Commons Sitting of 6 July 1989

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

  ASSOCIATED BRITISH PORTS (No. 2) BILL (By Order)
  Order read for resuming adjourned debate on Question—[23 May]—That the Bill be now read the Third time.
  Debate to be resumed on Thursday 13 July

  BRITISH RAILWAYS (PENALTY FARES) BILL [Lords] (By Order)
  Order for further consideration, as amended, read.
  To be further considered on Thursday 13 July.

  BROMLEY LONDON BOROUGH COUNCIL (CRYSTAL PALACE) BILL (By Order)
  Orders for consideration, as amended, read.
  To be considered on Thursday 13 July.

  LONDON REGIONAL TRANSPORT (No. 2) BILL (By Order)
  Considered; to be read the Third time.

  QUEEN MARY AND WESTFIELD COLLEGE BILL [Lords] (By Order)
  Orders for Second Reading read.
  To be read a Second time on Thursday 13 July.

Oral Answers to Questions
  NATIONAL FINANCE

    Devaluation
    Mr. Denzil Davies: To ask the Chancellor of the Exchequer whether it is the policy of Her Majesty's Government to resist a devaluation of the pound sterling.
    The Chancellor of the Exchequer (Mr. Nigel Lawson): The Government are determined not to allow the firmness of their monetary stance to be undermined by a depreciation of the exchange rate.
    Mr. Davies: May I remind the right hon. Gentleman that since he became Chancellor the pound has been devalued by 25 per cent. against the deutschmark? Whatever the Government's policy, is it not now obvious that with the balance of payments deficit likely to be horrendous for some considerable time, with foreigners now depositing £25 billion in very short-term money in the City of London—a figure which exceeds the Government's foreign currency reserves—and with the Government having vetoed entry to the European monetary system, which could have stabilised those reserves, the stage is now set for a major run on the value of sterling? Is the Chancellor aware of that?
    Mr. Lawson: Well, in the first place I would like to thank the right hon. Gentleman who is, of course, a former Treasury Minister, for supporting the policy of the Government when he said last month:
    "Mr. Lawson has got no option to what he is doing. The Labour Party idea that you should have credit controls is rubbish. There is no way you can control credit except by controlling the price of credit, and the price of credit is Bank Rate.
    The Opposition Front Bench, in short, is all over the place."
    He is quite right, so I would like to congratulate him on that.
    As for the question of what has happened to sterling, it is true—[Interruption.] It is not the case that entry to the EMS has been vetoed. My right hon. Friend the Prime Minister reaffirmed, at the Madrid European Council, our intention to join the exchange rate mechanism of the EMS. I do not think that it is really very helpful for the right hon. Gentleman to try to talk the pound down. It makes him look particularly silly in a week in which the pound has been rising.
    Mr. Beaumont-Dark: Does my right hon. Friend agree that it is important to ensure that the pound finds its own true value? Does he further agree that, in the end, the most important factor for Britain will be its export potential? Is it not true that with the pound at present levels British industry, at long last, has a chance to compete? If the pound is too high, there is difficulty with imports and exports. My right hon. Friend's policy of allowing the pound to find its own level is right, as long as he stops interfering.
    Mr. Lawson: I have noted, of course, a certain asymmetry in my hon. Friend's views. He is very anxious that the pound should find its own level when he thinks the pound is likely to go down; he is very anxious that

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    everything should be done to prevent any movement when he thinks the pound is likely to go up. I have noticed that there are a number of hon. Members on the other side of the House and also some outside this House who take that rather asymmetrical view. [Interruption.] What I do tell my hon. Friend is that he is absolutely right that the present climate is one in which British exporters have every chance of doing very well in world markets, and indeed I am glad to say that they are doing well. Exports are well up, and that was shown particularly in the most recent trade figures.
    Ms. Short: Does the Chancellor agree that the balance of payments problem shows that the pound is over valued? I thought that he believe in market forces. Why does not he stop intervening, allow the pound to drop and then join the EMS? Is not that the answer to our problems?
    Mr. Lawson: I am interested to hear the hon. Lady, who does not normally support her Front-Bench spokesmen, on this occasion supports the inflationary policies that they are putting forward, including a substantial devaluation of the pound. That would not be helpful to the British economy; least of all would it be helpful to the struggle against inflation. The Government have no intention of following that policy.

    Value Added Tax
    Mr. Amess: To ask the Chancellor of the Exchequer what representations he has received about zero rating of value added tax for hospital radio broadcasting equipment.
    The Economic Secretary to the Treasury (Mr. Peter Lilley): My right hon. Friend has received one letter since the reply I gave to my hon. Friend on 6 April this year.
    Mr. Amess: Will my hon. Friend join me in congratulating the national associations of hospital broadcasting organisations on their magnificent work throughout Britain in broadcasting to people who are unwell? Will my hon. Friend consider giving them further help by zero-rating VAT on hospital radio broadcasting equipment, treating it in the same way as talking books for the blind?
    Mr. Lilley: I am sure that the House will want to join me in paying tribute to the marvellous work done by hospital broadcasting in many of our constituencies, not least my own, and in paying tribute to my hon. Friend the Member for Basildon (Mr. Amess) for his consistent support for hospital broadcasting. As he knows, under EC law we are constrained in our ability to introduce new zero rates. We got away with extending the zero rates on printed matter to newspapers for the blind because of the analogy between the two, but that would not work in the case of hospital broadcasting equipment, which is not specialised and is not provided for hospitals alone. I hope that the hospital broadcasting movement will benefit from the many other moves that we have made to encourage increased support for charities.
    Rev. Martin Smyth: I welcome the Minister's response in paying tribute, but bearing in mind that in the scriptures tributes are the same as taxes, will he keep pressing to give them the benefit of that tribute?
    Mr. Lilley: We shall continue our efforts to encourage charities in every way that we can, and we believe that the primary way in which to do that through the fiscal system is to encourage people to give more and to increase support. In that we have been successful, and charitable giving has more than doubled in real terms.
    Mrs. Peacock: I appreciate what my hon. Friend says about the work of hospital broadcasting, but will he recognise the difficulties of many of those stations, particularly when they move to magnificent new hospital premises and have to re-equip completely, as my hospital radio station has had to do? What words of encouragement can he give to enable them to face the massive VAT bills that they will undoubtedly have to pay?
    Mr. Lilley: As I have said, there is no prospect of our altering the VAT treatment of hospital radio equipment, but I hope that the great support that the movement has in the House will be reflected in the support that everybody gives such organisations in our constituencies so as to ensure that they are properly funded to carry on the great work that they do for patients.

    Economic Policy
    Mr. Martyn Jones: To ask the Chancellor of the Exchequer what representations he has received from institutions in the City of London about United Kingdom economic policy.
    Mr. Win Griffiths: To ask the Chancellor of the Exchequer what representations he has received from institutions in the City of London about United Kingdom economic policy.
    The Chief Secretary to the Treasury (Mr. John Major): My right hon. Friend often receives advice from the City, most of it unsolicited.
    Mr. Jones: From that reply I take it that the Chancellor may not have seen the Chase Investment bank report which stated that inflation was likely to peak at over 9 per cent. this year and that 18 per cent. interest rates would be needed to bring inflation down to 4 or 5 per cent. by 1992. Bearing in mind that the report was based on the Chancellor's Treasury model, will the Chancellor confirm that his young friends in the City are correct and that he would be prepared to put interest rates up to 18 per cent. by 1992?
    Mr. Major: If my right hon. Friend had seen that report —I am not sure whether he has—he would certainly not hale agreed with it.
    Mr. Griffiths: Has the Minister received any representations from the City about how to deal with the problem of directors' huge pay increases? He may have seen the report that five of the top 100 company directors had increases of 50 per cent. and 91 had on average a 28 per cent. increase in their pay? Bearing in mind the Chancellor's views on pay and inflation, has he proffered them any advice on how to bring those increases down to a reasonable level, or does he believe in allowing wages to go up and keeping interest rates high?
    Mr. Major: I do not support unjustified pay increases from any source, including directors—and neither does my right hon. Friend. While I have no intention of defending them, they are not under our control.
    Mr. John Townend: Does my right hon. Friend agree with the remarks made yesterday by the Governor of the Bank of England, when he commented that aggressive advertising by the banks to persuade people to borrow more so that they can spend more makes him feel uncomfortable?
    While credit controls are neither desirable nor practicable, does my right hon. Friend agree that the clearing banks and big City institutions should act responsibly? Would it be a good idea for the governor to invite the chairmen of the clearing banks to the delightful garden behind his office and—over a long, cool summer drink—tell them that it is in their long-term interests to act in the long-term interests of the country?
    Mr. Major: I share the governor's instincts, but what action he takes is a matter for him. I certainly do not believe that credit controls would be the answer.
    Mr. Charles Wardle: Is it not imperative for the City and for industry alike that my right hon. Friend's chief and abiding priority continues to be controlling inflation—even though, in the short term, that remedy may be painful to borrowers—because inflation threatens competitiveness, erodes savings, and threatens jobs?
    Mr. Major: My hon. Friend is entirely right. That is the central proposition before the Government at present, and my right hon. Friend has put in place the policies to bring down inflation.
    Mr. Beith: Is it not widely recognised in the City that London would be the obvious centre for a central European bank, and that Britain should be in the European monetary union of which that central bank would be a part? From a counter-inflationary point of view, would it not be better if that central bank had more of the independence enjoyed by the Bundesbank, rather than the relationship that the Bank of England has with the Government?
    Mr. Major: These are matters that will have to be addressed in the future, but I am bound to say that others may hold views that differ from the premise of the hon. Gentleman's question.
    Mr. Latham: Before my right hon. Friend throws the unsolicited junk mail that he receives from the City into the wastepaper basket, will he ask some of the teenage scribblers to send him a table showing their predictions of economic outcome in the last five years compared with the actual outturns?
    Mr. Major: I shall be very happy to study those projections and the eventual outcome. It is undoubtedly true that over a run of years, Treasury forecasts have been the most accurate.
    Mr. Gordon Brown: As the Chancellor spent yesterday attacking the railmen, will the Chief Secretary take the opportunity that I am giving him today to condemn the pay increases which have given Sir Jeffrey Sterling a rise of £1 60,000 in one year alone, Lord King of British Airways £100,000 in one year alone, and the head of Warburg
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    £350,000—on top of the top-rate tax cuts awarded to them last year? Will the Chief Secretary explicitly comdemn such pay rises—yes or no?
    Mr. Major: Yesterday, my right hon. Friend condemned the strike, not individual railmen. If the hon. Gentleman had listened, he would have heard what I said earlier about unjustifiable pay demands. They are unjustifiable whether they are made by directors or by workers.

    Income Tax
    Mr. Summerson: To ask the Chancellor of the Exchequer what is his estimate of the extra yield of income tax if the basic rate were raised to 33 per cent.
    The Financial Secretary to the Treasury (Mr. Norman Lamont): An 8 per cent. increase in the basic rate of income tax to 33 per cent. would yield about £13·5 billion extra in a full year at 1989–90 income levels, assuming that there were no behavioural effects.
    Mr. Summerson: Will my right hon. Friend confirm that it is no part of Government policy to increase the burden of income tax, whereas, so far as anyone can tell, that is precisely the policy of the Labour party?
    Mr. Lamont: As my hon. Friend knows very well, we have reduced the burden of taxation and shall continue to do so. Judging by the expenditure plans put forward by the Labour party, if the Opposition ever came to power they would be well on the way to putting tax up to the level it was when they were last in office, which was 33p. Every day we hear of Labour policies such as a pensions increase equal to 1p on income tax, an increase in overseas aid equal to 1p on income tax, increased child benefit, a carer's allowance, renationalisation of the water industry and of British Telecom, and the introduction of a minimum wage. They would all have only one result, which would be to increase the basic rate of income tax to all taxpayers.
    Mr. Frank Field: Why do the Government put so much effort into boosting the nanny welfare state for taxpayers? Will the right hon. Gentleman confirm that if the Government phased out all tax benefits we could have a standard rate of tax of between 12p and 15p in the pound? Would that not be a radical tax policy and, if so, why do the Government not introduce it?
    Mr. Lamont: As the hon. Gentleman knows, in the Budgets this year and last year the Government blocked a significant number of loopholes. In last year's Budget, some £800 million was raised by the blocking of loopholes. We have taxed the use of company cars and blocked the forestry loophole. I agree that we should get marginal rates down and get average rates up.
    Sir William Clark: Does my right hon. Friend agree that, historically, a reduction in taxation has meant that there has been a greater take for the Chancellor of the Exchequer? Does my right hon. Friend agree that if taxation were increased, revenue to the Exchequer would decrease?
    Mr. Lamont: That, of course, was the point to which I referred when I spoke of behavioural effects. There must be some tax maximising rate. It cannot be true for ever

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    that, however much taxes are cut, more revenue will be raised. What we have done, especially at the top end, has increased the tax take.

    European Monetary System
    Mr. Simon Hughes: To ask the Chancellor of the Exchequer what is the latest figure that he has for the rate of inflation in the United Kingdom; and what is the average inflation rate for countries who are full members of the European monetary system.
    Mr. Lawson: Excluding owner-occupier housing costs in order to put the figures on a more comparable basis, United Kingdom inflation currently stands at 6 per cent. compared with an average of 44 per cent. for the countries which are full members of the European monetary system.
    Mr. Hughes: Given that the other inflation figure is 8·3 per cent. and not 6 per cent., when will the Chancellor say that our inflation will be low enough to allow us to join the exchange rate mechanism? What figure does he put on that inflation rate to allow us to join, given the conditions that he laid down before the Treasury and Civil Service Select Committee and that the Prime Minister laid down in Madrid?
    Mr. Lawson: On the first point that the hon. Gentleman has made, I have to tell him that he is mistaken. Of the other countries that he mentiooned, only one has mortgage interest payments in its index, and a great many of them—in fact, about a half of them—have nothing at all for owner-occupier housing costs, nothing at all. Therefore, the only way to have a truly comparable figure is to take owner-occupier housing out, which is what I did, and that is a very different comparison between the 6 per cent. and the 4¼ per cent. As for the second question that the hon. Gentleman put to me, the answer is: lower than it is today.
    Mr. Dykes: Does not the impressive experience of the EMS and the ERM show that it makes the vulnerable currencies in the system stronger rather than weaker? Are there not good lessons to be learnt for the pound sterling?
    Mr. Lawson: Certainly, it is true that all those countries that are members of the exchange rate mechanism of the EMS to my knowledge believe that this has been beneficial to them, but it is a mistake to infer from that that all one has to do to run a successful economic policy is to join the exchange rate mechanism of the EMS. That is very much not the case. The same hard choices that have to be taken outside the exchange rate mechanism have to be taken inside it as well.
    Mr. Foot: As it was obviously a major event in the control of our economic policy and inflationary policy, would the right hon. Gentleman care to tell us the exact terms of the apology that he received from the Prime Minister?
    Mr. Lawson: I have no wish to comment at all on private conversations that may or may not have taken place between my right hon. Friend the Prime Minister and myself. We are at one on the subject of economic policy.

    Taxation
    Mr. Couchman: To ask the Chancellor of the Exchequer what is his estimate of the number of people who would face a higher marginal rate of tax and national insurance if the top rate of income tax were raised to 50 per cent. and the employees' national insurance limit were abolished.
    Mr. Jacques Arnold: To ask the Chancellor of the Exchequer what is his estimate of the number of people who would face a higher marginal rate of tax and national insurance if the top rate of income tax were raised to 50 per cent. and the employees' national insurance limit were abolished.
    Mr. Norman Lamont: If the higher rate of income tax were raised to 50 per cent. and the employees' upper earnings limit for national insurance contributions were abolished, about 3·4 million single people and married couples, about 15 per cent. of the total, would face higher marginal rates of income tax or national insurance.
    Mr. Couchman: I am grateful to my right hon. Friend for that answer. Does he agree that this would raise the marginal rate to 59 per cent. and that such a calamitous rate would encourage another exodus of the skilled and the entrepreneurial? Would it not provide fuel for that pernicious industry of creative personal accounting which was so prevalent when the Labour party was in power?
    Mr. Lamont: My hon. Friend is, of course, right. That is not the only way in which the Labour party is proposing to increase taxes. As my hon. Friend said, it would put up the marginal rate for nearly 3½ million people, of whom 2 million are basic rate taxpayers, and another 1 million people, half of them pensioners, would lose as a result of the reintroduction of investment income surcharge. Another 24 million people in 12 million couples would also lose as a result of freezing the married couples' allowance and on top of all that, Labour would introduce a local income tax. That would take us straight back to the policies which destroyed incentives and crippled our economy in the 1970s.
    Mr. Jacques Arnold: What advice would my right hon. Friend give to the 2 million people who currently have a marginal tax rate of 25 per cent. and who would, nevertheless, be penalised by an extension of national insurance contribution? Is it not significant that 2 million families would be hit in that way if we had a Labour Chancellor of the Exchequer?
    Mr. Lamont: My hon. Friend is right. I am sure that thanks to him and to my hon. Friend the Member for Gillingham (Mr. Couchman) raising these matters, the warnings will be heeded and people will think carefully before voting Labour.
    Mr. Mullin: To keep the level of hyprocrisy to a minimum, will the Financial Secretary confirm that the percentage of gross domestic product consumed by taxation has increased since his Government came to power?
    Mr. Lamont: The percentage has increased, but the percentage taken by income tax has decreased. What we have done—and what the previous Government should have done—is to replace borrowing by sound finance.
    Mr. Ashton: Surely, it is the people at the top who live in the biggest and poshest houses—[Interruption]—who will also benefit most from the poll tax. Why should they have cuts at both ends of the scale—from the poll tax and income tax?
    Mr. Lamont: I am sorry that I did not hear much of the hon. Gentleman's question, except that I understand from the grin on his face that he is obsessed with people who live in the biggest and poshest houses.
    Mr. Marlow: If the purpose of taxation is to raise revenue rather than to punish people, is it not the case that since the Government have reduced the higher rates of taxation they have raised more revenue?
    Mr. Lamont: My hon. Friend is right. As I have observed before, the Conservative Government have found a new way of soaking and clobbering the rich.
    Mr. John Smith: Following the point made by my hon. Friend the Member for Sunderland, South (Mr. Mullin), can the Financial Secretary confirm that under this Government the proportion of national income paid in taxation has increased from 34·25 per cent. to 37·5 per cent.—a substantial increase? Will he explain what sense of equity there is in imposing on a person on £100,000 a year exactly the same liability in total national insurance as a person on £16,900 a year? In the case of the lower salary, that is 8 per cent. of income whereas in the case of the higher it is 1 per cent. of income. Is that not standing fairness on its head?
    Mr. Lamont: I have already answered the question from the hon. Member for Sunderland, South (Mr. Mullin). On the upper earnings limit for national insurance contributions, we have always adhered to the principle that it is important that the contributory principle should be recognised. If the right hon. and learned Gentleman wants to put up taxes, let him do so and not call it national insurance.

    Corporation Tax
    Mr. Colvin: To ask the Chancellor of the Exchequer what representations he has received on the basic rate of corporation tax.
    Mr. Lamont: A number.
    Mr. Colvin: I thank my hon. Friend for that very full reply. Will he confirm that over the past five years, in spite of cutting the rate of corporation tax from 53 per cent. to 35 per cent. for big companies and from 42 per cent. to 25 per cent. for small companies, the revenue actually received by the Exchequer from corporation tax has more than doubled? Although capital allowances have been reduced, investment in manufacturing industry is running at an all-time high. As the patient has responded so well to the treatment, why can we not have a bit more of the same tax-cutting medicine?
    Mr. Lamont: I note my hon. Friend's early Budget representation and I am sure that my right hon. Friend has done so as well. As my hon. Friend says, the United Kingdom has led the world in cutting corporation tax rates. We have reduced those rates by 17 points and, as my hon. Friend has said, the yield has soared. Of couse, that is largely because of the sound economy and the great
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    upsurge in profits that we have experienced. We shall certainly keep the matter under review as my hon. Friend suggests. It is also true that investment has in no way suffered. Indeed, investment has boomed since we removed capital allowances and reduced the rate.
    Mr. Foulkes: Can the Minister give a clue about whether the number of representations that he has received is nearer to the real level of inflation or to the fiddled figure that is used by his right hon. Friend the Chancellor, which does not include housing costs?
    Mr. Lamont: It was an extremely small number.

    European Monetary System
    Mr. Squire: To ask the Chancellor of the Exchequer what effect the entry of Spain has had on her Majesty's Government's policy on membership of the European monetary system.
    Mr. Lawson: None, though we will watch Spain's progress with interest.
    Mr. Squire: In our mutual enthusiasm for joining the exchange rate mechanism, does my right hon. Friend agree that Spain has an inflation rate of nearly 7 per cent. at present and will he confirm that those countries that are within the exchange rate mechanism and have not yet abolished capital controls will possibly face major pressures on their interest rates when they finally do so?
    Mr. Lawson: Of course, it is very important that all membr countries of the European Community abolish exchange controls in line with the directive which was agreed last year, and as my hon. Friend will know, most of the countries have to do that by 1 July 1990, including in particular France and Italy. It will be certainly a matter—as I told the Select Committee when I appeared before it on this subject—of very great interest to see how EMS fares after this abolition of exchange controls has taken place. I believe—and the Governor of the Bank of England stated when he gave evidence his belief—that the EMS would successfully survive that. It may be that some modifications will be required, but the EMS will successfully survive the removal of exchange controls by France, Italy and others. We shall have to see. The proof of the pudding will be in the eating.
    Mr. Robert Sheldon: Whatever fears we may justifiably have about the future economic policy of this country in the event of our joining the exchange rate mechanism, is the Chancellor aware that the greatest fear is that we may enter at too high a rate?
    Mr. Lawson: I realise that the Opposition are always in favour of devaluation. I know that they have a policy which is in some way similar to ours, concerning the exchange rate mechanism, but in one particular respect, totally different. They too wish to join the exchange rate mechanism of the EMS and they too believe that there are one or two conditions precedent, but their conditions are to secure the most inflationary environment they can, by devaluation of sterling first, and a change in the arrangements of the EMS to ensure that there is an inflationary climate throughout Europe. That is something which we wholly reject.
    Mr. Butterfill: Does my right hon. Friend agree that to suggest that we should have to have a withholding tax as the price for the abolition of exchange controls displays an extraordinary lack of confidence in the operation of a free market? Will he confirm that he will resist that ridiculous proposal?
    M. Lawson: I can confirm not only that I will resist this proposal, which would be totally harmful, I can confirm that I have been resisting it, and so successfully that there are now a large number of other countries that are resisting it. I am absolutely confident that no such European Community withholding tax will ever come into place.

    Value Added Tax
    Mr. Bill Michie: To ask the Chancellor of the Exchequer, what proportion of gross earnings a one-earner family on average earnings with two children paid in value-added tax in (a) 1979 and (b) 1989.
    Mr. Lilley: A married man on average male earnings with two children would have paid approximately 2·7 per cent. of his earnings in VAT in 1978–79 and 5 per cent. in 1988–89.
    Mr. Michie: Does the Minister agree that the £5·76 per week that the average family would have had if VAT was still at the same proportion of earnings would be welcome to those families and would help them a little to offset the extra costs that they have to pay in massive mortgage repayments because of the Chancellor's policies?
    Mr. Lilley: The significant fact is that over that period, which coincides with the lifetime of this Government, the average married man has had an increase in his real take-home pay—after taking account of prices and VAT —of more than 30 per cent. I do not think that people would have been prepared to trade that for the fiscal regime left behind by the Labour Government.
    Mr. Boswell: Does my hon. Friend accept that spending and income must be considered together? Will he remind the House by how much the starting figure at which a comparable family pays income tax has increased in the same period?
    Mr. Lilley: My hon. Friend is absolutely right and makes a valid point. We have increased the threshold by about a quarter in real terms, thus taking a considerable number of lower paid people out of the income tax regime altogether.
    Dr. Marek: The Economic Secretary will have heard the Financial Secretary say a few moments ago that the burden of taxation as a proportion of gross domestic product has increased under this Government. Will he take the next step and admit that that means that the British people have been taxed more heavily in the past 10 years under this Government than they were taxed under the previous Labour Administration?
    Mr. Lilley: We inherited public finances that were largely financed by borrowing. Initially, we had to finance part of that by increased taxation but more recently the burden of taxation as a proportion of GDP has been coming down. My right hon. Friend the Chancellor has made it absolutely clear that if ever a Government were
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    elected—which they will not be—with the policies that appeared in the recent Labour policy review, taxes would go up and up and up.

    Interest Rates
    Ms. Quin: To ask the Chancellor of the Exchequer what representations he has received from small businesses on the current level of interest rates.
    Mr. Major: My right hon. Friend has received a number of representations on this subject.
    Ms. Quin: Have the Government studied the recent survey by the Forum of Private Business, which shows that small firms are rapidly becoming the victims of high interest rate policies? Are the Government aware of the CBI's industrial survey showing the weakness of small firms' export orders? What advice are the Government now giving to small firms?
    Mr. Major: I have seen those reports. There is no doubt that interest rates are uncomfortable. But inflation would be more uncomfortable, would last longer and would be far more damaging. Monetary policy is specifically geared to bear down on inflation and so bring it down. That is in the interests of all business, particularly small business.
    Mr. Gow: Is it not the case that excessive monetary growth caused, and diminished monetary growth will cure, the monetary evil of inflation? Will my right hon. Friend confirm that he will maintain interest rates at such a level as to persevere in the abatement of inflation until we achieve his declared target of stable prices?
    Mr. Major: I can certainly assure my hon. Friend that we have no intention of relaxing on monetary policy until it begins to bear fruit.
    Mr. Haynes: When the Prime Minister comes in to the Chamber in a moment or two, will Treasury Ministers have a word with her and tell her to get rid of the Chancellor and farm him off back to the beautiful green fields of Blaby, because he has been a complete failure? He promised that the Government would help small businesses because that was where the jobs would come from and said that that would sort out the problems of the economy.
    Mr. Major: I disagree with what I could hear of what the hon. Gentleman said. We cherish the Chancellor and hope to keep him for a long time.
    Mr. Bellingham: Is the Chief Secretary aware that in west Norfolk unemployment has come down from a peak of 18 per cent. to less than 6 per cent.? The main reason for that is the success of the small firms sector, which has prospered under the Chancellor's policies. However, is my right hon. Friend aware that that sector is worried about the increase in inflation and supports policies that will bring inflation down?
    Mr. Major: I entirely agree. Unemployment has fallen in each and every region of the United Kingdom—without exception—and that has been happening for a considerable period of time. That is a direct result of the policies that my right hon. Friend has been following.
    Mr. Chris Smith: Is the Chief Secretary aware that bankruptcies among self-employed sole traders in London

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    and the south-east have risen by 28 per cent. in the past year, as a direct result of the Government's high interest rate policy? Does he show no concern for the small businesses throughout the country that are being forced to abandon re-equipping and investment decisions and, in many cases, being forced to lay off staff? Has he heard the verdict of the small business man in Gosport, who said that high interest rates were squeezing his business to choking point? Why does he not change his policy before it is too late?
    Mr. Major: The hon. Gentleman can rattle his chains all he likes, but the creation of new businesses is now running at an unprecedented rate of 1,300 new businesses every week. The hon. Gentleman can never tell us when that happened under any Labour Government.
    Mr. Oppenheim: Does my right hon. Friend agree that the effect of high interest rates on business is substantially mitigated because long-term rates are several points below the level of short-term rates? In addition, does he agree that the long-term interests of all business, the economy and the people of Britain are best served by having high interest rates now, rather than allowing problems to build up for the future, as other Governments would have allowed?
    Mr. Major: That is right. It is also pertinent that the profitability of small businesses is at the highest level for 20 years. That means that firms are much less reliant on borrowing and therefore much less sensitive to short-term interest rate changes.

    Economic Advisers
    Mr. Wall: To ask the Chancellor of the Exchequer if he will list his economic advisers at the Treasury.
    Mr. Gareth Wardell: To ask the Chancellor of the Exchequer if he will list his economic advisers at the Treasury.
    Mr. Major: I shall arrange for a list of the numbers in each grade to he published in the Official Report.
    Mr. Wall: Have the Chancellor's economic advisers concluded whether Sir Alan Walters, the Prime Minister's economic adviser, is correct in saying that the current high and rising rate of inflation is due to the Chancellor's decision to peg the pound to the deutschmark?
    Mr. Major: I understand why the hon. Gentleman is seeking to cause trouble, but I have no intention of accommodating him.
    Mr. Wardell: Have the Chancellor's advisers yet reached the conclusion that his over-reliance on the rate of interest as an instrument of economic policy is the key to understanding his current mismanagement of the British economy?
    Mr. Major: The Chancellor's advice from his advisers is for him. The decisions that are taken are for the Chancellor. I have no intention of referring to the advice that is received.
    Mr. Robert Banks: Will the Minister accept advice from me, that the current interest rates are biting quite well enough and that the Government's policy must be given
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    time before we take any other action that may or may not be necessary? It is essential that the economy is given proper time in which to respond to current levels.
    Mr. Major: As I said earlier, my right hon. Friend will certainly use monetary policy to bear down on inflation. I give my hon. Friend that categorical assurance.
    Mr. Batiste: Does my right hon. Friend agree that a sensible person should take advice from as many sources as possible, and that he will be judged not by the noises that come from his advisers but by the quality of the judgments that he makes based upon that advice?
    Mr. Major: My hon Friend makes an extremely good point. It is not that long ago that we had some advice from 364 distinguished economists who were entirely wrong. I can certainly offer my hon. Friend the assurance that none of them work for the Treasury.
    Mr. John Smith: Is it not clear that the Chancellor is in need of some good advice, in particular not to make foolish interventions in rail disputes and not to threaten even further cuts in investment in our railway system, which is already inadequate because of years of underinvestment by the Government?
    Mr. Major: Even by the standards of the Opposition Front Bench, that is a remarkably misguided statement. The growth in investment in British Rail has been 75 per cent., and we now have the largest investment programme in British Rail since the advent of steam. That is a reality that the right hon. and learned Gentleman and his hon. Friends might do well to understand.
    The following is the information:

    1 Chief Economic Adviser at Grade 1A

    1 Deputy Chief Economic Adviser at Grade 2

    4 Grade 3 (Under Secretary) Economists

    12 Grade 5 (Senior Economic Advisers)

    31 Grade 7 (Economic Advisers)

    27 Economic/Senior Economic Assistants

    Earnings
    Mr. Curry: To ask the Chancellor of the Exchequer what was the percentage increase in the real take-home pay of a married man on male average earnings with two children between 1978–79 and 1989–90
    Mr. Norman Lamont: Take-home pay for a married man with two children on average male earnings is 32 per cent. higher in real terms in 1989–90 than in 1978–79.
    Mr. Curry: Is it not clear that the ordinary working family has benefited most from a policy of high economic growth and a reduction in taxation? Therefore, are not the Government acting in the interests of the ordinary working family in making their counter-inflation strategy the centrepiece of their economic policy, even when it involves difficult decisions such as keeping down pay in the public sector?
    Mr. Lamont: My hon. Friend is right. The increase in earnings in real terms, after prices and after VAT, to the average person is worth about £53 a week more at today's prices than in 1978–79. The same is true also for the person on half average earnings. His real earnings are now about 25 per cent. higher. That is an increase in the past seven

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    years of 3·2 per cent. per annum, which compares with a total increase of about 4 per cent. during the period when the Labour party was in office.

    European Monetary System
    Mr. Malcolm Bruce: To ask the Chancellor of the Exchequer if he will make a statement on what deutschmark/sterling exchange rate he would treat as appropriate to join the exchange rate mechanism of the European monetary system and as to what other considerations would affect his decision.
    Mr. Lawson: I refer the hon. Member to the statement by the Prime Minister to the House on 29 June on the outcome of last week's European Council in Madrid.
    Mr. Bruce: That statement showed that the Prime Minister took the view that we should not join the exchange rate mechanism until the completion of the single market, which is likely to be well after 1992. Does that mean that business and industry must wait another 10 years before the time is right?
    Mr. Lawson: The hon. Gentleman will have to wait and see. My right hon. Friend reaffirmed our commitment to join the exchange rate mechanism of the EMS but said that first inflation would have to come down and that there would have to be satisfactory progress on other measures involved in stage one of the Delors programme, including in particular the abolition of exchange controls. We in this country have been working for that for a long time, and got an agreed directive last year.

  PRIME MINISTER

    Engagements
    Mr. Bill Walker: To ask the Prime Minister if she will list her official engagements for Thursday 6 July.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.
    Mr. Walker: Has my right hon. Friend read the report in the Scottish Sunday Express about the crisis of confidence throughout Scottish business— [HON. MEMBERS: "Reading."] and the risk of job losses and a reduction of investment in Scotland—[HON. MEMBERS: "Reading."]—which is the direct result of the Opposition and the Scottish media supporting the—[HON. MEMBERS: "Reading."]—flawed, fraudulent and unworkable proposals for an assembly or parliament in Scotland, leading to—[HON. MEMBERS: "Reading."]—increased risk of separation of the kind that we expect from the Socialists —[Interruption.]
    Mr. Speaker: Order. The hon. Member must make his question brief.
    Mr. Walker: Has my right hon. Friend realised that the benefits of the best financial climate that Scotland has enjoyed since 1945, due to her policies and leadership, is now at risk? What can she do to help the Scots?
    The Prime Minister: I saw the report to which my hon. Friend refers, which said that half the Scottish companies interviewed would either cut local investment or move their headquarters south if devolution or independence came to pass. Scotland has done well on inward investment and during the period of Conservative Government, more jobs have been created and it has the second highest rate of earnings in the whole of the United Kingdom. I hope that Scotland will see fit to keep this prosperity and good prospects for the future.
    Mr. Kinnock: Will the Prime Minister update the House on all the constructive efforts she has made since Tuesday to resolve the rail dispute?
    The Prime Minister: As I told the right hon. Gentleman, the rail dispute is a matter between the board of British Rail—[Interruption.]—and the unions. As he knows, the national tribunal is meeting today to hear and consider the matter referred to it by the Transport Salaried Staffs Association. Alas, it is not also considering the NUR and ASLEF issues because they have not referred their matter to that arbitration panel.
    Mr. Kinnock: I think that the words the Prime Minister was searching for when answering my question were, "None, Sir." If the Prime Minister ever used the railways or the tubes, she would know that travellers constantly suffer dirt, delays and discomfort because of under-investment. How does she think that yesterday's threat to cut investment will help to resolve the current dispute or help to improve services for those travellers?
    The Prime Minister: Has not the right hon. Gentleman forgotten one fundamental thing, which is that the unions are driving the customers away—[Interruption.]—because they are not operating the railways? The right hon. Gentleman will have heard the Chief Secretary in Treasury questions pointing out that investment in British Rail has increased under Conservative rule, particularly in the electrification of lines—the investment of the last two years is the biggest programme we have ever had and the prospects for the next four years are good. It is the unions which are driving their customers away, both passengers and freight. It is a tragedy that railway men will lose their jobs if they go on like this.
    Mr. Kinnock: There was not a single word of truth in the Prime Minister's answer. [Interruption.]
    Mr. Speaker: Order.
    Mr. Kinnock: Will the Prime Minister confirm, for the sake of honesty, that under her Government investment in railways has been 25 per cent. lower in real terms than under the last Labour Government, that the best level of investment ever achieved by her Government was lower than the worst level of investment ever achieved in real terms under a Labour Government, and that the claims made yesterday by the Chancellor of a 50 per cent. increase is an increase from the lowest level of investment in railways in post-war history?
    The Prime Minister: I do not know how the right hon. Gentleman can believe that people or freight can travel on railways—[Interruption.]—when the railways are on strike. Of course they cannot. Railway men are depriving themselves of jobs.

