HL Deb 12 March 1973 vol 340 cc29-93

3.50 p.m.

Committee stage resumed.

EARL JELLICOE

I think it was the noble Lord, Lord Shinwell, who was saying just now that he was awaiting impatiently the Government's view on these three Amendments. In response to that invitation, I may say that I feel that this has been an interesting debate on Amendments which have engaged the deep interest of the Committee and which clearly are worthy of careful consideration. That I propose to give them. First, may I say that I am grateful to the noble Lord, Lord Wigg, for the way in which he moved his Amendment and for his readiness to have it considered along with the Amendments standing in the names of his three noble friends. He prefaced his remarks with three general observations, two of which I happen to agree with and one from which I happen to dissent. In the first place he expressed his mitigated belief—I may be giving him discredit here—in a mixed economy and his desire (which I share) to see that mixed economy works and to have imparted to it the maximum amount of dynamism. I agree with his general standpoint here. Secondly, he expressed his preference (one with which I agree and one which I know is not shared by all noble Lords) for the voluntary approach towards a prices and incomes policy if one can be obtained. I agree with that too; and I happen also to agree that we should do everything possible to come back on to a voluntary path as soon as possible.

However, he also said—and this is the proposition from which I dissent—that there had been no meaningful discussion between the Government and the T.U.C., for example. I happen to dissent from that and I personally believe that the whole history of the Chequers discus- sions and the tripartite discussions which followed them belies that statement of the noble Lord, Lord Wigg. I sincerely believe that no one could have tried harder than did my right honourable friend in the discussions with the C.B.I., with the retailing organisations and, not least, with the T.U.C., to see whether a voluntary policy could have been agreed upon. I also think we came close to such an agreement in the late autumn. I ask the noble Lord to accept my sincerity on that as I accept his sincerity on his contrary view.

I think my noble friend Lord Amory also said something with which everyone in this House would agree. It was his desire that, on whichever side of the political fence we stand and whatever ideological stance we may have taken up in the past and may take up now towards a prices and incomes policy, be it voluntary or statutory, in the very serious national situation in which we find ourselves we should do our utmost in this House to help towards making work the policy on which we are now embarked. I happen entirely to agree with that general viewpoint. I think it was the noble Lord, Lord Douglass of Cleveland, who, perhaps rather mischievously in a constructive speech, suggested that the only reason why we had not established from the start (or had not sought to establish from the start) the joint commission which both Amendments call for was cosmetic and political. Having shown ourselves to be inconoclastic in the past, he was suggesting that we were not wishing to establish something which might look very much like something we abolished a couple of years ago. I am not necessarily against cosmetics. I recognise the importance of cosmetics in politics as I believe must every practitioner of the art here. But I can assure the noble Lord that his suspicion (and this was not the substance of his speech at all) was unfounded.

The noble Lord, Lord Shinwell, suggested in his interesting observations that the Government decision to establish two bodies in this area had burst upon the world unexplained as a shock. I would draw his attention to paragraph 6 of the White Paper (which came out, if I remember correctly, early in January, two months ago) in which the Government's intention to establish two separate Agencies, the Price Commission and the Pay Board, was clearly set up. The noble Baroness, Lady Wootton, asked what were the positive reasons behind this decision. It is that to which I now wish to turn. It is our intention, provided that the Bill is enacted as it stands or more or less as it stands at the present time, to establish two Agencies, at least at the initial stage—and I stress "at least at the initial stage" and I will come back to that—not to avoid a combined agency which might be held to look remarkably like the old Prices and Incomes Board, to which the noble Lord, Lord Peddie, made so valuable a contribution; but to establish two Agencies which will be very different from, with very different functions from, those of the old Prices and Incomes Board.

