Commons Sitting of 22 July 1987

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

    HAMPSHIRE (LYNDHURST BYPASS) BILL [Lords] (By Order)
    Order for Second Reading read.
    To be read a Second time tomorrow.

Oral Answers to Questions
  SCOTLAND

    Health Care
    Mr. Michael J. Martinasked the Secretary of State for Scotland what steps he is taking to improve health care in Scotland.
    The Parliamentary Under-Secretary of State for Scotland (Mr. Michael Forsyth): There are more doctors and nurses than under any previous Government and more patients are being treated than at any time in the history of the National Health Service in Scotland. A massive capital programme is under way, with 48 major new hospital developments completed since 1979 and 34 more in the pipeline. The Government will continue to build on this record of success in Scotland.
    Mr. Martin: The Minister may know that prior to the election Lord Glenarthur wrote to me to say that the Stobhill maternity unit would be saved and that it was possible that Stobhill might be the site for the new Royal maternity unit. Given his new position, does the Minister consider that Stobhill would be an excellent place to have the Royal maternity unit?
    Mr. Forsyth: The future of the Stobhill hospital will depend on a general review of acute services that is being carried out by Glasgow. As the hon. Gentleman knows, a decision whether the maternity unit should close was deferred while a feasibility study and appraisal for the replacement of the Glasgow Royal maternity hospital was conducted. That is still going on. I have nothing to add to the previous commitments that have been given to the hon. Gentleman.
    Mr. Buchanan-Smith: Is my hon. Friend aware of the concern in Grampian and Aberdeen about the need for a new, modern cardiac surgery unit? Can he tell us what progress has been made in the review and when we can expect a decision?
    Mr. Forsyth: I am grateful to my right hon. Friend. I was made well aware of that when I visited Aberdeen the other day. As he knows, the Advisory Committee on
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    Specialist Services is looking at the matter and we expect to have a report shortly. At that point, it will be possible to take a view about Aberdeen.
    Mr. Malcolm Bruce: Is the Minister aware that in general terms in Grampian there is concern at the delay in implementing the SHARE formula and at the shortfall in facilities such as those mentioned by the right hon. Member for Kincardine and Deeside (Mr. Buchanan-Smith)? Is he further aware that we are disadvantaged by the fact that there is no such formula for ambulance services and that people in my constituency, in the community of Ellon, have no firm indication of when they will have an ambulance station, in spite of a commitment from the local chief ambulance officer that that will be provided? Will the Minister tell us when we will receive the resources?
    Mr. Forsyth: Aberdeen and Grampian have done extremely well under the SHARE formula. It is true that they have not reached parity, but the resources made available to the Grampian health board are substantially greater than they would have been without the SHARE formula. I should have thought that the hon. Gentleman would welcome that.
    Mr. Forth rose—[Interruption.]
    Mr. Speaker: Order. Scottish Members take part in English Question Times and English Members may take part in Scottish Question Times.
    Mr. Forth: Will my hon. Friend confirm that National Health Service expenditure per capita is higher in Scotland than in England? As the per capita consumption of alcohol, tobacco and confectionery is higher in Scotland, particularly in Strathclyde, than in England, may I ask what impact that has on the effectiveness of NHS services?
    Mr. Forsyth: I am grateful for my hon. Friend's question. I confirm that health expenditure per head in Scotland is 23 per cent. higher than the average for the rest of the United Kingdom. There are also 39 per cent. more health staff in Scotland than in the rest of the United Kingdom and 59 per cent. more hospital beds in Scotland than in England. That is the extent of the Government's commitment to the Health Service in Scotland.
    On the point about the incidence of smoking and so on, the Government, through SHEG—the Scottish Health Education Group—are endeavouring to change attitudes and behaviour. That is the best way to make further progress in preventive medicine.
    Dr. Moonie: I am fascinated by the Minister's description of the success of the Health Service in Scotland. It bears little resemblance to my experience of the reality over the past 10 years. Will he turn his attention to the provision of community care in Scotland? Will he perhaps let the House know when the Government will make some necessary short-term commitment, as agreed by health boards, local authorities of whatever political colour and voluntary groups, to ensure the success of community care for the mentally ill and mentally handicapped?
    Mr. Forsyth: I am grateful for the hon. Gentleman's question. As he knows, the Government have placed considerable emphasis on the importance of community care and achieving a gradual shift of elderly, mentally and physically handicapped people into the community. We

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    have encouraged health boards and local authorities to give high priority to the provision of community care facilities. However, there will be a need for some patients to remain in long-stay accommodation.
    We have increased funding for health boards by 8·4 per cent. in the current year, which, by any standards, is substantial. Fife has benefited considerably from SHARE. An extra £7·6 million was allocated to the board because of the existence of SHARE.

    Rating Reform
    Mr. Harry Ewingasked the Secretary of State for Scotland if he has any plans to bring forward modifications to the community charge scheme in Scotland in the proposed legislation introducing a similar tax in England and Wales; and if he will make a statement.
    The Minister of State, Scottish Office (Mr. Ian Lang): My right hon. and learned Friend expects that the fundamentals of the reforms to be proposed for England and Wales will be comparable with those already enacted for Scotland in the Abolition of Domestic Rates Etc. (Scotland) Act 1987. If changes are made to these proposals, he will, of course, consider whether any parallel changes need to be made to the 1987 Act.
    Mr. Ewing: During the summer recess, will the Minister, together with the Secretary of State, give most serious consideration to the proposal not to implement the poll tax in Scotland until the measure has been fully implemented in England and Wales? Does the hon. Gentleman understand some of the anomalies that will arise if he goes ahead and implements the poll tax in Scotland in advance of its implementation in England and Wales? Nurses who are training in nursing colleges in Scotland will pay the poll tax, and their colleagues in England and Wales will not; policemen in Scotland will pay the poll tax, and policemen in England and Wales will not; service men stationed at Glencorse barracks will pay the poll tax, and service men stationed at Catterick will not. Why does the Minister not gather all copies of the Act, take them to a site in south Edinburgh, get Michael Ancram to set them on fire, and put an end to the whole stupid carry-on?
    Mr. Lang: One of the qualities of the House of Commons is its capacity to accommodate the separate need for Scottish legislation quickly and effectively. We brought forward the Abolition of Domestic Rates Etc. (Scotland) Bill to meet a pressing need in Scotland arising from the injustice that is faced by ratepayers. We are meeting that need. The implementation of the Act cannot come soon enough to bring that relief to Scottish ratepayers.
    Mr. Allan Stewart: Does my hon. Friend recall the remarkable ease with which the Abolition of Domestic Rates Etc. (Scotland) Act 1987 went through Committee? Earlier this week, the supposed great assault by the Labour party on local authority finance in Scotland ended in the humiliating fiasco of only 80 Labour Members staying for the final vote. Is it not clear that the Labour party's opposition to such matters is limited to making a lot of noise during the day? Labour Members will not stay and fight after midnight because they do not have the guts for it.
    Mr. Lang: My hon. Friend is absolutely right. In so far as the Labour party has any discernible policies on the matter, they are wedded to the discredited and regressive rates system. That is an intolerable system and we cannot accommodate it any longer.
    Mr. Wilson: Does the Minister agree that it would be extraordinary if, with a majority of 180 in England and Wales, the Government were frit to introduce the poll tax in England and Wales this side of the next general election, but, with a minority of 62 in Scotland, decided to proceed with it in advance of that date, despite the humiliation that they suffered in Scotland on 11 June?
    Mr. Lang: I am happy to reassure the hon. Gentleman that reform of the domestic rating system is a United Kingdom policy for which we have a United Kingdom mandate. The Scottish part has already been implemented and the English part will be implemented very soon.
    Mr. Bill Walker: When considering amendments to the community charge in the light of what happens when the measure for England and Wales passes through the House, will my hon. Friend bear in mind that one of the great advantages of the community charge is that people will be paying for what they vote for? That being so, might it not be a good thing for the Government to consider having no rebates at all and insisting that everyone pays the full amount so that those in receipt of public support, whether they be students or people on supplementary benefit or pensions, had the average United Kingdom community charge level paid to them, which would encourage people still further to vote for low-spending authorities?
    Mr. Lang: I shall have to reflect on my hon. Friend's recommendations. One of the merits of the community charge is that it is a simpler and fairer system which takes account of the capacity to pay. The rebate system is an important and integral part of it.
    Mr. Worthington: The Minister will be aware that directors of finance believe that only 80 per cent. of the poll tax levied will be recovered from payers of the tax. By what amount does he advise local authorities to increase the poll tax for those paying it to compensate for that level of under-recovery?
    Mr. Lang: The figure of 80 per cent. was the outside limit of a range from 80 to 95 per cent. The hon. Gentleman is therefore mistaken in his assumption. The vast majority of people are law abiding, the Act is now the law of the land, and we can expect that most people will pay it.
    Mrs. Margaret Ewing: Will the Minister bear in mind that Conservatives were abolished north of the border almost as quickly as English Conservatives rushed through the Lobby to make the people of Scotland guinea pigs in the poll tax legislation? The Minister has not changed his mind since the election. Is he aware that almost every section of the community in Scotland is angry about implementation of the poll tax and that both the business community and the Church have been alienated from the Conservatives? Will the Minister reconsider the Government's failure to honour their promise in the White Paper "Paying for Local Government" that the churches would be exempt from poll tax?
    Mr. Lang: I shall try to answer some of the hon. Lady's questions, although I am not sure whether she is claiming

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    that the Scottish National party has a mandate to govern in Scotland. As the community charge is a personal tax, I should have thought that ministers of the Church of Scotland and other churhes would wish to pay it in the same way as other members of their community.
    Mr. Fairbairn: Will my hon. Friend catch the drift of the questions from the Opposition and comprehend that if they have a mandate to govern in Scotland it follows that they have no mandate to govern in England? May we therefore assume that none of the Opposition, few of whom bothered to vote on Scottish matters the other night, will vote on the introduction of the poll tax in England?
    Mr. Lang: Like my hon. and learned Friend, I find the whole concept of a Scottish mandate incomprehensible, the more so since the Labour party has abandoned half the policies on which it fought the general election.
    Mr. Dewar: The electorate last month told the Government in no uncertain terms that the poll tax was unwantable, unworkable and ought to be abandoned. If the Minister insists on ignoring Scottish opinion, does he share the expressed view of the Secretary of State that it would be wrong to have different local tax systems in operation north and south of the border? As implementation of the poll tax in England is unlikely before the mid-1990s, does he agree that a gap of five years between full implementation in the two countries is totally unacceptable? Despite what the Minister has said today, will he give an assurance that he will reconsider the situation and ensure that the timetable for the introduction of the tax in Scotland will be delayed so as to overcome that difficulty?
    Mr. Lang: I really do not recognise the difficulties that the hon. Gentlemen discerns. It was in response to representations from the Labour party, from COSLA and from others that we decided that phasing-in was not appropriate for Scotland. I hope that the hon. Gentleman is not now claiming that the Labour party has a mandate to govern in England.

    Scottish Assembly
    Mr. Doran askedthe Secretary of State for Scotland if he will hold discussions with a view to setting up a Scottish Assembly with legislative powers.
    Mr. Tom Clarkeasked the Secretary of State for Scotland if he will hold discussions with a view to setting up a Scottish Assembly with legislative powers.
    The Secretary of State for Scotland (Mr. Malcolm Rifkind): I have no proposals for setting up a Scottish Assembly.
    Mr. Doran: Given that during the recent election campaign the Conservative party gave a commitment to enter into discussions on the future government of Scotland if there was evidence of a demand for an Assembly, and given that the Scottish electorate answered that question clearly—76 per cent. voted in favour of parties that favoured devolution—will the right hon. and learned Gentleman advise the House when those discussions will begin and what form they will take?
    Mr. Rifkind: The hon. Gentleman's premise is surprising, particularly as he comes from a part of Scotland that voted overwhelmingly against the Scottish
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    Assembly when the referendum took place. lie should be more aware than most people that in the Grampian region, from which he comes, feelings have always been expressed in a manner adverse to the concept of a Scottish Assembly because of the damaging consequences that it is perceived it would have on Aberdeen and on the north-east region of Scotland as a whole.
    Mr. Clarke: Does the Secretary of State recall that the superficial negotiations that took place with COSLA over rate support grant led to a one-and-a-half hour debate in the House and that the decision then taken has an input and influence upon every family and household in Scotland? Is that accountability? Why does the Secretary of State not adhere to his personal views on these matters? Why does he not honour Lord Home's intervention in the referendum and, above all, why does he not respect the overwhelming view of the people of Scotland as expressed on 11 June?
    Mr. Rifkind: The hon. Gentleman should appreciate that the time spent on Scottish rate support grant orders is exactly the time spent on English rate support grant orders. Why the hon. Gentleman should conclude that this is an unsatisfactory amount of time in respect of Scotland but not in respect of the rest of the United Kingdom I find difficult to comprehend.
    Mr. Arnold: Will my right hon. and learned Friend make it absolutely clear that he is opposed to devolution?
    Mr. Rifkind: I have always expressed, and still express, the view that any form of devolution that proposes within a unitary state a devolved system of government for one part of the United Kingdom without any consequential changes for other parts of the United Kingdom is profoundly unworkable and is likely to lead to severe strains of an undesirable kind.
    Mr. Foulkes: Is the Secretary of State aware that since the election, now that they are free to say exactly what they believe, Councillors Struan Stevenson, Murray Tosh and, above all, his close confidant Brian Meek have all said that they strongly favour a Scottish Assembly? I know that deep down the Secretary of State for Scotland also supports a Scottish Assembly. Therefore, will he now show that he has some conviction, some guts and some sincerity and give some indication that at the very least he will set up some sort of group to examine the possibility of a Scottish Assembly in accordance with the wishes of the people of Scotland?
    Mr. Rifkind: I recall that almost 750,000 people in Scotland voted for the Conservative party. The fact that the hon. Gentleman is able to identify three people who share his views on devolution is unlikely to persuade me of his argument.
    Mr. Salmond: I am interested in the fact that the Secretary of State spoke confidently for the Grampian region, given that there are twice as many SNP Members of Parliament as Tory Members of Parliament in the region. Given that the Conservative party in Scotland stood on a separate manifesto, which was separately tested and separately rejected, how can he possibly maintain that the Government have a mandate to impose their policies on an unwilling country? Does he believe that if the Labour party were less confused on the mandate issue he would have more difficulty in sustaining what is in truth an untenable position?
    Mr. Rifkind: I remind the hon. Gentleman, first, that the Conservative party received more votes in Grampian region than any other Scottish party, and, secondly, that the Conservative party in Scotland fought and won the general election on a United Kingdom manifesto.
    Sir Hector Monro: Has my right hon. and learned Friend made any calculation of the reduction in the numbers of Scottish Members of Parliament if there were an Assembly? Would there not be severe casualties in the Labour party in the central belt? Is it not rather odd that the Opposition are calling for a Scottish Assembly, yet supporting a Welshman as their leader in Westminster?
    Mr. Rifkind: Not only would the creation of an Assembly of the kind proposed by the Labour party inevitably lead to a reduction in Scottish representation in the House of Commons, but one is entitled to assume that the achievement of what could be called Scottish home rule would lead inevitably to an expectation and requirement for English home rule. [Interruption.] Opposition Members express puzzlement about that. If they believe that English Members would be prepared to allow Scottish Members to continue to vote on English domestic legislation when they were no longer able to influence Scottish legislation, they have a profound misunderstanding of the concept of a democratic system of government.
    Mr. Dewar: Will the right hon. and learned Gentleman accept that I am genuinely puzzled by his reference to his personal position and the fact that he has always thought it wrong to have a one-off Scottish solution for devolution? I understand that he voted for and supported the devolution settlement in 1978, which was, of course, a one-off Scottish solution. Will he clarify that point? I also understand that the right hon. and learned Gentleman largely jusified his retreat on devolution on the ground that it was unwanted in Scotland. If he is not convinced —as I understand that he is not—by the results of the general election, what evidence is he prepared to accept of Scotland's wish for reform in the structure of government? Does he agree that his presence at the Dispatch Box, blandly denying the reality of Scottish opinion and blandly defying what Scotland wants, is bad for the House and for the country?
    Mr. Rifkind: The hon. Gentleman fought the last election as a member of a party seeking to try to achieve a United Kingdom Government. While 5 million Scots returned 10 Conservative Members of Parliament, 16 million Englishmen in the south of England returned only three Labour Members of Parliament. Is the hon. Gentleman suggesting that a Labour Government, if it had been elected, would have had no mandate in the South of England? I also remember that—[Interruption.]
    Mr. Speaker: Order. I ask hon. Members to give the Secretary of State a fair hearing.
    Mr. Rifkind: I also remember that when these matters——
    Hon. Members: Answer the question.
    Mr. Speaker: Order. The Secretary of State is answering the question.
    Mr. Rifkind: I remember also that when these matters were last discussed, the hon. Gentleman admitted that if devolution ever took place he assumed that there would
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    indeed be consequences for the rest of the United Kingdom. He might like to discuss that with the leader of his party.

    Youth Unemployment
    Mr. Dunnachieasked the Secretary of State for Scotland by how much the percentage level of youth unemployment in Scotland increased between May 1979 and the most recent date for which figures are available.
    Mr. Laing: Because accurate labour force figures are not available by age group, percentage levels cannot be calculated. Unemployment amongst under 20-year-olds in Scotland has fallen in each of the last four years.
    Mr. Dunnachie: I thank the Minister for his reply—[HON. MEMBERS: "Reading."] I can read; hon. Gentlemen cannot.
    Is the Minister aware that in the United Kingdom, excluding Scotland, unemployment among the under-25s fell by 13·7 per cent. between April 1986 and April 1987, while in Scotland it is claimed that it fell by a mere 3 per cent? Is he also aware—[HON. MEMBERS: "Reading."] I can read; hon. Members are unfortunate.
    Is the Minister also aware that Scottish youths have been unemployed for longer periods than their counterparts elsewhere in the United Kingdom? Scottish youngsters have been unemployed on average for more than 28 weeks. What hope can the hon. Gentleman offer those unemployed youngsters?
    Mr. Lang: I am happy to be able to tell the hon. Gentleman that unemployment in Scotland among 18-year-olds fell by 12 per cent. in the past year and unemployment among school leavers is 3,700 lower than —[HON. MEMBERS: "Reading".] The hon. Gentleman asked me what hope I could offer to young Scottish unemployed people. I offer them the hope that they will find in the Fraser of Allander Scottish business survey published today, which is the most optimistic to be published since the survey began.
    Mr. Hind: Is my hon. Friend aware that Conservative Members are fed up to the back teeth with the carping of Scottish Members? [Interruption.] Is he not also aware that although there may be young people in Scotland who may have been unemployed for a long time —[Interruption.]
    Mr. Speaker: Order. I think that provocative statements do not help.
    Mr. Hind: Is my hon. Friend aware that the levels of unemployment among young people under the age of 25 in the United Kingdom are lower than in any other country in the EEC? Those of us in the north of England and other regions in the United Kingdom have similar problems, but we are not complaining so bitterly about them, while Scotland is doing so much better than we are in the northern region.
    Mr. Lang: My hon. Friend is absolutely right. Unemployment among under-25-year-olds fell by 14 per cent. in the United Kingdom last year, which was much more than in the rest of the European Community. I am glad that the north of England, like Scotland and all the other parts of the United Kingdom, is now sharing in the fall in unemployment generally, the rise in economic activity and continuing low levels of inflation.
    Mr. Strang: Did either the Minister or his right hon. and learned Friend the Secretary of State for Scotland gain any impression of the scale of despair among Scotland's young people over the mass unemployment that they are experiencing? Does the Minister recognise that the two-year YTS and the fact that so many young people are driven away from their homes to find work in the south of England are utterly unacceptable? The figures do not reflect the situation and the young people in Scotland are seeing the waste of the whole generation.
    Mr. Lang: The hon. Gentleman is talking nonsense. Unemployment in Scotland has fallen by 40,000 in the past 20 weeks. As I said a moment ago, the Fraser of Allander Scottish business survey is the most optimistic since the survey began. It offers encouragement in manufacturing, construction, retailing and increased employment in those sectors and more is expected in the months to come.
    Mr. Kennedy: Given that in the Scottish Highlands historically unemployment has led to depopulation, and given that within the Highlands youth unemployment has been severely increased by the major closures such as Corpach, Invergordon and more recently Kishorn, does the Minister have any specific measures to suggest to arrest the continuing increase in youth unemployment that leads to youth depopulation?
    Mr. Lang: I am sure the hon. Gentleman will welcome the fact that the population in the Highlands is increasing, as is the budget of the Highlands and Islands Development Board. The Highlands, like other parts of Scotland, can share in the youth training scheme, the community programme, the job training scheme and all the other measures that we offer that give training and job opportunities to young people.
    Sir Hector Monro: Does my hon. Friend agree that in June 1986 the number of unemployed school leavers was 17,000, and in June this year the figure was 13,444? Is that not a sign of good news in Scotland, showing that YTS and the many other programmes are working and that the future looks much brighter than it looked some years ago?
    Mr. Lang: My hon. Friend is absolutely correct. It is clear that the best prospects for the youth of Scotland lie in the continuation of this Government's sound economic policies.
    Mr. McLeish: Is the Minister aware that in a report published by the Department of Employment in Scotland last week 31,275 claimant and non-claimant school leavers were registered as unemployed? Is the Minister further aware that 131,000 young Scots under 25 are registered as unemployed? Is he also aware that there are only 400 registered vacancies at careers offices in Scotland? In view of that appalling record, will he bring a report before the House suggesting the steps that he might want to take to tackle that situation?
    Mr. Lang: I have just told the House about the improvement in the trend of all these figures. One of the other figures that I have not yet given the House is the one about vacancies that are advertised at jobcentres. They are now at their highest level for seven years.

    Economic Growth
    Mr. Fairbairnasked the Secretary of State for Scotland if he will list the sectors of the Scottish economy which have experienced improvements since 1979.
    Mr. Rifkind: My hon. and learned Friend will appreciate that time is too short for anything Like a full list. Since 1979 manufacturing productivity in Scotland has gone up by an average of 4·9 per cent. per annum; service sector employment is up by nearly 38,000 and self-employment is up by 45,000. Net company registrations are up by 15,000 and average male weekly earnings are higher than in any other part of the United Kingdom except the south-east. Scotland is now third in terms of personal disposable income per head, behind only the south-east and East Anglia, as compared with sixth in 1979. Since 1981 Locate in Scotland has attracted investment of about £2·3 billion and has helped to create or safeguard over 42,000 jobs in Scotland.
    Mr. Fairbairn: Will my right hon. and learned Friend reflect on the fact that I regret the necessity for brevity on this occasion? The list of economic improvements is long and the benefits that Scotland enjoys, and which no other part of the kingdom enjoys, are huge. Will he use all his efforts to remind the Opposition that if there is a north-south divide at Hadrian's wall all the benefits are north of it in terms of transport, employment, prosperity, inward investment and all the qualities of life?
    Mr. Rifkind: My hon. and learned Friend is right to point out that any fair and objective assessment of the Scottish economy identifies not only the difficulties that Scotland undoubtedly experiences, but the major advantages and achievements that Scotland has realised over the last eight years. Any attempt to concentrate on one factor to the exclusion of the others shows a basic disinterest in the problems that Scotland faces.
    Sir Russell Johnston: As the Secretary of State is in a fair and objective frame of mind, he will agree that there are a great many English Members here who have never before attended Scottish Questions. One can see the wonder in their eyes. Can he explain this sudden surge of intellectual hunger south of the border? Is it because of his own charismatic appeal, or have they been dragged here on the promise that they will not have to go to the Scottish Grand Committee?
    Mr. Rifkind: The hon. Gentleman must make up his mind about what he and other Opposition Members really wish. On the one hand they seek to deplore the lack of interest that English Members allegedly have in Scottish affairs, but when my hon. Friends attend the House and seek to ask intelligent and constructive questions the Opposition take exception to this interest in our affairs. I am delighted to see in this Chamber of the United Kingdom Parliament my colleagues from other parts of the kingdom showing a sensible and constructive interest. Indeed, sometimes they seem to show a better awareness of circumstances in Scotland than do some Opposition Members.
    Mr. Darling: Does the Secretary of State not regret the remarks by the chairman of Guinness plc in the June edition of the Scottish Business Insider, that it now looks unlikely that Guinness will set up its headquarters in Edinburgh, despite promises made at the time of the takeover of Distillers? Does he not accept that the proposal to restructure Distillers into a company that might be called United Distillers with those chiefly responsible for running it living largely in the south of England represents a slap in the face for the Scottish

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    business community? Does it not illustrate how powerless the Government are in attracting the very sorts of office and business developments that they say they have managed to generate in other parts of the United Kingdom? Does this not demonstrate that the Government have misplaced their trust in private enterprise? They ought to be doing far more to get jobs into the capital of Scotland.
    Mr. Rifkind: The hon. Gentleman is quite mistaken on his general point. He represents an Edinburgh constituency and should be aware that in recent years Edinburgh has established itself as the second financial centre of the United Kingdom. It has experienced enormous growth in jobs related to the financial sector. The hon. Gentleman asked about Guinness. As Secretary of State for Scotland, my main interest is in where the control of the Scotch whisky aspects of the Guinness company are concentrated rather than in from where Guinness beer is controlled. I understand that thought is being given to some restructuring of the company which may lead to greater and more effective control of the Scotch whisky aspect of Guinness in Scotland. If that turns out to be the case, I am sure that it is something about which we should all be satisfied. However, we must wait and see exactly what the company's proposals will be. I do not think that anyone would dispute that Sir Norman MacFarlane will have Scotland's interests firmly in mind in the work that he does in the company. I understand that he will be anxious to ensure that commitments to Scotland, especially those to the Scotch whisky industry, will be properly honoured.
    Mr. Bill Walker: Does my right hon. and learned Friend agree that, certainly as far as the Scottish economy is concerned, the private sector has performed well in creating new jobs? With regard to the Guinness affair, if I can describe it as that, does my right hon. and learned Friend agree that it is important to ensure that those who did things incorrectly, wrongfully or illegally are dealt with properly? That will happen only when the inspector's report has been presented to the Department of Trade and Industry, and we can then look forward to action in the courts.
    Mr. Rifkind: I agree with my hon. Friend.
    Mr. Maxton: Does the Secretary of State believe that the Scottish Economic Bulletin, which is published by his own Department, is a fair and unbiased account of the Scottish economy? If he does, why does he not accept the view of the bulletin that the Scottish economy is growing considerably less than the United Kingdom economy and that there is no prospect of growth in jobs during the next 12 months?
    Mr. Rifkind: The hon. Gentleman has not given an accurate description of what the bulletin stated. I think he will acknowledge that the bulletin referred to the fact that the Scottish economy is growing—a phenomenon that one would not believe if one listened only to the hon. Gentleman and his hon. Friends. The Scottish Economic Bulletin referred to the setback that occurred last year because of the recession that was then taking place in the North sea oil industry. However, in recent months we have seen a tremendous upturn in the Scottish economy, as evidenced by today's survey published by the Fraser of Allander Institute, which in the past has been perfectly
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    willing to be critical of the Government, but which now reports the most optimistic survey since its reports began. When one adds to that the 40,000 drop in the Scottish unemployment figures in the past 20 weeks alone, hon. Members have to be positively blind not to acknowledge the major progress that is now taking place.

    Industrial Production and Construction
    Mr. Ernie Rossasked the Secretary of State for Scotland if he will give the index of industrial production and construction for Scotland in each of the most recent four quarters for which figures are available and for each of the quarters of 1979.
    The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton): For successive quarters in 1979, the estimates are 102·9, 107·8, 107·7, 107·1, giving an annual figure of 106·4. For successive quarters in 1986, the estimates are 99·8, 99·6, 101·2, 101·7, giving an annual figure of 100·6.
    Mr. Ross: Does the hon. Gentleman agree that if he and his colleagues were to address more helpfully the recent housing document issued by COSLA that would help the construction industry and might put more people in Scotland back to work?
    Lord James Douglas-Hamilton: Substantial funds have been given for housing. For example, £184 million has been paid, which is an increase of 81 per cent. over the past three years. Expenditure on new build has remained relatively constant at about £60 million per year.
    Mr. Steel: Does the Minister agree that the most effective way of giving speedy help to the construction industry would be to restore the house improvement programme in both the private and public sectors? Does he recognise that both the housing authorities in my constituency have plans for house improvement schemes, but with which they cannot proceed because of a lack of funds? Unhappily, I represent the town which still has the highest level of sub-tolerable houses in the private sector in Scotland. Will the Minister make this a priority?
    Lord James Douglas-Hamilton: I thank the right hon. Gentleman for his statement. I shall consider his point, but I should mention that a larger sum has been spent on the housing associations than ever before—more than £120 million this year.
    Mr. Buchanan-Smith: Will my hon. Friend point out to the Labour party what has been achieved on the roads programme in Scotland, for example, the completion to dualling of the Perth to Aberdeen road, and the upgrading of the A74 to a motorway? Does that not suggest the good prospects for the construction industry in Scotland under a Conservative Government?
    Lord James Douglas-Hamilton: About £95 million is being spent and will make a considerable difference to employment by encouraging tourism. It is very much in the national interest.
    Mr. Dewar: To return to productivity and the economy generally, will the Minister comment on page 7 of the Scottish Economic Bulletin, where there are undoubtedly references to certain hopeful signs, as the Government see them, especially the growth in self-employment. However, it continues:
    "it seems doubtful whether the sources of growth will be sufficient to lead to any overall increase in the current year."

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    The final sentence of the review states:
    "it is not yet clear how far the changes reflect an improvement in the underlying labour market position in Scotland."
    Do those judgments in any way justify the complacency shown by the Secretary of State a few moments ago?
    Lord James Douglas-Hamilton: The surveys have been encouraging, especially the Fraser of Allander Institute survey, which has come out today. It states that employment has increased in manufacturing, construction and retailing in the second quarter and that this is likely to continue. Unemployment has fallen by 40,000 and vacancies at Scottish jobcentres are at their highest levels since March 1980. These are encouraging signs.

    Local and Health Authority Contracts
    Mr. Gerald Howarthasked the Secretary of State for Scotland what information he has as to how many local and health authority contracts have been put out to competitive tender in Scotland.
    Mr. Michael Forsyth: Details of the number of local and health authority contracts put out to competitive tender are not available centrally. However, the most reliable figures available show that of local authority works subject to competition under the Local Government, Planning and Land Act 1980, 58·8 per cent. was undertaken by the private sector. Since 1985, 29 contracts for support services have been let in the Health Service.
    Mr. Howarth: Does my hon. Friend agree that that is a pathetically small figure and compares most unfavourably with England and Wales, where savings of 25 per cent. have been achieved, compared with the 10 per cent. saving achieved in Scotland? Is he aware that private contractors wish to bid? Is it not disgraceful that five of the 15 health boards refuse to go out to tender? Will he please ensure that Scotland has the full benefit of Conservatism?
    Mr. Forsyth: I am grateful to my hon. Friend, who has obviously made a close study of this matter. He will have seen that the recent National Audit Office report concluded that slow progress in contracting out in Scotland was due to a lack of availability of private contractors, strong opposition to the initiative from the trade unions and structural reorganisation within the National Health Service. I can assure my hon. Friend that I shall examine these matters closely in the coming weeks.
    Mrs. Fyfe: Is the Minister aware that when the canteen provision at the Glasgow college of technology was recently privatised wages were frozen at £2·20 an hour? Will he undertake to assure Scottish canteen workers in health and local authorities that their pay will be better when privatisation is forced on them?
    Mr. Forsyth: It is not my responsibility to ensure that the pay of canteen workers or of anyone else is held at a particular level. I am responsible for ensuring that maximum resources are directed to patient care and our policies are geared to that purpose.
    Mr. Norman Hogg: Is it not the case that the best means of providing support services in the Health Service is a matter for the health boards to determine? Is it not also the case that the health boards are appointed by the Secretary of State for Scotland, so are largely
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    Conservative? If the Minister does not accept from me that nobody in the Health Service wants privatisation, will he accept that view from the largely Tory-controlled health boards, about which the hon. Member for Cannock and Burntwood (Mr. Howarth) complains?
    Mr. Forsyth: First, I take this opportunity of welcoming the hon. Gentleman to the Dispatch Box from the turmoil of the Whips' Office. He asserts that because health boards are appointed by the Secretary of State they must be Conservative-dominated. That will be a considerable surprise, but I note his expectation. I am sure he will agree that all health hoards will be committed to ensuring that every penny is directed towards patient care. Therefore, it should not be a matter of conflict between us that if tendering for services results in the best value for money in patient care it should be welcomed on all sides and certainly by health boards.
    Mr. Neil Hamiltonasked the Secretary of State for Scotland what action he proposes to take in response to the publication of the National Audit Office's opinion that expansion of competitive tendering in the National Health Service in Scotland has been too slow.
    Mr. Michael Forsyth: I shall be discussing progress on competitive tendering of support services with Health Board chairmen in the light of the National Audit Office report and our manifesto commitment. Boards were asked in 1984 to ensure that all support services had been put out to tender by April 1988.
    Mr. Hamilton: I thank my hon. Friend for that reply. However, does he agree that, while discussions are all very well, what we want is action? Is he aware that, according to the recently published National Audit Office report, £5·9 million has already been saved by contracting out and in-house services provided under the pressure of the threat of contracting out, but that potential savings of between another £9 million and £15 million could be looked for? Are not the Scottish health boards robbing the taxpayers of the United Kingdom, and those who might otherwise benefit from an improved level of services in their areas? What can he done?
    Mr. Forsyth: The only way in which to ensure that we are able to realise all the possible savings is to ensure that the efficiency of in-house services is tested against outside competition. My hon. Friend is right to point out that even the threat of privatisation seems mysteriously to produce savings, and there has been some progress in that respect. To date, savings in Scotland amount to about 10 per cent. In England, they are between 20 and 30 per cent. There is a great deal to be done in Scotland if our priority is to ensure that patient care is maximised.
    Mr Galloway: The Scottish people decisively rejected the thieves' charter of privatisation just a few weeks ago. Scottish Ministers have come here today buttressed by the motley crew of English placemen and deracinated Scotsmen to ignore the salient points——
    Mr. Speaker: Order. The hon. Gentleman must ask a question.
    Mr. Galloway: The question is this, Sir. When will those Ministers, with the green acres stretched out behind them where their Scottish colleagues used to be, come to terms with the fact that 78 per cent. of the Scottish people and 62 out of 72 Scottish Members of Parliament reject them and everything that they stand for?
    Mr. Forsyth: I read in yesterday's Glasgow Evening Times that the hon. Gentleman was concerned about the provision of kidney machines and that he was going to have a meeting with me about it. I look forward to that, because when he comes to see me I shall point out that the savings that the NAO report estimates could be made from tendering in Scotland of between £15 million and £22 million are roughly equivalent to the cost of the purchase of 1,500 kidney dialysis machines.
    Mr. Allan Stewart: Is my hon. Friend aware that some of the Scottish health boards have been up to some tricks, including, for example, the award of an in-house contract at up to 50 per cent. more than private contractors would have charged? In the light of that, will he in the course of his consideration agree to meet representatives of the industries concerned to hear from them what they think are the opportunities and the problems?
    Mr. Forsyth: I should be delighted to meet any such representatives to get to the bottom of the problem identified in the NAO report of an apparent lack of interest on the part of private contractors. It is essential that the cost of in-house operations is properly examined, and comparison is made on a like-for-like, apples-for-apples basis. When in-house savings are promised, we must have proper procedures to monitor them, and to ensure that they are achieved.

