RACE RELATIONS MATTERS

HC Deb 14 December 1987 vol 124 cc828-67

'—(1) Except to the extent permitted by subsection (2) below, section 71 of the Race Relations Act 1976 (local authorities to have regard to need to eliminate unlawful racial discrimination and promote equality of opportunity, and good relations, between persons of different racial groups) shall not require or authorise a local authority to exercise any function regulated by section 17 above by reference to a noncommercial matter. (2) Subject to subsection (3) below, nothing in section 17 above shall preclude a local authority from—

1. (a) asking approved questions seeking information or undertakings related to workforce matters and considering the responses to them, or
2. (b) including in a draft contract or draft tender for a contract terms or provisions relating to workforce matters and considering the responses to them,

if, as the case may be, consideration of the information, the giving of the undertaking or the inclusion of the term is reasonably necessary to secure compliance with the said section 71. (3) Subsection (2) above does not apply to the function of terminating a subsisting contract and, in relation to functions as respects approved lists or proposed contracts, does not authorise questions in other than written form. (4) Where it is permissible under subsection (2) above to ask a question it is also permissible to make, if it is in writing, an approved request for evidence in support of an answer to the question. (5) The Secretary of State may specify—

1. (a) questions which are to be approved questions for the purposes of this section; and
2. (b) descriptions of evidence which, in relation to approved questions, are to be approved descriptions of evidence for those purposes;

and the powers conferred by this subsection shall be exercised in writing. (6) Any specification under subsection (5) above may include such consequential or transitional provisions as appear to the Secretary of State to be necessary or expedient. (7) In this section— approved question" means a question for the time being specified by the Secretary of State under subsection (5) above; "approved request for evidence" means a request for evidence, of a description for the time being specified by the Secretary of State under that subsection in relation to an approved question; workforce matters" means matters falling within paragraph (a), but no other paragraph, of subsection (5) of section 17 above; and any expression used in this section and section 17 above has the same meaning in this section as in that section.'.—[Mr. Ridley.]

Brought up, and read the First time.

The Secretary of State for the Environment (Mr. Nicholas Ridley)

I beg to move, That the clause be read a Second time.

Madam Deputy Speaker

With this, it will be convenient to discuss the following: New clause 6 — Contracts— compliance in relation to public supply or works contracts— '(1) It is the duty of every public authority to which this section applies, in exercising in relation to its public supply or works contracts, any proposed or any subsisting such contract, as the case may be, any function regulated by section 17 to exercise that function with reference to the enforcement of the law by any appropriate agency and the promotion of equality of opportunity in employment. (2) The public authorities to which this section applies are those specified in Schedule 2 to this Act. (3) The contracts which are public supply or work contracts for the purposes of this section are contracts for the supply of goods or materials, for the supply of services or for the execution of works. (4) A local authority may in pursuance of the functions regulated by this section, have regard to any of the following:

1. (a) the terms and conditions of employment by contractors of their workers, the arrangements for the training of their workforces, or the employment (in the case of an inner city area or region of high unemployment) of a reasonable percentage of their workforce from among the local unemployed which shall be determined by the authority;
2. (b) the actual or potential membership of contractors of industrial, trade or professional associations, technical guarantee schemes or any other associations or schemes pertaining to their competence to perform the contract;
3. (c) in co-operation with the relevant local employment office, the employment by contractors of disabled people in accordance with the Disabled Persons (Employment) Act 1944.

(5) In this section, any term defined in section 17(8) below shall having the meaning thereby ascribed to it. (6) In this section, 'inner city area' and 'region of high unemployment' shall have the meanings set out by the Secretary of State in regulations. (7) The provisions of sections 17 to 21 shall have effect subject to the provisions of this section. (8) This section shall have effect from the date of Royal Assent.'.

New clause 7— Contracts compliance in relation to public supply or works contracts (Race relations provisions) `(1) It is the duty of every public authority to which this section applies, in exercising in relation to its public supply or works contracts, any proposed or any subsisting such contract, as the case may be, any function regulated by section 17 to exercise that function with reference to the enforcement of the law by any appropriate agency and the promotion of equality of opportunity in employment. (2) The public authorities to which this section applies are those specified in Schedule 2 to this Act. (3) The contracts which are public supply or work contracts for the purposes of this section are contracts for the supply of goods or materials, for the supply of services or for the execution of works. (4) A local authority may in pursuance of the functions regulated by this section, have regard to any of the following:

1. (a) the country or territory of origin of supplies to, or the location in any country or territory of the business activities or interests of, contractors or associated bodies where it may be reasonably necessary to the pursuance of its duties under the Section 71 of the Race Relations Act 1976;
2. (b) observance of the Race Relations Act 1976, and in particular, the carrying out by the authority of its duties under Section 71 of that Act.

(5) In this section, any term defined in section 17(8) below shall have the meaning thereby ascribed to it. (6) In this section, 'inner city area' and 'region of high unemployment' shall have the meanings set out by the Secretary of State in regulations. (7) The provisions of sections 17 to 21 shall have effect subject to the provisions of this section. (8) This section shall have effect from the date of Royal Assent.'

New clause 9—Race Relations Matters. (No. 2)— `Section 71 of the Race Relations Act 1976 is hereby repealed.'.

Amendment No. 9, in page 14, line 3, leave out clause 17.

Government amendment No. 10.

Amendment No. 11, clause 18, in page 17, line 1, leave out subsections (1) to (3).

Government amendment No. 14.

Amendment No. 15, in page 17, line 43, leave out subsection (9).

Amendment No. 16, in page 17, line 43, after '(10)', insert 'and (10A)'.

Amendment No. 17, in page 18, line 1, leave out subsection (10).

Amendment No. 18, in page 18, line 7, at end insert— `(10A) Nothing in Section 17 above shall preclude a Local authority from doing by reference to a non-commercial matter any act in the exercise of a function regulated by Section 17 above if the matter falls within paragraph (a) (but no other paragraph) of subsection (5) of that Section and the doing of the act is reasonably necessary to secure that the function is carried out with due regard (a) to the need to comply with the Disabled Persons (Employment) Act 1944.'.

Government amendment No. 20.

Amendment No. 21, in page 18, line 12, after '(10)' insert 'and (10A)'.

Government amendment No. 22.

Amendment No. 23, in page 18, line 17, after '(10)' insert 'and (10')'.

Amendment No. 24, in page 19, line 22, leave out Clause 20.

Government amendment No. 25.

Amendment No. 31, schedule 6, in page 47, line 8, at end insert— '1976 c. 74 Race Relations Act 1976 Section 71'.

Mr. Ridley

In view of the interchange which we have just heard, it would be wise for me to leave it to hon. Members on both sides of the House to advance their arguments for the amendments and new clauses. I shall seek to reply to the debate at the end, but, in the meantime, I shall simply move the new clause.

This new clause and the consequential amendments fulfil an undertaking given by my hon. and learned Friend the Minister for Local Government during the Standing Committee's consideration of the provisions in part II of the Bill, which deals with the supply and works contracts of public authorities.

As at present drafted, the Bill contains an exemption —in clause 18(10)—which allows authorities to carry out their contractual function with due regard to the need to eliminate unlawful racial discrimination. This is in recognition of the statutory duty placed on local authorities by section 71(a) of the Race Relations Act 1976. However, local authorities also have a statutory duty under section 71(b) of that Act to secure that their various functions are carried out with due regard to the need to promote equality of opportunity and good relations between persons of different racial groups. We have received many representations to the effect that authorities should be allowed to carry out their duty under both section 71(a) and section 71(b).

As my hon. and learned Friend recognised in Committee, there is force in the argument that nothing in the Bill should prevent authorities from carrying out their existing statutory duties. Limiting the exemption in clause 18(10) to authorities, section 71(a) duty fails to meet that principle.

In order to remedy this, we have tabled this new clause dealing with the way in which local authorities should carry out their section 71 duties within the contractual process. The Race Relations Act requires local authorities to have regard to race relations matters when exercising their various functions. In accordance with undertakings given by Ministers to the effect that nothing in the Bill will prevent authorities carrying out existing statutory duties, I believe that we should now seek to recognise the duty placed on local authorities by both parts of section 71.

However, we have to consider very carefully how the Bill could be amended in a way that does not permit abuses of the section 71 duty, such as that suggested in the Opposition's new clause, nor must it impose excessive burdens on contractors.

Hon. Members will see that the new clause proposes that authorities should be allowed to ask written questions about race relations practices relating to the noncommercial matters in clause 17(5)(a).

Mr. Tony Marlow (Northampton, North)

Is my right hon. Friend saying that, in this day and age, the Government really believe that local authorities should have a duty to promote equality of opportunity, and good relations, between persons of different racial groups in contracting companies used by local authorities; in other words, not within their own labour force but within other people's labour forces? If my right hon. Friend believes that, will he tell us how we should avoid a massive ding-dong and contention between local government and the people it seeks to employ?

Mr. Ridley

I like to respond to any speech made by my hon. Friend the Member for Northampton, North (Mr. Marlow). However, we are proposing this course, which will allow local authorities to perform their statutory duties, yet, at the same time, prevent them from exploiting or abusing those opportunities because of the procedure which I am describing to my hon. Friend. If he will bear with me, he will see that there is logic in what I say.

Sir Nicholas Bonsor (Upminster)

That is precisely why I am pursuing this point. The Secretary of State has said that there is nothing in the Bill which will prevent local authorities from carrying out their statutory duties. I entirely agree with him. But will he tell the House how the Bill would prevent local authorities from carrying out their statutory duties when they would be at liberty to do so?

Mr. Ridley

I hope that I may call my hon. Friend "my hon. Friend". He did not extend that courtesy to me. The purpose of the Bill is to prevent local authorities from abusing the contractual process, but we do not seek to contradict or override any statutory duty under any other Act of Parliament. In other words, we approach the Bill without using it as a way of amending any other piece of legislation or affecting any other responsibility that has previously been placed on local authorities. I am sure that my hon. Friend will agree that, if he seeks to make such changes, the right place is not in this Bill.

Mr. Marlow

Why not?

Mr. Ridley

It is simply designed to fit local authorities' tendering procedures to the law as it stands in relation to other matters.

Mr. Budgen

Will my right hon. Friend give way?

Mr. Ridley

I have already given way to my hon. Friend. We seem to be having a microcosm of a debate during my formal speech presenting the Government's amendments.

Mr. Budgen

Since my right hon. Friend has to admit that new clause 9 is in order and that, indeed, other provisions in other Acts are repealed by the Bill, it is not good enough simply to say that it would not be appropriate. Will my right hon. Friend please explain why he believes that it is desirable to retain section 71? He clearly has the opportunity, if he wishes to do so, to repeal it today.

Mr. Ridley

I am not for one moment questioning your decision, Madam Deputy Speaker, that the clause is in order. That is not part of my case, and I have never said that it is. My hon. Friend has put his argument, and I shall respond to him at a later stage. I merely want to explain what the Government are proposing so that my hon. Friend may consider whether it meets what he wants.

If it is reasonably necessary for local authorities to ask written questions about race relations practices in pursuance of their duty under section 71(a) and (b) of the Race Relations Act 1976—but only if such questions are in a form that is specified by the Secretary of State—we shall cut out the abuse of section 71. I am sure that that point is in the minds of many of my hon. Friends. Authorities would be allowed to take account of the answers to questions in exercising their contractual functions prior to entering into a contract, but they would not be able to terminate a contract on race relations grounds. By specifying the questions to be asked, we shall enable authorities to fulfil their duties without imposing too excessive a burden on contractors, who, until now, have been faced with different questionnaires from different authorities. Some questionnaires have been extremely long and gone into quite unreasonable detail.

Mr. Marlow

Will my right hon. Friend give way?

Mr. Ridley

I have said that I shall not give way any more. I am looking forward to hearing my hon. Friend's speech. I have given way three times already. However, I shall give way to my hon. Friend.

Mr. Marlow

My right hon. Friend has said that the burden would not be too excessive. How long is the process likely to take? How burdensome is the burden going to be? On a specific point, my right hon. Friend is going to bring forward a list of questions that can be asked. Will he discuss the questions with the Commission for Racial Equality before they are brought forward?

