HL Deb 14 July 1967 vol 284 cc1373-98

12.22 p.m.

Order of the Day for the Second Reading read.


My Lords, I beg to move that the Bill be now read a second time. As your Lordships will have perceived, this is basically an enabling Bill. It is a short Bill, but it is certainly not an unimportant one. The Post Office Act 1961 sets out what amounts to a list of purposes on which money may be spent from the Post Office Fund. At the same time, it prevents the Postmaster General from making payments, other than those expressly provided for, from any sources other than the Post Office Fund. The list of purposes is quite wide enough for the Postmaster General to buy computers for the purposes of the Post Office, and to make available to any interested person any spare capacity there may happen incidentally to be when the Post Office has made all use that it needs of those computers. But the list of purposes is not wide enough for the Postmaster General to pay for resources needed specifically to give computer service to other people as a regular practice. The Postmaster General now, therefore, needs to add to the list of purposes in the 1961 Act a new item which will enable him to spend Post Office Fund money on the National Data Processing Service.

This Bill sets out to achieve two basic purposes. The first is to encourage a more widespread use of the computer by industry and commerce, and the second is to provide a framework within which the possibilities now being opened by technological advances in computers can be co-ordinated and exploited to the maximum advantage of the economy. On the first point, it is true that the use of computers in this country is behind that of some of our keenest commercial competitors. I make that statement with some hesitation, because simply to tot up computers even of similar capacity is not an absolutely certain indication, but none the less there is good evidence of this.

The second point refers to the possibilities which are now being opened up of having computer "talk" to computer, and of being able to maintain large stores of information permanently on the machine from which individual items may be retrieved in fractions of a second. This latter facility leads to the concept of "data bank" or "random access" systems. Some of these are at present in existence, and many more are being planned both in and out of Government service—private enterprise as well as in Government Departments—but their present characteristic is that their availability is relatively restricted. For instance, a file of design information may be available only to the customers of a particular bureau. What a public body can do is to create a truly national system by making it possible, under suitable financial arrangements, for computer users in any part of the system to have access to this information as required. There is more to this than setting up a number of independent computers and connecting lines. A measure of central co-ordination is required about the form and pattern of the messages which are exchanged.

The Government feel that in the interests of the economy they should do all they can to stimulate an increased and efficient use of computers. My right honourable friend the Minister of Technology has already taken steps with this intention. Noble Lords will be aware of the National Computing Centre and the contribution which we expect it to make to the solution of the problems of increasing the trained personnel available for this work and of programming. There have been other matters in the computer field which have been debated in your Lordships' House, for example computers for universities, the possible links, and so on. The National Data Processing Service will provide the means by which some of these solutions which I have mentioned may be applied on the ground.

The object of the N.D.P.S. is to bring more people into computing, not to keep them out and not to make a Government enclave. There is, therefore, no intention whatever, in theory or in practice, of making this a monopolistic service. It is intended to run the Service commercially and make a profit, because in a competitive situation this is an index of efficiency. But the Service will make its facilities available to all comers, even its commercial competitors. It will admit any privately-owned computer, or group of computers, to its facilities on the sole condition that the necessary technical requirements can be met. It will not withhold its equipment facilities from anyone who is prepared to rent them. This means that computer installations run as private bureaux, or self-contained groups of computers belonging to a commercial undertaking can, by arrangement, have access to facilities provided by other computers in the network which they might not otherwise be able to reach. This will apply both to the computer bureaux and also in individual groups of firms, whether banks or large organisations, such as that with which the noble Earl, Lord Courtown, is associated, and which has done a great deal of development in relation to I.C.I. in the computer field. They can operate on their own and, equally, they can have access to and make use of the National Service as it suits them and their judgment of their best interests. I feel that an early result of the creation of the N.D.P.S. will be an increase in the computer bureau business, where people who have special know-how in particular applications will set up in business using the equipment facilities of the N.D.P.S.

The reason the Government are entrusting the development of the N.D.P.S. to the Post Office is partly because of the Post Office's knowledge in the matter of communications; but, more basically, because the Post Office, which is already a very large bureau operator for its own business, will provide a very consideraable base load for the new business which will generate substantial economies of scale. It already has seven machines in use, and this number will almost treble in the next three years. Moreover, the Post Office's own requirements will compel it to weld these computers into a single integrated network. So I hope your Lordships will agree that this provides a very sound basis, and indeed a natural basis, for outward extension beyond the Post Office's own requirements.

The N.D.P.S. will be organised and operated as an independent service—and I stress this—within the main framework of what, if Parliament approves, will in the near future be the Post Office Corporation. It will be managed quite independently of other Post Office services; it will have its own force of programmers, systems analysts, other computer experts and technical, financial and marketing specialists. I think that this is also the point at which I should emphasise that it will have no responsibilities at all for the provision of lines or data transmission equipment, which will continue to be the responsibility of the equally separate and independently run Telecommunications Service, all within the responsibility of the Post Office or the Post Office Corporation.