    Steel Industry
    Dr. Brayasked the Secretary of State for Scotland if he will make a statement about the future of the steel industry in Scotland.
    Mr. Millanasked the Secretary of State for Scotland if he will make it his policy that Ravenscraig steelworks will not be closed during the lifetime of the present Parliament.
    Mr. Rifkind: The future of the steel industry in Scotland depends on the health of the British Steel Corporation. I am sure the House will share my delight at the healthy profits announced recently by the corporation.
    Dr. Bray: Is the Secretary of State aware that Ravenscraig contributed substantially to those profits? Is he further aware that we are looking, not just for an extension of the short-term guarantee to Ravenscraig as an integrated steel producer, but for long-term investment in modernisation, new products and new processes to take Ravenscraig into the next century as a high-tech steel producer of both plate and strip?
    Mr. Rifkind: I agree with the hon. Gentleman that Ravenscraig has contributed in a valuable and important way to the profitability of the British Steel Corporation, and I congratulate the management and work force of Ravenscraig, who have achieved records in both productivity and output. The hon. Gentleman knows that the British Steel Corporation has announced £30 million of varied investment in Ravenscraig. That demonstrates a commitment to the plant. I hope that it will help to ensure a very long and healthy future for the plant.
    Mr. Millan: As the Secretary of State has just acknowledged that Ravenscraig is now a profitable plant, with record levels of output and the highest level of productivity of any steelworks in the United Kingdom, why cannot it be guaranteed a long-term future? Why
    366
    should it have to live from hand to mouth, with only the guarantee of continued existence to August 1988? We want a long-term guarantee for Ravenscraig, with the long-term investment that is so necessary there.
    Mr. Rifkind: As the right hon. Gentleman knows, the next stage is for the British Steel Corporation to put forward its strategic plans for the future of the industry. I very much hope that when it puts its proposals before the Government the BSC will take into account the productivity and the output of Ravenscraig and the contribution that it has made to the profitability of BSC.
    Mr. Buchanan-Smith: In any consideration that the Government give to the investment plans of the British Steel Corporation, will my right hon. and learned Friend undertake to ensure that British Steel is able to produce those quality products, for which there is a demand in Scotland, particularly from the offshore industry, to maximise the contribution of British industry to the offshore industry?
    Mr. Rifkind: My right hon. Friend is absolutely correct. I am sure the House will agree that the best guarantee for Ravenscraig and for the other plants in Scotland will be if they are able to produce the types of steel for which there is a demand and a market, thereby ensuring their relevance to the health and prosperity of the steel industry as a whole.
    Dr. Reid: Will the Secretary of State take this opportunity to end once and for all the speculation regarding the future of Ravenscraig? Is he aware of the feelings of the people in Scotland? Unlike some of the synthetic Scots who are sitting on the Conservative Benches, is he not aware that Ravenscraig has become a political as well as an industrial symbol? Is he aware that there was further speculation this morning in The Times that a statement made by the Industry Commissioner in Europe may result in the closure of Ravenscraig? Congratulations to the workers at Ravenscraig are cheap. The Secretary of State should give them real commendation today by stating that their future is secure. He should give a guarantee today to a work force who have beaten every record in the book that the investment will be there so that their efforts are matched by his guarantees.
    Mr. Rifkind: The Government have shown their commitment to Ravenscraig in an unmistakable way. Ravenscraig was kept as part of the British Steel Corporation's activities, even at a time when the British Steel Corporation was making enormous losses because of the failure of the Labour Government to approach the needs of a modern steel industry in an efficient and sensible manner. If the Government recognised the importance of Ravenscraig to the Scottish economy when the British Steel Corporation was making massive losses, I am sure that the hon. Gentleman will agree with me that Ravenscraig's position today must be infinitely healthier, since it is now part, thanks to this Government's policies, of a healthy and profitable steel industry.
    Mr. Andy Stewart: Having heard from Ministers about the rosy picture in Scotland, I am almost tempted to return. With the co-operation of south Wales miners, British Coal is to produce coking coal. Will this not protect and ensure the long-term future of Ravenscraig?
    Mr. Rifkind: We are naturally interested in any developments that will help to ensure that future.

    367
    Ultimately, the future of Ravenscraig, as of every steel plant in the United Kingdom, depends upon its productivity and output. Its output must consist of products for which there is a market both at home and abroad. That is the best guarantee, not only for Ravenscraig but for any factory or industry in the United Kingdom.
    Mr. Maxton: Has the Secretary of State received a copy of the EEC report which asks the steel industry to cut production by 30 million tonnes and to shed 80,000 jobs over the next three years? If he has received that report, what guarantee will he give to Ravenscraig that it will stay open? Will he ensure that that happens? Indeed, will he put his own job on the line and make it clear to the House that if British Steel closes Ravenscraig, he and his Ministers will resign?
    Mr. Rifkind: The hon. Gentleman does not understand the degree of disservice that he does to Ravenscraig. By assuming, as he appears to be doing, that any necessary reduction in British Steel manpower has to be at the expense of Ravenscraig, he serves only to give comfort to those who argue that Ravenscraig is the weakest element of British Steel's activities. If he has Ravenscraig's interests at heart, he should emphasise the advantages that Ravenscraig offers for British Steel and its valuable contribution to British Steel's overall output. So far, his remarks have been positively damaging to the steel industry in Scotland.

    NHS (Pay)
    Dr. Moonieasked the Secretary of State for Scotland whether he has now revised his Department's estimate of the share of the cost of meeting the recent National Health Service pay awards payable by health boards out of their current allocation; and if he will make a statement.
    Mr. Michael Forsyth: No. The additional £35 million made available by the Government on top of the original provision of £1,545 million for the hospital and community health programme will result in a total increase in provision this year of 8·4 per cent. In addition, efficiency measures should direct the equivalent of 1·5 per cent. of revenue allocations into direct patient care. This will allow boards to meet increased costs and to develop services.
    Dr. Moonie: The Minister's reply is disingenuous, to say the least. I am fully aware that, for at least one health board, the gap between the Scottish Office's estimate of what will have to be met out of current allocation and the reality is £250,000. Where is the health board supposed to find that money?
    Mr. Forsyth: The difference between the £35 million made available and the costs are based on estimates provided by the boards——
    Dr. Moonie: They are wrong.
    Mr. Forsyth: Well, they may be wrong, but they were provided by the boards themselves. I see no need to revise that estimate or to accept the hon. Gentleman's view that it is wrong. I should have thought that the health boards and, indeed, the hon. Gentleman, would welcome the fact that the Government have made available £35 million extra, as announced in May, on top of what the health boards were expecting in March.
    Several hon. Members: On a point of order.
    Mr. Speaker: I shall take points of order after the statement.
    Mr. Canavan: On a point of order, Mr. Speaker.
    Mr. Douglas: On a point of order, Mr. Speaker.
    Several Hon. Members rose——
    Mr. Speaker: Order. The House knows that there has been a rule about this matter for some time now.
    Mr. Douglas: On a point of order, Mr. Speaker.
    Mr. Canavan: On a point of order, Mr. Speaker.
    Mr. Speaker: Order.
    Mr. Canavan: I spy Strangers.
    Mr. Speaker: Order.
    Mr. Canavan: If you will not take my point of order, Sir, I spy Strangers.
    Mr. Speaker: I will not take the hon. Gentleman's point of order.
    Mr. Canavan: I spy Strangers.
    Mr. Speaker: Order.
    Mr. Canavan: I spy Strangers, and they are all on the Conservative Benches, and they were in here for Scottish questions.
    Mr. Speaker: Order. I must say to the hon. Gentleman that this takes time out of the debate.
    Mr. Canavan: I spy Strangers.
    Notice being taken that Strangers were present, MR. SPEAKER, pursuant to Standing Order No. 143 ( Withdrawal of strangers from House), put forthwith the Question, That Strangers do withdraw:—
    The House divided: Ayes 41, Noes 161.

    Division No. 27]

    [3.35 pm

    AYES

    Bermingham, Gerald

    McKelvey, William

    Campbell, Ron (Blyth Valley)

    McLeish, Henry

    Campbell-Savours, D. N.

    Mahon, Mrs Alice

    Clay, Bob

    Marshall, David (Shettleston)

    Corbyn, Jeremy

    Martlew, Eric

    Cryer, Bob

    Meale, Alan

    Cunliffe, Lawrence

    Michael, Alun

    Duffy, A. E. P.

    Michie, Bill (Sheffield Heeley)

    Dunnachie, James

    Mowlam, Mrs Marjorie

    Ewing, Mrs Margaret (Moray)

    Parry, Robert

    Faulds, Andrew

    Patchett, Terry

    Fields, Terry (L'pool B G'n)

    Salmond, Alex

    Fyfe, Mrs Maria

    Sheerman, Barry

    Galloway, George

    Thomas, Dafydd Elis

    Graham, Thomas

    Turner, Dennis

    Grant, Bernie (Tottenham)

    Wigley, Dafydd

    Griffiths, Nigel (Edinburgh S)

    Worthington, Anthony

    Heffer, Eric S.

    Wray, James

    Lambie, David

    McAllion, John

    Tellers for the Ayes:

    McCartney, Ian

    Mr. Dennis Canavan and

    Macdonald, Calum

    Mr. Bob McTaggart.

    McFall, John

    369

    NOES

    Adley, Robert

    Fox, Sir Marcus

    Alexander, Richard

    Fry, Peter

    Arbuthnot, James

    Gale, Roger

    Arnold, Jacques (Gravesham)

    Gardiner, George

    Baker, Rt Hon K. (Mole Valley)

    Garel-Jones, Tristan

    Batiste, Spencer

    Glyn, Dr Alan

    Beaumont-Dark, Anthony

    Goodson-Wickes, Dr Charles

    Bennett, Nicholas (Pembroke)

    Gorman, Mrs Teresa

    Biggs-Davison, Sir John

    Gow, Ian

    Body, Sir Richard

    Greenway, Harry (Ealing N)

    Boscawen, Hon Robert

    Greenway, John (Rydale)

    Boswell, Tim

    Gregory, Conal

    Bottomley, Mrs Virginia

    Hamilton, Neil (Tatton)

    Bowden, Gerald (Dulwich)

    Hanley, Jeremy

    Buchanan-Smith, Rt Hon Alick

    Hargreaves, A. (B'ham H'll Gr')

    Burns, Simon

    Hargreaves, Ken (Hyndburn)

    Burt, Alistair

    Harris, David

    Butler, Chris

    Haselhurst, Alan

    Butterfill, John

    Hayes, Jerry

    Carlisle, John, (Luton N)

    Hayward, Robert

    Carlisle, Kenneth (Lincoln)

    Heddle, John

    Carrington, Matthew

    Hicks, Mrs Maureen (Wolv' NE)

    Carttiss, Michael

    Hill, James

    Cash, William

    Hind, Kenneth

    Chapman, Sydney

    Holt, Richard

    Coombs, Anthony (Wyre F'rest)

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

    Coombs, Simon (Swindon)

    Howarth, G. (Cannock & B'wd)

    Currie, Mrs Edwina

    Howell, Ralph (North Norfolk)

    Curry, David

    Hughes, Robert G. (Harrow W)

    Day, Stephen

    Hunt, David (Wirral W)

    Dorrell, Stephen

    Hunt, John (Ravensbourne)

    Douglas-Hamilton, Lord James

    Hunter, Andrew

    Durant, Tony

    Irvine, Michael

    Dykes, Hugh

    Jack, Michael

    Emery, Sir Peter

    Jones, Gwilym (Cardiff N)

    Fairbairn, Nicholas

    Jopling, Rt Hon Michael

    Fallon, Michael

    Key, Robert

    Favell, Tony

    King, Roger (B'ham N'thfield)

    Finsberg, Sir Geoffrey

    Knapman, Roger

    Fookes, Miss Janet

    Knowles, Michael

    Forsyth, Michael (Stirling)

    Lang, Ian

    Forth, Eric

    Latham, Michael

    370

    Leigh, Edward (Gainsbor'gh)

    Ryder, Richard

    Lloyd, Sir Ian (Havant)

    Sackville, Hon Tom

    Lord, Michael

    Shephard, Mrs G. (Norfolk SW)

    Maclean, David

    Shepherd, Colin (Hereford)

    McLoughlin, Patrick

    Shepherd, Richard (Aldridge)

    Mans, Keith

    Sims, Roger

    Maples, John

    Skeet, Sir Trevor

    Marland, Paul

    Smith, Sir Dudley (Warwick)

    Marshall, John (Hendon S)

    Speed, Keith

    Marshall, Michael (Arundel)

    Speller, Tony

    Martin, David (Portsmouth S)

    Steen, Anthony

    Maude, Hon Francis

    Stern, Michael

    Meyer, Sir Anthony

    Stevens, Lewis

    Mills, Iain

    Stewart, Allan (Eastwood)

    Mitchell, Andrew (Gedling)

    Stewart, Andrew (Sherwood)

    Monro, Sir Hector

    Stradling Thomas, Sir John

    Montgomery, Sir Fergus

    Tapsell, Sir Peter

    Moore, Rt Hon John

    Taylor, John M (Solihull)

    Morris, M (N'hampton S)

    Thompson, Patrick (Norwich N)

    Moss, Malcolm

    Thorne, Neil

    Neale, Gerrard

    Thurnham, Peter

    Neubert, Michael

    Tredinnick, David

    Onslow, Cranley

    Twinn, Dr Ian

    Oppenheim, Phillip

    Vaughan, Sir Gerard

    Page, Richard

    Waddington, Rt Hon David

    Paice, James

    Wakeham, Rt Hon John

    Patnick, Irvine

    Walker, Bill (T'side North)

    Pawsey, James

    Waller, Gary

    Porter, Barry (Wirral S)

    Walters, Dennis

    Porter, David (Waveney)

    Warren, Kenneth

    Portillo, Michael

    Watts, John

    Powell, William (Corby)

    Whitney, Ray

    Price, Sir David

    Widdecombe, Miss Ann

    Redwood, John

    Wiggin, Jerry

    Rhodes James, Robert

    Yeo, Tim

    Rhys Williams, Sir Brandon

    Young, Sir George (Acton)

    Riddick, Graham

    Rifkind, Rt Hon Malcolm

    Tellers for the Noes:

    Rost, Peter

    Mr. David Lightbown and

    Rumbold, Mrs Angela

    Mr. Mark Lennox-Boyd.

    Question accordingly negatived.

Polytechnics and Inner London
3.44 pm
The Secretary of State for Education and Science (Mr. Kenneth Baker): With permission, Mr. Speaker, I should like to make a statement.
In our White Paper on higher education, we gave notice of our intention to legislate to re-establish the polytechnics and certain local authority maintained colleges as freestanding corporate bodies outside local authority control. The White Paper indicated that the new funding arrangements would also apply to certain institutions assisted by local education authorities. We expressed confidence that the local authorities would, in the intervening period before the legislation was enacted, continue to act responsibly in the funding of the institutions due for transfer and the upkeep of their plant. I remain confident that the great majority of authorities will act responsibly, but it has come to my attention that a small number of local authorities are planning or taking steps which would either deprive the polytechnic or college concerned of assets which it needs for effective operation or would seriously encumber those assets.
Regrettably, that makes it necessary for me to take action to protect those institutions. I am not prepared to allow the interests of present and future students to be put at risk in this way. It is neither in the local nor the national interest that damage should be done to the education these institutions do and still continue to provide. I therefore propose to seek Parliament's approval in the forthcoming legislation to a measure whereby my specific consent will be required for all disposals by local education authorities of land or interests in land, including buildings, used or held or obtained for or in connection with the purposes of these institutions. These are the ones which I intend to be freestanding corporate bodies together with those institutions which are presently assisted by local education authorities and which I intend should become funded by the Polytechnics and Colleges Funding Council. The names of the institutions are set out in my separate written answer to my hon. Friend the Member for Altrincham and Sale (Sir F. Montgomery).
The disposals of land or interests in land requiring my consent will include outright sale, granting or otherwise disposing of any leasehold or other interest in land, direct sale and leaseback, any mortgage or other charge designed to raise capital on the security of the land. It will also include any disposal which is made in return for the supply of goods or services. In referring to disposals I include entering into any binding obligation to make a disposal of the kind in question.
Similarly, in relation to our proposals to allow inner London authorities to apply to take over from the inner London education authority the responsibilities of the local education authority for their areas, the Government have decided to include provisions within the legislation requiring ILEA to obtain my consent in advance to the following actions. The first is any disposal of land or interests in land including buildings—used or held or obtained for or in connection with their education functions. Disposals will he as in the case of polytechnics and colleges. The second is any contract for a consideration having a value in excess of £15,000. In
372
considering whether to give my consent, I may seek the views of parties affected, including any inner London authority with a potential interest in the transaction.
I shall seek Parliament's approval to the provisions both for the polytechnics and colleges and for ILEA having effect from midnight tonight. This statement does not affect enforceable obligations entered into before midnight tonight.
I shall also seek Parliament's approval for certain sanctions where my consent has not been obtained in advance. For the disposal of land or interests in land without my consent, there will he a power of compulsory purchase with a right of recovery from the local authority or from ILEA of any compensation payable. In the case of contracts, including contracts for disposal, which I have mentioned, entered into without my consent, there will be a right of repudiation, and such repudiation will be deemed to be a repudiation by ILEA or the relevant local authority, so that any liability in damages will remain with ILEA or the relevant local authority.
My Department is today writing to all local education authorities which currently maintain or assist polytechnics or colleges affected by the legislation and to ILEA and the inner London authorities to explain how these provisions will be applied.
I shall continue to monitor the activities of maintaining and assisting local authorities, and of ILEA in particular, and shall not hesitate to take whatever additional steps are necessary to prevent the interests of present and future pupils and students from being jeopardised.
Mr. Jack Straw rose——
Mr. Nicholas Fairbairn: On a point of order, Mr. Speaker. May I seek your guidance?
Hon. Members: Sit down.
Mr. Speaker: Order. I must apply the same rules. I shall take the hon. and learned Gentleman's point of Order after the statement.
Mr. Fairbairn: It refers to this——
Mr. Speaker: I shall take it after the statement.
Mr. Fairbairn: But, Mr. Speaker, it is a matter of importance.
Mr. Speaker: I am sure it is. I shall still take it after the statement.
Mr. Straw: The statement is a consequence of a Secretary of State who is trying to govern by gimmick, who acts first and listens only a little and much later, and who is making and changing policy on the hoof. Will the Secretary of State confirm that, last Friday at 4 o'clock, he said that schools that opted out of local authority control could not opt back, and that by midnight he had to say that they could? The Secretary of State complains of the actions of some local education authorities. Since he spoke so eloquently to the Council of Local Education Authorities about his commitment to a partnership with local education authorities, will he say whether he or his officials have have any contact with the local education authorities concerned—before the statement, not after?
Will he confirm that some authorities facing genuine difficulties over the division of colleges and polytechnic assets include some Conservative authorities such as Essex and Hampshire? Why is the Secretary of State now seeking retrospectively to control not only the disposal of land by

373
ILEA but every contract worth over £15,000? Is that not astonishing even by the Secretary of State's standards of megolmaniac centralisation? [Interruption.] Oh, yes.
Will the right hon. Gentleman confirm that that will mean that the Secretary of State will have a veto not only over individual contracts for school meal supplies, books and equipment, but over the individual appointment of any teacher of head teacher earning over £15,000 a year?
What consultation period is the Secretary of State allowing? Will it be the absurdly short period that he is allowing in respect of his other consultation documents? When will the main consultation documents on ILEA be issued? Will the statement not lead to further adminstrative chaos and uncertainty? Does it not show the need for him to withdraw today's proposals and to seek the partnership with education authorities that he says he wants?
On the matter of individual boroughs being allowed to opt out of ILEA, does the Secretary of State not recall that the report of a committee on ILEA, which he chaired, concluded that such opting out
"would leave a rump of poorer deprived boroughs and lead to an increase in administrative costs."?
If he was right then, how can he pursue this completely different policy now?
Is not this Secretary of State rapidly developing a reputation for a lethal mixture of arrogance and incompetence which is worse even than that of the Secretary of State for the Environment? While he is messing around with the education system, will he remember that he is putting children's futures at risk?
Mr. Baker: I welcome the hon. Gentleman to the shadow education portfolio and wish him well with it. He will know that we have crossed swords in the past in relation to Department of the Environment matters, and this matter touches upon such matters.
The Government would be accused of gross negligence if, by the time the Education Bill is presented to Parliament, which has been clearly signalled, polytechnics and colleges were mortgaged or leased. That would be to the detriment of students. In the papers that I have seen there is evidence that certain polytechnics — [HON. MEMBERS: "Name them."] I have talked to the directors of polytechnics, some of whom have not been prominent supporters of my party in the past, who have expressed considerable concern about arrangements that might be being made and about which they have heard. It is right for me to take such action today.
The hon. Gentleman will know how ILEA contracts operate. I intend very shortly to issue a general consent, and it will not be my intention to cover contracts of employment. I hope to be able to give general consents through a wide range. It is not my intention to try to disrupt ILEA's educational activities. We are concerned about any arrangements, contracts or action that could be taken that would carry forward a heavy obligation either upon individual London boroughs that may wish to opt out or upon polytechnics or colleges. Such charges would have to be met before charges for teaching and education. It is a prudent and necessary act.
Mr. Paddy Ashdown: The Secretary of State knows that I oppose his proposals and will continue to do so strenuously as they pass through the House.
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Nevertheless, although I can understand local education authorities and others seeking to "try it on", it is wrong that they should seek to subvert a decision of the House before it is taken. Is the Secretary of State aware, therefore, that, although I regard the £15,000 limit as far too low, if I were in his position I should have to consider taking very similar action to that which he is taking? If the hon. Member for Blackburn (Mr. Straw) were honest, I suspect that he would have to do the same.
Mr. Speaker: Order. All hon. Members are honest.
Mr. Ashdown: I withdraw that inadvertent misuse of the word, Mr. Speaker. May I use the word "frank"?
Mr. Baker: I thank the hon. Gentleman for the support that he has given to the Government's proposals today. He said that he would probably have taken similar action if he had been in my position; I thought that he had rather higher ambitions than that. As the hon. Gentleman recognised, we have declared our intentions very clearly and are bringing forward legislation, so it would be wrong if action were taken to try to thwart that. The legislation will come before the House. This is not retrospective.
I have not set an earlier date but have declared my intention as from today.
Mr. J. F. Pawsey: Is my right hon. Friend aware that any exercise in petty spite or asset stripping will be vigorously opposed not just by Members of Parliament but by students and lecturers? Is he aware that his statement will be widely welcomed and will do a great deal to protect polytechnics and to ensure that the quality of the education that they provide remains enviable in this country and elsewhere?
Mr. Baker: I thank my hon. Friend for his support. He is quite right. Members in all parts of the House should take great pride in the polytechnics. They are highly successful institutions of higher education and they have expanded dramatically. As we said in the White Paper, in many cases they are now larger than universities and the number of students—[Interruption.] Perhaps the hon. Member for Blackburn (Mr. Straw) will contain himself for a moment. I know that he has a great deal to contain. The polytechnics were established more than 21 years ago and they are highly successful. We have set out the reasons why we believe that they should become independent, freestanding institutions. That is the object of our legislation.
Mr. Harry Greenway: Will my right hon. Friend confirm that there has been a remarkable expansion in the number of polytechnic students in recent years and that he envisages a further expansion in the near future? Does he agree that it would be disgraceful and wrong if the assets available to those institutions in terms of buildings, land and facilities of every kind were diminished by the prospect of action by certain Labour authorities? Does he further agree that it is disgraceful that the Labour party in the House is supporting Labour authorities in those evil ambitions?
Mr. Baker: The action that I have taken today seeks to ensure that when those institutions become independent and free-standing they do not carry with them an unnecessarily high level of debt which could be engendered in the coming months. I agree entirely with my hon. Friend, who has great knowledge of education, that these institutions do a remarkably good job and contribute a

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tremendous amount to the level of higher education in our country. I wish to ensure that that level of quality continues.
Mr. Tom Cox: In view of the Minister's statement regarding ILEA, is he aware that what is really needed now is confidence among parent-teacher associations and among teachers themselves? Will he give an assurance that, in view of the critical decisions to be considered regarding ILEA there will be the fullest consultation with the people involved, rather than a repetition of what happened in Wandsworth in the previous attempt, when the people most directly involved were in no way consulted?
Mr. Baker: I think that I can give the hon. Gentleman that assurance. It is not my intention to interfere in the day-to-day operation of ILEA. As I have said, I intend to issue a series of consents in the next few days to ensure that the general running of ILEA continues. I wish to be assured, however, that obligations cannot be entered into which would be extremely onerous in coming years and would limit and bind individual boroughs which may wish to opt out of ILEA.
Mr. Irvine Patnick: Does my right hon. Friend's statement result from the fact that, during the abolition of metropolitan county councils, many councils not only did tombstone funding but prepared for life after death? What powers will he take unto himself to ensure that councils that try to burn the midnight oil are penalised? What action will he take against councillors who do a similar thing? What happens with legitimate sales of polytechnic assets, such as the sale at Sheffield polytechnic?
Mr. Baker: My hon. Friend speaks with considerable knowledge of those matters because he was a member of the South Yorkshire metropolitan county council at the time we brought in legislation to abolish it. He was a strong supporter of that. Since it has gone, hardly anybody has noticed that it was ever there. The same goes for the GLC. My consent will be required as from midnight tonight. If contracts are let or if assets are disposed of—in the case of polytechnics, colleges and ILEA councils —those that vote for disposals of land, and in the case of ILEA, for contracts without my consent should he aware that the sanctions available to the district auditor in respect of unlawful expenditure or loss arising from wilful misconduct may apply.
Ms. Hilary Armstrong: Will the Minister acknowledge that the continuing undermining of the relationship between polytechnics and local authorities is directly undermining and attacking the future of continuing education——
Mr. Eric Forth (Mid-Worcestershire): Rubbish.
Ms. Armstrong: —and the opening up of access to a wider group of students, which I know that the Minister has urged polytechnics to become involved in? In many areas, the funding has come directly from local authorities. I hope that he will ensure and urge that the relationship continues, so that that very important aspect of higher education is able to develop.
Mr. Baker: The hon. Lady goes a little wider than my statement. In the legislation that we are preparing on polytechnics and colleges, I want to ensure that those
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institutions retain strong local links. I agree with her that it is important that polytechnics open up wider access. I am glad to be able to tell the House that, in the past eight years, it is basically those institutes and other colleges of higher education that have increased the numbers of students by 157,000. Many people are now having access to a wider range of training than ever before.
Sir George Young: Does my right hon. Friend remember the tricks that the GLC got up to in the last Parliament? Is he aware of the widespread support on the Government side of the House for the precautionary measures that he has just announced'? Can he say what safeguards there will be for colleges such as Ealing that bid for funds and secured them from his Department but where the local authority, as an act of spite, has now decided to switch the resources away to other purposes, denying the funds for the purpose for which the local authority originally sought them and his Department gave them?
Mr. Baker: That is a very bad example of a Labour-controlled authority not acting in the best interests of higher education in its area. I absolutely deplore that.
Mr. Derek Fatchett: Whitehall knows best.
Mr. Baker: No. I deplore that and I would have thought that anybody who was concerned with improving higher education in west London would also deplore that. I well remember the various tricks that the GLC and the hon. Member for Brent, East (Mr. Livingstone) got up to. I would like to thank my hon. Friend the Member for Ealing, Acton (Sir G. Young) for the help he gave me in those days in the Department of the Environment to ensure that, at the end of the day, the assets were not stripped out of the GLC, which was a real danger. In the same way, I want to make quite sure that the assets of those polytechnics and colleges are protected.
Mr. Chris Smith: The Secretary of State is a member of a Government who came to power proclaiming that they were going to lake central Government off the backs of local government. How on earth, in morality, logic or decency, can he defend the sweeping centralisation of powers to him and to Whitehall?
Mr. Baker: Our intention is to set up polytechnics and colleges as much more independent institutions and much more in control of their own destiny than ever before. In my talks with the senior staff and the directors of polytechnics they were virtually unanimous — I think there was one against—in their support and approval of the action that we are taking. That is a measure of decentralisation.
Mr. John Marshall: Is my right hon. Friend aware that his statement will be warmly welcomed by the students and staff of Middlesex polytechnic, which has suffered from having three local author: ties on its governing body, and the inability of Haringey—one of those authorities—to pursue a sane financial policy? He will be well aware that, by the end of June this year, three months into the current financial year, the polytechnic had no budget for the current financial year. Will he give a guarantee that next year he will not allow such financial nonsenses to occur?
Mr. Baker: I am aware of the problem. The delay in the budget is largely due to a dispute over the assets and the attitude that Haringey London borough council is taking. I can assure him that I know the views of the director of Middlesex polytechnic and he strongly supports the Government's policy in this matter.
Mr. David Young: Will my right hon. Friend take on board the concern for the indecision of his Department to raise Bolton institute of higher education to the level of a polytechnic? Does he realise that, because of the dithering of his Department, great damage has been done to Bolton metropolitan borough and council, to the students and to industry in the north-west that support that institution?
Mr. Baker: The Bolton institute of higher education is a distinguished college of higher education and, together with others, it has argued for the status of polytechnic. It was made clear in the White Paper that, as soon as legislation goes through, we do not envisage a change of status of any colleges of higher education to polytechnics. Others besides Bolton have wanted that change. I can assure the hon. Gentleman that the colleges of higher education that do not have the status of polytechnics in many respects are not slighted or worse for that. The quality of the courses and the quality of higher education in Bolton is very high.
Mr. Robert Key: Does my right hon. Friend recall that, during the passage of the Education Bill 1986 those of us on the Standing Committee were the subject of heavy lobbying from polytechnic directors seeking further independence from local education authorities that were constantly interfering politically with the running of those institutions? When will my right hon. Friend give those institutions the chartered independence that so many of them seek.?
Mr. Baker: My hon. Friend is correct. That is exactly why we are bringing forward the legislation. There have been lots of comments from directors of polytechnics which, as I emphasised, have not been strong supporters of the Government in the past or of the Conservative party, who have found the control and the political interference by local authorities particularly irksome in the past few years. The legislation that we are bringing forward later this year will give the independence that was sought in 1976, requested, and we will deliver it.
Mr. Jeremy Corbyn: Does the Minister accept that his statement today concerning the ILEA will be met with consternation throughout ILEA as yet another example of the Government's continuing obsession—it is an obsession—with the destruction of unitary education throughout inner London? Does he not realise that, every time he makes a statement such as this, he increases administrative costs in his Department and in the ILEA; that his promise to break up the ILEA will result in worse education, at a higher cost, with fewer opportunities for the poorest children; and that, in the long term, all he will do is achieve a messy education system in London without the economies of scale or the benefits for the people of London that they have paid for through the building up of the ILEA over the years?
Mr. Baker: The hon. Gentleman anticipates debates that will take up the time of the House later this year. The three London boroughs that have indicated that they wish
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to withdraw from ILEA—Wandsworth, Westminster and Kensington and Chelsea—are absolutely clear that they will improve the quality of education in their boroughs when they are free from ILEA. The hon. Gentleman should not be surprised if, later this year, other London boroughs that are not Conservative-controlled also decide to opt out.
Mr. John Maples: Is my right hon. Friend aware that the vast majority of people in inner London are sick and tired of ILEA's obsession with playing politics rather than providing education and they thoroughly welcome his proposals for devolving power from it? Will he continue to do all that he can to ensure that ILEA cannot frustrate his proposals by the sort of devious subterfuge that we saw in the dying days of the GLC to which he has referred?
Mr. Baker: Yes, and many of the players in the game are much the same, apart from my hon. Friend and me, as those who were involved in the GLC. Many of the people involved in making these decisions know exactly what happened in the dying days of the GLC, and I want to ensure that decisions taken after the House has discussed them fully, and decisions taken by London local boroughs, will not be frustrated or thwarted by action which would imperil or encumber the assets, as could happen. That is why I have decided to take this action.
Mr. Tony Banks: The Secretary of State has earned himself a reputation for abandoning every previous principled position that he ever had in local government in pursuit of high office and he is a most unworthy member of the Government Front Bench.
Since the right hon. Gentleman came to the Dispatch Box and made a number of serious allegations about democratically elected local authorities, will he please name those local authorities that he understood were going to act irresponsibly? Does the right hon. Gentleman remember the paving legislation for the GLC and the administrative chaos that resulted from requiring consents to be obtained from the Department of the Environment? How many extra staff does he intend taking on in order to make sure that similar chaos is not repeated in ILEA?
Mr. Baker: I do not accept that there was chaos. The legislation was effective in protecting the GLC's assets. The hon. Gentleman only managed to get his hands on the regalia.
Mr. Banks: I would like to get my hands on your regalia.
Mr. Baker: I can assure the hon. Gentleman that he will not have my consent for that, even after midnight.
I can also assure the hon. Gentleman that the action that I have taken is necessary. Since June, ILEA has been considering what action it could take over its assets. From papers that have been drawn to my attention, there is a clear implication that Nottinghamshire county council is moving against the interests of Trent polytechnic.
Hon. Members: Just one?
Mr. Gerald Bowden: My right hon. Friend will know the warm welcome given by polytechnics to the proposals, since not only does it get the local authorities off the backs of the polytechnics but it ensures that they retain their assets before they achieve independence. But

