Commons Sitting of 6 June 1985

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

  PRIVATE BUSINESS
  C-POULTRY COMPANY LIMITED BILL
  Read the Third time, and passed
  ROYAL BANK OF SCOTLAND BILL (By Order)
  Lords amendments agreed to.
  BATH CITY COUNCIL BILL [Lords] (By Order)
  Read the Third time, and passed, with an amendment
  PLYMOUTH MARINE EVENTS BASE BILL (By Order)
  Read the Third time, and passed.
  YORKSHIRE WATER AUTHORITY BILL (By Order)
  Order for Second Reading read.
  To be read a Second time upon Thursday 13 June

Oral Answers to Questions
  HOME DEPARTMENT

    Temporary Admissions
    Mrs. Clwydasked the Secretary of State for the Home Department how many passengers granted temporary admission to the United Kingdom absconded in 1984; and what percentage this is of those so admitted.
    The Minister of State, Home Office (Mr. David Waddington): In 1984 a total of 8,527 passengers were given temporary admission either pending further examination or after refusal of leave to enter. Of these, 187 or just over 2 per cent absconded.
    Mrs. Clwyd: Does the hon. and learned Gentleman agree that Tamils fleeing persecution would make as good citizens of this country as the children of the Lithuanians who fled from their country a generation ago?
    Mr. Waddington: The matter raised by the hon. Lady is of great importance, but it goes very wide of this question. A short time ago we announced what we think is a fair policy towards Tamils. First, we shall acknowledge and honour our obligations under the United Nations convention on refugees. Secondly, we have said that we shall not send back any Tamil who would suffer severe hardship if returned.
    Ms. Clare Short: In view of those figures, does the Minister agree that his officials are refusing to let many genuine visitors into this country and putting them in the humiliating position of being detained at airports and
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    having to seek out a Member of Parliament in order to get
    permission to see their relatives? Does the hon. and
    learned Gentleman also agree that we should—
    Mr. Speaker: Order. The question is about absconding. Is not this matter a little wide of the question?
    Ms. Short: No, Mr. Speaker.
    Mr. Speaker: The hon. Lady may proceed.
    Ms. Short: It is absolutely in order.
    Mr. Speaker: With respect, I decide that.
    Mr. Waddington: I am always willing to oblige, Mr. Speaker. Some might say that the low level of absconding confirms the judgment of immigration officers in granting temporary admission. It is somewhat illogical to argue that, because people have not absconded, they must have qualified for entry as visitors and therefore were wrongly refused entry.
    Mr. Dubs: Will the hon. and learned Gentleman
    confirm that last Tuesday evening, for the first lime, a
    Tamil who had sought asylum in this country was returned
    direct to Sri Lanka and that that occurred because of an
    administrative muddle by Home Office officials? Will the
    hon. and learned Gentleman now say categorically—
    Mr. Speaker: Order. The same rules apply to the Front Bench as to the Back Bench. That question would more correctly be asked on question No. 8.
    Mr. Dubs: The issue concerns a person who, I believe, was held in custody to prevent him absconding.
    Mr. Speaker: The point is that he did not abscond.

    Police Forces (Strength)
    Mr. Hunterasked the Secretary of State for the Home Department if he is satisfied with the present manning levels of police forces.
    The Secretary of State for the Home Department(Mr. Leon Brittan): There were 120,364 police officers and 39,299 civilian staff in England and Wales on 30 April. This was a total increase of 12,919 since May 1979; it was also an increase of 461 since March of this year.
    Mr. Hunter: I applaud the professionalism and dedication of the police and welcome the measures that the Government have taken to increase manpower, but the fact remains that the burden of responsibility and duty that the police must now shoulder has increased significantly since 1979. In some parts of the country there appears to be little more than a minimum level of effective policing. Will the Government give urgent consideration to a further increase in police manpower?
    Mr. Brittan: I agree that the burdens on the police since 1979 have increased, and it is for exactly that reason that the numbers of police have been increased.
    With regard to the position in particular parts of the country, obviously I consider applications for increases in police establishment on their merits.
    Mr. Dobson: If there are sufficient police, why have the numbers of crimes increased from 2.5 million in 1979 to 3.5 million in 1984?
    Mr. Brittan: I think that the hon. Gentleman knows enough about the causes of crime to realise that they relate

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    as much to what criminals do as to the presence of policemen. Were it not for the strengthening of the forces of law and order, I have no doubt whatever that, with the increase in crime that is occurring all over the Western world, crime would be far worse in this country.
    Mrs. Ann Winterton: Is my right hon. and learned Friend aware that, in cases recently brought to my attention, there has been a delay of over 15 minutes in response to an emergency call before even one police officer has arrived on the scene? Obviously, further action, such as an arrest, is precluded until reinforcements arrive. Does my right hon. and learned Friend agree that that is a reflection of inadequate manning levels and that the public should be assured that they will have a prompt and efficient response to any emergency call?
    Mr. Brittan: I agree that it is important that emergency calls should be dealt with on an emergency basis. My hon. Friend obviously has a particular case in mind. If she would like to get in touch with me, I shall look into it and see what went wrong.
    Mr. Soley: Given that the Home Secretary thinks that he has done so much for the police in manning and other areas, why does he think that he received such a hostile reception at the police conference?
    Mr. Brittan: The hon. Gentleman might like to compare that response with the one that his right hon. Friend received.
    Mr. Hayes: I appreciate that my right hon. and learned Friend is committed to doing everything he can to ensure that we have an efficient and effective police force, but is he aware that there is widespread concern among officers in the metropolis that the present restrictions on overtime may be hampering inquiries? Will he investigate those allegations?
    Mr. Brittan: It is important that the police should operate efficiently. I think that the measures that the commissioner has introduced to regulate overtime are an important part of the process of ensuring that the police do operate efficiently.

    Coal Industry Dispute
    Mr. Skinnerasked the Secretary of State for the Home Department how many miners arrested during the miners' strike are still in prison; and if he will make a statement.
    The Parliamentary Under-Secretary of State for the Home Department (Mr. David Mellor): The occupation of prisoners is not recorded centrally.
    Mr. Skinner: Is the Minister aware that during the miners' strike most Ministers talked of the strike as being a political strike? If that is the case, those miners who are still in prison are political prisoners. If it is in order for Ministers to trot over to east European countries and claim that there are political prisoners there who should be brought out, surely it is right for Labour Members to call for an amnesty for those miners who are in prison. Would the Minister not be better disposed rounding up the crooks at Johnson Matthey who have been giving out backhanders in order to get £75 million in rescue deals?
    Mr. Mellor: The logical powers of the hon. Gentleman make those of Lewis Carroll and Edward Lear appear positively prosaic by comparison.

    Shoplifting
    Mr. Jannerasked the Secretary of State for the
    Home Department how many people tried on indictment
    for shoplifting in 1983, 1984, and 1985, respectively,
    were acquitted.
    Mr. Mellor: In England and Wales in 1983, 1,133 persons were acquitted in the Crown court of theft from shops, and 3,362 were found guilty. Corresponding information for 1984 and 1985 is not yet available.
    Mr. Janner: As I am sure the Minister will agree, the situation in this area of law and practice is totally unsatisfactory. Will he confirm that when the new independent prosecution service comes into operation the prosecution of accused shoplifters will no longer be left to shopkeepers, and that meanwhile he will give instructions to the police to follow the same sort of procedures when deciding whom to prosecute—where they do—as are now followed successfully and well in areas such as Essex and Leicester?
    Mr. Mellor: I appreciate the hon. and learned Gentleman's interest, which I share, in this matter. I am happy to confirm that one of the many beneficial consequences of the new independent prosecution system will be that in the one area of the country where prosecutions for these offences are habitually undertaken by the stores—that is, in Greater London—prosecutions will be taken over for the most part by the independent prosecution service. The hon. and learned Gentleman will welcome the fact that in the circular sent out by the Home Office in February about cautioning, particular attention was drawn to the importance of cautioning in relation to vulnerable elderly offenders. He will also be interested to know that of the number of offenders over 60 cautioned and found guilty, the proportion cautioned increased from 48 per cent. in 1980 to 61 per cent. in 1983. The circular will probably lead to an increase in those figures.
    Mr. Adley: Is my hon. Friend aware that as long ago as 1972 I had my first Adjournment debate on this subject, when my right hon. and learned Friend the Member for Warrington, South (Mr. Carlisle) accepted that there was a direct link between the increasing number of self-service stores and the increase in shoplifting? Does the Home Office accept that where trading methods cause crime, that cause and effect should not be ignored by society?
    Mr. Mellor: The issue of prevention is crucial and we continue to have well in mind the point that my hon. Friend makes.

    Primary Purpose Rule
    Mr. Pikeasked the Secretary of State for the Home
    Department if he will publish the instructions to entry
    certificate officers regarding the primary purpose rule.
    Mr. SimonHughes asked the Secretary of State for
    the Home Department whether he will now introduce
    legislation to abolish the primary purpose rule for financés
    and husbands wishing to join partners in the United
    Kingdom.
    Mr. Waddington: I will, with permission, answer this question and question No. 6 together.
    Mr. Hughes: On a point of order, Mr. Speaker. Can these two questions be answered by the Home Secretary rather than by an Under-Secretary?
    Hon. Members: Sit down.
    Mr. Speaker: Order. The hon. Member knows that that is not a point of order for me. Who answers questions is a matter for the Department concerned.
    Mr. Waddington: Instructions to immigration staff are being reviewed, in the course of which the extent to which they can be published will be considered. The issue of guidance to entry clearance officers is a matter for my right hon. and learned Friend the Foreign and Commonwealth Secretary. The Government do not intend to abolish the primary purpose test.
    Mr. Pike: Is the hon. and learned Gentleman aware that this rule causes more difficulties than most other aspects of immigration policy? In view of the recent decision of the European Court of Human Rights, may we have an assurance that, when changes are made, men coming into the country will be treated on the same basis as women coming here? Is the Minister further aware that that does not mean any change being made adversely? We want change in the right direction, so that the position as it now applies to women is extended to men.
    Mr. Waddington: It would be absurd if, having tightened up the work permit system to prevent young men coming here and going on to the labour market, we were to allow those same young men to come here by using marriage as a device. The judgment to which the hon. Gentleman refers does not directly concern the primary purpose rule, but obviously we are now considering the whole position in the light of the judgment and will announce our conclusions in due course.
    Mr. Hughes: Perhaps one day the Home Secretary will take some responsibility for these matters. In the meantime, will the Government respond — as the Government, whom they assert they are, of law and order —by obeying the 12th finding against this country by the European Court of Human Rights? As the Government, as they assert they are, of the family, will they allow husbands and fiances to come to this country with their families? As the Government, as they assert they are, of equal opportunity, will they ensure that we have a new set of immigration laws before the House rises for the summer? May we also be assured that nobody who is at present in breach of the rules which have been found to be contrary to human rights is penalised, and that that will apply from the date of the Strasbourg ruling?
    Mr. Waddington: It seems to have escaped the hon. Gentleman's notice that we first accepted the right of individual petition to the court back in 1966. Only in 1981 did France accept that right. In those circumstances, and as many other countries still do not accept the right of individual petition to the court, it is not surprising that more judgments have been made against the British Government than against other Governments.
    The country would be immensely surprised if, having willed a firm and fair immigration control, we now took the view that anybody who enters into a marriage, irrespective of whether that marriage is entered into for immigration purposes, should be able to come here.
    Mr. Stanbrook: On the question of the judgment by the European Court of Human Rights, are the Government content that a group of unelected foreigners should legislate for this country on matters of political and social importance?
    Mr. Waddington: We adhere to the convention and we shall abide by it. We shall make rule changes, but my hon. Friend will have to be patient, because we shall have to study the judgment carefully.
    Mr. Watts: Does my hon. Friend agree that the primary purpose rule is an essential safeguard for many brides, such as those in my constituency, about whom I have written to my hon. Friend, who were abandoned by their husbands when the two-year period necessary for their husbands to have an unlimited right to remain here expired?
    Mr. Waddington: The justification for the primary purpose rule is that it is a necessary part of our immigration control, but we should be stupid not to recognise that social problems are involved. My hon. Friend is absolutely right to hint at them today. We all know of cases where the primary purpose rule has been a safeguard for young women here.
    Mr. Dubs: Is the Minister aware that he made an astonishing blunder in answering an earlier question this afternoon? Is he further aware—
    Mr. Speaker: Order. The hon. Gentleman cannot ask that. We have passed that question.
    Mr. Dubs: Is the Minister aware that he made an astonishing blunder in answering a question just a moment ago? Is he further aware that he said that he was considering what to do about the European Court decision, yet earlier he said that the Government did not intend to abolish the primary purpose test? As the primary purpose test was the subject of the condemnation of our immigration practices by the European Court, because it is a key element in sex discrimination, how can the Minister say that he is open-minded and considering the result? He has already said that he has made up his mind.
    Mr. Waddington: The judgment does not directly concern the primary purpose rule. I repeat that we shall study the judgment with care. and do that which is necessary.
    Several Hon. Members rose—
    Mr. Speaker: Order. I apologise to the hon. Member for Battersea (Mr. Dubs), but I got the meaning of his question wrong.

    Sports Facilities (Safety)
    Mr. Altonasked the Secretary of State for the Home Department whether he will make a statement on the implications for safety and security at other sports facilities in the light of the disaster at Bradford City association football club.
    Mr. Brittan: While those will in the longer term be matters upon which the Government will look to Mr. Justice Popplewell's inquiry for advice, I have taken the following immediate steps as a result of my statement on 13 May. First, chief fire officers were asked on 16 May as a matter of urgency to visit all uncertificated sports stadia within the definition of the 1975 Act and to advise management on any necessary safety measures.
    Secondly, on 23 May, consultation letters were sent to the football authorities and other interested parties on the timetable for designation of the third and fourth division Football League grounds, which I had promised would be put in hand immediately.

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    Thirdly, on the same day, I announced to the Rugby League my intention also to extend designation, although not necessarily on the same time scale, to the grounds of clubs in divisions 1 and 2 of the Rugby League.
    Mr. Alton: I am grateful to the Home Secretary for that reply. How long will he give the clubs before they are expected to implement the Prime Minister's recommendations on personal security cards, the security of grounds and segregation? Will he be entering into talks, even if informal, with the organisers of sports in other grounds? What response—
    Mr. Heffer: On a point of order, Mr. Speaker. The hon. Gentleman is not in order.
    Mr. Speaker: Order. The hon. Member for Liverpool, Mossley Hill (Mr. Alton) must keep in order.
    Mr. Alton: I am in order, Mr. Speaker. A supplementary question is in order.
    What response will the Home Secretary. give to those clubs which have asked for funds to carry out much needed improvements to their grounds?
    Mr. Brittan: I think that the question of cards and other such matters go beyond the question, but those matters are being actively discussed with the football authorities. On the question of funds, the hon. Gentleman will recall what my right hon. Friend the Prime Minister said on Tuesday.
    Mr. Waller: While it appears certain that association football clubs can do something to make their grounds safer through funds available from the Football Grounds Improvement Trust, will my right hon. and learned Friend consult his right hon. and hon. Friends about the particular problems of Rugby League clubs, many of which have old wooden stands, but, unfortunately, no similar recourse to funds?
    Mr. Brittan: My hon. Friend the Minister with responsibility for sport will be considering with the Rugby League the implications of the proposed extension of designation to the grounds of clubs in divisions 1 and 2 of the Rugby League. My hon. Friend will recall my reference to the difference in the time scales for football and rugby.
    I stress that clubs have a responsibility to ensure the safety of the public, in the same way as the operators of any place of entertainment have that responsibility.
    Mr. Heffer: Will the Home Secretary explain to the hon. Member for Liverpool, Mossley Hill (Mr. Alton) that there is a great difference between someone unfortunately dropping a matchstick and setting a stand on fire in Bradford, and football hooliganism? Will he also explain to him that it is about time he stopped using the House of Commons for his abusive activities, as he does in relation to all subjects, rather than dealing with the issue?
    Mr. Brittan: I do not think that I should use the opportunity of such a serious question to intervene in an intra-Liverpool dispute. Although broadly I agree with what the hon. Gentleman said, there is a relationship between security and safety. It is for exactly that reason that I asked Mr. Justice Popplewell to look at both aspects of the matter. It does not take long for the House to consider the locking of exits, for example, to realise the connection.
    Mr. Eldon Griffiths: While very much welcoming what my right hon. and learned Friend has said—that it is the responsibility of football clubs to ensure the safety and security of those who go to their grounds—may I ask him to pay particular regard to the implications for police manpower of any of the changes that may be proposed? Will he also offer to the House his view on the point that football clubs might spend a little less money on the transfer of players and a little more on safety at their grounds?
    Mr. Brittan: I shall draw my hon. Friend's second point to the attention of my hon. Friend the Minister with responsibility for sport. I agree with my hon. Friend's first point. I hope that any changes that are introduced following the examination of these tragic matters will take full account of police manpower and will ease rather than add to the burdens on the police.
    Mr. Torney: Will the Home Secretary further consider the suggestion that I made in my speech immediately after the Bradford city football ground fire, that sprinkler systems should be installed in all football grounds and in all other places of a similar nature and that orders should be given that doors must not be locked while large numbers of people are inside? Does he agree that if sprinklers had been in place inside Bradford city football ground the death toll and the number of injuries would have been much lower?
    Mr. Brittan: I ought not to speculate upon the hon. Gentleman's last point. However, I agree that both of the points to which he has referred will need to be considered in the light of the findings of Mr. Justice Popplewell in his interim report.
    Mr. Tony Banks: While the designation of third and fourth division football grounds is to be welcomed, can the Home Secretary tell the House whether his colleagues are discussing the possibility of making loans available to league clubs to carry out the necessary safety improvements? If not, designation will result in the closing of a number of third and fourth division grounds.
    Mr. Brittan: I have already explained that the financing of such safety measures as have been taken or are to be taken to improve spectator safety is being considered by the working group under the chairmanship of my hon. Friend the Minister with responsibility for sport. The surveyors of the Football Grounds Improvement Trust are assessing the likely cost. Until that process has been completed it would not be sensible to make any judgments.

    Immigration Act 1971
    Dr. Mawhinneyasked the Secretary of State for the Home Department if he has any plans to repeal the Immigration Act 1971.
    Mr. Brittan: No, Sir.
    Dr. Mawhinney: I am grateful to my right hon. and learned Friend for his succinct answer. Does he agree that to repeal the Immigration Act 1971 would be disastrous both in terms of employment and community relations, not least for the members of the immigrant community? Is it not completely irresponsible of the Labour party to make such a proposal?
    Mr. Brittan: I agree with every single word of my hon. Friend. The continuation of firm but fair immigration control is crucial for race relations, as for many other aspects of our national life.
    Mr. Corbyn: Is the Home Secretary aware that serious abuses of the Immigration Act 1971 are taking place and that the procedures he has announced during the last two weeks concerning the treatment of Tamil refugees seeking asylum in this country have met with enormous opposition from Members of Parliament and from all of the immigration advisory agencies and refugee agencies? Is he further aware that the 24-hour rule for Members of Parliament, concerning the time in which they can make representations, is completely inadequate, and that until Tuesday of this week the immigration officers at Gatwick airport were unaware that they had to inform the United Kingdom immigrants advisory service of any refugee-seekers arriving in this country? Furthermore, is the Home Secretary aware that on Tuesday of this week a Tamil asylum seeker was removed extra-judicially from this country to Colombo, that his whereabouts are unknown and that it is incumbent upon the Home Secretary to tell the House what has happened to that man, why he was removed and what steps are being taken to ensure that he is returned safely to this country? An inquiry ought to be mounted into the whole affair.
    Mr. Brittan: The only point that has not been widely canvassed in the statement that I made last Monday to the House is the hon. Gentleman's last point. The particular case to which he referred was considered in great detail. We concluded that it did not meet the requirements of the United Nations' convention and that the test of severe hardship had not been met.
    Mr. Corbyn: Where is he?
    Mr. Brittan: In accordance with the administrative practice whereby the United Kingdom immigrants advisory service has been informed of cases where asylum is refused—
    Mr. Corbyn: Is he still alive?
    Mr. Brittan: —it was given the opportunity to interview the person in question and it did so, but before the results of that interview and any representations were received he was removed to Colombo. This action was the result of a serious failure in communication. I have ordered an urgent and thorough investigation both into the organisational failure and into the actions of the individual members of staff involved.
    The high commission in Colombo has been asked to contact the person in question, whose brother lives in Colombo. However, it is important to stress that I have no reason to doubt at present that the decision arrived at in his case was correct and in accordance with the policy that I announced. Nevertheless, the representations from UKIAS will be fully considered. If the judgment made in the light of that consideration is that the person in question meets the severe hardship test, contrary to the judgment that was previously formed, he will be granted a visa and returned to this country at public expense.
    Mr. Heathcoat-Amory: Does my right hon. and learned Friend agree that it is a basic right of every country to define who its citizens are and then to enforce the
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    appropriate immigration rules? Is he aware that many of the countries which criticise Britain have much more restrictive citizenship and immigration rules?
    Mr. Brittan: My hon Friend is absolutely right on both points
    Mr. Kaufman: With regard to the extraordinary admission that the Home Secretary has just made in response to a question from my hon Friend the Member for Islington, North (Mr Corbyn), can the right hon and learned Gentleman now tell the House what action is being taken to ensure that such a thing does not happen again? [Interruption ] It happened once, although the Government said that there was no danger of it happening, because the Home Secretary does not care about these matters He does not care that people may be sent back to imprisonment, torture and death, after which it is too late to put things right That is why we want an assurance that the Government will ensure that nothing like this will happen again, and that a further statement will be made to the House about it That is what we seek
    Mr. Brittan: The hon Member for Islington, North (Mr Corbyn) raised a serious point about a particular case He has been in no way assisted by the right hon Gentleman's note of hysteria I attempted to deal with that question in a serious way The position is exactly as I said it was last Monday, and I assure the right hon Gentleman and the House that the administrative practice followed since 1983, whereby UKIAS is informed of cases where asylum is refused, and is given the opportunity to make representations before anyone is returned, will be followed I have taken the strongest steps to ensure that it will be followed in all cases I should have thought that the right hon Gentleman might at least have the grace to accept that I gave a very frank and full statement to the House about what happened

    Metropolitan Police
    Mr. Norman Atkinsonasked the Secretary of State for the Home Department if he will consider the setting up of a study commission for the purpose of assessing the possibility of transferring control of the Metropolitan police to an elected body
    Mr. Brittan: No, Sir
    Mr. Atkinson: Why does the Home Secretary so tenaciously resist the demands of Londoners to democratise the accountability of the Metropolitan police9 He has authorised the expenditure of about £760 million He is now setting up consultative committees which, he says, have no right to intervene in the non-operative affairs of the London police or to interfere in policy matters so they can say nothing about that expenditure—justified or not—of £760 million
    Mr. Brittan: I do not agree with the hon Gentleman's suggestion, because nothing could be more dangerous to the liberties of this country than to hand over the police of London to political control
    Sir John Biggs-Davison: Will my right hon and learned Friend continue to uphold the constitutional independence of chief officers of police, not only in London but throughout the country?
    Mr. Brittan: Certainly The principle applies throughout the country
    Mr. Simon Hughes: If the Home Secretary is not willing to consider handing the police in London over to an elected authority, will he consider handing them over to at least a partly elected authority, in line with the discussions going on about other powers in the context of the GLC abolition Bill being considered in the other place between Ministers and Conservative peers?
    Mr. Brittan: I am not quite sure what the hon. Gentleman is alluding to, but I do not propose any changes in the arrangements for the policing of London.

    America (Ministerial Visit)
    Mr. Sackvilleasked the Secretary of State for the Home Department if he will make a statement on the visit by the Parliamentary Under-Secretary of State to the United States of America to study techniques for the prevention of drug abuse.
    Mr. Mellor: I visited the United States from 7 to 14 April. I had very useful discussions with, among others, representatives of several Federal Departments and agencies. These ranged over many issues, including the forefeiture of drug traffickers' assets, American experience of the cocaine problem and international aspects.
    Mr. Sackville: Did my hon. Friend's visit convince him that the drugs problem, particularly with cocaine, can become considerably worse here, and shows signs of doing so, and that the various radical actions that he proposes should be taken now and not delayed until it is too late?
    Mr. Mellor: Since returning from the United States, I have tried to play a full part in alerting the public to the problem of the glut of cocaine available in South America and likely to be diverted from the American to the British market. Already, a considerable response has been evident, notably in the formation of two customs teams specifically to deal with cocaine. Cocaine seizures this year are much higher than they were last year. That is a measure of success, but we intend to be diligent on this vital topic.
    Mr. Pavitt: Did the Minister examine what is happening in Florida with the treatment of misusers of drugs—cocaine in particular—who need rehabilitation? Will he discuss with the Secretary of State for Social Services the present cut in the provision of clinics for the treatment of those who, unfortunately, become addicts?
    Mr. Mellor: Far from there being a cut, there has been an increase in such facilities, brought about by the allocation of £11.5 million from the DHSS and the encouragement that my right hon. Friend has been giving to regional and district health authorities to develop these facilities. He is requiring them to send details of their proposals to the Department, and their responses will be published shortly so that the public can judge the adequacy of the response of each individual health district to this important problem.
    Miss Fookes: I urge on my hon. Friend the importance of hitting drug traffickers where it hurts—in the pocket. To that end, can we have the hope of early legislation for forfeiture of assets and for dealing with money laundering?
    Mr. Mellor: These are matters of first importance, not just to my hon. Friend, but to the Government. I assure her that we are actively considering, and reaching final conclusions on, legislation to do what she requires.
    Mr. Kilroy-Silk: How does the Minister explain the more than 400 per cent. increase in drug addiction since the Government came into office?
    Mr. Mellor: By the fact that more people are taking drugs. The problem is well known throughout the Western world. As usual, the hon. Gentleman is trying to reduce the quality of what is otherwise a non-partisan debate to make spurious political points. The increase in drug-taking straddled two Governments and will not be resolved by the petty points that the hon. Gentleman delights in making.

    Detention Centres
    Mr. Berminghamasked the Secretary of State for the Home Department if he will establish an independent inquiry into the operation of detention centres.
    Mr. Waddington: We have no plans to do so.
    Mr. Bermingham: Do not the growing number of complaints from parents, probation officers, teachers, solicitors and other people who have any connection with the inmates of detention centres, and the growing numbers of allegations of bullying and brutal treatment within those centres, mean that it is time the Government took such complaints seriously and established an inquiry to ascertain whether the short, sharp shock treatment is nothing more than a prescription for public bullying?
    Mr. Waddington: All allegations of ill-treatment are fully and properly investigated. If the allegation is of a criminal offence, it is referred to the police for investigation, and there is no need for a more wide-ranging inquiry. I gather that the hon. Gentleman made an allegation to a newspaper about Usk, but no complaints have been received there from any inmates. Therefore, it is up to the hon. Gentleman, if he has evidence—
    Mr. Bermingham: I have.
    Mr. Waddington: —of improper conduct to bring it forward.

  PRIME MINISTER

    Engagements
    Ql. Mr. Forthasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in this House I shall be having further meetings later today. This evening I will be attending a dinner given by Premier Zhao Ziyang of the People's Republic of China.
    Mr. Forth: When my right hon. Friend goes to Milan on 28–29 June for the European Council meeting, she will find that the agenda includes the Dooge report, which recommends a conference of representatives of member states to negotiate a European union treaty. Since the Dooge report says that such a conference in itself would be the initial stage of such a treaty, will my right hon.

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    Friend decline to send a representative, on the ground that there is no support in this House or in the country for further European union?
    The Prime Minister: I have often spoken about European union. The phrase is understood in this country in a totally different context from that in Europe. I wish that people would not use it. In this country it raises fear of federation. It is not used in that way in Europe. I would be absolutely against a federal Europe. I agree with my hon. Friend about a special intergovernmental conference. I think that it would be superfluous. I know that some of my colleagues in Europe would like to have it, but if we consider the European Council itself, it is an intergovernmental conference and we do not need an extra one.
    Mr. Kinnock: On Tuesday the Prime Minister told us that she wanted to be factual about the implications of the social security review. Will she now act upon that and tell us how many million householders will lose as a consequence of the changes proposed in housing benefit and, of those, how many are likely to be people with small occupational pensions who are to be penalised for a lifetime of thrift?
    The Prime Minister: The right hon. Gentleman is aware of the reply that I gave. When my right hon. Friend the Secretary of State for Social Services pointed out that the cost of housing benefit had gone up from £1.2 billion in 1979-80 to £4.2 billion this year, he indicated that we were hoping to save some £500 million from housing benefit. We cannot be more specific until the many rates are set much later.
    Mr. Kinnock: Why will the Prime Minister not answer the question? We know that she has the information. We know that the DHSS and the Cabinet have the information. The housing benefit review team said in its own paper that it was satisfied that despite all the complexities it had "a reliable indication of the major effects" of the changes being proposed. That is what we have asked for—a reliable indication. That is what the millions of people who will be affected want. Why will the Prime Minister not come clean?
    The Prime Minister: I have indicated to the right hon. Gentleman that savings of £500 million are hoped for. That is only one sixth of the increase that has occurred in housing benefit between 1979 and 1984. That seems to me eminently reasonable. The precise effect on the many people will be known when the specific rates are set, and particularly when the decisions with regard to rates are made.
    Mr. Kinnock: Does the Prime Minister know whether the number affected will be 6 million, 6·5 million, 7 million or more? Can the Prime Minister give us a figure even to the nearest half million?
    The Prime Minister: No, Mr. Speaker. I have indicated—perhaps I should reiterate it to the right hon. Gentleman — that taxpayers' expenditure — [Interruption.] The right hon. Gentleman always forgets that all the money he would give away comes from the pockets of his constituents. Taxpayers' expenditure on housing benefit has risen from £1.2 billion in 1979 to £4.2 billion—[Interruption. ]
    Mr. Speaker: Order. The Prime Minister is answering a very serious question.
    Hon. Members: No, she is not.
    Mr. Speaker: I take it that it is a serious question.
    The Prime Minister: Taxpayers' expenditure on housing benefit has risen from £1·2 billion in 1979 to £4·2 billion this year. That is an enormous increase. We hope to save something like £500 million, which is only one sixth of the increase that has occurred in our time. I say to the right hon. Gentleman that the taxpayers of this country could not afford his programmes.
    Mr. John Carlisle: Will my right hon. Friend confirm that, whatever decision is made by the United States Congress on disinvestment with South Africa, this Government will continue to encourage investment and trade with that country, not only for the 150,000 or so jobs that it generates over here, but for the sake of the underprivileged blacks in South Africa itself, for whom disinvestment would cause great harm and distress?
    The Prime Minister: I am aware of the moves in Congress. Several different Bills are under consideration. We cannot speculate on the outcome. It remains our view that sanctions and disinvestment will not bring about the changes that we all wish to see in South Africa.
    Mr. Nelson: Will my right hon. Friend comment on the decision today by FIFA to ban all English clubs from all international football matches? Does she agree that that is a wholly justified decision, which gives us a proper opportunity to put our own house in order?
    The Prime Minister: That is the decision that FIFA has made. I think that we fully understand why it has made it. I hope that we shall be able to take steps that will restore our good name both at home and in international football.
    Mr. J. Enoch Powell: Will the Prime Minister spare a moment this afternoon—I am sure that she will—to convey to her Chief Whip an expression of the delight which today's news has caused in all parts of the House?
    Hon. Members: Hear, hear.
    The Prime Minister: I thank the right hon. Gentleman most warmly, and I am grateful for the response that his question has evoked from all parts of the House.
    Mr. Terry Davisasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Davis: Was the Prime Minister consulted about the disgraceful decision to announce the Government's decision on nurses' pay by means of a written answer? Does she really think that a written answer is more appropriate than a statement in the House on a matter of such interest to hon. Members on both sides of the House?
    The Prime Minister: Since 1979 the decisions on review body reports have normally been announced by written answer. Under Labour, it was the normal practice for decisions to be announced by written answer.
    Mr. Baldry: Does not the scale of starvation in Sudan and sub-Saharan Africa demonstrate the need for a continuing, co-ordinated international response to solving the problem of starvation in Africa? As both the Uniied States and Russia have been somewhat partisan in wanting to establish spheres of influence in north Africa, does not

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    that give Britain a marvellous opportunity to take a positive lead in the United Nations to try to ensure that we can eliminate starvation from the world by the year 2000?
    The Prime Minister: As my hon. Friend is aware, we have announced that we are sending an extra Hercules to the Sudan. We have provided some money for a light aircraft. We are also taking part in European action to try to get more of the food well distributed in the Sudan. I take my hon. Friend's point about taking the lead in the United Nations. The United States has also been generous in the food that it is planning to send to the Sudan.
    Mr. Tony Banksasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Banks: Will the Prime Minister take time today to read the report by the independent firm of City accountants, Coopers and Lybrand, which shows that the transitional cost for the abolition of the Greater London council ranges between £122 million and £167 million? In view of that enormous cost and the defeats that her Government's Bill is now experiencing in the House of Lords, will she take this opportunity to drop her personal and vindictive campaign against the GLC, sack her Secretary of State for the Environment at the next reshuffle and accompany me across Westminster bridge to make her peace with Ken Livingstone and the GLC?
    The Prime Minister: I understand that the report estimates the transitional costs of change that arise from redundancy payments, which would occur in any event if the GLC chose to run its affairs efficiently. The report to which the hon. Gentleman has kindly drawn attention also shows that annual savings will flow from the abolition of the GLC and that the GLC is grossly overmanned at present.
    Mr. Eggarasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Eggar: As the hon. Member for Newham, North-West (Mr. Banks) is so concerned about the cost of the GLC, why does he not offer to abandon his chauffeur-driven limousine?
    Mr. Tony Banks: Because it is too comfortable.
    The Prime Minister: I am not responsible for the hon. Member for Newham, North-West (Mr. Banks).
    Mr. Willie W. Hamilton: Will the Prime Minister be in the House to vote against the outrageous motion that will be before the House tomorrow? If not, would she care to tell the House whether she supports her right hon. Friend and colleague the Leader of the House in that matter?
    The Prime Minister: Of course I support my right hon. Friend the Leader of the House. I shall be around, but whether I shall be around when the vote occurs I cannot tell, because I have two or three overseas visitors to see.
    Mr. Yeoasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Yeo: Is my right hon. Friend aware that anyone who knows anything about the social security system—a category of people which unfortunately does not include the Leader of the Opposition or the hon. Member for Oldham, West (Mr. Meacher) — knows that the overwhelming requirement is for a system which is simpler and more understandable to those who use it and which directs more of the expenditure to those in real need? Is she aware that, accordingly, the proposals announced by the Government on Monday have been very warmly welcomed?
    The Prime Minister: I agree with my hon. Friend that the proposals have been warmly welcomed. They are also very realistic. I agree that we should have benefits which we are satisfied a future Government can deliver, and not the empty promises that we get from the Opposition.
    Mr. Altonasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Alton: Is the Prime Minister aware that Sir John Hermon, the Chief Constable of the Royal Ulster Constabulary, has not met his opposite number, Laurence Wren, Chief of the Garda, in the past two years? Does she agree that public recriminations between the two men does not assist the fight against terrorism?
    The Prime Minister: Consultations between the Garda and the RUC do not necessarily have to be conducted at the top level. The consultations are conducted very well and co-operation is close, for which we are very grateful.
    Mr. Michael Brownasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Brown: Will my right hon. Friend take this opportunity to deny press reports suggesting that the Government may be going cool on the introduction of legislation relating to the Green Paper on compulsory tendering for local authorities?
    The Prime Minister: The Government are very anxious that more competition should be introduced into local authority contracts. That is our policy and it will continue to be so.
    Mr. James Callaghan: If the Prime Minister is in the House tomorrow, will she be able, as I hope, to vote with me against the proposed abuse of procedures?
    The Prime Minister: Many invitations have been thrust upon me from all parts of the House. I hope that I shall be around to respond to one of them.
    Mr. Andrew MacKayasked the Prime Minister if she will list her official engagements for Thursday 6 June.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. MacKay: In the light of the tragic events in Brussels last week, does my right hon. Friend agree that, with the notable exception of the Cambridge case, the punishments meted out by the courts have been woefully inadequate and no deterrent whatever to football hooliganism?
    The Prime Minister: I believe that the Cambridge case heralded a new era. I should also point out that the Court of Appeal had previously made it abundantly clear that,
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    in serious cases of violence at football grounds, the right sentence should be a prison sentence. I hope that that will be observed in all other courts.