Perhaps I might expand on this. Let me remind noble Lords of the functions of the Prices and Incomes Board. The noble Lord, Lord Peddie, needs no reminding. It was an advisory board dealing with a relatively small number of cases, some 30 to 35 a year, which were referred to it by Ministers. It had no power to claw back price increases. Its reports were advisory and covered cases in great depth. The new Agencies will be very different from the old Prices and Incomes Board. In the first place, they will have clearly executive functions. Then, unlike the Prices and Incomes Board, they will deal with a large number of cases notified to them directly by employers. They will have the power to restrict settlements and, above all, will need to reach quick decisions for they will be dealing with the cases referred to them within very strict time limits. Those are provided for, partly in the Bill and partly in the Consultative Document. The noble Lord, Lord Robbins, referred to the need for very quick power of decision on the part of both Agencies. It is true, and a glance at Schedule 1 demonstrates this, that the Agencies will have advisory functions and the Minister will be empowered under the Bill to ask for their advice on specific matters. My right honourable friend the Secretary of State for Employment has made it clear that he is proposing from the start to exercise this power in relation to paragraph 33 of the White Paper, to ask the Pay Board specifically to advise on the anomalies arising from the standstill. But in the main—and I should like to emphasise this—these two new Agencies will, in contradistinction to the Prices and Incomes Board, be executive in their functions, and in discharging their functions they will need to take clean, quick decisions. Apart from this, the two Agencies will have separate tasks requiring different expertise involving, in many cases, close and direct relationship with different sections of industry or commerce; and we believe it is vital for their success that they should, as soon as possible, generate confidence in their expertise, in their casework and in their acquired experience, in the firms and organisations with which they will be dealing. In our view this will be most easily achieved, at least at the start, if each Agency concentrates on its respective field.

In this I should like to pray in aid two facts. In the first place, there is the American experience which some noble Lords have been inclined to decry. But if we succeed in Stage 2 as well as the Americans appear to have succeeded in their Stage 2, I do not think that we shall be doing too badly. In any event, I would agree with those noble Lords who take the view that in this, as in other matters, there is no need for us to ape what happens across the Atlantic. But, that said, I would remind noble Lords that the United States policy of prices and incomes, which has not been—I put this moderately—totally unsuccessful, operates, at this stage of the policy on which we are now embarking, on a basis of two separate and independent agencies.

Secondly, although I know that the noble Lord, Lord Peddie, as he made clear in his admirable speech, is inclined towards a combined board, he was fair enough to recognise in our Second Reading debate last week that there would be a certain psychological barrier, as he put it, in having a separate Price Commission since this would serve to make plain to the trade unions that special attention was being paid to the question of prices. I would grant straightaway that in certain respects it would be absurd to try to consider the control of prices and wages in separate, watertight compartments. But it is not intended that the two Agencies should operate in complete and splendid isolation from one another; very much the reverse. As the noble Lord, Lord Wigg, suggested, it is proposed that they should share the same offices, and it is likely that also they will share certain common services and staff. This need for cooperation is particularly well illustrated in the proposals referred to in paragraph 138 of the Green Paper, the Consultative Document, for the establishment of a special construction panel including members of both the Price Commission and the Pay Board.

Again I would stress recognition of the need for close co-operation between the two Agencies and our lack of dogmatism in this matter. There is no dogmatism or ideology in our attitude here, as is shown by Clause 1(3) which allows for the amalgamation of the two Agencies into one body should this later prove to be desirable. This is clearly written into the Bill. Although it is difficult to see far into the future, we can certainly see circumstances, especially if it is possible for us all to revert to that voluntary path which most of us would prefer to take, where it might be desirable to combine these two Agencies into one body. That would be a time when they would not have the burden of urgent casework which they are bound to have from the start of Stage 2. This possibility is clearly provided for in the Bill.

That said, I would emphasise my agreement with something said by the noble Lord, Lord Peddie, on Second Reading—I apologise for quoting him all the time. I understood that the burden of some of his remarks was that, more important than any formal structure for these two Agencies—joint or separate as the case may be—provided for in the Bill was the way they would go about their work. I cordially agree with that sentiment. In contradistinction to something said at the outset of the discussion, I suggest that here we may have confidence, given the personalities and expertise of the two designated Chairmen, Sir Frank Figgures and Sir Arthur Cockfield, that these Agencies will not operate in an unduly restrictive and unimaginative manner; and that where there is an area of overlapping there will be a sensible and reasonable degree of co-ordination and co-operation between the two. What is more, with two separate Agencies which I hold to be desirable at least at the outset, there is no reason why there should not be that co-ordination because they will be operating under the provisions of the Code approved by Parliament; and that Code provides for a co-ordinated strategy. There is therefore no conflict.

