Commons Sitting of 24 July 1989

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

    NEW SOUTHGATE CEMETERY AND CREMATORIUM LIMITED BILL
    Orders read for consideration of Lords amendments.
    To be considered on Thursday 27 July.

    QUEEN MARY AND WESTFIELD COLLEGE BILL [Lords]
    Orders for consideration read.
    To be considered tomorrow.

Oral Answers to Questions
  ENERGY

    British Coal
    Mr. Andrew Mitchell: To ask the Secretary of State for Energy what is his estimate of the date upon which British Coal will break even.
    The Secretary of State for Energy (Mr. Cecil Parkinson): I will be reviewing British Coal's financial prospects with the corporation once its current negotiations with the generating companies are concluded. I cannot anticipate the outcome.
    Mr. Mitchell: Does my right hon. Friend accept that the contracts will be inextricably linked to British Coal's ability to break even? Does he agree that it is important to apply both the carrot and the stick to an industry whose productivity has risen by nearly 50 per cent. during the past three years? Did he notice the enthusiasm and dedication of the Nottinghamshire mineworkers when he visited the county last week, and is he aware of the considerable approval of and gratitude for his visit that is felt among mineworkers generally and by the miners of Thoresby?
    Mr. Parkinson: I thank my hon. Friend for his kind remarks. I enjoyed my visit to Thoresby. I was impressed with the enthusiasm with which the men there are using the new equipment and the big investment that has been made. They are doing the very thing that is guaranteed to safeguard a good future for them. They are an outstanding example of how the industry can secure its future.
    Mr. Allen McKay: When does the Secretary of State expect to write off the interest charges—before or after privatisation?
    Mr. Parkinson: Of course, one cannot anticipate the Queen's Speech, but I expect proposals to come forward in the very near future—certainly later this year—for the restructuring of British Coal's finances.
    Sir Trevor Skeet: May I re-emphasise to my right hon. Friend the need to have a capital restructuring, which is absolutely vital for the industry? Is my right hon. Friend aware that we have been talking about breaking even for the past 20 years, but that we have never been able to achieve it?
    Mr. Parkinson: One reason for that is the high interest charges borne by the industry. It has received nearly £10 billion in deficit grant and subsidy in recent years. However, its capital structure is not satisfactory. It has no reserves. Every time a pit closes, the cost is added to the negative reserve. The answer is restructuring and, as I have already said, I expect the Government to come forward with proposals.
    Mr. Barron: When the industry is restructured, will the Secretary of State make sure that comparisons of the costs of British coal are not made against the marginal cost of coal on the international markets, in view of the answer that he gave me in 1987—that if the international markets were to supply the Central Electricity Generating Board, it would substantially increase the cost? Will he assure the House that the actual costs of production will not be compared with the marginal costs of international coal?
    Mr. Parkinson: The hon. Gentleman is absolutely right. It is a mistake to take the lowest price at which one can buy coal on the spot market and say that that is the world price. As he knows, if the CEGB were to go into the market for 80 million tonnes, it would shift the world price considerably. I am glad that on this occasion he and I can agree.

    Renewable Energy
    Mr. McCartney: To ask the Secretary of State for Energy what is his latest estimate of the potential for electricity generation from renewable sources in the north-west of England.
    Mr. George Howarth: To ask the Secretary of State for Energy what further studies he expects to authorise on renewable electrical energy potential in the north-west of England or other regions.
    Mr. Campbell-Savours: To ask the Secretary of State for Energy if he will make a statement concerning renewable energy sources for electricity generation in the north-west of England.
    The Parliamentary Under-Secretary of State for Energy (Mr. Michael Spicer): The recent report of the North-Western electricity board and the energy technology support unit estimates the potential for electricity generation from renewable energy sources in the NORWEB area to be equivalent to 400 MW of conventional base load plant at costs up to 3p per kWh, excluding connection costs. The board is currently considering the next steps.
    Mr. McCartney: I welcome the NORWEB initiative and report. Is it not astonishing that after privatisation, by the year 2000, only 1 per cent. of capacity will come from renewables, yet the report shows that 10 to 12 per cent. of NORWEB's capacity could come from renewables? As methane gas has one of the worst effects on the greenhouse problem, should not the Department of Energy be promoting a nationwide programme for using rubbish tips and harnessing methane gas as an alternative to the nuclear industry, which is expected to produce 15 to 20 per cent. of electricity. We could then ensure that methane gas was used by NORWEB and other companies so as not to destroy the atmosphere.
    Mr. Spicer: I do not know where the hon. Gentleman gets his figure of 1 per cent., but I can tell him that no Government have done as much as this one for renewable energy, not only in sponsoring research, but in providing for the non-fossil fuel obligation, which will give a special chance for renewable energy. Renewable energy has never been so protected as it will be in the future. I hope that the hon. Gentleman will welcome that.

    Energy Saving
    Mr. Jack: To ask the Secretary of State for Energy what private sector initiatives there are in the field of energy saving.
    The Minister of State, Department of Energy (Mr. Peter Morrison): There is now a well-established energy efficiency industry operating and taking initiatives in the private sector.
    Mr. Jack: Will my right hon. Friend join me in congratulating a company in my constituency, Inenco, which for the past 21 years has been investing in energy management, to the extent of £2·3 million in saving systems, which in turn have saved £1 million worth of energy? Does he agree that that excellent example of a private sector initiative shows what can be done in energy savings?
    Mr. Morrison: I agree with my hon. Friend that Inenco deserves a very good 21st birthday present. I am glad to say that where that company has gone, so have many others.
    Mrs. Roe: Is my right hon. Friend aware that horticulturists are among the most efficient users of energy, yet their operations are threatened by the large increase in gas prices?
    Mr. Morrison: I am aware of that, not least because my hon. Friend, with another of my hon. Friends, discussed with me the position of the glasshouse industry. She knows that Ofgas is in discussion with British Gas at present about the predicament that she mentioned.

    Insulation
    Ms. Quin: To ask the Secretary of State for Energy what discussions he has had on the desirability of setting a minimum target for the number of low-income households to be insulated in the current year and next year.
    Mr. Peter Morrison: The number of low-income households insulated is largely determined by the
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    availability locally of unemployed people requiring training in those occupational or skill areas which the projects can provide. Against that background, it would not be appropriate to set a minimum target.
    Ms. Quin: Will the Minister confirm that there has been a 50 per cent. reduction in the number of low-income households that have been insulated during the past year since the introduction of employment training? Will he urgently consider ways of expanding such schemes and urge his colleagues to increase the funding to local authorities, so that they can increase the number of schemes that they operate?
    Mr. Morrison: I confirm that there was a reduction during the transition from the community programme to employment training. However, the hon. Lady will be aware that my right hon. Friend the Secretary of State for Employment considered this matter carefully and increased the grant by £40. Since that time it appears that the take-up of the scheme under employment training has been good, and I know that my right hon. Friend is looking carefully at continuing that grant.
    Mr. Morgan: May I re-emphasise to the Minister how important it is to insulate low-income households because of the likelihood that, during the period before privatisation and afterwards, their electricity bills will increase by about 50 per cent. or more? I draw to the Minister's attention the case of my constituent, Mr. John O'Connor of Ashcroft crescent, Fairwater, Cardiff, which was brought to my attention on Saturday. He was told in his most recent electricity bill that his monthly payment on or after 25 September will be £27·50. That is a 55 per cent. increase on Mr. O'Connor's previous quarterly bill and on the average of the four previous quarterly bills that he has received.
    When I received my quarterly bill at the same time I was told that if I changed to a monthly budget account my bill "would be" £91·50 per month. That is a larger increase than that faced by Mr. O'Connor, but at least I was given the option by being told what my bill "would be" if I switched to a monthly budget account, whereas pensioner households on council estates are being told, "Your bill will be going up by 55 per cent. from September". Does the Minister agree that it is absolutely urgent that low-income households are fully insulated and that the practices of the South Wales electricity board are reviewed?
    Mr. Morrison: First, I am glad that the hon. Gentleman agrees with my right hon. Friend the Secretary of State for Employment on his insulation initiative.
    The hon. Gentleman will appreciate that this is the first time that he has mentioned the case of his constituent, Mr. O'Connor, but I shall be perfectly happy to look into the matter. Perhaps he would like to write to me or come to see me about it. He will appreciate, however, that electricity bills have not increased by anything like 50 per cent.

    Fossil Fuels (Pollution)
    Mr. Lofthouse: To ask the Secretary of State for Energy what discussions he has had regarding means to offset the cost of air pollution from the burning of fossil fuel.
    Mr. Parkinson: I regularly receive representations on environmental questions and discuss them with a wide range of interests.
    The Government are committed to reducing acid emissions from the burning of fossil fuel and, for example, a £2 billion investment programme is planned by the electricity supply industry to meet new standards agreed with the European Community.
    Mr. Lofthouse: Does the Secretary of State agree with the recent report of the Select Committee on Energy on the greenhouse effect which concluded that the nuclear industry would not have the advantage in reducing the greenhouse effect and that the Government should not overstate the nuclear argument? Does he agree that the best way forward is to find the most efficient method of burning fossil fuel? Methods are being investigated, but because of the underfunding of plants such as Grimethorpe, that investigation is unable to progress. On Thursday, the Under-Secretary of State refused to give a definite assurance that that plant would be financed. Will the Secretary of State assure the House that Grimethorpe will continue to be funded by Government money?
    Mr. Parkinson: As the hon. Gentleman knows, we are trying to put together a package—I am extremely optimistic that we will succeed—of finance to keep the project active and to bring it to a successful conclusion. I cannot anticipate the outcome of my arguments and discussions with the Treasury, but I am optimistic.
    We will, of course, reply to the Select Committee report, but we do not take the view that there is one answer to the greenhouse effect. We believe that the answer will be found in a variety of ways through cleaner coal burn, nuclear power and the extension of renewables—the hon. Member for Makerfield (Mr. McCartney) mentioned the burning of waste gas. We have 45 projects on the stocks and we should be producing nearly 50 MW of electricity from waste gas next year. In a variety of ways, therefore, we shall tackle the problem of the greenhouse effect. I agree with the hon. Gentleman that one such solution is cleaner coal burn.
    Mr. Hannam: Does my right hon. Friend agree that one of the important future methods of reducing pollution from coal burn will be gasification? How is gasification developing and how near are we to its use?
    Mr. Parkinson: We are backing research into this matter because my Department takes the view—I have said this many times—that coal is one of our most important indigenous resources. We must find cleaner ways in which to use it, and gasification is one of them.
    Mr. Malcolm Bruce: Does the Secretary of State accept that when more stringent sulphur controls are imposed on nuclear power stations—the sooner it happens the better—that will encourage the burning of low sulphur coal? In those circumstances, and given the pressure on British Coal as the Minister pushes it towards privatisation, does he agree that the forced closure of many coalfields in Scotland that produced low sulphur coal has been a mistake? Will he respond, even now, to my suggestion that he should review the likely premium for low sulphur coal when full restrictions are in force? That review might, at least, salvage some of the Scottish coalfields.
    Mr. Parkinson: As the hon. Gentleman knows, closures are a matter for British Coal, which examines each case in detail before arriving at its decision whether to close. I agree that low sulphur coal has a role to play, but since the vast majority of our reserves are high sulphur coal we see the flue gas desulphurisation equipment as a way of guaranteeing a continuing market for the main body of British coal.
    Mr. Redmond: The Secretary of State mentioned the financial package for Grimethorpe. If that package fails, will he stand guarantor so that, irrespective of whether the package is put together, the Government will continue to ensure adequate finance?
    Mr. Parkinson: I do not personally have the means to stand guarantor, but I am extremely optimistic: I find that the Treasury is inclined to listen if one has a good case and puts it sensibly. I am extremely optimistic that we shall be successful in our negotiations.
    Mr. Dickens: Does my right hon. Friend agree that the power of the wind is perhaps that most ozone-friendly of all means of creating power? Although wind farms and large offshore windmills may seem commercially very unattractive at the moment, in years to come when the coal has run out, and gas oil wells have dried up, windmills may prove one of the big sources for the future.
    Mr. Parkinson: My hon. Friend makes an important point. The problem with windmills is that people who are enthusiastic about the prospects of producing electricity from them hate having them anywhere near their homes. One reason why we are sponsoring three projects with the CEGB is to find out whether the public will accept large wind farms, because they are undoubtedly environmentally intrusive, even though the electricity that they produce is welcome.
    Mr. Blair: Will the Secretary of State comment on the reported collapse of the Leicester combined heat and power scheme because, as the chairman of the consortium said, there would be no effective competition in electricity generation after privatisation? If that is right, is it not a fairly damning indictment not merely of the Government's environmental policy but of their privatisation proposals.?
    Mr. Parkinson: It looks as though the Leicester project is not going to happen, simply because of the economics. The plain fact is that it cannot produce a project that will provide electricity at any sort of economic price. But there are many other projects with good economic prospects. I am sorry to disappoint the hon. Gentleman: there will be substantial independent generation in the future.

    Energy Efficiency
    Mr. Speller: To ask the Secretary of State for Energy if he will list those forms of additional assistance with energy efficiency work made available since 1 July 1988, listing those which have been discontinued since that date.
    Mr. Peter Morrison: My right hon. Friend the Secretary of State announced on 7 March a new best practice programme which aims to spread and advance best practice in energy efficiency. This programme began on 1 April and replaced the energy efficiency demonstration and research and development schemes.
    Mr. Speller: My right hon. Friend has not precisely answered the question, which was whether he would list forms of additional assistance. I am well aware of the packages. Does he accept that there are two predominant forms of energy efficiency which we should seek to encourage: first, energy audit in the home and the workplace, to save some fuel; and, secondly, energy labelling on all machinery and appliances, to save energy and costs and, in the long term, to reduce the need for new generation?
    Mr. Morrison: I agree with my hon. Friend in this respect: it is up to the individual, company or commercial organisation to see to their own energy efficiency, and that is where our programmes are directed. However, I would not go the whole way with my hon. Friend's suggestion. It would entail unnecessary bureaucracy which could prove tedious and turn people against energy efficiency.
    Mr. Gow: Does my right hon. Friend agree that the public sector is setting the most appalling example of the economic use of energy? If he will look above him, he will see 150 powerful lights burning to keep this Chamber illuminated to a degree which is quite unnecessary. If my right hon. Friend goes round Government Departments in London and outside it, he will find, on the brightest day of the year at 12 noon, lights on in almost every building. Will he do something serious about this appalling waste?
    Mr. Morrison: I always try to follow my hon. Friend's example. I know that when he was a Minister he assiduously used to go round his Department turning out unnecessary lights. We should all follow that example. I hope that he was pleased with the announcement on 20 July by my right hon. Friend the Secretary of State for Energy. In answer to my hon. Friend the Member for Exeter (Mr. Hannam), who asked whether he would make a statement on the campaign to promote energy efficiency in the public sector, my right hon. Friend gave a long answer which promoted precisely what he, I and my hon. Friend the Member for Eastbourne (Mr. Gow) would want.

    Toilets (Pits)
    Mr. Harry Barnes: To ask the Secretary of State for Energy what is the total increase in underground toilet facilities in British Coal pits in the last year.
    Mr. Michael Spicer: This is a matter for British Coal, which has between two and six lavatories in each of its collieries.
    Mr. Barnes: The Minister will be aware that the Employment Act 1989 means that many women may be obliged to work down the pit or lose benefit. In that event, should there not be adequate toilet facilities in the pits? It is clear from the Minister's answer that such facilities are often primitive, inadequate or some considerable distance from the work face.
    Mr. Spicer: I am aware of the hon. Gentleman's interest in this matter because of his membership of the Standing Committee that discussed the Employment Bill. I have read the Committee's reports. I assure him that the two to six lavatories per pit could easily be converted for use by women. As to why existing ones are not used, I invite the
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    hon. Gentleman to accompany me on my next visit to the pits and we can endeavour to find out why more miners do not use the lavatories that are provided for them.

    Electricity Privatisation (Advisers)
    Mr. Sedgemore: To ask the Secretary of State for Energy if he will accept the recommendation of the Energy Select Committee that the terms of remuneration of each adviser he has employed on electricity privatisation should be provided to the Select Committee.
    Mrs. Clwyd: To ask the Secretary of State for Energy whether he will publish a statement on the responsibilities, selection, basis of remuneration and method of contract appraisal of the advisers he is currently employing on work related to the privatisation of the electricity supply industry.
    Mr. Parkinson: As the hon. Member knows, we give careful consideration to all recommendations made by the Select Committee on Energy. The Government will give their considered response in due course.
    Mr. Sedgemore: Bearing in mind the fact that last year the Government spent £6 million on advisers' fees—the equivalent of employing 220 people—and that this year they intend to spend the equivalent of employing 870 advisers, it is not scandalous that Parliament is not given the information that it needs to decide whether it is getting value for money? Vast sums are being paid to Kleinwort Benson and Slaughter and May for doing God knows what and for God knows how much.
    Mr. Parkinson: We are embarking on the huge enterprise of privatising and restructuring this massive industry. Although that information is not made available in detail to the Select Committee on Energy, it is of course available in total to the National Audit Office, which has the right and the duty to examine every item of public expenditure and say whether the Government are getting good value for money. Parliament is being accounted to, in the way that it requests, through the National Audit Office and the Public Accounts Committee.

    Carbon Fuels (Tax)
    Mr. Thurnham: To ask the Secretary of State for Energy whether he has received any recent representations about a tax on carbon fuels.
    Mr. Parkinson: I have received several letters from hon. Members, on behalf of their constituents, on this matter. In my replies, I have assured them that the Government have no plans for such a tax.
    Mr. Thurnham: Has my right hon. Friend had any discussions with other countries? Clearly it would be uncompetitive for our energy-using industries to pay a tax on carbon fuels if industries in competitor countries did not do the same.
    Mr. Parkinson: We are active members of the intergovernmental panel on climate change which is due to report on these matters by the middle of next year and will be taking a view about whether international initiatives can be taken. My hon. Friend is right; for us to put ourselves at a disadvantage by making a totally individual

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    gesture would be pointless. We are active supporters of the IPCC and will work hard to make sure that it comes up with some worthwhile schemes.
    Mr. Ashby: There is a local tax in the form of a tonnage extraction rate. Will my right hon. Friend undertake to publish, for each coalfield and each opencast mining operation, the amount of tonnage rate that is paid?
    Mr. Parkinson: I shall write to my hon. Friend about that matter.

    Carbon Dioxide Emissions
    Ms. Mowlam: To ask the Secretary of State for Energy if he will publish the most up-to-date figures available from the United States Department of Energy Oak Ridge laboratories on carbon dioxide emission levels in the United Kingdom, France and West Germany for the two most recent years available.
    Mr. Michael Spicer: According to the Oak Ridge laboratory report the United Kingdom, West Germany and France are responsible for about 2·8 per cent., 3·3 per cent. and 1·7 per cent. respectively of the world's non-biogenic emissions of CO2. I will circulate a fuller answer, including a table of figures, in the Official Report.
    Ms. Mowlam: That selective use of the figures does not give us a true picture of the comparative level of carbon dioxide emissions by Britain, France and West Germany. Will the Minister tell us clearly whether Britain's emissions of carbon dioxide are higher than those of West Germany or France? A straight yes or no answer will be sufficient.
    Mr. Spicer: No, Sir.
    Mr. Harry Greenway: Does my hon. Friend believe that his Department has responsibility for collaborating with other Departments to plant more trees, which alone can take in carbon dioxide and breath out oxygen, and so overcome the problem that we all fear so much?
    Mr. Spicer: As my hon. Friend has implied, my Department is not responsible for planting trees, but various aspects of our policies are aimed at reducing the increase in CO2 emissions, in particular our policy on the nuclear power industry. Some arguments suggest that the nuclear industry produces some CO2, but even the Friends of the Earth cannot present figures that show that it produces more than 4 per cent., far less than that produced by the coal industry.
    The following is the information: The Oak Ridge national laboratory maintains a computer database of global CO2 emissions, including estimates for individual countries, covering the period from 1950 onward. A report on this database was published earlier this year and I will arrange for a copy to be deposited in the Library of the House. Since publication of the report, however, the database has been updated to include 1987 data and revisions to earlier data.
    The latest estimates of carbon dioxide emissions in France (including Monaco), West Germany, the United Kingdom and the world as a whole, produced by Oak Ridge national laboratory, are given in the table for the two most recent years available. These emissions relate only to the combustion of fossil fuels and to emissions
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    from cement manufacture and are expressed in million tonnes of carbon. The individual country estimates also exclude some emission sources such as bunker fuels.
    All such estimates are of course subject to some uncertainty and Oak Ridge has estimated that even the global annual totals are subject to an uncertainty of 6 to 10 per cent. Figures for individual countries will be subject to even greater uncertainty because, for example, the estimates are based on global average carbon emission factors.
    I have therefore provided a table giving the latest official estimates of United Kingdom emissions which are compiled by Warren Spring laboratory. These are compiled using a more detailed methodology and should therefore provide a truer picture of the United Kingdom situation. They also include emissions due to gas flaring at oilfields and other sources such as bunker fuels and incineration, which are not included in the Oak Ridge data.

    CO2 Emission estimates compiled by Oak Ridge laboratory

    1986

    1987

    West Germany

    184·9

    181·5

    France

    98·2

    94·7

    United Kingdom

    152·5

    156·1

    Global Total

    5512

    5599

    United Kingdom CO2 Emission estimates compiled by Warren Spring laboratory

    1986

    1987

    Total United Kingdom

    165·5

    166·3

    Notes:
    1. All figures expressed as million tonnes of carbon.
    2. All figures for individual countries rounded to one decimal place and the global total rounded to the nearest million tonnes but this does not necessarily reflect the precision of the data.
    3. Oak Ridge figures include emissions from fossil fuels and cement manufacture only and individual country estimates exclude bunker fuels. Warren Spring figures include emissions from additional sources such as gas flaring at oil fields, incineration and bunker fuels.
    4. Figures for France include Monaco.

    Regional Electricity Boards
    Mr. Pike: To ask the Secretary of State for Energy what matters he proposes to discuss with the chairs of the regional electricty boards when he next meets them.
    Mr. Parkinson: I regularly meet the area board chairmen to discuss various matters of mutual interest.
    Mr. Pike: When the Secretary of State next meets the chairmen of regional boards, will he discuss why boards such as NORWEB have reduced the number of inspectors that they employ and, for example, no longer inspect empty properties before they are reconnected to the electricity supply? Is that not an example of how, as the industry moves towards privatisation, profit becomes more important than safety?
    Mr. Parkinson: I do not accept that. I have visited NORWEB on a number of occasions and I think that the improvement in its standards of service to its customers is remarkable. For instance, it has improved the level of disconnections, and that is again remarkable. It is preparing itself to give better service and is not doing so by taking any risks with safety.
    Mr. Favell: When my right hon. Friend next meets the chairman of NORWEB, will he discuss the proposal to phase out Europa house in Stockport, where 600 or 700 people are employed? Does this new proposal arise out of privatisation? Are the rumours true that jobs are to be moved from Stockport, where unemployment is relatively high, to Swindon, where there is virtually none?
    Mr. Parkinson: I cannot give my hon. Friend an answer to that. It has not been raised with me before and as he knows, I am not responsible for the day-to-day running of area boards. That is why there are boards of directors. However, I shall find out the answer and write to my hon. Friend.
    Mr. Hardy: Will the Secretary of State discuss with the chairman of regional boards who is to pay for the scandalous waste that is about to be experienced, as all Wellington boots, donkey jackets, overalls, crockery, crested paper and so on bearing the emblem of the CEGB are replaced by goods bearing the logo of the new companies? Does the Secretary of State expect the customer to pay for that in advance of privatisation?
    Mr. Parkinson: It has always been the practice in the electricity industry to promote the corporate identity of the industry. The idea that something new is being done is wrong. As a small example, in the last year of Labour Government, the equivalent of £57 million was spent on advertising, the object of which was to steal business from another national industry, the gas industry.
    Mr. Douglas: Does the Secretary of State concede that when he can meet the chairmen of the electricity boards of England and Wales, he can discuss problems of mutual interest between them and British Coal? That, however, does not apply to Scotland. Nonetheless, there is a matter of considerable interest involving the South of Scotland electricity board and British Coal. When will the Secretary of State be able to resolve the important coal contract between that board and British Coal?
    Mr. Parkinson: As the hon. Gentleman knows, that is very much a matter for the two parties. The Government have used their good offices to some effect—I think that the hon. Gentleman will agree with that—to maintain coal production in Scotland. We hope to see an agreement between the two parties in the near future.

    United Kingdom Atomic Energy Authority
    Mr. Butler: To ask the Secretary of State for Energy what scope he envisages for the diversification of the business of the United Kingdom Atomic Energy Authority.
    Mr. Michael Spicer: The Atomic Energy Authority has decided to restructure its activities into a series of distinct businesses under the new corporate identity of AEA Technology. The businesses will be focused on the areas of work with the best commercial prospects. I welcome these developments.
    Mr. Butler: Will my hon. Friend confirm that with the downgrading of the fast breeder reactor programme all is not doom and gloom with the AEA, and that its prospects could be extremely positive in the near future?
    Mr. Spicer: I can confirm, as I said in my main answr, that there are prospects that the AEA is exploring assiduously which would restructure its business to make it extremely commercial.
    Mr. Allan W. Williams: We know how desperate the AEA is to try to diversify its business and to try to improve its public image, but will the Minister dissuade it from entering the business of food irradiation? I understand that the Government are thinking of lifting the ban on food irradiation although there is serious public concern about the safety of irradiated food products. The British Medical Association opposes the irradiation of food.
    Mr. Spicer: I cannot at this moment give any commitments to that effect to the hon. Gentleman, but I have listened to what he has said.

    Nuclear Power Stations (Valuation)
    Mr. John P. Smith: To ask the Secretary of State for Energy what is his most up-to-date valuation of the nuclear power stations of England and Wales.
    Mr. Michael Spicer: The market value of the electricity supply industry will depend on a number of factors such as market conditions at the time of the sale, the profitability of the companies and their prospects. It is premature to speculate on the likely level of proceeds.
    Mr. Smith: Will the Minister kindly explain to my constituents who work at the coal-fired power station at Aberthaw how they can be expected to compete equally and fairly with nuclear power stations when so much has to be written off from the value of power stations when they are transferred and sold off to the private sector? Surely my constituents at Aberthaw will be competing with one hand tied behind their backs?
    Mr. Spicer: The hon. Gentleman prejudges how the balance sheet will be structured for the privatised companies. We have not said how we shall restructure them. We do not know yet what the state of the market will be when we come to privatise the companies. I can tell the hon. Gentleman in direct answer to his supplementary question, which related to the protection of the coal industry as against the nuclear industry, that we spend £2 million every working day on investment—a large chunk of that is from the public sector in the form of taxpayers' money—on the coal industry. If that is not a protected industry, I do not know what is. We are getting slowly to a position where it will be able to stand on its own feet.

    Greenhouse Effect
    Mr. Barron: To ask the Secretary of State for Energy what steps he is taking to reduce greenhouse gas emissions from the generation of electricity.
    Mr. Michael Spicer: Current policies and initiatives are intended to limit the emission of greenhouse gases. The encouragement of cost-effective energy efficiency measures, the development of renewable energy resources, our support for nuclear power, and the diversified and efficient supply options in the Electricity Bill are a firm basis for any future action.
    Mr. Barron: Without repeating what has been said already, is not the hon. Gentleman's answer unconvincing

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    when we recall that on Thursday the Government removed from the Electricity Bill the only real teeth in that measure for ensuring that there is energy efficiency and conservation?
    Mr. Spicer: The hon. Gentleman knows that the Electricity Bill, which we shall be debating further later this afternoon, has two major features connected with energy efficiency. The first feature is that the entire industry is to be restructured to bring forward the most efficient forms of energy production. Secondly, for the first time in the United Kingdom's history, we shall have built into legislation requirements on the regulator to promote the interests of energy efficiency. That is a major step forward. It is extraordinary that the Opposition still fail to understand that important point.
    Mr. Alan W. Williams: To ask the Secretary of State for Energy what research has been conducted into British public attitudes towards the role of nuclear power in tackling the greenhouse effect; and if he will make a statement.
    Mr. Michael Spicer: No such research has been carried out on behalf of my Department.
    Mr. Williams: Does the Minister recognise that no matter how often he, the Prime Minister and the Secretary of State for the Environment—or perhaps the ex-Secretary of State—repeat the nonsense that nuclear power is the solution to the greenhouse effect, the general public have rumbled them and believe that spending money on energy conservation rather than nuclear power makes much better economic sense and plays a much greater part in tackling the greenhouse effect?
    Mr. Spicer: The Government agree that energy efficiency has its part to play, which is precisely why I gave the answer that I did to the hon. Member for Rother Valley (Mr. Barron). The hon. Gentleman, for various reasons, may not like the nuclear industry, but I am surprised that he is not prepared to accept the facts. Electricity produced through the nuclear industry accounts for only 4 per cent. of CO2 emissions even taking into account the Friends of the Earth figures. That is far less than the level produced by the coal industry. If the hon. Gentleman cannot understand that fact, I cannot understand how he can raise such a question.

  ATTORNEY-GENERAL

    Mr. Colin Wallace
    Mr. Livingstone: To ask the Attorney-General, pursuant to his answer to the hon. Member for Brent, East of 29 June, Official Report, column 507, if he will make a statement on the contents of the letter to the Director of Public Prosecutions dated 7 March from the chief constable of the Sussex police concerning the circumstances surrounding Mr. Colin Wallace's conviction for manslaughter.
    The Attorney-General (Sir Patrick Mayhew): No, Sir.
    Mr. Livingstone: Does the right hon. and learned Gentleman's refusal to make a statement mean that he is satisfied with the 10 questions that I put to the chief constable of Sussex about collusion to create identical police statements, police interference during the trial and
    728
    police withholding of evidence? Is he personally satisfied that all those fears are groundless and unfounded? Will he give the House that assurance?
    The Attorney-General: All such questions are not for me but for my right hon. Friend the Home Secretary.

    Director of Public Prosecutions
    Mr. Skinner: To ask the Attorney-General when he next expects to meet the Director of Public Prosecutions about fraud; and if he will make a statement.
    The Attorney-General: Tomorrow. No.
    Mr. Skinner: When the right hon. and learned Gentleman finally meets the Director of Public Prosecutions—[HON. MEMBERS: "Tomorrow."]—yes, tomorrow, does he expect to discuss the scandal at NatWest, County NatWest, Phillips and Drew and the way in which the crooks in Tory-dominated firms are getting away with blue murder? Will he tell the DPP that it is no excuse for business men, often earning more than £100,000 a year, to say, "We do not understand the niceties of the law"? Will he also tell the DPP that he should act extremely quickly because those well-paid men may follow the example of Cameron-Webb and Dixon of the PCW syndicate, fly the coop and end up in America? Under this Tory Government is there not one law for the directors who support the Tory party and another for the old lady who has a tin of pilchards out of Marks and Spencer?
    The Attorney-General: The County NatWest papers have been referred not to the DPP but to the director of the serious fraud office because he is the appropriate official to consider them. That is all that it is proper for me to say at this stage, other than to suggest that it does not assist the course of justice to shout, or even to say quietly, the sort of remarks that the hon. Gentleman made. Such matters must be dealt with in a sensible, ordered and balanced way, because that is the way that justice is done in this country.
    Sir John Stokes: Is my right hon. and learned Friend aware that most right and hon. Members appreciate his comments? However, ordinary people look to him and others to ensure that where fraud is found in an organisation, those at the top do not escape the penalty.
    The Attorney-General: Fraud is an extremely serious criminal offence, wherever it is found. That is why a great deal of trouble is taken to investigate proper allegations, to establish whether criminal proceedings are justified, and to ensure that prosecutions are properly prepared before they begin. I agree very much with my hon. Friend's comments, and I am grateful to him for them.
    Mr. Fraser: Despite the Attorney-General's dismissal of the remarks of my hon. Friend the Member for Bolsover (Mr. Skinner), is not the right hon. and learned Gentleman concerned that the Tory enterprise culture seems to have spawned a few mulit-million pound viruses in the City? The real problem is that such incidents are not occurring at the fringes of the City but at its very centre. Will the Attorney-General confirm that decisions about investigations and prosecutions are consistent and made without partiality or prejudice as to the rank, title, seniority or antecedents of the individuals concerned?
    The Attorney-General: Certainly they will be. Whether it is congenial to the hon. Member for Bolsover (Mr. Skinner) that such decisions will be taken without concern to rank, title, status or anything else, I rather doubt. Of course it is right that all prosecution decisions are taken by reference to the Attorney-General's guidelines, laid down by my predecessor and now incorporated in the code for Crown prosecutors, a copy of which is in the Library, under the statutory authority of the Prosecution of Offences Act 1985. It is extremely important that such matters are examined absolutely impartially and fairly, and without regard to extraneous considerations.
    Mr. Dykes: I appreciate that my right hon. and learned Friend cannot say much about County NatWest because a report has gone to the serious fraud office. While dissociating myself from the hysterical remarks of the hon. Member for Bolsover (Mr. Skinner), further to the question of my hon. Friend the Member for Halesowen and Stourbridge (Sir J. Stokes), does my right hon. and learned Friend agree that there is widespread consternation about the report's suggestions and allegations of bad handling and of dishonest behaviour in the City? There may be suggestions that that behaviour is tantamount to fraud or is fraud, and does my right hon. and learned Friend appreciate that it would not be enough for the House, and that it would be outraged, if just a small number of lower level executives were to be the scapegoats for what happened and there were no resignations at the higher level?
    The Attorney-General: I repeat, misconduct of any kind connected with a breach of trust, and particularly in respect of the affairs of the City of London, is very serious. Whether or not it amounts to fraud is a matter for the director of the serious fraud office to consider in due course. However, no one who has paid attention to the comments of my noble Friend Lord Young of Graffham when he was Secretary of State for Trade and Industry can be under the slightest illusion as to the high degree of gravity that he and the Government he represented attach to such misconduct. The matter was referred by the then Secretary of State for Trade and Industry to two inspectors, and a very thorough report was prepared and published, which has been sent to the director of the serious fraud office. The gravity that right hon. and hon. Members in all parts of the House attach to the matter is entirely understandable, but the proper authorities must be allowed to do their job.

    Advice to Ministers
    Mr. Dalyell: To ask the Attorney-General what steps he takes to ensure the secure storage of documents relating to his legal advice to Ministers.
    The Attorney-General: My Department follows established procedures.
    Mr. Dalyell: On the subject of misconduct, may I ask, in a quiet and sensible way, whether Mr. Ingham did not get hold of legal advice and approve its quite improper disclosure in relation to the Solicitor-General's own letter on Westlands? Also on the question of misconduct, was not Sir Michael Havers so angry when he returned from his sick bed that he threatened to have Scotland Yard at the door of No. 10 Downing street if an inquiry was not set up? Equally, on the question of misconduct—gross
    730
    misconduct—did not the Prime Minister, when cornered and in difficulty—she is now forming another Cabinet—resort, at column 657 of the Official Report for 27 January 1986, to telling Parliament, in order to get out of her difficulty, a self-preserving and self-seeking lie?
    Mr. Speaker: Order. The hon. Gentleman knows far better than that. Will he please withdraw that last comment?
    Mr. Dalyell: You see, Mr. Speaker—
    Mr. Speaker: Order. Will the hon. Gentleman please withdraw that comment?
    Mr. Dalyell: No—
    Mr. Speaker: Order. I would be deeply reluctant to have to take action on this. Will the hon. Gentleman withdraw that final remark?
    Mr. Skinner: He said it last week and nobody pulled him up.
    Mr. Speaker: Order. I am dealing with this. Will the hon. Gentleman withdraw that comment?
    Mr. Dalyell: Who does a greater injury to Parliament, a Prime Minister who lies—
    Mr. Speaker: Order. I am not concerned with that matter. The hon. Gentleman must now obey my request or take the consequences.
    Mr. Dalyell: We have to be quite clear—
    Mr. Speaker: Order. The hon. Gentleman is putting in jeopardy the questions of other Members of Parliament. I will give him one more chance. Will he withdraw that comment, please?
    Mr. Dalyell: This is too serious a matter. It is dragging on and on. As you know, Mr. Speaker I have been to see you about this issue. It is a serious matter. Our questions have been pushed aside. Question after question has not been answered. What does the House expect—
    Mr. Speaker: Order. I have already said this and I am deeply reluctant to say it again. Is the hon. Gentleman refusing to withdraw that word?
    Mr. Dalyell: If I had wanted to withdraw it I would not have said it. It is the truth.
    Mr. Speaker: I name Mr. Tam Dalyell.
    The Attorney-General: To my great personal regret, it falls to me to move,
    That Mr. Tam Dalyell be suspended from the service of the House.
    Question put forthwith, pursuant to Standing Order No. 43 (Order in debate):—
    The House proceeded to a division—
    Mr. Ian Taylor (seated and covered): On a point of order, Mr. Speaker. Is it in order that we are about to lose Overseas Development questions, particularly those on Brazilian rain forests which were tabled by several Conservative Members, because of the disgraceful behaviour of Labour Members?
    Mr. Speaker: It is not a question of order; it is a question of fact.
    The House having divided: Ayes 188, Noes 28.

    Division No. 315]

    [3.21 pm

    AYES

    Adams, Allen (Paisley N)

    Garel-Jones, Tristan

    Adley, Robert

    Glyn, Dr Alan

    Alison, Rt Hon Michael

    Golding, Mrs Llin

    Allason, Rupert

    Gorst, John

    Anderson, Donald

    Gow, Ian

    Arbuthnot, James

    Grant, Sir Anthony (CambsSW)

    Arnold, Jacques (Gravesham)

    Greenway, Harry (Ealing N)

    Ashby, David

    Gregory, Conal

    Atkinson, David

    Ground, Patrick

    Batiste, Spencer

    Gummer, Rt Hon John Selwyn

    Beaumont-Dark, Anthony

    Hamilton, Neil (Tatton)

    Beith, A. J.

    Hanley, Jeremy

    Bennett, Nicholas (Pembroke)

    Hannam, John

    Blaker, Rt Hon Sir Peter

    Haselhurst, Alan

    Bonsor, Sir Nicholas

    Heathcoat-Amory, David

    Boscawen, Hon Robert

    Heddle, John

    Boswell, Tim

    Hicks, Robert (Cornwall SE)

    Bottomley, Peter

    Higgins, Rt Hon Terence L.