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can my right hon. Friend assure us that those polytechnics —I instance those in London—that are reforming their courses and changing their structure in the interests of efficiency and better performance, and have in train, and wish to take, steps which may involve negotiations, disposals of buildings or the reorganisation of buildings, which are perfectly proper transactions, will not be impeded?
Mr. Baker: Yes, it will not be my intention to cover such transactions. I want to make it clear that I want to ensure that there is an orderly control of assets. There will, of course, be changes of organisation over the next year or 18 months. However, the polytechnics in central London have a rather more distant relationship with ILEA. They are separate corporations. But, once again, if one talks to the directors of those polytechnics one realises why I have had to take this action.
Mr. Bob Cryer: Is the Secretary of State seriously proposing that this draconian action based on legislation yet to come before the House is the result of his understanding from one or two polytechnics? The right hon. Gentleman has not given the House any further information. It is outrageous for him to talk about it not being retrospective legislation because if he is depending on future legislation before the House for his action today, starting at midnight, it must follow that the legislation to support his action will be retrospective. I thought that the Conservative Benches were against retrospective legislation. Is that sort of incursion and trampling of parliamentary powerss what the former Lord Chancellor meant by an elective dictatorship?
Mr. Baker: It is not retrospective. It would have been retrospective if I had said that it operated from a week, a fortnight or a month ago. I have declared my intention as from midnight tonight and I shall be taking powers to implement it. I can assure the hon. Gentleman that directors of several polytechnics have seen me in the course of the past few weeks—[HON. MEMBERS: "Which ones?"] — and have expressed great concern about possible changes in assets.
Dr. Ian Twinn: Is my right hon. Friend aware that all those who have a genuine interest in caring for polytechnics will be disturbed to hear the news that he has brought to the House today of the irresponsible activities of local authorities?
Mr. Tony Banks: Which ones?
Dr. Twinn: Can my right hon. Friend confirm that this is not a vindictive action against local authorities but one which stems from the Government's genuine concern for students because the polytechnics exist in the interests of the students, not the local authorities, or, indeed, the staff, of which I count myself one.
Mr. Baker: My hon. Friend is right. He knows a great deal about polytechnics, having been a lecturer at one. I can assure him that what he has said is right. My interest is to ensure that these institutions, which are very good indeed, are not jeopardised by any action that may be taken.
Mr. Jim Cousins: Does the right hon. Gentleman recognise that many polytechnics are engaged in the economic and social development of their regions, amongy which my polytechnic in
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Newcastle is a prominent example, and. indeed, is receiving additional resources from the local authority and various Departments of State to support activities such as the fashion centre, the small business centre, the regional technology centre and the development of industrial and technological activities arising out of the work of the polytechnic staff? Therefore, will he name those local authorities that he suspects of acting improperly with regard to the prospect of future legislation, and exempt all the other institutions that he does not suspect from all the restraints, inconvenience and red tape that will flow from his decision?
Mr. Baker: I have visited Newcastle polytechnic twice and I agree that it is a good polytechnic. An authority which has no intention to encumber or dispose of the assets of a polytechnic need have nothing to fear from the consent powers that I am requiring from tomorrow.
Mr. Michael Stern: Does my right hon. Friend agree that declaratory legislation of this type is never popular but that the entire polytechnic world will welcome the action that he has announced today in order to protect the future of education in polytechnics? In the light of the cries from Opposition Members to name names, while he cannot name the authorities which might take action in future — [HON. MEMBERS: "Why not?"] because he is not a prophet—is he prepared——
Mr. Cryer: Why can he not name them? He has had all the directors in.
Mr. Stern: Does my hon. Friend agree that there would be a startling correlation between the authorities that he is most worried about and those under Labour control?
Mr. Baker: The directors of the polytechnics and some of the heads of colleges have made it clear to me that they are very anxious indeed about what might happen to assets which have been currently used for their students in their education and general recreation, so it is important that these powers are taken.
Mr. Robert G. Hughes: Is my right hon. Friend aware that the staff and students of Harrow college of technology have expressed to me some concern about his proposals, but their concern is that they may not be included in his proposals? Can he give me and them any assurance today that they will be included and have the benefits of what he is proposing for the polytechnics today?
Mr. Baker: I do not believe that Harrow college is one of those included in the list that I have given today, but if my hon. Friend is anxious and if education is being placed at risk by any activities, I shall be interested to hear.
Mr. Chris Mullin: Will the Secretary of State please name the directors of polytechnics who have come to him to express such concern?
Mr. Baker: I certainly will not, but I can assure the hon. Gentleman that they have not only seen me individually but collectively when I visited their conference earlier this year.
Mr. Kenneth Hind: Does my right hon. Friend accept that the students and staff at Edgehill college of higher education at Ormskirk, and at Lancashire polytechnic will welcome the action that he has taken to

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protect them in these circumstances? Does he agree that what he has announced exposes the fact that many of the interests of institutes of higher education, polytechnics and local education authorities do not coincide and that the measure that he has announced today will be seen in many quarters as a preventive measure in the light of many of the activities of Labour local authorities throughout the country, particularly with regard to the abolition of the metropolitan county councils?
Mr. Baker: The action that I have taken today will ensure that when Edgehill college of higher education becomes a separate standing institution it will not carry with it an enormous incubus of debt which could be raised very quickly. That incubus of debt would have to be met before the educational requirements of the students and pupils of that college.
Mr. Michael Fallon: Does my right hon. Friend agree that the irresponsible behaviour of some of those local authorities — [HON. MEMBERS: "Which ones?"] justifies not simply the action that he is taking today but the proposals that he will bring forward to protect the students and customers of the polytechnics from this appalling politicking in future? When are the new proposals likely to be brought before the House?
Mr. Baker: The Education Bill will come forward later this year. One of the advantages of the proposals is that the polytechnics and colleges of higher education, many of which have been subject to political bearing down over the past few years, will become independent institutions. I am sure that that will be a tremendous advantage. They are doing a very good job and they should concentrate on education and not be involved with party or local politicking.

Scottish Business
4.21 pm
Mr. Speaker: I shall now take points of order.
Several Hon. Members rose——
Mr. Speaker: Order. I shall take points of order arising out of the statement first, for neatness.
Mr. Nicholas Fairbairn: You will recall, Mr. Speaker, that you granted a request which resulted in a Division which delayed the statement and the questions that we have just heard. That request was made to you by the hon. Member for Falkirk. West (Mr. Canavan) presumably on the basis that those who represented parts of the United Kingdom were not entitled to be present at or take part in Scottish Questions. As the hon. Member for Falkirk, West sat throughout a statement which does not have and could not have anything whatever to do with Scotland, will you consider taking powers to forbid or punish such perverse humbuggery?
Mr. Speaker: That is not within my power. I shall take points of order relating to Scotland.
Mr. Dick Douglas: May I first apologise, Mr. Speaker, for some remarks that I made from a sedentary position which might have reflected on your tenacity in terms of ruling, when the hon. and learned Member for Perth and Kinross (Mr. Fairbairn) was on his feet.
May I ask you, Mr. Speaker, to use the recess, if you cannot do this immediately, to reflect on what is happening in the House with regard to some of your rulings—in particular the ruling that you insist upon now, that you do not take points of order until after questions? You will acknowledge that if there are questions, a business statement and then another statement, many of us who want to hear your words of wisdom and the information and guidance that you want to give us in terms of order might be denied those words of wisdom for some hours. That would be very unfair if there were business statements and other statements—as there are on some days—when on other days there are no statements and points of order are reached at 3.30 pm or so.
When you came to assume the Chair. Mr. Speaker, in this Session of Parliament, you reflected on transmitting the behaviour of the House through the medium of radio and perhaps later television. You should be aware, Mr. Speaker, that Scottish Question Time is broadcast in Scotland.
Mr. Speaker indicated assent.
Mr. Douglas: If you are aware of that, I am grateful. [HON. MEMBERS: "Live."] Yes, it is broadcast live; I am indebted to my hon. Friends for reminding me of that.
Therefore, many of us who genuinely want to ask questions table them and they appear on the Order Paper. Because of the imbalance that the electorate in Scotland has inflicted on the Government — I make no apology for that and indeed welcome it—you find yourself in the position, Mr. Speaker, of frequently having to call Conservative Members who may or may not have tabled questions.
While we recognise that you have a duty to adhere to the conventions of the House with regard to minority

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parties and a duty to ensure that individual rights are protected, I ask you to reflect, Mr. Speaker, in the recess and make a statement when the House resumes, about the position that occurs when many of us, especially during Scottish Question Time—although it might happen on other occasions — are prohibited from putting our questions and protecting the interests of our constituents because you must call Conservative Members. Indeed, we only reached question 10 or 11 today. I hope that you will reflect on that, Mr. Speaker, and I ask you respectfully to consider it over a period.
Mr. Dennis Canavan: Further to that point of order. Mr. Speaker.
Mr. Speaker: Order. I want to deal with one or two points. First, I thank the hon. Member for Dunfermline, West (Mr. Douglas) for his remarks at the beginning of his point of order. I also apologise to the hon. Gentleman for some unscripted remarks of the Chair.
May I just say, a propos Scottish questions, that I am aware that they are broadcast. I took that into account throughout the previous Parliament, and I therefore try to discover what matters are of major interest to Scotland and give a rather long run to those questions. If Scottish Members do not like that method, I shall certainly reflect to see whether we should take questions more rapidly. It would, of course, have the effect of my calling more hon. Members who may have early questions on the Order Paper. However, I point out to the hon. Member for Dunfermline, West and to the House that no fewer than 20 Back Benchers from Scottish constituencies were called on supplementary questions today who had later questions on the Order Paper. I link them in my mind, although they may not be linked by the Minister replying. I will certainly reflect on this matter.
With regard to the points of order arising immediately after questions, we have had a number of exchanges on that matter. The trouble about taking points of order immediately after questions is that they invite an extension of Question Time. As I said to the House the other day, I have undertaken a very careful analysis of the matter and I have found that invariably those who rose on points of order were seeking to extend Question Time, usually to complain that, sadly, they had not been called during that Question Time. I believe that the whole House will agree with me that if points of order are genuine, hon. Members will wait for a little later in the afternoon.
Sir Hector Monro: Is not the real trouble that the much heralded and vaunted attack by the Labour party on the Government on Monday night and today has completely failed, and that Opposition Members are trying to take it out on you, Mr. Speaker, rather than on themselves?
Mr. Canavan: Further to the point of order. It was with considerable reluctance that I caused inconvenience to the House earlier by spying Strangers. Perhaps if you took the point, Mr. Speaker, made by my hon. Friend the Member for Dunfermline, West (Mr. Douglas), that genuine points of order arising from questions should be taken immediately after Question Time, there would be less inconvenience caused to the House.
The point of order that I would have raised immediately after Question Time is that I made the point earlier, just before your re-election as Speaker, that the
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Labour party is the majority party in Scotland and as such is entitled to a fair share of Scottish Question Time. I submit that we did not receive our fair proportional allocation of time this afternoon, for the simple reason that Scottish Question Time was infiltrated by Tory Members representing English constituencies, who normally show little if any interest in Scottish affairs. They deliberately came in to the Chamber this afternoon to disrupt Question Time and to try to minimise the democratic expression of the elected representatives of the people of Scotland.
When several of my hon. Friends objected to that, Mr. Speaker, you said in reply words to the effect that you are entitled to call English Members at Scottish Question Time because Scottish Members are called at English Question Time. There is no such thing as English Question Time and to my knowledge there never has been. Every Department of State in the Government has some influence on Scottish affairs. Therefore, Scottish Members are perfectly entitled to come in on questions to the Department of the Environment, the Treasury, the Ministry of Defence, the Department of Education and Science and so on. I submit, Mr. Speaker, that for you to say that there is such a thing as English Question Time was perhaps a slip of the tongue. Perhaps the House is entitled to an explanation and at Scottish Question Time Scottish Members should have a fairer share in future.
Several hon. Members: On a point of order.
Mr. Speaker: One at a time, please.
Of course, that was a slip of the tongue. I meant to say that this is a United Kingdom Parliament and that all hon. Members have equal rights. As the hon. Gentleman said, it is perfectly legitimate for Scottish or Welsh Members to take part in Question Time to other Departments. The hon. Gentleman has only to look at Hansard tomorrow to see the weight that I gave to Scottish Members at Question Time today compared to the weight that I gave to hon. Members who sit for English constituencies, to know that what he said is not correct.
Mr. Bill Walker: Further to the point of order, Mr. Speaker. It will be within your recollection that during questions to many Departments there are in the House many Members whom I would describe as fairly regular attenders. You will know just who they are. You will also realise that, if they are on the Conservative Benches and asking questions about matters affecting United Kingdom Departments or Departments whose remit is often exclusively English, then, because there are so many of them, they have less chance of getting in. Labour Members during Scottish Question Time find themselves in exactly the same situation. That only occurs in their case on Scottish questions. Those of us who regularly attend find ourselves disadvantaged in that way at almost every Question Time. I have no complaint whatever, Mr. Speaker, about whose eye you catch and whom you call. In very difficult circumstances, you do an extremely fine job.
Several hon. Members: On a point of order.
Mr. Speaker: I shall take all the points of order and then reply.
Mr. Michael J. Martin: It is my understanding that Scottish Question Time is an opportunity for Scottish Back Benchers to highlight

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matters that affect Scotland. Of course, English and Welsh Back Benchers are welcome to put down questions. I have noticed before and during Question Time today that several Scottish Conservative Back Benchers were called on several occasions.
Mr. Eric Forth (Mid-Worcestershire): So what?
Mr. Martin: The hon. Gentleman says, "So what?" There are 50 Labour Members in the House representing Scottish seats and there are Members from other parties. We are expected to put up a case for our communities, but we cannot do that if we get only one opportunity at Scottish Question Time, while Tory Back Benchers from Scotland are able to come in two or three times. That is unfair. It causes resentment, and I wonder whether there is some way of ensuring a proper balance in calling Members.
Mr. Forth: Further to the point of order. Can you confirm, Mr. Speaker, that you do indeed preside over a United Kingdom Parliament and that Question Time for different Departments for different parts of the United Kingdom is equally open to all hon. Members? Can you also confirm that a large amount of money from the national Exchequer goes north of the border to Scotland, and that those of us who represent English taxpayers are fully entitled to question the expenditure of that money? Would you further confirm that you would welcome participation in Scottish questions as in all other departmental questions by Members from all parts of the United Kingdom? It would be totally invidious if you were to take part in any distinction or discrimination between Members from Scotland, Wales or England on any aspect of Government policies. As you well know, Mr. Speaker, we all wish to question the Government on their policies and expenditure in every part of the United Kingdom.
Mrs. Margaret Ewing: Further to the point of order, Mr. Speaker. Knowing of your own determination to see that a balance is achieved and that Back Benchers are protected, could we remind the hon. Member for Mid-Worcestershire (Mr. Forth) that Scottish Question Time is broadcast live in Scotland? It is not broadcast to the whole of the United Kingom.
Mr. Forth: It should be.
Mrs. Ewing: Therefore, it is important that the people in Scotland who are listening to our deliberations in the House should feel that the views of the people of Scotland are adequately reflected. Because of the nature of the procedures of the House, it appears that 50 per cent. of today's broadcasting time was given to a party that held on to only 10 seats in Scotland. Many Back Benchers in the Opposition parties commanded the respect of a large number of Scottish people and were not able to participate.
Several hon. Members rose——
Mr. Speaker: I said that I would hear all the points of order before replying, but I must deal with this immediately. The hon. Lady is being unfair. She should look at tomorrow's Hansard and then perhaps write me a letter about this, because she will find that 31 Members with Scottish constituencies were called. There were two questions on the Order Paper from Members with English
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constituencies and three other Members from English constituencies were called. I do not think that that is an unfair balance in Scottish terms.
Mrs. Ewing: Mr. Speaker——
Mr. Speaker: Mr. Key.
Mr. Robert Key: Further to that point of order, Mr. Speaker. May I urge you not to reflect too strongly on this matter in the summer, but to retain your traditional impartiality? I had question 34 on today's Order Paper. My constituency has forestry interests that are very important. By tradition of the House, I have to address those questions about matters in my constituency to the Secretary of State for Scotland. Would not the answer be not to blame the Chair, but to encourage the Boundary Commission to do its work properly and to reduce the number of very small Scottish Labour constituencies?
Mr. Harry Ewing: On a point of order, Mr. Speaker. One of the problems with not taking points of order at the end of Question Time is that, whereas my point of order arises directly from an answer given to a question, the wrong Minister has stayed on; we are left with the most inoffensive, innocuous Scottish Office Minister that we have ever had. He would not harm a fly. The Secretary of State knows that, so he leaves him behind and the real culprits escape from the House. I have to apologise to the Under-Secretary of State, the hon. Member for Stirling (Mr. Forsyth), about whom I complain in this point of order. No doubt his parliamentary colleague will carry the message to him.
In answer to a supplementary on question 7 about appointments to health boards in Scotland, the Under-Secretary of State said—I paraphrase—that, although it was right that the Secretary of State made these appointments, he was not aware of the politics of the people that he appointed to these boards. I have in my possession four nomination papers from last year's round of appointments to the Forth valley health board. [HON. MEMBERS: "What has this to do with it?"] It is a very good point of order. All these nominations were signed by the Leader of the House, then the Government Chief Whip; all these nominees are members of the constituency Conservative party of the hon. Member for Stirling and they all live in his constituency. He has misled the House.
Mr. Speaker: The hon. Gentleman has put his finger on exactly what happens if we take points of order immediately after Question Time. They become an extension of Question Time. The fact that the hon. Gentleman did not like the answer that he received is no reason for him to raise a point of order through the Chair. If he does not like an answer, he should rise immediately on a point of order and say that he will seek to raise the matter on the Adjournment. That is the correct method of dealing with unsatisfactory answers.
Mr. Michael Fallon: Further to the original point of order, Mr. Speaker. Are you aware that I had question 16 on today's Order Paper? Although I rose during earlier questions and regularly attend during Scottish Question Time, being born and bred in Scotland, unlike Opposition Members, I make no complaint about not being called, because Question Time has to be seen as a whole and, in the fulness of time, these things probably even out.
Mr. John McAllion: Further to that point of order, Mr. Speaker. Do you agree that Scottish Office Ministers wield considerable powers over the people of Scotland, and that one of the prime functions of Scottish Question Time is to allow the elected representatives of the people of Scotland to hold those Ministers to account? On several occasions during Question Time, when I sought to catch your eye, Mr. Speaker, I was unable to do so because hon. Members representing English seats, whose constituents have no interest in Scottish Office business, continued to catch your eye to exclude Members like me from putting questions.
Mr. Gerald Howarth: Further to that point of order, Mr. Speaker. During questions on Scottish affairs, the hon. Member for Glasgow, Hillhead (Mr. Galloway), who I understand is a new Member of the House, referred to those of us who represent seats in England as "pressed men" attending Scottish Question Time. I am sure that that is an unparliamentary expression. I am proud to be a Member of this Parliament, which represents the United Kingdom. I am also proud as a Douglas, having close family links with Scotland, to speak alongside my excellent hon. Friends from Scotland for the 713,000 people in Scotland who voted Conservative.
Mr. John Home Robertson: Further to that point of order, Mr. Speaker. I recognise that an important and significant part of your duty is to protect the rights of minorities in the House. However, I put it to you that perhaps you erred on the side of generosity in going to the lengths that you did today to protect the saddest minority in the House, the Scottish Conservative party, which was utterly gutted in Scotland at the last election and which has only 10 hon. Members in the House. Is it really appropriate to try to protect that tiny minority from Scotland by calling a procession of obscure expatriates from Worcestershire, or goodness knows where else, to make up their numbers? May I invite you, Mr. Speaker, to reflect on that practice?
Mr. Kenneth Hind: Further to that point of order, Mr. Speaker. I urge you to resist the temptation and the pressure that is clearly being put on you by Opposition Members to extend Question Time beyond 3.30. Conservative Members fully support the stance that you have taken not to extend Question Time in that way and I urge you to pursue that. On the protection of minorities—we all appreciate that that is important — if you were to apply criteria on numbers, for every three Conservative Members that you call, you would call only two Labour Members. Clearly you do not do that for any other business and I urge you to continue with the rule that you follow at the moment.
Mrs. Maria Fyfe: Further to that point of order, Mr. Speaker. I have just been reading question 34, which was tabled by the hon. Member for Salisbury (Mr. Key). Do you agree that that question is a blatant attempt to waste time in Scottish Question Time because such a question could easily be put in for a written answer——
Mr. Speaker: Order. I must stop the hon. Lady. If the Table Office accepts the question, it is perfectly in order.
Mr. Donald Dewar: Further to that point of order, Mr. Speaker. I know you have given a great deal of thought to the serious point that was raised in a dignified and helpful way by my hon. Friend he Member for Dunfermline, West (Mr. Douglas) about I he order of business in the House. I recognise that this is riot specifically a Scottish problem. It arises right across I he range of business in the House. As my hon. Friend the Member for Falkirk, West (Mr. Canavan) said, we now have with us the hon. Member for Edinburgh, West (Lord James Douglas-Hamilton), who is certainly not the right hon. and learned Member for Edinburgh, Pentlands (Mr. Rifkind). If there had been continuity from Question Time, we might not have had that disadvantage. I should have preferred the Secretary of State to be here for these exchanges.
On the substantial point, it is clear that there is always a good deal of political fencing around such matters. I accept that that will always be the case and that we shall make our contribution to it. However, at the moment we face a substantial and genuine problem. I must record through you, Mr. Speaker—perhaps it will be noted by the usual channels—that there was not a pleasant atmosphere this afternoon——
Mr. Forth: Rubbish.
Mr. Dewar: Well, that was my view. I put this point seriously and, I hope, in a reasonably constructive fashion. There was a fair degree of smirking and something of a self-satisfied atmosphere on the Conservative Benches. Indeed, it was the atmosphere of a Sunday school outing —or the parliamentary equivalent of it. Outside in the Lobby, I happened to hear the comment, "This has been a splendid operation." [HON. MEMBERS: "Hear, hear."] It is quite clear that the Whips have been hard at work.
That atmosphere raises serious probems which will exacerbate the genuine difficulty that we face in getting the right balance in the difficult political situation that exists in Scotland. I hope that you will not resent this, Mr. Speaker, but I believe that that makes your job much more difficult. I hope that Conservative Members, who axe especially loud in their cries about the importance of and their devotion to the principle of making this a United Kingdom Parliament which works, will consider whether the tactics that we have been watching are not likely to be totally counter-productive in terms of the alleged principles of those Conservative Members. I hope that they will think about that.
Finally, I recognise that this situation throws up sharp and difficult problems for you, Mr. Speaker. We must think carefully about the right balance of contributions in Scottish questions, given the present situation. I hope that you will consider seriously the comment made by my hon. Friend the Member for Dunfermline, West and reflect on them. Perhaps we could return to this matter in a calmer atmosphere in October.
Mr. Speaker: I thank the hon. Gentleman. I shall, of course, reflect on points of order, as I always do. Perhaps the whole House will reflect too on the wise words of the Leader of the Opposition when he said at the beginning of this Parliament that, sadly, no hon. Member can expect to be called always on the day he wants, on the subject lie wants and at the time he wants.

State Security
4.46 pm
Mr. Tam Dalyell: On an entirely different point of order, Mr. Speaker. May I raise at the first opportunity a matter relating to proceedings in Parliament ? I tabled a written question to the Prime Minister today to ask
"if she will introduce legislation to amend the Official Secrets Act so as to provide that civil servants who provide information to Mr. Speaker are not open to prosecution in the courts".
I raise this because it concerns the office of Speaker. The reply was that there were no plans to do so at the present time.
In the light of several events, not least the events arising out of the trial of Clive Ponting, and of other difficulties relating to civil servants, may I put it to you, Mr. Speaker, that during the recess you at least consider whether those who go to you in your official capacity as Speaker of the House of Commons and to the Clerk's Department should in some way be protected from actions in the courts? There is nowhere else for those people to go, other than to the press, and that would be most unsatisfactory. If I had gone to the press in the Ponting case, the verdict might have been different. May I ask you, Mr. Speaker, to consider those weighty matters during the recess and to reflect on the way in which proceedings in Parliament should operate?
Mr. Speaker: The hon. Gentleman has raised a matter which is new to me. I shall certainly reflect carefully on it.

Statutory Instruments (Consideration)
4.48 pm
Mr. Bob Cryer: On a point of order, Mr. Speaker. The eighth item on the Order Paper relates to the draft European Communities (Definition of Treaties) (International Convention on the Harmonized Commodity Description and Coding System) Order 1987 and will be taken forthwith, pursuant to Standing Order No. 101(5). It was considered yesterday in a merits Committee at 10.30 am —merits Committees are open to all hon. Members — and the Joint Committee on Statutory Instruments was due to meet at 4.15 pm. Therefore, the merits Committee meeting could not have the report of the Joint Committee. Moreover, the Joint Committee could have decided to take further evidence on the submission from the Foreign and Commonwealth Office. The Committee decided that the matter should be referred to the House of Commons and a report made pointing out that the instrument appeared to make an unexpected use of powers.
Because the matter is to be decided forthwith, perfectly properly, the matter cannot be discussed. The merits Committee could not possibly have the decision of the Joint Committee because the latter had not considered the matter and was to do so later the same day. Since both Joint and Select Committees are obliged under Standing Order No. 115 to report matters to the House for the House to make a judgment, will you, Mr. Speaker, bring to the attention of all the parties concerned the fact that, if a Select Committee is to be useful, every effort should be made by the usual channels, with your help and guidance, to ensure that Joint and Select Committees on statutory instruments have the opportunity to consider an instrument before a merits Committee, so that when we decide forthwith it is because every aspect has been considered in Committee?
Mr. Speaker: That is an important matter. The hon. Gentleman's remarks will have been heard by the Patronage Secretary who is in his place. If the motion is put tonight, it is open to the hon. Gentleman to vote against it. However, I am sure that what he has said will be noted by the Patronage Secretary.

BILL PRESENTED
  SCOTTISH DEVELOPMENT AGENCY
  Mr. Secretary Rifkind, supported by Mr. John Major, Mr. Ian Lang, Lord James Douglas-Hamilton and Mr. Michael Forsyth, presented (under Standing Order No. 48 (Procedure upon bills whose main purpose is to create a charge upon the public revenue)) a Bill to make provision with respect to the limit on sums borrowed by, or paid by the Secretary of State to, the Scottish Development Agency and its subsidiaries, on sums paid by the Treasury in pursuance of guarantee of loans to the Agency and on loans guaranteed by the Agency or its subsidiaries: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 140].

  STATUTORY INSTRUMENTS &c.
  Ordered,
  That the draft Welfare of Calves Regulations 1987 be referred to a Standing Committee on Statutory Instruments, &c.—[Lord James Douglas-Hamilton.]

  Social Security
  4.51 pm
  The Parliamentary Under-Secretary of State for Health and Social Security (Mr. Michael Portillo): I beg to move,
  That the draft Pensioners' Lump Sum Payments Order 1987, which was laid before this House on 7 July, be approved.
  I understand that it will be for the convenience of the House if we discuss at the same time the following motion:
  That the draft Supplementary Benefits (Requirements and Resources) Amendment Regulations 1987, which were laid before this House on 9 July 1987, be approved.
  In passing, I wish to congratulate the hon. Member for Derby, South (Mrs. Beckett) on retaining her portfolio and to wish her well in her renewed stint as her party's social security spokesman.
  The order provides for the payment of the £10 Christmas bonus. The regulations put into effect the amendments to the supplementary benefit regulations dealing with the payment of benefit to people in residential care and nursing homes which were announced on 7 July in a reply to my hon. Friend the Member for Crawley (Mr. Soames). They also uprate for the purpose of assessing the amount of benefit payable the element in the student grant that can be disregarded because it is intended for books and equipment.
  I shall deal first with the changes to the supplementary benefit regulations relating to the payment of benefit to people in small residential care homes. As the House will know, people living in private or voluntary residential care homes registered with a local authority under the Registered Homes Act 1984 can get supplementary benefit to help with the fees that they have to pay. The amounts payable are subject to national limits ranging from £130 to £190 depending on the category of care provided by the home. Small homes with three or fewer residents cannot register with a local authority. Nevertheless, people living in these homes can get supplementary benefit up to the same limits as registered homes.
  The intention was that this should happen only where the care given was clearly equivalent to that given in a registered home. However, there is doubt whether the current regulations actually achieve this aim. Recent legal advice is that if any amount of personal care is provided, help with the fees can be given up to the registered home limit even if the home has inadequate facilities and provides a low level of care. That would clearly be unsatisfactory. There has also been widespread concern that the present benefit provisions positively encourage the setting up of small homes, regardless of the services provided.
  The amendments provide a tighter definition of a small residential care home in line with the previous policy intention. As the House will know, there are different ranges of limits for various types of board-and-lodging accommodation: ordinary board and lodging and hostels where the limits range from £45 to £70, residential care homes with limits from £130 to £190, and nursing homes with limits from £175 to £230. Our intention was that the residential care home limits would apply for residents of small homes only where the level of provision and thus the cost of the home would justify those benefit levels. The new definition at regulation 2(b) takes the provision of staff of reasonable calibre as the proxy for additional costs. The residential care limit will apply where the home
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  provides personal care and there are at least two people with relevant experience employed in providing that care. At least one of those people must be available throughout the working day and one must be on call throughout the night to care for residents. Residents must have full access to the home at all times.
  The new definition will ensure that rates of benefit bear a defensible relationship with costs. The present arrangements require adjudication officers to make a judgment on whether the standard of care given in a small home is equivalent to that in registered homes before allowing the residential care home limit. The new definition specifies the requirements for the higher limit and should thus be easier to administer and will provide a system which is clearer for adjudication officers, claimants and those providing care.
  The House will be concerned about the transitional arrangements. A few claimants in small homes may already be receiving higher rates of benefit, although the level of care would not justify the higher rates under the new provisions. In order to protect the position of those residents, regulation 3 provides that where an adjudication officer has already decided under the current rules that a residential care home limit is appropriate, claimants who continue to live at the same address will continue to qualify for the higher benefit limits.
  Before leaving the subject of residential care, I should mention that the amendment regulations also include, at regulation 2(a), a new definition of a "nursing home". This is a technical amendment to make it clear that references to nursing homes in the supplementary benefit requirements regulations are to registered homes, so as to ensure that no payment is made in respect of homes which are not registered, unless the home is specifically exempted from the need to register.
  The amendment regulations also deal with a wholly different aspect of supplementary benefit. Regulation 4 reflects the increased rates of student grants for the academic year 1987–88. Within the new rates of grant there is an increased allocation for books and equipment. The supplementary benefit regulations provide a specific disregard for this element of the student grant, and the purpose of this regulation is to uprate that disregard to the new level.
  I should explain that this applies to a small category of students. Most students cannot claim benefit during the grant-aided period, since they are on their course and not available for work. However, lone parents and disabled people who are not required to be available for work can claim benefit while studying and their grant is taken into account as a resource against their benefit requirements. The grant is high enough to take most of these students out of benefit, but a few have needs sufficient to qualify them for benefit to top up the grant.
  If a claimant has a partner who is a student, the couple's total needs are calculated, any grant is taken into account, and benefit will be payable during the grant-aided period. For these students, and for lone parents and disabled students, it is important that we do not treat their grant for books as a resource, and the disregard ensures that we do not take account of it. Only a small number of students are affected, but for them the uprating of the disregard is wholly advantageous.
  The draft order provides for the payment of a non-taxable Christmas bonus of £10 in the week commencing