Mr. Ridley

I shall certainly discuss the questions with the Commission for Racial Equality, local authority associations and anybody else who has an interest in such consultation. At the moment, I envisage about four or five questions. My hon. Friend will agree that that is fewer than I have here. I have the Sheffield city council department of employment and economic development questionnaire. Its pages are not numbered, but it is getting on for 100 pages to be filled in. It would take several months' work to supply the amount of information that is required. It is standard issue from Sheffield city council, and in future it will not be allowed. Indeed, the council will be allowed to ask only the questions that I have set out. The consultations will take place as soon as possible so that authorities can take account of the approved questions once the Bill is enacted.

The drafting of the new clause achieves a sensible balance between the two points of view that have been expressed on both sides of the House. There will be those who claim that local authorities will not be able to exercise their section 71 duty in ways that they would like, and there will be those who claim that section 71 has no place at all in the contractual process. The clause fulfils our undertaking in Committee to amend the Bill in a manner that does not permit abuse of duty and does not impose excessive burdens on contractors. I commend it to the House.

Dr. John Cunningham (Copeland)

First, the good news, which is that, by this clause, the Secretary of State is not only embracing but, in effect, nationally codifying a major aspect of Labour policy. I am talking about contract compliance. I have absolutely no problem about congratulating the Government on having the good sense and open-mindedness to adopt what is, after all, a radical interventionist policy. Many Labour councils that have been busy implementing contract compliance as a means of furthering equal opportunities employment are paid a great compliment by the Secretary of State, because—make no mistake about it—contract compliance as a policy for advancing equal opportunities was first introduced in this country by the Labour-controlled Greater London council. It has since been exclusively pursued and developed by Labour councils.

However, the Government's policy on contract compliance is confused and contradictory. Clauses in the Local Government Bill to outlaw non-commercial considerations appear to have been introduced for two reasons: first, in response to pressure from a narrow group of employers' associations, who wish to keep the employment practices of some of their members from public scrutiny, and, secondly, as a reaction to an ill-informed tabloid press campaign about local authorities imposing "political conditions" on contractors.

The debate on part II of the Bill in Committee revealed that contract compliance is a serious policy that has been widely followed in the United States of America.

Mr. Eric Forth (Mid-Worcestershire)

Does that make it good?

Dr. Cunningham

The hon. Gentleman may intervene if he wishes to do so. He asked, "Does that make it good?" In the home of free enterprise and market forces, contract compliance and equal opportunities are a normal part of commercial activity. Any major organisation in the public or private sectors of the United States of America would almost certainly have an equal opportunities manager. The hon. Gentleman asked whether that is a good thing. It is a good thing. It has made major advances in the United States of America for employment opportunities for women, for people from black and ethnic communities and for people with disabilities. We on the Opposition side regard that as important social progress.

Mr. Forth

Does the hon. Gentleman say that the Labour party is looking to the United States for examples of contract law, labour law and other laws? Does he wish us to emulate the United States right across the range of these matters or is he just being highly selective?

Dr. Cunningham

No. The hon. Gentleman cannot crawl out of the black pit that he is in by way of an intervention such as that. The reality is that it is a civilised way in which to provide equal opportunities for people. That is what the United States has found. We are saying that we in this country, particularly those in inner-city areas, can learn lessons from that. I understand that it is the Government's intention, and even that of the hon. Gentleman, to try to aid inner-city areas during the next few years of their tenure of office. However, in case the hon. Gentlman is in any doubt, we need not even look to the United States of America. We need only to look to the Northern Ireland Office of this Government and to the right hon. Gentleman the Secretary of State for Northern Ireland, who has followed exactly that course in announcing that it is the Government's intention to legislate on equal opportunities in Northern Ireland. That is exactly what the Government intend to do. I can go further and tell them that the Institute of Personnel Management's independently commissioned study entitled "Contract Compliance—the U.K. Experience" finds that contract compliance is not only useful as a means of fair employment practices with respect to recruitment, selection and training, but also makes good economic sense.

The Government's own policy document on Northern Ireland reiterates the commonly held belief. It states: Equality of opportunity in employment is a vital concern in Northern Ireland. The document goes on: It is essential for economic prosperity and fundamental to a democratic society. That was said by another Cabinet Minister — the Secretary of State for Northern Ireland. Will Conservative Members support it in the case of Northern Ireland, or will they oppose it? Hon. Members say that it is wrong. It seems that in the new year there will be all sorts of revolts, objections and divisions in the Conservative party on those issues.

7.30 pm

That point seems to have been lost on the Minister for Local Government who said in Committee: Equal opportunities policies are normally regarded as social matters. Commercial matters are matters directly relevant to the contractual process — for example, competence, capacity and cost — while other matters, irrelevant to that process, are properly described as non-commercial."—[Official Report, Standing Committee A, 17 November 1987; c. 780.] I ask the Minister, who is right: he or his right hon. Friend the Secretary of State for Northern Ireland who said that those matters are essential for economic prosperity and fundamental to a democratic society. That illustrates the absolute confusion of the Government on those important matters.

Mr. Marlow

The hon. Member is looking for evidence of consistency between the Front Bench and my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) and myself. He should remember that in Committee my hon. Friend the Minister of State said that Local authorities should not be in the business of setting themselves up as extra-statutory enforcement agencies on matters that are already the subject of existing statute and which already have, where appropriate, their own enforcement processes."—[Official Report, Standing Committee A, 17 November 1987; c. 793.] The hon. Gentleman will be aware that section 4 of the Race Relations Act 1976 deals with all those matters and there is no need for local government to be involved at all.

Dr. Cunningham

I am grateful to the hon. Member for Northampton, North (Mr. Marlow) for that intervention —I do not often say that to him. What he said is true, and it will be interesting to see whether the Minister of State votes for new clause 5. He will have to decide whether the Committee is right or whether what his right hon. Friend has just said is right.

The Secretary of State for Northern Ireland said: Equality of opportunity in employment is a vital concern in Northern Ireland. It is central to personal dignity, to the best use of individual talent and to business efficiency. I applaud the right hon. Gentleman for saying that. He is absolutely right and Opposition Members can only regret the utter confusion, mentioned by the hon. Member for Northampton, North, between the Front Bench and the Back Bench and inside the Cabinet on these matters.

The Government have tried to hide their embarrassment by terminological wrangling. When faced with the incompatibility of their two policies, the Minister with responsibilities for industry in Northern Ireland, the Parliamentary Under-Secretary of State for Northern Ireland, the hon. Member for Gosport (Mr. Viggers), said: We don't accept contract compliance. What we're saying is that if a company wishes to win an order from Government it must first have obtained the Certificate of Practice which says and confirms that it operates fair practices within its company. We regard 'tender acceptance', together with 'grant denial' as the way ahead, and for technical reasons, as I've explained, we don't accept contract compliance. I can tell the right hon. Gentleman that local authorities, particularly Labour local authorities, would be happy to call their policies "tender acceptance". Of course new clause 5 does not go far enough, because although it tries to deal somewhat narrowly with the race relations aspects of this matter, it totally ignores sexual discrimination, and the position of women and equal opportunities. It flies in the face of the view of the Equal Opportunities Commission. The hon. Member for Torridge and Devon, West (Miss Nicholson) noticed that, because she tabled some positive amendments on that issue. I look forward to hearing what she has to say. The Equal Opportunities Commission has made that clear on more than one occasion.

I am sorry that the Secretary of State is not interested in the development of careers for women—the majority of the population in Britain. That is quite obvious because he has totally ignored them in new clause 5. The Equal Opportunities Commission said to the Secretary of State and the Home Secretary that the right of women should be included in exactly the same way as they are dealt with in section 17 of the Race Relations Act and that a similar duty as exists within the Sex Discrimination Act should be provided by the Government.

Perhaps worst of all is the Government's attitude in excluding people with disabilities from their amendment. The Government rejected the amendments designed to ensure that contractors uphold their duties under the Disabled Persons (Employment) Act 1944. One of the saddest aspects of the matter is that it will hit hardest a section of the population who are already at a considerable disadvantage in the job market—people with disabilities.

That can easily be illustrated with reference to the experience of Labour-controlled Lambeth council, an authority whose attempts to put into effect equal opportunities for people with disabilities has been successful. In May 1986, the London borough of Lambeth decided not to seek exemption from its quota of 3 per cent. registered disabled people under the 1944 Act. The council was successful in recruiting more than 200 people with disabilities who were fully able to do the jobs on offer. Compulsory competitive tendering puts such progress and achievement in jeopardy. The Government know that, yet they turn their face against the reality and pretend that no such problems or risks exist. Failure to amend the Bill will almost certainly result in the job prospects of people with disabilities being severely diminished.

The Commission for Racial Equality, while it welcomes the Government's new clause, regrets that the Secretary of State has reserved to himself the power to set the questions and to define the evidence that may he sought. The commission considers it desirable that there should be regard to local variations. It says: In the Commission's view the wording in clause 18(10) as originally drawn provided sufficient safeguards by entrusting the Courts with redress and protection against unreasonable demands. As a fail-safe device the Commission could ultimately have invoked its code-making powers in the employment sphere (S. 47 Race Relations Act 1976) which provides for extensive consultation followed by ministerial and parliamentary approval. The Minister has chosen to ignore all that, because he wants to do as little as possible commensurate with meeting his statutory obligations. I cannot say that we are particularly enamoured with what the Secretary of State proposes to do. We are not opposed to it, but it does not go half far enough. I can hardly do better than quote what Baroness Platt, the chair of the Equal Opportunities Commission, said in a letter of 24 September which was sent to various organisations. She wrote: The Equal Opportunities Commission is very concerned at the effect this measure will have on achieving equal opportunities for women. In practice employers will be likely to give priority to measures which will influence whether or not they obtain contracts, thus dimishing, to a considerable degree, the importance they give to sexual discrimination. Equally seriously, the Government will have appeared to endorse these priorities. We share Baroness Platt's view.

I hesitate to suggest that the Minister for Local Government was misleading the Committee when he said that the Government would not allow sex discrimination into the Bill because, unlike race, there was no existing statutory duty which applied significantly to local authorities. He said that if the Equal Opportunities Commission was to ask for such a power, it would be considered. It has asked for exactly that power and, apparently, having considered it, the Government have decided not to grant it. That is the inescapable conclusion to be drawn from what the Secretary of State said. I am not surprised that the right hon. Gentleman moved new clause 5 because his junior colleague is so confused—and so are the Government—that he would be hard pressed to make a speech which did not contradict what he has already said in Committee.

As if that were not enough, we should consider what the Chancellor of the Duchy of Lancaster said when he appeared on "Weekend World" in an interview with Mr. Matthew Parris. He dealt with the ministerial excuse about the limitations being necessary because of Community law. Mr. Parris asked: Reading between the lines, are you saying that the EEC problems can be confined to one narrow area of contract law"? The Chancellor replied: I think I am more or less saying that. I think the so called EEC problem is a very narrow legal point. I don't think there's any inhibition in finding other ways of providing local training, local jobs out of all other activities, the building activities, the opening of new business, encouraging of new business that the government is going in for. So there we have yet another Cabinet Minister expressing yet another view.

Mr. Simon Hughes (Southwark and Bermondsey)

Does the hon. Gentleman agree that, when we explored this in Committee and in correspondence afterwards, it has been made clear that there is no express prohibition of the type of contract compliance facility we are arguing for and that European law is there to be moulded if the Government take the initiative? Does he agree that there is nothing to stop the Government? There is no case law and no decision which expressly prohibits anything for which we are arguing.

Dr. Cunningham

I broadly agree with the hon. Gentleman. The truth is that the Government do not want to act in respect of equal opportunities for women or for people with disabilities and they are doing the minimum required to keep on side with the Commission for Racial Equality.

Mr. Ridley

Does the hon. Gentleman agree with the hon. Member for Southwark and Bermondsey (Mr. Hughes) that European law, or, for that matter, any other law, is there to be moulded? That would seem to be a thought too liberal for him or me to accept.

