Commons Sitting of 21 January 1986

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

PRIVATE BUSINESS
POOLE BOROUGH COUNCIL BILL [Lords]
Order for Third Reading read.
Queen's consent, on behalf of the Crown, signified.
Read the Third time, and passed, with amendments.
BERKSHIRE BILL [Lords]
Order for consideration read.
To be considered upon Thursday.
SWANSEA CITY COUNCIL (TAWE BARRAGE) BILL [Lords]
Order for Second Reading read.
To be read a Second time upon Thursday.

PRIVATE BUSINESS

  LOTHIAN REGION (EDINBURGH WESTERN RELIEF ROAD) ORDER CONFIRMATION BILL
  Motion made, and Question proposed,
  That the provisions of paragraph (4) of Standing Ordee appr 243 (Joint committees on petitions) be applied to the Committee appointed to join with a Committee of the House of Lords as the Joint Committee on the Lothian Region (Edinburgh Western Relief Road) Order Confirmation Bill. —[The Chairman of Ways and Means.]
  Hon. Members: Object.
  To be considered upon Thursday.

Oral Answers to Questions
  EMPLOYMENT

    Labour Statistics
    Mr. Leightonasked the Paymaster General how many full-time employees there were in employment in 1979, 1983 and 1985, respectively.
    The Parliamentary Under-Secretary of State for Employment (Mr. Alan Clark): Estimates of full-time and part-time male employees in employment are not separately available for these dates. In June 1979 there were 18,768,000 male employees and full-time female employees in employment. The corresponding estimates for 1983 and 1985 are 16,626,000 and 16,490,000 respectively.
    Mr. Leighton: Do the figures not show the full enormity of what has happened, the destruction of 2·5 million full-time jobs since 1979 and, in the past two
    168
    years, the destruction of 750,000 full-time jobs? The only growth in recent times has been in a secondary labour market of an under class of female part-time labour with no employment protection, low pay, no holiday pay, no sick pay, and no pension rights. That is accompanied by a continued relentless destruction of full-time jobs.
    Mr. Clark: That is exactly what the figures do not reveal. The hon. Gentleman is presumably drawing on the expert acquaintance of such matters that he has acquired in his distinguished service as Chairman of the Select Committee. He has chosen to use the arcane statisticians' definition of employees in employment instead of the more usual definition of the employed labour force. Had he chosen to use the employed labour force, which is the usual category by which the figures are judged, he would have seen that the number of jobs has increased by 709,000 since 1983, and that the total lost since 1979 has been just over million.
    Mr. Kenneth Carlisle: Does my hon. Friend agree that there were 1,800,000 in self employment in 1979? There are now 2,500,000. That is an encouraging increase, because if each unemployed person creates a good business, he can employ more people. That is a major area of employment growth.
    Mr. Clark: My hon. Friend is entirely right and doubtless it is for that reason that the hon. Member for Newham, North-East (Mr. Leighton) deliberately selected that category, which excludes the self employed from his total.
    Mr. Wainwright: Will the Minister stop the misleading practice, when preparing the figures of employment, of treating men's part-time jobs as the full equivalent of men's full-time jobs? Is there any reason why the House should continually be misled by that failure to distinguish?
    Mr. Clark: A job is a job. I am surprised to find the hon. Gentleman, speaking as he does for the Liberal party, adhering to that rigorous Stakhanovite doctrine held by so many members of the Opposition that everybody should be fully working the entire time.
    Mr. Yeo: Will my hon. Friend join me in rejecting the implications behind some supplementary questions that part-time work is in some way inferior to other forms of work? In practice, part-time work provides welcome and satisfying opportunities for employment. It makes an important contribution to the economy as a whole and is often very much welcomed by employers.
    Mr. Clark: My hon. Friend is right. The majority of those who work part time do so from choice and not from pressure.
    Mr. Evans: Do not the carefully selected figures that the Minister has presented to the House show clearly the employment disaster that has struck the United Kingdom as a result of the Government's economic policies? As the Minister is keen to boast about self-employment, will he provide the figures showing the growth in self-employed labour known as "lump labour" in the construction industry, which has been rapid over the past two years?
    Mr. Clark: I understand that the hon. Gentleman has to make these ritual declarations once a month. Those who are self-employed, proud of their status and conscious of the expanding opportunities that they give others—many

    169
    of them are offering employment as their businesses grow and flourish—will resent the aspersions that the hon. Gentleman is casting upon them.

    Tourism
    Mr. Bevanasked the Paymaster General what progress has been made in Government policy towards tourism since the publication of the document "Pleasure, Leisure and Jobs".
    The Parliamentary Under-Secretary of State for Employment (Mr. David Trippier): The Government are continuing to place a high priority on encouraging the development of tourism and on maximising the industry's potential for growth, job creation and enterprise. Since the transfer of responsibility for tourism policy to the Department of Employment in September, we have announced a substantial increase in the financial provision next year for the British Tourist Authority and the English tourist board, bringing their total provision to £40 million.
    Mr. Bevan: I am delighted to hear of the further progress that has been made following the report to which many of my colleagues and I contributed as members of the party tourism committee. Will my hon. Friend be kind enough to give details of precisely where the money will be distributed to benefit areas of high unemployment such as my own, greatly increasing tourism activity.
    Mr. Trippier: I am grateful to my hon. Friend for his initial remarks. Discussions are currently taking place with the British Tourist Authority and the English tourist board to decide how we will split between them this money and section 4 tourist assistance. We intend to concentrate a substantial part of the money in areas where we can develop tourist attractions and where unemployment is higher.
    Mr. Donald Stewart: In meeting the two aims that the Minister has enunciated, will he reject the findings and recommendation of the Select Committee that the United Kingdom tourist boards should be merged into one?
    Mr. Trippier: As the right hon. Gentleman knows, we have received the report of the Select Committee on Trade and Industry. Our considered response will be available in the near future.
    Mr. Butterfil: What steps does my hon. Friend intend to take to alleviate the appalling delays that are being encountered by early-morning travellers at Heathrow, where passengers are treated almost like cattle?
    Mr. Trippier: If they were cattle, we would probably be prosecuted. My hon. Friend has made a valid point and identified one of the 32 action points that are highlighted in the Young report apprised entitled, "Pleasure, Leisure and Jobs: The Business of Tourism". I have recently had a meeting with my hon. and learned Friend the Minister of State, Home Office, and I am fully apprised of the importance of the matter to which my hon. Friend has drawn the attention of the House.
    Dr. M. S. Miller: Valuable as tourist jobs are, they do not compensate for the loss of industrial jobs. What is the Minister doing to convince his right hon. and hon. Friends to save the steel industry in Scotland?
    Mr. Trippier: The hon. Gentleman is using an ingenious device to raise a matter which is not connected
    170
    directly with the substantive question. The issue which he has raised is one of balance. The Department of Employment is concerned with all these matters. I suggested in my main reply that we have a sector that has enormous wealth-creation and employment-creation potential. Perhaps that has been overlooked in the past. We are now intent on developing that potential to the full.

    Labour Statistics
    Mr. Heathcoat-Amoryasked the Paymaster General why he uses the number of people drawing unemployment benefit as a definition of the unemployment total.
    The Paymaster General and Minister for Employment (Mr. Kenneth Clarke): We have no administrative means of producing quickly, accurately and at reasonable cost each month the precise number of people without jobs who are actively seeking work, which would be my definition of unemployment. As the best monthly snapshot measure of that number, we can produce statistics based on records of people claiming benefits. In practice, these statistics usually prove to be broadly in balance with the figures produced by our less frequent survey estimates of the number of people unemployed.
    Mr. Heathcoat-Amory: Does my right hon. and learned Friend agree that the number drawing benefit include many people, such as married women with children and people who take early retirement, who are not actively seeking work? Should not the published official statistics for the unemployment total reflect more accurately the number of people actually looking for work?
    Mr. Clark: In considering the figures one has to bear in mind that at the time of the last survey about 940,000 people claiming benefit had not recently been seeking work, but about 870,000 people not drawing benefit say that they would take work if it were available. As a result, the figures produced each month and the results of the periodic detailed surveys are roughly equivalent. There is no cheap and easy way to be more precise than that.
    Mr. James Hamilton: Does not the fact that many unemployed people are not drawing benefit prove, as we have said many times, that the figures are falsified and do not represent the true level of unemployment?
    Mr. Clarke: I invite the hon. Gentleman to study what I have just said. From the number of claimants one must deduct the number who do not appear to be seeking work, perhaps for good reasons, but one must add the number not receiving benefit but seeking work. The result is about 3 million. It serves no useful purpose for the Opposition to load on top of the official figures all kinds of categories of people to produce the inflated figure of 4 million to which so many Opposition Members refer.
    Mr. Ralph Howell: Does my right hon. and learned Friend accept that the labour force survey figures merely confuse the issue? Does he agree that the question posed by my hon. Friend the Member for Wells (Mr. HeathcoatAmory) is much more serious, because many people not receiving unemployment benefit are classified as unemployed because benefit has been disallowed? Does he agree that we shall never have meaningful unemployment figures until a work test is instituted, as envisaged in the Beveridge report, on which the welfare state is based?
    Mr. Clarke: My hon. Friend rightly points to the confusion and attempts to clarify the position. The key point is that there are too many people out of work and seeking work. That is why the Government are actively pursuing steps to increase the number of new jobs created. It serves no useful purpose to inflate the unemployment total, as the Opposition do. It is important to bear in mind that all those claiming benefit should be available for work. That is the test of eligibility for benefit, and the Government are entitled to take steps, as we are doing, to ensure that benefit is paid only to people genuinely available for work.
    Mr. Foot: Does the Minister admit that for several years the Opposition have been asking questions about the unemployment figures and the Minister has been saying that that is not fair and that we should ask about the number of people in employment, but now that we put down questions about employment he says that that is even more unfair?
    Mr. Clarke: Questions about employment have just been answered very clearly by my hon. Friend the Parliamentary Under-Secretary of State. We welcome as many questions as possible about employment and the creation of new jobs, because our best estimates are that about 709,000 new jobs have been created since the last general election.
    Mr. Watts: Does my right hon. and learned Friend agree that out of the 3 million unemployed only 379,000 are registered at jobcentres? Does he further agree that the jobcentres are hampered in seeking to fill the vacancies for skilled labour that many employers have, especially in my constituency in the Thames valley? Will he carefully consider a further pilot scheme to require the unemployed in areas of low unemployment and clear skill shortage to register at jobcentres so that the jobcentres can actively seek to match the unemployed to the vacancies?
    Mr. Clarke: Registration at jobcentres is now voluntary, and only just over 400,000 choose to register. As more jobs are now being notified to jobcentres, in a number of pilot areas we have launched proposals to get in touch, first, with the long-term unemployed to bring them to the jobcentres so that jobs, training, job club membership and so on can be offered to them. This has been very successful in a number of areas.
    Mr. Prescott: Does the Postmaster General accept—[interruption.] Does the Paymaster General accept that if there is any confusion about the figures being inflated, it is because the Government spend all their time deflating the figures by massaging them downwards? If the Government used the previous criteria for those who are registered as unemployed, unemployment figures would be about half a million more than they are now.
    Does the Paymaster General accept that the December unemployment figures—his registration figures—are the highest ever recorded? Would he care to guess whether the January figures will be a further record of mass unemployment resulting from the Government's policies?
    Mr. Clarke: I have been entirely clear about our figures. It is no good the hon. Member complaining about the inadequacy of the figures, when every time that we seek to improve them he accuses us of fiddling them. There is no point in the hon. Gentleman, as he consistently
    172
    does, seeking to inflate those figures in bogus ways to produce the figure of 4 or 5 million, or whatever figure that he uses in his speech.
    The December figures follow three successive months in which the total was falling. We shall wait to see what the underlying trend is. The trend during the past six months seems to be the best that we have had for a long time. With the economy growing at its present rate, I expect the outlook for 1986 to be very good.

    Local Enterprise Agencies
    Mr. Colvinasked the Paymaster General what steps he proposes to take to encourage large firms to second some of their executives to local enterprise agencies.
    Mr. Trippier: Business in the Community is taxing the lead in encouraging an increase in secondments to local enterprise agencies from large firms. Such secondments can qualify for tax relief. The Government fully support BIC's efforts in this area.
    Mr. Colvin: I am sorry that the "Pastemaster General" is not answering this question. Will my hon. Friend acknowledge that without the help of big business "oak trees", the small business "acorns", which are catered for by enterprise agencies, would be unlikely to take root? Will my hon. Friend pay tribute to The British American Tobacco, Co., which is assisting the Solent enterprise agency to get off the ground? Without its aid the agency would probably not have prospered. Will he use his best endeavours to encourage other big businesses to help enterprise agencies in the same way?
    Mr. Trippier: My hon. Friend is right. I join him in complimenting BAT on the way in which it has sponsored the Solent enterprise agency by providing a secondee. I pay a warm tribute to the growing number of large firms which are seeking to help small businesses, indirectly or directly, in this way.
    Mr. Bellingham: Is my hon. Friend aware that we have been setting up an enterprise agency in King's Lynn? Will he tell the House what he plans to do about seconding more civil servants to local enterprise agencies? Does he agree that a spell at the sharp end of the private sector would do their career development much good?
    Mr. Trippier: My hon. Friend has been giving us a month-by-month account of the progress of his enterprise agency. I am glad that he has drawn the attention of the House to the agency, which comes into operation this week.
    We welcome the fact that civil servants can be seconded to enterprise agencies. When I became a Minister two and a half years ago, we did not have civil servants seconded to enterprise agencies or to BIC. There are now eight such civil servants, who are not confined to the Department of Employment. We even have a secondee from the Treasury, so it must be a good idea.

    Average Earnings
    Mr. Maplesasked the Paymaster General what has been the underlying increase in average earnings over the last year.
    Mr. Alan Clark: The underlying increase in average weekly earnings in the year to November 1985 was 7·5 per cent. This should not be confused with the average

    173
    increase of pay settlements, which will be lower as the figure for earnings includes overtime, bonuses and similar factors.
    Mr. Maples: Does my hon. Friend agree that, in present circumstances, both figures are too high, and that although averages can conceal a great deal, it is vital that individual businesses do not grant pay awards which increase their real unit costs? In that respect, should we not learn the lesson of the United States, where recently millions of new jobs have been created when real average earnings have fallen?
    Mr. Clark: I appreciate the expert knowledge which my hon. Friend, as the author of a booklet on the subject, brings to the matter, but it is inappropriate for a Minister to say that any wage increase is too high, as an abstract concept. It is not for the Government to intervene in bargaining between employers and employees. None the less, my hon. Friend is perfectly right to draw attention to unit costs and productivity, on which our competitiveness rests.
    Mr. Skinner: Is the Minister aware that one reason why the increase was about 7·7 per cent. was that the Government gave the green light to those at the top end of the salary scale last year when they awarded a 19 per cent. increase to those earning top salaries? As a result, executives and other types managed to rope in another 17 per cent. during 1985. Is it any wonder that the average has increased to more than 7 per cent.? The trouble is that those at the bottom end have been hammered by the Government since 1979.
    Mr. Clark: The Top Salaries Review body is completely independent, and the House would take a poor view of any Government interference in its deliberations. The hon. Gentleman's arithmetic is rather confused. The recipients of those awards were so few in number that they could not possibly affect the statistical average of the increase in earnings.
    Mr. Baldry: Since pay in British manufacturing industry is increasing twice as fast as that in Japan and the United States, it can only mean that our manufactured goods will become consistently less competitive, which means that fewer are made, fewer are sold and there are fewer jobs. How do we stop this national lunacy of pricing ourselves out of work?
    Mr. Clark: There is much truth in what my hon. Friend says, but I would not wish to be associated with any dirigiste intervention in the bargaining between employers and employees. Employers must see the sense of my hon. Friend's argument reflected in their order books.

    Wages Councils
    Mr. Ray Powellasked the Paymaster General how many workers are currently covered by wages councils; and what proportion are under 21 years of age.
    Mr. Kenneth Clarke: About 2·75 million workers are covered by wages councils. Of these, approximately 20 per cent. are under 21 years of age.
    Mr. Powell: Is the Paymaster General aware that my union—the Union of Shop, Distributive and Allied Workers—has expressed much anxiety about the suggestion that the Government might amend or abolish
    174
    the wages council for shop workers? Is he also aware that the Shops Bill, which is now in the other place and which deals with the introduction of Sunday trading, will remove controls over young people working in shops? They can no longer benefit from wages council protection. Will the Minister tell the House what proposals the Government have in mind?
    Mr. Clarke: I am happy to repeat that it is the Government's firm intention to introduce a Bill this Session to reform the wages councils. We propose to reduce the powers of the wages councils so that they can specify only one basic rate and one overtime rate. We also propose to remove employees under the age of 21 from the scope of wages councils. Our motive for doing so is that we believe that, by setting young people's wages too high in relation to adult wages, and too high in relation to the value that they add to a business, we are making more youngsters unemployed than we need to. The reform will increase the potential for more youth employment.
    Mr. Grylls: Does my right hon. and learned Friend agree that the argument in favour of removing wages councils, at least for those aged under 21, has been won and established in the public mind, even if not in the mind of the Opposition? If wages councils destroy or deter the creation of new jobs, they are ineffective and we had better get rid of them anyway. On both counts, it would be much better to get rid of them.
    Mr. Clarke: I trust that we have won the public argument. When we introduce the Bill we shall discover the extent to which we have won the parliamentary argument. I agree with my hon. Friend's arguments and conclusions. The wages councils have quite unintentionally reduced the number of jobs that are made available to young people in this country.
    Ms. Clare Short: Can the Paymaster General explain why the Government intend to weaken the protection that is afforded to 3 million workers, including ½ million young workers, who are paid very low wages? According to the "New Earnings Survey," since 1979 the top 20 per cent. of workers have increased their pay above the average, but the bottom 20 per cent. had pay increases that were lower than the rate of inflation. They have, therefore, suffered a net drop in income. This proposal will ensure that they are paid even less.
    Mr. Clarke: My first priority is the interests of the 3 million or so people who are unemployed, in particular the young unemployed who are included in that total. If the wages councils continue to stipulate extremely complex pay arrangements in very important trades, and continue to set for young employees pay rates that are too high in relation to pay rates for experienced adults, the effect will be to reduce the number of jobs that are made available to young people in this country. The wages councils are therefore out of date in those respects and it is high time that we reformed them.

    Northern Region (Job Clubs)
    Mr. Fallonasked the Paymaster General whether his Department will establish more job clubs in the northern region.
    Mr. Alan Clark: The Manpower Services Commission at present runs 30 job clubs, four of which

    175
    are located in the MSC's northern region. Initial results are very encouraging, and about two thirds of the people who have joined job clubs have found jobs. Provided that evaluation confirms this, I have asked the commission to make plans for a rapid expansion to establish a national network of 200 job clubs by the end of this year. These plans will certainly include proposals to open a number of additional job clubs in the MSC's northern region.
    Mr. Fallon: I am very grateful for that most heartening answer. Is my hon. Friend aware that this experiment is proving to be very successful? Does he agree that personal, in-depth counselling is of far more assistance to the long-term unemployed than any amount of artificial indignation that may be expressed by the Opposition?
    Mr. Clark: Yes. It has been one of the most successful of the Government's initiatives. The number of people who find jobs after having been on one of these courses in the northern areas is, on average, about three quarters of those who attend such courses. In March 1985 I visited the first experimental job club in Durham, and I was so impressed by what I saw that the Department put in train this considerable expansion.
    Mr. Campbell-Savours: Will not the recent rate support grant settlement under which the Government are imposing a 35 per cent. rate increase upon Cumbrians wipe out at a stroke all the benefits of the enterprise incentives that have been introduced by the Government during the last few years? Are they not creating unemployment on the one hand and introducing on the other a number of palliative measures, such as job clubs and enterprise allowances?— [Interruption.] That is absolutely in order, if the Minister would only listen and stop protesting. He will have an opportunity to answer the question. Is it not true that the enterprise allowances and the other so-called incentives will be wiped out by the rate support grant settlement?
    Mr. Clark: The hon. Gentleman has probably been having a nap and has confused the subject and the day upon which his question should be put. Whatever extraneous circumstances may prevail, experience shows that those who go through the job clubs are better suited to place themselves in the employment market than those who do not.
    Mr. Dickens: I congratulate my hon. Friend on the widespread introduction of job clubs. Is it not a fact that those who join job clubs to learn new skills and interviewing techniques are the kind of people for whom employers are looking?
    Mr. Clark: Yes. They are more likely to be the people for whom employers are looking when they emerge from job club courses than they were when they went on to those courses. It is an established, regrettable truth that those who have been out of work for a very long time lose self-confidence. They lose familiarity with the labour market. They also lose the ability to project their personality and their skills. It is to help them to recover their self-confidence that job clubs have been instituted.
    Mr. Evans: Is it not time that the Minister admitted that what the long-term unemployed want, many of whom are over 50 and have been unemployed for three, four or five years, are jobs, real live jobs? As long as this Government are in office, it is obvious that they will not
    176
    get jobs. Will the Minister confirm what my hon. Friend suggested earlier, that the December figures for unemployment are the highest ever recorded?
    Mr. Clark: The hon. Gentleman paints in far too pessimistic a colour. The Government are engaged on a much broader initiative of contacting long-term unemployed people. That initiative embraces many different types of action, of which job clubs are only one part. There is the job-start scheme with its £20 grant and the personal contact initiative. Many such initiatives are being favourably received and successfully implemented.

    Youth Training Scheme
    Mr. Spencerasked the Paymaster General what is the total funding for the youth training scheme in England in the current financial year.
    Mr. Trippier: We have made available £710 million for the youth training scheme in England in 1985–86. Including Scotland and Wales, total funding is £834 million.
    Mr. Spencer: Is my hon. Friend aware of the Leicestershire employment and education project on Constitution hill in my constituency? That is a YTS project and provides basic training for disadvantaged young people from the inner area. It has a high success rate and has contributed to a reduction in unemployment in my constituency of some 6·2 per cent. since September 1984.
    Mr. Trippier: I am pleased to learn that there has been such a significant fall in the level of unemployment in my hon. and learned Friend's constituency, and I am grateful to him for paying such a warm compliment to the Leicestershire employment and education project. As he suggests, there is now ample evidence, not only in his constituency but throughout the country, that the YTS is effective in providing for a real need.
    Mr. Caborn: Is the Minister aware that in the inner cities there are major problems with YTS, particularly in the voluntary sector? Many people in the inner cities are worried about the new arrangements for funding and about their ability to provide the type of training that has hitherto been provided. Many people, particularly in the caring services, will not go into any type of training, and they will be a major problem, particularly for the inner cities. Will the Minister give consideration to representations from organisations such as NACRO and others?
    Mr. Trippier: I will certainly give serious consideration to the point made by the hon. Gentleman and draw his remarks to the attention of the Manpower Services Commission. The number of premium places under the new scheme is designed to meet the needs of young people with particular training needs for whom employer-based places will not suffice. I told the hon. Gentleman that at a meeting that I had with him, but if he wishes to come back and explore the ground further, I shall be happy to do so.
    Mr. Rowe: My hon. Friend knows that I am an enthusiastic supporter of the YTS. Will he accept that one of the ingredients in the demoralisation of school teachers is the feeling that a great deal of the work that they would otherwise do is being taken over by the training scheme? Will he give me an assurance that he will look carefully

    177
    at closer liaison between schools and school teachers and people doing a similar job under a different budget with a different title in the youth training scheme?
    Mr. Trippier: I can give my hon. Friend the assurance that he seeks in the second part of his question, but I am not sure that I agree with the first part. This is Industry Year, and it gives us a golden opportunity to improve links between industry and education, which perhaps should have been improved 30 years ago. As a result of the initiatives taken by the Department of Trade and Industry and followed by the Department in which I am a Minister I hope that the situation will improve. I do not accept that YTS courses are in any way displacing the work that should be carried out by the teaching profession.
    Mr. Foot: Is it the case that part of the burden of the youth training scheme is being transferred to local authorities? Will the hon. Gentleman tell us exactly what the figure is? Does he realise that that is most unfair, because the heaviest burden falls on some of the local authorities that have the highest unemployment? Will he look at the whole of this proposition to make sure that the full burden of the funding is carried by central Government?
    Mr. Trippier: The right hon. Gentleman is somewhat misled. The change of emphasis in YTS is to place more of a responsibility on employers rather than on local authorities. The principal reason for doing that is that they have a vested interest in the trainees who come out at the other end of the scheme. While I am on my feet, I can hardly miss the opportunity to refer to the fact that the right hon. Gentleman's constituency has seen a fairly dramatic fall in the level of unemployment over the last 12 months—8 per cent.
    Dr. Mawhinney: Can my hon. Friend confirm that that part of the funding that goes to the young people is a training allowance and not a wage? Can he tell the House what he is doing to help the young people themselves understand that in the face of misleading propaganda, some of it coming from the Opposition Benches?
    Mr. Trippier: I am grateful to my hon. Friend for raising that point. It is, of course, an allowance and is not meant to be a wage. We are trying to increase awareness of that fact wherever we can, through publications and the production of videos. I am grateful to my hon. Friend for giving me an opportunity to say from this Box that that is correct.
    Mr. Meadowcroft: Does the Minister recognise the excellent contribution made to the youth training scheme by voluntary bodies? Is he aware that the rules and the way that they are applied, particularly to the number of premium places mentioned earlier, are likely to mean that there will be no B1 schemes run by small voluntary bodies, and that those in Yorkshire with which that I am acquainted are already talking of closing? Will the Minister consider again the whole question of how the rules apply to smaller voluntary bodies which have been able to provide a variety of schemes, which the larger ones cannot provide?
    Mr. Trippier: I give the hon. Gentleman an assurance that I shall consider the matter again. I cannot believe that there will be no premium places available in any part of his constituency with any voluntary training association that has been set up. It is important for me to stress that
    178
    some £40 million was spent last year on unfilled places. As guardians of the taxpayers' money, we cannot consider that as responsible expenditure.

    Health and Safety
    Mr. Prescottasked the Paymaster General how many fatal accidents and serious injuries were reported by the Health and Safety Executive for the last year for which figures are available; and what were the comparable figures for the year ended 1978.
    Mr. Kenneth Clarke: In 1984, 432 fatal injuries to employees were reported; 499 were reported in 1978 under the legislation then in force, which did not cover all sectors of employment. In 1984, 12,246 major injuries to employees were reported. Comparable figures for 1978 are not available. I should point out that the 1984 figures are provisional.
    Mr. Prescott: Does the Paymaster General accept that the great improvement in safety in industry is due largely to the inspectors in the health and safety operations since the Health and Safety Executive was set up? In those industries not covered by the Health and Safety Executive accidents and injuries have increased. Does the Paymaster General accept, therefore, that a reduction of 200 in the number of safety inspectors as a result of cuts in the Civil Service can only lead to an increase in accidents and deaths in industry?
    Mr. Clarke: Our better record is a result of ever-improving consciousness of the need to achieve good practice by employers and employees and of the good work of the inspectors of the Health and Safety Executive? The number of inspectors is down at the moment because of wastage and a large number of retirements. Recruitment of inspectors is taking place in all relevant areas.

    Labour Statistics
    Mr. Dormandasked the Paymaster General what is the total number of unemployed; and how many have been unemployed for at least one and two years respectively, at the latest available date.
    Mr. Kenneth Clarke: On 10 October 1985, the latest date for which figures are available, the number of unemployed claimants in the United Kingdom was 3,276,900, of whom 1,351,900–41 per cent. of the total—had been unemployed for over one year, and 823,100 for over two years.
    Mr. Dormand: Is not the most damning condemnation of the Government's policies the number of long-term unemployed? The figures that the Minister has just read out are disgraceful. As we have constantly been told about the success of the Government's economic policies, will he say when they are likely to bring down the number of unemployed?
    Mr. Clarke: New policies are producing a rapid rate of creation of new jobs. I agree with the hon. Gentleman that our first priority among the unemployed must be to tackle the problem of the long-term unemployed. That is why we are trying out in pilot areas the schemes that I described a few moments ago. We are approaching each of the long-term unemployed in those areas, we are offering them individual advice, referring them to jobs, to training and to job clubs, and providing a new allowance

    179
    to supplement the pay of those who have to take a low-paid job as their first job. The combination of the present growth in the economy and the growth in new jobs, plus those special measures for the long-term unemployed, should bring great hope to many of them.
    Mr. Alexander: When my right hon. and learned Friend announces the monthly unemployment figures, will he consider announcing at the same time equivalent figures for our partners in the EEC? As our figures are usually better than those of other EEC countries, why do we leave it to the Opposition to put the worst possible slant on what we are doing?
    Mr. Clarke: We try to make useful comparisons of that type, but people always take more notice of the unemployment figures than of many relevant comparisons that could be made with overseas. Since the last election here, the creation of new jobs in the United Kingdom has far exceeded the rate at which they have been created in the rest of the EC put together. We should be more aware of that achievement.

  PRIME MINISTER

    Engagements
    Mr. Butterfillasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I had meetings with ministerial colleagues and others. In addition to my duties in this House I shall be having further meetings later today.
    Mr. Butterfill: Is my right hon. Friend aware of the pleasure that will exist in many parts of the House over they fact that, for the first time in seven years, a Prime Minister of Israel is visiting a British Prime Minister? Will she use this opportunity to discuss with him ways in which our two democratic countries can improve their co-operation to combat the scourge of international terrorism?
    The Prime Minister: I agree with my hon. Friend. We are very much looking forward to the visit of Prime Minister Peres. Terrorism will of course be one of the subjects that we shall discuss, but my hon. Friend would not expect me to go into details. I stress that we attach great importance to this meeting.
    Mr. Kinnock: May I first associate myself closely with the Prime Minister's latter remarks?
    Will the right hon. Lady give an assurance that she will do everything in her power to prevent a rise in interest rates, in view of the additional burden that that would impose on British industries doing their best to compete?
    The Prime Minister: Obviously the Government do not like increases in interest rates, but they are bound to take action to ensure that keeping down inflation remains our top priority. Markets this week have been unsettled by the fall in the oil price, but the Bank of England has maintained its dealing rates.
    Mr. Kinnock: Is it not the case that the Prime Minister must be the only person left who believes that she can fight inflation by pushing up interest rates and by imposing on industry the nutcracker of high domestic interest rates and a high exchange rate? What has the Prime Minister got against British industry?
    The Prime Minister: British industry has had an extremely good year, with record profits, record investment and excellent exports.
    Mr. Kinnock: The Prime Minister keeps making misleading claims. Investment in manufacturing industry in Britain is 18 per cent. lower than it was six years ago. Although manufactured exports have increased by 13 per cent. during the past six years, manufactured imports have increased by 45 per cent. I ask the Prime Minister again, what has she got against British industry?
    The Prime Minister: The right hon. Gentleman ran away from many industrial problems, such as restrictive practices and the behaviour of trade unions during the winter of discontent. Yesterday's figures show that industrial production in the third quarter was 2 per cent. up on the second quarter and that manufacturing output was 1 per cent. up. Gross domestic product is at an all-time record.
    Sir Peter Tapsell: Does my right hon. Friend think that it is right or sensible that men and women running small businesses should have to pay about 16 per cent. to borrow money when there are over 3 million unemployed and enormous unused resources? Will she bear this in mind as the clamour rises for even higher interest rates?
    The Prime Minister: It is hardly clamour for higher interest rates. As my hon. Friend has occasion to know, the interest rates are to a considerable extent partly due to the commercial judgment of the banks in the City, and he knows that we cannot disregard that.
    Mr. Steel: Since the Prime Minister recognises the unacceptability of the domestic rating system and is so strongly pledged personally to abolish it, why is it that in the meantime she loads extra expenditure on to the brokendown system, and particularly on to the ratepayers in the counties?
    The Prime Minister: The right hon. Gentleman will have been in for, or will have read, a considerable part of the debate yesterday. He knows full well that the rate support grant settlement for next year involves a modest shift in grant from the shire areas to London and other metropolitan areas, which, unfortunately, does cause discomfort to the shire counties. He knows also that I am no advocate of the present system, and that is why we shall be putting forward proposals, I hope by the end of the month, in a Green Paper to change it.
    Mr. Forsythasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Forsyth: Will my right hon. Friend take the opportunity today to pay tribute to the skills and courage shown by the master and crew of Britannia in rescuing our citizens from the fighting in South Yemen?
    The Prime Minister: I gladly do so. My right hon. and learned Friend the Foreign Secretary will be making a statement after questions, but I am sure that the whole House would like to congratulate the officers and the men of Britannia and of HMS Jupiter and HMS Newcastle and the Royal Fleet Auxiliary Brambleleaf, and the crisis unit at the Foreign Office, which did such excellent work in identifying the people who needed to be taken off from Aden.
    Mr. Maddenasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Madden: Can the Prime Minister say when she will honour her promise to give Government money to Bradford City football club to help rebuild its ground at Valley parade?
    The Prime Minister: I do not think that I made a promise to do that. As the hon. Member will be aware, we are at present considering whether we should give money to Bradford football club. In the exceptional circumstances—[Interruption.] I hear various things coming from hon. Members in a sedentary position. We made a contribution to the disaster fund, and quite rightly. We are considering the question raised by the hon. Gentleman.
    Sir Peter Blaker: Has my right hon. Friend had her attention drawn to the article in the magazine Jane's Defence Weekly, stating that Soviet trained agents have been infiltrating the ranks of the Greenham Common women and that they have been trained to carry out acts of sabotage in time of tension and war? Does my right hon. Friend have any information to contradict that report?
    The Prime Minister: As my right hon. Friend is aware, we do not comment on specific reports, but we are very much aware of the dangers that special forces in the country would present at times of crisis or in wartime. That was precisely why we had Exercise Brave Defender last September, in order to see how we should properly protect sensitive installations.
    Mr. Evans: Has the Prime Minister had the opportunity to read today's London Standard, which carries a front page story stating that the Government are planning new curbs on unions and further anti-trade union legislation? Will the Prime Minister take this opportunity to deny that outrageous story, which will cause anger and dismay among trade union members who have just carried out highly successful ballots to maintain trade union political funds?
    The Prime Minister: I saw the article and anticipated the question. May I make it quite clear that this Government have done more than any other to ensure that union bosses are accountable to their members. There are further steps that can be taken. We have not yet reached any decisions and, before doing so, will be consulting further.
    Sir Anthony Grant: To revert to the question raised by my right hon. Friend the Member for Blackpool, South (Sir P. Blaker), does my right hon. Friend not think that it would be extraordinarily incompetent of the Soviet Union if it did not seek to infiltrate Greenham Common? Can she confirm that top priority will be given to the security, not only of Greenham Common, but of the Molesworth base in Cambridgeshire?
    The Prime Minister: I know of my hon. Friend's particular interest in that base. Brave Defender was carried out to see how we could ensure the defence of all-important installations, including that one.
    Mr. Kilroy-Silkasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Kilroy-Silk: What would the right hon. Lady say today to those unemployed young people from my constituency who visited her last year and who are still unemployed, to the 10,000 unemployed in my constituency and to the tens of thousands who will lose jobs throughout the country as a result of the massive rises in rates and interest rates that are in the pipeline?
    The Prime Minister: The hon. Gentleman refers to the group that he brought to see me a year ago. I had several employers there to see the group. I made inquiries before I came to the House today and I was told that all but four of the group have been offered either training or employment.
    Mr. Foxasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Fox: Will my right hon. Friend assure us that once the law to allow Sunday trading comes into operation she will give some support to flexible licensing hours, and thus bring the country into line with Scotland and the Palace of Westminster?
    The Prime Minister: As my hon. Friend is aware, the Shops Bill has yet to come to the House and proceed through its stages. I am aware that a number of people would like to consider flexible licensing hours, and if my hon. Friend wishes we shall give consideration to that in due course. However, one should not do anything to suggest that flexible licensing hours are equal to or in any way the same as those of the Palace of Westminster.
    Mr. Donald Stewart: Does the right hon. Lady intend to ignore the vast correspondence that she has received protesting against the Shops Bill? Will she at least refrain from putting a three-line Whip on what is a matter of conscience?
    The Prime Minister: I understand that the right hon. Gentleman comes from a part of the country where there is no limitation on Sunday trading. However, he wishes to stop us south of the border from having the same privilege. As he knows, we do not discuss Whipping matters in the House.
    Mr. O'Brienasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. O'Brien: Is the Prime Minister aware of the serious unrest among members of the Royal College of Nursing following the appointment of district managers from outside the service, and of the effect that that is having on the morale of nurses? Will the Prime Minister prevail upon her colleague the Secretary of State for Social Services, with a view to him examining this serious problem so that he can appoint nurse-managers from within the service, to whom nurses would be responsible and by whom they would be managed, to ensure proper patient care?
    The Prime Minister: I visited a hospital on Friday, and I did not find what the hon. Gentleman is suggesting. Most people in the National Health Service realise that it is important to get good management. Managers are

    183
    sometimes nurses or doctors, but it is important that the right person to be a manager is chosen, whether that person has previously been an administrator, a nurse or a doctor.
    Mrs. McCurleyasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister: I refer my hon Friend to the reply that I gave some moments ago.
    Mrs. McCurley: Will my right hon. Friend consider using her personal influence to urge the Scottish striking teachers to negotiate an end to this damaging strike, which is hurting pupils and lowering the profession in the esteem of the public?
    The Prime Minister: I agree very much with my hon. Friend. We deplore the further industrial action because of the harm that it is doing to pupils and the great distress that is is causing the parents. I join her in hoping that the strike will soon end, and that we shall be able to come to some agreement on terms and conditions of service also and that we will be able to get a better system of appraisal so that we can pay better teachers more.
    Mr. Loyden: Can the Prime Minister say what benefits will accrue to the northern regions of this country, and to Scotland and Northern Ireland, arising out of the
    184
    agreement that she signed yesterday with the French President, particularly regarding the regeneration of industry and jobs?
    The Prime Minister: That would depend upon how many of the orders for equipment and materials went to Scotland, but about 50,000 man-years' work will be involved in that project and I hope that that will spread very well over the country.
    Mr. George Gardinerasked the Prime Minister if she will list her official engagements for Tuesday 21 January.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Gardiner: After giving such a commendable impetus to plans for a tunnel under the English Channel, may I ask my right hon. Friend to instil the same sense of urgency into the Department of Transport regarding a far more modest project for a tunnel under the River Thames at Dartford — thereby removing the most atrocious bottleneck on the M25 —especially since private risk capital is available for this venture too?
    The Prime Minister: I very much take note of what my hon. Friend says. I have occasion to know that area very well. I particularly note that he believes that private sector capital would be available for such a project.