    Bowden, Gerald (Dulwich)

    Hill, James

    Bowis, John

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

    Boyson, Rt Hon Dr Sir Rhodes

    Howarth, G. (Cannock & B'wd)

    Brandon-Bravo, Martin

    Hughes, Roy (Newport E)

    Brazier, Julian

    Hunt, David (Wirral W)

    Bruce, Malcolm (Gordon)

    Hunt, Sir John (Ravensbourne)

    Buchanan-Smith, Rt Hon Alick

    Hunter, Andrew

    Buck, Sir Antony

    Hurd, Rt Hon Douglas

    Butler, Chris

    Ingram, Adam

    Butterfill, John

    Irvine, Michael

    Campbell, Menzies (Fife NE)

    Jack, Michael

    Carrington, Matthew

    Janman, Tim

    Cartwright, John

    Jessel, Toby

    Cash, William

    Jones, Robert B (Herts W)

    Chapman, Sydney

    Jopling, Rt Hon Michael

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

    Kellett-Bowman, Dame Elaine

    Conway, Derek

    Kennedy, Charles

    Coombs, Anthony (Wyre F'rest)

    Key, Robert

    Coombs, Simon (Swindon)

    King, Roger (B'ham N'thfield)

    Cormack, Patrick

    Kinnock, Rt Hon Neil

    Cran, James

    Kirkhope, Timothy

    Currie, Mrs Edwina

    Kirkwood, Archy

    Curry, David

    Knapman, Roger

    Davis, David (Boothferry)

    Knight, Dame Jill (Edgbaston)

    Day, Stephen

    Lang, Ian

    Devlin, Tim

    Latham, Michael

    Dickens, Geoffrey

    Lawrence, Ivan

    Dorrell, Stephen

    Lennox-Boyd, Hon Mark

    Douglas-Hamilton, Lord James

    Lightbown, David

    Dover, Den

    Lloyd, Sir Ian (Havant)

    Dunwoody, Hon Mrs Gwyneth

    Lloyd, Peter (Fareham)

    Durant, Tony

    Lord, Michael

    Dykes, Hugh

    Lyell, Sir Nicholas

    Eggar, Tim

    McCrindle, Robert

    Fallon, Michael

    McKay, Allen (Barnsley West)

    Fenner, Dame Peggy

    Maclean, David

    Finsberg, Sir Geoffrey

    Maclennan, Robert

    Forman, Nigel

    McLoughlin, Patrick

    Forth, Eric

    McNair-Wilson, Sir Patrick

    Foster, Derek

    Malins, Humfrey

    Fox, Sir Marcus

    Maples, John

    Gardiner, George

    Marlow, Tony

    732

    Marshall, John (Hendon S)

    Speed, Keith

    Marshall, Michael (Arundel)

    Speller, Tony

    Martin, David (Portsmouth S)

    Spicer, Sir Jim (Dorset W)

    Mates, Michael

    Spicer, Michael (S Worcs)

    Maude, Hon Francis

    Stanbrook, Ivor

    Mawhinney, Dr Brian

    Stanley, Rt Hon Sir John

    Mayhew, Rt Hon Sir Patrick

    Steel, Rt Hon David

    Mitchell, Andrew (Gedling)

    Stern, Michael

    Molyneaux, Rt Hon James

    Stewart, Allan (Eastwood)

    Monro, Sir Hector

    Stokes, Sir John

    Morrison, Sir Charles

    Sumberg, David

    Morrison, Rt Hon P (Chester)

    Tapsell, Sir Peter

    Mudd, David

    Taylor, Ian (Esher)

    Newton, Rt Hon Tony

    Thorne, Neil

    Nicholson, Emma (Devon West)

    Thurnham, Peter

    Onslow, Rt Hon Cranley

    Tracey, Richard

    Owen, Rt Hon Dr David

    Tredinnick, David

    Page, Richard

    Trotter, Neville

    Parkinson, Rt Hon Cecil

    Twinn, Dr Ian

    Patnick, Irvine

    Waddington, Rt Hon David

    Patten, Rt Hon Chris (Bath)

    Wakeham, Rt Hon John

    Portillo, Michael

    Walker, Bill (T'side North)

    Powell, William (Corby)

    Ward, John

    Raffan, Keith

    Wells, Bowen

    Renton, Tim

    Wheeler, John

    Rhodes James, Robert

    Whitney, Ray

    Riddick, Graham

    Widdecombe, Ann

    Rowe, Andrew

    Wiggin, Jerry

    Sackville, Hon Tom

    Williams, Rt Hon Alan

    Scott, Rt Hon Nicholas

    Wood, Timothy

    Shaw, Sir Michael (Scarb')

    Yeo, Tim

    Shelton, Sir William

    Young, Sir George (Acton)

    Shephard, Mrs G. (Norfolk SW)

    Shersby, Michael

    Tellers for the Ayes:

    Skeet, Sir Trevor

    Mr. Kenneth Carlisle and Mr. John M. Taylor.

    Smith, Tim (Beaconsfield)

    NOES

    Benn, Rt Hon Tony

    McAllion, John

    Callaghan, Jim

    McCartney, Ian

    Canavan, Dennis

    McKelvey, William

    Clwyd, Mrs Ann

    Madden, Max

    Cohen, Harry

    Mahon, Mrs Alice

    Cox, Tom

    Patchett, Terry

    Dalyell, Tam

    Redmond, Martin

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

    Salmond, Alex

    Eadie, Alexander

    Sedgemore, Brian

    Ewing, Mrs Margaret (Moray)

    Vaz, Keith

    Flannery, Martin

    Williams, Alan W. (Carm'then)

    Galloway, George

    Winnick, David

    Hardy, Peter

    Heffer, Eric S.

    Tellers for the Noes:

    Litherland, Robert

    Mr. Dennis Skinner and Mr. Harry Barnes.

    Livingstone, Ken

    Question accordingly agreed to.
    Ordered,
    That Mr. Tam Dalyell be suspended from the service of the House.
    Mr. Heffer: On a point of order, Mr. Speaker.
    Mr. Speaker: Order. After the statement.

War Crimes
3.32 pm
The Secretary of State for the Home Department (Mr. Douglas Hurd): With permission, Mr. Speaker, I should like to make a statement about the report of the war crimes inquiry.
I set up the inquiry in February 1988 to consider allegations that persons who are now British citizens or resident in the United Kingdom committed war crimes during the second world war and to advise whether the law of the United Kingdom should be amended to enable prosecutions for war crimes to take place in this country.
The report as submitted to me was in two parts. The main report contains the inquiry team's analysis and conclusions. The second part contains detailed material on individual cases. The inquiry team intended that the main report should be published. I am today publishing it in full and without amendment. I also accept the expert view of the inquiry team that publishing the material in the second part about individual cases would risk prejudicing any proceedings which might be instituted. I am sure that the House will see the wisdom of that distinction and understand why I cannot comment on individual cases.
I believe that the House will find the main report a full and impressive document. It takes a broad view of the historical context affecting the territories and peoples of eastern Europe, of the conduct of successive British Governments during and after the last war and of the legal and other issues. The team visited the Soviet Union and interviewed a large number of possible witnesses. I am most grateful to Sir Thomas Hetherington, formerly Director of Public Prosecutions, and Mr. William Chalmers, formerly Crown Agent for Scotland, for their authoritative analysis.
The inquiry deals with allegations of horrific killings on a large scale—crimes which would constitute violations of the internationally agreed laws and customs of war. The allegations are not about actions committed in the heat of war. They concern individuals allegedly holding quite senior positions in paramilitary units operating in territories occupied by the German forces, whose task was the systematic murder of civilians.
The inquiry examined in detail seven cases. It concluded in respect of four that there was sufficient evidence to mount a criminal prosecution. One of the individuals concerned has since died. The inquiry went on to recommend that further investigations should take place in respect of the other three cases. In addition, of the nearly 300 further cases drawn to the attention of the inquiry, it recommends further investigation of 75 and that attempts should be made to trace a further 46.
The inquiry recommends that there should be a change in the law to permit the prosecution in this country of acts of murder and manslaughter committed as war crimes in Germany or German-occupied territory during the period of the second world war, by persons who are now British citizens or who are resident in the United Kingdom. Certain procedural changes, including the taking of evidence by live television link from persons outside the United Kingdom, are proposed to facilitate the trial of such cases.
The members of the inquiry were aware of the danger of creating retrospective legislation and have tried to meet that objection. They are addressing actions which they are
734
satisfied constituted at the time clear breaches of international law, and which would constitute offences triable in British courts now, had the persons concerned been British citizens at that stage.
The inquiry reached its recommendation on legislation and prosecution in this country after examining and rejecting other courses of action. In particular, it discussed but did not recommend extradition of the individuals concerned to stand trial in the Soviet Union. It set out in the report the arguments for and against extradition. The Government find the arguments against extradition to the Soviet Union convincing.
The inquiry's recommendations raise important issues of principle and practicality. It can be argued that it is no service to the memory of the victims of these crimes to resurrect, after so many years, the horror of what they endured. One can question what will be achieved by prosecuting old men so long after the events. The practical difficulties of conducting trials include the age and frailty of witnesses, the problems of assembling the evidence, which is available in the Soviet Union, if at all, in a form in which it can be convincingly presented to a jury in Britain, and the problem of establishing identity and other key elements beyond reasonable doubt when witnesses' memories are more than 40 years old. The report deals with all those matters.
On the other hand it will be argued that, in the words of the report:
"The crimes committed are so monstrous that they cannot be condoned … To take no action would taint the United Kingdom with the slur of being a haven for war criminals."
Other countries that have uncovered similar evidence have acted to enable the alleged offenders to be brought to trial, sometimes making broader changes in the law than recommended in this report. Despite the practical problems of conducting a trial, the experienced inquiry team consisting of a former Director of Public Prosecutions and a former Crown Agent, reached the view that there would be sufficient evidence in three cases to mount a prosecution if there were jurisdiction. If and when the time comes for assessing the evidence, the prosecuting authorities of the day will need to make their own assessment of particular cases.
We are impressed by the force of argument that led the inquiry to its clear conclusion that legislation was required, but we want to hear the views of Parliament before taking a final view on the principle of legislation. This is a matter, after all, on which the views of Parliament will be decisive. The Government will provide an opportunity for each House to debate the implications of the report and the action that should be taken in response to it. The debates will take place in the autumn once there has been a proper opportunity to study the report and reflect upon it. In the light of the views expressed in those debates, the Government will take a final decision on whether to bring forward a Bill on the lines proposed by the inquiry.
Mr. Roy Hattersley: I offer the Home Secretary support for the general position that he has adopted following the inquiry into war crimes. Few will doubt that the crimes considered in the report are too appalling to be passed over, even after half a century has elapsed. The inquiry was right, however, to identify some formidable problems of principle and practice that would

735
be involved in prosecutions. We therefore welcome the Government's decision to arrange a debate in the House before reaching any definite conclusion on how to proceed.
If there are war criminals in Britain, and if they are brought to trial, it is essential that action against them should be taken by acceptable legal means. I therefore welcome the Government's decision that, if there are to be prosecutions, those prosecutions must take place in Britain. It would be quite wrong to deport, or allow the deportation of, suspected persons to countries where, as the report put it:
"The system of justice is not comparable to that in this country".
The decision to try such people here would require substantial changes in British law. I hope that the Home Secretary will confirm, in terms, that it would require restrospective extension of jurisdiction to persons who are not at present liable to charge or trial.
With that in mind, let me ask the Home Secretary three specific questions. First, if changes in the law were necessary—for example, the introduction of video recordings as evidence in Scotland—would the Government consider changing the law in general and applying the changes to all criminal proceedings, or would they consider simply changing the rules of evidence as they apply to war crimes? There is clearly a great danger in having one rule of evidence for one crime and different rules of evidence for all others.
Secondly, has the Home Secretary considered the full implications of relying on evidence in statements by individuals who are now dead? Few people would be happy were that practice to be extended to legal proceedings in general and, again, there is great danger in applying the principle to one category of charges and trials but not to others.
Thirdly, the Home Secretary will know that some of the individuals who may be prosecuted under the legislation that he is considering have already been named in newspapers. As they are not covered by the sub judice rule, does the Home Secretary propose to take steps to protect them from more prejudicial publicity?
Finally, let me ask the Home Secretary to consider one issue of principle—even before the House debates the subject. Does he agree that there are great problems of principle and practice in introducing legislation to facilitate the prosecution of a very limited number of individuals, who are probably identifiable?
Would it not be better to introduce general legislation—perhaps in terms of the Geneva convention of 1949—to make possible the prosecution of criminals from any war who have taken refuge in Great Britain or acquired British nationality? I understand that that is the approach which has been favoured by other countries that have faced the same problem. To many of us, that seems right—to avoid making retrospective changes in the law to deal with known individuals and to ensure that Britain does not harbour criminals from any war taking place at any time in any part of the world.
Mr. Hurd: I am grateful to the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) for his general approach. This is a matter on which there will be strong differences of view that will certainly cut across party lines and on which Parliament as a whole will have to take a view.
736
I confirm the right hon. Gentleman's understanding that the proposal in the inquiry report would not make anything criminal which is not now criminal. Instead, it would bring within the jurisdiction of our courts certain allegations of crimes which are not at the moment within their jurisdiction because those concerned did not live here at the time of the crime although they now live here and in some cases are British citizens. That is the scope of the change.
I accept the general principle that the right hon. Member suggested about not providing special procedures for the particular crimes described in the report. He will know that under section 32 of the Criminal Justice Act 1988 we provided for evidence to be taken by video links in England and Wales. It does not apply in Scotland, which is why the report suggests that it will have to be dealt with. It has not yet been implemented in England and Wales, and we shall have to discuss its implications more thoroughly. The principle is provided in the law for England and Wales.
The right hon. Member rightly said that there has been comment on individual cases in the past. Neither I nor anyone else can prevent such comment in the future. It is worth saying that, even if Parliament decides to amend the law, as the inquiry suggested, three consequent stages will bear on a fair trial. First, the prosecuting authorities will have to decide, by their usual criteria, whether there is scope for a successful prosecution, Secondly, the judge will have to decide the conduct of the trial to ensure that it is fair—the Criminal Justice Act is clear about that. Thirdly, the jury will have to decide whether the trial has been fair.
The right hon. Member mentioned the scope for wider legislation. Other countries have gone wider, but to go wider than the Hetherington inquiry would land us in a range of further problems. I shall study what the right hon. Gentleman said.
Mr. Ivan Lawrence: Is my right hon. Friend aware that the recommendations of this distinguished inquiry will meet wide support throughout the country, because they will mean that Britain will no longer be a safe haven for the monsters who committed the worst atrocities? Although any decision to legislate will undoubtely be strengthened by an opportunity for quiet consideration of this emotive subject, one of the recommendations of the inquiry is that legislation should be introduced as quickly as possible, bearing in mind the ages of suspects and witnesses. Will my right hon. Friend bear in mind that although the inquiry was limited to consideration of the second world war, it will be necessary to have such legislation in place to deal with atrocities committed in wars since the second world war?
Mr. Hurd: On the second point, the scope of the recommendations is more limited. If we legislate, that is exactly the sort of point that the House will want to consider.
I note what my hon. and learned Friend says about speed, but I find this such a difficult subject, and all those who have thought about it will share my views. The arguments of principle and practice pile up on either side, and it is not easy to reach a conclusion. I am sure that it is right that we should all consider the report carefully, pause and listen to views, which the Government certainly intend to do before bringing proposals before the House.
Mr. Robert Maclennan: Will the Home Secretary accept that Social and Liberal Democratic party Members welcome the measured depth of the analysis of these two distinguished gentlemen? The Home Secretary has taken appropriate action in allowing Parliament to voice its view before he takes a final decision, although perhaps it is fair to say that his statement leans towards accepting the recommendations.
Does he accept that the important finding of the report is that the crimes concerned were not only monstrous but were against international law at the time that they were committed? The limitation of the recommendation to extend the jurisdiction of our courts to deal with these matters is important because it enables us in Britain to give greater effect to the rules of international law for the purposes for which the Nuremberg trials were set up.
Finally, may I add my support to the submission made by the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) that in considering legislation it would be appropriate to contemplate wider legislation to seek to bring within the scope of our jurisdiction war criminals who have committed crimes in other situations and at other times, perhaps those covered, as the right hon. Gentleman suggested, by the Geneva convention?
Mr. Hurd: When the hon. Gentleman studies the report, he will see why the inquiry came down in favour of a narrow extension of the law. It was anxious to avoid the accusation of retrospection and, therefore, to confine the scope of any change in the law to allegations of crimes which clearly and beyond any doubt were crimes and were criminal at the time they were committed, and not as a result of any international instruments that may have been entered into since 1945. I am grateful to the hon. Gentleman for his general response.
Mr. Ivor Stanbrook: Is my right hon. Friend aware that it would be a tragic mistake now to institute war crimes trials in this country and to stir up the emotions of hatred and revenge which would be evoked by the stories of these wartime atrocities? How would it be possible for those few men to get a fair trial when a law would be passed specially to frame them, when the evidence would be almost 50 years old and when it would be impossible for them to go to the Soviet Union to find witnesses and evidence that might clear them?
Mr. Hurd: My hon. Friend puts a point of view which will certainly be widely shared. However, the emotions that he has talked about are, of course, stirred up by the allegations and would certainly not be put to sleep by an announcement that the Government were going to do nothing. That would not necessarily have the effect that my hon. Friend mentioned. We in this country do not have a statute of limitations. Other countries, such as Sweden and Belgium, do, and it affects their handling of these matters. However, like Australia, Canada and the United States, we do not have statutes of limitations and, therefore, although there is force in my hon. Friend's practical point, it is not a point of principle for our law.
Mr. Merlyn Rees: Is the Home Secretary aware that, as chairman of the all-party group on war crimes, I agree with his description of the report as impressive? It contains within its covers a statement about the international law and about what has happened in other countries. Indeed, the impressive nature
738
of the report is what one would have expected from Sir Tom Hetherington and Mr. Chalmers. In the writings that preceded the report, far too many people have ignored one fact, which is brought out in paragraph 9.50, which states:
"The cases we have investigated disclose horrific instances of mass-murders".
I emphasise that the Hetherington report has been investigating mass murders, not any of the other horrible things that happen in wars on either side. I should like to make it clear to those from the Ukraine, from Latvia and from middle Europe that most of those people who have come into this country have become first-rate citizens, and many of us know them, especially in the cities of the north. The people that we are concerned about are those who have been involved in horrific instances of mass murders, and those who choose to forget that will be asking for equally horrific things to happen in the future.
Will the Home Secretary confirm that the recommended change in the law is approximately this: that if I, as a British citizen, had committed these crimes in any part of the world, I could be brought to trial; so those who acquire British citizenship subsequently are not being treated in any other way than in the way in which British citizens by birth are being treated, and that is the way that it should be?
Mr Hurd: The right hon. Gentleman's first and last points are correct. The report brings out clearly the turmoil in central and eastern Europe immediately after the war and the way in which people came here for all kinds of reasons and through all kinds of procedures. There was confusion and a lack of clear thinking and administration. As a result of that, many thousands of people of east European origin have been living here for a long time as admirable and loyal citizens. The right hon. Gentleman was right in pointing out that we have all come to know and respect their communities. As the right hon. Gentleman said, and as I tried to say in my statement, we are not talking about actions committed by soldiers in the heat of battle. That is a different proposition. We are talking about allegations—they are only allegations—that crimes of mass slaughter were presided over and participated in by a number of people now living in this country.
Mr. John Gorst: Does my right hon. Friend agree that to deter such crimes in the future, it is first necessary to ensure that those who commit those evil deeds will be certain that they will have to face justice and that, therefore, there is a gap in our existing law? May I ask my right hon. Friend one detailed question? If Parliament affirms what my right hon. Friend will be putting to it in the autumn, will it be necessary for the British police to carry out investigations, which they cannot at the moment carry out or believe that it will be necessary to carry out in future?
Mr. Hurd: Yes, Sir, certainly, and the report makes that clear. It recommends a series of investigations, but I am not prepared to authorise further work on them until it is clear in what way Parliament will wish to proceed.
Mr. James Molyneaux: The Home Secretary used the phrases "within the United Kingdom" and "a Bill". If the Government decide, with Parliament's approval, to introduce legislation, will they seek to proceed by way of a single Bill applying simultaneously to all parts of the United Kingdom?
Mr. Hurd: Yes, Sir, I believe that that would be the right way to proceed if—it is an "if"—it were decided to seek legislation.
Mr. John Wheeler: Does my right hon. Friend agree that there will be widespread admiration for the thoroughness of the excellent report, which requires careful consideration? Does he also agree that the horrific nature of the allegations contained in the report make it not a matter for just British Jewry alone, but that the wider issues of justice and principle must also apply?
Mr. Hurd: I very much echo the hope that hon. Members and. indeed, the public will read the report. I know people who have approached the subject with one attitude but who, having read the report, have come to a different one. My hon. Friend is right to make his distinction. It would not be for the House or for Parliament to decide whether individuals were guilty or even whether they should be prosecuted. Now that the report is before us, Parliament is involved with a question of principle—whether there should be legislation to bring such allegations within our jurisdiction. If Parliament so decided, it would be for the prosecuting authorities in different parts of the United Kingdom, under their existing criteria, to decide whether prosecutions should be mounted. If they were mounted, it would be for the judge in each case to decide whether the trial was best conducted under this or that procedure authorised by Parliament, and at the end of the day it would be for the jury.
Mr. Peter Archer: While in no way dissenting from the right hon. Gentleman's proposal for a debate, has it occurred to him that those who hear nemesis approaching may decide to disappear for a second time? If there is a delay in legislating, the Odessa file may be out again. Has he any proposals for dealing with that and, if not, is time not of the essence?
Mr. Hurd: I have no proposals for dealing with that. It would he unacceptable to take powers to constrain the movements or actions of people who are involved in the situation that we are now discussing. I cannot see any basis on which one could do that. The right hon. and learned Gentleman's point is an argument about time, but I do not believe that he would press us to rush into legislation in the fag end or the spillover of this Session. That would not be a sensible way in which to approach such a matter.
Mr. Robert Boscawen: I think that many people will be grateful that my right hon. Friend the Home Secretary has agreed that Parliament should make the decision on whether legislation should go ahead. My right hon. Friend has already answered my question when he said that Parliament would have no further say on whether there would be prosecutions following that legislation and that, naturally, that would be within the hands of the prosecuting authorities. The decision to go ahead with legislation could mean that such war crime trials could take place. After 45 years we in this country should not feel that it is necessary to prove that we are not a safe haven for war criminals. We never have been and we do not need crimes tried after 45 years to prove that.
Mr. Hurd: I understand my hon. Friend's point of view. I hope that he will read what is said in the report about the
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people, the crimes and the documents and statements that have been produced as part of the investigation by Sir Thomas Hetherington and Mr. Chalmers.
Mr. Jeff Rooker: Does the Home Secretary accept that war crimes are not committed by the losing side only, but that the specific and horrific nature of the crimes in this case—no one denies that those crimes were committed—is what makes them different from all other war crimes? Therefore, I do not believe that we should feel apologetic at all in seeking to consider bringing forward legislation. It behoves the combative powers of the second world war, 45 years after its end, to make a common decision and to say, "We will proceed no further at any time with any allegations regarding war crimes" or, "Collectively, we shall amend and adjust our legislation to pursue until the end of time those who have committed those atrocious crimes." I subscribe to the latter view, but one way or the other, a decision of principle should be made.
Mr. Hurd: The report gives a fascinating account of the efforts to reach precisely that decision of principle immediately after the war and how those efforts foundered. Different countries have gone different ways. The United States, for example, deports and extradites—it has extradited to the Soviet Union and I believe that the person extradited was executed. In our terms I do not believe that that is a satisfactory way in which to proceed. Other countries have statutes of limitations and other countries have held trials. Canada and Australia, which faced a very similar situation to ourselves, have passed legislation that goes rather wider than that proposed in the inquiry. Although I see the advantage in what the hon. Member for Birmingham, Perry Barr (Mr. Rooker) has suggested, I am afraid that it is past praying for. We shall not get a co-ordinated and harmonious approach to this matter. We must deal with it as the report deals with it, within the law and within the practice of each country.
Mr. Ian Gow: Despite the horrific nature and the horrific scale of the allegations will my right hon. Friend remember Churchill's precept: there is no greater danger than retributive persecution, and a policy of retribution is a policy which is pernicious?
Mr. Hurd: It was actually Sir Winston Churchill who, during the war, set in hand the principle that there should be retribution. The report clearly shows how that statement by the Prime Minister set the tone for a great deal that followed. The fact that someone like Sir Winston Churchill had great difficulty, as time passed, in deciding within himself what the right approach should be, illustrates something that anybody thinking about this comes to appreciate—that it is extraordinarily difficult and that the passage of time obviously makes it more difficult in terms of principle, but particularly in terms of practice. I believe that the only recipe—I will not give this advice again—is for right hon. and hon. Members to digest the report and to come back in the autumn and form views upon it.
Mr. Greville Janner: Will the right hon. Gentleman convey to the distinguished and learned commissioners the appreciation of the House of the way in which they carried out their difficult task? Will he especially convey the appreciation of those of every nationality, race and religion who suffered and whose

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families suffered as a result of the mass murders and barbaric Nazi outrages to which this report refers? Will he also have regard to the final paragraph of the report—that
"Given the ages of the suspects and witnesses"
the commissioners considered
"that any proposed legislation should be introduced and brought into force as quickly as possible"?
May we hope that the debate on this matter will be at the end of this Session, although, of course, legislation could be introduced only at the beginning of the next?
Mr. Hurd: I note what the hon. and learned Gentleman says. I think that I covered most of his points in my earlier replies. I would certainly hope that the debates will not be long delayed; I mentioned the autumn, which gives the business managers a certain flexibility.
Mr. Rupert Allason: Does my right hon. Friend agree that the report highlights an anomaly in the law—that under present legislation this country does, indeed, provide a safe haven for war criminals, an unpleasant fact which is true of only one other country, Syria? Once legislation is contemplated by the House, will my right hon. Friend seriously consider setting up a specialist police unit to investigate the allegations made not only against the 75 people who have been identified but against the 46 who have yet to be traced?
Mr. Hurd: Certainly, if the House decided to proceed down this path there would need to be further investigations. The matter could not be left on the basis of the cases that the inquiry had the time and resources to explore. That would be far too haphazard. If Parliament took a decision in principle there would be further investigations as a consequence and they would have to take place in the usual way. As I have said, I am not prepared to authorise such further investigations at the moment.
Mr. Harry Ewing: Am I right in assuming that the Government have still not made up their mind about the possibility of bringing forward legislation? Is the Home Secretary aware that this is a highly emotive issue which pulls people in all directions? For some time at the beginning of the statement I thought that I might be in a minority of one—until I heard some Conservative Members speak. I have just as much sympathy and feeling for the victims of these atrocious crimes, but, on the principle involved, what is to be achieved by putting on trial people of 80 years of age or more and, assuming that they are found guilty, sending them to prison for the rest of their natural lives? What on earth can be achieved by that sort of approach? Does the right hon. Gentleman accept that the world, north and south, east and west, is at the beginning of a healing process? If we open up all these old sores, how will we ever continue that process?
Mr. Hurd: The hon. Member puts it well; he will certainly not be alone. It would not be this House which put very old men on trial. The decision before the House is a different one, about whether, as a matter of principle, we should follow the example of Australia, Canada and the United States, which were faced with the understanding that there were people within their borders who might have committed these crimes, and which changed their laws to bring those crimes within their jurisdiction; or
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whether, again as a matter of principle, we should take the line that although we have no statute of limitations, the matter is too difficult and too long ago, and however horrific the crimes, we intend to forget them.
I hope that the hon. Gentleman will read the report in full. He will find his views recorded there and he will discover what the report has to say about them.
Sir John Stokes: Is my right hon. Friend aware that I remember only too well the war crimes trials held immediately after the last war, and that some, even then, had doubts about the procedure, although I agreed with it? Are we now to resume war crime trials of these few old men 40 years later? How can we ever obtain proof? Will not the trials be in danger of being show trials? Above all, do the people of England want this? We are not a vengeful nation and I have not heard any demand for it apart from the demand by this small and highly articulate lobby.
Mr. Hurd: My hon. Friend puts a view in which, as I have said, he will not be alone. He will read the report as others will, and he will see how it caters for the objections that he puts forward about the fairness of trials. Of course, the House will be concerned not with individual cases or trials but with the principle of the matter. It will be concerned with the quotation, which I have now found, from a speech by Mr. Churchill to which I referred in answer to my hon. Friend the Member for Eastbourne (Mr. Gow). Mr. Churchill, the Prime Minister, said:
"Retribution for these crimes will henceforward take its place among the major purposes of this war."
Mr. David Winnick: There are valid arguments on both sides about whether prosecutions should occur and many reasons have been voiced by hon. Members. Is it not more a question of justice and certainly not revenge? Will not many people ask how it was possible for people who have been held responsible for monstrous crimes against humanity to enter the country in the first place? Is it not correct to say that if it had been the determination of the allies to carry out in practice what Sir Winston Churchill, together with other wartime leaders, promised to do from 1941 onwards, and if Nazi war crimes had been properly investigated after the war and certainly after Nuremberg, but before the cold war started, it is likely that some of the difficulties and agonising problems that we are discussing about whether such people should be brought to justice would never have arisen in the first place?
Mr. Hurd: The hon. Gentleman can hark back like that if he wishes, but I am not sure that it is profitable. The first chapters of the report deal with the history in some detail. Great numbers of people came here in the turmoil that followed the war. Some of them were deliberately recruited by the Government for particular jobs, some were here as prisoners of war and, for example, many Poles came because of their connections with the Polish armed forces. The matter has a long and tangled history. There was a good deal of screening. No one could argue that it was particularly clear minded or administratively thorough and no one with a sense of history would expect that it could be. I do not think that the hon. Gentleman would do anyone a great deal of good by spending too much time on history.
Mr. David Sumberg: Will my right hon. Friend accept my congratulations on a sensitive statement on matters which show crimes beyond parallel in the long catalogue of human misery? Will he underline that, as the law stands, it would be possible to prosecute a natural-born British citizen over such matters and that what he now proposes is to put those who acquired British citizenship after birth in the same position as those who acquired it on birth? I accept that there is a need for the House to debate the matter widely and thoroughly. Does he accept that there is a need to get on with it?
Mr. Hurd: My hon. Friend accurately describes a proposal which is not mine but that of the inquiry. The Government make no proposal today. We are impressed by the force of the arguments and the background set out by the inquiry, but propose to pause and listen in the way that I have described.
Mr. Paul Flynn: Does the Home Secretary appreciate that although a Bill may deal only with war crimes, Nazi crimes started many years before the commencement of the war? Does he also appreciate that since the war unfortunately, many other acts of mass murder have been committed in both the East and the West? Would not the Bill be a marvellous opportunity for this country to reassert its leadership of the world on humanitarian issues? We can do that if we sent out a clear signal to all those whose business is mass murder and torture, whether in the distant past, the recent past or now, that never again will they find safe refuge in our country.
Mr. Hurd: That goes very much wider and I think that on examination the hon. Gentleman will find that there might be quite serious problems in terms of retrospection if we went back that far and covered the kind of pre-war offences that he talked about. I hope that he will look at the report. He is obviously in sympathy with its general conclusion and would like it to do more. The report spends a certain amount of time discussing why it thinks that its limited recommendation is right.
Several Hon. Members rose—
Mr. Speaker: Order. The House knows that there is to be a debate on this matter later, but, as hon. Members have been rising, I will call them. However, we must move on at 20 past four because we have another statement.
Mr. Tony Marlow: Will my right hon. Friend agree with Milton Shulman, who says in today's Evening Standard that no emotion
"soils the human spirit more than vengeance"?
Is it not possible, despite what my hon. and learned Friend the Member for Burton (Mr. Lawrence) said, that the motivation behind this campaign has nothing to do with justice and everything to to with smothering the world with a form of moral blackmail as a means of covering the present behaviour of the state of Israel? The House has got the impression that my right hon. Friend is not happy with this measure, and has not found a respectable way of not bringing it forward.
Mr. Hurd: I honestly think that my hon. Friend's description is grotesquely astray in its attempt to describe Sir Thomas Hetherington and Mr. Chalmers, who have taken a great deal of trouble to take the allegations that have been made—for whatever reason—to analyse them and to look behind them into the facts of these crimes. It
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was because the Government wanted to get away from the kind of atmosphere that my hon. Friend attempts to describe—in which all kinds of allegations were being tossed to and fro, and nobody knew the motives or what substance there was behind the allegations—that we had this inquiry. I hope that my hon. Friend will read the results of it.
Mr. Spencer Batiste: Does my right hon. Friend agree that the important message that should come from the House is not one of revenge or of opening up old wounds, but the simple fact that those who have been guilty of horrendous crimes against humanity must never be able to feel that they are capable of achieving a safe haven in a civilised world? Would not that be the best message of hope that we could give to their potential victims?
Mr. Hurd: I am sure that my hon. Friend is right in that no serious person can be interested in revenge as the basis for justice. Nor could any serious person ignore the difficulties of proceeding as the inquiry suggests after this length of time. Those difficulties are real, and that is what makes the subject so daunting. Nevertheless, the analysis is a clear and strong one.
Mr. Nicholas Bennett: I share the considerable unease that has been expressed by some of my hon. Friends about whether, 45 years after the events, there can be a fair trial and fair rules of evidence, especially when we have to introduce retrospective legislation. Therefore, I welcome my right hon. Friend's statement that Parliament will make a judgment on this.
I have a more specific question concerning the documentary evidence. My right hon. Friend will be aware that most crimes took place in what is now either the Soviet Union or another eastern bloc country. Historians have recently expressed concern that many documents have been forged. Can we be assured that any documents that might be used for trials will be the originals and not photocopies?
Mr. Hurd: That was one of the points in which some of us were particularly interested before the inquiry was set up, and it was something on which the inquiry spent a good deal of time. It reached the conclusion set out in part 1, which is that there was a strong case for believing that the documents concerned were authentic and the witnesses credible.
Mr Toby Jessel: Is not the real point the sheer number of murders? We are not talking of one murder, nor six, nor 60, nor 600, nor 6,000, nor 60,000, nor 600,000 but 6 million murders, including the murder of about 1 million children. What is wrong with the idea of a little bit of justice for that?
Mr. Hurd: In essence, what we are talking about in this inquiry is the slaughter, after the fighting was over, of very large numbers of Jews, simply as a matter of policy. The policy was one of slaughter, and a large number of people participated in that.
Mr. John Marshall: Should not the fact that the evidence is regarded as sufficient to warrant a prosecution by Sir Thomas Hetherington silence the doubts of those who cast doubts on the quality of the evidence?
Mr. Hurd: I do not expect a report, however expert, to silence doubts on a matter such as this. I should be surprised, and in a way dismayed, if that were to happen. That is not the way that we run our affairs. There is bound to be controversy, and it is bound to cross the ordinary boundaries of party, as we have seen in these exchanges. It is a clear and forceful report, by people whose experience, coolness and caution in such matters it would be hard to rival.
Mr. Hattersley: I have no wish to take serious issue with the Home Secretary this afternoon. I think that we have more in common over this issue than over many, united by our mutual doubts. However, I ask him whether he will consider one answer which he gave, and consider the possibility that it was wrong in fact. He said that were we to proceed on the lines that are now possible we would not be proceeding against individuals. That would certainly be the case were we to amend the law in general as the Geneva convention of 1949 suggested, but were we to proceed as the report suggests, it would be specifically directed towards individuals. If the Home Secretary reads paragraphs 8. 24 onwards of the report under the heading "Tracing suspects", he will see that the report does everything but name the individuals against whom the action is proposed. It is that which concerns some of us. Therefore, will he think again about the more general provision which I have urged upon him?
Mr. Hurd: I have promised to think about the more general provision, but I would not agree with the right hon. Gentleman. Parliament would be asked to extend our jurisdiction over a series of offences—not specified and not specific as to individuals—committed outside the United Kingdom during the war, in Germany or German-occupied territories, by people who were not then British citizens but now are or who live here. That would be compatible with individual decisions by the prosecuting authorities to proceed or not to proceed in particular cases. That is what I mean by saying that Parliament would be involved in deciding the principle. It would then be for the prosecuting authorities, the judge and finally the jury, if there were a prosecution and a trial, to decide in particular cases. That is an important point.