Dr. Cunningham

I said that I broadly agreed with the hon. Member for Southwark and Bermondsey (Mr. Hughes). The substantive point, regardless of the words that the hon. Gentleman used, is that we have an opportunity in the Commission to take advantage of opportunities such as these. The hon. Gentleman said that we should set the standards in Europe, and I share that view. It is disgraceful that, on matters of human rights and dignity, once again, Britain is lagging behind the rest of Europe and the United States.

Will the Secretary of State stand by what he said? What is his real conflict with the Home Secretary in these matters? What will the Department of Employment's role be? How will the confusion end? Different Ministers are swanning around the country making promises to all sorts of people about more employment in inner cities and equal opportunities in Northern Ireland, yet this Secretary of State is legislating against what they are doing. There can be no greater confusion and no greater hypocrisy.

The limitations envisaged in new clause 5 are quite unnecessary. It would be far more sensible for the Government to accept new clause 6. The Government could then go wider when dealing with these matters, which are important to many millions of our fellow citizens. That is the Labour party's stance and why we tabled new clause 6. That is what we shall be voting on.

7.45 pm

Mr. Budgen

The Labour party is in a fortunate and, tonight, united position. It believes in interventionist laws and that, by using the law, sometimes the criminal law, the views of ordinary people can be changed. It has long been consistent on this issue. It voted for the Race Relations Act 1965, the Race Relations Act 1968 and the Race Relations Act 1976. It has been a consistent supporter of what the hon. Member for Copeland (Dr. Cunningham) calls the human rights issue, as exemplified by the various Race Relations Acts.

It is hardly surprising that, while many of my hon. Friends and even some of my right hon. Friends will have little difficulty voting against the Opposition's new clause 6, they may conclude that the Government's stance is somewhat confused. My right hon. Friend the Secretary of State is in a peculiarly embarrassing position. No doubt he voted in 1965 and 1968 against the Labour party's legislation, just as the remainder of the Tory party did, but he was one of only six Tories who, on 4 March 1976, voted against the Race Relations Bill receiving a Second Reading.

Those of us who felt strongly enough to say that we wanted no part of that nonsense did so because we believed that the Bill would grant special rights to a minority community.

Mr. Bernie Grant (Tottenham)

What rights?

Mr. Budgen

The protection of the Race Relations Act. The hon. Gentleman should know that the position of that minority has not been improved by the existence of the Race Relations Act. Indeed, it has made the presence of that minority more resented than it would otherwise have been, because many people believe that the Act confers special rights and privileges on a minority who are identified mainly by the colour of their skin. That must have been the view of my right hon. Friend when he voted with me and others on 4 March 1976.

The Tory party has to come to terms with nonsense. It will often carefully and pragmatically nurture nonsense to its breast to give a happy attitude to what some Opposition Members would call the march of progress.

Those who wish to say that they would like to accept a bit of nonsense and wish not to be seen as rejecting too much, showing themselves to be practical, and capable of understanding the exigencies of everyday politics, should understand that if we repeal section 71 of the Race Relations Act 1976 there will still be left in place all the activities of the Race Relations Commission.

I invite those who have a spare moment to obtain a copy of the 1976 Act. It is apparent from part VII that the Commission for Racial Equality has a considerable role to play. Indeed, I must concede that in recent years it has seen which way the wind is blowing and has not been as assertive or aggressive in the pursuit of its powers as it was immediately after 1976. Therefore, it may be that the commission can be described as a tolerable nuisance. I assert that intolerable are the activities of local authorities in pursuit of section 71.

Many Labour Members regard the black community as a captive interest group—

Ms. Diane Abbott (Hackney, North and Stoke Newington)

Rubbish.

Mr. Budgen

Yes, there are those who take that approach. They believe that by speaking constantly in terms of idealism that is based upon a concept that is enshrined in the American constitution and in American legislation they will be able to continue to claim the adherence of the black community to the Labour party. I believe that they do the black community a great disservice. I believe also that they are deeply patronising to the many members of the black community who are making or who have made their way in our society without the benefit of any special privilege.

In Wolverhampton — —[Interruption.] — we have experience of what the hon. Member for Hackney, North and Stoke Newington (Ms. Abbot) and other Labour Members would describe as an active and progressive race relations industry. It campaigns most vigorously on behalf of the Labour party.

Mr. Marlow

I would just like to point out to my hon. Friend, in case he did not hear the seated interjections, that the hon. Members for Hackney, North and Stoke Newington (Ms. Abbot) and for Tottenham (Mr. Grant) both take the view that the job of a local council community relations organisation is to get rid of Members of Parliament that it does not like. This is an interesting development.

Mr. Budgen

I am grateful to my hon. Friend, because the council for community relations in Wolverhampton has emerged publicly in a dramatic way on three occasions during the period that. I have had the honour to represent Wolverhampton, South-West. There have been two serious incidents of civil disturbance, and in each the officials of the council for community relations have, far from trying to calm things down, exacerbated the tension and made public statements to the effect that the activities of the police are not to be trusted.

As I have said, I am grateful to my hon. Friend the Member for Northampton, North for drawing attention to the remarks of Labour Members about getting rid of Tory Members.

Ms. Abbott

Racist Members, not Tory Members.

Mr. Budgen

Racist, yes—exactly.

During the previous Parliament, I was a supporter of the Government's proposals to restrict immigration. During the general election, the council for community relations issued a pamphlet, which was financed by the ratepayer, to the effect that the Government's immigration policy was racist and that any candidate who supported those racist policies should not be supported. That is a reasonable point of view for the Labour party to put forward. As it happened, the Labour party had become so much associated with the activities of the council—that had done it a considerable amount of harm with a large section of the white community — that it tried to dissociate itself from the council's activities.

That did not stop the council for community relations. I say to those of my hon. Friends who are prepared, to stomach a bit of nonsense, but not all of it, that if we want to have a race relations industry it is probable that the Commission for Racial Equality is rather more impartial and capable of understanding in a sensitive way the case for obtrusive legislation, as I would describe it, than the various organisations of local government.

I hope that many of my right hon. and hon. Friends will vote against the Government's new clause, which I consider to be dangerous. Everyone knows that there is a fundamental battle within the Government over contract compliance. I had forgotten that when I had a recent interview with my right hon. and learned Friend the Government Chief Whip, but it was said in Committee that, when he had ministerial responsibilities for immigration, he appeared on television and said that he was in favour of contract compliance.

Mr. Jeff Rooker (Birmingham, Perry Barr)

I referred to that in Committee.

Mr. Budgen

The hon. Gentleman is right. Perhaps it was his words that I read in the report of the consideration of the Bill in Committee. The Home Office is in favour of contract compliance and it may be that the Department of Employment is. It may also be that my right hon. Friend the Secretary of State has attempted to limit the effects of section 71(b) as much as possible. I dare say that he believes that the new clause, especially subsection (5), will limit the effects of section 71.

The issues that my right hon. Friend the Secretary of State has the right to define can be changed by him without them being brought before the House. Even a Minister of this Government who took a different view of contract compliance could make considerable changes, and a Minister of a different party and Government could change them substantially. I say to my hon. Friends, who may be confused by the welter of advice that is an inevitable consequence of the views that have rocked our party over the past 20 years, that if they vote against the new clauses that are before us, we can do that which we desire, which is to repeal a bit of the nonsense with which we are now confronted.

I say to those who are men of principle but of not too much—men of principle who want to demonstrate their soundness by being prepared to accept a bit of nonsense — that we are not attacking all the race relations nonsense — [HON. MEMBERS: "Why not?") My hon. Friends ask, "Why not?" I merely suggest that we can take a useful bite at it by getting rid of section 71.

Mr. Jack Ashley (Stoke-on-Trent, South)

I do not propose to mention race relations, nor do I intend to speak half as long as the hon. Member for Wolverhampton, South-West (Mr. Budgen) because there are many hon. Members present, all of whom wish to contribute to the debate.

On the problem of disability, I want the Government to go further than new clause 5 and to accept new clause 6 in the name of my hon. Friend the Member for Copeland (Dr. Cunningham). Disabled people face serious discrimination. Figures have already been mentioned by my hon. Friend but the actual figures are even worse than the official figures. Many disabled people simply give up and cease looking for jobs because of prejudice and discrimination. The number of people who face prejudice from employers is far greater than is commonly supposed. That is one major reason why we should have contract compliance.

8 pm

It is not just the figures that show the extent of discrimination but the personal experience of disabled people. I have received letters from people who have applied for jobs. It is a very disheartening experience. Some people have told me that they have made over 100 written applications for a job. Because they have been honest and mentioned that they have a disability, they either get no reply or they get a reply simply saying, "thank you". When disabled people change tack and decide not to mention their disability when they apply for jobs, if they get an interview, the moment the employer sees that they have a disability they are rejected.

Disabled people are in a no-win position. They cannot win if they are honest when they apply for jobs and they cannot win if they do not mention the disability, because at interview they are seen to be disabled. It is the outright prejudice against the disabled which is unforgiveable. Not all employers, but far too many, refuse to consider applications for jobs by disabled people. That is why we need contract compliance.

Why do employers take such a view about the disabled? The main reason is ignorance. They are ignorant of the abilities of many disabled people. They do not appreciate that if the disabled are put in the right jobs they can do just as good a job as a non-disabled person. Even if they are put in jobs to which they are not suited, the fact that they are disabled means they are anxious to please and they work harder and more assiduously than many people who are not disabled. Therefore, disabled people are a good bargain for employers if only the employers realised it.

It is not just ignorance but downright prejudice that prevents disabled people from getting jobs. Some employers simply do not want to know. They are not interested and they do not want to cope with the problems of accommodating disabled people, but that is covered by legislation. The Disabled Persons (Employment) Act 1944 was passed specifically to help the registered disabled. That is the most neglected Act on the statute book. It is disregarded more than any other Act of Parliament. The Government help with its evasion and connive in its neglect. They connive in law-breaking by refusing to prosecute employers who break the law. Employers do not break the law by not fulfilling the quota of 3 per cent. That is just neglect. They break the law if they have not got a permit from the Department of Employment for not fulfilling the quota and then take on a fit person. Thousands of employers are breaking the law today by doing that.

If we park our cars on a double yellow line or if we have a few drinks and drive our cars we are rightly prosecuted for breaking the law. I am in favour of that. But when employers break the law by flouting the provisions of the Disabled Persons (Employment) Act they are not prosecuted. That is disgraceful.

What can we do? What weapons are there in the pitifully inadequate armoury of the disabled? The best weapon is contract compliance. The fit for work scheme is helpful and the persuasion which the Government try is splendid, but neither of those is adequate. We need contract compliance. That is a vital weapon in the armoury of the disabled.

My hon. Friend the Member for Copeland mentioned Lambeth. That local authority has fulfilled its employment quota of 3 per cent. disabled. I went to Lambeth for the celebration. That is a marvellous achievement. Lambeth is the only local authority which has 3 per cent. disabled people on its books. It has done that by contract compliance.

If the Government are not prepared to accept new clause 6 the disabled will suffer even more discrimination and loss of jobs. New clause 5 will be helpful but it does not do enough. We must have new clause 6. I hope that the Secretary of State will think again, accept new clause 6 and give a better chance and more opportunities to the disabled to get the jobs that they badly need.

Mr. Robert G. Hughes (Harrow, West)

I welcome the new clause proposed by my right hon. Friend the Secretary of State. I believe that it will be welcomed by a number of groups. As has been indicated on both sides of the House, it will be welcomed by the Commission for Racial Equality not just because it is a quango that has specialised in this sphere but because it understands the problems and the work done by local authorities. The new clause will be widely welcomed by many black and Asian people who also understand the work done by local authorities. It will be welcomed by many supporters of the Conservative party and by many Conservative councillors who do much work to ensure that local authorities make a contribution.

We are not talking just about contract compliance, although that is the major thrust of the debate. The promotion of equality of opportunity and good relations between persons of different racial groups is important in many towns and cities. Conservative as well as Labour councillors recognise that need and work hard towards that end.

Mr. Marlow

Can my hon. Friend explain to the House how it is that local authorities intervening in the internal affairs of companies under contract to them will help to bring about racial harmony?

Mr. Hughes

If it was not that my hon. Friend asked that question I would say that I had never heard such a silly suggestion. As it is, I will not say that. [Interruption.]