Yemen
3.32 pm
The Secretary of State for Foreign and Commonwealth Affairs (Sir Geoffrey Howe): With permission, Mr. Speaker, I would like to make a statement on the action being taken to secure the safety of British subjects and others in the People's Democratic Republic of Yemen.
On 13 January fighting broke out in Aden. The ferocity of the fighting presented grave risks to the safety of British subjects. In those circumstances, and with the full agreement of Her Majesty the Queen, the royal yacht Britannia, which was just leaving the Red sea, was ordered to remain off Aden, and Her Majesty's ships Newcastle and Jupiter, with the Royal Fleet Auxiliary Brambleleaf, were ordered to Aden at full steam in case they were needed for an evacuation.
The situation in the country continued to deteriorate and the level of fighting approached that of a civil war. After close consultation with the Russians and French, both in Aden and in capitals, it was agreed that evacuation was necessary and that, as far as possible, our efforts should be co-ordinated. On 17 January, Soviet merchant vessels lifted off from Aden about 1,000 people, mostly their own nationals. On the same day, the royal yacht took off 450 people, 38 of them British—44 nationalities altogether. Eighty-one French nationals were then transferred to a French ship, and the rest of the evacuees were taken on Britannia to Djibouti. The royal yacht then returned to the area and on 19 January lifted off a further 209 people from an area 35 miles from the capital. Eighteen of these were British. These have since arrived in Djibouti, 'after transferring to HMS Jupiter. I am now very pleased to be able to add that Britannia has this morning picked up a further 15 British nationals from Little Aden. Britannia is maintaining close contact with the vessels of the other nations involved, and remains offshore nearby to take on board further parties of British and other foreign nationals as soon as conditions permit.
So far, no British subjects have been hurt. However, a number of British subjects still remain in south Yemen and we are continuing to work out with other Governments the best ways of evacuating these widely scattered communities.
On the evening of 17 January, when the embassy and residence had been rendered unihabitable, the ambassador, Mr. Arthur Marshall, decided that he should withdraw all members of the embassy. At the end of the evacuation, he accompanied those on board to Djibouti but then returned on Britannia to the area, where he will remain with a member of his staff while the evacuation continues. Another member of his staff is on board HMS Newcastle.
The success of the evacuation so far would not have been possible without the help given by a number of Governments, and in particular the Governments of Djibouti, the USSR and France. This has been a remarkable demonstration of what can be achieved through close international co-operation, and I take this opportunity to thank them warmly for their assistance.
I should like to express my gratitude to all the staff of the Ministry of Defence and of the Diplomatic Service, at home and abroad, who have been involved in this operation. I should particularly like to thank our honorary
186
consul in Djibouti, Mr. Christopher Reddington. I know too that the whole House will join me in praising the calmness and efficiency of our ambassador in Aden, his staff, and their families throughout this difficult period.
Their example has been matched by the fortitude of the British evacuees, who helped to organise the evacuation of hundreds of other nationals and who set an example of disciplined behaviour throughout.
This is the first time that the royal yacht has been involved in a operation of this sort. It has received magnificent support from HM ships Newcastle and Jupiter, and Royal Fleet Auxiliary Brambleleaf, with its Merchant Navy crew. I should like to pay tribute to Rear-Admiral John Garnier and all the officers and crew involved for the courage and professionalism that they have shown in carrying out the operation in conditions of danger and difficulty. We can all be proud of them.
Mr. Donald Anderson: We and the British people as a whole can be proud of this magnificent rescue. We rejoice that no British subjects have been injured or killed in spite of the ferocity of the fighting, and we join wholeheartedly with the Foreign Secretary in thanking and paying tribute to those of our people—the military, Admiral Garnier, the diplomatic staff, Mr. Marshall and those with him — who played and are playing such a wonderful part to ensure a successful outcome.
The Foreign Secretary must be aware that the rescue amounts to probably the highest point of British-Soviet co-operation in a practical sphere since the end of the second world war. We hope that the spirit of good will will act as a precedent and will spill over into other fields of our bilateral relationships with the Soviet Union. However, the Soviet Union has learnt the cost, as have other peoples, including ourselves, the Israelis and the Americans, of unilateral intervention in a middle east country.
I ask the Foreign Secretary, to report to the House in specific respects. Was the matter of the rescue raised in his discussions yesterday with Mr. Ryzhov, the Soviet Deputy Minister? On the best estimates available to him, how many Britons remain in South Yemen? Can he say how long it is expected that the royal yacht Britannia will remain close by and available for action? What is the Foreign Office reading of the position regarding who is in charge in South Yemen? Is it the Foreign Office view that the difference between the factions there is essentially on ideological lines, or is it more based on personal and tribal factors?
Finally, are there any anxieties about the troubles in South Yemen spilling over into neighbouring territories, and possibly posing a threat to security in the region as a whole?
Sir Geoffrey Howe: I thank the hon. Gentleman for the kind way in which he has joined me in paying tribute to all those involved in the operation, and add my word of thanks to my hon. Friend the Minister of State for the Armed Forces for his support throughout.
The hon. Gentleman is right to draw attention to the degree of co-operation between the United Kingdom and the Soviet Union on this occasion. One cannot presume from that high degree of co-operation that everything else will be handled in the same spirit, but I hope that it will not be the last occasion for improving relationships in this way. I was able to raise the matter with Mr. Ryzhov last

187
night, to thank him for the co-operation that had taken place, and to express the hope that it would continue in practical terms on the spot. It is worth reminding the House of what Admiral Garnier said this morning when he paid tribute to the fine atmosphere of international co-operation. He said that
"the French, the Soviets and us are talking regularly, pooling our information, and everyone here is dedicated to the hope that we can get the remaining people off."
The hon. Gentleman asked precisely the questions which one would want to ask. It is not possible to be sure about the number of British subjects still left in the PDRY, but our inquiries suggest that the figure is likely to be about 40. Her Majesty has expressed her willingness for Britannia to remain for as long as there is a need for it to do so.
It is not possible for me to offer any clear view on the outcome, because the situation is still very confusing, but it appears that the conflict arises from differences of a tribal kind rather than a political or ideological kind. So far, the problems have not spilt over into other neighbouring countries. If they did, it would naturally be a cause for concern. We are keepng in close touch with all those countries in the neighbourhood.
Sir Antony Buck: Does my right hon. and learned Friend agree that it is refreshing to find the whole House able to unite in congratulating all those involved in this splendid operation? Does he agree that it has proved the utility of the royal yacht not only as a hospital ship on this occasion but as a facility which is extremely useful for us to have? It has proved itself in many other ways not only from an ideological point of view but as a fitting facility for the head of a great Commonwealth country?
Sir Geoffrey Howe: I agree with my hon. and learned, Friend's first comments and with his tribute to the value of the royal yacht, with its particular suitability for an occasion of this kind and its value in a much wider representational capacity.
Dr. David Owen: I congratulate all those concerned, particularly the Soviet and French Governments. Does the Foreign Secretary agree that this shows the value of being able to deploy the Royal Navy east of Suez? In view of the announcement of the 7 per cent. real terms cut in the defence budget, will the right hon. and learned Gentleman use his influence to ensure that the Royal Navy surface ships are not cut back and that their present minimal numbers are fully maintained?
Sir Geoffrey Howe: I can well understand the right hon. Gentleman's interest in this aspect. It illustrates the value of having this kind of capability available in so far as it is compatible with the continuing and difficult task of judging the pattern of priorities on defence expenditure more generally.
Dr. John G. Blackburn: Will my right hon. and learned Friend take note of early-day motions 322 and 323 which refer to Britannia? Will he send a signal to the admiral conveying the sentiments expressed in those early-day motions and pay a warm and generous tribute to the skipper and crew of the Diamond Princess, a British registered cargo ship which is reported to have saved some 600 people in the past 24 hours?
Sir Geoffrey Howe: I shall certainly be willing to pay tribute to any vessels or individuals for the part that they have played, once that is established. I certainly join in the sentiments to which my hon. Friend has drawn attention in early-day motions 322 and 323. They pay a deserved tribute to those concerned in this rescue. I shall see that that tribute and my hon. Friend's sentiments are conveyed to the rear admiral and those with him.
Mr. David Winnick: I, too, associate myself with the splendid work that has been undertaken. Does the right hon. and learned Gentleman agree that the faction fighting in Yemen is a sharp warning to the Cabinet not to allow their disagreements to get out of hand?
Sir Geoffrey Howe: The hon. Gentleman can always be relied upon to make an inaccurate observation on almost any occasion.
Mr. John Stokes: Is my right hon. and learned Friend aware that the whole nation looks with great pride and gratitude on the achievements of the Royal Navy during the past few days? It notes once again the usefulness of the royal yacht, with its supporting small ships. It should be grateful to my right hon. and learned Friend the Foreign Secretary for the way in which he masterminded the whole business.
Sir Geoffrey Howe: I am even more than usually grateful to my hon. Friend for the generosity of his tribute. The actions and decisions of those on the spot deserve particular thanks on this occasion.
Mr. Dennis Skinner: Is the right hon. and learned Gentleman aware that, as the rescue appears to have been a huge success, some of us are a bit curious about why the Prime Minister has not taken full advantage of it? Have arrangements been made to get her out there on the deck of Britannia with the television cameras? Perhaps the right hon. Lady could be seen shaking hands with the Soviets—perhaps a member of the KGB or even one of those who associate with the same group that has figured prominently in Jane's Defence Weekly? What a wonderful picture would be painted!
Sir Geoffrey Howe: Only the hon. Gentleman would have used this occasion to illustrate his capacity to play the game of consequences in a profoundly inconsequential fashion.
Mr. A. J. Beith: Some of the preceding comments look a little odd beside the enormous relief felt by those who experienced the rescue in extremely dangerous circumstances. Was not great courage shown by those in the Diplomatic Service who assisted in getting the evacuees to the beaches and by those in the small boats who came from Britannia to take them off the beaches? Did not the BBC overseas service also play an important and necessary part in the rescue?
Sir Geoffrey Howe: I am grateful to the hon. Gentleman for returning our discussion to the proper note of seriousness and thankfulness. He was right to pay tribute to all those concerned and to the BBC world service, which has played an important communication role on this and other occasions.
Mr. Harry Greenway: Does my right hon. and learned Friend agree that Britannia's versatility on this occasion is impressive and welcome to a wide section of our community, which wants Britannia to play

189
a wider role when the Queen does not require her? Does my right hon. and learned Friend have other roles in mind for HMS Britannia?
Sir Geoffrey Howe: It would not be for me to specify other roles. I certainly endorse my hon. Friend's comments. Britannia is particularly suitable for this type of role, because she is a non-combatant vessel designed to handle a large number of people and well equipped with the necessary boats.
Mr. Andrew Faulds: May I add my congratulations on the successful operation in evacuating so many people from this unhappy territory? Has the right hon. and learned Gentleman's desk yet had a chance to analyse the likelihood of whether the Administration likely to take over in PDRY will continue to welcome the opening to the West that the previous Administration were adopting?
Sir Geoffrey Howe: I think that it is too early to speculate on the nature of the Administration that may take over or on any difference in its direction. As I said, the dispute appears to arise more from personal and tribal conflicts of a traditional kind than from ideological variations.
Mr. Peter Bruinvels: Will my right hon. and learned Friend join me in congratulating the state of Djibouti on the speedy help it has rendered not only to the royal yacht Britannia but to the other ships that came in to take off so many people? Will he congratulate those people in the Foreign and Commonwealth Office who so speedily commandeered the royal yacht? Will he expand on the relationship with the Soviet Union in this case, because obviously the co-operation was unusual?
Sir Geoffrey Howe: I do not think that my hon. Friend has exactly the right insight into the relationships between the Foreign Office and the royal yacht. I join with my hon. Friend in paying tribute to the Djibouti Government for their particularly helpful attitude in receiving and handling thousands of evacuees and assisting in their repatriation. We are particularly grateful to President Hassan Goulad Aptidon for his help. Contact on this matter has taken place sensibly and practically between the embassies on the spot and between Foreign Ministries at this end directed from Moscow and Paris. This is how one would have expected the operation to proceed. One hopes that it will afford an insight into the way in which matters will develop in other respects.
Mr. John Wilkinson: We are all rightly proud of the courage and efficiency of those involved in the evacuation. Is not the Soviet Union likely to benefit from what has transpired because Mr. Ismail was allowed to return to Yemen as a conscious policy act on its part? Although there may be some short-term turbulence, perhaps even bloody turbulence, the Soviet Union's influence in that part of the world could be enhanced rather than diminished.
Sir Geoffrey Howe: My hon. Friend's speculation may well be right. However, it would take a relatively optimistic Soviet adviser to perceive any clearly cheerful conclusion from the circumstances in which hundreds of Soviet citizens have been evacuated.

Stanley Royd Hospital
3.50 pm
The Secretary of State for Social Services (Mr. Norman Fowler): With permission, Mr. Speaker, I should like to make a statement on the Stanley Royd hospital inquiry report. I am this afternoon publishing the report of the committee of inquiry into the outbreak of food poisoning at Stanley Royd hospital, Wakefield.
Stanley Royd is a large hospital in Wakefield for mentally ill and psychogeriatric patients. In a major outbreak of salmonella food poisoning which began on 26 August 1984, 355 patients and 106 members of staff were affected. Food poisoning caused, or contributed to, the deaths of 19 patients. At the time of the outbreak and subsequently, a number of allegations were made of errors in the control of infection, of poor standards of hygiene in the hospital kitchen and of other shortcomings.
I announced in September 1984 that I was setting up a public inquiry into the outbreak under the chairmanship of Mr. John Hugill QC. The other members of the inquiry were Professor Rosalinde Hurley and Mr. Patrick Salmon. The committee heard oral evidence between February and May 1985. It submitted its report to me last month. I am most grateful to the chairman and members of the committee for all their work on this complex inquiry.
The report gives a detailed account of the background to the outbreak and its course and of the actions taken by National Health Service staff.
The committee concludes that the cause of the outbreak was salmonella which was probably brought into the kitchen in contaminated chickens, and that cold roast beef was the most likely vehicle of infection. The infection was able to multiply because the beef was not properly refrigerated. The committee found that a number of unhygienic and unsatisfactory practices had grown up in the hospital kitchen.
The report pays tribute to the work of the junior doctors on duty during the early days of the outbreak and the care given by nursing staff on the wards. Those staff were working under very difficult conditions and their efforts were in the highest traditions of their professions.
The committee makes criticisms on a number of matters. In particular, it comments on the failure to ensure satisfactory management of the kitchen at the hospital. It criticises medical and nursing management and in particular the failure to seek, or accept offers of, help from outside specialists, both in the investigation of the outbreak and in the treatment of the patients affected by it. The regional health authority and some officers at regional and district level are criticised for failing fully to inform themselves first-hand of the situation once the outbreak had occurred.
Since the outbreak, Wakefield health authority has made a number of improvements in the kitchen and its management. I am now instructing it and the Yorkshire regional health authority to consider all the points raised by the report and to report to me urgently on the action they have taken and propose to take in response to them. That response must cover the position of those people whose conduct may have contributed to these tragic events, and the steps taken to ensure that such events do not recur.
The report identifies serious failures of supervision and management. General managers have now been appointed by the Yorkshire regional health authority and Wakefield

191
health authority. As in all authorities, these managers carry clear and personal responsibility for securing effective action.
A number of comments were made on the position at Stanley Royd prior to and during the inquiry. One of these concerned finance. On this the report says that it was not its
"view that the question of financial restraints or constraints above the level of the region were relevant to any of the issues which we had to consider and, in taking this view, we are supported by the evidence given by witnesses from the Yorkshire regional health authority".
Another suggestion was that Crown premises like hospitals should be subject to the general food legislation. However, the report states that in the case of Stanley Royd the evidence did not support the need for the abolition of Crown immunity. The report says:
"We find it impossible to recommend any change in the law on the vexed question of Crown immunity where the entirety of the evidence given to us by the professional environmental health officers was to the effect that the sanctions of the criminal law would not have been employed in respect of the kitchen at Stanley Royd, even if they had been available."
The Government will nevertheless continue the urgent review of Crown immunity for hospital kitchens, including the suggestion in the report that a "Crown notice" form of procedure should be initiated.
The majority of the report's formal recommendations are aimed at improving standards of hygiene in hospital kitchens and improving the investigation and control of any future outbreaks. The committee recognises that the departmental guidance on food hygiene in hospitals is basically sound and recommends that health authorities should be reminded of its terms. We had already done that before the report was received.
In addition, I am urgently reviewing departmental guidance to health authorities on the steps that they must take to ensure proper food hygiene in hospitals and to ensure that environmental health officers are encouraged to visit, and that proper regard is paid to their recommendations. In doing so, I shall take full account of the Stanley Royd committee's recommendations.
I am referring the recommendations about the arrangements for the control of infection and the handling of outbreaks to the hospital infection working group. This group was set up last summer to advise me on the revision of departmental guidance on control of infection and I am asking it to give me the highest priority on contingency plans for dealing with outbreaks of infection—plans that will ensure that specialist help is brought in as soon as it is needed.
There can be no doubt at all about the continuing need for proper provision of public health and community medicine advice within the management structure of the Health Service. The functions of the specialty of community medicine include not only the control of infectious diseases but the assessment of the needs of populations for health care, the planning and evaluation of health services and responsibility for prevention and health promotion.
I have therefore decided that it would be right to establish an inquiry into the future development of the public health function, including the control of communicable diseases, and the specialty of community medicine in England. The inquiry will be a broad and fundamental examination of the role of public health doctors, including how such a role could best be fulfilled. The inquiry will be chaired by the Government's Chief
192
Medical Officer, Dr. Donald Acheson, and I expect to receive its report before the end of the year. Details of membership will be finalised shortly. In the meantime, we shall take every step possible to prevent a recurrence of these tragic events.
Mr. Michael Meacher: Is the Secretary of State aware that this tragedy represents the culmination of a damning catalogue of manifest negligence in this case, and brings to a head the scandal of appalling insanitary and even lethal conditions in so many hospital kitchens throughout the country?
On this specific episode, will he confirm that the magnitude of the outbreak—27 deaths in all and two nurses on the critical list—was due to four serious failings that should never have happened? Does he agree that when the duty doctor advised the use of barrier precautions there was, astonishingly, no barrier equipment available to the staff? There were no gowns, masks. gloves or shoes for the purpose.
Will the Secretary of State confirm also that when staff asked that the nearby Snapethorpe hospital—an old isolation hospital which had been closed during the cuts—should be used to isolate infected patients, especially the elderly and frail, management rejected the request, and, as a result, only three of the 32 wards escaped infection? Does the right hon. Gentleman agree that in such a situation the normal instruction is that staff should return to work only after three consecutive negative tests? At Stanley Royd, however, because of staff shortages, which the reports fully recognise, the staff were told to return to work before they were over the illness and, in some cases, while they were still giving positive tests.
Will the Secretary of State also confirm that the health authority sought to minimise the situation at the time to the extent of restarting admissions halfway through the outbreak, although on the first night of readmissions three more patients died and admissions had to be stopped again? What specific action is the Secretary of State taking to prevent each of those four causes of disaster from recurring at Stanley Royd or elsewhere?
The Secretary of State said complacently that, since the outbreak, Wakefield health authority had made a number of improvements in the kitchens and in management. Is that not a wholly inadequate whitewash when previous salmonella outbreaks had occurred at Stanley Royd in 1974 and 1979, when a district medical officer had described the kitchens as "a culinary disaster area" seven years before the tragedy, when plans to upgrade the kitchens had been continuously postponed since 19'78 and when help specifically offered to the hospital by the communicable diseases surveillance centre had been categorically turned down?
Is the Secretary of State further aware that this episode, while particularly tragic, is far from unique? There are now about 40 outbreaks of food poisoning in hospitals every year and hospitals are now the third highest source of food poisoning in the country. Is the Secretary of State aware that illness from bacterial food poisoning in hospitals has increased fourfold since 1981 to more than 1,000 cases per year and that deaths from that cause have risen over the same period to more than 50 per year?
Is the right hon. Gentleman aware that the latest reports—a year ago—of the Institution of Environmental Health Officers revealed that 60 per cent. of hospital kitchens currently breach food hygiene regulations and

193
that 97 hospitals would be prosecuted were it not for Crown immunity? As the Department of Health and Social Security has the list, will the Secretary of State publish the names of the 97 hospitals, because the public are entitled to know? Will he accept that, where repeated surveys of hospital kitchens have found vermin infestation, open gutters, foul smelling grids, bird droppings and insecticide spraying during food preparation, the only effective way to protect patients, visitors and hospital workers is to abolish Crown immunity?
Is it not a medieval anachronism that a café with cockroaches is prosecuted but a hospital escapes, although frail, elderly patients are particularly vulnerable to lethal food poisoning? If 27 people can die in a hospital which the report claims would not be prosecuted, how many deaths are we risking in the 97 hospitals that would be prosecuted tomorrow if the Secretary of State fulfilled his responsibility to the nation by lifting the unjustified and unjustifiable immunity?
Mr. Fowler: There is absolutely no question of complacency on the Government's part. Neither is there any question, as anyone who has read the report would know, of any attempt to whitewash the seriousness of the outbreak. What the House should concern itself with—I recognise that the hon. Member for Oldham, West (Mr. Meacher) was seeking at least in part to do this—is to decide what action should be taken to prevent such tragedies from occurring again.
The causes of the outbreak are set out very succinctly on page 106 of the report. It states that the main problems were human errors compounded by failures of supervision and management. The report makes clear that all the rules and principles of good catering practice were known and the outbreak occurred because the rules were ignored. The failure to follow the rules arose partly through the failure of supervisory grades to supervise, and that failure stemmed from the failure of the management to manage and check. The hon. Gentleman will know, having read the report, that it sets out a number of illustrations and examples of where the management process had fallen down. At that stage, of course, general managers had not been appointed in the health authorities in question. That improvement has since taken place.
The hon. Gentleman asks what action will follow from the report. The people who are criticised in the report and the chairmen of the authorities have seen the report for the first time today. I shall be inviting the chairmen of the authorities to meet me this week and I shall discuss with them the action that must be taken. That talk will also cover individual responsibilities. As the hon. Gentleman will know, disciplinary action is a matter for the authority, and it would be wrong for me to comment on that as I have an appellate function in that respect.
The question of barrier nursing is dealt with in paragraph 76. The report sets out the grave difficulties that exist in a hospital of this kind and paragraph 76 ends by stating that:
"To speak of barrier nursing against such a background is absurd."
Further study of the report will provide an answer to the hon. Gentleman.
The report states quite clearly that finance was available both to improve the kitchens and to replace them by
194
building new kitchens. That is now being done. It was a complete failure on management's part that that was not done before. I accept that that is the case. One of the reasons was that no one was ultimately responsible for the decision not being taken.
I accept the comments of the hon. Member for Oldham, West and I know the feelings of the Opposition and of many of my hon. Friends on the matter of Crown immunity. There is a serious issue to examine, but it is clearly fair to stress that the report repeats on three occasions that the existence of Crown immunity would have made no difference in the handling of this particular case. The reason for that is that it was not the physical conditions of the kitchen that were at fault but the procedures that were being used. For example, the pan wash was found to be blocked by cutlery. That has nothing to do with the physical conditions, but it has everything to do with the procedures being followed. We shall consider both Crown immunity and the new proposal in the report for Crown notice and we shall report to the House on our consideration of those matters.
Mr. William O'Brien: Will the Secretary of State join me in congratulating the staff of Stanley Royd hospital, which is in my constituency? I know the results of the work that the staff had to undertake, some times beyond their usual call of duty, in an attempt to combat the problem. The House ought to record its appreciation for the staff who worked under those conditions.
I hope that the Secretary of State will refer to another cause for concern—the delay in the presentation of the report. A number of people who live in the area and work in the hospital repeatedly asked me when the report would be published. There is genuine criticism about the length of time that the report took to be presented.
The Secretary of State referred to the regional health authority's role and I hope that he will take cognisance of that. Paragraph 180 refers to the kitchen and paragraph 190 refers to the under-staffing of the kitchen. Paragraphs 251 and 252 refer to the health authorities' attitudes to the need for a new kitchen or for reorganisation of the kitchen. Paragraph 252 states that the area health authority wished to take over the responsibility for providing a new kitchen but was not permitted to do so by the regional health authority.
Paragragh 288 states:
"We also find it quite incredible that, apart from expressing regret and sympathy about the outbreak, the Region did not discuss the problem, the causes, or the action being planned or taken, at any meeting thereafter. It was as if it had nothing to do with the RHA. If it had not, then the usefulness and relevance of this body would seem dubious."
In the light of that, will the Secretary of State consider whether it is not time for the regional health authorities to be abolished and for responsibility for running area health authorities to reside at local level?
Mr. Fowler: On the last point, I should not wish to go on record as supporting that, but I share the hon. Gentleman's concern about the statements made in paragraph 288 of the report and the fact that the management, control and effective leadership that the public had a right to expect were not provided at that time. I believe that the solution is to consider the responsibilities of the regional health authority and to make it clear, as we did prior to the report, that we expect the regional health authority not to act in the way described in paragraph 288.

195
On the other points, I gladly repeat what I said in my statement. I believe that the public generally and the whole House wish to pay tribute to the nursing staff, junior doctors and other staff who worked extremely long and hard to ensure that the outbreak was contained.
As for delay, the report was received only last month. It has been printed and the Government clearly wanted to make an initial response, so I do not think that there has been any undue delay in bringing it before the House.
The finance for a new kitchen was available—there is no question about that—but the regional health authority did not process it as it should have been processed. The new kitchen should have been built long ago.
Mr. Teddy Taylor: Despite what my right hon. Friend has correctly said about the availability of capital expenditure, does he agree that paragraph 190 states specifically that the cleaning schedule for the kitchen fell behind due to shortage of staff? Although the report makes it clear that there would not have been prosecution if Crown immunity had not applied, does he agree that that does not affect the principle of the matter? Will he therefore give a clear assurance that he will support the excellent Bill proposed by my hon. Friend the Member for Aldridge-Brownhills (Mr. Shepherd)?
Mr. Fowler: I can certainly give a full assurance that the Government will continue urgently to review the whole issue of Crown immunity and the proposal for Crown notice put forward in the report. I believe that it would be wise for the House to pause and consider the proposal for Crown notice as well as the issue of Crown immunity. Nevertheless, my hon. Friend the Member for Southend, East (Mr. Taylor) and the Government are at one in wishing to have the causes of this type of outbreak contained. The Government are therefore considering the matter urgently and with determination to ensure that no future outbreak takes place. The other part of the report also deserves study as it makes it clear that lack of management and supervision contributed substantially to the outbreak. I accept that a shortage of catering staff is also noted, and that is one of the points that I shall wish to take up in my discussions with the chairmen.
Mr. Jack Ashley: Does the Minister accept that, instead of pausing to consider Crown notice, the House should condemn one of the most disgracefully complacent ministerial statements ever to be made in this Chamber? The Secretary of State is directly responsible for the deaths of those people in Wakefield, and his suave easy-going manner will convince no one to the contrary. In the past six years there have been 211 outbreaks of food poisoning in hospitals, in which 3,969 people have been poisoned by salmonella bacteria and 279 people have died. The Secretary of State cannot dispute that because those are his own figures given in reply to questions from me. The Government are in the dock on this and they are to blame because they have refused to abolish Crown immunity and health authorities hide behind the fact that they cannot be prosecuted. Will the Secretary of State admit that he is responsible and that, regardless of what the report says, the only way to solve the problem is to abolish Crown immunity, prosecute negligent authorities and provide the funds needed to end this scandal once and for all.
Mr. Fowler: First, I regret very much the tone adopted by the right hon. Gentleman, which did not live up to the high standards that we expect of him. The Government are not refusing to abolish Crown immunity, but we believe that it is sensible to have regard to an independently commissioned report. In this case, the report states that the abolition of Crown immunity would not have tackled the fundamental cause. With great respect, the right hon. Gentleman should address his mind to those issues as well.
The Government and the House must consider why the outbreak occurred. The reasons are set out in the report. The main problems were human error compounded by failure of supervision and management. Whatever we do about Crown immunity, we must tackle that problem, otherwise the right hon. Gentleman's words will mean precisely nothing.
Mr. Richard Shepherd: Will my right hon. Friend publish the list of more than 90 hospitals which would be liable to prosecution but for Crown immunity so that the public at large may have at least the protection of that warning as to the kind of institution they will be entering? As environmental health officers have been pressing for 14 years for this specific relief from Crown immunity, could the urgency with which the Government are reviewing this particular area be advanced to the extent of allowing us to know by 7 February where the Government stand?
Mr. Fowler: I cannot promise the latter. However, I do not intend that the review should be an extended one. I shall let the House know of the outcome as soon as I can. I shall provide as much information as we have available to the House and to the public.
Mr. Geoffrey Lofthouse: Does the Secretary of State agree that this devastating report is an absolute disgrace in 1986? I speak with some emotion, because the 19 deaths arising out of the salmonella outbreak at Wakefield included my brother-in-law. I visited the hospital in the early days of the outbreak. I join my hon. Friend the Member for Normanton (Mr. O'Brien) in paying tribute to the hardworking staff who worked, at considerable risk to themselves, to put an end to the unfortunate incident. However, it is no good looking back and having sympathy. Those unfortunate people are gone.
Does the Secretary of State agree that the report clearly shows that there was neglect in some quarters? The report suggests that if Crown immunity had not been operating, that may have made no difference. It would, however, have been an added safeguard. There is no reason why Crown immunity should not be lifted. There should be a statutory obligation by which local health inspectors are allowed into hospitals to carry out additional inspections. If not, why not? If there is nothing to cover up, there is nothing to fear.
Does the Secretary of State agree that the cause of one of the biggest problems, which should be abolished, is that of housing people in Victorian workhouses such as the Stanley Royd hospital. I plead with the Minister not to wait for further inquiries. There is sufficient evidence. He should abolish Crown immunity immediately and allow independent health inspectors into those hospitals so that they can make a further check on the disgraceful conditions that existed in that hospital.
Mr. Fowler: I share the hon. Gentleman's concern about the outbreak. I agree with him that the report tells a story of neglect at several levels. No one who has read the report could be satisfied or happy about the position. However, the hon. Gentleman will accept that it is wise for the Government to consider the report's proposals, even though the proposal on Crown immunity is contrary to what the hon. Gentleman wishes.
Environmental health officers have, and will continue to have, absolute and free access to hospitals. That is essential. It is equally important that the catering procedures and practices are such that, irrespective of the inspectorates, catering establishments and kitchens are run in a proper way. The hon. Gentleman will agree that that is a function of good supervision and good management, all of which broke down in this case.
Mr. Anthony Beaumont-Dark: Does my right hon. Friend accept that it is hysterical nonsense for the right hon. Member for Stoke-on-Trent, South (Mr. Ashley) to suggest that the Government are in the dock, as though they had invented Crown immunity?
Would it not be a great success for the Government to realise that it is nonsense to hide behind Crown immunity, when they should be protecting people? The Government may not be hiding behind it in this case. But is it not proper justice in this modern age that people should be protected, whether it be from the Crown or from villains?
Mr. Fowler: I am grateful for what my hon. Friend has said. We are discussing how that protection should be provided. Apart from the matter of Crown immunity or Crown notice we must tackle the cause of the problem, which, in this case, has been the failure of supervision and management.
Mr. Walter Harrison: In his statement the Secretary of State congratulated the chairman. Will the Secretary of State identify to which chairman he was referring? He can read his statement to see that he has congratulated a chåirman, but there are three chairmen involved—the chairman of the inquiry, the chairman of the health authority and the chairman of the regional health authority. The Secretary of State should identify the chairman who merits congratulations.
The statement uses the words "human error" and "prosecution". The words "lack of occur about five times, but what is never mentioned in all the references to the lack of administration, of supervision and of everything else, is the lack of adequate finance to run a proper Health Service. I refer you to paragraph 266—[HON. MEMBERS: "You?"]
Mr. Speaker: The right hon. Member is being questioned because he is drawing me into this matter. He should address his remarks to the Minister.
Mr. Harrison: I thought that I saw the Minister mumbling and I am rather sensitive about such things. Paragraph 266 of the report states:
"There can be no doubt but that neither the Wakefield Health Authority nor the Regional Health Authority have sufficient funds available to bring everything within their jurisdiction up to the best possible standard immediately."
The Secretary of State and his Department have had reports about inadequacies in the hospital. It was drawn to their attention that funds were required. What happened? The regional health authority and the Wakefield health authority received global sums, but it is like the chap who
198
gambles with the three eggcups and must decide which one hides the money. Priorities have been discussed. The regional health authority chairman got a flap on and turned down the proposals not because of the facilities that were required. I have met four or five Ministers about this. Ministers tried to spread out the money in Wakefield, but it was completely inadequate and hospitals were closed. Snapethorpe could have treated patients with infectious diseases, but it was closed because funds were cut.
Mr. Speaker: I know that the right hon. Gentleman has a deep and personal interest in this matter, which is quite right, but I ask him to put his question.
Mr. Harrison: I thought that I had qualified my question by asking why the Secretary of State had not taken these matters into consideration, Mr. Speaker.
Snapethorpe was closed through lack of funds, and I am still fighting that battle.
Regarding human error, the Secretary of State is responsible. If there is a prosecution, the first person to be prosecuted should be the Secretary of State. The "lack of which is mentioned five times in the report, should refer to lack of funds, funds that his Department has failed to allocate to Wakefield. Since you wish me to wind up, Mr. Speaker, I conclude by saying that the Department should conduct another reappraisal of the moneys that it has allocated to the Yorkshire region so that the problems can be dealt with.
Mr. Fowler: May I answer the right hon. Gentleman's first question, which he asked some time ago. In my statement, I said that the inquiry was chaired by Mr. John Hugill, and that the other members of the inquiry were Professor Rosalinde Hurley and Mr. Patrick Salmon. I said:
"I am most grateful to the chairman and members of the committee for all their work on this complex inquiry."
"I am not sure whether I could have made it much clearer, but I am grateful for the opportunity of repeating it.
As to lack of finance, I draw the right hon. Gentleman's attention to paragraph 284 of the report, which states clearly that the committee did not believe that financial restraints or constraints above regional level were relevant to any of the issues that it considered. As to the regional health authority and the delay in the building of the new hospital, I have made it clear that I deplore the delay. The report makes it clear that the delay has been caused by people failing to take decisions. We hope—this is our aim—that the position will be improved after the introduction of a general management process.
Several Hon. Members rose—
Mr. Speaker: Order. I shall call those hon. Members who have been standing, but I ask for brief questions.
Mr. Merlyn Rees: Is the Secretary of State aware that although Stanley Royd hospital is in Wakefield and in the constituency of my hon. Friend the Member for Normanton (Mr. O'Brien), it serves a much wider area and there is great concern about what happened 18 months ago? My constituents want more information about what happened. I welcome the right hon. Gentleman's statement and the report, although I have not yet had an opportunity to read it. After we have digested the report, we shall want another debate on the Floor of the House so that we may ask the Secretary of State more questions. Before then will he undertake that

