Commons Sitting of 15 June 1993

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
PRAYERS
  PRIVATE BUSINESS
    CITIBANK INTERNATIONAL BILL [Lords]
    Read a Second time, and committed.
Oral Answers to Questions
  EDUCATION

    Nursery Education
    Mr. Burden: To ask the Secretary of State for Education when he last met the Association of Metropolitan Authorities to discuss the provision of nursery education.
    The Parliamentary Under-Secretary of State for Education (Mr. Robin Squire): No such meeting has been held recently.
    Mr. Burden: May I welcome the Minister to his new appointment? When all the evidence, even from the Government's own tests, suggests that children perform better if they have received a nursery education, is he not ashamed that Britain is still the bottom of the European league in nursery provision? Will not he admit that the Secretary of State's comments about the so-called Mum's Army are actually more about devaluing the skills of those who teach children in those vital early years and avoiding the investment that is necessary in nursery education?
    Mr. Squire: Given the warmth of the first part of the hon. Member's question, I am sorry to disagree so fundamentally with him on the rest. We believe, as we have restated many times, that the very diversity of provision for under-fives remains the best option. It recognises the various needs of children and their parents and makes the best use of what are inevitably limited resources. On the hon. Member's latter point, the recent consultation paper reflects our interests in extending the opportunities for capable people with considerable previous experience of working with young children to train to be early-years teachers.
    Mr. Hawkins: May I warmly welcome my hon. Friend to his new responsibilities? Is it the case that when the last Labour Government left office only some 69 per cent. of under-fives received some form of pre-school provision, and now the figure is more than 90 per cent? Is not that a powerful confirmation of the progress that the Government have made in nursery education?
    Mr. Squire: I am grateful to my hon. Friend, first, for his kind personal comments and secondly for underlining why the subject is so embarrassing for the Labour party. Labour Members say one thing when in opposition, but they invariably do something else when they are in government.
    Mr. Steinberg: Is the Minister aware of the anger among parents and teachers at the proposals for diluting the primary training of teachers? Is he aware that, from an early age and at that early stage, children need professional teachers and not the dilution of the teaching profession? Will he please listen to teachers and parents before he makes a further stupid mistake to add to what the Government have done to education in the past 14 years?
    Mr. Squire: I am sorry that the hon. Gentleman rejects out of hand proposals that are designed to enhance rather than damage. If I may quote from the Yorkshire Post:
    "I think that the professionals should give some thought during the coming weeks to dropping their prejudices and giving people the opportunity to test out the old saying: teachers are born—not made."
    That comment was from a lady who is a graduate teacher and is also a playgroup leader.

    Special Schools (Testing)
    Mr. Fabricant: To ask the Secretary of State for Education what consideration he has given to the testing of pupils in special schools.
    The Parliamentary Under-Secretary of State for Schools (Mr. Eric Forth): Children with special educational needs should follow the national curriculum and participate in its associated assessment arrangements wherever possible, so that they have access to the same education as other pupils. The School Examinations and Assessment Council has given guidance to schools about ways in which the tests for both seven and 14-year-olds might be modified or adapted for those pupils. It is, however, possible where appropriate to disapply the national curriculum and assessment and testing for pupils with special needs.
    I look forward to meeting my hon. Friend and his constituent, Mrs. Anne Hardman, head teacher of Queen's Croft school in Lichfield, to discuss these important issues.
    Mr. Fabricant: I am grateful to my hon. Friend for his helpful answer. However, will he concede that special schools are, by their very nature, special, and so are the children who are taught in them? Will he consider, perhaps at the meeting that we are to have later this month, placing greater emphasis on continual assessment and slightly less emphasis on exam results? But will he continue to press that exam results for all schools, including special schools, should continue to be published for the benefit of parental choice?
    Mr. Forth: I certainly agree with my hon. Friend's last point and I emphasise that, whereas it is important that children in all schools, including special schools, are given the maximum opportunity to enjoy the benefits of the curriculum and regular testing, teachers have a great deal of scope to judge to what extent pupils are appropriate for particular testing. In that regard, I should mention the possibility and potential of the national record of achievement, which can be used at the discretion of schools

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    and teachers to sum up the achievements of pupils of all kinds from all schools when they have completed their education.
    Mr. Spearing: The Minister mentioned the special needs of pupils, some of whom are statemented and some of whom are in special schools, and the need for the adaptation of tests. Does he agree that any reduction in the resources now available to those pupils, whether statemented in ordinary schools or in special schools, will not be approved by Her Majesty's Government?
    Mr. Forth: The hon. Gentleman makes a fair point. It is important that resources throughout education are properly directed to where they can be best and most effectively used and to those with the greatest need. The mechanisms that we now have and, more importantly, those being developed in the Education Bill in another place, go a long way to doing that. I look forward to the support of the hon. Gentleman and his colleagues in developing the thoughts and the mechanisms in the Education Bill which will be of enormous benefit, particularly to pupils with special educational needs.
    Mr. Alexander: But surely it cannot be right to list the results of pupils in special schools without, at the same time, showing that they come from special schools? What incentive can there be for teachers or pupils if they know that they will be lumped in with everyone else without any recognition of pupils' learning disabilities?
    Mr. Forth: My hon. Friend makes an important point to which we have given a great deal of thought. It is important to regard schools of all kinds as being well within the education system within which all pupils should be treated even-handedly and fairly. But we have gone some way, and we shall continue to go as far as we can, towards recognising the special nature of special schools and of units within mainstream schools in order to identify how their results can best be treated and reported so as to reflect fairly their special circumstances. That is our intention and we are prepared to continue to consider the matter and to continue to develop the reporting system in order to make it as fair as possible.
    Mr. Win Griffiths: Given the Minister's last remarks, will not he admit that there is an insuperable problem here because many children in special schools can be categorised as moving towards level one, even at key stage 1, and that what we really need is some guidance from SEAC on how to develop levels of attainment in the period moving towards level one for which at the moment there are no guidelines? Does not the fact that parents want to know how their own children are doing, not necessarily what is happening in the whole school, underline the foolishness of league tables? This would be a good opportunity for the Minister to announce that league tables are out and more sophisticated ways of assessment are in.
    Mr. Forth: There is always a tension between those who ask, as the hon. Gentleman just has, for more sophisticated methods of assessment and those who often complain that the system has become unwieldly and over-bureaucratic. That, among other things, is exactly the problem that Sir Ron Dearing, is considering in his review at the request of my right hon. Friend the Secretary of State. I am conscious of the problem that the hon.
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    Gentleman has outlined, but I believe that the arrangements for key stage 1 and the work leading up to it are broadly satisfactory. It is right that we continue to look at the arrangements to see whether they need be and can be improved, but we must be careful not to throw babies, or pupils, out with the bathwater in our eagerness to provide a more sophisticated approach to cover every category of pupil and, in this case perhaps, every individual pupil. We must keep faith with the principle of testing and ensure its integrity.

    Student Unions
    Mr. Riddick: To ask the Secretary of State for Education what steps he intends to take to reform student unions.
    The Parliamentary Under-Secretary of State for Further and Higher Education (Mr. Tim Boswell): We have already made it clear that we intend to introduce the voluntary principle for student unions. We are currently completing our consultations on the role of campus unions and the National Union of Students, and their use of public funds. In the light of these consultations, we are considering proposals for action which my right hon. Friend the Secretary of State expects to announce very shortly.
    Mr. Riddick: I am sure that my hon. Friend is aware that the vast majority of university students find that they have to belong to a student union, which may do or say some extraordinary things in their name. Should not students have the freedom to decide for themselves whether they wish to belong to a student union? Will my hon. Friend confirm that the Government will take action to give students that freedom of choice?
    Mr. Boswell: Yes, Madam Speaker.
    Mr. Don Foster: Will the Minister convey to his hon. Friend the Member for Hornchurch (Mr. Squire) my congratulations on his first appearance on the Front Bench as an education Minister?
    Does not the Minister agree that the growing problems of student hardship, graduate unemployment and the increased need for welfare services should be a far higher priority for him to tackle in higher education than the partly political—I cannot speak today, Madam Speaker —the party-politically motivated attacks by the Conservative party on individual student unions?
    Mr. Boswell: The hon. Gentleman may not be able to speak today, but he can whinge, and that he has done. I am surprised by what he has said: he gives no credit for our recent publication of the draft further and higher education charters, which are designed to give new rights and an information revolution to students. I am surprised that he did not acknowledge the huge increase in the total amount of student support which has been achieved through the success of the student loan scheme—which has even been acknowledged by The Times. I am also surprised that he did not acknowledge the 46 per cent. increase in student numbers over the past four years.
    Mr. John Marshall: Will my hon. Friend confirm that the system of student support in the United Kingdom is more generous than that of any other country in the European Community? Will he further confirm that since

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    student loans were introduced there has been an increase rather than a decrease in the numbers applying for higher education?
    Madam Speaker: Order. The question relates to student unions, not the support of students.
    Mr. John Marshall: Those who apply for higher education then have a right to join a student union.
    Madam Speaker: Order. I am very tolerant generally, but the hon. Gentleman was out of order.
    Mr. Rooker: Will the Minister confirm that for the overwhelming majority of student unions the amount of public support for their activities is sometimes only one fifth or one sixth of their total expenditure? Will the Minister join me in welcoming the work of student unions in welfare, counselling and job finding? Will he take it from me that, having made nearly 20 visits to universities this year, I found that not one Vice-Chancellor had a bad word to say about the running of the student union in his university?
    Given the obvious stress that many students are under and the many tragedies that we have read and heard about this year, should not this work be better supported? Would not the Minister do better to ignore the bile and spite from the duds on the Conservative Back Benches, and take a positive view and give a firm commitment that the Government will not publish consultation papers during either the recess of the House or that of the universities?
    Mr. Boswell: The hon. Gentleman seems to have got out of bed on the wrong side today. I am surprised at the language he has used. I am equally surprised at his apparent wilful failure to recognise the importance of the principle of voluntary membership, the importance of proper accountability for public funds and, not least, the vital importance of avoiding victimisation of individuals. The hon. Gentleman, in his consultations, may not have heard about some of the things that have taken place in the past. If he has heard about them, I hope that he will not condone them. In return, I will concede one point: we recognise through our consultations the importance of proper services for students, and our proposals, when they are announced, will reflect that fact.
    Mr. Harry Greenway: Will my hon. Friend confirm that a great deal of money could be saved if paid student sabbaticals for officers of student unions were ended and if the presidents of student unions did that job without pay or a sabbatical, as they always used to?
    Mr. Boswell: I recall that in the days when I was a president of my college junior common room I received no remuneration for it. That should essentially be a matter for the student union and the institution. I have heard my hon. Friend's trenchant comments and I can assure him that the voluntary principle will make these matters much more accountable to the student body as a whole.

    Primary Schools (Class Sizes)
    Mr. Byers: To ask the Secretary of State for Education what was the percentage change in the number of primary schoolchildren being taught in classes of more than 40 between 1991 and 1992.
    Mr. Forth: Twenty-four.
    Mr. Byers: Is the Minister concerned that there has been a 24 per cent. increase in just one year in the number of primary school children being taught in classes of more than 40 and that thousands of primary school children are in that position? Will the Minister accept that, at a time of rising primary school population, we will need to employ more teachers to stop things getting even worse? Can he tell the House whether the Chief Secretary to the Treasury is likely to agree to such extra spending? Will he accept that when a teacher stands before a class of 40 10-year-olds, one is talking not about a valuable learning process but crowd control?
    Mr. Forth: The hon. Gentleman is making heavy weather of this. Yes, the figure has gone from rather a few to very few, but we are talking about 225 classes out of 137,000, or 11 pupils out of more than 3·5 million. That gives the House some idea of the proportions. The reality is that most of those classes are not representative even of the schools that reported them. The interesting point is that, at the same time, those schools also have one or more small classes. It must be a matter, rightly, for schools and authorities to decide the distribution of their teaching resources within schools. That is where the decision should be made. I am satisfied that the resources are there for class sizes. The average primary class size now is 26·4 pupils compared with 25·9 as long ago as 1979. It is not a cause for the sort of concern that the hon. Gentleman has expressed.
    Mr. Pawsey: The concern expressed by the hon. Member for Wallsend (Mr. Byers) about children and class sizes would carry more weight if he would join Conservative Members in condemning the irresponsible acts of trade unions in boycotting tests.
    Mr. Forth: That must be the case. We are concerned consistently with achieving and maintaining the highest possible standards in education. I sometimes wonder whether Opposition Members share that concern, given the fact that even now we believe, but we are not sure, that many Opposition Members supported the teachers' boycott. I should be glad to hear that confirmed by the Opposition Front-Bench spokesman today.
    Mr. Jamieson: Is the Minister aware that the implication of an answer that he gave recently to my hon. Friend the Member for Wallsend (Mr. Byers) is that there are 500,000 children in state schools in this country in classes of 41 or more? Has the Minister had time to read an article by David Woodhead, who is a national director of the Independent Schools Information Service? He says—
    Madam Speaker: Order. I cannot allow the hon. Gentleman to quote directly during Question Time.
    Mr. Jamieson: Has the Minister had time to read the article in this magazine—[HON. MEMBERS: "Which one?"] The magazine from the Independent Schools Information Service. Will the Minister note that the article says quite clearly that the size of classes is important for children's education? Is the Minister saying that Mr. Woodhead is wrong or right?
    Mr. Forth: The original premise of the hon. Gentleman's question was wrong; and not yet.

    Grant-maintained Schools
    Dr. Goodson-Wickes: To ask the Secretary of State for Education what assessment has been made of the advice given to head teachers by local education authorities in relation to ballots on grant-maintained status for schools.
    The Secretary of State for Education (Mr. John Patten): I am not aware of any general advice given to head teachers by local education authorities in relation to ballots on self-governing status.
    I am aware, however, that Merton LEA has written to heads, telling them that they owe what is referred to as "a duty of loyalty" to their employer and suggesting that to be seen actively to be in conflict with the policies of their employer would put an employee at risk of breaching that obligation. That is nonsense.
    I deplore action from any quarter that might be construed as intimidating heads, deputy heads or teachers or as muzzling their freedom of expression.
    Dr. Goodson-Wickes: Will my right hon. Friend recognise that there is all the difference in the world between impartial advice issued by local authorities to head teachers and the flagrant political pressure, to which he referred, from Labour councils such as Merton, implying that loyalty to the authority takes precedence over choice for parents and pupils?
    Mr. Patten: The decision whether to go for grant-maintained status is one for governors and parents. It is undoubtedly their choice, not one for the local education authority. I hope that the London borough of Merton will soon join London boroughs such as Wandsworth, Sutton and Hillingdon, half of whose secondary pupils are already being educated in grant-maintained schools. That is the future for Merton and boroughs like it.
    Ms Short: Will the Secretary of State also deplore the actions of teachers organising opt-out ballots who intimidate and pressurise children to get their parents to vote as those teachers require? What view does he take of schools organising opt-out ballots when they have a massive over-provision of places, as in the case of George Dixon school in my constituency which is chosen by very few parents, in order to prevent Birmingham rationalising its over-provision of places?
    Mr. Patten: The way in which Birmingham local education authority treated the head of the school during the ballot to which the hon. Lady referred was absolutely disgraceful. That is why in the Education Bill presently in another place we have moved swiftly to ensure that there is a level playing field so that both sides can put their arguments fairly about whether a school should become grant maintained. More than 900 schools have now voted yes to grant-maintained status, and about 350,000 pupils are already being educated in grant-maintained schools in England as a whole.
    Mr. Dunn: Given that local education authorities controlled by Opposition socialist parties are declaring their hostility to the concept of grant-maintained status, is not it time that we introduced legislation to require schools to opt in to local education authority control instead of opting out?
    Mr. Patten: We have done so in an amendment to the Education Bill. My hon. Friend is a stalwart supporter of grant-maintained schools and he will know that the Bill will ensure that every school in the land shall once a year consider whether to go for grant-maintained status. It is very important that every year governors give parents the opportunity to vote in favour of grant-maintained status.
    Dr. Wright: Would the Minister like to congratulate the parents at the Church of England primary school attended by my children who yesterday discovered that they had succeeded overwhelmingly in rejecting grant-maintained status? Will he further admit that the exercise of balloting in such primary schools is a monstrous waste of time for head teachers, teachers and parents and that it is causing discord and division throughout the school community? Will he now get on with the education tasks in hand?
    Mr. Patten: As I said, some 900 schools have voted yes to grant-maintained status. It is a right of parents to vote in favour. Since the process began, eight out of 10 schools in which ballots are held vote firmly in favour of grant-maintained status.

    Further and Higher Education
    Mr. Jenkin: To ask the Secretary of State for Education what targets the Government have set for the number of students entering further and higher education by the end of the decade.
    Mr. Boswell: The public expenditure plans announced by my right hon. Friend last November assumed that the proportion of young people entering higher education—which is now well over one in four—would remain broadly constant over the next three years. The plans also provided for the number of students in further education to increase by 25 per cent. over the next three years.
    Mr. Jenkin: I am grateful to my hon. Friend for that response. Will he confirm that he intends to ensure that any reduction in tuition fees that a particular institution may suffer will be matched by an increase in the block grant and will he assure the House that he does not intend the process of consolidation in pupil numbers to put undue strain on institutions such as the university of Essex, in my constituency, which have hitherto planned for growth?
    Mr. Boswell: I thank my hon. Friend for his question. He will appreciate that we operate through the funding councils in the several countries of the United Kingdom, but I can confirm that, in making their funding dispositions, those bodies have had regard to the need for stability of the individual institutions. I also confirm that reductions in tuition fees for band 1 students have been exactly matched by an increase in the overall block grant. What is happening represents no more than a reorganisation of the system of payment to deal with the problems where students are taken on at the margin.
    Mr. Bryan Davies: But does the Secretary of State accept that unless there is a change of Government—for which the country hopes and yearns—by the end of the decade, students at that time will be able to look forward to pursuing their courses in poverty in order to train for a life of poverty and unemployment under a Tory Administration, as present students do?
    Mr. Boswell: All that I can say to the hon. Gentleman, who goes back quite a long way, is that he might examine the record of the Labour Government, which he will remember. The fact is that the real amount of money available to the individual student—the total resources —is exactly comparable with what was available when the Government came to power in 1979. Since then, student numbers have risen from one in eight of the population to between one in three and one in four. The hon. Gentleman may want to be an elitist, but I do not. We are offering higher education to a greater proportion of our young people than have ever taken part in it; that will be of great value to the nation and will stand young people in good stead in their future careers.

    Education Reforms
    Mr. Patrick Thompson: To ask the Secretary of State for Education what plans he has to visit schools in Norwich to discuss education reforms.
    Mr. Patten: My ministerial colleagues and I have visited more than 120 schools since taking office.
    I and other Ministers from the Department are continuing our programme of visits to schools across England to hear the views of teachers and governors at first hand and we hope that this programme may include Norwich in due course. It is an oversight that we have not been there yet.
    Mr. Thompson: When my right hon. Friend has the opportunity to visit Norwich, he will find approval for his determination to reform teacher training, a reform which has been long overdue since some of the trendy nostrums of the 1960s and beyond. His emphasis on subject knowledge, on practical skills and on discipline in the classroom must be the right way forward. Does my right hon. Friend also accept the need for particular emphasis on the training of primary school teachers, as their job is in many respects difficult, challenging and possibly undervalued?
    Mr. Patten: I entirely agree with my hon. Friend and I respect his views because, as I remember, he was a classroom teacher for more than 20 years. The reforms proposed for initial primary teacher training in the consultation document issued last week concentrate on a number of important things. The first is the need for less theory and more practice; the second is to ensure that student teachers spend more time concentrating on the basic core subjects; the third is to ensure that they are given much more help in maintaining discipline in the classroom.
    Mrs. Ann Taylor: When the Secretary of State is discussing the so-called reforms in Norwich or elsewhere, will he apologise for his appalling proposals to dilute the professionalism of teachers in our schools by introducing a semi-trained mums' army? That proposal is again uniting parents and teachers against the Government. Does not the Secretary of State recognise the critical importance of education in the early years and the fact that if things go wrong at that stage they may never be put right? Does not the right hon. Gentleman recognise that the highest possible level of professionalism is required for the unique responsibility of introducing our children to formal education? Is he really seeking more confrontation?
    Mr. Patten: That was a laundry list of complaints. With regard to the consultation document, the hon. Lady has overlooked entirely that we wish to bring into the profession a greater diversity of people from a wider range of backgrounds, including parents, who have experience in dealing with and educating young children. Many parents who wish to help with the teaching of five to seven-year-olds have good-quality A-levels and much experience in bringing up children. It is exactly such people that we want to bring into primary teaching.

    Staying-on Rates
    Sir Michael Neubert: To ask the Secretary of State for Education if he will make a statement on staying-on rates at 16 years.
    Mr. Boswell: I greatly welcome the increase in the participation rate of 16-year-olds in schools and colleges —up to 80 per cent. in the current year in England, compared with 56 per cent. in 1979–80. Our expenditure plans for further education will give a further substantial boost to participation, lifting us towards the top of the international league table in staying-on rates for 16 to l9-year-olds within the next three years.
    Sir Michael Neubert: Is my hon. Friend aware that, as a result of this welcome rapid and long-overdue increase in the number of 16-year-olds in Havering staying on at school, the new sixth form college is short of full capacity? In the circumstances, would not it be good sense to allow the grant-maintained Frances Bardsley girls' school in my constituency to keep its sixth form and, at the same time, maintain diversity of parental choice, including the opportunity of single-sex education for girls up to the age of 18?
    Mr. Boswell: I can confirm that all Ministers in my Department are interested in the great themes of diversity, choice and quality in the provision of education in schools and colleges just as much after the age of 16 as before the compulsory leaving age. My hon. Friend will appreciate that I cannot comment on the specific set of proposals concerning the Frances Bardsley school, but I will ensure that these are carefully considered by my right hon. Friend. Of course, any representations made by my hon. Friend, or by any other hon. Member or interested party, will be considered most closely.
    Mr. Tony Lloyd: Is not the sight of the Minister preening himself while firmly burying his head in the ground intriguing? Why does he not address the facts? According to the Audit Commission, between 30 and 40 per cent. of 16-year-olds who entered further education courses this year will not succeed and fewer than two in five of our 18-year-olds are still in education. By any measure, Britain lags behind the rest of the industrialised world. What does the Minister intend to do about it?
    Mr. Boswell: I might start by giving the hon. Gentleman some basic knowledge of anatomy. It would be quite difficult for even the highly skilled team on this Bench to preen themselves while burying their heads in the sand. However, I shall leave aside that minor infelicity and deal with the substance of the hon. Gentleman's remarks.
    My right hon. and hon. Friends and I have said that we are by no means happy with the level of drop-out from further education or other post-16 provision or with the

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    educational standards of those involved in that process. We are very grateful to those, including the adult literacy and basic skills unit, who have helped to expose the deficiencies. We are anxious to repair those deficiencies, just as we are tackling the staying-on rate, to which I have referred. I hope that the hon. Gentleman and his colleagues will support our proposals for the national curriculum and the testing regime, as the deficiencies should be tackled at source and not left to the stage of post-16 provision.
    Mr. Devlin: Is not it the case that, hand in hand with the increased staying-on rate at age 16 goes the 35 per cent. increase in the number of students attaining a first degree in the past 10 years? Is not that a truly tremendous achievement, brought about by the Government and something which deserves praise at every turn?
    Mr. Boswell: My hon. Friend is entirely right; it is a great achievement and deserves praise, although it rarely gets it from the Opposition.

    Grant-maintained Schools
    Mr. Beith: To ask the Secretary of State for Education how many staff in his Department he intends shall be mainly occupied in dealing with grant-maintained schools; and where they will be located.
    Mr. Robin Squire: There are currently 145 Department staff dealing mainly with grant-maintained schools policy, of whom around 95 are based in Darlington and the remainder in London. The total is likely to increase to some 250 to 300, with most of the increase taking place in Darlington and York, before the transfer of certain responsibilities to the Funding Agency for Schools in April 1994. Thereafter, Department for Education staffing will reduce.
    Mr. Beith: But is not what is being built up here—in the Department and then the funding agency—just another bureaucracy, which will be further away from the schools, which is not accountable to the local electorate and which schools have no opportunity to opt back out of? Does the Minister agree that it is not therefore so surprising that the large majority of schools show no sign of wanting to go for grant-maintained status and prefer to stick with the devil they know?
    Mr. Squire: As the right hon. Gentleman has already heard from the Dispatch Box this afternoon, the number of schools applying is nearing 1,000 and we expect that figure to be reached before the end of the year. Let me make it clear to the right hon. Gentleman that grant-maintained schools are self-governing and are not run from Whitehall. More important, those schools, by their very nature, are bringing decisions closer to parents, teachers and local people. I am surprised that a party that used to claim that it was in favour of developing power is now so opposed to the concept.
    Mrs. Lait: Does my hon. Friend agree that some special schools such as George Rainey school in my constituency would benefit from grant-maintained status as set out in the Education Bill that is now in the other place? Will he assure me that staff at the Department for Education and
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    the Funding Agency for Schools will do everything in their power to help those schools to opt out in the difficult circumstances in which they find themselves?
    Mr. Squire: My hon. Friend will understand if I say that all cases will be assessed on their merits. I am certain that most schools in the country would benefit from moving to grant-maintained status, as those that have already done it have found.
    Mrs. Ann Taylor: How many officials in the Department will be involved in allocating budget for grant-maintained schools? Is the Minister aware that one of the consequences of schools opting into centralised control is that some grant-maintained schools still do not know their budget for the current financial year and therefore cannot plan staffing levels of curriculum development? Is not it a sign of the Government's incompetence that grant-maintained schools have to complain to the Labour party that this Government cannot set their budget properly?
    Mr. Squire: The only thing that the House is awaiting from the hon. Lady is a clear statement of her party's attitude to grant-maintained schools. We heard at the last election that she planned to abolish them. It will be interesting to discover whether we have to wait another couple of years to find out whether that will still be Labour's policy at the next election.
    Mr. Bellingham: Is the Minister aware that, in the past few weeks, I have visited a number of grant-maintained schools in my constituency and that all of them pointed out to me the fact that the service that they were receiving from the GM S unit at Darlington was absolutely first-class —that nothing was too much effort for it? Will my hon. Friend ignore the nonsense spoken by the right hon. Member for Berwick-upon-Tweed (Mr. Beith) and pass on our gratitude to his officials?
    Mr. Squire: I am delighted that my hon. Friend found that his schools have had excellent experiences. All hon. Members visiting grant-maintained schools across the country will find that they have a better atmosphere and are enthusiastic. I urge hon. Members who have not yet taken advantage of opportunities to make such visits to do so.

    National Vocational Qualifications
    Mr. Kirkwood: To ask the Secretary of State for Education if he will estimate the number of students accepted for NVQ courses who have withdrawn for financial reasons; and if he will make a statement.
    Mr. Boswell: This information is not collected centrally. However, we have no evidence to suggest that withdrawals are a major problem. NVQs are normally taken by people already in employment and tax relief is available to help meet the cost of course fees.
    Mr. Kirkwood: I am grateful to the Minister for that answer. I am also grateful for the announcement, made yesterday in a written reply, that increased money had been put into access funds for the current financial year. But that answer made it clear that only £4·6 million was being made available for further education access funds. Does the Minister believe, having regard to the downward pressure that central Government are exerting on local

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    authority discretionary education budgets, that that fund of money will be enough to give national vocational qualifications to those qualified enough to have access to courses?
    Mr. Boswell: First, may I make two brief points of qualification relating to the hon. Gentlemans' remarks. The first is that the announcement related to England. The second is that his assertion that the Government are putting downward pressure on the level of money available for discretionary awards is not the case. We continue to fund them. The incidents, effects and current practice of discretionary awards are now being considered by two independent foundations which will report shortly.
    Sir Giles Shaw: Will my right hon. Friend confirm that the NVQ award system is of great importance to employers and local industry and forms a clear relationship between the education system and the craft system of old? Will he ensure that every encouragement is given to NVQ awards in the development of his education policy?
    Mr. Boswell: Yes and yes.

  PRIME MINISTER

    Engagements
    Ql. Mr. Chisholm: To ask the Prime Minister if he will list his official engagements for Tuesday 15 June.
    The Prime Minister (Mr. John Major): This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.
    Mr. Chisholm: What progress did the Prime Minister make at his meeting this morning in rewriting his election manifesto and rewriting the rules on invalidity benefit? In particular, will he say who else he intends to exclude from invalidity benefit, apart from the retired builder with heart disease mentioned in the leaked document? Will he also say why on earth those still receiving it should have to pay, through benefit cuts, for the Government's unsurpassed economic incompetence?
    The Prime Minister: We were not rewriting our manifesto this morning. We were reviewing invalidity benefit and it would be irresponsible of us not to do so.
    Mr. Viggers: I am grateful for the chance of hearing my right hon. Friend's comments. Does he agree that our troops in the former Yugoslavia have done an exceptionally difficult job with great skill and courage and that they have consistently carried out the policy of distributing humanitarian aid for as long as it has been possible for them to do so? Does he further agree that the person to emerge from the recent crisis with the least credibility is the right hon. Member for Yeovil (Mr. Ashdown), who demanded further troop deployments and then immediately demanded that they be pulled out—[Interruption.]
    The Prime Minister: I must first congratulate my hon. Friend on his narrow escape and his capacity to swim. We are delighted to see him here today. He is right to say that British forces are doing an outstanding job in a dangerous situation. They are inevitably running risks as the
    730
    difficulties on the ground become more serious. I wish to ensure that those risks are kept to a minimum and I assure the House that the necessary contingency plans exist should there be a further deterioration in the situation. As my hon. Friend intimated, I believe that the policy that we have followed in Bosnia has been right and any other policy would have been reckless of the lives of British soldiers.
    Mr. John Smith: What changes in the law is the Prime Minister considering with regard to the disclosure of secret donations to political parties, given the continuing scandal over the £1·5 million donated to the Conservative party by Mr. Asil Nadir?
    The Prime Minister: The right hon. and learned Gentleman may occasionally care to comment on some of the people who may in the past have donated money to his party—[interruption.] I have no present proposals for changes in the law.
    Mr. John Smith: Why does the Prime Minister refuse to introduce legislation requiring the public disclosure of all substantial donations made to all political parties, so that the political parties that receive them have to declare them? In addition to putting political contributions on an open and honest basis, would not that also prevent the breaches of company law which occurred in the case of Mr. Nadir, whose companies apparently made seven illegal donations amounting to £440,000 to the Conservative party?
    The Prime Minister: As the right hon. and learned Gentleman knows, the requirement to declare company donations to political parties under the Companies Act falls on the directors of the donor company, not on the recipient. He is wrong in his later comments—the payment itself would not be unlawful. Only the failure to declare it in the company accounts would be unlawful and that is a matter for the company, not the recipient.
    Mr. John Smith: Does not the Prime Minister understand that, if the Conservative party had had to disclose the payment, the breach would have been revealed when the company acted illegally? Does he not realise that he cannot sweep the matter under the carpet and that there are people in the United Kingdom who believe that it is wrong that political parties should be financed in a furtive way or by excessively large donations from those who are not prepared to be publicly identified? Those are the words of concerned members of the Conservative party. Why cannot he act in this matter to get a level playing field that will encourage honesty and equality?
    The Prime Minister: Donations to the Conservative party are freely offered and they are accepted on that basis, unlike the way in which so much is donated to the Labour party.
    Mr. Garnier: Will my right hon. Friend welcome the visit of the President of Azerbaijan later this month and confirm that it underlines the strong diplomatic links between our two countries and confirms the existence of strong commercial links to the mutual benefit of our two countries?
    The Prime Minister: Yes, I certainly share the view expressed by my hon. Friend. There is no doubt that there are huge markets opening up in that part of the world which I believe will be satisfactory for the United

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    Kingdom, provided that we are prepared to take an interest in them at an early stage. Undoubtedly, we are prepared to take that interest and I very much welcome the vist here.
    Mr. Canavan: To ask the Prime Minister if he will list his official engagements for Tuesday 15 June.
    The Prime Minister: I refer the hon. Member to the answer I gave some moments ago.
    Mr. Canavan: What exactly is the Prime Minister going to do now that Lady Thatcher has effectively given him the kiss of death, Asil Nadir is overtaking him in the opinion polls and Sir Bernard Ingham tells us that the Tory party is behaving like a headless chicken? If the party is too chicken to take the necessary steps—[Interruption..]— would not it be more honourable for heads to roll voluntarily and let the people decide on a fresh menu?
    The Prime Minister: More rehearsal needed, I think.
    Mr. Dover: Has the Prime Minister noticed that, during the recession, the private sector has frozen wages and earnings, reduced earnings on many occasions and had massive job reductions? Are not there lessons to be learnt by the public sector, especially if the burden on the private sector is not to continue increasing?
    The Prime Minister: I believe that the private sector has taken dramatic action in order to keep its costs down. The implications of that are now being seen in the extent to which many companies are now recovering. As far as the public sector is concerned, as my hon. Friend knows, we have held strict control over public sector wages over the past year.
    Mr. Hoon: Last week, the right hon. Member for Kingston upon Thames (Mr. Lamont) suggested that the Prime Minister ordered interest rate cuts for purely political reasons against the advice and better judgment of his then Chancellor of the Exchequer. Is that true?
    The Prime Minister: It is not what my right hon. Friend said and it is not so.
    Mr. Jenkin: To ask the Prime Minister if he will list his official engagements for Tuesday 15 June.
    The Prime Minister: I refer my hon. Friend to the answer I gave some moments ago.
    Mr. Jenkin: Will my right hon. Friend confirm that a further 1·8 million people so far have registered an interest in applying for the third British Telecom share flotation? Is not that the clearest evidence possible that, far from running out of steam, the British people cannot get enough popular capitalism?
    The Prime Minister: I believe that my hon. Friend is right about that. Today, almost one in four adults owns shares compared with about one in 20 a decade or so ago. People want to build up a stake in Britain. They want to own a part of it. That is very much part of our philosophy and we will continue to encourage it.
    Mr. Davidson: To ask the Prime Minister if he will list his official engagements for Tuesday 15 June.
    The Prime Minister: I refer the hon. Gentleman to the answer I gave some moments ago.
    Mr. Davidson: Will the Prime Minister accept my delayed but sincere congratulations on his decision to sack his Chancellor of the Exchequer? Will he come to Govan soon, while he is still Prime Minister, and tell the people there that he will sack any Minister who proposes a drastic reduction in the already inadequate level of invalidity benefit?
    The Prime Minister: As I indicated earlier to the hon. Member for Edinburgh, Leith (Mr. Chisholm), we are considering invalidity benefit and I believe that it is entirely right that we should do so. Expenditure on invalidity benefit has risen from about £1·5 billion 10 years ago to more than £6 billion this year. No responsible Government could ignore an increase of that order. We have a duty to consider whether all that taxpayers' money is being wisely spent. The number of people receiving invalidity benefit has more than doubled during the past 10 years from 700,000 to more than 1·5 million. Frankly, it beggars belief that so many more people have suddenly become invalids, especially at a time when the health of the population has improved. I make no apologies for looking at this area of expenditure.
    Mr. Peter Ainsworth: When my right hon. Friend goes to the European Council meeting in Copenhagen, will he take the opportunity to impress on our partners that all of us in Europe operate in an intensely competitive international market and that the costs of bureaucratic regulation, particularly the social chapter, represent a severe disadvantage to Europe's competitiveness in world markets?
    The Prime Minister: Yes, I undertake to raise that matter at the European Council at the weekend. The president of the European Employers Federation recently appealed to Community employment and social affairs Ministers to
    "stop taking measures which unnecessarily destroy jobs".
    I agree with that. I have made it clear in the past. I believe that the social chapter falls into that category and I shall reiterate that view at the European Council meeting this weekend. It is not just a problem for the United Kingdom. All of Europe is facing increasing competition from Japan, the Pacific basin and the United States. Unless all Europe keeps its costs down, we shall not create jobs, but export them.
    Mr. Hanson: To ask the Prime Minister if he will list his official engagements for Tuesday 15 June.
    The Prime Minister: I refer the hon. Gentleman to the answer I gave some moments ago.
    Mr. Hanson: When the Prime Minister visited Wales last week did he have a chance to see the report showing that in the last year of the Labour Government family incomes in Wales were 87 per cent. of those in southern England, whereas in the first year of his premiership those incomes fell to 64 per cent. of those in southern England? Is that a record to be proud of? How, tell me, will the abolition of the wages councils help to improve that situation?
    The Prime Minister: The hon. Gentleman in his litany unexpectedly neglected to mention that in recent years unemployment in his constituency has fallen by 49 per

    733
    cent. That is because of this Government's policies. It will probably fall even further as a result of the abolition of wages councils, which themselves cost jobs.
    Mr. Heald: Will my right hon. Friend confirm that the proposed European Community ban on large engined motor cycles, which would have damaged the British Triumph, has been successfully resisted by the Government? Will he accept the congratulations of motor cyclists throughout the country, including the North Herts Motor Cycle Action Group, on that achievement? Does he agree that that achievement will enable the British Triumph motor cycle to be successful throughout the world, knocking spots off the opposition, something, which my right hon. Friend has done since he became Prime Minister?
    The Prime Minister: I can confirm to my hon. Friend that the Government received a derogation from a Community directive relating to motor cycle engine size. That has had some beneficial effects for the United Kingdom and it means that our industry can continue to sell motor cycles with a large engine in the United
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    Kingdom until at least the start of the next century. That is excellent news for Triumph and British motor cyclists. I am delighted at that outcome.
    Mr. Pope: To ask the Prime Minister if he will list his official engagements for Tuesday 15 June.
    The Prime Minister: I refer the hon. Member to the answer I gave some moments ago.
    Mr. Pope: Does the Prime Minister recall the recommendation last year from the Select Committee on Health that maternity services should be community based and close to a woman's home? How does the Prime Minister square that with the decision to close the maternity unit at the Accrington Victoria hospital in my constituency? He claims to be a listening Prime Minister; when will he listen to the women in my constituency who want their maternity unit kept open?
    The Prime Minister: If the hon. Gentleman wishes to take up his particular constituency point with my right hon. Friend the Secretary of State for Health, I am sure that she would be prepared to listen to him.