Mr. Budgen

My hon. Friend has made the joke; he should now answer the question.

Mr. Hughes

I am happy to answer the other points that are made from a sedentary position. If hon. Members are seriously suggesting that in a mixed racial community or indeed in an area where there are a majority of Asian people—[Interruption.] the racial mix was not reflected in the work force in the area, and that that would not have some impact on good race relations, I would consider that hon. Members had not understood what we are debating today.

'The Opposition spokesman, the hon. Member for Copeland (Dr. Cunningham), said that there was logic in my right hon. Friend the Secretary of State's action. However, he went on to attempt to extend that logic to sex discrimination and discrimination against disabled people. The logic was described exactly by my hon. and learned Friend the Minister for Local Government in the Standing Committee. There is a legal framework for what is suggested within new clause 5. By accepting new clause 5, we are protecting the status quo. Indeed, we are improving it with regard to the powers that my right hon. Friend the Secretary of State will take.

I agree with much of what was said by the right hon. Member for Stoke-on-Trent, South (Mr. Ashley). We need to consider the problems of disabled people. We must take a much wider look at the severe problems of people who are intelligent and who can make a vital contribution to society, but who are denied that opportunity simply because they are disabled.

It is right for Opposition Members to claim that Lambeth has a good record in connection with the disabled. The council may not be able to run a housing department, and it may be dreadful at everything else that it does, but I accept—as I have witnessed its work—that it has brought hope to many disabled people. The council should be commended on its work in that area. The Government should attempt to expand much more widely the experience of councils such as Lambeth. Although this may not come under the remit of the Local Government Bill, all employers should treat the disabled in that way and, if necessary, should be forced to do so.

I welcome new clause 5 because it matches the assurances given during the general election campaign, when we made it clear that we would honour our assurances. New clause 5 matches assurances that were given during the campaign. Indeed, it matches an assurance given by my right hon. and noble Friend Lord Young, the Secretary of State for Trade and Industry, in another place on 21 July 1987, when he said in response to a question: I assure the noble Lord that there will be nothing in it"— "it" being the Bill— to prevent the operation of the Race Relations Act"—[Official Report, House of Lords, 21 November 1987; Vol. 448, c. 1338.] I am delighted that that assurance will be kept. In addition, an assurance was given in Committee by my hon. and learned Friend the Minister for Local Government and new clause 5 matches that assurance.

I said earlier that we are improving the present position. I believe that the powers that the Secretary of State will take are very wise. It is right that we should lay down precisely the framework that local authorities can use to carry out this important work. I welcome the assurance given from the Dispatch Box that the Commission for Racial Equality and the local authority associations will be consulted before my right hon. Friend the Secretary of State comes forward with his views. Local authorities have a good record in this area, irrespective of party. Some have misused their powers, but that is no reason why we should throw everything away.

I listened carefully to the points made by my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) about his local community relations council. I do not disagree with anything that he said about the council. However, we are not talking about that. We are concerned with what local authorities can do, what they have clone and the importance of their being able to act in future. My hon. Friend the Member for Wolverhampton, South-West referred to new clause 9. If new clause 9 was passed without consultation or public and open debate about the merits or demerits of the new clause, that would be dangerous.

Mr. Marlow

Surely there has been no public consultation about new clause 5.

Mr. Hughes

Removing the status quo by passing new clause 9 would be dangerous. In response to my hon. Friend's sedentary intervention, surely we are protecting the status quo. We do not need public consultation to protect the status quo. I thoroughly welcome the Government's action and I applaud them for their bravery in bringing forward new clause 5, which is most welcome.

Mr. Bernie Grant

If I had walked into the debate during the contribution from the hon. Member for Wolverhampton, South-West (Mr. Budgen) I would have thought that we were debating the Race Relations Act 1976, not the Local Government Bill. I believe that the hon. Gentleman's speech was a thorough disgrace. His was one of those speeches which tries to justify racism, and the House should thoroughly reject it. He referred to voting in 1976, but his contribution reminded me of 1876, when there were no black people within these shores. Perhaps he wants to return to that position. I made a pledge long ago that I would not debate with racists and I will not answer points made by the hon. Member for Wolverhampton, South-West or any of his hon. Friends on that issue.

8.15 pm

We are debating the Local Government Bill, which is aimed at centralising local government. Under the Bill the Secretary of State will take additional powers from local government. That is a very dangerous trend. The theme running through the Bill is that the Secretary of State sitting in Marsham street in his bullet-proof, bomb-proof, people-proof office is more aware of the needs of particular areas and how best to meet those needs than the locally elected councillors. That is the basis of the Bill.

It is built on the false premise that some Labour-controlled local authorities have stepped out of line and done a few naughty things and as a result the Government had to introduce the Bill to bring them back to the path of righteousness and reason. During the debate, we consistently asked the Minister and his colleagues for evidence of that abuse of local government powers, but we were not given chapter and verse for those so-called abuses. We must conclude that the abuses lie in the mind of the Secretary of State and his Ministers.

The Bill should really be called the "Local Government (Strangulation) Bill". It is aimed at strangling local government by giving powers to the Secretary of State which historically belong to local authorities.

Mr. Irvine Patnick (Sheffield, Hallam)

The hon. Gentleman referred to the historical nature of the powers of local government. Does he agree with the argument that I subscribe to, that all local government powers come from this place? They have not dropped as tablets of stone from heaven.

Mr. Deputy Speaker (Mr. Harold Walker)

Order. I remind the hon. Gentleman and the House that we are debating specific amendments. This is not the time to make speeches which might be more appropriate on another occasion, such as on Second Reading.

Mr. Grant

It is necessary for us to set the debate within the context of the present situation. I thought that you, Mr. Deputy Speaker, were very lenient to allow the hon. Member for Wolverhampton, South-West to stray so far from the subject under debate. However, I accept your point and I will bring my thoughts back to the Local Government Bill.

It will take a virtual army of civil servants to monitor the workings of the Bill. I want to consider contract compliance and the relevant clauses in the Bill.

I want to concentrate on the Bill's effect on black people and other ethnic minorities who are under enormous pressure, especially in inner-city areas. Since 1979, the Government have done nothing to alleviate the plight of the many hundreds of thousands from ethnic-minority communities. Black people are four times as likely to, be unemployed as their white counterparts, and those who are employed are in the most low-paid and menial jobs. They suffer the worst housing, education and health care, and they have the worst chances in life of any group in society.

Mrs. Elaine Kellett-Bowman (Lancaster)

Will the hon. Gentleman give way?

Mr. Grant

No. I will not give way.

All that is due to racism. What have the Government done—

Mr. Marlow

I wonder, Mr. Deputy Speaker, whether it is part of Standing Orders that if anyone in this House disagrees with the hon. Gentleman he is by definition a racist. That is what the hon. Gentleman seems to be saying.

Mr. Grant

The Government have done nothing since their election in 1979 to eliminate racism and the need for the fight against it. That is despite warnings in the reports by Lord Scarman and Lord Gifford, the report "Faith in The City" by the Church of England and similar reports by the Roman Catholic Church and other bodies. In the absence of any Government initiative, local authorities have been forced to compensate for the lack of it by introducing measures to combat the racism that is inherent in our present society.

Local authorities have listened to the ethnic minority communities in their areas, and have realised that the only way out of the vicious circle of deprivation is to give those people fair access to employment. Over the past few years, they have painstakingly developed ways of providing access to jobs. Contract compliance measures and local labour clauses in particular have been a key instrument to achieve that end. Through contract compliance measures, local authorities have been able to monitor the performance of contractors and the number of people from ethnic minorities in their work forces. That policy has succeeded in increasing the employment prospects of a substantial number of such people, not least because the authorities must themselves set an example by employing a multiracial work force.

Initially, the Bill proposed to divest local authorities of any power that they had to influence contractors' willingness to employ people from ethnic minorities. So outraged, however, were organisations such as the Greater London Association for Racial Equality, the Commission for Racial Equality and churches of all denominations that the Minister, in an embarrassing climbdown, had to amend the clause. As a result, we have new clause 5 before us.

I shall not be as generous as my hon. Friend the Member for Copeland (Dr. Cunningham) in welcoming new clause 5, because, basically, it will give more power to the Secretary of State. The new clause will allow him to specify what questions an authority may ask of contractors, bearing in mind that the authority's own money is involved. Contractors are taken on by local authorities with local ratepayers' money, and they have an absolute right to ensure that that money is not used to prop up racism.

The clause allows the Secretary of State what evidence an authority may require of a contractor. It gives him powers to make other unspecified provisions, as he may think necessary or expedient. Given the performance of this Government, and particularly that of the Department of the Environment, on equal opportunities, I venture to suggest that we can expect those powers to be abused in ways that will inhibit, rather than facilitate, the advancement of black employment opportunities.

The clause is another example of the Secretary of State taking more and more powers to himself and away from local authorities. I remind the House of the bureaucracy that will have to be set up to monitor all the goings-on in local authorities. Perhaps that was what the Secretary of State meant when he talked of "thought police" before the last election.

Another matter of great concern to me is the Government's outlawing of local labour clauses. Through such clauses, local authorities have tried to ensure that those who pay rates benefit in employment terms from the way in which they are spent. Too often, especially in the inner cities, local authorities spend millions of pounds on capital projects, the benefit of which goes to people living outside the area. There is the obscene situation of contractors bringing workers from affluent areas in the morning into an inner-city area of deprivation, perhaps to set up buildings there, only for everyone to pack up at 5 o'clock and go home to their luxury houses in the suburbs. That is deplorable.

In areas such as mine in Tottenham, we take such matters very seriously, because we believe that local labour clauses should be used first and foremost to try to ensure that disadvantaged young people — particularly young black people—have an opportunity of employment. We have found that, when such people have the opportunity to build some of the places in which they will live and work, there is little or no vandalism. That applies to the Broadwater Farm estate, and to other areas in Tottenham.

The London borough of Haringey has commented on the problem. We learned that Birmingham city council had introduced and initiated the local labour issue by requiring some contractors to employ some 30 per cent. of their employees from their particular catchment area. We said that we would employ one in six of our labour force from the catchment area, a figure that is slightly below the local unemployment figure. Since we have done that, we have had no problems with the contractors. Since July of this year, when the clause was introduced, 17 tenders have been returned, valued at some £14 million. Four contractors have asked for extra money for employing local labour. The total extra cost was about £8,000, or 0.06 per cent. of the total contract value to date.

On the Broadwater Farm estate, we took that a bit further, and carried out a skills audit. We therefore knew precisely what skills the residents had to offer the contractors. We told the contractors that they were required to take on people from the estate to between 30 and 50 per cent. of their work force. Our action was justified: as a result, some 150 young people have now gained employment on the estate, many employed by the local direct labour organisation. The result is that we have seen young people on the estate walking around with some expectation of work. There has been a tremendous response to the positive effort of the local authority to ensure that young people had an opportunity of work that they did riot have previously.

The Bill tries to outlaw that welcome development. In Committee, the Minister hid behind EEC regulations on this matter. If the Government were serious about employing local people—in inner cities in particular—and serious about tackling unemployment, particularly among young black people, should they not support the local labour clause and argue the toss with their partners in the European Parliament and the European courts? That would be the honourable course of action for the Government, but yet again an initiative taken by local authorities to alleviate deprivation in their areas is being smashed by the Government.

8.30 pm

One of the most pernicious aspects of the Bill is the clause that deals with local authorities' ability to refuse to buy South African goods and to refuse to give contracts to companies that have links with South Africa. The Bill talks about contract compliance and privatisation, but it is such a mish-mash that it is difficult to say what the worst clause is, but this one takes the biscuit.

For some years, some local authorities that are morally opposed to the regime in South Africa have said that they will not buy South African goods or have dealings with companies that live off the blood and sweat of black people in South Africa. That principled position was taken by some local authorities as long as 20 years ago. This reactionary Government are trying to stop local authorities from determining whether their ratepayers' money should be used to prop up apartheid in South Africa. It is a disgraceful clause in the Bill.

