Commons Sitting of 10 February 1988

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

    Company Liquidations
    Mr. Ron Brown: To ask the Chancellor of the Duchy of Lancaster how many companies went into liquidation during 1987; and if he will make a statement.
    The Parliamentary Under-Secretary of State for Corporate Affairs (Mr. Francis Maude): The number of company insolvencies in Great Britain in 1987 was 11,645—about 22 per cent. less than in 1986.
    Mr. Brown: Is the Minister aware that some companies deliberately go bust in order to renege on their commitments to staff, customers and creditors in general? For example, does he know that Glendevon Carpets in my constituency did that not so long ago and that many people suffered? Indeed, the company went out of business and resurrected itself elsewhere under a different name. The people behind that move got off scot free—I do not mean that as a pun, because the matter is too serious. Do the Government have any ideas or proposals that may deal with that problem?
    Mr. Maude: The phenomenon to which the hon. Gentleman referred is well understand and, regrettably, does happen. It was addressed in the Insolvency Act 1985, which gives courts the right to disqualify directors if they are found to have been guilty of misconduct such as that.
    About 64 directors have been disqualified in the past few months since the new regime came into force, and about 120 further applications are being made by my Department to the High Court for further disqualifications. I hope the hon. Gentleman is satisfied that it is a problem which we take seriously and have already addressed.
    Mr. Andrew Mitchell: Does my hon. Friend agree that it is not so much liquidations as new business start-ups that are the important figures? Does he agree that new business start-ups under the Government have been—
    Mr. Speaker: Order. The question is about liquidations.
    Dame Elaine Kellett-Bowman: I have a question about that.
    Mr. Speaker: Yes, later.

    Financial Services Act
    Mr. Tim Smith: To ask the Chancellor of the Duchy of Lancaster if he will make a statement on progress in implementing the Financial Services Act.
    Mr. Maude: Three self-regulating organisations have now been recognised under the Financial Services Act 1986. In addition, eight professional bodies have obtained interim recognition under schedule 15 to the Act. Two other self-regulating organisations, one professional body, seven investment exchanges — including one overseas exchange—and two clearing houses have applied for recognition, but have yet to be recognised. I intend that the central provisions of the Act will be implemented in April.
    Mr. Smith: Is my hon. Friend aware that he has made excellent progress in implementing the provisions of the Act? Given the complex and comprehensive nature of the provisions, it is remarkable that there has not been more slippage. However, will he comment on two matters that will be important after A day in April? First, when will the compensation scheme be introduced; and, secondly, how will we ensure that there are not too many investment businesses that have only provisional authorisation after A day?
    Mr. Maude: It has always been intended that the compensation fund should come into operation three months after section 3 of the Act is implemented in April, and that remains our intention. I fear that there will inevitably be a number of investment businesses that are interim-authorised immediately after A day, particularly at the smaller end of the range. We understand that about 10,000 to 12,000 firms will he applying to the Financial Intermediaries, Managers and Brokers Regulatory Association for authorisation. It is simply a physical impossibility for all those to receive full vetting treatment before A day. However, I know that FIMBRA has that problem in mind and will seek to keep to a minimum the number of interim authorisations.
    Mr. McCrindle: The Minister will be aware of allegations of excessive legalism on the part of the Securities and Investment Board and some of the SROs. He will also be aware of the suggestion that the cost of registration, particularly for small firms, is quite excessive. Has he given any consideration to those allegations, and what is the response that he would like to communicate, perhaps through this question and answer session?
    Mr. Maude: We are aware of the concerns expressed. It is important that we should have a full and adequate system of investor protection, but it is equally important, in the interests of investors, that that system of regulation should not be so burdensome on business that choice for consumers of investment services is reduced. This is why we have built into the Act the competition scrutiny carried out by the Director General of Fair Trading.
    In addition, my right hon. and noble Friend has asked the Securities and Investments Board to report to us on a quarterly basis after the Act comes into full force in April on the effect of the Act and the rule books on businesses themselves. I stress that it is a practitioner—led system of regulation. All the self-regulatory organisations and the SIB are dominated by practitioners. It is up to the practitioners to ensure that their voices and concerns are heard in the process of regulation.
    Mr. Blair: Is the Minister aware that, although the provisions of the Financial Services Act are necessary, they will impose a great administrative burden on many small firms and individuals, as well as on the organisations dealing with the applications? I understand that many

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    thousands of firms may be in that position. Will he tell us what will be the position of the firms that are unable to register with the self-regulatory organisations or the SIB, simply because of the incapacity of those organisations to process the applications sufficiently quickly?
    Mr. Maude: My message to those firms is clear. If they submit their applications by P day, which is 27 February, even if the organisations cannot fully process the applications by A day, the firms will obtain the benefit of interim authorisation. The message to those companies is clear: to submit their application swiftly and, in any event, before 27 February.
    It is right that we should try to ensure that the burden falling on small businesses is as limited as possible. FIM BRA comprises 85 per cent. of small firms, which have a clearly heard voice in the councils of FIMBRA. In the recent elections a number of small firm representatives were elected to the ruling council of FIMBRA, which is a healthy sign.

    Telecommunications
    Mr. Patrick Thompson: To ask the Chancellor of the Duchy of Lancaster what was the level of output in the telecommunication industry in (a) 1986 and (b) 1980; and what was the level of exports in the industry over the same period.
    The Parliamentary Under-Secretary of State for Industry and Consumer Affairs (Mr. John Butcher): Manufacturers' sales of equipment increased from £953 million in 1980 to £1,750 million in 1986. Exports were 10 per cent. of sales in 1980 and 12.5 per cent. of sales in 1986. There are no comparable statistics for the services sector.
    Mr. Thompson: I thank my hon. Friend for that encouraging reply, which shows the kind of improvement in the telecommunications industry and its performance that we all want to see. Some time ago my hon. Friend was quoted as saying that it was easier to export telecommunications equipment to Detroit than to Dusseldorf. Does he still say that today?
    Mr. Butcher: Regrettably, yes. Non-tariff barriers are still operated in Europe. Some of the post, telegraph and telecommunications organisations in Europe still operate monopoly purchasing practices. It is our view that the European market will have to move towards a more liberal environment. In a number of efforts pursued by my Department, and in bilateral meetings which I have undertaken with other European colleagues, we must do our best to deliver that open market as soon as possible, because our own industry is now well poised to take advantage of it.
    Mr. Darling: When considering the level of output and exports of the telecommunications industry, has the Minister discussed with British Telecom, which is a major component of the matter, the sale of magnetic tapes containing telephone directory and other information, possibly to people abroad, including fanatical religious organisations? Has he had any discussions with BT in view of the widespread concern about such possible sales?
    Mr. Butcher: That has not figured on the agenda of any discussions that I have had with counterparts elsewhere. I have noted carefully the hon. Gentleman's comments
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    and, on the face of it, I share his concern. I shall examine his comments carefully and, if necessary, write appropriately to BT.
    Mr. Michael Marshall: Will my hon. Friend take this opportunity to be a little less modest about his efforts in opening up the European telecommunications services market? Is it not the case that his Department has made some headway in getting other PTTs to agree that Mercury, for example, should have access to markets? Will he bring us up to date on where he sees that telecommunications development going?
    Mr. Butcher: Most countries in the European Community are looking closely, and some with considerable envy, at the British experience. In bilateral discussions I have found that Spain, France and the Netherlands are now ready to consider applications from Mercury for access and interconnection to such markets. I am encouraged by progress so far. It is encouraging to see that our European colleagues are interested in the sort of competition that has benefited the United Kingdom to such a great extent.

    Ballpoint Pens
    Mr. Janner: To ask the Chancellor of the Duchy of Lancaster what specific steps he has taken to ensure that ballpoint pen manufacturers comply with the recommendations of his Department's investigation into the asphyxiation of children due to the inhalation of pen tops.
    Mr. Butcher: The industry was made aware of the outcome of my Department's investigations in September 1986. In a follow-up exercise in April last year several manufacturers reported that they were working on new designs. Members of the Writing Instruments Association are also working in parallel with other European manufacturers in drawing up parameters that should be taken into account in the designs of safer pen tops. In the meantime, manufacturers and importers have been reminded of their responsibilities under the general safety requirement of the Consumer Protection Act 1987.
    Mr. Janner: Does the Minister mean that manufacturers who put out unsafe pens, as Bic has been doing for so long, are liable to be prosecuted? Is he aware that in recent years 11 children have died through swallowing pen tops? Until we get some real action from the industry, will he arrange for Bic pens with separate tops not to be available in any Government Department? Will he also talk to the Secretary of State for Education and Science and make sure that they are no longer available in or supplied to schools?
    Mr. Butcher: I congratulate the hon. and learned Gentleman on the effectiveness of his campaign and the manner in which he has pursued it. Obviously it has risen from a case involving one of his constituents, which greatly impressed my hon. Friend the Under-Secretary of State for Corporate Affairs.
    I have written to a colleague at the Department of Education and Science asking him urgently to review its practice. I hope that the hon. and learned Gentleman will be encouraged to know that, following his meeting with my hon. Friend, we have contacted the British Standards Institute to set up a committee urgently to develop a pen top standard. Furthermore, he will be familiar with the work of Mr. Mathias, in Newcastle, on outline standards

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    for pen top safety. We have also brought that work to the attention of BSI. There is much encouraging response from the industry. Rather than taking immediate and draconian measures, I hope that through other means we will achieve the effect that the hon. and learned Gentleman would wish.

    Metals Industry
    Mr. Beaumont-Dark: To ask the Chancellor of the Duchy of Lancaster what was the output of the metals industry in 1987 and in 1986.
    The Parliamentary Under-Secretary of State for Trade and Industry (Mr. Robert Atkins): The index of production for the metals industry was 110–5 in 1986 and 119 in the first 11 months of 1987, based on 1980 equalling 100.
    Mr. Beaumont-Dark: Does my hon. Friend agree that, after 20 years of going downhill in the manufacturing industry, at long last we have turned the corner? Much of the reason has been the productivity and the work of unions and employers. Would it not be a tragedy if Austin Rover, Land Rover and other companies were foolishly to follow the Ford people and try to export jobs instead of goods? Is it not time that people realised that we all—management and workers—must keep the process going so that unemployment will drop, as it is already dropping in the midlands?
    Mr. Atkins: With his usual skill, my hon. Friend has paraphrased the Government's policy on a variety of matters, although his question went a little wider than the answer.
    Mr. Crowther: In view of the significant increase in demand for British-made steel in the past 12 months or so, is the Minister having discussions with the chairman of the British Steel Corporation to ensure that, whether or not it is privatised, BSC will retain an adequate steel-making capacity to meet any further demand that may arise from, for example, a further increase in the motor manufacturing operations in Britain or from any other source?
    Mr. Atkins: We are more than satisfied, as I think most people in this country are, with the management success of the present chairman and board of the British Steel Corporation, and we intend that as a result of that success——
    Mr. Skinner: The workers; they are the wealth creators.
    Mr. Atkins: The hon. Gentleman is right: I certainly include the workers.
    As a result of that success, we are content to abide by the chairman's commercial advice about the future, as he sees it, of the corporation. That will require meeting the sorts of demands to which the hon. Gentleman referred.
    Mr. Gould: Has it occurred to the Minister that these welcome improvements have taken place in the one part of British manufacturing industry that is substantially under public ownership, and in which, accordingly, the requisite investment has been made? Can he now give a guarantee that a similar improvement will be made and sustained under private ownership? If he cannot, what is the point of privatisation, other than to hand over to the Government's friends in the City a return on investment which is rightfully that of the taxpayer?
    Mr. Atkins: The hon. Gentleman will hear more examples of good news in various other industries during
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    today's Question Time. Steel is not the only one. The hon. Gentleman forgets the criticism that was rightly levelled at the British Steel Corporation for losing up to £3 million a day in the years preceding the changes that have recently been made. He should recognise that British Steel is a success story derived from having built on and understood the changes in European and world markets. I hope that he and his hon. Friends will not continue to attack the British Steel Corporation for the changes that it has achieved.

    Dollar Export Prices
    Mr. Martlew: To ask the Chancellor of the Duchy of Lancaster what has been the increase in dollar export prices in the United Kingdom and in other Organisation for Economic Co-operation and Development countries in the latest year for which figures are available.
    The Minister for Trade (Mr. Alan Clark): In the year to June 1987 United Kingdom dollar export prices increased by 6 per cent., compared with an increase of almost 11 per cent. for the industrial countries of the OECD taken together.
    Mr. Martlew: Does the Minister agree that the rise he has described has been a major disincentive to British industry and has reduced our competitiveness? Does he agree also that, because of these policies, British industry is becoming less competitive under this Government than it was in previous times? Is that not a major reason for the crisis in the balance of payments, which showed a record deficit in 1987?
    Mr. Clark: If the hon. Gentleman has a research assistant, I suggest that he sacks him, because the facts are precisely the opposite. In fact, our exports to the United States rose by 7 per cent. in sterling terms—and by 19 per cent. in dollar terms. That was achieved against an appreciation of the currency of 14 per cent.
    Mr. Gould: Will the Minister confirm that every one of the commonly used indices of competitiveness shows a loss of competitiveness of British industry under this Government? Will he accordingly refrain from repeating the false claims made by the Prime Minister on this front, and will he advise his ministerial colleagues to do likewise? What is the point of producing Government statistics and then systematically misrepresenting them?
    Mr. Clark: With the greatest respect, Mr. Speaker, I think that you were extremely tolerant to allow the hon. Gentleman's question, which had nothing to do with exchange rates. However, I am quite prepared to tell the hon. Gentleman that I do not subscribe to the view that British exports are best served by a steadily depreciating currency. He should know that the two countries with the largest trade surpluses are those with the hardest and fastest appreciating currencies. The country with the largest deficit is the one whose currency has depreciated by one third in the past 18 months.

    Upholstered Furniture
    Mr. Canavan: To ask the Chancellor of the Duchy of Lancaster what representations he has received about new regulations on the fire safety of upholstered furniture.
    Mr. Butcher: The proposals for new upholstered furniture regulations announced to the House on 11

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    January have been generally well received. A number of firms and other bodies have raised matters of commercial concern and technical detail, which we shall deal with in the drafting of the regulations.
    An encouraging response was also received from the EC Commission, supporting our proposed action as a consumer safety measure, whilst expressing understandable concern about the need to avoid as far as possible the setting up of any barriers to trade within Europe.
    Mr. Canavan: I welcome the new regulations, but will the Minister bear in mind that an estimated 300 lives are lost every year because of the presence of killer foam and other combustible materials in household furniture? Is the Minister entirely satisfied that the proposed timetable for introducing the new regulations is adequate, in view of the likelihood that another 300 lives will be lost between now and February 1989 and a further 300 before February 1990, when the new regulations are due to come into effect?
    Mr. Butcher: I am broadly satisfied that the measures announced last month will satisfy nearly all the concerns of the House. I have a great deal of sympathy with the hon. Gentleman's argument, but he will understand that it is occasionally excruciatingly difficult to balance the paramount needs of consumer safety with a practical way of achieving them. The time frame of 1 March next year for foam and 1 March the year after for the covers is achievable. When we publish the draft regulations at the end of the month, as we agreed to do, we hope, and I think that we can fairly confidently expect, that the industry and the consumer associations will broadly welcome them.
    Mr. Conway: My hon. Friend's proposals to improve the quality of foam in furniture will be widely welcomed, but will he assure the House, first, that the quality of imports will be monitored to ensure that they meet the specifications, and, secondly, that his Department has not lost sight of the need to remind consumers of home safety, because even the higher quality foam will still be combustible and the new regulations will not solve the problem of fires in the home without individual control and responsibility?
    Mr. Butcher: I am delighted to tell my hon. Friend, and other hon. Members who have been concerned about this matter, that the regulations will bite on imports. The trading standards officers will be invited to take action on goods from wherever they come. The performance of modified foam, which could be acceptable under the test, will be continually monitored, but, having introduced the most rigorous set of regulations anywhere in the world, we should give the draft regulations a chance for the time being.
    Mr. Ashby: Does my hon. Friend appreciate that, at a time when sales should be at their highest, but are at their lowest, the industry requires certainty in respect of the regulations? Will my hon. Friend consider how to clarify the regulations so that retailers are clear about the quality of goods being sold, because at the moment nobody is certain about the regulations?
    Mr. Butcher: My hon. Friend is right. We must publish the draft regulations quickly. Ignition source 5 of BS 5852 is the test that we are minded to use on foam and we shall come to a view quickly on the direct match testing or the code of practice testing for covers.

    Compact Discs
    Mr. Simon Coombs: To ask the Chancellor of the Duchy of Lancaster what information he has on unit sales of compact discs in (a) 1987 and (b) 1986; and what value the sales represent.
    Mr. Maude: In the first nine months of 1987 the British Phonographic Industry Ltd. reported sales to retailers of 11 million compact discs—[Interruption.]
    Mr. Speaker: Order. What goes on in the Gallery is not a matter for us.
    Mr. Maude: In the first nine months of last year the British Phonographic Industry Ltd reported sales to retailers of 11 million compact discs valued at £73 million. In 1986, 8·5 million compact discs were sold, valued at £56 million.
    Mr. Coombs: Does my hon. Friend agree that those are remarkable figures, and will he join me in congratulating the work force and management of the EMI CD plant in Swindon on taking a major share of that increased growth? Does he also recognise the genuine concern within the record industry about the practice of rental and copying of CDs and the advent of digital audio tape, both of which could damage this rapidly increasing contributor to British exports?
    Mr. Maude: I willingly join my hon. Friend in congratulating those of his constituents who have contributed to that excellent record of growth in the industry. In regard to copying, I hope that those in the industry will be reassured by the rental right that the Government have introduced by tabling an amendment to the Bill in another place. That will go a long way to meet current concerns.
    Mr. Greg Knight: Will my hon. Friend resist the entreaties of those who produce compact discs and who seek a ban or other form of restriction on the import or sale of digital audio tape machines? Does he agree that such an action, if attempted, could only be described as Luddite?
    Mr. Maude: We are not persuaded that measures are desirable to prevent the importation of DAT recorders or to require them to be fitted with spoilers to prevent home taping. I take my hon. Friend's point, but a lively debate is developing on this topic.

    Paper Industry
    Mr. Moss: To ask the Chancellor of the Duchy of Lancaster what was the level of output in the paper industry in 1987 and, in 1986.
    Mr. Atkins: The index of production for the paper industry was 102.6 in 1986, and 109·1 for the first three quarters of 1987, based on 1980 equals 100.
    Mr. Moss: Does my hon. Friend agree that that represents excellent news for British industry, and in particular for the paper industry in which employment has gone up by some 11,000 in the past 18 months? Does he also agree that the prospects for the paper industry are excellent, bearing in mind the unified market in 1992?
    Mr. Atkins: My hon. Friend gives the lie to the remarks made by the hon. Member for Dagenham (Mr. Gould)

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    earlier by confirming yet again that in the paper industry, as in many others, we have a great success to show to the world.
    Mr. Malcolm Bruce: Does the Minister accept that the strong performance of the paper industry is most welcome, but will he acknowledge that there is concern within the industry about the implication of energy charges in the context of the privatisation of electricity? Will he persuade the Secretary of State for Energy to recognise the importance of keeping energy charges down to ensure that that industry will recover? Will he also make representations to ensure that when electricity is privatised, firms such as Thomas Tait in my constituency, which has made great investments to produce the right quality of paper, have the opportunity to tender for the substantial contracts?
    Mr. Atkins: As the hon. Gentleman well knows, the matter of energy cost is a matter for the Secretary of State for Energy. He must pursue that with him.
    Mr. Nicholas Winterton: May I advise my hon. Friend, that leading members of the paper and board industry—
    Mr. Speaker: Order. It is Question Time.
    Mr. Winterton: Is my hon. Friend aware that leading members of the paper and board industry are strongly opposed to the proposed removal of the Patents Office from London to south Wales, not least because that will create huge additional costs for the smaller sector of the industry and clearly could adversely affect the bid of this country to get the Trade Mark Office located in the United Kingdom?
    Mr. Speaker: Order. I am interested in this matter, but I find it difficult to relate it to the paper industry.
    Mr. Winterton: I related my question directly to the paper industry. I have received direct representations from the paper industry, which is concerned about the proposed transfer of the Patents Office to South Wales.
    Mr. Speaker: Good enough.
    Mr. Atkins: My right hon. and learned Friend the Chancellor of the Duchy will no doubt have heard my hon. Friend's question.

    Enterprise Initiative
    Mr. Devlin: To ask the Chancellor of the Duchy of Lancaster what the response has been to the launch of the new enterprise initiative.
    The Chancellor of the Duchy of Lancaster and Minister of Trade and Industry (Mr. Kenneth Clarke): The response has been excellent. We have received more than 30,000 inquiries on the DTI freephone number, and 100,000 enterprise initiative booklets have now been distributed.
    My right hon. and noble Friend and I have also received many messages of strong support from industry for the policies announced in the White Paper.
    Mr. Devlin: I welcome my right hon. Friend's initiative on behalf of the many thousands of firms on Teesside that will directly benefit from the thousands of small projects set up each month, and the doubling of research and assistance to small businesses. Does he intend to maintain the presence of the DTI in its present form on Teesside?
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    If, as has been announced, the regional development office will disappear from Billingham, will he give an undertaking to redeploy the staff elsewhere in the region?
    Mr. Clarke: The change in the nature of the services offered by our Department will obviously involve some changes in the deployment of the staff. I assure my hon. Friend that we certainly will retain a regional office in Billingham. We shall open a new satellite office in Middlesbrough. It is possible that we shall require additional personnel in the region as a whole, so long as the response is strong enough. There will, however, be some changes, because the staff previously employed in the routine checking of automatic regional development grants at Billingham will no longer be required in the same numbers. We shall look at the possibilities of redeploying them elsewhere in the region as far as possible.
    Ms. Armstrong: Will the right hon. and learned Gentleman take the opportunity to reassure those firms seeking to locate or expand in the north that the new grants and other measures which he has announced will enable them to get quickly through the bureaucracy—this reflects one of their main fears about the loss of RDG—and that the overall amount of money going into the north next year will be not less, but more?
    Mr. Clarke: We believe that the new package of grants and support that we are able to give industry in the northeast will enable us to attract new investment to the region with the same success, if not more, as we have achieved in recent years. We plan to spend more money on DTI grants and services in the regions than we planned when the last White Paper was produced. Obviously, the eventual outturn of expenditure will depend on the response of firms in the regions and those who wish to go there.
    Mr. Grylls: Is my right hon. and learned Friend aware that many people will warmly welcome the consultancy advice offered to small and growing businesses. thereby increasing their professionalism and heightening their success rate, while reducing their failure rate? Is he satisfied that the fees offered to the consultants for which the Department will look will be adequate to ensure that there is an adequate supply of consultants to deal with those firms that would like to take advantage of the services?
    Mr. Clarke: I am grateful to my hon. Friend for his first remark. The level of response from small firms throughout the country shows that we have identified a genuine need and that we can provide a valuable service. The representations that I have received on consultants fees vary, depending on the type of consultants about which one is talking. At the moment we are particularly recruiting the business advisers who will carry out the initial company audit and decide what form of consultancy is required by the company. We find that the level of fees that we are offering is getting the right sort of people to apply. The fees for the eventual consultancy will be in line with those that we have recently been using satisfactorily for our existing consultancy services.
    Mr. Salmond: How many of the messages of support have come from business consultancies which undoubtedly will be the prime beneficiaries of the enterprise initiative? Does the right hon. and learned Gentleman believe that what is good for business consultancies is necessarily good for business?
    Mr. Clarke: The messages of support have come from representative organisations of business and chambers of commerce, both north and south of the border, and from large numbers of business men, who accept the need to make our businesses ever more competitive in ways other than just price competitiveness, at which British industry is getting very good. There will be an increase in the amount of consultancy provided, but we are determined to ensure through our contractors that it is good quality consultancy that achieves the job of raising the management performance of the companies that will benefit from it.
    Mr. Holt: Referring to Teesside, will my right hon. and learned Friend reflect on the fact that, however great the Government's grants, the swingeing increase in rates by Cleveland county council by an additional 30p this year, bringing it up to 282p at county level, will negate much of the Government's good action in their initiatives? Will my right hon. and learned Friend speak to my right hon. Friend the Secretary of State for the Environment and draw attention to this terrible impost on business in that area?
    Mr. Clarke: I agree with my hon. Friend. It has been a feature in recent years that those local authorities that complain most about the difficulties of attracting new business in their areas go on to impose the highest possible rates and deter new investments. Fortunately, the Government have a proposal to introduce a national non-domestic rate across the country, which will rescue business from those local vagaries and be especially beneficial to industries in the north, in the type of constituency represented by my hon. Friend.
    Mr. Blair: Is it not the case that the welcome given by industry — certainly north of the border — has been qualified? Industry says that it welcomes the White Paper only if it will not mean a decrease in the overall level of resources. Is it not the case that the business development initiative, which is one of the main items on which the Government hang their hat when saying that they are maintaining resources, applies nationally? Will the Minister tell the House how much of the money will find its way to the hard-pressed regions of the north, Scotland and Wales, rather than to the regions that are already well off?
    Mr. Clarke: The initiative does, indeed, apply nationally, but, as the hon. Gentleman knows, we are giving a higher rate of grant to companies that apply under the enterprise initiative in the assisted areas, which include large parts of Scotland and Wales. We are determined to plan and work on the basis that we shall achieve the same level of expenditure, at least in the regions, as we have achieved in the past. Our success depends on the take-up in the areas in question. That is why we are promoting the new initiative so heavily to business men in Scotland, Wales, the assisted areas and the urban programme areas. We wish to ensure that the level of take-up is achieved, benefits produced and the level of expenditure maintained.
    Mr. Jack: Is my right hon. and learned Friend aware of the keen interest that is being shown by the Labour leader of Lancashire county council in the excellent enterprise package? To assist her in her further understanding of these exciting measures, will the Minister tell me when the DTI satellite office is due to open in
    Mr. Clarke: The new realism is affecting quite a lot of councils, although, to be fair, some of the councils in the north-west have always been fairly pragmatic and have worked with the Government in helping to promote new enteprise in their areas. I am sorry that I cannot give my hon. Friend the exact date for the opening of the new office. I rather thought that it had already opened, but if it has not, no doubt it will open in the next few weeks.

    Balance of Payments
    Ms. Mowlam: To ask the Chancellor of the Duchy of Lancaster what is his latest estimate of the deficit on the balance of payments in 1987.
    Mr. Alan Clark: The deficit was £2·7 billion in 1987. This is less than that forecast in the Financial Statement and Budget Report for the year.
    Ms. Mowlam: Will the Minister explain how we will pay our way in the world after oil, in view of the huge deficit which now exists and which is clearly soaring?
    Mr. Clark: How we pay our way. The hon. Lady may remember that all our overseas assets were sold during the war to pay the United States for armaments and raw materials. Those assets, if used now to pay our deficits each year at the present rate, would last until the 22nd century.
    Mr. Madel: If people want to improve the balance of payments in car and truck manufacture, should they not seek to persuade the trade unions at Ford to end the strike at once and start to renegotiate wages and conditions? Does that not apply particularly to the hon. Member for Dagenham (Mr. Gould)?
    Mr. Clark: One of the most praiseworthy features of our export performance has been the great improvement in industrial relations over the past two or three years. Therefore, I very much regret the dispute at Ford and hope that it will be settled very soon.
    Mr. James Lamond: Does the Minister realise that the deficit will continue to grow as long as he presides over agreements such as that reached on the import of acrylic yarn from Turkey? Was he surprised that, when he answered my question last time and lost his temper, he received a great deal of angry correspondence from the manufacturing employers in the industry, who feel that he is prepared to sit and let the industry go to rack and ruin before he accepts that the agreement is damaging?
    Mr. Clark: I did not lose my temper with the hon. Gentleman. Indeed, I have great sympathy with the case that he argues. As I have told him, both at the Dispatch Box and in correspondence—at some length, I hope he will admit — the evidence that I needed to take a different position in the negotiations began to come forward only halfway through those negotiations. If this evidence is to be accepted in Brussels, it must satisfy and conform to very strict criteria. Anecdotal evidence simply about reductions in the work force is not sufficient. The evidence must relate to falling output and falling orders and to a clearly defined set of statistics about which the industry is well aware. I had a meeting yesterday with representatives of the industry and made all that plain to them. I accept that the situation has deteriorated since the negotiations were concluded. I have asked the industry for

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    a clear statement about what is happening. When that is to hand, I hope that I shall be able to put a further process in train.
    Mr. Page: is my hon. Friend aware that in 1986–87 corporation tax was nearly £13 billion—about £9 billion more than in 1981, despite a corporation tax reduction from 52 to 35 per cent.? Given those facts, does he agree that reducing taxation gives an increase in productivity and in enterprise and leads to the largest overseas investments of any country? That is the way to close our trade gap, and no other method will succeed.
    Mr. Clark: Certainly taxation policy has a lot to do with it, but I remain convinced that other factors such as price, quality and delivery are all important.
    Mr. Austin Mitchell: Last year the deficit on manufactured trade on a balance of payments basis was about £7 billion. Ten years ago there was a surplus of about £12 billion at today's prices. Can the Minister tell us how many jobs that appalling turnround of £19 billion represents? How many jobs have been exported as a consequence? Is that not the new "jobgeld" that we are paying as tribute to Tory incompetence towards manufacturing industry?
    Mr. Clark: Unemployment figures have continuously improved over the last 14 months. The trade gap is a per cent. of our gross domestic product compared with 34- per cent. of the United States gross domestic product. I remember the hon. Gentleman and many of his hon. Friends up to about a year ago further proselytising the deficit financing policy of the United States. Look where that got the United States.

    Telecommunications
    Mr. David Nicholson: To ask the Chancellor of the Duchy of Lancaster what information he has on moves to increase competition in the telecommunications sector in the European Community.
    Mr. Butcher: The Commission's Green Paper on telecommunications, which was laid before the House on 17 July, contains a range of proposals for the development of a competitive Community market in both services and equipment. In a series of meetings with telecommunications Ministers of the Community I have underlined this objective and exchanged views on methods of increasing competition in this sector.
    Mr. Nicholson: Is my lion. Friend aware that there are still complaints about the difficulties of access to a number of national markets in the European Community? Is he satisfied that rapid enough progress is being made towards the achievement of a single common market in telecommunications equipment? Is he aware that numerous parts of Britain, including Somerset, depend for job and wealth creation on that being achieved, and that we cannot wait until 1992?
    Mr. Butcher: The short answer is no, I am not satisfied by the rate of progress. That is why I have arranged so many meetings with my European counterparts. We have all agreed that we should make the fastest possible progress towards a truly common market in telecommunications equipment. I am encouraged that the Commission's directives on the liberalisation of the terminals market borrows a great deal from British
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    experience, and that many of the principles in the Commission's Green Paper borrow very directly from United Kingdom experience. In the meantime, we must see that our companies have access to what are, in practical terms, closed markets.
    Mr. Lewis: Is the Minister aware of the concern about the growing importation from the continent of pornographic material by premium service operators of British Telecom? Many of us are fed up to the back teeth with the material that is being put out on the telephone and are sick of the "rent a knee trembler" performances that are being put out.
    Mr. Butcher: As the hon. Gentleman knows, we looked into that matter and associated issues during the Adjournment debate in the early hours of this morning. I hope that the hon. Gentleman is content that the action that the Director General of Oftel is currently taking with a considerable degree of urgency will meet some of his concerns. Both DG Oftel and BT share a number of the hon. Gentleman's concerns. We want to see fast action, but it must be for DG Oftel to implement that action, if necessary through a licence change.
    Mr. Campbell-Savours: While recognising that the Minister is not responsible for the approval of equipment that can be fitted to British Telecom lines in homes, may I ask whether he is aware that Telecom, or someone, is obstructing the approval of diverter equipment that can be used on telephone lines? It seems that that is because Telecom can gain far more by renting than by allowing people to buy. Will the Minister now look into that, make the necessary representations and clear the blockage?
    Mr. Butcher: Yes, Sir.

    Publishing Industry
    Mr. Butler: To ask the Chancellor of the Duchy of Lancaster what was the level of output in the publishing industry in 1987 and in 1986.
    Mr. Atkins: The index of production for the United Kingdom printing and publishing industries was 105.6 in 1986 and 116.3 in the first three quarters of 1987, based on 1980 equalling 100.
    Mr. Butler: I thank my hon. Friend for his reply. Is that not a remarkable tribute to the publishing industry and to the economy as a whole? I know that the policy of the Labour party is to increase choice, but with over 52,000 titles being published every year in this country, is that not a mark of the range of choice provided by capitalism?
    Mr. Atkins: My hon. Friend's general philosophy is quite right. However, I am delighted to say that he was slightly wrong in the number of titles. The number of book titles published in 1986 was 58,000, which was an all-time record and yet again evidence of a success story.
    Mr. Dalyell: To which of the hon. Gentleman's ministerial colleagues should our congratulations be sent for the boost that they have given to the publishing industry by the use of injunctions?
    Mr. Atkins: It would seem, as ever, that the lawyers always win.

    British Steel
    Mr. Morley: To ask the Chancellor of the Duchy of Lancaster what representations he has received on the proposals to denationalise British Steel.
    Mr. Kenneth Clarke: I have received a small number of letters from various parties about points of detail. I have so far received very few representations about the principle of privatisation itself.
    Mr. Morley: Is the Minister aware that there is much concern among those who are employed at BSC at the moment because no details have yet been put forward about the way in which the privatisation will take place? Is he aware that the trustees of the BSC pension fund recently announced a £41 million payout over and above their income because of the sale of part-owned BSC shares in steel companies? Will he give some assurances to the people who rely on BSC pensions that their rights will be protected?
    Mr. Clarke: We hope to publish the Bill turning the corporation into a Companies Act company shortly. Obviously, more details will begin to emerge during the debate on that. Meanwhile, I accept the hon. Gentleman's point about pension rights. It is an important matter and we shall have to reassure the employees—I am sure that we shall be able to—that their pension rights will not be affected by the change. When I have taken previous privatisation measures through the House, we have always been able to address that point successfully and I am sure that we shall be able to do so again.
    Mr. William Powell: Is my right hon. and learned Friend aware that there is widespread demand that that measure proceeds as soon as possible, and can he tell us when he expects the Bill to be published, so that the House can get on with its consideration of the details?
    Mr. Clarke: I expect the Bill to be published shortly. I advise my hon. Friend and others who are interested to wait for the business statement that follows this period of questions.
    Dr. Bray: Does the Chancellor of the Duchy of Lancaster think that the present levels of efficiency of the British Steel Corporation could conceivably have been achieved if it had been left in private ownership for the past 20 years?
    Mr. Clarke: It could have been achieved at any time by good management, with the co-operation of a good work force in making the necessary changes in working practices and the necessary investment in new plant and equipment, which British Steel Corporation has done so successfully. Now that it is such a successful corporation, there is no need for it to remain under the constraints of the Treasury and Government ownership, and we are ready to return it to the market.
    Mr. Austin Mitchell: Will the Minister state whether it is correct that he has appointed merchant bankers, brokers and account managers for the flotation? If it is correct, why could he not tell me that in his answers to my written questions, and why does he presume that the Bill will pass through the House?
    Mr. Clarke: I am not sure about the questions, which I have not handled myself. It is certainly the case that we have appointed our advisers and issued a press notice on
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    that matter. I can certainly give the hon. Gentleman the fullest details of whom we have appointed: the Government merchant bank advisers are Samuel Montagu, the Government brokers are Rowe and Pitman, and the reporting accountants are Coopers and Lybrand.

    Regional Aid
    Mr. Win Griffiths: To ask the Chancellor of the Duchy of Lancaster how much in real terms was spent on all aspects of Government regional aid policy in the financial years ended in April 1979 and April 1986 in (a) Bridgend, (b) Wales and (c) each of the standard planning regions of the United Kingdom.
    Mr. Atkins: Total expenditure in the United Kingdom at constant 1986–87 prices on the main schemes of regional assistance in 1978–79 and 1985–86 was £1,377–8 million and £784.7 million respectively. With permission, Mr. Speaker, I will arrange for the full set of figures requested to be published in the Official Report.
    Mr. Griffiths: I am sure the Minister will agree that it is absolutely astounding that at a time when unemployment was more than doubling, regional aid should have been virtually halved. Will the Government now make a commitment to reinstate regional spending in real terms so that areas with high unemployment, such as Wales, Scotland and the north, can receive an additional boost to attract new jobs?
    Mr. Atkins: For the ensuing year regional aid expenditure will be comparable with what we spent last year, albeit spread into a variety of different initiatives and regional assistance.
    Following are the figures:
    Expenditure at constant prices (1986–87=100) on the main schemes of regional preferential assistance in the financial years 1978–79 and 1985–86 in (a) Bridgend, (b) Wales and (c) each of the standard planning regions of the United Kingdom were as follows:

    £ million

    1978–79

    51985–86

    Northern

    311·1

    97·4

    North-West

    172·5

    88·6

    South-West

    18·5

    12·2

    East Midlands

    8·4

    8·6

    West Midlands

    —

    5·7

    Yorkshire and Humberside

    73·3

    35·4

    England

    583·8

    4265·8

    Wales

    2265·1

    149·1

    Scotland

    303·9

    210–0

    Northern Ireland1

    225·0

    159·8

    United Kingdom

    1,377·8

    784·7

    Bridgend

    2 362·3

    38·3

    Notes:

    Schemes included in the reply are regional developmemt grants, regional selective assistance, expenditure on land and factories by the English Industrial Estates Corporation, the Scottish and Welsh Development Agencies, the Development Board for Rural Wales and the Highland and Islands Development Board, and grants by these boards.

    1Northern Ireland has a different range of financial incentives. The items included under the expenditure data in the table are the equivalents of the schemes listed above for GB.

    2 Includes payments of £26 million to one project in Bridgend (£50.6 million at 1986–87 prices).

    3 Excludes Welsh Development Agency payments, which are not readily available.

    4 Expenditure on business improvement services and the exchange risk guarantee scheme (elements of regional selective assistance) in England in 1985–86 cannot be broken down by region. Hence the total shown for England is greater than the sum of the figures for the individual regions.

    5 Expenditure on RDG in 1985–86 was reduced by the four-month moratorium on payments under the original RDG scheme introduced in January 1985, which deferred payments into 1986–87.

    Businesses (Bureaucratic Burdens)
    Mr. Page: To ask the Chancellor of the Duchy of Lancaster what new plans he has for lifting bureaucratic burdens on business.
    Mr. Kenneth Clarke: Active work continues in every area of government to lighten the load of regulation and improve the delivery of Government services for business. We propose to issue a White Paper reporting progress and the next steps in the summer.
    Mr. Page: In thanking my right hon. and learned Friend for his reply, may I ask whether he is aware that in 1979 we had one of the most wizened and shrunken small business sectors in the Western world? Does he accept that due to the Government lifting the bureaucratic burdens it is now starting to grow? What does my right hon. and learned Friend intend to do to relieve the load on small businesses of company law, particularly on the audit facility?
    Mr. Clarke: I agree with my hon. Friend that one of the most impressive achievements of the British economic recovery has been the rate at which small businesses have set up and that sector has expanded. It is important that the Government continue to deal with small business in such a way that they do not waste management time or erect obstructions in the way of people intending to expand their business. We are now looking at several detailed proposals on company law reform and particularly aim to lift bureaucratic burdens in our changes. We have informed interested parties of the details of our intended reform of annual filing requirements for company accounts, and we are certainly giving detailed consideration to the small company audit and account requirements, to which my hon. Friend referred.
    Mr. Cryer: If lightening bureaucratic burdens on small firms is so good, why is it so good to increase them for trade unions in Act after Act? Since we lose more days every year from industrial injury than from strike action, can the Minister assure us that the proposals to remove the bureaucratic burdens on small businesses will not extend to the removal of health and safety obligations—which most small firms of any decent standard welcome—to ensure that loss of life and limb is not increased?
    Mr. Clarke: Trade unions can have their own bureaucracy, but I am sure that nothing that the
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    Government have done puts more bureaucratic restraints on them. This is a matter, not for me, but for my right hon. Friend the Secretary of State for Employment, as the hon. Gentleman knows. We are seeking to strengthen the ways in which members can enforce legal rights, which this House has provided, against trade unions which might otherwise be unwilling to concede them. That does not conflict with the other general aims of our policy. The Government have no intention whatever of reducing the standards of health and safety achieved in the British workplace.
    Dame Elaine Kellett-Bowman: I sought to be called on question No. 1 as I represent Lancaster——
    Mr. Speaker: Order. I am sorry that the hon. Lady was not called then, but she has her chance now on question 21.
    Dame Elaine Kellett-Bowman: I am now dealing with question 21, Mr. Speaker. I should like to point out that companies which come to Lancaster, despite any bureaucratic restrictions, rarely go into liquidation, because of the assistance given to them by local business men and the local city council. Anyone who comes to Lancaster will do exceedingly well.
    Mr. Clarke: That is a very welcome message for us all. It is confirmed by my experiences of Lancashire, where the co-operation between the local business leadership and the local council, and the use they make of the assistance from the Government, is very effective and is showing up very well in the recovery of the economy in that area.

    Competition Policy
    Mr. Harry Greenway: To ask the Chancellor of the Duchy of Lancaster what representations he has received in response to his recent statement on competition policy.
    Mr. Maude: My Department has received a large number of representations in the course of the recent review, and I expect to receive more in response to the proposed Green Paper on the new restrictive trade practices law, due for publication shortly.
    Mr. Greenway: Is my hon. Friend aware of the possible takeover bid for British Bakeries in my constituency? Is he aware of a move by comparatively small companies to take over large companies, which then go in for asset-stripping on a big scale, which involves job losses? What will my hon. Friend do about this wicked practice?
    Mr. Maude: Asset-stripping is a highly emotive and quite often misleading term. If any merger qualifies under the legislation, it falls to my right hon. and noble Friend to decide whether it should be referred to the Monopolies and Mergers Commission. He does that on the advice of the Director General of Fair Trading. The proposed merger to which my hon. Friend referred is, I believe, in the process of being considered by the Director General.

Hong Kong (White Paper)
3.31 pm
The Secretary of State for Foreign and Commonwealth Affairs (Sir Geoffrey Howe): With permission, Mr. Speaker, I should like to make a statement about the White Paper on Hong Kong.
A Hong Kong Government White Paper, "The Development of Representative Government: The Way Forward" was published in Hong Kong earlier today. Copies of the White Paper have been placed in the Library of the House.
The publication of the White Paper marks the end of a wide-ranging review of developments in representative government. A Green Paper, published in May 1987, sought the views of the Hong Kong community. It set out a range of options for possible change; none was ruled out in advance. The Green Paper elicited a widespread public response. We were also able to benefit from a wide range of views expressed in the House during the debate on 20 January.
The White Paper discusses the full range of issues raised in the review. The main decisions which it announces are as follows:

(a) ten directly elected members will be introduced into the Legislative Council in 1991;

(b) in 1988 the number of appointed members in the council will be reduced from 22 to 20, and the number of members elected by functional constituencies will increase from 12 to 14. In 1991, the present system of election by members of District Boards will be abolished; but the urban and regional councils will each continue to elect one member to the council;

(c) links between the urban district boards and the urban council will be strengthened;

(d) the Governor will continue to be the President of the Legislative Council for the immediate future.