Points of Order
3.30 pm
Mr. Peter Hain: On a point of order, Madam Speaker. Do you have any information about an impending statement from the Prime Minister about his answer to me contained in Monday's edition of the Official Report, at column 433, that Downing street office costs have trebled since 1981? What sort of example is that to the old and those on invalidity—
Madam Speaker: Order. The hon. Gentleman must not raise arguments with me. The answer is no, I have not received any such information. That was a most bogus point of order, and I hope that other hon. Members will not follow that example, because the House is getting very weary of such points of order.
Ms Joan Walley: On a point of order, Madam Speaker. Given that the Department of Transport has today published its plan for the first private toll road, the northern Birmingham relief road, will you make inquiries about the circumstances under which the environmental assessment, which goes with the statement of plans, could be placed in the Library of the House so that hon. Members could have an opportunity to take on board the environmental considerations, which are most important?
Madam Speaker: I think that the hon. Lady might take that up with the Department herself.
Mr. Tony Banks: On a point of order, Madam Speaker. I suspect that this is a genuine point of order. Will you please rule that, when the hon. Member for Harrow, West (Mr. Hughes) is standing to your right, with his back up against the Box where the civil servants sit, he should not participate in the debate by
736
haranguing and shouting at Members on the Front Bench or anyone else in the House, since he is outside the confines of the House and, as a Government Whip, he should, of course, not say anything?
Madam Speaker: That is almost a genuine point of order, because I find that many hon. Members, who are outside the confines of the Chamber, are also doing a lot of shouting when Front Bench spokesmen are at the Dispatch Box. I hope that that will cease from now.

Statutory Instruments, &c.
Madam Speaker: With permission, I shall put together the motions relating to statutory instruments.
Motion made, and Question put forthwith pursuant to Standing Order No. 101(3) (Standing Committees on Statutory Instruments, &c.).

PARALYTIC SHELLFISH POISONING
That the Food Protection (Emergency Prohibitions) (Paralytic Shellfish Poisoning) (No. 3) Order 1993 (S.I., 1993, No. 1476) be referred to a Standing Committee on Statutory Instruments, &c.
That the Food Protection (Emergency Prohibitions) (Paralytic Shellfish Poisoning) (No. 4) Order 1993 (S.I., 1993, No. 1483) be referred to a Standing Committee on Statutory Instruments, &c.

DRUG TRAFFICKING (PROCEEDS)
That the draft Confiscation of the Proceeds of Drug Trafficking (Designated Countries and Territories) (Scotland) Amendment Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.

OVERSEAS FORFEITURE ORDERS
That the draft Criminal Justice (International Co-operation) Act 1990 (Enforcement of Overseas Forfeiture Orders) (Scotland) Amendment Order 1993 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Wood.]
Question agreed to.

National Health Services (Amendment)
3.33 pm
Mr. Mike Hall: I beg to move,
That leave be given to bring in a Bill to make further provision as to the functions of Family Health Services Authorities in relation to the rights of general practitioners' patients; and to amend section 20 of and Schedule 7 to the National Health Service Act 1977 to ensure that such patients are consulted by Family Health Services Authorities when substantial variations are proposed to their medical services.
The need for the Bill arose because of recent events that took place on the Windmill Hill estate in the Runcorn part of my constituency. Those events demonstrate the ineffectiveness of both the Department of Health and the patients charter to protect the interests of the general public.
On 29 April 1993, the doctor's surgery that serves the Windmill Hill estate district of my constituency was closed, and 703 patients of Dr. O'Connor were given only five days' notice of the decision. They were confronted by the news that they had only five days to find another general practitioner.
A number of my constituents in that district are elderly, a number of them are disabled and some of them are both. The district contains many families with young children who live on the estate. The decision to close the local doctor's surgery meant that they would now have to travel even further to the nearest general practitioner.
It will be a difficult journey for a number of my constituents, for a number of reasons. First, there is an inadequate bus service to the next doctor's surgery, and many of my constituents are not car owners, which means that they will have to walk the two miles to the doctor's surgery through open park land, which, when the climate is bad, will mean a difficult journey. It will mean that, every time that those constituents need to see a general practitioner, they will have to make the journey on foot to and from their doctor's surgery.
The provision of locally based general practitioners and their surgeries is a fundamental and essential part of proper care in the community. Indeed, it is probably the starting point of care in the community, but my constituents have had the facilities at that starting point removed. My constituents' reaction to the decision was one of anger that they had not even been consulted by the family health services authority. They were anxious that the provision of services to them was to be removed, and they were concerned that the level of health service provision in that part of Runcorn would be diminished.
It is the role of the family health services authority to consult on such issues, but it did not consult my constituents. It did not even give them warning that the decision was on the way. It simply sent them a curt circular letter telling them to find themselves another general practitioner within five days. It gave a list of the surgeries which my constituents could use. My constituents were not asked whether or why—they were not consulted, but were told what they would have to do. The decision had an immediate impact on the services of the local hospital.
A number of my constituents said that they were unable to find a doctor's surgery within five days and that if something was wrong with them they would go to Halton general hospital for their medical needs. I was confronted
738
by my constituents on the day that the decision was taken and I promised them that I would raise the matter in the House of Commons in any way I could.
I raised the issue during business questions, and asked for a statement, but was told that, as I had informed the Department of Health that day, I would be receiving a letter. I tried unsuccessfully to catch your eye, Madam Speaker, at Health questions, but was unable to do so. I now have the opportunity of the ten-minute Bill procedure to raise the issue on the Floor of the House.
When I realised that my constituents had been presented with a fait accompli, I was not sure what to do, as I had already raised the issue with the Department of Health. I turned to that champion of citizens' rights, the citizens charter, published in July 1991. Page 5 states:
"The public sector should provide choice wherever practicable. The people affected by services should be consulted. Their views about the services they use should be sought regularly and systematically to inform decisions about what services should be provided".
Page 10 of the document states:
"Health Authorities must seek local citizens' views on their services."
I also looked at the patients charter, as I thought that it might provide back-up and further instructions from the Government. In the foreword to the patients charter, the then Secretary of State for Health wrote:
"The Government is also firmly committed to improving the Service—to creating a better National Health Service. This means a Service that:
—always puts the patient first, providing services that meet clearly defined national and local standards, in ways that are responsive to people's views and needs."
I was encouraged by those words, which seemed to give me hope that the views of my constituents on the Windmill Hill estate, who had not then been consulted about the removal of their medical services, would be entitled to have their voices heard.
The Government's commitment in the citizens charter and the patients charter led me to contact the Department of Health to seek its intervention, even at such a late stage, to ensure that my constituents were provided with the adequate medical facilities that they wanted in their locality. It was their view that the surgery should stay open, and that view was in line with the views expressed in the citizens charter and with the supposed rights contained therein.
Unfortunately, I need to present the Bill because the response by the Department of Health was less than adequate. I was advised in writing by the Secretary of State
for Health that the legal position on matters of this kind is that the Cheshire family health services authority should consult the Halton community health council about the proposed closure of the doctor's surgery on Windmill hill.
The Minister further advised me that the decision about whether to replace the outgoing doctor rested with the medical practices committee, which is an independent public body. The Minister stated that that committee bases its decisions on reports from the family health services authority, following its consultation with the community health council. The letter stated:
"The decision of whether to dispense or advertise a vacancy is a matter entirely for the Medical Practices Committee and is not subject to Ministerial intervention."
The Minister said that the Cheshire family health services authority had been consulted about the closure of the doctor's surgery on Windmill hill, and that the legal procedures had been followed. That means that the hopes

739
and aspirations contained in the citizens charter, which were said to be at the heart of Government policy in the 1990s, have not materialised, and that the views of my constituents have been totally ignored.
In terms of the National Health Service Act 1977, the promises in the citizens charter and the patients charter to consult people affected by services counts for nothing. Even if the Government wanted to act in this case, they would be prevented from doing so by current legislation. If that legislation remains unamended, the citizens charter and the patients charter are merely expensive paper tigers. They will remain a political gesture which, when put to the test, will be shown to have no teeth and no means of effecting the change that they desire.
That is another example of the Government failing to deliver their promises to the people and of people being misled into believing that the citizens charter is something that it is not.
The matter that I raise is not an isolated incident, because doctors' surgeries are being closed throughout constituencies. My hon. Friend the Member for Walthamstow (Mr. Gerrard) raised the problem 12 months ago in the House. He was told the legal position, which means that the citizens charter counts for nothing in such cases.
In the light of such events, the 1977 Act needs to be changed. My constituents in Windmill hill deserve to have their views heard, and they are entitled to the minimum consultation about their family needs for health service provision in Runcorn.
Question put and agreed to.
Bill ordered to be brought in by Mr. Mike Hall, Mr. Neil Gerrard, Ms Ann Coffey, Mr. Colin Pickthall, Ms Estelle Morris, Mr. Jim Dowd, Mrs. Bridget Prentice, Mr. David Hanson, Mr. John Heppell, Mr. Greg Pope, Mr. Doug Hoyle and Ms Janet Anderson.

NATIONAL HEALTH SERVICES (AMENDMENT)
Mr. Mike Hall accordingly presented a Bill to make further provision as to the functions of Family Health Services Authorities in relation to the rights of general practitioners' patients; and to amend section 20 of and Schedule 7 to the National Health Service Act 1977 to ensure that such patients are consulted by Family Health Services Authorities when substantial variations are proposed to their medical services; And the same was read the First time; and ordered to be read a second time upon Friday 2 July, and to be printed. [Bill 203.]
Orders of the Day

  Trade Union Reform and Employment Rights Bill
  Lords amendments considered.
  Lords amendments Nos. 1 to 7 agreed to.

  Trade Union Reform and Employment Rights Bill

    New Clause
    ACTION SHORT OF DISMISSAL: NON-INFRINGING ACTIONS
    Lords amendment: No. 8, before clause 13, to insert the following new Clause—
    (". In section 148 of the 1992 Act (consideration of complaint of action short of dismissal), after subsection (2) there shall be inserted—
    "(3) In determining what was the purpose for which action was taken by the employer against the complainant in a case where—

    (a) there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees, and

    (b) there is also evidence that his purpose was one falling within section 146,

    the tribunal shall regard the purpose mentioned in paragraph (a) (and not the purpose mentioned in paragraph (b) as the purpose for which the employer took the action, unless it considers that the action was such as no reasonable employer would take having regard to the purpose mentioned in paragraph (a).
    (4) Where the action which the tribunal determines to have been the action taken against the complainant was action taken in consequence of previous action by the employer paragraph (a) of subsection (3) is satisfied if the purpose mentioned in that paragraph was the purpose of the previous action.
    (5) In subsection (3) "class", in relation to an employer and his employees, means those employed at a particular place of work, those employees of a particular grade, category or description or those of a particular grade, category or description employed at a particular place of work.".")
    3.45 pm
    The Secretary of State for Employment (Mr. David Hunt): I beg to move, That this House doth agree with the Lords in the said amendment.
    I shall commence by making two important points. First, I shall explain how the amendment will restore to the law the meaning that it was intended to have before two recent Court of Appeal cases. Secondly, I strongly reaffirm that the law must protect all employees from any action by their employer that is designed to force them to give up membership of, or to join, a trade union. Against the background of those two important points I shall seek to put the record straight, in the light of some recent comments, which were based on a number of misconceptions.
    During the debate, it is important for all hon. Members to differentiate between the right to belong to a trade union and that of collective bargaining. Trade union membership must not be confused with the law and practice relating to collective bargaining, and I hope to explain why.
    Amendment No. 8 concerns the law on action short of dismissal, which is contained in section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992, but dates back to the legislation of a previous Labour Government, and that aspect of the law has not been changed since 1975.

    741
    Section 146 protects employees against action by their employer that is intended to deter or compel the employee either to become or to cease to be a trade union member. That is why I stressed at the outset that the Government believe that the decision whether to be a member of a trade union must be a matter of free choice for the employee. Once again, I reiterate that employees ought to be protected against any action by their employer that is designed to force them either to be, or not to be, union members.
    Mr. Richard Burden: I am grateful to the Secretary of State for giving way, and wonder how he feels about having this as his first job. Does his logic apply to Government Communications Headquarters, Cheltenham and if not, why not?
    Mr. Hunt: I am delighted to have this as my first job, because I am explaining why that principle lies at the heart of the Government's stance on trade union legislation. Indeed, an examination of the Government's step-by-step approach, which has been so successful in transforming industrial relations, reveals that that principle has consistently lain at the heart of the Government's legislation, and I am happy to reaffirm it. Government Communications Headquarters, Cheltenham is a very different set of circumstances. The greatest challenge is for the Labour party to give that principle the same unequivocal support.
    Mr. Dennis Skinner: Why does the Minister, who claims to be a Tory wet, not have the guts to admit that the Government are all about allowing people to be members of a trade union but not to be effective members, so that they are unable to join with others to negotiate with employers? The truth is that the Government rattle on about a classless society, but they are going to give the bosses a chance to deduct wages from people who are members of a trade union, while the blue-eyed boys and girls will get more money. The whole thing stinks to high heaven.
    Mr. Hunt: I am not prepared to join the hon. Gentleman in his own individual class war. Those days are fast and far behind us. What he looks back to are, in his words, the good old days; in my words, they are the bad old days of the 1960s and 1970s, when a few trade union leaders could dictate to the Government and we had the worst industrial relations record of any country in the world. The Government have transformed that bad industrial relations record into one in which everyone in the country can take pride. I am determined to stay wedded to the principles which brought that about.
    Mr. Alex Carlile: Will the right hon. Gentleman answer the underlying point that has just been raised by the hon. Member for Bolsover (Mr. Skinner)? Is he not proposing a restriction of the exercise of the right of which he has just spoken—the right to be a member of a trade union? Will he explain to the House how it is not a breach of article 11 of the European convention on human rights to introduce that proposal?
    Mr. Hunt: It is an interesting dimension to have Bolsover interpreted by Montgomeryshire. I do not think that the hon. Member for Bolsover (Mr. Skinner) needs any lessons from the hon. and learned Member for Montgomery (Mr. Carlile) on how to put his points.
    Mr. Carlile: Answer the question.
    Mr. Hunt: I shall come to his question, but I do not think that the hon. Member for Bolsover needs any lessons from those on the Bench behind him. In my experience in the House, the hon. Member for Bolsover has given many lessons back the other way to those on that Bench.
    The hon. and learned Member for Montgomery has once again confused the two issues that I tried to caution the House not to confuse right at the outset—the principle of collective bargaining and the issue whether an individual has the right to belong to a trade union. If one can separate those two issues—[Interruption.] Will the hon. Gentleman allow me to respond to his point, instead of trying to be a barrack-room Commons lawyer, which he does not do very well?
    It is very important not to confuse the issue of collective bargaining with that of trade union membership. That is why I can answer so vehemently the hon. and learned Gentleman's latter point. We are respecting the right of an individual to belong to a trade union of his or her choice and the right not to belong to a trade union.
    Ms Dawn Primarolo: The Secretary of State may be aware that, in my constituency, an employer called Arrowsmith issued new contracts to its work force, all of whom were members of a trade union. The contract specifically required that they were not to be members of a trade union. When they refused to give up their trade union membership, the employer sacked all 120 of them. Will the Secretary of State suggest what action they should take against an employer who is breaching the principle that he said he adheres to—the right to choose to be a member of a trade union?
    Mr. Hunt: Any action taken by an employer which is designed to force an individual employee not to join a trade union or to give up trade union membership is contrary to section 146. I am happy to look at all the details of the contracts, but I think that the hon. Lady must be mistaken in two important respects. She must not confuse the question of collective bargaining, but it has always been possible for employers, under the law as it stood—
    Several hon. Members rose—
    Sir Michael Neubert: Does my right hon. Friend agree that the problem is that those self-same unions that he mentioned in reply to the hon. Member for Bolsover, which disrupted and undermined good industrial relations back in the 1960s and 1970s, are still the essential support and financial prop of the Labour party today, which may account for them wanting to take all the day on this one issue?
    Mr. Hunt: I gave way to my hon. Friend because I knew that he would make a good point, and he did not neglect to do so.
    As I have explained on many occasions to many trade union colleagues of mine both now and in the past, it is important that the British trade union movement should give up its stranglehold on the Labour party. It undermines its case in industrial logic for seeking to cling on to its power over the Labour party.
    It is important to recall that, as my hon. Friend's point bears out, it was not that long ago that Mr. John Edmonds, the leader of the GM B—Opposition Members

    743
    may well shift uneasily in their seats when I remind them of this—said, "We pay for the Labour party, so we have a right to democracy in the Labour party." That point made by my hon. Friend is important. If the Labour party wishes to escape from the accusation—
    Several hon. Members rose—
    Mr. Hunt: I am answering the point. It may be embarrassing to hon. Members, but I am answering the point made by my hon. Friend.
    If the Labour party wishes to escape from the accusation that it is a fully paid-up subsidiary of the trade union movement, it must take steps on this point.
    Mr. George Howarth: On a point of order, Madam Speaker. Will you rule whether a discussion on links between the Labour party and the trade union movement has anything to do with the amendment?
    Madam Speaker: A number of hon. Members who are questioning the Secretary of State are leading him down that road. If that is the case, he must reply. I am sure that we shall soon return to the amendment, so that other hon. Members who wish to speak will be able to do so.
    Mr. Hunt: I feel strongly that it is time that the trade union movement gave up shouting that he who pays the piper calls the tune. [Interruption.] I know that it is uncomfortable, but I make this point. Mr. John Edmonds let the rat out of the bag. What he said is the true state of affairs in the nation today. Opposition Members are indeed spokesmen, spokespeople, spokespersons and spokes for the trade union movement. It is about time that they started to represent the real interests of union members rather than some trade union leaders.
    Mr. Ron Leighton: Will the right hon. Gentleman give way?
    Mr. Hunt: Of course I shall give way to the hon. Gentleman, then I shall return to the point made by the hon. Member for Bolsover.
    Mr. Leighton: I know that this must be embarrassing for the Secretary of State, but will he please return to the point under discussion and not waffle round all these other matters? Let me try to clarify what he has said. Has he not said that he does not mind a worker holding a trade union card privately, but if that worker wants to use the facilities or good offices of the union—for example, by getting the branch secretary to write to his employer about wages or conditions—that worker can be penalised? Is that not the essence of the matter?
    Mr. Hunt: I was trying to explain that that is not the case. For many years, I was a solicitor acting for a number of trade unions and for one in particular. I became aware of the importance of the trade union movement in areas other than collective bargaining. It has never been part of the trade union case that, without collective bargaining, there is no such thing as a trade union movment. The hon. Gentleman is confusing those two issues, which I pleaded with the House not to confuse in order to avoid a disjointed debate.
    Mr. Ronnie Campbell: What is the difference between Lords amendment No. 8 and the Union
    744
    of Democratic Mineworkers receiving a bigger wage increase than the National Union of Mineworkers a few years ago, which we had to go to court to stop?
    Mr. Hunt: I am making a point relating to union membership. It has always been possible for an employer to give an employee an incentive to engage in individual contracts rather than to negotiate through collective bargaining. The amendment seeks to take the law back to where people believed it was before the Court of Appeal cases. It is perfectly in order for an employer to negotiate directly with individual employees and to offer them an additional pay increase if they will negotiate on an individual basis. I can produce a number of comments made by Labour Ministers which clearly show that this provision was never intended to affect collective bargaining, which is the issue before us today.
    I emphasise that the cases that have made the amendment necessary do not concern union membership: they arise as a result of employers wanting to change the methods by which they negotiate their employees' pay. It has always been generally understood and accepted that the statutory provisions with which we are concerned do not extend beyond issues of union membership, and certainly were not intended to cover collective bargaining.
    4 pm
    Ms Angela Eagle: I welcome the Secretary of State to the Dispatch Box and congratulate him on his appointment. As to the distinction that he appears to be drawing between membership of a trade union and actually using the good offices of that trade union, the employment appeal tribunal, under Mr. Justice Knox, considered this question and rejected it with the following words:
    "We find ourselves unconvinced of that distinction. In our judgement, the activities of a Trade Union officer in negotiating and elucidating terms of employment is, to use a prayer book expression, the outward and visible manifestation of Trade Union membership … and we see no genuine distinction between membership of a Union on the one hand and making use of essential services of a Union on the other." Would the Secretary of State care to comment on that?
    Mr. Hunt: I am grateful to the hon. Lady for her kind words in welcoming me to the Dispatch Box.
    The words that I would add are "not collective bargaining issues". I have already referred to this. In a debate in the other place on 23 September 1975, Lord Jacques, who was then a member of the Labour Government, when dealing with clause 45—which is now essentially clause 146—said:
    "Clause 45 deals with individual rights of employees, not collective bargaining issues."
    It is important that we should bear that difference in mind. It is clear that it was the intention of the Labour Government in 1975, in introducing the provision, that the clause should deal with individual rights of employees and in circumstances with collective bargaining issues.
    Lord Jacques went on to explain:
    "A prohibited action must be for the purpose of prevention, deterrence or penalisation. Actions aimed at other purposes, such as helping recognised unions, which have the incidental effect of restricting some employees' rights comparatively, do not infringe these rights."
    Nothing could be clearer. It was on the basis of that understanding of the law that two separate companies,

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    Associated Newspapers and Associated British Ports, acted when they decided to change their negotiating arrangements.
    Mr. Frank Dobson: Will the right hon. Gentleman confirm that, when it came to the meat of the matter, Lord Jacques, for the Labour party, in the same debate said:
    "The clause provides, negatively, that the employer must show tolerance and not prevent participation in union activities"?
    On behalf of the right hon. Gentleman's party. Lord Gowrie—who some time later gave up being a Minister in the House of Lords because he could not get by on £33,000 a year—said:
    "In dealing with individual rights, we were anxious that negative rights—the right not to be forced into doing things —should be part of such laws."
    Lord Jacques said the alternative to passing the measure would mean that
    "The individual employee has no rights to take part in any of his union's activities at work".—[Official Report, House of Lords. 23 September 1975; Vol. 364, c. 189–92.]
    But this clause was passed, and they are so entitled.
    Mr. Hunt: I shall savour this, as it may be the only occasion on which I agree with every word that the hon. Gentleman has said. I have those quotations at my disposal as well, because they prove my point, which is that this clause does not concern collective bargaining issues. Anybody who knows anything about trade union membership will know that many other benefits of such membership exist side by side with, but separate from, collective bargaining issues. That is an important point to make.
    Another debate in the other place on 28 July 1982 again expresses the point that I am seeking to make. Earl Ferrers said:
    "it would not be unfair to have a differentiation between rates of pay".
    If one looks at the context in which he said that, one will see that the situation about which we are now talking has been thrown into considerable doubt by the two Court of Appeal cases.
    When the companies that I have mentioned decided to change from collective bargaining to personal contracts and to reward those employees who agreed to accept personal contracts, they had every reason to believe that they were acting lawfully. They have made it clear throughout that they were in no way seeking to prevent their employees from remaining union members. Had they done so, they would have been acting unlawfully. That was never the purpose or the effect of the action that they took.
    Mr. Dobson: The right hon. Gentleman referred to the 1982 debate involving Earl Ferrers. Will he confirm that, at the end of the paragraph from which he quoted, Earl Ferrers went on to say—it is the reverse of this situation, but we can assume that it applies both ways—
    "What would be unfair would be to say, 'We shall negotiate a wage increase for union members and union members will have a wage increase, but meanwhile non-union employees will have no increase.'"
    It appears from that debate that Earl Ferrers did not know whether he was talking out of his hat or his elbow.
    Mr. Hunt: I was quoting from the end of the paragraph. The hon. Gentleman said that he was quoting from the end of the paragraph, but he did not. That is a matter of detail. The quotation used by the hon. Gentleman continues:
    746
    "However, it would not be unfair to have differentiation between the two."
    The end of the next paragraph says:
    "That would be unfair, but it would not be unfair to have a differentiation between rates of pay, provided that they are consistent."—[Official Report, House of Lords, 28 July 1982; Vol. 434, c. 331.]
    It is simple to understand, but the hon. Member for Holborn and St. Pancras (Mr. Dobson) obviously has some difficulty with it.
    I shall explain in another way. Cases were brought against the two companies in question under what is now section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992. In each case, the industrial tribunal found that the employer had contravened section 146, but in each case that finding was reversed by the employment appeal tribunal. The latter's rulings were fully in line with what had been generally accepted as the intention of the section and were in line with the words of the Labour spokesman—which I have already quoted—in 1975.
    Mr. Eric Martlew: Will the right hon. Gentleman give way on that point?
    Mr. Hunt: I am still dealing with the point raised by the hon. Member for Holborn and St. Pancras.
    On 30 April, the Court of Appeal reversed the decision of' the employment appeal tribunal and ruled that the employers had acted unlawfully in both cases. As a result, it is clear that section 146 can be interpreted in ways that go far wider than was ever intended when Parliament originally adopted this provision in 1975. When the law has become so confused on such a fundamental matter, the case for amending the statute is overwhelmingly persuasive.
    Mr. Peter Bottomley: I join other hon. Members in welcoming my right hon. Friend to his new position, but I wish that his first debate was not on such a subject.
    The Court of Appeal said that the employment appeal tribunal was wrong to find any complication in the law. The Court of Appeal made it very plain that the industrial tribunal had been right to rule that the employers had acted unlawfully. There was nothing in the Court of Appeal judgement to suggest that there is any need for clarification or that the industrial tribunal ruling had changed the law. Having heard my right hon. Friend's speech, and bearing in mind what I call section 23(1)(a) of the Employment Protection (Consolidation) Act 1978 but which my right hon. Friend will call by its updated consolidation number, the House will want to consider whether the industrial tribunal ruling did in fact change the law from what it was held to be by most employers, all trade unions and people who have been industrial relations and personnel specialists for decades.
    Mr. Hunt: I thank my hon. Friend for welcoming me to the Dispatch Box in my new position.
    I have thought very long and hard about this aspect of the law. I am convinced that the Government's proposal and the Ullswater amendment in another place are absolutely right, and will do much to make the position as clear as it was before the Court of Appeal judgment. I ask my hon. Friend to reflect for a moment, because I believe that he is referring mainly to what are findings of fact by the tribunal.

    747
    I in no way seek to diminish the tribunal's ability to reach findings of fact and to do so robustly, but I am seeking to return the law to where I believe it was generally believed to be before the Court of Appeal interpreted the law in a way in which I, those in another place, and I hope this House believe brought confusion to a matter which had previously been very clear indeed.
    Mr. Derek Enright: Does not the right hon. Gentleman recall that the judgment was announced on 30 April but that the Government announced that they were going to introduce amendments before the full transcript was available? In panic, at a very late stage, they subsequently included the amendment, which I do not believe will stand up in court because it is so incoherent. Is it not a fact that the Government's friends were found guilty, and that the price of support for the Prime Minister was to table the amendment?
    Mr. Hunt: The hon. Gentleman does nothing to assist his case by fogging the issue with such emotive phraseology. I strongly believe that, if one dispassionately considers the law as it is after the Court of Appeal judgment—it was, of course, necessary for the Government to move swiftly, because the Bill was in another place, and it was the final opportunity to make—
    Mr. Martlew rose—
    Mr. Hunt: May I finish my response?
    As it was the final opportunity to make changes, one will see that the law needed clarification. That is what we are putting to the House this afternoon, and what my noble Friend Viscount Ullswater proposed in another place.
    Mr. Martlew: Does the Secretary of State think it right that an employer should pay an employee more because the employee decides to give up his trade union rights?
    Mr. Hunt: That, as I have explained, is contrary to the law.
    Mr. Tim Devlin: I am very interested in what my right hon. Friend is saying, but will he clarify one point? Is it his contention that, prior to the three cases being brought, it was legal to discriminate between employees who were in a union and those who were not? What was his understanding of the law before those cases were brought?
    Mr. Hunt: As I have already said, it is contrary to section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992 for an employer to make it conditional on membership or non-membership of a trade union—trade union membership is the important point, and I am not talking about collective bargaining—[Interruption.] I understand that the hon. Member for Bolsover believes strongly that, without collective bargaining, it is impossible to have properly effective trade union rights, but that is an individual rule—
    Mr. Skinner: Then membership means nothing.
    Mr. Hunt: And membership means nothing. However, that is his individual view but, as I shall now explain to my hon. Friend the Member for Stockton, South (Mr.
    748
    Devlin), not the law prior to the two Court of Appeal decisions. The hon. Gentleman knows that, because he has argued against Government proposals many times, saying that they drew the teeth of the trade union movement. It is possible for an employer to derecognise a trade union.
    In response to my hon. Friend the Member for Stockton, South. I must say that it is perfectly possible for an employer to offer a pay inducement or an additional pay rise to an employee who chooses to make an individual contract with the employer rather than through the collective bargaining processes. To return to the direct point that my hon. Friend made, it is still perfectly possible for that individual member to remain a trade union member and still benefit from that pay rise. The pay rise and the inducement must not be conditional upon membership or non-membership of a trade union.
    That will do a great deal to reassure my hon. Friend because there has been an enormous amount of distortion outside the House. I hope that we can now return to the debate, which is about trade union membership—that is the subject of the amendment—and collective bargaining, which must be viewed separately.
    Mr. Harry Barnes rose—
    Mr. Alex Carlile rose—
    4.15 pm
    Mr. Hunt: May I continue with what I was saying about the two cases? Then I shall, of course, give way again.
    On 30 April, the Court of Appeal reversed the decision of the employment appeal tribunal and ruled that the employers had acted unlawfully in both cases. I have explained that, when the law has become so confused on so fundamental a matter, the case for amending the statute is overwhelmingly persuasive.
    The section was intended to prevent employers from victimising individual employees on the ground that they were or were not trade union members. It was not intended to apply where an employer changes arrangements, such as pay negotiating arrangements, for organisational or business purposes. The fact that section 146 has now been interpreted as having a wider meaning shows that the law is unclear, and is no longer achieving the purpose for which it was intended. I have read out in the Chamber the words of Lord Jacques—
    Mr. Alex Carlile rose—
    Mr. Hunt: Let me finish my point.
    If the section is no longer achieving the purpose for which it was intended, it is necessary—indeed, I contend that it is imperative—that the amendment be made.
    The amendment clarifies for the benefit of tribunals and courts the way in which an employer's purpose should be determined in cases such as those that have occurred recently. It provides for the situation in which a case comes to a tribunal and, as happened in the cases in question, the employer and the individual put different arguments about the employer's purpose in taking a particular action.
    Let me explain to my hon. Friend the Member for Eltham (Mr. Bottomley) what will happen before the tribunal. The tribunal will consider the evidence that both parties bring before it, and will determine whether that evidence is credible. Then it will decide the case on the basis of that evidence. When credible evidence is brought forward, on the one hand that the employer's purpose was

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    to bring about a change in the way in which he conducted his relationship with his employees, or with a class of them, and on the other hand that his purpose was one falling within section 146, the tribunal is to take the bargaining purpose as the relevant purpose.
    That is not to say that any tribunal's hands are to be tied. The tribunal must always have regard to the reasonableness of the action taken. If the action is such as no reasonable employer would take in the circumstances, the tribunal will still be able to decide that the action amounts to action short of dismissal, in the terms of section 146.
    Mr. Andrew Miller rose—
    Mr. Hunt: I shall give way in a moment.
    The amendment will restore the proper distinction, drawn in section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992, between individual matters and collective matters. Section 146 will continue to give individuals protection against victimisation—that is, action short of dismissal—because of their trade union membership or non-membership, but it will not prevent employers from making and implementing legitimate decisions about how they wish to negotiate with their employees.
    Mr. Alex Carlile: Does the Secretary of State take the view that Lord Justice Dillon was stating the law correctly when, in the Wilson case, he said that the employer enters a potential danger area—in other words, he breaks the law —if he offers a douceur to employees for supporting his policy of derecognising a union and making consequential changes in the terms and conditions of employment? If that is a correct statement of the law, as I certainly believe it to be, is not the Secretary of State now legalising the offering of what Lord Justice Dillon called a douceur to employees who will support his policy? Is not "douceur" a rather elegant alternative for "bribe"? How can the right hon. Gentleman justify such a change?
    Mr. Hunt: I thought that I had dealt already with that matter. Having read the judgments of the Court of Appeal in both cases, I believe that the clear distinction that was drawn between individual rights of employees and collective bargaining issues has been confused. Surely that was never the legislature's intention in passing the original provision. I have already referred to Lord Jacques's comment that the provision deals with individual rights of employees, not collective bargaining issues.
    It has always been possible for an employer to derecognise a particular trade union. It has always been possible for an employer to offer different rates of pay, to reward those employees who wish to enter into individual contracts rather than participate in collective bargaining. We could have a long argument, but I hope that hon. Members will accept that it is my genuine belief that the confusion between the individual rights of employees and collective bargaining issues has made the need for this amendment as urgent as I am arguing that it is.
    Mr. Peter Bottomley: I should like to quote some words of an employer. As it may be for an industrial tribunal to judge whether the employer was being reasonable, or whether any reasonable employer could hold this view, I do not want my right hon. Friend to reply to the point. These are the employer's words:
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    "We believe that higher pay for those on personal contracts is essential if individuals are to be treated fairly."
    In other words, people doing the same work should be paid at different rates.
    The House ought to consider whether a reasonable employer could hold that view. My understanding is that, according to the Ullswater amendment, whatever else might be demonstrated before an industrial tribunal, it will not be possible in such circumstances to demonstrate that an employer has acted unlawfully, as there is a purpose in addition to the purpose of deterring trade union membership.
    Mr. Hunt: I am not disagreeing with my hon. Friend. Let him reflect on what I have just said. I have quoted from the speech that the noble Earl Ferrers made in another place in 1982. The noble Earl said that it would not be unfair to have differentiation between rates of pay. It has always been possible for an employer to offer additional money to employees who are prepared to enter into individual contracts. I have been trying to explain to the hon. and learned Member for Montgomery that this amendment is necessary so that we may get back to the situation that existed not just before the Court of Appeal cases but since 1975.
    The amendment does no more than clarify this aspect of the law. It will apply only in a particular set of circumstances, similar to those that arose in the recent cases that I described. Only when an employer wishes to bring about a change in the way in which he conducts his relationship with his employees and in order to do so takes action that is argued to be in contravention of section 146 will the amendment come into play—and even then only if the action is reasonable in all the circumstances.
    It is an important amendment, but it does not amount to a change in the law as it was understood before the Court of Appeal cases. As I have argued, the Government believe that it does no more than to ensure that the law is applied in the way that was originally intended, by clarifying the distinction between bargaining arrangements on the one hand and membership of trade unions on the other.
    Mr. Martlew: Is the Minister saying that, if an individual employee for some reason did not wish to join a trade union, it would be legal for the employer to negotiate a contract allowing him to pay that employee less than the members of a trade union?
    Mr. Hunt: It is perfectly possible—indeed, it is part of normal practice—for employers to wish to enter into individual arrangements with individual employees and to provide additional rates of pay if that employee decides to move in that direction. It is perfectly possible to have differential rates of pay. That could mean more or it could mean less: it has always been possible to pay less or more in accordance with individual contracts with individual employees. The hon. Member for Bolsover pointed out that, in the UDM-NUM case, the issue was extra pay because of trade union membership. That is why I differentiated as I did.
    Mr. Leighton: We seem to be living in an age of macho management. The Minister says that it has always been possible to do this sort of thing. Can he give examples of precedents for employers offering such "douceurs"?
    Mr. Hunt: It is a recognised fact of life: it happens all the time in various industries. I find it extraordinary that, whereas the traditional case made by Opposition Members for trade union membership has been that trade unions force wages up, they now argue that companies all over the United Kingdom will actually pay people more when they renource collective bargaining arrangements. That is a paradox that I find it difficult to accept. Of course I will provide the hon. Gentleman with precedents, but I ask him to take it from me that the amendment merely takes the law back to where it is believed it was before the Court of Appeal cases.
    Moreover, I want to make it very clear—because I reckon that we may be treated to some wild assertions by the hon. Member for Holborn and St. Pancras (Mr. Dobson)—that the amendment will not apply solely to cases in which the action taken by the employer is related to his decision to derecognise a trade union. The amendment means that, in any circumstances in which an employer wants to change his negotiating arrangements and takes reasonable action to bring about that change, he will not be acting in contravention of section 146 of the 1992 Act.
    Mr. Devlin: I accept what my hon. Friend says about the law always having been this way, but may I go back to the point made much earlier by the hon. and learned Member for Montgomery (Mr. Carlile)? I am not saying that my hon. Friend the Minister is wrong but, if —I emphasise "if"—it were found that the law as it is now being clarified was in breach of the European convention on human rights, would the Government then be prepared to change the law as quickly as possible to bring the clarification within the remit of the convention?
    Mr. Hunt: I would not bring forward the amendment if I felt that it would be in breach of international conventions or would affect the right of an individual to belong, or not to belong, to a trade union. I make that clear to the House. Obviously, the law is kept under review. If there is an argument that my hon. Friend can make, I shall look at it, but I present the case to the House on the basis that there is to be a clear distinction between trade union membership on the one hand and collective bargaining rights on the other.
    Several hon. Members rose
    4.30 pm
    Mr. Hunt: I shall finish dealing with the point before giving way, because I wish to make it clear that the amendment means that, in any situation in which an employer wants to change his negotiating arrangements and takes reasonable action to bring about that change, he will not be acting in contravention of section 146.
    I give another example. It means that if an employer wants to introduce a single-union deal—that is, recognition, for collective bargaining purposes, of a single union to represent the work force—he will be able to offer his employees a financial or other incentive to persuade them to agree to such an arrangement.
    It will, as I have emphasised, remain unlawful for any employer to take action against any employee on grounds of trade union membership or non-membership. But an employer would not be acting unlawfully if he took action to encourage his employees to be represented in negotiations by a trade union. The employer who judges
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    that a single union deal or collective agreement is the best option for his business will be protected by the amendment, just as much as the employer who opts for personal contracts. I hope that the hon. Member for Holborn and St. Pancras will bear that in mind.
    Mr. Oliver Heald: Will my right hon. Friend confirm that, during the 1980s, there was a trend towards individualised contracts or single-union deals because of the efficiency and competitiveness that resulted from them, and because they allowed terms and conditions of employment to be tailored to the needs of the workplace? Does he agree that many modern businesses that are competing well in Swindon, Sunderland and elsewhere have those arrangements?
    Mr. Hunt: My hon. Friend is absolutely right. A major achievement of Conservative Governments who have introduced legislation in this area since 1979 has been to remove the rigidities which inhibited competitiveness in the British economy. The statistics show that clearly. Opposition Members are always throwing statistics at the Government. I ask them to heed the statistics that show that, between 1974 and 1979, when we last had a Labour Government, the average number of working days lost per 1,000 employees was over 500. We are now down to 20, 30 or 40 working days lost per 1,000 employees. That is the greatest testimony to the success of Conservative industrial relations legislation.
    Mr. Barnes: Does the Minister believe that trade unions should be only friendly societies, providing legal services and pension funds for their members, and should not be involved collectively in bargaining to improve the conditions of their members? That seems to be the attitude surrounding the right hon. Gentleman's argument, particularly in relation to Opposition Members.
    Mr. Hunt: It is on that point that the hon. Gentleman probably has the biggest problem understanding the situation. It is for employees to decide whether or not they wish—[Interruption.] I thought that the hon. Gentleman referred to collective negotiation. I am differentiating between collective bargaining and individual trade union membership.
    I assure the hon. Member for Derbyshire, North-East (Mr. Barnes) that I have had the benefit of a great deal of experience of trade unions. To describe them as friendly societies—while, at the same time, the only alternative is collective bargaining—is ridiculous. Trade union membership means much more than just membership of a friendly society, even when the members of a trade union decide that they do not wish their trade union membership to be involved in any way in their collective bargaining issues.
    Only an employer can determine the negotiating arrangements that best suit his specific business, on the basis of his knowledge of all the relevant circumstances. As my hon. Friend the Member for Hertfordshire, North (Mr. Heald) said, if an employer comes to the conclusion that he wishes to move from collective bargaining to a more flexible pay negotiating system, why should the law prevent him from taking reasonable steps to encourage his work force to agree to his proposals and thus implement that decision? Why should employees who want to benefit

