Lords Sitting of 5 November 1969

Preamble
The House met at half past two of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Leicester):
The LORD CHANCELLOR On the Woolsack.
The Viscount Combermere—Sat first in Parliament after the death of his father.

PUBLIC RECORD OFFICE
LORD CACCIA: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they are now able to anounce their plans for meeting the long-term needs for search room and storage accommodation in the Public Record Office.]
THE LORD CHANCELLOR (LORD GARDINER): My Lords, approval has been given in principle to the erection of a second Public Record Office on a site owned by the Crown in Ruskin Avenue, Kew. It is hoped that the first stage of the building will be completed in the mid- 1970s. When the building is finished it will provide accommodation for 750 readers a day, and the 360,000 feet of additional storage accommodation which it is estimated will be required by the end of the century.
LORD CACCIA: My Lords, while thanking the noble and learned Lord the Lord Chancellor for his practical decision on a foreseeable need, may I ask him one further question on the time factor? In view of the increasing pressure on accommodation for records and for readers, both from overseas and at home, will every effort be made to ensure that at least some part of this new building, and as large a part as possible, will be available by the mid-1970s?
THE LORD CHANCELLOR: My Lords, although the immediate needs have
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been met by converting a large part of the Land Registry for the use of the Public Record Office, I would agree that the need for a new building is an urgent one.
VISCOUNT DILHORNE: My Lords, may I ask the noble and learned Lord the Lord Chancellor whether the new building will be large enough to accommodate the records which at present are not stored at the Public Record Office but are stored elsewhere; or will there always, even now, have to be a separate store for public records?
THE LORD CHANCELLOR: My Lords, I think there may have to be a separate store for some. The Advisory Council on Public Records are still considering what would be the best division. I think that they anticipate probably keeping everything for this century, and the things which are more normally required, at Kew, and the medi wal documents and legal documents in the existing building in Chancery Lane.
LORD PARGITER: My Lords, may I ask my noble and learned friend to what extent microfilm is used, in order to save space?
THE LORD CHANCELLOR: My Lords, I think a good deal of microfilming is done. Certainly the photographic side is large. But I think that none of us knows at present how long a microfilm itself will last.

CIVIL AIR TRANSPORT: EDWARDS COMMITTEE RECOMMENDATIONS
THE EARL OF KINNOULL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government how soon legislation will be introduced to give effect to the recommendations of the Committee of Inquiry into Civil Air Transport.]
LORD BESWICK: My Lords, as the noble Lord will appreciate, it will first be necessary to state the Government's policy arising from the Edwards Committee recommendations, and this will be

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done by a White Paper to be published in the very near future.
THE EARL OF KINNOULL: My Lords, while thanking the noble Lord for that rather vague answer, may I ask him whether he is aware that as long ago as May 2 his right honourable friend anticipated that the Government would be producing their White Paper during the summer? Can he not be a little more precise and say whether it will be by Christmas time? Can he also say whether we are to presume that since no legislation was mentioned in the gracious Speech no Bill will be introduced this Session?
LORD BESWICK: My Lords, I accept what the noble Lord says about the need to get on with this matter. I should have liked to give him an actual date for the publication of the White Paper. I cannot do so, for certain reasons, but I think it may be a matter of days rather than weeks. So far as the gracious Speech is concerned, I think that if the noble Earl looks at it again he will find that there is a reference.

RAILWAYS: USE OF CONTINUOUS WELDED RAIL
2.36 p.m.
LORD NUGENT OF GUILDFORD: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will make a statement concerning British Railways policy with regard to laying down long welded rail, and what special safety measures are being taken in that connection.]
THE PARLIAMENTARY UNDER-SECRETARY OF STATE FOR DEFENCE, R.A.F. (LORD WINTERBOTTOM): My Lords, the British Railways Board, whose responsibility this is, have informed my right honourable friend the Minister of Transport that they intend to extend the mileage of continuous welded rail as quickly as possible. There are several reasons for their adoption of this policy. It will lead to an increased life for the track components and reduced
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maintenance costs: it will lead to a smoother ride for the rail vehicles using the track and for the passengers in them; most importantly, there will be a greatly reduced risk of broken rails, and such breaks as do occur will be likely to be less dangerous.
The Board say that since 1960, when the laying of continuous welded rail was started, the Code of Practice they have been using has been regarded as satisfactory. But the unusual weather conditions and the high occurrence of track distortions in continuous welded rail in the recent summer have shown that the margins already provided must be increased to ensure the stability of continuous welded track. Your Lordships may be interested to learn that the distortions in jointed track in 1969 have also been greatly above average. The special measures the Board have now put in hand to increase the margins of resistance to heat distortion in continuous welded track take the form of increased ballast provision and of the re-adjustment of the continuous rails themselves to a higher stressfree temperature condition than has hitherto been deemed necessary. This work should be completed before the onset of the hot weather of 1970.
LORD NUGENT OF GUILDFORD: My Lords, I thank the noble Lord for his full Answer to my Question. May I ask him whether he is aware that, in the light of recent accidents, there is a good deal of anxiety about the safety of the continuous welded rail, despite its obvious advantages? There are two questions that I do not think the noble Lord completely answered in his full reply, which I should like to study. The first is whether the continuous welded rail is out of the experimental stage; and secondly, whether experience in this country and elsewhere has been sufficient to establish all the facts needed for satisfactory laying down and maintenance. If the answer to the second question is "Yes", why are we still having trouble? If the answer is "No", can the noble Lord tell us what action, other than what he has now told us, is being taken to establish maintenance satisfactorily?
LORD WINTERBOTTOM: My Lords, first of all, we are in close contact with other nations using continuous welded rail. There is a constant interchange of information between ourselves and other

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countries using this system. If I may be completely frank with the noble Lord, I think the problem is that it is well beyond the experimental stage. In the beginning of this process from 1960 there were no accidents, but it is considered that it is possible, although by no means certain, that as continuous welded rail becomes a commonplace perhaps the standards to which this track is laid are not as closely rigid as was the case in the early stages of laying continuous welded track. In my Answer your Lordships will have noted that the Code of Practice is being surveyed and tightened up to ensure that the admittedly rising number of accidents in continuous welded rail do not in fact continue. The result of the inquiry into the accident at Somerton may show that the abnormally good weather conditions this summer caused the accident.
LORD NUGENT OF GUILDFORD: My Lords, may I ask the noble Lord one further question? Is he aware that his reference to the abnormally good weather conditions of this summer and the higher temperatures, is rather disturbing? Is he further aware that in other countries in Europe and America, where far higher temperatures obtain, a great deal of experience must have been gained, with wider ranges of temperature difference between summer and winter? And is the noble Lord aware that there is a rather uncomfortable feeling that there his not been quite the sufficiency of care given to this innovation that there ought to have been?
LORD WINTERBOTTOM: My Lords, the noble Lord may think it worth while to debate the report on the accidents that have taken place which will appear early in the new year.
BARONESS WOOTTON OF ABINGER: My Lords, my noble friend has said that welding will increase the life of the rail. Can he give us an assurance that it will not diminish the life of the passengers?
VISCOUNT ST. DAVIDS: My Lords, can my noble friend say whether he and British Railways have taken account of the fact that what were abnormal temperatures last summer may not be abnormal if we continue to discharge carbon dioxide into the air by the burning of various fossil carbons, so increasing the greenhouse effect?
THE MARQUESS OF ABERDEEN AND TEMAIR: My Lords, is it possible that welded rails can be satisfactorily used for very complicated crossovers, such as exist outside London Bridge?
LORD WINTERBOTTOM: My Lords, that is a technical question which I am afraid I am not able to answer. This may come out in the inquiry.
EARL FERRERS: My Lords, can the noble Lord clear up one point? In one of his replies to my noble friend he said, I think, that the standards used now are not so accurate as the standards used in 1960. Did the noble Lord mean that the standards used now are different, or that the implementation of the standards is not as precise as it was?
LORD WINTERBOTTOM: My Lords, it is just possible that familiarity may be breeding some contempt, if I may put it this way, and it is for this reason that the Railways Board are re-examining the codes of procedure relating to the laying of this track.
BARONESS WOOTTON OF ABINGER: My Lords, my noble friend did not answer my question, apparently on the ground that it was thought to be frivolous. It was not frivolous, and I would ask: can he give us an assurance that the welded rail is not shortening the lives of the passengers?
LORD WINTERBOTTOM: My Lords, if I may say so, that is a very different question.
LORD BELSTEAD: My Lords, the noble Lord has given us a wealth of information but, arising out of the question of the noble Baroness, Lady Wootton, can he tell us where the experiments on which a great many of his statements are based are taking place?
LORD WINTERBOTTOM: My Lords, I shall have to write to the noble Lord on that point.
LORD KILMANY: My Lords, will the noble Lord take into consideration the anxiety of other Members of this House, and will he not make it possible for the whole House to be aware of this interesting information when he has ascertained it?
LORD WINTERBOTTOM: My Lords, may I repeat what I said? The accidents that took place this summer are at present the subject of a study, and a report will be issued early in the new year. Without doubt, it will be a very detailed report. May I suggest to noble Lords that its publication may provide an opportunity to discuss the implications of the accidents that are taking place.
THE LORD BISHOP OF EXETER: My Lords, may I ask the noble Lord whether this report will also cover the accident at Somerton in Somerset?
LORD WINTERBOTTOM: Yes, my Lords, that is correct; it will.

NATIONAL SUPERANNUATION SCHEME
LORD BESWICK: My Lords, at a convenient moment after half past three my noble friend the Leader of the House will be making a Statement on the terms of partial contracting out from the National Superannuation Scheme.

RIDING ESTABLISHMENTS BILL [H.L.]
VISCOUNT MASSEREENE AND FERRARD: My Lords, I beg leave to introduce a Bill to confer further powers on local authorities with respect to the licensing of riding establishments and to amend the Riding Establishments Act 1964. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read 1a.—(Viscount Massereene and Ferrard.)
On Question, Bill read 1a, and to be printed.

ADDRESS IN REPLY TO HER MAJESTY'S MOST GRACIOUS SPEECH
2.45 p.m.
Debate resumed on the Motion moved on Tuesday, October 28, by Baroness Gaitskell—namely, That an humble Address be presented to Her Majesty as follows:—
"Most Gracious Sovereign—We, Your Majesty's most dutiful and loyal subjects, the Lords Spiritual and
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Temporal in Parliament assembled, beg leave to thank Your Majesty for the most gracious Speech which Your Majesty has addressed to both Houses of Parliament."
THE EARL OF DUNDEE: My Lords, the number of your Lordships who have indicated your intention to speak to-day is greater than it was yesterday, and I do not want to take up much time. I should like first to make a short reference, for the sake of continuity, to yesterday's debate, and then to refer equally shortly to the question of industrial relations and also to the question of regional industrial development.
I greatly enjoyed the winding-up speech last night of the noble Lord, Lord Brown. I agree with him that in this House we can do more good if we discuss these matters in a non-Party spirit, and I sympathised with him when he said that if we always blame the Government for our economic difficulties, we shall only encourage the ordinary citizen to think that he has no responsibility at all. But, if I may say so, I have been in politics for longer than the noble Lord, and I feel I ought to warn him that, whatever we say here in this House, the ordinary citizen will always continue to blame the Government, not only for everything that goes wrong but for a great many things that go right, too; and all Governments will probably continue to claim the credit for what goes well, although it would probably have gone still better if only they had left it alone.
The noble Lord said that when the present Government took office in 1964 there was a high rate of industrial activity combined with a big trading deficit for that year, and he seemed to imply that this Government rather expected to go out of office in about a year's time, leaving a large balance-of-payments surplus together with inactivity, as he said had been the case in 1958. On the other hand, the noble Lord, Lord Beswick, was a little more sanguine. He thought it was likely that we were moving into circumstances in which a balance-of-payments surplus would be combined with greater industrial activity and growth. That is what the two noble Lords said. They did not make quite the same prediction, but I could not help feeling that it would have improved the Government's public image a little if only the Government could

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have predicted what was going to happen before now with a little less inaccuracy than in fact they did.
My noble friend Lord Jellicoe told a story yesterday about a French prince who was a very bad shot, but he had a loyal and faithful servant who always fired at the same time as his master and then said, as the quarry fell stone dead, "Monsieur tire à merveille". The speeches of the two noble Lords on the Front Bench opposite made me think of an even better and more loyal servant, the native batman of an Anglo-Indian colonel who was a very bad shot indeed but who was invited by a Maharajah to an enormous duck shoot. The batman loaded for his master, who fired 1,500 cartridges without visible result. When they got home the adjutant took the batman aside and anxiously whispered, "Tell me, did the commanding officer shoot as badly as he usually does?" But the batman drew himself up and replied, "Sir, the colonel sahib shot with impeccable accuracy, but God was merciful to the birds." I think that for the last five years God has been very merciful to all the birds at which Her Majesty's Government have aimed.
The rate of economic growth was the biggest and fattest duck which they have missed. Under the National Plan it was to be 3·8 per cent. a year for six years, which was rather an interesting figure because that six-year total was exactly one-quarter of 1 per cent. less than it had been in the previous six years without any National Plan at all. What actually happened was that the target was introduced one year after it was meant to begin and then abandoned four years before it was meant to end. There was, however, a second barrel in the Government's Election Manifesto of March, 1966, which predicted that the standard of living—not economic growth, but standard of living—would go up by 25 per cent. in five years. In fact, the only thing which has gone up in five years by nearly 25 per cent. is not the standard of living but the cost of living, and I really think that that is an unrivalled record of sustained progress.
On taxation, the noble Lord, Lord Beswick, told us yesterday, almost gleefully, that a Conservative Government could not abolish S.E.T. unless they put forward an alternative tax which would
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be equally, or even more, objectionable. I suppose that if we really tried hard enough we could work out a tax which might do even more harm than the selective employment tax, but there was a time when the late Chancellor of the Exchequer said he hoped to carry through the Government's programme without any increase in taxation at all; and if one goes a little further back in history there was a Government which even reduced taxation by £2,000 million in 13 years, in spite of carrying through a very large programme of social reform and economic progress.
As for high interest rates, which in my view may be even worse than high taxation, especially for small businessmen, I shall always remember the touching scene on the introduction of Mr. Callaghan's pre-Election March, 1966, Budget which I witnessed from your Lordships' Gallery in the other place, when he and George Brown publicly shook hands on the Treasury Bench after it was announced that there would at last be a reduced rate of interest for house-purchase loans to people of small incomes, who could opt, if they did not pay income tax, to get the loan at a reduced rate. It is a sad memory for me, because even now, I am told, the option scheme is being revised, and even after the revision the rate of interest which these smallest householders will have to pay on a house of average size will actually be £1 10s, a week more than it was in 1964. I think that the rise of the interest rate on house-purchase to 8½, per cent. has very seriousy retarded the expansion in home ownership which has been going on, but much too slowly, since the early 'fifties. Britain in general, and Scotland in particular, is still predominantly a rent-paying country, and I do not think we shall solve our housing problem until we have become a nation predominantly of house-owners, like Canada or the United States.
But, my Lords, the most recent miss of all, in the present year, was the Industrial Relations Bill. Your Lordships may remember that it was talked about quite a lot before it was abandoned. According to The Times and the Financial Times —I forget whether this was an official hand-out or one of those leaks, but, anyhow, it was in The Times, the Financial Times and other papers—the Prime

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Minister told a Party meeting in April that this Bill was
"essential to our economic recovery, essential to our balance of payments and essential to full employment".
That may have been, perhaps, only the art of hyperbole. Anyhow, we must all hope that it is not really true. He is then reported to have said that the passage of this Bill was
"essential to the Government's continuance in office".
Some people might not mind very much if that was true. But I do not think anybody believes, and I am sure none of your Lordships believes, that when the Government dropped that Industrial Relations Bill they were truly satisfied with the general assurance from the Trades Union Congress that they would try a little harder to settle unofficial strikes than they had done before.
If I may try briefly to summarise the position as I see it, I think the Donovan Report gave a useful analysis of the problem, although most of us did not think much of their recommendations, on which members of the Commission did not seem to be very united. One thing which they stressed—rightly, I think—was that the number of working days lost in strikes, in which we had always thought we compared fairly well with other industrial countries, is not a true measure of the damage inflicted on our economy, and that the number of strikes, excluding those in the coal industry, has been increasing for a good many years.
My Lords, the gracious Speech tells us that Bills will be brought in
"to promote improved industrial relations and to provide for equal pay for men and women".
I think we are aware what the proposals about equal pay for men and women are likely to consist of, but I do not know what other Bills there will be, and it may be too early at this moment to ask the noble Lord the Leader of the House to tell us what the nature of the Bill or Bills will be "to promote improved industrial relations". I certainly will not press him if he is not ready to tell us now.
On the other hand, the Government have the great advantage of being able to criticise, now or at any time, with all the strength of their departmental information and their official knowledge,
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the proposals of the Opposition. It is not often that an Opposition sticks out its neck, as the present Opposition has done, by publishing, more than eighteen months ago now, our full and detailed, though of course provisional, proposals, with the intention that the public should have every opportunity both of understanding and of criticising those proposals. They have already been discussed, attacked and defended many times in your Lordships' House as well as outside it. I think it was last week or the week before that the Prime Minister, according to Press reports, suggested that although we are the only industrial country where collective industrial agreements are not legally binding, yet other countries may have more to learn from us than we have from them. I am sure that we all have a great deal to learn from each other, but I doubt whether any of those other industrial countries would wish to follow the present example of the United Kingdom in this matter.
Almost exactly two years ago the ex-Minister of Labour in the present Government, Mr. Gunter, made what I think was a very true observation about this subject—and this is the only quotation from Hansard which I propose to inflict on your Lordships. It was actually in reply to a Question on November 13, 1967, about the dock strike. But he went beyond that. He said:
"The disturbing thing about the docks strike—and, indeed, about many elements of British industry—is that it is an unofficial stoppage.
"Perhaps I may give an example. When Mr. Walter Reuther brings his men out on strike in the American motor car industry, they have had at least three years' peace. No one has broken a contract. When he takes them back, there is another three years in which they can plan and wait. The dilemma of British industry is continuous interruption of production lines. No one knows when it will strike next."—[OFFICIAL REPORT, Commons, 13/11/67; col. 35.]
I think that that is a very pregnant observation and I would say to your Lordships that this is an urgent matter of trade union reform which ought to be dealt with quickly. I wish that it could be dealt with in this Session. If it is not dealt with quickly, then this country will suffer grave disadvantage in its economic growth in comparison with other free countries of similar industrial capacity.

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Finally, my Lords, the gracious Speech says that the Government
"will continue to foster the fullest use of resources in all regions and will lay before you measures to provide for assistance to industry in intermediate areas."
I should first like to say this. I agree with the Government diagnosis of our present unemployment problem. When I was a member of the last Government I remember that we had two very short but relatively acute periods of unemployment, one in the winter of 1958–59 and the other in March, 1963, which were mainly due to weather. We were strongly attacked—I thought rather unreasonably—on account of these figures. But as my noble friend Lord Jellicoe pointed out yesterday, for the last year or more the figures have been at a much higher average level. Nevertheless, I still think the Government are right in saying that the present problem of unemployment is regional and not national: there is no real unemployment problem in the London area, in the South-East or in the Midlands.
I should also like to say that I commend the Government's activity in pursuing their policy of attracting more industry to the development areas. I think that the policy of using industrial development certificates, to refuse them to industries in one area in order to persuade them to go to another, is a justifiable policy. I am certainly not speaking of this in any kind of Party spirit, because on one occasion in 1958 I criticised my own Party as I thought they were being less active in pursuing this policy than they might have been. I believe that our development area policy reached its best level from 1960, when my noble friend Lord Eccles brought in the Local Employment Act, to 1963, when Mr. Maudling's Budget gave a 100 per cent. depreciation allowance to industries in the development areas.
While I am glad that this Government are pursuing the same objectives, I think that there are one or two points on which their tactics may not be quite riqht. Your Lordships will forgive me if my examples are from Scotland, which is the place I know best, although of course the other development areas in North-East England, in Wales, and especially in Northern Ireland (which I had the great
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pleasure of visiting for some days the week before last) are equally important. There is one point on which I am doubtful of the Government's tactics in this matter. In Scotland there is the policy of a general spreading or dissemination of industry and development, in preference to one of growth points—but this is rather a technical matter which I will not pursue this afternoon. Moreover, I think it was a mistake to substitute the present investment grants for the depreciation allowances which had been given in 1963.
I know the Government's argument on this matter and I quite understand it. Their argument is that a depreciation allowance does not benefit the smaller owners of industry who cannot claim it because they may not be within any income tax bracket and, therefore, it is weighted in favour of the larger owners whose firms are paying income or corporation profits tax. I sympathise with that, for I am much in favour of more smaller industries. I will not trouble your Lordships with figures, but I believe that on balance the depreciation allowances were doing substantially more good in Scotland than the present investment grants, particularly since those grants do not apply to all the kinds of machinery which were covered by depreciation allowances. I would prefer it if this course were abandoned and if we went back to what was done in 1963.
My Lords, the final criticism that I have does not apply to Scotland because, since nearly the whole of Scotland is a development area, there are no intermediate areas in it. But so far as the other parts of Britain are concerned, I am rather doubtful whether the regional employment premium is producing the best results for value of money because I think it may sometimes be attracting industry not from the conurbations, but away from the "grey" areas; and that it may to some extent be discouraging industrial development in areas which might, in a year or two, fall behind the present development areas in economic growth.
I have spent a minute or two longer than I meant to do on this point, my Lords, because I think it right to make it clear that we on this side of the House believe that this kind of control through industrial development certificates makes

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common sense, since it is not the kind of control that is administratively top heavy, although in general we maintain that there is too much Government control over the whole field of industry and we believe that our economic growth would benefit if Government control in general were to be substantially reduced. May I conclude by offering my very genuine good wishes to the Government for a very successful Session—and I think that they will need all the good wishes they can get.
3.10 p.m.
THE LORD PRIVY SEAL (LORD SHACKLETON): My Lords, the noble Earl, Lord Dundee, has made one of his admirable speeches, genial and short. The last is a special virtue of his, one which I always hope to emulate but which I confess I do not always succeed in doing. He raised some interesting points: for example, that fascinating argument which goes on sometimes even within Government on investment grants versus investment allowances; but I do not think that he will expect me to get drawn very far into that. I realise that there is a real area of discussion here; none the less, it is our view that investment grants are capable of doing, and have done, much for industry.
We are to have two very interesting maiden speakers to-day, the noble Lord, Lord Stokes, and the noble Lord, Lord Brougham and Vaux. I have known Lord Stokes for many years. I used to stand outside the factory gates at Leyland's many years ago, More the noble Lord rose to his present eminent position. I am sure that we shall have a very interesting speech from him; and indeed from the noble Lord, Lord Brougham and Vaux. I feel that the present Brougham and Vauxes have probably changed a little from their most distinguished ancester. We shall look forward to hearing from both noble Lords. It is unfortunate, and I must apologise for it to the noble Lord, Lord Stoke—I have indeed two apologies to make to the House—because it is likely that I shall have to rise again as soon as I sit down in order to make a Statement on partial contracting out. Such an interruption is always disturbing for a maiden speaker. I hope that many of your Lordships will be able to hear those
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two noble Lords, even though I suspect that they would very much prefer that there was no one in the Chamber when they made their speeches.
I must also apologise because I may have to disappear for half an hour or an hour immediately afterwards to attend a very urgent meeting. I do not feel too badly about this, since those who are to speak immediately after me (I except the noble Lord, Lord Crook), or some of them, were not present during the first day of the Economic debate. I make no special point about that beyond the general observation, and I am sure that the noble Lord, Lord Carrington, will be with me in it. Some noble Lords sit through debates and provide support for their colleagues, but there are others—and I can use a rather more direct form of language—who, just occasionally, or regularly, go off.
I should like to start by referring to the speech of the noble Lord, Lord Carrington. I do so because I thought it was a very courageous speech, although it did not arise in this particular part of the debate. I consider that it was very timely. I feel a certain obligation also to stand up and be counted, like the noble Lord, Lord Gladwyn, although I do not think I can go all the way on certain points in support of the enormous advantages there will be to us and to Europe if we are able to enter the Common Market. I must acknowledge that there are noble Lords on both sides of the House (I suspect that there are more on the side of the noble Lord, Lord Carrington, than on mine) who are against it. But we have some formidable characters—like the noble Lord, Lord Blyton—who put up very effective arguments on this subject. I would only say that no one at the moment would suggest any form of unconditional commitment. The very objections which opponents have drawn attention to are the matters on which we must negotiate. On the other hand, I believe that our entry, if it comes about, will bring strength to the whole European Community, of which I consider we are a natural member. We must not forget, and it is relevant in an economic debate, that in the E.E.C. living standards have been rising faster than our own, and it would be a brave man who would dare to predict that if we remain outside this trend will be reversed.