Electricity Privatisation (Nuclear Power)
4.21 pm
The Secretary of State for Energy (Mr. Cecil Parkinson): With permission, Mr. Speaker, I should like to make a statement about electricity privatisation and nuclear power.
As a result of our preparations for privatisation, it has recently become clear that the cost of reprocessing and waste treatment of spent Magnox nuclear fuel will be a great deal higher than has been charged in electricity prices and provided for in the accounts of the Central Electricity Generating Board and the South of Scotland electricity board. The Magnox stations are drawing to the end of their lives. One is already closed, and most of the others are due to close within the next few years. Most of these costs therefore relate to the past, to electricity already generated and paid for. Future customers will be bearing the full cost of the electricity they consume. It would not be right to burden them also with costs arising from the past.
It is important that the energies of the companies should be directed towards ensuring that their existing stations are run efficiently and at lowest cost. National Power will, subject to planning and other consents, also be building new pressurised water reactors. In order to enable the nuclear generating companies to focus their attention on the future, the Government have decided that it would be appropriate to relieve the new companies of dealing with these substantial problems of the past.
The Government have considered carefully how best to implement this decision. It has been decided that both the assets and liabilities relating to the Magnox stations belonging to the CEGB and the SSEB should remain under Government control.
The advanced gas-cooled reactor stations will be assigned to National Power and the Scottish Nuclear Company, and will be privatised. These stations have many years of operation ahead. The operating performance of these stations has shown marked improvement, and this can be expected to continue in the future. Therefore, we have good reason to believe that the AGRs will have a long and successful future in the private sector. National Power will continue to construct Sizewell B and, subject to obtaining the necessary planning approvals and satisfactory contractual arrangements, intends to construct and operate three more PWRs.
No changes to the Electricity Bill are needed to bring the Government's decisions into effect. The Government shall be laying a draft order before Parliament during the autumn to increase the limit on the amounts payable under schedule 12 from the interim level of £1,000 million to £2,500 million.
This order will be subject to affirmative resolution and will give the House a full opportunity to debate our detailed proposals. The order will enable grants to be paid to National Power and to the Scottish Nuclear Company for unforeseen costs, as previously explained to the House. These powers will also be used to ensure that the Magnox stations can continue to be operated and their liabilities to be met.
I am most concerned to ensure that nothing is done to jeopardise the future of the employees concerned. Their pension rights, their ability to benefit from the flotations,

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and their career prospects will be protected. To this end I shall discuss the implementation of the proposal with all the parties concerned, including the trade unions.
We shall ensure that the necessary resources are available to maintain the present high standards of safety and environmental protection. We shall not take any steps that are not approved by the nuclear installations inspect orate.
Preparation for privatisation has brought new information to light. The costs for the Magnox stations, which have now become clearer, would present major financial problems for the two nuclear companies. They can be paid for only by the customer or the taxpayer. The Government do not believe that this legacy of the past should be borne by customers in the future. The Government have therefore moved rapidly to deal with the issue.
It is right to separate the problems of the past from the prospects for the future. The nuclear generators will be able to concentrate their efforts on building a new generation of PWR stations and further improving the performance of the AGRs. On the basis of the presently planned life, the last Magnox station will have closed by the year 2002. Thereafter, commercial nuclear power generation will be wholly in the private sector. That is where it should be, and where it will flourish.
Mr. Tony Blair: Well, Mr. Speaker—here we have it. After months in Committee, three days on Report, weeks in the other place and the Prime Minister's statement on 5 July, all the time told that the nuclear stations would all be sold, we are now informed, on the last day of the last stage of the last group of final amendments to the Bill, that the sale of the Magnox stations is to be ignominiously pulled—renationalised before they are even privatised. Are not the right hon. Gentleman's proposals for privatisation now a humiliating farce? If the lunchtime reports are correct and the right hon. Gentleman is departing to other pastures, this must be the most expensive exercise in political history of clearing one's desk.
Am I right in following through what this means—the Magnox stations will remain in public ownership so that the full costs of decommissioning, disposing and reprocessing of waste will fall on the taxpayer? Will the right hon. Gentleman confirm that the latest estimates show that those costs may be £500 million a station—a total of £4·5 billion or perhaps even more?
Is not the question, what has the taxpayer got in return for that deal? Am I not right in saying that, not only will the nuclear tax still remain to pay for the new stations, costing consumers billions of pounds, but the nuclear quota will remain, distorting the market and squeezing out competition? Worse, does not what has been announced today mean that the public sector liability for decommissioning those stations transferred to the private sector will not just remain in full, but will be increased two and a half times? Has there ever been a more disastrous deal for the British taxpayer?
The only explanation we are given is that the public have used the stations and thus should pay for them. If that was the criterion, what of the new stations and those with many years of life left in them in which the public have heavily invested and of which they are now to be deprived? If the Secretary of State says that the public sector must pay for the stations it has used, why should it
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not also use those for which it has paid? Is not the true motivation for this quite transparent—that the right hon. Gentleman will sacrifice anything, including normal commercial prudence, the interests of the taxpayer and the consumer and the future energy needs of this country, provided that, above all else, he can sell his privatisation to the City?
Does not one large obstacle remain, however? Has not the right hon. Gentleman always made it clear, most especially last March in front of the Select Committee on Energy, that the critical element in the entire structure of the privatisation, with its monopoly area boards, monopoly grid and duopoly of generators, was dictated by the worry about what he called the marketability of nuclear power in the Magnox stations? Has not the right hon. Gentleman now removed not merely a substantial part of the electricity industry's assets from the privatisation, but the entire justification for the form that the privatisation has taken? Would not the right course now be not to try shoring up that crumbling monument to incompetence, but to abandon it here, now and for good?
Mr. Parkinson: I congratulate the hon. Gentleman on a fine display of rhetoric, but I wish to point out one or two matters. He made it sound as though this were the first time that any Government had proposed that public money be written off. I remind him that £20 billion of taxpayers' money has been written off since the nationalisation of the coal industry, and that only earlier this afternoon his hon. Friends were urging me to write off billions more. Let there be no more of this nonsense about it being the first time that any Government have come forward with restructuring proposals.
I wish to make one point quite clear. The Magnoxes, virtually to a station, were commissioned and built during the lifetimes of Labour Governments. Far from causing the problem, privatisation has, for the first time, brought the costs into the open. We are making arrangements to deal with the problem, not creating the problem.
I confirm that the AGR and PWR stations, which will be transferred, will bear their own costs, will provide for their own decommissioning and will provide for their own waste management. The difference is that, in most cases, those stations have decades of life ahead of them, while the Magnoxes are all coming to the end of their useful lives.
As we explained in Committee, under schedule 12 to the Electricity Bill, the only money that will be paid to the privatised nuclear stations will be for unforeseeable costs arising from changes in Government policy. Other costs will have to be met by the customer, collected through prices and provided over the lifetime of the stations.
The Magnox stations were never the vital part of our privatisation plans; they are the past. We did not devise a structure around a set of power stations of which most will be closed by 1995 and only one, Wylfa, will be operational in the next century to the year 2002. Those stations were not a major part of our proposals and not part of the future. Today we are clearing up costs incurred in the past.
Mr. David Howell: Despite the fulminations of the hon. Member for Sedgefield (Mr. Blair), who clearly would like to keep everything under strict bureaucratic control, are not my right hon. Friend's proposals a sensible and realistic way of dealing with a legacy of the past, and in line with what some of us wanted from the outset? Does my right hon. Friend agree that, far

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from damaging the future of either the nuclear or the privatised industry, they clear the way for much better prospects for competitive nuclear power? Will he confirm that the fact that not only National Power but PowerGen may consider building a dedicated PWR nuclear power station is evidence that it is an increasingly competitive and promising area?
Mr. Parkinson: My right hon. Friend is right. We are talking about clearing up the costs of technology that was initially developed at the behest of Labour and Conservative Governments more than 30 years ago, which is a very expensive exercise. The future of the nuclear industry is in the hands of the PWRs, which operate successfully worldwide. There are very successful private sector operators of PWRs in France and Germany, and there is Duke Power of the United States of America. PWRs are a proven technology capable of producing electricity economically. My right hon. Friend is right to say that we are clearing up the past and opening the way to the future.
Mr. Malcolm Bruce: Will the Secretary of State admit that the reason why he came to the House with his statement is that his friends in the City told him that he cannot sell the Magnox sector? If omitting it from privatisation is such a good idea, why did he not incorporate it in the Electricity Bill, as others suggested at the outset?
The Secretary of State attempted to turn the attack from the hon. Member for Sedgefield (Mr. Blair), but does he not admit that the scale of the write-off of taxpayers' money associated with the flotation of the electricity industry exceeds the worst excesses of Socialism that the right hon. Gentleman is so keen to fulminate against? The sum is £8 billion to date, and there is an open blank cheque from the consumer for the decommissioning of Magnox power stations.
Will the Secretary of State admit that his statement vindicates those right hon. and hon. Members who condemn the expansion of nuclear power and opposed Sellafield and THORP reprocessing facilities in particular—alas supported now by both the Labour and the Conservative parties—and accept that the privatisation is wholly flawed? Should not the right hon. Gentleman abandon it, and acknowledge that his announcement today is an indication that he has no interest in the environment but is interested only in maximising the industry's share price? The only thing that is green about Conservative Members is the colour of their wellies.
Mr. Parkinson: The hon. Gentleman's last remark and the reaction of the House to it summed up the level of his contribution. Privatisation is exposing the industry's existing costs, it is not the cause of them, and we are making arrangements to deal with them. The country has taken electricity from the stations concerned for more than 30 years, and they have an average of six years of life left. We are making arrangements to clear up the past and to open up a secure future for the industry.
Sir Ian Lloyd: First, I may express my hope that if the news we are likely to hear today is true, this is
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the last occasion on which my right hon. Friend the Secretary of State will have to rest on the energy bed of Procrustes.
My right hon. Friend's statement is as welcome as it was inevitable. I wish to put to my right hon. Friend four related questions. [HON. MEMBERS: "Four?"] Yes. First, my right hon. Friend said that the electricity from the Magnox stations has been generated and paid for. The fact is that the electricity has been generated but not paid for. Therefore, as my right hon. Friend said, the choice is between the taxpayer and the consumer, and he has chosen the latter.
Secondly, how will the Government ensure that there will be fair competition between the electricity that will be produced in the Magnox sector for at least a further six years and that of the rest of the private sector, including the other nuclear stations? Thirdly, how will the very large sum—it remains a matter of dispute as to whether it is the £4·4 billion suggested by British Nuclear Fuels plc or some lesser or larger sum—be distributed between Magnox, PWRs and AGRs and, broadly speaking, the reprocessing sector?
Finally, my right hon. Friend expressed confidence that after 2002 all nuclear power will be in the private sector, "where it will flourish." I share his hope but not his expectation. Does his expectation imply that, in his judgment, by 2002 the full environmental costs of fossil fuel power generation are likely to tip the balance in favour of nuclear power?
Mr. Parkinson: In the past, customers paid what was regarded at the time as a fair price for electricity, but it is clear that they underpaid. We had to decide whether in future customers should pay a fair price for nuclear electricity and, at the same time, pay the price for previous under-charging. We came to the conclusion that that would not be reasonable.
Electricity produced by Magnox stations will be paid for through the fossil fuel levy. The arrangements for that are set out in the Bill. In future, the area boards will sign up for nuclear electricity from Magnox stations, which will still be in the public sector as long as they continue to produce electricity.
AGRs have enough life ahead of them for proper provision to be made now in the price that they charge, through the fossil fuel levy, for their future decommissioning and reprocessing costs. That will be built into the price that they charge. They have enough life left for them to recover the full costs.
As I said in reply to a previous question, in other countries, PWRs are operated by private sector companies. They are privately financed, and successfully produce competitively priced electricity.
I found it interesting at Question Time that some hon. Members asked why Britain produces more carbon dioxide than France. The French produce 70 per cent. of their electricity from nuclear stations: that is why France contributes less carbon dioxide and less to the greenhouse effect. Hon. Members who argued against nuclear power were at the same time pointing to the French performance, which is based on nuclear power.
Mr. Tony Benn: Is the Secretary of State aware that what he has done today is to confirm what many people have long suspected—that nuclear power in Britain is not, and never has been, economic in any sense

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of the term? The Government have closed many pits, however, and have thrown many miners out of work on the ground that the pits were uneconomic.
Is he also aware that, in the United States, where pressurised water reactors are in private hands, not one has been ordered for 10 years? There is no reason to believe that they will be any different in their economic operations from the Magnox and AGR stations. Is the Secretary of State also aware that, by retaining the costs of Magnox stations in the public sector, he is deliberately giving an enormous subsidy to shareholders who intend to buy parts of the electricity industry? Finally, how could he say that he had no idea of the cost of nuclear power until he tried to sell it off? I think it is virtually a resignation speech when a Minister says that he did not know what he was doing until he tried to sell off an industry and the figures came to light.
Mr. Parkinson: I am an admirer of some aspects of the right hon. Gentleman, but for sheer, brass-necked effrontery, that intervention takes some beating. If I closed every pit remaining in Britain, I could not match the right hon. Gentleman's record as a closer of pits, because he closed more than any previous Secretary of State. He was also an enthusiastic supporter of nuclear stations while he held the job that I now hold. I think that I am right in saying that he ordered AGRs and approved of that technology. Therefore, having been a party to creating the problem that I am now dealing with, for him to come over at his sanctimonious worst is almost beneath contempt.
Mr. Chris Butler: What will be the effect on the price of electricity of this announcement about Magnox stations? Will it be higher or lower as a result? Will there be doubt about the decommissioning costs of other reactors as a result of the exposure of privatisation?
Mr. Parkinson: The price of electricity will not be affected by today's announcement; it will be affected by the proper charging of costs in the future. We have made, and will make, arrangements to charge properly for the cost of electricity produced by nuclear power stations. I have said over and over again in Committee that we are creating a totally transparent system. The days of pushing it under the carpet, which was the hallmark of the right hon. Member for Chesterfield (Mr. Benn), have gone. The cost of nuclear electricity will be revealed, known and declared and it will have to be defended, and I am quite happy to do that.
As I have already said, almost all the present generation of stations have a long life ahead of them. During that life, knowing what is now known, we can make provision to meet the costs of decommissioning and waste management.
Mr. James Molyneaux: In his statement, the Secretary of State said:
"This order … will give the House a full opportunity to debate our … proposals."
Will the right hon. Gentleman and his colleagues on the Front Bench ensure that that full opportunity is somewhat greater than the 90 minutes accorded to Northern Ireland business, even though it is primary legislation?
Mr. Parkinson: That is obviously a matter for the business managers. The right hon. Gentleman makes a serious point. The Government will be only to happy to have a full debate on this subject.
Sir Trevor Skeet: Since I moved in Committee, and on Report, amendments to do exactly this, may I congratulate my right hon. Friend the Secretary of State on having moved along these lines? Does he realise that it is likely to be a loss-making enterprise, unless he is prepared to add to it a mix of profitable assets, which should include the AGRs and PWRs that are being built?
If it has a mix of assets, the enterprise will be able to compete with National Power and PowerGen in the future. Will he still have time to consider that possibility?
An Hon. Member: He should live so long.
Mr. Parkinson: I think I am going to live longer than that. My hon. Friend has consistently argued this case, and I recognise that. We believe that it is necessary to clear up the past nuclear power stations. If they had a longer life ahead of them, we could make arrangements to recoup those costs, but, as I have explained, it would net be reasonable to impose on today's customers the underpricing that went on for a long time. We believe that the nuclear past should stay where it is and that the nuclear future should move into the private sector.
Mr. Alexander Eadie: May I press the right hon. Gentleman, with reference to the question about how long we will have to debate this issue, to tell us whether he is speaking on behalf of the Government when he says that there will be a full day's debate on this proposition? I am sure that he will know that Sir Winston Churchill said, 80 or 90 years ago, that the Tory party was the party of big business and vested interests. Does not the announcement that he has made today show that he has capitulated to the City, and that it is the taxpayer who will have to pay the bill'?
Mr. Parkinson: The question about a full day's debate is a matter for the business managers, but there is a strong case for it, and I hope that there will be no attempt to restrict debate to an hour and a half. I will press that point on the business managers.
We are not selling out to big business. We recognise that there has been serious under-provision, during the past 30 years, for costs that will be incurred in the future. I do not see how our action will benefit the City, or how it could be fair to impose on an industry costs for stations that will virtually not be operating under the control of the businesses involved. The stations are coming to the end of their useful lives. They were commissioned in the public sector, and they will end their days there.
Mr. Peter Rost: What is my right hon. Friend's best estimate of the cost of nuclear electricity in pence per kilowatt hour? When does he expect an announcement to be made about the ring-fenced price?
Mr. Parkinson: The negotiations between BNFL and the generators about future prices are still in progress. The information will be available when we return after the summer recess and present full and detailed proposals.
Mr. Peter Hardy: The Secretary of State suggested that, when the generating industry was originally structured, it was necessary to provide National

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Power with 70 per cent. and PowerGen with 30 per cent., so that National Power could accommodate all the existing nuclear undertakings. Does this substantial change mean that the right hon. Gentleman will be revising the very structure of the generating industry?
Does the right hon. Gentleman accept that great pleasure will be felt by investors in the privatised industry, not least the substantial proportion living abroad? The foreigners will share the loot, but the burdens and liabilities will be borne exclusively in Britain.
Mr. Parkinson: As I told the House, we are creating an electricity industry which we hope will continue well into the next century. We are building a structure that will have a very long life. We are talking about clearing up the costs of stations, most of which will be closed by the middle of the next decade, and only two of which will be operational after 1995. It is quite wrong to say that the whole structure of the industry was developed to accommodate them. We are discussing how to clear up the past and liberate the industry so that it can develop nuclear power in the future.
Mr. Michael Stern: I thank my right hon. Friend for the fact that, despite this afternoon's announcement, my constituents who work at Oldbury and Berkeley will be entitled to share in the benefits of privatisation. Does he not agree that it is a bit rich for the Opposition to criticise him this afternoon for leaving the costs of decommissioning with the public sector when that has been their policy throughout?
Mr. Parkinson: I made it clear in my statement that we would take part in active discussions with the trade unions and management to ensure that career prospects, pensions and the opportunity of a stake in the privatised industry would be available to those who work in the Magnox sector. My hon. Friend is absolutely right: we are making arrangements to deal with existing costs. We are not inventing costs, or creating them; we are arranging to clear up the costs of a group of power stations most of whose useful lives are well behind them.
Mr. Jack Thompson: I am sure that the Secretary of State has felt no pleasure in making this statement to the House. This information should have been given to him many months ago, before the Bill came to the House, by the CEGB or his own Department. Is there not a case for heads to roll? Does he accept that if the information had been available some months ago, the tenor of our debate on the Bill would have been different?
Mr. Parkinson: The fact of the matter is that only when we set about the process of privatisation were those facts forced out. They have become available in detail literally only in the last few weeks, and we have been working to produce the information and make it available. I could not have come to the House any earlier than I have.
As I pointed out in my opening remarks, everything that we are proposing is possible under the Bill: we do not need to change it. I felt, however, that the House should have specific information as soon as I was in a position to give it, and that is why I am here.
Mr. David Tredinnick: Is it not a fact that, but for the privatisation process, the real costs of
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decommissioning Magnox would not have come to light? Is that not another illustration of the benefits of privatisation?
Mr. Parkinson: It is absoutely true that, if we had not decided to privatise the industry, ways would have been found of losing the costs through the bulk supply tariff, and they would never have been revealed to the public. The privatisation process has exposed the costs, and will force the industry to make better arrangements in the future.
Mr. Alex Salmond: Is there any limit to the amount that the Government are prepared to spend to keep the nuclear show on the road? Can the Secretary of State estimate to, say, the nearest billion pounds the likely final expenditure on the nuclear slush fund of schedule 12?
As the right hon. Gentleman knows, the electricity companies are coping with the rapidly escalating costs of non-Magnox decommissioning by discounting expenditures far into the future. If one of those private companies were to go out of business before the expenditures became due, who would pick up the tab?
Mr. Parkinson: The hon. Gentleman asked about the size of what he calls the slush fund. May I point out that, at worst, it would be just over a third of the amount that we have written off in coal since it was nationalised? Considerable sums have been written off, and—as I told the hon. Gentleman earlier this afternoon—I am being pressed by Members with mining interests to write off billions this year. The idea that there is something novel about Governments' discovering under-provisions and making arrangements to deal with them is entirely wrong.
Mr. Ian Bruce: Does my right hon. Friend agree that Gridco is currently having some difficulties in organising how electricity will be priced? Can he tell us a little more about how electricity that is effectively produced from Government assets will be fed into the free market?
Having removed the difficulty of Magnox, do we really require the non-fossil fuel levy to exist for the other stations that will be run by National Power? Will my right hon. Friend also tell us how the stations owned by the Atomic Energy Authority—in particular, my own station at Winfrith—will figure in the new organisation?
Mr. Parkinson: What I said in my statement was that the future costs of nuclear electricity would be clearly shown, and would be collected from all users of the system through the fossil fuel levy. That is what it is there for—to ensure that the cost of nuclear is borne by all the industry's customers, and not just by the domestic sector, as has been in danger of happening in the past. The costs of future, properly priced nuclear electricity will be collected through the fossil fuel levy and spread among all the customers of the industry.
Mr. Giles Radice: Does the Secretary of State accept that withdrawing such a large part of the nuclear industry from the Bill at this late stage not only represents a stunning personal reverse for him but undermines what little public confidence remains in his electricity privatisation scheme?
Mr. Parkinson: I do not think that that is the case at all. I think that the fact that the Government have recognised

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the problem, revealed it and explained how they will deal with it will do nothing to destroy the credibility of the industry.
Mr. Tim Smith (Beconsfield): Is not the statement a serious indictment of the way in which the electricity supply industry has been managed by successive Governments in the past? Is it not now clear that the Central Electricity Generating Board has completely failed to provide adequately for the costs of decommissioning, that as a result its accounts in successive years must have been seriously misleading, and that consequently electricity consumers have paid too little for their electricity? Do not all those factors underline the inadequacy of nationalisation?
Mr. Parkinson: My hon. Friend is right. One would never guess from listening to the Opposition that they were defending the system that created the problem which we are tackling.
Mr. Frank Cook: I thank the Secretary of State for confirming everything that I have ever said about his grasp of his subject. He seeks to justify the withdrawal of the Magnox stations from his window display by citing the length of time left in their working life, saying that it is not fair to hand them over. Will the same criteria be applied to fossil-fuel-burning stations that have a limited remaining life? Is it not the case that, when the right hon. Gentleman claimed a number of times at the Dispatch Box that nuclear-generated electricity was the cheapest available electricity, he had been misled, and therefore had misled the House? The right hon. Gentleman has already admitted that he does not yet have the AGR and PWR costings. If we could not believe him when he was wrong before, how does he expect the House to believe him now?
Mr. Parkinson: To the best of my recollection, I have never heard the hon. Gentleman open his mouth in an energy debate in which I have taken part. I invite him to go through Hansard and find in any debate in which I have taken part any claim by me that nuclear electricity was the cheapest. I have always defended nuclear electricity on the ground of diversity of supply being the basis of security. I have never claimed that it was the cheapest. I have made it clear that I wanted to expose—and under our system we would—the true cost of nuclear electricity.
The hon. Gentleman has asked me about the costs of fossil-fuel electricity. We have written off or made deficit grants of about £1 billion to the coal industry in each of the past 10 years. The CEGB reckons that it has been paying between £500 million and £1 billion over the odds for the coal that it has been burning. We have effectively had a coal tax of between £1·5 billion and £2 billion a year every year for the past 10 years.
Mr. Tony Marlow: If large potential liabilities attach to Magnox reactors, and if the taxpayer is going to pick up the tab, will not the taxpayer get an equal or equivalent amount of additional money at the time of privatisation? Although the subject of accountancy might be a little difficult for the Opposition to understand, I wonder whether my right hon. Friend could arrange for courses in arithmetic so that at least they could work out that taking one from one leaves no difference?
Mr. Parkinson: From our first debate on this subject, the Opposition have failed to recognise that it is the City, the shareholders, who pay and the Government, the taxpayers, who receive. As a result of not loading the industry, the taxpayer will receive a better price, so the taxpayer will benefit from the realism that we are introducing into this discussion.
Mr. Geoffrey Lofthouse: Is the Secretary of State aware that, although he may tell the House that he was not aware of the costs of nuclear electricity until his statement, he was questioned on that fact 18 months ago by the Energy Select Committee? In paragraphs 147 and 148 of its report, the Select Committee said:
"First, we are worried about the costs of nuclear power … Secondly, if there are to be additional costs from nuclear power, we are concerned about where they will fall."
Is the right hon. Gentleman aware that, as recently as last week, the chairman of the United Kingdom Atomic Energy Authority told the Select Committee that it was not possible to estimate the true costs of decommissioning the power stations? Where will the tab for decommissioning fall? Is it not simply political dogma for the Government to insist on 20 per cent. nuclear power, whatever the cost, so as to enable them to run down the coal industry?
Mr. Parkinson: We are not making arrangements to run down the coal industry. For about the past 15 years, 20 per cent. of our electricity has come from nuclear power. The other 80 per cent. has been available to the coal industry, which has supplied a great deal of it. When we have privatised the industry, 80 per cent. of the market will not be supplied by nuclear. I hope that a great deal of it will be supplied by British Coal.
Mr. Michael Jack: Will my right hon. Friend confirm that the nation has a particular debt to pay to the nuclear industry, for it was nuclear electricity that kept the power flowing during the last miners' strike? Will he confirm also that the public will be reassured by his announcement that these early decommissionings of Magnox stations will be properly financed and supervised?
Mr. Parkinson: My hon. Friend is right. We are openly acknowledging costs that have been incurred over the past 30 years and have been under-provided for. Those costs are now being revealed, and we are making arrangements to meet them. That is the sum total of the effect of my announcement.
Mr. Bruce Grocott: Is the Secretary of State aware that, probably unwittingly, he has performed a service to the House, in that he has spelt out with a clarity that is unmatched by any of his right hon. Friends the complete absence of principle behind the Government's privatisation policy? It is based upon the political expediency of rewarding his friends in the City arid of providing that the tab for anything that is unprofitable is picked up by the taxpayer. If there is any other basis for the distinction that the right hon. Gentleman has enunciated today, will he please do the House the service of spelling it out?
Mr. Parkison: I have already answered that question. At the moment, all the assets and all the liabilities are in the public sector. If we maintain some of the liabilities in

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the public sector, we will get a better price for the taxpayer for what we sell. Therefore, the taxpayer both receives the benefit of the sale and bears some of the liabilities.
Mr. William O'Brien: The right hon. Gentleman has revealed how misguided he is about the privatisation of electricity. Is he aware that, for years, the decommissioning of these old power stations has been debated by the Energy Select Committee and the House? To tell the House that he has just realised the problems is totally misleading and unfair to the House. Do we take it that this afternoon the Secretary of State has revealed a forerunner to what we will have with water privatisation—the antiquated sewage works and the old reservoirs will be taken out of the sale? Is that the way that the Government are going on privatisation?
Mr. Parkinson: I have already answered that question at least five times, but because the hon. Gentleman insists, I am happy to make the point again. The Government, on behalf of the taxpayer, are selling and will receive the proceeds of the sale. The Government will also retain some of the liabilities. One must be set against the other. I believe that we have put the position clearly in front of the House. I have always argued the case for nuclear on the ground of diversity leading to security, never on the basis of price.
Mr. Ian McCartney: What we are seeing is Meltdown Man—the first nuclear meltdown in Britain. The Secretary of State has come to the House to admit that, unless he gets this proposition through, the City will not purchase the privatisation shares. What he has not said is that he is creating a third generating company. We require information about who will be responsible for the generating company and who is negotiating about the six years of average production. I assume that the right hon. Gentleman will not close all the Magnox stations on vesting day, so someone will purchase their capacity from the company. Who will be responsible for that? Who will be the chairperson who will carry out the negotiations, or is that another fix that was not sorted out before the right hon. Gentleman came to the House with his astonishing statement?
Mr. Parkinson: I made it clear in my statement that we shall come to the House with detailed proposals. We shall have discussions with trade unions and management, as I am sure that the hon. Gentleman would expect us to have. I have already committed the Government to making sure that the career prospects, pensions and security of those who work in Magnoxes will be maintained. We shall come to the House with detailed proposals on that and we shall attach them to the debate in the autumn.
Mr. Alan W. Williams: Is not this statement humiliating for the Government, particularly for the Secretary of State on the last day of his job? He is ending with a miserable climb-down. Is it not the case that the City of London has looked long and hard at nuclear power and seen an uneconomic industry which has always been uneconomic and has problems with waste and decommissioning? Is not the truth that it is just as unhappy about AGRs and PWRs as it is about Magnoxes? Is it not the case that we should not privatise nuclear power or the electricity industry?
Mr. Parkinson: I do not understand the thought processes that conclude that what I have announced today is some sort of advertisement for nationalisation, under which these problems developed. It is privatisation that is making this Government the first Government to face up to the real costs and to make arrangements to meet them. It is nationalisation that enabled these stations to be developed and operated as they are. I cannot see anything in what the hon. Gentleman says that is an advertisement for nationalisation.
Mr. Paul Flynn: In his panic statement, the Secretary of State said that Magnoxes would be part of our past. Does he agree that they will be very much present in our future? There are six Magnox stations within a 25-mile radius of my constituency, the two at Berkeley are being stripped down now, but it will take 12 years to remove the fiercely radioactive material, and the rest will stand there for at least a century. Does the Secretary of State agree that the cost and anxiety of nuclear power will be with us for many years and will be a burden on our grandchildren's grandchildren? Will he tell us today what that cost will be? In effect, the Secretary of State is making a gift to those who will buy the shares in the new industry but placing a burden on taxpayers that will be centuries long.
Mr. Parkinson: There is no source of energy that does not involve long-term clear-up costs. Is the hon. Gentleman prepared to estimate the cost of the damage to the climate, the contribution to the greenhouse effect, subsidence, lives lost and slag heaps that come from burning coal? Is he prepared to work out how many generations will pay those costs? Does he recognise that the cost of removing platforms from the North sea will be at least £10 billion and that that, too, will have to be paid for? To pretend that coal does not involve clear-up costs is to mislead oneself.
Mr. Donald Dewar: Will the Secretary of State accept that today's announcement will be seen in Scotland as an astonishing story of confusion and muddle? Is it not now clear that the chairman of the South of Scotland electricity board was right to claim at Torness in December 1988 that his board, when privatised under the Government's plans, would be wholly unsellable? Both the Minister of State and the Secretary of State denied that, but we now know that the taxpayer will simply be asked to take over the costs of decommissioning Hunterston A, which may amount to £500 million, in order to float the privatisation programme, which would otherwise sink without trace.
I accept that the Secretary of State may not be able to give details of his scheme for the Magnox stations, but surely he could give us an outline of it. Will there be a separate state-owned generating company to see them through the remainder of their life? Will there be a separate company to decommission Hunterston A, or will it be handed over to a privatised generating company in England or to the successor board in Scotland?
Is not the clear implication of what the right hon. Gentleman is saying that the boards have failed until now to face up to the realities of BNFL reprocessing and decommissioning costs? If in future the privatised companies face up to the "real costs", the implication is that there will be a specific fund for that purpose financed by the consumer to meet those costs. Will that not mean

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significantly higher electricity costs? That is the inescapable conclusion of the Secretary of State's arguments.
Finally, does the right hon. Gentleman accept that he has admitted failure and, worse still, shown a wrong-headed determination to proceed with a discredited and unwarranted privatisation exercise, irrespective of the cost?
Mr. Parkinson: The hon. Gentleman's argument is not supported by his example of Hunterston A, which will never produce a single unit of electricity for a privatised company. It will be closed at least a year before the company is floated. He is saying that we should load a new company with costs from power stations that have never contributed a single unit of electricity to it. I hope that he is beginning to realise the scale of the problems with which we are dealing.
The hon. Gentleman asked about the successor vehicle for holding the Magnoxes. We are having discussions with the nuclear installations inspectorate because it is important that the inspectorate is prepared to license that vehicle. We shall come to the House with full details of our proposals, and we shall be happy to debate them then.
Our proposals are forcing costs out—[HON. MEMBERS: "Up."] No. They are forcing costs out. They will force people to recognise what the prices are and to realise that the costs can no longer be lost in the bulk supply tariff. I should have thought that the hon. Gentleman would welcome that transparency. The result of privatisation is that prices will be what they will be. [Laughter.]
Mr. Speaker: Order.
Mr. Parkinson: Privatisation does not create the costs; it simply reveals them. To claim that, because we now know the costs, they have been caused by the action that makes us aware of them is extraordinary logic.
Mr. Speaker: Application under Standing Order No. 20.—Mr. Benn.
Mr. Harry Ewing: On a point of order, Mr. Speaker.
Mr. Speaker: I shall take it later.
Mr. Ewing rose—
Mr. Speaker: No. The hon. Member knows that I will take it later.
Mr. Ewing: You would be better to take it now, Mr. Speaker.

Industrial Situation
5.17 pm
Mr. Tony Benn: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that should have urgent consideration, namely
"the serious industrial situation directly created by Government policy, which has compelled large numbers of workers to withdraw their labour in order to maintain their living standards in the face of rising prices and higher mortgage interest charges; and to protect essential services, public safety and civil liberties, which are threatened by other Government policies."
Hon. Members who support those who are now on strike have been unable to put their case before the House and the public, and Ministers have been protected from having to justify their actions, which have precipitated the problems now being experienced by the public.
The dockers have been denied the protection of their jobs, and their employers have been dismissing those who are taking action in order to intimidate the men to return to work on the old and brutal casual basis.
Town hall staffs are the direct victims of a persistent assault upon local services, which are understaffed and underfunded, at the expense of the communities that depend on them. All this is happening at a time when the Chancellor has announced a huge budget surplus.
The basic rate for a railman is £103·60 a week, and average earnings last year were £196·80, based on overtime of 13 hours and an average 52-hour week. Contrast hat with the astronomical salaries of chairmen of major companies, such as Lord King of British Airways, who has received an increase of 115 per cent. bringing his earnings to £7,423 per week. Sir Peter Walters of BP receives £9,000 a week, Mr. Rowland £19,000 a week and Lord Hanson £23,000 a week.
During the winter of 1978–79, 48 applications were made for emergency debates on the industrial situation, and some of them were allowed by the then Speaker. I urgently request you, Mr. Speaker, to allow this application before the House rises, if only on the ground that the reputation of Parliament will be damaged if those who elected us to this place to protect their interests and concerns find that we in Parliament have no time to consider their demands for justice and fair play.
Mr. Speaker: The right hon. Gentleman seeks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
"the serious industrial situation directly created by the Government's policy".
I have listened with care to what the right hon. Gentleman has said. As he knows, my sole duty in considering an application under Standing Order No. 20 is to decide whether it should be given priority over the business already set down for this evening or tomorrow. I regret that the matter which he has raised does not meet the requirements of the order and I cannot, therefore, submit his application to the House.

Electricity Bill (Consideration)
5.22 pm
Mr. Tony Blair: On a point of order, Mr. Speaker. In the statement that we have just heard, the Secretary of State for Energy said, perhaps rightly, that no amendment to the Electricity Bill would be required to facilitate the process that he has described. But surely the proposals have very great consequences that would go to the heart of the privatisation provisions. There would be consequences concerning the structure of whatever company would hold the Magnox stations, for accounting procedures and for personnel and pensions matters. The curious thing about the statement is that the proposal will mean that whole chunks of our debates in Committee and on Report will be rendered otiose or will have taken place on a completely false basis.
May I ask you, Mr. Speaker, as a matter of urgency, to see whether, in accordance with the rules of the House, we can at least postpone consideration of the Bill until such time as arrangements can be made for a full and proper debate on the effects of the statement on the Electricity Bill?
Mr. Harry Ewing: On a point of order, Mr. Speaker.
Mr. Speaker: Order. It may help the hon. Gentleman if I say that the only thing that he can do, from the procedural point of view, is to move a motion, which I should be prepared to put to the House.
Mr. Ewing: Further to the point of order, Mr. Speaker. I apologise to you; we have got on fine during this Session and the last thing that I would want to do would be to upset you at this late stage. Nevertheless, I have a very important point of order. It concerns the effect of the statement by the Secretary of State, not on the Electricity Bill itself, although my hon. Friend the Member for Sedgefield (Mr. Blair) made an important point, but on the money resolution. The House has already passed a money resolution to the Bill. Whatever the cost of the proposal announced by the Secretary of State—we have had some to-ing and fro-ing across the House with figures of between £4·5 billion and £8 billion—that cost is clearly outside the terms of the money resolution.
Rather than allowing the House to get into difficulty by debating proposals that fall outside the terms of the money resolution, would it not be better to take the Electricity Bill off the list of business for today? I know that you do not have the power to do that—or perhaps you have. It is clear, however, that the proposals must contravene the money resolution and I ask you to look into this matter carefully before we start to debate the Bill.
Mr. Alan Williams: Further to the point of order, Mr. Speaker. I am grateful to you for the guidance that you have given my hon. Friend the Member for Sedgefield (Mr. Blair). Last week, you wisely intervened and agreed to the adjournment of questions on a statement to allow proper information to be made available, and I gather that your are willing to consider the possibility of adjourning the proceedings on the Electricity Bill. We seek your guidance, Mr. Speaker, because you will understand that, as the Secretary of State has said, there need be no further legislation. That means that this is the very last opportunity that we shall have for a debate.
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As my hon. Friend the Member for Sedgefield said, our debates over the past few months would undoubtedly have taken a very different form had the information that has been made available today been available before, not just to this House but to the other place, which will now have absolutely no opportunity to absorb the proposals. We would therefore wish to take advantage of the procedural opportunity that you have suggested. Will you please tell us when is precisely the right time to move that we suspend or adjourn further proceedings on the Lords amendments? We shall then do just that.
Mr. Speaker: The right time to move such a motion would be once the Orders of the Day have been read, and I would put the Question upon it forthwith.
Mr. Ian McCartney: Further to the point of order, Mr. Speaker. The Secretary of State said that there would be no requirement to amend the Bill. He used as his excuse the provisions of paragraph (4) of schedule 12, which refers to his powers to specify by order that the sum may exceed £1,000 million. My hon. Friends and I then asked the Secretary of State specific questions about the setting up of a company, and he admitted that he was setting up a generating company.
Mr. Speaker: Order. None of this is a matter for me. The hon. Gentleman persists in referring to what the Minister said, and I am not responsible for that.
Mr. McCartney: I understand that, but I am trying to make a point of order regarding the business before us. In bringing this business before the House, the Secretary of State has told you, Mr. Speaker, that amendments to the Bill will not be required. Yet in his statement he said that he would be setting up a generating company to deal with Magnox—
Mr. Speaker: Order. No, the hon. Gentleman must pursue this matter under business relating to statutory instruments. It is not a matter for me.
Mr. McCartney: Further to that point of order, Mr. Speaker.
Mr. Speaker: Order. It is not a matter for me.
Mr. Tony Benn: But has the Minister made a statement converting the Bill into a hybrid Bill, Mr. Speaker, in which case it is a matter for you? That is the point. The Minister has dropped the Bill today—[Interruption.] Well, he has dropped the main provisions of the Bill. He has said that he proposes to introduce a new Bill involving a public and a private generating provision, as my hon. Friend the Member for Makerfield (Mr. McCartney) has said, and the electricity will therefore come from a hybrid system.
With respect, Mr. Speaker, you will recall the arguments over the Aircraft and Shipbuilding Industries Act in 1975, when hybridity became a very important question. I am asking you, Mr. Speaker, to consider whether it is in order for you to allow a Bill to proceed when a statement has been made that contains a clear indication that hybridity has been introduced and when we are considering the Lords amendments.
Mr. Speaker: At the moment, we are supposed to be discussing Lords amendments. No amendment is to be brought forward by the Minister today.
Mr. Michael Foot: Further to the point of order, Mr. Speaker. A few minutes ago, in your guidance to the House, you said that the matter would be put to the House and that you would be prepared to consider a motion proposing the adjournment of the debate, and—if I may say so respectfully—that is the very best advice that could be given to the House. I am sure that my hon. Friends on the Front Bench will take up that suggestion and move the adjournment, in which case it will be a debatable motion, will it not?
Mr. Speaker: We have had nearly an hour on this matter, and I would certainly be prepared—
Mr. McCartney: On a point of order, Mr. Speaker. Mr. Speaker: No.
Mr. McCartney: On a point of order, Mr. Speaker.
Mr. Speaker: No!
Mr. McCartney: On a point of order, Mr. Speaker.
Mr. Speaker: No. I am on my feet, and the hon. Gentleman has been here long enough to know that he must not interrupt the occupant of the Chair.
Following what the right hon. Member for Blaenau Gwent (Mr. Foot) said, I shall put the dilatory motion to the House, if it is moved, for the reasons that we have heard over the past hour. The hon. Member for Makerfield (Mr. McCartney) must not persist in raising points of order with me that are not my responsibility.
Mr. Foot: May I confirm that the dilatory motion is debatable? I am sure that the House will understand that.
Mr. Speaker: I intend to put the motion forthwith, on the ground that we have had an hour of questions to the Minister.
Mr. McCartney: On a point of order, Mr. Speaker. Clause 63(1)(a) says that two companies
"shall be designated as generating companies".
Those words appear on the face of the Bill. The Secretary of State said today that there would be a third generating company, but there are no legislative powers in the Bill for that. That is the point that we have been trying to make. Schedule 12 provides the Secretary of State with the ability to make an order for costs. The Secretary of State does not have the power to amend the Bill today to set up a third generating company, which is precisely what he said in his statement. Clause 63 does not allow him to do that without amendment.
Mr. Speaker: That is as may be, but the Secretary of State has not brought forward an amendment.

NHS (Wales)
5.31 pm
Mr. Barry Jones: On a point of order, Mr. Speaker. Will you, Mr. Speaker, assist in obtaining from the Secretary of State for Wales a statement to the House on the National Health Service in Wales? We understand that a statement will be made, but outside the House. We have received no papers on the Health Service, but they were promised on 1 March. We have had no debate on the White Paper, but we were promised one on 1 March. Labour Members believe that the Secretary of State should make a statement before the House rises. We ask for your assistance as it appears to us that the Secretary of State for Wales is running away.
Mr. Speaker: I have no knowledge of such a statement being made outside the House, but I am sure that the hon. Gentleman's comments will have been heard by Ministers.

Orders of the Day

  Electricity Bill
  Lords amendments further considered.
  5.32 pm
  Mr. Alan Williams: For the reasons put forward by my hon. Friend the Member for Sedgefield (Mr. Blair) and me already, I beg to move,
  That further consideration of the Lords amendments be now adjourned.
  Question put forthwith, pursuant to Standing Order No. 34 (Dilatory motion in abuse of rules of the House):—
  The House divided: Ayes 186, Noes 293.

  Division No. 316]

  [5.31 pm

  AYES

  Abbott, Ms Diane

  Dunnachie, Jimmy

  Adams, Allen (Paisley N)

  Dunwoody, Hon Mrs Gwyneth

  Allen, Graham

  Eadie, Alexander

  Anderson, Donald

  Eastham, Ken

  Archer, Rt Hon Peter

  Ewing, Harry (Falkirk E)

  Armstrong, Hilary

  Ewing, Mrs Margaret (Moray)

  Ashdown, Rt Hon Paddy

  Fatchett, Derek

  Ashley, Rt Hon Jack

  Field, Frank (Birkenhead)

  Ashton, Joe

  Fisher, Mark

  Barnes, Harry (Derbyshire NE)

  Flannery, Martin

  Barnes, Mrs Rosie (Greenwich)

  Flynn, Paul

  Barron, Kevin

  Foot, Rt Hon Michael

  Battle, John

  Foster, Derek

  Beith, A. J.

  Fraser, John

  Benn, Rt Hon Tony

  Galloway, George

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

  Garrett, John (Norwich South)

  Bermingham, Gerald

  Garrett, Ted (Wallsend)

  Bidwell, Sydney

  Godman, Dr Norman A.

  Blair, Tony

  Golding, Mrs Llin

  Boateng, Paul

  Gordon, Mildred

  Boyes, Roland

  Gould, Bryan

  Bradley, Keith

  Graham, Thomas

  Bray, Dr Jeremy

  Grant, Bernie (Tottenham)

  Brown, Nicholas (Newcastle E)

  Griffiths, Nigel (Edinburgh S)

  Bruce, Malcolm (Gordon)

  Griffiths, Win (Bridgend)

  Buckley, George J.