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    from moving to personal contracts be prevented from doing so, whether they are trade union members or not? Those are the questions that the House must answer.
    Mr. Frank Cook: Like other hon. Members, I welcome the Secretary of State to the Dispatch Box in his new position. I first recall him as a more junior Minister for Energy, and he was competent and proficient then. This afternoon, he is trying to make a fist of his job, under the guise of clarification of the law, to make a fairly radical change to it. The law did not need clarification in the first place. At least, if it needed clarification, it would appear to be only for the Secretary of State. He is simply trying to convince the House that many people out there want the change—the clarification—that he is offering.
    This afternoon, Cleveland county council faxed to me a clear statement that it is wholly opposed to the proposals, and asked me to bring that opposition to the attention of the Secretary of State. I am sure that he will not be surprised by that, and will tell me that it is because Cleveland county council is Labour-dominated. I want him to know that a unanimous decision was made at a fully attended meeting, so everyone is against his proposal.
    Mr. Hunt: I thank the hon. Gentleman for his kind words. I hope that his attempt to destroy my career by heaping me with praise will be unsuccessful.
    As far as Cleveland county council is concerned, many outside observers have had considerable concerns aroused by listening to media reports and reading some of the press reports and scare stories about this amendment. I encourage the hon. Gentleman to ensure that a copy of Hansard containing my speech and his intervention goes straight back to the council, and that the council reconsiders its decision in the light of the assurances that I have given.
    To allow a law that was created for different purposes to impede business decisions of the nature that I have described is wrong. I reiterate that amendment No. 8 will restore the law to the meaning that it was intended to have when it was approved by Parliament in 1975, and I commend it to the House.
    Mr. Dobson: I welcome the Secretary of State to his task. He comes to it with a newspaper reputation for liberalism and decency, and we look forward to evidence of that at some stage in the proceedings.
    I remind the House that, since I first stood for Parliament, I have been sponsored by what is now the National Union of Rail, Maritime and Transport Workers, formerly the National Union of Railwaymen. The union makes a substantial contribution to my election expenses and the salary of my agent. I am grateful to the union for its help. I am proud to be sponsored by the union of which both my father and grandfather were members. I am proud to be associated with the union that represents thousands of transport workers, especially the railway workers employed at King's Cross, Euston and St. Pancras main line stations and 16 other stations, mainly on the underground, which are all in my constituency. Those facts are well known to my constituents and have always been on the public record—and that is how it should be. Only those who are ashamed of the sources of their funds need to keep them secret.
    Let me make it clear that we are utterly opposed to amendment No. 8 passed by the other place. We object to it because it is wrong in principle and certain to be harmful
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    in practice. The proposal is a savage attack on the rights of individual employees. It undermines their right to freedom of association and to choose freely who will represent them. We also object to the way in which the amendment was bounced through the other place, without proper consultation or notice. Presented at the last minute, the amendment was an abuse of parliamentary procedure and the Government's powers. It was most ably resisted by Labour and other peers, but the Government used their majority to force it through.
    For those reasons, we pressed the Government to devote the rest of today's debate to this important amendment and we are glad that they have agreed. I hope, although I am not hopeful, that by the end of the debate they will accept that their proposal is wrong. By the amendment the Government propose to make it lawful for employers to bribe employees to give up the right to trade union representation. In other words, this corrupt Government want to make corruption part of the law of the land. Until now everyone has accepted that such action by employers was against the law.
    The law in question was first passed in 1975. It has remained unamended since then, through all the changing scenes of life at the Department of Employment—untouched by Tebbit or Thatcher and undefiled even by the right hon. and learned Member for Folkestone and Hythe (Mr. Howard). The Tories have passed five major industrial relations laws since 1979, but until now this law has been left intact. The present law is set out in the Trade Union and Labour Relations (Consolidation) Act 1992 which was passed as recently as 14 July last year. That Act makes it unlawful for an employer to dismiss an employee for being a union member or for joining in union activities. The Act also makes it unlawful for an employer to take "action short of dismissal" with the purpose of preventing or deterring an employee from joining a union and to penalise an employee for doing so. The Act also makes it unlawful to prevent or deter an employee from or penalise him for taking part in union activities. Such action is, rightly, against the law, yet this amendment would change all that.
    If we were to agree to the amendment, it would permit employers to prevent or deter employees from union membership or union activity and to penalise them for it. The amendment would not just permit employers to act in that outrageous way, but would encourage them by giving their action the seal of parliamentary approval.
    All this has come about because on 30 April the Court of Appeal made it clear that the law meant what it said: that it was unlawful for an employer to offer bribes or threaten fines to induce employees to give up trade union representation. The Court of Appeal took the commonsense view that bribes and fines meant that employers were out to prevent, deter or penalise trade unionists.
    It is worth reminding the House just who had been breaking the law. The two companies in question were Associated Newspapers, owners of the Daily Mail and by appointment principal media supporters of the Tory party, and Associated British Ports, by appointment of this Tory Government owners of Britain's privatised ports. Both companies had long-standing agreements with their employees to recognise trade unions and negotiate with them the terms and conditions of those of their employees who wished to be represented in that way. In the case of the Daily Mail, the agreement dated back to 1912. Under the agreements negotiations were conducted between the

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    employers on the one hand and the unions on the other, and the employers and employees each chose who would represent them in the negotiations. Both companies decided that they wanted to put an end to these arrangements and put their employees on individual contracts that ruled out employees being represented by their union. In other words, in future the employer would decide who represented both sides in the negotiations.
    Mr. Heald rose—
    4.45 pm
    Mr. Dobson: Just a minute. I may give way in a moment.
    In case anyone thinks I am exaggerating, I refer the House to the Court of Appeal judgment which records that at Associated Newspapers the group managing director explained that
    "henceforth staff would be represented by their Editors and Heads of Department."
    In other words, in future relations between staff and management individual staff would be represented by their boss who would in turn negotiate with his or her boss. The Tories have some strange concepts of representation, but that beggars all description.
    In an effort to induce employees to accept this one-sided bargain to give up the right to choose who represented them or the right even to seek such representation in future, both companies offered big pay increases to those employees who were willing under duress to sign away their rights. The companies denied such pay increases to any employees who refused to relinquish trade union representation. As I shall explain, the sums were not trivial.
    In the case of Associated Newspapers, Mr. David Wilson, backed up by the National Union of Journalists, challenged this as an unlawful action short of dismissal. Dock workers from Southampton, Mr. Teddy Palmer, Mr. Brian Stedman and Mr. Eddie Wyeth, backed up by the Rail, Maritime and Transport union, made a similar challenge. In both cases the employees were supported by an industrial tribunal. In both cases their arguments were rejected in rather bizarre and certainly non-unanimous judgments of the employment appeal tribunal. In both cases the employees were backed unanimously and clearly by the Court of Appeal.
    Mr. Heald: Will the hon. Gentleman give way?
    Mr. Dobson: Not for the moment.
    The Tory Government, however, inhabit a world where big business can do no wrong. The Government decided that if the views of Associated Newspapers and Associated British Ports did not conform to the law, it was right that their views should become the law, so we have this amendment.
    Mr. Heald: Will the hon. Gentleman give way?
    Mr. Dobson: I will in a moment.
    I ask the Secretary of State to make public all representations made to him, his predecessors or any of his colleagues or officials by Associated Newspapers or Associated British Ports or anyone on their behalf. Will he tell us what threats were issued and what promises were made? Will either company contribute in future to Tory
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    party funds? I admit that these companies and others like them may not have a vote at the Tory party conference, but they do not need one. By arm twisting in secret, they have got the Tory Government to change the law and strengthen their position by taking away the rights of their employees.
    Mr. Heald rose—
    Mr. Skinner: The hon. Gentleman has a handout from his Front Bench.
    Mr. Heald: This is actually a letter asking me to phone my wife.
    Mr. Deputy Speaker (Mr. Geoffrey Lofthouse): Order. I am sure that the message from the hon. Member's wife has nothing to do with the debate.
    Mr. Heald: Does the hon. Gentleman agree that for Associated Newspapers and Associated British Ports the decision has been made? There is nothing in this for them because the proposal starts from now. It does not affect the past.
    Mr. Dobson: There are plenty of times when I am glad that I am not a lawyer and I am even gladder, if there is such a word, having heard that contribution from one who is. That is one of the daftest interventions that I have heard in this place —and I have heard some daft ones.
    The amendment is before us now because the Court of Appeal upheld the position of people who had worked for many years at Associated Newspapers and Associated British Ports. We are illustrating what will happen to others if the House agrees to the amendment, only in future such action will have the endorsement of Parliament. If the amendment is agreed and the Government make it lawful to bribe and fine employees for seeking to be represented by a union, will any action short of dismissal be against the law? Will there be no limit on what employers can do?
    In future, as a result of the amendment, employers will he able to promote and demote, not on merit but on the basis of an employee's willingness to sign away his rights. Employers will offer longer holidays or shorter hours only to those who conform. Non-conforming employees will be the ones who are redeployed from a good location to a bad one in an unpopular part of the country. They will be the ones set to work in the worst conditions, doing the dirtiest and most dangerous jobs. They will be the ones who are made to work awkward shifts or permanent nights.
    The Tories are introducing victimisation by Act of Parliament. As a result of the amendment, employers will also be able to deny profit sharing or bonuses to people who want to be represented by their union. Unscrupulous employers will also be able to threaten the pensions and other benefits of employees.
    If employers are to be allowed, by law, to bribe and fine, is there anything that they will be prevented from doing in the future? Under the new Tory law anything goes. Employers will he able to exercise any duress on their employees to make them deal with their bosses on their own, without the help of their union.
    Mr. David Young: The Government's action causes great constitutional concern because it is clear that, if courts decide anything that is offensive to the Government, the Government will then

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    change the law. Are we not moving towards a one-party or fascist state, where the courts become the puppet of the state and the Government?
    Mr. Dobson: My hon. Friend has raised an extremely good point. The reason why the Government are so opposed to the European Community having any say in our employment legislation is that, in the case of laws that start with the Community, if the Government are found to be breaking them, they must put those laws right. They cannot just change court decisions on a whim, as they have done in this case.
    What is happening is part and parcel of the Government's move to derecognise trade unions. They started with GCHQ, as the Secretary of State said, with their step-by-step approach. They have kept up the pressure. Their object is to weaken not just trade unions, but the bargaining position of employees.
    Unions came into being because individual employees realised that they were in a poor bargaining position when up against a corporate body with enormous assets and legal privileges. That is as true today as it was in the past. The lack of parity between employers and individual employees was recognised as long ago as 1908 by Winston Churchill, who said:
    "Where … you have a powerful organisation on both sides … you have a healthy bargaining which increases the competitive power of industry and thus forces a progressive standard of life … But where you have no organisation, no parity of bargaining, the good employer is undercut by the bad and the bad employer undercut by the worst."
    Putting people on individual contracts is to make a mockery of the idea of parity of bargaining. Just look at the bargaining position in the two cases that went to the Court of Appeal.
    Associated British Ports must be a wealthy organisation because it pays the boss more than £233,000 a year in salary alone. It has a turnover of £310 million and pre-tax profits of £97 million. Teddy Palmer, Brian Stedman and Eddie Wyeth did not have such resources at their disposal. All that they had to bring to the bargaining process was their skill and experience. If they did not accept the terms offered by Associated British Ports, the alternative was to try to get another job. I must point out to the Secretary of State that that is not much of an alternative in Southampton. where, even according to the Government's fiddled figures, more than 13,000 people are on the dole. That was not much of an alternative for three men, whose average age was 50, in a city where one in five men are officially out of work. There was no parity of bargaining there and the Secretary of State knows it, but he wants the newly privatised bosses to get their own way.
    Associated Newspapers is so wealthy that its highest paid director was paid more than £500,000 last year. It has assets of £500 million and pre-tax profits of £76 million. I am sure that very few people would believe that one solitary journalist had parity of bargaining with that company, which owns the Daily Mail, The Mail on Sunday and the Evening Standard and which supplies teletext to ITV.
    Those two companies are not, of course, the only ones that are derecognising unions. In the publishing industry, Reed Elsevier, the printing and publishing company, is busily trying to put all its British employees on individual contracts and to end union recognition. There is not much parity of bargaining there. Even before its merger with Elsevier, Reed International was so wealthy that it paid its
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    chairman £391,000 and had net assets in excess of £1·4 billion. It is ironic that the new combined company can pursue its course of action only in Britain. The Elsevier part of the operation is still based in Holland, where the company is required by law to recognise unions and operate works councils.
    Another major British company, Shell UK, is trying to put its employees on individual contracts and derecognise the unions. Shell is such a rich organisation that it pays its directors more than £1 million. Its net assets total more than £3,500 million. No parity of bargaining exists between Shell and its individual employees. Even with collective bargaining, such a company has always had the whip hand.
    Mr. Bill Etherington: I am enjoying my hon. Friend's speech. Has it occurred to him that one reason for trying to keep employees wages down might be so that many of the illustrious companies can add a little more to the Conservative party coffers, even though we do not know the exact amounts?
    Mr. Dobson: As far as I know, there is no evidence, yet, that Polly Peck is derecognising unions. I must admit, however, that I am not familiar with employment protection laws in northern Cyprus. The Lord Chancellor might be, however, because he paid it a special visit.
    Mr. Graham Riddick: Considering that the debate is about the position of trade unions and the rights of individuals, can the hon. Gentleman tell the House whether he believes a system of one man, one vote should be introduced for the election of the Labour leader and Labour Members?
    Mr. Deputy Speaker: Order. The proposed one man, one vote for the Labour party or anywhere else has nothing to do with the debate.
    Mr. Dobson: The problem is that, in the companies I have mentioned, it has been decided that one man, the chairman, has one vote and he votes in both sides of the negotiations.
    If the amendment goes through, every company that wants to derecognise unions will he given a free hand by the Government. All forms of bribery and coercion will be made lawful. It is all part of the wretched Government's craven approach to international competition. They no longer believe that we can compete with Germany, Japan, Holland or Belgium on quality.
    Whatever personal ambitions may drive individual members of the Cabinet, when it comes to the future of our country the Cabinet Room has become an ambition-free zone. Instead of competing with the best on quality, the Tories have thrown in the towel. The future that they offer for Britain is to compete not with the best on quality but with the cheapest on price. The Tories want to drive down wages. They want British people to continue to work the longest hours in Europe and to take the shortest holidays.
    Mr. David Hunt: I am sorry to interrupt such a carefully prepared speech. I greatly appreciated the opening generous remarks of the hon. Gentleman. He asked me a specific question about Associated British Ports and Associated Newspapers, but he will recollect that I was not Secretary of State at the time when those cases came to court. I have checked, however, and I am advised that no representations of any sort were made by either ABP or

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    Associated Newspapers before the Government decided to act. I hope that the hon. Gentleman will withdraw his accusation. Instead of relying on such a heavily prepared script, will he address the issues that I raised in my opening remarks?
    5 pm
    Mr. Dobson: The right hon. Gentleman has not answered all my questions or those that I asked on behalf of other people. He is getting a bit like the bosses of the companies: he prepares his speech, but apparently does not like it when I prepare one. We listened to him for three quarters of an hour and did not get one inch further forward. I am proceeding with my speech as I prepared it.
    Mr. Hunt: I will also use the words, "or any other persons on their behalf". Of course, the hon. Gentleman had a right to prepare his remarks. All I am asking is that, at some stage during his reply, he addresses the issues that I raised.
    Mr. Dobson: Although the right hon. Gentleman is a Secretary of State, he must learn that, to be in order, one addresses the subject of the amendment. One does not necessarily have to address all the issues raised by Conservative Members. I am addressing what I believe to be the major issues that arise from this disgusting amendment. I shall continue to raise such issues insofar as they remain in order.
    In order to reduce wages—which is the only way that the Government believe we can compete—the Government need to weaken the bargaining position of British people at work. They do not do that simply by threatening them with a dole queue of 4 million. The Tories are determined to casualise employment in Britain, and the proposals are part of that casualisation process.
    At present, people who want to work full time are being forced to go part time. Millions of people—mainly women —are left with no right against unlawful dismissal unless they have worked for five years. People with family responsibilities are being told that they face the sack if they do not work all the hours that God sends. People who thought that they had a career have been called in by their bosses and told that they can have a two or three year contract—and must take it or leave it. People have been told that, under their new contracts, they can find and fund their own pensions. As a result, people at work are feeling more and more threatened and insecure.
    I am talking not about any old people, but about the people of this country who are being treated worse at work than any other people in western Europe. It is disgraceful to have to say it, but they are being treated in that way by British-owned companies at the behest of the British Government. It is not Nissan or Toyota which behaves in that fashion—generally, the multinationals do not behave badly. They know the obligations expected of employers in Europe. They are accustomed, at least in Europe, to complying with international standards and are familiar with dealing with Governments who discharge their international obligations.
    The Opposition's next objection to the amendment is that they believe that the proposal will infringe the right to form or join a trade union set out in the European convention on human rights. We believe that it will
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    infringe the right to organise which was set out in the Council of Europe's social charter. We believe that it will infringe the guarantee of the right to collective bargaining set out in the treaty of Rome, and the obligation to develop a dialogue between management and labour required under the Single European Act, which was pushed through the House by the use of a guillotine motion by Mrs. Thatcher's Government. It will breach the International Labour Organisation convention, which provides protection against anti-union discrimination and specifically outlaws deprivation of wages or limitation on wages for taking part in union activities.
    Just in case the Euro-sceptics on the Conservative Benches are not impressed by the mainly European obligations that I have listed and believe that such protection is confined to Europe, I should add that, in Japan, the right of workers to organise, bargain and act collectively is guaranteed by the Japanese constitution. The Opposition believe that if workers in the rest of the European Community and Japan receive the benefit of decent employment protection laws. British workers should receive the same.
    The Government have come up with two justifications for the change in the law. They have argued that their proposal is not an attack on the right of employees to be members of a trade union. The Tories say that the proposal only prevents union members from trying to make use of their membership. That argument was rejected by the Court of Appeal, which quoted with approval an earlier decision quoted by my hon. Friend the Member for Wallasey (Ms Eagle). That decision, which is worth repeating, stated:
    "the activities of a trade union officer in negotiating and elucidating terms of employment is … the outward and visible manifestation of trade union membership."
    It also stated that the argument now used by the Government would emasculate legal protection. Later, the Court of Appeal described as unreal the argument that being a union member meant nothing more than having a membership card. How right it was: having a union card but not being allowed to use it would be as unreal as having a credit card, but not being allowed to use it. In those circumstances, both cards would he neither use nor ornament.
    Although Conservative Members may prefer to forget what they said at the general election, I am sure that my hon. Friends need not be reminded that the Tory party manifesto stated that the Labour party would disrupt industrial peace by weakening the courts. It is not the Labour party which is weakening the courts today. The Tories also said that the workers' rights in which they believed were those which enhanced individuals' status and opportunities. David Wilson, Teddy Palmer, Brian Stedman and Eddie Wyeth are all individuals. What about their status and opportunities? What about the status and opportunities of the thousands of individuals who will now be subject to lawful bribery and brow-beating if the amendment is passed?
    The Government have also claimed that the amendment is necessary to clarify the law. Presumably they would like us to believe that Associated Newspapers and Associated British Ports were innocently misled into their law-breaking campaign of bribery and corruption. Most people would find that hard to believe. They would find it even harder to believe if they knew about the battery of lawyers that each company has deployed on the case.

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    The law is clear; the wording is plain. However, if for the sake of argument we were to conclude that the law needed to be clarified, that does not mean that it needs to be clarified For the benefit of employers and the disadvantage of employees. It could be clarified in another way. Parliament could make clearer still the fact that bribery is against the law. That is what was previously meant and what the law should mean now.
    We believe that British people should have more rights at work than they have now. In times of rapid industrial change, uncertainty and insecurity, people at work need more protection, not less. Their need for trade unions grows rather than diminishes in times like the present. When individual employees are being picked off at leisure by unscrupulous employers, the right of employees to act together to protect one another should be strengthened, not weakened. We believe that the Government should end derecognition by changing the law.
    We believe that, as in the rest of the European Community, employees in Britain should have the right to be represented through trade unions, and that that recognition should be obligatory where there is substantial support among the employees. That idea works as we can see from the rest of the EC. Decent employment laws do not hold back countries or economies. Decent employment laws apply in the seven EC countries which have a higher standard of living than Britain. Decent employment laws apply in the seven EC countries which export more per head of population than does Britain. Decent employment laws apply in every other EC country which have a better trade balance with the rest of the world than Britain has. Decent employment laws go with economic success, high pay and prosperity. The Government's policies of promoting casual employment and insecurity go with economic failure, low pay and poverty.
    The amendment shows the Tory party at its worst, capitulating to secret pressures from its rich and powerful supporters to the disadvantage of ordinary people who have to work for a living. It is wrong in principle, it will be harmful in practice, and it will add to the growing insecurity of everyone at work. It is an assault on free trade unions and seeks to shift Britain's industrial relations back to the previous century rather than move them forward to new, better and more productive relationships for the century to come. This elected House should represent the interests of people at work and tell the House of Lords, "We do not accept this amendment."
    Mr. Peter Bottomley: The amendment proposes to change the part of the Bill that is headed:
    "Rights in relation to union membership".
    It is clear that it has to do with wrongs in relation to union membership.
    It was recently said that
    "talk of undermining freedom of association was poppycock".
    I should like to share with the House the decision of the industrial tribunal. Paragraph 60 of its report states:
    "The Tribunal was satisfied that in the context of this case and on the facts we have found the respondents' purpose was so to reduce the power of the union as to negate it totally. If this had not been their purpose they would have recognised the union for matters other than wage negotiations if they had so wished."
    To say that what the amendment proposes is not an attack on free association is undermined by those words.
    On page 16 of his Court of Appeal judgment, after the quotation
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    "The purpose was not in dispute—it was to 'end collective bargaining'",
    Lord Justice Dillon said:
    "That was indeed the stated purpose of the employers, and it is common ground that 'collective bargaining' was not intended to be limited to collective bargaining about pay."
    We have on reasonable authority, on behalf of the Government, the statement that discrimination against individual workers on grounds of trade union membership will remain illegal. Paragraph 61 of the industrial tribunal's judgment states:
    "The Tribunal considered that the respondents were fully aware that by depriving the union of any function in the work place (save on health and safety) they were effectively rendering the union powerless and thus membership pointless."
    I remind the House that the case before the industrial tribunal was under a section dealing with deterring an individual from union membership. It is difficult to square that with the statement that discrimination against individual workers on the ground of trade union membership will remain illegal.
    My understanding of the words to be inserted before clause 13 of the Bill by what is referred to as the Ullswater amendment is that they would forbid an industrial tribunal to hold that an employer had acted illegally if the consequence of his action would be held by that tribunal to have the purpose of deterring an individual from union membership.
    Those of us who want to support the Government—as I normally do, though in this case I want to keep the law as it is—have been told that if an employer can show that it is reasonable to have another purpose, an industrial tribunal will not be able to hold that that which is now illegal will remain illegal.
    I could quote at length from the Court of Appeal judgment, which upholds without difficulty the industrial tribunal's findings of fact and law. I shall not do that, but shall merely quote from paragraph 62 of the industrial tribunal finding. It states:
    "The Tribunal did not consider that the respondents"—
    that is, the employers—

    "could hide behind their right to de-recognise the union so as to deny successfully their ultimate purpose which was to effect the wholly foreseeable consequence of deterring individual journalists from being union members."
    Of course, the case goes far wider than that because for "journalists" we could read "any employees".
    5.15 pm
    In his judgment, Lord Justice Dillon considers the four points that the employment appeal tribunal considered. He says that the employment appeal tribunal found a distinction or a difference that did not amount to much.
    The question was: what was the purpose of the employers in derecognising the union, ending collective bargaining and changing the terms and conditions of their employees? It was held, with the agreement of the other members of the Court of Appeal, that the industrial tribunal was entitled to find that the purpose was as stated in paragraph 60:
    "so to reduce the power of the union as to negate it totally."
    The evidence quoted by Lord Justice Dillon is sufficient to support that finding, which does not square with the statement
    "that talk of undermining freedom of association is poppycock".
    It is unwise for hon. Members to say that the considered view of a member of the Court of Appeal is "poppycock".

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    If I wanted to disagree with the Court of Appeal's judgment, I should say, "It has stated the law, which is its right, unless that is overturned by the House of Lords, but I should prefer the law to be different from what it appears to the Court of Appeal and the industrial tribunal." Although my background is not comprehensive, I would argue that people have understood the law for about the last decade.
    I was taken on as an industrial relations officer by the British Steel Corporation in 1968. I spent a year working with industrial relations and personnel specialists throughout the corporation, which was substantially larger then than it is now. I had dealings with Government Departments and worked in an office that dealt with local and national trade union relations, personnel and social policy. I was fairly low down.
    I gained the qualifications of the Institute of Personnel Management and was later upgraded to a fellow of the institute. I do not think that it was a consequence of that that the then Prime Minister asked me to join the Department of Employment, where, for more than a year, I was an Under-Secretary with responsibility for industrial relations, employment law and matters such as health and safety. Following a change of responsibilities, I took over equal opportunities from Alan Clark. Since that time, I have maintained an interest in those issues.
    With the exception of one or two parts, the Bill has my support because it is justifiable. I shall not reiterate any of my speeches on Report or on Second Reading. That which the Minister has tried to defend in the context of this amendment is unjustifiable. If the amendment is accepted, its provisions will be reversed in the same way as the exportation of the Tolpuddle martyrs in 1834 was reversed three years later, I think by a Conservative Government, although when the martyrs returned the Government may have changed.
    The watchword of those farm labourers from Dorset, who, in practice, were sent abroad because they had formed a trade union, was, "We will, we will, we will be free."
    The Court of Appeal has said that employees are free to join trade unions and that whatever other purpose an employer may have, if he takes action that has the effect of totally negating trade union membership, that is and has been unlawful. I think that that is a fair summary of the law.
    Whatever other purpose the employers had in the newspaper case and the ports case, what they did was unlawful because it totally negated union membership.
    The Ullswater amendment states that we can consider some other purpose and let it overrule the admitted effect of what employers do.
    On the last Sunday of Labour government in 1979, there was a Conservative Trade Unionists rally at Wembley attended by 2,000 trade union members and their families. I was the president of Conservative Trade Unionists at that time. Margaret Thatcher was there and many people spoke. We were demonstrating that trade union members and their families were welcome within the Conservative family and could trust the Conservatives to do things that were defensible on the shop floor, in the office and in various other places where people work.
    I am not arguing against individual contracts for senior people or for people of any grade or level within an organisation. As the industrial tribunal held in paragraphs 60, 61 and 62 that the effect of what the employers did was
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    totally to negate trade union membership, that should be regarded in simple terms as a straightforward undermining of freedom of association.
    Associated Newspapers could have achieved its objective in a way that was not unlawful, although I would not necessarily have approved of what it did. I should be careful about how I put this, but newspapers have had great success in getting employees on to individual contracts whether or not they wanted them. In my view, it would have been possible for Associated Newspapers to achieve its objective without acting unlawfully, but it is not my purpose to give newspapers free consultancy advice on how to achieve their aims; they have plenty of good lawyers of their own.
    The ports employer wrote to me saying that the company
    "took legal advice at every stage of the transition to personal contracts".
    If it took legal advice and was held by the industrial tribunal and the Court of Appeal to have done something illegal, I suggest that the company should consider the quality of that legal advice. If it argued that because it is now preparing to apply for leave to go to the House of Lords, let me make the following plea to my right hon. and hon. Friends on the Front Bench.

    The cost and the financial risk to an employee and a trade union of even getting to the Court of Appeal where one is facing rafts of QCs is high. I would estimate that the cost to one of those applicants, if they had failed in the Court of Appeal, would have been about £150,000.
    The law is supposed to be, and always was, clear. It was obvious to the industrial tribunal and the Court of Appeal. Will my right hon. Friend consider taking over the action if leave is granted by the House of Lords and indemnify the successful applicant? I am not asking for an answer today.
    The Government's intention is quite clear, as shown by Lord Ullswater's announcement six days after the Court of Appeal gave its decision, that they would overturn the judgment by the Court of Appeal. Six days is pretty fast in Government terms, especially when two days were a weekend and one may have been a bank holiday; they could not have had more than four working days. If, from the moment they heard the result or even before the Court of Appeal produced its judgment, the Government's intention had been to nullify any judgment not in accord with their now stated view, there is a case in justice and equity for the Government to say that the Appeal Court decision to award costs to the applicant would stand so that, in any case in the House of Lords at least, the applicants would not be at further financial risk.
    The Government made it plain on 6 May, in the debate in the House of Lords on 24 May and again today that they are not at present willing to accept the law as stated by the Court of Appeal. My view is that there is no reason for the House of Lords to give leave to appeal, because the confusion in the minds of the employment appeal tribunal —a perfectly genuine confusion—was in the distinction of words. The Court of Appeal judgment was clear.
    Let us move on to what is right and return to the law in a moment. There are two circumstances that trouble or should trouble the House. The first is where there are collective agreements. The employer wants to derecognise the union for a purpose or for all purposes except for health and safety at work, as the Health and Safety at Work, etc. Act 1974 would not allow that.

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    If individual contracts are to be imposed, or if collective bargaining is to be nullified, my understanding is that the employer has to give sufficient notice and then can say, "From our point of view, the collective agreement has gone and there will be new terms of employment." In those circumstances, an employer should not be able to take action that discriminates between union members and non-union members to the effect of totally negating union membership.
    The second circumstance would involve an employer whose employees are on individual contracts. Let us suppose that one or two of the employees join a union, or have always been a member of a union, but want to start working together collectively and approach the employer on that basis. If in the individual contracts of employment, out of a pay index of 100, for example, 20 units or one fifth of the employees' salary was paid as a consideration for being on individual contracts of employment, would the employer be able to say to two or more employees who had asked a union to approach the employer asking for collective recognition and bargaining—a perfectly reasonable request—"We are sorry, but because your contract of employment which you signed as an employee and we signed as an employer says that one fifth of your earnings are in consideration of your being on individual contracts, and because your union has now made an approach, you should now give back 20 per cent. of your pay"? Would that be lawful?
    As the consideration of being on individual contracts was 4·5 per cent. in the Associated Newspapers case, I should like to have stated with authority what the position would be. I am not a lawyer; I have only been involved in industrial relations, industrial economics and other practical things. Perhaps a clever lawyer can find a way of making sure there is an instant penalty if ever a union representative appears at an employer's door saying, "We have been asked by some of your work force if you will speak to us as their representatives." I find it very worrying and see it as a possibility of undermining freedom of association.
    In my trade union branch we have had occasional campaigns, although I have not taken an active part in them, to get union recognition in the hotel and catering industries, which used to have some minimum protection by wages councils, at least for a minimum hourly rate. We have been told by some Ministers that the abolition of wages councils would lead to an increase in employment. I say in passing that the best estimate was that if we reduced the pay of people on minimum rates by 18 per cent. we might achieve a 1 per cent. increase in employment in those fields.
    The implication of the abolition of wages councils was that collective agreements could come in and do as well. The case constantly being offered to the House was of people in the road haulage industry, leaving aside the fact that that industry has some of the strongest union organisation in the country.
    People in wages councils industries, or what will soon be ex-wages councils industries, are in the main presumably on individual contracts of employment, as union organisation is not strong in those industries. If a trade union representative, whether a lay representative or a paid representative, goes to the employer and says, "I want to say a few words on behalf of the people you employ," will penalties on those workers be lawful?
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    An employer can say, hand on heart, "It is in the interests of my employees, because it is in the interests of my customers, for all employees to be on individual contracts" and may consider that to be a reasonable belief. It would not be a common one, but it might be held to be reasonable. If not, what is the point of the Ullswater amendment?
    I return to what people thought the law had been. That point was made by my right hon. Friend the Secretary of State who spoke about restoring the law to what it was held to be. The Appeal Court has done that. I am becoming more conservative as I spend more years in the House. Perhaps I have spent too long in the House because I am becoming a little stuck in the mud.
    The law was commonly held by people in personnel management, in the Industrial Society, among trade unions and among most employers' associations to be that action could not be taken which would, in effect, negate the benefits of union membership, with the exception, as my right hon. Friend the Secretary of State would remind me if I did not say it first, of some rights concerning accidents at work or other problems, in which area he has more experience than I have and union members have more reason to be grateful to him than to me because I have not done such work.
    5.30 pm
    My right hon. Friend said that he has nothing against trade unions. I accept that. He said that we should not confuse collective bargaining with other things. I have read out the part of the Court of Appeal judgment which elides whatever difference there may have been between us. My right hon. Friend referred to the 1975 debate. In full context, that would probably prove a point that I would want to make, but there is no need to argue about it too much, because we can always return to the fact that the industrial tribunal and the Court of Appeal produced a judgment saying that the law was what I had believed it to be and what most people had believed it to be.
    The question that we must put back to the Government is whether the Ullswater amendment clarifies the law or changes the law. I hope that the debate will persuade the Government Front Bench that its effect is to change the law. That point has obviously not been accepted by the Front Bench and it may take some time to do so, but that is the essential point.
    If the general view is that the law is being changed by the Ullswater amendment, introduced on a procedural basis in a fairly unusual and abrupt way, I hope that my right hon. Friend will tell the House that he will in some way try to ensure that its effect will be at least suspended until there has been consultation.
    I hope that whoever replies to the debate will answer this question: what consultation paper was available in public to the trade unions, the TUC, employers, the CBI, the Engineering Employers Federation and all the other employers' federations and associations before the Government decided on the terms of the Ullswater amendment? I have not been aware of one and I have not seen an open consultation paper on its contents in the press that I read.
    One can argue that from 6 May to 24 May was only about two and a half weeks, but open consultation would still have been possible. I ask any hon. Member to intervene and tell me if he or she was aware of any open consultation on the Ullswater amendment.
    Mr. Peter Thurnham: There was a fairly clear understanding of how things worked until the Court of Appeal judgment. That is what caused the difficulty. That is why the Government were right to introduce the Ullswater amendment to clear up the matter.
    Mr. Bottomley: That may be so, but I remind the House that the question that I was putting was whether any hon. Member was aware of any open consultation between 6 May and 24 May when the Ullswater amendment was considered in the other place. I am not aware that hon. Members who have links with trade unions are rising. I am not aware that those who may have better links with employers are rising. In fact, I notice no movement anywhere.
    My hon. Friend the Member for Bolton, North-East (Mr. Thurnham) makes the point that everyone thought that the law allowed employers to do what two employers were told by the Court of Appeal was illegal. That may be so, but it is not a view which I share. However, my hon. Friend, in his creation of jobs, may have had a different experience. I do not think that employers previously believed that to be the law. I think that Associated British Ports and the newspaper group received legal advice saying that such action was worth a try and the industrial tribunal said that it was not worth a try.
    Mr. Patrick Nicholls: I am grateful to the hon. Gentleman for giving way. [Interruption.] One chooses one's friends. I put the point in the way that I wish to. The hon. Gentleman makes the point that there was no consultation. Precisely what does he think the purpose of that consultation would have been? Does he envisage that he might have changed his own mind? I have to say that I doubt it, in which case I am not sure what the purpose of that consultation would have been.
    Mr. Bottomley: It is silly for people in the same party when they have a disagreement to resort to that sort of personal abuse which is uncharacteristic of Members of the House. I am aware that when I was a Minister my hon. Friend the Member for Teignbridge (Mr. Nicholls) was one of those who thought that I was not doing the right thing on wages councils. As a member of the Conservative party, I do not think that we do the wrong thing when we speak up for those who may want to band together for collective strength. We may have differences and disagreements, but some kind of loyalty to each other is a reasonable thing for which to ask. If my hon. Friend thinks that I am not open to argument, he does not know me very well.
    I shall repeat the question and then leave it. Who shows any manifestation of believing that the worth of union membership could be totally negated but not have that held as a deterrence of union membership, which is clearly unlawful?
    There is no doubt that deterrence of union membership is unlawful. If I am wrong about that my hon. Friend will no doubt intervene. He rightly accepts the law and that is plainly the law.
    Then comes the question whether we should allow the law to be changed to allow another purpose to overtake that purpose of deterring union membership. My argument is no, we should not.
    My regret is that there are not more Conservative Members who have come up through trade unions who,
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    speaking the sort of words and expressing the sort of thoughts that I have been doing, can represent those whom I have been representing here today.
    It is a mistake for the trade unions to continue their strong links with the Labour party. That is one reason why we have an unbalanced debate. I hope that in time the Conservative party will show, in its actions as well as in its words, in what it does in the House as well as in what it says at election time, that it wants the support of working people, whether or not they are members of unions; that we want people to choose whether to join a union and that we shall maintain the law as it has been clearly stated since 1975 and that no one shall be deterred from union membership.
    Mr. Leighton: If ever anyone wanted evidence of the need for a change of Government, the appalling way in which the Government are behaving on this issue is it. Only a Government with the arrogance that comes from 14 years in power, a Government who think that they can do what they like, would attempt to do what they are doing and in such a way, overturning the decisions of the courts and abusing parliamentary procedures. When it come to assaulting trade unions, the Government think that anything goes.
    The amendment must be a violation of international agreements. It must be a breach of International Labour Organisation conventions because it is a direct assault on the freedom of association, which is a basic human right. It penalises and victimises citizens for what the Government appear to regard as the crime of collective bargaining.
    Let us consider the case, mentioned by the hon. Member for Eltham (Mr. Bottomley), of Associated Newspapers Ltd. v. Wilson. That company publishes the Daily Mail and similar associated papers and had recognised the National Union of Journalists since 1912. In 1989, the editors of the firm's three papers decided to derecognise the NUJ and to move from collectively agreed terms and conditions of employment to individual contracts.
    Those on individual contracts received salaries that were 4·5 per cent. higher than those being paid under the collective agreement. Incidentally, that increase was backdated to 1989. The individual, Mr. Wilson —I emphasise the word "individual" because I have heard all the Government's rhetoric about how they are looking after the rights of the individual—claimed that, by paying him less and providing him with less favourable terms and conditions than those who had transferred to individual contracts, the firm had taken action short of dismissal against him which was penalising him for being a union member.
    What is the law? Section 23(1) of the Employers Protection (Consolidation) Act 1978 states that
    "every employee shall have the right not to have action (short of dismissal) taken against him as an individual by his employer for the purposes of … preventing or deterring him from being or seeking to become a member of an independent trade union, or penalising him for doing so".
    That is the law; that language has been in our law for two decades. It was introduced in the early 1970s, since when six anti-union Bills have been enacted without interfering with it.
    In its judgment allowing the appeal, the Court of Appeal held that when terms offered under personal contracts were better than those available under a