199
when he receives replies to the questions that he says he has asked, he will give that information to the House? If he does not, the report by itself will not be enough.
Whatever the problems with Crown immunity—they have arisen in previous Administrations and they affect the entire Government service—are not hospitals a special case? If this incident had occurred in a BUPA hospital, criminal proceedings could have been brought and Crown privilege would not have applied. Should we not change the system so that what is good enough for BUPA patients is good enough for Health Service patients?
Mr. Fowler: I agree that the case against Crown immunity is much stronger when it comes to hospitals than in almost any other area. For that reason, my right hon. Friend and I are reviewing the matter urgently. I also agree that this is a serious matter, and I do not wish to leave the House in any doubt about the Government's determination to tackle it. I and my right hon. Friend will do everything that we can to keep the House informed of all developments.
Mr. Alec Woodall: This is one of the most depressing reports that I have ever read. I agree wholeheartedly with my right hon. Friend the Member for Morley and Leeds, South (Mr. Rees) that we need a further debate on a 140-page report. Does the Secretary of State accept that I am disappointed that he did not refer to paragraphs 307, 308 and 309 under the heading, "The Press and Media"? Does he agree that it was disgraceful that a reporter and a photographer, one wearing and one carrying a white coat to disguise themselves, smuggled their way into the hospital, and that other reporters badgered patients and staff in an attempt to trivialise and dramatise the affair?
Paragraph 190 of the report states that the kitchen was understaffed. Does the Secretary of State accept that if the kitchen is understaffed before privatisation, it is likely that the position will become even worse if privatisation is forced on local health authorities? The paragraph states that there was 35 per cent. absence due to sickness and accidents. Is that not unacceptable in a hospital of that sort with so many patients?
Mr. Fowler: I do not accept what the hon. Gentleman says about the future policy of contracting out. It has nothing to do with this case. I shall discuss with the health authority chairman staffing in the kitchen, I must tell the hon. Gentleman that the basic problem was not staffing, but that laid-down and well-understood procedures were simply not followed. That was largely responsible for the outbreak.
I agree with what the hon. Gentleman said about the press and the media. I hope that the newspapers concerned will study paragraphs 307, 308 and 309. Hon. Members on both sides of the House will find it objectionable that patients at that hospital should have been so approached. The report makes some criticisms, and the press should study them.
Mr. Archy Kirkwood: Does the Secretary of State accept that the entire National Health Service community will attach much importance to what the Government do about this report? Therefore, it is doubly important that he takes the appropriate action now. I have not had the advantage of reading the report, but it seems from the right hon. Gentleman's statement
200
that there was a management and supervisory malfunction. Does he accept that that will not be the case in the vast majority of the 40 to 50 outbreaks that we suffer each year, but that they will have been caused by a lack of resources? Far from giving guidance and reiterating his guidance, will he now insist that health authorities appoint hospital kitchen inspectors with authority to ensure that those supervisory functions are correct, and will he give the health authorities the resources to carry them out? May I also ask him—
Mr. Speaker: Order. Briefly, please.
Mr. Kirkwood: The Secretary of State said that the inquiry into the control of communicable diseases would be restricted to England. Can it not be extended to Scotland?
Mr. Fowler: The public health inquiry will be carried out by the Chief Medical Officer, but it will have lessons for Scotland, too. The report makes it clear that a lack of general finance did not cause this outbreak, and I know of no evidence on which the hon. Gentleman could base his argument. A management and supervision failure led to the problems that we are discussing.
Mr. Willie W. Hamilton: Is it not interesting that the report should have been published the day after a televison programme exposed the danger and the filth in many hospital kitchens? Despite what the Secretary of State said today, is it not true that this terrifying disaster could be repeated at any time in any hospital? All the authorities represented on the programme last night said that the prime causes of the outbreak were a lack of funds and the continuation of Crown immunity. In those circumstances, will he give a categorical undertaking that the Government will introduce legislation' this Session to abolish Crown immunity?
Mr. Fowler: I cannot give the undertaking for which the hon. Gentleman asks. I have asked for an urgent report from the health authorities featured on yesterday's Granada programme, and I have made it clear to the health authority chairmen that whatever action is needed should be taken without delay. I shall talk to all the regional health authority chairmen next week at a meeting in Birmingham. The evidence in the programme is challenged by some district health authority chairmen, and I think that we should delay making a final decision on the matter until we consider more closely the points that were raised.
Mr. Frank Haynes: Is the Secretary of State aware that the Stanley Royd incident has highlighted the real problem within the National Health Service? He is charged with the full responsibility of making sure that everything is put right. I warn the Secretary of State not to block any private Bill in this House proposing the abolition of Crown immunity.
Mr. Fowler: I hear what the hon. Gentleman says. He has raised the general responsibility issue. I hope that in his turn he will support the introduction of general managers at regional, district and hospital level so that we may get better and more effective decision taking.
Mr. Charles Kennedy: Despite the comments that the Secretary of State quite rightly made about the report highlighting general management problems at various levels, is he aware that the report also refers to the nurses in paragraph 292 and says:

201
"Furthermore, we heard how the nurse staffing position at Stanley Royd was one of the least favourable in the country and had been so for years."
When that statement is read in conjunction with the statement quoted by the hon. Member for Southend, East (Mr. Taylor) and others about the lack of supervisory staff in the kitchens, do they not suggest to the Secretary of State that funding problems have a part to play in the explanation, despite his protestations this afternoon?
Mr. Fowler: No, I do not think that that is the case. When the hon. Gentleman looks at the report he will see, for example, that the district was underspending on its Stanley Royd nursing budget. As for the nurse-patient ratio, that has improved overall since 1979 in terms of both trained and untrained nurses.
Mr. Frank Dobson: To help the House to get this hospital into perspective, will the Secretary of State confirm that it was built in 1818 when Napoleon was alive and that it was called the West Riding paupers lunatic asylum? Does he have some sympathy for the staff who are trying to provide services for patients in those circumstances? Will he confirm that when it was last calculated for hospitals of this type, the average spending was £40 per patient per day, but that at Stanley Royd it was only £25 per patient per day? Will he also confirm that in paragraph 274 the report says that the committee had already
"identified two areas in which additional expenditure was required, first in the level of nursing staff, and second in the catering facilities and staff."
The catering manager is also reported as having said that she understood from her predecessor that it was no good asking for extra equipment because no money was available.
Will the Secretary of State also confirm that after the previous salmonella outbreak in 1979 at Stanley Royd
202
there were four years of bumbling incompetence, including, if he reads the report carefully, that of his own officials, not just the regional and district officials? Will he confirm that that continued for four years and that they argued not just about design and necessity but about availability of finance? Will he also confirm that the report contains no fewer than four pages of criticism by the environmental health officers of the standard of the kitchens? Will he further confirm that there are two pages in the report where the committee says that although it does not believe, on the strength of the evidence available to it, that Crown immunity should be abolished, it accepts that it leads to a difference of approach by the officers to inspections of hospital premises and other premises? Does not the Secretary of State agree with most sensible people that the source of this problem springs from that difference of attitude?
Mr. Fowler: I do not think that the hon. Gentleman can claim the support of the inquiry's report on everything that he has said and then come to that conclusion. The inquiry's report suggests not that Crown immunity should be abolished, but that there should be a new system of Crown notice. This means that where there is Crown immunity a notice is served on the health authority by the environmental health officer. That is the proposal that is contained in this report. The hon. Gentleman's description of this hospital was right. It was built in the 19th century. But again the report of the inquiry makes it quite clear that it was not the inherent physical defects in the hospital that were responsible for the outbreak but other factors. The conclusions are set out on page 106 of the report. It says:
"All the rules and principles of good catering practice"
were known. The fact is that those rules were not followed. I hope that, whatever differences there are between the Opposition Front Bench and the Government, we can get more effective management into hospitals because it is in everybody's interest that these kinds of outbreaks should never occur.

Interest Rates
4.46 pm
Mr. Roy Hattersley: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 10, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the imminent further increase in interest rates."
Indeed, the money market rates have increased since Question Time began this afternoon.
The matter which I seek to raise is urgent because real interest rates are already at their highest level in our history, and up to three times higher than the rates in the economies of our major industrial competitors. A further escalation in interest rates will be disastrous for investment and employment, and a catastrophe for mortgage holders, who are already paying the highest real mortgage interest rates ever recorded in Great Britain.
My next point is that the Government are directly responsible for these matters and are answerable for them in the House of Commons. The Government's responsibility for the crisis is not in doubt. First, it is the Government who have made the British economy peculiarly dependent upon the price of oil—the direct trigger for the catastrophe that we now face. Secondly, the Prime Minister and the Chancellor of the Exchequer, in his Mansion house speech and later, have both asserted that an artificially high control rate is necessary for monetary control and that they will hold interest rates at whatever level and will escalate interest rates to whatever level is necessary to hold the exchange at the artificial level that is necessary to protect their monetary policy. They have asserted that they will hold interest rates high, regardless of the other consequences for the real economy.
204
Therefore I submit to you, Mr. Speaker, two sentences in summary. The first is that the imminent additional increase in interest rates will be deeply to the detriment of the real economy and the householders of this country. The second is that the imminent increase in real interest rates is a matter which is directly within the responsibility of the Government. Indeed, it has been managed, manipulated and encouraged by the Government. In those circumstances, it is, in my view, essential for the House to debate this issue before the Government's folly does yet more damage to the real economy.
Mr. Speaker: The right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) asks leave to move the Adjournment of the House, under Standing Order No. 10, for the purpose of discussing a specific and important matter that he believes should have argent consideration, namely,
"the imminent further increase in interest rates."
The right hon. Member and the whole House know that I am required to take into account the various factors that are set out in Standing Order No. 10. I have listened with great care to what the right hon. Member has said, but I regret that I do not consider the matter that he has raised to be appropriate for discussion under Standing Order No. 10, and I cannot therefore submit his application to the House.
Mr. Hattersley: On a point of order, Mr. Speaker. I understand the many considerations that you have to take into account and what you have described as the many implications of this application. I do not argue with your judgment in any way. I merely say that it will be necessary for the House to examine those many implications when the interest rate goes up tomorrow or the day after.

Westland plc
4.49 pm
Mr. Speaker: In accordance with my undertaking to the House yesterday, I have looked at the speech made by the Secretary of State for Trade and Industry last Thursday, and in particular at the passage in that speech in col. 1167 of the Official Report which the hon. Member for Workington (Mr. Campbell-Savours) alleges to be a quotation from an official document.
The passage in question describes what happened at a meeting on 17 October last between the Secretary of State and Sir John Cuckney. The passage is couched in reported speech, and as such is in the appropriate form for a paraphrase of the minutes of the meeting on which it is doubtless based. Therefore, I rule that it is not a quotation.

Privilege
4.51 pm
Mr. Tony Benn: Mr. Speaker, I rise to seek your guidance on a matter of privilege.
Late last year I was invited to give evidence to the Treasury and Civil Service Sub-Committee, which is examining the relations between civil servants and Ministers following the Ponting case. I was sent a questionnaire, to which I responded at length, and in the course of my reply I drew attention to the document issued by every Prime Minister to all Ministers entitled "Questions of Procedure for Ministers", and I attached a photocopy of that document, sent to me by the right hon. Member for Cardiff, South and Penarth (Mr. Callaghan) when he formed his Administration in April 1976. However, because that document is classified as confidential I laid claim to parliamentary privilege for it, both in respect of its status as evidence submitted to a Select Committee, and for myself as a member of the House, in submitting it.
This document lays down in great detail the rules which hon. Members of this House, who happen to be Ministers or Parliamentary Private Secretaries in any Administration, are required to obey, and yet the nature and extent of those rules are kept secret from other Members and from the public. Because one of the questions to which I was invited to respond related to the operation of the Official Secrets Act, this particular document was, and is, directly relevant, and constitutes an integral part of my submission. I am due to give evidence, in public, tomorrow afternoon.
Last night I received a letter from the right hon. Member for Worthing (Mr. Higgins) who is Chairman of the main Committee, referring to my evidence and to the document, which he points out
"is classified as 'Confidential' and subject to the 30 year rule".
His letter continues:
"The Committee has not yet decided whether it would be appropriate or not to report and publish this in whole or in part. Consequently, if in the course of oral evidence you wish to refer to, or quote from the annex, the sub-committee propose to hear such evidence in private."
Thus, Mr. Speaker, if I refer to or quote from a document which is absolutely central to my evidence, the public hearing may be terminated, hon. Members of the House, who are not members of the Sub-Committee, but who are present, and the public may be excluded. Ministers, civil servants and others sometimes give evidence in secret for reasons of state or commercial confidentiality, but I do not know whether there are any precedents for Select Committees hearing evidence from private Members in secret.
However, I accept that it must be entirely a matter for the Sub-Committee whom it invites to give evidence, whom it hears, whether to hear them in public or private, and what it does with any evidence submitted. Similarly, it must be entirely a matter for me to decide whether I should agree to give evidence in secret on the question whether the present Official Secrets Act should be allowed to protect the type of rules imposed by successive Prime Ministers on other Ministers. If I agreed to do so, I might myself be in breach of the privileges of the House if I subsequently disclosed the nature of the evidence which I had given in secret session.

207
These are not questions that I can put to you, Mr. Speaker, but the questions which I submit concern the whole House, and you, Sir, relate solely to the status of the evidence submitted to Select Committees by Members, where that evidence is heard in private, when it may neither be alluded to nor published in the report of the Committee. The evidence I submitted was explicitly sought by the Sub-Committee, not volunteered by me.
I seek your guidance, Mr. Speaker, on these questions. First, is evidence submitted by Members to Select Committees privileged? Secondly, are Members or others who submit such evidence to the House protected from prosecution under the Official Secrets Act? Thirdly, will you authorise me to place a copy of my evidence in the Library of the House, an act which requires your approval, and which would constitute publication? Fourthly, what is my position if I publish my own evidence in full, and claim privilege for it?
I appreciate that these are difficult questions on which I cannot expect a ruling today, but I would be grateful if you could give a ruling before my appearance at the Sub-Committee tomorrow.
Mr. Speaker: I am most grateful to the right hon. Gentleman for giving me notice of the questions, because it has enabled me to look into the matter.
He has asked for guidance on a matter of privilege. It is not the function of the Chair to take up the time of the House by giving guidance to Members on matters of privilege or procedure, because hon. Members can obtain such advice outside the Chamber. That deals with the right hon. Gentleman's questions Nos. 1, 2 and 4. His third question was about my authorising him to place a copy of his evidence in the Library. I will look into the matter and let him know my findings.
Mr. Dennis Skinner: On a point of order, Mr. Speaker., Have we not reached a tidy state of affairs? Over the past few days, documents have been leaked right, left and centre. The Secretary of State for Trade and Industry, to whom you referred in your previous ruling, was paraphrasing from Cabinet documents. One thing led to another, yet here we have a Back Bencher who wants to submit evidence to a Select Committee that is dealing with open government, and he has been told he has to give his evidence in secret. The whole thing is a farce.
Mr. Speaker: What goes on in a Select Committee is not a matter for me, and the hon. Gentleman knows that.
Mr. D. N. Campbell-Savours: On a point of order, Mr. Speaker.
Mr. Speaker: Order. I have dealt with the hon. Gentleman's point of order. I regret that he was not in the Chamber at the time, but I have dealt with it and I have nothing to add.
Mr. Campbell-Savours: I apologise for not being here. I was in a meeting of the Select Committee on Members' Interests, where indirectly it might be said that the matter that I am about to raise was being dealt with.

Select Committee on Defence
4.58 pm
Mr. Campbell-Savours: The point of order I wish to raise concerns the membership of the Select Committee on Defence, which has been meeting since 4.30 this afternoon. As you will know, Mr. Speaker, one of the members of that Committee is the hon. Member for Arundel (Mr. Marshall). The hon. Gentleman sits on the Committee as a Member of this House, and he is also a parliamentary adviser to British Aerospace. Last weekend, because of his unique position, the hon. Gentleman was able to arrange for a joint statement to be made by the Secretary of State for Trade and Industry and the chairman of British Aerospace in order to, let us say, defuse what at that time was a rather embarrassing public row.
I want to raise the matter of the hon. Gentleman's membership of that Committee, in the context of the Committee's current investigations. "Erskine May" says on page 684:
"In the nomination of Members to serve on select committees neither the House, nor, where the nomination is entrusted to the Committee of Selection, the Committee of Selection, is bound to consider whether Members are personally interested in the matter or bill referred to the committee, and no objection can be raised in this respect to the composition of the committee".
That means the Committee of Selection is not in a position to examine whether the hon. Gentleman's membership of British Aerospace would in any way influence his judgment as a member of that Committee. One would have thought that you, Mr. Speaker, would have alluded in your reply to the fact that the Select Committee cannot deal with the problem that arises, notwithstanding the fact that the hon. Member for Arundel still represents British Aerospace and is paid to do so.
On page 684 "Erskine May" goes on to say:
"But it is not the practice for a member of a select committee to take part in any Enquiry while the affairs of any body in which he may be personally interested are under investigation".
I submit that the affairs of British Aerospace are, in part, under investigation. Basically, what "Erskine May" means is that it is not the practice for hon. Members to involve themselves in those inquiries, but the hon. Member for Arundel is today sitting upstairs in a Committee which is dealing with precisely these matters. You, Mr. Speaker, might consider making a statement, if not a ruling, that in the light of the precedent in "Erskine May" the hon. Member for Arundel might wish to consider his position, in so far as it is not the practice of the House for him to be involved in any investigation of that nature.
Mr. Brian Sedgemore: Further to that point of order, Mr. Speaker. I want to point out that I wrote to the Clerk of the Select Committee on Defence yesterday about the issue. I am surprised that the Member for Arundel (Mr. Marshall) is in Committee upstairs. I have not had a reply to my letter.
Mr. Willie W. Hamilton: Further to that point of order, Mr. Speaker. You are probably not aware that two or three years ago Sir Albert Costain was a member of a Select Committee that was investigating the building of a children's hospital in Glasgow, which had cost many millions of pounds and which within a few years started to fall down. The principal contractor for that hospital was Costains. Sir Albert honourably said that although he was not directly involved he would, to

209
maintain his own integrity, walk out of the investigation. He was a man of great honour and integrity. I hope that the hon. Member for Arundel (Mr. Marshall) will do the same as Sir Albert did.
Mr. Speaker: I think that I can dispose of the matter now. That is a matter for the hon. Member for Arundel (Mr. Marshall).
The hon. Member for Workington (Mr. Campbell-Savours) quoted "Erskine May". I say to him and to the other hon. Members who have raised the matter that the position from their point of view is clear. If they wish to make a complaint of this nature about the hon. Member for Arundel (Mr. Marshall), they should make it to the Select Committee on Members' Interests, which, as hon. Members will see from Standing Order No. 107, is set up specifically to deal with matters of this kind.
Mr. Alan Williams: On a point of order, Mr. Speaker. I fully appreciate the difficulties where there is a ruling and a difference in practice. We have a difficult problem before us. The hon. Gentleman—I emphasise "hon. Gentleman" because I am in no way impugning the integrity of the hon. Member for Arundel (Mr. Marshall), for whom I have the greatest personal respect—acted as an intermediary in trying to resolve the peculiar problems that arose because of one letter from British Aerospace and a complete volte face in a further ambivalent letter that appeared last weekend. It seems utterly improper that the hon. Member should be sitting to adjudicate on a matter to which he was a party.
May I extend this a stage further and ask you, Mr. Speaker, to give us advice, though not now? It goes wider. I do not think that we can wait for a decision of the Select Committee on Members' Interests, when we remember that a further Committee of perhaps far greater importance is about to be established, namely, the Hybrid Committee which will deal with the Channel tunnel. What guidance can you give as to the possible composition of that Hybrid Committee when one bears in mind the controversy that there was over a Select Committee on Transport because some of its members had interests which were not declared?
Mr. Dennis Skinner: Further to that point of order, Mr. Speaker. I do not think you should be placed in the position of allowing double standards to operate here. This must seem strange to a person outside this building, because, when a Member of Parliament is named, a chief of police escorts him from the building within three minutes. On one occasion the Serjeant at Arms attempted to escort me from the Chamber. Given those examples, why is it impossible to ensure that the hon. Member for Arundel (Mr. Marshall), who is obviously breaking the rules, is told, not to leave the building, but to get off the Committee? Why can that not be done?
Mr. Speaker: We are only wasting time on the matter, because it can be done. I did not appoint the hon. Member for Arundel to the Select Committee. He was appointed by the House. I have no power to take him off that Committee. The House well knows that. It is a matter for the House. Under our procedures we set up Committees specifically to deal with issues of this kind. I have already
210
said to the hon. Member for Workington that his right course is to draw the matter to the attention of the Select Committee on Members' Interests. I say again that it is not a matter for me, because I did not appoint the hon. Gentleman to the Committee.
Dr. M. S. Miller: Further to that point of order, Mr. Speaker. I feel that we are making ourselves somewhat ridiculous in the eyes of people who think that as a legislative assembly we should be able to deal with these things as they arise. I do not know how we can resolve this problem, but matters like this arise from time to time. May I suggest that this subject might be taken on board by the Speaker's Conference?
Mr. Speaker: That is as may be, but it is hypothetical at the moment. I say again that I am being put in an impossible position if the House expects me to adjudicate on a Member's conduct. I did not appoint the hon. Member for Arundel to the Committee. The House appointed him to the Committee, and the matter is in the hands of the House. The simple way to resolve this problem is through the usual channels.
The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): May I intervene, since charges are very easily thrown around in these circumstances? It has been asserted that my hon. Friend the Member for Arundel (Mr. Marshall) is breaking the rules. I should like to seek confirmation from you, Mr. Speaker, that he is not breaking the rules.
Mr. Speaker: That is true. The hon. Gentleman is not in any way breaking the rules. He was appointed by the House to the Select Committee, and the hon. Member for Workington has fairly pointed out in his quotation from "Erskine May" that the question of his remaining on the Committee and his activities on it are entirely a matter for him.
Mr. David Winnick: Further to that point of order, Mr. Speaker. Of course, it is not a matter simply of the hon. Member for Arundel (Mr. Marshall) breaking the rules or not. If you rule that he is not, obviously he is not. The point is taken. Is it not important that justice should be seen to be done? I am not saying that the hon. Gentleman has played a dishonourable role, but he negotiated the letter which the Secretary of State for Trade and Industry agreed to accept from the chief executive of British Aerospace. You have said that this is a matter for the Select Committee on Members' Interests. Clearly, the Committee will not be in a position to take action until the Select Committee which is looking into the Trade and Industry matter has completed its findings. What purpose would be served then?
Mr. D. N. Campbell-Savours rose—
Mr. Speaker: Order. I shall take one more question from the hon. Member for Workington. In regard to what the Leader of the House has said, no doubt the hon. Member for Workington will have given notice to the hon. Member for Arundel that he intended to raise the matter.
Mr. Campbell-Savours: Yes, I wrote to the hon. Gentleman. May I make it clear that I am not accusing the hon. Member for Arundel of breaking the rules. I have not done that. What I have done is to draw attention to the fact that there is precedence for the practice, and it is a practice on which I thought you might wish to comment, Mr.

211
Speaker. If you were to draw the attention of the hon. Gentleman to the practice, he might feel that it was in his best interests not to proceed as he has done. There is a precedent which I should like to quote in regard to a Select Committee on National Expenditure, which met in 1943:
"Major C. S. Taylor asked the hon. Member for Kidderminster, as Chairman of the Select Committee on National Expenditure, whether he will give an assurance that when any investigations are carried out into the organisation or activities of any private or public company, firm or corporation, no member of the Select Committee who is directly interested in that concern or in any competitive business sits as a member of the committee or sub-committee that is charged with this task?
Sir John Wardlaw-Milne: Yes, Sir, to the limited extent to which the Question applies to the inquiries of the Select Committee, it is our practice"—
note, "practice"—
"that a Member would not so take part."—[Official Report. 14 December 1943; Vol. 395, c. 1402.]
We are talking not about rules, but about practice. My appeal is that you, Mr. Speaker, may wish to guide the hon. Member for Arundel as to practice so that he can remove himself from the embarrassing position in which he has placed himself.
Mr. Speaker: It is not necessary for me to do that because the hon. Member for Workington has given notice to the hon. Member for Arundel that he intended to raise the matter. The hon. Member for Workington has said that the hon. Gentleman is not acting in any way outside the rules. It is my function to see that the rules are maintained. There is no way in which I can help the hon. Member for Workington. It is not for me to comment on matters of this kind. The Select Committee on Members' Interests was set up specifically to deal with matters of this kind, and I cannot do anything about it.

Protection of Minimum Retirement Age
5.10 pm
Mrs. Ann Clwyd: I beg to move,
That leave be given to bring in a Bill to secure a guaranteed minimum retirement age for men and women of sixty years, subject to certain conditions, and for connected purposes.
Most of us are aware of the existence of sex and racial discrimination. There are laws in existence to attempt to combat those types of discrimination but there are no laws to deal with discrimination against people because of age. There is growing evidence that this type of discrimination occurs mainly in employment. Compulsory retirement is the most obvious way that age is directly related to employment. It is important to realise that job discrimination in the employment market begins at a much earlier age than 65 or 60, in some cases at 35. This is why I stress that people should be able to work, if they wish, at least until the age of 60.
Age discrimination affects those who are trying to get jobs and those whose present jobs are at risk. The numbers in both groups have risen sharply since 1979. The purpose of the Bill is to ensure that discrimination against people in employment or seeking employment on the basis of their age should be made illegal.
A year ago, at a factory in my constituency owned by the Japanese firm Hitachi, the management invited the workers aged 35 or more to take so-called voluntary redundancy. The management told them in no uncertain way that British workers were over the hill at 35. In a letter to all its employees the company said that older workers cause problems through sickness, slower reactions, poor eyesight and resistance to change. The company also invited these old-timers, in their late thirties, to leave the company to make way for younger people. It offered a ta x-free payment of £1,800 to those taking up its invitation. The company also gave the workers the chance to nominate a 16-year-old school leaver to take their place. The letter to the workers, or "company members", as the Japanese like to put it, pointed to the continuing losses at the south Wales factory and maintained that one problem standing in the way of increased efficiency was the age profile of the workers. Eleven employees took up the offer.
Hitachi is not alone in being averse to older workers. According to the Trades Union Congress, in the private sector there has been a huge increase in voluntary early retirement as an alternative to redundancy. In many cases the voluntary nature of such arrangements is open to question and it is clear that many older members feel under pressure to make way for youngsters when they would prefer not to retire.
Age discrimination has been accelerated in recent years by the massive increase in unemployment since 1979. Job adverts frequently impose upper age limits. Long-term unemployment among older workers has increased since 1979 by 300 per cent. and those caught in the trap are likely to suffer the consequences for the rest of their lives. Surely age and experience are qualities which should not be tossed lightly aside. Indeed, on the basis of age limits now set by many employers, many Members of this House would no longer be at work.
It is not surprising that a number of countries have laws which preclude or limit the use of chronological age as an

213
automatic exclusion factor in retirement and employment practices. In Britain, the majority of those living exclusively on state benefits, including pensions, are not far removed from poverty. The problems of long-term unemployment concern the over-50s rather than school leavers and it is understandable that demands for the removal of discriminatory practices, based solely on chronological age, have become more insistent in Britain.
However, practices concerning recruitment, training and promotion use age enthusiastically despite its lack of objectivity. An advertisement which appeared in the press recently stated:
"It is unlikely that anyone outside 35 years of age will have the necessary experience or drive essential for the rapid achievement required."
If a person is over 35, he is beyond the pale. Imagine the same advertisement saying "It is unlikely that a woman or a black person will have the necessary experience or drive essential." No one could put such an advertisement in the papers. If he did, it would be illegal. Why is the first version allowed? If some employers can get away with it, others will try to do the same.
Young people are cheaper to employ and it can be argued that they can get lower rates in their first year because they are supposed to be training. There are also cases of indirect discrimination, applying the requirements or conditions apparently equally to both sexes, with the result that one sex is less able to comply.
One of the most recent cases of indirect discrimination is that of Belinda Price, who married early and left her job to bring up her young family. She later qualified as a mature student and then applied to join the Civil Service as an executive officer. She was refused entry to that level because the age limit was 28 and she was 32. An industrial tribunal found this service condition "indirectly discriminatory", because more women than men rear children during the traditional recruitment years. The Civil Service has since raised the age limit to 45 in this grade. The Civil Service has declared itself to be an equal opportunities employer, but it is again defending a rigid age limit of 32 years for those applying for entry to the fast stream administrative grades of the Foreign Office, despite the fact that only one woman in 140 is in the top three grades.
214
In his book "40-60: How We Waste the Middle-Aged", M. P. Fogarty says:
"…at whatever age, chronological age turns out to be a poor predictor of performance in a wide range of activities. People at any age are individuals, differing within their overall capacities and in their profile of individual capacities. If one is looking for a woman or man who can put up a certain level of performance—whether high, average or low—on a certain task, one is likely over a very wide range of tasks to have to search all groups to find the right one."
In 1949, the United Nations Commission on Human Rights argued that the association of age with discriminatory practices results in
"detrimental distinctions which do not take account of the particular characteristics of individuals."
Over the years a number of countries have responded, but so far the United Kingdom has enacted no relevant legislation—although, on at least four occasions, attempts have been made to deal with this matter by private Members' Bills. There has been a recognition of age dicrimination or agism—the holding of a particular image of someone on the basis of formal age—in France, West Germany, Sweden and the United States which have legislated against it. In the United States the trend seems to be running against compulsory retirement. A law came into effect in New York State last year which does away with age discrimination at any age in the public sector. This year New York State expects to abolish it in private employment.
Age discrimination can have as serious personal and economic effects for an individual and society as racial and sex discrimination. For this reason, I argue, there is a need for legislation, and I hope that the House will support me.
Question put and agreed to.
Bill ordered to be brought in by Mrs. Ann Clwyd, Ms. Jo Richardson, Ms. Clare Short, Mr. Richard Caborn, Mr. Clive Soley, Mr. Doug Hoyle, Dr. John Marek, Ms. Harriet Harman, Mr. George Foulkes, Mr. Brian Sedgemore, Mr. Roland Boyes and Mr. John McWilliam.
Mrs. Ann Clwyd accordingly presented a Bill to secure a guaranteed minimum retirement age for men and women of sixty years, subject to certain conditions, and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 21 February and to be printed. [Bill 61.]