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I think it is not only Europe who may benefit from our entry; and I believe it is the duty of this country and other advanced countries to increase their production and raise their standards, not only for themselves but in order that they may also contribute to other parts of the world. I felt bound to say this because the noble Lord, Lord Carrington, made a wholly un-Party political speech although one which I fully acknowledge as being controversial; and I know there may be at least one noble Lord, the noble Lord, Lord Blyton, who will, I am sure, be putting the case against it in his usual forceful way.
LORD BLYTON: Hear, hear!
LORD SHACKLETON: Well, my Lords, I was giving my noble friend a bit of a preamble, a lead-in.
LORD BOWLES: We shall all wait for him.
LORD SHACKLETON: And also perhaps people will come and listen to the noble Lord, Lord Blyton. I hope so, because it is disheartening suddenly to find yourself, round about five or six o'clock, speaking in an empty Chamber.
My noble friend Lord Beswick, like my noble friend Lord Brown, made a notable speech. Lord Beswick referred to the "Decline and Fall Squad" and singled out the noble Earl, Lord Cromer. I am not sure whether the noble Earl is present to-day, although I told him I was going to speak about him. I do not think the noble Earl may be accused of being in the "Decline and Fall Squad", although I consider that his place has been taken by the noble Viscount, Lord Eccles—but I will leave him out too. Certainly I think that he joined the "Puzzle Squad", along with the noble Lord, Lord Erroll of Hale. Lord Erroll danced lightheartedly over the scene, and I think that he did not really understand what the noble Earl, Lord Cromer, was saying. I suddenly realised that there must be something about the air of Altrincham and Sale. Like his friend the present Member for Altrincham and Sale, the noble Lord, Lord Erroll (I have to be careful here), seemed—perhaps it is not too unkind to say this—to lose touch with reality a little; and we noted the job of "demolition" which was done
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by the Chancellor of the Exchequer in another place.
My Lords, I think that most of us are pretty bored with the allegations about trade figures being fiddled. I express my appreciation to noble Lords who, characteristically did not take part in what was described by my right honourable friend as one of the nastiest of little political stunts, but I am reluctantly bound to refer to it, not because of anything said by noble Lords opposite but because Mr. Chapman Pincher has returned to the attack. I suppose we could say that we should not bother about him, but it is really intolerable to have that sort of misrepresentation which is read by lots of people.
The figures that were published were understood by all the responsible newspapers—The Times, the Telegraph, the Financial Times. None of them got it wrong; and to make statements such as that it would not do a company no harm to claim that the correct figure was given in small print at the end—he does not say that the Government did it, he implies it—is wrong, because the Government did nothing of the sort. If noble Lords want to see the statement, they can. It is a full statement, and the full explanation under the visible trade balance explains the position; and the papers understood it. This point is important, because we have to get it right. The Government did not take a euphoric line on it. My right honourable friend the then President of the Board of Trade warned people against euphoria, and in particular in his statement said that if allowances are made for the combined effect of these factors, the improvement in the visible balance between the second and the third quarter remains very substantial; from an average deficit of £20 million a month in the second quarter to a surplus of £4 million a month in the third—which is an even smaller figure than Mr. Chapman Pincher and the Member for Altrincham and Sale used.
These figures are complicated, as the noble Earl, Lord Cromer, pointed out. I think that Lord Cromer took a simpliste or optimistic view. It is really rather surprising to find an ex-Governor of the Bank of England thinking that these figures about a complicated subject are capable of being deployed in a very simple manner. He said, for instance,

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that the trade figures did not give a useful indication of the balance of payments. I should have thought this was something we all knew. But they are of value, as my noble friend Lord Balogh pointed out, as indicating the trend of visible trade.
Then again, the noble Earl said that we had achieved almost complete obscurantism. I can only say that responsible newspaper editors, and I am sure noble Lords on both sides of the House, understand it. Finally, the noble Earl suggested that we should get rid of the monthly reserve figures, on the ground that they reveal nothing. I agree with him, but, of course, it is customary to publish them. One can now and again pick up some unconsidered trifle from them, and probably be misled by it. When he uses such trifles in the context of looking at the balance of payments, they are certainly misleading. In the long run the answer comes out, together with the balancing item only on the current and long-term balance of payments figures—and even they, as the noble Earl pointed out, are subject to amendment over a period of two or three years.
The truth of the matter, my Lords, is that, so far from making excessive claims, the Government have consistently underplayed the position—or at least have been scrupulous not to overplay it—for fear that people would take a too easy and optimistic view. None the less, I think it was apparent from the speech of my right honourable friend the Chancellor of the Exchequer, and from that of my noble friend Lord Brown, that the situation is such that we can take a reasonable degree of encouragement. It would be lunacy, of course, to think that we are out of the wood while there are all sorts of dangers to the progress of the economy.
It is a pity, I feel, that the noble Earl, Lord Jellicoe, and the noble Lord, Lord Erroll of Hale (and I think the noble Earl, Lord Dundee, recognised this) kept on emphasising one point, even though it is one with which I entirely agree. They said that the credit must go to those in management and on the shop floor, and that the Government should not seek to take all the credit. It is curious, however, that the converse is
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always argued when things go wrong. In my view it is a pity that we should have had this ridiculous red herring introduced. I am sure that we shall continue in this House to manage to discuss important issues of industry and the economy objectively.
I should like now to turn to consider the speech of the noble Earl, Lord Lauderdale. The noble Earl (I thought he was here, but I am unlucky in my audience to-day) must have been surprised by the warmth of the reception given to his speech. It could have been conceived in the spirit of a red-hot technological revolution. I am sure that if it had come from this side of the House, the noble Lord, Lord Erroll of Hale, would have mocked at it. The noble Earl really waxed lyrical as he described the possibilities and prospects of this country, provided that we seized our opportunities, particularly in the field of ports and sea communications. With all sincerity, I would commend noble Lords who did not hear the noble Earl speak to read his speech, beginning at col. 294 of yesterday's Hansard, which I am glad to say is in our hands to-day. There is a challenge here, and I do not think the noble Earl was embarrassed when my noble friend Lord Brown drew attention to the relevance of his speech to the Government's proposals for the reorganisation of the ports.
I am sure that noble Lords will not dismiss this particular set of proposals just in terms of a conflict between private and public enterprise. I think that talk of doctrinaire nationalisation rather tends to fade away, especially as we see the growing success of some of the nationalised industries. The greater part of the major ports of this country are already in public hands. There is, in fact, only one run by a company, half of whose capital is provided by Manchester Corporation. It is apparent from the noble Earl's speech, and indeed from the White Paper, that the logic of the new development in transport methods and technologies—containerisation, unit loads and all that the noble Earl was talking about—demands that we shall have a co-ordinated strategy which, despite the efforts of the British Transport and Docks Board and other bodies, is not possible until there is a unified control. This does not of course mean that the National Ports

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Authority will operate ports from the centre, though it will be establishing policies and strategies. I believe that it will be possible to combine in a proper mixture local interests and matters which will be decided locally with the national need.
One important aspect of our proposals is that we believe they will give an opportunity for bringing about better industrial relations in the ports. Nobody knows this problem better than my noble friend Lord Crook. I should have liked to let the noble Earl, Lord Lauderdale, know something of other points he raised, but I will save time by leaving them now.
I should like to turn to some of the institutional measures which the Government have taken. Here again the noble Lord, Lord Erroll of Hale, made fun of the various proposals—and admittedly his speech was funny, with his MAXTECH and MINPROD. Even though he was not responsible for thinking up MAXTECH, I think he may have invented MINPROD. Though I agree that we must not just tinker around with Government and there is a danger of it having a disrupting effect, I am absolutely satisfied—and so are those concerned with these changes—that the new institutions both in Government and in some of the public bodies are calculated to produce more satisfactory results, both for the citizen and for industry. I think we must recognise that change is a bit uncomfortable. But the logic of bringing together the Prices and Incomes Board and the Monopolies Commission, which sometimes escapes people, becomes only too apparent when one sees certain areas which might be subject to investigation by either body and some co-ordination is necessary here. The noble Viscount, Lord Amory, drew attention to the vital nature of a prices and incomes policy, and the Government are giving it urgent and detailed consideration. We hope to be issuing a White Paper before the end of the year.
The intention in merging these two bodies is that they may carry out more tidily and effectively a range of functions at present divided between the two. The Monopolies Commission, for example, examines mergers and whether they are likely to be contrary to the public interest. The Prices and Incomes Board has been concerned with private companies and with the public sector of industry. It is
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also concerned, as the Monopolies Commission is, with problems affecting pay and its relation to the efficient use of labour. There is a large area of potential overlapping, and the merging of these two bodies, I think, will produce a stronger and more effective body as a single unit. The role of the body will be constructive as well as regulatory. I think this will be helpful to industry. We are well aware that industry does not like being investigated unnecessarily, and any references made to the Board will have to be made with the agreement of the Minister who is particularly concerned with the sponsorship of a particular industry. But I believe that, properly handled, as it will be, this again will provide the sort of flexible machinery which allows private enterprise, and for that matter public enterprise, to continue freely and independently to do its job, but to be subjected to the type of influence which occasionally is necessary, and which has operated through other types of institutions in industry.
There are other important reforms, both of a social and of an industrial character. One, again affecting the industrial area, is equal pay. The Secretary of State for Employment and Productivity will be introducing a Bill to provide for equal pay as between men and women. This is an important measure of social reform, and I am sure that the principle will be supported. The Bill will provide that equal pay should be fully implemented by December 31, 1975. The Government's view is that this is a reasonable period for industry to adjust to the change. But it gives rise to a number of detailed problems, although, happily, not in the non-industrial Civil Service, for which I am responsible, because we have had equal pay there for a number of years. There are to be discussions—and they have already started—between the Secretary of State, the C.B.I., the T.U.C. and others, and I believe that following those discussions we shall be able to produce satisfactory measures which will be valuable socially and also play their part within the industrial scene.
I have already mentioned that I shall be making a Statement shortly on partial contracting out. There has been curiously little discussion during this debate on the national superannuation scheme. It is, I admit, a very complicated subject. I

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fear that it is one of the matters which, again with the best will in the world, it is not easy to produce with simplicity. But not the least important aspect of this will be the guarantee of a pension in a country where half the population have no occupational pension. Many who lose their rights if they lose their jobs will in future be able to qualify for a pension; and even if they leave their jobs it will be transferable or frozen. Apart from the social advantage, this will be of value to industry, whether at managerial or shop floor level.
Another piece of legislation which falls in the same category is that which relates to industrial health and safety. A number of my noble friends—Lord Crook, Lord Collison, Lord Taylor and Lord Blyton —have been active and interested in this field. We are rightly concerned about suffering animals, and we quite rightly get very concerned in our debates at proposals for factory farming and so on. But we seem to be curiously inured to the ill-health and suffering that still arises in our workshops in this modern age. It is a long haul, but we simply cannot wait. Year after year noble Lords and Members of another place raise this matter, and although a great part of our factories legislation is pretty good, it needs amending, developing and bringing up to date in a number of respects. I must say frankly that we shall not be able to complete the job in this Parliament; but we are going to bring certain measures which bear directly on the subject of safety. It is worth reminding the House that we pay an infinitely higher price for ill-health and injury in a week than we do in a whole year from industrial disputes.
In the field of organisation. I should like to give a plug to my own Department, the Civil Service Department. It is not, admittedly, a Department with the most glamorous title; and is not one whose work will naturally attract the attention of Mr. Chapman Pincher and others. But we are engaged in implementing a number of important reforms from which this Government and successive Governments will benefit. I have paid tribute to the Civil Service. No one, I find, is more enthusiastic in carrying out this work than those officials in my Department who are charged with the
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responsibility. The efficiency of our central Government machine is crucial to our national efficiency, and improvements here will contribute greatly.
Some of your Lordships may have seen the document, Progress on Fulton, which has been placed in the Library. Since that Report was published in the spring the momentum has increased. The planning of the Civil Service College is now well advanced, with a branch in Edinburgh, a branch in the country near London and the Centre for Administrative Studies actually in London. We are deeply involved in the question of examining the grading structure, which will mean major job evaluation exercises across an enormous field; personnel management (my own particular interest and experience) and recruitment, to which again the Fulton Committee devoted a great part of their Report. We are bringing in a great deal of industrial advice, not because I believe that industry necessarily has a great deal to teach the Civil Service, but because in certain areas it has something, as we have something to teach it. We have a number of industrialists and consultants, as individuals, working closely with us, and we find that there is a mutual exchange and a great degree of common understanding because many of the problems are similar whether in Government or in industry.
Some of the results have already appeared. We have already proposed the carrying out of an interim merger of classes at lower levels as well as a statement of intent to form a common grading structure at the top of the Civil Service. There are to be major decisions taken in the next few months—they are too many for me to list.
No less important is the attention that is being paid to those recommendations on the organisation of work. We have just completed (and I hope that it may be possible to publish it, though I cannot give a promise on this) a major study of the need by Government for computers over the next year. It occurs to me that I should like to send the glossary associated with this Report, almost a dictionary of all the words that are coming into our language, to the noble Lord, Lord Conesford, because in order to understand the definitions, you have to look up other words in the same glossary!

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There is to be a thorough review of the future of our management services, a programme of experiments and studies in accountable management, management by objectives and output budgeting—or the Planning, Programming and Budgeting System. All these have been started and have gained considerable momentum. We have a long way to go in these fields, but I can assure your Lordships that the groundwork is being thoroughly prepared. I am confident (and I hope that anybody who is working in any activity regards his own work as important) that this will be of significance. What has particularly struck me has been the enthusiasm of the Civil Service staff, and the co-operation between staff and management through the staff side of the National Whitley Council, which in industrial relations is unequalled anywhere in this country or, I would say, in the world.
My Lords, I had an interesting passage to deliver, but I do not propose to do so, on the new developments on the presentation of public expenditure. This is an area where the Government have made considerable progress, which has been welcomed by the Committee on Procedure in another place.
I should like to say a few words on certain other points: first of all, unemployment. Reference has been made to the level of employment in October, and I do not wish to minimise the importance of this figure. Nevertheless, it is necessary to probe it a little further. There is still a relatively high level of vacancies, one which would normally be associated with a much lower level of unemployment. In most areas there has been good absorption of summer school-leavers. The development areas are in a relatively better position than in the past, and there is a large flow of people on and off the register. I am sure that noble Lords—if they have not thought of it already—must agree that the development of earnings-related unemployment benefits and, in some cases, redundancy payments—both of which this Government introduced—has meant that some of those who have become unemployed are being more selective in seeking fresh work. They do not have to take the first job offered to them. This of course has advantage economically as well as socially, because if they go into jobs for
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which they are better suited they are more likely to be productive.
Because of the shortage of time I will not go into the problem of the development areas. We know that much of the loss of employment has been due to the decline of traditional industries in those areas. This is the principal reason for their designation as development areas. Government preferential expenditure on the development areas in the year 1968–69 was £270 million. Although much of the assistance to industry is not specifically linked to the creation of new jobs, none the less there is special assistance, and 380,000 new jobs have been created since 1965. I sometimes wonder what would have happened if we had not had the system of regional support that this Government have so fully developed.
My Lords, I do not propose to go on any longer because we look forward to hearing a number of valuable contributions from noble Lords; nor shall I follow the noble Lord, Lord Erroll of Hale (who has somewhat handicapped me by not being present at this moment) in producing any innuendoes. Although we live in an uncomfortable age, it is certainly nothing like so uncomfortable, in terms of living standards, as in those drab years in the past. I must emphasise that in the past few years, during the lifetime of this Government, living standards have been steadily rising; and this is shown by countless indicators, whether it has been an increase in the number of motor-cars, television sets or even central heating systems. One may laugh and say that these are not very pleasing indicators. But they are. And they are important to the comfort of life, and should improve its quality.
Industrial production has risen strongly —by about 8½ per cent. in two years—and we are in a unique position, for this country, in now seeing a favourable trend in the balance of payments while production still continues to rise. Our total debit and credit position—on which there has been some discussion—is probably slightly better than it was a few years ago; and despite our external difficulties Britain has remained a net external creditor nation. At the end of last year our net external assets exceeded liabilities by almost £2,000 million, due to the steady increase in the value of net

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long-term assets. I do not think that this figure is as vital in the short term: the really vital question, from the point of view of the balance-of-payments position, is not our net credit or debit position, but the capital flows and the interest receipts or payments associated with them. It is in this area that so many of our problems have confronted us.
We shall need to sustain our improvement over a long period. We now have a chance to free ourselves from some of these agonising difficulties imposed by the balance-of-payments problems that have bedevilled us ever since the war—and I would remind noble Lords that they would have bedevilled us before the war, too, if there had not at that time been mass unemployment. At least we are moving in the right direction, and this is where we are perhaps coming to a clearer understanding in this House. I hope we shall not fall into the error of being too confident and relaxing our efforts, but let us also show some real pride, whether it is by the Government or the people, in our achievements, in which there is quite a lot to be proud.
3.46 p.m.
LORD STOKES: My Lords, I am well aware of the custom of your Lordships' House whereby maiden speeches crave the indulgence of the House. This I am more than happy to do. I am, moreover, aware of two other customs; namely, the desirability of being both brief and noncontroversial. Here, however, I must ask even more strongly for your indulgence again, since I have a difficult theme and I am more accustomed to speaking to the shop floor rather than the Floor of the House. I must also declare a personal interest in industry in general, including the Industrial Reorganisation Corporation, and the motor industry in particular.
As an industrialist, I welcome the Government's successful efforts to improve our balance of payments, and I must applaud their determination in not faltering after a few months' initial success. There is no doubt that if any economic policy is going to be successful it has to be consistent, and one of our big difficulties as manufacturers in the past has been having to cope with the vacillating policies of successive Governments. Whatever one's views on how the nation's resources are distributed, the fact re-
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mains that most of our balance of payments success is due to industry taking up the export challenge and, in particular, to a relatively small number of companies who are carrying most of the burden in competing in fiercely competitive overseas markets. In fact over half our direct exports are accounted for by a little over one hundred companies, although I am not underrating the part played by our many suppliers.
I have always accepted that industry must regard the whole world as its market, not just this country, and until we do we shall never be successful either profit-wise or in developing an aggressive industrial mentality. At the same time, we must not neglect the fact that to export successfully most industries must have a readily available domestic market to absorb some of the overheads of aggressive exporting. This may not necessarily be logical, but in many cases is due to the restrictive measures of many of the countries with whom we either trade or compete.
If I may quote an example: much play has been made of the success of the Japanese motor industry in obtaining export markets, but it should always be remembered that they have a virtually restricted home market from which meaningful foreign competition is excluded, and from that protected base they export substantially, but in total it amounts only to 18 per cent. of their output. Our British motor industry, on the other hand, has succeeded in exporting nearly 50 per cent. of its output with a home market depressed by credit squeezes and yet, at the same time, open to international competitors throughout the world whose mere presence here effectively controls our home selling prices. The Japanese market is also protected by import quotas on 120 items, by high tariffs and tight controls on investment by foreigners. If we operated under similar conditions to the Japanese—which I do not advocate—we too could make even greater inroads into almost any market. As it is, Britain as a country exports more than twice as much per head of the population as Japan, and in this respect is second only to Germany.
Independence, individualism and free enterprise have always been cherished words in the industrial sense in this country. If, however, we are going to

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succeed in the world trading stakes we cannot afford the luxury of small, individualistic firms, or of sleepy giants, who are not prepared to expand and to meet the challenge. Industrial concentration of our meagre resources in this small country is vital if we are going to compete, and this is particularly so in the capital intensive industries. In this connection, I believe that the Industrial Reorganisation Corporation as an industrial catalyst has been most worth while; it has been the most worth while of almost all the institutions set up by the present Government. It is vital that it is continued with the same independence under which it currently operates.
Size for the sheer sake of it is no argument. There are, however, obvious and real advantages of economies of scale in purchasing, research, product rationalisation, large-scale marketing projects, and the combined financial strength to enable one to ride out fluctuations caused by market changes or by individual project failures. Most important of all is the ability to attract and to use to the full the best management and specialist talent that will be available to large companies. In the end it is always people who matter.
Mergers or takeovers, issued sensibly, can unite skills or techniques into one composite, competitive whole. They enable scarce managerial talents and expertise—probably the scarcest resource in this or any other country—to be more effectively used, and thus enable us to stand up to the sheer size of some of our major overseas competitors. It must be admitted that size brings its own problems. Critics of what is sometimes called "giantism" talk as if the problems of large size were parallel with those of small size. Several of the problems of smaller companies are incurable except by growing bigger. It is, however, axiomatic that successful small firms grow big unless their owners take positive steps to keep them small, either by denying them capital for expansion or merely by being reluctant to take on additional responsibilities in these days of high taxation. To my mind, the problems of large size are basically organisational and they are therefore curable, provided that we can find and attract and reward inspired management, who in the end must be the key to all business success.
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It is of course worth remembering in this context that firms which may appear giants to us in this country are in reality quite small on the world scene; and it is only in the global sense that industry must think to-day, including the possibilities of many more trans-national associations. While I think it can be proved that industrially large groups are vital for our international competitiveness, they contain the seeds of their own destruction. I refer, of course, to the tremendous problems imposed by the sheer numbers of the work force of any large organisation. Large corporations to-day tend to pay their employees better, provide better working conditions, and act in the most responsible way possible; yet at the same time, merely because of their size, they often become bedevilled by more industrial disputes and problems than are smaller organisations.
At the present time we are getting into a most dangerous situation in this country, with the future livelihoods of all of us at stake, because of the action of a number of people pressing pay claims, mostly unofficial, which do not go through the normal procedural channels and in many cases are completely unrelated to any increase in productivity or efficiency. It is becoming common practice for groups of people to withdraw their labour in breach of normal agreements and to hold to ransom whole industries on which the country's survival depends for the sake of piratical pay claims which, if granted, merely spark off a whole series of similar leapfrogging demands. The end result is that the cost of products and servicing goes up, to the detriment of all, and is rapidly exhausting the gains and sacrifices made by the last devaluation. We should all like perpetual increases, but it must be becoming obvious even to the most obtuse of us, that, if continually applied across the board as attempted at the present moment, they are self-defeating. All we shall achieve is a rapid rate of inflation and a loss of competitiveness.
Because of the complicated and interdependent production processes of the mass producer, the automobile industry is perhaps more vulnerable than most; but as the largest exporter, the loss so caused to the country by this industry alone is

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incalculable in real terms. British Leyland, which is my own company, alone during the last year, but for strikes, could have manufactured an extra 100,000 motor cars, of which at least 50,000 would have been exported, representing some £26 million sterling extra to our balance of payments over and above our existing record export financial contribution. The extra cash flow generated by this lost continuity of production would have been applied to purchasing more modern plant and equipment to keep ourselves competitive, and it would also have been applied to paying wages which, in their absence, have been made up by strike pay or by social security benefits or in some cases, I regret to say, one suspects, even by unprecedented sickness benefits, which indirectly are all added to the country's overhead costs.
This drain on our investment fund availability is reflected in the fact that 59 per cent. of the machine tools in the motor industry in the United Kingdom are over ten years old. This compares with only 42 per cent. in Germany and only 36 per cent. in Japan. As a country we are devoting a lower proportion of our gross national product to investment than are all our European competitors. Investment is particularly important at the present time in order to ensure that the export-led boom is sustained by an investment-led recovery in the home market. We suffer, I suggest, in this country from a legacy of "we" and "they", which is a hangover of Victorian paternalism and prejudice. Memories are sometimes too long, and the minds of too many of us stretch backwards rather than look forwards. The next few years must see great changes in the relationships between the work force of this country, their unions and managements, all of whom have an equal share in the task of running companies at all levels. All who share in this task must receive proportionate rewards; but rewards carry responsibilities, which also must be fully shared. This means a positive approach from management, unions and Government.
Management itself must work much harder at communication, particularly in the large companies. "Communication" is a much abused word to-day and I do
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not think there is anyone in industry who is unaware of the necessity to communicate. But what do we communicate and how do we do it? In a small organisation this is no problem. The manager, by his physical presence in walking round the works, can know everybody and give a full sense of participation. As the organisation becomes larger, so the management tends to become remote, and therefore much has been, and is being, done by joint works councils, productivity committees, works newspapers and so on, to reach directly the men on the shop floor and to prevent, as in the old parlour game, the message getting distorted down the line as the number of ears increases. These are areas in which management must take the initiative.
In the age of big business and big Government there must also be big and strong trade unions. We cannot run factories without strong and efficient trade union organisations, and in the same way as industrial concerns must merge and reorganise themselves to meet the changing times, so too must the unions review their structures and their own multiplicity in order to enable them to maintain reasonable disciplines over their members, and adherence to bargains which have been freely entered into by them on behalf of all their members, taking into account the varying conditions of the individual plants concerned.
The shop steward to-day has one of the most responsible and difficult tasks in industry. If he confines his activities to the plant in which he is accredited, supports his union and is given full support by management, he has a tremendously potential power for good in so far as the company, its workpeople and the country's prosperity in general are concerned.
We live in a permissive society where, perhaps, people are once again seeking to reassert their individuality beyond the restrictions induced by repetitive tasks. If we want high remuneration, shorter working hours and a greater affluence then reasonable disciplines must be accepted, preferably voluntarily, and elected representatives must be able to negotiate on the basis that their agreements, once entered into, will be maintained for an agreed sufficient period of time to enable the productive machinery to fulfil its purpose.

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One of the main aims of the Government's document, In Place of Strife, was to ensure that agreements, once made, were kept and that proper procedures were adhered to. I am doubtful whether legislation is the sole answer to our problems, nor do I consider it realistic to think in terms of attaching fines to particular individuals, although it may well be that employers and unions should be made more responsible for their collective actions. Industrial relations have fundamentally to do with attitudes of mind, and the purpose of any legislation should be to create an environment in which attitudes can more easily be changed. I think this has largely been the success, for instance, of the Race Relations Act, and any such legislation is best kept to the minimum necessary. In industrial relations I suggest that a start could probably best be made by insisting on a secret ballot prior to any major strike. A further considerable improvement would be a move to three-years contracts on pay and conditions, as they are negotiated in the United States of America. Unions must be responsible for their members, and poaching from one union to another must be discouraged, otherwise the whole structure of responsibility is damaged. A concerted effort on these fronts by management, unions and Government working together could pull us through these difficult times.
We are, of course, not the only country to suffer from strikes and labour indiscipline. In France, Italy, the United States of America and Japan, for example, industry has been suffering from problems which are in many ways as bad as or even worse than ours, and the number of days lost through industrial disputes is even greater than our own.
My Lords, it would be quite wrong to leave you with the impression that we in British industry are masochistically obsessed with our difficulties. On the contrary, we are only too conscious of the challenge and the opportunity facing us, and impatient of anything which hinders us from responding to them. Our export record shows that we are rising to the challenge. Our exports this year are up 15 per cent. over last year, and for the first time since the war we are holding our share of world trade as a nation.
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Our need now is to build on the success we have already achieved. To do this we must learn—all of us, whether in Government or in industry or whatever—to cope with change which is occurring at a faster rate than ever before in history. I believe we can do this, probably better than any other people on earth, but we must be aware of the difficulties of trying to solve this urgent and vital problem in the relatively remote atmosphere of Westminster. In the industrial areas of our land feelings run high and it will require political acumen and persuasion of the highest order to make a change back from militancy to reasoned negotiations. I thank you, my Lords.

NATIONAL SUPERANNUATION SCHEME
4.4 p.m.
LORD SHACKLETON: My Lords, with permission I should like at this point to make a Statement on partial contracting out under the National Superannuation Scheme. It will fall to my noble friend Lord Crook to congratulate the noble Lord, Lord Stokes, but I must say—and I am sure the whole House will agree—that it was a most remarkable and satisfactory speech. However, I will not take up time by saying more now, because nobody is better qualified than my noble friend Lord Crook in this area of industrial relations.
My Lords, the Statement that I am about to make on the National Superannuation Scheme closely parallels one which is being made in another place by my right honourable friend the Secretary of State for Social Services, who yesterday laid before Parliament a White Paper setting out the terms on which the provision for partial contracting out will be made in the Bill introducing the national superannuation scheme and copies of the Paper (Command Paper No. 4195) are now available in the Printed Paper Office. The Government attach great importance to the role of occupational schemes as partners with the State scheme; and before deciding on the contracting out terms, we consulted the T.U.C., the C.B.I., and a wide range of organisations with a special interest in occupational pension matters.