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    collective agreement, with the aim of reducing the power of the union to the point where it was wholly negated, the purpose of the action was clearly to give effect to
    "the wholly foreseeable consequence of deterring employees from being trade union members".
    As such, it was an action taken to deter people from trade union membership within the meaning of section 23 of the Act. A similar judgment was made in the case of Associated British Ports.
    That judgment was unanimous: all three judges concurred that the employer's action constituted unlawful discrimination. The law is clear; the employer's action breached Acts dating back to the early 1970s and the words that I have quoted have been consolidated in all the legislation that the Government have enacted since 1979. It is ludicrous for them to claim that the law is unclear and that the amendment is intended merely to clarify it. The truth is that the law is too clear for the Government. They do not want to clarify it; they want to change it, to the detriment of individual employees. It is all part of their vindictive attack on workers' rights and freedoms.
    Surely, if there is any difficulty, the law should be clarified in the courts. We do not know whether this case is likely to go to the House of Lords. How is it possible to talk about clarifying the law when the Law Lords have yet to consider the matter? One cannot but be amazed and appalled by the Government's extraordinary behaviour: they are showing complete disrepect for the law and the courts. Within days of the judgment, before anyone had read the full transcript of the ruling and without waiting to see whether there would be an appeal to the House of Lords, they announced the tabling of an amendment to change the law because the judges had not done what the Government wanted them to do. They proposed immediate legislation, with none of the usual prior consultation with interested parties. Moreover, the text of the amendment was not available until the last possible moment before the debate.
    I understand that the Standing Orders in the other place were suspended to allow the amendment to be dealt with in Committee, on Report and on Third Reading in a single day, which kept the House sitting until 2 am. What a way for the mother of Parliaments to behave; what an example to set other countries. Some of us are members of the Commonwealth Parliamentary Association and the Inter-Parliamentary Union, and take part in seminars to explain to visitors the wonderful way in which our Parliament works and the rule of law in this country. I wonder whether we shall be sufficiently proud of this example to explain it to them.
    The amendment is an attack on workers' freedom of association—on basic human rights and freedoms. The Minister has told us that it is all right for a worker to have a union card—that is a private matter—but, if that worker wants to use the union's facilities, he will be penalised. That would give bad employers the green light to victimise and penalise trade unionists. It would allow them to withhold pay increases from workers who refused to renounce union representation. Workers who bargained through their unions would lose all protection against discrimination and the powers of those unions would consequently be reduced. The unions would be negated —a word used by the hon. Member for Eltham.
    The Government used to talk of reforming unions. It is now clear that they want to destroy them completely and to deny them their legitimate role. The Government are
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    venting their spleen and malice on unions: they want to stack the cards against them and in favour of macho employers. The Government should be careful; show me a country without free trade unions and I will show you a dictatorship.
    The Government should stop this vendetta against their own people. After six anti-trade union Acts, the unions cannot be blamed for the ghastly state of the British economy. Given the current state of the labour market, trade unions are more necessary than ever to give workers some protection and some rights in the workplace. Our people now recognise that: public opinion polls show that the unions are very popular and that workers want the protection that they afford.
    This mean, spiteful, malicious amendment is a disgrace to Parliament. If it is passed, I hope that a future Labour Government will give priority to its repeal.
    5.45 pm
    Mr. Nicholls: Let me begin by declaring my interests in Hill and Smith Holdings, the NSCC, Port Enterprises Ltd., the Waterfront Partnership, the Howard de Walden Estates, MinOtels and Dunn and Baker.
    The theme that runs through this debate is what the Conservative Government have tried to do in the trade union legislations that they have enacted since 1979. Although it seems narrow, the amendment raises some fundamental questions, as was pointed out by both the hon. Member for Holborn and St. Pancras (Mr. Dobson) and my hon. Friend—as he wishes me to call him—the Member for Eltham (Mr. Bottomley).
    The debate has featured at least one red herring. There has been disagreement about whether the law is being clarified or changed. Obviously, to some extent, one man's change in the law is another's clarification; however, I see nothing wrong in saying that, although it is clear that the legislators originally intended the law to operate in a certain way, the law has now been found not to be operating in that way. At that stage, the House will need to make a decision. The circumstances are not unique, but relatively common. The House must say, "If that is the way in which the words come across literally, and it is not what we intended, we must take steps. Shall we accept that the law must he thus—although we never thought that it should be—or shall we change it?"
    Usually, when such circumstances arise, Ministers are consulted. They normally reply that, if a suitable legislative vehicle existed, they might be able to do something; but such a vehicle can rarely be found when a clarification of the law is thought necessary. It just so happened that a Bill was going through the House whose long title suggested that it might be suitable: I see nothing wrong in principle with saying, "For once we have a suitable vehicle. Let us take advantage of it."
    Mr. Peter Bottomley: I shall try not to intervene again, but my hon. Friend may be able to help me on the question of what the law was thought to be. I have failed to find any reference in any of the personnel management books and loose-leaf binders, or in any decisions made by industrial tribunals, employment appeal tribunals or the Court of Appeal, that suggests that those decisions came as a surprise. What makes my hon. Friend believe that the people involved considered it possible to negate the benefits of union membership without offending against subsection (1)(a) of what was section 23 of the 1978 Act?
    Mr. Nicholls: I cannot begin to aspire to my hon. Friend's command of the sections and subsections. Moreover, it is clear that he has thoroughly researched the case law in the hope that it can help him with a particular proposition.
    When the law is thought to be settled and definite, nothing can be found in case law, because the practitioners have made a correct assumption. What does happen from time to time is that, even when the legislation is believed to be operating in a certain way, it then goes to be tested in one court or another, and it turns out that what was thought to have been settled has not been settled after all.
    The Minister of State, Department of Employment (Mr. Michael Forsyth): It may help the House if I explain that the employment appeal tribunal said that the section
    "has caused and may well continue to cause problems … We share the difficulties which this Industrial Tribunal found in the wording of section 23(1)(a)."
    Mr. Nicholls: It was wrong.
    Mr. Forsyth: What was asked for was an indication of who had said that there was some difficulty in understanding the law.
    Mr. Nicholls: What my hon. Friend the Minister has said is a perfectly correct statement of what the law's approach would have been in a situation such as this.
    In effect, we have three tribunals. We have the tribunal of first instance—the industrial tribunal—the employment appeal tribunal and then the Court of Appeal. If three such tribunals can come to differing conclusions, whatever the law might be, it is obvious that it is far from clear, and that it needs to be clarified. The fact that that difficulty had not arisen before proves the point precisely. It was thought to be settled, there was a disagreement between the three tribunals, and it needs to be clarified.
    Mr. Heald: Does my hon. Friend agree that the employment appeal tribunal is the most knowledgeable and skilled tribunal of any in this area, because it consists of a chairman who is a High Court judge and who handles those cases day in, day out, and representatives from both sides of industry? Will my hon. Friend accept from me, as a lawyer who was advising people on these issues at the time, that there was considerable complexity involved?
    Mr. Nicholls: That is right. I too used to do a considerable amount of industrial relations law. I will probably be in hot water with the Court of Appeal if I say that if one is looking at a thorough working through of the complex issues involved, the employment appeal tribunal usually provides better guidance than most.
    The plain fact is that, if three tribunals cannot agree, whatever else one might say about the law, it is not clear.
    Mr. Alex Carlile: Before the hon. Gentleman took on all those impressive parliamentary consultancies that he mentioned, I understand that he used to practise as a solicitor. Does he not think that it might have been wiser for the Government to wait for a determination of the issue by the House of Lords before rushing headlong into this new legislation, or does he think that the employment appeal tribunal is a more useful guide to these issues than the House of Lords, which is the highest court in the country?
    Mr. Nicholls: The hon. and learned Gentleman's deference as a silk to the House of Lords is truly
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    impressive. I dealt with that point a moment ago. Even if the matter had gone to the House of Lords and it had decided one way or another, two things would still be apparent. First, it would be apparent that there had been a difference of opinion about the state of the law as it passed through the various appellate processes—so to say that the law was clear would not have been true; secondly, the House would still have had to return to the question whether it believed that the effect of the law should be as the courts have decided.
    At that stage, one has to look for an appropriate vehicle to change the law and, by then, the vehicle may well have gone on. There was a clear difference of opinion among the various tribunals, and the House now has an opportunity to say whether the law should be clarified in the way in which it was always thought that it would be interpreted. That is the proposition, and there is nothing wrong with it.
    The point of principle underlying this amendment is what we are in the business of doing. The hon. Member for Holborn and St. Pancras (Mr. Dobson) dealt with his point of principle somewhat late in his speech, but with engaging frankness. He stated baldly that this is about the belief that more trade unions would be good for employees. It is a perfectly reasonable proposition, and for somebody who is sponsored by a trade union it is probably a predictable and inevitable conclusion to reach. However, should the House believe that more trade unions would automatically be a good idea for the people of this country and for employees? I do not necessarily see it that way.
    This legislation is not anti-trade union. How could it be anti-trade union, when it is from a Government who enacted the right not to be refused employment on the basis of trade union membership? It is worth reminding ourselves that it was a Conservative Government who introduced that legislation.
    We know that the Labour party is opposed to this amendment. How long will that opposition last? The background to this has included five employment Bills, and we should look at the things that the Labour party has opposed to the rooftops. It has opposed secret ballots before the election of trade union officers, secondary picketing, secondary action, pre-strike ballots and the idea of a postal ballot. It is not long ago that it was opposing to the nth degree the idea that the closed shop—that monstrosity—should be abolished.
    In due course, the Labour party suddenly decided that it was not against all those things after all. We must look at this proposition in that light. It would be entirely inconsistent for a Government to enshrine in law the idea that one should not be refused employment because of trade union membership and then to indulge in this piece of legislation if it satisfied the description given by Opposition Members.
    Of course trade unions should be entitled to combine in their own interests. However, recognition is a matter for trade union members. It cannot be right for them to impose recognition on employers simply because trade unions decide that that is what they want. I apologise if, in a misplaced attempt at humour, I upset my hon. Friend the Member for Eltham, but, as one Conservative to another, I find it difficult to see how one can go along with the idea that a trade unionist should be entitled to impose recognition on an employer.
    That cannot possibly be right. It must be up to an employer who owns, runs and knows his business to decide

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    whether to recognise a trade union for particular purposes. My hon. Friend the Member for Eltham obviously finds that a bizarre proposition; I do not.
    Mr. Leighton: It is not about whether an employer can derecognise, because, under the law, he can. The judge has said that he should not offer a bribe to a certain section of workers to do so.
    Mr. Nicholls: The hon. Gentleman can put it in those terms if he wishes.
    Mr. Leighton: It was not me—it was the judge.
    Mr. Nicholls: One of the things that we are trying to cope with today is the fact that different judges and three different tribunals see things—
    Mr. Leighton: Three judges.
    Mr. Nicholls: It is touching to see the Labour party say how much it wants to support judges. The Labour party supports judges only when they say what it wants them to say. The hon. Gentleman is being highly selective in the judges that he is prepared to agree with. It is tempting to wish that it would go to the House of Lords—I say this in a moment of jocularity—simply so that he might have to come back in due course and say how much he supports the judges in the House of Lords.
    There is an ambiguity, and it needs to be clarified. This is about the proposition advanced by the Opposition and my hon. Friend the Member for Eltham—that, once trade union members decide that they wish to be collectively responsible, it should be imposed on employers, and that any paid differentials which come about can be dismissed as a bribe or a douceur. The thread running through this issue is not that more trade unions are good, but that it should be open to the people involved to make up their own minds—that includes employers—whether they will accept the recognition that unions may demand of them in a particular situation. I do not find that an ignoble principle—it is a theme that has run through our legislation since 1979.
    When my hon. Friend the Member for Eltham and I were members of the Government together, trade union legislation was being passed. My hon. Friend had day-to-day responsibility for trade union matters, as I also did for a time. Perhaps we can agree on one thing. When I saw the themes running through such legislation, I did not feel that I as a Minister was being asked to do something so appalling that I should resign. Hearing my hon. Friend speak, with some eloquence, I wonder how he managed to stay on board at times if he felt so strongly about the legislation that we were introducing.
    6 pm
    Mr. Peter Bottomley rose
    Mr. Nicholls: I shall now give my hon. Friend the opportunity to make the resignation speech that he denied himself at the time.
    Mr. Bottomley: First, I do not recall industrial relations legislation being passed when I was a Minister at the Department of Employment, although my memory may be at fault. Secondly, nor do I recall in the first 14 years of Conservative government any proposal to change the law
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    so as to negate completely the benefits of union membership, in flat contradiction of section 23(1)(a)— the industrial tribunal's finding of fact.
    Mr. Nicholls: Let me cheer up my hon. Friend at once. If he is casting his mind back to find out when he was an Employment Minister, I can tell him that it was between September 1984 and January 1986. Mercifully, I can agree that, at that precise point in time, no employment legislation received the force of law. If he wants to point out that he voted against employment legislation when he was in another Department and somehow remained a member of the Government, I shall accept what he says.
    However, my hon. Friend is making a serious point, which needs to be dealt with. The amendment will not negate all the benefits of being in a trade union. We are all aware of examples of people being members of trade unions and presumably paying their dues willingly, but their employer is not able to negotiate their pay. My hon. Friend might believe that the only benefit of being in a trade union is the ability to negotiate pay, but there is much more to it than that.
    Mr. Thomas Graham: Does not the hon. Gentleman realise that the Government are in the business of improving industrial relations, but that the legislation is a recipe for disaster? I do not know whether the hon. Gentleman has ever worked in a factory alongside people who are members of a different union. What happens if one person earns £2 an hour more than another for exactly the same work merely because he is not in a trade union? Surely no hon. Member could accept such a situation in British industry.
    Mr. Nicholls: The hon. Gentleman speaks with great sincerity, but I should have more sympathy with what he is saying and be more likely to agree if, since 1979, the Opposition had not opposed every trade union reform that we have introduced. The Labour party's position on all our trade union reforms has been that it agrees with the reform before last, is not quite sure about the last one and believes that the present one is an outrage. That is the way the party presented itself to the electorate.
    In a practical sense, I accept what the hon. Gentleman says. Such a situation might cause difficulties, but working life is difficult. Is he leaping from that proposition to saying that the state should be in the business of fettering an employer and stopping him offering a salary structure which he finds makes his business work? If the hon. Gentleman believes that, he would impose a restriction on employers and businesses and prevent them from offering jobs which last and succeed.
    In the end, the one thing that unites—or should unite —all parties, although I sometimes wonder whether it does, is that we want businesses to succeed. That is what the amendment is all about, and that is why it is entirely right.
    Mr. Alex Carlile: When the hon. Member for Teignbridge (Mr. Nicholls) began his speech, he read out what sounded like a litany of private consultancies that he holds. If he were told by you, Mr. Deputy Speaker, or by those who have such authority that, because of those consultancies, they would deduct all the money that he receives as a consultant from his salary as a Member of the

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    House plus one penny piece, I bet my bottom dollar that he would give up those consultancies in a flash. This proposal is about something very similar.
    The proposal is an attempt to bribe or, to use the words of Lord Justice Dillon, to offer a douceur, or sweetener, to union members. It is not a sweetener to try to persuade them not to be members of a trade union—their right to be in a trade union remains, of course, enshrined in law—but it is an attempt to allow employers to offer a sweetener to make employees unable to exercise their rights as members of a trade union. That is offensive.
    I regret that it was far from a privilege to listen to the hon. Member for Teignbridge when compared with the speech made by the hon. Member for Eltham (Mr. Bottomley). It was a privilege to listen to the hon. Member for Eltham because I believe—I hope that the Minister of State will reflect on this—that it represented the authentic voice of trade unionists who do vote or have voted for the Conservatives. I believe that Conservative trade unionists will find this proposal as offensive as trade unionists who vote for any Opposition party. The Government have signally failed to recognise that, perhaps because of the indecent speed with which the proposal was inserted in the Bill in another place.
    The amendment makes doubtfully proper use of both Houses of Parliament. It is insupportable to suggest that it could be regarded as just; and its legality is questionable in the context of international law.
    As for the propriety of their use of the House and of another place, I wonder why the Government thought it proper to introduce the clause with indecent haste when it was known that the employers who lost in the Court of Appeal were intent on going to the House of Lords on appeal. Why have not the Government waited for the determination of the House of Lords? Why have they sought to diminish the courts, which, in other contexts, they seek— or pretend to seek—to support?
    The appeal decision was not the idiosyncratic decision of a radical who had accidentally found his way into the Court of Appeal. It was the unanimous decision of Lord Justice Dillon, Lord Justice Butler-Sloss and Lord Justice Farquharson, two men and one woman who are very experienced in the application of employment law, lawyers of eminence and brilliance who were not taken by surprise in having to reach such a finding.
    Why do the Government seek to arrogate to themselves the role of a legislative Court of Appeal when the appellate remedies provided by our courts system have not been exhausted? Is it a precedent for the future? If so, it is a fine demonstration of the fact, now accepted not only by my party but by the Labour party, that there is a need to write down some constitutional limits. It is a good example for the argument that it is high time that we had a constitutional court, or its equivalent, so that we are not driven to seek remedies from distant courts in the international arena in order to assert individual liberties and rights.
    How can the Government say that they were taken by surprise by the view expressed by the Court of Appeal and the industrial tribunal in the two cases involved? Where did the Government get their legal advice and what legal advice did they obtain? I ask the Minister of State to tell us when he answers the debate where in the past the
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    Government obtained the legal advice that left them so surprised by the findings of the Court of Appeal. They certainly did not go to John Hendy QC, one of the leading employment lawyers in the country, who appeared for Mr. Wilson before the Court of Appeal. Had they done so, they would have found it far from surprising that the Court of Appeal should reach that conclusion. I do not pretend to be an expert on the subject. but I can tell the Minister of State—perhaps the Department of Employment needs to learn this—that there are plenty of employment lawyers apart from Mr. Hendy who have long believed that the decision of the Court of Appeal on behalf of Mr. Wilson and in the other case that has been mentioned were entirely predictable and were an application of the law as it was understood.
    The hon. Member for Wallasey (Ms Eagle), who speaks in the House on employment issues with great skill and authority, referred earlier to the decision of the employment appeal tribunal—that, at least, should appeal to the hon. Member for Teignbridge—in the case of Discount Tobacco and Confectionery Ltd. v. Armitage, which was reached in 1990, nearly three years ago, and publicly reported in the "Industrial Relations Law Reports" for 1990 at page 15 onwards. Mr. Justice Knox, giving the judgment of the tribunal, said that it would "emasculate"—that is a strong word—our understanding in this country of the right to be a member of a trade union if it could be successfully argued that there was a distinction to be drawn between membership of the union and resorting to the services of a union officer to elucidate and negotiate the terms of employment. He said that the right to be a member of a trade union
    "would he reduced almost to vanishing point"
    if that distinction, which was argued for in the case but rejected, were to exist in law. He continued:
    "it would only be just the fact that a person was a member of a union without regard to the consequences of that membership that would he the subject matter of that statutory provision, and it sems to us that to construe that paragraph so narrowly would really be to emasculate the provision altogether".
    In Mr. Wilson's case Lord Justice Dillon said that that judgment was "unquestionably correct". Lord Justice Dillon did not seem to think that the interpretation had been questioned in the period between the Armitage case and the decision in the Wilson case.
    Mr. Nicholls rose—
    Mr. Carlile: I shall give way in a moment.
    Why do the Government claim surprise, when they knew the effect of the decision in the Armitage case? If they had considered the effect of Armitage at all they could only have concluded that the law was as Lord Justice Dillon declared it to be. In my view, for the Government to say that they were taken by surprise is a pretence. I do not accept for one moment that that was the sincerely held view of the Government when Lord Ullswater spoke, or that it is their view now.
    Mr. Nicholls: The hon. and learned Gentleman defends his fellow judges with passion and sincerity. So that we can understand where he and his party stand on the matter, will he tell me whether he supports the right of a trade union to be recognised for collective bargaining purposes in a company if it represents a significant proportion of the relevant part of the work force, even if the employers do not wish to recognise it?
    6.15 pm
    Mr. Carlile: I believe that the law must fall within article 11 of the European convention on human rights, as I shall explain in a moment.
    Mr. Nicholls: Answer the question.
    Mr. Carlile: If the hon. Gentleman is more patient than usual, he will see that his question will be answered in due time.
    Now I turn to whether the proposal can be regarded as just. How could it possibly be regarded as just, or as fair? Again, we must consider the words of Lord Justice Dillon. Whether we talk about a douceur, a sweetener or a bribe —call it what you will, Mr. Deputy Speaker—that is the effect of the measure. It is intended to allow an employer to offer a sweetener to emasculate the effect of being a trade union member.
    The Secretary of State said that, unless what an employer did was reasonable, he would not get away with it. However—inadvertently, I am sure—the right hon. Gentleman misrepresented what the new provision says. I refer the Minister of State to subsection (3)(a) of the new clause, which would provide that the purpose for which the employer took the relevant action would be regarded as having been taken
    "to further a change in his relationship with all or any class of his employees".
    The employer's action would be valid unless the tribunal considered
    "that the action was such as no reasonable employer would take".
    So it is not for the employer to prove that his action was reasonable; the burden is on the employee to prove that no reasonable employer in the land could reasonably have taken such action. That is a heavy burden, quite different from the Secretary of State's explanation.
    Furthermore, that is not the end of the matter.
    Subsection (3) also says:
    "the tribunal shall regard the purpose mentioned in paragraph (a) … as the purpose for which the employer took the action, unless it considers that the action was such as no reasonable employer would take".
    It then adds the words:
    "having regard to the purpose mentioned in paragraph (a)."
    That means that so long as the employer's purpose was
    "to further a change in his relationship with all or any class of his employees".
    his action is most unlikely to be regarded as unreasonable. The courts will have to consider the meaning of that last part of the proviso to subsection (3).
    If my understanding of the provision is wrong, I ask the Minister of State, when he replies to the debate, to tell me why. At the very least, will he explain to the House why the words
    "having regard to the purpose mentioned in paragraph (a)"
    are contained in the subsection and what they mean? He probably knows that since a recent decision, the courts may have regard to what Ministers say in the House. I believe that the courts will be extremely puzzled by the words that I have quoted unless the Minister gives some clarification, no doubt based on advice, of what they mean. A failure to give such clarification will be regarded by me—and, I suspect, by others—as deliberate and as an acceptance of the fact that the Government are trying to circumscribe even the test of reasonableness.
    Finally, is what the Government propose legal? Did the Government take independent legal advice as to whether
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    the proposal is legal in terms of their obligations in international law? Will the Minister at least tell us whether they obtained advice from the Attorney-General as to whether the measure was consistent with those obligations? In particular, on what basis do the Government argue that their proposal falls within article 11 of the European convention on human rights? The words of Mr. Justice Knox in the Armitage case, which I quoted earlier, will remain good domestic law, even after the implementation of this proposal. Mr. Justice Knox's judgment makes it quite clear that to circumscribe the rights appurtenant to trade union membership is to restrict the right to trade union membership itself.
    I do not know whether the Minister of State has ever read article 11 of the European convention on human rights. The convention is only a little book—even the Minister could read it before bedtime. Paragraph 2 of article 11, so far as it is relevant, says:
    "No restrictions shall be placed on the exercise of these rights other than such as are prescribed by law and are necessary in a democratic society in the interests of national security or public safety, for the prevention of disorder or crime, for the protection of health of morals or for the protection of the rights and freedoms of others."
    How can the Government say that this provision does not amount to a restriction on the exercise of the right to membership of a trade union? How can they claim that it is necessary in a democratic society? Do they say that it is necessary for the protection of public morals or to prevent disorder or crime? Certainly they cannot, with any justification, claim that it will protect the rights and freedom of others.
    I know that the Minister of State is not enthusiastic about international organisations, although in this regard he sometimes tries to hide his fire under a bushel. Even so, he must agree that it is very important that the House of Commons should not demonstrate contempt for international law. Have the Government considered the international law implications of what they are doing? I believe that they may have failed to do so. If they have, I believe that they have got it wrong and I ask them to reconsider their position.
    Mr. James Paice: I should like to begin by declaring interests in Dixons plc, the British Fibreboard Association, the National Training Federation, United Framlingham Farmers Ltd. and Writtle College.
    I listened with great care to the speech of the hon. Member for Holborn and St. Pancras (Mr. Dobson), who opened for the Opposition. The hon. Gentleman twice mentioned dates. He quoted words of Winston Churchill dating back to 1908, and he made use of the fact that one of the agreements referred to in the two cases from which this amendment springs dates from 1912. Surely that shows that it is time for a re-examination of the issue. By quoting from legislation and agreements drawn up at the beginning of the century, when we are within seven years of its end, the hon. Gentleman showed that he is one of the unreconstructed members of the Labour party.
    In my view, the significant aspect of this matter is the need for employers to be flexible. As was said during Prime Minister's Question Time today, we are in a highly international competitive, single world market. We are competing not just with the town or city up the motorway, or even with France, but with the rest of the world. Thus, it is absolutely essential that employers be sufficiently

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    flexible to meet all needs. A bitter truth that we sometimes delude ourselves into refusing to accept is that industry and commerce do not exist for the purpose of providing jobs. Businesses exist for the purpose of engaging in economic activity, which provides people with work. When the activity ceases to be economic, the work disappears. Indeed, we have seen the disappearance of too many jobs in those circumstances.
    I do not believe, and I do not make the case, that every employer in this country is perfect. There are some very bad employers. [HON. MEMBERS: "Hear, hear."] I am the first to recognise that fact, but I dissent strongly from the view, which I suspect is held by those who are momentarily supporting my words, that that law can be used to correct all the bad practices of employers. It is the sharp teeth of competition that encourages employers to adopt good employment practices and, thereby, minimise disruption and maximise productivity.
    Before becoming a Member of Parliament I spent some time in training and management development. With that experience, I believe very strongly that it is in the interests of all employers to adopt employment practices that minimise disruption, minimise the number of employees who leave, and maximise the ability of everyone to contribute, to develop personal skills and to be rewarded for doing so. Otherwise, businesses fold under the pressures of competition. But it is for the employer to decide how these issues should be addressed; it is not for this House to legislate.
    I support the principle of minimum employment protection legislation, but this amendment is giving employers flexibility to amend their arrangements with individual employees to meet their needs.
    Ms. Eagle: I have been listening with interest to the hon. Gentleman's comments about international competition and the pressure that it puts on those who organise industry in this country. Will the hon. Gentleman admit that when all restaints are removed, by virtue of the fact that there are minimum employment rights and there is no trade union organisation, competition is achieved by lowering wages, by introducing terms and conditions that exploit employees and by generally impoverishing the work force, whereas it should be achieved by having good research and development, good sales techniques and high-quality products?
    Mr. Paice: High-quality research and development and products are obviously vital in any market. I do not accept, however, that low wages are necessary to the achievement of maximum competitiveness. What matters is not the amount of money that is paid to the individual but what each unit of production costs. Into that equation must go the whole question of investment in technology —machinery and whatever else is required for production —as well as the overlaying costs of employment, the social chapter and work force flexibility. I do not accept that low unit costs can be achieved simply by reducing wages. Unit costs, rather than the number of pounds that an employer receives per week, are the key to competitiveness.
    As I have already said, I am the first to accept that there are bad employers who seek to achieve competitiveness by lowering rates of pay. In the long run, however, such employers are doomed to defeat because they are ducking
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    the key issues. If they pay too low a wage. they will have problems with their work force. Their staff will be discontented and many of them will leave to go to other jobs for better wages. Ultimately, such behaviour will cost employers money and cause them to wish that they had adopted more advanced and sensible employment practices.
    6.30 pm
    Mr. Graham: How in God's name can we ensure good industrial relations if we introduce an amendment that will divide the work force by enabling employers to say, "If you are not a member of a trade union, we will pay you extra"? How can that create better employment relations in Great Britain and get Britain back to producing goods? It makes no sense deliberately to divide the work force in that way, and it seems to me that the Government are wasting the time of the House with their mad and stupid measures.
    Mr. Paice: Clearly there is a difference of opinion as to what the amendment does. I do not believe that it will necessarily divide the work force as the hon. Gentleman suggests. I agree with the point that he made in an intervention in the remarks of my hon. Friend the Member for Teignbridge (Mr. Nicholls), which was that the concept of two people who work alongside each other doing an identical job but earning different rates of pay is bound to lead to discontent. But the amendment refers to the tribunal regarding the purpose mentioned in paragraph (b) as the purpose for which the employer took the action
    "unless it considers that the action was such as no reasonable employer would take having regard to the purpose mentioned in paragraph (a)"
    I submit that no reasonable employer would embark on a course of action that would lead to two people doing identical jobs being paid different rates.
    Mr. Dennis Turner: Where has the hon. Gentleman been these last few years? He talks about good and bad employers. Is he not aware that in Britain today thousands upon thousands of working people are being subjected to injustice every day of their working lives? There are bad employers who are making people redundant or placing them on temporary contracts. People are starting one day and being sacked the next. They receive no unemployment pay and no sickness benefit and have no rights whatever. People are working in those circumstances because they are in fear of the legislation that the Government have introduced. Why cannot the hon. Gentleman see that the Bill and the amendment will exacerbate the problems with which working people are already faced?
    Mr. Paice: The hon. Gentleman was not listening to what I said. I said quite clearly that I accept that there are bad employers in this country—although I suggest that redundancies are more likely to be the result of the economic circumstances facing a particular business at a particular time than the mark of a bad employer. I do not believe that the amendment would have the effect that the hon. Gentleman believes it would.
    In addition to the importance of competitiveness to which I referred earlier, it must be remembered that the whole concept of working practices is changing fast—not only because of the international situation but because of people's changing priorities and desires. I refer, for

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    example, to the development of part-time work, which is often sought by employees rather than imposed by companies. The attitude to weekends—and, dare I say it, Sundays—is changing. Some mothers wish to work for only a few hours a day while their children are at school. Such developments have caused British businesses to consider more flexible working arrangements. Employers therefore need to be more flexible.
    We have moved away from the situation that pertained 20 or 30 years ago when massed ranks of people, all of them doing identical jobs, came out of the factories. Of course such businesses still exist, but they are changing fast. The vast majority of people are now employed in much smaller companies and there is a much greater range of responsibilities and job functions within those companies. That is why I believe that the flexibility embodied in the amendment is essential.
    Mr. Jimmy Boyce: Does not the hon. Gentleman realise that what he is saying would ring more true if the proposals included protection against the bad employers whom he recognises exist? We could accept much of the hon. Gentleman's argument if the proposals encompassed such protection, but in fact the opposite is the case.
    Mr. Paice: No. The minimum legislation to which I referred is already in place. We are discussing a particular amendment today, but a number of employment Acts have been introduced during the Government's term of office. Those Acts have drawn the sting from the impositions made by Labour and other Governments on employers while leaving in place the minimum standards of employment protection that I believe are essential.
    Mr. Eric Clarke: I have spent much of my life negotiating deals nationally with nationalised industry. An important aspect of such negotiations was the discipline that we could bring to the negotiating table. Is the hon. Gentleman aware that it is easy for a major employer to discuss with the trade union movement? I have also spent my life negotiating and discussing with my members the deals that have been reached. We had to sell them the idea. The argument is that it is easier that way. Moreover, it was good for industry and good for production. One had a sense of fairness. Everyone knew exactly where he stood.
    The hon. Gentleman seeks to turn the clock back. He suggests that the amendment is fair because it gives the employer a better deal, but employees are not getting a better deal, are they? No one in the House could sell that argument to a group of people—
    Madam Deputy Speaker (Dame Janet Fookes): Order. The hon. Gentleman is now making a speech.
    Mr. Clarke: Can I just say—
    Madam Deputy Speaker: No. That is enough.
    Mr. Paice: The hon. Gentleman talks about reasonable employers and about benefits to employees. It is a sad reflection on our society that we still refer to employers and employees as if they were on opposing sides. I accept what the hon. Gentleman said about the benefits of trade unions being able to negotiate on behalf of a number of members and to reach agreement with the management of a nationalised industry—although I suggest that nationalised industries are perhaps not the best examples of
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    the success of the process—and then to go back and sell to their members the benefits of a package that has been negotiated.
    I do not think that I have ever said anything in my political life to suggest that I do not support the principle of trade unions or the right of employees to belong to trade unions if they so wish. I do, indeed, believe in those principles. I also believe, however, that it is in the interests of employers to be able to adjust their bargaining arrangements with individual employees to meet the needs not only of their business but of those employees, who may wish to work certain hours, undertake certain training and so on. A whole gamut of factors now comes into play.
    We are not today faced with a situation in which everybody in a business works the same number of hours doing the same job. That was commonplace years ago. In the evolving world of the last decade of this century and into the next, every employer who wants to achieve the competitiveness that is required and wishes to meet the aspirations of many of his employees must have the flexibility that the amendment provides.
    Ms Jean Corston: I am grateful for the opportunity to speak in the debate. I agree with my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) that the amendment will ensure, in the employment context, that all forms of bribery and coercion will be lawful. It is a spiteful amendment which will undermine the rights of trade union members.
    It is also an affront to normal parliamentary procedure in the manner of its introduction, for it represents an amendment of settled law. It will have the effect of negating trade union membership. It is clear that parties to the action would seek recourse to the House of Lords, which is supposed to be the highest judicial authority in the land and the decisions of which are binding on all lower courts, including the employment appeal tribunal. Those facts must be within the knowledge of the hon. Member for Teignbridge (Mr. Nicholls), who is a practising solicitor.
    The Conservative party says that it is not against trade union membership. Conservative Ministers have said over the years, while introducing one piece of repressive legislation after another, that they were simply giving unions back to their members.
    Labour Members see the legislation for what it is—an attempt to turn the industrial relations clock back to 1906. I make no apology for mentioning that date because if Conservative Members could find a way round the immunity from prosecution for torts committed in contemplation or furtherance of a trade dispute, I am sure that they would do so.
    The amendment will ensure that trade union membership will be positively discouraged. Individuals will face the choice of accepting a pay cut or signing a new personal contract. That will happen under coercion and, in the process, they will be required to surrender the right to union representation. Such a choice cannot be said to extend the rights of employees. We recall that the Conservative manifesto of 1992 stated:
    "We will take measures to give individuals greater freedom in choosing a union."
    Instead, the amendment will give employers greater freedom to take vindictive action against trade union members. Nowhere was that better illustrated than in a company called J. W. Arrowsmith Ltd of Bristol. The