Business of the House
3.30 pm
Mr. Neil Kinnock (Islwyn): Will the Leader of the House state the business for next week?
The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): Yes, Sir. The business for next week will be as follows:
MONDAY 10 JUNE—Opposition Day (8th Allotted day, second part). A debate on the 15th anniversary of the Royal Assent to the Chronically Sick and Disabled Persons Bill on a motion for the Adjournment of the House.
Remaining stages of the Food and Environment Protection Bill [Lords].
TUESDAY 11 JUNE—Opposition Day (14th Allotted Day). A debate titled "The need for urgent new measures to deal with famine and remedy the debt crisis in developing countries", followed by a debate titled "Government responsibility for the desperate plight of young people". Both debates will arise on Opposition motions.
Remaining stages of the Enduring Powers of Attorney Bill [Lords].
Motion on Historic Churches (Northern Ireland) Order.
WEDNESDAY 12 JUNE AND THURSDAY 13 JUNE — Debate on a motion to approve the Statement on the Defence Estimates 1985, Cmnd. 9430.
FRIDAY 14 JUNE—A debate on the Government's policy for science which will arise on a motion for the Adjournment of the House.
MONDAY 17 JUNE—A debate on a Government motion to approve the White Paper on airports policy, Cmnd. 9542.
Mr. Kinnock: The right hon. Gentleman will have heard the dissatisfaction with the fact that the nurses' pay award was announced in a written answer. Will he ensure that we have a statement at the earliest opportunity so that the Secretary of State for Social Services can be properly questioned on a matter that is important to hon. Members on both sides of the House and to the general public?
Secondly, has a date been fixed for a two-day debate in Government time on the so-called Fowler review? The right hon. Gentleman will have seen the reports in The Times and elsewhere that Whitehall sources have made it clear that it is part of the Government's tactics to keep the Opposition, the public and, presumably, Conservative Back-Bench Members in the dark about the impact of the changes. May we have his co-operation in initiating a debate so that we can lighten the darkness?
Thirdly, when may we have a statement on last week's decision of the European Court of Human Rights, which ruled that the Government have been unlawfully discriminating against husbands and male finances who wish to come to Britain? As he will recall, the Home Secretary dodged making a statement this week. Will he ensure that we get a statement next week so that the 3,350 men involved may have some idea of their future?
Fourthly, the Leader of the House will recall that we have been asking repeatedly for a debate in Government time on the proposed closure of 29 skillcentres. This week, we heard the announcement that all but two of those skillcentres will close — the two being in relatively marginal Conservative-held seats. Does the right hon.
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Gentleman accept that the issue is now even more urgent and will he ensure that hon. Members on both sides of the House are given an early opportunity to debate the matter?
Fifthly, may I draw the right hon. Gentleman's attention to the reports today of the Foreign Secretary's warning to the United States Government not to breach the 1979 strategic arms limitation treaty and so undermine the Geneva arms talks? Will the right hon. Gentleman ensure an early statement to the House on this subject, and will he remember that the Opposition have asked several times for a debate on the straegic defence initiative which is clearly of interest to the House and to the country?
Finally, will he convey, through the usual channels, of course, my best wishes and those of my right hon. and hon. Friends to the Government Chief Whip and his finance for their future happiness?
Mr. Biffen: I wholeheartedly reverse the order of the right hon. Gentleman's questions—I shall of course pass on those good wishes to my right hon. Friend the Chief Whip. I know, as does the right hon. Member for Islwyn (Mr. Kinnock) that, in doing that, I shall have the endorsement of the entire House.
As for the strategic arms limitation treaty, I shall of course draw the attention of my right hon. and learned Friend the Foreign Secretary to the right hon. Gentleman's points. It raises all of the issues that are central to a discussion of the defence Estimates.
I suggest that we might consider the request for a debate about skillcentres through the usual channels. I shall refer my right hon. and learned Friend the Home Secretary to the right hon. Gentleman's request for a statement on the recent ruling of the European Court of Human Rights as it affects the access to Britain of certain classes of immigrant.
I note the right hon. Gentleman's request for a two-day debate on the social security review. Perhaps the timing and length of that debate can be considered further through the usual channels, I was a little distressed to find that the right hon. Gentleman had to pray in aid evidence from The Times to sustain his case, but as he then asked for enlightenment I understood why he needed such remedy. Questions about nurses' pay can be examined through the usual channels, but I must observe that what has been done today is precisely what happened under the preceding Labour Government.
Mr. David Crouch (Canterbury): If the worse comes to the worst tomorrow and we find ourselves sitting through the weekend, how can I then return in happy plight that am debarred the benefit of rest? When life's—day's —oppression is not eased by night, and day by day— day by night—and night by day oppressed?
Mr. Biffen: If my hon. Friend rerehearses a little more that speech which he intends to give tomorrow, he may find by then that it is so effective that he need have no fear.
Dr. Jeremy Bray (Motherwell, South): Will the Leader of the House find time for the Secretary of State for Trade and Industry to make a statement on the encouragement which I hope he is giving the Office of Fair Trading to block the takeover of Eurolex, the computer database of English, Scottish and European law, by Butterworths, which has closed it down and dismissed all the staff to create a world monopoly for the United States-owned Lexis service for which Butterworths acts merely

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as the British agent? Is that not an outrageous demonstration of the Government's lack of any serious information technology policy?
Mr. Biffen: I cannot accept the strictures implicit in the hon. Gentleman's question, but I shall refer his request to my right hon. Friend the Secretary of State for Trade and Industry.
Mr. Jeremy Hanley: Will my right hon. Friend bear in mind the heavy demand of right hon. and hon. Members to speak in last January's debate on airports policy and therefore consider extending the debate on Monday week at least until midnight so that many more of us can congratulate the Government on yesterday's excellent statement?
Mr. Biffen: My hon. Friend advances a persuasive argument for the innovation that he seeks. The timing will be considered.
Mr. A. J. Beith: Does the right hon. Gentleman agree that the change in immigration rules which requires visas from citizens of Sri Lanka who have come to Britain as refugees raises an important principle which is quite distinct from that raised by the other immigration matter that has been raised? Will the right hon. Gentleman therefore find time for the prayer relating to the change that I have described which has been tabled by my right hon. and hon. Friends?
Mr. Biffen: I acknowledge the hon. Gentleman's point. Perhaps the matter could be considered through the usual channels.
Mr. Michael Latham (Rutland and Melton): For the third week running, may I ask my right hon. Friend to make my right hon. and learned Friend the Minister of Health an offer that we hope he cannot refuse—to make a statement to the House on an appeal system regarding the limited list of drugs? The matter is now getting very urgent.
Mr. Biffen: My hon. Friend has made his point courteously and persistently, and I shall most certainly take it up again.
Mr. J. D. Concannon (Mansfield): Will the Leader of the House impress upon the Prime Minister the need for a statement next week, after her meeting with King Hussein of Jordan and the Foreign Secretary of Israel, on their views on peace in the middle east and the role that the PLO will play as the representative of the Palestinians?
Mr. Biffen: I shall certainly pass on that request to my right hon. Friend.
Mr. Robert Adley (Christchurch): Will my right hon. Friend take the opportunity to tell my hon. Friend the Member for Richmond and Barnes (Mr. Hanley), in case he has not noticed, that the idea behind moving the sludge works at Perry Oaks is not to plant daisies? Will my right hon. Friend confirm that, if the motion on Monday week is lost, progress at Stansted could not be made? Will my right hon. Friend make that clear?
Mr. Biffen: My hon. Friend's point obviously has a great deal of force. I should have thought that it would be much better deployed in the context of the debate rather than in trying to persuade me to put a shadow over the debate by giving an answer.
Mr. Robert Kilroy-Silk (Knowsley, North): Given that those of us who have recently been in Sri Lanka have first hand and substantial evidence of brutality and the atrocities committed against the Tamil community and that many thousands of that minority community live in deep and serious fear of their physical safety and lives, may we have an early debate on the Government's inhumane and callous policy of refusing admission to refugees from that country, with all the horrendous consequences for their personal safety that flow from that policy?
Mr. Biffen: I realise that this subject gives rise to deep and sincere feelings. I shall report them to my right hon. and learned Friend the Home Secretary, but I cannot be optimistic and suggest that there will be an early debate.
Mr. John Stokes: Does my right hon. Friend agree that the lack of religious and moral teaching, discipline and, above all, parental responsibility are the main causes of so much of the violence in our society? Cannot we discuss these important and vital matters?
Mr. Biffen: I totally agree with my hon. Friend, but Government time will not be available for such a debate —certainly not in the near future. Hon. Members have other opportunities, and I suggest that they pursue them.
Mr. James Molyneaux (Lagan Valley): Will the right hon. Gentleman give sympathetic consideration to our request for a one-hour extension of the debate on Tuesday on the Northern Ireland order?
Mr. Biffen: Most certainly. Perhaps that matter could be considered through the usual channels.
Mr. David Harris (St. Ives): The House gave an overwhelming Second Reading to the Bill introduced by the right hon. Member for South Down (Mr. Powell), but, despite that, many of us who voted in support of the Bill have distinct reservations about the tactics that will, apparently, be employed tomorrow. Will my right hon. Friend reconsider his previous position on this matter and, even at this late hour, give an undertaking that Government time will be made available so that this important measure is given the proper consideration that it deserves?
Mr. Biffen: I am grateful to my hon. Friend for that question, which certainly was not planted. I want to make it quite clear— I want there to be no ambiguity about this — that there is no prospect of Government time being made available.
Mr. Willie W. Hamilton (Fife, Central). What contingency plans has the right hon. Gentleman made for the House sitting on Saturday and Sunday? If this happens, will the right hon. Gentleman make arrangements to ensure that those responsible will be surcharged?
Mr. Biffen: In order to give the most appropriate answer to that question, I would need more time for reflection than is available to me at the Dispatch Box.
Mr. Patrick Cormack (Staffordshire, South): As my right hon. Friend is a master not only of repartee but of parliamentary procedure, will he make it plain that what is contemplated and proposed by some of our colleagues for tomorrow is entirely proper and is not an abuse of the procedures of the House?
Mr. Biffen: It is far better if these arguments are adduced within the more relaxed circumstances of the

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debate than in question and answer at this time. I can confirm that there seems to be clear evidence that the proposed action has been ruled to be in order.
Mr. Nicholas Brown (Newcastle upon Tyne, East): In view of the announcement at about lunch time today by Imperial Tobacco plc that it intends to close its factory in east Newcastle with a loss of 600 jobs and that, in addition it intends to sack 1,100 people during the next two years, will the right hon. Gentleman find time for a discussion on the employment problems faced by constituencies that rely upon the tobacco industry for employment?
Mr. Biffen: I shall, of course, draw the matter to the attention of my right hon. Friend the Secretary of State for Employment, but the hon. Gentleman may recall that employment questions will be dealt with next Tuesday.
Mr. Robert McCrindle (Brentwood and Ongar): Reverting to the debate on airports policy on Monday week, may we know the basis upon which it is to take place? If it is simply to take note of the White Paper and the House refuses so to do, will that mean that the Secretary of State for Transport will have to re-think the policy that he announced in the House yesterday?
Mr. Biffen: I have already indicated that the motion on Monday 17 June will be a Government motion to approve the White Paper.
Mr. James Lamond: Has the Leader of the House noticed that on several occasions recently the Secretary of State for the appropriate Department has not appeared at the Dispatch Box at Question Time? The latest example was on Tuesday of this week, when the Secretary of State for Defence was unable to be present because apparently he was on an official visit to Denmark.
Bearing in mind that Secretaries of State are required to be here for questions on only one day in a month, is it not possible for them to arrange their official visits so that they are not prevented from being here to answer questions?
Mr. Biffen: Obviously I would be the first to acquiesce in the proposition that it is important that Secretaries of State should, whenever possible, be here at the Dispatch Box to take their questions. I believe that that view is shared throughout the Administration. But there are occasions when it is not possible, and I think we have to understand that.
Mr. Ivor Stanbrook (Orpington): Does my right hon. Friend intend to speak tomorrow in the capacity that he recently described as "the boss's nark", or does he agree that Back Benchers are just as much entitled to use rules of order and procedure, without accusations of abuse, as are the Government who they are supposed to control?
Mr. Biffen: I shall speak as Leader of the House, and I shall try to tread as delicately as I can.
Mr. Dafydd Wigley (Caernarfon): If tomorrow's business ran through not only Saturday and Sunday but into Monday, will the Leader of the House confirm that, under the Standing Orders of the House, business could be adjourned after Monday till the following Monday? In those circumstances, does he intend to table a motion to avoid that eventuality?
Mr. Biffen: I do not think that we have quite got to the point where I have to take that decision.
Mr. Bowen Wells (Hertford and Stortford): Will my right hon. Friend take pity on Mr. Speaker and help him in relation to the debate on airports policy? There has not been adequate time, at any Question Time when the matter could be raised, for all of us to be heard. In particular, those who represent the area most affected by the decision, east Hertfordshire and Essex, have not had adequate time because, quite rightly, Mr. Speaker, has had to give time to hon. Members from other parts of the country with an interest in the matter.
My constituents are feeling very aggrieved that we have not had adequate time to point out to the House and to the country the very serious difficulties in which the decision places us. Therefore, will my right hon. Friend at least consider extending the debate by two hours?
Mr. Biffen: The request for an extension has already been made to me, and it will be sympathetically considered.
Mr. Tam Dalyell (Linlithgow): In answering my hon. Friend the Member for Motherwell, South (Dr. Bray), the Leader of the House was his usual model of courtesy, but has he really understood the enormity of what has happened in relation to Butterworths and Eurolex? The computer data are going to the United States. Should not he, directly or through the Department of Trade, contact the Office of Fair Trading? Although only 53 jobs are involved at present, there is a huge potential job loss. Incidentally, Parliament is a major customer, and it looks as though Parliament's expenses in regard to Eurolex will be greatly increased by what has happened.
May I offer the Leader of the House a constructive suggestion? May I suggest that he should get the Minister for Trade to make a statement at 11 am tomorrow on the vital matter that my hon. Friend has raised?
Mr. Biffen: There is just a suspicion that having such a statement at 11 am tomorrow would be seen as trivialising the matter. There would be a possibility of its being misinterpreted. I shall, of course, convey to my right hon. Friend the anxieties of the hon. Members for Motherwell, South (Dr. Bray) and Linlithgow (Mr. Dalyell).
Mr. Gary Waller: Has my right hon. Friend taken note of early-day motion 714 concerning a Yorkshire Post investigation into drug abuse?
[That this House is concerned at the new evidence in Yorkshire of illegal drug trafficking and the involvement of young people in hard drug abuse; congratulates the Yorkshire Post on its detailed investigation into this urgent and serious problem; notes that the Select Committees on Home Affairs and on Social Services are undertaking enquiries into drug abuse; and calls for an early Parliamentary debate on their proposals further to inhibit supply and to rehabilitate addicts.]
In view of the serious facts revealed by that investigation and the fact that this is one of the most significant issues of our time, will he arrange an early and full-length debate on the interim report of the Home Office Select Committee on the subject?
Mr. Biffen: I join my hon. Friend in acknowledging the importance of the topic. He will note, however, that no Government time has been made available for a debate

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on the issue in the business that has been announced, and I do not see there being time available in the near future now that we are in that part of the parliamentary year just ahead of the summer recess. However, my hon. Friend will be aware that he can pursue these matters through private Members' time.
Mr. Tom Clarke: In view of the decision by the House of Representatives in the United States in relation to South Africa and the exchanges today during Prime Minister's Question Time, does the Leader of the House agree that we should have an early opportunity to debate this issue?
Mr. Biffen: I have no doubt that it would be a good debate, but there is no Government time available in the near future.
Mr. Peter Bruinvels: Has my right hon. Friend seen early-day motion 708, which stands in my name and the names of 20 other hon. Members, giving all-party support for the establishment of a missing child unit within the Home Office?
[That this House welcomes the designation of Saturday 25th May as International Day of the Missing Child; and calls on Her Majesty's Government to establish a missing child unit within the Home Office with a central computer detailing all missing children throughout the United Kingdom, and not just within the Metropolitan Police area.]
Is he aware that great concern is felt about the fact that last year more than 20,000 children went missing, yet inadequate, if any, statistics are kept about these cases? On the subject of children, I hope that my right hon. Friend will not take it personally when tomorrow more than 100 hon. Members in all parts of the House express their concern for the unborn child and do not support his objection to our motion. May I respectfully remind him that most hon. Members feel that tomorrow is a private Members' day and regret that any form of Government interference, even if indirectly, should occur?
Mr. Biffen: I note my hon. Friend's remarks in relation to tomorrow's debate. I also appreciate the significance of the first part of his question and hope that he will use his well known skill and initiative as a private Member in getting the issue debated. There simply is not Government time to cover all these issues.
Mr. Dave Nellist: Has the Leader of the House seen the statistics released by the Department of Employment to me this week showing that for this year's 517,000 school leavers there exist only 12,355 vacancies at careers offices? Is he aware that 56 per cent. of careers offices in Britain have 10 or fewer vacancies; that in Scotland the figure is 94 per cent.; that in Wales, only two careers offices have more than 10 vacancies; and that 95 per cent. of careers offices have fewer than 10 vacancies? When in Government time will there be a debate on the bleak and dismal future that the Tory Government are offering this year's school leavers?
Mr. Biffen: I hope that the hon. Gentleman does not regard Opposition time as second best, because on Tuesday there will be a debate on the subject of young people and I hope that he will be able to make a speech on that occasion.
Mr. Andrew Faulds: Has the right hon. Gentleman been made aware during his especially busy
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day today that the Arts Council held an emergency press conference this morning at which it announced that there would be a £30 million shortfall in the moneys needed to support the arts following the Government's messing about with the GLC and metropolitan counties? What do the Government intend to do to provide that necessary funding of £30 million?
Mr. Biffen: I do not think that there will be a statement on that subject next week, but I shall draw to the attention of the Parliamentary Under-Secretary of State for the Environment, who answers for the arts in the House, the situation described by the hon. Gentleman.
Mr. Laurie Pavitt (Brent, South): You, Mr. Speaker, and the Leader of the House will be aware of the great interest that I have expressed over the years, both in the House and in Committee upstairs, in the National Health Service. Is the right hon. Gentleman aware of the need for a statement to be made next week on the question of nurses' pay? We shall not have time to table questions before the Minister for Health next answers questions in the House on Tuesday. After that, there will be only one further occasion when health questions will be answered before the summer recess.
The issue affects half a million nurses and midwives and yet the announcement is to be made in a written answer which I shall not be able to see until tomorrow morning. Will the right hon. Gentleman please do something for Back-Bench Members on this important matter?
Mr. Biffen: The Leader of the Opposition made a request about the way in which the matter should be handled and I said that it could be considered through the usual channels. I cannot go beyond that. However, the procedure this year is precisely the same as it has been for many years.
Mr. D. N. Campbell-Savours: Why do the Government persist in refusing to make a statement at the Dispatch Box on the loss of the Lear Fan company in Ulster? Why do they persist in replying only in written answers? What are they trying to hide? As a vast amount of public money is involved, should not the Minister be made accountable to the House by making a statement on which we can question him?
Mr. Biffen: I shall refer those remarks to my right hon. Friend the Secretary of State for Northern Ireland. Questions about Northern Ireland are first on the Order Paper next Thursday.
Mr. Greville Janner: In view of the persistent and regrettable failure of courts, and especially of tribunals, to take properly into account the statutory codes set by the Commission for Racial Equality and the Equal Opportunities Commission, and of the exclusion from the protection of the law of single people, including widows and widowers, when can we have a debate in Government time on equal opportunities? Is the Leader of the House aware that inequality in many respects is growing in Britain?
Mr. Biffen: I see little prospect in the near future of such a debate in Government time because Government time is a rare and valued commodity at this time of year. The hon. and learned Gentleman has other opportunities to raise such matters in the House.

Opposition Day
[13TH ALLOTTED DAY]—considered
Opposition Day

  Elderly Persons
  4 32 pm
  Mr.David Steel(Tweeddale, Ettrick and Lauderdale): I beg to move,
  That this House, while recognising the need for a review of the social security system, rejects those parts of the Green Paper which are designed to cut costs and will therefore add greatly to the problems of many elderly people on low incomes by reducing their entitlement to help with the high cost of rent and rates, will eventually remove the state earnings-related pension scheme without substantially increasing the basic pension, and will replace a parsimonious death grant scheme with one likely to cause maximum distress at the time of bereavement.
  Mr. Speaker: I have selected the amendment in the name of the Prime Minister.
  Mr. Steel: As this is the first occasion on which the amended Standing Order No. 6 has been brought into use, and the minority parties have a chance to introduce a debate out of slightly more generous time than in the past, it would be churlish to let this opportunity go by without thanking the Leader of the House for enabling this reiorm to be made Needless to say, we are not satisfied that we are being given a fair deal, but this is a notable step forward, with the existence of something other than the official Opposition at last being recognised in the Standing Orders.
  I am pleased that my colleagues and I took the decision that our first use of this opportunity should be to have a debate on the problems of the elderly. We took that decision before the Whitsun recess knowing that the Green Paper on social security reform would be published before the debate Although the debate is not to be confined to that Green Paper, it provides the House with an early opportunity to probe the Government further on their intentions in that review.
  Bevendge once observed that if one scratched a Tory one would find a pessimist, and if one scratched a Liberal one would find an optimist If one scratched the Green Paper one would find acute pessimism Where it is not pessimistic, it is mean-minded The pessimism is contained in the assumptions set out in paragraph 5·6 of volume 1, which looks at the costs of our pension provisions over the next 20 years. It does so on assumptions of 6·5 to 10 per cent. continuing unemployment, so that the greatest extent of the Government's optimism for the next 20 years is an unemployment level of 6·5 per cent. That is a great contrast with Bevendge's original concept of working out a social security scheme, based on assumptions of reasonably full employment.
  The Government's basic assumption is dumbfounding Week in, week out, we hear of how economic recovery is about to arrive next week, next month or next year, and that the economic miracle has been achieved. Such ohrases trip off the tongues of Mimsters at weekend speeches, but, when it comes down to the hard facts, the basic assumption throughout the review is of an intolerable level of unemployment in the years to come.

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  We are entitled to ask on what growth assumptions in the economy the review is based. Again, pessimism seems to be the order of the day. The only figures that one can find in the review are the page and paragraph numbers.
  The first question that I put to the Minister for Social Security is: what is it that you have to hide? Without the figures, as the Financial Times commented, it is rather like having an annual report without a profit and loss account. The figures should be given to the House soon, for three reasons. First, no Government or Parliament can contemplate recommending a series of changes to our basic welfare provisions without a pretty good idea of how they will affect those who rely on the welfare state. On Tuesday, the Prime Minister, in answer to questions, said that her refusal to give figures was because of her belief in sound finance. That must be an exotic statement, even by her standards.
  The second reason why there have to be figures is that the Secretary of State said, back in April 1984, that the review was to be revenue neutral. How can we tell if that is so without costing? How can we tell if the reforms will save the £1 billion that the Chancellor wants to save without costings?
  The third reason why the Government should give the House some figures is that in the housing benefit review section of the report, paragraph 3·19 refers to the illustrative costings for that section. However, they have not been given. They have been leaked in various places, but not here.
  While we all welcome the review, the Government have been less than candid, and their failure to publish figures has spread unnecessary fear among claimants, especially pensioners, and this has been done because of media management. However, on the basis of what the report says, we can already identify three sectors in which pensioners will be hard hit—housing benefit, SERPS and the death grant.
  Mr. Eric S. Heffer: I endorse what the right hon. Gentleman says, but he spoke of unnecessary fears. Surely these are necessary fears.
  Mr. Steel: That is a play on words, but I accept the hon. Gentleman's point. It is a fear that I fear will turn out to be necessary. However, if we are right in some of the calculations that I shall give, it would be better for the Government to give the figures now so that the population can thoroughly debate the Green Paper.
  It has been calculated outside the House that on housing benefit over 6 million people will lose more than £1.40 per week. Is that calculation correct? The Government are in a position to tell us. Before we look at what is proposed on housing benefit, we should do well to remind ourselves of what has already happened to housing benefit in the lifetime of the Government.
  In the 1983 Budget, housing benefit was introduced to unify the two existing schemes, but, because the reform was supposedly conducted without costs, many people lost out during the original introduction of the housing benefit scheme. It has had two further cuts, in April and November 1984. Thus we are arriving at the review against a background of at least three previous occasions in the lifetime of this Government when housing financial
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  support for certain people has been cut The total cut may be about £500 million Again, the Government are the only people who can tell us whether that figure is right.
  I move on to the detail of what is proposed on housing First, there is the question, on which we were quizzing the Prime Minister on Tuesday, of the 20 per cent rate demand as a minimum payment from everybody in the future I asked the Government about that, because it is not clear whether it is intended that people receiving the new income support help with these payments will be subject to the 20 per cent or not That is not clear from my reading of the report.
  In principle, it is a good idea to cut the number of individual tapers and the rates at which benefit is withdrawn against them, but the Government's proposal for a single taper for rent and rates will hit pensioners particularly hard I can give a specific case as an example It concerns a pensioner couple who have paid off their mortgage and have an income of £75 a week, which is hardly living in the lap of luxury On realistic assumptions, they will lose out substantially, if my calculations are correct Let us assume a weekly rates bill of £9—a not excessive figure for London At present, the couple will receive £4·71 housing benefit Assuming an income support level of £61, which is the current supplementary benefit level, plus a few additions to which pensioners are entitled, their entitlement under the new, combined 70 per cent taper will be negatived—minus 80p They will lose all benefit entitlement, and there will be the imposition of the 20 per cent rates provision The basic point is that those who pay no rent, who are mainly pensioner owner-occupiers, will be very severely hit by the new proposals in the Green Paper I should like the Minister to confirm that
  At present, people on supplementary benefit receive help to pay their water rates, but under these proposals, as I understand it, they will receive only about £1 per week That will prove inadequate, especially against the background of the Government telling water authorities to push up their charges The Green Paper proposal will hit pensioners severely Many elderly pople will see their basic weekly standard of living drop substantially as a result of the review.
  In regard to the state earnings-related pension scheme, we on these Benches will not be able to support its abolition without a correspondingly large increase in the basic pension All the pensioner organisations that I have met in recent months — Age Concern, Pensioners' Voice, and so on—say that, while they welcome the individual provisions made for pensioners, they would really like a substantial increase in their basic standard of living We have always supported that During the passage of the legislation my noble Friend Lord Banks in another place and my hon Fnend the Member for Truro (Mr Penhaligon), who was our spokesman in this House at the time, made it clear that we reckoned that SERPS would turn out to be too expensive We said we would rather put the money on the basic rate and encourage the growth of occupational pension schemes The Government have never been generous to pensioners in the basic rate.
  We must examine the Green Paper against the background of what has happened m recent years The breaking of the link between earnings and pensions in 1979 has cost a couple £4·85 and a single pensioner £3 per week It is also a way of saying that pensioners should not share