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  7 December to retirement pensioners and to recipients of the other qualifying benefits specified in the Pensioners' Payments and Social Security Act 1979.
  It may seem curious to the House that, in mid summer, we have to debate the Christmas bonus, some six months in advance. I am pleased to be able to remind the House that this is the last time that such a debate will be necessary. From next year payment of the bonus will be made automatically as one of the very welcome administrative simplifications resulting from the Social Security Act 1986.
  Mr. Paul Marland: As this is the last time that we shall debate the Christmas bonus, may I tell my hon. Friend that there is a pensioners' organisation in my constituency which would much rather have an increase in the basic pension than a number of what they see as fringe benefits added to the pension? Does my hon. Friend have a view on that?
  Mr. Portillo: I am grateful to my hon. Friend for his comments. I have heard that opinion expressed before and I understand what brings it about. Those fringe benefits, as he describes them, are of substantial help to the poorest groups in our society. If we took the route that my hon. Friend and his constituents are proposing, the money would be spread thinly across the total number of pensioners, of whom there are almost 10 million today. I appreciate the point made by my hon. Friend, and I hope that he understands my point.
  The order and the purpose of the bonus need little introduction. The annual bonus, payable at first on a discretionary basis, was introduced in 1972, and was made a statutory entitlement by the Conservative Government in 1979. Unlike the last Labour Administration, which failed to pay the bonus at all in two years, we believe that pensioners budgeting for Christmas need the assurance of that contribution to their expenses which this payment provides. This year the bonus will be paid to a record number of pensioners and beneficiaries, at an estimated cost of about £114 million.
  Mr. Robert McCrindle: My hon. Friend said that this was the last occasion on which we would have to discuss this matter because of the reference to it in the Social Security Act 1986. What opportunities will there be for hon. Members to suggest that the level at which the bonus is paid — its permanence is welcome—may continue to be a suitable subject to which they may turn their attention?
  Mr. Portillo: As a relative newcomer to the House compared to my hon. Friend, I hesitate to advise him on when he should raise that issue. I am sure that he will use his ingenuity and raise it on numerous occasions. We certainly look forward to that.
  It might be helpful if I set the Christmas bonus in context by considering its relative importance within the whole system of financial help for elderly people. It may also serve as an answer to my hon. Friend the Member for Brentwood and Ongar (Mr. McCrindle). With total benefit expenditure running at over £46 billion in this financial year, it is essential that we channel resources in the most effective way to those in need. Spending on benefits for elderly people accounts for about £22 billion,
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  almost half of that total, and the overwhelming majority of that expenditure goes, of course, on the day-to-day support which pensioners need throughout the year, not just at Christmas. I feel sure that there is widespread agreement that we should concentrate our resources on regularly paid benefits.
  Indeed, I noted with interest from the election manifesto of the Labour party that that is the course that it would have followed had it been elected to office. There is no mention there of an increase in the Christmas bonus. We recognise that, however welcome one-off payments such as the Christmas bonus may be to pensioners and to others who receive them, they are essentially only a minor part of the total structure of help for elderly people. Our record shows that we have been meeting the challenge and putting our efforts into providing what pensioners need and want, a decent standard of living for 365 days of the year. We have maintained benefit levels, despite paying pensions to a million new pensioners since 1978, and indeed we have increased spending on benefits for the elderly by 29 per cent. in real terms since 1978–79. More than that, by controlling inflation we have protected that part of pensioners' incomes that does not come from the state.
  Pensioners' incomes grew on average by 2·7 per cent. a year in real terms between 1979 and 1985, a rate of increase that was more than twice that for the population as a whole. That compares with an average increase in pensioners' incomes in real terms between 1974 and 1979 of only 0·6 per cent. a year. Income from state pensions and means-tested benefits increased at much the same rate between 1974 and 1979 and between 1979 and 1985. Those benefits account for about 60 per cent. of pensioners' incomes on average, but lower inflation between 1979 and 1985, and the steady development of occupational pensions, had a dramatic impact in the second period on total income.
  Income from savings, which is received by 70 per cent. of all pensioners and 83 per cent. of recent pensioners, decreased in real terms by 3·4 per cent. a year between 1974 and 1979, whereas from 1979 it has increased by 7·3 per cent. a year.
  Occupational pensions are now received by over half of all pensioners, compared with only 40 per cent. in 1979, and about 70 per cent. of recently retired couples have them. For those with occupational pensions, the value is on average roughly the same as the state basic pension. Over 5 million people now receive occupational pensions.
  If total income is taken into account, pensioners' incomes, on average, are 60 per cent. of those of people in work. Far fewer pensioners are now on very low incomes. The number of those in the lowest fifth of the national income distribution fell from 38 per cent. in 1979 to 25 per cent. in 1985. Even after account is taken of housing costs, which have risen in real terms, there has still been a rise in average real net incomes for the elderly. Net of housing costs, they rose by nearly 2·5 per cent. a year between 1979 and 1985, compared with only 0·4 per cent. a year between 1974 and 1979.
  Against that background, the Christmas bonus is necessarily only a very small part of the financial picture for pensioners. None the less, the bonus is something to which the majority of the elderly look forward very much, and I therefore have no hesitation in commending the order to the House.
  5.7 pm
  Mrs. Margaret Beckett: It is my pleasant task not only to welcome the Under-Secretary of State to his new responsibilities—which I do with particular pleasure, because he follows a path that I, too, was fortunate enough to follow, from the Government Whips' Office to departmental Front Bench—but to welcome you, Madam Deputy Speaker, to our social security debates. I know your excellent reputation as Chair of many Committees, and I am sure that we shall be very happy to have you presiding over our debates. Whether you will always be equally happy with the exciting nature of those debates is another matter.
  I shall attempt to follow the pattern of the Under-Secretary's contribution, and deal briefly, first, with the issue of disregard for students in the requirement regulations. Like the hon. Gentleman, we believe that it is a necessary change, and we welcome the increase that the Government are making. As this is the first occasion on which the hon. Gentleman has presided over a social security debate in his present capacity, and we are being charitable to him, I shall mention only in passing that I seem to recall that the National Union of Students' evidence to the Select Commitee on Education, Science and Arts suggested that the element being dealt with in this disregard has gone up in cost by 65 per cent. since 1968, while the increase offered is about 12 per cent. However, I am sure that it will be more than welcome, and we do not propose to contest it on those grounds.
  We can also see the reason for the tightening of regulations for the very small homes, which is the burden of the main part of the requirements regulations, although the root of the problem appears to us to be the combination of insufficient and inadequate public-sector accommodation with a degree of unthinking encouragement of diversification to the private sector, which took place a few years ago under the present Government. Unfortunately, we are all reaping the rewards of that, and elderly people in those homes are among those who sometimes have cause to be concerned about it.
  The Minister said that there was doubt in the Department whether the regulations dealt adequately with the position of these very small homes. That may be so, but we doubt whether these regulations are any better in meeting the aim that he suggests they seek to meet. Were it not for the fact that they include the provision for students, which is urgent, I should have suggested to the Minister that he ought to consider withdrawing the regulations and re-submitting them in the autumn when they have been examined more carefully.
  Regulation 2(2)(f)(ii) stems from a problem that has arisen more than once: whether a home that purports to provide care for a particular type of resident with a particular kind of need has residents who are in a different category. The phraseology refers to
  "the category of personal care for which the establishment provides"
  such care. It does not seem to us that that necessarily makes any difference, or makes it more enforceable. That may be a tighter definition of the category of care that is provided by the establishment, but whether the individuals living in the home come into that category and need that level of care, and therefore that level of public support, may not be met by the phraseology of this regulation. It is not clear to us that the wording resolves the problem that the Minister has identified.
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  The Minister also said that the regulations refer to a responsible person being available throughout the day. was pleased to hear him say that they mean that a responsible person, although not necessarily the same responsible person, has to be on duty throughout the day. That is what we hoped and presumed he meant, but that is not what the regulations say.
  We are also a little concerned that the regulation suggests that the person who is on duty or on call should at all times be the person who is predominantly employed to provide personal care. Again, I recognise that the Government are seeking to ensure that those who provide personal care are qualified to do so. Even in a quite small home, those who are qualified to provide personal care may be employed on administration for much of their time. It is acceptable to all concerned that from time to time they should be employed on care duties, but that is not their primary task. It is not, therefore, a question of the regulations being wrong, but of the drafting of the regulations being less helpful than it might be.
  Regulation 2(2)(f)(i) refers to "personal care" being
  "provided by at least two employed or self-employed persons".
  Is the Minister confident that a home that is run by members of a religious order will always satisfy that condition? If there is any question about it, perhaps the Minister will be good enough to look into it. We are accustomed to the Department having to introduce amending regulations to correct regulations that have already been introduced. We should seek to be relatively charitable about that, if amending regulations were found to be necessary.
  The Minister referred to the fact that decisions will be in the hands of adjudication officers and to the specific requirements that have been set out for their guidance. Their task is to ensure that the conditions are complied with and that they continue to be complied with, but it is not clear to us how they are expected to do that. The definition in the regulations may still leave them open to abuse. I am wondering what checks the adjudication officers are expected to carry out. For example, how will they check that staff have had at least one year's relevant experience? Will they take the proprietor's word for it, or will they employ checks of their own?
  Thus far we have been concerned simply with clarity. We assume that the Government's intentions are those that we have identified. However, there are a few aspects of the regulations that cause us concern. The Minister referred to the fact that the intention is to provide transitional protection for those who are now in receipt of benefit but who, through no fault of their own, may not in future be entitled to benefit in exactly the same circumstances.
  As we read the regulations, this protection will apply only if benefits have been awarded under the residential care provisions of schedule 1 before 27 July 1987. It will not apply if the claim is made before 27 July but no decision has been reached. Even during the short time that he has been in the Department I am sure that the Minister will have realised that there is great concern throughout the country at the burden that is placed on local DHSS offices and the speed with which they are able to deal with claims. It seems to us to be completely wrong and wholly unjustified that people might lose protection because, although they made their claim in time, delay in dealing with the claim resulted in no decision having been made.

  397
  Similarly, an adjudication officer may reach a decision on such a claim before 27 July, but the claimant may decide to appeal. The appeal tribunal may overturn the decision of the adjudication officer. However, as we read the regulations, even if the tribunal's decision were made before 27 July, it would still be ruled to be incorrect, because the determination ought to have been made by the adjudication officer. Therefore, the transitional protection will still be lost. We do not believe that is the intention, but that seems to be the effect of the regulations. We believe that the date of the original decision on the claim should matter and that it should be possible to overturn it, once the matter goes to appeal, by the decision of the tribunal.
  The Minister also referred to the way in which transitional protection will apply. He said that a person will not lose entitlement if he is temporarily absent from the home in question; but when we are talking about homes and individuals who need a fairly high level of care it concerns me—and I am sure that it will concern the House—that people are most likely to he absent from a home for a short period of time through illness. According to the wording of the regulations, that is precisely the circumstance in which they will lose their transitional protection.
  I draw to the Minister's attention a case that was brought to me fairly recently. It does not relate to a residential home, but the principle is the same. A 72-yearold lady on supplementary pension was also receiving a central heating addition. The Government abolished the central heating addition last summer but provided transitional protection. At the end of April she went into hospital for 12 days. She has now lost her central heating addition. As she was in hospital, she lost her right to supplementary benefit for those 12 days. Although the Government say that that is not the intention, it appears that somebody who goes into hospital may lose their transitional protection. Furthermore, those who are resident in a small home that is not receiving the full payment for them may find that their right to a place in the home is placed in jeopardy. We hope that that is not the Government's intention, but we fear that that is the effect of the regulations.
  As for the Christmas bonus regulations, I congratulate the hon. Member for Brentwood and Ongar (Mr. McCrindle) on spotting what I suspect was a Freudian slip by the Minister, or by whoever drafted his speech. He said that this was the last time that this debate would be necessary, because the only time that such a debate might be necessary in future would be if the Government decided to increase the Christmas bonus. Between 1974 and 1979, when the Conservatives were in Opposition, they said that the Christmas bonus was inadequate. However, they were unable to increase it in the 1979 to 1983 Parliament. They were also unable to increase it in the last Parliament.
  Mr. Peter Thurnham: Will the hon. Lady give way?
  Mrs. Beckett: No, not for the moment.
  It looks as though the Government have decided, despite their wonderful economic successes——
  Mr. Thurnham: The last Labour Government took it away.
  Mrs. Beckett: The hon. Gentleman says that we took it away. The Opposition have never disputed that during the lifetime of the last Labour Government, who did not enjoy the benefits of North sea oil, there was the odd economic problem. The Conservative party has just fought an election campaign in which it said that this country has not been so well off for years and that we are rolling in economic success. However, the Minister tells us that the Government cannot afford to increase the £10 Christmas bonus throughout the lifetime of this Parliament and that we shall not need to debate it again. Had it been indexed, the real value of the Christmas bonus should now be £44, not £10. It will undoubtedly become a very minor part of a pensioner's income.
  During the election campaign, the Opposition said that the main basic pension, rather than the Christmas bonus, should be the source of remuneration. Even if it were £44, it would still be a minor part of a pensioner's income. We suggested a basic pension increase of £5 for a single pensioner and £8 for a married couple. If that is compared with the 80p that the Government have given in recent years, that is quite generous.
  I plead with the Minister not to use the statistics that the Department is delighted to have discovered. They suggest that pensioners' incomes are increasing twice as fast as those of everyone else and that they are increasing much faster than between 1974 and 1979. Pensioners' incomes have gone up so much during the past few years because of the earnings-related pension scheme, and the underpinning that it provided for good occupational pension schemes, which was introduced by the Labour Government in 1975. It is precisely the scheme that the Government spent so many hours last year destroying. State earnings-related scheme benefits have been halved, and the Government have undermined even the basis of good occupational pension schemes which now have to meet much lower standards.
  It is a little dodgy for the Government to take credit for something that they have just destroyed. We will treat the Minister gently on this occasion, but it is only fair to warn him that we will not be so kind in future.
  Mr. Michael Stern: As the hon. Lady said that the Government are in the process of destroying good occupational pension schemes, could she explain why the providers of pension schemes are not only providing the schemes at a rate as never before, but are looking forward to unprecedented expansion in their industry?
  Mrs. Beckett: I have no difficulty in accepting the hon. Gentleman's case. They would be very unwise if they did not take that attitude. They are in the business of providing pensions and making money out of it. They see an excellent opportunity for expanding what are known as personal pensions.
  It is within the recollection of the hon. Gentleman—though not of all of his colleagues—that the pension industry was very alarmed and expressed great concern about the way in which the standard and occupational pension schemes are being undermined. It believes that the provisions for personal pensions will cause terrific problems in the future.
  Now that the Government are being so unwise as to go ahead, flying in the face of their advice, people in the industry will try to sell as many pension schemes as they

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  can and try to make as much money as possible. They would be crazy not to do so. But that does not mean that they believed then, or that they believe now, that the Government were wise to do so.
  The lump sum regulations are the product of the Government's habitual penny-pinching. That is bad enough, but it is a little dangerous if that becomes more force of habit and the Government assume parliamentary decisions. That, unfortunately, is what has happened here.
  The regulation was not in practice what the Government told us it would be in their notes on clauses on the Social Security Act 1986. The notes suggested that the bonus would be paid in the first week of December and referred to the date on which it is currently paid. It means that this year, and I think next year, the bonus will be paid a week later. That is only a minor inconvenience to pensioners, but it is still an inconvenience, and no doubt the Government will make an equally minor saving at the expense of pensioners by way of interest payments on the sums involved. I cannot envisage any other advantage.
  Although this is a comparatively minor issue, issuing leaflets which announce the new (late without indicating that it is subject to confirmation by Parliament suggests that the Department is getting into the habit of assuming that everything will go through and be OK. Even though the Under-Secretary was in the Government Whips' office, he may have noticed that the Department has occasionally landed itself with the odd problem through just that kind of assumption. That sort of attitude could lead to problems, given the enormous amount of material which should go into primary legislation but which will be put into regulations between now and next April. On this occasion we do not blame the Under-Secretary or the Minister for Social Security and the Disabled because they were not in their present posts when the decisions were taken. However, by the autumn they will have been in the Department long enough to realise that they will have to take the consequences of their actions.
  The issues dealt with in the regulations are not major issues of principle but they cause concern and inconvenience, and perhaps point to the Department's attitude. The Department is faced with a mass of legislation and it is worrying to note that these provisions have not been properly drafted, that Ministers' intentions are not properly conveyed, and that parliamentary approval has been taken for granted. Let us hope that after the summer recess, when everybody has had a rest, this kind of thing will not happen again.
  5.23 pm
  Dame Jill Knight: As this is the first time that I have spoken since you have been in the Chair, Madam Deputy Speaker, perhaps I may add my name to those who have congratulated you. Perhaps the ladies among us are more pleased to see you there than the gentlemen. [HON. MEMBERS: "No."] I am so pleased that hon. Members came back on that; I hoped they would. I would never make the mistake of calling you a piece of furniture, Madam Deputy Speaker. You are not a chair; you are the Deputy Speaker.
  I also congratulate my hon. Friend the Under-Secretary of State on his first appearance at the Dispatch Box and I welcome his remarks warmly.
  I do not want to delay the House, but there are one or two points about which I feel rather strongly. The hon. Member for Derby, South (Mrs. Beckett) accused us of
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  being penny-pinching in our expenditure on social security. The amount that we spend is now £46.000 million per annum. If that is penny-pinching, God help us if we ever have a profligate Government. It is important to recognise that we must pay our elderly people what we can afford and ensure that, as the country becomes more prosperous, its elderly people get their share. I believe that that is happening. The Christmas bonus can hardly be described as penny-pinching, as even taken alone it costs £114 million.
  Mr. Thurnham: Would my hon. Friend agree that the penny-pinching took place in 1975–76 when the Christmas bonus was not paid and that that was a dreadful thing to do? Would she agree that we should welcome the regulations, which make the payment automatic?
  Dame Jill Knight: I agree absolutely. I warmly support the Government's proposals and I am amazed that the Opposition should have the bare-faced cheek to talk to us in such terms about the Christmas bonus.
  However, I am always a little concerned when money is spent on all pensioners. I should prefer public money to be directed to those in real need. Some elderly people do not need the Christmas bonus. Some millionaires living in large homes get the Christmas bonus, although I suppose that we must derive some comfort from the fact that they pay tax on it.
  I suggest to my hon. Friend the Under-Secretary of State that, now that he is embarking on his career in the Department, which I hope will be a long one, he should re-examine supplementary benefit limits and the way in which they work. I am sure that I am not alone in being troubled by the fact that many people who fall a copper or two over the point at which supplementary benefit is payable lose so much. Many other benefits flow from supplementary benefit and it is rather hard on someone who finds that, because he is not quite at the limit at which supplementary benefit is payable, he cannot get glasses, coal or other help.
  I have always thought that it would be worth considering a system of graded help for those whose incomes are just a little above the level at which supplementary benefit becomes payable. Perhaps they should be afforded some of the benefits, with those whose incomes are a little higher receiving slightly fewer. We should not have a sharp cut-off point which means that one gets all or nothing.
  In considering help for elderly people, we rightly examine the residential care angle and the fact that it is nearly always better to keep people in their own homes if possible. Home helps, meals on wheels, and so on are important to achieve that, as the Government have acknowledged. Will the Government look at the meals on wheels system in particular? It was organised solely by the Women's Royal Voluntary Service and costs hardly anything because volunteers took the meals around There are still some volunteers, but recent figures show that the service could be extended if there were more voluntary helpers. This may be too far-reaching an idea, but, in making help available to those who need it, it is crucial to recognise that there are people—thank God for them—who are prepared to work voluntarily taking meals to elderly people, doing their shopping, and so on. If we looked more towards bodies such as the WRVS, we might be able to make the service available more widely because of the savings which would be made.

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  Old people are very conscious of the problems of law and order. They talk and write about them a lot. They worry about the dangers they face when going out. It is not just a matter of increasing the number of police and neighbourhood watches, although that scheme is important and has helped many elderly people. I should like to tell the House about one of my constituents, an 84-year-old lady who was going into her flat when a young man came up to her, said that he did not have his security key and asked whether she would let him in. To a certain extent, people would say that she was to blame, but the young man looked reasonable and trustworthy, so she let him in. He took her into the lift up to the top and raped her. Theat is a terrible thing to happen to any woman, and one can only imagine what it was like for a frail elderly person. I plead with the Government to recognise that old people are at risk in tower blocks and to introduce a system that might help.
  I am proud to be part of a Government who consistently try to ensure that pensioners are never in need. The days when they were have gone, thank God. I despair at some of the publicity launched against us — for instance, comments that pensioners in this country do worse than in any part of Europe. That story came out recently in the Daily Mirror and was proved false because the article did not compare like with like. It did not mention the extra pensions—for example, from the state earnings-related pension scheme — received by our elderly people. The article added those benefits or similar ones to European benefits to try to prove that European pensions were better, but did not compare like with like. When that type of story gets out, many people are aggrieved and feel that they are not fairly treated. That is not true. One of the major jobs of my hon. Friend the Under-Secretary of State in his new task will be to make more widely known and understood exactly what is available and how it compares with countries on the continent.
  5.33 pm
  Mr. Archy Kirkwood: I listened with interest to the hon. Member for Birmingham, Edgbaston (Dame J. Knight). I understand what she means when she says that making all benefits universal is a policy which is too expensive. There are admittedly problems in meeting the cost of universal benefits but, if I followed the hon. Lady correctly, she went on to argue that the selective system of giving help to those on supplementary benefit was unfair as it affected those whose incomes were only slightly above the level at which it was payable. May I gently suggest that she is trying to have it both ways. With a universal system, one gets around the second problem. With a means-tested benefit, one does not have the first problem.
  Dame Jill Knight: I do not think that the hon. Gentleman's remarks follow from what I said. I was trying to say that when benefits are automatically universal many well-off people get the scarce Government help. Surely the hon. Gentleman can see the difference between that and not having such a sharp cut-off point. I am talking, not about millionaires receiving supplementary benefit, but about the poor people who earn just a penny or two over the level at which it becomes payable. There is a difference.
  Mr. Kirkwood: I do not think that I misunderstood the hon. Lady. My interpretation of her remarks stands, but I do not want to make an issue of the apparent contradiction.
  A new Treasury Bench team is looking after social security. I join in the welcome given to the new Parliamentary Under-Secretary of State and the new Minister for Social Security and the Disabled. The Minister will have his work cut out to match the promotion enjoyed by previous incumbents of his office, one of whom is now Chief Secretary to the Treasury—a hard act to follow. I wish the hon. Gentleman well. I hope that the House can take some comfort and succour from the fact that a couple of fresh and active minds have been brought to consider the thorny problems of social security. Those intractable problems have taxed bright brains in the past. I, for one, hope that Ministers will take the opportunity to consider in depth some of the principles behind the social security system. They are very technical. Although there were some changes in the Social Security Act 1986, I hope that the Minister, who will be charged with the responsibility of implementing some of them, will consider some of the longer-term problems and underlying principles behind the issues. That would be to the benefit of everyone.
  I understand that the notional element of the student grant is attributable to books and equipment and that disregard is awarded in calculating entitlement to supplementary benefit. That has been the system for some time. The figure is regularly revised and the draft regulations increase it from £187 to £210. In so far as it goes, we welcome the increase. I am told that the books element is not increased in accordance with the index of book prices, but that the Department of Education and Science carries out a technical exercise every so often to attribute this so-called notional element of the student grant to various items for social security and other purposes.
  We have had the advantage of the 1968 Brown report. Given the evidence submitted by the National Union of Students and the Department of Education and Science to the Select Committee on Education, Science and Arts when it considered students awards, there is a case for looking at the possibility of indexing some of the disregard elements. As the hon. Member for Derby, South (Mrs. Beckett) said, the increase required to bring the books, equipment and materials disregard in the student award up to the level recommended by the Brown committee in 1968 would be 68·5 per cent., instead of the present 12·3 per cent. There is evidence that the system of periodic reviews and investigation of the indexation of those disregards should be put on a more regular basis, or inevitably the books, equipment and materials element of the student grant will fall below the disregard portion of supplementary benefit.
  It is a long time since I was at university, but to try to cover books, equipment and materials for a course such as mine—an applied science course in pharmacy at Heriot-Watt university—with £187 is a figment of the imagination of the DES. I have just paid £12·95 for a copy of the book by the right hon. Member for Henley (Mr. Heseltine), which I do not consider to be of particularly good value, although it is an interesting book. However, if his book cost £12·95, what chance does one have of obtaining a decent scientific textbook for half that price? I hope that the Department will consider that point.

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  Will the Minister say what the cost of this change will be for forgone expenditure and social security? I do not think that it will cost very much, and I appreciate that it is not possible to calculate the amount this afternoon, but I should be grateful if somebody would drop me a note and explain the long-term cost of this change to the Exchequer.
  The statements that were made by the Minister's predecessors about how the order would mitigate some of the other cuts in student grants rang slightly hollow. Student grants have been suffering severely and, although this increase is welcome in so far as it goes, those students who are diligently trying to do their work and equip themselves properly will still experience difficulties.
  I shall now deal with regulations on residential homes. I noticed in an article in The Guardian last Saturday that there is a problem, of which the Department is well aware, with regard to the financing of residential care. I understand that to debate that matter would be to take the point wider than the regulations, but I hope that the Minister will consider the financing of residential care and the relationship between the private and public sectors and that between the DHSS and local authorities. We should take an early opportunity to debate at some length the longer-term policy implications of those issues.
  I am worried, as is the hon. Member for Derby, South, about transitional protection. I hope that the number of people about whom we are talking with regard to transitional cover is not great. Does the Minister have any figures of how many people will be covered by the transitional protection? I should like an assurance from the Minister that they will be properly looked after.
  I understand the necessity for introducing the regulations to clarify the legal position, and I welcome the amendment in so far as it is necessary. I am aware of some evidence of abuse of the system, which I think was localised. It is perfectly proper for us to guard jealously the public purse as much as possible. If the Department is making changes to prevent such abuses in the future, that is welcome.
  With regard to what is happening in social work homes in south London, we must be careful that we do not accept that local authorities are the be-all and end-all of oversight. We are giving local authorities the power to oversee private residential accommodation, of which I approve, but there is evidence that some local authority homes—part III homes in England and Wales and part IV homes in Scotland—may require inspection. Who will police the provisions that are made by the local authority?
  The Department of Health and Social Security should recognise that we are asking local authorities to undertake quite a lot of extra work to ensure that these new homes with four places or fewer are properly looked after. I hope that that will be taken into account with regard to the facilities that are made available to the local authority social work departments and social services departments. The Under-Secretary of State will be aware that regulations north of the border are governed by the Social Work (Scotland) Act 1968. Those regulations are quite different, because we have never had a restriction or deregulation of homes that have fewer than four places. The experience that has been gained in Scotland since 1968 is instructive and would bear examination. The Minister's Department would benefit from the lessons that we have learnt.
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  Let me now deal with the Christmas bonus. I am puzzled by the expenditure provision under the Christmas bonus head in the expenditure White Paper, Cmnd. 56-II, which was published in January 1987. I think I heard the Under-Secretary say that the total cost of the Christmas bonus this year was some £114 million. For 1987–88 the provision in the White Paper is £108 million, but it falls in 1988–89 from £108 million to £100 million, and it stays at that level for 1989–90. I cannot understand why the provision in the White Paper should fall, unless people are coming out of benefit and therefore there are fewer claimants. I hope that the Minister will explain that matter, because I cannot understandt why that should happen.
  The Minister would be well advised to take the opportunity of coming fresh to his office to look back at the 1972 debates. The Government were pressed by high and spiralling inflation rates into a difficult position. I was reading the debates this morning, and I noted that some hon. Members were claiming that that position was due to the imminence of the Sutton and Cheam by-election. The Minister will know that area well because of the location of his constituency, and he will be aware that the Government lost that by-election. The position at that time was that the measure was an earnest of the Government's good intentions, that it would be a one-off payment and that it was designed to secure a prices and incomes policy with the TUC and the CBI. The 8 million people who qualified for the payment in 1972 cost the Government £80 million. It is instructive to note that in 1987 the cost is still £114 million, if that is the current figure. That speaks volumes about the way that the value of the Christmas bonus has been eroded. The figures that were supplied to me by the Library show that the value of the Christmas bonus, compared with 1972 prices, is £2·26. One cannot go very far on £2·26.
  If that amount were valorised according to the retail prices index at today's prices, the Christmas bonus would amount to £44·29. That would be a significant sum of money to have and it would be welcomed by pensioners at Christmas. That is why at the last election we tried to persuade the Government to double the payment of the pension for Christmas. I realise that that would cost some £370 million in addition to the £114 million that the Government are spending, but if the payment is to be made it should be of an amount that is worth having and not the rather derisory figure of £2·26. If the Government do not take active steps to increase that amount it will simply wither on the vine and become valueless.
  I remind the Under-Secretary that under the Pensioners' Payments and Social Security Act 1979, which makes the payment compulsory, the Government have the necessary power. Section 4(3) says:
  "If it appears to the Secretary of State that, having regard to the economic situation in the United Kingdom, the standard of living in the United Kingdom and such other matters as he considers relevant, the sums…should be larger",
  he has the power to provide accordingly. There is an argument for saying that the economic situation and the standard of living in the United Kingdom call for that power to be used and for the increase to be made.
  Although nobody in the House, least of all the Under-Secretary, is looking for debates on social security statutory instruments, we will lose the opportunity of rehearsing the arguments about the value of the Christmas

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  bonus after the provisions of the Social Security Act 1986 come into effect and the increase is made automatically. Therefore, we should consider doubling the pension in the first week of December, rather than merely giving the amount that is provided for by the order.
  I agree with the hon. Member for Derbyshire, South——
  Mrs. Beckett: Derby, South.
  Mr. Kirkwood: I apologise to the hon. Lady; that is a monstrous insult.
  I agree with the hon. Member for Derby, South that, on the face of them, the order and the regulations do not contain heavy principles. However, I hope that I have been able to persuade the Minister that there are important underlying strands of principle that go to the heart of our social security system that require his continuous and continuing urgent attention so that we get the provisions for the under-privileged groups right in the future. I hope that he will study the remarks that have been made from both sides of the House during the debate, reflect on them and take appropriate action.
  5.50 pm
  Mr. Peter Thurnham: I welcome the statement by my hon. Friend the Minister, not only for its content but for the opportunity it provides to debate all that the Government have done for the elderly, not only with pensions but with increased spending on the National Health Service and law and order. It also gives us an opportunity to contrast the Government's record with the poor record of the Labour party when it was in power, supported by the Liberal party. The Labour party indulged in the penny-pinching and did not pay the Christmas bonus at all in 1975 and 1976. The hon. Member for Derby, South (Mrs. Beckett) glossed over that by saying that the then Labour Government had had the odd economic problem. It was because the Labour party had those economic problems that the electorate came to the conclusion that it did in 1979, 1983 and again with such resounding success in June this year, when it returned the Conservative party with such a large majority.
  The economic problems cannot be glossed over. Every section of the community is equally concerned about them and will not forgive the Liberal party for having supported the Labour party when it was in power and kept it going for a year longer than it need have done.
  This is an important debate. There is a record number of pensioners in this country: 10 million in total. We have the second highest proportion of elderly in the population in Europe. The figures show that there are about 15,000 pensioners in my constituency.
  I understand that the cost of this measure will be £114 million. The £10 bonus was introduced by the Conservative Government in 1972 and it is to be welcomed. The promises that were made by the Labour party are hollow. It promised £5 extra on the pension for a single person and £8 for a couple. That seems to he nothing but a cruel deceit because it did nothing to enhance the prospects for the poorest pensioners who are dependent on supplementary benefit and would not have benefited by an increase in the basic pension. It showed a failure to understand the importance of controlling public spending and targeting it on those who are most in need.
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  Surely this Government's provisions are right. The standard of living of pensioners should depend not on the basic pension alone but upon occupational pensions as well. I remind Opposition Members that over 50 per cent. of pensioners now have occupational pensions and in the future we can expect that figure to rise to 70 per cent. or more as it relates to the current position of pensioners who have just reached pensionable age. Surely it is better to target any other funds on those who are most in need by ensuring that they have sufficient supplementary benefit.
  There has been an increase in the level of benefit and the real standard of living of the poorest in our population. The figures quoted by my hon. Friend the Minister show that pensioners are no longer the poorest in our society to the extent that they were. We can take great comfort from the fact that the Government are targeting resources so that we can see the increase in the standard of living spread throughout the community.
  We know that pensioners have benefited more than any other section of the community in their standard of living. It was wrong of the Daily Mirror to print an article that seemed to suggest that this country's pensions were the lowest. In fact, our spending on the elderly is the third highest in Europe, after France and Denmark, and we should have a table printed, at least in The Sun if not in the Daily Mirror, which makes that clear to as many people as possible.
  I should like to echo the remarks of my hon. Friend the Member for Birmingham, Edgbaston (Dame J. Knight) who referred to law and order. Spending on other areas is important to pensioners. The latest figures I have show that 13,000 people aged 60 or over were victims of attempted murder, wounding, assault, rape, robbery or theft from the person. It is important that the Government make adequate provision in that area. The size of the police force has been increased by 10,000 officers already and there are plans to recruit a further 3,000 officers over the next few years. I press the Government on the importance of implementing those plans and ensuring that we have 3,000 more bobbies on the beat.
  Our record contrasts strongly with that of the Labour party which presided over a police force whose morale as well as its numbers was collapsing. The officers just sat in panda cars and did not go out on the beat.
  Mr. Tony Lloyd: That is a remarkable diatribe from the hon. Gentleman. He has to face up to the fact, even if he wants to play party politics, that we have a serious crime wave in this country. Many of the victims are elderly people. If we take politics out of the issue and start talking seriously, the hon. Gentleman would do far better by urging his Front Bench to look at it as a real issue and not sit back complacently and pretend that something realistic is being done. Crime has doubled under this Government.
  Mr. Thurnham: I am surprised at the hon. Gentleman making such an intervention. He should be addressing his remarks to the Manchester city police committee, which has done nothing but damn the neighbourhood watch schemes that have been introduced so successfully in other areas. I press him to see that more neighbourhood watch schemes are introduced in Manchester. It has been shown that they are of great benefit and comfort to people. They not only help with the reduction of crime and provide a greater feeling of security and safety; they also bring

