Lords Sitting of 21 June 1968

Preamble
The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Ripon.

PLANNING CONTROL OF RADIO MASTS
11.5 a.m.
LORD CHORLEY: My Lords. May I apologise to your Lordships for not being in my place when this Question was called on Tuesday. 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 whether they are satisfied that local planning authorities have adequate technical advice at their disposal to deal with planning applications for radio masts, and in particular whether the gas industry, proposals for telemetric control of pipelines by radio have been fully examined as a whole with a view to their using landlines instead.]
THE PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD KENNET): My Lords, a circular on planning control of radio masts of which a copy is available in the Library has just been sent to planning authorities. This points out that the onus is on an applicant to explain the technical case for any new mast and that if a planning authority is not satisfied it can seek the help of a consultant. A very full examination has been carried out of the gas industry's requirements for telemetric control of natural gas pipelines, and the Government are satisfied that the use of radio is essential.
LORD CHORLEY: My Lords, while thanking the Minister for that reply and realising that at any rate some parts of it will meet with the appreciation of amenity societies, I would ask the Minis-
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ter and your Lordships for time to consider it with the possibility of coming back to this Question.

CARAVAN SITES BILL
11.7 a.m.
LORD WADE: My Lords, I beg to move that this Bill be now read a second time. This is a small Bill, a Private Member's Bill, introduced in another place by Mr. Eric Lubbock with all-Party support, and it received an unopposed Third Reading. I said that it is a small Bill, but perhaps I should have said two small Bills, because there is a distinction to be made between Part I and Part II of the Bill. There is no direct connection between the protection of occupied caravans and the provision of sites by local authorities for persons of a nomadic way of life, referred to as gipsies; but I am sure that your Lordships will appreciate that it is difficult enough to get one Private Member's Bill on to the Statute Book and it would be even more difficult to get two. It was therefore thought convenient to incorporate these two proposals in one Bill and I hope it will receive your Lordships' support.
Part I of the present Bill is an interim measure, drawn on the lines of the Protection from Eviction Act 1964, with certain additions. That Act was in the nature of emergency legislation to meet the situation which Parliament felt necessary to deal with at that time. It affected, of course, only dwelling houses. This Bill is intended to give a measure of protection to caravan dwellers until more detailed legislation is introduced, should that be found necessary.
It will provide some degree of security and ensure some reasonable safeguards against arbitrary eviction. I do not wish to imply from this that landlords—that is to say, site operators—are bad landlords. That is not so at all. But there is a very small minority who have acted harshly towards caravan dwellers, who have no protection. Much of our landlord and tenant law arises from the fact that there has been a minority of bad landlords. That is how it works out. I think that your Lordships will agree that if there is even a small minority who do not treat the occupiers of

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caravans fairly, then it is right that there should be some legislation.
Before outlining the provisions of the Bill, I would pay tribute to the Consumer Council. They undertook a valuable survey on this subject and produced a report entitled Living in Caravans. I spoke yesterday to the noble Baroness, Lady Elliot of Harwood, who said she was sorry she would not be here today to support this Bill, but I am pleased that the noble Lord, Lord Donaldson of Kingsbridge, who I believe is now President of the Consumer Council, is to take part today. That certainly was a valuable study and shows clearly the need for some protective legislation. It is not alleged by those supporting this Bill that there is a large number of cases of wrongful eviction, although examples were given in another place when the Bill was under consideration and I have had a certain amount of correspondence right up to this morning from caravan dwellers who feel that they are placed in an unfair position and subjected to unreasonable threats. There seems to be a case for trying to remove the fear of uncertainty, which is inevitable if there is no adequate security.
In drafting the Bill, an attempt has been made to make it as simple as possible. That is the reason for following the precedent of the Protection from Eviction Act 1964. I should like to clarify one or two features of Part I of the Bill. There are different circumstances in which a caravan may be occupied as a residence. The occupier may own the caravan. He may be buying it on hire purchase. He may be hiring it from an outside source or from the site operator—that is, the owner of the site. All these cases are covered by this Bill. There has been very little legislation specifically designed to protect residents on caravan sites. The Caravan Sites and Control of Development Act 1960, which deals with the licensing and control of caravan areas, did not enable local authorities to impose conditions relating to security of tenure. Therefore, again, for that reason it seems right that there should be some legislation.
The Bill applies wherever a site licence is required or where a caravan site is run by the local authority. And
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"caravan site" is defined in the Caravan Sites and Control of Development Act 1960. The First Schedule to that Act sets out certain exemptions. I will not weary your Lordships with the details of those exemptions, but may I point out that they include the case of a caravan which is placed in the curtilage of a dwelling house incidental to the enjoyment of the house. It applies to the occasional stops by people travelling in a caravan. It applies to certain recreational sites, and to the winter quarters of travelling showmen. Therefore, they are all exempt.
Under this Bill the provisions do not apply to caravans on land made available for certain months of the year only, and they do not apply where the licence is granted for holiday use only. The intention is to cover cases where the occupant is using the caravan as a permanent residence. There are many retired people who find it pleasant, or to their liking, to live in a caravan. There are other cases where the breadwinner has a job near to a caravan site. In neither of those cases do the occupants of the caravan want to move about from one place to another; they wish to stay on the caravan site.
The nature of the protection can, I think, be summarised as follows. The Bill has these aims: to make it unlawful, without the sanction of the courts, to deprive a man of a pitch, or of a caravan and pitch which had been hired to him so that he could make his home there; to give the courts power to suspend any Order for possession that they make for up to twelve months at a time, to review or extend that period, and to fix terms and conditions and thirdly, to give protection against harassment. There have been some cases of unreasonable evictions, and there is no doubt that there is some fear and uncertainty in the minds of some occupiers of caravans. I am not going to refer to the cases which have already been discussed in another place, or even to the correspondence that I have received, but may I just mention one new example that has come to light within the last few days?
A letter was written to Mr. Eric Lubbock, who passed it on to me. I should like to make it clear that I have had no time to investigate this case, but

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it is, I think, an illustration of the insecurity of caravan dwellers. There is a certain caravan site called the Mead Lane caravan site, in Chertsey, Surrey. Apparently, on part of that site some development has taken place, and the contractors were concerned that children should not stray on to the building site. That is fair enough. But a notice was delivered by the building contractors, in agreement, I am told, with the agents for the caravan park, to all tenants of the Mead Lane caravan park. I have a copy of the notice, and it reads:
"Any personnel or children found on building site where builders are working will be given notice to quit their site within 24 hours."
That is not very clearly worded, and I presume that it does not mean that 24 hours is given to the child to leave the building site. As I understand it, the notice was delivered to all tenants of the park, and it means that any parents who allow their children on to the building site will be given 24 hours to quit their home. My Lords, it is difficult enough for parents in any circumstances to control what their children do. It is perfectly right that they should be warned, but it seems to me harsh in the extreme, if this notice is to be taken seriously, that the parents of children should be told to quit their home within 24 hours if the child is found on the building site.
I want to be absolutely fair, because this notice goes on to point out the danger to the children's safety if they wander on to this site; there are excavations which fill up with water, and a child might suffer serious consequences. This may be intended only as a warning. It was delivered by hand to all occupiers of the caravan site, and I mention it as an illustration of the lack of security. Whether they may be turned out within 24 hours, I do not know, but in many cases there is only a weekly tenancy, they could be evicted within a week, and they have no safeguard. There is the further problem that in many cases a dweller may be acquiring his caravan on hire-purchase, and if he has to leave the site he probably will not be able to find another site within a short space of time; and in that event may have to dispose of the caravan at possibly a serious loss. I will not delay your Lordships with many other harassing illustrations, but I hope that that gives some
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indication of what I mean by security of tenure.
To turn to the Bill, on Second Reading I think it would not be expected that I should outline the clauses in great detail. Clause 1 defines the application of Part I. It does so by reference to what is called "a residential contract", and that covers both a licence and a contract. Subsection (2) of Clause 1 defines "a protected site"—because we are dealing with caravans on protected sites. It explains this exemption to which I have already referred; namely, where a caravan is for holiday use only or for use during only certain parts of the year. Clause 2 deals with the minimum length of notice. This applies to cases where the tenancy or licence is not for a fixed term. If one has a caravan under an agreement for a year, then Clause 2, as I understand it, would not apply, but at the end of the year the owner or the site operator would still have to go to court to get possession. But this month's notice would apply where there is, say, a weekly tenancy, and the minimum of a month's notice would have to be given, even though the caravan was held on only a weekly tenancy.
Clause 3 deals with protection against eviction and harassment. It applies to all residential contracts, and there are three types of action by a site operator which would become a law. One is if he, during the subsistence of the residential contract, unlawfully deprives the occupier of his occupation; the second case is where after the expiration or determination of a residential contract he enforces otherwise than by proceedings in the court any right to exclude the occupier from the site. In other words, he must get an order from the court if the occupier does not go away, does not leave voluntarily. Thirdly, he must not harass the occupier in such a way that he leaves. This harassment means action with intent to cause the occupier to abandon his occupation. This is the same kind of subject of harassment as has been discussed in the case of ordinary dwelling-houses. Much of the discussion on that subject originated from the famous Rachman case. This provision is to ensure that there may not be similar kind of harassment in the case of those who dwell in caravans.

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I do not think I need to go into great detail on the other clauses in Part I. There is protection when the occupier dies. There is protection for the widow or widower of the occupier and, in default of a widow or widower, for any member of the occupier's family residing in the caravan. Clause 4 deals with provisions for suspension of eviction orders and sets out the circumstances which will be taken into account by the court in deciding whether there should be an order for possession or whether there should be some deferred order. Clause 5 provides that "the court" means the county court. Therefore, to sum up Part I, the intention of this Part of the Bill is to provide reasonable security of tenure for those who wish to live in caravans.
To come to Part II, which I can deal with quite briefly, the object of this Part of the Bill is to ensure that certain local authorities provide sites for gipsies according to need, and at the same time have effective powers of control over unauthorised camping by gipsies. May I make it clear that "gipsies" are defined as persons with a nomadic way of life, whatever their race or origin. There has been some suggestion that this is contrary to the Convention of Human Rights, because we make a distinction between those of a nomadic way of life and those who are not. But the main object of this Part of the Bill is to provide better sites for them.
The Ministry of Housing and Local Government have had long negotiations with representatives of local authorities, and I am sure that the noble Lord, Lord Kennet, will provide any information we ask for on this subject. Part II is the outcome of these negotiations. I referred to certain local authorities. These are county councils, county boroughs and London boroughs. There are limitations on this duty to provide a site. In the first place, county boroughs and London boroughs are limited to providing a maximum of 15 pitches. If no land is available, county boroughs and London boroughs can apply to the Minister for exemption, and if there is no gipsy problem in the area they can apply for exemption.
I should perhaps just mention that local authorities have power under Section 24 of the Caravan Sites and Control of Development Act 1960, to which I have
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already referred, to provide caravan sites for use as permanent residences or for holidays or other temporary purposes for people normally residing in their area, or for others, and a few authorities have used these powers to put up sites for gipsies. But the great majority have been reluctant to do so for various reasons, and there is now fairly general agreement among local authorities that the best way to make effective progress is to put a statutory duty or certain authorities so that the burden may be fairly shared.
Properly equipped camps are needed not only to provide places where gipsies can lawfully settle and enjoy basic amenities and send their children to school, but also to reduce the nuisance to house-dwellers in places where gipsies settle in numbers that cause annoyance. To ensure that this nuisance is stopped, and that expensive gipsy camps are not left unused, the Bill provides for penalties for unauthorised camping by gipsies in any area where adequate camps have been established. But in the current economic circumstances, particularly because of the implications of this Part of the Bill for local authority expenditure and manpower, this Part will come into effect only on ministerial Order. However, it will put beyond doubt which authorities will be required to deal with the gipsy problem, and will enable them to begin preparatory work in their area.
My Lords, if we accept that there are these people who wish to follow a nomadic way of life, I think it would be wrong to force them to live in conventional houses. But, if that be so, some provision must be made which is fair to them and to the rest of the community. I hope that this Bill will commend itself to your Lordships' House. I hope I have given sufficient explanation of the contents of the Bill. My Lords, I beg to move.
Moved, That the Bill be now read 2a.—(Lord Wade.)
11.29 a.m.
LORD CRAIGMYLE: My Lords, it falls to my lot to be the first to thank the noble Lord, Lord Wade, for introducing the Bill into this House. In another place it was greeted with fairly friendly voices in every part of the House, and I expect that this may prove to be so in your Lordships' House this morning.

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I shall myself be brief, not only because of the amount of Business on the Order Paper but because the noble Lord, Lord Wade, himself has so adequately gone through the Bill and expressed the intentions behind it that there is little more to add. But, although the principles of the Bill are in general agreeable to most people, there are a few details to which I may wish to draw attention in Committee.
The difficulty of the occasional bad landlord in regard to legislation is one which comes up in many aspects of policy. It is the difficulty of legislating so as to "do down the dirty dog" without making life impossibly difficult for the ordinary, decent citizen. I suspect that in Part I of this Bill the problem presents itself in the form of the following question: to what extent is it sensible to press the analogy between houses and caravans?
This Bill is based largely on the sort of procedure against harsh landlords which has been adopted in the Rent Acts and the protection from older Evictions Act. It seems to me that it is not always and inevitably the case that what is sauce for the bricks and mortar goose is also sauce for the caravan gander. This particular point seems to me to need a little more consideration, although these points were considered in another place mainly in respect of the right of succession to a tenancy or licence, to the heavy penalties imposed on the harsh landlord, and possibly also in the matter of jurisdiction. I know that there was discussion in another place as to whether it might be better to put the jurisdiction into the magistrates' court. However, these are all Committee points, and I may be able to table some Amendments on them.
There is only one other aspect of the Bill to which I hope I may refer, without being disorderly—although I fear I may be disorderly because it is not something that is in the Bill but an omission from the Bill. The Bill does not apply to Scotland, whereas Part I of the 1960 Act does apply to Scotland. I asked why this Bill should not apply to Scotland, and I was assured that it would be too complicated to make it do so. When I looked at the 1960 Act I saw that that was a valid reply, and not just an excuse,
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for in Part I of the 1960 Act there is the usual clause about "in the application of this Bill to Scotland" et cetera, but the "et cetera" does not just go to the usual half dozen or so lines setting forth different legal terminology: it runs on for four pages. So it might well be that if we tried to apply this Bill to Scotland the adaptation would be almost as long as the Bill itself.
However, that leaves us with the problem that here is a Bill to set right certain wrongs, and if it goes through—as I hope it will—they will have been set right only in respect of England and Wales. What, then, should be the next step? I merely throw this as a question into the air. The noble Lord, Lord Wade, may already have had some thoughts on the subject, or possibly the Government may have had some. Would the Government consider, in the course of the next year or two, introducing a Scottish equivalent to this Bill? Or perhaps we could look to the Liberal Party again, who do not lack for Scotsmen in either House of Parliament; perhaps they would introduce a Scottish Bill on the same lines as this.
11.34 a.m.
LORD AMULREE: My Lords, I wish briefly to support what my noble friend Lord Wade has said and to elaborate one or two points. One of the points which occurs to me on Part I of the Bill is that some associations of local authorities have expressed their opinion that caravan sites were not suitable as permanent residences. But that cannot really be the case, I think, because, provided that the sites are so arranged and equipped that they conform to the normal rules of environmental hygiene, I can see no difference in the propriety of a person living in a caravan, if he so wishes, since under this Bill the local authority would be able to take steps to get rid of any nuisance which might be made from a sanitary or an environmental hygiene point of view.
One interesting point in regard to the tenants or occupiers of caravans is, as my noble friend said, that Part I of the Bill does not apply to the casual caravan dweller who may be on holiday: it applies only to the people who want to make their caravan a permanent home. Not everyone would want to do that, but some people do, and if they are turned out of their pitch at a moment's notice,