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These consultations gave us a comprehensive view of all the relevant issues, and the Government are greatly indebted to those who took part.
The purpose of having contracting-out facilities is to offer occupational schemes the opportunity of taking over responsibility for part of the State scheme pension and in this way to limit the extent to which occupational schemes may need to cut back both in contributions and benefits when the enlarged State scheme is introduced. As to the scale of the contracting-out provision, our initial suggestion was that the annual rate of pension for which contracted-out schemes would take over responsibility might be set at around 0·9 per cent. of the earnings on which the employee contributed to the State scheme. It was represented to us, however, that occupational schemes would find it helpful to take over responsibility for a rather bigger share of the pension; and we decided, with a wide measure of support from those we consulted, that for men the annual amount of pension for which the occupational scheme would take over responsibility as a condition for contracting out should be 1 per cent. of the employee's reckonable earnings. For women, who have a lower pension age than men, the equivalent figure is 0·55 per cent. of reckonable earnings.
We sought the advice of the Government Actuary on what deduction from State scheme contributions would correspond to these deductions from the State scheme pension. He advised that, on a strict actuarial calculation, a contribution abatement for the employee amounting to 1·25 per cent. of his reckonable earnings, with an equal deduction from the employers' contribution, would be fair for the average occupational scheme. Most of those we consulted wished to have a bigger contribution abatement, and although we could not go as far as they wished without being unfair to employees not contracted out, we have decided to go beyond the strict actuarial terms based on averages and to abate the contributions for contracted out employees by 1·3 per cent. a side of their reckonable earnings. The Government Actuary has advised that this improvement in the terms should be sufficient to make them financially acceptable to a
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further number of schemes covering an appreciable number of employees.
We are confident that on these terms the balance will be struck fairly between those employees who are partially contracted out and those who are not. The way in which the terms have been arrived at is described in full detail in the White Paper, which shows how far the Government have been able to go in meeting representations from the occupational pension interests and contains supporting information which will repay careful study.
I now turn to matters affecting public service pension schemes for which responsibility lies also with a number of my right honourable friends and in regard to which I, in my capacity as Minister in charge of the Civil Service Department, have a particular responsibility. The Government have a special responsibility for the public service schemes and in view of the misunderstandings that have been voiced in recent months about our intentions towards these schemes, I should like to make the following points clear.
First, we have no intention whatever, as has been alleged, of dismantling public service pension schemes. Members of the public services take a pride in their occupational schemes, and the Government understand and share these feelings. It should not be forgotten that occupational pension schemes were pioneered in the Government service. Secondly, whatever changes in present occupational schemes may be necessary after the introduction of the new State scheme, we do not intend that benefits earned by previous service in existing schemes should be subject to retrospective change. Thirdly, anxieties about the retiring age have been expressed on behalf of the police and fire services, and other groups who because of the special nature of their duties cannot continue in their present employments until the age at which the State retirement pension comes into payment. There is no intention of making a change in their retiring ages. Fourthly, where the Government are the employers, any necessary changes in occupational pension arrangements will be fully discussed with staff representatives, as I have no doubt other employers in the public services, and I hope elsewhere, will be doing. Indeed, in many areas such consultations have already begun. We have

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no intention of acting precipitately, or without full consultation with staff interests.
It is not in question that changes are necessary in public service pension schemes. One of the disadvantages of pioneer schemes is that if they are not periodically reviewed they get out of date. In the Civil Service, for example, we are all aware that, despite the many improvements that have been made in recent years, the arrangements for preserving or transferring the pensions of those who leave for other work are still not nearly as comprehensive as we should like to make them. In another field, the Government are already pledged to seek better ways than the series of Pension (Increase) Acts of reviewing the level of pensions already in payment.
But it would make no sense at all to reshape occupational schemes to deal with these and other points without at the same time taking into account the important part to be played by the new State scheme. The pensioner is concerned with his total pension benefits, and careful co-ordination is essential to ensure that the pensioner gets the right benefits from the two schemes, State and occupational, taken together, without avoidable gaps or duplication. This is the way to ensure that the member does not have to pay too much in contributions and that he gets value for money. Clearly, any adjustments that may be needed to take account of the State retirement pension will apply only when the individual is old enough to receive it. Those who retire on pension before the State pension age will still receive an immediate pension as good as that which they would now receive; necessary adjustments to take account of the State retirement pension will apply only at the State pension age.
This is the background against which we shall be discussing changes with staff representatives. The discussions will cover not only any changes needed to take account of the new State scheme, and whether the public service schemes should make use of the partial contracting-out facility, but also any proposals that staff representatives themselves wish to put forward.
The Armed Forces are in a special position but my right honourable friend the Secretary of State for Defence has
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asked me to say that the same general approach will be adopted in considering what changes may be necessary in their present arrangements.
My Lords, I have been dealing with those schemes for which the Government have a special responsibility. In setting up occupational pensions schemes the nationalised industries have also exercised a pioneering role. Their schemes may also need to be adjusted in the light of the proposals for the new earnings related State pension scheme. I am, however, confident that, taking the State and occupational pension scheme arrangements as a whole, there will be better provision for future pensioners and their families throughout public sector industry generally, as there will be for public service pensioners.
4.15 p.m.
LORD DRUMALBYN: My Lords, I should like to thank the noble Lord for that very full Statement. I am sure all noble Lords will wish to study it in detail, and also the White Paper that has been laid; because without doing so undoubtedly they will not be able, any more than I am, to understand its full meaning. But may I ask the noble Lord one or two questions?
The accumulation of personal savings represented by the net growth in occupational pension funds in 1968 was reckoned as £810 million. I wonder whether the noble Lord has any estimate that he can make of the effect of the present proposals on occupational pension schemes surpluses. After all, the noble Lord, Lord Stokes, whose speech we have all so much enjoyed, has just been laying emphasis on investment and the amount of our resources that have to be devoted to investment. Of course, the State scheme is going to be a pay-as-you-go scheme and not a scheme which is going to enable a large proportion of investment to be made; so therefore this question is absolutely crucial.
There is one point—I do not know whether it is made clear in the White Paper— which I think may be puzzling your Lordships, as it is me. The Statement talks about an abatement of 1 per cent. of the employee's reckonable earnings. I think that what your Lordships would like to know is what proportion this will represent of the employee's

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actual pension when it comes to be paid —not just the reckonable earnings, but what proportion of the pension that is to be carried by the occupational pension scheme as a basis of contracting out. Those of us who have had experience of pension schemes and their passage through Parliament will know that the working together of occupational schemes with the State scheme is always the point of greatest difficulty in setting up these schemes, and I think we may find that to be so in this case, too.
The noble Lord spoke of a wide measure of support. I take it he means a wide measure of support for these proposals in the context of the Government's intentions to set up these schemes, and not necessarily a wide measure of support for what is going to happen to occupational schemes as a whole. After all, the original White Paper envisaged that any such arrangements as the Government are proposing are likely to lead to the winding up of a certain number of occupational pension schemes.
May I say one word about the public sector? The public sector accounts for more than half of all employees at present contracted out. It is not clear from what the noble Lord has said to-day whether the expectations of pension in the public sector are going to be affected or not. This particularly applies to those who reach their peak earnings at the end of their service. The noble Lord said that, if they retire before the age of 65, under the new proposals they will get until they reach 65 the full pension that they would otherwise have received. But he seemed to imply that their present pension expectations thereafter—not referring to retrospective payments—will be adversely affected by the present scheme. We should like to know whether that is so or not.
Finally, the noble Lord referred to discussions still to take place. From that I would assume that the Bill cannot be presented for some time. Perhaps the noble Lord will be able to give us some indication of when the Bill is likely to come before Parliament.
LORD SHACKLETON: My Lords, I congratulate the noble Lord. When I sat down I nearly said, "I hope your Lordships understand it." I understand my part of it, but the other part is very com-
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plicated, and although I have been very involved in it it has taken me a long time to grasp all the factors. Unfortunately, I did not make a note of the noble Lord's points, because I thought he was going to make only one or two; if I miss anything perhaps he will remind me.
First of all, he raised the important question of the effect of funds available for investment. When I say that I cannot give an answer to that question, it is because it is not yet possible to tell what the various schemes will do. This was a very big factor in the mind of the Government, not only in the interests of retaining partnership and keeping good occupational schemes going, but because this is an important source of funds. The figures that the Government have now arrived at have taken this sort of consideration much into account; but it is not really possible to be more precise, although obviously this is a matter of importance.
Then the noble Lord asked me what proportion of pension would result from the abatement figure. Here again, the proportion in the total amount will depend on the earnings and therefore the actual entitlement to pension. If the noble Lord studies the new State pension scheme he will see what I mean. I shall, however, be able to give him a table; and if it is of help to your Lordships I will see whether it is possible to put in the Library some other information if the information that is contained in the White Paper does not cover this matter far enough.
The noble Lord then raised the subject of the discussions. I do not think that these will necessarily hold up the preparation of the Bill itself, which is far advanced. Discussions on the general nature of the scheme and on the level of contracting out—and we have to remember that at least half the population of the country are not in occupational scheme at all—are now complete. The next stages will be consultation between employers and employees on how they propose to adapt the occupational scheme, to mesh it in with the State scheme when this comes into effect. On that point discussions will go ahead. In my area of responsibility in the public service we are ready to proceed. We have a joint committee in existence and some discussions have already taken place; but it has not been possible to

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make them really meaningful until the level of abatement was fixed.
I believe the noble Lord asked me one more question, about the level of pension for those who have to retire early by the nature of their job. I do not think I can add anything to the carefully chosen words that I have already given; but it is meant to be an absolutely firm assurance that those who have to retire early by nature of their particular jobs —and the list I gave was not exclusive, but those are the ones with regard to whom concern has already been expressed—will still get a retirement pension at that age as good as they would expect to get now.
LORD ILFORD: My Lords, I have not yet had an opportunity to see the White Paper or the other document to which the noble Lord referred. May I ask the noble Lord whether he is able to give an assurance that the quite comprehensive arrangements under which local government officers at present retire will not be modified to their disadvantage?
LORD SHACKLETON: My Lords, that is quite an appropriate question, because it is in the area of local government that the greatest concern has been expressed, by NALGO in particular, and I must frankly say that I find it most difficult, after the explanations that have been given by my right honourable friend, to see why they are so concerned. It is clear that if one is introducing a new and revolutionary pension scheme which will apply to all the community, modification in occupational schemes to take account of the new scheme must take place. But, of course, considerable additional benefits will flow to the occupational scheme employee. There will be a much better prospect for him, in regard to both frozen pensions and the transferability of pensions. There is a whole area which will be the subject of negotiation, and I should be most surprised, taking into account the responsibility and the power of the unions and the attitude of the employees, if the ultimate outcome is not most satisfactory. But obviously there must be a certain disturbance of existing arrangements.
Being, as I am, one of the great unpensioned, I find myself heavily engaged in ensuring that those for whom I am
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responsible really have a good deal, and I am quite confident, and should not be embarking on this scheme if I were not well satisfied as to what we are likely to achieve with the Civil Service; and this will, I think, tend to set the pace across the field of the public services. I do not myself have direct responsibility over the local government field—that is for the local authorities; and my right honourable friend the Minister of Housing and Local Government is responsible at second hand. In the last resort my Department plays a co-ordinating role. Anything that the noble Lord can do in the light of that assurance to put people's anxieties at rest will be helpful, because it would be a great pity if, in this suspicious age, there should be some feeling that people were going to be "done down".
LORD LEATHERLAND: My Lords, may I put one or two questions to my noble friend? If he cannot answer them now, I shall be quite content if he says that he will look into them. The first question follows on what the noble Lord, Lord Ilford, has mentioned and concerns local government employees. These local government employees now retire at so many fortieths of the salary they have been drawing for the last three years of their service. Is that kind of employee likely to be better off, or worse off, under the new Government scheme? The second point concerns equal pay for women which we are going to see in operation in six years' time. Will the fact that in 1975 women are to get equal pay in any way throw the actuarial calculations off their balance? The third point is—
LORD SHACKLETON: My Lords, may I deal with those two questions while I remember them? On the first point, which concerned the terms for local government employees, I would say that these are matters which employers and trade unions and the staff side will want to discuss. There are various alternative ways of calculating pension entitlement. This is not a completely open and shut matter. The Government have set out the framework and this is a matter which they will have to discuss with those concerned. But I must say that the object of the exercise is that the pension arrangements in all sections shall in no way be worsened. There may be changes. There

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may be changes which are most desirable for the public sector or for any other occupational scheme members. There may be a choice of interest—the type of provision for widows. It is unlikely that any lump sum arrangement will be changed, because under the State scheme there is no provision for a lump sum. As for the position of women generally, I can assure the noble Lord that actuarily they have been taken fully into account; and under the State scheme their retirement age still remains at 60.
LORD LEATHERLAND: My Lords, may I then ask my noble friend about the firemen, policemen, et cetera? He told us that when they retire at, say, 55 they will be guaranteed a pension at least as good as that which they get now. Will they draw that pension when they are 55, or will they have to wait until they are 65 before they actually put it in their pocket?
LORD SHACKLETON: My Lords, no: they will be able to draw it. That is the essence of its being as good as they would get at present. Many of them may not retire completely, in the sense that they may go on working. The fact is that they will draw their pension.
LORD LEATHERLAND: My Lords, my next question is with regard to the universities' federated superannuation scheme. Is that likely to be affected in any serious way? Finally, can my noble friend tell us about the investment aspect of this scheme, which I think has already been mentioned? At present, pension schemes, particularly those in local government, invest a considerable proportion of their accumulated funds in industrial equities. Will this Government fund be restricted to investments in gilt-edged? If so, the flow of money into industrial investment will be quite seriously affected.
LORD SHACKLETON: My Lords, I think my noble friend is beginning to take a little advantage of the freedom of this House, and I ask him to wait until he has had a chance of reading the White Paper. I have already dealt with the investment side, and I do not want to get drawn into the kind of investment which may be done by the State. Indeed, I should have to wait for my noble friend Lord Mitchison to participate on that. I
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am not sure what was the other point that my noble friend raised.
LORD LEATHERLAND: My Lords, I asked about the federated superannuation scheme.
LORD SHACKLETON: My Lords, I think I will leave that until another day. I must stress that the essence of the arrangement is that it is not for the Government to lay down; it is a matter for discussion and negotiation between employers and employees, and I am sure that all wise employers will see that there is full consultation. Inevitably, however, when the State scheme comes into payment, at the age of 60 for women and 65 for men, it will be necessary to provide some form of assimilation. Otherwise, there could be over-provision and the employee would be paying more for his pension during his working life than he would want to do. So there will need to be careful discussion. I agree that it is going to involve a lot of work for people.
LORD DRUMALBYN: My Lords, may I trespass on the time of your Lordships just to ask two questions to put the matter into perspective? The importance of occupational pension schemes is tremendous, and while the noble Lord is quite right in saying that half the population are not covered, I would ask him whether he is aware that only one third of the male employees are not covered by occupational pension schemes? Incidentally, may I say that I hope that he will at least get his national insurance pension? He is a pensioner himself to that extent.
To sum up, so far as contributions are concerned, am I right in understanding that the contribution of those who are contracted out will be abated from 6·5 to 5·2 per cent. each side? And am I right in thinking that that applies only to earnings up to one and a half times the average national earnings, and that the employers will have to pay the full 6½ per cent. on all that is earned over that national average?
LORD SHACKLETON: My Lords, I was referring at that moment to my position in relation to occupational pension schemes, and I should point out that Ministers are not even entitled to take part in the graduated pension scheme—we are a very hard-done-by lot. As to

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what the noble Lord has said with regard to the contribution rate, if he has worked it out I have such respect for his acumen and accuracy that I should be very surprised if he was not right. I should be unwise, even with him, to confirm precisely the figures, but I shall examine urgently what he has said and make sure. I tried to write it down. I think he probably is right, but I really must look at the figures. I am sorry that I can say no more at the moment.

ADDRESS IN REPLY TO HER MAJESTY'S MOST GRACIOUS SPEECH
4.34 p.m.
Debate resumed.
LORD CROOK: My Lords, as the noble Lord the Leader of the House has said, it is a tradition to congratulate a speaker who has given us an excellent maiden speech. I offer my congratulations not merely because of tradition or because it is the habit of the House, but as one who has been 45 years in industrial relations. The noble Lord, Lord Stokes, brought us a breath of fresh air, and I hope he will not restrict himself only to speaking on the factory floor and the board room floor. I hope that he will come to the Floor of this House and give us the benefit of his wisdom on every appropriate occasion.
I intended to refer only to the forthcoming legislation on accidents, but I should now like to congratulate the Government, since the noble Lord the Leader of the House has referred to two matters of great importance to me, to which I have devoted some considerable time. For 25 years, from 1925 onwards, I was a member of the National Whitley Council Staff Side and the equal pay committee. But having taken part in the discussions in the National Whitley Council which led to equal pay in the Civil Service, I have since wondered whether I should get to another place before I saw legislation to produce equal pay in this country in general. I congratulate the Labour Government to-day on their intention of introducing this, and I also congratulate them on their timing. They were able to put it into the Queen's speech immediately before the fiftieth anniversary of the I.L.O., and we all went to Lancaster House feeling very much
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happier that another convention, which had hung fire for a long while, was going to be signed. May I also say how much I appreciate the way in which the Government, the noble Lord who is the head of the new Civil Service Department, and the Prime Minister, have got on with the job of organising that Department, and of studying and trying to carry out the better parts of the Fulton Report.
I want to say something about accidents, and I make no apology for the fact that, during the 22 years that I have been in this House, I have been trying to force the attention of Parliament and the country to the grave problems which are being so much forgotten and neglected. I think that, in his speech on my Motion which we debated here, the noble Lord, Lord Shackleton, uttered two sentences which show what a problem accidents represent. He said:
"One wonders how society can tolerate this running sore on our industrial life, for which we pay a very heavy price in human suffering, and the hard economic factor of lost production."
He added, I think rightly,
"…I think that people in future ages will look back with the same astonishment on this age as the astonishment with which we look back on the circumstances of the Industrial Revolution."'
The way in which we take things for granted in this country is most astonishing. This loss of life, and this suffering and misery of people and their dependants; this tremendous loss of production; the waste of our medical power; the waste of our beds in hospitals—all seems to be forgotten. We react everywhere—in the Press, on our television, in both Houses immediately there is a train accident or a plane accident, or immediately two people are killed on a level crossing. It is quite right that we should do so, but what we should try to remember is that every day in the week throughout the year two people are dying in industrial accidents.
Every time there is a strike, someone will ask questions in Parliament and, quite rightly, we will have debates in one or other or in both Houses. There will then be talk about the great loss of productivity, but accidents are causing far greater loss of productivity than any strikes. The last year for which figures are available show—I quote from Hansard of January 20, 1969,—that the

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number of work days lost through industrial accidents was 24 million, while the number of work days lost from strikes during that same period of time was only 2½ million. My Lords, 625 people died in industrial accidents in factories last year, and a considerable number in addition died in offices and shops; 313,000 people had accidents in factories and there were over 20,000 in shops.
I am not quite clear, from what the noble Lord the Leader of the House said, about what legislation we are going to get in this House, and that is one of the subjects to which I want to address myself. A short Bill was promised by the right honourable lady in July last, but there is the longer and much more important Bill which was first circulated in draft 18 months ago, and there is also the outstanding undertaking that an attempt will be made to amalgamate the Factories Acts, in general, with the Act of 1963 on Shops, Offices and Railway Premises. I hope that we shall not get only the short Bill, and that the long Bill will not be put off once again. I understood that it was not in the gracious Speech last year, because of the time needed for the preparation of this kind of measure.
I imagine it is quite clear that the promise given in July of the short measure covers the joint committees. I and some of my noble friends on this and on the other side of the House have debated again and again the complete failure of voluntary effort. I for one have stood in this House and have urged that voluntary effort should be relied upon in the first instance, but we have now reached the stage where voluntary effort has failed. The report which the Minister issued recently says that there are
"still large gaps due, for example, to apathy, general lack of co-operation between employees and employers, or genuine belief that some alternative was more effective".
It was in 1965 that the then Minister of Labour said that if things did not get better we would have legislation, and I hope that that is what will be involved in the Bill that we see.
I hope, too, that the short measure, if it is only the short measure, includes some quite strong action about fire risks. I am not going to keep your
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Lordships by rehearsing all the details of that shocking event in Glasgow, which we all know about; and I know that the right honourable lady the First Secretary gave instructions that high fire risk factories should be inspected at least once a year. But inspection is only one thing. I am quite clear in my own mind that the legislation needed must include very much heavier penalties, and penalties of quite a grave kind, on those who are responsible. I am also quite clear that there must be co-operation between the employers and the workers on this question, and that the employers must face up to their responsibilities. For instance, I was amazed to read the recent statement of the Chief Fire Officer of Coventry, Mr. Leese, that Coventry's four-year research project into industrial fires is being abandoned because of, he said, a lack of real interest on the part of the management. He said in his report:
"It is obvious to me that management are paying only lip service to the problem and are not using managerial talents to solve it."
I hope that we are going to be very firm about this.
I also hope that in the amalgamation of the two Acts we shall bear in mind that these risks are present in offices and in shops. Four weeks before the Glasgow fire, which had so much television and Press coverage, there took place not very far from London—in Chesham, in fact—a fire in a supermarket belonging to a famous firm. Five employees were trapped inside the storeroom in which they were working, behind windows which had iron bars that were padlocked. There were no means of escape such as had been certified by the authorities; the security door was padlocked, and the key was missing. It was only by the Grace of God that because there were workmen nearby with tools who were able to cut through the iron bars on the windows the people managed to be got out before they were roasted alive. I am glad that the judge who dealt with the matter inflicted a fine of £660 and full costs on the big firm concerned.
My Lords, supervision of shops and offices under the 1963 Act was left to local authorities. Some of us had our doubts about this then, although we did not know the right answer. I for one was very glad to see the Government

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of the day bring in the Bill, for it was better to have a Bill and to get something going than to have nothing. We certainly have got something going, and we have learnt a lot in the last four years. It was obvious to most of us at the time that local authority supervision would not be good enough. There are now three-quarters of a million shops and offices which have been registered, with 7½ million employees, and it is true that nearly all of them have been inspected once in four years; but not quite all, even now. The truth is that there are 1,378 authorities responsible for administration, and they all have different standards. They have such different standards that it is possible for the manager of a great firm like Marks and Spencer or Sainsbury's to agree a particular standard for one of their shops with the local officer who is inspecting and to go into production (because good firms always agree to do anything which is wanted), only to find that in the next county or borough the authority in question says. "That is not good enough for us; we do not want that, we want something quite different". It has even reached the stage that some people who are making some of these things are beginning to wonder whether we have gone out of our minds.
However, it was a good Bill which, when it became an Act, proved to be a good Act. It was the provisions for inspection which were wrong, and the Ministry of Labour as it then was, or the D.E.P. as it now is, have admitted this. If one looks at the Report of the Royal Commission on Local Government, one sees that they said in evidence quite clearly:
"The only conclusion … to be drawn … is that despite all advice and guidance, both quantitative and qualitative, uniformity of enforcement by local authorities is an unrealisable ideal".
Later in their evidence they said:
"It is a ground for general criticism that an Act which provides safety, health and welfare protection for all office and shop workers should vary in its application according to the degre of enthusiasm of the enforcing authority".
It is that to which I direct attention in respect of whatever Bill we may get.
As to the inspectorate that we have, let us grasp one nettle immediately by saying that we have not got enough inspectors. We have always been saying
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that, and always we have received the same reply. It is repeated in the new report which has just come out: that is, that there are still not as many inspectors as are provided for in the establishment; that we are still not recruited up to the number authorised. This year, the Chief Inspector said that improved starting salaries and the introduction in 1969 of an alternative method of entry for well-qualified older candidates with industrial experience had not remedied the situation. Of course, it was not for him as Chief Inspector to go on to say what I can say and what other Members of this House can say: that a very good reason why you cannot recruit inspectors is that what you offer them as starting pay—and, indeed, even after five years in a responsible job such as this—is less than the dustmen were prepared to settle for in their recent strike. How can you expect to have a factory inspectorate up to strength in such conditions?
Even if the authorised number is reached, I think that number must be increased. That is one thing that must come out of this Bill. I was very glad to see that my right honourable friend the Prime Minister said in a Statement in another place that he thought the only answer to these problems was to have more inspectors. He also pointed out that it was no good in one breath saying, "Let us have more inspectors" and then in the next breath saying, "But, of course, we must not have any more civil servants; we must keep the figure down". The plain truth is that if there is one field in which more civil servants are justified it is in this one.
My Lords, there are many speakers to follow. There are many more aspects of this problem about which I should have liked to say something, but I shall have further opportunity on the various stages of the Bill, whatever it is. I shall be able either to suggest Amendments, if it is something that can be amended, or if something has been left out I shall be able to get up and grumble that it has not been put in. Whatever form the legislation takes, I hope it will go some way at any rate towards the proper realisation of that which some of us have been pressing for so long; that is, a proper understanding in this country that the only capital possessed by

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most workers is their lives and their health, and that they are not expendable in the interests of their job.
4.49 p.m.
LORD BROUGHAM AND VAUX: My Lords, I should like first to thank the noble Lord, Lord Shackleton, for his very kind remarks. Unfortunately, he is not here at the moment, but no doubt a message will be passed to him. I should also like to congratulate the noble Lord, Lord Stokes, on his very good speech. I only hope that I can do as well as he did. I beg the indulgence of your Lordships' House to intervene in this debate to make my maiden speech, and I am honoured to be able to take part in this general debate on the gracious Speech. As is the custom, I shall not speak for too long.
The subject of your Lordships' debate to-day is directed to economic affairs, with special reference to industry and industrial relations. As industrial relations is a very controversial subject, and as a maiden speech should not be controversial, I shall refrain from making any comment on it except to say that I believe that before this country can pay its way something must be done—and soon—about all these unofficial strikes and disputes on safety. I shall say no more on this subject as many noble Lords are better qualified than I am to speak on it.
The gracious Speech made reference to an agricultural expansion programme and also to achieving a better balanceof-payments surplus. I feel that these two go hand in hand. In other words, we should grow more and import less. The agricultural industry should have been allowed to expand at a much quicker rate than it has done. During the war it had to expand to meet the demands of the country, and it did so to the best of its ability. Since then it has not expanded in proportion—or so I believe—with the result that there is more imported produce than home produce on the market. I should like to see—and so, I am sure, would those noble Lords who are in the industry—more home produce on the market. This I am sure could happen, because we in this country are fortunate to have an enormous amount of scientific knowledge, experience and know-how which is waiting to be un-
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leashed and so increase the present output and thereby reduce imports.
I give one example—corn. A farmer who wants to sell his corn at a profitable price cannot do so, because the grain stores are overflowing with imported corn. It is partly because of this imported produce and because of these completely unnecessary strikes, fortunately not in the agricultural industry, that this country has got into its present state. Finally, my Lords, expansion of the agricultural industry would not only relieve the country of a very heavy burden, and give relief to the farmers; it would also give them a much better margin. Moreover (and this is just as important), the farmers would be more willing to pay the farmworkers the realistic wage which they so rightly deserve for the very good job that they perform in all weathers.
4.53 p.m.
VISCOUNT WATKINSON: My Lords, it is first my pleasant duty to congratulate the noble Lord who has just spoken in this House for the first time. I do so very sincerely. I think he sets us all an example in saying what he had to say clearly and quickly, and I very much hope that we shall hear him often. I reflected, while he was speaking, that whatever differing views there may be in this House on the hereditary principle, surely it will be a very sad day for all if we do not get a system that enables people of somewhat younger age (if he will allow me to say this to him) to come to this House to bring the freshness and direct approach of youth. I should also like to say a word about the maiden speech to-day from my old friend Lord Stokes. I think it is a very good thing for this place occasionally to have somebody hot from the industrial battles to come and tell us very straightforwardly and clearly what goes on and what ought to be done about it. I hope that the noble Lord's many preoccupations will not keep him away from this House entirely and that we may from time to time have the great benefit of his advice "straight from the horse's mouth".
The only comment that I should like to make on his speech—I think I agreed with everything he said—was that the picture he painted presents the Government with a very great and difficult challenge. I should have liked to take up this point

