Privatisation

HC Deb 11 May 1992 vol 207 cc374-466

Madam Speaker

Before the debate begins, I should inform the House that many hon. Members wish to speak. Therefore, I shall impose a 10-minute limit between 7 pm and 9 pm. I hope that hon. Members who speak before 7 pm will place a voluntary restriction on their speeches.

3.33 pm

The Chancellor of the Duchy of Lancaster (Mr. William Waldegrave)

Like the hon. Member for Ogmore (Mr. Powell), this is my first opportunity to congratulate you, Madam Speaker, on your historic victory. I do so most warmly. Legend says that it was a member of my family who was the first to be dragged to your Chair. He had some excuse since the black death prevailed at the time. It would have taken the combined forces of a great many hon. Members to keep you, Madam Speaker, away from the Chair, which you will decorate for many more years than my ancestor did.

I welcome the theme that has been agreed with the Opposition for today's debate on the Loyal Address. Privatisation, nationalisation and denationalisation go to the heart of the differences between us and the Opposition about how government should be conducted.

1 shall seek to persuade the House of three propositions. The first is that the theory of politics and government which had nationalisation at its heart is dead in Britain and around the world. It was a theory with high ideals, but it failed. Secondly, I shall attempt to show that the remaining privatisation measures that the Government will introduce fit into a much wider vision of the relationship between the citizen and the state which provides the link between a wide range of the policies outlined in the Gracious Speech and which will dominate the work of this Session and the Sessions in years to come.

Thirdly, I shall argue that the death of the old, socialist approach to government—here and abroad—and its replacement by the new ideas adopted in this country by the Conservatives represents a political sea change, the significance of which is not yet fully understood by the Opposition parties or by those who write about politics from the old perspective.

I shall deal first with the rise and fall of the idea of nationalisation. It mirrors and parallels the rise and fall in the previous century of socialism itself. Its purpose was clear: its proponents were idealistic, but their policy failed and had very damaging consequences for industry and for citizens and Government alike. A century ago, the belief was that if democratic Governments took control of industry and commerce—either all of it or what the Opposition used to call "its commanding heights"—we should all benefit from sharing the control—

Mr. David Winnick (Walsall, North)

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Mr. Dennis Skinner (Bolsover)

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Mr. Tony Banks (Newham, North-West)

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Mr. Waldegrave

It is nice to see so many hon. Members wishing to join in. I cannot resist the hon. Member for Newham, North-West (Mr. Banks).

Mr. Banks

Will the right hon. Gentleman explain how taking over bankrupt railways and bankrupt mines was a failure of socialism? In fact, it was the failure of capitalism that required Labour Governments to take them over.

Mr. Waldegrave

Yes, I shall explain exactly that. I am grateful to the hon. Gentleman for listening with such attention. As the hon. Gentleman says, the belief was that we should all benefit if industries that were, in many cases, declining or in bad shape were taken over and subject to democratic control by this House. It was believed that all the workers would gain from better pay and conditions, and the state would use its power of taxation and its power of privileged borrowing to invest for the future. They were the ideals. They were honourable ideals, and no one should doubt that, but they were objectives that have been shown by events to have failed. I argue today that their failure did immeasurable damage not only to the industries involved but to the state itself in the process.

Mr. Geoffrey Dickens (Littleborough and Saddleworth)

Does not my right hon. Friend think that we should be telling the House and the country that under the previous Labour Government, when companies were nationalised, they were inefficient and the taxpayers had to shovel billions of pounds down the drain year in and year out, but that today the same companies—after privatisation—are contributors to the Treasury and that they are efficient?

Mr. Waldegrave

That is one of the powerful arguments which my hon. Friend is right to deploy, and I shall also deploy it.

Democratic control did not lead to the planning of industries for everyone's benefit. What happened was that the centralisation of huge concentrations of industrial power in Whitehall led all too often to the capture of Whitehall by the very vested interests that the policy was meant to control. Departments became prisoners of the huge industrial interests that used Government power to try to preserve themselves, too often regardless of the needs of the consumer. Instead of the state investing for the future, revenues earned by the private sector—as my hon. Friend the Member for Littleborough and Saddleworth (Mr. Dickens) said—were used for ever more expensive attemptes to prop up yesterday's industries. Civil servants and politicians—

Mr. Winnick

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Mr. Robert Hughes (Aberdeen, North)

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Mr. Waldegrave

Two hon. Members are volunteering and I shall give way to them in a moment.

Civil servants and politicians were cast in roles for which they were unsuited, trying to replace the infinitely complex judgments of the markets and to second-guess industrial managers. I give way to the hon. Member on the right.

Mr. Winnick

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Mr. Hughes

I am on the right; my hon. Friend is on my left. To follow the right hon. Gentleman's argument to its conclusion, will he give an absolutely specific pledge today that the people who are apparently in such a precarious financial position with Canary wharf will receive no help or benefit of any kind from the state to bail them out?

Mr. Waldegrave

I shall not comment on the specific case. My argument is not that there should not in certain cases be partnership between industry and Government —there should—but that the enterprise of bringing into the corridors of power the most old-fashioned parts of our centralised industrial structure was catastrophic for the industries and for Whitehall.

Mr. Winnick

Will the right hon. Gentleman give way?

Mr. Hughes

Will the right hon. Gentleman give way?

Mr. Waldegrave

No. The judgment of Solomon is too great, and I must refuse both hon. Gentlemen now.

Often the industries inevitably became caught up in macro-economic policy decisions, often to the detriment of sensible investment. I have heard the hon. Member for Kingston upon Hull, East (Mr. Prescott) eloquently argue that. It was inevitable that they should, if they were part of the state. They were used as levers to try to steer the economy. The most catastrophic example of that was the great capital spending massacre of 1976–77 forced on the Labour Government by the International Monetary Fund.

Mr. Winnick

Will the right hon. Gentleman give way?

Mr. Waldegrave

With respect, I shall proceed.

Far from the workers benefiting, industrial relations were worse than in the private economy, as both Lord Callaghan and my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) have good reason to remember. What is more, the lack of individual shareholders concentrated power rather than dispersed it.

At the end of this whole doomed detour all that resulted was that the state was seen by the citizen as the incompetent owner of huge, often inefficient, out-of-date industries and as the protector of powerful producer interests, rather than as the champion of the citizen.

Mr. Winnick

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Mr. Waldegrave

The hon. Gentleman has been patient, and I give way.

Mr. Winnick

Is it not the case that before 1979 Conservative Governments accepted that basic industries and utilities should be in public ownership and that there was no dispute over that? Indeed, on occasions, a Conservative Government extended public ownership. Therefore, is it not the case that, although Mrs. Thatcher departed, for reasons we know and understand, in the coup of nearly two years ago, to a large extent her policies remain?

Mr. Waldegrave

The hon. Gentleman does not recognise the extent of the change in political ideas that has taken place, including among many in his party. There were, indeed, some Conservatives who accepted some of the programme of that socialist century. I think it was His Majesty King George V who said, "We are all socialists now". None of us is a socialist now, including many on the Labour Benches.

Sir Michael Marshall (Arundel)

Does my right hon. Friend agree that surely it was the extension into international manufacturing industries, such as steel and aerospace, that began to show the peculiar problems that nationalisation brought and the way in which Whitehall could kill our place in world markets?

Mr. Waldegrave

I agree with my hon. Friend. Nationalisation was pleasurable for politicians here and for civil servants.

If I may detain the House briefly with an anecdote, my first job as a junior civil servant was to observe the workings of a committee of civil servants which was settling once and for all what the steel production of the country should be. Was it to be 100 million tonnes, 120 million or 180 million? What an extraordinary thing to be doing. The fact that inevitably those decisions were wrong led to investment that ruined people's lives because they were misled into thinking that this House or Whitehall could preserve jobs that did not exist in the market.

Mr. D. N. Campbell-Savours (Workington)

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Mr. Waldegrave

I must proceed a little, but I will always debate with the hon. Gentleman.

Mr. Campbell-Savours

If it were not for the principle of public ownership, would there be a nuclear industry in this country today?

Mr. Waldegrave

Some believe that that industry above all has suffered and perhaps been given an extra-privileged position by its closeness to state decision taking over the years. The hon. Gentleman has been a brave defender of that industry, and he is right to be because it will be needed again. The nuclear industry has not benefited from that closeness.

Mr. Campbell-Savours

But would it be here?

Mr. Waldegrave

The answer is clearly yes. Other countries, such as the United States, have a nuclear industry in the private sector. I agree with the hon. Gentleman in that I very much doubt that the original research would have been done without Government support. That is a different matter.

Democracy itself was established in full only at the beginning of this century, with the ideal of its being the protector and representative of the ordinary citizen. Democracy was no sooner fully established than it was distorted by a single idea—the disastrous attempt to make the state the production manager over a massive range of goods and services. If a single idea mirrored and paralleled the rise of the Labour party in Britain, it was the idea of a massive bureaucratic, managerial state. If there is a single idea which explains the collapse of the Labour party, it is that.

The central initiative of my right hon. Friend the Prime Minister's Government is to return Government to their proper role, and part of that task is to return the remaining nationalised industries to their proper place, which is the marketplace.

Ms. Mildred Gordon (Bow and Poplar)

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Mr. Waldegrave

I will proceed as I have given way generously.

There is no question about the benefits already achieved for citizens and customers. For example, since privatisation, British Telecom's prices have fallen by 27 per cent. in real terms. British Gas has cut its domestic prices and standing charges by 13 per cent. and 23 per cent., and the regulator is seeking more. British Steel now takes less than five hours to produce a tonne of liquid steel compared with 13 hours in 1979–80. The water industry will invest £28,000 million before the turn of the century, ending the dereliction of many years. It was, along with the health service, the worst victim of all of Labour's catastrophic cuts of 1976–77.

Partly as a result of our policies, there has been a huge increase—to about 10 million people—in the number of shareholders, including hundreds of thousands of employees in former nationalised industries. That process has done far more, in reality, to spread and disperse power among our citizens. It has reversed the old process of the concentration of power, which was inherent in the old nationalised industry structure.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich)

I am grateful to the Minister for graciously giving way. Does he agree that those shareholders who are workers and ex-workers in British Rail Engineering Ltd., BREL, should have the right to buy more shares in the company, or should they be forced, as they will be, to divest themselves of their existing shares?

Mr. Waldegrave

I do not know about that specific case. I shall ask the Minister most directly concerned what the answer is. However, that is exactly the kind of interventionist decision which should not be taken even by the hon. Member for Bolsover (Mr. Skinner) or even with the wisdom of the hon. Lady. It is that delight in detailed intervention from which denationalisation protects those very industries. There is no doubt whatever that separating industry from the managerial attentions of politicians is good for both.

The hon. Member for Kingston upon Hull, East is a real socialist—not what one might call a red-rose socialist —and he does not hide his light under a bushel. With respect to him, he is a perfect example of what industry does not need. Let his famous letter to the chairman of British Rail speak for itself. On each of its six extraordinary unproof-read pages there is a list of detailed instructions written in the language of an 18th century squire of a rather reactionary type addressing his workers. The hon. Member for Kingston upon Hull, East neglected one thing only—to get himself elected to the manor house before sending his instructions to the tenantry. That letter, with its list of detailed, interventionist ideas, seems to be the best and most eloquent argument that could be made for denationalisation.

Mr. John Prescott (Kingston upon Hull, East)

If the Secretary of State reads the instructions given to British Rail every three years under the corporate plan, he will find that exactly the same language is used by Tory Secretaries of State to the chairman of British Rail.

Mr. Waldegrave

I have the letter in front of me, and it would be entertaining to read it all to the House because on every page the words "I will instruct" and "I will require" appear a dozen times. That is exactly the role which the hon. Gentleman or future Secretaries of State should not hold—[HON. MEMBERS: "Oh."] That is why we shall denationalise those great industries.

No one now doubts the benefits to industry of being free of that brand of amateur management, but the benefits to Whitehall and the House are real. All that resulted from such cackhanded amateur management was that the state earned the enmity of ordinary people, who learned the hard way that the man from Whitehall does not know best. Some examples this afternoon show that even this Parliament must have often appeared to the people to be more concerned with protecting the status quo of nationalised industries than with the goods and services provided to consumers.

Ms. Diane Abbott (Hackney North and Stoke Newington)

Will the Minister give way?

Mr. Waldegrave

No; I have given way enough.

That clearer role for Government and industry will be demonstrated in the further steps that we shall take on privatisation in this Session, as described in the Gracious Speech, and in future Sessions. Coal will be returned to the private sector. Proper and powerful regulation to protect the environment and the safety of workers does not now require state ownership of those industries. Regulatory frameworks already exist and the Government are fully committed to their effectiveness and independence. The privatisation of other state-owned industries, such as local authority bus companies, will follow.

Mr. Robert Adley (Christchurch)

Will my right hon. Friend give way?

Mr. Waldegrave

I shall give way to my hon. Friend if he wishes to speak about British Rail, as any hon. Member should. We intend to bring competition and private capital into the network by franchising. A new rail regulator will ensure that all companies have fair access to the track and that agreed standards are met.

Mr. Adley

As ever, we are enjoying my right hon. Friend's philosophical appraisal of the political situation. I hope that he is saying that the Conservative party is now pragmatic, whereas we fear that many Opposition Members are dogmatic. Does my right hon. Friend agree that there must be a role for the state somewhere? We do not want Wessex fighting Mercia in privatised armies. We believe that it is right, for example, that we should have a national curriculum. Does he agree that the job of the Government should be to find the right place to put the line, and not automatically assume that the state has no role to play in either the major industries or the services which the nation expects to be provided for it?

Mr. Waldegrave

The state has an absolutely crucial role to play—that of regulator, legislator and creator of the framework. I beg my hon. Friend to believe, on the evidence of the decade, that the state as industrial manager is not at its best for the state or for industry. Virtually no one now thinks, in Britain or abroad, except in the British Labour party, that Government or citizen is well served by a Government trying to be the provider of goods and services. Nationalisation is dead.

My second proposition is that a new and clear theory of government is now coming forward to replace nationalisation. Government should, where necessary, be the regulator of industry and the representative of the citizen.

Mr. Donald Dewar (Glasgow, Garscadden)

Is what is included in the Queen's Speech properly described as the privatisation of the railway system?

Mr. Waldegrave

What is described in the Queen's Speech is the same as what is described clearly in our election manifesto—access to the network by franchising to private capital. The hon. Gentleman may not have found time during the election campaign to read our manifesto. If what we aim to do leads to privatisation, so much the better. But the hon. Gentleman should wait for the Bill.

Where necessary, Government should be the regulator of industry and the representative of the citizen. Where possible, they should set a framework for competition to deliver real and effective power to the consumer. Where there is monopoly—publicly or privately owned—regulation on behalf of the consumer must be tough. The arm's-length relationship with privatised industries, even —or perhaps especially—when they are monopolies, makes that far easier. In the new world, citizen or consumer becomes king again, as he does in Whitehall, where the old insider track for the producer giants is ended.

Where the function is a service, properly provided in a modern state by a Government—for example, health or welfare—the Government should organise themselves to represent, above all, the interests of the user. In those spheres, Government will be directly answerable for the standards of services provided, and for their cost. We, as Ministers, should be remorseless in our pressure on the organisations that we set up to deliver services to the standards that the citizen as user wants, and with the maximum cost efficiency that the citizen as taxpayer demands. By far the best way of doing so is to make clear and explicit contracts on behalf of the user with those whom we pay to provide the services. It is that customer-contractor, provider-purchaser, split that lies at the heart of the new doctrine of how Government, central and local, should provide services.

Into the agreements that Government make on behalf of the citizen should go, quite explicitly, the standards agreed on his behalf, with clear procedures for measuring and publicising whether they have been met. The user must be told openly what the standards are, and given usable information on performance so that he can judge whether they have been met. The provider must be told of the consequences if he fails, including the possible loss of his contract as provider.

Ms. Abbott

If the Minister argues that privatisation is so good and nationalisation is so bad, why is it that, whenever the public is polled on the possibility of the privatisation of British Rail, the public is overwhelmingly against it?

Mr. Waldegrave

If what the hon. Lady says is true, it may be because the public have been led to believe by the Labour party that privatisation would lead to inferior services. To take the examples that I have given, once those policies are carried through, they become popular, not only with employees but with the country at large.

Ms. Abbott

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Mr. Robert Hughes

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Mr. Waldegrave

The hon. Lady and the hon. Gentleman have just had the opportunity to put that argument to the country, and it did not meet with much faith.

Mr. Hughes

Will the Minister give way?

Mr. Waldegrave

No—we have had enough interventions from Labour Members.

The provider must be told of the consequences if he fails, including the possible loss of his contract as provider. If the service is not good enough, other providers must be found. Providers owned by the state should have no special privileges if service is not adequate.

That is the set of policies that my right hon. Friend the Prime Minister has called his citizens charter, each part of which fits with the rest. Standards are being set for the public service; regulators are delivering cuts in prices on behalf of consumers; on behalf of patients, health authorities and general practitioners are demanding better service in hospitals; independent inspectors of, for example, schools are publicly reporting on the standards; the purchaser-provider split is building a constant dialogue on quality control into public services. In every aspect, the Government are returning to their proper, historic role as champion of the individual against the special interest, not acting as the representative of the special interest.

These themes are interconnected. There should be an open and clear setting of standards, which the citizen as customer, client or consumer can expect, with clear publication of the results of the monitoring. That must be done by the organisations themselves. For example, British Rail is today starting its track record initiative, and is publishing information on punctuality and reliability at about 100 Network SouthEast stations.

There should be far more openness in 'general, from Whitehall down to the local school. In the next few days, we shall be publishing for the first time the membership of Cabinet Committees, and the document on guidance to Ministers. In our, unwritten, constitution, such procedural rules are important—as they are to the House.

Sir Teddy Taylor (Southend, East)

Will my right hon. Friend the Minister clarify what is being proposed? He will know that I represent commuters on the Fenchurch Street line, which has been woefully neglected by British Rail for many years. The people in Southend want to know whether the proposal is for a private firm to run the railway line, with British Rail still being responsible for investment, or for the private firm to have some involvement in the investment programme?

Mr. Waldegrave

The details of bids must wait until the Bill is passed, but the principle of the matter is set out clearly in our party's manifesto, with which my hon. Friend will be as familiar as I am. It is clear that private companies—a number of them are queuing up—will be given access to bid for the provision of services, and if they bid to provide services to Southend there will doubtless be an increase in competition which will bring about an improvement in service for my hon. Friend's constituents.

The regulator, British Rail, will be accountalbe for the performance of the franchiser—not a difficult concept for even Opposition Members to understand. The underlying principle of clear standards and open accountability, with the provider being removable if he does not provide them, lies at the heart of the dispersal of power which goes with the policy. One of the best writers on British Government once wrote of Whitehall as being like a village where little was open or explicit. That has been true of too much of the way in which we have done things in Britain, and change is overdue. Government is too big a part of national life to be conducted like that, and my right hon. Friend the Prime Minister means to change things.

Mr. Campbell-Savours

Will the Minister give way?

Mr. Waldegrave

The hon. Gentleman must let me continue; I have already given way to him once.

These are the ideas which my right hon. Friend said would lie at the heart of decision taking in the Government, and the groundwork has been well laid by Francis Maude, to whom I pay a warm tribute. I hope that he will soon be returned to the House.

My third and final point has been confirmed in the House today. These policies offer an immensely powerful and logically consistent programme. They bring choice, ownership, accountability, openness, efficiency and effectiveness together as the weapons that the Government will deploy to see that the power of the citizen becomes a reality. They deal with the real issues of the 1990s and beyond. I may be wrong—although nothing said by Opposition Members has given me cause to think that I am —but I do not believe that the Labour party has yet begun to grapple with the fact that the doctrine of the state at the heart of its political programme has collapsed, leaving a vacuum. The very fact that most Opposition Members sit here as unashamed representatives not only of their constituents but of those most antique of producer lobbies, British trade unions, confirms that more eloquently than any words could. I refer in particular to some of the public sector unions whose party-political advertisements appeared at the time of the election—notably those of NALGO and the Inland Revenue Staff Federation. Many of their members, I suspect, are fed up with being used as political cannon fodder in this way.

It is not just a matter of whether the block vote is delivered to Mr. Brian Smith or Mr. John Gould. Every sponsored Opposition Member represents the old power structure and the politics of the past. From my party's point of view, long may that last—long may the hon. Member for Kingston upon Hull, East flourish like the green bay tree, as he shows every sign of doing. For while he and his colleagues continue to fight and lose the battles of the 1890s, we shall be fighting and winning the battles of the 1990s.

4.2 pm

Mr. John Prescott (Kingston upon Hull, East)

May I express my congratulations to you, Madam Speaker, and my warm feeling towards your appointment to your new job? We have worked together on a number of delegations and it gave me a moment of great pride and genuine pleasure when I learnt that you had been elected Speaker by the House.

We have just heard a speech that was supposed to be, in the words of the Secretary of State, powerful and logical, but I am bound to say that that was not evident from the speech itself. If it represented the cutting edge of Majorism, that does not say much for its cutting power—

Mr. Waldegrave

It has won the argument so far.

Mr. Prescott

Nevertheless, here in this House the arguments must still be deployed. Today the right hon. Gentleman attempted to put his arguments for why he believes that privatisation is an important part of the Queen's Speech.

The Queen's Speech, however, does not propose the full-blooded privatisation of British Rail, since many involved in the practicalities have seen that British Rail cannot be fully privatised without major consequences for the consumers and passengers whom the right hon. Gentleman says he wants to defend.

The right hon. Gentleman's speech today has received considerable publicity in the newspapers—I believe that he has been described by the Prime Minister as the Minister for little people. I hope that he goes from strength to strength, but I suspect that he will not be a very powerful Minister for the little people. He has been described as the new superstar in the Government, but from the descriptions in the newspapers I could not make up my mind whether he was the new superstar or the Minister for paper clips. In his speech he seemed to fall somewhere between the two.

I welcome this opportunity to debate privatisation. There are major philosophical differences between Labour and the Conservatives and this is the forum in which to re-emphasise and debate them. The Minister has at least attempted to do that. In a debate on privatisation, especially of coal, one would have expected the Secretary of State for Trade and Industry or the Secretary of State for Transport to deploy the arguments.

The Minister might not have got himself into such difficulties if he had known the detail surrounding his job. Some of the questions put to him about transport are generally known to most hon. Members and would have been familiar to the new Secretary of State for Transport —the eighth or ninth in the past 13 years. I have made my protest clear. The Secretary of State for Transport should be here because the debate is largely about the privatisation of transport and especially of British Rail and British Coal.

The Minister put his case too strongly when he said that the nationalisation of public utilities and public industries should be avoided by all Governments. The nationalisation that came immediately to mind, and properly so, was the Tory Government's intervention to save Rolls-Royce. There was not a dissenting voice in the House when that happened and there was certainly no vote against it because people knew that only the Government could save that company. It was subsequently privatised, but I do not think that anyone doubted that the state had to intervene to save Rolls-Royce—an important high-technology company. It was right to take it into public ownership but wrong to pass it back to the private sector. However, that is a matter of political judgment.

The Minister set out what he thought were the judgments to be applied. They were whether the theory of nationalisation had failed and whether it was important to have a link with the citizen. We accept that there is a need for such a link, but public ownership does not deny the opportunity to defend the citizen's rights or to ensure that public utilities provide good quality gas, electricity and water. Those issues have been at the heart of the privatisation debate. I am not convinced, nor are many consumers who now, as it were, languish under the privatised sector public utilities, that those objectives have been met in as good a way as they were in the public sector. There are facts to justify that view.

I shall confine myself to the issue in the Gracious Speech, which is largely about privatisation. The Minister's arguments for the privatisation of coal and transport are perhaps a little different from those that he would have advanced for gas and electricity. Coal and transport are not easy to privatise for a number of substantial reasons. The industries have common factors that must be taken into account. They are both strategic and, in the national interest, there must be proper utilisation of our coal resources, which are considerable, in a national energy policy.

In order to deal with problems of congestion and the environment there must be an effective rail system. That has been discovered in Europe. People must be encouraged to use their cars less and public transport more, because we cannot build our way out of a 140 per cent. growth in the use of the motor car in the next 25 years. Sufficient roads cannot be built to meet such an increase in demand. Public sector industries are important and buses, trains and aeroplanes have a major part to play in reducing the massive costs of congestion and environmental damage. That is the challenge for those industries and the Government must have a view about how those industries will develop. Whether they are publicly or privately owned can be debated, but Government must have a role.

The Secretary of State for Trade and Industry is as much interested in whether the coal industry can get a coal contract with the national power generating companies, particularly if he wants to sell the industry off. Without a proper contract for coal, the industry is not saleable, as must be evident to everyone. That means that the Secretary of State for Trade and Industry may have to impose, or at least influence, a contract for coal at a price higher than the dump price at which coal is sold on the international market at present. The Government have to have a judgment and a position. Whether publicly or privately owned, the Government must have a role in the running of the industry.

Neither of these industries can be left to market forces, which cannot alone solve the problem. There must be assistance, through a financial or regulatory framework in which the Government are involved. Both industries would be in a worse position if the market were left to create the solutions. Both are efficient in comparison with their European counterparts. It may be argued that the coal produced in British coalfields costs more than gas in fuel equivalents, but it is still the cheapest deep-mined coal in Europe, and nobody argues about that.

Whatever the arguments about the rail industry, productively it is far better than in most of the European systems and it costs a lot less to finance, although I would argue that it needs more money. Given the state resources to these industries, both are more efficient than their European counterparts. Furthermore, both of them have suffered, under both Labour and Tory Governments, from the stupid Treasury rules that we apply to public-sector industries. I protested when Labour Governments used them, and I continue to protest today, under a Tory Government. Anybody looking at the role of Treasury funding and Treasury rules for our public-sector industries knows only too well that they disadvantage the public sector.

One of the first things that happens when public utilities are privatised is that they are allowed access to private capital, which means that they can borrow money often at a cheaper rate, and to equity financing—methods that are denied to industries in the public sector which have to use public loans, which have high interest rates. That is one of the reasons why so much capital debt is written off for these public industries. Both Governments have done that. We have been unfair in preventing public-sector industries from borrowing privately, using leasing arrangements. That has added to the financial difficulties of these industries.

There is thus a strong argument for changing the Treasury rules, just as there is for doing something about pricing policies. I know of no Government who have not been tempted—here we may have the point that the Minister wished to make—perhaps because of a prices and incomes policy, to influence the prices of those industries. Even this Government continue to influence prices because that has political and economic consequences.

Even if these industries were privatised, they would still require Government support. Privatisation requires the writing off of billions of pounds in accumulated debt because of the process of Treasury financing, and the paying of millions of pounds to agencies and banks to facilitate such a process. The real value of the assets is not reflected in the selling price because the price is well below the asset values of companies when they are sold on the market.

Therefore, I would judge the process of privatisation against what we have in the public sector and by whether the consumer is better off as a result. That is the challenge posed to us by the Minister, and I shall answer it.

Mr. Peter Thurnham (Bolton, North-East)

The hon. Gentleman spoke about philosophical differences. The hon. Member for Dagenham (Mr. Gould) said that he would like to exclude the dividend to private shareholders. Would the hon. Gentleman be happy to serve under a leader committed to such a policy?

Mr. Prescott

I am sorry but I must ask the hon. Gentleman to repeat his question. I was distracted.

Mr. Thurnham

The hon. Member for Dagenham said that he would like to exclude the dividends that are paid to private shareholders. Would the hon. Gentleman be happy to serve under a leader of the Labour party who was committed to such a daft policy?

Mr. Prescott

I do not recognise the question that the hon. Gentleman poses. He may well have the opportunity tomorrow to put his question to my hon. Friend the Member for Dagenham (Mr. Gould) when we continue to debate the Gracious Speech.

The Government do not justify privatisation on the basis of intervening on behalf of the little citizen. Instead, they want to get their grubby hands on moneys that become available as a result of selling assets. That is the only reason for intervention and privatisation. The Government are interested not least in reducing the public sector borrowing requirement in pursuing their monetary policy. When the borrowing requirements of privatised industries come within the private sector, the same reasons are deployed for the need to invest, but they do not come within the PSBR. Irrespective of whether the investment, public or private, is beneficial to the economy, including the consequential effects of it, the Treasury rules prevent such investment taking place if the industry is in the public sector.