Local authorities spend millions of pounds every year on goods and services. Local authorities have a right to decide in which companies ratepayers' money should be invested, the origin of goods that they purchase and who should receive contracts from them. My borough, along with others, has been pleased to make clear its opposition to apartheid. Some years ago we passed a resolution, in line with those from other authorities, deploring the apartheid regime in South Africa, which kills and maims black people. We said that we should have nothing to do with it or its products. That policy has been supported by black people in South Africa and we receive regular bulletins from people who are struggling against apartheid in South Africa urging us to take sanctions against South Africa. Yet when local authorities try to do so, the Government step in and stop them.

In my constituency, a large proportion of people come from the black and ethnic minority communities. It is alleged to be over 50 per cent., but we are unable to say accurately what the figure is. However, it is certainly over 40 per cent. of the population; and they find apartheid repugnant and deeply offensive. They think that they should try to do the best they can in their own way by asking the local authority not to buy goods from South Africa. They have every right to do so, and the local authority has every right to respect those views. They do not want the local authority to force their children to eat apples or grapes from South Africa. If the Bill is passed unamended, people who have a conscientious objection to eating South African goods will be forced to do so because, by ruling out so-called non-commercial considerations, apartheid would not be a matter that an authority could take into account.

I want the Secretary of State to say what his position is on this matter.

Mr. Tony Banks (Newham, North-West)

It is hypocritical.

Mr. Grant

It is a hypocritical position. The Government say that they are opposed to apartheid, yet a clause in the Bill is directly aimed at assisting the racists in Pretoria. It brings Pretoria in from the cold internationally by forcing local authorities and others to trade with it. I want the Secretary of State to answer that point specifically when he winds up.

Section 71(b) of the Race Relations Act 1976 says that local authorities have a duty to promote equality of opportunity and good relations between persons of different racial groups. If local authorities with large black and ethnic minority communities are forced to buy from South Africa, good relations between people from those minority groups and the white community will be strained because people from those minority communities will rightly say that the Government are not taking on board their position or considerations in this important matter.

The Bill and this clause, dealing with equal opportunities, local labour and the non-rights of women, are very dangerous. I urge the House to vote for our amendment, which seeks to maintain a reasonable relationship between local authorities and central Government.

Miss Emma Nicholson (Torridge and Devon, West)

I welcome this excellent new clause, but has the Minister considered the effect on companies' employment policies of local authorities asking questions about race but not about disabled people? It is a section of the community that is cruelly disadvantaged and needs help in seeking the employment to which it is entitled and can so effectively carry out.

This new clause, in seeking to ask local authorities, with contract compliance in mind, to ask about the Disabled Persons (Employment) Act 1944, does not change any legislation, but gives proper recognition to the admittedly weak legal onus on companies to honour employment laws affecting disabled people. It is not too much to ask.

I appreciate that the laws covering disabled people—those covering equality for women also — are weaker with regard to contract compliance than the race relations legislation. I believe most strongly, as do all Conservative Members, in as free a market as is compatible with fair treatment for all. Careful employment opportunities offered to the disabled enhance, not reduce, profitability.

My own experience in computers — the sunrise industry, the industry of the future — shows that employing the disabled in this key sector—Britain leads in many parts of the computer industry worldwide —helps profitability and companies immensely. I suggest that acceptance of a modest amendment would not damage the growing profitability of our society under this Government, but would underwrite the Conservative party's commitment to tolerance and fairness.

Mr. Simon Hughes

I hope that the Government Front Bench listened to the point made quietly and reasonably by the hon. Member for Torridge and Devon, West (Miss Nicholson). There is a fundamental inconsistency between proposing the new clause to give effect to the Race Relations Act 1976 and to ensure that within the context of racial equality there is a degree of contract compliance and not accepting it in other ways. It has been accepted in the United States—the best model—that in relation to correcting disadvantages to the black and ethnic communities the contract compliance tradition—now 40 years old—has been most advantageous. However, it is applied across the board in areas of disability and women's employment.

The new clause moved by the Secretary of State, honouring an undertaking given in Committee, is welcome. I and my colleagues will support the new clauses and amendments tabled by the Labour party and oppose the new clause tabled by the hon. Member for Wolverhampton, South-West (Mr. Budgen) and his colleagues. I can deal easily with the rather disingenuous speech made by the hon. Member for Wolverhampton, South-West about, as he called it, this little bit of nonsense. He ignores the fact that in the country where there has been a tradition of working through legislative intervention in the public and private sectors to correct disadvantage—the United States—it has been accepted as appropriate not only by politicians on both sides of the political divide in America — it has been accepted by eight consecutive Presidents—but by the vast majority of employers, unions and public bodies as being a series of employment initiatives which have clearly been of great benefit to substantial numbers of people.

Mr. Marlow

Before the hon. Gentleman elevates contract compliance and the benefits of it in the United States into the realms of mythology, would he care to take account of the fact that in the United States forces—a country that has contract compliance—there is a mass of racial problems? However, in the British forces, where we do not have contract compliance to the same extent, there is not a problem.

Mr. Hughes

The hon. Gentleman is often deaf, but he seems to be blind as well. His point is invalid in general. The issue of how many problems we have of a racial nature in the forces has nothing to do with contract compliance because it does not apply there. However, the reality is that in Britain there have been recent examples of discrimination in the armed forces. I believe that it was the Prince of Wales who pointed out that we do not have any black guardsmen. It is clear that in the armed forces, and the police to a lesser extent—[Interruption.] If the hon. Member for Northampton, North (Mr. Marlow) would listen to the argument, we might have a better debate rather than if he continues to speak when an answer is being given. The hon. Gentleman will be able to make his speech, as he knows, in a moment. There has been a growing feeling among the black and ethnic minority communities in this country that to get into the armed forces and do well in them, particularly the more elite sections, is extremely difficult.

We are talking in this context about general employment. The hon. Member for Northampton, North will know that perfectly neutral non-political bodies in Britain have confirmed the success of a policy tried and tested in the United States. It is now backed by civil rights legislation dating back 10, 20 or 30 years, and it has been accepted by impartial experts in this country. The best example of acceptance—it was cited in Committee—is the Institute of Personnel Management. The institute wrote to hon. Members making it clear that it is vital that we continue with contract compliance. The paradox of the Government's position is that they have accepted that point. The hon. Member for Copeland (Dr. Cunningham) made the very good point, which was made in Committee, that the Government see the logic of the argument for contract compliance. I did not hear the hon. Member for Copeland quote the two specific sentences that are the best evidence of the Government's view. In September 1986, the Government made the case for contract compliance in a consultative paper on equality of opportunity in Northern Ireland. The report, endorsed by the Prime Minister as well as by the Secretary of State, said: equality of opportunity in employment means more than simply avoiding discrimination. An active commitment to sound personnel policies is required rather than the passive compliance with anti-discrimination legislation. 8.45 pm

It is right for Opposition Members to be suspicious of the Secretary of State and some of his colleagues because of their traditional view on subjects such as this.

However, we have to act to answer the second point made by the hon. Member for Wolverhampton, South-West, because we are talking about work that is done on behalf of the community. The work is tendered out, but it is done through the agency of government. It may be local government but it is government all the same. The Government have a duty to all the people. They have a duty, particularly at local level, to respect, advantage and assist all the communities in an area, whether it be disabled people, women or ethnic minorities. They have even more responsibility in areas with a large ethnic community. There is a strong argument that if the policies are not pursued in areas with large ethnic minority communities, it positively contributes to bad race relations and bad community relations. The economic well-being, and even the commercial well-being, to use the Government's criterion—they say we must not have non-commercial considerations—is disadvantaged. For example, if in the area around the Elephant and Castle in my constituency youngsters who are Bangladeshi by background do not have the opportunity of employment in south London, the economic well-being of south London will be disadvantaged because fewer of the local, trained young work force will be employed. They may go somewhere else but that will not help south London. In Birmingham and other cities with large ethnic communities the same will apply. The commercial considerations are just as important as the social and other considerations.

The Government have accepted contract compliance in the context of the Race Relations Act and in the context of Northern Ireland. In time I believe that they will have to accept it across the board in relation to disabled people and women. The sooner they do so with good grace, the better.

Although all inquiries that I have made on the subject have been treated courteously and properly, I believe that we in the House are not a good example. We do not employ as many disabled people or members of ethnic communities as we should. When I asked whether it was possible for us to employ a blind woman who had applied to me for a job here, I was told that it was unlikely that she could be employed. I give that simply as an example. We ought to look at our own practices. I hope that the result of this debate will be to ensure that the authorities in the House, which are self-regulating—we are those authorities — do not seek from others what we are unwilling to apply to ourselves.

We had a long debate in Committee, which has been referred to already, about the principles of European law. The Government are extremely reticent in arguing the case for local labour, which is the context in which European law becomes relevant. If they wanted to argue that case, they could do so, probably to good advantage. The Government have not shown us their advice. They may say that there is nothing unusual about that—which is true —but they have received advice from the Association of London Authorities and had counsel's opinion. Page 434 of "Erskine May" states: The opinions of the law officers of the Crown"— this would apply to opinions by counsel— being confidential, are not usually laid before Parliament or cited in debate, and their production has frequently been refused; but if a Minister deems it expedient that such opinions should be made known for the information of the House, he is entitled to cite them". I ask the Secretary of State specifically to cite what advice makes it contrary to European law that we have local labour clauses in the legislation.

Mr. Ridley

Has the hon. Gentleman received a letter which w as sent to him by my hon. and learned Friend the Minister for Local Government? The hon. Gentleman is talking as though he has not.

Mr. Hughes

I have received the letter — it was generalised—and I understand the points. I have it here. The Minister for Local Government knows the issue very well. If the Government think that they are right, why do they not do as they are entitled and seek a declaratory judgment from the European Court? If the Government think that we are right, why do they not do the same? They cannot lose. They could include in the Bill a new clause saying, "Nothing in the Bill shall be in breach of European law." The Government need not do that, because they cannot legislate in breach of European law anyway. It is ludicrous to put in the Bill a measure that says we cannnot have local labour clauses because it is in breach of European law. If it is in breach, the Government cannot have such measures. The issue could be tested. We should not have this pussyfooting.

Page 2 of the letter of 10 December to the hon. Member for Copeland about the discussion in Brussels states: There seemed a possibility that the Community as a whole might accept a scheme enabling suppliers in disadvantaged areas to obtain at least some part of the contract but it remains to be seen what the Commission will propose and how it will bear on works contracts. Instead of the Government just accepting that something might happen, why do they not argue the case? In July this year, on Second Reading, the Secretary of State said that he would like to be able to have local labour clauses. If he would like them, let us see a bit of effort to get them implemented. Let us not have half-cocked advice persuading the right hon. Gentleman that it is not worth the candle. Let us not suddenly realise that the policy for the inner cities will be averted at the first whiff of potential bureaucratic opposition. It is not a great commitment to the inner cities from the Secretary of State if the remote possibility that we cannot have local labour clauses is enough to deter him and his colleagues. If the Government are committed to the inner cities, let them test that commitment—if necessary, before the courts.

The sad truth is that this part of the Bill reveals two central Government attitudes. First, they do not respect the autonomy of local government. They wish their morality, their commercial standards, to be those of everyone else. Secondly, they wish to prevent others, who have been democratically elected, from being able to make moral decisions or decisions that are accepted in progressive societies as necessary to ensure basic equality, not to produce inequality.

We still have an extremely unequivocal society. Some people have a particular disadvantage. Some groups find life especially difficult. In the cities we are creating, as "Weekend World" put it yesterday, an increasingly large under class. The Government are meant to be committed to the inner cities. They cannot pretend that they are committed if, when the opportunity comes to do something about it, they go in the other direction.

The Secretary of State has made one small, faltering step in the right direction with the new clause. The Government will not do right by this country and by the disabled, ethnic minorities, women, and all of us, unless they embrace contract compliance wholeheartedly. I hope that the Government resoundingly reject the new clause of the hon. Member for Wolverhampton, South-West, with its gross overtones and undertones of racism and little Englander mentality. I hope that the Government wholeheartedly embrace, sooner rather than later, the amendments proposed by the Opposition and by the hon. Member for Torridge and Devon, West, because they make it clear that we have a duty to all our citizens to ensure that they have equal opportunities in work, employment and prosperity.

