Lords Sitting of 5 April 1960

Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Lichfield
The Marquess of Dufferin and Ava—Took the Oath.
The Lord Dunleath—Took the Oath.

HOSPITAL CONSULTANTS' MERIT AWARDS
2.35 p.m.
LORD TAYLOR: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government the percentage of (a) consultants, and (b) consultants aged 50 or more, employed by Boards of Governors of teaching hospitals, who are in receipt of A and B merit awards.]
LORD ST. OSWALD: My Lords, of the consultants employed by boards of governors, 33·5 per cent, are in receipt of A and B merit awards. Consultants also employed by Regional Hospital Boards are included in this figure. Her Majesty's Government regret that the information requested in the second part of the noble Lord's Question is not at present available in the form required.
LORD TAYLOR: My Lords, I wonder whether the noble Lord would be kind enough to give me the information asked for in the first part of my Question, without including the consultants and others employed by Regional Hospital Boards who are added on to the total, thereby confusing the figure at which I am trying to arrive.
LORD ST. OSWALD: My Lords, this is, to a certain extent, a continuation of the amiable but inconclusive exchange that I had with the noble Lord last Thursday, on his Questions of that day. As I understand it, the noble Lord asks for an overall figure. That overall figure is 33·5 per cent. That is the true figure
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in respect of consultants employed by boards of governors. If I were to subtract from that, as the supplementary question asks me to do, the proportion of consultants employed by boards of governors but also employed by Regional Hospital Boards, while I might be able to do that it would not be a true figure according to the noble Lord's Question to-day or his two Questions on Thursday last. If the noble Lord wishes me to mislead him in this way I will undertake this unnatural operation, though with the greatest regret; and I should like to make clear that I will do so as openly and transparently as possible.
LORD TAYLOR: My Lords, I think that the noble Lord has got it muddled again. I believe he is including in the figure persons employed as consultants by Regional Hospital Boards who are employed as registrars and in other capacities by boards of governors. Otherwise, there is no point in the noble Lord's subtraction sum. Moreover, is the noble Lord aware that a little calculation based on the tables given in the Report of the Royal Commission will show that the answer I require is 40 per cent., and that the answer to the Question which the noble Lord is unable to give is, in fact, 83 per cent.?
LORD ST. OSWALD: My Lords, naturally I am not going to tell the noble Lord that he is muddled; but he is, in fact, mistaken—
LORD TAYLOR: No.
LORD ST. OSWALD: —because the fact is that the true answer to the first part of the noble Lord's Question to-day is 33·5 per cent. If he wishes me to make a subtraction, I can do that, not in relation to this Question but in relation to the two Questions he asked me last Thursday. I then gave him the overall figure of 59·3 per cent.; and subtracting from that the proportion of consultants with merit awards employed both by boards of governors and by Regional Hospital Boards, the figure is 50 per cent.
LORD TAYLOR: My Lords, I am very interested, because I believe the figure to be 80 per cent.
LORD ST. OSWALD: My Lords, when the noble Lord questioned my figures the other day I checked them very carefully,

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and on doing so was told that my figures were absolutely correct. If the noble Lord is interested in having the second figure for which he has asked, the overall figure for consultants employed by Regional Hospital Boards is 30·9 per cent. as I told him. If we subtract from that the proportion of consultants employed both by Regional Hospital Boards and by boards of governors, the figure becomes 24 per cent.
LORD TAYLOR: My Lords, I believe the last figure is correct.
LORD ST. OSWALD: My Lords, I am delighted to hear it, but I believe that the noble Lord will find that both figures are correct.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, could a learned mathematical treatise now be published on this question so that your Lordships might clear it up?
LORD ST. OSWALD: Not from me, my Lords.
LORD CONESFORD: My Lords, is the "overall figure" what used to be called the total?
LORD UVEDALE OF NORTH END: My Lords, arising out of this Question, may I ask whether it is true that the only secret awards made by Her Majesty's Government are either in the Secret. Service Department of the Foreign Office or in the Health Service, and whether there is any parallel between the functions of these two Departments?
LORD ST. OSWALD: My Lords, I think there is absolutely no parallel whatever between those two Departments. The fact is that it was agreed that the identities of those receiving awards under the awards system, should be kept secret, if the noble Lord wishes to say so—at any rate, should not be divulged.
LORD DOUGLAS OF BARLOCH: My Lords, is not the truth of the matter that the thing will not stand up to scrutiny?

THE BISHOP OF JOHANNESBURG
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, with permission, I beg to ask the Question of which I have given Private Notice: Whether Her Majesty's Government will make a statement on the position of the Bishop of Johannesburg.
THE PAYMASTER GENERAL (LORD MILLS): My Lords, I understand that it has been agreed through the usual channels that my noble friend the Leader of the House will answer this Question in the form of a statement later this afternoon. My noble friend will also make a statement on United Kingdom persons detained in South Africa.

LORD CHANCELLOR'S VISITS TO NEW ZEALAND AND CHICAGO
2.46 p.m.
THE LORD CHANCELLOR (VISCOUNT KILMUIR): My Lords, with the leave of the House, I should like to make a personal statement. In my capacity as Lord Chancellor I have received from the Law Society of New Zealand an invitation to deliver the opening address at their Dominion Legal Conference, which is to be held in Wellington from April 19 to 22. These Conferences are held at intervals of three years, and are attended by all the leading lawyers of New Zealand. On this occasion a number of lawyers from Australia will also be present. I understand that there has been no previous instance when a Lord Chancellor has attended such a Conference. Your Lordships may think it fitting that I should take this opportunity to signify the high regard which we hold for New Zealand and for the profession of law in that country.
My attendance at this Conference makes it necessary for me to leave England on April 13. I hope to travel via Singapore, and while there to see the noble Earl, Lord Selkirk. I am sure that your Lordships would desire me to convey to him your good wishes on his important task. I should add that I have also been invited to attend Convocation at Chicago University on Sunday, May 1, in order that an honorary Degree of Doctor of Laws may be conferred upon me. It is therefore proposed that I should

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return from New Zealand by way of Chicago, arriving in England on Tuesday, May 3. As the House reassembles on Tuesday, April 26, these arrangements would involve my missing the Sittings in that week. Accordingly I ask your Lordships' agreement to my being absent from my place on the Woolsack. If your Lordships are good enough to give me this leave of absence I am sure that I shall take with me to New Zealand and to the University of Chicago the good wishes of your Lordships from every quarter of the House.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, I am sure that the whole House will welcome the request that has been made for leave by the noble and learned Viscount on the Woolsack. I do not think we ought to let this occasion pass without just saying—certainly on behalf of the official Opposition, and I think the Whole House will agree with me—that we are very greatly indebted to the present Lord Chancellor for the great devotion he has shown in the service of the House in regard to all the great number of technical matters he has had to deal with. We appreciate so much his courtesy. I believe that he is really a man of quite strong emotions, and it therefore makes us all the more filled with admiration when we see the admirable way in which he controls those emotions and the always prevailing courtesy with which he deals with our dreadful rebellions on these Benches. I hope that the two visits he is to make will be not only of great assistance to the professional men who will be gathered in these Conferences but also of great enjoyment and pleasure to himself.
LORD REA: My Lords, in the interests of unanimity I should like on behalf of the less official Opposition to echo the words of the noble Viscount. We shall all miss the noble and learned Viscount when he is away, both those to whom he is such a support and those to whom he is in opposition, and many of us to whom he is an old or a new friend. I suggest that we have much to congratulate ourselves upon in his presence in his noble capacity of Casabianca and Sir Galahad, sitting on the wool-filled sack when all but he had fled; and in
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his second rôle, his strength being as the strength of ten; and, my Lords, we all know his heart is pure.
THE LORD CHANCELLOR: My Lords, may I thank the noble Viscount who leads for the Opposition and the noble Lord the Leader of the Liberal Party in this House for those very kind words. I shall treasure them for as long as I live.

CINEMATOGRAPH FILMS (COLLECTION OF LEVY) REGULATIONS, 1960
2.50 p.m.
THE MINISTER WITHOUT PORTFOLIO (THE EARL OF DUNDEE)THE MINISTER WITHOUT PORTFOLIO (THE EARL OF DUNDEE) rose to move, That the Draft Cinematograph Films (Collection of Levy) Regulations, 1960, be approved. The noble Earl said: My Lords, I expect your Lordships would like to take these two Regulations together. The first deals with the collection of levy and the second with the distribution of the levy. The Regulations are made under Sections 2 and 3 of the Cinematograph Films Act, 1957, and they amend the Cinematograph Films (Collection of Levy) Regulations, 1957, and the Cinematograph Films (Distribution of Levy) Regulations, 1957. All they do is to provide that exhibitors showing non-standard films over 16 millimetres in width should pay levy, and that makers of certain British non-standard films of similar size should be eligible to receive levy. The change is not an extensive one. In practice it mainly affects the type of films over 35 millimetres, of which one is Todd-AO and another Cinerama.
Your Lordships may possibly remember that on Second Reading I explained why these non-standard films had not previously been subject to the levy. It was felt that when new techniques of this kind were introduced—Cinerama, for instance, has been going for only about five years—since they involved a great deal of capital expenditure it was reasonable to allow them to find their feet, and that the experiments which they involved should not be hampered as they might have been if exhibitors of these films had had to pay levy. But now it is felt that the conversion of cinemas to these new techniques has gone about as far as it it likely to go, and there no longer

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appears to be any reason why these films should be exempt from levy. The rest of the industry has always felt rather strongly that their competitors were getting away with not having to pay it; but I think it was reasonable not to impose the levy to begin with.
With regard to theatres which have been specially adapted for these new techniques, like the London Casino for Cinerama, it is not proposed to subject them to the quota. It would be unreasonable, I think, that they should have to alter the whole arrangement of their cinema programme for part of the year, at great expense, in order to fulfil a quota. They are, however, now to pay levy. If British films of this kind are made in this country, then they will be equally entitled to receive the proceeds of the levy, as well.
These proposals to bring non-standard films within the scope of the levy Regulations have been considered by the Cinematograph Films Council who must, by Statute, be consulted by the Board of Trade before Regulations are made. The Cinematograph Films Council have recommended, first, that the showing of non-standard films should now be liable for levy at the normal rates for standard films; and secondly, as a corollary, that any non-standard films meeting the labour costs and other requirements laid down for a British standard film should receive a share of the levy. These Regulations give effect to the Council's recommendations. I beg to move.
Moved, That the Draft Cinematograph Films (Collection of Levy) Regulations, 1960, be approved.—(The Earl of Dundee.)
2.54 p.m.
VISCOUNT BRENTFORD: My Lords, I venture to oppose these Regulations in their present form, and in doing so I must declare to your Lordships an interest in this matter. It is an interest which I have never had to declare before in my Parliamentary career, and I never expected to have to declare it to your Lordships' House. It is simply that I am the professional adviser to one of the companies concerned, the company which distributes and exhibits Cinerama, though I have no direct financial connection with them. If it had not been for the noble Earl's adoption of his usual
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courtesy and frankness in this matter, I might have been tempted to lay some of the blame upon him for having put me in this predicament of having to declare an interest to your Lordships, because it was largely his eloquence and his convincing argument in the Second Reading debate, to which he referred, that lulled Cinerama into such a sense of security, by being excluded from the quota system, that it was only recently brought to their attention that they were going to be included in the levy Regulations.
It is for that reason that, despite the Board of Trade having replied to the representations which were made to them with, if I may say so, unusual but commendable promptitude, there was no time for Cinerama to arrange for their point of view to be heard by your Lordships on consideration of these Regulations except through myself. I was so completely convinced that Cinerama was not to be included in these Regulations that I ventured to undertake the burden of attempting to submit their point of view to your Lordships in order that your Lordships might come to your own conclusion.
The brief point, as the noble Earl has clearly said, is that hitherto the levy has been collectable from the exhibitors of films which included only up to the standard films of 35 millimetres. I agree that that definition required amendment, because so much has developed in the cinema industry since the definition was created that it is no longer applicable. But now the noble Earl has, in my submission, swung too far the other way, and he has opened the door so that the levy is collectable from the exhibitors of all films which exceed 16 millimetres. It is a point to make, I think, that he could easily have amended the draft before now, had he so desired to exclude Cinerama, by limiting the upward measure to films which do not exceed 100 millimetres in width. I think, however, it is perfectly fair to say, as the noble Earl has already said, that it is recognised that there is no mistake here and it is the intention that the Regulations shall be made to apply to Cinerama.
Having, I hope, come to agreement that the Regulations include Cinerama, and that there would be no difficulty in excluding Cinerama, if your Lordships so thought fit, one really comes to the