A considerable amount of evidence—it is produced during Select Committee hearings and elsewhere—is available to the Secretary of State to enable him to compare the public utilities such as gas, electricity, telephones, water, the railways and the mines with their counterparts in the rest of Europe. The privatisation of gas, electricity and British Telecom followed the public ownership of those utilities. Tory and Labour Governments brought them into the public sector because their capital requirements were vast. These utilities were built up by Labour and Tory Governments for the good reason that their massive capital requirements meant that the state had to be involved. Secondly, industries that would be strategic to any economy required security and stability. It was through state involvement that we developed these major industries, making a major contribution to our economy.

By adopting that approach, we secured a better investment programme for the industries than their counterparts in the rest of Europe. There was better investment and research and development in this country. There was greater innovation and cheaper prices here than elsewhere in Europe. The scale of our research and development was far ahead of any European counterpart.

Let us consider energy production, especially in terms of the gas and electricity industries in the private sector, in America. The American industries are worried that they will not be able to secure sufficient resources to enable them to invest on the scale that is required, to generate the gas and electricity that is required and meet their capital requirements. That is part of the argument of the public utilities. They want stability. In fact, they do not have competition. There was, however, competition between the electricity grids in New York and those in other American states. There was more concern about the provision of electricity in the various states than about preventing the black-out that occurred in New York. That led to an argument that was based on competition and whether a competitive advantage could be achieved, not on whether there was a national obligation to maintain stability in the provision of electricity. That was what competition produced in America. In this country, we produced stability in a system of which we should have been proud instead of proceeding to break it up.

Mr. Andrew Rowe (Mid-Kent)

Does the hon. Gentleman agree that when the water industry, for example, submitted the sort of investment that it required, it found that it took bottom place in the list of public sector requirements? Since the industry has been privatised, its investment has rocketed.

Mr. Prescott

I was trying to make that point. Basically, the Treasury would not allow the water industry to borrow on the private market. That was the position of all the public utilities. That does not happen in America or in the rest of Europe, because industries there are allowed to raise money in different ways. There is no reason why the public sector here could not have done what the private sector is doing. It was not prevented from doing so by legislation that was enacted by the House. It was stopped by Treasury rules as defined by the Treasury and civil servants, who decided that the public sector industries would not raise moneys in the private market. We can have a big argument about this, and I tried to initiate one on 11 July during a debate on British Rail and its financing requirements. I shall not advance again the arguments that I deployed on that occasion. I merely say that the private sector can borrow for investment while we prevent the public sector from doing so. There is no justification for that.

The public sector has a good record. If anyone doubts that, I ask him to compare the publicly-owned telephone system in Britain, which is in my constituency, which is part of Hull, with the privatised British Telecom. The publicly-owned system's prices are cheaper and there is proportionally greater investment and research and development. Some older people are provided with a free telephone because it is felt that it is necessary that they should have one. That system, which is run by a local authority, is far superior to the private telephone system, with all its Mercury competition.

I do not accept that the public sector cannot produce a better service. It can do so. It can, of course, have a lousy management and do it lousy. There are good private companies and bad private companies, and there is good and bad in the public sector. Management's function is to control, and ownership is not the issue. There can be good management in public companies and good management in private companies. It is not simply an issue of ownership. The reason for the Government's drive for privatisation is the loot from the sales. More than £60 billion has been raised by selling assets. It is just a quick buck because the Government gave up the right to the yearly profits and income from such industries as gas, electricity and water. Those profits were available and were often taken by the Treasury.

The Government's argument is one of less interference. They say that the consumer will be better off through greater investment in research and development. Their ideological view is that it is better to have a private rather than a public monopoly. Their first objective of loot was achieved. They got their £60 billion plus, but what about the taxpayer? It cost £18 billion simply to write off debt in those industries. The Government undervalued the amounts of money in those industries by £4 billion—that is the amounts that the stock market recorded as their value after the sale of shares on the first day. The taxpayer lost a great deal of money.

The bankers and the other Government agents were given £1.5 billion for the privilege of selling the assets. I notice that £1.3 million was paid by one agent to the Tory party. I suppose that a 10 per cent. kick-back was the arrangement. Of course, some of the Secretaries of State who privatised those industries then joined their boards. They have done very well out of it. Privatisation is to do with kick-backs, greed and sleaze in the Tory party.

Privatisation was also good for the salaries of the chairmen of those industries. The Secretary of State said that he was protecting the little people—the consumers. I shall come to the effect on them in a moment. It was certainly beneficial for bankers, agents and Secretaries of State, none of whom could be described as the little people. The salaries of those little people who are the chairmen of those industries have risen by between 30 and 75 per cent. The salary of the chairman of British Telecom rose from £84,000 to £536,000. He made changes and put thousands of people on the dole. That affected the rate of return on profits—of which, of course, the chairman gets a share.

In what is the consumer most interested? It is prices. The Secretary of State picked out one narrow price example that has occurred only during the past 12 months. The truth is that prices in those industries have increased considerably above the rate of inflation. There has been an 11 per cent. rise in electricity prices, 94 per cent. in water charges, 4 per cent. in telephone charges and 25 per cent. in gas prices. Those are considerable real increases above inflation.

Investment in those industries has begun to fall. In British Telecom it has fallen by 18 per cent. in real terms. Investment in research and development in the gas industry has fallen by 16 per cent. Thousands and thousands of people in those industries have been made redundant. That is the Government's record on prices, investment, research and development and jobs.

One measure of the effect on the little people is the number of complaints, which have increased considerably. In 1990, there were almost 200,000 complaints against the public utilities. Polls show that between 30 and 50 per cent. of people are dissatisfied with the public utilities since privatisation. Those indices do not show satisfaction among the little people whom the Secretary of State says he is here to defend. Privatisation was done in their name, but it has not been beneficial to them.

Sir Thomas Arnold (Hazel Grove)

The hon. Gentleman says that ownership is not the only issue, and I accept that. Is he in favour of retaining clause IV of the Labour party's constitution?

Mr. Prescott

I was arguing that there is a good case for public ownership, which is embodied in Labour's clause IV —which I am happy to accept—[HON. MEMBERS: "Oh."] I do not see why that should be so staggering. Do the Government, in declining to privatise British Rail, accept that argument? If they do not believe in clause IV, why does not the Bill privatise British Rail? That just makes a nonsense of their argument. Some industries do better remaining in public ownership than in private ownership.

The Chancellor of the Duchy said that the regulators would be tough with privatised industries. That will be good when it happens, but it has not happened yet. Does that mean that the right hon. Gentleman will not leave matters to market forces? Is he saying that a regulator should intervene instead of Parliament, so that privatised industries do not exploit their monopoly? I do not know where regulators fit into Labour's clause IV, but it is about intervention, controls, and judgment in the community as to the price mechanism and investment levels. That is as at home in America as it is here. Public utilities are in a sense private monopolies. They exploit their position, and they are bound to do so.

Mr. David Sumberg (Bury, South)

Has not the hon. Gentleman forgotten one group of little people? I refer to the hundreds of thousands of small shareholders who bought into those public utilities. They want to keep their shares. There are now more shareholders than trade unionists in this country. What does the hon. Gentleman have to say to those shareholders—most of whom voted Conservative at the general election?

Mr. Prescott

Fifty per cent. of the original small shareholders sold their holdings within the first 12 months to make a quick buck. Today, concentrated capital in the City's big financial institutions controls our utilities, and they have little accountability. The hon. Gentleman should be more concerned about the hundreds of thousands of people who cannot afford to pay for heating because energy prices have considerably increased. The number of disconnections has also increased. No one is concerned to help those people. The little people are more concerned about how they can afford energy and heat than about buying shares. When it comes to it, that is the difference between us.

In case the House thinks that I am exaggerating the profits that are being made, and just to show that I am an intellectual, 1 refer to an article in today's issue of The Times business section. If the Chancellor of the Duchy had read it, he would not have said some of the things that he did.

The article reports that a storm threatens over the likely surge in power profits. It states that the 12 electricity distribution companies expect to report a profits rise of more than 40 per cent. in their first full year since privatisation. That is a phenomenal figure—higher than expected. The article adds: Manweb's profits before tax should soar to £95 million last year, an increase of 77 per cent. on 1990–91. It is predicted that the industry's profits will rise another 13 per cent. by June next year. That is the scale of the profits made under privatisation and why shares have been oversubscribed. People know that there is a good killing to be made—but who pays for it but the little people? What will the Chancellor of the Duchy do about them and all those massive profits?

Mr. Waldegrave

Would the hon. Gentleman be happier if the rumour was that the profits of those industries were going down? Is that what he is saying?

Mr. Prescott

No, but a 77 per cent. increase is phenomenal in any terms, and is not justifiable under the circumstances. That supports our argument about public utilities. When they are converted from public to private monopolies, there is little accountability. Those utilities then exist to look after not the little people but their shareholders. That is precisely what is being said by their chairmen. The millions of people who have no shares in those utilities have to pay the price, to produce that level of profit. The right hon. Gentleman should be concerned about a 77 per cent. increase in profits. My information is right up to date.

Then we come to the coal industry. What worries me is this: given that the electricity industry can make so much money, what will it do next? Encouraged by the Government to introduce competition, the industry will now argue for generation by means of gas rather than coal. The implication of that is starkly clear—the electricity industry will not want to order coal.

Such a development will have a major effect on coal privatisation. I believe that the contract is to be negotiated in the autumn. If bodies that are making excessive profits begin to turn to gas generation, that is bound to have a significant impact on energy policy. It will certainly affect the coal industry. Already, pits have closed on a massive scale; the number has now fallen under the Tories from 200 to 50, and the latest report suggests that, if the contract is not secured, there will be 15 or fewer pits left.

The companies concerned have been encouraged to turn to "more attractive" generation—in other words, cheaper generation. That means either generation by means of imported coal or gas generation, and it has major implications for the economy and the use of energy. We are importing a good deal of coal, and we have a considerable trade deficit. That will now increase. Redundancies will be another problem: because 200,000 redundant miners have been presented with no alternative jobs in the mining areas, their redundancy has cost nearly £1 billion in unemployment pay—and, given the high unemployment levels that have existed under the present Government, the amount has already been increasing considerably.

Whole communities will be wiped out. The right hon. Gentleman cannot be indifferent to the development of a proper energy policy; the Government cannot stand aside from matters such as the use of gas, imported coal and our own deep-mined coal. Presumably the Secretary of State for Trade and Industry, so that he can fulfil the policy to privatise the mines, will ask the right hon. Gentleman to persuade the generators to buy the extra-cost deeper-mined coal. Will the right hon. Gentleman now direct them towards the more expensive fuel option? I do not think for a moment that the Government will stand aside from the issue. They want the money from the sale—although the industry will problably be sold at a giveaway price—and they must be involved in the coal contract.

It will not stop there, however. Many industries are dependent on coal. My area contains a firm, Fenners, which makes webs and belts. Firms that have been major contributors to the Tory party are suddenly beginning to realise that running down the coal industry affects manufacturing capacity. That is another important aspect of public utilities: they have been a major source of the development of manufacturing capacity in this country, thus affecting orders and investment. Sometimes we have paid more for British manufactured goods than we would pay for imports. That does not worry the private sector, but it is crucial to the development of our economy and manufacturing industry.

A connected issue is transport. The Government say that they will sell off the freight sector. A profitable part of that sector is rail freight, and 80 per cent. of its profits come from moving coal around the country. Once the pits are closed, that profitable part will no longer be profitable. At least it is profitable now, and the money made by rail freight can be invested in the rail system. I do not know why Conservative Members are laughing; the link between industrial investment and transport policies is a serious matter. It is clear that rail freight is dependent on coal.

The Financial Secretary to the Treasury (Mr. Stephen Dorrell)

The hon. Gentleman seemed to be arguing that we should keep the current level of coal mining going so that we could keep the trains going on the railways.

Mr. Prescott

The Community has spent millions of pounds in investing in coal port areas. The hon. Gentleman should know that, as he was once my opponent in Kingston upon Hull, East—he was defeated then. I am merely saying that, before they sell off the rail freight industry, the Government should consider the goods that the trains are carrying. Trains carry coal; now the number of mines providing the demand is to be reduced. If things are allowed to continue as they are now, the privatisation of rail will follow—or, at least, certain parts will he sold off.

It has been called cherry picking and selling off the profitable parts of the rail system. It has been suggested that Virgin might offer a two-tier service. One Minister referred to it as cheap and cheerful. British Rail would still control investment in track and signalling. No private sector body would want to carry out that important and expensive task. All that the private sector wants to do is to lease trains and run them on the track. The private sector would be provided with advantages in that way.

I do not set my face against the involvement of private capital. British Rail has attracted private capital on the freight side for some years. That is irrelevant, however, when one considers the inadequate funding of British Rail. Between £3 billion and £4 billion has been taken out of its coffers and that has caused it real problems. It has had a major effect on manning, investment in safety measures, track investment and quality and reliability of service. So much money has been taken away from British Rail that it is now the poorest funded railway system in Europe. The quality of the system has consequently suffered.

I have argued the case for private capital. Publicly-owned companies in Europe borrow privately. I am prepared to see British Rail have a debt equity base so that it can borrow privately. That is not an ideological problem for us. Any publicly-owned facility can do that. However, one has to look at the Government's record on private capital. They introduced the concept of private capital for the channel tunnel, which has had more than its fair share of problems. The Government also said that private finance must be found for the channel tunnel rail link. They stated that no public money should be involved. Now we do not know when the rail link will be operational. It will probably not be completed until the next century. While the European economy steams ahead, we still do not know where the rail link is going to be. That is scandalous.

As for the Paddington to Heathrow link. British Rail expected to be able to invest 20 per cent., but it cannot find even that amount of money. London, a major capital city, does not have a proper railway infrastructure to connect it to Heathrow. The west coast main line is desperately needed but it is inadequately financed. It needs £1 billion, but the Government have not stated clearly where that money will come from.

As for docklands, the jewel in the Tory party's crown, the Jubilee line is not London Transport's priority. That was shown clearly in the Government's report. However, because Olympia and York offered £400 million towards a £1.7 billion project, the Government rushed in and said that there would he a combination of public and private investment. Last month, however, they failed to meet the first month's £40 million contribution. There is a financial crisis, bordering on bankruptcy. Now we hear that the Government intend to reschedule the debts and to move in and take a few floors of office space for the Departments of Transport, Environment and Trade and Industry. What makes me smile is that all the civil servants who are to be moved to docklands will have to travel by means of the docklands light railway, which is our most over-utilised rail system. The Treasury set the standards for the completion of that railway, with the result that it has become totally ineffective. It keeps on breaking down and now, I believe, has been sold for £1 to a company that has no experience of transport. I understand that the first thing that the company did was to ring up London Transport and say, "How do you operate it?" If that is an example of how Tories talk to City people and use private capital, God help us. Of course there is a role for Government.

The Queen's Speech, which proposes a few private coaches being tacked on to the Edinburgh train, the selling of a few stations and the addition of a Virgin train, is irrelevant to the problems of British Rail. Is the argument that private sector management is better than public sector management? The Secretary of State chastised me for the language in the direction. The same language was used by the previous three Secretaries of State in instructions to British Rail. I make no apology. I instructed British Rail to produce a safety plan showing where the money would come from to improve safety on British Rail. After the terrible tragedies on our railways. I wish that the Secretary of State would issue such an instruction.

The remit to rail management was given by this Government. The Government told British Rail, "You must make InterCity profitable." It has done that. By Treasury definitions, it is the only profitable rail line in Europe. The Government said: "Bring in private capital", which it has done on its freight and wagon fleet. The Government told it to improve productivity, which it has done considerably.

Mr. Bruce Grocott (The Wrekin)

Will my hon. Friend give way?

Mr. Prescott

I shall in a second.

The Government told BR to reduce the PSO—the subsidy given by Government, which reduced in real terms, at 1990–91 prices, from £1,280 in 1983 to £520 in 1988–89. It achieved that, but then the Government sacked the chairman, poor Mr. Reid mark I, who achieved the objectives that they had set. BR achieved every objective that the Secretary of State set. There was nothing about quality of service or reliability, yet the Government blamed management. The Secretary of State may say that politicians should not be involved, but they gave management those objectives and failed to provide the resources to meet them.

The real issue is resources. In 1980, Peter Parker. the then chairman of British Rail, produced a plan and said. "We need so many resources that it cannot all come from the taxpayer; it must come from the private sector as well." They were refused the right to borrow from the private sector.

The Government have appointed a new chairman, Mr. Reid mark II, who told them that BR needs £1 billion a year. The Government have not said where the money will come from, and the rumours coming from the Treasury of public sector cuts promise little for the major investment that our rail industry needs.

The Minister for Public Transport (Mr. Roger Freeman)

I am sure that the House would like to know that Sir Robert Reid, the first chairman of British Rail, was not sacked. British Rail is investing £1.5 billion this year.

Mr. Prescott

I withdraw that: he was not sacked, but he left a disappointed man. He felt that he had been made the scapegoat for an industrial dispute, despite achieving all the objectives within the tight financial framework set by the Government.

The Minister mentioned BR's investment this year. What is it likely to be next year? In "Future Rail: The Next Decade" British Rail's chairman—whom the Government appointed and who has business experience with a powerful private company. Shell—says that he needs £1 billion a year for the next 10 years. I could understand the Government arguing against that if they had produced their own financial framework, but they have not done so. Therefore, instead of cleverly jumping up here, will the Minister tell us what British Rail's investment resources will be over the next five years?

Mr. Freeman

I will tell the hon. Gentleman in October.

Mr. Prescott

He has not answered. No wonder the Chancellor of the Duchy of Lancaster opened the debate instead of the Secretary of State for Transport.

The reality is more financial constraints. The Chancellor of the Duchy of Lancaster spoke of the passengers charter making the consumer king. He was concerned about the little man and about making the consumer king. The passengers charter did not set tougher targets for reliability but made it clear that no extra money would be made available. Old trains are less reliable than new trains. Passengers who use the Southend line or Kent routes know that it is no good talking about achieving the passengers charter without decent rolling stock or reliability.

The Government did their old trick, which they use for the unemployment statistics: they fiddled the figures. In 1986, they defined a late train as being five minutes late, and 23 per cent. were more than five minutes late. In 1987 they redefined it as 10 minutes and 13 per cent. were late, which they claimed to be an improvement. They have now defined lateness as one hour, before which passengers cannot claim compensation. They then exempted those passengers who lived in metropolitan transport authority areas—it therefore would not apply to millions of people, and then limited it again to people with season tickets in the Southern region. That is all useless hype, nothing to do with the problem.

Let me make an offer to the Chancellor of the Duchy of Lancaster, in the spirit of goodwill in which he presented the debate today. As I said on 11 July 1991, this country would be better served if we took a bit of the ideology out of running our rail system. Is he prepared to do that and to recognise that British Rail is the sole authority and should not be separated? Its needs for investment in signalling and rolling stock can be met by public or private finance. We must change the Treasury rules. Let us agree on a 10-year rolling programme of investment for British Rail—and it needs that certainty. Let us agree that rail has a major part to play if we are to do anything about congestion and our environment. Let us agree on those quality objectives and allocate the finance necessary to achieve them. Let us agree also on fair criteria for investment in road and rail, instead of it being loaded against the rail system.

If the Chancellor of the Duchy of Lancaster accepts and implements those practical measures, he will do more for the little people of this country than all the ideological nonsense he spoke. Let us improve our rail system; it would not be particularly socialist to do so. It is commonly done in Europe, so it is necessary that we have a good transport system that meets the needs of people and industry in this country to enable Britain to take part in the European economy, which we are bound to do. That is the least that we can do and it would be a major step forward. I hope that he will pass on that message to the Secretary of State for Transport, who should have attended this debate instead of him.

4.46 pm

Mr. Michael Alison (Selby)

Much the most interesting point made by the hon. Member for Kingston upon Hull, East (Mr. Prescott) was his sharp attack on the effect of the Treasury hand on public expenditure under the present Conservative Government and earlier Labour Governments, along with his claim that the quality of management in public and private industries was on a par. But he cannot have it both ways. Public sector and nationalised industries cannot get rid of the cold hand of the Treasury. To imagine that there is an alternative to avoiding Treasury supervision—a Treasury tranche of management—is simply self-deception.

I am surprised that the hon. Gentleman did not focus sharply enough on the proper role of the Treasury, which, after all, is the accountant in the operation. How can a nationalised or publicly owned industry be managed in a way that maximises management at management level at a plant and still allows a hand for the Treasury? The answer is that there will always be a dualistic form of management, and hence blurred objectives and conflicts between the management of a plant and of the operation itself, and the managerial oversight of the Treasury. It simply cannot work both ways: the Treasury cannot be managerially involved, and at the same time leave sound management to the plant or local managers. The hon. Gentleman, in his interestingly philosophical speech, thought that there was a middle way—a scheme by which the Treasury remained, but with its influence much reduced by allowing a public corporation to have access to the equity market.

The hon. Gentleman then launched a violent attack as a result of one of his occasional readings of The Times on the notion of massive profits. If he dislikes profits and thinks that they are much too high in a particular industry but at the same time believes that the only alternative to Treasury oversight is to have an equity dimension in the publicly owned industry, why is he so negative about profits? There is an inherent ideological conflict in his approach. He wants to get rid of the Treasury oversight because the Treasury is the accountant in the operation and he wants to get rid of profits because they are against the socialist instinct—he would almost go so far as to say that losses are better.

What is he left with? He is left with a wholly producer-oriented corporation which is answerable neither to the Treasury nor to the shareholders because profits are not important. It is interesting that that is almost exactly what happened in the electricity generating industry in the early days. Many people would argue that the way in which the electricity generating industry developed in this country—with very large power generation sets and great unreliability in design and operation—was entirely due to the fact that the engineers and people interested exclusively in the production side of power generation managed to persuade everyone that they had to have huge boilers and huge generating sets. In the end, those proved to be extremely costly and rather inefficient and took us along a path quite different from, for example, that of the German electricity generators which opted for small units on a dispersed municipal basis. That is the result of a producer-oriented operation which is the logical conclusion of the hon. Gentleman's approach. He does not like the Treasury or profits and his approach leads to an operation that is excessively producer oriented, which is not in the interests of the consumer or the small man in the long run.

The hon. Gentleman is the shadow Secretary of State for Transport and part of his speech dealt with the prospects for the coal industry. I wish to pick up one point that he made in that respect. He believes that the coal industry would be very much in the doldrums if it were privatised. He outlined a very disturbing but, I believe, inherently pessimistic view of the number of pits that would remain if we privatised the industry. I believe that the hon. Gentleman is wrong in thinking that the number of pits will drop to as few as 15. That was one of the possibilities considered in the Rothschild report, but I believe that it is wildly pessimistic.

Internationally traded coal prices are likely to rise in the next few years—that is certainly the view of the Select Committee on Energy—making imports much more expensive. If the power generators place themselves too unreservedly in the hands of foreign coal importers, they are asking to be taken for a ride in terms of prices. If we think that we can merely switch to foreign coal and ignore our home coal producers, there is no doubt that the price of internationally traded coal will rocket. We would be a captive market and importers would clearly increase the price of their coal. Therefore, the threat of massive foreign imports is really no more than a red herring.

The scope for foreign coal will, I believe, be about 10 million or 20 million tonnes a year and no more. Anyone who believes that it will be higher underestimates the disincentive to British power generators of being dependent on the volatility of foreign coal prices, the volatility of the price of substitutes such as heavy fuel oil and the uncertainty of the movement of sterling. There is still a considerable incentive for power generators to buy at home.

Furthermore, we should not underestimate the so-called "location" advantage for British coal which—as we are told in the Select Committee's report—averages about £7 a tonne. It raises the delivered cost of landed foreign coal to about £39 a tonne compared to the British home cost price of about £40 a tonne. The addition of the cost of moving foreign coal from a port to a power station means a substantial premium on the attractiveness of British coal because the location advantage enables us to deliver coal to power stations very much more cheaply than might be thought at first in competition with foreign importers.

Paradoxically, the hon. Gentleman's point about the transportation of coal by rail is an important factor because, curiously enough, the more expensive it is to move coal around the country—we hardly know whether we should want to make it cheaper or more expensive—the more disadvantageous it is to foreign importers because it must automatically increase substantially the price per tonne to move the imported coal from, for example, Hull to Drax. The more expensive it is to move it, the more advantageous it is to British Coal. The ironic question is whether we want expensive coal trains putting a huge extra cost on foreign coal landed in Hull and moved to east or west Yorkshire or whether we want to make it as cheap as possible—

Mr. Prescott

What about gas?

Mr. Alison

I shall deal with gas in a moment. Alternative fuels are not necessarily a long-term safe bet for power generators. Gas may not be as attractive as some people thought. Professor Littlechild, the Director General of Electricity Supply, could rule, for example, that gas station operators were not allowed to pass on to the consumer the full costs of gas power generation, which is now more expensive than coal power generation, as I am sure the hon. Gentleman knows. Gas power generation is becoming more costly. Coal is at present more competitive and if the Director General of Electricity Supply rules that gas power generating operators cannot pass on the full cost of gas but must match the price advantage that coal offers, so they are not allowed to charge more than could be obtained by coal production, gas will cease to be as attractive an option. That is where the regulator may have an important role to play.

Whatever the real prospects for the level of demand for home-produced coal, I am convinced that privatisation itself will not cause redundancies in the coalfields in the next five years for the obvious reason that the privatisation Bill for British Coal cannot be on the statute book before March next year. As the hon. Gentleman reminded us, the present coal contract must be replaced by next March. A new coal contract must be in place by then and that means that the level of demand for British coal in the next five years is bound to be set before the necessary privatisation legislation is passed. It will take at least a parliamentary year and I have no doubt—the hon. Gentleman was right to suspect this—that Ministers will take an active interest in the current negotiations between the electricity generators and British Coal about the contract to replace the present five-year contract.

Whatever deal emerges, it is certain that if privatisation proves to be at all viable, it will be so only if there are five-year contracts in place. The pattern will then have been set in advance of privatisation. If privatisation proceeds, it means, by definition, that there will he excellent prospects for British coal. I believe that uncertainties about the imports of foreign coal and about gas will mean that British power generators will look with some sympathy at the need to give British Coal reasonable five-year contracts with a reasonable level of demand, which will give the coal and the electricity generating industries some stability. Whatever happens will be decided before the coal privatisation Bill is passed, so one cannot argue that privatisation will cause redundancies. There have been redundancies in the coal industry for many years. Whatever else privatisation does, it will not cause redundancies, because if there is a privatisation Bill, it will be on the back of a five-year contract renewed after March next year.

I should like to draw to the attention of my right hon. Friend the Minister one other point simply because miners and managers in the Selby coalfield brought it to my attention directly and vividly in the course of canvassing during the election campaign. Selby coalfield is one of the best and most important coalfields in the country. It is now the subject of enormous quantities of capital investment. It has a great deal of modern equipment and some of the best and most efficient productivity records that the industry has ever known.

The main anxiety about privatisation that was expressed to me lies in the direction of mine safety. Miners and managers have told me that it is all very well to have the Health and Safety Executive framework in place broadly to oversee the day-to-day features and problems of safety in the mines. They are genuinely worried about a specific type of situation, such as the one we had, ironically, in the middle of the general election. A faulty roof in an underground shaft caved in. There were some injuries, but not serious ones. There could have been serious loss of life.

Miners and managers are worried about what will happen when the underground engineers and underground managers look at the condition of the roof of an underground shaft. In the old days when management was in place under the existing British Coal structure, it might have decided immediately to close the shaft, take it out of commission and over a reasonably long period to set about reinforcing, repairing or safeguarding the roof. Under a privatised industry with management geared to making profits, there might not be the incentive to adopt immediately a fail-safe approach and to take the shaft out of operation. Instead, management might be tempted to push ahead and use the shaft for a couple more days. In such a situation, the idea of profit might seem to be decisive and might undermine the critical importance of mining safety. The HSE, which would remain in place under the new arrangements, would not he involved in the intimate day-to-day judgment of what was necessary.

I hope that my right hon. Friend the Minister can reassure us about that. I do not believe that the pursuit of profit in private industry leads to the neglect of fundamental issues, such as safety and the well-being of the work force. It certainly has not had that effect in the oil industry. Moreover, we have had many terrible accidents in publicly owned industries.

On a philosophical note, the maximisation of profit has never been a rational, overriding business objective. If the maximisation of profit is made the only rational business objective, it often leads to the collapse of a company. If everything is piled into maximising profits, a range of other matters are neglected and, in the end, the public withdraw their support. Survival is the only rational business objective and it requires the subordination of profit making to consumer satisfaction, safety, the environment, the public image of the company and so on. I do not believe that profit will lead to the neglect of safety in the mines, but I hope that my right hon. Friend will be alert to the problem and can reassure us when the time comes.