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if they have no security of tenure, it means not only that they lose their pitch for their caravan but that their caravan becomes practically valueless to them, because until they can find somewhere else to put it they cannot live in it; and in that case it would not be at all simple to dispose of the caravan. Therefore there is a case for some sort of security such as this Bill gives in Clause 2, which is just as important as it is for people living in normal houses.
Part II of the Bill refers to the gipsies. I think it makes the law much simpler as regards gipsies, because there again some people like to lead a nomadic life, and others do not. Those who like the nomadic life do not necessarily need to be gipsies; so, as my noble friend said, the fact that they are being controlled in some way does not contravene the Human Rights Convention; nor, in the same way, is there anything racial about it. There are quite a number of people who like the nomadic way of life and who are not gipsies. They come from all parts of the world, including, I believe, Ireland. One would rather see a site provided for them by the local authority than to see, as one did in the old days, a broad grass verge with a gipsy camp on it; it looked very pretty but it was not an ideal thing, either from an environmental or from a nuisance point of view.
There is nothing in the Bill to prevent people who wish to be nomadic from moving from one site to another, but they must move to a site which has been licensed or approved by the local authority, and at the present time I do not think they can object to being submitted to some kind of discipline, instead of being able to go just exactly where they like. Therefore one has to regard the position envisaged by the Bill not sentimentally but purely practically. I think this Bill makes a good addition to our legislation, and I trust that your Lordships will give it a Second Reading.
11.39 a.m.
LORD MILVERTON: My Lords, it is true that most of the points which occur to one in the way of criticism of this Bill are essentially Committee points, and I do not propose to take up the time of the House in going into them at this
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stage. However, there are one or two points of principle. I have ascertained the views of the Association of Municipal Corporations on one of them. I am referring now to Part II of the Bill, and the Association are opposed in principle to the idea of placing upon local authorities at the present time any obligation to provide sites for gipsies. This, it seems, can only mean increased local government expenditure in a financial climate in which the Government have called upon every possible retrenchment.
One hopes, at least, that an assurance will be given by the Minister that this Part of the Bill will not be brought into force until he is satisfied that affected local authorities are in a position to meet this expenditure. Furthermore, in many areas it would seem particularly inappropriate that such an obligation should be placed upon any urban authority. Urban land is scarce enough in all conscience, and towns are surely not appropriate places for these sites.
Turning to Part I, the Association feel some difficulty over the apparently conflicting issues: security of tenure for residential caravan occupiers, in order to prevent hardship, and the question whether caravans are suitable as permanent dwellings. The Association have come to the conclusion that they are not. It is recognised that there is a need for provisions of this kind to be enacted, but it is felt that some Amendments need to be made to limit the protection given by the Bill to permanent residential caravans, and not to include caravans used for holiday and other temporary purposes, and also that certain limits should be placed on the power of the county court to suspend orders for possession.
There are a number of other points, as I have said, which are better left for the Committee stage, but perhaps I may mention two of them today. Perhaps there ought to be Amendments to strengthen the provision as regards prohibition of unauthorised camping and enabling local authorities to recover their expenses in the matter of removing caravans. That is all I wish to put before the House at the moment, because there are many Amendments which we think may improve the Bill in Committee.
11.43 a.m.
LORD WILLIS: My Lords, I also wish to give a very warm welcome to this Bill. I have one major criticism to make of it which I will come to in a moment, but I believe that Part I in particular gives the essential protection necessary and brings the caravan dweller really into line with the house dweller. I think it is inevitable that we have had an increase in caravan population in the last few years and that we are likely to have it in the future, because of the housing shortage, because of the growing reshaping of industry and the need for people to move quickly, and partly because the caravan industry itself turns out such splendid caravans now that some of them I have looked at I should dearly like to live in myself.
There is a third aspect, and this touches on the criticism I would make of Part II. This third aspect is the desire of a small number of people—perhaps the desire of the majority of people—to be free of the constrictions of the concrete and asphalt jungles which are becoming part of our civilisation. Some resentment is felt by worthy tax-paying citizens about anyone who appears to opt out of their responsibilities to the community, and this is understandable; but is there not perhaps also some jealousy and envy in our attitude towards the true nomads? All the poets speak of the great longing; we all know Yeats's poem about the Lake Isle of Innisfree. I do not think there is anybody in what they call "the rat race" who does not feel a yearning to get away from it at times. I think there is something in our attitude to the nomad of envy.
We have, where I live, an old gentleman who is called Smokey Joe, who has been "foot loose and fancy free" for forty years or more. He has not got a caravan; he lives where he can and how he can. He is a local character; everybody befriends him. He prefers to live that way. The police take him in every winter. He is installed in a hospital and fed up and cleaned up, and as soon as he gets the opportunity he escapes and goes back to the nomadic and free life. I personally should not like to live like that, but I admire and respect his desire to do so. And I believe he is a very well educated man.
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What I regret about Part II is the fact that "gipsy" is spelled with a small "g". I know there is some judicial background for this, but just the same it is a pity. It is like calling everybody who comes to your Lordships' House conservative. We know that could not conceivably be true. And to lump all nomadic peoples together, and particularly the small genuine section of Romany, and to spell it with a small "g" is, I think, partly in some cases an insult to the true Gipsy, and sometimes is misleading. There is in the public mind a kind of double image of the gipsy. We have the dark, romantic, camp-fire, fiddle-playing image of the gipsy, and, on the other hand, the image of them as being rogues and thieves and cheats and fortune-tellers. But we ought never to forget that they are a race with a culture of their own and that 400,000 of them were executed, as the Jews were, by the Nazis. And we have still in this country a small but important group of true Romany people, who I believe are entitled to some consideration, who have hardly anybody to speak for them, and who tend to be lumped in this Bill together with other people for whom perhaps there is not quite so much to be said.
We all know that the true Gipsy is proud and clean and independent, and it is true to say you could eat a meal off the floor of the true Gipsy's caravan. I remember years ago there was a field at St. Mary Cray where we had the Gipsies in one corner, the true Romanys, with clean caravans, and the site they occupied was spotless; and in the two-thirds of the site occupied by the other travellers, it was filthy—the horrible sight we have seen so often along the trunk roads of our countryside and even some of our beautiful lanes, where cars are broken up and the whole thing is made filthy and unpleasant. This is not the work of the true Romany or Gipsy. In fact, the true Romany is very contemptuous of these people. He divides them into categories. There are first of all the didekeis who are half Romany blood. Then there is, secondly and picturesquely, a group they call the "posh rats", who have some Romany blood but very distilled. And finally there are the people they call simply the

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"travellers"; and they are very often people who have been forced to travel for various reasons.
Perhaps we have to face the fact that modern society, with its trunk roads and motorways and the shortage of land, has made it almost impossible for the true Gipsy to survive, though I understand that in Wales there are still true Romany families living together, pursuing the old crafts which they have pursued for centuries. By his very nature the Gipsy must exist as a nomad if he wishes to follow his way of life—and I speak always of the Gipsy with a capital "G" so that you will understand I am speaking of the Romany. He must exist near centres of population, outside them; and with the growth of our society it often happens that just outside these population centres there are no sites, or very limited ones. Land is now tremendously valuable. And, of course, he has been swamped out and his image ruined by the didekeis and others of whom I spoke.
It is true that his life is poor, because, again, modern society has taken away from the Romany the opportunity that he had to sell his arts and crafts. You can turn out from a factory hundreds of thousands of those horrible plastic flowers which are a substitute for the sort of real thing that the Gipsy used to make by hand and bring round and sell, or the real thing that he used actually to pick. And the great trade in clothes pegs has almost gone out of demand, with the tremendous growth of the spin dryer and other accessories of civilisation. So it may be true that he will have to be absorbed and assimilated. Perhaps the passing of this Bill will make it easier to face that inevitable process, but I should find it extremely sad if we could not do something to save that rare and rich culture, to separate in some way the true Romany from all the hangers-on, and to give him some special consideration as an essential and colourful part of the life of these Islands.
Like other noble Lords, I have one or two comments that might be better suited for the Committee Stage. I should like, for example, to raise a question on Clause 10, which was, I understand, raised in another place but which I think is important and underlines the point that I am trying to make. The only phrase
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that I am concerned with at the moment is that which deals with the fact that it will be an offence for "any person, being a Gipsy". It seems to me that this is discriminatory. I know that the movers of the Bill did not intend it to be so, but it is in practice, and it will continue to be. It is clear that they were trying to avoid a situation where the ordinary citizen, out with his car or his trailer or his caravan, could not park for one night. What this Bill does in its present form is to say that you can go out with your Jaguar or your Ford Consul with the trailer behind it and park for one night, because you are not a Gipsy and you can prove it. But any true nomad under this clause of the Bill cannot park for one night.
It seems to me that this is discriminatory. There may not be sites within easy driving distance. It may take two or three nights to get from one authorised site to another. That seems to me to be a point to which the noble Lord, Lord Wade, with the noble Lord, Lord Kennet, might give consideration, to see whether there is not some way round it. I understand the difficulty and that one does not want people taking up a long residence, but it seems unfair that people who have lived this nomadic way of life for centuries should not be any longer allowed to park even for one night in other than an authorised place.
There are other points that I should like to raise on Committee. I have been approached by a Gipsy Support Group to raise one or two other questions, and I shall perhaps be putting some of these down as Amendments. But there is one other point that I might draw to the attention of the Government and ask them to comment on. It is a matter which I think is of some urgency. If the operation of the sites is to come into effect only by a special Order, may I point out that it is likely that there will be serious hardship this winter, and is it not possible in the interim for the Government to make some emergency proposals for temporary sites, not perhaps up to the standard of those that we hope eventually to build, to allow for these people?
Secondly, is it not a little unwise to spread the ratio of 115 per county borough as is suggested in the Bill, regardless of the distribution of the gipsy

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population? For example, for many years Kent has been a great home for the gipsies. After all, it is a beautiful county and it is the Garden of England. I believe that we in Kent have a population of something like half of the total (I am using the word with a small "g") of gipsies, and I think that in some boroughs or areas where we have had a traditional number of people living with us the number of 15 is quite small. In those cases it would seem to me that something like 30 might be more reasonable. Again I understand the difficulty, but it is an important matter.
Finally, I should like the Government to comment on this point. What is to prevent the local authority from taking stern measures in one way or another, to drive off its gipsy population for the moment, and then send in a full return to the Government saying, "We have no gipsy problem. We have nobody here"? That seems to me an important aspect that ought to be considered. But, coming back to my main point, I hope that the sponsors of the Bill and the Government will give serious consideration to the true Romany, to see if something cannot be done even to register these people, so that their culture and their distinctive characteristics will not be driven away from us.
11.57 a.m.
LORD WAKEFIELD OF KENDAL: My Lords, I shall not detain your Lordships for any length of time this morning because the noble Lord, Lord Wade, has already fully and carefully explained the purposes of this Bill. However, at the outset, I should like to declare an interest, in that I am a member of the National Caravan Council, which is the representative body of the British caravan industry. Parts I and III of the Bill concern the caravan industry and the owners of caravan parks. As has already been pointed out, Part II gives power to—in fact, it requires—local authorities to provide sites for gipsies (with a small "g" I think), where the need is apparent, and this does not directly affect the industry.
I am sure your Lordships were all extremely interested in what the noble Lord, Lord Willis, said about the Romany population of this country. I hope that during the further stages of
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this Bill it will be possible to do something, somewhere and in some way to meet the extremely important and interesting points that he made in his speech, dealing mainly with Part II. The National Caravan Council applauds the intention of this clause, as this should effectively put an end, if not immediately then in the not-too-distant future, to the eyesores of untidy encampments on roadside land and verges. These have been the caravans that so many people have seen and which, I regret to say, have undoubtedly coloured their opinion of caravans generally. They have brought disrepute on this industry, which is doing an extremely valuable export trade, and adversely affected its wider acceptance.
Regrettably, too many of our fellow citizens, in spite of the Arton Wilson Report, still seem to think of caravan residents as sub-standard people living in sub-standard accommodation. This is quite untrue. The industry generally welcomes Part I and what it sets out to do. However, I think that the point may be clearly and firmly made that the vast majority of caravan park owners run well-ordered parks, to the complete satisfaction and great enjoyment of those living on them, some 90 per cent. of whom, I think, own their own caravans and thus are home owners. It may be true that a quite small minority of caravan park owners have given cause for complaint on rare occasions, but does not this happen in all forms in the modern complex society in which we live? It is therefore very much in the interests of the industry that whatever cause for complaint there may be should be removed and firmer legislation, as there is in this Bill, is, I think, the way to do it.
Part III sets out to correct a defect chat has become apparent in the Caravan Sites and Control of Development Act 1960. This defect is in respect of the definition of a caravan, and particularly twin units. The industry have been anxious to get this put right as soon as possible and will be content if all that is required is achieved in this Bill. But we should welcome an assurance that it does in fact achieve all that is required, because while the 1960 Act applied to England and Wales and Scotland, Clause 17(3) of this Bill, which by Clause 13 purports to amend Part I of the Caravan Sites and Control of Development Act

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1960, says that the Bill does not extend to Scotland. The noble Lord, Lord Craigmyle, has drawn attention to this matter and, like him, I should like some clarification. Is it the case that Part I of the 1960 Act is amended in relation to Scotland by this Bill? This is a very important point and one on which we must be quite clear. May we have an authoritative answer from the Government Benches? It would be extremely helpful if the noble Lord who is to reply to this debate on behalf of the Government could give a helpful and constructive answer on this point which clarifies the matter.
I think we must also be careful not to make it too difficult to remove a disreputable element from the caravan community, any more than in a housing estate. I have available with me here evidence of the militancy of some of the caravan residents' leaders, of how police have had to be called in because of disturbances at local council meetings. Indeed, one demonstration was on behalf of a family evicted from a local authority park for failing to observe the rules. Therefore, in the interests of the other caravan owners on the estate, or any estate, we must see that where a caravan resident does not behave as he should there are certain sanctions against misbehaviour.
This Bill has had a rapid passage in another place. Like other legislation now coming before your Lordships' House, it seems that there are improvements to this Bill which could be made with advantage, as other noble Lords have already said, and therefore some Amendments will be laid for consideration during the Committee stage. They will certainly not be wrecking Amendments but will be aimed at making the Bill a better one.
For example, the Caravan Council think that the protection provided in Clause 1 to caravan residents may be drawn too widely. Certainly it goes beyond the protection now given to people living in houses and fiats. This surely is not right. There is no evidence that I know of to show that caravan residents are less well off than those living in homes which are not mobile. We should not in any way wish to condone harassment, but we believe the penalties may be worthy of review. Accordingly, it is proposed to table appropriate Amendments for further
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consideration because of the point made previously about not weighting the Bill too heavily in favour of the residents.
The National Caravan Council think that a case can be made out for removing the provision in Clause 14 that local authorities may institute proceedings on behalf of third parties. Furthermore, the Council think that cases under the Bill should go to the magistrates' court, and not to the county court as provided in Clause 5, because of the need for faster action than the county court is likely to provide, and the need to spread the, load, as well as the fact that the magistrates' court, because of its licensing responsibilities, has local knowledge of the place.
There are further points of detail in respect of definition which will be raised in discussion of Part III of the Bill, though I need not trouble your Lordships with them in this Second Reading debate. I have indicated some points which will need consideration during further stages of this Bill, but in principle, as I have already said, the Caravan Council welcome and support this Bill.
12.6 p.m.
LORD DONALDSON OF KINGS-BRIDGE: My Lords, may I begin by thanking the noble Lord, Lord Wade, on behalf of the noble Baroness, Lady Elliot of Harwood, and the Consumers' Council for the kind words he said about us. I cannot claim to be its President, but I can claim to be its new Chairman, and we are very proud of our association with Mr. Lubbock and now with Lord Wade in pursuing the background which has provided the information on which the main provisions of Part I have been based. The noble Lord, Lord Wade, referred to what I think is called, "Living in a Caravan" pamphlet, which was issued by us after a professional survey covering over 500 caravan dwellers.
Although there is general agreement in the House in favour of the Bill, some of the remarks of the noble Lord, Lord Wakefield of Kendal, make me think that it might be as well to mention or e or two facts which go somewhat in the opposite direction. For example, arising out of this survey it was found that 70 per cent. of dwellers were on one week's agreement, or did not know what the agreement was, which is a rather high figure and not at all what you would