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    factory is located in the constituency of my hon. Friend the Member for Bristol, South (Ms Primarolo), though many of the employees live in my constituency.
    Arrowsmith was a well-established printing company with no history of industrial unrest. There was never a strike, although there was a lock-out 13 years ago over a pay claim. But in 1988, employees were asked to take a pay cut of between 20 and 25 per cent., representing about £50 a week for most crafts people. That was agreed, to save the company.
    Early in 1991, the company decided to discontinue the national agreements between the BPIF, the British Printing Industries Federation, which represented the employers, and the GPMU, the Graphical, Printing and Media Union, which represented the work force. That was supposed to take effect on 1 January 1992, and obviously it meant having an in-house agreement. So there was at least an element of collectivism in that there was an agreement between the people employed and the employer.
    The company refused to enter into negotiations at the end of 1992 for the 1993 agreement, saying that it could not afford an increase because of the high cost of overtime. The company then reneged on a holiday pay agreement. In April, the GPMU decided to involve the company in the national pay claim, which was for £6·05 a week on basic pay and an extra day's holiday. That would have represented just under 3 per cent. The company refused that claim, so there was a dispute. Most other companies in the BPIF signed.
    6.45 pm
    In accordance with Conservative-initiated legislation, a legal ballot was held and, by 98 to 14, it was agreed that industrial action short of a strike would be undertaken. They decided on a work to rule, the effect of which was that no overtime would be worked. One would have expected the employer to be pleased about that. After all, one of its reasons for not giving a pay rise was that overtime cost so much.
    Three days later, the company issued a warning letter. It concerned anybody going on strike or doing anything outside the terms of a contract of employment collectively negotiated and agreed. The warning letter was followed on 26 April by departmental meetings addressed by Victoria Arrowsmith-Brown who, for all purposes, was the employer, informing them that if they did not sign a letter dissociating themselves from the action, they would be dismissed. They then received dismissal notices.
    Hon. Members will find the terms of the dismissal notice interesting, bearing in mind the amendment that is before the House. The dismissal letter said:
    "Industrial action short of a strike commenced on Thursday April 22 and you were asked to dissociate yourself from it and to give an undertaking that you would not participate in it. You declined to do that and you have therefore participated in industrial action which has disrupted production. By participating in that industrial action you have been, and still are, in repudiatory breach of your contract of employment. The company accepts your breach as terminating your employment with immediate effect. It is also accepting breaches of contract by other employees who have also been, and are, participating in industrial action, as terminating their employment. Your employment having ended, your form P45 and any money due to you will follow shortly."
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    The same notices were issued to staff who were absent through sickness, to those on holiday, to women on maternity leave and to an employee who had given 43 years' service and was due to retire the following day.
    The following day, the workers were locked out. On 1 May they received new contracts containing similar pay rates to the previous year, a pay freeze for two years, lower overtime rates, lower shift rates and—a real sticking point—no recognition of any trade union and no representation by a trade union. The deadline for signing was 14 May. Three members of the trade union signed and returned to work. One other returned on 24 May, and he is on a three-month contract terminable at one day's notice.
    It is important to remember that the company told employees on 1 May, when they were offered new contracts, that the company was willing to employ them only on the terms and conditions of employment which I summarised. The letter went on:
    "No other terms and conditions will form part of your contract and, in particular, no term in any collective agreement which may have been reached by, or on behalf of, the Company with any union representing you will form part of the contract which is now being offered to you."
    It went on to make it clear that the contract was exclusively individual.
    As a result of the amendment that we are debating, Arrowsmith—assuming that it is a bad employer—would be able lawfully to differentiate between employees in terms of rates of pay. To date, the company has lost several contracts, many more are threatened and production is virtually nil. That employer seems to have had all the foresight and long-term planning of a Kamikaze pilot. The employees are not on strike, have never been on strike and have never threatened to strike.
    The whole tragic and scandalous story reveals the way in which Conservatives condone, even encourage, behaviour by employers that is in breach of all accepted civilised standards. What will be the result if the amendment—and the nods and winks that accompany it —becomes law? What will the future hold for people in Bristol who cannot get income support, who cannot get maternity fund payments through the social fund and who cannot receive unemployment pay, even though the letter that I quoted said that they were dismissed? The employer will not confirm to the Department of Employment that they have been dismissed.
    The effect of all that is that those people who at least understand what collective provision is about, and who are showing some form of support and solidarity to each other, will be able to be picked off because no one will refuse a pay rise at the end of the day.
    Mr. Paice: I know nothing about the specific case to which the hon. Lady refers. However, I suggest that taking an individual example is a poor basis for any legislative action. More importantly, has not the hon. Lady made my case for me? She said that, since the dispute has arisen, the company has lost many orders and production is virtually at a standstill. That spells a dismal future for the company. Does that not demonstrate my point that a good employer will recognise that he must operate in a way that minimises disruption? I am sorry that employees will suffer if the company goes to the wall. But the company will also suffer —it will pay the price for handling its work force badly.
    Ms Corston: The hon. Gentleman makes my point for me. If we were proceeding simply on the basis of one example, it would be outrageous. But that is exactly what we are doing—we are proceeding on the basis of what three learned judges, who are fully conversant with employment law, decided in one case. It is exactly the same as one example of an employer defying all of the decent standards. That is happening under the present law.
    What the Government are doing—I presume that the hon. Gentleman will condone this in the Lobby tonight —is making it easier to negate trade union membership by offering sweetners. We are used to seeing sweetners in legislation from the Conservative Government, but the Bill extends them so that workers can be set against other workers—workers alongside each other will get different pay rates.
    In terms of international labour obligations, the TUC said—and I agree with this—that the Government's action is in breach of International Labour Organisation convention No. 98, which provides for the right to organise and collective bargaining. The general principle of the convention is that no person should be prejudiced in his or her employment by reason of trade union membership or legitimate trade union activities. It is not simply a matter of a few bad employers because such behaviour undermines good employers—good employers can be undercut by those who pay below the agreed rates. What does that do for decent civilised standards and those companies which the hon. Gentleman considers to be good employers? It gives an employer a green light to treat his work force in that way.
    The amendment has implications for the whole economic well-being of our country. We continue to hear Conservative Members say that they want the recession to end. We all want the recession to end. We all welcome real signs of recovery, but that is based on confidence not only in the City but in every home. Confidence depends on the ability to plan for the foreseeable future. How can people take out a mortgage, buy a car or enter into a hire purchase agreement if they have a three-month contract that is determinable at one day's notice?
    It is time that the Government stopped substituting sound bites for sound policy. Conservative Members would do well to join the hon. Member for Eltham (Mr. Bottomley) in voting against the amendment tonight; otherwise they must accept that the Government's declaration of wanting a classless society that is at ease with itself and in which there is real choice for individuals is absolutely nothing but weasel words.
    Mr. Thurnham: This debate is certainly generating a great deal of light and heat. Most of the light is on the Conservative Benches, and most of the heat and confusion is on the Labour Benches.
    I warmly congratulate my right hon. Friend the Secretary of State on his new appointment. I am glad that he has been able to make his debut by speaking on this excellent Bill.
    I regret that I did not have the opportunity to speak earlier on this Bill or serve on the Standing Committee. I congratulate my hon. Friend the Minister on his role in taking the Bill through the Standing Committee and ensuring that it is the important and valuable Bill that it is.
    I am delighted that we have this amendment. The hon. Member for Holborn and St. Pancras (Mr. Dobson) said that it is a savage attack on freedom of association, but I
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    cannot see what could be more reasonable. The amendment as introduced by Viscount Ullswater is couched in reasonable terms. It says:
    "the tribunal shall regard the purpose mentioned … as the purpose for which the employer took the action, unless it considers that the action was such as no reasonable employer would take".
    I cannot understand how the amendment could be construed as it has been by Labour Members.
    I am sorry that my hon. Friend the Member for Eltham (Mr. Bottomley) is not here because I should like to take up sonic of his points. He said that he was not against individual contracts for senior people. I do not see why we must distinguish in that way and say that something is all right for senior people but not all right for other people. We should be able to have individual contracts right the way through. The whole purpose of the Bill is to ensure that employers and employees can reach individual bargaining arrangements. It in no way challenges the right of individuals to be members of a trade union.
    Mr. Michael Clapham: Does the hon. Gentleman accept that the Ullswater amendment gives not only the possibility of derecognising by virtue of individual contracts but the opportunity for employers to switch bargaining rights from one trade union to another trade union, thereby negating the freedom of choice of the employees whose bargaining rights are transferred?
    Mr. Thurnham: If the hon. Gentleman had waited, I was about to come to that point. The law was never meant to interfere with the decisions of employers on what bargaining arrangements best meet their requirements. It is an employer's right to decide, in the light of the needs and circumstances of his business, how he wants to negotiate with his staff. The law should not put obstacles in the way of employers who want to move from collective bargaining and introduce individual pay negotiations and personal contracts.
    The hon. and learned Member for Montgomery (Mr. Carlile) seemed to advocate—it was clear that he is a member of the legal profession—that people should continue to appeal at enormous cost and, undoubtedly, generate a lawyer's beanfeast rather than have the Government do what is obviously sensible and clarify the law as quickly as possible, in view of the fact that some doubt has arisen. My hon. Friend the Member for Romford (Sir M. Neubert) said that the Labour party is paid for by the trade unions.
    The hon. Member for Holborn and St. Pancras told us about his grandfather and his father and went into the history of legislation going back to 1912. That legislation is all antique—it is not relevant to the modern world. He referred to Japan. I wonder whether he has had an opportunity to read "The Machine that Changed the World", which makes it clear that individual arrangements can lead to much higher productivity figures. The hon. Gentleman is looking strained.
    Mr. Dobson: Does the hon. Gentleman accept that, generally speaking, productivity in German industry is greater than it is here and that the value of exports of manufactured goods per head of population is considerably higher in Germany than it is here? Does he also accept that it is exceedingly commonplace for there to be

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    collective bargaining in German industry? The Germans believe that it enhances productivity and efficiency, and all the evidence shows that it does.
    Mr. Thurnham: There is higher productivity in organisations all round the world where employers and employees are free to negotiate agreements to their own advantage. I recommend that the hon. Gentleman should go along the Corridor to the Library, ask for a copy of the "Machine that Changed the World" and read it. It was written by three lecturers from the Massachusetts Institute of Technology and paid for by this Government, the American Government and others in order to find out what happened in Japan. It is remarkable how it shows improvements in productivity.
    7 pm
    The hon. Gentleman, when opening for the Opposition, cited the docks industry and the old Fleet street printing industry, as if they were examples of exactly what we should have. Those industries were riddled with restrictive practices and the hon. Gentleman voted against every piece of legislation introduced by this Government to clear out those practices. Perhaps he will say now whether he has changed his mind about his opposition to that legislation which has helped to make this country so much more productive now than it ever was in the past. [Laughter.] It is not a laughing matter.
    Mr. Dobson: Will the hon. Gentleman give way?
    Mr. Thurnham: No. The docks were riddled with restrictive practices, yet the hon. Gentleman did not support the Government's legislation to sort them out. How could the country achieve the necessary productivity and international trade if—
    Mr. Terry Lewis: Will the hon. Gentleman give way?
    Mr. Thurnham: The hon. Gentleman has just walked into the Chamber, so I suggest that he sits down and listens to the debate—
    Mr. Lewis: Give way.
    Mr. Thurnham:—rather than going on any longer.
    Mr. Lewis: Give way.
    Madam Deputy Speaker: Order. Members know quite well that if the Member who has the Floor does not give way they must resume their seat.
    Mr. Thurnham: Thank you, Madam Deputy Speaker. It is reprehensible for Opposition Members to wander into the debate and try to intervene when they have not been here throughout the debate to listen to the points being made.
    The hon. Member for Holborn and St. Pancras spoke about the Daily Mail. Perhaps he should remember the old Daily Herald. Was it not that newspaper that the Labour party wanted to see exist? He forgets that newspapers are bought by individuals. It is an individual contract, so to speak, when individuals buy newspapers. That must run throughout industry. Industry must rely on individual
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    agreements. Newspapers are bought by individuals who decide to buy them. In the same way, an employer should be free to pay more or less for an employee.
    The Labour party forgets that the amendment is all about pay increases. Labour Members want to level people down to the levels that they would have encouraged under collective bargaining. There has been opposition to the judges mentioning douceurs and so on. We are talking about pay increases.
    Mr. Roy Hughes: The hon. Gentleman has talked about the industries that we have got rid of and about progressive trade union legislation that has been enacted during the 14 years of office of this Government. Will he ponder over what we have at the end of it? First, we have at least 3 million unemployed—and that is with rigged statistics. In addition, we have a £50 billion budget deficit. Is that what he calls progress?
    Mr. Thurnham: I have not referred to any industries that we have got rid of. I can assure the hon. Gentleman that unemployment would be a great deal higher now than it is if industry were conducted as the Labour party would wish it. It is only by running our industry as competitively as we can that we can compete in world markets. Flexibility is the keynote to it. The importance of the individual must be paramount. That is built into the legislation and into this excellent Bill.
    The Labour party has a record of opposing every piece of legislation we introduce to improve industrial relations, and no doubt it will oppose this measure. I call on my hon. Friends fully to support the amendment. I am sorry that my hon. Friend the Member for Eltham is not here. I hope that he will change his mind and will support the amendment.
    Mr. Miller: The Secretary of State said that he intended to put the record straight. No one outside listening to his long diatribe would agree that the record is at all straight. The record is being established by a biased and bigoted Government who are intent on one thing. It is obvious that the Government deviously introduced the clause in order to mount a direct attack on the trade union movement.
    I have already spoken privately to the Secretary of State for being most unneighbourly. I was going to congratulate him on his elevation to his new position, but he would not give way to me during his speech, so I shall save my personal criticism of him for outside the House.
    We must ask ourselves: will the clause stand up to examination, and what exactly does it mean? My hon. Friend the Member for Bristol, East (Ms Corston) referred to the International Labour Organisation convention, which is particularly important. Several other international treaties to which we are party have been mentioned and in no case can the Government say that their argument stands up. The ILO convention makes it clear that the clause will not stand up. The precise wording of article 1 is:
    "Workers shall enjoy adequate protection against acts of anti-union discrimination in respect of their employment. Such protection shall apply more particularly in respect of acts calculated to:
    (a) Make the employment of a worker subject to the condition that he shall not join a union or shall relinquish trade union membership;
    (b) Cause the dismissal of or otherwise prejudice a worker by reason of union membership or because of participation in union activities outside working hours or, with the consent of the employer, within working hours."

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    To my mind, that article says it all. When the Minister replies, will he tell us what legal authorities the Government sought in drafting the clause? What comments were made about article 1? It is obvious that the Government cannot have taken seriously the commitments that we have entered into in convention No. 98 of the ILO.
    In the other place, Viscount Ullswater led for the Government and produced what in contradiction to his name—Ullswater is reckoned to be deep—was a shallow, disgraceful speech. That lead has been followed in this place today.
    Mr. Alex Carlile: Still waters.
    Mr. Miller: Still waters, as the hon. and learned Gentleman says.
    On several occasions, the noble Lord said that he was referring to what was best for a company. What is a company? What sort of company exists without employees? The failure to consider the interests of the company at the same time as the interests of the employees is a failing by any employer. That is exemplified in references made later, in column 24 of the Official Report of the other place of 24 May, to the way in which industrial tribunals will consider these matters. I shall deal with that in detail in a moment.
    The clause is bound to cause a great deal of confusion. Given the resources available to the Government, one must conclude that the confusing speeches by the noble Lord and the Secretary of State were deliberately so, to confuse the public about the intention of the clause.
    The hon. and learned Member for Montgomery (Mr. Carlile) referred eloquently to some of the other legal requirements that the Government appear to have carefully ignored. It is also important to consider the practical effects of the new clause for industrial tribunals. In another place, Viscount Ullswater said:
    "However, the tribunal must always have regard to the reasonableness of the action taken. If the action is 'such as no reasonable employer would take' in the circumstances, then the tribunal will still be able to decide that the action amounts to action short of dismissal in the terms of Section 146 … it will not prevent employers from making and implementing legitimate decisions about how they wish to negotiate with their employees."—[Official Report, House of Lords, 24 May 1993; Vol. 546, c. 241
    That argument is fundamentally wrong, on two counts. First, the employer is given unilateral rights under the clause to determine the content of a contract. The rights of the majority in a workplace are totally ignored should they decide that collective bargaining is the best means of negotiating. Secondly, the operation of the clause will place industrial tribunals in an impossible position. The Secretary of State has already listed the various considerations that those tribunals would have to consider. They will make their work impossible.
    The clause is another lawyers' charter. The Government should tell the House how much the clause will cost the public purse, given that it will increase the work load of the tribunal system, which is already creaking at the knees. Have they estimated the costs to employers and employees and their trade unions of fighting such cases? The clause will significantly alter the costs that were set out when the Bill was first presented to us. When the Minister of State replies, he should tell us about the likely costs.
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    The Secretary of State, in his past life, attended quite a few industrial tribunals. I wonder how recently he was engaged in such work. In our area, the north-west, the industrial tribunal system cannot cope with its current case load. It is faced with an enormous backlog; cases that I filed in my past occupation have still to be heard. That delay is due to the confusing nature of legislation.
    The hon. and learned Member for Montgomery noted that reference can be made in higher courts to what is recorded in Hansard. The new clause will pose a complicated dilemma for any court that is called upon to make head or tail of what the Government have said. On the one hand, they have said that they have no intention of creating a union-bashing charter, but on the other it is obvious from the examples cited in the other place to justify the introduction of the clause that that is the purpose behind it. The courts will have an impossible task.
    The Secretary of State sought to clarify the position, but he failed to do so. I do not wish to detain the House because I know that a number of my hon. Friends want to speak. The key to my speech is the ILO convention. It is worth repeating that it states that protection should be offered against acts designed to
    "cause the dismissal of or otherwise prejudice a worker by reason of union membership"—
    "designed to prejudice a worker". No other interpretation can be made, given that the Government justified its introduction on the ground that this will be the effect of the clause. Against that background, I urge all hon. Members to act in the interests of the rights of individuals who decide, collectively, to have their terms and conditions negotiated by a trade union. Their rights should not be prejudiced by such a shabby and disgraceful clause.
    7.15 pm
    Mr. Riddick: I had hoped to use this opportunity to welcome my right hon. Friend the Secretary of State to his new position. It gives me just as much pleasure, however, to welcome my hon. Friend the Parliamentary Under-Secretary of State to her position in the Department of Employment. I know that her style is robust. I hope that the Secretary of State will follow the robust tradition of recent Secretaries of State. I hope that he will follow in the tradition of my hon. Friend the Minister of State.
    My right hon. Friend's finest moment came during the election campaign in 1987, when he addressed the massed ranks of my constituents-to-be on a rainy day in Netherton, in the Colne valley. Six people turned up to listen to him, and, indeed, to me. For some reason, however, my right hon. Friend went away saying, "We're going to win this seat." Sure enough, we did, for the first time in 102 years. I certainly respect his political judgment.
    This has been an interesting debate. I was amused to note that the Opposition spokesman, the hon. Member for Holborn and St. Pancras (Mr. Dobson), now seems to be in favour of multinationals. I am delighted that they are now in good odour in Labour circles. There was a time when they were figures of socialist hatred, so I am pleased that the Labour party is now displaying some common sense. I noticed, however, that the hon. Gentleman did not respond to my intervention about one member, one vote —
    Mr. Boyce: On a point of order, Madam Deputy Speaker. Is the hon. Gentleman speaking to the amendment, as he should be, or replying to the debate?
    Madam Deputy Speaker: I understand him to be speaking to the amendment. I am, of course, always anxious to observe high standards, but if I were to follow the advice of the hon. Member for Rotherham (Mr. Boyce) I fear that many hon. Members would be quickly shut up.
    Mr. Riddick: I assure the hon. Gentleman that I shall speak to the amendment, but I was sorry that the hon. Member for Holborn and St. Pancras did not feel able to respond, if only briefly, to my point about one member, one vote. The reality is that the trade unions are kicking the leader of the Labour party in the teeth over this issue. It appears that he will suffer a serious reverse at the hands of the trade unions. At the end of the day, those unions are vital to the Labour party.
    The debate is another example of, when the Trades Union Congress says jump, the Labour party jumps. It is another example of the RMT, the union that sponsors the hon. Member for Holborn and St. Pancras, saying, "Yap", and the hon. Gentleman yaps.
    Mr. Miller: I was interested to hear the hon. Gentleman refer to the Trades Union Congress telling Opposition Members to jump. That would have been totally impractical, given the time scale in which the Government introduced the clause. The Opposition representatives in the other place had to think on their feet and move quickly. There was no way that consultations could have taken place with the TUC before the Opposition tabled their amendment in the other place.
    Mr. Riddick: I know that some TUC members are a bit slow, but they are not so slow as to use the days and weeks—[Interruption.]
    Madam Deputy Speaker: Order. Hon. Members must not pass between the hon. Member who is on his or her feet.
    Mr. Heald: I apologise, Madam Deputy Speaker. I thought that I had ducked, but I obviously did not.
    Mr. Riddick: I have not taken my eyes off you, Madam Deputy Speaker, and thought that I had you in view all the time. We have all heard what you have said.
    The amendment does nothing more than restate employment law as it was originally intended in the 1970s. The amendment resolves the problems created by the recent Court of Appeal judgments, and reinstates in law the status quo that has existed for about 20 years—that the law was intended to protect individual employees against specific acts of discrimination, but not to interfere with collective bargaining. That is the amendment's intention.
    Employers cannot discriminate against employees for belonging to a trade union. That right exists in addition to the fact that employers are allowed to alter the collective bargaining arrangements. Both Labour and Conservative Governments have supported the right of employers to alter their collective bargaining arrangements. Governments of both parties have recognised that employers can derecognise a trade union for negotiating purposes and introduce personal contracts—there is nothing new in that. There has been a consensus between the parties that employers should have that freedom of action.
    The hon. Member for Holborn and St. Pancras gave a catalogue of examples of individuals being forced to move
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    to personal contracts. However, companies have been able to do that for years. The amendment does not create anything new in that respect; it simply reinstates the law to the position that everyone thought prevailed before the recent court cases.
    Mr. Clapham: Does the hon. Gentleman agree that, if an employer can pay an inducement to an employee to give up his or her trade union, and so establish differentials in payments, the disadvantaged member is having action taken against him or her short of dismissal? That has created a different legal position.
    Mr. Riddick: The legislation will not create the position described by the hon. Gentleman. We are allowing employers to enter into contracts with employees, but it would be illegal for those employers to sack employees because they continued to remain in a trade union—that right still exists and is enshrined in law. The Conservative Government strengthened that right.
    I have some experience of the subject. When I worked in industry I worked for two multinational companies—first, Procter and Gamble and then Coca-Cola. They were good employers and I never felt the need to join a trade union. In both cases, I had a contract with my employer and was perfectly happy with it. I was aware that employees doing similar jobs were being paid different rates. That was for all sorts of reasons, not least because people were at different stages of their careers. I saw nothing wrong in that.
    Mr. Thurnham: My hon. Friend speaks from his experience of industry. Does he agree that, if Opposition Members had more experience of industry, they would realise the sense of what he is saying? Earlier, I spoke with experience of starting a business in engineering and having interests in the construction industry. It is obvious that, in any industry today, there must be complete freedom of individual negotiation in order to obtain the highest productivity and compete on a world basis.
    Mr. Riddick: It is regrettable that the Opposition have so little industrial experience. If my memory serves me right, the Opposition's three main economic teams—Treasury, Trade and Industry and Employment—contain practically no industrial experience. To be fair, I think that the hon. Member for Holborn and St. Pancras once worked for the Central Electricity Generating Board, but there is otherwise little experience on the Labour Benches, which I regret—[Interruption.] The hon. Member for Clydebank and Milngavie (Mr. Worthington) points to his hon. Friend the Member for Strathkelvin and Bearsden (Mr. Galbraith), who I thought had been a brain surgeon. That is an extremely useful occupation, but can hardly be classified as working in industry.
    Ms Eagle rose—
    Mr. Riddick: Perhaps the hon. Lady worked in industry, but she is not on the Front Bench.
    Ms Eagle: Does the hon. Gentleman concede that those of us who have worked in trade unions know precisely how employers are likely to behave and, in some cases, exploit their work forces? Therefore, we understand the need for good, strong and free trade unions to achieve equality and fairness in society.
    Mr. Riddick: It is regrettable that the hon. Lady should talk about companies exploiting their work forces. That is what we hear all the time from the Opposition. They seem to suggest that the majority of companies in this country are behaving in that way—they are not. Most companies in this country are good employers. The comment comes ill from a Member representing a party which has opposed every piece of employment legislation. As long as the Labour party is in the pockets of trade unions and Labour Members oppose all our trade union employment legislation, we shall not be able to take their comments seriously.
    I am not saying that people should not belong to trade unions. There are cases when it is clearly appropriate to do so—for example, when an employee has a bad employer. My wife used to work for a council, and I told her that she should be in a trade union. She was a member of, I think, the National Association of Local Government Officers. Therefore, I am not against trade unions.
    Mr. Boyce: Does not the hon. Gentleman understand that it will be the employer's right to recognise or not recognise trade unions? There is nothing in the provision to protect employees from bad employers. I cannot find such a protection within the legislation. Can the hon. Gentleman tell us where it is?
    Mr. Riddick: The hon. Member for Bristol, East (Ms. Corston) described the position at Arrowsmith in her constituency. It sounded as though it was a poor employer and was behaving badly, but what she described was not new—companies have for many years been able to sack employees who have gone on strike. There is nothing new in that. The amendment is mild in effect, and I do not believe that it will have the drastic consequences that Opposition Members are trying to suggest.
    We should consider the issues in the wider context of the massive improvements in industrial relations that have occurred during the past 14 years—[Laughter.] The hon. Member for Rotherham (Mr. Boyce) laughs, thereby showing how out of touch with reality Opposition Members are. The position in industry has been completely transformed in the past 14 or 15 years. I well remember the days in 1978–79, when the dead went unburied and strikes were the norm. As my right hon. Friend the Secretary of State said, strikes were the order of the day.
    In the year to last August, 500,000 working days were lost through stoppages. Under Labour, in one month alone 3 million days were lost. There are fewer strikes now than at any time since 1891, and that is to be applauded.
    Mr. Boyce: I thank the hon. Gentleman for allowing me to intervene for a second time. How does he reconcile his disapproval of what happened in 1979 during the so-called winter of discontent with the undying support of Lady Thatcher—whom the hon. Gentleman's lot stabbed in the back—for Solidarity in Poland?
    Madam Deputy Speaker: Order. Before the hon. Gentleman replies to that intervention, I remind the House that we are not engaged in debating the history of industrial relations or their entire scope. There is an amendment to be considered, and I suggest that hon. Members address it.
    7.30 pm
    Mr. Riddick: Thank you Madam Deputy Speaker.
    The Conservative party supports trade unions. We supported the Solidarity movement in Poland which helped to bring freedom to that country. It was a sorry commentary on the condition of trade unions in this country that we had to look to trade unions in Poland for good examples. During the hon. Gentleman's intervention, I was given some intelligence to the effect that he used to be on Sheffield city council. If ever there was a bunch of unreconstructed socialists, it must have been those councillors.
    Madam Deputy Speaker: Order. The hon. Gentleman should be addressing me, and I remind him that I must be convinced that what he says is relevant.
    Mr. Riddick: My comment was merely an aside, Madam Deputy Speaker. I did not wish to upset you in any way, and I apologise if I did.
    It is important to examine Labour's motives for opposing the amendment. The Opposition record is not good. The amendment is about the rights of individuals and the role of trade unions in society and organisations. Labour has supported strikes and the closed shop through thick and thin, and there have been recent examples of that. The hon. Member for Holborn and St. Pancras recently described the fire brigades' decision to support strike action as entirely justified. The hon. Member for Dewsbury (Mrs. Taylor) has said that she supports the teachers' case, and the hon. Member for Kingston upon Hull, East (Mr. Prescott) supported striking railwaymen. That shows where Labour's loyalties lie. We shall not take any lectures from the Opposition.
    Labour is in the pocket of the trade unions. More than half of all Labour Members are sponsored by trade unions, including all 20 members of the shadow Cabinet. Trade unions provide most of the Labour party's money.
    Madam Deputy Speaker: Order. The hon. Gentleman has not convinced me that what he is saying is relevant to the amendment.
    Mr. Riddick: My notes tell me that I was about to speak about one member, one vote, but in the light of what you have said, Madam Deputy Speaker, I had better not.
    I am delighted to support the amendment, because it protects the right of employers to change their collective bargaining arrangements. It also protects the rights of individuals to belong to trade unions and will sustain the increased flexibility in the labour market that Government reforms have brought about. Unemployment is falling at a much earlier stage in the economic cycle, and I am sure that that is due to the greater flexibility of the labour market.
    Mr. John Hutton: I intend to confine my remarks to the substance of the amendment, unlike the hon. Member for Colne Valley (Mr. Riddick).
    I have listened to most of the speeches. It could be said that the Government have at least three arguments, to use the term loosely, in support of the amendment. The first of them is that the amendment is merely declaratory and that it merely brings the law into line with the position as it is supposed to be. That argument is completely bogus. It is transparent to anyone who knows the law in this area that

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    the recent decision in the Wilson case was not unpredictable and did not change our understanding of the law.
    Where were the Government's legal advisers in 1987 when the Court of Appeal decided he case of National Coal Board v. Ridgeway? That clearly flagged the eventual decision of the Court of Appeal in the Wilson case. Where were those advisers in 1990 when the employment appeal tribunal ruled in the Armitage case? There is nothing revolutionary about the recent Court of Appeal decision in the Wilson case. The issues before the court were not substantially different from those in the Ridgeway case. Both cases involved an attempt by employers to change their collective bargaining machinery. However, the changes penalised trade union members who did not wish to support them.
    It is completely bogus for the Government to portray the amendment as simply declaratory. They might tell that to people outside, but to their Back Benchers they say, "Come along lads, this is another opportunity to put the boot in the trade unions and we expect your support in the Lobby." The Government are trying to have the best of both worlds.
    The hon. Member for Colne Valley attempted to address the idea that the amendment must be supported because it will promote flexibility in the work force. That is also completely bogus. The Opposition do not oppose flexibility. We want industrial relations law that will provide legitimate protection for the rights of individual employees whether or not they are trade union members. The hon. Member for Colne Valley did not address that. There is no reason why any work force or company cannot be flexible and also enjoy legitimate employment protection. The amendment seeks to remove that perfectly legitimate protection from many workers, irrespective of whether they are in a trade union.
    Conservative Members have not addressed the fact that the amendment legitimises and to some extent will encourage and reward the employer who tells his workers, "I have decided to change my collective bargaining machinery. You will either accept the 'benefit' or you will not receive any improvements or amendments to the terms and conditions of your employment."
    The hon. Member for Colne Valley said that he used to be employed by Pepsi-Cola.
    Mr. Riddick: Coca-Cola.
    Mr. Hutton: I have never known the difference between Pepsi-Cola and Coca-Cola. He also said that he worked for Procter and Gamble and that he decided not to join a trade union. I am willing to bet that he took the benefit of the improvement in terms and conditions that the trade unions negotiated on his behalf. How would he have felt if he had not been given the benefits that trade unions acting on his behalf had negotiated? That is the issue under debate. I am confident that the hon. Gentleman would have been horrified if he had been told by his employer, "We have negotiated improvements in terms and conditions, but, because you are not a member of the relevant trade union, you will not benefit." I shall give way to the hon. Gentleman if he wishes to respond.
    Mr. Riddick: The hon. Gentleman is Missing the point. We are not suggesting that that will happen. The hon.
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    Gentleman argues in favour of the closed shop which says that no employee should enjoy the benefits that have been negotiated with an employer unless he or she is a member of the trade union. Does the hon. Gentleman think that we should have closed shops again?
    Mr. Hutton: I gave way as a courtesy to the hon. Gentleman, but, with hindsight, I have done him no favours. The hon. Gentleman has failed to grasp the point of my argument.
    Amendment No. 8 will have precisely the effect that I have described. An employer will be able to say to particular groups of workers, "You are not part of the collective bargaining procedure that I have established; therefore, you will not enjoy any of the benefits of the resulting negotiations." If the hon. Gentleman has any doubt about that, he should read the transcripts of the Ridgeway case and the Wilson case that have recently been decided in the Appeal Court. That is precisely what happened to Mr. Wilson, and the Appeal Court said that it was unlawful.
    Have I Missed something, or are the Government trying to reverse the impact of the Wilson case? The scenario that the hon. Gentleman said was unlikely is precisely what underlines the amendments.
    The Government's third argument was that collective bargaining matters should be divorced from individual employment rights. That sounds fine, but it is false rhetoric. Whenever we talk about collective bargaining, we are inevitably talking about the individual terms on which workers are employed. That is the point and the substance of collective bargaining. When collective bargaining produces an agreement, it results in changes to the individual employment contracts of the workers concerned.
    It is bogus to say that amendment No. 8 is somehow necessary because we need to separate collective bargaining and individual employment rights. We cannot do that. Anyone who knows anything about industrial relations—and that rules out the hon. Member for Colne Valley—could not possibly make that argument.
    What can, or should, we make of amendment No. 8? It is my view and, I am sure, that of my right hon. Friends that it is a dismal amendment which will encourage discrimination and reward efforts to break up established collective bargaining procedures. Only a perverse Government pursuing an absurd vendetta against trade union members, who everywhere else in Europe are regarded as the social partners, could have possibly tabled such an amendment and come to the House and argued in its favour.
    We should remind ourselves about the claims made for the Bill when it was presented to the House for Second Reading on 17 November 1992. I quote from the speech of the then Secretary of State for Employment:
    "The Bill has two main objectives: first to strengthen and extend the rights of the individual—both individual employees and individual trade union members".
    The second objective is irrelevant to our proceedings today. The right hon. Lady continued:
    "I put it to the hon. Member for Holborn and St. Pancras what is unreasonable about allowing trade union members freedom to choose which union they join?".—[Official Report. 17 November 1992; Vol. 214, c. 168–80.]
    It is clear that the amendment underlines the Government's case on both those counts. It is not an

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    improvement in the rights of individual employees, and it clearly strikes directly at the heart of the basic principle which is the substance of our argument.
    Amendment No. 8 undermines workers' rights to join a particular union of their choice. The results of the Wilson case make it obvious that the Government intend to reverse that and take away from individual workers the right to join the union of their choice.
    It may be helpful to the House if we remind ourselves of the Tory election manifesto. I understand there is a debate in the Conservative party about what constitutes a promise. There is an election manifesto and then there is everything that Ministers say afterwards. Apparently, only the manifesto constitutes a promise.
    Let us see what the Conservative election manifesto says about this issue. It says clearly:
    "We will take measures to give individuals greater freedom in choosing a union".
    That looks lovely in principle, but amendment No. 8 runs contrary to that manifesto promise. [Interruption.] The hon. Member for Colne Valley has had his opportunity to make his argument and I am afraid that he did not make a very good fist of it. He failed to convince me and, I suspect, anyone else who had the benefit of listening to him. There is no doubt whatsoever that amendment No. 8 will strike at the heart of the freedom of individuals to choose which particular union they join.
    Mr. Riddick: How?
    Mr. Hutton: It is interesting that the hon. Gentleman says, "How?" It is clear that he has not read the Court of Appeal decision in the Wilson case. I have explained to the hon. Gentleman precisely how that will arise. Those in the Wilson case, for example, who choose not to co-operate with a changed collective bargaining procedure and decide to remain in the union of their choice do not get the benefits of any improvements in their terms and conditions of employment. If the hon. Gentleman does not understand that simple point he has problems.
    7.45 pm
    Amendment No. 8 is a partisan and puerile amendment. It will prove to be the source of injustice in the workplace which will scar our industrial relations for many years to come. The Government have said that it is a technical change, but they will let their supporters know that it is more serious.
    I believe that the amendment has been drafted by the pop-eyed fanatics with a bee in their bonnet who occasionally masquerade as Ministers in the Department of Employment. They have no sense of justice, fairness or fair play. It is a purely ideological measure which will strike directly at the conduct of good industrial relations and the individual's right to choose which union to join, which supposedly has underlined the Government's industrial relations programme for many years.
    I now return briefly to my main arguments. The amendment does not clarify the law. The law did not need clarifying as it was quite clear after the Wilson and Ridgeway cases. The amendment changes the law and will permit employers openly to discriminate against trade union members. The employer will need to show an industrial tribunal simply that there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees.
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    We also need to remind ourselves that employers are legally free to establish whatever bargaining arrangements they choose and to recognise or derecognise unions as they think fit. Why should they also have the power actively to penalise employees who want to be members of a particular trade union? That is the essence of the amendment.
    The Wilson and Ridgeway cases both involved inter-union rivalry and attempts by employers to resolve bargaining rights that resulted from that. In both cases, the Court of Appeal rightly concluded that workers were being discriminated against financially in the employers' efforts to settle the outstanding disputes about which union should be recognised. That is the point that the hon. Member for Colne Valley failed to address.
    There is quite strong evidence that the amendment does not propose to change the law relating to collective bargaining, so the freedom of an employer to change or alter his collective bargaining procedures has been left intact. Why should the employer have the additional power actively and financially to penalise employees who decide that they do not want to participate in that alteration in the collective bargaining procedure? That claim has nothing to do with flexibility; it is all about imposing a direct financial penalty on employees who fail to co-operate.
    Mr. Roy Hughes: How does my hon. Friend reconcile his point of view with the tendency today for one-union factories? If an individual is allowed to join whichever trade union he wishes, we will return to the old scenario of a multiplicity of trade unions with all the chaos that that can cause.
    Mr. Hutton: My hon. Friend has not followed the precise point I was making. It is legally the case that employees have the right under statute to join any trade union they wish. That right still exists, although a single union agreement may apply in a particular workplace. Why should individual workers be penalised financially if they choose not to be members of a particular trade union with which the employer wishes to negotiate? It is a basic right in a workplace that employees should be entitled to join whatever union they wish, and I would not want my remarks to be construed as contrary to that point.
    If there was any truth in the claim that the amendment was merely declaratory, why did not the Government act earlier? Why did not they act after the Ridgeway decision was announced in 1987, six years ago? Since then, there have been at least two occasions when the Government could have changed the law.
    The second point to which I should refer briefly concerns the. United Kingdom's international legal obligations. Some of my hon. Friends have already referred to the outstanding international law aspects of the amendment, but we need to remind ourselves that at least two international legal instruments have a bearing on our discussions today. One is article 11 of the European convention on human rights, which is a transparent declaration of rights with regard to the freedom of association which I am sure all hon. Members will support.
    Of more immediate relevance is article 1 of the International Labour Organisation convention No. 98 of 1949. It is clear from that convention that the United Kingdom Government is under a legal obligation, enforceable in international law, to respect the right of

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    freedom of association and not to take measures that could be construed as running directly counter to that international obligation.
    What is the value and benefit of an international right if, in order to exercise it, an individual employee experiences some sanction or penalty? That is not a right at all. An employee does not have a right to do something if an employer is allowed actively to penalise or impose some sanction on him.
    It is clear to me, and I suspect that it must be clear to the Government's legal advisers, that there is at least an argument that the Government have acted in a way that is inconsistent with their treaty obligation under convention No. 98. The only decent thing for the Government to do is either to acknowledge that there has been some mistake or to deratify or de-sign the United Kingdom from that International Labour Organisation convention. I bet that before too long that is precisely what the Government will do. If they do that, they will be the only Government since 1949 to deratify that convention—what an epitaph on the Government's tombstone.
    Thirdly, it is worth pointing out that the amendment is badly drafted. It simply says that there must be evidence that the employer's purpose was within paragraph (a). There is no hint in the amendment about what kind of evidence there should be, its strength or quality, or anything at all about the merits of the employer's argument. There must simply be evidence that the employer's purpose was that specified in paragraph (a).
    Conservative Members who wish to paint a rosy picture of the amendment should be clear that if an employer is presenting an argument under paragraph (a), it is only because there is also evidence that the employer is discriminating against an employee because of his or her membership of a particular union. That is the context in which any argument about the employer's purpose has to be deployed before an industrial tribunal. It has to be the case that in the absence of that argument the employer's case would fail; it would be regarded as illegal. Therefore, we must be clear that the amendment is set in the context of clear evidence of discrimination against an employee on the ground of his trade union membership.
    The House needs to look carefully at the amendment. It should he conscious of our obligations under international law and of our obligations to act fairly, with common sense and with a sense of fair play with regard to the employment rights of individual workers. If the House reaches a decision from those two perspectives, it can only reject the amendment.
    Mr. Heald: I am grateful to have the opportunity to make a short contribution. I congratulate my right hon. Friend the Secretary of State, who is absent, and my hon. Friend the Under-Secretary of State, who is present, on their recent appointments and I wish them well during the coming years.
    Mr. David Winnick,: The hon. Gentleman speaks for himself.
    Mr. Heald: I am told that I speak for myself, but I think that I speak for the Conservative party and Conservative Members in expressing those sentiments.
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    The amendment is necessary for two reasons: first, to clarify the law and, secondly, to enable employers to have bargaining arrangements with employees which suit the needs of the workplace.
    It has been said that the legal position was clear before the decisions in the Court of Appeal. Nothing could be further from the truth. I have practised in this area of the law for many years. Companies have sought advice from me on these issues. There were contentions on both sides. It is right, as was said earlier by the hon. and learned Member for Montgomery (Mr. Carlile), that somebody of the stamp of John Hendy QC is a force to be reckoned with. He had a point of view which he expressed in the Court of Appeal and he succeeded. But it is equally true that Patrick Elias QC, an eminent silk in this area, the editor of "Harvey on Industrial Relations Law", the established text, took a completely different viewpoint, argued it and lost. It is wrong to say that in those circumstances, with eminent lawyers putting forward arguable viewpoints on both sides, the law is as clear as day. That is hindsight writ large.
    Mr. John Denham: Would the hon. Gentleman therefore argue that in every case ever heard in the Court of Appeal where barristers are found to argue for both sides the law must be in doubt?
    Mr. Heald: That is not what I am saying and I think that the hon. Gentleman realises that.
    The point in this case, which I shall amplify in a moment, is that the industrial tribunal, with an experienced tribunal chairman and experienced lay members who listen to detailed argument from experienced lawyers, came to one conclusion. The matter then went to the employment appeal tribunal, which has a High Court judge who deals with such cases every day of the week, flanked by members of great eminence, including senior trade union leaders whom we all remember from years back, eminent employers and so on. They heard the arguments and decided the case in a completely different way.
    Both the industrial tribunal and the employment appeal tribunal said in this case that the decisions were difficult to make. The matter then went to the Court of Appeal which made a decision which is the current state of the law. There may be a further appeal to the other place, and who knows what the result of that would be in this case? But it is worth saying that the House has the opportunity to clarify the law tonight, and why should that not be done?
    Mr. Clapham: Does the hon. Gentleman agree that the Ridgeway v. British Coal case in 1987, when John Hendy represented the union, clarified the law and since 1987 the law has been clear? Does he further agree that that clarity was added to by the two cases that were heard in the Court of Appeal?
    Mr. Heald: If the hon. Gentleman allows me to develop my argument, I shall deal with that point.
    The point about collective agreements is that they are not legally enforceable. When in the 1970s the Government offered to make them legally enforceable the offer was flatly rejected on both sides of industry. A collective agreement which sets out a bargaining arrangement can be part of the individual's contract of employment only if it is incorporated in it, and usually it is not.

