good.
  Dr. M. S. Miller: I accept what the hon. Lady says. Does she accept, however, that sepsis in teeth, when it develops as the result of caries, can produce all sorts of conditions? The fluoride does not produce the conditions, but the septic organisms can cause rheumatic fever and many other diseases in children?
  Mrs. Currie: I accept the hon. Gentleman's professional opinion on that.
  The arguments on medical grounds that I have heard will not wash—the argument, for example, that fluoride is a poison. Anything is a poison if we take enough of it. My hon. and learned Friend the Member for Perth and Kinross has rejoined us in the Chamber. Were we to spreadeagle him on the Floor of the House and pour absolutely pure H2O into him, it would kill him or anyone else subjected to that treatment in hours. That would be the result of ingesting any commodity, be it a vitamin, good food, bad food, fluoride sodium chloride or anything else. Anything is poisonous if we subject ourselves to enough of it. No one is suggesting that we do any more than put one part per million of fluoride in the water.
  Mr. Fairbairn rose—
  Mrs. Currie: I shall give way to my hon. and learned Friend in a moment.
  Most of the medical issues which have been raised have been introduced by those who have other objections to the adding of fluoride to our water. That does not absolve us from continuing to be vigilant when dealing with health matters. We must not be complacent.
  Mr. Fairbairn: All the poison that my hon. Friend suggested I would happily take rather than be spreadeagled on the Floor of the House by her.
  Mr. Michael McGuire rose—
  Mrs. Currie: We have heard other arguments that are much more serious—for example that people can obtain fluoride in other ways. The trouble is that they do not. The families who need help most, whose diet is the most deficient and who take no notice of health education, are exactly those who need the assistance of passive medication, such as the fluoridation of water. It is the simplest, cheapest and safest method that is available to us. It is certainly the cheapest when we take into account the cost of doing nothing. It is the safest when we take into account that we know that there is control and we know how much fluoride is in the water. We do not know, of course, how much is being taken in other forms.
  It is argued that we should not add flouride to our water and that we should drink it in its natural state. My home is on a hill in Derbyshire and there are many pure spring waters in the area. I would not touch any of the water that comes out of the ground in my area with a barge pole. I would not touch it in its natural state. The water is cleaned and purified, especially that from the Trent, which passes through all the local power stations, which have been working overtime recently. We chlorinate the water and we would be remiss if we did not. In London we would all have died of dysentery and cholera a long time ago if

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  we had not treated the water effectively all the time. To fluoridate our water provided that the local people want it, seems to me an extension of public responsibilities.
  Mr. Robin Maxwell-Hyslop: Is my hon. Friend saying that fluoride should be introduced only if the local people, who will drink it, are given the opportunity of saying whether they want it, as opposed to the non-elected water authority meeting in secret without the presence of the press? Is that her proposition? That is what she is saying.
  Mrs. Currie: As I understand it, the main recommendations and decisions will come from the health authority as well as from the water authority. I was a member of a health authority, and I am aware that the authorities are represented by a number of local representatives, who take their duties extremely seriously. They are councillors, who are elected representatives. When I was a member of a health authority, one of its representatives was a member of this place, and that was Miss Sheila Wright, who represented Birmingham, Hands worth.
  It is said that we should not go in for mass medication because it is not morally justified. That is the most powerful of all the arguments and I would much rather we did not need to medicate our water. However, it seems that it is necessary to balance two undersirable events. First, there is the undesirable event of attacking people's freedom by medicating for everybody. The alternative is to risk lives, especially the lives of children. Children used to die under general anaesthetic, but it is now generally unknown for a child to die under dental treatment in fluoridated areas. That applies to adults and children. My right hon. and hon. Friends who represent Birmingham constituencies will recall that not long ago there was a scandal in Birmingham when two patients of a dentist died under anaesthetic. I accept that they needed better treatment, but they would not have died if they had not had bad teeth.
  Every attempt at medical and dental intervention carries a risk for people. For some it is a high risk. We have a responsibility to reduce that risk, if possible, in much the same way as the House did previously when it agreed to compulsory inoculation against smallpox, which resulted in the eradication of that disease. We can eradicate dental caries as a disease.
  My hon. and learned Friend the Member for Perth and Kinross said that a medication should benefit a particular individual. We must balance the cost of treating dental disease, and that cost bears down on all of us. If it is undesirable to reduce freedom, it is undesirable also to spend public money in large quantities unnecessarily. Our freedom is reduced when large amounts of tax are lifted from our pockets and those of our constituents to pay for the treatment of dental disease in other people which is readily avoidable through fluoridation. For those reasons, we should support my right hon. and learned Friend the Minister for Health.
  10.15 pm
  Mr. Keith Best: My hon. Friend the Member for Derbyshire, South (Mrs. Currie) speaks with great passion on this subject, as she does on all matters. Although some of those who are against the artificial
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  fluoridation of water supplies are sometimes accused of being emotive in their arguments, I am confident that that criticism will not be levelled exclusively at them but will be levelled against some who are in favour of artificial fluoridation. My hon. Friend is so vivacious an advocate that I am sure would never be in danger of dying under a general anaesthetic or of being rendered unconscious under one.
  Unfortunately, I cannot agree with my hon. Friend the Member for Derbyshire, South. My right hon. and learned Friend the Minister for Health rightly said that in this Bill the Government propose to do no more than to restore the position to the status quo. He said also that he is perfectly satisfied that artificial fluoridation of water supplies inhibits dental caries and benefits the general population. I do not doubt that my right hon. and learned Friend generally believes that that is so. I have little doubt that fluoridation of water supplies can play its part in preventing dental caries. All hon. Members would like that to occur. Just because those points are true does not mean that hon. Members are not entitled to offer their views on whether they believe it is right that there should be an artificial mass addition of fluoride to the water supplies.
  I shake my head in disbelief when I hear a Conservative Government— some have said, the most Right-wing Conservative Government this century— propose legislation to add to the water supply an industrial poison, as it is described in the 1976 report of the Royal College of Physicians, which comes from industrial wastes and is said to be necessary to sustain life. I shake my head in disbelief also when I hear the Opposition support the judiciary, the Government and the medical professions. I wonder whether the House has gone topsy-turvy.
  The Government are satisfied that fluoride is safe. If so, why do the Government offer an indemnity? Why would health authorities not recommend the artificial addition of fluoride to water supplies if there was no indemnity? That is a simple question, but the answer is more complicated. I hope that my hon. Friend the Under-Secretary of State for Health and Social Security will address his mind to that problem. If the Government are certain that fluoridation is safe, there should be no need for an indemnity. If they are not, it should not be added artificially to the water supply. That proposition is wholly true and unchallengeable.
  Fluoride is cumulative. What is a safe dose? I challenge any hon. Member to ask any doctor or dentist what a safe dose of fluoride is. There will be no answer because no doctor or dentist would know the total amount of fluoride ingested in a patient. Moreover, fluoride is a noxious substance.
  Contrary to what many hon. Members said, fluoride does not occur naturally in water but is picked up by water in its passage through the ground, or down a river, such as the Thames. We then drink it in our tea in the House of Commons Tea Room, as the hon. Member for Brent, South (Mr. Pavitt) vividly explained. We are told that fluoride is beneficial to the population. I hope it is, because everyone in a fluoridated area must drink it. They have no choice. However, I am not aware that it does a great deal of good to pensioners with false teeth— perhaps I shall be told differently— or to patients suffering from a renal complaint. They are told in a cavalier way that it does not matter if they live in a fluoridated area because they can put a filter on the tap.
  The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): I have listened to my hon. Friend's remarks with great care, and I am anxious not to cause unnecessary alarm among the many patients who receive renal dialysis. Does my hon. Friend accept that we offer standard advice through the National Health Service to all those charged with maintaining renal dialysis units, which is that they should screen the water for products which would harm those with renal failure, including aluminium, fluoride and other substances? There is a great range of substances in water. My hon. Friend must accept that we ensure that substances which would adversely affect dialysis patients are not present.
  Mr. Best: I accept unreservedly what my hon. Friend said. He confirms my point that fluoride should not be taken by those who suffer from renal complaints.
  Lord Jauncey, in his judgment, said that the addition of fluoride would
  "necessarily involve a restriction on the freedom of choice of the individual, who would have little alternative but to consume the fluoridated water whether he likes it or not."
  If hon. Members are so concerned about compelling people to take preventive medicine— I use that term because it seems to be the most neutral term in use during the debate— why do we not ban smoking? Smoking undoubtedly causes lung cancer. No hon. Member would disagree with that. Yet for some extraordinary reason we allow people to go on killing themselves and to die of lung cancer at great cost to the NHS, by not banning smoking. What is the reason for not banning smoking?
  Mr. Jerry Wiggin: People like it.
  Mr. Best: My hon. Friend says that people like it. It may not be wholly dissociated from the fact that people should be allowed to smoke if they wish, having had the dangers of it pointed out to them. The alternative is to say that nobody should make a conscious decision about whether to do or not to do something which may be harmful to health. I do not think that anyone in this House would want to live in a society where that choice was removed altogether.
  I do not wish to introduce a note of levity into the debate, but many people suffer from indigestion and we do not add antacids to the water supply. It would be wrong to do so, for not everyone suffers from indigestion. But it is also true that not everyone in an artificially fluoridated water area suffers from dental caries. What about the people who do not suffer from dental caries and are not likely to do so?
  What are the criteria for the addition of a substance to the water supply which is designed not to make it potable, not to remove poisons which would otherwise be harmful to the body, but deliberately and positively for the purpose of preventive medicine? We are entitled to ask what are the criteria for adding any such substance to the water supply.
  Let us restrict the argument to water, as that is the one substance that we must drink to sustain life. I do not believe that the House has addressed itself to that question tonight. I do not believe, with respect, that the Government have addressed their mind to it. I am not for one moment saying that this might be regarded as the thin edge of the wedge, so that someone might suggest that if
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  a tranquilliser could be added to the water supply it would be highly beneficial to society because it would reduce the incidence of violence and other anti-social behaviour. I am not suggesting that that might be regarded as a precedent.
  Mr. Fairbairn: Why not?
  Mr. Best: I suppose some might regard it as a precedent. That brings me to the point that hon. Members have not yet addressed their minds to the criteria for the addition of some substance to the water supply.
  Mr. Sydney Chapman: Surely the answer is that fluoride already exists in water. If my hon. Friend is saying that it should not exist to the extent of more than or up to 1 mg, is he also suggesting that the Government should legislate to take natural fluoride out of the water supply in order to conform with his wishes?
  Mr. Best: I am grateful to my hon. Friend for his question, because it seems now that the proposition is that anything that exists already in substances that we take must be left in because it is accepted as a matter of history. I do not regard that as either a laudable or a responsible view for this House to take.
  Mr. Edward Leigh: Is not the inference that just because a substance occurs naturally somewhere, it should be imposed on everyone everywhere? Can that be right?
  Mr. Best: My hon. Friend knows my answer to that question, and he must address it to those who wish the Bill to get a Second Reading.
  Much has been said about local choice. An opinion survey in Anglesey, the area that I have the privilege to represent, made on 30 November 1983 by the Gwynedd technical college, demonstrated that 26·5 per cent. of persons questioned were in favour of the artificial addition of fluoride to the water supply, and that 53·6 per cent. were against. My own survey of my constituency showed that 30 per cent. were in favour, but 45 per cent. were against.
  I am not a populist. I do not believe that it is the function of hon. Members merely to reflect the whims of the local population, because our job must be to exercise our judgment, but I hope that all hon. Members will understand the sense of frustration that is experienced by the people living in my constituency who, time and again, demonstrate their opposition to having fluoride artificially added to their water supply but who can make no democratic decision about it. That is because there is no capacity within existing legislation for such a decision to be taken.
  There is, of course, the referendum. I suggested the idea of a referendum on 21 December 1981. If this is to be a matter of genuine local choice, should not the people of the area make that decision and speak their mind—or, if not them, the directly elected borough or district council? That is no good to those who want fluoride added to the water supply of Anglesey because the local borough council is against the artificial fluoridation of water supplies. What, then, of the consumer watchdog of the National Health Service, set up by legislation to watch over matters in the NHS— the community health council? That is no good, because the community health council is against the artificial fluoridation of water supplies as well.

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  My right hon. and learned Friend the Minister for Health recognises that this is an ethical question. It is not the same as the death penalty, on which I am opposed to a referendum because I believe that the punishment of offenders must remain the prerogative of representatives
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  in the House. I am not sure that even a referendum, which would be binding on a dissenting minority, is the right answer. Ultimately, surely the proposition comes down to this. Preventive medicine must remain a matter of individual choice, of encouragement and exhortation perhaps, but of individual choice, and not compulsion.
  10.32 pm
  Mr. Michael McGuire: I apologise for the fact that I have not heard many of the speeches that have been made.
  I am opposed to the Bill. I hope that those who spoke in favour and who want to intervene in what I hope will be a short speech will make the points that they think will convince me. Sometimes we come into the Chamber in one frame of mind and listen to a speech, and it changes our point of view. I am not saying that I have such a tremendous command of language and oratory as would make those in favour of the Bill change their mind, but I hope that those who want to will intervene, and briefly. The hon. Member for Derbyshire, South (Mrs. Currie) did not give way to me in her speech. I hope that hon. Members will intervene to try to convince me that the Bill should go through. I believe that it should not. It is thoroughly bad, and on one sound principle alone.
  I cannot pronounce the new name for the constituency that used to be called Anglesey. The fixed points in the House have gone since we changed so many old and well-loved names. I am sorry that I cannot refer to the hon. Gentleman's constituency by name. He dwelt at length on preventive medicine and whether it is the duty of the State to take certain decisions that it believes will make the citizens healthier—in this case, we are concerned with their teeth. I would be in favour if it could be proved that, if fluoride was put in water people who ingested it, especially children, would have a magnificent set of teeth. Nobody is suggesting that, however. The proponents of the Bill say that if flouride is added to water in the suggested proportions young people's teeth will be saved from decay, to the extent that one or two teeth will be saved in their lifetime, and they will not need to have three or four fillings.
  Dr. M. S. Miller: It is not a matter of one or two teeth. Depending on the age at which it begins to be given, which should preferably be during the mother's pregnancy, 60 per cent. or more of fillings will be avoided and in some instances it will save the person's teeth throughout life.
  Mr. McGuire: I am interested to hear that, as none of the proponents sending out literature about this has ever made that claim. But even if my hon. Friend's claim were proved, I should still oppose compulsory Fluoridation because it is not for the State to take that decision. Vaccination is not compulsory, although the benefits are far greater. There are advertising campaigns to persuade people to have their children inoculated, but there is still freedom of choice.
  Is my hon. Friend suggesting that if people take fluoride they will not have to take care of their teeth?
  Dr. Miller: No.
  Mr. McGuire: Of course not. If people take fluoride but neglect their teeth, they may delay the onset of caries for a short time, but it will not prevent it. Whether the water is fluoridised naturally, artificially or not at all, if people do not pay attention to dental hygiene they will have bad teeth and they will need fillings and extractions. It is convenient to argue that in some areas fluoride occurs naturally in the water, but has anyone analysed all the other naturally occurring constituents in the water?
  I sense that many Conservative Members intend to oppose the Bill and they are right to do so. The soundest
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  principle on which to oppose it is the fact that it is compulsory mass medication. Anyone who argues that that is not so is guilty of sophistry of the worst kind. People are given no choice in the matter.
  On a lighter note, if we wished to try to eradicate common complaints by compulsory mass medication we should consider ailments such as constipation. No one has seriously suggested that that should be dealt with nationally, although it affects far more people. The same could be applied to smoking, dieting, and so on. The State would end up acting as nanny to all of us. Nobody wants that.
  No case has been made for compulsory Fluoridation beyond the fact that it will delay the onset of caries and the extraction of teeth for a short time. No one has suggested that if people do not pay proper attention to dental hygiene they will not suffer the consequences, whether there is fluoride in the water or not.
  It is no part of the duties of the House of Commons to give the green light—which is what the Bill will do—to a proposal that makes it appear necessary to add fluoride to water and to suggest that neglect of the people is involved if it is not added. We should oppose the Bill on the sound principle of opposing mass medication and that it will not help the majority of people. Once past the age when second teeth are formed in childhood, Fluoridation will not help. The case for it has not been made. We should oppose the Bill, and in doing so we shall do a very good job indeed.
  10.40 pm
  Mr. Robin Maxwell-Hyslop: There are two points to the Bill— one of principle and the other of detail. On the point of detail, no one seriously challenges the fact that the presence of fluoride in water has a beneficial effect on dental caries. However, that is not the point at issue.
  Certain contraceptive pills were withdrawn not because they were inefficient contraceptives but because they had side-effects that were wholly unexpected by those who originally passed them as safe and recommended them for general use. The reason that Dalkon intra-uterine devices are now not only withdrawn but the manufacturers are desperately trying to find people who still have them in—some women do not know that they still have them—is not because they are inefficient contraceptives but because they have been shown to have harmful side-effects that were not anticipated by those who recommended them. Let us think of the position if they had been fitted—or, with contraceptive pills, administered—compul-sorily, because that is the analogy.
  The question is not whether fluoride—either naturally in the water as it percolates through the ground, or artificially added— is an instrument in delay ing or preventing caries. The technical issue is unanswerable except over a much longer period of time than has been allowed to date. What are the side-effects? That is the large question mark. No amount of evidence about the prevention of dental caries gets rid of that question mark.
  Arguments about whether elected local bodies should have the right to impose this medication are not ones of substance because the public water supply system is not conterminous with local authority boundaries. Therefore, that is not a practical consideration. It is the right of the