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find among dwellers in ordinary housing. Fifty per cent. of those who dwell in caravans have no written agreement at all; 50 per cent. of the sites have communal lavatories; one quarter of the caravans have no water laid on to the van, and roads and footpaths were often very unsatisfactory. The most interesting theme running through all the complaints—and out of 450 letters received preliminary to the survey 75 per cent. contained complaints—was the threat of the fear of eviction. Many of these people, though by no means all, are fairly simple people. There is a shortage of sites and people are frightened of complaining to their landlord or to the site operator about things which he would very likely put right. They are frightened of doing so because they are afraid of losing their site.
I feel that the noble Lord, rather naturally, made things sound a little more satisfactory than in fact they are. Many caravan dwellers will have accepted the situation of second-class housing because they cannot find anything else. The inquiry showed that 44 per cent., I think it was, said, "If we had the chance of a house we would go to-morrow". A large proportion of the remainder probably live in caravans because they like doing so, and good luck to them. But it is always the weaker half who need protection, and at least we know that 44 per cent. of those who were living in caravans at the time of the inquiry did not want to do so.
If one buys a lease of a flat in London to-day one often gets landed with £1,500 worth of somebody else's execrable taste in curtains and carpets; and something not dissimilar happens on caravan sites. The question of taste does not come in, but there is something called a connection charge which should, of course, be paid by the original owner of the caravan and should, and usually is, paid week by week. But there is a tendency for some site operators to charge newcomers with this connection charge, although the charge may have been paid off.
I do not want the noble Lord to think that this is true of all operators; it is not. But it is an abuse which exists. Our figures show that 27 per cent. of the people asked were paying some kind of site premium, ranging from £25 up to
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£200. I do not say that premiums were always as high as that, but there were some very high ones. An even worse abuse is that some site owners will let pitches only to people who buy caravans from them. This is a sort of double "closed shop": it means that if you leave the site you have to sell your caravan, probably at a loss, and buy another to get on another site. I assure your Lordships that everything is not all right in the caravan world. There is a corner of it which needs to be looked at. My noble friend Lord Royle has already a Bill before your Lordships dealing with overcharging through electricity meters, but this is another field in which we have had evidence.
In any slightly embarrassed group (and I think that the people who live in caravans because they cannot get anywhere else inevitably become so) there are always a number of people who find life too difficult for them, who get into worse and worse conditions, and who are on the way down. These are the people who cause the trouble to which the noble Lord referred. There are difficult people who have to be dealt with, but I feel that the provisions of this Bill cover this problem quite adequately.
Somebody must decide what is to be the national policy towards caravans. Are they to be accepted as a contribution towards the solution of housing problems for many years to come, or are they, like the "prefabs" (which were put up with a four-year life, or whatever it was, during the war and which are still in existence all over England) to be a permanent contribution to a shortage which is not quickly going to be overcome? If they are to be a permanent contribution—and my view is that at the moment they are nearer that than anything else—it would be wrong for local authorities to grant them short-term permissions. They ought to grant indefinite or very long-term permissions, since short-term permissions will not encourage the site operator to make his site really good, because he knows that after a time he is going to lose his investment, and it gives him an excuse for not doing the things that he ought to do.
My own view, and that of the Consumer Council, is that it is a great pity we cannot bring local authorities into the

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same category as everybody else. This matter might be further looked at. Although they are defended by a democratic process, local authority sites are of no higher standard than those of other owners. They do not have the worst sites, but their sites are not better than average.
When it comes to Part II of the Bill, I speak on my own behalf rather than for the Consumer Council, since we have not felt that the special problem created by gipsies (whether with a large "G" or a small one) is necessarily a consumer problem. For my own part, I feel that they are an oppressed minority. I strongly favour giving them some kind of stability of existence in this country. I believe that there is some real persecution here, although it is not directed at the upper class gipsies of whom we heard from my noble friend Lord Willis—and it is a great satisfaction to me to find myself, for the first time in my life, very slightly to the Left of him on this point. It is not the upper class gipsies with these long pedigrees who are persecuted: it is the tag-end who are the difficult problem, and the problem families whom we meet everywhere.
Everybody always shoves them on to the next man. This is a symbolical example of what is happening in hostels, in prisons and lunatic asylums. There is always a tag-end which is being shoved on, and some of these people live in caravans. It is a very unsatisfactory situation that they should be pushed from pillar to post, even though their pedigree may not be good enough to satisfy my noble friend. I have been woken up late at night by a member of the Simon Community to say that he had three caravans with nowhere to put them. This is not an unknown thing, but these families were difficult, and this problem is a real one.
Part II of the Bill seems to do what should be done: it makes provision for a minority group, some of whom are of perfectly good behaviour and some of whom are not, to live as citizens in this country. It provides them with sites, and, having provided them with sites, tells them quite reasonably that they cannot go anywhere else. This is a satisfactory situation but I observe a reluctance on the part of local authorities to shoulder this burden. Who can blame them? It is bound to cost money, and the difficult
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members of these communities are fearfully difficult and pose a great problem. I agree with my noble friend Lout Willis that this Bill should not be long delayed. I find myself in the position of being able to support both Parts very fully, to congratulate the noble Lord, Lord Wade, on bringing the Bill through with so little opposition, and to hope that it will go through your Lordships' House as easily as it went through another place.
12.16 p.m.
LORD MOTTISTONE: My Lords, intervene briefly in support mainly of my noble friend Lord Wakefield of Kendal. I have no personal association with camp ownership, but I have been informed of the difficulties by a neighbour who has. I shall therefore restrict myself to Parts I and III of the Bill; though I am tempted to include some remarks on Part II, having heard the fascinating comments of the noble Lord, Lord Willis, on that Part and about the people whom it affects.
Referring to Parts I and III, I support the Bill in principle, as I think all speakers have done so far, but there are various aspects of it which I am sure will require amendment. There are two particular points that I should like to emphasise. The first is that the Bill appears to me to be excessively biased against the camp site owner. Surely it is wrong, if one can prevent it, to have an Act of Parliament which is biased excessively in one direction or the other. Can it not be said that if you bias a Bill excessively against one particular group of people, you are liable to lead to more rather than less law-breaking? It is necessary to make sure that the Bill provides for penalties on those who deserve them, but surely we should not legislate with the "lunatic fringe" primarily in mind. Although one has heard the statistics quoted by the noble Lord, Lord Donaldson, I suggest that in this case perhaps we have the lunatic fringe primarily in mind.
The second point which might be considered by your Lordships relates to the special social conditions on a camp site. One has up to 20 families per acre, a large proportion of whom, on any statistical basis, are people who prefer a mobile home to a fixed abode. I suggest that this means they are people of independent mind and thought who

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wish to have the sort of freedom that a mobile home can give them. With people of independence gathered closely together in a comparatively small area, there must be certain social problems. Good site owners, I think, recognise that fact, and take responsibility for ensuring that those social problems are smoothly overcome. I therefore suggest that it is very important, in a Bill of this sort, to encourage site owners to take that social responsibility which is surely a very necessary part of their task, but which this Bill makes no attempt to do. In fact I go further and say that parts of this Bill could be interpreted as describing the site owner as a wicked home-breaker, equivalent to the worst type of slum landlord for whom heavy penalties have to be provided.
I do not believe that it is going to be possible, by a process of amendment, to alter this Bill so that it lays sufficient emphasis on the need for encouraging the social responsibility of the site owner. But I understand, from having read the reports of all the debates in another place, that this Bill was regarded as a holding operation and we have heard this morning of a further Bill that is to be brought in later. What I should like, therefore, to do at this stage is to suggest to the Government, and to anybody who may be concerned with the introduction of another Bill of a rather more permanent sort, that they should give great consideration to the need for encouraging the social responsibilities of the site owner. They should encourage him to do his job well, rather than produce legislation which penalises excessively the site owner who does his job badly.
12.22 p.m.
LORD SEGAL: My Lords, I had not intended to intervene in the debate on the Second Reading of this Bill, but I hoped that some passing reference might have been made to the extremely difficult role played by the police in dealing with this problem and to the conspicuously tactful way in which they have invariably carried it out. I have been quite amazed at the degree of sympathy, understanding and forbearance shown by the police, sometimes in very difficult circumstances. Although initially, when this Bill is passed, Clause 11, deal-
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ing with the removal of unlawful encampments, may involve the police in rather heavier and perhaps even more distasteful duties than they have had to carry out previously, I profoundly hope that within a period of two or three years the police authorities will have their labours considerably lightened by the Bill when a greater degree of social responsibility is realised by those with whom it has to deal. At this stage there is little else that is called for on my part, except that I would endorse the remarks of my noble friend Lord Willis about Clause 10, and I cannot help feeling that the three words "being a gipsy" might have been better left out.
12.25 p.m.
VISCOUNT MASSEREENE AND FERRARD: My Lords, I apologise for partaking for a moment, but as I initiated a debate on gipsies I should just like to say a few words on Part II of the Bill. While I welcome the Bill most heartily, there is one point that rather worries me. I am not a lawyer, but it appears to me that under this Bill you can commit a criminal offence by doing something if you are a gipsy, but if I, for instance, do the same thing I shall not be committing an offence. If I park a caravan on or near a lay-by and make a filthy mess I shall not be committing an offence, but if I were of a nomadic way of life I should be committing an offence. I quite understand that this is a very difficult matter to put into law, but I always thought that the act constituted the offence and not the type of person who committed it. However, I suppose it is almost impossible to evolve a form of words that would make the position strictly fair.
I also should like to make what is perhaps a Committee point and draw attention to Clause 8 which deals with the acquisition of sites by councils. It is obvious that any council or borough desiring to purchase a site for gipsies is bound to encounter a great deal of opposition from neighbours around that site, and I was wondering whether it would speed up the acquisition of sites if some compensation were payable to those people, because, rightly or wrongly, a great many people have a horror of having gipsies just beside them. There are a great many decent and extremely

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honourable gipsies, but there are some very untidy ones whom I would call travellers and not true gipsies.
I think that paragraph (a) of subsection (1) of Clause 10 is excellent, because there have been so many instances of gipsy encampments near highways. I have personally known of accidents to the children of gipsies, owing to their proximity to the highways. So I very much welcome that paragraph. I would point out that in Clause 16 we have the definition of "gipsies", which means
"persons of nomadic habit of life, whatever their race or origin".
But, as the clause says, that definition does not include
"members of an organised group of travelling showmen, or … persons engaged in travelling circuses, travelling together as such;"
I presume that the members of an organised group of travelling showmen can make just as much litter and general mess, and can cause just as much disturbance on a site in the country as gipsies.
Coming back to my earlier point, I cannot see how in law there can really be any distinction so that an ordinary citizen who takes his caravan on holiday is not prosecuted for being untidy because he is not a gipsy, although if he were a gipsy he would be prosecuted. Presumably you could prosecute the ordinary citizen under the Anti-Litter Act, and perhaps that covers it, but I should just like to make that point in defence of gipsies, because some gipsies are very decent people.
12.30 p.m.
LORD CHORLEY: My Lords, caravans tend to be blemishes on the beauties of the countryside, and indeed to disturb the amenities of rural England, as do caravan sites, particularly if they are not well sited. The noble Lord, Lord Wakefield, is very experienced in this, and I think we all congratulate him on the admirable way in which he sited his large caravan site on the shores of Windermere. This Bill, therefore, has naturally received a good deal of attention from those of us who are concerned about the amenities of the countryside, and has been anxiously looked at by the Council for the Preservation of Rural England. I am glad to say that, as we see it, this should be a helpful Bill from our point of view, and
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we certainly would not wish to oppose it. Indeed, we feel that it makes a distinct contribution to the solution of our problems.
12.32 p.m.
LORD LEATHERLAND: My Lords, I shall be brief. I had not intended to intervene in this discussion this morning, but I think that one voice has so far not been heard. We have heard one noble Lord proclaiming himself as a Scot; we have heard another noble Lord proclaiming himself as interested in caravan manufacture; we have heard my noble friend Lord Chorley proclaiming himself as a lover of the English countryside; and we have had my noble friend Lord Willis proclaiming himself as a gipsy-lover. I can claim to be none of those things, but I have for 25 years had a very close association with local government, and as local government is destined to have a very important part to play in the implementation of this Bill, I should like to say a word from their point of view.
But first there is one comment I should like to make about Part I, which is the "non-gipsy" part of this suggested legislation. The noble Lord, Lord Wade, said and indicated in many ways that this Bill was based largely on the philosophy of the Rent Acts as we have known them for the last forty years or so, but there is one feature of the Rent Acts which does not appear in this Bill, and that is some measure of rent restriction so far as caravan dwellers are concerned. There is wholesale racketeering going on by the proprietors of sites who are letting them out to caravan dwellers at so much a week. They are letting out sites for one caravan to various caravan dwellers at very high rents indeed, and I sincerely hope that before we finish our Committee stage some consideration will be given to this aspect of the question. I am not suggesting that it will be an easy matter to deal with, but there are some people making gigantic fortunes by buying up a piece of farm land cheap, putting in a few elementary facilities and then charging exorbitant rents.
I now want to turn to Part II of the Bill—that which deals specifically with gipsies. My noble friend Lord Willis was most poetical and lyrical about them. I almost fancied at one time he was

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singing us an "Air on a capital 'G'string." I am not a gipsy, and I have not had much to do with gipsies. They used to steal my chickens occasionally when I had a place in the country, but I like them as much as anybody else. However, there is another side to this question. I am a member of a small public authority which is responsible for an area accommodating a population of only about 80,000 people, and yet we have gipsies camping on two or three sites in our area where they tear down trees in order to make their fires, dump their rubbish in our water-courses and dump the old cars from which they have stripped the saleable material. It costs us, a small authority, over £5,000 a year to clear up the mess that they leave behind them. So while we sing lyrically about the gipsies, let us look at that side of the story as well.
In those circumstances, of course, if we look at this realistically, it is much cheaper for a local authority to buy, equip and provide a proper caravan site where matters can be kept under some degree of supervision. Of course—and nobody has touched on this point this morning—it is an expensive undertaking for a local authority to buy and equip a caravan site. You cannot properly equip one for 15 or 20 caravans at less than £20,000, and when the treasurer or the finance committee chairman of a local authority goes to his council on budget day and says, "I want £20,000 to set up a site for 15 gipsy families", he finds that it is a very difficult thing for him to put over. I am one of those people who has been putting this over on the authorities with which I am connected for some years; and, of course, we find ourselves faced with difficulties. It is not merely sufficient to say in this Bill, "A local authority shall provide this site, shall provide these facilities".
The county council of which I have been a member for 22 years has recently embarked very enthusiastically on attempts to solve this gipsy problem. We found one site, and we immediately had a petition from the villagers saying they would not have it at any price. We therefore looked round for some other accommodation in that area, and one small local council was good enough to say that it would provide 12 of its council
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houses—three a year for four years. But that did not find much favour among the gipsies, and ultimately that proposal was withdrawn, and one could quite naturally understand the reasons why. So we had to abandon that site. We then went to another site. We thought it was perfect. It was the remnants of an old war-time aerodrome, with lovely concrete runways already standing there to make hard-standing sites for the caravans. It was delightfully shielded from public view by a row of tall trees on one side and a long hedge along the road. But as soon as the negotiations began to be whispered about, the farmer broke up the concrete runways, ploughed up the field, cut down the trees and trimmed down the hedge. The position became impossible. The farmer's actions had ruined all those natural facilities which were destined to make it into an ideal caravan site, so my county council had to call off the negotiations. Now the landowner's solicitors have sent us a bill for his costs, and it looks as though we have got to pay them.
Then we searched round for another site. We saw an old R.A.F. camp—not an aerodrome, but a camp where R.A.F. tradesmen had been trained for their respective trades. We found that and we were going ahead with it. We asked Ministerial permission, and we got it. Then we sent our surveyor round to make a more detailed examination, and we found that the whole place was honeycombed with sewers and pipes and manholes which would have made it an absolute danger for any gipsy children who might have been living there. So we had to call that off. Then we found another place, apparently ideal in every way. That called forth a warm protest from the villagers. They applied to the Ministry for a public inquiry, and we are now waiting for that public inquiry. It will probably be another 12 months before we can dig a single spade into that site.
The trouble, my Lords, is that when you hand this job over to the local authority, even though the local authority is philosophically very eager to get on with the job, you find that the local council is composed of various members who come from various parts of the district. One of them will represent a ward, one of them will represent a little