We are committed to the steady development of representative government in Hong Kong. We believe that the decisions set out in the White Paper mark an important step in that direction and that they represent a balanced and reasonable response to the views expressed by the people of Hong Kong and their representatives.
Mr. Gerald Kaufman: Since the Secretary of State a week ago poured cold water on our request for a statement, we are glad that our renewed request for a statement has met with a better response today.
This is a very timid White Paper. It has been long anticipated, with considerable expectation and hope, and now that it is available it will come to many as a considerable let-down. For the most part, it does little more than tinker with the status quo.
The proposals for direct elections to the Legislative Council are distinctly inadequate. It is not simply that those elections are not to take place until 1991, rather than 1988, as many in Hong Kong campaigned for. Although I advocated 1988, I can understand, if not agree with, the Government's decision to be cautious in the light of the divisions of opinion in Hong Kong about timing. It is even more regrettable that, when direct elections are introduced, they will apply to only 18 per cent. of the Legislative Council—10 Members—rather than 25 per cent., the figure that many of us expected this year.
I cannot understand why the whole electorate of Hong Kong, whose potential number is 3,300,000, is to be given
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only 10 Members to elect when, under the new arrangement, accountants in Hong Kong—who cannot be especially numerous—are to have a Member of the Legislative Council all to themselves.
Mr. James Lamond: There are a lot of accountants there.
Mr. Kaufman: But not 330,000.
Even at this late stage, I hope that the Government will reconsider the number of directly elected Members of the Legislative Council, even if the date of the election is immutable. The Government should consider reallocating the places of the two new functional Members to the directly elected section and increasing that number to a minimum of 12. In the event of a change of Government in this country before 1991, we would discuss the feasibility and desirability of increasing the number of elected Members of the Legislative Council with the Government of the People's Republic of China.
Hong Kong can and must afford lively controversy, and no doubt there will be lively controversy there over the contents of the White Paper. However, having registered our criticism of the White Paper's contents, it is right that I should say to the people of Hong Kong that, whatever disappointment there may be, the colony is at a turning point in its history and it cannot afford deep and lasting divisions. It is essential that everyone in Hong Kong unites to ensure that the new arrangements work and are successful. I am confident that that is what they will do.
Sir Geoffrey Howe: I am grateful to the right hon. Gentleman for his modest, but appropriate, thanks for our willingness to offer the statement this afternoon. I am also grateful to him for his expression of support for the need for steadiness and unity among the people of Hong Kong. They have always manifested that, to their great credit and to the greater success of the territory.
I do not accept the right hon. Gentleman's proposition that this represents a timid decision. It is an appropriate decision in response to the very careful and full consideration given to the matter in Hong Kong. Our key objective throughout has been to design a structure that will not be temporary or fallible, but one that will endure beyond 1997. I want to make it absolutely clear that the White Paper is entirely in line with the commitments given by the Government when the matter was last discussed. No commitment was made to introduce direct elections in 1988. It is nonsense to say—as some people said earlier today—that the White Paper means the postponement of direct election plans. The commitment in 1984 was to review in 1987. We have done that.
I note what the right hon. Gentleman has said about the number of directly elected Members. However, 14 elected Members from the functional constituencies will exist alongside the 10 directly elected Members. That is close to 50 per cent. of all the Members of the Legislative Council. We believe that they will represent a proper blend of continuity and change when the time comes. I am also grateful for the right hon. Gentleman's encouragement to the people of Hong Kong, after their mature reflection that has brought us this far, to continue to sustain the constitution in the way in which we would all wish.
Sir Peter Blaker: Is my right hon. and learned Friend aware that the decision to introduce an element of direct elections to the Legislative Council in

357
1991 will be welcomed by the majority of Conservative Members and, I believe on the evidence, by the majority of people of Hong Kong? Is he also aware that BBC radio news reported this morning that the Government of Hong Kong and this Government have gone back on an undertaking to introduce an element of direct elections in 1988? Will he make it perfectly clear that no such undertaking has ever been given?
Sir Geoffrey Howe: I am grateful to my right hon. Friend for his commendation of the decisions announced. I am grateful to him also for giving me the opportunity to set beyond doubt the fact that those reports had no foundation. As I said in my earlier answers, there was no commitment beyond that to undertake a review, and there is no foundation for the suggestion that we have gone back on any commitment. It is very important that that proposition should be nailed now and nailed firmly.
Dr. John Marek: Is the Foreign Secretary aware that he has caused considerable disappointment and a sense of betrayal among a large section of the Hong Kong community? Is he aware that democracy demands tradition and roots and that that implies a move to direct elections this year and a majority of elected members by 1991? Is he aware that his lame statement and his sell-out will make the eventual transition of Hong Kong in 1997 harder rather than easier? Finally, is he aware that it is a very risky course that he wishes to pursue in the next few years?
Sir Geoffrey Howe: The intemperance of the language used by the hon. Gentleman, with phrases such as "sellout", puts the value of his judgment in the right perspective. There is no case for such emotional and inaccurate phraseology, nor is there any suggestion that the Government are proceeding with undue caution. We have proceeded, as we have always advertised here, along an evolutionary rather than a revolutionary line, on the basis that each step should be carefully considered and that changes should command wide support and confidence in the community. What we said in the last White Paper is what has been said in this White Paper: these changes, after full consideration of all the views expressed, are well judged to command wide support and confidence and to ensure continuity, which is the foundation of stability.
Mr. David Howell: Further to the comments of my right hon. Friend the Member for Blackpool, South (Sir P. Blaker) about the BBC, is my right hon. and learned Friend aware that the report this morning also stated as a bland fact that the decisions about elections had been made in deference to Beijing? Will my right hon. Friend take every step to see that that nonsense is flatly refuted? Will he stongly underline the commitment, in his own words, to the steady development of representative government in Hong Kong? Will he confirm beyond all doubt that there is no going back on the spirit and aim of the 1984 accord or on our very strong determination and commitment to see Hong Kong flourish as a free-enterprise society for many decades ahead?
Sir Geoffrey Howe: I am grateful to my right hon. Friend for what he has said. He rightly drew attention to the importance of the joint declaration between the United Kingdom and the People's Republic of China. One of its
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provisions, designed to ensure the stability and prosperity of Hong Kong, was the proposition that the legislature of the Hong Kong special administrative region shall be constituted by election. That is the direction represented by the changes which I have announced today.
It is wrong to suggest that the decisions we have announced today are decisions of anyone other than ourselves. Clearly we have taken account of the wishes of the people of Hong Kong. Clearly some of those people themselves have wished to take account of the development that has taken place on the Basic Law which is being prepared by China. All these matters are important to the continuity which we want to achieve. That continuity is designed to secure the survival of Hong Kong as a prosperous, stable, free enterprise society in accordance with the joint declaration.
Mr. A. J. Beith: Is the Foreign Secretary really suggesting that direct elections earlier than 1991, and of a larger proportion of the legislature, would be revolutionary? If it is not he who thinks that, is it Beijing that thinks so, and has he received representations to that effect? What chance does he see for establishing two systems in one country if the democratic system is not firmly established in Hong Kong before the changeover?
Sir Geoffrey Howe: The hon. Gentleman must come back to reflect on the pattern that prevailed in Hong Kong until the first steps were taken in the direction of representative government only a few years ago. What is now proposed is a substantial and important further step in that direction. The mood of the people of Hong Kong was rightly expressed in the last White Paper, when it was noted that there was considerable general public concern that too rapid progress towards direct elections could place the future stability and prosperity of Hong Kong in jeopardy.
In summary, there was strong public support for the idea of direct elections but little support for such elections in the immediate future. That was the position a couple of years ago. Against that background, we have announced today the introduction of direct elections in 1991 and made it clear that we think that that is the right pace at which to proceed.
Several Hon. Members rose—
Mr. Speaker: Order. I hope that the I-louse will think it fair if I now give preference to those who were not called in the debate on Wednesday 20 January.
Hon. Members: Hear, hear.
Mr. James Couchman: Is my right hon. and learned Friend aware that the White Paper will be seen widely as an elegant compromise between the apprehensions of the traditionalists, who have viewed direct elections with considerable concern, and the more radical and adventurous section of the community that wanted direct elections much more swiftly and for a much greater proportion of seats? My right hon. and learned Friend will be aware that timetabling the introduction for 1991 shows a much greater grasp of the realities involved in trying to arrange direct elections in a hurry than those who wanted the introduction in 1988?
Sir Geoffrey Howe: I am grateful to my hon. Friend. We have striven to balance the two factors to which he has drawn attention. As a result, we will have contributed to the prospect of continuity, stability and prosperity.
Mr. Jack Ashley: Will the Foreign Secretary recognise that, if he does not think that the statement is timid, some talented and energetic people in Hong Kong will think it is, and that it will provide impetus to their wish to emigrate? To avoid that danger, will the Foreign Secretary accept and tell our friends in China that the higher the proportion of seats that become directly elected, the greater the prospect for stability and progress in Hong Kong?
Sir Geoffrey Howe: I have no doubt that the right hon. Gentleman is correct to say that there are some talented and energetic people in Hong Kong who disagree with the conclusions I have announced. That was implicit in the question asked by my hon. Friend the Member for Gillingham (Mr. Couchman). We have striven to reach an answer that provides the best balance between all the opinions expressed and the anxieties felt in Hong Kong. I believe that that will prove to be the basis for continuity and stability of the system of government and continuity on the path towards and through 1997. believe that it will prove to be the best way of retaining in Hong Kong the largest quantity of talent of the sort the right hon. Gentleman has in mind. It is a matter of judgment. I respect those who argue in the opposite direction, but I think that we have struck the right balance for the future.
Mr. Roger Sims: Is my right hon. and learned Friend aware that many hon. Members consider themselves friends of Hong Kong and that many of us will feel that the proposals, although we understand the mixed views about them, are in the best interests of the people of Hong Kong and the territory's future? Is he aware that it was only a few years ago that a number of people from Hong Kong were seeking advice from us as to how they should move forward to representative government? Indeed, the first elections were held only two and a half years ago under the functional constituency system—an ingenious device that seemed particularly appropriate for Hong Kong and appears to have worked successfully. Can my right hon. and learned Friend confirm that the number of functional constituency seats is to be increased forthwith and that there will still be functional constituencies alongside directly elected Members after 1991?
Sir Geoffrey Howe: I am grateful to my hon. Friend for his tribute to the balance of the conclusions we have reached. He is right to point out that it was only recently that moves were made in the direction of representative government against the historical background of Hong Kong. He is right to draw attention to the importance of the functional constituencies. The change that is taking place as a result of my statement today will take effect by the addition of 10 directly elected seats and a continuation of the functional constituencies in 1991.
Mr. Pat Wall: Does not the Secretary of State's statement mark only a further extension of the long process of denying the Chinese people of Hong Kong a say in the running of their lives, both in relation to the rightful reunification with China and to the social and economic conditions in the colony? Does that not show that the Government have more in common with one-party totalitarian Stalinism than they have with democracy throughout the world?
Sir Geoffrey Howe: I dare say that, if I wanted advice about one-party Stalinism, I should turn to the hon.
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Gentleman. I can assure him that the pattern of development in Hong Kong, the security that has been provided for the people of Hong Kong and the framework within which there has been an explosion of prosperity on a massive and demonstrative scale are a tribute to the free enterprise system which has underlain it and to the framework of government that has brought it thus far. The changes that we are making now are, in themselves, a further extension of the novelty of representative government which the hon. Gentleman appears to commend. I cannot see why he should complain about our movement in the direction of an increasingly democratic, free-enterprise society.
Mr. James Hill: My right hon. and learned Friend will be aware that we have heard a great deal about the lobby for 1988. I was recently on a private visit to Hong Kong, where I found that there were several other opinions, particularly in the business community. That community was looking forward to stability after the difficulties with the stock exchange and the devaluation of the Hong Kong dollar. It would have been a most inopportune time to bring forward a sweeping political change. My right hon. and learned Friend must have taken all that into account in the decision making that had to take place. I should have thought that today's decision was the right one, but I hope that my right hon. and learned Friend will say something about the timetable of the Basic Law; we cannot have democratic elections without a Basic Law. There must be tremendous cooperation with the Governor of Hong Kong and the Chinese authorities.
Sir Geoffrey Howe: My hon. Friend draws attention to another of the strands of opinion in Hong Kong, which emphasises the extent to which there are sharp divisions and variations in opinion there. That is one of the strong arguments for not making a major constitutional change in 1988, when opinion is divided in this way, but for proceeding along the timetable that he has commended.
My hon. Friend is also right to draw attention to the importance of the role of the Basic Law. As I have already said, the preparation of that is for the Government of the People's Republic of China, but it is being undertaken with the help of a Basic Law drafting committee on which Hong Kong people are well represented. I understand that the full text of the draft Basic Law will be formally published after refinement in May of this year and that Hong Kong people will then have four months to comment on it, before it is revised further. That other half of the equation is being carried forward quite sensibly.
This pattern of behaviour underlines the extent to which there is a fallacy in some people's thinking—that a choice must be made between the interests of Hong Kong and good relations between Britain and China. The truth is that we cannot have one without the other, and we are endeavouring to achieve both.
Mrs. Gwyneth Dunwoody: Is it not clear that only when directly elected Members are in place will they have the authority to speak on the basis of democratic representation? Does it not ill become a Government who are supposed to be committed to democracy to say to other people, "You must wait for the system that we shall put in place and it will be only a short time before the final changeover takes place."?
Sir Geoffrey Howe: If life were that simple, what the hon. Lady says might be true. But life is not so simple. In making those changes from a system of government which has prevailed in Hong Kong, placed as it is historically and geographically, we are moving in the direction that she would wish, after the fullest possible consultation with the people concerned, on a time scale consistent with balance and continuity. We have done the best we can to take account of the diversity of opinion. With all humility, I believe that we have got the judgment about right.
Mr. Robert G. Hughes: Does my right hon. and learned Friend accept that there will be a wide welcome in Hong Kong for the calm and considered way in which he presented his arguments today? Does he accept also that there will he some disappointment at the fact that there will be no direct elections in 1988? Does he agree that there will be some concern that what he has said today may not be the best way in which to ensure stability? Does he accept that there will be puzzlement about the fact that the small scale of what is proposed for 1991 falls short of the expectations not only of those who want direct elections this year but of those who are hostile to direct elections at any time?
Sir Geoffrey Howe: I have no doubt that my hon. Friend articulates the opinions of some people on the matter — I emphasise: some opinions of some people. We have made the best judgment that we can on the basis of an extensive survey and on the basis of debates in every conceivable representative institution and authority in Hong Kong. In almost all of them, as in the House, opinion was pretty evenly divided between both ends of the argument. The judgment that we have struck is as near right as one could get.
Mr. Dennis Skinner: Is the Foreign Secretary aware that it will not be lost on the British electorate that the Government who are handing over Hong Kong are the same Government who fought for the Falklands? They will be drawn to the irresistible conclusion that, whereas the Government were prepared to fight for the Falklands, they dare not do anything with Hong Kong because there are 1 million Chinese around the corner? [Interruption] Sorry-1 billion Chinese around the corner. There will be only 18 per cent. participation in the elections. The Government are demanding that trade unions, tied hand and foot, must ballot for everything. Eighteen per cent. would not do service to the Iowa caucus. Before long, the hon. and right hon. learned Gentleman, if he is still in the job, will make arrangements for a one-party state in Hong Kong.
Sir Geoffrey Howe: The people of this country will learn from the hon. Gentleman's intervention that, if they seek one of the longest possible interconnections of wholly unconnected topics, founded upon a wholly misleading over-simplification, they have no better champion of that type of behaviour than the hon. Gentleman.
Mr. Tim Rathbone: Dos my right hon. and learned Friend accept that the mixture of direct representation and functional representation is an intriguing experiment in proportionality? Does he consider that it bears particular study by her Majesty's Government?
Sir Geoffrey Howe: I am not quite sure in what respect that kind of sophisticated proportionality is to be
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commended. It might be commendable for the future tribulations of the parties that once constituted the alliance.
Mr. Alex Carlile: Does the right hon. and learned Gentleman agree that the existence and popular expectation of representative government will do much to strengthen prospects for Hong Kong's institutions in 1997? Does he expect evolution to be speeded up a little between 1991 and 1997?
Sir Geoffrey Howe: The pattern of development that has so far been identified seems to commend itself to the people of Hong Kong. We shall look forward to their experience in operating it when we consider the prospect for any further changes.
Mr. Nicholas Soames: I congratulate my right hon. and learned Friend on achieving a judicious and skilful balance in his paper. Will he reassure the people of Hong Kong that it patently shows that we have absolutely no need to suck up to the People's Republic of China?
Sir Geoffrey Howe: The idea that Britain should be obliged to have a confrontation with the People's Republic of China or be obliged, in my hon. Friend's elegant phrase, to "suck up to" the People's Republic of China is an unusually uncharacteristic over-simplification, of which my hon. Friend is not often guilty.
Dr. Jeremy Bray: Is the right hon. and learned Gentleman aware that he has weakened the authority of, and undermined confidence in, the Government of Hong Kong by so palpably bowing to pressures from the People's Republic of China in a matter in which that country has no legitimate interest and which relates entirely to a period long before the handover?
Sir Geoffrey Howe: I am sorry to tell the hon. Gentleman that his view is dramatically over-simplified and foolish. As I said in the last debate on this matter, and again today, all the evidence shows that Hong Kong prospers when London and Beijing can work in harmony. The overriding need for Hong Kong is to secure a foundation for lasting future stability and prosperity. That cannot be founded on confrontation between Britain and China; it can be founded, as it sensibly has been, on a continued understanding and the implementation of the joint declaration, to which we are both committed.
Mr. Michael Marshall: Does my right hon. and learned Friend accept that the whole future of Hong Kong—like its past—is based on its economic viability, which in turn is based on confidence? Is not the greatest threat to confidence in Hong Kong ill-considered statements urging on it a Westminster model, as some hon. Members have done, and as has been heard in some of the extreme statements of the Members of LegCo?
Sir Geoffrey Howe: I am sure my hon. Friend is right to remind the House of the importance of confidence as a foundation for stability — above all else — in Hong Kong. One of the remarkable things is the extent to which the people of Hong Kong and their representatives have, to a large degree, appreciated that, as is shown by the moderation and wisdom of what they say. That is a proposition that should be borne firmly in mind by Members of LegCo, this House and all others NA ho are concerned to uphold prosperity, stability and continuity in Hong Kong.
Mr. Andrew Faulds: Will the right hon. and learned Gentleman accept my reassurance that I think that he has got it just about right — which can only mean that the Prime Minister's uninformed intervention has not been allowed to play upon this particular matter? Is not the blunt fact that the major considerations up to 1997 must be both the maintenance and success of Hong Kong's economy and the realisation that we must go along with the Chinese Government's acceptance of the scale and speed of change?
Sir Geoffrey Howe: I am always glad to accept a compliment from the hon. Gentleman, however much it may be accompanied by the thorns that he sometimes feels obliged to offer at the same time. He puts his finger on it precisely when he says that the future must be built on exchanges and understandings of the mutual interest of the United Kingdom, China and the people of Hong Kong. If what we are building now is to be stable and survivable, it needs to be built in that way.
Several Hon. Members rose——
Mr. Speaker: Order. I will call the four hon. Members who have been standing, to put their questions briefly.
Mr. Ivan Lawrence: As any lingering doubt that my right hon. and learned Friend may have had about the good sense of his policy will have been confirmed by the support of the hon. Member for Warley, East (Mr. Faulds), and as everyone — including the People's Republic of China—is agreed that Hong Kong should have direct elections, why should they not be held as widely and as soon as possible if the tender seed of democracy is not planted until 1991? It may not be strong enough to withstand any of the winds by 1997.
Sir Geoffrey Howe: The tender seed of democracy was first planted in the form of indirect elections as recently as 1985, and the judgment that we have formed is that to make a further change with the addition of direct elections only three years after that will be to hasten the process of maturation too quickly. I recognise that it is a matter of judgment. I do not think it would be easily possible to produce a conclusion that commended itself to the enthusiastic support of my hon. and learned Friend and, simultaneously, of the hon. Member for Warley, East (Mr. Faulds)—but I have to try my best.
Mr. Bowen Wells: Will my right hon. and learned Friend accept that the selection of a six-year period for partially elected representational government, instead of the nine-year period that was available to him, brings into question whether there is enough time to establish and experience representative government on a firm basis through direct elections, in
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addition to the ministerial system which must still come? Will he carefully consider his fine judgment of today and reflect on whether he ought not to speed up that process?
Sir Geoffrey Howe: The arguments advanced by my hon. Friend are perfectly legitimate. I do not want to let him think, however, that we are likely to embark on a reconsideration of this matter. The important thing is to proceed with this next step, to get the process under way on a settled basis.
Mr. Alastair Goodlad: Does my right hon. and learned Friend accept that his statement today will be broadly welcomed in Hong Kong and that it reflects the vast majority of the voices that spoke in the recent debate about the need for continuity and a measure of caution in these arrangements? As the right hon. Member for Manchester, Gorton (Mr. Kaufman) said, the people of Hong Kong will make the new arrangements work, and they will have the full support of this House in so doing.
Sir Geoffrey Howe: My hon. Friend's experience of the people and colony of Hong Kong lends great authority to his observations. I am glad to endorse and accept them.
Mr. Robert Adley: Thank you, Mr. Speaker, for giving me the last word.
Is it not a fact that, for more than a century, stability and autocracy have gone hand in hand in Hong Kong? Is there not a degree of illogicality in the words of those who say that the best way to maintain stability is fundamentally to change the system as a matter of urgency? Is there not also a certain illogicality in the proposition advanced by the Opposition Front Bench that, on the one hand, the document and the future discussions up to 1997 should be based purely on decisions taken in this House, as though the People's Republic of China did not exist and, on the other, to say, as did the right hon. Member for Manchester, Gorton (Mr. Kaufman), that if there is to be a change of Government before 1991, the first thing that he will do is to consult Beijing? Is my right hon. and learned Friend aware that most people think that he has got it right?
Sir Geoffrey Howe: I thank my hon. Friend very much for that closing tribute. The least likely problem to affect the future of the people of Hong Kong is the prospect of the election of a Labour Government in the United Kingdom.
Mr. Tam Dalyell: On a point of order, Mr. Speaker.
Mr. Speaker: I shall take the application under Standing Order No. 20 first.

Heart Operation (Leeds)
4.7 pm
Mrs. Alice Mahon: I beg to ask leave to move the Adjournment of the House under Standing Committee No. 20 for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the postponement today of a desperately needed heart operation for two-year-old Jason Pullen from Halifax, who is awaiting surgery in Killingbeck hospital, Leeds."
The matter specifically relates to Jason, whose operation has been cancelled today. It is urgent because the child could die if he does not have the operation soon. It has had to be postponed four times because the hospital, whose staff are working under enormous pressure, cannot cope with the demand for cardiac surgery.
Only six of the 12 intensive care beds are in use, because the hospital cannot afford to employ enough skilled nurses to staff the rest of them. The surgeon, Duncan Walker, knows that life-saving operations are being restricted because of lack of funds, and he recently warned:
"increasing numbers of both children and adults will die on increasingly long waiting lists unless bottlenecks caused by lack of intensive care beds are relieved."
The doctors and nurses at Killingbeck have raised £300,000 for intensive care facilities and they are asking only for funding to staff them. The region does not have the money to do so, because the Government have persistently refused to staff the unit adequately. Staff are being put in an impossible position; in the words of the consultant:
"It is a matter of fact. We are not speculating. People are now dying on our waiting list."
Babies who are stable for the moment have to make way for acute emergencies, which often arise because those babies have been waiting too long on the waiting list.
Will Jason Pullen have to wait for his operation until his condition has so deteriorated that he is such an emergency himself, or will the Government give a commitment today that they will make sufficient funds available to end this dreadful lottery of who shall live and who shall die?
Mr. Speaker: The hon. Lady asks leave to move the Adjournment of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that she believes should have urgent consideration, namely,
"the lack of beds in the intensive care unit at Killingbeck hospital, resulting in the cancellation of heart surgery for Jason Pullen for the fourth time."
I have listened with concern to what the hon. Lady has said. She knows that the only decision that I must take in looking at an SO 20 application is whether to give it precedence over the business set down for today or tomorrow. I regret that I cannot find the matter she has raised appropriate for discussion under Standing Order No. 20, and cannot therefore submit her application to the House.

Points of Order
4.10 pm
Mr. Tam Dalyell: On a point of order, Mr. Speaker. Within your hearing at Question Time, the Chancellor of the Duchy of Lancaster said that there would be a business statement after he had completed questions. What we had in mind was a business statement to explain how 60 tonnes of metal fell off a ship in the Mull of Galloway, and that metal was the bow of Trident——
Mr. Speaker: Order. I did not hear the hon. Gentleman ask a question about that during Question Time. I thought that his question had a rather different drift. My recollection is that the Chancellor of the Duchy of Lancaster said that that there would be business questions tomorrow.
Mr. Dalyell: The Chancellor of the Duchy of Lancaster might have had in mind some kind of explanation of how an extremely expensive part of the Trident submarine, somehow put on the deck of a Bahamas-registered ship, falls off the deck into the Mull of Galloway. We have it in print, and it has been cross-checked, that the Navy is now staking out the Mull of Galloway in order to try to prevent anybody else, such as the Russians, finding this exceedingly valuable, highly technical, sophisticated part of the Trident submarine.
Should not the House be told how an enormously expensive part of Trident comes to fall off the deck of a ship? Who had the idea and notion of strapping part of Trident to the deck of a ship, despite the gale warnings, which then falls into the sea, at heaven knows what expense—
Mr. Speaker: Order. I am sure that this is an important matter, but it is not a matter of order for me. I suggest that the hon. Gentleman pursues it in a different way. I should have thought that it would make an admirable Adjournment debate.
Dr. Jeremy Bray: Further to that point of order, Mr. Speaker.
Mr. Speaker: It is not a point of order.
Dr. Bray: The steel in question was undoubtedly on its way from my constituency to Barrow and was made by the British Steel Corporation, to which the Chancellor of the Duchy of Lancaster's statement specifically related—
Mr. Speaker: Order. This is an extension of Question Time, for which we have already had a full hour. The hon. Gentleman could have raised this matter on the question on steel, but it should not be pursued now.
Mr. Pat Wall: On a point of order, Mr. Speaker. I hope that I am in order to raise a matter in relation to the request made by my hon. Friend the Member for Halifax (Mrs. Mahon) about Killingbeck hospital. Four weeks ago in this Chamber I asked the Prime Minister about Killingbeck hospital and I was assured that everything would be fine. In that four weeks, the situation has become worse, and we should have a debate on that issue today.
Mr. Speaker: If the hon. Lady is successful in obtaining such a debate, the hon. Gentleman can join in.
Mr. Dennis Skinner: On a point of order, Mr. Speaker. You will have noticed that, since my hon. Friend the Member for Linlithgow (Mr. Dalyell) raised his

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point of order about the storm last night and the bit of Trident dropping off into the sea, and the fact, about which you were a bit uncertain, that the Chancellor of the Duchy of Lancaster had said that there would be a business statement today, the Leader of the House has turned up. He obviously thinks that it is business questions today. We know that the Government had a bad shock last night which they have not got over. It is just conceivable that half the Government Treasury Bench thinks that it is Thursday. Will the Leader of the House let us have a statement about the important matter—more important than handing over Hong Kong to the Chinese—referred to by my hon. Friend?
Several Hon. Members rose— —
Mr. Speaker:Order. I can confirm that it is Wednesday. If we go on like this, we shall be taking today's business into tomorrow.
Mr. Eric S. Helfer: On a point of order, Mr. Speaker. I am aware that it is Wednesday because in Liverpool today the North-West TUC has called a great demonstration— [HON. MEMBERS: "What is the point of order?"] If hon. Members give me time, I shall come to that.
The North-West TUC has called a great demonstration throughout the north-west, including Liverpool, in relation to the problems of the National Health Service and those who work in it and their effect on the patients of the NHS. Since thousands—I mean thousands—of ordinary people will be demonstrating, and are demonstrating at this moment, in Liverpool, Manchester and elsewhere in the north-west, may we have a debate on the future of the NHS along the lines referred to by my hon. Friend the Member for Halifax (Mrs. Mahon)?
Mr. Speaker: That is a Standing Order No. 20 application without notice, upon which I need not comment.

BALLOT FOR NOTICES OF MOTIONS FOR FRIDAY 26 FEBRUARY
Members successful in the ballot were:

Mr. Gwilym Jones

Mr. James Couchman

Mr. John M. Taylor

Statutory Instruments, &c.
Mr. Speaker: With the leave of the House, I shall put together the three motions on the statutory instruments.
Motion made, and Question put forthwith pursuant to Standing Order No. 101 (3) (Standing Committees on Statutory Instruments, &c.).
That the draft Statistics of Trade and Employment (Northern Ireland) Order 1988, be referred to a Standing Committee on Statutory Instruments, &c.
That the draft Drug Trafficking Offences (Enforcement in England and Wales) Order 1988, be referred to a Standing Committee on Statutory Instruments, &c.
That the Homes Insulation Grants Order 1987 (S.I., 1987, No. 2185) be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Lightbown.]
Question agreed to.

Credit (Control)
4.16 pm
Mr. Elliot Morley: I beg to move,
That leave be given to bring in a Bill to control the rate of interest charged by credit card companies by linking it to the rate recommended for borrowing by the Bank of England: to prohibit the making of inducements designed to promote excess borrowing by credit card users: to prohibit the charging of arrangement fees for consolidation and other forms of loans: to provide for clear written examples of what the APR means in financial terms and warnings for any loan scheme that may involve the loss of a house as part of the loan security conditions: and to make other provisions as to regulating such borrowing.
The Bill seeks to tackle the growing debt crisis in our society and recognises that much of the recent consumer boom has been financed on credit. Credit can be a useful and valuable option, but many families are paying a price for that credit in the misery of a spiral of debt that hangs round their necks like a chain.
It is time that some of the issues raised by such a credit expansion were brought out into the open. I have been motivated to introduce the Bill by my case work experience and the growing number of people who are turning to organisations such as the citizens advice bureaux and the money advice centres, locally and nationally, for help.
There is no limit to interest rates in Britain. I was shocked recently to be involved in a case in my constituency of a woman in her eighties. She was concerned about her electric and domestic bills and was unwell and vulnerable. She entered into a credit agreement with a finance company that charged her 1,000 per cent. APR interest.
On top of that, the lady was also charged for an insurance policy for redundancy even though it must have been clear to the agent who sold the policy that it was completely useless. I was able to obtain a refund for that lady, but, in the process, she died. There is no doubt that the stress of those loans added much to her ill health.
Loans at rates such as that are perfectly legal in Britain, but can they be justified? It is time that we had a maximum legal limit on consumer credit interest in Britain.
Initially, the Bill sought to tackle the many complaints that have been brought to me about the rate of interest being charged by bank and shop credit cards and the fact that when bank interest rates have fallen, the interest rates for credit have hardly moved. Those are two of the main facts that have led me to introduce the Bill.
Let me summarise the Bill's main proposals. First, it seeks to introduce a formula that will link all credit card interest rates, shop and bank, to the average bank personal loan lending rates, in a way that will allow credit card companies some flexibility, but will put a ceiling on the excessive interest rates being charged by some credit cards, particularly store cards.
Secondly, the Bill proposes to prohibit the marketing of credit cards by schemes that reward users with gifts according to the amount they spend on those cards; thirdly, it would ensure that all credit agreements print examples of repayments on money borrowed in cash terms as well as the APR; fourthly, it would make illegal the charging of arrangement fees for loans; fifthly, it would

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ensure that all credit agreements that require the use of a person's home as security have a clear written warning that such schemes can lead to a loss of that person's house.
I should also like to suggest that all consumer credit organisations pay a levy from their profits to finance a chain of money advice centres, possibly incorporating existing ones, and the advisory role of the CAB that will enable anyone in Britain to get impartial debt advice.
Consumer debt in Britain has risen from £17.3 billion in 1980 to £41 billion in 1986–87, a figure that accounts for 10.7 per cent. of our total GDP. More than 2 million default summonses were issued in 1985, in the first quarter of the past financial year lending increased by 32 per cent., and there was a staggering 77 per cent. increase in credit card borrowing. That is the scale of the problem—all the more so when the interest rates of the two main credit cards have been on average at least 14 percentage points above the bank lending rate. The Government have considered that there is enough concern to refer credit cards to the Monopolies and Mergers Commission.
I seek to prohibit the marketing of credit cards by schemes which give gifts through accumulating points by spending on credit cards. The more one spends, the more points one gets. Although the introducers of the scheme associated with Barclaycard are aware of the dangers, at the very least such a scheme means that in effect those with debts are subsidising the richer users who get the gifts that are paid for by all the users. If credit card companies want to increase their market share, they should do so by marketing on reduced interest rates rather than by such schemes.
Since I announced the Bill, I have been contacted by a large number of organisations and individuals, and my attention has been drawn to the fact that many credit organisations at the shadier end of the market are capitalising on the misfortune of those who get into debt. Those consolidation loans often require a person's house as security, and may mean that people end up owing more money than they owed when they started. In some cases people are charged up to £2,000 in arrangement fees. When a credit firm is making a profit on interest repayments, there is no justification for such fees, and I propose that they are banned as soon as possible.
I also want all credit schemes that involve using the home as security to print a written warning in a prominent fashion so that people entering into such schemes are left in no doubt that such a schemes could lead to the loss of their homes.
According to a Marplan poll commissioned by the National Consumer Council, less than half the people questioned knew how APR was calculated. To make sure that people understand exactly what is being charged, I am therefore proposing that all credit agreements should give examples in cash terms of the monthly repayments and the total cost of the loan as well as the APR.
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There are a great many issues of concern about consumer credit in Britain. Other proposals are needed in addition to those in the Bill, to deal with such issues as the way in which advertising by some credit companies is aimed particularly at those who are already in debt, and low-paid store assistants are given financial bonuses to get more customers on to their store credit card.
It is fair to say that many credit companies are responsible and reputable and are aware of all the points that I am laying out in the Bill, but can the range of credit card interest in Britain — from 19.5 per cent. of John Lewis to the nearly 40 per cent. of Dixons—be Justified?
Has the number of people suffering from debt been underplayed by a Government who wish to portray consumer booms as an economic miracle of their making? When one considers that on current estimates over half those on social security have some form of debt, does that not raise questions about the introduction of loans to replace single payments under the new social fund that is due to be introduced in April, and the effect that that will have on people who already have debt problems, partly due to the issues that I have outlined?
Although the Bill is designed to obtain a fairer deal for people on all incomes, from the highest to the lowest, as always it is the poorest and weakest in our society who carry the greatest burden. The poor and the low-paid carry the greatest debts as a proportion of their incomes. As the gap between rich and poor continues to grow, the Bill gives the Government the opportunity to tackle some of the injustices and abuses of consumer credit, to ensure fairer interest rates, and to lift the burden in particular from those whose lives are being destroyed by the misery of debt and the unscrupulous who prey upon them.
Question put and agreed to.
Bill ordered to be brought in by Mr. Elliot Morley, Mr. Alan Meale, Mr. Gerry Steinberg, Ms. Marjorie Mowlam, Mr. Rhodri Morgan, Mr. Paul Flynn, Mr. Paul Murphy, Mr. Eric Illsley, Mr. Dennis Skinner, Mr. Paul Boateng, Mr. John McFall and Mr. Alun Michael.

Credit (Control)
  CREDIT (CONTROL)
  Mr. Elliot Morley accordingly presented a Bill to control the rate of interest charged by credit card companies by linking it to the rate recommended for borrowing by the Bank of England: to prohibit the making of inducements designed to promote excess borrowing by credit card users: to prohibit the charging of arrangement fees for consolidation and other forms of loans: to provide for clear written examples of what the APR means in financial terms and warnings for any loan scheme that may involve the loss of a house as part of the loan security conditions: and to make other provisions as to regulating such borrowing; And the same was read the First time; and ordered to be read a Second time upon Friday 8 July and to be printed. [Bill 94.]
Orders of the Day
  Employment Bill
  As amended (in the Standing Committee), further considered.
  Employment Bill
    Clause 13

      REQUIREMENT OF POSTAL BALLOT FOR CERTAIN BALLOTS AND ELECTIONS
      4.26 pm
      Mr. Michael Meacher: I beg to move amendment No. 10 in page 16, line 40, (Clause 13), at end insert—
      'except where it is reasonable for the union to believe, and it does believe, that a ballot conducted under the terms of section 3 of the 1984 Act would result in a substantial increase in the number of members participating in the ballot by comparison with a ballot conducted entirely by the postal method.'.
      The amendment seeks to allow a trade union, where it is reasonable if it believes that a workplace ballot would result in a substantial increase in participation compared to a purely postal ballot, to be entitled to use the workplace ballot.
      Clause 13 as drafted will oblige unions to hold ballots for a political fund and for elections to the principal executive committee by postal ballot only. Our main objection to the clause is that there is no reason to suppose that postal ballots are inherently more democratic than are workplace ballots, or a combination of the two systems. Indeed, there is a great deal of evidence to the contrary.
      Research produced by John Leopold in the Industrial Relations Journal last year, when he carried out work in regard to the political fund ballot that had recently taken place, reached the following findings. The average turnout in 38 unions using the workplace balloting method was 30 per cent. higher than the average for unions using the postal method. Only one union using a postal ballot achieved a turnout of more than 50 per cent., while only two unions using workplace ballots had turnouts of fewer than 50 per cent.
      It is notable that those findings were not seriously disputed in the Green Paper. Chapter 5.13 of the Green Paper tacitly accepts that many unions will achieve better turnouts with workplace ballots than with postal ballots. Paragraph 5.13 merely claims, rather feebly:
      "workplace ballots cannot guarantee a higher turnout".
      Of course, no one claims that they can. We merely argue that one reason unions should be free to choose them is that they tend, in almost every instance, to produce higher participation. Since the Government always talk about choice, how about a bit of choice for trade unions?
      Paragraph 5.13 lets the cat out of the bag. It says:
      "even if … workplace ballots do produce higher turnout levels they are not without … serious disadvantages."
      The rate of participation that most people would think was central to democracy is not the vital issue for the Government. They are happy to see the turnout reduced by clause 13. In many unions it would be reduced by up to one third. What concerns the Government so much?
      Paragraph 5.13, which we discussed at considerable length in Committee, gives two examples of workplace
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      ballots which have allegedly led to manipulation. The first, and most significant, is the Transport and General Workers Union general secretary election, which was rerun after an investigation by John Garnett of the Industrial Society found some irregularities. I point out that those irregularities were in fewer than 0.1 per cent. of the branches, or fewer than one in 1,000, but that is not something that we should ignore. Indeed, we do not.
      Mr. Garnett did not find sufficient evidence of abuse to warrant a re-run. In fact, the union took the decision only after the personal intervention of the successful candidate, Mr. Ron Todd. The best that the Green Paper can make of this case — far and away the most important case that it cites—is that it suggests
      "a need for more secure electoral arrangements."
      Of course, the Opposition agree, and so does the Transport and General Workers Union. That is why the union, without any prompting, tightened up its procedure between the first general secretary ballot and the second, going considerably further than Mr. Garnett had recommended.
      Does the Minister seriously believe that postal ballots are not, in theory at least or in practice, open to just as much abuse as workplace ballots? In Committee I quoted to the Minister, but he never answered the point—we should like an answer—the words of the right hon. Member for Bridgwater (Mr. King), when Secretary of State for Employment in 1985. On 23 April he said:
      "I understand from the research that, in a fully postal ballot conducted by the AUEW … 200,000 members never received a vote and 20,000 received a vote to which they were not entitled." —[Official Report, 23 April 1985; Vol. 77, c. 775.]
      Mr. Eric S. Heifer: Does my hon. Friend agree that the best voting method in the trade union movement was followed by my old union, the Amalgamated Society of Woodworkers? Every quarter it had what was called a star night. If a member did not attend, he was fined. Voting took place on the star nights.
      The chairman of the branch called out the names of those who were standing for election and they were recorded. They were then checked by the secretary and the members. After the vote had been taken and collected nationally, the national executive issued a form which showed the number of votes for each candidate. The number could be checked, because it was in print, by every member of the branch and the union.
      There was nothing wrong with that democratic process. It was far better than leaving it in the hands of some people dealing with ballots by post, which could be rigged. The Government have changed that voting method, which was a good democratic practice. Of course, the Government supposedly know better than the democratic practices of unions.
      Mr. Meacher: My hon. Friend makes a valid point. More than one method can seriously be considered. It is arguable—I agree with my hon. Friend—that existing methods, even on the Government's criterion of protection from abuse, are better alternatives than what the Government insist on, and they achieve a higher turnout.
      Dame Elaine Kellett-Bowman: Does the hon. Gentleman agree that the only way a postal ballot can be rigged is if the union officials who are sending out the ballot forms cook them? Does the hon. Gentleman agree

      373
      that there is no possibility of putting pressure on people when they receive the vote at home but considerable pressure can be put on people voting in the workplace?
      Mr. Meacher: The hon. Lady is a great deal more naive than I thought if she believes that postal ballots are not open to great interference by, for example, editorials in The Sun and the other Tory tabloids. They insist on having a full opportunity to interfere in union ballots. They have always done so, not least in the National Union of Mineworkers. I suspect that that is the prime reason why the Government insist on this method.
      Mr. Dennis Skinner: Is my hon. Friend aware that workplace ballots take place on a fairly big scale in the House of Commons? In 1975, when the present Prime Minister was elected leader of the Tory party after she beat the previous Prime Minister, the right hon. Member for Old Bexley and Sidcup (Mr. Heath), a workplace ballot took place in the House of Commons among members of the Tory party, almost certainly including the hon. Member for Lancaster (Dame E. Kellett-Bowman), who wants some other form of ballot for trade unionists. They all took part. The hon. Lady probably voted for who knows? She probably squealed at the top of her voice as well while she was doing it.
      The Government have double standards: one thing for them, another for trade unionists. They have just announced another ballot some time in the future for the Chinese in Hong Kong. The percentage vote will be 18 per cent.—about as much as an Iowa caucus.
      Mr. Meacher: My hon. Friend has a point. I suspect that Tory Members are opposed to a postal ballot for themselves because most of them have two or more houses and it would not be clear to which the ballot was supposed to go.
      Dame Elaine Kellett-Bowman: On a point of order, Mr. Deputy Speaker. Do not the rules of the House provide that Members who live, as I do, in a constituency 250 miles away from this honourable House and are proud to do so, must also live somewhere in London? Why be so derogatory about that? The hon. Member for Oldham, West (Mr. Meacher) says that we have two houses. Do not Opposition Members get precisely the same facilities?
      Mr. Deputy Speaker (Mr. Harold Walker): That is not a point of order.
      Mr. Meacher: The only further argument which has been advanced in the Green Paper for clause 13—Ministers leaned heavily on this argument in Committee—is that there is
      "scope for subtler forms of pressure in a workplace ballot"
      and
      "there is a real question whether such ballots can ever be totally free from suspicion."
      I am sure that the House will take note of those words in the Green Paper. Despite the paranoia of the hon. Member for Lancaster (Dame E. Kellett-Bowman), the Green Paper offers not a shred of evidence to justify that assertion. That is not especially surprising. We are now leaving the realms of reason and entering the dark areas of conspiracy theory which always lurk deep in the Government's collective psyche. Faced with this, perhaps the Opposition should offer counselling, because I do not think that we shall be able to convince by reason alone.
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      What the Government regard as subtle pressure a rational person might regard as the legitimate and wholly democratic attempt by the union and its members to secure by persuasion a vote in line with the union's declared policies. In other words—I say this especially to the hon. Member for Lancaster—if it is blustering editorials in The Sun trying to influence a postal ballot, it is legitimate pressure; but if it is talking with other people at the workplace and other union members and activists, it is illegitimate and dangerous brainwashing. We condemn such utter rubbish.
      Mr. David Madel: Would the hon. Gentleman explain his case further? Clause 13 states that an individual trade unionist can
      "have a voting paper sent to him by post at his home address or any other address which he has requested".
      There is nothing to stop a trade unionist asking for his ballot paper to be sent to his place of work. He has the choice. Therefore, if he is worried that his ballot paper will get lost in the post, he can use that provision to overcome the problem.
      Mr. Meacher: The hon. Gentleman is being extremely ingenious, and it sounds as though he is being rather defensive on the Government's behalf. Clearly the purpose of a postal ballot is to ensure that one is sent the ballot paper and can deal with it in the privacy of one's home. The number of workers at a given workplace who would take the initiative to ensure that ballot papers were sent to them at the workplace would be negligible, although I suppose that technically it may be an option. The hon. Gentleman should not use jesuitical arguments to wriggle out of the Government's clear intentions in the clause.
      Quite apart from the number of members participating, there are real practical difficulties in requiring large unions to conduct postal ballots. Let me give an example. The largest union — the Transport and General Workers Union—has an extremely diverse membership employed in various trades by literally tens of thousands of employers. There are about 1.3 million members in 8,500 to 9,000 branches. The members are employed not only in travelling occupations these include long-distance lorry drivers, coach drivers, air crew and travelling construction and agricultural workers—but at sea, in trawlers and lighthouses and on oil rigs and construction sites.
      Furthermore, the union has a membership turnover —and I say this in answer to the question of the hon. Member for Lancaster about the post—of about 20 per cent. a year, or about 25,000 members a month. That is why the TGWU would have difficulties with postal ballots. —[Interruption.] If the hon. Lady wishes to make a speech on the matter, she can. I see the Minister pulling a face at the suggestion that his hon. Friend might make a speech, and I can understand that.
      The co-ordination of elections, even with the central register of members that unions are required to collect under the Trade Union Act 1984, is a complex matter for large unions such as the TGWU. They require at least the degree of flexibility afforded by the Government's own previous anti-trade union Act—the 1984 Act—which is being taken away by the clause, if they are to ensure that every member is given a reasonable opportunity to take part in the democratic life of the union. Clause 13 as drafted will make that impossible. Perhaps that is what the Government intend, and that is precisely why we strongly oppose the clause.

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      Our case is simple. In our view, the participation rate is probably the single most important democratic criterion for a ballot. Workplace ballots fulfil that criterion to a far higher degree than postal ballots. That is why trade unions should be given the choice to adopt the most suitable ballot for them.
      Mr. David Winnick: The clause is another illustration of Government interference in the internal affairs of trade unions. I speak with some experience. The hon. Member for Lancaster (Dame E. Kellett-Bowman) was shouting while my hon. Friend the Member for Oldham, West (Mr. Meacher) was speaking, but I am not sure that she is a trade unionist.
      Dame Elaine Kellett-Bowman: As a matter of fact, I am.
      Mr. Winnick: In that case, it will be interesting to know what part the hon. Lady has played in her trade union. For example, does she ever attend a branch meeting?
      Dame Elaine Kellett-Bowman: Yes.
      Mr. Winnick: Frequently?
      Dame Elaine Kellett-Bowman: Yes.
      4.45 pm
      Mr. Winnick: I find that difficult to believe, and I would like some evidence from the hon. Lady that she knows what she is talking about.
      I know what I am talking about. In a previous debate, I told the House that I am a national officer of my trade union, of which I have been a member for more than 30 years. I was an active member from day one.
      I saw nothing wrong in the method used by unions, including mine, of conducting internal elections by the branch system. I did not consider it undemocratic. Ever since we came into existence 97 years ago, we have had elections. That may surprise Conservative Members, because they have not had much experience of democratic organisations. It took years and years for the Conservative party to get round to electing even its leader. The first such election was in 1965.
      There is no election for the position of chairman of the Conservative party. His election is decided by whoever happens to be leader of the party at the time. That is why we make a valid comparison between the way in which the Communist party in the Soviet Union operates and the way in which the Conservative party operates.
      I do not know whether the Communist party in the Soviet Union wants to lecture us on how to conduct our affairs, but the highly non-democratic organisation that now governs the United Kingdom certainly wants to lecture us and to pass legislation governing trade unions, which have always held elections. We did not have to be pressurised into holding elections. I challenge the House to name me a single trade union that did not hold elections from its inception. I certainly do not know of one. I am sure that the Minister will tell us if he has any such information.
      My union is APEX—the Association of Professional, Executive, Clerical and Computer Staff. I have often strongly disagreed with its policies, but those policies are decided at the annual conference. If I disagree with them, I campaign, as I have done over the years, for different policies. I have sometimes succeeded and sometimes not.
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      I was elected to the executive as a result of campaigning; at first I did not succeed and then I did. But I could not for the life of me see what was wrong with the branch system,.
      Each year I would go along to the annual general meeting of my branch, where genuine elections took place. We would discuss the names to be nominated and ask each other, "What do you know of him or of this?" Two months later, when people had been duly nominated, we would have another branch meeting to decide how to cast our vote. We might spend 15 or 20 minutes on a particular position such as president or vice-president. Differing views would be expressed——
      Dame Elaine Kellett-Bowman: Will the hon. Gentleman enlighten us as to the proportion of members who attended those meetings?
      Mr. Winnick: That is an interesting question——
      Dame Elaine Kellett-Bowman: Answer it.
      Mr. Winnick: I shall reply to the hon. Lady, whose question I should have anticipated. In all honesty, I must say that it was not a large number of people, but the branch meetings were open to anyone who was a member and they could not be held on an authorised basis if a single member had not been notified beforehand of the proceedings. Anyone who wanted to could turn up. We would have a 15 or 20-minute discussion to decide whether X or Y or A or B should be given our vote. We would have a general discussion about those people's qualities.
      The Government decided to go beyond that and have workplace ballots. As I have already said, there is an argument for the branch method, but given the choice between a workplace or postal ballot, I think that far more people are likely to participate in a workplace than in a postal ballot. My union is in the process of having a postal ballot; the votes have to be in by next Monday. I would imagine, although I could be wrong, that the percentage of members voting in the current elections in my union on a postal ballot basis will be far smaller than the percentage of members who participated two years ago in the workplace ballot. I very much doubt that I shall be wrong.
      The hon. Member for Lancaster asked about the number of people that attend branch meetings. If the argument is that participation should be extended so that more people are involved, the point made by my hon. Friend the Member for Oldham, West was valid. If more people are likely to vote in a workplace than in a postal ballot, the workplace ballot is surely preferable. However, the important point is that the matter should be decided by the union. Some unions, including my own, prefer a postal ballot and that is a matter that the union executive and conference should decide.
      In a democratic society, unions should not be dictated to. We know how Governments operate in dictatorships. Despite nine years of Thatcherism, I am glad to say that, in essence, this is still a democratic society. In such societies, trade unions should be able to conduct their own affairs.
      Mr. David Lightbown: Hear, hear.
      Mr. Winnick: One of the Government Whips, the hon. Member for Staffordshire, South-East (Mr. Lightbown) says, "Hear, hear." In a previous debate on the Bill, I made a sedentary intervention to the effect that some

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      Conservative Members were involved in businesses that did not recognise trade unions. At that time, the hon. Gentleman nodded his head. We know that when hon. Members are appointed to the Government, they have to give up their shares and their directorships.
      When the hon. Gentleman was conducting a business, no trade union was allowed to operate. Moreover, I imagine that the firm in which the hon. Gentleman was involved in a leading way would have victimised trade unionists if they had tried to organise their employment. So let us not have any lectures about democracy from the Conservative party when so many Conservative Members are directors of firms in which trade unionism is not allowed.
      I have not the slightest doubt that this modest amendment will be defeated. If the Government are not willing to listen to reason on other matters, they will not listen to reason on this. It is nauseating to see trade unions being lectured day in and day out by an organisation such as the Conservative party, which does not believe in democracy in its own internal affairs.
      The Minister is not sympathetic to Mr. Eric Chalker. Hon. Members may wonder, "Who is Eric Chalker?" I can tell hon. Members that he runs an organisation called the Tory Reform Movement, which is putting forward modest proposals. It believes, for example, that the chairman of the Conservative party should be elected. Surely there is nothing revolutionary about that. However, I imagine that if the Minister were lobbied by the Tory Reform Movement and by people such as Mr. Eric Chalker, he would show no sympathy whatever.
      The Minister is not at all interested in democracy in the Conservative party and is the last person to lecture trade unions about how they should conduct their affairs. Trade unions have always been run on democratic lines. The members of trade unions are mere human beings and when occasionally there have been allegations of ballot rigging, the matter has been decided by a court. One type of ballot rigging, which I or my hon. Friends would be the last to defend, was decided against the people responsible, and rightly so, in the early 1960s in a court of law. As I say, trade unions do not require lectures about democracy, least of all from the Conservative party.
      Mr. Madel: I have two questions to ask. One of them has been partly answered by the hon. Member for Walsall, North (Mr. Winnick) because he spoke about the opening words of amendment No. 10:
      "'except where it is reasonable for the union to believe, and it does believe'".
      I take it from what the hon. Gentleman said that when he spoke about "the union", as does the amendment, he meant that the members of the union will take the decision under amendment No. 10 about whether they want a change in the way in which the voting is carried out.
      I take it that the amendment does not mean that that decision will be made just by the general secretary or the executive council of the union but that it is the union members themselves who will vote on whether they wish to have a ballot system other than that laid down in clause 13. If it is the members of the union who will vote on that, then that is a perfectly reasonable starting point.
      My second point is the one that I made in an intervention during the speech by the hon. Member for Oldham, West (Mr. Meacher) who said that my point was jesuitical. I do not think it is. Clause 13(1) says that a
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      voting paper can be sent to "any other address" that the individual member requests. It is perfectly reasonable for that other address to be the union member's place of work. If it is, it is up to employers to make sure that, if the voting paper goes to the place of work, it is easy for the employee to pick up the ballot paper and vote.
      I take the point made earlier, that members of the Transport and General Workers Union have many different sorts of jobs. There are long-distance lorry drivers and people working at sea and on lighthouses, and on occasions such people would want the ballot papers sent to the place of work. When the Minister is winding up, will he confirm that line 30 of clause 13(1) means that "any other address" may be the place of work? If it goes out from the House that it can be the place of work, I expect employers and managers to respond in a positive way and to make sure that it is easy for each employee to have his postal ballot paper sent to his place of work and to record his vote in the way he chooses.
      Mr. Heffer: I joined my trade union 50 years ago, and when I joined it I found that it was a very democratic organisation. I joined the Hertford and Ware branch of the union and the branch chairman was a distinguished local JP. He was portly, wore a bowler hat and a fob watch, and always came to branch meetings. He was a distinguished member of the local community.
      Our union meetings were totally democratic. The only other branch of the union that I have ever been in was the Huyton branch just outside Liverpool. In the branches to which I belonged, there was always total democracy. As I said earlier, when we had a ballot for union officials or to decide any other issue, it was conducted in a most democratic fashion. Members who did not attend the branch meeting on the 'star' night when the elections took place, were fined. It was made absolutely clear that every member of the union should attend when there was to be an election for the appointment of a local official, a district committee or, in our area, a management committee, national officers or district or full-time officers.
      Under the Government's policy, we know that if union members are fined by the union they can go to the court and be recompensed for not voting on democratic matters. We believed that it was important for people to vote and to attend branch meetings for elections to union positions, and I regard that as absolutely democratic. The chairman of the branch read out the names of all the people who were standing for election and they only stood if they had a minimum number of nominations from a number of branches.
      The meeting was told that there were so many votes for George—I almost said George Brown, but he was not in my union. There might be five people standing and the votes for each of them were recorded. Every union member had a right to put down on a piece of paper the number of votes that were cast for each candidate. The details were sent to the national executive and a list was sent by them to each branch showing the votes that were recorded for each candidate. That meant that, if the votes did not tally, that if some branch official tried to swing the vote, every union member could see that and could say, "Hang on, that is not accurate," and the matter could be raised. That is democracy. That is what we grew up with in my trade union. It was always like that.