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    On the question of investment, the Government have spent in real terms half as much again each year on rail electrification as the Labour Government. With regard to overall investment, in terms of 1989–90 prices, the greatest years for investment in British Rail were 1987–88 at £594 million, 1988–89 at £629 million, and 1989–90 at £781 million.
    Mr. Barry Field: Does my right hon. Friend agree that even the average reader of "Thomas the Tank Engine" understands that it is not possible, on the one hand, to call on the Government to defeat inflation and, on the other to call on the Government to give in to the rail strikers' pay demands without stoking up inflation? Will my right hon. Friend recommend a serious economic policy to the Leader of the Opposition or send Mr. Controller to have a word with him?
    The Prime Minister: I agree with my hon. Friend that the Labour party will complain about the level of inflation and then support every strike to get increased wages.
    Mr. Kirkwood: To ask the Prime Minister if she will list her official engagements for Thursday 6 July.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Kirkwood: Has the Prime Minister yet had time to study the findings of the British Medical Association-commissioned Gallup poll on the National Health Service which shows that the vast majority of the British public, including many members of the Conservative party, are opposed to and will not accept the far-reaching structural changes to the NHS that the Prime Minister is suggesting in "Working for Patients" and in the new general practitioners' contract? Would it not be wiser to stand back and abandon the big bang approach to changing the NHS in favour of a much more considered evolutionary process which seeks to build on the very many strengths of the existing National Health Service?
    The Prime Minister: No. I never know whether we are being accused of not running a good enough Health Service so that it needs reform or whether we are being accused of running such a good Health Service that no reform is needed. Hon. Members ask for one course of action one day and ask a different question on another. We are running a very good Health Service—the best that we have ever had. We are hoping to improve it still further. Many of the improvements that we have introduced have been opposed at the time, but they have resulted in releasing increased resources for the patient and better patient care. This reform will be no exception. It will result in great improvements for the patient.
    Mrs. Peacock: To ask the Prime Minister if she will list her official engagements for Thursday 6 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mrs. Peacock: Has my right hon. Friend had an opportunity today to read the report in The Daily Telegraph which says that the Governor of the Bank of England feels very uncomfortable with the aggressive advertising techniques of the financial institutions? Does she agree that the use of aggressive advertising to persuade people to borrow money to spend is of grave concern?
    The Prime Minister: I am grateful to my hon. Friend. I tend to share the governor's concern and I dislike seeing so many temptations for people to spend more than they can really afford. I hope that they will resist such temptations. It is not wise to spend more than one can really afford.
    Mr. Foot: Can the right hon. Lady give us any explanation—maybe it must be a psychoanalytical one —of why she should always be at her most dogmatic or strident on subjects such as the railways, football or the National Health Service about which she knows least?
    The Prime Minister: Having been opposite the right hon. Gentleman for many years I would not say that he was the person who knew mostest about anything.
    Mr. French: To ask the Prime Minister if she will list her official engagements for Thursday 6 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. French: Will my right hon. Friend find time to consider the merits of the rents into mortgages scheme recently propounded by the Scottish Minister responsible for housing? Does she agree that such a scheme would find a welcome in other parts of the United Kingdom, including the south-west?
    The Prime Minister: Yes. I greatly welcome the rents into mortgages trial scheme that is being run in Scotland because there are a number of houses there where the Government are the landlord and we thought that it was a good way in which to try out such a scheme. I hope that many people will take advantage of it to purchase their houses and that the percentage of owner-occupation in that country will go up. Credit on housing is a very good investment indeed.
    Rev. Martin Smyth: Is the Prime Minister aware of the growing concern in Fermanagh about the recent decision to open the Lackie bridge, which has been closed for some time to protect the citizens there? At a time of growing bombing in the Province, will she provide the security that the people need?
    The Prime Minister: As the hon. Gentleman knows, there was a decision some time ago to close certain checkpoints because we thought that the soldiers involved at those checkpoints could be better deployed in the area to give greater protection to the people. That decision has now been implemented because we believe that it represents a better use of the armed forces for the protection of the people.
    Dr. Goodson-Wickes: To ask the Prime Minister if she will list her official engagements for Thursday 6 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Dr. Goodson-Wickes: Does my right hon. Friend agree that the recent accord between the MPLA and UNITA in Angola is a most welcome step towards peace in that country after a civil war that has lasted 14 years? Will she assure the House of the Government's persisting aim to achieve stability and prosperity in that region, not least by holding the next South African President to his pledge to hold to sensible progress towards democracy in his country?
    The Prime Minister: I join with my hon. Friend in hoping very much that the recent accord in Angola will be implemented and that it will lead to free elections. That will be the crucial test of whether it is working. If it is, that, together with independence for Namibia, will augur very well for the future of southern Africa. We have yet to see if that particular accord will result in free elections.
    Mr. Gareth Wardell: To ask the Prime Minister if she will list her official engagements for Thursday 6 July.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Wardell: What advice could the Prime Minister give to my constituents and hon. Members about elderly people who, without asessment of any kind, enter private nursing homes and then find that their families cannot afford to pick up the bill for the difference between what the DSS pays for keeping that person in the home and the price charged by the home?
    The Prime Minister: As the hon. Gentleman is aware, under the income support scheme, there is provision for people to enter private nursing homes. A maximum amount is payable and homes are available which fall within that amount so that people may enjoy those facilities. Of course, people should inquire about the price before they go in, and it is impossible for the DSS to pick up every single bill for every residential home, no matter
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    how expensive. That could not be done under any Government. There are more people in residential homes now than there have been for a long time. Therefore, more people are enjoying a standard of comfort which was previously not available to them.
    Mr. Thorne: To ask the Prime Minister if she will list her official engagements for Thursday 6 July.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Thorne: Will my right hon. Friend find time to consider the remarks made by Mr. Russell Hopkins, the general manager of University hospital of Wales, Cardiff when speaking at the BMA conference at Swansea? He accused the BMA of spreading fear, apprehension and uncertainty among the chronically sick, elderly and infirm through its disgraceful publicity campaign. Will my right hon. Friend denounce such behaviour?
    The Prime Minister: Yes, I am glad that some doctors and managers have the courage to speak out against the scare tactics which are frighening a number of patients totally unnecessarily. This year the Government have spent three times the amount of money that was spent 10 years ago. In our 10 years in power we have also increased the number of nurses and doctors. The reforms are intended to bring about even better patient care. When we put them into operation, they will do just that.

Business of the House
3.31 pm
Mr. Frank Dobson: May I ask the Leader of the House to state the business for next week?
The Lord President of the Council and Leader of the House of Commons (Mr. John Wakeham): The business for next week will be as follows:
MONDAY to JULY—Estimates day (3rd allotted day). There will be debates on Department of Energy administration and on civil aviation services. Details of the Estimates concerned and the relevant Select Committee reports will be given in the Official Report.
At Ten o'clock the Question will be put on all outstanding Estimates.
TUESDAY II JULY and WEDNESDAY I2 JULY Remaining stages of the Finance Bill.
At the end on Tuesday: motion on the Rate Support Grant (Scotland) Order, motion on the Redundant Mineworkers and Concessionary Coal (Payment Schemes) (Amendment) Order. At the end on Wednesday: motion to take note of EC document on irradiation of foodstuffs. Details will be given in the Official Report.
THURSDAY I3 JULY—There will be a debate on Hong Kong and China on a motion for the Adjournment of the House.
FRIDAY I4 JULY—There will be a debate on foreign affairs on a motion for the Adjournment of the House.
MONDAY I7 JULY—Opposition day. There will be a debate on an Opposition motion. Subject for debate to be announced.
[Monday 10 July
Estimate: Class VI, Vote 3 (Department of Energy: Administration)
Relevant Select Committee Report:
Energy Committee's Fourth Report Session 1988–89 (HC 435) on the Department of Energy's Spending Plans 1989–90
Estimate: Class VIII, Vote 2 (Department of Transport: Administration and Transport Services), so far as it relates to Civil Aviation Services.
Relevant Select Committee Reports:
Transport Committee's First Report Session 1988–89 (HC 198) on Air Traffic Control Safety
Transport Committee's Third Special Report Session 1988–89 ( HC 407), the Government Observations on the First Report of the Committee, Session 1988–89 Wednesday 12 July
Relevant European Community Document
10377/88 Irradiation of foodstuffs
Relevant Reports of European Legislation Committee
HC 15-viii (1988–89), para 5, HC 15-xvii (1988–89), para 5 and HC 15-xxi (1988–89), para 6.]
Mr. Dobson: I thank the Leader of the House for his statement and, on behalf of hon. Members from both sides of the House, I thank him for responding so promptly and arranging a debate on Hong Kong and China and a separate one on foreign affairs.
Can the right hon. Gentleman be equally prompt in securing a debate on the impact of the National Health Service review on Wales? The debate could be conducted
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in the House or he could persuade his right hon. Friend the Secretary of State for Wales to agree to a debate in the Welsh Grand Committee.
Has the right hon. Gentleman got any further in the discussions that he said he was having about the possibility of establishing a Select Committee on Scottish Affairs, or some alternative arrangements? It is some time since he told us that he was having those discussions and we should like to know the outcome.
When are we likely to receive the long-promised statement on the Government's response to the Griffiths report on community care? Will we receive it next week?
Finally, when will we get the long-promised debate on the Government's proposal to substitute student loans for student grants?
Mr. Wakeham: The hon. Gentleman asked me five questions about the business for next week. I am grateful for what he said about the two days that I have managed to find for the important debates on Hong Kong and China and on foreign affairs. I hope that it is for the convenience of the House to hold separate debates on those two subjects next week.
I recognise that we have had a number of debates on the Health Service; it is a subject to which we shall return from time to time, but I cannot promise a debate on the Health Service with particular reference to Wales. I know that my right hon. Friend the Secretary of State would welcome a debate on the subject in the Welsh Grand Committee, but its timing should be left to the usual channels.
I have nothing to add to what I told the hon. Gentleman some time ago about the Scottish Affairs Select Committee. I explained that I have been considering the points that some of his hon. Friends raised with me in the course of a useful discussion. I have to confirm that I do not see an easy solution, but I am still looking into the matter.
With regard to the Griffiths report, we are now finalising our proposals on community care and my right hon. and learned Friend the Secretary of State for Health very much hopes to be able to make a statement announcing our conclusions next week. As I have said before, there will be a debate in Government time at a suitable point thereafter.
As I said last week, my right hon. Friend the Secretary of State for Education and Science and I have made it clear that we would welcome a debate on top-up loans. Again, its timing is best left for discussion through the usual channels.
Mr. Tim Yeo: During Treasury questions today a Labour Front Bench spokesman expressed concern about an alleged increase in the burden of taxation during the past 10 years. Would my right hon. Friend consider it possible to provide enough time during the remaining stages of the Finance Bill next week for the Labour party to clarify its position on this issue? If its anxiety is genuine, it will presumably welcome further tax cuts introduced by the Government and abandon all the proposals contained in its recent policy document.
Mr. Wakeham: I have never felt that lack of time was the principal cause of the Opposition's not making their position clear. There will certainly be time for them to advance any arguments which they think relevant and in order in the debates that we have arranged for next week.
Mr. A. J. Beith: Why has a major Government review of tourism, which has been a year in preparation, been slipped out this afternoon by way of a written answer instead of in a statement to the House, after which hon. Members representing affected constituencies could question the Minister concerned, as was possible on the last occasion when the Government announced such a review? Are we to have an early debate on this? Why has this deplorable procedure been used in a case which arouses a great deal of interest throughout England?
Mr. Wakeham: I do not accept for a minute what the hon. Gentleman says. A written answer is a perfectly proper way of making an announcement. Of course, whether to make such an announcement by written answer or by oral statement is a matter of judgment that must take into account all the other pressures on the time of the House. My right hon. Friend gave the matter proper consideration, but I shall see to it that the hon. Gentleman's views are conveyed to him.
Mr. Robert McCrindle: Will there be time before the summer recess to debate the Monopolies and Mergers Commission report on the supply of beer? Although a number of my hon. Friends and I are opposed to the Commission's recommendations, we are not wholly in favour of the status quo. As there seems to be some doubt about the direction that Government policy is likely to take in response to the report, would it not be a good idea if my right hon. Friend sought the opinion of hon. Members on both sides of the Chamber?
Mr. Wakeham: At this stage, this is a matter for my right hon. and noble Friend the Secretary of State for Trade and Industry to consider. He is studying the report and considering the views expressed by hon. Members and others. It is right for him first to come to his conclusion, and for that conclusion to be announced; then we shall consider how best to proceed.
Mr. Jack Ashley: Is the Leader of the House aware that we should discuss the proposals of the Department of Transport for changing the orange badge parking scheme for disabled people? It should include thalidomide victims who have no arms and who have great difficulty carrying shopping. Other deserving groups should also be included. Abuse of the scheme must be ended because it damages the scheme, but is the right hon. Gentleman aware that more than 250,000 disabled people will lose their orange badges when the Minister's scheme is implemented? Hon. Members on both sides of the House will have thousands of complaints in the next year or two. Could we have a debate, please?
Mr. Wakeham: I am not sure that the right hon. Gentleman should be too alarmist about this matter. As he knows, the orange badge scheme was designed to help those with severe mobility problems. We are working to improve the scheme and to cut abuse for the sake of those who depend upon it for freedom of movement.
Mr. Ashley: I am not being alarmist.
Mr. Wakeham: It seems that the right hon. Gentleman, with his ingenuity, should be able to raise some of these issues in the debate that will take place tomorrow.
Sir Hal Miller: Knowing my right hon. Friend's personal and professional interest in our workings and in our working conditions, may I ask him whether he has received a copy of the parliamentary Labour party's proposals on this score? Will he consider providing an early opportunity for those of us who would like to join in the debate on the proposals, which include a three-day week—shades of 1974—provision for statutory instruments to be considered in Committee and various other measures that are apparently designed to secure not greater examination of the Executive but greater participation in our "pluralist political culture"?
Mr. Wakeham: I have not received a copy of the PLP's report, but I shall be interested to receive a copy. If it is as my hon. Friend has suggested, I am not sure that it will help us get up for the summer recess too quickly.
Mr. Alfred Morris: The Leader of the House will be aware of my interest, having legislated for the scheme, in the orange badge parking concessions for severely disabled people. Would it not be more satisfactory for there to be an oral statement next week about the very special predicaments of people with no arms, as my right hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) said, including many thalidomide victims?
Secondly, can I ask the Leader of the House if he can say any more about the timing of the forthcoming debate on parliamentary pensions?
Mr. Wakeham: The Minister who is responsible for the orange badge scheme and the question of thalidomide victims is consulting medical opinion on the circumstances of certain people with these unfortunate disabilities. Any statement or announcement to the House will be better made after conclusions have been arrived at.
The right hon. Member for Manchester, Wythenshawe (Mr. Morris) knows that I have been trying to find a time convenient to everyone for a debate on parliamentary pensions. I am most anxious that the debate should take place. As soon as I can make an announcement, I shall do so.
Mr. Ivor Stanbrook: Is my right hon. Friend aware that an industrial dispute which concerns and harms the interests of employers or employees only is one thing but that an industrial dispute that results in misery and suffering for thousands of members of the general public, who are unconnected with the merits of the dispute, is another? Can we have a debate on how we might alter the law to protect the public against irresponsibility by either side in an industrial dispute?
Mr. Wakeham: I fully recognise my hon. Friend's concern, the concern of his constituents and the concern of many of us who have constituents faced with circumstances similar to those that he describes. The public sector unions, especially in a monopoly or near-monopoly industry, should recognise their special responsibilities to the general public. Current strikes in public services are a disgraceful example of unions letting down the public, whom they are there to serve.
Mr. Bob Cryer: As the Parliamentary Under-Secretary of State for the Home Department has published and circulated a statement on blasphemy, would it not be a good idea to have a debate

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on the Law Commission's 1985 report, which recommended abolition of this antique, out-dated and wholly useless legislation, so that we could come to some conclusions about it? At the same time we could express strongly our opposition to and condemnation of the bombing of book-shops, one of which occurred recently where "The Satanic Verses" was on sale, albeit in a muted sort of way without any big campaign. The bombing of bookshops and attempts to suppress literature is redolent of Germany in the 1930s.
Mr. Wakeham: I agree that there would be considerable value in such a debate, as the House could express its grave concern and disquiet about some of the activities. As the hon. Gentleman well knows, the blasphemy laws have not been of much value or use in our system, so it certainly is not a sensible idea to extend them. The question whether they should be abolished is not for me, but they will not provide much of a solution to the current difficulties.
Mr. Michael Latham: Is my right hon. Friend aware that when the clergy ordination Measure comes before the House in the next two or three weeks, following an excellent debate in the House of Lords, many hon. Members will wish to take part in the debate? Will he ensure that the debate takes place at a reasonable time and is not shunted off to 4 o'clock in the morning?
Mr. Wakeham: There was a good debate in another place, and I hope that this House will live up to my hon. Friend's expectations. I shall try, as I always try, to bring important matters before the House at a convenient time. However, I am sure that my hon. Friend recognises that, especially at this time of year, I have some difficulty in achieving that objective.
Mr. Ray Powell: Will the right hon. Gentleman explain his reply to my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) about a Welsh Grand Committee debate on the National Health Service? Does he recall that during business questions on 22 June he promised my hon. Friend the Member for Cardiff, South arid Penarth (Mr. Michael) that he would arrange a debate on that matter before the recess? There are only three weeks to go and this matter is very important. It is essential that Welsh Members discuss the NHS as it affects Wales and also the proposals for Wales.
Is the right hon. Gentleman aware that the British Medical Association met in Swansea this week? We want to discuss with the Secretary of State the BMA's declaration against the Government's policy. It is not true to say that the matter can be negotiated through the usual channels because the usual channels are blocked. The right hon. Gentleman usually keeps his promises. Will he keep this promise and arrange a Welsh Grand Committee meeting so that we can fully discuss the problems with the Secretary of State?
Mr. Wakeham: I am not sure that my recollection of business questions on 22 June is the same as that of the hon. Gentleman. I am happy for the matter to be discussed through the usual channels. I have more confidence in that system than the hon. Gentleman appears to have at present.
Mr. Alistair Burt: In view of Britain's success in creating jobs during the past three years, does
476
my right hon. Friend agree that rather than the European Community giving us a social charter, there is an argument for Britain giving it a jobs charter? Will he find time, as soon as possible, for a debate on the employment aspects of the social charter proposed by the European Commission, so that the attitudes of the two sides of the House towards job creation can be examined, especially in respect of the damage done to employment by strikes in the public sector?
Mr. Wakeham: I agree that the Government's record on creating jobs is something to which all other countries in Europe could look with a degree of envy. It would make a suitable subject for debate, but I cannot promise one in the immediate future.
Mr. Bill Michie: I draw the right hon. Gentleman's attention to early-day motion 1018, relating to the dispute at Ever-Sure Textiles Limited, Sheffield.
[That this House deplores the action of management at Ever-Sure Textiles Limited, Sheffield, in refusing to accept recognition of the Transport and General Workers Union, even though 160 out of the 180 members of the workforce voted by ballot for trade union recognition and 87 per cent. of the workers voted in favour of industrial action following management's decision; condemns the dismissal of about 28 warehouse staff for taking part in the industrial action; is shocked to learn that the honourable Member for Sheffield, Hallam lists in the registry of Members' Interests that he is a director of this company where some of the women machinists have a basic wage of £61 per week; and calls upon him to put pressure on his fellow directors to allow the rights of workers for official trade union representation, which was confirmed in a democratic ballot.]
It has attracted 61 signatures to date.
Although it may appear to be just a local problem, is the right hon. Gentleman aware that the workers involved have gone through the democratic rules laid down by the Government to obtain trade union recognition, but have been ignored by the reactionary management of that company? As I was not successful in obtaining an Adjournment debate, will the right hon. Gentleman consider arranging a short debate so that we can express our concern and gain some information about the Government's stance on this matter?
Mr. Wakeham: The hon. Gentleman will know that at this time of the year there are a number of occasions on which he can raise that matter on the Floor of the House without my having to find time for a debate, which I am sure he will recognise is difficult as we approach the summer recess. It is for companies to decide on their bargaining systems, including which union, if any, they wish to negotiate with in collective bargaining.
Mr. Michael Jack: My right hon. Friend will have heard the exchanges during Prime Minister's Question Time on the subject of railway investment, when the Leader of the Opposition seemed to doubt the validity of some of the answers that he was given. The Government have a proud record on railway investment and I am continually being lobbied by my constituents and other bodies urging that the Government should do more on that subject. Our investment has been linked to the performance of British Rail and its staff but now that performance is sadly lacking. Will my right hon. Friend

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consider having a debate on railway investment so that we can put straight our record on that matter and learn exactly what are the Opposition's criteria? Perhaps they would invest with no performance at all.
Mr. Wakeham: That would make a good subject for a debate. At Prime Minister's Question Time, the Leader of the Opposition, as is his right, asked questions and my right hon. Friend gave him answers. I hope that he is a wiser man as a result. However, I cannot promise an early debate on the matter raised by my hon. Friend.
Mr. Paul Boateng: Will the Leader of the House find time next week for the Home Secretary to come to the House and make a statement on the Home Office report published this week on the future of section 11 funding of local authorities and the Home Office's continued failure to make up its mind on whether to give relief to my hard-pressed ratepayers by paying out the money due to the borough of Brent under section II, as recommended by Sir David Lane?
Mr. Wakeham: If my right hon. Friend the Home Secretary wants to make a statement to the House I shall certainly find time, but the hon. Gentleman can find a way of raising that matter in the House without my assistance. However, I shall refer to my right hon. Friend the point that he has made.
Mr. Bowen Wells: Will my right hon. Friend make it clear that despite Thursday's debate being on a motion for the Adjournment of the House, the subject will be Hong Kong and China, not other foreign affairs matters, and that any other foreign affairs matters that hon. Members wish to raise will be debated on Friday?
Secondly, when does my right hon. Friend expect to respond to the recommendation of the Select Committee on European Legislation and the Select Committee on the Treasury and Civil Service that the House should debate the Delors report?
Mr. Wakeham: I do not have anything further to say on the latter point, but we shall bear it in mind. The Delors report is an appropriate subject for debate and no doubt there will be an opportunity to debate it in the House.
On the foreign affairs debate and the debate on Hong Kong and China, my hon. Friend is correct. I announced Thursday's debate on Hong Kong and China, and Friday's debate is a more general foreign affairs debate. What is or is not in order in those debates is not a matter for me.
Mr. Dennis Canavan: In view of the Government's continuing failure to set up a Scottish parliament or even a Scottish Select Committee, will the Leader of the House consider going up to Inverness tomorrow to observe the work of the Scottish Constitutional Convention, which he will see at first hand is much more representative of Scottish opinion than the House, which continues to ignore the democratic wishes of the majority of the Scottish people?
Mr. Wakeham: Unfortunately, my duties in the House will detain me here tomorrow, but if I had an opportunity
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to go to Inverness which, from time to time, I enjoy very much, I am not sure that going to the convention would be the most profitable thing to do.
Mr. Kenneth Hind: Will my right hon. Friend find time in next week's parliamentary agenda to debate industrial relations in the light of the strikes on trains and buses, and the prospect of a strike in the docks, so that the Labour party can explain to the public through the means of the House how it would end those strikes, particularly bearing in mind that during yesterday's debate on training, the Opposition Front Bench spokesmen said not one word on their policy on that subject either.
Mr. Wakeham: As my hon. Friend will have noted, I have announced an Opposition day debate for Monday 17 July, which is as far in advance as I can manage, to give the Opposition as much time as possible to get a policy together. If the Opposition want to debate that policy, I am sure that the House will be interested to listen.
Mr. Max Madden: What will the Leader of the House do to enable right hon. and hon. Members in all parts of the House to answer the growing list of questions from constituents about the implementation of the poll tax? Is the right hon. Gentleman aware that the latest estimate by Bradford city council officials is that the poll tax will be £343 per person—which represents a massive increase under that Conservative-controlled authority? Is the right hon. Gentleman aware that many people who have been designated as the "responsible person" have no income and are desperately worried about how they will pay? Is he aware that the parents of children aged over 18 in secondary education, with no income of their own, will be liable for their children's poll tax, and that people absent from the United Kingdom for up to one year will also be liable? When will right hon. and hon. Members have an opportunity to put questions to the Secretary of State for the Environment, in the hope that he will give some sensible replies?
Mr. Wakeham: If the hon. Gentleman continues asking questions of such an alarmist nature, it is no wonder that some people in Bradford will be misled as to the true position. I am unaware of any major problems that remain unresolved, but if the hon. Gentleman will write to me, I shall do my best to answer him.
Mr. Harry Greenway: I support the call of my hon. Friend the Member for Orpington (Mr. Stanbrook) for a statement or early debate on the British Rail and London Underground strikes. They are causing desperate inconvenience and suffering to my constituents and those of other right hon. and hon. Members—including pensioners from Northolt, who seek to take their holidays from Wednesday to Wednesday to save money. Such a debate could also consider the suggestion that many pensioners have made to me, which is that the men and women who work on the railways are losing nothing from their pay packets by striking on Wednesdays, because they make up their income by working overtime on the Tuesdays before and the Thursdays after the strikes —so they make no real effort or sacrifice.
Mr. Wakeham: I fully understand my hon. Friend's concern about the grave inconvenience caused to many of his constituents and about the strike generally. The strike is for British Rail and the unions to resolve, and I hope

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that they will do so quickly in the interests of all commuters. The Government have done what they can to assist commuters to get to work. The extra measures that we announced last week were generally a success. Emergency parking in central London was well used, without creating significant extra congestion, and we are considering the use of further park-and-ride sites.
We urge the public to use car-sharing more and to stagger their journeys, so that more people may get to work. By far the most satisfactory way out will be for the union to recognise its responsibilities and to reach agreement with the employers.
Mr. Frank Cook: I draw the attention of the Leader of the House to early-day motions 1080 and 1081, in the name of the hon. Member for Langbaurgh (Mr. Holt).
[That this House congratulates the BBC's staff for their courageous action in striking.
That this House notes that there is no intention on the part of the BBC strikers to improve productivity or efficiency and that the action taken has hit hardest at the elderly, house bound, lonely and low paid who struggle to pay the present exorbitant licence fee.]
Will the right hon. Gentleman arrange for a debate—short or otherwise—on both early-day motions, which may allow the hon. Member for Langbaurgh to explain his somewhat contradictory views, which clearly must have been tendered in the spirit of mockery? Such a debate would allow right hon. and hon. Members to express their undistorted views about the opinions of BBC staff, as opposed to those of BBC management. It would also provide an opportunity to pass comment on the summer of discontent that the Government have undoubtedly provoked in a desperate quest to regain some form of electoral advantage.
Mr. Wakeham: That is not a particularly helpful comment. Industrial relations between the BBC and its employees on various subjects, including pay and conditions, is a matter for the BBC. It is for the BBC to decide how best to use the resources available to it, within the constraints of the index-linked licence fee. The Government's concern is to take measures to bear down on inflation, which is the major problem that we must overcome.
Mr. Spencer Batiste: My right hon. Friend will recall that I have asked several times whether he will find time for a debate on the Lord Chancellor's proposals for the reform of the legal profession before the Government's response to the many recommendations that they have received has crystallised. Can my right hon. Friend say when a White Paper on this important subject is likely to be published and whether he will find time for a debate before that happens?
Mr. Wakeham: My hon. Friend has been very patient and has asked me a number of times to find time for a debate. I regret that I have not been able to do so. Ministers hope to take decisions before the summer recess. I am sure that we will return to these matters at an appropriate time.
Mr. Greville Janner: I add my plea to that of the hon. Member for Elmet (Mr. Batiste). Surely it is wrong that proposals of this magnitude, affecting people's rights in law, are debated throughout the country
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and decisions are made, but there is no debate in the House. Is not the position even worse, because in the meantime, people's rights to justice deteriorate as the legal aid system provides less support. A person who needs justice must be either very rich or have little money—otherwise, too often, the courts are not available. Surely we must have a debate on legal reform and legal aid before the recess. Can the right hon. Gentleman promise at least that?
Mr. Wakeham: I regret that I cannot. The hon. and learned Gentleman is a fair man and he would be the first to agree that record amounts of money are being spent by the Government on legal aid. Of course, these are matters for debate, but that point should not be overlooked.
The Government have issued a Green Paper for discussion of the procedures. A final decision has not been made. When the Government decide what to do, there will be ample time to discuss the matter. If it involves legislative proposals, the House will have a full opportunity to discuss, debate and decide the issues.
Mr. Barry Field: My right hon. Friend was not able to announce a subject for the Opposition day debate on Monday week. Given the comments of the hon. Member for Sheffield, Heeley (Mr. Michie) on the dispute at Ever-Sure and given the unwarranted and unprovoked attacks on the integrity of my hon. Friend the Member for Sheffield, Hallam (Mr. Patnick), will my right hon. Friend confirm that, if the hon. Member for Holborn and St. Pancras (Mr. Dobson) requests an Opposition day debate on the dispute, he will agree to it? Does my right hon. Friend agree that if the Opposition do not request that debate, it will mean that they are simply indulging in petty political point scoring?
Mr. Wakeham: It is for the Opposition to decide the subject for debate on that day. If they want to debate that issue, they are entitled to do so. I recognise the force of my hon. Friend's comments. We can draw our own conclusions from the Opposition's actions.
Mr. Martyn Jones: I refer the Leader of the House to the Official Report of 22 June, when he promised my hon. Friend the Member for Cardiff, South and Penarth (Mr. Michael) that he would do his best to have a Welsh Grand Committee before the end of the Session. Is the right hon. Gentleman aware that we gave two weeks' and three weeks' notice respectively through the usual channels and neither date was acceptable to the Secretary of State for Wales? I suspect that if the Secretary of State were as keen to discuss the Health Service as he claims, he would have found time to debate that matter in the House. I suggest that that notice is sufficient. I ask the Leader of the House to do better than his best and to prevail on the Secretary of State for Wales to overcome his natural fear to discuss a subject such as the Health Service in Wales and have a debate before the end of the Session.
Mr. Wakeham: I am grateful to the hon. Gentleman for confirming that what I said in that debate was not as his hon. Friend the Member for Ogmore (Mr. Powell) suggested. I said that I would do my best. I will have discussions though the usual channels and I never do less than my best in these matters.
Mr. Alan W. Williams: I add my comments to those of my hon. Friends the Members for Clwyd, South-West (Mr. Jones) and for Ogmore (Mr. Powell). There is serious concern all over Wales about the future of the Health Service and the Government's review proposals. The subject has produced a large mail bag for me and all other Welsh Members. I was heavily involved in the by-elections earlier this year in Pontypridd and Vale of Glamorgan and I know that the Health Service is the main issue in politics today for thousands of people. We should have an opportunity in the Welsh Grand Committee to discuss the effect of the proposals on Wales. We normally have four Committee sittings a year, but this year we have had only three. Why do the Secretary of State for Wales and the Government not allow us the opportunity to discuss the Health Service in the Welsh Grand Committee?
Mr. Wakeham: I am surprised that the hon. Gentleman has reminded the House of his activities in the by-elections. I thought that he would hope that we would forget all about them. I recognise that he has added his voice to those of his hon. Friends wanting a debate on the Health Service in Wales. The Government's record on Wales and the Health Service would make a suitable subject for debate, but such matters must be negotiated through the usual channels, as I have said that I will seek to do. I cannot make a firm promise.
Mr. Frank Haynes: Will the Leader of the House do me a favour? Will he grab hold of his right hon. Friend the Secretary of State for Energy, in between his flying in and out of Heathrow—which he does too often— and have a word with him on coming to the House and making a statement about a pit closure in my constituency? Everything has been agreed, so there is no problem about that. However, British Coal wants to use the land for housing development, whereas the people of the area want jobs. There is nothing else. I do not want the Leader of the House to tell me that he will have a word with his right hon. Friend because I have already done
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that. Let us have the Secretary of State here and let me have the opportunity to question him to see what help he will give my constituents on this problem.
Mr. Wakeham: If the hon. Gentleman has tried his persuasive best, I do not think that there is much more I can do to assist. I know my limitations.
Mr. Max Madden: On a point of order, Mr. Speaker. I am sorry to raise this point of order, but the matter is most important. You called during business questions the hon. Member for Isle of Wight (Mr. Field) who, for reasons best known to himself, referred to the hon. Member for Sheffield, Hallam (Mr. Patnick) and to the comments made earlier by my hon. Friend the Member for Sheffield, Heeley (Mr. Michie). I am sure that you will recollect that my hon. Friend the Member for Heeley made no comment about the hon. Member for Hallam. I am sure that you will also confirm that the early-day motion concerning Ever-Sure Textiles Limited and the dispute of members of the Transport and General Workers Union seeking union recognition refers to the hon. Member for Hallam. However, it must have been entirely in order for those references to be made as they have been accepted by the Table Office and, indirectly, yourself. I hope, therefore, that you will make it clear that the comments of my hon. Friend the Member for Heeley and the early-day motion did not constitute an unprovoked attack on the integrity of the hon. Member for Hallam, which was what the hon. Member for Isle of Wight claimed. I hope that you will be able to clarify the record.
Mr. Speaker: If the comments of the hon. Member for Sheffield, Heeley (Mr. Michie) had been out of order, I would have stopped him. However, they were not and I cannot say more than that.

STATUTORY INSTRUMENTS, &c.
Ordered,
That the draft Passenger and Goods Vehicles (Recording Equipment) Regulations 1989 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Dorrell]

ESTIMATES DAY
ESTIMATES 1989–90
  Class XI, Vote 3
  [Relevant documents: First Report from the Home Affairs Committee of Session 1988–89 on the Forensic Science Service (House of Commons Paper No. 26), the Government Reply thereto (Cm. 699), the Third Report of Session 1988–89 on Higher Police Training and the Police Staff College ( House of Commons Paper No. 110) and the Fourth Report of Session 1988–89 on Home Office Expenditure (House of Commons Paper No. 314), so far as it relates to common police services.]—[Mr. Douglas Hogg.]
  Class XI, Vote 3

Common Police Services
Motion made, and Question proposed,
That a further sum, not exceeding £259,162,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges which will come in course of payment during the year ending on 31st March 1990 for expenditure by the Home Office on court services, other services related to crime, probation and after-care, police, fire, civil defence, control of immigration and nationality, issue of passports, etc., other protective and community services, certain broadcasting services, data protection and other miscellaneous services including grants in aid and international subscriptions; and on administration (excluding prisons).
4.9 pm
Mr. John Wheeler: I welcome this opportunity to introduce a debate on common police services and, in so doing, to discuss three of the reports of my Select Committee on Home Affairs this Session. My Committee has reported on the forensic science service and the police staff college, both of which are paid for from the common police services fund and has devoted part of our report on Home Office expenditure to common police services.
The common police services fund is used as a means of paying for those centrally organised police activities which individual forces could not finance on their own. These services so funded have been described as the infrastructure of the police service. Under the provisions of the Police Act 1964, the Secretary of State is empowered to contribute to these services as a means of promoting the efficiency of the police. Although small in monetary terms and in relation to overall expenditure on the police, common police services currently include a variety of activities essential to the effectiveness of the police service as a whole.
Because the police service is based upon a tripartite structure dating from Victorian times, it is difficult, if not impossible, for the Government to introduce new techniques in policing or to achieve standard practice across all 43 police forces in England and Wales. It has been a feature of all three of our Committee reports that we have proposed ways of creating greater unity of purpose and common approaches to policing, without which the present police structure might fail to meet the needs of the 1990s.
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Our first report, made in February of this year, was on the forensic science service. The Committee discovered that the service has been under-funded. Its resources had not increased in line with the increasing volume of recorded crime and the enhanced capacity of the laboratories for forensic analysis. The shortfall in funding had led to the demoralisation of staff and general dissatisfaction with the services provided by forensic science laboratories to individual police forces.
The under-funding was the more serious, in the view of the Committee, because we had evidence that in particular cases the use of forensic science could lead to great savings in police resources by quickly confirming the guilt or establishing the innocence of a subject. Forensic science analysis can have a direct bearing on the use of expensive police resources by enabling them to be better directed. Moreover, we also had evidence that, in some cases giving rise to major public anxiety, forensic analysis has contributed to a speedy solution of the crime and the allaying of much disquiet.
The usefulness of forensic science is nowhere more clearly demonstrated than in the development of the DNA profiling test, which will match the DNA structure of a person to any blood, hair or other body fluids left at the scene of a crime. Because of the unique structure of each individual's DNA and the increasingly sophisticated and accurate results obtained from such tests, we made a special recommendation that pending the establishment of a register of DNA profiles or "fingerprints", for which the technology is not yet available, records of all those convicted of appropriate offences should be retained for future reference.
To overcome the problem of under-funding, we proposed that the laboratories should institute a system of charging police forces for work done. The evident value of forensic analysis to police inquiries in our view would ensure adequate funding. In any event, we proposed additional safeguards to ensure that the service should not be run down for short-sighted and short-term budgetary reasons.
The Home Office has reacted positively to our report. Under the new director general, it is proposed that the forensic science service will expand to meet the currently unmet demand for forensic science. I hope that my hon. Friend the Minister will be able to inform the House that the essential short-term increases in staffing have now been agreed by the Treasury. Our proposal that individual forces should take direct financial responsibility for the work done by the forensic science service has also been accepted in principle and a detailed study is to be made into the feasibility of establishing the service as an executive agency. We welcome these steps, but wish to be reassured that the implementation of the practice of charging is not being held up by the failure to obtain the agreement of the Association of Chief Police Officers.
Our third report of this Session was on higher police training and the police staff college. Following our earlier inquiries, we were convinced that a key factor in making the fragmented police structure work was an efficient and coherent system of higher police training. Given the enormous cost of the police service in England and Wales —£3·7 billion in the current year, with 122,000 police officers and 40,000 civilian staff and a variety of other expensive resources—it is vital that senior officers are trained to maximise the use of those resources and manage them effectively to the benefit of the whole police service.