Orders of the Day

  Atomic Energy Authority Bill [Lords]
  Order for Second Reading read.
  5.20 pm
  The Parliamentary Under-Secretary of State for Energy (Mr. Alastair Goodlad): I beg to move, That the Bill be now read a Second time.
  The objective of the Bill is to put the finances of the United Kingdom Atomic Energy Authority on to a trading fund basis, and for connected purposes. Hon. Members will recall that I said that legislation would come forward on these matters when I made a statement on the Government's decisions on the AEA review on 11 February 1985.
  As is customary, I should like to start by explaining the background to the Bill. As hon. Members will know, the United Kingdom Atomic Energy Authority was created by the Atomic Energy Authority Act 1954 with a wide range of responsibilities for nuclear matters. It was initially almost entirely funded by the Government. Since then, the authority has undergone a number of significant changes. The Science and Technology Act 1965 gave it the power to carry out non-nuclear research and development as required by the Secretary of State. The Atomic Energy Authority Act 1971 hived off the radiochemical activities of the authority to what is now Amersham International, and the fuel manufacture, enrichment and reprocessing work to British Nuclear Fuels plc. Under the Atomic Energy Authority (Weapons Group) Act 1973, the weapons group of the authority was transferred to the Ministry of Defence.
  The context in which the authority operates has also changed significantly. In 1954, the authority effectively was the nuclear industry. Since then, other centres of expertise have grown up with the design, construction and operation of the United Kingdom's nuclear power stations. In 1984, more than 18 per cent. of electricity supplied in the United Kingdom was nuclear. This contribution should reach as much as 25 per cent. by the end of the decade when reactors currently under construction, or being commissioned, are fully operational. These reactors have required a corresponding development of fuel fabrication and reprocessing facilities, where important export orders have also been obtained.
  Nevertheless, the authority is still a very major force. It employs some 14,000 staff and has gross expenditure of about £400 million per annum. About half its income has recently come in the form of a grant-in-aid from the Department of Energy for nuclear research and development. The remainder comes mainly from contract work on nuclear research and development for other United Kingdom customers such as the electricity supply industry BNFL and from customers for non-nuclear research and development. A large part of the authority's work is therefore already under contract and is held in very high regard for its scientific and technical excellence.
  It is against that background that my right hon. Friend the Secretary of State for Energy set in hand last year a wide-ranging overall review of the role and activities of the authority, including whether its present relationship with the Department of Energy remained appropriate. The terms of reference were:
  216
  "to examine the main programmes of the authority, with reference to the character, funding and accountability for these programmes and their bearing on the role of the authority; to consider, in the light of the review and of other factors, whether changes were required in the role and accountability of the authority, and in its relationship with the Government: and to make recommendations to the Secretary of State for Energy."
  My right hon. Friend published an extensive summary of the review's conclusions and recommendations on 3 October 1984, and I announced the Government's decisions to the House on 11 February last year.
  Mr. John Evans: Many employees in the industry are worried that the Secretary of State did not publish the review committee's report in full. Why did the Secretary of State not publish the full report? If representations are made to him during the Bill's passage through the House, will the Secretary of State publish the entire report?
  Mr. Goodlad: My right hon. Friend the Secretary of State said, as did I in reply to a question asked by the hon. Member for Midlothian (Mr. Eadie), that the conclusions and recommendations were the main part of the review, and it is not customary to publish a confidential internal piece of advice.
  It might be helpful if I remind the House of the key points. The Government consider it prudent for the country to have a range of electricity supply options and continue to attach importance to the safe and economic development of nuclear power. The authority's role as a research and development organisation underpinning the nuclear industry, exploring how the technology might develop, and providing independent advice to Government therefore remains a key one.
  The Government have endorsed the two guiding principles recommended by the review team. The first is that the authority should move to a fully commercial basis of operation as a further spur to efficiency; and, secondly, that defined customer-contractor relationships should be applied as far as possible to its work. The group concluded that privatisation of the authority either in whole or in part was not a realistic option at present. I should like to take this opportunity to reiterate what I said on 11 February last year, and which my noble Friend Lord Gray confirmed recently in another place—that the Government have no intention of privatising the authority.
  The Government have decided that more of the authority's work should be funded by the nuclear industry, that the Department of Energy's funding of nuclear research and development should move closer to a customer-contractor basis and that the authority's operations should be placed on a trading fund basis from 1 April 1986 with powers to borrow.
  As a trading fund, the authority's charges to all of its customers will include an element of profit, and clear financial objectives will aid the measurement of success. The authority will prepare a profit and loss account and be able to carry surpluses and deficits forward from one year to the next. It will thus have increased flexibility and greater discretion over the use of internally generated funds, which will help to finance an agreed capital investment programme. Remaining capital requirements will be financed through borrowing. I shall outline the new financial framework that we propose in a little more detail shortly, but first I should like to emphasise three points, concerning nuclear safety, the AEA's independence, and accountability.

  217
  I deal first with safety. In reaching decisions on the review's recommendations, the Government recognised the authority's crucial contribution to the development of civil nuclear power and high nuclear safety standards in Britain. Safety is paramount and the authority will continue to play a major role in the United Kingdom in nuclear safety research and development. The Government and the generating boards attach importance to the authority's independent capability in this area. The Department of Energy will therefore continue to fund a substantial programme of thermal reactor and general nuclear safety research by the authority. In 1986–87 this funding is expected to total more than £20 million.
  The next matter of importance is independence. I should like to reassure hon. Members that, although other parts of the nuclear industry, particularly the generating boards and BNFL, will be placing more contracts with the authority in areas of research and development most relevant to them, that does not imply a reduction in the authority's independence. It is sometimes asserted that the authority will be dominated by the Central Electricity Generating Board. The House may therefore like to know that even when the transfers of funding that I announced on 11 February last year have been taken into account the proportion of the authority's total turnover accounted for by the CEGB is still expected to be less than 15 per cent. The authority will have a range of customers and will not be beholden to any particular interest group.
  Underlying research is another area where the authority's continued independence is of key importance. Such research underpins all that the authority does, just as the authority underpins the nuclear industry. By consciously devoting resources to a broad and interdisciplinary programme of underlying research during the past 30 years, the authority has been able to keep at the forefront of technological change. The research has been of enormous benefit to its customers over the years and is the seedcorn for the future.
  Through a levy on other programme charges, the Department of Energy will still make a very significant contribution to the funding of the authority's underlying research programme, which will amount to more than £16 million in 1986–87. Other customers will also contribute but the content of the programme will remain firmly under the authority's control. The Government consider that these arrangements will enable the authority to continue a vigorous and independent programme, as it is essential that it should.
  The third important matter to which I referred is accountability. I should like to repeat the assurance that I gave the House on 11 February last year. There will be no loss of accountability for expenditure on nuclear research and development as a result of the move to a trading fund. In fact the Department of Energy will, as well as remaining the authority's sponsor in Whitehall terms, become accountable to Parliament as the authority's customer in a way that it was not before. My Department will in future provide funding against programme letters setting out the Government's objectives in each area of research. We will be monitoring the work done and the money spent by the authority against the milestones and estimates in these programme letters, with the objective of ensuring that the taxpayer obtains value for money.
  Viscount Cranborne: My hon. Friend said that the Central Electricity Generating Board might exert undue influence as a result of the changes that he proposes. Can he give us any further guarantee of redress to make sure that if the CEGB exerts undue pressure the authority will be able to bring some heavy guns into its camp to resist such pressure, particularly perhaps from his Department?
  Mr. Goodlad: I know that my hon. Friend takes a close interest in the affairs of the authority, particularly because of Winfrith in his constituency. I have to say to him that I do not think that a guarantee of the sort that he suggests will be necessary, but I shall examine carefully what he has said.
  The Government have decided not to build up an unnecessary apparatus for control and monitoring within the Department to duplicate the resources of the authority. The programmes will continue to be funded from money voted by Parliament through the Estimates procedures, and the authority's accounts will continue to be audited by the Comptroller and Auditor General. My Department will therefore remain accountable on policy and overall programme specification, and the authority will answer on its technical advice and efficiency of programme execution.
  The programme letters will cover such research and development areas as the fast reactor, advanced gas-cooled reactors, pressurised water reactor safety, general nuclear safety, fusion, radioactive waste management, nuclear materials management, radiological protection and others. The programme letters will be settled each year following discussion between the authority and the Department, assisted by expert technical advisers.
  One of the operational areas covered by the programme letters is the authority's existing waste management and decommissioning operations. The Government have in the past accepted that they would pay the costs of meeting waste treatment and decommissioning liabilities at the time they arise. Although the authority's operations are being placed on a trading fund basis, the Government will continue 'to accept responsibility in principle for the costs which the authority will incur arising from programmes carried out before 1 April 1986, and from future departmentally funded programmes. Expenditure will be monitored and controlled through the appropriate programme letters.
  Turning now to the Government's decision to place the authority on a trading fund basis, I shall outline in a little detail the changes that we propose to the financial framework for the authority. First, the authority will have powers to borrow and a revised capital structure, including commencing capital debt, reserves and provisions. We regard a commencing capital debt as a sound feature of this revised capital structure. Full and detailed consultations have taken place with the authority and the Treasury both about the size of the debt and about the other elements of the financial framework. It is expected that the debt will be set at about £80 million. Uncertainties inevitably exist when looking to the future, but, assuming a broad continuation of the authority's existing business prospects, forward projections suggest that the authority should be left with a modest profit after payment of interest on its debt.
  The trading fund's opening current cost capital employed is likely to be in the region of £250 million. The

  219
  commencing capital debt will therefore represent about one third of this and the balance will be represented by reserves and provisions. A clear financial target has been agreed with the authority. Over the next three years, it will aim to run the business so as to achieve an annual average return of 5 per cent. on current cost capital employed. Reporting profits, before interest at this level, while still remaining competitive, will be a challenge for the authority in the early years of the fund, but not, we believe, an unrealistic one. The financial target will, of course, be reviewed in the light of the authority's trading performance in the initial three-year period and the latest assessment of future prospects.
  Overall, the Government expect the new framework to encourage the authority to maintain its excellent scientific and technical reputation, while responding effectively to the increased market and commercial pressures. The attitude of all those working in the authority is crucial to the success of the trading fund, and I pay tribute to the constructive way in which the preparations for it have been put in hand. In particular, I would like to thank Mr. Arnold Allen, the chairman of the authority, for his distinguished and effective leadership during this period.
  Many of these changes—important though they are—do not require legislation, but placing the authority on a trading fund basis with powers to borrow does, because under the 1954 Act the authority has no such powers, and as an already established body the provisions of the Government Trading Funds Act 1973 cannot apply to it. The nine clauses of the Bill therefore provide for the main structure of a trading fund without affecting the essential functions set out in the 1954 Act. In brief, their purpose is as follows.
  Clause 1 provides for the assumption by the authority of a commencing debt. This will be a debt related to the value of the authority's net assets at the start of the trading fund. The commencing debt will take the form of a notional loan from the national loans fund, deemed to be made on 1 April 1986, and repayable with interest. The period of repayment will be agreed between the authority and the Secretary of State. A commencing capital debt is a standard feature of trading funds. It reflects the fact that the Government have, in the past, grant-aided the authority so that it has been able to build up its asset base to its present levels. The commencing debt, and the interest on it, is to be repaid by the authority out of its trading profits. I have already described how it will fit into the authority's overall capital structure and financial framework.
  Clause 2 defines the authority's borrowing powers. It allows for borrowing from the national loans fund in sterling, and for borrowing from elsewhere in any currency if the Secretary of State, with Treasury approval consents. The purposes for which the authority may borrow are to discharge its functions and meet its obligations, or those of any subsidiary that it might set up. As a trading fund, it is intended that the authority should fund its capital requirements, including working capital, from internally generated funds and borrowing. The amount the authority can borrow will be subject to the overall limits set in clause 3 and to an annual external financing limit set by the Secretary of State with the approval of the Treasury after consultation with the authority.
  Clause 3 imposes an initial borrowing limit of £150 million on the authority, prescribes what is to count
  220
  towards the borrowing limit, and allows for the limit to be increased by order to £200 million if Parliament approves. Such an order would be subject to affirmative resolution. Clause 4 empowers the Secretary of State to lend to the authority and sets out the procedures governing such loans. Clause 5 permits the Treasury to guarantee borrowing by the authority from non-Government sources, and sets out the arrangements to be followed if any such guarantee is called. Clause 6 provides that the authority carry out capital investment and other developments only within plans approved by the Secretary of State.
  Clause 7 provides that compensation may be paid to members of the authority for loss of office, for which there is no provision in the 1954 Act. This clause also repeals, as anachronistic, a section of the 1954 Act which requires the Secretary of State to lay a statement before Parliament when the salaries of members of the authority are altered.
  Mr. Evans: Can the Minister tell us why the terms of the 1954 Act are regarded as anachronistic—that the terms and conditions and salaries of board members should be laid before Parliament so that they are clearly visible? Will he tell the House also the reason for a new clause which will allow compensation to be paid to any member of the board whose appointment is terminated? Does this not in effect put the present Secretary of State and subsequent Secretaries of State in a position to hire and fire, and to appoint people who better suit their requirements? It seems a peculiar clause to write into a Bill of this nature.
  Mr. Goodlad: On the contrary, it is not a peculiar clause. The answer to the hon. Gentleman's second question is no. The answer to the first question is that information about the salaries of members of all boards of statutory and other bodies is set out in the booklet "Public Bodies" published annually by Her Majesty's Stationery Office on behalf of the Management and Personnel Office. Copies of this are placed in the Library of the House. Information on the ranges of salaries of authority board members can also be found in the authority's annual report and accounts, which are laid before Parliament in accordance with the 1954 Act.
  This is a small Bill, but it is also a significant one. The effect will be to make the authority more like a nationalised industry, and to give it a greater scope for development than grant-in-aid arrangements can provide. The Government consider it to be the logical outcome of the evolution in the role and activities of the authority over the last 30 years. I should like, at this point, to emphasise again the contribution of all those who work in the authority. Their skills and dedication are the authority's most important asset. The success of the trading fund will owe much to their ability to meet customers' needs and to push forward the frontiers of technology.
  We believe that operation as a trading fund, within the financial framework that I have outlined, will provide a sound basis for the future. The authority will be able to contribute still further to the development of civil nuclear power and non-nuclear technologies, while continuing to provide a source of expert advice to Government on a wide range of issues. I believe that the proposals provide an incentive for all concerned, and I commend them to the House.
  5.40 pm
  Mr. Alexander Eadie: Our debate will be marred because hon. Members have not had access to the full Manley report, which is one of the reasons for the Bill. My hon. Friend the Member for St. Helens, North (Mr. Evans) made an intervention about that. The Department of Energy was given every opportunity to produce the Manley report, because I tabled a question asking for it to be laid before the House before we debated the Bill. The Minister has some explaining to do. Why is there such obsessive secrecy in the Department of Energy? If it does not release the report, a lasting impression will remain that the Government have something to hide.
  To some extent, we endorse the Minister's views. The Bill is not an innocent or mundane Bill; it is important. However, we are also suspicious about it. With a new Bill involving an establishment with at least 14,000 staff and 2,800 qualified scientists and engineers, housed in about 10 sites all over the country, and with a gross expenditure of around £400 million per annum, we need to know a great deal. Legislation may be inanimate, but, faced with such figures, the subject becomes more material. The people and the skills that they have are of the highest importance. That is why we shall want to hear something about the authority's best asset—its work force—and how it will fare under the Bill's proposals.
  Mr. David Maclean: The hon. Gentleman has asked how the work force would fare under the Bill. However, how would the work force fare if the motion that the last Labour conference passed by a 1·5 million majority, calling for a halt to the nuclear power programme and the phasing out of existing plants, came into effect?
  Mr. Eadie: I suggest that the hon. Gentleman makes his own speech in favour of nuclear energy when we have a debate about that. At the moment, we are discussing the Bill, and I shall be dealing with the staff later.
  One of our main suspicions about the Bill is that its provisions for putting the authority on a trading fund basis simply pave the way for future privatisation. In the other place, the Minister said:
  "Privatisation of the authority is not a realistic option at this stage."—[Official Report, House of Lords, 19 November 1985; Vol. 468, col. 527.]
  On 11 February 1985, the Under-Secretary said in the House that there were no plans to privatise the AEA. In the Second Reading debate of 19 November, my noble Friend Lord Stoddart of Swindon, at col. 537 of Hansard pressed Lord Gray of Contin in an intervention, and got an assurance that the AEA would not be privatised in the lifetime of this Parliament. We want the Minister to put on record the Government's intentions on privatisation.
  Will the hon. Gentleman also assure us that we shall not have privatisation by the back door? Can we have an explanation of what is meant by clause 3(3)? Part of it states:
  "If a body corporate ceases to be a wholly owned subsidiary of the Authority, the Secretary of State may, having regard to the extent to which the amounts taken into account for the purposes of subsection (1)".
  Clause 3(3) is about the possibility of denationalisation of a subsidiary of the AEA. Does that mean that the authority can be privatised piecemeal? The clause gives the impression that the authority may dispose of a wholly owned subsidiary without reference to Parliament. The
  222
  Minister will recognise that the matter was raised in the other place on Second Reading. I am not too sure whether it was dealt with or answered satisfactorily. I hope that the hon. Gentleman will address himself to this later.
  When I questioned the Minister on 11 February 1985, he assured me that a change of trading fund status would mean that there would be no change in accountability to Parliament. However, we did not have a Bill then, only a statement, and there is a whale of a difference. I hope that, under the Bill, commercial confidentiality will not be wheeled in as an excuse for weakening Parliament's role in nuclear matters and keeping from it information that is necessary and vital for its oversight of the authority's affairs.
  I have an example of this from the Department of Energy. Commercial confidentiality is preventing me and my constituents from getting information from the Government and the NCB about how much Lothian Estates was paid for houses and subjects in the Lewton grange area when the NCB lease expired in 1982. This is a classic example of a cover-up.
  Parliamentary control will be affected by the Bill in one way, contrary to what the Minister has said. Clause 7(2) provides that the duty to lay statements of remuneration and so on of members of the authority is repealed, as my hon. Friend the Member for St. Helens, North pointed out. Members of Parliament often glean a good deal of information from statistics about salaries and conditions of members of boards. In addition, I notice from the annual report that six members of the board are due to retire this year, and one retired in December last year. No new chairman has been appointed since the retirement of the present chairman was signified on 30 December 1985.
  Mr. Evans: I am sure that my hon. Friend appreciates my concern, and I share his, about this issue and about the number of board members who are about to retire. Is my hon. Friend aware that there is some concern among the staff and workers in the industry about the fact that some people on the highest salaries retire or leave the board for one reason or another and then subsequently reappear as consultants, often at very high fees. Surely we should be given more rather than less information about board appointments and people who are hired.
  Mr. Eadie: My hon. Friend has raised a good point. There are people who retire from Government service generally at what may be described as a comparatively early age and on adequate pensions and who then go on to other jobs and enjoy higher salaries. Something must be done about this. There should be a self-denying ordinance, if not a denying ordinance, to prevent this from happening.
  The Government's record on appointments to all types of board is not a good one. The main qualification of new appointees seems to be that they are either sympathetic to or supporters of the Tory party. We are entitled to ask how the Government propose to appoint or reappoint members of this board. I hope, too, that the Government will let us know who its new chairman will be. I hope that it will not be another merchant banker from the City. We should be told who it is to be before the Bill completes its stages in Parliament. The Minister has a lot of explaining to do on clause 7(2).
  One of the most important parts of the Bill is that which deals with the authority's finances. Clause 3 sets the authority's borrowing limit at £150 million, which may,

  223
  by order, be increased to £200 million. The borrowing limit is to include the authority's commencing capital debt. What does that entail? At one time, it was thought that it might be £50 million or £100 million. I notice that the hon. Gentleman concurs with the Minister who spoke in another place, because today he has mentioned a figure of £80 million.
  Clause 1 refers to consultation with the authority and the approval of the Treasury. As experienced parliamentarians, we know what that means. It means that the icy hand of the Treasury will be on the authority from the start. We are entitled to ask the Minister to state the rate of return expected from the authority. In his speech, he gave some figures. He knows, of course, that 5 per cent. is what is mooted. It is alleged that, based on the likely calculation of its assets, the authority could be surcharged at £13 million from the start. What sort of financial start does that give the new authority? We all know—the Minister referred to this in his speech—that if the rate of return is set too high it could affect staffing levels and indeed salaries, which could be squeezed as the authority strained to meet an unrealistic rate of return.
  Another aspect is the risk to research if an unrealistic rate of return is set. I hope that in Committee we will return to this whole question of research.
  The Minister must give not only an explanation but some assurances on the issues that I have raised.
  Turning to the effect on the fusion programme, the Minister may not be aware of it but I was the Minister responsible for the fusion programme coming to Culham. It was the first joint EEC programme that came to the United Kingdom. I know that this is not the time to discuss the details of fusion technology, but we have heard that the Government may not be as committed to this programme in future as they have been in the past—and how committed they were in the past, I am not very sure. The Minister must take the opportunity in winding up to be as informative as possible about this.
  Perhaps the Minister could also fit into his reply more information about the fast breeder reactor programme, which was dealt with in surprising detail by the Minister in the other place. Even since that time, November 1985, it has become much more important because Dounreay has become a focal point of discussion in Scotland since the proposal to have a fuel fabrication and reprocessing facility without a full-scale planning inquiry. We are entitled to an explanation of how it is envisaged that the programme will be managed, and whether greater control of it will pass from the proposed new Atomic Energy Authority to the Central Electricity Generating Board.
  This is of great importance to the debate because the chairman of the CEGB, as I understand it, is more or less running around the country saying, "Please privatise us." That would have consequences for this Bill. To some extent, it would make nonsense of what the Minister had to say about safety and about the relationship between the CEGB and the Atomic Energy Authority.
  Returning to the composition of the authority's board, it should be seen as completely independent and free of pressure from commercial interests. Its commitment should be to the organisation and its objectives. That being so, part-time members who have a beneficial interest in organisations which have formal contractual arrangements with the authority should not be permitted to serve on the new board. I hope that the Minister will tell us today that the Government take the same view.
  224
  I referred earlier to another important aspect, the people who work for the Atomic Energy Authority. As they have told me, they undoubtedly feel that their jobs and their conditions of service would be at risk from commercialisation. When the United Kingdom Atomic Energy Authority was established in 1954 and when British Nuclear Fuels was hived off in 1971, employees were given a guarantee that their terms and conditions of service would be no worse than those of other civil servants.
  The 1953 White Paper even promised salaries
  "not seriously out of scale with those paid by other public corporations".
  That promise has certainly not been kept. Government pay policy has held salaries down, with the result that the authority is losing professional and scientific staff and is unable to recruit replacements. The people working for the authority need to be assured that their terms and conditions of employment are maintained. Salaries should be at a level at where staff of all grades can be recruited and retained. We need an assurance that the Department of Energy will not impose cash limits on the authority's wages and salaries bill which will cause an unjustified contraction of staffing levels. The staff must not be made sacrificial lambs on the Government's altar of commercialisation.
  Nuclear safety cannot and must not be jeopardised by the drive for commercialisation. The public is entitled to expect that the AEA's contribution to nuclear safety will not be compromised by the Government's preoccupation with commercialisation, or the new customer-contractor relationship between the authority and the CEGB. We need an absolute assurance from the Minister of that. He has a duty to outline the safeguards that are intended to ensure that nuclear safety will not suffer as a result of the Bill.
  The Minister's reply to some of my questions will determine our attitude to the Bill and its progress through the House. We do not intend to obstruct its Second Reading, but I give no commitment about what our attitude will be at future stages before the Bill leaves the House.
  6.1 pm
  Mr. Simon Coombs: I welcome in principle the creation of a trading fund arrangement for the Atomic Energy Authority. Indeed, many aspects of a public corporation are envisaged in the Bill. Obviously, I welcome the creation of genuine financial objectives—the introduction of the profit principle into the company's operations, and the opportunity which that gives to provide a disciplined and commercial approach to its customers.
  None of that in any way influences one in saying that the authority during the 31 years of its existence has enjoyed an outstanding record on research into nuclear power. Nevertheless, during those years there have been so many changes that it seems appropriate that the Government should have instituted an inquiry into the work of the authority, and advanced the proposals in the Bill. The changes have included hiving off what is now British Nuclear Fuels plc, and what was Radio Chemical Laboratories and is now Amersham International. Both became trading fund organisations, and Amersham International went one stage further along that well-trodden path and became a private company.
  When my hon. Friend the Minister replies, will he say something more about that in respect of the authority?

  225
  RCL went into the private sector as Amersham International, but BNFL has not. Clearly, what the Manley report said in private is of interest. I would not disagree with Opposition Members who suggest that the Government could have been a little less coy about the contents of the evidence that was not released. The summary of the report stated:
  "privatisation of the Authority as an entity, while possible in principle, is not in practice a realistic option at present."
  Conservative Members who in principle are in favour of privatisation feel entitled to ask why that was said, and why the Government are not prepared to consider the further development of the company into a private one.
  Mr. Evans: Will the hon. Gentleman concede that the Government have not published all the evidence because the arguments against privatisation were, obviously, compelling? If they had been in favour of privatisation, not only would the Government have produced the report, but they would have privatised the UKAEA.
  Mr. Coombs: The hon. Gentleman is entitled to guess the contents of the report, as I am. However, I seek the truth about the matter, and then we could discuss it. I should like the Minister to say something more about the subject when he replies. I seek to draw his attention to the authority's anomalous position in that it will operate in competitive markets in a halfway-house position which could make it difficult to compete with private companies.
  The Bill proposes a change in the funding for both the major reactor research programmes, although the fast reactor programme's change of funding is to come later. Either way, the extra cost will fall on the generating boards, and ultimately on their customers. That must have an effect on prices, however small, and it is important that the Government explain it clearly to the public. They should not simply say how the changes will affect prices, but should spell out positively the benefits that the public enjoy from a nuclear power programme which is properly researched by the authority.
  I wish to concentrate on two aspects of the authority's work inasmuch as they will be affected by the Bill—the research programme to improve the efficiency of nuclear power generation, and safety. In several respects we see the potential for improvements— in efficiency in the development of reactors, the improvement of fuel, and the recycling of fuel. All stand to benefit the generating boards, which will be major customers of the authority. Clearly, it is in their commercial interests to support these programmes in order to remain competitive, not only with other fuels in the United Kingdom, but in world markets for electricity generation.
  I shall give the House some examples. It has been estimated that a 5 per cent. improvement in the efficiency of the reactors of the present generation would yield £50 million per nuclear power station. It has been estimated that five years' additional life per reactor would be worth a total of £600 million. It is being estimated that a 10 per cent. improvement in the efficiency of fuel would generate £15 million per annum of additional income. When we consider the fuel recycling research programme we see that if the fast reactor programme is successfully introduced on a commercial basis, the recycling of plutonium and depleted uranium—that is the isotope known as uranium 238—could generate an improvement
  226
  that would be represented by the equivalent of one tonne of uranium 238 equalling 1·5 million tonnes of coal. Mathematicians in the House may care to consider the implications of that ratio. Clearly, the Government will benefit also because nuclear power must be a vital element in their overall fuel policy for the future, and it is important that the Government should demonstrate their commitment in that respect.
  Reference has already been made to underlying research—what I should like to refer to as "initiative" research—which involves knowing what the customer needs before he gets around to asking for it. Should the cost of that research be borne by the large customers of the authority, by those customers that it wins in a competitive environment, or by the Government? The answer seems to be a combination of all three, although I accept that the first is logical and that the third is inevitable, I ask the Government to think about the effect that increased overheads to fund the underlying or initiative research programme might have on the kind of bids that the authority would be in a position to make in a competitive environment.
  I should like to point out to the House, as if it needed to be reminded, that safety is of critical importance in the lives of us all. BNFL, the generating boards and the authority need sizeable investment in safety research, which of course is in the hands of the safety and reliability directorate within the authority. As a good employer and for the sake of public relations, it is important that the industry maintains the highest standards of safety and that it should be seen to be playing its part in achieving them. The Government are involved, particularly through the nuclear installations inspectorate, and I am pleased to note that £20 million has been earmarked for this purpose. We have to accept, whether we like it or not, that there is still a great deal of public concern and confusion, even fear, about the use of civil nuclear power. I think that the resistance that is borne of that confusion and fear is one of the prime reasons why the United Kingdom lags behind other countries in its nuclear capacity.
  A table published in October 1985 shows that in 1985 France was estimated to have generated 65 per cent. of its electricity from nuclear sources, Belgium 55 per cent., Taiwan 46 per cent., Bulgaria 29 per cent., the Federal Republic of Germany 25·5 per cent. and Japan 24 per cent. The United Kingdom is still well down the list at 20–5 per cent. That is a disappointing figure for the United Kingdom and one which I know the Government seek to have improved. It is unfortunate, to say the least, that the Sizewell B inquiry has been held up for so long, and one can only hope that the results will be published in the near future.
  People still say, "Yes, that is all very well, but what if something terrible were to happen?" Those of us who believe that the nuclear industry has an important part to play clearly have a public relations exercise to perform and that can be based only on the maintenance of the highest standards that the available technology of the day will allow. However, the public is entitled to an explanation that the advantages of nuclear power far outweigh the disadvantages. It is cheaper, and a brief prepared by the authority sets this point in context. It explains that a single bar electric fire consuming 1 kilowatt of energy can run on one pound of coal for one hour, on one pound of oil for one and a half hours, on one pound of uranium from

  227
  one of the present generation of reactors for two and a half years and on one pound of uranium from the fast breeder reactors of the future for 150 years.
  I invite the House to compare one pound of coal for one hour with one pound of uranium in a fast reactor for 150 years to see the value in terms of a reduced cost electricity supply. It is not only cheaper, but cleaner. Those of us who are concerned about the conservation of the environment and can see the problems of acid rain must surely appreciate that this is a power source which does not pollute the atmosphere, and the minimal risk associated with the nuclear industry—much as it is overplayed by some opponents—is a risk well worth taking for the benefits that will accrue.
  It is wrong to compare the military and civil uses of nuclear energy. Few people today have not benefited from radioactivity, especially in medicine. I hope that, for those reasons, the Government will be seen to support safety research up to the hilt.
  I welcome this Bill as a fresh beginning for the work of the authority. It might be appropriate to suggest not only a new start in commercial terms but even a new name, as the title "Atomic Energy Authority" smacks more of 1954 than of 1986. Something along the lines of "British Nuclear Research" would emphasise the modern tasks that we ask the authority to undertake, and might be more appropriate for its future development. Under whichever name, the quality of the work done by all the staff of the authority ensures that it will have a healthy future—no doubt, aided and abetted by the Bill.
  6.16 pm
  Mr. Ian Wrigglesworth: The hon. Member for Swindon (Mr. Coombs) has, I think, illustrated the importance of this measure and the nuclear industry. The House will be grateful to him for that.
  I have two immediate constituency interests in this industry. The first arises from the fact that we have contractors and designers of nuclear installations, and the second from the fact that over the last couple of years there has been the proposal for dumping nuclear waste at Billingham. That was the other side of the coin. Thankfully, that threat has now gone away, but it illustrated to the people of our area the difficulties as well as the benefits that flow from this industry.
  I begin by joining other hon. Members in paying tribute to the work of the United Kingdom Atomic Energy Authority. It has a good reputation for great professionalism, and it has made a major contribution over the years. In this controversial matter it has managed to maintain that reputation for professionalism throughout, and I think that we should all pay tribute to it for that. We support the Government's proposal for the establishment of a trading fund for the authority, but, having said that, I want to make it clear that we should strongly oppose any suggestion, such as that made by the hon. Member for Swindon, that it should at some future stage be privatised.
  A case can be made for a trading fund, because it brings with it the right combination of commercial behaviour, customer and public responsiveness and accountability. On those grounds, the Bill's proposals and the development of the authority as a trading fund will help to make the authority's activities more efficient. The Bill will make it responsive to commercial and public pressures, and accountable to the public. We welcome the proposals and will support them in their passage through
  228
  the House, but because of the authority's strategic nature and the degree of public concern about the industry, we should reject the idea of privatisation.
  I should like to refer to public concern about the nuclear industry, which is a combination of confusion, fear and genuine misunderstanding of the dangers. It is often difficult to disentangle those different attitudes. There is no doubt— the United States illustrates this In the clearest way—that public concern is an important factor in the industry's future.
  As the hon. Member for Swindon said, it is vital that the authority's work on nuclear safety, especially nuclear waste research, is maintained and supported by the Government. Until we have lanced this boil of the dispersal of nuclear waste, it will, understandably and rightly, continue to act as a brake on the industry's development. I urge the Department of the Environment to proceed apace with the Department of Energy and the other bodies involved to come up with firm proposals and carry them through as speedily as possible, taking public opinion with them as far as possible. This will bring about progress in the industry and will mean that people will rot be worried—as they are in the United States—to such an extent that a major brake is applied to developments.
  The Bill proposes to establish a new financial structure for the authority. This consists of the financing of capital debt and loans given by the Government through the Public Works Loan Board to provide a commercial structure for the financing of the body. This imposes a rather rigid requirement. Will the Under-Secretary of State consider the proposition that was made in another place that part of the capital should consist of public dividend capital? This would provide flexibility and greater freedom for the management than would a loan.
  Will the Under-Secretary of State consider also the proposal that was made in the other place to widen the scope of the authority's activities to include other aspects of energy research and promotion of new fuels and power sources? It is difficult to distinguish between the different sources of energy and different fuels. There is a tremendous overlap in energy research. We believe that this is an aspect, especially on the conservation side, where the authority's expertise could make a major contribution that would help the Government and. the whole country.
  Another aspect of concern is consultation with staff— both those in trade unions and those who are not unionised. The change over seems to provide an opportunity for management to draw staff into the fullest possible consultations on the authority's activities. I should be grateful if the Minister would comment on the proposal to ensure that that consultation occurs.
  There is a widespread feeling that in the past the authority and the Department of Energy have been more reticent than they might have been in publishing information. One reason why so many fears abound is that there is not as much openness in Britain as there often is in other countries. Inevitably this leads to suspicion and lack of trust when information on developments in the industry comes from the publication of the facts and details in other countries rather than from the authority and the Department. I appeal to Ministers to ensure that the authority is as open as possible—as open as security or, more likely, commercial reasons, allow—in publishing information and giving as much information about their activities as they can.

  229
  I hope that the Under-Secretary of State will comment on those points. We look forward to considering the Bill in Committee, when we can test these matters in more detail with amendments.
  6.24 pm
  Mr. Robert Jackson: A substantial proportion of the 14,000 staff of the United Kingdom Atomic Energy Authority live and work in my constituency at Harwell and Culham, and on their behalf I welcome the Bill. For them, it constitutes a challenge and an opportunity. The challenge is to prove the cost-effectiveness of their work in a more competitive and commercial trading environment. The opportunity is to take advantage of the loosening of the bonds of Treasury control that the Bill represents.
  The best way to look at the Bill is to see it in its historical perspective. Like all dynamic institutions, the authority is in a process of continuing evolution, and the Bill marks an important—but not a final—stage. My hon. Friend the Under-Secretary of State referred to a number of landmark dates— the establishment of the authority in 1954, confined simply to nuclear research and financed exclusively by the Government; the broadening out into non-nuclear research areas after 1965; the hiving-off in 1971 of some of the authority's commercially successful developments; and the removal of weapons work in 1973.
  The Bill is a further stage in this evolution. It reinforces the trend to broaden the financial basis of the authority's work from the Department of Energy to the nuclear industry as a whole. It strengthens the trend to research and development in the authority on a customer-contractor basis. It builds on the experience and management capability that has been developed in the authorities over the past 30 years to enable it to operate more commercially, to carry forward its surpluses and deficits from year to year, and to borrow subject to an overall limit.
  I dwell particularly on the evolutionary character of these developments because, at the time of the commissioning of the Manley report, there was a great deal of speculation about the possibility of radical changes in the authority. We detected some echoes of this in the speech of the hon. Member for Midlothian (Mr. Eadie). I am pleased, but not surprised, at the vote of confidence that the Manley report appears to have given to the authority, and at the confidence in the authority which the Government show in the Bill.
  Having welcomed the Bill, I shall make three points about it. First, I hope that the Government will not lose sight of its fundamental purpose— to enable the authority to maintain and improve its work in developing and transferring technology to industry. I understand that the authority is not dissatisfied with the proposed financial starting arrangements, for the capital base and for the proposed return on capital. So I hope that we shall not have in Committee the discussions that occurred in another place on that point.
  But I believe that these financial arrangements must—I am sure that they will—be kept under review so that, as the authority, the Government and the authority's customers gain experience of the operation of the trading fund, these financial arrangements will not get in the way
  230
  of the rational progress of the organisation and its work. The same may be said of the range of responsibilities conferred on the authority by this and previous legislation. This was also the subject of a proposed amendment in another place, but I do not believe that a change is necessary and I am glad that the hon. Member for Midlothian did not press the point in his speech. I understand that the authority is confident that it can operate successfully within the present broad limits of its responsibilities, but, as with the financial arrangements, I think that this matter should be kept under review so that, after the new trading fund comes into operation, it does not find that it is inhibited in pursuing commercially viable research and development opportunities.
  My second point concerns the authority's underlying research programme, much of which takes place at Harwell. I do not share the scepticism of my hon. Friend the Member for Swindon (Mr. Coombs) about this work. It costs £20 million plus a year, and of course this is a time of excessive financial constraint in resources for science.
  I should like to draw the Minister's attention to the early-day motion on the "Save British Science" campaign now before the House. Consequently the authority's research budget has attracted the beady eyes of other scientists. But I was privileged to take part in what I believe was the first ever visitation of Harwell and Culham by the Advisory Board on Research Councils in 1983, and all the grand panjandrums there assembled were, I am glad to say, impressed by what they saw. I understand that negotiations about the proposed levy to finance the authority's underlying research are virtually completed. I hope that BNFL and the CEGB, as well as the Department of Energy, will show the right support for this work.
  Thirdly I wish to focus on the position of the authority's staff, many of whom are my constituents. I support the idea of employee participation mentioned by the hon. Member for Stockton, South (Mr. Wrigglesworth) and I think that the authority will stay in the vanguard of progressive employers in that regard. But I think that it is dangerous to overload the new trading fund with additional requirements just as it is getting off to a delicate start.
  On the other hand, I believe that the hon. Member for Midlothian is right about the important issue of pay and conditions. I see problems emerging, especially in the ability of the authority to "recruit, retain and motivate" staff of the right calibre. I can testify to the fact that motivation is high; but the ability to retain good staff is declining. Over the past two years there has been a sharp increase in the quit rate at the Atomic Energy Authority, and it has doubled at Harwell over the past two years, expecially among the younger staff and notably in computing and electronics. The difficulty of retaining staff spills over into recruitment, because there is a loss of the skilled and experienced staff required to train recruits who are often taken in with inadequate training from the schools or universities.
  I welcome "supplementary payments" as a way of addressing this problem, but they cannot be extended and multiplied indefinitely. I am pleased to say the they are not yet the subject of resentment within the authority—but they could become so. There is also a danger that we shall end up with a byzantine pay structure. More important is the introduction of unified grading. This will end the existing pay discrimination between administrative, professional, technical and scientific grades.