The N.D.P.S. will therefore set out to provide a full range of data-processing services and facilities, but its early growth, particularly of its ability to provide consultancy and programming services, will be limited by what is a nationwide shortage of qualified staff. The Service proposes to recruit and train some 100 new people a year. As soon as the Bill becomes law, however, the Service will be in a position to provide data conversion and preparation facilities and computer-processing time for people who have, or can produce, their own programmes; and, as I have said, I expect this aspect to be of interest to operators, or would-be operators, of commercial bureaux. The availability of standard programmes from the National Computing Centre will also be an important factor in the growth rate of the N.D.P.S.

A question which I am sure is of interest to your Lordships, and indeed is of major importance, is that of the degree of confidentiality which will exist for private information which firms may entrust to the N.D.P.S. There are several aspects of this question. If a number of people have access by wire to a system which contains information from many sources, the first problem is to prevent unauthorised access by one user to information belonging to another—and this problem, of course, is not confined to computer information. This can be done by arranging for a dialogue, which can be as complicated as desired, to be conducted between the inquirer and the computer. The computer will ask questions and, if the inquirer cannot supply the right answers, he will be refused access to the information he is seeking. This can be further tightened by refusing access unless the questions are asked from previously specified points. It is worth adding that the information is stored in a computer in a highly concentrated and coded way, and if something went wrong and let the wrong inquirer through it is highly probable that he would receive nothing but an unintelligible stream of gibberish. It is quite a different proposition from being an unwilling eavesdropper to someone else's conversation.

There also remains the question of what has been called the "Big Brother" aspect. Considerable concern has been expressed that, because the N.D.P.S. will initially be part of a Government Department, and subsequently a public Corporation, the information confided to it about the financial affairs of individuals or companies might not be safe against some other Government Department. My right honourable friend the Postmaster General has recognised this concern, and Clause 2 of the Bill places an absolute embargo on the disclosure of such information except with the consent of the owner, or in response to a process of law. This embargo includes the Minister himself, and I hope your Lordships will feel that the confidentiality of information entrusted to the N.D.P.S. has been completely secured.

Perhaps I may make just one comment on this aspect. This is clearly going to be a major problem in an advancing technological society, and protection against misuse of information and improper action of Government will, in the long run, rest with Parliament in its control over the Executive. The degree of concern which has been expressed in Parliament, although at times there have been exaggerated anxieties, is none the less correct, because there are important issues here. I think that, so far as this proposal is concerned, we have taken all the steps necessary to ensure that there is not misuse, though I do not doubt that this issue will raise its head in many ways in the future, in relation to other forms of statistical and private collections of information.

I shall be very glad to deal further with this aspect if noble Lords wish to raise it, but I hope they will accept the view that the Government are just as much concerned as others that we should be eternally vigilant in regard to this matter, and I think the provision which has been put into the Bill will take care of the situation so far as this service is concerned. Indeed, it will be possible to change this only by Act of Parliament; and this is the protection.

May I just briefly deal with some of the financial aspects of the National Data Processing Service? These are important, and I shall try to make them clear. The first point is that the Service will have to stand on its own feet financially. It will not be subsidised in any circumstances, either by the Telecommunications Service or the Postal Service. It will not be a drain on either of them. That is perhaps a negative way of putting it. Like each of these Services, it will be required not only to earn income to cover the whole of its expense, but, further than that, to aim at a financial target which will be imposed on it. Furthermore, the financial performance of the Service will be clear for all to see.

Your Lordships are aware that the previous Government set financial targets for nationalised industries. The target set for the Post Office was an average of 8 per cent. return on capital over a five-year period which ends in March next year. The new targets are now being discussed with the Treasury. If, as suggested by the Select Committee of another place on Nationalised Industries, separate targets are set for the Postal and Telecommunications Services, it may well follow that there will be a separate target for the National Data Processing Service, since within the overall organisation of the Post Office the Service will be as financially separate as the other two already are.

The Post Office accounts, which are presented to Parliament annually, give very comprehensive information about the Postal Service on the one hand, and the Telecommunications Service on the other. If we proceed to establish the National Data Processing Service, the accounts will provide similar comprehensive information for that Service as well. My right honourable friend, the Postmaster General has made this very clear in another place, and I can see quite serious objections to making special provision in this Bill just to provide a separate account, when this must be accepted as the normal and proper practice for other Services also.

I have made these points in order, I hope, to assure your Lordships that the Post Office, already possessing commercial responsibilities which it will develop still further when it becomes a Corporation—this is the fundamental reason for the change in status—will run the new Service on sound financial lines from the outset. I see no alternative to a solution of the kind proposed here. I believe it is properly the responsibility of a national body, such as the Post Office, to do this. I believe it is not practical politics, and would not be acceptable for other reasons, to leave this to develop haphazardly. At the same time, I have made clear that we are well aware of the dangers to the development (which we want to foster) of the use of private computer activities, which there might be if it were conducted in an undesirable way, and of the dangers that there might be of a more fundamental kind.