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  people together and introduce neighbours to one another in a way that can be particularly helpful to senior members of the community.
  I should like to draw attention to Government spending on the NHS. A total of 40 per cent. of the spending is for old age pensioners. There has been a considerable increase in the number of operations relating to elderly people. For instance, the number of cataract operations has risen from 38,000 in 1978 to 55,000 in 1984, with a target of 70,000 for 1990. I am pleased to see that in Bolton many of the operations are now being conducted in the private sector, paid for by the NHS, because they are done more cheaply in the private sector. Similarly, the number of hip replacement operations has increased from 28,000 in 1978 to 38,000 in 1984, with a declared target of 48,000 for 1990. That shows how much the Government are doing in making extra provision for the elderly.
  Mr. Peter Pike: We seem to be moving away from the subject of the debate. How can the hon. Gentleman explain the situation in a health authority not that far from his constituency — Burnley, Pendle and Rossendale? It is closing hospitals and transferring work to the private sector, to a private hospital called Gisburne park hospital, which has made a loss—
  Mr. Deputy Speaker (Miss Betty Boothroyd): Order. We are straying far from the terms of the debate. I ask hon. Members to keep to the terms of the debate, of which they are perfectly aware.
  Mr. Thurnham: Spending on the NHS is up by 26 per cent. in real terms since the Labour party was in power. That is evidence of the care that the Government provide for the elderly.
  The provision of occupational pensions is a valuable feature of what is being done by the Government to ensure that the standard of living of pensioners is high. That is why we are not simply calling for pensions to be increased across the board. With 10 million pensioners, the cost of doing that would be absolutely prodigious.
  I much prefer to see spending targeted at those who need it most, including the disabled for whom spending has been substantially increased, and an increase in the number of home helps. My figures show that the number of home helps has risen by over 14 per cent. since 1979. That is the way in which the elderly can be kept at home where they want to stay. They will not be made to leave home because of a lack of care, facilities and personal social services. Since 1979, spending on personal social services has risen in real terms by over 20 per cent. For those who are unable to live on their own, there are now over 220,000 places in residential homes, compared with only 180,000 in 1979.
  The figures show that the Government are spending and caring more for the elderly. The people were right to elect the Government to care for the elderly and not pay attention to the Opposition's false promises.
  6 pm
  Mr. Michael Stern: It is always a pleasure to follow my hon. Friend the Member for Bolton, North-East (Mr. Thurnham), given our knowledge of the work that he has done for the handicapped. It is equally pleasurable to follow the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood). He reintroduced one of the dottier ideas that surfaced briefly
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  during the recent election campaign. No doubt he has said a fond farewell to it before it is buried in the graveyard that is specially reserved for Liberal policies that are tried out and shot down as quickly as they appear.
  The idea that anyone on benefit should receive an extra week's payment instead of a fixed amount of Christmas bonus seems to be designed to appeal to nobody except the administrators, who would clap their hands in glee at the extra jobs that would be created for them. It should be clear that a fixed payment to a discrete group will be rather easier to administer than a variable payment of about 100 or so different rates that, in the case of some pensions, would start at 5p per week. I wonder what a pensioner will say when he is told that his £10 annual payment will be replaced by 5p. We will end up with a system that benefits virtually no one other than administrators but is designed to be seen to be doing something different.
  The hon. Member for Derby, South (Mrs. Beckett) accused the Government of being penny-pinching. We frequently hear Opposition Members make that accusation. Just as the hon. Lady chided my hon. Friend the Minister—and all of us are delighted to welcome him to his new post—I briefly chide her. She should be wary of sounding too much like her senior colleague the hon. Member for Oldham, West (Mr. Meacher) in greeting every social security announcement that is made by the Government with a cry of woe and disaster, saying that it is the last straw that will destroy for ever the hopes of all pensioners.
  The hon. Lady accused the Government of penny-pinching because they recognise the need for a calendar. If an annual payment is made on a particular day of the week, we shall allow it to slip back one day, or sometimes two days, per year. If we do not correct that, we shall end up with a Christmas bonus being paid in August. Alternatively, we must take the action that the Government have proposed, which is periodically to step in and correct the malfunction in the calendar.
  It is unfair to accuse the Government of penny-pinching. That accusation has been made twice today. This morning I saw it in a newspaper, the name of which I shall not quote because I should not want my constituents to know that I read that newspaper. In ringing terms, it made the accusation that the sole purpose of adjusting the date of the Christmas bonus was for the Government to save money. That accusation needs to be looked at in more detail. The Christmas bonus, whether it be paid on 3 or 10 December, will either be saved or spent by pensioners. If it is spent, pensioners will lose nothing. Indeed, experience of previous Christmases shows that very often the later that money is spent, the better the the value that is received, as many shops attempt to cash in on Christmas trade by lowering prices just before or after Christmas.
  Let us assume the worst case: that a pensioner decides to save his or her Christmas bonus. At that point, one may say, "The Government are penny-pinching because the Christmas bonus is being paid a week later." Where is the vast loss to pensioners? We are talking about a sum of £10 that is paid one week late. If we assume that that money will be invested at an average rate of 10 per cent, a year, by having that money a week later, the loss to each pensioner is 2p before tax.
  Mr. Tim Boswell: Does my hon. Friend agree that the global calculation also shows that the maximum possible loss to the Government will be one

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  week's interest on the total £114 million that is paid out, which, in turn, on any realistic assumption, comes to well under £1 million?
  Mr. Stern: My hon. Friend is entirely right. We are still dealing with an Opposition who would rather accuse the Government of crime upon crime — that is, saving money—than look instead at sensible administration of the social security budget at virtually no cost to anybody.
  My hon. Friend the Minister is right—indeed, there is broad all-party agreement on the matter—to welcome the regulations relating to supplementary benefit for small residential care homes. I am sure that he will agree that it is a small step in a minefield that still needs a great deal of attention. The relationship between residential homes—it is irrelevant whether we talk about publicly-owned, privately-owned or voluntary residential homes — patients, and various aspects of the benefit system is complex and mistakes are frequently made.
  In my constituency, an excellent voluntary home called Cherry Orchards is run by the Camphill Community. I have a great deal of admiration for it. Unlike many homes in the public and private sectors, it has a niche in the provision of care of patients who are so physically and mentally disabled that it is almost impossible to fit them into any other similar home. Such organisations are to be praised for taking on the most difficult task in that respect. That community home found itself in an impossible position in terms of benefits. For totally valid reasons—I do not wish to be seen in any way to be denigrating the highly professional work of the Department of Health and Social Security in the county of Avon—it could not pick up the benefits to which many of its patients were entitled because it was not able to work through the bureaucratic elements of gaining the necessary registration and, therefore, being eligible under the regulations for the payment of benefit.
  I urge my hon. Friend, during the fruitful period that he will spend in the Department, to look again at many of the regulations that affect the relationship between all sectors of residential care and the benefit system to try to find ways to publicise the benefits that are available and the ease of access to them so that we can make sure that the will of Parliament is not frustrated by over-complex regulations that ensure that benefits are not available when they are needed.
  I remind my hon. Friend of another case about which I am currently in correspondence with the Department and which makes the same point in a different way. In this case, which relates to attendance allowance, a respected pillar of the community is about to be sued by the Department as a result of an entirely understandable mistake in relation to the regulations. I appeal to my hon. Friend the Minister to stop the damage before it is too late.
  With regard to the student grant disregard, there can be no greater praise for the Government's proposal than the fact, cited by the hon. Member for Derby, South, that the National Union of Students disapproves of the change. In welcoming the order, I remind my hon. Friend the Minister of the very much greater task that awaits him. It has been common policy throughout the House for a long time that in considering student support we should be moving away from dependence on benefit towards a knowledge of the income to which a student is entitled. I
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  hope that the order is but the first stage in the rationalisation of provision for students promised by the Government in the course of this Parliament — a promise that was universally attacked by the Opposition parties in the general election.
  I hope that this will be one of the last orders to be considered in relation to benefit payments for students, not because students should not receive benefits but because the benefit system was never designed to deal with student support. The quicker we move away from the benefit system acting as part of student support, the easier it will be to achieve the much-needed rationalisation of student support and of the benefit system.
  6.12 pm
  Mr. Tim Boswell: I begin by joining in the plaudits to my hon. Friend the Member for Enfield, Southgate (Mr. Portillo) on his maiden appearance at the Dispatch Box. I use the term "hon. Friend" advisedly, as he and I had the honour and privilege of serving the Government some years ago as special advisers. To mix metaphors a little, my hon. Friend may feel that he has leapt from the boiler room into the frying pan.
  During my election campaign in a widely scattered and mixed community, I was surprised at the large number of small residential care homes and activities, in addition to those of which I knew already, which form an important part both of social provision in the area and of the economic life of the rural villages. Indeed, that type of activity may be a more appropriate use and creator of employment in small settlements than, for example, small industrial estates.
  My second and substantial point in this regard is that tightening the regulations for supplementary benefit in homes below registration level may, by a side wind, achieve the improvement in standards that we all wish to see. In my view, therefore, it is a move forward.
  I am pleased to refer to the Christmas bonus, for two reasons. First, Conservative Members can do so with a clear conscience because, ever since 1972, when we introduced the bonus, whenever we have been in power with the opportunity to pay the bonus we have done so. As is well known, the Labour Government failed to do so on two occasions, whatever excuses the Opposition may advance today. Secondly, I was a prospective parliamentary candidate in 1972. The House may consider that I have finally reached this place after a rather long resting period. I was foremost in pressing for the introduction of a Christmas bonus to meet a social need. In that regard, I merely comment that if one casts one's bread on the waters, it may return after many days.
  With regard to the substance of the order, I hope that Ministers will not rest on their laurels, as there are important considerations to be taken forward for the future. Whatever the Christmas bonus was in 1972 or has been since, it is no longer the same in effect as it was when it was introduced, because life has marched on. The hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) referred to the powerful impact of inflation. I must agree that if in 1972 we had offered pensioners £2·28 they would not particularly have thanked us.
  The value of the bonus is therefore not what is was. Moreover, the absolute and unchanging level of the bonus has been accompanied not only by increases in state retirement pension and other state benefits but by the explosion in occupational pension schemes, leading to a

  411
  higher general income level for pensioners. The proportionate cost, merit and benefit of the bonus has thus been reduced by that factor, too.
  There is also the relentless march of administrative costs. Perhaps my hon. Friend the Minister will give details of the relative cost of paying out this fixed bonus. I believe that there is a strong advantage in its tax status and in the fact that it is a lump sum rather than a graduated amount subject to deductions. Nevertheless, the administrative cost must be rising proportionately year by year. In that context, it is appropriate to consider what might be done about the bonus in the future. The order locks it in for now, but I hope that it will not close our minds to what could be done later.
  During the election campaign, the pensioners for whom I felt most strongly and who felt that they were in greatest difficulty were those just above supplementary benefit level. Those who had very small savings or occupational pensions, especially if they retired some years ago, did not wish to plunge into the full cover of supplementary pension, if indeed they were entitled to do so, but they felt that they were under pressure and to some extent excluded from recent developments. A large reason for this has been the Government's success in containing inflation. I suspect that, if the 40p per week had been paid as part of an enhanced Christmas bonus, we might have received more thanks from those quarters.
  The costs of pension provision are now so huge that it is only honest for the Government to commit themselves to the realistic target of maintaining a link with prices. On my calculation, which may be shaky, the increase of a million pensioners since 1979 has contributed an increased annual cost to the Treasury of some £2 billion in retirement pensions alone. In other words, if the numbers had not increased, pensions might have been increased by between £4 and £5 per week. That must be a powerful consideration for anyone making sweeping proposals for a major increase in the weekly pension.
  The Christmas bonus provides a useful opportunity for flexibility. If we are saying that pensioners get protection from prices through their retirement pensions, it may be appropriate in the future to consider giving, through the medium of the Christmas bonus, some kind of bonus or social dividend reflecting the increase in prosperity in the country in due course restoring it to a more appropriate level. Therefore, it becomes not a problem for us but, I hope, an opportunity.
  In the light of the changes that have taken place since the benefit was introduced in 1972, I argue that the Government Front Bench should consider, in cricket parlance, either hitting out or getting out. In my experience, those who are prepared and go out and hit usually succeed in getting the ball to the boundary.
  6.20 pm
  Mr. Portillo: We have had a most interesting debate and I would like to thank the hon. Member for Derby, South (Mrs. Beckett) for her kind remarks and for treating me with kid gloves on my first outing. I also thank other hon. Members from both sides of the House for their kind remarks. I would particularly like to welcome my hon. Friend the Member for Daventry (Mr. Boswell), who is new to the House, and thank him for his kind remarks. I have noticed that in five weeks he has already spoken
  412
  perhaps more than some Members speak in five years. We have certainly heard some of his eloquence today, and he will make an important contribution here.
  I will try to deal with the points that have arisen under the three headings that we are debating—student grants, residential care and the Christmas bonus. I deal first of all with those points that were made about student grants. The hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) asked me about the method by which the disregard in respect of books and equipment is calculated, and why we chose to increase it from £187 to £210. At the risk of appearing to shuffle the question off to another Department, I am informed by my right hon. Friend the Secretary of State for Education and Science that the amount of the grant which it is reasonable for the Department of Health to regard as paid to help with the purchase of books and equipment and the precise level for that element of the grant are matters for the Department of Education and Science. I am sure that officers in his Department will be interested to read my hon. Friend's remarks.
  My hon. Friend the Member for Bristol, North-West (Mr. Stern) was concerned about proceeding with the aim of removing students from benefit. I remind him that the review under my hon. Friend the Member for Wantage (Mr. Jackson) on that subject continues. Doubtless he will be interested to read the conclusions of that review. It is likely that there will be cases—for example, students who are married to supplementary benefit or income support claimants— where it may be necessary to have some disregard in respect of books and equipment such as we have been discussing today.
  I turn now to the subject of residential care homes, which attracted the largest number of questions today. The hon. Member for Derby, South was concerned about the categories of client and whether the adjudication officer would be drawn into making judgments in those matters. The best I can say to her is that inevitably adjudication officers will be drawn into making judgments that will be difficult for them to make. However, what we are doing today improves the situation. It at least gives a clear basis on which the adjudication officer can begin to make some of those judgments. I hope that she will recognise that, although we are not moving into a perfect world, at least we are improving on where we are today.
  I congratulate the hon. Lady on the diligent way that she researched those orders and regulations and found all sorts of points and queries to raise. She also wanted to know whether it was intended that the transitional protection would apply only where a decision had already been made by an adjudication officer and what would happen if it was under appeal. The whole intention is to protect people who are already receiving money and who would therefore suffer some loss from the application of the rules from a particular date.
  Where the award has not yet been made or is under appeal, the money has not been awarded and there is no loss of income. We are concerned that people do not lose financially. We do not want people, as it were, turned out on the street. That is our prority in all this. I would also ask her to share the thought with me that, if we insist that care should be provided in residential homes with fewer than four residents, that in itself is a considerable step forward. It is not quite apparent to me that allowing people to slip under the net, as it were, would be of benefit to the residents.

  413
  The hon. Member for Roxburgh and Berwickshire was concerned that changes in respect of small homes would mean extra work for local authorities. That is not quite right, because what we are talking about is the work that is done by DHSS adjudication officers. They are the people who are concerned with making judgments as to whether payment should be made in respect of the care received in a small home. As I said in answer to the hon. Lady, we are making their work simpler, not more difficult.
  I had a feeling that the hon. Member for Roxburgh and Berwickshire was raising a more general point—whether we should now bring small residential homes with fewer than four residents into a registered system. That is debatable. There is certainly an argument for that and I know that a number of hon. Members believe that quite strongly. If the hon. Member is concerned about the work load on local authorities, there would be grave implications in bringing small homes into a registered system. At any rate, it cannot be the intention or the effect of supplementary benefit regulations to bring about a registration system, by proxy, as it were. That is really what we are debating today. If standards are to be laid down for small residential homes, they should apply to all small homes and to all residents, not just to homes with residents who claim supplementary benefit—who are the only people that we can address through the regulations today.
  A practical point is that adjudication officers do not have the necessary expertise to make judgments about proper standards of care, which is what would be involved if we tried, through the regulations, to impose a registered system. I explored that with the hon. Member for Derby, South. We shall have to await further developments. We are today laying in the Library the conclusions of the joint central and local government working party on supplementary benefit and residential care. That report, which may be of interest to my hon. Friend the Member for Bristol, North-West, recommends a simplified form of registration to be introduced for small homes. However, those recommendations need to be considered in turn by the community care review being undertaken by Sir Roy Griffiths, so we may need to hold our horses in that respect.
  Another point made by the hon. Member for Roxburgh and Berwickshire was that the House should have an opportunity to discuss the long-term arrangements for the financing of residential care. My hon. Friend the Member for Bristol, North-West was very close on that point. I think that they will both find the report laid in the Library today of great interest.
  Mr. Kirkwood: Will we debate it?
  Mr. Portillo: The hon. Gentleman will doubtless find an opportunity to bring that about, should he wish.
  The hon. Member for Derby, South made a series of interesting points of detail. I shall try to respond to as many of them as I can. She asked whether, if people went into hospital, that would affect their benefit. It is intended that there should be no loss to them provided that the person's stay in hospital is only temporary. In addition, they may get a retaining fee while they are in hospital to enable their place in the home to be kept free. The
  414
  definition of "temporary" is normally up to one year, but again it would be up to an adjudication officer to judge the circumstances that apply in a particular case.
  I fear that I am unable to help the hon. Member for Roxburgh and Berwickshire about how many people will be affected by the transitional arrangements. We intend to go back to the original policy. We think that most small homes which are currently regarded as equivalent to a registered home will meet the new requirements, which would tend to show a fairly small effect.
  The hon. Member for Derby, South made an interesting point about religious orders. The answer seems to be that for these purposes we would regard those in religious orders as being employed or self-employed. I am grateful to the hon. Lady for raising that point. The adjudication officer would then wish to judge whether the person, whether in a religious order or not, had the relevant experience.
  The hon. Member for Roxburgh and Berwickshire raised a point of great topicality when he asked who polices the local authority provision for the elderly. The local authorities have the statutory responsibility for monitoring and ensuring adequate standards in their homes. In limited circumstances the social services inspectorate has powers of entry. We are in discussion with representatives of local authorities about the social services inspectorate's programme of work designed to help authorities to improve the standard of care in homes.
  Dame Jill Knight: Some local authorities are not particularly sympathetic to the point made by the hon. Member for Derby, South (Mrs. Beckett) about religious homes. They will tend to cut grants if the home takes, say, only Roman Catholics. If a person is in need of care——
  Mr. Deputy Speaker (Mr. Harold Walker): Order. I do not see how that arises under this order.
  Mr. Portillo: My hon. Friend makes an interesting point, none the less, Mr. Deputy Speaker, and my right hon. Friend the Secretary of State has heard it.
  Let me offer a word of apology to the hon. Member for Derby, South. She has apparently uncovered a leaflet which refers to the date for the introduction of the £10 Christmas bonus. I have also discovered that leaflet, because I have, I hope, done my research as diligently as she has. It should have said that that was subject to parliamentary approval. I apologise to the hon. Lady and the House.
  The hon. Lady has made much of the point in this morning's newspapers and during the debate that we are in some way penny-pinching by changing the date. I do not wish to embarrass her, but let me read out the record during the period when she was in office. She reminded us that she was first a Government Whip. In 1975 and 1976, nothing was paid. In 1977, payment was made in the week beginning 5 December and in 1978 payment was made in the week beginning 4 December. There cannot really be a great point of principle between paying it in the week beginning 5 December, as under the previous Government, and paying it in the week beginning 7 December, as is proposed today.
  The hon. Member for Roxburgh and Berwickshire raised two points about the public expenditure White Paper on which I should like to help. The £108 million figure which he quoted covers paying the bonus to

  415
  retirement pensioners only; it does not include the additional sum for the other categories who receive it, including war widows, recipients of invalid care allowance and so on. The £100 million figure which he mentioned is because for future years the estimates are rounded to the nearest £100 million, so that is not a significant figure. We are expecting the number of beneficiaries to increase, so the sum of money will rise correspondingly. However, the figures for future years are calculated to the nearest £100 million.
  My hon. Friend the Member for Birmingham, Edgbaston (Dame J. Knight) treated the debate broadly and interestingly and set the £10 bonus in its context. For example, she mentioned the meals service. I am pleased to be able to tell her that the number of meals served has increased substantially since 1979, to nearly 43 million at a cost of £32 million.
  I take it that the hon. Member for Derby, South accepted my figures showing the increase in pensioners' living standards, but she said that that was all due to the introduction of SERPS. I must dispute that strongly, because it does not seem to hold water. The hon. Lady will know from her constituency experience that the contribution of SERPS to pensioners' living standards is, for the moment, small. She was resting her case upon the effect of SERPS on the occupational pension sector. Even so, it is early days for such an effect, if there has been one, to come through. She must face the fact that the increase has been largely due to the increase in the value of pensioners' savings as a direct result of the lower rate of inflation, which has been the big contrast between the period when she held office and the period since 1987.
  In a moment of tremendous candour, the hon. Lady said that the Christmas bonus had not been payable under Labour because the country was broke. She did not actually use that expression, but that was the general flavour of what she was saying. None the less, she seemed keen that we should have kept SERPS in a unreformed state, presumably to guarantee that by the year 2030 or 2050 the country would again be broke and unable to pay the bonuses.
  Mrs. Beckett: I am glad that the Minister made that point. He is quite right that, with not only candour but accuracy, I acknowledged that there were substantial economic problems when we last held power. Unfortunately, the remedy of North sea oil was not available to help us to tackle those problems—a remedy which has existed for 95 per cent. of the Government's tenure of office. Given all that has been said during the recent election campaign about how successful the economy now is, why have the Government not only not increased the Christmas bonus since 1979 but said—in his words in this debate—that they have no intention of doing so in the lifetime of this Parliament?
  Mr. Portillo: Britain's prosperity is based on much more than North sea oil. That is borne out by the fact that, since the value of North sea oil has fallen by half, Britain's prosperity has continued to grow. It is the increase in revenue from a variety of taxes, reflecting the better performance of the economy, that has enabled us to do so well and to increase the benefits paid to the elderly by 29 per cent. in real terms since we came to office. I was at some pains to explain in my opening remarks that the total condition of the elderly and their income and receipts is the
  416
  relevant factor, and we do not regard it as the best use of public money to increase the Christmas bonus. As far as I know, the hon. Lady is of the same opinion because the Labour party's manifesto contained no proposal to increase the Christmas bonus. I thought that we were in agreement on that, and I see some nodding of heads.
  Mr. Ian Gow: A few moments ago my hon. Friend reminded the House of something that the Labour party did not do in December 1976—it did not pay a Christmas bonus. But does my hon. Friend recall something which the Labour party did do in December 1976? Was it not on 15 December 1976 that the famous letter was written by the then Chancellor to Dr. Johannes Witteveen promising a continuing and substantial reduction in public expenditure, a promise which was forced——
  Mr. Deputy Speaker: Order. Be that as it may, is nothing to do with the order before the House.
  Mr. Portillo: I take it that my hon. Friend was simply speaking in support of the hon. Member for Derby, South in her point about the country being broke in 1976 and 1977.
  My hon. Friend the Member for Edgbaston made an interesting point, which is frequently made, about those just above supplementary benefit level who find that the sudden cut-offs are a disadvantage. I do not believe that the situation is exactly as my hon. Friend described. People can receive help for prescription and dental charges and for their spectacles even if they are not on supplementary benefit. In the new proposals for income support we have tackled the question of the capital disregard and my hon. Friend the Member for Edgbaston would approve of that. That reduces the cliff-edge distinction between one level of income and another.
  During the debate we have heard a certain amount about what the Labour party would have done if it had been in office. The most important contribution that the Government have made to helping pensioners has been our success in controlling inflation. It was therefore very sad and distressing, especially to elderly people, when last month the Labour party and the alliance went to the electorate offering nothing less than a return to the high inflation rates of the 1970s.
  Mr. Kirkwood: No.
  Mr. Portillo: The hon. Gentleman may protest, presumably because he remembers that the alliance was hard to pin down on that point. It Commissioned a report from Coopers and Lybrand on the effect of its economic policies, but that report conveniently ignored the effect on the rate of inflation. Fortunately, another respected City firm, Cazenove, informed the debate with its independent forecast of 12 per cent. inflation by 1990 as a result of alliance policies.
  The Labour party proved itself indifferent to the level of inflation. The Leader of the Opposition said on "Panorama" that there would be a "temporary surge" in inflation taking the rate up to "say, 7 per cent."
  Mr. Deputy Speaker: Order. This has nothing to do with the order before the House. I hope that the Minister will confine himself to the order.
  Mr. Portillo: I was trying to put the £10 bonus in the context of the cost of living which pensioners must face.

  417
  I remind the House that more than 70 per cent. of pensioners have an income from savings, while more than half have occupational pensions. Since 1979, the average value of pensioners' incomes from those savings has increased by more than half. Nothing in decades has done as much harm to pensioners as the inflationary surge that occurred under the previous Labour Government. Nothing is more important to the financial welfare of retired people than what the present Government have done to bring down inflation to its lowest level for 20 years. Against that background, and in that context, I commend the order to the House.
  Question put and agreed to.
  Resolved,
  That the draft Pensioners' Lump Sum Payments Order 1987, which was laid before this House on 7th July, be approved.

  SUPPLEMENTARY BENEFIT
  Resolved,
  That the draft Supplementary Benefit (Requirements and Resources) Amendment Regulations 1987, which were laid before this House on 9th July, be approved. — [Mr. Lennox-Boyd.]

  Hovercraft
  6.42 pm
  The Parliamentary Under-Secretary of State for Transport (Mr. Peter Bottomley): I beg to move,
  That the draft Hovercraft (Civil Liability) (Amendment) Order 1987, which was laid before this House on 9th July, be approved.
  I am sure that the House would like to know that I am a great expert on hovercraft. I travel on them, and most of my family seem to operate, service or own them.
  I trust that the order will be non-controversial. Its purpose is to increase the limit of liability for operators of hovercraft, as currently prescribed in the Hovercraft (Civil Liability) Order 1986, in respect of claims made against them arising from the death or personal injury of passengers carried by hovercraft. The hovercraft liability regime is somewhat different from that for ships. However, the maximum for passenger liability for death or personal injury is derived from the Athens convention. The draft order seeks to increase the present liability limit to £80,009, in line with the increase introduced on 1 June under the Athens convention for ships. In that respect, the order restores parity between the two types of transport.
  The terms of the Athens convention have been applied under United Kingdom law since 1977 and the convention entered into force internationally on 28 April this year. The tragic loss of the Herald of Free Enterprise on 6 March brought the convention into sharp focus. The Government subsequently announced their decision to use the right given in the Athens convention to increase the limit of death or injury liability for sea passengers carried by United Kingdom carriers to £80,009. As the House is aware, that increase came into effect on 1 June.
  It is appropriate that this revised limit should be extended to hovercraft to maintain the link with vessels. The draft order does no more and no less than that.
  6.44 pm
  Mr. Tony Lloyd: This will be a short, but important, debate. As the Minister has explained, we are still living very consciously with the memory of the disaster at Zeebrugge. While the order simply brings parity between hovercraft and shipping, and to that extent the Opposition do not disagree with the principle, it allows us to examine more generally the principles upon which compensation is based.
  Compensation is important for the victims and the relatives of victims of disasters whether involving hovercraft, ships or any other form of transportation. There is a fair degree of inconsistency at the moment between different forms of travel and the levels of compensation available. There is an issue of principle there.
  There is a wider-ranging issue which involves the reasons that lie behind imposing a limitation upon the liability of carriers. An argument can be put—and I will advance it—that levels of compensation for shipping or hovercraft are lower than is necessary or acceptable. We all recognise the need to drive for ever-increasing safety. Safety on hovercraft or on other forms of transport cannot be achieved simply by imposing financial liabilities on the carrier, although we accept that it is important that there should be an adequate number of marine surveyors. Indeed, the Opposition argue that we do not have enough

  419
  of them. It is also important that there is adequate trade union representation on hovercraft. That issue is in dispute at the moment between the National Union of Seamen and Sealink. The existence of some system of liability is important to ensure that financial penalties are imposed on carriers if they do not conform to acceptable safety standards. That is important as a means of reassuring the public, especially when a perception arises that recently profits may have been put before the lives and safety of passengers.
  We do not in any sense disagree with the view that compensation liability should exist. The difficulty lies in deciding what limits we should impose. The Athens convention, as I understand it — I am sure that the Minister will correct me if I am wrong—remains at the lower level of £38,000 with regard to foreign carriers transporting United Kingdom passengers in United Kingdom waters. The higher level of £80,000 has been introduced only for domestic carriers. At that level, we accept that we must approve of the principle that brings hovercraft into line with shipping. We agree with the Government there. However, the difficulty lies in deciding whether the limit of £80,000 is enough.
  In a debate in Standing Committee in March this year, the then Parliamentary Under-Secretary of State for Transport informed the Committee that he intended to go to the International Maritime Organisation and pursue a demand that the legal committee should examine and increase the limits on liabilities. Will the Minister tell us what happened at the June meeting of the IMO? It is important that we are told that adequate representations were made to increase the limits. If the Minister has the information, can he tell us how the United Kingdom compares with other countries in western Europe and the United States in terms of liability? Will he examine the question why we need to impose limitations at all? I accept that we have ratified the convention, that we are stuck with it, and that it states that we must impose the limits set out in the convention.
  More generally, in relation to compensation, if, for example, I were to walk out of the House and were run over by a motor car, I would have an opportunity to sue through the courts. It would then be for our courts to determine the level of compensation, not in an arbitrary fashion, but on the basis of the principles that govern compensation claims and damages. The court would examine the circumstances, needs and entitlements of the victim. In the long run, is that not the system that we ought to pursue?
  The position now is that, whatever level of compensation is laid down as a limit, it is open to challenge. Air travellers find themselves governed by international conventions and limited to a figure roughly the same as that for shipping—about £80,000. At least there is parity there. I can understand the logic of the £80,000 figure in bringing shipping and hovercraft to the same level as aircraft. However, in international conventions on rail travel, the limit on compensation is £56,108. It is totally separate and arbitrary. Under protocols for road traffic, the figure is £66,795, although the protocols are not yet in force. Again, those figures are literally plucked from the air.
  I hope that the Minister will accept my next point as a serious one. In the British courts we have recently seen an award of damages of £1·2 million to a young man who suffered injury and was able to sue those involved in the
  420
  medical profession. Whatever argument we advance about acceptable levels of compensation, the fact is that awards of £200,000 or £300,000 are not uncommon. The limit of £80,000 for compensation for those who are severely injured or for the dependants of those who are killed in accidents of the kind that might take place on hovercraft is punitive relative to the compensation that might be obtained through the British courts. There is a serious anomaly there and I should like to hear the Minister's views on whether we ought to pursue unlimited compensation under international conventions.
  I accept that as signatories to the present convention we are bound by the limits, but it is important to accept that we should pursue limits considerably higher than those that operate at the moment. The Opposition do not disagree with the Government about the limit to be applied to hovercraft. There is considerable sense in making sure that hovercraft are tied to the same protocols and limitations as apply to shipping. The argument is not that hovercraft should be treated as a special case, but that the whole area of levels of compensation is important for victims and dependants. As things stand, those levels are not high enough. I ask the Minister to place on record his own views on those issues.
  6.53 pm
  Mr. Peter Bottomley: I thank the hon. Member for Stretford (Mr. Lloyd) for his welcome of the draft order. He raised a number of issues, some of which I do not want to go into in detail. It is worth saying that international conventions generally lead to uniform regimes that have the effect of guaranteeing users and, in particular, employees standards of protection and compensation. They also give a degree of assurance to operators that the expenses and other difficulties that they have to meet in achieving those standards are also faced by competing ship owners or operators in other countries.
  Although I accept the common sense of the hon. Gentleman's points about unrestricted liability, having a restriction on liability makes it more likely that people will have the insurance cover required or will be able to face claims arising out of the sort of incidents that we witnessed recently in shipping and that we see occasionally in aviation. We have also seen such accidents involving hovercraft, but on very rare occasions.
  The point worth making about international comparisons is that we are the only country to classify hovercraft as a distinct type of vehicle. Most other countries using hovercraft classify them as ships, but in fact most other countries do not operate hovercraft. We have a slightly mixed regime for hovercraft because of the way in which we classify them. I am sure that if we were starting from scratch we might argue, as the hon. Gentleman suggested, for rather greater natural uniformity between different forms of transport. However, given the way that international conventions have grown over the years, the hon. Gentleman will understand that it is not necessarily the best return for effort to try to get all the people involved in the conventions for aircraft to come together with the people involved in the conventions for shipping and, perhaps, to try to get others who do not operate hovercraft to come in as well. Perhaps a greater return for effort comes from taking the opportunities that we have on domestic liability— the point that the hon. Gentleman was asking about.

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  The hon. Gentleman asked about the International Maritime Organisation. When my hon. Friend the Member for Worcestershire, South (Mr. Spicer), then Under-Secretary of State for Transport, announced the decision to increase the limit for United Kingdom carriers, we said that we intended to ask the International Maritime Organisation to undertake an urgent review of the Athens convention and the related 1976 convention on the limitation of liability for marine claims. The recent council meeting of the International Maritime Organisation responded immediately to our proposal, and it was supported by a number of other member states. The IMO has agreed to an early review of the Athens convention and related issues. That is welcome.
  On behalf of the House, I thank the hon. Gentleman for allowing us the chance of this short debate. Other issues go slightly wider than the order, but the House may be able to return to them. We are doing well in this instance by raising the limit of liability for travellers in the United Kingdom-operated hovercraft.
  Question put and agreed to.
  Resolved
  That the draft Hovercraft (Civil Liability) (Amendment) Order 1987, which was laid before this House on 9th July, be approved.