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64,000 dollar question of whether Cinerama is justified in considering that it should be excluded from this levy. In my submission to your Lordships, there is no question about it whatever, because Cinerama is not an ordinary sort of film: it is something which is entirely exceptional and to which the normal considerations of the film industry do not apply.
Your Lordships are well aware, for instance, of the way in which films are distributed in this country. If you take the big feature films, as they are called, the expensive ones, they are given a run at a West End London cinema for a matter of a few weeks; they then go on circuit throughout the country and are distributed throughout all the provinces, and Scotland and Wales as well, in cinemas where they are seen by the public for up to a week at a time, and sometimes for three days. That is tone great difference, indeed, because Cinerama is shown at one theatre only in England; that is, as the noble Earl said, the London Casino. It is shown at that theatre only because it is an exceedingly costly process, as the noble Earl indicated, to convert a theatre for use by Cinerama: in fact, it costs some £50,000 for that purpose. Consequently, it is not the intention, nor has it ever been envisaged, that Cinerama shall go on circuit like an ordinary film and be seen throughout the country in other theatres.
And this is not exceptional to this country, my Lords. It is the circumstances of Cinerama itself. Excepting countries which are virtually continents in themselves—such as America, where there are several Cinerama theatres, and Australia, where there are two Cinerama theatres—I think Spain (and that for special reasons) is the only country which has more than one Cinerama theatre. In all, there are some thirty Cinerama theatres in the whole world; and if your Lordships will compare that with the total number of cinemas that there are throughout the whole world, you will appreciate the magnitude of the difference in that respect.
My Lords, that is a feature which applies to no other entertainment which is connected in any way with the film industry. The makers of other films of above standard size which have been
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developed have been able to make arrangements whereby they can be distributed in the normal way of films, but there is no anticipation of there being any possibility whatsoever, for technical reasons, of Cinerama being so distributed. Another point as your Lordships will appreciate is that the form of entertainment is something completely different. As I was saying just now, the public normally have the opportunity of seeing an ordinary film for a week in any given place. Cinerama runs in the same place for two years. That is the average length of the run of Cinerama: and it is a definite tourist attraction which is visited by people who come to London, whether from overseas, from Scotland or from the provinces. That is another reason why it is not intended, even if it were possible, that Cinerama itself should circulate throughout the country. It is, indeed, a unique venture, and it is something which is not in any way connected with the ordinary film industry as we understand it. Yet, if it is made subject to the levy, it will become involved in granting a subsidy to that very film industry. It seems exceedingly unfair that it should be subject to the collection of a levy for the benefit of the film industry as a whole, but should be excluded from any hope or anticipation of being able to benefit from that levy.
The noble Earl was perfectly right—and, if he will allow me to say so, was quite justified—in saying that Cinerama would become entitled to benefit from the levy if it produced a British film. I entirely agree; but I think my noble friend probably had his tongue in his cheek when he said that, because he must know as well as I do that it is quite impossible for Cinerama to become a British film. There are many reasons for that—largely of a technical nature, but some not technical. One, for instance, is that (as your Lordships who are familiar with these matters know) when a film is being made it is necessary for what are called "rushes" to be examined in order to see that the shooting of the film has come out satisfactorily, or whether it must be shot again. There is no facility in this country for processing a Cinerama film at the present time. Indeed, except for the London Casino, there is no facility even, for seeing a "rush" of a Cinerama film; and ob-

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viously it would not be practicable to show "rushes" during production work at the one and only Cinerama theatre that is available in this country. That is one point.
Another point is somewhat technical; that is, that there are seven sound tracks to a Cinerama film, which connect with 47 loudspeakers. That is something which does not happen in any other form of film production in the world. There is no other form of film which has so many sound tracks; and the apparatus necessary to score a Cinerama film is exceedingly complicated and, in fact, does not exist in this country at all. I am advised that to create and instal such machinery would of itself cost £250,000. That is something which obviously could not be contemplated in this country, when a Cinerama film is made, at the most, about every other year, so that for the rest of the time that expensive apparatus would be lying idle. Moreover, as your Lordships will appreciate if you have seen it, Cinerama is an international form of entertainment. It cannot be made in any one country, because the whole concept of it is to compare different parts of the world in the one entertainment. Consequently, to anticipate the creation of a British film in Cinerama is to anticipate an impossibility.
I do not wish to detain your Lordships any longer, save to deal with one point which the noble Earl made with regard to the recovery of the capital cost. That argument, so far as it goes (your Lordships will recall it) is very true, but it goes only as far as the exhibition of Cinerama. It may well be that the capital cost of the conversion of the London Casino has by now been recovered, but that is only one aspect of the capital cost involved. For the reasons I have indicated, the capital cost of the production of Cinerama is necessarily exceedingly expensive, and the outlets through which that cost can be recovered—namely, the thirty or so Cinerama theatres throughout the world—are so limited that the royalty which the producers have to impose upon the exhibitors is exceedingly high. In consequence, as your Lordships may have already felt personally, the cost of seats for Cinerama is proportionately very much higher than the average cost of seats at any ordinary cinema.
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I therefore submit to your Lordships that Cinerama is something which is quite exceptional. It is not part of the film industry in the ordinary sense. Indeed, logically, there is no greater justification for the imposition of the levy upon Cinerama for the benefit of the cinema industry than there would be for the imposition of the levy upon, for instance, something like My Fair Lady, again for the benefit of the film industry. I therefore submit to y our Lordships that the Regulations in their present form ought not to be passed, but that my noble friend should introduce into them a very minor Amendment. That is all that would be necessary, because there can be no other film of the magnitude of Cinerama, in excess of 100 millimetres, within the foreseeable life of, I think, any of your Lordships present here today. A simple Amendment of that sort would therefore preserve the position for Cinerama, and I submit to your Lordships that that should be done.
3.9 p.m.
THE EARL OF DUNDEE: My Lords, I am grateful to the noble Viscount, Lord Brentford, for his kindness in giving me notice that he intended to raise this matter on behalf of the Cinerama exhibitors, and I am also grateful for the very moderate and clear way in which he has put forward his case. He is quite right in saying that we could, if we thought it fair and just, exclude Cinerama from these Regulations by limiting them to films with a width of not more than 100 millimetres instead of to those with a width of anything over 16 millimetres; or something of that kind. We could manage to exclude it. But the Cinematograph Films Council and the Board of Trade agree that it would not be right to exclude Cinerama permanently from the levy. I have given your Lordships reasons why we thought it was justifiable while the industry was establishing itself here to exclude it; but it is not considered justifiable to extend that exclusion indefinitely.
My noble friend gave two reasons why he thought Cinerama should not be brought under the levy. One was that he represented that it was a different kind of entertainment altogether. At the moment, of course, it can be shown only at the London Casino. But I do not think I would necessarily accept that never at any time in any of our great

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provincial cities in other parts of England and Scotland can they ever afford to spend £50,000 on adapting a theatre to show films of this kind. I do not think we could take it as axiomatic that the same Cinerama film could never be shown in other parts of the country besides London. But even as it is now, the rest of the film industry decidedly regard Cinerama as a competitor. After all, it is a form of entertainment which is produced by making films; it is not produced in the same way as My Fair Lady was produced; it cannot be described as live theatre. And the Board of Trade, on the advice of the Cinematograph Films Council, feel that it would be unfair to the rest of the industry if we continued indefinitely to exclude it from the levy.
The noble Viscount went on to point out that, although Cinerama could pay the levy, it could never benefit from it because the Cinerama type of film could never be made in this country. That is a question which I do not think the Board of Trade are capable of judging. My noble friend gave a number of technical reasons why he said it would always be impossible, and I think that, for the time being at any rate, we must accept a statement of that kind which comes from people who know so much more about it that we do. While I do not see why it should be ruled out for all time that, in different circumstances, films of this kind would be able to rank as a British film, we must accept, on the strength of the statements which have been made, that in present circumstances that could not happen. But that does not mean that Cinerama is in any worse position than any other American or foreign film which does not qualify as a British production. The exhibitors who show foreign films have to pay the levy, but the films, not being a British production, do not qualify for any part of the distribution of the levy. We do not think it would be fair that Cinerama should be placed in a special, privileged position for an indefinite length of time on the ground that it is a different type of entertainment.
There is one respect in which there is no doubt at all that Cinerama is not different from the rest of the cinema industry, and that is in its liability until yesterday to pay entertainments tax. In
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the Budget, Cinerama, together with other films, has now been relieved of entertainments duty. It is estimated that the amount of duty on which Cinerama exhibitors will be relieved as a result of the Budget will be double what they are likely to have to pay in levy. Therefore I hope they will console themselves by what is, on balance, a substantial gain.
3.16 p.m.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, we have listened to two very competent speeches. I should not like these Regulations to pass without saying that I appreciated the case submitted by the noble Viscount who rose to oppose them. It seemed to me, at first sight, to be almost unthinkable that the general duty to be levied in this industry should apply to such a singular case as he put on behalf of Cinerama. On the other hand, the noble Earl who has just replied seems also to have made a study of the matter and has put a fairly competent answer. Therefore, I think I should be moved in the matter if I could have a little more information about the amount of the duty, and also about the date when Cinerama, as such, would become chargeable. It seems to me that the future of Cinerama is one that we ought to try to promote in this country. At present, judging from the noble Viscount's case, the prospects do not seem to be very great without a large capital expenditure. But if we could have information on those two points, then I think there might be some case for setting off the benefit not yet to be achieved until next August, I think it is, in the case of cinema duty.
THE EARL OF DUNDEE: It is when the Finance Bill is passed. I think it is retrospective.
VISCOUNT ALEXANDER OF HILLSBOROUGH: That is some months ahead. I should be interested to know the date when this duty will apply to Cinerama, and what will be the amount actually levied upon it.
THE EARL OF DUNDEE: My Lords, with regard to the amount, it is estimated that the total amount of levy on all nonstandard films which are affected by these Regulations will be £250,000 on which far the greater part will come mainly from what are called Todd-AO films of 70 millimetres, which are twice