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      5 pm
      When we had an issue such as a wage demand in the Liverpool area, we used to have a great aggregate meeting at which all the members of every branch in the area were called together. We used to use the Liverpool stadium. The negotiators would come together to explain to the members what they had been able to achieve for the membership. If the membership did not like it and said, "That is not good enough," they would vote it down at the meeting. The negotiators then had to go back to the employers and say, "Our membership is not having it," and they would have to discuss it again. If, in the last analysis, the membership said that it was not good enough and the employers said no, a ballot would be taken there and then in the branches and we would then take strike action throughout the entire area. To me, that has always been the basic democratic principle.
      However, that changed once the union became part of the Union of Construction and Allied Trades Technicians. It was changed by the new people who began to organise UCATT, and who brought various unions together. However, after a period, the membership said no and the union reverted to the democratic election of officials.
      Nobody needs to tell our movement about democracy. We grew up with it. We created it and we fought for it. Over the hundreds of years since our movement was formed, some of our members have died or have been sent to Australia in chains because they fought for democracy in this country.
      We do not need any lectures about democracy from this Conservative Government. In fact, the Government have consistently been the people who have restrained democracy in the country. Over the years, the Conservative party has fought every effort to improve the democratic rights of the people. Therefore, we do not need any lectures.
      My hon. Friends have tabled a reasonable and, if I may say so without being insulting — I think it is right — a moderate amendment. I would have gone much further. However, it does not make any difference whether the amendment is moderate, because the Government steamroller over everything, whether it is moderate, Left-wing, hard Left, soft Left or anything else. It does not make any difference because, if it is democratic, the Government steamroller over it. That is the Government's attitude.
      Although the Government are saying to the unions, "Go back to the membership," I advise them that we never needed to go back to our membership; we are the membership and have always been the membership. We have always encouraged our people to participate totally in the life of our unions.
      We do not need to be told about democracy. As union members, if we want changes, we have things called rules revision conferences. Every few years we change our constitution. We do so by going back to the members who vote. If the members want to change to a postal ballot, that is their decision. It is not a decision for the Government — it is the members' right. When the Government impose that on union members, they are being authoritarian.
      Although I know that, in a sense, I am unfortunately talking to the wind, I ask the House—[HON. MEMBERS: "Not on this side."] No, not on this side, but unfortunately I am talking to the wind as far as Conservative Members are concerned. In any case, the quicker we get television
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      in here, the better. Look at all the empty Benches, including our own. When we are discussing a matter of great importance for democracy in this country, hon. Members are not here. To me, such matters mean more than anything else because we are talking about the rights of ordinary working people who have always fought for democracy, supported it and died for it. That is the point about our people.
      Those who fought and died in the last war were not all members of the Conservative party. When I was a member of the Royal Air Force, I spoke in Banbury on the eve of a general election poll. I said then that to listen to the Tory party, one would think that Mr. Churchill had won the war on his own. What had the rest of us been doing? We all fought that war for democracy. We all fought against Nazism. That is why the late Harold Macmillan made the point that the miners, the dockers and the others who fought for democracy were our people.
      We have nothing to be ashamed of. We are the ones who have consistently fought for democratic rights in this country. We do not need any lessons from the Conservative party. If hon. Members are honest about democracy, they will vote for my hon. Friend's modest proposal.
      Mr. Graham Allen: Clause 13 is not quite the full-frontal attack on democracy that clause 3 was on Monday. However, the greatest insult that I can muster is to say that it runs it damn close. This clause contains a distillation of one of the key facets of Tory party policy —hyprocisy. It is hypocritical because the Tory party and the Government seek to corner the key words, the buzz words of "democracy" and "freedom". Their arguments have been exposed in Committee. However, on this occasion the buzz word is "choice" because if there is one thing that the clause does, it is to remove from 10 million trade unionists the possibility of choice in the way in which they conduct their elections.
      It is important that, in moving the amendment, we make it clear that it is we in the Labour party who seek to restore choice to trade unions, against the Government who seek, by clause 13, to remove the possibility of choice. It is important to place one or two facts on the record. I had the privilege of serving in a national campaign related to political funds, in which all the unions did not follow one view. They chose many different ways in which to express their wish either to retain or not to retain political funds.
      Some unions chose workplace ballots—for example, the Society of Graphical and Allied Trades, the Iron and Steel Trades Confederation, the Union of Communication Workers, the National Communications Union, the General, Municipal, Boilermakers and Allied Trades Union, the Association of Professional, Executive, Clerical and Computer Staff, the Power Loom and Carpet Weavers and Textile Workers Union, the Ceramic and Allied Trades Union, the Transport and General Workers Union, the Confederation of Health Service Employees, the National Union of Tailors and Garment Workers, the National Union of Domestic Appliances and General Operatives, the National League of the Blind and Disabled, the National Union of Footwear Leather and Allied Trades, the National Graphical Association, the Transport Workers Union, the National Association of Colliery Overmen, Deputies and Shotfirers, the Amalgamated Union of Engineering Workers-TASS, the

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      National Union of Public Employees, the National Union of Mineworkers, the Fire Brigades Union, and the Scottish Carpet Workers Union.
      All those unions chose, of their own volition, a workplace ballot, which was carried out under the tight rules under which unions must administer their ballots and, in addition, the even more scrupulous and tighter rules that were put forward by the Government's own Trade Union Act 1984.
      Other unions exercised their choice in a different way and, by and large, chose to go for a postal ballot system. They include the Furniture, Timber and Allied Trades Union, the Amalgamated Union of Engineering Workers-EFC, the Electrical, Electronic, Plumbing and Telecommunications Union, the National Union of Seamen, the National Union of Scalemakers, the Association of Cinematograph, Television and Allied Technicians, the Rossendale Union of Boot, Shoe and Slipper Operatives, the Musicians Union and the Union of Construction and Allied Trades Technicians. All exercised their choice in that way.
      The one outstanding facet of those ballots, other than the fact that all those individual unions won their political fund campaign, was the turnout—the ability of people to turn out to vote for the unions in those nationwide ballots. It averaged out that 69 per cent. of those who could have voted did vote when it was a workplace ballot, but in postal ballots the average was 39 per cent. across those unions.
      We are not being selective with figures. They are for national ballots held in 40-odd different trade unions. The figures stand the test. Clearly, a turnout of less than two thirds of the turnout possible under a workplace ballot was achieved by postal ballots. That is not to dismiss postal ballots. Trade unions have different circumstances and should be able to decide, but postal ballots produced a lower turnout.
      The Government are saying, "We shall decide how you will ballot in future." They say to all those unions that have decided to use a workplace ballot, "I am sorry, but we are imposing on you a postal ballot, so the likely reduction in your turnout will be one third." The aggregate for the whole trade union movement will be 3 million, so 3 million working people will be robbed of the ability to cast a vote in key elections or in political fund campaigns. That degree of disfranchisement by the Government is unprecedented.
      Indeed, in the past decades the Government have been loth to extend the franchise. It has taken about 100 years to force them to allow working people to have the vote in general elections to choose their Government. Even now, they are not content to maintain that position and are reducing the ability of trade unionists to vote in key elections.
      Mr. Patrick McLoughlin: No.
      Mr. Allen: The hon. Gentleman does not agree, but I ask him to reconsider the figures, which cannot be contraverted.
      The Government may come unstuck. The average percentage of people voting for a political fund in workplace ballots was 83 per cent. and in postal ballots it was 80 per cent. That is little difference, given the degree of national campaigning that went on. The Government,
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      who are bad losers and took a right pasting in the political fund ballots, may well not achieve the outcome that they wish from changing the rules.
      This legislation will not change an Act brought into being by a Labour Government or one of the revolutionary steps attributed to my right hon. Friend the Member for Blaenau Gwent (Mr. Foot), who is accused of giving things away to trade unions. The legislation that is being changed was laid on the statute book by a Conservative Government in 1984. The Government are unpicking their legislation just four years after it reached the statute book. In 1984, the Government tried to murder the ability of trade unions to defend themselves politically and to campaign, but the system did not deliver All the ground rules are up for grabs again and there will be change.
      This reminds me a little of the great affinity of the alliance, particularly the SDP, for postal ballots. The Government have now taken on postal ballots in their entirety and to the exclusion of any other form of balloting, as, indeed, the SDP sought to do. For the Government, just as for the SDP, these postal ballots are not an advance of democracy; they are a device for reaching their ends by different means. The Government will ditch postal ballots, just as Dr. Death, the right hon. Member for Plymouth, Devonport (Dr. Owen), ditched them when they did not produce the results that he wanted. This is a farce. It is a fallacy to say that this is democratic and allows union members a choice, because it does not.
      We have heard about corruption in ballots. The grossest ever corruption in trade union ballots is about to be perpetrated by the Government who will disfranchise thousands of people who would vote in a workplace ballot but who for some reason cannot vote in a postal ballot. On a re-run of all the political fund ballots, up to 3 million trade unionists may lose their ability to vote.
      5.15 pm
      As I said in Committee, this must be the largest vat of sour grapes ever trampled by the Government for having been hammered by 40-odd trade unions in retaining their political funds. The fact that the Government are had losers is writ large. This is just the latest in a long line of attacks on the political funds of trade unions, stemming from the Trade Disputes and Trade Unions Act 1927. It is not that the Government have dreamed up something new. They thought that they could bend the rules in 1984. They even set the question—trade unions were not allowed to set the question—yet they could not win. They specified how the unions must ballot, but they could not win. The Government have had every possible advantage and the trade unions, by a united campaign, turned that round into victory.
      Because of the fear that the Government engender in trade unionists, not only were the political funds held, but the insurance workers—not a radical or revolutionary bunch of people—set up a political fund; the teachers in Scotland have been radicalised and set up a political fund; post office clerical workers and even the tax men have set up political funds. In some perverse way I thank the right hon. Member for Chingford (Mr. Tebbit) for his foresight in introducing these political ballots. The nurses and other groups may be next.
      There has been no obvious demand for this change. The Government are introducing it on the basis of dogma. The

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      certification officer received seven complaints—up to 10 million trade unionists were balloted in this exercise—in the first year of the political fund ballots and five complaints in the second year. He received 12 complaints out of a possible 9 million, so there is no demand. The Bill, particularly this clause, has been introduced because of dogma alone. It is undemocratic and hypocritical. I hope that if it is not defeated tonight or in the other place, it will be the first clause to be repealed when we are returned to government.
      Mrs. Llin Golding: I support the amendment but, like my hon. Friend the Member for Liverpool, Walton (Mr. Heffer), feel that it does not go far enough. The same applies to this as to many other parts of the Bill: the matter should be for the unions to decide. It should be for the unions to determine how voting takes place.
      What is the Government's justification for allowing the stock exchange, but not trade unions, self-regulation? The Minister has said that the unions must be controlled because of their power and influence. If that is the criterion, what of political parties? Should not their affairs be regulated by law? Does the Tory party intend to have a postal vote for elections or will it stick to conferences? Is it somehow different when it involves the Tory party rather than trade unions? Will hon. Members vote by post for the Tory chairman, or will he or, indeed, she, be appointed? Is the argument that Conservative Members and the Conservative party chairman are less important than union officials of a lower rank than president or general secretary? Are they less important than the chairman of the Conservative party?
      Some unions like postal ballots. It makes sense when they have scattered membership. The last union ballot I participated in was with NUPE when I was branch secretary. We had three sorts of ballots. The first was a workplace ballot, where the members were informed with information which was readily available, then had discussions; then the union hired ballot booths from the local authority and set them up, the same as in the general election, and the members went in to vote in secret. That is how they organised it themselves, without anybody telling them to do it. The second method was by post, sent out by the union to members' homes. The response to that method was lower, but not considerably lower.
      The third method was for me as branch secretary to deliver a vote to members' homes, to people such as caretakers who could not get to the workplace to vote. If the hon. Member for Lancaster (Dame E. Kellett-Bowman) were still in the House, she would hear that postal ballots are delivered to members' homes and the person says, "Hello, Llin, come in and have a cup of tea." I would admire the garden, and then we turn to the vote, and they say, "Which way do you want me to vote?" As a good trade unionist, I would say, "Do what the executive recommends," or, "Have you read the leaflets?" or, "I think this, that or the other." Postal votes are influenced, and that was made clear to me as branch secretary when I went out to talk to members. It is there to be seen, and the Government are wrong in thinking that postal votes are not influenced.
      It is for the union to decide where the membership should vote and how best to conduct it. Democracy
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      consists of discussion, information and then voting. That is what we do in general elections and that is what happens in workplace ballots at all workplaces. It does not take place in postal ballots. In any case, it is easier to put pressure on people through postal ballots. Every Member of Parliament knows that calling to see somebody with a postal vote and having a little chat always pays dividends, because not only can the candidate put one side of the argument and dismiss the other side of the argument, but he does not have to argue both sides of the argument, as happens at work when people are airing their different opinions.
      In the workplace, many views are voiced and members decide after listening to those views. The workplace vote generates a higher turnout because of greater informed interest, whereas the postal vote is often left on the mantlepiece. Small, well organised political groups can go around to houses with postal votes and put pressurre on people and influence the vote. It has occurred that pressure has been brought to bear on people in branches, and I would not like to see that perpetuated.
      The Government, in preferring postal ballots to workplace ballots, have given way to the views of people without any practical experience at all. They have had no experience of trying to get members to take up their democratic rights. Members do not sit there waiting for the postal vote to drop through the letter box; someone must go to them to get them to vote and use the rights which have been won for them, often after a long and bitter struggle.
      I understand that the Government are obsessed with postal voting because they think it will lead to a more secure electoral arrangement, but what is the use of a union having such a secure electoral system that members do not participate? Each union should decide on the best method for getting its members out to vote; it is not for the Government to decide.
      Mr. Roger Knapman: Like the hon. Member for Nottingham, North (Mr. Allen) I am also concerned for disfranchised groups, but the clause is one of the jewels in the crown of this excellent Bill—but does it go far enough? There are still some underprivileged and potentially persecuted groups—disfranchised groups—which are urgently in need of the protection provided by the clause. One such group, admittedly of declining importance and reducing numbers, is sponsored by trade unions. My hon. Friends and I fully understand what they say and why they must say it.
      Opposition Members are fond of leafing through the Register of Member's Interests, so it comes as no surprise to find that the hon. Member for Oldham, West (Mr. Meacher) is sponsored by COHSE, so we understand his remarks, and the hon. Member for Birmingham, Ladywood (Ms. Short) is sponsored by NUPE.
      Mr. Allen: Will the hon. Gentleman give way?
      Mr. Knapman: No. The hon. Gentleman has been begging me for months to make a contribution in the debate, and I am doing my best to intercede with the Minister on his behalf. The hon. Member for Fife, Central (Mr. McLeish) shares that distinction with NUPE.
      Ms. Clare Short: Will the hon. Gentleman give way?
      Mr. Knapman: No. The hon. Lady has also asked me many times——
      Ms. Short: The hon. Gentleman has referred to me.
      Mr. Knapman: Very well.
      Ms. Short: The hon. Member does not understand what trade union sponsorship means. It means a link with a union for which one has political sympathy. In the case of NUPE, it represents many very low-paid women, typical of the women who live in my constituency, and I am proud to work with NUPE for the interests of those workers. I get no financial contribution of any kind for that work, and the hon. Member should understand that. Just because his hon. Friends take those kinds of jobs for large sums of money, he thinks that we are the same, but he will find that that is not so.
      Mr. Knapman: I understand from the hon. Lady that the relationship between hon. Members and their unions is very slight, but I suggest that Conservative Members understand why they say what they say.
      Mr. Bob Clay: I want to say a little more about the potential inadequacies of secret ballots, and to try to disabuse Conservative members of the notion that, other than the concession they have made that there is sometimes a poorer turnout, there is absolutely nothing else wrong with the proposition.
      Mr. Winnick: I missed the speech of the hon. Member for Stroud (Mr. Knapman) because I went to check in the Register of Members' Interests what involvement he has with trade unions. Is the hon. Gentleman aware that the hon. Member for Stroud has listed himself as a partner in R. J. and R. M. Knapman, builders, and a member of a Lloyds underwriting syndicate? Would my hon. Friend find it of some interest to know whether the firm in which the hon. Member is involved allows employees to be members of trade unions, whether trade unions are recognised, and what sort of internal democracy—postal ballots or otherwise—takes place in Lloyds underwriting syndicates?
      Mr. Clay: One of the colleagues of the hon. Member for Stroud (Mr. Knapman), who is on the Standing Committee, had a different job every time he stood up to speak. Apart from his job here, he has been a management consultant for a building firm, like the one just referred to, and he had some other job. Goodness knows what sort of balloting went on there. The hon. Member for Stroud never spoke in Committee, to my recollection, so we never had the opportunity to raise those matters with him until tonight. I do not know whether he wants to respond to the question my hon. Friend has asked me—I cannot give the answer. He is sitting down; he obviously has something to hide. Postal votes certainly do not take place in Lloyds underwriters.
      My hon. Friend the Member for Newcastle-under-Lyme (Mrs. Golding) several time used the words "as in the general election" when referring to postal votes. When she described her activities as NUPE's branch secretary, she described how postal votes are distributed.
      Last Monday and again today, my hon. Friend the Member for Bolsover (Mr. Skinner) made a point about how we take votes in this House. He described it as the Longbridge method. However, we must consider the votes that elect Members to this place. The general election is more like a workplace ballot than a postal ballot. What would happen if we conducted parliamentary elections by postal ballot?
      386
      I ask hon. Members on both sides of the House to speculate on the outcry that would occur if there was one story of a house-owner—man, woman, mother or father—who said to a child who might be 18, 19, or 20 years old and still living at home, "I'm not having any Tory voters in this house. You had better show me that ballot paper before you submit it; otherwise you are out of the house." What a hoo-hah there would be if that sort of thing happened in a general election. However, that cannot happen because the general election is not conducted by postal ballot.
      5.30 pm
      We are not simply concerned about trade union officers delivering ballot papers. As the clause is drafted at present, there will be remedies—although they are not very reliable — and procedures that may ensure that ballot papers are sent out properly. However, not even this Government could conceive of a law that would regulate the way in which the ballot papers were returned. Someone must collect those papers. Even if the papers are supposed to be posted back through the Post Office, nothing will stop the practice that happens during a general election with postal votes. That procedure involves someone visiting a house and telling the occupant, "If you have not put in your paper yet, I'll put it in for you."
      We are not just concerned about influencing how people vote. We do not know whether postal votes will even be submitted. At least in a general election one can check the register to discover whether a person with a polling number has submitted a postal vote. That cannot happen in trade union elections unless the Government have even more hidden agendas in mind in terms of registers of trade union members available for public inspection. We would not need blacklists any more; employers would have a national register of union members. The only way in which we can prevent the abuse of postal ballots is by creating even greater abuses.
      As late as the 1960s, I can remember canvassing in a by-election not in a wild rural area, but in mid-Bedfordshire. I remember farm workers in tied cottages telling me that they believed that the farmer who owned the cottages knew how they voted. I remember how difficult it was to persuade people that the ballot was secret. My goodness, if there had been a postal ballot, those farm workers in tied cottages would have said that the owner came round and made them show him their ballot papers.
      Conservative Members must explain why it has never been seriously suggested that hon. Members should be elected to this place on a postal ballot except where voters are infirm or blind or suffer some other disability. I stress that a postal ballot is not secret. If a method of voting by going out and recording a vote in a ballot box in a designated place which can be properly scrutinised is good enough for electing Members to this place, why is it not good enough for trade unionists? We are not even asking for that: We are simply asking that trade unionists should have that option if they believe that that is best.
      Mr. Frank Haynes: I will be very brief and ask a question. Is the Minister aware that not many days ago there was an election for the president of the National Union of Mineworkers? In Nottingham, British Coal—the employer — recognises only the other union, the Union of Democratic Mineworkers.
      In years gone by, my experience has been that, when a ballot took place, facilities were provided at the workplace

      387
      —the pit. In the presidential election, members of the NUM were denied that facility. They were told to take their ballot box on to the street and to ballot there. That is what happened.
      I want to refer to the point raised by the hon. Member for Bedfordshire, South-West (Mr. Madel) about postal ballots and ballot papers going to the employer. Bearing in mind what I have just said about the management not co-operating with NUM members in the recent ballot for the NUM president, if the Minister's answer to the hon. Member for Bedfordshire, South-West is yes, can he assure us that there will be fair play for those NUM members in Nottinghamshire in future?
      Mr. Andrew Welsh: I want to ask a specific question. To save the Minister intervening at this point, he can answer me in his reply. I know that, rightly, the Government are keen to reduce bureaucracy affecting businesses and especially small businesses, and they have my support in that. However, this measure will do the opposite for trade unions which, to some extent, must rely on the voluntary and unpaid efforts of individual members.
      Has the Minister any estimate of the extra bureaucratic costs and the effect on unions of imposing the extra burden? Is the Minister pressing the clause on ideological grounds, irrespective of the effect of the costs on trade unions? If not, will he tell the House what homework he has done on the effects of the clause? Is he thinking of extending the principle to other organisations, or will it apply only to trade unions because they are trade unions? I am not sponsored by a trade union, but I can tell when an organisation is being persecuted.
      The Parliamentary Under-Secretary of State for Employment (Mr. Patrick Nicholls): The hon. Member for Oldham, West (Mr. Meacher) stated fairly that we had debated this point at length in Committee. We have also debated it at some length this afternoon. He said that postal balloting cannot be said to be inherently more democratic than workplace balloting, and of course he is right. How hon. Members vote on this clause will depend on whether they believe that the turnout is the most important consideration.
      It was obvious from the debates in Committee and from what we have heard from many hon. Members today that many of them believe that turnout is the most important point. I can understand the sincerity with which hon. Members make that point, but the Government do not accept that turnout must be the final criterion. If we had to pick the most important point, we believe that it would be the ability of a person to vote knowing that he is voting secretly and in a system that offers the best chance—not a guarantee, because there is no such thing—of being able to vote in a secure, safe, free and secret manner. That must be the best criterion.
      The hon. Member for Oldham, West referred to the evidence and to the example given in paragraph 5.13 of the Green Paper. Many references have been made to that in our deliberations. Paragraph 5.13 refers to the election of the general secretary of the Transport and General Workers Union. All credit should go to the TGWU for having that matter investigated. I remember that well. The press campaign that preceded the union's decision to act in that way was considerable. Whatever else we might try
      388
      to accuse the hon. Member for Oldham, West of, I fully believe that he is as appalled about rigging in union elections as any Conservative Member. I hope that he will accept that from me. There is no monopoly on outrage about those matters.
      Opposition Members have said that there were irregularities in only eight branches out of 9,500. Only 12 branches were investigated. When it becomes evident that some 799 votes out of 800 were signed by the same hand and the remaining paper was spoilt, there can be no doubt about the abuse. Indeed, The Observer—which is not an uncritical organ of the Conservative party — was prompted to say about that election that it had interviewed a trade union official who complained of having writer's cramp. I am as appalled about what happened as the hon. Member for Oldham, West.
      However, we must tackle the fact that such a vice can occur within the system. I accept fully that the hon. Member for Oldham, West and his hon. Friends feel as badly about that abuse as Conservative Members. Therefore, the House must ask whether it is possible to devise a method that will ensure that those abuses do not happen.
      Mr. Heffer: I refer the Minister again to the system used by my old union, the Amalgamated Society of Woodworkers. It is far better than anything else that has been suggested. Is he aware that in trade unions, whatever their political or religious views, members vote for people because they think they are the best people? In my branch, one member belonged to the Roman Catholic Church. He always nominated a member of the Communist party. I once asked him, "Why do you do that?" He said, "Because he is the best trade unionist. His politics have nothing to do with it." That is democracy in a trade union.
      Mr. Nicholls: I would have come in due course to the contribution of the hon. Member for Liverpool, Walton (Mr. Heffer), but I will deal with it now. I accept what he has said about his experience in the trade union movement. I can understand that someone with his determination, commitment, industry and eloquence would never put up with some of the abuses which might happen. What we have to decide goes further.
      Where trade union members do not have the benefit of the commitment of people such as the hon. Member for Walton to see that the procedure runs properly, can we provide a system that is free-standing?
      The point has been made that many unions already have postal ballots. All we are saying is that essentially it is a question of trying to extend to all unions the benefits that some enjoy. It cannot be sufficient to leave it to the trade union when the present system can give rise to abuses which the hon. Member for Walton would deplore as much as I do.
      5.45 pm
      Another point ran through the contributions of several hon. Members, including the hon. Member for Walsall, North (Mr. Winnick) and the hon. Member for Nottingham, North (Mr. Allen), the idea being that in some way we had abandoned the legislation which we passed as recently as 1984 and that we were embarking on a different course. If we consider the Trade Union Act 1984 as it finally emerged after debate in the House, it is clear that we had a commitment to the principle of postal balloting but it was said that in certain circumstances it need not take place.

      389
      The reason for my right hon. Friend taking that view was that he had heard, as we all had from trade unions, that it would be unfair to require postal ballots because unions had not had a chance to compile proper membership lists. We have moved on four years. We say that unions have had ample time to compile the lists and that it should now be possible to have a system of postal balloting.
      In the end it must come down to this: can we leave this to the trade union movement and can we be certain that in every single case abuses will not take place? Obviously we cannot. Therefore, we have to devise a system which minimises the possibility of abuse. Although it is not a fail-safe or a guarantee, in the end a postal ballot comes nearer to that ideal.
      Question put, That the amendment be made:
      The House divided: Ayes 202, Noes 288.

      Division No. 175]

      [5.45 pm

      AYES

      Abbott, Ms Diane

      Ewing, Harry (Falkirk E)

      Adams, Allen (Paisley N)

      Fatchett, Derek

      Allen, Graham

      Faulds, Andrew

      Archer, Rt Hon Peter

      Field, Frank (Birkenhead)

      Armstrong, Ms Hilary

      Fisher, Mark

      Ashley, Rt Hon Jack

      Flannery, Martin

      Ashton, Joe

      Flynn, Paul

      Banks, Tony (Newham NW)

      Foot, Rt Hon Michael

      Barnes, Harry (Derbyshire NE)

      Foster, Derek

      Barron, Kevin

      Foulkes, George

      Battle, John

      Fraser, John

      Bell, Stuart

      Fyfe, Mrs Maria

      Benn, Rt Hon Tony

      Galbraith, Samuel

      Bennett, A. F. (D'nt'n & R'dish)

      Garrett, John (Norwich South)

      Bermingham, Gerald

      Garrett, Ted (Wallsend)

      Blair, Tony

      Godman, Dr Norman A.

      Blunkett, David

      Gordon, Ms Mildred

      Boateng, Paul

      Gould, Bryan

      Boyes, Roland

      Graham, Thomas

      Bray, Dr Jeremy

      Grant, Bernie (Tottenham)

      Brown, Gordon (D'mline E)

      Griffiths, Nigel (Edinburgh S)

      Brown, Nicholas (Newcastle E)

      Griffiths, Win (Bridgend)

      Brown, Ron (Edinburgh Leith)

      Grocott, Bruce

      Buchan, Norman

      Hardy, Peter

      Buckley, George

      Hattersley, Rt Hon Roy

      Campbell, Ron (Blyth Valley)

      Haynes, Frank

      Campbell-Savours, D. N.

      Healey, Rt Hon Denis

      Canavan, Dennis

      Heffer, Eric S.

      Clark, Dr David (S Shields)

      Henderson, Douglas

      Clarke, Tom (Monklands W)

      Hinchliffe, David

      Clay, Bob

      Hogg, N. (C'nauld & Kilsyth)

      Clelland, David

      Holland, Stuart

      Clwyd, Mrs Ann

      Home Robertson, John

      Cohen, Harry

      Hood, James

      Coleman, Donald

      Hoyle, Doug

      Cook, Robin (Livingston)

      Hughes, John (Coventry NE)

      Corbett, Robin

      Hughes, Robert (Aberdeen N)

      Corbyn, Jeremy

      Hughes, Roy (Newport E)

      Cousins, Jim

      Hughes, Sean (Knowsley S)

      Crowther, Stan

      Illsley, Eric

      Cryer, Bob

      Ingram, Adam

      Cummings, J.

      Janner, Greville

      Cunliffe, Lawrence

      John, Brynmor

      Cunningham, Dr John

      Jones, Barry (Alyn & Deeside)

      Dalyell, Tam

      Jones, Ieuan (Ynys Môn)

      Darling, Alastair

      Jones, Martyn (Clwyd S W)

      Davies, Rt Hon Denzil (Llanelli)

      Kaufman, Rt Hon Gerald

      Davies, Ron (Caerphilly)

      Kinnock, Rt Hon Neil

      Davis, Terry (B'ham Hodge H'I)

      Lambie, David

      Dewar, Donald

      Lamond, James

      Dixon, Don

      Leighton, Ron

      Dobson, Frank

      Lewis, Terry

      Doran, Frank

      Litherland, Robert

      Duffy, A. E. P.

      Livingstone, Ken

      Dunnachie, James

      Lloyd, Tony (Stretford)

      Dunwoody, Hon Mrs Gwyneth

      Lofthouse, Geoffrey

      390

      McAllion, John

      Reid, John

      McAvoy, Tom

      Richardson, Ms Jo

      McCartney, Ian

      Roberts, Allan (Bootle)

      Macdonald, Calum

      Robinson, Geoffrey

      McFall, John

      Rogers, Allan

      McGrady, E. K.

      Rooker, Jeff

      McKay, Allen (Penistone)

      Ross, Ernie (Dundee W)

      McKelvey, William

      Rowlands, Ted

      McLeish, Henry

      Ruddock, Ms Joan

      McNamara, Kevin

      Salmond, Alex

      McTaggart, Bob

      Sedgemore, Brian

      Madden, Max

      Sheerman, Barry

      Mahon, Mrs Alice

      Sheldon, Rt Hon Robert

      Mallon, Seamus

      Shore, Rt Hon Peter

      Marek, Dr John

      Short, Clare

      Marshall, Jim (Leicester S)

      Skinner, Dennis

      Martin, Michael (Springburn)

      Smith, Andrew (Oxford E)

      Martlew, Eric

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

      Maxton, John

      Smith, Rt Hon J. (Monk'ds E)

      Meacher, Michael

      Soley, Clive

      Meale, Alan

      Steinberg, Gerald

      Michael, Alun

      Stott, Roger

      Michie, Bill (Sheffield Heeley)

      Strang, Gavin

      Millan, Rt Hon Bruce

      Taylor, Mrs Ann (Dewsbury)

      Mitchell, Austin (G'f Grimsby)

      Thomas, Dafydd Elis

      Moonie, Dr Lewis

      Thompson, Jack (Wansbeck)

      Morgan, Rhodri

      Turner, Dennis

      Morris, Rt Hon A (W'shawe)

      Vaz, Keith

      Morris, Rt Hon J (Aberavon)

      Wall, Pat

      Mowlam, Marjorie

      Walley, Ms Joan

      Mullin, Chris

      Wardell, Gareth (Gower)

      Murphy, Paul

      Wareing, Robert N.

      Nellist, Dave

      Welsh, Andrew (Angus E)

      Oakes, Rt Hon Gordon

      Welsh, Michael (Doncaster N)

      O'Brien, William

      Wigley, Dafydd

      O'Neill, Martin

      Williams, Rt Hon A. J.

      Orme, Rt Hon Stanley

      Williams, Alan W. (Carm'then)

      Parry, Robert

      Wilson, Brian

      Patchett, Terry

      Winnick, David

      Pendry, Tom

      Wise, Mrs Audrey

      Pike, Peter

      Worthington, Anthony

      Powell, Ray (Ogmore)

      Wray, James

      Prescott, John

      Young, David (Bolton SE)

      Primarolo, Ms Dawn

      Quin, Ms Joyce

      Tellers for the Ayes:

      Radice, Giles

      Mrs. Llin Golding and

      Rees, Rt Hon Merlyn

      Mr. Frank Cook.

      NOES

      Adley, Robert

      Bowden, A (Brighton K'pto'n)

      Aitken, Jonathan

      Bowden, Gerald (Dulwich)

      Alison, Rt Hon Michael

      Bowis, John

      Allason, Rupert

      Boyson, Rt Hon Dr Sir Rhodes

      Amess, David

      Braine, Rt Hon Sir Bernard

      Amos, Alan

      Brandon-Bravo, Martin

      Arbuthnot, James

      Brazier, Julian

      Arnold, Jacques (Gravesham)

      Bright, Graham

      Ashdown, Paddy

      Brittan, Rt Hon Leon

      Aspinwall, Jack

      Bruce, Ian (Dorset South)

      Atkins, Robert

      Bruce, Malcolm (Gordon)

      Atkinson, David

      Buck, Sir Antony

      Baker, Nicholas (Dorset N)

      Budgen, Nicholas

      Baldry, Tony

      Burns, Simon

      Barnes, Mrs Rosie (Greenwich)

      Butcher, John

      Batiste, Spencer

      Butler, Chris

      Beaumont-Dark, Anthony

      Butterfill, John

      Beith, A. J.

      Campbell, Menzies (Fife NE)

      Bellingham, Henry

      Carlile, Alex (Mont'g)

      Bendall, Vivian

      Carlisle, Kenneth (Lincoln)

      Bennett, Nicholas (Pembroke)

      Carrington, Matthew

      Benyon, W.

      Carttiss, Michael

      Bevan, David Gilroy

      Cash, William

      Biffen, Rt Hon John

      Chapman, Sydney

      Biggs-Davison, Sir John

      Chope, Christopher

      Blackburn, Dr John G.

      Clark, Hon Alan (Plym'th S'n)

      Blaker, Rt Hon Sir Peter

      Clark, Dr Michael (Rochford)

      Bonsor, Sir Nicholas

      Clark, Sir W. (Croydon S)

      Boscawen, Hon Robert

      Colvin, Michael

      Boswell, Tim

      Conway, Derek

      Bottomley, Mrs Virginia

      Coombs, Anthony (Wyre F'rest)

      391

      Coombs, Simon (Swindon)

      Jack, Michael

      Cope,John

      Janman, Timothy

      Cormack, Patrick

      Jessel, Toby

      Couchman, James

      Johnston, Sir Russell

      Cran, James

      Jones, Gwilym (Cardiff N)

      Currie, Mrs Edwina

      Jones, Robert B (Herts W)

      Curry, David

      Kellett-Bowman, Dame Elaine

      Davies, Q. (Stamf'd & Spald'g)

      Key, Robert

      Davis, David (Boothferry)

      King, Roger (B'ham N'thfield)

      Day, Stephen

      Kirkhope, Timothy

      Devlin, Tim

      Kirkwood, Archy

      Dickens, Geoffrey

      Knapman, Roger

      Douglas-Hamilton, Lord James

      Knight, Greg (Derby North)

      Dover, Den

      Knight, Dame Jill (Edgbaston)

      Dunn, Bob

      Knowles, Michael

      Durant, Tony

      Knox, David

      Evennett, David

      Lang, Ian

      Fairbairn, Nicholas

      Latham, Michael

      Fallon, Michael

      Lawrence, Ivan

      Favell, Tony

      Leigh, Edward (Gainsbor'gh)

      Fearn, Ronald

      Lennox-Boyd, Hon Mark

      Fenner, Dame Peggy

      Lester, Jim (Broxtowe)

      Field, Barry (Isle of Wight)

      Lilley, Peter

      Forman, Nigel

      Livsey, Richard

      Forsyth, Michael (Stirling)

      Lloyd, Peter (Fareham)

      Forth, Eric

      Lord, Michael

      Fowler, Rt Hon Norman

      McCrindle, Robert

      Fox, Sir Marcus

      Macfarlane, Sir Neil

      Franks, Cecil

      Maclean, David

      French, Douglas

      Maclennan, Robert

      Fry, Peter

      McLoughlin, Patrick

      Gale, Roger

      Madel, David

      Gardiner, George

      Malins, Humfrey

      Garel-Jones, Tristan

      Mans, Keith

      Gill, Christopher

      Martin, David (Portsmouth S)

      Glyn, Dr Alan

      Mawhinney, Dr Brian

      Goodson-Wickes, Dr Charles

      Mellor, David

      Gorman, Mrs Teresa

      Michie, Mrs Ray (Arg'l & Bute)

      Gorst, John

      Mills, Iain

      Gow, Ian

      Mitchell, Andrew (Gedling)

      Gower, Sir Raymond

      Monro, Sir Hector

      Grant, Sir Anthony (CambsSW)

      Montgomery, Sir Fergus

      Greenway, Harry (Ealing N)

      Moore, Rt Hon John

      Greenway, John (Rydale)

      Morris, M (N'hampton S)

      Gregory, Conal

      Morrison, Hon Sir Charles

      Griffiths, Peter (Portsmouth N)

      Mudd, David

      Grist, Ian

      Neale, Gerrard

      Ground, Patrick

      Nelson, Anthony

      Grylls, Michael

      Neubert, Michael

      Gummer, Rt Hon John Selwyn

      Newton, Rt Hon Tony

      Hamilton, Hon A. (Epsom)

      Nicholls, Patrick

      Hampson, Dr Keith

      Nicholson, David (Taunton)

      Hanley, Jeremy

      Nicholson, Miss E. (Devon W)

      Hannam,John

      Onslow, Rt Hon Cranley

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

      Page, Richard

      Hargreaves, Ken (Hyndburn)

      Paice, James

      Harris, David

      Patnick, Irvine

      Hawkins, Christopher

      Patten, John (Oxford W)

      Hayes, Jerry

      Pawsey, James

      Hayhoe, Rt Hon Sir Barney

      Peacock, Mrs Elizabeth

      Hayward, Robert

      Porter, Barry (Wirral S)

      Heathcoat-Amory, David

      Porter, David (Waveney)

      Heddle, John

      Portillo, Michael

      Hicks, Mrs Maureen (Wolv' NE)

      Powell, William (Corby)

      Hicks, Robert (Cornwall SE)

      Price, Sir David

      Hill, James

      Raffan, Keith

      Hind, Kenneth

      Raison, Rt Hon Timothy

      Hogg, Hon Douglas (Gr'th'm)

      Rathbone, Tim

      Holt, Richard

      Redwood, John

      Hordern, Sir Peter

      Renton, Tim

      Howard, Michael

      Rhodes James, Robert

      Howell, Rt Hon David (G'dford)

      Rhys Williams, Sir Brandon

      Howell, Ralph (North Norfolk)

      Riddick, Graham

      Howells, Geraint

      Ridsdale, Sir Julian

      Hughes, Robert G. (Harrow W)

      Rifkind, Rt Hon Malcolm

      Hughes, Simon (Southwark)

      Roberts, Wyn (Conwy)

      Hunt, David (Wirral W)

      Roe, Mrs Marion

      Hunt, John (Ravensbourne)

      Rossi, Sir Hugh

      Irvine, Michael

      Rost, Peter

      Irving, Charles

      Rowe, Andrew

      392

      Rumbold, Mrs Angela

      Thompson, D. (Calder Valley)

      Ryder, Richard

      Thompson, Patrick (Norwich N)

      Sainsbury, Hon Tim

      Thornton, Malcolm

      Sayeed, Jonathan

      Thurnham, Peter

      Shaw, David (Dover)

      Tredinnick, David

      Shaw, Sir Giles (Pudsey)

      Trotter, Neville

      Shaw, Sir Michael (Scarb')

      Twinn, Dr Ian

      Shelton, William (Streatham)

      Vaughan, Sir Gerard

      Shephard, Mrs G. (Norfolk SW)

      Waddington, Rt Hon David

      Shepherd, Colin (Hereford)

      Wakeham, Rt Hon John

      Shepherd, Richard (Aldridge)

      Waldegrave, Hon William

      Shersby, Michael

      Walden, George

      Sims, Roger

      Walker, Bill (T'side North)

      Skeet, Sir Trevor

      Walker, Rt Hon P. (W'cester)

      Smith, Sir Dudley (Warwick)

      Wallace, James

      Smith, Tim (Beaconsfield)

      Waller, Gary

      Soames, Hon Nicholas

      Walters, Dennis

      Speed, Keith

      Wardle, C. (Bexhill)

      Speller, Tony

      Watts, John

      Squire, Robin

      Wells, Bowen

      Stanbrook, Ivor

      Wheeler, John

      Steel, Rt Hon David

      Whitney, Ray

      Steen, Anthony

      Widdecombe, Miss Ann

      Stern, Michael

      Wiggin, Jerry

      Stevens, Lewis

      Wilshire, David

      Stewart, Allan (Eastwood)

      Winterton, Nicholas

      Stewart, Andrew (Sherwood)

      Wolfson, Mark

      Stewart, Ian (Hertfordshire N)

      Wood, Timothy

      Stradling Thomas, Sir John

      Woodcock, Mike

      Sumberg, David

      Young, Sir George (Acton)

      Taylor, Ian (Esher)

      Younger, Rt Hon George

      Taylor, John M (Solihull)

      Taylor, Matthew (Truro)

      Tellers for the Noes:

      Tebbit, Rt Hon Norman

      Mr. David Lightbown and

      Temple-Morris, Peter

      Mr. Stephen Dorrell.

      Question accordingly negatived.

    Clause 14

      INDEPENDENT SCRUTINY OF CERTAIN BALLOTS AND ELECTIONS
      The Minister for Employment (Mr. John Cope): I beg to move Government amendment No. 11, in page 19, line 1, leave out from `(a)' to 'either' in line 3 and insert
      'within the period of three months after it receives the report—

      (i) send a copy of the report to every member of the union to whom it is reasonably practicable to send such a copy; or

      (ii) take all such other steps for notifying the contents of the report to the members of the union (whether by publishing the report or otherwise) as it is the practice of the union to take when matters of general interest to all its members need to be brought to their attention;

      (b) ensure that any copy sent or notification given for he purposes of paragraph (a) above is accompanied by a statement that the union will, on request, supply any member of the union with a copy of the report,'.
      The amendment implements the results of the review that we promised in Committee of the method of making the scrutineer's report available to union members. The Bill as drafted was silent on how the report should be sent to members, as long as it is sent by some method to all members. As amended, the clause gives unions a choice as to how they distribute the report, and I hope that it meets the point raised by the Opposition in Committee.
      Mr. Gavin Strang: This is a minor amendment, but one that we welcome. There may have been some speculation on Second Reading, and certainly in Committee, about the general thinking behind the

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      Government's approach to some aspects of the Bill. I have to say that we thought it ridiculous that a separate copy of the scrutineer's report should have to be sent to every member of the union.
      The question that has to be asked is not why the Government are amending it, but why it was in the Bill in the first place. I suppose one could say that it was an error on the part of the civil servants. However, with your great experience, Mr. Deputy Speaker, of trade union affairs and the Department of Employment, that is unlikely. I suggest another proposition, which is that civil servants have been operating on the basis that it is the Government's intention to harass the unions and make it as difficult as possible for them to go about their democratic affairs.
      We welcome this minor change. I think that the Minister will confirm that it means that the results of the scrutineer's report can be published in the union journal, along with the statement making it clear that any individual member of the union can write and ask for the full report. That is a more practical way of dealing with the matter than having to send a copy of the scrutineer's report to each union member.
      Mr. Cope: I can confirm that the journal would be an appropriate method of doing that, if it is the way in which the union usually distributes information to its members. I would never blame our civil servants for any matter with which the hon. Member for Edinburgh, East (Mr. Strang) or anybody else may disagree. We are responsible for it. However, I would not accept the alternative explanation offered by the hon. Member.
      Amendment agreed to.

    Clause 16

      BALLOTS ON INDUSTRIAL ACTION AFFECTING DIFFERENT PLACES OF WORK
      Mr. Strang: I beg to move amendment No. 12, in page 20, line 6, leave out clause 16.
      Mr. Deputy Speaker: With this, it will be convenient to take the following: Government amendment No. 22.
      Amendment No. 13, in clause 17, page 21, line 33, at end insert
      'including such provisions as may be necessary to ensure that a union conducting a ballot under section 11 of the 1984 Act does not create an artificial balloting constituency for the purposes of securing a particular result in that ballot.'.
      6 pm
      Mr. Strang: When he replied to the debate in Committee, the Under-Secretary of State agreed with me that this was one of the most important clauses in the Bill. Is it not reprehensible that the Green Paper did not refer to it? No notice was given to the trade union movement that this further imposition was to be included in this anti-trade union Bill. Was it not also remarkable that, on Second Reading, the Secretary of State did not refer to this important clause? That shows the contempt which the Government have shown for the trade union movement and their indifference to the position of many employers who are concerned about and opposed to the clause.
      The Under-Secretary of State, who is a legal expert, agreed in Committee that this is a complex clause. Perhaps I can illustrate that by quoting an explanation which I obtained in a letter from the Minister of State when I wrote
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      to him about this clause in November last year. The clause is about ballots and about the balloting constituency with which trade unions will have to comply if they are to have a ballot which will give them immunity in tort for industrial action.
      In his letter, the Minister said:
      "Ballots where the union properly gives entitlement to vote to all of its members (ie. the "balloting constituency" consists of all its members) will not be affected at all by the provisions of clause 16. Nor will any ballot be affected where the union properly gives entitlement to vote

      (a) to all of its members employed by one employer, or by each of a number of employers taken together; or

      (b) all of its members employed in one particular occupational description or grade or each of a number of descriptions or grades taken together; or

      (c) to all of its members employed by one particular employer (or each of a number of employers taken together) in a particular occupational description or grade (or each of a number of descriptions or grades taken together).