Mr. Tim Boswell (Daventry)

I support the general principle and thrust of what I understand the Government are doing in this part of the Bill, which is broadly to separate the two issues of commerce and politics and, where that is impossible, to regulate them. But I should appreciate some clarification from the Treasury Front Bench on some matters, especially since we are considering a Government new clause.

What is the evolution of the Government's thinking on section 71 of the Race Relations Act 1976? It is familiar to those who have been in the House longer than me that, however good the parliamentary draftsmen or their instructors, from time to time sections are overlooked when Bills are formulated. I understand that, if that had happened in this legislation, section 71, with its duty to avoid discrimination and to promote good race relations, would have continued untroubled and would have been in force. The Government do not seek to restrict any of those statutory responsibilities in this legislation.

But the Government took it on themselves in their original proposals to propose that the anti-discrimination part of the section should be enacted with certain restrictions. This would imply that the draftsmen had taken note of the section. If they had taken note of the first part of the section, why — this point arouses some suspicions among some of my hon. Friends—did they not take note of the second? As I understand it, they want it to go forward in a regulated form in the new clause.

I am concerned about the details as set out in subsection (5) and should like some comment on them. The new clause has not been considered in Committee—I did not have the benefit and privilege of serving on the Standing Committee — and there are certain points of doubt. First, we do not have the questions yet; we have not seen them. They are to go out to consultation with a large number of people. When they come back, will they be reported to the House in draft to provide us with the opportunity to comment on them before they are finalised?

Secondly, there is, in any case, a reference to the Secretary of State specifying a series of questions. I am not clear from the Bill whether he lays one egg, as it were, and that is the end of the matter or whether, in the light of experience, he or his successors—who may be of widely different political philosophies—may wish to amend or rescind the questions. Perhaps they can only add to them. Having set out in this direction, it is most important that we do not impose a set of onerous questions on private sector business men. Having decided what the questions are, it is most important that they be secure. There is always the danger that they will be torn up and changed in accordance with the whim of the moment.

I note that the Secretary of State has taken an order-making power in clause 19. There is no equivalent proposal under debate tonight; he could not take such powers in this case. That power would have been an appropriate vehicle for the questions that he wishes to specify. If I may dare to presume to say so, that would also have been a more normal parliamentary procedure.

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My third point goes somewhat wider than my first or second, relating to the efficacy and enforceability of the questions when they are in place. I say with respect to Opposition Members that race relations are highly sensitive. When one asks, "What are your non-working days in the week?", one is led into the question whether Jewish or Muslim employment is involved. Simple and apparently innocent questions can be construed in different ways.

Conservative Members worry that, even if the questions are specified in simple terms by the Secretary of State, they may be abused and perverted by certain local authorities — I hope that none will do this — to a completely different purpose. As I understand it, under clause 19 all that a local authority has to do is to give a chit to unsuccessful business men to say, "Sorry, chum, this is why we turned you down," and that appears to be the end of the matter. I should like some comments on that.

To those of my hon. Friends who were hoping for a little support for new clause 9, let me say that the debate has been valuable. I do not share Opposition Members' perception of my hon. Friends. However, I shall not be supporting them. I take a fairly relaxed view of declaratory legislation such as section 71 of the Race Relations Act. That section should be promoting among local authorities the decency that we as citizens — and some of us as employers — apply to our own labour practices and personal lives. I do not want that section to be rescinded completely, which would be the effect of the new clause. It might have been different had my hon. Friends decided to table a new clause disapplying the Race Relations Act to these clauses of the Local Government Bill. They chose not to do that and I shall not follow them into the Lobby.

Having said that, it is right that I should voice my concern and ask the Government to answer my questions and ensure that the way in which they have restricted the application of section 71 of the Race Relations Act and imposed questions on local authorities works in a way that will not lead to abuse or to the negative race relations that such practices have often led to in the past.

Mrs. Maria Fyfe (Glasgow, Maryhill)

The country should note the fact that, although the Bill is already extremely objectionable in many respects, it does not go far enough for some Conservative Members. The hon. Member for Wolverhampton, South-West (Mr. Budgen) most clearly expressed that dissatisfaction and his proposal is so Right-wing that most people in Britain would find it completely abhorrent. Any comment made in my area about Glasgow district council or Strathclyde regional council and their efforts to improve the lot of ethnic minorities is likely to be a criticism that they are not doing enough; they are not criticised for going too far.

It is interesting that, when the hon. Member for Torridge and Devon, West (Miss Nicholson) was attempting to appeal to the Government's better nature on disabled people, she felt that she had to appeal to their pockets by pointing to the enhanced profitability arising from the employment of disabled people. What a comment it is on the Government's attitude that they could not take such action out of kindness or humanity.

I move quickly to sex discrimination, which has not had much of an airing yet. Earlier in the debate, my hon. Friend the Member for Copeland (Dr. Cunningham) referred to the Equal Opportunities Commission's comments on the Bill and the fact that it would like the Sex Discrimination Act to come into line with a section of the Race Relations Act. The Minister has still not replied on the action that he intends to take on the Equal Opportunities Commission's representations. As my hon. Friend pointed out, we are still waiting for an answer. The Minister shows no signs of replying now, but perhaps he will later on.

In Committee, the hon. Member for Harrow, West (Mr. Hughes) said that he would like contract compliance throughout industry. Hon. Members may recall his making that comment. He said that he felt that it was right to object to it in local government, because local government was taking on itself powers that it did not rightfully have. Unlike most of his hon. Friends, the hon. Gentleman suggested that he would like to see contract compliance in industry. I asked whether he intended to present a Bill to that effect, because I would gladly support it. That was four weeks ago, but I still live in hope.

The possibility of the Government doing anything about equal rights for women cannot be taken seriously in view of their record. Since 1979, they have done nothing to advance women's rights—and have, indeed, retarded them in many serious respects. They have abolished maternity grants and have made the conditions for maternity leave harsher. They have attacked the wages councils, which protected low-paid women. Part-time women workers still have worse pay and conditions than full-time workers.

The chair of the Equal Opportunities Commission—Lady Platt, who is a Conservative—has said: It would be an extremely worrying development if the Bill were to go ahead, given the very serious problem of discrimination against women that still needs to be tackled". Even the Government's own supporters are complaining, but the Government pay no attention whatever. The EOC, as an agent of the Government, has encouraged local authorities to develop equal opportunities policies and has successfully advised local authorities for several years, but the Government seem to dismiss the EOC's objections to the Bill out of hand.

Some Conservative Members seem puzzled about why local authorities should need to take these matters on board. I will give the House some figures. In general, women earn only 74 per cent. of male earnings, despite the Sex Discrimination Act and the Equal Pay Act, which were supposed to ensure equal treatment. For manual work, the figure is 71 per cent. and for non-manual work 62 per cent. Sadly, the position is even worse in Scotland. In 1986, female average weekly earnings in Scotland were 64 per cent. of male average earnings. That represents a very small increase since 1976, the year after the Act was passed. Moreover, 32—7 per cent. of Scottish women's average gross weekly earnings are less than £100, whereas for men the figure is 6—7 per cent. More than 12 per cent. of working women in Scotland gross under £75 per week, so the situation is well documented—women are paid far less than men.

It is common knowledge that men predominate in the higher paid and more highly skilled jobs. The most obvious example is the House of Commons, where only 41 out of 650 Members —just over 6 per cent. of the total —are women.

Far from recognising the importance of advancing women to positions of higher pay and greater authority, the Government are doing their best to reverse the efforts of those who are trying to deal with the problem. I am not surprised at the Government's complacency. It suits them very well that women are not competing successfully with men. There is clear evidence that women predominate in jobs with lower pay and lower status, particularly cleaning jobs, shop work and assembly and machinist work. They are even excluded from manual clerk jobs and they are rare indeed in the higher reaches of management, whether in industry and commerce or on the Conservative Benches. As for the Prime Minister, she has not done much for the advancement of women.

The discrimination that was attacked in the Sex Discrimination Act still continues, but the Government do not wish to enforce that Act vigorously. For example, application forms still contain questions about women's marital status, ages of dependants and child care arrangements. I wonder what male applicants would think if they were asked how many children they had and who would look after them — questions which some people still regard as acceptable for women candidates. At company interviews people are still asked questions of that sort and the Government have done nothing about that.

As my hon. Friend the Member for Copeland said, the Government have accepted the logic of contract compliance in Northern Ireland over the matter of religious discrimination. I asked the Secretary of State why the Government accepted it in Northern Ireland and not in mainland Britain. He answered that there were "significant differences" between this country and there. It seems that women will have to riot in the streets in order to get the equality that we seek.

All along we have seen incredible bossiness and authoritarianism from the Government. They have been trying to tell local authorities how to conduct their affairs and seem totally unconcerned about the fact that local authorities are elected by the local electorate on the basis of what the electorate wants. If the electorate does not like the local authority's policies on ethnic minorities, disabled people or women, it can exercise its vote to say so. I am pleased to come from an area where there are no Tory Members of Parliament and where only five out of 66 district councils are Tory-controlled. The views that the Tories express are certainly not popular in some parts of the country. Indeed, their views are neither understood nor known throughout the country—especially by the 52 per cent. of the population who are women.

Mr. Marlow

I am sure that the hon. Member for Tottenham (Mr. Grant) has heard the expression about the pot calling the kettle black. May I through you put it to him, Mr. Speaker, that if he continues to accuse everybody who disagrees with his views of being racist, people will start to look upon him as being a black racist?

I have seen my right hon. Friend the Secretary of State for the Environment embarrassed before. I have seen all my right hon. Friends embarrassed before — there is nothing particularly special about that — but my right hon. Friend has been embarrassed before because he had a hard time in debate. When he had a hard time in debate he actually believed in what he was putting forward. Today my right hon. Friend is not only having a hard time in debate, but it is very hard to believe that he believes in the measures that he is putting before the House. I am fully committed to my right hon. Friend's intentions; there is no problem on that score at all. He will have heard from the Opposition Front Bench that what he has been putting to the House this evening is Socialist policy, and he has also had the blessing of the Liberal party. No wonder he is embarrassed.

The Bill when it first started was three paces forward and one pace backwards. The new clause that we are debating makes it three paces forward and two paces backwards. Obviously, this is a contentious issue. It is on a Monday. Nobody really arrives until Monday afternoon and nobody knows what the business is until Monday afternoon. It started at 7 o'clock in the evening when the press had disappeared, so we debate what we want here and the wider world will have no knowledge of what we are doing. As my right hon. Friend knows, the vast majority of Members of his own party disapprove of what he is doing and are all elsewhere instead of being here for the debate.

The history of immigration and race relations in this country has been democratically deeply disturbing. I make no comment on the immigrant community as a whole which is as industrious or as idle, as virtuous or as evil, as decent or as indecent as the population at large—there is no difference whatever. The country never willed large-scale immigration. It always opposed large-scale immigration and Governments have always been unwilling and powerless to staunch the flow. It has always been too little and too late. As with immigration policy so with policy on race relations.

The absurd, unloved Race Relations Act 1976, the nonsense that was referred to by my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen), was introduced, put upon this country, by a Labour Government. I am proud to say that the Conservative party abstained and my right hon. Friend to his lasting credit, until this evening, actually voted against the measure. If it did not exist, I asked my right hon. Friend whether he would introduce it. Should it exist? If we were right to oppose it then, surely we are right today to increase its influence over the original Bill. Alack and alas, our heroic Government have been got at by the moral blackmail of the race relations industry, through its absurd and life-supporting myth that those who dare to oppose its own institutional vested interests are racists. When anybody says anything sensible on this subject, he is accused of being racist. I am sorry that it has had its impact on my right hon. Friend. I know that he is a brave man.

9.15 pm

I imagine that we are all in favour of social harmony. We are all in favour of good race relations. Why does the giggling, cackling crowd on the Benches opposite find it impossible to recognise that there are many means of approaching the same end? Perhaps there is an alternative that would be far more effective than the muddled theories currently being applied. My right hon. Friend is an imaginative man. I wish that he would use his imagination and, with one leap, break free from the mental dictatorship of this self-regarding and damaging lobby. He would get immense support in the country, on earth and probably in Heaven too.