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township, another will represent two or three villages; and as soon as you mention the name of a place there is wholesale opposition from the representative of that place. It is something like the Stansted Airport story, my Lords: we all want an airport, it is absolutely essential, but it must not be in our own district. That is the trouble, looking at it realistically, with which local councils are going to be faced. I am not saying that it is a trouble which cannot be overcome, but we must not look for too speedy action from the local authorities, enthusiastic though they may be in their endeavours to solve this gipsy problem.
I have only one more thing to say, and that is with regard to the suggestion by two noble Lords that magistrates' courts might be better than the county courts for settling the problems that arise under this Bill. I have been a magistrate for a long time, for a quarter of a century. I do not think that magistrates' courts would be suitable. Magistrates in any given area are men who may own land, who may own houses, men who are tied sentimentally to their own districts. It would be putting an unjustified burden upon them to ask them to adjudicate on matters of this kind. I like the distant independence of the county court judge who goes round on circuit and who lives probably 40 or 50 miles away. I think that would be a much better medium of justice through which to settle any troubles that arise under this Bill. Finally, my Lords, I welcome the Bill and hope that, with Amendments, we shall give it a speedy passage.
12.42 p.m.
THE PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD KENNET): My Lords, I think there is little to be said from the point of view of the Government except to confirm what the House already knows—for it was said in another place: that the Government welcome this Bill and are grateful to Mr. Lubbock and to the noble Lord, Lord Wade, for introducing it in the two Houses of Parliament and have contributed largely to its drafting. While I am on the subject of thanks and congratulations I must of course mention the Consumer Council, of which the noble Lord, Lord Donaldson, has already
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spoken, and congratulate them on their Report, Living in Caravans, which excavated a great deal of the primary material needed before legislation could be framed, and also to congratulate once again our own sociologists in the Ministry of Housing and Local Government. I did this a year ago in this House and I do so again. They produced a large sociological report on gipsies which excavated the rest of the material necessary for Part II of the Bill.
I will take up one or two points which have arisen in the debate and which it seems to me the Government should answer. They are mainly questions of fact. Several noble Lords asked about a Scottish Bill. Let me say at once that this Bill does not apply in any respect to Scotland. So far as a Scottish Bill is concerned, the Government will keep an open mind and consider any evidence of the need for fresh legislation in Scotland. At the moment we know of no very crying need for it, but I can say that it should not be difficult to convince the Government of such a need, if it existed. This is rather a question of wait and see. The Government are waiting and seeing, too. On the one detailed aspect of that point, I think it was the noble Lord, Lord Wakefield, who asked about twin trailers in Scotland. The 1960 Act is not amended in Scotland by this Bill. I think that answers that factual point.
My Lords, let me turn now to the comparisons which have been made by several speakers between the degree of protection afforded to caravan dwellers by Part I of this Bill and the degree of protection afforded to house and flat dwellers, bricks and mortar dwellers, by the Rent Acts in general. I think I heard one noble Lord say that the protection in this Bill for caravanners went beyond what is available to the householders. I was astonished to hear that. If any noble Lord cares to read the Protection from Eviction Act 1964 and the Rent Act 1965, he would find that this Bill does not begin to approach the degree of protection afforded by the present law to the bricks and mortar dweller.
I turn now to Part II of the Bill, the gipsy part. I should like to repeat what has been said in another place—and I am sure that the Association of Municipal Corporations are aware of it; that

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there is no question of Part II of the Bill coming into force immediately. This must await economic circumstances when it will be justifiable to lay this expenditure on the local authorities; it will await that turn of events. I am anxious to avoid mentioning any time. It is the Government's wish to bring this Bill into effect as soon as possible, but now is clearly not the time. On the question of Clause 10, which bothered several noble Lords, let me say I can understand their worries about it. Parliament must always look closely at any proposal that a given action may be an offence when it is committed by one class of person but not when it is committed by another class of person. No doubt, in Committee the House will examine this clause closely.
Without prejudging anything that may be said, I should like to point out that Clause 10 hangs together with Clause 6, which lays on the local authority a duty to provide the sites for the gipsies. In so far as it is true that gipsies are discriminated against by Clause 10 (which allows them to be moved on in certain circumstances), it is equally true that there is discrimination in their favour under Clause 6, which requires the local authorities—lays a duty upon them—to provide camping sites for gipsies only, and not for any other class of person. Also, of course, when Clause 10 comes into effect in a given area it will not have the effect that the gipsies there may camp nowhere but on approved sites; they may always camp on private land, with the permission of the owner. In any case, camping on private land without permission is already a trespass; this clause makes it a criminal offence. But they may not camp on waste land or on verges. It does not affect their camping on private land with permission.
Then they have a wide range of defences against this charge by saying that somebody was ill, that there was a mechanical breakdown, or even that there was an unspecified emergency. It seems to me that a gipsy who stops for one night on the verge on the way between two authorised sites is unlikely to be unable to sustain a defence of some unspecified emergency and is unlikely to be charged with it. A local authority is going to worry about unauthorised encampments but not very much about
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one gipsy caravan which stays for one night on the verge. But we shall see how this works out.
My Lords, lastly, but most important, Clause 10 is going to be brought into operation only when the Minister is satisfied either that there are a sufficient number of Clause 6 sites to cope with the gipsies in the area or that there are no gipsies in the area at all. This is the meaning of the proviso on the bringing into effect of Clause 10. Having said that, I do not wish it to be thought that I am minimising at all the unusualness of defining an offence by the person who commits it and I would not prejudge anything that any noble Lord may wish to say in Committee on this point.
I think that this is probably all that your Lordships will wish to have from the Government at this moment. This Bill, we think, is a considerable step forward in reaching a necessary degree of protection for caravan dwellers who at present have far too little of it, compared with house dwellers and also in reaching what one hopes may be a stable position in this troublesome situation between gipsies and the rest. There are only about 15,000 gipsies in the country. It ought not to be impossible for local authorities to set up enough camping sites to cope with the lot at any one moment and to allow them freedom to go from one site to another whenever they wish. For those who want to settle down, move into a bricks and mortar house, send their children to school, it should be an object of general social policy to help them to do so. But I expect that all noble Lords will agree that it should not be any object of our social policy to compel or press any gipsy who does not want to settle down to do so. And in the Government's opinion this Private Member's Bill is a good step forward in the direction of achieving that balance.
LORD WILLIS: My Lords, before the noble Lord sits down, I wonder if he could make some comment on the point which has been reinforced by what he has just said, about the need for some kind of emergency action for the coming winter? Would it not be possible for the Government to recommend the making of some temporary arrangement, to meet possible hardship this coming winter, before the sites are available?
LORD KENNET: My Lords, I apologise, I forgot that. There are really only two actions open to a Minister, the first being to introduce a law and enforce it. Private Members have introduced this Bill, and it is the intention of the Minister to enforce it as soon as economic circumstances permit. The other action open to a Minister is to exhort persons or bodies to do this or that. This, if I may put it colloquially, the Minister has done "until he is blue in the face." Circulars have gone out, couched in increasingly urgent language, to local authorities asking them to get ahead and provide these sites even in advance of the compulsion provided by the Bill. I will, if I may, send copies of the circulars to the noble Lord.
LORD BRAYE: My Lords, may I ask the Minister whether it would not be possible to keep gipsies off the main roads entirely? They are becoming a source of danger with their encampments on main roads. I have been in local government, and I know that we make every provision we can for gipsies. But they still camp on the side of the road, and when they are moved on by the local authorities or the police, they move two or three hundreds yards and camp again.
LORD KENNET: My Lords, this appears to be to be a complicated legal question, and I suggest that the noble Lord should put down an Amendment to achieve that effect, which can be discussed at a later stage of the Bill.
12.52 p.m.
LORD WADE: My Lords, I am grateful to all the noble Lords who have taken part in this debate and for the very constructive manner in which they have contributed to it. I am grateful to the noble Lord, Lord Kennet, for giving his blessing to the Bill on behalf of the Government and, of course, I am grateful for the help which the Government gave in the drafting of it. I am sure that your Lordships will not wish me to speak at length in replying to the debate, but may I make one or two comments?
I think that the noble Lord, Lord Kennet, answered the point made by the noble Lord, Lord Craigmyle, about the jurisdiction of this Bill in Scotland. Perhaps at some future date further thought may be given to the subject of Scotland.
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My noble friend Lord Amulree pointed out the effect of losing the tenancy of a site. It is not just a case of being moved on; it may very often involve the losing of a caravan because one cannot find another site to go to. It may mean a serious financial loss and very real hardship—such cases have occurred. The noble Lord, Lord Milverton, kindly informed us of the view of the A.M.C. and we shall consider carefully what he said, but may I make this point? I appreciate the problem of expense, but, as I understand it, local authorities are involved in considerable expense in removing unauthorised encampments, and if there were permanent sites there might be a saving in the cost of removal from time to time and the clearing up of unauthorised encampments.
My Lords, I was fascinated by the speech of the noble Lord, Lord Willis. I am not sure that his point would be entirely met by using the word "Gipsies" with a capital "G." There is, of course, a distinction between the true Romany and other nomads, but I understand that the Ministry's Report Gipsies and Other Travellers shows that it is impossible to say how many true Romanies there are and which of the nomads are entitled to such a distinction. Over the centuries, there has been a great deal of intermarriage between Romanies and the settled population, so I do not think we could solve the problem by using a capital "G" or using the word "Romany". Furthermore, may I point out that the Gipsy Council has accepted these restrictions on unauthorised camping as the price of their favourable treatment regarding the provision of sites.
The noble Lord, Lord Wakefield of Kendal, made a very helpful contribution and I appreciate his point of view. I think it was largely answered by the noble Lord, Lord Kennet. I will examine any Amendments which the noble Lord puts down, but I must make it clear that I am very anxious to see the Bill reach the Statute Book without delay. The noble Lord, Lord Donaldson of Kings-bridge, Chairman of the Consumer Council—I apologise for calling him the President—made a very helpful contribution. If I erred myself, it was on the side of moderation, but it is much better that comments on the hardships suffered should come from the noble Lord, Lord Donaldson, who speaks with the authority

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of the Consumer Council which made this very valuable study. There is no doubt that hardships are suffered by some occupiers of caravans.
The noble Lord, Lord Mottistone, thought the Bill was excessively biased against the site operator. I beg to differ on that; I think it is drafted as fairly as possible and any good site operator has nothing to worry about. I welcome the encouragement of social responsibility. The noble Lord, Lord Segal, paid a tribute to the police which I welcome. He referred, as did other noble Lords, to the expression, "being a gipsy," but as your Lordships will know, "gipsies" is defined in Clause 16, the Interpretation Clause, as
"persons of nomadic habit of life, whatever their race or origin."
I think that is about as fair a definition as we can get.
My Lords, I will consider the point made by the noble Viscount, Lord Massereene and Ferrard. To the noble Lord, Lord Chorley, may I say that we are grateful to have the support of one so much concerned with the preservation of rural England. I am aware of the association of the noble Lord, Lord Leatherland, with local government. May I just point out that this Bill is based on the precedent of the Protection from Eviction Act 1964 and not on the whole body of Rent Acts. We are aware of the expense to local authorities, but, while that is taken into account in this Bill, I hope that there will not be undue delay in bringing Part II into operation. Once again I thank the noble Lord, Lord Kennet, and to all your Lordships may I say that I hope that, after careful consideration during the Committee stage, we shall be able to get this Bill on to the Statute Book.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

MINISTRY OF HOUSING AND LOCAL GOVERNMENT PROVISIONAL ORDERS (BLACKPOOL AND STOURBRIDGE) BILL
Brought from the Commons; read 1a, and referred to the Examiners.
MINISTRY OF HOUSING AND LOCAL GOVERNMENT PROVISIONAL ORDER (WEST KENT MAIN SEWERAGE DISTRICT) BILL
Brought from the Commons; read 1a, and referred to the Examiners.

FRIENDLY AND INDUSTRIAL AND PROVIDENT SOCIETIES BILL
12.59 p.m.
LORD PEDDIE: My Lords, I beg to move that this Bill be now read a second time. The title does not suggest a glamorous subject, but the Bill is concerned with organisations which for the past century have played a significant part in the life of the British people and made a considerable contribution to the welfare of the community. In normal circumstances I would have moved this Second Reading almost formally, but I am aware of the fact that Members of this House have received communications from interested parties and that the Press has created undue interest in this Bill. It is unnecessary for me to proceed in detail through every clause because the Explanatory Memorandum deals with them with extraordinary clarity. But to my mind the circumstances justify me giving the background of the Bill and its scope and purpose.
Under the Bill, societies covered by the Friendly Societies Act and the Industrial and Provident Societies Act are involved. There are five classes of friendly societies registered under the Friendly Societies Act 1896, and of these the societies normally described as "Friendly Societies" are most important. The principal business is that of insuring the members on a mutual basis for sickness, death and endowment benefits. They include such well-known national organisations as the National Deposit Friendly Society and the

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Hearts of Oak Benefit Society. In addition, there are many small local societies, which have changed very little in character from the sick and burial clubs of the last century. But to-day their combined membership amounts to some 5½ million persons and their funds to some £300 million. In addition to these, there are 81 collecting societies, which are friendly societies undertaking industrial Assurance business. They are subject to the Industrial Assurance Acts as well as the Friendly Societies Act. To give some idea of the size and scope of these organisations, at the end of 1966 they had over 21 million paying policies and funds totalling over £400 million.
The other societies registered under the Friendly Societies Act are workmen's clubs, of which there are some 2,500, with over 1½ million members. In addition, there are specially authorised societies, benevolent societies and, so I am informed, cattle insurance societies. That is the range covered by the Friendly Societies Act. Then there are the societies registered under the Industrial and Provident Societies Act 1965, which was a consolidating Act. It is necessary for a society to be registered if it is, for example, a bona fide co-operative society or an organisation which is conducted for the benefit of the community and for which there are special reasons why it should be registered under this Act rather than under the Companies Act 1948.
The activities of the societies registered under the Industrial and Provident Societies Act are very varied. First of all, there is the great co-operative movement, which undertakes a tremendous trade, exceeding £1,000 million a year. In addition to the Co-operative Wholesale Society, the Scottish Co-operative Wholesale Society and all the local co-operative societies, there are also registered under this Act clubs, housing societies, agricultural societies and a few insurance societies. The largest volume of business is done by the co-operative movement, but at the end of 1966 there were in all 8,145 societies registered under the Industrial and Provident Societies Act, which had a total membership of 15½ million, with funds of over £928 million and assets whose book value was £1,500 million.
The main concern of this Bill is to modernise the law governing the auditing and accounts of friendly societies and
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industrial and provident societies, the range of which I have attempted to describe. The present provisions on these matters are substantially the same as those which were enacted towards the end of last century. It is true that there have been amending Acts over the course of years, but these have merely tinkered with the provisions and now they are out of line with modern accountancy practice and with the corresponding law for companies and building societies. The Bill also brings valuation requirements for friendly societies into line with modern practice and makes some minor administrative improvements in friendly society law.
In the matter of audit and accounts, the changes proposed fall under two heads: the changes in accounting requirements for societies and the changes in the qualifications, rights and duties of auditors. Under the first head, the substance of the change is that accounts and balance sheets in future will be required to give a "true and fair view" of matters with which they deal and auditors are required to report accordingly. The "true and fair view", as it is described, is now the accepted criterion for accounts and balance sheets and is written into the Companies Act and Building Societies Act. Under present law, auditors of friendly, industrial and provident societies have to report whether accounts are "correct, duly vouched and in accordance with law", and modern accountants regard a report in these terms as too restrictive in scope. Therefore the appropriate accounts of friendly societies and cooperative societies should be brought into line with new accountancy concepts.
I would point out to your Lordships that save in one instance the Bill will not oblige any society to publish accounts additional to those required by the present law. The exception is in Clause 13, which provides for an industrial and provident society which has a subsidiary to produce group accounts covering the affairs of the group as a whole. Clause 14(2) provides that group accounts need not deal with a subsidiary if, in the opinion of the parent organisation, and this is approved by the registrar, the inclusion of the subsidiary's accounts would be impracticable or misleading, or the two businesses could not reasonably be treated as a single undertaking.