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with the noble Lord the Leader of the House; but I understand perfectly why he is not here. I think we all have to accept that if this House is to attract people who have other jobs to do, then from time to time they must go away and do them. None the less, 1 must say—and I hope that he will forgive me for saying it in his absence—that I was rather surprised that in a speech from a leading member of the Government nothing was said about this most difficult problem of industrial relations that the noble Lord, Lord Stokes, rightly brought to our attention.
That problem is certainly not confined to the motor industry. All of us who want to see our country prosperous must be increasingly alarmed at the rising tide of unrest—I almost said "anarchy"—that is sweeping through the factories of Britain. Although there are bad employers and perhaps bad trade union leaders, although we have to do what we can to manage our own affairs as well as we can, and although the C.B.I. and the T.U.C. have their duties to perform, if this situation menaces the nation's economic progress—and many of us think that it is doing so—then nothing absolves the Government of the day from the duty to deal with it. Therefore the proposals that I wish to make as briefly as possible must inevitably be aimed at the Government—because they have the reins of power and I believe that it is their responsibility to act.
The Government have tried to act; but it is only reasonable to say that they have in fact made industrial relations much worse by getting involved in a head-on collision with organised labour and then retreating the moment that the real battle was joined. In industry we must now cope with the troubles that face us and that flow from this situation. We will do the best we can; but we have to face a very difficult situation on the shop floor and in our relations with trade unions who appear to have increasing difficulties in keeping control of their members.
The gracious Speech said that the Government are going to bring forward a measure to improve industrial relations. I hope that they will at least have a major re-think about the subject before they bring that measure forward and will try to tune it more accurately to the facts
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of the situation; and, having said what they will do, I hope they will stick to it and do it. I must say again that it would be quite wrong and unfair at this moment to put the responsibility for solving this problem either on to action by the employers or on to action by the trade unions, or even on to action severally and jointly by the C.B.I. and the T.U.C. It is the Government's problem.
As a young Minister, I had the privilege for four years, as perhaps one or two Members of this House may remember, of being involved in a very different approach to industrial relations in a Ministry, incidentally, that regarded Mr. Ernest Bevin as one of its greatest Ministers and a Ministry which, in my day, was under the very able, very sympathetic and great leadership of the late Lord Monckton. I hope that in my putting forward two concrete suggestions it will at least he accepted that I put them forward from a basis of some knowledge of what goes on in industrial relations both on the Government side and over a fairly broad range of British industry.
The first task in this situation of any Government who mean to do their duty by the British people is to revise the legal code which governs the operation of the British trade union movement. I do not think that any of us in industry who have to face this problem can really burke that issue. I hope that I choose my words carefully: I say "revise". The trade union movement is not outside the law of the land; but it is at present governed by a legal code which was designed to deal with the situation of the 19th century rather than the 20th century.
We all know—some of my old friends in the trade unions know and perhaps will agree—that all the old historical battles of the past have long ago been fought and won. We no longer have employers who regard their employees as chattels to be exploited or locked out as circumstances might dictate. Thank goodness, we do not! We no longer have the mass unemployment of the 'thirties. Thank goodness for that! Some of the mythology of those events still remains; but surely the practicalities of the present situation require an impartial re-examination of the trade unions' legal position, particularly in regard to safeguarding the

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rights of individual members of trade unions. For example, it is at least arguable that some impartial body—perhaps the Registrar of Friendly Societies—might be given the duty of making sure that union action is taken only in accordance with the wishes of the majority of the members of the union. I think, too, that the noble Lord, Lord Stokes, and I do not seem to disagree on this.
These and many other proposals, my Lords, are regarded by the trade unions as being controversial. It might be helpful, therefore, in this situation (I am trying to make concrete proposals, and not merely to propound a number of criticisms) for the Government to say, as in my view they must, that they accept the need to revise the legal framework in which trade unions work, but that they do not propose to enter this area of controversy as final arbitrators. The way out, surely, is for the Government to make their proposals clear and precise and then to put them—after all, it is a legal problem—to the test by obtaining the best legal advice available as to the fairest and most workable means of solving the problems.
I do not suggest the setting up of another Royal Commission, but that the Government should make precise proposals, and then ask the legal profession to examine them impartially and try to make them into good and reasonable law. This might not take the issue out of the area of controversy, but at least it would have the advantage of making a solution legally workable; and of making it fair and seen to be fair. It would also avoid some of the many difficulties which, as many noble Lords are no doubt aware, have arisen from trade union legislation both in the United States and in Australia.
Having secured an impeccable and up-to-date legal background for industrial relations, the Government must stand firm, and see that the law is enforced in this connection in the same way as it is enforced in respect of any other citizen of the land. I hope that it will be thought a constructive suggestion when I say that the Government are much more likely to succeed in doing this if they do not confuse their economic policy with the task of seeing fair play in industrial relations. When I served in the old
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Ministry of Labour it was not an economic Department; our job was not to impose economic doctrines in the form of wages or price policies. The work of the Ministry was cast in as non-controversial a role as possible. It sought to provide a service; to conciliate; to ease friction; to resolve disputes. In other words, it tried to act as an impartial referee, even when the game got rough, as it did, and as obviously it always will.
What I am trying to say, my Lords, is that if the Government re-write the rules of the game in industrial relations on the best impartial legal advice they can obtain—as I believe they must—they have an equal responsibility to provide an impartial and fair referee; one who is known to be impartial, and who will see fair play in the national interest. Such a man must clearly be a Minister; for this certainly cannot be done by a committee or an outside body. Moreover, he must be a Minister in the Cabinet—although one might hope that he would not be the most controversial member of the Cabinet.
He should be armed with the right to intervene whenever he or his advisers judged it to be necessary. Here. I believe, is another important point. The old convention of the Ministry of Labour—and, as I understand it, of the present D.E.P.—that you do not intervene in unofficial disputes, really must be abolished. Of course there cannot be an aura of "peace at any price" in this sort of intervention, but where the Ministry felt, as it might feel in an unofficial dispute, that it could not achieve a settlement without putting undue pressure on a company, or for that matter on a trade union, it should be given the very important task of exposing the facts of the case to the public and to the Press, and thus to the country as a whole.
The Ministry should have a statutory duty to investigate unofficial disputes in this way. I think that to-day, if it had that duty, some very strange and twisted stories would arise as a result. No doubt from these stories public opinion could form a view, and would thus be able to exert a more acutely aimed influence on any particular dispute, and perhaps, in the end, enable the Ministry to get a fair settlement in the public interest. The Ministry would be operating against the

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background of this new code of legal practice. Whatever the law, I am quite sure that if it is to work it must have the hacking of the public. And public backing cannot be given unless the facts are known; and, as many of us know the facts of many unofficial disputes are very disagreeable, and very much against the public interest. In many cases, however, they cannot be exposed because there is no impartial body to examine the matter and to put the facts before the public—or, indeed, before some of the chaps who are themselves involved.
The noble Lord, Lord Shackleton, talked about the new super-Board to be formed out of the Monopolies Commission, the P.I.B., and the rest. I pray that this Board will have no responsibility whatsoever for industrial relations. If it does, industrial relations will be worse and not better. I want to say again that a Government must not mix up their economic policy with the task of seeing fair play and getting reasonable conciliation in industrial relations, which are better dealt with on the shop floor than in scenes of great drama in St. James's Square or, even worse, in Downing Street. When they come to national level, surely they will be better solved by the kind of procedure that I am advocating. This Ministry of Labour in its re-formed state would have need to be quite small. It would need an expert staff, and it would need to have the kind of people who can investigate an industrial dispute, official or unofficial, and see that the truth and the facts are known.
Those, my Lords, are my proposals: that a new code of legal practice should be constructed in as non-controversial a way as possible; that the Ministry of Labour should be reconstituted under a Cabinet Minister; that it should work within this legal code; that it should have the right to intervene in unofficial disputes but primarily should have the duty to dig out and present the facts. And certainly it should not apply pressure on trade unions, or on employers to give in to those in the trade union movement who are seeking disruption rather than agreement and efficiency.
The last thing I want to say is this. I have talked a certain amount about the public interest. What is the public interest in this regard? It is—and I think that other noble Lords who are engaged
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in industry may agree—to see that these senseless battles on the shop floor are stopped because, after all, the only people who win these battles are our foreign competitors. They are very happy to take the orders that we cannot fill because we are too busy arguing about some unofficial strike problem instead of getting on with the job of producing our goods and selling them. Nothing gives you a worse name than failing to meet your delivery date, and nothing is more likely to cause you to fail to deliver to a foreign customer than this sort of industrial disruption on the shop floor.
What advantages would this plan show to employers and workpeople? I have never believed that the trade union movement was right to be afraid of a new code of legislation; and I would say that the trade union movement needs the backing of such revised law as much as the Government, employers, or the nation as a whole. Another point that I would draw to the attention of my trade union friends (I sometimes regret that so many of them are now colleagues of mine in your Lordships' House and not still fighting the battle), or to those of them who have any cause to fight the battle, is this. If the trade union movement would come together and agree a proper code of legal behaviour and practice, and would back it, they would then have the right surely to get a much larger membership, something much nearer 100 per cent. of the working population of this country. That I believe would be no bad thing if only we had the situation put into a proper framework and into proper perspective. So, my Lords, in my view there is a great deal in this for the trade union movement; there is a great deal in it for the employers, who ought to be able to get on with their own jobs and not be faced with this sort of industrial anarchy.
Finally, I invite your Lordship's to imagine a first-class game of soccer where there is considerable doubt about the rules, and no referee at all. Yet that, I believe, is the sort of situation in which we in British industry are asked to go ahead and increase our exports, and to do all the other things which for the sake of our country we ought to do. I believe that it is the job of the Government to put a stop to that situation, and to do so soon.
5.10 p.m.
LORD TAYLOR OF MANSFIELD: My Lords, like the noble Viscount who has preceded me, I should like to offer my congratulations to the noble Lords who have made their maiden speeches to-day. One of the remarks made by the noble Lord, Lord Stokes, caught my imagination. The noble Lord, who is head of a large firm, employing many thousands of people, spoke about the complications and technicalities of modern industry and ended up with the phrase, which I thought was wonderful, "It is always people who matter". If both sides of industry can take cognisance of that and of the spirit that is behind it, industrial relations in future would be much better than they have been in the past.
I have listened to many of the speeches during the past three days of debate on the gracious Speech. They have covered a wide front in the domestic and international fields and many important matters have been raised, but the topic which we are discussing to-day as the epilogue of the debate—industry and industrial affairs—is as important as anything which has been brought forward since we began last Wednesday. I am pleased to note in the gracious Speech that:
"Provision will also be made for certain reforms relating to industrial safety and health."
It is to that part of the gracious Speech that I want to address my observations.
The possible hazards to health arising from present day industrial processes need our consideration and cannot be ruled out as unimportant. More and more attention has to be paid to those whose health has been impaired, and is likely to be impaired, by these processes, for this impairment vitally affects the individual. First of all, it affects his working capacity and, as a consequence, his standard of life. Many of the people to whom I have spoken throughout the years profoundly and sincerely believe that the diseases of which they are victims arise from the nature of the employment in which they have engaged over a long period of years.
My purpose this afternoon is to talk mainly about respiratory diseases. I will mention only three of them: pneumo-
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coniosis, emphysema and chronic bronchitis. There is a great deal of evidence on record that these three diseases are a direct result of industrial processes. May I quote the example of a man who starts employment physically perfect and with a healthy pair of lungs but who, after working for years in dusty conditions—and some of us here have had experience of this—arrives at a stage when his breathing becomes difficult. He feels that his health is completely impaired and it is difficult to convince him that this condition has not arisen out of the employment in which he has been engaged. I am not a doctor and I do not know much about the human anatomy, but when this type of case arises there is no dispute in the field of medicine about the condition of such a person's lungs and breathing apparatus, although there often arises a difference of opinion about what disease such an afflicted person is suffering from.
Let us assume that a person is suffering from an occupational disease such as pneumoconiosis. That person is entitled to draw benefit from the industrial injuries fund. But if he is certified as suffering from emphysema, which at the moment is regarded as a non-occupational disease and is not a prescribed disease added to the existing schedule, the benefit that such a person would draw would be sickness benefit from the National Insurance Fund. The difference between the two is rather large—and I am going to argue the desirability of uniformity.
I am not unmindful of the fact that there have been great improvements in this field during the last forty years. If I may, I should like at this stage to give an example. Let me take the disease known as silicosis, which was added to the schedule in 1928 but with the restriction that although a man was medically certified as suffering from silicosis, it had to be proved that there was a percentage of silicon in the strata in which the man had been or was working before compensation under the old Workmen's Compensation Act was payable. Happily this is no longer the case. I think it is appropriate here for me to pay tribute to the late Lord Ingleby. I remember when, as Mr. Osbert Peake, in the Coalition Government in 1943 he was Under-Secretary to the late Lord Morrison, then Mr. Herbert Morrison. In this field he,

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together with Herbert Morrison, had a very liberal outlook, and a great deal was done at that time to remove the restrictions so far as affliction to the lungs was concerned.
In this connection, I am not unaware of the argument that is often put forward by the medical profession. They say that emphysema, for instance, is a hazard common to the general public; that apart from those who work in dusty conditions and are subject to industrial diseases, anybody can get it. But my belief, as a humble layman, is that people working in dusty conditions are more likely to become victims of not only pneu-moconoisis, which is prescribed, but of emphysema which is not.
Let me take two men working in the same conditions—and, so far as the coalmining industry is concerned, they may have worked together for years in the same working place. The breathing of both becomes impaired and difficult, and they become limp and ill. What happens? They both go to their local doctor, and he says: "Look here, boys, my suspicion is that your lungs are affected by the inhalation of dust at your work." He is not the final arbiter. He suggests that they go for an X-ray, which they do. The X-ray may reveal suspicions that there is something there. They then go to the Pneumoconiosis Board—this is not exceptional; it very often happens—and one of them is certified as either totally or partially suffering from pneumoconiosis. From the point of view of benefits, that is all right, because that man can go on to the industrial injuries fund. But they may say to the other fellow: "Your lungs are badly affected by dust. However, our diagnosis is that you are not suffering from pneumoconiosis, but from emphysema." By comparison, the one who is suffering from emphysema draws sickness benefit, which is much less than his mate would draw as industrial injury benefit.
If this happened to miners the financial position would be worse, because the mining industry is the only industry in this country (I regret to say this to some of my trade union friends here to-day) that took advantage of that section of the Industrial Injuries Act 1946 to institute a supplementary scheme, which means added benefit for those who be-
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come the victims of an accident or disease.
I came to the conclusion long ago that the prescription of emphysema is long overdue, and that it should be added to the schedule of industrial diseases. I had a document put into my hand this morning. I have not had time to go through it in detail, but I should like to read to your Lordships a short paragraph. It says:
"The case for including chronic bronchitis and emphysema as part of an industrial disease rests in the end, as we have stated before, on social and moral grounds rather than on medical research. Nevertheless, such research, particularly associated with the name of Professor Gough …".
Here I should like to pay tribute to Professor Gough of Llandaff Hospital in Wales, who has done an immense amount of work in this field. He has suggested that certain forms of medicine at present excluded under British legislation are occupational, and are indeed regarded as such on the Continent. I hope that when my noble friend conies to reply he might give us some assurance that this is being looked at as closely as possible, with a view to emphysema being included in the schedule of industrial diseases.
I now want to mention something that I raised in the other place, and have raised here before now, that is, the disease (I wish they had a different name for it) dupytrens contracture. I have seen many miners with this ailment and affliction. For years these men have been using heavy tools—gripping pick handles and, in these more mechanical days, using vibratory tools as well. This is a disease which is an occupational hazard, but it has not been scheduled. I know it is argued by the medical profession—and I am not arguing against it; I am not competent to do so—that sedentary workers have this as well as manual workers who use the tools that I have described. While accepting medical opinion on this score, that it could happen to anyone in the general community, my own view, for what it is worth, is that people using heavy and vibratory tools become victims as a consequence of the disease known as dupytrens contracture. I would ask my noble friend to urge upon the Industrial Injuries Advisory Council (I believe they have studied it already) to undertake a thorough investigation into this disease.

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I think I have gone on long enough. I wanted to say something about the latent compensation cases. I will not go into detail about this, but I should like to say that there are still many who were injured long before 1948, and up to 1948, who are partially disabled. All the other categories, the time-barred pneumoconiotics, the total disabled, and even the partially disabled, receive some weekly sum under the old Workman's Compensation Acts. All Governments in this post-war period have made improvements in their lot, but what is left is this remnant of what we call the latent cases. Time forbids me to go into this matter, but I would ask my noble friend, in addition to looking at the methods to which I have specifically referred, whether some further attention and thought can be given to these latent compensation cases. If something is not done soon, the calendar will solve the problem, because these people are getting older. What they think, feel and say is that they are the only remnant left, and they are like the lost tribe. Because of that I hope that something will be done.
5.31 p.m.
THE EARL OF PERTH: My Lords, I was one of the people who was not able to be present yesterday for the first part of this debate on economic affairs, as I had to be up in Scotland. Several of the points I want to make to your Lordships would be more appropriate, perhaps, to yesterday than to-day since today's debate is mainly on industrial relations. However, I have in mind to touch on industrial relations in one particular aspect. Before I do that, I should like to join so many other of your Lordships who have spoken in congratulating the two maiden speakers, and particularly the noble Lord, Lord Stokes, who, with his unrivalled experience of industrial relations, said so many things which to me in every way seemed to ring a bell. Something that struck Lord Taylor of Mansfield also struck me, when Lord Stokes said that in the end it is always the people that matter. Clearly the question of good relationships between the worker, the union and the employer is without question the most important matter we have to face to-day. If we can only get that right, then we need have no real worry for what lies ahead.
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I believe the blame for the troubles is at least as much with management and with trade unions as it is with the workers. I am always struck by the fact that when the workers come out on strike it very often is something which cannot be easy for them to do. It shows loyalty to their fellow workers, but the strike is often due to their being misled about things. So often it is a failure of the management or the trade unions to communicate; and that is one of the points which the noble Lord, Lord Stokes, made—failure of communication. It is failure of communication to-day partly because of the size of many of our great industrial units. It is a very difficult problem, but it is not an impossible one. May I give your Lordships one example of a case about which I know? A big company embarked on one of the most difficult of all tasks; namely, to close down one factory, and bring three shifts on to another one which was situated nearby. The company took that as a policy decision, and for a period of two years worked with the top people in the trade unions on how to put that decision over to the workers. They worked together on all the questions with regard to the right pay to give, what should be done about redundancies, and so forth. As I say, this took them a period of two years, and they were working, naturally enough, in secrecy.
When they came to an agreement on these matters they had the problem of how to communicate. This—and perhaps it is a bad analogy—was like a military operation, in that over a week-end they told the foreman what they proposed to do, and on the Monday collected all the workers of the factories together—there were some 3,000 of them—and addressed them in parties of never more than twenty. So each party of twenty was able to hear the reasons, the whys and the wherefores, of what was proposed. Of course, there was a certain degree of upset among some of the workers and there were those who worried about what it all meant for them. There was a moment of anxiety as to whether the decision was going to succeed, but it did, and the result to-day is to the benefit of all. The only reason I have told your Lordships that is because it is an example of the importance of communication down to the smallest possible scale—not

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more than twenty people at a time out of a total of 3,000, each being told what it was all about. As the noble Lord, Lord Stokes, said, it is always the people that matter.
The second point I want to touch on is something which has nothing to do with industrial relations but rather the prospect which faces us all in the 'seventies of a rise in the cost of living which will make the days which we are experiencing at the present time, or which we have experienced over the past ten years, look like the "good old days" and make us wish in the future that we could have something as reasonable and as limited as we are experiencing now. I say this because there are certain built-in factors for this rise in the cost of living in the 'seventies, and if we are not extremely careful nothing will be able to prevent them from operating. What are those factors? The first which occurs to me is that of decimalisation. I am convinced that we made the greatest possible mistake when we decided to have a pound of 20s. rather than a unit of 10s. No other country which has made the change has made that mistake. I have seen it estimated by the most reputable economists that the sequel to this will be an inevitable rise in the cost of goods, generally of anything from 10 to 20 per cent. Those are almost incredible figures if you think of the process of evening-up every time. You may say that it should be a process of evening-down, but that is not human nature. You will always find very good reasons why you should even-up. What can we do about it? I do not know that we can do very much, for I suppose it is too late to put the clock back. I beg that the Prices and Incomes Board, or whoever may be the watchdog on these things, should be strengthened to the nth degree, to try to stop this almost inevitable evening-up.
I would also ask whatever Government may be at that time in power not be too doctrinaire about it all. I have particularly in mind when I say that the abolition of the sixpence. That was a purely doctrinaire decision by somebody with no good ground—economic or otherwise—for it. Let us think what is going to happen. By that time the price of all the popular newspapers, for example, will be sixpence. What are we going
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to do about the parking meters? Those now take a sixpence or sometimes a shilling or two shillings. But we shall no longer have the sixpence, and I disagree with the people who say that it will not be very expensive to change the meters. It will be expensive to change them, and they will be evened-up, as opposed to staying as they are or going down. So please try to be not too doctrinaire, and do not make these decisions which have no good rhyme or reason.
What is another built-in factor for the 1970s? It is, I hope, that we shall join the European Economic Community. I say "I hope" because I am all in favour of it, but we have to realise that this will mean, for example, an increase in food prices. I think the counter benefits will far outweigh this, and there ought to be reliefs in taxation because, after all, certain of the subsidies will no longer have to be paid. All the same, here is another built-in factor. Then there is, as we know, the question of equal pay for women. I am not against this. but let us be quite clear that this again is an inflationary factor, and how it is to be handled is something requiring great thought and great care. Let us hope that our general prosperity will be such that we can take it in our stride. What else? Well, there are the latest plans for increased pensions and insurance payments. We all know what happens in matters of this kind. Somehow or other they become involved in the next round of wage negotiations and prices go up. Again, I believe that these proposals, good in themselves, are one more example of built-in factors for the 1970s.
One last one, which has not yet been announced and which I hope does not come off, is a proposal that we should go on to the metric system. I am told that if and when this happens it is going to be enormously expensive to us all, and, so far as I am aware, there will be no very obvious benefit. If to-day we were on the metric system, I can well imagine a situation in which we should be saying, "Oh dear! I wonder whether we could get on to the same system as that in the United States of America. After all, we do so much trade with them and they are such an enormous unit." Let us at any rate wait on this matter until after the 'seventies or until we have got over all the other factors I have mentioned.

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The third point I want to make is not on the question of the rising cost of living in the 'seventies but on the problem of stockpiles. Stockpiles are not very fashionable to-day. There was a time when Governments had them in considerable size, and then for reasons of economy we decided we should run them down. At the moment this policy is facing us with one of the most serious industrial problems and crises we have had for a very long time: I refer to the crisis of the shortage of nickel. Our total strategic stockpile of nickel at the present time is some 1,500 tons. I am not blaming this Government, I am blaming Governments as a whole, for having run down on certain strategic materials upon a supply of which our whole industrial wellbeing may depend. When it came to uranium, Governments acted wisely. They foresaw that they had to be sure of having a stockpile of uranium when we entered the nuclear age and were basing more and more of our power plants on uranium, and Governments made long-term contracts to ensure adequate supplies. But we have run down on almost all our other strategic materials, and I ask the noble Lord, Lord Delacourt-Smith, who is to wind up, whether the Government will give special attention to this problem again in certain fields where we are so much dependent on the action of one single country, which may bring us almost to our knees through no fault of ours.
The only concrete suggestion I have which may help to alleviate this problem at the moment is to get rid of the 50p pieces. I gather that they are made almost entirely of nickel. Let us have some courage and go back and collect them all and put the nickel into a stockpile; and let us have our 10s. notes. It may be difficult, but it would be worth while, and I, for one, would applaud such a move.
Lastly, I must say one word—your Lordships will not be surprised—about Scotland. I want to touch on only one point. Unfortunately I was not here yesterday and did not hear the noble Earl, Lord Lauderdale, speak on the question of ports. It is on this one subject that I want to touch, and I would stress the enormous value to this country of the deep water on the Lower Clyde. In years to come the deep water there will be,
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I believe, not only the biggest asset we have in Scotland for industrial development but the biggest asset of this country. I know that one hears about the developments of Port Talbot or of Tees-side, but those are developments which can be enlarged or continued as they are only by constant forms of dredging, and even now to secure the passage of a 100,000-ton ship is a difficult and expensive thing to do. There is no problem of that kind with the lower waters of the Clyde. Milford Haven was in the same position, but Milford Haven is now fully taken up.
On the lower Clyde there is clearly a great opportunity for a vast steel complex. All the great new steelworks in other parts of the world are deliberately put on the coast for the very good reason that then the ore comes in easily, the power is easily generated there, and so forth. Again, obviously, great refineries are there, and so a great industrial complex is built up. I believe that in the 'seventies this will be perhaps the most exciting development we can have in this country. Of course—and I think quite rightly—the preservationists of the countryside say, "Oh, but—"; and I have great sympathy with their saying that, because this is a question which needs careful study, which is being given. But, in the end, we must go forward with it, and I think we should go forward firmly and quickly, and the benefit not only to Scotland but to the whole of this country will be very great.
5.47 p.m.
LORD THORNEYCROFT: My Lords, I was brought up to declare a few interests which are mostly in the electronics field or telecommunications, in cables and in tyres. I suppose that to that extent I might be said to have a vested interest in the noble Lord, Lord Stokes, as well, because the future of the motor industry is of concern to all of us. But at this stage I would content myself by adding my word of tribute to a first-class maiden speech, and by saying how fortunate I think your Lordships' House is to be able to have a contribution from an industrialist of the first grade right at the top of his job.
I was brought up as a politician; I would count myself now as an industrialist, and I suppose therefore that I see matters a little through the eyes of