  Grocott, Bruce

  Caborn, Richard

  Hardy, Peter

  Callaghan, Jim

  Harman, Ms Harriet

  Campbell, Menzies (Fife NE)

  Hattersley, Rt Hon Roy

  Campbell, Ron (Blyth Valley)

  Haynes, Frank

  Canavan, Dennis

  Healey, Rt Hon Denis

  Cartwright, John

  Heffer, Eric S.

  Clark, Dr David (S Shields)

  Henderson, Doug

  Clarke, Tom (Monklands W)

  Hinchliffe, David

  Clelland, David

  Hoey, Ms Kate (Vauxhall)

  Clwyd, Mrs Ann

  Hogg, N. (C'nauld & Kilsyth)

  Cohen, Harry

  Howarth, George (Knowsley N)

  Coleman, Donald

  Howell, Rt Hon D. (S'heath)

  Cook, Frank (Stockton N)

  Hoyle, Doug

  Cook, Robin (Livingston)

  Hughes, John (Coventry NE)

  Corbett, Robin

  Hughes, Robert (Aberdeen N)

  Corbyn, Jeremy

  Hughes, Roy (Newport E)

  Cousins, Jim

  Hughes, Simon (Southwark)

  Cox, Tom

  Illsley, Eric

  Crowther, Stan

  Ingram, Adam

  Cryer, Bob

  Janner, Greville

  Cummings, John

  Jones, Barry (Alyn & Deeside)

  Cunliffe, Lawrence

  Jones, Martyn (Clwyd S W)

  Darling, Alistair

  Kennedy, Charles

  Davies, Rt Hon Denzil (Llanelli)

  Kinnock, Rt Hon Neil

  Davies, Ron (Caerphilly)

  Lamond, James

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

  Leighton, Ron

  Dewar, Donald

  Litherland, Robert

  Dixon, Don

  Lloyd, Tony (Stretford)

  Dobson, Frank

  Lofthouse, Geoffrey

  Doran, Frank

  McAllion, John

  Duffy, A. E. P.

  McAvoy, Thomas

  766

  McCartney, Ian

  Rowlands, Ted

  Macdonald, Calum A.

  Ruddock, Joan

  McKelvey, William

  Salmond, Alex

  McLeish, Henry

  Sedgemore, Brian

  Maclennan, Robert

  Sheldon, Rt Hon Robert

  McWilliam, John

  Short, Clare

  Madden, Max

  Skinner, Dennis

  Mahon, Mrs Alice

  Smith, Andrew (Oxford E)

  Marshall, Jim (Leicester S)

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

  Martin, Michael J. (Springburn)

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

  Meacher, Michael

  Smith, J. P. (Vale of Glam)

  Meale, Alan

  Soley, Clive

  Michael, Alun

  Spearing, Nigel

  Michie, Bill (Sheffield Heeley)

  Steel, Rt Hon David

  Michie, Mrs Ray (Arg'l & Bute)

  Steinberg, Gerry

  Morgan, Rhodri

  Stott, Roger

  Morris, Rt Hon A. (W'shawe)

  Straw, Jack

  Mowlam, Marjorie

  Taylor, Mrs Ann (Dewsbury)

  Mullin, Chris

  Taylor, Matthew (Truro)

  Murphy, Paul

  Thompson, Jack (Wansbeck)

  Nellist, Dave

  Vaz, Keith

  Oakes, Rt Hon Gordon

  Wall, Pat

  O'Brien, William

  Walley, Joan

  Orme, Rt Hon Stanley

  Wardell, Gareth (Gower)

  Patchett, Terry

  Wareing, Robert N.

  Pike, Peter L.

  Watson, Mike (Glasgow, C)

  Prescott, John

  Welsh, Michael (Doncaster N)

  Primarolo, Dawn

  Williams, Rt Hon Alan

  Quin, Ms Joyce

  Williams, Alan W. (Carm'then)

  Radice, Giles

  Wilson, Brian

  Randall, Stuart

  Winnick, David

  Redmond, Martin

  Wise, Mrs Audrey

  Rees, Rt Hon Merlyn

  Worthington, Tony

  Richardson, Jo

  Young, David (Bolton SE)

  Roberts, Allan (Bootle)

  Rogers, Allan

  Tellers for the Ayes:

  Rooker, Jeff

  Mr. Allen McKay and Mr. Ray Powell.

  Ross, Ernie (Dundee W)

  NOES

  Adley, Robert

  Buck, Sir Antony

  Aitken, Jonathan

  Budgen, Nicholas

  Alexander, Richard

  Burns, Simon

  Alison, Rt Hon Michael

  Burt, Alistair

  Allason, Rupert

  Butler, Chris

  Amos, Alan

  Butterfill, John

  Arbuthnot, James

  Carlisle, John, (Luton N)

  Arnold, Jacques (Gravesham)

  Carlisle, Kenneth (Lincoln)

  Ashby, David

  Carrington, Matthew

  Atkins, Robert

  Carttiss, Michael

  Atkinson, David

  Cash, William

  Baker, Nicholas (Dorset N)

  Chapman, Sydney

  Baldry, Tony

  Chope, Christopher

  Batiste, Spencer

  Clark, Dr Michael (Rochford)

  Beaumont-Dark, Anthony

  Clark, Sir W. (Croydon S)

  Bellingham, Henry

  Clarke, Rt Hon K. (Rushcliffe)

  Bendall, Vivian

  Conway, Derek

  Bennett, Nicholas (Pembroke)

  Coombs, Anthony (Wyre F'rest)

  Benyon, W.

  Coombs, Simon (Swindon)

  Bevan, David Gilroy

  Cope, Rt Hon John

  Biffen, Rt Hon John

  Couchman, James

  Blackburn, Dr John G.

  Cran, James

  Blaker, Rt Hon Sir Peter

  Currie, Mrs Edwina

  Bonsor, Sir Nicholas

  Curry, David

  Boscawen, Hon Robert

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

  Boswell, Tim

  Davis, David (Boothferry)

  Bottomley, Peter

  Day, Stephen

  Bottomley, Mrs Virginia

  Devlin, Tim

  Bowden, A (Brighton K'pto'n)

  Dickens, Geoffrey

  Bowden, Gerald (Dulwich)

  Dorrell, Stephen

  Bowis, John

  Douglas-Hamilton, Lord James

  Boyson, Rt Hon Dr Sir Rhodes

  Dover, Den

  Braine, Rt Hon Sir Bernard

  Dunn, Bob

  Brandon-Bravo, Martin

  Durant, Tony

  Brazier, Julian

  Dykes, Hugh

  Bright, Graham

  Emery, Sir Peter

  Brooke, Rt Hon Peter

  Evans, David (Welwyn Hatf'd)

  Brown, Michael (Brigg & Cl't's)

  Fairbairn, Sir Nicholas

  Bruce, Ian (Dorset South)

  Fallon, Michael

  Buchanan-Smith, Rt Hon Alick

  Favell, Tony

  767

  Fenner, Dame Peggy

  Lord, Michael

  Finsberg, Sir Geoffrey

  Luce, Rt Hon Richard

  Fishburn, John Dudley

  Lyell, Sir Nicholas

  Fookes, Dame Janet

  McCrindle, Robert

  Forman, Nigel

  MacKay, Andrew (E Berkshire)

  Forsyth, Michael (Stirling)

  McLoughlin, Patrick

  Forth, Eric

  McNair-Wilson, Sir Michael

  Fowler, Rt Hon Norman

  McNair-Wilson, Sir Patrick

  Fox, Sir Marcus

  Madel, David

  Franks, Cecil

  Major, Rt Hon John

  Freeman, Roger

  Malins, Humfrey

  French, Douglas

  Maples, John

  Gale, Roger

  Marlow, Tony

  Gardiner, George

  Marshall, John (Hendon S)

  Garel-Jones, Tristan

  Marshall, Michael (Arundel)

  Gill, Christopher

  Martin, David (Portsmouth S)

  Glyn, Dr Alan

  Maude, Hon Francis

  Goodlad, Alastair

  Mawhinney, Dr Brian

  Goodson-Wickes, Dr Charles

  Maxwell-Hyslop, Robin

  Gorman, Mrs Teresa

  Mayhew, Rt Hon Sir Patrick

  Gorst, John

  Mellor, David

  Gow, Ian

  Miller, Sir Hal

  Grant, Sir Anthony (CambsSW)

  Mills, Iain

  Greenway, Harry (Ealing N)

  Mitchell, Andrew (Gedling)

  Greenway, John (Ryedale)

  Mitchell, Sir David

  Gregory, Conal

  Moate, Roger

  Griffiths, Sir Eldon (Bury St E')

  Molyneaux, Rt Hon James

  Griffiths, Peter (Portsmouth N)

  Monro, Sir Hector

  Ground, Patrick

  Montgomery, Sir Fergus

  Gummer, Rt Hon John Selwyn

  Moore, Rt Hon John

  Hague, William

  Morris, M (N'hampton S)

  Hanley, Jeremy

  Morrison, Sir Charles

  Hannam, John

  Morrison, Rt Hon P (Chester)

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

  Moynihan, Hon Colin

  Hargreaves, Ken (Hyndburn)

  Mudd, David

  Harris, David

  Neale, Gerrard

  Haselhurst, Alan

  Needham, Richard

  Hayes, Jerry

  Nelson, Anthony

  Hayhoe, Rt Hon Sir Barney

  Neubert, Michael

  Heddle, John

  Newton, Rt Hon Tony

  Hicks, Mrs Maureen (Wolv' NE)

  Nicholls, Patrick

  Hicks, Robert (Cornwall SE)

  Nicholson, David (Taunton)

  Higgins, Rt Hon Terence L.

  Nicholson, Emma (Devon West)

  Hill, James

  Norris, Steve

  Hind, Kenneth

  Onslow, Rt Hon Cranley

  Hordern, Sir Peter

  Page, Richard

  Howard, Michael

  Paice, James

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

  Parkinson, Rt Hon Cecil

  Howarth, G. (Cannock & B'wd)

  Patnick, Irvine

  Howell, Rt Hon David (G'dford)

  Patten, Rt Hon Chris (Bath)

  Howell, Ralph (North Norfolk)

  Patten, John (Oxford W)

  Hughes, Robert G. (Harrow W)

  Pawsey, James

  Hunt, Sir John (Ravensbourne)

  Peacock, Mrs Elizabeth

  Hunter, Andrew

  Porter, Barry (Wirral S)

  Irvine, Michael

  Portillo, Michael

  Irving, Charles

  Powell, William (Corby)

  Jack, Michael

  Price, Sir David

  Janman, Tim

  Raffan, Keith

  Jessel, Toby

  Raison, Rt Hon Timothy

  Jones, Gwilym (Cardiff N)

  Rathbone, Tim

  Jones, Robert B (Herts W)

  Redwood, John

  Jopling, Rt Hon Michael

  Renton, Tim

  Kellett-Bowman, Dame Elaine

  Rhodes James, Robert

  Key, Robert

  Riddick, Graham

  King, Roger (B'ham N'thfield)

  Ridsdale, Sir Julian

  Kirkhope, Timothy

  Roe, Mrs Marion

  Knapman, Roger

  Rossi, Sir Hugh

  Knight, Dame Jill (Edgbaston)

  Rost, Peter

  Knowles, Michael

  Rowe, Andrew

  Lamont, Rt Hon Norman

  Sackville, Hon Tom

  Lang, Ian

  Sainsbury, Hon Tim

  Latham, Michael

  Sayeed, Jonathan

  Lawrence, Ivan

  Scott, Rt Hon Nicholas

  Lawson, Rt Hon Nigel

  Shaw, David (Dover)

  Lennox-Boyd, Hon Mark

  Shaw, Sir Giles (Pudsey)

  Lester, Jim (Broxtowe)

  Shaw, Sir Michael (Scarb')

  Lightbown, David

  Shelton, Sir William

  Lilley, Peter

  Shephard, Mrs G. (Norfolk SW)

  Lloyd, Sir Ian (Havant)

  Shepherd, Colin (Hereford)

  Lloyd, Peter (Fareham)

  Shersby, Michael

  768

  Skeet, Sir Trevor

  Tredinnick, David

  Smith, Sir Dudley (Warwick)

  Trippier, David

  Smith, Tim (Beaconsfield)

  Trotter, Neville

  Speed, Keith

  Twinn, Dr Ian

  Speller, Tony

  Viggers, Peter

  Spicer, Sir Jim (Dorset W)

  Waddington, Rt Hon David

  Spicer, Michael (S Worcs)

  Wakeham, Rt Hon John

  Squire, Robin

  Waldegrave, Hon William

  Stanbrook, Ivor

  Walden, George

  Stanley, Rt Hon Sir John

  Walker, Bill (T'side North)

  Stern, Michael

  Waller, Gary

  Stevens, Lewis

  Walters, Sir Dennis

  Stewart, Allan (Eastwood)

  Wardle, Charles (Bexhill)

  Stewart, Andy (Sherwood)

  Warren, Kenneth

  Stokes, Sir John

  Wells, Bowen

  Sumberg, David

  Wheeler, John

  Summerson, Hugo

  Whitney, Ray

  Tapsell, Sir Peter

  Widdecombe, Ann

  Taylor, Ian (Esher)

  Wiggin, Jerry

  Taylor, John M (Solihull)

  Wilkinson, John

  Taylor, Teddy (S'end E)

  Wolfson, Mark

  Temple-Morris, Peter

  Wood, Timothy

  Thompson, Patrick (Norwich N)

  Yeo, Tim

  Thorne, Neil

  Young, Sir George (Acton)

  Thornton, Malcolm

  Thurnham, Peter

  Tellers for the Noes:

  Townend, John (Bridlington)

  Mr. David Heathcoat-Amory and Mr. David Maclean.

  Townsend, Cyril D. (B'heath)

  Tracey, Richard

  Question accordingly negatived.
  Mr. Tony Benn: May I go back to the point that I raised with you about hybridity, Mr. Speaker? I appreciate that what the Secretary of State said to the House—I do not know if he is still the Secretary of State—has no legislative authority and, having consulted the Table, I understand that only when the wording of the Bill was changed would the question of hybridity arise. I have had the opportunity of having a quick look at the Bill. I do not believe that you, Mr. Speaker, could possibly answer now the question that I am putting because there may be enough in what I am proposing to submit to persuade you that you should seek advice before you give a ruling against what I am saying.
  5.45 pm
  Clause 62 states:
  "all property, rights and liabilities to which each Area Board is entitled or subject immediately before that date shall become by virtue of this subsection property, rights and liabilities of a company which, in relation to that Board, is nominated for the purposes of this subsection by the Secretary of State."
  However, the Secretary of State has said that that will not be the case any more. In effect, he has said that certain financial liabilities in respect of the Magnox stations will remain in the public domain.
  Clearly, those are only words from a Secretary of State and have no legislative authority. However, had they been part of the long title of the Bill—the right hon. Gentleman has told us that the Bill will be interpreted in that way—you, Mr. Speaker, would have been bound to consider whether we were getting a mixed arrrangement for the supply of electricity which would affect private and public companies and consumers separately.
  In view of the sensitivity of matters relating to hybridity, which affect the House and the protection of private rights and so on, I believe that you should not reject my submission out of hand until you have had the opportunity of considering it. Therefore, I submit that

  769
  you, Mr. Speaker, in your judgment, should not allow the Lords amendments to be proceeded with until you have had the chance of taking that advice.
  Mr. Speaker: I will certainly consider carefully what the right hon. Gentleman has said, for, as he correctly stated, no legislative change is made to the Bill as a result of what the Secretary of State has said. I suggest that the right hon. Gentleman submits his reasons for what he has just said to me in writing so that I may consider them carefully.
  Now we move on to Lords amendment No. 158 with which—
  Mr. Bob Cryer rose—
  Mr. Speaker: Order. I do not think that I can say any more, and I am not prepared to rule on hybridity in the middle of Lords amendments.
  Mr. Cryer: I simply want to ask you, Mr. Speaker, at what stage does the House have the opportunity to refer such a Bill, if it is indeed hybrid, to the Examiners of the Bill, who, as you know, consist of officials from both Houses, to check on the question of hybridity? Is it following a statement by yourself when you make a decision, Mr. Speaker, that a formal motion is moved, and is that motion subject to a vote like the vote that we have just had, in which the Government can use their vast majority to tear the procedures of this place apart and thus remove the rights which protect ordinary citizens, as they have just done?
  Mr. Speaker: That matter is hypothetical until I have seen the submission to be made to me on this matter.
  Mr. Bruce Grocott rose—
  Mr. Speaker: Order. I repeat I cannot rule on hybridity in the middle of Lords amendments.
  Mr. Grocott: I am sure that you will recall, Mr. Speaker, as we all do, the tremendous seriousness that was attached to the issue of hybridity during the 1970s on crucial matters of legislation which, as far as I can recall, included a whole day's debate on whether a piece of legislation was a hybrid measure. We are all dealing with information that has come to light only recently and the information that I have received seems of similar import to the discussions that took place in the 1970s. Therefore, can we have your assurance that, when the ruling is made, the opportunity will arise, so far as it is in your power, Mr. Speaker, to determine it, for us to discuss it in the same way and with the same seriousness with which it was discussed in the 1970s?
  Mr. Speaker: I must first consider the submission that is put to me. Of course I do not control the timing of debates in the House, but I shall certainly bear in mind very strongly what the hon. Member has said.
  Mr. Benn: The point is that the passage of the Lords amendments today could lead to an attempt to get Royal Assent for the Bill immediately. Clearly, when the House has dealt with the Lords amendments, the Bill will have completed its passage through both Houses. [Interruption.] I do not know whether it depends on how the House rules on the matter. However, the point is that the matter of hybridity would have to be settled before the
  770
  Bill was cleared for Royal Assent. Once the Bill has gone for Royal Assent, it becomes an Act of Parliament. There is, therefore, an urgency about the matter. When you come to it, Mr. Speaker, you would have to interpose your judgment between the final stages in either House and the Royal Assent. You have given me an opportunity to put in such evidence as I can, which will concern clauses 62 and 63 on the generating board.
  Mr. Speaker: The right hon. Gentleman should get in that submission as quickly as he possibly can.
  Mr. Tony Blair: Further to that point of order, Mr. Speaker. Will you confirm that it will be necessary to have a ruling on the question of hybridity before the Lords amendments are passed, since otherwise the opportunity is lost? The matter is therefore urgent.
  Mr. Speaker: I understand that.

  Electricity Bill
    Schedule 12

      NUCLEAR LIABILITIES: FINANCIAL ASSISTANCE
      Lords amendment: No. 158, in page 117, line 21, after "incurred" insert "or to be incurred".
      The Parliamentary Under-Secretary of State for Energy (Mr. Michael Spicer): I beg to move, That this House doth agree with the Lords in the said amendment.
      Mr. Speaker: With this it will be convenient to take Lords amendment No. 159, in page 117, line 26, at end insert—
      "(1A) Subject to paragraph 4 below, the Secretary of State may, with the approval of the Treasury, enter into an agreement with any person under which the Secretary of State undertakes that, if such conditions as may be specified in the agreement are satisfied, he will exercise the power conferred by this paragraph in such manner and to such extent as may be specified in the agreement."
      Amendment (a), after first 'agreement,' insert
      'to be no longer than 5 years in duration.'
      Lords amendments Nos. 160 to 162.
      Mr. Spicer: The amendments will fulfil the commitment given by my noble Friend in another place to put the provisions of schedule 12 on a firmer footing. It is important that the nuclear generators should have the certainty of knowing that the Government will stand by their assurances to provide funds, and the amendment simply provides for the Secretary of State to enter into contracts to meet those obligations.
      The Opposition amendment (a) to Lords amendment No. 159 seeks to restrict the length of the contract to five years. That would make the policy unworkable. The contracts need to last long enough for the Government to make the payments when they fall due. The stage 3 decommissioning of power stations may not take place for 100 years after the station has closed, and vitrified high-level waste will not be finally disposed of until at least 50 years after vitrification. It is essential, therefore, for the contracts to be capable of lasting for a long time. While accepting the Lords amendments, I would ask the House to reject the Opposition amendment.
      Mr. Blair: The Lords amendment alters substantially the position as it was in the Committee and Report stages of the Bill here. The Secretary of State said in his statement today that if there had been any benefit of privatisation, it was to have exposed the economics of nuclear power. It is

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      worth pointing out that it was only two and a half years ago that Mr. Hadley, the secretary of the Central Electricity Generating Board, appeared before the Sizewell inquiry and proclaimed that the Magnox reactors, about which we have heard a lot this afternoon, were saving the consumer some £250 million a year. Throughout the history of nuclear power until privatisation, we were told consistently that it would be cheap. Indeed, that was the primary case submitted by the CEGB in support of Sizewell. What has happened since then is not that by some magical process of privatisation or a great evolution of market power it has become clear that nuclear power has become more expensive, but, in crude terms, that, where it used to be in the interests of the electricity board to tell us that nuclear power was cheap, it is now, short-term at least, in its interests to tell us that it is expensive so that it can get more guarantees and more subsidies from the Government.
      When we debate the schedule and the Government amendment, we should remember that we are not merely debating those nuclear liabilities, but we are debating them against the background of the nuclear tax to pay for the new PWR stations that will be costing the consumer about £20 or £50 a year. The nuclear quota will remain in being and will ring-fence the nuclear industry in that special way, but the cost of decommissioning, which will form part of the nuclear liabilities cost, will arise not merely in respect of the Magnox stations that have been shuffled back into the public sector today, but in respect of the PWR stations that are about to be decommissioned in the United States. The estimates of cost for commissioning the advanced gas reactor stations are again escalating at a fairly rapid rate.
      During our deliberations we heard much from the Secretary of State about how he wants to rid us of the iniquities of the cost-plus system, but under privatisation, and under the provisions relating to nuclear liabilities, we will have cost plus and then the profit on top of that necessary for the private sector to take a dividend for its shareholders.
      The amendments have a peculiar and coloured history. My hon. Friends will remember that in Committee those nuclear liabilities for the end-of-cycle costs of decommissioning, reprocessing and disposing of nuclear waste started off as simply those costs that were entirely unforeseeable. The only example that we received during the entire Committee stage was that a future Government might bring forward stage 3 of the decommissioning process and that would add to the cost. That would indeed add to the cost. Indeed, recent estimates show that it would add about £200 million to the cost of decommissioning the power stations. I add, too, that it appears that the fact that a future Government may change our procedures to bring them into line more with those procedures operating as best practice abroad is entirely foreseeable. Why we should guarantee and insure a private sector company against that risk, I do not know. That is the only example that the Minister gave us during Committee of where the schedule would be activated.
      We were then told in the other place, when the matter was debated, that that was to be extended not merely to items that were unforeseeable, but to what were called, in the words of Baroness Hooper, factors "outside the industry's control". That is an utterly vague statement on which we should have clarification today. What has happened, too, between our debate in Committee and the Bill's returning to the Floor of the House for Lords
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      amendments is that the discretion of a Secretary of State to exercise power and to give nuclear liabilities the underwriting in the way I have described has gone and has been replaced by these words in the amendment:
      "the Secretary of State may, with the approval of the Treasury, enter into an agreement with any person under which the Secretary of State undertakes that, if such conditions as may be specified in the agreement are satisfied, he will exercise the power conferred by this paragraph in such manner and to such extent as may be specified in the agreement."
      In other words, a discretion has been replaced by a binding agreement into which the Government now want to enter to shore up the nuclear side of the privatisation.
      The importance of that is that the discretion would be exercisable at the time when the contingencies against which it is guarding arise. Therefore, the discretion might be exercised when a future Government change the decommissioning plan or when the factors "outside the industry's control" materialise. I hope that the Minister will deal with that point.
      Presumably the arrangement in the Lords amendment now contemplated by the Minister will be agreed to before privatisation. The purpose of the amendment, therefore, is to give binding rather than discretionary guarantees to the industry before privatisation. Surely it becomes all the more important that we should assess the contingencies that may give rise to that binding agreement and what its terms would be.
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      A binding agreement will be entered into as a result of the amendment and Parliament will give the power to make that agreement. The extraordinary thing is that we do not know the terms of the agreement, its duration, the contingencies against which it may arise or the consequences of the agreement for public sector funding. Nothing is known about this open-ended agreement to subsidise a private sector company from public funds. It is therefore outrageous for the Government to enter into such an agreement on our behalf in order to shore up a privatisation which, as we heard earlier today, is failing so badly.
      Why have the Government not taken all the nuclear power stations rather than just the Magnox power stations out of the privatisation? The explanation is perfectly simple and it is an important one to remember when considering the amendment. The Government have not taken the Magnox stations out because they have a greater appreciation of the future success of the other stations compared with those Magnox stations—some might argue that the advanced gas-cooled reactor stations are in a worse shape than the Magnox stations. The Government have withdrawn the Magnox stations because they know that if they took all nuclear power out of the privatisation, as we urged them to do, they would have to withdraw I he Bill.
      In Committee and throughout the passage of the Bill we were told that the 70:30 per cent. split between National Power and PowerGen was necessary to ensure the marketability of the nuclear sector within the industry's structure. If the Government withdrew nuclear power from that structure, they would then have to withdraw all the structure.
      It is important to remember that, under the agreement, the price that we shall pay has been upped from £1 billion to £2·5 billion. That is the sum for which we, as taxpayers,

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      will be liable. The price that we pay as taxpayers and consumers is, no more and no less, the price of saving the Government's face.
      I must make it clear that we wholly repudiate the notion that the Government should be allowed to enter into an open-ended agreement for the public subsidy of a private sector company. We do not regard the introduction of the amendment as a proper exercise of ministerial discretion.
      Mr. Malcolm Bruce: Today's statement has sharpened the purpose of the amendment and for many outside it will be put into sharp focus the commercial and safety risks associated with nuclear power. During the past 15 years the Government have had an incredible record of misinforming the public about the case for nuclear power. It is therefore difficult to see how any innocent speculators can be reassured by the Government's admission that the Magnox stations are too big a risk to be privatised, but that they should not worry as the Government will underwrite the risks of the other nuclear power stations. People are supposed to be reassured that those stations do not suffer the same problems of uncontrolled costs and environmental complexities as the Magnox stations. We have heard it all before and no one should take the Government's word about nuclear power.
      Over the years the views of many of us have been vindicated. Throughout the passage of the Bill we have given the Government the benefit of our advice, but they have refused to take it even though, at the last gasp, we have been proved right and they have been proved utterly wrong.
      The amendment is an open cheque as it is an attempt to get the House to accept that the private sector, which will run the nuclear power stations, should have unlimited access to taxpayers' money to cover the cost of its commercial mistakes, engineering failures, the difficulties associated with reprocessing, however unpredictable, or any other environmental consequences of the industry's activities. I hope that the Minister can tell us what other part of the private sector of the economy has such cast-iron, gilt-edged and open-ended guarantees. If such an amendment had been tabled by an Opposition party to cover any other industry it would have been ridiculed and condemned by the Government. Here they are, however, asking the House to accept a Lords amendment that will provide such guarantees.
      The Secretary of State told us that he has only just discovered that nuclear power is more expensive than people thought. Many of us could have told him that a long time ago if he had been prepared to listen.
      Mr. Rhodri Morgan: The right hon. Gentleman has moved rapidly.
      Mr. Bruce: That is true. The right hon. Gentleman has told us that it has just become apparent that the cost of reprocessing is escalating at an unprecedented rate. Those of us who study the industry could see that coming and, in the circumstances, the escalation in costs is not entirely surprising.
      It is not just a matter of problems associated with reprocessing as other changes are taking place. The hon. Member for Sedgefield (Mr. Blair) mentioned Baroness Hooper. She said that risk was being shared in such a way
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      "in areas which are not subject to the control of the nuclear operators"
      That underlines my point about the amendment being an open cheque. She also said:
      "We must look very carefully at this area to see whether we can give greater certainty to the investor and the public that the Government will meet their side of the deal. Therefore, at Report stage we intend to table an amendment to Schedule 12 to enable the Secretary of State to enter into binding commitments in this respect."—[Official Report, House of Lords, 19 June 1989; Vol. 509, c. 20.]
      That quote sums up the Government's attitude. They are much more concerned about the potential investor than they are about the best strategic way in which to run the industry or about meeting the public's concern about nuclear power.
      The cost of reprocessing has escalated and is continuing to escalate dramatically. What happens if the cost of reprocessing makes nuclear power stations unviable? Today's statement does not make any difference. The entire cost of the lost capacity would fall on the taxpayer; there would be no risk to the shareholder. What would happen if Sellafield or THORP—the thermal oxide reprocessing plant—were closed on safety grounds? As a consequence the Magnox power stations would have to cease to produce. Who would bear the cost of that? Who would find the replacement capacity? The answer is that the taxpayer would bear the cost. To pretend that normal risk analysis or risk management would operate is an extraordinary distortion.
      There is evidence to suggest that my theory is not just a fanciful concern. At the Hinkley inquiry the National Radiological Protection Board said that evidence of recent years suggested that the acceptable radiation dose had been set at too high a level. It suggested that the level should be reduced to a fraction of the current level. If what the board is proposing were introduced, it would mean that about one third of the employees at Sellafield would be exposed to radiation levels above the safety level projected by the board. The Minister must acknowledge that, if that is so, it is difficult to see how Sellafield or THORP could continue to operate. Already they have been threatened with closure, and if that happens the consequences for the taxpayer will be phenomenal.
      Earlier, the Secretary of State tried to impugn the Labour party's commitment to the coal industry, and what it has cost the taxpayer, and I suppose that the Opposition's commitment is fair game. But what the Government are proposing is potentially a far greater commitment than that to the coal industry. The Bill is already committed to costs of more than £7·5 billion, and they go up by about 20 per cent. every time it returns to the House. I imagine that there will be numerous orders in the coming years on occasions when the Government come back to the House to seek further consent to increase borrowing to cover the costs of decommissioning and rising reprocessing charges.
      Until recently, not many people suggested that we would simply abandon a decommissioned nuclear power station in a concrete shell for 100 years. Interestingly, the industry has tried to make that sound like an acceptable proposition, but I do not think that it will prove acceptable to have a decaying nuclear power station—monitored though it may be—wrapped up in concrete as a monument looming over people's communities. People will want total decommissioning; they will want stations removed; they will want land to be freed from the blight put upon it—
      Mr. A. J. Beith: Will not that be especially true in cases in which the generating board has its eye on greenfield sites and beauty spots like Druridge bay in Northumberland, where there will be not only a building but a structure that will last for 100 years?
      Mr. Bruce: My hon. Friend raises a pertinent point. This factor will be used by objectors in future planning inquiries into the implications of building nuclear power stations. No longer will the industry be able to say—however unacceptable even this might be—that it is a question of a 25 or 30-year cycle, and then the structure will be removed. People know that it is so difficult to succeed in planning applications that one fades away, then another comes along, followed by another. My hon. Friend's point was a fair one: many communities will find it wholly unacceptable that a piece of land is likely to be frozen and out of use for up to 200 years. At least with a conventional power station, they know that it can be removed and that the site can be levelled within a generation or a generation and a half.
      All those factors will affect the cost and liability of the industry. They will make many people reluctant to invest in it. We are faced with this prospect because of the consistent resistance of the City and other quarters to the saleability of a private electricity company based on nuclear power. and on Magnox reactors in particular. A poll published recently showed that about 17 per cent. of the population said that they might be willing to buy shares in the privatised electricity industry, but on closer questioning, more than half of those said that they would not buy shares if they included a nuclear component.
      The Secretary of State may have had the worst of both worlds. He has failed to remove nuclear power altogether from the privatisation, but he has removed enough of it to tell these people that their judgment about the nuclear power industry was right and that an investment that requires them to buy into it is likely to be difficult—except that the Minister will be able to wave this proposal in front of them and tell them that they will make a profit while the taxpayer bears all the risk. The Government have signed up a wonderful deal for the investors. That is dishonest and immoral and it represents a principle that the Conservative party would not defend in any other context. It is the worst sort of double standards and double dealing to be brought before the House on this matter.
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      The public should share my view and, if they have any sense, stay clear of the industry, and not only because it is not necessarily a sound investment: it is a bad risk with which they should not wish to taint their hands.
      The Government are asking for an open-ended commitment which will leave investors feeling uncomfortable, which will not satisfy public concern and which will underline the fact that nuclear power should have stayed in the public sector. Surprisingly, the hon. Member for Bedfordshire, North (Sir. T. Skeet) is not in his place; I should have thought that he would be anxious to contribute. He said from the outset that nuclear power should be kept in the public sector, as did the CBI. Many of us who opposed the privatisation recognised that it would have been tidier without the nuclear industry. It is extraordinary that the Government have not even been prepared to accept good advice either from the Opposition or from their own Back Benchers. We believed that,
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      although privatisation should not go ahead, without the nuclear industry the argument for it could stand on its merits.
      The Government have conspicuously failed to realise that. Their proposal involves a blank cheque which will mean, over time, that the industry will cost this country, in subsidies from the taxpayer, more than the coal industry has done to date—and by a substantial margin. It will do so in circumstances that utterly destroy the rhetoric for privatisation. This is a dishonest piece of legislation, of which this amendment is the most dishonest part.
      Mr. Alan W. Williams: I find it strange that we are debating schedule 12, in view of the Government's statement this afternoon. As Magnox reactors have been removed from the intended sale, I should have thought that at least half the problem of decommissioning has been removed from the privatisation, and I would expect dramatic changes in schedule 12, the more so since Magnox reactors are near the end of their lives and will incur these costs first.
      The same goes for all our discussions today. The changes implicit in the statement should be subjected to the sort of discussion that we had in Standing Committee, because many of the premises have been wholly changed.
      There is a fundamental objection to schedule 12. Why should the public carry all the risk of the escalating costs of waste and decommissioning? The sums mentioned in this context—£1 billion or 12·5 billion—are small compared with what I suspect the true eventual figures will be.
      We have no real idea of how we shall get rid of high-level nuclear wastes. Intermediate-level waste will be given a shallow burial, probably at Sellafield. That will be very expensive and I do not think that the public, even near Sellafield, will accept it. Ideas for high-level wastes are still at the design stage. No country has got rid of its high-level waste, and the costs will run on for up to 100 years. The wastes will stay radioactive for hundreds or thousands of years, so how can we estimate the costs? One billion pounds or £2·5 billion seem trivial amounts compared with the true costs. Estimating the cost of decommissioning is crystal ball gazing. We understand that for Berkeley the cost may be about £300 million. Stages 1 and 2, which involve taking out the waste and reprocessing, will certainly account for that. We have no idea of the cost in 100 years time of dismantling the power stations and £300 million sounds like a terrific underestimate. Experts in the industry think that the cost could be anything up to £2 billion per reactor. That figure is from the Financial Times newsletter article, "Power in Europe" which is edited by Mr. Andrew Holmes. Where will that money be found?
      In Committee we tried to estimate the foreseen costs for waste and for decommissioning and arrived at figures of £10 billion, £12 billion or £16 billion. Those are the present guesstimates. Apart from the guesswork involved in arriving at such figures, the fundamental objection to schedule 12 is why should the public carry the risk, especially in view of today's statement that Magnox reactors will be left out of the privatisation. The new privatised National Power will have AGRs and PWRs which will run for 20, 30 or 40 years. Presumably they will be operated at a profit but, if not, there is the nuclear tax to fall back on. When it comes to waste and decommissioning, the buck will be passed back to the taxpayer. Schedule 12 is wrong in principle.
      Mr. Alex Salmond: I should like to put two questions to the Minister to see if we can clarify the economics of the nuclear industry in the Government's mind. I understand that the Government now accept that the nuclear industry is not fully economic. In a whole variety of ways and through some ingenious subsidies, ways are to be found to subsidise the industry or to give comfort to private investors thinking of investing in nuclear power stations.
      Can the Minister of State, Scottish Office tell us whether that is still the Government's thinking in terms of the Scottish nuclear industry? In Committee, the Secretary of State for Scotland still maintained that the nuclear industry was fully economic, and the most cost-effective method of generation in Scotland. My first question to the Minister is whether the Government feel that nuclear generation is not economic in England but is economic in Scotland.
      If it is fully economic in Scotland, how does that square with the evidence given last week to the Select Committee by the chairman of the Atomic Energy Authority? Under the most strenuous questioning by the hon. Member for Pontefract and Castleford (Mr. Lofthouse) the chairman of the authority accepted the argument that the final decommissioning costs of nuclear power stations were unquantifiable at this stage. If the chairman of the Atomic Energy Authority is correct about that, how on earth can the Secretary of State for Scotland maintain that in Scotland the economics of nuclear generation is comparable with other power sources?
      Perhaps the Minister of State will make a careful note of my second point, so that, when the Secretary of State returns, he will be able to give an answer to a question on which I manifestly failed to extract an answer from him earlier today. Given that the electricity companies are discounting over a long time the possible costs of decommissioning nuclear power stations, what will happen if the private companies go out of business before the costs fall due? Who will pick up the tab if the private companies which are to be given that responsibility are no longer around to meet the costs?
      Mr. Ian Bruce: I should like to comment briefly upon the way in which the Government have decided to unscramble the electricity industry in a very much different way from that which was originally proposed. Many of us understand the problems that any Government would face in trying to privatise a complex industry such as electricity generation and separate the different companies and the way in which they will operate.
      The Government were correct to decide that there should be competition. I have always felt that perhaps the nuclear element of the industry should consist of one or more separate companies. The amendments are sensible, because the Government need to have powers to take account of contracts and other such matters. It is rather strange that the Opposition should try to defeat such contractual arrangements because, basically, the Government are seeking the ability to set out what is for sale and the agreements that are to be made in the industry. They seek to be able to say to potential investors that this is the way in which the Government will take out uncertainty about the reprocessing and decommissioning costs on the nuclear side of the industry. By doing that, the Government are not subsidising investors or giving them
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      additional profit. By taking out that uncertainty, they are ensuring that the price paid for the other assets is much higher than it would be if such a doubt were allowed to influence the price. They are protecting the assets of the Government and the taxpayer by doing it in that way.
      I stress to the Government that the uncertainty about the way that decommissioning and reprocessing will be dealt with is causing problems. Like any Back Bencher, I appreciate the Government's difficulty, because every time they make a decision about the way that we are to dispose of or reprocess waste, the NIMBY syndrome appears. That is designed to stop us taking decisions, and sometimes we have to go down what seems to be long and involved roads and try to put nuclear waste within a constituency that is already so heavily committed to the industry that it feels that it must provide a site for the spent fuel.
      The Government's nuclear policy contains some imponderables. As we know, the City dislikes imponderables and will take the worst case and add 50 per cent. for good luck. Taking out the Magnox stations is a sensible idea. However, the Secretary of State for Energy has left within National Power a hostage to fortune, in that the management of that company could well use it as a milch cow by putting all the costs that it possibly can on the nuclear side, knowing that the rest of the industry will provide a subsidy.
      The AGR stations and the future PWR stations should be shown to be economic. Given the additional costs of solving coal-fired problems of pollution and the cost of "greening" fossil fuel burning, we shall see the equation between nuclear generation and coal-fired generation turning around. It is necessary to have within the Bill powers to give nulcear power a subsidy, if it is needed. However, I hope that my right hon. Friend the Secretary of State will look carefully at ways to introduce a profitable nuclear industry and stretch it out.
      The Atomic Energy Authority and British Nuclear Fuels plc are left in doubt as to what will happen to the nuclear stations that they are running. In my constituency, there is a steam generating heavy water reactor, which was designed many years ago as an experiment—the first-off of a type of reactor that was then cancelled by a previous Secretary of State for Energy, the right hon. Member for Chesterfield (Mr. Benn). This station has a fairly limited life left, because its generators and other equipment will not last. We were assured that the station would be included in the non-fossil fuels requirement. Today's statement leaves us in some doubt about how this station will be dealt with.
      The powers in the Bill are designed to help the Government to provide a sensible solution to the great difficulties of producing a privatised, denationalised electricity industry, and I commend them to the House.
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      Mr. Peter Hardy: As I had to see a Minister about an urgent constituency matter, I missed part of the debate.
      Mr. Giles Radice: Which one?
      Mr. Hardy: They change so frequently that it is difficult to remember.
      I shall not detain the House for long, but I have one or two important points to make. The other day, I took part