The Government's intention in introducing this Bill was to prevent corporatist, mischievous local authorities from abusing their position by introducing political constraints into what should be purely value-for-money contracts. I believe that the Government share my view that local authorities are there to decide democratically the level of services to be provided, how the money will be raised to pay for those services and how to regulate the provision of those services. Local government has no role in bringing about a new political millennium. If that is to be decided, it is to be decided here, at the national level. The intention of the Bill was consistent with that principle, albeit with a small concession.

Then there were those who were waiting in the wings to pounce on my right hon. Friend. It was not good enough. There were squeals of outrage. Grubby hands have since been grappling with the entrails of Government to bring about changes in the Bill. Once again, I am afraid that the foul deed has been done and that the lobby has overruled democracy. The vested interests have decided and Parliament has been brought into the debate at far too late a stage to influence it. The Government have been rolled over.

My hon. Friend the Member for Harrow, West (Mr. Hughes) was telling us about the Commission for Racial Equality. I do not share his view. The commission is very germane to this debate as it is the progenitor of the new clause which my right hon. Friend has put before the House. It is an aggressive, assertive conglomeration of lobbies which suit the purpose of selected minorities within selective minorities. By being antipathetic to the majority of the population, it harms race relations rather than heals. Five eighths of the staff are coloured. In all probability, a large proportion of that staff are political activists, unrepresentative of the communities from which they purport to come. One wonders to what extent the credibility of some of the people who work in the race relations industry is dependent on the growth of racial harassment, rather than on racial harmony. Their attitude is deeply patronising and insulting to ethnic minorities and provocative to the majority.

If you are looking for evidence, Mr. Speaker, I have here the annual report of the Commission for Racial Equality. It spends at least £10 million a year. How does it spend it? It spends £29,000, for example, on something called Black Rights UK. There would be a problem if there were an organisation called White Rights UK that was funded by Government. It spends £32,000 on a federation of black housing organisations. I suppose apartheid is wrong unless it is practised by blacks. It spends £8,000 a year on something called an anti-racism worker, who works for Third World First. Is that how we should spend public money? It spends £26,000 a year on the West Indian standing conference. If there is, and should be, a West Indian standing conference, would it not be more dignified and more effective if it raised the money on its own? Is that how public money should be spent? How many broken babies could our hospitals operate on for £10 million? That sort of attitude encourages the supplicate and mendicant postures from self-styled leaders of ethnic minorities, some of whom are on the Opposition Benches.

I ask my right hon. Friend whether it is right that a Conservative Government should share that patronising and damaging approach. Sadly, pressures have been applied to see that, at this stage, they do. The Government have yielded and have brought forward a new clause about which, in his embarrassment, my right hon. Friend did not tell the House a great deal. I shall point to a few facts within it. New clause 5 states: Except to the extent permitted by subsection (2) below, section 71 of the Race Relations Act 1976 … shall not require or authorise a local authority to exercise any function … by reference to a non-commercial matter. We now come on to exceptions. With the exceptions, the authorities are able to ask approved questions seeking information or undertakings relating to work force matters and consider the responses to them. They will be able to ask companies about what is happening to the labour force and they will be able to consider them when they have got the reply back from the company. Clause 5(2)(b) states: including in a draft contract or draft tender for a contract terms or provisions relating to workforce matters and considering the responses to them". So they will be able to tell companies how to organise and manage their own work forces. All this, you will be pleased to hear, Mr. Speaker, has to be put down in writing. If authorities do not like what they get from applicant companies — the companies that want to contract with them — they will be able to write for supporting evidence. How many letters will go backwards and forwards? How long will it take a local authority to answer a letter? What questions will it ask? What will it do with the information that it gets in the answers? If it does not like the answers, what will it be able to do? What recourse will industrialists—the commercial companies — have in a court of law against arbitrary exclusion after the exchange of letters?

Of course, there is one other important point, and that is that, for the purpose of this section, the questions will be set out by my right hon. Friend the Secretary of State. The Secretary of State has kindly told the House that, before he puts his questions forward, he will have discussions with the Commission for Racial Equality and local authorities. How aware is the House that, in September of this year, the Commission for Racial Equality introduced a code of practice — principles of practice—for contract compliance? When my right hon. Friend goes along to speak to the Commission for Racial Equality, this is what the Commission for Racial Equality will show my right hon. Friend. What is he going to do with it? He has taken orders from the Commission for Racial Equality with regard to bringing the new clause forward. Is he going to take orders or will he be disagreeable when he sees the contract of compliance code of practice?

While we pay court to the Commission for Racial Equality, the likelihood is that the Government will feel morally bound to accept, at least in part, what the Commission for Racial Equality requires them to do. What will the Commission for Racial Equality require the Government to do? Among the general principles that have been enumerated by the Commission for Racial Equality, one of them—this is referring to the letter that comes back from the contractor—states: Where such information in the opinion of the purchaser"— that is, the local authority— shows an absence of reasonably necessary steps to eliminate unlawful racial discrimination and to provide equal employment opportunities, the contractor or potential contractor should be informed and given an opportunity to make whatever changes are agreed to be appropriate within a specified reasonable period of time. What if the contractors do not respond in the way in which the local authorities want? If we look at the local authorities that are commanded by the Labour party —Camden, Bermondsey, Liverpool and the rabble in the country outside — what will they do with that information? It will be manna from heaven for them. It is a messy and provocative business. It will be a paradise for the barrack-room lawyer, the mischief-maker, the prevaricator and the litigant. The Government intend to prevent discrimination — there is no argument among Conservative Members about that. If, however, the Government believe that the best way of dealing with discrimination is by legislation, there may be some argument on the Government side of the House.

However, section 4 of the Race Relations Act 1976 says: 4. — (1) It is unlawful for a person, in relation to employment by him at an establishment in Great Britain, to discriminate against another—

1. (a) in the arrangements he makes for the purpose of determining who should be offered that employment; or
2. (b) in the terms on which he offers him that employment; or
3. (c) by refusing or deliberately omitting to offer him that employment.

(2) It is unlawful for a person, in the case of a person employed by him at an establishment in Great Britain, to discriminate against that employee—

1. (a) in the terms of employment which he affords him; or
2. (b) in the way he affords him access to opportunities for promotion, transfer or training, or to any other benefits, facilities or services, or by refusing or deliberately omitting to afford him access to them; or
3. (c) by dismissing him, or subjecting him to any other detriment."

It is all there. That is law for contract compliance. That is what will ensure that there is no racial discrimination in employment. There is no need for local government to be breathing and heaving over independent commercial companies looking into their employment situation to see how they run their systems. The law is there. We do not need sneaks and narks from Left-wing Labour party local government districts and counties rubbing their noses against private employers who are trying to do decent work and have better things to do than to have people snooping over their shoulders all the time. Why are we opening this Pandora's Box when the Minister has said that: Local authorities should not be in the business of setting themselves up as extra-statutory enforcement agencies on matters that are already the subject of existing statute and which already have where appropriate, their own enforcement processes."? He said later on 17 November, However, we aim to prevent authorities from asking endless questions and from seeking the most detailed information about the extent to which contractors obey the law." —[Official Report, Standing Committee A, 17 November 1987; c. 793–4.] New clause 5 was put before the House to do just that. I believe what my hon. and learned Friend the Minister of State said on 17 November, and I am sure that he will be consistent. I am sure that my hon. Friend will have seen the amendment tabled by my hon. Friend. Bearing that in mind, I beseech my hon. Friend, if he wants to go the way he said on 17 November, to join me and my hon. Friends in the Lobby later this evening.

Mr. Andrew Welsh (Angus, East)

While listening to the hon. Member for Northampton, North (Mr. Marlow), I certainly sorrow for England in disbelief that such a speech could be made in the House. Such prejudice is best returned whence it comes and the lid firmly slammed shut on it. I am glad that the Minister is on the Front Bench and not his hon. Friend the Member for Northampton, North.

New clause 5 is welcome. It is an admission that the Government have made a mistake in drafting their legislation too tightly. By opening the gate just a little in regard to local authorities positively promoting social goals such as better racial harmony and equality of opportunity among all sections of the community and by allowing local authorities to exert influence in positively promoting good industrial practices and industrial relations, the Government have moved towards understanding the debt we all owe to local authorities throughout the country for promoting those desirable goals for many years. Local authorities — which are usually attacked by the Government — have a good record of promoting policies and practices that benefit society in general. I have seen this in practice in Scotland. New clause 5 shows that the Government are beginning to recognise that fact slightly. It is also a tacit recognition that the Bill goes too far in giving the Government control over democratically elected local authorities.

Contract compliance is a necessary and desirable local safeguard. Why should councillors not set conditions under which legally made contracts should work? They pay money on behalf of local people and they must retain the right to state the terms on which contracts are made. Local authorities should have such freedom of action. If local people do not like what councils do, the matter should not be left to the central Government. Rather, local electors should decide whether they like how their councillors have behaved and vote accordingly. The Government are inflicting their prejudices on local government.

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New clause 5 addresses an English problem. It has little to do with Scotland. It seems that, time and again, English local government sins — if that is what they be — are being visited on Scottish local authorities in the Government's desire to curb what they regard as excess. Scotland should not be tagged on to what is basically an English Bill. The more I study the Bill, the more I am confirmed in my belief that it is nonsense for Scotland. It bears no relation to the workings of Scottish local government and Scottish geography or demography. The Bill is irrelevant to my country.

The Government expect certain standards of conduct from local authorities. Why should local authorities be unable to expect certain standards of conduct from those whom they employ to carry out contracts? —[Interruption.]

Mr. Speaker

Order. I ask both sides of the House to listen rather than conduct private conversations.

Mr. Welsh

He who employs the piper is not being allowed to call the tune. The Government have recognised that in new clause 5.

Will the Minister draw in local authority-produced questions, or does he have it in mind to produce standard questions for distribution to local authorities? Do the Government have any questions in mind now? Do any questionnaires or forms exist and, if so, when will local authorities see them? What time scale does the Minister have in mind to introduce the standard questions? It would be useful if local authorities knew what will hit them.

What consultations will take place with local authorities and the Convention of Scottish Local Authorities when and if the questions are drawn up? The problem with new clause 5(5) is that it does not go far enough to relieve the Government's stranglehold over local authority decision-making. It restores strict Government control and almost wipes out what is conceded in subsections (1) and (2). Local authorities have a right to express their views and to insist on higher standards of conduct among contractors. New clause 5 recognises that, but immediately imposes another straitjacket. The Government have admitted their mistake but have done little to correct it.

Mr. Geoffrey Dickens (Littleborough and Saddleworth)

It is probably common knowledge that I was the first Conservative candidate for 100 years to be elected to represent Huddersfield, West. I now represent another constituency. When I was campaigning in Huddersfield it became clear to me—it seemed that this had not been apparent in the past, which is probably why the Tories had not won elections in Huddersfield, West — that I had to deliver the coloured vote to the Conservative party. That vote amounted to 12 per cent. of the local population. I did not get the coloured vote by pandering to the coloureds—[Interruption.] I went to the Sikh temples and I went—[Interruption.]

Mr. Speaker

Order. Every hon. Member must frame his own speech, and we all use different terms. Perhaps the hon. Member for Littleborough and Saddleworth (Mr. Dickens) will take care.

Mr. Dickens

Thank you, Mr. Speaker.

I was saying, before I was interrupted, that I went to Sikh temples, mosques and Caribbean groups. I visited them all. I said to them all—Opposition Members might be astounded to hear this—"Many of you, and certainly many of your parents, would not be here if it had been left to me." As a result, they trusted me. They knew that I was truthful. Opposition Members cannot take this —[Interruption.]

Mr. Speaker

Order. We often hear things said in the Chamber with which we do not agree.

Mr. Dickens

Thank you, Mr. Speaker.

It is silly to pander to minority groups. Indeed, to do so makes relationships worse. There was a case, for example, of a fat girl who was refused employment by a bank. That was held to be discrimination. That approach would be of trouble to me, of course. Whenever a minority group is pandered to, relationships will be inflamed.