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  individual to know what is being administered to him or her or to their children, and to have the right to control that.
  There are peripheral questions. I put my vote where my mouth was when I took the view that water authorities should meet with the press present, but the water authorities that are party to the proposal meet in secret. They are not elected bodies. My hon. Friend the Member for Derbyshire, South (Mrs. Currie), who has now left the Chamber, pretended that because she was a member of an elected body and seconded by it to the health authority, in some way she was elected to the health authority. Of course she was not. Nor are people elected to health authorities today. But, even if they were, it does not overcome the point of principle. I am the first to admit that I have changed my stand on this matter during the past 15 years.
  When I was first contacted by members of the dental and medical professions, about 15 years ago, I became convinced of the efficacy of fluoride as an anti-caries agent, and it was on that that I focused. Because I thought that it would be an excellent thing if people did ingest this substance, to reduce dental caries, I took, without conscious decision, the further step of thinking that it should be administered to them by the public supply system. I did so without focusing on the question of principle, which concerns the right of some exterior body to administer in a necessary substance something that may have demonstrated beneficial effects in one sphere, but the full effects of which cannot be known over a limited period. Why in the water? Why not in the air or in trains, now that in many trains one cannot open a window? Why not in public places of many kinds, such as shops and offices? Why not administer gaseous substances in the air?
  Dr. M. S. Miller: Do not be silly.
  Mr. Maxwell-Hyslop: Why it is silly?
  Dr. Miller: Does the hon. Gentleman understand what it is all about? Fluoride cannot be administered in the air. It cannot be controlled in the air. It can be controlled in water to the extent of one part per million. Can you get that into your head? [HON. MEMBERS: "Order."] I am sorry, Mr. Deputy Speaker. The hon. Gentleman cannot understand that one cannot do this in the air.
  Mr. Maxwell-Hyslop: I am referring not to fluoride but to other substances.
  Dr. Miller: We are not talking about other substances.
  Mr. Maxwell-Hyslop: Perhaps it is a substance that would assist the hon. Gentleman with his hearing, which should be voluntarily taken by him, but I would not recommend that it should be compulsorily administered, whatever public good might follow from such a course of treatment.
  Both the chairman and the chief executive of the South-West water authority have assured me, not only verbally but in writing, that there is no conceivable known way by which they can restrict the administration to one part per million. There are so many different sources of water in the south-west— bore holes, extractions from rivers, springs and reservoirs—which feed at different speeds
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  into common mains and sometimes into local mains, that there is no way in which the authority can ensure a low limit such as this.
  The explanatory memorandum says:
  "Effects of the Bill on Public Sector Manpower The Bill has no effect on public sector manpower."
  Are water authorities not public services? They must be, because their borrowing is being restricted because it counts against the public sector borrowing requirement. Is it suggested that the fluoride administered from 20 or 30 different sources in one water authority should not be monitored? It will have to be monitored, but it is suggested that it will not take extra manpower to do this and to control and correct the level when the intensity gets too high. How can the Bill have no effect on public sector manpower, unless it be that the words on page 2—are they sinister or benign?
  "so far as is reasonably practicable"
  have the answer. Does that mean that ensuring that the level does not go over 1 mg per litre will happen only as long as no extra manpower is involved?
  Sir John Page: I have listened with great patience to my hon. Friend trying to make an enormous soufflé from one bad egg. I do not wish to go into this in too much detail, but the reason is that already so many chemicals and processes happen to water before it comes out of the tap that one more tiny drop would be of infinitesimal importance.
  Mr. Maxwell-Hyslop: My hon. Friend has missed the point. We are talking here about fluoride. Why does the Bill say, only of fluoride, that it must be maintained at 1 mg per litre if it does not matter if it is much more?
  Sir John Page: It does not say that.
  Mr. Maxwell-Hyslop: It does say that. Clause 1(5) states:
  "Any health authority making arrangements with a statutory water undertaker in pursuance of an application shall ensure that those arrangements include provisions designed to secure that the concentration of fluoride in the water supplied to consumers in the area in question is, so far as is reasonably practicable, maintained at 1 mg per litre."
  Perhaps my hon. Friend has not read the Bill. Why does it say that if it does not matter whether the level is maintained there?
  Sir John Page: I know that it was a mistake for me to have interrupted my hon. Friend. I was answering his question about manpower. As to the phrase,
  "so far as is reasonably practicable",
  there will be pluses and minuses. Control can be maintained, but there must be a tiny plus or minus on either side—[Hon. Members: "How much?"] Perhaps 0·1 per cent. or something like that.
  Mr. Maxwell-Hyslop: But it does not say 0·1 percent. It says nothing except for the meaningless phrase,
  "so far as is reasonably practicable".
  That is a point of substance, not of trivia. If
  "so far as is reasonably practicable"
  means without addition to public service manpower, that is a much wider margin than if one takes on, as one does for many statutory purposes, additional enforcement staff to ensure that the new conditions imposed by statute are adhered to. But when the explanatory memorandum says that there will be no expansion to public service manpower, how does one then read the qualification,
  "so far as is reasonably practicable",

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  except as meaning so far as is reasonably practicable without taking on additional manpower to check the concentration, to ensure that water supplies with too high a concentration are cut off, and to take corrective action on the input? Where there are many sources of water supply, especially in conditions of drought, when water is turned off for some hours in a day, which causes many different concentrations in pipes, this is not just a theoretical consideration but a highly practical one.
  The point of principle has nothing to do with whether it is a small or large baby—with whether it is 1 mg per litre, one part per million or 100 parts per million. The argument also falls on the point of detail that it cannot be enforced at the level declared in the Bill without a considerable increase in manpower to monitor it and to take corrective action if it goes over the permitted limit, even though the amount by which it can go over the permitted limit is not stated in the Bill, because of the woolly phrase.
  On the point of principle and on the point of practicality, the Bill ought not to proceed. The Second Reading of a Bill is not about its detail, but about its principle.
  Dr. M. S. Miller: Will the hon. Gentleman give way?
  Mr. Maxwell-Hyslop: The hon. Gentleman did not listen previously and, as he has not taken medication since then, I have no reason to believe that his hearing has improved.
  Dr. Miller: The hon. Gentleman must realise that no attempt has been made to mislead the public or the House. The Bill recommends 1 mg per litre, but one can be sure that 2 mg, 3 mg, 5 mg or 10 mg would not do any harm. There is a vast margin of safety. The reason why 1 mg is suggested is that it is sufficient. The substance costs money, and there is no point in adding 10 mg per litre if 1 mg does the job.
  Mr. Maxwell-Hyslop: Were that the real reason, rather than a spurious reason thought up by the hon. Gentleman on the spur of the moment, the Bill would refer to a minimum of 1 mg. The hon. Gentleman does argue that it does not matter if there is much more, but there must be 1 mg per litre to do what is intended. The principle is unaffected by whether it is 1 mg or 10 mg. The practice is certain: to monitor and enforce limits will require manpower, and it should not be stated that it does not. As it has been stated that no manpower is required, we must read the phrase
  "so far as is reasonably practicable"
  as meaning that the stated quantity is not to be adhered to in practice and is not to be monitored in such a manner that corrective action can be taken to prevent people from receiving excessive doses, as opposed to our knowing that people have taken excessive doses after they have done so.
  The point of principle remains and it is as true of air as it is of water. If this is permissible with water, it is permissible with air, and with other things that people necessarily and without choice ingest. That is the point of principle.
  Let there be as much health education as would satisfy the most exacting hon. Member; let there be as much exhortation; let supplies of preventive or therapeutic substances be made available at public expense. All that is different from administering compulsorily substances
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  that people do not wish to ingest—for reasons that may be good or bad, but which are decisions that they are at liberty to make about their own bodies and persons.
  10.59 pm
  Mr. Gerald Howarth: It is a pleasure to follow my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop), who is a master of detail in these matters. I am pleased to have him as an ally rather than as a foe.
  We all agree that the Government were right to allow a free vote. We have had an interesting, stimulating and informed debate— at least, the opponents of the Bill have been informed. It has been an interesting debate on the other side too.
  This is a matter of great concern to my constituents. The Cannock Chase district council is an elected body, although there are regrettably not too many Conservatives on it at present. It has declared itself hostile to the compulsory fluoridation of the water supply. I share its concern. I also have a particular interest in this subject, as a sufferer. I have been a patient at the Eastman dental hospital for the past two years, as I suffer from periodontitis. It is not caries, but is a dental disease. Therefore, I may have more interest than usual in this issue, and can speak with some authority on it.
  If the hon. Member for Makerfield (Mr. McGuire) did not regard his speech as an oration, many of us certainly did, and we look forward to hearing more from him in the spirit in which he has approached this subject. He rightly identified the question of principle involved, or the philosophical arguments, but there are also medical arguments. I shall deal with them first. Medical opinion has differed for years over whether the addition of fluoride to water supplies is a good way of reducing the incidence of dental decay, particularly among children. I understand that the idea of giving children supplementary fluoride to prevent dental caries dates from the 19th century, and was conceived after the discovery of fluoride in a mammoth tooth in 1803.
  Sadly, history does not relate which toothpaste the mammoth used or whether it was alive when it was discovered. But since then medical opinion has remained divided on how best to emulate the mammoth. Fluoride, as has been mentioned, is a poison, and we are talking about adding a poison to the water supply in quantities that exceed those already existing. Although many scientists and dentists believe that it can help to reduce dental decay, there are clearly those who do not agree with them.
  It is argued that although fluoride may help children for a limited period of their growth, it is injurious to the body and is a possible contributory cause of certain diseases, including— it has been suggested in some quarters— cancer. Indeed, dentists warn that there are positive dangers to young children from the excessive use of fluoride toothpaste. I think that those dangers will be exacerbated if fluoride is also to be added to the water supply.
  Mr. Winter, of the department of children's dentistry at the Eastman dental hospital, has made the following point:
  "Recent concern has been expressed about the possibility of young children ingesting sufficient fluoride toothpaste to result in dental mottling"—
  which we have already heard is a disease in itself—
  "This could happen by over-enthusiastic loading of the toothbrush by parents, or by young children gaining access to

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  toothpaste which they eat freely. While there is no direct evidence of dental fluorosis from the ingestion of fluoride toothpaste alone, it may contribute to the problem, especially if children have been given fluoride supplements since infancy."
  Mr. Winter goes on to say:
  "Further research is certainly required to clarify this matter."
  That is at the heart of the point made by those of us who oppose the measure. Further research is still required. We do not believe that the subject has been fully explored.
  In this debate Lord Jauncey seems to have been used much like the Bible. He has been quoted by all sides. But among other things, on page 79 he said:
  "Counsel for the Petitioner submitted that I could only reject the epidemiological case if I were satisfied that there was no possibility of fluoride causing cancer. I could not be so satisfied on the evidence in this case, and indeed proof of such a negative would be very difficult if not impossible."
  Another argument which he advanced was that fluoridation would probably cause dental fluorosis and mottling of the teeth, the first sign of fluoride poisoning. This is a medical opinion and proves that the weight of evidence is not wholly on one side.
  Fluoridation can also render water too impure for use in kidney machines. On that Lord Jauncey said:
  "I am not going so far as to state that no chronic renal failure patients with a kidney function reduced to 20 per cent. or less will ever suffer any harm from drinking fluoridated water. This is a possibility."
  He did not say that it was likely, but he did say that it was a possibility.
  Lord Jauncey continued:
  "I consider that the Petitioner is well-founded in submitting that drinking water fluoridated to one part per million can, in some circumstances, cause enzyme inhibition."
  Enzymes are vital to life's process, particularly for young children and the unborn. The inhibition of enzymes can cause birth defects, infant mortality and genetic damage. One of the major causes of cot deaths is a deficiency of oxygen-carrying enzymes. These are inhibited by fluoride. This is a possibility and no one knows definitely whether it is not so. The highest incidence of cot deaths in the world is in Australia, which is completely fluoridated. There is a possible connection.
  I do not argue that evidence exists that fluoride causes damage. I argue that there is evidence that the case is not proven, as my hon. and learned Friend the Member for Perth and Kinross (Mr. Fairbairn) said.
  In 1977, Chile ceased fluoridation because of the clear increase in infant mortality in areas subjected to fluoride in the water. Sir Arthur Amies, emeritus professor of dental medicine and surgery at the University of Melbourne, said:
  "The case against fluoridation medically requires only such evidence as is necessary to support a reasonable doubt. Where the public is concerned, no reasonable doubt can be ignored, and the doubt about fluoridation is more than reasonable, it is considerable."
  I am not a medical expert in these matters. I might benefit from further advances in dental medicine. However, the duty of the House is to examine the evidence worldwide. I do not believe that the case is proven. I do not believe that we have reached total certainty in medicine.
  The Parliamentary Under-Secretary of State for Scotland (Mr. John MacKay): The law of Scotland would have allowed Lord Jauncey to return a verdict of not proven, but he did not do that. I shall not bore my hon.
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  Friend by reading out his conclusions, but there is no doubt about them. My hon. Friend does Lord Jauncey a disservice in relation to his judgment.
  Mr. Howarth: I am grateful to my hon. Friend. The House will be grateful for the fact that he does not intend to read out the whole judgment by Lord Jauncey. I am aware of Lord Jauncey's conclusions, but we must take cognisance of the points that emerge from those conclusions. The case is not 100 per cent. proven.
  Mr. John Patten: My hon. Friend has drawn heavily on supposed evidence from Australia. Will he recognise that the supposed link between cot deaths and fluoride was closely examined by the health and medical research council in Australia, which in 1979 definitely found that there was no such link? Secondly, will my hon. Friend recognise that Sydney, which has had fluoridated water since 1968, has the lowest incidence of cot deaths anywhere in that continent?
  Mr. Howarth: I am grateful to my hon. Friend. The fact is that Australia does have the highest incidence of cot deaths. However, I accept my hon. Friend's point and I am sure that the House will appreciate his having taken that opportunity to make it.
  My principal point is that made by the hon. Member for Makerfield and several of my hon. Friends. Even if the medical evidence were completely in favour of the addition of fluoride, there remains a deep-seated philosophical argument against it, as advanced by my hon. Friend the Member for Ynys Môn (Mr. Best). That argument is akin to the seat belts argument, which has also been mentioned. If I had been a Member of the House at the time it considered whether to make the wearing of seat belts compulsory I would have voted resolutely against it. I wear seat belts everywhere I go in a car, but I am resolutely opposed to making people wear them against their wish. That is not part of Conservative philosophy, nor is it part of Conservative philosophy to put medicines in the water supply.
  I shall not go further into the arguments about the addition of chlorine, and so on, which is to make water pure, and the addition of something which has been added for one specific purpose only, which is to resolve the problem of dental decay.
  Mention has been made already, somewhat unfairly I am sorry to say, of the confirmation that was given some years ago by my hon. Friend the Under-Secretary of State; no doubt he will refer to that when he replies.
  Dr. M. S. Miller: If, at some time in the future, a group of scientists were to say that for the past 20 or 30 years they had been working on a substance which, if added to water in small quantities, reduced the incidence of coronary thrombosis by 10, 20 or 50 per cent. but which many experiments had shown did not produce any ill-effects, would the hon. Gentleman look favourably on introducing that substance into the water?
  Mr. Howarth: That is a hypothetical question. It would depend on whether there were other means of treating the ailment or whether the treatment could be taken in some other form.
  The fundamental point of principle is that if something were added to the water supply which helped 10 per cent. of those who suffer from coronary thrombosis, one would have to examine the other options. If there were none, I

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  should have to consider that. I hope that I do not have a closed mind on such matters. However, a fundamental principle is about to be breached, and I do not wish to be a party to that.
  If the measure goes through, people will not be able to decide for themselves. Henceforth, they will have no choice but to take fluoride in the drinking water and with their cooking.
  Moreover, fluoride has side effects, or at least some feel that it does. We do not know how many suffer from side effects caused by fluoride in the water supply. All I know is that one of my constituents feels that he has suffered from fluoridated, contaminated water in Wales. He was ill as a consequence. Others have had similar experiences. I suppose the advice to him would be to move his holiday home from Wales to Northern Ireland which is excluded from the Bill and continues to enjoy a water supply unfettered by the compulsory addition of fluoride.
  Those who believe that fluoride helps to reduce caries have plenty of alternative options open to them. They can use a mouth rinse, or toothpaste, 98 per cent. of which contains fluoride. People have a choice. I can still buy toothpaste that does not contain fluoride if I wish. Or they can take the tablets which I have here in my hand. My wife and I gave those to our children because we believed that that was the right thing to do although we have stopped doing so because we now have doubts about the matter. But that decision was up to us as parents with an informed view. Incidentally, if a child took all the tablets in one go, serious danger could result. [Interruption.] Whatever is said, this is a medicament being put in the water supply.
  There is the possibility that milk can carry fluoride. The Borro Foundation provides that service, and when I asked the Secretary of State for Education and Science if he thought there was a case for making that service available to school children—from choice, not compulsorily—he replied that he did not have that in mind.
  We must not lose sight of the cost. It will cost £500,000 in the west Midlands to fluoridate the water supply. That money could be better spent increasing the amount of money available to dental hygienists. Indeed, a dental hygienist has done more for my teeth than fluoride tablets or any other medicament.
  Trouble with children's teeth results from the fact that parents are not teaching then how to brush their teeth and what to eat. Too many parents buy off their children in the supermarket, giving them too many sweets, and we know how bad sweets are for teeth. The hon. Member for Makerfield pointed out that dental hygiene can resolve the problem. If people take all the fluoride in the world—in the appropriate doses, of course—but do not properly maintain their teeth, we shall still have a nation suffering from dental decay.
  In my view, the medical case has not been proven beyond all doubt for a gigantic step of this nature, which will result in every person being obliged to consume fluoride, unless the water is taken out of a bottle. This is the thin end of the wedge. We shall be setting a dangerous precedent which we shall rue in the future. I hope, therefore, that hon. Members in all parts of the House will join me in voting against the Second Reading.
  11.18 pm
  Mr. Alan Williams: Even if fluoridation were proved to be absolutely safe and even if it were claimed to be a treatment for complaints far more
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  serious, I should still insist that the House must address two major issues which overwhelm the poor arguments we have heard in favour of fluoridation.
  The first is that of compulsory mass medication versus individual choice. The second is that of democratic decision versus bureaucratic imposition. I am surprised that the occupants of the Government Front Bench, unlike many of those sitting behind them, can have the effrontery to suggest that there is even a question to be answered on the issue of democratic versus quango decision. as they, after all, occupy their present elevated status after fighting two general elections on manifestos opposing quangos, insisting on the need to cut back on them and to diminish their authority. I assume, therefore, that the democratic argument is established.
  We come to the argument of democratic choice. There is a major difference between adding substances to water to make it drinkable and adding substances for any other reason. It is difficult to explain why teeth complaints should be treated differently from any other form of medical hazard that faces us. A person can discharge himself from hospital—
  Dr. M. S. Miller: I ask my right hon. Friend to be more careful about definitions. He has talked about drinking water, but any water is drinkable. He was referring to water that is safe to drink. Any water that is not fluoridated is not safe to drink.
  Mr. Williams: We are talking about the compulsory and unnecessary adding of fluoride to drinkable water in areas where it is not added now, one of which I represent. I have opposed, successfully until now, the introduction of fluoridation in my constituency. As others have said, we no longer insist on vaccination, even against killer diseases. We do not force feed those who decide that they will allow themselves to die through starvation. We do not impose medication in any form on others unless a special legal process has been undertaken through the courts.
  The hon. Member for Ynys Môn (Mr. Best) made a legitimate point when he asked why we had not banned smoking. It was suggested that we have not banned it because people like to smoke. I ask my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) to pass me a glass of water.
  Mr. Frank Dobson: I pass my right hon. Friend a glass of water that is guaranteed fluoride-free—but I have spat in it.
  Mr. Williams: It has been said that we should not ban smoking because people like to smoke. We have said to those who like to smoke marijuana that we shall not allow them to do so. We have recently imprisoned someone who liked taking cocaine. It seems that it was not his intention to peddle it to others but to take it himself, and we said that he should not do so. That argument is not tenable.
  The hon. Member for Ynys Mon advanced legitimate and worrying arguments about precedent. If I had not been worried about the arguments before I heard what he had to say, and if I had not been convinced by his remarks, I would have been convinced of his case by the interjections that he had to face from those who disagreed with him. There were those who referred to antacids and said that we cannot add antacids to water. That is not the issue. The question is whether we would do so if we could. The imputation is that some hon. Members would. Should we