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      in a "Worldnet" television programme, which lasted the best part of an hour, between Strasbourg and Washington. Taking part were an American senator in Strasbourg and other American politicians in Washington. It was interesting to hear them say that an expensive, large nuclear power station had been built close to Long Island, but although it was now just about complete, it would never function because they believe that it is neither acceptable nor economic.
      The Secretary of State's statement about Magnox may have bought him some time, but whoever is Secretary of State for Energy after we come back from the recess will be appearing before the House to make yet another concession to try to make this privatisation work. Even with this concession, National Power will not be a successful flotation. The City may view PowerGen as dramatically more likely than National Power to succeed, because it has no nuclear encumbrance. However, if what I said both in Question Time and in the debate last Thursday is right, about the sheer fecklessness that we are about to experience as National Power approaches its launch in a few days' time, the City and many investors will be put off.
      My last point echoes the point that I made when I asked a question of the Secretary of State after his statement. The prospect of electricity privatisation may be more attractive now in Tokyo, Frankfurt, New York and other such places than it is in London.
      Sir Trevor Skeet indicated assent.
      Mr. Hardy: I am glad to have the endorsement, from a sedentary position, of the hon. Member for Bedfordshire, North (Sir T. Skeet), who is the only Conservative Member to emerge with any credit from this sad and sorry tale. As he quite properly pointed out to the Secretary of State—false modesty has no place in matters as serious as this—he proposed in Committee the very step that the Secretary of State has taken today.
      Mr. Morgan: Part of it.
      Mr. Hardy: The hon. Gentleman suggested part of the step. One recognises virtue on a larger scale than it might deserve. However, the hon. Gentleman recommended a course of action that we supported in Committee but the Minister rejected. It would he interesting to ascertain how much the dilatory response of the Secretary of State to that proposition has cost us. The Secretary of State may feel that privatisation is more worth while, but the City of London, in assessing the economics of privatisation, may now recognise, despite all the cosmetic actions that have been taken, and all the to-ing and fro-ing to No. 10, the Government now look like a sick Government, or a partial Government. They look like a partisan Government, concerned only with the interests of those who will be seeking to make a little money out of privatisation. Today's action will not make privatisation successful, and it will assist neither the new electricity industry nor the cause of those who wish to see the business of this nation conducted competently.
      Sir Trevor Skeet: I apologise to the House for not being here earlier, but I had to attend to one or two matters. I was here for the interesting statement by my right hon. Friend the Secretary of State for Energy. I asked a question afterwards and suggested that my right hon. Friend could have gone a bit further. It is a wise man who
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      recognises that, taking all the factors into account., a change is necessary. It shows the effectiveness of the Committee system when a Secretary of State listens to the arguments of Back Benchers, listens to the arguments put on Report, and eventually makes a modification. I find this one helpful. [Interruption.] I can remember when the Labour party introduced a groundnuts scheme, which cost us £36 million. An argument was put forward carefully in Committee and the Government are big enough, wise enough and awake enough to weigh up the arguments and bring out the desired modifications.
      The crux of the Bill can be found in clauses 30, 32 and 93 and the schedule 12. We are dealing here with the schedule. When we deal with structures that will be closed down by the turn of the century, some revision must be made. Has it occurred to Labour Members that we are now building a third unit into the competitive exercise? We shall have not only National Power and PowerGen, but the British nuclear firm. In Committee, I made the modest suggestion that if we put some of the other nuclear assets into this body, it would be extremely competitive, and would be the third side of the competitive wedge. If we bring in the renewables, towards the end of the century. more competition will be introduced.
      Mr. Morgan: The hon. Gentleman is rather jumping the gun. We were given no details to show that there will be a third company. If this were done by means of a sale-and-leaseback arrangement, that would not be the case. The Secretary of State gave no sign that a third company to supply nuclear electricity in England and Wales, with a bit of Scottish Magnox, would be set up.
      Sir Trevor Skeet: It can be done in two ways. If the Magnox assets are retained by the state, those in Scotland and England will be either pooled into one company, or leased back to the enterprises. Final responsibility will rest with the state. That gives an additional guarantee to those concerned and to any disquieted members of the public that they can have full confidence in the privatisation that will ensue.
      Further details will have to emerge. We shall have to ascertain precisely how these measures will be implemented. I have no doubt, however, that the right concession has been made at the right time and that it will lead to a successful flotation of the companies. The concession was made because the market required it—the market wanted the removal of uncertainty. It would not have been possible to continue with such a large measure of uncertainty.
      Unfortunately, schedule 12 was not discussed at any great length in Committee. However, the Government were told that additional money would be required for the reprocessing of nuclear fuels, for their storage—much depends on where we put them—and for the disposal of nuclear waste. The Government were prepared to set aside as much as £2·5 billion, but the first tranche was to be a much smaller sum than that. If the Secretary of State wants to put more money up front, I can understand his reasons.
      Let us try to understand what decommissioning is. For the first 50 years little will occur. That will be the cooling period. It will be a long time before the decommissioning can be amortised. We must understand that the Central Electricity Generating Board has been making provision for the eventual decommissioning of its stations. I do not

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      think for one moment that it has made satisfactory provision, but some provision has been made. I understand that it intends to make more and more provision as time passes. There is an advantageous position because the state enterprise in which the company is vested will remain with the Department of Energy, and the Department will be responsible for the reprocessing of the fuel elements. It will be responsible also for ensuring that any necessary repair work is carried out. It will be responsible for decommissioning.
      Mr. Salmond: I am sure that the hon. Gentleman has read the Select Committee's report on the accounts of BNFL, which contains the following passage:
      "Using decommissioning to shift the burden of costs to future generations has little to commend it in economic or accounting theory or moral principle, particularly if the burden so shifted is a very substantial one."
      Does the hon. Gentleman endorse that view?
      Sir Trevor Skeet: We must remember that there are cycles of popularity. The nuclear industry was extremely popular a few years ago but popularity has now shifted to fossil fuels. I think that in the years ahead the nuclear industry will become more popular. Fossil fuels have the disadvantage of CO2 sulphur dioxide, metals coming out of stacks and so forth. All these consequences have to be avoided and the shoe can move on to the other foot, as it were. Much depends on the amount of coal that comes on to the market, and it may be more restricted than we think. If that is so, the nuclear industry will gain in popularity. I should think that that would happen in about two or three years' time.
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      Who would have thought that the price of uranium would have fallen from about $45 a pound to below $10? That fall in price has meant that it has become not especially profitable to operate all sites. With any commodity there will be periods of expansion and improvement followed by a period of deterioration. I have full confidence in the nuclear industry. It is wise to keep the nuclear industry going in the United Kingdom for the time when there will be improvements and expansion. Some countries have decided to let their nuclear industries go. If we followed that example, teams of experts would be disbanded. If £2·5 billion is made available for additional expenses and costs, the nuclear industry can be kept intact to a certain extent. That must be the desired consequence.
      We have been told that no new nuclear power stations are being built in the United States. We must remember that the price of coal in the United States is very different from the price in the United Kingdom. The price here is relatively expensive, but in the United States the nuclear industry cannot compete with coal. I agree that the competitive element has gone in the United Kingdom that is on an 8 per cent. discount rate—but there are greater advantages here than there are in the United States.
      Mr. Geoffrey Lofthouse: Does the hon. Gentleman think that he or anyone else can estimate the full cost of nuclear power, including decommissioning? It is all very well to talk about the next 50 years, but somebody will have to pay the full cost at the end of the day. It is likely that for two or three decades the private sector will make a profit from our nuclear industry.
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      When the time comes to pay for decommissioning, the bill will probably be met by the public purse. Is that what the hon. Gentleman advocates?
      Sir Trevor Skeet: If a plant is dismantled, it normally has to be dealt with there and then. When a nuclear plant is decommissioned, it has to be left to cool for a number of years. That applies especially to the reactor. The first phase may be 50 years. We then enter subsequent phases. Therefore, nuclear costs can be phased over a period. There is ample opportunity to do that. The purpose of the provisions that we are discussing is to meet the future possibility of vastly increased costs. When we dealt with this issue in Committee, I recommended that the Magnox assets were not very valuable and that they should be written down to some extent. It could be argued that some of the assets in the coal industry are similarly not of great value and that they should be written out of the accounts. I recommended today that the coal industry should be subject to a reconstruction. It may be that after 100 years have passed we shall have to examine certain aspects of the nuclear industry with a view to deciding what should happen next.
      I think that the Government are moving in the right direction. They have taken up the Magnox stations and kept them within the state scheme. I agree that they could have gone a step further, but they have not done so. A partial contribution is an extremely valuable asset.
      Mr. Ian McCartney: The Lords amendments stem from the directors of the National Westminster Bank. I have no doubt that the Secretary of State for Trade and Industry was to be seen scurrying to his inspectors to get them to examine the figures proposed by the Central Electricity Generating Board. We are talking not of a blank cheque but of the complete underwriting of a share issue because of the Government's fear that the City will not purchase at a sufficient level and that there will be a disaster on flotation.
      These are not party political points being advanced by those who are opposed to the principle of privatisation. The issue arose in January in Committee when, fortuitously, the then chairman-designate of National Power sent a letter to my hon. Friend the Member for Sedgefield (Mr. Blair) in which he set out his concerns about the flotation of the company. He was anxious about its being saddled with the decommissioning costs of the nuclear industry. He argued against the underwriting by the company of the cost of fuel storage. He urged that the Government should construct a financial settlement that would protect BNFL, limit risks and enable it to be ripened, as it were, for future privatisation. The chairman-designate was opposed to the declared policy of the Department of the Environment that the polluter must pay. He said that, carried to its logical conclusion, such a commitment hung round the neck of the company would mean an unsuccessful flotation on the stock market. He said that he expected the Secretary of State for Energy to come up with proposals that would not only loosen the strings of that commitment, but would mean the Government picking up 100 per cent. of the continuing costs of nuclear decommissioning and the underwriting of fuel storage costs.
      The Minister of State, Scottish Office is on the Bench and will respond to this debate. No doubt the Secretary of State and his Under-Secretary have been either successful

      783
      or unsuccessful in the current operations at No. 10 Downing street. Perhaps we will be told later today what has happened. Will the Minister either confirm or deny that in January the Secretary of State received a letter from Mr. Baker making it clear that unless he introduced suitable amendments in another place it would be almost impossible to achieve a successful flotation of National Power? It is important that the public understand that the purpose of the amendments is not to provide some equalisation of market forces within the industry following privatisation; it is no more and no less than the use of taxpayers' resources to fund the flotation—a flotation which scares the Secretary of State stiff.
      Mr. Baker's letter also made it clear that National Power was not prepared to agree to any commitment to phase 3 of decommissioning. He said:
      "There is no way that you can guarantee that National Power will not become insolvent over the next one hundred years. Any impediment on National Power is only likely to increase the chances that it will not survive."
      He said that that would
      "significantly reduce its attractiveness to investors".
      The amendments are designed purely to improve the attractiveness of the industry to potential investors, and the necessity to do that has obviously been quite clear since Mr. Baker's letter last January. My hon. Friend the Member for Wentworth (Mr. Hardy) was right to say that the beneficiaries of this policy will not be the taxpayers or the investors of the United Kingdom, but the foreign private capital investors who will buy the shares in the marketplace.
      The Minister must clarify the statement made in another place about the Secretary of State giving up the power to decide on grants for unforeseeable costs. Indeed, under the amendments the Secretary of State relinquishes any power logically to decide on claims for the cost of decommissioning. By giving a blank cheque to the privatised companies he hopes to improve the chances of a successful flotation.
      During the months since the Bill first entered its Committee stage, it has become increasingly clear that the public do not think that privatisation will benefit the nation. The Secretary of State has tried to push through this amendment while the manoeuvring at No. 10 is grabbing the headlines. He will not be successful—
      Sir Trevor Skeet: The hon. Gentleman made a number of speeches in Committee. Does he accept that in most countries the private sector electricity industry is successful? That is partly because it involves an element of competition. Before the Government can privatise the industry, they must determine the value of its assets. Correct valuations must, for example, be made for all the reactors that will shut down by the end of the century. If a company is to be floated, it is important to decide whether its assets are worth nothing or a great deal. The Government have placed the private companies under an obligation to build four 1175 MW PWRs. That will be a heavy burden on the industry.
      Mr. McCartney: The hon. Gentleman obviously did not listen to any of the arguments deployed by Labour Members in Committee, when we produced ample evidence of the problems. For example, New York state has had to step in to save a privatised company from bankruptcy. It sold and and then had to buy back the potential nuclear power generating capacity. The nuclear
      784
      companies in France are on the verge of bankruptcy because of crippling costs and the French Government have had to intervene to prevent that. The hon. Gentleman knows that his argument does not hold up. That is why he, more than any Conservative Back Bencher who supports privatisation, has pressed the Government to underwrite the sale of the industry. Without a massive underwriting, not only will there be a shortfall on the expected proceeds from the sale, but in the long term the privatised company will be unable to cope with its social and environmental responsibilities as well as its prime objective of realising the profits that come from privatisation.
      Mr. Eric Illsley: I wish to make only a few brief comments, most of which will relate to the Secretary of State's statement this afternoon and the effect of schedule 12. The right hon. Gentleman said that the Magnox stations will now remain in public ownership, yet schedule 12 increases funding for unforeseeable costs from the interim level of £1 billion to £2·5 billion. That suggests that the funding is being increased for the benefit of fewer power stations. There will be a larger pie for fewer stations.
      Sir Trevor Skeet: There were many fund-raising Bills for the coal industry under the National Coal Board in its time. Each time it exhausted the upper limit, it was extended through a new Bill. I am sure that no one would suggest that schedule 12 will last for ever. Perhaps another £500 million will be required and the Secretary of State will have to come back to the House with a new Bill. That is in line with coal industry legislation.
      Mr. Illsley: The hon. Gentleman merely reinforces the point that we made in Committee, that decommissioning costs were unforeseeable and the Government would have to come to the House time and again to obtain more money for the nuclear industry. Cost comparisons including decommissioning all show that coal-fired stations are more economic than nuclear-powered stations. The Electricity Bill has not yet completed all its stages, yet already the Secretary of State intends to raise the funding for unforeseeable costs from £1 billion to £2·5 billion, even though the Magnox stations have been taken out of the equation. The decommissioning costs are increasing even before privatisation. The Select Committee report in April endorsed our views on BNFI, in which the hon. Gentleman has a particular interest. Its decommissioning costs have increased fivefold because of the change of policy to decommissioning to greenfield sites in three stages over 100 years.
      We must wait until the Bill reaches the statute book in the autumn before the necessary order for further funding is brought before the House and we have an opportunity fully to debate the matter. BNFL's liability for decommissioning costs alone has increased five times over the estimated amount. That begs the question of whether the Government will need to return to Parliament for more money to pay for the decommissioning of the THORP plant, the costings for which already lag well behind the likely actual expense.
      7 pm
      Mr. Donald Dewar: I am obliged to the hon. Member for Bedfordshire, North (Sir T. Skeet) for the thought that the measure that is the subject of this debate might be the equivalent of the groundnuts scheme for the Government. However, there is

      785
      a distinction to be drawn between the two, because I am sure that the hon. Gentleman accepts that the groundnuts scheme was based on idealism and good intentions, and no one can say that the same is true of electricity privatisation. Certainly it cannot be said of the muddle that we have witnessed today.
      I am sorry that, although the Minister of State, Scottish Office, has been courteous enough to await the conclusion of this particular debate, he has chosen not to reply to it. I wanted to ask him one or two questions about the implications of schedule 12 for Scotland, and the Under-Secretary of State for Energy, who is beginning to look like a remarkably solid and permanent object on the shifting scene of the Department of Energy, may not be able to provide the detailed information I want.
      As I flew to London this afternoon, it occurred to me that many important questions remained unanswered because of the total lack of information about nuclear capacity and nuclear costs. However, as a consequence of the past two or three hours, we have almost too much information—most of it confused and disjointed. Nevertheless, only the most churlish right hon. or hon. Member could retreat from remarking that there has been a most interesting series of happenings.
      While I recognise that it is difficult to get the attention of any even junior Ministers on this day of all days, because there is some nervous tic on the Conservative Benches, I may tell the House that my interest in schedule 12 was triggered by a report last week in the Glasgow Herald that the South of Scotland electricity board's accounts will be delayed for up to six months. I was curious to know whether that was true and, if so, the reasons for the delay. Perhaps we can now guess at some of the reasons, but it will still be useful if the Minister can confirm that the SSEB's accounts have been delayed and that the explanation offered by those who monitor the industry is correct—that the arithmetic of nuclear power has gone so badly wrong for the SSEB that it has been compelled to delay publication of its accounts while it scratches its head about the way of presenting them in a more palatable form to those people who may be tempted to invest in the privatised company.
      That is an extremely plausible scenario. As the Under-Secretary of State may recollect, last year the SSEB reported a £15 million operating profit, but it was suddenly translated into a £70 million loss because of the problems relating to the transfer of Chapelcross and of the sharp rise in BNFL's reprocessing costs. Those circumstances form part of the formidable evidence that the whole privatisation exercise is in appalling and fundamental trouble as a consequence of the escalating costs of Britain's nuclear capacity.
      I confess that I am greatly irritated by the way that Ministers blandly deny even the existence of such troubles and there is hardly a ripple across their calm pond of ideology, when anybody who takes the slightest interest knows that there is a ferment of anxiety behind the scenes. It may even have reached the notice of the Energy Minister that in December 1988 the chairman of the South of Scotland electricity board, briefing the press at Torness, remarked that if the Government pursued their original plans, the privatised company would be unsellable. He asked for "absolute insurance" against the ever-escalating
      786
      costs of reprocessing and the way in which he could apparently be held to ransom by BNFL and by the substantial costs of decommissioning, which are also constantly rising.
      SSEB's chairman said at that briefing—I recall raising this point again and again with the Scottish Office—that the assurances
      "will have to be signed and sealed before one writes a prospectus—otherwise it will not be worth writing."
      Clearly he felt very strongly about that matter. Subsequently, I and other right hon. and hon. Members pressed for details of the Government's intentions. There were tales in the press about secret deals and guarantees, but perish the thought, we were told it was a horrible idea that such things should be happening in smoke-filled rooms. In fact, I am sure that those rooms had very good air conditioning. We were told that nothing was happening, but now we know that a deal was hammered out, and that in essence it is an extremely bad deal for the taxpayer.
      The Secretary of State for Energy—as he then was, and may still be—suggested that the Labour party was not in touch with reality and had failed to catch up with the developments with which he was dealing so bravely and effectively. However, when I raised various matters in December 1988, I received a reply from the Secretary of State for Scotland, who is ever-courteous in responding to queries, in which he wrote:
      "I fully recognise Mr. Miller's concerns, but I am confident that there will be a range of instruments to meet them in a manner which both meets legitimate investor concerns and safeguards the position of consumers. There are no grounds for suggesting that the successful privatisation of the industry will be jeopardised by risks associated with the nuclear operating costs."
      A few months later, the Secretary of State for Energy stumbles to the Dispatch Box and concedes that there was every reason for concern, and that a major capitulation by the Government is required in respect of nuclear costs.
      I still want the Under-Secretary of State for Energy to explain more about the Government's intentions. I realise that there will be detailed statements and a debate later, which I welcome. However, as the hon. Member for Bedfordshire, North fairly pointed out, we are faced with a patchwork quilt of responsibilities, consisting not only of the English distribution companies but of two generating companies, one of which will have nuclear interests, and in Scotland a nuclear company wholly owned by the two successor companies to the present boards. There will be a Scottish Nuclear Company, and there is the possibility—I put it no higher—of some continuing state nuclear capacity, which will mesh into that network in a way that is, as yet, obscure.
      I accept entirely that the details have yet to be worked out, because the Government have not worked out the details of any of their actions. They never seem to be worked out, and the Government consequently shift and change their position. The Minister must surely be able to give an overview of how the network will work and describe in the broadest terms what kind of holding company, public institution, quasi-quango, state board or corporation will be created to look after the residue of Britain's nuclear capacity that is the surviving Magnox stations—and state who in Scotland will spend the £400 million or £500 million that will, according to latest estimates, be required for decommissioning Hunterston.

      787
      I take the point made by the hon. Member for Banff and Buchan (Mr. Salmond), quoting my hon. Friend the Member for Pontefract and Castleford (Mr. Lofthouse), that it is difficult to quantify decommissioning costs. My impression is that it is possible to make some estimate at a given point in time, but the trouble is that, over a long time, costs escalate in an alarming and extraordinary fashion.
      I have an article from Power in Europe, a newsletter which carries some authority in the industry, showing the Central Electricity Generating Board's quantifications of decommissioning costs between 1986 and 1989 for a Magnox station. They vary from £211 million up to £641 million, depending on which of those years one picks, and the time scale between stages 2 and 3. This shows the variants and the unknown factors that we are being asked to face.
      We want to know a great deal more about this, and about the circumstances in which money will be paid out under schedule 12. We now know that the upper limit of £2·5 billion is at stake. That is a substantial sum of money. It looks as though the taxpayer is being asked to take over the difficult fag end of the nuclear industry—the older Magnox stations—and pay the bills as a sacrifice to allow the new privatised industry to be launched with reasonable prospects.
      It seems to me that there has been not just a touch of muddle, but a scandalous willingness to prop up a crumbling and tumbling scheme, almost irrespective of the cost.
      Sir Trevor Skeet rose—
      Mr. Dewar: I shall not give way. I am anxious to make a couple more points before I sit down.
      My worry is not with the City, or the financiers—I have some respect for the people who might invest in this company—but with the people who will get forms through the door, because they are South of Scotland electricity board customers, telling them that they will have a wonderful discount if they buy SSEB shares. I think that that is worrying. I am sure it must worry the Under-Secretary as well, if his senior colleague is right, and the Government have had to ride to the rescue because the electricity industry has not faced up to the true costs of decommissioning and reprocessing over the years, but must do so in future. I understand from that that the Minister expects those costs to be met partly out of schedule 12 funds, but substantially out of some reserve, some unidentifiable fund, to be built up over the years. It will face the formidable costs of decommissioning and reprocessing the AGRs in Scotland, which is bound to occur one or two decades after privatisation. I hope that the Minister will comment on that.
      If we are to face the so-called true costs in the future, it is clear that there will almost certainly be a substantial increase in the price of electricity to the consumer. That is an inescapable conclusion from the statement we have heard today, and from the muddle and confusion that has emerged.
      An article in The Daily Telegraph on 21 July said that there might be a 15 to 20 per cent. rise in electricity costs as a result of privatisation. The logic of what has been unveiled today makes that a real problem. It will be a problem for small shareholders and for the consumer. I do not think that the Government are out of the wood yet.
      788
      If the Minister sells these shares on the basis of the prospectus to people who are unlikely to have independent financial advice—people who get offers through the door with discount forms, who see the gloss and the glitz of the television advertising every day in their front rooms—to judge from the arithmetic and prospects that emerge from today's confusion, that would be the height of social and, I suspect, fiscal irresponsibility. The one thing that emerges from all this, with great clarity, is that the old story that I have been given year in, year out by the industry—that the best commercial basis on which to produce electricity is nuclear—has been blown out of the water. The truth is now out.
      7.15 pm
      Paragraph 78 of the Energy Select Committee's sixth report, on the greenhouse effect, says:
      "Most strikingly, when questioned about the economics of nuclear power and the impending privatisation of the electricity supply industry in Great Britain, the Chairman of the UKAEA said that he did 'not believe that in the present situation or climate privatised electricity generating companies would invest in nuclear power, to be absolutely frank'."
      That we have again had to bail out a privatisation with the cynical use of taxpayers' resources does not hide the fact that the problems of nuclear power will haunt many of the Scottish boards, or rather the combined generating and distributing companies. I suspect, as the years go by, that exactly the same problems that have haunted the SSEB over the past few years will haunt the new companies and their shareholders and, given the Government's approach, the people who will pay the price, formally and unfairly, will be the customers who buy the electricity.
      Mr. Michael Spicer: I hope that the House will agree to the Lords amendments that we are discussing and oppose the Opposition motions because, as I said in my opening speech, I do not think that it is sensible to put a time limit on these agreements.
      Mr. Morgan: The Government want a bottomless pit.
      Mr. Spicer: The hon. Member says that we want a bottomless pit. That is precisely what is not implied in this group of amendments, in clause 93 and in schedule 12. A precise figure is attached to them, as he knows, because his knowledge of the subject is detailed. The figure is £2·5 billion. I remind the House that, for the figure to be raised from £1 billion to £2·5 billion, there will have to be an affirmative resolution. I want to underline what my right hon. Friend the Secretary of State said about that—the affirmative resolution will be debatable. Therefore, far from being open ended, as the hon. Member for Cardiff, West (Mr. Morgan) said, it is the reverse. It is specific as to what sums of money are involved.
      I assure the House that these amendments do not make any difference, in substance, to the purpose of clause 93 and to schedule 12. That is common ground in the House, I would have thought. It has been made clear to us when writing the prospectus for privatisation that the additional net, if it can be called that, should be introduced into the Bill so that there is no doubt about the Government's intention to apply the terms of clause 93 and schedule 12. It underscores and underlines the Bill as it stands.
      I understand, after today's statement, that the Opposition want to peg further questions and debates. II do not quarrel with that, but this is purely a technical matter, underlining clause 93 and schedule 12.
      Sir Trevor Skeet: Schedule 12 is there because certain costs cannot be evaluated because of the lengthy period over which they will mature. Decommissioning takes more than 100 years, so it is impossible to be precise, and, if one cannot be precise, one has to have this schedule to be able to deal with it. Is that not true?
      Mr. Spicer: I am grateful to my hon. Friend for making an important point which leads me to what I wanted to say in any case. The purpose of clause 93 remains exactly the same in relation to the new private companies. No doubt there will be unforeseen and indeed uncontrollable costs, but the powers under the clause will allow them to be met. The problem of the time scale would exist whether or not the industry was privatised, and regardless of today's statement; power stations of this kind have not been decommissioned before. The powers in the Bill clearly make sense, and the amendments simply underscore them.
      The hon. Member for Gordon (Mr. Bruce), and a number of others, have thrown around the figure of £8 billion. I do not know where they got that figure; perhaps they will let us into the secret, and help us to make our dispositions even firmer. One of the reasons why we have no firm figure as yet was implied by the hon. Member for Glasgow, Garscadden (Mr. Dewar) when he asked me about the effect of Chapelcross on the profitability of the SSEB last year. Let me remind the hon. Gentleman that, contrary to the impression that he gave, Mr. Donald Miller has always been very enthusiastic about the sale—or so all his public statements have implied.
      The hon. Gentleman's main question concerned the relationship between BNFL and the SSEB in the context of delayed accounts. I concede that negotiations between BNFL and the entire United Kingdom electricity industry on reprocessing are still in progress. Until the contracts are completed we cannot foresee the costs, as my hon. Friend the Member for Bedfordshire, North (Sir T. Skeet) has pointed out.
      Sir Trevor Skeet: I am not sure that the Opposition have worked this out properly. A different company from BNFL will probably be dealing with the Magnox reactors. I am assuming, on the basis of the schedule, that the additional costs of some of the reactors will come out of the £2·5 billion. If that can be clarified, we shall have made some progress.
      Mr. Spicer: I was coming to that point. As I have said, the companies left in the private sector will be subject to the criterion that we have already laid down, and about which I was questioned by the hon. Member for Sedgefield (Mr. Blair). My hon. Friend was wise and percipient to ask about the Magnox reactors: the powers in clause 93 could be applied to Magnox costs, should cashflow problems require it. We are not sure whether that will happen, as they will be earning revenue in the public sector as well as creating costs. My hon. Friend has made an important contribution by enabling that to be put clearly on the record.
      There is nothing untoward about the Lords amendments, and I hope that the Opposition will not press them to a vote. It would certainly be extraordinary of them to press their amendment to a vote. They may not like our general policy; they may be concerned about the statement; they may have all sorts of worries. The problems, however, are long-term problems and have not
      790
      occurred before. Any policy involving "capping" or "time-limiting" the agreements would, I feel, be wrongheaded.
      Mr. Salmond: I hope that the Minister was not intending to finish his speech without answering a question that I have already asked twice today. Given that decommissioning costs have been discounted over long periods, who will pick up the tab if a private company goes out of business before the costs need to be met?
      Mr. Spicer: That is very unlikely, for a number of reasons. One of those reasons is that the regulator will be able to determine the prices that the industry will require to cover its costs. At the back of our minds has always been the need to make proper provision over a period of time, difficult though that is. That will incur costs, which the regulator will no doubt take into account when constructing his price formula. There will be no problem; that is the reason for the regulator's existence.
      Given the regulation of the industry, the non-fossil fuel obligation and other protections for the industry which the Opposition have questioned, I do not feel that the hon. Gentleman's fears are well founded. I hope that the Opposition will feel able to withdraw their amendment and that the House will accept the Lords amendment.
      Question put, That this House doth agree with the Lords in the said amendment:—
      The House divided: Ayes 312, Noes 195.

      Division No. 317]

      [7.27 pm

      AYES

      Adley, Robert

      Budgen, Nicholas

      Aitken, Jonathan

      Burns, Simon

      Alexander, Richard

      Burt, Alistair

      Alison, Rt Hon Michael

      Butler, Chris

      Allason, Rupert

      Butterfill, John

      Amess, David

      Carlisle, John, (Luton N)

      Amos, Alan

      Carlisle, Kenneth (Lincoln)

      Arbuthnot, James

      Carrington, Matthew

      Arnold, Jacques (Gravesham)

      Carttiss, Michael

      Arnold, Tom (Hazel Grove)

      Cash, William

      Ashby, David

      Chapman, Sydney

      Atkins, Robert

      Chope, Christopher

      Atkinson, David

      Churchill, Mr

      Baker, Nicholas (Dorset N)

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

      Baldry, Tony

      Clark, Dr Michael (Rochford)

      Banks, Robert (Harrogate)

      Clarke, Rt Hon K. (Rushcliffe)

      Batiste, Spencer

      Conway, Derek

      Beaumont-Dark, Anthony

      Coombs, Anthony (Wyre F'rest)

      Bellingham, Henry

      Coombs, Simon (Swindon)

      Bennett, Nicholas (Pembroke)

      Cope, Rt Hon John

      Benyon, W.

      Cormack, Patrick

      Bevan, David Gilroy

      Couchman, James

      Biften, Rt Hon John

      Cran, James

      Blackburn, Dr John G.

      Curry, David

      Blaker, Rt Hon Sir Peter

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

      Bonsor, Sir Nicholas

      Davis, David (Boothferry)

      Boscawen, Hon Robert

      Day, Stephen

      Boswell, Tim

      Devlin, Tim

      Bottomley, Mrs Virginia

      Douglas-Hamilton, Lord James

      Bowden, A (Brighton K'pto'n)

      Dover, Den

      Bowden, Gerald (Dulwich)

      Dunn, Bob

      Bowis, John

      Durant, Tony

      Boyson, Rt Hon Dr Sir Rhodes

      Dykes, Hugh

      Braine, Rt Hon Sir Bernard

      Evans, David (Welwyn Hatf'd)

      Brandon-Bravo, Martin

      Fairbairn, Sir Nicholas

      Brazier, Julian

      Fallon, Michael

      Bright, Graham

      Favell, Tony

      Brooke, Rt Hon Peter

      Fenner, Dame Peggy

      Brown, Michael (Brigg & Cl't's)

      Field, Barry (Isle of Wight)

      Browne, John (Winchester)

      Fishburn, John Dudley

      Bruce, Ian (Dorset South)

      Fookes, Dame Janet

      Buck, Sir Antony

      Forman, Nigel

      791

      Forsyth, Michael (Stirling)

      Lester, Jim (Broxtowe)

      Forth, Eric

      Lightbown, David

      Fowler, Rt Hon Norman

      Lilley, Peter

      Fox, Sir Marcus

      Lloyd, Sir Ian (Havant)

      Franks, Cecil

      Lloyd, Peter (Fareham)

      Freeman, Roger

      Lord, Michael

      French, Douglas

      Luce, Rt Hon Richard

      Gale, Roger

      Lyell, Sir Nicholas

      Garel-Jones, Tristan

      McCrindle, Robert

      Gill, Christopher

      MacKay, Andrew (E Berkshire)

      Glyn, Dr Alan

      McLoughlin, Patrick

      Goodhart, Sir Philip

      McNair-Wilson, Sir Michael

      Goodlad, Alastair

      McNair-Wilson, Sir Patrick

      Goodson-Wickes, Dr Charles

      Madel, David

      Gorman, Mrs Teresa

      Malins, Humfrey

      Gorst, John

      Maples, John

      Gow, Ian

      Marlow, Tony

      Grant, Sir Anthony (CambsSW)

      Marshall, John (Hendon S)

      Greenway, Harry (Eating N)

      Marshall, Michael (Arundel)

      Greenway, John (Ryedale)

      Martin, David (Portsmouth S)

      Gregory, Conal

      Mates, Michael

      Griffiths, Sir Eldon (Bury St E')

      Maude, Hon Francis

      Griffiths, Peter (Portsmouth N)

      Mawhinney, Dr Brian

      Ground, Patrick

      Maxwell-Hyslop, Robin

      Gummer, Rt Hon John Selwyn

      Mayhew, Rt Hon Sir Patrick

      Hague, William

      Meyer, Sir Anthony

      Hamilton, Neil (Tatton)

      Miller, Sir Hal

      Hampson, Dr Keith

      Mills, Iain

      Hanley, Jeremy

      Miscampbell, Norman

      Hannam, John

      Mitchell, Andrew (Gedling)

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

      Mitchell, Sir David

      Hargreaves, Ken (Hyndburn)

      Moate, Roger

      Harris, David

      Monro, Sir Hector

      Haselhurst, Alan

      Montgomery, Sir Fergus

      Hayes, Jerry

      Moore, Rt Hon John

      Hayhoe, Rt Hon Sir Barney

      Morris, M (N'hampton S)

      Heathcoat-Amory, David

      Morrison, Sir Charles

      Heddle, John

      Morrison, Rt Hon P (Chester)

      Hicks, Mrs Maureen (Wolv' NE)

      Moss, Malcolm

      Hicks, Robert (Cornwall SE)

      Moynihan, Hon Colin

      Higgins, Rt Hon Terence L.

      Mudd, David

      Hill, James

      Neale, Gerrard

      Hind, Kenneth

      Needham, Richard

      Hogg, Hon Douglas (Gr'th'm)

      Nelson, Anthony

      Holt, Richard

      Newton, Rt Hon Tony

      Hordern, Sir Peter

      Nicholls, Patrick

      Howard, Michael

      Nicholson, David (Taunton)

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

      Nicholson, Emma (Devon West)

      Howarth, G. (Cannock & B'wd)

      Norris, Steve

      Howell. Rt Hon David (G'dford)

      Onslow, Rt Hon Cranley

      Howell, Ralph (North Norfolk)

      Oppenheim, Phillip

      Hughes, Robert G. (Harrow W)

      Page, Richard

      Hunt, David (Wirral W)

      Paice, James

      Hunt, Sir John (Ravensbourne)

      Parkinson, Rt Hon Cecil

      Hunter, Andrew

      Patnick, Irvine

      Hurd, Rt Hon Douglas

      Patten, Rt Hon Chris (Bath)

      Irvine, Michael

      Patten, John (Oxford W)

      Irving, Charles

      Pawsey, James

      Jack, Michael

      Peacock, Mrs Elizabeth

      Jackson, Robert

      Porter, Barry (Wirral S)

      Janman, Tim

      Portillo, Michael

      Jessel, Toby

      Powell, William (Corby)

      Johnson Smith, Sir Geoffrey

      Price, Sir David

      Jones, Gwilym (Cardiff N)

      Raffan, Keith

      Jones, Robert B (Herts W)

      Raison, Rt Hon Timothy

      Jopling, Rt Hon Michael

      Rathbone, Tim

      Kellett-Bowman, Dame Elaine

      Redwood, John

      Key, Robert

      Renton, Tim

      King, Roger (B'ham N'thfield)

      Rhodes James, Robert

      Kirkhope, Timothy

      Riddick, Graham

      Knapman, Roger

      Ridley, Rt Hon Nicholas

      Knight, Greg (Derby North)

      Ridsdale, Sir Julian

      Knight, Dame Jill (Edgbaston)

      Rifkind, Rt Hon Malcolm

      Knowles, Michael

      Roe, Mrs Marion

      Lamont, Rt Hon Norman

      Rossi, Sir Hugh

      Lang, Ian

      Rost, Peter

      Latham, Michael

      Rowe, Andrew

      Lawrence, Ivan

      Rumbold, Mrs Angela

      Lee, John (Pendle)

      Sackville, Hon Tom

      Lennox-Boyd, Hon Mark

      Sayeed, Jonathan

      792

      Scott, Rt Hon Nicholas

      Thurnham, Peter

      Shaw, David (Dover)

      Townend, John (Bridlington)

      Shaw, Sir Giles (Pudsey)

      Townsend, Cyril D. (B'heath)

      Shaw, Sir Michael (Scarb')

      Tracey, Richard

      Shephard, Mrs G. (Norfolk SW)

      Tredinnick, David

      Shepherd, Colin (Hereford)

      Trippier, David

      Shersby, Michael

      Trotter, Neville

      Skeet, Sir Trevor

      Twinn, Dr Ian

      Smith, Sir Dudley (Warwick)

      Vaughan, Sir Gerard

      Smith, Tim (Beaconsfield)

      Waddington, Rt Hon David

      Soames, Hon Nicholas

      Wakeham, Rt Hon John

      Speed, Keith

      Waldegrave, Hon William

      Speller, Tony

      Walden, George

      Spicer, Sir Jim (Dorset W)

      Walker, Bill (T'side North)

      Spicer, Michael (S Worcs)

      Waller, Gary

      Squire, Robin

      Walters, Sir Dennis

      Stanbrook, Ivor

      Ward, John

      Stanley, Rt Hon Sir John

      Wardle, Charles (Bexhill)

      Stern, Michael

      Warren, Kenneth

      Stevens, Lewis

      Wells, Bowen

      Stewart, Allan (Eastwood)

      Wheeler, John

      Stewart, Andy (Sherwood)

      Whitney, Ray

      Stewart, Rt Hon Ian (Herts N)

      Widdecombe, Ann

      Stokes, Sir John

      Wiggin, Jerry

      Sumberg, David

      Wilkinson, John

      Summerson, Hugo

      Winterton, Mrs Ann

      Tapsell, Sir Peter

      Winterton, Nicholas

      Taylor, Ian (Esher)

      Wolfson, Mark

      Taylor, John M (Solihull)

      Wood, Timothy

      Taylor, Teddy (S'end E)

      Woodcock, Dr. Mike

      Tebbit, Rt Hon Norman

      Yeo, Tim

      Temple-Morris, Peter

      Young, Sir George (Acton)

      Thompson, D. (Calder Valley)

      Thompson, Patrick (Norwich N)

      Tellers for the Ayes:

      Thorne, Neil

      Mr. David Maclean and Mr. Stephen Dorrell

      Thornton, Malcolm

      NOES

      Abbott, Ms Diane

      Coleman, Donald

      Adams, Allen (Paisley N)

      Cook, Frank (Stockton N)

      Allen, Graham

      Cook, Robin (Livingston)

      Alton, David

      Corbett, Robin

      Anderson, Donald

      Corbyn, Jeremy

      Archer, Rt Hon Peter

      Cousins, Jim

      Armstrong, Hilary

      Cryer, Bob

      Ashdown, Rt Hon Paddy

      Cummings, John

      Ashley, Rt Hon Jack

      Cunliffe, Lawrence

      Ashton, Joe

      Cunningham, Dr John

      Banks, Tony (Newham NW)

      Darling, Alistair

      Barnes, Harry (Derbyshire NE)

      Davies, Rt Hon Denzil (Llanelli)

      Barnes, Mrs Rosie (Greenwich)

      Davies, Ron (Caerphilly)

      Barron, Kevin

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

      Battle, John

      Dewar, Donald

      Beckett, Margaret

      Dixon, Don

      Beith, A. J.