Mr. Mark Wolfson (Sevenoaks)

My right hon. Friend's point is well made and is based on anxieties expressed to him on the doorstep only recently. In support of his argument, may I suggest that day-to-day management decisions on safety are made in the airline industry in much the same way as in the coal mining industry and that the record of the airline industry is good?

Mr. Alison

I am fully in sympathy with my hon. Friend's comments. He reinforces my point. It is false and unconvincing to say that a business run privately for profit will, by definition, neglect fundamental questions of consumer and producer safety and well-being. If that were the case, private industry would long since have been disallowed by public opinion.

Mrs. Dunwoody

Does the right hon. Gentleman accept that there are strict legal controls on the airline industry and that all those operating aircraft must register their involvement and stick to specific, tough safety laws? Does that make the difference? Does he agree that that should be clear in aviation?

Mr. Alison

The hon. Lady makes a reasonable point. It could be argued that the same applies under HSE requirements to mining. There are the same rigorous, detailed restrictions, limitations and requirements. However, my hon. Friend the Member for Sevenoaks (Mr. Wolfson) and I have been talking about something that is a little more marginal and subtle: the momentary decision by an aircraft operator whether to undertake one more flight or to take the aircraft immediately out of commission if, for example, there is a tiny seepage of oil from a component. No amount of words and regulations will ever cover such a decision. The same situation arises in the coal mining industry. The HSE provides a framework of rules, but often it is up to the judgment of the manager on the spot whether something should be taken out of commission on the grounds of safety.

My constituents have expressed anxiety to me about that and I hope that Ministers will bear it in mind when they consider the privatisation Bill.

5.6 pm

Mrs. Gwyneth Dunwoody (Crewe and Nantwich)

I am pleased to follow the right hon. Member for Selby (Mr. Alison) because he has illustrated one of the difficulties. Those of us who believe that safety should be paramount in any major industry know that, whatever he says, the question of profit will come almost inevitably between the operators and their desire to please their shareholders.

I am astonished that the Government should even now include within the Queen's Speech references to privatization, as if somehow the average consumer does not appreciate what privatisation means in practical day-to-day results in his own home. My hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) made an extremely telling and forceful case when he listed the effects, so far, of privatisation.

I make no apology for emphasising that my constituents know clearly why we do not want rail privatisation in any form. They have seen the effect of Government policies on existing industries. It is vital to point out that the privatisation of industries that already lack investment does not lead to a marvellous influx of a great pot of gold that will somehow provide better services. It inevitably leads to a series of short-term judgments. Management begins by deciding, irrespective of the industry concerned, that there is overmanning. If there must be one entry in the manual of privatisation for conservative management, it is, "Your industry is overmanned".

Let me explain what I mean. British Rail Engineering Ltd. was a large and effective supplier of rolling stock to the railway industry. It is true that its customer was largely British Rail, but it was capable of selling anywhere in the world and did so. It needed more vigour in its management structures to expand its markets thoughout the world. Yet, because of the Government's narrow-minded and unimaginative commitment to dogma, BREL had to be sold to the private sector.

We were told that privatisation would transform BREL and make it much more efficient, and that everyone would benefit in a country where the railways manifestly needed new rolling stock. What happened was rather different. A management buy-out was proposed to the work force and it was largely engineered by people who were in management. Their intentions may have been quite reasonable; they may have wanted to preserve the manufacturing unit and they may have believed that they had the expertise to do that. The reality was that, largely, those who wanted to invest in BREL did not understand the manufacture of railway rolling stock and were not particularly interested in the maintenance of the manufacturing unit.

In the intervening period, we have seen a classic example of what privatisation means. We have had a large number of redundancies, including redundancies among those skilled workers who are desperately needed to maintain the high quality of our product. The remaining services have been concentrated in a small geographical area, leaving large tracts of available land, which, no doubt, will soon be sold off at very profitable rates by the existing management.

A number of interesting financial calculations have also been made, which have directly affected the work force—not just those who remain with BREL but those who have lost their jobs at the factory. We were first told that the shares of the workers were so important and useful that they were worth a large amount. Indeed, a finance director came in and managed to do a deal which meant that for £100,000 he was able to buy the equivalent of £1 million worth of shares. In less than a year, those shares which were worth £10 each to the work force suddenly became worth £1.

At the annual general meeting, the chairman was asked about the value of the shares. He said that it was based on an independent assessment and was not one that the board itself had reached. That was a perfectly reasonable response, but the difficulty was that he went on to add that the board had subsequently discovered that those who made the assessment were accountants who had a contract with the firm that was seeking to buy large numbers of shares. That firm was ASEA Brown Boveri.

Many people would argue that in an industry concerned with the manufacture of rolling stock, it is better if engineers who know about manufacturing move in. We would agree with that. However, we would not agree with the change that meant that many of the work force were told at the annual general meeting, in my constituency, less than two weeks ago, "Oh, yes. It suited us to have you involved in buying shares when the management wanted them for a buy-out. It suited us to use you as part of the propaganda exercise and to say that we wanted individual working men and women to have shares and to be involved in their own industry. Unfortunately, ASEA Brown Boveri, which is coming in, will want to buy all your shares. If, by mischance, you do not want to sell them, we are sorry, but we have the powers within the existing terms to force you to sell the shares back to the new management." Even if one believed all the rubbish that the Conservatives talk about the little person having an involvement in privatisation, where is that magnificent arrangement now?

What has happened is simple. First, the employees were told that they should buy shares for a management buy-out. Secondly, many lost their jobs and saw the factory run right down. It no longer produces the rolling stock which is desperately needed by British Rail—and which all passengers know will be needed increasingly in the coming five years. The work force have finally been told, many having lost the privilege of working for British Rail, "We are sorry, but those who have shares will have to sell them back to the new company because that is how it will operate".

That is the reality of privatisation. It does not mean anything for the small, individual shareholders. It means that those who have economic muscle will survive and those who do not will be pushed out.

The position is even worse because we were told exclusively in the well-known socialist newspaper The Times that the chairman of British Rail had gone to the new Secretary of State and asked him for support in building new rolling stock. The chairman said he needed new investment in the south-east and in other regions and services. He said that there was clear evidence that the railway system needed new engines, carriages and services for the all-important customer. We were told that the chairman of British Rail had spelt out exactly what that meant in terms of economic investment and we were also told that it was made clear to him that the large amounts of money would not be forthcoming from a Conservative Government.

The Select Committee on Transport has taken evidence from British Rail, BREL and numerous other sources in the City on the total lack of interest in the railways felt by those who want to invest large amounts of money. Money has not been forthcoming for British Rail to build private links except in small, easily defined areas. Although private investment has been made by some freight carriers, it is not nearly enough to provide the high-quality service that is essential if we are to have any link between the channel tunnel and the north-west. One of our greatest manufacturing areas is to be deprived of a high-speed link and of trade in the movement of freight because the Government are not prepared to invest in new services.

Over and above that, we have been told that the railways will be much more efficient if a track authority is responsible for the railways and individual entrepreneurs organise services. Are we suggesting that firms such as Stagecoach, the manager of private coaches and buses, which is hardly able to run a service in one town, could run a service responsibly and efficiently outside its own area? Will firms such as Virgin, which is very good at publicity, be able to run a railway system when it believes that it is just a question of latching the odd coach on to the back of a British Rail Edinburgh express? Such firms will not make any difference to the customer and they are in for a shock. Are we suggesting that those people, who do not want to take on the responsibility for running a railway, will somehow or other produce an enormous new age of transport efficiency? If we are, we are not only kidding ourselves but trying to kid the people of this country.

The transport system of Britain requires large sums of investment. The taxpayer and the passenger know that. It is only the Government, who will sell off anything rather than provide a proper service for those who need it, who refuse to acknowledge the reality of today's transport problems. It is a disgrace that the Government are talking in such utterly shallow and irresponsible terms. Every other western European country provides a high-quality railway system, which is subsidised by the taxpayer, because it understands the link between the movement of freight, the movement of people and the development of its economy. Why is it that such a simple lesson is beyond the bird brains in the Conservative Government?

5.18 pm

Mr. Richard Ottaway (Croydon, South)

Having been present at the debate on foreign affairs on Friday without being called, I hope that I shall be permitted to be slightly international in my approach to privatisation.

Having been in this House representing another seat, to say that this is my maiden speech would be stretching the definition of virtue. However, I would not like the moment to pass without recognising the tremendous contribution that my predecessor, Sir William Clark, made to the government of this country. Like me, he formerly represented a Nottingham seat and made a significant contribution to economic thinking for more than two decades. His support for the policies of low taxation and restrained public expenditure, coupled with privatisation, had a strong following in the country and the constituency of Croydon, South, which I am proud to represent.

Privatisation has always been popular in a constituency like Croydon, because it works. Indeed, the only criterion on which privatisation can be successfully defended is whether it works and produces an efficient service. In my experience, it always stimulates the organisation concerned, and that produces a better service.

Privatisation in British Rail is bound to be welcomed in principle in a constituency like mine because, after all, it has nine commuter stations. The greatest concern in an area where Network SouthEast has such a strong influence in the transport of our constituents is that it should be an efficient service, and it is always a lively topic. However, if people like Richard Branson are making bids for the "Rolls-Royce" routes to northern England and Scotland, Network SouthEast is unlikely to be flooded with applicants. To try to run Network SouthEast on profitable and economic lines is unlikely to make economic sense.

Of far more concern to us in Croydon, South is the citizens charter. I was fascinated to read that the charter proposes to set standards, including for the first time individual standards for the 15 groups of routes in Network SouthEast. It goes on to set out percentage reliability criteria and I was riveted to see that the south London line hopes to achieve 97 per cent. reliability and that the Sussex coast line, which goes through my constituency, hopes to achieve 99 per cent. reliability. I must confess that it will come as a surprise to many of my constituents if British Rail achieves such targets.

The commercial heartland of Croydon is diversified and energetic. While it is quick to reject regressive economic policies, it gives a warm welcome to the fast-approaching establishment of a single market in trade, goods and services at the end of this year. Sole traders, small business men and directors of public companies can all see the advantages of a genuine market, which is one and a half times the size of the United States and three times the size of Japan. While we hold the Presidency, our priority must be to ensure that its full implementation is achieved and to remove the frustration of physical and technical barriers to trade. I welcome the commitment to that in the Gracious Speech.

The burning question now is, where do Britain and its partners in Europe go from here? There can be no doubt that the exchange rate mechanism has distinct advantages for business. I recently visited a successful promoter of television programmes throughout Europe, which makes substantial invisible earnings for this country. It always welcomes proposals from companies in countries in the ERM as it knows that the stability in exchange rates provides a basis on which it can do business and make a profit. Proposals from companies in non-ERM countries are received more coolly. Although we can all see the force of argument of those who say that we should come out of the exchange rate mechanism, I venture to suggest that those are the voices of people with little hands-on pragmatic experience of business and industry.

Mercifully, we do not yet have to make the decision about whether to adopt a single currency. Much as the separate economies of Europe may try to converge, despite the tensions and cross currents that flow throughout Europe today, I doubt whether it can be achieved— certainly not within the proposed timetable for monetary union.

Despite my support for the Government's position, I am not a federalist and could not support a united states of Europe. Nothing antagonises the British people more than proposals from Brussels to ban smoking in public places or dictating who is eligible to play in an English football team. I have more faith in Steve Coppell, the manager of Crystal Palace, than in Jacques Delors on that issue. Today Europe must look far beyond the visions of Brussels bureaucracy. Here, privatisation has a role as we successfully export it overseas.

This year is the 125th anniversary of the first appearance of Karl Marx's "Das Kapital", which laid the foundations of theoretical socialism. It contained the impossible promise of an idealistic world, without capital, and opposed to free market economies. Inevitably, it was a dream that ended in failure.

Now, the biggest challenge to the west politically, ethically and morally is the region of central and eastern Europe, stretching as far as the Chinese border. People in those regions must be given hope and I welcome the proposals in the Gracious Speech to give aid to them. We must not let the situation come about in which they begin to yearn for the old days of communism, feeling that they were better off then than in the harsh reality of the present.

Perhaps the best thing that we can do for them is to show how effective privatisation can be. The political imperative is that they see the opportunities that exist in western Europe and for us to set examples that demonstrate the effectiveness of the market economy. Let us give them the aid to transfer their capacity for producing tanks into peacetime production capability. They cannot do that on their own because their will has been progressively eaten away by communism and the difficulty that they face now is a lack of cash. There is concern on both sides of the House that aid to that part of the world is water on sand. But from my commercial experience in the past five years, I know that there are abundant supplies of natural gas and oil that can help finance the provision of an industrial base on which to build.

We in the west have had the good fortune to be born on this side of the old iron curtain and we can thank our lucky stars for it. The military threat that united all peace-loving people no longer threatens us. Instead, we are overwhelmed by the picture of misery and helplessness. The aftermath of the cold war has been as devastating and complete as any war fought by conventional means.

I believe that an equally dangerous and divisive threat is the possible alienation of the United States of America, as we focus all our attention on Europe. It would be a grave mistake if we let that happen. If ever we need an example of the success of privatisation, we need look only at the power of the United States' economy, where nationalised industry is virtually an unknown concept. In the exchange between the Front Benches, it was well illustrated how the nuclear industry in the United States can survive without Government intervention or capital.

We started this century as a dominant world power, with the United States as a non-servile, dependent nation. It was Theodore Roosevelt who, at the beginning of this century, acknowledged the British Government as an ally sympathetic to the United States over Cuba. As a result of that close friendship, he supported the allies in the first world war against Germany, but by the end of the second world war the tables had turned after the United States bailed us out a second time. They were now the dominant party.

Since then, the United States' contribution towards world peace and stability in Europe has been immense—the Marshall plan after the war; the instigation of the Bretton Woods monetary agreements, which gave us the World Bank and the International Monetary Fund; and the establishment of the United Nations and NATO. Above all else, it was their relentless opposition to the advancement of communism and the misery that it brought that marked out the United States as the superpower of the world. Yet, when they needed advice and support, they always turned to the United Kingdom and our special relationship is alive and well and must not be jeopardised.

In the formal sense, the relationship is the exchange of intelligence, and the establishment and maintenance of a nuclear deterrent. From my time in the Royal Navy I know how inextricably linked the two navies are, with the exchange of information and personnel being commonplace. The Falklands and Gulf wars illustrated what little support we could expect from the rest of Europe when the going got tough. Informally, strong cultural, diplomatic and corporate links, not to mention a common language, bind the two nations together. It is one of the closest political alliances in international politics.

We must not throw that good will away because we are unable to reform the common agricultural policy, which is such a stumbling block to the successful and essential conclusion of the talks on the general agreement on tariffs and trade. Believe you me, there are plenty of people in Washington who would use that as an excuse to pull out of Europe.

The North Atlantic Treaty Organisation could be wrecked by the Community's resistance to cuts in farm subsidies. I am afraid that some countries in the European Community would not he sad if that happened It is bizarre that we should jeopardise that special relationship in preference to a policy whereby more than 50 per cent. of the European budget is spent on agricultural subsidies.

When the Prime Minister last met President Bush he gave him a cricket bat. I am not sure what President Mitterrand or Chancellor Kohl would have done with a cricket bat, but at least President Bush knew that it was for hitting a ball. The United States can sometimes be an infuriating ally, but I admire its effort, energy and "can do" attitude. We must not throw away that relationship when the sirens of Europe beckon. The United States will remember its friends.

5.33 pm

Mr. Nick Harvey (Devon, North)

I am grateful to you, Madam Deputy Speaker, for giving me the opportunity to make my maiden speech in the debate on privatisation. As the Liberal Democrats' transport spokesman, I view with interest the somewhat predictable measures on the privatisation of British Rail proposed in the Gracious Speech. As the Member for Devon, North, I know that my constituents are concerned about the future of the Exeter to Barnstaple line—with which you, Madam Deputy Speaker, as a Devonshire Member, will be familiar—under any future regime that might operate on the railways.

I am glad that the Government are forsaking for the moment the wholesale privatisation of British Rail in favour of access to the network. However, the Liberal Democrats share the worries of the Community of European Railways, of which British Rail is a member, on open access and privatisation. It states that competition to drive down costs and make railways viable is the way forward. But if the Government continue to refuse to give all modes of transport the same treatment, British Rail will operate at a disadvantage. I wonder whether some of the private companies that it is envisaged might bid to operate the rail network will look forward to paying in full the infrastructure costs, as British Rail has to. Their competitors in the air and on the roads pay only part of the costs of airport and road facilities.

It is a strange twist of fate that the Government's plans for British Rail's future are being proposed now, at the end of a full and comprehensive, sweeping reorganisation of British railways known as "Organising for Quality". It is popularly known in British Rail's executive circles by the abbreviation "O for Q"—not an abbreviation to be used in a hurry.

The privatisation of British railways is not in the public interest now. We need a Government with the foresight to see the business, environmental and human consequences of their actions. We need sustainable investment in the railways, as in other public transport sectors. If British Rail is to compete with private companies, it needs the tools to do so.

We have heard today from the Secretary of State that the private sector will have capital investment in the railways through franchising, but it is clear that British Rail needs access to borrowing and leasing, as the SNCF has in France. We look forward to the Government introducing a White Paper in the summer, perhaps when they have worked out the answers to questions such as that posed by the hon. Member for Southend, East (Sir T. Taylor).

We also look forward to seeing the Government's proposals for the future of the railways, a subject dear to the heart of my predecessor. One of his proud achievements was to introduce in 1981 private Member's legislation on the reopening of old railway lines. He, like everyone in north Devon, will be disappointed that that legislation did not lead to the reopening of the Torrington loop or the railway lines to Ilfracombe and Lynton, both of which are beautiful. I pay tribute to the hard work undertaken by my predecessor on behalf of north Devon, and on promoting the cause of alternative energy. He went about his business in an energetic and unique way, and his memorable comments will be missed.

In his maiden speech my predecessor paid generous tribute to his predecessor, a distinguised member of the Liberal party, and I shall do likewise. Many right hon. and hon. Members will remember him as cutting a dashing style and being a formidable performer. I cannot aspire to match his panache, but I hope to fight for the area the same tenacity. In his maiden speech in 1959 he spoke in shocked terms of the 9.3 per cent. unemployment rate in the town of Ilfracombe, and argued for the district to have development area status. Today, the unemployment rate in Ilfracombe is 22 per cent., and at times youth unemployment is as high as 50 per cent. Once again, the community of Ilfracombe is fighting to obtain development area status.

Within months of Mr. Thorpe's speech, the Conservative Government granted that status—if only we could look forward to that again. Such status served the area well from 1959 to 1984, since when no significant new employer has moved into the area. My constituents have high hopes of regaining assisted area status for the district, and of seeing the building of a downstream bridge over the Taw river in Barnstaple—a vital piece of local infrastructure if the town is not to grind to a halt and deprive businesses to the north of Barnstaple and the holiday industry of important income.

My constituents had hoped that more might be done about the state of the beaches around the north Devon coast. The south-west has a small population, but it has responsibility for many miles of coastline. When South West Water was being prepared for privatisation, it was given a green dowry to help to plump it up for the process. It now needs green alimony or, perhaps, green child maintenance to ensure that it can continue to bear the heavy burden.

In a few months' time, the Landkey primary school in my constituency will be celebrating the 30th anniversary of the acquisition of the site for a new school. Unfortunately, the existing school has a leaking roof, damp exercise books and open drainage for its outside facilities. I am 30, and the site was acquired in the year that I was born. When I was shown around the school by the chairman of governors, he pointed out the very rail where, as an infant, he used to swing. We hope that, in their education proposals, the Government will ensure that local education authorities have the resources to put right that problem, and many others.

The hopes and needs of north Devon are manifold. Like many other new Members, I was struck by the weight of my mailbag, which was phenomenal. This week, I went to the Post Room to ask for my mail. Nothing arrived for some time, while many right hon. and hon. Members received their mail. For a brief moment, I allowed myself the hope that perhaps my mail had dried up. A plump thud came from above and I was handed a bigger bundle of mail than anyone.

No doubt I shall become used to the strange ways of the House. One of the most surprising things that happened to me was when a party of school children from my constituency visited the House soon after I was elected. One of them had brought as a gift a bottle of champagne. It was not allowed through the security device, but was handed straight to me by the policeman, with the reassuring words, "You had better hold that—it might be a bomb." It had occurred to me that the security arrangements here might be thorough, but I had not thought that suspect devices would be given to Members for safekeeping.

I also managed to get lost in my early days here. Having entered the labyrinth of corridors, I noticed that the carpets had changed from green to red. I had promoted myself, somewhat prematurely, to another place. Unkind cynics might say that when one loses one's way around the Corridors of this place, it could be time to move on there. But I hope to have the honour of representing the people of north Devon for many years before any such thing should happen.

5.39 pm

Mr. Richard Spring (Bury St. Edmunds)

May I take this opportunity, Madam Deputy Speaker, of congratulating you on being in the Chair? I wish you well in your new office.

I am privileged to represent the constituency of Bury St. Edmunds and to follow in a line of distinguished parliamentarians. I should like to pay a special tribute to my predecessor, Sir Eldon Griffiths, who entered this House in a by-election in 1964. He was a remarkably successful constituency Member, a Minister and an expert in international affairs. He will be sorely missed by many, both in the constituency and in this House.

The constituency that I represent is probably the only area within a 100-mile radius of London that still feels essentially rural. Bury St. Edmunds itself is a successful, beautiful and largely unspoilt Georgian town. The origins of the town's name lie in the Saxon martyr King Edmund of East Anglia who was killed by invading Danes in 869. A particularly rich and powerful abbey was established there after the Norman conquest, and it was in that very abbey that the barons met to plan the Magna Carta. Bury, therefore, is known as the cradle of the law.

This love of freedom and of liberty remains strong even today in west Suffolk.

Many people will think of Suffolk in terms of our glorious wool churches, but many will rightly think of Newmarket, which I am also proud to represent. It is the horse racing capital of the world, a glittering jewel in our county's crown. The horse literally dominates the town, although, sad to say, the industry today has special difficulties and much needs to be done to help it to survive and prosper. The British bloodstock industry is the finest in the world and a significant employer in my constituency.

Yesterday, in our cathedral of St. Edmundsbury, we celebrated the 50th anniversary of the arrival of the Americans during the second world war. Thousands of them were based in Suffolk and many of them married locally. There are still signs of their former presence all over the constituency, but their presence today is still a critical part of the lifeblood of west Suffolk. There are two large United States air force bases, at Mildenhall and Lakenheath, which employ thousands of people and contribute about 140 million to the local economy.

The bases are popular with local people; their role, past and present, in defending freedom and democracy is well understood. In Sir Eldon's maiden speech 28 years ago he said: In the Anglo-American alliance we must … have enough British power to deter an attack on our island and to ensure that we are not subjected to international blackmail."—[Official Report, 16 June 1964; Vol. 696, c. 1156.] Fortunately, that threat is now much less likely, given the end of the cold war, but, as we have repeatedly seen, Anglo-American friendship has been very important, latterly in the Falklands, Kuwait, and Libya.

In my constituency there is a great range of diverse activity in addition to the important agriculture sector. Some in metropolitan circles may just take the view that those of us who live in Suffolk spend our days gazing fixedly at endless acres of cereals. Nothing could be further from the truth. Our corner of England has been one of the fastest growing and most dynamic in the country. That has almost entirely coincided with the great success that Conservative Governments have had in transforming our country in the 1980s.

We have also benefited from the economic tilt eastwards as our trade with Europe has increased. Freight passes through and is manufactured in my constituency and goes to the port of Felixstowe. What once happened in our ports—it threatened Governments and created havoc with our currency—now seems to have taken place on another planet; jobs for life seem light ages away. Privatisation has brought new methods, new investment and success.

Survey after survey shows that as we continue to come out of the recession west Suffolk will grow and prosper. Central to that prosperity are good communications. Private participation has been brought in to speed up the substantial road improvements in our county, and there is more to be done. Mildenhall and Brandon need bypasses.

The growth of population has come about in part because people have moved to Suffolk with the intention of commuting to London. Unfortunately, some of them have had to give up the unequal struggle because of the poor performance of British Rail. The Norwich to London line through Suffolk is characterised by erratic timekeeping. I have frequently experienced this myself, and it is not for lack of investment. It is due to the poor management that is so tragically characteristic of nationalised industries.

On Easter Saturday some of my constituents were travelling on a diesel train between Cambridge and Ipswich. At Bury St. Edmunds station the engine started smoking. Undeterred, the train continued its journey, and a few minutes later the engine exploded and a piston from the engine entered the passengers' compartment, causing injuries. What ensued would have been farcical had it not been so serious. I shall not dwell on it except to say that when my constituents set off on an Easter Saturday to visit their relatives in Clacton they should not be made to feel as if they have landed in the midst of a Scud missile attack, albeit in rural Suffolk!

Leaves, snow, fires on the track—we are all used to these; and doors that do not open when the temperature drops we have read about. It is highly regrettable, however, that, four weeks after the event I have described. I have yet to obtain any information about the safety and operating procedures to be followed when a train engine malfunctions.

British Rail needs private input. It clearly needs to serve both passengers and its workers better.

Before I conclude, I want to say a few words about a constituency that I fought as a parliamentary candidate and for which I have the greatest affection—Ashton-under-Lyne. It is represented here by a right hon. Member of great experience and distinction, but, with full respect to him, I would also express the hope that one day it will return a Conservative Member to this House.

I am the third Member of Parliament for Bury St. Edmunds to rejoice under the curious surname of Spring. The first two appeared to survive the difficult politics of the 17th century with considerable ingenuity, if not with obvious convictions.

Incidentally, I am sorry not to have congratulated earlier the hon. Member for Devon, North (Mr. Harvey) on his excellent speech. We look forward to hearing many more such excellent speeches from him in future.

On the subject of convictions, my constituents need have no fears. I look forward to representing their interests and their needs in this House for many years to come, and to doing so always as a member of the party in government, with ever-growing numbers of colleagues joining me here.

5.48 pm

Mr. William Etherington (Sunderland, North)

I realise that the first thing that I have to do in my maiden speech, Madam Deputy Speaker, is to address you properly and to congratulate you on your new post. I wish you every success and fulfilment in it.

I have been waiting since 14 December to make this speech and it could not have come at a more appropriate time than in a debate on nationalization—on the end of a nationalised coal industry and rail industry. I am proud to represent the constituency of Sunderland, North, which has a wonderful record of parliamentary support dating back to the 1640s, when the people of Sunderland ensured that coal was sent to London to support the parliamentary cause, after the citizens of Newcastle and South Shields put a blockade on coal to ensure that the Parliamentarians were not successful. At one time 40 good Wearside ships were tied up by the blockade of the Tynesiders, but in the end we were successful and the seamen joined the parliamentary forces and were able to drive the Royalist forces out of the north-east—and so on to victory. Everyone should be as proud of that as I am.

In 1832, Sunderland was granted two MPs and the records from then until 1945 show some strange combinations. Sunderland returned primarily Liberals until the turn of the century. At odd times a Conservative sneaked in when the Whigs and the more radical element in the Liberal party could not agree and put up too many candidates. Perhaps that is a lesson for modern times. It was not until 1906 that the Labour party, of which I am proud to be a member, took a Sunderland seat. The going from then was not easy. There were failures and we did not have two Labour Members until 1950. That was sad because many other parts of the country did rather better. There were only two Conservative Members representing Sunderland from 1900 to 1906, from 1922 to 1929 and from 1931 to 1935. Our record since then has made up for that.

I intend to make the most of my maiden speech because I understand that in future speeches I am likely to be heckled, but that is par for the course with me. After the Representation of the People Act 1948, the two constituencies of Sunderland, South and Sunderland, North were formed. I am delighted to say that since then Labour has always won the North seat. The tremendous response by the people of Sunderland to the Labour party is demonstrated by the fact that Fred Willey, whom some older Members may have known, was successful in no fewer than 11 general elections spanning 38 years. That is a tremendous record. Sadly, I did not meet him because, although I was born and lived in the constituency, I did not live there at that time.

My predecessor, Bob Clay, unexpectedly retired late last year, thus giving me the chance to attain my ambition of getting here, albeit rather late in life. He is now doing his best to revive shipbuilding on the River Wear, an industry which, sadly, has almost gone. I should not need to remind the House that during the war the Sunderland shipyards produced 25 per cent. of the replacement capacity when we were losing ships in that terrible time. The shipbuilding record on the Wear was second to none and it is sad to see it in such a poor state. When trade takes up again, hopefully after 1995, perhaps there will be a revival.