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the standard width of 35 millimetres. The proportion payable by Cinerama is estimated, I believe, by the Cinerama exhibitors themselves at about £60,000. The Board of Trade estimate is lower than that—it is about £40,000. But, of course, these are both estimates. Anyhow, it is a fairly small proportion of the total of £250,000 which is considered likely to have to be paid by the nonstandard films.
VISCOUNT ALEXANDER OF HILLSBOROUGH: Is that not nearly 20 per cent. of the total?
THE EARL OF DUNDEE: Yes, my Lords, that is so. The date at which the new levy begins is April 17. With regard to the remission of entertainments duty, although it does not become legal until the Finance Bill is passed, I think the duty is abolished with effect from April 10, so in effect it is abolished at the same time as the levy begins. There will have to be new Regulations, because under these Regulations, which could not anticipate the abolition of duty, there are certain respects in which the levy may be related to the amount of duty, and, as the Chancellor said in his Budget speech yesterday, it has made necessary the introduction of new consolidating Regulations after the Finance Bill has been passed. But that will not make any difference to the amount of levy payable, or to the benefit which is earned by the remission of entertainments duty.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, I am in a little difficulty, in that I have not my usual cinematograph experts behind me this afternoon for immediate consultation, but I understand that, on the Government's estimate, Cinerama is to be charged £40,000, that the estimate of the Cinerama industry is £60,000, and that the total of the levy to be raised over the whole industry is £250,000.
THE EARL OF DUNDEE: Not over the whole industry. The amount last year was £3¾ million. I thought that what the noble Viscount wanted to know was the additional amount of levy resulting from the inclusion of these non-standard films in the 1957 Regulations. I did say that it was a comparatively small item—only £250,000 altogether out of a total of nearly £4 million, and out of that it
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is estimated that Cinerama may be liable for something between £40,000 and £60,000.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, the noble Viscount has put up a powerful case, although I am not persuaded completely in my mind that I should vote for him in the Division Lobby. I wonder whether the matter could be delayed just a few days until we could find time to think out the answers given by the noble Earl.
THE EARL OF DUNDEE: I am sorry, but the Regulations cannot be amended. If we wanted to give effect to the noble Viscount's suggestion they would have to be withdrawn and new Regulations would have to be submitted; they are not capable of being amended in Parliament. These Regulations have been fully and carefully considered by the Cinematograph Films Council, together with the Board of Trade; and whilst I appreciate the force of the arguments which my noble friend Lord Brentford has put forward, I also feel that the case for doing this, in fairness to the cinema industry as a whole, is established, and that it would not be right for me, much as I should like to meet the noble Viscount the Leader of the Opposition, to agree to any postponement of these Regulations.
VISCOUNT BRENTFORD: My Lords, perhaps, with your Lordships' permission, I may briefly thank your Lordships very much for the interest you have taken in my argument, which is a difficult one to press, because I recognise that the owners and distributors of Cinerama are an American organisation and it is therefore not unnatural that the British representatives of the film industry in this country would desire that the contribution to the levy for British films should be payable by the American companies. If I may just confirm the reply which was given to the noble Viscount opposite, the levy is anticipated to produce about £60,000 a year from Cinerama in this country. The argument which the noble Earl put forward, that we should benefit as a result of the reduction in the entertainments tax, is I think, a double-edged one, because I know it had been hoped that if and when that occasion arose Cinerama would be able to reduce the price of its seats to the public, whereas now at least half

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of that benefit is simply a diversion of the public's funds to the film industry. On the other point, as to the proportion, it is true that only about one-quarter of the additional levy which is being raised will come from Cinerama, but the point is that the levy will be raised on some twenty or more additional cinemas, of which Cinerama has only one theatre.
On Question, Motion agreed to.

THE BISHOP OF JOHANNESBURG
3.23 p.m.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, may I repeat the Private Notice Question postponed earlier this afternoon, to ask Her Majesty's Government whether they will make a statement on the position of the Bishop of Johannesburg?
THE LORD PRESIDENT OF THE COUNCIL AND SECRETARY OF STATE FOR COMMONWEALTH RELATIONS (THE EARL OF HOME): My Lords, I apologise to the noble Viscount; I am very grateful to him for allowing me to fulfil a public engagement which I had at lunch time.
The High Commissioner has reported that the Anglican Bishop of Johannesburg has arrived in Swaziland for a short stay before leaving for England later in the month. I have seen Press reports that the Bishop has asked the High Commissioner to find out from the Union Government whether they intend to detain him under the Union Emergency Regulations. If this Press report is correct, the request must have been made subsequently to the High Commissioner's report of the Bishop's arrival in Swaziland. I am making further inquiries of the High Commissioner. If the Bishop wishes to stay in Swaziland for longer than a month it will be open to him to do so, if he complies with the immigration law. He is not being required by the Swaziland Government to return to the Union.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, I am very much obliged to the noble Earl for his reply. I hope that it may be possible, as a result of the inquiries he is making of the High Commissioner, for us to have a further statement in a very short
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period. Those of us who are concerned about these particular matters in South Africa are very concerned that the great leader of a diocese should not in any way be interfered with in the conduct of his duties, which must include concern for the whole of the members of his Church and their families committed to his charge; and we are therefore very anxious that Her Majesty's Government may be quite certain in their attitude of protection of his rights in this matter. I have seen the report in The Times this morning, and I must say that I most heartily sympathise with the Bishop of Johannesburg in his statement of intentions.
THE EARL OF HOME: Of course, my Lords, we fully share the concern of the noble Viscount. The only news I have seen has been in the Press. I do not know what request the Bishop has made to the High Commissioner; nor do I know that there is any intention of the South African Government to take any action at all. I should like to clarify the situation before I say more.
VISCOUNT STANSGATE: My Lords, will Parliament be informed in due course of the arrest of any British subjects by the Union Government under the emergency powers?
THE EARL OF HOME: Almost at once; I am going to do it now.
LORD REA: My Lords, could the noble Earl inform us whether he is likely to make a further statement about the Bishop in the next few days? At the beginning of his statement he said the High Commissioner reported that the Bishop had arrived for a short stay. On the television and wireless the reports were that the Bishop had "turned up" in Swaziland, which had a rather sinister sound. Would the noble Earl be in a position to tell us what is behind it?
THE EARL OF HOME: My Lords, I do not know the difference between turning up and arriving for a short stay—there may be none. But, as I said, I should like to get more facts about this situation. So far as I know, the Bishop is free to go anywhere, either back to the Union, to this country or anywhere else. I do not know the latest facts.
VISCOUNT ALEXANDER OF HILLSBOROUGH: With regard to the noble

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Earl's previous reference to the Press report, he has no doubt seen the reported statement in the London Times, that the Bishop said he had asked the British High Commissioner to find out from the South. African Government whether they intended to detain him under the Emergency Regulations. If (as was said, I think in the Guardian) he had been advised by his church authorities out there to leave, evidently there was something in the report of the intention to arrest him which led the church authorities to do that. This makes us very anxious, because this is a British citizen and we are responsible for the safety of his rights in the matter.
THE EARL OF HOME: My Lords, I am very anxious. This is a very unusual situation and a very unusual request in a very unusual situation. I think I must get the High Commissioner's advice before I say any more to the House on this matter; but I certainly will, of course, as soon as I can.

SOUTH AFRICAN TROUBLES AND U.K. CITIZENS
THE EARL OF HOME: My Lords, there is one other matter in which the House has been interested and which the noble Viscount has just mentioned, and with your permission I will make a statement about the position of the United Kingdom citizens who may have been under arrest in the Union of South Africa in the last few days. This is the latest information I have.
The United Kingdom High Commissioner in South Africa has reported that he has been assured by the Union Prime Minister that as soon as any arrested person has been identified to the satisfaction of the Union Government as a citizen of the United Kingdom and Colonies or a British-protected person, the High Commissioner or his representative may have access to him.
The High Commissioner has so far been informed of the names of three United Kingdom citizens who have been arrested: Mr. Peter Wilkins, who has now been released; Miss Hannah Stanton and Dr. Elias Letele. The High Commissioner is arranging to send a representative to visit both Miss Stanton and Dr. Letele immediately.
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The High Commissioner has been further assured by the Union Prime Minister that persons against whom charges are brought will appear before the ordinary courts and may be legally represented. If they apply for bail this will be a matter for the courts to decide.

CINEMATOGRAPH FILMS (DISTRIBUTION OF LEVY) REGULATIONS, 1960
THE EARL OF DUNDEE: I beg to move these Regulations.
Moved, That the Draft Cinematograph Films (Distribution of Levy) Regulations, 1960, be approved.—(The Earl of Dundee.)
On Question, Motion agreed to.

GAS BILL
3.30 p.m.
Order of the Day for the Second Reading read.
LORD MILLS: My Lords, I beg to move that this Bill be now read a second time. The provisions of this Bill fall into two clauses, and I do not thinks that the House will wish me to deal at any length with Clause 2, which provides for the recovery by the Minister of Power of certain expenses which he incurs in connection with the testing of gas. This is an administrative provision of which the financial implications are fairly small and it corrects an inadvertent deficiency of the Gas Act, 1948. I will therefore address my remarks to the first clause, which provides for an increase in the borrowing powers of the Gas Council from £450 million to £500 million or to such greater sum, not exceeding £525 million, as the Minister may by Order specify.
I think that the fundamental question which your Lordships' House will expect me to answer can be briefly put in this way. The output of the gas industry has been approximately static over the last few years, and it might therefore be supposed that the normal depreciation revenues of the industry should be sufficient to sustain the present and expected level of production. Why therefore must Parliament be asked to approve more borrowings?
To answer this question I think that we must consider what I might call the

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strategic position of the gas industry in our fuel economy. It occupies a key position, but the industry has to meet severe and very vigorous competition, notably from the oil and electricity industries. Not only have the Gas Boards at least two adversaries, but they must also fight on two fronts, because at present and for a long time to come the industry will need to produce two fuels—gas and coke—as the production of coke and other solid smokeless fuels is likely to be a very important part of the business of Area Gas Boards for a period which will stretch far beyond the time covered by this Bill.
We have, I submit, an important national asset in the existing underground distribution system which carries gas to premises of all types in all areas of the country, except in purely rural or semi-rural districts. It is perhaps not generally appreciated that about 12 million households in this country use gas. It is not too much to say that coke and other carbonised fuels produced by Area Gas Boards are vital to our progress towards clean air, which is so important. Coke has been criticised as to its suitability for this purpose and I would not claim that in the past progress in coke preparation and marketing has always been as good as it should have been.
Your Lordships may remember that between the wars some of the most progressive gas undertakings paid a lot of attention to coke preparation and marketing and greatly enlarged their coke revenues by so doing. After the war, for a number of years, the general shortage of fuel made it possible for coke to be readily sold in spite of inconsistencies in quality. More recently, I am glad to say, there has been a return to competitive selling and a British Standard Specification for open fire coke has now been introduced. In addition, with considerable enterprise, some Area Boards have produced highly reactive cokes which have secured a very ready sale at prices which appear likely to offer an economic return.
Although there are substantial quantities of excellent solid smokeless fuel now also being produced by both the National Coal Board and private enterprise concerns, I must emphasise that the wide creation of smokeless zones cannot succeed unless coke is acceptable to householders
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who wish to retain the comfort of the open fire at a cost comparable to that to which they have been accustomed when burning coal. There is now ample evidence that when good quality coke is supplied and burnt in a suitable appliance, these conditions can be met.
Apart, however, from its importance to the very large body of gas and coke consumers, the industry is a large consumer of coal: it is second only to the electricity industry. In this respect the Area Gas Boards have also the responsibility of securing markets for the substantial volumes of gas which are produced at coke ovens associated with the steel industry. The carbonisation of coal by conventional methods produces coke as well as gas, and a number of Boards have already found that the disposal of coke sets a limit to the amount of coal which they can use for gas making by the carbonisation process. It is against this background that the introduction of two large plants using the Lurgi process of total gasification of coal is especially significant.
The Lurgi plants will produce no coke, and they will have the additional advantage of being able to use a wider range of coal than that required for carbonisation. These plants, therefore, represent an important milestone to the industry, but it should be recognised that the Lurgi process is not, and cannot be, a universal solution to making town gas economically from coal. To produce gas at a competitive price these plants must be large and situated close to abundant supplies of suitable coal. Capital cost is relatively high, and the plants must be operated at a high load factor. Thus the construction of Lurgi plants on or adjacent to coal measures will depend not only on the economics of each project but particularly on the extent to which markets for base load gas can be secured within the area served by the plant. In some territories the existing base load is entirely, or almost entirely, covered by supplies of gas from coke ovens.
It is quite possible that in the course of time we shall see something in the nature of a national grid, associated with large scale underground storage. This, however, is for the future. In the short term, and as a first step towards a national grid, there will be opportunities of transferring gas from one Board to