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    There has been a series of cases, of which Alexander v. STC is probably the most recent. where it was held that provisions of collective agreements that deal with bargaining machinery and such issues are not part of the individual's contract of employment. That thrust of the law has been there for 20 or 30 years. It is part of the background to what we are discussing tonight and cannot be ignored.
    It was thought of section 23 of the 1978 Act that the words
    "action … taken against him as an individual"
    meant that the action had to be concentrated on the individual's position rather than being an action that could be described as collective. It was thought that derecognising the union, taking away collective bargaining arrangements, was an action more properly directed at the union rather than the individual. Therefore, in a leading text—"Harvey on Industrial Relations Law" in fact—headed:
    "Taken against him as an individual"
    it says:
    "This requirement raises a fundamental question as to the nature of the action taken by the employer—was it collective (ie against the union itself) or individual? Action against the union that merely affects the individual as a member would not be within this section."
    Hon. Members have criticised those of us who have advised companies—and individuals, I hasten to add—on the provision over the past few years. We have been in some doubt about what the law actually is.
    The hon. Member for Barnsley, West and Penistone (Mr. Clapham) mentioned the 1987 National Coal Board case, in which the Union of Democratic Mineworkers received a higher pay award than the National Union of Mineworkers. I am not sure that NUM members received any increase in money at all, hut, if they did, it was much less than the amount received by UDM members. It was argued then that to pay a worker less because he was a member of a particular trade union was unlawful, under section 23 of the 1978 Act. Those who advanced that argument, however, did not go on to consider circumstances in which a union had been derecognised and the employer wanted to introduce individual contracts providing for such matters as profit-related pay and profit sharing.
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    It was thought at that time that if an employer was introducing a contract that was more beneficial than the existing contract in terms of pay and conditions, no one could argue that employees who did not accept that contract were being penalised under section 23. It was said by lawyers that they were simply not receiving an advantage received by others. No doubt that is a very legalistic approach. Decisions made in the Court of Appeal have taken the interpretation of the law a stage further; before April this year, no cases existed that decided these issues.
    I have mentioned the case involving the NUM and the UDM. The Armitage case—which has also been mentioned—clearly demonstrated that a union member had been punished for involving a union representative in a dispute with his employer; the references to the judgments involved are also very clear. What was not decided, however, was what happened when one group of employees received a payment and another group was not
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    given a specific punishment. The effect of those judgments has been quite different from what was expected by many in the legal profession.
    I am not saying that the Court of Appeal was wrong to make the decisions that it made in interpreting the law; any lawyer would accept that it has made its ruling. The House of Lords may decide the question on some future occasion, but why should we wait, when we have the opportunity to clarify the law and reach a conclusion tonight about its correct interpretation? It is unlikely, but perhaps the Opposition will triumph, leaving us with the judgment of the Court of Appeal and awaiting that of the House of Lords. What is more likely is that Conservative Members will back an amendment that clarifies the law, in the interests of both workers and employers.
    One of the developments that set the 1980s apart was the change in a number of aspects of the workplace—a change for the better, in my view. Suddenly, unions were prepared to reach single-union deals. I do not think that many people genuinely believe that those deals were not in the interests of the workers. Surely they were preferable to deals made by a group of unions which might not always agree among themselves, and which did not always represent the workers as effectively. I think that they were a tremendous success.
    Mr. Alan Meale: What about the closed shop?
    Mr. Heald: I will not reply to sedentary interventions.
    No one could say that workers in, for instance, the Honda factory in Swindon, where individual contracts operate, do not enjoy excellent terms and conditions.
    Mr. Etherington: Would the hon. Gentleman care to comment on the following circumstances? Individual employees have been balloted at their workplace, and have decided on a particular trade union, only to find later that their employer has imposed another union on them against their will. Is that the hon. Gentleman's understanding of democracy?
    Mr. Heald: I am grateful to the hon. Gentleman for raising the point. One of the problems in this country is the chaotic nature of the union movement. I hesitate to criticise it in the presence of so many of its members, but a large number of unions are competing with each other for membership. One of the great advantages of the single-union deal was that at least it brought some common sense into the workplace.
    Mr. Etherington rose—
    Mr. Heald: I do not accept the argument that the hon. Gentleman is probably about to advance—that giving trade unionists freedom to choose which union to join conflicts with single-union deals. The point about such deals is that it is known which union is recognised; it does the dealing, and the end result is generally in the interests of the workers.
    Mr. Etherington: How does the hon. Gentleman square his opinion with the fact that, when a single-union deal was struck in the coal industry, a Conservative Government sought to involve another union of their creation, which they sustained and nourished—the scab union that has the nerve to call itself a union, although I do not class it as one? The Government say that single-union deals must be good: that they have created

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    harmony from chaos. Yet they were responsible for effectively trying to destroy a single-union agreement in the mining industry, in much the same way as they are now destroying the industry itself.
    Mr. Heald: I could hide behind the argument that British Coal—although it has not yet been privatised—is an independent body, a corporation which makes its own decisions; but I do not think I need do that. Some Conservative Members—I am certainly one—admire the way in which UDM members stood up for common sense and decency during that long strike. I know that the hon. Gentleman will not agree, but I am glad that they were given the opportunity to play a role in the coal industry. I believe that, even now, they are presenting some of the more imaginative proposals for the industry's future—far more imaginative than those of the NUM, whose policies seem to belong to the dark ages. I do not accept that the old, NUM-style union leaders are making the most genuine, cutting-edge contributions.
    The old-fashioned, dinosaur trade union leaders often say that all the Acts passed during the 1980s should be repealed; but do Opposition Members really want to return to the days of flying pickets, secondary action and all the nonsense of the show of hands at the factory gate? We have got rid of all that, and I believe that, in general, the Labour party agrees with what we were doing two or three years ago, at any rate. It is a pity that there cannot be more consensus about where we are going.
    Companies want single-union deals and individual contracting because they want to be able to compete. They are just like you and me. It is a breath of fresh air to visit some of the modern workplaces and see what is being done there; indeed, it shows us the future. I believe that hon. Members on both sides of the House should go and look at those projects, and see the future. I believe that they should support initiatives that bring such features of British industry closer to being the norm.
    We face threats from the Pacific rim—
    Ms Eagle: We are hearing about the Pacific rim again. Does the hon. Gentleman suggest that we must compete with the lowest of the low, on what are almost slave wages, to have an industry in the future? Or does he think that we should create a floor of provision so that we can compete on quality rather than slave wages?
    Mr. Heald: I am about to visit Taiwan and Japan to see for myself. I do not claim to have personal knowledge of it. What I have read and what I have heard as a member of the Employment Select Committee from the Japanese, Taiwanese and others who have come to visit us to give evidence is that they have rising wage rates. They have high-tech industries and modern, individual contracting arrangements such as those I have described. They are leading the way to the future.
    It may be that some countries in the Pacific rim still have low wages, but not all of them have. We are competing against countries with high levels of skill and the wide range of instruments that are needed in order to be a successful modern economy. The time has come for a shake-up on the Labour Benches. The question is not whether we should have derecognition or recognition of trade unions for bargaining, but whether we recognise what the future requires so that we can move forward and
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    put Britain back to where it should be as one of the top manufacturing countries in the world. We can do that if we act together in the interests of the nation.
    Ms Eagle: Before making any comments on the amendment, I remind the House that when the Bill was in Committee I declared an interest as a member of the Confederation of Health Service Employees. I am also sponsored by that union. That does not mean any personal financial remuneration, but a small amount of money is paid to my constituency party every year. I am COHSE sponsored because I believe in principle that membership of trade unions is a good thing and that having an active trade union movement, unencumbered by vindictive laws, is a sign of freedom in a society and is something that we should all desire.
    The background to the Lords amendment is the Government's labour market policy over the past 14 years. There has been much fine and interesting shadow boxing today, mainly between lawyers, about what is at stake. What is at stake is the balance of power in industrial relations. Over the past 14 years the Government have had at their heart the desire to deregulate the labour market. They have tried to do that because it fosters exploitation, lowers wages, allows arbitrary treatment and insecurity at work and provides no knowledge of whether there will be a set contract even within a few months.
    Mr. Heald: I listened to what the hon. Lady said about the balance of power in industry. She made it sound very adversarial. Will she accept that in the best and most modern plants there is a team effort and everybody works together? They do not have a confrontational approach. Has she visited factories where that is true?
    Ms Eagle: Of course, the best industrial relations is a team effort, where it occurs. Unfortunately, the way in which the Government have changed the law, together with some of their other economic policies, has encouraged and spread bad employment practices.
    We have had six punishing and vindictive Acts of Parliament which have institutionalised discrimination against trade unions. That is unprecedented in western democracies, and it is a record of which I believe any totalitarian regime would be proud. The economic policy pursued by the Government has been so disastrous that it has led to mass unemployment on a scale not experienced since the 1930s. People who say that individual employees have a choice and can leave a job must remember how constrained that choice is when they are unlikely to obtain another job because of the bad state of the economy.
    The Government's ambition is to turn us into the sweat shop of Europe. They have made their refusal to sign the social chapter and guarantee working people decent pay and conditions into some sort of perverted virtue whereas it is a barbaric disgrace. The Government have abolished many employment protections and failed to create a framework of law which will impose responsibilities on employers to treat their work force decently. It is against that background that the amendment must be judged.
    I believe that the weakening and destruction of trade unions has been central to the Government's political aims since 1979. The Lords amendment, which is an opportunistic amendment, and was suddenly perceived as such when the Court of Appeal made its judgment and the Bill happened still to be in the Lords, is a massive

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    escalation of the assault on trade union rights. It is an assault on not only collective but individual trade union rights.
    The Government's methods and motives in this matter have been extremely cynical and beneath contempt. No other democracy would contemplate overturning a court decision so quickly, with no consultation, before the judgment was published in its written form and before all legal action in the cases concerned had been completed. We have a higher court so that it can make final judgments on such matters. The Government are so contemptuous of the rule of law and the courts that they go ahead with their ideological bigotry before the Law Lords have had a chance to sit.
    On 30 April the Court of Appeal made its judgment. On 6 May the amendment was announced in the House of Lords. It was published on 20 May—a Thursday—and on the Monday the House of Lords was asked to sit in judgment on the new clause, which had come out of the blue. After 90 minutes of debate, the clause was carried.
    8.15 pm
    The amendment is a blatant abuse of parliamentary procedures simply because, as was said earlier, the Third Reading had already taken place. Extremely unusual tactics had to be pursued in order to fit the amendment in while the Bill was in the other place. It is immoral because it gives the green light to victimisation in the workplace. It is a serious attack on the freedom of association. It is important to remember how Hannah Arendt, that great writer about totalitarianism, defined what is meant by that term. She explained that one of the conditions that needs to exist in a totalitarian regime was what she called "atomisation". That means the isolation of individuals and the derogation of collective rights. What we have here is a precise example of atomisation.
    The amendment is probably illegal. As has been mentioned, it is certainly against many of our international obligations. It is probably against article 118 of the treaty of Rome—I thought that the Government were pro-Europe. It is against the International Labour Organisation convention on freedom of association, and, as has also been pointed out, it is against the European convention on human rights. Did the Government check on any of that in their hurry to push the amendment through in the other place?
    During the debate in the other place, Earl Russell asked Viscount Ullswater whether he had taken advice on whether the amendment was contrary to European law. Viscount Ullswater said:
    "We do not believe that there is any infringement of any international obligations."
    Puzzled by that answer, Earl Russell again asked whether that opinion was based on any legal advice. Viscount Ullswater said:
    "I should have to take advice upon that."
    Clearly there was confusion.
    Mr. Michael Forsyth: I am sure that the hon. Lady would not want to misrepresent my hon. and noble Friend Viscount Ullswater. Later in the debate, in answer to a question from the noble Lord Russell, my noble Friend said:
    "the Government have not taken legal advice outside Government on the matter. However, the Government are satisfied that there is nothing in the amendment which is in
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    breach of our EC or other international obligations."— [Official Report, House of Lords, 24 May 1993; Vol. 546, c. 42–51.]
    If the hon. Lady has read the debate, I am puzzled why she is not making that position clear to the House.
    Ms Eagle: The Opposition have slightly less faith in the Government's ability to take their own legal advice and in the quality of that advice when it is taken. Doubtless the time will come when that assertion will be checked in the international courts.
    Mr. Peter Bottomley: Is that legal advice the same as that which backed up the viscount, as reported on 6 May? Viscount Ullswater said that the House of Lords should welcome the fact that
    "the Government intend to clarify an area of law which has been thrown into confusion by the Court of Appeal's decision".—[Official Report, House of Lords, 6 May 1993; Vol. 545, c. 862.]
    It seems that we have returned to the position whereby the law is what the Government want it to be after the fact rather than their saying in advance what they hope it will be and changing the law if the Court of Appeal disagrees with them.
    Ms Eagle: I thank the hon. Gentleman for his observation. The one thing that is certain is the fact that the Court of Appeal was sure about what the law should be when it made its unanimous decision on 30 April.
    In practice, the amendment will allow bribery and coercion of individuals to sign away their rights in the workplace. Its purpose is to remove the very raison d'etre of trade unions and hope that they will wither away as a result. The Court of Appeal agrees and found that the only purpose of paying non-union members a differential was to penalise people for being members of a trade union. The aim of the amendment is indirectly to abolish trade unions. I believe that that is the Government's motivation.
    What protection will there be from the abuse of employers' power and from the arbitrary imposition of different terms and conditions of work? What protection is there for the individual in the workplace if the amendment is accepted? The only thing that is worse than the amendment and the intention behind it is the Government's display of Orwellian double-speak in their cynical attempt to justify their outrageous decision to introduce amendment No. 8 in the first place.
    First, the Government denied that the amendment meant a change in the law. Indeed, the Secretary of State was at that trick again today. The Government said that the amendment is a clarification, but I believe that that notion has been comprehensively dealt with by my colleagues. Clearly, it is a serious change in the law.
    Secondly, the Government have said that a new management right is elucidated to decide exactly how management wants to negotiate with its staff. They talk a great deal about relations between employers and their staff, but the way in which they define those relations is almost like those between master and slave. The employer can do anything that he or she wants as long as it is in the workplace, and the staff have to put up with it or go. That does not lead to a good, active economic regime in a modern civilised economy.
    Mr. Michael Forsyth: The hon. Lady has been studying the record of debates in another place. Will she respond to

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    the point made by my right hon. Friend the Secretary of State about the Labour Government's position in 1975? Lord Jacques said:
    "Clause 45"—
    as it was—
    "deals with individual rights of employees, not collective bargaining issues … By giving the individual employee a right to take part in his unions' activities unimpeded, Clause 45 does not require an employer to recognise his union or treat with it in any way."—[Official Report, House of Lords, 23 September 1975; Vol. 364, c. 189.]
    The position as enunciated by the Labour Government appears to be that which the hon. Lady is attacking.
    Ms Eagle: The Minister of State must not read quotations out of context. The debate on 25 September 1975 was in answer to the Earl of Gowrie who had tabled an amendment to the effect that such protections should apply only where there was recognition of the union, which puts the entire debate in a wholly different perspective. That should be borne in mind.
    I am anxious to conclude and allow other hon. Members to speak. In Tory double-speak, denying a pay rise to a trade union member is not victimisation but allowing the employer to achieve an organisational or strategic purpose. The people of this country know precisely what is behind the Government's outrageous behaviour. Unless amendment No. 8 is thrown out and treated with the contempt it deserves, the people of Britain will realise exactly how the law is being used, and they will punish the Government for it.
    Mr. Boyce: Anybody listening to our debate would get the impression that the Tories are the workers' friends, but nothing could be further from the truth. There has been much wringing of hands today. One Conservative Member, who I understand has had to leave the Chamber to take a telephone call, said that we want more consensus politics. I wonder where he has lived for the past 14 years. Under Baroness Thatcher, consensus was a word which would not have dared utter its name in the House or elsewhere. Consensus politics went out of the window.
    We are encouraged to believe that the amendment will lead to better protection and higher wages. One Conservative Member said that it is not about lower wages but higher wages—talk about the moon being made of blue cheese. If Conservative Members were honest, they would perhaps agree with the Foreign Secretary, who said on Radio FM that Britain would have to compete with the Tamils before we succeed in the market. I have the tape of the broadcast if anybody wants to borrow it—for example, the Minister of State.
    The honest Conservative Members spoke about the least possible employee protection. If the Government were being honest, we would he discussing the abolition of trade unions because that is their final intention. Where do we go from here? One of Lady Thatcher's most praised successes was the reform of the trade unions, so why is there a need for the amendment? It is not merely to clarify the law which, in any event, is the role of the courts. We are the lawmakers and the courts interpret what we say, although perhaps not what we intended to say. The amendment is clearly a change in the law and anyone who says otherwise is not being truthful.
    I should have declared an interest at the beginning of my speech. I am proud to be a member of and sponsored
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    by the Amalgamated Engineering Union. My union was in the forefront of single union deals. I may have reservations about such deals, but they appear to be successful in many cases. What will happen if an employer can arbitrarily change the union with which he or she is negotiating without consultation? Where does that leave the employee if he decides that he wants to belong to another trade union? I could be cynical and say that I shall join the Association of First Division Civil Servants first thing tomorrow morning. I am sure that I would be welcomed within the ranks of the civil service.
    I know that other hon. Members wish to speak, so I shall conclude by returning to something I said earlier. The Bill is another step towards the derecognition and abolition of trade unions by the Government. They would admit that if they were honest. They began by banning trade unions at GCHQ. To pile agony on agony, is not it ironic that a person who injures himself and earns more than £60 a week will be refused legal aid whereas, under this legislation, anyone can challenge a trade union's decision to take industrial action or any decision that he believes will affect him personally? He has only to take the matter up with Jill Rowlands, the Commissioner for the Rights of Trade Union Members, and he will be given almost a blank cheque to pursue the union in the courts. How does that square with the democratic rights of ordinary trade unionists?
    Finally, somebody will have to tell us where the case law on equal pay for work of equal value stands now. If paying non-trade unionists more than trade unionists for the same work is not a change in law, somebody had better explain why. Somebody had better get an answer to that question quickly.
    8.30 pm
    Mrs. Alice Mahon: Whatever protests Conservative Members may make, a vital freedom is under threat from the amendment—the right freely to associate and to join in collective bargaining. The Court of Appeal was absolutely clear, and I see no confusion in its judgments. In both cases, it found that a kind of bribery was being offered, which had only one purpose—to penalise people for being members of trade unions and to deter them from remaining members. The judges spoke with great clarity when they decided that the employers' object was to reduce the power of the unions, and that such anti-union discrimination was unlawful.
    I read an article by Hugo Young of The Guardian about the court cases, in which he talked about
    "a shameful saga, showing up a politically sick society".
    I disagree with only one word of that —the word "society". I would replace it with the word "Government".
    When moving his amendment in the other place, Lord Ullswater said that the position after the judgment both of the employment appeal tribunal and of the Court of Appeal was unsatisfactory. We must ask, unsatisfactory for whom? Was it unsatisfactory for employers, who have friends in government, who want to break international law and who do not want to conform to international standards? Most of us here think that that is the truth. Of course, the amendment represents a change in the law, and it is extremely cynical to pretend otherwise. It is yet another attack on trade unions, intended to deter people from joining. The Government's objectives are clear, and they cannot hide them with all the clever "lawyerspeak"

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    that we have heard in the debate. The amendment is designed to ensure that the rights of employers to discriminate against trade unionists are solid. Everybody recognises that. The so-called dispassionate legal gobbledegook uttered by the Secretary of State does not fool anyone on the Opposition side of the House.
    I add my voice to those who have objected to the underhand way in which the amendment was sneaked into the House of Lords. It was drafted without consultation and rushed through at the last possible moment. That was a typically sneaky and cynical manoeuvre from a totally unprincipled Government.
    Trade unions are an essential part of a democracy. They are the only organisations that stand between ordinary working people and the untrammelled power of business and government. Business interests and employers have massive representation in the House and elsewhere. We all know about the secret funding by wealthy individuals and the company donations that keep the Tory party afloat and influence Tory policies. The amendment is just another example of that influence. Asil Nadir was no exception; the history of the Tory party is riddled with scandal. By contrast, trade unions are open about their support for Labour, and their members are consulted at every level.
    Over the past 14 years, there have been many pieces of legislation, every one of which has been aimed at seriously weakening trade unions and the way in which they represent working people in the workplace. The measure before us is the most pernicious of all. It is almost certainly in breach of International Labour Organisation regulations and of European legislation. No reporting and quoting Lord Ullswater will remove that fact, which will emerge again in the future.
    The Government argument that the amendment secures the right of employers to negotiate with their staff is clearly nonsense. Of course employers will flock to offer extra money to induce staff to surrender their right to union representation, because that will pay off. It will help to weaken the unions further, and once the unions are completely ineffective in bargaining, the employer will move in and pay any kind of wages and impose any kind of conditions. Inducement not to join a union will leave many employees unprotected and, of course, it will seriously weaken trade unions.
    The amendment would make it legal to victimise trade unions. It is a change in the law designed to legalise victimisation, and the Government know it. I agree with many of my hon. Friends that the next step will be to outlaw trade union membership altogether. This is a sad day for democracy, and the measure is certainly a betrayal of justice and of working people in this country.
    Mr. Gary Streeter: In view of what I have heard in the debate, I wish to make a brief contribution.
    Lords amendment No. 8 brings the law into line with what I have always assumed it to be, and I used to be a practitioner in company and in employment law. Indeed, during the 1980s I spent much time advising employers on how they could remove themselves and their employees from the shackles of old and dusty collective agreements and local house agreements, and transform the working and legal relationship into one based on individual contracts. We went about doing that in the 1980s in exactly the same way in which the amendment envisages that it
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    can be done. For all the right sound commercial reasons, the relationship between employer and employee was transformed.
    As we look round at the industrial and commercial landscape in the 1990s, we find that in many companies the reforms of the 1980s have freed up working relationships, so that rather than having to go through a trade union intermediary and negotiate on every nut and bolt, every working practice, employers and employees now talk to each other. Instead of local and national agreements, many provisions of which were not known to people locally, employers now get round the table with employees and talk about what is required in the firm. That is happening up and down the land, whether Opposition Members recognise it or not.
    Over the past 10 to 14 years, employees have benefited from better working relationships with employers than they had in days gone by. I argue strongly that what has happened as a result of Conservative trade union legislation has been to the benefit of many employees. I talk to a lot of people employed in all sorts of companies and businesses, and they appreciate having the freedom to communicate with employees and to have the kind of individual contracts of employment that can reward merit rather than rewards being locked away in collective bonuses and other agreements.
    As I said at the beginning of my speech, the amendment simply reflects the law as I have always assumed it to be. Employers have the right to sit down with employees and to change the terms and conditions of employment, without in any sense discriminating against trade union members. We must ask ourselves: does the amendment prevent anyone from joining a trade union? The answer is no, it does not. Does it deal at all with the issue of employers recognising trade unions? No. That is entirely a matter for the employer to decide in consultation with his work force.
    We are seeing on the Opposition Benches some of the ritual war dances that we have seen over the years. It saddens me enormously that lessons have not been learnt from the past 14 years. It is especially poignant that, as we debate the issue tonight, I understand that the management of Timex have now decided to close the factory because of the intransigence of trade unions in that locality.
    Mr. John McAllion: If the hon. Gentleman had any knowledge of the real situation in Dundee he would know that the factory is closing down because of the intransigence of its management, which from the very beginning has refused to negotiate. Indeed, it manoeuvred the workers outside the factory gates so that it could use Tory employment laws to sack the entire trade union work force and bring in non-union workers. But those macho tactics did not work. What we are presented with today is the sweetener approach, which it is thought will have the desired effect of doing away with trade unions and the collective rights of workers.
    Mr. Streeter: Last night, I saw trade union officials leaving a hotel in Scotland, having spoken to management. They were saying that management had said that if the dispute continued, there would be a real prospect of its having to close the factory, that there would be no alternative. The interviewer asked the trade union officials, "Does this mean that you are going to change your

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    position?" and was told, "Oh no, we will fight to the end." What a sad indictment. They have indeed fought to the end—the end of their members' jobs—and I hope that they are proud.
    Mr. Heald: Does my hon. Friend agree that the situation is governed not just by the employment laws of the 1980s? The old common law of England—
    Mr. McAllion: What about Scotland?
    Mr. Heald: The old common law of England, Wales and Scotland has always provided that if workers go on strike, the employer is entitled to dismiss them. Employers have always been able to take such action, just as workers have always been able to strike.
    Mr. Streeter: My hon. Friend makes a very valuable point. That has been the law for many generations, and it must continue to be the cornerstone of employment legislation.
    I have said all that I want to say. The amendment clarifies the law as being what it has always been intended to be. In the long term, it will benefit management and employees and will facilitate modern industrial relations.
    8.45 pm
    Mr. Denham: We have heard much about the niceties of the law and the history of the situation. I should like to put on record what happened in one of the test cases.
    The case concerning Associated British Ports in Southampton led to the judgment that resulted in this hurried amendment. It is a case that any reasonable person would describe as demonstrating unfair, unreasonable and unjust company conduct, leading to action in the Court of Appeal. The company set out to get rid of the union organisation. It offered the workers personal contracts, which required, in addition to the surrender of union recognition, the introduction of more flexible patterns of work. Three members of the union—Brian Stedman, Eddie Wyeth and Terry Palmer—said that they wanted to have continued union recognition. Those who maintained that position, following union negotiation with the company, were offered a pay increase of 8·9 per cent. Those who signed the personal contracts received an increase of 22 per cent. That is the root of this case.
    We have heard much from Conservative Members about management's need for flexibility. The personal contracts to which I have just referred included more flexible patterns of work. The three men who resisted, standing out for union recognition, said that they were absolutely committed to adoption of the same flexible working patterns as the ones included in the personal contracts. In other words, the flexibility being sought by management was on offer. The management's only reason for pursuing the case through the Court of Appeal was that it was determined to break union organisation in the port. The argument that these moves are necessary for the achievement of management flexibility are therefore refuted absolutely.
    It is a sad fact that, over the years, the port of Southampton has been a place of industrial confrontation. Unfortunately, the management there has never been able to develop the co-operative and inclusive style of management that we have heard described so glowingly by
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    Conservative Members. Within the past few months a port company—part-owned by ABP, which funds the activities of at least one hon. Member, and P and 0, which gives money to the Conservative party—sought to impose new working practices on a unionised part of the port and, at the same time, recruited a secret strike-breaking force to come in and take jobs on the outbreak of the predicted industrial action. But the industrial action did not break out, as the unions agreed to the changes in working practices for which the company had been asking. The company changed the rules again, in a further attempt to provoke industrial action and justify locking people out, as, tragically, has happened in Dundee. The truth is that management gets the type of trade unionism that it deserves. Confrontational management produces robust trade unionism, but trade unions are always blamed for the type of response.
    This country faces a clear choice about the way in which it should go in industrial relations. In Britain, there are intelligent, co-operative, far-sighted managers who recognise the importance of developing team work, of providing information to their employees, of involving people in decisions and of producing a modern and effective industrial sector. However, there is also a brutal and stupid class of management which believes in keeping the work force in the dark, in leading only from the top and in ruling by fear and insecurity. The significance of this amendment is that the Government are throwing in their lot with the latter, backward-looking, section of British industrial management. Far from promoting and backing those managers who want to work with the work force and with trade unions, to provide information, to let people in on plans and know about the difficulties and the challenges so that they may be tackled in unity, the Government have come down decisively on the side of those who say that managers should sit in their offices and send out directives and that those who do not like it can lump it.
    This amendment will not be exploited by good and far-sighted managers. They do not need it, as they do not run their organisations in such a way as to need it. The amendment will be exploited by the worst British managers for the worst reasons—the worst reasons not just for the workers, but for the country as a whole. Thus it is highly significant. It is a great shame, but not a surprise, that the Government have thrown their lot in with such people and given the wrong message to people in British industry.
    Mr. Clapham: I should like, at the outset, to declare an interest. I am a member of the National Union of Mineworkers, and I am proud to be sponsored by my union.
    Over the past 14 years the Conservative Government have put on the statute book six major pieces of legislation in this field. Each of them attacks trade union rights. The legislation has made it difficult for trade unions to operate, but it stops short of actually outlawing or penalising union membership. This amendment changes all that. If it is accepted, it will be lawful for an employer to pay a trade unionist more than another worker doing the same job in return either for relinquishing his union membership or for accepting bargaining arrangements with another trade union. That is a major change in the law, and it cannot be right.
    Clearly the amendment makes it lawful to offer a bribe. A worker is bribed for the purpose of inducing him to

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    leave the union that he chose to join. It therefore imposes action short of dismissal on those who stay with the union of their choice. It is clear that such action taken by an employer to induce workers to leave the union of their choice is intended to deter or prevent individuals from joining or remaining in the union of their choice. There is no doubt that the amendment has been introduced because of the recent Court of Appeal judgment in two cases—Associated Newspapers Limited v. Wilson and Associated British Ports and others. That judgment was not what the Government wanted. They therefore decided to change the law.
    I believe that another motive behind the amendment is to give the employer the right to choose the trade union that he considers his employees should join. That was made plain by Viscount Ullswater in the other place:
    "An employer may … wish to alter his bargaining arrangements. He may … offer incentives to encourage employees to accept a new arrangement where a certain trade union does not negotiate terms on their behalf."—[Official Report, House of Lords, 24 May 1993; Vol. 1567, c. 97.]
    The emphasis —"a certain trade union"—is important. That means that if, for example, an employer finds that his employees are in a trade union which bargains hard, or which vigorously pursues health and safety issues on the shop floor, or which robustly follows through common law damages claims, he can seek to transfer the bargaining arrangements to a union that he regards as less vigorous. Under the amendment, he could claim reasonableness in the sense that his action related to the commercial viability of his concern—that he was changing the bargaining arrangements merely to reduce his insurance premiums. The amendment thus brings about a major change in the law.
    The proposal is a shabby device to set in motion a procedure to impose the employer's will on the work force. Despite the assurances of the Secretary of State, it constitutes a change in the law, and I urge Conservative Members to consider very seriously, and to uphold, the rights of individual trade unionists by voting against it.
    Mr. Etherington: I am proud to declare my interest as a member, since 1957, of what was then the Amalgamated Engineering Union and as a member of the National Union of Mineworkers from 1963 to the present. I am sponsored by the National Union of Mineworkers. I am quite willing to let anyone know the extent of that sponsorship and I am very proud of it. There is nothing secret; everything is quite transparent.
    I was interested to note that, in seeking to justify his support for Lords amendment No. 8, the Secretary of State repeatedly referred to the need for "clarity" and "clarification". I had always understood that one sought clarity and clarification when something was opaque, not when it was transparent. If ever anything has been transparent it has been the Government's manoeuvrings in seeking to strengthen the rights and powers of employers against those whom they have the privilege to employ.
    I have never been and have never wanted to be a pedantic lawyer, although I have great respect for the legal profession and, indeed, for hon. Members with a legal background. As we talked of the various sections and subsections of legislation going back as far as 1975—and even, on one occasion, as far as 1908—it crossed my mind that it was rather unfortunate that we were spending so much time discussing the law, as this is not a legal but a
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    political matter. It is about power—and, in particular, about the creation of more power for the Government's supporters, at their request.
    It was interesting to hear the differing views that were advanced about what the relationship between employers and employees should be. I agree that, in an ideal world, it would be nice to achieve consensus. I have had the pleasure for many years of working in an industry—in fact, in more than one industry —where, for most of the time, there was consensus. I was pleased to hear the speech of the hon. Member for Eltham (Mr. Bottomley). I hope that he will not be offended if I say that much of what he said reminded me of the attitude that Lloyd George took during the Liberal Government of 1906, when he supported the rights of employees on many occasions. I say that as a compliment to the hon. Gentleman.
    I was interested, too, to hear that the hon. Member for Eltham is a member of the Institute of Personnel Management. In the rather better days before 1979, I attended a diploma course on industrial relations at Durham university at which I rubbed shoulders with personnel managers of firms with which I had nothing to do. We used to discuss something that I never hear mentioned now—pluralism. The hon. Member for Eltham understands that concept well. Pluralism is fairly simple: it means that the employer has a right to look after his interests and that those who work for him have a right to look after theirs. That is a basic human right that the Government seem to be seeking to destroy.
    That philosophy applied for many years in this country. Many Governments—even on this occasion, Conservative Governments—have introduced legislation that has improved the rights of workers in relation to their employers. I am talking not about their individual rights, but about their rights at the workplace and in relation to their employer. Conservative Governments have introduced such improvements, although one has to go back quite a number of years to find examples. In case any member of the Government should be interested in the subject, may I recommend a book called "The History of British Trade Unionism", written by Henry Pelling, from which they will learn how pluralism developed.
    Under that system, if a reasonable equation was arrived at between the rights of employers and the rights of their employees and if each was able to look after his own interests, conflicts could be resolved where they arose. We have seen that happen under various Governments—particularly in wartime, when we had compulsory arbitration and the protection of employment and so on—and it worked. For most of my teenage years and, indeed, for 20 years thereafter, I lived in a society that recognised that fact. Since 1979, however, all that has changed. I find it appalling that the Government, in the six pieces of employment legislation that they have introduced —which have been referred to extensively—have referred only to improvements in the individual rights of trade union members. "Improving that right in relation to whom?", one asks. Machinery can be set whereby anyone who has a complaint against his union and decides not to use the democratic means within that union can get redress and get legal aid. People can act against the trade union of which they are a member, but not against their employer. I defy Conservative Members to point to one piece of legislation that has been passed since they came to power that would fit those criteria. The Government have gone out of their way to look after the interests of those who

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    sponsor them, all the time trying to give the impression that they are being even-handed and looking after the rights of the individual.
    9 pm
    The Government do not seem to understand—or perhaps they understand only too well—that individual rights within a collective remain individual rights. They cannot be separated. We cannot overlook the many years in Britain which were prosperous for the country and for near-full employment. People were working full time and while there were bound to be disparities between wage rates, the vast majority of people were content in their jobs.
    The Conservatives would argue that through those years the trade unions had too much power. That is not borne out by the facts. Trade union members have rights across the spectrum of life—affecting housing, the law and so on—but, unfortunately, the least rights they have affect their very trade unionism. Their trade union rights are among the poorest in the European Community.
    We have heard much about the rights of collectives in Japan. We have been told for years how marvellous the Japanese system is. It cannot be that good, or the British Government would have given trade unionists in this country the same rights as their counterparts in Japan.
    The debate is not about the amendment but about a Government who are paranoid over the so-called power of trade unions. They are desperate to ensure that, whenever there is conflict between employer and employee, they side with the employer, regardless of the circumstances of the case. We have seen that time and again since 1979. I have yet to hear a Minister say that an employer is wrong and a trade union is right.
    Labour Members are constantly taunted about the relationship between our party and the trade union movement. I regard it as a healthy, open relationship which allows people to have their say and in which democracy prevails. Conservative Members are the last people on earth to lecture us about individual rights because they do not begin to understand what democracy means, unless and until it affects their interests and power and the way in which they manipulate that power.
    We have been told by the Conservatives for years that if employers and business can be free, the country will become prosperous. We are seeing the results of Government efforts in that respect. The manufacturing base has gone down at probably the same rate of knots as the power of trade unions has been reduced, yet the Government still do not see the link. Once the Government begin to remove people's rights and extinguish equality between employers and employees, strife is created, and that strife has a debilitating effect on the economy.
    I accept that there are good employers, but this legislation is not aimed at them. It is a panacea for bad employers and there are plenty of those. There are plenty of sweatshop employers in Britain. People are being paid £1·50 an hour for working 50 or even 60 hours a week. The Government think that there is something wrong with people asking for a 48-hour week. Supporters of the Government are earning a thousand times more than some low-paid workers and Conservative Members think that that is fair and equitable.
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    There are no market forces for trade unions because the Government have gradually been ensuring that that market is shut off and the shut-off has not been all that gradual in some cases. The Government preach free market economics, with employers being free to compete and do what they like. But people representing working folk cannot have that same freedom. They must be curtailed.
    Conservative propaganda blaming the trade unions for everything has been good over the years. They have neutered the trade unions and the country is in a bigger mess than ever. If Goebbels could return to life, he would realise what a failure he had been compared with the indoctrination that the Conservatives have undertaken. But the public are becoming wiser and trade unions are gaining in popularity. That is another reason why employers must be bolstered. I should like to develop that theme in detail, but I would anger my Whips if I continued for much longer. This will let the country as a whole see the unfairness of the Government. I hope that the hon. Member for Eltham and other hon. Members will see the sense in voting against the amendment and getting back to a decent system of industrial relations.
    Mr. Burden: When I was reading the amendment, I cast my eyes to the top of the Bill that it was supposed to be amending. The title of the Bill has always mystified me a little. The first part of it, relating to trade union reform, is confusing, because the Bill does not contain a great deal of reform. One finds a lot of red tape as far as trade unions are concerned but not a great deal in terms of reform.
    I may be a naive sort of soul but, when I see the term "employment rights", I think that the Bill should contain some rights for employees. Any extra rights that have been given to individual employees were opposed by the Government in the first place—but they were forced to accept them by Europe. In Committee and on Second and Third Reading, I heard Ministers explain and claim how the rights for employees are increasing. When they were about to abolish the wages councils, they said that it was not about cutting pay but about improving the rights of employees and employers as free agents to get together to negotiate rates for the job.
    I could not see—I have not come across it since that time—a large number of low-paid workers rushing forward to thank the Government for their extra rights. Perhaps the cat was let out of the bag by Lord Ullswater on the rights that the Government were talking about. His words in another place have been echoed in many ways by Conservative Members tonight:
    "It is, of course, the employer's right to decide exactly how he wants to negotiate with his staff. After all, no one but the employer in question can know all the relevant circumstances and can decide what is best for his business. It has always been this Government's policy to ensure that employers have the freedom to act in this way."—[Official Report. House of Lords, 24 May 1993; Vol. 546, c. 22.]
    When the Government talk about employment rights, it is rather one-sided. Employment rights exist only as far as the employer is concerned and of course it is not uniform. If an employer decides to exercise rights in a way in which the Government disapprove, the law is changed to restrict them. For example, if an employer decides, in free agreement with his or her employees, to enter into a union membership agreement, that is restricted by law. There are no rights or freedoms as far as that is concerned. If an employer decides that he or she would have an

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    agreement with trade unions for check-off, that is restricted because the Government changed the law. But if an employer's purpose is to discourage collective bargaining—if the employer wants that right—suddenly the Government are prepared to change the law.
    Within six days of a court judgment coming out which the Government found inconvenient, we had an announcement that the law would be changed. Suddenly we had a willingness to legalise bribery, cajoling and punishing people simply for saying that they want to use their trade union membership. The Government say that it is nothing to do with trade union membership—they say that they uphold the right of an individual to remain a member of a trade union—except of course in the case of GCHQ. They are happy for people to be trade union members in most situations, as long as they do not avail themselves of the benefits of membership.
    The amendment is not simply an attack on collective bargaining and collective organisation; it also jeopardises the right of employees to choose to have individual representation by a trade union. If that does not jeopardise the right of trade union membership, I sometimes wonder where the Government's logic would lead if it were applied to political parties.
    I can imagine Ministers saying, "We have changed the law for political parties. Of course, we have no objection whatever to people joining the political party of their choice." The only thing that is not allowed is for that political party to put up a candidate for election. That is the logic behind the Government's amendment.
    This is a charter to bully trade unionists and deny them bonuses. It is a charter to ensure that it is always a trade union member who ends up working the anti-social shift. It is a charter that says that a trade union member can be denied promotion. Yet the Government say that this has nothing to do with victimisation of trade union members and that it is just permitting an employer, in the words of Lord Ullswater, to
    "achieve an organisational or strategic purpose."—[Official Report, House of Lords, 24 May 1993, Vol. 546, c. 23.]
    I wonder, considering those terms, whether the noble Lord writes the scripts for "Yes Minister".
    I do not know where some Tory Members have been in recent years. Are they unaware of the fear of many employees, particularly in firms, of which I have had some experience immediately prior to privatisation, when the blue-eyed boy or blue-eyed girl syndrome is so clear? Employees fear that, if they step out of line or do something of which their employer disapproves—in some cases, that could easily be merely being a trade union member in an area of the business where the employer feels that trade union membership is inappropriate—they could be discriminated against and find their career prospects in jeopardy. If the amendment is agreed, in future their pay would also be in jeopardy.
    The amendment panders to all the worst prejudices of the Conservative party. I am pleased that some Conservative Members have principles and are prepared to accept that it is not necessarily contradictory for Conservative Members to support the right of an individual to practise trade union membership rather than just to have it, but it seems that most Tory Members will troop through the Lobby with the majority tonight.
    They will not recognise that they would improve industrial relations if they ensured that workers who have been subject to such discrimination, for example at Timex,
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    had greater rights. They would be doing something positive for the workers who have been dismissed at Burnsalls in the west midlands near my constituency. Such would be the positive signs of a Government who were interested in improving industrial relations rather than just knocking trade unions once again.
    I would applaud the introduction of a statutory right to guarantee trade union recognition if a majority of workers in a particular firm supported it. That is not the purpose of tonight's debate. At present, trade union recognition can be removed, as has been the case for a long period, purely by an employer's diktat. Tonight the Government are taking that an important stage further: they are not just giving employers the right to derecognise the collective organisation of employees, however many employees want it, but the right to jeopardise the practical realisation of trade union membership itself. That is almost certainly contrary to European law, as many of my hon. Friends have explained.
    Journalists near my constituency who work for Reed Elsevier have approached me. Why, they ask, because they happen to work in Britain, can they be pushed, cajoled and shoved to accept individual contracts with no recourse, whereas people who work for the same firm in other parts of Europe have rights?
    No Minister or Conservative Member has made any mention today of the buzz words that they use so often —"the citizens charter". I wonder why? Perhaps it is because, for the Government, when it comes to trade union membership, the rights to citizenship suddenly go out of the window. As my hon. Friends have already said, trade union members will end up with fewer rights than those enjoyed by the members of any other organisation.
    In years to come, people will study the debate and work out the Government's objectives. They will see through the statements made in another place and the protestations of Ministers and Conservative Members about their support for trade union membership. People will come to appreciate how the law was changed, and they will see that act as the latest in a long series of attacks on the rights of ordinary people to work collectively to ensure basic rights of pay, conditions of service and fair treatment. It is that principle of organisation and working together that gets right up the Government's nose. The Opposition will continue to support the principle of collective organisation, however, because it is an essential part of democracy. But it seems that democracy is something that the Government do not understand.
    9.15 pm
    Mr. Winnick: I declare my interest. Although I am not sponsored, my constituency party receives a rather modest sum from the union of which I am a member.
    As my hon. Friends have said, the Government are motivated by their attitude of sheer malice towards trade unions. They have displayed that attitude since they were elected 14 years ago. My hon. Friend the Member for Halifax (Mrs. Mahon) said that the final objective of the Government will be to abolish trade unions. Even this Government will not do that, but they will do their utmost, as they have done in the past 14 years, to undermine, weaken and erode the role of trade unions in the workplace. Even the Lords amendment, despicable though it is, should not cause any surprise to my hon. Friends.