Bob Clay will never be forgotten for his work in the constituency to try to keep the shipyards open or for his tremendous work in trying to help the nuclear test veterans, a worthy cause if ever there was one. I shall try to continue in the same vein in representing my people.

I should like to pay tribute to one or two other former Members, one of whom was George Hudson, "the railway king," an MP for Sunderland for many years. He would have been interested in today's debate. George Hudson had one or two financial problems which shows that there is nothing new on the stock exchange. He found it necessary to leave the country for a short time and was in Spain and France for almost two years trying to sort out his businesses there. He did not do too well in Britain but managed a little better abroad. While he was away, a general election was called unexpectedly. There was much opposition to George Hudson because it was said that he had not been to Parliament or to the constituency for more than two years. However, the Sunderland people are rather forgiving because when he promised to mend his ways they duly re-elected him. Unfortunately, due to his pressing business problems which he never seemed to resolve, he had to give up, although he was voted out in the meantime.

Another person worthy of note is Samuel Storey, a Liberal who started a newspaper empire. He was unusual because he got to Parliament in 1880 at a by-election at which he was unopposed. That sort of thing happening today takes some imagining. I certainly do not remember it in my lifetime. He won three general elections between 1885 and 1895 and was returned again in 1910. He changed his colours to become an Independent Tariff Reform candidate but had to give up after 10 months because of bad health. His grandson, who became Lord Buckton, was Conservative Member for the town from 1931 to 1945, contining a worthy tradition which exists to this day because the family still lives in the town and is still involved in the newspaper industry.

My favourite is Thomas Summerbell, the first Labour MP from 1906 to 1910. He was a great worker for the town. He helped to set up the town council and continued the radical tradition which has always existed in Sunderland, with one or two short exceptions. He carried out tremendous work for Labour on the town council. Tragically—and there is much tragedy in politics—a few days after his defeat in 1910 he attended a town council meeting and died from an attack of apoplexy. It seems that fate stalks in pairs, because Thomas Summerbell's agent, Thomas Dale, was killed in 1916 in a zeppelin attack, and that set back Labour's prospects.

The Labour MP from 1929 to 1931 was Dr. Marion Philips. There are not many women in Parliament now, but there were even fewer then, so her election was something of a landmark. Dennis Pritt became one of the greatest socialist lawyers in history after his unsuccessful attempt to enter Parliament.

I shall now turn to the more contentious issue of denationalisation. I like to use the old-fashioned word rather than the new term of privatisation. The Government wax lyrical about free enterprise and competition. I am not so sure about free enterprise because I worked in it for a short time. I found nationalised industry much better organised and we were much better treated, although we had to work just as hard. I see the sense in competition, but where is it? Water, gas, telephone services and electricity have been denationalised. I have only one water supply in my house and I cannot decide whether to turn on Northumbrian water or Thames water. Therefore, there is no competition.

I do not have gas because my village is not that far advanced. I have electricity but only one supply; and in terms of the telephone, least said, soonest mended. Conservative Members speak about the benefits of private enterprise and competition. Where is the competition? Industries that were great national assets and public monopolies have become private monopolies. The only competition I have seen is the scramble for shares and the scramble among directors and chief executives to see who can get the highest salary. The competition among those who work in those industries is to see who does not get made redundant.

Workers' conditions have worsened and prices have increased. The whole thing has been a complete charade, and I am worried that the coal industry and British Rail will go the same way. Do hon. Members forget that coal and the railways had to be taken over by the Government in two world wars because in private hands they were inefficient? Has anyone forgotten the ramshackle state of the coal industry when it was taken over in 1947? Why has everyone forgotten that between 1923 and 1947 only the Southern region, as it is now, paid ordinary shareholders any dividends? But the Government propose a return to that system. For years, the Tory party led us to believe that privatisation had to be good and nationalisation had to be bad. It was difficult for those who were too young to remember to argue against that, but now we see the alternative, and it is much worse than the service to which we were accustomed.

I worked in the coal industry for 21 years—I doubt that many hon. Members can say that—and for nine years before coming here I represented workers in that industry. What worries me about privatisation of the coal industry is the appalling safety record that the privatised industry had before 1947. There was carnage and there were terrible injuries. Between 1947 and 1979, that gradually improved. Sadly, since then, it has deteriorated again. There is no denying that: the figures come from the Health and Safety Executive, not from the National Union of Mineworkers or the Labour party. They come from a Government body and they tell the story.

Wearmouth colliery is the largest employer in my constituency and two months ago, in a tragic accident, two men were killed and two others were made paraplegic. One of the men killed and the two men who were made paraplegic were my constituents. I have been to see the two who are still alive and the widow of the one who died, and what concerns them most is that Government spokesmen could not wait to get on the television, not to express sorrow, but to say that the record of coal industry safety was improving—a claim that can be proved to be untrue.

I make a plea to those on the Government Benches: do not denationalise the coal industry. Like my colleagues, I know what that will do. I am afraid that the Government do not. I am worried because, at the same time as talking about denationalisation, the Government are working with the Health and Safety Executive to dilute legislation on safety in mines. In 1830, my townsmen, led by Dr. Clanny and others, were involved in the first Sunderland committee, which started the long haul towards good safety in the mines. They were responsible for getting the first Acts dealing with safety in the mines passed. Only France had such legislation before Britain. Between then and 1979, there was continual improvement in regulation of the mining industry. At the very time when the Government are talking about denationalisation, they are also talking about dilution of legislation and regulations. That is a recipe for disaster. I ask members of the Government, as decent reasonable human beings, to reconsider.

6.2 pm

Mr. James Hill (Southampton, Test)

Mr. Deputy Speaker, may I add my congratulations to the many that you must have received over the past few days? We have a worthy Deputy Speaker and I congratulate you now as I would congratulate you in person.

The hon. Member for Sunderland, North (Mr. Etherington) made an impassioned speech, on which I congratulate him. His intensity and directness, and the challenging tone of his speech, made me feel that, when the hon. Member for Bolsover (Mr. Skinner) retires, he will have left a worthy successor.

Mr. Skinner

That is because I taught him.

Mr. Hill

The hon. Member for Sunderland, North may be a pupil of the hon. Member for Bolsover—

Mr. Skinner

One of them.

Mr. Hill

We must nevertheless be grateful that we are getting fresh blood—perhaps not quite as fresh as we would like—on the Labour Benches, although we are hearing some of the old stories.

There is no longer any doubt. No plea can be made. The Government have made up their mind on privatisation of parts of British Rail. The hon. Member for Sunderland, North mentioned the Southern region. That is a prosperous region and should, in no time, be looking to the Government and the marketplace for finance for investment in new track, rolling stock and other equipment. We have had a difficult time because some of the new rolling stock was incredibly badly designed. There were many cases of people being trapped—some inside a carriage and some outside—while in some carriages there was a danger that they might fall out. This went on for some time.

Then, last year, we heard about the terrible hazard of leaves on the track. Not just thick snow but the mildest of winters seem to he able to put vast sections of our network out of play. Southern region would be the ideal region with which to begin a privatisation programme. The private investor wouild invest in Southern region. Passenger services could be run not only with private investment but on the basis of franchises.

British Rail's standards of punctuality leave much to be desired. I know that the passengers charter says that there will be compensation for late arrival, or even late departure, but it will take a tremendous bureaucracy to check on that and thousands of commuters will be making claims practically every other day. As has been said, it will be difficult to organise all of British Rail. The Government will not be able to franchise some sections of track, but those sections cannot be ignored either. For community value reasons alone, some of these out-of-the-way, non-profit-making sections on the periphery of the railway system will still be the Government's responsibility.

Therefore, the plan is to sell off parts of British Rail. For example, the freight and parcels operation could be sold. Once again, as in the case of every other public industry that has been sold off to the private sector, we shall have to have an overseer on the lines of Oftel. There will have to be a group that ensures the highest standards in, for example, punctuality, efficiency and safety.

Whenever an industry is privatised, it is claimed that safety standards will fall, but that has not happened in many parts of our vast privatisation programme—in British Airways, for a start. The British Transport Docks Board was privatised, becoming Associated British Ports. Many of these industries had an appalling safety record, but profitability includes profits of all kinds. In Southampton, we have the example of Associated British Ports, which, as everyone knows, controls 19 other ports besides Southampton. It has made tremendous progress and can justifiably say that it has put new heart into the city of Southampton. It has built private dwellings and offices and is building a container port, thereby attracting more cross-channel services, and more and more cruise ships are calling in. Since the demise of the national dock labour scheme, it is able to compete with practically every other port in the area, not only in the United Kingdom, but on the continent.

That privatisation and others such as those of British Airways and the National Freight Consortium show that one does not have merely to believe; one can see the results of privatisation. The problem is that those who will not see will never see. They will go to their graves muttering that privatisation will never work.

Mr. Jimmy Hood (Clydesdale)

The hon. Gentleman is talking about seeing. Perhaps he will tell us before he resumes his place where he sees competition in the gas, water and electricity industries, and in British Telecom, in Southampton.

Mr. Hill

British Telecom is certainly involved in competition. There is franchising, and other firms are installing telephone boxes in the street in competition with British Telecom. The process is gradual. The nation must have the confidence to take on former well-established public industries. In many instances, that requires a colossal amount of collateral. It is true that British Telecom has many rivals.

British Gas has Ofgas to control its price structure, and we have all seen how effective that control has been over the past few weeks. The same is true of practically every other denationalised industry. For example, an extremely effective body is overseeing water charges. For the first time, the water industry is making contributions to the National Rivers Authority to ensure that our rivers become unpolluted. The sea shores of the United Kingdom will become less polluted. In Southampton, the former Southern water board used to stockpile sewage during the hot summer months and then dump it in the middle of the Solent. I shall not go into the question of which Government did or did not pay to maintain water sewage and normal renewal pipelines, for example, but we have reached the stage when a desperate problem is being tackled. The NRA should be congratulated. It must be recognised that pollution can be dealt with only from within the industry, which manufactures its own profits and uses them to renew pipes, for example.

I wonder whether the debate will reach a sensible conclusion. We are dealing with one of the most political issues that have ever come before us, apart from council housing. The issue is such that the view of practically every Member is set in cement, as it were, when we come to consider it. I am certainly set on the issue of privatisation, and I am aware that other hon. Members will face an extremely difficult problem.

I have not talked about the coal industry because we do not have any coal mines in the south of England of which I know. I shall leave it to more worthy Members to tell the Government in Committee exactly why the coal mining industry should not be privatised. I recognise that following almost any privatisation there is an examination of the number of people who are working in the industry, and there is some over-staffing in practically every industry of which we can think.

When there is a change from public to private control, people are made redundant. That has happened in Southampton, where many dockers were made redundant. Fortunately, they received an extremely handsome golden handshake. It is perhaps curious that 450 of them took their redundancy payments and formed their own stevedoring company. I am pleased to say that that has made 450 capitalists. They are extremely happy to work through the day and night and have a tremendous reputation in the port of Southampton. I see the reaction of those on the Opposition Front Bench. If members of the shadow Cabinet do not believe me, I invite them to talk to the men concerned. A tremendous effort is being made in Southampton to make the private sector work extremely well, and I shall be pleased to see that extended to the Southern region of British Rail.

6.15 pm

Mr. John Heppell (Nottingham, East)

It is with great pleasure that my first words in the Chamber, Mr. Deputy Speaker Morris, are to congratulate you on your appointment and new position. I suspect that, like most new Members, I look upon the making of my maiden speech as something of an ordeal. The ordeal has been made much less daunting by the many hon. Members who are now in the Chamber. Perhaps that is a reflection on my personal popularity.

I understand that it is traditional to pay tribute to one's predecessor, and I am happy to do so. Michael Knowles became the Member for Nottingham, East in 1983 and surprised everyone, including himself. In 1987, he surprised himself again by holding the seat. I am relieved to say that I was able to spare Michael a third surprise. Last weekend, I read, for the first time, his maiden speech, which was made in 1983. That speech alone is enough for Michael to deserve tribute. It must have required great courage to make a maiden speech in defence of local government. It made him no friends in the Government of the day and it flew in the face of party dogma. I would have been proud to make that speech, and I shall refer to it later.

I pay tribute also to Bill Whitlock, whose old constituency of Nottingham, North forms most of the area which I now represent. I thank him for his hard work in the constituency and for his personal help.

I understand that someone who is making a maiden speech is given a great deal of leeway, and I do not propose to abuse that tradition. I shall confine myself to three main concerns. First, I am an ex-railwayman, a member of a rail union, a supporter and advocate of public transport and a user of public transport, so the House will not be surprised to learn that my first concern is the privatisation of British Rail, in whatever form. At the entrance to the Chamber there is a statue of Winston Churchill. I am told that as Conservative Members enter the Chamber they touch Winston Churchill's foot so that some of his talent and skill might rub off on them. It is ironic that a party that so reveres that man and the work that he did should now try to undo some of that work.

It was Winston Churchill who put country before politics and nationalised the railways. He did so not in the name of party dogma but for the public interest. How sad and tragic it will be to see dogma triumph over common sense.

If common sense is applied, what will privatisation mean to the railways? Will it improve efficiency? I think not. Will it improve effectiveness? I think not. Will it make trains run on time? I think not. Will it make the travelling public—the passenger—better off? I think not. Nye Bevan said, in effect, that we do not need a crystal ball to see what the Tories are going to do. It is all there in the record books. We do not need a crystal ball to tell us what privatisation will do. That is all in the record books too. Public monopolies are now private monopolies and underpriced shares have cost the country billions of pounds. Higher profits have been followed by job losses. Investment in research and development have been slashed. The price of privatisation is a worse service.

Who benefits from privatisation? Is the consumer a beneficiary'? The Chancellor of the Duchy of Lancaster told us today that the consumer does benefit. Is that true? No matter what the Chancellor of the Duchy of Lancaster says, water charges have risen above inflation while water company profits have continued to rise. The benefits are enjoyed by the shareholders. Gas prices have risen above inflation, yet the profits of British Gas continue to rise. The benefits go to the shareholders. Telephone charges have risen above inflation, yet the profits of British Telecom continue to rise. The benefits go to the shareholders. Electricity prices, despite the drop in the price of coal, have risen above inflation, yet the profits of regional electricity companies continue to rise. The benefits go to the shareholders.

The picture is clear—it was heightened yesterday by remarks by the Archbishop of Canterbury—and it is that the consumer is suffering at the expense of the shareholder. What price the citizens charter now? There is nothing in privatisation for the consumer, but there is plenty in it for the managers and shareholders.

My second concern is just as important, but more frightening. Last weekend the Conservatives celebrated—and presumably are still celebrating—the local election results. 'They have a right to celebrate because they achieved a good result. However, we must not forget that they are still only second in local government—the Labour party is still number one. Nevertheless, the Conservative party made significant advances, almost as good as the advances made by the Labour party in the general election. It deserves its right to celebrate and I would not want to pour cold water over that.

I have a worry, however, that concerns not just the Labour party but all who support democracy at both local and parliamentary level. It was evident to me, as I am sure it was to other hon. Members, that there was apathy during the local elections. The turnout was dreadfully low. That shows a picture of despair. A large number of people throughout the country are beginning to believe that their votes mean nothing and that they can change nothing. That is dangerous for us all.

We need only to look at the recent events in America, where traditionally there are low turnouts in elections, to see the dangers that that presents. The riots in Los Angeles did not result from one jury giving a ludicrous verdict; they did not result from a few policemen showing evident brutality to somone in their custody; they were not simply race riots—they happened because America has long accepted an underclass. In a land of plenty, there are those who have nothing. There are those who have no stake in the American dream, those who are homeless, those who are unemployed, those who exist by begging, by benefits and by worse, and those without hope who have lost. their faith in the ballot box. That was the reason for the Los Angeles riots and we should not complacently believe that that could not happen here.

It was in my constituency that William Booth launched his crusade against poverty in the early 19th century, yet still in my constituency there are 8,500 unemployed, families living in poverty and people living on the streets. As a nation, that is something that we cannot—and, I hope, will not—tolerate.

Michael Knowles, when referring during his maiden speech in 1983 to the injustice of the rate support grant, said that he did not believe that there was an imminent danger of the people of Nottingham burning down the castle as the Luddites did in protest at the indignities and injustices of their time. I am happy to tell the House that that is still the case. However, we cannot be complacent about the social problems that we must overcome if we expect that to remain the case. Poverty must be tackled by Members on both sides of the House.

My third concern is that if we are to ensure that people feel that they have a part to play, if we are to improve the environment for our citizens and if we are to help people to recognise that they have a voice, we cannot do it from the House. It must be done in the community, nearer the people. The best vehicle to deliver that is local government.

In my short time as a Member of Parliament I have been amazed by the antipathy and antagonism that many hon. Members, on both sides of the House, display towards local government. That is also, I believe, a threat to democracy and to our way of life. My predecessor saw it in exactly the same way. He spoke of despair in local government, of a feeling of already having been judged guilty, of the Government tightening the noose and of the end of 1,000 years of local government. All my experience shows me that he was right then, and he is right now. Why cannot we, at a national level, trust the people? Why do we interfere with the very democracy that we profess to support?

In my constituency, Nottingham city council has raised £42 million from the sale of council houses. Why is it not allowed to spend that money to help the homeless, if that is what it has democratically decided to do? Why cannot Nottingham county council use its money—I stress that it is its own money—to build new classrooms for a school that is overcrowded, if that is what it has democratically decided to do? Why cannot we trust the men and women, from all parties, who give so much in public service, whose careers suffer and who do not enjoy the salary of a Member of Parliament? They often live on a pittance as their reward for their commitment and concern. Why cannot we let them get on with the decisions that are properly local decisions, and stop interfering? They are accountable to the people in the same way that we are accountable to the people. Why is not that enough?

I agree with what my right hon. Friend the Member for Chesterfield (Mr. Benn) has said—there are only two ways in which councils should be accountable, at the polling station and at the police station. There is no justification for any other controls. We need to free local government, to free the country and to free the people from central control. It is not just the Scots and the Welsh who want devolution—every council chamber in the country is shouting for that independence.

Part of my role in the House will be to do all that I can to protect local government, of whatever political persuasion, from the excesses of central Government, again of whatever political persuasion. If I can be successful in that task alone, the time that I spend in the House will not be in vain.

6.28 pm

Mr. Alan Haselhurst (Saffron Walden)

There are so many congratulations to be offered that it is difficult to know where to begin, but I shall do so by congratulating you, Mr. Deputy Speaker, on your appointment.

I also congratulate the hon. Member for Nottingham, East (Mr. Heppell). Among a number of hon. Members making their maiden speeches today, he showed tremendous fluency. We appreciated his speech, and in particular his generous tribute to his predecessor Michael Knowles. I say that with some feeling because Michael was a close friend of mine. From the hon. Gentleman's accent, I guess that he, too, came as a stranger to Nottingham. Michael Knowles served Nottingham, East very well during his time in the House, and we thank the hon. Gentleman for his acknowledgement of that. We trust that he will also have a successful time in this House, and we look forward to listening to him again.

I pay tribute to others who made their maiden speeches this afternoon, and particularly to my hon. Friend the Member for Bury St. Edmunds (Mr. Spring). It was nice to hear a maiden speech from a Member of Parliament from East Anglia, and especially my hon. Friend's excellent contribution. I welcome my hon. Friend the Member for Croydon, South (Mr. Ottaway). It is very good to see him back on these Benches.

I gained the impression from the speech of the hon. Member for Kingston upon Hull, East (Mr. Prescott) that he was not so much contributing to a debate as electioneering for the Labour party post that he seeks. That impression was heightened by the absence of any of his opponents to lend support to his speech. The greatest cheers came when the hon. Gentleman was recycling out-of-date socialist concepts. They did not receive many votes in the general election, and the hon. Gentleman ought to keep a sense of proportion.

My own approach is one of caution, because I do not believe that privatisation was one of the principal reasons for the re-election of a Conservative Government—though I acknowledge the point made by my hon. Friend the Member for Bury, South (Mr. Sumberg) that those who became shareholders from privatisations weighed that in mind before casting their votes.

Had I been ordering priorities in 1979, at the start of a Conservative Government, I doubt that I would have placed privatisation at the top of them; but I have warmed to privatisation as a consequence of my observations of the industries affected and of my conversations with those who work in them.

It is important to free public sector companies from Treasury control so that they are at liberty to obtain resources in other ways. Privatisation has also boosted management, provided incentives to employees, and demonstrated degrees of increased competition.

We are beginning to establish a regulatory system to protect public and consumer interest. We are still on a learning curve in our use of different methods, and in awarding different powers to various regulators, but we now have evidence that they are cracking the whip quite hard. I welcome therefore the references in the Gracious Speech to moves towards the privatisation of coal and the railways. Although I was born in a south Yorkshire mining village, I shall not say anything on the subject of coal—not least because many other hon. Members want to contribute to this debate. I will confine my remarks to the railways.

I suppose that we might all consider ourselves experts on the railway system, because we travel either occasionally or regularly on different parts of the network. We could probably all claim that we have, at various times, suffered at the hands of British Rail. Any rail company will inevitably have its bad days, but sometimes the public suspects that British Rail has more bad days than it should. We all take an active interest in improving the system for our sakes and those of our constituents, whose letters about the inadequacies of British Rail account for a fair proportion of our postbags. Politicians get the blame for whatever happens.

It is not good enough to do nothing about the present arrangements. It is right that we should ease the grip of Treasury control, which would give the railways a chance to obtain revenue from other sources. The Treasury has been too closely involved in the railways' detailed work.

I draw the attention of the House to type 321 rolling stock, which is among some of the newest on British Rail. My constituents were pleased when I was able to tell them that the Cambridge line was at last to be provided with new rolling stock for the first time in living memory. Unfortunately, my efforts ceased when the principle of new rolling stock was accepted, and I did not go on to take any detailed interest in its design.

When the new trains arrived, they were a serious let-down. They were clearly influenced by Treasury concepts, and designed to accommodate as many passengers as possible. I believe that "pack 'em in and pack 'em tight" is the principle upon which the Treasury works. It produced the most ghastly rolling stock, and it is a great shame that that was the determining factor. The sooner that it gets away from that approach to running a railway, the better.

When I am told by Ministers that I should not get carried away with the idea that officials become too involved in such detailed considerations, it has all the believability that flies are not attracted to rotten meat. I have no doubt that the sticky hands of officials are all too evident on the plans affecting almost every detail of improvements to our rail system—and that must stop.

In general, I do not believe that British Rail's management is as good as it should be, and it must be improved. It has been proved time and again in the public sector that, if managers' plans are countermanded by officials and politicians, they will despair and move into the private sector. Managers, if they are worthy of the title, want to be the real bosses.

British Rail also has a communications problem. The public are frustrated that its management has failed to get through to the operatives the importance of conveying passenger information and that it is better to explain why a train was late. All kinds of modern communication techniques are available, yet they are not regularly and reliably used. That also is a management fault. Employee morale could also be improved. If British Rail employees are given an opportunity to invest in the network, they will bring greater commitment to it.

What should be our objectives? We must want greater investment, improved efficiency, better reliability, and greater comfort. Should not comfort come into it when determining the type of trains that run on the system? Why should passengers have to rub knees with those sitting opposite them? They may or may not find that an enjoyable experience, but it ought to be possible to design carriages that do not make that necessary.

How can those objectives be achieved? Perhaps the simplest concept is a track authority separate from those responsible for running services on the track. That concept is easy to understand, but it leaves great questions to be answered.

Mr. Adley

Everyone knows the questions, but no one has the answers.

Mr. Haselhurst

My hon. Friend the Member for Christchurch (Mr. Adley) is more expert in these matters than I am. However, the superstructure of the track authority should not impose too great a burden of cost on those who operate the system—and it is easy to see that it might do so.

We must also ask how it would ever be possible to finance new track. Many hon. Members want rail track to be opened up: I am one, in that I want more track to be provided to enable a service to Stansted airport to run without conflicting with the needs of my constituents who are regular commuters on the line. I also want to know how we are to put more money into the system. It may be possible through the franchising of stations, or through the sale of of land, to enrich the sources of money for a track authority. We shall need to pursue such questions.

Mr. Adley

Would not the Government be wise to recognise that the railways are part of the nation's transport infrastructure and not just another industry? Having recognised that, should they not look less to the privatised industries that have emerged in the past few years than to the lessons that could be learnt from other countries—especially our European competitors—which have tried to find answers to the questions that my hon. Friend and the rest of us are posing and to which none of us has found the answers?

Mr. Haselhurst

Indeed, we shall have to ask a great many questions. Although I consider it right to move in this direction, I agree that we do not have all the answers yet and that we must find as much evidence as possible from as many different places as possible. I do not think, however, that we should begin by being defeatist.

Obviously, it is possible to improve access to the system. We already have such access through freight: Foster Yeoman, for example, is already running its own wagons on the British Rail system. It is more difficult, however, to see how open access can apply in the case of passenger traffic—not impossible, but more difficult. There is restricted scope for head-to-head competition; there are not many routes in the country where there are alternatives. The hon. Member for Glasgow, Garscadden (Mr. Dewar) laughs, but there is certainly more than one way to go to Scotland, and it is possible to envisage competition between the east-coast and west-coast routes. Similarly, there are two ways of going to Cambridge, and competition is possible there. Unfortunately, there are not two ways of getting to Birmingham now, as there used to be. The possibilities are very restricted, and a different sort of competition is possible only where different services on, say, InterCity routes could be run by different companies.

I am prepared to contemplate that, because I think that it might lead to a ratcheting-up of standards as new ideas are introduced to the running of our railway system. Great care will have to be exercised, however, with the interchangeability of tickets and the integration of the timetable. Perhaps the most sensible method is to franchise routes as a whole, or to franchise present sectors of British Rail as a whole. It might be possible, for instance, to franchise the west Anglian line, the Great Northern line and the Great Eastern line so that they are run according to certain standards. That might improve the reliability and quality of those lines. I think that the idea is worth pursuing, and I shall watch with great interest as the Government's plans unfold.

Let me return to my starting point. There must be a better way of running our railways. The Government are right to be uncomfortable with the status quo; certainly, many of our constituents are uncomfortable with it. I therefore view the Gracious Speech and its new approach with an open and welcoming mind, and I believe that a good deal of gratitude can be earned if we manage to get things right during the current Parliament.

6.43 pm

Ms. Helen Jackson (Sheffield, Hillsborough)

I congratulate you on your new position, Mr. Deputy Speaker, and I thank you for calling me.

I speak with some humility in this, my first maiden speech—indeed, my only maiden speech. That is not just because of the traditions of the House; it is also because, as the new Member of Parliament for Sheffield, Hillsborough, I am very much aware that my predecessor spent many years in the House, made a magnificent contribution to its debates and will be a hard act to follow.

I first knew Martin Flannery and his wife Blanche in 1973, when I went to live in the part of Sheffield in which I live now—my present constituency, which, as the constituency of Penistone, was represented then by Jack Mendelson. After his death, it was represented by Allen McKay.

One of the things on which Jack Mendelson and his colleague Martin Flannery worked tirelessly in 1973 was the exposure of the iniquitous military coup in Chile—financed by the CIA—which caused the death of Salvador Allende, then leader of the Government, and led to the death, imprisonment and torture of many thousands of Chileans. I worked with my predecessors then to open the way for students, trade unionists and many other brave men and women from Chile to find a refuge in this country. I know that Martin Flannery, like me, is very concerned about the reference in the Queen's Speech to the reintroduction of the Asylum Bill; that will make it much more difficult for people who have suffered torture to find refuge here.

I suppose, however, that Martin Flannery's main concern was education. He brought to the enormous amount of political work that he did in the House a deep practical knowledge, arising from his own experience as a head teacher and his understanding of the profession of teaching children. When I was canvassing during the recent general election, I found that virtually one person in every street in one area of Sheffield had either been taught by Martin Flannery or been to school with one of his relatives. His deep practical knowledge of education was invaluable, and I am sure that the House will wish to join me in congratulating him on the honour conferred on him by the National Union of Teachers, which made him an honorary member at Easter.

Martin Flannery was deeply troubled by the damage done by the Conservative party to the morale of schools and colleges over the past 13 years. I read with great concern the weasel words "extend choice and diversity" in the Queen's Speech. What does that mean in education? How many parents whose children passed the 11-plus—in those bad old days of the 11—plus and meritocracy—chose, because they had the choice, to send their children to secondary modern schools? How many parents of children who did not pass the 11-plus, and who therefore did not have the choice—unless they had the money to opt out of the public system and send their children to private schools —were able to do the same?