      Dobson, Frank

      Benn, Rt Hon Tony

      Doran, Frank

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

      Duffy, A. E. P.

      Bermingham, Gerald

      Dunwoody, Hon Mrs Gwyneth

      Bidwell, Sydney

      Eadie, Alexander

      Blair, Tony

      Eastham, Ken

      Boateng, Paul

      Ewing, Harry (Falkirk E)

      Boyes, Roland

      Ewing, Mrs Margaret (Moray)

      Bradley, Keith

      Fatchett, Derek

      Bray, Dr Jeremy

      Fearn, Ronald

      Brown, Nicholas (Newcastle E)

      Fisher, Mark

      Bruce, Malcolm (Gordon)

      Flannery, Martin

      Buckley, George J.

      Flynn, Paul

      Caborn, Richard

      Foster, Derek

      Callaghan, Jim

      Fraser, John

      Campbell, Menzies (Fife NE)

      Galloway, George

      Campbell, Ron (Blyth Valley)

      Garrett, John (Norwich South)

      Campbell-Savours, D. N.

      Garrett, Ted (Wallsend)

      Canavan, Dennis

      Gilbert, Rt Hon Dr John

      Cartwright, John

      Godman, Dr Norman A.

      Clark, Dr David (S Shields)

      Golding, Mrs Llin

      Clarke, Tom (Monklands W)

      Gordon, Mildred

      Clay, Bob

      Gould, Bryan

      Clelland, David

      Graham, Thomas

      Clwyd, Mrs Ann

      Grant, Bernie (Tottenham)

      Cohen, Harry

      Griffiths, Nigel (Edinburgh S)

      793

      Griffiths, Win (Bridgend)

      Orme, Rt Hon Stanley

      Grocott, Bruce

      Patchett, Terry

      Hardy, Peter

      Pendry, Tom

      Hattersley, Rt Hon Roy

      Pike, Peter L.

      Haynes, Frank

      Primarolo, Dawn

      Healey, Rt Hon Denis

      Quin, Ms Joyce

      Henderson, Doug

      Radice, Giles

      Hinchliffe, David

      Randall, Stuart

      Hoey, Ms Kate (Vauxhall)

      Redmond, Martin

      Hogg, N. (C'nauld & Kilsyth)

      Rees, Rt Hon Merlyn

      Home Robertson, John

      Richardson, Jo

      Howarth, George (Knowsley N)

      Roberts, Allan (Bootle)

      Howell, Rt Hon D. (S'heath)

      Robinson, Geoffrey

      Hoyle, Doug

      Rogers, Allan

      Hughes, John (Coventry NE)

      Rooker, Jeff

      Hughes, Robert (Aberdeen N)

      Ross, Ernie (Dundee W)

      Hughes, Roy (Newport E)

      Rowlands, Ted

      Illsley, Eric

      Ruddock, Joan

      Ingram, Adam

      Salmond, Alex

      Janner, Greville

      Sedgemore, Brian

      Johnston, Sir Russell

      Sheldon, Rt Hon Robert

      Jones, Barry (Alyn & Deeside)

      Shore, Rt Hon Peter

      Jones, Martyn (Clwyd S W)

      Short, Clare

      Kennedy, Charles

      Skinner, Dennis

      Kinnock, Rt Hon Neil

      Smith, Andrew (Oxford E)

      Kirkwood, Archy

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

      Lamond, James

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

      Leighton, Ron

      Smith, J. P. (Vale of Glam)

      Lewis, Terry

      Soley, Clive

      Litherland, Robert

      Spearing, Nigel

      Lloyd, Tony (Stretford)

      Steinberg, Gerry

      Lofthouse, Geoffrey

      Stott, Roger

      McAllion, John

      Straw, Jack

      McAvoy, Thomas

      Taylor, Mrs Ann (Dewsbury)

      McCartney, Ian

      Taylor, Matthew (Truro)

      Macdonald, Calum A.

      Thompson, Jack (Wansbeck)

      McKay, Allen (Barnsley West)

      Turner, Dennis

      McKelvey, William

      Vaz, Keith

      McLeish, Henry

      Wall, Pat

      McWilliam, John

      Wallace, James

      Madden, Max

      Walley, Joan

      Mahon, Mrs Alice

      Wardell, Gareth (Gower)

      Marshall, Jim (Leicester S)

      Wareing, Robert N.

      Martin, Michael J. (Springburn)

      Watson, Mike (Glasgow, C)

      Meacher, Michael

      Welsh, Andrew (Angus E)

      Meale, Alan

      Welsh, Michael (Doncaster N)

      Michael, Alun

      Williams, Rt Hon Alan

      Michie, Bill (Sheffield Heeley)

      Williams, Alan W. (Carm'then)

      Mitchell, Austin (G't Grimsby)

      Wilson, Brian

      Morgan, Rhodri

      Winnick, David

      Morris, Rt Hon A. (W'shawe)

      Wise, Mrs Audrey

      Morris, Rt Hon J. (Aberavon)

      Worthington, Tony

      Mowlam, Marjorie

      Young, David (Bolton SE)

      Mullin, Chris

      Murphy, Paul

      Tellers for the Noes:

      Nellist, Dave

      Mr. Jimmy Dunnachie and Mr. Ray Powell.

      Oakes, Rt Hon Gordon

      O'Brien, William

      Question accordingly agreed to.
      Lords amendments Nos. 159 to 162 agreed to. [Special entry.]
      Lords amendment: No. 21, before clause 11, insert the following new clause—Licence conditions for nuclear installations—
      "Where a person authorised to generate electricity under section 6(1)(a) above proposes to do so by means of nuclear fission, it shall be a condition of the licence that the Secretary of State may at any time if he perceives that there is a matter affecting the safety of the public by order requisition and bring under his own control the relevant nuclear installations."
      Mr. Michael Spicer: I beg to move, That this House doth disagree with the Lords in the said amendment.
      Mr. Deputy Speaker (Mr. Harold Walker): With this it will be convenient to take Lords amendments Nos. 81 to 89 and the Government motions to disagree with each.
      Mr. Spicer: I understand, Mr Deputy Speaker, that it may be for the convenience of the House if we take with this group the following Lords amendments: No. 28, in clause 32, page 24, line 42, leave out from "with" to "and" in line 43 and insert
      "the suppliers concerned, by order require each public electricity supplier in England and Wales or each supplier in Scotland, before a day specified in the order, to make (in so far as he has not already done so)"
      Amendment (a) to the Lords amendment, leave out
      'each such supplier in Scotland'.
      Nos. 29 to 35.
      No. 36, in clause 33, page 26, line 21, after "above" insert
      "in relation to public electricity suppliers in England and Wales, or public electricity suppliers in Scotland"
      Amendment (a) to the Lords amendment, leave out
      'or public electricity supplier in Scotland'.
      Amendments Nos. 37 to 50, 78 and 79.
      Mr. Deputy Speaker: Is that the wish of the House? That being so, the Minister may proceed.
      Mr. Spicer: Amendments Nos. 28 to 79, dealing with the non-fossil fuel obligation and associated levy, are technical amendments. If any hon. Member has questions, I shall be happy to answer them, but if not, I shall leave the amendments to one side.
      The first group of amendments deals with safety and seeks to provide that when a nuclear power station is defined as unsafe, its ownership and control should fall back into the hands of the Secretary of State. The main reason why the Government disagree with that is simple. Under the Nuclear Installations Act 1965, the nuclear installations inspectorate has powers to shut down nuclear power stations or to modify their licences. Indeed, should there be any question of their being unsafe, it has virtually unlimited powers over power stations and their operators. The obligation for safety placed on the operators within the general restrictions and safety conditions laid down by the inspectorate has served the country well, so the amendment is not necessary.
      I do not want to make a debating point, but the Opposition are trying to suggest that we should take safety for North sea oil operations out of the hands of the Secretary of State whereas the other place at least supports the view that safety at nuclear installations should be in the hands of the Secretary of State. It will be interesting to see whether the Opposition can solve that conundrum.
      Both sides of the House agree that the present legislation is tight on safety. The Bill further strengthens the safety provisions relating to the regulator. We have had a debate on that subject and the Government have brought forward amendments to that effect. We agree about the paramountcy and importance of safety, but the Bill provides a regime to ensure that safety provisions will be complied with.
      7.45 pm
      Mr. Morgan: We are in something akin to uncharted waters this evening, in more ways than one. First, we seem to be operating in a Minister-free zone. I have some sympathy for the departing Secretary of State and his Under-Secretary of State, who were near to ascending their own parliamentary Everest. Just before they reached the summit, the Secretary of State, at least, seems to have slid back to South Col on his backside. Since then, he seems to have found a convenient bus operating from

      795
      South Col back to Katmandu. His future parliamentary survival may depend on him seeing what he can do to live down the consequences of his announcement earlier today that Magnox stations would be left out of the Bill at the last minute of its parliamentary consideration.
      There is a further reason why we are in uncharted waters. The Secretary of State told the House at 4.30 pm that Magnox stations should be taken out of the privatisation process and brought back into the public sector, because that was the only way to protect potential investors. Now the Minister is telling the House, at 7.50 pm, that for reasons of public safety he is not willing to consider bringing nuclear power stations back into the public sector. He is willing to strengthen protection for private investors, but he wants to weaken protection for public safety. That is an extraordinary contradiction. It may even he the ultimate statement of what the Government are about. They do not care as much about public safety as they do about the safety of the privatisation process, and the advice that they receive from merchant banks on the electricity industry ranks higher than any other.
      Lords amendment No. 21 makes it clear that, should there be any doubts about the public safety of nuclear power stations, the Secretary of State would have the right to draw them back into the public sector, if they had already been privatised. I assume that that is confined to AGRs and PWRs. Even after today's announcement, we have no details about that and there could still be an element of privatisation. For that reason, I shall speak as though Magnox stations could be privatised on a sale-and-leaseback procedure. That has by no means been excluded by the Secretary of State's extraordinarily vague announcement. That is another reason why we are in uncharted waters.
      It is all very well for the Minister to tell the House, as he did two minutes ago, that we have well-established procedures for dealing with safety issues on the nuclear side of the electricity generating industry. No one has more regard for the inspectors and employees of the nuclear installations inspectorate than the Opposition Front Bench. We hold Eddie Ryder and his staff in the highest regard, but several relatively new factors tend to undermine one's confidence in the bland assurances given by the Under-Secretary of State a couple of moments ago.
      We know from the nuclear installations inspectorate itself that it is seriously under-staffed. It would like a very much larger complement because it will have to deal with a much wider range of problems in future. It will be dealing with three separate nuclear installations technologies—Magnox, AGRs and, before long, PWRs—which it has never had to do before. It will also be dealing with a whole new ball game because of the number of stations being decommissioned. It looks as though the inspectorate may even have to deal with three separate companies, although that is not necessarily so. Clearly, it will have to deal with the nuclear divisions of National Power and the SSEB and it now seems possible that we shall have some sort of cross-border dog's dinner of a nuclear company to deal with Magnox in its declining years until Wylfa is decommissioned in 2001 or 2002, so the NII may be having to deal with three separate management teams.
      The Minister argues that there is no need to worry because we have the NII, whose terms of reference are clear—that the NII licences the operators and the types
      796
      and that that means that we in Britain have a much better system than other countries and that no problems can arise. As I said, no one could have more regard than the Opposition for the staff of the NII and their dedication to their duties, but the fact remains that they will be facing new problems.
      Take the decommissioning of the Magnox stations. The staff of the NII take the view that with the present complement the inspectorate will have its hands full simply dealing with the annual reports for the Magnox statio:ns. It will be almost a full-time job. In addition, the NII will have to consider for the first time the licensing of the operating side of PWRs when the construction phase of Sizewell B is eventually completed in about 1992. In the light of those new problems, the Minister's bland assurances are inadequate.
      When the Magnox stations are running down, a whole new series of safety problems will arise. Let me give this idea to the Minister to chew over in case his mind is turning to other matters—such as whether he will be here tomorrow. As Magnox stations fall in temperature, they produce weapons-grade plutonium, rather than civil-grade plutonium. A whole new series of protective measures may be required to cover that accidental by-product of the running down of Magnox stations. The nuclear installations inspectorate and other international inspectorates may well take a great deal of interest in that unintended side effect.
      In terms of public safety questions such as terrorist attack or theft of plutonium stocks, the decommissioning of Magnox will give rise to a whole new series of questions. We have never had to deal with such questions before because we have never decommissioned stations before, whereas now a whole series of Magnox stations are to go out of business over the next 13 years, until the Magnox problem is behind us.
      For those reasons Opposition Members have a great deal of sympathy with the Lords amendments. The Government may say, "We have solved that problem ourselves by taking the Magnox stations out of the privatisation process and keeping them in the public sector. And if they are in the public sector already we do not need the power to take them out of the private sector." We need an assurance from the Minister that the Magnox stations will not enter the private sector by way of sale-and-leaseback arrangements because the Secretary of State was extremely vague on this issue in his statement earlier today. He gave us no idea what form the company would take—perhaps another Secretary of State will have to handle that particular hot potato—and until we know that, we must assume that there is a possibility that the privatised nuclear power industry will include at least the management of the Magnox stations. In that case the provisions of Lords amendment No. 21 would need to apply to Magnox stations as well as to AGRs and PWRs.
      Even if we assume that the Magnox stations stay in the hands of a state nuclear corporation—being incorporated with BNFL, being placed in the hands of a separate Crown nuclear company or remaining in legislative limbo—we must still ask whether the state should have the right to reacquire ownership of AGRs if a public safety threat such as a military, terrorist or type-fault threat arose. Given all the criticisms that have been made about AGRs, that possibility cannot be excluded. Should the Government have an easy route to reacquire the stations on public

      797
      safety grounds or should we have to go through the whole dreary process of introducing legislation to transfer the industry from private to public?
      We have much sympathy with the Lords amendment because we believe that the Lords took a long-term view. The public have a great many doubts about how they will live with the nuclear industry. For example, we know that one could never build a nuclear power station on a green field site in this country following the public inquiry process. One can build new nuclear power stations where there are already nuclear power stations because there is a nuclear vested interest in those areas. But if the public had known in the late 1950s and early 1960s what they now know about nuclear power, the existing sites would never have been set up, and that vested interest would never have arisen.
      The Lords have sought to reflect the fact that, given the choice, no one would allow a nuclear power station to be built in his area. The public do not want to live in close proximity to nuclear power stations. That is also true in other countries, the possible exception being France.
      The public would undoubtedly be greatly reassured if the Government embraced the spirit of the Lords amendment and said, "We understand how you feel about nuclear power and how you were conned into accepting nuclear back in the late 1950s," acknowledging that nuclear power was our weapon to defend ourselves against being exploited by high oil prices and that to be able to construct nuclear power stations was the macho symbol of technologically advanced civilisations. All those assumptions proved hopelessly inaccurate, but they were sufficient to persuade the public to accept nuclear power stations.
      The Government must think seriously about how to reassure the public that in a privatised electricity industry public safety will be given the highest priority. We know that once the industry is privatised we shall have a jungle out there. We know that the public believe that in the jungle of a privatised industry corners will be cut. The Minister asked earlier where the estimate of £8 billion for decommissioning Magnox stations came from. I recall that Phillips and Drew the stockbrokers, who are under something of a cloud at present in relation to an entirely different matter, suggested that the possible cost would be £12 billion. That firm was assisting the Government in preparing reasonable estimates of the real cost of nuclear power and said that the decommissioning of Magnox would cost £4 billion if it were done over a century but that that could rise to £12 billion if it were done at the most rapid practicable rate—the rate at which the Swedish Government have told their industry to decommission.
      The British Government may wish to choose a similar regime. The public might want them to make that choice rather than having huge concrete domes all over the countryside. The public suspect that in a privatised nuclear industry management will say, "We cannot possibly afford that; we cannot do it; we shall go bust if you force us to do it." What is the answer to that?
      The public are crying out for reassurance about the safety of living next door to sources of radiation while the interests of investors and shareholders are pulling the other way. We want to know which way the Government will go. The public would like to see the spirit of Lords amendment No. 2 incorporated in the Bill.
      798
      The prime purpose of the Bill must be to reassure the public. Whatever the ideologies of hon. Members, the operation of the industry must be safe and electricity supply must be secure. The Bill's prime purpose cannot be simply to give potential investors a risk-free ride when they have a punt on the pylons and power stations.
      In that spirit of asking the Government to reassure the public about the safety of nuclear power stations, I ask them to think again and move to the spirit of Lords amendment No. 21.
      8 pm
      Mr. Malcolm Bruce: I support the general thrust of the comments of the hon. Member for Cardiff, West (Mr. Morgan). There are currently so many question marks over nuclear power that it should not move out of the public sector. It certainly should not move from the public sector when its monitoring, safety and emergency provisions have been exposed as underdeveloped. In Committee, we touched on such matters and gave examples to reinforce our argument.
      The general attitude to the level of acceptability of radiation doses has changed dramatically over the years. We have moved from a feeling that any radiation was likely to be damaging, through a belief that quite high doses could be tolerated, to the current belief that we cannot accept the present dosages. The industry is about to be privatised when a public debate is going on about whether the acceptable levels of exposure to radiation are low enough.
      In the 1950s, the dose limit for workers in the industry was set at 150 mSv, but it was reduced to 50 mSv in 1977, the last time that there was a specific change. The National Radiological Protection Board believes that much lower levels should operate, and has suggested 0·5 or 0·2 mSv. Seven per cent. of employees at Sellafield have received doses of almost 50 mSv. People involved in decommissioning and reprocessing are particularly vulnerable to high doses. If the processes of reprocessing or decommissioning make it impossible for humans to do them because safety levels have fallen below what is acceptable, what will that mean for reprocessing, decommissioning or the private sector nuclear industry? The amendment at least ensures that the Government have at their disposal, at any time, the right to intervene and to say, "We are not satisfied that sufficiently high standards are being applied, so we propose to take direct responsibility."
      In Committee, I referred to emergency evacuation procedures for nuclear power stations. It is little short of a scandal that we still have no published, workable or known evacuation procedures for people within the vicinity of nuclear power stations, despite many requests for one by the Association of Planning Officers. Information is not available to local general practitioners about the effect of discharge of radiation on workers or people in the vicinity of a nuclear power station, although they have tried to secure such information several times.
      The industry is being privatised, despite the fact that we know that major accidents can happen, and have happened. We have a moving position on safety and the possibility that, in an emergency, responsible local authorities and the public within the vicinity of a nuclear power station would not know what was expected of them. That example determines that the amendment is necessary to ensure that safety factors are taken into account.

      799
      The House should not allow the Government to be complacent about this industry, of all industries. It is a regrettable fact that the commercial climate created by the Government of the maximisation of profit and the allowance of commercial interests with the maximum deregulation has already led to major disasters in the private sector. I do not need to catalogue them, because we are all aware of them and because they have been referred to all too often in debates.
      Do the Government want to put alongside Zeebrugge, Clapham or Lockerbie a Hinkley Point or a Dungeness B because they chose to privatise the industry with inadequate safeguards? I believe that that is what they are proposing. I believe that that is what their Lordships thought, and that is the reason for the amendment. It is regrettable that the Government do not appear to have learnt from the savage incidents that have occurred. The consequences for the nuclear power industry of the pursuit of profit and the compromise of safety standards that might occur as a result would be more far-reaching than the other disasters to which I have referred.
      I should like to question the implications of the non-fossil fuel levy for Scotland, which is why by I tabled two probing amendments. Scotland has substantial overcapacity in all electrical power generation, predominantly because of excessive investment in nuclear power stations. I suggested in Committee that, to reduce that over-capacity, the ownership of Torness should be transferred to National Power, thereby releasing some of the excess capacity in Scotland. That is not an ideal solution, because Torness should never have been built, but given that it exists and is operating, and given that under the Bill nuclear capacity is to be contracted to a percentage under the non-fossil fuel levy, it appears that it could make a contribution.
      I ask the Minister to say whether the Government have any thoughts on when and if the non-fossil fuel levy will be applied to Scotland. It has been suggested that eventually it might, but will a different level apply? Perhaps more pertinent, it is important to impress on the Minister that the way in which nuclear power capacity is being forced on the industry is continuing to depress and prejudice the interests of alternative non-fossil fuel sources of electricity.
      Will the Minister comment on reports that have appeared in the press over the past few days that the French believe they can meet the target that the Government have set of 600 MW of alternative non-fossil fuel sources from their hydro facilities? Understandably, the Government share my suspicions that that would be a way of offloading their extra nuclear capacity. When one switches on a light, it is difficult to know what system of generation has produced the power that results. This is an important issue and the Government could have set themselves a much higher standard than their 600 MW objective.
      It remains a matter of concern to me—I repeat it only at its face value—that Scotland probably has the best potential of any part of the United Kingdom for developing substantial renewable energy. That is in no way to underplay what can be achieved in other parts of the United Kingdom, but, according to independent studies, our wind profile is better than that of Denmark and we therefore have the potential to secure a substantial amount of energy from wind power. The Norwegians are pressing ahead with wave power, and Scotland too has appropriate sites to develop that source of energy successfully.
      800
      However, the chances of those alternative sources of energy being developed are much reduced by the fact that Scotland has massive extra capacity, most of it nuclear. That would seem to pre-empt significant amounts of investment in Scotland. I know that the Minister will say that certain things are happening—I am aware of them—but they are very small and I cannot see that significant commercial developments will result from them.
      In any case, upgrading the interconnector is absolutely crucial if Scotland is to offload its capacity. That brings me to the crunch question for Scotland, to which I do not believe that the Government can give any answer. The method of calculating prices means that prices in Scotland will be based on the average rather than on Scotland's costs. The consequence of that will inevitably ensure that my constituents in the north of Scotland, who currently enjoy the lowest unit price of electricity in the country—and need to, given where they live—will find themselves rising rapidly up the scale of charges as a direct result of this privatisation.
      On top of that, if the Scottish boards find difficulty contracting the sale of their nuclear-powered electricity, it seems that Scottish consumers, as well as Scottish shareholders, will be stuck with a capacity that they cannot sell and with a debt that they still have to service. The consequences could be disastrous for Scottish consumers. Whatever the perception of the Bill in England and Wales—and wherever one goes, the Bill is opposed by the majority of people—I have no doubt that the opposition to it in Scotland is more substantial, basically because in this legislation the Government are refusing to acknowledge the different structure, traditions and history of electricial generation in Scotland. The Government have lumped all the provisions into a global Bill with the consequence that Scottish interests—and the differences in the mix, the organisation and structure of the industry in Scotland—have not been taken into account.
      That is why I have tabled amendments to take references to Scotland out of the provisions. I admit that they are probing amendments, but they are based on the premise that, as we reach the end of the Bill's passage through Parliament, it is apparent that it is bad news for the United Kingdom, but very bad news for Scotland. That probably means that it will be bad news for the Government in the polls in England, and very bad news for them in Scotland, but they have become used to that and perhaps after the next election there will be no Tory Members left in Scotland to bring back the reports of what happened.
      However, that is as may be. My conclusions are simply that the non-fossil fuel levy and the safety issues are serious considerations, that the Lords amendments improve the Bill, and that it is regrettable that the Government are trying to reverse them.
      Mr. McCartney: In our Committee discussions on nuclear safety, those of us who have been involved in local government and in the preparation of plans relating to the nuclear industry argued for a bipartisan policy on this matter. Irrespective of whether one is pro or anti-nuclear, or pro or anti-privatisation, one must agree that it is essential to the nation's security that we come up with an acceptable and workable set of proposals not only for on-site, but also for off-site emergency planning measures for nuclear installations.

      801
      In Committee, in the Lords and again this evening, the tragedy has been the Government's unwillingness to accept a bipartisan approach to nuclear safety and to the development of off-site and on-site plans. In these privatisation proposals, the Government have missed a real opportunity to look at what has happened during the past decade between the nuclear industry and the emergency planning officers in local government, both at county level and at fire and civil authority level. All of us who have been involved in this issue over that period accept the need to resolve the inadequate relationship between planning officers and the nuclear industry as it currently stands.
      8.15 pm
      In Committee, the Minister went some way to accepting the need for a radical change in the current position in relation to on-site, but especially to off-site, emergency planning. He acknowledged that by saying that it was the Government's intention to bring forward proposals similar to those that are currently operating in industry for large-scale petrochemical plants and for other industrial processes that can cause difficulties and accidents. However, he did not go on to accept the current inadequacies of our off-site emergency planning procedures in terms of the ability of local authority emergency planning departments to sit down in consultation with the nuclear industry and with those in the community who live close to a nuclear plant and to come up with proposals to improve the existing position.
      It is because of the inability and the lack of willingness on the part of the nuclear industry in the past decade to take local communities and emergency planning departments into its confidence that in the past few years local authorities and, through their professional bodies, the planning officers, have attempted to initiate new plans and proposals to upgrade and modernise off-site emergency planning activities. That has included a number of table top exercises, paid for by local authorities, which looked at the current position in the industry and the likely response from the local community in the event of varying scenarios of nuclear incidents.
      Each time, the exercises showed the inadequacies of the development of off-site plans in all regions, whether in the north-west, the south-west, Scotland or anywhere else with a nuclear installation. All such table top exercises have shown up the glaring anomalies and the lack of accountability of the nuclear industry. They have also shown the lack of an adequate relationship between the industry and those responsible for the development of local off-site emergency plans.
      Therefore, although the Minister will not accept any of the amendments that have been tabled and will attempt to eradicate those from another place, I hope that he will accept, irrespective of his personal views and his political animosity towards Opposition Members, that we should come to a bipartisan approach to off-site emergency planning.
      In Committee, both I and my hon. Friend the Member for Carmarthen (Mr. Williams) spent a great deal of time over several days dealing with amendments and general discussions in clause stand part debates trying to set out a framework and structure for the type of amendments that would be required if there were to be any meaningful
      802
      relationship and public accountability for off-site emergency planning or public involvement through emergency planning departments and officers.
      Despite promptings from me and other hon. Members to come to see what was happening at local authority level, Ministers still insisted that the Government totally accepted the current position, and that there was no need for any major changes. However, that is flying against all international views on this and against the advice that is currently being given to the Government by the chief emergency planning officers and their professional bodies.
      The Government are still refusing to amend their proposals on "reference accident"—although the International Atomic Energy Agency sees the reference accident scenario as inadequate under the current proposals. The reference accident is based on analyses of possible failures of components and systems, and fails to take into account that accidents that have happened overseas in the nuclear industry have not been because of a failure in the fail-safe component systems, but have been mainly through human error, especially those at Three Mile Island and Chernobyl. The Government's proposals do not take account of on-site and emergency planning for such human errors and the accident that would flow from a major disaster involving the culpability of people working in installations.
      Experience also shows that site operators fail to provide efficient on-site and off-site plans. It is therefore an absolute necessity that the Government proposals should bring about a system whereby the nuclear industry would sit down and work out in consultation with emergency planning departments a comprehensive plan for each nuclear installation, whether in the public or private sector. It is important, too, that we have a proper system of notification in the development of such plans to ensure the involvement of local communities and community organisations.
      I shall quote from a recent report prepared by the chief emergency planning officers' professional body, which I believe the Minister has seen. Perhaps he will tell us tonight whether he is prepared to accept the report's recommendations. It states:
      "Nuclear installations should come under similar legislation to other industrial major hazard sites in that the operator should be required to engage County Authorities in producing the off-site plan for which the operator would pay. The operator would then have a duty to provide information to the public about the activities of the site and the appropriate counter measures to take in the event of an accident in response to an agreed warning system and the management of an off-site emergency plan would be in the hands of the Civil Authorities"
      and not in the hands of a nuclear industry as it currently stands.
      It is important, therefore, that the Minister does not simply reject the Lords amendment, or reject out of hand the Opposition's proposals, but that he comes up with a positive response to the genuine fears not just of politicians but of people in the community, community leaders and emergency planning officers, who have had experience of emergency procedures in, for example, the armed services, the Home Office and other Government Departments. None of them has been appointed because of a political allegiance to any particular party or policy on nuclear matters. They are appointed because of their experience and qualifications on emergency planning matters. When people with such experience and understanding of the

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      situation tell the Government that the current position is inadequate, the Government should respond positively to their proposals.
      In the recommendations for change, the Government should accept the abandonment of the reference accident as a basis for plans. They should accept an increase in the minimum emergency planning zone from 3 km to 10 km, two further planning zones of 25 km and 100 km, and an automated and extensive warning system should be established, coupled to a pre-arranged local radio station for the transmission of emergency information. There should be a legal requirement for county-level authorities to prepare and maintain composite off-site plans and for the site operator's role in the off-site emergency responses to be curtailed, and the responsibility for setting up the off site operational support centres and implementing counter-measures should pass ultimately to the police.
      We require the development of a mutual aid agreement between adjacent counties, because we have seen in Three Mile Island and in Chernobyl that accidents are not just contained within a region or a sub-region, but can cover the globe and create a European scenario or, in the United States, affect a whole state. It is important, therefore, that off-site emergency plans are not just developed for the immediate hinterland around an installation, but are co-ordinated regionally and ultimately at a national level. That must mean the creation of a national disaster unit, which would co-ordinate emergency responses at a national level. There would be an emergency planning inspectorate to evaluate all areas of emergency planning and to possess the power to withhold site licences for those operators whose off-site plans are not of the required standard.
      Those are the minimum requirements and they are well within the grasp of the Government if they are prepared to take a non-party political view and to accept that the priority should not be to ensure that the industry is sweetened up for privatisation by downgrading and keeping to a minimum the basic measures needed for emergency planning. That is in the interests of no one, and especially is not in the interests of the industry.
      One of the problems that has bedevilled the nuclear industry over the past decade, and still continues to do so, is people's unwillingness to accept the industry's assurances about its safety record. One thing that the industry could do to help itself, and that the Government could do to help the industry if they are interested in promoting nuclear power, is to give the public and the bodies that represent the public the opportunity to have a real say in the development of off-site emergency plans. Unless the Government give such a commitment and the resources to do it, there will still be public scepticism and fear about the nature of the emergency plans, their adequacy and who would control them if there was an accident.
      I hope that the Minister will for once be positive in this matter and accept that the Opposition have some good ideas and some common-sense views about the development of such plans. Perhaps, if there was some co-operation between us, the fears that many people have about the nuclear industry and of a nuclear accident would, while not being completely ameliorated, be calmed, and for once, during the lifetime of the nuclear industry, the general public and local authorities would be involved
      804
      in a real sense in the development of emergency plans, and their structure and criteria would be established in an effective and efficient manner.
      Mr. Alan W. Williams: I address my comments to Lords amendment No. 21, which is a simple one. It gives the Secretary of State the power to take over a nuclear power station on grounds of safety whenever there might be a serious incident. In nuclear power, accidents do happen. There was a time when the nuclear industry used to claim that there were so many fail-safe systems that a serious accident could never happen—it was, for example, one every 1,000 million reactor years.
      Then, in 1979, came the accident at Three Mile Island, when a pressurised water reactor came to within one hour of meltdown and, in 1986, there was Chernobyl, when a reactor went completely out of control. It burned furiously for two weeks or more and spilled out 5 per cent. of its radioactive content. That led to the evacuation of almost 100,000 people and the declaration of a zone 30 km around the reactor as uninhabitable. I read recently that more villages have just been evacuated in that area. The fallout went north of Chernobyl, and it is clear now that the soil and the food that is grown there are contaminated. They have therefore had to evacuate a further 25 villages.
      Now, post-Chernobyl, they are finding deformities in animals, an increase in ill-health, thyroid problems among children and a doubling in the incidents of cancers to the lip and mouth. That shows that, when there is a major nuclear accident at a reactor, it can be disastrous. The cost of Chernobyl was conservatively estimated at £5 billion. The Government have argued that such accidents could not occur with our reactors, but that is transparent nonsense, as our reactors could fail just as disastrously.
      I am pleased that, as a result of the statement, the Government have decided not to privatise the Magnox power stations, because those reactors are clapped out and, at any time, one of them could fail disastrously. I wish that the Government were not going to privatise the AGRs, PWRs or any other part of the electricity industry. At the Hinkley inquiry, the CEGB has now conceded that the newly designed PWRs could suffer a meltdown. It would be in such circumstances that we want the Secretary of State to have the power to take over a nuclear power station.
      8.30 pm
      I am aware that clause 92 gives the Secretary of State some power to give directions for the purpose of
      "preserving the security of buildings".
      That wording is extremely vague. The Minister spoke. about the nuclear installations inspectorate and its powers. We are well aware of those powers, but the NII is incredibly under-staffed, to which my hon. Friend the Member for Cardiff, West (Mr. Morgan) has already drawn attention. It is a national scandal that the NII, in common with all anti-pollution inspectorates, is understaffed. If a serious accident on the scale of Three Mile Island or Chernobyl were to occur, the NII would have insufficient powers to rescue us.
      The public are genuinely worried about nuclear safety; perhaps that is the No. 1 reason why the public are so anti-nuclear. That concern is already felt about an industry that is in public control, but once that industry passes into private hands that concern will grow. There will be great

      805
      concern about privatised PWRs that will be able to produce 1,000 MW or 1,200 MW, the largest capacity in the world.
      The new clause proposed in Lords amendment No. 21 would give the Secretary of State a reserve power, which we hope that he would never have to exercise. If there were a major incident, the Secretary of State, as the public would want, could take over a nuclear installation. It is a long-stop amendment, as we hope that that power would never be needed.
      If there was a major incident, chaos and confusion would reign. That is what happened at Chernobyl and that was our Government's reaction to that accident. The Lords amendment would give the Government the power to intervene and to tell the people that it was their responsibility to take over a particular installation rather than to act as passive bystanders.
      The Government should accept the sensible amendment, as it would give the Secretary of State an absolute right to take over a nuclear installation in the interests of public safety.
      Mr. Kevin Barron: My hon. Friends the Members for Makerfield (Mr. McCartney) and for Carmarthen (Mr. Williams) have made good contributions and, although their comments may have been somewhat wide of the amendment, the Government should take on board what they have said about emergency planning.
      My hon. Friend the Member for Carmarthen was right to say that Lords amendment No. 21 is a long-stop amendment for the Secretary of State. We all hope that he would never have to use the power, but as the other place said, that power is a response to the fears that have been expressed by many of our constituents about nuclear power. More important, it reflects the fears held by many about the nuclear power industry being transferred to the private sector, especially as the private sector has not had a brilliant record in many sectors.
      It may be argued that the Secretary of State has control over institutions such as the NII and that, therefore, there is no need for the Government to accept the amendment, despite its inoffensiveness. My hon. Friends have already demonstrated, however, that the NII is currently under-staffed. Until that is put right to the satisfaction of the inspectorate and everyone else, no one can be too happy.
      The Minister said that amendment No. 28 and the other amendments in relation to the non-fossil-fuel levy were technical amendments. That is probably right as those amendments take up two and a half pages to amend two pages of the Bill covering clauses 32 and 33. Technical amendments of such length have been introduced on Report on all manner of Bills; they are symptomatic of this Bill and of the Government. Somewhere deep-seated in No. 10 we have a policy unit that devises schemes to move things out of the public sector into the private sector. The maxim is: public sector bad; private sector good.
      Here we have two and a half pages of amendments to cover just three pages of the Bill that we discussed in December on Second Reading. Those two and a half pages relate to perhaps the most dogmatic part of the Bill, the Government's action to ring-fence the nuclear electricity industry as opposed to any other part of it. That action
      806
      distorts the competition in the Bill, the very competition that we are told is the main reason for the Government to privatise the electricity supply industry.
      Today, we have heard the bugles of retreat sound in relation to some of that ring-fencing as the Magnox stations will no longer be part of the private sector, because they are unsustainable. It appears that, although everyone else failed to convince the Government of that, the sounds from the City in the past few days did so.
      It is ironic that the only good thing to come out of clause 32 and the ring-fencing is that the Government have given a slight commitment to sources of renewable energy, something that has been largely forgotten for the past 10 years. It now appears that sources of renewable energy may be given a lifeline because of the non-fossil-fuel obligation to which suppliers will be bound.
      Hon. Members on both sides of the Chamber argued that combined heat and power should also be considered in relation to renewable sources of energy. That request was rejected in our earlier discussion of the Lords amendments. It was sad that, during the course of those very debates, the combined heat and power scheme put together by Leicester city council and a private consortium collapsed. It was intended that that scheme would lead the way in combined heat and power, but it collapsed because it was not allowed access to the grid. It believed that the East Midlands electricity board was operating its old cartel to keep out small and new producers.
      Although we shall not divide the House on the non-fossil fuel levy, we should take this last chance to remind people who are reading our debates and who look with interest to the outcome of electricity privatisation how distorted the Bill is from beginning to end. The non-fossil fuel levy and the events of the past few hours in the Chamber have shown this legislation to be nothing more than an ideological attack on the public sector. It has been ill-thought out and in years to come we shall find that it will make electricity, which was once easy to come by, more difficult to get hold of and more expensive when it arrives.
      Mr. Michael Spicer: With the leave of the House, I wish to answer one or two of the questions that have been asked.
      The hon. Member for Cardiff, West (Mr. Morgan) asked whether leaving Magnox stations in the public sector would affect the safety regime; the hon. Member for Carmarthen (Mr. Williams) asked the same question. The structure of the industry has no bearing on the safety regime, which will be controlled by legislation that is already on the statute book. The operator is responsible for safety, under the command and control structure of the nuclear installations inspectorate.
      In this context, the hon. Member for Cardiff, West perfectly properly asked—as did the hon. Member for Rother Valley (Mr. Barron)—whether NII staffing would be adequate for the future of the industry. NII staff numbers have been significantly increased lately. We entirely agree that the inspectorate's staffing must be adequate, and I assure the House that it will be adequate to meet the NII's responsibilities.
      There were 120 inspectors at 1 April 1988, and the inspectorate has the authority to increase their number by 33 per cent., to 160 inspectors, by 1 April 1990. We shall discuss all aspects of the new arrangements, including

      807
      staffing requirements, with the NH to ensure that high standards are maintained in the industry. We agree with the Opposition about that and I hope that they are reassured by what I have said.
      Mr. Morgan: Considering the new questions that now face the NII when determining, almost on a six-monthly basis, whether this or that Magnox station can safely continue operating, and, if so, what work must be done on it before it can be approved, is the increase of 40 in the approved establishment, for which the Government say they are willing to pay, what the NII has asked for to meet its responsibilities, which have been increased by the changed circumstances of the industry; or is that some lower figure?
      Mr. Spicer: There is no change as regards safety. The Magnoxes are reaching the end of their working lives. Questions of safety relating to those stations arise under present structures, which have not changed. The resources will be provided so that the NII can carry out its statutory responsibilities.
      There may be some qualification in this context: the NII cannot ask for excessive resources, but, like the Opposition, we want to ensure that the industry continues to be as safe in the future as it has been in the past. The NII is the instrument to achieve that, so it stands to reason that it must have adequate resources. We are at one with the Opposition on that.
      The hon. Members for Makerfield (Mr. McCartney) and for Gordon (Mr. Bruce) asked about emergency procedures which, as they acknowledged, we discussed at some length in Committee. Matters have moved on, to the extent that it was recently announced that new health and safety regulations are to be made under the Health and Safety at Work etc. Act 1974. The regulations will place a formal requirement on local authorities to prepare integrated off-site plans for nuclear installations similar to those in the control of industrial major accident hazard regulations—the CIMAH regulations—which now cover the chemical industry. That would put on a statutory footing arrangements for emergency procedures which already exist. I hope that that announcement answers the arguments advanced by the hon. Member for Makerfield and by other hon. Members.
      The hon. Member for Gordon raised one or two points about Scotland—most pertinently, about the non-fossil fuel obligation. The reason why that obligation does not exist in Scotland is the high level of non-fossil fuel generating capacity there. That capacity makes the obligation unnecessary for the foreseeable future.
      The hon. Member for Gordon went on to ask whether there would be some form of average pricing arrangements which would not put the same sort of commercial pressures—in the best sense of the word—on the industry in Scotland as are to be found elsewhere. The Nuclear Company in Scotland will be subject to regulation, and specifically subject to the need for transparent accounts and dealings. The regulator will be able to take a firm and direct view of whether the efficiency that he requires is present in the system.
      The hon. Member for Gordon also asked about renewables and about the non-fossil fuel obligation applying to France. He was right to say that we have set a special tranche of 600 MW for renewables, although they can also compete within the general non-fossil fuel
      808
      obligation. To some extent, that is a movable feast, capable of revision in the future. Should there be a massive under-provision for renewable capacity—in the context of the obligation for renewables—it would be open to the Government of the day to increase that tranche. That has been allowed for. So there is nothing final about this. the tranche, at 600 MW, looks about right in terms of a special arrangement within the overall NFFO for renewable.
      In the light of those remarks, I hope that the House will feel able to agree with us and to move on to the next debate.
      Question put, That this House doth disagree with the Lords in the said amendment:—
      The House divided: Ayes 291, Noes 190.