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    If there is any question about where the Government stand on trade union rights and recognition, I refer hon. Members to an Adjournment debate on 11 March on the bitter industrial dispute at Burnsall's factory in the west midlands. That dispute continues and it should cause grave concern, because the work force have been treated with utter contempt.
    My hon. Friend the Member for Warley, East (Mr. Faulds), as the constituency Member, carried out his duties and raised the matter in the House. It is interesting to note what the then Under-Secretary of State for Employment said in that debate. Certainly the Minister of State would echo his remarks, word for word. My hon. Friend stressed that the work force had held ballots and that they had unanimously called for their trade union to be recognised. The Under-Secretary of State said of trade union recognition:
    "To argue that because there was a ballot in favour of recognition Burnsall's should agree to that can only be founded on the completely unacceptable principle that recognition arrangements can properly be decided by workers alone. That cannot be correct, as it fails to take proper account of the employers' necessary freedom to decide the terms on which they will work."—[Official Report, 11 March 1993; Vol. 220, c, 1207.]
    That attitude illustrates that no matter what ballots are held and no matter the wishes of the workers, they make no difference.
    Mr. Michael Forsyth indicated assent.
    Mr. Winnick: The Minister agrees. In his opinion and that of the Government, the management should be the deciding factor. No matter how many ballots may be held, no matter their unanimous result, the wishes of the work force are of no interest to the Government. Despite what the Government have said about balloting, the citizens charter and the rest of the cosmetic nonsense, ultimately, they believe that the management of the company should be the decisive factor and the work force should do as they are told.
    Mr. Forsyth: No doubt the hon. Gentleman will recall that, when a Labour Government introduced the measure requiring compulsory recognition of trade unions, it was later abandoned. Even the Advisory, Conciliation and Arbitration Service said that the whole thing was unworkable.
    Mr. Winnick: As the Minister knows, there is a difference between the compulsory recognition of unions and saying—which no Labour Minister would dream of saying—that it makes no difference what is done in ballots or what decisions are reached by the work force in secret ballots. "It cannot be decided by workers alone": that illustrates the background of the debate and the contemptuous attitude of the Government towards the working people of our country, particularly the millions of people who want to belong to a trade union.
    When we criticised, attacked and denounced communist and fascist dictatorships, time and again the yardstick that we used to define them was not simply the denial of the right to vote—a fundamental right—but another yardstick associated with civil liberty: the right of assembly, the right to vote secretly to elect Governments and to have a free press. It was the right to belong to a genuine union and have that union recognised at one's
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    place of employment. It is a sad commentary on today's society that so many people are penalised for belonging to a trade union.
    The Court of Appeal made the position perfectly clear. When it was deciding on the cases that form the background to the amendment, it said that the aim was to penalise people for being members of a union or to deter them from remaining members. If the amendment is passed, it will be used by countless other employers to try to bribe people to stop them belongong to a trade union —they will deny employees pay increases. Today, that is illegal. If the amendment is carried because the Government are able to organise their majority, such a practice will become legitimate.
    When my right hon. and hon. Friends say that the Government are corrupt, they are right—the Government are corrupted by power. If anyone has any illusions—none of my hon. Friends is likely to have them—they need only look on pages 1 and 3 of today's edition of The Independent to see that the Conservative party, to which Ministers belong, was willing to accept money from whatever sources, no matter how often it was told that the company making the donation was breaking the law. I am, of course, referring to Nadir. Ministers were not concerned that Mr. Nadir had not revealed the contributions in the company accounts.
    Mr. Deputy Speaker (Mr. Michael Morris): Order. The hon. Gentleman's remarks do not seem to have much to do with amendment No. 8.
    Mr. Winnick: My remarks are relevant to the fact that the Government are corrupt and determined to penalise people for belonging to a trade union. The Government are only too happy to accept money from sources which, at the time, must have seemed dubious and are now known to have been criminal. Therefore, I hope that not just one Conservative Member but a few more will have the honesty and integrity to know that what is being done today is absolutely wrong. When the Government's record is considered, the amendment will be the evidence of how corrupt and sick they have become.
    Mr. McAllion: I declare an interest as I am sponsored by the National Union of Civil and Public Servants. Probably more important is the fact that I represent constituents who have today become the latest victims of the collusion between the Government and bad employers who want to use mass unemployment to drive down the wages and conditions of workers in this country. I shall set the record straight on the relevance of the Timex dispute in Dundee to the debate.
    The Timex management and the authors of the clause share a common objective—the destruction of organised labour. The Timex management took a hard line at the start of the dispute when the issue at stake was the rotation of lay-offs because of a lack of contracts. Management was completely instransigent and refused to make any concessions to the workers, in the knowledge that that would lead to a strike. When the workers were outside the factory gates they could be sacked and Timex could seek to employ a new non-union work force whose members would accept personal contracts containing vicious cuts in wages and conditions.
    That approach did not work because of the magnificent fight by the sacked workers and the magnificent support that they received from the labour and trade union

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    movement throughout the United Kingdom. The amendment is a Government attempt at a completely different approach which will have the same effect. Instead of someone who agrees to a personal contract suffering a cut in wages, as happened at Timex, those who agree to such a contract will receive extra wages.
    That approach will completely undermine the point of belonging to a trade union. What is the point of paying trade union dues when, by way of a personal contract, one can receive higher wages than could be obtained through collective bargaining? People will be discouraged from belonging to trade unions and when membership declines and the unions disappear, the employer will have a completely free hand in personal contracts and will impose whatever cuts in wages and conditions he thinks fit.
    Perhaps some Conservative Members think that that will not happen. I was a member of the Industry-Parliament Trust with IBM which prided itself on never having trade unions because, through personal contracts, it guaranteed that none of its workers would ever face compulsory redundancy. IBM has now hit hard times and its workers know that the company is not true to its word because they are being made compulsorily redundant.
    The Government say that they are proud of their record on industrial relations. I hope that they are proud of what happened in Dundee today. The Government have advertised in German newspapers for investors to come here because of cheap labour. They should not be surprised when some of the companies that are already here take them at their word and try to impose vicious cuts in wages.
    Mr. Raymond S. Robertson rose—
    Mr. McAllion: I am not giving way, because the Front-Bench speakers are anxious to deliver the winding-up speeches. If the hon. Gentleman had any interest at all in the welfare of workers in Dundee or anywhere else in the United Kingdom, he would be on the Opposition side of the House. I shall give way briefly.
    Mr. Robertson: Will the hon. Gentleman take two minutes to explain the service that trade unions rendered in Dundee five years ago when they lost the area the massive investment of a Ford plant?
    Mr. McAllion: That is not true. The hon. Gentleman well knows that the union that he backed at that time, the Amalgamated Engineering and Electrical Union, was today the victim of the actions of multinationals.
    If the Government are at all interested in helping workers, instead of shackling the trade unions they should do something about the over-mighty power of multinationals which are running riot across the country against the interests of workers.
    Mr. Sam Galbraith: I was not in the House during the passage of most of the trade union legislation of the past decade. However, my understanding from tales of folklore is that the Government Benches were full of baying Tory Members hounding the trade unions. Now there is an interesting contrast. Numerous Conservative Members have said that this legislation is absolutely vital. We are led to believe that without it this country will never recover from the deep recession, yet the Tories are running out of speakers.
    The hon. Member for Hertfordshire, North (Mr. Heald) started to speak at 7.53 in a debate that it is agreed
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    will finish at about 10 o'clock. Embarrassed Whips were sent to the Tea Rooms and managed to drag out another Tory, the hon. Member for Plymouth, Sutton (Mr. Streeter), who delivered a perfunctory few remarks at 8.35. I hope that the Tories are embarrassed, but it is more likely that they are bored because even they are getting fed up with bashing the unions, as they have done day in and day out for the past decade.
    I was interested to hear how the new Secretary of State would tackle the amendment with which he has been landed. He comes to the Department with a reputation for decency, generosity of spirit and liberalism. [Interruption.] Those are the stories I hear in the Tea Room; I do not speak from personal experience. He did not make a good justification for that. I had the impression that he was embarrassed by what he had to say. Certainly the Minister of State will not suffer from that affliction. His only embarrassment will be that the amendment does not remove completely the right to be a member of a trade union as he would have liked.
    9.30 pm
    My understanding of the Secretary of State's analysis and the reasons behind the amendment was that they had nothing to do with collective bargaining. He tried to tease union membership and collective bargaining apart, to separate them from each other and therefore to suggest that the amendment had no effect on trade union membership. That is somewhat disingenuous. As many of my hon. Friends have said, the two issues are closely connected.
    If one is a member of a trade union but cannot exercise that right, it removes de facto the right to be a trade unionist. My hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) used as an example the credit card that cannot be used. My example is that the right to free speech is valueless if one can exercise it only in a sound-proofed room with no one else there. It was the same when the Minister tried to make that disingenuous separation between trade union membership and collective bargaining. It is not just collective bargaining that will be lost; it is the right for a trade union to represent its members with their employer on any issue other than health and safety. It effectively denudes the member of any rights whatsoever and is therefore a direct attack. So the Minister's first point was wrong.
    A further important issue is the financial inducement or bribery that is involved. The amendment legalises bribery and corruption. That should be anathema to hon. Members on both sides of the House. Even the Minister was embarrassed by that.
    The Minister, tried to justify the amendment by saying that it was just a clarification of the law. I am not a lawyer, but, by golly, we should beware anyone saying that something is just a clarification of the law. The law is a many and varied thing that works in many ways. We should beware the lawyer who is just here to be helpful and simply wants to clarify the law.
    The Government got themselves into some difficulty in justifying that. First, the Minister put forward the proposition that the law was absolutely clear cut and straightforward. If that was the case, I am not sure why it needed clarifying, but it was clarified.
    Another argument put forward by the hon. Member for Hertfordshire, North was that the law was not clear at all;

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    in fact, it was a shambles and everyone had different interpretations of it. They could at least have come up with the same excuses and briefed one another better.
    The reason behind the confusion is that that argument is wrong. I agree with the Minister that the law was clear. The Court of Appeal has made it clear. If it was not clear, the court has clarified it. Everyone agrees about that. There was no stream of cases against employers trying to remove the rights of trade union members because employers knew that they would be in breach of section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992. The Minister proposed not clarification, but simply changing the law once again to the benefit of the employers. Once again, it was an attack on the trade unions.
    The Minister's third point was that somehow or other the amendment is not an attack on the trade unions. I would believe that a bit more if an amendment put forward in the other place had been accepted. Baroness Turner of Camden moved an amendment to insert, among other things,
    "not to discriminate against employees who were members of an independent trade union".
    That would have made it clear that, however the law was changed, it would not discriminate against trade unionists.
    Viscount Ullswater indulged in some wonderful double-speak when he said:
    "It would provide that in a situation where a tribunal has evidence of two purposes for an employer's action and where the clause provides that it shall therefore consider the negotiating purpose to be the relevant purpose, it will only do so if there is not additional evidence of a principal purpose to discriminate against employees who are trade union members."—[Official Report, House of Lords, 24 May 1993; Vol. 546, c. 88–89.]
    That is just a start. He says that again, two or three paragraphs later, in many more words. In other words, the purpose was clearly to discriminate against trade unions. The law was clear. The Government have confused it. We shall be back in the law courts again seeking further clarification of the procedure.
    The amendment was slipped in at the last minute in an underhand, sneaky, sleekit way without the opportunity for due consideration. It is a mark of the Government's weakness. Here they are, unable to accept the Court of Appeal's ruling. They pretend that they are a macho Government, show their weakness and immediately change the law. They do not even wait for the matter to go to appeal in the other place. They do not consult anyone else. They simply get in there while they can and change the law in order to establish that, with all their powers, they can do what they like. That is not a sign of strength; it is a sign of weakness, ably reflected by the Government.
    The amendment also shows how the Government are in thrall to management. No matter what the Court of Appeal says, no matter what their international obligations, no matter what common justice dictates, no matter what decency suggests, everything in industrial law has to be for the benefit of management and employers: they are the only ones who have rights.
    Whenever there was a conflict in Committee between employee and employer and management, the Government always came down on the side of the employer, as if they had some inalienable right, as if there were some inherent law, such as the law of gravity or Newton's third law of motion, be it ethical or physical, which I never got to the bottom of, a right not given to
    824
    employees but always given to employers. The Government are in the thrall of management. When management and employers say jump, the Government jump on their behalf.
    Not only was the amendment introduced in a sneaky, sleekit way at the last minute, without consultation, not quite at the dead of night, but certainly as the night was drawing in, but the Government indulge in double-speak. The Conservative research department brief on employ-ment and training, a laughable document which is a good read for anyone who has not read the Dandy or the Beano for a while, says:
    "Conservative Governments have transformed Britain's poor industrial relations record and have created"—
    this is the Government's aim—
    "a fairer balance between employers and trade unions."
    The brief goes on to say that the Government's aims are
    "to defend individual liberty"—
    tell that to people—
    "… and to restore a fairer balance between employers and trade unions; and to make remedies available".
    The Government's idea of a fairer balance is simply once again to remove the rights of employees and hand all powers and rights to the all-powerful employers.
    It is a pity that the clause has not been given due consideration. It is probably technically flawed; certainly it would benefit from further debate. I have already dealt with the argument that it is not about bashing the trade unions. An amendment tabled in another place, which was turned down by the Government, would have clarified the matter.
    I believe that the hon. and learned Member for Montgomery (Mr. Carlile) referred to the words
    "the tribunal shall regard the purpose mentioned in paragraph (a) … as the purpose for which the employer took the action, unless it considers that the action was such as no reasonable employer would take".
    I am familiar and quite happy with the phrase
    "such as no reasonable employer would take";
    similar phrases are used in medical evidence. References are made to reasonable doctors with equal standards behaving in a reasonable manner in, for instance, cases involving negligence.
    As the hon. and learned Member for Montgomery pointed out, that is not the crux of the amendment, although it will certainly give employers a field day. The crux is in the words that follow:
    "having regard to the purpose mentioned in paragraph (a)."
    Perhaps the Minister will clarify that. Does it mean that paragraph (a) must be judged reasonable or otherwise—which would be the decent thing—or does it merely mean that the action taken must be reasonable in order to achieve the purpose in paragraph (a)? That purpose could be entirely unreasonable, but perhap that will not be considered, provided that the steps taken are themselves reasonable. In such circumstances, the test of reasonableness will relate not to the action taken by the employer against his employee, but to the steps that he takes to achieve his aim. [Interruption.] My manager is giving me a tick-tack message. As I am generally well behaved and an extremely reasonable chap in both action and demeanour, I shall conclude my speech.
    Tonight, we are preparing to introduce yet another piece of trade union legislation. All the trade union legislation that has been introduced in the past decade has been predicated on the premise that Britain's industrial decline can be set at the unions' door: it has all been caused by trade union militancy. If only legislation could be

    825
    passed to neuter the unions, unemployment would suddenly cease to exist; there would be no balance of payments deficit and no public sector borrowing requirement; and manufacturing investment would go up and up. What do we have today? We have a rip-roaring balance of payments deficit; public sector borrowing is over the top; 4 million people are unemployed; and the economy is in disarray.
    The Government's legislation was based on a false premise. It has not worked, and it never will; nor 'will the amendment.
    Mr. Michael Forsyth: The hon. Member for Strathkelvin and Bearsden (Mr. Galbraith) accused Conservative Members of having run out of speakers at 7.53 pm. Opposition Members ran out of argument at about 4.38 pm. two minutes after the hon. Member for Holborn and St. Pancras (Mr. Dobson) stood up.
    I do not think anyone could deny that we have examined the amendment in a thorough and detailed manner. We have heard conflicting views about its meaning. The Opposition have exaggerated and misrepresented its effects in an attempt to portray it as an attack on the rights of trade unionism; the hon. Member for Wallasey (Ms Eagle) even told us how to spot the seeds of totalitarianism. Let me tell her that totalitarianism begins with socialism, not with a belief in free enterprise or the market forces so hated by the hon. Member for Sunderland, North (Mr. Etherington).
    My hon. Friends the Members for Plymouth, Sutton (Mr. Streeter). for Hertfordshire, North (Mr. Heald) and for Teignbridge (Mr. Nicholls) brought some common sense to our proceedings, giving us the benefit of their legal and professional training and expertise.
    It should be absolutely clear that the Government value highly the protection that section 146 has offered, and will continue to offer, individual employees. It has an important role to play in ensuring that employers do not victimise individual employees to persuade them to become, or to cease to be, trade union members. It has no part to play in collective and strategic issues such as an employer's decision to introduce personal contracts for his work force.
    We have had claims about the effects of the new clause from Opposition Members which, even by the high standards of the hon. Member for Holborn and St. Pancras, have set new records. His claims about bribes to leave unions and penalties for remaining in unions are unfounded, exaggerated and nonsensical. He was at it again yesterday. He told the BBC's one o'clock news that:
    "The amendment will make it lawful for an employer to bribe or punish an employee if they are a member."
    He told Channel 4 news yesterday:
    "The Government is proposing to change the law to encourage employers to deter people from being in unions or to penalise them for doing so."
    I must tell my hon. Friend the Member for Eltharn (Mr. Bottomley) that it was not the Court of Appeal whom I accused of talking poppycock, but the hon. Member for Holborn and St. Pancras and the others who joined him in misrepresenting the position.
    The amendment is not about trade union membership. It is about an employer's right to organise his business as he sees fit, and an employee's right to accept arrangements that can improve his or her terms and conditions.
    My hon. Friend the Member for Eltham also suggested that we might idemnify the loser for costs if either of the
    826
    two Court of Appeal cases goes to the House of Lords. Any appeal would be on the basis of the law as it currently exists. The new clause will not apply retrospectively and I do not, therefore, believe that we would be justified in acceding to that request.
    Mr. Peter Bottomley: My hon. Friend's crucial point is fair. Section 146 still exists and will continue to exist even if the amendment is written into the law. My hon. Friend will agree that the industrial tribunal found, as a matter of fact, that the actions of the employers in each case wholly negated union membership. Can he tell the House whether, in his view—it will be decided by the courts in the end—Mr. Palmer and Mr. Wilson would have been unsuccessful if this amendment had been written into law when their cases were heard by the industrial tribunal?
    Mr. Forsyth: I should not be drawn on that matter. The amendment is clear and it is for the courts to determine, on the basis of the facts, what will apply. The employment appeal tribunal highlighted a lack of clarity in the law and that is why the amendment is required.
    The hon. and learned Member for Montgomery (Mr. Carlile) and the hon. Member for Strathkelvin and Bearsden asked me to put on record the meaning of the words which include a test of reasonableness. The wording is included in the clause to provide a further test of the employer's action. If the tribunal is satisfied that there is evidence that the employer has a purpose.
    "to further a change in his relationship with all or any … of his employees",
    it must also be satisfied that the action was not
    "such as no reasonable employer would take"
    to further that purpose. Otherwise, the action could still be found to have been taken for a purpose within section 146, and therefore to have been unlawful. I hope that that helps hon. Members. It should help my hon. Friend the Member for Eltham with the substance of his question, if not the case that he put to me.
    The hon. and learned Member for Montgomery also asked why we had not waited for the outcome of any eventual House of Lords hearing. My hon. Friend the Member for Teignbridge made the key point that even if an appeal were to be heard and whether or not the Court of Appeal judgments were reversed, the difficulties would not necessarily be resolved.
    The purpose of the courts is to interpret the law as it is enacted by Parliament. It has become clear that this section of the law as presently drafted has caused, and is continuing to cause, difficulties for the tribunals and the courts and it is right that we should take steps to clarify it.
    As my hon. Friend the Member for Cambridgeshire, South-East (Mr. Paice) said in an excellent speech, the Government have made clear their aim to create a climate in which individual effort and performance can be rewarded. In our White Paper, "People, Jobs and Opportunity" which was published before the general election—we fought and won a general election on its basis —paragraph 4.7 says:
    "The Government … will continue to encourage employers to move away from traditional, centralised collective bargaining towards methods of pay determination which reward individual skills and performance; respond to the wish of individual employees to negotiate their own terms and conditions of employment; and to take full account of business circumstances".
    Who could argue with that?

    827
    The amendment is entirely consistent with that policy. It will remove an artificial and unintended obstacle to employers who wish to differentiate within their pay structures as they move in that direction.
    In response to those such as the hon. Member for Southampton, Itchen (Mr. Denham) who have questioned employers' motives in offering incentives to employees who agree to accept personal contracts, let me say that there are perfectly legitimate business reasons for doing so. In a letter to my Department on 24 May—after we had tabled the amendment—the chairman of Associated British Ports explained his company's position as follows:
    "Generally, we believe that personal contracts give companies and their customers substantial advantages. We think it is only right, therefore, that those who accept personal contracts receive benefits greater than those who remain within a negotiated employment structure.
    The company pays more to an employee who undertakes to work with complete flexibility, and the employment contract permits the company to base remuneration on merit and to withhold an annual pay increase if the company should run into financial difficulties. Basically, an employee who accepts a personal contract is selling a higher value product in the employment market, and should be rewarded accordingly".
    I agree with him.
    Many employers would echo those sentiments, as would the many thousands of employees who have benefited financially and in terms of personal motivation from the opportunity to be rewarded on the basis of their own commitment and performance. I agree with my hon. Friend the Member for Hertfordshire, North. Only the neanderthals in the Opposition and their trade union mentors still adhere to the fallacy that rigid pay structures and equal pay rates for everyone doing the same work are the best way of improving productivity in a modern economy.
    Mr. Dobson: If individual contracts are so attractive, why do employers have to offer financial incentives to get people to accept them?
    Mr. Forsyth: If the hon. Gentleman is so wedded to the concept of collective bargaining, why are he and his colleagues so worried that people will get more money because they are abandoning collective bargaining? I thought that the Opposition's argument to justify collective bargaining was that it gained a better deal for employees. We have now heard from the Opposition that that is no longer the case.
    What sticks in the gullet of members of the Opposition is that improvements in pay and conditions can be achieved by individuals acting on their own initiative, without the precious protection of trade unions and the apparatus of collective bargaining. The Opposition have always been keen to show examples where a trade union can negotiate a better deal for its members, but they cannot bear the thought that people might be able to negotiate a better deal for themselves as individuals.
    In attempting to discredit the amendment, the Opposition have succeeded in tying themselves in knots. In attacking the amendment, they have sought to portray it as a new weapon in the hands of employers who want to derecognise trade unions. Perhaps they even believe that it can operate only in that one-sided way.
    We certainly do not want to prevent employers from derecognising trade unions, which has been the
    828
    Government's position since we abolished the previous Labour Government's wholly unworkable statutory recognition legislation in 1980. Even the Advisory, Conciliation and Arbitration Service recognised that this legislation could not be made to work and told the Government so. Nor would we want to prevent an employer from recognising one or more trade unions for collective bargaining if it suits his business purposes. The important point is that employers should be free to decide what bargaining arrangements best suit their circumstances at a particular time. That is precisely what the amendment will achieve.
    The Opposition ignore entirely the fact that the amendment is even-handed. In the two cases before the Court of Appeal, the employers offered a financial incentive to those who agreed to personal contracts, but the amendment would cover the actions of employers just as much if they decided, for example, to introduce a single union agreement and to offer an incentive to those who agreed to have their pay negotiated under that arrangement. Of course the employer would still be at risk of acting unlawfully if he sought to compel people to join the particular union concerned, just as he would be at risk if he sought to prevent people from being members of any trade union when they agreed to sign personal contracts.
    I should have expected the Opposition to welcome an amendment that enabled employers to offer incentives to encourage people to agree to have their pay settled through a single union agreement. After all, the Labour party, despite its much-trumpeted conversion to espousing the rights of the individual, voted against clause 13, which gives individuals greater freedom to join the union of their own choice. Why did they vote against it? They argued that it posed a threat to single-union deals. Never mind that the argument was based on an entirely false premise. Never mind the fact that the unions and the Labour party can at best be described as latter-day converts to the merits of the single union deal. Never mind that Labour's real reason for voting against the clause was to try to protect the power of the trade union bosses and to prop up the creaking edifice of the TUC's so-called Bridlington principles.
    Where is the consistency in claiming to uphold the rights of individuals, yet seeking to deny them the right to join the union of their choice? Where is the consistency in upholding the merits of single-union agreements and then arguing against an amendment that would allow employers to offer incentives to promote acceptance of such an arrangement? The only consistency in those arguments—a consistency that runs right through the industrial relations policy of the Labour party—is that, as my hon. Friend the Member for Colne Valley (Mr. Riddick) said, Labour is once again obeying the orders of the TUC and the trade union bosses who still dictate its policies on such matters. Those people are at this very moment fighting a rearguard action to ensure that they can continue to dictate Labour party policies in the future. No one is fooled by the Opposition's claims to represent the interests of the individual. How could they be when the Labour party is so much in thrall to the collectivist ideals of trade unionism and traditional collective bargaining?
    I wonder why have we spent whole day in the House debating the amendment. Could it be anything to do with the criticisms of Mr. John Edmonds that the Labour party was not doing enough to fight the cause of the trade union movement? Is that why there has been such an impressive

    829
    display of jousting for the trade union barons? Union membership does not carry any automatic right to trade union recognition, or to have pay determined by collective bargaining. Indeed, there have always been many thousands of people who want to belong to trade unions even though their employers do not engage in collective bargaining. There are about 1 million trade unionists who are not covered by collective bargaining. That is one in 10 of all trade union members in Britain. What is the message from the hon. Members for Holborn and St. Pancras and for Bolsover (Mr. Skinner) to those people? Presumably it is that their membership cards are worthless, and that they should tear them up and leave the union. The Labour message throughout the debate has been that without collective bargaining there is no proper trade union membership. I hope that that message was heard and received.
    This evening, we have seen once again the shallowness of the Opposition's commitment to the individual and the depth of their loyalty to the collectivism of the past. They have not changed their spots. As my hon. Friend the Member for Teignbridge pointed out, they have consistently opposed our policies to give new rights and protections to trade union members. They have opposed the new right in the Bill for individuals to belong to a union of their choice. They have opposed the new protections for union members who pay their subscriptions by check-off. In the past, they opposed our reforms to outlaw the iniquities of the closed shop, even though that meant denying a job to thousands of individuals. They even opposed our reforms that gave individual trade union members the right to a secret ballot before their union could call on them to go on strike.
    The Opposition are driven by the bosses of the trade unions, and it is the Government who have restored individual rights to trade union members. The amendment would allow individual trade union members to exercise choice over the appropriate form for their bargaining arrangements. Many trade union members have already chosen to do so, and many more will do so, no doubt welcoming the freedom given to them by a Conservative Government.
    The truth is that Opposition Members will never be free to do what is right for trade union members until they are freed from having to look over their shoulders at the wishes of union leaders, on whom their power depends. That is why the Opposition would deny employers and individuals the flexibility to agree bargaining arrangements that would best reflect performance and reward individual effort. They would reinforce the rigidity of collective bargaining, where the interests of the individual are subordinated to the lowest common denominator.
    This amendment will help to create and support flexibility—something to which the Government are firmly committed in the interests of competitiveness, individual motivation and the creation of sustainable jobs. I commend it to the House.
    Question put, That this House doth agree with the Lords in the said amendment:—
    The House divided:Ayes 297, Noes 275.

    Division No. 297]

    [10.00 pm

    AYES

    Ainsworth, Peter (East Surrey)

    Alison, Rt Hon Michael (Selby)

    Aitken, Jonathan

    Allason, Rupert (Torbay)

    Alexander, Richard

    Amess, David

    830

    Arbuthnot, James

    Evennett, David

    Arnold, Jacques (Gravesham)

    Faber, David

    Arnold, Sir Thomas (Hazel Grv)

    Fabricant, Michael

    Ashby, David

    Field, Barry (Isle of Wight)

    Aspinwall, Jack

    Fishburn, Dudley

    Atkinson, Peter (Hexham)

    Forman, Nigel

    Baker, Rt Hon K. (Mole Valley)

    Forsyth, Michael (Stirling)

    Baker, Nicholas (Dorset North)

    Forth, Eric

    Baldry, Tony

    Fowler, Rt Hon Sir Norman

    Banks, Matthew (Southport)

    Fox, Dr Liam (Woodspring)

    Banks, Robert (Harrogate)

    Fox, Sir Marcus (Shipley)

    Bates, Michael

    Freeman, Rt Hon Roger

    Batiste, Spencer

    French, Douglas

    Bellingham, Henry

    Gale, Roger

    Bendall, Vivian

    Gallie, Phil

    Beresford, Sir Paul

    Gardiner, Sir George

    Blackburn, Dr John G.

    Garel-Jones, Rt Hon Tristan

    Body, Sir Richard

    Garnier, Edward

    Bonsor, Sir Nicholas

    Gill, Christopher

    Booth, Hartley

    Gillan, Cheryl

    Boswell, Tim

    Goodlad, Rt Hon Alastair

    Bottomley, Rt Hon Virginia

    Goodson-Wickes, Dr Charles

    Bowis, John

    Gorman, Mrs Teresa

    Boyson, Rt Hon Sir Rhodes

    Gorst, John

    Brandreth, Gyles

    Grant, Sir Anthony (Cambs SW)

    Brazier, Julian

    Greenway, Harry (Ealing N)

    Bright, Graham

    Greenway, John (Ryedale)

    Brooke, Rt Hon Peter

    Griffiths, Peter (Portsmouth, N)

    Brown, M. (Brigg & Cl'thorpes)

    Grylls, Sir Michael

    Browning, Mrs. Angela

    Hamilton, Rt Hon Archie (Epsom)

    Bruce, Ian (S Dorset)

    Hamilton, Neil (Tatton)

    Budgen, Nicholas

    Hampson, Dr Keith

    Burns, Simon

    Hanley, Jeremy

    Burt, Alistair

    Hannam, Sir John

    Butcher, John

    Hargreaves, Andrew

    Butler, Peter

    Harris, David

    Butterfill, John

    Haselhurst, Alan

    Carlisle, John (Luton North)

    Hawkins, Nick

    Carlisle, Kenneth (Lincoln)

    Hawksley, Warren

    Carrington, Matthew

    Hayes, Jerry

    Carttiss, Michael

    Heald, Oliver

    Cash, William

    Heathcoat-Amory, David

    Channon, Rt Hon Paul

    Hendry, Charles

    Churchill, Mr

    Heseltine, Rt Hon Michael

    Clappison, James

    Hicks, Robert

    Clark, Dr Michael (Rochford)

    Higgins, Rt Hon Sir Terence L.

    Clifton-Brown, Geoffrey

    Hill, James (Southampton Test)

    Coe, Sebastian

    Horam, John

    Colvin, Michael

    Hordern, Rt Hon Sir Peter

    Congdon, David

    Howard, Rt Hon Michael

    Conway, Derek

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

    Coombs, Anthony (Wyre For'st)

    Howell, Rt Hon David (G'dford)

    Coombs, Simon (Swindon)

    Howell, Sir Ralph (North

    Cope, Rt Hon Sir John

    Norfolk)

    Cormack, Patrick

    Hughes Robert G. (Harrow W)

    Couchman, James

    Hunt, Rt Hon David (Wirral W)

    Cran, James

    Hunter, Andrew

    Currie, Mrs Edwina (S D'by'ire)

    Hurd, Rt Hon Douglas

    Curry, David (Skipton & Ripon)

    Jack, Michael

    Davies, Quentin (Stamford)

    Jackson, Robert (Wantage)

    Davis, David (Boothferry)

    Jenkin, Bernard

    Day, Stephen

    Jessel, Toby

    Deva, Nirj Joseph

    Johnson Smith, Sir Geoffrey

    Devlin, Tim

    Jones, Gwilym (Cardiff N)

    Dickens, Geoffrey

    Jones, Robert B. (W Hertfdshr)

    Dicks, Terry

    Jopling, Rt Hon Michael

    Dorrell, Stephen

    Key, Robert

    Douglas-Hamilton, Lord James

    Kilfedder, Sir James

    Dover, Den

    King, Rt Hon Tom

    Duncan, Alan

    Kirkhope, Timothy

    Duncan-Smith, Iain

    Knapman, Roger

    Dunn, Bob

    Knight, Mrs Angela (Erewash)

    Durant, Sir Anthony

    Knight, Greg (Derby N)

    Dykes, Hugh

    Knight, Dame Jill (Bir'm E'st'n)

    Eggar, Tim

    Kynoch, George (Kincardine)

    Elletson, Harold

    Lait, Mrs Jacqui

    Evans, David (Welwyn Hatfield)

    Lang, Rt Hon Ian

    Evans, Jonathan (Brecon)

    Lawrence, Sir Ivan

    Evans, Nigel (Ribble Valley)

    Legg, Barry

    Evans, Roger (Monmouth)

    Leigh, Edward

    831

    Lennox-Boyd, Mark

    Shaw, David (Dover)

    Lester, Jim (Broxtowe)

    Shaw, Sir Giles (Pudsey)

    Lidington, David

    Shephard, Rt Hon Gillian

    Lilley, Rt Hon Peter

    Shepherd, Colin (Hereford)

    Lloyd, Peter (Fareham)

    Shepherd, Richard (Aldridge)

    Lord, Michael

    Shersby, Michael

    Luff, Peter

    Sims, Roger

    Lyell, Rt Hon Sir Nicholas

    Skeet, Sir Trevor

    MacGregor, Rt Hon John

    Smith, Tim (Beaconsfield)

    MacKay, Andrew

    Soames, Nicholas

    Maclean, David

    Spencer, Sir Derek

    McNair-Wilson, Sir Patrick

    Spicer, Sir James (W Dorset)

    Madel, David

    Spicer, Michael (S Worcs)

    Maitland, Lady Olga

    Spink, Dr Robert

    Malone, Gerald

    Spring, Richard

    Mans, Keith

    Sproat, Iain

    Marland, Paul

    Squire, Robin (Hornchurch)

    Marlow, Tony

    Stanley, Rt Hon Sir John

    Marshall, John (Hendon S)

    Steen, Anthony

    Marshall, Sir Michael (Arundel)

    Stephen, Michael

    Martin, David (Portsmouth S)

    Stern, Michael

    Mawhinney, Dr Brian

    Stewart, Allan

    Mellor, Rt Hon David

    Streeter, Gary

    Merchant, Piers

    Sumberg, David

    Milligan, Stephen

    Sweeney, Walter

    Mills, Iain

    Sykes, John

    Mitchell, Andrew (Gedling)

    Tapsell, Sir Peter

    Mitchell, Sir David (Hants NW)

    Taylor, Ian (Esher)

    Moate, Sir Roger

    Taylor, John M. (Solihull)

    Montgomery, Sir Fergus

    Taylor, Sir Teddy (Southend, E)

    Moss, Malcolm

    Temple-Morris, Peter

    Needham, Richard

    Thomason, Roy

    Neubert, Sir Michael

    Thompson, Patrick (Norwich N)

    Newton, Rt Hon Tony

    Thornton, Sir Malcolm

    Nicholls, Patrick

    Thurnham, Peter

    Nicholson, David (Taunton)

    Townend, John (Bridlington)

    Nicholson, Emma (Devon West)

    Townsend, Cyril D. (Bexl'yh'th)

    Norris, Steve

    Tracey, Richard

    Onslow, Rt Hon Sir Cranley

    Tredinnick, David

    Oppenheim, Phillip

    Trend, Michael

    Ottaway, Richard

    Twinn, Dr Ian

    Page, Richard

    Vaughan, Sir Gerard

    Paice, James

    Viggers, Peter

    Patnick, Irvine

    Waldegrave, Rt Hon William

    Patten, Rt Hon John

    Walden, George

    Pattie, Rt Hon Sir Geoffrey

    Waller, Gary

    Pawsey, James

    Wardle, Charles (Bexhill)

    Peacock, Mrs Elizabeth

    Waterson, Nigel

    Pickles, Eric

    Watts, John

    Porter, Barry (Wirral S)

    Wells, Bowen

    Porter, David (Waveney)

    Wheeler, Rt Hon Sir John

    Portillo, Rt Hon Michael

    Whitney, Ray

    Powell, William (Corby)

    Whittingdale, John

    Redwood, John

    Widdecombe, Ann

    Renton, Rt Hon Tim

    Wiggin, Sir Jerry

    Richards, Rod

    Wilkinson, John

    Riddick, Graham

    Willetts, David

    Rifkind, Rt Hon. Malcolm

    Wilshire, David

    Robathan, Andrew

    Winterton, Mrs Ann (Congleton)

    Roberts, Rt Hon Sir Wyn

    Winterton, Nicholas (Macc'f'ld)

    Robertson, Raymond (Ab'd'n S)

    Wolfson, Mark

    Robinson, Mark (Somerton)

    Wood, Timothy

    Roe, Mrs Marion (Broxbourne)

    Yeo, Tim

    Rowe, Andrew (Mid Kent)

    Young, Rt Hon Sir George

    Rumbold, Rt Hon Dame Angela

    Ryder, Rt Hon Richard

    Tellers for the Ayes:

    Sackville, Tom

    Mr. David Lightbown and

    Scott, Rt Hon Nicholas

    Mr. Sydney Chapman.