  231
  I was pleased to be able to give some parliamentary support to that work, but I am disappointed about what appears to be the long lead time that is being envisaged for the introduction of unified grading. I understand that four years is envisaged for engineers and five years for the scientists and scientific officers. I think that this is too long, and I hope that the Government will attempt to shorten that time.
  The Bill and the whole concept of a trading fund challenge all those who work in the Atomic Energy Authority to take full advantage of the greater freedom they will have to operate commercially. In due course, this new freedom is bound to raise the question of the costs and benefits to the authority and its employees of the long-established link between authority and Civil Service pay and conditions. That link has no statutory basis. It is a matter of custom and practice, and I believe that there may be advantages for all concerned if the link were to be phased out. That could offer greater flexibility to management and the prospect of greater reward for the staff. Of course we must enter the caveat that, in a commercial situation, salaries can fall as well as rise in value.
  The main point is that in a commercial situation closer links can be established between performance and reward. That is what the Bill and the trading fund it establishes are all about.
  6.35 pm
  Mr. John Evans: I express sceptical neutrality about the Bill. Two miles from my home in the village of Culcheth sits the headquarters of the United Kingdom Atomic Energy Authority and, together with the headquarters of BNFL, there are thousands of people employed in the industry who work on that site, including my son. The headquarters was in my constituency for 10 years, until parliamentary redistribution. Although it is no longer in my constituency, many hundreds of my constituents work at the Atomic Energy Authority. I frequently meet the workers—manual, non-manual, scientific and others—at the Daten social club in the village, and it is fair to say that the view of the work force at all levels in Culcheth and Risley is one of sceptical neutrality.
  There is some pleasure at the fact that the authority is not being privatised, although there is some bewilderment as to why the Manley report was not published in full. I raised that matter in an intervention with the Minister. I think the main reason the report was not published was that the Government decided that it was not in their interest to publish it because the arguments against privatisation were strong, if not overwhelming. It would probably have given us ammunition to use against other privatisation measures.
  It is a pity that the report has not been published. The people who work in the industry are upset that it has not been published, because non-publication precludes a full and proper debate in Parliament and in the country about not only the future of the authority but the future of nuclear power. That is a pity, because one of the reasons for the declining support in the concept of nuclear power is the inordinate secrecy and bureaucracy that surrounds the industry. It is no good the Minister shaking his head. I have met that time after time, not only under this Government but under my own. I shall be even-handed in my criticism of the Department of Energy and not merely make a party political point.
  232
  The excessive use of the Official Secrets Act 1911 bedevils the industry. There will be no change in that respect. All the employees of the industry will still be covered by that Act but the nuclear power industry requires more openness and less secrecy. The hon. Member for Penrith and The Border (Mr. Maclean) asked my hon. Friend the Member for Midlothian (Mr. Eadie) about the debate and vote at the Labour party conference. He seemed to want to make a debating point. He should be as concerned about the vote as I was because many unions which have always voted in favour of nuclear power are moving away from it. That is to be deplored. The reason for the shift in attitudes should concern us all, because there is a growing fear about the future use of nuclear power in the country.
  The hon. Member for Stockton, South (Mr. Wrigglesworth) described the proposal to bury nuclear waste in Billingham as a threat. He did not tell us why it was a threat. It is that sort of fear which people are beginning to express, and on which they are not receiving answers that is damaging public support for nuclear power.
  Many issues could be raised on the Bill. It is a tragedy that the House rarely debates nuclear power. The last major debate in which I took part was in 1974 when we debated the choice of a nuclear reactor. We have not debated the issue from that day to this. It cannot be said that the House bores itself or involves itself heavily in a subject that is of great concern to all our constituents.
  I am concerned about the fact that the Bill will reduce parliamentary scrutiny. I am worried about clause 7 for I suspect that we shall lose the power of parliamentary scrutiny in other areas. That is likely to happen at a time when there should be much more parliamentary scrutiny of the activities of the nuclear power industry.
  I am concerned about clause 6, which appears to give enormous powers to the Secretary of State to direct the new authority. I am not sure whether the actions of the Secretary of State will be subject to parliamentary scrutiny, but perhaps the Minister will tell us when he replies. The clause will strengthen the Secretary of State's powers and weaken Parliament's.
  The Minister has told us that there will be an annually agreed programme letter between the authority—presumably its contractors—and the Department of Energy. I hope that the Minister will tell us whether Parliament will get a glimpse of the letter. Parliament and the people are entitled to know the contents of such documents.
  Will the Bill clear up the doubt and uncertainty that has bedevilled the nuclear power industry for so many years? I suggest that the industry has been clouded and bedevilled with doubt since the 1960s, when the initial AGR programme was first agreed. Since then we have had nothing but twists and turns. There have been a succession of Secretaries of State under different Governments but no Secretary of State has cleared up the doubts and uncertainties about the industry.
  We are nowhere near the integrated energy policy that we used to talk about 20 or 25 years ago. In that context, I suggest that the Bill represents a lost opportunity of considerable proportions. It could have formed a key role in the creation of a new energy authority that would have led to an integrated energy policy. Surely that would have been better for the nation and the people. It would be far better to establish an energy authority which would move

  233
  towards the introduction of an integrated fuel policy than to continue the piecemeal methods that have been adopted so far, which include privatising British Gas, crucifying the coal industry over the past two or three years, leaving the North sea depletion rate to market forces and the measure that is before us, which will establish a hybrid organisation for the Atomic Energy Authority.
  If we were prepared to move towards such an energy authority, the UKAEA would have tremendous responsibility in the light of its expertise in so many areas, apart from those that relate directly to nuclear power. It has the ability and the skilled scientific and engineering forces to allow it to develop new techniques in biofuels and wave power. A new area could be opened up to us if we approached these matters with some imagination rather than what appear to be excuses on the part of Department of Energy Ministers due to their inability to privatise the authority.
  If we moved down that track, we would be able to kill a notion which has developed over the past three or four years, which is that the Government are determined to increase the capacity of the nuclear power industry so that the coal industry can be wound down. The Minister will probably deny that that is the Government's intention, and he will probably be right to do so, but he cannot deny that the feeling which I have described has grown considerably over the past few years. It was seen as an additional reason for the resolution which was agreed to at last year's Labour party conference. There is a feeling that nuclear power will be used by the Conservative Government to help further to run down the coal industry. That is not true, and it has never been true, for there is a great future for coal, but the future of the coal industry would be better served if there were a clearer understanding among the public of the part that nuclear power will have to play in our energy policy.
  It is essential that the research and development capability of the authority is not hindered in any way. It must be accepted that R and D is extremely expensive and that it rarely results in a return of capital, but I trust that there will be no suggestion that the vital research and development that goes on within the authority will not be diminished by any reduction of the funds that are made available to it by the Department. Such a reduction would be a disaster for the authority and a further nail in the coffin of public confidence in the industry.
  The disposal of nuclear waste is paramount in the minds of many. Various methods have been used in the past—dumping at sea, storage tanks and burying within dry land sites—but they are proving increasingly unacceptable to many people. It is all very well to talk about foreign countries and the percentage share of nuclear power of their energy industries, but the evidence is that the populations of other countries are becoming increasingly concerned about waste disposal. There must be further massive research into disposal. We shall not solve the problem by trying to find a few more dry land sites where the waste can be buried, unless we can find a desert somewhere which is population-free.
  For far too long the work force of the authority has been subject to the whims of various departmental decisions, and often to the whims of the authority's board and the decisions that it has made. It is essential that the wages, terms and conditions of service and job security of the
  234
  employees, both manual and non-manual, are safeguarded. I trust that the proposed new format for the authority will not initiate a rush to privatisation methods that will lead to putting all the cleaning staff, canteen staff and maintenance staff out to private contractors, who will pay lower wages and offer inferior conditions.
  I should be grateful if the Minister would say something about those who have no great skills and no degrees as well as those who are highly qualified scientists, or others who work at the highest levels within the authority. We must realise that the lifestyle and the quality of life of those with lesser skills and qualifications depend on their employment, and continued employment, within the authority.
  If the Bill is suitably amended, I suspect that it will prove to provide a new dawn for the authority. Handled correctly—I doubt very much whether it will be—it could mark a new beginning. The authority needs a new beginning, because for too long it has been stifled. I hope that it will enjoy one, but I rather suspect—I hope that I am proved wrong—that the Bill is the first step in what the Government hope will be a successful march to privatisation once they have the measure on the statute book.
  6.48 pm
  Mr. David Maclean: Civil nuclear power has become an essential and established part of Britain's energy requirements. By 1984, more than 18 per cent. of electricity supplied in the United Kingdom came from a nuclear source. Jobs in the United Kingdom nuclear industry—I use the term in its widest sense—total about 100,000. I make no apology to the hon. Member for St. Helen's, North (Mr. Evans) for introducing a political note when I questioned the hon. Member for Midlothian (Mr. Eadie). It is ironic that they should question some of the minutiae of the Bill and the detailed terms and conditions of employment for the Atomic Energy Authority's staff.
  If the motion passed by an overwhelming majority six months ago at the Labour party conference takes effect, we shall have no nuclear power programme. All nuclear plants will be phased out. That is a political fact and I make no apologies for mentioning it. There would certainly be no concerns about the details of safety as there would be no nuclear power.
  When the hon. Member for Stockton, South (Mr. Wrigglesworth) says that we will not divide the House and we will monitor the progress of the Bill, he should make it clear whether that "we" refers to the Social Democratic party or to the whole of the alliance. As I understand it, the Liberal party policy is to phase out nuclear power and have fluidised bed systems.
  The hon. Member for St. Helen's, North (Mr. Evans) is correct when he says that there have been doubts and uncertainties for many years under all Governments. These doubts and uncertainties are not fuelled by Conservative Members who believe in nuclear power and how essential that is. It is fuelled by the doubts expressed by Opposition parties and their intrinsic hostility to nuclear energy.
  The proportion of nuclear electricity in this country will exceed 18 per cent. and reach 21 per cent. when the three new nuclear power stations most recently linked to the national grid reach full power. There will be a further increase to 25 per cent. when stations now under construction are completed.

  235
  All of that has been achieved within an excellent record on nuclear power so why is there a need for a change? There are sound commercial advantages to the Bill. The move towards a more commercial style of management will offer the industry greater opportunities both for its own development and for the work it undertakes. The plan contained in the Bill will mean that cash surpluses earned by the authority will be invested in the future of the organisation's business. The main sphere of the authority's work will continue to be research and the support of the United Kingdom nuclear power programme, and it will also continue to act as the main adviser to Government.
  A balanced energy strategy for the United Kingdom must take full account of the need for diverse fuel supplies, and that is crucial in view of the events of the past two years. We all know that it would be unwise to base Britain's electricity generation upon a single fuel. At the moment the United Kingdom electricity system is dominated by coal-fired generators. Under such circumstances there is a definite need and an important role for a cost-effective nuclear component. Nuclear power, as we all know, offers a safe, clean, cheap and secure source of electricity. Most major electricity utilities in the world have decided that nuclear technology is the most cost-effective means of meeting future generation needs.
  Nuclear research and development will become increasingly important as the world energy market expands and as nuclear power will not be the only possible solution to energy needs. Therefore, it is essential that the United Kingdom Atomic Energy Authority is at the forefront of any progress made in that important scientific field.
  That brings me to several important questions which I hope my hon. Friend, the Parliamentary Under-Secretary of State for Energy will consider in his summing up. These questions relate to Dounreay. I have a personal interest in Dounreay as I have family in that part of the world. I also have a constituency interest as I believe that most of the fuel moved between Sellafield and Dounreay may be transported through my constituency.
  The fast reactor and the fuel cycle project are vital to this country. I believe that £100 million worth of business is tied up in that research project. Britain is at the forefront of that technology although, as one wag said at the nuclear forum I attended recently, we ought not to be in the forefront, we should be second and therefore do it better. That is why the Americans are so successful.
  My particular questions concerning Dounreay are as follows. Can my hon. Friend confirm that the project will be an integrated European collaborative project or is there any possibility that the United Kingdom may try to go it alone?
  Will my hon. Friend comment on people's worries about discharges into the Pentland firth? Will the discharges be as low as at Sellafield, or will they be as low as they will be at Sellafield? My hon. Friend will know that millions of pounds are being spent at the reprocessing plant at Sellafield on drastically reducing discharges into the Solway firth and the Irish sea.
  Will my hon. Friend comment on the transport of nuclear fuel? Will there be any substantial changes to transport arrangements, whether by land, sea or air which already exist between Dounreay and Sellafield and which have worked most effectively without any hazard for the past 30 years?
  The Dounreay project is very important to Britain. I hope my hon. Friend will deal with these questions and
  236
  that he thinks it appropriate to deal with them in relation to the Bill. I hope that my hon. Friend can allay some of these worries which are causing unnecessary anxiety locally. If he manages to do that then both sides of the House should welcome this admirable Bill.
  6.58 pm
  Mr. Eadie: I had thought that the Minister was going to reply first. I wanted to hear his answers to the points that have already been raised.
  Some Conservative Members seem to act in the spirit of the best anti-nuclear lobby in this country. I agree with my hon. Friend the Member for St. Helens, North (Mr. Evans) that those Conservative Members would frighten the people of this country to death when they start to talk about privatisation and passing over research and development and technology into the hands of private industry.
  It is wrong to say that people are not concerned about the effluent associated with nuclear power stations. One is living in cloud cuckoo land if one imagines that there is a great enthusiasm on the people's part about nuclear power and that they are not concerned about the hazards and dangers of nuclear power.
  The United Kingdom Atomic Energy Authority has been doing a lot of research and development work. People have some confidence in that organisation because of its record, but then Conservative Members say that we should consider passing the whole thing to private enterprise. At least the Minister did not say that but it is important that he makes some comment on that.
  Of course there should have been some discussion in the Bill about the non-nuclear research aspect of the activities of the authority. The whole question and philosophy of research and development, the idea that one can have research and development on the cheap, that one can forecast the developments that will arise and that they will be cheap, and the philosophy that one can always back winners is wrong, because if one always backs winners there will be no research and development. The purpose of research and development is to make discoveries. Sometimes there are disappointments and work and research must commence again.
  As my hon. Friends have said, there is a good opportunity to change the whole direction of the authority in the Bill. There may be an opportunity in Committee to improve the Bill. We may have the chance to lay to rest for ever the ghost of privatisation and give the enthusiasm which the hon. Member for Wantage (Mr. Jackson) mentioned through the authorities to the people who work there. I must say that I have not seen that great enthusiasm in the people that I met.
  6.59 pm
  Mr. Goodlad: I should like to take up the more important points raised in this helpful debate. Hon. Members have mentioned the publication of the Manley report. As the hon. Member for Midlothian (Mr. Eadie) will know from his very distinguished term of office in Room 1255 at the Department of Energy, it is not normal practice to publish confidential advice to Ministers. The conclusions and recommendations of the report are summarised fully in the press notice issued by the Department of Energy on 3 October 1984, a copy of which

  237
  was placed in the Library of the House. We should not have been able to have such a full, interesting and helpful debate today without that report.
  The hon. Member for St. Helens, North (Mr. Evans) mentioned the ghost of privatisation and asked me about the significance of clause 3(3) of the Bill which gives the Secretary of State power to reduce the authority's borrowing limit if a body ceases to be a wholly owned subsidiary of the authority. That does not have the sinister intent that the hon. Gentleman may imagine. As he can see from clause 3(1), the borrowings of any wholly owned subsidiary of the authority count towards the borrowing limit but those of any body in which the Atomic Energy Authority has less than a 100 per cent. stake do not, unless the borrowing is guaranteed. That is in line with general nationalised industry practice.
  The authority has no wholly owned subsidiaries at present, but if, for the sake of argument, one was set up to exploit a nuclear invention and it was decided that some private venture capital should be introduced to help the development and to aid the transfer of technology, the company would cease to be a wholly owned subsidiary of the authority and under clause 3(1) the borrowings of such a company would cease to count against the borrowing limit, even though the authority remained a shareholder. The Secretary of State might then wish to reduce the authority's borrowing limit by an amending order.
  With regard to the chairmanship, the Secretary of State is concerned to ensure that the best possible person is appointed to succeed Mr. Allen. The role of the chairman is important, especially in view of the changes being made in the authority's operations. The urgency of the matter is fully recognised and I expect my right hon. Friend the Secretary of State to make an announcement shortly, certainly before the start of the trading fund.
  The hon. Member for Midlothian mentioned the authority's fusion activities which started during his tenure of office as a Minister. He also referred to the JET project. The Government remain committed to that project. As I said in my statement early last year, a substantial programme will be maintained at the authority's own laboratory at Culham.
  On pay and conditions for all staff employed by the authority, I agree that these must be sufficient to enable the authority to recruit and retain staff. The contract of employment for non-industrial employees includes a provision that pay and conditions should be no less favourable than those for analogous grades in the Civil Service, due allowance being made for factors peculiar to the authority. It would not be for the Government to suggest any change in those arrangements. They are a matter for the authority and its staff side. I assure hon. Members, however, that the Department has no intention of imposing specific cash limits on the authority's salaries and wages bill.
  Nuclear safety, as I said in opening the debate, is of the utmost importance and it will in no way be adversely affected by the move to a trading fund. The British nuclear industry has an excellent safety record—more than a quarter of a century of safe, civil nuclear power. In no other industry, I believe, has so much time and money been devoted to safety, and rightly so. We expect the authority to continue its contribution to maintaining high standards of nuclear safety in this country. The
  238
  Government attach importance to the authority's independent capability in this area and we expect to fund some £20 million of safety-related research and development by the authority in 1986–87.
  With regard to the 5 per cent. return and its relationship with the commencing date, I confirm that we expect the commencing capital debt to be about £80 million. Servicing a debt of that size and the additional working capital required for the trading fund could cost the authority some £10 million per year, depending on interest rates. The financial target of a 5 per cent. return on current cost capital employed at £250 million would be achieved if the authority could declare a profit of about £12·5 million before interest: it is in no sense a surcharge on the authority. It is merely a target profit out of which the authority will pay interest on its debts.
  The hon. Member for Midlothian and the hon. Member for Stockton South (Mr. Wrigglesworth) and others mentioned consultation on plans and programmes. The consultation arrangements are based on the joint bodies—the authority Whitley council for non-industrial employees and the National Joint Industrial Council for industrial employees. These bodies consider and discuss annually reports on the authority's present and future programmes and take regular reports on programme developments and plans at each establishment. The authority does not expect the operation of the trading fund to require any major changes to its procedures for consultation and negotiation with the staff and trade union sides.
  The new corporate planning procedures associated with the trading fund will require a new approach and the authority recently put detailed proposals to the staff and trade union sides. These allow for discussion of the authority's annual medium-term corporate plan, which sets out detailed business plans for the next five years, and for a staff and trade union side input into the authority's strategic review, to be carried out every other year starting this year, which will determine a broad strategic framework for 10 years ahead.
  The hon. Member for Midlothian mentioned management for the fast reactor programme. I assure him that the change to a trading fund will in no way affect the management of that crucial programme. The hon. Gentleman also mentioned the fast reactor reprocessing application, as did my hon. Friend the Member for Penrith and The Border (Mr. Maclean). I cannot comment on the merits of the specific proposal, which will be the subject of the public inquiry starting in April. Hon. Members may recall, however, the open letter which my right hon. Friend the Secretary of State wrote to the chairman of the authority on 21 May last year, in which he said that the Government considers that the fast reactor, which is 50 times more efficient in the use of uranium than thermal reactors, will be of major strategic significance for the United Kingdom and the world's future energy supplies. The United Kingdom is among world leaders in this technology as a result of the successful research and development programme undertaken by the Atomic Energy Authority at Dounreay.
  The Government also recognise that substantial resources are needed to achieve commercialisation and that some international sharing of the cost is desirable. Since January 1984, the United Kingdom has been involved in research and development collaboration in Europe. To achieve the fast reactor's full potential,

  239
  commercial demonstration is required not only of the reactor but also of the fuel cycle. A demonstration reprocessing plant will therefore be needed. The United Kingdom is a strong contender for that plant and the Government see advantages in siting it in this country subject to the necessary planning, safety and environmental consents being granted. This will enable BNFL and the AEA to build on their long experience in this sphere. It will also provide job opportunities during construction and operation and potentially in the longer term.
  My hon. Friend the Member for Penrith and The Border referred to safety. The safety of nuclear materials in transit is a matter for the Department of Transport, but in general safety is inherent in the package design and does not depend for its effectiveness on the method of transport or on routeing considerations. My hon. Friend also referred to discharges. The AEA and BNFL have said in their planning applications that the quantities and activity levels of liquid discharges from Dounreay will not increase as a result of the construction and operation of the proposed plant. Discharges from the permitted establishment at Dounreay are less than 10 per cent. of existing authorised levels.
  The hon. Member for Stockton, South and my hon. Friend the Member for Wantage (Mr. Jackson) raised the question of public dividend capital. The AEA does not meet the Government's usual criteria for public dividend capital, which is normally available only to public sector bodies subject to considerable fluctuations in returns due to their trading conditions and the nature of their assets—for example, British Shipbuilders. That is not the case with the AEA.
  The hon. Member for Midlothian and the hon. Member for St. Helens, North (Mr. Evans) referred to radioactive waste. The Government will continue to ensure that all necessary steps are taken for the safe management of the radioactive waste which already exists and that which may be created in future. The authority carries out extensive research and development programmes on the management of radioactive waste and other nuclear materials and I do not expect the United Kingdom nuclear programme to be affected by inadequate research in that area.
  The hon. Member for Stockton, South mentioned extending the authority's remit to other power and fuel sources. Under the Science and Technology Act 1965 the Secretary of State already has power to require the authority to undertake research and development in specific non-nuclear areas, which could include the production of fuels and power sources. Indeed, a requirement dating back as far as April 1974 already enables the authority
  "to undertake scientific research into the provision, distribution and use of energy resources and associated technology".
  A number of hon. Members asked how much money the underlying research levy would produce, whether it is enough for an adequate programme and whether it will affect the authority's competitive condition. The Department of Energy will be contributing more than £16 million in 1986–87 by a 10 per cent. levy on the nuclear research and development done under programme letters. With contributions from other customers, this should provide funds for an underlying research programme of about £25 million overall, which would be similar in size to the authority's present programme. I do not believe that these arrangements will have a significant effect on the authority's competitive position.
  240
  The hon. Member for St. Helens, North suggested that we should change the authority into an energy authority. We have no such plans. The authority review concluded that there was a continuing need in the United Kingdom for a body of expertise like the authority's. The authority's raison d'etre is high quality research and development. Its expertise has widened over the years since the Science and Technology Act 1965. It now covers many non-nuclear
  areas as well. We see no case for changing the role of the authority into that of an energy authority to run an integrated energy policy for the United Kingdom.
  The aims of the Government's energy policy are clear. There should be adequate and secure supplies of energy available and the supplies should be available in the forms that consumers want at the lowest practical long-term cost. The Government believe that those aims are best secured not by requiring the supply industries to follow an inflexible centrally imposed blueprint, but by responsiveness to market forces.
  I have tried to answer briefly the main points raised by hon. Members. If there are any points that I have missed, I shall endeavour to write to my hon. Friends, who have made knowledgeable speeches, before the Committee stage. I am conscious of the fact that we are trespassing on the time of the next debate.
  I remind the House that the purpose of the Bill is to place the authority on a trading fund basis from 1 April, with a revised capital structure and powers to borrow. We believe that that will encourage a more commercial approach and greater efficiency while preserving the key role of the authority as an independent United Kingdom source of high quality nuclear research and development. I commend the Bill to the House.
  Question put and agreed to.
  Bill accordingly read a Second time, and committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).

  Atomic Energy Authority Bill [Lords]

    ATOMIC ENERGY AUTHORITY BILL [LORDS] [MONEY]
    Queen's Recommendation having been signified—
    Resolved,
    That, for the purposes of any Act resulting from the Atomic Energy Authority Bill [Lords], it is expedient to authorise—
    (1) the payment out of the National Loans Fund of any sums required to enable the Secretary of State to make loans to the United Kingdom Atomic Energy Authority ("the Authority"), subject to the limit that the aggregate amount outstanding in respect of—
    (a) money borrowed—

    (i) by the Authority or a wholly owned subsidiary of theirs, or

    (ii) for the repayment of which the Authority or a wholly owned subsidiary of theirs is a guarantor or surety

    other than money borrowed from a wholly owned subsidiary or from the Authority,
    (b) the Authority's commencing capital debt, and (c) sums issued by the Treasury in fulfilment of guarantees of borrowing by the Authority or their subsidiaries,
    shall not exceed £150 million or such greater sum not exceeding £200 million as the Secretary of State may specify by order;
    (2) the payment out of the Consolidated Fund of any sums required to fulfil guarantees given by the Treasury in respect of sums borrowed by the Authority or their subsidiaries;
    (3) the payment of sums into the National Loans Fund or Consolidated Fund.—[Durant.]

  Drug Trafficking Offences Bill
  Order for Second Reading read.
  7.12 pm
  The Secretary of State for the Home Department (Mr. Douglas Hurd): I beg to move, That the Bill be now read a Second time.
  This Bill offers us a sharp new weapon in the fight against drugs. Before I outline the thrust of the Bill and the advantages which we think that it will bring, I would like to say a few words about how it fits into our general strategy.
  Because drugs can degrade and destroy human beings in the most pitiless way, there is no strand of public policy more important than the fight against drugs. Our strategy is effectively overseen and co-ordinated by the interdepartmental ministerial group on the misuse of drugs, chaired by my hon. Friend the Under-Secretary of State for the Home Department. It is doing an admirable job.
  We have to tackle both supply and demand. Last year we stepped up action on both fronts. On the supply side, the key tasks are international co-operation, effective enforcement and deterrence. The United Kingdom has for many years worked energetically with others to reduce supplies of drugs from abroad. Last October, we announced further grants to help to reduce drug production and trafficking. They were directed particularly at opium poppy cultivation in Pakistan and cocaine production in Latin America. Both customs and the police are targeting substantially increased resources on the drug traffickers. For example, the number of customs specialist investigators has more than doubled since 1979 and is set to increase again. The appointment of a national drugs intelligence co-ordinator, Mr. Colin Hewett, has further enhanced the co-operation between the two services. Our determination to strengthen deterrence is exemplified in the Bill.
  On the demand side, up to £8 million has been set aside for our continuing successful national prevention compaigns, which include television advertising, posters, leaflets for parents, videos for professionals and young people, and action in the schools. Extra resources have been provided to expand treatment and rehabilitation services for drug misusers, including a further £5 million a year through the health authorities from April.
  It is fair to claim that this strategy is producing results. In 1985 customs seized a record £107 million-worth of drugs and smashed more than 70 drug rings. Police seizures have also risen rapidly, and so have convictions for trafficking offences. An independent evaluation of our prevention publicity suggests that it has made young people more aware of the harmful effects of drugs, such as heroin, and has stiffened their resolve to say no to drugs.
  Those are clearly encouraging signs, but the situation remains serious. I would be quite wrong if I did not warn the House that the drugs problem in the United Kingdom could continue for a while to get worse before it gets better. The world is awash with drugs, and we may see an increase in the number of traffickers and misusers. We can reasonably expect price and purity levels to remain fairly static. The number of seizures and arrests are likely to increase as the efforts and effectiveness of the police and customs continue to improve.
  242
  Heroin will continue to be our main problem, and there are signs that as Pakistan has more success in cracking down on the traffickers, so the source for smuggling heroin into the United Kingdom shifts to its neighbours in south-west Asia. The cocaine explosion which has been forecast by some commentators has not materialised, but we need to remain especially alert in view of the massive quantities that are being produced in Latin America. We should also worry about the scale of illegal manufacture and import of amphetamines, which are widely available to youngsters on the streets at affordable prices. Fortunately the "designer" and synthetic drugs which have appeared in the United States of America are still almost unknown in the United Kingdom, although LSD is becoming more common.
  The Bill fits firmly into our strategy. By attacking the profits made from drug trafficking, we intend to make it much less attractive to enter the trade. We intend to help guard against the possibility that the profits from one trafficking operation will be used to finance others, and, not least, to remove the sense of injury which ordinary people are bound to feel at the idea of traffickers, who may have ruined the lives of children, having the benefit of the profits that they have made from doing so.
  Those matters are urgent and imperative—and they stand at the top of our list of legislative priorities. Accordingly, the Bill deals only with drug trafficking offences and not with other profitable types of crime. There is, of course, a case for making corresponding provisions for other sorts of crime. Several hon. Members have already suggested to me that this Bill should do so. The 1984 report of the Howard League committee, chaired by Mr. Justice Hodgson, to which we are indebted for many of the ideas in the Bill, made recommendations —most of which it believed should be generally applied. As a Government, we are committed to the idea of attacking the profits of crime in a way that goes beyond drugs offences, and we shall have to return to the subject. We have, however, judged it best to deal with drugs offences and other offences separately. Perhaps they should also be dealt with differently, but that is a matter for another day. In any case, the Bill has been prepared solely as a basis for dealing with drug traffickers and it should be judged in that light. The Government will want to pause and reconsider before seeking to extend any of the Bill's provisions to other offences.
  Mr. Alex Carlile: Does the Secretary of State agree that the Hodgson committee recommended that powers should be introduced to enable the courts to confiscate the proceeds of crime, or money representing the proceeds of crime, not in the circumstances which the Bill rightly postulates, but to reduce the prison population? Does the right hon. Gentleman agree that those constructive proposals in that context should be considered for early legislation?
  Mr. Hurd: There is an argument for that, as one would expect with a proposal that came from the Howard League. We will think hard about it, although not necessarily from the point of view which Mr. Justice Hodgson argued. I suggest that we postpone that discussion to another day and concentrate tonight on this Bill, which deals only with drug offences.
  We need the legislation, because the forfeiture powers in existing law have proved inadequate. The courts cannot

  243
  order the forfeiture of the proceeds of an offence once they have been converted into another asset—a house, stocks and shares, or valuables of any sort. The Operation Julie case was the most notorious example of the courts being unable to deprive convicted traffickers, as they wished, of the proceeds of their offences. Let me give an example.
  In August last year, a group of five offenders were convicted at the Crown court at Maidstone of the importation of heroin with a street value of £2 million. They were sentenced to a total of 146 years' imprisonment. Before passing sentence, the judge inquired into the assets of one of the principals. It emerged that this offender, while awaiting trial, had transferred all his property to his wife. She had then sold the house, put the money into a building society and left the country. The judge was satisfied that the house had been bought partly from the proceeds of drug smuggling, and said that he would have liked to order the confiscation of the money in the building society; he regretted that he had no power to do so.
  The Bill is designed to remedy those defects. It will provide powers for courts to confiscate proceeds even after they have been converted into some other type of asset; it will provide for the restraint of a defendant's property to prevent him from disposing of it before the end of his trial; and in certain circumstances it will allow property placed in other people's names to be confiscated, along with the offender's.
  We have only a short time for the debate, and I do not wish to take up too much of it. The proposals in the Bill were described in a statement which we placed in the Library of the House in November, and they have been widely publicised since then. Therefore, I need not go through the Bill clause by clause. Instead, I shall point out some of the new elements in the Bill to show how they will contribute to our aim of stripping traffickers of their illegal gains.
  Mr. Robin Corbett: It would help the House if the Home Secretary mentioned clause 3. What consideration has he given to the protection of innocent dependants when it comes to stripping the convicted trafficker of his assets?
  Mr. Hurd: If the hon. Gentleman will allow me to continue, I shall deal with that point later. If I do not deal with it to his satisfaction, my hon. Friend the Under-Secretary of State will certainly do so.
  Under clauses 1 to 4, the Crown court will in future be required to determine, in the case of every person convicted of a drug trafficking offence, whether he has benefited from drug trafficking and, if he has, to impose a confiscation order to deprive him of the entire proceeds of his trafficking in so far as they can be assessed. This will be in addition to his ordinary sentence, and will apply not simply to the proceeds of the offence of which he has just been convicted, but to those of his entire trafficking career. Of course, those proceeds will not always be easy to assess. That is because what his legitimate income has been, and which of his assets have been legitimately acquired, are matters which are especially within his knowledge and which cannot easily be determined by others.
  Therefore, we propose in clause 2 that courts should be able to assume that the whole of an offender's property, together with any assets which have passed through his
  244
  hands in the previous five years, represent the proceeds of trafficking, except in so far as he shows otherwise. That provision has attracted special attention. This reversal of the burden of proof will apply only after conviction: the prosecution will still have to prove the offender's guilt beyond reasonable doubt in the normal way.
  We have in addition provided in clause 4 that assets which the defendant has transferred to others for less than full value should also be liable to confiscation, if the transfer took place within the previous five years, or if the property can be shown to represent the proceeds of drug trafficking. It would be an obvious and unacceptable loophole if the trafficker could avoid confiscation by putting the proceeds of his offence into the name of his wife, brother or friend. But such third parties — this should deal with the hon. Gentleman's point — must have a right to put their case, and we have specifically provided in clause 9 for them to make representations to the High Court before confiscation is enforced.
  Just as important as provision for a realistic assessment of the trafficker's proceeds will be provision for effective enforcement. We propose in clauses 9 to 11 that all the authority and experience of the High Court should be available for this purpose. If necessary, a receiver will be appointed to realise the available property. I should point out that any of the offender's property will be liable to confiscation, not simply that which is derived from drug trafficking. Thus, if an offender has spent or salted away his drug income, and kept to hand only his legitimate assets, those assets will be seized instead. If an offender is tempted to keep assets beyond the reach of the receiver, he will face up to 10 years' imprisonment in default of payment.
  Mr. Alex Carlile: I am worried about the concept of sales for less than full value. One can imagine many circumstances in which a drug trafficker, for reasons of his own, puts his house on the market and tells the estate agent to get as much as he can quickly. That may be a sale for less than full value. In those circumstances, do the provisions of the Bill mean that the purchaser, who will be completely innocent, will have to apply to the court and meet the costs even of a successful application?
  Mr. Hurd: I always hesitate to answer the hon. and learned Gentleman off the cuff, because he always poses pertinent and rather difficult questions. If it could be shown—as it could be in the case which the hon. and learned Gentleman mentioned—that there was a bona fide transaction, I think that the purchaser of the house would be in the clear. My hon. Friend the Under-Secretary of State will reflect on that during the evening and will deal with it in his reply.
  The new powers to confiscate the proceeds of drug trafficking are at the heart of the Bill, but they are not all that is required. That is why the Bill includes important new powers to help the police and customs trace the proceeds of drug trafficking, and for the courts to freeze them pending the outcome of the trial.
  Under clauses 18 to 20, the police and customs will be able to apply to a circuit judge for authority to examine bank accounts, financial records, and other important material at an early stage of a drug trafficking investigation — indeed, as soon as they can satisfy the judge that there are reasonable grounds for suspecting that a named person is involved in, or has benefited from, drug