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We were most impressed by the police staff college at Bramshill. Under the leadership of the present commandant, Mr. Bunyard, it has improved its command courses in terms of quality and content so as to equip those in command at all levels to fulfil their responsibilities. Because we recognise the importance of the skills and qualities available at the police staff college, we propose that its resouces should be used more widely in police management consultancy, in the research enterprise and as a venue for seminars and conferences.
From our visits to the college and the evidence we received, it became clear that the location of the college at Bramshill was an essential ingredient of its success. Bramshill house has become a symbol throughout the world of all that is best in the British police tradition. Sadly, Bramshill house is in a poor state of repair and will need urgent expenditure if it is to be preserved, but I believe that the investment that has already been made in the current site makes it inconceivable that the college should move. I would ask my hon. Friend the Minister if he is yet in a position to commit the Home Office to the future of Bramshill house as the venue of the police staff college and to the investment which this will require.
If the excellent training provided at Bramshill is to contribute fully towards a more effectively managed police service, it must be accompanied by appropriate arrangements for recruitment, career development and appointment to senior police posts. Sadly, at present, such arrangements appear to be lacking. We found that the special course, which provides an avenue for accelerated promotion for the most able young officers, has been seriously under-subscribed.
We do not believe that this under-subscription derives from the current method for selection of candidates for the special course and the senior command course by extended interview procedure, which we strongly support. Rather, it appears to follow from difficulties in the recruitment process and in the career development process within forces. It was suggested by Mr. Roger Birch, chief constable of Sussex and director of police extended interviews, that some smaller forces lacked the capacity to select the future leaders of the service.
As a solution to this perceived difficulty, we recommend that the Home Office should investigate the establishment of a professional method of nationally directed and regionally organised recruitment into the police service of England and Wales. To ensure that the most able young officers are motivated to attend the special course, we further recommend that the special course should include a greater element of assessment so that it becomes the principal means for identifying the future leaders and senior officers of the service.
Similar difficulties were also apparent in the case of the senior command course. The Committee was deeply disturbed to learn of the number of officers at ACPO rank who had not attended the senior command course, including 47 per cent. of all assistant chief constables. In addition, a considerable number of those who, after vigorous selection procedures, undertake the senior command course, fail to go on to achieve assistant chief constable rank. This represents an appalling waste of training on the one hand, and a lack of professional training for those in post on the other. The Committee
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recommends the adoption of a policy whereby, from 1993 onwards, attendance on the senior command course should be a compulsory requirement for all officers applying for posts at the ranks of chief constable and deputy chief constable and Metropolitan and City of London police equivalent rank.
We were also greatly concerned about the wider matter of career development at ACPO rank—in other words, how the leaders of the police service are chosen. The current system of appointment was described by Mr. Birch as an "unprofessional lottery". There is little or no scope for career planning in these grades, and there is a positive disincentive to secondment to undertake essential central service jobs. This must be changed if senior officers are to be given similar opportunities to civil servants to broaden their experience and to deepen their professional knowledge.
The Committee came to the conclusion that the current method of appointment to and within ACPO rank is haphazard and amateurish in the extreme. To overcome the problem for this small career group, which comprises 249 posts, of which 63 are in the Metropolitan police, our report recommends that the ACPO ranks of the police service should be established as a central service grade within the Home Office as a cadre of professional officers holding the historic rank of constable, but available for appointment to the developing tasks of a modern police service both in central services posts and in existing constabularies.
In addition to the nine ACPO rank central service posts, there are currently 600 officers on central service duties within the police service—a number almost equivalent to a smaller police force. The growing importance of such posts is evident from the passage of the Police Officers (Central Services) Act 1989, which received Royal Assent only this week, and which granted to officers on such duties the historic office of constable.
A common thread in our reports on the forensic science service and higher police training is that the Home Office has found it difficult to determine the amount of resources to be devoted to services funded initially by the Home Office, partially paid for by local authorities and used by forces directed by chief constables.
We have therefore proposed in our report on Home Office expenditure that the Home Office should take full financial charge of those services necessarily provided centrally and recommend that, from the financial year 1991–92, the Home Office should pay the full cost of these services and that an appropriate adjustment should be made in the police or rate support grant to leave central and local government contributions to police expenditure in the same proportion as in the current financial year. Such a change would give those responsible for the services a direct incentive to maximise their efficiency and proper use.
In our report on Home Office expenditure, we review three other areas of police activity falling on common police services. For example, we examine the proposal that the secretariat of the Association of Chief Police Officers, should be strengthened. ACPO is increasingly looked to by the Home Office for advice and, in the case of the mutual aid co-ordination centre, it undertakes a quasi-executive role.
We therefore support the enhancement of ACPO's secretariat, provided that it is accompanied by a fundamental examination of the association's statutory

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responsibility and accountability. Until the questions concerning the current organisation of the police are resolved, it appears that ACPO is to be the unifying factor in the present fragmented police structure. It is important, therefore, that this is acknowledged and its accountability established.
Our Committee has also been concerned at the limited expenditure on police recruitment, in view of the looming demographic problem which will occur as the pool of young people diminishes in the 1990s. We have therefore proposed that the Home Office and the Police Advisory Board give urgent consideration to an advertising campaign to market the police service as an attractive career to the ablest young people in the future. We re-emphasise the importance of a recommendation in our report on higher police training that there should be national direction of recruitment policy and procedures. These should be directly funded by the Home Office.
The Committee welcomed the appointment by the Home Office of a professional procurement adviser to assist police forces to secure the benefits of bulk purchase of vehicles, while maintaining the freedom of individual forces to procure vehicles best suited to their operational needs and budgetary considerations. We conclude that the Home Office should play an active role in ensuring that all forces achieve the most efficient standards in the purchase and management of vehicle fleets. Our recommendation fits in well with a recent report of the Audit Commission which clearly demonstrated the scope for financial savings. I hope that the Minister will say what progress has been made in this sphere.
I conclude with a few words about the essential provision of central services for the police. My views on the inadequacy of a system with 43 independent police forces in England and Wales are well known. Indeed, there are eight more forces in Scotland and a considerable number of departmental police forces, such as the British Transport police force, the Royal Parks constabulary, the Ministry of Defence police and so on. One means of making this system work is to ensure that services which are vital to successful police work, but which are beyond the scope of individual forces to provide, should be provided centrally.
The current method of provision is through common police services. This arrangement fudges responsibility and obscures accountability between Government, local authorities and chief constables. We have proposed that the Home Office should be free to take decisions on such matters without requiring to justify them in financial terms to local authorities, many of which have varied and possibly conflicting priorities.
No example of a matter in which a speedy decision is required is more important than that relating to the greater co-ordination of the regional crime squads for the whole of England and Wales, which has been suggested in our current inquiry into drug trafficking. If Government are to take decisive action in the provision of a vital national service such as this, they must be able to ensure that it is provided on a scale and at a speed which meets the urgency of the problem. This, above all, is the justification for the change we have proposed in the funding of the common police services.
This is an important debate, in which I hope other members of the Committee and hon. Members will find the opportunity to contribute. I very much look forward to the reply of my hon. Friend the Under-Secretary to my
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comments on the work of the Select Committee and the proposals that we make for the improvement of the police system in England and Wales.
4.30 pm
Mr. Tony Worthington: I am pleased to speak immediately after the hon. Member for Westminster, North (Mr. Wheeler), under whose chairmanship the Select Committee on Home Affairs has put together a series of valuable reports, which I hope will guide the work of the Home Office.
I shall restrict my comments to the forensic science report, although I am sure that other hon. Members will cover the wide range of other reports. It is especially important to put the spotlight on the forensic science service, because we produced a report which was highly critical of the way in which forensic science has been administered in recent years. Although the Government's response to the forensic science report seems to accept many of our points, I hope that the Minister will be able to flesh out that response to show us that the Government genuinely recognise that there have been some wrong turnings in recent years and that we need to make it clear, not just with words but with deeds, that the forensic science service is now esteemed and is moving forward.
When we examined the service, we found a disturbing scene. Our reports are written in very modest and moderate terms, but in this report we said that the service had fallen on hard times and that morale was at rock bottom. Those are harsh words, but I believe that it was the unanimous view of the Committee that they were justified, and that radical improvement was needed.
Basically, we thought that the fault lay with the failure of the Home Office and its Ministers to understand the function of the forensic science service. It might be that the forensic science service failed to persuade the Treasury that it had problems, but the fault must remain with the Home Office having inadequate persuasive powers. In recent years there has not been any lack of concern in terms of the number of investigations of the forensic science service, but the situation has been one of paralysis by analysis. No sooner had one group come along to examine the forensic science service than another one came along. We were fearful that we would be yet another burden on that service, in that we might also be the cause of some delay.
We found it disturbing that the reviews, such as the Chepstow review, seemed fundamentally to misunderstand what the forensic science service involved. While Lord Rayner might be highly effective within Marks and Spencer, his impact on the forensic science service has been nothing short of disastrous. It is necessary to understand the contribution of the forensic scientist in other than accounting and administration terms. It takes many years to produce a good forensic scientist. Not only is there a prolonged stage of initial training, involving a first and usually a second degree in the person's own specialism, but there is then a long period of work to develop the skills needed to be fully valuable to the forensic science service.
The competent forensic scientist undergoes a unique test when the most adept and agile legal brains of the country subject every aspect of his work to intense investigation. Not many people face such a test.
In recent years there has been a lack of effective leadership in the forensic science service, but more

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particularly a lack of leadership from the Home Office. We found that morale was low within the service, and that that had been exacerbated by its pay and conditions.
One of the things that most disturbed me was the way in which vacancies are filled. That is done by the Civil Service Commission and I believe that if one wants to lower morale in any service one need only bring in that commission. Someone may apply for a job and hear only many months later that he has got it. What is also disturbing is the lack of involvement of regional directors in appointments. When there are vacancies in a forensic science laboratory a person turns up at the door many moons after the need for an appointment was realised. Such practice is not the way to build up the balance and the quality of service available within a forensic science laboratory.
In the report we urge that the regional laboratories should be involved in choosing those to be appointed as forensic scientists. I hope that that recommendation is accepted. We also urge that vacant posts should be filled more rapidly.
Discontent about appointments is also linked to discontent about pay and conditions within the forensic science service. In the south-east the service has been unable to compete effectively for scarce resources. Forensic scientists have not only seen their salaries fall in comparison to those earned by scientists in the outside world, but they are extremely mortified when they discover that they are paid less than the police constable working on the same case. That must be put right. Following the Rayner review, cuts were imposed which resulted in the worst of all worlds—numbers in the service were reduced at the same time as those remaining in the service realised that others in the law and order business were valued higher than they.
We are faced with a strange situation. We have a law and order Government who have put great stock on the need to bring crime under control. They have recognised that the number of police should be increased, but they have not recognised that the forensic science service, which is a valuable tool for the police, should also have its numbers increased. It has, instead, been subject to cuts. In recent years the forensic science service has not expanded as it should and, therefore, morale has collapsed. Such a collapse is not inevitable. In our valuable visits we also saw the Metropolitan police and the Strathclyde police forensic science laboratories and neither of those places offers the same chronicle of collapsing morale and lack of contact with the management.
It is worth pointing out that the reductions in the forensic science service, run by the Home Office, have occurred alongside two other important events. The first is the massive expansion in the crime rate since the Government came to office. If the service is not expanded, inevitably there will be a diminution in the contribution that the forensic science service can make to the cause. It also emerged that more and more sophisticated techniques, developed by the forensic science service and others, could be applied to crime. Those techniques tend to be expensive in terms of labour and equipment. There was a consciousness of what could be done in relation to forensic science and a realisation that not all that could be done was being done. The most dramatic and
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sophisticated of those techniques is the development of the DNA service. However, that is merely the most glamorous of the developments that have occurred in forensic science.
What issues face the forensic science service at present? I disagree with the rest of the Committee on the issue of charging. At present, as the hon. Member for Westminster, North said, the forensic science service is funded from the common police services budget. The majority of the Committee suggested that in future, the forensic science service should, at least in part, be supplied to individual forces on a piece rate basis. If forces asked for a particular job to be done, they would be charged for it on a piece rate basis.
I disagree with that suggestion because it seems that the central reason for embracing that method of funding is that those involved will do anything to escape the Home Office clutches. It was interesting that the Metropolitan police and the Strathclyde forensic science laboratories made no request for a charging service. Somewhat surprisingly, the trade unionists were in favour of charging, and when I asked them whether that was because the system would enable them to elude the Home Office's clutches, they as good as admitted that that was a factor.
Mr. Wheeler: It is very good of the hon. Gentleman to give way. He has fairly described the Committee's debate on charging, but I think that he will allow that the Committee was able to observe that the Strathclyde and the Metropolitan police forensic science services were both peculiar and the creatures of the two constabulary services. Therefore, they faced quite different problems from those which exist for the 42 police forces of England and Wales, which have to dip in to the Home Office forensic science service. The smaller forces certainly, and perhaps all the forces, would be unable to establish their own service in the way that the much larger Metropolitan and Strathclyde forces have, of course, been able to do.
Mr. Worthington: I accept that there is a closer relationship between a single force and its laboratory than between regional laboratories and a multiplicity of forces. It is interesting that this simple idea of charging for services on a piece rate basis had not been proposed in the past, but was the product of several years of decline within the forensic science service.
The problem with charging is that it assumes that chief constables make rational decisions. It may seem extraordinary for me to challenge the rationality of chief constables, but at present with a free service—the contribution has been decided according to the common police services budget—they do not make rational decisions. The report referred to one force that referred 6.7 cases per 1,000 crimes and another that referred 1·5 cases per 1,000 crimes. At the moment, there is no price, yet the forces seem to make highly varied decisions. If rationality is to be applied within the charging system, we would have expected that rationality already to exist under the present system, which does not seem to be the case.
We know very little about whether our police forces are efficient or rational, because we have chosen to exclude them from scrutiny for far too long. We make assumptions about their efficiency which we cannot back up because public expenditure on police forces is an under-explored subject. That problem has been partly due to the system of local police forces, in which the operational control is

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given solely to the chief constable. Therefore, it has been extremely difficult for local police authorities to judge how expenditure is incurred.
While I agree to some extent with the Chairman of the Select Committee about the excessive number of police forces in England and Wales, I would be dubious about remote police forces which would exacerbate our present lack of knowledge about police operations. Our system of local accountability is undeveloped and under-resourced. We have not developed an adequate means of assessing the efficiency of police forces.
One of the points in the forensic science report about which we were most critical was that, after 50 years of the forensic science service, we are still no closer to knowing whether the level of that service is adequate. Precious little research has been done about whether we use our forensic science services in a cost-effective way. Some work, including the Ramsey report, was done in about 1986, but it did not take us any further. Touche Ross, an outside consultant, was commissioned to produce a report that would enable us to judge whether we were receiving an adequate level of service. However, Touche Ross flunked that task and simply produced a recommendation about charging, believing that the market mechanism would settle the proper standard of forensic science services. The report showed that police forces were far too little aware of the resources which could be given by the forensic science service, and that communication from the service to the police was inadequate.
I have an important question to ask the Parliamentary Under-Secretary of State, and if he can stop resting his eyes, he may be able to answer it. Has anything specific been done by the Home Office to commission research that would enable us to tell whether the funding of the forensic science service was adequate? We constantly heard from people about how many hundreds of man hours were saved by the timely introduction of the forensic science service.
One often felt that the staff of the forensic science service talked about their most glamorous cases—about their contribution to the Yorkshire Ripper case, for example. But we need to know what forensic science can contribute to the humdrum cases. People whose houses are burgled are frequently very upset about the perfunctory work done by the police service when following through what has been an extremely significant event in their lives. The police would say that they cannot devote much time to investigating those crimes because of their lack of resources. Given the techniques available to forensic science, it is a great pity that adequate research into whether it would be cost-effective for more forensic scientists to work in police investigative teams has not been done. We were also made aware of the extent to which evidence is destroyed or insufficiently dealt with if no forensic scientist is present.
I ask the Under-Secretary to go beyond the Home Office's response, which is once again that the matter is being looked into. Has a decision been made to conduct the—admittedly extremely sophisticated—research to enable us to judge on cost-effective grounds whether we are properly staffing our forensic science service? At the moment it is just guesswork: we deserve something better.
Mr. Robert Maclennan: I ask the hon. Gentleman in a spirit of inquiry whether during his and the Committee's considerations they
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became aware of any great difference in the attitude of the various client police forces to the effectiveness and value of the forensic services. Would such a difference show up under the proposed methods of financing?
Mr. Worthington: I am grateful for that intervention, I referred earlier to how forces vary in their use of forensic science service, and there are many reasons for that. For example, the Kent force told us that it has to use the Aldermaston service. Travelling from Maidstone to Aldermaston constitutes a formidable disincentive to using the service, given that it involves travelling past the Metropolitan police forensic science laboratory. I suspect that individual officers' knowledge is often a reason for variations in use, too.
Mr. Barry Sheerman: My hon. Friend has put his finger on something. Deficiencies in the training of our police forces, and hence in their knowledge of forensic services and how to use them, are deeply embedded in their education procedures at every stage, particularly in the training procedures for officers who go on to criminal detection.
Mr. Worthington: That is right. That is why I am asking for more research. Remote regional laboratories may not be the most effective way of building up links with the police forces. Earlier, I mentioned the necessity of involving forensic scientists more routinely at the scenes of crime. That would go against the trend of recent years, when scientists seem to have been more and more laboratory-bound. They have waited for the work to come in rather than going to the scene of the crime.
Mr. David Ashby: Does the hon. Gentleman agree that a better management of resources might be the key, and that that takes us straight into higher police training? Could not the best use he made of forensic science in that way?
Mr Worthington: The general thrust of our report was that we did not believe that there had been coherent management of the service. The first step is to try to find a way to assess the appropriate forensic service for the differing case loads of the police forces. Such research is immensely difficult, but it has not been attempted. Our report seems to suggest allowing it to be done by charging—if a force wants the service, it will pay for it, so we will know whether the service is adequate.
That response is not good enough, given the imperfect nature of the market, which depends on people's knowledge of what forensic science can do. It also depends on geographical factors. If we are ever to use charging, the time to introduce it is after scientific research has established the proper level of a forensic science service in the first place; otherwise, we shall try charging for a few years and then people will ask how we know it is working. We cannot assume that it works. The only way to check is to commission research into whether the service provided is appropriate for the case load of the police.
Mr. Sheerman: I thank my hon. Friend for giving way again. I share his misgivings. The Select Committee report will help to get the forensic service right, but to begin charging now might lead an investigating officer, under pressure from above, to ask how much a forensic

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investigation would cost and to reject it in order to cut costs. His chief constable may be looking over his shoulder.
Mr. Worthington: That is right. A chief constable is under pressure from many directions. He is concerned not only with forensic science and the detection of crime; he is under pressure to spend more from what is available—his force may be demanding overtime, he has to deal with traffic matters and with whatever worries his neighbourhood. An invisible and distant regional laboratory will tend to be forgotten. Forensic science offers no certain pay-off. A chief constable may invest in it as a way of finally nailing an offender with a missing piece of proof, but he may not invest in the speculative forensic science work which may be necessary at the early stages of an inquiry but may not seem to offer a certain return at that stage.
I look forward to the Under-Secretary's response to the report. It is a critical report, and the response has assured us that our criticisms have been taken seriously into account, although it has come across in rather a bland way. I hope that the Minister will be able to assure us that the forensic science service will have a much happier time during the next 10 years than it has had during the past 10 years.
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Dame Janet Fookes: I suggest to the hon. Member for Clydebank and Milngavie (Mr. Worthington) that he has missed the main point which the majority of the members of the Committee felt important in relation to charging for the forensic science service. Surely the important consideration is that chief constables and those below them should have as much freedom as possible to dispose of resources as they believe right. In some instances, the careful use of forensic science techniques can save overtime and all manner of other uses of the police so that they can get to the point with the aid of forensic science. With proper management by chief constables and those immediately under them, it will be possible to make that choice. It is not as though the services of the forensic science laboratories are now available ad lib. We are aware that the laboratories are able to take on only a certain amount of work. In these circumstances, the arrangements that we are suggesting would be far more practical.
It has been valuable for the Select Committee on Home Affairs, of which I am a member, to have examined closely various features of the police service in the past few months. I say that for two reasons. We are well aware that our constituents, the public generally and the media are preoccupied with and concerned about ever-increasing levels of crime. Members of the public are especially concerned about crime that can affect them, such as attacks on them by others and the possibility of burglary and robbery.
We are aware also that crime in its more sophisticated sense is reaching out in a way that is terrifying. This is not the occasion to deal with the Committee's current inquiry into drug trafficking, but it is clear that the trafficking goes beyond the remit of regional arrangements. It is international in scale, and on such a scale that it almost beggars belief. In the circumstances, we are surely right to
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concentrate on our first line of defence—the police—to ensure that it is as well geared as possible to deal with the immense problems facing it now and in future.
The police service is costing an immense amount each year, and that is particularly relevant when we are considering Estimates. It is costing about £3·5 billion a year now, and the cost is likely to rise in the next year or two to well over £4 billion. We have a duty as hon. Members to ensure that that colossal sum each year is spent wisely. That brings me to my concern about higher police training and the staff college. Given the scale of crime and the scale of the resources that we devote to the police service, it is essential that the training of those who are the leaders of the police, in the jargon of the ranks of the Association of Chief Police Officers, is as good as possible. That must apply to what might be called their professional expertise and to the management of their resources, whether that is in terms of manpower or the various expertise that is available to them.
The Committee was fortunate in seeing not only the staff college at Bramshill but the training college in Scotland. Some members of the Committee were also fortunate enough to see the FBI academy at Quantico, Virginia, from which some of us returned only a short while ago. It has been possible for us to make some comparisons with our own training college. I was delighted on overseas visits to learn how well regarded the Bramshill college is and what a role it has to play in the international sphere as well as in providing training for our police force in England and Wales.
There is a particular difficulty, however, which I was staggered to find. The Chairman of the Committee, my hon. Friend the Member for Westminster, North (Mr. Wheeler), has already spoken of it, but it is one which needs to be stressed. It is possible to reach the ACPO ranks without ever attending the staff college at Bramshill. The figures are alarming. No fewer than three chief constables, 11 deputy chief constables and 67 assistant chief constables have managed to dodge, as it were, senior command courses. Some of those who have taken the trouble to participate in the courses have not received a reward commensurate with their expectations. I gather that 33 officers have attended the courses and have not received preferment.
I warmly endorse the recommendation that by 1993 it should be compulsory for all officers in the higher ranks to have completed a senior command course. I hope that by the end of the century that principle will have been extended by younger members of the police force taking the special course for high flyers first. I suppose that I am now looking ahead to the next century. The present under-subscription is disturbing and it is something that needs to be remedied.
I shall devote a little attention now to the problems that the members of the Bramshill staff encounter. One might have assumed and hoped that any officer who takes time out of his normal career to go to the Bramshill college to make his expertise available would find subsequently that his career prospects are enhanced. The exact opposite appears to be, and is, the case. Officers forfeit opportunities by going to the college. It is hardly surprising that it is difficult to attract individuals of the right calibre. I believe that I am right in saying that the post of assistant commandant was vacant from January to

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about April. It appears that no one had even nibbled at the post, let alone there being a group of applicants from which to choose.
In these circumstances, we have as a nation been singularly fortunate in having so outstanding a commandant as Mr. Bunyard, who I think impressed all members of the Committee by the immense initiative that he has taken to bring all the courses up to date and to give them real vitality in the face of the changing problems in crime and policing. Shall we be so lucky again unless urgent steps are taken to ensure that no one suffers in his or her individual career pattern'? I do not know why I said "her", as there seems to be a marked absence of women at that level in the police force. I shall not pursue that hobby horse now.
It is clear that some changes must be made. My hon. Friend the Member for Westminster, North has already touched upon one of the difficulties under the present system, which is the absolute right of police authorities to choose whom they will for entry into the higher ranks. There is no particular slot available for those who have done their stint at Bramshill. I warmly welcome the Committee's suggestion that they should become part of the special cadre at Home Office level, from which the various police authorities must choose to fill their appointments. That is vital if the staff college is to occupy the central place, as it should, in the education of the higher police service.
It was interesting to note that the overseas course run by the staff college is highly popular with people from many Commonwealth and other countries. During our recent trip to the United States, we met one or two people who had attended the staff college and they spoke highly of it. The course should be extended because, apart from spreading good practice to other countries, it is of immense value in forging intimate links, which are not otherwise available, with countries that send their police officers to Bramshill. It is paralleled with the higher education that we give to young students from Commonwealth and, in particular, Third-world countries. It is one of the most valuable ways in which we can help the Third world. I very much hope that my hon. Friend, when he replies, will encourage our hope that the overseas course might be allowed to expand.
It is clear that more money is needed to keep open the staff college. For example, the library is housed in bits and pieces all over the place. it is an excellent library and an important resource, but it is difficult for students to use it effectively. I urge my hon. Friend to ensure the provision of new accommodation. Indeed, there should be new accommodation for the students. We must remember that many of them are highly placed police officers who do not want to occupy third-rate 1950s and 1960s-type accommodation, which was never very good in its heyday and is now well past it. We were allowed to see a sample of the accommodation, and it was not worthy of the position that the staff college holds.
While there is some doubt about the staff college remaining on the Bramshill site, I can understand the case for being cautious about improvements, because they would be extremely expensive. I hope that my hon. Friend will take on board the Committee's recommendation that a decision should be made soon on whether the site should continue to be used, as we hope it will. The house provides a fascinating centrepiece that attracts all who go into it. We must never under-estimate the effect of symbols. It is
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rather like the military bands attached to the armed forces; they have an importance and a value far beyond just providing music or an attractive aesthetic environment.
We are aware that the Home Office is considering whether any of the money confiscated under the Drug Trafficking Offences Act 1986 should be used for the police service. We are also aware that that is not likely to be attractive to the Treasury, which always holds the firm policy of taking in any money, spare or otherwise, to dispose of as it wishes.
Mr. Wheeler: Searching the streets for pennies.
Dame Janet Fookes: My hon. Friend makes an interesting intervention.
It is not likely to be popular if we suggest that money should be diverted from the greedy clutches of the Treasury. It does not matter which Government are in office because the Treasury attitude remains the same. There is a case for allowing the police service to retain some, if not all, of the money confiscated under the Act. In what better way could we spend some of that money than on the upkeep and an increase in the work of the staff college? Indeed, the report recommends that, and I hope that it will be taken seriously. It has the merit of not picking out one police force as against another; it is common to all. It is especially appropriate that the money should be used in that way.
I wish to discuss one or two of the wider issues arising from our inquiries. They have been touched on in the remarks about the forensic science service, and they apply equally to the training of the police. There are grave weaknesses in the way in which our police service is organised and split between the 43 police forces of England and Wales, coupled with the separate police service in Scotland. At a time when there is an increasing need to pool resources and to act not only nationally but internationally, there must be some doubt about whether the current tripartite system should be allowed to continue. That point does not arise out of the report's recommendations; I make it simply as a personal view.
The more we study the police service, the more we find weaknesses arising from that pattern of arrangements. I shall not he so bold as to say how I think it should be organised, and in any case, it is probably beyond the scope of the debate. I simply state that urgent questions should be asked, not only by our Committee but by Home Office Ministers. The problems of crime are likely to increase, as will the costs of dealing with them. In the 1990s there will be difficulties in recruiting sufficient police because of the downturn in the birth rate.
In all those circumstances, I believe that the Home Office should take a hard look at the problems, and not take too long about doing so, because we must ensure that the police service is geared for the turn of the century and beyond.
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Mr. John Greenway: My association with the police service over many years is well known. I had the privilege of serving as a policeman in London for five years during the 1960s. More recently, I served as vice-chairman of the North Yorkshire police authority. I am now greatly enjoying a third bite at the cherry of police activity by

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working with the Home Affairs Select Committee under the very able chairmanship of my hon. Friend the Member for Westminster, North (Mr. Wheeler).
Some important facts have already come out of tonight's debate. There is a great deal of agreement among hon. Members on both sides of the House about the problems that face our police service in society's fight against crime. We are not looking to answer those problems with ideological solutions. Nevertheless, there are one or two different remedies, which the hon. Member for Clydebank and Milngavie (Mr. Worthington) has mentioned.
It is important to say at the outset that there has been an unprecedented increase in crime, not just under this Government, but over the past two or three decades. There is grave public anxiety about how we should tackle the crime rate and how we should best respond to society's anxieties. The main purpose of the Select Committee's inquiries into police matters is to make the policing of Britain more effective so that the public will feel more reassured and, in particular, have their confidence in the police restored. It is a great tragedy that, for a variety of reasons, that confidence has been eroded in recent years.
I am sorry that my hon. Friend the Member for Uxbridge (Mr. Shersby) is not in his place, but I understand that he hopes to take part in the debate. However, it is important whenever possible to pay tribute to the dedication of our police service. The comments that have been made tonight and in the Select Committee's report are a reflection not on the dedication of our policemen but on the archaic structures that are increasingly coming under strain and stress.
There has been a notable recurrence of several common themes in our recent inquiries into police activity. They include the problems of funding and whether we are funding our police services adequately, despite the record resources that the Government have made available to the police service and to increasing manpower. There is the need for more central direction and co-ordination of police services, to which my right hon. Friend the Home Secretary referred recently in a major speech about policing Britain.
There is the potential benefit to the community of consistency in policing policy and performance. Working with the North Yorkshire police authority, I found that crime is no longer the province of local villains. It is a mobile problem. In north Yorkshire, many burglaries are committed by gangs who can be 50 or 60 miles away within half an hour using fast motor cars. That emphasises the need for more consistency and greater co-operation and co-ordination.
There is the problem of the under-utilisation of specialist support services, particularly in training and in the forensic science service, which was dealt with in two of our reports. Finally, there are the strains and stresses of the existing structure, to which I have already referred.
In our reports, we have offered markedly different solutions to the problems of various aspects of the police service as we felt was appropriate. For example, on funding and direction—matters that have already been outlined—we looked for greater direct responsibility in police forces in the use of the forensic science service and perhaps even greater responsibility in carousel training
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courses on particularly topical isues at the police college at Bramshill. They could be accommodated at force level, but we look for more central funding and co-ordination, higher police training, police recruitment, the installation of telecommunications equipment and—without preempting the report that we shall lay before the House later this year on drug trafficking—national co-ordination and effort in the war against the scourge of drug abuse.
The procedures for funding common police services are protracted and cumbersome given the amount of money involved in relation to the overall costs of policing and local government expenditure. The Home Office acknowledged that during our inquiry, suggesting in its memorandum that local authorities may be faced with a bill for services on which they have not been fully consulted, although both parties have sought to make the system work as well as it can. But the Home Office memorandum discussed only the cost arrangements and did not deal in detail with the discussions between the Home Office, police authorities and local government agencies—the Association of County Councils and the Association of Metropolitan Authorities.
I do not want to dwell on that matter at length, but I refer my hon. Friend to an interesting exchange of views which took place during the evidence given by the head of the finance and technology group at the Home Office, when the conflict that that creates was clearly admitted. In his final comments, the head of the finance and technology group said:
"I would not want to have a Common Police Services Committee made up of the members of every one of the subsidiary services. That would be unmanageable. What the local authorities therefore have is a group of representatives who are, after all, empowered by the local authority associations to take decisions which commit members to spend money. This really is where the buck ends, because at that stage they are talking about a figure, they have to agree a figure, or the Home Secretary in the end has to decide on a figure on the basis of their evidence, which ratepayers will have to meet. So there is bound to be a conflict of interest between those who want more training or more forensic science and those who have got to meet the bill."
It was the strains and stresses of that conflict which caused the Select Committee to suggest in its recent report that the common police services budget should be a centrally funded item in the way in which my hon. Friend the Member for Westminster, North has already outlined. That conflict creates difficulties for chief constables, police committees, police authorities and local authorities. It also raises questions of accountability.
Chief constables have difficulty in exercising judgments about how a chief constable should best police his force. There are difficulties for local authorities in balancing the need to maintain and develop an effective police service without which other more substantial expenditure on manpower, to which they have gladly committed themselves, may not be put to best use. At the same time, there is a need to control expenditure for ratepayers.
Those local authority representatives who assist in controlling the common police services expenditure are seldom in a position to decide on policing priorities. In addition, chief constables are already facing detailed local negotiations with their council treasurers or leaders or chairmen of policy resources committees over the cost to the local authorities of the chief constable's own plans at force level, which may also involve detailed representations to the Home Office for approval. Matters of equipment, police house repairs or the standard of police

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stations and accommodation are discussed for many hours by local police chiefs and their police committees, but a discussion of what is in the common police services budget seldom, if ever, takes place. That is one reason why we considered direct charging for forensic science as a way forward.
Our report recommends that the ACPO secretariat should be strengthened in order to improve the central co-ordinating force within the police service. That seemed to be the only sensible way forward within the present structure.
However, chief constables have only a limited accountability to their police authorities. They are not accountable for operational matters. No one should seek to change that essential absence of political interference in police operations. Nevertheless, my right hon. Friend the Home Secretary looks to ACPO to provide more central co-ordination and to assume additional functions on a national basis. It is not clear what line of accountability such arrangements would create for my right hon. Friend and for the House, particularly given that the only line of accountability for chief constables is to the 43 police authorities—and even that is limited.
That all suggests a need for change. The Committee's report recommends that the ACPO ranks become a centrally directed force. That would be one way of achieving better accountability and co-ordination, but I wonder whether we should consider a further opportunity. When members of the Committee visited the police college in Holland and spoke to officials of the Dutch criminal justice department, it became clear that that country has a completely different arrangement for chief police officer representation. Holland has a separate body to deal with the requirements of chief police officers' professional associations, and another for central co-ordination of police services.
The structural stresses and strains in our police service require serious consideration of that arrangement, and I should like to see formed a new, central support committee, drawing on only a small number of police constables but involving also inspectors of constabulary, a handful of representative police authority chairmen, and Home Office officials—all under the formal chairmanship of the Home Secretary, and thereby accountable to this House.
In that way, the role of ACPO as a professional association could be kept separate, and would avoid the difficulty of securing agreement from 43 chief constables, let alone that of all the deputy chief constables and assistant chief constables—who together constitute the 249 members of ACPO. Getting them all to agree on policy is far from easy. We must break through that barrier and instead get heads together to arrive at solutions to improving the effectiveness of our police service and making better use of the substantial resources we commit to it.
The objectives are only too clear. We must continue to improve the professional standard of policing, for only in that way can confidence be restored. We must ensure that police have access to the finest training, and that those who provide it are of the highest calibre and have up-to-date practical experience. They should include, as my hon. Friend the Member for Plymouth, Drake (Dame J. Fookes) pointed out, officers who will subsequently achieve higher rank in the service, so that the time they
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spend at Bramshill as training officers will be part of their career development, rather than an avenue at the end of a distinguished police career.
We must ensure that resources are used to best effect. It is not just a matter of ensuring value for money from forensic science or police overtime but of reordering priorities. It is about ensuring not only that the value and benefit of forensic science, for example, is better appreciated but that that service is given every opportunity and encouragement to achieve its potential.
Structures are under pressure not only because of financial constraints, though it would be wrong to under-estimate the difficulties that such constraints create. Structures are under pressure because centrally provided facilities have been unable to develop their full potential and to provide the quality of service needed to convince chief constables, seniour police officers and police authorities of the benefits that such professional help can bring to the fight against crime. There is no doubting that chief constables are fully aware of the value of forensic science, but given the inadequate facilities to be found at some laboratories, it is difficult to see how chief constables would be encouraged to refer cases to a forensic science laboratory, when they want a much quicker solution to a particular criminal investigation.
There is much anecdotal evidence of the savings in police resources through more skilful use of forensic science, and the Committee recommended that there be more investigation of that aspect. Even so, an expanded forensic service along the lines suggested by the Committee would make a major contribution, if implemented over the three years that the report suggests. I hope that my hon. Friend the Under-Secretary of State for the Home Department can give the Committee and the House information about the progress of discussions and negotiations with the Treasury.
The question has already been asked whether direct funding of forensic science would provide a suitable solution. In my view, it would. Direct funding would highlight for police authorities the value of forensic science. Most police authority members are unaware of the behind-the-scenes arguments, but would become aware of activities within the forensic science service if it was an item in the budget, to be considered in the same way as other heads of expenditure.
The hon. Member for Clydebank and Milngavie asked how one would know that direct charging was working. The answer is that we must give it a try. How do we know that committing hundreds of thousands of pounds—or, in larger forces, millions of pounds—to police overtime works?
As to the structure of 43 police forces, I know that there are differences among the members of the Committee, and I take the point made by the chief constable of north Wales, and chairman of the association's crime committee, who clearly drew the Committee's attention to the undesirability of wholesale changes of structure because it would divert and erode police effort. Nevertheless, if we believe in a local management system that does not interfere in operational matters but which would give a chief constable and his force the financial and managerial support that they require, I see no reason why we should not trust the police authorities to deal sensibly and properly with forensic science services on a direct charging basis. It would be an insult to the forces' integrity and professionalism to suggest that they would do otherwise.