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Clause 15(5) defines a subsidiary of an industrial and provident society. It states:
"For the purposes of this Act, an industrial and provident society shall be deemed to be a subsidiary of another such society if, but only if, that other society either—

(a) is a member of the first mentioned society and controls the composition of its committee;…"

That is a most important matter which I would ask your Lordships to bear in mind. Under the second head, qualifications of auditors, the Bill discards the obsolete system of approved auditors who are specially appointed by the Treasury. This system also is a relic of the 19th century. Instead, it provides for the audits (all save those of the smallest societies) to be conducted by accountants with recognised professional qualifications. It is true that under the Bill the smallest societies will be allowed to have the option to appoint lay auditors, and as a transitional measure existing approved auditors will be allowed to continue with the audits which they already perform. But, apart from these exceptions, the sole qualification for a society's auditor will be in future recognised as professional qualifications as set out in Clause 7.
I would point out in passing that the Bill protects professional auditors from summary dismissal, and they can be removed only by resolutions at general meetings. In this as in other matters, the Bill is adopting the standards already accepted by the Companies Acts and the Building Societies' Act. I would at this point take the opportunity of laying special emphasis on one extremely important point: it must be made clear that the proposals in this Bill have not been prompted by the need to check abuses made possible by existing law. The law certainly needs to be modernised, but there is not the slightest evidence that these defects have led to misconduct of the affairs of societies. Indeed, the conduct of these societies, so numerous in terms of numbers of societies and so powerful in terms of the support they receive from the general public, has been of the highest order. I made reference in opening this speech to the tremendous contribution they have made to social welfare. Indeed, because that fact is recognised the penalties imposed for the
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contravention of the provisions of this Bill are the standard penalties for offences under the Acts of 1896 and 1965.
I should also bring to the notice of your Lordships, particularly in view of the recent Press comment, the fact that the proposals embodied in this Bill have been fully discussed over the past three years, not only with accountancy bodies but with the principal organisations representing both friendly societies and industrial and provident societies. I would also take this opportunity of emphasising that nothing in this Bill affects the nature or constitution of societies or alters the general framework of the law under which they conduct their business; nor does it add to, or alter, the existing relationships between societies. That I think is of tremendous importance. What the Bill does, both by implication and in fact, is to acknowledge the continuing importance of the role of these voluntary organisations in the community. The principle of the Bill, therefore, is, quite simply, that their accounting standards should correspond to the importance of their role in the community. I commend the Bill to your Lordships.
Moved, That the Bill be now read 2a. (Lord Peddie.)
1.14 p.m.
LORD DRUMALBYN: My Lords, we are extremely grateful to the noble Lord, Lord Peddie, for the way in which he has dealt with the provisions of this Bill in introducing it to your Lordships' House. The Bill seems to be fated to have a rather peculiar history. It was debated, more by chance than intention, on Second Reading in another place. Indeed, so unexpected was the debate that the sponsor of the Bill had not taken the precaution to be present; he thought, I imagine, that it would go on the nod. However, he made up for it in Committee by getting 38 Amendments through in 24 minutes, which is not bad going.
It is impossible to disagree with the purposes of the Bill. The noble Lord, Lord Peddie, has made these very clear. He has made clear, also—and I entirely agree with him—that there is no evidence that this Bill is required by reason of any abuses. The purpose of the Bill is not to prevent abuses but merely, as the noble Lord says, to modernise the

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accounting systems and to bring some uniformity into them, which is clearly desirable.
I have only one point to raise, and it is a difficult one. It comes to me from a letter, accompanied by a memorandum, which was sent to my noble friend Lord Erroll of Hale, and I believe has been sent to other Members of your Lordship's House, by the Co-operative Insurance Society Limited, asking for an Amendment to be made to the Bill. My noble friend passed this on to me as he was unable to be present to-day, and, having read it, I asked the officers or the Society to meet me, which they did yesterday. The memorandum deals with the effect on their interests of that part of the Bill which deals with the group accounts of industrial and provident societies.
I think I should tell your Lordships what is contained in the memorandum. If I may summarise it as briefly as I can, the society says that its assets amount to over £450 million. Its paid up share capital, however, is only £52,500, which is owned as to four-fifths by the Co-operative Wholesale Society and one-fifth by the Scottish Co-operative Wholesale Society, and on which a maximum dividend of 7 per cent. a year is paid. The remainder of the assets are, in effect, held in trust for the policyholders, and the whole of the profits, now amounting to over £16½ million a year, must, the memorandum says, be used for their benefit. In short, if I may put it in this way, while the Co-operative Wholesale Society and the Scottish Cooperative Wholesale Society jointly own the business, they do not own the assets, in the sense that the assets are not in any way at the disposal of the Cooperative Wholesale Society or the Scottish Co-operative Wholesale Society to meet their liabilities.
The memorandum argues, therefore, that it would be quite wrong if the accounts of the Co-operative Insurance Society were to be consolidated with those of the Co-operative Wholesale Society or, indeed, included in the group accounts, even although it is a fact that the directors are all appointed by these two Societies. There are ten directors, and eight are appointed by the Wholesale Co-operative Society and two by the Scottish Wholesale Co-operative Society.
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This, I believe, is common ground between the Co-operative Wholesale Society and (if I may now abbreviate) the C.I.S. In terms of the Bill, it seems probable that the Co-operative Wholesale Society would avail itself of Clause 14(2) and apply to the Chief Registrar for authority, or for his agreement, at any rate, not to deal with the Co-operative Insurance Society in its group accounts. But this, it is thought by the C.I.S., would involve referring to the C.I.S. as a subsidiary and giving an explanation in the group accounts as to why the accounts are not included.
In fact, I understand that the C.W.S. take some pride in the fact that last year they brought the presentation of their group accounts into line with the provisions of the Bill in advance of legislation. The noble Lord mentioned that the provisions of this Bill had been discussed for some three years past, and I think it is much to the credit of the C.W.S. that they have done so. I understand also that they referred to the C.I.S. in their group accounts for the year—that is, the year before this current year. The C.I.S. say that this has already caused them some embarrassment and they fear that the interests of their policyholders and of their business might be ad tersely affected by this Bill, because of the impression that might be created—quite wrongly, of course, but impressions are impressions—that the assets of the C.I.S. are available to the C.W.S. I thing there may be other reasons which one need not, obviously, go into.
This seems to me to be a matter which could be very easily put right by a small Amendment to Clause 15(5), which deals with the circumstances in which an industrial and provident society is to be deemed to be a subsidiary of another society. It would be quite easy, I should have thought, to exclude the C.I.S., either by name or as a member of a class—a class in which it might well be that it is the only member; I do not know. I hope that the noble Lord will be able to say that he will certainly consider such an Amendment, since the object is to safeguard the interests of the policyholders and to ensure that such a wrong impression is not conveyed about the position of the assets and profits of the society in relation to the C.W.S.

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This was the view expressed in the letter and the memorandum sent to Members of your Lordships' House, and matters would have been quite easy had they been allowed to rest here. Unfortunately, that is not so, and to-day an article appears in the Business News section of The Times, which I must read to your Lordships. The article is headed, "Chairman Goes in Co-op Row", and it says:
"The battle for control of the £477 m. Cooperative Insurance Society has led to the withdrawal from the board of the chairman, Mr. A. E. F. Lovick, and three other directors. An announcement of a boardroom reshuffle is expected in the next few days.
"These changes follow a last-minute bid by the traditionally independent 100-year-old insurance organisation to alter Government-backed legislation establishing full control by the £500 m. Co-op Wholesale Society."
I may interpose here to say that I take note of what the noble Lord, Lord Peddie, said, that this does not alter in my way the constitution of any of the industrial and provident societies covered by the Bill.
I continue the quotation:
"Trouble has flared because the C.W.S. opposes the attempt to break away from the proposed subsidiary status.
"The complex row between the two sister Co-ops involves the insurance board's determined stand that its first responsibility is to the millions of policyholders paying about £90 million a year in premiums. There are fears that the C.W.S.—principal shareholder which waives any claim to the £15 m. profits (all returned to policyholders)—may interfere with the investment of £400 m. worth of funds to help the general Co-op modernization drive."
And then these are the words which are important, I think, to your Lordships:
"Departure of the chairman and three colleagues—they are all full-time C.W.S. directors—follows the circulation to all members of the House of Lords of a memorandum setting out the insurance board's objections to part of the Industrial and Provident Societies Bill now going through Parliament.
"A majority of the C.W.S. board, which nominates eight of the insurance society's board from its own ranks, claims this move was in defiance of the wishes of the principal shareholders. As a result, the resignation of the chairman and three others has been demanded and the C.W.S. board is nominating replacements, including its own chairman, Harry Jennings, drawn from the ranks of part-time wholesale directors."
My Lords, the approach to Members of this House with a view to securing an
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Amendment to the Bill may not have been, of course, the full cause of this dismissal; it may be only an approximate cause. Nevertheless, I am concerned that the right of an insurance board representing so substantial a business, and therefore presumably an experienced and responsible body, to approach your Lordships on what it conceives to be the interests of its policyholders should have been interfered with in this way and punitive action taken by the owners of the share capital, whoever they may be. At the least, I feel that it is necessary that the action taken should be investigated by your Lordships, and I am accordingly putting down this afternoon a Motion to refer this matter to the Committee for Privileges.
1.27 p.m.
LORD HIRSHFIELD: My Lords, the noble Lord, Lord Drumalbyn, has referred to an article in the Press this morning. I will refer at the outset of what I am going to say to a broadcast last night by the noble Lord, Lord Carrington, who leads the Benches opposite. I understand that in that broadcast he said that some Life Peers speak too often, and for too long, and on subjects outside their experience. If that represents the noble Lord's view, might I emphasise for his reflection, and for others who think as he does, that some Peers of other rank or kind who seldom appear in your Lordships' House tend to crowd in at the wrong times, and vote without sufficient self-discipline and thought when they do, and, as we can see, delay the Business of Government and the country much more than do some Life Peers who occasionally, but with sincerity, speak for some minutes longer than they need?
But if in the minds of the noble Lord, Lord Carrington, and some of his friends I am among the offenders who are Life Peers, let me say with all the emphasis at my command that I came to your Lordships' House to do a job, and I intend to do it. Moreover, I happen to be an accountant and compared with, say, lawyers and teachers, we are perhaps all too few in your Lordships' House and the other place. But there is the point that accountants are often accused of interfering too much in too many things. That, I suppose, flows from the fact of the training

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and experience they have. History indicates that accountants in fact play a vital role in industry and in economic affairs.
Possibly in this short Second Reading debate on the Friendly and Industrial and Provident Societies Bill I am the only approved auditor present, and possibly the only approved auditor in your Lordships' House altogether. I am about to lose my job in consequence of this Bill, but fortunately I shall still qualify under the other headings of the Bill to continue. But, beyond that, I think I also happen to be the person who audits the annual accounts of Britain's largest friendly society. I would not have mentioned its name, but as other names were mentioned by my noble friend Lord Peddie I will tell your Lordships that that society is the Industrial Orthopaedic Society which governs the Manor House Hospital. So for many years I have been connected with the accounts of societies for which this Bill caters, and it would hardly be correct for me to stay completely silent, in spite of the fact that I occupied some of your Lordships' time earlier this week.
Substantially, I believe this Bill emanated from the representations initiated by my professional institute and, according to my information, at a later stage there were talks between the Registrar of Friendly Societies and members of the Accountants' Joint Parliamentary Committee. Points were put, they were discussed and were answered by the Registrar and his colleagues, and the Bill now before your Lordships' House is said to be widely supported—and is indeed supported—by the professional accounting bodies. It is a much overdue piece of legislation which ought to be generally welcomed. For some time I have believed that some of the accounting and auditing requirements pertaining to these societies have been quite archaic, and even the printed form prescribed by the Registrar, which is the annual return and statement of accounts to be filed by these societies, has needed modernisation, in line with new thinking and techniques. One form I saw recently had a new space upon it worded to indicate the amount of capital losses. However, there was no space for capital profits. I hope that my efforts in the area of investment will see a rapid change from what somebody seems to think must be the inevitable result of all society investment policy.
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I have a few other personal observations to make on this Bill. In one respect there is an improvement even upon the provisions applicable to companies. In Clause 1(1)(b) every society is required to maintain—and I emphasise this—a satisfactory system of control over its books of account, its cash holdings and all its receipts and remittances; and in Clause 9(4)(b) the auditors are required to satisfy themselves about this and to report if it is not complied with. So here we have this new area covering these societies on the subject of control, which is not so far covered even in the company legislation.
It seems to me the sequence in Clause 3 is not quite as I would have expected to see it. For example, subsection (1) of that clause says:
"Every revenue account of a society shall give a true and fair view…for the period to which the account relates."
Then in subsection (2) it says:
"Every society shall, in respect of each year of account, cause to be prepared either—"
a revenue account or two or more revenue accounts. Obviously one must prepare a revenue account first before one comes to the notion of whether or not it gives a true and fair view. I hope that in the later stages of the Bill we shall see the order of these two subsections reversed.
In Clauses 7 and 8 reference is made to the qualification of auditors. I wonder why, for example, in Clause 7 it is not provided that a firm may be appointed auditors provided that none of its partners is ineligible? Apparently this can be done under Clause 8 in the case of a Scottish firm, and whether this is the result of drafting by a Scottish lawyer, or an overdose of Scottish nationalism, I cannot say. I urge the powers that be to look at that particular part again, for I know from personal experience how important it is that a firm should be able to certify, provided all the partners in the firm are eligible. If this can be done in Scotland, surely it can also be done in England and Wales.
Clause 9 refers to the auditor's report, and that prompts me to raise this point. Should not the auditors be required also to satisfy themselves that the accounts are in conformity with the rules of the particular society as well as with the

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books and accounts? The same clause gives auditors access to books, and clearly includes minute books, so would it not be helpful to include a specific reference to minute books, because there are many cases where auditors have considerable difficulty in obtaining access to minute books. The auditor can certainly verify entries in the books of account by seeing their authorisation in the minutes; but he should also be able to check that transactions authorised by the minutes have in fact been carried out. This ties in with what I have said about conformity with the rule book. Any authorised transaction not carried out could then be reported on by the auditor.
Clause 1(1)(b) requires a society to maintain a satisfactory system of control of its books of account, its cash holdings and all its receipts and remittances. But what about its other assets? After all, we are talking here about large societies as well as small ones. What about its investments, properties, stores, debts and so on? I can tell your Lordships from experience, that in many cases these are material, and here we are only talking about a satisfactory system of control of books of account, its cash holdings and all its receipts and remittances. The other assets are not referred to.
I notice that there seems to be no requirement for the annual accounts to be laid before, or accepted by, the members at an annual meeting. The only right of a member is to demand a copy of the last annual return, which must incorporate a copy of the accounts. This, in practice, may be dealt with in a particular society's rules, but certainly so far as industrial and provident societies are concerned it is not one of the matters which must be provided for in the society's rules. I understand this was a specific point taken up with the Registrar, and his Department indicated that the reason for this omission was on grounds of cost. There were so many small societies round the country that to call meetings with the cost of paper, postage and the reproduction of the accounts would be too burdensome for them. If that is the explanation I can understand it, and I will accept the wording as it stands.
VISCOUNT GOSCHEN: My Lords, before the noble Lord sits down may I
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make this point. He referred to the broadcast made by my noble friend Lord Carrington, when he was asked what he thought about Life Peers. I will not use my noble friend's own words because I cannot remember them accurately, but he welcomed Life Peers most strongly and considered that their introduction had brought about a great improvement in this House.
1.40 p.m.
LORD BOWLES: My Lords, this Bill has a very simple aim. It sets out to modernise the law governing accounts and audit of friendly societies and industrial and provident societies, and to bring it into line with modern accountancy practice. The Bill also revises the law governing friendly society valuations—again an exercise in modernisation. The present law on all these matters is of late nineteenth century vintage. It has its origin in an age when the great majority of these societies were small local concerns, lacking officers with any special experience of accounts, and accustomed in many cases to have their audits conducted (as the law then allowed) by laymen with no professional training for the job. Amending Acts passed in this century have obliged industrial and provident societies and the larger friendly societies to employ professional auditors chosen from a list of auditors specially approved by the Treasury; but apart from this change—which is itself now outmoded—there has been no general overhaul of the nineteenth century provisions governing accounts and audit. This overhaul is what the present Bill sets out to do.
As my noble friend Lord Peddie and others who have spoken before me have covered a good deal, if not all, of the provisions of the Bill, I can reduce to some extent what I was going to say. This Bill has the Government's full support. Its provisions have evolved from a series of discussions held over the last three years between the Chief Registrar of Friendly Societies, the professional accountancy bodies, and all the leading organisations representing the societies. We believe that there is general acceptance by all concerned of the principles of the Bill, and that it contains nothing to which any of them could reasonably take exception.