  Telecommunications Technology
  6.58 pm
  The Parliamentary Under-Secretary of State for Corporate and Consumer Affairs (Mr. Francis Maude): I beg to move,
  That this House takes note of European Community Document Nos. 5876/85, 5876/85 Add 1, and the Department of Trade and Industry's Supplementary Explanatory Memorandum of 30th September 1985, and No. 10277/86 on Community research and development in the field of telecommunications technologies (RACE); and supports Her Majesty's Government's intention to agree to the early adoption of Community legislation with a view to stimulating co-operation at Community level in the field of telecommunications technology.
  This debate is timely. I am pleased to be able to inform the House that today political agreement to the Community's five-year research and development framework programme has been reached on the terms proposed by the Prime Minister at the June European Council. I understand that the programme is likely to be adopted at the Budget Council tomorrow. RACE, which we are now debating, and, indeed, other major initiatives such as the second stage of ESPRIT, which are also part of the overall framework programme, are therefore set to move forward very soon. The reason for this debate is to enable the final decision on the main phase of RACE to be taken before the House reassembles.
  The full title of the RACE programme is research in advanced communications technologies in Europe. Its goal is a system communications link based on optical fibres for both home and office, and it can be used for broadcasting or communications, or, indeed, for both together. It would move us forward into the era, some time in the mid-1990s, when telecommunications and broad-casting technologies converge on a common delivery method.
  The programme was initiated by the Council of Ministers in 1984 as a key element of the Community's response to the worldwide technological revolution in telecommunications. It reflected a belief among all member states that action on long-term research and development in telecommunications at the Community level was needed if the industry was to be able to meet the challenges of the digital age in the 1990s and beyond and match competition from the USA and Japan.
  The research and development effort and the level of funding necessary to develop, and get into the market place, which is important, low-cost high quality equipment to meet telecommunications needs in Europe until the end of the century, given the growing complexity of technological options, are beyond the capacity of even the biggest national telecommunications equipment suppliers in Europe acting on their own. Moreover, it would clearly not make commercial sense for either network operators or equipment manufacturers to commit themselves on their own to such large investments in long-term projects, some of which, in the nature of things, will fail to produce a worthwhile return or, in some cases, any return at all.
  Therefore, RACE is directed towards pre-competitive research and development. Its aim is collaborative research through Europe in advanced telecommunication technologies to pave the way for the integrated digital telecommunications networks of the 1990s. The objective is to strengthen the Community's equipment manufacturers and network operators by encouraging them to

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  invest now in the research and development that will be vital to their future success in meeting world competition in this fast-moving area. Only with such investment now will operators be able to offer users in Europe the access that they will demand to advanced, but competitive, services. The availability of such advanced telecommunications technology and the assurance that Europe can keep pace with the rest of the world are crucial to European economies.
  RACE was set in motion by a decision of the Council in July 1985. Details were given in explanatory memoranda which were laid before the House. They explained that the aim of the RACE programme should comprise two phases. The first was the definition phase, to establish clear objectives and priorities. The second was the main phase, in which the R and D would actually be undertaken, and then evaluated in readiness for commercial applications.
  Mr. Paddy Ashdown: Will the Minister he kind enough to enlighten the House as to when that decision was first taken? What was the time scale, and what was the date at which it aimed to have phases 1 and 2 in operation?
  Mr. Maude: The aim was that the definition phase would last until the end of 1986, as it did, and that the main phase of RACE would start as soon as possible thereafter.
  Mr. Ashdown rose——
  Mr. Maude: If the hon. Gentleman will be patient I shall deal in due course with the aspect that I suspect he is about to raise. If I do not deal with it, I shall give way later.
  The first part of the main phase is scheduled to run from around the end of this year until 1992. The second part of the main phase will follow on.
  The definition phase began with analytical work, carried out mainly by the network operators in Europe, to formulate an outline specification for Community-wide integrated broad band communications, commonly known in the business as IBC. It would then be possible to explore the various options which would need to be pursued in depth to achieve the most cost-effective solutions and to identify the standards which would be necessary.
  IBC will enable subscribers throughout Europe to be supplied by means of a single connection with all available telecommunications services, for example, telephone, two-way video services such as the videophone, high definition television, and a variety of data services would become available. Particular emphasis is put on significantly reducing the cost of optronic components for the local loop to make it an economic proposition to transport the whole range of high-quality services along a single optical fibre channel to ordinary residential and small business customers.
  The definition phase work then went on to analyse and evaluate specific topics. This was done on a project basis. It drew on existing R and D, including the ESPRIT programme of research into information technology.
  Particular care was properly taken not to duplicate work already being carried out under ESPRIT. Participation in projects was open to all companies of whatever size, universities and research establishments.
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  The main criterion was that proposals had to be collaborative, involving at least two independent partners in member states.
  There was a strong response to the definition phase from European industry. Firm proposals were submitted by some 80 consortia, 32 contracts were eventually placed, and I am delighted to say that British companies were lead contractors in 14. There was a British presence in 26 and, of 192 participants in the various consortia, no fewer than 52 were British. British companies received more than 30 per cent. of the total Community support available for the definition phase. These excellent figures augur well for the involvement of British firms in the main phase and underline the importance which British industry attaches to the European R and D programmes such as RACE. The outcome of the definition phase was extremely positive. It clearly confirmed that there was scope for Europe-wide IBC on a commercial basis, and that a significant Community effort to prepare for it was, therefore, justified.
  That brings us to the main phase of RACE. Proposals for this have been before the Council since last year, and the original intention was a five-year programme to begin on 1 January 1987. For various reasons, including lengthy debate within the Community on the R and D framework programme, the programme, which was optimistic from the beginning, could not be met.
  Much has been done in the intervening period. We have pressed for, and obtained, improvements in the structure, priorities and cost-effectiveness of the programme. We have removed from it less necessary or duplicative work in order to ensure that the money is well spent. There have been added, largely at our insistence, verifiable objectives and a procedure for the independent evaluation of projects, both of which are crucial to ensure value for money. Even if the main phase had been adopted by the Council last January, that work would still have been necessary before the programme could begin. There is absolutely no point in spending money just for the sake of it. We must ensure in projects such as this that the money is properly directed and well spent.
  Mr. Ashdown: My point is crucial, as I am sure the Minister will understand. Is not the reality — the Minister has hinted at it coyly—as I shall explain in a moment, that RACE is one or two years behind its schedule in a highly competitive area in which others are moving fast? The Minister has failed to say that the British Government have been responsible for that delay. Perhaps he will explain why. In the light of that fact, for fact it is, will the Minister also explain how the Government felt able to say in their motion that they are in favour of the early adoption of the Community legislation, when they have been the instrument of its delay?
  Mr. Maude: I am sorry that the hon. Gentleman has sought to introduce a combative note into a debate on a subject on which there has generally been agreement. I shall spell out to him again, as I have done previously, —it is for other hon. Members to judge whether I did so coyly—that the work that has been going on between 1 January and now would have had to take place in any event, irrespective of when the programme started. I am not sure whether the hon. Gentleman is suggesting that we should have gone headlong into the main phase of the programme without building into the system proper evaluation to ensure that value for money was obtained.
  Mr. Ashdown: How much delay?
  Mr. Maude: I have told the hon. Gentleman twice that there is no delay because the work would have been essential before the projects could have got under way. I am sure he will understand that it follows clearly from that that there is no delay.
  The main phase will be divided into three parts. The first concerns the development of IBC and strategies for its implementation. There will be work on the development of functional specifications, the definition of proposals for IBC standards and to establish interoperability for IBC equipment and services. It is envisaged that much of this work will be funded by the European network operators, who have a strong interest in a successful outcome. British Telecom is very much at the forefront of European work in this area.
  The second part is the research phase proper and is aimed at the development of IBC technologies. It will entail co-operation between enterprises in different member states of the Community and, exceptionally, enterprises in other Western European countries. This is the biggest part of the RACE programme and will be carried out under shared-cost contracts with the contractors jointly bearing at least one half of the total expenditure and the Community providing the remainder. There is a real opportunity here for European industry to achieve the economies of scale that will enable it to compete both within Europe and in wider international markets.
  Dr. Jeremy Bray: The Minister referred to the industry's contribution being "at least one half." Is he suggesting that the Government have given up their proposal that industry should contribute three quarters?
  Mr. Maude: I understand that the proposal for the main RACE phase is clearly that the Community will provide one half of the cost of the project. Therefore, industry must provide at least one half. Although in certain circumstances it may provide more, that will not necessarily be a requirement.
  The third part of the main phase will consist of co-operation between member states to assess operational concepts and experimental equipment, with the objective of validating specifications and proposals for standardisation arising from the work in the earlier parts of RACE. This plainly lies a few years ahead.
  I should finally say a word about finance. The Commission's original proposal envisaged that the Community's total expenditure on the RACE main phase would be 800 million ecu, or about £560 million. During extensive negotiations in Brussels, in which we played a prominent part, this figure has been substantially reduced as the programme has been refined to cut out duplication and unnecessary work. [Interruption]. I hear the hon. Member for Yeovil (Mr. Ashdown) sniggering to himself in a contemplative sort of way. I am not sure whether that means that he would have preferred a programme that included duplication and unnecessary work. There is no point in spending money for the sake of it. It must be spent to achieve a purpose. Our work and the prominent part that we have played in the negotiations were directed to ensure that that happened and that money was not simply poured down the drain for the sake of it.
  Mr. Ashdown: The money was reduced.
  Mr. Maude: It was ensured that the money spent was on work that had value, and that is what is important.
  The final figure is now likely to be about 500 million ecu. The Government believe that this will enable the programme fully to meet its objectives, but the objectives must be kept under constant review, and the Community's legal instrument has built into it provision for annual reviews to evaluate the work done and to consider whether work on particular aspects of the programme needs to be continued. The Government will be vigilant in ensuring that the funding for RACE is spent effectively and that there is full and proper evaluation and re-evaluation of objectives.
  British firms which did so well in the definition phase are keen to grasp the opportunities which the much larger main phase offers. I am confident that British enterprises will win a worthy number of contracts and that this will prove of great importance to them in the long term as the European market develops. I am also confident that RACE will prove to be an effective European response to the technological challenge in this key sector of telecommunications and I warmly commend the motion to the House.
  7.11 pm
  Dr. Jeremy Bray: I was glad to see the Parliamentary Under-Secretary of State opening the debate, but it drove me to look at the list of ministerial responsibilities and to ponder on the reasons for the absence of his colleague the hon. Member for Coventry, South-West (Mr. Butcher), who is listed as having responsibility for this area. We are used to having a tremendous turnover of those with responsibility for industry in the present Government and later I hope that the hon. Gentleman will say whether his arrival on this scene, which is welcome, is permanent or fleeting.
  The news that agreement has been reached on the framework programme is important and I hope that it will be ratified at the budget meeting tomorrow. It is long overdue. The general feeling in industry and the research world is that the delays in reaching agreement on the framework programme, for which the Government have been largely responsible, have been substantially damaging because many depositions depend on the particular arrangements made in RACE.
  Relations between European and United Kingdom programmes are most important. Last week at the review meeting of the Alvey programme the Chancellor of the Duchy of Lancaster was extremely bearish about the prospects of Government support up to the levels proposed in the IT86 report. The practical effect of that has been to switch the priorities for and preparation of research proposals heavily from the United Kingdom scene into ESPRIT. That is good in so far as there will be strong British participation in the ESPRIT programmes and no doubt some Ministers will boast about this in future, but the work will be undersupported on the United Kingdom side in terms of the matching research necessary within a purely United Kingdom context.
  That confusion between the balance of British and European work has been a casualty of the delays. It has not been helped by the fact that, although industry has been strongly supportive of RACE and feels that it has been a useful European initiative, the Government have not made it entirely clear that their misgivings about the management of the research in Europe have related not so

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  much to the RACE or ESPRIT projects as to the joint research centres and the stops needed to tighten management there. It would be much better if the Government would more frequently in the House, and certainly elsewhere, make it clear what their considerations are. To make the research budget of the whole of the framework programme a pawn in the general argument about European Community finance is to take our industrial future far too lightly.
  The European Commission has now sent out a call for expression of interest in RACE to be received by 4 October. These will be considered and the awards made in time for work to start early in the new year. Perhaps the Minister would confirm that timetable.
  The papers referred to in the motion are rather old. One more recent paper is relevant to considerations in this area —the Green Paper on the development of the Common Market for telecommunications, services and equipment, published on 30 June, but to which no explanatory memorandum has yet been attached. It is Com(87)290 for hon. Members who may wish to look it up when reading Hansard.
  The framework programme speaks of telecommunications as the lifeblood of the large market. In its range of applications, in the rate of technological change, in the social consequences and in the volumes of economic activity at stake that is certainly true. The RACE programme states:
  "It has been estimated that during the next decade about 500 billion ecu … (corresponding to 500,000 jobs in average) will be invested in the Community in telecommunication infrastructures, services and terminal equipment and in the next 20 years three times as much … More importantly, however, it is estimated that for those leading in offering advanced information services the employment benefit may be 10 times as large. For Europe's employment prospects the creation of favourable conditions for new and enhanced services is the most significant employment aspect of advanced telecommunications services. Based on these estimates the overall employment at stake may be as high as 5 million by 1990."
  That was written in 1986 and the time scale may be a little optimistic. The order of magnitude seems much more firmly based. We are talking about 5 million jobs in Europe if we make a success of this compared with only about 500,000 if we make a mess of it. In terms of employment in the United Kingdom it would be the difference between 1 million more jobs and only 100,000. Therefore, the stakes for being at the forefront of offering advanced information services are high.
  In order to pull that off, we need to succeed in RACE and to see the programme, first, in the context of the regulatory regime in which the results of that technology will be exploited and, secondly, in the development of applications which will provide an economic justification for the technological developments. Those are most important considerations. In so far as the Government have run into rough water in the management of RACE, they are open to much more serious criticism on the question of the regulatory regime and the effort put into application development.
  I shall follow the Minister in considering the lessons from the RACE definition phase. The committee of management concluded that the integration needed is integration for freedom of access. That is a useful concept. It is not an exlusive or monolithic integration. If one goes into the system in any one place, one may have access to any other place but one wants to go in freely anywhere.
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  The physical integration is less important than coherent and compatible network operation, with efficient, dynamic use of the overall transmission capacity. That is important also in that it brings the idea of IBC—integrated broad band communications — much more into the present era, with the early prospect of direct broadcasting by satellite and the even earlier prospect of the full exploitation of the substantial digital capacity of the twisted pair of our present telephone system. The data transmission side is capable of much fuller exploitation than it now receives.
  The third lesson drawn from the definition phase is the importance of OSI — open system interconnection standardisation. That, too, can hardly be exaggerated. It is most important that the very useful lead established by this country—which Europe is building up—in terms of the impact on American and Japanese standards, and the influence on their equipment design, should be maintained.
  The economies of scale have been fully borne out, and certainly on the human side it has now been well established that research teams can work happily across national frontiers. As for the financial side, the Under-Secretary may feel that the sums in Europe are large. On a European scale, they may even be diseconomies in co-operative research. However, the cost of our having to do all that alone in the United Kingdom would be absolutely out of the question.
  Again, economies of scale in production are such that we shall probably have to move very soon into much fuller consideration of the question of industrial structure in this country. If in the United States the principal semi-conductor manufacturers conclude that they can operate economically only if between them they build a single silicon foundry, how much more true is that of the United Kingdom — or, indeed, of Europe? Ian Mackintosh's book "Sunrise Europe" shows that there is probably scope for only two European designers of a wide band switch, which effectively means only to major prime telecom contractors in Europe. Where does that leave us in terms of United Kingdom industrial policy and the issues raised about the future of GEC and Plessey?
  A further lesson was that broad band can greatly improve the cost performance in handling the narrow and medium band services. If we want a higher quality telephone service or an efficient electronic funds transfer from points of sale linking banks, shops, homes and so on, it is far more efficient to do that within a broad band service than simply to try to pile on separate narrow band links. There is the potential for enhancing the traditional carriers; there is also the importance of an evolutionary approach that builds on the systems that we have and deepens the applications. However, perhaps the most important lesson is that there are grave uncertainties in integrated broad band communications about cost performance and user acceptance of the services that it will be possible to provide.
  If those are the lessons, the work plan anticipated in RACE and set out in the proposal document seems a bit limited. The material seems to confine itself too narrowly to the technology. Emphasis is rightly placed on the importance of the reference models, the description of the typical consumer and of the typical local switch, and so on. The systems analysis and specification are obviously essential, as are implementation and planning and the

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  development of the enabling technologies. The Under-Secretary referred to fibre optics and opto-electronics. The very important software side of the huge programmes that will have to be written to handle the wide-band switches, the user technologies, the sub-systems, the customer facilities, user access, network functions and trunk exchanges for transmission are all essential. But where is the consideration of the market?
  Let us start with regulation. The Government's view is that the market can be left to look after itself. The experience in Japan with the integrated network system, which is held up to us as a tremendous threat and bogey that we must meet, has been severely restricted in its pace of development by the reluctance of consumers in Japan to go digital. There is a big increase in telecoms traffic in Japan, but the bulk of it is simply facsimile transmission, with well over half the total facsimile transmission in the world taking place between one office in Japan and another.
  There is considerable consumer resistance to the keyboard and to the absorption of digital systems. We can put that down in this country to the particular script that the Japanese use, but I think that that would underrate the nature of the problems that we face in the market place. What are the dangers if we fail to put adequate work into the development of the market? One of the dangers is that we shall do all the donkey work in the creation of the communications infrastructure, and overseas suppliers will be able to come in with whatever is the equivalent 10 years from now of the computer game, the personal computer or high-definition television and swamp the markets in the United Kingdom and in Europe. There simply is not a market for IBC. It will have to be created, and special steps are needed to create it.
  The Green Paper is an important element of that scene. The application development, about which the Government have not yet talked, must be another. The Green Paper makes some proposals in its figure 3. Those proposals are broadly acceptable to Opposition Members. They aim to combine the integrity of the system with the financial viability of the prime network operator, along with a competitive regime of value-added services. Are those principles acceptable to the Government? Is the financial integrity of the prime system operator to be met only by sacrificing the quality of services? That is a threat about which we have heard much from British Telecom customers and in the House in recent days. Do the Government offer a commercially viable path of development for the recabling of Britain? Is the apparatus of the Cable Authority licensing local cable networks going to proceed at anything like a fast enough pace to exploit the opportunities that RACE will open up for us?
  The present indications are that the cable operators are just waiting until 1990, when they hope to be given freedom to provide voice telephone services on local cable networks. If that is used as a means of destroying the integrity of the necessary national network, the Government will have destroyed the possibility of our exploiting the opportunities that we are opening up in the RACE programme.
  It is not good enough to wait until 1990 and then leave it to Oftel to review the provision of telephone services. The Green Paper that deals with the exclusive provision
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  of special rights for telecommunication administrations regarding the provision and operation of the network infrastructure says:
  "Where a member state chooses a more liberal régime either for the whole or for part of the network, the short and long term integrity of the general network infrastructure should be safeguarded."
  It is not good enough for the United Kingdom to be the only country in Europe that is going down this route. If we wait until 1990, the inevitable conclusion of Oftel will be that we do not have the evidence or even the basis for the right decision, because steps should have been taken much earlier to develop and explore the market possibilities.
  Within the European Commission there is, according to one of its appalling acronyms, SOG-T in GAP. That is the sub-group of the senior official group for telecommunications in the group d'analyse et prévision, which I believe is an analysis and forecasting group. I do not know who those officials are, but I am told that they come from the Department of Trade and Industry. I question whether that group has the necessary background to tackle the huge application and development problems that need to be faced.
  I shall give three examples. First, there are two large organisations for medical records. One has the unfortunate name of VAMP. It provides computers free to general practitioners in return for information on patient prescriptions. Already it has on record the prescription records of 500,000 patients. Within a year it expects to have 5 million prescription records. One sees why that is a valuable market research tool for the pharmaceutical companies, but it is a monstrously inefficient and potentially dangerous way of handling medical information for research purposes. Should there not be a much firmer grasping of nettles to make sure that the tremendous possibilities that are opening up in health care by the use of telecommunications are properly developed, in the fullest interests of the patient and in the light of the best medical practice?
  Secondly, the Dutch Government recently published the report of a committee, under Walter Zegfeld, on the potential market for wide band communications in the Netherlands. It concluded that if we make all the allowance in the world for tele-shopping, on-course transmission to betting shops, electronic funds transference from the point of sale, and so on, the growth of such markets is unlikely to make integrated broad band communications commercially viable. The committee anticipates that the main growth of applications will be, curiously enough, first in health care and then in education. That surprises me a little, but the Dutch may be a nation of hypochondriacs. However, its educational applications do not surprise me.
  If one visits the Inter Active Video Centre near Euston, which is supported in part by the Department of Trade and Industry, one sees there a brave, struggling, but hopelessly underfunded, effort to explore the potential of RACE technology in education. There is concern about the quality of education. There is readiness to put effort into curriculum development. There is also readiness to look at innovation, in terms of the responsibilities and the funding of schools.
  If schools were offered £1 billion to put themselves on line in a wide band cable system, they would say, "No, thank you. We have greater priorities than that." If,

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  however, we found that by developing these services we could open up the possibility of very much wider use of wide band information services in society as a whole, it is perfectly conceivable that the education system would get the wide band cable service free. That would stand on its head this Government's strategy. They think that value added services can come on the back of entertainment and the proliferation of local cable networks. They may be wrong. We may first need to develop the educational applications by the delivery of well-organised, first-class curriculum material to schools, after which the other markets might grow in this country.
  Thirdly, in preparation for the big bang, the City invested a great deal of money and hardware in very simple operations, such as transferring the price of particular stocks, shares and currencies from one bank to another or from one part of the world to another. The main service is provided by Reuters, but the sophistication of the subsequent processing of that information for dealers is minimal. If Reuters is asked why it does not do something with the information, it says, "What benefit would it provide?" The obvious answer of economists is that it would help to stabilise the markets. "In that case," says Reuters, "we're agin it, because we make our money out of the instability of markets." Do the Government want to make their money out of the instability of markets? Would they not prefer a more stable exchange rate regime? Such questions are out of the depth of the DTI officials who sit on SOG-T in GAP. That is a woefully inadequate way of developing an applications philosophy.
  The tremendous talent and ingenuity of people in this country could be fruitfully employed in the development of wide band services and facilities, but crucial decisions will have to be taken during the lifetime of this Government. That is a sobering thought for the Opposition. Industry should be assured that a stable regime will be maintained for the necessary long-term developments and programmes and for the investment that needs to be made in the infrastructure and in wide band applications. We are ready to explore with the Government the differences between the two sides of the House that relate to the principles on which wide band will be developed in this country. Those differences of emphasis are not unbridgeable.
  Mrs. Gwyneth Dunwoody: I have followed my hon. Friend's speech with great care, but many of my colleagues and I are concerned about the fact that this Government appear to have no overall policy for information technology or for the use of satellites for broadcasting. Does my hon. Friend agree that if the French Government can issue hardware to vast numbers of small business men to expand information technology, this Government should come forward with a much more precise plan?
  Dr. Bray: I agree with my hon. Friend. The problem is that the major dispositions will be made in the next five years. With the prospect of coming into power at the end of those five years, we have to think about how the industry can be given a reasonable assurance of continuity to make possible long-term developments. I think that my hon. Friend will agree that some of us on both sides of the House think that those integrated services are possible, if only we can get ourselves properly organised.
  That overall view requires a consideration of the regulatory regime, and certainly the broadcasting
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  considerations in which my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) takes such a great interest. The matters to be considered include the research programme with which we are dealing. We shall need continuing and wide consultation with the researchers, the industry, the broadcasting authorities, the telecommunication authorities, British Telecom and Oftel. We are certainly prepared to take part in such consultations to ensure that there is the strongest possible national agreement about the overall regime in which the industry and applications developers can get on with the work.
  Meanwhile, the Labour party is glad to confirm its full commitment to the RACE programme and to wish it every success. We encourage the British partners to participate in it to the fullest extent so that we can benefit from it fully.
  7.31 pm
  Mr. Richard Page: The House will be delighted to hear that I do not intend to speak for very long or to follow the hon. Member for Motherwell, South (Dr. Bray) by going through all the aspects of the programme and endeavouring to double-guess it. I welcome the news that the programme is to go ahead, because it represents our only way of being in with a chance to match the billions of dollars put into the technology by the Japanese and the Germans. This represents only one aspect of European co-operation in which I believe we need to develop our contacts. As manufacturing technologies expand, we shall need more and more co-operation in Europe if we are to supply products at the right price to reach the gradually expanding markets of the world.
  I do not welcome the delay; I believe that the main phase should have started on 1 January, although I do not take the hysterical view of the hon. Member for Yeovil (Mr. Ashdown). While the delay is unwelcome, it will have been vital if it results in all the parties in Europe adopting common standards, aims, and evaluations. Let me produce a poor parallel: we need to get everyone to agree to drive on the same side of the road before we start making motor cars and rushing down it in them. If the delay results in the establishment of common standards in optical communications equipment, the time will have been well spent.
  To get anywhere near producing the components at prices that will stand a chance of survival in the world market, we shall need this common research. In turn, we shall be faced with increasing amalgamations between British and European companies. There will be thorny problems ahead when British and European companies face amalgamations with or takeovers by the American and Japanese companies endeavouring to buy the technology that has been accumulated. We shall have to examine that problem carefully when the companies come under threat.
  I welcome the measure, because it represents a chance—probably our only chance — of surviving the competition. I conclude by asking my hon. Friend the Minister and his Department to press on—and press on very quickly — so that the telecommunications equipment industry in Great Britain and Europe has a chance for the future.
  7.34 pm
  Mr. Paddy Ashdown: I was glad to hear the hon. Member for Hertfordshire, South-West (Mr. Page)

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  say that he believed that the programme was important because it would help us to match the enormous funds being poured in by the Japanese and the United States. I agree with him. However, one must ask oneself how that aim is to be fulfilled if the Government reduce the funds available to us. That will inhibit the very activities that the hon. Gentleman seeks to encourage.
  I welcome the Under-Secretary of State for Corporate and Consumer Affairs to his post. He is a welcome addition to the Front Bench. However, as the hon. Member for Motherwell, South (Dr. Bray) said, it is interesting to note that the Minister responsible for these matters is not here. It was noted that he was not present at the Alvey conference—at least at the beginning of it. Perhaps the Government's neglect of new technologies is now to be increased — or at best will continue. That neglect, in the past and the future, is very sad. Nevertheless, I congratulate the hon. Gentleman on his elevation to the Dispatch Box. He has learnt the slippery arts of Ministers and their way with weasel words extremely quickly.
  Mrs. Dunwoody: It is inherent.
  Mr. Ashdown: As the hon. Lady says, perhaps it is inherent. It appears that, as soon as an hon. Member arrives on the Front Bench, those gifts are showered upon him.
  When I asked the hon. Gentleman the reason for the delay, he said, "What delay? There is no delay." The programme was due to start in January this year. It will not be starting for 18 months or two years, but the Minister says that that cannot be described as a delay. He did not say what it could be described as, and I shall happily give way if he can find another suitable word from the armoury with which he has been equipped as a Minister of the Crown.
  Mr. Maude: If the hon. Gentleman compliments me too much, he will damage my career. I made the point that the work on getting the research and development under way, which is what we are concerned with here, will not be delayed. The fact that no formal decision could be made before a certain time because a number of countries wished to debate the matter further does not mean that the work has been delayed. As I explained, all the work and all the activities of the intervening period would have had to be undertaken even if RACE main phase had been decided on 1 January, which it could not have been.
  Mr. Ashdown: I shall return to that point in a minute because there are different views on it. Whatever the Minister says to the contrary, the start of the programme planned for this year has been delayed. The Minister has given his reasons for that. He said that a number of countries were involved. Let us call a spade a spade: the programme has been delayed, for whatever reason. I presume that it does not hurt the Minister to accept that. We now need to establish the reasons why.
  The resolution says that the Government are in favour of the early introduction of Community legislation. I have been looking into the Government's record on the early adoption of Community legislation. I do not need to use my own judgments on that. I shall take an independent judgment such as that of the Financial Times or The Independent.
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  An article in the Financial Times of 5 June 1985 said that the European nations had overcome the objections towards launching the framework programme within which RACE sits but stopped short of giving a formal blessing. A few days later, that appeared to be an optimistic judgment, because the programme had not got off the ground. It had not got off the ground because the United Kingdom Government—not the Governments of other nations as the Minister would so obligingly have us believe—had put up a block to further development of the programme. By the end of 1986, the RACE project had run out of money and was held up—no doubt, the reason for the delay.
  Mr. Page: I thank the hon. Gentleman for giving way. I accept that there has been a delay, but I hope that I made the reasons for it clear. I respectfully suggest that the hon. Gentleman cannot put the reason for the delay solely on the United Kingdom's doorstep. Germany and France were equally to blame while the negotiations were taking place. The hon. Gentleman is flogging a dead horse if he tries to blame the United Kingdom Government in such a matter. There must be agreement, especially between the two main partners, because there is no point in having a haphazard research programme.
  Mr. Ashdown: Those are not my words—they are the words of the Financial Times. [Interruption.] The comments of the Financial Times should at least be paid a little more than the scant respect that the hon. Gentleman has paid them, especially as that newspaper is not well known for accepting Opposition views.
  Mr. Michael Jack: I remind the hon. Gentleman of the final paragraph of the quotation from the Financial Times, which says :
  "The hiccup on final agreement came when it emerged that France could not approve another part of the combined package".
  I believe that that supports the point made by my hon. Friend the Member for Hertfordshire, South-West (Mr. Page).
  Mr. Ashdown: The hon. Gentleman has been careful not to give the date of the article. I do not believe that he was referring to the article of 5 June 1985.
  Mr. Jack: I was.
  Mr. Ashdown: Then let us look a little further. I do not deny that at various times certain other European nations have been prepared to join us, but the one nation that has been constantly holding this project up has been the United Kingdom. If France was with us in 1985, it had resolved the position by 1986. By the early part of 1986, the West Germans had joined us.
  On 9 April 1987, the Financial Times reported that the United Kingdom alone
  "needs more time to consider".
  I quote verbatim from the article of 9 April 1987. The statement is clear and accurate:
  "All this has exposed Britain to a chorus of complaints from the Commission, the European Parliament, industry lobbies and other member states".
  On 22 April 1987, The Independent ran this headline:
  "Britain maintains block on European Research scheme".
  On 21 May 1987, the New Scientist said that the scheme was
  "being held up largely because Britain refuses".
  On 24 June, the Financial Times said that Britain at this stage was

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  "close to a final decision".
  We understand that, by 10 July, there had been a turnround. The Financial Times of 10 July said:
  "the ambassadors have failed to resolve the deadline"—
  Conservative Members might like to note—
  "between Britain and the rest".
  Contrary to the motion's words, the United Kingdom Government have been constantly holding up progress towards the institution of this programme.
  Mr. Page: Will the hon. Gentleman give way?
  Mr. Ashdown: All right.
  Mr. Page: I again thank the hon. Gentleman for the courteous way in which he has given way to my few humble inquiries. I hope that he will accept the words of the European Parliament's rapporteur on the RACE programme. I believe that he contacted quite a few hon. Members. He said that, until April, France, Germany and the United Kingdom had been holding up the programme and that from April until 14 July only Britain had held it up. That is the position accurately.
  Mr. Ashdown: The hon. Gentleman has made his point in a different way. Of course, from time to time, other nations have joined us, but the constant barrier to the development of this programme and the framework programme has been the United Kingdom Government. In the light of that incontrovertible series of facts, it is strange, and an example of newspeak of the first order, that the Government claim to commend themselves for the early adoption of Community legislation.
  The Minister said that this was all about getting "better value for money". We have heard that expression used all too frequently as cover for the fact that the Government of the day wanted to reduce the amount of money to be put into a programme. That is exactly what has happened on this occasion. This move may well have been conducted under the cover of seeking better value for money, but the truth is that the amount of money which we were prepared to see committed to this great programme was reduced.
  Why was the amount reduced? Is there any logic for that? No, because Europe's position on telecommunications is good. This is one of the remaining aspects of new technology in which we can claim to have at least parity with the best in the world. Indeed, in certain respects, we are ahead of the rest of the world. This is a real opportunity to develop something that Europe has been good at and could be good at in future. It is an opportunity to be competitive. That is what is at stake and is being threatened and delayed.
  Is there any need for these measures? Yes. The latest figures for 1984 show that, despite the protection of Europe's position, and indeed what was uniquely Britain's position, there has been a massive deficit in the importation of telecommunications goods into Europe. In 1984, United States telecommunications imports into Europe were worth $565 million, whereas European exports, despite a healthy industry, were worth $307 million, giving a deficit to the United States alone of $258 million. The position was even worse in respect of Japan, with imports worth $134 million and the imbalance rated at about 1 to 34 in its favour.
  Is it the case that Britain was not going to benefit from this programme? Certainly not. Britain has benefited significantly from the investments that the Government were prepared to make. For every £18 that Britain is
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  prepared to put into EC research and development, it gets £22 back — a net profit of £4 from this type of development. This is happening in the face of a research budget which has been cut appallingly.
  Research in Britain is seriously threatened in the long term. What the EC has been doing for British research has been beneficial not only to Europe but to Britain. It has been enormously to our advantage not only in pure monetary terms—which, as we all know, is the way in which the Government judge these matters — but in terms of what British firms are doing. With this programme alone, a significant proportion of work has come to some of Britain's foremost firms. A number of outside commentators have said that Britain holds a lead in pressing forward developments in telecommunications and common systems such as RACE. We could do even better.
  Mr. Jack indicated assent.
  Mr. Ashdown: I see the hon. Gentleman nodding. He is right.
  The British firms include those that one would expect to be involved, such as GEC, Plessey, STC, Thorn EMI, British Telecom, and firms that one would not expect to be involved, such as the BBC, the IBA, MARI and Pilkington, which have gained a significant amount of work from this programme. But the Government have been the chief instrument in reducing the amount of money going into the programme. University college, London, the university of Strathclyde, Imperial Software Technology and so on have been involved. Meanwhile, other firms have had parallel technologies and developments from which they too have benefited. Developing test systems for communications standards has been the work of bodies such as ICL, Olivetti and BAe.
  In short, the United Kingdom has a lead and could have benefited enormously from a more progressive Government view. Instead, in this matter as in so much else, we have a Government who know the cost of everything and the value of nothing. If they had invested a little more progressively, we could have got this programme off the ground in a way that would have benefited Europe and at least ensured that we kept pace with the competition. It would have returned to Britain a direct benefit in economic costs, monetary terms, jobs and opportunities for the future.
  According to the rhetoric of the Government, that appears to be what they would have liked to do. The former Minister for Information Technology, the hon. Member for Chertsey and Walton (Mr. Pattie), spoke at the Esprit conference in Brussels on 1 October 1986. He said:
  "I have no doubt that our success in the industrial exploitation of information technology is a basic requirement for achieving more competitive European industries."
  That is correct, but it is a pity that he did not follow those words with some action.
  On 1 July 1986, the Minister spoke to British companies. He said:
  "I do not regard support for international collaboration as a substitute for supporting research and development at home."
  As we know, research and development in Britain has been cut and damaged. Its future has been put in jeopardy. Research and development in Britain is now facing a crisis on a broader scale. This is at a time when the Government gave away £3 billion in the Budget. The research and