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The Committee suggested that the Home Office and the inspectors of constabulary should issue guidance on the use of forensic science, and recommended—as did Touche Ross—that more scientific support managers should be appointed to help police forces make greater use of it. Central co-ordination and funding of DNA profiling will be essential if this major opportunity to improve detection of offenders and to eliminate suspects—DNA profiling will be particularly relevant—is to be realised.
My hon. Friend the Member for Drake spoke at some length about Bramshill college, so I shall refer to it only briefly. I strongly support the comments that have been made about the method of selection and appointment of senior police officers. It is haphazard and amateurish. The chief constable of Sussex police, Mr. Roger Birch, described it as an unprofessional lottery.
Chief superintendents do not have a sufficient incentive to take the next step up in the ACPO ranks. Many factors dissuade and discourage them from taking that step, quite apart from the major domestic upheaval that is caused because people have settled into particular areas. There are changed pension arrangements and little additional remuneration for a chief superintendent who becomes an assistant chief constable. It is astonishing that 47 per cent. of assisted chief constables have not attended a senior command course, but that must be balanced with the more damning evidence that many police officers who have been on senior command courses have not taken the step beyond chief superintendent rank into the ranks for which they were selected and trained.
As the Home Affairs Committee recommended, funding of the common police services should become a centrally directed arrangement. I agree with my hon. Friend the Member for Drake and the recommendation in our report that it would be no bad thing if drug profit confiscations were committed to a trust, with the police college as a major beneficiary. My hon. Friend referred to a good band and to images. The reputation throughout the world of Bramshill college is based upon its skill in training senior police officers. It is not a reflection of the quality of accommodation available for them.
Higher professionalism is the key to retaining and restoring confidence in the police. Such professionalism demands up-to-date practice and high-quality training. Great strides have been made, but much more could be done if priorities were reassessed and reordered. I am sure that the Committee will look forward to hearing the Minister's response.
5.43 pm
Mr. Harry Barnes: In discussing common police services, I want to refer to the problems associated with disaster planning. I am interested in that issue because of my constituency concerns.
The police are involved in two aspects of disaster planning. First, problems can arise in designated works, such as Staveley Chemicals in my constituency. If a disaster occurred, the population nearby would be seriously affected. Obviously, the emergency services must have plans to handle a disaster, and the police are at the forefront in triggering action. It is essential that the latest
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technology is available and that police methods are correct, and that involves the police training college and other back-ups.
Secondly, there are general disasters for which there is no specific contingency plan but only a general plan. That general plan must be adapted to handle railway emergencies, air disasters—such as the east midlands disaster, in which Derbyshire county police provided assistance—toxic and hazardous waste problems and the nuclear transhipments that travel up the M1 and clip the end of my constituency at Heath. Any such disaster could hit anywhere and must be handled carefully.
The police engage in periodic exercises to handle potential disasters such as air crashes. The backing that they are given is essential. They often suffer from inadequate training and have difficulty in releasing manpower to provide common services and appropriate training. The Home Office has wide powers. Paragraph 12 of the fourth report of the Home Affairs Committee states that, under
"the Police Act 1964, the Secretary of State 'may provide and maintain or may contribute towards the provision or maintenance of a police college, district police training centres, forensic science laboratories, wireless depots and such other organisations and services as he considers necessary or expedient for promoting the efficiency of the police'."
The Home Office bears 51 per cent. of the costs. This presents great difficulties when local authorities are involved with the police authorities. There have been a number of years of Government cuts in financial assistance and now local government funding is to be transformed with the introduction of the poll tax.
More funding should come centrally to develop effective disaster planning. The difficulty is in deciding who controls what happens—central police forces or local police forces. It is essential for the police to have adequate resources. They are expected to show the right susceptibilities in handling problems. Considerable training and provision are required in respect of not only disasters but general policing matters. Police officers may not be aware of what to do in an accident involving hazardous or toxic waste. The most that even a senior policeman is given is a short course, when he merely examines a video for an afternoon, and he is then expected to act. The answer is to provide considerable resources to enable the police to release the appropriate training manpower.
The fourth report also deals with the role of the secretariat of the Association of Chief Police Officers. I have just come down from the Committee on the Football Spectators Bill. My connection with ACPO is its statistics on arrests in or around football grounds. The Minister for Sport gave those statistics to the House and they became known, incorrectly, as the "League of Shame". My investigations into the figures show that there were errors in the statistics and that ACPO was unable to supply details to explain which arrests were inside the grounds and which were outside, the reasons for the arrests and the categories of offence involved. Were the arrests for the carrying of a klaxon horn, for example, which occurred at one club, or for theft? How many arrests were of street traders outside football grounds?
The secretariat clearly needs some organisation so that it can present adequate information in matters in which the police are involved, especially in matters that relate back to the Hillsborough disaster. It seems that police forces throughout the country collect information which

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varies according to local experience. That information is then stuck together by the central organisation which clearly lacks the expertise and time to put information together effectively and in a way that would allow the House to judge properly an issue which is of concern and which could have a considerable impact on the work of the police.
That issue also has an effect on the way in which disasters are dealt with. I understand from a parliamentary question that the Home Office is concerned about disaster legislation. America, France, Australia and several other countries have contingency planning and centralised co-ordination to handle disasters. That is not dealt with adequately in this country. We should ensure that there are proper centralised services to assist the police, because they are at the forefront of co-ordinating and organising the different authorities, such as the fire service, that have to be brought together to pick up the pieces when a disaster occurs. Some of that could be achieved by careful planning. There must be greater understanding and education so that people can adapt and make adjustments according to the circumstances.
When the east midlands air disaster occurred, for example, the mountain rescue organisation was of great value. That organisation automatically dug steps into the embankment, which meant that rescue arrangements could he handled easily. Such information could be spread by a central organisation, but that does not happen automatically at present. We must ensure that the correct groups of personnel are involved in dealing with disasters and are able to respond effectively.
Mr. Ashby: As the hon. Gentleman knows, Kegworth, where the air disaster occurred, is in my constituency. One fact that emerged crystal clear from the disaster was that all the many years of training for just such a disaster fell into place perfectly. The co-ordination required was there because the planning was there. The rescue services had thought long and hard about every eventuality. One cannot pay anything but the highest tribute to the rescue services in Leicestershire on that day.
Mr. Barnes: I agree with the hon. Gentleman. My own local knowledge of the services operating in Derbyshire which assisted at that disaster tells me that the hon. Gentleman is correct. However, it is important that, as well as having trained and dedicated people to help, we should ensure that they have the right materials and understanding to handle disasters. A common-sense approach needs to be developed. When dealing with hazardous and toxic waste, for example, what is needed is not only the ability to turn to the relevant information, but for the police to have a good pair of binoculars so that they can pick out the information at a distance, rather than placing themselves in great difficulties. The spread of training, the sharing of training exercises and the building up of national policies for handling disasters will lead to applied common sense and dedication being able to work effectively.
5.57 pm
Mr. Michael Shersby: I must first delcare an interest as the parliamentary adviser to the Police Federation. I must also congratulate my hon. Friend the Member for Westminster, North (Mr. Wheeler) on the great clarity with which he presented the recommendations
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of his Committee. It was especially interesting to listen to my hon. Friend explaining exactly what was proposed and how the Committee had arrived at its conclusions.
I want to deal with the future of the forensic science service. Paragraph 93 of the report recommends that the Home Office should plan to transfer direct financial responsibility for the regional forensic laboratories from central support services to individual police forces. That proposal is of major importance and of legitimate interest to the Police Federation. The Touche Ross report made the point that one does not appreciate a service unless one pays for it, but I am told that, due to a shortage of staff, the forensic service has not always been able to respond as fully as it would like to police requirements. Staffing is obviously of vital importance.
The Police Federation believes that many of the report's conclusions and recommendations are based fairly on the evidence given to the Committee, but there are several matters of concern about the proposed change in funding arrangements, which I will highlight. The Police Federation believes that such a change could have a serious effect on the investigation of serious offences, especially by smaller forces. Following the Brighton bomb murders, for example, 1,200 dustbins of rubble and material were sent for forensic examination. One cannot help wondering whether a force would be prepared to meet such costs, especially if the victim were a vagrant or someone of lesser public importance than those who were unhappily involved in that tragedy.
There is also the question whether a smaller force would be able to finance a large-scale DNA screening exercise, espcially if the people to be screened were from the area of an adjoining large force. Those costs would be the smaller force's responsibility, simply because the murder victim was found within its force area. I shall give the House a hypothetical example. Let us take the case of a serious murder which must be investigated by the local force. If a Londoner were found murdered in, say, Bedfordshire—which has a comparatively small force—Bedfordshire would have to assume responsibility for the forensic costs involved in that investigation. That point is causing the federation some concern and, like me, it will be interested to hear what my hon. Friend the Under-Secretary of State for the Home Department has to say about that aspect when he replies to the debate.
Another aspect of the forensic service which is of great importance is the quality of the service. It is widely agreed both in the House and outside that it is vital to maintain that quality, because so much depends on it in the detection of crime.
The Select Committee on Home Affairs recognises that the service should seek to appoint and train about 40 new staff per year for each of the next three years. Allowing for natural wastage, the Committee states that that would leave the service 10 per cent. larger than is currently planned. In its reply to the Committee's recommendations, the Home Office has stated that it is actively considering the case for further increases in staff for the forensic service. It then points out that in the light of the Select Committee's recommendations and other information, it is already committed to bringing the service up to complement. At present it is 23 members of staff below complement. The additional staff proposed by the Select Committee exclude those staff.
Therefore, on the assumption that wastage will continue at about 20 per cent. per year, the Home Office

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pointed out that the Committee's proposals amount to a net increase of 60 posts by the end of March 1992, roughly 10 per cent. over and above the 51 posts already planned.
The Government's reply then contains a sentence which I view with concern:
"The implications of this, and the costs and benefits of the additional staff, will be covered in the assessment the Home Office is making."
I am sure that my hon. Friend the Member for Westminster, North and his colleagues will wish to see that matter pursued and to be certain that the additional staff that they recommend are provided. Having said that, one recognises the Home Office's difficulties in funding such an operation.
Mr. Wheeler: It is good of my hon. Friend to allow this brief intervention and I assure him that the important point that he has raised will be pursued. It may be helpful for my hon. Friend and the House to know more generally that it is the practice of the Select Committee on Home Affairs to review its reports regularly, to look back to the recommendations that it has made and to assess the progress that has been made with them. Therefore, there is the opportunity to measure those points once again—that is, apart from the value of the comments made by my hon. Friend in this debate.
Mr. Shersby: It is reassuring to know that my hon. Friend's Committee follows up its recommendations. Indeed, one would expect nothing less from a Committee of such excellence.
I turn now to the issue whether the work of the service should be entrusted in the future to a body with executive agency status. That is an important aspect of the report. One must consider how the executive agencies which have already been set up are working. So far the experiment—or rather, the change—has been a good one, and positive results are already flowing from the change of status. I hope that the Home Office will follow that up and that the change to executive agency status will be carried out in the not-too-distant future.
I welcome especially the comments in the report on relations with the police. I should like to put on record how much the federation welcomes those paragraphs in the Committee's report and in the Government's response to it.
DNA profiles are a move of the utmost importance in the detection of crime. The costs involved in carrying out that type of research are probably not yet fully appreciated. They may well increase considerably in the years ahead, and clearly that factor will have to be taken into account in a change in funding levels.
In conclusion, paragraph 20 of the Government's response, which deals with forensic pathology, states:
"The final meeting of the Working Party on Forensic Pathology took place in April 1989 and their report is now being submitted to the Home Secretary."
I understand that that working party has been in existence for four years. I should be grateful if my hon. Friend the Under-Secretary would say something about when the working party's report will be published, because it is a matter of considerable interest to all those who are interested in forensic pathology, and not least to the members of the Police Federation.
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I am grateful for the opportunity to have made these brief comments on these serious, interesting and excellent reports, and I look forward to hearing my hon. Friend's reply.
6.6 pm
Mr. Gareth Wardell: I shall refer briefly to the forensic science service. The work of the Select Committee on Home Affairs, under the chairmanship of the hon. Member for Westminster, North (Mr. Wheeler), was a great public service to the people of this country.
The test of how well the Government have responded to the Select Committee's report will depend to a great degree on whether they take on board the point that the chief constable of Kent made in his evidence to the Select Committee, when questioned by my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington).
It is vital that the House remembers the critical comments of paragraph 108, which state:
"Following the Rayner Review, 'Selectivity' was the expression which came along and cases were extremely carefully sorted out before they were sent off to the laboratory. They were not sorted out necessarily so that you were going to get the best result from the laboratory, full stop, but because the investigating officers knew that the manpower resources available at the laboratory were not such as to do more than a fraction of what investigating officers wanted them to do. As a result, a lot of stuff that you would have expected to have been forensically examined was not and still is not. It is not right, but that is the truth of the matter. The spinoff from that, of course, is that there is less confidence by officers who do not necessarily understand the problem but understand the result in the Forensic Science Service, and that will go on to people not being as careful or as enthusiastic at the scene of the crime as they should be, because they do not anticipate that they are going to send anything to the laboratory in any event."
That will be one of the crucial tests that the Home Office and the Government will have to pass. They will have to justify themselves and tell the people of this country that justice does not come cheap and that it is vital that resources are made available. The pay must be good enough to attract people into the laboratories. It is nonsense that police officers cannot send exhibits that they find at the scene of the crime to the laboratory. That is a terrible indictment of the present situation, and people are no longer prepared to accept it. I hope that the Government will come up with the goods.
The chief constable of Kent did an excellent service by sending the Committee a letter—it is printed on pages 61 to 63 of the report—continuing examples of the excellent work that the forensic science service does. I shall not list all those examples now but let me give the House one of them. It concerns a murder in Shifnal in 1984. The forensic science laboratory was able to identify a single imprint of a shoe outside a particular property as the imprint of one of only 90 pairs of shoes imported into the United Kingdom from an Italian manufacturer. All the people who had purchased the shoes were traced, and a conviction was made. It is critical, not only in serious cases such as that but in far less serious cases, that the facilities are available to police officers to enable them to send all the scientific exhibits that they wish to send to be properly examined and to receive the necessary treatment.
Mr. Sheerman: Is not one aspect of the Select Committee's deliberations rather worrying? I refer to the evidence from senior people in the police force and,

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indeed, chief police officers, who said that charging for the service might mean that the investigating officer would consider the cost to his force first and only then whether the evidence might be useful in apprehending a criminal somewhere down the line.
Mr. Wardell: I share my hon. Friend's concern. If cash limits in the police force are such that an officer cannot submit exhibits to the forensic service because of cost considerations, that will have serious implications for justice.
My second point concerns the availability of forensic pathologists. I shall rely heavily in my remarks on the comments of the president of the Forensic Science Society, who is professor of forensic pathology at the university of Wales college of medicine in Cardiff. In evidence to the Select Committee, which appears on page 159, in paragraph 421, Professor Bernard Knight says:
"The basic problem is that the core of forensic pathology, which is university based, has declined so much that it is now ineffective in really training sufficient future pathologists and also training those from the hospital service who are newly appointed and who actually numerically now markedly outnumbers us in the Home Office appointed list. This central core is shrinking rapidly and one wonders what is going to happen when it reaches vanishing point, which is not very far away. That is the basic problem: the contraction of what you might call the full-time professionals who not only provide a service themselves but are responsible for teaching, research and the training of more peripheral part-time pathologists who are currently in the majority. I have to say that I think the standards are beginning to decline because of this general wind-down."
We must address that problem. If we do not have high-quality, highly trained forensic pathologists, the quality of the service available to the police will be much reduced.
Finally let me deal with the whole question of what Professor Knight calls "waiting for Wasserman". In paragraph 427, Professor Knight says:
"It has got to the point where I would not say it is funny but "Waiting for Wasserman' is like 'Waiting for Godot', it has become a phrase in our sub-culture."
Mr. Wasserman is the chairman of a Home Office committee which, according to Professor Knight, had already been considering the matter for four and a half years when he gave his evidence on 4 December 1988. It is a little worrying when Governments use terms such as "shortly", "in the near future", "soon" and "this year." They use the worst possible excuses for the inadequacy of their response. An eminent professor of forensic pathology has pointed a finger at the chairman of the committee on which he serves. Surely, when that happens, it is high time that the Government looked into the matter.
The Government's response to the comment about the Committee chaired by Mr. Wasserman was wonderful.
The recommendation was clear:
"We recommend that the Working Party on Forensic Pathology should set a deadline for the production of its report to resolve without delay the short-term difficulties of the forensic pathology service".
That was a kind response to four and a half years of delay.
The rest of the Committee's response makes wonderful reading:
"The final meeting of the Working Party on Forensic Pathology took place in April 1989 and their report is now being submitted to the Home Secretary."
"Is being" is a wonderful phrase. The Home Office does not say "It has been submitted" or "It will be submitted", but "It is being submitted." That implies an endless chain of events and it is impossible to know what stage the
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process has reached. It is high time that we knew. I know that the Minister knows, and I am sure that he will tell us, when the report will be published. It is to be hoped that it will be before the end of this year—before the five and a half years have elapsed.
We are talking about an extremely important aspect of the ability of the police to ensure that the public have confidence in their ability to identify causes and find those responsible for crime. Without proper staffing, training and funding, the service will never be able to do the job that we so desperately need doing.
6.19 pm
Mr. David Ashby: It was a delight to be on the Select Committee that examined forensic science services. Its report was virtually unanimous, apart from one point about charging for services. Tht showed the great philosophical divide between Conservative and Opposition Members. Conservative Members believe that cost controls and cost management are essential tools of management. Everyone in management understands that point. If there are two companies in similar areas, both producing similar goods, but one producing them at a greater cost, in management terms it is right to be able to inquire into the reasons for it. Charging for forensic science services would help to do that.
Charging for the service, and applying cost controls and cost management, do not mean cutting the service. That applies to the National Health Service and various other services. Opposition Members believe in providing services without management finding out what services cost and how they can be more efficient. That is the great divide between us. The Committee's recommendations should be followed.
One cannot help thinking that the police force, which was founded in the 19th century, is still in the 19th century in management terms. It should be looking towards the 21st century. Our investigations revealed that we should have a unified police force or, perhaps, a force divided on the basis of no more than four regions. The chief constable of Leicestershire, my own chief constable, has said that he thinks there should be no more than 10 regions.
Why are we playing the numbers game? Mr. Birch, the chief constable of Sussex, suggested larger regions. Why 10? Why four? We are looking for a unified force. With the 43 local police authorities, we have seen a dissipation of resources, problems with promotion, resources, management teams, and a lack of co-ordination. When we point that out, we hear the reply, "We have a committee." It is wonderful to have committees, but they are not a substitute for a properly co-ordinated national police force.
Our report on higher police training at the police staff college at Bramshill highlighted a lack of clear direction about what we should do in the 21st century, in terms not only of a unified police force but of management. There seems to be no real direction for providing proper management in the police force. Management requires a high degree of expertise. Every organisation, both major and minor, trains its managers from an early age. The police force trains people in the best use of available resources, and how to make proper management decisions about priorities not only in their own service but in other aspects such as investigation. People are trained in the use

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of the forensic science service and in the necessary financial priorities. Why should the police force lack proper financial management in the forensic science service and other services? It is a proper tool of management.
When the Committee investigated the management structure of the police, it was surprised to find how deficient it was. We went to the Netherlands and saw that the future leaders of the police service were trained at an early age and in a positive manner. They are being taken on at about 21 years old, and even younger, and they are doing a four or five-year training course. I met a police officer who had been in the force for about 10 years. He was aged 29. I asked him what he felt about going to the special training course and training in management skills. He said, "I am too old. I am set in my ways. Yes, I will benefit and I will be able to achieve certain things, but I know that I am too old. I should have done this at a younger age."
One cannot help but think that we are doing too little too late in training police officers. We have police on a special course at Bramshill. That course is designed to identify those who have the potential to achieve the rank of chief inspector and to accelerate their promotions. It is a sandwich course over two or three periods with seven months' training at the college. That college training is also divided into two periods. The course focuses on the foundations of management skills, but it does not carry them through. An interesting point about the course is to be found at paragraph 75 to 78 of the report. Mr. Birch, who was also the director of the police extended interviews, identifies those who should go on the course. He said that there was misunderstanding and suspicion about the course and a failure adequately to promote it within the police service. It is vastly under-subscribed. Last year, of 3,196 provincial officers qualified to apply for the special course, only 463 chose to do so.
The problem is that there is a little of the "us and them" approach to the course. There is perhaps a sneering approach—"He has been on a special course," or, "He is very uppity. He is going on that special course." There is a failure to recognise that special courses provide rapid acceleration for someone who is capable of management skills and of making full use of his potential thereafter. Much of the problem is caused simply because we have 43 police authorities. Possibly, some authorities have individual approaches to the people who have been on such courses. Some do not appreciate the nature of those courses and the valuable contribution that people who have been on them are able to make.
Mr. Birch considered that recruiting officers sometimes failed to identify those officers with the potential to move to the senior ranks in the service. He said that there were variations in policies between forces and that that led to bewilderment amongst potential recruits and to a perception of the police service as unprofessional. That highlights the problems that result from having a number of different police forces, a problem which perhaps a uniform police service could take on board.
Mr. Birch also suggested that there was a need to examine ways of ensuring the selection of a sufficient proportion of recruits of higher than average calibre to provide a pool of talent for rapid promotion. He went on to suggest that the solution to the problem was the
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creation of regional police assessment centres from which chief constables would meet their recruiting needs. I do not know why he wants regional police assessment centres when he could have a central one which would do the job properly and better than centres in individual regions or areas.
Other hon. Members have pointed out that in Britain we have chief constables who are supposed to be in charge of large forces and that they require great management skills. Yet many chief constables have not attended senior command courses, some have not been on other courses and I dread to think that some might not even have been on a special course. Indeed, that is probably the case because of the special course timetable and the time at which it started.
A worrying aspect of our policing is that we have such an enormous organisation, taking the police as a whole, and that none of those top men have been on a course on which any large body would insist. Nobody in Shell or ICI would be at the top of such an organisation without having been on a type of Harvard school of management course.
But the police, who are in management—they are managing huge resources and large numbers of people in an organisation of great importance to the nation—do not go on any substantial management course designed to give their forces the managerial skill that is required. In that sense we are still in the 19th century.
We were impressed when we went to the Netherlands and saw them coping with this problem. We saw them training their managers at an early age for the great duties in their police forces that they would have to undertake. We saw that they realised the importance of that training. We must have a radical rethink of our police force if we are to bring it into the 21st century and make it the great force that we want and need.
6.33 pm
Mr. Barry Sheerman: At the start of a debate such as this, as one listens to the excellent contributions that are made, one is not sure what major themes will emerge at later stages and, indeed, whether there will be a thematic balance to the deliberations. Taken with the debate on policing in London that we had last week, it is clear that some common themes have been emerging.
It has been refreshing to hear the comments on those themes because if one can describe this Chamber as a state of the art debating chamber—perhaps we will become that in November—we have today witnessed the state of the art pointed towards certain themes. We on the Opposition Benches warmly welcome many of the proposals that the Select Committee have made. The Committee did an excellent job in pinpointing some of the problems that prevent us achieving the police force that the nation needs and deserves.
Having said that, it will come as no surprise to Conservative Members to learn that I shall make some comments of a somewhat more partisan nature. I promise that they will not be too partisan. Many comments have been made on topics that are familiar to us—about efficiency, effectiveness and management—and the hon. Member for Leicestershire, North-West (Mr. Ashby) made some good points about the training of managers in the police force and the need for good management.

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Comments have been made about the need for greater centralisation. That theme is touted a great deal when we talk of police matters. Although it is important to speak of efficiency and effectiveness—rather in the way people speak of motherhood and apple pie—when talking of efficiency and good management, I am not sure about the need for centralisation. Indeed, my hon. Friends and I prefer to dwell on some of the underlying themes, such as accountability and the tripartism that we believe has worked to a considerable degree in our police forces over many years. That healthy tripartism has brought the police authorities—that democratic element with an important role to play in keeping the police in touch with their grassroots—to focus on local opinion.
While my hon. Friends and I are pragmatic about having a degree of centralisation and about considering whether we should have this or that number of police forces, we are greatly against having a national police force, and we would not go down such a road with the hon. Member for Leicestershire, North-West.
Part of our review process has included the structure of regional government. It would be foolish not to consider the structure of police forces in relation to changing the nature of regional government. Accordingly, we would wish to consider the number of police forces at the same time as examining the regional structure. But no road that we went down would leave out the notion of strong democratic accountability about which we talked in the debate last week. Tripartism has served our police forces well, and we should not ignore that fact.
I have a mild criticism of the work of the Select Committee. As I read its report, there seems to be some neglect of the local authority point of view. Local authorities have a firm view and one would have expected the Committee to say more about local accountability and full participation. In other words, more notice should have been taken of evidence from the local authority angle. If that is not done, we can be out of balance in the evidence to which we listen, and our conclusions can, of course, be swayed by the evidence. That is a mild criticism, and I do not want to get it out of proportion.
One must bring the Home Office into the discussion when considering the common services of the police. One is in the position, as it were, of picking up a large stone in the garden and finding common police services beneath it. When one heard members of the Committee giving eloquent testimony to the appalling state of the higher police training centres and the police staff colleges, one was tempted to intervene and ask if they were still slopping out in those establishments.
Mr. Wheeler: Not quite.
Mr. Sheerman: The hon. Gentleman says, "Not quite," but it sounded as if the Home Office was responsible for rather genteel slums where it expected senior policemen to spend much time. If those establishments are not up to standard, it is the Home Office's responsibility. It should get its act together and provide centres of which the police can be proud and which give the right impression to the public. I believe that people react in a positive way to the right environment. It is possible that we behave in such a ritualistic way in the Chamber because, basically, we work in a museum. If we worked within a nice modern atmosphere, perhaps we would behave like civilised human beings most of the time.
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The forensic science service is another stone that I must congratulate the Select Committee on turning up. It has said that the forensic science service is pretty awful in terms of the morale of its staff and its expenditure keeping abreast of other expenditure in the police service. Many hon. Members will have learnt today that the forensic science service does not suffuse the whole of the police system. I am one of those people old enough to remember Marius Goring. I cannot remember the title of the show, but he played a forensic scientist who solved every case that came into his laboratory. I believe we still live in the days when we think that someone like Marius Goring will sort everything out. The Select Committee has shown that that is an out-of-date image. The fact is that the forensic dimension is not included in every stage of the training and retraining of our police force. Like many members of the Select Committee, I believe that forensic science must be built into police training.
My hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington) said that he believed that the forensic science service should be at the sharp end of police investigations. Forensic scientists should be working at the scene of the crime with the police and not waiting in their laboratories for samples and evidence to be sent to them.
I believe that we have done the great service of reminding the Home Office that it is in an indefensible position in that it has presided over a forensic science service with a lack of morale and expenditure—a disastrous combination. Some evidence has suggested that the police service and criminal detection are only as good as the forensic service. If that is the case, we have a great deal of ground to make up. I hope that the Minister will put on record his determination to make this top priority for expenditure. I hope that he will fight his corner with the Treasury and ensure that the expenditure comes through. After all, we are talking about £77 million for the whole of the common services, which is a tiny amount when the overall expenditure on the police is £3·5 billion.
The other aspect that I want to highlight is that common police services are and must be accountable. I was impressed by the Select Committee's report, especially on the ACOP secretariat, which is something about which the Opposition have been concerned. To some extent there has been a misrepresentation of what we disliked at the time of the miners' strike. I am perhaps striking a discordant note, but it is one that must be struck.
What the Opposition did not like about the ACPO secretariat—it was then called the national reporting centre, and is now called the mutual aid co-ordination centre—during the miners' strike was that there was no accountability. It was obvious to everyone that it was a national police effort—a national police force—that in many senses dealt with the miners' strike. If there had been accountability, the position would have been different. However, there was no accountability. The House could not ask questions of the Home Secretary because he was not responsible.
I know that I cannot have my cake and eat it, but I do not want a police system which is too centralised. Implicit in that is the building up of the ACPO role, but I want to build up that role with an accountability dimension, for which the Select Committee has come out strongly. I hope that the Minister will respond positively to that, because it goes to the heart of the good things proposed by the Select Committee.

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I do not agree with everything that has been suggested by the Select Committee. One or two of the proposals have some dangers. There are certainly dangers in setting up the new agency under which services can be charged—for example, telecommunications and forensic science services. I have said in my two interventions that I believe that there will be real problems if a charging mechanism is established before we have the forensic science service functioning correctly. After all, the Home Office has a very powerful research arm.
I have the greatest respect for the Home Office research unit. Select Committees are generators of ideas, good practice and recommendations, but they do not have all the answers. Select Committees, like any other committees, are subject to fashion and fad. However, it is the job of the Select Committee to make recommendations. It is then the job of the Home Office to take on board those recommendations and have them monitored. We must be pragmatic, but we must get the forensic science service in place and monitor how good it is before we think about ways of changing the structure and perhaps having a new kind of agency. The next task—the bread and butter task—of taking the forensic science service much more seriously, funding it properly and suffusing it with police services is a priority.
The move to strengthening ACPO must be made by improving its effectiveness. It may be that strengthening ACPO is not the right answer and that the common services must be strengthened in some other way. However, I support the move to try to strengthen ACPO first.
I welcome the Select Committee reports. They are a little bland in places, but by and large they are not bad. However, I urge the Government to recognise that they have turned over a couple of rather large stones in the garden with some nasty things underneath which need to be sorted out.
I urge the Minister to be cautious in taking any steps towards centralisation, a national police force or too small a number of police forces.
We believe that accountability is absolutely essential. As I said in last week's debate on the Metropolitan police, we want a police force that is efficient, effective and incorrupt. In a modern democracy, however, the police force must be accountable. If we could combine such efficiency with accountability and retain some form of tripartism, we would be much happier than we are now.
6.49 pm
The Parliamentary Under-Secretary of State for the Home Department (Mr. Douglas Hogg): I know that my hon. Friend the Member for Westminster, North (Mr. Wheeler) would like, with the leave of the House, to make some concluding remarks, and for that reason I propose to confine my remarks to approximately 15 minutes. That means that I will be unable to take an overview of what has been said; I hope that the House will forgive me for that. I shall seek to reply to a number of specific points that have been raised by hon. Members, but I hope that hon. Members will forgive me if I fail to reply to them all; certainly no discourtesy is intended.
I echo what has been said by the hon. Member for Huddersfield (Mr. Sheerman). The House is grateful for
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the reports before us, for the careful work that the Select Committee has put into its inquiries and for the careful way in which its recommendations and comments have been marshalled. Most certainly valuable work has been done and valuable recommendations have been brought forward. The attention of the House and of the Home Office have been focused on issues to which, perhaps, we have not always given sufficient attention in the past.
I want to refer to a number of specific questions about the police college at Bramshill, the status of ACPO and related matters. I agree with the view expressed by the Select Committee that the police college should remain at Bramshill. The House may remember that, some time ago, I had departmental responsibility for the police service. I no longer have that responsibility, but when I did I visited Bramshill on several occasions and I was greatly impressed by the fabric of the building and by the work done. It would be a pity for the police college to move from Bramshill. I can reassure the Select Committee about its location.
Two issues flow from our discussion of Bramshill, one of which is accommodation. It is true that, in some respects, the accommodation is deficient, and clearly we need to contemplate a programme for upgrading the accommodation for staff and for students.
My hon. Friend the Member for Plymouth, Drake (Dame J. Fookes) asked whether it would be possible to enhance the provision made at Bramshill for overseas students. That suggestion will be considered, but it is important to remember that, the college is primarily for this country's police service. Any increase in the provision for overseas students should not be at the expense of the provision made for our country's police service.
A further point that has been raised in a number of different contexts is whether it would be sensible or possible to use proceeds from the Drug Trafficking Offences Act 1986 to finance any of the police service, in particular Bramshill. My hon. Friends the Members for Drake and for Ryedale (Mr. Greenway) also raised that point. I have responsibility for drugs policy in the Home Office and that question is raised more directly in the context of that policy. We have not yet come to a concluded view upon this matter.
The House may recall that about three weeks ago we had a debate on drugs. I then raised the possibility of setting up a central fund, not financed directly from the proceeds of drug trafficking, which could be used by individual police forces in certain circumstances. We have not come to a final conclusion, but that fund is an aspect of the debate about this matter. There is a reluctance, I think rightly, to use the proceeds of a specific source of income for specific purposes. Historically, that has been the attitude of the Treasury and it is one with which I have some sympathy. The Government and the Home Office are, however, considering whether any part of police expenses could be met, at least in part, from the proceeds of the 1986 Act. We have come to no conclusion, but in the context of our consideration I shall take into account the comments that have been made today and the recommendations of the Select Committee.
Some interesting comments have been made on the status of Bramshill in the context of a police career and on the status of ACPO. It is undoubtedly true that a number of senior officers of ACPO rank have reached that position

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without having gone through the senior command course. As a general proposition, I believe that that is a pity, as all officers would benefit from participation in that course.
My hon. Friends the Members for Drake, for Westminster, North and for Ryedale suggested that participation in the senior command course should be a condition precedent of appointment to ACPO rank. We do not have a concluded view on that matter and we would certainly wish to undertake discussions. We are, however, giving it consideration and we shall consider it further against the background of what has been said today and against the recommendations of the Select Committee.
My hon. Friend the Member for Westminster, North, among others, suggested that the ACPO secretariat should be strengthened. The Government have accepted that Select Committee proposal in principle and we are now considering the financial questions that flow from such a decision. My hon. Friend the Member for Westminster, North also suggested that ACPO ranks should be a Home Office central grade—that suggestion was supported by my hon. Friend the Member for Ryedale. It is an interesting proposal, which would represent a major change of policy.
Mr. Wheeler: Quite so.
Mr. Hogg: I gather from that that there is not only support for a major change of policy, but a recognition that it would involve a major change of policy—both things must he kept in mind. We have not yet come to a concluded view on that particular recommendation.
Mr. Sheerman: Why not?
Mr. Hogg: Because it requires careful consideration and discussion. We shall, however, consider that proposal against the background of today's debate.
The Select Committee recommended two things regarding the status of ACPO and in particular of its committees: first, that it should be given formal status, and secondly, that it should be made accountable. Such accountability would be different from the existing accountability to which the officers are subject. The component officers of ACPO are already accountable, although they are accountable not to some central agency but to the individual forces from which they come and the police authorities that preside——
Mr. Worthington indicated dissent.
Mr. Hogg: The hon. Gentleman shakes his head, but those officers are accountable to their forces.
Mr. Worthington: I find it difficult to see how they are accountable, when each chief constable is a law unto himself and is responsible for the operational policing of his area. In that respect, there is no accountability.
Mr. Hogg: The hon. Gentleman takes too narrow a view. ACPO contains not only chief constables, but deputy chief constables and assistant chief constables, and those lesser ACPO ranks—if I may so describe them in shorthand—are accountable to the chief constable. In a broad sense, the chief constable is accountable to the police authority. He is not accountable in a detailed, operational sense, but in a broad sense he is, because the authority—subject to certain provisions, checks and balances of which the hon. Gentleman knows—has the power to dismiss him.
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Officers in ACPO are accountable to a variety of different authorities, and the question is whether that accountability is adequate. That question must be considered and that was recommended by the Select Committee. However, the proposed change—that we should recognise what is now a staff association as a formal body, and make its component parts responsible and accountable to a central agency—is a dramatic one, upon which we have not yet come to a concluded view.
When I was involved in the police service in the Home Office, I was troubled by the fact that participation in Bramshill did not always advance a police officer's career. I sometimes felt that there was a reluctance on the part of officers within forces to come to Bramshill, either to participate in courses or as instructors, because they feared that doing so would not receive sufficient recognition from their sponsoring force, and particularly from their sponsoring chief constable. We must come to terms with this matter, and police authorities, particularly chief constables, must recognise that the experience of Bramshill plays an important part in a police officer's career development. I attach a high importance to Bramshill.
The forensic service, quite rightly, figured largely in the debate. Charging has been the subject of much debate. The Committee recommended that the funding of the forensic service should be switched from common police services to a charge on individual police forces, based partly on capitation and partly on direct charging. The arguments for that were eloquently put by my hon. Friend the Member for Drake. I recognise that the hon. Member for Clydebank and Milngavie (Mr. Worthington) does not wholly subscribe to them, but, on the whole, I find them persuasive.
Charging is a better way of determining the allocation of resources, both financial resources and the forensic facilities available. In addition, a chief constable who, under the revised system, would have to fund the process of charging, should have that discipline imposed upon him when he has to decide how best to conduct an inquiry. However, I also realise that there are a range of problems involved; accordingly, work is now in hand to discover to what extent, and how, we may carry the plan forward. We intend that any new funding arrangement should be in place within the next three years, if possible by April 1991.
Manpower is a subject which has been much debated this evening. As the House will know, we are already committed to bringing the service up to complement. It is now about 23 under complement, and over the next two years we shall recruit an additional 28 officers. The Committee took the view that a greater expansion in manpower was required. We shall certainly consider that recommendation. We need to come to an assessment based on cost benefit and the financial implications.
On the subject of agency status, the House will know—
Mr. Worthington rose——
Mr. Hogg: I am anxious to complete my speech, as I would like to let the Chairman of the Committee make some final remarks.
The House will know that my right hon. Friend the Home Secretary has announced that the service is a suitable candidate for agency status.
I think that my hon. Friend the Member for Uxbridge (Mr. Shersby) raised the issue of the working part) report

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on pathology. I am pleased to say that it will be produced later this month—I think that phraseology will be acceptable to the hon. Member for Gower (Mr. Wardell).
I am conscious that I have not answered all the questions raised, and apologise for that. However, it was not possible to do so because I, and I am sure the House, would like to let the final word rest with the Chairman of the Committee, who has presided over such a valuable series of reports.
7.7 pm
Mr. Wheeler: With the leave of the House, I would like to bring this important debate to a conclusion. May I say on behalf of the Home Affairs Committee that this has been a valuable three hours which has enabled us to explore in greater detail on the Floor of the House some important issues and to discover the consensus which exists in the Chamber as a whole.
The Committee fully understands that my hon. Friend the Parliamentary Under-Secretary of State was unable to be definitive in his reply to some of the points raised in this debate and to many of the recommendations that the Committee has presented to the House and the Home Secretary. We fully appreciate that some of those recommendations are substantial—even controversial—.and require careful consideration. But we are grateful to the Home Secretary and to the Home Office for the work which they are doing in analysing our recommendations and the evidence which supports them.
In this debate this afternoon, no fewer than five Committee members have had the opportunity to present their own points of view and to discuss the Committee's reports. Three other hon. Members, whom I might describe as outsiders to the work of the Committee, have been able to make a very worthwhile contribution, for which the Committee as a whole is most grateful.
In the one or two moments which I have left, I shall simply touch upon some of the key points. I imagine that for us all, the central theme of this afternoon's debate has been effectiveness, efficiency and accountability. It is common to both sides of the House that we wish to see those three cardinal principles in our police system in the United Kingdom and, particularly in England and Wales. Therefore, I share many of the views of the hon. Member for Huddersfield (Mr. Sheerman) who spoke for the official Opposition. We found that there is much in common, although there are differences—perhaps about the nature of the structure of the police service in England
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and Wales. As is well known, I tend to favour central services through the common police services which are accountable and well organised, and I see the development of a regionalised police system in England and Wales. There may be differences here, but there are also common strands.
I thought that the hon. Member for Clydebank and Milngavie (Mr. Worthington), who is such a fine ornament upon the Committee, made a splendid comment when he suggested that research was essential to analysing the value of the forensic science service, which is a point that the Committee has made.
My hon. Friend the Member for Plymouth, Drake (Dame. J. Fookes) made an admirable contribution about charging for the forensic science service and put that case in a nutshell, for which I was most grateful to her. She also emphasised the value of Bramshill to overseas students. This is of particular importance in our fight against international drug trafficking, because we are able to bring people from other police services into our police college to understand our philosophy and the advantages that go with it.
My hon. Friend the Member for Ryedale (Mr. Greenway) made a memorable contribution when he analysed the role of ACPO and its work. He raised the interesting proposition of a central support committee—something to which I am sure we would wish to give further consideration.
The hon. Member for Derbyshire, North-East (Mr. Barnes) raised the issue of disaster planning for emergency services. It is possible that the Committee may want to give further thought to that, too.
On the whole, this has been a valuable debate and the House has greatly profited from it.
It being three hours after the commencement of proceedings on the motion, MADAM DEPUTY SPEAKER interrupted the proceedings.
The Question necessary to dispose of the proceedings was deferred, pursuant to paragraph (4) of Standing Order No. 52 (Consideration of Estimates).