My Lords, I hope that I have gone some way towards dealing with these problems. I have not gone through the Bill clause by clause—it is a very short Bill—but if any of your Lordships wish to ask any questions on any of the clauses I shall try to answer them when I reply. I therefore commend the Bill to your Lordships and beg to move that it be now read a second time.

Moved, That the Bill be now read 2a.—(Lord Shackleton.)

12.40 p.m.


My Lords, the House will be grateful to the noble Lord, Lord Shackleton, for having explained the purposes of this Bill, and for having introduced it in such a lucid and, if I may say so, such a fair manner, because he has acknowledged that there are problems, difficulties and hazards attendant upon this Bill becoming an Act. I am bound to say that I am grateful to him for having done this, because the Bill deals with a highly complicated subject. The more that one looks at the implications of the Bill, the more one realises the necessity almost of being a technocrat in order to appreciate its full importance. It is a peculiarly simple Bill. By the use of 13 words it completely alters the whole functions of the Post Office. Although it is a small Bill—despite the fact that it has been doubled in length in another place—let us be under no illusions whatsoever that it is a Bill of huge importance, the consequences of which will be noticed and felt for very many years from now.

The Post Office are indeed going through some substantial changes; and, curiously enough, succeed in doing this with the smallest and most modest-looking Bills that one could ever imagine, and with such very little "trumpet blowing". It was only four months ago that we passed the Post Office (Borrowing Powers) Bill, which attracted about four speakers and occupied your Lordships for about half an hour. I remember saying on that occasion that when 2s. is either added to or subtracted from the National Health charges, all hell is let loose; but when the Post Office are being provided with the facilities to borrow £880 million it goes through almost "on the nod". Indeed, it was only a short while ago that permission was obtained for the Post Office to go ahead with a new gyro system. It was only a few months ago that a Bill was passed allowing the Post Office Savings Bank to have the equivalent of a special investment department so that they could compete with trustee savings banks on a more equitable basis. It was again but a few months ago that the Postmaster General announced that the Post Office were going to become a public corporation, and no longer remain as an offshoot of the Government.

My Lords, these are all vast changes; and the Bill which the noble Lord has produced this morning is going to allow the Post Office to enter into the field of data processing in a very big way. There is no doubt whatever that computers have an enormous amount to offer business and commercial institutions and, indeed, Government. As a country, I believe that we lag behind others, as the noble Lord has said, in the use of computers, and anything that can be done to encourage their use should be given every assistance. But, of course, computers themselves are not a surety of success. They are expensive to buy and expensive to run, and the success of them depends to a very large extent upon their being utilised to their full capacity. One wonders whether at the moment all our computers are used to their full capacity. Indeed, one wonders whether the twenty large modern computers which I understand the Post Office are expecting to have in operation in 1971 will also be used to full capacity. I would doubt it in both cases. The provision of computers will not in itself assure their use; and if we lag behind other countries in their use, part of the problem will be to encourage business to make more use of the services which are available.


My Lords, may I interrupt the noble Earl? I should like to know what evidence he has on the under-use of computers. Clearly there is always a certain under-use, because general experience—and certainly it has been my experience in business in regard to computers—is that if they are properly used you always find your capacity inadequate to enable you to utilise them to the full. There may be cases of under-use, but these, I should have said, were matters of bad management or miscalculation. Certainly there has been some evidence, particularly in America, of people buying computers as status symbols; but I do not think it is a really serious matter. I should have liked to know what the noble Earl's evidence was on the general under-use of computers.


My Lords, this was an impression which I had. I may well be wrong, and if the noble Lord can confirm that indeed all these computers are used to their full capacity, then no one would be more pleased than I would. But, of course, the Bill allows the Post Office to provide a network of computers linked together for use throughout the country. I do not propose to go into the technical details which this possibility conjures up, because I for one am certainly not qualified to do so. One hears of co-axial cables and of the transmission of information at 3,000 million bits per second (whatever a "bit" may be; and one can only assume it is not very large) and one realises that one is in the realms of very sophisticated engineering. My knowledge of computers rests largely on the fact that they normally function with binary arithmetic. Everyone says that this is very simple, but I have always found it peculiarly difficult to comprehend, if only for the fact that it apparently uses only two figures, one of which is nought.


If I may interrupt the noble Earl again, if he "mugs up" a bit more on his binary arithmetic he will soon find out what a "bit" is.


I can only say to the noble Lord that he must have done his "mugging up" last night, because I know that yesterday he did not know what a "bit" was. What is more, if the noble Lord cares to "mug up" a little more about computers he will find, I think, that binary arithmetic is shortly going to be "old hat", and that they have now discovered a new language called P.L.I. I do not know at all what P.L.I. does or, indeed, what it stands for, but I can only assume that it falls somewhere between the two extremes of P.B.I., which is something military, and P.L.J., which is something liquid. Therefore, the comments I have to make this morning will be of a more general nature.