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  automatically in any general growth in the nation's prosperity which, as I shall show in a moment, runs counter to some phrases in the Green Paper.
  The effect that the proposals will have on the value of the basic pension is not clear. Paragraph 9·4 of volume 1 suggests that there is to be a reallocation of support towards families with children. The Minister also said that in his statement. It follows that, if the review is to be neutral overall, the people who will lose out will be not families with children, but again mainly pensioners.
  Paragraph 7·19 of volume 1 refers to the abolition of SERPS enabling the Government,
  "if economic growth permits, to give all the pensioners of the time a share of increasing prosperity through the basic pension."
  If we were to put that in jargon terms, it means that the Government's policy is possible jam for the day after tomorrow. That is the only interpretation to put on it. In other words, pensioners will have to wait for a general uplift in the economy, which the Government's own assumption through the 20-year forecast denies will happen, before they can achieve a higher standard of living.
  In volume 2, paragraph 1·69 says that the earnings rule, which the Government have been promising to end since 1979, will be ended
  "at the earliest opportunity when resources permit".
  That is the same message of possible jam the day after tomorrow. What is the Government's long-term intention about the basic pension? We should know before further debate on the Green Paper.
  Of all the proposals in the copious volumes of the review, the proposal in regard to the death grant is the meanest. We would face the same problem if we were in government. I well understand that a flat rate grant of £30 that is long out of date cannot be increased suddenly to bring it in today's terms to the level at which it was introduced, because the public expenditure commitment would be enormous.
  The Government's proposal is doubly vicious. The individual seeking help for a funeral will have to go to the DHSS to ask for a discretionary payment at a time of maximum grief and bereavement. Moreover, the decision will have to be made quickly, by definition, because of the funeral that is being booked to take place within a dew days. Those are the worst possible conditions in which to have a general discussion of a means-tested benefit.
  On top of that I understand that help for funerals is to come out of the new social fund, on which there will be a limit. What will happen towards the end of a financial year if after the money has run out someone asks for help to pay for a funeral? There has been no explanation of how the social fund will operate in general on a fixed sum. In particular, how will it operate if people are inconvenient enough to die towards the end of a financial year? The Government should come clean on that.
  I have a positive suggestion. The only reasonable course is to uprate the death grant to a substantial amount — probably £250 — and to say that it is available automatically for those who wish to claim it, but that the Government may claw it back from the estate in due course, after the funeral is over and the bereavement has passed. That would ensure that the money would not go to those who do not need it. I do not know why the Government have not come up with such a scheme.
  I have said enough about the Green Paper. There are three other matters that I wish to raise under the heading
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  of the elderly. Many hon. Members are concerned about the tax provisions that we make for those who devote their lives to caring for the elderly. This is surely one of the developing areas of support for the elderly. The network of informal community care throughout the country is massive, but it is often ignored and not greatly encouraged by public authorities.
  It was estimated from the 1981 census that about 800,000 people are involved in caring for the handicapped elderly. If we add to that other categories of elderly, who need extensive care but receive it through the informal sector—families, neighbours, and so on—the reasonable figure for informal carers would be able about 1 million. If the work of these people has been done by the state and if, on a modest asssumption, we take three and a half hours a day at £2·90 per hour, the average cost of home helps in the financial year 1982–83 would have been a massive £3·5 billion. Therefore, as a community, we should recognise that these informal carers are extremely important because they do a good job at very low cost. Instead of taking them for granted, we need to formulate policies to support them and recognise the selfless contribution that they make.
  The first thing to be done is to extend the improperly named invalid care allowance to married women. At the moment it is discriminatory in that it is paid only to men and women who are not dependent on a breadwinner. I understand that there is before the European Court a case that the Government are likely to lose. It would be more useful and sensible for the Government to give in gracefully and agree that the allowance should be extended to married women. Help should also be provided to enable the carers to have one or two weeks' holiday by bringing someone else in to look after the elderly relative. That would give these people a break from the work they have to do.
  One consequence of the Government's cutback on spending by local authorities has been the reduction in the personal social services. The people who have suffered most have been the elderly, through the meals-on-wheels and home help schemes. Those are the things which directors of social services find relatively easy to cut from their budgets when they are hard pressed. I am told that between 1979 and 1984 two thirds of local authorities had increased spending by less than the Association of Directors of Social Services regarded as necessary to maintain, not to improve, these basic services. Rate-capping will make the problem even worse. Too often the Government have tried to shift the blame for the reduction in personal social services on to the local authorities. We should make it clear in the House that we regard the Government as directly responsible for these cutbacks.
  The elderly who live in rural areas—although I am not speaking exclusively about rural areas — are dependent on the transport provisions that we make for access to post offices, and so on. I believe that the Transport Bill, which is at present going through another place, will damage the interests of elderly people by making it more difficult for local authorities to provide the schemes necessary for effective support of transport for elderly people. For example, I believe that the cross-subsidy will be down from about £60 million to £20 million a year, and in any case it is designed to be phased out within five years.
  Mrs. Elaine Kellett-Bowman: Does the right hon. Gentleman accept that in my part of the country the elderly, and particularly the disabled, will be substantially helped by the Bill? Although many of them receive concessionary fares, they cannot make use of them either because there are no buses or because they are too disabled to board them. Under the new Bill, they will be able to use their coupons for taxis, and that will help enormously.
  Mr. Steel: The hon. Lady is half right; but to say that because there are no buses in some areas we should introduce legislation that will mean even fewer buses in the future is to express a most extraordinary view. I think that the hon. Lady will join common cause with me in this view. I find that the various concessionary fare schemes suffer through lack of a national scheme of support which would enable elderly people to travel across boundaries between rail and buses. Old-age pensioners in my constituency, which is hard hit by that, have complained to me that in other parts of the country, notably in the London Transport area, pensioners have benefited greatly in past years from imaginative local schemes that have no cross-geographical reference. We know from the experience of British Rail, which found it convenient to introduce off-peak travel schemes for old people, that it is possible for a national scheme to be introduced.
  I referred earlier to post offices. In rural areas people have to travel further because of the cutbacks and closures that are taking place. The combined effect of post office closures and the lack of transport facilities will adversely affect elderly people in rural communities.
  In conclusion, it is important that we turn our attention, in the wake of the publication of the Green Paper, to the plight of the elderly in our communities. We should insist that during the debate in the weeks ahead the Government are more forthcoming about what is actually going to happen, so that at least, in the words of the hon. Member for Liverpool, Walton (Mr. Heffer), people know the worst and are not left with the vague, unfigured, unstructured debate into which they have been plunged by the publication of the Green Paper.
  4.52 pm
  The Minister for Social Security (Mr. Tony Newton): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
  "recognises the Government's achievement in increasing the value of the retirement pension and welcomes the Government's continued commitment to protect its value; congratulates the Government on carrying out a thorough review of the social security system; and endorses the aim of ensuring a coherent and soundly based benefit structure to meet the needs of pensioners and others.",
  We welcome very much the opportunity for this debate, at an early stage, on the needs of elderly people and their relationship with the proposals that we have put forward in the social security review Green Paper. As a Government, we have shown by our actions that meeting the needs of elderly people is a major objective of our policies, whether in social security, social services, health, or the many other aspects of policy that affect people in retirement.
  The Government's amendment begins by referring to what has been achieved. Especially against the background of what I took to be the rather grudging remarks of the right hon. Member for Tweeddale, Ettrick
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  and Lauderdale (Mr Steel), I want simply to remind the House of what has been achieved in the past five or six years First and foremost, we have firmly and clearly not only fulfilled but more than fulfilled our pledge to protect the value of retirement pensions They have risen by very nearly 84 per cent in a period in which prices have risen by 77 per cent —a clear real increase What is more, that has been achieved at a time when the number of retirement pensioners has increased by some 700,000, so that we have protected the position not only of those pensioners whom, as it were, we inherited, but of the significantly larger number of pensioners arising from demographic factors in the past few years Contrary to what many Opposition Members profess to believe, it is our achievement in providing for that additional number of pensioners and increasing the real value of benefits that accounts for the major part of the real increase in social security expenditure of over £8 billion that has taken place in the past five or six years
  At the same time, we have changed the method of uprating pensions so that pensioners have the assurance of increases based on the actual measured increase in prices instead of the vagaries and uncertainties of the forecast method that we inherited from the Labour Government Not least, for pensioners generally, we have written the Christmas bonus into the law and prevented the recurrence of what happened twice under our predecessors when the Christmas bonus was not paid at all But if those are our achievements on the broad front—
  Mrs. Margaret Beckett: As the Minister is talking about how good the Government's record is on the Christmas bonus, would he like to refer to the commitment that I seem to recall the Conservatives making before 1979 to double the Christmas bonus? Will the Government actually do that?
  Mr. Newton: I am unaware of any commitment that we made to double the Christmas bonus Such challenges come oddly from an hon Lady who was, as I recall, a member of the Administration at the time when, two years running, no Christmas bonus at all was paid My answer to the hon Lady, if I may lapse into the vernacular, is simply what a nerve.
  Let me turn from what I said about the generality of our achievements for pensioners to some of the more limited measures that we have taken, which I think have been recognised by some Opposition Members, not least the hon Member for Birkenhead (Mr Field) They have not been recognised as widely as they should be Although they are not necessarily of benefit to pensioners generally, they have brought significant additional help to important groups of pensioners with particular needs.
  For example, I remind the House that since May 1983 men over 60 who are sick, disabled or unemployed can qualify immediately for the higher long-term rate of supplementary benefit Men over 60 who are not working no longer need to sign on as unemployed to be awarded national insurance credits Let me remind the House also that the capital limit for supplementary benefit was raised to £3,000 in November 1983, and changes have also been made in the smaller capital limit for single payments—a significant additional help to those many pensioners who have modest savings and previously found themselves denied benefit.
  Let me remind the House further that since November 1984 people who return to this country after the age of 70

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  have been able to qualify for the non-contributory over-80s retirement pension. Before that change was made they had to fulfil a 10-year residence test before their 80th birthday. At the moment before the other place is a Bill that provides for abolishing the married women's half test, with effect from December 1984, so that married women who were over 60 in April 1979 will be able to get any retirement pension earned by their own contributions even if they did not pay national insurance contributions for half their married life. That was a discriminatory measure, and we have been happy to propose that the House should remove it. In recent proposals brought by the Government to the House, we have made it clear that we intend to abolish the lower married women's rate of the over-80s pension, and pay everyone the full rate from November 1985.
  Those are not proposals that affect every pensioner, but they are targeted on groups with particular needs, for which I think we are entitled to claim credit from the House and, indeed, from the country.
  Perhaps most important of all is a point which the right hon. Member for Tweeddale, Ettrick and Lauderdale did not touch upon and which I do not expect to hear mentioned by the Opposition Front Bench. I refer to the Government's most important single achievement in relation to retirement pensions, which has nothing to do with the pension itself. Our achievement in dramatically reducing the rate of inflation has ensured that pensioners' benefits and savings reasonably maintain their value and purchasing power.
  The air of scorn of some Members on the Opposition Front Bench does them very little credit. They should go out into the country and ask pensioners how they feel about the Government's achievements in reducing inflation and how much easier that makes their lives than they were when prices were rising at more than 20 per cent. per annum. The Opposition should talk to the grass roots.
  Mr. Frank Field: I do not wish to cramp the Minister's style, but will he spend some time not just reviewing what he alleges to be the Government's achievements but telling the House what the Government intend to do? As a result of the "new Beveridge" that the Secretary of State has brought forward, how many pensioners will be better off and how many millions will be worse off?
  Mr. Newton: I was about to come to the figures and the Green Paper, but lest the hon. Gentleman think that I am trying to fend him off I should say that the Government are proposing an important series of structural reforms.
  The hon. Gentleman is one of the few people in the House who may already have appreciated the significance of adopting for income-related benefits a common base of income assessment and a co-ordinated set of rules, and its importance for rational social security planning and the use of resources throughout the country. The Government feel that it is right to concentrate first on those structural reforms because whatever resources are available in the social security system it will be impossible to ensure that they are effectively used if we do not have a structure capable of using them effectively. When the House has had an opportunity to come forward with proposals concerning this structure and the Government have produced final proposals, then will be the time to consider in detail how the resources should be applied within that structure. That is what will determine the figures which so interest the hon. Gentleman.
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  Within any structure, decisions have to be made from time to time about the level of resources. It would not be sensible to give the kind of figures requested by the hon. Gentleman in advance of the structure being settled. Only the figures for the actual benefit rates from April 1987 will properly allow the hon. Gentleman to make such calculations. It is sensible to get the structure right and then to decide what the resources are to be and how they are to be deployed within the structure.
  Mr. Field: Did the Government follow that procedure when they discussed the reforms in private? Is the Minister saying that the proposals were approved by the Department, the Cabinet Committee and the Cabinet itself without the Secretary of State putting any figures to them at all? Was the Cabinet happy to see at some later stage how individual groups would be affected? If the Cabinet was not satisfied with a discussion on that basis, why should the House be satisfied now?
  Mr. Newton: In the course of the social security review the Government have, of course, satisfied themselves that the structure proposed can be sustained at a cost that the country can afford.
  Mr. Field rose—
  Mr. Newton: I shall give way again in a moment. The hon. Gentleman might at least let me finish my answer to his general point.
  The point that the hon. Gentleman has failed so far to take—and I should like to carry him with me on this— is that whether we have the proposed structure, the present structure or any other structure that people come up with, decisions have to be taken year by year about the resources to be applied within the social security system. That cannot escape any Government, and the Labour Government many times found themselves taking what they no doubt regarded as very difficult decisions for just those reasons.
  Given that within any structure Governments have to take decisions about resources, and as it would plainly be absurd at this stage to try to settle benefit rates for April 1987, the important issue for the Government to put before the House and for the House and the country to consider is whether we are proposing a sensible structure within which the resources, whatever their level, can be sensibly deployed.
  Mr. Field: Most of my constituents would be far happier with a scheme that is complicated and difficult to understand but which pays more money than with a Rolls-Royce scheme which pays only half the benefits, and I shall be happy to take that debate to the country. Is the Minister really saying that the Prime Minister approved the scheme without knowing how many millions of pensioners would be better or worse off?
  Mr. Newton: I have already given my answer to the general question that the hon. Gentleman raised. As one or two of my hon. Friends have pointed out from a sedentary position, although I have the highest regard for the moderation with which the hon. Gentleman put his views in the House and for his knowledge of the social security system—which is greater than that of most of us — the views that he attributes to his constituents, whether accurately or not, are not views that I would expect him to endorse. If the hon. Gentleman, as one of the leading experts in the House on the social security

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  system, is saying that he is interested only in additional resources regardless of whether the system is capable of directing them effectively to people in need, frankly he does nothing but damage to his own credibility.
  Mrs. Beckett rose—
  Mr. Newton: I will give way this time, but much as I am enjoying the debate I shall have to resist the temptation to give way any more because many other Members wish to take part.
  Mrs. Beckett: The Minister has said some very kind words about my hon. Friend the Member for Birkenhead (Mr. Field), but he does his own reputation no good by trying to sustain the argument that the amount of money that people receive matters less than the way in which the money is delivered. If he. really believes that, his understanding of the social security system and those who draw on it is infinitely less than we had previously imagined. Is what the Minister has just said a statement of what the Government are offering — a streamlined system with less money? If so, that merely confirms our worst fears.
  Mr. Newton: I had intended to respond with almost as many kind remarks about the hon. Lady as about her hon. Friend, but in the past 30 seconds or so she has forfeited the right to those kind words.
  Mr. Field: Just answer the question.
  Mr. Newton: Not only did I in no way suggest that the structure was more important to claimants or anyone else than the level of benefits, but I made it quite clear—I hope that I carry both hon. Members with me on this— that a social security system which is not capable of using any given quantity of resources to the best effect, targeted effectively on those in greatest need and with the greatest claim to support from the rest of the community, is not a satisfactory system. What is more, such a system would end up wasting some of whatever money was put into it.
  Mrs. Kellett-Bowman: Will the Minister accept that the elderly have a strongly developed sense of fair play? If they can see exactly how they and others benefit from the social security structure, they will be very much happier than they are with the present complicated system.
  Mr. Newton: I entirely accept that helpful intervention from my hon. Friend.
  I should like to move from the Government's record, as indeed I was being urged to do by the hon. Member for Birkenhead, to the way in which the concern shown in that record is carried through into the objectives and proposals in the review.
  It is significant that the inquiry into provision for retirement was the first of the reviews to be established. Our aim is to ensure a sound basis of social security on which pensioners can safely rely. Briefly, I shall set out the main review proposals.
  First, the basic state pension remains the foundation of state provision. To use the phrase in the Green Paper, it is one of the twin pillars of our approach to social security and a vital part of the improved partnership between the state and the individual that were are creating. The Green Paper states:
  "The Government remain entirely committed to this"—
  the basic retirement pension—
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  "and will continue to ensure that it retains its value".
  Pensioners, with other social security beneficiaries, will have two upratings in the 16 months from November 1985 to April 1987 This will be carried out on the historic basis, taking the latest practicable measure, so that each uprating will be on time
  On top of the assurance given on the basic retirement pension, we have made it clear that the rights of existing pensioners or anyone retiring before the end of the century will not be changed by the proposals on the state earnings-related pension scheme All existing rights at the time of the change will be honoured in full For men aged 40 or over, or women aged 35 or over, their SERPS rights will be enhanced as a firm additional basis for the individual, personal or occupational pensions that they be able to build up under the proposals
  Mr. Heffer: I am sure that the hon Gentleman agrees with me that if people were living purely on the basic pension they could not manage to survive They survive because they receive supplementary benefit, yet it is that benefit and the various benefits that go with it, such as the heating allowance, that the Government intend to affect Can the Minister assure us that those people living on benefits will receive more, or is it the intention of the Government, as it appears to us, to muck about with benefits so that people living at that level will be far worse off?
  Mr. Newton: I hope that the hon Gentleman will forgive me if I come in a moment to the incomes support scheme — our proposed restructuring of supplementary benefit—to which I believe he was referring, and to the wider issue that he raised I wish to complete my remarks about our proposals for additional pensions over and above the basic state retirement pension
  With the continuation of the state earnings-related pension scheme for men aged over 50 and women aged over 45 at the time of changeover, and the proposal for enhanced rights for men aged between 40 and 50 and women aged between 35 and 45, and for the protection of SERPS rights at the time of changeover for others, we have provided a firm basis on which people can build additional entitlement through the new arrangements that we propose to introduce for occupational pensions, whether in a firm or on an industry wide basis, or for personal pensions It means that, for the first time, almost everyone in work will be able to build their own entitlements to their own pensions and will have a specific right to contributions from their employers towards that.
  During the years in which those rights are building, they will represent a major social advance—removing the present "two nations" in pensions—and will be a major foundation for even greater independence and the possession of personal ownership rights in a way that has already been reflected in the powerful desire of people to own their homes In some ways, this is a parallel development to home ownership, and I believe that it will come to be seen as a major social reform.
  Mr. Frank Field: Since the Government have made it clear that the aim of the review is primarily to tackle poverty, could the Minister address his mind to the problems of poverty in old age? With regard to the proposal that people should not be in SERPS but should build private provision, does he expect fewer or more people to be poorer at the end of their working lives?
  Mr. Newton: Our purpose is to achieve precisely what has been happening as a result of the growth in occupational pension schemes during the 1950s and 1960s, which almost came to a halt after the introduction of SERPS: it is to build a position in which everyone retiring shall not need to fall back on additional income-related provision. It would be a rash man who would forecast whether, under the existing structure or in the future, that aim will be achieved, but it is a major objective of our policy to ensure that everyone going into retirement does so with an income adequate — if possible, more than adequate—to sustain himself.
  Mr. Field: If that is the aim, why are the Government setting the minimum provision at 4 per cent., when the private sector says that about three times that level will be needed to guarantee a pension that would achieve the Government's objective?
  Mr. Newton: We thought it right to set the figure in the Green Paper at a level which balances two different considerations. The first is the one which the hon. Gentleman and I have just been discussing, and the general aim to ensure adequate incomes for pensioners in retirement. The other is that we must keep an eye on the effects on employers' costs and people's take-home pay. Therefore, it is a balance between the predictions that can be made about any given contribution level, and the impact today. Liberal Members did not deal with this point in their comments on the basic state retirement pension and their desire to increase it. We must balance those considerations against the bills that must be paid, whether by those providing employment or by those in employment. The 4 per cent. figure is very much a minimum, and it is entirely open to people to add to that provision on their own account, to negotiate with their employers for a larger employer's contribution, or to come to whatever arrangements they wish, provided that those minimum requirements are met. The minimum requirements were set because we also considered the employment and other factors that arise in the present world.
  Mr. Charles Kennedy: Does the Minister believe that the minimum requirements are sufficient on their own?
  Mr. Newton: Yes. We shall, of course, consult those concerned with providing pensions and annuities, and we shall listen to points made on this or any other issue arising from our proposals. The Green Paper is a consultative document. We have already started the process of consultation with those concerned, and we shall take note of what they tell us. But the hon. Gentleman should recognise that under our proposals the only group of people who will be entirely dependent on the 4 per cent. minimum contribution for their additional pensions will be those who, by most standards, although not perhaps by the hon. Gentleman's standards, are very young, that is to say, men under 40 or women under 35, who have a good while to go before retirement and, therefore, have a considerable time to build up their contributions.
  All the groups above that age will either have then-protected or enhanced SERPS rights as well or, in the case of men over 50 and women over 45, they will have their full SERPS pension. One reason we have cast our proposals as we have is that if this was all that was to be
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  provided for people in those older age groups, it would not be possible to build up sufficient provision by the lime of retirement. For that reason we have come forward with this proposed structure.
  In conducting the review and putting forward our proposals in the Green Paper, we have borne in mind the needs of pensioners not only in relation to SERPS or the basic state retirement pension. Pensioners and many other people are at present partly dependent on supplementary benefit for their incomes, and they have faced great problems with the immense, sometimes mind-boggling, complexity of the existing supplementary benefits system.
  Some of the figures are familiar to the House—the 16,000 paragraphs of instructions and the 40-page index. Indeed, there is now a third volume of the S manual. Within all those complicated instructions there is a multiplicity of different types of payment, which means that people are often uncertain about what their entitlement should be. There will be tremendous advantage, not least for pensioners, in our proposed move to a simpler, clearer income support structure within which it is easy to work out entitlement and understand it.
  As the House knows, we are proposing a set of basic benefit rates incorporating premium rates for particular groups, including all pensioners over 60, lone parents and the long-term sick and disabled. A significant further move which I hope will help set at rest the mind of the hon. Member for Liverpool, Walton (Mr. Heffer), is that within the pensioner group we are proposing an additional premium rate for the over-80s. They are most likely to have additional needs arising from growing old age and additional frailty. As a result of the premium payment for all pensioners together with the additional premium payment for the over-80s, and given an additional premium for those between 60 and 80 for whom there is an indicator of additional need — for example, as measured by receipt of disablement benefits — in line with the premium for the sick and disabled, we have created a structure which is far simpler and far more likely to meet the general needs of pensioners than the one at present.
  Mr. Archy Kirkwood: Is it reasonable to try to assess the amount of money to be allocated to these premiums by establishing what is now spent on heating additions, for example, under the existing supplementary benefits scheme so that they could be spread over all the premiums, or is that a completely cockeyed way of looking at it?
  Mr. Newton: I am not quite sure what the hon. Gentleman is asking, but I think I can answer him by saying that we have made it clear that we are not looking for savings from our proposals for the main structure of supplementary benefit. Broadly, our intention is to put back into the simplified structure of rates, including the premia to which I have just referred, the money that is currently spent on various additional requirements. Principally they are heating additions, but also include diet additions, baths additions, laundry additions and a variety of other additional payments which are part of the complexity of the present system. However, in setting the premium rates we shall have regard to the existing distribution of additional requirements and expenditure of the kind to which the hon. Gentleman referred. I hope that

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  that answer follows the general lines of the one he wanted and that it is an indication of the way in which our minds have worked in coming forward with the proposals.
  There are two other important points about the replacement proposals for the supplementary benefits scheme. First, with regard to the income support proposals, we are proposing a further, very important change in the capital rule which I believe will be widely welcomed by many pensioners. That is the introduction of a tapered rule running from £3,000 to £6,000 in place of the present £3,000 capital cut-off—[HON. MEMBERS: "Hear, hear."] I am glad to hear that endorsement from the Conservative Benches and also to acknowledge the nods from the right hon. Member for Tweeddale, Ettrick and Lauderdale and his hon. Friends. It is clear that they also welcome that move, just as it will be welcomed by many pensioners.
  Secondly, the other half of the supplementary benefits replacement is that we are separating into the so-called social fund a number of the highly complex regulation arrangements which currently exist for meeting a variety of specific needs. These include the single payments arrangements, the urgent needs arrangements and, to a significant extent, those arrangements which are directed towards community care needs. We believe that these new arrangements will provide flexibility in dealing with the needs of special cases—their needs as whole people— which now prove extremely difficult in the detailed regulation system, particularly the detailed regulations for single payments.
  Very much part of our thinking which has helped develop our ideas on the social fund is the belief that by operating with specially trained officers we can build on the experience which the Department has gathered since 1980 through the work of special case officers. We can also work more closely than has sometimes been the case in the past with those who are often concerned with the needs of the same claimants in local authority social services departments. That will enable us to build up policies which, for example, are much more effectively directed towards helping people who might need special help because they are coming out of institutions or hospitals and back into the community. It could be that they need special help, in conjunction with local authority social services departments, to ensure that they do not require institutional or hospital care.
  Mr. Heffer: This sounds absolutely marvellous, but what are the limits in relation to the social fund? If there are clear cash limits, what happens if a number of people at a given moment have special needs but the limit is reached? Those of us who live with grass roots people —[Interruption.] Some of us do live with grass roots people, and many of them are our constituents. Can we have an assurance that, when there are genuine special needs, such people will receive benefit under the new system?
  Mr. Newton: We intend that the social fund should operate within an annual budget. That will entail our making arrangements similar to those we make in health authority funding, where many of the same problems can arise. The budget will be allocated to local DHSS offices and the pattern of expenditure, priorities and the need to hold reserves at regional level will be assessed. Nothing
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  that I have seen of existing social provision, where the concept of annual budgeting is part and parcel of annual operations, leads me to believe that we cannot devise effective arrangements for a flexible system which meets needs
  Alongside the simplified and, I believe, significantly improved structure of supplementary benefit which we are proposing we also propose a system of housing benefit which is much simpler, clearer and, we believe, more effective in meeting needs In response to the hon Member for Birkenhead, I said that for the first time the proposed income support system and the proposed revised housing benefit system will be based on the same assessment of income and in accordance with consistent rules It is significant to pensioners and others that, for the first time, we shall have a system of housing benefit that deals even-handedly with those on income support and those who are not
  As the hon Member for Birkenhead has obviously spotted, people on supplementary benefit have 100 per cent of their housing costs reimbursed whereas those not in receipt of supplementary benefit but perhaps have only fractionally more income have only 60 per cent of their housing costs met That gives rise to the problems which have led to the extreme complication of housing benefit supplement We are proposing equal treatment for people on the same income, whether it is derived from supplementary benefit or another source That is a major gam in fairness and equity.
  The right hon Member for Tweeddale, Ettrick and Lauderdale will have realised that I cannot give figures that he wanted [HON MEMBERS "Ah "] I am not running away and will try to avoid the temptation of repeating everything that I have already said
  In addition to those common rules and the common basis for assessment of income for housing benefit and supplementary benefit, the premium rates for pensioners on the new income support scheme will carry through into housing benefit They will become what are known as housing benefit needs allowances.
  Everything I say about structural questions and the folly of attempting now to set benefit rates for April 1987 also applies to the calculation of housing benefit because that will be determined by the income support rates set in the replacement supplementary benefit system and by the rate of taper that we are proposing.
  In any structural reform such as we are proposing there will be swings and roundabouts Some people will gain and others will lose We have made it clear that we intend to ensure that there are no cash losers in the change to the income support scheme We have stated our anxiety to make effective transitional arrangements to protect those who need to be protected, as any reform is bound to affect entitlement We shall consider the implications of the proposal, which I believe is right in principle, for everyone to pay about 20 per cent of their rates The proposal has widespread support on the Benches behind me and, I believe, elsewhere, as it will restore people's interest in what their elected councillors do We have said several times that we shall give appropriate consideration to what is required in that regard as it affects people on supplementary benefit.
  We intend to answer the question posed by the right hon Member for Tweeddale, Ettnck and Lauderdale The proposal for payment of 20 per cent or so of rates should apply to people on income support and to those who

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  receive only housing benefit and have no income support. I hope that our stance is clear. I cannot give the House an absolute guarantee that there will be no losers, because of the nature of the changes. I am giving an assurance that we shall have in mind what the right hon. Gentleman said when setting rates and establishing the transitional arrangements.
  I have taken a lot of the House's time—fairly, I hope I can claim—responding to questions. I will leave it to my hon. Friend the Parliamentary Under-Secretary to wind up the debate and to comment on death grant. I should like to observe, however, that everyone gets only £30, which is of very little use and that it is unsatisfactory that only those on supplementary benefit receive full help with funeral costs. We are proposing that genuinely adequate help should be available to those who need help to meet funeral costs rather than only to those on an existing means-tested benefit. The right hon. Gentleman's proposal would not achieve that end. His proposed £250 for everybody would not be enough help for people with no means. I hope that the right hon. Gentleman will reconsider his proposal.
  The review's purposes are to meet the social conditions of today and those which we can foresee for the rest of the century, to create a simpler and fairer system so that people, not least pensioners, genuinely get the benefits to which they are entitled, and to create a soundly based system that can deliver the promises it makes. Nobody has a greater interest in our achieving those objectives than pensioners, and we mean to see that they are secured.
  5.40 pm
  Mrs. Margaret Beckett: It is right that the first aspect of the Green Paper should be the proposals that affect the elderly, because, leaving aside the rhetoric, the Government's attitude to pensions most clearly reveals the twin purposes of their reviews. First, there is the obsession with cutting public expenditure for the sake of cutting, or, perhaps, for the sake of the few individuals —the better off—who alone have reaped the benefit of the cuts. Secondly, there is the obsession with destroying public services—financial or otherwise—simply because they are public services.
  The most significant change that the Green Paper has proposed is the phasing out of the state earnings-related pension scheme. The more we consider the matter, the more extraordinary this decision seems. Already it appears that contributors to the scheme — the few who are allowed to stay in SERPS—will, at best, pay slightly more without receiving improved benefits. The vast majority of people will pay substantially more and receive substantially less, especially as those in occupational schemes will lose the state's hedge against inflation and the standards against which those schemes have been measured.
  We have yet to learn the costs of abolition in terms of tax concessions on the compulsory private pensions with which the Government plan to replace SERPS, although there seems every likelihood that they will run to several thousand million pounds. We are aware that the Government have argued during and before this debate that massive and unforeseen changes have made the abolition of SERPS necessary. The Government have not explained at all—never mind to our satisfaction—why these changes were not understood, not only in 1975, as the Government now suggest, but in 1981 when the bulk
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  of the statistics on which this policy is based were published. The Government have not explained why the conclusions were not understood in 1983 when the- Prime Minister gave one of her famous assurances or even in 1984 when the Secretary of State gave his assurance. The statistics for pensioners and for the contributory population that are used now are almost identical in every respect to those that were used years ago.
  What happened between the assurance in 1984 by the Secretary of State and June 1985 to bring about this massive change in understanding and in policy? Ii is not that there has been a massive change in the anticipated number of pensioners or in the ratio of contributors to non-contributors. The Secretary of State produced a half-baked, half-thought-out plan, justified by reference to a misinterpreted opinion poll, for what he called "personal portable pensions." That is not even easy to say. Ii was a plan not just for privatising, but for individualising pensions. The trouble with the plan was that, the more people looked at it, the more they pointed out that no one in his right mind would buy the right hon. Gentleman's portable pension when he could get a much better deal from the existing state scheme. Full transferability, guarantees against inflation and a pension with a decent maturity period were all provided in the state pension scheme. That scheme was a much better bet than any private scheme. One after another individuals and the institutions that advised the Secretary of State published articles or wrote privately pointing out to the right hon. Gentleman that no one would buy a personal portable pension unless the Secretary of State first abolished the superior state scheme.
  We all realise to our cost that telling the Prime Minister that the state is doing something better than the private sector—that the administrative costs are lower so that the state scheme gets even better value for money than the private sector—is like a red rag to a bull. The Prime Minister knows what she believes and she does not want to be confused with the facts. She knows that anything that the state provides must be bad—that it must be worse than the private sector. If, by some chance, the state scheme is better than the private sector scheme, her motto is "Get rid of it quickly before anyone finds out."
  Because the Government must acknowledge that they are replacing a good pension scheme with a worse one at a higher cost, it has been necessary to preach doom and gloom about how SERPS has not really been a good scheme because it has been so wickedly over-generous to pensioners. We have heard before, and no doubt shall hear again, reservations about the necessity for and the wisdom of the Government's proposals — whether it is rhe example of the Phillips committee howlers in 1954 or the Government's own Social Security Advisory Committee's devastating criticisms a year or so ago.
  Even leaving aside all the other questions about the accuracy or truthfulness of the Government's claims about the problems with SERPS, one major issue remains. The Government Actuary points out, and is quoted as saying in the background paper to the reviews, that the possible rise in contributions that he identifies will occur at the level given only if the link between pension upratings and earnings is restored — the link that this Government abolished in 1980 and that they have always refused to restore. While the basic pension remains linked only to prices, its value over the years will be so eroded that, even

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  if the Government do not lay a finger on SERPS, eventually the total pension will be sufficient to equate only to the value of the pension today.
  Those who have no entitlement to SERPS because they have not yet found a job, or those who are not wanted by the private insurance companies because they are on the dole or sick, will remain heavily or totally reliant upon the basic pension and will end up completely reliant on whatever scheme replaces supplementary benefit by the end of the century or later. Even on the Government's own predictions before they decided to abolish SERPS, at the end of the century there will still be a million pensioners on supplementary benefit. I shall not bother to ask the Minister how many more he thinks there will be if the Government abolish SERPS, because I do not suppose that he can tell us that either.
  Apart from the value of the pension itself, the Government's argument that we cannot afford to let SERPS continue has been severely damaged. If the Government continue to link the basic pension only to prices, the contributions will ultimately reach not even the predicted 20 per cent.—the figure that the Government love to cite—but
  "less than half of that",
  in the Government Actuary's words. We can forget all the weeping and gnashing of teeth about the cost of SERPS. The Government did a demolition job on SERPS five years ago, in 1980, and it is totally gratuitous for them to return to it now.
  That is not the point of this proposal. The point is that SERPS, plus an eroded basic pension, is still better than a private pension plus an eroded basic pension, and that is why SERPS has to go.
  My hon. Friend the Member for Birkenhead (Mr. Field) asked the Minister whether he could give an assurance —wisely, the Minister was not drawn on that point— that the personal portable pension, or whatever the new plan is, will give as good a pension provision as or better than SERPS would have provided. The Minister knows that the answer is, "No, it will not." The Government, in their consultative document, specifically ruled out giving any guarantees on the value of personal portable pensions. Indeed, they said that anyone who took out such a pension could not rely upon any fallback or guarantee from the state—presumably, other than supplementary benefit or the basic pension—because that person would be taking an individual risk and would be out on his own. If the new scheme is as good as or better than SERPS, there would be no need for the Government to warn the people whom they wished to remove from those pensions that the Government would not pick up the pieces.
  The Minister said a good deal about the Government's record and how grateful pensioners are. I do not know whether the hon. Gentleman has tried recently asking pensioners how grateful they are. He is fond of pointing out the dangers of inflation. We all recognise that inflation has undesirable consequences, but under the Labour Government the real value of the pension increased by 20 per cent. It seems to be difficult for Conservative Members to grasp that simple fact. Despite the problems that we faced, we managed to help those drawing the pension then and, by establishing the scheme that the Government attack in these reviews, to provide for the pensioners of the future. This Government are attacking both.
  Mr. Newton: I hesitate to interrupt the hon. Lady, but, in view of her remarks, I must ask whether she would care to comment on the adjustment in 1976 to the uprating method, which did not take account of several months of rapidly rising inflation and cut what in today's money would be at least £1 billion from the amount that pensioners would otherwise have received. I remind the Liberals, since they introduced this debate, that the Lib-Lab pact was made the following year.
  Mrs. Beckett: Whatever may be the criticisms of the record of the Labour Government, we still improved pensions in real terms by 20 per cent., which is more than the present Government have managed to do.
  I remind the Minister of another simple fact which I have drawn to his attention on other occasions. In our whole period of office, we had only as much from the North sea in terms of income as the Government have received every month throughout their period of office. Even with our problems, we managed to increase the real value of the pension by 20 per cent., so perhaps we should hear rather less about how great the Government's record has been. The first thing that the Government did was to erode the basis of the improvement, the link with earnings, although they still paid lip-service to their concern for the elderly.
  Although SERPS is most significant in the sense of revealing the purpose of the reviews, neither the proposals on SERPS nor the reviews themselves represent the whole of the attack on the elderly that we have seen in recent years. I am not even referring to what the Minister said about changing uprating. He knows that his Government have saved money by changing the basis of uprating. They have saved money on three occasions by postponing by a week or two the payment of pensions. They have saved money by reducing heating allowances.
  Most of all, the Government have saved money on pensioners by the massive cuts in housing benefit. I might have said more about the cuts that we have already seen — and predicted — in housing benefit, except that previous debates have shown that there is very little point in asking Ministers to give us more indications of who will be affected and to what extent. We know that the Government have the figures but do not intend to reveal them to us. As they are, according to the Minister, so good, it is surprising that we have not been told about them. The Government are not usually reluctant to claim credit for being generous to the populace. As I have said, we know that there will be cuts in housing benefit, and we strongly suspect that occupational pensioners in particular will be the sufferers.
  The most vulnerable among the elderly have been consistently among the hardest hit. The leader of the Liberal party referred to the forced increases in water rate which are being brought about by the Government. They follow hard on the heels of a series of forced increases in fuel costs, which have fallen particularly hard on pensioners. The pensioners who are poor enough now to be drawing supplementary benefit are precisely those pensioners who often fall foul of the system of single payments to which the Minister referred.
  A wide range of problems which affect everyone who is poor bear even more harshly on the elderly. I have recently received some communication from chiropodists —I hope that Minister will be able to comment on it later — about the hardships caused to pensioners in