Extending choice for the rich and fortunate in public services always reduces the standards for the many. We shall need to return to those arguments later in our debate on the Queen's Speech.

Let me now turn to the subject of today's debate. If privatisation is an ugly word in terms of education, deregulation is an even uglier word in terms of south Yorkshire's transport system. One of the best things about the area of Sheffield in which I live, when our children were growing up there, was the cheapness of public transport. In their half-term holidays, if they wanted to go for a swim in Rotherham, visit the market in Chapeltown or go to the shops at Hillsborough corner, it cost them 2p. To me, that represents real choice and diversity.

The results of deregulation are now clear to everyone living in south Yorkshire—and, indeed, are accepted universally, with one or two exceptions; there are still a few backwoods Tories around. The fares went up; the number of passengers went down; the number of private car users went up; the buses became older and dirtier; there was no overall planning. It is impossible to obtain a timetable for south Yorkshire buses any more. Ridiculous congestion is caused by competition for routes in the centre of Sheffield. Thousands of jobs have been lost and the very good training centre run by the bus company has been closed. There is no one to complain to when things go wrong; one is just shunted from one place to another.

If that experience of how to dismantle a good public transport system is transferred to the railways, there will be disaster. Under this Government, trains and rolling stock are old and dirty. Are they going to get older? Are we going to go back to the days of steam? Since 1979, under this Government, fares have risen 30 per cent. more than inflation. Fares in London are more expensive than in any other capital city. Financial planning, co-ordination and looking to the future have already suffered while British Rail has been preparing for privatisation by breaking up the system into different elements. Manufacturing jobs have suffered as a result of under-investment. By 1991 we had spent less capital on the rail infrastracture than any other EC country, apart from Greece and Ireland.

Perhaps we should ask whether that really matters. Of course it matters. It matters for a range of reasons, but fundamentally because of the number of private cars and lorries on the roads. We are told in "Road Facts 1992" that by the year 2000 car traffic will increase by 36 per cent. and lorry traffic by 27 per cent. Something must be done about that. One fifth of all carbon dioxide pollution in Britain is caused by road transport. The only way to address that problem is sharply to increase investment in public transport, both on the roads and on the railways. If we are to create a healthy future both for ourselves and for our children we must slow down the use of private transport. I support wholeheartedly the measures that were so forcefully put before the House by my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott).

I shall be raising other issues on behalf of my constituents. In my constituency there are 200 ex-employees of Newton Chambers Engineering. When that firm went into liquidation the financiers got hold of it. It was sold, and then sold again. Eventually the pension money of ex-employees ended up in the hands of those who administered the Maxwell pension funds. They now have to wait month by month to see whether their cheque comes through.

I shall also be raising health issues, in particular health and safety standards in the steel industry on behalf of the many people who work at Stocksbridge Engineering Steels. I shall press for the acceptance of lung disease as a recognised normal industrial hazard within the steel industry. I shall raise issues concerning community care. An increasing number of elderly people in my constituency do not enjoy the necessary day and community care services that would enable them to end their lives with dignity, instead of being subjected to exploitation by some of the most obscene forms of privatisation—the mushrooming number of private homes for the elderly.

I regret the fact that the Queen's Speech offers little hope to my constituents that their aspirations to jobs, prosperity and a better quality of life will be realised in the near future.

6.54 pm

Mrs. Angela Knight (Erewash)

Thank you, Mr. Deputy Speaker, for inviting me to make my maiden speech.

I congratulate the new hon. Member for Sheffield, Hillsborough (Ms. Jackson). We have known each other for a number of years. We served together on Sheffield city council and we live only a few miles apart. I was particularly interested, therefore, to hear her most informative speech and the points that she made about Sheffield. I must confess, however, that I was not aware that her constituents are interested in Chile.

It is a privilege to be a Member of the House and, in the established tradition, I wish to pay tribute to my predecessor, Peter Rost. He represented Erewash and the former Derbyshire, South-East constituency for 20 years. He was highly respected throughout the area for all the work that he undertook on behalf of his constituents. He was a member of the Select Committee on Science and Technology in this place and a founder member of the Select Committee on Energy. It was there that his particular interest lay. All those who knew him will, I am sure, agree that he was one of the most knowledgeable Members of Parliament on energy matters. Now that he has retired, that interest and expertise will not be lost.

I now have the honour of representing the Erewash constituency. It is a diverse area in Derbyshire. It contains beautiful countryside and villages and also the principal towns of Ilkeston and Long Eaton. It has lower than average unemployment and a high proportion of the work force is employed in manufacturing industry. Textiles and light engineering are two of the principal industries in that area. Textiles, including lace, are an important part of the local economy. There is a widely held but incorrect belief that lace is, somehow, a cottage industry that employs a few people working by hand in back rooms. The truth is very different. My right hon. Friend the Chancellor of the Exchequer visited a modern, computerised lace mill in my constituency during the general election. I am grateful to him for his visit to Birkins, as are those who work there. One machine in that factory produces 70 miles of lace a week. There are 80 machines in that lace mill alone. It is a vibrant and automated industry that has been able to invest substantially in new equipment and plant throughout the 1980s. It now looks forward with confidence to the future.

Lace is both a tradition and a necessity. Many women wear a hit of lace close to their heart, most of the time. That fashion is unlikely to change. It is also a good export for this country. However, despite good investment and productivity, the trade restrictions of other countries can present trading difficulties for companies in my constituency. I look forward to the speedy conclusion of the talks on the general agreement on tariffs and trade, as set out in the Gracious Speech.

Light engineering is one of the other principal industries in the area. I worked for 15 years in the engineering industry. I saw the decline in investment during the 1970s and took part in the revival in investment in manufacturing throughout the 1980s. However, I am still saddened to hear some politicians talking down British industry. The reality of the last 13 years is that investment has increased, that exports have grown and that productivity has immensely improved. Just before the election, a survey was undertaken of businesses in the east midlands. That survey, published last week, shows that over three quarters of Derbyshire businesses could see that recovery was coming strongly. With the outcome of the general election now known, confidence has improved further. The privatisation programme has been fundamental to the transformation of the performance of British industry.

Nationalised industry was a byword for inefficiency and low productivity. Nationalised companies lost taxpayers money and competed with other demands on the public purse for capital investment. Management did not have the freedom to manage. It ultimately had to meet political requirements. It could not therefore make the business decisions that were necessary, and there was no incentive for enterprise. Those of us who worked in industry knew it because we saw it. Following privatisation, those former loss-leaders of industry have become profitable companies. They pay taxes into the Exchequer rather than take money from it.

In the few days that I have been a Member, I have heard Opposition Members say that all that should be done is to keep as much industry as possible nationalised and change the rules so that they can have access to additional private finance by one route or another. Indeed, I heard that this afternoon. Their proposals for nationalised industry borrowing would still affect public expenditure plans and therefore would be limited by political constraints rather than by business requirements. The freedom to manage would be lost, yet that freedom has brought success to privatised companies.

The massive investment that is now being made in the water industry to improve purity of water is resulting in extensive new pipework being laid by the water companies. Many of those pipes are made in my constituency. Stanton Ironworks is in Erewash. It is now a large, viable privatised ironworks that had formally been languishing in the public sector. It is a principal supplier to the water industry, which now has the ability for massive investment. None of this was possible when both were nationalised concerns.

I look forward to the other improvements that will flow from the programme for industry outlined in the Gracious Speech. Through Erewash runs the midland main line railway. Connected to that line, and lying within my constituency and that of the neighbouring constituency of my hon. Friend the Member for Broxtowe (Mr. Lester), is a large and under-used railway siding, which would be an excellent rail head for the channel tunnel. It would generate more employment for the area and increase local prosperity. I look forward to it being developed as a road-rail freight haulage centre. It will bring opportunity for my constituents and for the east midlands, but that opportunity will come only with the proposals for the liberalisation of British Rail and freight that have been outlined.

There is a wider aspect of the public ownership debate. From the five years that I have spent in local government, I can tell the House that I am a passionate believer in local government. But just as I am a passionate supporter of it, I equally passionately dislike seeing local government run badly. The introduction of competitive tendering has been essential in ensuring that local government seeks ways of administering the services of the area more effectively, at a lower cost and at a benefit to those who live there. One of the pluses of competitive tendering has been the highlighting of inefficiency and waste, so long hidden in a fog of bureaucracy.

As a councillor in opposition on Sheffield city council, I saw the expression "local democracy" used as an excuse to grasp as much control as possible for the town hall and then to do what a group of councillors wanted rather than what the people needed. Too many times, I have witnessed a council flouting the desires of parents and schoolchildren even when there was no financial reason for doing so. That is not true local democracy, nor is it public accountability as it should be.

I know that there have been debates in past months in the House on the affairs of Derbyshire county council, and I suspect that there will be more. Erewash education is administered by Derbyshire county council. It is making budgetary decisions that are against the wishes of parents, governors and schools throughout the county. My constituents object, as they know that their children will be adversely affected, and unnecessarily so. Indeed, I believe that the Labour party was lucky that there were no county council elections last week. If there had been, Derbyshire could easily have done a Basildon.

I do not make the erroneous assumption that, because some local authorities ignore the wishes of the electorate, all of them do. But, undoubtedly, the Government's Education Acts have empowered school governing bodies to make decisions, after listening to parents' wishes, in a way that local authorities would find difficult. That has truly empowered the people.

The proposals in the Gracious Speech for further progress to allow parents choice, to give children greater opportunities and to continue to raise standards in education and allow more schools powers of control over their own affairs are particularly important to my constituents. Local councillors do not have to run everything. Councillors are elected not to run a rubbish collection business but to ensure that that service is provided. Equally, Members of Parliament are elected not to run a steel works, a telephone company or a water board but to ensure that industry has the right climate in which to operate and that those processes and procedures are regulated and that standards are set.

True public ownership is about individuals owning shares in companies, including those for which they work. They then have a real stake in their industrial future. In local government, public ownership is about parents being involved in the running of their schools, and schools having independence of action within the state system.

Under the citizens charter, every citizen is entitled to expect high standards of openness, information, choice and redress with the public services. I look forward to playing my part in the legislative programme that has been outlined in the Gracious Speech, as it will bring real benefits to my constituents.

Several Hon. Members

rose—

Mr. Deputy Speaker (Mr. Michael Morris)

Order. The debate is now subject to the 10-minute rule. It may assist hon. Members if I point out that the colon between the hour and the minutes on the clocks will flash after nine and a half minutes have elapsed.

7.7 pm

Mr. Cynog Dafis (Ceredigion and Pembroke, North)

I am grateful to you, Mr. Deputy Speaker, for allowing me the opportunity of making my maiden speech.

There is real concern and anxiety in Ceredigion and Pembroke, North about the Government's intention to privatise parts of the rail services. There is some sense of relief that BR will retain control of the track—for the time being anyway—and that the intention to sell off InterCity or to create private regional companies has been shelved.

My constituency is served by two railway lines of much importance—to Fishguard, with its harbour and ferry service, and to Aberystwyth, a prestigious centre for higher education and research, which needs an efficient railway service. My constituents and I will be looking for guarantees that those services will be maintained—enhanced, rather. Indeed, I think that there is an opportunity for new track and new routes in whatever changes occur.

I am glad to read that the Government are committed to increasing the role of the railways in meeting the country's transport needs, but my constituents are looking for action, not words. There can be no avoiding the need for substantial public funds to provide a satisfactory railway infrastructure. It is difficult to understand how privatisation would facilitate the development of an integrated system of rail, road and telecommunications which is one of the crying needs of Wales and, indeed, of Britain as a whole.

Increased emphasis on rail transport is important not only for the economic prosperity of west Wales and, of course, of my constituency but for the benefit of the environment. It is a well-established fact that rail transport is infinitely less damaging to the environment than road transport. I am told that a train carrying only 100 passengers can achieve 250 passenger-miles per gallon equivalent compared with 30 passenger-miles per gallon equivalent achieved by a car carrying one person. A similar picture emerges if one considers freight transport. Clearly, that has significant implications in terms of the levels of carbon dioxide emitted into the atmosphere by the two forms of transport.

The very mention of the words "environment" or "CO₂ emissions" cannot, I hope, fail to remind hon. Members of what has been called the most important meeting in the history of the world—the United Nations Conference on Environment and Development to be held in Rio in a few weeks. The prospects of success at that conference should above all else be exercising all our minds at this time. Its title reminds us that development and the environment must henceforth be inseparable concepts. We know of the crying need for economic development among the poor peoples of the world, but all development must henceforth be sustainable in terms of the natural systems that make life possible or, at the very least, tolerable on planet earth. At present, the signs are that the measures likely to be taken by that conference in Rio will fall far short of what is necessary to save our planet. I do not think that I am using overly dramatic language when I use words such as "to save our planet".

On climate change, the likely failure is in large part the result of the thoroughly irresponsible behaviour of the United States of America which, with 5 per cent. of the world's population, is responsible for 25 per cent. of the world's CO₂ emissions. The United States were, at least until recently, predicting an increase of 40 per cent. in the use of coal in order to meet a 46 per cent. increase in electricity demand by the year 2010. It is the United States' objections which have blocked an international agreement to stabilise CO₂ emissions at 1990 levels by the year 2000.

The terrible thing is, of course, that even an agreement to stabilise CO₂ emissions at 1990 levels by the year 2000 would be woefully inadequate. Present levels are, in all probability, unsustainable and may very well be causing deadly damage now. Reference has already been made to conditions in Africa and there is a possibility of a link between the terrible drought in southern Africa and the phenomenon of global warming. Present levels of CO₂ emissions may be causing deadly damage now and could possibly lead to catastrophic climate change.

The United Nations Intergovernmental Panel on Climate Change has called for a reduction of 60 per cent. in global CO₂ emissions. One can only hope that the Prime Minister and the Secretary of State for the Environment are aware of the deadly seriousness of the matters at issue and that, if necessary, they will go to Rio with a commitment to reduce unilaterally and significantly CO2 emissions in Britain. Of course, to meet such a commitment would require a strategy involving several elements. One of the those elements would be an integrated transport system and a shift of emphasis from road to rail transport.

I mention only one other element of such a strategy. As 36 per cent. of Britain's carbon dioxide emissions come from the burning of fossil fuels for the generation of electricity, there is enormous scope and a crying need for an ambitious programme of conversion to non-polluting renewable sources such as wind, tide, wave and hydro. It so happens that my constituency and western Wales in general have enormous potential for such sources. I hope that hon. Members will know that with an economy facing a crisis resulting from serious difficulties in agriculture and the threatened run-down in defence establishments, west Wales requires a strategy for economic renewal. The development of such a strategy within the existing political framework lies, of course, with the Secretary of State for Wales, his fellow Ministers at the Welsh Office and the Welsh Office itself. That is where the responsibility lies. I believe that such a strategy must include substantial public investment not only in the infrastructural development, including the railway, but, to a significant extent, in roads.

There must be changes in energy policy on a British, European and global level. I am very disappointed that today's debate on energy and transport has not mentioned the global context in which they must operate. In view of the fact that those changes must come, renewable energy generation could play a significant role in a development strategy for west Wales. However, my anxiety is that such renewable resources will be exploited—as has so often been the case in Wales where water and opencast coal mining are just two cases in point—for the financial benefit of powerful external forces but with minimal benefit for the communities in which the resources are found. I fear that that will happen again with renewables.

A development strategy for west Wales must ensure that renewable energy generation provides the maximum benefit for the area, which implies the retention of a substantial proportion of the profits so that they can circulate within the local economy. That would be best achieved at least partly by developing a degree of co-operative ownership, which is not quite the same as state ownership.

It is my conviction that the establishment of a democratic Parliament for Wales is the only satisfactory way to provide the right economic and social development for our country, and that is a point that I must emphasise. It is also a point with which my predecessor, Mr. Geraint Howells, who was regarded with great affection and respect in the House and in his constituency, would agree entirely. In the next few years, the Secretary of State for Wales and the British Government in general have the opportunity to prove me wrong.

7.27 pm

Mr. Robert Adley (Christchurch)

First, let me congratulate you, Mr. Deputy Speaker, and say what a pleasure it is not only for Conservative Members but for hon. Members of all parties to see you looking so cherubic in your post. We congratulate you and wish you a long and happy tenure of the Chair. It is good to see you there.

May I also congratulate the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis). His party did incredibly well to win four seats in Wales although I do not know what the message is. I recall that following the Scotland and Wales Bill the referendum in Wales produced a stunningly large majority against any form of devolution, yet Plaid Cymru now has more seats than the Scottish National party. One day, no doubt, the hon. Member for Ceredigion and Pembroke, North will explain to the House where he thinks Wales is going.

May I also congratulate my hon. Friend the Member for Erewash (Mrs. Knight) on a spiffing speech. It was fluent and constructive and showed that she is politically and commercially experienced. It was a pleasure to hear and a privilege to be present. We do not have much time so I shall deal immediately with the Loyal Address.

It is the first time in more than 20 years that I have spoken on the Loyal Address and I am minded to do so because of the two sentences on page 3 of the Queen's Speech which state: My Government are committed to increasing the role of the railways in meeting the country's transport needs. Legislation will be introduced to enable the private sector to operate rail services. The supposition is that sentence two will enact sentence one. That is not yet proven, but I certainly hope that that will be the case. Otherwise, we will all be in a great deal of trouble.

I do not doubt the Government's motives. I had considerable doubt about the transport policy of the Conservative Government under my former right hon. Friend Margaret Thatcher. She was perceived, rightly, in many quarters as being hostile to the railways. That is not the case with my right hon. Friend the Prime Minister. He was generous with his time with me before the general election. Therefore, I give him and his Government the benefit of the doubt, certainly about the motives expressed in the Queen's Speech. Few hon. Members would pretend that British Rail is perfect. In passing, I declare a commercial interest only in that it lets me know that some parts of the British Rail empire are urgently in need of surgery if they are to make the best use of the national assets at their disposal.

The railway is an essential component of the modern industrial state. One cannot judge a railway by normal commercial criteria. It is not a monopoly; it must compete with road transport where all the track costs are funded by the taxpayer. Moreover, the private motorist does not cost-in his own time. As I suggested in an intervention in the speech of my hon. Friend the Member for Saffron Walden (Mr. Haselhurst), the Government should assess their plans for the future of our railways not by comparing the railways with other industries that have been privatised, but by the experience of our competitor countries, Germany, Japan, France and Switzerland, many of which have considered railway privatisation and found it wanting.

I turn straight to methods and that second sentence in the Queen's Speech. We must define the need. We must weld private sector discipline and management expertise on to the public service obligation of the railways. It would be ridiculous to create conditions under which British Rail would be disadvantaged in its access to funds vis-a-vis the private sector. This afternoon we have heard few comments about safety being paramount. Whatever happens there must be no question of any reduction in the high level of safety which has always been imposed by this House on the operators of railways, whether in the public or private sector.

There must be a continuing role for Her Majesty's Government in both rail investment and rail subsidies. Some of the methods not even considered in this country are applied by many of our international competitors. They have a determined policy to promote the role of rail travel. What thought is being given to utilising the tax system to encourage the use of rail freight? What time is being spent on examining incentives to use the railway, or disincentives to use the road? I hear little of that, yet in Germany, for example, that is a standard way of generating the utilisation of the state railway system.

The hon. Member for Kingston upon Hull, East (Mr. Prescott) discussed the need to allow British Rail to borrow funds from the Treasury. The SNCF has been doing that from the French Treasury for years. The excuses or reasons not so to do from Treasury Ministers, however one looks at them, are almost beyond my comprehension. We need to invest more in our transport infrastructure. If the French railways can borrow money without a French Government guarantee, we should be able to do the same here.

People ask whether we need any legislation on the railways. We do. Shortly SNCF will want to run trains on British Rail tracks. If the Government were a little more frank, they would tell us that to enable SNCF to run trains on British Rail track through the channel tunnel there will need to be an amendment to primary legislation. If ever the private sector manufacturers get round to producing the necessary rolling stock to enable channel tunnel trains to be run, we shall need to legislate.

This is not the time to examine the paving Bill in detail, but the Committee will need to consider clause 1(5) which states: The powers conferred by this section in relation to any proposal shall be exercisable whether or not Parliament has given any approval". I believe that my right hon. Friend the Secretary of State for Scotland is to reply to this debate. Let me use a Scottish example to make a point about investment criteria. After 20 years in this place I managed to secure a debate on 23 March 1990 on railway investment criteria. It is little less than scandalous how investment in roads is given such priority by the Department of Transport in relation to investment criteria. Why did we not build a rail bridge across the Dornoch Firth when the road bridge was built? That is a classic illustration of failure to create a level playing field for British Rail.

Earlier in the debate my hon. Friend the Member for Basildon (Mr. Amess) spoke about the Southend line and my hon. Friend the Member for Southend, East (Sir T. Taylor) mentioned it today. That line has been starved of investment and has a rotten service. Compare the service on the Southend line with the service on the Chiltern line, which was recently extensively modernised with new track, new signals and new rolling stock. The customers are satisfied, revenue is up and passenger numbers are rising. Investment is essential.

My main question is: do the Government think that any forthcoming Bill will generate private-sector investment into our railways and, certainly, our commuter railways? Nobody in his right mind who runs a business will invest heavily in capital equipment, use it for four hours a day, five days a week and leave it idle for the rest of the week. That is no way to run a business, but that must be done if we are to enable commuters to get into and out of our major cities.

I hope that my hon. Friend the Member for Basildon will not hold his breath until Richard Branson comes along and provides a new railway service on the London-Tilbury-Southend line. That gentleman is very good at public relations, but his ambitions for the east-coast main line seem to be to piggyback on a major slice of public investment. In the past few years £500 million has gone into that line. To cherry pick a few of the juicier bits and pieces of the railway system does not help us to judge whether private operators will invest capital in our railways.

We have a complex rail system. [Interruption.] The lights are flashing and I must conclude. The BR timetable has 1,392 pages and costs £5.50. That is good value for money. I urge my hon. Friend the Under-Secretary of State for Scotland to suggest to his colleagues that before they risk tearing it up and destroying one of the best railway systems in the world, whatever its faults, they should read the timetable and see what is involved.

7.27 pm

Mr. Eric Clarke (Midlothian)

I congratulate you, Mr. Deputy Speaker, on your elevated position, and I thank you for calling me to speak today.

As this is my maiden speech, I should like to pay tribute to my predecessors who formerly represented Midlothian in the House. Alex Eadie served here for 26 years. He was a Minister in the Labour Government, a Front-Bench spokesman and an able Back Bencher. I am sure that he earned the respect of Conservative colleagues as well as Labour colleagues and I hope that the House will join me in wishing him all the best in much deserved retirement.

In the past, three miners represented Midlothian: Jimmy Hill of Musselburgh prior to Alex Eadie, and David Pryde of Bonnyrigg prior to Jimmy Hill. They were all men of the people and active trade unionists in the National Union of Mineworkers.

I have the same background. I was a miner who worked underground for 26 years prior to the 12 years that I served as a trade union official. In addition, I have 16 years' experience in local government as a county councillor and regional councillor for Lothian.

I am proud to be a socialist and a trade unionist, especially as a member of the National Union of Mineworkers, an organisation brought about to protect miners and their families from the coal owners of the past, the bad legislation that came from this House and I might say the present bad legislation that may happen but I hope will not.

Victimisation of miners was rife in the past and we still have victimised miners in Midlothian and elsewhere who cannot get work in the industry. It was because of the trade union that we protected many of these innocent people and raised the much-needed standards of safety required in mining underground. It is a sad day when the Government propose to privatise the British coal industry. Mrs. Thatcher wanted us to return to Victorian values; the Prime Minister wants us to return to the dark ages of the coal owners.

At present, miners working in private mines are worse off than those working in British Coal mines. The accident rate per thousand shifts is three and a half times worse in private mines than in British Coal mines. The statistics are exactly the same as the accident rates in the United States of America. Private enterprise is not beneficial to miners as far as the accident rate is concerned. Miners in private mines have no "self rescuers", a small apparatus carried on the person of every miner underground which is used in a fire to protect them against smoke inhalation and could have saved many lives. They were introduced as a result of the disaster at Michael colliery in Fife, but private mines do not supply them to their work force. In most cases, private mines have no pithead baths and no work wear system as of right—the free issue of laundered overalls and underwear to men who work underground. The redundancy agreement for those in private mines is the basic minimum industrial agreement on the statute book and it is a pittance compared with that for people covered by the British Coal scheme.

Privatisation does not just affect miners and their families; it affects this country. The short-term profit motives of extracting coal, as against the long-term protection of all potentially workable coal measures within a colliery, is the priority of the private coal owners. We have had hundreds of examples throughout every coal field of short-sighted exploitation of such measures, spoiling and sterilising millions of tons of coal for ever.

I am pleased to see that the two Parliamentary Under-Secretaries of State for Scotland are present. I am worried about the situation in Midlothian and what will happen to Monktonhall colliery on privatisation. It is a colliery on "care and maintenance", so will it be included in the overall Scottish sell-off? Will Scotland's coal assets—pencast and deep-mined units—be sold as a package? If the Government really care about the future of the Scottish coal fields, I propose that they sell off the coal industry as a package in order to create wealth for the owners to develop the deep-mined coal measures and resuscitate Monktonhall and Frances collieries in Fife and provide much-needed employment in the areas. As someone who really cares for the coal industry and its people, 1 hope that common sense will prevail if privatisation takes place.

I have read with great interest the maiden speeches of my predecessors, which contained pleas to the Governments of the day for the protection of indigenous industries—for example, the Scottish shale oil industry, the paper-making industry and obviously the coal mining industry. There is no longer a shale oil industry in the Lothians because of the withdrawal of subsidies to the industry, causing many people to become unemployed in the past. There is only one paper-making mill left in Midlothian when there were many in the past and there is only one colliery, Monktonhall, which is on a "care and maintenance" basis. The deindustrialisation of Midlothian can be repeated throughout the whole of the United Kingdom and Government after Government, not the representatives of Midlothian, are to blame We, as a country, are left with the uncertainty of importing goods and materials which will result in mass unemployment throughout the country.

We must protect our indigenous industries, we must expand job opportunities based on high-tech industries and new ideas. We are internationally famous for discovering new ideas and processes, but we are woefully bad at manufacturing them. We need training for high skills and diversification from our defence industries and we need to retain and retrain a highly skilled work force, which is being made unemployed. The Government must intervene. We need help to encourage firms to diversify and we need money to be put into training establishments to bring about such a highly skilled work force.

I will continue to repeat, whenever the opportunity arises, that the people of Midlothian and elsewhere must be given the right to work and should have a standard of living equal to that of those living in any other area of the country. It is not for them the double standards of having a few who are rich and the vast majority who are poor.

7.35 pm

Mr. Mark Wolfson (Sevenoaks)

It is a pleasure to follow the hon. Member for Midlothian (Mr. Clarke), who spoke from his own hard experience and from the heart. I congratulate him on his speech and we all look forward to hearing more from him.

It is my particular pleasure to congratulate you, Mr. Deputy Speaker, on your assumption to the famous office of Chairman of Ways and Means. We shared one part of the route to Westminster when we both stood, I after you, as, I regret to say, the unsuccessful candidates for the old Islington, North constituency—not a constituency known today for returning Conservative Members of Parliament. I congratulate you on your new office and I wish you well in it.

There have always been two key reasons for privatisation. The most important is that it removes the burden of financing investment programmes from the public sector to the private financial markets. The second reason is also of real significance. The management of privatised industries can no longer look to Government to bail them out of loss-making activities. That same management is no longer directly constrained or supported by Members when it makes changes of national significance such as the decision to close a plant or to run down production in response to the market force of customer demand.

Nationalised industries become very inflexible in responding to market demands—they were often discouraged from such flexibility by demands made in the House for the protection of constituents' jobs—and that did not help them to remain competitive in the world markets. I am thinking in particular of the steel industry of the past. Such inflexibility caused that industry great problems when it was forced to change its structure as a result of changing markets in world demand. Those problems have continued until today.

I remember when Sir Anthony Meyer, a former Member, spoke of his experience in his constituency when the Shotton steelworks were closed. He regretted the fact that he had opposed the proposal, made in an earlier Parliament, to run down those works because such a rundown would have been much easier had it occurred outside a recession rather than in the recession of the early 1980s. So, when we have deployed arguments here in what we have considered to be the best interests of our constituents, they may not always have been in the long-term interests of the industries. I have never seen a good reason why industries that can run themselves properly within the private sector should unnecessarily be owned by the state. They nearly always end up being a financial burden to the state as well.