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another, to their mutual advantage. In mentioning the important Lurgi developments I should not like to give your Lordships the impression that all hopes of gasifying coal by new methods rest in that process. The Gas Council are pursuing important experiments aimed ultimately at the hydrogenation of coal. There are important possibilities here, but a great deal of work remains to be done, and it is necessary first to develop the process first on an oil-feed stock before attempting in the final stage to hydrogenate coal.
Some natural concern was expressed during the debate in another place about the increased use of petroleum in its various forms for making town gas, and it has been assumed, rather prematurely, that such use is invariably at the expense of coal. This is not so. The production of gas to meet the heavy seasonal peak demand has for many years been assisted by the use of oil in the carburetted water gas process. Such plant can be brought into use and shut down very much more quickly than carbonising plant, and, indeed, the erection of carbonising plant to meet these comparatively short-duration loads would be entirely uneconomic. Most of the newer plants now being used for the catalytic gasification of oil are meeting these peak loads and are producing gas at a lower cost than could be secured by the older carburetted water gas process. At the same time, the use of oil refinery gases transmitted by pipe line from refineries to gas works and then reformed into town gas has provided several Boards with useful quantities of gas at low cost. These developments have undoubtedly helped the Gas Boards to restrain the cost of production and the reduction in coal usage which they have caused has been relatively slight.
Now, however, it is alleged that a much more serious threat to the coal interests arises with imported methane. I should like to put this matter into true perspective. First of all the experimental quantities so far imported by the small experimental ship, the "Methane Pioneer", are almost negligible, even compared with the total volume of gas sold by the North Thames Board, which is the only Board to have used this material so far. These have been experimental cargoes, and no proposals have yet been made to the Government for
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large-scale imports. It has been wrongly assumed that methane imports, if authorised, would be entirely at the expense of coal now being used for gas making. It is likely that if methane proves to be attractive it may also be a substitute for oil gas or an ideal enriching agent for lean coal gas. It may also help to retain markets for gas in areas remote from the coal fields which would otherwise be lost to the gas industry and thus to the coal industry. Cheap therms obtained from methane may enable Gas Boards to enlarge the market for gas and thus retain substantially unimpaired the outlet for gas produced by carbonising plants. I would suggest to your Lordships that until proposals are made for commercial imports, we should keep an open mind on the possible advantages and disadvantages which they might bring.
It has already been stated, and I am glad to have the opportunity of stating it again, that in taking account of any proposals which may be put to them the Government will take full account of the national interest in the broadest sense, including the interests of the coal industry. It is also, I think, worth pointing out that if, as seems possible, natural gas ultimately becomes an important commodity in international trade, then there may be strong arguments of broad economic interest for this country to have some share in it.
Last year, for the first time since nationalisation, the gas industry was in revenue deficit, and it may be asked what are the prospects of the industry successfully performing in the years ahead its important rôle in our fuel economy. Although gas has been used in this country since the beginning of the nineteenth century, it is still for many purposes the most suitable fuel available. Its inherent advantages must, in the present competitive state of the fuel market be buttressed by the production and distribution of a good and clean gas at competitive prices. At the same time, the improvement in coke production and marketing must continue to take advantage of the very important opportunity which the clean-air policy offers to the gas industry.
In industry, increasing quantities of town gas have been used since the war, and the present large consumption is

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expected to go on increasing continuously during the period covered by this Bill. In the domestic sector the position is more difficult, largely because gas has to compete against electricity. A great effort is being made to secure for gas certain domestic loads, such as space heating, for which it is a particularly attractive fuel, and I believe that these new loads can be won while the requirement for cooking purposes, which has provided the industry with its bread and butter for so many years, can be retained. The gas industry has no guaranteed customers. This expresses the difficulty of the task before the industry and the stimulus under which it works. The Boards will require to sustain a virile competition, virile competitive effort right through the period covered by this Bill, and the increase in authorised capital which this Bill represents should provide them with the tools to support this effort.
This, then, my Lords, in short, is the answer to the question which I posed at the beginning of my speech: that the higher limits which we are now asked to sanction will provide for the completion of the modernisation of the industry and for the inception of new developments, some of which I have very briefly indicated. The industry has been consistently modernising its efforts, reducing the number of gasworks, erecting better and modern gasworks, and giving a better service to the community. Your Lordships will be aware that the actual disbursements will, of course, be subject to the annual scrutiny which takes place on the capital development programmes of the Boards, and it is estimated that the initial limit of £500 million will be reached in about three years' time. There will thus be an opportunity for further reference to Parliament after a comparatively short period. I invite your Lordships' House to accept the need for this increase in the borrowing limits of the Gas Council and thus to signify your support of the efforts of this industry to make a worthy contribution to our fuel economy. I beg to move.
Moved, That the Bill be now read 2a.—(Lord Mills.)
3.54 p.m.
LORD DALTON: My Lords, in approaching this Bill, the Second Reading of which has been moved in such an
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interesting speech by the noble Lord, Lord Mills—such an interesting and such a technically informative and, on the whole, such a hopeful speech—we are confronting an interesting situation. I am tempted to say that this is, in the strict sense of the term, a Socialist measure, for the operative clause, Clause 1 of the Bill, proposes to facilitate the financing of a large and rapid expansion in a nationalised service—namely, the gas industry. But it is interesting to observe, looking back upon the debates of yesteryear, that atlhough there was much discussion when this industry was first brought within the public sector in (I think it was) 1948, since that time the industry has upon the whole been so successfully and efficiently conducted that there is to-day no serious demand for its denationalisation, even among the most devoted and dedicated doctrinaire supporters of anti-Socialist dogma in the Conservative Party. For this increasing agreement on what is desirable in the national interest we must surely all congratulate ourselves.
The Minister of Power in a speech in another place, and again the noble Lord, Lord Mills, here to-day, have, in terms of much interest to those of us who follow these matters and to the general public, praised on the whole, in very handsome terms, the performance of this publicly-owned industry. Great technical advances have evidently already been made since vesting day. The technicalities are such that not many—certainly not I and perhaps not many other Members in your Lordships' House—can discuss them in the way of pronouncing judicial assessments of just how much has been done. But I read with great interest what the Minister of Power said in another place and I have followed what the noble Lord has said to-day, and it certainly seems that not only have technical advances been achieved in the recent past but many others are, as it were, within the zone of possibility of achievement in the coming years that will be covered by these financial provisions.
It is interesting to recall that in 9 of the 10 financial years that have elapsed since vesting day this industry has made a profit or, if you prefer, a surplus, and in only one of these has it incurred a deficit. I was very interested to read

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that in the plans for the near future two-thirds of the finance required is to be furnished by the industry itself from its own internal resources, and only one-third of the sums required will need to be borrowed. That, I think, is a considerable achievement in the virtue of self-finance and is much to be welcomed. I think we may also say that the labour relations in this industry are, and have steadily been, excellent and that no friction has arisen through industrial disputes or difficulties in that field. We were also glad to hear—the noble Lord, Lord Mills, has repeated it to-day and the Minister of Power initially stated it in his speech in another place—that there are to be regular consultations between the chairman of the National Coal Board and the chairman of the Gas Council and other members, no doubt, of the National Coal Board and the Gas Authority, particularly when some new process is under consideration which might have adverse reactions in particular upon the coal industry, the representatives of which are naturally still sensitive in the light of past experience and eager to be assured that the legitimate interests of the coal industry are taken into account in any substantial new departures. I am sure we are all pleased to hear that.
I was rather surprised to notice that nothing was said in another place by any speaker in any section of the House about the price of gas; that was left unmentioned. I suppose it seems obvious, and no doubt it is borne out by statistics, that the prominent factor in the price of gas must be the price of coal. But I remember that in ancient days, before the nationalisation of the industry, we used to hear about the so-called "gasworks clause". If I recall correctly, what this provided was that if a privately-owned gas company desired to increase its dividends to its shareholders, this was permissible only if there was a corresponding reduction in the price of gas to the consumer—and the old Gas, Light & Coke Company, and others, worked on that basis for many years.
I should like to know what is happening now in this field of the price determination of gas. The pattern has changed. There are now no longer private gas companies, nor private shareholders, and, as I understand the
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matter, the effective accounting units are the Area Boards, each independent within its own field, which contribute towards the financial net surplus or deficit, as the case may be, on the working of the gas industry under its present constitution. But it would be interesting to hear something—and perhaps the noble Lord could say a word about it later on—as to the trend of gas prices in recent years, and also whether any hope can be held out that, with these various new inventions and technical developments on which he has discoursed with such ease and such knowledge, there will be any effect in the direction of enabling the gas consumer to participate in the technical progress of the industry through lower prices.
However this may be, I am sure that your Lordships' House will not desire to resist the passage of this Bill into law. I think we shall all judge it to be necessary and wisely conceived; and I believe that my noble friends on these Benches can sincerely welcome it as a constructive Socialist measure of which, both in principle and in practical detail, we wholly approve.
4.3 p.m.
LORD HAWKE: My Lords, I am not going to make a speech but only a few remarks prompted by my interest in this particular subject, by the speech of my noble friend who proposed the Bill and by the last accounts of the Gas Council. Gas is a very interesting commodity in that it is the method of piping coal into the home; and I understand that, through the bringing into force of new tariffs, gas is going to make a special effort to try to capture some of the space-heating and water-heating markets which it has never really had. So that, as gas is also the producer of coke, which is one of the three competitors for this market—the third being oil—the Gas Council must be in a very considerable dilemma as to which horse to back on which course: because, clearly, if they cheapen their gas and make their coke dearer, they are going to lose markets wherever there is not a gas main; and if the reverse holds true they will never be able to break into this particular market with gas.
At this stage I should say that I cannot understand how the present price of coke can be justified. It is at least

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five times the pre-war price; and, from the table in paragraph 463 of the last Annual Report, we see that, whereas sales of gas produced 66 per cent. more cash over the last ten-year period, coke receipts have gone up 80 per cent. I should not have thought that that was a justifiable burden on the coke consumer as against the gas consumer. But that does not help resolve that extremely difficult dilemma of what is the right tactical and strategical policy between gas and coke prices to gain this particular market in space-heating and water-heating.
Another interesting point that arises out of these accounts is the steady shrinkage in domestic consumers, the increase in industrial consumers, and the overall, slight increase in gas consumers. From that one would seriously wonder whether it pays to connect the vast majority of domestic consumers to a gas supply at all—consumers who possibly use it for cooking only, or for a gas fire, and who use other fuel for all other purposes. Now when we get two nationalised bodies, backed by the State with, I was going to say, unlimited capital behind them—that would not be correct, but, at any rate, it is easier for them to get capital from the State than it is on the private market—there is a temptation, I believe, for gas and electricity to indulge in uneconomic competition with each other. The noble Lords opposite tend to be very much against all competition: noble Lords on this side of the House tend to be the opposite. I suggest that often the golden mean may be correct, and that it may be uneconomic for gas and electricity both to go into the same housing estate where, from the facts and figures I have given, it would look as if the domestic load is not one which is particularly paying to gas.
My noble friend, in moving the Bill, gave a hint that he knew of coke of such quality that, when burnt in certain appliances, it would give the same effect as a coal fire. My Lords, I have seen these things in the Ideal Homes Exhibition for years, but never outside the Ideal Homes Exhibition; and I should very much like to have details of such a fuel and of such an appliance which burns steadily without going out, does not give anybody in the room a headache, and does not smell. My
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Lords, the gas industry is one of enormous interest for the future, because from it come so many raw materials, other than gas, which are so urgently required in the chemical industry.
4.9 p.m.
LORD GREENHILL: My Lords, before the noble Lord deals with the matters raised by my noble friend Lord Dalton, may I put forward a personal point of view? I speak as a small, domestic consumer of coke, and I am at the moment a little perturbed, for this reason. In anticipation of the area in which I live shortly becoming a smokeless zone, I have had installed one of these coke-burning stoves, and I am feeling that perhaps I have been a little deceived, partly as a result of the competitive advertising which appeared in the Press. There were illustrated certain coke-consuming appliances, and one in particular showed an artist's sketch of an open, coke-consuming fire or it may be solid fuel consuming fire, in which no bars were shown, and the picture was, as an artistic production, quite attractive. In actual practice what I find is this. First, there are several kinds of coke and smokeless fuel, none of which appears to have been either strongly recommended or even in ready demand; all of it appears to take up a considerable amount of space and to attract high contents of moisture, which not only makes it difficult to store but adds considerably to the cost. Then there is a third fault which has been brought to my notice—namely, that if the flue or chimney or whatever it is called does not work properly there is a danger of carbon monoxide coming into the room.
On the whole, one is given the feeling that this attractively advertised but dangerous piece of domestic furniture needs very careful handling. I wonder whether the noble Lord can give me, as a domestic consumer, some indication of what advantages there are; what prospects there are of coke being sold at a reasonable price; whether the coke is available, and, if so, which kind of coke he is prepared to recommend and when it may be available. These are thoughts that passed through my mind as I listened to the noble Lord's speech, and since I am only one of a considerably growing number of house occupiers in the country it may be of interest to