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  regard to single payments, and the wholly inadequate grants which are received—if, indeed, they are received at all. Some people have too many deformities of the feet to wear ordinary shoes but are not sufficiently severely affected to justify the wearing of surgical shoes. Many pensioners find that, if they can get assistance, it is wholly inadequate to meet the cost which they have to bear. In that context, as in many others, it was pointed out to me very forcefully that the cost to the state of chiropody charges and the cost to individuals in pain and discomfort greatly outweighs the cost of a more sensible system.
  Although the Minister spoke with touching confidence in his new proposals for a social fund, which he seems to think will be better than the single payment system, the Opposition have even more worries and concern about his proposals than we have about the existing scheme—and, heaven knows, that is saying something.
  The leader of the Liberal party referred to problems connected with the death grant, and I am aware that the Parliamentary Under-Secretary of State will be replying on that point. When the Secretary of State for Social Services made his recent statement, my hon. Friend the Member for Oldham, West (Mr. Meacher) referred to people having to have a pauper's funeral. Conservative Members sought to discount what my hon. Friend said. If they do not like that term, they may be more touched by the term "parish funeral." In the folklore of our parents and grandparents, that was always something devoutly to be avoided. To be buried by the parish was regarded as a great stigma and source of shame. The more I hear about the Minister's proposals for a social fund, the more it seems to me that they will result in the reintroduction of the stigma.
  I was entirely unconvinced when I heard the Secretary of State say that the lack of an appeal process will not fall foul of the European Court. I noticed that the Secretary of State was prepared to put the blame on the Minister for Social Security if that did not turn out to be the case.
  We are also concerned about the staff at the DHSS. I am not sure whether they will retire early, die of heart attacks, have nervous breakdowns, be murdered or lynched, but I am sure that there will be a substantial increase in the turnover of DHSS managers.
  Mr. Newton: The entire basis of the scheme was largely discretionary until it was put into regulations in 1980. The notion that a modest return to discretion, in an area in which regulations have not worked very well, will defeat a system which operated largely on the basis of discretion for so many years cannot be supported.
  With regard to death grant, the terms "pauper's funeral" and "parish funeral" refer to something which can still, in theory, exist—burial by the local authority. The local authority still has that duty in certain cases. In my experience, supplementary benefit single payments are not seen as being the same as a pauper's funeral. The hon. Lady is drawing a misleading and wrong parallel in suggesting that they are the same.
  Mr. Deputy Speaker (Mr. Harold Walker): Order. It would be better if, instead of having ministerial interventions, particular points were dealt with in the reply at the end of the debate.
  Mrs. Beckett: The elderly are also severely affected by the changes in the provisions concerning board and lodging. The elderly are affected, as are other groups, by the ceilings imposed on board and lodging. If the lodging
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  in which the elderly have been staying has charges above the ceiling, or if there is a wish to increase the charges, which would take them above the ceiling, that is a matter of considerable concern to them. Assurances were given that such matters would be looked at.
  A particular problem which has been drawn to my attention recently, affects handicapped people who are just under 65 and eligible to have varying sums paid to their account, the maximum being £198, because they are under 65. It is my understanding that on the day people become 65 — if it happens to be more than a year since the regulations became law — they are now eligible for a payment of only £138.60. That is a reduction of £60 in the payment which can be made. I am told that that has already begun to happen to people in nursing homes. Indeed, I have a case—I shall pass it on to the Minister—of a home in which two or three such people are already affected. Obviously, it is a very serious matter, not only for the homes which are trying to provide proper nursing care but for the individuals who are affected. I find it hard to believe that even this Government intended that there should be such appalling side effects.
  There are also the problems which arise where margins in homes for the elderly are cut to the bone. There is a fear that it may be necessary to reduce the level of provision of the very services that the Government have asked them to provide under the code of practice, such as proper training for staff and proper care for residents.
  I understand that there are considerable differences of opinion arising between local offices as to who is to decide whether the level of fees is appropriate for the area concerned, although I recognise that the whole intention was to take some of the discretion away from local offices. In some areas, it is being said that payment above the ceiling can be made for a substantial period, while in others it is being said that the new figures must be implemented immediately. I hope the Minister will look into the question of how much discretion is being permitted.
  Our main concern in the debate is the overall problems faced by the elderly of today. They include those who struggled to bring up their families before the introduction of the welfare state, the men—all too few—who fought in one or perhaps two world wars, and all too many of their widows. They include those who worked and struggled to establish a better society and who hoped to crown the victory that we commemorated this year with a society dedicated, for the first time in our history, to the principle of from each according to his or her ability and to each according to his or her needs — in other words, the principle of the welfare state.
  It is a tragedy that, towards the end of their lives, they should be seeing a Tory Government who are not only trying to undo everything that most of them worked for but are making it plain, by their attitude to the pensioners of the future as well as to those of today, that they reject that fundamental principle of the welfare state.
  It is still among the most elderly that the greatest reluctance exists to claim the benefits to which they are rightfully entitled — even benefits for which they and their families have paid—because they feel the stigma of charity, not rights, hanging even over the welfare state.
  I must tell the Minister frankly that, in my opinion, the real meaning of the reviews, for the elderly and for everybody affected by them, is that, whatever the

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  Government may say, their desire is to reintroduce that stigma. They may not use those words, but that is what their words mean.
  Not long ago a comedy show ran on television for almost as long as the present Government have run. It was called, "Never mind the quality, feel the width." The proposals that we are debating today are, unfortunately, as poor in quality as we fear they will be narrow in generosity.
  6.2 pm
  Mrs. Virginia Bottomley: Today's debate is concerned with the problems of the elderly. In my constituency, the elderly deeply resent being referred to only in relation to their problems. Indeed, some may feel that an advantage of televising the debates in another place is that all can see the contribution to public life that is made by many over retirement age. Most pensioners are fit and able to assist their families. More importantly, they are able to make an enormous contribution, in voluntary organisations and other types of service, to the community.
  When talking to pensioners today one discovers that income maintenance is not their greatest fear, though it is understandable that the right hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) should have referred to income. After all, at the time of the Lib-Lab pact, with inflation running at more than 25 per cent., many pensioners were afraid that they would not have sufficient income to see out their lives.
  In fact, pensions have kept up with the cost of living, and during the past 30 years there has been a substantial shift in resources in favour of pensioners. The result is that today many pensioners are better off per head than the households of those in work.
  Pensioners are worried mainly by the fear of isolation and alienation. It is clear from recent census returns that many more elderly now live alone. With people living much longer, there has been a dramatic increase in the number of over-80s, and these are causes for concern.
  In recent years, under Conservative rule, there has been a 15 per cent. increase in resources devoted to the personal social services, a 20 per cent. increase in real terms in expenditure on the health services and there are more nurses, district nurses, doctors, health visitors and so on. All of that has made for a great improvement in assisting the elderly. More important than even those services is the way in which they are used, and there have been many initiatives in care in the community, with people being brought into voluntary organisations so that the elderly can be helped to live at home.
  I am vice-chairman of the National Council for Carers and their Elderly Dependants, an organisation with approaching 50 branches throughout the country, helping informal carers such as those to whom the leader of the Liberal party rightly referred. These people selflessly look after those who, wherever possible, can live at home. The Department has given assistance to the NCCED and incorporated them in plans and initiatives. There are, however, many other groups in the community helping to make the elderly feel valued and important. They include the WRVS and Age Concern, whose members know a great deal about training and the needs of the elderly.
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  Last week I visited some housing developments for the elderly in my constituency I saw with pride the great variety of provision that is being made, including sheltered housing, cluster housing and good neighbour schemes I was made aware of the way in which developments are embracing some of the new technologies For example, it is possible to have a radio link with a headquarters so that those in difficulty can call for help.
  It is all too easy to polarise provision and only to consider whether it is provided by the state or the private sector The provision of old people's homes has been a controversial area, and I welcome the new regulations for the registration of homes for the elderly Over the years there have been many articles and research projects highlighting the treatment of people in homes for the elderly Recent research at the university of Bath made it clear that under the new procedures many such homes in the state sector would have difficulty getting registered and becoming approved as private homes.
  Recent events in Southwark at the Nye Bevan home have provided a particularly appalling example of what can happen under local authority provision We need a partnership and balance between private, voluntary and local authority homes, and it is wrong to suggest that there is some type of hierarchy.
  The elderly want to feel acknowledged and valued members of the community They want the Government to sustain then: policies for the Health Service, making sure that patient care is given priority and that the resources available are used effectively They want to see the social services maintained and, where possible, improved They want support for informal carers, for all those who voluntarily, giving then own time, help others Above all, they want flexibility and choice so that they may have dignity in their old age, making a contribution to the community while in their active years of retirement, then being supported with the help they need on becoming more frail towards the end of their lives.
  6 8 pm
  Mr. Frank Field:It is customary to comment on points made by the previous speaker I hope that the hon Member for Surrey, South-West (Mrs Bottomley) will forgive me if I do not do that on this occasion, though I confess that if I were a Conservative Member speaking in this debate, following the announcement of a major review of the welfare state, I should have made a contnbution similar to hers It was clever in the way it distracted attention from some of the immediate plans of the Government
  I shall refer to some matters that were raised by the right hon Member for Tweeddale, Ettrick and Lauderdale (Mr Steel) and my hon Friend the Member for Derby, South (Mrs Beckett), the first being to question how the Secretary of State was able to boast that his review of the welfare state, which will result in another Beveridge, could be presented to Parliament without one figure to show how individual groups of claimants would be affected.
  The Minister of State answered that question today by saying that the Government were concerned with the structure of benefits and that once the consultation period was over the figures would be provided I have a suggestion which puts a different light on what is really going on We have read much in the press about the success of the Secretary of State and his team in fighting

  483
  off Treasury attacks on the welfare state. Is it possible that it was a clever ploy by the Secretary of State to make his statement on Monday without giving any figures? Is it possible that that was part of a deal that he had to strike with the Chancellor of the Exchequer? Is it possible that the efforts of the Treasury to cut welfare provision will continue as we embark on this year's review of public expenditure?
  Has all that resulted in Ministers at the Department of Health and Social Security being forced to talk only about the structure, when hon. Members in all parts of the House want information about the rates of benefit so that we can work out who among our constituents will be better off and how many thousands among them will be worse off?
  The Minister's clever ploy was no mere accident. He was pushed into it. It takes more than nerve for the DHSS team to come to the House and behave in this way because only a few weeks ago the Secretary of State and the Minister of State savaged my hon. Friend the Member for Oldham, West (Mr. Meacher) for presenting proposals which he had not fully costed. We were told that it was outrageous, irresponsible and typical of the Labour party. Today the Government propose a major overhaul without providing a single figure.
  Perhaps the Minister can say whether my analysis is correct. I do not wish to score points, but if I am right and the Treasury is still after cuts of £2 billion or £4 billion the support of Government Back Benchers will be needed to fend off an attack. Ministers must not take pleasure in mystifying themselves and their own Back Benchers about what they are up to.
  The state earnings-related pensions scheme is to be abolished. That will mean a worse deal for women and for low-paid workers. Despite the Minister of State's debating skills, when asked whether the alternative will be superior in terms of tackling poverty he was reticent. The private sector says that if workers are to build up contributions over their lifetime to afford a pension which will prevent them from being in need in old age, contributions must be between 12 and 14 per cent. of their earnings. The Government are talking about contributions of 4 per cent. SERPS is to be abolished, but the alternative will not achieve the Government's objective of taking people off means tests and making fewer people less dependent on state support.
  The Government are loose in their use of language. Certain phrases appeal to their Back Benchers and many people in the country. They say that we must target resources to those in greatest need. That is a good phrase, but let us examine what the Government are doing— although that is difficult since we have no figures.
  Let us examine the simplification involved in replacing the supplementary benefit scheme with the income support scheme. The Government intend to simplify the scheme by abolishing all the additions to basic benefit which are currently given for heating, diet and special laundry needs. According to Government language, there could not be better targeting than that because the extra allowances are given only if a dietary, heating or laundry need can be shown.
  The Government's alternative is a premium that will apply to everyone at present in that category. The jam which was spread less thickly amongst those in greatest need is to be spread more thinly amongst all people in that category. Even without the figures, we can see that some of the Government's objectives will not be achieved.
  484
  I hope that two clear messages result from the debate today. One reason why the Goverment have not provided any figures in connection with this major overhaul of the welfare state is that the struggle about the level of welfare support is continuing between the DHSS and the Treasury. Once that dispute is settled and the figures are available we shall know the extent of the cuts. Whenever hon. Members ask how many people will be better off and how many millions will be worse off, Ministers will not reply with a straight answer. It is right for the leader of the Liberal party to sound a note of worry that millions will be worse off as a result of the review, although we may not be able to put exact numbers on it until later in the year.
  SERPS has faults and the Government are correct to say that we have a problem with an aging population which is increasing relatively faster than our working population. Despite those problems, the Government are abolishing SERPS which is the only method on the statute book which guarantees bridging the link between poverty and old age for most people. The Government's alternative will not achieve that. There will be many more poor pensioners in the future. I hope that the messages are received loud and clear in the country.
  6.16 pm
  Mr. Anthony Steen: If I were a Labour Member — I hope that I never shall be — I should probably make a speech similar to that made by the hon. Member for Birkenhead (Mr. Field) if I understood the subject as he does, but I shall not follow his line. I want to explore the wider issue discussed by the leader of the Liberal party.
  The debate has tended, like so many others, to focus on money. The hon. Member for Birkenhead concentrated on money. He is an expert on such matters, but money indicates something about attitudes. The extent of Government expenditure on the elderly tells us something about the Government's attitude.
  Last year £6.5 billion, or 40 per cent. of the Health Service budget, was spent on the elderly. Does that mean that the Government care about the elderly? Would the Opposition say that the Government were more caring if they spent 50 per cent. of the budget on the elderly? What is the cut-off point or the starting point of caring?
  Hon. Members on both sides of the House are caring, and even if we spent a few more billion pounds it would not mean that we were more caring. The Labour party thinks that it has a monopoly of caring. It has a habit of championing minority groups such as the elderly, the handicapped and the disadvantaged. Anyone who is not quite up to the next man is labelled "disadvantaged" and immediately attracts the Labour party's interest.
  Today the Liberal party is trying to upstage the Labour party by arguing that it can do even better for the elderly than the Labour party and that it cares even more. No party has a monopoly of caring. The test of who cares most is not decided by who spends most. The elderly must have opportunities for maintaining good health and human dignity. The dignity of the elderly is most important.
  Society in various parts of the world views its elderly in many different ways. In the east the elderly are still revered as the heads of the family. In developing countries the elderly play a full part in family life. In many European countries they continue to head the family business. The elderly have the status of experience, wisdom and prudence.

  485
  In Britain, the elderly and their problems are seen as something with which the state must deal—it is not for the family to look after the elderly, but for the Government. The trade union movement continues to fight to lower the retirement age, but unwittingly it is compounding the problem. There is an ever-growing number of retired and elderly people. The term "elderly" tends to be synonymous with being retired from paid work.
  Old age begins in Britain when one becomes a pensioner, and pensioners are becoming pensioners as early as 50. They switch from being part of society to being an adjunct to society. It is rather like Cinderella. One day one is in a job and the next day one is old — someone who attends Christmas parties and wears funny hats.
  Rather than being revered, our elderly tend to be patronised. They receive concessions for travel and special prices at cinemas. Yet the major problem is life expectancy, which is increasing in leaps and bounds. We are spending £17·4 billion a year on health care and as a result it has improved dramatically. Whereas in 1985 there were about 3·5 million people over the age of 75, by the year 2050 there will be nearly double that number—6 million people. Whereas this year just over 500,000 people are more than 85, by 2050 there will be nearly 2 million—three times as many. That is one aspect that has not been mentioned in the debate. We must consider the scale of the problem and the increased life expectancy of society. We therefore have the prospect of increasing numbers of people spending a quarter of a century or more of their lives as pensioners.
  There are two problems. First, where will all those retired people live for a quarter of a century of their lives? Secondly, what will they do with their time? What will they do day after day when they are retired and have nothing to do? A large majority of retired people will continue to live in their own homes—whether owned or rented. However, there will be an increasing need to build special-purpose bungalows and warden-controlled complexes, and that entails an increase in public expenditure.
  There has been a growth in the number of residential homes. In 1982-83, expenditure on the care of the elderly in residential homes rose from £39 million to £102 million. Expenditure for last year is estimated at £190 million. While private homes provide better value and lower costs than local authority homes—[Interruption.] Oh yes they do. I do not know why Opposition Members are making a noise. They know that what I am saying is absolutely right. Private homes provide very much better value than local authority homes. I shall not bore the House with statistics, but I have them to hand, as does my hon. Friend the Minister. Although private homes provide better value than local authority homes, the cost of keeping the elderly in private homes rose from £39 million in 1982–83 to £190 million this year.
  There is a further advantage: caring for the elderly in private homes entails half the cost of keeping an elderly person in a geriatric bed in a hospital, the current cost for which is £243 a week. As the population lives longer, the burden and the cost on the state will continue to increase—
  Mr. Willie W. Hamilton: What burden?
  Mr. Steen: It is a very real burden on the state. The state will not refuse to accept that burden, but it is a burden.
  I am sure that Opposition Members will agree that the one way in which the Government can endorse their family policy is to encourage more people to look after their own. I have never understood why the Government do not give some benefit and tax relief to those devoted people who look after their elderly and frail parents. They dedicate their lives to looking after their families. And it need not be only parents; it could apply to uncles and aunts. It is a better way for retired people to live, and would not be a strain on the state. Yet the Government continue to refuse to give tax relief to those looking after their families.
  Mrs. Beckett: The hon. Gentleman is making a comment that Opposition Members often make. The reason why the Government do not provide such help is simple: they seem to be quite incapable of distinguishing between cutting public expenditure and getting value for money.
  Mr. Steen: I should have expected a helpful remark like that from the hon. Lady, and I am sorry that I gave way.
  Not only will the Government save money by giving tax benefits to those who look after their own, but it is far better that the elderly should live with their families. I hope that my hon. Friend the Minister will say something about that when he replies.
  Money and housing appear to be the nitty-gritty of the problem facing the elderly, but I believe that there is a more sinister problem—loneliness. The House has not addressed that point in the debate. The problem of loneliness will eclipse all other problems as the elderly live longer. They need a purpose in life. I have met few who are ecstatic at the prospect of retirement, especially early retirement. They see little future in their lives, there is little prospect of paid work to augment their pensions and they have few opportunities to do something in society. I am grateful to my hon. Friend the Minister for what he said about voluntary work.
  Loneliness is one of the worst and most intangible conditions of our time, especially for the retired living in our large urban areas. What are they supposed to do for a quarter of a century? They cannot travel on a bus with their concessionary fares all the time; they cannot play bridge or visit the museums or eat at luncheon clubs all the time. What are they supposed to do other than watch television and wait for a knock on the door? The Government need to help them find a new purpose, a new role and a new aim. People will be increasingly out of paid work at a younger and younger age.
  We have a vast and increasingly fit army of young retired people who have a wealth of experience, knowledge and skills. We have to find a task and a purpose for them. There is a tremendous waste of resources. [Interruption.] The hon. Member for Birkenhead appears to be either anxious to leave the Chamber or in some discomfort. Although he is very good at juggling with statistics, he overlooks the importance of the humane aspect of caring for the elderly. It is all about the real problems of living, rather than simply playing around with statistics and money. It is the problems of loneliness, caring and having a part to play in society. I am sure that the hon. Gentleman will understand that—
  Mr. Frank Field: The hon. Gentleman appears to be advocating a charter for busybodies.
  Mr. Steen: The hon. Gentleman may say that, but this evening we are airing the grievances and problems of the elderly. We must tackle those.
  I asked what an elderly person would do for a quarter of a century. He cannot travel on a bus the whole time, or watch television the whole time. What is he supposed to do?
  Mrs. Kellett-Bowman: Does my hon. Friend accept that the Government's plans for a flexible decade of retirement would go some way towards meeting my hon. Friend's point?
  Mr. Steen: Yes. My hon. Friend always puts her finger on it. I am glad she is joining in the debate.
  We have debated many matters this evening, and I hope that I have made a short but helpful contribution. It was right for the leader of the Liberal party to raise the problems of the elderly. I regret that so few Opposition Members feel that this is a topic of such importance that they wish to join the debate. I am glad that a few members of the Liberal party, though only a few, are present and also that a few members of the Social Democratic party are here. I am pleased that many of my right hon. and hon. Friends have spoken in the debate. I support the Government amendment. We are on the right path towards helping the lonely and the elderly.
  6.31 pm
  Mr. Michael Meadowcroft: I am sure that the hon. Member for South Hams (Mr. Steen) will be pleased to hear that I intend to put the other side of the coin. I do not know why he regards six Back Benchers of his own party as a large number. If he does, he is innumerate or is exaggerating. I do not accept that if people do not pay rates directly through their rates bill they are not contributing to rates income. I fear a cop-out by industry if it regards rates as being paid simply by ratepayers. Every customer and employee of a company pays its rates. The Confederation of British Industry recognises that fact and has pointed out to its employers and customers that high rates affect viability. It wishes to alter that position.
  The social security reviews are defective because they do not tackle linkages. Although I agree with the hon. Member for South Hams that a case can be made for extra expenditure upon the social services or social security, there are many other problems that can be tackled without spending extra money. Normally they can be dealt with by linkages. Some houses are under-occupied and could be used by families. They remain under-occupied because there is insufficient sheltered housing for single people. It is a waste of resources which the single elderly deplore. The clearance of inner city areas has contributed towards the huge escalation in costs. The small, old houses that people prefer to live in have been demolished. Clearances are still taking place and ought to be stopped.
  If elderly people wish to remain in their own homes, an adequate attendance allowance might make it unnecessary for them to enter institutional care. An attendance allowance would be far cheaper than institutional care. The social services have a part to play by providing day centres which enable the elderly to be fed properly. The voluntary sector can help. The community
  488
  transport project takes people to the day centres. The National Health Service can also play its part by providing community nursing. If all these services were pulled together, better and cheaper care would be provided for individual needs. The social security reviews have failed to deal with the problem in that way. They have simply shifted money around from one needy pocket to another.
  6.34 pm
  Mr. Charles Kennedy: This has been a very useful and worthwhile choice of subject, particularly since the social security reviews were published this week. The alliance has chosen the problems of the elderly as one of the first subjects to be debated. This is the first opportunity to scratch the surface of the debate that will take place between now and the publication of the White Paper.
  I appreciate the lengths to which the Minister for Social Security went to listen to the views which were expressed and then, with great skill, to skirt around the answers that were sought. The Minister should not rest too much upon this Government's apparent laurels. My most enduring impression of the day when the reviews were published was not of the Secretary of State for Social Services being given a characteristically easy time because of the hysterical reaction of the Opposition Front Bench spokesman. It was of several pensioners marching outside carrying placards saying, "Pensioners say 'No' to Fowler".
  When he opened the debate, my right hon. Friend the leader of the Liberal party rightly criticised the lack of figures. The lack of figures in the published volumes compounds the error that was pointed to by many people at the time of the reviews: that they were being conducted on a revenue-neutral basis, which meant that examination of the hidden welfare state provided by tax benefits would be precluded. Therefore, it is difficult to make constructive comments about the suggestions. The Minister for Social Security engaged in an almost theological discussion about the relationship between the financial aspect and the structure at which we should aim. He seemed to be trying to make a virtue out of a vice. At least, he said that the absence of vice in itself constituted a virtue. The Minister claimed that the absence of damning figures about who would lose and at whose expense some gains would be made was to be welcomed. It is rather like the words of the old song:
  "I've danced with a man, who's danced with a girl, who's danced with the Prince of Wales."
  Nobody has seen the culprit but everybody has passed by at some point. The review figures seem to have passed through several hands, but they are not available when we want to debate them.
  The hon. Member for Birkenhead (Mr. Field) made a similar point. He pointed out that the Government actuaries have been both for and against SERPS. My right hon. Friend the leader of the Liberal party said that we could not back the Government's course of action over SERPS because of the way they have gone about it. SERPS was set up after all-party consultation. If it is to be restructured, modified or done away with completely, it should take place only after there has been all-party discussion. We also oppose its modification because there is to be no major increase in the basic flat rate pension. Most people accept that this would be an important counter-balance if there were to be any change in SERPS.

  489
  Finance is one of the great defects of the social security reviews. The social fund will be a major contributor to the view that the public form about the reviews. There is interaction in the social fund between the benefits system and the personal social services. It will be cash limited. A system of discretionary grants and loans will be operated. The Secretary of State for Social Services wants the social fund to be used as a pump-priming mechanism in order to move people through the care in the community programme. This demonstrates that the Government tacitly acknowledge that the amount of money available to help the elderly through the care in the community programme is insufficient, that it is being damaged by the rate capping proposals of the Department of the Environment and that the joint funding arrangements are unsatisfactory because of the tapering financial arrangement and the relationship between the health authorities and the local authorities on account of the local authorities having to shoulder more of the burden. The Government are trying to find an additional source of money to help to prop up joint funding and the financing of the care in the community programme. That highlights the difficulties in funding and the fact that there will be an even greater drain on the social fund, which will be under great pressure.
  The hon. Member for Surrey, South-West (Mrs. Bottomley) spoke about the role of the voluntary organisations. As my right hon. Friend the leader of the Liberal party has said, it is important to remember that much can be done. The voluntary organisations have a great role to play. However, as the hon. Member for Surrey, South-West knows through her patronage of the National Council for Carers and their Elderly Dependants, the role that can be played is threatened and made more difficult by the financial pressure under which the statutory sector now has to operate. Directors of social services who are faced with difficult choices are more likely to reduce or contract in the voluntary rather than in the statutory sector.
  The other points that have come out of the debate are closely linked to what have been described by the Liberal leader as the "pessimistic assumptions" underlying the entire report. In an interview in the Daily Telegraph towards the end of last year, the Leader of the House said that he thought that there was great room for increasing employment in the front-line caring services. Instead of considering further cuts in the social services network, we should be trying to create jobs in that area. Indeed, during the last election campaign, the alliance suggested that 100,000 jobs could be created within the front-line caring services.
  As has been pointed out, more needs to be done to locate, recognise, and then introduce mechanisms of support for those who care for others on an unrecognised and informal basis. The welfare state may be in difficulties now, but it would be in a state of total collapse and disorder without their contribution. The extension of the invalid care allowance to married women is another area in which we should like progress to be made. Unfortunately, however, that seems unlikely as a result of the reviews.
  I appreciate that the Minister will specifically deal with the death grant. The Minister for Social Security stated his concern or objections about the system that we would propose, which would involve a higher £200 or £250 death
  490
  grant, available across the board and reclaimable from the estate. He fairly pointed out that even that would not be enough for some people. But it is surely not beyond the wit of the DHSS to devise a structure whereby at the time of burial and of greatest distress to the relatives and dependants there would be no need to go through the difficulty and indignity of having to make some special application, perhaps subject to interview. They could receive the initial payment as of right. If it then proved to be too much, the money could be reclaimed from the estate, but if the sum proved to be too little, the discretionary element could come in later and additional payments could be made. I do not see why that should sit so uneasily beside the Government's proposals.
  We are glad to have had the opportunity to raise issues concerning the elderly that arise from this week's social security reviews and from the problems which all hon. Members see every day in their constituencies. We are only sorry that social security reviews which could have been radical and genuinely reformist and more redistributive will not be so. As the Institute of Fiscal Studies has already said, the elderly will be one of the groups to suffer most from those reviews.
  The points that have been made, coupled with the difficulties over rent support and having to contribute to a rating system with which the Government themselves are dissatisfied, give us little confidence that the problems of the elderly are fully recognised and appreciated, or that they will receive due attention from the Government. The SDP/Liberal alliance will certainly continue to bring the problems and the priorities of the elderly to the fore both in the House and elsewhere.
  6.46 pm
  The Parliamentary Under-Secretary of State for Health and Social Security (Mr. Ray Whitney): I am happy to start on at least one note of agreement with the hon. Member for Ross, Cromarty and Skye (Mr. Kennedy), in that the debate has been useful and interesting. Within a short time many important points have been made by hon. Members on both sides of the House. In the 15 minutes left to me, it will obviously be impossibl to reply to all of them, and so I hope that hon. Members-will understand if I do not try to do so. However, I shall certainly try to respond in writing to any points that I cannot touch on now.
  We welcome the use that the Liberal party has made of its Opposition day, particularly as it gives us the opportunity to set the record straight. Since 1979, we have had a proud and creditable record of caring for the elderly. The debate gives us an opportunity, however, to shed yet more light on the important and exciting proposals introduced on Monday by my right hon. Friend the Secretary of State in his social security review. But given the opportunity that the Liberals had, it is surprising that they should have decided to focus on such a subject, especially when one considers their record and their collaboration in keeping the Labour Government in office through the notorious Lib-Lab pact. I well understand that the hon. Member for Stockton, South (Mr. Wrigglesworth) is doubly responsible, because he was not then in the SDP; he had not forsaken his allegiance to the Labour party. But it is important that people should be reminded again and again of the dangers of inflation. Those dangers apply to everyone, but particularly to the elderly. A party that collaborated with another party that

  491
  succeeded in achieving an inflation rate of 112 per cent. over five and a bit years has much to answer for to the elderly.
  Mr. Steel: I do not wish to lessen the time available to the Minister, but he must recall that during the 18 months of the Lib-Lab pact inflation was reduced from 20 per cent. to 8 per cent.
  Mr. Whitney: I should point out that the hon. Member for Stockton, South was quite happy with the deal when the change from the method of accounting in effect denied over £1 billion in today's terms to this country's pensioners.
  My right hon. Friend the Minister has already responded to most of the points raised by the leader of the Liberal party, but he has left me to comment on the personal social services. It is important to put the Government's achievements on the record. I agree with the right hon. Gentleman that the personal social services are a vital element in the Government's aid to the elderly, and that is why we take great pride in the fact that between 1979–80 and 1983–4 expenditure increased, in real terms, by 18 per cent. For example, net expenditure on local authority residential homes amounted to something approaching £365 million in 1983–84, an increase of about 12 per cent. I could go through the list, and I should be happy to write to the right hon. Member to explain still further the significant increases that have taken place in this sector, which he recognises as important.
  Mrs. Beckett: As this is the second time that Conservative Members have taken credit for the Government's record in social services, I should remind them that most of that record comes from the spending of Labour councils, for which they have been criticised. The Conservative councils have a pretty rotten record.
  Mr. Whitney: If the hon. Lady looks at the facts, she will understand that that is not the case, but I hope that she will not object to the fact that spending has increased by 18 per cent. in real terms. Therefore, it is a little puzzling to know why — except for the right hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) who seems to have some understanding of the impact of inflation on the pensioners—hon. Members are constantly pressing us for yet more.
  When we talk about pensions, what is referred to as the alliance becomes an even more puzzling creature than it usually is—it is more like a hydra-headed amoeba than an alliance, and most of the heads are quite small. In the Liberal party's response to my right hon. Friend's pension inquiry, it suggested that the target should be to raise the basic pension of a married couple to two thirds the average male earnings. The cost of that would be about£10 billion. It would increase the load of national insurance contributions on employer and employee by about 50 per cent. I wonder whether either pensioners or the working population have any concept of what that Liberal party proposal would mean both for employment and the national economy.
  I understand that there are two separate parties within the alliance, but the puzzle is that there seem to be two parties within the SDP. We were pleased to notice that the SDP spokesman in the other place, Lord Roberthall, recognised the tremendous subject that had been opened up. He said that he wanted
  492
  "to congratulate the Government on grasping this nettle at last, which is so full of promise.
  I think that most important in what the noble Baroness has said is the reference to the problems of the future I think our grandchildren are living in a fool's paradise, because the rapid change in the age structure"—
  Mr. Speaker: Order. I am reluctant to stop the hon. Gentleman, but I trust that he is not quoting a Member of the other place.
  Mr. Whitney: I apologise, Mr. Speaker. I was seeking to paraphrase but it became something more than that.
  The noble Lord was pointing out the dangers of living in a fool's paradise because the rapid change in the age structure means, as was pointed out earlier, a much smaller number of workers having to pay for a larger number of pensions. It is with that problem that we sought to deal through the proposals that we have made on the phasing out of SERPS.
  I am happy to deal with some of the points that the hon. Member for Derby, South (Mrs. Beckett) made because clearly she has failed to understand the impact of our present economic commitments. It is necessary for any sensible Government, as has been widely recognised, to take a careful look at these obligations. The assumptions to which the hon. Lady referred showed a wide variation, but the arguments do not rest on these assumptions alone. If SERPS were to continue unchecked, that would earmark a large slice of public expenditure, and not necessarily direct it where it is most needed Part of the cost of SERPS would go to boosting occupational pensions, and the central question is not whether we can afford SERPS, but whether the state should be in the business of providing' second tier pensions.
  Mr. Steen: I do not wish to disturb my hon. Friend's recitative, but will he deal with the point — [Interruption.] If my hon. Friend can hear me above the Liberal party's bad behaviour and rabble-rousing, will he direct his mind to my idea that the Government could save quite a bit of money and do a lot of good in developing family and community care by encouraging elderly people to live at home and giving the people with whom they live tax concessions and benefits?
  Mr. Whitney: I recognise that as an objective, and some of the moves that the Government have made suggest that we are moving in that direction. I am seeking for the figures, which I cannot find, but the community programme that we have already suggests that we are moving in the right direction and that we recognise the importance of that.
  I hope that my hon. Friend will recognise as well that a balance has to be struck. For example, the extension of the invalid care allowance, as my hon. Friend the Minister for Social Security has made clear on a number of occasions, is regarded as one of many desirable objectives. However, the problems of the Government as opposed to those of the SDP or the Liberal or Labour parties is that we have to have the responsibility of making choices. We understand the dangers of inflation, not least to retired people.
  The hon. Member for Derby, South made an interesting claim about the importance of Beveridge. I think that she was seeking for the quotation:
  "From each according to his abilities, to each according to his needs."