  245
  trafficking and that the material in question is likely to be of substantial value to the investigation. There is a balance to be struck here, which we have spent some time considering, and we are stopping short of random checks or mere fishing expeditions.
  We must further help to ensure that proceeds are not disposed of before the end of the trial. Therefore, we are introducing into criminal law procedures already tried and tested in civil law. From about the time of the defendant's arrest, clause 6 gives the High Court the power to make a restraint order—similar to a civil Mareva injunction—freezing property which might later be needed to satisfy a confiscation order. It will also be able to make charging orders in respect of land or securities, to the same end.
  Another especially important feature of the Bill is the new offence of assisting another to retain the benefit of drug trafficking—in common parlance, laundering. That is a serious activity, for which we propose a maximum sentence of 14 years' imprisonment. As laundering is defined in the Bill as a drug trafficking offence, those guilty will be subject to its confiscation procedures.
  The Bill relates to England and Wales, but we intend shortly to introduce legislation for Scotland and Northern Ireland, and for the Channel Islands and the Isle of Man. Of course, we must be able to chase proceeds further than that, because they do not stop at the boundaries of the United Kingdom. Therefore, we shall seek the widest possible range of agreements on mutual enforcement with other countries. The Bill will provide the framework in English law for such international agreements.
  Mr. Michael J. Martin: I understand from the Solicitor-General for Scotland that Scottish judges have some powers to compensate. If those powers are available in Scotland, why is it necessary to introduce such legislation? I do not say that we should not have the legislation, but I am surprised that the right hon. Gentleman believes that we need it.
  Mr. Hurd: A hasty consultation suggests that in Scotland there is a power to fine but not to confiscate. That matter needs to be further considered among the Scots. Today we are dealing with a Bill which covers England and Wales.
  I hope that I have said enough about the Bill to show how we have approached confiscation as a system rather than as an isolated procedure. We have not looked at the moment, at the end of a trafficker's trial, when the judge orders how much the offender must pay. The comprehensive approach set out in the Bill begins with the examination of financial dealings early in the investigation. It moves logically through restraint of property pending the outcome of the trial and provides the basis for a realistic assessment of the amount of the trafficker's proceeds after conviction. It ends with the enforcement of the confiscation order against property in the hands of the offender or his associates, in this country or abroad. In some areas, we have had to break completely new ground. In others, we have been able to draw on procedures established in civil law and harness the experience of the High Court for the purposes of this legislation.
  I hope the House will agree that in total we have worked out a machinery which still lies firmly within the boundaries of what we in this counry regard as acceptable
  246
  and just but which will enable the confiscation of proceeds to play a major part in out continuing crucial battle against the trafficker. I commend the Bill to the House.
  7.31 pm
  Mr. Robin Corbett: The Home Secretary has given his usual accomplished explanation of the need and purpose of the Bill. I make it quite clear to the House that the Opposition do not wish to delay or impede the Bill. My right hon. Friend the Leader of the Opposition and many other Opposition Members have warned for a long time about the growing horrors of rising addiction.
  There has been an explosion in drug smuggling and addiction, especially in heroin and cocaine, during the last four or five years. It is putting a generation of young people at risk and it is doing great social damage. It demands draconian action against those who make fortunes out of this vile, destructive trade. I anticipate that the Home Secretary and his colleagues will agree with me when I say that most young people, their parents, voluntary workers, teachers, those in the medical and caring professions, the police and customs officers are among those who insist that a better attempt should be made to stem the tide of cocaine and heroin that is reaching these shores and finding, in my view, too easy access to them. There must be no easy hiding place for either the traffickers, their money or their assets. Every stringent, sensible step needs to be taken to secure this end. This Bill is part of that process.
  The Home Secretary referred to the Operation Julie exercise. Assets estimated at £750,000 were identified and converted at that stage into French chateaux, Krugerrands and gold bars in a Swiss vault. That case reached the House of Lords, which had to rule, with considerable regret, that the courts had no powers that would enable them to get their hands on these items which had been purchased with the profits from trafficking.
  I join the Home Secretary in paying tribute to the committee, chaired on behalf of the Howard League for Penal Reform by Mr. Justice Hodgson, which inquired into the profits of crime and their recovery. I pay tribute also to the work on that committee of my hon. Friend the Member for Hammersmith (Mr. Soley) who served with such independent distinction upon it.
  Mr. Hurd: The hon. Gentleman did not agree with what the committee said.
  Mr. Corbett: That is why I said that my hon. Friend served on that committee with independent distinction. That report, and the interim report last year of the Select Committee on Home Affairs, provides the basis for the Bill.
  Traffickers take part in this trade because the profits are so gigantic. Great fortunes are to be made from drug dependency. The degradation to which it leads is now openly to be seen on the streets of London, Birmingham, Manchester, Bristol and other big cities. That applies also to glue sniffing and solvent abuse. It is almost as though large parts of our young society are at war with themselves and with society generally. These young, wrecked, hopeless lives bear testimony to where the profits of trafficking come from and what they cost in human terms. The misery, degradation, estrangement from family and home and broken lives result in the walking corpses who

  247
  provide the luxury life styles for the "Mr. Bigs" in the drugs trade. It is almost, with sustained and severe addiction, as though the just living envy the just dead.
  It is not only the profits that attract the traffickers to the fast fortunes that are available. They do it because, like other criminals, they assess the risks and work out the odds on them and others working with them of being caught. It gives me no pleasure to have to say to the Home Secretary that drug smuggling is now Britain's fastest growing industry. In the United Kingdom the odds regrettably favour the drug smugglers because our defences have been dangerously lowered since 1980. Page 141 of the Hodgson report says:
  "Detecting movement of 'dirty money' out of the United Kingdom has become much more difficult since the abolition of exchange control."
  That must be so. To the extent that the Bill remedies that position and provides powers to raid bank accounts and records of financial institutions, I welcome it. It will put right that deficiency.
  Again I have to say to the Home Secretary and his colleagues that, despite any juggling with the figures, there are fewer customs officers now on the front line of our defences. That must almost inevitably mean that more drugs get through. Even impressive seizures by customs —an estimated eight out of every 10 come from cold searches at ports of entry — and drugs seized by the police indicate not so much success in this war but, in my view, failure. I do not put all the responsibility for that upon the Government, but I certainly put part of the responsibility for it upon them.
  Even the best estimates claim that only about one fifth of smuggled drugs are detected. Others would put the figure lower than that. However, heavier hauls by Customs and police may also indicate that more drugs are getting into this country. In other words, it could be a rising percentage of a rising amount. Between 1978–79 and 1984–85 there was an increase of one third in the number of passengers arriving at our air and sea ports. The total was about 42 million. There was also a rise of 9·5 per cent. in the number of cars and drivers and a massive rise in the number of container lorries. The Home Secretary mentioned that there is evidence of increased attempts to smuggle drugs into this country on lorries. However, precisely at the time when this was happening there was a net cut of 11·5 per cent. in the strength of Customs and Excise. I accept that not all these cuts are on the drugs enforcement side, but it is indicative of the Government's approach until now. The number of customs officers has fallen from 28,800 in 1978–79 to 25,300 in 1984–85. There is a target of 25,500—that is, an extra 200 officers—by 1 April 1986 and it is planned that a level of 26,000 should be reached by 1 April 1988.
  I have to remind the Home Secretary that Mr. Sandy Russell, a customs commissioner, told the Select Committee on Home Affairs on 11 December 1985: "next year"—
  that is, 1986—
  "the position on the preventive uniformed force at the ports and airports will be just a little under the figure it was in 1979."
  In practice that means there has been a 30 per cent. cut in uniformed officers, and that is against the background of an increase of about 10 times in heroin smuggling and an increase in cocaine smuggling of three times since 1979.
  Mr. Greg Knight: Will the hon. Gentleman tell the House the source of his statistics? Is he
  248
  certain that he is correct? I ask because on 12 December last year I put down a written question for the Chancellor of the Exchequer asking how many customs officers were employed on drug detection duties over the previous 12 months. I accept that the hon. Gentleman was good enough to say that he was quoting overall figures and not just the figures for officers engaged in drug detection duties. In my written question I also asked what number the Chancellor of the Exchequer estimated would be so engaged in the coming years. The reply was,
  "1 April 1985, 2,823; 1 April 1986, 3,000; 1 April 1987, 3,300".—[Official Report, 12 December 1985; Vol. 88, c. 771.]
  Therefore, the number of officers appears to be increasing, not decreasing as the hon. Gentleman appears to claim.
  Mr. Corbett: I am grateful to the hon. Gentleman because he has made the point. I do not want to waste the time of the House by bandying figures about. I say he has made the point because no one can deny that from 1979 until lately—let me put it broadly like that—there has been a decrease in the number of uniformed custom officers on duty at ports of entry. Broadly speaking, that means there has been a lowering of customs cover.
  As I said, that has coincided with a 10 times increase in heroin smuggling and an estimated three times increase in cocaine smuggling. I am not trying to make party points about this. I will try to put the point as flatly as I can. I am glad that the customs service seems to have the cash to provide more uniformed officers and more officers on the detection side in order to cope with the increasing amount of drugs, particularly cocaine and heroin, that are being smuggled into the country. That is progress; we can argue in another place about who did what and what they did not do and what they should have done earlier. There will be more officers in place. I welcome that, as I am sure does the whole House.
  Mr. Tom Sackville: Is the hon. Gentleman aware that the number of customs officers in the green channel is not necessarily relevant as long as the green channels are manned? What is important is the number of customs investigators, and that has nothing to do with the number of uniformed officers. If the hon. Gentleman knows anything about the way in which large-scale drug importation is detected, that is what he ought to be saying.
  Mr. Corbett: The hon. Gentleman ought to have a care about what he is saying, because he is going to tempt me into arguments which would be better put at the Committee stage. It is on the record that eight out of 10 seizures at, for example, Heathrow, are the result of cold stops—people coming through the green channel. On the intelligence and investigative side, the number of uniformed officers able to respond to intelligence is quite critical to the catch rate.
  I do not want to start a long discussion about this, because it does not help to get into an argument about whether uniformed people are better than the mobile squads or the investigative officers. I see that the Home Secretary is smiling. I am perfectly prepared to embark on such an argument, but I have an eye on the clock. Both uniformed and investigative officers are important. I sincerely believe—I am trying to put this in a flat way —that the lowering of the uniformed customs presence in red and green channels at ports of entry has not helped

  249
  in the war against drugs. That statement will probably not satisfy the hon. Gentleman, but I hope that we may pursue the detail in Committee.
  There is some evidence, part of which we heard in the Select Committee on Home Affairs, that because of the strength of the defence at airports such as Heathrow more attention by the traffickers is being given to the smaller ports around the east and south coasts as far down as Plymouth. I know the right hon. Gentleman is aware of that but I just want to remind him of it. It must be accepted that customs cover is not at the level we expect for the proper monitoring of the arrival and departure of yachts and other small boats. I do not want to make heavy weather of this point, because I know the Home Secretary is aware of it.
  At the moment there is a review of the work of immigration officers. This is a step before the customs officers come into the picture. The immigration service has accepted cuts and I understand that one of the proposals is to downgrade the status of some of the immigration officers, who are now at executive grade level, to clerical grade level. We in the Opposition are also interested in efficiency, but if proper consideration is not given to the move and adequate training provided before the change is made, we run the risk of lowering the quality of the important on-the-spot decisions which immigration officers are called upon to make at ports of entry. I should like the right hon. Gentleman to take that point on board.
  Hon. Members will agree that in the war against drugs words are not enough. Actions are needed and some of the actions are contained in the Bill. I should like to deal with three or four specific points. The proposed powers of confiscation are in clause 1. We share the view that the drug trafficker needs to be hit where it hurts most, and that is in his assets. There may be problems about the way in which the Bill is drafted, and the Minister may be able to deal with those when he is winding up.
  We are all united in aiming at removing the assets from the "Mr. Bigs" in this game. In that sense we are talking about the wholesaler, but I fear that the Bill will also trap the smaller user-dealer. Many if not most users also deal in drugs. In legal terms they supply drugs to help to finance their addiction, which for an addict is estimated to cost around £9,000 a year. In most cases theirs is a hand-to-mouth existence, and only rarely would the user-dealers have assets of any substantial value. As I read the Bill it is mandatory when someone appears before a Crown court for a sentence for confiscation orders to be made irrespective of the amount of the assets. Is that really the intention? If it is, might it not be more sensible if the Bill were to set a limit below which in relation to the assets, confiscation orders need not be made or, to turn the coin over, a level at which it is mandatory for the court to impose them?
  My second point about confiscation orders is that they can be imposed only in the wake of a drug trafficking offence. What is the position where a person sentenced claims that the assets arose from another illegal activity? Let us instance a bank robbery. In the Bill, confiscation orders relate only to drug trafficking offences, and that is for the reasons that the Home Secretary explained. It would appear that the undetected, uncharged and unconvicted bank robber could have those bank robbery assets left untouched. If that is so, it would seem to be
  250
  unsatisfactory. I am not experienced in these matters, but I am advised that many professional criminals run vertically integrated businesses; in other words, they are involved in a range of criminal activities and it would be difficult to establish with precision which profit had come from which activity. It is unlikely that the villains would voluntarily show the police their profit and loss accounts.
  Clause 15, the laundering clause, creates a new offence in which the burden of truth is put upon the accused. Subsection (3) sets out the grounds for defence, which show how the burden of truth is being moved. We are talking here possibly about a whole chain of people, many of them professionals such as accountants, lawyers, bankers, estate agents and so on. As I read the Bill, it is possible that some or all of those people could be convicted of the handling offence and get a sentence of up to 14 years while the trafficker escaped conviction because of lack of evidence. I cannot believe that that is right or is intended. In practice, it would mean that someone would go to jail because of another person's more serious offence.
  Mr. Alex Carlile: It happens all the time.
  Mr. Corbett: That does not make it right.
  Mr. Carlile: Is the hon. Gentleman really suggesting that a person who has committed a serious crime should not be proceeded against because there is insufficient evidence against someone who has committed a more serious and related crime? That is an absurd suggestion.
  Mr. Corbett: I was trying not to say that. Let us stick to the drug trafficker. If people were to be convicted of charges of handling and laundering and were to get a sentence of 14 years while the main offender got off, that would be very difficult for many people to understand. I understand the hon. and learned Gentleman's point but, if I may say so with respect, it is a lawyer's point and I am trying to put the point of the man on the Clapham omnibus or the Erdington tram.
  Clause 18 deals with the making available of evidence and clause 19 gives authority to search for evidence. The Home Secretary said—in a side comment, I think—that there was no intention of using the powers under these clauses to go on fishing expeditions. The Bill as drafted refers to a constable entering premises and seizing and retaining material. I hope it will be made clear that it will not be any old constable but a constable with enough training and experience to ensure that he knows what he is looking for and that it is strictly related to the suspected offence. In that context there is an obligation upon the Government to ensure that police services have the necessary resources to provide specific training on the handling of financial records. It is not a job that any constable can properly be expected to do.
  The Home Secretary will recall that one of the recommendations of the Select Committee on Home Affairs was that both civil and criminal proceedings should be used against assets. The Minister will know directly, as do those of us who were on the Select Committee, of the experience in the United States. The Americans, and I believe the Australians too, set great store by the alternative of civil proceedings against assets where they feel that the evidence for a criminal prosecution is not strong enough to stand a reasonable chance of securing a conviction. If the Government considered that and rejected it, may we be told why they came to that view?

  251
  The final point is perhaps the most intriguing. What will happen to the seized assets? To bring it up to date, what would happen if, say, Blenheim palace was confiscated? The Bill is strangely silent on that. In regard to financial and manpower effects, the explanatory and financial memorandum assumes that there will be 100 cases a year involving additional costs of £5·5 million, plus £1·1 million extra for customs and excise staff. Reassuringly it coos:
  "This sum is likely to be more than offset, however, by the revenue from confiscated assets."
  So, taking the most cautious view, the Government anticipate that at least £6·6 million will be raised each year from the seizure of assets. I hope that they are right and that that amount is exceeded. That is fine, but who will get the loot? I expect Ministers on the Front Bench to remain immobile when I suggest that there are no possible circumstances in which the Treasury can by any stretch of its vast imagination make any legitimate case to grab the loot. Clearly, it will not be revenue. It will be cash raised from the seizure and disposal of assets. It will not be money owing to the Treasury, recouped through the courts in default, as it were. It will be a new source of money. I can see the appeal of this to the Government, but I am trying to put down markers.
  The matter becomes important when we consider the victim or the victim's family. There has been a recent prosecution against a convicted dealer. I accept that this is a difficult area because, as I understand the law, it is based on the assumption of an innocent victim. There might be argument about someone who is addicted to drugs being innocent, but what will the position be if a victim or his or her family wants to sue a convicted trafficker? In the event of a successful prosecution, where should the money come from? It would be wrong to suggest that it should come out of the taxpayer's pocket if the Government expect to raise £6·6 million from the seizure and disposal of assets.
  I have little doubt that the Home Secretary will need to consult about this. Will he consider the suggestion that all money raised from the seizure and disposal of assets, perhaps after the settlement of any claims against the trafficker on behalf of a victim or his or her family, should go into a trust fund to help pay for the treatment and rehabilitation of addicts? There would be sweet justice and great merit in using the proceeds of this vile trade, properly seized through the courts, to try to rehabilitate those out of whom the trafficker had made part of his fortune. I hope that that idea may commend itself to the House. We shall co-operate to help the Bill reach the statute book, no doubt with amendments, and I invite my right hon. and hon. Friends to support it.
  8 pm
  Sir Edward Gardner: I agree enthusiastically with much of what the hon. Member for Birmingham, Erdington (Mr. Corbett) said. I shall not identify those parts of his speech with which I disagreed, to avoid being drawn into a subsidary debate.
  I hope that I speak for the whole House when I say that this is an admirable Bill with admirable provisions. I congratulate my right hon. Friend the Home Secretary and his colleagues on producing the Bill in its present form —no doubt it will be amended in certain areas—and on the speed with which it has come before the House.
  252
  The House will remember that the Home Affairs Select Committee went to America in the early summer of last year to study the drug problem in the United States. Before the Committee left, we saw my hon. Friend the Under-Secretary of State for the Home Department, the Member for Putney (Mr. Mellor). He invited us to make such recommendations as we could when we returned and to put them into a report which the Government could consider. As the hon. Member for Erdington rightly said, the Bill is based on that interim report's recommendations. I am sure I speak on behalf of all members of the Home Affairs Select Committee when I say that when we returned to our duties here at Westminster it took a long time to shake off the effects of what we had seen and heard in the United States.
  Mr. Jeremy Hanley: I have still not shaken them off.
  Sir Edward Gardner: Indeed. It was a deeply disturbing experience. We saw for ourselves what has happened in the United States and we realised that what has ravished American society could one day, very soon if we are not careful, happen here. We noticed the growth in drug taking. Cocaine—the drug of choice, as it is called—has taken over the American continent. It has 12 million regular users in America and each year claims 5,000 new addicts.
  We saw the power of the people who traffick in these drugs. Their economic power is such that they earn between $90 billion and $100 billion a year. Their industry, if one can dignify it with that word, in terms of money, is second only to the motor industry in the United States. The growth of drug taking in America is something of a phenomenon which has happened during little more than five years. The Americans are a deeply alarmed, as we were as observers, at what has happened there.
  The United States has introduced into its civil and criminal law an amendment which enables it to get at drug traffickers and strip these evil men of every dollar, every bit of land and all the vehicles and aircraft that they boast they own. Much of the money that is collected by the courts is used for anti-drug measures. The hon. Member for Erdington drew this to the attention of my right hon. Friend the Home Secretary. We were also told that some of the money was being used to build prisons in America to contain people convicted of drug trafficking. That makes sense.
  The effect of the American legislation which enables the forfeiture and seizure of the assets of drug traffickers has been salutary and satisfactory. The Committee therefore recommended that our law be amended to allow for the seizure and forfeiture of drug traffickers' assets.
  The short time — it is something of a record —between our recommendations, the Bill's being published and its Second Reading today illustrates the acute awareness of the problem as declared by my right hon. Friend the Prime Minister. The Government are aware of the perils of the drug problem. The Government's determination to avoid and defeat this terrible threat which is hanging over the country will have the support of the House and of the country.
  The Bill is aimed at undermining and ultimately, we hope, ending drug trafficking. As my right hon. Friend the Secretary of State said, this Bill introduces the reversal of the onus of proof. I am sensitive about that and could

  253
  become hostile were it not for my understanding and others' understanding of the gravity of the problem. The Bill will try to solve that problem, so I give it unqualified support. I believe that it will receive support from this House and the country.
  The establishment of the guilt of the accused in the criminal court had to be to the standard of proof of putting the matter beyond reasonable doubt. This is not the most up-to-date direction for a jury, but it does for the purpose of discussing and distinguishing between beyond reasonable doubt and the civil standard of proof which is on the "balance of probability". The Bill, as I understand it, although it is not stated—one does not expect to find the standard of proof defined in a Bill—suggests that the standard of proof is on the balance of probability. When the court has made the assumption that clause 2 allows about the identity of the assets, the defendant would have to satisfy the court that there was no connection between his assets and the offences with which he was charged.
  I agree with the hon. Member for Erdington, in that I wonder whether we could have an explanation why the Government decided to leave reference to civil proceedings out of the Bill and instead chose to focus exclusively on criminal proceedings. The American model, on which we suggested British legislation, enables the court to deal with forfeiture in civil and criminal proceedings. I shall not go into the technicalities of the distinction between the two except to say that, in criminal proceedings, standard proof is beyond reasonable doubt and, in civil proceedings, the balance of probability is standard proof, which makes it easier for the courts. I should have thought, as the Home Affairs Select Committee decided, that that has an attraction that might have an influence on the Government's thinking. I should be grateful for some comments on that.
  I should like to express the Home Affairs Select Committee's gratitude to my hon. Friend the Under-Secretary of State for his assistance and, perhaps even more important, his untiring efforts at every conceivable opportunity. He has travelled wherever he can to fulfil his ambition of ensuring that this terrible plague of drug taking is at last brought under control.
  8.12 pm
  Mr. Alex Carlile: I apologise to the hon. and learned Member for Fylde (Sir E. Gardner) for appearing to interrupt him. He treated us to a splendid speech which, like all of the best Beethoven works, had two perorations. It was at the end of the first that I rose, thinking that he was about to finish.
  Recently, a man called Thomas Comerford, who for years had been the most notorious criminal in the Liverpool area involved in drug trafficking and all manner of other serious crime, was sentenced to many years imprisonment here in London. The more sparsely written newspapers, in their features on the Comerford trial, gave a rather shabby picture of the values of contemporary society. Instead of concentrating, as they might, on the wretched misery which drug traffickers such as Comerford have caused in cities and towns throughout the country, they concentrated their attention on his gains and his life style. It is important that the public should know first that drug addiction brings misery and living death—indeed,
  254
  even death for some. That is what is really being achieved by the drug pedlars, whose temporary affluence is of less importance.
  I do not have the advantage of serving on the Home Affairs Select Committee, but I cannot forget the first time that I met a heroin addict. He was in trouble before the court, which was bad enough; but I remember above all his physical features. I recall his scabby, pockmarked arms, his eyes completely dead like marbles on a solitaire board; and his attitude to life, which to him was indeed nothing more than living death. Young people such as he face that frightful prospect on an increasing scale.
  I pay tribute to the Under-Secretary of State for his part in what I believe is the most important part of the fight against drug addiction—the campaign through schools, through parents with children at school, by advertising and all other channels through which we can reach young people, to persuade them that involvement in drug abuse will destroy their lives. I am pleased to be able to tell the Minister that even in my distant constituency in rural mid-Wales, parents of children at local schools are able to attend sessions at which they are taught how to detect the early signs of drug abuse. My wife will go to one of those sessions later this week at the school which one of our children attends. No effort should be spared to ensure the continuation of such campaigns.
  I welcome the opportunity to enact legislation that will ensure that the ill-gotten gains of drug pedlars are taken away from them. I am sure that the Home Secretary will understand why I have some instinctive misgivings about parts of the Bill but, on balance, it is obviously right to enact it because of the seriousness of the problem. I too acknowledge the contribution made by the Home Affairs Select Committee's report and that of the Hodgson committee—the report of the Howard League in 1984 under the chairmanship of Mr. Justice Hodgson.
  I remind the Government that the Hodgson committee considered far more general issues than drug trafficking. It examined the confiscation of the proceeds of crime generally. Because this Bill has distracted us from the broader issues raised by Hodgson, I regret that the report has been misrepresented to some extent in the publicity leading up to the Bill and today's debate. My perception of the thrust of Hodgson is that the law should be expanded with a view to allowing seizure of the profits of all crime with the idea of reducing the incidence and amount of imprisonment, especially at a time of gross overcrowding in prisons, and also with a view to ensuring that people who commit serious crime do not benefit from their ill-gotten gains.
  I hope that the Bill will ensure absolutely that the proceeds of drug trafficking can be seized. However, I hope that the Government will tell us that they are satisfied that the Bill covers the many serious cases in which the prosecution choose to present specimen counts only on the indictment before the jury. We must be absolutely sure that, when the Bill becomes law, all the ill-gotten gains can be taken by the court, including those which have not formed part of counts in the indictment, provided that due notice is given to the defence. Hodgson made that point and it is important.
  Hodgson emphasised the need for a two-stage process. We are concerned here with the second stage — the power of the court when the defendant has already been arrested. What about the first stage?

  255
  The Hodgson report put emphasis on empowering the freezing of the assets of offenders before they are even arrested. I draw the Minister's attention to conclusion 29 on page 154 of Hodgson, which said:
  "On the application of the police or prosecuting authority a high court judge should have the power to grant… an order freezing specific assets or the defendant's assets generally, if there is a prima facie case that he has committed an indictable offence."
  It seems a little illogical that the power to freeze occurs only after the defendant has been arrested. Surely there ought to be a power to freeze in the course of the inquiry so the police can have the full advantage of surprise during that inquiry. It would be no more, after all, than an adaptation of the now well-established powers developed by the civil courts in the use of Mareva injunctions. It seems to me that clause 18 fails to go far enough in making an effective transfer of the power used by the civil courts in Mareva injunctions to the criminal courts in relation to drug trafficking. It still leaves considerable opportunities for assets to be salted away before the police ever reach them. There may be room for amendment of the Bill in this context.
  I also urge the Government, as did Hodgson, to look beyond drug offences. Having said that, I urge the Government to restrain themselves before applying these particular powers, far beyond Hodgson in some respects, as the unalterable basis for extension to other offences.
  It is worth putting it on the record that there are some mildly, at least, critical views of the Bill. I remind the Minister of the comments in the Justinian column in the Financial Times on 20 January:
  "If the Drug Trafficking Offences Bill passes into law unamended it will represent one of the most fearsome pieces of legislation in modern times, both in the investigative powers it gives to public authorities and in its penal sanctions. In the limited scope of drug trafficking it spreads the tentacles of criminal process far beyond those recommended 18 months ago by an independent committee chaired by Mr. Justice Hodgson. In 'Profits of Crime' it proposed more modest powers over the whole range of criminal activity."
  I share what I think is the Minister's view, that some fearsome legislation is required in this context.
  I seek to urge the Minister to extend the philosophy, but using the Hodgson principles rather than those fearsome principles contained in the Bill. The Bill should not be used as the benchmark, in other words, to justify a relativistic approach to the context of other offences; for some of the provisions in the Bill are quite alarming in the powers they give the police and the courts. In my view, they can be justified only by the serious and special nature of the crimes with which we are concerned.
  I agree with the hon. and learned Member for Fylde (Sir E. Gardner) that one of the most worrying issues has been the reversal of the burden of proof as particularly set out in clause 2(3). However, I support the Home Secretary in the point that this is not a reversal of burden of proof relating to guilt; it is a reversal of burden of proof relating to a procedural and sentencing matter, and in that context in my view it can be justified. It is of course worth bearing in mind, when we are discussing our judgment on the question of reversing the burden of proof, the fact that the Hodgson committee did indeed divide on the issue even though it was considering far lesser powers than are before us in the Bill.
  We have to be a little cautious about these powers because, whenever a court convicts of a drug trafficking offence, the court will be empowered—indeed will have
  256
  —to assume that the whole of the defendant's assets together with any property that has passed through his hands during the five years prior to conviction are the proceeds of drug trafficking.
  With that in mind, I am concerned about the position of what may very well be innocent third parties who may have bought a house, a car, jewellery or whatever at less than full value but in good faith. It is very important that we should ensure that, if they have to apply to the court in effect to keep property which they have bought in good faith, they should not have to be faced with legal costs in making such an application.
  Mr. Greg Knight: Can the hon. and learned Gentleman give us an example of an occasion when a person could buy property at less than a full value in good faith?
  Mr. Carlile: I think I gave an example a little earlier. A drug trafficker who suspects that the police are on his heels may have a property to sell—a house, for example—which he will hand to an estate agent and order him to sell very quickly and for whatever he can get. It may be sold very quickly to a purchaser who will be acting completely in good faith and without the slightest idea of who the drug trafficker is, let alone that he is a drug trafficker. It is important that a person in that position should not be faced with having to fund legal proceedings. There are many other examples of which I can readily think.
  For the entirely laudable purpose of protecting young people from the dreadful ravages of drug addiction, we have embarked on what is actually a rather unenticing legislative path. Some of us have had to wrestle with the argument that these are laws which change substantially and to very great disadvantage the position of a defendant before a court. Generally, I do not welcome laws which do that. I do not generally welcome laws which place upon a defendant, outside the broad philosophy of our system, both an evidential and a legal burden which it may often be extremely difficult to discharge.
  I suspect that, as a result of our eventually enacting these provisions, there may be some injustices, especially to third parties, and of course we all know the truism "hard cases make bad law." But the crisis caused by burgeoning drug offences is such that I am persuaded to support the Bill, albeit in the belief that it is somewhat imperfect and may well be capable of some improvement.
  8.27 pm
  Mr. John Wheeler: This is an unusual evening, in that hon. Members in all parts of the House are in wide agreement with the measure proposed by the Government.
  I am delighted to speak after the hon. and learned Member for Montgomery (Mr. Carlile) because I share many of his concerns as, indeed, did the Select Committee on Home Affairs when it considered its report on the issue. As the House has heard so eloquently and magnificently from my hon. and learned Friend the Member for Fylde (Sir E. Gardner), we were in no doubt, following our investigations of the drugs issue both at home and overseas, that the quite exceptional circumstances justified the measures which we proposed and which the House is now considering.
  I do not propose to repeat what has already been said, save to draw on one or two more points. I recall, in

  257
  company with my colleagues on the Home Affairs Committee, going to a secret storehouse in Miami and looking at a relatively small room which was crammed from floor to ceiling with cocaine and heroin and other drugs in smaller quantity which had been seized by the authorities. There was at least £10 billion-worth of drugs in street value in one small room. It represented a small amount of the drug traffic that was entering the United States from central and south America. It represented awesome financial power.
  When afterwards we went on in Miami to see the customs, coastguard and revenue authorities and we saw the extent of the wealth, particularly in the vessels, the buildings, the property and the assets that the people who managed drugs were making out of this evil crime, we were in no doubt at all about the seriousness of the problem and the terrible risks that we in the United Kingdom and, indeed, in the other western countries run unless we can unite in our efforts and ensure that our defences and our law are up to defeating these evil people. As a result of those experiences, we made the recommendations that go to the heart of our legal proceedings, as the hon. and learned Member for Montgomery has said, and hesitatingly seek to reverse what is normally regarded as proper in our legal system.
  In discussing this subject in the United States, I learned from the police there that about 60 per cent. of all property crime is committed as a result of the need of the drug user to fund his or her drug taking. Thank goodness, we do not appear to have reached anywhere near that level of drug-related crime in the United Kingdom, but there is growing evidence that some crime, and some serious crime, is being committed by those who wish to fuel their addiction to drugs.
  Therefore, it is right that we should support the Bill. In the Home Affairs Committee interim report on drugs, we set out a strategy that the Government are determinedly following. We suggested four basic ways to deal with the growing threat of the international drug traffic. First, we suggested that they include stopping, as far as possible, the importation of drugs—first by the physical interception of supplies, secondly by the prosecution and punishment of those engaged in this traffic and thirdly by eliminating all drug crops.
  I share the enthusiasm of the House for the work that my hon. and learned Friend the Under-Secretary has done in his globe-trotting activities to achieve the third of those points. It is no good merely looking to the defence of the United Kingdom. We have to involve the international community—those countries where drugs may be grown and produced and those through which the drugs may pass in the course of their journey to the United Kingdom and other western countries.
  Secondly, we suggested attacking the profits of the traffickers, a measure set out in the Bill. Thirdly, we suggested stopping the disposal of drug profits through the laundering of money, which is again set out in the Bill. Finally, and in some ways most importantly, we suggested reducing the long-term demand by education. That is a most complicated subject, which requires the wholehearted commitment of the community and all the institutions within the community, particularly those engaged in education. I hope that, in the inner cities in particular, the local authorities and those responsible for
  258
  education will take this subject seriously. Sometimes I think that in the inner cities there is complacency about drug-related crime that we must resist. We must turn back to a determination to tackle this subject with immense enthusiasm.
  There is no doubt that in some ways the first line of defence is our customs and police services. The Home Affairs Committee looked at both those services carefully. Whatever may have been the case in the past, today they work together with a dedication and courage that is a joy to behold. The Committee was most satisfied about that part of the institution.
  It is important to have customs officers on duty at air and sea ports, but, as we heard both from the evidence in the United States and from our customs officers, to pretend that one can stop all the drugs coming into the country at air and sea ports is nonsense. It was reckoned in the United States that only about 10 per cent. —even that was a generous estimate—of all drugs approaching the United States would be detained by the authorities, even with an enormous amount of money and expertise and vast services, including the armed services, engaged in the exercise to beat the importer.
  In the case of the United Kingdom, what matters is not the number of customs officers but the extent of their training to stop the person who is carrying. The so-called cold stops, 80 per cent. of the spot checks, are not random spot checks but stops carried out because the customs officer identifies the profile of the individual coming through the port and is resolved to investigate.
  I place immense importance on the investigation services. I am delighted that the Government have increased the number of specialised customs officers—those who do the hard-core investigation—from 121 to 212, with a further 50 to be appointed to new preventive posts. That is important, just as the gathering of intelligence for the more sophisticated exercises is vital. I am pleased that the Government are extending the number of overseas posts for customs officers engaging in the intelligence gathering operation. Through a variety of strategies involving all our resources, and above all through our determination in education, we shall contain and defeat the threat that faces the people of the United Kingdom.
  8.37 pm
  Mr. Michael J. Martin: I am glad that the Under-Secretary of State clarified the point about legislation in Scotland, and I look forward to the Bill's provisions being extended into Scotland and Wales. I have been assured by the Solicitor-General that any criminal trying to evade the law by putting assets into Scotland would not succeed. I welcome the legislation. It is a step in the right direction. I recognise the excellent work that the Minister has done in the past year.
  My constituency was changed to include another area by the Boundary Commission at the last general election. The area was well known to me because it was a part of Glasgow where I had served my apprenticeship and I had made many lifelong friends. It was the area from which my wife came, and she had lived there since she was a child. It was a typical Glasgow housing estate with tenemental property—what was known in Glasgow as intermediate housing. I am not saying that every part of the estate was attractive and that it did not have its problems of vandalism and crime. However, I was