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others, too, to know what the Government's point of view is on this matter.
4.12 p.m.
LORD DOUGLAS OF BARLOCH: My Lords, I should like to support the point which my noble friend Lord Greenhill has made with regard to coke. The Minister has said that it is desirable to increase the production of coke in order to carry out the policy of the Clean Air Act; and no doubt it is. But I think that should be qualified by saying that it produces cleaner air, not clean air: it may be smokeless, but the fumes of the coke still go into the atmosphere and tend to settle at ground level. So it does not produce an entirely innocuous air but only one which is freer from smoke. It is well known, too, that coke which is sold to the consumer frequently contains a large amount of water—I am told that in some cases it may be as much as 30 per cent. or 40 per cent. of the weight—and the consumer has to pay for that as if it were fuel. That is entirely wrong and something ought to be done to put a stop to it. Other fuels are not subject to a disability of that kind, and if it is desired to encourage the consumption of coke, steps ought to be taken to see that it is of a uniform quality, and that it is free from moisture so that the consumer gets every time what he is paying for.
4.14 p.m.
LORD MILLS: My Lords, I am grateful to the noble Lord, Lord Dalton, for his helpful speech in relation to this industry and this Bill. He described it as a Socialist measure. Well, I do not want to deprive the noble Lord of the satisfaction he derives from that, but I look upon it as a national measure, because this industry, which is now a unified industry, is doing a great national work. It is true that it has generally made a profit, or a surplus, whichever the noble Lord prefers. I think that it just shows how wrong was the remark made yesterday, that we should seek to denationalise a prosperous industry. Here is a prosperous industry, and there is no proposal to denationalise it. It has made great technical advances; in fact, it had to make great technical advances to survive.
I referred in my opening to the inherent quality of gas. It is true that a great number of our fellow countrymen, or perhaps, even more so, fellow
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countrywomen, prefer gas for domestic use and in industry, too, it has a considerable place. I would stress the importance, not of telling people what they must have but of trying to meet their wishes in this matter. Reference was made by the noble Lord, Lord Hawke, to the fact that it does not pay to connect the great majority of consumers. I do not think that is quite right. It may be thought to be a pity that electricity and gas should be used in the one house, but I think it is only natural that it should be. If people prefer gas for one purpose and electricity for another, why should they not have it? After all, as I pointed out, there are 12 million people who use gas in their homes, and that is a consideration to which I think we must have regard.
LORD HAWKE: If I may interrupt the noble Lord, I think he slightly misinterpreted what I said. What I intended to ask was: does it pay to connect all the small domestic consumers? It would be entirely wrong to use the taxpayer's capital in order to subsidise those consumers, which would be the effect if it does not pay to connect them.
LORD MILLS: I think the short answer to that point is that it has hitherto paid, and the steps which the gas industry are taking to keep down the price of gas can be carried out only provided they have a sufficient number of customers. I think it is undoubted that large numbers of people do prefer gas for certain purposes, just as they prefer electricity for other purposes.
I am glad that the noble Lord, Lord Dalton, referred to the question of labour relations in this industry. They have been excellent, due to the wisdom on the part of the trade union leaders and of the gas industry leaders. I hope, in spite of what we read, that that condition will continue, because without harmony in industry we cannot get success in industry. The noble Lord also referred to the value of consultation, and I am glad, as I know my right honourable friend the Minister of Power is, that there is the opportunity and the desire for consultation. Before any steps are taken which might affect one industry as against the other, the Ministry of Power arranges for consultation on such matters. The noble Lord also referred to the price of gas and said,

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quite rightly, that in large measure it is related to the price of coal. That is something the gas industry have had to contend with, and it has been the spur for many of the new arrangements they have brought in to cheapen the price of gas.
This question of prices and tariffs is a very important one. I think it must be obvious that the first duty of the Gas Boards, and of the Gas Council who look at their tariffs—which is a good thing, too—must be to see that the industry does not become a burden on the State. Therefore they have so to arrange their tariffs that they can sell the maximum volume of gas and coke and remain competitive, and I think the gas industry has done a good job in this respect. It is true that it has been up against the mounting price of coal. That has enabled conditions in the mines to be better, but it has also affected the gas industry. What the gas industry itself has done in order to overcome these handicaps, I am sure reflects great credit on it. It has got rid of, or is getting rid of, large numbers of old gas works and putting in modern plants and modern distribution throughout. I am glad to be in a position to say that.
The noble Lord, Lord Hawke, referred to the question of space heating and water heating, and then went on to talk about the relation of the price of gas with the price of coke. They are very important matters, and I am glad the noble Lord drew attention to them. But they are a matter for the commercial judgment of the industry itself, and that is why it is always so important that whatever Government is in power will see that the management of those industries is first-class and qualified to exercise the best commercial judgment; because such matters require a very keen judgment, a very nice balance, of whether a little more should be charged for gas and a little less for coke, and vice versa.
LORD GREENHILL: What about the consumer interest?
LORD MILLS: My Lords, the consumer is taken care of, because any pro-
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posals for alterations of prices go to the consultative councils, who represent the consumer. I can assure your Lordships, from my own knowledge of this industry, that the question of the consumer is never away from the minds of the management of the Gas Boards. After all, they have to live on the consumer, and unless they satisfy the consumer they will not succeed.
I am glad that the noble Lord, Lord Greenhill, interjected that remark, because it brings me to his own individual complaint. I think it would be doing a great service if he would write to the Gas Council (or I should be happy to see that any letter is forwarded to the right quarter) because so much has been done to improve conditions. I informed your Lordships that there was now a British Standards specification for coke, and that is the coke which it is sought to supply to these smokeless zones. Perhaps I could refer to what the noble Lord, Lord Douglas of Barloch, had to say about pure air. I am sure he would admit that in a smokeless zone the position is very much better than in a comparative zone which is not smokeless. Efforts are constantly being directed to supplying the best fuel, and coke sold under these standard conditions is a very desirable fuel, and I am sure the industry will go on improving it. I should not like to pretend that the creation of smokeless zones can go forward at the pace we should like unless coke is there to its aid. But I hope that conditions are not so bad as the noble Lord apparently has experienced, because coke is sold under standard conditions which I laid down under a standard specification.
My Lords, I hope that I have dealt fully with the points that have been made. I should again like to thank the noble Lord, Lord Dalton, for what I am sure the gas industry would consider an encouraging contribution on his part. He referred to the amount of self-finance by the gas industry. This Bill asks for an increase in the authorised amount, and I hope that your Lordships will give it your blessing and pass it.
On Question, Bill read 2a: Committee negatived.

LEGAL AID BILL
4.28 p.m.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR: My Lords, in rising to move the Second Reading of this Bill, I fear that I shall inevitably detain your Lordships for some little time. I am, as Lord Chancellor, responsible to Parliament for the Legal Aid and Advice Act, 1949, which this Bill proposes to amend, and which, with the equivalent Act for Scotland, is the understructure for the whole of our provisions for ensuring that justice is obtainable by the less well-off members of our community, and that access to the courts is open to all. Your Lordships will forgive me for observing that this is a matter with which I am deeply and seriously concerned.
The object of this Bill is to put the Legal Aid Scheme, again broadly speaking, into the shape envisaged by its sponsors, a Committee under the chairmanship of the noble Lord, Lord Rushcliffe, whose wise counsels so many of us remember both here and in another place. That Committee reported in 1945. They devised a comprehensive scheme for legal aid which was adopted almost completely by the Government and which took shape in 1949 in the Legal Aid and Advice Act and the Legal Aid (Scotland) Act. Unfortunately before the Acts were in operation economic circumstances compelled a limitation in adoption to only those parts of it which were related to legal aid in the Supreme Court in England and in the Court of Sessions and Sheriff's Court in Scotland, and those alone were put into immediate operation.
Without criticising that decision in any way, it is true to say that it has bedevilled planning ever since. On the one hand, as part and parcel of the financial climate, the cost of living rose, nullifying to a large extent the objects of the Act. On the other hand, important parts of it had never come into play at all. Whenever money was available the difficult choice has faced the Government, whether to restore to those parts of the Act already in force the financial conditions enjoyed when the Act was passed, or whether to extend the Act to those parts which had so far benefited nobody. Gradually, we have
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been able to extend the Act almost, though not entirely, to the whole scheme envisaged by the Rushcliffe Committee and by Parliament. It is now the Government's intention to restore the financial provisions of the Act to their original scope.
Before dealing in detail with the objects of the Bill, I should perhaps explain the Legal Aid and Advice Schemes, what they are and how they work. It will be remembered that the Legal Aid Schemes are contributory, and contributory in more than one sense. There is the contribution which the State makes to the Legal Aid Fund; secondly, there are the contributions which the assisted litigants themselves make towards the total costs of their cases, with the exception of those litigants who are of really modest means; and thirdly there are the contributions which the lawyers also make, for under the Schemes they forgo a certain percentage of the costs which would normally be payable in respect of their services. Legal aid will now be provided in proceedings in most cases. I do not think I need enumerate them all to your Lordships.
Last year the Secretary of State for Scotland and I were able to bring into force Section 7 of the Act to provide for oral advice for poor people from solicitors in ordinary practice. This year we have been able to bring into force Section 5 of the Act which enables the poor to get the full services of a solicitor in writing letters, collecting evidence and the like in matters which might eventually lead to litigation but which have not as yet reached that stage. Your Lordships may regard these two most recent extensions of the Act as most important because it is only by explaining to a layman what his legal rights are, and, more often, what they are not, and, when necessary, writing letters on the matter on his behalf, that litigation can be prevented and difficulties removed without all the waste of time, money and emotions that legal actions cause.
These three schemes of oral advice, of legal aid in matters not involving litigation and legal aid in litigation, are administered by the English and Scottish Law Societies in consultation with the General Council of the Bar and the Faculty of Advocates respectively. I