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I would stress the consensus of opinion behind this Bill. It is in no sense a restrictive or punitive measure, designed to check abuses or bring recalcitrants to heel as my noble friend said. It does not interefere with the way in which these societies conduct their business, still less with their internal structure or with their relationships with their members or with each other. It provides simply for that business to be accounted for and audited, and in the case of friendly societies to be valued, in accordance with standards appropriate to the present day. Legislation for these societies has become a comparatively rare event in this century. If one looks through the Statute Books of the last century one finds that some Act relating to friendly societies or co-operative societies passed through Parliament, on an average, every three or four years. No doubt the main reason for the change is the growth and complexity of other Parliamentary business; but some credit for it may fairly be given to the ability the societies have shown to conduct their affairs within the framework of the law and without the need for frequent reviews by Parliament. In recognising the need for this Bill we are also recognising that the part played by these voluntary associations in our community remains of sufficient importance to call for the highest accounting standards. With those words, my Lords, I would say that the Government gives its blessing to this Bill.
1.43 p.m.
LORD PEDDIE: My Lords, I thank noble Lords for their contributions to this debate and their support for the Bill, which in the opinion of all who have spoken makes its contribution towards the modernisation of the law relating to the accounting and auditing of these Societies. I was sorry that the noble Lord, Lord Drumalbyn, gave additional publicity to statements which have appeared in the Press but which he himself indicated to the House he did not accept. We all, during the course of our time in this House get used to misinterpretation, if not misrepresentation.
I made it quite clear—and the noble Lord, Lord Drumalbyn, accepted my assurance—that this Bill does not in any way affect the nature or constitution of societies; nor does it alter the general
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framework of the law under which they conduct their business. So it involves no change at all in the relationship between the C.W.S. and the Co-operative Insurance Society. Under the terms of this Bill, which Lord Drumalbyn accepts, it is clear that because the C.W.S. have the right to determine the composit.on of a committee of the C.I.S. then under the terms of this Bill the C.I.S. is a subsidiary. But there is no intention, there never has been and never will be, on the part of the C.W.S., even if they had such power, to effect any control ever the funds of the C.I.S. Therefore it is indeed most unfortunate, when we consider the long record of public service of the C.I.S. and the C.W.S., to hear further publicity given to inaccurate statements indicated in the Press to-day that it is feared that the C.W.S. may interfere with the investment of 400 million of funds to help the general Co-operative modernisation drive. The noble Lord, Lord Drumalbyn said he does not accept those statements, and, as I say, I regret that the matter has been given this prominence, and furthermore that it will be "blown up" in such a manner, by a Motion in this House, as to make it a matter of privilege. I have the greatest possible respect—and I say this most sincerely—for the standing, integrity and judgment of the noble Lord, Lord Drumalbyn, and therefore I am sorry he has misguidedly felt this matter is of such importance.
It has been made quite clear that the assets and funds of the C.I.S. will be used solely and wholly in the future, as in the past, for the benefit of the policy holders; and that remains as it ever was. There is nothing in this Bill, there is nothing in the aspirations of the C.W.S. in any way to affect that. And I take this opportunity of making quite clear that there is no intention whatsoever of interfering with the C.I.S. to the detriment of the policy holders. But the fact remains that, by the very constitution of the and the relationship between the and the C.W.S. the Board of the C.W.S. has the right of appointment of the directors of the C.I.S.
LORD DRUMALBYN: My Lords, I hesitate to interrupt the noble Lord—he is very good to give way. As I have said, this matter is going to be referred to by the putting down of a Motion. I

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am in the hands of your Lordships, but I should have thought it undesirable that we should debate the particular issue here. So far the noble Lord has not entrenched on the issue at all, and I hope he will not do so. But I thought it best to rise and suggest that it would be undesirable to debate the actual issue of the reference.
LORD PEDDIE: My Lords, I accept that. I have no such intention. My comments to-day are upon the relationship of the C.W.S. and the C.I.S. I feel justified in referring to this matter because it has a bearing upon what we are discussing on this Second Reading; and it further reinforces the point I made about the fact that there has been no change in the character of the Societies under this Bill. I make no further comment on that except once again to give a complete assurance that there is nothing in the Bill, nothing in the intentions of the C.W.S., to get any undue control of the C.I.S. funds.
That is all I need to say, except once again to thank the noble Lord, Lord Drumalbyn, for his support of the general principle of the Bill. I also thank my noble friend Lord Hirshfield, who has considerable experience in this field and has himself functioned as an approved auditor. I am sorry he is going to lose his job, though he did not seem to have any regret about that. The various points that he made were very largely drafting points, and I have taken note of them. I thought at first that he had picked up my copy of the Bill, which made it difficult to follow but I was not justified in that criticism. His comments will be noted. I also thank my noble friend Lord Bowles for his support.
My Lords, may I say, in conclusion, that I am sorry this debate has given rise to comments of such a nature. I regret that certain unfortunate aspects have been introduced. Nevertheless, I appreciate the obvious welcome which this House has given to the Bill itself, and I sincerely hope that it will have a swift and easy passage through this House.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

PONIES BILL [H.L.]
1.50 p.m.
LORD SILKIN: My Lords, I beg to move that this Bill be now a read a third time.
Moved, That the Bill be now read 3a.—(Lord Silkin.)
THE MARQUESS OF WILLINGDON: My Lords, in declaring an interest as President of the Fauna Preservation Society and a Vice-President of the National Pony Society and the Ponies of Britain, I do not think this occasion should pass without someone, on behalf of many of us—I think all the equestrian Press and particularly those wretched scrub ponies who cannot speak for themselves—thanking Lord Silkin most sincerely for the tremendous trouble that he has taken to present this most necessary Bill. When I asked him if he would take it after it was "talked out" in another place—Heaven only knows why! —I never realised what a colossal interest and tremendous labour he would undertake. Therefore, I once more express our appreciation to him.
Secondly, I hope that this Bill will go forward. I cannot believe that it helps our export trade in any way if these "men from the mountains of the moon" descend and remove these wretched ponies straight off their mother's breast into lorries, shifting them round from sale to sale and finally, if they are unsold, shipping them all the way, let us say from Wales to Yarmouth, on to a ship for foreign parts. No-one in his senses can tell me that a yearling colt of unknown breeding is bought in Europe for the purpose of making a riding poney at the age of five. I beg to support this Bill, and to thank Lord Silkin most sincerely.
LORD SILKIN: My Lords, it would be most ungracious if I did not, in a few words, express my appreciation and thanks to the noble Marquess for the help and encouragement that he has given me throughout the passage of this Bill. Unfortunately, it is not such a popular a Bill as I should have anticipated in this House, but it is of satisfaction to me that it has at last reached the Third Reading.
On Question, Bill read 3a.
Clause 2 [Provisions for exporting ponies]:
LORD SILKIN: My Lords, I beg to move the Amendment standing in my name. It is quite a simple Amendment and is intended to put right an omission on my part. As the Bill stands at present, the transport of ponies from the United Kingdom to the Isle of Man has to be regulated, because I had mistakenly assumed that the Isle of Man was a part of the United Kingdom. I find that, technically, it is not. Therefore, these words are being moved to put that matter right. I beg to move.
Amendment moved—
Page 2, line 5, after ("Britain") insert ("and the Isle of Man").—(Lord Silkin.)
LORD BESWICK: My Lords, I will just say briefly that I will not oppose this Amendment because I propose to say something about this Bill on the next stage. I should say, however, that if adopted it would create on absurd situation. The noble Lord at an earlier stage took out the Channel Islands, Northern Ireland and the Isle of Man, and now to reintroduce the Isle of Man would, I respectfully put to him, be somewhat anomalous.
LORD SILKIN: My Lords, I considered that, and I think that the passage of ponies from the United Kingdom to the Channel Islands should necessitate a rest period for them because it is a rather long journey. As regards Southern Ireland, I had a great many representations that they should be excluded, and I have therefore excluded them.
On Question, Amendment agreed to.
1.56 p.m.
LORD SILKIN: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.— (Lord Silkin.)
LORD BESWICK: My Lords, at an earlier stage of this Bill my noble friend Lord Hilton of Upton on behalf of the Government said that it might be necessary to advise your Lordships to vote against this Bill on Third Reading or at this stage. I want to state, briefly, although it has been said before, why Her Majesty's Government feel it better that this Bill did not make further progress. Underlying Clause 1 of the Bill
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is an assumption that a trade exists in the export of British ponies for the prime purpose of slaughter. We have no evidence to support this assumption The noble Lord, Lord Silkin, himself has ad! mitted that the existence of the trade is based on inference and fear rather than facts. But even if the trade did exist Her Majesty's Government do not believe that this would be the legislation best designed to stop it. It would, for example, prevent much of the export trade in ponies for breeding and riding. It would also draw an illogical distinction between the slaughter of ponies and the slaughter of other animals for human consumption. It would place upon veterinary inspectors a responsibility for assessing pony values which would be difficult to discharge, even for an experienced horse-dealer, let alone a veterinary inspector.
As regards the compulsory rest period required by Clause 2, we already have powers under the Diseases of Animals Act 1950 to make an Order. We do not believe that the welfare of exported ponies is prejudiced by the absence of a compulsory rest period, but I repeat the undertaking already given to my noble friend that if the Bill is withdrawn we should be prepared to reconsider, in the light of comments from interested organisations and individuals, whether a compulsory rest period is necessary in addition to our existing safeguards As for Clause 3, we believe that to be unnecessary. Despite allegations to the contrary, existing veterinary inspection for fitness to travel, is already honestly and effectively discharged by the State Veterinary Service and will reject panies which for any reason cannot travel without unnecessary suffering.
My Lords, after the Second Reading my right honourable friend Mr. Peart, then Minister of Agriculture, saw the noble Lord, Lord Silkin, and discussed in great detail the objectives of this Bill. He wrote to him on the 29th March restating the objections to the legislation proposed but giving assurances about the seriousness which we attach to animal welfare problems. The Minister emphasised that if my noble friend felt it possible to accept the assurances and withdraw the Bill, he would propose bringing the features of the Bill specifically to the notice of the Department's

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veterinary inspectors. My understanding is that the noble Lord, Lord Silkin, never replied to this letter but nevertheless put the Bill down for further consideration on Committee stage.
On Report stage my noble friend made some rather critical comments about the non-co-operation of the Government and the Government spokesman on that occasion. I am bound to say to him that when he was making this criticism of non-co-operation I thought of the fact that that letter still, so far as I am concerned, remains unanswered. I therefore again invite my noble friend to consider the advisability of withdrawing the Bill. I do not, for obvious reasons, suggest dividing the House against it this afternoon, but, clearly, it would not be possible to support any further progress to the Statute Book.
2.0 p.m.
LORD SILKIN: My Lords, that comes as a complete surprise to me. I had not anticipated the noble Lord was going to make an attack on the Bill at this stage. I know that the noble Lord, Lord Hilton of Upton, said something on Report stage, but I subsequently had a talk with him and he promised me that if anything of this kind was going to take place, if there was to be an attack on the Bill, I should be forewarned. I spoke to him as recently as yesterday and he gave no indication whatever that there was going to be any attack on this Bill.
I am not going to reply in detail, since the noble Lord, Lord Beswick, does not propose to divide the House, but I should just like to say one or two things. First, this Bill is strongly supported by every single pony protection society in the country—and there are quite a number of them. It is also strongly supported by the Royal Society for the Prevention of Cruelty to Animals. I have had a great deal of help from all these organisations. It is largely at their instance that this Bill has been promoted. Secondly, the particular provision as regards a rest period cannot be dealt with under the Diseases of Animals Act. I have been through the Act. There are certain sections of it which enable rules to be made, but there is nothing which would enable these rules to be made under that Act.
LORD BESWICK: My Lords, may I, as a matter of interest, just ask my noble friend if that is his view why he did not respond to my right honourable friend's invitation to discuss the possibility of a further Order under that Act?
LORD SILKIN: My Lords, I did have a talk with Mr. Peart and his officers, and I told him that I was prepared to withdraw the Bill if he would undertake to introduce subsidiary regulations under the Diseases of Animals Act; and, indeed, that I should be prepared to compromise to the fullest extent. He was not prepared to do so, and I told him that if he was not prepared to do so, I should proceed with the Bill. I did not see that that letter required any answer, since it contained no special offer.
I am sorry to be at variance with the Government. I do not agree with them that this Bill is not necessary. In my view, it is very necessary; and, as I have said, all the organisations concerned with the welfare of ponies strongly think so. As regards animals going for slaughter, there is of course a school of thought which takes the view that there is nothing very wrong with young ponies being exported for slaughter; and those who take that view, of course, would not be supporters of this Bill. But the fact is that there is something abhorrent to people in this country, who have a special love for horses and dogs, in the idea of our deliberately sending ponies for slaughter.
I said that I could not give specific proof, but the inference is very strong (and it is drawn by all the protection societies) that many of these ponies, which are not suited to any other purpose—for instance breeding, riding or exhibition—could not possibly be exported except for the purpose of slaughter. Since the Bill was introduced I have had some evidence, some direct evidence that that is the case. At this late stage of the Session I recognise that there is little chance of this Bill getting a hearing in another place, but I would ask the House to let this Bill pass with the intention on my part of reintroducing it early next Session and then possibly ensuring that it goes further in another place.
On Question, Bill passed, and sent to the Commons.

FAMILY ALLOWANCES AND NATIONAL INSURANCE (No. 2) BILL
2.5 p.m.
LORD BOWLES: My Lords, I beg to move that this Bill be now read a second time. It gives me very great pleasure to introduce this Bill to your Lordships' House. It is the second such Bill in just over six months that it has been my happy duty to introduce. It is a very short and simple Bill. Noble Lords will recognise it as being somewhat shorter than when it first saw the light of day in another place, and they may well feel that this is no bad thing.
The main function of the Bill is to give legislative form to the announcement by my right honourable friend the Chancellor of the Exchequer in his Budget statement in another place that family allowances are to be increased by 3s. a week. This increase is provided for in subsection (1) of Clause 1. The rates at present are 15s. a week for the second child in the family and 17s. for the third and each subsequent child. When the Bill comes into effect these rates will thus be 18s. and 20s. respectively. We intend these rates to operate from the 8th October.
There are two prime reasons for this increase. For the background to the first, I need not go back further than last November and the devaluation of the pound. It was made quite clear by my right honourable friend the Prime Minister at the time that the most vulnerable classes of the community would be protected from the consequences of devaluation. On a subsequent occasion my right honourable friend the Minister of Social Security explained whom the Government saw as the most vulnerable. She identified two groups: first, those with slender resources who are old or sick; and secondly, those families which have to support their children on very small incomes.
My right honourable friend the Prime Minister announced in his statement on public expenditure in January that the Government propose to increase supplementary benefits in the coming autumn. My right honourable friend the Minister of Social Security informed the House of Commons in a Written Answer on January 17 (col. 97) that she would lay
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draft regulations the next day, June 18, to come into operation on October 7 this year. The present Bill fulfils the commitment to look after the second group, that is, families who have to support their children on very low incomes.
My Lords, this is the first reason for the 3s. increase in family allowances proposed in this Bill. The second reason was given by my right honourable friend the Chancellor of the Exchequer in his Budget statement on March 19. He described the essential need of the country for a firm and effective incomes policy if we are to overcome the economic difficulties that have beset us for so long; and he announced that the main feature of this policy, lasting at least until the end of next year, would be a ceiling of 3½ per cent. on increases in incomes. He recognised, however, that a strict 3½ per cent. ceiling on wage increases would bear hard on families of small means; and he announced the proposed increase in family allowances to mitigate the consequences of this. The increase has, therefore, a dual purpose. It protects families with very low incomes from the consequences of devaluation, in accordance with the Government's promise, and it helps to mitigate the effect on these families of the wage ceiling which the Government see as essential if our incomes policy is to be a success and we are to see our way clear to a balance of payments surplus in due course.
I turn now to a question which occupied your Lordships' House about three months ago on a debate initiated by the noble Lord, Lord Byers—the question of selectivity. Selectivity is the fashionable word in welfare nowadays and, as I think the debate showed, it can mean a number of different things depending on how one looks at the subject. We had a good debate, with a number of stimulating speeches, and I think it performed a very valuable function in clarifying some of the practical issues which the subject necessarily raises.
Your Lordships will be aware that family allowances were increased by 7s. last April, only two months ago, under the Family Allowances and National Insurance Act 1967. Last January, before the new increase had been announced, my right honourable friend the Prime Minister announced it was essential that the 7s. increase should be selective and should be confined to those