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  accept additives to water for certain heart conditions? There are those who say that they would if it were possible to do so. The list is lengthening.
  The hon. Member for Ynys Mon asked about the possibility of adding tranquilisers and there was the interjection "Why not?". When it was suggested that there could be the introduction of certain chemicals via the air, the argument was raised that that would not be controllable. That means by implication that if it were controllable it would be acceptable.
  What makes the avoidance of minor problems of the teeth—
  Dr. M. S. Miller: Minor?
  Mr. Williams: Yes, minor problems. What makes them more important in health terms than any other health consideration? If fluoride is so effective, the duty in a democracy is not to impose it on people but to make people aware of the benefits available to them by using fluoride in some other form. The duty is not to impose fluoride but to allow people to make a choice. I am opposed to the Government's proposal because it does not give people that choice.
  11.25 pm
  Sir Ian Percival: I have listened to almost the whole of the debate and with great interest, and on occasions I have been impressed by some of the arguments of those in favour of the Bill. However, having listened to it all, I come to the opposite conclusion, and shall vote against this legislation.
  The subject with which we are dealing can be reduced to simple propositions. My right hon. and learned Friend the Minister for Health rightly described the process of adding fluoride to water as "preventive medicine" and "a public health measure". The purpose is to prevent damage to health which might be suffered by some people, and it is no good anyone seeking to put that any other way.
  It is equally clear that fluoridation is compulsory mass medication. We must all drink water, so if the water in our area is medicated, we must drink it—whether or not it will do us any good and, indeed, in the knowledge that many people cannot possibly obtain any benefit from it. The question we have to face is whether any arm of authority should be given the right to subject all the people in a given area to that medication so that those who might benefit do so?
  On the face of it, the most powerful argument was that unless we do fluoridate the water, young people might be denied the opportunity of having less trouble with their teeth. My hon. Friend the Member for Cannock and Burntwood (Mr. Howarth) demolished most of that argument, so that I need refer to it only briefly. There are other ways of obtaining for our young people the benefit of fluoride's value— toothpaste, tablets, and so on. What is really being said is: "Because we do not trust parents or health authorities to do the right thing, we must step in and wet nurse them to ensure that the young people get that fluoride although millions of other people who do not receive any benefit will have to drink the fluoridated water as well." The House must face that issue in deciding whether to pass this legislation.
  I have been a Member long enough to pay great attention to the views of the right hon. Member for South
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  Down (Mr. Powell). I was impressed by the fact that, although the points I made are well known to him, he came to a different conclusion. I respect his concern for freedom of the individual. His concern is as great as that of any one else. The right hon. Gentleman nearly, but not quite, persuaded me.
  Further, even if the arguments of the right hon. Member for South Down were sufficient to overcome those hurdles, there is one more which is conclusive. If any arm of authority were to be given the right to take this action, it must be a democratically elected body to which the electors can make known their views. If that body acts contrary to the views of the electorate, they can exercise control in the next election. Nothing short of that process will do. Since it is central to the Bill that a health authority is the body to which the right is to be given—and as that is by no stretch of the imagination an "elected body"—that consideration is fatal to the Bill. I shall vote against the Bill, and I urge my right hon. and hon. Friends to do so also.
  11.29 pm
  Mr. Edward Leigh: I have a few questions to ask the Minister, which I can put in literally two minutes.
  First, given that every human being is largely made up of water, has not every individual a right to drink water the treatment of which has been limited to cleaning? Secondly, is the fact that fluoride occurs naturally somewhere, an argument that it should be imposed on everyone everywhere?
  Thirdly, accepting that water itself does not cause decay and that people cause decay to their teeth by their eating habits, what is the logic in saying that their eating habits should be exercised according to choice, and their drinking habits according to compulsion? Fourthly, are there not ample opportunities for individuals to apply fluoride to their own teeth?
  Fifthly, if it is said that the decision to administer fluoride should be made locally, is it not right that water and health authorities are appointed and not elected? Sixthly, if fluoride is considered desirable, why should not other drugs, substances or chemicals be applied? Why should the line be drawn after fluoride? Where is the logic in that?
  Seventhly, is it not a fact that far from fluoride benefiting everyone, it benefits only some, that is, children? Eighthly, is it not true that some doctors and researchers still have doubts about the safety of fluoride? Is it right, therefore, to make it compulsory?
  Ninthly, is it not true that whether or not fluoride is dangerous, some people still consider it to be dangerous? Some of my constituents said to me that it affects their health. Why should they be forced to take it, even if their fears are groundless? Tenthly, do not people have the right to choose?
  11.31 pm
  Mr. Ivan Lawrence: I sense some restlessness in the House and know that all hon. Members wish to draw the debate to a conclusion. I hope that I shall not be criticised if I do not attempt to make the definitive anti-fluoridation speech.
  I hope that that is not a misjudgment, because I cannot help feeling that the Government have misjudged the debate. The first misjudgment was that the debate would

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  achieve so little interest that it could begin at 7 o'clock and be expected to end at 10 o'clock. That may show that the Government are not with it regarding public feeling about the fluoridation issue. The second misjudgment relates to my hon. Friend the Parliamentary Under-Secretary who, at one stage, so misjudged his prospects that he thought he would never become a Minister, still less a Minister in the Department of Health and Social Security, and committed himself to a document supporting the antifluoridation case.
  I shall address myself to some points that have recurred during the debate. The first relates to the question of the safety of fluoridation. It is perfectly clear that some people consider fluoride to be absolutely safe. The Minister for Health told us that a massive amount of research was examined by his advisers, whose conclusion, that there is no jot or tittle of reliable evidence to show that fluoridation is safe, and can be relied on. For every expert, scientist or doctor who has committed himself to writing to say that there is no evidence to suppose that fluoridation is unsafe, I can produce a doctor, scientist or expert who has produced a report to say that it is unsafe.
  Furthermore, I draw the attention of hon. Gentlemen who support the Bill and say that Lord Jauncey in a lengthy case has come to the conclusion that it is safe, to three judges who have held the contrary view. In May 1982 Judge Ferris, hearing a case in Houston, said that artificial fluoridation of public water supplies
  "may cause or may contribute to the cause of cancer, genetic damage, intolerant reaction and chronic toxicity, including dental mottling in man…and may aggravate malnutrition and existing illnesses in man."
  That is the decision of a judge who heard the same kind of evidence from the same kinds of witnesses as produced the alternative conclusion from Lord Jauncey.
  In Illinois, Judge Ronald Niemann said that
  "the artificial addition of fluorides to the public water supply may have adverse health effects"
  and that it
  "exposes the public to a risk, uncertain in its scope, of unhealthy side effects".
  That was in February 1982, and that is contrary to the conclusion reached by Lord Jauncey.
  In Pittsburg. Pennsylvania, in 1978, Judge Flaherty said that
  "artificial fluoridation of public water supplies is deleterious to human life and health."
  He was considering precisely the same sorts of witnesses as Lord Jauncey considered.
  That is not all, for at the end of a 210-page report, prepared for the Ministry of the Environment in the Province of Quebec in 1979 by an advisory committee which consisted of a number of experts, it was said of the fluoridation of water that it
  "poses serious dangers to health and has not proved to be a very effective deterrent to dental caries".
  I draw those judgments to the attention of the House, and I shall not weary the House with a long list of research projects throughout the world which indicate that fluoridation is unsafe for all kinds of reasons. I merely make the point that it seems to me that we in this House are not fitted to make judgments of scientific detail and that, where leading scientists cannot agree that fluoridation is safe, there must be a doubt.
  The chlorination of water saves people from dying of typhus or some other illness, and one assumes that everyone is in favour of chlorination, but here we are
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  dealing only with the reduction of dental caries in children's teeth. It may be painful. but it can be reduced by a number of other means, as we have heard.
  We have heard an argument about whether fluoridation is beneficial. I do not propose to go into that in any great depth. but the figures produced by scientists to show that there has been a beneficial reduction in dental caries in children's teeth since the introduction of fluoride in this, that or the other area, can usually be interpreted in two ways.
  Reference has been made to the Birmingham figures. All one can say about those figures is that since fluoridation there has been a threefold increase in the number of temporary fillings, and that in permanent fillings there has been neither an increase nor a decrease, despite many years of fluoridation.
  Most of the conclusions that have been drawn in favour of the beneficiality argument have been on the most fallacious of all logical inaccuracies— post hoc ergo propter hoc: that because since the introduction of fluoridation, there has been a fall in caries in children's teeth, therefore that fall is due to fluoridation. The problem with that argument is that in some parts of Britain where there has been a comparable decline in dental caries in children's teeth—I cite particularly the Isle of Wight—there has been no fluoridation of the water supply. That leads one to the conclusion that it may well be that more attention to the brushing of teeth, more attention to diet, and more attention to the consumption by children of sugary substances, may have much more to do with the reduction of dental caries in children's teeth than the fluoridation of water has ever done.
  I shall not labour the point, but I do not concede the argument— whether it has been made by my hon. Friends or Opposition Members— that it is beyond peradventure that the fluoridation of the water supply benefits teeth. It is very much a question of doubt whether it does. We know that it hardens the teeth. Whether it improves them or delays the onset of dental caries for longer than two years, which is what one scientific report in Britain said, one does not know, but it has not been proved beyond doubt.
  My right hon. and learned Friend the Minister for Health began by telling us that he, his officials and his experts had been into the the question of fluoridation with such great care that we could rely upon them, because no stone had been left unturned and they had investigated every criticism that had been made. The trouble is that they have totally neglected to do any research into the one really important aspect of the effect of fluoridation—how much of a dose anybody will receive.
  We do not all drink the same amount of water, at one part per million. We do not all drink beer or tea that has fluoridation. We do not all eat the same food that has been treated or processed with fluoridated water. There is at least one professor in this land who says that the cumulative effect of cooking and processing food in fluoridated water deposits a far higher degree of fluoride in the bones than anybody imagines. It is cumulative, and is not passed out of the system. Nobody knows how much fluoride we ingest through the air when we breathe.
  Therefore, since it is conceded that fluoride ingested into the system at two, three, four or five parts per million can be highly poisonous, and since nobody knows or could possibly know how much fluoride there is in the system in any dose, which is an area of research upon which little

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  work has been done, that gives no confidence and should not inspire any confidence in us that a great deal of work has been done on one or two other issues.
  We have discussed whether the measure is democratic, undemocratic or does not matter. I can only recount some experiences from my part of the country, where the Severn-Trent water authority and the South Staffordshire water works company decided, on the demand of the area health authorities, to fluoridate the water. The Government said that they would wish it to be fluoridated only with the consent of the local people concerned, but when the democratically elected Staffordshire, Shropshire, Gloucestershire, Herefordshire and Worcestershire county councils said no, that was ignored by the water and health authorities. When the district councils of Newcastle-under-Lyme, Stafford, South Staffordshire, East Staffordshire, Lichfield, Cannock Chase, Tamworth and Stoke-on-Trent in Staffordshire all said no, that was ignored by the water and health authorities, which knew better. Oswestry, North Shropshire, South Shropshire, Shrewsbury and Atcham, The Wrekin, and Bridgnorth in Shropshire all said no. Malvern Hills, Wychavon and Worcester in Hereford all said no. Whenever a responsible public opinion poll has been taken, which refers to matters other than saving the health of people's teeth, and people have been asked whether they want the water to be fluoridated, everybody has said no. There is absolutely no doubt that the overwhelming majority is against fluoridating the water.
  There have been all sorts of bogus polls. We are taking the powers away from democratically elected people and giving them to water and health authorities, which not only are not democratically elected, but are removed from the locality. That is no answer. To pretend that that is democratic is bogus. We know perfectly well that representative bodies have been appointed in the USSR, but no one on the Front Bench would call that a democratically elected state. The argument about democratic elections and the will of the people is highly significant and militates against the Bill.
  Finally, there is the question of freedom. When I first came to the House I could not have cared less about fluoridation. I then sat on the Select Committee and found that witnesses who assured us that fluoridation was beneficial and safe could not answer simple questions to show that they knew what they were talking about. Only then did I begin to smell a rat and to realise that there was more to this than we had been led to suppose. People who are worried about this are concerned, above all, whether it is an infringement of their freedom. In this context, it was sad to hear the right hon. Member for South Down (Mr. Powell) trying to justify a decision that he made many years ago on the ground that fluoridation was not mass medication. He and I have fought together in various battles, notably with regard to seat belts. I see no significant difference between the interference with individual' liberty in that case and in the individuals decision as to whether he or his children should take a particular medicine.
  Others have argued that only a tiny bit of freedom is involved, so it does not really matter. That is exactly the argument that we had in relation to seat belts. There is no such thing as a tiny bit of freedom. There is the principle of freedom or no freedom. It is a seamless web, and degree
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  is irrelevant. What matters is whether we are prepared to stand up for the liberty of the individual, which can so easily be eroded. If Governments are allowed to say, through the medical authorities, not "This is a medicine that we advise you to take "but "This is good for you and you must take it", who can say where that will lead? We should be saying, "This is good for children's teeth and, even though you are not a child, you will take it", and "Even though you have no teeth, you will take it. but that is only a little infringement of liberty because people without any teeth cannot possibly be harmed by it."
  John Stuart Mill said that the individual is sovereign over his own body and mind, and I believe that the right hon. Member for South Down has made similar references to the importance of safeguarding small freedoms. If we infringe freedom in this way, where will the process end? Will doctors tell us that because in their view it is good for us to take vitamins— tranquillisers, stimulants, contraceptives or whatever— we shall have to take them? Once we give that kind of licence to administrators, very little of our freedom will be left in a very short time.
  That is no doubt why of all the countries of Europe which might be expected to fluoridate their water, if it were as beneficial as we are told, only the United Kingdom and Eire do so. Austria, Greece, Norway, France and Spain do not. Belgium, Holland, Germany and Sweden used to do so, but have stopped, as have hundreds of cities in the United States.
  I invite the House to accept the overwhelming strength of the arguments against the Bill and to vote against it. I remind my hon. Friends that it is a free vote. I hope that members of the Government will bear in mind, too, the sensitivities of those in the Government who in the past, on the question of freedom, if on no other issue, have expressed their opposition to the proposition in the Bill.
  11.50 pm
  Mr. Ray Powell: I do not intend to detain the House for long. I have listened to most of the debate and I think that most of the points at issue have been well and truly covered.
  When I found myself in agreement with the hon. Member for Ynys Mon (Mr. Best), I thought I had better leave the Chamber and read my notes to determine whether I would be going into the right Lobby. I must say that I share the sentiments that he expressed. Indeed, many Conservative Members have expressed the right and proper view on the Government's introduction of this proposal.
  A few questions have been overlooked. One is that the Bill suggests that the public water supply is maintained at 1 mg per litre. The Minister is a past Welsh water authority employee of 10 years' standing. I ask him how it is possible to measure that degree of fluoridation in a reservoir, or in the water supply at the outset, when there is a drought? Recently reservoirs in Wales dropped to 10 per cent. of their normal capacity, and there would have been great difficulty in measuring the degree of fluoridation in such a position.
  Mr. John Patten: The Department of the Environment regularly checks the fluoride levels in reservoirs. I am advised that there is no danger whatever of adverse levels of fluoride creeping into water supplies either during a drought or at any other time.
  Mr. Powell: That might be what the Minister says, but it is not my information from chemists within the water industry. There is great difficulty in ensuring that that can be done. The consumers will never have the guarantee that that will be the level of fluoride in the water that will come out of their taps. There are a number of reasons for that, and the matter needs further investigation.
  The Bill suggests that no additional public expenditure will be involved. If we add a substance to a water supply, who pays for it? Will it come from public expenditure? If it comes from the water authority budget, that is obviously public expenditure.
  The decision whether fluoride should be added to the water supply will he made either by the health authority or by the water authority. I have listened to a number of speeches, especially those of the hon. and learned Member for Burton (Mr. Lawrence), the hon. Member for Ynys Mon and my right hon. Friend the Member for Swansea, West (Mr. Williams). Most Conservative Members were opposed to quangos when the Government took power in 1979. Indeed, in 1979 the area health authorities and the water authority in Wales were far more democratic than they are today. Elected representatives of local authorities served on both bodies in 1979, but some of those positions have now been filled by appointments made by the Secretary of State for Wales. Therefore, it is not elected bodies that are making decisions. The hon. and learned Member for Burton covered a number of points when he asked how many elected councils—borough, district and county—that have opposed the adding of fluoride to the water supply have been overruled by quangos.
  I shall vote against the Bill primarily because, as other hon. Members have said, it is the basic individual right of the individual, and the public in general, to determine whether or not to have fluoride in his water. Therefore, all hon. Members should be going into the No Lobby, to show the Government quite forcefully that we have no intention of allowing this measure to be passed.
  11.55 pm
  Mr. Frank Dobson: I have to tell my hon. Friend the Member for Ogmore (Mr. Powell) that I for one will not be going into the No Lobby, because I support this limited measure.
  I start by declaring an interest—I do not like going to the dentist. I never did like going to the dentist, and I do not wish the pain and suffering of going to the dentist on anyone else and, above all, on children. I am firmly of the opinion that a vote for this Bill is a vote against a child's toothache. Those hon. Members who wish to vote against it should bear that in mind.
  Some hon. Members came to the debate late and said that they had not heard arguments that fluoride in water does helpfully affect children's teeth. If they had listened to the Minister, to my hon. Friend the Member for Oldham, West (Mr. Meacher), or to other right hon. and hon. Members at the beginning of the debate, they would have heard a vast and adequate array of information, which should have convinced anyone who was prepared to be convinced. Although I may be tedious, I have no intention of being repetitious, and I shall not go through points that were made at the beginning of the debate. Those points are wholly convincing, and the evidence from a place as close as Birmingham is especially convincing to me and to anyone who looks objectively at the evidence. There have been massive improvements in
  130
  the health of children in Birmingham, directly and only as a result of the introduction of fluoride into the water in and around that city. Those who spoke earlier showed that in the quantities proposed, fluoride is not injurious to anyone's health.
  Fluoride, it has been said, is available from other sources. It can be applied by a dental technician or a toothbrush. It can be provided by tablets, as waved at us by the hon. Member for Cannock and Burntwood (Mr. Howarth). I note from the Times parliamentary guide that he is listed as an international banker. The well-off and well-informed international bankers of this world may have the information to lead them to give the tablets to their children to make them free from dental caries. The hon. Member for Cannock and Burntwood, and every other hon. Member, has an obligation to the children of the worse-off, and worse-informed, who are likely to get fluoride only through the water system. My hon. Friends should bear in mind the condition of the teeth of the worstoff in their constituencies before they vote against this limited measure.
  Mr. McGuire: Is my hon. Friend seriously suggesting that if fluoride is added to water, those poorly off children can forget about dental hygiene—[Interruption.] I am asking my hon. Friend whether he believes that there is any benefit in neglecting dental hygiene.
  Mr. Pavitt: It is a first step.
  Mr. Dobson: For a start, if during pregnancy their mothers drink water with fluoride added to it, their milk teeth will be in a better condition. There is no other way of getting that fluoride into the system. Secondly, we all know— even my hon. Friend the Member for Makerfield (Mr. McGuire) knows—that the worse-off and the worst-informed members of the community have most difficulty in developing eating and cleansing regimes properly to look after their teeth. We must bear that in mind when we discuss this matter.
  Some people believe that this is a trivial matter. and that because dental caries does not kill people outright—I understand that it can indirectly lead to death—it is not worth the candle. However, some hon. Members would jib even at the idea put forward by my hon. Friend the Member for East Kilbride (Dr. Miller): that if we discovered an element that was completely safe, and that prevented heart disease or cancer, we should put it in the water. Some hon. Members might change their minds if they heard of such an element, but others would still say that it represented terrible, compulsory mass medication.
  Other hon. Members have talked about this being an invasion of civil liberties. I do not have the document with me, but I can refer hon. Members to it and they can look it up later: in the city records of Nottingham we discover that the self-same arguments that have been mounted tonight against the introduction of limited quantities of fluoride in water were used by the semi-elected lord mayor and several aldermen in the 19th century, when the first medical officer of health said that we needed a decent clean water supply to get rid of typhoid and cholera. Those people talked about it being an invasion of people's rights to provide them with something that would stop them getting sick, but it was a step forward from which we have all benefited.
  Most Conservative Members would bow to the right hon. Member for South Down (Mr. Powell) as an ardent