Two thirds of the state-owned sector of industry has been privatised in the past 12 years and losses in it have been turned into profits. Nationalised industries were receiving subsidies of £2.5 billion in 1978–79, equivalent to more than one third of that year's health service budget. In comparison with the need to fund the health and education services, spending Exchequer money on industries that could support themselves is not a good use of public money.

Now that they are back in the private sector, those industries are making profits, and they contributed some £2 billion to the Exchequer in corporation tax last year. That revenue will continue, quite apart from the massive £42 billion raised from the capital receipts of privatisation. Those proceeds have enabled the Government not only to achieve record spending levels on health, education and —despite many of the arguments deployed today—on transport, but to repay substantial amounts of the accumulated national debt. We publicise that fact too little. It has significant bearing on how other countries view the health of our economy against the present higher public sector borrowing requirement planned for the medium term. A healthy pound is evidence of that positive regard in which the overall budgetary structure of Britain is presently regarded overseas.

Through privatisation, share ownership has spread dramatically throughout the population. Thirteen years ago, only one in 20 of the adult population owned shares, whereas today it is almost one in four. Most significantly, that increased ownership is far more widely spread. Two thirds of share owners are now to be found outside the ranks of professionals and managers. I represent a constituency in the south-east of England and must point out that 60 per cent. of those shareholders live outside the south-east. The Labour party would do well to ponder that fact as it considers why its policies on renationalisation and its continuing commitment to clause IV may have affected the general election result.

Those are good reasons for privatisation but just as vital to this debate is the fact that the nationalised industries did not give a good standard of service and caused widespread dissatisfaction to customers. We can all remember the telephone installation that took weeks, the public phoneboxes that were filthy and seldom worked and the gas and electricity engineers who missed appointments and often had to make several calls to households before the job was done.

The contrast now is obvious and voters know it, even if the Opposition do not. Telephones are rapidly installed and consumers have a lot of choice in the type of installation that they prefer. It is now difficult to find a callbox that does not work and they are clean. Service calls by gas and electricity engineers are reliably organised on a morning or afternoon basis. Acting on its own initiative, East Midlands Electricity has introduced appointment times, rather than just stating that workers will come in the morning or the afternoon, and will pay compensation if appointments are not kept. That places the consumer in a dominant role, receiving a better service from the privatised industry.

The role of the regulator in privatised industries that are still monopolies is still absolutely key. I welcome the example of the gas industry regulator demonstrating that it will use its teeth, as we heard last week. The importance of the regulators cannot be underestimated in the fight against inflation, particularly in those industries where improved technology is making lower unit costs possible each year. I look to the regulators to take that into account when allowing the increases in charges by monopoly privatised industries. We expect them to deliver a better service to the customer at a lower cost.

The Government's approach towards the privatisaton of the railways is sensible and right. We are not going the whole hog immediately but approaching it steadily and cautiously. But the introduction of private capital into the operation of the railways will give passengers a better service and stimulate management, as it has in every other privatised industry, to put the customer first and to do a more effective job.

7.46 pm

Rev. Martin Smyth (Belfast, South)

I join others in welcoming you, Mr. Deputy Speaker, to your post this evening. With your interest in medical affairs, I am sure that you will be interested in the fact that, throughout this debate, no place has been given to the medical and social services side.

In the context of privatisation, I acknowledge that there is no intention to privatise the health service but, with the movement that is going on, there is great concern about the setting up of, for example, the Social Security Agency. I am not sure whether it is happening elsewhere, but there seems to be a cosy relationship between the agency's main office in Belfast and British Telecom. When people phone up, they are told to hold on. They hold on and on, and are then told that they will be put through to another department. They are then told that their call will be returned, but it is not. People on social security benefit do not like wasting money. It may be a cosy relationship because of the restrictions on chatlines and to help British Telecom make more profits. I do not know, but I should like to think that the Social Security Agency would be more outgoing in looking after people's needs with greater efficiency, as it still comes under some scrutiny from the House.

I pay tribute to the maiden speeches that I have heard, particularly those of the hon. Members for Sheffield, Hillsborough (Ms. Jackson) and for Erewash (Mrs. Knight). The hon. Member for Erewash commented on competitive tendering. I should like to think that, although we in Northern Ireland may have different problems from others, there will be greater control over what is happening. I was interested to discover not so long ago a company that had been on the list for selective tendering had been removed. I had written earlier to the Department to draw attention to the fact that it was not doing its work properly and was employing people on the double. I had received a letter informing me that that was wrong, that the company was reputable and that it would take anybody who made such allegations to court. I promptly replied that I looked forward to that day. The company was removed from the list because 80 per cent. of the work force on one contract were already being employed by the Department of Social Services—on benefits. So that is a case of competitive tendering in which the very Department is unware of who is receiving the benefits, and a firm's work force are then in a position to undercut the local council or other firms in tendering for services.

If we are talking about privatisation, we must also consider the way that the privatisation is undertaken. I have no axe to grind: if privatisation would be good for the community, by all means privatise. But I pay tribute to the successful outcome of Harland and Wolff and Bombardier Short in maintaining two industries working in a part of the United Kingdom where there are grave reductions in industrial manpower.

I also pay tribute to hon. Members who have served in Northern Ireland. I have not always agreed with them—a privilege enjoyed by hon. Members—but they have worked for Northern Ireland. Although there are those who think that Northern Ireland is a dead water. I suggest that it is a promotional spot for the governor of Hong Kong, and the Foreign Secretary has discovered that he did not do too badly having been at the Northern Ireland Office. In the context of industrial development in Northern Ireland, I pay tribute to the present Minister for Trade, who worked tremendously hard to bring investment into the Province.

To return to social services in the context of privatisation, I never thought that the problem that some of us envisaged about the arm's length inspection units dealing with the statutory, voluntary and private sectors would be resolved as now seems to be the case: by the abolition of the statutory sector and its replacement by the private sector. I regret that the Department seemed to be putting pressure on social service units, both within the direct management of the Department in Northern Ireland and within local government responsibility, to close homes, which meant the opening of more private homes. The time will come when, no matter who are in Government, they will have to introduce amending legislation because of the pressures on the public purse created by the escalating costs in the private sector.

The Chancellor of the Duchy of Lancaster has today been called the Minister for little people. We have heard about the charter of rights, and parental choice in education. My constituents know that that is a myth. The Department closes schools and reduces the size of rolls so that infants intending to go to primary school cannot be taken into the go to primary school cannot be taken into the school of their parents' choice in their local catchment area, but have to travel at least a mile to another school which is not necessarily the parents' or the child's choice. The child often has to go to a school outwith the community of his or her friends.

I welcomed the Prime Minister's statement on 6 May that consideration would be given to setting up a Northern Ireland Select Committee. It is good to know that fruitful talks on Northern Ireland are in progress. I underline again that the position of a Select Committee is not the responsibility of negotiating parties outside the House, but is the responsibility of the House. I urge the Government to introduce the necessary legislation to set up a Select Committee on Northern Ireland at the beginning of this Session so that we shall not have continued late scrutiny of some of the tragic mis-spending of the finances in Northern Ireland Departments.

I remind the usual channels of the understanding that the other Select Committees would be set up, not six months later, but immediately. I hope that, before the summer recess, those Select Committees will be set up. It is the responsibility of Back Benchers to scrutinise the affairs of Government Departments, and a Select Committee is the most efficient way of doing so. Perhaps that is one reason why some people are not in any urgent rush to see them set up. But as a Back Bencher, I plead that they should be set up speedily.

Last week, I wondered whether there was any significance in the fact that the right hon. Member for Mole Valley (Mr. Baker) moved the motion on the Loyal Address in a debate in which the Prime Minister later revealed the name of "C". Did that signify the fact that we would no longer need moles and that there would be open government or was it mythology, with the Government giving the impression of being open, but still concealing?

In future, will the Government answer questions asked by Members, or will the Government respond that the relevant information is not collected centrally, and can be gathered only at disproportionate cost? If there is to be open government, surely hon. Members should be in a position to know what is happening in the community so that they can bring an informed opinion to the House.

I welcome the fact that there has been a movement to improve security. However, I regret that it was not a secret, now revealed. Many years ago, when speaking to a noted officer of the Army in Belfast, I illustrated an incident by saying, "MI5 has been at work." He said, "Not MI5." We have had evidence of a perfect Government answer that tells us nothing that we did not know already. However, we have found evidence of a link, with Government talk about a new movement dealing with Irish loyalists as well as Irish republicans. What does that mean—loyal to Dublin?

7.56 pm

Dr. Robert Spink (Castle Point)

It is a tradition that I should be allowed a word about my predecessor. I have a hard act to follow, and I wish that I had £1 for every time that I have been told that. I follow someone whom this House holds in special affection; he was one of the most respected Members of Parliament of the post-war period. Sir Bernard Braine was first adopted for the seat that I now hold two years before I was born.

Sir Bernard carried with distinction and dignity the office of Father of the House, a position to which I do riot aspire. However, my aim is to follow in father's footsteps, though you, Mr. Deputy Speaker, will be delighted to hear that tonight I shall not be challenging Sir Bernard's once-held record for making the longest speech in the House. He did so to protect his constituents. Should circumstances arise when my constituents require protection, I trust that I would display all the determination and character, the tenacity and courage that never failed Sir Bernard during his 42 years as a Member of Parliament.

I thank the people of Castle Point for electing me; they are intelligent and discerning. We are a wonderful community, with excellent schools and increasingly superb hospitals. If only we had a railway line, everyone would want to live in Castle Point. That brings me to the Fenchurch Street line—the so-called misery line—and thenceforth to privatisation.

Between 1986 and 1992, 1,157 carriages have been delivered to nine lines, and 890 are now on order to six lines. But not one single carriage has been delivered or is on order for the misery line, which is why it is a misery line. It needs two things: investment, and sound management. Privatisation would indubitably secure good management, but could only partially help to solve the investment problem.

I am grateful for the £30 million that the Government made available to the line for new signalling, which was secured by my Essex colleagues last year, but there is a need, before privatisation, to make available investment for trains to replace the ones that are on the line now which are unsafe, unrealiable and downright unacceptable. I unequivocally welcome the railways legislation and I call for the misery line to be a pilot for service franchising. Care must be taken to ensure that British Rail does not exercise anti-competitive control over timetabling. We must have a tough regulatory body—with teeth.

To expand this theme, let me add that it is a fact that local councils try to do too much. They are there to provide essential services, not to interfere or to run businesses, farms estates or airports—yet that is what some do, at great, although well disguised, public cost. I therefore come now to two small but important areas of privatisation: first, county farms estates. Their original purpose has long since evaporated in the sands of time; they are an anachronism. I ask the Secretary of State to consider introducing legislation to divest local authorities of all but the most strategically important land holdings. Farms, like any other business, and like council housing, are mostly better privately owned and managed than throttled in the hands of bureaucrats and councillors. Divestment would release funds and provide more efficient services for the people whom the councils serve.

Regional airports are another small but significant target for privatisation. In 1969, the then Board of Trade —now a revitalised title—disposed of some regional airports to local authorities. I ask the Secretary of State to privatise these assets, as a matter of urgency.

I welcome the fact that the Government have a coherent, integrated and achievable policy on privatisation generally. This will help the country through recovery, and to secure the success and prosperity in the 1990s that was enjoyed in the 1980s. In so far as privatisation is successful, and it is, it will help to secure national prosperity and thereby enable us better to care for the poor and the homeless.

I understand that it is traditional to say a word or two about oneself. I come from Keighley in west Yorkshire, a place where the weak die young and the strong envy them their fate. Like our honourable Speaker, I worked in the textile mills, as a mill boy, a labourer, so, like the distinguished lady, I have worked for my living and kept myself since leaving school, that is, until arriving in this House.

I do not wish to appear uncharitable, but I will take no lessons about the working class from those on the Opposition Benches and their friends, some of whom have never held down a real job in their lives. I was asked by one Opposition Member whether I was a real doctor. I had to answer, "No, I am just a mill boy made good, a time-served and subsequently educated engineer." That question shows how we as a nation value our various professions. Nevertheless, I advised the hon. Member, "If it's your varicose veins, you need not worry—I understand that David Owen is looking for a job."

I hope during my time in this House to take every opportunity to champion the manufacturing sector, and to champion education, which provides the ladder of opportunity on which ordinary folk may advance by their own efforts. I have taken my chances and it has been my good fortune of late to help manufacturing industry to become more vital and to thrive. I therefore well know that Britain must maintain a vibrant manufacturing sector. This is our added-value, our wealth generation backbone, the spine on which the softer service and professional sectors must develop and without which they could not thrive.

Like Jane in the jungle, the service industries are appealing and most valuable to us and to our economy, yet they remain ephemerally vulnerable. My right hon. Friend the Member for Henley (Mr. Heseltine) is there, dare I say it, like Tarzan was for Jane, and he will advance our manufacturing sector and thereby secure the economy as a whole. The opportunities are unfolding before our very eyes. Our interest rates, industrial relations and even our inflation rates are looking attractive internationally, as are our political stability and sound government—and the financial markets are responding accordingly. Our privatisation programme is aped around the world, to continue my somewhat dubious metaphor.

Like my right hon. Friend the President of the Board of Trade, I will be busy. My constituency needs change to move smoothly towards the millenium. We need to create new jobs for Canvey and Benfleet, and perhaps an enterprise zone will be one of our considerations. We certainly need more further and higher education and training facilities—and a new railway line.

I wish finally to offer Opposition Members a little comfort at this time of no little confusion for them in their leadership contest. Four weeks ago they stood at the edge of a precipice, since when they have taken great strides forward. They should consider privatising their leadership selection process, bringing in a top-flight team of management consultants to advise them on the procedure, or even offering the job as a school project. That could hardly make their selection procedure any worse.

I end on a warm note, which I anticipate will unify the House. Perhaps this gracious and generous House will join me in hoping that we shall soon see Sir Bernard in a place not far from this Chamber in which he can continue to conduct his fight for human rights and against injustice across the world.

8.5 pm

Mr. Kevin Hughes (Doncaster, North)

First, I congratulate you, Madam Deputy Speaker, on your election to a new office and thank you for allowing me to catch your eye so that I can make my maiden speech. I also congratulate the hon. Member for Castle Point (Dr. Spink) on his maiden speech, although I reserve the right to disagree with a great deal of its content.

It is a great honour and privilege to be elected to this House by the good people of Doncaster, North. I pay tribute to my predecessor, Mr. Michael Welsh, who was first elected in 1979 for the then Don Valley constituency, which is now so ably represented by my hon. Friend the Member for Don Valley (Mr. Redmond). Following the boundary changes in 1983 Mick was re-elected, for the then new seat of Doncaster, North. He served the people of my area well for the past 13 years. He is well known in the constituency and, as a kind and caring man, he has devoted most of his life to politics, having served not only in this House for 13 years but for many years on local authorities—first on Adwick urban district council and then, following the local government reorganisation in 1974, on Doncaster metropolitan borough council. I am sure that all hon. Members, especially his friends and colleagues on the Foreign Affairs Select Committee, will join me in wishing Mick and his wife Brenda a deserved and long and happy retirement.

My constituency covers a fairly large area. The people are mostly very friendly and caring. The constituency is mainly based around mining communities, agriculture and small townships in which there is a strong tradition of community spirit and friendliness, and I am proud to be their representative.

The proposed improvements in agricultural marketing outlined in the Gracious Speech will, I am sure, be welcomed by those of my constituents—there are many —who live and work in the agricultural community. Like me, many of my constituents will be bitterly disappointed, however, that the Gracious Speech does not mention unemployment, a problem facing far too many of my constituents who have to live with the daily trauma of neither having a job nor the prospect of finding one. There will be deep resentment at the fact that the Government propose no measures of help for them.

My elderly and disabled constituents and their carers look forward to the introduction of community care. If it is to facilitate their needs—and their needs are many—it must be properly funded by the Government. Caring for the elderly and disabled at home is not and should not be a cheap option. I urge the new Secretary of State for Health to resolve as soon as possible with the local authorities the problem of funding so that they can confidently introduce their plans for the implementation of community care in 1993.

There is deep resentment and bitterness among many of my constituents at the proposed privatisation of the coal mines. Many were jubilant when the coal industry was nationalised in 1947. Men who gave their lives to the industry will he deeply saddened and its privatisation will be a bitter blow. My constituency used to have six pits but now there are only two. Many thousands have lost their jobs in mining and in connected industries in the past few years and they fear that privatisation will wipe out mining in Doncaster.

The men and their families at the two remaining pits, Bentley and Hatfield, are concerned for their future. They do not want to lose the prospects of future employment in the industry for the sake of political dogma. Some of my constituents already face joining the ever-growing number of unemployed following the surprise announcement two weeks ago by British Coal on closing the Markham Main colliery in Armthorpe in the constituency of my right hon. Friend the Member for Doncaster, Central (Mr. Walker).

The decision to close Markham Main was ruthless, vindictive and totally unnecessary. I sincerely hope that the new Minister will adopt a hands-on approach and will discuss the matter fully with the miners and their representatives who have worked in and for the mining industry for many years. I hope that he will treat them with the respect that they deserve and not rush headlong into an unnecessary mass closure and privatisation programme that will damage the livelihood of many of my constituents and their families. That would also sterilise one of the country's greatest assets, its massive coal reserves, and throw on the scrapheap our experienced and professional miners. It would be foolhardy and economic madness to close our mines and then import coal.

8.12 pm

Mr. Piers Merchant (Beckenham)

I congratulate the hon. Member for Doncaster, North (Mr. Hughes) on his able and confident contribution to the debate. I hope that we shall frequently hear him again. I also congratulate my hon. Friend the Member for Castle Point (Dr. Spink) on his eloquent, persuasive, forceful and humorous speech. I hope that he will be with us for as long as his predecessor.

Like my hon. Friend the Member for Croydon, South (Mr. Ottaway) who spoke earlier, I cannot presume as a former Member to make a maiden speech, but I hope to be granted some indulgence and be allowed to make some relevant and illustrative points about my constituency. My constituents, who were ably represented by my talented predecessor Sir Philip Goodhart from 1957, would not otherwise benefit from the special praise granted to a maiden speech for more than 35 years and may well have to wait another 35 years. The House deserves some explanation for my silence over the past four years lest some hon. Members feel that I have been unduly lazy or, worse, at a loss for words.

The Government propose paving measures for two privatisations. The ultimate privatisation is that of British Coal, and I thoroughly and whole-heartedly support that proposal. I describe it as ultimate because that industry's nationalisation was the flag carrier for Labour's clause IV. It was to pave the way and be the one on which the others were modelled. At the time and for many years after it seemed irreversible. Denationalising coal shows that the tide of post-war socialism has not just been turned but that the red sea has dried up altogether.

Coal privatisation is relatively straightforward and is the simpler of the two proposals. British Rail's privatisation poses a more difficult challenge, which is why the Government are right to approach it with some caution. Apart from other complexities, it causes most concern to ordinary people because they place a heavy everyday reliance on it. That is especially true for the people of Beckenham. My constituency boasts no fewer than 12 railway stations and there are 10 more within a short distance of its boundaries, although the constituency measures only four miles by two miles.

I would like to claim that the railways came to Beckenham because the good people there had such a good reputation that the railway companies were eager to serve them. Alas, that would not be true. People came to Beckenham because the private railways were already there and the small villages of that time were within easy striking distance of workplaces in the metropolis. Whether people would have moved to Beckenham if the rail service had been as it is today is a matter for conjecture. They would probably not have built their houses near the track if they had known that it would later be misused for channel tunnel international trains. Perhaps they would not have chosen to commute if the conditions and pressures had been as they now are under nationalisation. What better evidence can I present than the words of Sir Philip Goodhart who said in February last year: Normally the service from so many parts of my constituency to the centre of London is, to put it mildly, bad, but in the past five days it has too often been non-existent. It would be difficult to exaggerate the rage which so many commuters in my constituency feel about the way in which British Rail has tried to cope."—[Official Report, 12 February, 1991; Vol. 185, c. 793.] Sir Philip was well known to many hon. Members for his charm, wit and enthusiasm. In his constituency he was respected for his wisdom and his work in representing the people and their concerns. Sir Philip was an expert on Committee procedure in this place and wrote a book about that and another about referenda. His interest in those subjects and his care for his constituents continued until his retirement and I owe him a debt of gratitude for his constant support.

Despite the tribulations, about 15,000 people commute each day from Beckenham, mostly by rail. Even if they are not British Rail commuters they cannot ignore BR's omnipresence. At least 5,000 people live close to the tracks or stations and almost double that number are within earshot. I am speaking about the leafy middle class suburbs of Beckenham, an area which has been able to resist the encroaching pressures of inner London and retain sufficient of its character and its past to justify those who refer to it as "the village". That is why it is considered so desirable an area for those who need to commute, even by BR.

Beckenham's choice of housing, shopping and other facilities is broad and excellent, but there is virtually no choice for the consumer because there is a monopoly supplier—a state monopoly, inflexible, unaccountable and unpersuadable. The tube system does not extend to the area—that should be corrected—and the roads are slow and choked and cannot handle the volume of traffic. The Fees Office offered me air vouchers, but 14 miles from my constituency to central London does not make that an attractive option unless, of course, one owns a helicopter. I understand that one of my constituents has one. Privatisation offers the prospect of transforming the quality of transport for constituencies such as mine. It would not be an exaggeration to say that, if handled right, it would also transform people's everyday lives.

There is a mismatch between consumer expectation and the provider's service. Industry after industry has illustrated that private operation can overcome this obstacle which nationalisation created. A system of regulated franchising would provide the competition and accountability that fails to permeate the labyrinthine structures of a monopoly bureaucracy such as British Rail. The beauty of franchising is that it can introduce a form of competition, or of privatisation, even where there is a so-called natural monopoly. Making an operator bid for the franchise at once exercises a competitive pressure that a provider might otherwise escape, be he private or public. Requiring the franchisee to repeat the bid at regular intervals maintains and enhances that pressure.

Franchising does not just benefit the consumer by providing a form of competition, which itself enhances efficiency and maximises resource use, thus giving the customer better quality and prices. It also enables certain fixed standards of quality to be provided. Alongside the citizens charter is the franchise contract, with inbuilt requirements of service delivery—reliability, regularity and cleanliness, for example. Therefore, it brings three separate pressures to perform—competition, the contract and the charter.

These benefits will operate anywhere on Britain's rail system, but an additional element could operate in Beckenham and other areas that are similarly well-endowed with track—the possibility of direct competition.

One of the factors that makes Beckenham so attractive is its accessibility. It is possible to travel to London by rail by at least seven routes. Even British Rail identifies three different line systems—Kentlink, South London and Thameslink. In the far west, the constituency is dominated by the giant Crystal Palace tower, right on the boundary. Nearby are five rail stations, giving travellers a choice of five routes, some to the same and some to different London termini. In the middle of the constituency, five more stations offer three services and in the east three further stations offer two services. In every case, there is a choice, and therefore, in every case, there is the possibility of some, perhaps limited, competition.

Sometimes one route is quicker or more convenient than another, but often the difference is only marginal. The prospect of real competition exists, and if some of the different lines were run by different franchisees, that would become a reality. I hope that, as the franchise details are worked out, my right hon. Friend will try to avoid franchising whole sets of lines and will encourage the sort of competition that I have outlined.

Competition is a more effective way to bring back real accountability to ordinary people than any other system I know. With that will come enhanced standards, greater efficiency, better value for money. The beauty of this proposed privatisation is that it will retain the commitment to huge public infrastructure investment, higher than for 30 years, and leave BR with a role, but at the same time introduce privatisation.

8.22 pm

Ms. Glenda Jackson (Hampstead and Highgate)

I thank you for calling me, Madam Deputy Speaker, and I add my congratulations to those that have been offered by those who have spoken before me.

I pay tribute not only to my predecessor, Sir Geoffrey Finsberg, but to his predecessor, Ben Whitaker, who represented my constituency and my party from 1966 to 1970. I mean to emulate his dedication, if not his length of stay in the House. I have never had the pleasure of meeting Sir Geoffrey Finsberg, but he served my constituency well for more than 20 years, and I know that my constituents would wish me to extend their thanks to him, and best wishes to Sir Geoffrey and Lady Finsberg for a long and happy retirement.

My constituency has long exercised a particular fascination for the creative spirit. Many of the greatest artists, writers, musicians and philosphers that not only this country has produced but that the world has ever seen have chosen to make their homes there. My constituency has been blessed with great natural beauties, the glorious expanse of Hampstead heath being but one. The Vale of Health was so named because it was rumoured that the springs that rose there contained mystical power—a rumour somewhat belied by its proximity to that other famous landmark, Highgate cemetery.

There is a popular myth regarding my constituency, one much loved by the press, of a leafy suburb populated solely by millionaires whose only drink is champagne and whose only conversational exchange could be deemed to be chatter. The facts make a rather different picture. The largest single group in my constituency consists of pensioners, and the largest group within that group consists of those on some form of social benefit. This month, 5,000 of my constituents are unemployed. In the borough of which my constituency is part, 1,000 families have no home of their own. The Royal Free hospital, much loved by my constituents, which was, against their wishes, made into a trust, has announced waiting lists for in-patients running at 2,500.

The Prime Minister has spoken of his wish to provide ladders of opportunity for our people. However, a ladder can be a dangerous place if it is not rooted on a solid foundation and leaning against an equally solid wall. If it is dangerous for the most able bodied among us, how much more dangerous is it for the very old and the very young, the frail and the disabled? My constituents welcome the idea of greater opportunities being provided, but the opportunities must be available to all our people and they must be based on the solid building blocks of education, training, health care free at the point of delivery and, perhaps most important of all, decent affordable housing.

What rung of the Prime Minister's ladder will be earmarked for one of my constituents who has been unemployed for five long years? On what rung will be my elderly constituent who has been paralysed from the waist down with her arms and hands crippled with arthritis, who has now been denied bathing facilities in her own home because it has been decreed that such a facility will be provided on medical, not social, grounds? What part of that ladder has been earmarked for the young homeless who have no bed but the pavement, the doorway? What about the families who live for month after month in bed-and-breakfast accommodation?

Some in the private rented sector are suffering harassment and sometimes even violence at the hands of greedy, unscrupulous landlords. Surely the Government must acknowledge that it is time to release capital grants so that a programme of rebuild and repair can begin, and that more effort must be made to relieve the enormous burden that so many councils are having to carry, faced, particularly in London, with the continually rising tide of homelessness.

My constituents have always been concerned with the pursuit and obtaining of social justice, not only at home but abroad. My constituents are particularly concerned about the position of the third world. They ask why it is that in 1979 this country was the second largest donor nation of the G7 countries but that this year it is the second smallest. They acknowledge, as do I and my party, that aid alone cannot relieve the almost unbelievable burdens facing the people of the third world, but our country could do more than it is doing, and the aid that we supply could be more efficiently targeted on the poorest countries and the poorest groups within those countries. Our aid should be targeted on the basic requirements of health care— children are dying in their millions—and on providing clean water.

Another particular concern arising from the Gracious Speech, on which I believe that I shall be joining hands with my hon. Friend the Member for Sheffield, Hillsborough (Ms. Jackson), is the Government's promise to reintroduce the Asylum Bill. Many of my constituents came to this country as refugees. They were fleeing the appalling political and religious oppression that existed both before and after the second world war. Within my constituency they found sanctuary, a great welcome and the possibility to create for themselves and their family a future. It would be a tragedy if our nation's reputation for always taking in those suffering from persecution should be lost.

It is a great privilege for any person to be called to the House as a Member. It is a particular privilege for me to represent the people of Hampstead and Highgate. I am grateful and deeply proud that I represent them.

8.30 pm

Mr. David Nicholson (Taunton)

It is a particular pleasure to be able to congratulate the hon. Member for Hampstead and Highgate (Ms. Jackson) on her excellent maiden speech. Of all the new Members, she arrived in the House as the one perhaps best known outside it. We look forward to the contribution that she will make to our proceedings. As one who for some years lived within about 100 yds of Highgate cemetery, may I say that we are especially grateful to the hon. Lady for the tribute that she paid to Sir Geoffrey Finsberg, whom we remember with affection.

I congratulate you, Madam Deputy Speaker, and the other three new occupants of the Chair who will be with us during this Parliament. I congratulate also the many other hon. Members who have made their maiden speeches during today's debate. I shall single out one by referring to my next-door neighbour, the hon. Member for Devon, North (Mr. Harvey). Again, we are grateful to him for the tribute that he paid to his predecessor, Tony Speller, whom we remember with affection.