  493
  However, she seems to be opposed to any proposal that we
  are making within the review to target more effectively the
  available resources. If she would think a little more
  carefully about
  "to each according to his needs";
  she would see that better targeting, which is promised in
  the review, will achieve exactly that.
  I am seeking to answer as many as I can of the important points that have been made, but it will be difficult for me to cover them all in the available time. The hon. Member for Ross, Cromarty and Skye spoke about the need for integration of taxes and benefits, and we recognise that as a desirable objective in many ways. However, there are serious problems, with which my right hon. Friend the Chancellor of the Exchequer is looking forward to dealing.
  There has been much talk of Beveridge and I refer hon. Members and particularly the right hon. Member for Tweeddale, Ettrick and Lauderdale to what Sir William Beveridge, himself a Liberal, said:
  "The State in organising security should not stifle incentive, opportunity, responsibility; in establishing a national minimum, should leave room and encouragement for voluntary action by each individual to provide more than that minimum for himself and his family."
  Those are the objectives that my right hon. Friend the Secretary of State's review will achieve.
  Question put, That the original words stand part of the Question:—
  The House divided: Ayes 156, Noes 267.

  Division No. 230]

  [7 pm

  .AYES

  Alton, David

  Cox, Thomas (Tooting)

  Anderson, Donald

  Craigen, J. M.

  Archer, Rt Hon Peter

  Cunliffe, Lawrence

  Ashdown, Paddy

  Dalyell, Tam

  Ashley, Rt Hon Jack

  Davies, Rt Hon Denzil (L'lli)

  Atkinson, N. (Tottenham)

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

  Banks, Tony (Newham NW)

  Dewar, Donald

  Barnett, Guy

  Dobson, Frank

  Barron, Kevin

  Dormand, Jack

  Beckett, Mrs Margaret

  Dubs, Alfred

  Bell, Stuart

  Dunwoody, Hon Mrs G.

  Benn, Tony

  Eadie, Alex

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

  Edwards, Bob (Wh'mpt'n SE)

  Bermingham, Gerald

  Evans, John (St, Helens N)

  Blair, Anthony

  Fatchett, Derek

  Boyes, Roland

  Field, Frank (Birkenhead)

  Bray, Dr Jeremy

  Fields, T. (L'pool Broad Gn)

  Brown, Gordon (D'f'mline E)

  Foot, Rt Hon Michael

  Brown, Hugh D. (Provan)

  Forrester, John

  Brown, N. (N'c'tle—u—Tyne E)

  Foster, Derek

  Bruce, Malcolm

  Foulkes, George

  Buchan, Norman

  Fraser, J. (Norwood)

  Callaghan, Rt Hon J.

  Freeson, Rt Hon Reginald

  Callaghan, Jim (Heyw'd & M)

  Freud, Clement

  Campbell—Savours, Dale

  Hamilton, James (M'well N)

  Canavan, Dennis

  Hamilton, W. W. (Central Fife)

  Carlile, Alexander (Montg'y)

  Hancock, Mr. Michael

  Clark, Dr David (S Shields)

  Hardy, Peter

  Clarke, Thomas

  Harman, Ms Harriet

  Clay, Robert

  Harrison, Rt Hon Walter

  Clwyd, Mrs Ann

  Hattersley, Rt Hon Roy

  Cocks, Rt Hon M. (Bristol S.)

  Haynes, Frank

  Cohen, Harry

  Heffer, Eric S.

  Coleman, Donald

  Hogg, N. (C'nauld & Kilsyth)

  Concannon, Rt Hon J. D.

  Holland, Stuart (Vauxhall)

  Conlan, Bernard

  Home Robertson, John

  Cook, Frank (Stockton North)

  Howell, Rt Hon D. (S'heath)

  Corbett, Robin

  Howells, Geraint

  Cowans, Harry

  Hoyle, Douglas

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  Hughes, Roy (Newport East)

  Pavitt, Laurie

  Hughes, Sean (Knowsley S)

  Penhaligon, David

  Hughes, Simon (Southwark)

  Pike, Peter

  Hume, John

  Powell, Raymond (Ogmore)

  Janner, Hon Greville

  Prescott, John

  Jenkins, Rt Hon Roy (Hillh'd)

  Randall, Stuart

  John, Brynmor

  Richardson, Ms Jo

  Johnston, Russell

  Robertson, George

  Jones, Barry (Alyn & Deeside)

  Robinson, G. (Coventry NW)

  Kaufman, Rt Hon Gerald

  Rowlands, Ted

  Kennedy, Charlesv

  Shore, Rt Hon Peter

  Kilroy—Silk, Robert

  Short, Ms Clare (Ladywood)

  Kirkwood, Archy

  Silkin, Rt Hon J.

  Lamond, James

  Skinner, Dennis

  Leadbitter, Ted

  Smith, Cyril (Rochdale)

  Lewis, Ron (Carlisle)

  Snape, Peter

  Lewis, Terence (Worsley)

  Soley, Clive

  Lofthouse, Geoffrey

  Spearing, Nigel

  McCartney, Hugh

  Steel, Rt Hon David

  McCrea, Rev William

  Stewart, Rt Hon D. (W Isles)

  McDonald, Dr Oonagh

  Strang, Gavin

  McKay, Allen (Penistone)

  Straw, Jack

  McKelvey, William

  Thomas, Dafydd (Merioneth)

  MacKenzie, Rt Hon Gregor

  Thompson, J. (Wansbeck)

  McTaggart, Robert

  Tinn, James

  Madden, Max

  Torney, Tom

  Marek, DrJohn

  Wallace, James

  Martin, Michael

  Warden, Gareth (Gower)

  Maxton, John

  Wareing, Robert

  Maynard, Miss Joan

  Weetch, Ken

  Meacher, Michael

  Welsh, Michael

  Meadowcroft, Michael

  Wigley, Dafydd

  Mikardo, Ian

  Williams, Rt Hon A.

  Millan, Rt Hon Bruce

  Wilson, Gordon

  Morris, Rt Hon J. (Aberavon)

  Woodall, Alec

  Nellist, David

  Wrigglesworth, Ian

  Oakes, Rt Hon Gordon

  O'Neill, Martin

  Tellers for the Ayes:

  Orme, Rt Hon Stanley

  Mr. A. J. Beith and

  Paisley, Rev Ian

  Mr. John Cartwright.

  Patchett, Terry

  NOES

  Aitken, Jonathan

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

  Alexander, Richard

  Clark, Dr Michael (Rochford)

  Alison, Rt Hon Michael

  Clarke, Rt Hon K. (Rushcliffe)

  Amess, David

  Clegg, Sir Walter

  Ancram, Michael

  Colvin, Michael

  Arnold, Tom

  Conway, Derek

  Ashby, David

  Coombs, Simon

  Baker, Nicholas (N Dorset)

  Cope, John

  Baldry, Tony

  Cormack, Patrick

  Batiste, Spencer

  Cranborne, Viscount

  Beggs, Roy

  Critchley, Julian

  Bellingham, Henry

  Crouch, David

  Bendall, Vivian

  Dickens, Geoffrey

  Benyon, William

  Dorrell, Stephen

  Biffen, Rt Hon John

  Douglas—Hamilton, Lord J.

  Biggs—Davison, Sir John

  Dunn, Robert

  Blackburn, John

  Durant, Tony

  Blaker, Rt Hon Sir Peter

  Edwards, Rt Hon N. (P'broke)

  Boscawen, Hon Robert

  Eggar, Tim

  Bottomley, Mrs Virginia

  Emery, Sir Peter

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

  Evennett, David

  Bowden, Gerald (Dulwich)

  Fallon, Michael

  Bright, Graham

  Favell, Anthony

  Brinton, Tim

  Fletcher, Alexander

  Brown, M. (Brigg & Cl'thpes)

  Fookes, Miss Janet

  Bruinvels, Peter

  Forsyth, Michael (Stirling)

  Buck, Sir Antony

  Forth, Eric

  Burt, Alistair

  Fowler, Rt Hon Norman

  Butcher, John

  Fox, Marcus

  Butler, Hon Adam

  Franks, Cecil

  Butterfill, John

  Fraser, Peter (Angus East)

  Carlisle, John (N Luton)

  Freeman, Roger

  Carlisle, Kenneth (Lincoln)

  Gale, Roger

  Cash, William

  Galley, Roy

  Chalker, Mrs Lynda

  Gardiner, George (Reigate)

  Channon, Rt Hon Paul

  Gilmour, Rt Hon Sir Ian

  Chope, Christopher

  Goodhart, Sir Philip

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  Gorst, John

  Lawler, Geoffrey

  Gow, Ian

  Lawrence, Ivan

  Greenway, Harry

  Lee, John (Pendle)

  Gregory, Conal

  Lennox—Boyd, Hon Mark

  Griffiths, Peter (Portsm'th N)

  Lester, Jim

  Ground, Patrick

  Lilley, Peter

  Grylls, Michael

  Lloyd, Ian (Havant)

  Hamilton, Hon A. (Epsom)

  Lloyd, Peter, (Fareham)

  Hamilton, Neil (Tatton)

  Luce, Richard

  Hampson, Dr Keith

  McCrindle, Robert

  Hanley, Jeremy

  MacKay, Andrew (Berkshire)

  Hannam, John

  MacKay, John (Argyll & Bute)

  Hargreaves, Kenneth

  Major, John

  Harris, David

  Maples, John

  Harvey, Robert

  Mather, Carol

  Haselhurst, Alan

  Mawhinney, Dr Brian

  Hawkins, Sir Paul (SW N'folk)

  Maxwell—Hyslop, Robin

  Hawksley, Warren

  Mayhew, Sir Patrick

  Hayes, J.

  Mellor, David

  Hayward, Robert

  Montgomery, Sir Fergus

  Heddle, John

  Moore, John

  Henderson, Barry

  Morrison, Hon C. (Devizes)

  Hickmet, Richard

  Morrison, Hon P. (Chester)

  Hind, Kenneth

  Murphy, Christopher

  Hirst, Michael

  Nelson, Anthony

  Hogg, Hon Douglas (Gr'th'm)

  Newton, Tony

  Holland, Sir Philip (Gedling)

  Nicholls, Patrick

  Holt, Richard

  Onslow, Cranley

  Howarth, Alan (Stratf'd—on—A)

  Page, Richard (Herts SW)

  Howarth, Gerald (Cannock)

  Patten, J. (Oxf W & Abdgn)

  Hubbard—Miles, Peter

  Percival, Rt Hon Sir Ian

  Hunt, John (Ravensbourne)

  Pollock, Alexander

  Hunter, Andrew

  Powell, William (Corby)

  Jackson, Robert

  Powley, John

  Jessel, Toby

  Proctor, K. Harvey

  Johnson Smith, Sir Geoffrey

  Raison, Rt Hon Timothy

  Jones, Gwilym (Cardiff N)

  Renton, Tim

  Kellett—Bowman, Mrs Elaine

  Rhodes James, Robert

  Kershaw, Sir Anthony

  Robinson, Mark (N'port W)

  King, Rt Hon Tom

  Roe, Mrs Marion

  Knight, Gregory (Derby N)

  Ross, Wm. (Londonderry)

  Knight, Mrs Jill (Edgbaston)

  Ryder, Richard

  Knox, David

  Sackville, Hon Thomas

  Lamont, Norman

  Sainsbury, Hon Timothy

  Lang, Ian

  Sayeed, Jonathan

  Latham, Michael

  Shaw, Sir Michael (Scarb')

  496

  Shelton, William (Streatham)

  Twinn, Dr Ian

  Shepherd, Colin (Hereford)

  Vaughan, Sir Gerard

  Shepherd, Richard (A/dridge)

  Viggers, Peter

  Shersby, Michael

  Waddington, David

  Silvester, Fred

  Wakeham, Rt Hon John

  Sims, Roger

  Walden, George

  Skeet, T. H. H

  Walker, Cecil (Belfast N)

  Smith, Tim (Beaconsfield)

  Walker, Bill (T'side N)

  Spencer, Derek

  Waller, Gary

  Spicer, Jim (W Dorset)

  Ward, John

  Stanbrook, Ivor

  Wardle, C. (Bexhill)

  Steen, Anthony

  Warren, Kenneth

  Stern, Michael

  Watson, John

  Stevens, Lewis (Nuneaton)

  Watts, John

  Stevens, Martin (Fulham)

  Wells, Bowen (Hertford)

  Stewart, Andrew (Sherwood)

  Wheeler, John

  Stradling Thomas, J.

  Whitney, Raymond

  Sumberg, David

  Wiggin, Jerry

  Taylor, John (Solihull)

  Winterton, Mrs Ann

  Taylor, Teddy (S'end E)

  Winterton, Nicholas

  Terlezki, Stefan

  Wolfson, Mark

  Thomas, Rt Hon Peter

  Wood, Timothy

  Thompson, Donald (Ca/der V)

  Yeo, Tim

  Thompson, Patrick (N'lch N)

  Young, Sir George (Acton)

  Thornton, Malcolm

  Thurnham, Peter

  Tellers for the Noes:

  Townsend, Cyril D. (B'heath)

  Mr. Tristan Garel—Jones and

  Tracey, Richard

  Mr. Michael Neubert.

  Question accordingly negatived.
  Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 33 (Questions on amendments), and agreed to.
  MR. SPEAKER forthwith declared the main Question, as amended, to be agreed to.
  Resolved.,
  That this House recognises the Government's achievement in increasing the value of the retirement pension and welcomes, the Government's continued commitment to protect its value, congratulates the Government on carrying out a thorough review of the social security system, and endorses the aim of ensuring a coherent and soundly based benefit structure to meet the needs of pensioners and others.

  Wages Councils
  7.12 pm
  Mr. David Penhaligon: I beg to move,
  That this House agrees with the conclusion of the
  Employment Committee that wages councils should not be
  abolished.
  Mr. Speaker: I have selected the amendment in the name of the Prime Minister.
  Mr. Penhaligon: The legislation on wages councils is of some maturity. It dates back to 1909, which shows a level of endurance, and, I believe, a civilisation by Parliament. We believe that the legislation enshrined in the law the concept that within our capitalist, entrepreneurial society there will be a level beyond which people will not be exploited. That was fundamental to the argument in 1909, and it is fundamental to the argument that I wish to present today. That argument was good enough for the House in the 1920s, 1930s, 1940s, 1950s, 1960s, and 1970s, but today we live in a different era. Even such basic concepts as that have to be argued and fought for.
  In principle, the wages councils set for several categories of employees minimum rates of pay and minimum employment conditions that should be obeyed. Most of the regulations insist upon adult pay rates of about £65 to £72 a week. A single person receiving that would have a take-home pay of £61 a week and a married man £65 a week. The average for the whole lot is just short of £70 a week.
  The issue whether we should abolish or reform has, in one form or another, been the subject of political debate and argument for a least two or three years. The Government played with it under pressure from their own Back Benches, and eventually produced a consultative document, which comes up with the alternatives of abolish or reform. Everyone in the House knows what abolition means; that is a simple state to deal with. However, reform can mean anything. It can mean virtual abolition. At the same time, it can mean a great extension and strengthening, so I suppose that the optimist in me must say that there is at least some hope for a civilisation on this issue.
  Several arguments are paraded in favour of abolition. The favourite one, in the era in which we live, is not surprising—it is jobs. Various documents and economic theories suggest that if there were a 1 per cent. reduction in average pay that would create up to about 150,000 jobs. Therefore, one does not lightly dismiss arguments in this area. It is worth remembering relative to the figures of £65 to £72 a week that average pay is currently £178 a week. My hon. Friends and I believe that some wage settlements currently being made mitigate against the national recovery, and certainly against a reduction in unemployment. That is my honest, candid view. However, those pay increases are in the higher categories. They are not for the people earning the income that I have mentioned. We believe that if one extrapolates that basic argument, in which there is some truth, to this category, it is standing all logic on its head, and possibly putting several people in a position that we find unacceptable.
  As I have said, we do not dismiss the possibility that there is some substance in the argument to which I have just referred. However, we find little evidence that
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  reducing wage rates from between £65 and £72 a week to between £55 and £62 a week would create a significant number of extra new jobs. The best estimate that I can find is that if the wages councils were abolished 8,000 jobs would be produced. To put it in perspective, that is fewer than 16 jobs per constituency. Average unemployment is now over 5,000 per constituency. Even if that figure underestimated reality by a factor of two, 32 jobs relative to 5,000 is of very little significance.
  Mr. Dave Nellist: Is the hon. Gentleman aware that the Department of Employment has given me the following figures in relation to the average wages of young people, at whom is often aimed the assertion that if their wages were reduced more jobs could be created? The average wage for school leavers relative to adult rates has fallen by 8 per cent. for boys and 12 per cent. for girls during the lifetime of this Government, yet youth unemployment has trebled. In other words, the evidence from the Department showing falling wage rates has shown no increase in employment but a trebling of unemployment.
  Mr. Penhaligon: I have seen those figures before somewhere. It might be because the hon. Gentleman produced them. I shall refer to youth pay. I do not totally dismiss what the hon. Gentleman says.
  A few people believe that the abolition of wages councils would allow pay to increase. I have heard few hon. Members argue that in the House. I do not know whether that is the view of the Minister or his Department. I regard it as fantasy of the first order.
  Let us ask ourselves what would happen if wages councils were abolished. What evidence can one produce? The truth is that little can be produced. I believe that their abolition would reduce pay. Many low-paid jobs are already not covered by wages councils. One can examine the pay structure in that area and judge what might happen in similar jobs that happen to be inside wages councils. Let me give the Minister an example. In my constituency, a young woman who is a qualified florist came to see me. She had been through the course to become a florist, and was highly regarded in that skill. Her employment boiled down to preparing wreaths and sprays and making the flowers that are grown in my part of the country, among others, into a more attractive item to persuade people to part with their money. In another part of the same enterprise. a young woman of similar age works behind the counter of the shop.
  Reason suggests that the person behind the scenes doing the skilled work should be paid more than the person behind the counter taking the orders, but that is not so because the young woman on the counter is defended by the wages council to the tune of £67 to £72 per week whereas the other is not. I believe that if wages councils were abolished many more people would be in the position of the qualified florist who is paid less than her colleague at the counter.
  Mr. John Butterfill: I believe that 17 wages councils have been abolished since 1960. Can the hon. Gentleman give evidence to show that wages in those industries have been reduced?
  Mr. Penhaligon: One of the wages councils that were abolished protected the minimum pay of whalebone corset manufacturers. From observation in my constituency and

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  in the House, I suspect that the outlet for those products is somewhat limited nowadays, so the three people still making them may well be paid less than in the past.
  Mr. Tony Baldry: The wages council for the cutlery industry was abolished in 1969.
  Mr. John Evans: Why was it abolished?
  Mr.Baldry: It was abolished because it was thought that under the legislation collective bargaining was adequate to protect the employees in that industry, but research by the Department of Employment into the impact of abolition concluded that there had been no significant improvement in wage determination, no catching up with the rates achieved by voluntary collective bargaining in similar industries and, indeed, sufficient evidence of underpayment of female workers to suggest that protection had deterioriated since abolition.
  Mr.Deputy Speaker(Mr.Ernest Armstrong):
  Order. There are three Front-Bench speakers in this short debate and a number of other hon. Members wish to catch my eye. Interventions from Members waiting to catch my eye do not improve their chances of doing so.
  Mr. Penhaligon: One likes to encourage maximum participation on these occasions, but I think that there have been five speeches so far, and I note your comment, Mr. Deputy Speaker.
  Another example of which I have experience is the village sub-post office with a retailing business attached. If an employee's duties include the selling of Mars bars and the like, that person is defended by a wages council to the tune of £67 to £72 per week; but the person employed only behind the post office counter dealing with large amounts of state money in pensions and benefits is not protected and in many cases the wages are lower. There are many other examples. I know of tyre fitters being paid between £45 and £50 per week.
  It may be argued that these are fringe examples and that hard cases make bad law, but I argue that they are not fringe cases. The Minister's own document states that of the 2·7 million people covered by wages councils about 1 million earn the wages council minimum or just a pittance more, so all those people are influenced by wages council settlements. With regard to the impact on employment, subparagraph 8 of the Government document states that
  "those figures suggest that the wages council rates are now higher than would be necessary to recruit and retain workers."
  That is the Government's own view, and I agree with it entirely. There is thus no argument between us and the Minister — there may be some argument from Conservative Back Benchers, although not from the hon. Member for Banbury (Mr. Baldry)—that the abolition of wages councils will do anything other than reduce wages. In this context, I remind the House that we are talking about minimum wages of £67 to £72 per week.
  There are a couple of documents supporting abolition. The document submitted by the Institute of Directors advocates outright abolition. I put some energy into trying to discover any categorisation of directors' pay in the new earnings survey but was unable to do so. I suspect, however, that their earnings are nearer £70 per day than £70 per week. The institute baldly states that 54 per cent. of its members believe that they would employ more people if wages councils were abolished.
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  One does not simply dismiss evidence of that calibre, so let us consider the way in which that magnificent figure was produced. Of the 2,000 members of the institute consulted about the Government's document relating to abolition, only 130 responded, 30 per cent, of whom said they had no experience and therefore no knowledge of this area and thus had no strong view one way or the other. The great Institute of Directors survey thus comes down to just 91 people's responses, 70 of whom said that they might take on more staff. That is 3½£ per cent. of the institute's membership, not the 54 per cent. suggested on the front page of the submission.
  That is a disgracefully shoddy piece of work by a body which, on the whole, one respects and it shows no interest in or understanding of the circumstances that we are discussing. If the business decisions of members of the Institute of Directors are based on such flimsy evidence, it is no wonder that Britain is in trouble. Some of them should try living on £70 per week rather than £70 per day.
  The other substantial body in favour of abolition is the National Federation of Self-Employed and Small Businesses, which tends to major on the complexity of some wages council regulations. Paragraph 12 of the Government document refers to a set of wages council regulations comprising 30 pages of closely typed instructions, and the wages inspectorate concluded that half the underpayments discovered in its random survey —not its detailed survey—were due more to ignorance than to malice, and that is the wages councils' own view. That suggests that there is room for simplification, so I do not defend every detail of the present situation.
  The wages councils' own evidence states that 35 per cent. of visits found evidence of underpayment That figure contrasts with the 6 per cent. found in the random survey, but visits occur largely when problems have been brought to the attention of a wages council by employees, other employers or, no doubt, Members of Parliameni. I make no complaint about that. One recognises that the sample for visits is skewed and I do not know whether the figures are exactly 35 per cent. or 6 per cent., but let us take the 6 per cent. It shows beyond question that the current regulations are more complicated than they need be. Therefore, some simplification may be suitable.
  Some of the members of the National Federation of Self-Employed and Small Businesses to whom I talk are aware that, in many cases, the wages councils protect them. If, for example, business A is offering the community a service and paying its employees £70 a week, and business B comes along to compete and pays its employees £50 a week, I have news for the owner of business A: he is likely to be in some difficulty fairly soon. Many people recognise that, at the end of the economy, wages councils operate to their advantage.
  Some of those who claim that they could produce extra jobs if wages councils were abolished seem to base that suggestion on their ability to undercut their compelitors. They say, "If I pay my employees £60 a week, I can employ more, because I will undercut the man up the road and grab some of his business." The employer up the road is likely to hit back in the obvious way. Therefore, I believe that few jobs will be created by the abolition of the wages councils.
  The major complaint is about wages for the young. I note that all the categories of business pay what is called in the document the adult rate at the age of 18, excent for the boot and shoe repair industry, which pays it at 20; the

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  hairdressing industry, which pays it at 20; the retail food trade, which pays it at 19; and the sack and bag industry, which also pays it at 19. Logic suggests that if an employer is given a choice between employing a 28-year-old with eight or 10 years' experience, and an 18-year-old with only one or two years' experience, at the same rate of pay, regardless of all the surveys and the comments of the philosophers who analyse such matters, the 28-year-old stands a better chance of getting a job.
  Part of the problem is that we define adulthood legally as the age of 18, but an 18-year-old is not always trained and experienced. In other European countries, the main rate recommended by minimum wage legislation — Britain is by no means unique in having such legislation is paid only to older people. For example, in
  Denmark, the consolidated rate is paid at the age of 23.
  I believe that that is too old, and would suggest 21 as the
  most suitable age. However, I warn the House that
  changes in this area will not create more jobs. All that will
  happen is the substitution of mature workers by younger
  workers, but there is some justification for arguing that the
  system should be changed. In some areas, the consolidated
  →or experienced—rate should apply to 21-year-olds,
  not to 18 or 19-year-olds.
  Some believe that the Government will abolish all protection for those aged under 21. That would go tragically too far. The justification for this legislation is that it protects the vulnerable in society, and we all know that probably the most vulnerable section of society is the under-21s. It stands logic on its head to abolish protection for them. Furthermore, if protection is removed completely, when many people reach the age of 21 they will be sacked. Hon. Members should realise that some people suddenly lose their jobs simply because they have moved up a bracket in the pay range. I beg the Secretary of State not to introduce as a compromise the scrapping of regulations governing employees aged under 21.
  Mr. Baldry: What proportion of the adult rate would the hon. Gentleman suggest those aged between 16 and 21 should get? At present, 22 of the 26 wages councils pay a disproportionately higher rate to young people than 16-year-olds receive elsewhere in the economy.
  Mr. Penhaligon: I have made it clear that there is some necessity for movement in that area. I do not dodge the hon. Gentleman's question. However, he cannot expect me to come up with a figure for wages should the basic regulations be changed. That is a matter for negotiation by the wages councils within their spheres of influence. But if the House says that it wishes the consolidated rate to operate from the age of 21, I believe that action would be taken to implement it.
  The Secretary of State produced a consultative document mainly to try to quell the hard core on the Conservative Back Benches. He knows already that the Select Committee on Employment is against total abolition. The Auld report, at page 66, came out firmly against abolition of the wages councils. The CBI is against it. One is not surprised, but one does not dismiss it for that, that the Low Pay Unit and the Child Poverty Action Group are against it. The Labour party, the Liberal party, the Social Democratic party and the nationalist parties are all against total abolition. The citizens' advice bureaux are certainly against abolition, and they have day-to-day
  502 experience of dealing with the problems that arise in this area. The British Institute of Management is against abolition.
  There could be a much more intelligent debate on the subject if the Government accepted the Liberal motion, which is simplicity itself. Let us make it clear that total abolition is not an option, and that doing nothing is not an option. Between those two extremes, we could have a much more sane, sensible and civilised debate. We believe that there is a case for simplification, and that not all workers are experienced and mature at the age of 19, but that there is no case for abolition. Indeed, it may be worth considering an improvement in the endorsement procedure in some areas.
  The Liberal party has used one of its rare Supply days to raise this subject because it believes that the Parliament of our capitalist, competititive society should send out the clear message that there is a point beyond which people shall not be exploited. The miserable wages that we are defending range between £65 and £72 a week. The alliance is defending that, but the Government, by issuing their consultation paper, are attacking it, or at least putting it under scrutiny. The Secretary of State probably agrees with much of what I said, but some of the hard men on the Conservative Back Benches will have different views.
  This legislation was good from the 1920s to the 1970s. It is a reflection on our Government, on the era in which we live and on the ideas that are foisted upon the British people that we must spend parliamentary time defending such miserable wages. I invite the House to vote for our motion and to clear up this matter once and for all.
  7.38 pm
  The Secretary of State for Employment (Mr. Tom King): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
  'notes that the period for consultation on the consultative document on wages councils is only just ending and representations are still being received; and asks the Government to take into account the views of the Employment Committee, together w ith the very many other responses from interested organisations and individuals.'.
  The Government's amendment makes it clear why we cannot accept the motion introduced by the hon. Member for Truro (Mr. Penhaligon). We do not intend to set aside, at the moment of their reception, the many representations and comments that have been made in response to our consultative document. Despite the hyperbole of his peroration, the hon. Gentleman must realise that it would be a disgrace for the House—I hope that the Liberal party would have nothing to do with it—to treat with contempt the representations of people who are informed and involved. They will certainly be considered by the Government, although the hon. Gentleman seems to be prepared to ignore them.
  The hon. Gentleman knows that 31 May was the date set for the end of the consultation period. We are just ending that consultation period, and six further serious representations were made today. They are still coming in, and I am sure that the House would wish us to continue to consider all the representations that can be taken into account, even if, technically, they fall just outside the deadline. I hope that all those who believe in a serious consultation of this nature will support our amendment and realise that that must be the right way to proceed.
  As I have said, we are still receiving a massive number of representations. The lunch-time score today was 667.

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  I therefore welcome the opportunity provided by this debate for the House to make its comments, and I shall certainly take note of them.
  I apologise for the fact that there has been a discontinuity of Ministers. There was a debate in the early hours of the morning during the proceedings on the Consolidated Fund, but at present my hon. Friend the Parliamentary Under-Secretary is attending a meeting of the ILO in Geneva. I hope, therefore, that the House will accept me as an inadequate substitute for him on this occasion.
  The House will recall the background to the consultative document. It was originally announced in the Budget speech as part of a range of measures specifically targeted towards the issue of unemployment. It will also be recalled that in the Budget debate the Chancellor and I announced a series of measures, including the development of the two-year youth training scheme, the expansion of a further 100,000 places in the community programme to help the long-term unemployed and new pilot projects as a means of providing further valuable work for the long-term unemployed. They include schemes managed by the private sector and those that involve work in charities.
  We also looked at ways in which we could remove any obstacles to the creation of the maximum number of jobs. In that connection, there was a general welcome in the House for the proposals to reduce the starting rate for national insurance contributions at the lower level as a means of reducing the cost of taking on new employees. In addition, we have tried to ease the burden or remove any obstacle which might exist in relation to employment protection. That has already been carried through. We also identified the problem of the wages councils. As a result, I announced our proposals and published a consultative paper.
  In the Budget debate I set out the reasons why the Government believed that the changes were needed. As we know, wages councils specify rates of pay and detailed conditions for 2·75 million workers in 26 industries. The hon. Member for Truro said that the system was first introduced in 1909, against a background of much public concern about "sweating", the three components of which were inadequate wage rates, excessive hours of labour and the insanitary state of the houses in which the work was carried out. That was the background against which the original trade boards were established.
  However, economic conditions have changed sig-nificantly since that time. The welfare state has been established, real average pay is much higher and average hours of work are much lower. There is now an extensive range of legislation aimed at protecting the welfare and health and safety of employees. The development of systems for family support—and the further developments announced by my right hon. Friend the Secretary of State for Social Services are relevant in that regard— has made a significant new impact on the situation.
  I have said that one of the original concerns was the extremely long hours of work, but it is worth remembering that two thirds of the employees covered by wages councils are part-time workers. A significant number produce a second family income, paniclarly women who work part-time and represent a significant number of those covered by wages councils.
  The system has developed piecemeal and is extremely uneven in its application. I read with interest the article in
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  The Guardian by the right hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel), and it is without offence that I say that the speech of the hon. Member for Truro covered many of the points made in that article. However, I challenge hon. Members to walk down any high street in the country and to identify which shops are covered by wages councils and which are not. The application of wages councils is piecemeal, and it is extremely difficult to identify any great distinction between those for whom the wages councils are supposed to provide protection and those for whom they do not operate.
  Mr. Ray Powell: I am one of two elected Members who represent 400,000 shop workers. How many of them will not be covered if wages councils are abolished? Why are the Government not prepared to accept the Auld report's recommendation on the retention of the wages councils?
  Mr. King: I am, of course, aware of that relationship, and my right hon. and learned Friend the Home Secretary has already made our position clear. In advance of legislation on the Auld report, the Government recognise the need to make clear their position on wages councils As the hon. Gentleman rightly said, that was raised in the Auld report.
  Against that background, a range of complaints is widely recognised. One concern often expressed is the problem of the levels of pay of young people, and there is evidence that they are above the going rate that may exist in other industries. The mistake that was made by the hon. Member for Truro—it was a point in his right hon. Friend's article with which I disagreed—was to suggest that somehow there would be competition for a job between a 28-year-old at a fixed rate of pay and a 17-year-old at the same rate of pay. Instead, we should consider whether there is an alternative job at a lower rate of pay. I make no apology for saying that, because in Germany and other countries rates of between 30 and 40 per cent. of adult pay are considered reasonable as the starting rate. That gets more young people into jobs. However, so long as the adult rate is satisfactory, the problem of the starting rate for young people must be looked at very seriously. It should not just be considered in the context of substitution between the older and the younger person.
  Mrs. Jill Knight: Does my right hon. Friend also agree that people at that age and with such a short amount of experience cannot possibly be worth the amount which employers are asked to pay at that stage in their working lives? Is it not totally unrealistic to force an employer to pay more money than an employee is actually worth?
  Mr. John Prescott: Do not be so arrogant, you mean and silly woman.
  Mr. King: I am appalled by the reception giver to my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight). It is obvious that Opposition Members do not understand that in certain cases what she said is undoubtedly true. In certain cases, a 16-year-old is not worth £55 a week when starting out. I am anxious that youngsters should get training and jobs. It is acceptable to trade unions and all political parties in, for example, West Germany that youngsters should start on about £27 a week. Why is there much lower youth unemployment there?