  259
  shocked when constituents started telling me that they wanted out of it because they were fed up with the drug addiction in the estate. Despite those complaints, there was not a cheep in the newspapers about the situation and no statistics to show that the problem was so serious.
  One woman brought the situation home to me. In one of the unusually good summers recently, she lifted the window in her flat to get some fresh air. She had lived in this part of Glasgow for 30 years. She looked across the street and there was a young addict in another tenement property injecting heroin into himself without even bothering to draw the curtains. I was absolutely horrified. When I tackled particular officials in the Health Service, they denied that the problem was any worse than in any other part of Glasgow. They tried to play the affair down. I did not publicly mention the area because I did not feel that it was fair to do so, but I did mention it to them and they told me that it was nonsense.
  It is sad that, when officials are faced with a problem, they try to cover the matter up. When I confronted them at a meeting with my colleagues, they then produced a map which showed drug addiction problems in every postal district of Glasgow. Lo and behold, the very area that I had complained about had the biggest addiction problem known to the Health Service—and that was only the tip of the iceberg.
  I know that this legislation does not cover the Health Service, but I want to suggest that the Minister looks at the problems faced by Health Service staff in general hospitals. Consultants in my local hospitals tell me that they have to carry out heart bypass operations on people who are only 22 or 23—certainly less than 30. This creates a problem in a general hospital ward.
  I do not want to give the impression that I think that drug addicts should not be treated under the Health Service; I simply want to show the problems that they cause. As a consultant explained, his medical and nursing staff are not trained to look after drug addicts; they are trained to do surgery and to nurse post-operative patients. The trouble is that the addict still has the craving. The staff need eyes in the back of their heads to look after these patients and to make sure that the other patients are also looked after.
  I know that we need more resources for education and for the police, but I hope that proper resources are put into our hospitals to make sure that both addicts and other patients are looked after properly.
  I was born and bred in Glasgow and am proud of my native city. It is a very friendly place. But one of the things about being brought up in a city like that is that from early childhood we got to know the names of the criminal element on the Glasgow scene—what we call the hard men, the heavy men, the loan sharks. I know them all by name. These people are no longer into doing the collecting for moneylenders; they are no longer into bank robberies; they are no longer the first people to be served in the queue at the post office because they happen to have a double-barrelled shotgun. These people are now into the drug scene and are making a great deal of money.
  Good luck to the Home Secretary. All I can say is that he will have a tough job, because these people have had their ill-gotten gains transferred into property in Spain and in Ireland. The money has gone into pubs, garages and various legitimate businesses. Possibly because of their background, these people also seek the cloak of respectibility: when a charity function is being held, they
  260
  are there. They try to gain acceptance in the respectable parts of the community by giving to charity and so on. It will be a difficult job to get these assets into the public purse where they belong, but I certainly wish the Home Secretary and the Secretary of State for Scotland well in trying to tackle the problem.
  I also ask the Home Secretary to look at the situation in council estates. I have the highest number of multistorey dwellings of any constituency in the United Kingdom. On the estate that I mentioned earlier, there are serious difficulties in keeping the peace, because these drug peddlers are operating from council houses. Next to pubs, the main places for selling drugs are council houses. The houses have double-security doors. The drags are passed through a letterbox. If the police come to the door, by the time that they get the door down, the stuff is washed down the WC. In addition, addicts are coming to the wrong door and are waking people up at 2 o'clock and 3 o'clock in the morning.
  This is known to the housing department but meets with a great deal of complacency: "Unless the police take action, we can't do anything about it." In one case, in the Balgrayhill flats in my constituency, the police managed to take action. The pusher has been tried, sentenced and gaoled. Now his common law wife has moved into the flat, which means that the flat will become available for that person when he comes out of prison. He could start pushing drugs from that house. Even if he does not, this kind of incident fills the neighbours with fear. The fear among the elderly in that multi-storey block is shocking. Decent men and women, who have fought to keep a good community together, are sitting wondering whether, when he comes out of prison, he will go back there.
  I do not like to see anyone left homeless. I spend long and weary hours at my surgeries, where 90 per cent. of the problems brought to me are related to housing. But I have no hesitation in saying that, if a house has been used for pushing drugs, the tenant should be evicted and a decent tenant put in, to give people the quiet life they deserve and to which they are entitled.
  I congratulate the police on their efforts in Glasgow; they have no easy task. I understand from speaking to police officers that when they are searching a house they have to keep a close watch, even when they are going round a settee or a chair, because if they get a jab from a needle they may catch AIDS or a serious form of hepatitis. I do not envy them their jobs.
  Mention has been made of the programme about Operation Julie. I do not know what licence the producers of that programme had—television sometimes changes events in some respects—but it seemed a very accurate record of what actually happened. I gathered from the programme that the officer involved was not always given the help that he required from his senior officers. Sometimes he was hindered. If that happened, I hope that it will not happen again. When the officer concerned was interviewed in a subsequent programme, he said that a national drugs squad was needed to co-ordinate the efforts of customs officers, policemen and everyone the length and breadth of the country in tackling the problem.
  When I visited the United States—not with a Select Committee—I spoke to Congressmen who told me that cocaine pushers were prepared to see boats and aeroplanes shot down — assets which cost millions of pounds—because they have so much money that they can put

  261
  another one into operation straightaway. Those pushers are now looking at Europe as a market and are attempting to push cocaine in the United Kingdom.
  It would not be correct or proper for me to say that I have studied the advantages of having a national drugs squad, but if a police officer who has been involved in one of our biggest operations suggests such a squad, it is worth considering that suggestion. Will the Minister consider it?
  My final point is related, although perhaps only indirectly, to the legislation, but as the Scottish Office Minister is present I have a chance to put the matter on the record. In my area, genuine and decent people are attempting to tackle the drug problem by counselling and helping young addicts. At a public meeting held, unusually, in a church, I noted that the different voluntary groups seemed to be arguing with one another, and saying that one group was better than another and that some groups were not doing such a good job. I said to myself, "It is shameful, when we are dealing with the lives of young people with a serious disease—drug addiction—that we leave tackling that problem in the hands of amateurs." I do not want to stifle amateurs or volunteers, but we must consider the present circumstances in various communities where small groups take over a flat in a tenement and create problems for the neighbours. Moreover, we do not know the credentials of the volunteers. Some could be of dubious character, and sometimes they are taken on at face value by the project leader.
  It is sad that young men and women who, because of their drug addiction, could be dead this time next year are left in the hands of such groups, which cannot cope. We need the help of the National Health Service in tackling the problem. It is shameful that in Scotland we do not have even one facility where we can take an addict from his or her environment and treat him or her in isolation and away from the community that tempted him or her to take drugs.
  I hope that those matters are taken on board. I am grateful that some steps are being taken to attack the people who are making massive profits form ill-gotten gains.
  8.54 pm
  Mr. James Hill: It is right for the House to congratulate my hon. Friend the Minister, who has done a splendid job. He has seen parts of the world where drug traffickers are sentenced to death, and the opium trails and poppy fields of India, Afghanistan and Turkey. All those trails end up in the vast continent of America, and they are beginning to be directed to the United Kingdom. Nobody could find much to fault in the Bill. The Committee stage should be remarkably friendly, and I congratulate my hon. Friend on his excellent Bill.
  First, Mr. Big must be traced, and the Bill is aimed particularly at the Mr. Bigs. There are small pushers who live in council houses and who have no assets, but the Mr. Bigs are around. There are no two ways about it. Moreover, the organisation is extremely big. It may be difficult to freeze and confiscate funds because the Mr. Bigs will try to act even quicker than the courts. The few days between tracing Mr. Big and Mr. Big getting the alarm and the court accepting a confiscation certificate application will have to be narrow.
  262
  In the Legal Affairs Committee of the Council of Europe I have already criticised the Swiss banking system, with its numbered accounts, and the completely and utterly secure banking facility it offers for those with vast sums which they do not wish to disclose. Switzerland is a well organised country and the Swiss are extremely law abiding, but it has kept open an Aladdin's cave for master criminals. As my hon. Friend will know, it will be extremely difficult to get the numbered accounts to disgorge their assets. Although some international agreement may be reached, I doubt it.
  The Customs and Excise is to receive 35 more investigation officers. In Southampton the collector of Customs and Excise, Mr. Jones, has been under severe pressure for some time because of the shortage of staff. Whether they are uniformed or working under cover, it does not matter. I am sure that the collector of Customs and Excise in my area will be pleased to see provisions made for extra staff. The difficulty is that all the yachting harbours and marinas that are being built now on the south coast are almost a complete open door. A Customs and Excise dinghy cannot be expected on a weekend to catch up with all the powerful yachts that are steaming in and out. This must be dealt with drastically by additional staff who make it a point almost to swamp certain marinas on certain dates to pluck out those using the channel as the easy means of entrance.
  I understand that my hon. Friend the Under-Secretary of State wants to know how far the Bill should be expanded in the future. I have already written to my hon. Friend because I feel that all those who profit by vice should be included. I think particularly of the massive amounts earned from prostitution in my area. There is a small number of organisers. Proceeds from the soliciting trade are such that a fine of £10,000 is almost a joke.
  Sometimes, the vice barons, as they have been called by my local newspaper, may well own a whole parade of houses and be housing all their "staff". They may be making enormous profits and, even if they go inside for a year or two, the business may carry on as usual. We must stop that. We have to show that these criminals are prepared to live by vice, and that there is no profit at the end of the day, and certainly no moneys waiting for them when they come out. The difficulty will be in tracing the amounts. This is another part of the Bill which is practical, which means that anyone laundering illicit money will be subject to a prison sentence.
  I am sure, Mr. Deputy Speaker, that you are not a gambler, but most of this money seems to be laundered through practically every gaming house, every race course, greyhound course, motor racing track —practically everywhere that large sums of money change hands through gambling. In the United Kingdom, legitimate business use of this money is not quite as apparent as it is in the United States. The dealers do not have large legitimate businesses at the moment, but I am sure that if organised drug trafficking gets a real foothold in Europe they will have identical businesses for laundering money. That will be a very difficult problem, but I am pleased to see the provision in the Bill.
  Anyone who gives information when Mr. Big has been traced and either prevents the seizure of assets or alarms the criminal can be sentenced — once again, I must congratulate my hon. Friend the Under-Secretary of State — to a maximum of five years for disclosing information. It may be only a whispered message over the

  263
  telephone but it does irreparable harm. Naturally, it allows the criminal to take all necessary precautions with his assets. He could easily leave the country at short notice.
  If confiscation amounts to more than £1 million and the criminal evades the confiscation order, up to a maximum of 10 years will be added to his prison sentence. That is worth while. We must take the profit out of criminal activities. It is as simple as that. Although we cannot legislate for every detail—I am sure that in Committee it will become even more apparent that it is impossible to do so—nevertheless, the Bill is a round picture showing how to deal with those who live by vice or criminal activities. I hope that my hon. Friend the Under-Secretary of State will comment on the increased number of criminal activities that can be included in this assets confiscation.
  This measure will put a chill on the master criminal. It is no good him working for nothing. If we make it hot enough for him, he may try another country or decide to turn to legal work, although I doubt it.
  Mr. Alex Carlile: Lawful work.
  Mr. Hill: Yes.
  The report of the Howard League on the profits of crime and their recovery puts this succinctly. During the past 20 years, liberalisation has crept in so that the victim is given less consideration than the criminal. I am pleased that we are reversing that trend. I wish Ministers every success in Committee.
  9.6 pm
  Mr. Robert N. Wareing: It makes a change to be able to join forces with all hon. Members in supporting a Bill. I commend the work of the Under-Secretary of State—the hon. Member for Putney (Mr. Mellor)—on this aspect of what should be a multi-pronged attack on the vile drug pushers and those who wish to inflict even more social ills on an ailing society.
  In some respects, my constituency is similar to the constituency of my hon. Friend the Member for Glasgow, Springburn (Mr. Martin). My constituency does not include the same number of multi-storey blocks as my hon. Friend's constituency, but there are some. They give cover to some drug pushers who use binoculars to look for miles around at strangers coming on foot or by vehicle. The Bill does not do enough.
  Although the Bill attempts to deny the evil drug pushers their ill-gotten gains—my constituents would back me to the hilt in whole-heartedly commending that provision, although they do not by any means favour the Government's other policies—I am bound to ask myself whether this measure meets the problem in areas such as the Croxteth housing estate in my constituency.
  On 31 July 1984, I wrote to the Prime Minister about the case of Jason Fitzsimmons, the 14-year-old youngster who died from the effects of a drug cocktail he had taken because he had been a heroin addict for some time and was attempting to find an antidote. My letter called for urgent action to designate areas such as Croxteth and the Ford estate in Birkenhead as special priority areas—not just in terms of policing, although that is a problem in itself. The measures that have bitten into the drugs problem have come solely from the Home Office. Unfortunately, the Government have not produced a sufficiently coherent policy.
  I am pleased that on Merseyside the drugs squad has been increased by 18 officers and that it is concentrating
  264
  on areas such as Croxteth. We need more than that. There is a need for the establishment of local treatment centres on the estate to treat the victims of the drug problem. There is a need for the funding of local bodies. Unfortunately, because of other Government legislation to abolish Merseyside county council and other metropolitan counties, one of the sources of funding for voluntary bodies attempting to tackle the problem is being removed. Councils such as Liverpool. no matter what controversy there might be about the measures that the city council has taken, have been under great pressure as a result of the reduction of rate support grant.
  Mr. Mellor: I want the hon. Gentleman to know that we take the problems of Liverpool seriously. I opened the Hope street clinic last year. When I visited Liverpool we were able to estimate that in the previous year almost £l million had been devoted by central Government resources to the alleviation of Liverpool's problems. I had food for thought when I visited the Merseyside drug centre because, of the full-time workers employed there, six of them were paid for by the Wirral borough council, which is less of a large spender than Liverpool council. At that time, Liverpool city council was funding only one centre. Spending priorities come into this issue. The Government have certainly not forgotten the problems of Liverpool.
  Mr. Wareing: I am pleased to hear that, but I do not agree with the hon. Gentleman. There are many areas that I think the Government should be dealing with. I noted the comments of the hon. Member for Westminster, North (Mr. Wheeler) about reducing the long-term demand for drugs. He talked about the need for education. Nobody would argue with that. However, although I would not over-emphasise unemployment as a factor, I insist, because I know Croxteth and Norris Green as I was brought up in the area, that the problem of drugs has appeared only recently. It coincides with the enormous increase in youth unemployment which, on those two estates, is now over 90 per cent. Unemployment is not the only factor but we cannot argue that a reduction in unemployment in those areas would not help to destroy the market for the evil products. The Government must look at that issue in working-class housing estates such as Croxteth.
  One must remember that there have to be local outlets for the energy of young people. Perhaps when the Minister visits Liverpool again he will look at the sports centre provided by the local city council. Although the council may be abused, it provides an outlet for the people of a socially ravaged estate.
  The Under-Secretary of State has mentioned the Hope street clinic. Most of those who are afflicted by the drug disease are not living in the centre of Liverpool in the area in which the Hope street clinic is to be found. Instead, they live in the outlying areas, in Birkenhead or in Croxteth in my constituency. Clinical advice and treatment should be available on the spot where drug takers are to be found.
  I fear that good accountants will save some of the drug pushers from the full punishment that is set out in the Bill. However, as I am neither an accountant nor a lawyer, I shall await advice on that issue. I reinforce the argument which was advanced by my hon. Friend the Member for Birmingham, Erdington (Mr. Corbett) on the need for more surveillance at ports of entry. I know that the hon. Member for Westminster, North has doubts on this score

  265
  and has some evidence from the United States to support them, but the figures speak for themselves. In the letter that I received from the Prime Minister, the right hon. Lady mentioned the 160 customs officers who have been appointed, but 60 of them are merely redeployed officials. The other 100 have been appointed only because planned cuts have not been implemented. Thousands of general officers in the customs service have been lost to us since 1979.
  I understand that 93 per cent. of the drug seizures at Heathrow have been the result of cold finds following spot checks. Out of 97 detections, only seven were the result of information received. That shows that more uniformed officers are required irrespective of the doubts that some might have about their efficiency falling short of 100 per cent.
  Dover is one of the main ports of entry, and many of those entering the country do so by car. If others have their way, even more will come by that route via the Channel link. That factor can be thrown into the general argument about the Channel tunnel. There are 23 car bays at Dover but only seven are being used, because of staff shortages. We know that 75 per cent. of those entering Britain do so through Dover or Heathrow. Yet, according to the Civil and Public Services Association, the union which represents the officials concerned, only one in 400 are stopped as they pass through the green clearway. Despite the comments of the hon. Member for Westminster, North, there must be something to be said for remedying that deficiency.
  Since 1979, there has been a 236 per cent. increase in the number of notified drug addicts. Residents in parts of my constituency suffer many of the drug-related crimes of burglary and mugging. Indeed, in some areas of my constituency people are loth to leave their premises even during the day. Some of the few who have employment have even been deterred from going to their places of work because of the prospect of their homes being burgled in their absence. The burglaries are all too often the result of young people who are unemployed and who are looking for kicks. They get their kicks by taking the drugs which the evil men are pushing. They have nothing more to do with their time.
  The hon. and learned Member for Fylde (Sir E. Gardner) has made a number of impassioned pleas for action. He made one tonight, and as Chairman of the Select Committee on Home Affairs he was responsible for that Committee's report. I offer no excuses for repeating to the House part of what that report states:
  "We believe, from all that we saw and heard, that as the American market becomes saturated the flood of hard drugs will cross the Atlantic. We fear that unless immediate and effective action is taken Britain and Europe stand to inherit the American drug problem in less than five years. We see this as the most serious peacetime threat to our national well-being."
  The Bill, commendable though it is, is a inadequate response to that challenge. It is only a step on the way. Piecemeal approaches, even if they are prefaced by the Home Secretary's admission earlier today that a much more coherent policy is necessary, deny the House the chance of a full-scale debate on all the social problems relating to the drug addiction problem. We need a comprehensive and coherent policy that will examine
  266
  unemployment and deal with surveillance at the ports of entry, as well as merely dealing with policing and the ill-gotten gains of the drug pushers.
  Tonight the Opposition will give their approval to the Bill which, on this occasion, will have the support not only of myself and the majority who support me politically in my constituency, but of all my constituents.
  9.23 pm
  Mr. Tom Sackville: I am grateful for the opportunity to intervene in the debate as the Bill represents a major and radical step forward in deterrence and prosecution of drug traffickers. In particular, I congratulate my hon. Friend the Under-Secretary of State on his efforts in bringing the legislation before the House.
  There is agreement on all sides of the House that the people who perpetrate large-scale drug trafficking are as evil as any other category of criminal. Amendments to the law have already been made making sentences more suitable to the scale of their crimes. But the profits that are made from drugs make even these risks look negligible. The possibility of a spell in prison seems acceptable to many criminals if that is to be followed by access to a considerable fortune on leaving prison.
  From the point of view of many more organised criminal groups which may be involved or which may be thinking of becoming involved in drug trafficking as an additional dimension to their normal sphere of operations, the additional legal risks and complications to which they will be exposed as a result of this legislation would pose a real disincentive.
  Some aspects of the Bill do not go far enough. In particular, I am concerned that the assessments of the proceeds for confiscation should be limited only to those assets which can be shown to be in the possession of the defendant or held on his behalf. There will often be cases where he or she has been convicted of trafficking which will have yielded profits vastly in excess of the visible assets. It should be open to the courts to take that into account in assessing proceeds so that convicted drug traffickers will be forced to repatriate funds, if necessary, to avoid the further sentences provided by the Bill for nonpayment.
  My other main area of concern about the Bill has been referred to by other hon. Members. Given the sophistication of financial markets and of many of those involved in drug trafficking today, it is not inconceivable that a suspected trafficker could arrange, through a single telephone call, to have substantial assets moved out of the country between the moment of arrest and the obtaining of a restraint or freezing order. There can be no clearer case for amending the Police and Criminal Evidence Act 1984 to delay notification and keep a suspect incommunicado in such cases to avoid that possibility.
  Another area of concern is how to recruit the necessary expertise to carry out the financial operations envisaged by the Bill. As with the growing problem of financial fraud, it may be too much to expect officers with purely police training to carry out such work. I suggest that Ministers consider recruiting from the areas of finance, paying the salaries necessary to recruit such people. We may also need some kind of central multi-agency unit to take full advantage of the provisions in the Bill. This would cover specialists in various areas, including the Inland Revenue, but I believe that it would be improper if the people concerned were not ultimately under the control of the

  267
  criminal investigators. I understand that experience abroad, especially in Canada, shows that in some cases financial investigations have run ahead of criminal investigations and the persons under investigation have been warned off and thus escaped arrest.
  The arrangements for the seizure of assets and the provision of evidence from other countries are also relevant. If the trail ends when assets leave this country, many of the benefits of the Bill will be wasted. I hope that in winding up the debate my hon. Friend the Under-Secretary of State will report on negotiations with other countries on this important aspect.
  Finally, to put the Bill into the context of the drug problem as a whole, there is a huge and, I fear, still growing demand for hard drugs in this country and so long as that demand exists it will be met in one way or another. With 40 million passengers and millions of vehicles and cargo shipments coming into this country, drugs are bound to arrive here. Efforts at education, I fear, are still in their infancy, but until children realise that involvement with drugs puts them in the greatest physical and mental danger and until parents realise that it is up to them to see what their children are up to and with whom they consort I do not believe that any real progress will be made.
  Unfortunately, the Bill is not about demand but only about supply, which might be thought easier to control, although not much easier. If one shipment of drugs is intercepted there is no doubt that there will be others to replace it. Nevertheless, it is vital that supply is disrupted as often and as widely as possible so that the street price of) drugs is kept high and life is made more difficult and dangerous for the major drug traffickers.
  The Bill is a radical measure, and I am certain that it will contribute to those aims. Even if its effects make only a small dent in the problem, in view of the gravity of the problem it is a major step in the right direction; and for that reason I unreservedly welcome it.
  9.29 pm
  Mr. Stuart Bell: It is a pleasure to be among friends with whom I have served during the past two years on the various Home Affairs Committees. However, I hope that the Whips do not take that as an offer to serve on the Committee stage of the Bill. My intervention shall be short and, I hope, cogent. Several hon. Members have remarked on the work carried out by the Under-Secretary of State for the Home Department. He has had a series of peripatetic journeys round the world and the hon. Member has made the word "ubiquitous" sound pleasant. I am not on the Home Affairs Committee at present, but I have followed with great interest the work of the Under-Secretary of State. I have read the various documents produced by him and I have followed the progress of his initiatives, one of which is the Bill, which gives new powers for tracing and freezing the proceeds of drug trafficking. The Bill is welcomed by my constituents and I add my congratulations to the Under-Secretary of State.
  The issues that I wish to raise relate to my constituency of Middlesbrough. Like my hon. Friends the Members for Glasgow, Springburn (Mr. Martin) and for Liverpool, West Derby (Mr. Wareing), we have several problems on Teesside, but none as grave as those that we have heard about tonight from my colleagues. The problems on Teesside are of solvent abuse and prescribed drug dependancy, rather than hard drugs. For that reason, I
  268
  participate in the debate to show the determination of an elected representative of Teesside to ensure that the position does not worsen. My hon. Friend the Member for Liverpool, West Derby (Mr. Wareing) mentioned the threat, or even the forecast, that our drug problem might be as great as that of the United States within five years. My hon. Friend called for a comprehensive and cohesive policy and a whole range of Government action to deal with the problem. My remarks relate to that Government action.
  Recently on Teesside the local customs and excise took the decision to redeploy a rummage crew working on Teesside. The duties of that crew were to search vessels and to seek out drugs and other illicit cargo. It was decided that those men should be redeployed to other duties. The appropriate unions, the Minister of State, Treasury, and I intervened. As a consequence, the redeployment, decided upon by the collector of customs in Newcastle upon Tyne, is deferred until 30 September 1986. The Minister of State, Treasury, was kind enough to explain to me the background to that decision. The proposed deployment was in accordance with customs policy to allocate resources to the best possible use. He pointed out that in the interim, local management will reappraise the need for the rummage crew, taking account of local and national priorities and any resources for customs preventive work that are allocated to the region. We follow with interest the future of that crew.
  The hon. Member for Westminster, North (Mr. Wheeler), in a speech to which I listened with great interest, referred to the work of the customs service as being the first line of defence. He rightly pointed out that we cannot stop all the drugs that come into the United Kingdom through sea ports and airports. He noted that only 10 per cent. of the drugs entering the United States can be detained by the authorities, despite the enormous amount of money and the vast resources at their disposal. However, that does not mean that there should be no attempt at the ports to prevent drugs from entering. The hon. Member also made the point that the number of specialist customs officers has been increased from 121 to 212, with a further 50 being appointed. My hon. Friend the Member for West Derby mentioned redeployment and said that those figures show some redeployment.
  The concept that there is an attempt at the ports to prevent drugs from entering and the concept that not all drugs can be stopped are not mutually exclusive. It would be wrong for would-be traffickers in drugs to get the impression that we shall be lax at our ports of entry and that they are an easy target for the importation of illicit drugs. We must accept that our island position is somewhat different from that of the United States, which has a long border with Mexico. Therefore, we can curtail the illicit importation of drugs, notwithstanding the fact that, in a few years time, we may have a Channel tunnel. The rummage crew on Teesside and the customs and excise officers at the ports of Glasgow, Liverpool and Southampton should be maintained so that the threat of apprehension might at least be a deterrent.
  The South Tees district drug advisory committee, established in July 1984, wished to fund a resource centre on Teesside that could set up a professional action committee to treat drug addicts and possibly to counsel them. It also considered the appointment of a full-time worker who would work under the direction of the action committee. It asked the DHSS for £86,000 over three years

  269
  to fund the resource centre. It was a multi-discipline committee of health authority, local authority, the police, the probation service and voluntary organisations.
  Unfortunately for Teesside, that request for funding was rejected. The Under-Secretary of State will recall that he was kind enough to advise me that the Phoenix house residential rehabilitation centre, which is established in London and Sheffield, proposed the opening of a residential rehabilitation facility in south Tyneside, for which it received a grant of £273,419 over three years from the DHSS. Its 30 places were meant to cover the north of England. My constituents are worried by the fact that there is no provision between Newcastle and York or Leeds, and it is a matter of some concern to us that the application was rejected.
  However, during the past few days, Middlesbrough has heard the good news from the Department of Education and Science that it will fund an advisory teacher to fight drug abuse. The teacher will liaise with schools and colleges in an attempt to stamp out drug abuse in the county. He or she will liaise with Health Service workers and voluntary agencies. This relates to the point made by the hon. Member for Bolton, West (Mr. Sackville) about the involvement of parents in the attempt to curb drug abuse. Perhaps the advisory teacher can help in that area.
  My constituents welcome the Bill. I accept that it is part and parcel of a broad frontal attack by the Government on drug addiction and abuse and illicit importation. I urge the Government to seek better co-ordination among the resources of the DHSS, the Department of Education and Science and the Home Office so that the attack on this heinous problem—we listened with great interest to the hon. and learned Member for Fylde (Sir E. Gardner) recount his visits to the United States with the Select Committee—can be given greater force. We welcome the Bill and the Government's broad frontal attack on the problem. Teesside, which has the third largest port in the country, must not be missed out of that broad attack.
  9.39 pm
  Mr. Keith Raffan: When my private Member's Bill, now the Controlled Drugs (Penalties) Act 1985, was debated in Standing Committee I said:
  "The Bill does not provide a magical miracle cure for the highly complex, extremely serious and ever-growing problem of drug misuse. There are various aspects of that problem, including prevention, treatment and rehabilitation. The Bill covers just one aspect of deterrence, which is only one part of prevention. Anything we can do we must do."—[Official Report, Standing Committee C, 27 March 1985; c. 5.]
  This Bill covers a further crucial aspect of deterrence. My Bill was supported by all of the political groupings in the House and by every shade and faction within those groupings. This Bill deserves equal non-partisan support.
  There is, to me, no distinction between convicted drug dealers and those who are convicted of burglary or fraud. All gain financially from criminal activity. There is no difference between murder by heroin for financial gain and murder by shotgun in the course of a bank robbery. Neither the burglar nor the person who is convicted of fraud is allowed to keep the proceeds of his crime; nor should a drug trafficker be allowed to do so.
  The whole point of deterrence is to reduce the supply of drugs and thereby slow down the dramatic increase in the number of addicts. The measure of the problem can be
  270
  shown by referring to the notified figures of heroin addicts in 1984. The number was 6,611, a 324 per cent. increase on the figure for 1979, and notified addicts are just the tip of the iceberg. The number of regular users is much greater. The lowest estimate is about 60,000, rising, according to some estimates, to as many as 150,000.Recently in another place Lord Lane said:
  "Let us take even the lowest figure of 10,000 addicts in the country. It requires, at the lowest, £20 a day per addict to feed their addiction. That is £7,000 a year per addict. If one multiplies that by 10,000, that totals £70 million. Those figures can probably be multiplied by four. But whether it is £70 million or £280 million, that money has to come from crime."—[0fficial Report, House of Lords, 30 January 1985; Vol. 459, c. 660-1.]
  And that money goes, of course, to criminals.
  It is not surprising, therefore, that the Metropolitan police estimate that 23 per cent. of its targeted criminals are now involved in hard drugs. Ten years ago they would have confined themselves to armed robbery, but now they find that hard drugs are much more lucrative. Indeed, it has been shown that some of them profit by as much as seven-figure sums over a very limited period from the importation of drugs. It is clear that they will continue to do so unless they are deterred by the toughest possible system of penalties.
  It is true that the seizure of controlled drugs has increased dramatically—in the case of heroin from only 3·3 kilos in 1973 to 312 kilos in 1984. The seizure of increasingly large quantities of heroin is a tribute to the work and the efforts of customs and excise and the police.
  But the seizures only confirm the severity of the problem. Heroin purity is still high—47 per cent., on average, in this country, compared to only 7 per cent. in the United States. And the price of heroin is cheap. It is one of the very few commodities whose price has fallen in the last few years, by one fifth between 1980 and 1983. The combination of high purity and low price means a plentiful supply of the drug.
  The need for action is urgent. As my hon. Friend the Under-Secretary of State, for the Home Department said when the Bill was published last month:
  "even the risk of long prison sentences is acceptable to some if a life of affluence awaits them on release."
  We must ensure that it does not do so. We must not be diverted by legalistic controversy over the concept of the reversal of the burden of proof. It is not a novel concept; nor is it, as some have suggested, such a fundamental change in our criminal justice system. As we are all aware, it already exists in taxation matters. And Lord Denning has pointed out in another place that it is already established in English law, in the case of the chief constable of Kent and another in the Court of Appeal in 1983.
  Of greater concern to me is the implementation of the Bill and how effective it will be when it becomes law. When attempting to trace offenders' assets we will be dependent on close co-operation with foreign countries. Drugs are not only big business; they are international business. A major drug trafficker does not tend to have a large deposit account in the National Westminster bank down the road. He is among the most sophisticated of criminals and his money is laundered through a multiplicity of accounts in a multiplicity of countries, many of them far away.
  The Bill allows for reciprocal enforcement agreements with other countries so that an order by a British court can be enforceable against assets held overseas. I hope that during his closing speech the Minister will tell us how