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hope you will allow me to say, although I am head of the legal profession, that the country owes the lawyers a very considerable debt for their administration of these schemes. It is an immense undertaking, and thousands of barristers and solicitors are involved in it in one way or another. They grant legal aid, control legally-aided cases, manage the Advice Scheme and collect moneys due to the Legal Aid Fund. Over 20,000 cases are granted legal aid each year and over 80,000 live cases are on the books. The annual turnover is over £5,000,000 a year, of which less than half comes out of public funds. We are particularly indebted to the Law Societies for their efficient handling of this great Scheme. The one matter which the lawyers do not deal with themselves is the investigation of the resources of applicants for legal aid in litigious matters. That is done by the National Assistance Board.
The whole Scheme in England is subject to annual review by my Advisory Committee. This Committee is not composed of practising lawyers but represents the lay interest in the Legal Aid Scheme. The noble Lord, Lord Citrine, ought to approve of that, in view of the very admirable speech he made on a legal Bill the other day. The Reports of this Committee, first under the chairmanship of Sir George Aylwen, and latterly under the chairmanship of the noble Viscount, Lord Bridgeman, who unfortunately is unable to be in his place to-day, have been of inestimable value to myself and my predecessors. They have map read our course and have ensured that the public got value for its money, whether spent in contributions or spent in taxes. I am most grateful to the noble Viscount and the other members of his Committee for the interest they have taken in these matters and for the keen sense of responsibility with which they have watched over the fortunes of the Scheme.
In January, 1959, I requested them to consider the financial provisions of the Legal Aid and Advice Act and of the Legal Aid (Assessment of Resources) Regulations, the two instruments which define financial eligibility for legal aid and the financial terms upon which it will be offered. The Committee reported in June and their Report was presented to Parliament last December. Let me first explain how the financial
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provisions of the Act and the Regulations interlock. Although the Advisory Committee's task related only to England and Wales, their views bore, of course, equal relevance to Scotland, and the Bill relates to both countries. Both sets of Acts and Regulations are the same, so that in speaking of one I am speaking for both.
The Act provides financial limits below which legal aid is available, either free or on payment of a contribution. Those limits are described by references to what is called "disposable" income and "disposable" capital. Disposable income and disposable capital is income and capital after making certain deductions and allowances, and those deductions and allowances are prescribed in the Assessment of Resources Regulations. With reference to those Regulations, the Committee recommended changes with regard to both income and capital. Their first recommendation related to rent. Under the recommendations of the Rushcliffe Committee fifteen years ago, a legally-aided person received no rent allowance for the first 15s. a week of his rent. The Committee recommended that in future the full rent should be allowed. That recommendation was adopted last September, increasing the allowances of nearly all assisted persons by 15s. a week.
The allowance for children has always been the same as the allowance made under the National Assistance (Determination of Need) Regulations. They have therefore increased as and when the Determination of Need Regulations have been altered. The allowance for a spouse or an adult dependant is fixed in the Legal Aid Regulations. The Committee's second recommendation was that the allowance for a spouse shall equal the National Assistance allowance. I hope my noble and learned friend Lord Conesford does not share the disapproval of Mr. King in Stalky and Co. in regard to the use of the word "spouse", otherwise one has to use the words "husband" and "wife" each time. If he does, I apologise, because I shall continue to use the word "spouse". The immediate effect of this recommendation was to increase the allowances by a further 15s. a week in respect of married applicants. That recommendation was also carried out in amendments made to the Regulations last September.

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With regard to capital, there is now an allowance of £75 where an assisted person is married or has other dependants. There is no increase in the allowance, however many dependants (children, for example) he may have. The Advisory Committee recommended that in future there should be an allowance of £75 in respect of the first dependant, £50 in respect of a second and £25 for any other dependant. I propose to implement that recommendation as soon as this Bill passes.
I now come to compare three things: the financial provisions of the Act, the Advisory Committee's recommendations about them and the proposals in this Bill. Section 2 (1) of the Act provides that legal aid shall be available where disposable income is £420 a year or less. The Advisory Committee pointed out that the cost of living has increased by over 75 per cent. since the Rushcliffe Committee reported, and recommended increasing the figure of £420 to £750. This increase, of just over 78 per cent., would therefore restore the limit in real terms to that recommended by the Rushcliffe Committee. They pointed out, moreover, by reference to the Blue Book on Income and Expenditure, that this would make legal aid available, broadly speaking, to the same number of incomes as had been eligible in 1949 when the Legal Aid and Advice Acts were passed.
These were cogent reasons for accepting their figure. But the effect of their recommendation can really be studied only by seeing what the result of the recommendation would be after taking into account all the allowances made under the Assessment of Resources Regulations. I have already described the allowances for rent and for wives and children. Allowances are also made for income tax and rates, expenditure on house repairs, expenses incurred in travelling to employment, trade union subscriptions, superannuation payments, National Insurance contributions, any other insurances or reasonable hire purchase commitments, and, to use the words of the Act, other matters for which a person must or reasonably may provide. When these are taken into account, the effect of the Committee's proposals would be that legal aid would be available for a single person with an income of considerably over £1,250 a year and
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to a married person with children with an income of considerably over £1,500 a year.
The Government feel that gross limits of about those amounts fully protect those of small or moderate means who, under the Long Title to the Act, are to be catered for. People with incomes of above the figures I have just mentioned have resources—ipossibly their own houses and facilities generally—which enable them to raise cash to meet the demands of litigation. We have therefore come to the conclusion that an upper disposable limit of £700 a year and not £750 is about right for this purpose. That will enable people with between £1,250 a year, and £1,500 a year, depending upon whether they are single or married or the number of children they may have, to get legal aid. This is an increase of over 66 per cent. above the present figure which was approved by Parliament in 1949, and the cost of living has increased by only 52 per cent. since then. The latest Blue Book on National Income and Expenditure, which was not available to the Advisory Committee, shows eligibility for legal aid will still be greater than it was in 1949. Clause 1, subsection (1), of the Bill therefore seeks to amend Section 2 (1) of the Act by altering the figure of £420 disposable income to £700 disposable income.
I now turn to the upper capital limit. Under the proviso to that section of the Act, a person may be refused legal aid if, (1) he has disposable capital of more than £500, and (2), it appears that he can afford to proceed without legal aid. The Advisory Committee recommend no change in that provision and none appears in the Bill. In another place this recommendation came in for some criticism and I therefore asked the Advisory Committee to look at it again. They issued a report last February saying that on reconsideration they were still of the same opinion as they had been last June. It must be remembered that this is a purely discretionary provision. Legal aid can be refused under it only if it appears to those granting legal aid that there are sufficient resources available to the applicant to meet the costs of his contemplated litigation. The test is expanded in the Regulations. Under paragraph 8 of Regulation 5 of the Legal Aid (General) Regulations, 1960, the

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Committees are to refuse an application only if they think the maximum contribution which the assisted person will pay, if he gets legal aid, will meet the litigious costs in full. The Act requires a contribution of all the disposable capital less £75, and by a further provision in the Bill that £75 is to be increased to £125. Refusals of legal aid under the discretionary power can therefore occur only when there is a contribution of more than £375 out of capital, that is, £500 less £125, irrespective of any contribution which may be required from income.
My Lords, it is useless to offer legal aid, for example, in a county court proceeding, where the full costs are likely to be £50 or so, and to tell the grateful recipient that the maximum contribution he may have to pay to the Legal Aid Fund is going to be £375. He would really get no benefit from legal aid in those circumstances, for although the Act makes special provision in cases of assisted persons losing their action they could hardly come into play when the total cost was £50 and it was known that he might have been found capable of contributing over seven times that amount to the Legal Aid Fund. Similarly there is really no justification in giving a person legal aid for a maximum contribution of at least £375 when he wishes, say, to take divorce proceedings which are certain to be undefended. The costs in that case would probably be less than £100, and the only benefit he would then get would be at the expense of his lawyers, because in cases of that kind the lawyers forgo a percentage of their taxed costs. One asks, why should the lawyers make this sacrifice when the man is fully able to pay?
I have now dealt with the financial limits above which a person may be refused legal aid. Section 3 of the Act defines the financial limits below which a person will get that legal aid for nothing. The present income limit is a disposable income of £156 a year. The Advisory Committee recommend that that should be increased to a disposable income of £275 a year, an increase of about 76 per cent., thus putting the clock back, in real terms, to the time of the Rushcliffe Report. In addition to that argument they expressed the view that a single man or woman with five guineas a week after payment of his
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rent has nothing to spare for contributing towards his legal costs. Again I would ask your Lordships to examine this proposition in the light of the allowances which are made. I have already described the kind of allowances they are. All that is left for someone to pay for from his disposable income is food, clothing and footwear, fuel, light and power and replacements of household goods. If your Lordships are following me, you will remember the list I gave of items which come into deduction before disposable income is arrived at.
The effect of adopting the Advisory Committee's proposals, after deducting the allowances, would have been to allow a single person earning something over £10 per week to get legal aid for nothing. In the opinion of Her Majesty's Government £10 a week is about the limit at which free legal aid should be granted, and we therefore propose in Clause 1 (2) of the Bill a free income limit of £250—not the £275 recommended by the Committee. The effect of that is that a single person will have over £4 16s. a week for his ordinary living expenses—that is, for the items I have just mentioned—apart from those items for which special allowances are made: those in the list that I gave your Lordships earlier. It is an increase of 60 per cent. on the existing limit—8 per cent. more than the cost of living has increased since 1949.
The free income limit has another effect, because it is those with incomes above that figure who pay a contribution towards the costs of their cases. The Act provides that the contribution shall be one half of the excess over the free income limit. The Advisory Committee have recommended that the proportion should in future be one-third of the excess, and that recommendation has been adopted and also appears in Clause 1 (2) of the Bill. This is a most important provision. It is a great advance on the original Rushcliffe Scheme and I am delighted that we are now in a position to relax the rate of contribution in this way.
That completes the picture so far as income is concerned. This may be, therefore, a convenient moment to look at the effects. Taking actual cases which have been before the National Assistance Board, and adjusting them to meet the new circumstances, we get these results. First, a single person with no dependants

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who has a gross income of £520 a year (or £10 a week), paid a contribution of £64 before September, 1959. After the Assessment of Resources Regulations relating to income were amended last September, he would have contributed £44 10s. Under the proposals in the Bill he will pay no contribution at all.
Take a case which is very common in the Legal Aid Scheme—that of a separated wife, with two children, whose gross income is £750 a year and who has family allowances of £21. Before September, 1959, she would have paid £104 in contributions. At the present moment she would contribute £79 10s. 0d; and after the passage of the Bill she will contribute £21 10s. 0d. That is a very considerable advance. As my third case, I take a married couple, with three children, with an income of £1,000 a year and £47 derived from family allowances. Before September, 1959, they would have got no legal aid at all; neither would they get it at the present moment. But hereafter, after this Bill has become law, they will be eligible for legal aid at a contribution of £61 10s. 0d. Finally, those who just qualify for legal aid would pay a maximum contribution from income of £150.
I turn now to capital. As I have already explained, a contribution of all the disposable capital less £75 is required under Section 3 (1) of the Act. The Advisory Committee recommended increasing this free capital to £125, and that is provided by Clause 1 (2) (b). It will be appreciated that this relates to disposable capital, and, just as allowances are made from income, so allowances are made from capital to form the disposable capital. I have already referred to allowances for dependants and what I propose to do about them. In addition, certain types of capital assets are especially protected. The owner-occupied house is valued only at one-half of its value free from encumbrances above £2,000; and because house values have increased in the past years I am proposing to raise the £2,000 to £3,000.
Secondly, the contents of a house, save in exceptional circumstances, and articles of personal clothing and tools and equipment of trade, are ignored. The older of us have to stop and think what that means. To-day there are some 10
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million television sets, so that in two houses of three the contents to which I have referred would include a television set; and where the applicant uses his car for his business—for example, a commercial traveller—the car would also be included. Finally, the Board have a special discretion to adjust the allowances from capital in special circumstances. The most frequent circumstance is that of a person who is using capital to eke out a small income. Adjustments are made for that reason and, because the general financial provisions will now be more generous, the Board will be able to act with increased generosity in those circumstances. It has always been thought right to differentiate between the ways capital and income were treated under the scheme. As we all know, the tendency nowadays is to live up to one's income, and it is impossible to expect a litigant with a fairly modest income to alter his whole way of life so as to provide for all his costs out of his income. But capital, as the Rushcliffe Committee pointed out, as Parliament agreed in 1949, and as the Advisory Committee agreed last year, can and should be used for the emergencies of litigation.
My Lords, the Advisory Committee wisely recommended that the new limits should be capable of more rapid adjustments than they have been in the past. Subsection (3), read with the preceding subsections of Clause 1 of the Bill, accordingly provides that the limits can be increased (but not decreased) by Regulations, subject to the Affirmative Resolution procedure. This has always been a feature of National Assistance, and the effect may be seen from the fact that, while the legal aid rates have remained unchanged since 1949, the National Assistance rates have been increased under this procedure seven times since 1948.
Subsection (4) of Clause 1 makes transitional provisions to enable those whose incomes have been determined for the period in which the financial limits are changed to get proportionate benefit from them. Clause 2 gives power to reduce the lawyers' contribution to the Legal Aid Scheme. At present, following the recommendations of the Rushcliffe Committee, barristers and solicitors acting for legally aided people get 85 per cent. of their taxed costs in