ROYAL ASSENT
Madam Deputy Speaker (Miss Betty Boothroyd): I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified Her Royal Assent to the following Acts:

1. Control of Pollution (Amendment) Act 1989.

2. Water Act 1989.

3. Wesleyan Assurance Society Act 1989.

ESTIMATES DAY
  Class V, Vote 2

    Information Technology
    [Relevant documents: First Report from the Trade and Industry Committee of Session 1988–89 on Information Technology (House of Commons Paper No. 25), the Government's White Paper on Information Technology (Cm. 646) and the Minutes of Evidence taken before the Committee on 26th April 1989 ( House of Commons Paper No. 338-i).]
    Motion made, and Question proposed,
    That a further sum, not exceeding £322,022,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges which will come in course of payment during the year ending on 31st March 1990, for expenditure by the Department of Trade and Industry at its research establishments (including the National Measurement Accreditation Service) and on the running costs of certain of its headquarters divisions, in its radiocommunications division and the Patent Office, support for industry (including industrial research and development, education, training, design, quality, marketing, management best practice and standards, business development and aircraft and aeroengine research and development), space technology programmes, protection of innovation, international trade (including export promotion, trade co-operation and international exhibitions), enterprise and job creation (the inner cities initiative and city action teams), miscellaneous support services, grants in aid, international subscriptions, provision of land and buildings, loans, grants, and other payments.— [Mr. Forth.]
    7.11 pm
    Mr. Kenneth Warren: I declare an interest in the subject for debate, having been associated with the information technology industry since before entering Parliament.
    Our reason for selecting this subject stems from a decision in December 1987 to inquire into information technology. It was in particular the hon. Member for Warrington, North (Mr. Hoyle), who apologises for not being able to be with us, who conceived the idea of the debate, based on the growing worry about this country's trade deficit in information technology goods. It was big then, it is bigger now and it is growing remorselessly larger.
    The subsequent hearings that we held throughout last year culminated in a report published in December; three months later we received a White Paper from the Government.
    The White Paper was eagerly awaited. Unfortunately, when it arrived it was somewhat misleading. I am sure that my hon. Friends who served on the Committee will enlarge on the problems that we encountered.
    We were aware that the DTI had misunderstood the report's axes of argument, and its acceptance rate for our 52 recommendations was only 28, which is not as high as we are usually awarded when we place a report before Parliament to which the DTI then responds. Perhaps the Department would have preferred us to consider petrol prices at the pumps—we considered that as a subject for
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    debate—or shipbuilding: the Government seem to give aid to private shipyards which is not available to the nationalised yards. Or we might have called for a popular debate on beer and the tied houses, but we stuck to information technology because I had called for a debate on it in Government time, but unfortunately the Leader of the House could not see his way to giving us one.
    It is interesting to read in The Independent today that its technology correspondent, Mary Fagan, draws attention to a document which came from inside the DTI which states:
    "Internal briefing papers told DTI officials to resist a Commons debate"
    on information technology.
    We have this debate in our time now and we look forward to exploiting the two hours and 48 minutes that are left——
    Mr. Michael Marshall: I fully understand my hon. Friend's point about the importance of the debate. On behalf of the parliamentary information technology committee I may say that we greatly value the thorough work that went into this report, and I assure my hon. Friend that we shall continue to help him in any way we can to further the debate in the coming weeks.
    Mr. Warren: I am most grateful for that support from the chairman of the parliamentary information technology committee which does so much useful work on behalf of the House and the industry.
    We have had tussles with the DTI before on tin and on Westland, when we held inquiries, but in general it may surprise the House to know that we reached broad agreement on the proposals that we made on British Steel, on the Rover Group and on trade with China, eastern Europe and so on. Unfortunately, the information technology problem remains, and our unanimous proposals have been misinterpreted.
    These proposals were arrived at after a year—long presentation of the most skilful evidence from across the industry, collected by the Committee in Europe, Japan and the United States.
    I could not resist bringing to the attention of the House a quotation by my hon. Friend the Parliamentary Under-Secretary of State for Industry and Consumer Affairs, who waited until the Select Committee was safely over the border in Scotland to look at financial services for 1992 before saying:
    "This old-fashioned idea of the gargantuan dinosaur of Government, directing the sector by procurement policies, is … typical of Select Committee members but not modern Government policy."—[Official Report, 19 April 1989; Vol. 151, c. 385.]
    It is a pity that my hon. Friend said that, because I am sure that he has since had a chance to read the report—clearly he had not read it at the time. No doubt he will be pleased to know that the Select Committee is eagerly looking forward to the chance of welcoming him with its usual courtesy, as soon as it can.
    We also welcome my hon. Friend's self-announced appointment to his post. Our right hon. and noble Friend in another place said that there would be no Minister of information technology but at a recent press conference, our hon. Friend the Minister told us:
    "I am your friendly Minister of IT".

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    We did not ask for a Minister of information technology, and the noble Lord did not expect one to be appointed. We hope that this self-appointment will survive any future shuffle.
    I have always regarded my hon. Friend in good heart as a man who can be relied upon to pour oil on troubled waters. I note that he is not wearing his usual admirable watch chain, perhaps knowing that it has a dry tinder box attached to it. Nevertheless, I could not let the moment pass without-telling my hon. Friend that the Committee was not happy with his view, which I am sure he will want to amend if he catches your eye, Madam Deputy Speaker.
    The report contains two main themes. No one knows better that my right hon. Friend the Paymaster General, whom I welcome to the debate, that Government as a business operation need information technology on a scale that they do not yet appreciate. Secondly, the United Kingdom trade deficit is the cause of growing national concern and it cannot be wished away by selective statistics.
    The business of Government is labour-intensive—it is probably the most labour-intensive business in the country. Two of the tables in the report show the number of civil servants with computer workstations, and how many will have them in 1993. Table 12 shows that the major Departments of State have about 0.3 workstations per civil servant. By 1993, that will have risen to an average of 0·5.
    The best current practice is between 0·5 and, in the most advanced offices in private enterprise, 1 per person. The Government need to bring in a lot more technology because they face a major problem that they have not yet dealt with. Between now and 1993 the total number of people in the 18 to 24 age group, which is 6 million now, will drop to 4·8 million—a fall of 20 per cent. in potential recruits. Although I trust that the Conservative Government will continue to prosper through those years, I fear that they will not find themselves the most attractive employers for young people who will be the subject of intense competition in efforts to drag them away into highly paid jobs in other industries which can afford to pay more than the Government.
    The only solution, with which the Government must come to grips, given the labour-intensive nature—
    Miss Emma Nicholson: Why is my hon. Friend concentrating so hard on the under-24-year-olds? Information technology is eminently suited to the recruitment of middle-aged people, particularly women who work from home or part time. Government are part-time employers of notable success, and they offer job sharing and good working practices. It would be easy to train those over 24 in modern IT, which is so user-friendly, so why does my hon. Friend concentrate so heavily on the younger age group?
    I am concerned that the percentages to which my hon. Friend has referred may be slightly misleading. I refer especially to computerisation within Government and workstations. My hon. Friend will recall the central head office technology system which is being introduced to the Ministry of Defence, which is commonly known as CHOPS. With its introduction there will be 75,000 terminals. There will be a terminal on each senior manager's desk. My hon. Friend will——
    Madam Deputy Speaker (Miss Betty Boothroyd): Order. The hon. Lady is making a long intervention. I am sure that she will catch the eye of the Chair in due course.
    Mr. Warren: I am grateful to my hon. Friend for her intervention, and especially for the information about the Ministry of Defence. When the Committee asked it how many computer workstations it had, its first response was to tell us that it did not know. Secondly, the Minister told us that it could not give us the information because it was secret. I was inclined to think——
    Miss Nicholson: Will my hon. Friend give way?
    Mr. Warren: If my hon. Friend will forgive me, I shall proceed with my speech. I am sure that she will be able to catch the eye of the Chair later in the debate. As I have said, I am delighted to have the information about the Ministry of Defence to which she drew our attention. I still feel, however, that it did not know how many computer workstations it had.
    I accept my hon. Friend's argument about the age group that I have selected, but I want to illustrate a problem that must be regarded as inevitable. There will not be enough people entering the labour market in the next five years to take up the job opportunities that will be available. I accept, of course, that there are job opportunities that involve the use of information technology throughout the age ranges. I wish that I could stand with my hon. Friend and believe that IT is all user-friendly. My experience is that it is usually antagonistic when I am using it. That is probably the result of bad luck over the years.
    I draw the attention of the House—I hesitate to do this after my hon. Friend's intervention—to yet one more table in the report. It will be the last table with which I shall burden the House. It sets out the number of personal computers that are available in the home. It shows that Britain has much greater experience of the use of personal computers, whether they be for home use, for a hobby, for business or for scientific work, than America, Spain, France, West Germany, Italy and Sweden, for example.
    That takes me again to the 18 to 24-year-olds and the problem that the Government will have in recruiting young people to fill the job opportunities that they will have. The people in that age group will expect information technology to be commonplace. They will be used to playing around with keyboards and screens and they will expect to be well equipped with information technology when they take up employment. I believe that the Government will have an even more difficult recruiting task than perhaps they have appreciated and identified so far.
    It is true that we do not work at home, and I do not suggest that any Member of this place, let alone my right hon. Friend the Prime Minister, would wish to do so. I ask the Government, however, to examine more closely and severely the communications systems that are available in the market place and to bear in mind those that will be coming forward. The Macdonald committee, the members of which were not in business or in industry, advised the Government on communications. It even stated in its report that it did not choose to discuss the matter with those who are in industry or in communications.
    That is disappointing. It is communication systems in which the greatest use of information technology must be found and developed over the next 10 to 20 years. I have

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    a personal desire to see a wide band communication system developed that can take voice and data so that the country can be as competitive as it needs to be in developments that go beyond 1992 for use in the financial services sector, for example.
    Miss Emma Nicholson: Will my hon. Friend give way?
    Mr. Warren: I hope that my hon. Friend will forgive me if I choose to continue with my speech. I am sure that she will catch the eye of the Chair in due course.
    Miss Nicholson rose——
    Mr. Warren: I give way to my hon. Friend.
    Miss Nicholson: I remind my hon. Friend of Britain's enormous success in using the Packet switching system to such effect through the introduction of Mercury, which has brought competition to British Telecom. We now have one of the largest customer databases and international data transmissions in the world. We have been enormously successful with British Telecom and Mercury in the use of the Packet switching system, and this has brought exactly the result that my hon. Friend is seeking.
    Mr. Warren: With respect, it has not. It does not allow for the sort of communication systems that will be required in the next decade in Britain and throughout the rest of Europe and the western world. The fact is that it is not a wide band system. I shall be more than delighted to give my hon. Friend a private lecture on the subject on another occasion. I hope that she will accept for the moment that the problem is that we do not have communication systems that are adequate to meet the expectations of those who want to compete—whether they be in Scotland or Ireland—with the rest of the European community.
    In today's edition of The Times there is a fine article that draws attention once again—this has been repeated over and over again in the national and technical press—to the number of skilled employees that will be required. The National Computing Centre Ltd. believes that the present shortage of 19,000 staff will rise to over 35,000 within a year. We are talking about those who are well skilled and well trained in the art of information technology. It must be recognised that it is an art and not only a science, especially when the proverbial bugs are running around inside the equipment.
    We have a trade deficit problem and it is not confined to information technology goods. It is an enormous problem that stretches across manufacturing industry. The deficit is running at £17,000 million a year. I worked out late last night—I hope that I got the zeros right—that it amounted to about £50 million a day, or £33,000 every minute around the clock. To offset that, we shall have to export and sell six more Metros a minute.
    The two major components of the trade deficit are, surprisingly enough, German motor cars, which account for about £5 billion-worth of imports a year, and information technology, the imports of which amount to about £2·5 billion a year. In third place is the importation of material that is required by the paper industry. We have a major problem and the Committee sought to adress it. It is one that cannot be wished away by selective statistics. It is an enormous problem and it does not matter what other countries are doing. It can be mastered, however, by the talents and resources that are to be found within the
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    United Kingdom. That could be done if I could only persuade the Government to be drawn into collaborating, co-operating and seeking to close the gap.
    I ask the Government to examine their track record. When the Committee tried to identify the Government's work in this area, it was disappointed to find that reports such as that produced by the Bide committee in 1986 received no response. One of the recommendations was that work should be undertaken on a fail-safe system for British Rail. If that recommendation had been adopted in 1986, some of the recent rail crashes—I do not like to speculate—might have been avoided. That applies as well to some that might yet come. To reject the work of so many over such a long time is not conducive to persuading more people to come forward to collaborate with the Government on inquiries which they may wish to initiate.
    The reaction to the Committee's report has perhaps been better than the reviews which the Government were prepared to give us. I shall refer to some of them. The Cranfield Technology Institute stated:
    "We support each of the 52 recommendations."
    There was a response from IBM, which read:
    "I … congratulate you on the accuracy with which you have pinpointed the most critical issues."
    The Electronic Engineering Association commented on an
    "able, interesting and well-written document on the current state of the IT industry in the United Kingdom."
    The professor of computing at the university of Kent reported:
    "I was pleased to read that the Committee was trying to shake up the system."
    We are still trying to do that.
    The Hoskyns Group said:
    "Excellent … the task now is to ensure that the report is not buried alongside Bide and Coopers."
    The British Computer Society said that the report
    "gives Government a real opportunity to simultaneously improve the effectiveness of its own operation and the performance of United Kingdom industry."
    The comment that I really like, Madam Deputy Speaker—and I am sure that it will appeal to you—comes from the female managing director of a computer company which my right hon. Friend the Prime Minister visited. She said:
    "I don't know if she will go back and give the DTI a handbagging about the report … but I feel she should."
    When my hon. Friend the Minister replies, we shall find out whether he is suffering from the slings and arrows of outrageous handbags.
    The Government's track record is not a happy one. The National Computing Centre was asked by my right hon. and noble Friend the Secretary of State if the report would give him some idea of skills requirements for several years hence. The industry had invested £100,000 of its own money in the report, which was started in January 1986, but no reply has been received. The DTI may well run into some difficulty with those who are anxious for a partnership to develop with Government if nothing happens after all their efforts. We had high hopes that the report and the White Paper would guide us towards a partnership that needs both the help and the interest of Government and that looks upon Government as a major customer.
    The Committee's work was not to pick winners or losers. Nevertheless, the PA Consulting Group—which is used extensively by the Government—said in a report entitled "Winners or Losers":

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    "No one seems to know what to do as far as IT is concerned".
    An article in "The Management Edge" by David Harvey stated:
    "Corporate systems in two thirds of UK companies will not withstand the competitive strains imposed by the single European market. The warning comes as the countdown to 1992 reduces the room for any serious preparation to be carried out."
    Because of the downturn in engineering orders this year, the Government—who are a major market-maker—must tell us what they propose to do. They say that they will not intervene, but I could list several Government interventions by the DTI, beginning on 8 February. For a Department that does not want to intervene, it is a remarkable somersault. Its most amazing intervention—of which I happen to approve—occurred on 19 June when it launched the open systems technology transfer programme at a cost of £12 million. In doing so, it must have picked a winner. It could have picked another one, but it did not. Of course, I cannot refer to the winner because that would be unfair to the loser. To my regret, during the past few years in information technology there has been a remarkable propensity, especially by the Ministry of Defence, to pick losers—to the tune of £1 billion in a recent project.
    The Government cannot claim that they are not in the business of picking winners when not only do they pick a winner but they spend £1·8 billion of taxpayers' money each year to sustain their IT requirements. The black knight of intervention has stealthily come among us. That is evident in the recommendations of the report that have not been accepted. Time and again we can enumerate and cross-check interventions against the report's recommendations, although those recommendations have not been accepted in the White Paper. I feel that there has been, perhaps, a slightly sinister change of policy.
    A report in the Financial Times on 26 June by Mr. Alan Cane stated:
    "Concern that British computing services companies are not yet geared to competing successfully against foreign companies for large contracts has prompted a Government `initiative' that comes close to contravening the spirit, if not the letter, of international directives on open competition."
    Companies are being invited to receive quiet, informal advice from the DTI. One of the bidders is quoted as saying that the DTI
    "is saying that they will put extra votes your way for an all-British consortium."
    Neither my hon. Friend nor I is an interventionist, but that is something of a volte-face by a Government who, apparently, do not believe in intervention but who, in fact, are surreptitiously encouraging it. Companies are being encouraged to discuss their bids with the DTI and the CCTA, which in turn will give information to help them win contracts. That is a change of policy. I am not saying that that is wrong, but the Government's policy on intervention should be publicly stated.
    I know that many other hon. Members wish to speak in the debate, Madam Deputy Speaker [Interruption.] I have known you for a long time, Mr. Deputy Speaker, and I really did not expect to see you clad in such a manner. You will no doubt understand my problems in Committee when hon. Members laugh at me—although it is normal to laugh at the Chairman.
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    The task of developing IT understanding is colossal, but it is something from which the Government cannot escape. I welcome collaboration provided that it is creative and promotes Government understanding that they cannot avoid being a player in the market place. It may sound like Powellite philosophy, but the Government say that they will not intervene in the buying decisions for £1·8 billion equipment, yet they are buying between 10 per cent. and 20 per cent. of total output for their own civil and military uses.
    The Government and the DTI do not have to set themselves up as judges on the merits of the people and the products in the IT marketplace. However, they must understand that their process of choice is antiquated and expensive. Indeed, major suppliers say that it costs them three times as much and takes them three times as long to bid to Government as it does to comparable outside enterprises. Because the Government are the largest single buyer, spending billions of pounds each year, their choice affects the operation of the market place.
    I have a rather worrying personal concern that in a country built on talent and surrounded by opportunity the Government do not recognise their unique duty of leadership by constantly seeking to open new areas of prosperity for our nation. That is the inherent challenge of the Committee's IT report and the reason that we have selected it for debate tonight. We want the Government to accept their duty and to act. I hope that my hon. Friend the Minister will respond with understanding.
    7.38 pm
    Mr. Stan Crowther: I am happy to follow the Committee's distinguished chairman, the hon. Member for Hastings and Rye (Mr. Warren). He has not left a great deal for other Committee members to say. I appreciate the splendid way in which he advanced the Committee's views.
    Because of the short time available for this debate, I shall be brief—although I intend to concentrate on a matter of crucial importance to British industry. I felt that the hon. Gentleman was displaying his customary generosity when he suggested that the Government had misunderstood the Committee's report. The alternative is that they understood it perfectly well, but reacted in an extraordinarily stupid way. It may be that they have misunderstood it. Perhaps I should be as kind as the hon. Gentleman.
    The Select Committee spent a vast amount of time on the inquiry. There were 15 sittings in the House and we took many thousands of words of written evidence as well. We travelled around the world talking to people in Japan and all the way across the United States. We then produced a report containing 52 recommendations which was warmly welcomed by the industry. The hon. Member for Hastings and Rye has quoted a few of the comments that we have received from the industry, but they are merely a few out of a vast number of comments that we have received, all extremely complimentary to the report. Unfortunately, the report was dismissed peremptorily by the Secretary of State. It is sad that he should have reacted in such a way.
    I emphasise that the report was unanimous. Every member of the Committee agreed with every recommendation in it. I do not intend to deal with its technical

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    aspects—other hon. Members are much more qualified than I am to do that—but I want to make one or two comments on the political aspects of this matter.
    This is not a matter of party division. Again, I emphasise that the report was unanimous. The argument between the Select Committee and the Secretary of State on this matter goes to the heart of the ideological divide in British politics today. It is entirely a question whether a British Government have a duty to make decisions and to implement policies which are positively in the interests of British industries and British companies.
    This is the only Government in the industrial world who make a virtue of neutrality in that matter. They are certainly the first Government in British history who have taken the view that it does not matter whether British industries sink or swim and that it is nothing to do with them. I know of no previous Government of any party who have taken that view, but that seems to be the well-established policy of successive Secretaries of State for Trade and Industry, of whom we have had a large number in the past 10 years—about eight.
    Those Ministers have all claimed a great attachment to what they call market forces. I am not against market forces, but we need to remember that market forces do not come down from heaven. They are not created by some extra-terrestrial body. They are very much created and conditioned by Government policies—for example on energy costs, interest rates, exchange rates and, in the particular context of the matter that we are discussing, public procurement.
    Let me refer briefly to the Government's response to our report on that matter of public procurement. They said:
    "The Government do not consider that public procurement should be used as a policy instrument to pull through technology."
    We never suggested that it should be an instrument to pull through technology. All that we were suggesting was that in their public procurement policy it would not be a bad thing for a British Government to pay some attention to British industry. That may have been a misunderstanding, but if it was it was a serious one.
    Government policies on matters such as education, training and research in the area that we are debating are of enormous importance in conditioning what turn out in the end to be market forces. For example, no one can seriously dispute that the success of the United States IT industry in the civilian field owes a great deal to the enormous amount of taxpayers' money which the Department of Defence spends on research—a perfectly proper use of the taxpayers' money. I am not necessarily suggesting that the Ministry of Defence should adopt the same policy here; I merely mention that as an example of the way in which Government expenditure can be used to benefit the economy, obviously including the private sector.
    Those are ways in which market forces are determined by the use of Government policy and resources, and I would like to see that happening here. However, the Government's response to the report, effectively saying that that is not their job and has nothing to do with them, is unfortunate.
    The Ministry of International Trade and Industry in Japan clearly, openly and obviously devotes its policies entirely to the promotion of the Japanese national interest. Nobody makes any secret of that. If the Japanese have
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    tended to open the Japanese market to foreign imports more than they have in the past, it is only because they perceive that to be in the Japanese national interest.
    In the highly competitive world in which we live, I see nothing wrong in any Government adopting that policy. But the British Government's attitude, as we perceived it during the inquiry, as during many other inquiries, is that, although they want British industry to make the best possible use of information technology, it does not matter much to them where the equipment comes from; whether it is made in Britain or imported. They do not care much about the future of Britain's indigenous IT manufacturing industry. The hon. Member for Hastings and Rye pointed out the appallingly high trade deficit in that area. We and the Government should be worried about that.
    The Government have said that they are not prepared to make use of their enormous purchasing power to assist in and encourage the development of the British IT manufacturing industry. They are wrong to say that. I hope that they will think again about what we have said in our report. Again, I emphasise that this is not a matter of an ideological difference between parties. The report, like all our reports, was unanimous.
    I do not want to be told about our international obligations under EC rules, the general agreement on tariffs and trade and all that kind of thing. I see that the Minister nods, so I fear that I may be told about it. lest I shall be told about it, let me say at once that I have heard it all before. I also know that other Governments, who are similarly bound by identical rules, manage to find a way of protecting the interests of their own industries and of making sure that their own industries develop in the competitive world in which we live.
    I never quite understand why we should be the only ones who say that there is nothing we can do because of the international rules. When we talked to people in Japan, the United States and throughout western Europe—yes, even in the EC—we found a very different attitude. The Minister knows perfectly well that there is not another Government in western Europe who will sit supinely back and see its own industries destroyed by competition from outside if there is something that can be done about it. There is something that the Government can do, but I am afraid that they are refusing to do it.
    Where there is a will there is a way and it is up to the Government to find the way. It is time that we had pro-British policies from the British Government.
    7.48 pm
    Sir Ian Lloyd: I am glad to hear that the hon. Member for Rotherham (Mr. Crowther) has joined the comparatively select band of those who have been to Japan, the United States and elsewhere in Europe to look specifically at the information technology industry. Rather like those astronauts who go into space and never see the world in quite the same way again, hon. Members who have shared that experience never quite see the problems in exactly the same light again.
    This is an old stamping ground of mine, but I feel something of an interloper in what is a vital and important argument between my hon. Friend the Member for Hastings and Rye (Mr. Warren) and my noble Friend Lord Young representing the Government. The hon. Member for Rotherham has touched on the crucial and sensitive aspects of this vital debate.

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    I am indebted, as I am sure are the House and the country, to my hon. Friend the Member for Hastings and Rye for having produced a remarkably comprehensive and interesting report which deserves, and I hope will continue to receive, the closest possible scrutiny. I have read not only the report but the Government's White Paper in response to it. Before commenting on both, I think it fair to say that the interchange between Select Committees and the Government provides a crucial fulcrum on which the balance between Government policy and the views of its critics can be weighed. It is very much in the public interest that that should be done seriously and openly, as it is this evening on the Floor of the House.
    I congratulate the Government on responding positively and constructively to certain parts of the report. On reading the White Paper, I particularly welcomed the recognition in paragraph 5.14 of the significance of the international trading market. Recalling the remarks that had been made about Japan, I never forget for one moment that whatever may be Japan's success on one side of the coin, it depends on the other side of the coin, which is the virtually completely free access that Japanese products have to the OECD world trading market. Neither the Japanese nor anyone else should be allowed to forget that. Therefore, I welcome also the Government's emphasis on the general agreement on tariffs and trade and on access to international markets. Whatever happens, it is important that our policies result in such access.
    Before giving my critical reactions, I shall set the scene. Since I last spoke on the subject—which was quite a while ago—the cost of semiconductors per function has fallen by 75 per cent. It has fallen by half since the report was printed. The size of the information technology deficit has increased enormously and the scale of the IT industry in the United Kingdom, in Europe and worldwide has expanded at a prodigious rate. The world economy now benefits to the tune of the massive figure of 400 billion dollars. About 15 years ago, I said that by the end of the century, IT would be the world's largest industry. Now I believe that that target will be exceeded and that if IT is not already the world's largest industry, it will be within the next few years.
    I very much regret that Britain has sold to France one of its most outstanding examples of information technology, the transputer. United States' investment in microelectronics in 1986—the latest year for which we have figures—reached the colossal equivalent of £60 billion. The figure for France was £8 billion. In 1987, Japan's output of information technology products was 97 billion dollars. By comparison, the total for the EEC was more or less a comparable figure, while that for the United Kingdom was only $22 billion, or one fifth of that for the Community.
    Japan's research and development expenditure now stands at 6·9 billion dollars and is second only to that of the United States, which spends nearly 20 billion dollars. Japan's expenditure is now double that of the United Kingdom, at 3·1 billion dollars. It is a matter of the greatest regret that not one United Kingdom firm features in the list of top 10 companies in respect of computers, telecommunications or semiconductors. Japan completley dominates the export market for consumer electronics, with a 63 per cent. share, compared with 5 per cent. for the
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    United States—which is an interesting figure, because it represents a very rapid change from a position of dominance—and 4 per cent. for the United Kingdom, with 27 per cent. for the whole of the European Community.
    A specific and significant statistic is that relating to installed robots, upon which so much of industry's performance depends. The figures are most alarming. The total number of installed robots in Japan is 82,500; in the United States, it is 25,000; in Germany, 12,000; in France, 5,000; and in the United Kingdom, 3,600. If one reflects on those statistics, one draws at all points the conclusion that the diffusion, of microelectronic technologies is now the main driving force of all the OECD economies. The greater the diffusion, the greater the growth rate, the greater the prosperity and the greater the market dominance. The correlation is very clear and very specific.
    I turn to research and development, and hope that I shall interest the House with two technical examples. The first transistor was developed in 1955 or 1956. I recall holding a copy of one in my hand in the House. It had four gates. Today's commercial integrated circuits have 1 million gates. Laboratories are producing circuits with 4 million to 6 million gates, and the cutting edge of science is what are known as gigaflop systems having 1 billion gates. That stage has not yet been reached, but in the field of molecular electronics the cutting edge of science is getting very close.
    At the Carnegie Mellon centre in the United States, work is continuing on 400 megabit optical random access memories, which means having 400 million devices on one small memory chip. Even more exciting is the use of that device in super-computers using what is known as bacteriorhodopsin. That extraordinary material is found in the photosynthetic apparatus of bacteria on the shores of San Francisco, and it can be used as a bistable optical switch—that is, as a semiconductor, because it can signal either on or off—with the phenomenal switching speed of 1 million millionths of a second. When used with laser technology, it offers the prospect of computers that can operate thousands of times faster than the comparatively small number of supercomputers that currently exist throughout the world. A combination of semiconductors of that kind with polymer surfaces presents the possibility of developing artificial vision for computers before the end of the century—and we should reflect on what that could mean for humanity.
    I refer to two other important developments. Fujitsu has produced the first Japanese to English translation system—and what a shame that that was done in Japan—using a 32-bit personal computer. The price will be around £2,200, and the expected revenue is around £45 million in three years. The questions I ask are, why not us, and why not here? Even more depressing is that the first Josephson junction processor has also been produced by Fujitsu. It is based on the prototype developed by a brilliant young Englishman, Dr. Josephson of Trinity college, Cambridge. Again I ask the questions, why not us, why not here? When considering British information technology policy, we cannot escape asking such questions, whatever may be our arguments about the right method of dealing with the problems involved. Only this morning I heard that a young scientist in Hong Kong is close to developing a computer that will recognise spoken Mandarin, and the possible market for that is 1 billion Chinese.
    Mr. Timothy Wood: My hon. Friend mentioned a number of fascinating developments and quite properly asked the questions, why not us, why not here? Is he suggesting that companies or the Government should have played a part?
    Sir Ian Lloyd: I shall not escape that question. It is important and I shall try to answer it directly.
    It has been pointed out that the United States car industry has installed three super-computers. In the same article, we were told that Nissan has installed two which are so much more powerful than the three available to the whole of the United States car industry that they will be able to design, develop and crash a motor car without even building a prototype. Does the British motor car industry have access to that technology? If not, why not? Where does the responsibility lie?
    These machines cost an enormous amount, between £7 million and £15 million. There are a few hundred in the world and only three in the United Kingdom, but they are of the utmost importance. I am glad to say that Europe is not asleep. The European sub-micron silicon initiative involves a £2·7 billion programme and the intention is to increase the present density of integrated circuits by 10, to increase their size by 2·5 times and to extend the elements of memory from 40 million to 200 million—still well below the figure that I gave earlier—and the elements of logic from 2 million to 10 million.
    The world market for super-computers has been estimated to be £100 billion by the year 2000. Those who support the JESSI programme—the European sub-micron programme say that, with luck and if we do it properly and get it right, Europe's share may be £17 billion. Paragraph 5·5 of the White Paper "Information Technology" states:
    "The Government have no plans to require the creation of a national broadband network based on fibreoptic cable."
    I contrast that with what is happening in Japan and the United States. In Japan, it has been stated that the intention is to create a fully integrated digital communication structure using broadband fibre-optic microware.
    I hope that the House will forgive me if I quote fairly extensively from Senator Gore's speech on the so-called Gore Bill in the United States. He said:
    "High-performance computing is the most powerful tool available to those who, in an increasing number of fields, are operating at the frontiers of imagination and intellect. The nation which most completely assimilates high-performance computing into its economy will very likely emerge as the dominant intellectual, economic, and technological force in the next century."
    I fully concur with that judgment. Senator Gore went on:
    "If the United States is going to be a supercomputer superpower in the 1990s, we had better start building a high-capacity, national research and education network today."
    He argued:
    "A national network with associated supercomputers … will cluster research centres and businesses around network interchanges, using the Nation's vast data banks as the building blocks for increasing industrial productivity, creating new products, and improving access to education."
    How, he asks, is this to be done? Now we come to the centre of the debate. Senator Gore said:
    "Can we rely on the market system to provide this kind of infrastructure? We certainly couldn't where the Interstate Highway System was concerned … I believe that the Federal Government must again be a catalyst … Clearly, the
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    technological spinoffs and productivity gains would be enormous, from a network that would cost the Government less than one Stealth bomber."
    Senator Gore went on to develop in some detail what he hoped the Bill would do for the United States. He spoke of
    "putting in place a three gigabit per second"—
    not 3 million, which is our standard—
    "national research and education computer network by 1996 … including a National Digital Library … projects like neural networks; … basic research and education; … stimulating the development of hardware; … enhancing the development and distribution of software".
    Senator Gore said:
    "This bill would also authorise $1·75 billion over 5 years, fiscal years 1990 through 1994, to carry out the purposes of the act. The investment is tiny and the payback enormous".
    He said:
    "the only long-term deficit solution is to get away from short-term thinking, look to the future, and invest in the people, technologies, and equipment that will ensure our standard of living and increase productivity."
    That is what is happening or is about to happen in the United States and Japan. [Interruption.] My hon. Friend the Minister does not think that that is happening. Doubtless he will reply in due course. If I am wrong, I stand corrected. If it is not happening after what has been put forward, I should be surprised if it does not happen fairly soon. If this or something like it does not happen fairly soon in Japan, I shall be even more surprised.
    We come to the question: how is this to be done? I am coming to a sensitive matter. I have just read the exchanges with Lord Young when he appeared for the second time before the Trade and Industry Committee and answered probing questions on ministerial responsibility. I disagree with both parties, which puts me in a difficult position. I do not disagree with the objective of my hon. Friend the Member for Hastings and Rye (Mr. Warren)—it is extremely sound—nor do I agree with Lord Young's attempt to play down the significance of this ministerial post. It has been played down, largely on the ground that everyone now knows about information technology and everyone now uses it and therefore there is no need for central responsibility. It is like saying of the Treasury, "Everyone knows about money and we really do not need a Chancellor of the Exchequer." I acknowledge that the analogy is imperfect.
    I can claim some responsibility for this debate because I put up a paper in 1978 that developed the concept of a Minister for Information Technology. I was delighted when my right hon. Friend the Prime Minister came to power in 1979 and appointed the present Secretary of State for Education and Science to that post. While he was Minister for Information Technology, we made much progress. He was one of the few hon. Members, and certainly one of the few right hon. Members, with a clear appreciation of what this was all about. While he was in that position, he drove things forward and we were conscious that the nation had as the Minister for Information Technology someone with a grasp, determination and understanding of information technology. Alas, ambition and other things beckoned and the sad clothes of the Minister for Information Technology were dropped, like Cinderella's, into the wastepaper basket, and my right hon. Friend moved on to other and better things. As a result, the nation may have missed out, even if it has gained in other ways.
    Mr. Crowther: Does the hon. Gentleman agree that during the reign of that Minister for Information Technology we developed a considerable trade deficit in that business?
    Sir Ian Lloyd: That may be so, but the reasons for the development of the trade deficit, in both the United Kingdom and western Europe as a whole, and in the United States, are deep-seated. This is the obverse of the remarkable sense of vision, determination and organisation—almost unique in the history of the industrial world —that was displayed in Japan. I came across it for the first time in 1970, when a Japanese Minister of State with specific responsibility for information technology told a visiting delegation from Europe that information technology in Japan bore the same relationship to industrial power as coal did to industrial power in the 19th century. I have never forgotten that, just as I have never forgotten the vigour, force and conviction of that man's statement.
    What are the solutions? There are many, but I favour one particular solution. I am sorry to have to say that I disagree with my noble Friend the Secretary of State for Trade and Industry and I probably disagree with many others. We need this focus. If the whole record is in any sense a judgment of whether this decision is right or wrong, I believe that that record is wholeheartedly on my side and no one else's. I stick to that judgment because I have made it on the Floor of the House for almost 25 years. Events are what count and events have proved me increasingly right.
    As a country, we cannot afford to fail in this area. We must think much harder and we must be more effective. We must see a national and European leadership emerging in this sphere. Our science, our inventiveness and our technology are all equal to the challenge and I have every confidence in them. However, our institutions are not, and I have less confidence in them.
    Senator Gore talked about talent and determination. We have almost a superfluity of talent and the very best talent in this country is second to none. We have rather less determination. Let us put talent and determination together. When we have done so, let us use them.
    8.10 pm
    Mr. Malcolm Bruce: I will not attempt to follow the hon. Member for Havant (Sir I. Lloyd) with the great deal of technical knowledge he has revealed. However, I hope that he will agree that one does not have to have that degree of technical knowledge to be able to approach this subject and to recognise its importance. The information technology industry, regrettably, has its own technology, terminology, statistics and jargon, as many industries do. As a result, many people tend to shut it out, and to think that it is not for them and not terribly important.
    However, the advent of the development of information technology can be compared with the invention of the printing press, the railways, and the internal combustion engine all rolled into one. It is—or represents when used and developed properly—a major leap forward in the way that we organise our business, the means of production and our daily lives. It has already had a substantial impact, but I suspect that its eventual impact will be far greater.
    There are some simple, practical aspects of information technology to which we can all relate, given our everyday experiences of the past 24 hours. The habit has built up
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    over generations that people congregate in great cities. I do not believe that that development will be fundamentally reversed, but technology can enable a more sensible balance of time and place to be organised. Many of us use new technology every day when communicating with our constituency offices. I and many other hon. Members have word processors and fax machines at home to enable us to communicate between our homes and secretaries. Those are simple examples of information technology, but they have made an enormous difference to the speed with which information can be transferred. With the development of super-computers, not only speed, but volume and sophistication, come into play as well. They are all important and have substantial implications not only for the economy, but for society as a whole.
    However, there are still many casualties within the system and part of the reason for that is that information technology has come upon us so quickly. It still remains true, for example, that companies buy hardware before they have considered fully what they want to do with it, and before they have considered their software requirements and intercommunicability, not only within their own company, but with their customers and the companies from which they purchase. Much has been learnt, but the learning curve is expensive.
    It is interesting that a survey last year said that the most important priority among British management was upgrading existing systems. I realise that that is partly a reflection of the speed of technology, but regrettably, it is also a reflection of the mistakes made in earlier purchasing decisions. Members of the Select Committee on Trade and Industry will remember in particular the Bank of America, which we visited, where there were substantial errors and the Committee judged that the bank was continuing to make errors in buying information technology systems.
    It is interesting that a survey carried out by Amdahl when our report was in its early stages pointed out that attitudes in British management towards information technology lagged behind those in other European countries and especially in West Germany. One of the problems was that we did not spend much time in training our executives in the use of information technology. The survey said:
    "In Great Britain, the least amount of time is spent learning: for example it is believed that only 9 per cent. of British managers 'often' attend internal presentations or seminars on Information Technology, whereas it is 19 per cent. in France, 29 per cent. in Italy and 36 per cent. in West Germany".
    That is symptomatic of the problem. The survey also showed that the British position was mixed:
    "Expectations are high and there are some excellent success examples … There are some notable exceptions but there is clearly a great deal to do in improving attitudes and understanding if full benefit is to be gained in the years ahead."
    There are problems in attitude in British management, which the Government are entitled to say are not wholly their responsibility.
    However, I find it odd and the Committee collectively found it offensive that the White Paper was not a counter-statement, but a rather cavalier rebuttal of a serious piece of work which involved a great deal of evidence taken from a wide variety of sources and which made common-sense recommendations. The Government impugned many of the recommendations in a way that did not represent what the Committee had said. What offended me was that the Government criticised us for