While we all welcome the use of computers, one cannot help but wonder whether in fact this is a correct extension of the duties of the Post Office. The job of the Post Office, fundamentally, is to furnish the country with efficient transmission facilities. If there is only a limited amount of funds available to the Post Office—and I will assume that this is so—I am doubtful myself whether it is prudent for the Post Office to embark on a new system of providing data processing units, which presumably means that this must militate against the provision of funds for work done on transmission facilities. It is absolutely vital that in the era into which we are moving—and so rapidly moving—the Post Office should be in the forefront of research into the different systems of transmission, and should be able to provide an absolutely first-class and up-to-date transmission service.

I believe it is the fact that even now two years' notice is required to provide lines for computer services; and I should have preferred to see the Post Office concentrate more on shortening this period and on making their work more perfect than on extending it into direct competition with private enterprise, in which field private enterprise has to date shown itself to be both efficient and farseeing—and indeed, I think, adequate. It was the original intention that the Post Office should be confined to letters, telephones, et cetera, and it was never anticipated that they should move into the wholly different field which this Bill will permit.

I, for one, feel there is much to be said against extending the activities of Government Departments into fields totally different from those for which they were originally intended. It was only a short while ago that we had the National Coal Board (Additional Powers) Bill which allowed the Coal Board to prospect for gas in the North Sea, an operation for which that Board was never intended. While I accept that it is essential to modernise and to move with the times, and that at times there should be a diversification of interests, I do not know that the practice of encouraging Government Departments or nationalised industries to enter into fields for which they are not intended and for which they are not necessarily suited is entirely commendable. I hope that the noble Lord will not think that I am making a petty Party point here, because that is far from my intention. It is merely an opinion which I hold and which I think bears examination.

A great point was made in another place—rightly so, I think; and the noble Lord mentioned it to-day—about the need for confidentiality. By providing exclusive facilities for data transmission and the machinery for data processing, the Post Office will be in a unique position. They are going to have in their hands a huge quantity of vital information which could be extremely valuable to competitors and—more sinisterly—they will have information which could be of extreme value to the Government in what might be a wholly honourable use. I know that Clause 2 has been inserted into the Bill to permit a large degree of confidentiality; and the noble Lord has said that one of the problems in this connection will be overcome by users having what is virtually a password without the correct use of which the computer will not divulge information. But I envisage the possibility of unauthorised people getting hold of passwords and, by tapping out the appropriate word, getting the machine to divulge a whole quantity of information.

One can see an example of this—I admit, in a very simple way—with a com- puter such as that installed for travellers' use by British European Airways. Once the computer is asked a single question, such as whether one is or is not booked on a particular aeroplane, it will divulge all the details it has in connection with the flight. It will tell the inquirer where he is going, where he is coming from, who else is travelling; and all sorts of information additional to the answer to the original question. I should not like it to be thought that I am suggesting that B.E.A. do not choose the kind of information divulged with the utmost care and discretion; I merely use it as an illustration of the possibility of extracting vast quantities of information—possibly secret and confidential information—from a computer by using the appropriate password.

My Lords, I can also envisage a situation in the future when a Government, getting more and more involved with long-term planning and needing all the relevant facts, will be tempted to say: "Here are all these data processing units which contain all the information we require—for example, how many bricks there are in the country, and what kind of cash is flowing in and out of the country—to plan efficiently for the benefit of the country as a whole. Would it not be possible for us to use this information, in an entirely confidential capacity, to enable us to plan for the future more effectively?" I know that Clause 2 has gone a great part of the way to ensure confidentiality; but I underline this point because to me it is very important.

The Post Office, too, will be in direct competition with private industry. While this may be beneficial in many ways, it is essential that the competition should be fair. I know that the Postmaster General in another place has said that the competition will be fair; I know that the noble Lord here said that it will be fair. But one can juggle around with figures to arrive at entirely different results—all of which are entirely defensible. For instance, the Post Office might consider it prudent to amortise their capital expenditure on the basis of the equipment being used to, say, 60 per cent. of capacity. It may be—I do not know—that such usage would be taken up by the Post Office and by other Government Departments. In that case, it could be that any usage above that percentage would attract no amortisation costs and would consequently be far cheaper. It could be that this is the computer-time to be made available for sale to the public.

What length of time is it anticipated will be allowed for the depreciation of these vastly expensive pieces of equipment? Is it five years, seven years, fifteen years? Probably one can provide good arguments for any of those periods of depreciation; but upon the period chosen will depend, very largely, the charges to be made. I know that this is a point of detail, but I make it to stress that it is not enough to say that there will not be unfair competition; for it could work out that, although this was the genuine intention, the practice might be wholly different. Any charges which are made must be in fair competition with the 100 or so private bureaux at the moment operating in the country.