Along with many of my right hon. and hon. Friends, I wish to congratulate my right hon. Friend the Prime Minister on his success against the indications of opinion polls and almost against the odds of winning a fourth term for the Conservative party in extremely difficult circumstances, including a recession, the backlog of the community charge and several other issues that had upset Conservative voters. Our victory was in large part a tribute to the high esteem for my right hon. Friend the Prime Minister, which I believe extended to many thousands of those who nevertheless voted Liberal or Labour in the general election a month ago.

Another factor that helped to bring about that victory was great suspicion of the Labour party. The rather rambling speech of the hon. Member for Kingston upon Hull, East (Mr. Prescott) this afternoon will have confirmed electors in that suspicion. I recall the classical villain, I think it was, whose fate in Hades was to push a large stone to the top of a hill. When he had got it to the top, it used to roll down to the bottom. I think of the right hon. and learned Member for Monklands, East (Mr. Smith) and perhaps the hon. Member for Dagenham (Mr. Gould) as those who push the stone to the top of the hill. As soon as they get it there, the hon. Member for Kingston upon Hull, East pops out and pushes it down to the bottom of the hill. I fear that that will be the state of the Labour party in the coming months and, perhaps, throughout this Parliament.

Turning to British Rail, I welcome the various comments by my hon. Friends that suggest that there must be better ways of running a railway. I listened with great interest, however, to my hon. Friend the Member for Christchurch (Mr. Adley), and I echo many of his warnings. I begin a critique of British Rail by recalling a remark made by my hon. Friend the Member for Bury St. Edmunds (Mr. Spring), who in his maiden speech said "the engine started smoking". As an occasional smoker, I express regret that British Rail should now be trying to prevent even a minority of passengers from smoking. I hope that there will be opportunities to take up this matter in coming weeks.

Another small matter is my regret that the late-night train from Paddington was stopped some months ago from halting at Taunton. This has been an inconvenience to some of my constituents and a subject of correspondence in the local press.

An important matter for my constituency—it is typical of one of the weaknesses of British Rail—is the handling of freight. As a major environmental objective, we should be aiming to transfer as much freight as possible from road to rail, especially with the coming of the channel tunnel. I must report of Taunton Cider, an important employer in my —constituency.[Interruption.]

Madam Deputy Speaker (Dame Janet Fookes)

Order. I am aware that sometimes Members have occasion to speak one to another, but when I become aware of a ripple of conversation I think that it is too much.

Mr. Nicholson

I am grateful for your protection, Madam Deputy Speaker.

Until recently, a firm called Tiger Rail was able to provide a freight service on three days a week to Taunton Cider. I regret to say that that firm rapidly went bankrupt. I believe that British Rail has been helpful and now provides a service one day a week on Saturdays for freight. That service will run until August. That is satisfactory in the winter months, but I am told by Taunton Cider that it will not be satisfactory in the summer months, when stocks in many parts of the country are running low. It needs a freight service every day.

Before Tiger Rail took on this task, there was Speedlink. We know what happened to that. Taunton Cider and many other freight operators with British Rail have been messed around over the years by changes, transfers and withdrawals of service. At present, there is a possibility that a firm called Charter Rail will be able to provide the service that Taunton Cider needs, but this will require a different technical system and there will be more trailers to go with the wagons. I fear that this will once again cause frustration. I hope that the pressures of privatisation on some of BR's services will give a service to firms in my constituency and, I hope, to many others that look forward to using the channel tunnel that will be much better than that which they have had in recent years.

I move on to two other subjects that are slightly without the immediate scope of privatisation although they concern important public services which, I believe, will remain firmly within the public sector. I hope that they will be subject to progress under the citizens charter, for which my right hon. Friend the Chancellor of the Duchy of Lancaster has responsibility.

The first of the two subjects is law and order, and one that played a greater part in the recent election campaign than many of us would have wished. Unfortunately, I do not believe that we are making the progress in dealing with criminality that we would wish. Given certain reports in the weekend press, I urge my right hon. and hon. Friends to take care when making criticisms of and considering plans to reform the police. Part of the blame for our failure as a society effectively to combat crime lies with the machinery of justice, the Crown Prosecution Service and the consequences of certain well-intentioned legislation on police methods that the House has enacted in recent years.

We have greatly increased resources and manpower for the police service. Unfortunately, the numbers of criminals and crimes have increased still faster. I hope that there will be speedy implementation of the proposals that were made in the previous Parliament in respect of offences committed while defendants are on bail for which the Avon and Somerset constabulary pressed. I hope to return to the subject of the distribution of police resources. In Avon and Somerset there is a heavy concentration of police resources on Bristol because of its known level of criminality. I fear that therefore certain parts of my constituency, including rural areas, are not policed as effectively as we would wish.

My second point concerns an important public service that should have been debated more effectively during the recent general election—education. Again, I urge my right hon. and hon. Friends to beware of concentrating debate on institutional change. I would need to be convinced case by case of the advantages of grant-maintained status for schools in my constituency. The real issue in schools—and this will remain so whether or not there is grant-maintained status, especially with local management of schools—is not whether the Secretary of State or Somerset education authority runs the schools, but what is taught, by what methods, and the quality and morale of teachers and the resources, books and equipment available.

In the limited time available to me, I have taken the opportunity to welcome the various measures promised in the Queen's Speech, but also to echo certain warnings. Our success in the recent general election should not blind us to the considerable concern and upset that we have caused in recent years among our supporters. We should be thankful that they rallied to our support on 9 April.

8.40 pm

Mr. Paddy Tipping (Sherwood)

I congratulate you, Madam Deputy Speaker, on your appointment.

Hon. Members will know of Sherwood forest, its myths and its legends. People from Nottinghamshire, especially from the tourist industry, try to persuade people that all the tales are undoubtedly true. In contrast, the constituency of Sherwood is a far newer creation, having been formed in 1983. Its first Member of Parliament was Andy Stewart, who at one time was a colleague of mine. I pay tribute to him. Throughout the constituency he is known as a nice man. Indeed, so often have I heard it said that he is a nice man—a very, very nice man—that I think the AA advertisement must have been inspired by him. Andy and his wife Louise have helped many people in the Sherwood constituency who want their thanks put on the record.

I wish also to mention my old friend Frank Haynes, who at one time represented part of the constituency. He, too, is highly regarded locally. Rumour has it that Frank is to become a boxing commentator. I assume that in these tough times the broadcasters are trying to save microfilm expenditure.

Both Frank and Andy took an interest in the coal industry. Sherwood remains the largest mining constituency in the country, with six collieries, a workshop and the group headquarters. In his maiden speech in November 1983, my predecessor, Andy Stewart, said: It is my view that our coal industry has a great future."—[Official Report, 15 November 1983; Vol. 48, c. 748.] To put it mildly, his views were over-optimistic. In 1980, about 40,000 people worked in the coal industry in Nottinghamshire; today the figure is about 12,000. In just over a decade, two out of three mining jobs in the county have gone. Unemployment has increased—in the two years to March 1992 it rose by 62 per cent. Bankruptcies are still increasing and are at an all-time high. In Nottinghamshire in March, 6,513 young people aged 16 to 19 were seeking permanent employment. At that time there were only 22 vacancies in the careers office, so almost 300 youngsters were chasing every job. That is a waste of hope, of talent and of imagination.

Worse is to come. The Government's firm intention to privatise the coal industry has caused alarm and despondency in north Nottinghamshire. By itself, the plan to privatise the coal industry is an empty and hollow prospect. The key issue now facing the industry is the negotiations with the generators PowerGen and National Power. Some 80 per cent. of Nottinghamshire's coal goes direct to power stations. It is the volume and the price of coal supplied to the generators that will decide the fate of the mining industry in Nottinghamshire.

For their part, the generators have made it clear that they want a small and short-life contract. This year, British Coal is supplying 65 million tonnes to the generators, but there is speculation that the generators want a future contract with as little as 25 million tonnes over a contract period of only three years. If that were to happen, the coal industry both in Nottinghamshire and throughout the country would be decimated even further and there would be nothing left to privatise.

The Government should intervene quickly in the discussions between the generators and British Coal. The new Secretary of State for Trade and Industry has a reputation for being an interventionist. Some 40 per cent. of PowerGen and National Power still remains in the public interest. As the largest shareholder, the Government should insist on the high-volume, long-term contracts. A contract of 55 million tonnes a year would still mean job losses in the industry. I note that the electricity companies are signing 15-year contracts for gas-generated electricity. Why cannot there be parity for the coal industry?

Miners in Nottinghamshire and throughout the country have made enormous productivity gains under public control. Why discard them now? We have the most efficient deep coal mining industry in Europe. Last year, six of the Nottinghamshire group's 15 pits produced more than I million tonnes of coal, all of them setting new productivity records. British Coal has made a substantial operating profit in Nottinghamshire this year. Some 17.2 million tonnes were produced, with 5.6 tonnes per man shift. There has been a 64 per cent. improvement in productivity since 1985 under public control.

In 1985, British Coal in Nottinghamshire sold coal at £42.60 per tonne. This year, the price is only £42.93 per tonne. Over the same period, electricity prices have risen by more than 45 per cent. Nottinghamshire coal is being produced at half the cost of that in Germany. No other industrial sector can match that record, yet the Government's policy is to close down the coal industry. It is no wonder that all over Europe people think the policy is crazy.

This morning, Nottinghamshire county council called for an early meeting with the Secretary of State for Trade and Industry to discuss the future. Tomorrow, the North Nottinghamshire training and enterprise council, a private sector dominated body, will call for the halting of pit closures in the region because of the devastating effect on the local economy. On Wednesday, the new Energy Minister will visit the Nottinghamshire coalfield for the first time. He should listen carefully to the voices of local councils, the TEC, the private sector and the trade unions in the industry, which, without exception, are pledged to fight privatisation.

Present policies towards the coal industry will devastate it and the local communities that surround it. The Government and the Energy Minister will have few friends if they continue with those policies. On his visit, the Minister should take note of a few signposts. He could work towards a national energy policy, in which coal is given the same consideration as nuclear power. He could bring discussions on the new contract to a quick and satisfactory solution. He could keep the lid on the amount of gas-generated electricity produced. He should use the powers under the planning system to stop new gas-powered generators.

At a time of potential energy surplus, the Minister should stop opencasting. It is obscene. It tears up hedges, trees and acres of fields, even though there is plenty of coal and other sources of fuel around. I implore the Government to listen to the voices of local people on this issue because they will not win environmental and planning support.

The Minister should keep open the discussions with our European partners about the plan for a European reference price on coal. He should ensure that commitments made on gas scrubbing equipment are honoured. He should make more resources available to assist economic regeneration in coalfield areas. He should build on the partnerships that exist there and bring new jobs, new investment and new prosperity to those areas.

Despite all the promises that have been made, the European RECHAR money has yet to be announced. The Department of the Environment's regional office has no idea of the transitional arrangement for the current financial year, or of how the £13 million earmarked for Nottinghamshire is to be unlocked. The Minister would do well to view those signposts on Wednesday.

The Minister will be surprised at the youth of Nottinghamshire miners, whose average age is 34. The miner's future and that of his family and community depends on the coal industry. The Government can take action to safeguard their futures. The Government should take careful note of the partnerships that exist in Nottinghamshire, and not be driven by the dogma behind some of the speeches that have been heard in the Chamber today.

8.50 pm

Mr. Barry Field (Isle of Wight)

I congratulate you, Madam Deputy Speaker, on your appointment and the hon. Member for Sherwood (Mr. Tipping) on his maiden speech. I also thank him for his generous remarks about his predecessor, Mr. Andy Stewart. If the hon. Gentleman manages to gain his predecessor's reputation as a most agreeable and approachable Member of Parliament, the hon. Gentleman will do himself no harm.

I cannot follow the hon. Member for Sherwood in his remarks, because I believe that Nottingham's coalfields face a bright future under privatisation. They are among the most productive in the country. Many years ago, I visited a Nottinghamshire coal mine with my middle brother, and I was thoroughly impressed with its modern equipment and the productivity that it achieved.

No contribution of mine to the Loyal Address would be complete without mentioning the pleasure that is felt by all my constituents, of all parties and of none, at the appointment of my noble Friend Lord Mottistone as the Isle of Wight's new governor. The 1992 general election campaign will go into my family scrapbook as one of governorships.

In a unique constituency such as the Isle of Wight, there could be no greater claim to fame than that it is the only part of the United Kingdom to have a governor. Lord Mottistone's family have given distinguished service to the island for many years, and I know that his appointment is universally acclaimed.

The Isle of Wight's other unique claim is that it is the largest constituency to be represented in the House. I welcome the promise made in the Gracious Speech of legislation to speed up regular reviews of parliamentary boundaries. We hope that later in the lifetime of this Parliament, following the local government commissioner's review of the island's structure, the Isle of Wight will have a unitary authority. It would be nonsensical to see a decrease in the number of councils and councillors, which currently total three and 100 respectively, and an increase in the number of its Members of Parliament, when they might not agree with one another. However, regular reviews in future will prove useful.

When my hon. Friend the Member for Hampshire, North-West (Sir D. Mitchell) was a Minister in the Ministry of Transport—and what a proud dad he must have been when his son so ably seconded the motion on the Loyal Address last Wednesday—he assisted me in furthering my efforts to bring about the privatisation of British Rail's assets on the Isle of Wight. I read with great interest this week that Richard Branson is holding discussions with Mr. Chris Green, British Rail's InterCity manager, because it was the same Mr. Green who set back our plans for the sale of BR's Isle of Wight assets.

The line in question runs from the end of Ryde pier to Shanklin, using 1940 ex-London Transport tube trains. Announcing that British Rail had no intention of selling its assets in the Isle of Wight, Mr. Green said that the island's railway line was a necessary and integral part of Network SouthEast. With that quality of senior management running British Rail, one might imagine that it could not run a brothel in a garrison town—and that were it to do so, it would probably make a loss. If Mr. Chris Green were in charge, all the passengers would have to stand for the whole of their journey.

My hon. Friend the Member for Hampshire, North-West and I were sad that we were unable to bring about progress on the sale of BR's assets, but my hon. Friend the Minister for Public Transport has been of great assistance in pursuing that objective.

A number of issues will come out of the privatisation of British Rail and its assets. Why is it that taxi drivers on the Isle of Wight must pay a considerable sum for the use of British Rail's station forecourts, when their London counterparts pay nothing at all? I asked the present British Rail chairman why it was necessary to use uniformed railwaymen to run left luggage offices. Surely it does not take highly trained railway personnel to run that facility and to guard passengers' suitcases.

As my right hon. Friend the Secretary of State for Scotland is to wind up this debate, I cannot resist the opportunity to draw attention to the island's ferries. A Monopolies and Mergers Commission inquiry just before the general election concluded that the island's ferry crossings are the most expensive in the world—and there have been further price increases since that report was published. My right hon. Friend the Secretary of State for Transport has said that the Director General of Fair Trading will review that matter in three years' time.

I remind my right hon. Friend the Secretary of State for Scotland that the MMC identified a definite correlation between the quality and price of a service and increased competition. The existing ferry companies operate from the best harbours and routes. If further harbours and other facilities for ferries are to be established to allow greater competition, we must ensure that the Isle of Wight is included in the new assisted areas map when it is redrawn. My right hon. Friend the Minister for Industry has promised me that the island's case will be carefully considered. Only with that kind of finance can the island hope to establish the additional facilities that will provide increased competition across the Solent.

When I was young, the debate in our nation concerned whether one had been educated privately or publicly. I have long subscribed to the view that the chasm that goes to the core of the nation now divides the privately employed and the publicly employed. One of the sad features of the election debate was the accusation that we had not looked after public servants. The civil servants in my constituency, however, occupy some of the best office accommodation on the Isle of Wight: many employees in private industry and commerce would like similar accommodation.

I believe that one of the challenges that face my right hon. Friend the Prime Minister is the requirement to ensure, through the citizens charter, much greater cross-fertilisation between the two sectors. I look forward to the day when I learn, by means of a parliamentary question in the House, that more than 50 per cent. of the First Division Association have industrial or commercial experience. The "teachers in industry" project has been one of the great success stories in education. Initially, academia was sceptical; but, as the word went around the staff rooms, teachers became increasingly enthusiastic about getting out and getting a taste of industry.

I hope that, in the future, our civil servants will regularly go off to work in industry, and will then return. I also hope that the private sector will come into the civil service and then go out again. Currently, pension arrangements and terms of engagement make that almost impossible. That, I think, is the real challenge that will face my right hon. Friend until the turn of the century.

On 9 April, my right hon. Friend attained a notable victory. To be pitchforked into that high office just 18 months before an election would have been an achievement in itself. The achievement of a fourth and historic victory was quite a mountain to climb, and to do that in contradiction of the opinion polls constituted a remarkable personal achievement. But to fight the election during the deepest recession that the nation has seen for more than 60 years was a particularly remarkable personal achievement. Not for nothing will my right hon. Friend become known in the hearts and minds of our people as "Honest John".

9 pm

Mr. Alan Milburn (Darlington)

It is with a great sense of pride that I rise to make my maiden speech—in, appropriately enough, a debate about the future of British Rail. As hon. Members will know, the railways and the town of Darlington, which I am proud to represent, are virtually synonymous. Darlington, however, has another reputation, of which hon. Members are probably aware: its reputation as a barometer marginal seat.

It is my pleasure to say a word or two about my predecessors. My immediate predecessor, Michael Fallon, was a man of impeccably right-wing views. Indeed, he remained a devoted follower of Mrs. Thatcher even when that fell somewhat out of fashion on the Conservative Benches. He was, none the less, a hard-working Member of Parliament who rose to junior ministerial rank, and I wish him well in his new career outside Parliament.

I also pay tribute to my two immediate Labour predecessors, Ossie O'Brien and Ted Fletcher. Ossie had the misfortune to serve in the House for only six weeks after his splendid victory in the 1983 by-election; Ted, by contrast, sat for nearly 19 years, often bucking the national trend by dint of his diligence and personal popularity in the town of Darlington. Like those hon. Members, I will always put Darlington's interests first, and will do my utmost to maintain their record of service to the town's residents.

As hon. Members will know, Darlington gave birth to the railways, and so helped to spawn the first industrial revolution. Happily, that spirit of engineering enterprise and skill remains alive today in the string of top international companies for which Darlington is home: Cummins, Bowaters, Torringtons, Rothmans, and Cleveland Structural Engineering, to name but a few. One of those companies, Cleveland Structural Engineering, beat off international competition last week to win the contract to build the Tsing Ma bridge in Hong Kong. The bridge will be the largest structure of its kind in the world, and, like the Sydney harbour bridge, the Tyne bridge and the Humber bridge, it will be built in my constituency. I hope that hon. Members on both sides of the House will join me in congratulating both the work force and the management of CSE on their well-earned success. Whenever I have visited the Yarm road factory, I have been immensely impressed by the skills and commitment that I have seen there; now, they have obtained their just reward.

Although I am delighted by Cleveland's success, after hearing the Gracious Speech I am less optimistic about the future for British industry as a whole. The speech was virtually silent about the economy, which remains in such dire straits. That the word "unemployment" did not even earn a mention is an insult to the 4,740 people in the Darlington district who remain without work. The recession has already cost 1,300 manufacturing jobs in my constituency, but all the major forecasts suggest that unemployment is set to go on rising.

Last year's record fall in industrial investment risks plunging the country into a repeat of the economic mistakes of the mid-1980s—capacity failing to meet demand, thus forcing up imports and prices and lea ding inevitably to a Government-engineered slowdown. Companies such as CSE deserve better than that. They should be able to rely on the same support as is available to their foreign competitors from their home Governments: measures to stimulate investment in training, transport and technology. Yet here, in the middle of the longest recession since the war, we have the spectacle of the Durham training and enterprise council being forced to cut adult training by more than 20 per cent. in Darlington because its budget has been squeezed dry once again. It is a scandal that those offering youth training will have to provide more for less. Funding for non-endorsed training weeks has fallen from £31 to £28. What was training on the cheap is rapidly becoming training for a pittance.

These cheap and nasty cuts are pouring Darlington's future down the drain. I fear that, without a change in policy, Darlington's very real potential for economic take-off will be grounded, even before it has started. That would be a tragedy because, as Cleveland's success amply shows, we have much to be proud of in the town of Darlington. The town is ideally placed to be at the core of a new industrial revolution that will bring more high-quality, high-skilled, high-tech, and high-paid employment.

Darlington's fortunes, however, depend upon the Government removing the ideological blinkers that so restrict their vision and rethinking their hostility to manufacturing and their indifference to the north. The Government's preoccupation with the privatisation of the railways is, classically, a triumph of ideological hope over the experience of those countries who owe their fast, efficient and safe railway systems to Government policies on planning and investment. The dictum that the market, and nothing but the market, can bring prosperity to areas like the north has proved disastrously wrong. After 13 years, unemployment is higher, the number of people in work lower and the gap between the rich and the poor ever wider.

Last week I listened with great interest to the Prime Minister's promise to open up the powers of Government to public scrutiny. I hope that he will go one stage further and devolve power out from Whitehall to the regions and nations of our land. If the Prime Minister is serious about breaking down concentrations of unaccountable power, he will begin by reversing that process of creeping centralisation that has so characterised Conservative party policies since 1979. The north not only needs restoration of regional policy and proper investment in our transport infrastructure to allow us to compete against better placed regions and nations at the core of the single European market, but we need the right to determine our own future through a new structure of regional government that will take power from the centre.

Any process of devolution should include giving towns such as Darlington the right to run all their own services. In 1974, Darlington lost its county borough status because of the last Conservative reorganisation of local government. Ministers now have an oppportunity to put matters right by returning to the people of Darlington the powers that are rightfully theirs. I am looking not for any special favours for Darlington, but for policies that will rightly reward the vigour, loyalty and skill of its people. Too many of my constituents have paid the price for the records that the Government have set in the town in recent years—record bankruptcies, record mortgage repossessions and record hospital waiting lists.

I fear that the policies in the Gracious Speech mean yet more of the same. Darlington deserves a new spirit that forsakes the short term, the quick fix, the "me at the expense of the rest"—a spirit that says that all of us rely on common services because we are all part of the same community.

For those of us who grew up in the north-east, the past few years have seen a loss of that sense of community which used to characterise life there. When the Conservative party declared that there was no such thing as society, it acknowledged that, by its policies, people had been cut adrift from their communities, and as community has been denied so hope has been smothered. Hope can return to the communities of the north-east, but it needs policies that put talents to use rather than allow them to go to waste; policies that will reduce crime by putting sufficient police officers on our streets. It means policies that will restore pride by cleaning up our environment. It means tackling the obscenity of homelessness and investing in our hospitals and schools. It means, above all, giving regions such as the north-east and towns such as Darlington the chance to compete. It will be my privilige to fight for those policies in the House, I hope for many years to come. I shall do so in order to benefit the whole community of Darlington.

9.11 pm

Ms. Angela Eagle (Wallasey)

Following overseas development questions earlier today, I must be the only Opposition Member who is quite pleased that the Minister for Overseas Development is in the other place.

Any new hon. Member rising to make their first speech in the Chamber cannot help but be aware of the history and tradition that reside in it. Traditionally, a maiden speech is non-controversial, praising one's predecessor and describing the constituency, yet some distinguished hon. Members, past and present, have maintained a tradition of rabble-rousing and controversy. Indeed, we have heard some speeches like that this evening.

Which tradition should I follow? I believe that no tradition deserves to be honoured for its own sake but only for its intrinsic merit and relevance to modern-day conditions. We must move with the times if we are not to atrophy into some quaint but irrelevant sideshow, fit only for tourists to admire.

In a real sense, the fact that I am here tonight is a most welcome break with tradition, because it is my privilege to be the first Labour Member for Wallasey—an honour for which I thank the voters of the constituency and those who worked so hard on my behalf. I believe that I can say with some feeling, as Shakespeare wrote, that some traditions are More honour'd in the breach than the observance. It is not my intention, however, to break with the tradition of paying tribute to my predecessor, the noble Baroness Chalker. She was a formidable opponent, and I know that she was a popular and well-respected Member of the House—and deservedly so. She served Wallasey well for 18 years. I recall that she was the first Member of Parliament whom I questioned when I attended a meeting of the Hansard Society as an enthusiastic 14-year-old schoolgirl. I remember asking her a question about the future of the other place, which specifically related to its possible evolution as a democratic chamber. She gave me a response that I could not agree with then and I still do not agree with now, but as long as the other place remains in its present form I am certain that she will make a worthy contribution to its deliberations and I wish her well.

The constituency of Wallasey is located across the Mersey from Liverpool in the north-east of the Wirral peninsula. The derivation of the name most generally accepted is that it means "Island of the Welshmen". The pre-Doomsday history appears to show that the area was used by Celts sheltering from avaricious Saxon raiders. Thus Wallasey can, I believe, rightly express its solidarity with the endeavours of its Celtic descendants in Scotland and Wales who must, in the aftermath of the general election, engage once more in a similar activity.

Wallasey is a place of constrasts encompassing residential areas, derelict docklands, council estates and a seaside resort. The years of Conservative rule have hit Wallasey hard. Not only have two recessions in a decade decimated the basic manufacturing industries on which the prosperity of the area was founded—especially the shipbuiding industry—but the continuing recession is threatening what is left. As a result, unemployment in the area is a chronic problem which affects nearly one in five of the working population if one counts those who are left out of the reckoning by the statistical redefinitions of unemployment so loved by the Government.

It is not unusual for me to meet constituents who have been jobless for 10 or 11 years, but the Gracious Speech —as has been pointed out many times today—made no mention of that problem. Any decent humanitarian Government would develop a strategy to deal with it and I implore the Conservatives to do so. Worthy attempts are being made by Wirral council and the local chamber of commerce to attract new business to the area, but their efforts have been undermined by the recent decision to raise the tolls on the Mersey tunnels to unacceptably high levels. That has hit commuters and businesses and is acting as a brake on any possible economic revival.

My hon. Friend the Member for Newport, East (Mr. Hughes) recently initiated an Adjournment debate on the increase in the Severn bridge tolls. There is a similar problem with the Mersey tunnels about which my constituents feel very strongly. It is high time that the Treasury did something about the injustice of tolls and the unfair penalties currently meted out to those living in areas where the local authorities were far-sighted enough to build essential river crossings—whether bridges or tunnels —long before the Department of Transport got around to it.

I welcome the commitment in the Gracious Speech to combat the trafficking and misuse of drugs as there is, unfortunately, a growing drug problem in the Wirral. It is not only a personal tragedy for the victims of this scourge but it contributes to the rising rate of violent crime and causes much needless fear and misery. We must recognise the extent to which poverty and deprivation help to fuel such problems. It cannot be right to create a two-tier society which excludes significant numbers of people from the advantages that many others take for granted and then to expect that social problems will not emerge as a result.

It will not surprise Conservative Members if I say that there are many aspects of the Gracious Speech with which I cannot agree. Of its proposals, the attempt to privatise British Rail and British Coal are among the most objectionable. Other hon. Members have spoken in more detail about their objections to those proposals and I intend to confine myself to a few comments about the principle of privatisation itself. I see little merit in it. Indeed, I believe it is driven by the ideological obsessions of the Conservatives and lacks a firm empirical or theoretical justification.

One link that it is important to pinpoint is that between privatisation and redundancy. Another discernible link is that between privatisation and the seemingly inexorable rise of chairmen's salaries. For example, British Gas had 104,000 employees in 1980 but only 81,000 10 years later. Meanwhile, the chairman's salary had increased from £109,000—almost £1 for every employee—in the year of privatisation to £370,000 last year. It is safe to say that that has been an above-inflation increase. I think that many users will also have noticed the increased efficiency in sending final demands and cutting off the supply which the privatisation of the utility has brought in its wake. The primacy of profitability over all other concerns in privatised industries often means that social obligations come a long way down the list. There is a great deal of nonsense in the current dogma on the Conservative Benches that private is somehow good and public is bad. These proposals are based on that false premise and to that extent they are undesirable and wrong.

The Prime Minister said in his post-election speech that he intended to be a Prime Minister for all the people, not just for those who voted for him. The people of Wallasey will judge him by those words. They expect action to return prosperity to their area, and that means a sensible regional economic strategy and a flight from the current economic dogma which these privatisation proposals symbolise.

9.20 pm

Mr. Donald Dewar (Glasgow, Garscadden)

This debate must be some sort of a world record because I find myself rising after 14 maiden speeches. My hon. Friend the Member for Wallasey (Ms. Eagle) said as part of an absolutely first-class contribution that tradition is not always right and should not always be observed. It was a splendid speech and I was interested in her prediction about the role of the Celts in the House over the next year or two. I shall certainly take her advice about tradition. I am sure that my hon. Friends and other hon. Members will forgive me if I take the maiden speeches at a fast trot, if that is the right way of putting it.