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  Why do some people here, who are living in the past, insist on negotiating wages of £50 or £60 a week? By doing that, they are condemning a lot of young people to unemployment. I care about that and about a blinkered attitude which just shouts down a perfectly constructive comment.
  There are anxieties about the wages councils and about the complexity and length of the reports. The wages inspectors bear out the fact that many offences arise out of misunderstandings because of the length of the reports. Considerable difficulties have been caused by the practice of some wages councils of making retrospective awards. Employers suddenly discover that they have a bill for which they have not budgeted.
  As the hon. Member for Truro said, employment is at the heart of this debate. We put employment at the top of our list of priorities. Every responsible right hon. and hon. Member must take that view. We have decided that there is an urgent need to tackle the problem of unemployment by abolition or reform of wages councils. We have had a staggering response to our consultation document. I do not wish to anticipate what conclusions we should draw, but I should like to give a summary of the responses. I acknowledge the response of the Select Committee on Employment and the minority report of my hon. Friend the Member for Bolton, North-East (Mr. Thurnham). We had 667 responses by lunch-time today, and they are still coming in.
  The Trades Union Congress and the unions have made clear their opposition to abolition, although some unions have joined the reform lobby because they think that simplification is important for more effective enforcement. Employers, the Institute of Directors and the National Federation of Self-Employed and Small Businesses obviously favour abolition. The Confederation of British Industry has suggested abolition, unless there is a request from both sides to retain wages councils, but maintains that there should nevertheless be radical simplification. The Association of British Chambers of Commerce wants radical reform. There is significant pressure in the hotel and catering industry for abolition. Organisations which advocate reform but not abolition have concentrated on issues mentioned in the consultation paper, such as the exclusion of young people, the setting of a percentage of the adult rate as a maximum, simplification involving a single rate for adults, amalgamations or reductions in the numbers of wages councils, and the elimination of retrospection and of independent members as a means of simplifying the operations of wages councils.
  Mr. Peter Thurnham: Has my right hon. Friend considered representations on behalf of the 3 million unemployed, because they suffer most from the effects of wages councils?
  Mr. King: It is precisely because of the potential for extra jobs that we are considering the matter. The consultation period is ending. We have received many representations and we are reviewing them, so the debate comes at an opportune moment.
  Mr. Michael Foot: As the right hon. Gentleman has attempted to give us some of the figures, will he tell us how many representations he has received in favour of outright abolition?
  Mr. King: I have only the figure of representations received—667 I have picked out a few views which are already public [HON MEMBERS "Ah1"] There IS no secret about this I shall be anxious to disclose the results of the consultation Representations are still coming in We have received six more today I do not have a breakdown, but the right hon Gentleman knows that the total includes representations from major institutions such as the CBI and the TUC We have had one representation from the alliance A Liberal councillor has written to us That is the only representation that we have had from the alliance so far, and I welcome it That is why the debate has been so valuable It is important to measure the merits or quality as well as the numbers of representations.
  I am sure that the House agrees that it is important to reach an early decision With the leave of the House, I shall respond to the debate In the meantime, I shall listen with interest.
  7 47 pm
  Ms. Clare ShortI should like to make clear the Labour party's opposition to the threatened abolition of wages councils We have outlined our stance in our amendment, which states that the Labour party
  "rejects the Government's claim that reducing the pay and conditions of low-paid workers will create more jobs, condemns the Government's deliberate weakening of the Wages Inspectorate by cutting their numbers by one-third — the Government are already undermining the system and now we are discussing whether it should be undermined further—"
  "thus encouraging bad employers to break the law"
  We hear much from the Government about law and order and respect for the law, but there are some laws such as those which are supposed to protect the wages of the lowest paid for which they have no respect As the motion continues, the Labour party
  "calls for the strengthening of wages councils to improve the protection of these workers, most of whom are women, young people and ethnic minorities "
  It was not clear whether the hon Member for Truro (Mr Penhaligon) spoke for the Liberal party or for the alliance, but the motion is enormously weak The Government have manipulated the press and public opinion time and again—then- method seems to work, although it is crude They always threaten more than they intend to do, and do less I do not believe that they intend to abolish all wages councils That would be too unpopular and they would pay too high a political price They intend to exempt major groups from their protection—young people and perhaps part-time women workers—and to undermine further the system which they have already weakened by cuts in the inspectorate It is clear from the consultative document that this is one possibility that the Government are considering The Liberal motion says-nothing about that, perhaps because of the difference on this question between the Liberal party and the Social Democratic party As usual, there seem to be grave differences between the two parties
  On 23 May 1985, writing in The Times, the leader of the Social Democratic party told us how new technology could lead to full employment and jobs for everyone—a thesis with which I agree He said that there is one grave threat to the possibility of the restoration of full employment, and that is that some of the new jobs will be low-paid jobs in the services sector He said:

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  "not all new jobs in the service sector will be high-skilled, high value-added, high-wage jobs. Along with the professional jobs and the jobs in IT will also be a lot of traditionally lower wage jobs in areas such as fast foods, retailing and health care.
  This has two critical policy implications. It is imperative not to prevent these jobs emerging by minimum wage legislation".
  There is minimum wage legislation in the wages council system. On 23 February, the leader of the Social Democratic party was not in favour of minimum wage legislation. I have always suspected that he makes up his party's policies in the bath and announces different policies depending upon how he feels.
  The National Union of Tailors and Garment Workers is deeply worried about the prospect of the abolition of wages councils. It represents workers in the textile industry who work in sweatshops— some of which are in my constituency—which are increasing in number. The union has sent us a letter that the leader of the Social Democratic party sent to one union member. On 22 May, the day before the article in The Times, the right hon. Gentleman seemed to be in favour of retaining wages councils but thought there might be scope for reform. He thought there should be less protection for school leavers and people with a second income. We know that he meant women but, just to show that the Social Democratic party favours sexual equality, the right hon. Gentleman referred to
  "perhaps the second wage earners in the family household— male or female—if wages were more flexible."
  Mr. Thurnham: May I help the hon. Lady with some comments on the Liberal party's views? She mentioned the garment industry. I think that she would accept that the wages of garment workers are determined by the world prices of their goods. The Liberal party has differing views on world prices — the hon. Member for Yeovil (Mr. Ashdown) says one thing about the multi-fibre agreement and the hon. Member for Rochdale (Mr. Smith) says the opposite.
  Ms. Short: I understand that the hon. Gentleman wants all controls to be abolished. I suppose that he wants Britain's textile workers to compete for wages with workers in Bangladesh.
  The leader of the Social Democratic party seems unable to make up his mind between one day and another whether he favours any minimum wage legislation. On Monday 3 June, in an article on the agenda page in The Guardian,as a trailer for this debate, the leader of the Liberal party tells us that we must retain and expand wages councils. A major difference between the views of the two parties is found in that statement. He stated:
  "there is definitely a case for saying that wages councils may"
  "may" is an interesting word—
  "deter some firms from taking on young people by insisting that they are paid the same £63–£72 per week as older employees." The right hon. Gentleman is mistaken in thinking that young people must be paid the adult rate. It seems that young people should be exempted from the protection offered by wages councils.
  The Government assert that the evidence suggests that abolition or major reform is needed. When the Government discuss reform in the consultative document, they mean further weakening of the wages council system. Let us be in no doubt about that. The Government assert that weakening the system or abolition will produce jobs. Despite enormous efforts by the Government to produce evidence to support this prejudiced and dogmatic view, as
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  Centre Forward calls it, the Government have failed to produce convincing evidence of this case The Select Committee's report shows that clearly, stating in paragraph 17:
  "Thus the empirical evidence submitted to the Select Committee does not provide unambiguous support for the notion that the elimination of Wages Councils would have the sort of employment effect which would provide an overwhelming case for abolition."
  In paragraph 19, the Select Committee states:
  "Ministers did not give an estimate of the increase in the number of jobs which might be expected to result from abol ition, when pressed to do so in respect of young people, they were unable to the message was try it and see'."
  Why do we not try it? Why do we not cut the wages le vels of people on £60 a week, just in case it will provide a few jobs? That is the proposition that is put before us.
  It is incredible how the Government have managed to make the senior Civil Service — an old part of the British establishment—so deviant that it constantly leaks documents One leaked document tells us something very interesting The Government have been trying to move in this direction since taking office in 1979 The Government keep commissioning research that does not prove their case If Ministers will not act as desired, it is a case of chuck them out, get new academics and Ministers and try again Here we are, the third time round In a minute dated 12 February 1981, Mr M Wake says that, in November 1980 — the Government got on to this matter quite quickly after 1979:
  "E(EA) Committee… accepted the Secretary of State s arguments for retaining the Wages Council system:"
  A report covered by the minutes states:
  "The mter-Departmental report by officials which was considered by Ministers at E(EA)"—
  that is a Cabinet employment sub-committee—
  "found no evidence of any significant loss of employment directly attributable to the setting up of minimum rates by wages councils."
  It seems that the Cabinet was persuaded Following that decision, the Secretary of State was asked to "examine whether it might be possible to remove young people and part-time workers from the scope of Wages Council awards The draft paper prepared for submission to that Cabinet sub-committee shows the conclusions of the review by the Secretary of State It states
  "The case for exclusion is based on the suggestion that job opportunities for young persons and part time workers would be increased if employers were free to take them on at less than the statutory minimum rates set by the wages councils When made, the suggestion usually comes from small shopkeepers."
  There are more and more of them in the House.
  "Exclusion of these groups has not been advocated by the employers' associations represented on the Councils (including those predominantly representing small businesses) although the National Federation of Self Employed and Small Businesses Ltd has recently urged the total abolition of the wages council system
  The facts are that statutory minimum rates for young pe sons and part timers are lower than comparable collectively barg lined rates, and rates actually paid frequently exceed the statutory minima In practice, therefore, there is unlikely to be any very significant scope generally for increasing job opportunities thereby To whatever extent this did happen, it would be largely at the expense of the jobs of full-time adult bread-winners'—
  that means throwing the parents out of work and giving the low paid work to their kids, this is the way in which we are going forward to Britain in the 1990s—
  "since there is no plausible evidence that it would significantly increase job opportunities overall in the wages council sectors "
  That Secretary of State — no longer a member of the Government—was asked to review the question whether

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  wage councils should be abolished. He reviewed an interdepartmental report and found that there was no case for abolition. The Cabinet committee accepted that. He was asked to look at the possibility of excluding young workers and part-time workers and found that there was absolutely no case for it. But he was thrown out, so here we are looking at it the second or third time round. The Government were determined. If the facts did not fit their prejudices, never mind, kick out the Minister and try again, commission more research and find some academics who will say the right thing.
  Yesterday the Low Pay Unit issued a briefing which makes very serious allegations about the way that the Department of Employment has been conducting its academic research. The briefing was prepared by Mr. Frank Wilkinson, a research economist at Cambridge university, who has carried out a number of research studies for the Department of Employment over the years. We understand what it means to that man. He will not carry out any more research studies while this Government are in power, so obviously he really means what he says in his report.
  Mr. Butterfill: Will the hon. Lady give way?
  Ms. Short: I am sorry; I am very short of time.
  Mr. Wilkinson makes the serious charge that the Government are fabricating and distorting the evidence that comes from the research that they commission. I will briefly summarise the case that he made.
  The Department of Employment commissioned a study of the effects of the retailing wages council from independent academics, but when the results became available last year they were embarrassing. Contrary to ministerial researches, the research found that minimum wages had had no effect on employment.
  The Department of Employment did not publish the report until this May, and in the meantime hurriedly assembled its own report on the effect of wages councils in the clothing industry, which it then published on the same day. The clothing report came to remarkable conclusions for an industry in which relative wages had fallen since the 1950s by 20 per cent. for men and 13 per cent. for women. The Department of Employment concluded that wages were to blame for unemployment. Mr. Wilkinson points out that that conclusion could have been reached only by the improper use of data and a muddled methodology. Certainly the report bears all the signs of being put together very quickly and with a decided lack of competence.
  The Department of Employment report ignored completely the effect of falling demand and imports in looking for an explanation of the decline of the clothing industry, preferring instead to place the blame on the industry's wages councils, but its conclusion is at odds with the perception of firms within the industry, 86 per cent. of which attributed the fall in employment to lack of demand and import penetration. So much for the research that we now get from the Department of Employment.
  The final point from Mr. Wilkinson is that, using methodology and data considerably more reliable than that used in the Department of Employment study of clothing, the Ministry of Agriculture, Fisheries and Food analysed the impact of the minimum wage for farm workers. The report concluded that an increase in the value of the
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  minimum wage increased both the demand for and the supply of labour, and hence employment Again, the findings were in complete contradiction of the views of Ministers on the effect of minimum wages The Department of Employment is quite unjustified in suggesting that the research findings demonstrate convincingly the potential for minimum wage increases to affect employment adversely The Department is saying exactly the opposite of what it found in its research
  Mr. Jim Lester:Will the hon Lady give way.
  Ms. Short: No, I am so short of time [Interruption ] I am not scared of Conservative Members I may give way later if I find that I can get through my speech in time [Interruption ] I have more to say than the Secretary of State On the Labour Benches we care about the wage levels of low-paid people Conservative Members can sit there smugly and richly while wanting to cut the wages of people who work 40 hours a week for £67.
  The consultative document produced by the Government is enormously biased It does not ask openly for a discussion of the effect of wages councils, whether they destroy jobs or not, or whether people want them to be strengthened, weakened or modified In the light of the research evidence, what the consultative document says is disgraceful Paragraph 7 says that
  "Wages councils interfere with the freedom of employers to offer, and jobs-seekers to accept, jobs at wages that would otherwise be acceptable This restricts job opportunities, particularly for young people".
  Paragraph 8 says that
  "A number of studies support the view that statutory minimum rates jeopardise employment."
  I have just dealt with the studies that prove that statement to be wrong.
  Tory Back Benchers pretend that they care about the low paid, but they are quite prepared to sacrifice young people on the altar They are going for the young people The consultative documents suggest that they should be removed from protection, even if the wages councils stay That means that, even if we retain wages councils, we must denounce the International Labour Organisation convention But what does the ILO tell us about the position in the rest of the world? It says that
  "Almost all countries in the world now operate minimum wage systems, and none to our knowledge excludes young workers The latter are entitled to such protection as any workers, and even more so because they are more vulnerable to possible exploitation due to their inexperience and perhaps because of their very desire to earn a living by finding a first job "
  Since 1979 — [Interruption] Conservative Members should look at the evidence instead of showing their prejudices Since 1979 youth unemployment has doubled but the relative pay of young people has fallen sharply over the same period Young males have received pay rises 23 per cent lower than the average increase for adult males Young women's pay has fallen 20 per cent behind the equivalent increase for adults.
  A Department of Employment research — [Interruption ] I have only 15 minutes and Conservative Members will have their opportunity later A Department of Employment research paper, published in 1980, concluded that
  "variations in youth unemployment do not appear to have any systematic relationship with changes in the relative earnings of young people".
  That is a fine piece of research by a man called Makeham It shows that youth unemployment grows faster than

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  general unemployment and that it falls faster when unemployment is falling. It has nothing to do with wage levels, and there is no evidence for that.
  A more recent paper, published by the Department of Employment in 1983, contradicts the earlier finding. This is one of those pieces of academic research that the Department of Employment hunted for in trying to find some academic who would provide a case in support of its prejudices. The paper tentatively suggests that the employment of young people under 18 years of age appears to have been reduced by increases in their average earnings. The author warns, however, that the analysis relies on data which are already fraught with problems and that therefore the results are extremely tenuous. His warning that the results should be viewed with caution appears to have been wholly ignored by Ministers, and it has been quoted in this House repeatedly. The final point in that piece of research is that, to the extent that cuts in youth wages did result in new jobs, that would be largely at the expense of adult workers. What is the point of that?
  The Department of Employment study that I have just quoted estimates that eight out of 10 new jobs created for young people, if their wages were cut, would be jobs lost by adults. It costs more to keep an adult on the dole, so it does not even make economic sense from the Government's point of view.
  The Public Accounts Committee found that 77 per cent. of the jobs subsidised under the young workers' scheme that the Government are now getting rid of, but which was deliberately used to try to cut youth wages, would have existed anyway, even without the subsidy. The vast bulk of the additional jobs that were created were taken away from adults.
  It is not just that there is no case for abolition of wages councils, or weakening the position of young people or excluding them. There is a strong case against doing so, not just on the basis of social justice—to which I shall refer in a moment — but on the ground of the inefficiency that is encouraged.
  In the words of Mr. Frank Wilkinson,
  "Employers' attempts to escape from competitive pressure by attempting to reduce their wage costs can only be temporary and in the long run are counter-productive. The ability to protect profits by reducing wages allows producers to avoid any long-term solution of their lack of competitiveness by reinvesting in improved efficiency or developing new products. Moreover, the availability of lower wages as a strategy creates a particularly destructive form of competition which undermines product market stability, upon which favourable expectations depend. The consequent uncertainty militates against long term solutions."
  We get the bad employer paying rotten wages, not investing, and not training his staff. They undermine each other, lower the conditions of employment, and increase Britain's chronic unemployment problem and the problem of very low investment. The road that we are going on is to cut wages to such a degree that we shall be competing with Third world countries for jobs.
  I come now to social security. Two days ago, the Secretary of State for Social Services told us—and the Prime Minister repeated it—that in the review of the social security system they were deeply concerned about the needs of the working poor. Yet the Government are suggesting that it would be a really good idea to cut the wages of the working poor.
  Mr. Baldry: Who said that it would be a good idea to reduce the wages of the working poor?
  Ms. Short: The proposal to abolish wages councils is a proposal to cut the wages of some of the poorest workers, otherwise there would be no point in the Government making the proposal.
  The new family credit scheme, which is to replace the family income supplement, is a subsidy to bad employers paying low wages and lacking investment and training. If the Government want to subsidise British business, they should put money into firms which invest in training, higher technology and so on. Instead, they propose to spend more of the taxpayers' money on subsidising the worst employers in the land.
  Who are the people protected by wages councils whose conditions the Government are anxious to undermine? We are speaking of 2·75 million people, 11 per cent. of the work force. About two thirds of them work part time. Any threat to remove protection from part-time workers is a threat to the majority of those people. Four out of five of them are women and half of all women workers are protected by wages councils. This, therefore, represents an enormous threat to women.
  About 5 per cent. of people protected by wages councils are young. That may be a small percentage of the total, but it represents 20 per cent. of all young workers, and 90 per cent. of them work in retailing, catering and clothing. Large numbers of them are black workers — [Interruption.]Conservative Members may smirk and grin at the evidence, but prejudice is all that they are interested in.
  We are told by the Select Committee that 25 per cent. of families classified as poor have a low earner at their head, and that proportion rises to 40 per cent. when pensioner families are excluded. In other words, although 40 per cent. of poor families in Britain have a low paid worker at their head, the Government want to cut their wages.
  Would anyone dare argue that, because most women work, they really work only for pin money? I am sure that many Conservative Members think that. Would they dare say it openly? In one in four households the main breadwinner is a woman. These are households in which there are single women, sometimes with dependent relatives, and one in eight women look after an elderly dependant. Alternatively, a single parent is bringing up children on her own. One in 10 households is headed! by a single-parent mother. Women are the sole earners, because of the unemployment of their partners, in 400,000 families.
  In addition, women's earnings equal or exceed those of their male partners in one in seven of all married couples. If it were not for the earnings of married women, four times as many families would be living in poverty. The low wages that those women earn are absolutely crucial to enable them to look after their dependants and families.
  What, then, are the princely wages that the Government want to cut? We are told in the consultative document:
  "Most minimum full-time rates at March 1985 for adults ranged from £63 to £72."
  For young people we are told that 16-year-olds
  "get roughly 65 per cent. of the adult maximum"
  and that 17-year-olds
  "get 75 per cent. of the adult maximum."
  That represents £40 to £50 a week, yet Conservative
  Members have the cheek to suggest that that is too much
  for young people to earn. Among those who claim that is

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  the hon. Member for Birmingham, Edgbaston (Mrs. Knight), who represents a neighbouring constituency but who, unfortunately, is not in her place.
  Since 1979, the lowest paid have taken major pay cuts. According to recently published Treasury figures, the highest paid men have enjoyed increases in real net pay 10 times as large as the wages enjoyed by the poorest, and the Government want to increase still further the wages of the better paid and, at the same time, to reduce the wages of the poorest.
  The Government have no case for suggesting that the abolition or weakening of wages councils will create jobs. The claim is false and there is no evidence for it. [Interruption.] Conservative Members may laugh, but they cannot laugh away the evidence. What the Government propose will simply encourage bad employers and bad employment practices, low investment and a lack of training. This move is opposed by the public.
  Several Hon. Members rose—
  Ms. Short: I have taken too long already. [HON. MEMBERS: "Hear, hear." Tory Members may not care about the low paid or try to laugh off the evidence that my hon. Friends and I have been adducing, but I wonder whether they care about public opinion. A survey carried out by Mori in 1983 found that 66 per cent. of adults, including 62 per cent. of Conservative supporters, favoured a minimum wage for all workers. A recent opinion survey in the north-west conducted by Granada TV showed that 89 per cent. were in favour of retaining wages council protection.
  The Labour party will fight the Conservative party every inch of the way on this issue. We shall fight to retain the protection that low-paid workers have through wages councils and, when we take power, we shall ensure that they have improved protection.
  Several Hon. Members rose—
  Mr. Deputy Speaker (Sir Paul Dean): Many hon. Members wish to take part in the debate, so short speeches, please.
  8.25 pm
  Mr. Peter Thurnham: I am grateful for this opportunity to speak, having found myself in a minority of one in dissenting from the Select Committee's report. I am disappointed that the Chairman of the Committee, the hon. Member for Newham, North-East (Mr. Leighton), is not in his place. Indeed, it is extraordinary that the Chairman is not present, especially as I am bound to comment on the way in which the report was put together.
  It was surprising that we had a report at all because at one stage it was thought that there would not be one. It was produced at remarkable speed, and that was probably why there were no amendments. At one stage I began to think that I was at a SOGAT meeting, considering the way in which the matter was progressing. I had had a difference of opinion with the Chairman on a previous occasion about GCHQ, and I found that I was getting the same sort of treatment this time. However, I managed to register my dissent before the report went to press.
  It was a pity that matters proceeded so quickly because three important items were missed. I am not sure whether
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  I am a believer in the conspiracy theory or the cock-up theory of history, but an important report from the Department of Employment arrived just hours after the Select Committee had had its last meeting. That report was on the clothing industry, and it showed, from an examination by me of the figures, 50,000 job losses. That is significant because the report itemised the big rundown in employment in that industry in the last 30 years. Jobs dropped from over 500,000 to about 250,000, and 50,000 of those were lost because of minimum wage legislation.
  Mr. Kevin Barron: Did the report to which the hon. Gentleman is referring add that the wages in the industry had gone down by 20 per cent. over the same period?
  Mr. Thurnham: The principal point was that the wages of people starting in the industry, including youngsters, had been pitched at such a level that the industry could not train people to take the places of those who were leaving. In my constituency there is a shortage of skilled machinists because there is no incentive for employers to train people in such skills.
  The Select Committee missed another important document. That was a report by Dr. Stanley Seibert of Birmingham university which showed that as many as 230,000 job losses could be attributed to minimum wages legislation for youths.
  The Select Committee's report is disdainful about the figures for job losses and speaks at one point of "only 25,000 jobs" having been lost. Even 25,000 must be worth concern. After all, who would like to choose the 25,000 people involved? Even the Labour party's economist, Neuburger, referred to "only 8,000 job losses." Who on the Opposition Benches would care to name those 8,000 people?
  Mr. Prescott: Is the hon. Gentleman aware that unemployment in Britain has increased by 4,000 a week and that he has regularly voted for the policies that have brought that about?
  Mr. Thurnham: Unemployment in Britain has resulted from mistaken policies over many years — [Interruption.]—policies which have been followed by the Labour party and which are still advocated by Labour Members.
  The third item which, unfortunately, the Select Committee did not examine was the report by the Minister for Health and Social Security this week in which he makes interesting proposals for the reform of the welfare state, including the new family credit scheme. That scheme finally makes wages councils totally obsolete.
  Wages councils were introduced for three reasons— wages, hours, and unsanitary conditions. Unsanitary conditions have been dealt with by health and safety legislation; hours are no longer a problem because most of the people are part-time workers; and wages will now be taken care of by the family credit scheme proposals, which are excellent and which will cover what people want. People want a good take-home pay. They do not want legislation for a wage that employers cannot afford to pay from which massive deductions are made to cover the cost of payments to the unemployed which are caused by a ridiculous policy.
  What is the problem? We want to see the unemployed back at work. If 200,000 extra jobs are possible, what is

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  holding them up? I think that there is a conspiracy between the employed and the unemployed fed by fears fostered by the Opposition that there will be wage cuts. The hon. Member for Birmingham, Ladywood (Ms. Short) said that there would be wage cuts. That demonstrates her misunderstanding, because there will be no proposed wage cuts.
  Mr. Baldry: Does my hon. Friend think that bodies such as the Association of British Chambers of Commerce, which represents many employers, are part of the conspiracy?
  Mr. Thurnham: It is cosy to be able to get together with other employers and keep the current wages and to say that it does not matter about the unemployed because they do not come into the argument. That is a nice little restrictive practice.
  Mr. Jim Lester: It seems unfair that in every sector any employer can pay what he will and the family's wages are made up by the taxpayer. It is a question of employers who seek to pay as little as possible knowing that the wages of family workers will be made up. That does not apply to women workers or young workers. That is an unfair way of treating the taxpayer.
  Mr. Thurnham: If my hon. Friend looks at the booklets produced this week, he will see that what will happen is that take-home pay will increase with gross pay. If someone is paid more by his employer, he will have more to take home and he will not be interested in employers paying less. That should not apply in any case.
  The fear has existed since the measure was introduced in 1909 when the welfare state did not offer protection. The Under-Secretary of State is not here tonight because he is in Geneva — I hope doing a good job. In the middle of the night in our previous debate he said that if the wages councils were to be totally abolished
  "I have no doubt that some people would find themselves, at least temporarily, in circumstances which would be difficult to defend."—[Official Report, 26 March 1985; Vol. 76, c. 416.] I have asked myself what he meant by that, and it crossed my mind that he might have been thinking of the wages councils' inspectors themselves. I accept that other employment would have to be found for them. However, perhaps my hon. Friend was thinking of people who might have their wages cut, but I do not understand that. In manufacturing industries wages are determined by the prices of the goods produced based upon world markets, and employers will compete among themselves to set the wages of people who can work profitably. There will not be any wage cuts for people who are occupied in profitable manufacturing industries.
  The service industries are not the same, because world prices do not apply, but employees still have the protection of their employment contract. After two years their wages cannot be cut. That would mean constructive dismissal, so I do not see how people's wages will suddenly be cut. We are talking not about cutting wages but about bringing in people lower down the ladder of earnings opportunities. I do not see why we should take away the bottom rungs. People on the bottom rungs will not affect the wages of those on the higher rungs who have the skills to command higher wages. Average wages might come down but there is no reason to believe that people working in the service industries should suddenly have their wages reduced. Obviously, by mutual agreement their wages could be reduced.
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  I find it most difficult to defend the circumstances of workers who have no mutual agreement and who lose their jobs through redundancies About 250,000 jobs in the clothing industries have been lost I find that difficult to defend.
  Hon Members talk about reform and say that youngsters set their own wages to keep a semblance of the wages councils What happens when someone is 21 years of age9 The hon Member for Truro (Mr Penhaligon) talked about redundancy at 21 That is ridiculous He suggests that the person of 21 should be told that Parliament has legislated that he must now have protection and that that means that he must be made redundant We talk about protection of wage levels, but not about the protection of the job itself.
  I am in favour of the protection of the unemployed against obsolete laws which can stop people starting work on the bottom rung of the ladder What is the point of being on the dole and without a job? Everybody should be able to start a job at whatever wages they can command I believe that the unskilled should be protected so that they can gain skills If someone is taken on at too high a wage, what incentive has he to gain extra skills? They must be given the incentive to improve their skills and the employer must find the means to train people.
  Mr. Michael Forsyth: My hon Friend has been generous in giving way, unlike the hon Member for Birmingham, Ladywood (Ms Short) In the course of his deliberations in the Select Committee, did he come across the document produced by the TUC which states:
  "There must obviously be some truth in the proposition that all other things being equal, an individual employer will tend to employ more people if wages are lower and fewer people if wages are higher"?
  If my hon Friend has a copy of that document, perhaps he will give it to the hon Member for Ladywood.
  Mr. Thurnham: I am grateful to my hon Friend— that is exactly it When talking about the national minimum wage, the Opposition do not seem to be able to make up their mind whether they want a national minimum wage The document "In Place of Strife' was put down by people who thought that they knew better That is probably the main reason for today's unemployment The Department of Employment was commissioned in 1969 to produce a document on a national minimum wage Paragraph 186 of that document states the effect on employment It states that the national minimum wage would increase the level of unemployment, and that the worst impact would fall on the less prosperous areas, including the development areas, Northern Ireland could be particularly affected That is why there was no minimum wage legislation in 1969 That is why the Opposition play around with the words and go no further.
  I am grateful for the opportunity to make points which were not included in the Select Committee report I am learning at every stage In future when I have differences with a Chairman I shall be able to include my points in the report I am all in favour of proposals which ensure that people have a proper take-home pay, but I am totally opposed to legislation which tells the employer what he should pay at such a level that the employer cannot pay it, and therefore cannot provide the job.
  8 39 pm
  Miss Joan Maynard (Sheffield, Brightside): Wages councils exist to protect those who cannot protect

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  themselves because they are not unionised to give them real strength. Because they are not strongly organised in their appropriate trades unions, they rely on the law and the inspectorate to enforce their wages. That is always a dicey business under capitalism. It is clear that a Tory Government can always pull away the prop, which is what this Tory Government propose to do in pursuit of their policy of driving down wages. They have created mass unemployment as a strong stick with which to beat the workers. They brought in the youth training scheme with low remuneration, and now propose to extend it.
  The introduction of Sunday trading is part of the strategy of driving down wages. It will mean more part-timers on lower rates, although God knows that part-time working on lower rates has already vastly increased. There is nothing wrong with part-time work, provided that the hourly rates and conditions are the same as those for full-time work. Indeed, there are many arguments in favour of part-time work. However, the truth is that part-timers are paid lower hourly rates and usually have worse conditions than full-time workers.
  Doing away with wages councils — which the Opposition will certainly resist — will not only drive wage rates which are already too low even lower, but will bring back sweated labour. Talk about Victorian values —they will be with us with a vengeance.
  The consultative document claims that wages councils' orders are difficult to understand. Of course, there are none so dense as those who do not want to understand. It is alleged that the difficulty in understanding the orders is one reason for underpayment. If people believe that, they will believe anything. There must be few employers who fail to obtain the grants to which they are entitled because they do not understand the regulations. The wages inspectorate continually report flagrant violations of wages board orders. Therefore, there is a case for more enforcement, not less. Few union members and no officials have difficulty in interpreting the orders.
  It is argued that more jobs would be created if wages were lower. I want to re-emphasise the point made by my hon. Friend the Member for Birmingham, Lady wood (Ms. Short). The Minister of Agriculture, Fisheries and Food analysed the impact of the minimum wage for farm workers, and the report concluded that increases in the value of the minimum wage
  "increased both the demand for, and the supply of, labour and hence employment."
  Ministers have found themselves arguing the case for abolition of wages councils against mounting opposition from public opinion, employers and some of their own Back Benchers as well as trade unions and the poverty lobby. The weight of evidence is that abolishing the councils or rendering them ineffective would have little or no effect on unemployment.
  In the absence of credible evidence beyond unsubstantiated anecdotes, the Department of Employment appears to have tried to cover Ministers' embarrassment with spurious and misleading claims for the likely effects of abolition. It is now time for the Government to admit that the king really has no clothes.
  Ministers have given no estimate of the increase in jobs likely to flow from the abolition of wages councils. When pressed to do so in relation to young people, they were unable to produce any figures or evidence. Paragraph 11
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  of the consultative paper claims that the wages set by the councils make it more difficult for those who wish to take up employment to do so. That is absurd because paragraph 7 notes that the minimum rates range from £63 to £72 a week, which respectively are 41 per cent. and 46 per cent. of national average earnings.
  The majority of employees covered by wages councils are women, and their average earnings hover around 53 per cent. of national average earnings. Therefore, women will suffer from any abolition of wages councils. The fact that 37 per cent. of workers covered by wages councils are paid the minimum only does not support the argument that rates are too high. Indeed, as has been made clear in many inspectorate reports, it suggests that underpayment is rife.
  My union, the Transport and General Workers Union, will continue to fight for low-paid workers, including farm workers, regardless of the fate of wages councils. Our principal interest is in the agricultural wages board. We are especially concerned about the consultative paper's attack on younger workers aged 18 or under. We appreciate that that could so easily be read into the agricultural wages board provisions.
  We see the attack on wages councils as a veiled attack on the wages board, and we shall certainly resist any such attack, as we resist the attack on wages councils. I make it clear that we shall also resist the so-called reforms, because I believe that they will be almost as bad as abolition.
  8.47 pm
  Mr. Richard Alexander: All that we have heard from Opposition Members so far has had an element of unreality. No one has yet used the words "employer" and "customer". They ignore the fact that it is the employer who pays the wages. If wages councils regularly award unrealistic rates, employers will not be able to pay them and firms will go out of business. The employer will become unemployed, as will the employee. I should have thought that Opposition Members would have been only too anxious to direct their minds to that.
  Everyone in this House is greatly concerned about unemployment. None profess to be more concerned than Opposition Members. It is therefore surprising that they do not understand that wages councils are a straitjacket on employer and employee alike.
  Reference has been made to youth unemployment. The effects of wages councils' demands in that area are so obvious that I am surprised that anyone feels able to stand up and justify them.
  I want to concentrate my few remarks on wages councils generally. The rigidity of some of their awards prevents the development of sensible wage structures and systems of remuneration tailored to the needs of industry and business. Wages councils concern themselves not only with pay—if they did, perhaps there might be a little more justification for them—but with hours of work, holidays, part-time working, overtime wage rates and a host of things that sensible employers and employees in other businesses and industries not covered by wages councils manage to settle by themselves.
  In today's highly competitive world, businesses will fail unless they can make sensible and realistic forward planning forecasts. Few businesses can organise themselves and settle the difference between a profit and a loss without knowing precisely what their overheads will be during the next 12 months.