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    points that we did not actually make and rejected recommendations that we did not actually make. That is not a businesslike way in which to go about the matter and was quite unnecessary.
    As the hon. Member for Havant has pointed out, there were areas in which the Government were able to say that they were acting positively and as our Chairman, the hon. Member for Hastings and Rye (Mr. Warren), pointed out in his excellent opening speech, not intervening is, in a sense, an act of intervention. It is a policy decision. The Government are taking a macho ideological position which does not make sense in the day-to-day world in which we all live. Their attitude seems rather unnecessary.
    As the Minister will recall, we had a debate on this subject on 19 April. 1 am pleased to say that the subject was chosen by my own party and the debate was opened by my right hon. Friend the Member for Yeovil (Mr. Ashdown), who has direct personal interest in these matters and is an enthusiast for information technology. In particular, he referred to the desirability of having a national broadband fibre-optic cable network. The Government have rejected that and have said that they do not believe that that is especially desirable. They said:
    "The Government have no plans to require the creation of a national broadband network based on fibreoptic cable."
    Again, the Committee did not suggest that the Government should require the creation of such a network. The Committee said that it thought that that would be desirable, and that it was interested to know whether the Government agreed and whether they felt that they would have an input into that network. I must ask the Minister whether the Government believe, just as neutral observers and operators in the game, that a broadband network is desirable. If they do not, the Minister should tell us why. If they do, what contribution are they prepared to make towards securing it? Nobody is suggesting that the Government should require that network or that they should make it happen, but they should say whether they think that it is desirable.
    The Parliamentary Under-Secretary of State for Industry and Consumer Affairs (Mr. Eric Forth): What would the hon. Gentleman do?
    Mr. Bruce: The Committee is asking the Government to say whether they agree, and if so, what they propose to do. Hon. Members of all parties agreed that a broadband network would be desirable. If the Government do not agree with that, the House should know. Equally, we should know what the Government consider to be the way forward—[Interruption.] The Minister will have the chance to reply, so these are perfectly reasonable questions.
    The Government accept responsibility for the road network. We have debates about it and different views are expressed, but the Government accept the responsibility for ensuring that there is a road network and that it is maintained, updated and from time to time extended. The Government also accept responsibility for the national grid, for gas and electricity. Why do the Government not accept the responsibility for a national information technology grid, which should be in exactly the same category because it is the modern equivalent of those other networks?
    If the Government's argument is that they do not have a role to play, either as a participant in the market or as a gentle guider of the market, they cannot point to history as
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    showing that the market has always got it entirely right. Most people would acknowledge that although the building of the railways was a wonderful achievement, the private companies involved built a lot of lines in silly places, with gauges that did not match. Many of those lines did not pay and ultimately had to be closed, yet the Government could have had a logical and useful role in standardising the gauge. It seems extraordinary that the Government cannot state the desirability of them making similar contributions in this area.
    As has already been said, the Government are substantial operators in the market place, as purchasers and users of information technology. I believe that the correct figure for Government expenditure is £1·8 billion per annum, which is about 20 per cent. of the total market. That is no mean and insignificant sum.
    When the Committee visited silicon valley we saw considerable evidence that that was substantially a private venture and an offshoot of the injection of Government defence spending. The Committee is not suggesting that that is what we should be doing. We are simply making the observation that the needs and the huge budget of the American defence industry caused the spin-off of that massive innovative private enterprise explosion in silicon valley. That example proves that the interaction between Government expenditure and private sector growth and development is inescapable and unavoidable. Therefore, for the Government to say that they are not prepared even to consider the implications of what they are doing in terms of its impact on the private sector is both absurd and irresponsible.
    It is not fair for the Minister to say that the Committee is implying that there should be detailed scrutiny. There was certainly never any suggestion that Government expenditure should be used to pull through technology. We simply argued that the Government should give some consideration to the impact of their expenditure on the development of the British information technology industry. We said that where the two could coincide, the Government's interest as a user and the industry's interest as a supplier should coincide, to both parties' mutual benefit. Any sensible Government would surely grasp that idea as being practical common sense and something that could be used to everybody's advantage.
    I value this debate. Our Chairman gave a full and excellent exposition of the Committee's work. I defer to him as somebody who knows a great deal about the subject and as somebody with a great deal more expertise than myself.
    This subject affects everybody. It is crucial to the development of our economy and our society. The Government should not artificially magnify differences, many of which do not exist. They should not belittle the work of the Committee because although the Committee members have broad backs, the sad thing is that ultimately the Government are not belittling the work of the Committee, they are belittling our industry, which worked so hard with the Committee to give a great deal of useful evidence, which I believe has been brought together in a way which is welcome to the industry.
    I repeat that the industry would like the Government to respond and to ensure that in 10 or 15 years from now our British information technology industry will be in much better shape than it is now and that the British economy and British society will be much benefited by that fact.
    8.24 pm
    Dr. Keith Hampson: This is an important debate. It was a privilege for hon. Members —sadly few in number—to hear the distinguished speech made by my hon. Friend the Member for Havant (Sir I. Lloyd), who knows more about the subject than probably any other hon. Member and who has campaigned on these issues for so long. I endorse the gist of his entire speech.
    My hon. Friend used the word "depressing" several times. I came to this subject as a total stranger when we began our Committee inquiry. Ministers sit in Whitehall, they are sometimes fairly new in their jobs and are not particularly conscious of the issues, so I stress that, as we as a Committee travelled around and saw the Japanese and American efforts and learned about what our partners in Europe, such as the French, were doing, it was indeed depressing to come back and discover what we are doing.
    Hon. Members have used metaphors tonight and have said that information technology is today's equivalent of the railways or the coal industry. I was going to use the example of steam. In so doing, we are searching to indicate the enormous significance of developments in information technology. However, what was not true of the earlier industrial revolutions was the sheer pace of change and the rate of development and progress that there is in this area of information technology. Indeed, that is at the heart of the problem because the continuous and huge cost has conditioned the way in which our rivals throughout the world are handling this issue. Therefore, it is not good enough for Ministers to give the impression that they want to wash their hands of it.
    Moreover, it is not good enough for Ministers to say that the Committee proposed solutions which, frankly, we did not. We were simply trying to draw attention to the scale of the problem and to the significance of what was happening elsewhere in the world. We were not saying that there should be an attempt in the words of the White Paper to "impose a 'best' solution." Where on earth did the Government get that from?
    In the same paragraph, however, the Government said something that we would endorse. I hope that the Minister will bear in mind my words on this in the light of his words in our previous debate on this subject on 19 April. The White Paper states:
    "Government action can be justified to seek to correct failings in the market mechanism".
    That is exactly what we proposed throughout our report and the Government have not denied that fact. Therefore, there was no point in the Minister saying when he replied to that earlier debate:
    "The Select Committee was looking for what the Department sees as a more interventionist approach than the Department of Trade and Industry is prepared to support … I regret … not modern Government policy."—[Official Report, 19 April 1989; Vol. 151, c. 385–6.]
    We are entitled to ask, which Government's policy? Not that of the Japanese Government. At the heart of capitalism, they pursue a different policy, as do the American Government. In this, as in so many areas, we are marching out of step.
    Miss Emma Nicholson: Has my hon. Friend considered the contracting out by the American Government? When I was at the NASA base the other day, I found that the most interesting thing was that it was run by IBM. Did my hon. Friend understand the effects of what he was looking at in the United States of America?
    Dr. Hampson: I shall deal with that in detail in a moment. I was trying to make the point that Ministers are making unfounded accusations about the Committee and that the Government are out of step with what we discovered other Governments were trying to do.
    The Minister's sentiments were not even consistent with the Government's own approach. Within three weeks of the publication of the Select Committee's report, the Department of Trade and Industry issued a press notice which said:
    "Government invests £22 million for extra IT research."
    I hasten to point out that Ministers had not told us that that was happening. Moreover, the Secretary of State appeared before the Committee for a second time three weeks before a major reorganisation of the handling of information technology in his Department was undertaken, yet we were given no indication that that was about to happen.
    The press release to which I have referred is one of several issued by the DTI boasting about what the Department is doing—of an information and engineering advanced technology programme for example, and of £22 million to help electronics to expand the science base of this country. Another press notice is entitled "Semiconductors", and says:
    "The Government announced today … £16 million for a national programme of research into high temperature conductivity."
    Where is the difference between what the DTI is doing on a large number of fronts and what the Committee proposed? We proposed that such activities should be openly accepted. We should not be hiding our initiatives and efforts, or the fact that we are doing what other Governments are doing, albeit in an ad hoc way. We argued that there should be co-ordination. The IT effort spans an enormous range of activities. It involves the schools and how we get young people to cope and to become involved naturally with information technology. It involves training teachers. We have an appalling record on that; information technology coverage in teacher training programmes is wholly inadequate. It involves the awareness of business men and a whole range of other areas' activities—the Training Agency and its training programme for young people and so on.
    We have already acknowledged that a Minister in the Department should be the co-ordinating Minister for inner-city policy. Information technology is enormously significant. Is there not a case for saying that we should have a Minister to try to co-ordinate the Government's efforts? That is what the Committee suggested, but the Government said that it was not part of their thinking on these matters.
    When it comes to trying to get orders for British industry, every effort—rightly—is made by the Department and the Prime Minister to win contracts—for example, for bridges in Turkey—and I give them credit for that, but are we really saying that help for the British construction industry is more important than assistance for information technology—both for the benefit of that industry itself and because of its application? We cannot say that. Information technology will not only be our largest, most important industry; it will be the industry on which our future prospects depend most heavily. This is what will determine the competitive cutting edge of a

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    modern industrial country—the acceptance, use and successful development of information technology. The Government acknowledge that in practice, but not openly.
    In Japan, the significance of information technology is all too apparent. When we visited Japan we were given a document issued by the Japan Key Technology Center. It contained the huge headline:
    "Reaching Out Toward the 21st Century"—
    and that is exactly what we are talking about. The document describes the use of Government funds to help co-operative research. Despite the enormous power of the Japanese information technology companies and the huge scale of their own research, they still draw on Government funds. If more than two companies are prepared to capitalise a research and development company, they can get 70 per cent. of the capital from the Japanese Government.
    They can also get loans. This is an interesting idea, to which I draw the Minister's attention. Loans are available for Japanese companies that enter high-tech research. Such loans cover 70 per cent. of the cost of research projects, and the interest and repayment of the loan depend on the success of the project. That is because the risk factor in information technology is enormously high. If the project is successful, the company pays the money back. If the project does not succeed, the payments are less, or the company does not pay at all.
    It is not good enough to say, as so many commentators in this country do, "Well, the Japanese have a different culture." Of course they do, but the idea of trying to bring together the power of the private sector with Government help to co-operate in this immensely costly area is not restricted to Japan. In odd ways, we try it here, and that may provide a little help on the edges, but the Select Committee was concerned about the scale of the investment gap.
    One finds similar arrangements in operation in the United States—the very heart of capitalism. Why did Congress pass the Joint Development and Research Act in 1984? Because the joint involvement of huge American corporations had been breaking anti-trust laws. Having seen what the Japanese are doing, it was most important for the Americans to encourage similar developments. Congress has enacted proposals giving tax credit relief to companies that are prepared to invest in research projects in universities. In America, we see fundamental research assisted by the Government drawing in private sector investment.
    What in any of this does the British Conservative Government disapprove of? Will not the Minister say for once that most of these activities are perfectly within the philosophy and approach of the present Government?
    Mr. Forth: No.
    Dr. Hampson: I find that extraordinary. I think that it should go on the public record that the Minister has just quite clearly said, "No." That is out of character with what other Ministers are saying and with some of the Department's own programmes.
    We cannot ignore the scale of the Japanese and American efforts. Rather than giving a great deal of detail about what the Americans do, let me draw the attention of the House to a book by a man called Kenneth Flamm, called "Targeting the Computer". The book is the result of a research project examining how public procurement policy and investment programmes in Europe and the
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    United States have enhanced the development of computer and information technology. The Europeans have not done things very successfully, as the book shows, but that does not mean that we should not make the effort to do them at all.
    The book shows how, in the 1960s, the defence programmes, developed largely for the American air force caused a great breakthrough in high-powered computer work. The role of the Defence Advanced Research Projects Agency in the 1970s is central to the book's thesis. Help was given to bright people who had bright ideas in universities in the United States—not specifically for military purposes but because it was thought that the development of technologies such as the Sun workstation would ultimately benefit the military. The Americans were prepared, as a Defence Department effort, to put huge sums of money in, even though there was no immediate or direct benefit. The Americans were funding projects that it would take 15 to 20 years to follow through, and we are seeing the results in the space programme and the like.
    Of course the British Government do not have resources on that scale, but it is a matter of philosophy and of our approach. We can do something, just as the French have. The "smart" card is now becoming a practical project. It is cheap enough in terms of unit cost for companies to use in the market. That happened largely because the French Government realised that French companies had something valuable but that the project would be difficult to launch because of the cost. They therefore said that a French man's medical records would henceforth be held on a smart card. That created an enormous market for the private sector to develop. The French Government were not picking winners or telling the private sector to do this or do that. It was an example of a Government entering partnership with private companies, helping to create new markets and helping companies to succeed as far as they could in those markets. That is something with which the British Government, of all Governments, should be concerned.
    Even if the Government do not accept the degree of intervention that the Minister might say my remarks imply, they have a role in increasing awareness. The Government constantly talk about awareness in the enterprise initiative. The Committee heard a lot of evidence to the effect that there simply was not enough awareness. We may be having a lot of awareness programmes about Europe. The Government have been spreading knowledge very successfully about the single market. One of the most important factors in helping the country to succeed in the single market will be the adoption of information technology.
    We do not have enough targeted programmes under the enterprise initiative for information technology.
    We do not have enough resources in the teaching company programmes specifically geared to information technology. Let us look at some figures: 41 per cent. of IT managers said that their senior management in this country were not successfully involved with knowledge in IT; the comparative figure for West Germany was 5 per cent.
    The Government have a major effort to make to heighten awareness, even if they do not want to pull through the technologies, help create the markets, develop the partnerships and do something further to develop research. They must do something further on research, even though they do a lot already. They already make

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    research grants. I have suggested a different type of loan programme, or, like the American Congress, a tax credit system for companies interested not only in specific developmental work for company use but in pure research.
    One immediate issue would be of enormous benefit, Increasingly, the Government have encouraged the private sector to help universities and other institutions of higher education. We have a programme of about £1 million to try to lever another £10 million in gifts or donations to higher education. But there is also VAT on charitable donations from companies. A company such as Hewlett-Packard that has been giving equipment to Leeds university is charged 15 per cent. on the value of the high-tech equipment that it is donating. That is absurd. That is the right and left hands of Government not knowing what each other is doing.
    We must somehow co-ordinate the Government's effort. The Treasury must believe that short-term cash figures are nothing compared with long-term investment in this country's future. The pay-off in 20-year-olds being able to use the best equipment from Hewlett-Packard, IBM and so on will be more important than spending £40 million on their grannies getting assistance for medical insurance. If we took the £40 million which we are going to put in to assistance for medical insurance and put it into the programmes that we already have to help companies give more equipment to higher education, it would pay for far more in the longer term.
    We are asking whether Britain can win and do its best in Europe and whether we can do the best of which we are capable in the world. The report is trying to tell the Government that Britain must be a winner and that, above everything else, we become a winner through the successful use of information technology. Frankly, the Government must have a more positive response, spend more, be more interventionist and be more prepared to co-ordinate their efforts.
    8.41 pm
    Mr. Roger Stott: I congratulate the hon. Member for Hastings and Rye (Mr. Warren) and the other members of his Select Committee on Trade and Industry on producing their report on information technology. I agree with most of the contents of the report. Without doubt, the Select Committee's conclusions are a devastating critique of the Government's policy on an industry which, in the words of the hon. Member for Leeds, North-West (Dr. Hampson) is the touchstone of the new industrial revolution. I agree with the Committee's 52 recommendations, but I should have liked to see them go a good deal further.
    My one regret is that this debate on an important subject is taking place so late. I should have liked to have a full day's debate, so that the Select Committee's recommendations could be fully explored. I have a great deal of respect for the work of Select Committees. I hope that the Minister has had time to reflect on and repent his rather stupid remarks of 19 April, when he referred to the Select Committee as an
    " old-fashioned idea of the gargantuan dinosaur".—[Official Report, 19 April 1989; Vol. 151, c. 385.]
    I hope that the Minister has read the minutes of the evidence of 26 April, when some of his hon. Friends were
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    particularly offended by his personal reference to them. I hope that he will have the magnanimity to repent and to desist from using such stupid language.
    Mr. Forth: I ask the hon. Gentleman to re-read that passage. In any case, the last words of my hon. Friend the Member for Leeds, North-West (Dr. Hampson) were that the Government must be more interventionist. I heard him say that, and it will be on the record. Why should I withdraw my remarks, which the hon. Gentleman misquoted, when at least one of my hon. Friends has justified part of what I was saying?
    Mr. Stott: That is a matter for the Minister to take up.
    Dr. Hampson: Will the hon. Gentleman allow me to correct that? I said that there is no doubt that my hon. Friend the Minister would call my view interventionist. I am talking about nurturing those industries, not intervening and telling them what to do.
    Mr. Stott: I hope that we can penetrate the Minister's mind, although I have serious doubts about doing that.
    There are three major facets to a debate on information technology. The first is the state of the IT industry, the second is the use of IT by the rest of industry, and the third is the Government's use of IT. I shall concentrate on those three issues.
    The Chairman of the Select Committee has already mentioned that we have a huge trade deficit in manufactures, particularly in information technology. I make no excuse for drawing that matter to the attention of the House. Britain's 1988 trade deficit for information technology was £3·9 billion. That was up by 15 per cent. on the year before, and was almost one third of the total deficit in manufactures. In the past four years alone, the deficit in electronic goods, which includes computers, telecommunications and audio equipment, has risen by a staggering 40 per cent.
    According to the Financial Times a detailed breakdown of the figures shows that the
    "United Kingdom does not enjoy any particular areas of strength."
    The biggest imbalance was in components, professional equipment and semiconductors, at £1·5 billion. For telecommunications, television and audio it was almost as bad, at £1·4 billion. That is double what it was in the past four years. The only declining part of the deficit from £1·1 billion in 1984 to £1 billion last year was in computer and office machinery, but that was almost entirely due to the assembly operations of United States companies in Britain, such as the one in Scotland—Wang—which is now leaving Britain.
    Employment in the United Kingdom electronic and electrical engineering sector has fallen from 752,000 in 1979 to 529,000 in 1989. At the same time there has been, and still is, an increasingly alarming skills shortage. No doubt the Minister will lament that deficit, and claim that all other OECD countries, apart from Japan, suffer trade deficits. That is a fig-leaf that has been claimed by himself and also by his boss, the Secretary of State, in his rather difficult encounter with the Select Committee on 26 April.
    In two ways, it is an extraordinary defence. First, apart from the rather special case of telephone equipment, in which we are still seeing the legacy of public procurement policies, both in their role of producing strong companies in Britain and the investment programme of British

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    Telecom and others, Britain's trade deficit in the other relevant sectors is the largest by far of any comparable countries.
    Secondly, and even more extraordinary, Japan's strength is claimed as a defence by a Government who maintain that the type of industrial strategy that is followed by Japan is an abomination against nature. In the words of the sour White Paper that was produced by the Government in response to the report:
    "'Strategy' implies attempts to 'pick winners', to ignore market signals or to impose 'best solutions'."
    "It cannot work," the Government say, yet strategy is precisely what Japan has and what has continued to contribute to its present dominance in information technology.
    Having read about the Secretary of State's encounter with the Select Committee. I remembered that he had a rather bruising encounter with my hon. Friend the Member for Rotherham (Mr. Crowther) about the definition of the words "strategy" and "policy". The Secretary of State said that the Government had a policy, but, apparently, his departmental officials told the Select Committee that the Government did not have a strategy for the information technology industry. I, and I suspect many others, do not believe that the Government have a policy or a strategy, no matter how those two words are defined. As the hon. Member for Leeds, North-West said, the Government cannot pick winners in the versions of the alternative policies that have been quoted by the Minister. As the Select Committee recognised, only customers that include the public sector can pick winners in the long term.
    Government can, however, do much more to ensure that conditions are created in which winners can come through. People look for winners in the first place. In the words of the Electronics Components Industry Federation, when giving evidence to the Select Committee, market forces cannot be relied on. The Government's fear of committing themselves in any argument about the future is similar to the man who will not leave home for fear of being run over and who spends his time compiling long lists of all those who have been run over in the past.
    Japanese industrial strategy has led to some mistakes, of course, but the Minister would feel much more comfortable tonight if he could claim Japanese IT success. Japan is not the only country to believe in the I-word, "intervention". The French-Italian state-owned company SGS Thomson could not believe its luck when it was allowed to purchase INMOS, the developer of the world-beating, leading edge transputer, just as it was moving into profit after the characteristically long lead time following the initial investment in hightech.
    The Conservatives never liked INMOS because it was established by the last Labour Government and was in the public sector. I find telling the response of Pasquale Pistorio, the boss of SGS Thomson, when asked how he would feel if he were British and saw such a unique company pass into foreign hands. "I do not know," he said, "I am not British." At one level that was, I suppose, a diplomatic answer, but at another it was extremely revealing. It could happen only in Britain. This is the only country in the world that would sell something as valuable as INMOS to a foreign competitor.
    There has been no lack of warning about the parlous state of the British IT sector. The NEDC warned in 1984 that Britain was approaching a precipice. In 1986, the Information Technology Advisory Panel called for a more
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    energetic and strategic approach. The Advisory Council for Applied Research and Development, the Cabinet advisory body, and the report to the Department of Trade and Industry from Coopers and Lybrand both called for action. Perhaps the most damning of all was the MacKinsey report into the British electronics industry which pointed a gloomy picture post-1992.
    The Government have not failed to heed just the warnings. They have done all they can to make the situation worse. They abolished the IT little Neddy and they abolished the post of Minister for Information Technology and gave us instead the Parliamentary Under-Secretary of State for Industry and Consumer Affairs. We always understood that his role in the Conservative party was to stand next to his right hon. Friend the Member for Chingford (Mr. Tebbitt), thus making him appear civilised. The Prime Minister should never have visited upon the Minister who will reply tonight the supposed mantle of Minister for Information Technology, considering that this is one of the most important areas in British industrial activity.
    One bright spot in the activities of the Government was the Alvey programme, but that is now almost entirely wound down. The proposals of the Bide committee, for the relatively modest sum of a £125 million follow-on, has been totally rejected by the Government, as the hon, Member for Hastings and Rye pointed out.
    Yesterday I spoke to Lord Gregson, who was a member of the Bide committee, who told me that that committee has worked for two years to produce its report and that the Government had done nothing about its recommendations. The tragedy is that that seems to be indicative of the attitude of the Government towards the IT industry.
    The Government are winding up their support for such strategic projects as fibre-optics and opto-electronics, as well as the micro-electronics industry support programme and software products scheme. They have made it clear that there is to be no significant support for the large-scale integrated microchip, the exact opposite of what is happening in the United States and Japan. Within a few weeks of the Government making that announcement, the American Government announced a $250 million support programme for collaborative research by United States companies into VLSI technology. Therein lies the real difference.
    We welcome the ESPRIT, RACE, BRITE and other EC-wide research programmes and we want to see those extended and developed. Although Britain's performance is poor, we must catch up with the rest of our European competitors. Part of the problem, and therefore part of the solution, must be to tackle Europe's general backwardness compared with the United States and Japan. Part of that must be a European-led position on the setting of standards.
    We welcome the new DTI push for OSI, even if it is too little, too late. We also think there could be more effort in ensuring that the public sector used OSI equipment. That is an example of the kind of interventionist public procurement policy that can work.
    But although European collaboration is an important part of the way forward, it cannot be a substitute for British Government action. A strong research base in Britian is a prerequisite to participation in collaborative EC research programmes. ESPRIT 2 was massively over-subscribed and we cannot pretend that it is a substitute for our own efforts.

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    Insufficient research and development is not the only problem holding back Britain. Despite insufficient funding by industry and a lack of resources in the universities, there are still major technological breakthroughs and exciting discoveries made in Britain. Some are brought to the market, and we wish them well. Some are even brought to the market by British firms.
    There are three factors underlying the failure of British IT to grow in the way that it has grown in other countries. First, British firms have been handicapped in terms of access to funds. There is now a well-researched funding gap for start-up companies, which applies particularly to ventures operating at the inevitably high risk, long-term payback, leading edge of technology. Many of the world's newest large and medium IT companies started out in Califorian garages. British garages have been much less productive. I suspect that that has more to do with the availability of funds to take the development on to the next stage than to any inherent superiority on the part of Californian garages.
    Secondly, we have the general structural problems common to all aspects of British manufacturing industry. I will spare the House a lecture tonight on high interest rates, but our easy market for corporate control and the City-induced emphasis on short-term profits has been particularly damaging to the IT industry. The great struggle between GEC and Plessey provides some important lessons.
    GEC is in a position to make the bid because of its extraordinary cash mountain. It has run up that cash mountain because it has failed to make new investments, and high interest rates allow it to make a significant return. As the Financial Times has commented:
    "GEC has no great reputation as an innovator in non-defence electronics. One of the most striking facts to emerge from the MMC report is that Siemens spends three times as much on research as GEC."
    GEC no doubt also sees an advantage in building up that cash mountain as a defence against other creditors. GEC has always been profitable, but it has not grown in the same way as other European companies.
    Dr. Hampson: As far as I can remember off the top of my head, that is a little unfair. Siemens is so much bigger as a company than GEC. Siemens is worth £14 billion to £15 billion, whereas GEC is worth £3 billion to £4 billion. I believe that GEC's latest account shows that it has been spending about 7 per cent. on research, which is higher than Siemens.
    Mr. Stott: The hon. Gentleman may or may not be right, but my point was related to the bid for Plessey. Although GEC has had so much money generated, it has not spent that money on increasing its research and development—which I believe it should have done—in the same way as other European companies.
    GEC has always been profitable but it has not grown like other European companies. Between 1982 and 1987, GEC declined by 27 per cent. in value. Siemens, on the other hand, grew by 70 per cent., AEG, another German company, grew by almost 500 per cent., ASEA Brown Boveri, the Swiss-Swedish firm, grew by almost 250 per cent. and Philips by 36 per cent. As GEC is one of our biggest firms, we are entitled to feel disappointed by those statistics. However, the City will be impressed by the
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    statistics that they value—profits per employee are almost twice those of any of the other big European electronics companies. The Opposition do not object to profits, but we believe that they should be invested in new products and markets and, especially, in research and development.
    There is even less excuse for GEC than any of the other companies because so much of its profit—like Plessey—is made from the taxpayer. GEC and Plessey are two of the six companies which were paid more than £250 million by the Ministry of Defence last year. Both companies—I should exempt Plessey because it has attempted to break away from that syndrome—have preferred the safe yet slow growth markets of defence contracting and other public sector supply contracts to the more risky but higher growth consumer side. Our large electronic companies need a more adventurous and risk-taking attitude and greater market orientation. I hate to think how much time, money and effort have gone into this bid, for no apparent reason. Once again, resources have been drained from the productive sector to profit the financial sector, where all those who make such a good living from the takeover market have made yet another killing.
    The third ingredient in Britain's IT industry is the I-word, Government intervention. I am not talking about centralised planning or DTI meddling in the day-to-day operations of individual firms, but about the kind of approach provided by MITI in Japan and the Department of Defence and NASA in the United States, where public procurement is done in a way that maximises spin-off rather than Britain's overly secretive approach.
    I was interested to read the comments of the hon. Member for Leeds, North-West, when he was cross-examining the Secretary of State. He said:
    "Who are the big buyers in the market? The big buyers, there, are the Government: MINITEL in France, NASA in the United States. From what you are saying, it may be the success of different companies, but it is the use of Government purchasing power that leads to that success."
    The Secretary of State then said:
    "What has MINITEL led on to?"
    If I recall, the hon. Gentleman then rounded on the Secretary of State and said:
    "Thousands of small companies have been founded in France on the back of MINITEL. Have your Department checked it out? What I want to know is, have you even bothered to find out? Do civil servants in this country even bother to look to find out what is happening elsewhere."
    The hon. Member for Leeds, North-West said that, because, if I recall, he was pretty steamed up. He was right.
    A good example of such an approach for Britain would be the introduction of broadband fibre-optics in the communications network, as the Select Committee has recognised. It is an area of technology in which Britain leads the world, both in the strength of the basic science research base and in the application of applied technology, particularly by British Telecom. Such a network would not require huge Government expenditure, bar some initial pump-priming and a commitment to use the network for purposes such as education and training.
    By making a commitment to such a network, the Government will ensure that the private sector can make the investment in the new technology and in the new capacity that will be required. Other countries will want to buy the expertise and technology that we develop. As has been said time and time again tonight, this is a rare opportunity to develop a common European approach, through standards setting and by collaboratively funded research in which Britain's industry can set the pace.

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    Broadband cable is the infrastructure of tomorrow. It is the river by which information can flow and the Government should begin to respond to that proposition properly instead of trotting out the conclusions of the Macdonald report.
    I recognise that time is moving on and that other hon. Members would like to participate in the debate. I do not believe, however, that the Select Committee has addressed the matter of high-definition television. The House will be aware that the standard for high-definition television will be a European one. To take advantage of that exciting new technology we must learn some lessons from the past. Television set production in this country has all but disappeared and frankly the Government have just sat back and let that happen. To prevent a further worsening of our balance of payments the Government should be working on—let us use the word that the Minister does not like—a strategy to assist and advise British companies so that we can meet the challenge adequately and play a strong role in Europe. Failure to do so by leaving it entirely to market forces will mean another wasted opportunity and another loss for Britain.
    There are a number of questions that I would like to ask the Minister, but I shall confine myself to two matters. What will happen after Alvey 2? How will the long-term research be funded? Does the Government believe that the United Kingdom has a chance to participate seriously in the artificial intelligence expert systems markets of the 1990s and beyond? What is the Government's position on COCOM, given that other European countries are making major strides in selling information technology products and telecommunications equipment to the Eastern bloc? What will the United Kingdom Government do to protect our firms that are penalised by the codes of COCOM?
    Over the past few years, the Government have been inundated with reports and advice from many learned quarters, the latest of which is the Select Committee's report. If they fail to respond positively to the advice given to them by the Select Committee and by industry and if they fail to respond to the plethora of advice that they have received in the past, they will stand guilty of abandoning the touchstone of the new industrial revolution.
    9.7 pm
    Mr. Richard Page: I congratulate the Select Committee and its Chairman on the report, although I do not agree with everything in it. It is rather like the curate's egg—good in parts.
    I welcome the opportunity, however, to debate information technology as it is the rope on which our manufacturing industry and commercial activities hang. Coupled with that are the effects of information technology on our balance of payments, whether that means benefits to it or a downside negative. At the moment our balance of payments is negative.
    It is a strange fact that, for some reason or other, this country has less investment in manufacturing industry, research and training than any of our international competitors. Why that is so could be the subject of a long, detailed debate, but I do not intend to examine every reason tonight. I know that I tend to sound like a well-worn record as I keep on producing the facts again and again, but I shall continue to do so until something is
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    done to put the situation right or I am proved wrong. Obviously, from a national point of view, I hope that I am proved wrong.
    There have been some significant improvements in our manufacturing investment over the past few years. However, those investments are only now level with those of 1979. In percentage terms against their gross national product, the Japanese invest 50 per cent. more than all the other industrialised nations. We are the lowest of the G7 countries when it comes to investment. That is on the negative side, but on the positive side, we must congratulate the Government on the work that they have done on inward investment, and the way in which they have brought companies' and countries' activities into this country. They have been so successful that even the French, that most chauvinistic of nations, have seen where they have gone wrong and seek to emulate us.
    I do not know whether the present levels of manufacturing and inward investment are sufficient to produce, in time, an acceptable level of trade balance without, as may shortly happen, demand being beaten down by the single club of high interest rates. My hon. Friend the Member for Hastings and Rye (Mr. Warren) clearly described the size of the problem when he said that, to overcome the present negative balance of trade, this country will have to produce and sell six more Metros every minute.
    However, that is enough of the general gallop around the park of my particular prejudices. I shall return to the information technology report and the Government's response. I have some sympathy with the Government over the dilemma that they face. First, they do not want to try to pick winners. I have to smile and welcome the conversion of the hon. Member for Wigan (Mr. Stott) who said that he, too, was apprehensive about any Government's ability to pick winners. His is another of the road to Damascus conversions which are taking place among the Labour party and its policies. If the hon. Gentleman is not careful, the Labour party and the Conservative party will become indistinguishable. I have no doubt that differences will be forthcoming at the next election.
    Mr. Crowther: I am extremely obliged. Will the hon. Gentleman tell us to which Conservative party he has just referred: the Government or Conservative Members on the Select Committee?
    Mr. Page: When it comes to splits in parties, nobody can beat the Labour party, in which the spectrum of political prejudices is so wide that it has gone round in a complete circle. I apologise for stirring up this minor controversy and I shall return to the other horn of the dilemma. If we did not have fun in these debates it would be time we all went home. However, if the House will quieten down, I shall return to the other horn of the dilemma. There are so few of us here this evening that I hardly think these are grounds for a riot.
    The Government must also ensure that there is sufficient national progress to combat and defeat international competition, which exists outside the EC. Later, I shall talk about how we must work within the EC to achieve the success which we all want.
    The Government's example is not one of the best. I am a member of the Public Accounts Committee and we have in front of us a series of reports from the National Audit

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    Office referring to the effectiveness of Government Departments in introducing information technology and computers into their daily operations. It would be invidious of me to go through the reports because they make sad and serious reading. The delay in introducing computerisation into Departments is nothing short of a scandal, with one bright exception: the Inland Revenue. That Department has taken significant steps to introduce computerisation and information technology into its operations. I say that from the bottom of my heart, not because I sent my income tax form in this morning.
    We face a dilemma. The Government spend more of total funds on research and development in information technology than do our industrial competitors; on the other hand, our industrial manufacturers contribute far less. The Government must be congratulated on helping to bridge the huge divide between academia and industry by setting up the Alvey programme—£350 million, which has gone into some positive projects. That is a memorable step towards reducing the huge gap and towards achieving what is regarded as standard by almost every other industrial country.
    I have offered credit and congratulations, but I am disappointed to read in the report that the Alvey project will not be evaluated until the 1990s. We must build our future on the success or failure of that project, so we need information about it. Paragraph 17 of the report states that we have not taken commercial advantage of the work done on these projects. That is a crying shame and it illustrates one of the weaknesses in our industrial structure.
    The baton has been taken up by ESPRIT. I am glad to see that more small and medium-sized businesses are involved in that.
    I support the Committee's recommendation that more tax aids be given to the smaller companies to enable them to improve and compete. As the House knows, I am a firm supporter of smaller businesses. They have the flexibility and ingenuity to get projects under way while big companies are still bending down to put their boots on.
    Against that background we must examine what the competition, particularly the Japanese, are doing. The report quotes the Japanese as saying that their information technology industry will be worth £600 billion by the year 2000—for a huge market which the Japanese are targeting for themselves.
    What part can we make IT play in the overall game of national economic success and in redressing the negative balance of trade? There is a growing realisation in the United States that if it adheres to its present course in IT it will soon lose out to the Japanese. United States leadership in this field is under severe pressure. Its lead in specialised chips, super-computers and software is being whittled away. My hon. Friend the Member for Havant (Sir I. Lloyd) gave us a devastating and sorry list of the advances being made by the Japanese. Their success has made the Americans aware of the vital necessity of having a large manufacturing base. It has exploded the myth of the 1970s that America could become more prosperous as a service-based economy.
    We can learn from these experiences. Only as part of Europe can we stem the tide and start to catch up. Europe is caught in the crossfire between the Japanese and the
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    Americans, as they shoot it out at the OK Corral. Only by skilful use of the sheer market size of the EEC can we ensure a revival.
    Europe used to show a surplus on information technology; now it shows a deficit. I could list the areas in which we are losing out, but I shall mention only one—the ability to write software. We used to lead the world in this skill, but we are steadily losing our leadership. We shall redress the balance only with the co-operation of all people, all Governments and all industries within the EEC. The official EEC efforts to revitalise high technology on a national framework have been based so far on ESPRIT, RACE and EUREKA. These have been worthy efforts in bringing companies and academic institutions together. The Government are to be congratulated on laying that foundation, and from that flows the recommendations of the Select Committee. Recommendation No. 21, reads:
    "the Government should plan now to avoid any hiatus in academic research in IT when both the national IT programme and Esprit 2 come to an end."
    Simultaneously and in step with that must be the next move, that of international co-operation within the EEC for the introduction of pan-European initiatives away from the protection of small and national champions that operate in a fragmented market. There must be a move towards a larger operation in a larger market. Time is not on our side, but I suggest that what I have said offers the best chance of success of survival for British-based industries in the IT world.
    9.21 pm
    Dr. Jeremy Bray: Like everyone else who has contributed to the debate, I welcome the report. I support the recommendations and I agree with all that has been said by the advocates of faster progress.
    I wish to take the argument one stage further. The hon. Member for Havant (Sir I. Lloyd) made some interesting remarks when he compared information and money. He said that people know broadly how to use money nowadays but they do not say that we can do without the Chancellor of the Exchequer, although to do so would be an attractive thought. The Chancellor does not spend his time telling people that they should use money rather than gold, or beads, or barter. Instead, he is concerned with who does what with money, tax, expenditure, expenditure on what, savings, savings by whom, investment in what and investment for what. As information technology matures, it should be concerned with the use that is made of information rather than the methods by which that use is made. All computer companies nowadays are advertising for sale solutions and not techniques.
    The origins of these matters go back far beyond the recollection or reminiscences of the hon. Member for Havant. Before the 1964 general election, I chaired a committee on the uses of information from a more mature information technology industry. One member of the committee was Professor Richard Stone, who was personal assistant to Keynes and a Nobel prize winner. Another member was Teddy Jackson, the director of economics and statistics at Oxford, who rendered Harold Wilson, as he then was, a great service in coming second to him in PPE at Oxford as an undergraduate. We put together the rationalisation of business statistics which led to the common register of business interests, the setting up of the business statistics office and other developments.