Mr. Prescott

Donald the Trot.

Mr. Dewar

We are exporting them. It is one of our little Scottish successes. Better keep your tolls and your bridges: that might discourage them. [Laughter.]

As I was saying, there was a long-honoured tradition of the nervous wait. As far as I can see, that has been well and truly buried by this generation of Members. The standard, too, has risen tremendously over the years. I first came to the House in 1966 for a brief period, by mistake. [Laughter.] My then constituents put that right at the first possible opportunity. I cn remember what the House was like in those days and I can say with certainty that the standards have constantly risen in the intervening period. Moreover, I have the rather uncomfortable feeling that they are continuing to do so.

My hon. Friend the Member for Sunderland, North (Mr. Etherington) referred to the fact that one of his predecessors died of apoplexy after a council meeting. I fear that at times his temper and health may be sorely tried in his new career. My hon. Friend the Member for Nottingham, East (Mr. Heppell) showed his inexperience only once: when looking round what seemed to me to be an almost crowded House he referred to the small attendance. He will soon learn. I congratulate him on his speech and the remarkable achievement of a 10.6 per cent. swing to Labour.

My hon. Friend the Member for Hampstead and Highgate (Ms. Jackson) is another who will get used to characteristically thin Houses in the time ahead. There is a small book of reference circulating on the Front Bench so that we can catch up with who is who. I notice that she is described in it as a shop assistant sponsored by the Associated Society of Locomotive Engineers and Firemen. There is some passing mention of other interests. I have to say to her that it is not easy to come here with a reputation from outside, but the worth of her speech suggests that she will live down that disadvantage speedily.

My hon. Friend the Member for Sheffield, Hillsborough (Ms. Jackson) made a first-class speech, concentrating on education. My hon. Friend the Member for Doncaster, North (Mr. Hughes) is one of a number who showed a deep knowledge of the mining industry. I am always amazed that as numbers in the mining industry decline people ask me where they all go, and I know. [Laughter.] My attention to that phenomenon was drawn by the appearance in our midst of my hon. Friend the Member for Midlothian (Mr. Clarke). He is what is known in Scotland as a kenspeckle figure. That means roughly that he has been shouting at me for the past 30 years. I certainly welcome his arrival. He knows his own area and the mining industry inside out—perhaps upside down would be a better way of putting it. He has served on the national executive committee of the Labour party and has come back for more. What more can loyalty demand?

My hon. Friend the Member for Sherwood (Mr. Tipping) recorded a famous victory and made an outstandingly sincere and knowledgeable speech. I certainly welcome the contribution of my hon. Friend the Member for Darlington (Mr. Milburn). I am glad to have Darlington back in the fold. I remember the by-election as I was there, and I remember the short life—parliamentary life, I am glad to say—of the then Member. I recognise the importance of that seat as a balancing point in British politics. However, the remarks that my hon. Friend the Member for Darlington made on the devolution of power endanger him being classed as a honorary Scot. I do not regard that as a great disadvantage, but he may find it a mixed blessing as things proceed.

It is only right to recognise that hon. Members on the Conservative Benches have made maiden speeches as have hon. Members from other parties. The hon. Member for Devon, North (Mr. Harvey) particularly impressed me. He has left the Chamber because he is a very important person as he has the secret of instant success. I cannot remember a maiden speech in which the person making it could announce that he was the transport spokesman for his party. I then remembered that the hon. Gentleman was a Liberal.

The hon. Member for Bury St. Edmunds (Mr. Spring) told us about dramatic happenings at his local railway station. For those who were not present, it may seem rather cryptic, but I give the categorical assurance that I shall never travel from Bury St. Edmunds to Clacton on an Easter Sunday. The hon. Member for Erewash (Mrs. Knight) made an extremely competent and effective speech, on which I congratulate her. I had always thought that lace and old lace were made in Darvel and Newmilns in Ayrshire, but I now know better and I am glad for that information.

The hon. Member for Castle Point (Dr. Spink) had an unfortunate start. All sorts of people wished him as long a life as his predecessor, Sir Bernard Braine. I would not wish on anyone 40 years in this place. As an ex-solicitor, I know that that is the equivalent of four life sentences. There was also a good speech from the new Plaid Cymru Member, the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis).

Before I turn to the subject of the debate, I apologise for not dealing with the retreads, one or two of whom had a spin during the proceedings. If the hon. Member for Croydon, South (Mr. Ottaway) is properly reported in the public prints as having skiing and yachting as his principal interests, I can assume only that he will not be spending all his time in Croydon.

This is a debate about the Queen's Speech and, later, I want to say a word or two on what I am supposed to be talking about. Before I do that, I want to say a word or two about Scotland—a place somewhat to the north of this House. I wish to do so because the Scottish Office is a Department that scores low when it comes to ideas and, I am afraid, that is true of this Queen's Speech. The Scottish Office's contribution seems to be a collection of fairly unimportant bric-a-brac. I noted, although I am not surprised, that there was no reference or even a nod in the direction of the constitutional issue. There was nothing but a noticeable silence. I do not intend to spend much time on that, but I confess that I diagnose—I hope that this will not embarrass the Secretary of State—some very modest progress.

The Government now accept that there is a problem, but the trouble is that they have no idea at all as to what to do about it. They do not know how to prevent the Scottish question becoming, in the Prime Minister's particularly unhappy phrase, "a running sore" in British politics. It is perhaps too much to expect the Secretary of State to spell out the Government's intentions. After all, it is very difficult to define a void, but what we can expect is some account of the methodology and the timetable. In the debate on the Queen's Speech, the Prime Minister said: We will take stock of the present position in Scotland and then report back to the House. It is a matter of some importance and we will proceed with it. We are proceeding with it now, and when we have concluded, we shall report back to the House."—[Official Report, 6 May 1992; Vol. 207, c. 67.] Those words are of some significance.

If the process is under way, as the Prime Minister specifically states, the Secretary of State should be able to give some useful information. Press reports this weekend suggested that it is all happening in Cabinet Committee L and the Secretary of State has been added to its numbers for the occasion. The proceedings of that committee are no doubt clothed in mystery. Indeed, it may be one of those Cabinet committees that, in theory, does not exist—I do not know—but the right hon. Gentleman can surely give some basic facts. Is the study on the government of Scotland specifically or does it take an overview of the United Kingdom as a whole, considering the problems of Wales and other areas like the north, where the centralised system has served the people ill?

In Scotland on Sunday 10 May, we were told that Downing street warned last night that the Prime Minister is taking stock and that debate still has a long way to run. There is nothing planned for Scotland in the next 18 months and we can't even say that it will be in the next 18 months after that. Can the Secretary of State, at the very least, knock down that dreary message that suggests a policy of inaction and delay? Are we really expected to live for the next three years under a Government who have nothing planned for Scotland? Does not he realise that such a timetable is simply unacceptable?

Lord Fraser of Carmyllie, a Minister in the other place, who was plucked from the respectable political obscurity of the law to deal with constitutional matters, has promised "substantial not cosmetic change". Is his remit to wait and see what happens in Committee L or some other mysterious inner sanctum of Downing street, or has the Scottish Office an independent right of action? Scotland should know the outline of that unlikely concept —a Tory plan for constitutional change—at the earliest possible moment.

The Prime Minister has said that the objective is to make the Government more responsive to the needs of Scotland and that that must be done in a way that will not damage the Union. I agree, and I emphasise that Scotland's future should be as a full and equal partner in the United Kingdom. However, a certain way to damage that future is to show inflexibility now.

The Secretary of State must recognise that he will buy no friends with proposals that simply tinker with the present system. A Question Time in the Scottish Grand Committee or the appearance of a Scottish Select Committee are no substitutes for a genuine shift of power —the breakdown of the all-enveloping power nexus in Whitehall that has been at the heart of the present insensitivity of Government.

We expect the Scottish Select Committee to be brought to life but such a development should be justified on merit, not seen as a flimsy cover for a refusal to act on the central issue. The change that Scotland wants and needs cannot be met by some hybrid advisory body caught in a no-man's land between local and central government. The test—the essential benchmark—is the creation of a directly-elected body reflecting Scottish opinion and with the power that matters in a democracy—the power to make law. If the Government are prepared to do business on that basis, there will be real hope of progressing to a stable future.

There are many other issues in the Queen's Speech but one of particular interest today is the privatisation programme. I listened with interest to the contribution of the Chancellor of the Duchy of Lancaster. It was philosophical in approach but showed a remarkable disdain for practical detail. Perhaps naively, I hoped to learn something about the Government's plans. I did not. I accuse them of the oldest trick in the book, which is defining the opponent's position in a way that has nothing to do with the facts but everything to do with the convenience of one's argument. The Labour party is not still living in the shadow of Herbert Morrison. We are not spending our time debating the future of 200 monopolies or the legendary commanding heights. It is no good putting that up as our position in order to knock it down for personal satisfaction.

I was extremely intrigued when the right hon. Gentleman paraded the water industry as the ultimate argument against public ownership. It was a little less than tactful given that the debate was being summed up by the Secretary of State for Scotland, who has conspicuously —and rightly—not followed the path of privatisation of the water industry.

The argument is now about public interest and control, not about ownership. The Chancellor of the Duchy has a reputation for intellectual depth. At times, he sounded like Ronald Reagan, muttering about the wickedness of the concept of government. It is all nonsense and I suspect, to be fair to him, that he knows that it is nonsense.

The problem about the privatisation issue, particularly the public utilities, can be seen as the action of the Government. They have had to scramble, patch, mend, duck and dodge—trying to build in the regulatory machinery. They have been inventing strange concepts such as competition by comparison when we know that, in reality, there is no competition.

The case against privatisation is simple. For all that the balancing act is difficult to achieve and, ultimately, the balance between profit and the interests of shareholders is difficult to reconcile with the interests of consumers, is the right price the price that the market will bear or the price that the consumer deserves? There will always be tension and confrontation between those two concepts. I am left with the uncomfortable feeling that much of the enthusiasm is based on prejudice and ideology, and some of it on the attraction of the financial proceeds of privatisation that shore up the rickety structure that the Government call a fiscal policy.

There is a paving Bill, which deals with coal and rail, but tells us nothing. The questions that remain are fundamental and far-reaching. Privatisation is a term that is hard to define, as I think that the Chancellor of the Duchy will recognise. He looked distinctly shifty on that issue, but he ultimately admitted that what was proposed for the railways in the Queen's Speech was not privatisation but something different. In our view, what is proposed is misconceived, but it is not the ultimate in privatisation.

The reason for that is clear. It is because the former Secretary of State for Scotland, the right hon. and learned Member for Edinburgh, Pentlands (Mr. Rifkind), and no doubt his predecessors, spent many months wrestling with the problems and trying to devise a privatisation scheme that they could present to the House. We have followed their tortured arguments, through newpaper cuttings and the media, but, ultimately, those politicians could not do it. Instead, they have come up with a different sort of scheme—a halfway house that they are presenting because they know that their ideology will not work in practice.

The argument is not simply about the wider vision of the inter-relationship between citizen and state, as the Chancellor of the Duchy tried to suggest. It was almost comic when the hon. Member for Southend, East (Sir T. Taylor) rose. He was not interested in that aspect, but wanted to know what the legislation would mean for the trains that run to Southend—a relevant and sensible question. If there is to be a private operator on the route to Southend, how is the rent that he pays for the track to be priced? How is his contribution to overheads to be priced?

I am told by those who know the Southern region better than me that British Rail is about to spend £50 million modernising the Southend line. If that is to be public money, how much is the southern version of Stagecoach to pay as its contribution to that sort of fixed overhead? What sort of contribution will it make for the right to run those trains? That is the sort of question to which the Government will have to find convincing answers quickly.

It is one thing to say that a firm such as Stagecoach can hitch on a couple of carriages. It may not be a sensible suggestion, but it is limited. But is the policy to go further than that? Will the firm be able to put on its own trains, drivers and staff? If it does, what will happen to safety standards and training? What happens to the untrammelled right to run the trains? Will it remain untrammelled or will there be arm's-length negotiations with the railways ultimately being able to say, "No more"?

Will the Minister address the issue of the picking off of the best routes in Scotland? Can he guarantee that, whatever happens, the routes in a district which constitutes one third of the land mass of Britain and which is heavily dependent above the central belt on public service lines will still run and still be funded?

What can we make of the position when Scottish papers are full of speculation that Waverley station in Edinburgh will be the prime site that is sold first as the flagship of the new compromise? We find tagged on to an article in the Sunday Mail the reassuring news that A private company buying the station would have to give access for ScotRail track, trains and staff. That is a relief—at least we are guaranteed that Waverley station will still have trains after the wonders of privatisation.

Can the Minister deny or confirm the report that appeared on the front page of Scotland on Sunday on 10 May that the Scottish board of British Rail is about to be disbanded? I hope that he can give us an assurance that that is not so, particularly in view of the reason given in the article, which is that the board does not want ScotRail's advisory board leading private or public opposition to piecemeal privatisation north of the Border". It seems a sad state of affairs if, in order to try to muzzle opposition, we start disbanding important parts of the advisory and management mechanism of British Rail.

Why is the public against this privatisation—a fact conceded by the hon. Member for Saffron Walden (Mr. Haselhurst), at least by implication, when he said that privatisation was not one of the principal reasons of success? The answer goes back to the scepticism to which I have referred about the clash between the interests of the profit-driven operator and the needs and interests of the consumer.

I have about a minute in which to discuss the coal industry, so my remarks will have to be compressed. Coal is an industry with a future and it should be at the heart of energy policy. I do not believe that hard decisions about where we get our fuel and how we price it should be ducked by the Government merely because they have privatised and changed the form of ownership. Will coal be sold as one unit or will it be broken up and packaged? If the latter, will the packages include deep-mine and opencast potential in each package? Will we sell the operations with the reserves attached to them, or will we sell geographical areas with all the unused and unworked reserves in them? Will there be an analogy with the North sea in which the Government hold the reserves and any exploitation will go out to tender? Half a thousand questions could and should be asked.

We are reduced in Scotland to one pit—the Longannet complex—but it is profitable, with a five-year contract with Scottish Power. But Monktonhall and the Frances, and many other parts of Scotland, have possibilities that ought to be explored, too. There is opencast on a massive scale. At Dalquandy, the biggest site, on the borders of Lanarkshire, I am told that the potential is for about 4 million tonnes a year, with a life of 40 years. The Minister will know and doubtless be thinking about the fact that there will be many who will argue that any scheme for disposal should allow a Scottish sale that includes deep mine and opencast elements. There is much to be found out and examined before we get to that point, but I hope that all these matters will be laid on the table before the Bill goes into Committee so that we are not, ludicrously, left having to pass a paving Bill which is in effect a parliamentary blank cheque while we still have no idea of how the Government will deal with the real issues.

The argument is not yet over; it has a long way to go both for coal and rail services. The Government still have to prove their case. I hope that they will be flexible but I take a gloomy view of the prospects of that. I fear that far too many Ministers will not even pay lip service to flexibility. The hon. Member for Southampton, Test (Mr. Hill), who I am sad to say is not in the Chamber now, said that an open mind was needed although, rather endearingly, he conceded that his own was set in concrete.

It is perhaps more sinister that when the Chancellor of the Duchy finally conceded that what was being offered to the railways was not privatisation in the full sense he went on, if I heard him correctly, to say that if this should lead to privatisation, so much the better. That confirms my fears that these proposals are buttressed by prejudice, that they are not well-founded in logic and that they are not in the public interest.

The Government should retreat. I remind them of the words of a well known Conservative rebel on this issue —the hon. Member for Christchurch (Mr. Adley), who described rail privatisation as the poll tax on wheels. And look what happened to the poll tax.

9.43 pm

The Secretary of State for Scotland (Mr. Ian Lang)

Like the hon. Member for Glasgow, Garscadden (Mr. Dewar), I begin by paying tribute to the rich crop of maiden speeches to which the House has been privileged to listen during today's debate.

First, there was my hon. Friend the Member for Croydon, South (Mr. Ottaway), who, as the hon. Member for Garscadden said, is a retread. He follows in the footsteps of Sir William Clark, the distinguished chairman of the Conservative Back-Bench finance committee who is fondly remembered in the House. My hon. Friend brought an international flavour to his review of privatisation—a clear suggestion of a speech written for another day in this debate: indeed, the speech was also a retread. Nevertheless, my hon. Friend made his mark well in a previous incarnation in this place and the House will look forward to hearing from him again.

The hon. Member for Devon, North (Mr. Harvey), as the hon. Member for Garscadden pointed out, has made such a mark that he has already been appointed his party's transport spokesman. He paid a generous and welcome tribute to his predecessor, Tony Speller, and showed a great knowledge of and interest in his constituency.

My hon. Friend the Member for Bury St. Edmunds (Mr. Spring) paid a welcome tribute to Sir Eldon Griffiths and showed great knowledge of the history and present problems of his constituency and the railways. The hon. Member for Sunderland, North (Mr. Etherington) showed a knowlege to the history of Sunderland and mentioned its forgiving nature to absentee MPs, which I am sure he will never be. I hope that the hon. Gentleman is in his place.

The hon. Member for Nottingham, East (Mr. Heppell) spoke with confidence and assurance on local government and privatisation, not always with accuracy, but that can be a matter of opinion. The hon. Member for Sheffield, Hillsborough (Ms. Jackson) spoke about her priorities in education and about deregulation and health and safety issues. The House will soon want to hear from her again.

My hon. Friend the Member for Erewash (Mrs. Knight) made a distinguished speech using references with skill and ability. She showed great knowledge and a grasp of the issues and the geography of her constituency and spoke in particular about the lace industry and local government. The hon. Member for Ceredigion and Pembroke, North (Mr. Dafis) demonstrated a knowledge of the railways and expressed clear views on environmental and constitutional matters. He spoke about harmful emissions of pollutants into the atmosphere and the House looks forward to his next speech.

I regret that I did not hear the only Scottish Back-Bench speech, that of the hon. Member for Midlothian (Mr. Clarke) who made what I am told was an excellent contribution. The House can imagine the enthusiasm with which I look forward to his next speech. I am sure that he will have many more opportunities in the House or in Committee to display his talents. He is the successor to Alex Eadie, a distinguished and much liked and respected figure. I am told that the hon. Gentleman spoke with authority and concern derived from 25 years underground in the coal industry and 16 years in local government.

He specifically asked about two matters which I shall deal with now in case they become lost. He asked about Frances colliery and Monktonhall colliery. As he knows, Frances colliery was closed following a fire during the miners' strike, with the loss of 500 jobs. It is currently maintained on a care-and-maintenance basis and the colliery's future is a matter for British Coal. However, reopening depends on several factors, not least of which is the need to secure a contract for its output. Monktonhall colliery has been on offer for third-party operation since December 1991, and two private sector organisations are interested in securing a contract with British Coal. It is encouraging to note that if Monktonhall colliery has a future, it seems to be in the private sector and not in nationalised management.

My hon. Friend the Member for Castle Point (Dr. Spink) made a fluent and entertaining speech which showed knowledge of his constituency and its needs and enthusiastic support for privatisation. I welcome my hon. Friend's tribute to Sir Bernard Braine, who was the Father of the House and highly regarded by all hon. Members.

The hon. Member for Doncaster, North (Mr. Hughes) spoke ably and interestingly about his constituency and about community care and privatisation. My hon. Friend the Member for Beckenham (Mr. Merchant), like my hon. Friend the Member for Croydon, South, is paying a return visit to the House and this time I hope that he will stay longer. The House welcomed his sound knowledge of his constituency and listened with interest to his views on how rail privatisation might help his constituents.

The hon. Member for Hampstead and Highgate (Ms. Jackson) delivered her maiden speech in the accomplished way that one expects from someone with such a distinguished career already to her credit. We especially remember the great speeches of Queen Elizabeth I that she once delivered. In one of them the Queen dissolved Parliament and bade every Member before leaving for his shire to come and kiss her hand. Who knows where the hon. Lady might end up with an accomplishment of that kind. She also displayed knowledge of her constituency and of housing matters and the House was grateful for her generous tribute to her predecessor, Sir Geoffrey Finsberg. We look forward to hearing her again.

The hon. Member for Sherwood (Mr. Tipping) paid a kind tribute to Andy Stewart, a displaced Scot and now doubly displaced and sadly missed in the House. Like his predecessor, the hon. Gentleman displayed great knowledge of the coal industry, and I am sure that he can be relied on to advance the interests of his constituents.

The hon. Member for Darlington (Mr. Milburn) inevitably spoke about railways. I am sure that the House is grateful for his tribute to Michael Fallon, a former Minister in the Department of Education and Science and, perhaps more significantly, a former Scottish Whip, who is much missed. The hon. Gentleman's fluency and knowledge of his constituency and of his constituents' interests and his clear views on the policies that the Government should be following will have impressed the House.

Finally, the hon. Member for Wallasey (Ms. Eagle) paid generous tribute to her predecessor, my right hon. Friend the Minister for Overseas Development. She also spoke with authority and fluency about her constituency and her priorities in this place.

All the maiden speeches that the House heard today were accomplished, confident and knowledgeable contributions that will enhance the reputation of the House. The House listened with interest and admiration to all of them and will look forward to hearing these speakers again.

The hon. Member for Garscadden tempted me to speak about the Scottish constitutional question, and I could reply at great length on that subject, as we have debated the issues concerned at considerable length. However, at this stage, I shall confine myself simply to saying that the Scottish Conservative party fought the election to this United Kingdom Parliament above all else as a unionist party. We rejected the charlatan potions of all the other parties and, although wipe-out was predicted, in the event we held all our seats and increased our representation in the House by more than one fifth.

We were the only party to increase both the number of seats and our share of the vote. For every three votes that the supposedly omnipotent Labour party secured, we got two. We got twice as many votes as the Liberal Democrats and four times as many seats as the Scottish National party. That clear rallying of support to us, despite the massive combined assault by all the other parties, was confirmed by last week's district council elections, in which our vote went up by one fifth and the number of our seats by one quarter. The Labour party fought the last election on devolution throughout the United Kingdom and was defeated in elections to the United Kingdom's Parliament. Where its case was argued strongest, in Scotland, the swing against it was the largest.

Ms. Hilary Armstrong (Durham, North-West)

Does the Minister know that, in the northern region, the Labour party got more than 50 per cent. of the vote and that the commitment of the northern members of the Labour party was to devolution for the north? That was not a defeat.

Mr. Lang

Like hon. Members on both sides of the House, the hon. Lady stood for election to this United Kingdom Parliament, not to a Parliament for the north-east.

The hon. Member for Garscadden asked me various questions about the consideration of these issues. All that I can say at this stage is that the Government remain willing to consider ways to improve the mechanisms of the government of Scotland, provided that that does not jeopardise the integrity of the United Kingdom and its Parliament. My right hon. Friend the Prime Minister said that the Government were taking stock and that we would report back to the House, and that we shall do in due course.

Mr. Dewar

I shall be brief, as I recognise that the Secretary of State has much to talk about. However, I referred to a report, allegedly authoritative, from Downing street and gave a direct quote from a Downing street source saying that there would be nothing in the next 18 months and no undertakings in the 18 months after that. I am sure that the Secretary of State will recognise that that is a depressing and lengthy timetable. Can he say anything to encourage me?

Mr. Lang

I can give the hon. Gentleman no specific information on timetabling, except to say that the speculation that nothing will happen for 18 months is not accurate.

The issue that primarily occupied the House today was privatisation and, most particularly, privatisation of the rail and coal industries. Many hon. Members spoke about railways, and some had close personal and constituency interests. The Government fully recognise the contribution that an efficient rail network can make towards the country's transport needs, as evidenced by our approval —here I respond to my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) who requested that we ease the grip of Treasury control—of unprecedented levels of investment, which have amounted to more than billion at today's prices since 1979. Investment is now standing at the highest level for 30 years.

Introducing the disciplines and freedoms of the private sector will enable the railways to respond better to users' needs, and that will result in a better service to customers. To those who ask about our detailed proposals, I can respond by saying that the Government will publish a White Paper setting out our proposals as soon as they are ready. We shall continue to provide subsidy for loss-making regional rail services for as long as is necessary.

The arrangements will sustain the present national network of services. The liberalisation of access to the rail network for private sector operation can satisfy the necessary safety and competence standards. It is a positive move towards making the best use of the nation's railways and to seeing more traffic carried by rail. The development whereby Stagecoach Holdings is attaching two coaches for seated passengers on the Aberdeen-London train shows the sort of diversity and creative approach that can so much improve the quality of service to travellers.

Mr. Robert Hughes

During the election, the right hon. Gentleman dropped hints from time to time that we might get the electrification of the east coast main line between Edinburgh and Aberdeen. What are his plans for that? Under the Bill, who would pay for the capital development? Would he be asking Stagecoach to pay a substantial part of the capital development?

Mr. Lang

The hon. Gentleman is mistaken. I made no reference to the electrification of the Aberdeen-Edinburgh line during the election. I am sorry to disappoint the hon. Gentleman. I give him the same reply as that which I have given in the past, which is that it is a matter for British Rail. It has been investigating the matter at great length to ascertain whether the project would be economically viable.

My hon. Friend the Member for Christchurch (Mr. Adley) emphasised the importance of safety standards in the privatisation of the railways. That is something to which the Government attach the highest priority through the railway inspectorate. My hon. Friend asked me about the Dornoch Firth bridge. In general, projects of that kind are matters of judgment for British Rail. It has to decide whether additional investment for such a project could be justified commercially. In this instance both Highland regional council and British Rail have studied the proposition and concluded that public investment could not be justified.

The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) talked about British Rail Engineering Ltd. and the position of employee shareholders. She suggested that those shareholders were being compelled to sell their shares. I understand that that is not the position. ASEA Brown Boveri, having taken over from Trafalgar House shares in BREL, is anxious to increase its holding by acquiring shares that are held by employees, but the employees are not obliged to sell. The unions are advising them not to sell. It is a matter for individual shareholders and not one for the Government.

Mr. William Cash (Stafford)

Will my right hon. Friend give way?

Mr. Lang

I ask my hon. Friend to forgive me for not doing so. He was not present during the earlier part of the debate and I have little time left to me.

My right hon. Friend the Member for Selby (Mr. Alison) and the hon. Members for Sunderland, North and for Midlothian emphasised the importance of safety and suggested that safety considerations in a privatised coal industry would be at risk. There is no reason to believe that there would be any reduction or diminution of safety matters under privatisation. The Health and Safety Commission and its executive would be much involved in safety matters throughout. I readily acknowledge that safety remains a paramount consideration. There is no reason to believe that privatisation would make coal mining any less safe.

I have had little time to reply to the debate, but I want to say a few words about the underlying philosophies of privatisation and nationalisation. It is unsurprising that the Labour party is so preoccupied, especially in Scotland, with constitutional mechanisms. That is partly because, having failed in successive elections to win power through the established democratic processes, it is trying now to change the rules to its advantage. That lack of respect for checks and balances and for parliamentary democracy is recognised and resented by the British people. It is partly, too, because it has an unhealthy preoccupation with the exercise of power. That is based on an excessive belief in the role and functions of government. Nothing more clearly demonstrates that than its sustained addiction—it has been with the party throughout its life, which is now drawing peacefully to a close—to the draining and debilitating cause of nationalisation.

Nationalisation is an economic deformity. It is a dead end. To take over the commanding heights of the economy is at once to reduce them to the quagmire of the economy. Nationalisation cannot succeed, and now it is not only Britain but the rest of the world that know it. Labour's tragedy is a terminal one. However much it pretends that it is no longer wedded to nationalisation, and however much it renounces its creed, it cannot carry conviction because it is not convinced itself.

Clause IV is still there. It is still beating at the heart of socialist philosophy. With almost everything else excised, it is the heart of the socialist philosophy. I was struck by the ringing nature of the endorsement of the hon. Member for Kingston upon Hull, East (Mr. Prescott), when he said that he was quite happy to accept it. The Labour party mouths the phrases of decentralisation, free enterprise, choice, competition and private ownership, but nobody believes it because it does not believe these ideas itself. Its faith is a different one altogether. The Labour party cannot adapt because at its centre is an idea that has gone.

Privatisation is undoing the damage of nationalisation. It is returning the property confiscated by nationalisation. It is releasing a new life force to create wealth. It goes with the grain of human nature, it encourages enterprise, it generates prosperity, it enriches society and it is a force for good. That is why it will endure and why we, who support it, will endure.

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

Debate to be resumed tomorrow.