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both. But when we are debating industry and industrial relations, I think someone should repeat what I believe the noble Lord, Lord Beswick, said yesterday; namely, that it really is the success of British industry which is going to determine whether we have any success in our economy. I therefore want to make about six points concerning British industry, and when I have made them I will sit down.
The first point I want to make about British industry is this. Its image in this country is not what it ought to be. Few people in this country really understand much of what British industry is about; where it obtains its money from; what is the purpose of profit; how it organises itself, and what contributions trade unions make to both sides of industry when properly worked. To most people in England these matters are a closed book. I am not here to say that the Socialist Government have destroyed British industry. They have not. We stagger on in a way, carrying a substantial burden of taxes and interest rates and the rest; we stagger on, as I say, and even make a modest success. It will be found that we shall be as loud in our praise of moving into surplus as anybody else is. Indeed, I think that most British industrialists will think they have made a modest contribution to bringing us into that position. What I would criticise Her Majesty's Government about, and, perhaps even more than the Government, the Party that lies behind them, is for doing a good deal of damage to the image that British industry has.
I have been reading—because I like to read these things—a pamphlet called Agenda for a Generation, and I opened it with rather trembling hands to see what was in store for us during this generation. I found what was said about industrialists, and I found that I am insufficiently accountable for the decisions which I make. I am told that I am one of the major sources of economic inequality in our society. I am told that I encourage the belief that individual spending, rather than collective spending in the public services, holds the key to rising living standards; and I am told that the new management which is coming along is responsible only to itself.
I do not think it helps—and I feel bound to say this—to treat industry not
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as a matter of high adventure in which all of us have the deepest interest in success, but as some kind of national disease which causes more social evils than it cures. The idea is even held out here that somebody might make some money out of British industry; might even—worse still!—actually keep some money that they make. These horrors are spelt out in detail in this pamphlet. If I may say this to the noble Lord, Lord Shackleton, and to the noble Lord, Lord Delacourt-Smith, who is to reply to this debate, my criticism—if I can criticise what they do—is in regard to the image. It is here that we differ from the United States of America. In this country we have an image where wealth is obscene, where success is almost indecent and where "profits" is a dirty word.
SEVERAL NOBLE LORDS: Nonsense!
LORD THOR NEYCROFT: The idea that, against a background of that kind, one can get industry to take the fullest part that it ought to take is an illusion. So my first point, my Lords, is that all of us, wherever we sit in the House of Commons—I beg your Lordships' pardon, I meant the House of Lords. These little slips do occur: it is the old Adam rising in me—ought to make it our business to try to improve the image and, above all, the understanding of what it is that industrialists are engaged in.
The second point I wish to make is that, contrary to what is said in this pamphlet, we are not too powerful; we are not powerful enough, and we are not efficient enough. I saw in one of the Sunday papers an article on Mr. Arnold Weinstock. Mr. Weinstock may be a controversial figure, but he is certainly one of the stars in the managerial firmament, and at the end of the article the writer said that in his desk he keeps a piece of paper which acts a constant spur to him. On it are the key statistics of two of the big electrical companies, together with those for G.E.C. They are constantly brought up to date. The gap is still so wide, the article says, that Weinstock is unlikely to want to give up for some time yet. I must say that I did not know that there had been any indication that he was anxious to give up, in any event. I would ask your Lordships

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to believe that if that is true of Weinstock, of the G.E.C., it is also true of the great majority of British industry.
There are many ways in which one can judge the performance of British industry: one can see what sales are generated by each man who is employed, or one can test performance on the value that is actually added by each worker employed in any particular business. But there are few industrialists to-day who, putting the figures that we can produce against some of our principal competitors in the United States of America, or perhaps in some cases in Europe, would really say that they are yet happy. The answer to these problems, of course, lies in part, and largely, with management, and we in this country must all use our best endeavours to see that the coming generation of British managers is as highly skilled and trained and as professional as they can be.
But, my Lords, it depends also on investment. I should like the noble Lord, Lord Delacourt-Smith, if possible, to spend a little time in his reply telling us what he really thinks is likely to be the future pattern of investment. The noble Lord, Lord Stokes, drew some attention to the need to replace obsolescent equipment. How? With a squeeze at fairly high pressure, to put it no higher; with wage demands being conceded at what some people would think to be dangerous levels, and the consumer pressures that might come after that, what room will there be for this investment in the new equipment which is absolutely vital?
Success, then, depends on the management; it depends on investment; it depends on markets. And here I would say how much I, too, appreciated the speech made by my noble friend Lord Carrington about Europe and the opportunities that lie there, both for Europe and for this country. I am not going to debate the subject here, but I do know and recognise—and I think most people do—that no small part of the success which has been found both in the United States of America and in the Union of Soviet Socialist Republics lies in the fact that a large market is freely available to them without any tariff barriers whatsoever. I see the gravest difficulty in large-scale British business being able to draw
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the maximum from their resources until they have access to markets of that kind.
So the answer is management, investment and markets. But, my Lords, in my view the answer certainly is not in all this talk about redistributing wealth that has already been accumulated; in the appointment of State directors (by all means put in State directors, but what benefit will this give?), in the introduction of new State Boards. I would therefore ask the Front Bench opposite to use its influence, which I feel sure it would wish to use on the side of the angels, to try to get this discussion about industry. in the Labour Party and nationally, on matters which are at least relevant to the problems that industry actually has to face.
That brings me to my third point, the illusion that shareholders are altogether irrelevant, on the way out and dead, so far as the Socialist Party is concerned. I do not believe this to be true. I know that it is quite a fashionable idea, but I observe that in this document they say:
"In this connection vie shall also review the realm of dividends. The demise of the shareholder"—
They have already buried him. The shareholder is over. They feel that if he exists at all great care should be taken that he does not have any rewards for any success in his company. The idea that his actual wealth, in the form of capital, should grow if he happens to invest in one of our proud corporations is regarded as horrific.
My Lords, it is very difficult for a Government to say that they are wholeheartedly behind British industry if at the same time they launch a direct attack upon equity capital. The two are connected in some way—I would beg your Lordships to believe that. It is partly this utter lack of understanding of the way things work that many of us find a little disconcerting. I would say just one thing more about shareholders. In my life I have seen quite a bit of both public and private business, and if I had to give one reason why private businesses struggle to get profits, and why public businesses, of many of which I am very proud, tend to extravagance and often to losses, I would say that it is because the former have to answer regularly to the owners of the capital. That makes a tremendous

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difference when decisions have to be taken.
My fourth point is about the relations between Government and industry. Whitehall was always a bit of a jungle, never a very easy place to find one's way around, and I am bound to say Her Majesty's Government have not made it any easier. I look to the Minister of Technology to look after my industry, but I am told that the Board of Trade is managing the exports and the Department of Employment and Productivity will decide whether or not I merge with somebody else. There is a whole wealth of brilliant but diverse characters who are involved in almost any single one of the difficult decisions that boards of directors and chairmen and managers have to take.
I want to ask for only one point, and in this I turn to my honourable and right honourable friends on the Conservative side, who, I have a feeling, if noble Lords do not mind my saying so, are more likely to have to make this decision than anyone else. It concerns the Industrial Reorganisation Corporation. I am not a member of it, let me hasten to say; I am a user of it, a satisfied client, so to speak. I would ask my friends not to take any hasty decision about the future of the Industrial Reorganisation Corporation before they have, while in office, had experience of its working. I know the talk about putting it here or there, or taking its powers away, or something of that kind. But business is quite a complicated affair to carry on, and some of the decisions that have to be taken, or that one has to feel one's way to, can be of a highly confidential character, naturally; they affect one's competitors, the people who work for them and sometimes foreign Governments as well. They are not things one can take all around the town. To be able to go to some body of men who understand straight away what you are talking about, whether they agree with you or not, who know the arguments and have seen it all before, is of very great assistance to many industrialists. I would ask my friends to talk with some of the people who have practical experience of this particular body and not to take quick decisions to start altering its structure.
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The fifth point I make is on the question of the squeeze. I suppose this might have been more revelant yesterday. I would say to the noble Lord, Lord Shackleton, that he must not rebuke too much some of us who were not here yesterday. We were working yesterday, and there is something to be said for Members of the House of Lords, if I may say so, who work actively in industry and come to the House and try to contribute, to the best of their ability, some of the things they pick up on the way.
As regards the squeeze, we are moving into surplus—I hope the noble Earl, Lord Cromer, would approve that phrase as accurate and that it will not mislead The Times newspaper. I get rather nervous in talking about this surplus, but I believe it is accurate to say that we are moving into surplus, moving into surplus on the back of the capitalist system and conservative finance—conservative finance, let me say, of a pretty violent character. With this Government we are likely, I think, to stay with the capitalist system and with conservative finance: with the capitalist system because it is the only thing that is likely to save their bacon over the next few months, and with conservative finance because with the amount of overseas indebtedness we have got our bankers will not let us do anything else. But it is pretty rough at the moment.
Let us face the facts. We have behind us a deficit on current account of £500 million over the last five years, a price increase of 22 per cent., a devalued pound and new debt of £3,000 million. If I may use a vehicle analogy, we are holding the car on the road by increased taxes at the rate of £3,000 million a year and a prolonged period of high interest rates. It is rather like trying to cure a patient with injections of penicillin while you are pumping the germs into him at the other end. The tensions which have been built up in this economy over the past four years, and the strength of the medicine that has had to be administered in order to clamber into even a modest surplus, is so strong that it is doing a good deal of damage to the general body of the economy. I believe it is putting us at a very serious disadvantage with a number of our overseas

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competitors who are operating in home markets much healthier, much freer and much easier than our own.
That brings me to the last point I want to make, and this concerns industrial relations. I think we all know really that we ought to legislate. I do not believe anybody who thinks about this matter would think otherwise. I agree emphatically with the noble Lord, Lord Stokes, when he says that legislation is not the whole answer; it is not. This is a matter of people, and you do not cure the condition with legislation. But you do set the climate in which it could be tackled by legislation. We all know it. The Prime Minister knows it. Before he abandoned the Bill he said:
"I could say to them …"
that is, to the British people—
"'All right; not to worry! We are not going ahead with the problem about dealing with unofficial strikes'. I would have a united Party cheering its head off to-morrow. Is that really my job as head of the Government? My job is to face the Party and the country with the problems, not to try to be popular by pretending there are not any.'
He got the people cheering all right, but it was a terrible thing to abandon that Bill. It was worse than not having attempted it at all; it would have been far better not to attempt it. But to stake himself, his reputation, that of the First Secretary of the Government on the success of a measure in that field, of all fields, and then walk out! They certainly cheered him; but they are cheering rather more thinly after the Port Talbot steel works, the coal mines, the Underground, after they have seen the rubbish piling up in the streets, watched all the troubles that have gone on in the motor industry, and even seen the difficulties in this House in getting the necessary papers to carry on the business. It was a very grave mistake—so grave that it has, I believe, weakened this Government and weakened the Prime Minister's reputation to a point where the country ought to be given a fairly early opportunity to judge. I do not know what their judgment will be. It may be that they will judge that we ought not to legislate; it may be they would prefer to risk it. But they ought to be given the chance to say "Aye" or "Nay" to a matter as critical as is this particular area, not only to the future of British industry but to
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the future of the economy as a whole. When I look at the Government and see what it has done and what it has failed to do, I think it is time it went.
6.10 p.m.
LORD DOUGLASS OF CLEVELAND: My Lords, Lord Stokes made a typical speech for Lord Stokes. Some of us on this side of the House could have written his speech for him; and I know he will not misunderstand me when I say that he is no virgin in industrial relations. We look forward to hearing much more from him. Having regard to the problems which he has had to face quite recently, his restraint was really most delightful; much more so than that of the noble Lord, Lord Thorneycroft.
I listened with great interest to the speech of the noble Lord, Lord Brougham and Vaux. I was struck by the thoughtfulness that he put into it, particularly with regard to the job of a farmer. It is now more than 50 years since I had to milk my first herd of cows, and if I say that I milked them with electricity I think your Lordships will agree that I was ahead in mechanisation. If I say that I found the job of "milking" the employers thirty years later much more difficult, I think you will understand that, too.
I am wondering what people think is the job of the trade unions. I wonder what the Opposition think is the job of the trade unions. Do they think that it is their job to carry out the wishes of Governments; to bring down the Tablets from Sinai—which is the Government (whichever Government is in power)—to the people below and instruct them there what they have to do? If they think that, then they are backing the communist and fascist regimés. The trade unions are free. I believe the Opposition say that they are too free. But once that freedom of trade unionism goes, then the understanding between the worker and the employer, and between the employer and Governments will fail; and that understanding is the most important thing that we have inside this country.
Sometimes it is an embarrassment to be associated with the Government. I think the T.U.C. suffer from this embarrassment at the moment, because the Government believe that the affinity of the T.U.C. to the present Government is

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something which should enable the Government to make heavier demands on the trade union movement than would a Conservative Government. These are facts that are difficult to deal with. These are situations which present great problems. The affinity which we have certainly gives us a sympathy for them, and it gives us support for them; but it does not give us an inalienable obligation to follow whatever this Government do, no more than it would with a Tory Government.
I submit that the employers have a similar embarrassment when it comes to dealing with a Conservative Government. We should recognise this, and not talk about head-on clashes between the Prime Minister and the trade unions. The Prime Minister has been pushing the unions and the T.U.C. as far as he can along a sensible economic line, in order that the economic success which is now coming the way of this country might he continued. If, occasionally, he does not get the T.U.C. to go all the way with him, do not laugh too much because this is a tragedy for the Opposition just as much as it is for this side of the House.
Trade unionism is going through a most difficult phase. Inside the trade union movement we have a Left-Wing organisation which is determined to destroy the movement, and we have one hell-of-a-job in dealing with this element—make no mistake about that! But we have dealt with it so effectively that there is less of that element in this country than there is in any other country of the world. The Opposition should say to us, "Thank you for doing that"; we should say to the Opposition, "Thank you for helping us", except that we sometimes feel that that help is beginning to fade. The rape of Czechoslovakia was quite a blow to these people and, as a consequence, a lot of them resigned from the Party. But they did not resign from the activities that have become inherent in their nature, and they are still carrying on with them.
I have been to Russia. What I have seen there is that the Russian trade unionists, who are really the employers, must be closely associated with the Communist Party, and there are bigger tycoons than ever we had inside this country. For 30 years the Russians have been allowed to build up bank balances. The child-
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ren of the generals, of the trade unionists and of the heads of industry have now inter-married; and you have growing up in Russia an aristocracy, if not an autocracy, which is far more capitalistic than anything we have in this country. They are now talking about profits in industry, because their planning is failing.
We have to deal with these people inside our movement, and if we can shock them a little more in the way that events in Czechoslovakia shocked them, we might get rid of this small element in this country. We must be quite frank when this element gets into control of trade unions in this country—as it has done in some trade unions—and say that it is a bad thing for the trade unions and also for the country. Nobody has fought this problem harder than the present Government, because the present Government is socialistic, not communistic. But these are some of the problems with which we have had to deal before we ever meet the employers.
What has happened when we have met the employers? Thirty years ago I had to meet the employers in North Wales about a small steel works called Brymbo. It was obsolete and clue for demolition; it was placed in a part of the country where it could never succeed, and we negotiated a reduction of wages to try to help the management. I was condemned by some of the people I have just spoken about. They approached our members in the trade union world and said that this was not trade unionism. But we stuck to our guns and to-day, 30 years later, Brymbo is one of the most efficient electric steelworks in this country. This shows what trade unionism can do if it is met on the opposite side by the right type of management.
I remember discussing with the incoming manager—he was quite a young fellow; I was quite young myself at the time and am not so old now—how much the electric furnace which he was going to bring in would cost. It was a secondhand one. We discussed how much it would cost to repair it; what would the wages be; what would the cost of raw materials be; what hope was there for the future. We came to the decision that long-term planning would pay the members in that part of the country, because if that works closed down that part of

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the country was going to be desolate and obsolete, and unemployment was going to be rife. Not only is it one of the best electric steel works in this country to-day; it pays some of the best wages. This is an example which I think could well be followed.
But what happens when we meet the employers to-day? Just before I retired I had an experience in the steel industry, where we had a pretty good record. I was negotiating wages on a national basis on behalf of steel workers in Scotland. Then we got stuck. The case I had was a sound one. I want your Lordships to believe that. I was not pushing forward a "phoney" case of any kind. As a matter of fact, I had the same agreement in Wales that I was asking for in Scotland. It was as simple as that, and I think that should convince your Lordships of the sincerity of what I am saying. At one o'clock in the morning we all went home, dispirited because the employers could only say, "No". They had many long arguments, but they said, "No". On Monday morning they telephoned me to tell me my members had stopped work in Scotland. I said, "I am not surprised, and I do not think I can get them back". And I did not get them back, for four days. At the end of the four days the local management gave them a better settlement than I would have accepted nationally a week before.
My Lords, are you going to throw the blame on to trade unions for the present state of industrial unrest in this country when this happens? Your responsible trade unionist is denigrated, without anybody saying anything about the employers who do this. And it is not enough to say that this happens in public enterprises, because it happens in private enterprise time and time again. The trade unions have been fighting against this all the time, and the consequence of this attitude of mind on the part of many employers has been that the trade union movement has moved to the Left. If the T.U.C. is more to the Left at the present time than it was when I and some of my colleagues were on it, the employers are not without blame.
Having said that, I would add that I know that the employers have a problem when they have a small group of people,
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perhaps 20 or more, who can stop 20,000; and I should not like to be the man to tell them just how to deal with that particular situation. When they have had a stoppage for about three or four weeks we bring in an outsider, a catalyst, to solve the problem. We ought to be ashamed of this, because he usually comes in when both sides want to get something done, when they both have their faces to save, and so the outsider gets a reputation for peace-making that we could well have had in the industry long ago if we had had any sense. It is a difficult problem, and I think it gave rise to the sentiments expressed by the noble Viscount, Lord Watkinson.
At first, in dealing with the question of an incomes policy I supported legislation. I said from the T.U.C. rostrum, not from the platform, that the reason we shall not be able to establish a voluntary policy is that we shall not have enough volunteers. And that was prophetic; we do not. I asked the question, "Can we have civilisation without legislation?". I do not think we can. There has to be legislation somewhere.
Inside the trade union movement we are advised to get to the bottom when we are trying to negotiate productivity agreements. I would advise everybody to go to the top first, and do not go away from the top until you get some understanding, because the rules of every trade union in this country, so far as I know—and I know most of them—give the executive council of that union power to deal with any industrial matters that come within its purview. I do not think we have done enough talking to the top in this particular respect. I do not think the C.B.I. have given us the encouragement to talk to the top, and I think that they—like some of my friends on the opposite Benches—have talked rather too much about the wickedness of the trade union movement. I have tried to show your Lordships some of the problems we have had to deal with.
The noble Lord, Lord Thorneycroft, spoke about interest rates, and here he struck a chord with me—not because I have any money: maybe that is why I do not want high interest rates. I think that noble Lords on the Benches opposite control most of the money, but interest rates are not a matter which is decided in each individual country. The

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decision may be printed there, but the international control of money has shown that the control of interest rates is international; and one by one the different countries in the Free World have put up their interest rates because money has been tight from an international centre. I put it to the noble Lord, Lord Thorneycroft: "If you have strong feelings on that—you have many friends in Switzerland; go and tell them about this; and if someone will pay my expenses I will come with you." I think that will put an end to the suggestion that this Government are responsible for the high interest rates.
Despite the high interest rates, the balance of trade is now moving in the right direction; and in spite of all that has been said about the wickedness of trade unions I want to say to noble Lords opposite: "You have the cheapest labour in the Western World. If you had had trade unions which had forced rates up to the level of France, America, Sweden and Italy, you would have had a case. "The fact is that employers in this country have the cheapest labour of any Western country, so do not let us have any talk about the trade unions causing the problems of finance that we have in this country. They do not.
This leads to another thought: are we wise in holding down wages in this country? If you trace the problems facing you, you find that wages problems arise more strongly in the transport industry than in any other industry in this country. I do not think it is because transport people are evil; I think it is because they are associating with people from other countries who receive high wages. If a man in a ship operating between America and Britain is getting British wages and goes in for a drink with an American who is getting American wages, do you expect to have industrial peace and contentment with the low wages that are paid in this country? I think we have to give some thought to this problem.
On the same theme, the large companies in America are now spreading their tentacles throughout the world. I am not saying this in criticism; I am glad they are doing it, because without this money we could not make the progress we are making. But so big are the companies, so vast
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is their control of commerce, that they are becoming stronger than Governments. Is the trade union movement wrong to become strong in order that it may oppose these people? I do not think so. I think trade unionism must have the strength to compete with the strength of the employers.
Often, as I have illustrated, I think the employers are no more sensible than the trade union side. But this is no reason for continuing the folly; and this is what has prompted the present Government to decide that something must be done about the existing circumstances. Here I suppose that I should declare an interest, having regard to what my noble friend Lord Shackleton said about these bodies. I was not sure that I should do so, but I am a part-time member of the Monopolies Commission. I am not going to try to tell you what that Commission should do, or what the new body should do. I hope that they will learn from experience. But surely a change was needed, in the changing circumstances, if something was to be done about the increasing inflation arising, in no small measure, from increasing wages. The problem must be thought out; and not on a partisan basis. And it is no good the pot on the Conservative Benches calling the pan on the Government Benches black—I nearly used a more vulgar term, which some of my friends would understand. There is a job to be done here, a common job between the two sides.
In dealing with wage negotiations and claims for increases I have always been a little bothered about this percentage calculation. The Prices and Incomes Board talk about a 3½ per cent, and the T.U.C. about a 4 per cent. norm. Somebody else had another percentage. I had to deal with this problem during the many years that I had to negotiate; and always in steel, on a national basis, we negotiated a flat rate of increase for everybody in the industry. If the increase was 10s. a week, it was 10s. a week for the man who earned £50 and 10s. a week for the man who earned 50s. I was pressed many times to indulge in the percentage method. Frankly, I believe that if differentials are to be created they ought to be negotiated, and that the negotiations should be local, where the men know what they are talking about and know the differences between the jobs.

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But we kept away from percentages, and having regard to events I think we were very wise in view of the upsurge in this country among the lower-paid men, in jobs where there had never been trouble before, with claims for higher wages. And apparently they were justified, because the increases have been granted almost before the claims were made. There is an astonishing willingness to pay higher wages to the lower-paid men in this country; and there is an astonishing willingness on the part of some sections of the financial Press, who have never been friends of the Labour Movement, to say that these men ought to have these increases.
The question is asked: if we are going to give something to the lower-paid men, has it got to be given to the higher-paid men? We negotiated wages which gave nothing to the higher-paid men but a great deal to the lower-paid men, and graded up according to earnings. I am telling your Lordships this not to boast but to show that it is possible to do this and that it is possible to get acceptance of it within an industry. If the men at the top have a case for more money, the claim can be negotiated separately. Company negotiations are very complex, but I think that this percentage procedure will get us down before we are done. Having said that. and seeing some of the increases that have been paid to the very highly-paid men, I wonder how men who earn something like £20,000, £30,000, or £40,000 a year can talk about the iniquitous trade unionists who ask for an extra 10s. a week. This has always been a mystery to me. But there it is. It may be, I say to Lord Thorneycroft, that we do little by way of taxation to take some of it back.
We have talked about what happens in other countries from the legal standpoint, and I was rather enamoured with what happened in Sweden, where they had a method of sharing out the money. The two sides met, the employers and the Government, the industry and the Government—the noble Lord, Lord McCorquodale of Newton, shakes his head; he was with me when we discussed these things—and they decided how much money would have to go for Government purposes, public purposes, and how much should go back to the
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industry. Then the trade union decided how it should be shared out within the industry. This was a remarkable system. I never could see it working in this country, but I am bound to say that it worked in Sweden, and everybody told me that this would be a good thing in the United Kingdom. I had my doubts at the time. I find now that in Sweden they pay the highest wages in Europe. Together with that, they have the highest productivity in Europe and they have more millionaires to the square foot than any other country in Europe.
This is an anomalous state of affairs, is it not? And yet they are meeting with tremendous trouble at the present time because there an ethical consideration is involved. They have high wages and high productivity, and they have millionaires among the shareholders, for whom the noble Lord, Lord Thorneycroft, made such an eloquent appeal; and yet they are not satisfied. Why are they not satisfied? They are not satisfied because basically most men want to see a fair deal, and a great deal of money does not compensate for unfairness. There is going to be a good deal of unrest, if all the reports I get from Sweden at the present time are correct, simply because there is an ethical consideration which you should never lose sight of. I do not care whether you get the legal process to deal with this problem, as some people want, or whether you have the voluntary process to deal with it: the innate desire of people all over the world for a fair deal will destroy inequity wherever it is. Our task is to get to the root of this problem and to shift it before it causes all the unrest and violence that such things have caused in other countries and, indeed, in this country.
My Lords, I have gone on long enough, and I want to come to an end, but it may be that I should say something about Australia and the legal side before I sit down. It is some years ago now that I was talking with my Australian friends, but at that time the Australian Labour Government were at their wits end because the dockers in that country had so many strikes that the economy itself was being affected. The Government looked at the legal standpoint, just as we have been advised to do now, and they brought out a

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system which has not, in fact, been much discussed. They did not penalise the men: they penalised the union. Every time there was an unofficial strike they fined the union to which the men belonged who were on unofficial strike. It was effective; it stopped the strikes almost completely almost overnight. Everybody said, "Here we are—the millenium has come! We do not have to think any more, we have only to make laws". The idea was so successful that they tried to spread it; and to-day the Right Wing trade unionists in Australia are condemning the legal sanctions that apply in that country.
If proof is needed that legal sanctions are going to be difficult, there is the proof. You have the proof in Sweden and in Australia. I could go into the position in other countries, because I have visited them and I have stood at the works gates trying to organise people. I have doubts about the legal system, but I am willing to examine it and I am willing to try to find a way. But I do not want anybody leading the trade union movement like a horse to water and finding that it is not thirsty, because if that happens you will never be able to achieve success in industrial negotiations.
My Lords, I close on this point. When I first went on the General Council I was told by one of the senior members, "You will not need wisdom on the General Council; you will need guts". If the Opposition had just as much guts as this Government have shown at the present time in dealing with these problems then we might get somewhere with it and find a solution. I hope we do.
6.37 p.m.
LORD HANKEY: My Lords, I should like to start by congratulating the noble Lord, Lord Stokes, and the noble Lord, Lord Brougham and Vaux, on their maiden speeches. I hope that we shall often have the pleasure and the interest of hearing them in your Lordships' House.
I have chosen to speak on industrial relations to-day because I am sure that these issues are fundamental to the survival of the United Kingdom as a meaningful entity. Let no-one be complacent about one or two months' reasonably good trade figures. We are of course delighted about a better trend and about
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our export achievements. But please remember that there has been a tremendous boom in world trade and if the United States economy is now going over the top, as the stock markets imply, then the boom is not very likely to continue. Please also remember that many of our competitors have done at least as well, or even better, out of it than we have: witness the revaluation of the mark and the tremendous success of Japan, where even British companies tend to place orders for ships nowadays.
I have to travel fairly widely, and I am still always hearing complaints about our delivery dates slipping, about poor after-sales service and often about inadequate care for quality in production. I think the Q.E.2 was only a particularly striking example of a state of affairs which is still much more widespread than it should be. I am sure that our poor industrial relations are largely at the bottom of the trouble, because our industrialists and technologists have all the techniques and the ingenuity to make an immense success of our country and of our industry in the present century. Therefore we absolutely must improve our efficiency.
I get rather annoyed when I hear people in the train say, "I hope that someone is going to have a bash at the unions". Half the trouble is that many of our trade unions have largely lost control of their members. If ever there were a living example of the danger of trade union confusion it is in the United Kingdom to-day. We have some of the best trade union leaders in the world (and in this connection I am really proud to follow the noble Lord, Lord Douglass of Cleveland), but we allow a state of trade union structure and organisation, and also trade union law, which renders a great deal of their attempts at real leadership almost hopeless.
I mention trade union structure just in passing because, after studying trade union structure in some other countries, I think that it should correspond to the real industrial interests involved. A trade union which is purely sectional, like the bricklayers in the South Wales Steelworks, must mainly have regard, it seems to me, to sectional interests. At the other end of the scale, a trade union which overgrows its strength and includes all sorts of people in all sorts of industries,