Those, in sum, are the reasons. I apologise if I have spoken for too long on this Amendment. But I was "baited", politely and pleasantly, by a number of noble Lords for not rising earlier and making clear what the Government had in mind. In essence, those are the reasons why distinctly and definitely we prefer at the outset—I stress that—the approach by way of two Agencies. If the discussion goes on I may tip-toe back into it if need be, but those are the reasons why I cannot recommend the Committee to accept the Amendments in the names of the noble Lords, Lord Wigg and Lord Peddie. If I had to choose between the two I would prefer Lord Peddie's Amendment, save for one blemish in it which I will turn to in a second. He is not, as I see it, seeking to reconstitute the Prices and Incomes Board in its old form, as I take the noble Lord Wigg to be doing, but rather to accommodate it more to the thinking in the White Paper. But the blemish is in subsection (4) in which the appointments to the Commission would be subject to Statutory Instrument for the approval of Parliament.

There are Amendments on this point with which we shall be dealing, but I see grave objection, in principle and in practice, to departing from our time-honoured and traditional methods of making the Minister concerned responsible for the appointments to public boards, and subject to challenge in the traditional way. But my basic objection to both Amendments is that they challenge a basic and carefully considered policy decision by the Government to establish ab initio two Agencies, a decision which has been fully debated in another place. That decision was taken for reasons which I hope I have adequately demonstrated. It was challenged in another place, but that challenge was rejected. That being so, and because—to throw back something which has been said from the Benches opposite—I believe that the wording of the Bill as it stands at present, providing at the outset for the two separate Agencies, actually reflects the intention of the Government, I should hope that noble Lords, having listened to my explanation, will not seek to press this Amendment to a vote. If they do so, I hope that those noble Lords who have heard my explanation of the reasons behind the Government's decision will decide to vote against the Amendments, be they behind me or be they on the Cross-Benches.

LORD BESWICK

I do not think anyone would say that the noble Earl has spoken for too long, because he had a considerable case to answer. When my noble friend Lord Peddie made his speech on the White Paper, in which he dealt with the issue as to whether there should be one or two bodies, I thought that there were many on all sides of the House who were prepared to go a long way with him. He then followed that up with a speech in the Second Reading debate, and again now in speaking to this Amendment. I thought we were getting a very long way indeed. When the noble Viscount, Lord Amory, says that a proposal from this side is logical, then indeed we are beginning to make an impression; and my heart warmed when the noble Lord, Lord Robbins, said that he was at that stage disposed to accept what we were arguing. So there is a case. I agree with the noble Earl, Lord Jellicoe, when he says that there is here nothing between us as to ends. We are here considering means, and we are all wanting to make a success of a counter-inflationary policy. It is a question of means although the means themselves can be most important.

Let us look at the points that have been raised and see how the noble Earl has answered them. The first point raised is that there is an inter-relation between prices and pay (no one who has spoken has tried to controvert that): that it is quite impossible to consider the one in general without the other, and difficult to consider them in particular. I thought that the point made by the noble Baroness, Lady Seear—a new point in the disussions—was extremely relevant, and I should have thought quite compelling: that if one is considering pay against the background of prices, here we see that in the interests of the public we are more likely to get a proper balance and a proper protection of the public interest. On that point, as to whether there is any connection between the two, I think we are all agreed—and even the noble Earl, Lord Jellicoe, would have to agree with us on that.