      There will also be other cases involving more complex permutations of membership and employment by particular employers in which the balloting constituency will not mean that separate ballots have to be held in order to preserve immunity."
      That is how the Minister of State responded in part to my letter. This is a valid point. Surely we should be putting on the statute book industrial relations legislation which people clearly understand. For example, in a dispute such as that involving the National Union of Seamen, if the union takes legal advice, it should receive an answer in which the solicitor or the QC has some confidence. That will increase the prospects, when an employer takes legal advice from another individual, of the two sets of advice coinciding. That is a desirable prospect for industrial relations.
      The clause is unacceptable, because legal experts disagree about what it means. It is not good enough for Ministers always to duck out of this, as they did in Committee, by saying that it is a matter for the courts. We want to be clear about what it means before the Bill goes on to the statute book, so that workers, trade unions, managers and employers recognise the requirements which must be met in respect of the balloting process. The clause is about ballots and about democracy. That is why it is an important clause. It concerns the ballots which will be taken to determine whether, for example, workers at the Ford Motor Company can come out on strike in circumstances which prevent their union's funds from being sequestered. That is an important element of the Bill.
      Mr. Allen: One reason why the Government may not understand the full implications of their legislation is that it was introduced at a late stage and was not even in the Green Paper. It is not good industrial relations law, and it gives rise to some political venom from the Secretary of State for Employment who brought with him all his prejudices from his previous post as Secretary of State for Social Services—where, as I understand it, he had a had time as a result of selective strikes. Perhaps that is why this clause, more than any other in the Bill, is a complete botch.
      Mr. Strang: It is interesting to note that a number of correspondents at the time believed that it related to that, although Ministers denied in Committee that that was the intention of the clause.
      The democracy issue is fundamental to this Bill, to these amendments and to the Government's approach to industrial relations. The 1984 Act, which requires a trade

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      union to ballot its members and to obtain a majority before it can take authorised industrial action without being subject to legal challenge, is a fundamental ingredient of industrial relations legislation. The Government argue that they had to intervene to impose these legislative requirements because a substantial number of strikes were not in response to the genuine aspirations of workers or trade unionists. They claim that those strikes were a consequence of hot-headed, militant trade union leaders dragging people out on strike and contributing to poor industrial relations and the loss of many working days.
      Conservative Members will not be making too much of that point in the context of the current industrial strife. There has already been a reference to the day of action in north-west England about the state of the Health Service. Is it being suggested that, on that day of action, trade unions such as NUPE and COHSE are pulling out those nurses and workers against their will? Most hon. Members will understand what the role of most of those officials has been today. They have created the programme. They have created the situation in which the workers can take that action in a way that minimises the risk of serious hardship to their patients. That is the constructive role which most trade union officials will have been taking, in practice, today in respect of industrial action in the Health Service.
      I referred to that point on Monday. In the seamen's dispute, the leadership is urging workers involved in selective action to resume working. It is not a question of the officials trying to bring the workers out on strike. It is a question of the determination or otherwise of the seamen themselves.
      The same point applies to the Ford strike. The Secretary of State was brought here to answer a private notice question on Monday. His first point was that, although this was potentially an enormously important strike for the British economy, it had nothing to do with the Government. Indeed, he appeared to resent the fact that he had to appear before this House, but he admitted that the trade union officials had recommended the amended offer which was negotiated last Sunday. No one can suggest that the trade unionists at Ford are being pulled out on strike against their will.
      If the Ford dispute is settled in an orderly way—it is in the interests of the trade unions and of the Ford Motor Company to do so—it will be settled on the basis of a negotiated settlement between the unions and the Ford Motor Company. Anything which the Government, or anyone else, might seek to do to create anarchy and to encourage workers to go back to work, when there is an official dispute, is more likely to prolong the dispute than help to secure a solution.
      The clause is important. By imposing a further requirement on top of the Trade Union Act 1984, it will make the position worse rather than better. Why have the Government brought it forward in the first place? When challenged in Committee, the Minister said that they were worried that section 11 of the 1984 Act was defective because unions might create artificial balloting constituencies to get a majority in a strike ballot. In other words, they might put two groups of workers together, one militant and one not, to get an overall majority for a strike and thus get the moderate group of workers into a dispute with their employer.
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      Some of us wondered how the Government discovered the problem of artificial balloting constituencies. We asked for examples. In Committee, we eventually dragged out half an example. We demonstrated that it did not make the case for the clause. We are aware that, in its submission, the Institute of Personnel Management suggested that it was a possibility. I wonder. Is it because of what the IPM has said could happen that civil servants decided to put such a monstrous and damaging industrial relations proposal to the Ministers?
      The Government did not know whether the problem was real and needed to be addressed in legislation or whether it existed purely in the minds of certain individuals who were scrutinising industrial relations legislation. It is as though a college of cardinals had met to discuss the number of angels who could congregate on a pinhead and decided to frame the result in legislation. The result is a clause that can only damage industrial relations.
      As it stands, clause 16 amends sections 10 and 11 of the Trade Union Act 1984. Section 10 obliges a union, if it is to be immune from action in tort, to hold a ballot and achieve a majority vote before an industrial dispute can take place. Section 11 defines the constituency of trade union members who must be able to vote in such a ballot. In particular, section 11 (1)(a) requires that entitlement to vote be given to all members of the relevant union, who
      "it is reasonable at the time of the ballot for the union to believe will be called upon in the … industrial action to … breach … or interfere with the performance of their contract of employment".
      The Bill goes on to state that the ballot should not be extended to any other workers. That is simple and clear. The Government are seeking to enact a change in the legislation, which of course moves away from that. Clause 16 will become section 11(1)(1A) and (1B) of the 1984 Act. Section 11(1A) subdivides balloting constituencies that fall within section 11 as a whole, thereby placing further restrictions on unions.
      In general, ballots will not lead to immunity in tort unless they satisfy the further and, frankly, ridiculous requirement that each workplace affected by industrial action has been balloted and a majority obtained in each one. That is absurd, to put it mildly. The Government, as under clause 3, seem happy to impose on unions requirements that make an absolute mockery of democracy.
      In practice, exemptions from the requirement will be crucial. In Committee, we pressed the Ministers to find out just how far the terms "occupational description" and "grade" would go and just what sort of constituency would be covered. When will an aggregate ballot be allowed? Obviously, the force of our argument persuaded the Ministers that the exceptions were not wide enough. That is why they came back with the amendment, full of vague talk about factors and reasonable beliefs.
      Faced with the original form of clause 16, Opposition Members were baffled—more important, so were the unions and employers. The Engineering Employers Federation made that clear to me in a letter that I quoted in Committee.
      6.15 pm
      It is not good enough for the Government to bring forward legislation of this nature and tell us that it is up to the courts. We have looked at the Government's amendment. We do not believe that it will contribute in any way to solving the problem. All that will now be

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      required is for a union to believe that all balloted members have some factor, not necessarily common to all, that marks them off from other workers employed by the same employer, and which is not a consequence of their place of work. That would allow artificial balloting constituencies to occur in certain circumstances.
      I shall give an example in the fantasy terms that Conservative Members might understand. In a factory with two moderate Labour-voting supervisors and 10 readers of Socialist Worker who share a certain machine in a production process but who have the same grade and occupational description as 1,000 Tory party supporters elsewhere in the plant, a Machiavellian union could ballot the 10 militants and two supervisors on a wholly spurious grievance and bring the plant to a halt. Under the Bill as it previously stood, that would not have been allowed. Under the Government's amendment, it could happen.
      Opposition Members have moved their own amendment. If the Government are determined to do something along these lines, the sensible approach would be to delete the clause and to lay down the objective of avoiding artificial balloting constituencies. We support that remark. We do not see this as a problem. Of course we recognise that artificial balloting constituencies are not created. If the objective is to prevent that, surely it would be sensible to approach the matter with a code of practice.
      We reject clause 16 and the amendments, because no problem needs to be addressed. We have not heard any evidence or justification from the Government. We reject it because it is complicated, and we do not believe that is in the interests of the House or the country to put industrial relations legislation on the statute book that, frankly, most people cannot understand. We are opposed to it because it will not only be ineffective but will worsen industrial relations. Rather than improve the legislative framework within which managers, employers and workers go about their daily affairs, it will make it worse.
      Mr. Cope: I am not quite sure whether I exaggerate when I say that it seemed to me that both sides of the Committee moved at least a little nearer to one another in the course of the extensive debates on the clause. The result of the debates, as the hon. Member for Edinburgh, East (Mr. Strang) said, is that we redrafted part of the clause in the direction—the hon. Gentleman did not seem to accept it—that Opposition Members and others outside wish. From some of the hon. Gentleman's comments and from amendment No. 13, it seems that Opposition Members have moved far enough at least to recognise the possibility of a problem occurring. The hon. Gentleman said that Opposition Members support the objective of removing artificial constituencies. That is the main purpose of the clause as a whole.
      In Committee, we promised to consider whether it was possible to amend the clause to enable an aggregate ballot of members employed at different places of work if they were in the same bargaining unit or bargaining group. We pointed out that, although the terms "bargaining unit" and "bargaining group" are well understood in general parlance, they are not easy to write into legislation. That is why we propose the definition in the amendment. It retains the general intended effect of clause 16, but I hope it will go some way to meet the concerns expressed in Committee in favour of a greater element of flexibility.
      The hon. Member for Edinburgh, East mentioned vague talk about factors. I describe that as flexibility,
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      which is necessary in this matter. I was interested to hear him complain that he thought that the clause as amended would still allow some artificial balloting constituencies to be created in certain circumstances. In other words, he was complaining that we were not putting enough protection into the Bill.
      However, the amendment will enable a union to hold a single aggregated ballot covering members employed at different places of work, if all the members of a union who are accorded entitlement to vote and who are employed by the same employer have a factor or factors in common. That is the way of defining the bargaining unit, among other things.
      The factor or factors in common must relate to their terms or conditions of employment, or occupational description, and a factor must not be one common to any other member employed by the same employer who is not accorded entitlement to vote. When, and only when, other members of the union employed by the same employer or employers are not in the balloting constituency and are not being given the opportunity to vote, members of the constituency should not have a factor in common merely because they work in the same place or places. They cannot be left out merely because of where they work.
      The amendment does not affect the ability of unions—provided by the clause as it stands — to aggregate ballot votes across groups or employers, provided that the conditions of the new subsection are met for the groups within the balloting constituency.
      I accept what the hon. Member for Edinburgh, East said in Committee — we accepted it there — about the desirability of understandable legislation, but it is my experience, derived from much legislation—by no means exclusively to do with industrial relations or trade unions —that understandable legislation is difficult to achieve.
      I respond more to what the hon. Gentleman said about the importance of legislation being certain. That is not quite the way he put it, but it lay behind what he said. Certain legislation is not always understandable legislation; it means that we must use legal language, and what sometimes seems convoluted language, accurately to define the concept we are getting at, which can sometimes be described more easily in homely terms when we are not writing legislation. Nevertheless, I should like to feel that the Opposition at least think we have gone some way to meeting the concerns expressed in Committee about the bargaining unit, while continuing to address the problem to which outside observers have drawn attention.
      Mr. Michael Foot: Some of the clauses may be described as designed to inflict injury on the trade union movement and to interfere with its operations. Others may be described as the "adding insult to injury" clauses, which may not be so offensive in their operation, but are designed to irritate, confuse and cause general disruption for trade unions who are carrying out their business.
      I discussed some of the previous clauses with the Minister on Monday, and he complained that I had referred to some of them as having the apparent objective of extending balloting in certain areas. He asked what was wrong with that. We know the answer to that: these matters should be left to the trade unions, and it is insulting that the Minister should propose a Bill to teach the trade unions how to run ballots. They have been doing that for generations, building up their different

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      organisations and traditions for dealing with these matters. That is why the clauses are insulting. The Government are forcing all unions to use the same methods of operation, despite their different traditions.
      Clause 16 is different, and a different intention lay behind it in the first place. I was interested to hear that it was not included in the Green Paper and that the Government did not even take the trouble—or have the knowledge—to want to introduce it then. That makes us doubly suspicious, as it did my hon. Friends in Committee.
      The Government came forward with fresh proposals to try to deal with the matter. It would have been much better if the Government had accepted the advice of my hon. Friends and knocked out clause 16. The Government's intention was clearly not to assist the trade union movement.
      Instead, the Government have produced a clause that they say is extremely convoluted. I am sure that those of us who follow these matters closely will have understood exactly what the Minister was saying. There was no confusion or doubt about that after he sat down. But even he, who had studied the matter carefully and been skilfully briefed by the people in the Department of Employment—no one knows better than I how skilful they are—had to admit at the end of his speech that the clause was still convoluted.
      Two sets of people, who are not specially qualified, will have to deal with this convoluted legislation and decide whether a strike is legitimate. The first set are the ordinary workers trying to work out what they can do in particular circumstances. I am not blaming them—usually they know trade union law a great deal better than junior Ministers or anyone else. They have had practice in dealing with it, and have some idea of what it means. I confess to having no faith in the second set of people: Her Majesty's judges. They will get at the legislation even before workers can operate the new law.
      My hon. Friend the Member for Edinburgh, East (Mr. Strang) referred to the strike that almost took place among the seamen. That action is strictly relevant to this matter, because, presumably, the 1984 Act was clear. It was not as convoluted as this clause. What happened is a revelation of the way in which this shoddy sort of legislation operates. The general secretary of the National Union of Seamen has considerable experience of these matters and has engaged, with some considerable success, in industrial action. Perhaps that is why the Government wanted fresh legislation—to make it more difficult for that union to operate.
      When the general secretary and the executive committee of the National Union of Seamen arrived at their view on the present legislation a few weeks ago, they thought that the action they were going to take would be fully within the 1984 law. So did many of their legal advisers. However, when they went to court, they received a different verdict and had to take a different view of their position. The National Union of Seamen, like other unions, wants to abide by the law. We hate it. It is unfair, monstrous and unjust, and it threatens to confiscate that union's funds on a huge scale, but the union has to abide by it.
      As I came to the House this afternoon I listened to what the judge said in this matter. I do not know whether the general secretary was present. He and his associates have,
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      in the past few days, done their best to observe the present convoluted law. They hate it, but they have done their best to implement it.
      The judge told the seamen's representative today that it seemed that the general secretary still has some clout. Judges should try to use more restrained language. To sink into the vernacular is not the proper thing for respectable members of the judicial bench. Whether the general secretary will have any clout after this legislation comes into force and minorities are given an abslolute right to disobey the majority view on a ballot is another matter. I should be interested to hear the views of Her Majesty's judges on that matter.
      6.30 pm
      The judge thought that the NUS had enough clout to tell its members that it would be disobeying the law in certain circumstances. It would not have such clout if it was deprived of effective disciplinary powers inside the union, as it will be under this legislation.
      What happened to the seamen is relevant to the Bill because it will weaken the power of trade union general secretaries to ensure that their members obey the law and to use their position under the law to advance their interests. Clause 16, in its amended convoluted form, as the Minister has described it, or in any other form, will make it more difficult for the NUS in particular to know whether the constituency in which it is asked to have a ballot covers all the areas, and there will be even more confusion in the case of some other unions. When the Minister replies, I shall be happy to hear what will be the application of clause 16, if it remains in the Bill, in a situation such as that recently experienced by the NUS.
      It is fascinating to be discussing the Government's amendments to the Trade Union Act 1984 and the previous measures that they have introduced at the very moment when we are having illustration after illustration of the unworkability of the previous legislation. In the example that I have just given of the NUS there was gross confusion about the law.
      The Ford strike is the latest in a series of examples, to which my hon. Friend the Member for Edinburgh, East referred, where the law is certainly not operating as the Government intended. Surely the Government never intended to ensure that trade union negotiators should be so deprived of their powers to negotiate that, in the Transport and General Workers Union case in the courts, even when it was thought that there was a possibility of a negotiation, the Government's legislation robbed them of the operation of a ballot.
      We are seeing the frustration of the feelings of people on the picket line throughout Britain. There is a report in The Independent today of what was said on the Ford picket line by one of the leaders of the Transport and General Workers Union. Talking of the Prime Minister, she says:
      "She's getting stuffed by her own legislation."
      The cost to the country is huge.
      Partly as a result of that legislation, we have had to have the dribble of legislation, of which the Bill is another example. The Government find that some of the chinks that they thought had been closed have not been, so they must discover some other way of closing them. Then the Government discover some legal loophole or convoluted openings that have been left, so they have to come along with legislation such as this.

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      Perhaps the explanation for the major clause in the Bill about giving minorities rights which the majorities should have had, which is causing such confusion, is that the rest of the Bill is such trivial nonsense. My hon. Friends were forced into hour upon hour of discussion in Committee.
      There is not the slightest guarantee that this Bill will be better than the previous three or four. All of them have been produced for the wrong motives and all have failed to go through the procedure that we always followed for industrial legislation. We always attempted to discuss matters with the people who knew something about them, whether it was the employers or the unions. We even set up some organisations in which employers and unions were represented, precisely so that we should be able to obtain that information properly. In other parts of the Bill the Government are seeking to undermine that balance. That does not give rise to any confidence about what the Government will do in future.
      The Government did not trouble to consult anybody. They did not know the exact evil with which they were trying to deal. They were pushed into Committee with no attempt to discuss the Bill with anybody. Nobody jogged the Government's elbow and said that they might have put some reference into the Green Paper. Now, at the last moment, the Minister comes along to say that he is sorry, but he too thinks that the clause is convoluted.
      The Government should take away this convoluted clause. I use the most moderate language that I possibly can. It would be best if the Government took away the Bill, but at least they should take away some of the clauses that have not been examined properly. They should have the courtesy to discuss them with the people who know something about them.
      It is a wonderful irony that the Government started out with the idea that one of the main things that they would do was to injure and impale the trade union movement on their legislation. They thought that it was wonderfully popular and that they could carry it further and further. They have now overreached themselves and my prophecy is that more and more, as trade unions recover their strength, power and cohesion—the Ford strike and the seamen's strike are only two instances—they will expose the shoddiness and shame of the Government's legislation.
      It would be a splendid beginning to the learning of wisdom in the face of what is happening at Ford's and in the seamen's strike if, for the first time in the Bill's passage through the House, the Government were to make a concession. I am shocked to hear that in all the discussions in Committee not one concession was made. The Government seem to think that they know it all. They thought that they knew so much about the trade union movement that they would not even concede one matter. That is a shocking way in which to try to deal with industrial relations in Britain.
      The Government will pay, because those relations will become more and more embittered and the people who will be responsible are the successive Ministers at the Department of Employment. I am sad to say that, because there was a time when the Department of Employment used its best endeavours—to use a phrase—to try to obtain industrial peace and decent industrial relations. But that cannot be said of this Bill, the Government or the Minister involved.
      Mr. Allen: First, I welcome the hon. Member for Rochdale (Mr. Smith) who was absent from much of the
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      Committee stage due to illness. It is a pleasure to see him in the Chamber, and I hope that he will soon he fully recovered. It may be some consolation to him that his brief contribution probably was more than the aggregate of about nine Conservative Back Benchers in three months' service on the Committee.
      The Government were allowed every possible opportunity to present practical examples of how clause 16 would affect real industrial relations. Indeed, there was even a break at the weekend in which we thought that Ministers might dare to decide what would he the effects of the Bill in particular circumstances. Opposition Members without exception pressed the Government for specific examples in every possible form, shape, structure and convolution to assist Ministers to come to terms with their own legislation. However, that was not possible at any stage.
      I put one question to the Minister tonight. If he cares to listen to the debate, he should listen to this question. If there is a national ballot that is not successful, will trade unions be in a position to ballot particular workplaces and call out those workplaces on strike, having failed to secure a majority nationally? I hope that the Minister can answer that question this evening.
      The Government do not know what they want from the clause. There are deeper implications in not knowing the purpose of the clause. If it is cloudy and unclear to the Government, clearly it will be difficult for trade unions to know what will happen. The suspense with which they will carry out their day-to-day activities will rest heavily upon them.
      I should like to repeat a brief story that I mentioned in Committee. When the great fast bowler Freddie Trueman was asked about all the variations in his style of bowling, he said, "I just run up and bowl it. If I don't know where the bugger is going to be how can the bugger at the other end know"—
      Mr. Speaker: Order. the hon. Gentleman should not use such unparliamentary language.
      Mr. Allen: That was a quotation from Freddie Trueman's autobiography. The person—if I may clean up Mr. Truman's language—at the other end who does not know where the ball is going, whether it will be swinging out, swinging in, a dipper, a yorker or a bouncer, is the trade unionist. The trade unions will be at the other end of the wicket when the legislation is hurled down on them. They will not know its effect because the Government themselves do not know the effect. That theme runs right through clause 16.
      Even today, the clause does not contain an adequate definition of such items such as workplace, occupation and grade. The Government themselves do not know what their own clause means and they cannot give practical examples of how the clause will affect real trade unionists out in the country. The only honourable course would be for the Government to withdraw the clause and start again.
      Mr. Strang: I am glad that my right hon. Friend the Member for Blaenau, Gwent (Mr. Foot) reminded the House that we voted against clause 16 in Committee. We wanted the clause to be removed. My right hon. Friend, with his great experience of these matters, fully

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      understands the impact of the Bill and previous Tory Acts which attempt to undermine trade unions, and will have an adverse effect on industrial relations in Britain.
      In view of what the Minister said, perhaps inadvertently, I must emphasise that Opposition Members do not see a problem that requires legislation. We do not see a problem that requires the Bill. Clause 16 will make things worse, and the Government's amendment will make them worse still. We are moving from a bad scenario to a worse one.
      If a trade union created an artificial balloting constituency, by lumping together a certain group of workers with another group of workers in a wholly unjustifiable way in order to obtain a particular outcome in the ballot—an outcome in favour of industrial action—our view would be that that was bad trade unionism. A trade union would not get away with that.
      6.45 pm
      That is why there are no examples. Trade unionists are not so stupid. If the leadership of a trade union such as the CPSA—and this clause has a great bearing on the Civil Service—or any other trade union—it could apply to the TGWU in relation to the Ford plants — did not ballot all its members, the members themselves would consider that to be unfair. If there is to be a requirement for a ballot on the statute book as in the 1984 Act, the correct approach is to sustain the wording in the 1984 Act, because it is clear. It puts the requirement on the union to ballot those workers who are its members whom it may call out on strike. That is very clear. That is why it corresponds with the bargaining unit, and that is why it is consistent in that sense. Although we do not support the 1984 Act, it is consistent with collective agreements and the prevailing situation in regard to the public sector and throughout many industries.
      I conclude by making it absolutely clear that the Opposition are totally opposed to the Government. We are entirely opposed to the clause. We tabled our amendment because, as the Opposition, we are trying to minimise the damage that the Bill will impose. We accept that we may not defeat the Bill, so we must try to alter it in a way that reduces its impact and the damage that it will do to industrial relations legislation. That is why we shall vote for our amendment.
      Question put, That the amendment be made:—
      The House divided: Ayes 219, Noes 269.

      Division No. 176]

      [6.47 pm

      AYES

      Abbott, Ms Diane

      Bermingham, Gerald

      Adams, Allen (Paisley N)

      Blair, Tony

      Allen, Graham

      Blunkett, David

      Anderson, Donald

      Boateng, Paul

      Archer, Rt Hon Peter

      Boyes, Roland

      Armstrong, Ms Hilary

      Bray, Dr Jeremy

      Ashdown, Paddy

      Brown, Gordon (D'mline E)

      Ashley, Rt Hon Jack

      Brown, Nicholas (Newcastle E)

      Ashton, Joe

      Brown, Ron (Edinburgh Leith)

      Banks, Tony (Newham NW)

      Bruce, Malcolm (Gordon)

      Barnes, Harry (Derbyshire NE)

      Buchan, Norman

      Barron, Kevin

      Buckley, George

      Battle, John

      Callaghan, Jim

      Beckett, Margaret

      Campbell, Ron (Blyth Valley)

      Beith, A. J.

      Campbell-Savours, D. N.

      Bell, Stuart

      Canavan, Dennis

      Benn, Rt Hon Tony

      Carlile, Alex (Mont'g)

      Bennett, A. F. (D'nt'n & R'dish)

      Clark, Dr David (S Shields)

      404

      Clarke, Tom (Monklands W)

      Leighton, Ron

      Clay, Bob

      Lewis, Terry

      Clelland, David

      Litherland, Robert

      Clwyd, Mrs Ann

      Livingstone, Ken

      Cohen, Harry

      Livsey, Richard

      Coleman, Donald

      Lloyd, Tony (Stretford)

      Cook, Frank (Stockton N)

      Lofthouse, Geoffrey

      Cook, Robin (Livingston)

      McAllion, John

      Corbett, Robin

      McAvoy, Tom

      Corbyn, Jeremy

      McCartney, Ian

      Cousins, Jim

      Macdonald, Calum

      Crowther, Stan

      McFall, John

      Cummings, J.

      McGrady, E. K.

      Cunliffe, Lawrence

      McKay, Allen (Penistone)

      Cunningham, Dr John

      McKelvey, William

      Dalyell, Tam

      McLeish, Henry

      Darling, Alastair

      McNamara, Kevin

      Davies, Rt Hon Denzil (Llanelli)

      McTaggart, Bob

      Davies, Ron (Caerphilly)

      Madden, Max

      Davis, Terry (B'ham Hodge H'I)

      Mahon, Mrs Alice

      Dewar, Donald

      Marek, Dr John

      Dixon, Don

      Marshall, David (Shettleston)

      Dobson, Frank

      Marshall, Jim (Leicester S)

      Doran, Frank

      Martin, Michael (Springburn)

      Duffy, A. E. P.

      Martlew, Eric

      Dunnachie, James

      Maxton, John

      Dunwoody, Hon Mrs Gwyneth

      Meacher, Michael

      Eastham, Ken

      Meale, Alan

      Ewing, Harry (Falkirk E)

      Michael, Alun

      Fearn, Ronald

      Michie, Bill (Sheffield Heeley)

      Field, Frank (Birkenhead)

      Michie, Mrs Ray (Arg'l & Bute)

      Fisher, Mark

      Millan, Rt Hon Bruce

      Flannery, Martin

      Mitchell, Austin (G't Grimsby)

      Flynn, Paul

      Moonie, Dr Lewis

      Foot, Rt Hon Michael

      Morgan, Rhodri

      Foster, Derek

      Morley, Elliott

      Foulkes, George

      Morris, Rt Hon A (W'shawe)

      Fraser, John

      Morris, Rt Hon J (Aberavon)

      Fyfe, Mrs Maria

      Mowlam, Marjorie

      Galbraith, Samuel

      Mullin, Chris

      Garrett, John (Norwich South)

      Murphy, Paul

      Garrett, Ted (Wallsend)

      Nellist, Dave

      Godman, Dr Norman A.

      Oakes, Rt Hon Gordon

      Gordon, Ms Mildred

      O'Brien, William

      Gould, Bryan

      O'Neill, Martin

      Graham, Thomas

      Orme, Rt Hon Stanley

      Grant, Bernie (Tottenham)

      Parry, Robert

      Griffiths, Nigel (Edinburgh S)

      Patchett, Terry

      Griffiths, Win (Bridgend)

      Pendry, Tom

      Grocott, Bruce

      Pike, Peter

      Hardy, Peter

      Powell, Ray (Ogmore)

      Hattersley, Rt Hon Roy

      Prescott, John

      Healey, Rt Hon Denis

      Primarolo, Ms Dawn

      Heffer, Eric S.

      Quin, Ms Joyce

      Henderson, Douglas

      Radice, Giles

      Hinchliffe, David

      Rees, Rt Hon Merlyn

      Hogg, N. (C'nauld & Kilsyth)

      Reid, John

      Holland, Stuart

      Richardson, Ms Jo

      Home Robertson, John

      Roberts, Allan (Bootle)

      Hood, James

      Robinson, Geoffrey

      Howarth, George (Knowsley N)

      Rogers, Allan

      Howells, Geraint

      Rooker, Jeff

      Hoyle, Doug

      Ross, Ernie (Dundee W)

      Hughes, John (Coventry NE)

      Rowlands, Ted

      Hughes, Robert (Aberdeen N)

      Ruddock, Ms Joan

      Hughes, Roy (Newport E)

      Salmond, Alex

      Hughes, Sean (Knowsley S)

      Sedgemore, Brian

      Illsley, Eric

      Sheerman, Barry

      Ingram, Adam

      Sheldon, Rt Hon Robert

      Janner, Greville

      Shore, Rt Hon Peter

      John, Brynmor

      Short, Clare

      Johnston, Sir Russell

      Skinner, Dennis

      Jones, Barry (Alyn & Deeside)

      Smith, Andrew (Oxford E)

      Jones, Ieuan (Ynys Môn)

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

      Jones, Martyn (Clwyd S W)

      Smith, Cyril (Rochdale)

      Kaufman, Rt Hon Gerald

      Smith, Rt Hon J. (Monk'ds E)

      Kinnock, Rt Hon Neil

      Snape, Peter

      Kirkwood, Archy

      Soley, Clive

      Lambie, David

      Steel, Rt Hon David

      Lamond, James

      Steinberg, Gerald

      405

      Stott, Roger

      Wigley, Dafydd

      Strang, Gavin

      Williams, Rt Hon A. J.

      Taylor, Mrs Ann (Dewsbury)

      Williams, Alan W. (Carm'then)

      Taylor, Matthew (Truro)

      Wilson, Brian

      Thompson, Jack (Wansbeck)

      Winnick, David

      Turner, Dennis

      Wise, Mrs Audrey

      Vaz, Keith

      Worthington, Anthony

      Wall, Pat

      Wray, James

      Wallace, James

      Young, David (Bolton SE)

      Walley, Ms Joan

      Warden, Gareth (Gower)

      Tellers for the Ayes:

      Wareing, Robert N.

      Mrs. Llin Golding and

      Welsh, Andrew (Angus E)

      Mr. Frank Haynes.

      Welsh, Michael (Doncaster N)

      NOES

      Adley, Robert

      Davis, David (Boothferry)

      Aitken, Jonathan

      Day, Stephen

      Allason, Rupert

      Devlin, Tim

      Amess, David

      Dickens, Geoffrey

      Amos, Alan

      Dicks, Terry

      Arbuthnot, James

      Dorrell, Stephen

      Arnold, Jacques (Gravesham)

      Douglas-Hamilton, Lord James

      Arnold, Tom (Hazel Grove)

      Dover, Den

      Aspinwall, Jack

      Dunn, Bob

      Atkins, Robert

      Durant, Tony

      Atkinson, David

      Emery, Sir Peter

      Baker, Nicholas (Dorset N)

      Evennett, David

      Baldry, Tony

      Fairbairn, Nicholas

      Batiste, Spencer

      Fallon, Michael

      Beaumont-Dark, Anthony

      Farr, Sir John

      Bellingham, Henry

      Favell, Tony

      Bendall, Vivian

      Fenner, Dame Peggy

      Bennett, Nicholas (Pembroke)

      Field, Barry (Isle of Wight)

      Benyon,W.

      Forman, Nigel

      Bevan, David Gilroy

      Forth, Eric

      Biffen, Rt Hon John

      Fowler, Rt Hon Norman

      Biggs-Davison, Sir John

      Fox, Sir Marcus

      Blackburn, Dr John G.

      Franks, Cecil

      Blaker, Rt Hon Sir Peter

      French, Douglas

      Bonsor, Sir Nicholas

      Fry, Peter

      Boscawen, Hon Robert

      Gale, Roger

      Boswell, Tim

      Gardiner, George

      Bottomley, Mrs Virginia

      Garel-Jones, Tristan

      Bowden, A (Brighton K'pto'n)

      Gill, Christopher

      Bowden, Gerald (Dulwich)

      Glyn, Dr Alan

      Bowis, John

      Goodson-Wickes, Dr Charles

      Boyson, Rt Hon Dr Sir Rhodes

      Gorman, Mrs Teresa

      Braine, Rt Hon Sir Bernard

      Gorst, John

      Brandon-Bravo, Martin

      Gow, Ian

      Brazier, Julian

      Gower, Sir Raymond

      Bright, Graham

      Grant, Sir Anthony (CambsSW)

      Brittan, Rt Hon Leon

      Greenway, Harry (Ealing N)

      Bruce, Ian (Dorset South)

      Greenway, John (Rydale)

      Buck, Sir Antony

      Gregory, Conal

      Budgen, Nicholas

      Griffiths, Sir Eldon (Bury St E')

      Burns, Simon

      Griffiths, Peter (Portsmouth N)

      Butcher, John

      Grist, Ian

      Butler, Chris

      Ground, Patrick

      Butterfill, John

      Grylls, Michael

      Carlisle, Kenneth (Lincoln)

      Hampson, Dr Keith

      Carrington, Matthew

      Hanley, Jeremy

      Carttiss, Michael

      Hannam, John

      Cash, William

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

      Chapman, Sydney

      Hargreaves, Ken (Hyndburn)

      Chope, Christopher

      Harris, David

      Clark, Hon Alan (Plym'th S'n)

      Hawkins, Christopher

      Clark, Dr Michael (Rochford)

      Hayes, Jerry

      Clark, Sir W. (Croydon S)

      Hayhoe, Rt Hon Sir Barney

      Colvin, Michael

      Hayward, Robert

      Conway, Derek

      Heathcoat-Amory, David

      Coombs, Anthony (Wyre F'rest)

      Heddle, John

      Coombs, Simon (Swindon)

      Hicks, Mrs Maureen (Wolv' NE)

      Cope, John

      Hill, James

      Cormack, Patrick

      Hind, Kenneth

      Couchman, James

      Hogg, Hon Douglas (Gr'th'm)

      Cran, James

      Holt, Richard

      Currie, Mrs Edwina

      Hordern, Sir Peter

      Curry, David

      Howard, Michael

      Davies, Q. (Stamf'd & Spald'g)

      Howell, Ralph (North Norfolk)

      406

      Hughes, Robert G. (Harrow W)

      Ridley, Rt Hon Nicholas

      Hunt, David (Wirral W)

      Ridsdale, Sir Julian

      Hunt, John (Ravensbourne)

      Roberts, Wyn (Conwy)

      Hunter, Andrew

      Roe, Mrs Marion

      Irvine, Michael

      Rossi, Sir Hugh

      Irving, Charles

      Rost, Peter

      Jack, Michael

      Rowe, Andrew

      Janman, Timothy

      Rumbold, Mrs Angela

      Jessel, Toby

      Ryder, Richard

      Jones, Gwilym (Cardiff N)

      Sainsbury, Hon Tim

      Jones, Robert B (Herts W)

      Sayeed, Jonathan

      Kellett-Bowman, Dame Elaine

      Shaw, David (Dover)

      Key, Robert

      Shaw, Sir Giles (Pudsey)

      Kilfedder, James

      Shaw, Sir Michael (Scarb')

      King, Roger (B'ham N'thfield)

      Shelton, William (Streatham)

      Kirkhope, Timothy

      Shephard, Mrs G. (Norfolk SW)

      Knapman, Roger

      Shepherd, Colin (Hereford)

      Knight, Greg (Derby North)

      Shepherd, Richard (Aldridge)

      Knowles, Michael

      Shersby, Michael

      Lang, Ian

      Sims, Roger

      Latham, Michael

      Skeet, Sir Trevor

      Lawrence, Ivan

      Smith, Sir Dudley (Warwick)

      Leigh, Edward (Gainsbor'gh)

      Smith, Tim (Beaconsfield)

      Lennox-Boyd, Hon Mark

      Soames, Hon Nicholas

      Lester, Jim (Broxtowe)

      Speller, Tony

      Lilley, Peter

      Squire, Robin

      Lloyd, Peter (Fareham)

      Stanbrook, Ivor

      McCrindle, Robert

      Steen, Anthony

      Macfarlane, Sir Neil

      Stern, Michael

      McLoughlin, Patrick

      Stevens, Lewis

      McNair-Wilson, M. (Newbury)

      Stewart, Allan (Eastwood)

      Madel, David

      Stewart, Andrew (Sherwood)

      Malins, Humfrey

      Stewart, Ian (Hertfordshire N)

      Mans, Keith

      Sumberg, David

      Martin, David (Portsmouth S)

      Summerson, Hugo

      Mawhinney, Dr Brian

      Taylor, Ian (Esher)

      Mills, Iain

      Taylor, John M (Solihull)

      Miscampbell, Norman

      Tebbit, Rt Hon Norman

      Mitchell, Andrew (Gedling)

      Temple-Morris, Peter

      Monro, Sir Hector

      Thompson, Patrick (Norwich N)

      Montgomery, Sir Fergus

      Thornton, Malcolm

      Moore, Rt Hon John

      Thurnham, Peter

      Morris, M (N'hampton S)

      Townend, John (Bridlington)

      Morrison, Hon Sir Charles

      Tredinnick, David

      Moss, Malcolm

      Trippier, David

      Mudd, David

      Trotter, Neville

      Neale, Gerrard

      Twinn, Dr Ian

      Nelson, Anthony

      Vaughan, Sir Gerard

      Neubert, Michael

      Waddington, Rt Hon David

      Newton, Rt Hon Tony

      Wakeham, Rt Hon John

      Nicholls, Patrick

      Waldegrave, Hon William

      Nicholson, David (Taunton)

      Walden, George

      Nicholson, Miss E. (Devon W)

      Walker, Bill (T'side North)

      Onslow, Rt Hon Cranley

      Waller, Gary

      Page, Richard

      Wardle, C. (Bexhill)

      Paice, James

      Watts, John

      Patnick, Irvine

      Wells, Bowen

      Patten, John (Oxford W)

      Wheeler, John

      Pawsey, James

      Whitney, Ray

      Peacock, Mrs Elizabeth

      Widdecombe, Miss Ann

      Porter, Barry (Wirral S)

      Wiggin, Jerry

      Porter, David (Waveney)

      Wilshire, David

      Portillo, Michael

      Winterton, Mrs Ann

      Powell, William (Corby)

      Winterton, Nicholas

      Price, Sir David

      Wolfson, Mark

      Raffan, Keith

      Wood, Timothy

      Raison, Rt Hon Timothy

      Woodcock, Mike

      Rathbone, Tim

      Young, Sir George (Acton)

      Redwood, John

      Renton, Tim

      Tellers for the Noes:

      Rhodes James, Robert

      Mr. David Lightbown and

      Rhys Williams, Sir Brandon

      Mr. David Maclean.

      Riddick, Graham

      Question accordingly negatived.
      Amendment made: No. 22, in page 20, leave out lines 29 to 38 and insert—

      407
      `(b) that there is, in relation to each of the members of the union, who is accorded entitlement to vote in the ballot, some factor (whether or not the same factor) which—

      (i) relates to the terms or conditions of that member's employment or to the occupational description which is applicable to that member in his employment;

      (ii) is a factor which that member has in common with some or all of the other members of the union who are accorded that entitlement and have the same employer as that member; and

      (iii) in a case where there are individuals employed by that employer who are members of the union but are not accorded that entitlement, is neither a factor which that member has in common with any of those individuals nor a factor which individuals employed by that employer have in common as a consequence of having the same place of work;'.—[Mr. Nicholls.]

    Clause 20

      PROVISIONS SUPPLEMENTAL TO SECTION 19
      7 pm
      Mr. Nicholls: I beg to move amendment No. 14, in page 24, line 22, leave out 'or expenses which, (whether' and insert 'which.'.
      Mr. Speaker: With this it will be convenient to take Government amendments Nos. 15, 25, 17 and 18.
      Mr. Nicholls: Amendments Nos. 25 and 18 address concern expressed in Committee about the commissioner's ability to recoup his outlay from any award or settlement made.
      Amendments Nos. 15 and 17 ensure that subsections (2) and (3) express themselves in language appropriate to the legal systems of England and Wales and of Scotland respectively.
      Mr. Strang: We welcome the fact that the Government have tabled the amendments, some of which relate directly to concessions that we obtained in Committee. They are minor but they will be of some significant benefit to the trade union movement and we are grateful for them.
      Amendment agreed to.
      Amendments made: No. 15, in page 24, line 23, leave out
      'or an agreement or otherwise)'.
      No. 25, in page 24, line 26, leave out
      'so far as relates to any costs or expenses, on his rights'
      and insert
      'on any sum payable to the applicant'.
      No. 17, in page 24, line 33, leave out from 'of' to 'and' in line 34 and insert
      'any expenses which, by virtue of a judgement or order of the court, are payable to the applicant by any other person in respect of the matter in connection with which the assistance is provided;'.
      No. 18, in page 24, line 35, leave out
      'so far as relates to any costs or expenses,'. — [Mr. Nicholls.]

    Clause 23

      THE TRAINING COMMISSION
      Mr. Meacher: I beg to move amendment No. 19, in page 24, line 44, leave out clauses 23 to 28 (part II of the Bill).
      We now come to part II of the Bill. The Opposition deliberately formulated this amendment to delete the
      408
      clauses constituting part II of the Bill so as to ensure a broad debate on the Government's proposals for training for the unemployed as a whole. We would certainly agree that there has long been a need for major improvement in adult training for the unemployed, but in our view there are several fundamental objections to the way in which the Government propose to proceed.
      First, it should be recognised that by restricting the scheme to the unemployed they are making it very lopsided. Enhanced training for the employed is just as important, if not more so, but under this Government it has been run down to its lowest level for decades and is still being neglected. Britain now spends only just over 0·1 per cent. of its payroll on training to improve the skills of those in work, as compared with 2 per cent. to 3 per cent. in Germany and Sweden. There is a huge gap. Having dismantled most of Britain's training programmes, the Government are still ignoring the major part of the problem.
      Furthermore, there is a fundamental dilemma over funding at the heart of the proposals, which we believe will make them unworkable. It is proposed both to increase the number of participants by 50 per cent. and to upgrade substantially the quality of training, but to achieve both those considerable extra objectives within the same budget as before—£1·5 billion. Frankly, that is impossible. The aims can be reconciled only by very large cuts in the allowances payable to trainees, which will severely impair incentives and fatally damage any prospect of a voluntary scheme. Once compulsion is introduced to overcome the consequences of inadequate funding, the whole character of the proposals will alter for the worse. There is risk that the scheme will be a monumental flop like the job training scheme, and for similar reasons.
      The Secretary of State for Education and Science has talked about extending freedom of choice for young people, while the Secretary of State for Employment has favoured compulsion for the youth training scheme, which will sour the whole atmosphere of the scheme. If the Secretary of State of Employment is not to do the same for adult training, he must put his money where his mouth is. That will mean a substantial lift in the current budget ceiling. If the scheme is to remain voluntary and adequate incentives are to be provided for trainees, it is sheer fantasy to talk of enhanced high quality training—as the report does and as the Secretary of State does—without any increase in funding.
      Paragraph 6.12 of the Manpower Services Commission working party report proposes £16 a week for the training component. I do not know whether the Secretary of State agrees with that, but it is plainly absurd for high-quality training. Moreover, a major part of the new proposal is the increased involvement of private employers who are to be offered £25 per week per trainee—the figure proposed by the MSC. That might be enough for cheap labour, but it is certainly not enough for enhanced training. Unless the Secretary of State faces up to the Treasury better than he has in the past, there are all the signs that the latest proposals will degenerate to provide the same kind of low-quality work placements as their predecessors.
      The community programme managers have already made it clear that the present training and job search content cannot even be maintained unless the current fee of £440 per place is increased. But with many more participants working full-time, more training aids needed, more space used and more heating, lighting and telephone

      409
      costs incurred, anything less than a 50 per cent. increase in costs is simply not viable. So far, the Secretary of State has turned a blind eye to the basic practicalities.
      The next issue is the fundamental one that participation in training schemes must he voluntary. The Secretary of State has denied the element of compulsion — it is amazing that he has done so—but the Government's approach is increasingly riddled with compulsion, as I shall show. First, clause 4 of the Social Security Bill brings compulsion into YTS; there is no question about that. Then there is clause 26 dealing with adult training programmes, in which at least the potential for compulsion is also apparent. Thirdly, there is restart, the tighter availability for work rules and claimants being referred to the claimant adviser, who certainly puts the strongest pressure on claimants to get off the register, even if not into a job.
      If there is the odd individual case of abuse—and of course there always will be—the Government can use the armoury of rules that they already have to prevent abuse of the benefits system. The legal powers available are already strictly applied. Section 20 of the Social Security Act 1975 specifically penalises claimants who have refused to avail themselves of a suitable opportunity of a place on an approved training programme. They are disqualified from receiving unemployment benefit for 13 weeks.
      The Government now propose to make that 26 weeks, which is a very long time to suffer a reduction of supplementary benefit from £18·75 — not itself exactly generous—by 40 per cent. down to £11·25. Anyone who has tried to live on £11·25 a week for six months knows that that is a fearsome financial penalty. If the authorities believe that a claimant is not available for work, they can withdraw benefit altogether.
      The evidence of those who decline to enter YTS or leave early shows that they do not deliberately become unemployed. Let me give one figure from the Government's own case. Of those declining a place on YTS—estimated by the MSC to be between 20,000 and 30,000 each year—fewer than 700 per year—2 per cent. to 3 per cent.—have had their benefit reduced for being voluntarily unemployed. There are powers to deal with the occasional case of abuse. No one challenges those powers, but there is no justification whatever for what is proposed in the Bill—the blanket and virtually automatic removal of benefit from all 16 to 17-year-olds. That is a completely different matter and we utterly reject the proposal.
      As I have said, the provisions of clause 26 will mean that the new adult training programme will be anything but voluntary. The clause means that few claimants will be able to exercise their judgment and choice about whether a training scheme is appropriate to their circumstances or whether it will lead to a better chance of finding work. We still believe that the provisions in the 1975 Act are right. Under those provisions, unemployed people did not have to enter a programme if they could establish that it would not lead to a better chance of finding appropriate work. That reasonable allowance in the scheme is now explicitly ruled out. Clause 26 means that an offer of a place on the new scheme will be unrefusable, regardless of the quality or appropriateness of the scheme.
      My next point is one that we did not raise in Committee. Any suggestion that voluntary work is an acceptable exit from this scheme, as is proposed in paragraph 5.37 of the MSC report, should be immediately
      410
      scotched. If it is not, some people could be forced on to the scheme by threat of the withdrawal of benefit and simply offered unpaid voluntary work as a follow-up. They will be deprived of payment if they do not join the scheme and deprived of payment afterwards if they do. That is intolerable.
      That brings me to the matter of employee status. Under the Employment Protection Act 1975, a worker has the right to take an employer before an industrial tribunal if he thinks that he has been unfairly dismissed for trade union activities. After six months' employment, an employee is entitled to written responses for a dismissal, and if that statement of response is untrue or inadequate, the employee is entitled to compensation. That sort of provision should also apply to trainees. It is vital that adult trainees should enjoy not only a safe and nondiscriminatory working environment, but that they should be free to undertake trade union activities, have the right to challenge arbitrary or unfair disciplinary procedures and should be allowed to appeal against unfair dismissal. That is not the case under the Bill.
      7.15 pm
      Introducing trainees to workplaces inevitably leads to an element of job substitution and displacement. Those things are on a considerable scale — greater than the Government have yet admitted. A study commissioned by the MSC shows that in 1986 the YTS had a job substitution effect of 17 per cent. A subsequent study published in the Employment Gazette in October suggested that job substitution in the YTS might be considerably greater. That is the Government's own official gazette and it speaks about a job displacement rate of up to 62 per cent. in establishments with fewer than 100 employees.
      In 1986, the Technical Change Centre Research Organisation found that nearly one third of the employers that it surveyed gave savings in labour costs as the motive for participating in YTS. A further 16 per cent. who did not expect to save on labour costs found that they did so. The survey also found that nearly one in five of the employers involved would have taken on employees if they had not recruited YTS trainees. That is 20 per cent. of the employers surveyed. Another 18 per cent. would have taken on extra staff at peak periods and others would have had to subcontract some work. That shows the displacement and job substitution effect of the YTS and it is very worrying.
      I shall now turn to the matter of the rate for the job. Last year, a YTS study gave estimates of the YTS trainees' output. They varied from £18 a week in mechanical engineering and £21 a week in construction to £36 a week in repair of consumer goods and vehicles and £33 a week in retail distribution. Those figures show the value of what are, supposedly, trainees.
      If we assume, not unreasonably, that adult trainees would produce at least as much and in some case considerably more, it can be seen that many trainees will make a net contribution to their placement employer's profits after the managing agents' charges of £4 to £8 per day have been deduced. For that reason, trainees should be paid not some flimsy little allowance but the proper rate for the job.
      The MSC claims that projects operating under the community programme will be able to continue as normal under the new programme. If that is true—and it is the MSC that says it—participants will be engaged in work

      411
      for the majority of their time, 60 per cent., and will spend only 40 per cent. of their time in directed training. That is less than half. Therefore, participants will be engaged in the same activities as the ones that they are now engaged in — producing goods and services of benefit to the community—but they will become trainees and will lose their rights as employees. The value of their work will be downgraded because they will not receive the rate for the job.
      If, as expected, the Government accept the proposed allowance on top of benefit—£10 plus an extra £1·95 for under 25-year-olds and £1·25 for married people without children—the amount will certainly not be sufficient to provide the motivation to join the scheme or to provide motivation on the scheme. There will be wide discrepancies of payment to participants, calculated at between £38 and £90 a week or even more. That is for people doing exactly the same work.
      The Government claim that payments will reflect need rather than the rate for the job. That is totally spurious because the Government have deliberately held down the community programme average wage of £67 a week. That would now be over £85 a week if it had kept up with inflation since the time the community programme was introduced.
      When the idea of the benefit-plus scheme for the longterm unemployed was originally suggested by the Chancellor of the Exchequer in his 1982 Budget, the premium suggested was £15. In the discussion on the Government's manifesto proposals during the recent election campaign, the then Secretary of State for Employment also suggested that the level of the premium would be about £15 a week. Therefore, £10 is a significant reduction on what the Government previously said, apart from being a major cut in present community programme payments.
      It is undeniable that the vast majority of people currently employed in the community programme will be substantially worse off than they are under the present rate-for-the-job wage. I shall give two figures to illustrate that. On average, men employed as ordinary workers on the community programme are £39 a week better off than they were on benefit. That is the difference between £28 and £67. Women workers are £35 a week better off. Those figures show just how much those people will lose because of the change to benefit-plus.
      Topping up is an important matter. The proposed income support arrangements will make effective topping up of wages difficult, if not virtually impossible. It will not enable unions to negotiate the full rate for the job, because, under the social security regulations, anything that a claimant receives over the additional £10 a week will be deducted pound for pound from his benefit entitlement. Similarly, spouses' earnings are likely to be deducted from a trainee's benefit-plus income. This will discourage employers from giving overtime or from asking people to work unsocial hours for higher wages or to work on Saturdays.
      The final issue that concerns us involves trade unions and local advisory bodies. At present, trade unions, local authorities, local businesses and others exercise a monitoring role in the delivery of MSC programmes to the area manpower boards. However, the MSC is now
      412
      proposing to replace the area manpower boards with a new structure of local advisory bodies, involving major changes, which have the Government's agreement.
      One directly related change is that individual trade unions will lose their powers to scrutinise and to withhold approval from existing community programme schemes. Under the new programme, trade unions will merely have the right to be consulted where they are recognised and appropriate, and
      "any difficulty arising in establishing a programme shall be referred to the MSC area manager who, if necessary, will invite one employer and one trade union member of the local board to assist him or her in resolving the disagreement. Only where the area manager agrees that jobs are threatened, the project should not be implemented."
      The size and composition of the new boards will, of course, reflect the changes in the commission itself, which has been deliberately biased by the Government in favour of the employers to humiliate and marginalise the trade unions. The boards are likely to be much smaller, with no more than 12 or 15 members. Again, employers will be in a majority, with the remainder of board members drawn from local authorities, trade unions, the education service and voluntary organisations. Significantly, the membership will be determined by the chairman, and who appoints the chairman? The Secretary of State. [Interruption.] Yes, no doubt it will be the Prime Minister, who is well known for spending much of her time, when she has some time to spare in the evening, looking through the patronage lists of the good and the great.
      The MSC working party report proposes that local action plans involve only employers, and not the unions. That is another attempt by the Government to push aside any contribution from the unions. I should point out that trade unions have an obvious and necessary input into all training matters. Trying to oust them for reasons of political dogma will simply scupper the whole project—as happened, and rightly so, in the case of the job training scheme.
      In conclusion, the co-operation of all sides — the trade unions, local authorities, voluntary organisations, and the area management boards as well as the employers—is essential if sufficient places are to be provided on schemes for long-term unemployed people. Such cooperation will be given if the Government adhere to the principles that I have outlined and, as a result, the scheme can be clearly demonstrated to be fair, effective and good for participants without damaging public service provision and employment. The principles that we have outlined—and nothing less than all those principles—should be the bedrock on which an improved training scheme can be built.
      The Secretary of State for Employment (Mr. Norman Fowler): Part II, which the hon. Member for Oldham, West (Mr. Meacher) seeks to remove, brings up to date the Employment and Training Act 1973, which created the Manpower Services Commission. The Bill brings that Act up to date because, in the 15 years since it reached the statute book, there have been considerable changes in the nature of our labour market, but at no time have the changes been as marked as they are now.
      The unprecedented growth in output of the past six years has resulted in the creation of nearly 1·5 million new jobs. Unemployment is falling. In fact, it is undergoing the largest sustained fall on record. The seasonally adjusted December figure was the lowest for five and a half years.