My Lords, if I have appeared to be slightly unenthusiastic I hope the noble Lord will realise that it is merely because I have thought it prudent to highlight some of the dangers of the Bill. The Bill is peculiarly non-restricting and remarkably permissive. Because it is so permissive it seems to me reasonable to highlight the dangers. Having said that, I would add that I think it is an exciting venture and a progressive one. It will, I hope, help the country to keep in the van of modern techniques and modern technology. Computers are so sophisticated that now they even talk to each other. I think that is frightening in the magnitude of its conception. I could not help recalling the astonishment of one man who made use of a computer—not really a sophisticated computer, but a talking weighing machine on a railway platform. Having inserted 6d. he was told in a loud voice that he was 6 ft. 3 in. in height, that he was 12 stone in weight and was catching the 6.32 to Liverpool. He was so astonished that he felt that it must be a freak reaction; so he inserted another 6d. and was again told that he was 6 ft. 3 in., weighed 12 stone and was catching the 6.32 to Liverpool. He was so amazed that he called his wife to witness the wonders of modern technology. He inserted a further 6d., was told he was 6 ft. 3 in., weighed 12 stone and that, while he had been "mucking about like this" he had missed the 6.32 to Liverpool.

I cannot help feeling that such conversations will be slightly less exciting when carried out in binary arithemetic or P.L.I. But the use of computers can benefit the country and mankind alike; and I suppose it will not be long before we are able to dispense with all the complicated cable and grid systems about which we have been talking when some boffin considers it more prudent to put a computer into perpetual orbit, over our heads and the material will be fed into it, or bounced into it, by micro-waves. I confess that the idea of having one of these machines hurtling round the world above our heads does not fill me with great enthusiasm, although it makes the imagination work overtime. But it is a salutary thought that, in this world of vigorous, fascinating and sophisticated advance, where machines and computers appear to overtake the mind, when the noble Lord, Lord Shackleton, and I take part in this discussion our physical shortcomings are such—I hope they are temporary—that we both need the aid of a lump of wood.

1.0 p.m.


My Lords, I, too, am most grateful to my noble friend for the characteristic candour with which he introduced the Bill and acknowledged the problems to which it may give rise. I intervene in this debate, not because I can claim any specialised expertise in the recondite subject of computers but because, both as a citizen and as a lawyer, I am much concerned with two matters: first, the potential threat to individual privacy involved in setting up a computer data bank, and, secondly, the need for adequate safeguards. In this respect I am very glad that the Minister, speaking in another place, recognised that the point about need for what he called utter confidentiality (I prefer the word "confidence": I can never understand what the word "confidentiality" adds to our old-fashioned word "confidence") was an extremely valid and important one. I am happy that my noble friend has equally recognised that need.

The law relating to intrusions on privacy is a much-neglected subject in this country, unlike the United States; and it may well be that this accounts, to some extent at any rate, for the empty Benches when a Bill of this importance is introduced into your Lordships' House. An important conference took place recently under the auspices of the National Commission of Jurists on the whole subject of privacy, and I am very glad that our own Law Commission has been taking a close look at this subject. Modern technology, with its remarkable devices for electronic eavesdropping, involves tremendous threats to the whole idea of privacy. Though I do not, of course, question for a moment either the value of the present proposals or the good faith of those who will operate the scheme when it comes into operation, a computer data bank does provide a classic example of what is involved in this kind of problem. You are going to have vast mountains of information of a personal and confidential nature stored in a data bank.

My Lords, my aim is not to conjure up a melodramatic vision of an Orwellian world, dominated by "Big Brother", but, all the same, unless there are adequate safeguards, we could eventually arrive at some kind of surveillance system under which our associations, our finances and our physical and mental condition could all be stored up in some kind of computerised dossier crammed with facts; and not only facts, but evaluations. Some of the facts might be true and some might not be true, but there they would all be in this tremendous dossier. This could confer tremendous power over individuals, and it seems obvious, therefore, that what is needed is a legal structure to protect the individual, not only against misuse, as has already ben mentioned, but also against the storing of inaccurate, erroneous facts and evaluations about the individual. This matter is the subject of close examination at the present time in the United States.

It may not, perhaps, be known to all your Lordships that recently a Bill was introduced in the United States Senate to set up a National Data Computerised Centre. As a result of severe criticism from a number of quarters about the lack of adequate legal safeguards, that Bill was withdrawn and is being subjected to close scrutiny. I have in my hand a copy of the evidence submitted to the Judiciary Committee of the United States Senate by a leading expert in this field, Professor Miller, of the University of Michigan. In company with a number of other influential people, he made representations to the Senate Committee about the need for severe legal controls, and, as a result, as I have said, the Bill was withdrawn.

My Lords, what Professor Miller points out in this paper is that there will be a need for a highly sophisticated system of monitoring and control if we are to have proper safeguards. I am glad that my noble friend, Lord Shackle-ton, mentioned some, if not all, of these points. The things which need to be covered, and very closely covered, are such matters as ensuring the accuracy of the personal data which is stored in the computer bank. Then there is the question of limiting access to well-defined classes of persons. Perhaps even more important is the need to guard against unlawful or unwarranted intrusion by way of wire-tapping, electronic snooping, and so forth. All these matters raise considerable problems, and I am pleased that the Government have, at any rate, started to deal with them by introducing Clause 2 into the Bill; though it seems to me that this is only a beginning and that there is need to explore this whole problem in great detail and with great care. It is not enough simply to have a clause like the present Clause 2, imposing a duty of secrecy on Post Office officials in certain rather vaguely-defined circumstances. There is need to explore the whole problem.