    NOES

    Abbott, Ms Diane

    Banks, Tony (Newham NW)

    Adams, Mrs Irene

    Barnes, Harry

    Ainger, Nick

    Barron, Kevin

    Ainsworth, Robert (Cov'try NE)

    Battle, John

    Allen, Graham

    Bayley, Hugh

    Anderson, Donald (Swansea E)

    Beckett, Rt Hon Margaret

    Anderson, Ms Janet (Ros'dale)

    Beggs, Roy

    Armstrong, Hilary

    Bell, Stuart

    Ashton, Joe

    Benn, Rt Hon Tony

    Austin-Walker, John

    Bennett, Andrew F.

    832

    Benton, Joe

    Gilbert, Rt Hon Dr John

    Bermingham, Gerald

    Godsiff, Roger

    Berry, Dr. Roger

    Golding, Mrs Llin

    Betts, Clive

    Gordon, Mildred

    Blair, Tony

    Gould, Bryan

    Blunkett, David

    Graham, Thomas

    Boateng, Paul

    Grant, Bernie (Tottenham)

    Bottomley, Peter (Eltham)

    Griffiths, Nigel (Edinburgh S)

    Boyce, Jimmy

    Griffiths, Win (Bridgend)

    Boyes, Roland

    Grocott, Bruce

    Bradley, Keith

    Gunnell, John

    Bray, Dr Jeremy

    Hain, Peter

    Brown, Gordon (Dunfermline E)

    Hall, Mike

    Brown, N. (N'c'tle upon Tyne E)

    Hanson, David

    Bruce, Malcolm (Gordon)

    Harman, Ms Harriet

    Burden, Richard

    Harvey, Nick

    Byers, Stephen

    Hattersley, Rt Hon Roy

    Caborn, Richard

    Henderson, Doug

    Callaghan, Jim

    Heppell, John

    Campbell, Mrs Anne (C'bridge)

    Hill, Keith (Streatham)

    Campbell, Menzies (Fife NE)

    Hinchliffe, David

    Campbell, Ronnie (Blyth V)

    Hoey, Kate

    Campbell-Savours, D. N.

    Home Robertson, John

    Canavan, Dennis

    Hood, Jimmy

    Cann, Jamie

    Hoon, Geoffrey

    Carlile, Alexander (Montgomry)

    Howarth, George (Knowsley N)

    Chisholm, Malcolm

    Howells, Dr. Kim (Pontypridd)

    Clapham, Michael

    Hoyle, Doug

    Clark, Dr David (South Shields)

    Hughes, Kevin (Doncaster N)

    Clarke, Eric (Midlothian)

    Hughes, Robert (Aberdeen N)

    Clarke, Tom (Monklands W)

    Hughes, Roy (Newport E)

    Clelland, David

    Hughes, Simon (Southwark)

    Clwyd, Mrs Ann

    Hutton, John

    Coffey, Ann

    Illsley, Eric

    Connarty, Michael

    Ingram, Adam

    Cook, Frank (Stockton N)

    Jackson, Glenda (H'stead)

    Cook, Robin (Livingston)

    Jackson, Helen (Shef'ld, H)

    Corbett, Robin

    Jamieson, David

    Corbyn, Jeremy

    Janner, Greville

    Corston, Ms Jean

    Jones, Barry (Alyn and D'side)

    Cousins, Jim

    Jones, leuan Wyn (Ynys Môn)

    Cryer, Bob

    Jones, Jon Owen (Cardiff C)

    Cunningham, Jim

    Jones, Lynne (B'ham S O)

    Cunningham, Rt Hon Dr John

    Jones, Martyn (Clwyd, SW)

    Dafis, Cynog

    Jowell, Tessa

    Dalyell, Tam

    Kaufman, Rt Hon Gerald

    Darling, Alistair

    Keen, Alan

    Davidson, Ian

    Kennedy, Jane (Lpool Brdgn)

    Davies, Bryan (Oldham C'tral)

    Khabra, Piara S.

    Davies, Rt Hon Denzil (Llanelli)

    Kilfoyle, Peter

    Davies, Ron (Caerphilly)

    Kinnock, Rt Hon Neil (Islwyn)

    Denham, John

    Kirkwood, Archy

    Dewar, Donald

    Leighton, Ron

    Dixon, Don

    Lestor, Joan (Eccles)

    Dobson, Frank

    Lewis, Terry

    Donohoe, Brian H.

    Litherland, Robert

    Dowd, Jim

    Livingstone, Ken

    Dunwoody, Mrs Gwyneth

    Lloyd, Tony (Stretford)

    Eagle, Ms Angela

    Llwyd, Elfyn

    Eastham, Ken

    Loyden, Eddie

    Enright, Derek

    Lynne, Ms Liz

    Etherington, Bill

    McAllion, John

    Evans, John (St Helens N)

    McAvoy, Thomas

    Ewing, Mrs Margaret

    McCartney, Ian

    Fatchett, Derek

    Macdonald, Calum

    Faulds, Andrew

    McFall, John

    Field, Frank (Birkenhead)

    McKelvey, William

    Fisher, Mark

    Mackinlay, Andrew

    Flynn, Paul

    McLeish, Henry

    Foster, Rt Hon Derek

    McMaster, Gordon

    Foster, Don (Bath)

    McNamara, Kevin

    Foulkes, George

    McWilliam, John

    Fraser, John

    Madden, Max

    Fyfe, Maria

    Mahon, Alice

    Galbraith, Sam

    Mandelson, Peter

    Galloway, George

    Marek, Dr John

    Gapes, Mike

    Marshall, David (Shettleston)

    Garrett, John

    Martin, Michael J. (Springburn)

    George, Bruce

    Martlew, Eric

    Gerrard, Neil

    Maxton, John

    833

    Meacher, Michael

    Salmond, Alex

    Michael, Alun

    Sedgemore, Brian

    Michie, Bill (Sheffield Heeley)

    Sheerman, Barry

    Michie, Mrs Ray (Argyll Bute)

    Sheldon, Rt Hon Robert

    Milburn, Alan

    Shore, Rt Hon Peter

    Miller, Andrew

    Short, Clare

    Mitchell, Austin (Gt Grimsby)

    Simpson, Alan

    Moonie, Dr Lewis

    Skinner, Dennis

    Morgan, Rhodri

    Smith, Andrew (Oxford E)

    Morris, Rt Hon A. (Wy'nshawe)

    Smith, C. (Isl'ton S & F'sbury)

    Morris, Estelle (B'ham Yardley)

    Smith, Rt Hon John (M'kl'ds E)

    Morris, Rt Hon J. (Aberavon)

    Smith, Llew (Blaenau Gwent)

    Mowlam, Marjorie

    Snape, Peter

    Mudie, George

    Soley, Clive

    Mullin, Chris

    Spearing, Nigel

    Murphy, Paul

    Spellar, John

    Oakes, Rt Hon Gordon

    Steel, Rt Hon Sir David

    O'Brien, Michael (N W'kshire)

    Steinberg, Gerry

    O'Brien, William (Normanton)

    Stevenson, George

    O'Hara, Edward

    Stott, Roger

    Olner, William

    Strang, Dr. Gavin

    O'Neill, Martin

    Straw, Jack

    Orme, Rt Hon Stanley

    Taylor, Mrs Ann (Dewsbury)

    Parry, Robert

    Tipping, Paddy

    Patchett, Terry

    Trimble, David

    Pendry, Tom

    Tyler, Paul

    Pickthall, Colin

    Vaz, Keith

    Pike, Peter L.

    Walker, Rt Hon Sir Harold

    Pope, Greg

    Wallace, James

    Powell, Ray (Ogmore)

    Walley, Joan

    Prentice, Ms Bridget (Lew'm E)

    Wardell, Gareth (Gower)

    Prentice, Gordon (Pendle)

    Wareing, Robert N

    Prescott, John

    Watson, Mike

    Primarolo, Dawn

    Welsh, Andrew

    Purchase, Ken

    Wicks, Malcolm

    Quin, Ms Joyce

    Wigley, Dafydd

    Randall, Stuart

    Williams, Rt Hon Alan (Sw'n W)

    Raynsford, Nick

    Williams, Alan W (Carmarthen)

    Reid, Dr John

    Wilson, Brian

    Rendel, David

    Winnick, David

    Richardson, Jo

    Wise, Audrey

    Robertson, George (Hamilton)

    Worthington, Tony

    Robinson, Geoffrey (Co'try NW)

    Wray, Jimmy

    Roche, Mrs. Barbara

    Wright, Dr Tony

    Rogers, Allan

    Young, David (Bolton SE)

    Rooker, Jeff

    Rooney, Terry

    Tellers for the Noes:

    Ross, Ernie (Dundee W)

    Mr. Alex Meale and

    Rowlands, Ted

    Mr. Dennis Turner.

    Ruddock, Joan

    Question accordingly agreed to.
    It being after Ten o'clock, further consideration of the Lords amendments stood adjourned.

  BUSINESS OF THE HOUSE
  Motion made, and Question put forthwith, pursuant to Standing Order No. 14 ( Exempted business),
  That, at this day's sitting, the Lords Amendments to the Trade Union Reform and Employment Rights Bill and the Ways and Means Motion may be proceeded with, though opposed, until any hour.—[Mr. Conway.]
  Question agreed to.

  TRADE UNION REFORM AND EMPLOYMENT RIGHTS BILL
  Lords amendments again considered.
  Further consideration of Lords amendments adjourned.—[Mr. Conway.]
  To be further considered tomorrow.

Ways and Means

  Crime (Expenditure)
  Motion made, and Question proposed,
  That provision may be made preventing expenditure involving crime being deducted or being included in expenses of management.—[Sir John Cope.]
  10.16 pm
  Mr. Alistair Darling: I shall raise a short point in what I imagine will be a relatively short debate.
  The resolution is in general terms, as are all such resolutions. Although its scope is comparatively wide, there must be some limit to exactly how wide it is intended to go. Its purpose is to allow the Government to table amendments to the Finance Bill, which is currently being considered in Committee, to strike at certain payments being claimed as expenses when such payments might involve crime.
  The point that I shall address involves the definition and scope of such payments when considering the question of preventing expenditure involving crime. There may well be circumstances in which payments may be claimed as an allowable expense or deduction in the expense of management against the Revenue. For example, I want to know whether it will be possible, within the scope of the resolution, to table amendments that might help the Inland Revenue to identify payments that may not have been claimed as such, although in reality they are payments in connection with crime.
  I can envisage a situation in which someone wishes to claim an expense but, for whatever reason, he or she is not willing to disclose the true nature of it. Therefore, I should like the Minister to tell us whether he anticipates that it will be possible within the scope of the resolution to table an amendment or new clause that would require a recipient of a payment to disclose that the payment had been made.
  I have two examples in mind. First, I refer to the case of the Bank of Credit and Commerce International. The Inland Revenue and, indeed, others have had reason to question whether many of the payments that have been made are legitimate and whether they are an allowable expense. Clearly, if the recipients of those payments had had to declare the source of them, the job of the Inland Revenue would have been made that much more easy.
  The other case is perhaps a live issue. It concerns donations that may have been made by an individual when he or she was insolvent or an individual who may have caused a company over which he or she had control to make payments that involved crime. I have in mind in particular, for example, donations made to a political party where the political party at the time it received the payment may have had no reason to believe that it could have come from money resulting from crime but subsequently realised that that was the case. If, for example, political parties were required to list the sources of donations and payments received, it would make it much easier for the Revenue and other authorities to see where the money had come from and to determine whether it involved crime, as envisaged in the resolution.
  Mr. David Winnick: Does my hon. Friend agree that a political party, particularly a political

  835
  party represented in the House of Commons, should have the clear, moral and, one hopes, legal responsibility—if the Government accept what my hon. Friend is saying—to ensure that donations, and in Nadir's case substantial donations, made to it, bearing in mind the source and the creditors, are returned promptly, if only to ensure that creditors who are owed money receive it? The political party should not continue with sums which it should never have received in the first place—
  Madam Speaker: Order. The hon. Gentleman is talking outside the scope of the ways and means resolution.
  Mr. Darling: I anticipated that at some point, Madam Speaker, you might be moved to make that point, which is why I have tried to contain my remarks within the constraints of the resolution.
  I think that I am entitled to ask whether within the scope of the resolution it would be possible for us to to table an amendment requiring a political party to disclose the source of its donations. If it is, we most certainly will do so within the scope of the Finance Bill. I should be grateful if the Paymaster General will let us know what exactly he had in mind in drafting the resolution as he has. It mentions "preventing expenditure involving crime". That seems to be a wholly laudable and praiseworthy objective. Did he have in mind a political party which might receive money that may have come from crime? Do the Government have in mind that resolutions might be tabled to strike at the present practice where payments can be made and political parties are not obliged to reveal the source of the payments, which makes it that much more difficult not just for the Revenue but for the public to draw their conclusions about the nature and characteristics of the recipient, in this case the political party that has received these sums?
  10.22 pm
  Mr. Bob Cryer: It would have been helpful to the House if the Paymaster General, instead of trying to get the resolution through on the nod, had explained its content and purpose. That would have helped Members who are seeking to find out the Government's aim in tabling the resolution. Certainly, on the face of it, it is laudable. As the House knows, it is linked to the Finance Bill Committee and what is tabled there will determine whether the resolution is of benefit. We do not know why the Government have tabled the resolution, which is why we are probing for information. If we were tabling amendments, we would be probing for information.
  I echo the sentiments of my hon. Friend the Member for Edinburgh, Central (Mr. Darling). Are the Government trying to ensure control over expenditure that is subsequently found to have been based on criminal actions to prevent it from being allowed against tax either directly or for management purposes when the management of a company or part is for criminal purposes? Or is it some other area of activity that they have in mind? Will a general clause to that effect be tabled in the Finance Bill Committee?
  Has the resolution been prompted by the fact that the Government find themselves in an extremely embarrassing position—although they are extremely hard faced about it
  836
  —because they received half a million quid from a man who was facing serious fraud charges? There is no doubt that there must have been some allocation of expenditure in Asil Nadir's company, either directly by that company, or through management expenses, that was involved in criminal activities. No doubt the company was seeking to set those activities against corporation tax. I have no doubt that the resolution is concerned precisely with that point.
  If the Government are tabling the resolution to close a loophole, that is welcome to the Labour party and, I hope, to Conservative Members. I hope that they are ashamed that they have been financed by the criminal activities of Polly Peck.
  Mr. David Ashby: What about Robert Maxwell?
  Mr. Cryer: If Maxwell had been found out earlier, criminal charges might have been levied against him.
  If a clause based on the resolution had been passed in a Finance Bill some years ago, any illegal expenditure of a criminal nature by Robert Maxwell would have been revealed in Labour party accounts. The difficulty is that nothing is shown in the Conservative party accounts, because it does not hold them. That is a source of concern not only to Opposition Members but, I very much hope, to Conservative Members.
  Mr. Ashby: The Home Affairs Select Committee heard evidence only last week from one gentleman who had asked the Labour party time and again for the source of its funding. It refused to tell him who was donating to it. The hon. Gentleman has got his party quite wrong; it is the most secretive party in the country.
  Mr. Cryer: I am not going down roads that would bring me into possible conflict with you, Madam Speaker. I will not get involved in arguments concerning the Home Affairs Select Committee.
  I am concerned about the resolution. It should allow the Government to table a clause to the Finance Bill to prevent expenditure involving crime being deducted for tax purposes or included in the expenses of management. If legislation based on the resolution is to have effect, however, the Inland Revenue must know about such expenditure. It cannot know if the necessary information is not provided.
  Since a current case is based on the activities of Asil Nadir, it is legitimate to ask why the Conservative party is not prepared to publish its accounts.
  Recent revelations have also been made about commercial lobbying organisations. Lobbying is part of the management exercise, because managements use commercial lobbyists. It is quite clear that Asil Nadir used such an organisation to get to the heart of Government by making representations to the Minister of State, Northern Ireland Office, the hon. Member for Hampshire, East (Mr. Mates), and the President of the Board of Trade, the right hon. Member for Henley (Mr. Heseltine). The resolution will prevent the expenditure of commercial lobbying organisations.
  Mr. Don Dixon: What about the watch?
  Mr. Cryer: I am not sure whether that would be considered a management expense.

  837
  Commercial lobbying organisations are used extensive-ly in this place and it is time that that stopped. I t is also time that the report of the Select Committee on Members' Interests, published nearly two years ago, was debated in this place. That is another matter, however, which I am not prepared to discuss because it is outside the scope of the resolution.
  There are some important issues involved. It would have helped if, instead of simply trying to allow the measure to slide through on the nod, as I anticipate the Minister hoped, he had explained its purpose. Can he assure the House that, if amendments are tabled in the Committee considering the Finance Bill that ensure that full account is given by political parties when they receive various donations—as they all do—the general public and particularly the Inland Revenue can check whether any criminal activity is involved? They will gain the information retrospectively and, when anyone is found to be conducting criminal activities, it will be possible to ascertain whether any claims are being made for allowance against taxation or management expenses.
  If the Government are seeking to save face by not introducing legislation that directly requires all political parties to publish their accounts, we will shrug our shoulders and say that the Government are trying to look a little more dignified in the face of adversity, but we welcome the legislation. If the Government are not introducing the legislation for that purpose, will the Minister assure us that, in Committee, the Government will not oppose such a proposal, which is tabled in the interests of full, democratic accountability and ensures that expenditure or management expenses involving crime are not allowable against tax? That must be a laudable aim, and I expect all Conservative Back Benchers to welcome that attitude—if it is the Government's attitude.
  I hope that it is the Government's aim, and I look forward to comprehensive assurances from the Minister on that matter. It is time that the Government took action to get rid of the sleaze that is currently engulfing them. It is a form of corruption of the political processes in this country which is bringing into disrepute, not only the Conservative party, but perfectly honest and decent members of the Conservative party who are completely opposed to it. They are also being engulfed in sleaze.
  10.32 pm
  Mr. Peter Bottomley: I suspect that the hon. Members for Edinburgh, Central (Mr. Darling) and for Bradford, South (Mr. Cryer) would not be popular if the Daily Mail newspaper group found that it could not obtain tax relief on the payments that it is having to make to its pension fund to make up for the money that was stolen from the fund.
  I suspect that my right hon. Friend the Paymaster General will tell the House that the measure will provide a ways and means cover for an amendment which I believe, following correspondence that I have had with my right hon. Friend, is likely to be tabled. The amendment would be designed to ensure that, if a business is feeling forced to make illegal payments for illegal purposes to an outside organisation, that will no longer be liable for tax relief. If the measure is as simple as that, I think that the Opposition would want to support it.
  10.33 pm
  Mr. Roger Evans: Does the resolution involve any change in the practice of the Inland Revenue in disclosing information about taxpayers' affairs to the police and the prosecuting authorities? In tribute to the late Sir Alan Herbert, who made great sport in literature from the anomalies involved in taxing prostitution and suggested that the commissioners of the Inland Revenue could be prosecuted for living off immoral earnings, may I ask whether any change in practice in that aspect of the law is envisaged?
  10.34 pm
  The Paymaster General (Sir John Cope): The answer to both questions of my hon. Friend the Member for Monmouth (Mr. Evans) is no. There is no change in practice in relation to disclosure to the police or immoral earnings.
  The purpose of the resolution is to permit the Government to introduce what now appears as new clause 8 on the Finance Bill amendment paper relating to expenditure involving crime. That is the amendment's sole purpose. It is not for me to define the scope of the resolution in full. If hon. Members have suggestions which they think are within the remit of the resolution and the House is wise enough to pass it, they must see what they can do to carry through their suggestions.
  Nothing in the motion extends the Revenue's powers to seek information, and I remind the House that political donations are disallowed for tax purposes. The proposed new clause does not apply in any way to that matter.
  The hon. Member for Edinburgh, Central (Mr. Darling) asked for information to be made available not just to the Inland Revenue but to the public on the source of donations. I remind the hon. Gentleman that all information that the Inland Revenue receives about the affairs of taxpayers is rightly confidential. That is how it should be and how it will remain.
  Mr. Darling: I would certainly not advocate that the Inland Revenue should disclose the affairs of a taxpayer to anyone who is not entitled in law to receive such information. I said that if political parties had to disclose the source of their money in a register that was open to inspection by the public, both the Inland Revenue and the public could see who had made payments. If the Revenue or another authority suspected that payments had been made by someone who they suspected was engaged in illegal activity, they could follow the payment from source to clarify matters. I seek a degree of openness, especially by the Conservative party in the light of what has happened to its donor Mr. Asil Nadir.
  Sir John Cope: The proposed new clause and the resolution that makes it possible do not address that point for any political party, nor should they in the context of tax legislation. The resolution will ensure the introduction of new clause 8, which is in the selection list of the Committee. That clause would allow the Revenue, when computing income for tax purposes, to disallow payments which themselves constitute the commission of a criminal offence by the payer. They would be bribes of one sort or another contrary to the Prevention of Corruption Act 1916 and the prevention of terrorism Act. The new clause is carefully directed.
  Mr. Cryer: Would it be applicable to someone who wanted to procure a knighthood or other honour by way of political donations? That sort of thing happens. As it is a crime involving the corruption of public bodies, it would surely be covered by the resolution's general proposal.
  Sir John Cope: That may be so if the payment constituted a criminal offence in the circumstances that the hon. Gentleman suggests. If it did, it would be covered by the new clause.
  Mr. Winnick: I understand that the resolution tries to ensure that companies do not profit from crime. For that reason, we obviously welcome it, and that will be made clear in future debates on the Finance Bill. Would not it be consistent to make it clear that political parties should not profit from crime? The Government rightly say that companies should not profit from crime. If there is any evidence that a party, say, the Conservative party, has received money from a criminal source to buy a knighthood or anything else, should not that party make sure that the money is returned? I refer to the Nadir business, because the Conservative party has undoubtedly received money from a corrupt and criminal source.
  Sir John Cope rose—
  Madam Deputy Speaker (Dame Janet Fookes): Order. Before the Minister replies to that intervention, may I say that an extremely narrow point is being debated. I hope that it will not provide a platform for a general and irrelevant debate.
  Sir John Cope: I think that the hon. Gentleman has misunderstood the point of the new clause, which is to attack not a company that profits from crime but a payment made by a company, which is not a profit but a loss as it is a payment. It refers to a payment which a company or an individual makes which itself constitutes a criminal offence. The hon. Gentleman has misunderstood the purpose of it. It is the other way round. It may be that
  840
  he did not misunderstand it but was trying to make another point. If I responded to it, I would fall foul of the strictures of the Chair, and I am not prepared to do that.
  Question put and agreed to.
  Resolved,
  That provision may be made preventing expenditure involving crime being deducted or being included in expenses of management.

PETITION

  Pensions (Payment)
  10.39 pm
  Mr. Rhodri Morgan: This petition has more than 4,000 signatures and has been collected on the street and door to door and in post offices in my constituency of Cardiff, West following the way in which pensioners and others were scandalised and put into a state of deep anxiety by the pilot project by the Department of Social Security to change the method of payment of pensions and benefits from payment via the Post Office to payment by automatic credit transfer to banks and building society accounts.
  I shall read out the petition, having described it briefly. It states:
  We, the undersigned wish to express our opposition to any proposals implemented by Her Majesty's Government which would result in the public not having the right to have their state pensions and benefits paid through the Post Office. We believe that the freedom to have them paid through the Post Office is vital and that the Post Office performs a central function to those who currently collect their benefits and pensions from it and that the withdrawal of this right will involve the closure of many post offices and sub post offices which are vital to communities and to the people who currently use them. We therefore request that the House of Commons urge Her Majesty's Government to withdraw its proposals and continue to allow payment of pensions and benefits through the Post Office.
  To lie upon the Table.

  Standish Hospital, Stroud
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Andrew Mitchell.]
  10.41 pm
  Mr. Roger Knapman: I am grateful for the opportunity to initiate the debate. I apologise to you, Madam Deputy Speaker, for keeping you up half an hour longer than might otherwise be the case and hope you will forgive me. In all probability, if I had not done so somebody else would have done so.
  I am also grateful to my hon. Friend the Minister for attending the debate. I am sure that, as Parliamentary Under-Secretary of State for Health, he is a veteran of such occasions. Finally, I thank my hon. Friend the Member for Norwich, North (Mr. Thompson), the Parliamentary Private Secretary to the Minister of State. If he does not mind my referring to him as a conduit. he is a very efficient conduit in a Department where it is important that there should be close liaison between Ministers and Back Benchers, and I thank him for his efforts.
  May I now voice some concern about the proposals to close Standish hospital which is situated in my constituency between Stroud and the city of Gloucester and replace it with a new extension to the Gloucestershire Royal hospital.
  1 will, of course, leave my hon. Friend plenty of time to respond. I know that he is always grateful for such thoughtfulness. To ensure that, I shall first make four main points so that we can concentrate on the four or five other points which may be fractionally more contentious.
  First, I acknowledge that most of the medical consultants support the proposals. Anybody who has read the response to the consultation document will have the utmost regard to the comments by doctors Prior, Durkin and Uff and others which must be of concern to us all.
  I also recognise that, for obvious reasons, acute provision units should, wherever possible, be on one site. I know of one particular circumstance in Gloucestershire when an elderly man was taken to Standish, suffered a heart attack and subsequently had to be taken on to Gloucestershire Royal hospital. There have been other such cases.
  Thirdly, I understand that the choice between the existing Standish hospital and a new hospital is not, as some people suggested, cost cutting. If we are not to make use of the £10 million or so for capital improvements, someone else in another area will no doubt be very glad to do so.
  Fourthly, we all recognise that Standish is not a community or a cottage hospital but is an acute services unit serving a large part of the county. When I visit the hospital, not least at Christmas, I meet a number of the patients there and they are just as likely to come from the constituency of my hon. Friend the Member for Gloucester (Mr. French) or from the Forest of Dean, represented so ably by my hon. Friend the Member for Gloucestershire, West (Mr. Marland). There are patients from large areas of the county including my constituency.
  As we are all in agreement up to this point, I hope that my hon. Friend the Minister will forgive me if, despite my introductory remarks, I come to the considerable level of public concern about the proposals for Standish hospital. The crux of the matter is that the general public like
  842
  Standish hospital. They like it for its setting, its staff, its friendliness and its efficiency. If they have a hospital that they like and with which, in the main, they are satisfied, they want to be sure that the proposals will lead to further improvements.
  Many local people and their relatives have been treated at the hospital over decades, perhaps more than one generation in some families. Most are satisfied and regard the hospital with considerable affection. The very active league of friends attests to that. I or anybody else could deposit an elderly relative at the hospital and drive away knowing that the patient would receive prompt and excellent treatment in a well-equipped and efficient unit.
  Following conversations with my hon. Friend the Under-Secretary, I am grateful to him for the considerable interest that he has shown, particularly in view of his many and heavy responsibilities. He will substantially know the arguments advanced by the district health authority and the response by the community health council which has to represent the public interest and has done so well.
  Having painted in the background to the matter, I wish to ask my hon. Friend a few questions which, if he cannot or will not answer tonight, I hope he will respond to later. First, I have already mentioned that the local population likes Standish. Many people can identify with a smallish unit in a rural setting, but few really like the large tower block hospitals in city centres which sometimes have parking problems.
  In those circumstances, having heard the views in the consultation document of the professionals and consultants, does my hon. Friend agree that the views of the general public should also be taken into account? Does my hon. Friend agree that Standish is set in a particularly attractive rural location on an eminence overlooking the Severn valley with extensive grounds and, as one would expect from what was originally a TB hospital, a pure air? All that amounts to a considerable help to patients for their rapid recovery and recuperation.
  How can one measure those benefits? Will my hon. Friend attempt to do so? That is the major point which convinced some 20,000 of my constituents, and perhaps a few beyond the boundary, under the guidance of the Save our Standish campaign, to sign a petition. I cannot say that I counted the 20,000 names, but I can confirm that that petition had no chance of fitting in the bag behind the Speaker's Chair. When we unrolled it, it broke several times and I am grateful to the House of Commons staff who deal with petitions for their forbearance for half an hour or more.
  Although consultants back the proposals, not all GPs do. A local GP wrote to me as follows:
  "I have been a general practitioner in Stroud for thirty-five years, during which time a great number of my patients have made use of the facilities at Standish Hospital, mostly as in patients, but, sometimes, by using the physiotherapy or hydrotherapy departments as out-patients … my strong impression is that Standish is highly valued because of its convenience for patients and visitors alike, its beautiful and morale boosting surroundings, the quality of its treatment, and the consistent kindness of all its staff, medical, nursing and ancillary. There have been very few complaints, if any. For local GPs, Standish has provided a much valued alternative for emergency admissions, of patients with acute respiratory disorders in particular, when other hospitals (Gloucester Royal and Stroud General) are reluctant to admit because of pressure on beds. We have been told that major surgery should not continue at Standish, because the lack of intensive care facilities makes it hazardous. It is difficult to comprehend why this should become a consideration now,

  843
  after forty years of successful orthopaedic surgery. In summary, my strong impression is that Standish Hospital is highly valued by patients, their relatives, and general practitioners locally, and that its services would be greatly missed if it was closed."
  I am not suggesting that all GPs think like that, but a number of GPs—and a huge section of the general public —have written in similar terms. I hope my hon. Friend will confirm that their views will be taken into account.
  Will my hon. Friend give careful consideration to the community health council's report, particularly the recommendations in paragraph 3.2, under the heading "Capital Savings"? The CHC concludes:
  "More consideration should be given to the Health Authority's forecast of £9·5m to transfer services, when the cost to retain services at Standish"

  would be only £4·8 million.
  "The potential saving, on interest and capital charges, could be usefully employed in the provision of services with a higher priority."
  What consideration has been given to that point? If some £4·8 million would indeed provide a first-class hospital on the existing site at Standish, would that be a suitable alternative to the present proposals? I hope that my hon. Friend will consider that carefully before any final decision is made.
  I have already paid tribute to the professionalism and dedication of the hospital's staff. Will a substantial proportion of those staff—who, over the past few years, have been welded into a very successful team—be prepared to travel to the Gloucestershire Royal and work in the new unit? Can my hon. Friend confirm that all the facilities currently at Standish will be provided at the Gloucestershire Royal extension? If not, what aspects of provision will not be available? Has full agreement been reached with the consultants with regard to those facilities?
  That is quite a list of questions, and I promised my hon. Friend plenty of time to reply to them. I assure him that these matters are considered to be very serious in Gloucestershire: indeed, on occasion they are considered matters of life and death. I am sure that my hon. Friend will provide for a thorough and exhaustive inquiry. I shall support him fully, because I know that he will decide the issue on medical rather than political grounds.
  10.54 pm
  The Parliamentary Under-Secretary of State for Health (Mr. Tom Sackville): I congratulate my hon. Friend the Member for Stroud (Mr. Knapman) on having secured this debate on the proposed transfer of services from Standish hospital to the Gloucestershire Royal hospital. My hon. Friend presented his case with his typical skill and demonstrated his care for his constituents' interests.
  I shall set out briefly the current position on the proposal to transfer services. As my hon. Friend knows, a major review of services at Standish hospital was undertaken in 1987 by the former Gloucester health authority, in conjunction with clinicians, professionals and representatives from the Cheltenham district health authority. At that time, there were also recommendations from the Royal College of Physicians. The review recommended the reprovision of acute services at Gloucestershire Royal hospital and the subsequent closure of Standish.
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  My hon. Friend will know about the approval of that recommendation by the health authority and the objection of the community health council. It was passed to the regional health authority and is now in the hands of my right hon. Friend the Secretary of State for a decision. I assure my hon. Friend that my right hon. Friend will take full account of all the comments that she receives on the proposal before making a decision.
  I am aware that Standish is a small and friendly hospital, located in an attractive setting. I am also aware —my hon. Friend mentioned this—of the activities of the league of friends which raises funds for the hospital, together with 60 or more local volunteers who provide the trolley shop and other assistance at the hospital. For all those reasons, I am sure that no health authority will take a decision lightly about a much-loved hospital.
  I understand that the overriding reasons for the proposal are based on medical recommendations, some of which were mentioned by my hon. Friend. Standish has, as has been said, 120 acute beds, including orthopaedics, chest medicine and rheumatology. It has no intensive care facilities. In the event of an emergency, the patient must endure a difficult and possibly dangerous transfer to the intensive therapy unit at Gloucestershire Royal. Also, Standish is too small to have its own specialists in all the various branches of acute medicine. That requires the transfer of acutely ill patients at times to the Gloucestershire Royal. I understand that, on average, one patient a day is transferred for other services.
  Another key medical reason for reproviding the current services on a site with intensive care facilities is that a much wider range of patients than is at present allowed could benefit from major joint replacements. Those patients would be those who need pre-operative intensive care stabilisation of chronic conditions followed by postoperative intensive care monitoring. The point about intensive care is particularly apt in the case of an elderly and aging population who may require a higher level of high-tech back up.
  Another medical reason is that there are no medical consultants based at Standish. Therefore, they are required to visit regularly once, twice or more each week. That results in a loss of considerable and valuable time in travelling between the two sites, which is unsatisfactory.
  The royal college has withdrawn and will continue to withdraw recognition for training in anaesthesia from any district hospital that allows unsupervised trainees to anaesthetise patients. In that context, "unsupervised" means any time that a consultant or senior registrar is not present in the hospital. Standish is provided with a consultant in anaesthesia for nine of its current allocation of 14 substantive sessions. When a consultant is away on leave, the replacement must be one of senior registrar or equivalent status. That is not always possible from the small department at Gloucestershire Royal hospital, where there is only one senior registrar and where a registrar with the fellowship diploma is a rarity.
  An additional problem that the limited pool of medical staff at Standish makes adequate 24-hour cover difficult without requiring junior doctors to work in excess of the 63-hour maximum week. Transferring services to the Gloucestershire Royal hospital would allow the new standards for junior doctors to be met as well as providing on-site support from senior medical staff.
  There can be no disagreement about the fact that Standish hospital is set in idyllic surroundings. I take my

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  hon. Friend's point about the effect that such surroundings may have on patients, although it is, of course, impossible to measure the therapeutic effect. I must add that the question of hospital design, quite apart from architecture, is a matter of considerable concern to me and, I hope, will continue to be so to the health service. However, having said that, it must be admitted that Standish hospital is, I think, five miles from Stroud and 10 miles from Gloucester. That has some ramifications for accessibility, especially for a general hospital which attracts customers —patients —from a very wide area.
  On the question of buildings and capital investment, the 1987 review, to which I have already referred, highlighted the poor condition of many of the buildings at Standish hospital, some of which date back to the early part of the previous century. One ward was in such a poor condition that it had to be replaced. The condition of the remaining estate is such that large sums of money would have to be spent to maintain the building if services remained there for very much longer.
  I very much appreciate what my hon. Friend said about the level of public concern. Standish hospital is clearly much loved, and there is considerable local feeling about it. If I were given the choice, I should want to be treated in a small hospital in attractive, rural surroundings. However, that is an ideal, and one which unfortunately cannot always be met in the real world.
  My hon. Friend mentioned clinicians. There is widespread agreement among consultants about the proposals, although many local general practitioners, who would like to continue to send their patients to Standish hospital, may have a different view.
  It is not merely a question of spending a certain sum of money on Standish hospital. To keep some acute services
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  on a relatively isolated site is not desirable or cost effective, and that is all that could be achieved as a result of minor reprovision at Standish. Services at Standish would, in the longer term, need the full support of a district general hospital. As I said, there are a number of difficulties in providing the 24-hour medical cover at Standish. It would be impractical and probably prohibitively expensive for the local health service as a whole to base staff at Standish to provide such a level of cover. I have already touched on the argument about untrained anaesthetists, and the impossibility of allowing them to be in sole charge of anaesthetised patients.
  My hon. Friend also asked whether all the facilities now available at Standish could be provided at the Gloucestershire Royal. The answer to that question is definitely yes. I am assured that all patient services could be provided at that site, and at a higher technical and clinical standard.
  As I have said, I appreciate the opportunity to make those points, especially as the matter is now before the Secretary of State for a decision. My right hon. Friend has yet to decide the future of the hospital, but I thought that it would be helpful to explain the thinking behind the district and regional health authorities' decision to put the proposals forward. I am fully aware of the strength of feeling about the hospital on the part of my hon. Friend and of local residents, and I reiterate that the Secretary of State will pay close attention to the views of all those involved, including the community health council and all other interested parties, before reaching any decision.
  Question put and agreed to.
  Adjourned accordingly at five minutes past Eleven o'clock.