  271
  quickly he expects such agreements to be reached after the Bill becomes law. Perhaps he can also tell us the current position on proposals for the new United Nations convention to deal with all aspects of international drug trafficking, and what progress is being made through the Pompidou group of the Council of Ministers on drug misuse. My right hon. Friend the Prime Minister raised the issue of drug trafficking at two recent internatinal conferences and I should be grateful if my hon. Friend could tell the House about the follow-through on those discussions. International co-operation is vital if the Bill is to be effective.
  I should also like to ask about the public service manpower effects of the Bill. As my hon. Friend knows, I welcomed the increase last year of 150 Customs officers specialising in drugs. I remember, as he will, that during the debate in Standing Committee on my private Member's Bill he said he would not hesitate to recommend a further increase if he thought it was necessary. This Bill allows for some 35 new customs and excise investigative staff which, it says, are
  "necessary to exploit the opportunities presented by the new legislation."
  I am well aware, as we said earlier in the debate, that the main thrust of customs effort is in intelligence, and that leads to some of the more spectacular seizures. However, I believe that there is a need for more random searches. Of the 36 million visitors to this country from abroad each year, only one in 100 can expect to be searched. Major drug traffickers are also becoming more adept at using the cover of commercial freight to ply their evil trade. I believe that customs policy at the moment is that only 2 per cent. of EEC goods coming into this country are examined, and that in terms of the total of all freight the figure is only 6 per cent.
  The hon. Member for Birmingham, Erdington (Mr. Corbett) spoke about private yachts. That is a serious problem, especially when in Chichester there are 6,000 in harbour, on the Hamble 4,000, and at Lymington another 4,000. The Society of Civil and Public Servants has said in a survey on the Hamble that an average of 60 yachts come in on Sunday nights and request Customs inspection. About the same number come in and do not bother to request it, but there are not even enough Customs officers at the moment to inspect the 60 that request inspection. Perhaps my hon. Friend could tell us how the figure of 35 extra Customs officers in intelligence was arrived at and why the Bill does not advocate more officers for random searches. After all, the additional cost of staff is likely to be offset by higher income from confiscation.
  The Select Committee on Home Affairs described drugs as
  "the most serious peacetime threat to our national well-being."
  It is indeed an insidious, all-pervasive threat that knows no boundaries of class or geography. It is no longer an inner city, a city, an urban or even a suburban problem. It is prevalent throughout our villages and our countryside. I represent a partly urban, partly rural constituency in north Wales. It is covered by the north Wales constabulary, and in that area we have seen a dramatic increase in drugs offences—from 292 in 1978, none involving heroin, to 956 in 1984, 522 of them, more than half, involving heroin.
  The hon. and learned Member for Montgomery (Mr. Carlile) quoted Justinian's article in the Financial Times which said that the Bill, if passed, will be
  272
  "one of the most fearsome pieces of legislation in modern times, both in the investigative powers it gives to public authorities and in its penal sanctions."
  That should greatly satisfy Ministers and officials in the Home Office. To me such a response is only too appropriate to such a serious threat to our national wellbeing.
  9.50 pm
  Mr. Greg Knight: We are dealing with an international problem which shows all the signs of approaching and remaining at epidemic proportions during the 1980s and the 1990s unless fairly drastic action is taken. Between 1974 and 1984, the number of reported drug addicts increased fivefold. The number of those receiving medical treatment trebled. The figures show that heroin imports have increased by some 640 per cent.
  The most frightening aspect of all is that the size of the problem, as illustrated by the figures, is only the tip of the iceberg, as my hon. Friend the Member for Delyn (Mr. Raffan) said, because the official statistics show only reported instances. Those who have tried to estimate the scale of heroin addiction have suggested that the number of addicts is over 60,000.
  I will not be as rash as the hon. Member for Liverpool, West Derby (Mr. Wareing) and claim to speak for every one of my constituents, but I am sure that the majority of them are behind the measure, as are the Derby Christian Trade Unionists who have shown a commendable interest in the subject.
  I thought the hon. Gentleman was a little ungenerous in his reference to customs officials. The emphasis of detection has changed somewhat and, as I understand it, increasing importance is being given to long-term intelligence work. While I agree with some of the points he made about the desire to increase the number of customs officers, it is fair not to overlook this other point.
  Britain can learn from the experience of the United States of America. America has been a dumping ground for drugs for a number of years and comparatively its problem is a lot worse than ours. I note that America has proceeded along the path that we are being invited to follow.
  I should like the Minister, when replying, to comment on one point. I understand that in America not only is it lawful for drug proceeds and the assets achieved from drug dealing to be forfeited but that that can be achieved by civil proceedings before a criminal conviction. Has my right hon. Friend given further thought to whether or not we should introduce a similar measure?
  The hon. Member for Birmingham, Erdington (Mr. Corbett) and my hon. and learned Friend the Member for Fylde (Sir E. Gardner) asked what will happen to assets confiscated by the courts. In America, a percentage of the assets seized goes to the general fund of the Treasury. However, the recent crackdown on drugs there has also proved profitable for the police because, as I understand it, some states in America offer an inducement to police authorities whereby a successful drug detection unit is sometimes allowed to keep a percentage of the assets for whose confiscation it has been responsible. I should like my hon. Friend to deal with that point.
  It seems that to some degree the success of the American legislation is based upon the motivation factor. That is a good Conservative principle—the principle of self-interest. If police squads are successful, they should

  273
  be able to have some share of the confiscated assets in terms of new equipment or perhaps an expansion of their departments. Will this happen, even to a small extent, in Britain when the Bill becomes law?
  Some hon. Members have expressed concern about the shift in the burden of proof. I know that the former right hon. Member for South Down, Mr. Enoch Powell, also expressed concern about this aspect of the Bill. I agree with my hon. Friend the Member for Delyn—I do not have any misgivings about this provision of the Bill. First, it applies only after conviction. I think that the successful business man, the successful pop singer or even the unsuccessful working man who has won a bonanza from a newspaper bingo game or has won money from any other source would have no difficulty in showing the actual source of the money.
  Secondly, it is not creating a precedent because—in areas of law which are substantially less serious, such as commercial law and some traffic offences — the principle does exist. When a motorist is stopped by the police, the burden is on him to show that he holds a licence, that his vehicle has an MOT test certificate and that he is insured. We are not creating a new principle although we may be extending the principle. This should be done, in view of the horrors of the drug problem, if we are to bring the guilty to justice and take the profit out of their crime.
  The drug problem, rather like the economy, has two sides to it—supply and demand. Some people suggest that all the Government can do is attack the supply side and try to prevent drugs from coming into the country. I disagree. Although it is important to see that drug hauls are intercepted, the demand side does need to be tackled. It is vital that the public, especially the young, are educated about the effects of drugs. There is a tendency—not just for the reasons of unemployment or social deprivation suggested by the hon. Member for West Derby —among some young people to experiment and a desire to try something out that is fashionable. They may hear of a pop singer admitting to taking drugs and think it is something to try.
  I must add my voice to the praise which has been given to my hon. Friend the Minister, the Member for Putney (Mr. Mellor)—much praise has been given to him this evening and earlier, I thought, from the look on his face, that he was getting rather worried about it. However, the praise is welcome and deserved. It is worth underlining the fact that the Government have made £8 million available to try to drive home to young people the dangers of drug abuse.
  It is not often that there is such consensus in the House as we see today. I hope that all Members will agree with the Prime Minister who, on 9 August last year, addressing her remarks to drug traffickers said:
  "We are after you. The pursuit will be relentless. The effort will get greater and greater until we have beaten you. The penalty will be long prison sentences. The penalty will be confiscation of everything you have ever gotten from drug smuggling."
  Let us all say "Hear, hear" to that.
  9.59 pm
  Mr. Jeremy Hanley: I hope that brevity will not be taken for lack of concern about this vital issue. The co-operation shown by both sides of the
  274
  House, which I hope will be demonstrated by suspension of the Ten o'clock rule, shows that the House is determined to support one of the most effective weapons in the fight against drug taking and peddling. It is a world war against drugs. We are in the middle of world war three, and it is as important and probably as costly in terms of lives as previous world wars.
  It being Ten o'clock, the debate stood adjourned.
  Ordered,
  That, at this day's sitting, the Drug Trafficking Offences Bill may be proceeded with, though opposed, until any hour. —[Mr. Lang.]
  Question again proposed, That the Bill be now read a Second time.
  Mr. Hanley: My confidence in the House is fully justified, and I am grateful for the unanimous vote.
  I was honoured to be a member of the Home Affairs Select Committee that went to America. We had seen the depths to which people can sink through addiction to heroin in Hong Kong and Amsterdam and we saw the same with regard to cocaine in the United States. We have seen exactly what our future will be, or is likely to be, unless the Bill is supported fully by the British public. It is supported by the House. It is now up to the public to ensure that it works. On our return from America, the hon. Member for Birmingham, Erdington (Mr. Corbett) said:
  "I fear I have seen the future, and I do not like it."
  That is exactly the mood of the Select Committee.
  I well remember going on the visit. Most of us went with smiling faces, looking forward to our visit to a foreign country. Our smiles were very quickly wiped off our faces when we saw the evidence of drug taking, what it can do to people, the extent of drug taking and the amount of money that can be made from this pernicious habit.
  I went with prejudices. I believed that marijuana, or cannabis, was possibly harmless and that perhaps it should be legalised—that at least we should consider that. I came away believing that marijuana is as dangerous as any other drug. It can lead to the harder drugs. It can lead to a mentality that accepts drug taking. Scientific evidence shows that, when mixed with tobacco, it can be as dangerous as any other cancer-inducing product.
  I believed that cocaine was relatively harmless, that it was bearable and that one might be able to kick the habit. I have now seen that that is not at all the case. Although, unlike heroin, it can be put aside for a month or two, the feeling of euphoria, great power, ease and confidence that comes with cocaine is addictive and eventually the drug itself becomes addictive. The physical signs of taking cocaine are even more horrible. It can destroy the nasal passages and cause people to have metal implants in their noses because it has burnt the inside away.
  I remember, as my hon. Friend the Member for Westminster, North (Mr. Wheeler) said, being in that small room in Miami surrounded by $10 billion-worth of drugs. That is almost twice as much as the budget for the Home Office, almost twice as much as the United Kingdom budget to the EEC and more than the budgets of the Department of Employment and the Department of Transport put together. It represents staggering power.
  Anybody could spend $1 billion on a small army and multiply the profits 10 times. That is why the place is so secret and so heavily armed. However, that $10 billion was the product of only six months of seizures in the

  275
  Miami area. It represents one tenth of the drug industry in America worth $100 billion. That is bigger than the gross domestic product of 14 out of 25 OECD countries.
  I learned a hard lesson in America. I learned that cocaine cannot be regarded as the champagne drug, as it is often called. I learned that it is the norm to take it at parties, especially among show business people. However, industry is also tainted by it. We even discovered that one of the representatives of the people, a Congressman, had been addicted to it but, now cured, tours the country telling of its evils. Anybody can be addicted to this drug once they have tasted it. In Pakistan, it has been discovered that two children of Cabinet Ministers are suffering from heroin addiction, and the authorities are clamping down effectively on the production of drugs, with the help of my hon. Friend the Member for Putney (Mr. Mellor).
  When one sees the activities of the drug traffickers and the couriers who bring drugs through Heathrow and other ports, one realises just what this can lead to. Drugs couriers carry drugs not only for money; they do it because they are threatened and blackmailed. There was the recent case involving the Nigerian lady who died when one of the 32 contraceptives containing heroin which she had been forced to take into her stomach exploded. That illustrates what people are forced to do. We know that she was forced to do it, because on her back were 32 razor cuts so that she would have to account for every one of the packages she had been forced to smuggle through. If that is the pressure under which people are put, it shows the evil of the drug for the world.
  With regard to the funds which are seized —admittedly very effectively in America, in the fight against drug traffickers — I do not believe that in the United Kingdom context they should be used specifically for prisons, for rehabilitation, for education or against the drug trafficker. I believe that every penny that is seized should be taken and put into the coffers of the Treasury. However, I believe that it is undeniable that we need to spend sufficient—or even more—on building prisons to house the traffickers, on rehabilitating those who have fallen prey to the drugs, on educating children so that they never go to drugs and against drugs traffickers in every way possible.
  The fact that the document "Tackling Drugs Misuse" was signed by seven Secretaries of State is an almost unique example of co-operation in Government in modern times. It is a document to be remembered, for the simple reason that one of those Secretaries of State was the Chancellor of the Exchequer himself. The Chancellor of the Exchequer should remember that, in signing that document, he signed a whole-hearted commitment to provide the funds to fight drugs. We need more than the proceeds of seizure of drugs to use against drug traffickers, and this money must be found.
  Some people say that the police have gone soft on drugs. From evidence put before the Select Committee on Home Affairs, I do not believe that to be so. I believe that they are waging an intelligent and effective war and are being more constructive and effective in their approach. I can say, after four meetings with Scotland Yard, that I have never seen a body of men and women so concerned about one issue.
  With regard to customs officers, of course numbers matter. If the numbers fall below what is needed to do the job effectively, then obviously drugs will come in. If
  276
  customs officers go on strike, as they have done in recent years, that is when drugs can flood into the country. This is particularly so when they announce that they are going to go on strike in advance, to gain extra industrial pressure. I wish that they would not go on strike because they play a vital part in stopping drugs coming into the country.
  Of course numbers matter, but I believe that the present numbers are about adequate. It is not numbers ultimately that make the difference; it is the intelligence that Customs officers receive, the training they have in drug-related matters, the co-operation with the police force, which I am glad to say is now better than it has ever been, and the cooperation with other services that are so important. It is being able to identify the drug trafficker, the courier and the transport that brings drugs into the country. I am glad that the customs service has, in Pakistan, a man who is doing such excellent work in passing intelligence back to this country, and about the spread of this service to other countries. Given the contacts that we have—both police and customs officers—diplomatic status is a tremendous benefit, and helps co-operation with other countries.
  This is one of the best and most interesting Bills that has ever been introduced in an attempt to stop one particular crime. I was proud that I was on the Committee and that all members of the Committee agreed to the seven parts of the interim report. I was pleased, and I hope that the Government would take notice. The Government have done more than that—independently, they have come to the same conclusions. My hon. Friend the Member for Putney has worked tirelessly. It is known that he is probably one of the hardest-worked Ministers in the Government, and this co-operation role is particularly difficult. Wherever the Select Committee went, he had been before. Instead of saying that we wished that the Government would see what we had seen, we knew that my hon. Friend the Minister had seen it first. He has learnt what we have and has come to the same conclusion.
  This is an excellent Bill. I wish that it were tougher on civil remedies, but that is my only criticism of it. I wish it fair speed.
  10.11 pm
  The Parliamentary Under-Secretary of State for the Home Department (Mr. David Mellor): It is a pleasure to be able to respond to such an interesting and absorbing debate, which has shown such a wide-ranging accord across the Floor of the House. I thank those who paid warm tributes to my efforts. I am touched by what has been said. It is a privilege for me to be engaged in this issue, which we all know to be of such profound significance to future generations. My right hon. Friends and I are glad that the Bill has achieved such wide-ranging support and that the points that have been made have been so constructive. We shall have the opportunity to look at them in Committee, where I am looking forward to playing a part in the proceedings.
  I am also glad that it has been possible to broaden the debate and to make some more general points about the overall problem and the work that we are doing to combat it. It is clear that, although this is a significant Bill, which represents a further major brick in the wall that we are building against the trafficker, the Bill alone cannot resolve the drugs problem.
  In a typically wise speech, my hon. Friend the Member for Westminster, North (Mr. Wheeler) made abundantly clear his view that there is no excape from the drug

  277
  problem down the law and order route, although we must make those services more effective in their battle against traffickers. The hon. and learned Member for Montgomery (Mr. Carlile) pointed out that escape comes through education and widespread recognition by the community that there exists no problem that drugs do anything but make matters worse. We must get more people to say no to drugs. The willingness of people to pay for and take drugs puts the pressure on, and creates the incentive for, the drug trafficker to find other, more complicated ways of avoiding authority. We must face the fact that in a free society there will always be ways to do that. We can never block off every route into the country.
  We have to make the law and order services ever more effective. The police and customs are now working together in the closest way — unparalleled in their history. They have never been better resourced to do this and the other jobs that they are asked to do. We talk in terms of raising several million pounds from the Bill, but we should not begrudge the Treasury that money, as expenditure on the police under this Government has gone up from £1·1 billion to £2·8 billion a year. The police service at every level— from the drug squads to the copper on the beat to the regional crime squads, increased by 20 per cent. as a result of announcements made in the summer, to the national drugs intelligence unit, headed by one of our most experienced policemen—is playing a full part in this with the customs.
  I do not want to get into detailed discussion at this hour about the customs position, but I should like to pay tribute to the work of the customs, as I did the other day when their seizure figures for 1985 were announced, showing just what a rich harvest their professionalism is reaping. The fact that they smashed 70 drug rings last year is a major achievement; and the fact that 1,500 people were arrested is also something for which we are all very grateful.
  The hon. Member for Birmingham, Erdington (Mr. Corbett) raised the point of uniformed preventive staff. I appreciate that there has been controversy about this matter. Certainly since my ministerial group was formed there has been a steady increase in the number of uniformed preventive officers, and there are more to come. My hon. Friend the Member for Delyn (Mr. Raffan) must not think that we are talking of only 35 extra officers in this context. Thirty-five extra intelligence officers relate to the work of this Bill. But I am happy to tell him, as my hon. Friend the Member for Derby, North (Mr. Knight) well knows, because this information was given in answer to his question, that in the two years from April 1985 to April 1987 it is proposed that the number of uniformed preventive officers, whose main priority is drugs detection, be increased from 2,823, as at 1 April 1985, to 3,300 by 1 April 1987—almost 500 more over a two-year period. By the same token, the number of specialist intelligence investigators dealing with the careful tracking of drugs conspiracies, the careful targeting of flights and of individuals, the profiling of suspects—which is such a help to uniformed officers — has increased already from some 121 to 262 and, as a result of reconsideration of the implications of this Bill, is scheduled to increase to some 297 by April 1987.
  We have also seen, in parallel with those increases, a great change in the sophistication with which customs are
  278
  able to tackle the drugs problem, in particular by being able to concentrate more not on the predictable checks —the red and green channels—but on the unpredictable checks. Anyone who has visited Heathrow as I have knows how much goes on apart from what one sees in the red and green channels; and rightly so.
  The greatest tribute to the customs, to the efforts that they are making, and the success that they are achieving, is what was reported by Mr. Lawrence, the chief investigation officer, a few weeks ago, when he said that smugglers were no longer generally bringing their drugs on the direct route into the country; they recognised that that was now very well targeted and they were taking ever more complicated and tortuous routes around Europe. There are, of course, the particular problems of other continental countries where the law and order services are perhaps less effective, particularly the Netherlands, where drugs can be warehoused and run into the United Kingdom in containers, lorries and cars. This poses, however many men there are and however well disciplined they may be, an almost insuperable problem.
  Some points of detail have been raised to which I really ought to refer. Some of them reminded me a little of what Richard Strauss said about conductors: "There are those who take the music too fast and there are others who take the music too slow." Some hon. Members think that some provisions go too far; others think that some do not go far enough. We have tried to strike a balance between the two extremes.
  Our friend Justinian says that it is a ferocious piece of legislation. I gather that "Justinian" masks a well-known progressive thinker whose lines of thought are not always in keeping with those of the man on the top of the Clapham omnibus. If we have offended him, I do not suppose that it is for the first time. I do not think that there is anything particularly ferocious about the Bill in the sense that we are taking unprecedented powers. What we are doing is trying to take from other areas of the law, particularly the civil law, things that have worked well, like the Mareva injunctions and the vigorous investigations by the high Court masters. We have tried to ensure that they are put at the service of the criminal law so that we do not repeat the mistake that parliament made in 1971. At that time section 27 appeared to the layman to give a clear power to seize assets. However, because it was not sufficiently thought through and did not have a mechanism to make it enforceable, it led to the Operation Julie case, and the present hopeless distinctions between the man with the drug money hot in his pocket which can be confiscated, and the man who has invested money on the stock exchange in Westland shares, or whatever takes his fancy, which cannot be seized under the law. If in 1971 someone had suggested that that would be the effect of the legislation, no one would have believed it. That was the effect, and that is why we have worked so hard to get the right answer, stimulated by the work of the Home Affairs Select Committee to whose chairman and members I pay tribute.
  The reason why we decided not to adopt the American example of civil proceedings was that we did not think that it could fit readily into the British system. The power is draconian and would have appeared out of sorts with anything that we have hitherto done, because it gives authorities the power to seize property, if they have reasonable suspicion that it has been acquired illegally. Then the individual who claims to be the owner is put to

  279
  proof. Without having been convicted of anything, it is up to him to establish that the property was lawfully acquired. If we had proposed that, I suspect that more than Justinian would have spoken of ferocity, and they might have been right.
  Mr. Alex Carlile rose—
  Mr. Mellor: I am receiving some instructions suggesting that I should not give way, but I shall.
  Mr. Carlile: Before the Minister leaves the question of applications to freeze assets altogether, will he explain why the Government have not decided to introduce provisions which would enable the police to apply ex parte for the freezing of assets before arrest? That would be an effective power in their hands. Moreover, it was recommended by Hodgson.
  Mr. Mellor: We provide for that in the sense that once a warrant for arrest is issued, it does not have to be executed. At that point the police can go to the High Court judge, before the individual knows that he is about to be arrested, and persuade that judge to grant the injunction. We have sought to balance every power that has been given with a safeguard, because that is the proper way to proceed. If the Committee takes the view that it would be better if the power to freeze were not linked to arrest, we would be receptive to that point.
  It is important that we seek a balance. In striking it we reached the conclusion that this was the proper way to proceed. This major innovation in criminal law had to be balanced by evidence on which an arrest warrant had been issued, or on which an arrest without a warrant had taken place, and by the approval of a High Court judge.
  Regarding the receipt of funds, a large sum has been invested in our campaign against drugs, and the extent of it is well set out in the publication, "Tackling Drug Misuse". I hope that the Chancellor of the Exchequer will not be begrudged the money that will be received as a result of this measure considering the Government's large expenditure on combating the problem.
  I am grateful to colleagues who have taken part in the debate. I hope that those who have spoken so eloquently with such an obviously detailed knowledge of the problem and such a commitment to its eradication will join us in
  280
  Committee. We have tried to think the Bill through, and to ensure that we give the courts a readily understandable, workable power which will result in drug traffickers losing the proceeds of their evil activities. This proposal, like all the others that come before the House, must be looked at rigorously. No doubt, it can be improved. I hope that those who have spoken so well tonight will join in improving it.
  My hon. Friend the Member for Southampton, Test (Mr. Hill) was right to remind me about the problem of others who are making money out of crime. My hon. Friend is particularly concerned about those involved in vice. He believes that they should be subject to the rigours of these proposals. We have a commitment which we intend to carry through in the Criminal Justice Bill, which we hope will find a place in the Government's legislative programme next Session, to legislate more widely on the subject of the seizure of the assets of the criminal fraternity. It is a matter for judgment on which we welcome comments, as to how far the principles in the Bill should be carried across into the law more generally I accept the warning that my hon. and learned Friend the Member for Fylde (Sir E. Gardner) issued, but I know the pressure that colleagues like my hon. Friend the Member for Test are under from their constituents who are troubled by the amount of money to be made out of vice. I can assure hon. Members that their message has not fallen on deaf ears.
  Question put and agreed to.
  Bill accordingly read a Second time, and committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).

  DRUG TRAFFICKING OFFENCES BILL [MONEY]
  Queen's Recommendation having been signified—
  Resolved,
  That, for the purposes of any Act resulting from the Drug Trafficking Offences Bill, it is expedient to authorise—

  (a) any increase attributable to the Act in the sums payable under any other Act out of money provided by Parliament, and

  (b) any increase attributable to the Act in the sums payable into the Consolidated Fund under section 61 of the Justices of the Peace Act 1979.—[Mr. Donald Thompson.]

  Mrs. Sybil Gordon
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Donald Thompson.]
  10.36 pm
  Mr. Jim Lester: I am pleased to have the opportunity at a comparatively reasonable hour to refer to the constituency case of Mrs. Sybil Gordon and the advice she received from the Nottingham probate office. This is one of those cases on which a Member feels so strongly that he continues—this is the fifth time I have applied for an Adjournment debate since 5 November—to press for a hearing in this ultimate Chamber, the House of Commons. I welcome this Adjournment debate because this matter needs to be settled. It covers events that have taken place since 1982. I have made at least three attempts in correspondence with the Lord Chancellor, in addition to Mrs. Gordon's efforts, to solve this problem.
  Mrs. Gordon's experience is by any standards a real tragedy in that her son Malcolm David Cameron Gordon and her grandson, Gerald David Gordon, aged seven, died together in a road accident in June 1982. Her son, who had been divorced and had not remarried, died intestate along with his only dependant. At this time, Mrs. Gordon needed help and support during what we would all recognise was, by any standards, a dreadful tragedy.
  Luckily, a friend of the family, a retired auditor, Mr. Harold Lipman, helped to sort out the legal position regarding Mrs. Gordon's son's estate, especially in terms of paying his funeral expenses and debts. Mr. Lipman has proved a valuable witness to the course of events which he described in a letter to me dated 30 May 1985 in response to the first refusal that I had from the Lord Chancellor to consider this case, based on the fact that the Nottingham probate office does not give legal advice. The probate office not only gave her advice up until the last contact with the Ipswich probate office, who gave Mrs. Gordon's daughter-in-law the correct advice two years later, but continued to maintain its original position that she could not make a formal application for settlement of her son's estate, when in fact this was the correct legal position. As Mr. Lipman stated in his letter, the basis for Mrs. Gordon's complaint against the probate office is that she made a claim in 1982 to the Nottingham probate registry for the purpose of taking out letters of administration to settle her son's estate. It is clear that the advice she was given at the time was that she was not allowed to do so. She was told that only her grandson's mother could do this and that the estate had nothing to do with her.
  Mr. Lipman states that Mrs. Gordon, whom he had known for many years as a retired teacher, had made an accurate statement to the probate office of the circumstances when she asked permission to take out letters of administration on her son's estate. He confirms that, within a week or so of Matthew's death, he spoke to the Nottingham probate registry describing all the relevant circumstances. The lady to whom he spoke informed him that Georgina, the son's former wife, would inherit the estate via her small son, Joe, and that she was the person who needed to register the letters of administration. He says that she was definite about that.
  Some time later, Mrs. Gordon was understandably distressed because the estate was still not being administered and the undertakers were asking for payment
  282
  of the funeral expenses which she had guaranteed. Mr. Lipman, as a neutral person, spoke to the Nottingham probate registry. He spoke to the same lady who, he said, was quite short with him, saying that the estate had nothing whatever to do with Matthew's mother. It concerned only the ex-wife through her young son. This corroborates the correspondence that I have had from Mrs. Gordon. I have deliberately referred to Mr. Lipman's letter because I believe that he was a neutral observer.
  In 1984 when, Mr. Lipman went with Mrs. Gordon to the probate office, two years after her son's death, the official who had dealt with the application said that the lady who had given the advice had left the probate office to be a senior registrar in Manchester. She was therefore still known and traceable.
  The basis of the Lord Chancellor's rejection of Mrs. Gordon's claim of harassment, difficulty and distress has been that the registry staff has no responsibility to give legal advice. The registry staff may say, "It is not our business to give legal advice. We should advise you to go to a solicitor. We can give you guidance on how to register a complaint." That is reasonable. It is clear that, in this case, from the beginning, the probate registry staff told Mrs. Gordon and Mr. Lipman that there was no question of Mrs. Gordon being able to register the letters of administration.
  Over a period of two years, Mrs. Gordon suffered considerable distress because her relationship with her former daughter-in-law deteriorated. The former daughter-in-law's solicitor notified Mrs. Gordon that he was trying to get the superannuation available to her via the young boy and that settlement of the estate would depend on whether the ex-wife gave the nod. The solicitor told Mrs. Gordon in no uncertain terms that she had no claim on the estate.
  I must point out that Mrs. Gordon was seeking no claim on the estate in a material sense; she was merely distressed that her son's estate was not being cleared according to the law and concerned about whether his debts were being properly paid. Subsequently, the former daughter-in-law changed her solicitor. The new solicitor applied on her behalf to the Ipswich probate office for the letters of administration.
  He was given what has subsequently turned out to be the correct advice which was that the ex-wife had no claim on the estate because the grandson was under 18 years of age and the only person who could settle the sad matter was the mother.
  When Mr. Lipman and Mrs. Gordon returned to the Nottingham probate office, the staff confirmed that they remembered the case. When Mrs. Gordon told them the advice she had been given by the Ipswich probate office, they refused to believe it. It was finally left that the Nottingham probate office would ring the Ipswich probate office to corroborate the correct legal advice. That was two years after the event. Immediately after that they invited Mrs. Gordon and Mr. Lipman to come to the Probate Office and take out letters of administration to settle the difficult and sad matter. Mrs. Gordon had faced two years of misery in finalising her son's estate.
  It is clear that after two years people have forgotten the advice they were given and it is difficult to trace those who gave the advice. However, I submit that there are not many cases submitted to probate of such gravity, where a person loses both her son and grandson in a road accident. It is clear from Mr. Lipman's evidence of the approaches that

  283
  he made that when Mrs. Gordon approached the Nottingham probate office she was given clear advice that she had no claim on the estate and she was not encouraged or allowed to register her case which eventually proved just and legitimate.
  Having suffered the long period of distress and difficulty and having lost the relationship with her ex daughter-in-law, Mrs. Gordon feels aggrieved. If she had been given the correct advice, or even no advice at all and told that it was not the role of the probate office to advise or suggest any course of action and that she should consult a legal adviser who was knowledgeable in complicated matters of probate law, the matter may have been settled more easily. That was not the case. I am satisfied that all the correspondence I have seen and the events I have described to the House are accurate.
  There may be a secondary case that Mrs. Gordon did consult a solicitor in Beeston who gave her the same sort of advice as the probate office. Therefore, it was not unreasonable for Mrs. Gordon to proceed with energy to finalise the problem when on two occasions at the Nottingham probate office, on one occasion from a solicitor and under pressure from her ex-daughter-in-law's solicitor, she was given the wrong advice. I am convinced that if she had been told to seek advice from a legal adviser or if the probate office had taken the trouble to consult its own legal records, as the Ipswich probate office did, the subsequent trouble and distress would have been avoided.
  I understand why people who are not qualified—that certainly covers the probate office — should not give legal advice in such cases. As I understand the principle established by the case of Hedley Byrne and Company Limited versus Heller and Partners Limited, it is not unreasonable, when officials or officers are seen to have special knowledge of the law, and are seen by laymen to be in that position, to expect them to understand that the advice they give is likely to be accepted and that they should be held responsible for it. I submit to my hon. and learned Friend that this case is clearly within that principle. It seems to be beyond doubt that the Nottingham probate registry was not advising Mrs. Gordon on how to complete the necessary forms. Instead, it was advising her on her legal position as it saw it. That continued for over two years until it verified by telephone the alternative legal advice that was given by the Ipswich office.
  I contend that it would be reasonable for the Lord Chancellor to accept that in addition to the grave tragedy of losing both a son and a grandson, which few of us can envisage, Mrs. Gordon suffered sadness and distress, and unnecessary distress, over two years in the settlement of her son's estate.
  In this case there have been at least three applications to the Lord Chancellor and much correspondence to him as well as this Adjournment debate. Against that background, I ask my right hon. and learned Friend whether the case could not be reopened and considered in the light of the circumstances that I have spelt out to the House, with a satisfactory solution arrived at for Mrs. Gordon in view of the great sadness and distress which she has, in my view, suffered unnecessarily.
  10.41 pm
  The Solicitor-General (Sir Patrick Mayhew): My hon. Friend the Member for Broxtowe (Mr. Lester) has brought to the attention of the House a complaint made by his constituent, Mrs. Gordon, which concerns the staff of
  284
  Nottingham probate sub-registry. My hon. Friend, as all who know him would expect, has shown great assiduity in furthering the cause of his constituent and her desire that her grievance should be considered further and should find redress.
  The matter comes within the departmental responsibility of my right hon. and noble Friend the Lord Chancellor and I, accordingly, have been asked to respond on his behalf. My hon. Friend has outlined the sad circumstances and events which befell members of Mrs. Gordon's family in June 1982. It is impossible to hear of them without great sympathy for Mrs. Gordon on that account.
  Mrs. Gordon's son died intestate and his estate therefore devolved in accordance with the rules relating to intestacy, which are set out in section 46 of the Administration of Estates Act 1925. Her son had been married and had one seven-year-old son, but was divorced in May 1979. That meant that his former wife could not have inherited his estate directly. At the time of his death he had not remarried. Mr. Gordon's only child died in the same terrible accident in which he himself perished.
  For the child to inherit his father's estate, he would have had to have survived his father until he reached his 18th birthday, or have married before attaining that age. As the little boy was only seven when he died, Mrs. Gordon was by law the only person who was entitled to inherit her son's estate. She was, therefore, the only person who was entitled to obtain a grant of letters of administration to his estate.
  After the tragic death of her son and grandson in 1982, Mrs. Gordon was helped by a Mr. Lipman. As my hon. Friend has said, Mr. Lipman is a professional man. He is a retired auditor and a friend of the family. He telephoned solicitors in Mansfield and was told that Mrs. Gordon's son's estate would pass to his former wife via their son, Joel.
  That advice was based on the assumption that the so-called law of commorientes—that is, persons who died apparently simultaneously with one another—applied in this case. That law, as now contained in section 184 of the Law of Property Act 1925, concerns the situation in which two or more persons die on the same occasion in circumstances in which it is not possible to ascertain who died first, as in a fatal car accident. In cases in which this doctrine applies, the persons who have died are deemed to have died in order of seniority—that is, the oldest first and the youngest last.
  The law of commorientes, however, was irrelevant in the circumstances of the deaths of Mrs. Gordon's son and grandson because at the time of his death Mrs. Gordon's grandson was only seven years old and therefore could not have inherited his father's estate at all. The estate therefore could not pass via the little boy to his mother. If the solicitors' advice was as stated, it was therefore misleading. Mrs. Gordon was the only person entitled to her son's estate.
  Mr. Lipman subsequently telephoned the Nottingham probate registry and he says that he was told that Mr. Gordon's former wife was the only person entitled to his estate. Mrs. Gordon then contacted the solicitors and was advised to make an appointment at the Nottingham registry. It is not possible now to establish exactly what was said to Mrs. Gordon by the registry staff or what information she supplied to them. It is clear, however, that

  285
  after her attendance at the registry Mrs. Gordon believed that her former daughter-in-law was the only person entitled to her son's estate.
  Some time after she visited the probate registry, Mrs. Gordon was again told by solicitors that she was not entitled to benefit from her son's estate. She has stated in a letter that she did not attend the probate registry to obtain legal advice. It is therefore reasonable to assume that it was because of the advice given to her by solicitors that she refrained thereafter from making a formal application in 1982.
  Mrs. Gordon eventually obtained a grant of letters of administration in June 1984. The basis of her complaint is that she has suffered by reason of her acceptance of advice that she says was given to her by the staff of Nottingham probate registry.
  As my hon. Friend fairly acknowledges, the staff of district probate registries are not solicitors but civil servants employed by the Lord Chancellor's Department. They may advise members of the public on the procedure relating to grants of probate or letters of administration, but they must not give legal advice and they are not qualified to do so—that is the function of solicitors or barristers. Not only is it not the responsibility of registry staff to give legal advice, as my hon. Friend has said, but they are instructed that they are not to do so and it is therefore their duty not to do so.
  Owing to the passage of time, it has not been possible to establish clearly what was said by the staff of the
  286
  probate registry to Mrs. Gordon or even what information she gave to them about the personal circumstances of her son at the time of the accident. It is clear, however—and it is only fair to acknowledge this—that there is no reason to doubt the good faith either of Mrs. Gordon or of Mr. Lipman. Mrs. Gordon may well have been left under the impression that one or other of them—either she or Mr. Lipman — had been given well-intentioned but wrong advice which confirmed the advice that she had been given by two firms of solicitors.
  The Lord Chancellor is not and cannot in the circumstances be convinced that the registry staff exceeded their duties and, therefore, he cannot accept liability in this matter. Nevertheless, he is willing to instruct his officials to consider the complaint once again. If Mrs. Gordon is willing to discuss the matter with them, arrangements will be made for those officials to consider her complaint afresh with a view to reaching a solution which would be satisfactory to her.
  I am grateful to my hon. Friend for having raised the matter. I know that he has tried to do so on at least a couple of occasions, and I hope that the suggestion that I have made, on the authority of the Lord Chancellor, will satisfy him and will demonstrate to Mrs. Gordon that her Member of Parliament has effectively brought the matter before the House of Commons, and that that has led to a further inquiry into her understandable grievance.
  Question put and agreed to.
  Adjourned accordingly at nine minutes to Eleven o' clock.