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proceedings in the superior courts. It is right that I should point out—and I am sure that the noble Lord, Lord Milner of Leeds, will make this point clear—that that is taxed costs, the whole costs, and not profit costs, so the deduction is made from their total costs.
The Advisory Committee recommended that that 15 per cent. should be reduced to 10 per cent. But in England, at any rate, legal costs are in a transitional stage. Only recently have the Supreme Court Rule Committee increased very considerably the amount of litigious costs in the High Court and Court of Appeal, and without expert advice it is hard to see exactly how solicitors and barristers will be placed, taking into account, on the one hand the large increases they may have to meet in their overhead expenses and, on the other hand, the greater benefits they will receive under the new Rules of Court. In these circumstances I have invited the Chairman of the Bar Council and the President of the Law Society to investigate the position of the two professions and to let me have a report. I understand that the report from the Law Society, which is perhaps the more complex, will reach me very soon, and it will, of course, receive early and careful consideration. I think that the Bar Council and the Law Society fully agree with me that it is right that the lawyers should carry on with the centuries-old tradition of not charging full fees to those of small or moderate means. On the other hand, it is only right and proper that they should be fairly remunerated for the work.
Clause 3 applies only to Scotland. Their Scheme requires applications to be made in considerable detail, and solicitors inevitably are put to expense in satisfying the Scottish conditions, and that is provided for. The English Scheme does not require this provision because solicitors do not have to do the same amount of work as their Scottish brethren in preparing applications for legal aid, and where the client cannot afford to pay them himself they are entitled to be remunerated under Section 7 of the Act, as helping to complete an application for legal aid comes within the definition of oral advice. Finally, Clause 4 of the Bill resolves a minor accounting difficulty.
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My Lords, I have detained you for a long time over a small Bill, but the background is complex and that has taken me some time to explain. But, in the result, taking into account the more liberal allowances and the reduction in the amount of contribution, I am sure that your Lordships on both sides of the House will welcome this Bill as remedying the ills which the rising cost of living has led to and in alleviating the conditions of litigants of small and moderate means. I beg to move that the Bill be read a second time.
Moved, that the Bill be now read 2a.—(The Lord Chancellor.)
5.5 p.m.
LORD MILNER OF LEEDS: My Lords, the House is greatly indebted, I am sure we shall all agree, to the noble and learned Viscount on the Woolsack for the review he has given both of the contents of the Bill now before the House and of the history and attainments (if I may use the expression) of the Legal Aid Scheme. It was first brought into the law of the land by the Act of 1949, and was gradually extended by the various ways and in the various matters to which the noble and learned Viscount has made reference. I like to think of the Legal Aid Scheme as really implementing, if not wholly, at any rate to a large extent, the promise made by King John in Magna Charta: that justice should not be sold or denied or delayed to any man. I think that this Scheme, added to, as it has been, year by year, and now put on an even more favourable basis to applicants, goes a long way, though not the whole way, towards carrying out that very desirable end.
The Scheme also has in mind another general principle; that hardship should, wherever possible, be alleviated. Of course, that hardship may, in certain circumstances, be equally as great to a man or woman of quite considerable means, as to a man of very modest means. There was a case the other day—in fact there have been a number of cases lately—which took a considerable time, possibly a fortnight or three weeks. To a man with, if you like, £5,000 or £10,000 in capital, a case in the High Court, with leading counsel, might well use up the whole of his capital and cause him hardship equal to that caused to a man who had only

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£500 capital and was called upon to make a contribution of a large proportion of that sum in a case which he was bringing or defending. Therefore it may be that in the years to come we shall have to consider even greater increases in the limits of disposable income up to which relief or legal aid has to be given.
I recollect the introduction of this Scheme, in another place. It was introduced with a great deal of—shall I say?—timidity on the part of all concerned, because it was not at all clear how it would work out: whether there would be a great increase in litigation or whether it would be a flop; whether the various limits set were high enough or low enough. Gradually, however, it has become apparent that the scheme, even on its original basis, and still more so as it has developed, has in fact been a great success. If I may say so, I think that is due in very great part to the support and sympathetic attitude which has been taken by the noble and learned Viscount on the Woolsack and by his Department, and to the work of the Law Society. And, not least, it is due to the efforts of some 10,000 solicitors and barristers who have operated the Scheme at, as I think, a discount, if not, indeed, almost a cut price; because the proportion of 15 per cent., as the noble and learned Viscount has explained, is not 15 per cent. of profit costs, but 15 per cent. of the total taxed costs, and it takes no account of the costs which might be properly charged as between a solicitor and his own private client in an ordinary case. Therefore, the contribution made by lawyers in both branches of the profession is a very substantial one. My own view is that on the basis which has hitherto existed, many of these cases have been carried on by solicitors and barristers at a loss. I shall probably say a word or two about that later.
My Lords, the noble and learned Viscount on the Woolsack has told us how the Scheme was originally brought in, and how it then applied only to the High Court. Since then, it has been extended to the county courts; it has been extended to enable legal advice to be obtained under the Act—a very valuable extension—and I think I am right in saying that it has been, or is about to be, extended to magistrates' courts. Yet there are still other courts to which this Bill does not apply. One hopes that
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eventually the principles of the Legal Aid Scheme may be extended to litigation in the House of Lords; to proceedings before the Judicial Committee of the Privy Council; perhaps to coroners' courts, where frequently poor people require help to represent their points of view; and, it may be, to various tribunals, and even, perhaps, to arbitrations. I think that in one form or another the noble and learned Viscount on the Woolsack has power, subject to either Negative or Affirmative Resolutions, to make Regulations or in other ways to bring the various courts not at present within the purview of the Act within it; and to enable those who have business to do in those courts, and who are unable to bring their cases or applications without assistance, to do so.
My Lords, the noble and learned Viscount has explained that, in effect, there is a means test before one can obtain legal aid. He has explained that the disposable income limit up to which one can obtain that aid has hitherto been an income of £420 a year. That limit has now been raised—or will be raised when this Bill becomes an Act—to £700 a year. I think the noble and learned Viscount said that that was rather more than equivalent to the original £420. But it is curious that the Advisory Committee recommended the figure of £750, and that the Government have thought fit to cut this down to £700. The limit of £500 capital remains because, as I understand it, that is not, so to speak fixed: it is subject to discretion. In appropriate cases, where hardship would be caused to an individual having £500 worth of capital and who had to make an adequate contribution from that sum to the anticipated costs of litigation, there is a discretion to deal with the matter. In such a case the figure of £500 is not final. Then, again, the figure of income below which no contribution is required, in any circumstances, is increased by £250. Of course your Lordships will appreciate that these changes take account of the change in the value of money, and they extend the benefits of the Scheme to many who would not otherwise be able to have these advantages.
My Lords, I do not wish to be pernickety, but I think that, having regard to the great success of the Scheme and to the advantages it has conferred on

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many thousands of people, it is unfortunate that it was not carried further ere this. Even under the Bill before the House, the cost is estimated at little more than £2½ million a year—a comparatively small sum to confer this great benefit, year by year, on some 20,000 to 30,000 persons who would not otherwise be able to obtain the justice to which they think they are entitled. I think I am therefore justified in saying that it is unfortunate that the increases in this Bill have been delayed so long, though I admit that year by year the noble and learned Viscount on the Woolsack has extended the Scheme so as to cover the different courts and the question of advice. To that extent, the matter has therefore been under review, and improvements have been made since 1949.
I should like to revert just for a moment to the question of the 15 per cent. discount which, under the Scheme as it is at present, solicitors and barristers have to allow from their taxed costs. Here I ought perhaps to declare an interest in that matter. But I should like to press it upon the noble and learned Viscount on the Woolsack that, apart from the query as to why this particular profession should be singled out to do "cut-price" work, it is common knowledge that in the legal profession, as in every other profession, costs have gone up enormously: rents are up, and clerks, assistant solicitors and secretaries are all difficult to obtain at prices which many solicitors can afford to pay. Indeed, I think there are instances where people apply under the Legal Aid Scheme for the help of solicitors who in fact are not earning as much as the applicants. That applies particularly, of course, to country practices, where solicitors have some distance to go to the local district registry, to the assizes, or whatever it may be. In my view, there is no justification for asking lawyers in either branch of the profession to work for less than the normal costs. In any event, if the basis is taxed costs, they will be working at less than the costs which would be obtainable from one's own private clients, because there are many items of work done by solicitors (and by barristers) which are not admitted for the purpose of taxation but which are still incurred for the benefit of the litigant, if he be a litigant, and which enure to his benefit.
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I therefore hope, my Lords, that the noble and learned Viscount on the Woolsack will give some consideration to the question of doing away altogether with the 15 per cent. discount or allowance which lawyers at present are having to forgo in these legal aid cases.
There are two other points which occur to me. The first is that I sometimes think—and I believe others think with me—it rather unfair that where an assisted person brings a case to court against an unassisted person and the assisted person loses, the unassisted person (and, presumably he is the defendant in the majority of cases), who has won his case, should have to pay his own costs and should not have recourse to the Legal Aid Fund for reimbursement in whole or in part. This is commented on in the Ninth Report of the Law Society on Legal Aid, which says:
"During the year under review the attention of the Council"—
that is, the Council of the Law Society—
"has been drawn to the view expressed in Parliament and the Press that provision should be made whereby the opponent of an unsuccessful person could in proper cases have his costs paid out of the Legal Aid Fund. The Council consider these criticisms are well founded and in their view provision should be made accordingly."
One hopes that that may soon be brought about.
The other question which occurs to me has relation to Scotland. I do not profess to be an authority on Scottish law, but I gather that the practice in some directions is rather different there. I have sat at times on a certifying committee in England which has had to judge whether an applicant had a prima-facie case on which a certificate should be given for him to secure legal aid. As your Lordships will appreciate, in sitting on a committee having to give a decision on that question, one has statements before one of witnesses on the one side only, and no information as to whether there is any objection from the other side, or any particulars of the defendant's case, and a decision has to be come to on information supplied by the one side only, without hearing the other side. I understand that in Scotland the certifying committee asks the prospective defendant whether he or she has any objection to the giving of legal