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  development that was being carried out by the research councils in Britain was brought to a grinding halt due to the lack of about £9 million to £18 million. A thousand scientists a year are leaving Britain's shores because the opportunities for research in this country are not as good as those elsewhere.
  The Government are removing resources from universities. One wonders whether the Government have a policy on information technologies, other than one that ensures that in the long run those technologies will continue to decline. British high technology industry is growing at a rate which is half that of the world average. In the future we will face a massive balance of payments crisis in new technologies due to the narrow-minded, mean-spirited attitude that the Government have so clearly displayed.
  We had another example of that attitude very recently. The National Economic Development Office unit which was dealing with information technology has been abolished. Some Neddies have been retained. It is interesting to note that the Neddy that deals with knitting has been retained, yet the one that deals with information technology has been abolished. Perhaps that is a reasonable comment on how the Government see the future of Britain. They do not need assistance with information technology, but they will keep the knitting committee going. Britain is allowed to knit in the future, but it cannot develop a decent high-technology industry.
  Mrs. Dunwoody: I am sure that the hon. Gentleman would not want to underplay the role of knitting. Whether it is done by hand or machine, it is an industry which in the past has earned us a great deal of money. It would be sad if we lost those skills under this Government, which is likely to happen.
  Mr. Ashdown: I am sure that the hon. Lady would agree that, although the maintenance of an ancient industry such as knitting is important, British industry must begin to develop new technologies for the future so that they can be applied to traditional industries, including knitting and textiles. The extent to which that happenss depends on the Government's attitude.
  The shame and sadness of this matter is that the commodity for the future development of our industry is not any particular piece of hardware or raw material but information. That is what will make our industries of the future run. Just as our Victorian forebears laid down an infrastructure that was capable of transporting coal, steel and iron around the country for their industries and jobs, so in future we will need to lay down a modern infrastructure for the transportation of information. That is a key requirement and it is where the opportunity presented by RACE is so important. We are on the verge of a massive breakthrough in industry and society.
  Two things are now technically possible. It is technically possible for the Government to know everything about everybody all the time; it costs a lot of money, but it is technically possible. It is technically possible for the Government to deliver to every house in the nation — the French have made a commitment in this regard — all the information that is known in the world.
  There are two completely opposite directions in which to go, but there is a massive difference in the sort of society
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  that we would achieve, depending on which of those routes we follow. We are currently following the first of those routes. That is not unnatural for a Government who believe in centralising everything. We have 53 million names on the DHSS central computer and we have about 30 million names on the Inland Revenue computers——
  Mrs. Dunwoody: They cannot find most of them.
  Mr. Ashdown: That may be true—[Interruption.]
  Mr. John Mark Taylor: What about the membership of the Liberal party?
  Mr. Ashdown: If the hon. Gentleman wishes to intervene I shall happily give way to him, or is he maintaining his usual practice of intervening from a sedentary position?
  Mr. Taylor: What about the merger?
  Mr. Ashdown: The hon. Gentleman should observe the convention of not intervening from a sedentary position.
  The population of this country are on national data banks that are in the hands of the Government.
  There is an alternative route. Some Governments, notably the French, as the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) said earlier, are following a progressive policy and making a commitment to deliver a decent, national broad-band computer communication network which is capable of reaching every house. Would it not be better if we had that not only on a national scale but also on a European scale?
  The hon. Member for Motherwell, South has done some research into that matter and he tells me that such a computer communications network in Britain would cost £6 billion. I am told that that is about 50 per cent. more than British Telecom intends to invest, but what a national investment that would be. Would that not turn round our industry in the future? Would it not offer new opportunities for enterprise? Would it not generate the sort of jobs that the hon. Member for Motherwell, South mentioned?
  It would not end with industry, for it would revolutionise the nature of our society. It would give breath and new life to our democratic systems. It would give the opportunities to deliver education into every home and create a totally decentralised and more responsive network for our welfare and health systems. It would revolutionise the nation in which we live and the nature of our society. We would move to becoming a modern nation that is capable of facing the demands of the future.
  I strongly suspect that the post-industrial democracies that will survive and prosper will be those that are capable, able and brave and imaginative enough to make that investment. That is why the RACE project is so important. It offers an opportunity to achieve that, not just for Britain but for a European network. For the Government to have treated this project in the narrow-spirited, mean-minded way that they have by delaying, cutting and holding it up wherever possible is an act of folly not only for the future of our industry but for the development of our future society.
  I plead with the Minister and his Government: here is an opportunity that should not be missed. The Government have held back the project and reduced the funding that has gone into it, but they should grab the opportunity that is available. If they do so it could set Britain and Europe on a path to the kind of society that

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  could establish the basis for a modern industrial system that is capable of challenging those who are dominating the sector, such as the United States and Japan. That is the opportunity that is before us, but it is one that, sadly, the Government have missed.
  8.8 pm
  Mr. Michael Jack: I am pleased to be able to speak in the debate, and I am glad that the motion asks us to take notice of various European documents that are concerned with telecommunications.
  Sadly, in many of the debates that I have attended in this Chamber I have heard a negative view from the Opposition Benches. I shall briefly deal with one or two of the points that have been raised. Part of the alleged delay on this project may have been due to a small but not insignificant event called the general election. I am glad that the Government have had the courage—certainly in the sector of telecommunications and advanced communications technology—to unleash the forces of invention and investment by the privatisation of British Telecom. Without a doubt, that has speeded up the pace of technical development and we certainly would not be as pre-eminent in Europe, if not the world, in fibre optic technology had we not been able to do that.
  I believe that commercial companies, with their inventiveness and perception of the market place, have a major role to play in providing the future equipment that telecommunications and data transmission require. Equally, they have a role to play in co-ordinating our effort within Europe. I am glad to see so much unanimity within the House about the RACE project.
  I am not a telecommunications expert. In fact, I am very much a layman in these matters, but my interest in the documents and the debate was aroused because within my constituency of Fylde we have a classic example of good European co-operation with the work that is being done on the European aircraft programme, hopefully leading to the European fighter aircraft. For British Aerospace, international communication of data will be vital. Therefore, the developments that come from a project such as RACE could have long-term implications for companies such as they.
  In looking to the background of the RACE project, I am concerned about the attitude of the telecommunications industry in this country. I should like to quote some remarks made in the magazine Computing by Ken Hoyt, the marketing director of Plessey Telecommunications and Office Systems, in which he talks about the need to ensure that the RACE project and its objectives have a strong commercial drive built into them. In other words, it should produce products that the market place requires. He said :
  "There are many real obstacles. We have to convert all this"—
  meaning research—
  "into real products sold to real people. The companies have to agree over marketing and intellectual property rights and there are many companies who are not used to working together who will have to look at each other more seriously as commercial partners."
  That point has been alluded to. That presents Europe, certainly Britain, with some fundamental problems. If a company such as British Telecom can be pre-eminent in fibre optics, that is a commercial advantage and it is something that it would wish to hang on to. Obviously, there is the question of sinking one's differences for the joint European benefit.
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  I should like to deal with one or two other areas of concern. I support European co-operation in this vital area, but I hope that developments that come from RACE will not be deemed to be a form of technological protectionism. We are not dealing just with a European communication problem, whether it be of data, voice or information: we are dealing with a world problem. There are many powerful American and Japanese companies which have participated indirectly with RACE which would be interested in the development, eventually, of a world communications network. We should not forget that, although much of our business goes to Europe, a large amount goes across the Atlantic to the United States and other parts of the free world. Who knows what we may see in the far distant future in terms of worldwide telecommunications with other parts outside the free world.
  It presents some delicate and difficult problems in striking a balance between national interest and European interest. As I said, I should not like to see RACE developed as a barrier to a world communications network. I believe that RACE offers significant opportunities for British companies to take advantage of technological developments to obtain orders. The hon. Member for Yeovil (Mr. Ashdown) listed a number of companies which have already identified such opportunities. That is the positive part of the development, and one that I am pleased to support.
  8.14 pm
  Mr. John McWilliam: I begin by delcaring my interest as a Member sponsored by the National Communications Union, engineering section.
  I do not wish to follow the line taken by the hon. Member for Fylde (Mr. Jack), but I assure him that there now exists a world communications network. The dirty bit is about who gets what within it. That is what RACE is all about and that is what we are supposed to be talking about now.
  Before I spend too much time on RACE, I should say that I welcome the EEC Green Paper on telecommunications policy. I hope that the Government welcome it as much as I do because they have gone further down the road than the Green Paper suggests and have fallen into one or two of the pitfalls that the Green Paper suggests could be fallen into by telecommunications administration. However, that is not what we are debating tonight and I do not want to spend time on that.
  One of the things that one learns as an old-fashioned telephone exchange switching systems design engineer like me is that the rate of change of technology is logarithmic. Obsolescence of the existing equipment is a reality and it is happening now. We are talking not about the next set of technology, but the set after that. We have to look at that in a world context. Japan and America are determined to try to dominate the world market. They have not succeeded in dominating our market, the French or the German markets, but they have succeeded in dominating many other markets within Europe.
  There has been a convergence between computer technology and communications technology. If one looks at that and at multinationals such as IBM, one will see that there is a simple choice ahead. We can compete with each other within Europe and be destroyed by the Americans and Japanese, or we can co-operate and compete for the world market. That is what RACE is about and that is why

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  I support it. It is simple. We can spend as much as we like on research and development in telecommunications technology as can the French, the Germans, the Italians and other Europeans. However, separately we cannot compete in the race. Collectively, if we play our full part, not only can we compete, but we can produce a product that is as good as or better than that produced by anybody else in the world. That is what RACE is about and that is what we should be doing.
  Postes, Telegraphes Telephones, the trade union in Europe concerned with telecommunications, supports fully the RACE programme. We believe that we have the research expertise. We have the basis upon which we can put together a programme that will enable us to produce the equipment that Europe and the world will want to buy in the 1990s. However, we can only do that collectively. We cannot afford to do it separately. Therefore, it is vital that RACE is supported fully. It should be fully supported by the Government.
  I will not follow the hon. Member for Yeovil (Mr. Ashdown) in his argument because he put the case more adequately than I could as to why delays have happened. However, delays certainly did happen. I am not certain that the Government are prepared to put their money where their mouth is. I look to the Minister tonight—we are much more familiar with looking at him outside the Division Lobby doors than across the Chamber——
  Mrs. Dunwoody: He lurks in the Lobby.
  Mr. McWilliam: He did in 1979. We are much more familiar with him in that context.
  I look to the Minister for a clear undertaking that the Government will not just say that RACE is a good idea but will wholeheartedly embrace it and put money into the research that is desperately needed. At the end of the day, if the Government do that, they will provide jobs. If they do not put money in, they will not. The jobs will be in France, Germany or, much more likely, in America or Japan.
  We have seen the market projections for telecommunications equipment and for the employment that will be generated by such market predictions. I want those jobs in Britain. The only way in which such jobs will come to Britain is by the House wholeheartedly supporting RACE and putting in the money that should be put in. The Government do not have a good record of putting money into European research projects.
  For the benefit of all those in the telecommunications manufacturing industry and the people who install and otherwise look after telecommunications, I need a commitment that the Government will not be stingy, that they will play their full part in the programme and put money in. If they do that, they will create not only the jobs that we need but the basis of technology that will take off in other directions as well. The argument about conversion technology works the other way. If computers are now telephone exchanges, telephone exchanges are now computers. Research and development will also spark off jobs in other directions. Unless we are prepared to play our full part and compete effectively within Europe, we will not succeed, and we will not be entitled to do so. I hope that the Minister will give a full commitment to put in that money.
  8.22 pm
  Mr. Maude: The debate has been helpful. Telecommunications debates attract true believers and people with a frightening degree of expertise. The hon. Member for Motherwell, South (Dr. Bray) spoke with a great deal of knowledge and information about the subject. He commented on the fact that a careful scrutiny of the list of ministerial responsibilities does not demonstrate that telecommunications figure high among my responsibilities. However, we are all Ministers from the Department of Trade and Industry. We all like to think that we keep a working knowledge of all the matters within the purview of the Department. I would not say that we are all renaissance men, but we like to keep our hands in on all matters. I hope that the hon. Gentleman does not consider that I have made too bad a fist of doing something that is not entirely my direct responsibility.
  We have had a good debate. The issue is important, and every hon. Member who spoke in the debate has recognised that fact in full measure at every stage. The United Kingdom has fully supported the research and development framework programme. We must decide the important part that it has to play in promoting the competitiveness of European industry. Resources must be targeted at that objective—not on large, across-the-board increases in spending just for the sake of spending. The agreement that we have reached on the framework, based on the terms that were proposed by the Prime Minister in June, will ensure that such a well-targeted programme can be satisfactorily funded within available resources. I repeat: there is no point in spending money for the sake of spending money or of being able to boast that 1 million ecu or £1 million has been spent. We must show that we are getting value and results for that money.
  Mrs. Dunwoody: What thought has been given to firms in this country that are taken over by basically Japanese or American manufacturing units? Has any consideration been given to what would happen if technology were transferred from companies in this country and the purpose of the research were to be diffused?
  Mr. Maude: The hon. Lady has mentioned a proper point. She is quite right: the purpose of the programme is to enhance and develop European industries. If such a development were to take place, it would need to be considered carefully.
  The Labour party's response to the debate has been more measured, informed and sensible than the response from the Liberal Benches. The hon. Member for Motherwell, South raised many serious issues that deserve serious consideration. They will be considered. He said that his party will be keen to be involved in any discussions to emphasise to our partners in Europe the consensus that exists in this country on the importance of such development.
  My hon. Friend the Member for Hertfordshire, South-West (Mr. Page) characterised the hon. Member for Yeovil (Mr. Ashdown) as hysterical. That is going a bit far—tetchy, perhaps, and a little excitable — but one understands that there is a certain amount of stress on members of the Liberal party at the moment. In all seriousness, I say to him that it is an important subject and he should not allow party political rancour to intrude. The hon. Gentleman attacked the overall research budget. He talked rubbish. From 1981 to 1985 the Government's

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  research and development expenditure increased in real terms to £4·6 billion. Industry has an obligation to do the same. Frankly, we are not always satisfied that industry has done the same, but it must do likewise if it is to keep up. If the hon. Gentleman were to vent his spleen on trying to persuade industry to do the same as the Government are already doing, it would be a more worthwhile use of his vocal power.
  Mr. Ashdown: The case that the Minister seeks to make is that there is no crisis in research and development. One wonders whether he has read any of the articles or the pleas and cries from the heart of universities and others involved in research over the past two or three months. It appears not. Why not? If everything is so wonderful in research and development, why must the Prime Minister take the crisis into her own hands to resolve?
  Mr. Maude: For the simple reason that it is an important matter and it deserves attention at the highest level. That is why the Prime Minister is dealing with it in that way. Certainly in my memory—it is not quite as long as the hon. Gentleman's — there has not been a time when there have been no complaints from research establishments and universities about inadequate funding. It is almost a natural condition of life. There is nothing particularly new about that. However, that is not to downplay the importance of research and development. The fact that we regard it as important is well illustrated by the fact that the Prime Minister has taken a high profile on the subject.
  Dr. Bray: I do not wish to push my luck with my colleagues or with the Minister, but he will be aware that, in the White Paper published this week, the Government said:
  "The Government recognise the importance of increasing civil R & D as a share of public R & D, and are taking action accordingly by restraining the real level of defence R & D."
  The most distinguished electronics defence research laboratory in Europe is the Royal Radar and Signals Research Establishment at Malvern. Will the Minister give an assurance that the immense potential of that laboratory and of the Ministery of Defence generally will be switched into important research programmes such as RACE?
  Mr. Maude: I cannot possibly deal with that kind of detail at this stage, but the Government already spend more on research and development than the United States and Japan. Our record is by no means bad, but we are not prepared to rest on our laurels.
  My hon. Friend the Member for Fylde (Mr. Jack) spoke with knowledge and concern. He made the valid and forceful point that all research of this kind must be closely geared to getting equipment on to the market. There is no point in spending money contemplating our own navels. We must ensure that something solid and marketable that people wish to buy will emerge at the end. The main emphasis of the programme must therefore be on the companies themselves in collaboration, proposing projects and seeking approval for them.
  The Government have been strong supporters of RACE since its inception two years ago. The Department of Trade and Industry has devoted a great deal of attention to ensuring that information about RACE has percolated down to industry—to large and small firms alike. I pay tribute to the work done by the Telecommunications Equipment Manufacturers Association to assist in that
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  process. We have also done our best to ensure that the programme itself is structured and funded in the most effective and beneficial way. British firms did well in the definition phase, which ended last year, and I am confident that they will do as well, if not better, in the main phase which is soon to begin.
  The Commission estimates that by the year 2000 up to 7 per cent. of the Community's GDP will result from telecommunications, as against only 2 per cent. today. As a number of hon. Members have pointed out, that is a remarkable rate of increase, and we must ensure that the increased employment that will certainly flow from it accrues to this country as much as to anywhere else. It is to that end that the programme is aimed. One has only to consider the City, which falls within my direct responsibility, to see how important the rapid growth of telecommunications in business can be. Increasingly sophisticated and cost-effective communications are an engine for growth in the economy as a whole, with all the attendant benefits of wealth and job creation entailed by such growth. RACE provides Europe with the opportunity to keep pace with other major world economies in this key enabling sector of telecommunications. I commend the motion to the House.
  Question put and agreed to.
  Resolved,
  That this House takes note of European Community Document Nos. 5876/85, 5876/85 Add 1, and the Department of Trade and Industry's Supplementary Explanatory Memorandum of 30th September 1985, and No. 10277/86 on Community research and development in the field of telecommunications technologies (RACE); and supports Her Majesty's Government's intention to agree to the early adoption of Community legislation with a view to stimulating co-operation at Community level in the field of telecommunications technology.

  STATUTORY INSTRUMENTS
  Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) (Standing Committees on Statutory Instruments, &c.).
  AGRICULTURE
  That the draft Meat and Livestock Commission Levy Scheme (Confirmation) Order 1987, which was laid before this House on 27th April, in the last Session of Parliament, he approved.
  HOUSING
  That the draft Grants by Local Housing Authorities (Appropriate Percentage and Exchequer Contributions) Order 1987, which was laid before this House on 8th April 1987, in the last Session of Parliament, be approved.

  CONSUMER PROTECTION
  That the draft Bunk Beds (Entrapment Hazards) (Safety) Regulations 1987, which were laid before this House on 7th July, be approved.—[Mr. Durant.]
  Question agreed to.

  EUROPEAN COMMUNITY DOCUMENT
  Motion made, and Question put forthwith pursuant to Standing Order No. 102(5) (Standing Committees on European Community documents).

  TREATIES
  That the draft European Communities (Definition of Treaties) (International Convention on the Harmonised

  445
  Commodity Description and Coding System) Order 1987, which was laid before this House on 25th June, be approved.—[Mr. Durant.]
  Question agreed to.

  CONSOLIDATION, &c., BILLS (JOINT COMMITTEE)
  Ordered,
  That Mr. David Ashby, Sir Richard Body, Sir Nicholas Bonsor, Mr. Nicholas Brown, Dr. Charles Goodson-Wickes, Mr. Robert Litherland, Mr. William Cash, Mr. Barry Porter, Mr. Gary Waller. Mr. A. R. Williams and Mr. Peter Pike be members of the Joint Committee on Consolidation, &c., Bills.—[Mr. David Hunt.]

  MEMBERS' INTERESTS
  Ordered,
  That Mr. Robert Adley, Mr. Graham Allen, Mr. John Bowis, Mr. W. M. Campbell, Mr. D. N. Campbell-Savours, Dame Peggy Fenner, Mr. Peter Griffiths, Sir Geoffrey Johnson Smith, Mr. Michael McNair-Wilson, Mr. Rhodri Morgan, Mr. Tom Pendry, Mr. Ernie Ross and Mr. William Shelton be members of the Select Committee on Members' Interests.—[Mr. David Hunt.]

  PARLIAMENTARY COMMISSIONER FOR ADMINISTRATION
  Ordered,
  That Mr. David Ashby, Mr. Jack Aspinwall, Sir Anthony Buck, Mr. Ronald Fearn, Mr. Frank Haynes, Mr. George Howarth, Mr. James Pawsey, Mr. Michael Irvine and Mr. Ron Campbell be members of the Select Committee on the Parliamentary Commissioner for Administration. — [Mr. David Hunt.]

  House of Commons Commission
  Motion made, and Question proposed,
  That Mr. A. J. Beith, Sir Barney Hayhoe and Mr. Peter Shore be appointed members of the House of Commons Commission under the House of Commons (Administration) Act 1978.—[Mr. David Hunt.]
  8.36 pm
  Mr. Bob Cryer: I shall not detain the House long, although I understand that some people thought that I intended to do so. The motion is fairly narrow and I do not wish to quibble at the appointment of the three Members named in the motion. Indeed, I look forward with relish to them undertaking their tasks.
  The House of Commons Commission is appointed under the House of Commons (Administration) Act 1978. Section 4(3) gives members of the Commission, in conjunction with Mr. Speaker, the Leader of the House and a Member nominated by the Leader of the Opposition, the power to allocate functions to the various House Departments.
  I suggest that the three Members named in the motion should consider the possibility of including in the annual report, which the Act requires them to present to Parliament, an examination of the work and activities of the professional lobbying organisations to see that no undue lobbying takes place. As a result of their experience, the three people named in the motion are also eminently qualified to consider the activities of all-party groups. Circulars that I have received from some all-party groups bear strange addresses, including the addresses of commercial lobbying organisations. I should like to know more about the relationship between the commercial lobbying organisations and the all-party groups.
  The three Members named in the motion should be prepared to undertake that task as the whole House must be anxious to ensure that all-party groups carry out the tasks for which they are eminently suited—for instance, examination of areas of agreement in relation to the disabled—with a measure of success and interest. I do not quibble about all-party groups of that kind, but I am concerned that professional lobbying organisations, paid by outside commercial interests, are providing the secretariat for some all-party groups. I am concerned at the removal of some all-party groups from the normal endeavours in which, by and large, they have a fair amount of good will to commercial marketing and lobbying organisations by virtue of the fact that they are serviced by organisations paid so to do. I believe that the three Members concerned might well spend some time considering these matters within the terms of the Act under which they are appointed.
  Mr. John Mark Taylor: The hon. Gentleman is developing his argument very skilfully and I am sure that he has the support of many right hon. and hon. Members. He will be interested to know that a letter was written on House of Commons notepaper on behalf of an all-party group during the Dissolution.
  Mr. Cryer rose——
  Mr. Deputy Speaker (Sir Paul Dean): Order. I remind the hon. Gentleman that, as he said at the beginning of his speech, this is a fairly narrow motion dealing with membership of the House of Commons Commission, not with additional powers that he may wish it to exercise. I

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  am sure that the hon. Gentleman will follow his own advice and restrict himself to the fairly narrow terms of the motion.
  Mr. Cryer: I am most grateful to you, Mr. Deputy Speaker, for not allowing me to be led astray by the suggestion that an all-party group has been distributing notepaper as though it were a commercial organisation, although I should not regret it if a little time were spent considering such matters.
  To conclude my contribution to this fairly narrow debate, the three Members named in the motion are appointed by the House under an Act of Parliament to carry out, by and large, the running of the House of Commons. That includes the running of the House Departments — the Department of the Clerk of the House, the office of the Speaker, the Department of the Serjeant at Arms, the Department of the Library, the Administration Department and the Department of the Official Report. I suggested that, among those important tasks, those three people should consider the allocation of functions to any House Department. I suggest that they should be able to discuss extending the scrutiny of those all-party groups and organisations by the Department of the Serjeant at Arms to the Speaker and Deputy Speakers.
  In not opposing the measure, I want to say that the three people concerned are being approved by the House in a resolution that would normally go through quickly and easily. I hope that they will exercise their functions with diligence, as I believe they will, but just a bit wider than they have in the past. The House of Commons Commission runs all those functions on behalf of Back-Bench Members. There was a struggle to set up the Commission and for it to have a solely House of Commons function. I am just putting down a marker in the hope that the Commission will look a little wider and consider what it can do about some organisations that should be under much closer scrutiny.
  I support the motion, but my support cannot be guaranteed in future unless the Commission produces the results that I have talked about.
  Question put and agreed to.
  Resolved,
  That Mr. A. J. Beith, Sir Barney Hayhoe and Mr. Peter Shore be appoined members of the House of Commons Commission under the House of Commons (Administration) Act 1978.

  Availability for Work Test
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Durant.]
  8.41 pm
  Mrs. Gwyneth Dunwoody: Some time in the autumn of last year it became clear that my constituency was being used as a trial ground for an extension of the Government's views on how the social security system ought to operate. It is important to realise that underlying most of the decisions that are taken on social services by the Government seems to be the unspoken assumption that if one drives people into narrower and narrower fields, rather like sheep going through a dip, in the end they will automatically come out with jobs that they have created. It does not matter whether we are talking about self-employment, the long-term unemployed or YTS schemes, which frankly are never evaluated, for they become different YTS schemes. The Government seem to be firmly convinced that one reason why many people do not work and do not find work is that they are fundamentally determined to be on the dole.
  When I was apprised of the new scheme, I began to take a considerable interest in it because a number of my constituents who are long-term unemployed and who, in some instances, had been recalled for interviews and in other instances had voluntarily gone for restart schemes discovered that they were asked a series of questions about their availability for work. Hon. Members will realise the implications of this. If one is not available for full-time work, one's benefit can immediately be put at risk
  I began to ask questions. I particularly wanted to know how many referrals to adjudication officers there had been from the restart counsellors since October. I asked that question in February. I was told by the then Paymaster General and Minister for Employment:
  "No one can lose their benefit entitlement solely as a result of the restart programme. Under long-standing legal rules",—
  and I emphasise the word "legal"—
  "people can lose their entitlement to benefit if they fail to attend an interview, are not available for work or refuse an offer of suitable employment."
  That sounds perfectly straightforward and reasonable, but when one goes into the numbers concerned one finds some interesting things. Between 10 October and 11 December 1986, restart schemes officers referred to unemployment benefit officers 21,454 cases of claimants who had failed to attend restart counselling interviews, 8,057 cases where a doubt about availability for work was identified and 153 cases where claimants had refused suitable employment.
  One of the difficulties about the whole scheme is that claimants are faced with the "Have you stopped beating your wife?" type of question. If one is a woman and one wants to go into full-time work, one is asked whether one is ready immediately to start work. Honest women, of which there are many, tend to say, "Well, I shall have to arrange for the kids to be looked after," or, "I have to find some form of transport." They are immediately told that they are considered to be not available for work or that they are considered to have difficulties.
  The answer that the Minister gave is instructive, so I shall continue with it:
  "independent adjudication officers actually disallowed benefit in the cases of 9,506 claimants … 644 claimants considered

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  not available for work and 42 claimants who had refused suitable employment."—[Official Report, 3 February 1987; Vol. 109, c. 600.]
  When I had questioned what had happened in my own constituency, I was told:
  "Between 16 June 1986 and 19 September 1986"—
  a very short period—
  "all claimants at the Crewe office reaching their sixth week of unemployment were asked to complete a questionnaire. Questionnaires were issued to 770 claimants and this resulted in 138 claims being referred to the independent adjudicating authorities. Of these, 20 were disallowed on availability grounds and 118 were allowed." — [Official Report, 5 November 1986; Vol. 103, c. 458.]
  Those figures are revealing. A total of 138 people were told that they must have their right to benefit referred to an independent adjudicating authority. Only 20 were disallowed, and 118 were allowed. However, in the period in which people are being referred for some kind of adjudication on their benefit they are not entitled to support. My local citizens advice bureau became increasingly concerned about the number of cases where payments were being suspended, on what it suspected, and I must say that I increasingly agree with it, were grounds that probably did not have a proper legal basis.
  We know that claimants must be available for work, be actively seeking work and must not put undue restrictions upon the work that they will accept. All those concepts are based on the Act, on the unemployment benefit regulations or on case law. However, we cannot find any law that justifies suspension in the circumstances that I have mentioned. The CAB, through my local office, drew attention to "LO Circular Code 7 Availability Testing", which sets out certain procedures for the staff and said :
  "However, circulars are not the law and decisions made without a grounding in the Act, or the Regulations or in Case Law may be unlawful."
  It is very easy for the House to get caught up in initials, acronyms and synonyms. We sometimes forget that those terms can mean hardship to people who may be faced with the everyday workings of bureaucracy in a way that they are unable to deal with.
  I will mention a number of cases, but I will not mention names unless the Minister would like them privately. Those cases illustrate what I am talking about. One lady, whose benefit had been suspended, was told that she failed to attend an interview with the claimants adviser. A number of young people were endeavouring to get some training and were told that they were not available for work.
  On 7 November Mr. A was called into the jobcentre for a Restart interview. He explained to the interviewing officer that he was a student at Danebank college, studying A-level history and English. He said that he studied for only 12 hours a week and considered that by doing that he was increasing his prospects of employment. He explained that he intended to go into higher education and that he still went down to the jobcentre to look for full-time work. His reasons were apparently accepted by the interviewing officer, who not only wished him well but accepted that he was available for work and was obviously trying to improve his chances of obtaining a job.
  However, on 31 March Mr. A became mixed up about the signing days and did not attend until the following week, when he discovered that his claim had been closed.
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  He had received no communication from the unemployment benefit office asking why he had failed to sign. For example, he could have been on holiday. He was just told to make a fresh claim and then he had to complete the availability questionnaire. He was immediately suspended and was told that there was a question about his availability and that his case was being referred to the adjudication section in Stockport. He was not asked to give a full account of his circumstances, and two and a half months later he had a telephone call confirming that he had been suspended because he was not available for work.
  In the meantime, Mr. A. had no unemployment or supplementary benefit. He was paid only for urgent needs and, as that does not cover housing costs, he lost the flat in which he was living. There is still no detailed decision in that case. When there is, there will undoubtedly be an appeal.
  We must ask the Minister why there were so many extraordinary happenings. Why was the claim cancelled so readily? Why was Mr. A not asked to give a full account to the insurance officer? Why has it taken two and a half months to obtain a decision? Even if there is an appeal, it will take nine months because the adjudication section in Stockport is so slow. There is an outstanding appeal awaiting submission from Stockport which was lodged on 23 September 1986. It was only last week that the office of the chairman for social security appeal tribunals in Bootle, which made it clear that it lays the blame fairly and squarely on Stockport, notified appeal dates for appeals lodged on 7 November 1986 and 1 December 1986.
  It may be said that there are some awkward cases and that there is a large problem with the number of people unemployed and so the authorities cannot always be sure but are prepared to look at individual cases. However, let me tell the House about some others, because such cases are not uncommon, and the problem in Crewe and Nantwich is probably reflected throughout Britain.
  Mrs. B works outside the Crewe area. She has a three-year-old child who was looked after between 7.15 am and 5.30 pm while Mrs. B worked by her 69-year-old mother. When Mrs. B became pregnant again and was on maternity pay she gave notice because her mother said, not unreasonably, that she could not cope with two children between those hours. The lady then began to look for other childminders, but it became clear to her that they were not available except between 9 am and 5 pm.
  The unemployment benefit office suspended Mrs. B on the ground that she had failed to avail herself of a reasonable opportunity of suitable employment. The case is covered by case law, which, in similar circumstances, found that work starting before the childminders were available was unsuitable. In my constituency there are several good play groups and nurseries, but they have long waiting lists and do not work the sort of flexible hours that fit in with the employment in what is still, thank God, fundamentally a basic manufacturing constituency. Therefore, that was not only a reasonable case to put, but it was unanswerable.
  Mr. C was a sub-postmaster and a self-employed agent for the Post Office. He decided that he wanted to go into full-time education. The Government's attitude towards those who want to go into full-time education is worrying. They seem to feel that it is crossing the Rubicon. Mr. C applied to Crewe and Alsager college to do a BEd degree in business studies, after which he wanted to teach. He