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some in large groups and some in penny packets, is usually not efficient in organising the sort of collective bargaining at plant or company level which the Royal Commission and the White Paper rightly emphasised we need. We really require a few industrial unions like there are in Germany and Sweden. I was very interested in what the noble Lord, Lord Douglass, had to say in that connection. Surely we ought to look once more at the German system of works councils and workers' representation in the boardroom. That system produces good communications, although I am quite aware that neither side really likes it too much. But I cannot, in the time available, say more about this to-day except that not nearly enough is being done about the structural problem in our trade union movement, in spite of the considerable rationalisation that is going on and the very careful studies that have been made.
For, underlying all our troubles there is the present state of the law. We really need a new statute about industrial relations, a statute more suited to the huge integrated industries of 1969, such as the motor vehicle industry or shipbuilding, than to the smaller companies, typical of the turn of the century, when the Acts of 1871 and 1906 were passed. I realise that we cannot get such a thing in this Session of Parliament. But I suppose that so long as any element of our law regards trade unions as a "conspiracy" instead of recognising that they are an essential feature for the orderly conduct and development of the economy, we shall have to go on "excusing" them (I put the word "excusing" in inverted commas) for their actions and giving them the present legal immunity for acts done in furtherance of trade disputes.
This situation is one of the most remarkable anachronisms of our time. Every time the courts have got around to making better sense of the situation, Parliament has restored it. The last occasion was only in 1965, and the situation of indiscipline and disorder has steadily deteriorated ever since. I really think that the Government ought to have given much greater priority to this problem of industrial relations and less to other aspects of economic policy, which they have taken so seriously.
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But the result, in fact and in practice, is that the law really does not demand good faith in the execution of works agreements. So long as anyone can cook up a trade dispute, even within a few weeks of a collective agreement being made, there is normally complete immunity for those who break the agreement and ignore the proper procedures for settling disputes, however flagrant their action and whatever the undesirable consequences for the company, for the livelihood of their workmates, for the industry, or for the country. The motor industry, about which the noble Lord, Lord Stokes, has spoken to us so interestingly to-day, is a good example of this. At one moment we find there are no brakes, at another moment the dispute is about car bodies. At another moment it is the assembly workers; then it is the radiators, and then at another time it is electrical equipment. How can any big integrated industry run in those conditions? It is quite impossible. And please remember, my Lords, that with interest rates as they are at present it is very hard for a company to keep such stocks that it can face these checks with equanimity.
I have studied the Donovan Report, the White Paper, In Place of Strife, and the T.U.C. Programme for Action, as adopted and modified on June 5. I have followed Mr. Victor Feather's most commendable efforts to apply that programme here, there and everywhere. I warmly support all current efforts to improve collective bargaining. But what hope has Mr. Victor Feather, or any other trade union leader, really got in the present state of the law? Even if he gets a new collective bargain made, any local troublemaker can upset it again. The local demagogue may tell his mates that he will get them an extra shilling an hour if they come out on unofficial strike; but if after a long dispute he gets them only 6d., where does the branch secretary or the T.U.C. stand in trying to get the collective agreement executed and maintained? They just look silly; because the law does not demand good faith, does not recognise their collective bargains, and provides no practical available redress if the agreements are broken.
The Donovan Report says that most agreements could not be enforced because

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they are so vaguely drafted and because it is hard to identify the real position or the proper procedures. But that is exactly why we have so much trouble, as the noble Viscount, Lord Watkinson, explained. If we were to tighten the law, the agreements would, I am sure, have to become very much clearer; and so would the procedures. But without that I believe that our efforts will be futile, whatever the Government may put in their promised Bill. The whole situation reminds me of what that great scientist Galileo said about mediæval theology: "It is like trying to milk a billy goat into a sieve". Even if the milk of good collective bargaining were there, it would not stay put, in the present state of the law.
I am much in favour of most of the useful ideas in the Donovan Report and in the valuable supplementary notes, notably those by Lord Tangley and by Mr. Andrew Shonfield. I am also in favour of the plans set out in the White Paper and by the T.U.C. But, let us face it, these are most unlikely to solve our present problem unless this ridiculous gap in our law is put right, and put right in a way which everyone can understand.
My Lords I find, coming rather late in life to your Lordships' House, that the drafting of our legislation is really as dry as dust and remarkably unrewarding to read. I miss the declaratory or explanatory preambles, the "Whereas-es" which might enable one to understand what the legislation is all about and what is its real background. The perpetual references to other Acts, which are only rarely explained, are batting to anyone, however well-informed, who has not a legal library at his immediate disposal. I should like to see a preamble included in our next Bill on Industrial Relations saying in effect—I am thinking aloud, not drafting;
"Whereas close co-operation between management and organised labour is needed for the effective conduct of industry on which the prosperity of the country and the national standard of living depend; and whereas rates of pay and conditions of work and procedures for the urgent settlement of disputes should be agreed in collective agreements, the proper excution of which should be guaranteed by both sides of industry and have the force of law during the period of their validity…."
and so on. I think that this would explain to people who read the law what was the intention of the law and what
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was the sort of problem with which it was trying to deal.
I think that ideally the Act should give the force of law to all labour agreements (with possible exceptions where both parties specifically desired the contrary), perhaps after registration with the Department for Employment and Productivity or with the Industrial Relations Commission. Special courts in each area, with assessors from both sides of industry, should judge alleged breaches of these agreements by either employers or employees. Quick decisions are needed, not endlessly drawn out procedures such as those which exasperate our work-people to-day. Either side of industry might be found to be at fault. If penalties had to be applied against workers, their companies might be obliged to deduct small weekly amounts from individual wage packets and pay them to the courts. Other countries have labour courts and I can assure your Lordships that they are not usually kept very busy and they do not by any manner of means usually decide against the workers—in fact, quite the contrary.
This would not of course prevent men and women from giving notice and changing jobs. Nor would it prevent strikes. If collective agreements, which would normally be valid for at least one year, could not be renewed when they ceased to be valid, then strikes might very probably occur. Often that cannot be avoided. The usual processes of conciliation and investigation would then be followed, just as we do now. But at least a works agreement might then be executed until it ceased to be valid, and good faith in its execution could be insisted on by both sides—trade union leaders and management—and backed by the law. I believe it would make an immense difference to the efficiency of modern industry, all the difference between prosperity and the squeeze.
I realise that these suggestions are revolutionary in this country—
LORD BLYTON: Hear, hear!
LORD HANKEY:—but the Government and the C.B.I and the T.U.C. ought to recognise that these problems cannot be postponed. In any case, I think that these suggestions are less revolutionary than the Government's interference with wage rates and prices. In view of what

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has passed this summer I fear that the Government's promised Bill on industrial relations will show that they are only tinkering with the problem. But I am sure that we should keep in mind the real basic need. At the very least, we should adopt the proposals of Lord Tangley and Mr. Shonfield in their supplementary notes to the Donovan Report.
My Lords, I want to mention some important administrative questions which affect industrial relations. The position of those in industry who believe in orderly collective bargaining is further weakened because many or even most people involved in an unofficial or unconstitutional strike do not really suffer too much. The income tax authorities pay rebates to the strikers and the men's families get supplementary benefit. So here we are paying official funds out to men who may be breaking their agreements, refusing to follow agreed procedures and defying their own elected trade union leaders regardless of the damage to their workmates or to anyone else. You may say, "What a disgraceful example of lax administration." As a public official of 38 years' experience, I want to say that you cannot blame the administration. Our officials cannot distinguish between justifiable strikes and unjustifiable strikes, or between agreements which are kept and agreements which are broken, unless the law makes such a distinction.
This legal and administrative absurdity leaves our trade union leaders without "teeth" in ensuring good discipline among their members. Indeed, I believe that they often distribute some sort of strike pay to those who have defied them successfully, even if the strike be unofficial or unconstitutional. I cannot believe that the promised Commission on Industrial Relations, to which one can only wish well, will be effective either, if it has no teeth. We must beg the Government to make it effective. In short, I fear that these bodies may turn out to be largely irrelevant unless we close the gap in the law.
Finally, my Lords, I want to say a word about economic policy in connection with industrial relations. The people of this country are determined not to let their real standard of living be eroded by the rise in prices. Every time the
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Government let demand get too high and take action to damp it by measures which raise prices—the selective employment tax springs to mind—it forms a starting point for another round of wage claims. The demands for higher wages which lie behind this year's rash of strikes may no doubt be eventually traced back to the devaluation of November, 1967, and to the measures which followed. I think the Government have been right and should be supported in their endeavour to link wage rises to productivity and to hold prices stable. But they are most unlikely to succeed if they let demand be swollen by the credit institutions or by any undue rise of public expenditure.
There is a severe limit to what the Government or the Prices and Incomes Board, or trade union leaders, or anyone else can do to restrain excessive wage claims or to secure the execution of agreements, once demand increases and prices rise. To press any such attempts can only make those concerned horribly unpopular and reduce their real influence. I think this is why the Prime Minister and Mrs. Castle, despite their most courageous efforts, have failed to lead the Labour Movement and the Trade Union Movement in the direction which they wanted when they published In Place of Strife. That is why I think they should have dealt with this question of industrial relations at a much earlier stage. I am glad that the Government have recognised their responsibility in this regard by controlling credit and public expenditure, as we cannot hope to institute a proper system of industrial relations while demand is overheated. Nor can we keep up our exports if costs rise, as they are now doing, more than productivity. But wages and price controls are valuable in the grey area before overheating occurs, and I think it is the job of the Government to see that we stay within the grey area.
To sum up, my Lords, there is clearly no one cure for our troubles, but I believe that unless the law on trade unions and trade disputes is much more radically and fundamentally reformed than is now intended, one fundamental cause of trouble will be left untouched and will render futile most other action which is taken. We must deal with the basic legal issue in the broadest terms and drag our poor country into the second

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half of the 20th century. If the law does not demand good faith, we cannot expect management to be able to manage, or our trade union leaders to be able to lead, or our industry to profit by the great technical genius of our countrymen, much of which is now frustrated. In no other way, I believe, can we expect capital to be invested here on the same relative scale as in other countries. Nor can we in any other way maintain our export markets and stop the decline in our relative standard of living compared with that of all our neighbours on the Continent.
6.59 p.m.
VISCOUNT MASSEREENE AND FERRARD: My Lords, I wish for a moment to refer to a few of the remarks made by the noble Lord. Lord Douglass of Cleveland. I should like to assure him that I have always had the greatest respect for responsible trade unionists, of whom the noble Lord is one. I understood him to say that wages in Italy and France are higher than wages in this country. I am sorry to have to say that I think the noble Lord is misinformed. It is true that Germany has caught up and passed us—and Sweden, too. We always come up against this with the Labour Party. They are always trying to compare every country with Sweden. But you cannot compare Great Britain with Sweden.
LORD DOUGLASS OF CLEVELAND: My Lords, I am not mistaken. It may be argued that agricultural wages in the south of Italy are low, but manufacturing and industrial wages are higher in Italy and France than they are in this country.
VISCOUNT MASSEREENE AND FERRARD: But, my Lords, they do not have such cheap food as we have in this country. I am talking about the purchasing value of our wages and I am sure that if it is worked out statistically, the noble Lord will find that I am right. I was talking about Sweden. Sweden has a population half the size of London's, and a geographical area nearly 2½ times the size of Britain. We cannot compare the two economies.
The noble Lord blamed employers—not that all employers necessarily belong to the Conservative Party—and financiers for the high bank rate. Good heavens! Employers hate the high bank
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rate. It has nearly ruined me. One of the reasons why we have a high bank rate is the great number of strikes we have had during the last two or three years, which has meant that productivity has suffered. Another reason is that we have a highly-organised Welfare State—I do not object to that—so that we have great consumer expenditure. If there is big consumer expenditure and low productivity, there has to be a high bank rate. It is one of the ways by which we can take the heat out of our economy and try to keep consumer expenditure down.
There are one or two bright aspects in the gracious Speech but, on the whole, it is the same old story. The whole accent is on nationalisation, the cure for all ills. The Labour Government is rather like a doctor who prescribes sugar for a diabetic. Surely it is time the Labour Party gave up this old dogma of nationalisation. I am pleased to see in the gracious Speech that the Government are going to bring in legislation to give more assistance to industry in the intermediate areas. But if industrial and other companies did not have this crushing taxation, they would need none of this help. Personally, I am always suspicious of this help, because it rather smacks of back-door nationalisation.
I believe about 80 per cent. of the economy is in small businesses, I am interested in small businesses. But they now make hardly any profits at all, and therefore have no surpluses to plough back into their businesses. I think it was the noble Lord, Lord Stokes, whom I should like to congratulate on his extremely interesting maiden speech, who said that the average age of machine tools and of machinery generally in this country is about ten years. Of course it is; we cannot afford to buy new machinery because we have to pay so much tax. I hope that this point has sunk home.
By far the most important part of the gracious Speech is that dealing with industrial relations. It has been said so often that, if we do not get our industrial relations right, we will have industrial chaos and the country will be sunk. We are told in the gracious Speech that we are going to have a Bill to improve industrial relations. I only hope we do, but, as the Prime Minister has capitulated over his previous legislation to put

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In Place of Strife into law, how is any new Bill going to have any teeth? Is this new legislation going to work? No doubt it will have teeth against the employers, but the poor employers have so many teeth in them already that they are absolutely reeling with the pain. We have had this great rush of strikes in the last few months. Though there is no conclusive evidence, I can only presume that it is owing to the Prime Minister's capitulation. We have had strikes and we have had some wage rises, of between 10 and 20 per cent. Where is it going to end?
Several noble Lords have said that legislation cannot cure strikes; that industrial relations is a very human thing. But, of course, legislation can lay the basis for having good industrial relations. I think it was also the noble Lord, Lord Stokes, who said that for large firms the problem of good relations between management and shop floor becomes more and more difficult. We never have strikes in small companies and in agriculture. The reason is that the managing director or some executive is always there to go straight on to the shop floor and patch up any difficulty. Probably he knows most of his people by name, and their families. But in enormous companies like I.C.I., or the noble Lord's company, with a vast number of employees, it is a terrible problem, because they are too big for human contact.
The root of the trouble is that the unions cannot control their own people. The curse of this country, as has been repeatedly said, is unofficial strikes. I cannot see why the unions, where there are unofficial strikes, cannot make a few examples and put the ringleaders out of the unions, or fine them. This militancy on the shop floor is an appalling problem. I feel, as has been said already, that we must have some legislation laying down a code of practice, a code of law, by which employers and unions must abide. Otherwise, I can see very little hope. As things are at the moment there is an inducement for men to strike, because the strike is usually successful. They suffer no hardship, because their families can get national assistance. It is the height of absurdity that when you have a strike in a nationalised industry the workers' families can get national assistance. If
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they were unable to get national assistance—apart, of course, from the real hardship cases—I am sure there would be less inclination to strike.
Surely it is time that the trade unions modernised themselves. After all, in certain countries on the Continent workers in a public utility company cannot strike without giving, I think it is, three months' notice. I feel that it would be a good thing if we could have something like that here. It is true that some people say that for all practical purposes the trade unions are outside the law. I agree that technically they are within the law, but for practical purposes they are outside the law. I should like to see a code of practice under which, if there is an unofficial strike, the unions should be responsible and be fined so much according to the period of the strike and the number of strikers. It is not practicable to fine the individual working man, because the money could never be collected; or the employer would have to collect it, and it would cause a great deal of bad blood. We must hold the unions responsible for keeping order in their own house.
There is one thing on which I have always been keen and which I think would improve industrial relations (I should hope that the Government would give some support to it at some time), and that is the idea of employees' taking shares in the company—share ownership. I agree that the average Socialist does not like this, because he is afraid that if the employees are given shares they will turn into Conservatives. One of the excuses for nationalising industries is always that the industry is going to the people; but I am sure that the average worker would far prefer to have a personal stake in his particular firm. Companies have tried this, and the trouble has been that the employees usually sell the shares. But if we could get round that difficulty, I think this would greatly improve industrial relations.
I most heartily welcome the paragraph in the gracious Speech which refers to equal pay for men and women. The year 1975 may seem a long way off, but to bring this into practice will not be easy. It has always struck me as quite incongruous that, while we have Acts against racial discrimination, we have always had this discrimination between

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the sexes. It is not logical, and I heartily welcome this paragraph. It will, of course, increase the expense to industry, but industry will have to bear that.
I should like now to refer to the paragraph in the gracious Speech on the selective expansion of home agriculture. Governments of all colours have always promised agriculture a paradise, a promised land, but it has never come. Perhaps I might compare the price of corn with the price of coal. When I was a boy I remember coal being unloaded on the shore from Glasgow into the Isle of Mull on the West Coast at about £2 a ton.
LORD BLYTON: Miners were cheap then.
VISCOUNT MASSEREENE AND FERRARD: This was in the early 'thirties. The price of corn was then about the same as it is to-day. Nowadays the price of coal is, I think (I have not checked this), about £14 a ton. I do not object to the price of coal being £14 a ton. I went down a mine in Durham before the war. A miner's life must have been a hell of a life and tough, and I think that everything the miners get, good luck to them! But how about the poor farmers? The price of corn has been fairly static the whole time. We are promised great things to come, but they never happen. I only hope that in referring in the gracious Speech to the encouragement of selective expansion of home agriculture, the Government will not bring this encouragement into factory farming until a proper code of conduct has been accepted. The code of rules accepted at the end of last Session is really not good enough.
There is one aspect of agriculture that worries me, and that concerns the question of housing, about which quite a lot has been said in the debate on the gracious Speech. In agriculture we have no option but to cut down our labour every year, and we then have quite a few houses left unoccupied. I know that a neighbouring estate to mine has 14 houses unoccupied, and I have four unoccupied. The trouble is that under the existing rent laws we are scared to let these houses, because if we do they are gone for ever. We only get low rents from them, which are not enough to keep the houses in good order. It would be
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most helpful if the Government could bring in some legislation to help this situation, but I know that this is very difficult. If we could let these houses and have some hope of getting them back if we ever required them for agriculture again it would be helpful. I know that the whole question of housing is very difficult. I have always thought that the best thing to do is to alter the Rent Act and so allow landlords to charge fair rents in order that they can keep their houses in good order. If any family cannot genuinely pay the rent then you should have subsidised rents, which I think would be a great help in the country.
That is all I will say. I should have liked to say a great deal more, but I am sure your Lordships would not like that. However, may I just add one word. I was unable to understand the noble Leader of the House429 Address in Reply to —perhaps I misheard him. I thought he said that it was preferable for people to remain unemployed and receive social security benefit than to take a job that was not suitable for them. Well, my Lords, is that right? Perhaps I did not hear the noble Lord correctly. I quite agree that a craftsman cannot be expected to take a job which entails doing some menial work, but you ought to be able to stretch a point there.
I was very pleased to read about the favourable balance of payments, and I only hope that it continues. We shall have to have a great amount of favourable balances to repay all the money that we owe, but long may the favourable position continue.
7.23 p.m.
LORD BLYTON: My Lords, the gracious Speech deals with many subjects of great interest to the nation, and I will speak on three of them only. I, want to deal with the economic cost of joining the Common Market, the Coal Industry Bill and human relations at work. I listened to the noble Lord, the Leader of the Opposition, who has sent me a note to say that he cannot be here this evening because of another engagement. I listened to him deal with the Common Market last week. He deployed his arguments in his usual robust way, and at the latter end of his speech he left his options open. The great surprise to me in his advocacy of joining the Market was when he referred to the

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undoubted fact that the majority of the people in England were against it. He said, and I quote:
"One of the reasons why public opinion has shifted has been the great amount of publicity by those who are opposed to our entry … there has been an almost deafening silence from those who think differently."—[OFFICIAL REPORT, 30/10/67; col. 127.]
How he arrived at that conclusion I cannot understand. For twelve long years nearly every newspaper in the land has been urging on the people the great benefits there are in the Market for us. For over twelve years there has been this constant agitation to get in the Market. There have been only two newspapers against entry. We have had organisations like "Keep Left in Europe", we have the European Movement, who not only want us to join the Economic Community but also are bent on a Federal Parliament in Europe and on England's abrogating her sovereignty to it. They have plenty of money; they take M. Ps. to Brussels to see the set-up, and for many years they have issued brochures, pamphlets and held meetings all over the country. They have the resources and the Government behind them, together with the Tory and the Liberal Party. If the opponents of the Common Market had just half of the pro-Marketeers' resources the number against entry would be far greater than it is now. We have no C.B.I., no European money behind us at all.
The reason people have changed is because they now realise what it means to them: cost-of-living increases; loss of sovereignty for the nation, and Parliament in Europe more remote than now for them to ventilate their grievances. They have no desire to be ruled, either politically or economically, by a bureaucracy abroad. The people whom Britain recognises as our closest political and human links have been for generations, and still are, those nations which we largely created by British emigration, capital and economic development over the past 200 years. Australia and New Zealand are flourishing independent States built up by the British and founded on British political ideas that prevail still to-day. Canada and India, with our long association not merely in trade and administration but also in education, have created a community of ideas which has
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survived the manifold difficulties of the present world. People in Britain are not prepared to throw over the Commonwealth for six nations in Europe. People are now recognising what is involved in this issue. Hence the change that the noble Lord the Leader of the Opposition was concerned about. People have been saturated with pro-Market propaganda, but have at last not accepted it.
What of the economic cost of joining the Market? Let me say that from Britain's point of view I think there is the strongest reason for developing an expanding EFTA until the time comes that a wider free trade area can be achieved. EFTA has bound together in a highly successful free trade area those nations which believe in closer trading without the surrender of essential sovereignty and without agricultural protectionism. It is a type of association well suited to British political ideas and economic needs. EFTA achieved complete industrial free trade in six and a half years, well ahead of time, between all the eight countries. That has been done without forcing any rigid pattern of external tariffs on any member. In this sense EFTA is a free trade area and not a customs union. This leaves it open for us as a nation to continue our traditional policy of the free import of food and raw materials from outside the EFTA group, while allowing those other countries that wish to do so to practise their traditional agriculture protectionism.
EFTA has also worked out rules of industrial and commercial competition without any supranational interference by any bureaucratic body in the internal affairs of the member countries. It also allows each nation to follow whatever foreign or defence policies it wishes. For these reasons, and until some better and wider economic and political group can be established in Europe, it should remain a major objective of our policy to preserve, strengthen and enlarge EFTA in every possible way. It is wise to safeguard and foster what we have until we have something wider and better to put in its place. I am confident the E.E.C. does not fit in as it is now.
What of the cost of living and the balance of payments? The Chancellor of the Exchequer last week in another place gave some of the increased prices

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for foodstuffs in the Common Market—meat, pork, cheese, butter, eggs and bread. I will not quote them all; they can be seen in the House of Commons Hansard of October 29. These are the basic foods of the working people. No wonder the people of Britain are worried! Trade unions have warned that if we go into the E.E.C. and prices go up they will press for increased wages. This will increase our costs and make us less competitive, as export prices would rise.
The most serious social and economic effect on us, other than the load on our balance of payments, would be the serious influence on our own very efficient agriculture. Grain prices would rise steeply. They are about 50 per cent. higher in the E.E.C. This would bring two serious consequences to us. There would be an increase in the production of wheat and feedingstuffs, which one can buy more cheaply from overseas, and the price paid for feedingstuffs by farmers producing meat, eggs and dairy produce would rise sharply. Feedingstuffs represent one-third of the costs of British agriculture and the change would force British agricultural land from production of secondary foods like meat and milk to primary foods like wheat and barley. It would be damaging to most farmers, since 60 per cent. of our total farm sales are from the livestock sector.
Another economic consequence for us of going into the Common Market is that we should put at risk our ability to buy the essential imports we must have in order to live. At present nearly 30 per cent. of our imports come from the Commonwealth, and about the same percentage of our exports are sold to the Commonwealth. A large proportion of our essential imports of food and raw materials comes from the Commonwealth or elsewhere outside Europe. Almost none at all comes from the Common Market. The essential materials we buy from Europe come almost entirely from EFTA countries, like timber and iron ore from Scandinavia, and bacon and butter from Denmark. Fifty per cent. of our imports of essential goods like dairy produce, cereals, feedingstuffs, sugar, coffee, tea, rubber and textile fibres come from the Commonwealth.
Therefore, a major switch from the Commonwealth to the E.E.C. would put our economic future at the mercy of
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people in the High Authority in Europe over which we should have no control. We should have to put a tariff on food coming from the Commonwealth which now comes in free or under Imperial preference; and we should have to do the same with some of our raw materials that we import. When we have done this, then we face reciprocal action, because once we put tariffs on goods from the Commonwealth we can expect to lose our free entry and Imperial preference on our exports to them. We should have to put a tariff of 70 per cent. on our trade with the outside world if we go into the Common Market, and I think we shall lose more trade than we shall gain. What we want is industrial free trade without a "dear food" policy and without supranational control.
What about our balance of payments? Since devaluation it is agreed that the figure will be higher against us than the £500 million the Prime Minister said on May 8, 1967, in the House of Commons. Some estimates have been quoted lately that the figure will be £700 million; others say £1,000 million. Whatever the figure between the two, we shall have to have this burden put upon us. We have had a struggle in the last four years to get the balance we have now. We have had to have wages restraint, price rises, spending curtailed, to get where we are to-day, and our people have had to bear it. Do we go in the Common Market to carry this huge burden and have the people face all these measures to try to get us in balance again?
Worse than all this is the fact that, once we as a Parliament have surrendered our legislative powers by ratifying the Rome Treaty, we can never recover them. The Rome Treaty will not be altered to suit us. It would not be possible, as with other treaties, to leave it on due notice when it turned out to be unacceptable. Signing the Rome Treaty is legally irrevocable, with no provision for leaving it, as there would he if we signed other agreements in this country. Legally any country which finds the E.E.C. intolerable in practice—and I believe we should find this out—could not secede; and to sign the Treaty would be unprecedented. It would take out of the British public's hands forever a major part of their power to legislate on their own affairs, which it has taken centuries for them to secure,