  131
  champion of civil liberties from a Right-wing point of view. They were rather disappointed when he, in his prophetic mood and reminiscent vein, rose tonight. I wish to reply in kind. The prophet arose and his erstwhile admirers flocked to hear him speak, but they were cast down and sorely disappointed, for verily did he speak in favour of fluoride and made it clear that he intended to pass by on the other side. The right hon. Member for South Down did confess that he was the Minister for Health who helped introduce artificial fluoride into water; he said that he was pleased that he had done it, and he believed it to be justified. That at least is clearly not a matter that he does not wish to be revealed by the operation of the 30-year rule on Government documents.
  We have also heard the argument that there is no choice for those who drink water that has had fluoride introduced into it. But in the past, as part of the system of preventive medicine, we have given people no choice. There used to be no choice with some vaccinations. It was decided, rightly, under the powers given by the House, that some diseases could be eradicated only if vaccination were compulsory. Those schemes were successful. Contrary to what was suggested by some Conservative Members, that was not done only to provide protection for the person who was vaccinated. It was also intended to ensure that he or she did not pass on a disease to someone else. Some Conservative Members have claimed that we have had no system of preventive medicine in which there was no element of choice. That has happened; society has insisted that it was right to protect everyone by compulsory vaccination.
  None of the opponents of the Bill can deny that a legion of chemicals are introduced into the water supply to make it clean and to stop the water making people sick. All that we are saying is that dental caries will be coped with if limited quantities of fluoride are put in the water.
  I support one aspect of the civil libertarian case. I object to the idea of someone in authority introducing a substance into the water supply without public consultation or knowledge. It would be useful if the Government agreed to accept amendments in Committee to provide that if a health authority wished to recommend to its water authority that fluoridation should be introduced, that health authority's debate should take place in public and that the same should apply to water authorities.
  Mr. Best: If the Government do not do that, will the hon. Gentleman vote against the Bill?
  Mr. Dobson: No. If Conservative Members are so worried about that aspect of water authorities' activities, I hope that they will vote for the Water Authorities (Meetings) Bill which has been introduced by my hon. Friend the Member for St. Helens, South (Mr. Bermingham).
  The Bill before us is a limited measure. Many people strongly believe in extending preventive medicine and think that the law should not merely be declared to be what everyone has thought it to be, but should be changed so that if a health authority asks a water authority to put fluoride in the water supply, the water authority should be compelled to comply.
  The Bill does not go that far. It simply reasserts what everyone has thought to be the law. If it is not approved, areas such as Birmingham, where people are already
  132
  benefiting from the introduction of limited quantities of fluoride, will no longer enjoy that benefit. I hope that most of my hon. Friends will join me in voting for the Bill.
  12.8 am
  The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): We have had a long and interesting debate, which Ministers from the DHSS, the Scottish Office, the Welsh Office and the Department of the Environment have followed carefully.
  Three threads have run through the debate— the benefits or otherwise to dental health of adding fluoride to the water supply, the safety of adding that mineral to the water supply and the important issues of personal freedom and liberty. I do not underestimate the strength of feeling of many of my hon. Friends on those issues.
  I have noted with care what was said by my hon. and learned Friend the Member for Perth and Kinross (Mr. Fairbairn), my right hon. and learned Friend the Member for Southport (Sir I. Percival) and my hon. Friends the Members for Ynys MÔn (Mr. Best), for Tiverton (Mr. Maxwell-Hyslop), for Cannock and Burntwood (Mr. Howarth) and for Gainsborough and Horncastle (Mr. Leigh), though I doubt whether I shall be able to answer all 10 of the points put by my hon. Friend the Member for Gainsborough and Horncastle.
  Last but not least I must mention the points so powerfully made in support of the arguments of personal liberty by my hon. and learned Friend the Member for Burton (Mr. Lawrence), who is a powerful advocate of the case against the sort of addition to the water supply that the Bill attempts to establish.
  But just as I appreciate the arguments with which I do not agree, I welcome the support given to the Bill by right hon. and hon. Members from all parties, with the exception, I believe, of the SDP whose voice we have not heard. We had detailed support from the right hon. Member for South Down (Mr. Powell), who wound back the clock and told us what made him, as a former Minister for Health, decide in favour of this form of addition to the water supply despite his deeply held views about the doctrines of personal liberty. I also welcome the support given by my hon. Friend the Member for Harrow, West (Sir J. Page), and by the hon. Member for Leeds, West (Mr. Meadowcroft) on behalf of the Liberal party—that party also seems to have a free vote tonight—as well as by my hon. Friends the Members for Bournemouth, East (Mr. Atkinson) and for Derbyshire, South (Mrs. Currie) and by the hon. Member for Brent, South (Mr. Pavitt).
  In my brief concluding remarks, I shall deal with each argument in turn. I have not heard any hon. Member advance any argument tonight that would lead me to move one jot or iota from giving my full support to what my right hon. and learned Friend the Minister said in advancing the powerful case in support of dental health. It would be otiose to repeat the arguments that he has already put so well. Those arguments have received support from the hon. Members for Holborn and St. Pancras (Mr. Dobson) and for Oldham, West (Mr. Meacher). I just hope that the general management committee in the constituency of the hon. Member for Oldham, West does not read Hansard and see that he is commended and supported by the right hon. Member for South Down. I do not know how well that would go down in Oldham, West.
  I do not quite know what the oft-quoted Lord Jauncey would make of all the ways in which gobbits and bits of

  133
  his opinions have been used by right hon. and hon. Members, sometimes in favour and sometimes against the Bill. But one fear consistently underlying the debate on dental health was that somehow the addition of fluoride to water—whatever benefits it might have—would lead to dental mottling. In his judgment after the longest legal case in Scottish history lasting 201 days, the learned judge said:
  "there is likely to be a very small increase in the prevalence of mottling of a type which will only be noticeable at very close quarters and which is very unlikely to create any aesthetic problems for the owners of the teeth."
  The learned judge was absolutely right in his judgment.
  I come to the important issue of safety. Again, I stand four square behind everything that my right hon. and learned Friend the Minister had to say. The whole scientific community constantly and rightly keeps any additions to our diet or water supply, and any forms of new or old drugs that are available on the market, under surveillance. Any scientist worth his salt would move very fast to publish any damning evidence that shed light on the safety, or lack of it, of any substance freely available on the NHS, or available privately. No such evidence has been forthcoming from any quarter in this country or abroad.
  However, my hon. Friend the Member for Ynys MÔn asked several detailed points, to which I shall respond. He said that Lord Jauncey had suggested in his judgment that perhaps fluoride should fall within the ambit of the Medicines Act 1968. Lord Jauncey did not accept that supply without a products licence would be in breach of the Medicines Act and rejected that part of the petitioner's case based on alleged contravention of the Act. That is made clear in his summing-up.
  My hon. Friend the Member for Ynys MÔn also referred to the indemnity of water authority employees if safety is challenged. The indemnity offered in respect of alleged harm to health is primarily to assist water authorities, which cannot be expected to judge safety issues. That is a health question and the offer of indemnity is a clear example of the Government being prepared to put their money where their mouth is.
  Mr. A. J. Beith: The Minister made an odd statement when he said that the safety aspects cannot be left to the water undertakers but must be dealt with by the health authorities. Does he recognise that the addition of fluoride to the water supply is done by water authorities at many separate sites, some of them small and unmanned and which are monitored only from time to time? Surely water authorities and statutory undertakers have a heavy responsibility. If the Minister says otherwise he will seriously mislead them.
  Mr. Patten: I wish that the hon. Member for Berwick-upon-Tweed (Mr. Beith) had been here earlier to hear the whole argument. I gave way only to ensure that he votes with the Government this evening. The health authority is responsible for deciding whether the addition of fluoride to water is in the public interest. That is the answer to the hon. Gentleman's question.
  Safety issues have been tested in courts of first resort, middle resort and last resort round the globe. My hon. and learned Friend the Member for Burton discussed three cases of judges ruling against the safety of fluoride in the United States. None of the cases were in courts of last resort. No court of last resort in the United States has ruled
  134
  against fluoride. The issue has been taken to the Supreme Court eight times and on each occasion the safety of fluoride has been advocated by the judges involved.
  On safety grounds, as on the benefits to dental health, the Government's case is sound and has been carefully composed. My right hon. Friend the Secretary of State and I would be the first to come forward if there were any doubts at all about safety.
  I had doubts about the safety of fluoride in the 1970s.—[linterruption ] I think that I have been caught by the 10-year rule. That remark has caused interest among my hon. Friends, so perhaps I should attempt to explain. In the 1970s a report by the Royal College of Physicians exonerated the addition of fluoride to the water supply. I accepted that. Shortly after, the work of Burk and others cast substantial doubt on the safety of fluoride. I was very worried at the time, as were many of my right hon. and hon. Friends. I had my doubts on safety grounds. In the 1980s those doubts were laid to rest by subsequent scientific evidence. After careful consideration of the evidence on safety no hon. Member could conceivably feel that there is any genuine scientific doubt on the safety of fluoride.
  That leads me to the third, the last and the most important issue that is being considered tonight, and that is freedom of choice. In that context it is important to understand that in artificially adding fluoride to the water supply we are in no way introducing a substance which is otherwise alien to us. That is the underlying factor which makes any argument against fluoride based on freedom of choice almost impossible to substantiate.
  First, freedom can be seen not to be contravened when we consider that fluoride is widely and naturally present in the human diet. It occurs at particularly high levels in tea. Indeed, as has been said, a heavy tea drinker in a fluoridated area will ingest far more fluoride from his tea than he ever will from the water.
  Secondly, almost every toothpaste that is on the market today contains a substantial amount of fluoride at the proper safety level and some 95 per cent. of all toothpastes that are marketed and used, I dare say. by most hon. Members, contain fluoride.
  Thirdly, fluoride is naturally present in almost every water supply around the globe. In the United States it exists at levels of up to 13·6 mg per litre, in the United Kingdom, in the West Mercia water area, it exists at levels of up to 5·8 mg per litre; in Austria at up to 5·3 mg; in Italy at up to 3 mg, and so on.
  Mr. Lawrence rose—
  Mr. Patten: I am sorry, but my hon. and learned Friend was not able to give way to me and I am af-aid that I do not have the time to give way now in attempting to wind up the debate.
  We must also be wary of assuming that drinking water supplies that are not fluoridated do not have other additives. In his opinion Lord Jauncey said:
  "There are some 18 different chemicals which are added to different supplies in Strathclyde and whose purpose is to achieve purity."
  That helps put the argument on the addition of fluoride into perspective. Governments approve the addition of additives to a range of foodstuffs, whether it be iodine to salt or vitamins to bread. Once one looks at the number of areas in which, with Government and all-party support

  135
  things are added to our diet and drinks, it is difficult on pragmatic logic to separate out fluoride from any of those other additions.
  Mr. Fairbairn: All the other substances named by Lord Jauncey in his judgment are intended to help the person who ingests them. Fluoride is added not to help the person who ingests it but others. My hon. Friend has said that the Government's purpose is to advise on what is good and what is not, not to make it compulsory. Why has he changed his mind on fluoride?
  Mr. Patten: I have explained that.
  In order to try to erect some form of suitable philosophical background for what I have had to say I reread my distinguished constituent Sir Isaiah Berlin's important work "Two Concepts of Liberty". I came to the House tonight with an argument erected on that important book, but unfortunately my hon. Friend the Member for Bristol, West (Mr. Waldegrave) told me that Sir Isaiah has recently remarketed his book and increased the number of concepts of liberty from two to four. That was inconvenient from the point of view of anyone suggesting an argument based on concepts of liberty about what we do and do not consume for which it is impossible—I am trying to answer the comments made soto voce by my hon. Friend the Member for Ynys MÔn—to lay down a hard and fast barrier beyond which one cannot go before personal liberties are themselves transcended.
  I simply cannot find in my mind any line to suit all places, all circumstances, all situations at all times and say, "If I cross that line, personal liberties are transcended. If I do not cross it, everything is all right." In the end one must make a judgment on, the facts and evidence.
  I recognise that there will always be those who genuinely feel that water fluoridation constitutes mass medication and, as such, should not be permitted. Set against that, it is the view of the Government that it is for the responsible bodies which take decisions locally to weigh any alleged interference with the liberty of the individual against the undoubted benefits which we believe future generations will gain in their dental health as a result of water fluoridation.
  As with any decision which is taken on a community basis, there will inevitably be those who are disappointed whichever way the local decision goes. Nevertheless, in this strictly limited Bill we are doing no more than restoring the situation to what we understood it to be in Britain before the judgment delivered by Lord Jauncey in the Scottish courts.
  As has been stressed, this is a short measure designed to give the responsible authorities the legal power to choose, if they wish, to improve dental health by the fluoridation of water supplies. Nothing new— no compulsion—is introduced by the Bill.
  I hope that the House will agree, not least in view of the authoritative evidence we have heard on the safety and efficacy of fluoridation, that this choice should continue to be open to health and water authorities on the basis that has been in operation for the last 30 years.
  Question put, That the Bill be now read a Second time:—
  The House divided: Ayes 159, Noes 71.

  Division No. 62]

  [12.28 am

  AYES

  Alexander, Richard

  Macfarlane, Neil

  Alison, Rt Hon Michael

  MacKay, John (Argyll & Bute)

  Amess, David

  Major, John

  Ancram, Michael

  Marland, Paul

  Arnold, Tom

  Mather, Carol

  Atkinson, David (B'm'th E)

  Maude, Hon Francis

  Baker, Rt Hon K. (Mole Vall'y)

  Mawhinney, Dr Brian

  Baldry, Tony

  Maxton, John

  Banks, Robert (Harrogate)

  Mayhew, Sir Patrick

  Batiste, Spencer

  Meacher, Michael

  Beaumont-Dark, Anthony

  Meadowcroft, Michael

  Bevan, David Gilroy

  Meyer, Sir Anthony

  Biffen, Rt Hon John

  Miller, Hal (B'grove)

  Boscawen, Hon Robert

  Miller, Dr M. S. (E Kilbride)

  Bottomley, Peter

  Moore, John

  Bottomley, Mrs Virginia

  Morrison, Hon P. (Chester)

  Boyson, Dr Rhodes

  Moynihan, Hon C.

  Brittan, Rt Hon Leon

  Neubert, Michael

  Brooke, Hon Peter

  Newton, Tony

  Buchan, Norman

  Nicholls, Patrick

  Buck, Sir Antony

  Onslow, Cranley

  Burt, Alistair

  Osborn, Sir John

  Butcher, John

  Page, Sir John (Harrow W)

  Carlisle, Kenneth (Lincoln)

  Page, Richard (Herts SW)

  Chalker, Mrs Lynda

  Patten, John (Oxford)

  Channon, Rt Hon Paul

  Pavitt, Laurie

  Chapman, Sydney

  Pawsey, James

  Clarke, Rt Hon K. (Rushcliffe)

  Pike, Peter

  Colvin, Michael

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

  Coombs, Simon

  Powley, John

  Cope, John

  Raffan, Keith

  Couchman, James

  Raison, Rt Hon Timothy

  Currie, Mrs Edwina

  Rathbone, Tim

  Dalyell, Tam

  Rees, Rt Hon Peter (Dover)

  Dobson, Frank

  Renton, Tim

  Dorrell, Stephen

  Ridley, Rt Hon Nicholas

  Douglas-Hamilton, Lord J.

  Rifkind, Malcolm

  Dover, Den

  Roberts, Wyn (Conwy)

  Dunn, Robert

  Robertson, George

  Durant, Tony

  Robinson, Mark (N'port W)

  Edwards, Rt Hon N. (P'broke)

  Rumbold, Mrs Angela

  Eggar, Tim

  Ryder, Richard

  Eyre, Sir Reginald

  Sainsbury, Hon Timothy

  Fatchett, Derek

  Shaw, Giles (Pudsey)

  Fenner, Mrs Peggy

  Shepherd, Colin (Hereford)

  Fletcher, Alexander

  Shersby, Michael

  Foulkes, George

  Sims, Roger

  Fowler, Rt Hon Norman

  Smith, Tim (Beaconsfield)

  Fraser, Peter (Angus East)

  Soames, Hon Nicholas

  Freud, Clement

  Speed, Keith

  George, Bruce

  Spencer, Derek

  Godman, Dr Norman

  Squire, Robin

  Goodlad, Alastair

  Stanley, John

  Gow, Ian

  Stevens, Lewis (Nuneaton)

  Gower, Sir Raymond

  Stewart, Allan (Eastwood)

  Gregory, Conal

  Stewart, Ian (N Hertf'dshire)

  Gummer, John Selwyn

  Stradling Thomas, J.