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aid. That gives an opportunity to the unassisted person to put forward any case or any points which he or she has by way of objection.
One of the functions of trade unions is to take up cases on behalf of their members and to bear the expense. A member submits an application and the solicitors to the trade union consider the case and its possibilities and may advise that there is no case. There have been instances where, notwithstanding that expression of opinion and the eventual decision of the trade union not to support the case, the individual concerned has gone to the legal aid certifying committee and obtained leave, because, of course, the certifying committee had no knowledge that the trade union had already investigated the case and come to a decision against the applicant. It is a difficult matter, and some may think a reflection on trade unions, in one sense, if that sort of thing happens, but they do their best for their members and if they are of opinion that a member has no case, the certifying committee should have information and pay some regard to that fact. It is possible for there to be abuse of the Legal Aid Scheme in some instances, and it would appear that the practice in the Scottish courts, whereby the certifying committee asks the prospective defendant whether he or she has any objection to legal aid might be considered as being a useful practice to institute in the English courts. That, however, requires careful consideration.
I am afraid that I have detained your Lordships for some time. We on this side of the House wholeheartedly support the Bill. We think it will bring help and relief and, we hope, justice to a great many people who would otherwise not be in a position to take steps to obtain what they believe to be their rights. We hope that when the occasion arises the limit will be raised again when necessary; and this. I gather, will be possible without recourse to Parliament, because the noble and learned Viscount the Lord Chancellor and the Secretary of State for Scotland will have power under this Bill to make regulations. I hope that that will be done from time to time, if and when the necessity arises, and also that the scope of the Legal Aid Scheme may eventually he extended to those portions of our legal system to
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which at the moment it does not extend. We support the Second Reading of the Bill.
5.27 p.m.
LORD OGMORE: My Lords, I, too, should like to thank the noble and learned Viscount on the Woolsack for the full and detailed explanation he has given of the provisions of the Bill, and also for the illustrations which he had carefully prepared for us. After listening to the noble and learned Viscount I think that probably the new figures are about right. It is very much a question of judgment and opinion; one could take one basis for an increase, or another basis, but I should imagine that the basis proposed, which has been obviously carefully worked out by the noble and learned Viscount and his advisers, is about right.
As to the wider considerations other than those contained in Clause 1 of the Bill, I think we should all agree that this is a most remarkable scheme. It is a social service which is, to a large extent, in the early stages and mechanics of it, done voluntarily. The committees which consider whether there is a case for a certificate act voluntarily; it is run by a voluntary organisation, the Law Society, and also, to some extent, the Bar Council, in conjunction with the Lord Chancellor's Department and the courts. It is, I suppose, a remarkable instance of the British way of doing things in an empirical fashion. Here is a great social service which was started in quite a small way and is being built up largely on a voluntary basis.
In the early days of the system certain criticisms were levelled at it by those who had experience of it. The first, I think, was that not all the courts were covered. The noble and learned Viscount has brought more and more of those in, and now, by and large, except for one or two elevated ones whose decision the average litigant is not likely to want to seek, that loophole has been stopped up. Then there was what, to my mind, was a much more important criticism: namely, that the litigant did not come before the committee until things were pretty far gone and he wanted to go to court. There was no system of advice. I think it was a most important reform when the Lord Chancellor, I believe last year, brought in the new situation that the person who felt himself or herself aggrieved could seek

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legal advice. It has been my experience in thirty years or more of practice that time and time again if you can get at the person who is aggrieved early enough you can do a great deal without any recourse to litigation. I should think that for every case that appears before the court at least ten are settled out of court without even any pleadings being exchanged between the parties or a writ or summons being issued. That, to my mind, is of great value to the public, and particularly to those who desire to take advantage of the Legal Aid Scheme.
The third criticism was the one just mentioned by the noble Lord, Lord Milner of Leeds, which I was going to mention in any case, namely, what happens to the successful defendant—that is, where a person who takes advantage of legal aid goes to the court and is not successful. The successful defendant has been put to considerable expense, and as at present—I am subject to correction by the noble and learned Viscount—I believe he has no recourse against anyone unless he can get something out of the plaintiff. That is not very likely, or such a person would not have obtained legal aid in the first place. I confess that it is a very difficult, question to answer.
Of course, the offchance of that ought not to dissuade the Committee which is giving the legal aid certificate; if they think the plaintiff has a resonable chance, then they should give him a certificate. The fact that he might lose owing to some point of law which they cannot be expected to decide, should not dissuade them from giving him a certificate. Yet a good deal of injustice, harm or damage may accrue to the successful defendant. Is it right to load the scheme up with his costs? That is really what one has to decide: whether the public should bear the costs which now the successful defendant has to bear.
I think the whole attitude towards litigation has completely changed, even from the day when I started in practice. When people go to litigation nowadays, if, they are plaintiffs they expect to win, and if they are defendants they do not expect, if they win, to bear any costs or charges whatsoever. That is quite different from the old days. I remember my grandfather telling me when I was a boy that he had had a case, and had
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won it. I said, "Did you get anything as a result?" He said, "Good gracious, no! I won the case." It did not seem to worry him at all that he had got nothing out of it. I am sure that in those days, particularly perhaps in Wales, where people are a little more litigious, when one won the case the fact that one got nothing out of it was regarded as a comparatively minor matter. The sporting outlook on litigation is not now present at all—not in England, at any rate.
One must have regard for the fact that this will become more and more a factor, and complaints will be made more and more by those who successfully defend a suit that they cannot get anything out of the plaintiff by way of costs which they have suffered in the action. I am glad I have not got to decide that problem. It is very difficult to decide how we are to put it right. At the present moment, at all events, the Lord Chancellor has dealt successfully with two of the main criticisms of the Scheme, and I have no doubt that, in the course of time, if he has the time on the Woolsack to deal with it, he will be able to deal with the third.
5.33 p.m.
LORD SPENS: My Lords, may I raise one short point? I should like to add my word of thanks to the noble and learned Viscount on the Woolsack for all that he has done in this Scheme. But as one who has come recently from another place representing constituents, I may mention that I had three cases of exactly the same kind last year. They were all cases where the plaintiffs had obtained certificates that they were entitled to legal aid. They were told that they had a good case, and that they could go ahead. According to their own stories, no one had warned them that they were liable to make a contribution towards the costs. I do not know what the regulations are. I should have imagined that a plaintiff, after getting a certificate, should have signed something saying that he knew that in any circumstances he might have to make a contribution. If the regulations do not require some sort of signature from a plaintiff that he knows that he may have to make a contribution, then I would suggest to your Lordships that the new regulations should include something of that sort.

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One was accustomed to the complaints of those who were dissatisfied with having been turned down by the committees, but it was a new thing to me to have a complaint from educated people who had started their litigation without knowing that they had to make any contribution. One, at least, said that in no circumstances would she have started the litigation if she had thought she was liable to make any contribution out of her limited amount of capital. I hope that that matter will be attended to by the regulations, if it is not already there.
LORD CONESFORD: My Lords, I shall not delay the House for more than a moment. I rise only to welcome this Bill and to congratulate my noble and learned friend upon it. I should like also strongly to agree with what was said by the noble Lord, Lord Ogmore, on the great value of the extension which enables advice to be given, and not merely assistance with litigation.
5.37 p.m.
THE LORD CHANCELLOR: My Lords, I am grateful, first of all, collectively to all your Lordships for what you have said. If I may take the penultimate point first, that raised by my noble and learned friend Lord Spens, I am informed that there is a plain statement on the form of application that a contribution may be required. In view of what my noble and learned friend has said I will look into the point specifically and see whether we can give it any greater prominence, but, in fairness to those running the Scheme, I should like to tell him that it is on the form. I am sorry that his constituent should have missed it. I agree with what the noble Lords, Lord Ogmore and Lord Cones-ford, have said about the importance of the advice provisions. I have always shared their view, and I am glad that I shall be able to secure that those provisions shall come into operation.
The debate was opened after my speech by an interesting and informative speech from the noble Lord, Lord Milner of Leeds. It is tremendously important that everyone should recognise, as all your Lordships have recognised to-day, that (to put it in the slightly more cheerful terms in which it has often been put before) the statement that "the Courts of Justice, like the Ritz Hotel,
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are open to everyone" is something which we have definitely decided to end. We know, and will agree, how important a badge of civilisation good judges and good courts are, but unless we can see that people of middle and lower ranges of income can come to these courts, then they are not really fulfilling their purpose in the State. I am sure we are all in agreement upon that.
Everyone has had in mind the position of the successful unassisted defendant. The noble Lords, Lord Milner of Leeds and Lord Ogmore, mentioned it, and we have all had it in mind. Of course there comes a point, quite irrespective of our Party political views, which we must all consider; and that is what it is fair to put on to the general body of taxpayers and what chance the individual must take for himself in life. The chance of being sued unsuccessfully is one which, of course, has always been there, and one must remember that all the State is doing is to give the other person, whose case, after all, has been investigated by the original committee, the chance of bringing that case. I find it very difficult to accede to the view that that is necessarily a matter for the general body of taxpayers. None the less, I am greatly concerned about the problem.
I believe that there are certain things that I can do, because it has been suggested that the assisted litigant should go to the Court of Appeal only with leave of the court. But, just to show the difficulty of the problem, I have had the figures prepared for me. These show that the overall percentage of successful legally-aided appellants is over 44, whereas the overall percentage of successful appellants to the House of Lords, where leave has to be obtained, is only 32 per cent. That just shows the sort of difficulty that arises.
I think there are two important matters which are not sufficiently known. The unassisted person's opponent is entitled to refer the case to the area committee when he thinks that the assisted person has unreasonably refused a fair offer to settle the case, whether or not that offer was made without prejudice. I think that that should be made clear, and amendments to the Regulations with this effect will be put before me when the Regulations have to be amended to provide the financial limits for legal aid in matters

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not involving litigation. I believe that that will be a strengthening of the procedure by which representations can be made, and may prevent unmeritorious cases being continued. I shall do my best, and of course it is a matter for individual judges, with whose discretion I am very chary of interfering. However, I feel that I might be able to bring to their attention the great importance of exercising their powers so that assisted persons do, in fact, pay all their opponents' costs they reasonably can. Sometimes it has been said to me that they are rather inclined towards an assisted person and let the matter go. I will pursue both those lines, and I hope that they will have some effect; and, as I have said, I shall always consider the more general problem although it is one on which I have grave doubts.
The noble Lord, Lord Milner of Leeds, asked me to consider the question of doing away with the deduction. Of course, I will consider very carefully what he said, and I will consider the memorandum that I receive from the Law Society. I must say that, sentimentally, I should be rather sorry to see it go. For hundreds of years it has been a tradition of the profession to make some gesture. We all have memories of very long days in court, with practically no fees, in our early years, though we must not make our successors suffer the same thing just because we suffered it ourselves. At the same time, I believe there was a real satisfaction in making the contribution that we made. The whole question is one on which I have invited the Law Society to put their
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views before me, and I can assure the noble Lord they will be considered.
I addressed your Lordships for a long time in opening this debate, and I think that I have dealt with most of the points. I should only like to add my own contribution to the state of mind which the noble Lord, Lord Ogmore, described so charmingly. One of the most moving experiences of my life was appearing in a magistrates' court in North Wales. My client had two charges made against her: one was for assaulting the police and the other was for a breach of the local market regulations. I got her off the assault and she was convicted and fined 40s. for the breach of the market regulations. I went back with my solicitor and found her in floods of tears. I said, "I am very sorry", and she said, "Oh, it's not the fine, Mr. Maxwell Fyfe; it's you having lost the case after all you did." I thought it exactly exemplified what Lord Ogmore said, and I should like to close on that irrelevant but, to me, always charming note of the delights of litigation in the Principality of which I am so fond. I thank your Lordships very much for your reception of the Bill.
On Question, Bill read 2a; Committee negatived.

WAR DAMAGE (CLEARANCE PAYMENTS) BILL
5.48 p.m.
Read 3a (according to Order), and passed.
House adjourned at eleven minutes before six o'clock.