Then the question arises as to whether the body as one body would be able to deal with these matters sufficiently quickly. This is an administrative point, and a lot will depend upon how the body is set up. But I should have thought that the conception that we had when we spoke of two divisions had precisely that kind of consideration in mind. Of course there are some cases where traders get on the telephone and want an answer almost straight away. You can get an answer even now from some of the Government Departments. If you take, for example, the D.T.I., what an enormous Department that is; it is far more extensive than this new proposed Commission or the two Agencies will be. Yet even there you can get on the telephone and get an answer sometimes. Certainly with the proper organisation you would be able to get quick decisions. The noble Earl said "keen, quick decisions". Well, even so, with the two divisions one could so arrange affairs that one could have administrative efficiency.

I would agree, however, with one point, made I think by the noble Lord, Lord Robbins; namely, that you will get different orders of magniture in some of the problems that will come up before this body. Some will be routine minor matters, and others will be large matters of principle: and the body, set up as one organisation, will deal with them in a different way. Decisions will be taken lower down in one case; they will be taken after proper consideration by the full Commission in the other. So again, although I accept that different kinds of matters will come up for decision, you will have a machine and administration which can cope with small and large references.

LORD ROBBINS

Perhaps I may interrupt, lest there be any misunderstanding, to say that I am not convinced by the arguments which the noble Earl has put forward that these two divisions could not function efficiently under one nomenclature. I may be persuaded during the rest of the debate, but at the moment the balance of my judgment is the other way.

LORD BESWICK

I am greatly encouraged by what the noble Lord, Lord Robbins, says. Just in case there are others who are not so convinced, maybe I can go on to the points as they appear to me. I was dealing with the second of the three points; namely, the question as to whether with one Commission the small matters can be dealt with expeditiously. I suggest that they can be.

The third point which the noble Earl advanced—I was surprised that he did not make more of it—was the fact that in the Bill there is provision for amalgamation later on. Here I suppose the issue is: do we start off as one, or do we amalgamate later after experience? I seriously suggest that it would be better if we start off in the way that we intend to go on. I can see that there are possibilities of personal frictions coming into this if the initial set-up by Act of Parliament is not likely to be a set-up that will evolve in a period of six months or a year. I thought that this was dealt with very well by my noble friend Lord Douglass of Cleveland. There will be a disposition to empire build; there will be certain individuals who will think it is better if the responsibility they have and the office that they hold, which pleases them, remains intact and is not subject to further amalgamation. I cannot see that the threat of amalgamation which is posed by the further subsection in Clause 1 is going to make for the happiest co-operation between the two bodies. If I was taking a contract with the Commission, I should want to know whether that contract was going to hold good or whether in six months time I was likely to be declared redundant because of a takeover or a merger. Takeovers and mergers that take place have a curious but understandable unsettling effect in industry, and I am sure that they would in this Department. So I suggest that, if we accept the fact that possibly later on there will need to be an amalgamation—and that is what the Bill provides at the present time—it would be better to make provision for this from the outset. Let us start as we intend to go on.

I will not speak about the composition of the Commission, because we shall have an opportunity later on to consider that. If the purpose of the White Paper was to invite constructive criticism; if the second document, the Green Paper, was, as it was said to be, a tentative document which was open to change; and if the purpose of having a Committee stage in Parliament on a Bill is constructive discussion with the possibility of Amendment, I should have thought that from the case made by my noble friends Lord Wigg and Lord Peddie and what has been said by the noble Lord, Lord Robbins—I suspect what they have said is also at the back of the mind of the noble Viscount—the noble Earl would do well to accept the principle of this Amendment. Of course, I know that the wording is not perfect, but the principle is clear enough. I should like to think that the Government are prepared to accept it.

BARONESS WOOTTON OF ABINGER

I am grateful to the noble Earl for having responded so gallantly to my challenge, though I find his argument rather more cosmetically alluring than convincing. I should like to add just a small postcript to the observations of my noble friends Lord Wigg and Lord Douglass on the economic aspects of this proposal. If the Press is to be believed, we are about to appoint two chairmen of two Boards. We are about to give one of them a salary rise of £5,000 a year and the other a salary rise of £5 a week, in order to keep other people's pay and profits down. It seems to me a rather paradoxical situation. If we had only one Board we could do with one chairman and one deputy chairman—and perhaps we could have the cheaper one.