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and grant it to a body in Brussels not responsible to them or even to the electorate.
I wonder, my Lords, why this is accepted by those who claim in the Lords, when the Government do anything they do not like, that they are the custodians to prevent the Executive from doing anything that smatters of taking people's rights away. Yet there are many who are prepared to give all this away in the Treaty of Rome. A decision to join this Market will be so contrary not merely to all democratic principles, but to the whole of our British Parliamentary tradition.
I believe it is intolerable that any Government should do this without first gaining the approval of the people. This is a unique decision that has to be made; the most important decision our country will be asked to make, if they get the chance, for many generations. I believe the case is strong enough for a referendum, as the Party system to-day does not present a clear and explicit choice being made by the public at a General Election.
We all know that the Conservatives have adopted a "dear food" policy in their import levies plan, and now their value added tax will make it much worse. We are aware that they intend to throw away the Agriculture Act, and are preparing the road to Brussels, but the farmers and the workers in agriculture had better beware if ever we join the Common Market. The public are aware of the high cost of food that will face them if we join the E.E.C. Many people have been abroad for their holidays and have had to pay high prices for their food. Hence the public have "tumbled" to it. If they are given the chance they will most certainly vote against going into the Common Market, because they do not believe there is a hope that we shall attain higher standards.
I should like to congratulate the Government on continuing the powers of the Coal Industry Act 1967 to March, 1974. The intention to support extra coal consumption on the part of the electricity industry is gratifying. So also is the announcement that Drax B electricity station will be coal fired. I should like to see more coal-fired electricity
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stations as I am far from convinced that the figures given for the costs of nuclear powered stations justify the rapidly increasing number of such stations.
The Minister said in another place that the Government intend to continue the ban on the import of coal and on the conversion of coal-fired stations to oil. This is indeed good news to an industry which has taken such a battering because of closures and which at the same time has increased its production in the face of ever mounting difficulties. No other industry has increased production in such a way, with the exception of agriculture. The Bill will also retain powers until March, 1974, to finance the scheme for redundant miners and to contribute towards the social cost of contraction incurred by the National Coal Board. I do not know how far this industry is to further contract. In the last 10 years 350,000 men have gone from the industry and the manpower figure now is near the 300,000 mark. The scheme for redundant miners is a good one for the miners affected. It is certainly more generous than we ever got in the past, because when we finished work we were thrown on the scrap heap with nothing. While I have disagreed with the Government over the too rapid closure of mines, I extend my thanks to them for the extended provisions of this Bill.
Men over 55 years of age who have been declared redundant are being looked after for three years until they can find a place in the changing pattern of industry, and for this we are grateful. Yet at the end of three years a man who has finished work at the age of 55 is only 58 and at that age he finds it difficult to get any job, let alone a less arduous one. After three years his unemployment benefit has expired, his 90 per cent, of his pay has gone, and if he cannot get work he is a National Assistance case until he is 65 years of age. At this age he is not a likely candidate for re-training, and he still has seven good years of working life in him. I suggest that the re-training of men made redundant should be one of the main objectives of our employment policy.
One of the most intractable problems of industrial change is the re-employment after redundancy of the older men and the disabled workers. The important point to emphasise is that an effort must

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be made to get rid of age discrimination in the employment of older workers. If this were done there would be more willingness on the part of these people to undergo re-training. The problem of the training and re-training of redundant disabled men, many of them very young, is much more difficult. The kind of jobs which can be undertaken by these people is limited, and the difficulty is not so much the provision of training as finding suitable work. I suggest that these two problems could be looked at, and more effort and more money expended to deal with them.
Another problem we have learned from experience is that of the younger men when a pit is closed. When a firm closes a factory the men are accepted as redundant from the standpoint of redundancy payments. In cases like this the redundant man is not offered work in the firm's other factories. When a man is declared redundant at a pit he is told that he can find a job at another pit. Further, he may be offered another job in another coalfield many miles away. In such circumstances, he is declared to be not redundant because work is there at another pit, a great distance away. This means that a man will have to move his family and obtain another house, or travel long distances to another pit, because so long as he is offered another job in another pit he is not declared redundant within this scheme. Also it has happened many times that a man has moved to another pit which has closed and he has again had to move. I know cases where this has happened to men four times since they were declared redundant at the original pit. I ask that consideration he given to the case of a miner who is declared redundant at a pit. He should get his redundancy pay straight away, without any consideration being given as to whether or not he can find another job at another pit. This at least would put the miner on the same basis as all the workers in private industry. I ask the Minister to give these matters his urgent consideration. I wish to thank the Government for introducing and extending the provisions of the Coal Industry Bill.
I should like to say a word on industrial relations. I thought the speech made by the noble Lord on the Cross Benches smacked very much of "Let's bash
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them". It did not seem to me to be a speech which was aimed at building up human relations but rather one with the intention of "get them in the courts and let's hammer them". Extravagant statements were made by the Leader of the Tory Party at Croydon last week, just before the mini-election, but neither those statements nor his policy of aggressive legislation will solve this serious question. He said that 1969 will be the worst year ever for strikes, and he called the situation one of industrial anarchy. We have had 2,181 stoppages in Britain in the first nine months of this year, and there have been 3,989,000 days lost. But Mr. Heath ought to have looked at the record of his Party, because when he was a member of the Government in 1957, 1959 and 1962, what was their record in the first nine months of those three years? In 1957, when the Tory Party was in power and its Ministers at that time were Mr. Macleod and Mr. Hare, there were 8,157,000 days lost. In 1959, there were 4,880,000 days lost in the first nine months. In 1962, there were 5,980,000 days lost. That was during the reign of the Conservative Party. There was no talk in those years that I heard of industrial anarchy, and those figures for those years are much worse than the figures for the year that the Leader of the Conservative Party said was leading to industrial anarchy.
There is no doubt that what is happening to-day is serious, and the nature of the disputes is changing. What we are witnessing to-day is an upsurge from the shop floor and the pit, and unofficial strikes being made official in many areas. All the threats of court action, penal clauses in legislation, will make matters worse. We had penal legislation in years that are gone, and it never led to any solution. Those who talk about taking the workers into court, as the noble Lord on the Cross-Benches did, ought to remember that powers exist to-day in the present law for the employers to claim damages for unofficial strikes. As I said in the debate on the Government's White Paper, I have myself been fined damages in my life, and that law is still there. To-day, employers can still prosecute workers who strike; but they seldom do. The reason is that when the strike is over, and damages are deducted by county court order from the man's pay,

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industrial relations become bitter. Employers have found out over the years that it really was not worth it.
The Conservative policy in this respect will do more harm than good, and they will find this out if ever it is attempted. Fear of prosecution will not stop men going on strike. They will not tremble at the idea of being taken to the county court. This threat will not deter men when they are feeling anger on the shop floor or at the pit. You could not take every miner, every dustman, every nurse or every fireman or docker to court if they came out on strike, and we all know this.
This year we have seen an upsurge from the lower-paid workers in industry because prices have been going up against them with practically no increase to meet it. In the main, the revolt has come from the bottom and not from the top. I believe that we have to adopt what was foreshadowed in the Donovan Report, and raise the status of the shop stewards on the floor. They have in the past been much maligned. They settle hundreds of problems each day in industry, and no credit is given to them; but if a strike takes place at any works they are heavily criticised by the Press and all those who think they know better how to handle it. I am pleased to see that some unions are recognising this and that some devolution is taking place to give more power to these men on the shop floor.
Since these unofficial strikes have resulted in some cases in wages increases quickly I am afraid that they might become the pattern; and it will not be good for the trade union movement. I believe that our trade union leaders at national level will have to face this new situation and draw up new procedures to meet it. In the old days, if a man led an unofficial strike, neither the employer nor the trade union leaders would do anything at all until the men went back to work. Action of this kind was small in those days; now it is gigantic. And trade unions are being forced to make such strikes official or to negotiate for unofficial strikers. That is the fundamental change, as I see it, that is developing in this country to-day.
The employers' organisations also will have to recognise this. They must not
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let negotiations drag on for months and then, when their industries are closed by unofficial strikes, settle within days, after months of negotiation by national leaders for their men. We shall have to do the same for the nurses—and here I speak to my own Front Bench. Do not let us, because of the nurses' loyalty to their profession, drag their case out until they become militant and then, if this should happen, settle the dispute in a couple of days. The first time the nurses demonstrated their position was in 1955, in the Selwyn Lloyd squeeze, when he offered them 6d. a day. In the last four years we have gone some way to meet the nurses, but they still rank among the lowly paid in our midst. I ask the Government not to exhaust their patience or their loyalty to the sick, but to meet their case now.
I believe that the new industrial charter will meet many of the grievances of the trade union movement, and I am pleased that the Government dropped the penal clauses. I am certain that the Tory policy on this will cause economic chaos. I would ask the trade unions and employers especially to recognise this new trend in human relations and get together to bring some peace in industry and also some order. The Government should give the C.I.R. more power and more work to do to help to this end and to bring procedures in industry up to date. The Government should see that the Prices and Incomes Board deal with prices as rigorously as they have dealt with the wages of the lower people. All will have to recognise that the wages of men and women in essential jobs who are lowly paid must be raised. The Prices and Incomes Board must see to it that justice is done, and must clear away from industry this awful feeling that if you are a worker you "get the hammer" from the Prices and Incomes Board. This is no easy job, my Lords. It will take time for the trade unions, the employers and the Government to get the human relations right. But if we all work together there is hope that we shall win through.
The true situation is not industrial anarchy. It is our industrial climate that is bad, and no amount of penal legislation will alter it. We all have to be fair in this, and those who are strongly organised must remember that there are others, not so strongly organised, who also have

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to have something. If we can get agreement on some restraints on high incomes, in the interests of fairness to others, and prevent inflation, I am sure that we shall all be doing a service to the nation.
8.0 p.m.
LORD GRANVILLE OF EYE: My Lords, this second day's debate has been concerned mainly with industrial affairs and industrial relations. I hope that my noble friend Lord Blyton will forgive me if I do not at this hour attempt to debate the very powerful case he has made against going into the Common Market. I shall have to leave that "hot potato" to my noble friend the Minister of State when he comes to reply. But I certainly agree with Lord Blyton that one of the very big problems in this connection is going to be that of agriculture. This was referred to by the noble Lord, Lord Brougham and Vaux, in his maiden speech, on which I congratulate him, in which he again stated the case for increased agricultural production as an import saver for this country. I look forward to many contributions from him in the future on this subject.
I was glad that to-day my noble friend the Leader of the House dealt again with this "March hare"—the attack upon the figures of the balance of payments. If anything was needed finally to dispose of that argument, he certainly produced it to-day. I imagine that it will now be relegated to, and lost in the limbo of, Smith Square. In the last two days of debate many speakers have paid tribute to our economic recovery. Particularly has this been so after the Chancellor's statement on Monday in another place, and after the publication yesterday of the gold figures. This has undoubtedly highlighted the fact that the economy of this country is certainly on the way up. I suppose that all politics are about power, and I can understand the Opposition adopting what they think is the right argument with which to bludgeon the Government. But, in my view, the attack which was made on the balance of payments figures will certainly not give them the power for which they are looking.
I should like to add my congratulations to the noble Lord, Lord Stokes, on his maiden speech. He spoke with great authority and experience, and I am sure that we all look forward to hearing more of his wisdom and fair-mindedness on
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industrial relations. I was glad that he highlighted this tremendous problem of industrial relations. While great strides have been made, and while there has been a great improvement in our economy, our balance of payments, our export figures, the invisibles and so on, this problem of industrial relations is the mountain which we have to climb. Of course we are not alone in this. Most large industrial countries have this problem. But I believe that this is the biggest problem that management, trade unions and the Government have to face in the next two or three years.
As my noble friend Lord Douglass of Cleveland and others have said, it certainly cannot be solved by legislation. In my view it can be solved only by an all-out effort by all concerned. I think that we shall probably have to look again at this problem. A great deal will depend on the calibre of future trade union leaders and—in the companies—of directors of labour relations in the new generation. You can merge, arrange your finance, design, plan and sell. You can do your research and your development. But unless you can "sell" it to the shop floor you are not in business to-day. As I have said, this is increasingly a problem which industry in all modern industrial countries has to face, and I think we have to take a special look at the type of men we want in personnel, as executives and directors of industrial relations in our large firms. I have been greatly impressed by some of the younger trade union leaders who are coming along. To-day, they not only have to understand productivity but also, in relation to the take-home pay packet, they have to understand incentives. To-day, no personnel manager can achieve that all-important efficiency without himself having made an up-to-date study of trade unions, their practices and their workings; and no modern trade union leader to-day can be efficient in his job, with its increased responsibilities, without a study of productivity and incentives.
I suppose that in industry the most important people used to be the cost experts, the production planners, the accountants, the cost accountants, and so on. They were the top people—perhaps they still are. But my advice to-day to any young man thinking of going into industry would be to go in for industrial and labour relations, because I believe

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that in the future this is going to be one of the most important jobs for higher executives, and even for boards of directors in large industries. As I have said, it will call for a new breed of labour relations executives. Perhaps, as a great friend of mine has always said, what it calls for from a managing director is rather more of an art than a science.
The noble Lord, Lord Stokes said that communication is the big problem. Of course it is. As he said, it is the problem of how to get over to the man on the shop floor, and to those at home, the prices and incomes policy and all that the Board of Trade have been, and are, doing for the export drive. It is the problem of how to get over what all this means to the balance of payments, to the problem of inflation created by the payment of increased wages. As my noble friend Lord Balogh said yesterday this problem of communication is still the vacuum to-day.
We talk a lot about communication, and about methods of communicating through various channels in industry. I think we have to face the fact that the main communication in every modern country today is broadcasting. The B.B.C. and I.T.V. have at their disposal a tremendous medium and, if I may say so in criticism of them, the fantastic, free publicity which they give to all kinds of wild strikes, unofficial strikes, or whatever they may be called, is unbelievable. A great deal of time is spent by the B.B.C. with their cameras in close-up and panning, in order to give this publicity to the country and abroad, where it is seen by millions of people. In fact, as one expert in public relations said the other day, the B.B.C., while they may not realise it, are in fact promoting, in the public relations sense, the irresponsibility of the very persons who are causing this trouble in industry. It is no good just passing round a leaflet. or a works newspaper, or publishing the annual reports of a company. The B.B.C. broadcasting and television and all these media of communication go into the homes of millions of people every day, both here and abroad, and I think that the broadcasting executives who are responsible ought to try to get their priorities right in a modern industrial State—what the late Poultenay Bigelow, a famous American, once called "Rule by M.O.B."
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When we are struggling with these problems of labour relations, we have to look also at what is behind the wages demand. Housing is a key factor. Mobile labour—and there is a good deal of this going on now in the development areas and so on—is paying high rents for furnished accommodation, and this leads to increasing wage demands. Credit affects everyone in almost every home to-day; increased hire-purchase charges for homes, cars, furniture and television have all to be paid for out of the wage packet, and that means fresh demands. This is a problem we must look at again. Credit is here to stay, and I believe we have to face the fact and realise what it means in the way of wage demands.
There is also the feeling among some people on the shop floor that there are too many people concerned with how to make what the Americans call "a fast buck" and we call here "a quick pound"; too many people unproductive; too many people living on the productive effort in industry. They are using cars, petrol, services. We have to ask ourselves, in this country of almost 60 million people, whether this is not too big a price to pay in the national overheads of a modern industrial State. If we are finally going to get this problem right we must learn to be a nation of industrial producers. We have perhaps to create a new élite as never before. We must get our priorities right and understood through whatever communication we can use, because "set the people free" to some has meant a "free-for-all", and "how to get it by any old means".
Finally, sooner or later, any modern industrial State is going to have to face the problem of a national wages policy. That has always been the hot potato. Nobody wants to know. The problem is a national wages policy in a free society. The steelworker, or the electronics producer, uses the same services as the bookmaker's runner, but they may be drawing much less at the end of the week. That is one of the things we have to look at when we come to face the problem, which many have tried to face in the past, of a national wages policy. In fact, of course, in a free society it begins at the schools.
I think that the Government have shown in the debate over the last two days that they are on the right road; but

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it is not enough to get efficiency in industry alone. Without improved efficiency in Whitehall and in the regions—to which my noble friend the Leader of the House referred in his speech to-day—we cannot get a completely efficient national effort. I hope that the recent Ministerial re-grouping under the two overlords, as they are referred to, will help to bring this about.
8.15 p.m.
LORD WINDLESHAM: My Lords, I should like to open by adding a tribute from this Bench to to-day's two maiden speakers. The noble Lord, Lord Stokes, speaking for the first time in this House, showed us some of the vision and qualities of mind that have made him one of the most highly regarded industrial leaders in Britain. The maiden speech of the noble Lord, Lord Brougham and Vaux. was very different from a notable performance by his ancestor, who was Lord Chancellor at the time of the passing of the Reform Act 1832. When the Bill was being debated in this House the Lord Chancellor, it is reported, went down on his knees in his peroration, begging noble Lords not to throw out the Bill. We take up the story from a contemporary account:
"Brougham ended with a prayer; he fell on his knees, and remained kneeling. He had kept up his energy with draughts of mulled port, and his friends, who thought that he was unable to rise, picked him up and set him on the woolsack."
LORD BROUGHAM AND VAUX: My Lords, I can assure your Lordships that those are high jinks in which I will not partake.
LORD WINDLESHAM: My Lords, by way of contrast the quiet and modest approach of the noble Lord was very noticeable this afternoon.
The Queen's Speech refers to the Government's intention to continue to develop policies for promoting the efficiency and competitiveness of industry. Even allowing for some doubts about the continuation of policies that have done so little to promote industrial prosperity in the past—Selective Employment Tax, Corporation Tax at 45 per cent., the imports deposit scheme—what is there in the long list of measures in the Queen's Speech which gives substance to the claim that the efficiency of industry, and its competitiveness will be improved?
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There is nothing, first of all, on prices and incomes. There is a reference to the merging of the Prices and Incomes Board and the Monopolies Commission, to which I shall refer later, but on the future of prices and incomes legislation itself the Queen's Speech is silent. Nor are there any proposals to tackle what several noble Lords to-day on both sides of the House have identified as the most urgent problem of industrial relations—indeed the Government itself identified it as the most urgent problem I of industrial relations only six months ago—that is the rising tide of unofficial and unconstitutional strikes. I shall be discussing the new Industrial Relations Bill in a few minutes, but it is worth getting clear one vital fact right at the start: there is nothing in the Queen's Speech, and there will be nothing in the industrial Relations Bill when it is laid before Parliament, that will deal in any way with unofficial strike action. There are a number of proposals in the Speech concerning changes in specific industries, both in the public sector (electricity supply, gas, the ports, nuclear fuel) and in the private sector—building and the film industry. Then there are the proposals on industrial safety and health which have been commented on by the noble Lords, Lord Crook and Lord Taylor of Mansfield in the debate this afternoon.
But at the end of a long debate in which a lot of ground has been covered, I should like to concentrate on only three issues which are central to the Queen's Speech, and which will affect industry as a whole. The first of these is equal pay for men and women. This is far from a new subject, much less straightforward than it appears at first sight, and one that raises the age-old problem of politics: how to reconcile idealism and ideals of social justice with practicability. Equal pay has been touched on to-day by a number of noble Lords. The noble Lord, Lord Shackleton, spoke about it briefly in his opening speech, and the noble Lord, Lord Crook, also mentioned it, as did the noble Earl, Lord Perth, and the noble Viscount, Lord Massereene and Ferrard. But I should like, just for a few minutes, to go a little deeper, and review some of the implications of the proposed legislation to introduce equal pay by 1975.

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I shall not go back into the history of this matter—there is a good deal of it—but since 1950 it has been accepted by both Parties that equal pay should be introduced as economic circumstances allowed. This followed on the Report of a Royal Commission in 1946 under the chairmanship of Sir Cyril Asquith. In 1955 Lord Butler of Saffron Walden, when Chancellor of the Exchequer—the noble Lord, Lord Thorneycroft, will probably remember this—announced proposals to implement equal pay in the Civil Service over a six-year period, from 1955 to 1961. Later the same sort of phased programme was introduced to include teachers and the local government service as a whole. This pace of advance may seem slow—six years for the non-industrial Civil Service, the same sort of period of time for teachers and local government officers, and now a proposed live-year period until 1975. Even leaving the economic implications on one side, which I want to turn to in a moment, it is worth remembering that public attitudes towards opportunities for women and the work they do outside the home change very slowly. This is a field in which the reformers tend to be drawn from mainly middle-class and professional women, who have tended to be some way ahead of what is known about the aspirations of the majority of women at work, and how they regard their own jobs. Therefore, if legislation is to be soundly based, it must take account of these factors, as well as of the costs involved, when the timetable is drawn up.
The costs to industry are going to be very large, and I do not believe the implications of equal pay are widely understood yet. A joint working party of officials from the D.E.P., the C.B.I. and the T.U.C. has inquired into the costs of equal pay and into the technical problems involved in its implementation. Although there is no agreed estimate of the direct cost in additional wages it seems that something of the order of between 3 per cent. and 6 per cent. will be added to the national wages bill. In round figures, this sum represents between £600 millions per year, rising up to perhaps as high as £1,200 millions. Therefore, if the benefit of incomes policy is of the order of 1 per cent. per year, an amount claimed by the Prices and Incomes Board, over a five-year
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period the cost of equal pay might extinguish completely the entire anticipated benefit.
Nor will the incidence of equal pay fall equally on all industries. In certain industries employing many women, but with some men doing the same work—such as retail distribution, light engineering, clothing, laundries—the costs, it is estimated by the joint working party, may go up by as much as 20 per cent. The joint working party went on to say that in individual firms within those industries the increased costs might vary between 0 and 30 per cent. in some firms, therefore, the wage bill might be as high as 30 per cent. higher. Clearly, increases of this order, particularly where they are likely to affect the competitiveness of the industries and companies concerned, both in this country and in some cases internationally, should not be overlooked. The period of five years envisaged by the Government, while it may seem slow, is in fact a minimum. I believe that initially it was thought that a shorter period might be feasible; but, for the reasons I have given, I am quite sure that five years is a minimum period of time for the effective realisation of a policy which is agreed by all Parties to be highly desirable.
The remaining problem—and it is a difficult one—is definition. Convention No. 100 of the I.L.O., about which one noble Lord (I think it was the noble Lord, Lord Crook) spoke, provides for equal pay for work of equal value, while the definition contained in the Treaty of Rome is based on equal pay for the same work. While there are arguments in favour of both these approaches, there is no doubt that the I.L.O. concept of work of equal value would be the more contentious of the two. It would involve very extensive job evaluation, and I am inclined to think that it would lead to considerable difficulties in application, both for employers and for the unions. The Treaty of Rome definition—that is, equal pay for the same work—has a number of advantages. It is more precise than the I.L.O. Convention, and is therefore capable of being more easily understood and applied. Secondly, its application depends on a judgment of fact rather than on a judgment of value, being less likely to give rise to disputes over matters of interpretation.

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It could be said that this definition should be widened. Indeed, I believe that the Government has considered widening the definition of "work of equal value" to include "broadly similar work". I hope that Ministers will think very carefully about this, because if the narrow definition is departed from difficulties of uncertainty in interpretation will arise. if there is to be a tribunal to decide on cases of discrimination, the definition contained in the Treaty of Rome—that of equal work—should be the one used by that tribunal. These are the reasons why I hope that when the Minister comes to reply on behalf of the Government he will be able (I have given him notice of this) to say something about what form of definition will be adopted. My Lords, when we talk of equal pay for women, there is rather more to it than may appear on the surface.
Next, my Lords, I should like to move on to industrial relations, which has been the main topic of the debate to-day. The noble Lord, Lord Delacourt-Smith, who is to reply for the Government, was regrettably absent from that football-team photograph which we saw in the Press the other day, of Mr. Wedgwood Benn surrounded by his senior officials and supporting Ministers. There are now seven Ministers in all at the Ministry of Technology—MAXTEC, as my noble friend Lord Erroll of Hale called it in the debate yesterday. I understand that, in addition to his responsibility for Aviation, the noble Lord, Lord Delacourt-Smith, is to be given the special job of trying to forge better links between the T.U.C. and the Government. A fairy godmother, in the shape of Mrs. Castle, must have been presiding over the noble Lord's ministerial rebirth. For who could have hoped for a spoon so thickly plated with silver as the proposed Industrial Relations Bill? His task is going to be a very simple one.
For what is going to be in this Industrial Relations Bill? Parliament has not been told yet, but it has appeared in the Press. We can assume that most of the things which the unions liked best in the Donovan Report, and in the White Paper which followed it, are going to be included in the Bill. Some details have already appeared in the Financial Times and The Times. The Bill is expected to
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establish every worker's right to belong to a trade union. It will move a long way towards making union recognition compulsory; it will give union negotiators the right to information about their company; it will give workers the right to appeal against unfair dismissal, and it will make the Commission on Industrial Relations a statutory body. If this is to be the content of the Bill—and it certainly seems likely, because these items were the palatable elements of the earlier proposals contained in the back of the White Paper—In Place of Strife—they are very substantial benefits indeed. What is more, the Government know that they are very substantial benefits.
Last Session, in the White Paper, the Government sought to balance these improvements in the unions' position with proposals for dealing with unofficial and unconstitutional strikes. The White Paper demonstrated that the total number of strikes had gone up considerably. A statistic of the utmost significance was that 95 per cent. of all strikes were unofficial, in the sense that they had not been sanctioned or ratified by union officials, and nearly all were unconstitutional as well, in that they took place in breach of agreed procedures for dealing with disputes.
To deal with this situation the Government came forward with the proposal that the Secretary of State should be able to order a 28-day conciliation pause; that in this time consultations should take place, while unofficial strikers returned to work and desisted from taking industrial action. This power would be backed up by the imposition of financial penalties if the order was not complied with. That was the first specific proposal. The second major concession which was required of the unions was to accept that, in certain defined circumstances, the Secretary of State should have power to order that a strike ballot should be held.
These were the two quid pro quos that the unions were asked to accept. The Prime Minister left no one in any doubt about their importance. My noble friend Lord Dundee, in his opening speech this afternoon, referred to the Prime Minister's statement when he met T.U.C. leaders in May. On this occasion he said that proposals contained in the White Paper were "essential to the continuation of