I have not yet decided which way to vote on the new clause. I want to hear the reply of my right hon. Friend the Secretary of State. If local government employs contractors with ratepayers' and taxpayers' money, I want them to be employed because they will do a good job at a competitive price. I do not want a contractor to be selected because he employs a number of people from certain groups. The only criterion is whether a worker is up to the job.

The hon. Member for Hackney, North and Stoke Newington (Ms. Abbott) talks a great deal about the role of women. The Conservative party produced the first woman Prime Minister in Britain's history, so why should we be lectured by Opposition Members about putting ladies first? The Conservative party has put women first and foremost.

I shall listen intently to the reply of my right hon. Friend. If he can give an assurance that the selection of contractors will be sensible and fair and not based on criteria that have been adopted by the Kremlin republic of Sheffield and elsewhere, I shall be content.

Mr. Peter L. Pike (Burnley)

I do not intend to take up the remarks of the hon. Member for Littleborough and Saddleworth (Mr. Dickens). I shall refer, however, to the speeches of the hon. Members for Northampton, North (Mr. Marlow) and for Wolverhampton, South-West (Mr. Budgen), which highlighted the extreme Right-wing position of many within the Conservative party. Whatever criticism we may make of the Government, I believe that even they are embarrassed and ashamed by some of the comments that were made by those two hon. Members.

The hon. Member for Northampton, North said that he hoped to have the opportunity to vote for new clause 9, in his name and the names of some of his hon. Friends. I hope that they will not be able to do that because, as Madam Deputy Speaker indicated at the beginning of the debate, that will not be possible if new clause 6 is carried. Should new clause 6 fall, I should like to see how many Conservative Members are prepared to go through the Lobby in support of the appalling new clause 9.

My hon. Friend the Member for Tottenham (Mr. Grant) felt that he could not welcome Government new clause 5. I disagree. Having been in the House for four or five years, 1 recognise that to get any concession from the Government is rare. Therefore, the fact that they are prepared to make some amendment to the Bill in response to the debate in Committee is at least welcome. I welcome that small step in the right direction, but obviously we wish to go further.

If I do not speak on racial equality, the need for women's equality or the position of the disabled —matters that have been referred to in the debate—it does not mean that I think they are not important. They are extremely important, but I want to deal briefly with one or two other points.

The first part of new clause 6 refers to the terms and conditions of employment offered by contractors to their workers, and it goes on to the training of the work force. Training is important. When a local authority is putting out contracts to the private sector as a result of this legislation it should be able to ensure that adequate training is provided. If in 1987 we make legislation which allows workers to be offered worse conditions, worse pay, worse holiday pay and worse sick pay, we are moving in the wrong direction. We need the provisions in new clause 6.

In replying to a debate in Committee, the Minister of State indicated that it would be a restrictive practice for local authorities to pay double time to people to work on a Sunday. Anyone who works on a Sunday, or other unsocial hours, is entitled to additional pay. Because of the unemployment that the Government have created, it will he possible, as the Minister said in Committee, to get someone in the private sector who is desperate for work to do the work at a low rate of pay. People who have won contracts in places such as Merton and Wandsworth pay appalling low rates. The same applies to the Health Service. The Government have said that they want to ensure fair competition. We can do that only if the Bill ensures that employees in the private sector enjoy an overall employment package at least equal to that of employees within local government.

Some of my hon. Friends have already referred to the need to employ local labour in the most deprived sections of our cities and towns. Despite the Secretary of State's comments on this matter on Second Reading and on a number of other occasions, it is surprising that he has found it impossible to include something in the Bill to ensure that there is a safeguard so that we can at least give a fair opportunity to local people for work that is put out to tender. At the end of' the day, those people pay the rates and the bills. They should be able to tackle the problem of urban deprivation in some of our most difficult areas by providing for local employment opportunities.

There are many other important items within new clause 6, but I shall keep my remarks to the absolute minimum. I hope that Conservative Members will be prepared to recognise the wisdom of new clause 6. If not, I hope that they will accept the Government's new clause 5 and reject new clause 9.

9.45 pm

Mr. Allan Roberts (Bootle)

I urge the House to vote for new clause 6 and new clause 7 standing in my name and the names of my hon. Friends. Although new clause 5 takes a step forward, it does not go far enough. However, I reluctantly urge hon. Members to vote for Government new clause 5 if there is a Division.

New clause 5 was tabled by the Government on Report as a result of a commitment given in Committee by the Minister and the Secretary of State to ensure that the legislation does not contravene section 71 of the Race Relations Act 1976. We have heard major attacks on the Government's new clause 5. Indeed, we have heard attacks from Conservative Members on the Race Relations Act 1976. The hon. Member for Wolverhampton, South-West (Mr. Budgen) said that the Race Relations Act 1976 granted special rights to a minority. When asked what those special rights were, he said, the protection of the Race Relations Act. The hon. Gentleman was attacking the protection under law not to be discriminated against because of the colour of one's skin or one's racial or ethnic origin.

I am proud to state that the Labour party has a proud record on human rights in supporting successive Race Relations Acts. We were accused of having that record, and we plead guilty to that. We support the Government's intention to ensure that local authorities do not contravene section 71 of the Race Relations Act 1976, because we want to ensure that people are not discriminated against.

We are concerned to some extent about the details of new clause 5. We see no real reason why the Secretary of State should take all the powers under the clause, as he has under other clauses, especially without any reference back to Parliament. The Secretary of State is given the powers to prescribe the questions which a council may ask of its suppliers and the evidence which the council may consider when examining the answers that it receives if he so chooses by allowing only the wrong or irrelevant questions to be asked. We shall carefully watch the consultation process promised by the Secretary of State and see what arises to ensure that the intentions behind new clause 5 are not subverted as a result of how the Secretary of State uses his powers.

I also agree with the hon. Member for Northampton, North (Mr. Marlow). We do not see why all the contract compliance activity should be carried out in writing. What is wrong with telephone calls or meetings? What is wrong with a discussion? We believe that local government will be saddled with a lot of bureaucracy — the Minister flourished a large and weighty document from Sheffield and criticised its bureacuracy— by limiting the process to being conducted in writing, and local contractors will also suffer as a result of that bureacuracy.

It has been asked what right local authorities have to interfere in the internal running of companies. The question strikes at the key issue that we are debating. We are talking not merely about race discrimination, but about the whole issue of contract compliance arid tendering. It seems to be suggested that a local authority making certain specifications when letting a contract to a private company is somehow interfering with its internal running. What about the rights of the local authority? What about my rights as an individual citizen? I can determine what contractor, in what circumstances, comes to repair my house or to lay carpets. Local government should have that freedom as well.

If the outlawing of contract compliance is coupled with the competitive tendering clauses in the Bill, direct labour departments will be put at a disadvantage, and one private company will be at a disadvantage compared with another Let me give an example. If a direct labour department or a private company employs the right percentage of disabled workers, it will, to an extent, be at a disadvantage compared with a company that employs no disabled people and is not prepared to support those members of our community.

Mr. Dickens

rose—

Mr. Roberts

I shall not give way—certainly not to the hon. Member for Littleborough and Saddleworth (Mr. Dickens), who has only just come into the Chamber, and has said that he has not decided how to vote because he wants to listen to the debate.

Mrs. Kellett-Bowman

Will the hon. Gentleman kindly withdraw what he said about the disabled? Disabled people are just as good workers as anyone else. How dare he say that they will put their companies at a disadvantage?

Mr. Roberts

As a senior social worker and a principal officer in a social services department before I came to the House, I am well aware of the capacities of disabled people. I am also aware that certain people with certain disabilities are employed, because of their disabilities, on a different basis from the able-bodied. Many private companies will not employ such people, and those who do employ them should not be discriminated against. Neither should local authority direct labour departments.

The same applies to training. Training is very important to the future of British industry, and the future of our young people. Why should not a local authority be able to say, "If you do not employ a reasonable number of apprentices—if there are no training opportunities—we should prefer to employ the company that trains youngsters, and provides those opportunities"? Why should local government not have those rights, for the sake of our young people and for the sake of the future?

We have written a provision about countries of origin into new clause 7. Conservative Members say that their only interest is in whether the companies can do the job for the best possible price: it is purely a matter of money. My hon. Friends and I made it clear in Committee that we accept that, if local authorities, the Government or anyone else will not deal with companies that trade in South Africa, there is a price to be paid, and we are prepared to pay that price as a matter of principle. We are opposed to the apartheid regime, and we think that the taxpayers and the electors of local government should have the right to elect local authorities that are also opposed to it. If they do that, local authorities have the right to such contract compliance provisions.

Local government is not isolated or non-accountable; it is far more accountable than any of the local companies with whose internal workings Conservative Members claim we are trying to interfere. Local authorities should have the same rights as Conservative Members to specify what issues they consider important in terms of whom they employ to do work on their behalf and on behalf of their electors and ratepayers.

I do not believe that, every time a Conservative Member says something on immigration or race relations with which I disagree, he is necessarily racist. However, I should say to the hon. Member for Wolverhampton, South-West that those who claim that they are not racists but who are prepared to use racial prejudice and the fear of it in the community to get grubby, filthy votes are worse than any racists because they are also hypocritical. The speeches from and attitudes of some Conservative Members that we heard today were designed to get racist votes, even though they denied that they are racists. They played on prejudices, which is unworthy of any great political party and unworthy of the Conservative party, with its traditions, and I wish that the Cabinet and the Secretary of State would repudiate those remarks and clearly say that they oppose them.

I pay tribute to the hon. Member for Harrow, West (Mr. Hughes) whose speech was thoughtful, well measured and sensible. It was no surprise that he received barracking from Tory Back Benchers, which is not unusual when a Conservative Member makes a speech that is liberal and progressive and does not pander to prejudices. I congratulate the hon. Gentleman; he should stick to his guns.

Contract compliance is about local government democracy and the freedom of local government to determine its own affairs. It is about more than that—it is about good training for young people, the employment of disabled people and health and safety at work—but it is not about pandering to prejudice. It is about allowing local government to lay down criteria that will make Britain a juster, fairer and freer society. That is why we tabled new clause 6 and new clause 7 and why we shall prevent Tory Back Benchers, who are to the Right of even the Secretary of State for the Environment, from defeating new clause 5.

Mr. Ridley

We have had a wide-ranging debate on a rather narrow point, but I make no complaint about that. The debate has been wide and varied and has prompted some pretty strong stuff, although I am glad to say that there was minimal use of the word "racist". The most crucial and telling phrase came from my hon. Friend the Member for Northampton, North (Mr. Marlow), who talked about grubby hands grappling with the entrails of the Government. I would not say that the debate had gone as far as that, and my entrails are certainly feeling quite well, despite what we have heard this evening.

I should like to answer briefly the specific points that hon. Members have raised. I shall formulate four, five or six approved questions on race relations and put them out for consultation—including the Convention of Scottish Local Authorities if that is what the hon. Member for Angus, East (Mr. Welsh) wants—and anybody wishing to comment will be able to do so. They will be standard questions that cannot be varied, and the powers will be exercised, as the new clause says, in writing by me without an opportunity for the House to pray against them, but they will be placed in the Library.

In reply to my hon. Friend the Member for Daventry (Mr. Boswell), I should say that I do not believe that there can be an abuse of these questions. They will have to be standard questions, and a local authority can, on receipt of the answers, decide not to let the contract to the lowest tender. In that case, it will have to satisfy the auditor, and perhaps the wider electorate, that it had good reason for so doing.

Mrs. Kellett-Bowman

Can my right hon. Friend give the House any guidance as to how easy it would be for a Labour Secretary of State, should the Labour party ever get into power, to change the questions? How long would it take to change them?

Mr. Ridley

The Labour party could change a great deal. It would not stop at changing the nature of the questions. We cannot for ever insulate the great British public from the possibility of having a Labour Government. However, we have not done badly recently.

Mr. Marlow

When my right hon. Friend sets out his approved questions, will they be the last word, or will the Commission for Racial Equality or other organisations be able to take his questions to court and say that they conflict with the Race Relations Act 1976 and that he must bring forward some other questions?

It being Ten o'clock, the debate stood adjourned.