  Hayhoe, Barney

  Taylor, John (Solihull)

  Hogg, N. (C'nauld & Kilsyth)

  Thatcher, Rt Hon Mrs M.

  Home Robertson, John

  Thompson, Donald (Calder V)

  Howard, Michael

  Thompson, Patrick (N'ich N)

  Howe, Rt Hon Sir Geoffrey

  Thorne, Neil (Ilford S)

  Hunt, David (Wirral)

  Thurnham, Peter

  Jenkin, Rt Hon Patrick

  Tracey, Richard

  Johnson Smith, Sir Geoffrey

  Trippier, David

  Joseph, Rt Hon Sir Keith

  Viggers, Peter

  Key, Robert

  Waddington, David

  Knight, Mrs Jill (Edgbaston)

  Waldegrave, Hon William

  Lamont, Norman

  Walden, George

  Lang, Ian

  Wallace, James

  Lawson, Rt Hon Nigel

  Wardle, C. (Bexhill)

  Lee, John (Pendle)

  Watson, John

  Lennox-Boyd, Hon Mark

  Watts, John

  Lilley, Peter

  Wheeler, John

  Lofthouse, Geoffrey

  Whitney, Raymond

  Lyell, Nicholas

  Wiggin, Jerry

  McCrindle, Robert

  Wilson, Gordon

  McDonald, Dr Oonagh

  Wolfson, Mark

  137

  Wood, Timotny

  Tellers for the Ayes:

  Young, Sir George (Acton)

  Mr. Peter Lloyd and

  Younger, Rt Hon George

  Mr. Tristan Garel-Jones.

  NOES

  Alton, David

  McKay, Allen (Penistone)

  Ashdown, Paddy

  McKelvey, William

  Beith, A. J.

  Maclean, David John

  Benyon, William

  Maxwell-Hyslop, Robin

  Bermingham. Gerald

  Maynard, Miss Joan

  Best, Keith

  Merchant, Piers

  Biggs-Davison, Sir John

  Molyneaux, Rt Hon James

  Body, Richard

  Monro, Sir Hector

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

  Nellist, David

  Brown, M. (Brigg & Cl'thpes)

  Norris, Steven

  Budgen, Nick

  Ottaway, Richard

  Butterfill, John

  Parris, Matthew

  Carlile, Alexander (Montg'y)

  Percival, Rt Hon Sir Ian

  Carttiss, Michael

  Portillo, Michael

  Cash, William

  Powell, Raymond (Ogmore)

  Chope, Christopher

  Proctor, K. Harvey

  Clegg, Sir Walter

  Rhys Williams, Sir Brandon

  Craigen, J. M.

  Shaw, Sir Michael (Scarb')

  Fairbairn, Nicholas

  Skeet, T. H. H.

  Fallon, Michael

  Skinner, Dennis

  Gardiner, George (Reigate)

  Stanbrook, Ivor

  Golding, John

  Stern, Michael

  Griffiths, Peter (Portsm'th N)

  Stevens, Martin (Fulham)

  Grist, Ian

  Stewart, Andrew (Sherwood)

  Ground, Patrick

  Stewart, Rt Hon D. (W Isles)

  Hancock, Mr. Michael

  Sumberg, David

  Hawkins, C. (High Peak)

  Walker, Bill (T'side N)

  Haynes, Frank

  Waller, Gary

  Higgins, Rt Hon Terence L.

  Warren, Kenneth

  Howarth, Gerald (Cannock)

  Wells, Sir John (Maidstone)

  Howells, Geraint

  Wigley, Dafydd

  Hunter, Andrew

  Williams, Rt Hon A.

  Lawrence, Ivan

  Woodall, Alec

  Leigh, Edward (Gainsbor'gh)

  Lester, Jim

  Tellers for the Noes:

  Lightbown, David

  Mr. Peter Bruinvels and

  McCartney, Hugh

  Mr. Neil Hamilton.

  McGuire, Michael

  Question accordingly agreed to.
  Bill committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).

  National Heritage (Scotland) Bill
  As amended (in the Standing Committee), considered.
  National Heritage (Scotland) Bill
    New Clause 1

      SCOTTISH MUSEUM OF INDUSTRY
      'There shall be a Board to be known as the Board of Trustees of the Scottish Museum of Industry which shall be appointed by the Secretary of State to establish a Museum of Indusiry.'.— [Mr. Craigen.]
      Brought up, and read the First time.
      12.39 am
      Mr. Jim Craigen: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Mr. Ernest Armstrong): With this it will be convenient to take amendment No. 16, in line 5, after 'Edinburgh', insert
      'to establish a Board of Trustees of the Scottish Museum of Industry.'.
      Mr. Craigen: It is unfortunate that the House must deal with the report stage at such an early hour of the morning, especially as we have had a hard day with the Trustee Savings Banks Bill and the Water (Fluoridation) Bill. However, we are still here.
      New clause 1 relates to the establishment of a Scottish museum of industry. As the Minister knows, we did not have an opportunity in Committee properly to air this issue, although the concept of such a museum was frequently raised. We found it necessary to table the new clause because of the Government's disingenuous approach. There had been every sign that the Government fully supported the concept of establishing a museum of industry, even to the extent of the Secretary of State being on record as saying that it was in an exciting prospect. Therefore, I expected the Minister to be more positive when he replied to the Second Reading debate. Unfortunately, we were not shown how, when or where the Government planned such a museum.
      The Williams report, "A Heritage for Scotland", was never debated in the House, although there was a debate in another place on 27 January 1982. Otherwise, we have had to rely on a series of written parliamentary answers from the Secretary of State. The hon. Member for Edinburgh, West (Lord James Douglas-Hamilton) has been particularly diligent in pursuing these matters. The written answer he received on 22 July 1982 made no specific mention of the proposal for a museum of industry, but by 8 December 1983 the Secretary of State said that he was seeking advice on the matter.
      The concept of a museum of industry for Scotland is an exciting prospect. As that was the Secretary of State's view, I was surprised on Second Reading when in reply the Under-Secretary gave the impression that the Government had changed and, indeed, positively deserted their position on the matter
      In Committee we spoke about the possibility of a freestanding museum, as envisaged by the Williams committee in its report. Dr. Alwyn Williams wrote to me on 26 November 1984:
      "I hope that there will be no let up in the pressure for a Museum of Industry in the West of Scotland. The image of the City of Glasgow and the Clydeside conurbation in general has been transformed even since my return in 1976. The momentum which is now compelling the rest of the world to recognise the city as a cultural centre of international standing must not be lost."

      139
      Given that we are dealing with the National Heritage (Scotland) Bill, the Government should not lose sight of the recommendations of the Williams report.
      12.45 am
      If the museum of industry is to be subsumed into the new structure of the museum of Scotland, some of us fear that it may get short shrift, because the new board of trustees, unless there is a clear Government commitment, may have certain biases towards the totality of existing institutions. Ministers should make clear what they envisage by the concept of a museum of industry since, as I have said earlier, the Secretary of State found it a particularly exciting prospect.
      New clause 1 is a probing clause, because it is essential at this stage for the Government to give some answers that were not given in Committee. My hon. Friend the Member for Linlithgow (Mr. Dalyell) in particular tried to put a price tag on the capital cost of a museum of industry, and I think his figure was about £20 million. The Minister did not contradict him in Committee but, although I requested it, the Minister was not able to produce his own calculation.
      We are dealing with a matter of principle and I want a simple yes or no from the Minister. Do the Government still believe in a museum of industry for Scotland? If the Minister says no, is he going to bury the idea in the same way as he has been burying so much of the living industry of Scotland? If he still feels that there should be a museum of industry, what vibrations is he getting from the committee under Lord Bute, and what instructions will he give the new board of trustees when it is set up?
      The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart): I am grateful to the Hon. Member for Glasgow, Maryhill (Mr. Craigen) for giving the House the opportunity to consider this topic tonight. As he rightly said, the new clause would have the effect of setting up a free—standing board of trustees to establish a Scottish museum of industry. As he has again rightly said, that is broadly in line with what was recommended by the Williams committee. But as I explained in Committee—I thought I had made the position clear—in principle, that essential proposal runs counter to the present general thinking on the subject in museum circles. Some of that thinking was referred to by other hon. Members. It is thinking which has the endorsement of the bodies which have been consulted during the last year or so, including the Scottish Museums Council and its industrial museums advisory board.
      A consensus is now emerging that the concept of a museum of industry cannot and should not be separated from that of a museum of Scotland. The story of the growth of industry in Scotland is an integral part of the general story of Scotland's history. Therefore, it is now thought to be much more appropriate to set it in its proper place in developing the museum of Scotland concept. Exactly how that is to be developed is still under discussion, but I can tell the hon. Member for Maryhill that one suggested approach is that certain core disciplines could be built up within the national museums, largely on the basis of material that they already hold, which might then point interested visitors in the direction of more specialised displays and collections in a number of venues throughout Scotland. In Committee, the hon. Member for
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      Linlithgow (Mr. Dalyell) rightly referred to several other venues in Aberdeen and Bathgate that are important in this context.
      Certain developments of that type are already in being or planned. It might be one of the tasks for the new board of trustees of the national museums and of its staff to encourage the development of such specialised displays in several key centres.
      The hon. Member for Maryhill asked me what the up-to-date position is. It is one of the issues to which the advisory board is giving a great deal of thought. It has already had the benefit of two major papers from Dr. Neil Cossons, the director of the national maritime museum in London and former director of the Ironbridge museum trust. The advisory board will be recommending the direction in which the national museums policy might be channelled in that area.
      Mr. Norman Buchan: The Minister has mentioned an ominous name. Dr. Cossons is the first man to have followed the lead of the Government in instituting charges at Greenwich. The hon. Gentleman is not going to rely too much on his advice, is he?
      Mr. Stewart: I recall that in Committee the hon. Member for Linlithgow— I am sure that he will intervene if I am misquoting him—paid a considerable tribute to Dr. Cossons' expertise in that area. He is widely respected.
      I have no doubt that the board will take careful note of the keen interest that has been expressed by hon. Members in the direction of such developments.
      The hon. Member for Maryhill asked me about resources. He will know that before the board reports we cannot say precisely what resources the new structure will require. However, I hope that hon. Members will be reassured, because resources came up in Committee, by the decisions made by my right hon. Friend the Secretary of State and announced to the House about the provision for the museums in 1985–86. My right hon. Friend announced an increase in the net provision for the two museums of 12 per cent.—an extra £700,000—through the Property Services Agency for the fabric of the museums, and an increase in the grant for the Scottish Museums Council of 41 per cent. At a time when public expenditure is rightly under restraint, those figures are a clear sign of the Government's commitment to our national museums. I hope that my explanation of the present position has been helpful to the House.
      Mr. Craigen: It seems that in a most tortuous way the Minister has shown that he has gone cold on the whole issue of a museum of industry. I confirm that my hon. Friend the Member for Linlithgow (Mr. Dalyell) and I were at one over the prospect of a core museum with strong links with localities, industries and communities. A network depicting the industrial heritage of Scotland could have been developed.
      I am worried about the Minister's reply. He told us that the decision would be left to Lord Bute and the unified board of trustees. Thus, he is effectively squeezing out the options that now they will not seek.
      Mr. Tam Dalyell: I thank the Minister for the three-page letter that he sent to my hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) and myself, because it was very helpful.

      141
      So much depends on the resources that will be available to the local museums. I do not want to reiterate too much of what was said in Committee, but is it right or wrong to suggest that if there is to he a museum of industry as such, £20 million is a minimum figure? Given the public expenditure of any Government, surely that will have reverberating ramifications on the local museums, about which we rightly said so much. Since our discussions, my impression is more and more that museums, such as Aberdeen, with fishing specialities, are worried about their own resources. Perhaps the Minister will comment on that.
      Mr. John Home Robertson: In the absence of the new clause, where will this leave the fledgling Scottish mining museum recently opened at Prestongrange in my constituency and at the former Lady Victoria colliery at Newtongrange in Midlothian? Without some funding from the new authority what will happen to that museum, the Scottish fisheries museum and many others?
      Mr. Allan Stewart: I should perhaps repeat the quotation rightly given in Committee by the hon. Member for Paisley, South (Mr. Buchan) in which the Scottish Museums Council states:
      "We consider that a single-site, monolithic Museum of Industry in Scotland is neither a practicable, nor a desirable option."
      I think that that view of the relationship between a museum of industry and the rest of the museum world is broadly accepted.
      Perhaps I did not make it sufficiently clear to the hon. Member for Linlithgow in Committee that the idea that sums of the order of £20 million are readily available is clearly unrealistic. I hope that he will accept that the sums announced, ahead of the decisions by Lord Bute's committee, in respect of net grants to the national museums and the Scottish Museums Council for 1985–86 show the Government's interest in and concern for museums.
      For the same reason, I cannot give a precise answer to the hon. Member for East Lothian (Mr. Home Robertson) in relation to the mining museum. I hope that the House will accept that until the advisory board has reached its conclusions and submitted its advice we cannot make decisions on a number of points of detail which are of interest to hon. Members.
      Question put and negatived.

    New Clause 2

      ORDERS FOR ADMISSION CHARGES
      'Where the Boards of Trustees of the National Museum of Scotland, the Royal Botanic Garden, Edinburgh and the National Galleries of Scotland intend to institute payment for admission they will require an Order made by Statutory Instrument and subject to affirmative resolution by both Houses of Parliament.'.—[Mr. Buchan.]
      Brought up, and read the First time.
      Mr. Buchan: I beg to move, That the clause be read a Second time.
      Our discussion in Committee on this was merely exploratory. It may be useful to deploy the arguments at greater length and we make no apology for returning to the matter today. In Committee the Government argued, first, that there was nothing in the Bill to enforce changes and, secondly, that the power to make charges already existed
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      if the museums chose to use it. That was buttressed by the argument that, democratically. it should be up to the trustees of the museums to impose charges if they so wished—giving them the kind of freedom that Scottish local authorities are supposed to have on matters other than fluoridation.
      We challenge that argument because we do not believe that the trustees should make that decision. On the contrary, we regard it as a matter of supreme national policy for museums and galleries. We are reinforced in that view for two reasons. First, there is the financial squeeze on authorities in Scotland. I appreciate that it is less cataclysmic and less devastatingly mean than that imposed on English authorities this year. although no doubt it will be our turn next year. Nevertheless, we fear that the general squeeze will create conditions in which museums will be tempted to introduce charges to try to help their finances.
      1 am
      We are concerned, because the squeeze is occurring under this Prime Minister. It is largely forgotten that she was the first person to seek to introduce charges when she was Secretary of State for Education and Science in 1971. It is worth reminding ourselves of the attitude that she adopted then. She is fairly influential within the Cabinet, if we are to believe reports. When she was Secretary of State she introduced the enabling power to make charges and to put the power to charge beyond dispute. She quoted the White Paper and said that it was "Legislation to enable the Trustees of the"
      various national museums to charge—
      "The enabling nature of the legislation has been made clear throughout."
      One or two of us pressed the right hon. Lady on that. I said, "Explain that." My hon. Friend the Member for Warley, East (Mr. Faulds) said:
      "Will the right hon. Lady make it clear"?
      She said:
      "That is quite clear. The Government require charges to be made."
      Therefore, within two paragraphs enabling powers meant that the Government required charges to be made. I hope that I have made that quite clear. A little rattiness was creeping in. The right hon. Lady said:
      "I understood that the trustees wanted an unequivocal statement. I believe that I have now given them what they want."—[Official Report, 21 June 1974; Vol 819, c. 1012–3.]
      She gave them an instruction on charges.
      Since the National museum and the galleries were wholly dependent for their expenditure on Government finance through the taxpayer, once the powers were complete the decision that charges should be made was the Government's. That is the Prime Minister's attitude. Therefore, we have reason to be anxious.
      We are also anxious because we do not believe that the concept involved in admission charges for museums is good for the health of a civilised community. I know the jeux d'esprit of the Minister for the Arts. We went through this in committee when he said that there was more satisfaction and pleasure to be derived from payment for services rendered. As I pointed out then, it is the philosophy of the prostitute— one that should not be advocated for our young people.
      In 1971 Paul Jennings wrote a little poem, when he said that the Government were attempting to equate cash with art. It was called
      "Lines Written in Despondency in Trafalgar Square"—