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      Youth unemployment is falling. It is down by one third over the past 12 months. There were fewer unemployed school leavers last September than in any September since 1974.
      Those factors have highlighted the need to develop fresh approaches to people and work, and they have given us the opportunity to do so. It is this opportunity to respond to the needs of the new labour market which the Opposition are now attempting to block.
      It is important to remind the House of the major change which took place last October—the establishment of an integrated employment service. Indeed, one of the most important aspects of part II is that it gives the Department of Employment the powers to operate the service for the longer term.
      The new service seeks to bring together the work of the jobcentres and the unemployment benefit offices. Its main priority is to tackle the problem of long-term unemployment and to make sure that the unemployed get their fair share of the new jobs that the economy is creating. People who have been out of work for a long time clearly find it particularly difficult to get back into a job. They need special, individual help. However, under the previous system there was a risk that people attending only one of the two offices—either the unemployment benefit office or the jobcentre—could miss out on some of the services on offer. The new arrangements are designed to close that gap.
      The new employment service is already, through the work of restart counsellors, implementing our commitment to provide counselling for the long-term unemployed to help them into a job or training. People who have been unemployed for more than six months are now being given this assistance at six-monthly intervals. It is proving to be an effective form of assistance. In the 18 months that the programme has been operating nationally, about 3 million people have been interviewed and over 85 per cent. have received a positive offer in the form of a place on a community programme, in a job club or on a job training scheme, and the like.
      A second source of help provided by the employment service is the work of the claimant advisers. They can help to ensure that the person involved receives the right benefit. They can also show people with high benefit entitlement that it pays to work—[Interruption.] Well, the fact is—I think that we will be able to establish this even to the satisfaction of the hon. Member for Birmingham, Ladywood (Ms. Short)—that many of the people who currently turn down jobs are doing so in the mistaken belief that they will be better off on benefit. The new family credit which replaces the family income supplement in April means that virtually no one will be better off on benefit.
      Ms. Short rose——
      Mr. Fowler: I shall give way in a moment.
      I hope that, by re-integrating the jobcentres within the Department, we will clear the way for the new role of the Manpower Services Commission, which will now be called the Training Commission and which will provide a focus for our training efforts and will be directly responsible—
      Ms. Short rose——
      Mr. Fowler: If the hon. Lady will wait a moment.
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      It will be directly responsible for training provision which is financed by public funds, and it will have a wider remit to encourage training by employers for their own employees.
      Ms. Short: I am grateful to the Secretary of State for giving way. However, it is not good enough to misdescribe the changes that his Government have made through the availability for work tests and the claimant advisers, because unemployed people throughout the country know that those individuals exist to threaten and frighten them into taking up places on schemes that they do not find attractive. For the Secretary of State to stand at the Dispatch Box and say that those people are there to help is an insult to the experience of unemployed people in this country.
      Mr. Fowler: What the hon. Lady has just said is wholly untrue and wholly without foundation. She should be thoroughly ashamed of herself for putting forward that view. The fact is that one job of a claimant adviser is to seek to explain to people—surely there cannot be any conflict among us that the social security system is sometimes difficult to understand—what the benefits are, not just out of work but in work. The hon. Lady has just revealed the destructiveness of her attitude, which was exhibited throughout the whole Committee stage.
      The Training Commission will provide a focus for our training efforts. It will be directly responsible for training provision which is financed by public funds. I agree with the hon. Member for Oldham, West that there should be a responsibility on employers, which is why we are giving such a wide remit to encourage training by employers for their employees. I agree with the hon. Gentleman's first remarks that training for the unemployed is only one part of the issue; training for the employed must also be encompassed.
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      The theme of the work of the Training Commission must be and will be training through life. The aim will be to fit people for a labour market which will change substantially during their working lives.
      Of the clauses that the Opposition seek to remove, clause 23 enables me to appoint up to six additional employers to the commission. [HON. MEMBERS: "Why?"] Clearly employers are the major providers of training and employment. We cannot have an effective training strategy without industry, nor can we have an effective industry without training. My aim will be to appoint members from some of the areas of major employment growth—for example financial services, tourism and small firms. They will come not necessarily entirely from those areas, but from areas of that type where new jobs are being created.
      Clause 24 adjusts the powers of the commission to take account of its new training function and the establishment of the employment service. Together with the largely technical provisions of the clause is the new power to pay a YTS bridging allowance.
      Mr. Foot: The right hon. Gentleman says that when he enlarges the commission he will appoint some employers who represent new developments or industries. Why does he not appoint trade unionists from those industries in an equivalent number? The MSC was founded on the basis of that equality. It worked for a considerable time and, according to the right hon. Gentleman, it worked well.

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      Now he is unbalancing the whole arrangement and he has not given any excuse for it. Trade unionists are as interested as employers or anybody else in developing these new industries.
      Mr. Fowler: We set out these proposals clearly when we went to the country. We want to extend the representation on the commission because we believe that, in addition to its present members and make-up, there are others who can make a contribution in terms of their experience in job creation. Small firms are a classic area where there has been one of the greatest expansions in jobs. We should like to have someone from that area on the commission. There will still be trade union members on the commission. We have made no secret of the fact that we are not aiming for an equality of representation; we are trying to get the maximum amount of experience around the commission table for the creation of jobs.
      Mr. Foot: If the Bill goes through, naturally we shall want the Training Commission to be successful. Indeed, the whole future of our industry depends on the new training system, however it may be devised, being successful. If the Secretary of State is so determined about its success, why does he not preserve one element of the old system which proved so successful and give some proper recognition to the trade union contribution? He talks as though trade unions cannot make a contribution equivalent to that of employers, but of course they can. He has weighted the commission in favour of employers without any excuse, and some half-sentence in a manifesto is not a proper excuse. He should give the House the reason why he will undermine the MSC which for many years worked on the basis of equivalence.
      Mr. Fowler: The right hon. Gentleman may not accept my arguments, but I have given the reasons which he seeks. We are not doing what he accuses us of doing. We are not for a moment saying that trade unions do not have a contribution to make. That would be absurd. We are saying that others from outside not only the TUC but the CBI, have a greater contribution to make. They have experience of providing jobs in particular areas where over the past few years job creation has been most successful.
      Clause 24 provides a new power to pay a YTS bridging allowance. The new guarantee to all 16 and 17-year-olds of a suitable YTS place is crucial. The vocational training leading to a recognised qualification will now be the norm, not the exception. It will be a universal opportunity—not, as so often in the past, a privilege for the lucky few. We shall seek to give the options of full-time education, training or employment. One effect of the hon. Gentleman's proposals would be to prevent our offering young people the short-term allowance to ease the transfer from one YTS job to another.
      The provision of training for adults, both employed and unemployed, is not yet a match for our training of young people. Clearly, that is the most practical issue that the commission will have to address. A key aspect of its strategy will be the development of a new comprehensive training programme for the adult unemployed.
      I shall seek to make a statement to the House on that new adult training programme shortly and, clearly, hon. Members will be able to ask questions. The House will not expect me to go into intricate detail now, but I shall make a couple of comments about it.
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      Broadly speaking, the new programme, for which the Government will be making available more than £1·4 billion, will have two objectives. It will aim to equip the unemployed, particularly the long-term unemployed, with the skills they need to re-enter and make the fullest possible contribution to the new labour market by providing a mixture of directed and practical training and by placing as much reliance as possible on training with employers. That is the best way to ensure that training meets the needs of industry. From the trainees' point of view, it is also the best way to help them get a job at the end of the programme.
      Mr. Meacher: Could the Secretary of State get away from his gramophone record speech and perhaps answer one or two of my specific questions? How is it possible in the same budget to increase the number of participants by 50 per cent. and to produce enhanced high quality training without so cutting back the level of trainee allowances as to reduce the motivation for people to join the scheme, leading to compulsion to ensure that the places are taken up, which will sour the scheme?
      Mr. Fowler: I come precisely to that matter. The first point to make in response to what the hon. Gentleman said is that he is under a misconception about what the £1·4 billion refers to. There are 500,000 people under training, not the 400,000 that he has been quoting. The 400,000 refers to a previous year of training.
      The second aim of the new programme is to ensure that all unemployed people have an incentive to participate in it, which is why we are seeking to move from the present system of payment to an allowance based on benefit entitlement plus a premium. I accept entirely the hon. Gentleman's point that the success of the new programme will depend on its ability to deliver high-quality training.
      First, we will convert the £1 billion a year spent on temporary work projects in the community programme to money to be spent on training. That is an enormous turnaround. Secondly, the new programme will bring together more than 30 schemes that the MSC runs. As a result, we will be able to do away with wasteful divisions and complexities in the current arrangements and instead will have a simpler, more efficient and more flexible arrangement, ensuring better use of resources.
      Thirdly, the new programme will have the substantial budget of about £1·4 billion a year, which will enable 600,000 people to be trained each year. On top of that budget, the proposals of the MSC envisage employers contributing £150 million a year towards training costs. Almost all the contributions from employers will be new money and will therefore provide a further means of enabling training quality to be enhanced.
      Fourthly, I have said many times that the proposals of the MSC — I accept what the right hon. Member for Blaenau Gwent (Mr. Foot) said about the MSC—are its unanimous recommendations for training 600,000 people a year with £1·4 billion from the Government.
      Ms. Short rose——
      Mr. Fowler: If I could go on.
      The MSC's proposals are not for a cheapskate scheme but for a programme delivering high-quality training. The MSC has proposed built-in measures to ensure that the quality standards are achieved and maintained. Approved status against set criteria will be required of all training

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      agents and training managers. Inspections will be made by the training standards advisory service, and recognised qualifications will be offered wherever possible. The MSC would not have put forward its report unless it considered that all this could be done within the resources available. Therefore, I have no fears about the quality of the new programme.
      Ms. Short: I am sure that the Secretary of State would not wish to mislead the House. He set down parameters; he wrote to the Manpower Services Commission and said, "For this £1·4 billion you have to get 600,000 people through the scheme." The commission has come up with the best possible deal that can be got within those parameters. The Secretary of State knows, as I and many others know, that many trade union representatives on the commission have agonised about whether they are right to endorse that deal. They feel that perhaps they should stay in because they have got a few more pounds for the unemployed than would have been available without those trade union negotiators, but all of them are deeply unhappy about the proposed scheme. That is the truth.
      Mr. Fowler: I do not accept what the hon. Lady says. She again seeks, as she does in all her contributions on training, to destroy any consensus on it. It can hardly be denied that the MSC has made a unanimous report on the scheme. Whatever concerns there may be in the background, that is the most important point to grasp. The hon. Lady referred to the attitude of trade unionists, but it seems to me that their attitude is a darn sight more constructive to the proposals than is the attitude that she has shown in these proceedings.
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      Mr. Henry McLeish: The Secretary of State sent a letter to the commission on 18 September outlining the framework for the proposals. Did that framework include the sum of money and number of places he envisaged?
      Mr. Fowler: The framework included, from memory, the budget which was there; that is broadly correct. Of course, that was our proposition to the Manpower Services Commission, but it has had the opportunity of considering it and responding to it.
      I want there to be no mistake about this. I have endorsed the commission's recommendation that the new programme should be voluntary. I have no plans to designate it approved training for the purpose of benefit sanctions under section 20 of the Social Security Act 1975. The quality of the new programme and the guaranteed lead over benefit will provide a more than adequate incenitive to those who genuinely want to work. I agree with what the hon. Gentleman said; the vast majority of people want to work.
      Mr. Meacher: That is a very important point. Does the Secretary of State believe that a £10 lead over benefit, from which we have to deduct the £5 cost of work expenses that will not be covered—so it is a £5 lead over benefit—will offer a real incentive to hundreds of thousands of people, when the community programme allowance has not been increased in line with inflation and is some £20 or £30 higher than the level of benefit? Will not that constitute a huge disincentive to getting the numbers that the right hon. Gentleman wants and will it not lead remorselessly to compulsion?
      Mr. Fowler: It will not lead remorselessly to compulsion. I have made it clear that I have endorsed the commission's recommendation that the new programme should be voluntary, so I hope that that is understood.
      I shall refer to the details of the payment when I make my statement to the House. I am sure that the hon. Gentleman would not expect me to make a statement on that now. It must be common ground—I am not the only one to have observed this; organisations such as Youth Aid have observed it—that the present structure of payment for community programmes leaves out many married people with children simply because it does not attract the average of £67. In the end, the community programme is a part-time scheme, predominantly for young people. It leaves out many long-term unemployed people who are married and have families. We will seek to expand on those points in the White Paper and my statement on it.
      Ms. Short: Will the hon. Gentleman give way?
      Mr. Fowler: I will not give way again, but I will listen to what the hon. Lady has said. I want to underline the fact that the new programme is to be voluntary. I hope that that message, if no other, comes from this debate.
      Part II of the Bill, which the Opposition are trying to remove, provides the foundation of our strategy for employment and training. That strategy takes account of, and builds on, the many developments in the labour markets that have already taken place. That strategy looks forward to the labour market of the 1990s and, above all, to the skills that working people will need then. Trying to remove the provisions in part H is an attempt to turn the clock back to the early 1970s. That is a futile objective and I resist the amendment.
      Mr. McLeish: You will forgive me, Madam Deputy Speaker, for not giving the same account of part II as that given by the Secretary of State for Employment. Many of my hon. Friends and I believe that part II is so important and so bad that we want to delete—not amend — a whole section of a major Bill. That speaks volumes for our general concerns.
      Each clause in part II is significant and far-reaching, for the unemployed and for society in general. However, my hon. Friends are worried that part II is much more than the sum of its individual clauses. The debate is timely because, as the Secretary of State said, a White Paper on the new adult programme will be presented soon. Clearly, this legislation paves the way for the introduction of that programme.
      The Opposition stress that in the past nine years, training has become a devalued concept in the public's eyes because of the abuse heaped on it by the Government. Training has been discussed in great detail, hut, considering the serious or effective training in the United Kingdom, many people would doubt the validity of this Government using the training concept.
      Part II provides a fascinating insight into Government thinking about the unemployed. It marks a watershed in the consensus that has existed over the past few years in our ability to identify problems and, one hopes, come up with constructive measures to tackle them. I also believe that part II represents a fundamental shift in the attitude of Governments since the war to those problems. Clearly

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      it identifies a positive merging for the first time of the social security benefit system with the provision of temporary work and temporary training programmes.
      To use an ugly word, it is workfare. That concept has been imported from the United States. It is alien to the unemployed — I notice that the Secretary of State is shaking his head. I understand that he will be visiting the United States at Easter to study what is happening in more detail, and many of his colleagues have already been to the United States. For the first time, the unemployed will be subjected to social security payments and poor-quality training.
      While Ministers stand at the Dispatch Box and speak very plausibly about the needs of the unemployed and the sincerity of the Government's approach, they have adopted a sinister, pathological approach to the unemployed. The Government are not concerned about problems with the economy. The Government's proposals have nothing to do with the fact that there are still 2–6 million people on the dole, 500,000 young people forced into YTS and another 600,000 people about to embark on the new adult programme. The Government are not concerned with economic policies. They are telling the unemployed, "Look, we are helping you out because your deficiencies have created your position." That smacks of the old Poor Law mentality that some of my older colleagues may recall—although perhaps that is before their time.
      This is a fundamental shift in the Government's approach to unemployment and training — — [Interruption.] The Secretary of State is obviously enjoying my contribution, so I will probably speak for at least three hours longer than I had originally envisaged.
      Why are we suggesting that the whole of part II should be deleted? Let us consider part II in detail. Not many Conservative Members present today were in Committee. For their benefit, I will explain that clause 23 suggests that the Manpower Services Commission should become the Training Commission. That is fine. There is no problem about that. However, as my hon. Friend the Member for Oldham, West (Mr. Meacher) has said, that Training Commission will be packed with employers' or quasi-employers' representatives. No justification has been given for that. Those changes undermine the MSC's status and they are an attempt to smash the tripartite arrangements and the consensus that existed for many years about those specific problems.
      Clause 24 is interesting. It introduces the bridging allowance concept. The Government are guaranteeing every young person a place on the new programme. However, they have come up with the idea of an eight-week allowance at £15 a head in case young people do not get a place as quickly as the Government guarantee. That is obviously necessary because of the outrageous proposal contained in clause 4 of the Social Security Bill, which intends to withdraw the general entitlement to benefit from 16 and 17-year-olds. The Government create one mess and put forward another in its place as a sop to young people who, when they leave a programme or a job, find difficulty getting another.
      Clause 25 is sinister. It allows the Secretary of State to take dramatic powers to control the destiny of young people and adults in any designated training programme. It affects conditions and pay and it means that
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      unprecedented decisions can be taken by the Department. There will be no decentralisation, but the Secretary of State will designate groups, and his power will mean that young people's status, conditions and pay will be affected, as my hon. Friend the Member for Oldham, West said earlier.
      Clause 26 deals with the compulsory element with the amendments to the Social Security Act 1975. It is outrageous for the Secretary of State to suggest that this measure is all about sweetness and light and the willing hand of Government seeking to help people in difficulties. While the plausibility may be accepted by people who understand nothing about training, the young kids at the sharp end in Scotland, Liverpool, Birmingham and London will feel very sour when they hear those comments as the reality is more difficult than the Secretary of State is willing or able to accept.
      What is the real reason for the Opposition voting to support amendment No. 19? We will vote for it because of this sequence of events. Part II seeks to emasculate the MSC. It builds on the withdrawal of the genuine entitlement to benefit of 16 and 17-year-olds. That age group is isolated, vulnerable and prey to the sort of policies and programmes envisaged in the Bill. I have already referred to the Secretary of State's remarkable power to intervene on the status of young people. I believe that all the powers in part II mean a dramatic intensification of the states power to meddle, interfere and coerce and to make compulsory many things that people believe should be voluntary because they are all related to personal choice.
      I am a new Member. I have been involved in training and was a member of a manpower area board. I carried out consultancy work with young people and I have a passionate interest in education. However, as a result of the Secretary of State's delivery at the Dispatch Box and the contributions in Committee, I am fundamentally worried that we are returning to a Poor Law philosophy on the back of workfare. The Government have adopted a punitive approach to people who do not fit into this expanding economy that we hear so much about. I have already referred to the individualistic approach — blaming those who do not fit in and no one else.
      The Secretary of State said much about the expansion in the number of jobs and the labour market. However, there are more part-time jobs in that labour market. People receive less pay in that labour market than they did three or four years ago. I accept that the labour market is changing, but many young people will not be too willing to enter the labour market that has been created by this Government.
      I want to make a serious point about the Government's attack on the unemployed. We have been told that there must be co-operation for the new adult scheme to work. As my hon. Friend the Member for Oldham, West said, many groups including voluntary organisations and local authorities are among the most important providers. The Secretary of State said that, if employers are providing enough training, the providers must be considered and the MSC area boards will be packed to allow that to happen.
      If the Secretary of State cannot get the co-operation of voluntary organisations and local authorities, the new programme is dead. Over 90 per cent. of places are provided by these two sponsors. If the Secretary of State treats with contempt the representations they have made, there will be a sad outcome for the unemployed. It is not the Labour party which will suffer but the Government,

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      who are so arrogant and so devoid of sanity that they are willing to jeopardise a £1·5 billion programme because of the dogma and prejudice enshrined in part II of the Bill.
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      It is regrettable that we have reached this stage in relation to a group of people who need a radical, imaginative and innovative programme. People are apprehensive. If the Bill is enacted, their apprehensions will be reinforced. If the White Paper which the Secretary is to present contains some of the proposals which we suspect it will, I fear for the future of the new programme.
      The Secretary of State has talked about the new labour market. We have heard about a refreshing change and policies designed to complement what is happening in society. In reality, Britain is fast becoming a country where quantity is overtaking quality. Germany, France, Denmark and Sweden are all approaching the problem positively, with policies to tackle the industrial needs of those in work and those out of work. In Committee, my hon. Friend the Member for Ashfield (Mr. Haynes) was always talking about the Secretary of State's visit to Sweden.
      My hon. Friend the Member for Oldham, West (Mr. Meacher) has said that we have the worst trained work force in Europe. In comparison to the OECD countries, our record is even worse. Some countries whose industrial performance we might laugh at have more effective industrial training policies. That is the economy which Government Members ask us to contemplate. If we are serious about training for adults and for young people, in work or out of work, we must start learning a lesson from countries which provide dramatic examples of what can be done.
      When we have discussions about training, we should remember the regional imbalances. It is fine for the Secretary of State to say in this Chamber in London that all the young people in Westminster can find jobs as soon as they leave school. Young people in my constituency do not have that luxury. Parents are desperate to find work for their children. It is the same in Wales and in the regions. We will be viewed with suspicion if we spout in this Chamber about conditions in London when things are so different when one drives 20 or 30 miles from here.
      As for sex, race and disability, many fine words have been spoken about equal opportunities. I hope that, when the Secretary of State presents his White Paper, he will cover those points.
      If the Government are as serious about training as we are, they should say so. We want the Government to regard training not as an alternative to the dole queue but as important in itself. Any self-respecting industrial nation wants to invest resources in training. When the Secretary of State replies to the debate, I want him to say that the Government are taking training seriously, but not as a sop to the dole queue. If there is one thing a young person or an adult does not like it is being made to feel that he is being used, with no end product as a result.
      I ask the Secretary of State to accept the simple proposition emerging from the Manpower Services Commission, from the Labour party and from other groups which could not be classified as political. When will we get out of the rut of producing narrow-based, high-volume programmes for kids, young people and adults? Has the Secretary of State any self-respect when he says that we can spend £1.5 billion on 600,000 people and then
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      talk about real quality? I cannot believe that that is a reality. If we are serious about wanting people to have respect for what the Government are doing, that is not how to do it.
      "Freedom", "independence" and "choice" are words that trip off the tongues of Ministers on every subject. What freedom, what independence and what choice are there for many young people and adults who are victims of economic policies beyond their responsibility? It cannot be right to talk about a choice for kids when the Government are withdrawing university places and treating further education provision with contempt, and when they have smashed apprenticeships and job opportunities for many years. Some people may regard that as choice, but I do not believe it is. That is why there is cynicism and great disrespect for the Government's provisions.
      Mr. Geoffrey Dickens: I came into the Chamber to listen and not to speak, but I think that there are important things to be said from the Government Benches to Opposition Members who in many cases are rehearsing arguments which they have gone over in Committee.
      I have been saddened by some of the contributions. We have heard talk of cheap labour, of insufficient benefit and of trade unions not having enough say. Opposition Members should remember that the Government have no money; it is the taxpayers' money, which has to be used sensibly. The greatest motivation for a person is not how much money he will be paid while he is training but what the prospects will be at the end of the training, when he has gained new skills which one hopes will lead to a permanent job so that he may marry, have a family and perhaps purchase his own home. These are the things that motivate people towards getting proper permanent jobs rather than false jobs.
      It is not so long since the Opposition were always reminding us that training schemes were a way of disguising the unemployment figures. We do not hear much of that now, because our Action for Jobs programme happens to be working very well. The Conservative Government have come up with schemes that were beyond the wildest imagination of the Opposition. In the Labour party manifesto at the general election, we did not see much evidence of what it would do. The Conservative Government, with their Action for Jobs, are getting people back to work and are training for the needs of industry.
      Hon. Members should realise that industry in this country is taking off faster than in the rest of Europe. If we do not have training schemes, we will not have people with sufficient skill in the right industry to take up the positions that will be on offer. Let us make no mistake: the hon. Member for Oldham, West (Mr. Meacher) gave me the impression that he would rather pay people a large benefit to sit at home doing nothing. Yet Action for Jobs provides all sorts of options.
      Taxpayers should not be expected to support someone who is not prepared to help himself by taking up the option of training. Opposition Members talk about availability for work. I suppose they have all heard of the black market. The black market means that someone is claiming benefit and working at the same time. They are

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      squeezing the taxpayer in two ways. First, they are not paying taxes and, secondly, they are drawing benefit that the taxpayers are paying for.
      We are putting forward sensible and helpful solutions. We hear all this nonsense about pouring in money in order to motivate people to go on training schemes, and we hear nonsense about the level of benefit paid during the time spent on those schemes. The motivation that people under training need is the prospect that their new and extra skills may lead to a permanent job. That is what the Conservative Government stand for, and that is what they are doing.
      Mr. Ron Leighton: The hon. Member for Littleborough and Saddleworth (Mr. Dickens) obviously approaches these matters in a deeply philosophical way, which leads me on to the few comments I want to make.
      Part II uproots and mutilates the MSC. I do not think that that is an excessive way of putting it. It takes 11,000 officials from the MSC and puts them in the Department of Employment. It also takes considerably more than £500 million from the MSC and transfers it to the Department of Employment. Therefore, it is not excessive to say that the MSC is being uprooted and mutilated. That must be the result of the new philosophy and new approach to these matters.
      The Secretary of State referred to the debate in 1973. The other evening I could not sleep very well so I read the Hansard for 1973 which contains the debate in which the MSC was set up. I find a completely different atmosphere in the Chamber now. The Secretary of State was then Maurice Macmillan. He explained the new idea of a labour market organisation that would not be controlled by the Government. He said that it would be independent. It would be an organisation of the partners in the labour market — the employers, the trade unions, the local authorities and the education authorities. The Government were to have a hands-off approach. That was the novel concept adumbrated by Maurice Macmillan.
      If hon. Members read that debate — I recommend them to do so— they will see that there was one Conservative Back Bencher, the present Secretary of State for Northern Ireland and a predecessor of the current Secretary of State for Employment, who could not understand the new concept. He could not understand how we could set up a body that was not controlled by the Government. It was not an easy concept, but Maurice Macmillan sought to explain how it would be possible. My right hon. Friend the Member for Doncaster, Central (Mr. Walker), now a Deputy Speaker, spoke from the Labour Front Bench. I will not mention the other Labour Front Bench spokesman of the time.
      There was a consensus in the House. It was a bipartisan issue. Everybody agreed with what we were trying to do in those days. How different it is today. Look at the atmosphere in the House today. This is the new approach, the new Conservative party. It is completely different.
      We are adding six extra employers to the MSC. I am all in favour of the employers, but no one has explained to me why there will be six extra employers and not six extra trade unionists. After all, as the MSC has explained,
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      it does not proceed by voting. If we have to decide by voting, we might as well not have an MSC. It does not do things that way.
      The only time I know that the MSC had a vote was when the skill centres were axed. The proposition was carried by one vote. The representative of the education interests who originally supported it was a Scotsman. He later said he had made a mistake and wanted to change his vote. However, it was too late. The MSC does not proceed by voting. Perhaps it is like the Cabinet. There are bodies that do not proceed by means of votes, because if they did the whole thing would break down.
      8.15 pm
      Since then, the Government have increasingly changed the nature of the MSC and leaned on it in a way that is pushing it to destruction and into something completely different. My hon. Friend the Member for Birmingham, Ladywood (Ms. Short) talked about the agonies of some trade unionists on the MSC. They have been put under great stress. The Government have been giving instructions to the MSC. For example, the youth training scheme was set up after an instruction from the Government. They did not consult the MSC and ask whether it thought that the scheme would be a good idea. I do not blame the present Secretary of State for that, but that is how it happened.
      The MSC do not like what the Government are doing to it. As the Secretary of State knows, the MSC wrote to him on 23 July. I have seen the letter and I hope that I will receive a copy of his reply to the MSC, which said:
      "We are saddened by your intention and you would not expect us to be otherwise."
      The letter was written by Sir Bryan Nicholson. He has gone now. He went rather sadly and is now doing something else. The letter went on:
      "From the very earliest days of the Commission we have set great store on establishing and maintaining an attractive public Employment Service".
      It has tried to set up an "attractive" service, not a compulsory one. It has not said, "If you do not go on this scheme or take this job, you will not receive any benefit."
      The letter goes on to say that the MSC wants to offer a service that
      "provides employers, not least small firms, with an efficient service offering them the best value for money… treats individual job seekers and job changers"—
      that is good—
      "in a way they have a right to expect in a modern society."
      They are not to be treated as criminals, convicts, recalcitrants, spongers or scoundrels, but, to use the words of the MSC, as
      "they have a right to expect in a modern society."
      The letter also mentions the disabled and says that the MSC wants to provide
      "an attractive gateway to other opportunities."
      The sense of that letter is that the MSC does not trust the Government to do that. It does not trust the Government to provide an "attractive" employment service. We will have to see. It may be a little coded, but that is what the MSC is saying. The letter says:
      "we urge you to pay the closest possible attention to the following matters which could be at risk in what will inevitably be a protracted and difficult organsiational transition."
      I will not read too much of the letter, but I shall mention two things. The MSC says that it is worried that, if the service is too closely identified with benefit payments

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      and benefit claimants, employers might not wish to use the service in the future. The employers might not like it if it is based on benefits, compulsion and other such aspects.
      The letter states:
      "Management and staff of the functions you propose to transfer will need to be reassured that the move is not a prelude to privatisation, to further staff cuts, or to changes in their terms and conditions".
      I do not know whether they have received those assurances. The Secretary of State said that he had received a unanimous response. I think that that was so. What was said in that unanimous response? The MSC says that participation in the new scheme should be voluntary and that unions should have a significant say in whether individual schemes receive approval.
      Every community programme must have union approval, but will that still be the case? If not, there will be trouble with that programme. We saw what happened to the job training scheme. The TUC did not approve of that and it was a complete flop because there was no consensus. That is likely to happen again, if we rush at things in a headstrong way and if we do not have any consensus and ignore the TUC.
      The MSC report to the Government states that existing schemes have failed to live up to expectations. A few days ago, I received a copy of the February issue of Personnel Management. I do not know whether other hon. Members have read it, but it is a good publication. It refers to the MSC report to the Government, which stated:
      "All the commission's research and experience show that many of the unemployed are sceptical and hostile towards Government programmes.
      All of the present and past programmes have had their value and continue to do so. But, taken together or taken separately, they leave gaps or fail, in different ways, to measure up to the needs of the time or the hopes and aspirations of the long-term unemployed."
      The Secretary of State must not spoil the ship for a ha'p'orth of tar by skimping on the money involved. Extra people will go on to the scheme without extra money.
      We do not have the same level of training as other countries, not because the Government do not put in the same amount of money as West Germany, France or the United States, but because British companies do not put in sufficient money. Every Secretary of State for Employment that I have known has lamented that fact. If the present Secretary of State needs to be convinced, he should talk to his new Parliamentary Secretary, who is an expert on this subject.
      How can we encourage British employers to invest in people? Foreign companies recognise the benefits of doing that. They invest up to 5 per cent. of turnover, yet the average input in British industry is 0·3 per cent. The Government are financing schemes, but I urge them not to skimp and ruin the schemes.
      The commission proposes that, in addition to the £10 a week premium, participants should be paid travel costs of over £5 a week. They should also be given any lodging expenses, as well as assistance with other necessary items, such as special clothing and tools. There would also be a payment of up to £50 per week to meet the child care costs of single parents. I accept that the Secretary of State cannot give the precise figures today, but even £10 is more than the Department was wanting to pay. The unemployed are now allowed to earn up to £4 a week.
      Mr. Clay: Does my hon. Friend agree that even that is a little deceptive? Most people's travelling costs will be
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      above £5 and will therefore have to come off the £10. The trainee will have to pay those costs himself so, in reality, the sum is not even £10.
      Mr. Leighton: I do not understand how this will be done but, at present, the unemployed are allowed to earn £4 a week without losing benefit, so £10 is really £6. The Department of Health and Social Security estimated about £7 for the costs of travel, clothing and food. That should be added. Instead of driving this sum down, the Government would be well advised to be generous and to obtain full consent for these programmes. The value of the training is most important, but it will be a great mistake to screw down this payment and affront everybody.
      We are all in favour of a high-quality YTS scheme. An article in the October edition of the Employment Gazette dealt with the economic effects of YTS schemes. It referred to the deadweight effect of YTS places, that replace the jobs for young people which would have existed without YTS. It also referred to jobs for older workers which were replaced by YTS trainees. It then referred to output—in other words, value added—by trainees on YTS schemes. They go to work and they produce. What is the value of what they produce?
      The output of service industries—repair of consumer goods and vehicles, retail, distribution and personal services—is above the YTS rate of pay of £27·30, and the trainee produces more than £27·30. According to the article, the output of retail assistants is measured at £39 a week. If one produced £39 a week of added value and was paid only £27 one could describe that as cheap labour. A trainee could be brought in as a substitute for a worker who had been sacked. That is not a good aspect of the scheme.
      According to the article, some YTS trainees are being trained for skills that are not in short supply and could be met without YTS training. That applies particularly to YTS trainees in retailing, which has 25 per cent. of all trainees. Hotels have 7 per cent. of trainees and personal services, such as hairdressing, have 6 per cent. of trainees. Clerical trainees in all sectors account for 10 per cent. of YTS trainees. Those categories account for almost 50 per cent. of YTS trainees. Fifty per cent. of those trainees are in valuable schemes, but 50 per cent. are in schemes where they are not getting proper training, or in areas which are not in short supply.
      The quality of training in retail schemes is less than satisfactory. Several managers in those trades admitted that there would be little to teach second-year YTS trainees. Training for general shop assistants could be provided in a few weeks—for example, just by filling up shelves.
      We want a first-class YTS scheme. We want better quality training. The training allowance should be higher. It is not right to say that we have got everything perfect. We do not want a cheapskate scheme. If we could get a decent, high-quality scheme without cheap labour, we could have a bipartisan policy. Unfortunately, we do not appear to have one at the moment.
      8.30 pm
      Mrs. Golding: The Bill represents yet more centralisation of power, yet more power for the Minister, and the transfer of yet more power to the Ministry. At the moment, in the MSC, employers, trade unions, local authorities and educationists work together in a practical

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      way. They talk about things, people and places that they know. To them, they are real places, not just bits of paper in Ministry files.
      For many years, I sat as a trade union member on the old North Staffordshire district manpower services committee. I had a great deal of first-hand experience and knowledge of local training and employment needs. The committee dealt with matters by bringing together employers, trade unions, local authorities and educationists. They were not civil servants. Indeed, civil servants and people from the Ministry would not have had the kind of expertise that members of the Committee had. We knew north Staffordshire's needs.
      The former Member for Newcastle-under-Lyme was the Minister in the Department at that time. Many people in his Department were sceptical about the work of district manpower committees. Never one to duck an issue, the then Minister, the former Member for Newcastle-under-Lyme, said, "Right. We shall have a detailed survey of an area. We shall choose north Staffordshire." Departmental officials had relevant details. They went to all employers in the area. They went to schools and every other place that they could think of. They collected a great deal of material. When they had collated the material, they produced a little book and took it along to the committee.
      All that the 20 committee members had said were north Staffordshire's needs were stated in that book. With their survey and expertise, they did not find one matter that the committee, as local people, did not know. We in north Staffordshire talk to each other, we know each other and, furthermore, we like and trust each other. That is the best way in which to deal with training and employment. We know that training and employment go hand in hand, and that they should not be isolated from each other.
      Most certainly, the Department of Employment was responsible for some schemes, but look at what happened to them. The Department let them slip through its fingers. I refer to the job release scheme. Another scheme was put forward by the former hon. Member for Newcastle-under-Lyme. It was thought of by an ordinary working man who had practical experience. Perhaps the Minister should talk to more ordinary working people who have practical experience and get some better ideas for schemes. That scheme was scrapped because it was practical. It was a humane way in which to solve a problem, but it was scrapped because the Ministry is the Treasury's lapdog. It was far too practical and expensive for it.
      In the MSC, employers and unions have acted together to try to solve problems. The Ministry has now decided to change the balance of trade union and employer representation on the new committee. The strength of the MSC has always been that trade unions and the Confederation of British Industry have nominated people with a fierce pride in their areas and a determination to fight for their industries, services and workers. The Minister does not want fighters; he wants lapdogs. In future, he will choose people to sit on boards. That choice will not be for unions or the CBI. Oh, no—they are not to be trusted.
      The Bill will give the Minister yet more control, which is what he wants. So much for the Tory idea of local consultation. The clauses have nothing do do with good sense or industry and training needs. The Minister should withdraw them and think again.
      Mr. Tony Worthington: The hon. Member for Fife, Central (Mr. McLeish) spoke of how the Government have debased the term "training". I thought of my first job. I worked—I stress the word "work"—in a borstal, where I heard the governors's pep talk to new trainees. It was an interesting choice of words. He said, "You are not here for punishment, you are here for training." There was the loudest suppressed raspberry that I have ever heard. When we talk to youngsters, as many hon. Members and I did during the general election campaign, we use the word "training" and we know that we are using a word that has been debased.
      There is great concern about the consequences of the changes. I shall talk about the changes as they affect the adult training programme. There is probably much agreement among hon. Members about the present community programme. We are not happy that it is an overwhelmingly part-time scheme.
      Ms. Short: The Secretary of State would not give way on this point. My hon. Friend will remember that, when the Government introduced the community programme, which replaced the old community enterprise programme, they deliberately introduced much part-time work to keep the wage rate down to an average of £67. They are now using the excuse that, because part-time work produces low wages and therefore cannot attract people with dependants to the benefit-plus system, the solution is to provide full-time places within the scheme. They have manufactured a problem which they have solved by giving people, in effect, £5 on top of their benefit.
      Mr. Worthington: I am grateful to my hon. Friend for covering the next two pages of my speech. Her point should be made many times.
      Due to its design, the scheme became overwhelmingly part-time. Due to its design, older workers find the present scheme unattractive. There are faults in the scheme. Frequently, the community programme relates to work that is more properly done by local social and health services people. We would all agree that it was a major folly to introduce the community programme without an adequate training component. The Government now realise that fact, but they are not putting matters right in the way they should.
      Opposition Members agree that a major fault of the scheme is that wages started too low and, over time, have become proportionately lower. What do the Government do about the faults? They lower wages even further and convert the programme into a full-time programme by using DHSS money, rather than facing up to the inadequacy of funding. They then say that training should come from the same inadequate budget as before.
      I particularly refer to the Government's complete indifference to the consequence of their policy changes on present users of the community programme, those who sponsor the community programme, and its clients. Frequently, its clients are among the most disadvantaged people in our society, for whom the community programme, whatever its faults, has been used by voluntary organisations and local authorities to give services to the elderly, mentally ill and handicapped. I find the Government's indifference to the consequences of these changes disturbing.
      It is all very well to say that, in future, the adult training programme, the community programme with a future,

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      should be private-sector led. Where is the private sector in my constituency? The Minister must return and tell us where these training places will come from. At present, more than 90 per cent. of the community programme places in Scotland are local authority or voluntary organisation-led. Who will come forward from the private sector in areas in which unemployment is 20 per cent. and higher, and in which there is no local economy?
      Where is the private sector that will employ—that word is not a term to be used any more—people and provide these training places? I have corresponded with the Minister about this. Will supermarkets and the retail sector be the leaders, as my hon. Friend the Member for Newcastle-under-Lyme (Mrs. Golding) mentioned in connection with the youth training scheme? Will supermarkets and other large stores provide training places?
      We already know that the Government pay the wages of much of the private sector through job substitution on the youth training scheme. The people of this country subsidise private industry by paying the wages of those firms. That will happen under the adult training programme, too. The workers in retailing, the members of the Union of Shop, Distributive and Allied Workers, are alarmed that, in an industry in which jobs are increasingly low-paid and part-time, they will be squeezed out by the adult training programme.
      The private sector does not exist in my area. The combination of job scarcity and social deprivation in my constituency means that community benefit projects are especially valuable.
      I come now to the consequences of the Bill for the clients of community programmes. In the Clydebank part of my constituency, the MSC has, unbelievably, been the largest single employer. At one stage more than 1,000 workers were employed on community programme schemes in that area. I shall quickly list some of them. The first is a security project, sponsored by the local authorities and voluntary organisations in the area, which greatly improves the quality of life for the elderly and disabled by giving them security in their homes. Crucial to the success of that scheme is the quality of its management and the motivation of its workers, as people are being allowed into private homes. What will the proposals do to the quality of such a scheme?
      What about the care of gardens schemes which are mounted by local councils for the elderly and the disabled, who take pride in their gardens but cannot manage them themselves? For there to be an adequate contract between the people who receive and the people who run that service, the people on the scheme must be well motivated so that the project is well managed. In my area there is a small converted doctor's surgery, which local people have run as a day centre. It is called "The Wee Hub" and it has been established by local people with MSC funds as a day centre for the elderly. They struggle to make it run—they have to keep on changing the staff—but the staff that they find are well motivated and are not induced to be there by the pittance that comes in.
      What about the link schemes in the Glasgow area, where 35 workers provide a service for literally thousands of people who have been mentally ill? Once again, the quality of the scheme is crucial. If I had had my way the community programme would never have been allowed near such schemes. It is fundamentally unsuited to them,
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      lacking, as it does, trained workers, and receiving annual funding, but the voluntary organisations have made the scheme work.
      Above all, what about the Crossroads care attendance scheme — 23 MSC-funded projects that provide assistance to those who care for the elderly and the handicapped? The scheme brings in £1·5 million from the MSC each year. Workers go into homes and look after people's nearest and dearest. What will happen to the quality of that scheme? The Government's response is one of total indifference.
      8.45 pm
      The impact of MSC expenditure in Scotland is considerable—£140 million a year. That compares with the Scottish Development Agency budget of £95 million a year. What is done with that money matters a great deal to the economy. The voluntary sector in Scotland is underpinned by £48 million-worth of MSC funds. Those resources are on a scale that the voluntary sector has never had before. That sector has enormously assisted the Government to make their community programme work; now, under these proposals, it will be kicked in the teeth for its co-operation.
      Mr. Clay: Before my hon. Friend moves on, does he agree that there is another angle to his important point about the effect on existing community programme schemes? It reveals the key to the Government's deception over this matter.
      I listened with interest to the list of projects that my hon. Friend gave; I can think of very similar ones in my area, where thousands of people are on such schemes. Some of those schemes—this is not to their detriment—now have nothing to do with training. Dial-a-ride and services for the disabled are two such schemes. The Government are trying to deceive us that the new schemes are about training—that is their excuse for workfare-plus and for cutting the rates of pay. The Government are telling the truth to the extent that the existing community programme schemes will go altogether. They have nothing to do with training. So it is not only a matter of the disappearance of the quality of some of the present schemes: they will disappear altogether if the Government stick to their pretence that they will all be about training from now on.
      Mr. Worthington: I am grateful for that point, and I shall take it further. The Government lack evenhandedness about training. A massive amount of training is needed in the caring industry, in which there would be employment in the Health Service, the social services and in social work. But that sort of work is ignored for training purposes. I emphasise that on the end of these valuable schemes are exceedingly vulnerable groups of people who have come to value their day centres and the people who visit their homes. The schemes have been introduced with no idea of caring for such people.
      I could understand it if the Department of Employment agreed that it needed to change the direction of the community programme and give it another focus in future, saying that it would safeguard people who are benefiting from the present schemes. Such schemes may not make sense as employment training, but as health and social work they make good sense.
      These schemes may or not survive, but even if they do, it will be with a chain gang of pressed personnel —