I hope that my noble friend will forgive me if I say that I detected a faint note—only a faint note, and perhaps I misinterpreted his approach—of complacency in what he said, in so far as he seemed to suggest that Clause 2, as it stands, provides an adequate way to cope with the whole problem.


My Lords, may I interrupt my noble friend? I was hoping he was going to say that he detected a faint note of anxiety, which is what I really feel.


My Lords, I am grateful to my noble friend for his intervention. I detected a note of anxiety in certain stages of his speech, but when he came to deal with Clause 2 it seemed to me that he was going a little far in suggesting—probably I read too much into his words—that Clause 2 contains an answer to the whole problem.

I should like, in conclusion, to say that I realise that it will probably be some considerable time before this new Service is set up, and there should, therefore, be time enough for a detailed study to be given to this far-reaching problem. I hope that advantage will be taken of the knowledge and experience which has been, and is being, accumulated in the United States on this subject. It is fair to point out that the United States has been in the vanguard in respect of the protection by legal means of the right of privacy, and this is a matter about which we have something to learn from our American friends. I hope that the United States' experience will be considered. I am confident that all concerned with these problems would be only too anxious to proffer helpful advice. It is therefore in the entirely constructive hope that this Government, which is so much concerned with preserving individual freedom, will not rest content until fully adequate legal safeguards are worked out, that I ventured to intervene in this debate.

1.11 p.m.


My Lords, my interest has already been exposed by the noble Lord, Lord Shackleton. I have been concerned for many years with the installation and application of computers in a large industrial concern. We have recently linked computers together, one with each other, and also with some hundred other points, in works and shops throughout the country to form a communications grid, something of the sort which this Bill is aimed at, and which I expect the G.P.O. will develop in due course. There is much that I could say about this which I think is relevant to the Bill, but I shall confine myself to the question of telecommunications grids.

I welcome the speech of the noble Lord, Lord Shackleton, and I agree with everything that he said. I was particularly interested in the point he made that the new Data Processing Service should be kept entirely separate from the rest of the G.P.O. We in the computer industry regard ourselves as complementary to the new service which is going to be provided, and one of the things we are apprehensive about is the competition for the services provided by the other sides of the Post Office, for the telecommunications side. I should like to support what the noble Lord said about computers being fully occupied. I have no doubt that there are companies which have put in computers as status symbols, as the noble Lord implied, but I assure him that the computers with which I am concerned are fully occupied.

In developing our telecommunications grid, there have been many problems. For instance, it has taken us three years to develop our grid with an electronic switching system, from the time we started planning to the time when it went live a short time ago. We believe that such a grid is vital to the economic and efficient use of our computers. Many other large enterprises are planning similar networks apart from the G.P.O. In our case, it has involved capital expenditure on electronic switching equipment and ancillaries of about £500,000. The establishment of such a network is a big affair for any company, requiring a great expenditure of money and of highly skilled time.

Again, it has taken us over twelve months to get from the Post Office a licence to operate this network. In fact, we only obtained the licence within a few days of the network being ready to go into commission. Even now, the licence can be withdrawn at any time. We have no security of tenure.

Many lessons can be drawn from our experience, but I propose to limit my points to three. The first is that the G.P.O. should be encouraged to experiment, and to allow others to experiment, with advanced technologies in the field of telecommunications. As I said, the new data processing service will not be concerned with telecommunications. They will have to go cap-in-hand to another part of the Post Office to provide that. I believe that a great deal of advance can be made on the telecommunications side. Comparisons have been made between telecommunications in this country and on the other side of the Atlantic. There is great opportunity now for the G.P.O. to catch up. The present teleprinter, which is still the only one supplied by the Post Office, dates back to 1929. There are gaps between the G.P.O. standards and international standards in the improvement of new equipment, and this leads to additional costs. There is a great opportunity now for the G.P.O., in conjunction with other users, to give a new look to our telecommunications system.

The second point I want to make is related to flexibility of private circuits. The noble Earl, Lord Ferrers, said that it took up to two years to provide new circuits. I believe that the average time it takes is nine months; though we have known it to take up to 18 months. One of the difficulties in obtaining a licence for a private network is that the G.P.O., presumably jealous of its monopoly powers, is diffident about allowing a company to install a network in premises not owned by the company—for instance, in a distribution centre or at a railhead. There is also the question of stand-by circuits. In the past, we have had telecommunications networks which provided message-switching facilities, and if a particular circuit failed and went out of operation there were other ways of sending information. A network can be completely crippled by a bad line going out of operation, and once we have line computers, the question of stand-by circuits becomes most important. I hope that the Post Office will take a good look at the whole of their arrangements for giving priorities.