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      the site of the National Gallery—and said:
      "Oh God, a dreadful army comes,
      Of foppish hardhats, po-faced bowlered bums
      Whose mealy minds, whose souls of dust and ash
      Chafe for the chance of turning art to cash."
      That is the philosophy of the Government, and that is why we are opposed to it.
      This matter has been discussed at great length in museums. I have with me reports of discussions at an international conference about charges in 1969. One speaker said:
      "if one admits the state's obligation— through national, provincial or municipal channels—to educate the population, there seems no good reason for justifying the erection of an economic barrier precisely at the level where the masses are directly involved."
      It is interesting that that was said by the director of the La Plata museum—Mario Teruggi—in Buenos Aires. The Argentine was well in advance of the rulers of this country.
      There is another interesting historical fact. We were told in Committee that the proposal would have little or no effect on admissions. Some of us challenged that and said that it would certainly alter the nature of those admitted—the little snotty-nosed youngster from Partick would not find it easy to dive into a gallery. Even my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) was once— unbelievable as it is— a snotty-nosed youngster. Such youngsters will no longer get the chance to dash in to press buttons on machines, and trigger off an interest. The nature of the admissions will change. The casual visitor who will get excited about a particular subject will be stifled. Only the intentional visit will take place.
      We have interesting evidence about other effects of charging. I have an article from the Museums Bulletin back in 1973 when good old Edinburgh council had five museums in its care, and abolished charges at the end of 1972 in four of the museums.
      Mr. George Foulkes: I was on the council at the time.
      Mr. Buchan: Good. The four museums were Lady Stair's house, Huntly house museum, Canongate tolbooth and Lauriston castle.
      Mr. Foulkes: And the Museum of Childhood.
      Mr. Buchan: No, there was an intractable problem that year with the Museum of Childhood, which was privately owned, but later the charges were abolished, as my hon. Friend says.
      In those four museums, the following things happened. In February 1972, Lady Stair's house had 263 admissions. After the abolition of charges, it had 898 admissions in February 1973. In May 1972 Lady Stair's had 972 visitors, and in May 1973, 2,800— three times as many. A similar thing happened with the Huntly house museum. In May 1972, it had 1,200 visitors, and in May 1973 4,600— nearly four times as many visitors. Canongate tolbooth had 758 visitors in May 1972, and 3,300 in May 1973— again, nearly four times as many. Lauriston castle had 340 visitors in May 1972, and 1,309 in May 1973—again nearly four times as many.
      Therefore, admission charges change the nature of admissions and the number of visitors.
      Mr. Foulkes: I do not think that my hon. Friend has made the political point that between 1972 and 1973 there
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      was a major political change in the council and the Conservative, or, as it was called at the time, quite wrongly, the Progressive, majority, was replaced by a majority of Labour and, I must admit, Liberal members, and that is why the change took place.
      Mr. Buchan: I thought that that was almost understood. It was from the Labour party— and in this case the Liberal party as well— that civilisation had to come.
      We reject this move on practical, economic and, above all, on philosophical grounds. It would be shameful for Britain, which has led the way in this in the past, to go back not to Victorian ideas, because it was the Victorian philanthropists who left us so much, but to the pre-Victorian. primitive ideas. We are concerned because the Prime Minister has more regard for cash than for the arts, and therefore we have proposed the solution that if the charges are to be permitted, that can only be done on the say-so of the House. If the Government wish to remove all power from local authorities in this matter, let there at least be some parliamentary control. The power should be made only after the passing of an order by the House.
      Mr. Allan Stewart: As always, I have listened with great respect to the hon. Member for Paisley, South (Mr. Buchan). I fear that I cannot emulate his example in literary quotations, but I hope that I shall be able to reassure him about the Government's intentions. As he said, this debate follows a lengthy debate in Committee on a group of amendments tabled by Labour Members. Those amendments were designed to restrict the powers of the various boards to levy admission charges for entry to their collections. As I explained, and as the hon. Gentleman repeated tonight, those amendments failed to recognise that the reference to admission charges in the Bill in respect of the national museums and galleries was included merely for the avoidance of doubt. The powers for the boards to charge admission are contained in the Museum and Galleries Admission Charges Act 1972.
      The hon. Gentleman suggested that Parliament should have the right to approve any proposal that admission charges be introduced at any of our national institutions, although, as he will know, recently charges for special exhibitions have been instituted without great controversy. It was to decide on such matters, which are principally for the institutions concerned, that we are establishing independent boards of trustees with wide-ranging expertise and flexibility. The 1972 Act, which gives those powers to the independent boards for the national museums, remained on the statute book, unamended, throughout the term of office of the Labour Government, so that the approach in the Act was clearly not then believed to be contrary to the policy that the hon. Gentleman's colleagues were following.
      The hon. Gentleman's major point in raising this subject is to query the Government's view. I confirm that the Government's view has not changed. It is this: in respect of the museums and galleries, the boards of trustees should be free to decide for themselves whether charges should be introduced for entry to special exhibitions or to the permanent collections. I assure him that there is no intention to force institutions to introduce general admission charges. Secondly, as far as I am aware, no proposal for general admission charges is under

      145
      consideration at any of the Scottish national institutions. I hope that the hon. Gentleman will be reassured by those two points.
      Mr. James Wallace: In the spirit of Lib-Lab agreement, which undoubtedly influenced decisions in Edinburgh city council in 1972 or 1973, I lend my support to the new clause. The Minister maintained that the boards would be free to decide for themselves and that there would be no Government direction. Of course, it is well recognised that there need not be a direct order sent from the Scottish Office to the boards to impose charges. That can be done much more subtly. If the funding to those bodies is not adequate, they will be forced indirectly to impose charges. Any imposition of charges for the general exhibitions in museums, and even in the royal botanic gardens, which are much used by the citizens of Edinburgh and by visitors to the city, would be a retrograde step.
      We live at a time when it is predicted that there will be ever-increasing leisure time for people to enjoy. One aspect of that leisure time that many will wish to develop is a greater interest in our heritage and culture, and at this stage we should not put harriers, especially pecuniary ones, in their way. Although such cultural excursions are no substitute for proper jobs, it must be said that, at a time of high unemployment, many people who are on the dole take the opportunity to visit our museums. I believe that, for some time, London zoo has had great difficulty in financing itself, because it has not been able to attract the public and because it has admission charges. We are talking not about one person visiting the zoo, but about someone taking his wife and children. It becomes a special burden, on top of travelling expenses, to undertake such a cultural expedition. Therefore, it is only right that Parliament should have the chance to debate any decision to impose charges.
      1.15 am
      Mr. Gordon Wilson: One of the advantages of having served on the Committee on a Bill is that one can be brief on Report.
      However, it is worth reiterating that one reason why this matter was raised in Committee was that there was suspicion of what the Government may be up to. The Government may have no direct policy of coercion of trustees— whom they appoint— but it is apparent that after this year, when they have, admittedly, been generous to the Scottish museums, they can ensure that charges are made, simply by cutting the amount of money available—it is the rack principle which the Government operate on local government; a few turns of the screw will presumably do the trick when trustees are worried about how to make ends meet.
      The SNP believes that it would be a retrogressive act if payments had to be made at the door of public collections. That would reduce the number of people who could visit those collections, and the figures quoted by the hon. Member for Paisley, South (Mr. Buchan) show what could happen if charges were introduced.
      If the Government had a reputation for being liberal towards the arts, there would be no need for the debate. It stands to the eternal shame of the previous Labour Government that they did not alter the 1972 Act so that there could be no doubt. The present Government would have had to legislate to reintroduce charges and would thus have given the game away.
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      I hope that the Government do not intend to compel trustees to impose charges. If they are sincere in what they say, there is no reason why they should not accept the new clause, which would at least allow us to have another bite if the Government change their mind or compel the trustees to change their minds.
      Mr. Craigen: I wish to be clear about the Government's stance. In Committee, the Minister said that charges were nothing to do with the Government. He said:
      "we would expect the trustees to discuss any proposals for charges with Ministers before the charges were introduced."—[Official Report, First Scottish Standing Committee, 11 December 1984; c. 57.]
      All that we are saying is that we do not trust the Government in the present economic climate. We do not want Ministers to say to trustees on the quiet, "We want you to introduce charges to increase your own resources." Before Ministers agree to the imposition of charges or bring trustees round to the realisation that they may have to introduce general admission charges, the matter should be discussed by Parliament.
      Sir Hector Monro: The Opposition are making desperately heavy weather of the new clause. As one of the Ministers in charge of the 1972 Act, I know that all the legal issues were cleared in relation to the trusts, and in particular to the Vaughan Bequest. I hope that all Opposition Members will go to see that this month, free, in Edinburgh and that they will see the Turner watercolours.
      We are talking about relatively few national galleries and museums compared with the enormous number of other museums in Scotland, some of which charge in accordance with their local authority's decision Thus, I cannot see why the Opposition make such an issue about the national institutions. I was charged to go to see the exhibition on Ramsay MacDonald in Lossiemouth museum. I had to pay to see it, and it was an excellent exhibition. Indeed, it was much enhanced by a large section on the fishing industry.
      There is nothing wrong in charging to see some of the exquisite works of art that our national exhibitions have. For an individually very small charge, an enormous sum could be provided collectively with which to enhance the standing of our facilities and exhibitions. It would be a great help to purchase and retain in Scotland some of the things that we would like to see on exhibition.
      Mr. Nicholas Fairbairn: The national galleries of Scotland in Edinburgh have 400,000 visitors a year, which is less than a third of the number who have visited the Burrell collection. Those visiting are not unemployed and do not come from Craigmillar but are, I regret to say, members of rather a restricted social class. They do not pay charges that they could afford, but the many people whom we should like see visiting them do not do so despite the absence of charging. Thus, I do not see why charging is said to be a deterrent.
      Sir Hector Monro: I quite agree with my hon. and learned Friend. I hope that my last point will reinforce the view held by my hon. Friend the Minister. We look on Edinburgh as one of the great tourist attractions of Scotland. Hopefully, we can take a lot of money from the tourists who wish to see the exhibitions available. That money from overseas could go towards improving the facilities and adding to the collections.

      147
      All in all, the Opposition have made a very feeble case, and I hope that my hon. Friend the Minister will stick to his guns.
      Mr. Buchan: I shall be brief, but I should like to deal with a few canards. We have been asked why we are making such a meal of this issue, but the answer is that we are dealing with national museums. That is why the House must pay attention to it. Indeed, above all, this measure could be a trend-setter for other museums and galleries.
      As it happens the local authorities have a pretty good record, including Glasgow's courageous decision— despite being financially squeezed by the Government— to open the Burrell gallery and to make it free.
      Mr. Fairbairn: A collection is made.
      Mr. Buchan: Money is indeed collected, and people generously pay without being asked, because they say that the exhibition is good and that they want to contribute to it. There is a world of difference between people who have entered and seen the exhibition freely, and who wish to contribute to it and—
      Mr. Foulkes: Sock it too them, Norman.
      Mr. Buchan: I shall try not to do that, because the time is late. The mentality and philosophy of Government Members cause me rue.
      A terrible intervention was made by the hon. and learned Member for Perth and Kinross (Mr. Fairbairn). He said that 400,000 people a year visited the national gallery and that 1,200,000 visited the Burrell collection. That is three times as many. The hon. and learned Gentleman said that the national gallery attracted a restricted social class. I like the language of Government Members. The truth is that the Burrell collection has succeeded from the beginning because it is seen as being popular in the best sense. It belongs to and emanates from the people of Glasgow and they have responded. If the hon. and learned Gentleman went there he would see that. Yes, the unemployed go there. Yes, families go there. People from a wide social class go there. If the hon. and learned Gentleman does not know that, he has no right to participate in the debate.
      The hon. and learned Gentleman is right that that does not apply to the national gallery. That is because it has not succeeded in making contact with the people of Edinburgh. The new director clearly wishes to move in that direction. Because of its nature, the national gallery has never been deployed in the same way. It has been regarded as a repository rather than a collection. That is the reason.
      All the nonsense about social class is merely an argument for making those who can afford it pay. Some argue that tourists should also be made to pay. Tourists come to Britain for two important reasons. Without tourism, Britain would be bankrupt. Only oil and tourism keep Britain afloat.
      Americans are attracted to Britain because we speak English and because up to now our great national institutions and galleries have been free. That is where the income comes from.
      Mr. Fairbairn: The hon. Member suggests that I have not seen the Burrell collection. That was intentionally offensive. None has been more anxious than I to see the
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      Burrell collection properly housed. It was properly housed under this Government. The Burrell collection is popular for many reasons—one of which is that people can go there by bus. That is not possible if one wants to visit the national galleries and museums in Edinburgh. That is one of the problems.
      Alas, only a restricted type of person cares to go to the galleries in Edinburgh. That has nothing to do with charges.
      Mr. Buchan: Most of the hon. and learned Gentleman's points are rubbish. Buses pass the national gallery every day. It is only 200 yards from Waverley station. What is the man talking about? It is rubbish.
      1.30 am
      Mr. Allan Stewart: The debate has touched on several points and a variety of views have been expressed. I hope that we can all agree that the Burrell has been an outstanding success. In my view, it has been an outstanding success not only for the people of Glasgow and the surrounding area but in terms of its effectiveness as a tourist attraction.
      As my hon. and learned Friend the Member for Perth and Kinross (Mr. Fairbairn) rightly pointed out to the House, it has been opened under this Government and 50 per cet. of the capital cost was supplied by the Scottish Office. I hope that hon. Members will recognise that. The decision may have been made by the right hon. Member for Glasgow, Govan (Mr. Millan), but the money to ensure that the museum was built was found by this Government.
      I want to concentrate on the new clause. I think that the hon. Member for Paisley, South (Mr. Buchan) will accept that the new clause would mean that on each occasion that an institution wished to impose charges—for example, for a special exhibition— it would need an affirmative resolution of the House. I am sure that the hon. Gentleman would not wish such a restriction to be imposed, because it is widely accepted that when institutions incur extra costs to lay on special exhibitions it is reasonable that charges should be imposed to raise the necessary finance.
      I end by reiterating the Government's position, and I hope that the hon. Gentleman will accept it. There is no intention to compel institutions to introduce general admission charges— I think that that is the essence of his concern—and, as I said earlier, so far as I am aware no proposal for general admission charges is under consideration at any of the Scottish national institutions.
      The hon. Member for Glasgow, Maryhill (Mr. Craigen) asked me about the Government's role in all this. I simply reiterate what I said in Committee: that, while decisions are for the trustees. I would expect them to discuss any such proposals with the Department before implementing them.
      Question put and negatived.

    Clause 2

      THE BOARD'S GENERAL FUNCTIONS
      Mr. Allan Stewart: I beg to move amendment No. 1, in page 2, line 13, after 'agricultural', insert `archaeological, artistic'.
      Mr. Deputy Speaker: With this it will be convenient to take Government amendment No. 8.
      Mr. Allan Stewart: The two amendments implement undertakings that I gave in Committee. My hon. Friend the Member for Fife, North-East (Mr. Henderson) suggested that knowledge or experience of archaeological matters was a quality that my right hon. Friend the Secretary of State should look for in appointing members of the new board, and I agreed to consider that suggestion. We were particularly impressed by his argument that the national museum of antiquities of Scotland is of "particular significance archaeologically''. We have therefore agreed that it would be appropriate to include a specific reference in the schedule as a matter to which my right hon. Friend should have regard.
      Dr. Norman A. Godman: Should not the word "architectural" be inserted after "archaeological"? I was not a member of the Committee, but it may be that the Minister has implicitly subsumed matters architectural under the term "environmental". If not, surely architecture is as important a human activity as the others that are mentioned?
      Mr. Stewart: If there had been an amendment to that effect, I would have considered it in detail, but in fact architecture is subsumed in the other terms in the clause.
      We have gone further than my hon. Friend suggested and concluded that it would be appropriate for a reference to archaeology to be included in clause 2 as one of the matters about which the new board of trustees of the national museums of Scotland must promote public awareness.
      In Committee, I listened to what Opposition Members said about the word "artistic" and, as the hon. Member for Paisley, South (Mr. Buchan) will recall. he agreed to withdraw an amendment that he had moved for the inclusion of "artistic" on my assurance that the Government would introduce an amendment. At that stage I said that the only thing wrong with his amendment was that it was inadvertently proposed for the wrong place in the Bill alphabetically.
      Amendment agreed to.
      Mr. Allan Stewart: I beg to move amendment No. 2, in page 2, line 16, after 'means', insert
      ', including collaboration with other institutions'.
      I suggest that it would be convenient for the House to discuss at the same time amendment No. 3, in page 2, line 18, at end insert—
      '(f) form and maintain recognisable links with and provide advice and assistance to local museums and similar institutions throughout Scotland.'.
      In Committee we had a lengthy discussion about the powers of the new board to collaborate with local museums and other similar institutions. I explained that the powers already in the clause were sufficient to permit this. However, having listened carefully to what hon. Members said, I am aware of the strength of feeling that the pastoral role which the national museums have traditionally played in relation to the other museums in Scotland should continue and develop. Accordingly, amendment No. 2 will make it clear that in promoting the public's awareness of the matters specified in subsection 1(d), the board may collaborate with other institutions.
      The Government amendment goes further than simply local museums, and that is the key difference between our amendment and amendment No. 3, which stands in the names of Opposition Members. The Government amendment makes it clear that the board may come to
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      arrangements with bodies such as the National Trust for Scotland. This is a more satisfactory approach than that embodied in the Opposition amendment, which would be more restrictive in that respect. I confirm that the Scottish Museums Council, the position of which was referred to by Opposition Members in Committee, is happy with the proposed Government amendment.
      Mr. Buchan: We do not propose to press amendment No. 3. My hon. Friends and I welcome this major concession, which goes to the heart of much of the earlier debate on the Bill. The issue was at the heart of many of the representations made by the museum authorities, and I am glad that the Government have listened to season. It shows that there is hope even for the wicked.
      We should have preferred our amendment, which would have set out the matter more clearly; it would also have been alphabetically correct in adding a new subsection (1) (f). The word "collaboration" in the Government amendment might be considered to have slightly sinister implications, but I accept its use in the spirit in which it is intended.
      I appreciate that the Government did not want to make too much of a surrender, and we do not object to that. The important point is that the amendment is being made. The Scottish Museums Council is satisfied. So am I. I said that the amendment would have to be made, and I am thankful for what is a reasonably large mercy.
      Mr. Barry Henderson: I thank the Minister for fulfilling completely the undertakings he gave in Committee with regard to the previous amendment.
      The subject of this matter caused a number of amendments to be tabled in Committee by hon. Members on both sides, all of which were longer than that which the Minister has introduced tonight. I congratulate him on this amendment, which is short and succinct and covers the burden of the points we made in Committee.
      Amendment agreed to.

    Clause 3

      GENERAL POWERS OF BOARD
      Mr. Allan Stewart: I beg to move amendment No. 5, in page 3, line 19, at end insert—
      '(5) Fellows of the Society of Antiquaries of Scotland shall be entitled to free access to the library of the National Museums at such times as the Board may reasonably determine.'.
      This is another point that was raised in Committee by my hon. Friend the Member for Fife, North-East (Mr. Henderson), who expressed concern about the need to recognise the special contribution that the Society of Antiquaries had made to the growth of the National Museum of Antiquities.
      I agree that this historic relationship, to which hon. Members referred in Committee, should continue to be recognised by conferring on fellows of the society the right to make use of the library which it formed and which is at present housed in the Queen street building. That is one of the specifics that the society and its supporters have sought. My hon. Friend will recall that I advised him in Committee that his amendment was slightly defective. However, the Government's amendment meets his point and I hope that it will have the support of the House.
      Mr. Craigen: I acknowledge that we are indebted to the hon. Member for Fife, North-East (Mr. Henderson).