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      people whose motivation may not be of the highest. They will not be paid properly for the job and they will not be given the status of workers undergoing training. The Government have shown a total lack of credibility on the quality of that training and that means that the sensitivity of the schemes is attacked.
      Many of the schemes will not survive. The voluntary organisations will pull out, sometimes causing the collapse of the voluntary organisation itself. As is already occurring, civil servants from the Department of Employment will be obliged to write sick letters to the schemes, regretting that the schemes no longer meet the criteria and telling them that they should seek alternative funding from the NHS—they must be joking—or the local social work department, which suffers from the clawback arrangement whereby if it spends £1 it loses £3, or from the urban aid scheme, and when a scheme does so it is told it is not eligible because it is not a new project.
      Is the Minister aware of the sheer misery which the changes will cause? Even if the Department of Employment should not be picking up the schemes the Government have a collective responsibility. In Scotland, if the schemes do not survive, we are talking about £48 million in social services cuts.
      Where will the money come from to fund projects that are of immense value to the local community? I am pleased to speak in support of the Opposition's amendment which seeks to delete these clauses because of the damage that they will cause to these particular schemes.
      Ms. Short: We have had a useful debate and some important points have been made about the effects of part II. A number of contributions from the Opposition Benches have shown what a dishonest—I use the word advisedly—account of the changes the Secretary of State gave the House today.
      The Secretary of State pretended that there would be some great improvement in the employment services. He went on to describe changes that have already been made — the Department of Employment has taken direct responsibility for the jobcentres and so on, and restart and the rules on availability for work have been introduced—and then suggested that somehow the Bill was necessary to authorise those changes. That is false. The changes that the right hon. Gentleman has described have already taken place, so that is not a true account of part II.
      Let us look at what part II really does. It centralises power and control over training schemes in the hands of the Secretary of State and it takes away the power to be consulted that the Manpower Services Commission — the tripartite body that has been described — had. Secondly, it deliberately takes new powers to compel unemployed people to participate in low-paid schemes and then the Bill dishonestly calls work experience schemes "training". That is what part II is all about, and that is why we reject it.
      The Secretary of State is taking the power to appoint six extra commissioners. At the moment, three commissioners are appointed after consultation with the trade union movement, three after consultation with employers, two after consultation with local education authorities, and the chair is the personal appointment of the Secretary of State.
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      That will no longer do. That must be changed. The Secretary of State wants power, so he takes the power to appoint six extra people and they will be appointed to stuff the commission and ensure that it will be his lapdog.
      In Committee, at the request of several organisations representing disabled people, we asked that at least one of those six extra people should be a representative of disabled people. But no, that was not acceptable and the Secretary of State threw out our request.
      Not content with having taken control of the commission by stuffing it with his personal appointees, the Secretary of State has to take away powers that the Commission previously had. Under the Employment and Training Act 1973, the commission was asked to submit proposals to the Secretary of State on training and assistance for the unemployed. It was asked to submit the proposals to ensure that the activities of the commission were in accordance with proposals approved by the Secretary of State and to give effect to the Secretary of State's directions as repeated in this legislation. Therefore, under the 1973 Act, the Secretary of State had considerable powers. The commission could submit proposals, but he had to approve them, and if he wanted to, he could give directions.
      But the Secretary of State was not content with that. Having stuffed the commission, he takes all these powers to himself and away from the commission so that he holds the powers and can give directions to the commission about what it must do, or he can use some other body.
      The House should ask why we should have a commission at all. We know that when the right hon. Member for Chingford (Mr. Tebbit) was Secretary of State for Employment he made it clear that he did not like the MSC. It was widely thought that that might be because trade unions were represented on the commission and his intolerance and dislike of trade unions is clear to everyone. That is reflected in the earlier part of the Bill. He wanted to abolish the commission.
      My view is that the Government are, in effect, abolishing the commission and are retaining a fig leaf for as long as the trade unions will go along with that so that they can force through any scheme or structures that they want. As I said earlier, the trade union representatives on the commission are now constantly agonising about whether they should go because by staying they give legitimacy to schemes that are destructive and unhelpful to the unemployed, which encourage the use of the unemployed as cheap labour, substitution for other workers and the dragging down of wage levels, or whether it is better to stay and negotiate to make things a little better than would otherwise be the case.
      My personal view — I stress that — is that the Secretary of State is now seeking to humiliate the trade union representatives on the MSC with the changes in the Bill. It is time for them to leave the commission to seek to represent the interests of the unemployed and those who seek training through traditional trade union measures. I stress that that is my view. It is my serious view and it is no good the Under-Secretary of State, the hon. Member for Teignbridge (Mr. Nicholls), saying that that is a disgraceful view. Trade unions exist to seek to represent the interests of working people and to get the best for them.
      Mr. Fowler rose——
      Ms. Short: If the Secretary of State will wait a minute —as he always requests 0everyone else to do whenever they seek to intervene—I shall give way.
      The long-term unemployed are to be compelled to take part in schemes by threats that their benefit will be removed for six months if they refuse. They have to pay the first £5 of their expenses in getting to work. Therefore, they can be forced to work full-time for £5 a week. The dominant scheme will be work experience, based so that it will inevitably displace other other workers in a way that is described in the YTS statistics that have been put before the House. I do not believe that those proposals are in the interests of the unemployed or of other workers. The trade union movement should not support such things. It is better for them to get out of the commission and seek to defend the interests of working people in other ways.
      9 pm
      Mr. Fowler: The hon. Lady has made a serious suggestion. When she speaks from the Dispatch Box, for whom is she speaking? Is she speaking for the Labour party? Surely that is the purpose of speaking from the Dispatch Box. What is the status of her speech?
      Ms. Short: Perhaps the Secretary of State was not listening. He often does not listen to those who seek to work for the unemployed. I have made it clear that in this matter, this is a personal view. Everything else that I shall say will reflect the position of the Labour party from the Front Bench. I said before that this was my personal view, and I am entitled to put forward that view.
      Mr. Fowler: Will the hon. Lady give way?
      Ms. Short: I do not have to give way to the Secretary of State. He refused to give way to me.
      Mr. Fowler rose——
      Madam Deputy Speaker (Miss Betty Boothroyd): Order. The hon. Lady has made it quite clear that she is refusing to give way. I must ask the Secretary of State to resume his seat. The hon. Lady has twice made it clear that she is not giving way.
      Ms. Short: The Secretary of State refused to give way to me. He has such arrogance that he thinks that it is all right for him to stand at the Dispatch Box and refuse to give way but that somehow he is entitled to intervene whenever he wishes.
      Mr. Martin M. Brandon-Bravo: The House should have an answer. If the hon. Lady was speaking from the Back Benches, the House would happily accept that her words are her own personal opinion. However, I find it difficult to listen to the hon. Lady speaking from the Dispatch Box, dismissing her party responsibilities and saying, "This is my personal opionion." We want to know from the Front Bench what is the Labour party's opinion.
      Ms. Short: The hon. Gentleman has just repeated the Secretary of State's question to which I gave a clear answer. On the question whether the trade union movement continues to have representatives on the commission, I said that that is a matter for the trade union movement.
      Mr. Nicholls: What is the Labour party's view?
      Ms. Short: If the Under-Secretary would allow me to answer the question, everyone might be clear about it. I
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      have already answered it once, but Conservative Members were not listening, so I will answer it a second time, and then perhaps I can move on.
      Ministers and Conservative Members should understand that the representation of the trade union movement on the commission is fragile. Those in the trade union movement who sit on the commission agonise over whether they should continue to do so. I have had discussions with a number of people who hold those places. The representatives of the trade union movement have to decide whether to remain on the commission. My personal view is that the humiliation involved in part II of the Bill makes it no longer worth staying. Part II——
      Mr. Brandon-Bravo: What does the Labour party say?
      Ms. Short: The hon. Gentleman should stop being silly. Part II of the Bill takes power to pay a bridging allowance of £15 a week for only eight weeks to participants on the youth training scheme. That is necessary only because the Government have removed the right to supplementary benefit from 16 to 17-year-olds and have thus made the youth training scheme compulsory. We consider that a disgraceful move.
      Young people have participated voluntarily in the youth training scheme in enormous numbers. My hon. Friend the Member for Oldham, West (Mr. Meacher) made it clear that only very small numbers have been penalised for refusing a place on a scheme. One of the effects of that is to remove from young people the choice about which scheme to enter and what kind of training best suits them. It removes from young people with families on low incomes the choice to remain on supplementary benefit and to study for up to 21 hours a week. Indeed, 30,000 young people a year have been doing that. They have achieved 0-levels and A-levels, and some even went on to university. That option is to be wiped out. If young people need an income, they will be forced onto the youth training scheme. That is a complete outrage.
      Clause 26 takes powers to make the refusal of offers of places on low-paid training schemes—which under the new proposal, will pay £5 a week on top of benefits equivalent to the refusal of a job and to make it possible for the Department to refuse benefit for six months to people who refuse places on those schemes.
      We have heard a lot of equivocation from the Secretary of State about when he expects to use those powers. The report from the Manpower Services Commission about the adult training scheme said that the scheme must be voluntary, or those who proposed it would not support it. The Secretary of State says that he broadly accepts their proposals, but he refuses to withdraw clause 26. He keeps saying that he has no plans at present to designate the new scheme as a compulsory scheme under clause 26. No one would expect him to want to designate it at the present time. One would expect him to hope to get the scheme up and running to provide enough places and then designate it. His words imply that that is his plan.
      In Committee, we asked the Secretary of State to give an undertaking that he would never designate the scheme under clause 26. If the right hon. Gentleman is to respond to the recommendation of the Manpower Services Commission that the scheme must be voluntary, he should be able to give that undertaking. He has refused to do so. All he will tell us is that he has no plans, for the present

      435
      time, to designate the scheme. It seems a fair assumption that he will wait until the scheme is up and running—if he ever gets it—and then designate it.
      Long-term unemployed people will be forced to work for £5 a week on schemes that are basically work experience. The recommendation is merely that 40 per cent. of their time should be on directed training, but 60 per cent. of their training will be spent working, for which they will get £5 a week and no guarantee of any job at the end of it. They will have no guarantee that they will be given any skills to enhance their employment opportunities.
      The whole package of proposals in part II is deeply unacceptable. It means a serious diminution in the incomes and freedom of choice of the unemployed and in the MSC's powers. It means centralisation of power in the hands of the Secretary of State. That is why I invite my hon. Friends to vote that part II be deleted.
      Mr. Cope: I shall do my best to respond briefly to some of the points raised, but I make it clear that many of them concerned the new training programme for the unemployed—which is soon to be the subject of a White Paper and statement by my right hon. Friend the Secretary of State—rather than the Bill.
      Some hon. Members, but not all, have understood that the Bill carries forward, and to a degree rearranges, the powers under which existing schemes as well as proposed schemes such as the new training programme can be carried out. The Bill specifically provides for the MSC to carry on those programmes that it operates at the moment. It makes some changes to the commission, the aim being to raise the profile of training. There was considerable support on both sides of the House for that, although I understand that not everyone agrees with the methods that we propose. Employers are the major providers of training and the major customers for it. Employers create jobs, and they need to have a greater say in, and make a greater contribution to, training.
      Of course I do not agree with everything that the hon. Member for Newham, North-East (Mr. Leighton) said in this connection, but I do agree about the fundamental importance of improving training. That must be at the top of our industrial agenda and employers must do more to invest in their work force. That is precisely why we are renaming the MSC the Training Commission and seeking greater employer involvement with the commission and its aims.
      The Bill does not transfer the jobcentres, as the hon. Member for Newham, North-East seemed to suggest. That was done in October, as my right hon. Friend the Secretary of State made clear. It follows that the transfer is a separate arrangement and not a part of the Bill. I think that both sides of the House are united in wanting quality training schemes. That is extremely important. Unemployment is undergoing the largest sustained fall on record. Over the past six years, 1·5 million new jobs have been created, which gives us the opportunity, which we are anxious to seize, to help the unemployed find new jobs.
      The hon. Member for Clydebank and Milngavie (Mr. Worthington) made an interesting contribution, but he was wrong to say that we are indifferent to the type of schemes under the community programme about which he was talking. On the contrary, there will be project places
      436
      in the new scheme, but I must ask the hon. Gentleman to await the White Paper for more details. We are responding to many of the hon. Gentleman's criticisms of the community programme. It is said that much of the work is part-time, that it is unattractive to older workers and married people with dependants and so on.
      We are responding to those criticisms and to the lack of training in the community programme to which the hon. Gentleman and his hon. Friend the Member for Sunderland, North (Mr. Clay) drew attention. I thought that the hon. Gentleman came near to saying at one stage that some of the unemployed were incapable of being trained, although I would not wish to attribute that assertion to him if he does not agree with it. We certainly do not agree with that; on the contrary, we believe in making every effort to assist all the unemployed people that we can back into work.
      Mr. Worthington: I am at a loss to know which part of my speech the hon. Gentleman is referring to. I would never ever come anywhere near to saying that.
      Mr. Cope: I apologise if I am misrepresenting the hon. Gentleman. He argued for the community programme, which has to a considerable extent made work for people to fill in their time, and does not supply enough training.
      Other criticisms have been made of the community programme. Much attention has been devoted to the rate for the job and so on. The changes that we propose to the community programme and the benefit-plus scheme are no new ideas. I draw the attention of the House to the Youthaid report published in 1982 on what was then called the community enterprise programme, which was the precursor of the community programme:
      "Consideration should also be given to the possibility of payment on CEP calculated on a 'Benefit plus' basis. The CEP allowance would be topped up by Social Security or Unemployment benefit. This would have the advantage of ensuring that the CEP paid each worker the same amount while those with dependants would get more as a result of the variations in the benefits."
      That is an important criticism, made as long ago as 1982 when, I am informed, the hon. Member for Birmingham, Ladywood (Ms. Short) was director of studies for Youthaid. I do not know whether she agreed with what Youthaid said in its report on CEP. If she did, she has obviously changed her mind.
      Ms. Short: The research on the old community enterprise programme was funded by the Department of Employment. I was the director of studies and not one of the researchers. The recommendation came from the researchers. We discussed it at the time and, although it was not my view, the researchers had done the work and they were entitled to put the view forward.
      Mr. Cope: There has been some confusion tonight about which are the hon. Lady's views and which are other people's, and it helps to get matters clear.
      We believe that training should have a higher profile. We need to get employers more involved in training, and that is central to our proposals. We shall all learn more about the new programme from the White Paper and from my right hon. Friend's statement.
      Question put, That the amendment be made:—
      The House divided: Ayes 206, Noes 258.

      Division No. 177]

      [9.15 pm

      AYES

      Abbott, Ms Diane

      Graham, Thomas

      Adams, Allen (Paisley N)

      Grant, Bernie (Tottenham)

      Allen, Graham

      Griffiths, Nigel (Edinburgh S)

      Archer, Rt Hon Peter

      Griffiths, Win (Bridgend)

      Armstrong, Ms Hilary

      Grocott, Bruce

      Ashdown, Paddy

      Hardy, Peter

      Ashley, Rt Hon Jack

      Healey, Rt Hon Denis

      Ashton, Joe

      Heffer, Eric S.

      Banks, Tony (Newham NW)

      Henderson, Douglas

      Barnes, Harry (Derbyshire NE)

      Hinchliffe, David

      Barron. Kevin

      Hogg, N. (C'nauld &amp; Kilsyth)

      Battle, John

      Holland, Stuart

      Beckett, Margaret

      Home Robertson, John

      Beith, A. J.

      Hood, James

      Bell, Stuart

      Howarth, George (Knowsley N)

      Benn, Rt Hon Tony

      Howells, Geraint

      Bennett, A. F. (D'nt'n &amp; R'dish)

      Hoyle, Doug

      Bermingham, Gerald

      Hughes, John (Coventry NE)

      Blair, Tony

      Hughes, Robert (Aberdeen N)

      Blunkett, David

      Hughes, Sean (Knowsley S)

      Boateng, Paul

      Illsley, Eric

      Boyes, Roland

      Ingram, Adam

      Bradley, Keith

      John, Brynmor

      Bray, Dr Jeremy

      Jones, Barry (Alyn &amp; Deeside)

      Brown, Gordon (D'mline E)

      Jones, leuan (Ynys Môn)

      Brown, Nicholas (Newcastle E)

      Kennedy, Charles

      Bruce, Malcolm (Gordon)

      Kirkwood, Archy

      Buchan, Norman

      Lamie, David

      Buckley, George

      Lamond, James

      Callaghan, Jim

      Leighton, Ron

      Carnpbell, Ron (Blyth Valley)

      Lestor, Miss Joan (Eccles)

      Carnpbell-Savours, D. N.

      Lewis, Terry

      Canavan, Dennis

      Litherland, Robert

      Carlile, Alex (Mont'g)

      Livsey, Richard

      Clark, Dr David (S Shields)

      Lloyd, Tony (Stretford)

      Clarke, Tom (Monklands W)

      Lofthouse, Geoffrey

      Clay, Bob

      McAllion, John

      Clelland, David

      McAvoy, Tom

      Clwyd, Mrs Ann

      McCartney, Ian

      Cohen, Harry

      McCrea, Rev William

      Cook, Frank (Stockton N)

      McCusker, Harold

      Corbett, Robin

      Macdonald, Calum

      Corbyn, Jeremy

      McFall, John

      Cousins, Jim

      McKay, Allen (Penistone)

      Cox, Tom

      McKelvey, William

      Crowther, Stan

      McLeish, Henry

      Cryer, Bob

      McTaggart, Bob

      Cummings, J.

      Madden, Max

      Cunliffe, Lawrence

      Mahon, Mrs Alice

      Dalyell, Tarn

      Marek, Dr John

      Darling, Alastair

      Marshall, David (Shettleston)

      Davies, Rt Hon Denzil (Llanelli)

      Marshall, Jim (Leicester S)

      Davies, Ron (Caerphilly)

      Martin, Michael (Springburn)

      Davis, Terry (B'ham Hodge H'I)

      Martlew, Eric

      Dewar, Donald

      Maxton, John

      Dixon, Don

      Meacher, Michael

      Doran, Frank

      Meale, Alan

      Duffy, A. E. P.

      Michael, Alun

      Dunnachie, James

      Michie, Bill (Sheffield Heeley)

      Dunwoody, Hon Mrs Gwyneth

      Millan, Rt Hon Bruce

      Eastham, Ken

      Mitchell, Austin (G't Grimsby)

      Ewing, Harry (Falkirk E)

      Molyneaux, Rt Hon James

      Fearn, Ronald

      Moonie, Dr Lewis

      Field, Frank (Birkenhead)

      Morgan, Rhodri

      Fisher, Mark

      Morley, Elliott

      Flannery, Martin

      Morris, Rt Hon A (Wshawe)

      Flynn, Paul

      Morris, Rt Hon J (Aberavon)

      Foot, Rt Hon Michael

      Mowlam, Marjorie

      Foster, Derek

      Mullin, Chris

      Foulkes, George

      Murphy, Paul

      Fraser, John

      Nellist, Dave

      Fyfe, Mrs Maria

      Oakes, Rt Hon Gordon

      Galbraith, Samuel

      O'Brien, William

      Galloway, George

      O'Neill, Martin

      Garrett, John (Norwich South)

      Orme, Rt Hon Stanley

      Garrett, Ted (Wallsend)

      Parry, Robert

      Godman, Dr Norman A.

      Patchett, Terry

      Gordon, Ms Mildred

      Pendry, Tom

      438

      Pike, Peter

      Spearing, Nigel

      Powell, Ray (Ogmore)

      Steel, Rt Hon David

      Prescott, John

      Steinberg, Gerald

      Prirnarolo, Ms Dawn

      Stott, Roger

      Quin, Ms Joyce

      Strang, Gavin

      Rees, Rt Hon Merlyn

      Taylor, Mrs Ann (Dewsbury)

      Reid, John

      Taylor, Matthew (Truro)

      Richardson, Ms Jo

      Thompson, Jack (Wansbeck)

      Roberts, Allan (Bootle)

      Turner, Dennis

      Robinson, Geoffrey

      Vaz, Keith

      Rogers, Allan

      Wall, Pat

      Rooker, Jeff

      Walley, Ms Joan

      Ross, Ernie (Dundee W)

      Wardell, Gareth (Gower)

      Ross, William (Londonderry E)

      Wareing, Robert N.

      Rowlands, Ted

      Welsh, Andrew (Angus E)

      Ruddock, Ms Joan

      Welsh, Michael (Doncaster N)

      Salmond, Alex

      Williams, Rt Hon A. J.

      Sedgemore, Brian

      Wilson, Brian

      Sheerman, Barry

      Winnick, David

      Sheldon, Rt Hon Robert

      Wise, Mrs Audrey

      Shore, Rt Hon Peter

      Worthington, Anthony

      Short, Clare

      Wray, James

      Skinner, Dennis

      Young, David (Bolton SE)

      Smith, Andrew (Oxford E)

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

      Tellers for the Ayes:

      Snape, Peter

      Mrs. Llin Golding and

      Soley, Clive

      Mr. Frank Haynes.

      NOES

      Aitken, Jonathan

      Colvin, Michael

      Alison, Rt Hon Michael

      Conway, Derek

      Amess, David

      Coombs, Anthony (Wyre F'rest)

      Amos, Alan

      Coombs, Simon (Swinoon)

      Arbuthnot, James

      Cope, John

      Arnold, Jacques (Gravesham)

      Cormack, Patrick

      Aspinwall, Jack

      Couchman, James

      Atkins, Robert

      Cran, James

      Atkinson, David

      Currie, Mrs Edwina

      Baker, Nicholas (Dorset N)

      Curry, David

      Baldry, Tony

      Davies, Q. (Stamf'd &amp; Spald'g)

      Batiste, Spencer

      Davis, David (Boothferry)

      Beaumont-Dark, Anthony

      Day, Stephen

      Bellingham, Henry

      Dickens, Geoffrey

      Bendall, Vivian

      Dorrell, Stephen

      Bennett, Nicholas (Pembroke)

      Douglas-Hamilton, Lord James

      Benyon, W.

      Dover, Den

      Bevan, David Gilroy

      Dunn, Bob

      Biffen, Rt Hon John

      Dykes, Hugh

      Biggs-Davison, Sir John

      Evennett, David

      Blackburn, Dr John G.

      Fallon, Michael

      Blaker, Rt Hon Sir Peter

      Farr, Sir John

      Body, Sir Richard

      Favell, Tony

      Bonsor, Sir Nicholas

      Fenner, Dame Peggy

      Boscawen, Hon Robert

      Field, Barry (Isle of Wight)

      Bos well, Tim

      Forsyth, Michael (Stirling)

      Bottomley, Mrs Virginia

      Forth, Eric

      Bowden, A (Brighton K'pto'n)

      Fowler, Rt Hon Norman

      Bowden, Gerald (Dulwich)

      Fox, Sir Marcus

      Bowis, John

      Franks, Cecil

      Boyson, Rt Hon Dr Sir Rhodes

      French, Douglas

      Braine, Rt Hon Sir Bernard

      Gale, Roger

      Brandon-Bravo, Martin

      Gardiner, George

      Brazier, Julian

      Garel-Jones, Tristan

      Bright, Graham

      Gill, Christopher

      Brittan, Rt Hon Leon

      Gilmour, Rt Hon Sir Ian

      Bruce, Ian (Dorset South)

      Glyn, Dr Alan

      Buck, Sir Antony

      Goodlad, Alastair

      Budgen, Nicholas

      Goodson-Wickes, Dr Charles

      Burns, Simon

      Gorst, John

      Burt, Alistair

      Gow, Ian

      Butcher, John

      Gower, Sir Raymond

      Butler, Chris

      Grant, Sir Anthony (CambsSW)

      Butterfill, John

      Greenway, Harry (Ealing N)

      Carrington, Matthew

      Greenway, John (Rydale)

      Carttiss, Michael

      Gregory, Conal

      Cash, William

      Griffiths, Sir Eldon (Bury St E')

      Chapman, Sydney

      Griffiths, Peter (Portsmouth N)

      Chope, Christopher

      Grist, Ian

      Clark, Hon Alan (Plym'th S'n)

      Ground, Patrick

      Clark, Dr Michael (Rochford)

      Grylls, Michael

      439

      Gummer, Rt Hon John Selwyn

      Peacock, Mrs Elizabeth

      Hamilton, Hon A. (Epsom)

      Porter, Barry (Wirral S)

      Hanley, Jeremy

      Porter, David (Waveney)

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

      Portillo, Michael

      Hargreaves, Ken (Hyndburn)

      Powell, William (Corby)

      Harris, David

      Price, Sir David

      Hawkins, Christopher

      Raffan, Keith

      Hayhoe, Rt Hon Sir Barney

      Raison, Rt Hon Timothy

      Hayward, Robert

      Redwood, John

      Heathcoat-Amory, David

      Rhys Williams, Sir Brandon

      Heddle, John

      Riddick, Graham

      Hicks, Mrs Maureen (Wolv' NE)

      Ridsdale, Sir Julian

      Hicks, Robert (Cornwall SE)

      Roberts, Wyn (Conwy)

      Hill, James

      Roe, Mrs Marion

      Hind, Kenneth

      Rowe, Andrew

      Hogg, Hon Douglas (Gr'th'm)

      Rumbold, Mrs Angela

      Holt, Richard

      Ryder, Richard

      Hordern, Sir Peter

      Sayeed, Jonathan

      Howard, Michael

      Shaw, David (Dover)

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

      Shaw, Sir Giles (Pudsey)

      Howarth, G. (Cannock &amp; B'wd)

      Shaw, Sir Michael (Scarb')

      Howell, Rt Hon David (G'dford)

      Shelton, William (Streatham)

      Howell, Ralph (North Norfolk)

      Shephard, Mrs G. (Norfolk SW)

      Hughes, Robert G. (Harrow W)

      Shepherd, Colin (Hereford)

      Hunt, David (Wirral W)

      Shepherd, Richard (Aldridge)

      Hunt, John (Ravensbourne)

      Shersby, Michael

      Irvine, Michael

      Sims, Roger

      Irving, Charles

      Skeet, Sir Trevor

      Jack, Michael

      Smith, Sir Dudley (Warwick)

      Janman, Timothy

      Smith, Tim (Beaconsfield)

      Jessel, Toby

      Speed, Keith

      Jones, Gwilym (Cardiff N)

      Speller, Tony

      Jones, Robert B (Herts W)

      Squire, Robin

      Kellett-Bowman, Dame Elaine

      Stanbrook, Ivor

      Key, Robert

      Steen, Anthony

      Kilfedder, James

      Stern, Michael

      King, Roger (B'ham N'thfield)

      Stevens, Lewis

      King, Rt Hon Tom (Bridgwater)

      Stewart, Allan (Eastwood)

      Kirkhope, Timothy

      Stewart, Andrew (Sherwood)

      Knapman, Roger

      Stokes, John

      Knight, Greg (Derby North)

      Stradling Thomas, Sir John

      Knowles, Michael

      Sumberg, David

      Knox, David

      Summerson, Hugo

      Lang, Ian

      Taylor, Ian (Esher)

      Latham, Michael

      Taylor, John M (Solihull)

      Lee, John (Pendle)

      Taylor, Teddy (S'end E)

      Lennox-Boyd, Hon Mark

      Tebbit, Rt Hon Norman

      Lester, Jim (Broxtowe)

      Temple-Morris, Peter

      Lilley, Peter

      Thompson, Patrick (Norwich N)

      Lloyd, Sir Ian (Havant)

      Thornton, Malcolm

      Lloyd, Peter (Fareham)

      Thurnham, Peter

      Macfarlane, Sir Neil

      Townend, John (Bridlington)

      Maclean, David

      Tredinnick, David

      McLoughlin, Patrick

      Trippier, David

      McNair-Wilson, M. (Newbury)

      Trotter, Neville

      Madel, David

      Twinn, Dr Ian

      Malins, Humfrey

      Vaughan, Sir Gerard

      Mans, Keith

      Viggers, Peter

      Marshall, Michael (Arundel)

      Waddington, Rt Hon David

      Martin, David (Portsmouth S)

      Waldegrave, Hon William

      Mills, Iain

      Walden, George

      Miscampbell, Norman

      Walker, Bill (T'side North)

      Mitchell, Andrew (Gedling)

      Waller, Gary

      Montgomery, Sir Fergus

      Wardle, C. (Bexhill)

      Moore, Rt Hon John

      Watts, John

      Morrison, Hon Sir Charles

      Wells, Bowen

      Moss, Malcolm

      Wheeler, John

      Neale, Gerrard

      Whitney, Ray

      Neubert, Michael

      Widdecombe, Miss Ann

      Newton, Rt Hon Tony

      Wiggin, Jerry

      Nicholls, Patrick

      Wilshire, David

      Nicholson, David (Taunton)

      Winterton, Mrs Ann

      Nicholson, Miss E. (Devon W)

      Winterton, Nicholas

      Onslow, Rt Hon Cranley

      Wolfson, Mark

      Page, Richard

      Wood, Timothy

      Paice, James

      Woodcock, Mike

      Patnick, Irvine

      Patten, Chris (Bath)

      Tellers for the Noes:

      Patten, John (Oxford W)

      Mr. David Lightbown and

      Pawsey, James

      Mr. Kenneth Carlisle.

      Amendment accordingly negatived.

    Clause 29

      CROWN EMPLOYEES AND CONTRACTS ETC.
      Amendment made: No. 21, in page 32, line 1, leave out
      'and 10 above and any other enactment which'
      and insert
      3(3) and 10 above and any enactment which is contained in any other Act and'.—[Mr. Alan Howarth.]
      Order for Third Reading read.
      9.26 pm
      Mr. Fowler: I beg to move, That the Bill be now read the Third time.
      I shall be brief. This is an important Bill, which makes changes in both industrial relations law and in training arrangements for unemployed people. In November when I spoke on Second Reading, I said that the Bill was set against a background in which unemployment had fallen for 15 months in succession by more than 400,000 in the 12 months to that date. We have debated the Bill for 70 hours since Second Reading and three months later it is interesting to see that unemployment has fallen, not for 15 but for 18 months in succession, and not by 400,000 but by more than 500,000 in the past 12 months.
      The provisions give effect to three key proposals on employment and training which we set out in our manifesto. First, the manifesto outlined Our plans to consult on a major restructuring of our employment and training services. Secondly, it foreshadowed a change in the role of the MSC. Thirdly, it guaranteed a place on YTS to every school leaver under 18 not going directly into a job.
      Our plans for reforming the training available to longterm unemployed people underlie these proposals. It is now our major training priority to give the long-term unemployed the skills necessary to bring them back to work. I shall announce the details of this new programme shortly, but I can say that it will make it possible for us to retrain up to 600,000 a year and it represents a massive investment in training unemployed people in skills that they and our economy will need in future.
      The Bill also takes the process of industrial relations law reform a step further. The essence of this step-by-step process of change and reform is a determination to see that the framework of law is appropriate to match the needs of the day and to respond to any omissions that have been apparent. In that spirit, the Government published our Green Paper last February, which put forward issues and suggestions. During the general election, we made it entirely clear and gave full details of what issues we intended to legislate on. No one can claim that we have in any way hidden our intentions. The Bill basically puts into effect the promises we have made.
      The Bill is not— I repeat, not—an attack on trade unions or trade unionists. Many of its provisions simply build upon the examples which some unions have given us of how the rights of their members can be assured. It is concerned with the right framework of law for trade union affairs—the framework necessary above all to protect and ensure the rights which ordinary trade union members want and need. It puts the interests of trade union members first and foremost. That is the essence of our approach.

      441
      The Employment Act 1980 adjusted the balance of power between employers and trade unions. The Employment Act 1982 set out new responsibilities for unions and employees and the Trade Union Act 1984 promoted democratic practices in trade union affairs. The Bill is concerned with giving new rights to trade union members and setting out new ways by which those rights can be enforced.
      Trade union members must have protection from abuses of power by their unions and the rights in respect of their unions that they are entitled to expect in a free society. The Bill gives members the right not to be called out by their union without a properly held secret ballot which produces a majority; the right not to be disciplined by their union if they choose to work rather than to take industrial action; the right of access to their unions' accounting records and to have professional advice when inspecting them; and the right to stop their unions applying funds for unlawful purposes or handing out indemnities to those found guilty of criminal offences. It sets out other rights which will be available to all trade union members.
      Many trade unionists have some of those rights under their contracts of membership with their union, and to that extent the Bill merely confirms them, but there are examples of union rule books and practices which do not guarantee the fundamental rights. All the evidence is that trade union members and the public support the law guaranteeing those rights.
      The Bill has two strands. First, it develops further the training strategy of the Government, builds on the success of YTS and marks out our next priority, which is to provide better training for the long-term unemployed so that they can obtain skills to help them back to jobs. Secondly, on the industrial relations side, the Bill sets out a number of further reforms of the law which will ensure that excessive union power is held in check. But, above all, it gives new rights to trade union members. I commend the Bill to the House.
      9.32 pm
      Mr. Meacher: The Government are good, as we have learnt, at redefining problems they cannot solve so as to pretend they do not exist, and then they give them a new and wholly bogus name. To call the Bill an Employment Bill really does take the biscuit. It is not about employment, it is about keeping the anti-trade union vitriol on the boil. It is not even one Bill, it is two quite separate Bills, one about anti-trade union legislation and one about training programmes for the unemployed.
      It is a Bill that no one wants. The CBI, the Institute of Personnel Management, the Engineering Employers Federation and even the Freedom Association have expressed hostility to main parts of the Bill, none of which the Secretary of State has paid the slightest attention to. The hostility is scarcely surprising, for what responsible person in industry would ever call for a ballot when those who lost were encouraged to disobey the majority verdict, or for a Bill in which the Government took action to prevent a union from disciplining a minority who broke the majority decision? It is official, in clause 3 of the Bill.
      The Bill is the fourth in the Government's string of anti-trade union legislation. For a Government who like to claim respect for the law, the Bill totally undermines the deep respect held by the people for majority decisions democratically reached. Taken to its logical conclusion, it
      442
      will boomerang against the Government. If clause 3 discredits ballots to strike, it also discredits a ballot to return to work. It could lead to protracted disputes even after a negotiated settlement. Is that the kind of industrial relations that the Government believe in?
      What hypocrisy for the Prime Minister, having secured only 43 per cent. of the electorate's vote, to demand unswerving compliance with her laws while at the same time denying trade unions which secure more than 50 per cent. of their votes the power to carry through an overwhelming democratic decision without hindrance. Indeed, in recent weeks we have seen the Transport and General Workers Union receive 88 per cent. of the votes at Ford and the National Association of Colliery Overmen, Deputies and Shotfirers receive 90 per cent. of the pit vote.
      The Government are so psyched up by their third election victory that they have gone even further over the top in their vendetta against the unions. Not only are minorities protected if they opt out of majority decisions, but clause 16 requires ballots to be won overall and at each workplace with exceptions that will constitute a field day for lawyers. Clause 16 is designed to break up industrywide collective bargaining and undermine the whole idea of collective rights.
      We may conclude that the Bill is not simply anti-union; it is also profoundly anti-democratic. So it is. The Bill requires every ballot to be carried out by post rather than at the workplace even though the evidence shows overwhelmingly that workplace ballot produce much higher turnouts—in many cases twice as high. I would have thought that a much higher turnout at the workplace, plus the uncertain targeting by post, would have clinched the matter in favour of the former on democratic grounds.
      No doubt the Government believe that exposure to Sun editorials for the postal ballot is considerably more conducive to the right result than exposure to industrial activists at the workplace. It is such a pity that the Government's eagerness to constrain every minute detail of balloting for unions, even to the extent of forcing less democratic methods on them, does not extend to requiring any democratic procedures from employers, the City or the Tory party.
      However, amid all this bad news it is fair to state that there is something in the Bill that looks like a bit of silver lining. The Government are proposing to establish a commissioner for the rights of trade union members. That might appear surprising as not one union member has sought a declaration or enforcement order from the courts in the past four years. That is rather a small area of rights requiring attention when by comparison 30,000 complaints a year are made against the employer for unfair dismissal, of which one tenth are upheld by tribunals.
      That is precisely the problem for the Government, as the Green Paper admits. Trade union members are simply not using the courts. This new agent provocateur, this new commissar for the harassment of trade unions, is being wheeled out to make union members use the courts. That is the first example of nationalisation under this Government of a purely privatised undertaking, the destructive role of David Hart and other industrial malcontents that we saw during the strike by the National Union of Mineworkers. That, writ large, is what the new trade union harassment officer is all about.
      We might have thought that the commissioner would be ideally suited to stand up for the rights of trade union

      443
      members in the GCHQ affair, as that involved the Government as employer trying to remove the basic right to belong to a trade union. However, the commissioner is expressly precluded from taking up such cases. He can act only against trade unions. However, if the Government are genuinely solicitous about the rights of union members, why not extend the commissioner's power to help union members enforce their rights against the employer over health and safety, training, equal pay for work of equal value and redress against unfair dismissal? If the Government are so keen, as they have claimed to be, to "give the unions back to their members" why not let union members elect the commissioner so that they get the person they want?
      What confidence can union members have that the official appointed by the Government—not unknown for their partisan exercise of patronage in sensitive posts — will be impartial, or is the post being kept for industrial wallflowers like Ian MacGregor or as a bolthole for disgraced courtiers like the Secretary of State for Social Services?
      Part 2 deals with training programmes for the unemployed which, as we have already made clear, fail to meet the fundamental requirements which we have outlined. First, the Government's proposal to abolish wages based on the rate for the job and to restrict payment to benefit plus allowance is highly damaging. It will mean that two people doing the same job may get vastly different rates of payment.
      The change to benefit plus allowance would also rule out topping up by managing agents since any income over an additional £5 a week would be deducted pound for pound from the allowance. Paying the rate for the job is the only way to organise temporary employment or work experience for adults. It is essential to help prevent job substitution and undercutting of wages. This principle must remain the basic building block of any new programme. It is not in the Bill.
      Secondly, the scheme must be voluntary. I do not wish to call the credibility of the Secretary of State into question, but I find it difficult to believe him when he says that the new scheme will be voluntary. People should join the scheme because they want to, not because they fear that they will lose all or part of their benefit if they do not join. Compulsion is a recipe for lower standards, resentment and disruption. It could drive the unemployed into the shadow economy or into even greater poverty. Neither employers nor trade unions want reluctant conscripts in workplaces or special projects. Compulsion, together with the reduction to benefit plus allowance, would effectively convert the community programme into the worst kind of workfare, as we have seen in the United States. That is what we believe would happen.
      Thirdly, the only way to guarantee protection for participants is to ensure that they continue to have employee status, which will give them legal protection on anti-discrimination rights, health and safety, industrial injuries and other employment rights. The Government's proposals in the Bill will remove employee status from participants and deny them the right to legal protection.
      Fourthly, trade unions are an essential way of maintaining proper terms and conditions for participants, for ensuring health and safety standards, for preventing abuse of commission rules, for representing participants
      444
      and working to improve training schemes. The cooperation of trade unionists is essential to the success of such schemes. Therefore, trade union approval and monitoring, and endorsement by area manpower boards, should continue to be part of a properly financed scheme based on these four principles. None of the four principles is in the Bill.
      The Bill is not about improving industrial relations; it is about poisoning attitudes to trade unions. It is not about creating employment; it is about undermining collective rights. It is not about enhancing training; it is about removing people from unemployment registers and providing cheap labour for employers. It is not wanted by either side of industry. It is a Bill too far, even by the anti-trade union prejudices of the Government. It will be unremembered and unlamented when the next Labour Government consign it to the dustbin of history.
      9.43 pm
      Mr. Tim Janman: This excellent Bill has my wholehearted support. One of the most important and essential ingredients of the Bill is clause 3 which defends the right of an individual to follow his conscience on whether he joins an industrial dispute, and removes from him the fear of having to live under the threat of a jumped-up little Hitler of a shop steward who will bang him over the head if he dares go against the wishes of the union.
      Opposition Members have rightly pointed out that people have to consider what the reaction of their colleagues will be when a dispute is over and they return to work. They are absolutely right about that. It is useful to see Opposition Members at last recognising that one cannot legislate to change human nature. That is a factor which individuals have to weigh up when considering whether to join a dispute.
      However, it is wholly unacceptable when unions such as the National Association of Schoolmasters and Union of Women Teachers, can expel 500 teachers, as it recently did, because those individuals put the needs of their customers — in this case, their pupils — before other matters that their conscience said were less important. I know that my hon. Friend the Member for Pembroke (Mr. Bennett) had experience of that sort of travesty when he was expelled from the NAS-UWT in 1979.
      Unions are unique. There is no parallel between a trade union and an employer and there is certainly no parallel between a trade union and a golf club, as we heard suggested by Opposition Members in Committee. It is interesting to note the reaction of Opposition Members who are saying that there is a degree of state interference coming into trade unionism. They are always the first to stand up and defend state interference in the way in which an employer conducts his business. If we look at the amount of legislation and the regulations that employers have to put up with, we see that it is still far more than anything that is happening in this Bill with regard to trade unions.
      The way in which Opposition Members have ranted and raved about the Bill would lead one to think that we were giving the minority the right to veto the majority. Clearly, we are not. Clause 3 merely gives the individual the right to follow his conscience, and rightly so. It is a good clause and I support it, as I am sure do most of my hon. Friends.
      Other major elements of the Bill are the two clauses relating to the closed shop—clauses 10 and 11. Much

      445
      was made by Opposition Members of the Freedom Association's rather woolly thinking on clause 3 but they did not mention the essential caveat made by the Freedom Association, which was the ending of the closed shop.
      My hon. Friend the Member for Colne Valley (Mr. Riddick) and I said in Committee that we remain sceptical about the ability of clauses 10 and 11 to have any effect on the pre-entry closed shop. We welcome the commitment from the Minister in Committee that if clauses 10 and 11 do not have the desired effect, the Government will come back to legislate further to ensure that the closed shop — an odious concept, totally incompatible with a free society or free labour markets —is completely removed from our way of life.
      I should like to make two quick points on clauses 12 and 13. First, I hope that the Government will carry out the commitment made in Committee to introduce a clause in the Lords for election addresses to be made a requirement of postal ballot elections. I hope that the Government will consider bringing forward a code of conduct for the nomination procedure for people who are to be nominated for the posts of general secretary and president, which are non-voting posts on the executive.
      Clause 7 does not go anywhere near far enough. It is a travesty that millions of people in this country are being coerced into paying money to a political party that they neither support nor vote for. We have heard much from the hon. Member for Oldham, West (Mr. Meacher) about democracy in all sorts of organisations, including the Conservative party. However, I am sure that there is no organisation as foolish as the Labour party, which allows block votes which include millions of people who do not vote for the party or support it.
      I know that the Government will not do anything in this Bill, but I hope that one day we will bite the bullet of contract-in and contract-out and that we will legislate to say that if somebody wishes to pay the political levy, they have to volunteer to do so. At present millions of people are conscripts in the army of the Labour party.
      I support the Bill, as do the vast majority of my hon. Friends. It will enhance democracy, freedom and accountability of trade unions and their leadership.
      9.48 pm
      Mr. Harry Barnes: The hon. Member for Thurrock (Mr. Janman) is as tolerant of trade unions as he is of ethnic minorities. His views on this matter are listened to as little as his views on racial issues.
      The Government's approach to trade union measures is just like their approach to many other measures which they are pushing through the House. They have discovered that the step-by-step approach, in which one measure follows another in rapid succession, begins to have an effect if they take action, not by dealing with unemployment, but by encouraging developments whereby unions and others find themselves in a weak position to negotiate. We can learn some lessons from the Government's techniques in respect of trade unions and put them into practice when we come to office and reverse those measures to regain sanity in trade union matters.
      There is a double tactic in the Bill, as there is in the local government legislation. Theoretically, the Government are pushing for a free and open market and arguing about a correct balance of power between capital and labour. Anyone can see that the balance which the Government have been trying to correct—they see it as an imbalance
      446
      —has gone to such a ridiculous extreme that trade union organised labour is in such a poor position that it cannot defend the interests of its members. This is a further measure in that direction. Paradoxically, when the Government push such measures in the name of a sacred free market and of a balance of power, they do so by enhancing central control, as with local government legislation.
      The role of the MSC and the commissioner is presented by the Government as a sea change. There is the almost obligatory change of name from the Manpower Services Commission to the Training Commission. The Government appear to believe that, by changing its name, they can make people forget their original criticisms of an organisation. It is like using new language to describe Sellafield, but people learn about organisations from the way they operate and changes of name do not alter people's attitudes towards organisations.
      This change of name fits into a general pattern of a Tory version of newspeak. We all know about George Orwell and about Ingsoc. The Government have developed their own form of "ingcon" whereby words are changed to soften public images. For example, the poll tax is called a community charge and cuts are renamed efficiency savings. The measure has nothing to do with unemployment. People will be expected to forget their experiences of the MSC because it is to be called a Training Commission.
      Let us examine the record of the MSC since the Government came to power in 1979. Since then, the number of unemployed has doubled and the Government have put millions of pounds into the MSC and its various schemes. During that time, the MSC was transformed from a benign, consensual, bipartisan, independent body, which role was assigned to it by the right hon. Member for Bexley and Sidcup (Mr. Heath) and the last Labour Government, into the image of the market place.
      Education and training are now targeted at the employer as customer rather than at the individual. The Government are supposed to be concerned about the individual. As an employee and citizen, the individual is not considered in the Education Reform Bill or this measure. Under the Tories, the MSC's aim has been to deliver a cowed, cheap work force to the lowest bidder. Its aim has been to reduce the expectations and attitudes of a generation who have been denied real jobs and given poor training. As the Chancellor of the Exchequer, in one of his franker moments, said, training is not so much low-tech as no-tech. We should remember the comments of the chairman of the MSC in 1981:
      "the young should be the source of cheap labour."
      Yesterday, in a programme entitled "File on Four", the monetarist guru, Patrick Minford, frankly admitted that which politicians cannot admit; the new adult training scheme is about reducing wages. That is the Government's hidden agenda. We know that the NHS is not safe in their hands. We now know that rights, pay and conditions at work are equally unsafe. The Bill worsens an already bad situation and inevitably moves us towards more compulsory labour schemes and workfare.
      The Government cures unemployment for 16 to 18-year-olds by coercing them into cheap labour schemes or low-paid jobs. They introduced a new adult training scheme, on which claimants will work for benefit-plus. That is as near to workfare as the Tories can get at the moment. That it is getting closer to workfare was

      447
      demonstrated in Committee by the Tories' argument during the debate on clause 26. That clause expands the reasons for which unemployment benefit can be withdrawn. It used to be for six weeks. It is now to be increased from its current level of 13 weeks to 26 weeks. Under the Social Security Act 1975, unemployment benefit can be confiscated if a claimant
      "has without good cause refused or failed to avail himself of a reasonable opportunity of receiving training approved by the Secretary of State … for the purpose of becoming or keeping fit for entry into, or return to, regular employment."
      Those words have been withdrawn from this legislation.
      In this legislation, those 19 words will make a crucial difference. No longer will training have any relevance or purpose for the individual. An individual can be coerced into cheapjack training schemes or face the prospect of living even further below the poverty line than he does at present. The training measure demonstrates the depth of the legislation, and I urge hon. Members to vote against it.
      9.58 pm
      Mr. Spencer Batiste: On Second Reading, as vice-president of the Conservative Trade Unionists organisation, I wholeheartedly welcomed the legislation for the dramatic improvement that it will make in the lot of rank and file trade unionists. Time is short, so I shall not deal with all clauses, but simply say that the organisation again welcomes the Bill. It has already had its first notable success, even before it has become law, by forcing the National Union of Mineworkers to have an election for its presidency. I expect that, when the Bill becomes law, there will be many more notable successes in the years to come. I warmly commend it to the House and wish it well in its further passage.
      9.59 pm
      Mr. Strang: We are fundamentally opposed to the Bill, which is anti-trade union, centralist and authoritarian. It seeks to concentrate more power over training in the hands of the Secretary of State. The Government are suppressing organisations in our society that seek to dissent, which is why they have abolished the GLC and the metropolitan counties, and why they attack our trade unions.
      The Bill was brought out, and the decisions about it were taken, in the hope that the Conservative party could make political capital in the run-up to the general election. All the evidence shows that, day by day, more and more people are coming to recognise that, far from the legislation helping to solve industrial disputes, it will make it harder to do so. They are beginning to understand that the Bill will not enhance democracy in the workplace: it will diminish it. Above all, more and more people are beginning to recognise that it is in their interests that trade unionists should have more power in the workplace—
      It being Ten o'clock, the debate stood adjourned.

  BUSINESS OF THE HOUSE
  Ordered,
  That, at this day's sitting, the Employment Bill may be proceeded with, though opposed, until any hour. — [Mr. Alan Howarth.]

Employment Bill
Question again proposed, That the Bill be read the Third time.
Mr. Strang: We support a constructive role for trade unionists in our society; that is why we shall vote against the Bill tonight.
10 pm
Mr. Cope: I arranged with my right hon. Friend the Secretary of State to respond to any new points that were raised by the Opposition on Third Reading, but there were none, so I commend the Bill to the House.
Question put, That the Bill be now read the Third time:—
The House divided: Ayes 290, Noes 219.