Finally, there is the question of charging and costing. The Government have already given an undertaking that the Service shall be run as a separate enterprise. We also want to make sure that the charges made for lines on the telecommunications side of the service provided by the Post Office are properly costed. Some years ago the cost of private teleprinter lines was increased at short notice by some 25 to 40 per cent., and there were indications then that the private lines were tending to subsidise the public telegraph service. The new data processing service and the telecommunication grids will be a vital part of industrial activity over the next few years, and it is most important that they should not be required to pay more than the proper economic cost of the lines they require.

I would end by saying that I support this Bill. I see in it the possibility of the G.P.O. getting experience at first hand of the problems of those who are developing large integral computer systems. The G.P.O. have a monopoly of telecommunications which can make or mar these systems. All those concerned will have to show a willingness to experiment and to encourage others to experiment, and will need to be vigilant in holding a fair balance between internal, G.P.O., demand and external demand.

1.20 p.m.


My Lords, your Lordships have received this Bill in a characteristically House of Lords' way, with a wide range of interest and a goodhearted mixture from the Opposition Front Bench, where the noble Earl, Lord Ferrers, went through certain old-fashioned notions in the beginning but ended up as a new-fashioned individual. Perhaps I can deal with part of his speech. The noble Earl rather implied that the Post Office ought to stick to letters, which is what it was originally established for, and ought not to have anything to do with these new-fangled telephones or telegraphs, which, after all, were a later development. Therefore I thought the first part of his speech reflected an anxiety which we feel we ought not to allow to be decisive. Any form of advance must involve some change, and probably risk. I will come on particularly to the question of confidentiality and these wider social issues towards the end.

I think that the noble Earl had not thought it out, or was thinking of it from the wrong end. He was saying: "Why give it to the Post Office? Why does not the Post Office stick to its particular cobbler's last?" The answer is that here is a new need. The fact that new responsibilities are put on the Post Office that were not originally envisaged does not seem to me to have much fundamental significance. What one has to find is the appropriate instrument to make use of the opportunities which modern invention has thrust upon us. The decision that the Post Office should do it was arrived at because the Post Office is the best placed of any national body to provide a national service. Therefore, I would counsel the noble Earl that he shows the courage about these risky undertakings which I know he personally possesses. I think we have to go forward and not hide away for fear of the consequences; and indeed, failure to take advantage could bring even more detrimental results than if we faced the issues squarely and tried to tackle the dangers.

There were some interesting points in the speech of the noble Earl—although having done a little more of my homework in binary arithmetic I shall be careful not to embark too far into this. He raised, for instance, the question of depreciation arrangements. Depreciation is a matter which many people will argue about, and it is very properly a concern for any industrial management. The length of time to depreciate a particular piece of equipment depends on any number of circumstances. It certainly will not depend upon its useful life.

There is some argument as to whether computers, especially some of the new ones, are not obsolescent in four years. If I recall aright, the normal arrangements by which computers are hired provide for amortisation in four years. But computers will in many cases go on much longer. Although at the present moment the Post Office computers are depreciated over a 10-year period, it may well be that these computers will go on longer than that.

This is a matter which must be determined by experience and by professional judgment. It will not be determined by what may be called political judgment. It is the matter of the right type of sophisticated arrangement, with which the Post Office is already equipped. At the present moment, annual provision is made on a straight line basis by the latest assessment by technical staff of the lives of the various types of plant and equipment and of the residual value, and provision on the basis of historical cost is supplemented by the estimated addition to bring the total provision for the year into line with the current value of the assets. It has been suggested that a 10-year period is too long. But the Post Office has already one magnetic tape computer which is nearing the end of a 10-year life, and this is still in effective and economical use. More experience is needed before we can be knowledgeable about the lives of com- puters. This is obviously something which will be kept under review, and it will be open to Parliament, to the Auditor General and others. There are controls in regard to this matter, and I do not doubt that if further concern is expressed in the future it will be brought out.


My Lords, may I interrupt the noble Lord? I do so only to point out that I was not expecting him to answer here and now by saying what would be the depreciated life of a computer. I was merely trying to make the point that, as he has recognised, there could be sound arguments for using a short term or a long term, and whichever decision is finally taken will have a material effect upon the cost.


My Lords, I hope there is no difference between us. I only detected a certain suspicion on the part of the noble Earl that in some way in this matter the accounts might not truly present the real position. Standards will exist in regard to this matter and it will be possible to make the necessary comparisons. I have dealt with the subject at some length because I think it is important, and where it is possible I think it is right to dispose of anxieties.

The real point I want to get across here is that the Post Office itself is interested in fair competition. As the noble Earl, Lord Courtown, made clear, it is really rather a good thing that the Post Office is going to become a consumer of the Telecommunications Service in this respect and will therefore be very much aware of the position. I would not accept that it is not aware of shortcomings and difficulties, although it is perhaps more aware of the obstacles that have always been placed in its way under general national policy, and tried to rectify those. The Post Office will themselves be a user, and they will be operating networks similar to those that the noble Earl's progressive firm operate.