      Division 318]

      [8.48 pm

      AYES

      Adley, Robert

      Curry, David

      Alexander, Richard

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

      Alison, Rt Hon Michael

      Davis, David (Boothferry)

      Allason, Rupert

      Day, Stephen

      Amess, David

      Devlin, Tim

      Amos, Alan

      Dorrell, Stephen

      Arbuthnot, James

      Douglas-Hamilton, Lord James

      Arnold, Jacques (Gravesham)

      Dover, Den

      Arnold, Tom (Hazel Grove)

      Dunn, Bob

      Ashby, David

      Durant, Tony

      Atkins, Robert

      Evans, David (Welwyn Hatf'd)

      Atkinson, David

      Fairbairn, Sir Nicholas

      Baker, Nicholas (Dorset N)

      Fallon, Michael

      Banks, Robert (Harrogate)

      Favell, Tony

      Batiste, Spencer

      Fenner, Dame Peggy

      Beaumont-Dark, Anthony

      Field, Barry (Isle of Wight)

      Bellingham, Henry

      Fishburn, John Dudley

      Bendall, Vivian

      Fookes, Dame Janet

      Bennett, Nicholas (Pembroke)

      Forman, Nigel

      Benyon, W.

      Forsyth, Michael (Stirling)

      Bevan, David Gilroy

      Forth, Eric

      Biffen, Rt Hon John

      Fowler, Rt Hon Norman

      Blackburn, Dr John G.

      Fox, Sir Marcus

      Boscawen, Hon Robert

      Franks, Cecil

      Boswell, Tim

      Freeman, Roger

      Bottomley, Mrs Virginia

      French, Douglas

      Bowden, A (Brighton K'pto'n)

      Gale, Roger

      Bowis, John

      Gardiner, George

      Boyson, Rt Hon Dr Sir Rhodes

      Garel-Jones, Tristan

      Brandon-Bravo, Martin

      Gill, Christopher

      Brazier, Julian

      Glyn, Dr Alan

      Bright, Graham

      Goodlad, Alastair

      Brooke, Rt Hon Peter

      Goodson-Wickes, Dr Charles

      Brown, Michael (Brigg & Cl't's)

      Gorman, Mrs Teresa

      Browne, John (Winchester)

      Gorst, John

      Bruce, Ian (Dorset South)

      Grant, Sir Anthony (CambsSW)

      Budgen, Nicholas

      Greenway, Harry (Ealing N)

      Burns, Simon

      Greenway, John (Ryedale)

      Burt, Alistair

      Gregory, Conal

      Butler, Chris

      Griffiths, Sir Eldon (Bury St E')

      Butterfill, John

      Griffiths, Peter (Portsmouth N)

      Carlisle, John, (Luton N)

      Ground, Patrick

      Carlisle, Kenneth (Lincoln)

      Gummer, Rt Hon John Selwyn

      Carrington, Matthew

      Hague, William

      Carttiss, Michael

      Hamilton, Neil (Tatton)

      Cash, William

      Hampson, Dr Keith

      Chapman, Sydney

      Hanley, Jeremy

      Chope, Christopher

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

      Churchill, Mr

      Hargreaves, Ken (Hyndburn)

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

      Harris, David

      Clark, Dr Michael (Rochford)

      Hayes, Jerry

      Clarke, Rt Hon K. (Rushcliffe)

      Heathcoat-Amory, David

      Conway, Derek

      Heddle, John

      Coombs, Anthony (Wyre F'rest)

      Hicks, Mrs Maureen (Wolv' NF.)

      Coombs, Simon (Swindon)

      Higgins, Rt Hon Terence L.

      Cope, Rt Hon John

      Hill, James

      Cormack, Patrick

      Hind, Kenneth

      Couchman, James

      Hogg, Hon Douglas (Gr'th'm)

      Cran, James

      Holt, Richard

      Currie, Mrs Edwina

      Hordern, Sir Peter

      809

      Howard, Michael

      Onslow, Rt Hon Cranley

      Howarth, G. (Cannock & B'wd)

      Oppenheim, Phillip

      Howell, Ralph (North Norfolk)

      Page, Richard

      Hughes, Robert G. (Harrow W)

      Paice, James

      Hunt, David (Wirral W)

      Parkinson, Rt Hon Cecil

      Hunt, Sir John (Ravensbourne)

      Patnick, Irvine

      Hunter, Andrew

      Patten, Rt Hon Chris (Bath)

      Hurd, Rt Hon Douglas

      Patten, John (Oxford W)

      Irvine, Michael

      Pawsey, James

      Irving, Charles

      Peacock, Mrs Elizabeth

      Jack, Michael

      Porter, Barry (Wirral S)

      Jackson, Robert

      Portillo, Michael

      Janman, Tim

      Powell, William (Corby)

      Jessel, Toby

      Price, Sir David

      Johnson Smith, Sir Geoffrey

      Raffan, Keith

      Jones, Gwilym (Cardiff N)

      Raison, Rt Hon Timothy

      Jones, Robert B (Herts W)

      Redwood, John

      Jopling, Rt Hon Michael

      Renton, Tim

      Kellett-Bowman, Dame Elaine

      Rhodes James, Robert

      Key, Robert

      Riddick, Graham

      Kilfedder, James

      Ridsdale, Sir Julian

      King, Roger (B'ham N'thfield)

      Rifkind, Rt Hon Malcolm

      Kirkhope, Timothy

      Roe, Mrs Marion

      Knapman, Roger

      Rossi, Sir Hugh

      Knight, Greg (Derby North)

      Rost, Peter

      Knight, Dame Jill (Edgbaston)

      Rowe, Andrew

      Knowles, Michael

      Rumbold, Mrs Angela

      Lamont, Rt Hon Norman

      Sackville, Hon Tom

      Lang, Ian

      Sayeed, Jonathan

      Latham, Michael

      Shaw, David (Dover)

      Lawrence, Ivan

      Shaw, Sir Giles (Pudsey)

      Lee, John (Pendle)

      Shaw, Sir Michael (Scarb')

      Lennox-Boyd, Hon Mark

      Shephard, Mrs G. (Norfolk SW)

      Lester, Jim (Broxtowe)

      Shepherd, Colin (Hereford)

      Lightbown, David

      Shersby, Michael

      Lilley, Peter

      Skeet, Sir Trevor

      Lloyd, Sir Ian (Havant)

      Smith, Sir Dudley (Warwick)

      Lloyd, Peter (Fareham)

      Smith, Tim (Beaconsfield)

      Lord, Michael

      Soames, Hon Nicholas

      Luce, Rt Hon Richard

      Speed, Keith

      Lyell, Sir Nicholas

      Speller, Tony

      McCrindle, Robert

      Spicer, Sir Jim (Dorset W)

      MacKay, Andrew (E Berkshire)

      Spicer, Michael (S Worcs)

      McLoughlin, Patrick

      Squire, Robin

      McNair-Wilson, Sir Michael

      Stanbrook, Ivor

      McNair-Wilson, Sir Patrick

      Stanley, Rt Hon Sir John

      Malins, Humfrey

      Stern, Michael

      Maples, John

      Stevens, Lewis

      Marlow, Tony

      Stewart, Allan (Eastwood)

      Marshall, John (Hendon S)

      Stewart, Andy (Sherwood)

      Marshall, Michael (Arundel)

      Stewart, Rt Hon Ian (Herts N)

      Martin, David (Portsmouth S)

      Stokes, Sir John

      Mates, Michael

      Sumberg, David

      Maude, Hon Francis

      Summerson, Hugo

      Mawhinney, Dr Brian

      Tapsell, Sir Peter

      Maxwell-Hyslop, Robin

      Taylor, Ian (Esher)

      Mayhew, Rt Hon Sir Patrick

      Taylor, John M (Solihull)

      Meyer, Sir Anthony

      Taylor, Teddy (S'end E)

      Miller, Sir Hal

      Tebbit, Rt Hon Norman

      Mills, Iain

      Temple-Morris, Peter

      Miscampbell, Norman

      Thompson, Patrick (Norwich N)

      Mitchell, Andrew (Gedling)

      Thorne, Neil

      Mitchell, Sir David

      Thornton, Malcolm

      Moate, Roger

      Thurnham, Peter

      Monro, Sir Hector

      Townend, John (Bridlington)

      Montgomery, Sir Fergus

      Townsend, Cyril D. (B'heath)

      Moore, Rt Hon John

      Tracey, Richard

      Morris, M (N'hampton S)

      Tredinnick, David

      Morrison, Rt Hon P (Chester)

      Trippier, David

      Moss, Malcolm

      Trotter, Neville

      Moynihan, Hon Colin

      Twinn, Dr Ian

      Mudd, David

      Waddington, Rt Hon David

      Neale, Gerrard

      Waldegrave, Hon William

      Needham, Richard

      Walden, George

      Nelson, Anthony

      Walker, Bill (T'side North)

      Newton, Rt Hon Tony

      Waller, Gary

      Nicholls, Patrick

      Ward, John

      Nicholson, David (Taunton)

      Wardle, Charles (Bexhill)

      Nicholson, Emma (Devon West)

      Warren, Kenneth

      Norris, Steve

      Wells, Bowen

      810

      Wheeler, John

      Woodcock, Dr. Mike

      Whitney, Ray

      Yeo, Tim

      Widdecombe, Ann

      Young, Sir George (Acton)

      Wiggin, Jerry

      Winterton, Mrs Ann

      Tellers for the Ayes:

      Winterton, Nicholas

      Mr. Alan Howarth and Mr. David Maclean.

      Wolfson, Mark

      Wood, Timothy

      NOES

      Abbott, Ms Diane

      Garrett, John (Norwich South)

      Adams, Allen (Paisley N)

      Garrett, Ted (Wallsend)

      Allen, Graham

      Gilbert, Rt Hon Dr John

      Alton, David

      Godman, Dr Norman A.

      Anderson, Donald

      Golding, Mrs Llin

      Archer, Rt Hon Peter

      Gordon, Mildred

      Armstrong, Hilary

      Gould, Bryan

      Ashdown, Rt Hon Paddy

      Graham, Thomas

      Ashley, Rt Hon Jack

      Grant, Bernie (Tottenham)

      Ashton, Joe

      Griffiths, Nigel (Edinburgh S)

      Banks, Tony (Newham NW)

      Griffiths, Win (Bridgend)

      Barnes, Harry (Derbyshire NE)

      Grocott, Bruce

      Barnes, Mrs Rosie (Greenwich)

      Hardy, Peter

      Barron, Kevin

      Haynes, Frank

      Battle, John

      Healey, Rt Hon Denis

      Beckett, Margaret

      Henderson, Doug

      Beith, A. J.

      Hinchliffe, David

      Benn, Rt Hon Tony

      Hogg, N. (C'nauld & Kilsyth)

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

      Home Robertson, John

      Bermingham, Gerald

      Hood, Jimmy

      Bidwell, Sydney

      Howarth, George (Knowsley N)

      Blair, Tony

      Howell, Rt Hon D. (S'heath)

      Boateng, Paul

      Hoyle, Doug

      Boyes, Roland

      Hughes, John (Coventry NE)

      Bradley, Keith

      Hughes, Robert (Aberdeen N)

      Bray, Dr Jeremy

      Hughes, Roy (Newport E)

      Brown, Nicholas (Newcastle E)

      Illsley, Eric

      Bruce, Malcolm (Gordon)

      Ingram, Adam

      Buckley, George J.

      Janner, Greville

      Caborn, Richard

      Johnston, Sir Russell

      Callaghan, Jim

      Jones, Barry (Alyn & Deeside)

      Campbell, Ron (Blyth Valley)

      Jones, Martyn (Clwyd S W)

      Campbell-Savours, D. N.

      Kennedy, Charles

      Canavan, Dennis

      Kinnock, Rt Hon Neil

      Cartwright, John

      Kirkwood, Archy

      Clark, Dr David (S Shields)

      Lamond, James

      Clarke, Tom (Monklands W)

      Leighton, Ron

      Clay, Bob

      Lewis, Terry

      Clelland, David

      Litherland, Robert

      Clwyd, Mrs Ann

      Lloyd, Tony (Stretford)

      Cohen, Harry

      Lofthouse, Geoffrey

      Coleman, Donald

      McAllion, John

      Cook, Robin (Livingston)

      McAvoy, Thomas

      Cousins, Jim

      McCartney, Ian

      Cryer, Bob

      Macdonald, Calum A.

      Cummings, John

      McKay, Allen (Barnsley West)

      Cunliffe, Lawrence

      McKelvey, William

      Darling, Alistair

      McLeish, Henry

      Davies, Rt Hon Denzil (Llanelli)

      Maclennan, Robert

      Davies, Ron (Caerphilly)

      McWilliam, John

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

      Madden, Max

      Dewar, Donald

      Mahon, Mrs Alice

      Dixon, Don

      Martin, Michael J. (Springburn)

      Dobson, Frank

      Meacher, Michael

      Doran, Frank

      Meale, Alan

      Duffy, A. E. P.

      Michael, Alun

      Dunwoody, Hon Mrs Gwyneth

      Michie, Bill (Sheffield Heeley)

      Eadie, Alexander

      Michie, Mrs Ray (Arg'l & Bute)

      Eastham, Ken

      Mitchell, Austin (G't Grimsby)

      Ewing, Harry (Falkirk E)

      Morgan, Rhodri

      Ewing, Mrs Margaret (Moray)

      Morris, Rt Hon A. (W'shawe)

      Fatchett, Derek

      Morris, Rt Hon J. (Aberavon)

      Fearn, Ronald

      Mowlam, Marjorie

      Fisher, Mark

      Mullin, Chris

      Flannery, Martin

      Murphy, Paul

      Flynn, Paul

      Nellist, Dave

      Foot, Rt Hon Michael

      Oakes, Rt Hon Gordon

      Foster, Derek

      O'Brien, William

      Fraser, John

      Patchett, Terry

      Galloway, George

      Pendry, Tom

      811

      Pike, Peter L.

      Steinberg, Gerry

      Powell, Ray (Ogmore)

      Stott, Roger

      Primarolo, Dawn

      Straw, Jack

      Quin, Ms Joyce

      Taylor, Mrs Ann (Dewsbury)

      Radice, Giles

      Taylor, Matthew (Truro)

      Randall, Stuart

      Thompson, Jack (Wansbeck)

      Redmond, Martin

      Turner, Dennis

      Rees, Rt Hon Merlyn

      Vaz, Keith

      Richardson, Jo

      Wall, Pat

      Roberts, Allan (Bootle)

      Wallace, James

      Robinson, Geoffrey

      Walley, Joan

      Rogers, Allan

      Warden, Gareth (Gower)

      Rooker, Jeff

      Wareing, Robert N.

      Ross, Ernie (Dundee W)

      Watson, Mike (Glasgow, C)

      Rowlands, Ted

      Welsh, Andrew (Angus E)

      Ruddock, Joan

      Welsh, Michael (Doncaster N)

      Salmond, Alex

      Williams, Rt Hon Alan

      Sedgemore, Brian

      Williams, Alan W. (Carm'then)

      Sheldon, Rt Hon Robert

      Wilson, Brian

      Shore, Rt Hon Peter

      Winnick, David

      Short, Clare

      Wise, Mrs Audrey

      Skinner, Dennis

      Worthington, Tony

      Smith, Andrew (Oxford E)

      Young, David (Bolton SE)

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

      Smith, J. P. (Vale of Glam)

      Tellers for the Noes:

      Soley, Clive

      Mr. Frank Cook and Mr. Jimmy Dunnachie.

      Spearing, Nigel

      Question accordingly agreed to.
      Lords amendments Nos. 81 to 89 disagreed to.
      Lords amendments Nos. 28 to 50, 78 and 79 agreed to.

    Clause 1

      THE DIRECTOR GENERAL OF ELECTRICITY SUPPLY
      Lords amendment: No. 1, in page 1, line 11, at end insert
      "in a manner that protects consumers of electricity without discrimination".
      9 pm
      Mr. Michael Spicer: I beg to move, That this House doth disagree with the Lords in the said amendment.
      Mr. Deputy Speaker: With this it will be convenient to take Lords amendment No. 8, and Lords amendments Nos. 23 and 24, with the Government motions to disagree.
      Mr. Spicer: Lords amendment No. 1 requires the director to protect consumers without discrimination. This would apply irrespective of who was actually supplying any particular consumer. If this amendment were agreed the director would have no option but to ensure that all licensed suppliers dealt with their customers on exactly the same basis in all respects.
      In terms of prices, there could be no differentiation on the basis of the different and disparate requirements and characteristics of the customers and customer groups—industrial, commercial and domestic customers would have to be treated identically under the terms of the amendment. Nor could there be any scope for individual contracts since the terms of these could not be allowed to differ from what was offered to all other customers. The prices charged for electricity would have to be the same for a factory and a flat.
      The requirement does not stop with prices. There could be no special protection for groups such as the elderly and the disabled. Nor could there be any aid for those who have difficulty in paying their bills. This would clearly be discriminatory against those who are not elderly or who had paid their bills on time.
      In short, this is a wrecking amendment that attacks the central theme of the Bill by preventing the scope for
      812
      competition in the supply of electricity and by doing so, rather than protecting the interests of consumers a s it purports to do, it damages them by withholding the benefits of reduced costs and hence prices which would flow from competition.
      It may be that the proponents of the amendment did not intend these effects but were concerned to ensure that there can be no unjustified discrimination between customers by suppliers. From this point of view, the amendment is unnecessary because, under clause 3, the director and the Secretary of State are already required to exercise their functions so as to protect the interests of all consumers of electricity in respect of prices. There are, in addition, provisions in clause 18 and in the public electricity supply licence preventing the public electricity suppliers from exercising undue preference or undue discrimination. These guarantee that the customer will always be able to get supplies at a fair price and will not be required to subsidise lower prices to others.
      Mr. James Wallace: One of the concerns in remoter rural areas is the high cost of supplying electricity. Quotes of £60,000 have been mentioned. Clause 19 says that expenditure on supply will be recovered from
      "the person requiring the supply … to such extent as is reasonable in all the circumstances."
      Will the Minister explain or confirm that "all the circumstances" includes the means of the person who is seeking the supply of electricity?
      Mr. Spicer: It certainly would not under the terms of the amendment. I have explained that no class of consumer could be the subject of discrimination—for or against. A fair, proper and reasonable price will be one that reflects directly the cost of providing a service. There are ways in which those who cannot pay are assisted, such as the the pre-payment system. There are other methods through social security legislation in which direct assistance is given.
      Will a policy of non-discrimination in a new and competitive environment be in the interests of the rural customers whose interests the hon. Member for Orkney and Shetland (Mr. Wallace) has at heart? I understand that he is making a case for his poor rural constituents. If there is competition and the area companies are not able properly to compete in areas where there is intense competition, with the result that they lose customers in those areas, as in many instances they will have the same overheads they may have to increase prices for their remaining rural customers. That is something which seems to have eluded some of those who are arguing against competitive prices within their areas.
      In saying that there will be the ability to charge prices to meet competition, we are talking about a downward pressure on prices. If that ability is denied, everyone, including rural consumers, will be the losers in the end within area boards.
      We aim to ensure by the provisions in the Bill—I think that we wish to achieve the same result as the hon. Gentleman—that costs are a consideration. There cannot be cross-subsidisation when cost structures are not reflected in prices. We are trying to ensure also that area boards have the ability to compete for customers. In the process of competition, prices will fall.
      Mr. Beith: On the basis of the Minister's argument, is he saying that there will be no effective competition in the area of the North of Scotland Hydro-Electric Board? How else can he defend the fact that there will be a common tariff in that area and not in others?
      Mr. Spicer: I am sure that the hon. Gentleman was present in Committee when we debated that. It has been thought that the structure of the industry and the dispersal of the population in the north of Scotland are such that special conditions apply that do not apply in the rest of the country. The hon. Gentleman is as aware of the argument as I am. He may or may not agree with it but it is there and it is the argument that has won the day for giving the north of Scotland special treatment.
      The Government believe that Lords amendments Nos. 23 and 24 do not make sense. On the one hand, they would allow the supplier to show due preference in setting tariffs, but on the other they would prevent him from showing any discrimination. In particular, the supplier will not be allowed to show discrimination to rural customers. As no discrimination is to be shown to anyone, it is difficult to see what additional protection could be offered to any particular group. It is clear that any preference to any customer or group of customers must introduce a degree of discrimination. If there is no discrimination there can be no preference, due or undue.
      Load management is a major part of any electricity supplier's planning to optimise operations and to reduce costs. If by offering particular terms a supplier can persuade customers to accept limitations on their supply, or to use power in such a way as to help improve load management, that will be of benefit to all customers. That applies equally to the domestic consumer using the economy 7 tariff as to an industrial customer who has agreed load shedding arrangements to have effect at short notice. The amendments would prevent that happening.
      We understand that all the amendments are motivated by the objective and desire to ensure in future that due regard is paid to, and adequate protection provided for, rural customers. That is shown most clearly in amendment No. 8 to clause 3. We sympathise with that motivation. The clause already requires the director general and the Secretary of State to exercise their functions to protect the interests of all consumers in regard to prices. Nevertheless, we accept that the amendment will reinforce the requirement in respect of rural consumers. No doubt it would serve to draw to the attention of the Secretary of State and the director general the particular needs of rural consumers. In view of that, we invite the House to accept amendment No. 8.
      Mr. Alan Williams: I wish to speak to Lords amendment No. 1 and the consequential amendments Nos. 23 and 24. As the Minister has pointed out, those amendments are about rural prices and the fears of constituents in rural areas that as a consequence of the Bill they may pay more for their electricity than urban consumers.
      One can understand why the costs of distribution are greater in rural areas. Simply reading the meter is more expensive and the length of transmission lines means that the distribution costs are higher. If the privatised distribution companies started imposing economic costs on rural consumers, it could mean substantially increased charges. About 80 per cent. of the cost of electricity is for
      814
      generation, and distribution accounts for only about 20 per cent. Nevertheless, if the price of electricity is about 6p per unit, in towns and big cities the cost including distribution may be only 5p. Therefore, those areas may be helped. In rural towns the cost of electricity would be 7p or 8p per unit and in rural villages it would be more like 10p. For individual farmsteads or remote cottages the cost may be 15p or 20p per unit. That sort of price structure could emerge if we applied rigorous economic costing. It would hit our rural areas and farmers badly. There are many poor people in rural areas and rural poverty is sometimes as extreme as inner city poverty.
      In Committee the hon. Member for Berwick-upon-Tweed (Mr. Beith) pointed out forcefully that people do not realise that this provision is in the Bill. If people in rural areas realised that that was the case there would be outrage. There would be no end of complaints from our constituents and the postbags of Members representing rural areas would be full. Conservative Members would perhaps suffer disproportionately.
      In Committee the Government's reply to our argument was that the provision for differential pricing already exists and that our present electricity boards could, if they chose, charge rural consumers more than urban consumers. Under the present structure the industry is in the public sector so there is public accountability. Once it is privatised, the threat of differential pricing would be much greater.
      One of the local authorities in my constituency, independently of my work on the Bill, realised that that could be a consequence of the Bill. Dynevor borough council wrote to the Department of Energy expressing its concern. The reply, dated 19 June, stated:
      "The Bill makes it clear that tariffs may relate to different areas."
      It is obvious that differential pricing is possible. The letter also said that the area boards
      "have given an assurance that they expect to maintain common tariffs for domestic consumers for five years from privatisation."
      That gives a period of grace of five years. The letter then offers the reassurance that, after that time, should the private companies
      "choose to introduce differential tariffs, the licence also requires that any difference in the price offered to different tariff consumers would only be permitted so far as it reasonably reflected differences in the costs associated with the supply."
      I represent a constituency second only in size to Brecon and Radnor, and we fear that the remote areas will be adversely affected. Prices will be higher in rural villages in general and could even be doubled or trebled in remote areas.
      9.15 pm
      The principle of differential pricing is unjustifiable. I speak on behalf of the rural dwellers who already suffer from inadequate services, such as a lack of buses, and who have to face extra costs for rural transport. It is generally accepted that, for most services, urban areas should subsidise rural areas. For example, postal, telephone, gas and water services all operate under standard pricing. The Water Bill, which has paralleled the Electricity Bill, contains a clause that specifically rules out differential pricing.
      I hope that the Government will accept the sensible Lords amendments, which would ensure that electricity pricing protects consumers without discrimination.
      Mr. Beith: Despite the Government seeking refuge through technical objections to the wording of the amendments, their purpose is quite clear. They are about whether the new companies should be allowed to charge more to rural customers than to urban customers. The Minister failed to deal with that issue. The technical defects of the amendments are obvious, but the Government could have tabled amendments to put the objectives of the Lords amendments in the correct form, as they have with other amendments.
      The Government have abandoned the case for those who live in the countryside. Should the private companies be allowed to charge their rural customers more than their town customers? The Government answer that crucial question with two voices. For the north of Scotland, the answer is "No"—by statute, there can be no discrimination between urban and rural customers in any part of the hydro board's area. However, in the south of Scotland, in the whole of England and in Wales, discrimination will be allowed between different parts of each area. There is no sense in adopting two such contradictory positions.
      The Minister was in some difficulty when trying logically to respond to my intervention. He said that there were special circumstances and difficulties in different areas. Remoteness is remoteness, wherever it is. It is rather less remote on the outskirts of Inverness in the constituency of my hon. Friend the Member for Inverness, Nairn and Lochaber (Sir R. Johnston) than it is at the top of the Cheviots in my constituency, where the privatised company will be allowed to charge different tariffs.
      My hon. Friend the Member for Orkney and Shetland (Mr. Wallace), who is present, put it to the Minister at an earlier stage that it would be perfectly practicable to extend the common tariff from the north of Scotland to all areas, thereby confirming the practice of the existing electricity boards. The Minister replied:
      "I did not say that there was no way in which we could do it. I said that there is no way in which we would want to do it."—[Official Report, 6 April 1989; Vol. 150, c.400.]
      Conservative Members must realise that the Government have no desire to protect rural consumers from tariffs that discriminate against them, which is a ludicrous position to adopt.
      The Government's only other defence is that the chairmen designate of the electricity companies that do not yet exist have said that for five years they will maintain common tariffs. That statement is not enforceable in the courts and is without authority. It is, by their own definition, a transitional arrangement, at the end of which the companies may launch a programme of higher charges to rural consumers.
      Any right hon. or hon. Member who doubts that possibility should consider the case of British Gas. Only two weeks ago, British Gas warned that it will introduce variable tariffs for domestic consumers in different regions if a price war develops with privatised electricity distribution companies. The new chairman of British Gas warned that he would have to meet the competition
      "to hold the load",
      which means that consumers in some areas might enjoy price reductions, but that there would be compensatory increases in others. That will happen also in the privatised electricity industry beyond the north of Scotland area, unless the Government accept the Lords amendment or make comparable provision. The Government expect it to be that way and even want it to be that way. I doubt
      816
      whether many Conservative Members who normally sit on the Back Benches but who are not present tonight realise that they voted for such an arrangement.
      The concept of higher charging will take one of two forms, or both. The electricity companies may pick out some of the smallest communities that are the most expensive to serve and penalise them, or they may operate adverse tariffs over a wider area, against larger sections of the rural community. I take the example of a small area, Holy Island, in my constituency. It is served by a special cable, and when the south of Scotland electricity company is established, it would be open to it to impose a higher tariff.
      The same could apply to a comparable area, the Isles of Scilly, but for one factor—the Prime Minister's bête noire of Europe. The Isles of Scilly laid a new cable so that they could be served by mains electricity, which is cheaper than the high-cost, locally-generated electricity that they used before. However, the European regional development fund made it a condition of the grant that made that scheme possible that for the life of that cable—a period of 40 or 50 years—the Isles of Scilly would be charged only the same tariff as that imposed on the board's other areas.
      The hon. Member for St. Ives (Mr. Harris), who is also present, was involved in that process and will know of that decision. He must appreciate that only his constituents in the Isles of Scilly are protected, but others of his rural constituents could be charged higher tariffs. The company may say, "We shall have to look after the consumers on the Isles of Scilly because of the terms of the ERDF grant, but we can put up the prices in other parts of the St. Ives constituency as we can do, in Cornwall, Northumberland in mid-Wales."
      The electricity companies' alternative approach could be to operate a higher price structure outside the major urban areas, where they would want to compete more aggressively. Higher tariffs would apply not just to one or two remote rural communities but across a broad band of rural areas outside the major conurbations. Either way, a penalty will be exacted from rural consumers who have no choice of other fuel and who are the victims of the monopolistic character of energy supply.
      In most cases, rural customers will not have access to gas, which is why the electricity companies will he able to milk them for higher tariffs. The only alternatives for consumers are Calor gas and oil, and they will not have access to the major competitor to electicity—gas—that will be the cause of such price wars as arise in urban communities. Consumers who are unable to make the switch to another fuel, and to benefit from the competition between those other fuels and electricity, will be penalised.
      Farming, the small business sector, tourism and all the other activities on which rural communities depend will face higher electricity charges. And the small industries which have been developed in rural areas and which are the cornerstone of any strategy for rural Britain will be among those most adversely affected by higher tariff differentials. That has been been recognised by the National Farmers Union, which has written to hon. Members protesting vehemently at the possibility of differential tariffs against rural areas. The electricity consultative council for the south of Scotland area has written in similar terms, saying:
      "Our concern relates particularly to rural electricity consumers whether Domestic, Commercial or Industrial, in the South of Scotland who may be involved in higher

      817
      electricity charges resulting, for example, from additional expenditure on refurbishing transmission or distribution systems which are subject to more severe weather conditions than those in urban areas. It is the view of the Council that remote rural areas in the South of Scotland require no less protection than what is proposed for the North of Scotland area and there should be no possibility of discrimination between tariffs for the same class of consumer living in different areas of the South of Scotland."
      Incidentally, the same applies to consumers of the South of Scotland board who live in my constituency in England, because they also will be served by the company that replaces it. The same will apply throughout England and Wales.
      The other place did an excellent job when it defeated the Government on this part of the Bill. The Government, in their reference to and discussion of the amendments before us tonight, have simply taken refuge in technicalities and referred to the one amendment which would give the director general an obligation to take into account the needs of consumers in rural areas. That amendment alone would impose no obligation on the companies not to discriminate against rural areas. It is not sufficiently strong to protect the rural consumer from adverse tariffs which may already be planned for them by some of the people who will run those companies.
      In the absence of anything better, I ask the House to stand by the judgment of the other place. There are a great many people in the other place who know a great deal more about the countryside than most members of the Government and most of the people who devised the Bill. The Government's defeat in the other place was the result of a recognition of rural problems, which is still not apparent in the actions of Ministers.
      The Government still have time tonight to accept more of the Lords amendments and not seek to overturn them. I believe that the Government's attitude is a slap in the face for country dwellers throughout England, Wales and the south of Scotland. The House should not allow them to do it.
      Mr. Hardy: I agree emphatically with the hon. Member for Berwick-upon-Tweed (Mr. Beith), and I underline the powerful arguments advanced by my hon. Friend the Member for Carmarthen (Mr. Williams), who represents a large rural constituency.
      The Minister should understand that some Labour Members represent county seats in England. My constituency is a county seat because I argued at the Boundary Commission hearing that it should be. Even in my constituency, which is in a metropolitan area, I have small settlements and cottages here and there, off the beaten track, and I am extremely worried about the people who live there. After the five-year transition period—the hon. Member for Berwick-upon-Tweed reminded the House that there is no guarantee that we will have to wait until the five years is over—there could be serious developments. When people want to make a profit out of the electricity supply industry, those who live some distance away from a conurbation will be at risk.
      I am surprised that the Government have decided to treat the other place with contempt. As the hon. Member for Berwick-upon-Tweed said, the noble Lords who took
      818
      part in that debate know what they are talking about. They understand the anxieties in rural and not-so-rural areas of Britain.
      The Minister should have taken the time to watch television this weekend. They were burning an effigy of one of his right hon. Friends.
      Mr. James Hill: Hear, hear.
      Mr. Hardy: I felt sorry for the Minister concerned, whose effigy was burnt in one of Britain's most true-blue areas. The hon. Member for Southampton, Test (Mr. Hill) is not paying much attention, but it happened not far from his constituency. I had not expected to read that Conservative Ministers' effigies had been burnt in counties such as Hampshire, but it happened, and with good reason. The people responsible know that their areas are not being served well by an Administration who have hitherto pretended to care about rural Britain.
      9.30 pm
      Only a week or two ago, I took part in a debate in the House about a problem related to this—the housing problem. In huge parts of rural Britain, the cost of housing is now such that people who were born in a certain village, perhaps descended from generations of forebears who have lived there, can no longer afford to live there themselves. Now, even if they can afford the rent, they will not be able to afford the fuel. The Government are disregarding the yeomen to look after the yuppies, and the Bill is an example of their shifting priorities.
      I am worried about people living in such places as Lea Brook and Street in the parish of Wentworth, from which my constituency takes its name. I am also worried about slightly larger communities such as Hooton Roberts, which has 80 or 90 electors. I am worried about communities a little larger than that as well. As the squeeze for profit develops in the electricity supply industry, the community at risk may become larger and larger. The industry will certainly be eager to supply London; I do not know whether it will be eager to supply Wentworth, and I certainly do not think that in five years' time the people of Wentworth—the village and perhaps the constituency—should feel entirely confident that they will pay no more than those living in Sheffield, Manchester, Birmingham or London.
      If the Government begin to panic—there seems to be a good deal of panic in the air at present—to make sure that the people of Hampshire will not continue to burn effigies, they may decide to make electricity cheaper in the south than in the north. It is all very well for the hon. Member for Test to welcome such a prospect; I heard him shout, "Hear, hear," when I suggested that there was a serious risk. The fact remains that we have been subsidising the south of England for a long time in any case, because we have been bearing the cost of loss of transmission.
      Mr. Morgan: Seven per cent.
      Mr. Hardy: My hon. Friend is right.
      Because it is a national service, we have been prepared to accept the burden, but now that we see the real risk—as a result of all the effigies being burnt all over the south of England—Nye are entitled to be a little worried, fearing that additional burdens may be imposed on us. I hope that the Minister will reassure us, first, that the boards will be told emphatically that the five-year transition period constitutes a pledge that will not be broken, and, secondly,

      819
      that the electricity supply industry will be asked as a matter of urgency to ensure that that period is extended to at least 10 years—long enough, at any rate, to cover the political life of every Conservative Member.
      Thirdly, we should like an assurance that the Government are beginning to understand that the rural areas already face serious problems—problems of access, cost, housing and transport. Some of the older inhabitants of such areas may rapidly develop an inclination to take up witchcraft; the Secretary of State may wish to ponder the fact that, before long, the broomstick may be the only viable form of transport in some parts of Britain hitherto regarded as salubrious.
      I recognise that the Government face serious problems in relation to country dwellers. More farmers are going bankrupt in this year of grace, under this Administration, than ever before.
      The Government must recognise that the priorities that the other place embraced a few weeks ago have more political wisdom than the criticism that the Minister offered on the amendments when he said that they were wrecking amendments. I wish they were. Above all, I should like the Government to recognise that they may be wrecking but they are wise, and it would be wise of the Government to accept them.
      Mr. Wallace: I had not intended taking part in the debate, because my hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) argued cogently and effectively the reasons why the House should agree with the amendment proposed by the other place to protect the interests of rural consumers. However, the Minister's response to my intervention was so unsatisfactory that it is necessary for me to put some points on the record and to seek a further response from him.
      I welcome the fact that a special provision on common tariffs has been made for the North of Scotland Hydro-Electric Board area. This has been granted by the Government because they no longer see fit to include in the legislation a clause imposing a statutory duty on the company supplying electricity to the Highlands and Islands to take account of social and economic factors affecting that area. I accept that that makes this area different from others, but my hon. Friend the Member for Berwick-upon-Tweed and other hon. Members argued compellingly that rural consumers and those in other areas should be treated equally. I ask the Minister to consider their argument.
      Even the special treatment given to the hydro board falls short because of the cost of connection for new consumers of that board. Lords amendment No. 8 provides some protection for consumers in my constituency and elsewhere who face high connection costs. In my intervention and on Report, I instanced the case of a constituent who had been faced with a bill of over £60,000 for connection. He lives in an area which, for historical and archaeological reasons, is designated a conservation area, so the wires and lines must be placed underground, adding to the cost. On Report, the hon. Member for Western Isles (Mr. Macdonald) instanced other cases of consumers who were asked to pay £60,000. Since then, one of my constituents from the island of Stronsay has told me of a bill of more than £13,000. By no stretch of the imagination can people on modest incomes and pensioners readily find such amounts. In reply to my intervention, the Minister said that other means of help would be available.
      820
      When pressed, he mumbled something about social security assistance. I do not think that he intended that to be a full answer.
      I took up with the Minister of State, Scottish Office the case of my constituent with the £60,000 bill, and the hon. Gentleman took some time to reply. I do not complain about that, because the time was undoubtedly spent by him and his officials in trying to find what assistance might be available. The best that they could come up with was a £600 grant and £600 loan from the Crofters Commission. That is inadequate. It can be argued that this is an inadequacy of the present system, but there is nothing in the Bill to give consumers in the north of Scotland and elsewhere any confidence that under the new system connection charges will be reasonable and within the scope of most ordinary people.
      I found one ray of hope, which I hope that the Minister will consider. Clause 19 (1) refers to the power to recover expenditure and states:
      "Where any electric line or electrical plant is provided by a public electricity supplier in pursuance of section 16(1) above, the supplier may require any expenses reasonably incurred in providing it to be defrayed by the person requiring the supply of electricity to such extent as is reasonable in all the circumstances."
      The implication of "to such extent" is that the whole amount does not necessarily have to be recovered from the consumer. I should like to elicit from the Minister the circumstances in which he would consider it unreasonable for the cost to be defrayed by the consumer. Will the Minister consider that seriously? The present prices are prohibitive. Many people cannot afford to be connected to the mains electricity supply. They cannot benefit from facilities such as off-peak heating, and have to depend on generators, which can be unsatisfactory.
      Undoubtedly, the Minister will ask the House to vote against Lords amendment No. 8, which would provide the only protection for rural consumers. In his reply, will he give some hope to those faced with substantial bills for connection charges?
      Mr. Morgan: It falls to me to make the last contribution from the Opposition on this amendment. It is an old principle of Damon Runyon's New York that, "The opera ain't over until the fat lady sings." I say that without disrespect to the Prime Minister.
      It is clear from the debate that the Government's treatment of shareholders and consumers is different. By rejecting Lords amendment No. 1, the Government are saying that they cannot discriminate in favour of any group of consumers, yet they made it clear earlier that they would do anything to discriminate in favour of shareholders. That is the problem and that is why the Bill will redound to the Government's disadvantage at the next general election.
      Mr. Michael Spicer: The amendments highlight a difference between the philosophies of the Government and the Opposition parties. Either one agrees that competition will benefit the consumer and will put a downward pressure on prices or one does not.
      Mr. Beith: What about the northern board?
      Mr. Spicer: I have answered the hon. Gentleman about the northern board. It has been decided that it merits special treatment.