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      Since Committee, I have received a number of letters from members of the Society of Antiquaries of Scotland, and several of my hon. Friends, including my hon. Friends the Members for Carrick, Cumnock and Doon Valley (Mr. Foulkes), for Clackmannan (Mr. O'Neill) and for Glasgow, Garscadden (Mr. Dewar) have sent me letters that they have received, as if I did not have enough of my own. It is apparent that there was a lack of consultation with the society before the preparation of the Bill.
      I received a letter from Mr. P. R. Ritchie, a fellow and past vice-president of the society. I replied to the effect that I would have thought that the Scottish Education Department would have adequately consulted the society before the Bill was published. Only this morning I received a reply from Mr. Ritchie, in which he states:
      "The first intimation from the Scottish Education Department was contained in a letter only a week or so before the Bill was announced. The letter was confined to a notification that the Society would lose its representation on the new Board of Trustees of the National Museums of Scotland. Other provisions of the Bill were not known to the Society's officers until its publication on 9th November."
      The letter concludes:
      "The way in which the present situation has come about gives me no grounds for optimism concerning future facilities."
      The Minister might at least acknowledge that there has been a singular lack of consultation with the society before the preparation of the Bill, which has undoubtedly generated many concerns.
      Mr. Allan Stewart: The society was among the bodies which were consulted in 1982 on the paper which the Department circulated on whether there should be one trustee board or two to administer the national museums. The society's views were taken into account with others that we received before the Government reached their decisions on the issue.
      Subsequently, the society was informed in the autumn of 1984 of the proposed contents of the Bill as they related to the constitution of the new trustee board for the national museums, the special point of interest to the society. Following correspondence with my officials, I wrote to the society's secretary to give a detailed explanation of our reasons for wanting a board constituted on the lines which have been drafted. In addition, the board of the National Museum of Antiquities (Scotland), on which the society has a number of representatives, was consulted in advance of the Bill's publication on the general substance of the Bill as it relates to the national museums.
      It is true that the society is not in agreement with the proposals in one respect which the House will be considering shortly under another group of amendments. However, I assure the House that throughout the consideration which lies behind the Bill, and in preparing the Bill, care was taken to consult the society.
      Amendment agreed to.

    Schedule 1

      THE BOARDS
      Mr. Wallace: I beg to move amendment No. 7, in page 22, line 24, leave out from 'of' to end of line 34 and insert:
      '15 members (referred to in this part of this Schedule as "trustees").
      (2) The trustees shall include the following persons:
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      The President of the Society of Antiquaries of Scotland for the time being ex-officio.

      One fellow of the Society of Antiquaries appointed by the Society.

      One fellow of the Royal Society of Edinburgh appointed by the Society.

      One person appointed by the Convention of Scottish Local Authorities.

      Two persons appointed jointly by the Scottish Universities for their specialist interest in Scottish Archaeology and Scottish History.

      Nine persons appointed by the Secretary of State as follows:

      (i) One representing the Council of British Archaeology in Scotland,

      (ii) Two representing schools in Scotland:

      (iii) Six representing such other public interests as the Secretary of State may think fit.

      (3) The Secretary of State shall appoint a person to be chairman of the Board and the Board shall appoint one of their members to be vice-chairman.'.
      Mr. Deputy Speaker: With this it will be convenient to consider the following amendments:
      No. 9, in page 22, line 32, after 'matters', insert
      'and of the interests of the Society of Antiquaries of Scotland.'.
      No. 10, in page 22, line 35, leave out sub-paragraph (4) and insert—
      '(4) Trustees shall be appointed for a period of four years: after the second year of coming into operation half of the membership of the Board shall be reconstituted at intervals of two years.'.
      Mr. Wallace: In many respects, amendment No. 7 follows on from amendment No. 5. The Under-Secretary of State recognised the great association of the Society of Antiquaries of Scotland with the National Museum of Antiquities. That association is a reason why the amendment has been moved.
      One of the Bill's principal functions is to combine the Royal Scottish Museum and the Museum of Antiquities into one museum controlled by a board of trustees. That combination was recommended by the Williams committee. As the Bill stands, the connection with the Society of Antiquaries would be lost because there would be no statutory provision to include any members of the society on the board of the trustees of the new museum. That is the principal reason why the amendment has been drafted.
      1.45 am
      To a large extent, the amendment reflects the composition of the board as it was constituted under the National Museum of Antiquities of Scotland Act 1954. This measure includes the Royal Scottish Museum which, until now, has been under the control of the Civil Service. The present provision gives the Secretary of State, who already has enormous powers of patronage in many respects in Scotland, power to appoint all trustees. There is no reason why that patronage should be as wide as provided for in the Government's proposals. We seek to limit that patronage by allowing certain members of the Society of Antiquaries to be members of the board of trustees. This provision still allows a certain amount of discretion to the Secretary of State to nominate nine of the 15 trustees.
      The amendment will give a Scottish dimension to the board of trustees. As the Under-Secretary of State has recognised, there has been a long association between the Society of Antiquaries and the National Museum of Antiquities. This measure would parallel in many respects the provision for the National Library. In the 1920s, that

      153
      library was gifted to the nation by the Faculty of Advocates. I declare an interest in this subject as a member of the Faculty of Advocates. The Bill provides for a continuing relationship between the Faculty of Advocates and the National Library. The faculty is well represented on the board of the National Library. The library of the National Museum of Antiquities was donated by the Scottish Society of Antiquaries, and that is why there should be a similiar relationship between that society and the new museum.
      I look forward with interest to discovering the objection of the Under-Secretary of State to curbing the patronage of the Secretary of State. I understand that one reason for the objection is that this action reflects English practice at the Victoria and Albert museum. I do not believe that that is a good reason why we should merely copy English practice.
      I am led to believe that the Department has said that, in view of the wide range of interests inevitably covered by the new board of trustees, difficulties might arise in deciding between the numerous organisations invited to submit nominations to the board. It has been said that, on balance, Ministers should not be advised by Parliament in determining which body should be represented. I cannot agree. The bodies mentioned in the amendment have a direct interest in the museum. It is not unreasonable for Parliament to stipulate that that interest should continue. Those bodies would be able to contribute to the long-term well-being of the new museum.
      Sir Hector Monro: I oppose the amendment because, although it is tabled with the best intentions, it does not help the Minister to achieve the best balance in the new board of the museum. To limit the Minister's choice to six of the 15 would be extremely restrictive. All hon. Members who have served in government know that one of a Minister's most difficult jobs is the appointment of major and important boards and the achievement of the right blend of appointees to work harmoniously together, who have, if possible, a specific interest in and knowledge of the subject that they have been appointed to assist. If one restricts the number available to the Minister, that blend will be hard to find.
      Like the hon. Member for Orkney and Shetland (Mr. Wallace), I have received many letters from members of the Society of Antiquaries of Scotland, who are keen to ensure that they will be fairly represented. The Minister is right to keep all his cards on the table. I am prepared to bet that some members of the society will be appointed to the board, but it is right that we should leave the provision as it is.
      One of the outstations of the Royal Scottish museum is the aircraft museum at East Fortune. Would one therefore suggest that we should have an aircraft engineer or a pilot on the board? Should we have someone from Wigtownshire to look after the botanic garden outstation at Logan Gardens?
      It is important that the Minister should have the maximum freedom of choice. I am confident that, from the immense wealth of experience in Scotland, he will appoint the right board.
      Mr. Wilson: The hon. Member for Dumfries (Sir H. Monro) is far too generous and unsuspicious of the Minister and his Department. In Committee, I raised the matter of the vagueness of the criteria by which trustees
      154
      were to be appointed. It is almost entirely at the discretion of the Minister. The point was raised, especially regarding the National Museum of Antiquities of Scotland, that there was no requirement for appointed trustees to have specific or even general knowledge of Scotland. It is patently obvious that if we adopt the selection of people mentioned in the amendment, there will be people with a genuine interest in Scottish history and the development of the museums. Indeed, the range is wide.
      To develop a more general argument, one of the least attractive features of modern society is that the patronage of the Secretary of State has been built up and now extends into a wide area. We know that the Secretary of State may have the final decision, but he does not trawl for people who might fit the bill. His ministerial discretion is frequently exercised with a rubber stamp. The decisions about who is suitable are, broadly speaking, taken by civil servants. It is wrong that the Secretary of State, the omnipotent Pooh-Bah of the Scottish Office, should have such a wide range of different posts to fill.
      Earlier the Government were keen to abolish quangos, but that seems to have petered out. It appears that they are still interested in making appointments wherever they can, as a sort of extension of their influence and power. I do not share the confidence of the hon. Member for Dumfries in the ability of Secretaries of State to choose. It is right for us here and now to stipulate certain categories of person who could fill the job. Therefore, I warmly support the amendment proposed by the hon. Member for Orkney and Shetland (Mr. Wallace), because it fulfils in a more specific way the more general approach that I adopted in an amendment in Committee.
      Mr. Buchan: I hope that the Opposition's amendment No. 9 will be accepted, because it goes part of the same way that we are discussing in this group of amendments. It would at least write in the name of the body concerned, if the Government will not go further in regard to trusteeship as suggested by the hon. Member for Orkney and Shetland (Mr. Wallace). It would be a modest declaration of the position. I hope that the Minister will not tell us that it is unnecessary. We cannot trust future Governments any more than we can trust the present Government, and it would be useful to have the provision written into the Bill.
      We have also considered the nature of the operations of the trustees. We have tried to simplify the provisions. We had a long and difficult period trying to get the Government to see sense in regard to another institution, the national library. We recognised that, in the unlikely event of the Government giving proper time for debate on a Bill of this importance, it would be difficult to have a proper discussion of it. By putting on the debate late at night the Government have disguised some of their own iniquities and made it more difficult for the complete case to be deployed. It is a great pity that an important Scottish Bill of this kind should be taken after midnight rather than in the full light of day, when proper care and attention could be given to it. It was with that expectation of the behaviour of the Government that we tabled this modest amendment.
      The main purpose of our amendment No. 10 is to refer to the nature of the trusteeship and to say that we would want to achieve certain elements of continuity, rather than having a continual turnover. The interesting aspect is the comparison between the schedule, which determines the

      155
      trusteeship of the museums, and the clause, which determines the board and the trusteeship of the national library.
      It cannot make sense that one major national institution should be appointed entirely by the Secretary of State and that another one should be appointed on the say-so of a number of listed bodies. What is good for one should be good for the other. In one case almost as many people are appointed by the advocates of Scotland as there are appointed in the other case by the Secretary of State for Scotland. If the Secretary of State appoints nine trustees, that is almost the same as the seven or eight that the advocates have in their gift. That cannot make sense. One or the other must be wrong and I hope that their Lordships, when they look at it, will refuse to have such an intellectual inconsistency in the Bill.
      The listing of the trustees in clause 17. the other relevant clause, makes no sense of any kind. One can only regard it as an historical vestige that the advocates have a certain relationship with the origins of the library. We all accept that and would like to retain it. But if we are to have the form of list given in clause 17, the Secretary of State should adopt some relevant kind of list in the schedule in regard to the museums. I hope that attention will be paid to that aspect when the Bill goes to another place, so that the two provisions may be brought into some kind of harmony. There might then be an opportunity in the other place to have a more leisurely examination of the matters that were dealt with so summarily in Committee and here this evening.
      2 am
      It is interesting that, while care has been taken on behalf of the Society of Antiquaries of Scotland— I do not object to that— and one or two of the obvious bodies such as the Royal Society of Edinburgh, the Convention of Scottish Local Authorities and the universities, the trade union and Labour movement of Scotland has not been brought in. The people who built the museums are not represented. Those who did the work, created our history and built those buildings are not mentioned. That is a stark contrast. We sought to mention all the groups in relation to the library; it could have been done in the amendment. We could have given that matter some consideration. Such slip-ups happen when there is such speedy action from the Government as we have in the Bill. That is another matter that will have to be considered in another place. If the amendment is accepted in this form, it will have to be changed further to be more reflective of the bulk of the people of Scotland, above all in the light of our concentration on the museum of industry.
      While I respect the views of the hon. Member for Orkney and Shetland, who has attempted to make sense and bring things into harmony, which we support, and although the amendment is an improvement on the Bill, in which only the Secretary of State has the say-so, the amendment will lead to further amendment in the other place.
      Mr. Allan Stewart: The hon. Member for Paisley, South (Mr. Buchan) referred to the National Library. I should like to reiterate the point that I made in Committee. With regard to that board, we are dealing with an existing
      156
      institution that appears to work satisfactorily, whereas in relation to the museums we are setting up a completely new board.
      I understand the reasons for the amendment tabled by the hon. Member for Orkney and Shetland (Mr. Wallace) and why he feels that bodies such as the Society of Antiquaries of Scotland and the Royal Society of Edinburgh should have a right of representation on the new board, but the points made by the hon. Member for Paisley, South showed the difficulty of agreeing a list of who should have the right of representation. My hon. Friend the Member for Dumfries (Sir H. Munro) rightly pointed to the advantages of having the maximum flexibility in arriving at decisions that will be in the interests of all aspects of the work of the national museums. It is right that trustees should be appointed for their individual contributions rather than for any particular interest that they might represent. The Bill as drafted lists a wide range of matters that the Secretary of State will be required to review when he considers the areas of expertise from which future trustees might be drawn.
      Hon. Members referred in particular to the Society of Antiquaries of Scotland. They are right in recognising the special relationship that is traditionally enjoyed with the national museum. Nevertheless, having listened carefully to what has been said and read the representations that have been put to us, I believe that to include a reference to any one body or organisation, even one as closely associated as the society, would not, on balance, be sensible. It would imply that a particular outside body was entitled to be involved in the general decisions of the board.
      I know that Lord Bute's advisory board, which is having further discussions with the society this week, will want to consider any other ways in which the society's long-standing interest in the work of the national museum, which is recognised on both sides of the House, can continue to be recognised in the future. I note what the hon. Member for Paisley, South said about possible debates in another place, but it would be wrong of me to speculate on their contents.
      Mr. Wallace: I have listened carefully, but I am disappointed by the Minister's response. I accept that a new museum is being established, but one cannot simply ignore the history of the two bodies coming together to create it, especially the role of the Society of Antiquaries in providing the library of the national museum of antiquities.
      The Minister said that he hoped to have particular regard to the ability and interests of those appointed to the board. As the hon. Member for Paisley, South (Mr. Buchan) has said, the National Library of Scotland has a whole list of people, including the Lord President of the Court of Session and the Minister of the High Kirk of Edinburgh. With all due respect to the current incumbents of those offices, there is no reason to suppose that their successors will have any special interest or ability with regard to books or libraries, but the Government seem to have ignored that inconsistency.
      The hon. Member for Paisley, South suggested that the list should be extended to include representatives of the trade union movement on the new board. I have no objection in principle to that suggestion, which might also be discussed further in another place.

      157
      In view especially of the historical association of the Society of Antiquaries I hope that in the period between the Bill leaving this House and being discussed in another place the Government will think again on this.
      Amendment negatived.
      Amendment made: No. 8, in page 22, line 31, after 'agricultural', insert 'archaeological, artistic'.— [Mr. Allan Stewart.]
      Mr. Allan Stewart: I beg to move amendment No. 11, in page 23, line 39, leave out sub-paragraph (5) and insert—
      '(5) Where a person becomes an employee of the Board in consequence of this paragraph, then, for the purposes of the Employment Protection (Consolidation) Act 1978, his period of employment in the civil service of the State or, as the case may be, for the purposes of the National Museum of Antiquities of Scotland, shall count as a period of employment by the Board, and the change of employment shall not break the continuity of the period of employment.'.
      Mr. Deputy Speaker: With this it will be convenient to take Government amendments Nos. 12 to 15.
      Mr. Stewart: This group of amendments follows the discussions on Second Reading and in Committee and is important in that it concerns the staff of the new institutions. I gave specific assurances to the Opposition about meeting with trade unions and I met the unions on 19 December. In the light of the exchanges at that meeting and what was said in earlier stages of the Bill, to avoid any further misunderstanding and in particular to ensure that the staff concerned know that we intend to protect their interests as far as is practicable, I have agreed to embody in the Bill the assurances that I gave on Second Reading—the so-called Chalmers assurances.
      The Chalmers assurances provide that for any member of the Royal Scottish Museum who refuses an offer of employment from the new trustees a suitable post in the same grade in the Scottish Office would be sought, and that if that were unattainable the staff transfer unit of the Management and Personnel Office would be asked to seek such a post elsewhere in the Civil Service. Amendment No. 13 gives statutory backing to those assurances and has been welcomed by representatives of the staff concerned.
      In addition to embodying those assurances in the Bill, the amendments remove certain other areas of possible doubt. Amendment No. 11 proposes the substitution of a new subparagraph (5) to paragraph 5 of schedule 1. That amendment, taken with amendment No. 12 to subparagraph (6), ensures that all staff presently employed for the purposes of the institutions comprising the national museums of Scotland and who accept the offer of employment from the trustees will have continuity of employment and any question of technical redundancy entitling anyone to a redundancy payment will be avoided.
      Amendment No. 14 to subparagraph (7) ensures that not only staff who are civil servants but also those non-civil servants employed in the National Museum of Antiquities of Scotland will be entitled to appeal to an industrial tribunal if they think that the offer of employment which has been made to them by the board is on terms less favourable than those applying to them before the date of the offer.
      I emphasise that none of these amendments implies any change in policy. The Government have always been firmly committed to the Chalmers assurances and it has always been our intention that the staffing provisions of schedule 1 should apply to all museums staff.
      158
      With regard to the staff of the National Museum of Antiquities of Scotland, in terms of the Chalmers assurances the Bill makes a distinction in favour of Royal Scottish Museum staff. I should perhaps explain why that is so.
      Hon. Members will be aware that the Bill deals with two quite distinct groups of museum staff— there are Scottish Office staff at the RSM and those seconded to the NMAS. They are all civil servants. If they accept the offer of employment from the trustees, they will become non-civil servants. There are also the non-civil servants in the NMAS who are at present employed by a board of trustees, and who will not be changing their status. If they accept the offer of employment from the new board, they will merely change from being the employees of one board to being the employees of another.
      The Chalmers assurances relate only to the first group of staff. That has always been understood. It was specifically stated in Mr. Chalmers' original letter and has always been repeated in those terms. On 10 January, however, at the meeting of the joint working party set up to consider the implications for museums staff of this Bill, the trade union side asked that consideration be given to extending the Chalmers assurances to appropriate staff of the NMAS— that is, staff certificated by the Civil Service Commission.
      In fact, I fully expect all NMAS staff to accept employment with the new museums so that they can continue to develop their chosen specialties. However, I am sure that the House agrees that it is important that we do everything possible in the interests of good staff relations for the new structure. I am, therefore, prepared to meet the point made by the trade union side and to give an undertaking to NMAS staff that for any eligible NMAS staff who refuse an offer of employment, the Secretary of State will seek a post in the same grade in the Civil Service.
      With that assurance, I hope that any remaining misunderstandings will be removed, that the staff concerned will feel fully reassured and that the House will be satisfied as to the Government's intention.
      Amendment No. 15 gives the staff at the Royal Botanic Garden the same assurances as are given to the staff of the RSM. Since all the staff presently employed at the Royal Botanic Garden are civil servants, there is no need to make the other amendments.
      I apologise for speaking at some length, but these are important matters. It is an important group of amendments. We wish to do everything possible to give the reassurances to the staff that I am sure the House will agree are correct.
      Mr. Craigen: I am grateful to the Minister for giving such a full explanation of the amendments. He knows that I have expressed strong views about the way in which the issues came before the Scottish Grand Committee during Second Reading. Many of the issues should have been properly thrashed out before the Bill was even published.
      I acknowledge that the Minister has gone some distance in reducing the concerns expressed by the three staff associations. There is still some uncertainty whether he has accepted some points in their entirety. There are some aspects upon which he might expand, and one relates to the NMAS. A group of curators and research staff are still