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  wanted to sell his business and go to college, with no need to claim benefit. He put his business on the market, and in June 1986 a buyer was interested. He had hoped that the transaction would be completed by August. However, the deal was not completed until February 1987. He Missed the 1986 intake and is going to college this year.
  Mr. C's wife suffers from multiple sclerosis and the long hours in the post office were affecting her health. All those circumstances were entirely beyond the control of the people about whom I am talking, so in what way could he possibly he said to be voluntarily unemployed? Yet that was the decision that was reached in his case.
  I have another case, which concerns a woman who worked as a machinist for five years. She trained as a flat-bed machinist. On 20 June 1986 she left to have a baby. The baby was born on 21 August and she received maternity pay for 12 weeks after the baby was born. She did not return to work, as her parents were unable to look after the baby and she was breast-feeding. She was suspended from benefit and her case was referred to the adjudication officer. During that suspension she received a letter asking her availability questions. She then said that she would work full-time and she started to receive unemployment benefit.
  That continued until she made the fatal mistake, because she could not find a full-time job, of taking part-time work. She was called in and questioned and told that to take part-time work meant that she was not available for full-time work. She is still actively seeking work and goes regularly to the jobcentre. The only jobs as a machinist available in the area are as an overlocker or buttonholer, for which she has not been trained. She has applied for several jobs, but no one has bothered even to answer her letters. How can a stop-gap measure of part-time work mean that she is no longer seeking work? The "full extent normal" rule may be applied to her in six months' time, but the claim of non-availability can be no more than tenuous.
  Those are the sorts of cases that I hear about every time I have a surgery. I have gone into considerable detail because we must be clear about several points. It is perfectly legitimate, when the state is paying for those who are unemployed, to make sure that those who are in receipt of benefit are entitled to it and are not lounging around refusing to find some employment or are among those who, for one reason or another, find themselves happy to remain on the general unemployment list.
  It is unreasonable to keep jigging the rules around, putting people into an untenable position so that whatever they say they are wrong. I have been through such questions in considerable detail, and they almost instinctively catch those who may not be completely articulate but who are 100 per cent. honest, who, faced with a question such as, "Would you be prepared to work outside your travel-to-work area?", will wonder whether there is a bus and what their fares will be. Their instinct is to say that they want to work within their travel-to-work area, but they have to think twice before they leave their family and work outside that area. That perfectly reasonable answer does not mean that people will not take employment. Such an answer means that people are realistic enough to say, before they go dashing off, that they want to consider where they will live, how they will get back and what will happen to the family. That kind of answer debars people from benefit.
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  I am told that I am being extraordinarily unreasonable if I think that people will be debarred from benefit. I am told that those people are simply being referred to an independent adjudicator. That adjudicating panel will then decide on the person's legitimate right to receive benefit. If that is all that is involved, the Minister has a responsibility and he should answer tonight. If people are to be debarred, even temporarily, from benefit, we must be satisfied about the circumstances in which those people will exist until that benefit has been properly adjudicated upon.
  Secondly, if people are to he referred, there must be some machinery to make that a rapid process. I do not believe that it is acceptable to say, as we say to many people at a most difficult time in their lives, "Oh well, you have been referred and with any luck you might get called within six months, or possibly it could be a little longer. Do not worry, because if you are entitled to benefit you will get the arrears." That is fine. If they are still alive, they will get the arrears. Meanwhile, they must live on something. They have to pay for their flats, they must eat and clothe themselves and generally they must keep body and soul together.
  The Government had better get their priorities right. I read the other day about insider dealing, which results in enough money being made to keep all the unemployed in my constituency in considerable comfort. I read that insider dealing is a victimless crime and that very few people need to be brought to court because, dear Lord, they are probably doing the fine male chauvinist thing and making as much money as they can by using a sharp ear and a rapid terminal. At the same time, people are existing on a rotten benefit. People are genuinely looking for work and they do not want to have to exist on the pitiful sums that they receive in benefit. If those people are long-term unemployed, they are told that they must come in, answer questions and demonstrate that they are entitled to receive benefit.
  Sometimes we can get it wrong. A letter appeared in my local paper today. I did not send it; it was sent by a highly respected Liberal councillor. In the letter she says :
  "Like many students at this time of year I have recently registered for Unemployment Benefit following the end of the present academic year … I must bring to the attention of the public the appalling treatment that is being dealt out to people … at the unemployment benefits office."
  She goes on say that she made her first claim on 1 July and was told to return on the following Monday.
  On 8 July this lady received a letter stating that her benefit was to be suspended because of the restrictions that she had placed on her availability for work. She writes:
  "From recollection I had filled in the form stating that I was available to work Monday to Saturday from 9 am to 5 pm and was able to start work at 24 hours notice. I did however state that as I had two children under four years of age I was restricted—for example I would find it hard to undertake night work. If this is the factor suspending my claim I despair of the system."
  She continues in her letter to explain what happened when she had the temerity to present herself at the local office and ask for assistance, and the way in which she and other claimants were treated.
  I know that the Government treat civil servants like dirt, and I know that since they came into office they have set out to undermine the Civil Service. I know, too, that many civil servants operating in the DHSS are in receipt of family income supplement because they are so poorly paid. I know also that we cannot consistently expect

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  people at the sharp end to have to explain absolutely unacceptable rules and put up with the insults, savagery and desperation of the people who come to see them. Over 20 years in the House I have learnt that there is a kind of desperation about people who have gone beyond the point at which they can hit back, and we see that in those who are long-term unemployed.
  I have seen good people destroyed by long-term unemployment. I have seen people who, no matter what the brilliant television adverts say, know very well that we have created a society that really cares only for those with money, and cares nothing for those with skills. At the moment we see the complete snarl-up of bureaucracy, the inability of many genuine claimants to receive their entitlement and the punitive attitude of the Government, who seem to believe that the long-term unemployed who receive benefit must come in and be cross-examined and in most cases be deprived of benefit for long enough for the Department to decide whether they are entitled to receive anything.
  If that is the Government's attitude, the result is not just to fiddle the figures, although that is certainly one effect because it takes people off the unemployment benefit for long enough to have their cases looked at before they are returned to benefit. However, what it does to people in the meantime is absolutely abhorrent to anyone who lives in a civilised society. We are not talking about ciphers, about people who are born cheats and who know how to get the best out of the system. We are talking about people who desperately need benefit.
  I hope that the Minister has the kindness and the understanding to say that the Government will look at the way in which the system operates. I hope he will say that if what is happening in Stockport is happening in other adjudicating centres all over the United Kingdom he will instantly do something about it. He should say that he will appoint more staff, make sure that there is a specific speed-up and look at the reason why this is happening.
  If the numbers of people being deprived of benefit in Stockport is a reflection of what is happening elsewhere, it means that two thirds of people who are entitled to benefit lose it. Many of them get it back, but in the meantime they have to cope without any support whatever. If the Minister says that there are difficult cases but that they are very much the exception, I shall tell him that, based on conditions in my constituency, I do not think that that is the case. Many of the long-term unemployed are being put through a wringer, and that is wholly unacceptable.
  That may not be the intention of the Government, but that is what they are doing. They are demonstrating double standards, because people at the bottom of the scale are being squeezed, while at the top of the scale, as long as they are operating in the City of London, people seem to be able to get away with murder. That will not do and I do not think that the Minister would want to be party to that kind of behaviour. I ask him urgently to go away from the House and find out what is happening under his own system. If he is not satisfied with it, he must change it, or the House will have something to say.
  9.6 pm
  The Parliamentary Under-Secretary of State for Employment (Mr. John Lee): Perhaps I might first
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  genuinely congratulate the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) on raising this important subject and giving us the opportunity for this brief debate. While inevitably I do not agree with many of the points itmade by the hon. Lady, I know that she has been concerned about the operation of the availability for work test in her constituency. There has been considerable correspondence between the hon. Lady and my Department. Therefore, I am glad to have this opportunity to discuss the issues involved.
  The first point that I must make is that the availability for work test applies not just to Crewe and Nantwich but to the country as a whole. Therefore, it would be useful if I were to remind the House of the reasons behind last year's changes to the procedures. First, let us be clear on the law. This says that unemployment benefits are payable only to people who are available for work on every day for which they make a claim. The law is contained not in any statute passed by this Administration but in the Social Security Act 1975. That is an important point, because it is often alleged that the changes introduced last year tightened the law on availability for work. That is not so. Indeed, the basic requirement to be available for work as a fundamental tenet of receiving benefits while unemployed has existed virtually unchanged since the passing of the Unemployment Insurance Act 1935.
  The changes introduced last year were solely concerned, therefore, with the administration of this existing requirement. Until last year, the enforcement of this condition depended in practice on a single question asked of all claimants when they first made a claim to benefit, namely: "Will you take any job which you can do?" To that question 99 per cent. of all claimants answered yes. It does not need great vision to see that this was hardly an effective check on those claimants who might not have been fully available for work. Indeed, during 1984, the Comptroller and Auditor General's National Audit Office, in examining the way benefits were assessed and paid to unemployed people, pointed out that a claimant could easily deduce what answer was required in order to qualify for benefit.
  The people in the Audit Office were not the only ones to arrive at that conclusion. The all-party—I emphasise "all-party" — Public Accounts Committee, in its 30th report published in September 1985, was also unhappy with the existing arrangements. The Committee said:
  "We are concerned about the weakness of the formal test of availability for work and welcome the DHSS's decision to consider whether more effective tests are practicable".
  It was in the light of these concerns, which the Government had also come to share, that we decided early last year to set up a number of experiments to see whether a more satisfactory procedure could be devised.
  Twelve unemployment benefit offices took part in the experiments, with a further 12 offices gathering statistical information for comparison purposes. Crewe UBO, in the hon. Lady's constituency, was one of the offices taking part. The experiments consisted of issuing a questionnaire on availability to all claimants. The results showed that more comprehensive questioning of claimants in this way had the effect of identifying the number of people who were not genuinely looking for work. Between 3 and 4 per cent. of claimants did not pursue their claims once the requirement to be available was brought to their attention and a further 2 to 3 per cent. had their benefit disallowed. It also identified others who, while not available for work,

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  were entitled to different social security benefits and helped unemployed claimants towards job vacancies or training and enterprise schemes.
  However, the experiments also showed that the questionnaire could not be applied in a simple, mechanistic way and that claimants often needed guidance on other benefits to which they might be entitled and about labour market opportunities in general.
  The results of the experiments led us inevitably to the conclusion that the availability questionnaire, supplemented by interviews with claimant advisers, when helpful, should be completed by all new claimants to unemployment benefit. We accordingly informed the House to that effect on 28 October last year. Indeed, I venture to suggest that, had we not moved to introduce the new procedures nationwide, we would have left ourselves open to justifiable criticism from the Public Accounts Committee and others that we were failing properly to safeguard the use of public funds and the national insurance fund.
  Inevitably also the new procedures have been criticised on a variety of grounds—not least that they are in some way oppressive or that we are asking trick questions. The procedures are not oppressive. The questionnaire does not ask "trick" questions, but rather perfectly straightforward ones.
  Mrs. Dunwoody: Will the Minister tell me three things—has he read the form; how would he answer some of the questions; does the PAC know the type of form that is used at present to take people off benefit—because that is what it is doing?
  Mr. Lee: I have indeed seen the form, and I have a copy of it with me tonight, but I am not prepared to go through it in detail in terms of the way in which I would fill it in. However, I shall be happy to discuss it in the Tea Room later with the hon. Lady.
  Mrs. Dunwoody: I know what the form says.
  Mr. Lee: I, too, know what it says.
  Those claimants who are genuinely available and seeking work will have no difficulty in satisfying the requirements. Rather, the questionnaire helps us to identify the minority of claimants who seek to abuse the benefit system, and those people who need special advice and guidance with their efforts to find work or to claim the correct benefit. I am surprised that anyone should hold that to be in any way improper.
  It may, however, be helpful if I deal with some of the specific criticisms that have been levelled at the new procedures, some of which have been raised by the hon. Lady. I shall deal first with the suspension of benefit while availability is decided.
  In the first place, critics have referred to the practice of suspending payment of benefit while a doubt about a claimant's availability is resolved — resolved, I should make it clear, not by Ministers, but by the independent adjudicating authorities who decide all questions relating to entitlement to benefit. Let me make it quite clear that the suspension of benefit in these circumstances is not new. It has been the long-standing practice under successive Administrations and applies not just where doubts arise on the availability for work condition, but in the case of doubts about any of the conditions for receipt of benefit. That seems to be quite right — to pay out benefit to someone with doubtful entitlement while that entitlement is being determined seems a dubious use of public funds.
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  There is also the alleged criticism of suspended cases that are ultimately decided in the claimant's favour. It has also been suggested that, because a high proportion of the cases put to adjudication officers are "allowed" — in other words, decided in favour of the claimant — that calls our procedures into question. I find this a strange proposition. Just because a case is "allowed" does not mean that it was wrong or inappropriate to have referred it for a decision. Indeed, with cases of availability, adjudicators have always had discretion to give the claimant the benefit of the doubt and review the case at a later stage, which obviously increases the number of cases where benefit is not disallowed.
  The hon. Lady raised with obvious and sincere concern the question of hardship while benefit is suspended or disallowed. Questions have also been raised about the effect when benefit is suspended while a question of availability is decided. Let me make it quite clear: it is and always has been the case under successive Administrations that where a person is disallowed benefit because he is found not to be available for work or where benefit has been suspended while the question of availability is being considered by an adjudication officer, benefit is not payable. In those circumstances, the DHSS can nevertheless make an urgent need payment where the situation warrants it. The DHSS has that flexibility.
  Moreover, in practice, where a person is likely to be entitled to an alternative benefit which does not require him to be available for work, the unemployment benefit officer will often refer the case to their claimant adviser who can usually help to get the alternative benefit put into effect.
  Mrs. Dunwoody: I apologise to the Minister for intervening, but this is important. How long does it take on average for an adjudication to take place? I am not arguing about whether successive Governments have always said that if a person is entitled to benefit he should have it. From listening to this Government, one might occasionally think that that was not the case. How long is it before a case is answered? That must be directly relevant because, as the Minister knows, the urgent needs payment does not meet overheads.
  Mr. Lee: I understand from information which has just been made available that it is about eight days. As I have said, the DHSS has flexibility and the power to make urgent payments if the case warrants and justifies it.
  The hon. Lady asked about the effect of the test on women with children. Various people and organisations have also raised this question. It seems to me to be a perfectly reasonable expectation that a woman who has children to care for but who is looking for work has made some plans for their care if she gets a job. If she does not, she will hardly be in the position to accept an offer of employment; there must, therefore, be some doubt about her availability for work which it would seem reasonable to put to an adjudication officer for decision. There is no intention whatever that the new procedures should be targeted in any sense towards women and children; but it is equally the case, as it was under the previous Labour Administration, that a married woman, in the same way as any other claimant to unemployment benefit, must demonstrate that she is available for work.
  On the register effect, there have been those who allege that availability testing is just a device for reducing the

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  unemployment count. Once again, I refute that. This is not the case. The revised procedures were designed to meet the criticisms made by the Public Accounts Committee and others who said that our existing arrangements were "weak". The procedures aim simply at establishing eligibility for benefit and as such have improved our ability to identify people who are not available for work.
  Concern has been voiced and criticisms made about the effect of the procedures on students. Obviously, being a basic eligibility condition, availability for work applies also to students who claim benefits. However, if they can show that they are actively seeking work and are both willing and able to take up a job or a job interview, their availability can be accepted. Many students are able to satisfy this condition, but where they are not it is once again the case that they have failed to satisfy one of the fundamental conditions for the receipt of benefit.
  I am grateful to the hon. Lady for having given me the opportunity to speak on this topic and to dispel some of the misconceptions about the availability for work condition. The vast majority of claimants to unemployment benefit are actively seeking work and will have no difficulty in satisfying the availability condition. But we cannot and we will not accept that the minority of claimants who do not satisfy that condition should receive benefit none the less. It is to that end and that end alonethat the revised procedures which we introduced last year are directed.
  Mrs. Dunwoody: Will the Minister give way?
  Mr. Lee: No. I have given way on several occasions.
  If the hon. Lady would like me to consider specific cases after this debate, and I can do so if they are free from the legal adjudication procedures, I shall gladly do so.

  Tourism
  9.20 pm
  Mr. Timothy Kirkhope: I am very grateful for this opportunity to raise a matter that I consider very important — tourism, particularly in industrial cities in the north of England. However, for the benefit of other hon. Members, I do not want to narrow my remarks. The subject of tourism has not been debated very often in the House. Indeed, I was very surprised to learn how infrequently such an important matter has been debated here: only a handful of times in the past few years. In a debate on 7 December 1984, my hon. Friend the Member for Sherwood (Mr. Stewart), who introduced the debate, said that it had been some 27 years since tourism had been specifically debated.
  I regret that the Chamber is not better attended for my remarks on such an important issue — especially by Opposition Members, many of whom represent the very industrial areas in the north with which I am particularly concerned, and to which I believe tourism has so much to give. However, that will not stop me from developing my theme, which arises largely from a question that I put yesterday to my hon. Friend the Member for Pendle (Mr. Lee), the Under-Secretary of State for Employment. I wanted to find out precisely how many tourists had come from overseas to visit this country last year. The answer was no fewer than 13·8 million. That enormous figure is very creditable, and shows a definite increase over the past few years.
  The increase has not come about by accident. It is clearly a result of the many initiatives that have been taken. Some have been taken by Government, some by our tourist authority and — this is especially important —some by private individuals, the entrepreneurs who wish the tourist business to be a great success. I think that we should be very grateful to them for the work they have done.
  We have done well. We have created many jobs in the tourist industry. If they were present, Opposition Members would no doubt suggest that the jobs created in tourism and the service industries are not always proper jobs. I would say that they are indeed proper jobs. However, they are not only proper jobs, but jobs that allow people to show all the best characteristics of the British: initiative, enterprise and a positive attitude towards hard work. The tourist industry releases that enterprise and initiative, along with the inventiveness of the British people.
  In some respects, we have fallen behind some of our European competitors. One of our problems is, of course, our weather. There is very little that hon. Members can do about the weather — very little, indeed, that the Government can do about it. Nevertheless, it is a factor, and it undoubtedly means that people who might otherwise spend their holidays here go elsewhere on the Continent to enjoy the rather better weather that tends to prevail there. That is very sad, but it is a problem with which we shall doubtless continue to live.
  The lack of good weather, however, is more than made up for by our heritage—the pure history of our country. Much of that history is to be seen in our buildings, monuments and museums, which show the nature and characteristics of this country to their best advantage.

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  Sadly, we have tended to concentrate too much on those areas that traditionally have been assumed to be worth visiting—for example, London.
  This year we are welcoming many visitors to London, and we hope that they will continue to come here, but from time to time hon. Members find that access to this place from the streets round about Parliament is difficult and that other conditions in London are somewhat oppressive. In no way do I want to dissuade them from coming. I am simply pointing out that, for visitors, London is a focal point. Another major tourist attraction, for obvious reasons, is Stratford-on-Avon, and Oxford and Edinburgh also attract large numbers of tourists.
  This country is very small and its road and rail connections are excellent, so it is unnecessary for tourists to concentrate only on a few locations. We should advise tourists to go elsewhere for reasons other than the pure excitement that the capital offers or the beauty of the countryside in the south of England. When advising visitors to go elsewhere than London, it is tempting to suggest that they should visit only rural Britain. However, much of the history and wealth of this nation is bound up with our urban industrial communities.
  Inevitably, that leads me to refer to the north of England and to parts of Scotland. I represent a northern constituency. I am proud to represent part of Leeds. It is a very great city. During the industrial revolution it made a great contribution to the wealth of this nation. It has survived successfully the post-industrial era. Inevitably and sadly, jobs have been lost in my city because unproductive industrial plant has had to be closed. However, the city is now thriving and expanding. It is a major commercial and financial centre, and unemployment is diminishing.
  The people of Yorkshire are noted for taking up opportunities that allow them to succeed. They wish to share their success with others. There are already tourist successes in Yorkshire. Many people already visit the delightful spa town of Harrogate. Many foreigners on their way to Edinburgh also visit Fountains Abbey, a most delightful spot. Sadly, however, not enough tourists visit Leeds. Were Opposition Members present, I should say to them that some of their remarks about cities such as Leeds and Liverpool do nothing to encourage visitors to go there; many of them are left with the impression that they are unattractive places, full of militants of various kinds.
  Mr. Kenneth Hind: They are.
  Mr. Kirkhope: Indeed, they are full of political militants, but I hope that visitors do not think that the streets are full of militants generally. Opposition Members give people the wrong impression. People avoid such places because they believe that they are squalid or undesirable, when the reverse is true.
  Leeds has many fine buildings and museums, some delightful parks and excellent entertainment facilities. It also has a river and a canal, and it was the canal which brought the city much of its prosperity and carried many of the goods produced, contributing greatly to the woollen industry. Features such as that canal could be greatly enhanced to improve the environment for the benefit of visitors. Leeds has a good railway station, an airport nearby and excellent roads.
  How can we best exploit those facilities? When I asked my hon. Friend the Minister a question yesterday, he was
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  most helpful and talked about developments in Leeds. However, I hope for much more. I would not wish too much reliance to be placed on the local authority, although I acknowledge that local authorities with a positive attitude can do much to improve tourism and attract people to places such as Leeds.
  I would like to see far more initiative being taken by those enterprising Yorkshiremen — by individuals, companies and entrepreneurs. They are there and waiting and perhaps they just need a little more encouragement to get going. I ask my hon. Friend whether the planning machinery is adequate in that regard. Perhaps it is time to consider some short-circuiting of the processes to encourage such enterprises.
  I am sure that the Government are doing much. As I said, one has only to refer to the statistics for the past eight years for tourism, and the increased revenue from tourism, to prove that the Government have been most successful. But are they doing enough? Perhaps my hon. Friend the Minister will tell us. I am not criticising him in any way, but I wonder whether more could be done.
  To assist tourism, we must examine areas outside the narrow band that I mentioned earlier. As I said, progress has been made. Bradford, a city near Leeds, has a most excellent museum of photography to which people come from far away. Indeed, it was featured in a Radio 4 programme yesterday. Bradford even encourages visitors to come and look at its cemetery, where many of the leading exponents of the industrial revolution are now at rest. There is also the question of the British museum's Asian collection. I urge that that collection should be encouraged to move to Leeds or Bradford where it would be most welcome and where visitors would come to view it with great interest.
  For some time I was a county councillor on Northumberland county council. During that time we saw the development of the Beamish open-air museum, which was an interesting development in County Durham, drawing together much of our industrial history. That is an example of what can be clone. I am not sure whether it is a good idea to draw these activities together on one site or whether it is better to retain them on their existing sites and encourage people to see them there, but I should very much like such developments to be encouraged.
  It is a matter of the map for tourists. I should like to encourage the tourist authority not just to consider displaying on the front page of brochures pictures of Beefeaters, however attractive they may be, but to give priority, for a change, to the pictures of some of the old Yorkshire mills and industrial architecture in which people are so interested. That is one way in which we might bring about a movement of tourists to the north of England and other areas outside London. Even many of my hon. Friends who represent constituencies which are not in the north feel that London and the north are polarised and that tourists should be advised to look to places other than London.
  Britain is not just the Palace of Westminster, the red buses, the London taxi cabs and the quaint soldiers and policemen who smile. It is more—it is an industrial heritage, a part of this country which perhaps has been ignored for too long by tourists and others who care about exploring and finding the country's character. I urge the Government to do whatever else they can to achieve, through co-operation, a greater initiative for tourism in the north.
  9.36 pm
  Mr. Andrew Hunter: The circumstances in which a Back Bencher finds himself are infinitely varied and unpredictable. I welcome this opportunity to contribute to this important debate. Clearly, tourism is a subject of interest to many hon. Members, but, alas, not Opposition Members. It is a growth factor in our national economy. I congratulate my hon. Friend the Member for Leeds, North-East (Mr. Kirkhope) on finding this opportunity to bring such an important subject to our attention.
  My hon. Friend was good enough in his opening comments to suggest that we could widen our debate and not concentrate exclusively on inner cities. It has been my privilege for just over four years to represent the constituency of Basingstoke, and Basingstoke cannot be described as an inner city. But there is an affinity between the position that leads me to seek to catch your eye, Mr. Deputy Speaker, and the factors that motivated my hon. Friend the Member for Leeds, North-East — how to extend the tourism net. Tourism is a growth industry and it is important that all parts of the country should benefit from it.
  In one limited respect, Basingstoke has an affinity with the premise on which my hon. Friend the Member for Leeds, North-East began his comments. Much of Basingstoke's growth in recent years has been due to overspill from London and the development which depended on and resulted from it. There is idyllic countryside around us in north Hampshire. Surely, in the last resort, the greatest tourist attraction we have to offer is our English countryside. The area has a number of historic monuments and houses, including the ruins of Basing house, which are graphically depicted within these buildings, and The Vyne.
  My hon. Friend the Member for Leeds, North-East asked what can be done. There is pump-priming by central and local government, but is it not essentially a question of attitude? We must be proud of the part of the country in which we live. We must sell that area as a community. We cannot look to central Government for finance or to local government for a rearrangement of priorities. We must be proud of what we stand for and the areas in which we live. We, as individuals and a community, rather than the Government, are the vehicle for tourism.
  9.40 pm
  Mr. John Redwood: I am grateful to my hon. Friend the Member for Leeds, North-East (Mr. Kirkhope) for the opportunity of taking part in the debate without too much competition from the Opposition Benches. It is a sadness to many of us that 12 Conservative Members are here on their own to consider how northern towns can be revived and the important role that tourism and leisure industries can play in that revival.
  It is no coincidence that if we look at some of the northern towns that are prosperous, such as Beverley, Harrogate and Chester, we discover a conjunction of attractive town centres, the development of tourist sites, lower unemployment and greater prosperity. The tourist industry can act as a magnet for people and spending power. In turn, that prosperity can fructify and improve the built environment and the general surroundings of the towns and local villages.
  That model should therefore be applied elsewhere. My hon. Friend the Member for Leeds, North-East has made
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  a good plea for more Government attention and assistance to ensure that that magnetic power fructifies in the hard-hit northern cities. At the heart of many of those important cities lie historic sites of which we could make more, because those attractions could be enlarged.
  Those policies will work only if they are seen as part of a wider package of measures to regenerate the inner city cores. At the heart of the matter lies the importance of land use and the policies to bring in urban development corporations to ensure that public sector land is better used and returned to wider uses. Those policies will lead to a better built environment, which in turn will make those cities more attractive focuses for tourists and leisure industries.
  We must ensure that, as that land use and recycling is occurring, we succeed in making enough green space and leisure use available in the inner cities. At the same time, we must rebuild housing and bring in industry and commerce to produce the prosperity that those inner-city areas need.
  Mr. Ian Taylor: Does my hon. Friend agree that the garden festivals in Liverpool and Stoke-on-Trent have been an eminently good example of the way that derelict land can be made use of for commercial benefit and the benefit of vistors?
  Mr. Redwood: That is one example, of many, of the sort of development that can begin to turn the tide in hard-pressed inner-city areas.
  An interesting study arrived on some of our desks this week from an independent Commission that was set up by housebuilders in this country which considered the problem of inner-city rehabilitation. I give it two cheers because it shows that house builders have progressed from their position of two or three years ago when they said that there was little that could he done to recycle urban land or develop new housing in inner-city areas. They now confess that there is quite a bit of land available and that things are beginning to happen. They are still too pessimistic, and they lack ambition to foresee the chance to revitalise inner-city areas and build more in them to improve the environment.
  That is the burden of my message. Tourism and leisure have a vital role to play in inner-city revitalisation. Land use lies at the core of the problem, and we must mobilise the private sector — house builders, the tourist and leisure industry and others—to rebuild those cities, and rebuild them fast.
  9.44 pm
  The Parliamentary Under-Secretary of State for Employment (Mr. John Lee): I arose early this morning and travelled to Margate to visit Hornby Hobbies, an excellent firm there. I hosted a seminar under our "Action for Jobs" banner and this afternoon opened a new swimming pool at the Lonsdale Court hotel, also in Margate. I then travelled back to London to participate in the "Come to Britain" trophy award ceremony at the Institute of Directors early this evening and now find myself answering my second Adjournment debate. After all that, I look back with a clear conscience to the vote in which I participated in the early hours of this morning on the increase in Members' salaries.
  Having said that, I am delighted that we have an opportunity for another shortish debate on tourism. I

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  congratulate my hon. Friend the Member for Leeds, North-East (Mr. Kirkhope) on his seizure of the opportunity to discuss this vibrant issue. It is an exciting industry and it is marvellous to have the support of so many of my parliamentary colleagues from the Conservative party who are committed to the growth and development of tourism.
  Mr. Graham Riddick (Colne Valley): Does my hon. Friend agree that it should be put on record that there is not one Opposition Member present and that those people who tell us that they care so deeply about northern areas have not seen fit to listen to this debate or participate in it? It is important that everybody who reads tomorrow's Hansard should be made fully aware of the fact that there has not been one representative from any of the Opposition parties present.
  Mr. Lee: Hansard will record what my hon. Friend has said. I know of my hon. Friend's commitment to tourism and the development of it in his constituency of Colne Valley, which I visited recently.
  I shall set the scene in national terms. The Government are spending about £67·5 million on overall support for the tourist industry, excluding help by way of the community programme and urban development grants. The industry's total turnover at present is probably about £15 billion and it is growing steadily. In the three months February to April, overseas visitors were up by 10 per cent. this year. Last year, as has been said, 13·8 million visitors came to this country. This year, we are heading for a record. About 1·4 million jobs are sustained by tourism and that is growing at a rate of 40,000 to 50,000 a year. Yesterday, the English tourist board estimated that by the early 1990s another 250,000 jobs may be created in this dynamic growth industry.
  In my region, the north-west, employment in tourism grew by 12 per cent. in the two years to December 1986. The industry is led by the private sector with a degree of pump priming by the Government, as my hon. Friend the Member for Basingstoke (Mr. Hunter) said. The cost for new construction in the industry is running at about £1 billion a year. As I endeavoured to say yesterday at Question Time, there is a complementary relationship between service jobs in tourism and manufacturing jobs. For example, many manufactured products go into the construction of a new theme park or hotel and many building materials are used in the construction of a new conference centre. There is also a need for catering equipment, heating equipment and uniforms worn by the staff.
  Historically, tourism in the United Kingdom was centred mainly around our seaside towns, museums, art galleries and sporting events and our national tourist attractions such as Buckingham Palace, the Palace of Westminster, Madame Tussaud's, the tower of London, Stratford-upon-Avon, Edinburgh castle and the idyllic countryside referred to by my hon. Friend the Member for Basingstoke.
  In recent years, we have seen a wholesale expansion in the range of tourist attractions throughout the regions. Increasingly, we see evidence of how tourism and leisure can make a significant contribution to the regeneration of many inner cities. As my hon. Friend the Member for Wokingham (Mr. Redwood) quite rightly said, it can play only a part, but nevertheless it is a significant part.
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  Tourism development and environmental improvement can unquestionably bring about an improvement in the quality of life for local residents. In turn, such developments can generate encouragement for the industrial and retailing sectors to expand in adjacent areas. Increasingly, particularly in the regions, we see successful tourism-related developments in which there has been a true partnership between central Government, local government and, of course, the private sector. We look nationally at the panoply of schemes throughout our country, particularly in our industrial regions.
  I refer to the docklands in London and Albert docks in Liverpool—about 16 million tourists go to Liverpool each year. The garden festivals were referred to by my hon. Friend the Member for Esher (Mr. Taylor). Salford Quays is developing adjacent to Manchester and the G-Mex centre is in Manchester itself. I am proud to say that Manchester is my home city. It won the "Come to Britain" award. It has had 1 million visitors this year. The new Grenada studio tours project is coming on stream. It has been helped by a grant from the tourist boards. In London, there is the Royal Agricultural Hall, now the business and design centre, in Islington. In the midlands there is the Birmingham conference centre, which is developing. In Bradford there is the national photographic museum.
  In Southwark—back to London— there is the Globe theatre. I was privileged last week to be at the ground-breaking ceremony. There are major theme attractions at Alton Towers, which has over 2 million visitors each year. Tourism developments have been taking place in many smaller north-western communities.
  Mr. Patrick McLoughlin: My hon. Friend mentioned the midlands and Alton Towers. On Monday, he will visit two excellent tourist attractions in my constituency—Gulliver's Kingdom and the Heights of Abraham. Those developments have been done by the private sector and have brought great employment benefits. My hon. Friend is doing a lot of work in his new appointment. We will welcome him to west Derbyshire on Monday to see the new developments.
  Mr. Lee: I look forward to being in west Derbyshire on Monday. In fact, I am going there after opening a picnic site in Buxton. I shall take my family with me. We will be a genuine tourist family on that occasion.
  I was referring to some of the smaller sensitive developments that are taking place in our industrial regions. I refer specifically to developments such as Quarry Bank mills at Styal, the enterprising, successful Wigan pier development. In my constituency, which is famous for its Pendle witches, an excellent heritage centre draws about 15,000 visitors a year.
  My hon. Friend the Member for Leeds, North-East talked about Leeds. Yesterday, I paid generous praise to the contribution that the Leeds city council is making in the development of tourism in and around Leeds. He talked about the number of visitors. Already, Leeds is getting many visitors to existing attractions. I refer to the Abbey house museum at Kirkstall abbey which has about 200,000 visitors. The city art gallery had about 120,000 visitors in 1985, and Harewood house had about 180,000 visitors and Temple Newsom house had about 50,000 visitors in 1985.

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  Increasingly, tourists are going to Leeds and new developments are under way. Unquestionably, more visitors will go there.
  I conclude by repeating the areas on which I personally intend to concentrate in the years that, I hope, lie ahead of me as Minister with responsibility for tourism. I intend to implement a campaign to achieve a spotless Britain. As a number of hon. Members mentioned at Question Time yesterday, there is too much litter on our streets and shores. Signposting also requires improvement. The tradition of service does not come easily to this nation and we could do much more to make visitors feel welcome and appreciated. Unquestionably, too, we can do much more to train people coming into the industry and to improve the quality of our tourist attractions. Finally, I wish to encourage the employment of more disabled people to pursue careers in the industry. From the point of view of
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  the visitor and consumer, I wish to ensure too, that more hotels, conference centres and tourist attractions have acceptable and satisfactory means of access for those who, sadly, suffer from disabilities.
  I hope that in this short speech I have been able to cover a wide range of aspects of tourism, from the traditional to more recent developments and some of the themes that I personally intend to pursue. I conclude by congratulating my hon. Friend the Member for Leeds, North-East once again on raising this subject. As one who was born in Manchester and represents a north-western constituency in north-east Lancashire, I am totally committed to the role of tourism. I have seen for myself what tourism can do in part to regenerate our regions and industrial cities and I am committed to ensuring that in those areas, in Yorkshire and in my hon. Friend's constituency of Leeds, the development of tourism in future comes on apace.
  Question put and agreed to.
  Adjourned accordingly at four minutes 1to Ten o'clock.