      821
      If one accepts that competition between the area boards will bring benefits to consumers—who can contract elsewhere for their electricity—it stands to reason that they should be able to charge prices to combat the effect of that competition. So long as the prices bear a relationship to cost, that will have the effect of bringing prices down in urban areas. We have talked about deprivation in rural areas, and in other circumstances the Opposition would talk about deprivation in urban areas, too. There will be a general downward pressure.
      I must answer the hon. Member for Wentworth (Mr. Hardy) about the policy of common tariffs. I assure him that the period will be five years. Thereafter, the policy of allowing the area boards to charge prices which relate to costs and allow them to compete will apply. That will be to everyone's benefit, because prices will come down. [Interruption.] No. I gave the hon. Member for Berwick-upon-Tweed (Mr. Beith) the answer, that the converse is possible. If we allow cherry-picking—where the best customer areas are taken away—the area boards will be left with rural customers and much the same overheads. The effect of that on rural customers would be increased prices. There would be a narrower customer base associated with much the same overheads. That would be bad for rural customers.
      I accept that there is a philosophical difference. We believe that competition will be in the direct interest of consumers. It will place a downward pressure on prices which will be a good thing for rural, as well as for urban, customers.
      The hon. Member for Orkney and Shetland (Mr. Wallace) assumed that the Government would invite the House to reject Lords amendment No. 8. In fact, we suggest that the House should accept that amendment. That is an important concession to the hon. Gentleman's argument and to the argument made in another place. In direct answer to the proposition made in respect of the regulator, I remind the hon. Gentleman that that amendment will require the regulator in carrying out his duties to take into account the interests of rural customers. That enormous concession on the Government's part directly meets some of the anxieties that have recently been expressed.
      I hope that hon. Members will think again on the basis of that major concession, although I agree that it does not completely meet the philosophical argument voiced by Opposition Members about competition, because the Government believe in competition, and competition runs right through the Bill.
      I do not wish to be presumptuous, but this may be the last occasion on which I shall have the honour of addressing the House on this matter, and it gives me great pleasure to reiterate the importance of competition. The abolition of the common tariff assumption is fundamental to our restructuring of the industry. We believe that that is fundamentally good and in the interests of consumers.
      I ask the House to reject the Lords amendments with the exception of Lords amendment No. 8.
      Question put, That this House doth disagree with the Lords in the said amendment:—
      The House divided: Ayes 291, Noes 194.

      Division No. 319]

      [9.46 pm

      AYES

      Adley, Robert

      Forth, Eric

      Alexander, Richard

      Fowler, Rt Hon Norman

      Alison, Rt Hon Michael

      Fox, Sir Marcus

      Allason, Rupert

      Franks, Cecil

      Amess, David

      Freeman, Roger

      Amos, Alan

      French, Douglas

      Arbuthnot, James

      Gale, Roger

      Arnold, Jacques (Gravesham)

      Gardiner, George

      Arnold, Tom (Hazel Grove)

      Garel-Jones, Tristan

      Ashby, David

      Gill, Christopher

      Atkins, Robert

      Glyn, Dr Alan

      Atkinson, David

      Goodlad, Alastair

      Baker, Nicholas (Dorset N)

      Goodson-Wickes, Dr Charles

      Banks, Robert (Harrogate)

      Gorman, Mrs Teresa

      Batiste, Spencer

      Gorst, John

      Beaumont-Dark, Anthony

      Gow, Ian

      Bellingham, Henry

      Grant, Sir Anthony (CambsSW)

      Bendall, Vivian

      Greenway, Harry (Eating N)

      Bennett, Nicholas (Pembroke)

      Greenway, John (Ryedale)

      Benyon, W.

      Gregory, Conal

      Bevan, David Gilroy

      Griffiths, Sir Eldon (Bury St E')

      Biffen, Rt Hon John

      Griffiths, Peter (Portsmouth N)

      Blackburn, Dr John G.

      Ground, Patrick

      Blaker, Rt Hon Sir Peter

      Gummer, Rt Hon John Selwyn

      Bonsor, Sir Nicholas

      Hague, William

      Boscawen, Hon Robert

      Hamilton, Neil (Tatton)

      Boswell, Tim

      Hampson, Dr Keith

      Bottomley, Mrs Virginia

      Hanley, Jeremy

      Bowden, A (Brighton K'pto'n)

      Hannam, John

      Bowis, John

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

      Boyson, Rt Hon Dr Sir Rhodes

      Hargreaves, Ken (Hyndburn)

      Braine, Rt Hon Sir Bernard

      Hayes, Jerry

      Brandon-Bravo, Martin

      Heathcoat-Amory, David

      Brazier, Julian

      Heddle, John

      Bright, Graham

      Hicks, Mrs Maureen (Wolv' NE)

      Brooke, Rt Hon Peter

      Higgins, Rt Hon Terence L.

      Brown, Michael (Brigg & Cl't's)

      Hill, James

      Browne, John (Winchester)

      Hind, Kenneth

      Bruce, Ian (Dorset South)

      Hogg, Hon Douglas (Gr'th'm)

      Budgen, Nicholas

      Holt, Richard

      Burns, Simon

      Hordern, Sir Peter

      Burt, Alistair

      Howard, Michael

      Butler, Chris

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

      Butterfill, John

      Howarth, G. (Cannock & B'wd)

      Carrington, Matthew

      Hughes, Robert G. (Harrow W)

      Cash, William

      Hunt, David (Wirral W)

      Chapman, Sydney

      Hunt, Sir John (Ravensbourne)

      Chope, Christopher

      Hunter, Andrew

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

      Hurd, Rt Hon Douglas

      Clark, Dr Michael (Rochford)

      Irvine, Michael

      Clarke, Rt Hon K. (Rushcliffe)

      Irving, Charles

      Conway, Derek

      Jack, Michael

      Coombs, Anthony (Wyre F'rest)

      Jackson, Robert

      Coombs, Simon (Swindon)

      Janman, Tim

      Cope, Rt Hon John

      Jessel, Toby

      Couchman, James

      Johnson Smith, Sir Geoffrey

      Cran, James

      Jones, Gwilym (Cardiff N)

      Currie, Mrs Edwina

      Jones, Robert B (Herts W)

      Curry, David

      Jopling, Rt Hon Michael

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

      Kellett-Bowman, Dame Elaine

      Davis, David (Boothferry)

      Key, Robert

      Day, Stephen

      Kilfedder, James

      Dorrell, Stephen

      King, Roger (B'ham N'thfield)

      Douglas-Hamilton, Lord James

      Kirkhope, Timothy

      Dover, Den

      Knapman, Roger

      Dunn, Bob

      Knight, Greg (Derby North)

      Durant, Tony

      Knight, Dame Jill (Edgbaston)

      Evans, David (Welwyn Hatf'd)

      Knowles, Michael

      Fairbairn, Sir Nicholas

      Lamont, Rt Hon Norman

      Fallon, Michael

      Lang, Ian

      Favell, Tony

      Latham, Michael

      Fenner, Dame Peggy

      Lawrence, Ivan

      Field, Barry (Isle of Wight)

      Lawson, Rt Hon Nigel

      Fishburn, John Dudley

      Lee, John (Pendle)

      Fookes, Dame Janet

      Lennox-Boyd, Hon Mark

      Forman, Nigel

      Lester, Jim (Broxtowe)

      Forsyth, Michael (Stirling)

      Lightbown, David

      823

      Lloyd, Sir Ian (Havant)

      Shaw, David (Dover)

      Lord, Michael

      Shaw, Sir Giles (Pudsey)

      Luce, Rt Hon Richard

      Shaw, Sir Michael (Scarb')

      Lyell, Sir Nicholas

      Shelton, Sir William

      McCrindle, Robert

      Shephard, Mrs G. (Norfolk SW)

      MacKay, Andrew (E Berkshire)

      Shepherd, Colin (Hereford)

      Maclean, David

      Shersby, Michael

      McLoughlin, Patrick

      Skeet, Sir Trevor

      McNair-Wilson, Sir Michael

      Smith, Sir Dudley (Warwick)

      McNair-Wilson, Sir Patrick

      Soames, Hon Nicholas

      Malins, Humfrey

      Speed, Keith

      Maples, John

      Speller, Tony

      Marlow, Tony

      Spicer, Sir Jim (Dorset W)

      Marshall, John (Hendon S)

      Spicer, Michael (S Worcs)

      Marshall, Michael (Arundel)

      Squire, Robin

      Martin, David (Portsmouth S)

      Stanbrook, Ivor

      Mates, Michael

      Stanley, Rt Hon Sir John

      Mawhinney, Dr Brian

      Stern, Michael

      Maxwell-Hyslop, Robin

      Stevens, Lewis

      Meyer, Sir Anthony

      Stewart, Allan (Eastwood)

      Miller, Sir Hal

      Stewart, Andy (Sherwood)

      Mills, Iain

      Stewart, Rt Hon Ian (Herts N)

      Miscampbell, Norman

      Stokes, Sir John

      Mitchell, Sir David

      Stradling Thomas, Sir John

      Moate, Roger

      Sumberg, David

      Monro, Sir Hector

      Summerson, Hugo

      Montgomery, Sir Fergus

      Tapsell, Sir Peter

      Moore, Rt Hon John

      Taylor, Ian (Esher)

      Morris, M (N'hampton S)

      Taylor, John M (Solihull)

      Morrison, Rt Hon P (Chester)

      Taylor, Teddy (S'end E)

      Moss, Malcolm

      Tebbit, Rt Hon Norman

      Moynihan, Hon Colin

      Temple-Morris, Peter

      Mudd, David

      Thompson, D. (Calder Valley)

      Neale, Gerrard

      Thompson, Patrick (Norwich N)

      Needham, Richard

      Thorne, Neil

      Nelson, Anthony

      Thornton, Malcolm

      Newton, Rt Hon Tony

      Thurnham, Peter

      Nicholls, Patrick

      Townend, John (Brldlington)

      Nicholson, David (Taunton)

      Townsend, Cyril D. (B'heath)

      Nicholson, Emma (Devon West)

      Tracey, Richard

      Norris, Steve

      Tredinnick, David

      Onslow, Rt Hon Cranley

      Trippier, David

      Oppenheim, Phillip

      Trotter, Neville

      Page, Richard

      Twinn, Dr Ian

      Paice, James

      Vaughan, Sir Gerard

      Parkinson, Rt Hon Cecil

      Viggers, Peter

      Patnick, Irvine

      Waddington, Rt Hon David

      Patten, Rt Hon Chris (Bath)

      Waldegrave, Hon William

      Patten, John (Oxford W)

      Walden, George

      Pawsey, James

      Walker, Bill (T'side North)

      Peacock, Mrs Elizabeth

      Waller, Gary

      Porter, Barry (Wirral S)

      Ward, John

      Portillo, Michael

      Wardle, Charles (Bexhill)

      Powell, William (Corby)

      Warren, Kenneth

      Price, Sir David

      Wells, Bowen

      Raffan, Keith

      Wheeler, John

      Raison, Rt Hon Timothy

      Whitney, Ray

      Redwood, John

      Widdecombe, Ann

      Renton, Tim

      Wiggin, Jerry

      Rhodes James, Robert

      Winterton, Mrs Ann

      Riddick, Graham

      Winterton, Nicholas

      Ridsdale, Sir Julian

      Wolfson, Mark

      Rifkind, Rt Hon Malcolm

      Wood, Timothy

      Roberts, Wyn (Conwy)

      Woodcock, Dr. Mike

      Roe, Mrs Marion

      Yeo, Tim

      Rossi, Sir Hugh

      Young, Sir George (Acton)

      Rost, Peter

      Rowe, Andrew

      Tellers for the Ayes:

      Rumbold, Mrs Angela

      Mr. Kenneth Carlisle and Mr. Tom Sackville.

      Sayeed, Jonathan

      Scott, Rt Hon Nicholas

      NOES

      Abbott, Ms Diane

      Ashdown, Rt Hon Paddy

      Adams, Allen (Paisley N)

      Ashley, Rt Hon Jack

      Allen, Graham

      Ashton, Joe

      Alton, David

      Banks, Tony (Newham NW)

      Anderson, Donald

      Barnes, Harry (Derbyshire NE)

      Archer, Rt Hon Peter

      Barnes, Mrs Rosie (Greenwich)

      Armstrong, Hilary

      Barron, Kevin

      824

      Battle, John

      Hood, Jimmy

      Beckett, Margaret

      Howarth, George (Knowsley N)

      Beith, A. J.

      Howell, Rt Hon D. (S'heath)

      Benn, Rt Hon Tony

      Hoyle, Doug

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

      Hughes, John (Coventry NE)

      Bermingham, Gerald

      Hughes, Robert (Aberdeen N)

      Bidwell, Sydney

      Hughes, Roy (Newport E)

      Blair, Tony

      Hughes, Simon (Southwark)

      Boateng, Paul

      Illsley, Eric

      Boyes, Roland

      Ingram, Adam

      Bradley, Keith

      Janner, Greville

      Bray, Dr Jeremy

      Johnston, Sir Russell

      Brown, Nicholas (Newcastle E)

      Jones, Barry (Alyn & Deeside)

      Bruce, Malcolm (Gordon)

      Jones, Martyn (Clwyd S W)

      Buckley, George J.

      Kennedy, Charles

      Caborn, Richard

      Kinnock, Rt Hon Neil

      Callaghan, Jim

      Kirkwood, Archy

      Campbell, Menzies (Fife NE)

      Lamond, James

      Campbell, Ron (Blyth Valley)

      Leighton, Ron

      Campbell-Savours, D. N.

      Lewis, Terry

      Canavan, Dennis

      Litherland, Robert

      Cartwright, John

      Lloyd, Tony (Stretford)

      Clark, Dr David (S Shields)

      Lofthouse, Geoffrey

      Clarke, Tom (Monklands W)

      McAllion, John

      Clay, Bob

      McAvoy, Thomas

      Clelland, David

      McCartney, Ian

      Clwyd, Mrs Ann

      Macdonald, Calum A.

      Cohen, Harry

      McKelvey, William

      Coleman, Donald

      McLeish, Henry

      Cook, Robin (Livingston)

      Maclennan, Robert

      Corbett, Robin

      McWilliam, John

      Corbyn, Jeremy

      Madden, Max

      Cousins, Jim

      Mahon, Mrs Alice

      Cox, Tom

      Martin, Michael J. (Springburn)

      Cryer, Bob

      Meacher, Michael

      Cummings, John

      Meale, Alan

      Cunliffe, Lawrence

      Michael, Alun

      Darling, Alistair

      Michie, Bill (Sheffield Heeley)

      Davies, Rt Hon Denzil (Llanelli)

      Michie, Mrs Ray (Arg'l & Bute)

      Davies, Ron (Caerphilly)

      Mitchell, Austin (G't Grimsby)

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

      Morgan, Rhodri

      Dewar, Donald

      Morris, Rt Hon A. (W'shawe)

      Dixon, Don

      Morris, Rt Hon J. (Aberavon)

      Dobson, Frank

      Mowlam, Marjorie

      Doran, Frank

      Mullin, Chris

      Duffy, A. E. P.

      Murphy, Paul

      Dunnachie, Jimmy

      Nellist, Dave

      Dunwoody, Hon Mrs Gwyneth

      Oakes, Rt Hon Gordon

      Eadie, Alexander

      O'Brien, William

      Eastham, Ken

      Patchett, Terry

      Ewing, Harry (Falkirk E)

      Pendry, Tom

      Ewing, Mrs Margaret (Moray)

      Pike, Peter L.

      Fatchett, Derek

      Powell, Ray (Ogmore)

      Fearn, Ronald

      Primarolo, Dawn

      Fisher, Mark

      Quin, Ms Joyce

      Flannery, Martin

      Radice, Giles

      Flynn, Paul

      Randall, Stuart

      Foot, Rt Hon Michael

      Redmond, Martin

      Foster, Derek

      Richardson, Jo

      Fraser, John

      Roberts, Allan (Bootle)

      Galloway, George

      Robinson, Geoffrey

      Garrett, John (Norwich South)

      Rogers, Allan

      Garrett, Ted (Wallsend)

      Ross, Ernie (Dundee W)

      Gilbert, Rt Hon Dr John

      Rowlands, Ted

      Godman, Dr Norman A.

      Ruddock, Joan

      Golding, Mrs Llin

      Salmond, Alex

      Gordon, Mildred

      Sedgemore, Brian

      Gould, Bryan

      Sheldon, Rt Hon Robert

      Graham, Thomas

      Shore, Rt Hon Peter

      Grant, Bernie (Tottenham)

      Short, Clare

      Griffiths, Nigel (Edinburgh S)

      Skinner, Dennis

      Griffiths, Win (Bridgend)

      Smith, Andrew (Oxford E)

      Grocott, Bruce

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

      Hardy, Peter

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

      Haynes, Frank

      Smith, J. P. (Vale of Glam)

      Henderson, Doug

      Soley, Clive

      Hinchliffe, David

      Spearing, Nigel

      Hoey, Ms Kate (Vauxhall)

      Steinberg, Gerry

      Hogg, N. (C'nauld & Kilsyth)

      Stott, Roger

      Home Robertson, John

      Straw, Jack

      825

      Taylor, Mrs Ann (Dewsbury)

      Welsh, Michael (Doncaster N)

      Taylor, Matthew (Truro)

      Williams, Rt Hon Alan

      Thompson, Jack (Wansbeck)

      Williams, Alan W. (Carm'then)

      Turner, Dennis

      Wilson, Brian

      Vaz, Keith

      Winnick, David

      Wall, Pat

      Wise, Mrs Audrey

      Wallace, James

      Worthington, Tony

      Walley, Joan

      Young, David (Bolton SE)

      Warden, Gareth (Gower)

      Wareing, Robert N.

      Tellers for the Noes:

      Watson, Mike (Glasgow, C)

      Mr. Frank Cook and Mr. Allen McKay.

      Welsh, Andrew (Angus E)

      Question accordingly agreed to.
      Lords amendment No. 8 agreed to.
      Lords amendments Nos. 23 and 24 disagreed to.
      Committee appointed to draw up Reasons to be assigned to the Lords for disagreeing to their amendments Nos. 1, 21, 23, 24 and 81 to 89: Mr. Kevin Barron, Mr. David Heathcoat-Amory, Mr. Ian Lang, Mr. John Maxton and Mr. Michael Spicer. Three to be the quorum—[Mr. Heathcoat-Amory.]
      To withdraw immediately.
      Reasons for disagreeing to certain of the Lords amendments reported, and agreed to: to be communicated to the Lords.

  PETITIONS

    East London Assessment Studies
    10.2 pm
    Mr. Jeremy Corbyn: I wish to present a petition on behalf of my constituents and those of my hon. Friends the Members for Islington, South and Finsbury (Mr. Smith), for Hackney, North and Stoke Newington (Ms. Abbott), and for Hackney, South and Shoreditch (Mr. Sedgemore), and of those in neighbouring constituencies. I am constrained by the rules of the House in not being able to read out all 24 petitions. They relate to the east London assessment studies, which have among their proposals the driving of a major road through north and east London. There are also separate petitions protesting about the construction of an Archway motorway through the constituency of Hornsey and Wood Green and extending into my constitency of Islington, North.
    I shall read one of the petitions as an example of local residents' concern about road building. It is one that I wholeheartedly endorse, as do my hon. Friends who are here this evening. It says:
    To the Honourable the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled.
    The Humble Petition of residents of Corsica Street, Calabria Road, Liberia Road, Gallia Road, Fergus Road and Grosvenor Avenue in Islington, London N.5,
    Sheweth that there is an East London Assessment Study, commissioned by Her Majesty's Department of Transport, which proposes a number of solutions to the problems of transport in North and East London, among which is the building of new roads.
    Wherefore your Petitioners pray that your honourable House will urge the Secretary of State for Transport to take note that: We, the undersigned, are greatly concerned at the proposals of the East London Assessment Studies to build new roads in Islington. We feel that road building is not a permanent solution, is wasteful and damaging, destroying our communities and our environment. We would like to see greater emphasis on traffic management schemes, more expenditure on public transport and encouragement to use it, with the aim of reducing the amount of traffic on London's roads rather than increasing it. We demand a transport policy which safeguards the quality of our environment and gives weight to the needs of residents, pedestrians, cyclists rather than just the motorist.
    And your Petitioners, as in duty bound, will ever pray, &c. That is supported by 23 other petitions, which contain similar demands, and are signed by more than 3,000 people. I wholeheartedly support them.
    To lie upon the Table.

  Midwives (Leicester)
  10.4 pm
  Mr. Keith Vaz: I wish to present a petition on behalf of sister Millington and staff nurse Baird of 14C, Hospital close, Leicester, staff midwife Katrina Barnett of 7B Hospital close, Leicester and 23 other midwives at Leicester general hospital in Evington who were outraged last week when Leicestershire health authority announced that midwives at the Leicester royal infirmary were to get incentive payments of £1,000 each.
  The midwives at the general hospital were prepared to resign en masse. They believe that all midwives in Leicestershire should be treated equally and I understand

  827
  that since the petition was raised the health authority has now agreed to extend the payments to the Leicester general hospital.
  The midwives consider that the crisis of staff shortages, which at the general hospital means overtime payments for 480 hours a month, can be solved only by a proper salary regrading and not by the application of auction-like tactics to our Health Service.
  Wherefore your Petitioners pray that your Honourable House encourage the Secretary of State for Health to instruct the Leicestershire health authority to review the salary structure of midwives in the district.
  To lie upon the Table.

  Channel Tunnel (Rail Link)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Kenneth Carlisle.]
  10.5 pm
  Mr. Bob Dunn: I am most appreciative of the opportunity to discuss the implications of the high-speed rail link for north-west Kent. I am most grateful to my hon. Friend the Minister of State for the time that he has spent previously and will spend tonight in debating this issue with me.
  I am also grateful for the company of some of my right hon. and hon. Friends who represent the county of Kent—my right hon. Friend the Member for Tonbridge and Mailing (Sir J. Stanley), my hon. Friends the Members for Sevenoaks (Mr. Wolfson), for Medway (Dame P. Fenner), for Mid-Kent (Mr. Rowe) and for Gravesham (Mr. Arnold) and also for the company of my right hon. Friend the Member for Brent, North (Sir R. Boyson), who takes a great interest in this matter.
  It would be wrong for me to let the opportunity pass without placing on record the thanks of Members representing Kent to our right hon. Friend the Member for Southend, West (Mr. Channon) who today left office at the Department of Transport. He was at all times a most perfect gentleman and an extremely courteous Minister with whom to deal. I also welcome to that post my right hon. Friend the Member for Hertsmere (Mr. Parkinson) who, I dare say, will meet us soon to discuss the vexed problem that faces my constituents and those of other Members who represent Kent.
  I also pay tribute to the many hundreds, if riot thousands, of my constituents who have suffered for a year stress and anxiety, personally and collectively, caused by the wretched proposals that have been brought forward, I believe inadvisedly, by British Rail.
  I speak for the constituency of Dartford and the five communities within it, South Darenth and Horton Kirby, Sutton at Hone, Longfield, New Barn and Southfleet, which are the most severely affected by the proposals to construct a high-speed rail link in and through Dartford.
  Those communities are the most affected and yet, thus far, they appear to be receiving least help. Of all parts of the track, that part that I represent, the area roughly between the M25 and Istead Rise, is worse off today in terms of the impact, stress and damage of the proposals than even a month ago following the significant concessions made at the portals at Swanley and the lesser concession made to the portal placement at Istead Rise.
  It is clear that the high-speed rail link has no benefits for the people of north-west Kent or the commuters of Dartford who face the most difficult and badly administered service within Network SouthEast, the Dartford line. It is indisputable that those of us in the House or those representing the county council, the borough and district councils, the parish councils or the various community-based action groups have found it difficult, if not impossible, to obtain the range of information from British Rail about the route and all its implications in order that we, the people of Kent, can properly evaluate the options available to us. These proposals will massively damage the people of Kent, socially, economically and environmentally, and British Rail has not responded as constructively as it might have to our request.

  829
  Tunnelling is clearly the main answer to our difficulty. British Rail has told us that the cost of tunnelling between Swanley—or the M25—and Istead Rise would be £410 million, as opposed to £289 million for constructing a surface line. So the difference between the two options means that, as at June 1989, tunnelling would cost £121 million more than a surface line.
  British Rail has admitted of late that its opposition to tunnelling is based largely, if not solely, on the cost. In my view, direct tunnelling would save £20 million, thus reducing the gap to £100 million. Further, British Rail appears to have assumed London, not Kent, tunnelling costs for the mere five miles of tunnel between the M25 and Istead Rise, as the track goes through Dartford. This is important, because the substrata of London are a ragbag of ingredients—some sand, some clay and some other admixtures—whereas tunnelling through Dartford would go through good-quality chalk. Kent tunnelling costs are cheaper per mile than London costs. Taking that into account and bearing in mind that we have been given no idea of likely expenditure on environmental protection, the tunnelling option for Dartford becomes much more attractive and must be seriously taken into account by British Rail and by the House and the Department of Transport.
  Mr. Mark Wolfson: I am sure that these suggestions do not come only from my hon. Friend's head: they will have been based on the views of consultants who are experts in their field.
  Mr. Dunn: This point comes not only from me but from consultants, action groups and British Rail. It is an accurate point and it must be taken into account by British Rail.
  My constituency faces further problems on the environmental front, caused by the potential placement of construction sites in Sutton at Hone and in other sites in and around New Barn. I refer to the movement of spoil. The A225 to Farningham, and perhaps into Dartford, will become a major route carrying a potential 2,000 vehicle movements a day, removing spoil from the construction site.
  The same applies to the construction sites liable to be placed near the New Barn road between communities of Istead Rise and New Barn itself. We face the problems of the movement of spoil for at least six years after the passage of the legislation. Three million tonnes of the materials necessary for construction need to be moved to Kent, and about 15 million tonnes of spoil need to be moved out.
  Our county faces a major problem of environmental survival. We would not be thanked by those who will come after us if we did not expect the House, the Government and the Department of Transport to recognise the anxieties that I have advanced and that my hon. Friends, if they catch your eye, Mr. Speaker, will also discuss.
  There is a problem for the farmer and the business man and for elderly people living in private rented accommodation. All those aspects need to be covered and, yet a mere 15 weeks from the presentation of the Bill we are no wiser than we were last week or last month in terms of getting information from British Rail. The only option for north-west Kent is tunnelling.
  Dame Peggy Fenner: British Rail is already tunnelling through the village of Hailing in my constituency. It has to do that because the tunnel is under the north downs. British Rail is proposing a viaduct over the Medway. We already have five crossings of the Medway and another would create a visual impact that one should not expect. The Medway towns are among the most highly populated in the area and every scrap of the environment that is not urban environment is vital. In such parts of Kent, tunnelling is the answer. We need to consider the cost, but it should not be considered before the environment. I seek an assurance from my hon. Friend the Minister that the environment will come first. This link will be for always and the people of Kent should not be asked to shoulder the burden of a spoilt environment.
  Mr. Dunn: I am grateful to my hon. Friend for her contribution. She makes the point more effectively than I could have done.
  We have not been well used by British Rail in this matter. We are anxious to ensure that the project is right, from its start on the Kent coast to its termination in the centre of London. I raise these matters because they must be dealt with now. Perhaps my hon. Friend the Minister will not be able to say much now, but it would be wrong of me to allow the House to go into the summer recess without placing on record my concern about my constituents and the general concern that we all have for the future of the county of Kent.
  10.17 pm
  Mr. Jacques Arnold: I pay tribute to my hon. Friend the Member for Dartford (Mr. Dunn) for initiating this debate. He is a tireless champion on behalf of his constituents who are perhaps now the most seriously affected by the British Rail proposals. He and I share the representation of the village of New Barn which remains exposed to the line, albeit in deeper cutting. Bringing complete protection to that village could be achieved either by constructing the line via the progressive working of cut and cover or by extending the bore from Thirty-Acre Shaw to beyond the New Barn road. That would be a great improvement and would also benefit my constituents at Istead Rise.
  Another advantage of carrying out construction in this manner would be that the necessary construction sites would be moved further westward saving both lstead Rise and Southfleet from such disturbance and from the removal of spoil which could be taken northwards on the disused railway line. Not least among that spoil would be high-quality chalk which could be taken to the Northfleet cement works. If implemented, the proposals would lead to a desecration of the beautiful Kentish countryside in north-west Kent, and lip service to the environment will not be enough.
  10.19 pm
  Sir John Stanley (Tonbridge and Mailing): I thank my hon. Friend the hon. Member for Dartford (Mr. Dunn) for allowing me one minute of his precious time in this Adjournment debate. I have three points to put to my hon. Friend the Minister. First, will he continue to urge British Rail to listen to the people of north-west and mid-Kent, and will he in particular urge it to consider the real environmental concerns expressed by my hon. Friends the Members for Dartford and for Medway (Dame P. Fenner)

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  and others? In particular, the section between the River Medway and the A229 road is still not acceptable environmentally and I hope that my hon. Friend will continue to register that with British Rail.
  Secondly, will my hon. Friend the Minister resist any attempt by British Rail to get for itself deemed planning consent for the Mid-Kent Parkway station through the private Bill procedure. That development should be the subject of formal planning procedures and it would be an abuse to seek planning consent through the private Bill procedure.
  Thirdly, will my hon. Friend urge British Rail to take more seriously the profound noise disturbance that is likely to be created on existing railways from transcontinental freight trains? British Rail can take steps with various acoustic baffling devices and so on to mitigate the noise disturbance on the designated freight routes and it should do so.
  10.20 pm
  Mr. Andrew Rowe (Mid-Kent): It would appear that the only way that I can get tunnelling in any part of my constituency is if there is a motorway service area, because it is more important to protect such areas than it is to protect real people. Kent is bruised by what I think are the dying throes of a dinosaur—the private Bill procedure which was invented to enable 19th century railway entrepreneurs to build a railway. It is a quite inappropriate procedure for building modern railways. Some 19,000 miles of railway are projected to be built within the European Community between now and the end of the century. It is a major part of the transport provision, and it is inappropriate for it to be excluded and treated wholly separately. I understand why the Government step back from this, but it cannot continue.
  We need to look closely—not only for our county but for all the counties affected by future railway building—at compensation. It would be disgraceful if farms were to be expropriated at market value, and later British Rail was able to claim a major capital gain by selling the land back at an inflated price. I hope that my hon. Friend will take that point on board.
  Secondly, it would be inappropriate for Kent county council to have to carry all the costs of access to the Mid-Kent Parkway station, which has been foisted on it in contravention of its county structure plan. I hope that my hon. Friend the Minister will agree that British Rail should contribute to the cost.
  Thirdly, I echo what has been said by my right hon. Friend the Member for Tonbridge and Mailing (Sir J. Stanley) about noise. The noise intensification of enormous freight trains running all through the night instead of occasional freight trains once or twice a night requires that compensation and protection should be available not only to the people of Kent, but, as this enormous explosion in freight being carried by rail spreads across the country, to the whole country. It is essential that my hon. Friend should give us some consolation on this matter.
  10.23 pm
  The Minister for Public Transport (Mr. Michael Portillo): I do not remember an Adjournment debate in which six of my right hon. and hon. Friends have spoken and that is a testimony to the great importance of this
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  subject in the county of Kent. I begin by congratulating my hon. Friend the Member for Dartford (Mr. Dunn) on having had the chance to initiate this Adjournment debate, and thank him for doing so. He has been assiduous in pursuing the interests of his constituents and I can fairly say that barely a day has gone past in recent months without my hon. Friend taking an opportunity to let me know his latest concerns and to press me further to see what I can do to soften the blow of this proposed project on his constituency.
  My hon. Friend will not mind if I pay tribute to my other right hon. and hon. Friends who have spoken because they have also been most pressing on Ministers and British Rail in trying to achieve the best for their constituents. I thank my hon. Friend for his generous words about my right hon. Friend the Member for Southend, West (Mr. Channon), who cares deeply about these matters. His mind was deeply engaged on how the project could best be carried forward with justice being done for all concerned. I know that my right hon. Friend the Member for Hertsmere (Mr. Parkinson), the Secretary of State for Transport, will be only too keen that I should brief him as quickly as possible on the matters that have been discussed between my hon. Friend and I over recent months.
  I wish my right hon. and hon. Friends to be aware of the tremendous influence that they have had already on the matters that we are discussing. I do not wish them at any time to downplay that. They are all aware that important changes have been made to the proposal. I understand that they wish the changes to go further, but the changes are important and many of them have been largely because of the pressure that my right hon. and hon. Friends have sustained over a long period. They all know that the cost of the project now, at £1·7 billion, includes a large sum—probably about £500 million—that has been provided entirely for environmental protection.
  Even since the project was launched in March with the new proposals and the rather higher price tag, extra costs have been allowed to mount. It has been announced that the tunnelling will be somewhat longer than in the original March project. The extra tunnelling costs amount to £53 million, inclusive of property purchase and resale, to extend the London tunnel beyond the M25 and to move the portal of the north downs tunnel further west to the A227. These changes have arisen largely because of the pressure of my right hon. and hon. Friends.
  My hon. Friend the Member for Dartford thinks that the least help has been given to his constituency. To some extent I would dispute that. He will know that there have been important changes in his constituency as well as in others. For example, the viaduct that was originally to have run to the north of the existing railway will now run through the south, so saving about 80 properties and removing the need to take part of the gardens of 70 properties. British Rail is still considering the height of the viaduct and what would be suitable there.
  I ask my right hon. and hon. Friends—and I know that this is extremely difficult for them—to keep some sense of proportion in these matters. We are talking about a project that will result in trains running through Kent. They are not new monsters. Again, partly due to pressure by my right hon. and hon. Friends, the maximum speed of the trains will be about 140 mph or maybe 145 mph. It will not be the 186 mph that was proposed originally. The speed at which they will run will be fairly comparable to the speeds

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  of trains operating now, or that may operate shortly. With new technology, these trains may not be any noisier than present trains. Indeed, they may be a little quieter. In a number of instances we are talking about them passing close to villages which trains already pass. I do not want to play down the difficulties that are being experienced in the constituencies of my right hon. and hon. Friends. I merely ask them to maintain some sense of proportion, if they are able to do so.
  My hon. Friend the Member for Dartford talked about lack of certainty at this stage. As I have said to him on a number of occasions, people in Kent want certainty so that they know whether they are affected by the scheme. On the other hand, they want genuine consultation. It is extremely difficult to have certainty and real consultation. I think that to some extent my right hon. and hon. Friends may have been surprised by the extent to which British Rail has been willing since the March date to consider different proposals, and I am sure that at least some of the changes have been welcomed.
  There is obviously a dispute between my hon. Friend the Member for Dartford and British Rail about the cost of tunnelling and what would be the extra cost of putting the tunnel all the way through his constituency. The latest figure I have as British Rail's estimate of the cost of the longer tunnel compared with the preferred route is £122 million—which my hon. Friend disputes. I take the view that my hon. Friend's points should be exhaustively examined by British Rail and that he should be given satisfactory answers to them all.
  Mr. Dunn: Perhaps my hon. Friend the Minister will allow me to correct him. The figure I used as being the difference in cost between tunnelling and laying a track on the surface was, to be pedantic, £121·6 million. I then knocked off from that figure other cost benefits that would accrue.
  Mr. Portillo: Very well. I did not mean to misrepresent my hon. Friend in any way. In any event, he arrived at a different net figure, and his arguments should be exhaustively addressed. He will appreciate that if, after examination, the net cost of tunnelling is found to be very large, obviously British Rail will be reluctant to adopt his proposal. The project, at one point estimated to cost £7 billion, is less viable than when it was estimated to be considerably less. British Rail is concerned to complete the project, because it believes strongly in the provision of a new rail link across Kent and to London, to the benefit of the entire country, but it is concerned also to ensure that that project will be viable.
  My hon. Friend the Member for Dartford is concerned also about the movement of spoil and about the construction site. Such matters are often discussed during the passage of a private Bill, and I hope that it will be possible to reach an accommodation either during the passage of the Bill or in discussions beforehand.
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  I noted carefully the short interventions of my hon. Friends the Members for Gravesham (Mr. Arnold) and for Medway (Dame P. Fenner), and my right hon. Friend the Member for Tonbridge and Mailing (Sir J. Stanley) raised a number of specific points. My right hon. Friend wants me to guarantee that British Rail will continue listening to the people of Kent. I hope that the tone of my remarks this evening leads him to believe that my view is that British Rail should do so, and there are a number of examples of British Rail's willingness to adapt its proposals to take account of the views expressed.
  My right hon. Friend is concerned that the private Bill procedure should not be used as a means of obtaining planning permission in respect of issues far wider than simply the Mid-Kent Parkway station itself. I agree with him. It is implicit in British Rail's approach that it wants to discuss the wider planning implications of Mid-Kent Parkway station with Kent county council. While recognising that that will create difficulties in respect of the structure plan, Kent county council is at least content with that method of proceeding.
  As to noise disturbance on existing routes, of course there is always the risk, if one lives near a railway or road, that more intensive use will be made of it as time passes. My right hon. Friend appreciates, I am sure, that it is difficult to compensate people for such changes. He asked me about specific physical measures, and I shall certainly raise that aspect with British Rail.
  Mr. Wolfson: I appreciate the point made by my hon. Friend the Minister concerning increased rail activity over a period of time, but the difference in this case is that there will be a rapid marked increase in activity only two or three weeks after the tunnel is opened. The change will be dramatic.
  Mr. Portillo: I am not so sure about that. I suppose that there will be a change when the tunnel is opened, but it might take some time for the freight to build up. In any case, I am not sure that there would not be analogies in other areas. Compensating people for changes in intensity of use is a difficult subject, but I note what my hon. Friend says.
  My hon. Friend the Member for Mid-Kent (Mr. Rowe) believes that the private Bill procedure is inappropriate. He will be aware that for the moment no other procedure is available for the building of a railway line. He raised what I hope he will forgive me for describing simply as a big subject—compensation. Not only my Department but the Department of the Environment will want to consider his remarks carefully. My hon. Friend also raised a point about the Mid-Kent Parkway station. That is a matter appropriate for discussion between Kent county council and British Rail, who are proceeding on that basis.
  I thank my right hon. and hon. Friends for their great courtesy in raising these matters. I congratulate them on the meticulous way in which they have always represented the interests of their constituents.
  Question put and agreed to.
  Adjourned accordingly at twenty-six minutes to Eleven o'clock.