I am very glad that the noble Earl is supporting this Bill, because, as your Lordships know, with his many years of management experience, no one is better qualified to assess the position. As I have said in this House before, I am one of those people from industry who have made free use of the brains that I.C.I. have in the noble Earl and his associates in giving advice on these matters. The fact that he has given a general pat on the back is most encouraging. He sees that there is a complementary side, and it is right that both Government and private enterprise should seek to harmonise their interests.

Some concern was expressed on the telecommunications side. I do not know whether to go into this matter at great length. Some of the difficulties of the Post Office on telecommunications were explained in the White Paper on Post Office prospects. There are certain shortages. I am told that, although there have been no requests for wide-band circuits exclusively for data transmission, there is a delay for the wide-band circuit of about 18 months to two years, whereas certain other circuits, carrying a rather slower rate of transmission, can be provided on demand, or with very little delay. But I should like to look at the noble Lord's points in more detail. I shall be glad to let him have comments on them, and if the comments I give him are not satisfactory we can pursue the matter further. I was concerned, for instance, about the delay in getting a licence. There are always good reasons for such delays, but it does not mean that they are not worrying and disturbing, and I should particularly like to see what the circumstances were.


My Lords, may I intervene on this question of delay to say that, in the main, so far as I know, licences have been obtained. But if you are going to plan these things a long way ahead you have to know whether or not you are going to get a licence, and it often takes a great deal of time to achieve.


My Lords, I take the noble Earl's point, and I think it would be worth while, as with any matter raised by one of your Lordships or a Member of another place, to look at the particular circumstances. I expect the noble Earl has already made representations on this, but, if not—indeed, in any case—I should like to look into the matter further and to pursue it. Naturally, at this stage I do not express any judgment. The Post Office seem to keep closely in touch with industry, and I am quite sure that in their new guise they will strengthen and enhance their customer relationship. Of course, one of the purposes of setting up this new organisation is to give the Post Office a more commercial approach, as well as providing a different kind of organisation. I think I have covered some of the major points.

I should like to turn back to what is perhaps the most crucial issue of all, and that is the question of confidentiality. Both the noble Earl, Lord Ferrers, and the noble Lord, Lord Lloyd of Hampstead, referred to this matter. I think perhaps the noble Lord, Lord Lloyd of Hampstead, was correct in saying that there was a certain mixture of complacency and anxiety on my part. There was complacency in the sense that, so far as this particular arrangement is concerned, I believe that the best steps that can be taken now have been taken and will be adequate. But the fact remains that a repressive Government will always be able to extract information which they require about the status of individuals and businesses. The real safeguard, as I mentioned before, must Lie on the Floor of Parliament, and with such institutions as we may create and as may be necessary in the future for the protection of the individual. This is a much wider question than simply this particular set of computer records, and I am quite sure that both the noble Lords who were pressing this issue were thinking in terms not only of this particular service but of the future.

As someone who has been reading science fiction for thirty years, I am very well aware of these problems, because this is a subject which has frequently been discussed in the pages of science fiction; and, like so much science fiction, it is likely to come to pass. I would say that there is no safeguard other than our own democratic system and the vigilance of individuals that will provide protection against a repressive Government. I do not doubt that the written records of a German business under the Nazis were fully open to the Government, it is a possibility already existing with written records.

I should not, least of all in the presence of an Under-Secretary of the Home Office, wish to discuss the records that may be kept by the police and other bodies, but the risk is already there; and the point which the noble Lord has raised is therefore a much more fundamental one. I think, therefore, that what is important in this case is that these alarms have been expressed. It would not be right for the Government just to brush them off with complacency. I want to acknowledge that there is this danger and that further thought has to be given to it.

Of course, we have already made a step in certain directions for the protection of the individual in setting up the Parliamentary Commissioner. I know that the noble Lord, Lord Lloyd of Hampstead, was not entirely happy and did not feel that that step went quite far enough. But it is a start, and it may be that we shall want to establish special institutions for this purpose. It is my general belief, as I said when speaking on the Bill connected with the Parliamentary Commissioner, that the rights of the individual, whatever limitations there may be, are more jealously and more vigorously protected in this country than perhaps in any other country in the world. But this is no reason for complacency.

In relation to this particular matter the risk perhaps does exist. I think myself—I am talking now about commercial risk—that it would be more difficult to burgle the information from a computer, particularly a multi-access data bank, but of course this is liable to happen to-day if the safe keys are not properly guarded. Or it will be possible for a corrupted employee to get at this information. I am merely saying that I think, so far as the commercial side is concerned, the information will be more secure, or at least certainly as secure as existing confidential information is. It is going to be more difficult to break and enter a computer, so to speak, than to gain access to ordinary records at the moment.

I hope I have commented on most of the points that have been made. I am grateful to noble Lords who have spoken in this debate, and very grateful for the general welcome that has been given to the Bill. We have clearly got to embark on these matters. We have clearly got to face the risk of change. Industry goes ahead—some parts of industry more effectively than others. But it would be quite wrong for the Government not to play their part. This is why the Government have introduced this Bill, and I am grateful that noble Lords—as they appear to be—are about to give it a Second Reading.

On Question, Bill read 2a, and committed to a Committee of the Whole House.