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  The biggest question mark against any employer's forecast is labour costs. It is a crucial factor. The fact that that should be decided by other people, many of whom have no direct business experience whatever, and without regard to whether that business will continue profitably, is tying the business man's hands behind his back. Nor is it any more satisfactory for the person who is employed. An able worker with years of seniority and experience finds his wage differentials annually eroded as a result of these awards, particularly to young workers, to the point where seniority and responsibility are counted as of little worth and there is no incentive left to achieve either.
  It is essential that there should be economic recovery. That could be achieved by more flexible hours and by encouraging efficient, low cost businesses which can compete with foreign competition. It is a truism that the new small businesses of today will be the big businesses of tomorrow. If their growth is stunted at this stage, we shall do no service to employment prospects.
  Since the recession, more and more small business employers have had to pay themselves less and less in order to satisfy the ever increasing and ever more unrealistic requirements of the wages councils. The uncertainty of those awards—the fact that they can be backdated — is a terrifying prospect for the small employer who has limited capital. These requirements are a very large factor for an employer in deciding whether he can afford to take on extra staff. In practice, each new wages council award has meant a cut in the hours that an employee may work. The corollary is an increase in the hours that the employer has to work if he wishes to stay in business. When the Opposition hear of businesses failing, they are the first to say that it is the Prime Minister's policies that are creating unemployment. They never consider that it might be the result of the unfeeling, appalling bureaucracy which is interfering with the day-to-day operations of businesses which are trying to do their best.
  We are still one of the least efficient industrial nations. We still pay more but produce less than most of our competitors. The essential problem of keeping costs down in order to remain in business does not concern the wages councils and the academics who serve on them. The fringe benefits that they award become more and more unreasonable every year — for example, increased holiday allowances for workers who may work for only two days a week or who may even work from home.
  The contact with reality of many who serve on wages councils is tenuous. Wages councils were formed to protect those who work in small enterprises where at one time union organisation was impracticable. In industries where there are unions a settlement is reached between management and union, but that does not happen in industries which are covered by wages councils.
  Wages councils are answerable to nobody — not to employers, to employees, or to this House. Working in their ivory towers, the only jobs that they protect are their own. If they succeed in raising wage levels beyond what the market will bear, employers will be unable to continue profitably in business. Wages councils will harm the ability of employers to provide better working conditions and fringe benefits. They are costly and expensive items in the day-to-day business of any employer.
  In any group of people there are variations in ability, self-confidence, application and usefulness to the employer. If the cost of offering work constantly goes up,
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  the less able and useful will suffer. Those who are highly skilled will get the jobs. If wages councils continue in existence, the less able will be permanently barred from having the chance of a job. The abolition of wages councils would not entirely solve our unemployment problem, but would help to solve it. It would bring greater flexibility to the labour market. The wages councils would cease to do a job which ought to be done by the social services.
  8.56 pm
  Mr. D. E. Thomas: The abolition of the wages councils would discriminate against women, because a high proportion of women are covered by them. Their abolition would also increase the amount of racial discrimination against the black community. There is also a regional dimension to this problem. The economies of Northern England, Wales and Scotland are already low-wage economies. If it were true that low wages created jobs, the boom areas would be the low-wage economy areas, but that is not the case. The low-wage economy areas are also the high unemployment black spots. Far from employment being created by low wages, unemployment is to be found alongside stagnant wages levels and low productivity.
  The Government have not produced figures that show the number of workers who are covered by wages councils in Wales. When I asked the Secretary of State about the number of jobs that would be created by the abolition of the wages councils, he was unable to produce any figures. Eight thousand jobs in Wales could be created over five years. This would be one twelfth of the jobs lost in Wales since 1979. As a proportion, this would produce perhaps 500 jobs in Wales.
  The Government's monetarist policies are creating unemployment. The decision to abolish the wages councils is a product of supply side fanaticism, but it is the fall in the aggregate demand in the economy caused by monetarism which is the cause of unemployment. The supply siders believe that the poor and the unemployed cause unemployment by pricing themselves out of jobs and that if the wages councils are abolished wages will be cut and more jobs created. This fantasy is deliberately nurtured by the Government to obscure their intentions.
  When we debate the substantive legislation, I hope that this debate will herald a major campaign throughout Britain, particularly in the industrial sectors which already suffer from depressed wage levels and in the regions where for years there have been low-wage, depressed economies. We must mount an effective campaign against these sexist, racist, anti-working class proposals.
  8.58 pm
  Mr. Lewis Stevens: I rise to speak in support of wages councils, but perhaps in company that I did not anticipate. I shall still speak in favour of them, but not with the same fervour or with the same views as Opposition Members. The case that could be made in support of them has been overshadowed by strong political rhetoric and by claims that cannot be justified.
  At present there are 26 wages councils, which represent about 2·75 million people. However, seven of them represent as many as 2,600,000 people. Thus there are two different types of wages council. A small group of them represent the majority, and many smaller wages councils represent a wide range of other employees. That is why

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  there is a need for reform. Hon. Members should bear in mind that two thirds of the units involved employ fewer than 10 people. Consequently, wages councils, which are very rigid and have many rules, do not give many of the small employers any opportunity to understand their real purpose. I believe that wages councils should be restricted to looking at the basic wages of adult employees and some of their basic conditions.
  However, it is too easy to say that all young people have priced themselves out of work. In general, they have not done so. At present, wages councils set the adult rate. Many of the industries that are covered employ people who need comparatively little training before they can achieve a reasonable rate of work. That level is rightly, in some cases, set at 18 or 19 years of age, and that is only sensible.
  However, industries gradually change. Demand changes, and consequently there are manufacturing and technological changes which may mean that wages councils have to be more flexible in their approach. However, the argument that young people price themselves out of jobs is no more true than the argument that low wages automatically lead to greater benefits, more jobs. It is true that higher wage rates can price people out of work, but the converse is not automatically true. In some areas, exploitation already exists. Inspectors have already reported on cases of people being underpaid. Sometimes that is accidental, but sometimes it is not. If we remove all regulation, that exploitation will increase —perhaps not greatly but sufficiently.
  Many of the 2·75 million people covered by wages councils are already subject to various collective bargaining arrangements within their industries. Thus, fewer than 2·75 million people are genuinely dependent on the results achieved by wages councils. I do not think we can risk removing all such regulation in anticipation of the fact that more competition at the bottom will lead to genuine benefits. When young people have achieved a certain level, they should be paid the rate for the job, but until then they cannot expect anywhere near the full rate. It is productivity that matters. The employer must see a return, because otherwise he will ask himself whether it is worth employing a person at a certain rate. If an employer is not obtaining £62 worth of work, it is not economical for him to pay that rate.
  Mr. Frank Field: The hon. Gentleman has made several valuable points, but is there not a danger in trying to explain all pay levels by productivity levels? Agriculture is a high productivity industry, but the wage rates are low.
  Mr. Stevens: I accept that one cannot pursue that argument to its end. However, the difference between employing and not employing people must depend to some extent on how much work is done. For example, in the case of certain shop jobs, there must be a time when people are not fully employed as otherwise they could not be brought in to deal with big queues.
  I support wages councils. I hope that they will not be abolished and that we shall continue to give them a valuable role to play. However, there is a tremendous need for them to be reformed. Much of the bureaucracy that goes with them is not acceptable to many small businesses. The value of wages councils is not recognised, so they are not used and therefore they cannot help the people whom
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  they are there to protect. The most worthwile thing that we do is reform the councils, streamline them, make them more efficient and reduce the bureaucracy while keeping the basic regulations of protection for the ordinary working people.
  9.5 pm
  Mr. Dave Nellist: This debate arises out of what was described by the Chancellor of the Exchequer as a Budget for jobs. In reality, the purpose of the measure, announced in that Budget, of which the abolition, or changing the structure, of wages councils is but one, was to provide a sweatshop Budget, designed to produce low wages. That is in line with the Tory Government's philosophy. Over the past six years, they have used mass unemployment in an attempt to cower the trade union movement, to limit wage rises and to reduce the direct and indirect wages paid to working people.
  The employers and the industrialists whom the Tory Government represent, having failed to invest in new machinery in the past 30 years, and having realised that they have lost world markets and are now losing their share of the domestic markets whether in fridges, vehicles, televisions, radios or textiles, are cutting the share of wealth that goes to working people to restore or enhance their profit levels. They are cutting direct wages or, through the Government, cutting the social wages of education, housing and other social services. The threat is now extended to the wages councils.
  The wages councils cover almost 3 million workers in shops, hairdressing, clothing, catering and hotels. Significantly, despite what Tory Members have said, the wages councils do not cover manufacturing or the export industry. Therefore, the Tory Government's logic—that cutting wages for those covered by wages councils will help the British capitalist economy—is spurious. It will only increase the number of workers who have to survive on poverty wages.
  That 3 million is part of an army of 8·5 million workers living on or below the poverty line. One third of the workforce is living on a financial tightrope and the abolition of the wage councils would shred it. We are talking about wages of £60 or £70 a week. How can Tory Members understand what it is like to live on such a wage when for many of them it is the price of a week's gin and tonics in the Bar or Banqueting Rooms?
  The Tories have argued in this debate and elsewhere that the wages councils price workers out of jobs. We have had that tonight from a Member of Parliament who has seven jobs. Where is his evidence? In the past 10 years, wages council rates as a percentage of average wages have fallen from 73 per cent. to 65 per cent., but unemployment has rocketed. Tory Ministers and the Secretary of State have argued that YTS youngsters on £26 a week, hairdressers on £45 a week, check-out lasses and lads on £69 a week are getting too much.
  If high wage increases automatically lead to a destruction of jobs, why is there no condemnation from the Tory party of the chairman of ICI, who took a 63 per cent. increase in his wages last year? The Financial Times commented that, compared with some company chairmen, he is a pauper. He is on only £171,000 a year—£3,300 a week. Why is there no condemnation for the chairman of the British Oxygen Company, on £13,000 a week for selling fresh air? Why is there no condemnation of Cabinet

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  Ministers, who gave themselves a 9.4 per cent. increase last year or of company directors with an 11 per cent. increase?
  Under the Tory Government, the number of millionaires has doubled to over 8,000. Over 1 million people now earn over £20,000 a year. How many jobs of ordinary working people have been destroyed by those high salaries? According to the register of Members' interests, many Tory Members cannot survive on the salary for an MP. They have to have five, 10 or 15 jobs. The argument that wages of £60 or £70 per week authorised by wages councils destroy jobs is obviously rubbish in the light of what some Tory Members are getting. The argument of the Tories could be summed up by saying that the poor are not yet poor enough for unemployment to fall and the rich are not yet rich enough for investment in industry to take place.
  Mr. Thurnham rose—
  Mr. Nellist: Because of the time, I am not giving way.
  We on these Benches oppose the abolition of wages councils because the Labour party is against low pay. I have a private Member's Bill before the House which expresses TUC and Labour party policy. I hope that it will be implemented speedily by the next Labour Government to provide a national minimum wage for £ 115 per week for all workers for a maximum 35 hour week; that wage would start at the age of 18. There should be a pro rata wage for part-timers and increases should be linked to inflation. For 16-year-olds the rate should be 75 per cent. of the adult rate and for 17-year-olds it should be 85 per cent. For those in Government training schemes, no one should receive less than the £55 per week that a trade union member would get.
  We are arguing not just against the abolition of wages councils but in favour of a campaign by the trade union movement to get the 3 million workers covered by wages councils into trade union membership so that we may fight for the enhancement of their conditions.
  Wages councils are by no means perfect. In 1983 the wages council inspectors visited 23,000 work places. In 9,000 cases employees were being illegally underpaid, but there were only seven prosecutions. In 1984 there were two prosecutions. We have in government the so-called party of law and order, the Tory party. When the Tory Government see evidence of massive avoidance of the law in regard to the payment of wages, do they strengthen the wages inspectorate? No; they cut its number by one third. Do they give the inspectors more tools to do their job? No; they restrict their activities by reducing the miles they are allowed to travel. They change the law to allow their friends off the hook.
  If wages councils were to be abolished, it would be a direct attack on women and young workers. Four fifths of all workers covered by wages councils are women, and one in five of all young workers are covered. The Secretary of State said that wages councils price young people out of jobs. Even the consultative document on which the debate arises says:
  "there is a growing body of evidence that the employment prospects of young people are adversely affected by the level of their pay relative to adults."
  What evidence exists for that? Youth wages have fallen sharply over the last six years. Relative to adult rates,
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  wages for boys are 8 per cent. lower and for girls 12 per cent. lower than they were five years ago. Yet youth unemployment has trebled.
  What sort of conditions are the young people working in? Just under two weeks ago I had an article in a magazine called "Just 17". As a result of that article over 80 girls aged 16 to 20 have written to tell me about their employers.[Interruption.]That seems to provoke laughter on the Tory Benches. I heard about a 19-year-old in the Black Country who is working for a stockbroker who no doubt has many friends on the Tory Benches. She is working from 9 am to 5·15 pm. During the three months she was training she received £30 per week. Now she has been taken on permanently at £32·50 per week.
  I heard from another young girl who was lured to Devon to work in a shop by a bloke who promised her a flat and wages of £50 per week plus commission. Now she finds that she is working seven days a week from 10 in the morning until 9 at night. For all those hours she gets. £10 per week plus her board. She is to get commission only if the shop takes over £400 per week, but while she has been there the takings have never been more than £200 per week. I heard from another young girl in Rhyl in Clwyd who is working alongside someone who receives £78·50 per week as a typist; she is on YTS and is getting £26·50 for doing the same job.
  Have those wage rates created massive increases in new jobs for young people, as the Tories have said tonight and in previous arguments? Earlier today in business questions, I gave some figures showing the true picture of youth unemployment now. Fourty-six per cent. of all England's careers offices have 10 or fewer vacancies for this year's school leavers. Ninety-four per cent. of Scottish careers offices and 95 per cent. of Welsh careers offices have 10 or fewer vacancies. Five hundred and seventeen thousand people will leave school this summer. Fifty-one careers offices do not have a single job available. Another 36 have only one job. Those 517,000 school leavers are chasing 12,355 vacancies—42 kids to every vacancy. In England the figure is 37 to one, in Wales it is 129 to one and in Scotland it is 144 to one.
  In only two places in Wales, Cardiff and Shotton, are there more than 10 jobs for the school leavers. Some 40 offices in Wales have fewer than 10 vacancies. In only five places in Scotland are there more than 10 jobs for school leavers. The statistics go on and on.
  Mr. Evans: Will my hon. Friend confirm that in Brecon and Radnor, where an important election is due to take place, young people are doing very well because there are 10 vacancies at their centre?
  Mr. Nellist: My hon. Friend is absolutely correct. In Wales, Brecon is one of the four offices with 10 or more vacancies. It just gets itself into double figures for the hundreds, if not thousands, of school leavers chasing those vacancies.
  The British capitalist economy under this Tory Government is in tatters. Some 5 million people are denied the right to a job. Some 6 million live in damp houses and 8.5 million live on poverty wages. The Government come forward with the idea of reducing the wages of people on £60 or £70 a week, claiming that there is not enough money in the economy to pay decent wage rates. Under this Government, over £50,000 million has left this country in the past four or five years and gone to the real

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  low-wage economies of South Africa, Korea, Brazil and Argentina, where the wage rates are kept low at the barrel of a gun often of a military police dictatorship. That is what is at the back of the minds of some Tory Members. They want to emulate the wage rates and conditions in Singapore, Bangkok or Bangladesh to compete with the textile manufacturers of those far eastern countries, affecting the young workers and women in those industries in this country.
  We are against the abolition of wages councils. We are even more interested in getting rid of this Tory Government and giving every worker a more decent week's wage for his job than he receives now.
  9.13 pm
  Mr. John Butterfill: Few hon. Members can have a constituency with more workers who are under the auspices of wages councils than mine. In Bournemouth, many workers are in the leisure, hotel, catering and retail industries. In fact, they are the backbone of employment in that town. Since I was elected I have been inundated with complaints about wages councils, and nearly all the employers in my constituency would like to see them abolished.
  Mr. Evans: What about the employees?
  Mr. Butterfill: It was not unnatural that I approached the matter with that view. There is no doubt that if we were to abolish wages councils there would be a considerable improvement in employment. Indeed, all the academic studies that I have seen show that to be the case.
  Mr. Evans: Which ones?
  Mr. Butterfill: I shall tell the hon. Gentleman which ones. The study giving the lowest figure comes from Henry Neuburger, who I believe is employed by the Labour party. In the Low Pay Unit report of 1984 he suggested that here would be 8,000 new jobs if the wages councils were abolished. The highest figure that I have seen is in the study by Dr. Stanley Siebert who suggested in 1985 that there would be 230,000 more jobs. A study by the Department of Employment last month suggested that there would be 50,000 more jobs. I do not know which of those figures is right.
  Mr. Evans: Will the hon. Gentleman give way?
  Mr. Butterfill: No, I do not have time to give way.
  Whichever figure is correct, surely those jobs are worth having. There has been an enormous volume of representation to the Government and also to me because I have taken a particular interest in this as secretary of my party's sub-committee on tourism. Many employers, the Institute of Directors, the National Federation of Self-Employed and Small Businesses and the CBI have all made representations urging us to proceed with abolition. The hon. Member for Truro (Mr. Penhaligon) said that the CBI did not favour abolition, but its parliamentary brief for this debate states in capital letters:
  "Each wages council should be abolished unless employers make a substantial case for its continuation."
  Mr. Evans: What about employees?
  Mr. Butterfill: Many other employers have suggested reform rather than abolition, including the Institute of Personnel Management, ACAS and the National Chamber
  526
  of Trade. The Auld committee, too, recommended reform rather than abolition. Given the differing views, the Government are right to say that there should be a considerable period of consultation before any decision is made.
  If wages councils are retained, there must be substantial reforms.
  Mr. Evans: To strengthen them.
  Mr. Butterfill: The hon. Member for Truro referred to the ridiculous position of young workers. Young and inexperienced people are automatically paid the same as more experienced workers. That is not the situation in Holland, Denmark or Germany. Protection for young workers should be either abolished or subject to graduated stages up to the age of, say, 23 as in Holland.
  I am also concerned about the rules for Sunday working. If, as it seems, we are to proceed with Sunday trading there will be considerable problems, as there are already in Scotland. It is ludicrous to insist on payment at double time for Sunday working. If there is any differential at all, it should not be more than time and a half for Sunday working.
  There is also considerable concern about the independent members of the councils. That, too, must be urgently considered if reform is to take place.
  The scope of the wages councils should be strictly limited to minimum wage levels. Very small firms with, say, fewer than five members should be excluded. Larger firms with existing trade union agreements or satisfactory collective bargaining agreements of other kinds should be allowed to come out of wages councils because they are adequately protected already.
  To do all that, it may be necessary to repudiate ILO convention No. 26. If that is necessary, the Government should do so.
  9.24 pm
  Mr. Paddy Ashdown: As my hon. Friend the Member for Truro (Mr. Penhaligon) and others have said, two options were placed before us in the Government's consultative document. They are that we should abolish the wages councils, as stated in the Chancellor of the Exchequer's Budget speech, or that we should reform them. No hon. Member who believes that wages councils have an important part to play, as I and my right hon. and hon. Friends do, would deny that progressive action for reform would be welcome. The right hon. and learned Member for Monklands, East (Mr. Smith), in a debate on 15 February 1984, said, on behalf of the Labour party, that wages councils should be changed in some respects.
  There are many ways in which the effect of the wages councils could be strengthened, and perhaps some of the worst aspects of what they do to small businesses could be limited. Assistance could be channelled more effectively towards the most vulnerable. The observance of statutory minimum rates could be better policed. We could encourage more dialogue between both sides who sit on the councils, and it may be essential to lessen the burdens placed on small firms by the wages councils. For instance, the time lag between giving decisions and their being implemented could be shortened.
  If the Government produced a genuine package of reforms aimed at some or all of those objectives, we would have to consider them constructively. But the central issue

  527
  is either abolition or emasculation in the guise of reform. Wages councils are not necessarily the best way to protect the low-paid, but there is no doubt about the need for some mechanism for such protection. At present, the wages councils are all that we have.
  The abolition of wages councils would be an act of pure ideology unsupported by the facts now available to us. We have heard arguments from the Secretary of State and from Conservative Members that their abolition or emasculation would increase employment. But where is the evidence for that? The largest industry covered by a wages council— the clothing industry — together with the retailing and catering industries, represent 90·3 per cent. of all employees who are protected by wages councils. Between 1950 and the late 1970s, wages in the clothing industry decreased by 20 per cent. compared with average wages, and at the same time employment was halved. There is no evidence that a reduction in wages causes increased employment. In the other direction, I note that a 1982 report from the Ministry of Agriculture, Fisheries and Food stated that increases in average earnings appeared in that industry
  "to have increased both demand for and supply of labour, hence employment."
  The Department of Employment's in-house employment market research unit has produced evidence that points in the other direction, but, as the hon. Member for Birmingham, Ladywood (Ms. Short) said, the Low Pay Unit has completely discredited that research. It employed many unscientific statistics for its conclusions, and even included the footwear industry, which is not covered by a wages council. Many believe that that research was slanted to support some previously chosen prejudices.
  The matter is brought into clear relief by the Government, whose senior members seem completely unconvinced of the fact that the abolition of the wages councils will have no effect on employment. One need look no further than the speech made in April 1984 by the chairman of the Conservative party. He said:
  "It is not possible to estimate in any precise way how employment might be affected if wages councils were abolished." — [Official Report, 11 April 1984; Vol. 58, c. 255.]
  There we have it. There is the admission that the Government at the most senior level are not convinced that the abolition of the wages councils would have any effect on employment. Clearly revealed in that statement is the idea that this has been done for ideological purposes.
  If the wages councils go, we shall see the end of organisations which provide safeguards for 2·7 million people. In no sense can it be said that they provide high wages. In some areas—for example, hairdressing—the rates are as low as £1·18 per hour. Such wages are set at 25 per cent. of average earnings. Can it really be countenanced that those wages should be allowed to fall even lower? Is it really proposed that, with benefit to the economy and without exploitation of the people concerned, such wages should fall lower than that level?
  If one extrapolates the 1983 checking figures, it can be seen that there may be as many as 170,000 people who are underpaid. It will also be discovered from the 1983 survey that the amounts of underpayment are not insignificant. Indeed, it appears that on average each employee was underpaid by about £118.
  We would lose a structure which all too inadequately limits exploitation. Do the Government say that there is no wage exploitation? Surely they cannot be so blind. If
  528
  wages councils are abolished, how will they safeguard those who are vulnerable to low wage exploitation, or do they intend that there should be no such safeguards— that they do not intend to safeguard the wages of those earning as little as £1·18 an hour? As my hon. Friend the Member for Truro said, do they intend to abandon a safeguard which as a civilised society we have accepted for nigh on 80 years? Is that what they mean by returning to Victorian values and Victorian practices?
  There is no doubt that wages councils perform an important function. They are part of a civilised society. They safeguard the wages of those who are vulnerable to wage exploitation. They provide a mechanism which protects employers as well as employees from unfair competition based on wage undercutting. That is undoubtedly one of the reasons why many employers welcome their existence. They provide a framework within which orderly industrial relations and a voluntary collective bargaining system can operate.
  There is no evidence that the abolition or the emasculation of wages councils would produce anything but the most insignificant increase in employment. Is the questionable gaining of that worth so much sacrifice? The answer must be, "No". If the Government go for such substantial reform as will further weaken the powers and effectiveness of the wages councils, we shall see the triumph of prejudice over the facts, the triumph of dogma over compassion and the triumph of ideology over common sense and common humanity. Let the Government now announce that they do not intend either the abolition or the emasculation of the wages councils. If they fail to do so, let those Conservative Members who believe that wages councils have a part to play—I know that there are some—vote for our motion tonight.
  9.34 pm
  Mr. Ian Wrigglesworth: We have had a debate in which the arguments for and against wages councils have been wide ranging, and the strong feelings on both sides of the House about this issue have been put on the record. However, one voice has been notable by its absence. When I picked up the Daily Telegraph this morning—which I do not normally do with any great enthusiasm—I was pleased to find that the Conservative Centre Forward group had chosen its four priority issues which it intends to press in the House over the coming months. They are unemployment, the reform of the welfare state, the financing and organisation of local government, and the future of wages councils. The House will confirm that, despite that announcement, not one voice from that group has defended wages councils today.
  Another group, which might have been associated with the Centre Forward group, has also been missing today —the majority of those who supported the Employment Select Committee's report which recommended that wages councils should be supported. Three of the four members of that Committee who voted for the report are Conservatives. Unfortunately, we have had no speech supporting the Committee's report from the hon. Member for Banbury (Mr. Baldry), the hon. Member for Cornwall, North (Mr. Neale) or the hon. Member for Bat)ey and Spen (Mrs. Peacock). We shall be interested to see whether they support their views later today.
  Mr. Butterfill rose—
  Mr. Wrigglesworth: It is most regrettable that those voices have been absent from the debate.
  The Government have brought wages councils into the firing line because of their desire to divert attention away from the failure of their other policies on unemployment. They have tried to give the impression that abolition of wages councils will in some way which has not been proved today or elsewhere overcome unemployment. Indeed, they have tried to give the impression that the very existence of wages councils is a major reason for high unemployment. One need only consider the activities covered by wages councils to see what palpable nonsense that is.
  Two thirds of employees covered by wages councils work part-time and four fifths of them are female. The majority are covered by just six wages councils concerned with hairdressing, hotels, restaurants and the retail trades. The Secretary of State and his colleagues constantly tell us they are areas of expanding employment and, in many cases, increased efficiency and considerable success. Indeed, all the forecasts suggest that they will continue to prosper. One can hardly suggest that restaurants and retail trades are not expanding or that they are being restrained by wages councils. We have only to consider the extension of chains such as McDonalds, ASDA and Sainsburys to see that activity is not restrained by wages councils.
  It is unfortunate that, in the Budget, the Government tried to parade wages councils as one of the causes of high unemployment and suggested that their abolition would reduce unemployment. We have had a useful discussion about the reform of wages councils. Some useful reforms on simplification and on the pay structure laid down by the wages councils could be introduced. We accept that, but unfortunately the debate has not predominantly been about that. The Select Committee members examined this aspect as dispassionately as we would expect. There is no clear evidence to support the employment claims put forward by those who advocate abolition.
  Various pieces of evidence have been bandied about. For every piece of evidence that demonstrates that employment increases if wages councils are abolished, there is another to show the opposite.
  Mr. Evans: Anecdotes.
  Mr. Wrigglesworth: Much of that evidence is anecdotal. The report on clothing also dealt with the footwear industry, which is not covered by a wages council. Conservative Members should refer to the hon. Member for Macclesfield (Mr. Winterton) who, for many years, has argued for the textile industry as vociferously as anyone. The wages councils have not been the cause of the problems in the clothing industry. Management, lack of investment, poor marketing, design and product development and international trade have affected the industry. The Labour Government and the present Government have been criticised by hon. Members on both sides of the House for not acting more stringently to protect our home industry from unfair imports. Those factors have given rise to the loss of employment in the clothing industry much more than the marginal effect of wages councils.
  Hon. Members cannot rest upon that case to claim that wages councils should be abolished. No case has been proved during this debate or in evidence to the Select Committee showing that there is an employment case for
  530
  abolishing the wages councils. The overwhelming case for the retention of the wages councils is based on the argument for equity and for protecting the most vulnerable people within our society.
  What do the Government seek to do in relation to pay? In recent years, one of the divides between the two sides of the House — all Opposition parties and the Government — has concerned pay and productivity. Members on the Government Benches seem hell-bent on bringing about a low-pay, low-productivity economy, whereas Members on the Labour and alliance Benches want a high-pay, high-productivity economy, which they know is the only solution to our long-term problems and the only hope of beating overseas competition and having low unemployment in the future. The two major industrial countries that have succeeded so much where we have failed are Germany and Japan. In Japan especially pay and productivity have been rapidly increasing. The Japanese have succeeded in beating the competition and, therefore, in keeping unemployment low.
  Mr. Thurnham: Will the hon. Gentleman give way?
  Mr. Wrigglesworth: I cannot give way, because my time is limited.
  Instead of aiming for the type of economy that exists in Germany and Japan, the Government seem hell-bent on going for a low-pay economy and competing with economies that have low technology, low skill and low education bases. I am sure that the Opposition agree that that is not the direction in which we should move.
  The Government are at their weakest in their response to the case for protecting the most vulnerable people— workers who are earning very low rates of pay, between £65 and £72 a week. In some trades such as hairdressing, wages are even lower than that. Those are not the sort of people who are causing problems to the British economy. They are the sort of people who need the protection of this House to ensure that their standards of living are not curtailed even further.
  As hon. Members on both sides have said, it is interesting that the wages councils make a contribution to industrial relations. If there is not a collective bargaining system in an industry, the wages councils system provides a framework for an orderly determination of wages and conditions that would otherwise not exist. As the Select Committee pointed out, if the wages councils were abolished, that orderliness would go, and the consequent competition, wage cutting, and worsening in the conditions of workers would be very damaging to industry as a whole and not only to the workers.
  Therefore, there is an overwhelming case for retaining the wages councils, albeit with some of the reforms to which my right hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) referred when he opened the debate. I hope that, despite the lack of speeches from those Conservative Members who believe that the wages councils should be retained, the Secretary of State will be able to tell the House that, in taking note of the weight of arguments in the debate, he is prepared to give us an early decision that the wages councils will be maintained.
  I believe that the Government's policy towards the wages councils is a pathetic and dishonest attempt to divert attention from the failure of their other policies. Today's high unemployment is caused not by the levels of wages

  531
  but by the lack of demand within the economy. We made that quite clear to the Government in the Budget debates and in other economic debates in this House.
  More and more people are coming to realise that the only way in which we shall be able to cut unemployment is not by tinkering around with bodies such as the wages councils, or with the rates of pay of the lowest paid members of our community, but by changing the Government's economic strategy.
  Ministers must not suggest that by dealing with the so-called problem of wages councils they will be able significantly to reduce unemployment from 3¼ million. It has been suggested that the maximum number of people who could be employed as a result of the abolition of the wages councils would be 25,000. That would hardly make any impact on the problem of unemployment, even if that figure could be attained. There is conflicting evidence on that figure in the Select Committee report, and 25,000 is the highest figure that I have seen. It is much more realistic to suggest that, if all the wages councils were abolished, it might result in creating about 8,000 jobs. That has been the number of jobs lost month by month as a result of the Government's economic policies. Why are we wasting all this time, effort and money in investigating the future of the wages councils when the number of jobs that might be created, if the councils were abolished, is so small and puny and would make so little impact on unemployment?
  What we are witnessing is a charade in an attempt to divert attention from the high level of unemployment and its true cause—the Government's economic policies. If the Secretary of State were to announce tonight a change in the Government's policy towards the wages councils, he would get much more support than he is likely to get in the Lobbies.
  9.50 pm
  Mr. Tom King: With the leave of the House, I will respond to the points that have been made in this short debate.
  I said in my opening remarks that I appreciated the House having an opportunity to discuss this subject because the consultation period had just ended in terms of the formal public consultation. I said that we had received 667 responses from a range of organisations and individuals. I am, therefore, grateful for the opportunity that has been afforded for hon. Members to make their contributions as well.
  Mr. Foot rose—
  Mr. King: I think that I can answer the right hon. Gentleman, before he has even asked his question, by saying no.
  Mr. Foot: I intended to ask—
  Mr. Speaker: Order. We cannot have two right hon. Gentlemen on their feet at the same time. Is the Minister giving way?
  Mr. Foot: Will the right hon. Gentleman now answer the question that I asked earlier? Are there any objections or support for his view in the representations that he has received?
  Mr. King: The consultation paper suggested two alternatives, abolition or reform, and I assure the right hon. Gentleman, as I said in my opening remarks, that there was support for both possibilities.
  532
  It would be wrong of me not to say that I have received from some employers' bodies strong arguments for the retention of wages councils. Those bodies have included the Federation of Merchant Tailors, and I feel that I should put that on the record early in my contribution.
  The House will have noticed the vigour with which the debate has been conducted and I am under no illusions about the strength of feeling that exists in quarters of the House on this matter. There is a real difference of view. There are those who hold strong views about the present pattern of wages councils, covering an erratic series of shops in the high street. Earlier, I challenged any hon. Member to walk with me down a high street and be able to speak with certainty about which shops were and were not covered by the existing wages councils provisions. That point was clearly recognised by the hon. Member for Truro (Mr. Penhaligon).
  If I were to take a theme that has carried certain common ground across the Chamber, it would be that there is, without doubt, room for action. The hon. Member for Yeovil (Mr. Ashdown), part of whose speech I missed, referred to the case for sensible reform. The case for reform undoubtedly exists, and we start from that common ground.
  I cannot say that I am absolutely sure about the position of certain Labour Members, least of all those on the Labour Front Bench, who would oppose almost any change in any situation, no matter how obvious the case for it. In this situation, however, we have established a case at least for reform, and the argument that we now face is whether it should be reform or abolition.
  I am sorry that the hon. Member for Birmingham, Ladywood (Ms. Short) is not at present in her place. She referred to a leaked document and she seemed to chase every story on the subject. She referred to the obvious fact that there had been a leaked document on the pressures from senior civil servants unhappy with the policy. That was an unfortunate phrase for her to use. She is in a▪ position to know—because the person concerned is with an organisation with which she is connected—that a document has been removed from my Department.
  Sadly, it meant the end of the career of a young junior civil servant because he leaked the document of a senior civil servant, in this case the permanent secretary. I say that only in sorrow, and Opposition Members who gloat with great delight about leaked documents must have regard—[Interruption.] This applies particularly to the Labour Member who has aspirations to be in government. He should not gloat too much about the readiness of civil servants to hand out Government documents. If that hon. Member were in a different situation he might not think that to be in the best interests of Government organisation.
  My hon. Friend the Member for Bolton, North-East (Mr. Thurnham) was a member of the Select Committee and issued a minority report. He made his arguments clear to the House. The hon. Member for Ladywood promised that her party would fight the proposal all the way. but she cannot bear to be here for the closing speeches. I am sure that there is a reasonable explanation for her absence. I see that she has returned. She makes a late return to the battlefield and we are delighted to welcome her back. Not a single Labour Member of the Select Committee took part in the debate tonight.
  My hon. Friend the Member for Bolton, North␣East emphasised the heart of the issue — employment and jobs. My hon. Friend the Member for Bournemouth, West

  533
  (Mr. Butterfill) made it clear that even the Leader of the Opposition's advisers accepted that extra jobs will result. One can argue about how many extra jobs. That is important, but the key question is about the level of protection—if that protection is necessary for those in work—and about what impact it will have on preventing those out of work from having the chance of a job. Those issues are at the heart of the matter.
  My hon. Friend the Member for Bolton, North-East also raised another matter which I am sure that the House will consider further. He asked what was the relevance of such a form of wage protection in a society in which there might be family credit or some other form of family income support.
  I sought earlier to explain the different criteria against which the original trade boards were established and the different categories involved — the long hours and the insanitary nature of the working conditions. They are two of the three criteria on which the trade boards and the wages councils were established. The criteria are dealt with in different legislation and protected in different ways.
  I have listened to most of the debate. I shall study all the contributions. After the extensive consultation we shall reach decisions, not because of the vote tonight, but by giving serious consideration to representations. I do not intend to dismiss with contempt, as the motion invites, the 667 responses. They deserve serious consideration.
  The Government's amendment makes clear that those representations, with those from hon. Members, from the Select Committee and from the minority report by my hon. Friend the Member for Bolton, North-East, will be seriously considered. I commend the amendment to the House.
  Question put, That the original words stand part of the Question:—
  The House divided: Ayes 155, Noes 194.