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    I shall mention two areas in which the Government are suffering because they are not taking the initiative. I am, of course, in favour of the broadband fibre-optic network, but for what? We must face the fact that the PA Consulting Group's technology report, the Zegfel report on the Netherlands and other papers all reach the conclusion that there is not a market for switched broadband in the foreseeable future. There was, however, a caveat in the PA Consulting Group's technology report. It stated that education and training was a potential application area but that the education sector had no money to spend nowadays and that it was not a potential customer. That may be true under this Government, but is it true in terms of the needs of the education system? I am speaking not in terms of the potential of information technology but of needs, efficient ways of raising standards in schools, the introduction of the national curriculum, and so on.
    I think that the answer to the question is probably yes. Interactive video and broadband access to the best teachers in the country, so that teachers in the classroom can call them up and use their material as needed, is probably the most effective way of raising education standards, in conjunction with many other developments in education. Those methods need to be developed; the curriculum material needs to be developed. It is an expensive business.
    The PA Consulting Group estimates that software development is 10 times as expensive as hardware. The software needs a long lead time in its development. It is no good producing hardware and then trying to develop the software for it, because it will be 10 years before that software is available to exploit the hardware potential. The software must be developed at a stage when the technology is still too expensive to use for its future application. The £6,000 interactive video machine may be far too expensive to use in classrooms generally, even if it is only one for the teacher, but it is essential for the development of the educational methods that will come into use in five, seven or 10 years time, through cheaper machines and on broadband. It is the most efficient way to develop and research the curriculum material, test it in the field, and train people in its use.
    We need to go on from there. The work of the Open university needs to be properly organised and integrated with such projects as the medical work at Bristol university, the engineering departmental links within London university, Salford and other initiatives. A number of operations are being carried out but they are grossly under-funded. There is no leadership from the Government or from the Secretary of State for Education and Science—the once so-called Minister for Information Technology.
    The personal computer revolution should be the model for the development of broadband applications. It is a new medium that people must learn how to use, just as they learned to use personal computers by watching their children playing computer games at home. The computers began to go into the schools and the parents wanted to buy them because they thought that they would provide opportunities for the future. If there is good curriculum material in the schools, everyone will also want it in his or her home. Every parent will want it for his child. There will be a willingness to spend the £400 to £800 per household needed for each new wave of consumer electronics, which introduces the new systems.
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    By their neglect of information technology, the Government are also damaging the processes of government. If anyone wants to empty the House, to drive out the Members, he should talk about information technology. If he wanted to drive out even those few Members present tonight, he need only talk about Government statistics. The report on Government economic statistics reveals an outrageous neglect, mostly by the Department of Trade and Industry, but also by the Treasury. There is a discrepancy in the national accounts between the records of income and expenditure of £14 billion—3·5 per cent. of national income. The books do not add up.
    The discrepancy is bigger than the trade gap. It is the stuff on which elections are won or lost, yet the Government are in the dark. They propose only some patchwork improvements to the individual statistical series and so on. The damage was done by Rayner, who missed the point that the biggest users of business information are the businesses themselves; the Government are but bystanders and watchers abstractors of a tiny part of the information flow that runs in great tides throughout the economy. A modern information system for the economy needs to be based primarily on the uses made by business of its own information.
    The system needs to be organised. There needs to be set standards of disclosure, of publication and of access similar to those that are set in the accounting profession. The profit and loss accounts, double entry bookkeeping and so on were invented by the Venetian traders in the middle ages. If the Government do not create the standards and systems, business cannot communicate with itself.
    Practical steps must be taken. The Government must realise that there needs to be an open system, and that system should be brought into the electronic age. It should be based on the requirement of companies to maintain their databases on-line on personal computers or floppy disks. There must be the appropriate security checks so that the right people have the right access at different levels.
    It might be a paradise for the hacker to begin with, until the hacker discovers that he can have more fun and make more money by collating the information that people want rather than by concentrating on what he believes to be hypersensitive information that is being kept from people. The data are then available on a consistent basis between the historical record and the projection into the future. It is not Government who build the models, it is the investment analysts, the shareholders, the takeover bidders, the employees, the customers, the suppliers, who, from this system can build up a comprehensive picture of how the economy works, how business works and how their prospects will develop.
    The proper posture of information technology is not as a supplicant, not as a master, but as an articulate and powerful servant.
    9.29 pm
    Miss Emma Nicholson: I welcome the opportunity to follow such a distinguished speaker as the hon. Member for Motherwell, South (Dr. Bray).

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    I cannot agree with the report. I urge the House to reject it and to adopt in its stead the excellent White Paper put forward by my noble Friend the Secretary of State.
    Had it not been for the acidic and arctic exchanges between the Secretary of State and the Select Committee, I would have felt able to draw conclusions as he did, empirically, from the report as it stands. However, I cannot, because when one draws conclusions from this report, one is accused of not having read it. The Minister himself was accused of not having read the report before his statement on 19 April when he talked about dinosaur tendencies. If being a dinosaur is an ability to respond effectively to change, the Select Committee in its report has demonstrated that quality.
    I must add here, with my respect for the individual members of the Committee, that the Committee's report does not reflect the high intelligence that is undoubtedly shared by all its members. I have sought long and hard for new ideas in the report, but I can find not one.
    Let me draw the Committee's attention to three crucial paragraphs where the report fails and where its failure is shown most clearly. Those are the last three paragraphs, Nos. 114, 115 and 116.
    I have to read the report because one has to be a fundamentalist when dealing with it. One must read the exact words; one cannot draw conclusions. Paragraph 14 says:
    "There is no doubt that the government no longer attaches a high priority to IT as a frontier technology needing sponsorship."
    I submit that that statement is made as a reflection of ill-considered thinking by the Government, and yet it is exactly the stance that the Government should adopt. A frontier technology? How could IT be a frontier technology? IBM started in the United Kingdom in 1954. I started work in ICL in 1961. IT is most surely not a frontier technology needing sponsorship.
    The report goes on:
    "Whatever the effect of this on the future of the IT industry it does not fit in well with the objective of promoting the use of IT in the economy."
    Of course it does, because frontier technology it is not and it most certainly does not need sponsorship.
    The report goes on:
    "We recommend that IT matters should be dealt with at Minister of State level in the DTI."
    It then says that the Government
    "shows no signs of formulating a total policy for the industry",
    and that the Secretary of State for Trade and Industry should
    "be made responsible for all aspects of Government policy on information technology and should produce an annual report on its implementation."
    Old-fashioned thinking indeed.
    But that thinking, particularly the last statement, is based on a complete misapprehension. The misapprehension is identified clearly in the evidence on Wednesday 26 April which we can read at paragraph 1145. That says that the Committee felt that
    "a Minister should be responsible for IT (as would be the case in every large organisation and enterprise in this country) at the Cabinet table."
    That is completely incorrect. Not all boards have an IT director. Nor do most boards have a director who has a
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    specific responsibility for IT in his portfolio. For the most part, IT is included in the finance director's responsibilities, and only to a limited extent.
    Industry thrives and creativity wells best from the bottom up and not, through imposition in the IT industry, from the top down. A rigidity of thinking runs right through the report, not just as a thread but as an iron rod which reflects dinosaurial thinking and points to an early death for the report.
    Let us look for a moment at the size and scale of the industry and on the Government's part and the way in which they have computerised so massively. No other speaker has touched on that. The British software industry alone is currently one of the country's great success stories, but almost everyone has overlooked that. It is growing at a rate of 25 per cent. per annum. What other industry in Britain unhampered by Government intervention is doing that? Hardware sales have been dropping annually. It is also worth remembering that computers currently hold 2 per cent. of all human knowledge.
    The Government have not held back from computerisation or from holding more human knowledge on computers. I refer to the Ministry of Defence's CHOTS endeavour using 75,000 terminals, which the Select Committee did not know about, and which will be implemented in September. Within three years, the Inland Revenue will be using 40,000 desktop computers addressing 20 different databases. Twenty million Department of Social Security records are currently being computerised. They will be on line and in daily use, and that will mean any number of word processors on people's desks.
    There has also been enormous investment in computerising hospital records, which, God and the suppliers willing, will be completed by 1991. That is perhaps the largest and most interventionist exercise of all, and the one which will have most impact on everyone in the country, because all of us are concerned about our own health. The Department of Trade and Industry is busy putting company knowledge and advice on computers.
    No member of the Select Committee has mentioned the tremendous departmental shift to computerisation, whereby the Government are changing from the old system of handing down budgetary control through votes, which we presumably inherited from the 1600s, to the modern system of budgetary control with its concomitant partner—the management information system. In academia there is JANET—a computerised network information which serves all our universities, which also have their own excellent departments of computer science. In addition, the Government are buying in through contracting out—and if that is not a way of supporting British industry, what is?
    TAURUS—computerisation of share registers throughout the country—is embedded in the Companies Bill. There is computerisation in industry, and among individuals in the form of bulletin boards. The tiny amateur network of the British Association of Computer Clubs alone has a network of 20,000 members.
    The report does not address some of the real problems. It overlooks what is happening and tinkers instead with old-fashioned thinking and with things that have been and gone. It does not consider properly the question of staffing. Of course there is a tremendous shortage of programmers, and perhaps that is one reason why there is more software intervention and why more self-created software is being

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    developed with ADA, which will mean that fewer human beings will be needed. I have already mentioned the crucial importance of women and of middle-aged men in IT and of the lessening need for young people because computing is no longer the skilled and sophisticated profession that it was when I first joined the industry.
    I draw the attention of the House to another part of the Select Committee's report. I shall not pull through the technology, but I shall pull through some of the report's very old-fashioned thinking, to arrive at a fraction of modern thought. Paragraph 51 contains a clear criticism of universities and the Government for not tempting the brightest
    "to undertake higher education in the appropriate disciplines."
    The really interesting thing about IT is that all its disciplines are eminently suitable for all graduates entering the computer industry. BP, for example, takes graduates from all the disciplines within any university framework, ranging from zoology backwards.
    The report does not address the key British weakness, which has nothing to do with training , lack of intellectual creativity, or lack of funds. It is the huge, built-in weakness of lack of marketing ability. That is the single largest factor in inhibiting computer development in Britain, and it always has been. The Select Committee's report does not attract attention to computer misuse, which accounts for one fifth of the computer investment—continuing, capital and recurring—in any computer installation. The report does not address the key issue of standards, which must be the thrust of computer usage.
    The Government's role in computer and high-technology matters should be minimalist. They are a major user of a high standard. The White Paper is not "sour", as was said earlier, but sane and sensible, giving a framework for growth within which United Kingdom-based IT will flourish. The Select Committee report should be discarded and rapidly buried. I suggest to members of the Select Committee, "Hands off information technology. You are well meaning, but astigmatic interference will throttle it to death."
    9.40 pm
    The Parliamentary Under-Secretary of State for Industry and Consumer Affairs (Mr. Eric Forth): This has been a fascinating and informative debate, which is not something that one can say about every debate. The hon. Member for Rotherham (Mr. Crowther) gave the game away. Indeed, several cats leaped out of bags this evening. Early in the debate, the hon. Gentleman stressed that the report had been unanimous. He went on to give us, as he was entitled to do, a traditional Labour party approach that laid great stress on what I make no apology for calling good, old-fashioned interventionism.
    The key to the debate and to understanding the difference of opinion between the Government and the Select Committee is in what the hon. Member for Rotherham said about the unanimity of the report. In his evidence to the Committee, the Secretary of State for Trade and Industry, Lord Young, said:
    "I believe there is an honest difference of opinion between us".
    Let us not try to hide that fact. From time to time, Select Committees produce texts that attract unanimous support from all parties on those Committees, and they should not be surprised if the Government are not able to accept their
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    recommendations. That Is almost axiomatic and self-evident. I am surprised that members of the Select Committee on Trade and Industry are surprised that there should have been this difference of view between the Select Committee and the Government.
    My hon. Friend the Member for Leeds, North-West (Dr. Hampson) gave the game away totally in his typically honest way and with his typically honest candour when, at the end of his excellent speech—I made a note of his words and will check them in Hansard tomorrow—he said that the Government must "be more interventionist." That is clear, open and on the record. The hon. Member for Wigan (Mr. Stott) recognises that. This is a major reason for the difference between the Select Committee and the Government.
    Mr. Stott: They got it right.
    Mr. Forth: The hon. Gentleman says that they—the Select Committee—have got it right, meaning, I suppose, that we, the Government, have got it wrong. The hon. Gentleman could not have put it better.
    Dr. Hampson: I was being ironic about my hon. Friend's use of the word "intervention". The Government cannot have a "hands off" approach. They must nurture, as do every other major Government in Europe, the United States and elsewhere. We are not proposing dinosaur thinking. My hon. Friend the Member for Torridge and Devon, West (Miss Nicholson) and my hon Friend the Minister seem to be somewhat ideological.
    Mr. Forth: If I have time, I shall return to the point about what other countries do. We must be a little careful. Many hon. Members have been seduced into seeing what they have thought are attractive elements in other countries' policies, taking the bits that they like. Contributors to the debate have spoken favourably about Japan, the United States and even other European countries. They have suggested that all we have to do is to adopt the good bits, the nice bits or the bits that seem to work well, and all will be well. If I have the time, I shall refute that argument. I do not find it attractive or convincing.
    My right hon. Friend the Secretary of State spent a long time with the Committee. I do not know whether it was a meeting of minds. At one point in his excellent speech, he said:
    "I believe Government, and I have said so already, has a very real role to set the climate, to set standards, but that the particular technology is not the responsibility of the Government to actually choose and select."
    My right hon. and noble Friend the Secretary of State put his approach in his usual succinct and elegant way.
    My hon. Friend the Member for Hastings and Rye (Mr. Warren), the Chairman of the Select Committee, made an excellent opening speech. He showed, as always, why a Select Committee is prepared to follow his leadership and to unanimously back his reports. From the nature and tone of his speech, I can understand why that should be so, even though there may be differences between us. It is important to put the record straight immediately on one of his points. My hon. Friend quoted an article in the Financial Times. I want to make it clear that there is no Department of Trade and Industry and Central Computer and Telecommunications Agency initiative as he suggested. I understand from the CCTA that it could, if requested, meet the firms to clarify aspects of particular

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    contracts, but in that case, all information and all contracts would be available to all bidders. Each bid for Government contracts is considered on its merits and bids by United Kingdom consortia are not given preference over others.
    I wanted to make that point clear because several hon. Members have suggested that in some way, either openly or surreptitiously, we could use Government procurement policy to favour British suppliers. Members of the Select Committee on Trade and Industry above all should know that that is not allowed within the European Community. My hon. Friend the Member for Leeds, North-West sought to draw a parallel with bridges in Turkey. One cannot compare the Government's support for civil engineering contractors building bridges in Turkey with the public procurement policy of information technology within the European Community. The parallel is faulty in so many ways that it is difficult to know where to start.
    Mr. Wood: This is an interesting point. A number of individuals and companies are concerned that although this country operates correctly with regard to EC policy, other Governments may not take such a pure view. Are the Government taking action to prevent those countries abusing the system?
    Mr. Forth: I am grateful to my hon. Friend for raising that important point. The answer must be that if there are members of the European Community who are breaking its rules, flagrantly or otherwise, we should not break them in the same way, but should encourage the Commission to discharge its responsibilities in ensuring that all member states obey the rules equally. Let us not become rule breakers, but let us rather urge the Commission to do the task with which it is charged and responsible—to create the level playing field we all want. I hope that my hon. Friend agrees.
    I want to give the House some idea of the extent of the Department's useful, productive and correct support for information technology. We give support for consultancy, for example, under the financial and information systems initiative and 2,250 such projects were approved in the first 14 months of the initiative. There are three major programmes for information technology transfer and information standards involving about £41 million of spend over three years. We support the introduction of new technology into schools. There is a £6 million programme and the Department of Education and Science also provides support under its schools initiative. There is support for information technology research and development under the Department of Trade and Industry and Science and Engineering Research Council joint framework for information technology, including the United Kingdom's contribution to the European programmes and that will total over £100 million of publicly funded support for information technology research and development this year.
    In that context, and in answer to the point raised by my hon. Friend the Member for Hastings and Rye and by the hon. Member for Wigan about the Bide committee, which recommended funding of £300 million in collaborative research
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    and development, taking into account spend through the European programmes. The Bide application programme was rejected because we believe—we have a consistent view about this right across the board, not just in relation to information technology—that near-market research and product development is best carried out by industry, and not by the Government using public funds.
    The hon. Member for Wigan referred to INMOS. It is true that industry in the United Kingdom had every opportunity to acquire INMOS when it became available, but the truth was—it may well be a sad truth—that no United Kingdom electronics company was prepared to take INMOS on. The fact that a company from another European Community country chose to do so may say something about its judgment, rather than about that of United Kingdom companies.
    I now turn briefly to high-definition television, to which the hon. Member for Wigan also referred. The Government are providing support for that product. We are supporting the work to establish a European standard for the system. Work is being undertaken under EUREKA, and United Kingdom firms are involved in that project. The Department of Trade and Industry is providing support for the necessary service and development. That is something that has been identified and to which measured support under the research and development heading is being given.
    Several hon. Members have referred to the IT trade deficit. Much concern has been expressed about that and, of course, the Government are concerned, just as they would about any trade deficit in a country which depends on trade more than any other country. However, there has been a trade deficit in this area for many years. Indeed, there was an IT trade deficit in 1978, in the last year of the Labour Government. Obviously, this is a long-standing problem.
    As the hon. Member for Wigan admitted, it is a problem that the other major European countries also face. The Federal Republic of Germany, France and Italy all have trade deficits in computers and communication equipment. In 1987, the United States moved into deficit in this area. Therefore, of all the OECD countries, only Japan has a trade surplus in this area. It should not be forgotten that the United Kingdom has a trade surplus with the rest of the European Community—of over £500 million in 1987. We should not paint too gloomy a picture, because we can point to success.
    In her excellent speech, my hon. Friend the Member for Torridge and Devon, West (Miss Nicholson) gave the House some good news and an upbeat picture rather than the doom and gloom that was presented by most hon. Members. We must strike a balance in these matters. We must acknowledge the problems, but also fully acknowledge the success stories. I thank my hon. Friend for doing that and regret that she was the only hon. Member to take such an approach.
    I turn now to the fibre-optic network, with which so many hon. Members are obsessed, besotted or dazzled—I do not know which word to use about it. The hon. Member for Gordon (Mr. Bruce) challenged me to give the Government's view on this, and I do so with pleasure. The Government have listened carefully on many occasions to the arguments in favour of promoting a broad band national grid. We have taken into account the views and the many reports that have been made on this subject. We keep a close eye on developments abroad.

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    No one doubts the potential benefits that can be offered by modern telecommunications, or that fibre-optic applications will he important. British Telecom already has over 550,000 km of fibre optic in its network and the amount is increasing daily. However, technological choice and consumer choice are also increasing and it is for the market to signal which services or technologies will be the most successful in the future——
    Dr. Bray rose——
    Mr. Forth: I am afraid that I cannot give way again, because I shall have to conclude my speech in about two minutes' time.
    The House must understand that there is a great difference between recognising the value of technology, which we undoubtedly do, and encouraging, where necessary, British Telecom to do what it thinks is right because it is the expert. As I do, the hon. Member forWgan acknowledged that we have a world lead in that technology. Given that that is the case, there can be no grounds for the Government stepping in with taxpayers' money simply to do something which the market is already doing ably in responding to the needs and demands as they arise. We in the Department of Trade and Industry have a clear view about where we are going.
    Many other points were raised in the debate and I shall study the record to see whether hon. Members require answers from me that I have been unable to give in the short time available to me. The importance that we attach to the matter is fairly obvious, not just from the Select Committee's report but from the care with which the Department of Trade and Industry put together its response to that report in the White Paper. Some unflattering things have been said about our White Paper, but I hope that hon. Members will appreciate that the White Paper at least gives full recognition to the Committee— to the importance of its report and to the detail of its work. The Department went to considerable lengths to reply in depths to the report, and it is to be regretted that we were unable to agree.
    I hope that the Chairman and members of the Committee will realise that we attach great importance to this matter and will continue to do so. We shall examine carefully all the speeches made today—some of them very expert—to decide whether they should influence the direction that we take in future. I gladly——
    Dr. Bray: Will the Minister give way?
    Mr. Forth: No.
    Dr. Bray: The Minister has five more minutes——
    Mr. Forth: No, because I want to give the Chairman of the Committee the opportunity to wind up.
    9.55 pm
    Mr. Warren: I shall draw the attention of the House to the points that need answers and explanations. I regret that my hon. Friend the Member for Torridge and Devon, West (Miss Nicholson) has misinterpreted the report. She was the only hon. Member who was not in step, and I suggest that it would be a good idea to look at our recommendation 51, which suggests that IT matters should be dealt with at Minister of State level. That does
    560
    not imply a Minister of information technology. Such a Minister could be responsible for finance, for the bicycle shed and IT.
    My concern about the Bide report was that there was no reply at all from the Department. I thought that that was rather an insult from a Department which had called upon the members of the Committee to give their best contributions to the report and to serve for two or three years.
    I am sure that many hon. Members will be surprised to know that, in both the Treasury and the Department of Health, there are Ministers with specific responsibility for looking after IT, just as our report recommended. I am delighted that they are there, and that in both Departments there is clear evidence of progress being made.
    Many of the Select Committee's problems in compiling the report arose from lack of adequate statistics. I hope that the Government will come up with some better ideas, because many of the statistics with which we had to deal were two to four years out of date. That may account for the fact that we were told by officials giving evidence that the Government did not have an IT policy and then Ministers came along and said that they did. Improved statistics might help us all.
    It is interesting to note that the Government have admitted that they do pick winners and that they are picking losers. That is not unusual, but we had always understood that they did not pick winners.
    Let me deal briefly with the broad hand communication system. I felt that the failing of the Macdonald report was that it did not involve the very people who were likely to be users. It did not even ask the questions of the Ministry of Defence, the prime candidate for becoming a user of that equipment. It did not ask the people in the City who dearly want that equipment. It did not ask people running financial services in Scotland, who know that they must have that equipment if they are to remain competitive. Not only do they want it; they are keen to invest in it. Industry is not looking for a Government subsidy all the way. I think that the Government should re-examine the matter and try to understand the opportunities that that system would create for those in business.
    We have moved a long way tonight towards understanding that the Department of enterprise can become the Department of initiative. I gather that the gargantuan dinosaur of Government to which my hon. Friend the Minister referred is on the Government side and not in the Select Committee. I assure the House that the Select Committee, undaunted and as vigorous as ever, will return as necessary to the subject of IT, because it is fundamental to the future wealth of our nation.
    9.59 pm
    Mr. Timothy Wood: I have listened to the debate with interest, and I have heard what I can describe only as a wide range of views. I have reservations about some of the points that have been made on both sides of the argument. Before one comes to any conclusion about solutions, one must examine the causes of the difficulties in information technology.
    Over the years, European countries have acted independently and have fought with one another in the development of information technology, but they have not succeeded. Japan has succeeded because it entered world

    561
    competition through consumer electronics and was thus able to build its research base and funding in a way that European countries did not. I hope that the Government will act to ensure that there is co-operation in Europe——
    The Question necessary to dispose of the proceedings was deferred, pursuant to paragraph (4) of Standing Order No. 52 (Consideration of Estimates).
    It being Ten o'clock, MR. SPEAKER proceeded, pursuant to paragraph (5) of Standing Order No. 52 (Consideration of Estimates), to put forthwith the deferred Question necessary to dispose of the proceedings on Estimates, 1989–90 (Class XI, Vote 3 and Class V, Vote 2).
    Question agreed to.

Class XI, Vote 3
Resolved,
That a further sum, not exceeding £259,162,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges which will come in course of payment during the year ending on 31st March 1990 for expenditure by the Home Office on court services, other services related to crime, probation and after-care, police, fire, civil defence, control of immigration and nationality, issue of passports, etc., other protective and community services, certain broadcasting services, data protection and other miscellaneous services including grants in aid and international subscriptions; and on administration (excluding prisons).

Class V, Vote 2
Resolved,
That a further sum, not exceeding £322,022,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges which will come in course of payment during the year ending on 31st March 1990, for expenditure by the Department of Trade and Industry at its research establishments (including the National Measurement Accreditation Service) and on the running costs of certain of its headquarters divisions, in its radiocommunications division and the Patent Office, support for industry (including industrial research and development, education, training, design, quality, marketing, management best practice and standards, business development and aircraft and aeroengine research and development), space technology programmes, protection of innovation, international trade (including export promotion, trade co-operation and international exhibitions), enterprise and job creation (the inner cities initiative and city action teams), miscellaneous support services, grants in aid, international subscriptions, provision of land and buildings, loans, grants, and other payments.

BUSINESS OF THE HOUSE
Motion made, and Question proposed,
That, at this day's sitting, the Human Organ Transplants Bill may be proceeded with, though opposed, until any hour.—[Mr. Kenneth Carlisle.]
Question put:—
The House divided: Ayes 90, Noes 2.

Division No. 286]

[10.01 pm

AYES

Alexander, Richard

Lester, Jim (Broxtowe)

Amess, David

Lightbown, David

Amos, Alan

Lilley, Peter

Arbuthnot, James

Lloyd, Peter (Fareham)

Arnold, Jacques (Gravesham)

Lyell, Sir Nicholas

Baker, Nicholas (Dorset N)

McNair-Wilson, Sir Michael

Braine, Rt Hon Sir Bernard

Mans, Keith

Brandon-Bravo, Martin

Marshall, Michael (Arundel)

Bright, Graham

Martin, David (Portsmouth S)

Brooke, Rt Hon Peter

Moate, Roger

Browne, John (Winchester)

Moss, Malcolm

Burns, Simon

Moynihan, Hon Colin

Burt, Alistair

Neubert, Michael

Carlisle, John, (Luton N)

Nicholls, Patrick

Carlisle, Kenneth (Lincoln)

Nicholson, David (Taunton)

Carrington, Matthew

Nicholson, Emma (Devon West)

Chapman, Sydney

Norris, Steve

Chope, Christopher

Page, Richard

Clarke, Rt Hon K. (Rushcliffe)

Patnick, Irvine

Cope, Rt Hon John

Riddick, Graham

Couchman, James

Rowe, Andrew

Durant, Tony

Sackville, Hon Tom

Evans, David (Welwyn Hatf'd)

Shaw, David (Dover)

Fallon, Michael

Shaw, Sir Michael (Scarb1)

Favell, Tony

Shepherd, Colin (Hereford)

Field, Barry (Isle of Wight)

Smith, Tim (Beaconsfield)

Forman, Nigel

Soames, Hon Nicholas

Forth, Eric

Stern, Michael

Freeman, Roger

Stevens, Lewis

Garel-Jones, Tristan

Stradling Thomas, Sir John

Gill, Christopher

Sumberg, David

Griffiths, Peter (Portsmouth N)

Taylor, John M (Solihull)

Hague, William

Tebbit, Rt Hon Norman

Hampson, Dr Keith

Thompson, Patrick (Norwich N)

Harris, David

Thurnham, Peter

Hawkins, Christopher

Trotter, Neville

Higgins, Rt Hon Terence L.

Twinn, Dr Ian

Hogg, Hon Douglas (Gr'th'm)

Viggers, Peter

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

Waddington, Rt Hon David

Howarth, G. (Cannock & B 'wd)

Waller, Gary

Hunt, David (Wirral W)

Warren, Kenneth

Irvine, Michael

Widdecombe, Ann

Jack, Michael

Wood, Timothy

Janman, Tim

Jones, Robert B (Herts W)

Tellers for the Ayes:

Knight, Greg (Derby North)

Mr. David Maclean and

Lawrence, Ivan

Mr. Stephen Dorrell.

NOES

Ashton, Joe

Tellers for the Noes:

Skinner, Dennis

Mr. Bob Cryer and

Mr. Harry Barnes.

Question accordingly agreed to.

Orders of the Day
  Human Organ Transplants Bill
  As amended ( in the Standing Committee), considered.
  Human Organ Transplants Bill
    New Clause 6

      INFORMATION ABOUT TRANSPLANT OPERATIONS
      `(1) The Secretary of State may make regulations requiring such persons as are specified in the regulations to supply to such authority as is so specified such information as may be so specified with respect to transplants that have been or are proposed to be carried out in Great Britain using organs removed from dead or living persons.

      (2) Any such authority shall keep a record of information supplied to it in pursuance of the regulations made under this section.

      (3) Any person who without reasonable excuse fails to comply with those regulations is guilty of an offence and liable on summary conviction to a fine not exceeding level 3 on the standard scale; and any person who, in purported compliance with those regulations, knowingly or recklessly supplies information which is false or misleading in a material respect is guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale.

      (4) The power to make regulations under this section shall he exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.'. —[Mr. Freeman.]

      Brought up, and read the First time.
      10.12 pm
      The Parliamentary Under-Secretary of State for Health (Mr. Roger Freeman): I beg to move, That the clause be now read a Second time.
      Mr. Speaker: With this, it will be convenient to discuss the following: New clause 1—Register of Transplants—
      'It shall be the duty of every hospital which transplants human organs to keep a record of every such operation, its date, the derivation of the organ, tissue type, blood group, relationship with the recipient and the name of the surgeons and consultants involved, and such records should be forwarded to the Regional Health Authority within a calendar month of the transplant.'.
      Sub-amendment (a) to new clause 1, at end insert
      `and the United Kingdom Transplant Service'.
      Mr. Freeman: New clause 1, in the name of the hon. Lady for Peckham (Ms. Harman), seeks to establish the statutory recording of the details of all human organ transplant operations, involving either live or cadaver donors. It was tabled in a similar form in Standing Committee.
      In Committee I said that we would come back at Report stage with a new clause to encapsulate the essence of the amendment. At that time we accepted the idea of making it a statutory requirement to record information concerning human organ transplants involving live donors. Since Committee stage, we have given further consideration to this matter and decided that it would be useful to have a complete record of transplants involving both live and cadaver donors. Leading representatives of the medical profession have also expressed to the chief medical officer their support for comprehensive mandatory records, and I know that some hon. Members are of the same opinion. New clause 6 sets out our proposals.
      Proposed amendment (a) to new clause I would mean that the United Kingdom transplant service would also
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      hold the statutory records. That is impracticable, since UKTS is not a statutory body. In our proposed new clause, the authority which will keep a record of the information will be specified in regulations under the Bill. We intend that the authority for this purpose shall be the health authorities. We will also specify the precise requirements of information to be supplied in regulations.
      The origins of the voluntary register to collect information about transplant operations go back far before the Human Organ Transplants Bill became necessary. Ministers agreed in principle to send out a health circular to initiate the register as long ago as 1986 and the medical profession also expressed their support for it. The arrangements to establish the voluntary register run by the United Kingdom transplant service were made before the decision was taken to include in the Bill the requirement to maintain a complete record.
      It will be some months before the regulations come into force and, until then, the voluntary register will provide information on transplants. That time will also offer a valuable opportunity to see how a system of collecting information on transplants works and to bring to light any possible problems.
      When the regulations setting up a system of statutory records are ready to come into force, we shall discuss with the medical profession whether it thinks there is any reason to continue the voluntary register and, if so, in what form. In Committee, we made a commitment to come back with a new clause, and I hope that new clause 6 fulfils that commitment.
      Ms. Harriet Harman: In Committee the Minister, in response to a new clause that we tabled, undertook to table a new clause today. I thank him for honouring that commitment.
      We tabled new clause 1 tonight and the Government have tabled new clause 6. By my magnificent powers of deduction I believe that the Minister will not accept new clause 1, but will press new clause 6. New clause 1 has two advantages over new clause 6; the first is time, the second is specificity.
      The Minister said that it will be a matter of months before the regulations come into force and that, until then, we shall have a voluntary register. He has said that, once we know how the voluntary register works, it will be possible to introduce the regulations. I am not satisfied that it should be in the lap of the gods as to when the regulations will be introduced to establish the register. I must press the Minister to give us some sort of maximum timetable for the introduction of those regulations. We are entitled to make such a request. He has not been sufficiently specific by just mentioning "months". I hope that he will tell us what the timetable should be—outside organisations interested in the Bill and in the register will demand nothing less.
      New clause 1 would set up the register under statute. I do not believe there is any need for a long enabling clause that gives the Minister the ability to make regulations on all sorts of issues. Having talked to those organisations involved in the transplant programme, the Minister knows that there is a great deal of unanimity about the make-up and content of the register. I trust that the hon. Member for Newbury (Sir M. McNair-Wilson) will support me in that.
      We do not need to make a big meal out of this, as it is fairly obvious what we want on the register. The Minister

      565
      need not bother himself with spending months examining the voluntary system and then drafting more regulations. If new clause I were accepted, the regulations would simply come into effect at the same time as the Bill. If new clause I were accepted, there would be no delay. We know what the specifics are, so we do not want to beat around the bush.
      If the Minister insists on new clause 6, I would seek the minimum guarantee from him that all the points that are made in new clause I about what should be on the register are included in new clause 6. Such an undertaking would be helpful.
      We are brimming with a lack of confidence in the Government's ability to get on with this, because we know that they are monstrously side-tracked with the impossible endeavour of trying to explain to the country the White Paper proposals. No one wants that White Paper, but the Government are trying to tell everyone that it is a terribly good idea. In the Department of Health, there is a political lack of impetus behind every other proposal. I do not want to see the Bill drift while Ministers slog up and down the country trying to persuade the people that the White Paper proposals are a good idea.
      The Government's record on this issue is one of indecision and delay. The question of kidneys for sale arose as long ago as 1985 and the Government did nothing about it until a further kidney-for-sale scandal occurred at the end of last year and the beginning of this. Nearly four years had elapsed before the Government acted to make it an offence to sell kidneys. I am frightened that they may allow the establishment of the register to drift under the carpet with the legion of other issues while they remain frenetically concerned about the White Paper. Therefore, I ask the Minister to think again, accept our new clause 1 and take seriously any points made in its support, perhaps by the hon. Member for Newbury.
      Sir Michael McNair-Wilson: I thank my hon. Friend the Parliamentary Under-Secretary for bringing forward new clause 6 and fulfilling a promise which he made, as the hon. Member for Peckham (Ms Harman) said, as a result of a clause tabled by the Opposition and me. However, my hon. Friend's introductory speech was too short for me to grasp the finer points of what he was saying. As I understand it, the new clause means that the Secretary of State may make regulations—[Interruption.] Would it be possible for those making interruptions from a sedentary position to give me a chance to make a speech on this detailed point?
      As I understand it, the new clause means that the Secretary of State may make regulations requiring persons unknown to supply to an unnamed authority information which is not detailed, and that body shall keep a record of information supplied according to the regulations.
      I recognise that that is an attempt to summarise the clause, and if my hon. Friend tells me that I have misunderstood it I shall give way immediately. However, if I have not misunderstood what he said, it seems that the first difference between his clause and new clause 1 is that I can understand new clause 1 but I cannot understand new clause 6.
      New clause 1 lays down a clear-cut duty and seems to contain most, if not all, of what any of us would want to see in a register of transplant operations. The
      566
      Government's new clause is more obscure and is linked to an authority which dares not speak its name, or even to tell us where it will meet.
      My hon. Friend seemed to imply that the authority was a regional health authority. If that is so, he will surely find that the Bill now becomes misleading. If in new clause 6 the authority referred to is a regional health authority, and in clause 2(3) another authority—as clause 2 (3) puts it,
      "The Secretary of State may by regulations provide that the prohibition in subsection (1) above shall not apply in cases where—
      (a) such authority as is specified in or constituted by the regulations is satisfied—"
      I for one will find myself wondering which authority is which and how we shall know to which authority each clause refers. Will my hon. Friend clarify that point?
      Mr. Freeman: It might be helpful to my hon. Friend if I described the authority under clause 2. This is the authority which will look at all live donations between non-genetically related individuals. That is its sole function, and I said in Committee that we would lay down the regulations. That authority deals only with whether the non-genetically related individuals should be permitted to have a transplant of a kidney, which is the only organ which can be transplanted from live patients.
      I apologise if my hon. Friend could not hear what I was saying earlier. In new clause 6, we are dealing with a separate issue—the recording of live and cadaveric transplants. It is a recording of an event which has taken place. It is not prospective: it is historical. It is designed to meet the point that my hon. Friend and other members of the Committee raised. It is a comprehensive register of all transplants.
      We have not reached a conclusion on whether the authority in question should be a regional or district health authority. Perhaps, if I catch your eye, Mr. Speaker, I shall develop that point at greater length at the end of this brief debate.
      Sir Michael McNair-Wilson: I am grateful to my hon. Friend for shedding light on the authority, but anyone reading the Bill after tonight's debate will still find the word "authority" in the clause and in the new clause, yet different authorities are meant. How will my hon. Friend clarify that so that there is no doubt in anyone's mind? I read the Government's new clause as referring to the authority mentioned in clause 2, so the speech that I subsequently prepared no longer makes sense. No matter; I have told my hon. Friend of my doubts and I am sure that I would not be the only person to draw the wrong conclusion from reading the word "authority" in the two versions.
      I want to go a little further into why the new clause is worded as it is. As the hon. Member for Peckham asked, why is the statement to be voluntary—
      "The Secretary of State may make regulations"?
      That is not mandatory. Why was it felt necessary to begin with that open statement when, as the hon. Lady rightly said, the request for a mandatory register has been circulating for at least four years, if not longer? I find myself wondering whether the truth is that the regulations have not yet been put together by the Department.
      I also find myself a little uneasy about the assurances that we have been given that this voluntary statement will be turned into a mandatory register at a later date. I have