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most in need. When my right honourable friend the Chanceller of the Exchequer in his Budget statement announced the further 3s. increase, he said that this increase would be selective, too, and he described how he was going to achieve this selectivity for both the 7s. and the proposed 3s. In our debate last March, which took place the day after the Budget, I was able to give your Lordships a brief statement about this. Now that the Finance Bill is shortly to be discussed by your Lordships, I can amplify a little what I said then.
The aim is to concentrate the two family allowance increases on the worst off and to ensure that the family with the breadwinner paying income tax at the standard rate derives no benefit from them. This is achieved by reducing the family's tax allowances in 1968–69 by £36 for each child who ranks for family allowance for the full year. The result for the standard-rate taxpayer is that he will pay about 8s. 6d. a week extra tax over the year as a whole to offset the two increases—the extra 7s. family allowance payable from April to the beginning of October and a further 3s., making a total increase of 10s. payable under the present Bill from October to April. His family will thus be left in virtually the same position as before—no better off and no worse off. The family paying tax at one or other of the reduced rates of tax gets more in extra family allowances than it has to pay in extra tax. The family paying no tax gets the benefit of the full 7s. and 3s.
My Lords, in the Government's view, this is a fair, reasonable and socially acceptable way of making sure that help goes only to those who need it. It uses the built-in incomes test of the income tax system and avoids the necessity for a direct means test of any kind. I need not labour the disadvantages of introducing a means test in the sphere of social security they have been made clear often enough. Suffice to remind your Lordships how cumbrous and expensive a means test would be, compared with the simplicity of the Government's proposals; and how, with a means test, there are always some people who never apply. So one gets help to less than 100 per cent. of the people whom one wants to help.
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An example or two will show how the Government's give-and-take scheme, as it is colloquially known, will work. The effect of this will vary with the size of the family. Let me take a married man with two children, both under the age of 11. If he earns £12 a week, he pays no tax this year and gets an extra family allowances of just over £22; that is to say, 7s. a week for the first half of the year and 10s. for the second half, averaging 8s. 6d. a week over the year as a whole. If he earns £15 a week he pays extra tax for the year of about £11. That is about half the extra family allowances, so that the family is about 4s. 3d. a week better off. If he earns £20 a week, the family will be about 2s. a week better off. If he earns £22 a week, the family derives no benefit from the extra family allowances.
LORD DRUMALBYN: My Lords, if I may interrupt the noble Lord for one moment, is he referring to a family with three children?
LORD BOWLES: Three children, in the sense that two are getting family allowances. I think that is right. But I may have made a mistake, and if so I will let the noble Lord know.
The more children a man has, the higher these figures will be. The reduction in the family's tax allowance means that these families pay more tax than they would otherwise do and that those who previously paid no tax will be doing so for the first time. But they have the extra family allowances which balance, or more than balance, the extra tax they have to pay. We expect that some 300,000 people will be, as the phrase goes, brought into tax for the first time. But their families will be better off at the end of the day. The amount of tax will be small, and it will be well out-balanced by the additional family allowances. Of the 4 million families who qualify for family allowances, just over 2 million will derive a net benefit from the combined family allowance and tax changes which I have just described.
I must now deal briefly with the rest of the Bill. The remainder of Clause 1 and Schedules 1 and 2 deal with national insurance and industrial injuries dependency benefit for children. Because family allowances are being increased by 3s., these benefits are being reduced by

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a corresponding amount, leaving unchanged the total amount payable by way of benefit and family allownces for each child. For a man on sickness benefit or unemployment benefit this total is 28s. At present the first child qualifies for benefit of 28s., because he does not qualify for family allowance. The second child qualifies for 13s. benefit and 15s. family allowance, making 28s. in all. The Bill reduces the 13s. benefit to 10s. because the 15s. family allowance is increased to 18s. The third child at present qualifies for 11s. benefit and 17s. family allowance. The Bill reduces the 11s. to 8s. because the 17s. family allowance is increased to 20s. Similar reductions are made in widows' benefits for second and subsequent children, for whom the total of benefit and family allowance will be 45s. 6d. as it is at present.
These adjustments reflect the complementary nature of family allowances and dependency benefit for children which has been part of the National Insurance Scheme from the very beginning. These dependency benefits can best be regarded as balancing payments which with family allowances bring the total payable for each child up to the appropriate standard. Because family allowances are being increased it follows that the amount of dependency benefit required to provide the appropriate standard is less.
Some of your Lordships may wonder why the total provision for the children of people receiving national insurance benefits is not being increased again on this occasion. It will be recalled, however, that the total payable to them has been increased twice in the last nine months. It was increased last October by 2s. 6d. a week for each child, and again in April by a further 3s. in the majority of cases, and by 1s. in the rest. The main purpose of this Bill, on the other hand, is to help the family man who is working but is getting low wages. While he is working full time he does not of course qualify for insurance benefits. Yet, as we all know, his income may well be below the supplementary benefit level. It has proved extremely difficult to channel help to families who find themselves in this position. The great merit of the Bill is that it will enable us to do so in a practical and civilised way. It will also help wage-stopped families, another group whose
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obvious need for help is always especially difficult to meet.
My Lords, I can summarise by saying that all the poorest families will benefit either from the family allowance increase or from the proposed supplementary benefit increase to which I have referred. The family allowance increase will benefit the family with two or more children where the breadwinner is on supplementary benefit but wage-stopped, or where, although he is in full time work, his earnings are so low that the family are living below the supplementary benefit level. Other families on supplementary benefit will benefit from the supplementary benefit increase. On this occasion, it is true, national insurance beneficiaries, such as the sick, the unemployed, and widows, do not get an increase. But they have not been forgotten. The rates of their benefits were increased last October, and the provision for their children went up again in April. This Bill will maintain the provision for them at the enhanced rate.
The rest of the Bill, my Lords, is minor and routine. Clause 2 deals with expenses. Clause 3 is formal. Schedule 3 contains provision for the necessary commencement and transitional arrangements. As I have said, we intend the family allowance increase to come into effect on October 8.
Finally, a short word about costs. The additional gross cost to the Exchequer of the 3s. family allowance increase is estimated to be about £55 million in a full year. Adjustment in other social security benefits reduces this figure to about £50 million. If one offsets the extra tax to be paid on account of the 3s. by people within the income tax field, the net cost of the increase becomes about £14 million.
I commend this Bill to your Lordships' House. The Government's object, and I am sure the object of all of your Lordships, is to give some help to the lower-paid family man in work, in what we all acknowledge to be very difficult days. In the circumstances of to-day, the most appropriate way of doing this is through social benefits. Of the social benefits available to us, only family allowances will help the man in work because, unlike national insurance benefits and supplementary benefits, they are paid when he is in work as well as when he is not.

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The Bill gives this measure of help at the expense of the rest of us, because family allowances are paid out of general taxation, and thus it is another step towards achieving the social justice to which we as a Government are dedicated. The contrast between the £55 million gross expenditure and the £14 million net cost is a measure of the financial advantage of selectivity, on which some of your Lordships dwelt in our last debate in March. My Lords, I beg to move.
Moved, That the Bill be now read 2a.—(Lord Bowles.)
2.21 p.m.
LORD DRUMALBYN: My Lords, while thanking the noble Lord for his explanation of the effect of this Bill. I would say at the outset that I do not think this is a Bill of which the Government should pretend to be proud. Having brought into operation an increase of 7s. in family allowances on April 1, within a week this Bill was given a Second Reading in the House of Commons to raise the allowances by a further 3s.; and this second increase was of course entirely due to devaluation. Therefore this Bill is really a sad little tombstone on the Government's economic policy, and quite an expensive tombstone, too—gross £55 million and net £14 million. As the Explanatory Memorandum says, this sum is expected to rise steadily after that, though presumably not by very much, because of the combination of inflation—which will no doubt continue under this Government—and the clawing-back arrangements.
Of course, in the circumstances we would not for a moment dissent from the purpose of the Bill, which is to compensate the poorest families to some extent for the increase in the cost of living consequent upon devaluation. I think I understood the noble Lord correctly when he said that while those families where the father is sick or unemployed, or where there is no longer a father are not forgotten, they will not in fact benefit under this Bill. I do not quite know what is the value of not being forgotten if you do not benefit and if you are badly off.
I think it is right so say that the 3s. increase will not come anywhere near
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compensating the poorest families for the rise in prices consequent upon devaluation, except perhaps in the very short run. In another place the Minister of Social Security said that a man earning £12 a week with four children would get a 3¾per cent. increase in his family income through this Bill, while a man with the same income and three children would get a 2½ per cent. increase. I suppose that if such a man had only two children—this is by and large, I know—he would get only a 1¼ per cent. increase, and that would not go very far towards meeting the higher cost of living as a result of devaluation. Naturally, as between men all earning £12, the more children they have the more benefit they will get out of this; but probably also, the farther they will fall below the supplementary benefit basic level; that is, once the supplementary benefit basic level has been raised, as I understand it is to be.
I would not dispute that, given the circumstances of devaluation, it was appropriate to increase family allowances. The trouble is that, as the noble Lord said, they are not paid for out of contributions to the National Insurance Fund but are paid for out of taxation. My own personal view—and I know that not all my noble friends share this view—is, and has been for the past twenty years, that the system of family allowances is sound and fair. It is clearly fair that family allowances should be paid to all who qualify for them, and that they should be subject to taxation as unearned income. But it is expensive, and anyone who has been Minister of National Insurance or Minister of Social Security knows how very expensive it appears. That, of course, is why the Treasury has always been extremely reluctant to see any increase in these allowances. Since the Government have got the country's finances into such a mess, it is not surprising that they have had to retrench on family allowances.
The principal object of family allowances has always been to aid families in the lower income brackets. But they have been given right along the line because that was, by and large, fair, especially in view of the fact that at the higher levels of income they were pretty well taken away altogether in tax. The reason why they are not restricted

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to the lower income brackets is because a means test was not only invidious but extremely costly to operate, and it was much easier to pay right across the board; and I suppose that still remains true. Since the country cannot afford to carry this out in the fairest way, the only possible way of saving money is by recovering the extra money through the tax system from those who need it least, and that it what is now being proposed in the Budget. It is, all the same, a way which is not without difficulty. As the noble Lord said, it brings an extra 300,000 people into the tax bracket. I do not think that is enormously important, because with the P.A.Y.E. system it will be reflected from week to week. But it means—at least I think it does, and I shall be glad if the noble Lord will confirm this—that a wage earner with more than average pay will already have found that his pay packet is reduced through P.A.Y.E. to enable the Chancellor to claw back part or all of the 7s. increase in family allowances, and the same thing will happen again with the further increase of 3s.
One cannot ignore the psychological effect of those two successive reductions in the pay packet, because that is what will happen. It is true that family allowances are drawn by the mother, but there will be a great effect on wage negotiations and so on when there are two reductions in series. As for taxpayers who are not subject to P.A.Y.E., the sharp increase in their taxation through the reduction in personal relief may come as a very unpleasant surprise at the end of the year. The Chancellor said on January 17 that next year he hopes to introduce full selectivity for family allowances. He went on to say:
"…and to do it in such a way that people who are not in real need of them do not draw them at all."—[OFFICIAL RFPORT, Commons, 17/1/1968]
I am glad that the Chancellor appreciates the importance of ensuring that those who are not to derive any benefit from family allowances should not draw them at all. It is for the Government to make sure that they do not draw them, and not throw on the taxpayer with a family the responsibility of telling the Ministry of Social Security not to continue sending him what, in effect, is his worthless entitlement. because it is going to be
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taken back again, especially as it might well be that a person who received family allowances might be worse off if he were liable to surtax as a result. In any case, not many people nowadays would share the Scriptural dictum, if I may alter it a bit, that,
"The Government hath given and the Government hath taken away. Blessed be the name of the Government.
It is important that the Chancellor should realise his hope and keep his promise in this matter to the letter.
I turn now to one point which might not have come before this House at all but for a slight error in the Explanatory Memorandum. That says that the Bill also
"abolishes entitlement to certain benefits for the first three days of a period of interruption of employment".
We have had an erratum, a corrigendum,or whatever you like to call it, to cut that out, because, of course, that provision was cut out on Report stage in another place. The effect of that provision y^ as that payment for the first three days of sickness and unemployment benefit ant injury benefit was to be abolished. They are, as noble Lords will know, the sc-called waiting days in respect or which payment is made only if the period of sickness or unemployment lasts for 12 days—that is, in effect, a fortnight—except where the contributor has been off work through sickness, unemployment or injury within the previous 13 weeks.
The abolition of payment for waiting days would, I believe, have saved some £17½ million, but to the National Insurance Fund and not to the taxpayer. There is a good deal to be said for doing away with payment for waiting days and a good deal to be said against it. There are instances where a man is better off when he is sick than when he is healthy and working, because his employers pay him his full wages for a period and he gets his sickness benefit as well. On the other hand, where there is no occupational sick pay scheme, the loss of benefit for waiting days would be a serious matter. In other words, payment for waiting days could be abolished only as part of a wider scheme.
I think, if I may say so, that the Minister was right, this time, to withdraw it, but I believe she was very wrong to introduce it in the first stage if she was

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going to withdraw it later. The way in which the Government have handled this matter is really quite extraordinary. They seemed to have put in the Bill the clause abolishing benefit for waiting days without proper consultation with either the T.U.C. or the C.B.I., and then the Minister perfunctorily withdrew the clause in Committee in another place. As my noble frend Lord Avon used to say about the previous Labour Government, "Order; counter-order; disorder." If that is what goes on, it is no wonder that the previous Minister of Social Security resigned. The wonder is that the present Minister has not done so, too, by now.
I know a little about the amount of work involved in the changes in rates of payments of national insurance benefit, and it is very considerable. It is a great tribute to the Ministry of Social Security that no cheep of discontent has emerged into the Press about what must have been a very considerable burden to them. We certainly shall not oppose this measure. We are sorry about this extra burden on the Civil Service under this Government. It seems to me that it has been treated pretty badly. We are also sorry for the country, and we are sorry for the need for this Bill, even although, in the circumstances, we accept it.
2.34 p.m.
LORD AMULREE: My Lords, like the noble Lord who has just spoken, I do not propose to say anything very much against this Bill; but, at the same time, I do not propose to say a great deal for it, because it seems to me to be another bit of rather piecemeal legislation which has come along. What we have been expecting for quite a long time is some general review of the social services to-day. One should have some idea what people require in the way of social services and what they do not.
The second point I wish to make is that I wonder whether this Bill will really go as far as it intends to overcome the poverty of the lower-paid families with their children, because, so far as I can work out, even with the increased rates of family allowances, quite a number of the poorest families will not be brought up to the level of supplementary benefits because of the increase in the cost of living. Does that
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not mean, then, that those families whose need is greatest, where the father is in full employment in a not very well paid job, will not really get much above the poverty line, and that we shall not see any very great change there?
At this late hour I do not want to follow the noble Lord, Lord Drumalbyn, in what he has said, because he has gone into the figures and facts very carefully and I agree with a great deal of his remarks. I would say no more than to give the Bill a rather lukewarm welcome and trust that, in the not far distant future, something rather bigger and more constructive may come along to take its place.
2.36 p.m.
LORD BOWLES: My Lords, we are going to have an interesting debate. There is something in what the noble Lord said, but when he tries to blame the Government for devaluation I would point out that we tried very hard to save the country from having to devalue after the mess left by the Conservatives. I have just looked up Dod to see whether the noble Lord was still in the Conservative Government at the end. I find that he was Minister of State at the Board of Trade. I knew he had been pushed out of the Ministry of Pensions and National Insurance, but I did not know he had been compensated with another job. Anyway, he lent his little help to the disaster which we inherited from his Party. Perhaps we made a mistake, but we tried very hard not to devalue, and this is a method by which we are trying to compensate for and even out some of the hardships which the Prime Minister mentioned at the time would fall upon the people most hurt in this operation.
Now I am not going to bother about the other remarks which the noble Lord made. They were almost his usual speech, if I may say so. They were very interesting, but next time I shall be prepared with the answers so that I can give them straight away. As to the question of the cost of living and the increases that we are proposing here, I think I could prove to the noble Lord privately, although I have not got the details at my disposal now, that in fact nobody is worse of. The poorest people are in fact better off now than they were before. But I do not think it is