  Division No. 231]

  [10 pm

  AYES

  Abse, Leo

  Clark, Dr David (S Shields)

  Alton, David

  Clarke, Thomas

  Anderson, Donald

  Clay, Robert

  Archer, Rt Hon Peter

  Clwyd, Mrs Ann

  Ashdown, Paddy

  Cocks, Rt Hon M. (Bristol S.)

  Ashley, Rt Hon Jack

  Cohen, Harry

  Atkinson, N. (Tottenham)

  Coleman, Donald

  Banks, Tony (Newham NW)

  Concannon, Rt Hon J. D.

  Barnett, Guy

  Conlan, Bernard

  Barron, Kevin

  Cook, Frank (Stockton North)

  Beckett, Mrs Margaret

  Cook, Robin F. (Livingston)

  Beith, A. J.

  Corbett, Robin

  Bell, Stuart

  Cowans, Harry

  Benn, Tony

  Cox, Thomas (Tooting)

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

  Craigen, J. M.

  Bermingham, Gerald

  Cunliffe, Lawrence

  Blair, Anthony

  Cunningham, Dr John

  Boyes, Roland

  Dalyell, Tam

  Bray, Dr Jeremy

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

  Brown, Gordon (D'f'mline E)

  Dewar, Donald

  Brown, Hugh D. (Provan)

  Dobson, Frank

  Brown, N. (N'c'tle—u—Tyne E)

  Dormand, Jack

  Bruce, Malcolm

  Dubs, Alfred

  Buchan, Norman

  Dunwoody, Hon Mrs G.

  Callaghan, Rt Hon J.

  Eadie, Alex

  Callaghan, Jim (Heyw'd & M)

  Edwards, Bob (W'h'mpt'n SE)

  Campbell—Savours, Dale

  Evans, John (St. Helens N)

  Canavan, Dennis

  Fatchett, Derek

  Carlile, Alexander (Montg'y)

  Faulds, Andrew

  534

  Field, Frank (Birkenhead)

  Mikardo, Ian

  Fields, T. (L'pool Broad Gn)

  Millan, Rt Hon Bruce

  Foot, Rt Hon Michael

  Morris, Rt Hon J. (Aberavon)

  Forrester, John

  Nellist, David

  Foster, Derek

  Oakes, Rt Hon Gordon

  Foulkes, George

  O'Brien, William

  Fraser, J. (Norwood)

  O'Neill, Martin

  Freeson, Rt Hon Reginald

  Paisley, Rev Ian

  Freud, Clement

  Patchett, Terry

  Hamilton, James (M'well N)

  Pavitt, Laurie

  Hamilton, W. W. (Central Fife)

  Penhaligon, David

  Hancock, Mr. Michael

  Pike, Peter

  Hardy, Peter

  Powell, Raymond (Ogmore)

  Harman, Ms Harriet

  Prescott, John

  Harrison, Rt Hon Walter

  Randall, Stuart

  Hart, Rt Hon Dame Judith

  Rees, Rt Hon M. (Leeds S)

  Haynes, Frank

  Richardson, Ms Jo

  Heffer, Eric S.

  Roberts, Ernest (Hackney N)

  Hogg, N. (C'nauld & Kilsyth)

  Robertson, George

  Holland, Stuart (Vauxhall)

  Robinson, G. (Coventry NW)

  Home Robertson, John

  Rowlands, Ted

  Howells, Geraint

  Sheerman, Barry

  Hoyle, Douglas

  Shore, Rt Hon Peter

  Hughes, Roy (Newport East)

  Short, Ms Clare (Ladywood)

  Hughes, Sean (Knowsley S)

  Silkin, Rt Hon J.

  Hughes, Simon (Southwark)

  Skinner, Dennis

  Hume, John

  Smith, Cyril (Rochdale)

  Janner, Hon Greville

  Snape, Peter

  Jenkins, Rt Hon Roy (Hillh'd)

  Soley, Clive

  John, Brynmor

  Spearing, Nigel

  Kaufman, Rt Hon Gerald

  Stewart, Rt Hon D. (W Isles)

  Kennedy, Charles

  Strang, Gavin

  Kilroy—Silk, Robert

  Straw, Jack

  Lamond, James

  Thomas, Dafydd (Merioneth)

  Leadbitter, Ted

  Thompson, J. (Wansbeck)

  Lewis, Terence (Worsley)

  Tinn, James

  Lloyd, Tony (Stretford)

  Torney, Tom

  Lofthouse, Geoffrey

  Wardell, Gareth (Gower)

  McCrea, Rev William

  Wareing, Robert

  McDonald, Dr Oonagh

  Weetch, Ken

  McKay, Allen (Penistone)

  Welsh, Michael

  McKelvey, William

  Wigley, Dafydd

  MacKenzie, Rt Hon Gregor

  Williams, Rt Hon A.

  McTaggart, Robert

  Wilson, Gordon

  Madden, Max

  Woodall, Alec

  Marek, Dr John

  Wrigglesworth, Ian

  Marshall, David (Shettleston)

  Martin, Michael

  Tellers for the Ayes:

  Maxton, John

  Mr. John Cartwright and

  Maynard, Miss Joan

  Mr. Michael Meadowcroft.

  Meacher, Michael

  NOES

  Aitken, Jonathan

  Butcher, John

  Alexander, Richard

  Butler, Hon Adam

  Alison, Rt Hon Michael

  Butterfill, John

  Amess, David

  Carlisle, John (N Luton)

  Ancram, Michael

  Carlisle, Kenneth (Lincoln)

  Arnold, Tom

  Cash, William

  Ashby, David

  Chalker, Mrs Lynda

  Baker, Nicholas (N Dorset)

  Channon, Rt Hon Paul

  Batiste, Spencer

  Chope, Christopher

  Bellingham, Henry

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

  Bendall, Vivian

  Clark, Dr Michael (Rochford)

  Benyon, William

  Colvin, Michael

  Biffen, Rt Hon John

  Conway, Derek

  Biggs—Davison, Sir John

  Coombs, Simon

  Blackburn, John

  Cranborne, Viscount

  Blaker, Rt Hon Sir Peter

  Crouch, David

  Boscawen, Hon Robert

  Currie, Mrs Edwina

  Bottomley, Mrs Virginia

  Dickens, Geoffrey

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

  Dorrell, Stephen

  Bowden, Gerald (Dulwich)

  Douglas—Hamilton, Lord J.

  Bright, Graham

  Dunn, Robert

  Brinton, Tim

  Durant, Tony

  Brittan, Rt Hon Leon

  Edwards, Rt Hon N. (P'broke)

  Brown, M. (Brigg & Cl'thpes)

  Eggar, Tim

  Bruinvels, Peter

  Evennett, David

  Buck, Sir Antony

  Fairbairn, Nicholas

  Burt, Alistair

  Fallon, Michael

  535

  Fletcher, Alexander

  Hunt, David (Wirral)

  Fookes, Miss Janet

  Hunt, John (Ravensbourne)

  Forsyth, Michael (Stir/ing)

  Hunter, Andrew

  Forth, Eric

  Jackson, Robert

  Fox, Marcus

  Jessel, Toby

  Franks, Cecil

  Johnson Smith, Sir Geoffrey

  Fraser, Peter (Angus East)

  Jones, Gwilym (Cardiff N)

  Freeman, Roger

  Kellett—Bowman, Mrs Elaine

  Gale, Roger

  King, Rt Hon Tom

  Galley, Roy

  Knight, Gregory (Derby N)

  Gardiner, George (Reigate)

  Knight, Mrs Jill (Edgbaston)

  Garel—Jones, Tristan

  Lamont, Norman

  Glyn, DrAlan

  Latham, Michael

  Goodhart, Sir Philip

  Lawler, Geoffrey

  Gorst, John

  Lawrence, Ivan

  Gow, Ian

  Lawson, Rt Hon Nigel

  Greenway, Harry

  Lee, John (Pendle)

  Gregory, Conal

  Lennox—Boyd, Hon Mark

  Griffiths, Peter (Portsm'th N)

  Lester, Jim

  Ground, Patrick

  Lilley, Peter

  Hamilton, Hon A. (Epsom)

  Lloyd, Ian (Havant)

  Hamilton, Neil (Tatton)

  Lloyd, Peter, (Fareham)

  Hampson, Dr Keith

  Luce, Richard

  Hanley, Jeremy

  Lyell, Nicholas

  Hannam, John

  McCrindle, Robert

  Hargreaves, Kenneth

  MacKay, Andrew (Berkshire)

  Harris, David

  MacKay, John (Argyll & Bute)

  Harvey, Robert

  Major, John

  Haselhurst, Alan

  Maples, John

  Hawkins, Sir Paul (SW N'folk)

  Marlow, Antony

  Hawksley, Warren

  Mather, Carol

  Hayes, J.

  Mawhinney, Dr Brian

  Hayward, Robert

  Maxwell—Hyslop, Robin

  Heddle, John

  Moate, Roger

  Henderson, Barry

  Moore, John

  Heseltine, Rt Hon Michael

  Morrison, Hon P. (Chester)

  Hind, Kenneth

  Murphy, Christopher

  Hirst, Michael

  Newton, Tony

  Hogg, Hon Douglas (Gr'th'm)

  Page, Richard (Herts SW)

  Holland, Sir Philip (Gedling)

  Percival, Rt Hon Sir Ian

  Holt, Richard

  Pollock, Alexander

  Howarth, Alan (Stratf'd—on—A)

  Powell, William (Corby)

  Howarth, Gerald (Cannock)

  Powley, John

  Hubbard—Miles, Peter

  Roe, Mrs Marion

  536

  Ross, Wm. (Londonderry)

  Thompson, Patrick (N'ich N)

  Rumbold, Mrs Angela

  Thornton, Malcolm

  Ryder, Richard

  Thurnham, Peter

  Sackville, Hon Thomas

  Townsend, Cyril D. (B heath)

  Sainsbury, Hon Timothy

  Tracey, Richard

  Sayeed, Jonathan

  Twinn, Dr Ian

  Shaw, Sir Michael (Scarb')

  Vaughan, Sir Gerard

  Shelton, William (Streatham)

  Viggers, Peter

  Shepherd, Colin (Hereford)

  Waddington, David

  Shepherd, Richard (Aldridge)

  Walden, George

  Sims, Roger

  Walker, Bill (T'side N)

  Skeet, T. H. H.

  Waller, Gary

  Spencer, Derek

  Ward, John

  Spicer, Jim (W Dorset)

  Wardle, C. (Bexhill)

  StanbroOk, Ivor

  Warren, Kenneth

  Steen, Anthony

  Watson, John

  Stern, Michael

  Watts, John

  Stevens, Lewis (Nuneaton)

  Wells, Bowen (Hertford)

  Stevens, Martin (Fulham)

  Wheeler, John

  Stewart, Andrew (Sherwood)

  Wiggin, Jerry

  Stewart, Ian (N Hertf'dshire)

  Wolfson, Mark

  Stradling Thomas, J.

  Wood, Timothy

  Sumberg, David

  Yeo, Tim

  Taylor, John (Solihull)

  Young, Sir George (Acton)

  Taylor, Teddy (S'end E)

  Terlezki, Stefan

  Tellers for the Noes:

  Thomas, Rt Hon Peter

  Mr. Ian Lang and

  Question accordingly negatived.
  Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 33 (Questions on amendments), and agreed to.
  MR. SPEAKER forthwith declared the main Question as amended, to be agreed to.
  Resolved,
  "That this House notes that the period for consultation on the consultative document on wages councils is only just ending and representations are still being received; and asks the Government to take into account the views of the Employment Committee, together with the very many other responses from interested organisations and individuals. '.

  Nuclear Non-Proliferation Treaty
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Durant.]
  Mr. Speaker: I have to tell the hon. Member for Bristol, East (Mr. Sayeed) that the digital clocks are incorrect, and that he should time his speech on the clocks at the end of the Chamber.
  10.15 pm
  Mr. Jonathan Sayeed: I shall look at the right clock.
  The debate on super power nuclear arms control is rarely out of the news, and rightly so. The waste of resources and the fear engendered by escalating nuclear arsenals is the frightening consequence of our inability to agree on a reversal of the nuclear arms race. The super powers' massive overcapacity in nuclear weapons, unbalanced though it is, will mean suicide for all, whoever initiates a nuclear war. Therefore, I believe that neither of the major powers, East or West, has people in control who are so malignant, so unfettered by the party or Government apparatus, to wish or to be permitted to consign his own countrymen and the rest of the world to ultimate destruction.
  Monstrous though the arms race is, I believe that our over-preoccupation with it, to the exclusion of all else, blinds us to the greater and growing danger of nuclear and atomic proliferation. I am convinced that if nuclear war ever broke out it would be initiated not by the super powers but by a nation without any sense of responsibility, where power is concentrated in the hands of the evil, the insane, or the bigoted dictator.
  That threat is real. To understand why that is so it is necessary for me to digress, and briefly explain how bombs are made, who has them and the effectiveness or otherwise of past and current controls.
  There are two methods to producing these weapons —the plutonium route and the separated uranium 235 route. The plutonium method originally required large plant and considerable expenditure, but utilised only moderately sophisticated technology. Nowadays, the plant is cheaper, but the technology is considerably more complicated and the plutonium bomb is difficult to explode.
  The uranium route previously required large and complex plant and was very expensive. Today, the plant is relatively cheap and compact, and the technology is well known to those who have the expertise to look it up. In a room the size of a large drawing room, one could make enough fissile material for one bomb a year, and that bomb is relatively easy to explode.
  Initially the control of nuclear and atomic knowledge went well. It was difficult to produce separated uranium 235 from uranium 238 by the diffusion process, the plant was cumbersome, expensive, fraught with technical difficulties, and the countries that had discovered uranium effectively controlled its export. Consequently, those nations that wanted to beat a path to the nuclear door were forced to follow the more expensive plutonium route by building heavy water research reactors, and in time a classic route developed for nations wishing to build a nuclear weapon. That route was that a state first obtained its natural uranium, then announced a civil nuclear programme to produce electricity and stated that it needed
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  to undertake research into its production. To do that, it had to build a heavy water reactor, which would make plutonium and hence the material for the plutonium bomb. That is what India has done at Trombay — using Canadian technology. It is what the Israelis say that Iraq was doing — using French technology — before Israel blew its reactor to pieces. It is what has been suggested that Argentina is doing, and Israel and Pakistan are alleged to be doing.
  However, there are drawbacks to this method. The technology is sophisticated, and hence costly, and because of their size a plutonium production reactor and associated reprocessing plant takes time to construct and in consequence its operation can be monitored externally and its capability quite easily estimated by experts.
  The passage of time and the advances in technology have made the second route, the uranium route, far more insidious. Using centrifuges or the jet process or lasers, uranium 235 is technically easier to produce than plutonium 239, the consequent bomb is easier to explode and, as I have indicated, the plant can simply be hidden or disguised.
  Thus the technology is known and the material is available, and Third world countries have grasped the opportunity. India exploded a weapon in 1974; Pakistan and Argentina have embarked on the centrifuge route to an uranium bomb; South Africa has embarked on the jet process route; Brazil and Israel are using a variety of methods. Some may have already reached their goal.
  It is sometimes simplistically suggested that if the major nuclear powers denied nuclear technology to other nations and removed the assistance they are already giving, all would be well. If the answer had been that simple, the world is still sane enough, and its leaders sensible enough, to have ensured that such a moderately simple action would have been taken. Indeed, that is what they have attempted. To begin with, the United States was able to impose controls to prevent other nations from acquiring a nuclear capacity by gaining a monopoly over the technical know-how and uranium deposits, and it worked—for a short time.
  As other western nations invested huge sums in gaining nuclear expertise, they felt the need to recoup part of their investment, and assist exports, by passing on their knowledge to Third world countries. In 1956 the Americans, through the United Nations, attempted to ensure that all countries in receipt of nuclear technology opened their programmes to inspection by the new International Atomic Energy Agency. The Soviet Union and other countries since have refused, although the Soviets may well be changing their mind because I have little doubt that they are as frightened about proliferation as we are.
  Many countries, including major suppliers such as France, refused to sign the non-proliferation treaty in 1968, for sovereignty or commercial reasons, or in the case of non-nuclear states, because they felt that by signing it they would not necessarily enhance their ability to obtain the promised benefits of civil nuclear power. Meanwhile, we and the United States recognised the problem but failed to deal with it. We have demanded "full scope safeguards", in other words, the right to inspect all nuclear facilities including those we have not assisted with, if we are to provide assistance with future civil nuclear plant. Many nations have refused to accept such conditions and, despite the cost, have gone it alone. Even

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  those countries that have signed the 1968 non-proliferation treaty, such as Japan and West Germany, find it easier under the terms of the treaty to sell nuclear technology to non-signatories such as Brazil, Argentina, Israel and Chile, than to those that have signed the treaty.
  Therefore, the treaty is failing in two ways. First, there are significant omissions among the countries subscribing to it—India, Pakistan, Israel, Argentina, South Africa, France, China, Chile and Brazil. Secondly, commercial considerations appear to persuade signatories to sell to non-signatory nations in preference to those who are signatories. Furthermore, the non-weapon states do not believe, or at least use as an excuse, that the nuclear states are complying with article 6, the disarmament clause. In addition, non-nuclear states fear that nuclear states will use the threat of cutting off nuclear supplies as an element of non-nuclear foreign policy if they deal with an NPT signatory. But all the countries that have recently obtained the technology to produce nuclear and atomic weapons attest that their only reason for investing in this technology is to enable them to have a civil nuclear programme. Maybe the best way to curtail proliferation is to take them at their word.
  The paradox is this. Whilst the major nuclear powers deny other countries access to nuclear technology, these countries always have the excuse that they require fissile material-producing research reactors in order to develop their own expertise in civil nuclear power generation.
  But the Soviets supply their Communist satellites with all nuclear services on the provision that all spent fuel is returned to the USSR for reprocessing, and they ensure that that happens. That is the model that we should adopt. By supplying the technology for nuclear reactors to Third world countries, but only leasing the nuclear fuel, which would have to be returned for reprocessing, there would be no excuse for building a pilot reprocessing plant, or for producing uranium 235 from uranium 238. Indeed, any country building such a plant would be doing so only in order to gain the facility for producing nuclear or atomic weapons. The existence of a plutonium plant would be difficult to hide from external view, and by ensuring that all spent fuel was returned, none of the plutonium could be purloined for the manufacture of weapons.
  I therefore believe that the non-proliferation treaty must be amended to permit the major nuclear nations to supply the technology required for the construction of nuclear power plants and the associated fuel cycle services on the understanding that: first, the nuclear fuel is only leased and must be returned for reprocessing; second, the recipient agrees not to engage in a uranium or plutonium weapons-building programme, or develop its expertise in those directions; and, third, an internationally agreed inspectorate is permitted to examine all civil nuclear plants as part of the "nuclear fuel leasing service".
  As the recipient country will know that its development of plutonium bombs can be monitored, it will be put off from doing so by the certain knowledge that it would lose assistance with its civil nuclear programme. Once the recipient invests in that programme, the power generated and other trade and commercial considerations will be so great that the donor nations will be able to exert an effective pressure if the recipient ever appeared to be undertaking the atomic bomb route.
  But the donor nations will also have to provide assurances. They will have to agree not to curtail nuclear supplies or services for reasons other than non-compliance
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  with the three reasons I have given, or in the event of war. They will need to do that to reassure the eventual recipient that he will not be cut off from nuclear power generation.
  Some have suggested that the non-proliferation treaty needs to be enforced more rigorously, and that that is all that is necessary. I do not agree. I believe that entrenching failure — because I believe that the non-proliferation treaty has failed, and I have demonstrated that it has failed —is not the answer. There is not time between now and September to rewrite and renegotiate a new treaty. Let us keep the current treaty and renegotiate a new treaty in a year's time or perhaps later. I feel that the Soviets would be interested in that.
  While the world is in the midst of recession and while development of civil nuclear programmes is so expensive, my suggestion might have some chance of success. But with the world coming out of recession and nuclear expertise becoming more widespread, that chance is slipping away. It is not too late for our world to limit nuclear and atomic weapons, but it could soon well be.
  10.28 pm
  The Minister of State, Foreign and Commonwealth Office (Mr. Richard Luce): I warmly congratulate my hon. Friend the Member for Bristol, East (Mr. Sayeed) on raising this debate on what is undoubtedly an extremely important issue relating to the nuclear non-proliferation treaty. He has done a great service. I assure him that I shall consider carefully the detailed and well-thought-out points that he raised. If I cannot answer them all in the debate, I shall write to him in more detail.
  The spread of nuclear weapons to countries that do not now possess them would have the gravest consequences for mankind, as my hon. Friend said. The chief barrier against such proliferation is the non-proliferation treaty, which bans the transfer by nuclear weapon states of nuclear weapons to any other recipient, and their acquisition or manufacture by non-nuclear weapon states. The treaty therefore increases the security of the world and the Government are strongly committed to supporting and strengthening it.
  Negotiating the treaty in the 1960s was a major diplomatic achievement and Britain can be proud of having helped to draft it and of having been among the earliest to sign it. As my hon. Friend has said, the third review conference of the treaty will take place this August. We attach considerable importance to this meeting and have played our part as a depository Government in convening it.
  I differ from my hon. Friend in his judgment about the success or failure of the treaty. I believe that it has been successful. In the 1960s it was predicted that there would be up to 20 additional nuclear weapon states by 1985. In fact, only one further state—India, which is not a party to the treaty in 1974 — demonstrated the capacity to detonate a nuclear explosive device. That may be partly because nuclear proliferation is not so straightforward technically as my hon. Friend suggests, but much of the credit must go to the existence of the treaty. The treaty is the most widely supported arms control agreement in existence, with nearly 130 parties or four fifths of the United Nations membership, and no state has exercised its right to withdraw from the treaty.
  I do not entirely share my hon. Friend's view that the treaty is failing simply because there are significant non-parties, although the non-participation of those states is

  541
  clearly a weakness. The vast majority of the world community has adhered to the treaty and that fact alone is of the greatest importance to the security of all states whether or not they are parties to the treaty.
  Clearly the treaty would be even more effective if membership were universal. In collaboration with other states party to the treaty, we have been lobbying most of the 40 or so non-parties to accede to the treaty. In the past year, eight have done so, four of them in London, thus demonstrating the treaty's continued vitality.
  Two states which possess nuclear weapons—France and China—are not parties to the treaty, but France has said that she will act as though she were a party and China has stated that she does not advocate or encourage proliferation.
  Among the non-parties which do not possess nuclear weapons several have significant nuclear facilities not open to international inspection. My hon. Friend has 'referred to some of them. They are Argentina, India, Israel, Pakistan and South Africa. We attach particular importance to membership of the treaty by those countries and will continue to co-operate in international efforts to urge them to accede to the treaty. Pending their accession or their acceptance of internationally supervised safeguards on all their nuclear facilities, our policy is not to export nuclear materials, equipment or technology to them except for unambiguously peaceful purposes and then only on a very carefully controlled basis.
  Article 3 of the treaty refers to safeguards, on which my hon. Friend has expressed some interesting and important views. He suggests that the treaty should be amended so that fuel would be leased to recipient countries and returned to the supplier for reprocessing, that the recipient should agree not to build nuclear weapons and that an internationally agreed inspectorate should examine all civil plants as part of what my hon. Friend described as nuclear fuel leasing services.
  I sympathise very much with my hon. Friend's motives in putting forward those ideas, and I certainly appreciate his concern for adequate safeguards, which is at the heart of the agreement. Nevertheless, I believe that we should be very cautious about any proposals to amend the treaty itself. Any amendments must be approved by a majority of the nearly 130 parties to the treaty. Even if it were possible to win sufficient support, any proposed change would give rise to floods of other amendments that we might not be able to support. I believe, therefore, that it is much better to leave the text of the treaty unaltered so as not to endanger the whole treaty which has served us well.
  I remind my hon. Friend of the vital role already played by the International Atomic Energy Agency safeguards in verifying the binding international legal obligations which the treaty imposes on non-nuclear weapon state parties not to manufacture or acquire nuclear weapons or other nuclear explosive devices. Article III requires such safeguards to be applied to all source or special fissionable material anywhere in the territory of the state concerned or under its jurisdiction or control. Safeguards are designed to detect the diversion of such material away from peaceful uses. All our exports of fissionable material or equipment designed for its processing or use to any non-nuclear weapon state have been subject to safeguards under the existing terms of the treaty. I pay tribute to the
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  valuable role of the IAEA in administering the safeguards system. The United Kingdom will continue to co-operate fully with IAEA safeguards and will assist the agency's efforts further to improve the system. I shall be visiting Vienna next week to learn more about the agency's work.
  My hon. Friend may also wish to be reminded that we are one of 22 countries which apply the Nuclear Suppliers' Group guidelines to our exports of nuclear materials, equipment and technology to any non-nuclear weapon state for peaceful purposes. The guidelines reinforce the treaty. In addition to requiring IAEA safeguards on the items transferred, the guidelines require formal governmental assurances to be obtained from the recipient that the exported item will not be used to manufacture nuclear explosive devices, that it will be protected against theft or sabotage, and that if it is re-exported the new purchaser will be required to give the same assurances as the original customer. In the case of enriched uranium or plutonium, the prior consent of the original supplier must be obtained before re-transfer can take place. The guidelines also urge restraint on the transfer of sensitive technology such as reprocessing or enrichment facilities. I believe that the existing requirements go far to meet my hon. Friend's concerns.
  As to the specific proposal for fuel leasing, the suggestion is not entirely new and certainly has some attractions. However, the system could not now be watertight because the treaty member states are not the exclusive suppliers of nuclear fuel. As for the establishment of an international inspectorate, that already exists in the form of the IAEA. We should continue to support efforts to extend IAEA safeguards to cover all nuclear facilities in all non-nuclear weapon states that are not parties to the treaty. We are doing all that we can to promote universal adherence to the treaty.
  Article IV is an important part of the treaty, which deals with the peaceful use of nuclear energy. When the treaty was negotiated, many non-nuclear weapon states believed that if they were to forgo the option to manufacture or acquire nuclear weapons, this should not be at the expense of their right to use nuclear energy for peaceful purposes. For that reason, article IV of the treaty both reaffirms that right and enjoins all parties to facilitate the fullest possible exchange of equipment, materials and technology for peaceful purposes.
  In association with the safeguards required for article III, article IV seeks to promote the safe expansion of peaceful nuclear trade, but minimises the risk of nuclear proliferation. That can help the economic development of many. of the member states. We have fully complied with our obligations under this article. As one of the first countries to use nuclear energy for peaceful purposes, we have considerable experience in the area and will continue to share our expertise with other countries, within the limits imposed by our overall non-poliferation policy.
  The other important article in the treaty—article VI —deals with disarmament negotiations. It embodies the common determination of the parties to work for nuclear disarmament. The Government are strongly committed to the goals of this article. Therefore, we warmly welcome the arms control negotiations in Geneva between the United States and the Soviet Union. We fully support the agreed objective of preventing an arms race in outer space, and terminating it on earth. Negotiations between the superpowers, which possess 95 per cen. of the world's

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  nuclear weapons, are the first priority in pursuing the effective nuclear disarmament measures prescribed by the treaty.
  Some critics maintain that the first step towards fulfilment of article VI is the negotiation of a comprehensive test ban. I hope to explain the Government's views on this issue at greater length in the Adjournment debate which is planned for tomorrow and is to be raised by the hon. Member for Edinburgh, East (Mr. Strang). All I say at this stage is that, in my view, it would serve no one's interest for progress towards a comprehensive test ban—which is of great importance— to be artificially linked to the continued adherence to the non-proliferation treaty and its future. The non-proliferation treaty is important in its own right. We must not jeopardise it by holding it hostage to progress in other areas, however important they may be.
  We are actively preparing for the treaty review conference which begins at the end of August. We have taken a full part in the work of the preparatory committee in which we chaired the group of Western countries. We have maintained close contact with other member states, including in particular the United States and the Soviet Union. It is worth emphasising that non-proliferation is an area of foreign policy where the views of both East and West largely coincide, as my hon. Friend acknowledged in his speech. As a Government we approach this review conference in a positive and constructive spirit.
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  I shall be attending the conference and will deliver the main British statement in the general debate. Our aim is to provide an outcome which maintains, and if possible strengthens, this arms control treaty. This will be facilitated if the parties review the treaty as a whole in a balanced manner, recognising its success in preventing horizontal proliferation and promoting the peaceful use of nuclear energy. We are not complacent about the review conference but are encouraged by the progress made by the preparatory committee and the flexibility and good will displayed by those member states which participated in its work.
  I believe that the arms control talks in Geneva between the United States and the Soviet Union will improve the atmosphere of debate on article VI; because such negotiations are precisely what this article requires. Once again, we urge all non-parties to reconsider their position and to adhere to this indispensable treaty which has done so much to make the world a safer place.
  I am grateful to my hon. Friend for raising this issue, and I assure him that I shall give very careful thought to the specific points he has raised.
  Question put and agreed to.
  Adjourned accordingly at eighteen minutes to Eleven o'clock.