      567
      been sent a letter dated 6 June 1989 by Mr. Ross Taylor, president of the British Transplantation Society. Under the heading "Policing the Present Bill", he writes:
      "Since 1985 when the original troubles were first reported the British Transplantation Society has been trying to create a mandatory Register of all transplant operations, whether public or private, and covering all organs. We have repeatedly been told by the Department of Health that a mandatory Register is not possible because it would require legislation and we are repeatedly told that it cannot be incorporated in this present Bill. We believe very strongly that it should be incorporated in the present Bill and we can see very little reason why anyone should object to making a record of their transplant activity. We have all the documentation, all the computer work and all the arrangements in hand to establish a Register, but we are told that it will have to be a voluntary Register. If it is voluntary we may well miss the very few transplant operations which are the particular ones that we need to record. The Royal College of Surgeons of England has jointly agreed with the British Transplantation Society to supervise this register, but I don't think I am divulging any confidences when I tell you that the President-Elect of that College feels very strongly indeed, and has said so on many occasions, that the Register should be mandatory."
      I agree with Mr. Taylor and with the president-elect. I hope from the nod that my hon. Friend the Minister is giving me that he, too, accepts that position. Although we are being asked to pass a clause which is not mandatory—I cannot understand why it should not be—I hope that we can have my hon. Friend's assurance that by this time next year the clause will have set up a mandatory register.
      10.30 pm
      If the clause does initiate the setting up of a register, who will keep it? I do not think that my hon. Friend the Minister told us that. Is the register to be made public in any way? Can hon. Members, for example, ask for a debate on the register? Will that be possible? Why should the register not be kept by the United Kingdom Transplant Service? The Minister says that it is not a statutory body, but it is the body which co-ordinates transplants in the United Kingdom. If not the United Kingdom Transplant Service, why not the British Transplantation Society? The president of the society is saying, "I have the equipment and the wherewithal."
      It seems so obvious to me that that is the machinery that should be used to keep the register, to keep it within the hands of those who are most closely involved and who are most anxious that the ethics of transplantation should be maintained at the highest possible level. I have an article from the British Medical Journal of 1986, I think, which sets out recommendations on the use of living kidney donors in the United Kingdom by the British Transplantation Society. The recommendations could have been a model for any legislation that we have discussed in our deliberations.
      I hope that my hon. Friend the Minister will give me a promise that the voluntary element in the clause will be translated into a mandatory register within 12 months. I hope also that he will seriously consider whether the United Kingdom Transplant Service or the British Transplantation Society should become the body to manage the register, to keep it up to date, and to be answerable for what goes into it.
      Mr. Freeman: I hope that I can give all the assurances that my hon. Friend the Member for Newbury (Sir M. McNair-Wilson) has sought. New clause 6 is the Government's response to a system that I was asked in Committee to introduce on Report. It is a mandatory
      568
      reporting system for health authorities covering all live and cadaveric organ donations. We shall introduce regulations—I am happy to respond to the hon. Member for Peckham (Ms. Harman), who asked for an assurance—under the new clause and under clause 2, which deals with non-genetically related live donations.
      New clause 6 deals with the reporting system, and we shall introduce regulations as soon as possible—I hope that that will be before the end of the calendar year. The regulations will be debatable. We shall be specifying to whom the reports should be made. We still have not resolved whether it should be regional or district health authorities. We shall be specifying also what should be reported. I assure the hon. Member for Peckham that we shall bear in mind the text of new clause 1, which is specific on what should be reported.
      The voluntary register is to be organised by the United Kingdom Transplant Service. It will be running for the balance of this year, for the six months prior to the coming into operation of the reporting mechanism under the regulations. For that period the voluntary register will be performing a valuable service. For the purposes of research, perhaps, clinicians will be more likely to turn to the voluntary register for greater detail than to the Department of Health. I am thinking of aggregate statistics that we might have from the regional and district health authorities under the reporting mechanism.
      Sir Michael McNair-Wilson: Who will keep the voluntary register?
      Mr. Freeman: We will not frustrate or stand in the way of the continuation of a voluntary register, which could proceed simultaneously with the separate reporting mechanism envisaged under new clause 6. I well appreciate the argument that the voluntary register might provide the research data that clinicians need.
      I shall now answer the points raised by the hon. Member for Peckham. I have dealt with the expected timing of the laying of regulations, which will be debatable. We need to consult the medical professions about what is specified in the reporting mechanism and to whom the report should be made. As to the hon. Lady's suggestion of a lack of impetus, I had hoped that she might congratulate the Government on their rapid progress. The Second Reading Committee was on Tuesday 16 May and now, in the first week of July, the House will—I hope—shortly be giving the Bill a Third Reading. I hope that we shall make rapid progress so that the other place can complete proceedings so quickly that the essential provisions of the Bill can come into force.
      Sir Michael McNair-Wilson: I am sorry to delay the House——
      Madam Deputy Speaker (Miss Betty Boothroyd): Order. The hon. Gentleman has already spoken once, and under consideration I regret that I cannot allow him to speak again.
      Question put and agreed to.
      Clause read a Second time, and added to the Bill.

    New Clause 7

      PROSECUTIONS
      `No proceedings for an offence under section 1 or 2 above shall be instituted in England and Wales except by or with the consent of the Director of Public Prosecutions.'.—[Mr.Freeman.]
      Brought up, and read the First time.
      Mr. Freeman: I beg to move, That the clause be read a Second time.
      I shall not detain the House. The new clause would ensure that prosecutions under clauses 1 and 2 of the Bill could go ahead in England and Wales only with the prior consent of the Director of Public Prosecutions. This is to prevent frivolous private prosecutions. A similar clause has been used previously in other Acts whose subject matter is emotive, such as the Surrogacy Arrangements Act 1985. I commend the new clause to the House.
      Ms. Harman: By introducing the new clause at this stage the Minister is making it unduly restrictive. I quite understand that he does not want private prosecutions, and I support him on that. However, it does not mean that he needs to erect the hurdle of requiring the consent of the Director of Public Prosecutions. If he wanted to exclude private prosecutions, he should have simply done that. This new clause, together with his rejection of new clause 2, makes this an unenforceable statement of intent rather than a proper addition to the criminal law. I do not understand why he did not simply rule out private prosecutions rather than including the hurdle of the DPP—who, I understand, has plenty to do without having to take on this additional duty.
      Mr. Freeman: The practical effect of excluding private prosecutions is, essentially, to put the matter into the hands of the DPP. I admit, although not a lawyer, that it was our intention to include this provision in the original draft of the Bill. I regret having to come to the House at this stage to seek its agreement to the new clause. It is not an afterthought; it is a correction.
      Question put and agreed to.
      Clause read a Second time and added to the Bill.

    New Clause 2

      DISCIPLINARY OFFENCES
      `It shall automatically be deemed a disciplinary offence of serious misconduct if a doctor is guilty of an offence under this Act.'.—[Ms. Harman.]
      Brought up, and read the First time.
      Ms. Harman: I beg to move, That the clause be read a Second time.
      New clause 2 simply says that if a doctor commits an offence under the Act it will constitute serious misconduct and so require the GMC to consider the matter as a disciplinary offence.
      There is a history to this. In the past, the problem has been that, despite prima facie evidence that a doctor had been involved in such activities, the GMC was not prepared to take any action.
      I know that in response the Minister will say that another statute says that if a doctor commits any criminal offence it is open to the GMC to look at the matter and take disciplinary action. We know that it has the power to look at it, but new clause 2 obliges it, at least on a prima facie basis, to consider an offence under the Act as a
      570
      disciplinary offence of serious misconduct. Its failure to do so in the past has led to the need for the Bill. Had the GMC acted more swiftly and purposefully, we would not have needed the Bill in the first place.
      Without new clause 2 it would be open to the GMC to say that a doctor has been prosecuted and found guilty under the legislation, but that he has been punished enough by the courts and by having his name in the paper so the matter will be left there and the doctor will be allowed to get on with the job.
      The new clause makes an offence under the Act automatically a disciplinary matter. I cannot for the life of me see why the Minister should object to it. He is simply being a bit backward in coming forward on positive issues on the Bill. The Minister should get a grip on the issue. It is obvious that we need the new clause and the Minister should allow it to be included in the Bill.
      Mr. Freeman: The hon. Member for Peckham (Ms. Harman) asks me to get a grip on the new clause. I hope that I have had a grip on the Bill during its proceedings. If a doctor is convicted under the Bill, which we hope will shortly become an Act, the hon. Lady wants automatically to instruct the GMC to disbar the doctor.
      Ms. Harman: No, to look at it.
      Mr. Freeman: The hon. Lady has offered no evidence that the GMC has expressed any lack of interest in the Bill or any intention not to investigate or debar those who are convicted. The reverse is true: the GMC has expressed its firm support for the Bill.
      I said in Committee that I would be happy to look again at this, and I have done so. One of the values of our parliamentary proceedings is that we have time for reflection. I am clear that we should not breach the general principle that where disciplinary powers are given to a court or a council such as the GMC—which was given those powers by the Medical Act 1983—it should not at the same time be told that it must automatically take certain action on certain cases brought before it. That negates the whole purpose of setting up a body with discretion.
      I am satisfied, as I hope that the House will be, that the new clause is not necessary. I ask the hon. Lady not to press it to a vote. There will be other occasions to debate the broader principles of how the GMC behaves, when I shall be happy to join the hon. Lady. The new clause raises wider issues and the hon. Lady has not made her case.
      Ms. Harman: The Minister says that I have brought forward no evidence of the GMC's lack of interest. As I mentioned in moving the new clause, it spent four years doing nothing, even when the subject was a matter of public outcry. Its lack of interest is a matter of public record and concern. The Minister would not have had to bring the legislation before the House if the GMC had shown any interest before. The evidence of its lack of interest is the existence of the Bill, and that is lamentable.
      The Minister says that I am asking that a doctor should automatically be debarred if found guilty of an offence under the Act. I am not. He should understand that an offence of serious misconduct requires the GMC to look at the matter for disciplinary purposes. A range of penalties is then open to it, ranging from debarring or suspending from practice right down to a polite letter telling him not to do it again. I am not putting forward automatic

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      debarring; I am just saying that the matter should be put under the GMC's nose so that it does not escape its attention in the way that it has done for the past five years. However, I shall not press the matter to a vote.
      Question put and negatived.

    Clause 2

      RESTRICTION ON TRANSPLANTS BETWEEN PERSONS NOT GENETICALLY RELATED
      10.45 pm
      Mr. Freeman: I beg to move amendment No. 3, in page 2, line 30, after 'children', insert
      'of his brothers and sisters of the whole or half blood or'.
      Madam Deputy Speaker: With this it will be convenient to discuss the following amendments: No. 1, in page 2, line 31, at end insert
      `and (e) his nephews and nieces of the whole or half blood.'
      No. 2, in page 2, line 44, at end insert—
      `(c) the person into whom the organ is to be transplanted is

      (i) the spouse of, or

      (ii) related by marriage within the degrees laid down by subsection (2) above to the person from whom the organ is removed.'.

      Mr. Freeman: We accepted the principle of amendment No. 1 in Committee. It was not our intention to exclude nephews and nieces from the definition of genetic relations for the purposes of the Bill, and, as promised in Committee, we have tabled amendment No. 3, which will have the effect of including them in the definition.
      Amendment No. 2 was also tabled in Committee but was withdrawn by the hon. Member for Peckham (Ms. Harman). I was given to understand that the hon. Lady accepted my argument on why the statutory exclusions from the prohibitions of clause 2 should not be extended. However, as the amendment has been tabled again, I shall repeat my reasons for urging hon. Members to resist it.
      Amendment No. 2 seeks to extend exemptions to prohibitions under clause 2 far beyond what is intended. The Bill already excludes genetically related people from scrutiny by the authority. A reason for that is that the existence of a close genetic relationship can be verified with a high degree of accuracy by laboratory testing. In this country, the vast majority of live transplants would be covered by that exemption, as close family members are both more likely to come forward to offer themselves as donors and to prove compatible, in the medical sense.
      Under the Bill, the existence of a genetic relationship would be verified in each case in an objective way by such testing. Appropriate tests may have already been carried out in the process of trying to establish the compatibility of the donor and would-be recipient. In the case of relatives "in law" or people not related at all to the would-be recipient, the existence of some kind of relationship or personal tie is more difficult to establish. Unfortunately, we cannot rule out the possibility of non-genetic "relationships" being formed solely for the purpose of the operation or of pressure—economic or otherwise—being brought to bear upon a donor to submit to a transplant operation.
      For those reasons, it is intended that the authority will consider the available evidence in each case where no genetic relationship has been established, before giving an independent decision on whether an offer of donation is altruistic. However, the fact that the authority will
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      scrutinise all cases of live donation between non-related persons does not imply that unnecessary obstacles will be placed in the way of transplants between spouses or "in law" relations. I suggest that amendment No. 2 is contrary to the whole intention of clause 2. 1 urge the hon. Lady to reflect further and not to press it to a Division.
      Ms. Harman: Long ago in the distant past, before I became a Member of Parliament, I wanted to be a parliamentary draftsman. Government amendment No. 3 has been introduced at this late stage because the Government become so confused by all the gobbledegook that they omit to say what they really mean. In this case, they omitted nephews and nieces from the definition because they were so busy referring to
      "brothers and sisters of the whole or half blood."
      Helpfully, with my otherwise under-used parliamentary drafting skills—and certainly for free—I drafted amendment No. 1. But the Government prefer their gobbledegook, which is more complicated and will therefore provide more work for the lawyers. None the less, the definition has been restored, so I am grateful to the Minister for at least incorporating what would otherwise have been a significant omission.
      The Minister reminds me that in Committee the intellectual brilliance of his arguments swayed me against my own amendment to include married people and people related by marriage. However, when it came to drafting my amendments, the force of his arguments escaped me. Now that he has made them again, I am happy to accept them, and I shall not press amendments Nos. 1 and 2.
      Sir Michael McNair-Wilson: My hon. Friend the Minister referred to the authority in clause 2. He said that it is the body that will give consent to these various operations. Again, I am puzzled. Is he saying that the transplants that will take place have been notified to the authority referred to in new clause 6 and that they will be notified also to the authority referred in clause 2. so that two authorities work together? Are both authorities to keep a record of all these transplants? If not, one authority will be aware of all the transplants taking place within families and one will not. I cannot see how that is possible. Unless both authorities know what is going on, the authority that is meant to police the Bill cannot function. I should be grateful if my hon. Friend would clarify that point.
      Mr. C. J. Rudge, consultant transplant surgeon, has said:
      "I have considerable reservations about this second clause in the Bill. There are a number of situations in which the emotional relationship between a potential donor and recipient can be overwhelmingly in favour of allowing transplantation to proceed. I am thinking in particular of transplantation between husband and wife (or vice versa), between step-parents and their children"—
      they are not referred to anywhere in the Bill—
      "and even between individuals related by marriage. I can see nothing morally or ethically wrong for transplants in any of these categories to be carried out, and I have considerable anxieties that they are all made illegal by this Bill. There is no doubt that the number of cadaver kidneys becoming available in this country does not meet, and is never likely to meet, the requirements for the number of patients awaiting transplantation. Within my NHS practice I am currently carrying out a number of emotionally related transplants—until now exclusively between husband and wife. I am very concerned that if these transplants are to be stopped then this would have a significantly detrimental effect on the dialysis and transplant programme within the NHS."

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      Mr. Rudge referred to step-parents, about which no hon. Member has spoken yet. Can my hon. Friend the Minister say anything about step-parents being included in the legislation?
      Mr. Freeman: Under clause 2, an authority will be established under regulations. It will comprise perhaps 12 members, perhaps under a medical chairman. Its purpose is to permit, or not permit, transplants between those who are not genetically related. It is a screening mechanism prior to the transplant. It relates only to live transplants. I can give my hon. Friend the assurance that we are not making ethical pronouncements about what is or is not acceptable. In Committee, I said that I could well understand that proposed transplants between spouses, who were not therefore genetically related—or, to use my hon. Friend's example, stepchildren—would be perfectly in order. It is important that we do not send a message that, if the proposed transplants were altruistic and the tissues matched, the House or the authority would frown on them. I hope that that answers my hon. Friend's question.
      New clause 6 deals with the reporting mechanism ex post facto of all live and cadaver organ transplants. It is a separate issue. The reporting mechanism provides information and permits monitoring or "policing", as my hon. Friend said, of the intent and purposes of the Bill. The two are totally separate. The authority under clause 2 is a group of individuals, perhaps under a medical chairman. Under new clause 6, we are talking about authorities as being regional and district health authorities that gather and collect the information on transplants that have taken place.
      Amendment agreed to.
      Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 75 (Third Reading), and agreed to.
      Bill accordingly read the Third time, and passed.

  STATUTORY INSTRUMENTS, &c.

    AGRICULTURE
    Motion made, and Question put forthwith pursuant to Standing Order No. 101(5) Standing Committee on Statutory Instruments, &c.
    That the draft Cereals Marketing Act (Application to Oil Seeds) Order 1989, which was laid before this House on 7th June, be approved.—[Mr. Durant.]
    Question agreed to.

BUSINESS OF THE HOUSE
Ordered.
That, notwithstanding the practice of the House as to the intervals between stages of Bills brought in upon Ways and Means Resolutions, more than one stage of the Finance Bill may be taken at any sitting of the House.—[Mr. Durant.]

PETITION

  Channel Tunnel
  Miss Kate Hoey: I wish to present a petition which I fully support. I will read it to the House:
  To the Honourable the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled. The humble petition of citizens of Great Britain and Northern Ireland showeth that we, the undersigned constituents and supporters of CLORS oppose British Rail's plans to route Channel Tunnel passenger and freight trains on the existing overground railway line through Clapham on the grounds that we will suffer intolerable hardship and environmental damage to our lives and property.
  Wherefore your Petitioners pray that your Honourable House will urge the Secretary of State for Transport:

  (1) To order an independent environmental impact study in full consultation with all affected residents and businesses in Clapham so that the hardship we will endure can be measured and recognised.

  (2) To hold a full-scale public inquiry into the entire British Rail Channel Tunnel rail project as it affects South London, before the Private Bill is presented to the assembled Parliament.

  (3) To ensure proper consideration of sensible alternative rail schemes to fulfil the rail transport needs of the country as a whole in the light of the Channel Tunnel.

  (4) To ensure that full protection for your humble Petitioners from the effects of Channel Tunnel rail traffic and particularly of heavy freight traffic at all hours, is incorporated into any legislation authorising such traffic.

  The petition has been signed by just over 1,000 petitioners in the Clapham area.
  To lie upon the table.

Property Developers (Code of Practice)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Durant.]
10.56 pm
Mr. Peter Thurnham: This is the fourth Adjournment debate which I have been fortunate to have relating to the planning system, which shows the importance it has to my constituents and to many people in other constituencies. Indeed, it is only a few months since my hon. Friend the Member for Croydon, North-West (Mr. Malins) had an Adjournment debate on planning appeals in Croydon, when he said:
"People in north Croydon and elsewhere arc beginning to feel instinctively that the quality of their environment is deteriorating. They believe that local democracy is gradually being eroded. They have an instinctive feeling that, whenever commercial pressures and environmental interests clash, commercial pressures will win the day."—[Official Report, 17 February 1989; Vol. 147, c. 685.]
In November 1987, the ITN "World in Action" Granada television series had a programme entitled "The Planning Game". The programme made a big impact on its audience. It listed examples of how property developers are getting their own way and how aggressive developers, determined to get what they want, can exploit loopholes. It showed some examples, one of which was in my constituency.
The first example was a building that was supposed to be a stables in the green belt which had mysteriously turned into a luxurious £750,000 bungalow. The second example was of a fine meadow in flower, which had been listed as a site of special scientific interest, but which had been sprayed with weed killer and turned into a building site.
The third example featured a well-known west country developer, Mr. Mike Robertson, who was shown getting away with all kinds of abuses, and happily paying fines of £5,500 when he cut down protected trees to develop a valuable site. The fourth example showed ancient verderers' rights in the New Forest being traded off with the council for development advantages, using the private Bill procedure.
The fifth example showed Barratt as the developer using intimidating tactics with local councils to stop them objecting to its proposals. The sixth example, in my constituency, was Birtenshaw farm. It was an example of the developer—Barratt again—finding a legal loophole and getting the Secretary of State to grant planning permission, against the wishes of both the local council and his own inspectors.
I should now like to highlight the present position at Birtenshaw farm, where protesters are camped on the land preventing Barratt from moving its bulldozers, which arrived on Monday of this week. For the past 55 years, Birtenshaw farm has enjoyed the protection of a covenant restricting development on the land. My hon. Friend will be aware that I raised this matter in an Adjournment debate on 7 July 1987 and that in November last year the Government refused to waive the covenant when requested to do by Barratt. Unfortunately, Bolton council has decided not to defend the covenant, to the great dismay of the residents.
I have asked Mr. John Swanson, the chairman of Barratt, to meet me to discuss the situation, but unfortunately he has declined to do so. What sort of
576
behaviour is that, when Sir Lawrence Barratt, who is now life president of the company, says that he wants to become involved in inner-city charities or to take up public office? I appeal to him to respect the spirit of the Ashworth covenant and to give the land to the people of Bolton. I should be glad to recommend him for public office if he took that line.
In a letter to me this week the Prime Minister says:
"I can understand the disappointment of those opposed to the development of this land at finding that the covenant which they thought prevented it is no longer considered to be effective."
It may be that local public opinion could persuade the company not to go ahead with the development, despite the planning permission, but this would be entirely the company's decision. Barratt should heed this, and call off its bulldozers.
I ask my hon. Friend what he can do to revoke the planning permission at Birtenshaw farm, which now has only 12 months to run. Can he not do more to strengthen old covenants? The 1934 agreement was not fully ratified because the second world war intervened, but would my hon. Friend look at the 1986 report of the conveyancing standing committee of the Law Society, which listed five options under the heading, "What Shall we do about Old Restrictive Covenants"? Option 5 suggests compensation for those who have lost out as a result of the failure of the Land Registry properly to record a covenant. Would not that help the residents of Birtenshaw? The Royal Town Planning Institute call for a time limit on covenants of between 40 and 60 years, but surely there should be provision for renewal of covenants where they still serve a purpose.
In January 1987 the Royal Town Planning Institute issued an agenda for "Improving the Planning System for the 1990s". The agenda lists 75 items. One of these—No. 64—was for the establishment of a Planning Assessment Commission, like the Audit Commission, to monitor lapses of performance by local authorities. Another, No. 57, calls for approval by Parliament itself whenever the Secretary of State attempts to override his own inspector's report. I should have liked to see both those courses of action implemented to help the residents before the "battle of Birtenshaw" had started.
The Council for the Protection of Rural England has strongly supported my call for a code of practice to encourage property developers to abide by the spirit of the planning legislation. Indeed, it goes further and asks for legislation to put teeth into a code of practice, to enforce the recommendations of the report in February this year by Robert Carnwath QC on "Enforcing Planning Control". This follows the 1987 report by the efficiency scrutiny team which called for "unlawful development notices," supported by a "guide to procedure," to curb property developers and to help local planning authorities.
As the Granada programme said, property developers today are getting a lot more confident about their ability to get round planning restrictions. To quote the former planning officer, Mr. Proctor, they are getting "extremely brass necked". My hon. Friend is already aware of the brass neck of another developer, Mr. Robert Horrocks, who was the subject of my Adjournment debate on 10 April. There is still no improvement in Harwood precinct, where the whole community is being denied a shopping facility for which planning permission was granted many years ago.

577
I call on my hon. Friend to bring in some really tough laws to deal with these abuses. Any property developer found flouting them should be struck off. In other words, he should not be allowed to become involved in any property dealing in any shape or form. Fines of a few thousand pounds are meaningless when millions of pounds are at stake. Covenants should be properly enforced, and the new computerised Land Registry should allow for compensation by the Lands Tribunal in cases where old covenants are found now to be defective.
The British Property Federation say that its objectives are, first—not surprisingly—to look after its members' interests, and secondly, to enhance its industry's standing in the community, but the president, Mr. Mallinson, advises that the word "developer" is deemed
"synonymous with rapacity and greed."
By contributing £14 million to save archaeology, the British Property Federation can point to the success of the 1986 code of practice in protecting archaeology. That is an example of how the Government can help bring about necessary improvements in developers' behaviour.
I shall list some of the points raised by Bolton council when I drew its attention to the fact that we were to have this debate. Under the heading "Some Difficulties Created by the Present Arrangements" the council lists the following:
1. The life of a planning permission is related to the commencement of the development within a fixed period. It has been established that the digging of a simple trench capable of taking a strip foundation amounts to commencement. Hence a developer can carry out minimal site works with no intention of proceeding further and thereby extend the life of the permission indefinitely. Local examples include a hotel development proposed in the green belt.
2. Unauthorised changes of use are notoriously difficult to resolve and can involve several years of enforcement action."
It lists examples from elsewhere in Bolton.
"Stop notices may be served but there are compensation issues which make local authorities reluctant to take such steps. The unauthorised users are able to exploit the situation whereby a use can continue for a long period before action is taken in the courts.
3. Trees which are protected may be felled by a developer to whom the development potential is worth more than the fine for unauthorised felling (£2,000) or the value of the tree whichever is greater). This can be a very small price to pay for an unobstructed site.
4. Duplicate applications have been submitted recently in respect of:-

1. The Shipgates development …

2. Hill Lane, Blackrod for residential development. In neither instance did this tactic have any bearing on the outcome of the application."

The council has not listed another tactic that some developers adopt, which is that of knocking down listed buildings.
I draw my hon. Friend's attention to the great depth of feeling in my constituency, about this issue and the related issues that I have mentioned. My constituents would like to know exactly what the Government's position is and what prospects there are for legislation in the forthcoming Session to put these matters right.
In conclusion, I refer my hon. Friend to the writings of Professor Hayek, who is now 90 years old. Writing in 1960 on housing and town planning, in his book "The Constitution of Liberty", he says:
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"The practical problems which policy makers have are of great complexity, and no perfect solution is to be expected."
We understand the difficulties that the Government face, but we look forward to hearing what the Minister has to say.
I thank those who have helped me to prepare for the debate—the Library, the Royal Institute of Town Planning, the Council for the Protection of Rural England and Bolton council. I call on my hon. Friend to do what he can not only for the residents of Birtenshaw, but for all the people of this country, and bring in legislation to enforce the necessary curbs on those property developers who abuse the freedoms of the existing planning laws.
11.8 pm
The Parliamentary Under-Secretary of State for the Environment (Mr. Christopher Chope): I congratulate my hon. Friend the Member for Bolton, North-East (Mr. Thurnham) on raising this interesting topic. Once again, he has used an opportunity to raise issues of concern to his constituents, some of whom I understand are present to listen to the debate. My hon. Friend quoted Professor Hayek, saying that planning problems raise issues of great complexity and that no perfect solution is to be expected. That is helpful to me, because it means that my hon. Friend will not be disappointed by anything that I say in this speech.
I will say a few words later about the matter at Birtenshaw farm, but, before I do so, I will respond to my hon. Friend's proposal that property developers should be subject to a code of practice, and set that proposal in the context of the town and country planning system as it operates today.
Our system of town and country planning has its origins in the Town and Country Planning Act 1947. That Act was updated and consolidated in 1962, and again in 1971, but the essence of the system has stood up well to the test of time.
The 1947 Act took away many of the rights of an individual to develop his land in the way that he wanted. It gave local authorities primary power to decide whether planning permission should be granted. It has long been established that planning permission should be granted unless the development proposal would harm an interest of acknowledged importance, and reasons for refusal should always be well founded and clearly defined. In the 1947 Act, Parliament provided the right of appeal to the Secretary of State if the local authority turned down a planning application.
That right of appeal was in recognition of the fact that rights to develop land have been taken away. The 1947 Act took no rights from third party objectors. Indeed, it gave them a right that they retain today, which is the opportunity to express their views about development proposals, and to have them taken into account by the local authority or the Secretary of State when planning applications and appeals are decided.
My hon. Friend has argued eloquently the case for local opponents of development proposals. I should like to invite him to consider the planning system from the developer's point of view.
There are many types of property developer. A developer may be an individual householder who wants to extend his house to provide more space for a growing family. He may be a small business man who needs to extend his premises to expand his firm and provide more

579
jobs. He may be an industrialist wanting to modernise factory premises. He may be a retailer, keen to improve the quality of shopping space for the consumer. He may be a volume housebuilder providing houses in which people want to live.
Any developer has to put in an application for planning permission. If the local authority turns down the application or fails to issue a decision on it within eight weeks, the developer can appeal to the Secretary of State.
At present, largely because of the strength of the national economy, local authorities in England and my Department have experienced a considerable increase in the numbers of planning applications and appeals. The number of appeals received in the Department last year was 28,500, compared with fewer than half that number in 1983.
Inevitably, handling a huge volume of appeals takes time, and a developer whose planning application is refused and who then goes to appeal is likely to have to wait many months, from the time he first puts in his planning application to the local authority to the day he receives a decision letter on his appeal.
For a developer who has purchased an interest in land, and so has capital tied up in his development proposal, such delay can be extremely costly. The Government wish to reduce the time taken to deal with planning applications and appeals, while ensuring that the quality of the decisions is maintained. I am sure that my hon. Friend will agree that a good decision is often the one that is taken swiftly. A decision is not necessarily improved by the months that are often taken deliberating over it.
Nevertheless, it is important that development proposals should receive both professional scrutiny and appropriate publicity. There is an opportunity for the public to participate in the planning process, whether by writing letters of objection to the local planning authority or the Secretary of State, or by taking part in a public local inquiry into development proposals.
The Government have advised local authorities that any relevant views expressed by local residents should be taken into account in determining planning applications. Nevertheless, on its own, local opposition to a proposal is not a ground for refusing planning permission, unless that opposition is founded upon valid planning reasons supported by substantive evidence. The substance of local opposition must be considered, but the duty is to decide each case on its merits.
It also has to be said that the purpose of the planning system is to regulate the development and use of land in the public interest. It is not to protect the private interests of one person against the activities of another. The material question is whether a development proposal would affect the locality generally and unacceptably affect amenities that should be protected in the public interest.
I can understand that my hon. Friend wants planning legislation to be tightened up. He has referred to a code of practice to be enshrined in legislation, with the objective of ensuring that developers are more responsive to the views of local people.
I have sought to explain how the planning system is already highly responsive to local opinion. The existing legislation makes local authorities responsible for preparing a local development plan for their areas, and for deciding planning applications. The Government want as many planning applications as possible to he determined locally. I am pleased to say that, at present, over 98 per
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cent. of planning permissions are granted by local authorities. That means that fewer than 2 per cent. of planning permissions result from decisions by my right hon. Friend or his inspectors on appeal. Only one third of rejected planning applications go to appeal, and nearly two thirds of appeals are then unsuccessful. Those figures demonstrate that planning is a local activity in practice, as Parliament intended.
My hon. Friend will know that the Government are not complacent about planning legislation. In January, we published a White Paper entitled "The Future of Development Plans," which contained firm proposals for requiring local planning authorities to prepare local plans for the whole of their areas.
The existence of an up-to-date districtwide local plan, which will have been the subject of extensive public consultation, should ensure that the local authority's decisions on development proposals are far less susceptible to revision on appeal. It should also lessen the number of appeals. That would enable local planning authorities and the Department to give all the consumers of the planning system, including developers and local objectors, a better standard of service.
My hon. Friend referred to the issue of planning enforcement, and he is right to say that if we are to have a system of planning which enjoys the confidence of the people it must be backed by enforcement procedures that are seen to be effective. A review was undertaken by Robert Carnwath QC. He produced his report in February. It contained a number of recommendations, which have been widely supported, for improving the the system. The Government have published a consultation paper about the recommendations, and we have received a number of comments on it. I assure my hon. Friend that we will bring forward legislation on those matters as soon as parliamentary time permits.
1 shall consider my hon. Friend's arguments about the need for a code of practice to regulate developers' behaviour. Inevitably, there will be some developers whose standards of behaviour fall short of expectations. That is why Parliament has provided enforcement powers. But it is not only some developers whose behaviour may fall short of an expected standard. The same is true in all sectors of human activity.
My hon. Friend referred to the issue at Birtenshaw farm. He has left no doubt that he and many of his constituents in the Bromley Cross and Bradshaw areas of Bolton strongly oppose that development. Local people showed that by their actions last Monday, when they succeeded in preventing the developer from beginning work on the site.
I can readily imagine the disappointment of local people when it became known that a covenant which was made in 1934, which seemed to ensure that the land would remain open, was not thought to be enforceable after all. That news must have been particularly depressing to local hopes for the site, because it came soon after the Secretary of State had rejected Barratt's request to remove the restriction contained in the covenant.
That covenant was an entirely separate issue from the matter of planning permission. The decision to retain the covenant did not affect the planning appeal decision to grant planning permission; nor was it a comment on the merits of the appeal decision.
Barratt is now left with a planning permission which it obtained after properly completing all the relevant

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planning procedures. If there are no other legal restrictions on developing the land, which it now appears there are not, it is fully entitled to implement that permission.
I listened carefully to what my hon. Friend said about the case, but it does not seem to me that there are any grounds for believing that Barratt has in any way acted improperly in the matter. My hon. Friend is entitled to his view of the scheme and to oppose it vigorously through all the legal means open to him, as he has done. Equally, Barratt is entitled to seek to carry out a scheme for which it has obtained planning permission.
Planning procedures provide opportunities for opposing opinions to be expressed and considered before decisions are taken. The trouble in the Birtenshaw farm case was not that such opportunities were not provided, but that the outcome was unwelcome to many local people. That does not indicate any fault in the planning system. Unwelcome decisions often have to be taken. Nor does it indicate to me a need for the imposition of a code of practice on top of the planning system. Indeed, I find it difficult to visualise a code that would operate to deter a developer from proceeding with work which he is entitled to carry out in accordance with a valid planning permission.
My hon. Friend asked whether my right hon. Friend would intervene to revoke the planning permission that exists for the development at Birtenshaw farm, or to convene a public local inquiry. I have heard nothing to convince me that such action would be justified. There are statutory powers available to revoke planning permission, but my right hon. Friend has used his power only extremely rarely. He takes the view that the power should be used where the original decision is judged to be so grossly wrong that damage is likely to be done to the wider public interest. I think that my hon. Friend knows that it
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is open to the local authority to initiate revocation procedures. If the authority seeks to do that, there is a well-established procedure and, following on from that procedure, a system of compensation. Some people are under the misapprehension that if, for example, my right hon. Friend were to seek to revoke the planning permission himself, he would be landed with the bill for paying the compensation. I must tell my hon. Friend that, even if my right hon. Friend were to initiate the revocation procedure, the bill for any compensation that might result would have to be met by the local council—in other words, by the local ratepayers, or the community charge payers with effect from April of next year. If the local council and the local people want to start revocation proceedings, there is nothing to stop them doing that. I can understand that that might lead to a lively debate in the Bolton council chamber.
I believe that in general the existing system of planning control provides sufficient checks and balances. Developers, local authorities or third party objectors do not have carte blanche to ride roughshod over the planning system. If there is to be a code of practice, it should surely be a voluntary one drawn up by property developers—for example, the British Property Federation. My hon. Friend has referred to the voluntary code that was drawn up to deal with sites of archaeological importance, which I believe is an important code of practice.
My hon. Friend also referred to a number of other initiatives which he believes could be taken to improve the effectiveness of the planning system. I assure him that some of those ideas are very much in the forefront of the Government's mind, as we move towards what we hope will be an early legislative opportunity to reform our planning system.
Question put and agreed to.
Adjourned accordingly at twenty-one minutes past Eleven o'clock.