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this Government in office". Mr. Wilson left no doubt of their importance. Those were his actual words. Yet in June, the following month, the Bill was dropped in the face of determined opposition from the unions and from the Government's own Back Benchers.
Since then Mr. Feather has certainly done his best to honour the "solemn and binding" undertaking given by the T.U.C. to try to persuade unofficial strikers to return to work. But he is faced with an impossible job as he uses all his efforts to honour the undertaking that he and his colleagues in the General Council have given.
Meanwhile the problem of industrial disputes is becoming more and more acute. Figures for the period up to the end of 1968 were published at the back of the White Paper (Cmnd. 3888, p. 39). If those figures are projected forward—these are the official figures taken from the D.E.P. Gazette—it shows that the number of stoppages and working days lost is moving unmistakably upwards. Between January and June, 1969, the number of strikes increased 67 per cent. against the average for the six months period.
At that precise moment, when the trend was already apparent, the Government withdrew. Since then, not unexpectedly, the pace of industrial unrest has quickened. The figures for the third quarter of 1969, from July to September, show no fewer than 724 disputes against a quarterly average (for the previous eight years) of 329. This total, excluding coal mining, represents an increase of 120 per cent. The statistics for working days lost show the same trend.
The seriousness of this position does not seem to be challenged by Ministers. Mrs. Castle made a speech to the Industrial Society on October 22 last during which she referred to what she called,
"a spate of unconstitutional strikes in various sectors of industry".
She said they fell into two categories. The first concerned the lower-paid workers, while the second and larger category she described as follows. These were the words of the Secretary of State herself, but they could have come from a Member of these Benches:
"As usual, they are mainly unofficial and unconstitutional and they are increasingly
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about pay. They reflect an increasing tendency for local groups of workers to take the law into their own hands and defy the attempts of Vic Feather or their own union officials to get them back to work again."
To-day, we heard the noble Lord, Lord Stokes, with all his knowledge of industry, refer to unofficial groups pressing what he called "piratical claims" in breach of agreed procedure.
My Lords, who can quarrel with this analysis? It is contained in the White Paper. The Secretary of State herself accepts the upward trend; while industrialists with the experience of the noble Lords, Lord Stokes, Lord Thorneycroft and Lord Watkinson, have come here to say the same to-day. Yet faced with this situation the Government are going to produce a Bill which will not in any way deal with this central issue of unofficial or unconstitutional strikes. It will deal with what the unions wanted in the White Paper, but not with the essential issue facing Britain to-day.
My Lords, I turn finally to prices and incomes, that other cornerstone of Labour policy. While there is no mention of the words "prices and incomes" in the Queen's Speech—a notable omission, one would think—the Prime Minister told the House of Commons last week that Part II of the Prices and Incomes Act 1966 would remain in force for a few months after the powers to delay price and wage increases lapse in December. New legislation to merge the Monopolies Commission and the Prices and Incomes Board (as forecast in the Queen's Speech) will be laid before Parliament. When this comes into effect, presumably in the middle of next year, the existing Prices and Incomes legislation will lapse.
My Lords, after that, everything is obscure. I cannot believe that I am alone in this House in finding it very difficult to see how a merger of these two institutions will take the place of the present mandatory legislation controlling prices and incomes. I suspect there is a very real change of Government policy here; but, as with the switch in policy towards the unions last summer, the Government have disguised it. There is clearly some logic in joining together the two bodies. But this seems to be a quite different line of reasoning; the merger of these institutions cannot surely have an effect similar to the Prices and Incomes Act as it

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has operated over the last two and a half years.
The noble Lord, Lord Shackleton, referred to overlapping inquiries by the Monopolies Commission and the Prices and Incomes Board. Yet there are considerable differences between the two. The Monopolies Commission is now fairly old—it has been going for 21 years—it has a rather small staff and it is backed by statutory powers, but is able to make only limited use of them. The P.I.B. is newer and larger and under the exceptionally vigorous chairmanship—this will be accepted by noble Lords on both sides of the House—of Mr. Aubrey Jones it has developed flexible and advanced methods of inquiry. But I believe that, behind all the arguments in favour of rationalisation, there is an attempt to counteract the pro-monopoly influence of the Industrial Reorganisation Corporation, which will now function under the wing of the Ministry of Technology.
It is ironic that while one part of Government is busy promoting mergers into larger units in order to accelerate the processes of innovation and encourage greater competition in international markets, another part of Government should be concerning itself with the prevention of what is now called "the abuse of market power". The medium-sized to large company which is likely to find itself in the crossfire between these two bodies, is going to become increasingly exasperated, I fear, over these well-intentioned, if at times contradictory, efforts by the Government to lend a helping hand. It is for this reason particularly unfortunate that it is planned to put the new body under the Department of Employment and Productivity. The noble Viscount, Lord Watkinson, dealt with this in his speech.
As noble Lords on the Government Front Bench know, there has been a great deal of opposition to this proposal—almost uniformly so—since it was first made known. I hope that there may still be time to think again. The consultations on the merged institutions, as I understand it, are only just beginning, whereas those on equal pay have been going on for a year or two. Surely if consultations are just beginning with the C.B.I. and other interested parties it would be more appropriate that a decision
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on this matter should arise out of the consultations, rather than be taken before they began. The Board of Trade, despite its present reduced status, remains the sponsoring Department for most of industry and has built up over the years extensive industrial contacts and a good deal of expertise in industrial and commercial processes. On the other hand, in spite of its recent association with incomes policy, the D.E.P. still tends to see its role as one of conciliation and as being primarily concerned with the settlement of strikes. I should like to underline as strongly as possible what was said by the noble Viscount, Lord Watkinson, that it would be far better to keep these two functions apart.
In conclusion, my Lords, the noble Lord, Lord Stokes, mentioned that in industry, to be successful, any policy must be consistently pursued. This is also true of public policy. It is essential to be clear about the main aims of policy and to concentrate on achieving them. And if the big things can be got right, then some of the smaller ones which depend on them may follow without too much difficulty. It is for this reason that the Government's lack of any stated policy towards two of the major issues of the day—prices and incomes, and unofficial and unconstitutional strikes—makes the part of the Queen's Speech dealing with economic affairs so very disappointing to us on this side of the House.
8.42 p.m.
THE MINISTER OF STATE, MINISTRY OF TECHNOLOGY (LORD DELACOURT-SMITH): My Lords, it can never be easy to reply in your Lordships' House to a debate of this character. As the evening wears on one is, I think, bound to find one's notes becoming increasingly complicated, and one speculates more and more frantically on the tantalising question of how many noble Lords will actually be present to hear the reply. Perhaps it is particularly difficult to-day, because we have had a very wide-ranging debate and a number of contributions of the highest quality and authority. I know that noble Lords will forgive me if, especially at this time of night, I am not able to reply to, or comment individually on, every point which noble Lords have raised. But I certainly hope to comment on some

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raised by the noble Earl, Lord Dundee, and by the noble Lord, Lord Windlesham.
I must begin by adding my warm congratulations to those which have already been expressed to noble Lords who have made maiden speeches. The noble Lord, Lord Stokes, sent a note explaining that owing to a very important commitment connected with the export effort, which he could neither rearrange nor possibly cancel, he would have to leave the House before the conclusion of the debate. From the reception given to his contribution, and from the many observations that noble Lords have made subsequently, there can be no doubt about the high value we all set upon it. The noble Lord's speech was delivered in the light of great industrial experience and eminence, and I echo the words of those noble Lords who have expressed the hope that, notwithstanding the wide range of public service which the noble Lord undertakes in addition to his heavy industrial responsibilities, there will be many occasions when he will feel it appropriate to contribute to our debates.
I add my congratulations to those extended to the noble Lord, Lord Brougham and Vaux. I think that the House is particularly attentive to those who plead the cause of agriculture, and I am sure that noble Lords will join me in hoping that the noble Lord will contribute many times to our debates on matters which are close to his heart. I was struck by the anecdote recounted by the noble Lord, Lord Windlesham, about an ancestor of the noble Lord, Lord Brougham and Vaux. If my memory serves me right, the touching incident to which reference was made came at the close of a speech which lasted for three and a half hours.
My Lords, as the noble Earl, Lord Jellicoe, made clear at the outset of the debate and of his speech, we are at one in welcoming the trade figures, with the effect that they have on the balance of payments and the prospects which, in the Chancellor of the Exchequer's view, they hold out. But it is perhaps in the nature of things that there may be some who appear to find it easier to contain their enthusiasm than do others. In the wide-ranging debate that we have had there was a forceful contribution from the
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noble Lord, Lord Thorneycroft. I was not altogether sure sometimes whether the noble Lord was addressing himself to the policy of Her Majesty's Government or to the terminology of a discussion publication of the Labour Party. But there was one observation he made which I must confess pained me. The noble Lord charged the Government with having made it more difficult, or at any rate with not having made it any easier, for industry to find its way round Whitehall. It was a major aim of the reorganisation from which the Ministry of Technology has emerged in its new and expanded form to focus the points of contact which industry would particularly need to have with Government Departments, and to bring so many of the major contacts in industry under the direction of one Department of Government. Indeed, the major aim of the Ministry of Technology is that of building up a widely based partnership between Government and industry; and in the tone and spirit of some of the noble Lord's comments I could not always recognise the kind of relationship which I believe exists between the Ministry and a very wide range of industry.
The Ministry will continue to use the considerable variety of methods to encourage and assist industry to reorganise and increase its "R and D" effort and to improve its competitiveness. I welcomed the reference made by the noble Lord. Lord Stokes, to the Industrial Reorganisation Corporation and the rather oblique praise extended to it by the noble Lord, Lord Thorneycroft. Along with the National Research and Development Corporation it is an important instrument for intervention. At the time when it was brought into being it had a somewhat dusty welcome from the Benches opposite, but I hope that both these institutions may now be regarded as well-established and well-accepted parts of the industrial scene.
There cannot be any doubt that the policy of working with industry in this way to help it in what it recognises so widely to be its own tasks offers the best hope of sustained growth, of higher investment—about which I will say a word or two later—and of greater employment. In many fields we can see a practical result. In electronics, for example, the N.R.D.C. is investing nearly

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£5 million in the field of micro-electronics, and the three leading British firms have already invested some £10 million. By the early 1970s the sales value of the United Kingdom market in this growing field is likely to exceed £20 million a year. It is worth while to look at the export contribution of some of the industries in which there has been a substantial degree of Government interest and sometimes Government intervention. In computers, exports are up from £10 million in 1964 to over £40 million in 1968. In electrical engineering, exports are up from £360 million to £515 million; in shipbuilding from £15 million to £51 million; and in aviation from £98 million to £253 million, with an outstanding export order book in the middle of this year of £547 million. So my Lords, if I may say so, there are some industries which are succeeding in staggering along to some purpose.
I was asked particularly to make a comment on investment and I would say that the Government see no evidence of an investment slump. This is not a field in which the Government are likely to be complacent. They have a real knowledge of the importance of the degree of industrial investment. It is true to say that over the last 18 months the underlying trend of investment has strongly improved. The figures are somewhat complicated, but I think it is fair to say, bearing in mind that there were certain special factors operating in the last quarter of 1968, that the second quarter of 1969 shows, on a seasonally adjusted base, an all-time record in investment. So here again I think we may say that there is evidence of some practical concern and practical results.
In other circumstances I should have wished to speak at some length about the production and consumption of energy. Suffice it in the present circumstances to say that a series of proposals, some requiring legislation, are embodied in the gracious Speech addressed to the various differing needs of the energy-producing industries. My task in this regard has been made much simpler because the references which I should have wished to make to the coal industry have been largely anticipated by my noble friend Lord Blyton, and we appreciate very much the warm welcome which he gave to the provisions of the proposed
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Coal Industry Bill. In respect of gas, electricity and atomic power there are proposals which are concerned to strengthen the essential base which the energy producing industries must constitute in any period of industrial expansion or in any period of rising standards of comfort in the home. It is material in this connection to know that the energy-producing industries in the last five years have shown in their varying degrees productivity increases satisfactory in every case. I would particularly mention last year's increase in productivity of 9·2 per cent. in the coal industry.
I turn to the field of regional responsibilities and policy, to which the Government have attached and continue to attach great importance. This afternoon the noble Earl, Lord Dundee, addressed himself for a substantial part of his speech to the development areas, and we appreciate very much the common ground and common objectives which exist between the two sides of the House in this field of policy. Both sides recognise that this must be an essential part of regional economic policy. As the noble Earl pointed out, there is room for legitimate differences of opinion about the merits of particular methods of reaching the common objective. In particular, the noble Earl criticised the broad spread of the present development areas and indicated a preference for concentrating on growth areas. This is a matter we could debate, but I am sure the noble Earl will forgive me if I remind him that we moved away from the former Government's rather narrower development districts, which incidentally were designated regardless of their prospects for growth, because we felt that it was desirable to plan for substantial regions as a whole and to spread industrial development within broader areas, according to the needs and resources of each of them.
The noble Earl expressed some fears for the grey areas in the light of existing policy. As he knows, there is under discussion in another place a Local Employment Bill which will deal specifically with the position of the grey areas. We cannot dogmatise about the effects which this will have. Some measures to assist the grey areas, to bring them, for example, on to the same footing as the development areas in respect of the issue of industrial development certificates,

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have already been taken, and in so far as one can make any judgment the signs are that these measures are working. But, of course, the major measures in this field will come under the new Local Employment Bill.
The House is aware that unemployment has risen in the country as a whole. To some degree this is reflected in the development areas, as the noble Earl, Lord Jellicoe, mentioned yesterday, and he particularly referred to Wales and Scotland. The position is, as again he will be aware, that to some degree the disparity between Scotland, Merseyside and other development areas, and the rest of the country in relation to the percentage of unemployment has been reduced over the last five years. To take the case of Scotland, the figure is now something like half as much again as in the rest of the country, instead of being one and a half times as much again, as it was in 1964. One-fifth of our population lives in development areas, and their share of the estimated additional employment created through i.d.c. approvals is running at about half of the whole total.
I am anxious to come on to the question of industrial relations, which has occupied, very understandably, an important part of our consideration of the gracious Speech, but before I do so I should like to emphasise one or two points about the effect, feared in some quarters, of the machinery of Government changes upon development area policy. These changes imply no change in the general priority which the Government are giving to achieving a substantial and permanent improvement in the economies of the development areas. The new arrangements mean that with responsibility across the bulk of industry both in the private and the public sectors, the Minister of Technology can ensure that national industrial policies and regional policies are thoroughly complementary. In practice, this means that proposals for expansion, for rationalisation and for change in industry will be considered with full awareness of their implications for the development areas.
These areas are receiving direct preferential assistance to industry at the rate of some £270 million a year. This represents about one quarter of the total direct
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Government assistance to industry and is a measure of the importance which the Government attach to helping the development areas to overcome their problems. On the administration of I.D.C. policy, the Government have stressed that general priority will continue to be given to the development areas and now to the intermediate areas, but they have also underlined that development areas will still enjoy a massive preference in financial assistance to industry over the rest of the country, including in that the intermediate areas.
Before I come to the question of industrial relations there are two further comments I would make by way of proper preliminary. Apart from the measures embodied in the gracious Speech dealing with the merchant shipping industry and with labour-only subcontracting in the construction industry, I feel that two of the contributions to our debate are particularly appropriate as preliminaries to examining industrial relations. I refer to the speeches of my noble friends Lord Crook and Lord Taylor of Mansfield. I shall come in a moment to the speech of my noble friend Lord Douglass of Cleveland. My noble friend Lord Taylor of Mansfield asked me specifically about emphysema, about duputreyns contraction and about latent compensation cases. As he indicated, these are three difficult questions, and in the case of the two diseases he mention, research is still proceeding. But I felt that his speech, in which was expressed his knowledge of humanity, was a reminder to us of the cost in human terms which our industrial development has sometimes had in the past.
My noble friend Lord Crook, who has, I think, sat through the debate from beginning to end, dealt with the question of health and safety. I am sorry to have to tell him that I am advised that what he described as the short Bill will be coming before us, but it does not of itself, as at present drafted, contain the kind of provisions in respect of fire risks for which he was asking. But it will provide for the establishment of consultative committees, which might well interest themselves in the question of the prevention of fire hazards.
I should like now to come to the question of industrial relations, to which so many noble Lords have referred. Much

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criticism has been levelled at the Government because of the state of industrial relations as indicated by the statistics on strikes. The number of strikes and their duration is certainly not the only index—it is not, perhaps, even necessarily the most important index—of the state of industrial relations, as I shall try to argue later. But we ought to know what the situation actually is.
Here again I have been anticipated by my noble friend Lord Blyton, because I had been intending to refer to a speech recently made in the country by the Leader of the Opposition in another place; to refer to the figures he quoted in that speech, and to quote some further figures which perhaps put them more in perspective. The Government have made very clear the serious view that they take of industrial disputes and of the loss of production to which they give rise. But, even taking that into account, we ought not to talk ourselves, or allow anybody to talk us, into the belief that some degree of industrial anarchy quite unparalleled in our history is indicated by the recent outbreak of strikes.
A certain amount of time is lost in strikes. My noble friend Lord Crook (I think it was he) pointed out that a great deal more is lost by illness and injury; and it can be argued that a good deal is lost by inadequacies of management. But the time lost by strikes, even when one takes into account time lost through other causes, is important because of the disruptive effect it has on industrial schedules, and because very often the incidence of the stoppage is not altogether easy to predict. Often the time lost in strikes is important—not so much in itself, but as an indication of bad industrial relations, and of the friction and waste to which these give rise, even when they do not actually express themselves in stoppages. I think the point ought to be recorded that noble Lords on the Opposition Benches are by no means entitled to imply that they have some panacea for this which in some obstinate way the Government are refusing to recognise.
The issue of the contribution which some greater legal intervention in strikes could have is one that could be debated at great length. I somehow do not think that in the time at my disposal I am going to persuade noble Lords who hold
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strongly to that belief to reverse their opinion. I listened with great interest to the contribution of the noble Viscount, Lord Watkinson. He speaks, of course, with the authority of someone of long ministerial experience in Ministries concerned with industrial relations, and I shall study his speech carefully when it appears in Hansard. But I am bound to say that, hearing his proposals across the Floor of the House, they appeared to me to invoke the idea of legal intervention as a panacea in an even more legalistic form than any previous expression that I have heard. But, as I say, I wish to study these proposals more fully when I see them to-morrow.
For those noble Lords who hold the view that there is some panacea, as seems to be implied so often by Conservative propaganda, I do not think I can do better than to recommend to them the speech made in this House some months ago by the noble and learned Lord, Lord Donovan. We were asked to-day by one noble Lord whether it would not be a good idea to have an examination of the legal position of trade unions. I thought that that was what we had been doing for years, as carried out by the Donovan Commission. The noble and learned Lord, Lord Donovan, with his legal knowledge, and the great experience which he gained by presiding over that Commission, made in your Lordships' House a speech which is very striking in bringing out the practical and technical objections to the idea which is so light-heartedly put forward, that there is some relatively simple legal solution to this. I submit that it is necessary to go beyond the figures, because they can be interpreted in many ways. It is necessary to go beyond the figures and facts of the industrial disputes themselves, and to look at the malaise which exists in some fields of industry—not in all—of which industrial disputes are the symptom. The only way effectively, satisfactorily and permanently to reduce strikes is to work at the causes of this deeper malaise, which, as I say, some, but not all, fields of industry exemplify. It is this malaise which delays and sometimes precludes the introduction of new working methods and new equipment; it produces a lack of co-operation and a lowering of morale. Sometimes it is better, quite frankly, that conditions like that should find their expressions in

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a strike rather than go on, in the long run, to do far more damage under the surface to the industry in which those conditions exist.
This problem will not be solved by gimmicks; it will not be solved by slogans. I doubt whether it will be solved by a further examination of the law by lawyers. I do not think it will be solved by pretending that the modification of the law can easily solve it. This malaise arises where men feel, for example, that they are in danger of losing their jobs and see no prospect of getting comparable ones; or where they feel that the dice of society are loaded against them and that whatever efforts they make, they will not really raise their standard of living or their status where; they feel that they have no say in the broad conduct and organisation of the industry to which they have committed their lives, or where they feel that management and supervision are cynical and poor, and that time and effort is wasted. My Lords, it is causes like these, which are deep, that are at the root of those elements of frustration in our industrial relations. The noble Lord, Lord Stokes, touched on this, as did the noble Earl, Lord Perth, in talking about the need for communication, and in talking again like the noble Lord, Lord Stokes, about the old tradition of "we" and "they".
In addition to all this we are passing through a time of very rapid industrial change in the national interest, and in the interests of all sections of the community. That pace of change ought to be maintained, and indeed accelerated. To the individual worker, industrial change can often present itself as a source of individual anxiety which he looks to collective action with his fellow workers to allay in one fashion or another. The background of these industrial problems is a complicated one. We are dealing with people, as the noble Lord, Lord Stokes, reminded us, and as many noble Lords have echoed. It is against this background that the industrial relations policy of the Government is conceived, and it is against this that it makes sense.
In many cases, our procedures and the institution of our industrial relations have not kept pace with the realities of industrial change, technical change or social
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change. When I hear some noble Lords offering as a contribution to solving this problem the suggestion that we should find a way of precluding people who are on strike from having social security benefits or supplementary benefits, I am tempted to wonder whether some noble Lords are completely in touch with current social realities. Our tradition in industrial relations is a voluntary one, and it would be a very substantial change in our society, and not a change for the better, if we set seriously about changing that voluntary basis.
The noble Earl, Lord Dundee, asked what the Industrial Relations Bill, mentioned in the gracious Speech, would include. It is intended to give effect to many of the proposals in the White Paper, In Place of Strife, excluding those overtaken by the June agreement with the T.U.C. It will have three main purposes: to encourage the development of collective bargaining; to extend the protection of individual employees and to clarify certain aspects of the existing law governing trade unions and industrial disputes. I believe it will serve a useful purpose in our industrial relations when we remember (and I do not think any noble Lord has mentioned this point in the course of this debate) that one recent strike was caused because an employer refused to recognise a trade union, although he was not seriously disputing that his workers wanted to join the union. There is a need perhaps for changes in attitude, and some changes in the law. Discussions with the T.U.C., the C.B.I. and nationalised industries on this subject are about to be undertaken, and they will be followed by the Ministerial decisions on the final form of the Bill.
That reference leads me very naturally to a consideration of the events of last June. We cannot for one moment accept the view expressed by the noble Viscount, Lord Watkinson, and echoed, I think, by the noble Lord, Lord Thorneycroft, that industrial relations have been worsened as a result of the events of last June, and the events which led up to the undertakings given by the Trades Union Congress. I feel that many of the contributions made in this debate have misunderstood and misconceived the effect of that understanding. It is easy in a melodramatic fashion to present events

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which followed the publication of the White Paper in terms of conflict, triumph and defeat. It did not really look like that to those who were engaged in any degree at all in those transactions.
The understanding which was reached between the Government and the trade union movement was not a face-saving formula; it represented a very important change indeed in relationships within the trade union movement and in the responsibility of the General Council for the movement as a whole. Only those who appreciate how immensely strong the tradition of the sovereignty of individual unions has always been will grasp the long-term significance of these changes.
It would have been naïve—and still is—to assume that the effects of such an agreement can be judged on the experience of three months. I think it ought to be firmly put on the record that the trade union General Council has abided loyally by the spirit of that agreement and, particularly in the person of its General Secretary, has been most active in seeking to assert it. It was not an undertaking or an agreement to intervene in every dispute. And of course there arises a factor which again one of my noble friends mentioned: that the trade union representative always finds cast upon him the responsibility for an industrial dispute, but never receives credit for the very many situations which could so easily develop into an industrial dispute if constructive, reasonable, statesmanlike approaches were not undertaken.
My noble friend Lord Douglass of Cleveland, I believe, gave a very real indication of some of the practical problems which a trade union general secretary, or indeed a trade union representative at any level, must face. I believe that my noble friend's contribution deserves very close study by those who seem to be under the impression that there is some easy solution which could be applied to this problem if only the Government were not so pigheaded as to refuse to apply it.
The basic industrial relations policy of the Government is a right one, but it is a problem to which all concerned must make a contribution. I do not think that we can seriously accept the view which was expressed by one noble Lord, that this is a matter only for the Gov-
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ernment. Each side has a contribution to make. The Government have a contribution to make by their general economic policies and by their policies of social security; by the work of D.E.P. and the work which we are seeking to develop in the Ministry of Technology (and the noble Lord, Lord Windlesham, was kind enough to make a reference to this) to bring the trade unions more effectively into discussions on broader questions of industrial policy and industrial structure than has hitherto been the case.
Trade unions have a contribution to make by pressing on with their work of improving their own structure; effecting their own reorganisations, modifying their practices and developing the services which they give to their members. And the employers have a contribution to make by enhancing the importance which they attach to personnel management and industrial relations aspects of management; by improving the organisation of industry—and I think we ought to remember some of the comparative figures about wage levels which my noble friend gave us earlier; by the selection and training of supervisors, and by showing in practical terms that they respect and recognise the commitment to industry of so many of those who work in it at the shop floor level, and to be prepared to take them into effective discussion on matters which it is sometimes thought proper to regard as just the prerogative of management.
The noble Lord, Lord Windlesham, asked me some specific questions, first of all on equal pay and then on the merger of the N.B.P.I. and the Monopolies Commission. So far as equal pay is concerned, the Government do not propose to adopt the Treaty of Rome definition of equal pay, but the legislation will be such as will enable us to ratify the International Labour Office Convention No. 100 on the subject of equal pay—a point which will give great satisfaction to a number of noble Lords on this side of the House, and particularly. I know, to my noble friend Lord Crook. It will also enable us to satisfy the requirement of the Treaty of Rome in this respect.
So far as cost is concerned, of course we appreciate the point, which is a very clear and apparent one, that the cost will vary industry by industry and, to some

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extent, firm by firm. The Government, however, assess the cost of equal pay, over the whole wages bill, as probably ranging between 3 per cent. and 4 per cent. This gives an annual rate of less than 1 per cent. per annum over the period of implementation, which in our view ought to be largely absorbed by the expected improvement in the efficiency of labour and by the more economical use of the labour of women.
The noble Lord, Lord Windlesham, also asked me about the arrangements for placing under the Department of Employment and Productivity the proposed new body replacing N.B.P.I. and the Monopolies Commission. The position is that my right honourable friend the Prime Minister is satisfied that the D.E.P. is the best Department in which to place responsibility for this body. There is always scope for argument about which is the right Government Department for an agency with wide-ranging economic responsibilities, but the new body will be concerned with a wide range of functions centring on the efficient use of resources, and particularly of labour, in the private and the public sector. It will have a central role to play in developing an incomes policy in relation to pay structures and negotiations, and this is obviously related to the work of the D.E.P. The new body will be concerned with many aspects of improving efficiency, and this links with the manpower advisory work of the D.E.P. and with such bodies as the British Productivity Council.
It is further removed, of course, in so far as its work is concerned with mergers and industrial structures, from present D.E.P. responsibilities, but it is also fairly well removed in that respect from the Board of Trade. I think this coincides with a point made by the noble Lord, that there is a strong case for considering that the regulatory aspects of work on industrial structures should be separate from those Departments concerned with positive initiative, for example through the I.R.C., or in other ways, which may lead to the building up of
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larger, more substantial industrial structures.
My Lords, I have detained you longer than I should. I have tried to answer, to the best of the time available, points raised by noble Lords. I would merely conclude by echoing a point which I think was made by my noble friend Lord Beswick and has been made by other noble Lords in the course of the debate. The degree of success in achieving a solution of our problems and achieving progress, rests not upon what the Government do alone; it rests upon the efforts of millions of people in all kinds of positions in varying degrees of authority and varying occupations throughout the country. Over most of the field the Government cannot dictate and they certainly cannot dragoon, but more and more it has become clear in the post-war years that if this country is to secure stability and success it will have to be on the basis of themes which are struck and priorities determined by the Government of the day, whatever that may be.
This Government have made their priorities very clear: they are industrial priorities, they are social priorities. Their character is well known, and I believe they are priorities which are accepted as such by the overwhelming majority of the people of this country. I venture to submit to noble Lords that this debate has shown beyond question that the Government have the capacity, the will and the determination to carry on with these tasks to their accomplishment.
On Question, Motion agreed to, nemine dissentiente: the said Address to be presented to Her Majesty by the Lords with White Staves.

GLASGOW CORPORATION ORDER CONFIRMATION BILL
Brought from the Commons; read 1a, and (pursuant to the Private Legislation Procedure (Scotland) Act, 1936) deemed to have been read 2a and reported from the Committee.
House adjourned at twenty-five minutes past nine o'clock.