      159
      a little apprehensive about the position. It would be useful to know just how active the staff transfer unit would be—
      Mr. Henderson: I have heard some rumour about anxiety, but I suspect that it is about something with which we cannot deal in the Bill. Because of historical differences, there is a slight difference in grading and structure. As long as my hon. Friend the Minister draws that to the attention of the new board, that should be taken into account.
      Mr. Craigen: Yes, I am hoping that these matters will be resolved by what the Minister has to tell us. However, I am sure that the hon. Member will agree that it was nonsensical that we had to discuss this matter on Second Reading and in Committee because normally, with transfer arrangements such as this, the whole business would have been cut and dried and ready for the approval of Parliament.
      Schedule 1(6)(a) deals with a suitable alternative position in the Civil Service. It has been put to me that it would be reasonable to add on a phrase such as "or non-departmental body", as there might be people who would wish to, and could find a job with the other non-departmental bodies that have been established by the previous legislation relating to England.
      2.15 am
      Mr. Allan Stewart: I thank the hon. Member for Glasgow, Maryhill (Mr. Craigen) for his reception of these amendments. I confirm that we are not changing Government policy, but the trade unions wished these assurances to be given legislative form. In essence, we have accepted that. I assure him that we do not expect any difficulties, and the trade unions do not expect many either.
      The staff in the NMAS to whom the hon. Gentleman referred are not civil servants, but the union did not ask that these assurances should be given statutory form, and, given that the National Museum of Antiquities of Scotland staff are not civil servants, I am sure that the House will agree that this would not be suitable. The trade unions asked for an assurance on the record, and that is the assurance that I give the House tonight.
      Amendment agreed to.
      Amendments made: No. 12, in page 24, line 3, leave out
      160
      'in the civil service of the state'
      and insert
      'as mentioned in sub-paragraph (1)'.
      No. 13, in page 24, line 13, at end insert—
      '(6A) Without prejudice to sub-paragraph (6) above, where a person in the civil service of the State has unreasonably refused an offer made to him in pursuance of this paragraph, the Secretary of State shall not terminate that person's employment unless he has first had regard to the feasibility of employing him in a suitable alternative position in the civil service.
      (6B) Where a person continues in employment in the civil service either—

      (a) not having unreasonably refused an offer made to him in pursuance of this paragraph, or

      (b) having been placed in a suitable alternative position as mentioned in sub-paragraph (6A) above,

      he shall be treated for all purposes as if the offer mentioned in sub-paragraph (1) had not been made.'.
      No. 14, in page 24, line 17, leave out
      'in the civil service of the State'
      and insert
      'immediately prior to the making of the offer mentioned in subparagraph (1)'.
      No. 15, in page 28, line 40, at end insert—
      '(6A) Without prejudice to sub-paragraph (6) above, where a person has unreasonably refused an offer made to him in pursuance of this paragraph, the Secretary of State shall not terminate that person's employment unless he has first had regard to the feasibility of employing him in a suitable alternative position in the civil service.
      (6B) Where a person continues in employment in the civil service either—

      (a) not having unreasonably refused an offer made to him in pursuance of this paragraph, or

      (b) having been placed in a suitable alternative position as mentioned in sub-paragraph (6A) above,

      he shall be treated for all purposes as if the offer mentioned in sub-paragraph (1) had not been made.'.— [Mr. Archie Hamilton.]
      Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 58 (Third Reading), and agreed to.
      Bill accordingly read the Third time, and passed.

    WELSH GRAND COMMITTEE
    Ordered,
    That, during the proceedings on the matter of Regional Policy as it affects Wales, the Welsh Grand Committee have leave to sit twice on the first day on which they shall meet; and that, notwithstanding the provisions of Standing Order No. 67 (Meetings of standing committees), the second such sitting shall not commence before five o'clock nor continue after the Committee have considered the matter for two hours at the sitting.—[Mr. Archie Hamilton.]

  Ex-Miners (Unemployment Pay)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Archie Hamilton.]
  2.17 am
  Mr. Geoffrey Lofthouse: I am grateful, even at this late hour, to have the opportunity to bring to the notice of the Minister and the House the injustice that many unemployed ex-miners are experiencing, even though the problem has been pointed out to Ministers in the Departments of Energy and of Health and Social Security.
  This problem applies to 400 or 500 ex-miners. I shall give an example of one man, which will show the problems for all such men. My constituent, Mr. A. J. Robinson, on 13 February 1984, along with 20 other miners at the Kellingley colliery, was interviewed by a representative of the National Coal Board. The men were offered terms, and encouraged to take redundancy. It was explained exactly what it would mean for them if they were to accept the NCB's offer. The terms included unemployment benefit, sickness benefit, mineworkers pension schemes, and so on. It also included a weekly income. They were issued with small pieces of paper, which I have with me, telling them what day they would be put on notice, what day their notice would expire, and much more information. They were also issued with a document showing what their lump sum payments and weekly incomes would be if they accepted the redundancy terms.
  Arising from that information, those men, in good faith, accepted the redundancy terms. They were told on what date their notice would expire and on what date they would be expected to sign on at the unemployment office. When they attended the unemployment office, they were told that they did not qualify for unemployment benefit, because, since they had been put on notice, there had been a strike in parts of the coalfield.
  When the men were interviewed, it was not pointed out to them that, if there was a strike, they would lose their entitlements. After receiving representations from Mr. Robinson, I wrote to the Minister then responsible for coalmining, the hon. Member for Pudsey (Mr. Shaw), now the Minister of State, Home Office, who replied to me in a letter that he was aware of the matter, recognised the injustice, and had decided to act to change the rules. He assured me that the Government and the National Coal Board were determined that men who took redundancy, and therefore helped the industry towards a better future, should receive generous redundancy pay. He said that neither had any desire to see such men penalised as a result of the strike. A similar assurance was given by the Secretary of State for Energy on 25 May in answer to a written question.
  On 26 November, the Secretary of State, through the Under-Secretary of State for Energy, acknowledged the injustice and presented on to the House the draft Redundant Mineworkers and Concessionary Coal (Payments Schemes) Order 1984, which ended the link between the qualification for redundancy payments and unemployment benefit. Previously, if a man wished to qualify for redundancy payments, he had to qualify for unemployment benefit. As the order ended the linkage, the Department of Energy conceded that those men were no
  162
  longer employed in the mining industry and were unemployed. The fact that they received weekly redundancy payments meant that they were unemployed.
  In the debate on 26 November anxiety was expressed by hon. Members on both sides of the House— none more forcibly than the hon. Member for Staffordshire, South (Mr. Cormack), who had received similar complaints from his constituents. That order went some way to redress the injustice, but it did not go all the way, because these men are still not receiving unemployment benefit. I understand that the adjudicator who dealt with their cases believes that the men are in some way involved in the strike. That is not the case. After Mr. Robinson had appealed against the Department of Employment's decision to disallow unemployment pay, the Department wrote to him on form UB 123 on 7 June 1984:
  "The claimant is disqualified from receiving unemployment benefit … because he has lost employment owing to stoppage of work which was due to a trade dispute at his place of employment."
  But Mr. Robinson has no place of employment. He was not on the colliery books. The Department of Energy has conceded that. Mr. Robinson received form RP 3 from the NCB informing him of his entitlements. That form stated that his employment had ended on 14 April 1984.
  I understand that the Department of Employment has used section 19 of the Social Security Act 1975 to deny those people their entitlement. Section 19 (1) states:
  "A person who has lost employment as an employed earner by reason of a stoppage of work which was due to a trade dispute at his place of employment shall be disqualified for receiving unemployment benefit so long as the stoppage continues, except in a case where, during the stoppage, he has become bona fide employed elsewhere in the occupation which he usually follows or has become regularly engaged in some other occupation; but this subsection does not apply in the case of a person who proves—

  (a) that he is not participating in or financing or directly interested in the trade dispute which caused the stoppage of work; and

  (b) that he does not belong to a grade or class of workers of which, immediately before the commencement of the stoppage, there were members employed at his place of employment any of whom are participating in or financing or directly interested in the dispute."

  Mr. Robinson is certainly not participating in the dispute. He is off the books. Even if he had wished to do so, he could not have returned to work. He is unemployed. He is unemployed not because of the stoppage, but because the NCB offered him redundancy pay.
  It appears that the Department of Employment is hanging its cap on the provision that, to qualify for benefit, a claimant must prove that he has not participated in, financed, or been directly interested in the dispute. If that is the case, those men feel that they were deceived in their interviews, and I share that view.
  Section 19 of the 1975 Act has been the subject of much case law. In the past couple of days, I have been looking at "Neligan's Social Security Case Law" and some commissioners' decisions. My researches have not uncovered any identical decisions. The closest involves a 60-year-old claimant who was given notice by the NCB that his employment as a salvage worker would end on 20 January. Meanwhile, a national coal strike had begun on 9 January and the claimant withdrew his labour, along with other members of the NUM.
  There is not a national coal strike. Nearly one third of the miners have been working throughout. Many of the miners at the colliery where my constituent worked are

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  working. Who is to say that if he had not been taken off the books and made redundant he would not be working now? But he is not working because he cannot do so— he is unemployed.
  I think that I can anticipate some of the Minister's answers, but the Department of Energy has acknowledged the injustice and produced regulations to put right its side of things. I suggest that the Department of Employment or the DHSS has an obligation to those men not to stick rigidly to the regulations, as the adjudicator seems to be doing. I hope that the Minister will consider the issue carefully and will apply pressure in the right quarters.
  There is great concern in the areas involved. My local newspaper, the Pontefract and Castleford Express, ran a big headline on the subject:
  "Row over Pitmen's Loss of £2,000."
  Thus, the local newspapers have also expressed concern.
  My hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) received a letter from the Secretary of State dated 10 January 1985, in which he refers to a letter sent by my hon. Friend involving a similar case. In his last paragraph the Secretary of State writes:
  "I understand that the National Coal Board have appealed against the Social Security Appeal Tribunal's decision to disallow Mr. Weatherill's claims to the Social Security Commission. I am afraid that I am unable to predict the outcome or intervene for the reason that I have already given."
  Perhaps the Minister can tell us what the case is. Are those involved NUM members, part of management, or do they belong to some other category? I should be interested to know.
  However, I hope that the Minister will give serious consideration to those men who have served the industry for 40 years or more and who took their redundancy terms in good faith, which I believe were offered to them in good faith by National Coal Board officers. I hope that the hon. Gentleman will use his powers to bring an end to this injustice.
  Mr. Alec Woodall: I am most grateful to my hon. Friend the Member for Pontefract and Castleford (Mr. Lofthouse) for giving me permission to contribute briefly to the debate. I wish to draw an entirely different case to the attention of the House, which involves miners who have been dismissed by the NCB for some minor misdemeanour. As hon. Members with mining interests will know, once an NCB employee has been dismissed for any reason—even for petty pilfering, and before he has appeared in court—he will never again be employed by the NCB. He is taken off the books and stays off the books.
  During the current dispute many men have been accused of, and sometimes charged with, minor misdemeanours such as petty pilfering, the stealing of little bits of coal with which to warm their houses or even firewood. They have been dismissed and are off the colliery books, yet they are classed as striking miners and are not allowed to sign the register as unemployed. They are doubly punished for their misdemeanours. They lose their jobs and are then taken to court where a sentence is imposed for pilfering.
  Another dimension to this issue was brought to my attention only a few days ago by a probation officer employed in the Wakefield district service. It involved a young apprentice miner who had committed an act of petty
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  pilfering and who was immediately sacked by the NCB. When he heard of it, the colliery manager was very dismayed, because he knew the lad had a good intellect and was a good prospect for the NCB. He was of exemplary character and would have made quite a career for himself in the NCB. The manager was so upset that he wrote to the young man saying "Not to worry. When the strike's over, you come and see me and I shall see that you get your job with the National Coal Board back." That was his mistake. That letter got into the wrong hands. The colliery manager's superiors got hold of it and the colliery manager received a letter saying in no uncertain terms that if, when the strike is over, he re-employs this young fellow, he, the manager, will be sacked— and no two ways about it.
  What is the NCB trying to do? The young man was guilty only of petty pilfering. He has lost his job with the Coal Board and lost his career. The probation officer drew the case to my attention because the young man has been before the court, is out of a job and wants to take part in a youth training scheme. He cannot, because he is not unemployed. He is not allowed to sign the register. Because he is not unemployed he cannot take part in a youth training scheme to try to build another career for himself. He is being doubly punished for his small misdemeanour. I appeal to the Minister to state that if a man commits a crime, whatever it is, and is dismissed by the Coal Board, he has been sacked, he is no longer employed by the board and never will be.
  In many areas the local colliery is the only place of employment for men. This young fellow lives in an area of high unemployment and he cannot even take advantage of the Government's youth training scheme because he is not unemployed although he is off the board's books and has no chance of getting a job. I beg the Minister to examine the matter.
  2.36 am
  The Parliamentary Under-Secretary of State for Health and Social Security (Mr. Ray Whitney): I recognise that of the many social security issues that have arisen during the current coal mining dispute, one of the most difficult is that which has been raised tonight by the hon. Member for Pontefract and Castleford (Mr. Lofthouse)— the problem of the payment of benefit to those miners who have left the industry and are now unemployed. I am grateful to the hon. Member and the hon. Member for Hemsworth (Mr. Woodall) for allowing me to explain the position.
  I shall deal first with unemployment benefit. I remind the House that the relevant legislation is an Act introduced by the last Labour Government. Section 19 of the Social Security Act 1975 provides that a person who has lost employment as a result of a stoppage of work due to a trade dispute at his place of employment is disqualified from receiving unemployment benefit unless he can show that he is not participating in or directly interested in the trade dispute which caused the stoppage of work.
  A rule of this kind has been part of the national insurance scheme since 1948—also of course a year of Labour Government—and before that it was a feature of unemployment insurance in a slightly different form from 1911, which was a year of a Liberal Government. Once a person has lost employment as a result of a trade dispute he remains disqualified from receiving unemployment benefit for as long as the stoppage of work resulting from

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  the dispute continues. He can escape disqualification only by becoming bona fide employed elsewhere in his normal occupation or regularly employed in another occupation. Of course, decisions on whether a person is disqualified from receiving unemployment benefit are for the independent adjudicating authorities and Ministers have no power to intervene in this process.
  The hon. Member for Hemsworth referred to a number of matters which fall within the responsibility of the NCB and to some extent of my right hon. Friend the Secretary of State for Energy. However, individual benefit claims arising from the loss of work relating to the trade dispute do fall within the realm of adjudicating authorities.
  I should like to emphasise that there is no question of any special harsh or invidious treatment of miners or their dependants. Indeed, I remind the House that about £29 million has already been paid in supplementary benefit to miners' families. In the case of redundant mineworkers, far more claims to unemployment benefit have been allowed than disallowed over the past nine months or so. Therefore, there is no question of our seeking to use the social security system to penalise miners or ex-miners.
  Nevertheless, there can be complications for someone, not just a miner, who becomes redundant during the course of a trade dispute. For example, a person whose redundancy comes into effect while he is on strike, whether he was given notice before or after the strike started, is disqualified from receiving unemployment benefit until the dispute ends. A striking miner who returns to his job and later becomes redundant is still disqualified when the redundancy takes effect until such time as the dispute ends. That is the effect of section 19(1) of the Social Security Act 1975 and the interpretation put upon it in the past by the social security commissioners whose decisions form case law, which is binding upon both adjudication officers and appeal tribunals.
  I am aware that the way in which the law works can seem unfair in some cases, such as those referred to tonight, and I have particularly in mind those miners who were absent for only one or two days at the start of the dispute and, in some cases, where they had done everything possible to get to work but were physically prevented from doing so. A number of such cases are now awaiting hearing by the social security commissioner.
  If a claim for supplementary benefit is made by a miner in the circumstances that I have described, the supplementary benefit adjudicating officer has to take account of any decision concerning the trade dispute which has been made for unemployment benefit purposes. If a decision about the unemployment benefit position has not yet been taken, or an appeal is pending, any supplementary benefit claim has to be dealt with meanwhile on the assumption that the decision will be adverse.
  One other issue has arisen regarding redundant mineworkers which I ought to mention and which highlights the fact that mineworkers who are made redundant are normally in a far better position than workers in other industries. That is because, as the hon. Member for Pontefract and Castleford recognised, they are entitled to redundancy payments under the redundant mineworkers payments scheme.
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  Those weekly payments could be made only if the individual satisfied the conditions for receiving unemployment benefit. The effect of those rules and social security legislation together was that miners who had been involved in the strike were not entitled to unemployment benefit, and therefore were not entitled to weekly redundancy payments. Department of Energy Ministers, as has been acknowledged, introduced an amending order which took effect on 7 December to rectify that situation.
  The result is that redundant mineworkers now receive their weekly payments from the National Coal Board despite the trade dispute disqualification from receiving unemployment benefit. By the same order my right hon. Friend the Secretary of State for Energy was given powers to make discretionary payments to miners who had not been able to receive such payments before the amendment order came into operation.
  However, the position regarding unemployment benefit remains as I explained earlier, and the disqualification from receiving benefit continues to apply until the stoppage of work at the claimant's place of employment comes to an end or until the claimant obtains bona fide employment elsewhere in his occupation or he becomes regularly employed in another occupation.
  I fully appreciate that the situation that I have described has been a source of serious concern to hon. Members on both sides of the House. To a large extent, though, that is because the adjudication authorities have had to apply the statute law in situations not met before and they have had to follow case law which was decided in different circumstances, although close enough to make it binding now.
  After all, we are dealing with a dispute of unprecedented length, involving violence and intimidation on a scale not previously witnessed in this country. We would not, therefore, want to undertake hastily or lightly any revision of section 19 of the Social Security Act 1975, which, I remind the House, was passed by a Labour Government.
  We shall, of course, look very closely at the outcome of the social security commissioners' decisions on the cases now going to them, and in the end we may well have to amend the law, or certain aspects of it, but I should remind the House once again that we are talking about legislation which is based on principles which go back to 1911, and which have been recognised as sound by previous Administrations of all political colours.
  I hope that both hon. Gentlemen who have spoken will recognise the force of the case. I recognise the problems caused by individuals, but we must accept at the end of the day that this situation has arisen because of the extraordinary length of the strike and the pressure brought on these men by other members of the National Union of Mineworkers. I also remind the House that special arrangements have been made by the Government, as witnessed by the changes to the operation of the miners' redundancy scheme.
  Question put and agree to.
  Adjourned accordingly at fifteen minutes to Three o'clock am.