Division No. 178]

[10.00 pm

AYES

Adley, Robert

Clarke, Rt Hon K. (Rushcliffe)

Aitken, Jonathan

Colvin, Michael

Alison, Rt Hon Michael

Conway, Derek

Allason, Rupert

Coombs, Anthony (Wyre F'rest)

Amess, David

Coombs, Simon (Swindon)

Amos, Alan

Cope, John

Arbuthnot, James

Cormack, Patrick

Arnold, Jacques (Gravesham)

Couchman, James

Arnold, Tom (Hazel Grove)

Cran, James

Aspinwall, Jack

Currie, Mrs Edwina

Atkins, Robert

Curry, David

Atkinson, David

Davies, Q. (Stamf'd &amp; Spald'g)

Baker, Rt Hon K. (Mole Valley)

Davis, David (Boothferry)

Baker, Nicholas (Dorset N)

Day, Stephen

Baldry, Tony

Dickens, Geoffrey

Batiste, Spencer

Dorrell, Stephen

Beaumont-Dark, Anthony

Douglas-Hamilton, Lord James

Bellingham, Henry

Dover, Den

Bendall, Vivian

Dunn, Bob

Bennett, Nicholas (Pembroke)

Durant, Tony

Benyon, W.

Dykes, Hugh

Bevan, David Gilroy

Emery, Sir Peter

Biffen, Rt Hon John

Evennett, David

Biggs-Davison, Sir John

Fairbairn, Nicholas

Blackburn, Dr John G.

Fallon, Michael

Blaker, Rt Hon Sir Peter

Farr, Sir John

Body, Sir Richard

Favell, Tony

Boscawen, Hon Robert

Fenner, Dame Peggy

Boswell, Tim

Field, Barry (Isle of Wight)

Bottomley, Mrs Virginia

Finsberg, Sir Geoffrey

Bowden, A (Brighton K'pto'n)

Forman, Nigel

Bowden, Gerald (Dulwich)

Forsyth, Michael (Stirling)

Bowis, John

Forth, Eric

Boyson, Rt Hon Dr Sir Rhodes

Fowler, Rt Hon Norman

Braine, Rt Hon Sir Bernard

Fox, Sir Marcus

Brandon-Bravo, Martin

Franks, Cecil

Brazier, Julian

French, Douglas

Bright, Graham

Fry, Peter

Brittan, Rt Hon Leon

Gale, Roger

Brooke, Rt Hon Peter

Gardiner, George

Bruce, Ian (Dorset South)

Gill, Christopher

Buck, Sir Antony

Gilmour, Rt Hon Sir Ian

Budgen, Nicholas

Glyn, Dr Alan

Burns, Simon

Goodlad, Alastair

Burt, Alistair

Goodson-Wickes, Dr Charles

Butcher, John

Gorman, Mrs Teresa

Butler, Chris

Gorst, John

Butterfill, John

Gow, Ian

Carlisle, Kenneth (Lincoln)

Gower, Sir Raymond

Carrington, Matthew

Grant, Sir Anthony (CambsSW)

Carttiss, Michael

Greenway, Harry (Ealing N)

Cash, William

Greenway, John (Rydale)

Chalker, Rt Hon Mrs Lynda

Gregory, Conal

Chapman, Sydney

Griffiths, Sir Eldon (Bury St E')

Chope, Christopher

Griffiths, Peter (Portsmouth N)

Clark, Hon Alan (Plym'th S'n)

Grist, Ian

Clark, Dr Michael (Rochford)

Ground, Patrick

Clark, Sir W. (Croydon S)

Grylls, Michael

449

Gummer, Rt Hon John Selwyn

Nicholson, David (Taunton)

Hamilton, Hon A. (Epsom)

Nicholson, Miss E. (Devon W)

Hanley, Jeremy

Onslow, Rt Hon Cranley

Hannam, John

Page, Richard

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

Paice, James

Hargreaves, Ken (Hyndburn)

Patnick, Irvine

Harris, David

Patten, Chris (Bath)

Hawkins, Christopher

Patten, John (Oxford W)

Hayhoe, Rt Hon Sir Barney

Pawsey, James

Hayward, Robert

Peacock, Mrs Elizabeth

Heathcoat-Amory, David

Porter, Barry (Wirral S)

Heddle, John

Porter, David (Waveney)

Hicks, Mrs Maureen (Wolv' NE)

Portillo, Michael

Hicks, Robert (Cornwall SE)

Powell, William (Corby)

Hill, James

Price, Sir David

Hind, Kenneth

Raffan, Keith

Hogg, Hon Douglas (Gr'th'm)

Raison, Rt Hon Timothy

Holt, Richard

Rathbone, Tim

Hordern, Sir Peter

Redwood, John

Howard, Michael

Rhodes James, Robert

Howarth, G. (Cannock & B'wd)

Rhys Williams, Sir Brandon

Howell, Rt Hon David (G'dford)

Riddick, Graham

Howell, Ralph (North Norfolk)

Ridsdale, Sir Julian

Hughes, Robert G. (Harrow W)

Rifkind, Rt Hon Malcolm

Hunt, David (Wirral W)

Roberts, Wyn (Conwy)

Hunt, John (Ravensbourne)

Roe, Mrs Marion

Hunter, Andrew

Rost, Peter

Irvine, Michael

Rowe, Andrew

Irving, Charles

Rumbold, Mrs Angela

Jack, Michael

Ryder, Richard

Janman, Timothy

Sainsbury, Hon Tim

Jessel, Toby

Sayeed, Jonathan

Jones, Gwilym (Cardiff N)

Shaw, David (Dover)

Jones, Robert B (Herts W)

Shaw, Sir Giles (Pudsey)

Kellett-Bowman, Dame Elaine

Shaw, Sir Michael (Scarb')

Key, Robert

Shelton, William (Streatham)

Kilfedder, James

Shephard, Mrs G. (Norfolk SW)

King, Roger (B'ham N'thfield)

Shepherd, Colin (Hereford)

King, Rt Hon Tom (Bridgwater)

Shepherd, Richard (Aldridge)

Kirkhope, Timothy

Shersby, Michael

Knapman, Roger

Sims, Roger

Knight, Greg (Derby North)

Skeet, Sir Trevor

Knight, Dame Jill (Edgbaston)

Smith, Sir Dudley (Warwick)

Knowles, Michael

Smith, Tim (Beaconsfield)

Knox, David

Speed, Keith

Lang, Ian

Speller, Tony

Latham, Michael

Squire, Robin

Lennox-Boyd, Hon Mark

Stanbrook, Ivor

Lester, Jim (Broxtowe)

Steen, Anthony

Lilley, Peter

Stern, Michael

Lloyd, Sir Ian (Havant)

Stevens, Lewis

Lloyd, Peter (Fareham)

Stewart, Allan (Eastwood)

Luce, Rt Hon Richard

Stewart, Andrew (Sherwood)

McCrindle, Robert

Stokes, John

Macfarlane, Sir Neil

Stradling Thomas, Sir John

Maclean, David

Sumberg, David

McLoughlin, Patrick

Summerson, Hugo

McNair-Wilson, M. (Newbury)

Tapsell, Sir Peter

Madel, David

Taylor, Ian (Esher)

Major, Rt Hon John

Taylor, John M (Solihull)

Malins, Humfrey

Taylor, Teddy (S'end E)

Mans, Keith

Tebbit, Rt Hon Norman

Maples, John

Temple-Morris, Peter

Marshall, Michael (Arundel)

Thompson, D. (Calder Valley)

Martin, David (Portsmouth S)

Thompson, Patrick (Norwich N)

Mills, Iain

Thornton, Malcolm

Miscampbell, Norman

Thurnham, Peter

Mitchell, Andrew (Gedling)

Townend, John (Bridlington)

Mitchell, David (Hants NW)

Tredinnick, David

Monro, Sir Hector

Trippier, David

Montgomery, Sir Fergus

Trotter, Neville

Moore, Rt Hon John

Twinn, Dr Ian

Morris, M (N'hampton S)

Vaughan, Sir Gerard

Morrison, Hon Sir Charles

Waddington, Rt Hon David

Morrison, Hon P (Chester)

Wakeham, Rt Hon John

Moss, Malcolm

Waldegrave, Hon William

Neale, Gerrard

Walden, George

Neubert, Michael

Walker, Bill (T'side North)

Newton, Rt Hon Tony

Waller, Gary

Nicholls, Patrick

Wardle, C. (Bexhill)

450

Warren, Kenneth

Winterton, Nicholas

Watts, John

Wolfson, Mark

Wells, Bowen

Wood, Timothy

Wheeler, John

Woodcock, Mike

Whitney, Ray

Young, Sir George (Acton)

Widdecombe, Miss Ann

Wiggin, Jerry

Tellers for the Ayes:

Wilshire, David

Mr. David Lightbown and

Winterton, Mrs Ann

Mr. Alan Howarth.

NOES

Abbott, Ms Diane

Flynn, Paul

Adams, Allen (Paisley N)

Foot, Rt Hon Michael

Anderson, Donald

Foster, Derek

Archer, Rt Hon Peter

Foulkes, George

Armstrong, Ms Hilary

Fraser, John

Ashdown, Paddy

Fyfe, Mrs Maria

Ashley, Rt Hon Jack

Galbraith, Samuel

Ashton, Joe

Galloway, George

Banks, Tony (Newham NW)

Garrett, John (Norwich South)

Barnes, Harry (Derbyshire NE)

Garrett, Ted (Wallsend)

Barron, Kevin

Godman, Dr Norman A.

Battle, John

Gordon, Ms Mildred

Beckett, Margaret

Graham, Thomas

Beith, A. J.

Grant, Bernie (Tottenham)

Bell, Stuart

Griffiths, Nigel (Edinburgh S)

Benn, Rt Hon Tony

Griffiths, Win (Bridgend)

Bennett, A. F. (D'nfn & Ffdish)

Grocott, Bruce

Bermingham, Gerald

Hardy, Peter

Blair, Tony

Harman, Ms Harriet

Blunkett, David

Haynes, Frank

Boateng, Paul

Healey, Rt Hon Denis

Boyes, Roland

Heffer, Eric S.

Bradley, Keith

Henderson, Douglas

Bray, Dr Jeremy

Hinchliffe, David

Brown, Gordon (D'mline E)

Hogg, N. (C'nauld & Kilsyth)

Brown, Nicholas (Newcastle E)

Holland, Stuart

Brown, Ron (Edinburgh Leith)

Home Robertson, John

Bruce, Malcolm (Gordon)

Hood, James

Buchan, Norman

Howarth, George (Knowsley N)

Buckley, George

Howells, Geraint

Callaghan, Jim

Hughes, John (Coventry NE)

Campbell, Ron (Blyth Valley)

Hughes, Robert (Aberdeen N)

Campbell-Savours, D. N.

Hughes, Roy (Newport E)

Canavan, Dennis

Hughes, Sean (Knowsley S)

Carlile, Alex (Mont'g)

Hughes, Simon (Southwark)

Clark, Dr David (S Shields)

Illsley, Eric

Clarke, Tom (Monklands W)

Ingram, Adam

Clay, Bob

John, Brynmor

Clelland, David

Jones, Barry (Alyn & Deeside)

Clwyd, Mrs Ann

Jones, leuan (Ynys M6n)

Cohen, Harry

Jones, Martyn (Clwyd S W)

Coleman, Donald

Kennedy, Charles

Corbett, Robin

Lambie, David

Corbyn, Jeremy

Lamond, James

Cousins, Jim

Leighton, Ron

Cox, Tom

Lestor, Miss Joan (Eccles)

Crowther, Stan

Lewis, Terry

Cryer, Bob

Litherland, Robert

Cummings, J.

Livsey, Richard

Cunliffe, Lawrence

Lloyd, Tony (Stretford)

Cunningham, Dr John

Lofthouse, Geoffrey

Dalyell, Tarn

McAllion, John

Darling, Alistair

McAvoy, Tom

Davies, Rt Hon Denzil (Llanelli)

McCartney, Ian

Davies, Ron (Caerphilly)

McCrea, Rev William

Davis, Terry (B'ham Hodge H'i)

McCusker, Harold

Dewar, Donald

Macdonald, Calum

Dixon, Don

McFall, John

Dobson, Frank

McKay, Allen (Penistone)

Doran, Frank

McKelvey, William

Duffy, A. E. P.

McLeish, Henry

Dunnachie, James

McTaggart, Bob

Dunwoody, Hon Mrs Gwyneth

Madden, Max

Eastham, Ken

Mahon, Mrs Alice

Ewing, Harry (Falkirk E)

Marek, Dr John

Fearn, Ronald

Marshall, David (Shettleston)

Field, Frank (Birkenhead)

Marshall, Jim (Leicester S)

Fisher, Mark

Martin, Michael (Springburn)

Flannery, Martin

Martlew, Eric

451

Maxton, John

Pike, Peter

Meacher, Michael

Powell, Ray (Ogmore)

Meale, Alan

Prescott, John

Michael, Alun

Primarolo, Ms Dawn

Michie, Bill (Sheffield Heeley)

Quin, Ms Joyce

Millan, Rt Hon Bruce

Radice, Giles

Mitchell, Austin (G't Grimsby)

Rees, Rt Hon Merlyn

Moonie, Dr Lewis

Reid, John

Morgan, Rhodri

Richardson, Ms Jo

Morley, Elliott

Roberts, Allan (Bootle)

Morris, Rt Hon A (W'shawe)

Robertson, George

Morris, Rt Hon J (Aberavon)

Robinson, Geoffrey

Mowlam, Marjorie

Rogers, Allan

Mullin, Chris

Rooker, Jeff

Murphy, Paul

Ross, Ernie (Dundee W)

Nellist, Dave

Ross, William (Londonderry E)

Oakes, Rt Hon Gordon

Rowlands, Ted

O'Brien, William

Ruddock, Ms Joan

O'Neill, Martin

Salmond, Alex

Orme, Rt Hon Stanley

Sedgemore, Brian

Parry, Robert

Sheerman, Barry

Patchett, Terry

Sheldon, Rt Hon Robert

Pendry, Tom

Shore, Rt Hon Peter

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Short, Clare

Walley, Ms Joan

Skinner, Dennis

Wardell, Gareth (Gower)

Smith, Andrew (Oxford E)

Wareing, Robert N.

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

Welsh, Andrew (Angus E)

Smith, Rt Hon J. (Monk'ds E)

Welsh, Michael (Doncaster N)

Snape, Peter

Wigley, Dafydd

Soley, Clive

Williams, Rt Hon A. J.

Spearing, Nigel

Williams, Alan W. (Carm'then)

Steel, Rt Hon David

Wilson, Brian

Steinberg, Gerald

Winnick, David

Stott, Roger

Wise, Mrs Audrey

Strang, Gavin

Worthington, Anthony

Taylor, Mrs Ann (Dewsbury)

Wray, James

Taylor, Matthew (Truro)

Young, David (Bolton SE)

Thompson, Jack (Wansbeck)

Turner, Dennis

Tellers for the Noes:

Vaz, Keith

Mrs. Llin Golding and

Wall, Pat

Mr. Frank Cook.

Wallace, James

Question accordingly agreed to.
Bill read the Third time, and passed.

Inner London Education Authority
Mr. Deputy Speaker (Sir Paul Dean): A large number of hon. Members wish to take part in this short debate. I hope that speeches will be relatively brief.
10.15 pm
The Secretary of State for Education and Science (Mr. Kenneth Baker): I beg to move,
That the draft Precept Limitation (Prescribed Maximum) (Inner London Education Authority) Order 1988, which was laid before this House on 29th January, be approved.
I shall try to follow your injunction, Mr. Deputy Speaker, by being reasonably brief, because I understand that many hon. Members wish to contribute to the debate. I am sorry that my opposite number, the hon. Member for Blackburn (Mr. Straw), has been ill for the past few days. I hope that he can soon return to the House and to Committee upstairs.
Last Thursday, I announced the Government's intention to wind up the Inner London education authority and to secure the transfer of education responsibilities to local councils from 1 April 1990. Today's debate concerns the financing of the authority in the forthcoming year. This order limits the precept which may be made by ILEA for the financial year 1988–89.
The precept maximum set out in the draft order has been arrived at after careful consideration. It is the product of a six-month process during which I have taken full account of the representations put to me by the authority, both in writing and in person. In a moment I shall briefly summarise that process, but before I do so I think it may assist the House if I set the order before hon. Members in its wider context.
ILEA is the largest education authority in the country. Like other inner-city authorities, it caters for communities which face a wide range of social and economic problems. However, the Government's assessment of need to spend takes account of such factors as concentrations of ethnic minorities, one-parent families, poor housing conditions and low family income, yet ILEA's budgeted spending in 1987–88 is a massive 75 per cent. above its grant-related expenditure assessment.
A comparison of ILEA's unit costs with those of other city authorities highlights its inefficiency. According to the latest figures from the Chartered Institute of Public Finance and Accountancy, the outer London boroughs are spending on average £1,100 per primary pupil. So are Manchester, Newcastle and Liverpool. Birmingham is spending just £900 per pupil. ILEA is spending £1,700 per pupil. The outer London boroughs are spending £1,700 per secondary pupil. Liverpool, Newcastle and Manchester are spending between £1,750 and £1,950 per pupil. ILEA is spending £2,600 per pupil. No other authority has unit costs which approach those of ILEA.
ILEA secondary schools on average have five more support staff than schools in outer London boroughs. They have nine more than schools in metropolitan areas as a whole. ILEA spends four times as much per pupil on school meals as the outer London boroughs on average and more than three times as much as metropolitan districts. It employs twice as many administrators and inspectors per head of population than the outer London
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boroughs and more than three times as many as the metropolitan districts. This shows that ILEA is a massive bureaucracy.
ILEA has become a by-word for high spending. It is by no means a by-word for high performance. Survey research suggests that ILEA ranks 86th among LEAs—practically at the bottom — in terms of the straight percentage of school leavers achieving five or more 0- levels at grades A to C or CSE grade 1, but is at the top of the league for spending per pupil. How best to allow in the assessment of performance for socio-economic factors is acknowledged to be a thorny issue, but the point is that however one does it ILEA's performance is disappointing. In other words, London's ratepayers are not getting good value for money.
Mr. Andrew F. Bennett: The Secretary of State has made a number of extremely contentious points. Will he tell us about the exam results? What proportion of ILEA pupils spend all their time from the age of five up to the age at which they take the exams in ILEA schools? Is it not true that London has a large turnover of population and many of those children spend only part of their time in ILEA schools? It is extremely difficult to judge the performance of an authority on exam results when pupils move in and out of the area.
Mr. Baker: The hon. Gentleman is not right about that. He specifically mentioned pre-five schooling. ILEA has some very good nursery schooling of which it is proud. But however one looks at the results—whether one tries to put a gloss on them or doctor them—the plain fact is that the results from ILEA are very disappointing by any standard.
Mr. Jeremy Corbyn: Will the right hon. Gentleman give way?
Mr. Baker: If the hon. Gentleman will allow me, I shall continue, because I know that several hon. Members wish to speak.
Since taking powers to limit precepts for selected authorities in the Rates Act 1984, the Government have sought to protect the inner London ratepayer from the high rate levels which are a result of ILEA's overspending. But ILEA has made precious little attempt to get control of its cost base. It has eroded its reserves and resorted to measures that impose further burdens on ratepayers in the longer term rather than tackle the root causes of its overspending. The authority spent £55 million more than its expenditure level set by the Government in 1986–87. Its budget for the current year is £80 million more than the implied expenditure level for the year — that is more than 8 per cent. So in the last two years alone, overspend has reached some £135 million.
ILEA is automatically designated for precept limitation in 1988–89 under section 68 of the Local Government Act 1985, as it has been for the past two years. But even if designation had not been automatic, ILEA's continued high spending would have brought it well within the criteria for selective designation. —[Interruption.] If hon. Members who do not represent ILEA areas wish to speak on ILEA matters, we should welcome it. I am glad that —[Interruption.]
Mr. Deputy Speaker: Order. This is a short debate and there is too much comment from a sedentary position from both sides of the House.
Mr. Baker: It is a short debate. Most of the interruptions seem to be coming from the hon. Member for Workington (Mr. Campbell-Savours). As I was saying, against the background of overspending that I have outlined, the Government are clear that a firm approach is needed to limit the burden that ILEA is placing on London householders and businesses alike.
Members should note that I have been prepared to listen and respond to the representations that ILEA has made to me. I have been prepared to—[HON. MEMBERS: "You have not."] I say to hon. Members who say that I have not listened that I have listened. I have listened carefully to representations. I increased the expenditure level——
Mr. Bernie Grant: What about parents?
Mr. Baker: It is a pity that Opposition Members follow in this House the customs that they learnt in some of the town halls of London. I would say only that I have listened. I have increased the expenditure level by £15 million, from £955 million to £970 million. Since October——
Mr. Corbyn: Will the right hon. Gentleman give way?
Mr. Baker: If the hon. Gentleman will allow me, I think I should pursue my speech. [HON. MEMBERS: "Give way."]
Mr. Baker: I shall be delighted to give way —[Interruption.]
Mr. Deputy Speaker: Order. I realise that the House feels strongly about this matter. However, it is a short debate, and it will be very much better if we have short speeches without interruptions.
Mr. Corbyn: Will the right hon. Gentleman give way?
Mr. Baker: I shall be delighted to give way.
Mr. Corbyn: Will the Secretary of State tell the House how many parents of ILEA children he consulted before introducing this monstrous order and why he feels that he has the power to impose an undemocratic diktat on the children and parents of all inner London schools?
Mr. Baker: The diktat was enshrined in statute in 1985 in the Act that abolished the Greater London council, and the rate precept and expenditure level principles have operated for the past four years.
Mr. Bernie Grant: How many parents?
Mr. Baker: I can tell the hon. Gentleman, who keeps shouting from a sedentary position, that I have consulted ILEA representatives and the chairman of ILEA as I am obliged to do. I have listened to their representations and have met them on several occasions. They put their views to me and I listened most carefully. Having listened to those representations, I decided to increase the expenditure level by about £15 million.
In December, I announced a redetermined expenditure level of £970 million with a requirement that the additional £15 million should be used only in connection with the one-off costs to which ILEA had drawn my attention. It said that it would put forward proposals, and I acknowledged the point made by the authority that in order to secure substantial savings from reductions in staffing levels it would need to incur one-off redundancy costs. It asked, would I please help with them? I increased the expenditure level by £15 million because, being a reasonable person, I listened to reason and responded.
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At the same time I proposed a precept maximum of 80.56p to enable the authority to raise the £970 million. In so doing I assumed that the authority would end the current year with revenue balances of about £30 million. I made no allowances for the drawing down of balances to relieve the precept.
Mr. Frank Dobson rose——
Mr. Baker: Perhaps the hon. Gentleman would allow me to continue.
In January the authority rejected the proposed precept maximum. It sought to raise an additional £73·5 million. That is £100 million less than its original demand. It made the demand and said that unless I agreed to the higher figure education in London would be ruined. Next time round the authority's demand had been reduced by £100 million, and that in itself is interesting. Nevertheless, as a result of its reduced demand, it required a precept increase that was 6p higher than my proposal.
I again considered carefully all that the authority had to say, including arguments about upward pressures on spending and the difficulty of securing savings in the first year of a programme of reductions. I decided to add to the precept maximum that I had originally proposed to allow the authority to raise another £15 million, or £985 million in total. The revised precept maximum is 81·8p, and that is 2p or 2·5 per cent. higher than the current year's precept.
Mr. Dobson rose——
Mr. Baker: Perhaps the hon. Gentleman will allow me to continue.
Then I laid before the House a draft order which would, if approved, enable me to prescribe a precept maximum of 81·8p. I did so because I am concerned to have the final outcome fixed by 15 February, the date set out in the Rates Act 1984 to avoid the uncertainty associated with the use of interim procedures, and so that there is no cause for ILEA to delay in implementing the measures necessary to live within the precept income that the maximum would raise. I made it clear that I was prepared to withdraw the order if agreement on the precept could be reached. However, the authority has rejected my revised figure.
Mr. Simon Hughes rose——
Mr. Baker: Perhaps the hon. Gentleman will forgive me if I do not give way.
As a result of the moves that I have made, the precept maximum in the draft order will allow the authority to raise £30 million more than the original expenditure level and £42 million more than the current year's expenditure level. The authority has said that this precept maximum will damage the education service in inner London. I do not accept that. In absolute terms, the redetermined expenditure level is over 50 per cent. above ILEA's GREA for 1988–89. The authority should be more than able to provide an adequate education service within that sum.
I recognise that the scale of reductions implied by the precept maximum —involving a cash cut of £40 million compared with the authority's budget for 1987–88 —represents a tough challenge.
Mr. Dobson rose——
Mr. Baker: I shall give way in a moment.
The effect on the service will depend on how the authority responds to that challenge, on whether it acts

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quickly to implement a savings package and manages that package effectively. I am satisfied that the precept maximum is reasonable and achievable, given responsible action by the authority.
Mr. Dobson: In view of the Secretary of State's announcement of the intended abolition of ILEA, does he think that ILEA will incur any expenditure in the next financial year because of the break-up of the authority? If so, what allowance has he made?
Mr. Baker: I do not think that in the next financial year ILEA will incur any expense in its break-up. I shall invite ILEA and the different London boroughs, whether Conservative, Labour or Liberal-controlled, to come and speak to my Department. I have set up a unit to do that so that there can be a proper, controlled transfer of education responsibilities. Costs will be incurred in the second year and the year of transfer.
Mr. Simon Hughes: The Secretary of State said that he consulted colleagues and officers. Can he tell the House why his colleagues on ILEA did not endorse yesterday the precept rate that he brings to the House today?
Mr. Baker: I have spoken to virtually all groups, although not to the Liberal group. Conservatives came to make representations to me. [Interruption] They must make up their own minds. They made their view clear to me when I saw them that substantial savings could be made in ILEA without any reduction in the service in inner London. They all strongly supported my statement last week to abolish the ILEA within two years.
I have given thought to the effect of the precept on ratepayers in inner London. The maximum is 2–5 per cent. higher than the current year's precept, and it will add about 1 per cent. to the average rate bill. The authority's original estimate of its needs would have added 18 per cent. to the current precept and nearly 8 per cent. to rate bills. That would have meant £75 more in rates for the owner of a three-bedroomed, semi-detached house in Camden and £300 more for the average shop. Its subsequent proposal for the precept would have added nearly 9 per cent. to the precept and an extra 4 per cent. to rate bills. It would not be right to impose those increases on ratepayers who are already overburdened as a result of ILEA's past overspending.
For those reasons, the draft order has been laid before the House and I ask the House to approve it. It is now up to the hon. Member for Denton and Reddish (Mr. Bennett) to make the case for ILEA and increased spending. That case rests on the need for extravagance, the importance of waste and the virtue of incompetence. I leave it to him.
10.32 pm
Mr. Andrew F. Bennett: First, I apologise on behalf of my hon. Friend the Member for Blackburn (Mr. Straw) who is ill; he would have liked to be here to make this case.
Last Thursday the Secretary of State came to the House as the messenger from the knackers' men to announce the slaughter of ILEA. He has returned tonight to announce that not content with slaughter, he wants to torture it. Will he come next week to inflict some further punishment to please his masters in the Tory party who seem to have a paranoid hatred of ILEA? It would be worrying enough if it was a hatred of a democratically elected body, but it
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is worse, because it is an attack on the education of 280,000 London children. His proposals to abolish ILEA and to penalise it financially this year will have a devastating effect on the education of those children. When he claims, as he did in the general election, that the Conservative party is anxious to raise standards, he should think hard about how he will lower standards of education in ILEA over the next two years.
I shall be brief because many of my hon. Friends feel angry and wish to speak. Can the Government guarantee that all those ILEA schoolchildren will not suffer over the next two years as a result of these cuts? What did the Secretary of State's professional advisers tell him about the practicality of imposing the cuts, not over 12 months but over six months? We must always remember that a school's financial year starts part way through the year, and commitments cannot be varied until the following September. The Secretary of State is imposing the cuts on schools from September. The professional advice from Mr. Rigg, the director of finance, and Mr. Stubbs of [LEA is that it will be impossible to do it.
The least that the Secretary of State could have done would be to say that he had received professional advice which suggested that the cuts were possible. But he has insisted that his officials keep quiet, because they cannot come up with advice on how to impose the cuts in the time scale envisaged.
About 75 per cent. of ILEA's expenditure is on staffing, and it will be extremely difficult to impose such cuts without harming the curriculum for pupils in ILEA schools.
The Secretary of State claimed that ILEA was profligate. He criticised its school meals expenditure, but he should remember that almost 50 per cent. of ILEA pupils take free meals. That shows the deprivation in the ILEA area. The Secretary of State should be proud of the fact that the authority wants to ensure that children get enough to eat and can benefit from their education. He should remember that the free school meals service was introduced because children could not benefit from their education. It looks as though he wants to return to the days when children could not learn properly because they were not properly fed.
The Secretary of State mentioned the expenditure on secondary school places. But through the assisted places scheme he is happy to pay sums that are far in excess of the money that ILEA spends on places such as those at Westminster school. If it is good enough to spend money on the assisted places scheme, why is it not good enough to spend money on all secondary pupils in ILEA? Why should they be penalised so that the Government can confer a privilege on the small group of children who obtain assisted places?
Since 1981, ILEA's expenditure has increased by about 45 per cent. The expenditure of the outer boroughs has increased by about 40 per cent., so ILEA has not done well compared with them. But the shire counties' expenditure has increased by 46 per cent. Let us consider the model of someone who should have shown financial propriety—the Secretary of State and his Department. During the same period, the Department's expenditure increased by 51 per cent. If it is so bad that ILEA's expenditure has increased by 45 per cent., is it not appalling that the Department's has increased by 51 per cent.? No doubt the right hon. Gentleman can justify his expenditure. I suggest that ILEA can justify its expenditure.

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The Secretary of State has had clear warnings from his professional advisers that if the cuts are imposed standards will fall. The Minister of State who will reply to the debate must prove to the House that standards in ILEA will not fall. Instead of continually running down ILEA, the Secretary of State should have recognised that ILEA has good nursery education and that it was involved in curriculum innovation long before the Government thought that it was fashionable. The Hargreaves report and the Thomas report not only discuss curriculum innovation, but demonstrate that many ILEA schools have been doing that for many years.
The Secretary of State should recognise ILEA's record on access by mature students to higher education. The White Paper on higher education pays lip service to the importance of attracting back mature students, but the Government do little about it. ILEA has a record second to none in attracting back mature students from working-class and ethnic minority backgrounds, and the Secretary of State should have paid tribute to it. It has an extremely good record on special education. The right hon. Gentleman has given us no evidence that the cuts are practical.
My hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) said that the cuts were announced two weeks ago. Since then, the Government have completely reversed their policy on ILEA and decided to abolish it. It will be almost impossible to impose the cuts. Even if there was a smooth running organisation to carry out the cuts, there would be great difficulties and hardship. However, the Secretary of State will not have that smooth organisation. He has thrown the organisation into complete turmoil. As ILEA is broken up, almost all the middle ranking officers in the authority will be considering their futures. They will not be sure that they will get jobs with the new borough authorities and they will be tempted to move out of ILEA. There will be great uncertainty. The Secretary of State is imposing two problems on ILEA— the problem of the abolition of the authority and the massive cuts in the first period.
Why on earth did the Secretary of State not take the order back to the Department and say that the Government have created a completely new situation with the proposal to abolish ILEA and that they would have to revise the order? That would have been the only honest thing for the Government to do. However, he is ploughing on with his paranoid hatred of the authority.
We have still not discovered what the Conservatives have against ILEA except that, on the whole, ILEA has been a beacon for good education standards —[Interruption.] It is all very well Conservative Members laughing, but if they visited the schools, they would find high-quality education in the vast majority. Perhaps ILEA should have proceeded with some of its reorganisation of the secondary schools to take account of falling rolls, but on many occasions it was the Government who delayed those logical reorganisations. The Government interfered when ILEA tried to go ahead with proposals for tertiary education. If there is any blame for ILEA being slow to take account of falling rolls, the Secretary of State and his predecessors must share some of the blame.
I ask my hon. Friends to express their anger at the Government's behaviour towards ILEA and to vote against the order.
10.41 pm
Sir Brandon Rhys Williams: I think that Opposition Members who are very wound up about this order tonight and about the Government's decision to end the inner London education authority rather imagine that something very sudden has developed and that this is the result of a new initiative which is quite unfounded and rather too hasty.
I would like to remind the House of the debate and the questions and answers that took place as long ago as 1981 when the Secretary of State for Education and Science at that time — Mr. Mark Carlisle as he was — after an extremely careful review, decided that the Inner London education authority should be permitted to continue. It was a very difficult balance of argument at that time. But I would like to remind the House of one of the things that he said in his statement on 4 February 1981:
"It is up to ILEA to put its house in order. It must recognise that the right to precept entails the obligation to spend responsibly. If ILEA systematically abuses the rating system by unchecked extravagance, additional financial controls will be needed. The Government are now considering what further measures they would take to meet that situation."
There could not have been a more sincere or clear warning from my then right hon. and learned Friend. I think that in retrospect he was being too trusting and too optimistic as things have turned out.
I spoke in the questions after the statement and among the things that I said was:
"will he proceed at once to place an upper limit on ILEA's expenditure in the coming year and not merely to rest on threats that if it overspends the Government may reconsider their position at some future date?"—[Official Report, 4 February 1981; Vol. 998, c. 297–300.]
I cannot say that I received from my right hon. and learned Friend a very satisfactory reply. So a few weeks later I and a number of other hon. Friends representing areas within the Inner London education authority brought in a Bill—the Inner London Education Authority (Expenditure Control) Bill—on 13 April 1981. It was signed by my hon. Friend the Member for Eltham (Mr. Bottomley), my hon. and learned Friend the Member for Putney (Mr. Mellor), my hon. Friend the Member for Chelsea (Mr. Scott), my hon. Friend the Member for Streatham (Mr. Shelton), Martin Stevens, the former Member for Fulham, my hon. Friend the Member for Westminster, North (Mr. Wheeler) and myself. The Bill's long title said:
"The Bill provides that the expenditure limit of the Authority shall be calculated by reference to the average cost of education per child in the remainder of England and Wales plus an element for London weighting to be determined by the Secretary of State."
I want to take the opportunity of the debate to pay tribute to many of the people in ILEA who are extremely dedicated, high quality educationists who do their utmost for the children. But we must recognise that ILEA is an enormously expensive authority for the results that it is achieving. I believe that is because its whole structure was misconceived from the start. It was always too large and unmanageable, bound to become a heavily bureaucratic organisation and bound to be an oppressive weight on the ratepayers.
The hon. Member for Denton and Reddish (Mr. Bennett) asked what the Conservatives have got against ILEA. What we have against ILEA is the hundreds and hundreds of pounds per ratepayer that have to be paid

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because of the precept, when we believe that the results we are getting for our money are not sufficient to justify the expense. This is why there is such an outcry for reform.
There is another side to the question. It is not simply a question of providing lavish and wonderful education for London. We have to think of where the money is coming from. In the case of my borough it is coming often from people who can ill afford the rates that they have to pay and who are building up a bitter resentment against ILEA because they feel that their money is being taken from them and wasted. This is not a situation that my right hon. Friend can allow to continue.
I entirely support my right hon. Friend's move to place an upper limit on ILEA's expenditure. I do not think that ILEA will be handicapped if it has these millions to spend. I think that my right hon. Friend has got the balance right. On behalf of my ratepayers, I hope that the order will be well received and will be passed by a substantial majority.
10.46 pm
Mr. Brian Sedgemore: I have been telling the Secretary of State in Committee that he is a very special person. Indeed, he seems to me to come into that category which The Times was referring to in an editorial in 1967 when it said:
"High politics are unsuitable for the ordinary man. Great Prime Ministers Winston Churchill and William Pitt were sociable drinkers; Lloyd George and Palmerston could not be trusted with women; Chatham, perhaps the greatest of all, was actually mad."
Having heard the Secretary of State talk about the precept tonight, and having listened to his proposals on the abolition of ILEA, I confidently predict that the right hon. Member for Mole Valley (Mr. Baker) will be even madder than Chatham.
To describe the Secretary of State's attitude towards ILEA as vindictive would be to utter a pathetic euphemism and to fail to invest in the richness of the English language which would allow us to pour hatred, scorn, venom, ridicule, derision and loathing on his many absurdities.
The first part of the right hon. Gentleman's plan is to create financial and administrative chaos, and in the process to ignore the advice of the two people who have statutory responsibilities in this sphere, that of the director of finance, whose responsibility comes under section 73 of the Rates Act 1984, and that of Mr. William Stubbs, the education officer, whose responsibility comes under the Education Act 1944. I am slightly surprised that the Secretary of State is prepared to ignore the advice of Mr. Stubbs since he is about to give him a prestigious post as head of the funding council for the polytechnics. If he thinks that Mr. Stubbs is such a brilliant man, perhaps the Secretary of State can explain why, when Mr. Stubbs presents such an honest view of the ILEA budget, he utterly ignores that view.
The Secretary of State's problem is that he moves from false premises to false conclusions by a logic that is not merely faulty but positively mystifying. Therefore, I am led to believe that the argument is not about logic but that we are talking about a brute political batte. Unfortunately, the firepower is not evenly distributed. Indeed, it reminds me of the battle which took place between the Rawalpindi and the Scharnhorst in November 1939. I know about that battle because my father died aboard the Rawalpindi. The Rawalpindi was a little merchant ship with a bit of tinplate and peashooters which masqueraded as guns. The
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Scharnhorst was the pride of the German fleet, a massive battleship which blew this little boat out of the water. I liken the Secretary of State to the captain of the Scharnhorst and Neil Fletcher, the leader of the I LEA, to Ludovic Kennedy's father, who was the captain of the Rawalpindi.
The force that the Secretary of State has is the political force of an arrogant majority in the House. It is the votes in the Lobby, the right of all Secretaries of State not to answer awkward questions in the House; it is the ability, if necessary, to produce guillotines in the House to get their measures through. Poor Neil Fletcher has one thing only. The only thing he has on his side is the moral authority that ILEA exercises and which is backed up by parents, children and teachers. Unfortunately, in this world, moral authority does not carry one very far and I suspect that Neil Fletcher will end up like Ludovic Kennedy's father—dead.
I have seen the papers that ILEA has presented to the Secretary of State and, in my view, it has argued a powerful case. However, the Secretary of State's response illustrates the substantial disadvantages in according to the Secretary of State centralised powers over local matters and powers that he is exercising without responsibility. The power to fix the precept rests with the Secretary of State but the responsibility rests with the two chief officers in ILEA. Effectively, the Secretary of State is telling David Riggs and William Stubbs that he is going to usurp and arrogate to himself executive powers that ILEA's officers should hold.
I have spoken to the officers at ILEA and they said that they have been talking not to the Secretary of State but to civil servants at the Department of Education and Science. When those civil servants have been pressed by ILEA's officers to say where the extra cuts can come from, they said, "The Secretary of State has looked at this"—I use their words—"in the round." Of course, the phrase "in the round" is a euphemism for the fact that the Secretary of State does not know what the hell is going on in ILEA.
The Secretary of State seems to think that one can close down schools rather as one can close down a factory at British Leyland or a British Coal pit. I do not pretend that it is easy to close down a British Leyland factory or a British Coal pit. However, if one starts to close down schools, which is inherent in the proposed huge cutback, the Secretary of State has to ask himself about the processes involved in dealing with 1,000 schools and colleges. How is ILEA supposed to offer a core curriculum to 1,000 separate institutions and then start to close some of them down without extraordinary rearrangements? First, there has to be lengthy negotiation with the staff of those institutions; by statute, there have to be extraordinary negotiations with the Department of Education and Science, there has to be a reorganisation of the remaining schools, one has to rejig the pupil-teacher relationship and reorganise the core curriculum. The Secretary of State has ignored every practical problem. Therefore, ILEA wins the argument and tonight the Secretary of State wins the votes.
However, things will get worse. I shall end on this point because many people want to speak. Phase two of the awful mechanism that the Secretary of State is putting into effect comes next Wednesday when we shall witness one of the constitutional outrages of the post-war years. —[Interruption.] Perhaps the hon. Member for Flarrow, West (Mr. Hughes) can tell me when this last happened.

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We are to have a Second Reading debate next Wednesday and we do not have available any of the new clauses that will be debated. There will be a debate on new clauses that will be produced on a subsequent day, probably Friday week, and they cannot be amended. My question to the hon. Member for Harrow, West is, when did the House last have a Second Reading debate on a major political issue without having any clauses before it and when the Bill could not be amended? I am not the one who is caught praying in aid the House of Lords, but if the House of Lords wishes to consider a constitutional issue, it is that we shall not be able to debate the Bill next Wednesday, and we shall not be able to amend clauses. That is an outrage and something of which a basically liberal, decent Secretary of State should be thoroughly ashamed.
11 pm
Mr. John Bowis: The hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore) is a little confusing. One moment, he predicts that we shall have a Chatham on the Government Front Bench, and the next minute he tries to close pits. We have enjoyed and been edified by the hon. Gentleman's membership of our Standing Committee. We have grown used to his predictions for the future of hon. Members and, indeed, members of ILEA and so on. I am amazed that the hon. Gentleman, who had such a distinguished career at the Bar and in the Civil Service, and had wealth and influence, should while away his evening years on Opposition Benches. We welcome him and enjoy his contributions. [HON. MEMBERS: "Get on with it."] I should like to extend the courtesy to other Opposition Members.
It is said that the best form of defence is attack. I do not suggest that the Opposition's defence is attack. There is no question of the Government attacking inner London education. The Government and Parliament are defending ratepayers and, ultimately, the education of children and students in inner London. That is what the measure is about. The Labour party knows that it cannot defend the indefensible—ILEA's expensive bureaucracy—so it tries to attack the modest restriction on overspending by that education authority.
Mr. Nigel Spearing: The hon. Gentleman referred to the modest measure. Does he agree that it represents an 8 per cent. cut in ILEA's expenditure for next year? Will he address the logistical problem that the Secretary of State did not mention, which is that roughly five twelfths of the cut will apply to the school year that will finish in August? Therefore, the effective cut will be around 14 to 15 per cent. for the next school year. Does that not pose a threat to children and ratepayers, for whom he expressed concern?
Mr. Bowis: I entirely accept that there is a cut. It will come as a great relief to the ratepayers of inner London, who would otherwise have had to pick up the tab. I agree also with the hon. Gentleman's implied criticism of ILEA for, over the years, getting itself into this position, having had the support of my hon. Friend the Member for Kensington (Sir B. Rhys Williams). The only explanation for overspending that the Opposition have given is that there is a degree of deprivation in inner London. If there is deprivation, and if it justifies ILEA's double spending on education, why, why are ILEA's results so poor?
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I represent a constituency in division 10 of ILEA. That division covers the Wandsworth borough. By all the criteria of deprivation, Wandsworth is not as badly off as its neighbouring boroughs. One would expect the results in the boroughs to be better. There is less deprivation than is to be found in other boroughs, but unfortunately the results are worse than in many other areas. That does not add up, even in ILEA's terms.
Mr. Chris Smith: Will the hon. Gentleman apply precisely the same argument to the expenditure of the Metropolitan police? Even if we remove the national functions of the force from our consideration, it still costs twice as much per head of population as any other force in the country. Furthermore, it has a worse success record than other forces. "Why, why", to quote the hon. Gentleman, does that occur?
Mr. Bowis: A national force with diplomatic and other special responsibilities cannot be compared with other forces. The hon. Gentleman should not knock the Metropolitan police, because in the area which I represent its result are getting better year by year. Let us defend the police as well as the education service.
In inner London there is twice the spending on education that is to be found in the rest of the country. The number of young people in inner London leaving school with five 0-levels or more, or CSEs grade 1, has reached the dizzy height of 10 per cent. Only 10 per cent. reach that standard or level before they are sent out into the job market, and the national average is 20 per cent.
Let us take the other side of the coin. In inner London, 20 per cent. of school leavers have no qualifications, which is twice the national average. At the same time, twice the national funding goes into ILEA schools. It is unfortunate that the results of school leavers within the area are only half as good as the national average.
Money alone is not the criterion by which we should judge ILEA. The key factor is the way in which money is spent. Funds must be redirected with a view to maximising the help that is given to ILEA schoolchildren. That will be done only if we enable the boroughs to spend on behalf of the children in their own areas. Money must be targeted to where it can be used most effectively.
Mr. Andrew F. Bennett: In which and how many of the schools in the hon. Gentleman's constituency does he foresee staff being lost?
Mr. Bowis: We are discussing the results of ILEA, not its administration. In the division which I represent there is only one secondary school that achieves results that are above par for ILEA, and that is a voluntary-aided Catholic school.
Mr. Corbyn: Will the hon. Gentleman give way?
Mr. Bowis: I shall continue because I know that many hon. Members wish to contribute to the debate.
There are many ways in which money that is directed to ILEA is misspent or badly spent. If we are to get the right education in inner London, we must get the funding and the ethos right. I read stories in the press about schoolboys being encouraged to dress in girls' clothes as part of a scheme to eradicate sexism. I read that boys aged up to seven years dress in skirts and petticoats and carry handbags. It seems that they are taught embroidery and play with dolls while girls play with engineering sets and toy cars as part of ILEA's scheme to combat sexism and

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stereotyping. This is happening — [HON. MEMBERS: "What is wrong with it?"] Presumably money is being paid to people to go to the ILEA schools to tell the staff to follow this course. That is an example of the way in which moneys are being wasted and misdirected. I accept that that may have been done a year or two ago.
Mr. Corbyn: The hon. Gentleman obviously did not hear the question asked by my hon. Friend the Member for Denton and Reddish (Mr. Bennett). Will he now tell us which schools, and how many teachers in his constituency, he proposes to axe, so that they can know what he is voting for tonight?
Mr. Bowis: The hon. Gentleman did not listen to the answer I gave before. I spoke of raising standards by directing funds into the schools and away from bureaucracy. That does not necessarily mean teachers. It means getting rid of the bureaucratic nonsense that I have been talking about.
As another example, I shall quote from a letter I received this week from the department of environmental design at the North London polytechnic, in the school of architecture, Holloway road:
"I confirm that the above named student is at present engaged in the preparation of a major design project for the final year of the diploma in architecture (Hons.) course. Therefore any appropriate assistance you will be willing to render to this student will be very greatly appreciated by the school of architecture"—
and so on. The letter from the student reads:
"I am a student in my final year at the polytechnic of North London, studying for a postgraduate diploma in architecture. For my final comprehensive design, I have chosen to design a brothel. Although it is a hypothetical exercise the aim is to make our projects as realistic as possible in preparation for the real world after college. I therefore need to collect as much information as I can on my subject in order to form a thesis to support my scheme."
That is ILEA—[HON. MEMBERS: "Tell us another.]" No doubt there are many others.
Not only does ILEA vastly overspend in the wrong ways, its children and schools—[Interruption.]
Mr. Deputy Speaker: Order. The House wants to hear how this is going to develop.
Mr. Bowis: The answer is clear. In the long run—I hope it will not be too long—we must remove our children and students from ILEA's care. In the meantime, we must certainly pass this modest measure to ensure that costs to inner London are reduced, and to direct spending on education to the chalk face — to the children and students—because that is where it belongs.
11.8 pm
Mr. Simon Hughes: The hon. Member for Battersea (Mr. Bowis) complained about education to avoid stereotypes; he might have benefited from that himself.
We should not approach this subject by giving silly examples, such as those that the hon. Gentleman produced. Even if the letter he read out was serious, which is highly unlikely, the hon. Gentleman should have addressed the real issue. ILEA is an education authority in inner London, with the most deprived concentration of population in the country. It is the largest education authority in Europe, and everyone in it accepts that improvements can be made. No one is uncritical of it. But what will be the effect of this financial order?
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Although there is certainly room for improvement in ILEA, the Secretary of State cannot say that it is the worst authority in the country. Some Tory education authorities have academic standards below those of ILEA. The Secretary of State says ILEA costs a great deal. As the hon. Member for Islington, South and Finsbury (Mr. Smith) told him, the Metropolitan police, with the lowest clear-up rate in London, costs relatively more. Inner London's health services, with the longest waiting lists, cost more. They are run by political appointees of the Government, not of the Opposition. Personal social services in inner London cost much more than those of any other local authority.
The authority, with a budget of £1,000 million, is being asked to lop off about £100 million. With no argument to back up his case, the Secretary of State is saying that that can be easily accepted. Even the right hon. Gentleman's party colleagues yesterday, in the building across the river, did not vote for his proposal. They abstained when it came to it because the people at the chalk face, as the hon. Member for Battersea described them, Tories elected to run education in London, elected directly by the people of London—the parents and ratepayers—know that LEA cannot cope with that cut and properly survive.
The reality is that £120 million must be lost. Seventy per cent. of costs are staff and 14 per cent. are fixed. ILEA is already committed to sums for this school year. Many savings could not begin until next year. Cuts take time to work through. It is an impossible requirement. Last year the Secretary of State said that a 7 per cent. cut would be a tough target to meet, yet this year, on top of that, there is this further cut.
ILEA has not said that it will not talk or is not willing to make savings. It has said that it accepts that the Conservatives, with their 41 per cent., won a general election, even though in inner London they won hardly any seats. It has said that it accepts that it must reduce its budget. —[Interruption.] The Conservatives may have won one seat, but the majority of ILEA members are not Tories. As hon. Members well know, the vast majority belong to the Opposition. The electors of inner London, who voted specifically for this education authority, by an overwhelming majority gave that trust to members of a party other than the Secretary of State's.
The reality is that there will be cuts not just in administrators but in people at the chalk face. That is why the hon. Member for Battersea should begin facing up to where the cuts will fall. They will fall on the children of the families whom he represents. They will fall on the students who hope to continue their education after 16. They will fall on people who have trained to be teachers and will no longer to be able to be teachers in the part of Britain that most needs qualified and competent teachers. They will fall on people who at the moment benefit from what is recognised as one of the best special education local authorities, not just in Britain but in the western world. The cuts will fall on the mentally and physically handicapped, who will not be able to have the resources they need and on the nursery schools for single-parent families that will not be opened. The hon. Member for Battersea deceives himself if he thinks that the people of inner London do not value education more than that.
Worse than that is the fact that the Secretary of State proposes that education should go to the boroughs—the same boroughs that he, when he was Secretary of State for the Environment, regularly condemned. He will be