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easy to compare a lot of rises in the cost of living with the real value of the family allowances, national insurance benefits, and so on. On the whole, noble Lords, with very grudging support—they thought it was a lot of worry but they are not worrying quite enough to oppose it—are in favour, and therefore I feel quite sure that this House will give the Bill a Second Reading.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

HEARING AID COUNCIL BILL
2.38 p.m.
LORD SORENSEN: My Lords, I beg to move that this Report be now received.
Moved, That the Report be now received.—(Lord Sorensen.)
On Question, Motion agreed to.
Clause 1 [Hearing Aid Council.]:
LORD SORENSEN: My Lords, I wonder whether I might have the permission of the House to move practically the whole of these Amendments en bloc. They are entirely of a drafting or technical or minor nature, with the exception of Amendments Nos. 8 and 9, about which I should like to say just a word or two. I would ask permission to move Nos. 1 to 7 en bloc.
LORD DRUMALBYN: So far as I am concerned, that would be perfectly agreeable.
LORD SORENSEN: Very briefly, indeed, then, a comment on these. The first two Amendments are grammatical corrections. The third Amendment is consequential upon an Amendment made at the Committee stage. Then, in regard to Amendment No. 4, it appears that there is some inconsistency which it is desired this Amendment should clarify. Amendments Nos. 5, 6 and 7 are purely technical. I beg to move the first seven Amendments.
Amendments moved—
Clause 1, page 1, line 22, leave out ("they consider") and insert ("it considers").
Clause 1, page 2, line 14, leave out ("they consider") and insert ("it considers").
Clause 2, page 3, line 21, leave out ("as a supplier of hearing aids") and insert ("pursuant to subsection (1)(b) of this section").
Clause 4, page 5, line 3, at end insert ("and which the Disciplinary Committee has directed to be restored").
Clause 7, page 6, line 25, leave out ("is") and insert ("are").
Clause 7,line 37, leave out ("or supplier").
Clause 7,line 37, after ("aids") insert ("or employing such a dispenser").—(Lord Sorensen.)
On Question, Amendments agreed to.
Clause 10 [Procedure of Disciplinary Committee.]:
LORD SORENSEN: My Lords, in regard to Amendment No. 8, the note given to me says that the purpose of this Amendment is to avoid a present overlap in the rule-making power of the council under Clause 10(4)(e) and (f). Paragraph (e) of subsection (4) provides that the Council shall make rules for requiring the Disciplinary Committee to record a finding that a person alleged to have been guilty of serious misconduct under Clause 7(1)(b) is not guilty of such misconduct where they judge that the allegation has not been proved. As it stands, paragraph (f) relates to the whole of Clause 7, while paragraph (e) provides a special régime for Clause 7(1)(b). The Amendment is designed to limit paragraph (f) to subsections (2), (3) and (4) of Clause 7. I beg to move.
Amendment moved—
Page 8, line 32, after ("under") insert ("subsection (2), (3) or (4) of").—(Lord Sorensen.)
LORD DRUMALBYN: My Lords, I should be exaggerating if I said that the noble Lord has made the purposes of his Amendment crystal clear; but I am certain that he is right.
On Question, Amendment agreed to.
LORD SORENSEN: My Lords, I hope to make this explanation on Amendment No. 9 a little nearer the crystal clarity which the noble Lord desires, but I share with him the slight miasma that possibly is in his mind. My note states that this Amendment is designed to enlarge the rule-making power of the Council where it is deficient at present. It is quite clear so far. Under Clause 7(2) or Clause 7(4) an employer of dispensers.

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other than a body corporate, could be the subject of disciplinary proceedings and the powers of the Council to make rules to require the Disciplinary Committee to record a finding of not guilty of the matter alleged should be extended to such employers of dispensers. I think that that is really crystal clear. I beg to move.
Amendment moved—
Page 8, line 34, leave out ("dispenser or body corporate") and insert ("person").—(Lord Sorensen.)
On Question, Amendment agreed to.

CUSTOMS DUTIES (DUMPING AND SUBSIDIES) AMENDMENT BILL
2.42 p.m.
THE MINISTER OF STATE, BOARD OF TRADE (LORD BROWN): My Lords, before I explain the purposes of the Bill, I should like to say a few words about the international rules on antidumping and on the principles of our legislation. "Dumping" is used colloquially as low-priced competition, but it is defined in the GATT and in our own legislation in a specific way, either selling for export below the home price, or—if that test cannot be applied—selling for export to one country at lower prices than to other countries, or selling at below cost of production. Dumping as so defined is not necessarily objectionable, though it may be if it is believed to be causing or threatening the domestic industry with material injury.
Under the 1957 Act, the Board of Trade must be satisfied on three counts before action can be taken against dumping or subsidisation. First, they must find that the imports are dumped or subsidised within the meaning of the Act; secondly, that this is causing or threatening material injury to a British industry; and thirdly, that such action is in the national interest. During the Kennedy Round, the agreement of many member-countries of the GATT was secured to the full and more uniform application of the GATT rules.
Our procedures already comply generally with the requirements of the Anti-Dumping Code, but in one respect our present powers are not so wide as the Code permits. The main feature of the present Bill is to provide for this exception by giving the Board of Trade wider powers to take provisional action in
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appropriate cases in the interests of our domestic industries. Once a formal application is made, our investigations must be thorough in fairness to all concerned and this inevitably takes time-60 per cent. of the cases take six months or more. The provisonal powers we are seeking in Clause 1 of the Bill are designed to prevent serious injury being caused during our investigations. For reasons of policy and of practical administration, we intend to take provisional action only in cases of real necessity. This is in line with the views of industry and agriculture. One main use of these additional powers will be to deter dumping of seasonal products. We shall also wish to consider action when there is a real danger that importers may bring in large quantities for stockpiling in anticipation of a duty.
We shall normally require applicants to make out a prima facie case to our satisfaction and to show that provisional action is required in their case. Such action will be in the form of a provisional charge to duty imposed by an Order subject to the Negative Resolution procedure. For practical reasons, Customs will normally require the security to be paid by deposit of money. At the end of the provisional period, if our investigations confirm dumping and material injury, a retrospective Order will be made which will be subject to an Affirmative Resolution of the House. If the definitive duty exceeds the provisional charge, only the latter will be levied for the provisional period, and if the provisional charge exceeds the definitive duty the excess will be refunded. Importers will therefore know the full extent of their potential liability and will already have given full security in cash for it. This is not retrospective action in the ordinary sense of the word. In accordance with the Anti-Dumping Code agree in the Kennedy Round, the provisional charge to duty will normally last three months, though Clause 1(3) will permit it to be extended by a further three months. Clauses 2(1) and (2) set out more clearly but do not change in any other way the provisions relating to GATT countries which are already in the 1957 Act in the proviso to Section 1(1). We can therefore repeal the proviso by Clause 2(6).
The second main feature of the Bill relates to countries with centrally planned

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economies. None of the methods of determining a fair market price under the present Act is satisfactory for such countries since they operate artificial exchange rates and their prices do not necessarily bear any relation to domestic costs. We are therefore seeking discretion in the Bill to use another method by reference to the price of similar goods exported to the United Kingdom by other countries with appropriate adjustments to make the comparison a fair one. The new powers will make it easier for us to protect by means of anti-dumping duties British industries that make out a case for action and such duties will be more appropriate than the quota restrictions which are now being progressively removed.
In accordance with long-established practice, we shall normally continue to apply the material injury criterion to non-GATT countries. This is in the interests of both our consumers and consuming industries and our general trading relations with the countries concerned, which are growing export markets. I think the House will generally agree that it would be unwise to take anti-dumping action unless the dumping were causing or threatening material injury. The other changes proposed in Clause 3 are minor adjustments.
Clause 4 of the Bill would give us powers to suspend duties. At present we have powers subject to the Negative Resolution procedure only to reduce or revoke duties, but circumstances could arise where it would be useful to have the new powers. We do not expect the period of suspension to be more than a few months. I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Lord Brown.)
2.49 p.m.
LORD DRUMALBYN: My Lords, I am afraid that I have been on my feet too often to-day. However, I should like to thank the noble Lord for his exposition of this Bill. It gives me pleasure to come to a Bill which I can unreservedly support. I think the Government are to be congratulated on taking this action. They are to be congratulated on bringing to a conclusion the negotiations on the Kennedy Round which helped to bring about
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the condition of this Bill. I do not want to discuss this in any detail to-day. I entirely agree with what the noble Lord said about the need to retain the material injuries provisions; although I think it is fair to say that we should very much like to get a recognition from other countries of the desirability of this in their case also; so that they would not apply dumping duties unless there are material injuries. This, however, is not a matter for us to legislate on; it is a matter for them, and I hope that they will do it.
My Lords, also, plainly, the point of national interest should not be forgotten. This has to be taken into account whether or not there is material injury to a particular industry. There is only one point to which I should probably like to return at the Committee stage, and that is the retrospective action when a duty is finally imposed as against a provisional duty.
LORD BROWN: My Lords, my understanding is that this is a Money Bill, so that I shall shortly be moving that there shall be no Committee stage. In case the noble Lord is reserving some of his comments for such a stage I thought that I ought to warn him.
LORD DRUMALBYN: My Lords, I am obliged to the noble Lord; I should have recollected that. Perhaps I may put the point briefly in this way. Clause 2(4) refers to the imposition of a duty to take the place of the provisional order that will have been made. Before that, as the noble Lord explained, and as I understand it, the importer will simply have given security for the duty but will not have paid the additional duty imposed by a provisional order. There is a curiosity here, in that the words, "or threatened" do not appear. Clause 2(4) says:
"An order shall not be made imposing a duty on goods of any description retrospectively by virtue of section 1(1) above, unless the Board of Trade are satisfied, as regards importations made during or before the period of the provisional charge, that the effect of the dumping or of the giving of the subsidy has been such as to cause material injury to an established industry in the United Kingdom."
I do not quite understand this, because if a provisional charge has been made, I do not see how material injury could be occasioned. I presume the importer will have increased his price by the amount of the security that he has had to pay in respect of the duty he may have

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to pay in the future when an order is finally made.
Moreover, it seems to me, from experience, that it would be difficult to see what the effect is and I should have thought that the words, "or threaten" should have been included so that the subsection would read:
"…has been such as to cause or threaten material injury to an established industry in the United Kingdom."
The harm might not yet have been caused, but it might well have been threatened; and it might be threatened very considerably if the order were not made at all. Looking at it merely from that point of view I think it is necessary to take account of whether injury is threatened if no such order is made. I hope that I have made the point clear. It is the one doubt I have.
The rest of the Bill seems more or less all right, except that I should like to ask this question. When we are dealing with countries which form part of a trade bloc, like the E.E.C., I take it that we shall deal with them as separate countries and not as a bloc; so that if we are to impose a duty on goods of a particular kind coming from one country then, in general, one would have to inquire from the other countries whether they objected to the imposition of the duty. I take it this would be so in regard to E.E.C. Clearly, my Lords, this is not so applicable in cases where there are blocs, and I wonder whether we ought not to make provision in the Bill for those circumstances.
My Lords, the other point referred to by the noble Lord related to Clause 3(2) which deals with countries where, as a result of Government monopoly of control, a fair market price cannot be appropriately determined in accordance with that clause. I wonder whether the noble Lord would comment on this point? It is already the practice so far as treaties are concerned, and has been for some time. Does the noble Lord think that it is going to be easier or more difficult to negotiate treaties now that this is part of the law of the land? Because as soon as it is made statutory, you lose a certain amount of flexibility of negotiation. If you make it statutory, then whoever is negotiating
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will say, "Well, this is part of the law of the land and there is not much good arguing about it." On the other hand, one loses a little flexibility. I am sure that the noble Lord will consider this point, and I merely wish to make the point that, so far as some of the Iron Curtain countries are concerned, to my certain knowledge this has already been included in one treaty and I daresay that it has been included in others. It seems to me that that is the only possible way in which we can safeguard the interests of our home producers, and indeed the producers in other countries, from whom we import. As I have said, I can give an unreserved welcome to this Bill, and I congratulate the noble Lord on having brought it in.
2.56 p.m.
LORD BROWN: My Lords, if I may I will answer the noble Lord's questions. He hoped that other countries would bring in the same criteria of material injury as we have done. The fact is that the countries which are accepting the Kennedy Code, if I may refer to it in that way, will be bringing in this criteria because it is part of the Code. Unfortunately, some countries have not signed that part of the Kennedy Round; namely, Australia, South Africa, Austria and Portugal. There are others, but those are the countries which are causing anxiety. We hope that one day they will come into the fold. I regard it as a rather sad part of international negotiations that some countries are allowed to get the main benefits of a wide international agreement without signing all parts of it. That has always seemed to me to be a grave anomaly, but apparently in times gone by it has not been the custom of Government to regard this with great seriousness. I voice this anxiety myself.
My Lords, the complex situation to which the noble Lord has called attention relates to the basis upon which injury to British industry will be judged when in fact, as a result of introducing a provisional charge, the situation in which injury might have been said to arise will have been changed to one where no injury arises. That was the point he was making. This question of judgment as to the injury arising will all the time have to be based on the situation pertaining

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prior to the introduction of the provisional charge. This must be so. One cannot thereafter take this attitude.
LORD DRUMALBYN: My Lords, may I make the point quite clear? Suppose that the import in question was of a periodic character, and suppose that a provisional order was made in regard to this product, and that shortly before the end of the period a large consignment of the goods arrived. Obviously, they could not possibly have caused material injury by that time, but they could have threatened it. This is the point I had in mind, and I wonder whether it would be reasonable, inasmuch as the goods will have come in before the end of the period, although they have not actually caused injury, to apply the duty to those goods. But, as I understand it, that is not possible as the clause is drafted.
LORD BROWN: My Lords, I think I can reassure the noble Lord on this point. The difficulty in drafting has been to make sure that we can take action where it seems to be appropriate, yet at the same time avoid putting ourselves in a situation where some British industries or firms are irresponsibly demanding this action from us, not on the basis of proof of material injury but, in some cases, because they are being out-quoted by a competitor who, without dumping, is quoting lower prices. The noble Lord knows that this occurs.
I have read with a great deal of attention the Reports of the debates in Committee in another place, and I realise that the complexity of drafting was considerable. I noted the explanations there given, and I think I can assure the noble Lord that we have put ourselves possibly in the best position in which we could get when between two fires: one, the anxiety to be able to do what is appropriate, and the other, to avoid putting ourselves in the position when we might have to take action when in fact we did not have reasonable assurance that material injury was taking place, in
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which case of course we should be outside the Kennedy Code on dumping. So I think that I can reasonably reassure the noble Lord on these grounds.
On the third point the noble Lord raised, I am sure that the interpretation of this would lead us to regard E.E.C. not as a bloc—in other words, we should be dealing wih separate counties in E.E.C. in relation to making arrangements under this Bill.
On the fourth question the noble Lord raised, about the Eastern bloc, Clause 3(2) does no more in the way of change than to give us a situation which we have not had before, and in which we should be able to use as a criterion of dumping from Eastern European countries, where they have controlled economies, the fact that imports coming into this country from other countries are at a consistently higher price than those coming in from Eastern Europe. In taking account of this criterion, we cannot take even the middle prices of other countries, but have to base our comparison with the prices from Eastern European countries on the lowest undumped prices from those other countries. This is a new situation. It gives us an extra degree of freedom in negotiating with Eastern Europe which will be extremely useful. I think that this may be the outcome of this Bill. It will not decrease our flexibility in dealing with Eastern European countries. It will certainly have the effect of making us a little more daring in getting rid of quotas, which are extremely bothersome to negotiate and to maintain, and some times very unfair, and substituting other means of preventing our industries from being damaged by imports from these countries. I hope that these explanations are adequate, and that your Lordships will now feel able to give this Bill a Second Reading.
On Question, Bill read 2a: Committee negatived.
House adjourned at four minutes past three o'clock.