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handing on to them a rundown education service, starved of funds, with a lack of repair, staff and commitment. He knows what happened when the GLC was abolished. Long before it went, senior officers left. Long before it went, many people jumped ship for the sake of their careers. At the end, the GLC no longer had key officers.
As has been made clear, the rate has been set by the Government with no suggestion from the Secretary of State of where the cuts should be made. He has suggested no budget but has simply said that ILEA must accept this cut.
The esimates do not even agree with the estimates from officials of ILEA of what is required and committed. There has been no proper consultation, in spite of what the Secretary of State would say.
Matters are even worse in London — for three reasons. First, in London three quarters of the money comes from the business rate, none of it from the taxpayer. The ratepayers have paid for the lot.
The domestic rate in London for ILEA has gone up only 78p per week in the past seven years. That is not a massive increase charged to the ratepayers. That is not vast additional expenditure. I wonder whether the ratepayers in the constituency of my hon. Friend the Member for Greenwich (Mrs. Barnes) or in my constituency would consider that that was too much to pay for the education service in inner London.
In ILEA there has been a 45–1 per cent. increase in spending between 1981–82 and 1987–88. In the whole of England, including ILEA, spending has increased by 45·3 per cent. Spending in ILEA has increased less than the average for the whole country, in spite of the need and the deprivation and in spite of the fact that some primary schools in my constituency have 28 different mother tongues. Comparatively, ILEA spends less than other services.
ILEA has been funded by the ratepayers. The Secretary of State is determined not to listen to the facts. That is why he received no support in county hall yesterday. Perhaps the red sky on the south bank, sadly because of the fire at St. Thomas's hospital, symbolises Baker's delight at the demise of education in London.
The Secretary of State once was committed to education. Now he is committed to undermining it for the people who most need it. It is disgraceful. The order will be resisted even if we cannot win the vote.
11.16 pm
Mr. George Walden: I wish to do something that has been almost unprecedented in the Chamber recently and base my comments on some of the remarks made by Opposition Members. The hon. Member for Southwark and Bermondsey (Mr. Hughes) stressed that ILEA is a democratically elected authority. The hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore) considered that Mr. Neil Fletcher has a one-man moral majority—I believe that the hon. Gentleman said that he had moral force. The hon. Member for Denton and Reddish (Mr. Bennett) stressed that the funding of ILEA and its abolition were inseparable. The hon. Member for Holborn and St. Pancras (Mr. Dobson) asked whether there would be any extra expenditure by ILEA in the next year— —[Interruption.] I am trying to help hon. Members by summarising their cases.
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I shall draw together those points. We must remember that the Government, Conservative Members and Opposition Members share one fundamental problem about London — parental apathy. That is linked with what has been said by Opposition Members. The hon. Member for Hackney, South and Shoreditch spoke about the moral force of Mr. Neil Fletcher. I remind the hon. Gentleman that the turnout in those direct elections was 44–04 per cent. of the population. In the hon. Gentleman's own constituency the turnout was 33.89 per cent. What sort of representation, moral force and democracy can be based on a turnout which, in my opinion, is not even a quorum of the electorate? What does that mean? It means that coupled with the degeneration of the Labour party —some obvious examples of that are present—ILEA is run by a doubly unrepresentative clique of people. That is not the fault of the Labour party—
Mr. Dobson: Will the hon. Gentleman give way?
Mr. Walden: No, I shall finish my point. It is the fault of parental apathy. Over the next few years, ILEA, because it is an unscrupulous organisation, will need extra money to spend on campaigning to perpetuate itself in the face of the Government's decision to abolish it. The Government must use every legitimate means at their disposal to communicate directly with parents in inner London and explain to them not the points that will be better explained by The Sun and other newspapers, or spending details, but the facts about education standards.
My right hon. Friend the Secretary of State should let parents know about the relative underachievement of ILEA compared with the rest of the country. He should also let them know how disgruntled London employers are about school leavers who are not fit to hold down jobs. He should also let London parents know, in simple, understandable language, that comparisons can be made between the underachievement of ILEA, after account has been taken of all the social problems with which it has to deal, and comparable European countries that provide a better education service.
Unless the Government show imagination during the wind-up period, the people of London will not agree with the Government's decision. They have been conditioned to accept low education standards. Unless the Government do their best to win the propaganda war, they will have a difficult political dispute on their hands. The Opposition will do their best to draw attention away from the central point of low education standards. That has already happened. Mr. Neil Fletcher is no longer speaking as he did two months ago. He no longer talks about the inadequacies of ILEA schools; he talks about how wonderful they are. I advise my right hon. Friend the Secretary of State for Education and Science to recognise that that will be the key to the winding up of ILEA.
Mr. Paddy Ashdown: The hon. Gentleman lectured us a few moments ago about the need to put the Government's case to London parents. There is to be a survey of the opinion of those parents. If their opinion is massively in favour of the retention of ILEA, would the hon. Gentleman recommend the Government to scrap this measure, or would he advise them to override the opinion of London parents?
Mr. Walden: I have already answered the hon. Gentleman's question. I made it clear that the

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Government will have a political problem on their hands in trying to convince some London parents. There is educational apathy in London, which is reflected in the figures that I have given. I could give more. This is not necessarily a party political point. An analysis of the turnout in the different boroughs shows that the opinion of London parents is not related directly to prosperity. It is a social problem that is caused by educational apathy. If the hon. Gentleman will listen for a moment, he will be completely convinced by what I have to say.
I am suggesting that the Government ought to try to overcome that apathy. There are people who live in this capital city who are culturally accustomed to low expectations and whose attitude has been hardened by ILEA's policies. I thought that the hon. Gentleman would have understood, from what I said earlier, that that was my point.
11.24 pm
Mr. John Fraser: I suppose that I should declare an interest, in that I went to a London county council school, my children went to an ILEA comprehensive school, my wife works for an ILEA school and I have been the governor of several ILEA schools. I wish that Conservative Members, especially Ministers, would declare their interests in these matters. If they were to declare the kind of schools which they attended and to which most want to send their children, we would understand the gulf between the thinking of the people who impose this order on ILEA and that of those who have to suffer its effects.
The hon. Member for Battersea (Mr. Bowis) was asked about the design of a brothel. I do not know why the letter was written in those terms, but if such a letter were addressed to the Secretary of State, it would invite his opinion on the design of a slaughterhouse. He should hang his head in shame. He comes to the House with a view to decimating ILEA, which is what he is doing in the order by taking away one tenth of its resources, and next week he will propose to the House ILEA's destruction.
The Secretary of State came to the House with no enthusiasm for ways in which ILEA could be reorganised to accept the 10 per cent. cut, but with a vicious enthusiasm for the cut without any constructive suggestions on the way in which it should be imposed. There will be a cut across the board. We have heard how difficult it is to impose a 10 per cent. cut in expenditure in the middle of the school year. It will mean a cut of 4,400 in the number of teachers. It will mean the closing of 100 schools and the cutting of 4,800 support staff or, put another way, the abolition of every second nursery school place in inner London. That is the nature of what the Secretary of State asks us to approve.
The Secretary of State is not asking ILEA to slim down. He is asking it to amputate a limb, because he is asking for cuts that are so sudden and deep in their surgery that they are bound to cause irreparable harm to ILEA through shedding staff, depleting the number of teachers and causing redundancies. The only thing in which the right hon. Gentleman took pride was the £15 million allocated not for employing staff but for sacking them.
The order represents an act of class warfare. It is an act of class warfare in the punning sense of the word, in that it attacks the child in the class. It is also an attack by the privileged, the affluent and those who, on the whole, have no experience in ILEA against those who have to struggle
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against the drudgery of poor, unskilled jobs and the even worse drudgery of unemployment. The Secretary of State is asking my constituency in the borough of Lambeth not only for cuts in ILEA but for cuts by the local authority.
What have the Government done to us? They have given us 25 per cent. male unemployment—I use the expression "male unemployment" because it is an effective measure of unemployment across the board—and taken away tax revenue by increasing rates, VAT and insurance contributions. The Government have taken away our jobs, homes and housing benefits. Act after Act of this Government has increased the deprivation and despondency in and instability of the inner city area that I represent.
Many children in the outer London boroughs who are leaving school face a 4 or 5 per cent. possibility of unemployment. In inner city areas such as mine, because of the background and tradition of housing, deprivation and poverty, the risk of unemployment for youngsters is probably sometimes as high as 50 per cent. There is only one way to climb the ladder and escape from the cage of the inner city—usually through the chance of education. Conservative Members, from the Secretary of State downwards, try to convince us that the way to improve the chances for those children to escape is to cut resources, not increase them.
Mr. Gerald Bowden: Will the hon. Gentleman give way?
Mr. Fraser: No, I am not giving way. This is a bitter attack——
Mr. Bowden: Will the hon. Gentleman give way?
Mr. Fraser: If the hon. Gentleman can defend Dulwich, I shall defend Brixton. This is a bitter attack by the privileged on the deprived, which we shall vole clown tonight.
Mr. Bowden rose——
Mr. Deputy Speaker: Order. It seems clear that the hon. Gentleman is not giving way.
Mr. Bowden: I am grateful to the hon. Gentleman for giving way.
Mr. Deputy Speaker: Order. Is the hon. Member for Norwood (Mr. Fraser) giving way?
Mr. Fraser: I have finished, Mr. Deputy Speaker.
Mr. Deputy Speaker: The hon. Gentleman has finished. Mr. Gerald Bowden.
11.31 pm
Mr. Gerald Bowden: Opposition Members should recognise that for the past 10 years the Conservative group on ILEA has presented an alternative budget, costed by the finance staff of ILEA, which showed a rational reduction in expenditure. If that had been accepted, ILEA would not now have to face these rather harmful cuts. The suggestions would have reduced the support staff and the extravagant and cost-inefficient services that back up ILEA—but not to the benefit of children — and would not have reduced the efficient delivery of an education service. Whenever a Socialist authority is faced with the need to make a cut it looks at the broom and cuts the bristles—the working edge—when it could take two inches off the handle.
11.32 pm
Ms. Mildred Gordon: The Inner London education authority has been accused of being a high-spending authority. As hon. Members have already pointed out, London is a special case. The Metropolitan police spends double the amount that other police authorities spend to less effect. The social services too spend more. But I want to ask Conservative Members how much per child they pay for their children's education in private schools. The most grubby little private school with unqualified teachers is charging £2,000 per head, and public schools charge double that. The other day I telephoned a tutorial college to which people from all over the country—and, indeed, from other countries—send their children for intensive coaching if they fail their 0 and A-levels. That costs £8,000 to £10,000 a year. Therefore, I reckon that we are getting very good value from ILEA.
ILEA has been attacked over its examination results. A recent survey by Sheffield university showed that ILEA's examination results are on a par with those of many other authorities. And examinations are only one side of the picture. We get a high-quality comprehensive service from ILEA. Adult education and education for special needs are used and much appreciated by adults and children living within a wide radius of London. I get letters from constituents who have never had the chance of further education who want to know what is to happen to Morley college. I would like the Minister to answer that, because people are very worried about that centre of excellence.
Mr. Walden: Will the hon. Lady give way?
Ms. Gordon: The hon. Gentleman has had his say.
Mr. Walden: Will the hon. Lady give way? [HON. MEMBERS: "Sit down."]
Mr. Deputy Speaker: Order. The hon. Member for Buckingham (Mr. Walden) has made his speech. It is clear that the hon. Lady does not intend to give way and time is now getting very short.
Ms. Gordon: The research and development carried out by ILEA has been used all over the country. Its initiatives include the Hargreaves report on secondary education, the Thomas report on primary education and the Fish report on special needs. Those reports were all valuable additions to educational knowledge and are useful to educationists throughout the country.
When we talk about standards of education we cannot ignore social conditions. The ILEA serves seven out of the 10 most deprived areas in Britain. I was a teacher and I know about children who live in overcrowded conditions and who sleep, sometimes six to a room, head to feet on the floor. They do not get a decent night's sleep and however well money is spent, however good the teachers and the standard of education, it is hard for children to learn when they are tired. Many children have no quiet place in which to do their homework. That is another disadvantage that the Secretary of State is not taking into account.
Many children have no books at home and do not get a head start. —[Interruption.] Conservative Members should listen to this because it is important. Children often come to school in the morning without food having been put in their mouths. Government policies mean that for many families the money runs out halfway through the
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week. Thousands of teachers in London and in other parts of the country keep a packet of biscuits in the cupboard. When the children come to school in the morning the teachers give them milk and a couple of biscuits because they know that the children are hungry.
ILEA should be given more than the amount of money needed to keep up with inflation. The money should not be cut. More should be provided and school breakfasts should be given to children who need them. That is what we should have in a civilised society. The Government will please their friends in the City of Westminster by keeping down rates at the expense of London's underprivileged children. They are using the same shameful tactics on ILEA as they are using on the Health Service. They are using the tactic of starving an organisation of resources in order to reduce services with which the public have been more than satisfied. If they reduce those services to a standstill, it will pave the way for the destruction of the Health Service and the abolition of ILEA.
11.38 pm
The Minister of State, Department of Education and Science (Mrs. Angela Rumbold): Year after year the Inner London education authority has claimed that the sky will fall as a result of precept limitation. I should like to quote from an ILEA committee paper that gives advice from ILEA's finance director and its education director about the prospects for balancing the budget given the precept maximum that my right hon. Friend was about to set. It says:
"Although on paper such a budget might balance, in practice it would rely on such a combination of financially favourable factors as to be incapable of achievement."
That paper is dated 9 January 1987. The budget in 1987–88 was balanced. The issue of overspending was barely tackled by ILEA. Its spending is outstandingly high relative both to the grant-related expenditure and in comparison to any other authority.
However, in determining the expenditure level and the precept maximum my right hon. Friend took into account all the factors relevant to the authority's circumstances. He listened to oral and written representations by ILEA on both matters and on each occasion made a positive response. Opposition Members have accused him of being vindictive, but that is not the action of a vindictive man.
The hon. Member for Southwark and Bermondsey (Mr. Hughes) took issue with my hon. Friend the Member for Battersea (Mr. Bowis) because my hon. Friend quoted from a letter which he had received from a young lady studying at the North London polytechnic and designing a brothel. Today I went to the polytechnic to make a speech to the students and this young woman showed me her design for a brothel. My only sadness was that I was not competent to advise her on whether it was a good or bad design.
Mr. Andrew F. Bennett: Will the Minister give way? Mrs. Rumbold: ILEA's assessment of the reduction in spending required in 1988–89—
Mr. Bennett: Will the Minister give way?
Mrs. Rumbold: —has come down from——
Mr. Bennett: Give way.
Mrs. Rumbold: No, I will not.
Mr. Bennett rose——
Mr. Deputy Speaker: Order. Mrs. Rumbold.
Mrs. Rumbold: ILEA—
Mr. Bennett: Will the Minister give way?
Mr. Deputy Speaker: Order. The House expects the Front Benches to set a good example. Mrs. Rumbold.
Mrs. Rumbold rose——
Mr. Bennett rose——
Mr. Clive Soley: On a point of order—
Mrs. Rumbold: I have an important point to make and I want to make it.
Mr. Bennett rose—
Mr. Soley: On a point of order, Mr. Deputy Speaker. On several occasions recently members of the Government have made allegations which have turned out to be untrue. Is it in order for the Minister to make an allegation which is probably untrue and then not to give way to have it tested in the normal way of this House?
Mr. Deputy Speaker: Order. That is a matter for argument, not a point of order for the Chair. I call Mrs. Rumbold.
Mrs. Rumbold rose——
Mr. Bennettrose——
Mr. Deputy Speaker: Order. This is an important debate. There are strong feelings about the matter and we have only a few minutes left. I hope that hon. Members will give the Minister an opportunity to answer the debate properly.
Mr. Bennett: On a point of order, Mr. Speaker. The Minister of State has made a serious accusation against ILEA. She should answer this simple question: was that course financed by ILEA or was it financed by the Government?
Mr. Deputy Speaker: It is for the Minister to say what she wishes, and she has only two minutes in which to do it.
Mrs. Rumbold: Opposition Members should listen to the Government's arguments and the reasons why they set such a precept for the Inner London education authority. There is a justification for it. The authority's assessment of required spending has come down from 15 per cent. to about 11·4 per cent. as the process continued, partly as a response to my right hon. Friend's representations. The reduction for which we are asking need not be as steep as ILEA claims, but much will depend upon the way in which the authority controls its upward pressures on spending.
My right hon. Friend the Secretary of State took full account of the authority's estimate of its base line for spending in 1988–89 in reaching his decision on expenditure and on the precept maximum. Its estimates were among the matters in front of him when he increased the proposed precept to allow ILEA to raise an additional £15 million—
It being one and a half hours after the commencement of proceedings on the motion, MR. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 14 (Exempted Business).
The House divided: Ayes 285, Noes 153.

Division No. 179]

[11.45 pm

AYES

Aitken, Jonathan

Fowler, Rt Hon Norman

Alison, Rt Hon Michael

Fox, Sir Marcus

Allason, Rupert

Franks, Cecil

Amess, David

Freeman, Roger

Amos, Alan

French, Douglas

Arbuthnot, James

Gale, Roger

Arnold, Jacques (Gravesham)

Gardiner, George

Arnold, Tom (Hazel Grove)

Garel-Jones, Tristan

Atkins, Robert

Gill, Christopher

Atkinson, David

Gilmour, Rt Hon Sir Ian

Baker, Rt Hon K. (Mole Valley)

Glyn, Dr Alan

Baker, Nicholas (Dorset N)

Goodlad, Alastair

Baldry, Tony

Goodson-Wickes, Dr Charles

Batiste, Spencer

Gorman, Mrs Teresa

Bellingham, Henry

Gorst, John

Bennett, Nicholas (Pembroke)

Gow, Ian

Bevan, David Gilroy

Gower, Sir Raymond

Blackburn, Dr John G.

Green way, Harry (Ealing N)

Body, Sir Richard

Greenway, John (Rydale)

Bonsor, Sir Nicholas

Gregory, Conal

Boswell, Tim

Griffiths, Sir Eldon (Bury St E')

Bottomley, Mrs Virginia

Griffiths, Peter (Portsmouth N)

Bowden, A (Brighton K'pto'n)

Grist, Ian

Bowden, Gerald (Dulwich)

Ground, Patrick

Bowis, John

Grylls, Michael

Boyson, Rt Hon Dr Sir Rhodes

Gummer, Rt Hon John Selwyn

Brandon-Bravo, Martin

Hamilton, Hon A. (Epsom)

Brazier, Julian

Hampson, Dr Keith

Bright, Graham

Hanley, Jeremy

Brooke, Rt Hon Peter

Hannam, John

Bruce, Ian (Dorset South)

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

Buchanan-Smith, Rt Hon Alick

Hargreaves, Ken (Hyndburn)

Buck, Sir Antony

Harris, David

Budgen, Nicholas

Hawkins, Christopher

Burns, Simon

Hayes, Jerry

Burt, Alistair

Hayhoe, Rt Hon Sir Barney

Butcher, John

Hayward, Robert

Butler, Chris

Heathcoat-Amory, David

Butterfill, John

Heddle, John

Carlisle, Kenneth (Lincoln)

Hicks, Mrs Maureen (Wolv' NE)

Carrington, Matthew

Hicks, Robert (Cornwall SE)

Carttiss, Michael

Hill, James

Cash, William

Hind, Kenneth

Chalker, Rt Hon Mrs Lynda

Hogg, Hon Douglas (Gr'th'm)

Channon, Rt Hon Paul

Hordern, Sir Peter

Chapman, Sydney

Howard, Michael

Chope, Christopher

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

Clark, Hon Alan (Plym'th S'n)

Howarth, G. (Cannock & B'wd)

Clark, Dr Michael (Rochford)

Howell, Ralph (North Norfolk)

Clarke, Rt Hon K. (Rushcliffe)

Hughes, Robert G. (Harrow W)

Colvin, Michael

Hunt, David (Wirral W)

Conway, Derek

Hunt, John (Ravensbourne)

Coombs, Anthony (Wyre F'rest)

Hunter, Andrew

Coombs, Simon (Swindon)

Hurd, Rt Hon Douglas

Cope, John

Irvine, Michael

Couchman, James

Jack, Michael

Cran, James

Janman, Timothy

Currie, Mrs Edwina

Jessel, Toby

Curry, David

Jones, Gwilym (Cardiff N)

Davies, Q. (Stamf'd & Spald'g)

Jones, Robert B (Herts W)

Davis, David (Boothferry)

Kellett-Bowman, Dame Elaine

Day, Stephen

Key, Robert

Dorrell, Stephen

King, Roger (B'ham N'thfield)

Douglas-Hamilton, Lord James

King, Rt Hon Tom (Bridgwater)

Dover, Den

Kirkhope, Timothy

Dunn, Bob

Knapman, Roger

Durant, Tony

Knight, Dame Jill (Edgbaston)

Emery, Sir Peter

Knowles, Michael

Evennett, David

Knox, David

Fairbairn, Nicholas

Lamont, Rt Hon Norman

Fallon, Michael

Lang, Ian

Farr, Sir John

Latham, Michael

Favell, Tony

Lawrence, Ivan

Fenner, Dame Peggy

Lee, John (Pendle)

Field, Barry (Isle of Wight)

Leigh, Edward (Gainsbor'gh)

Forman, Nigel

Lester, Jim (Broxtowe)

Forsyth, Michael (Stirling)

Lightbown, David

Forth, Eric

Lilley, Peter

475

Lloyd, Sir Ian (Havant)

Shelton, William (Streatham)

Lord, Michael

Shephard, Mrs G. (Norfolk SW)

Luce, Rt Hon Richard

Shepherd, Colin (Hereford)

McCrindle, Robert

Shersby, Michael

Macfarlane, Sir Neil

Smith, Sir Dudley (Warwick)

MacKay, Andrew (E Berkshire)

Smith, Tim (Beaconsfield)

Maclean, David

Soames, Hon Nicholas

McLoughlin, Patrick

Speed, Keith

McNair-Wilson, M. (Newbury)

Speller, Tony

McNair-Wilson, P. (New Forest)

Spicer, Sir Jim (Dorset W)

Major, Rt Hon John

Squire, Robin

Malins, Humfrey

Stanbrook, Ivor

Mans, Keith

Steen, Anthony

Maples, John

Stern, Michael

Marshall, Michael (Arundel)

Stevens, Lewis

Martin, David (Portsmouth S)

Stewart, Allan (Eastwood)

Maude, Hon Francis

Stewart, Andrew (Sherwood)

Mawhinney, Dr Brian

Stewart, Ian (Hertfordshire N)

Mellor, David

Stokes, John

Mills, Iain

Stradling Thomas, Sir John

Mitchell, Andrew (Gedling)

Sumberg, David

Mitchell, David (Hants NW)

Summerson, Hugo

Moate, Roger

Tapsell, Sir Peter

Montgomery, Sir Fergus

Taylor, Ian (Esher)

Morris, M (N'hampton S)

Taylor, John M (Solihull)

Morrison, Hon P (Chester)

Taylor, Teddy (S'end E)

Moss, Malcolm

Temple-Morris, Peter

Nelson, Anthony

Thompson, D. (Calder Valley)

Neubert, Michael

Thompson, Patrick (Norwich N)

Newton, Rt Hon Tony

Thornton, Malcolm

Nicholls, Patrick

Thurnham, Peter

Nicholson, David (Taunton)

Townend, John (Brldlington)

Onslow, Rt Hon Cranley

Townsend, Cyril D. (B'heath)

Page, Richard

Tracey, Richard

Paice, James

Tredinnick, David

Parkinson, Rt Hon Cecil

Trippier, David

Patnick, Irvine

Trotter, Neville

Patten, Chris (Bath)

Twinn, Dr Ian

Patten, John (Oxford W)

Vaughan, Sir Gerard

Pawsey, James

Waddington, Rt Hon David

Peacock, Mrs Elizabeth

Wakeham, Rt Hon John

Porter, Barry (Wirral S)

Waldegrave, Hon William

Porter, David (Waveney)

Walden, George

Portillo, Michael

Waller, Gary

Powell, William (Corby)

Walters, Dennis

Price, Sir David

Ward, John

Rattan, Keith

Wardle, C. (Bexhill)

Raison, Rt Hon Timothy

Warren, Kenneth

Rathbone, Tim

Watts, John

Redwood, John

Wells, Bowen

Renton, Tim

Wheeler, John

Rhodes James, Robert

Whitney, Ray

Rhys Williams, Sir Brandon

Widdecombe, Miss Ann

Riddick, Graham

Wiggin, Jerry

Ridsdale, Sir Julian

Wilshire, David

Rifkind, Rt Hon Malcolm

Winterton, Mrs Ann

Roberts, Wyn (Conwy)

Winterton, Nicholas

Roe, Mrs Marion

Wolfson, Mark

Rossi, Sir Hugh

Wood, Timothy

Rowe, Andrew

Woodcock, Mike

Rumbold, Mrs Angela

Young, Sir George (Acton)

Ryder, Richard

Younger, Rt Hon George

Sainsbury, Hon Tim

Sayeed, Jonathan

Tellers for the Ayes:

Scott, Nicholas

Mr. Robert Boscawen and

Shaw, David (Dover)

Mr. Mark Lennox-Boyd.

Shaw, Sir Michael (Scarb')

NOES

Abbott, Ms Diane

Beith, A. J.

Adams, Allen (Paisley N)

Bennett, A. F. (D'nt'n & R'dish)

Allen, Graham

Bermingham, Gerald

Archer, Rt Hon Peter

Blair, Tony

Armstrong, Ms Hilary

Blunkett, David

Ashdown, Paddy

Boateng, Paul

Ashton, Joe

Boyes, Roland

Banks, Tony (Newham NW)

Bradley, Keith

Barnes, Harry (Derbyshire NE)

Brown, Gordon (D'mline E)

Barnes, Mrs Rosie (Greenwich)

Brown, Nicholas (Newcastle E)

Battle, John

Bruce, Malcolm (Gordon)

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Buckley, George

McAllion, John

Callaghan, Jim

McAvoy, Tom

Campbell-Savours, D. N.

McCartney, Ian

Carlile, Alex (Mont'g)

Macdonald, Calum

Clarke, Tom (Monklands W)

McFall, John

Clay, Bob

McKay, Allen (Penistone)

Clelland, David

McLeish, Henry

Clwyd, Mrs Ann

Madden, Max

Cook, Frank (Stockton N)

Mahon, Mrs Alice

Corbyn, Jeremy

Marek, Dr John

Cousins, Jim

Marshall, Jim (Leicester S)

Cox, Tom

Martin, Michael (Springburn)

Cryer, Bob

Meacher, Michael

Cummings, J.

Meale, Alan

Cunliffe, Lawrence

Michael, Alun

Cunningham, Dr John

Michie, Bill (Sheffield Heelsy)

Dalyell, Tarn

Moonie, Dr Lewis

Darling, Alistair

Morgan, Rhodri

Davies, Ron (Caerphilly)

Morley, Elliott

Davis, Terry (B'ham Hodge H'I)

Mowlam, Marjorie

Dixon, Don

Mullin, Chris

Dobson, Frank

Murphy, Paul

Doran, Frank

Nellist, Dave

Ewing, Harry (Falkirk E)

O'Neill, Martin

Faulds, Andrew

Patchett, Terry

Field, Frank (Birkenhead)

Pendry, Tom

Fisher, Mark

Pike, Peter

Flannery, Martin

Prescott, John

Flynn, Paul

Primarolo, Ms Dawn

Foster, Derek

Quin, Ms Joyce

Fraser, John

Roberts, Allan (Bootle)

Fyfe, Mrs Maria

Robertson, George

Galbraith, Samuel

Robinson, Geoffrey

Garrett, John (Norwich South)

Rooker, Jeff

Garrett, Ted (Wallsend)

Rowlands, Ted

Golding, Mrs Llin

Ruddock, Ms Joan

Gordon, Ms Mildred

Sedgemore, Brian

Grant, Bernie (Tottenham)

Shore, Rt Hon Peter

Griffiths, Win (Bridgend)

Skinner, Dennis

Harman, Ms Harriet

Smith, Andrew (Oxford E)

Hattersley, Rt Hon Roy

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

Haynes, Frank

Smith, Rt Hon J. (Monk'ds E)

Heffer, Eric S.

Snape, Peter

Henderson, Douglas

Soley, Clive

Hinchliffe, David

Spearing, Nigel

Holland, Stuart

Steinberg, Gerald

Home Robertson, John

Stott, Roger

Hood, James

Strang, Gavin

Howarth, George (Knowsley N)

Taylor, Mrs Ann (Dewsbury)

Howells, Geraint

Taylor, Matthew (Truro)

Hoyle, Doug

Thompson, Jack (Wansbeck)

Hughes, John (Coventry NE)

Wall, Pat

Hughes, Robert (Aberdeen N)

Wallace, James

Hughes, Sean (Knowsley S)

Walley, Ms Joan

Hughes, Simon (Southwark)

Wardell, Gareth (Gower)

Illsley, Eric

Wareing, Robert N.

Janner, Greville

Welsh, Michael (Doncaster N)

Jones, Barry (Alyn & Deeside)

Williams, Alan W. (Carm'then)

Jones, Martyn (Clwyd S W)

Wilson, Brian

Kaufman, Rt Hon Gerald

Wise, Mrs Audrey

Kennedy, Charles

Worthington, Anthony

Lamond, James

Wray, James

Leadbitter, Ted

Young, David (Bolton SE)

Leighton, Ron

Lewis, Terry

Tellers for the Noes:

Livsey, Richard

Mr. Ken Eastham and

Lloyd, Tony (Stretford)

Mr. Ray Powell.

Question accordingly agreed to.
Resolved,
That the draft Precept Limitation (Prescribed Maximum) (Inner London Education Authority) Order 1988, which was laid before this House on 29th January, be approved.

PETITION

  Rating Reform
  11.56 pm
  Mr. John McAllion: I wish to present a petition which prays that this honourable House should repeal the Abolition of Domestic Rates Etc. (Scotland) Act 1987.
  The petition comes from Tayside regional council. It has been signed by all the members of the Labour administration, including the convenor of the council, Mr. Ron Tosh, and the leader of the administration, Mr. Chris Ward. It has also been signed by the members of the Scottish National party group. Together with the Labour group, they make up a clear majority on Tayside regional council.
  Both groups represent a clear majority of the people in Tayside. They reject the poll tax in Scotland for a number of reasons. It is unjust and unfair. It favours the rich. The tax will be costly to collect. Most people in Scotland believe it will be unworkable. It is also a serious infringement of the civil liberties of the Scottish people. It is the sincere wish of the Tayside regional council that the House repeal the Act.
  To lie on the Table.

Opencast Mining (Deeside)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Ryder.]
11.58 pm
Mr. Barry Jones: I apologise for the state of my voice. I am glad to see the Minister in his place. I hope he will help my constituents by decisive intervention. The subject is opencast mining, understandably an emotive issue. There is much public interest in opencast mining. It greatly affects the quality of life of local people and it is assuming increasing importance for the public, for local councils and for British Coal.
I have interviewed my constituents at Cheapside. They are deeply concerned, but they are full of fight, resource and determination. In my constituency there is widespread apprehension because the Opencast Executive wants to mine in areas apart from Cheapside and Ewloe.
The Minister probably knows that I have corresponded with Sir Robert Haslam of British Coal on this issue. The Minister knows that I have tabled written questions and posed oral questions to the Secretary of State. I have also written to Ministers and they have replied courteously. I have invited Ministers to visit the Cheapside site and to meet the action committee in that area. Last week there was a large and successful public meeting. It took place in Ewloe and it backed the protesters.
My aim in this debate is to persuade the Under-Secretary of State to move heaven and earth to persuade the Opencast Executive not to mine coal at the Cheapside site. Better still, I want him, in conjunction with the Department of Energy, to instruct British Coal to cease planning to extract coal from an attractive area such as Cheapside.
Nationally, I think it is time that the Government drew up a plan for opencast coal production. Additionally, I believe that the Government should begin a phased reduction of opencast coal production. Moreover, I urge the Government to revise their planning guidelines for opencast coal workings as currently set out in the circulars of the Department of the Environment and the Scottish and Welsh Offices.
The public inquiry opened on Tuesday at Queensferry leisure centre just days after hearing of the closure proposals for two deep mine pits in south Wales where a total of 2,000 jobs are to go. My constituents, who oppose the Opencast Executive, are bewildered. They know of the harrowing unemployment figures in the south Wales valleys, where more than one in four men are frequently out of work and they know that Cheapside is an attractive area environmentally. They say, "Keep the work for the south Wales valleys and save the Cheapside community from the impact of explosions, earth movement and many forms of stress."
I support the action committee of the residents of Liverpool road and Smithy lane who oppose the Cheapside British Coal proposals. I can tell the House that the local community is united. It is very well led. I pay tribute to Mr. John Iball of Four Winds, Liverpool road who has organised so well. Mr. Iball and his committee have had the loyal support of local councillors such as Mr. Ivor Roberts JP, Mr. Tom Middlehurst and Mr. Glen McIver. Indeed, there has been all-party support for the committee.

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When I visited the residents of Liverpool road I talked not only to Mr. and Mrs. Iball in their home but to Mr. Gary Feather and his son Timothy. Mr. Feather lives in Smithy lane at Gwelfryn and, arguably, he faces the greatest difficulty. I have also discussed matters with Mr. E. Jackson JP of Millbank and Mr. K. Morris of Halmore, Liverpool road, to name but a few.
Nobody should have an earth barrier 6 ft from their garden wall. Happily, Clwyd county council opposes the Opencast Executive and supports my constituents. The district council of Alyn and Deeside supports my constituents at Cheapside. Indeed, it has formed an opencast coal sub-committee to support the residents. It has supported the community by submitting a planning statement. The Hawarden community council objects to the Opencast Executive's proposals. The Buckley town council opposes the proposals. It is already an important consideration that all local government units, of whatever size, have come out strongly against the proposals. I urge the Government to bear that in mind when they make their decision and when they receive the planning inspector's proposals.
It is important to note that every unit of local government is supportive of the community that now resists the Opencast Executive's proposals. They are elected bodies, and they are important units in the local government of Clwyd. Indeed, Clwyd county council is taking the lead in protecting residents who live near the Cheapside site.
I want the Minister to give considerable weight to the fact that the county, district, town and community councils are all on the residents' side. The site is close to the rear of some delightful homes. Fine families live in them. If a large earth wall is built, an attractive part of the countryside will be torn apart. The Minister is a fair man. He and his colleague the Secretary of State will want to bear in mind the important statements that the local authorities have made.
Although people in the Cheapside area are worried, they are not the only ones in my constituency who are worried. The residents of Buckley are also apprehensive. We have even heard rumours about proposals for the Connah's Quay area in the locality of Wepre.
Cheapside has attractive field patterns. The hedgerows are important. They are an integral part of the countryside. There are numerous mature trees and an important wildlife habitat. It is a pleasing scene. The wild flowers, grasses and mosses are valued. From residents' homes facing the Cheapside site, views of the countryside are good—too good to rip apart. I know the area well. I was born in my constituency—indeed, two miles from the Cheapside site. As a youngster, I was familiar with the area.
My constituents are apprehensive on environmental grounds. It is not an exaggeration to say that they dread the prospect of great noise in general and the prospect of periodic sustained blasting in particular. No hon. Member would wish to live adjacent to such noise and potential persistent disruption of domestic life. My constituents can see difficulties in respect of the Opencast Executive's heavy lorries and traffic flows on the busy A494 trunk road. There is a road safety aspect. Local people believe that
480
heavy lorries leaving and entering the site will make things difficult. Being high powered, the lorries are bound to make a contribution to noise levels.
My constituents of Cheapside dispute the need for the Opencast Executive's initiative. It is interesting that the adjacent town council of Buckley, a large authority which meets regularly, has donated £100 to the action group. It is throwing its not inconsiderable weight behind the Cheapside campaign. The Alyn and Deeside district council is considering authorising a virement to meet costs. The Alyn and Deeside council is a large and important local authority. As I have said, it is unanimously throwing its weight behind the protesters. The Hawarden community council has retained a solicitor to ensure that its views are made known in support of the residents at the public inquiry that is taking place this week.
The opposition to this 100-acre proposal is well briefed and formidable. My constituents know that excavations would go 160 ft deep. That depth would be reached by the use of the most modern and large machinery and equipment, which would imply persistent noise from engines and movements. To achieve a depth of 160 ft, there would be a requirement to blast through several layers of sandstone. We know that 25 lorries will operate daily on the site and on the roads leading in and out. This is too much.
I prevail upon the Minister to meet the residents. Can I persuade him to visit Cheapside? If the executive has its way, my constituents will endure an agony, and one which I should like them to be spared.
If a line is drawn from the Severn to the Wash, the shallow coal measures are to the north. They are on the east and west coasts of Scotland, the north and south of Wales, in Cumbria, the north-east of England, south Yorkshire, parts of Lancashire and Nottingham and Leicester, for example. This was ordained millions of years ago. I submit that the north is taking the strain, and I want the Government to lessen it and to intervene to the satisfaction of my constituents.
The superbly organised Coalfield Communities Campaign has published its valuable report on opencast coal and I urge the Minister to undertake to read it. I hope that he will urge the Secretary of State to do so as well. Previously, the right hon. Gentleman was Secretary of State for Energy, which means that he has many insights into the energy industry. I can assure the Under-Secretary of State that, if he brings this important document to the notice of his right hon. Friend, he will be thanked, and perhaps rewarded. I want Ministers to study it. With my own insight of the Welsh Office, I hope that a departmental meeting will be called. I hope also that Ministers will ensure that their officials or advisers will note the document and its conclusions.
The Coalfield Communities Campaign is a nonpolitical body. It is drawn, organised, researched and led by local authorities throughout Britain which are based on the existing coalfields. It is careful to be non-political and non-partisan in that sense. It has at heart the best interests of the citizens living in the coalfields. It has been drawn inexorably in its several years of existence led by its chairman to consider the impact of opencast mining upon communities.
This document, published only last week, is important. I have a high regard for those who lead the Coalfield Communities Campaign. The Minister should know that a number of local authorities in Wales are attached to the

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campaign, and he could do worse than to seek to meet its Welsh arm. He will learn only positive things from it. It has a first-class reputation.
I make a plea on behalf of my constituents, a beleaguered community of ordinary men and women who are up against the big, bureaucratic power of British Coal and its subsidiary, the Opencast Executive. I am trying now to link my locality and constituents to national policy. A strategic choice needs to be made between closing down mine capacity and restricting opencast working. The choice is as basic as that. The countryside can be shattered by opencast working. Wildlife, wild flowers, grasses, hedgerows, mature trees and saplings and field patterns of hundreds of years' standing will be hugely affected.
This is the case for the Cheapside community. Everyday, family life in the area will be affected by noise, dust and blasting. Traffic conditions will deteriorate, and citizens who have invested their all in their homes, and in their improvement and alteration — at the cost of all their time, money and efforts over a long period—will be blighted. Youngsters will be brought up in these conditions, if the Opencast Executive has its way.
I make a plea to the Minister to take action that will be of service and help to my constituents. I offer the following positive proposals, as outlined by the Coalfield Communities Campaign. First, the Government should draw up a national plan for opencast coal production. They should consult widely in the industry and with the local and planning authorities.
Secondly, the Government should begin a phased reduction of opencast coal production, with immediate effect. Thirdly, they should revise their planning guidelines for opencast working, as set out in their circulars for the Department of the Environment, and the Welsh and Scottish Offices. The aim should be a tougher environmental criterion for the Opencast Executive.
Finally, I refer to the report of the Coalfield Communities Campaign opencast coal working party, entitled, "Ewloe Opencast Coal". It is wrong to claim that opencast mining is necessarily cheaper than deep mining, for which demand is falling. So, the campaign says, opencast working may not enjoy the financial advantages claimed for it by British Coal, which are based on average rather than marginal costs. The signs are that the marginal costs of opencast and deep mining are broadly comparable. In that context, the wider social and environmental costs involved assume an increased importance. Profits from opencast coal mining do not subsidise losses in the deep mining sector. That is the assertion of the Coalfield Communities Campaign.
In the short term British Coal aims to eliminate such losses, which are in any case covered by profits within the deep-mine sector. In the long term— this is of crucial importance — British Coal's costs per annum for new deep-mined capacity are such that cross-subsidisation would he unnecessary and may in certain circumstances be impossible.
The Minister is a good listener and I hope that he will very much take to heart the points that I have made for a splendid community, fighting hard to retain its environment and avoid an awful impact upon its living conditions. Again, I urge him to study carefully the Coalfield Communities Campaign document and to take action urgently to help my constituents.
12.20 am
The Parliamentary Under-Secretary of State for Wales (Mr. Ian Grist): I thank the hon. Member for Alyn and Deeside (Mr. Jones) for his kind and polite words. I commiserate with him on his sad, but I hope not painful, voice this evening.
I do, of course, appreciate that he and many of his constituents are concerned about the implications of British Coal's proposals for the land at Ewloe. Indeed he wrote to my right hon. Friend the Secretary of State for Wales about them in October last so that even before tonight we were in no doubt about where he stood. He has, as always, stated most persuasively the doubts and fears of his constituents, and the House fully appreciates the support that he has given them.
Opencast development is always contentious arid no one knows better than we in Wales the strong feelings that new proposals so often give rise to both among prospective neighbours of the development and among people and organisations who feel strongly about conservation of the environment.
However, I am sure that he will recognise that l can say nothing about the planning merits of the proposals or about the likely outcome of the planning appeal and the associated orders. Ministers of successive Administrations of all political colours have made it a firm practice never to comment on appeals under consideration by them because of the paramount need that they remain objective at all times and to ensure that their decisions on such matters are given in accordance with the highest standards of openness and impartiality.
The hon. Gentleman's remarks will of course be taken into account by my right hon. Friend when he comes to consider the proposals in due course. I shall also ensure that they are conveyed to the inspector who is presently holding the local inquiry in this case and I shall ask him to distribute copies to the parties to the appeal w hen the inquiry resumes.
The hon. Gentleman's choice of subject for tonight's debate gives me the opportunity to put the Ewloe proposal in the context of planning appeals generally. Many planning applications which come to my right hon, Friend on appeal after being refused by the local planning authority are controversial and one would certainly include opencast working in that category.
I should like to begin my remarks with a brief description of the appeal process which the British Coal proposal at Ewloe is now undergoing. The right of appeal goes back to the legislation of 1947. Although many refinements of procedure have been introduced over the years, the basic right of appeal remains unaltered. Any applicant for planning permission who is refused permission or who fails to receive a decision within a prescribed time can appeal to my right hon. Friend. This basic right is available just as much to massive organisations such as British Coal as to the private individual, upset because his house extension cannot be approved. Similarly, the rules which govern consideration of an appeal apply to both big and small alike.
An appeal under section 36 of the Coal Industry Act 1971 serves three main purposes. First, it allows anyone whose application is refused by a local planning authority to seek a second opinion on the planning merits of the proposal. Secondly, it allows planning Ministers to supervise the development control process and on

483
occasion to reassert or to clarify national policy, something which is in fact happening as regards opencast coal at the moment. Thirdly, it gives the public a say, allowing it to question the assumptions and arguments of the main protagonists in a planning dispute and to put forward alternative points of view.
Throughout the last 40 years the main components of the appeals process have been openness, fairness, impartiality, the opportunity to state a case in writing or appeal before an appointed person and the statutory right of appeal to the High Court against the decision on a point of law or of procedure. Those five components represent the judicial elements of the process. The decisions themselves are discretionary and this is what gives the appeal process its administrative character and of course that leaves the decision itself to the judgment of either the inspector or, in a recovered case, of the Secretary of State.
Most decisions are taken by inspectors. In Wales we now have a full-time force of 12 inspectors and we can also call on the services of a number of part-time officers. They are all experienced, both in the planning process and in matters of policy that are applicable generally or are particularly applicable to Wales.
The transfer to inspectors of the responsibility for decision-making has taken place gradually over a number of years and about 95 per cent. of appeals are now handled in this way, but the Secretary of State reserves the right to recover jurisdiction in selected cases and the Ewloe case is clearly one where that is appropriate. The inspector's role here is to obtain the facts, to conduct an impartial inquiry and to make a report to the Secretary of State. Of course the inspector is not a maker of planning policy. In that matter he takes the lead from my right hon. Friend, who works on the basis that appeal decision letters are not the right place for making such policy. It is, after all, a basic principle of the appeals system that no part of the decision should come as a surprise to the parties.
Every appellant has the right to a local inquiry, though most people choose to have their appeals decided by the written representations method. The appellant must be told in advance of the facts and arguments which will be deployed against him at the inquiry. The conduct of the inquiry is primarily a matter falling within the discretion of the inspector, but there are certain prescribed rules which have to be followed. Those rules are at present under review and the revised version will be laid before the House later this year. The various improvements which are proposed should assist the process of preparing for the inquiry, make the proceedings shorter and generally result in the giving of earlier decisions.
484
In particular, we hope to make more effective use of the period before the inquiry opens. Early exchanges of information, for example, proofs of evidence, at that stage, will help the inspector and the parties to identify the principal issues and to avoid discussion of matters which are not relevant to the appeal. We take the view that the inquiry should be no place for surprise tactics.
People other than the main parties are, of course, allowed to attend the inquiry and, at the discretion of the inspector, present their views in person or through a representative. That is most important in the kind of case that the hon. Member has raised tonight. For here it is not only matters of local and central policy that may be important, nor indeed general issues about conservation of the environment. The inspector will also want to listen to and consider very carefully how the lives of people in the neighbourhood of the proposal are likely to be affected by the development and to weigh those considerations with all the others.
When everyone has been heard the inspector closes the proceedings and goes away to write his report. In recovered cases this is considered within the Welsh Office and my right hon. Friend takes his decision. Great care must be taken to see that as far as possible the decision is legally correct. The 1971 Act provides that an appeal decision is open to challenge in the High Court from any "aggrieved person" who believes he can show that the decision is defective on a point of procedure or law. The minds of officials and of Ministers must, therefore, be addressed to each case in a proper manner. This all takes time but is absolutely essential.
In February 1984, circular 13/84 called "Opencast Coal Mining" was published jointly by the Department of the Environment and the Welsh Office. That circular contained a number of observations on the subject in general and a set of guidelines against which planning decisions should be taken.
As I have said, local planning authorities or the Secretary of State on appeal have to consider both the development plan and other material considerations. The circular indicated that structure plan policies and general proposals for opencast working are expected to indicate in general terms the areas in which there are presumptions for and against opencast working. Local plans should define these areas in detail—
The motion having been made after Ten o'clock and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at twenty-eight minutes past Twelve o'clock.