4.22 p.m.

LORD RHODES

I do not think there is any doubt that the Government are indebted to the Americans for the pattern of their present suggested set-up; but it is interesting to hear from the noble Earl the Leader of the House that it has been successful. Those of us who have followed the American activities in this regard would agree that this is so, but I should like to draw attention to the fact that the Americans started off with a Cost of Living Council, and from that they set up a Pay Board, out of which came a Prices Commission. It may be that there is quite a large similarity between the American prices and incomes legislation and the Schedules to this Bill, particularly those concerned with enforcement. But I would draw the attention of the noble Earl the Leader of the House to the evaluation of the programme in America, in that the Pay Board there has been relatively successful in keeping wage increases to a 5.5 per cent. standard. That is according to an assessment made in November, and it is said that it will become more and more successful as time goes on. On the Prices Commission side, matters do not look quite so good. The Prices Commission has been less successful in reaching the upper limit of its 2.5 to 3 per cent. goal. Indeed, the wholesale price index went up by an annual rate of 7.2 per cent. this past November.

According to the evaluation, the main reason for the problems of the Prices Commission has been the limited scope of its mandate. I do not profess to know anything about that, and I am merely quoting an evaluation of first-class people concerned with the wool trade in this country—and if there is anybody concerned with this question of prices, it is those in the wool trade! That being so, I would ask the Government to look at the disparity of success between the records of the Pay Board and the Prices Commission in America. I have no particular bias about this problem. I am all for having the best—having one that will work—and it is time we all got together to make something work. This is a problem which has to exercise all our minds for a long time to come, and we may as well start off in the right way. If the Prices Commission has not had the same rate of success as the Pay Board in America and if we have taken their precedent to heart as we have, why have we not gone into the finer points of the relative success rate of each organisation?

LORD PEDDIE

We have had a most interesting debate, and I would apologise for prolonging it but, with the permission of the House I should like to reply to one or two points that have been raised and which have a bearing on this matter.

EARL JELLICOE

Perhaps I might make it clear to the noble Lord, Lord Peddie, that as we are in Committee the noble Lord does not need the permission of the House.

LORD PEDDIE

I like to feel the comfort of having your Lordships' permission, even if protocol does not demand it; so without the permission, I would make reply to one or two points. I think the most significant criticism of the proposals put by my noble friend Lord Wigg and other noble Lords concerns the possibility of delay. I think we should take cognisance of that, particularly in view of the fact that those who have expressed doubts have indicated considerable sympathy with the principle being put forward by my noble friends and I.

May I say in reply to the noble Earl the Leader of the House, that in point of fact there would be more delay if there were two separate bodies, because it has already been indicated (and restated by the noble Earl the Leader of the House) that there would be full coordination between the two bodies. If there is to be full co-ordination there would also need to be full and complete discussion. After a detailed inquiry either by the Pay Board or the Price Commission and the staff attendent upon those decisions, having made a decision each would need to go along to consult with the other partner, who is housed in the same building, in order to ensure that no conflicting decision was taken. I contend that that would make for far greater delay than having one body with two separate departments, or boards, to deal with these two different aspects.

There is also the fact that it would be impossible to have two separate staffs. Consider the kind of people one would need to employ—and I am speaking from experience, having directed the activities of many of these people. You need statisticians, cost accountants and others. The accountant would be equally at home dealing with the prices problem as he would with the pay problem. Indeed, it might be the same man who would be active in investigating one particular problem relating to two particular aspects—one pay and the other prices. Surely, under conditions like that, if you have the sort of set-up that we indicate, there would be greater speed, or at least less delay? I concede immediately the point made by the noble Lord opposite that speed is the essence of this problem. There must be the ability to work fast, just as we tried to do in the old P.I.B. You must work fast, otherwise time passes you by and the point is lost. Therefore in reply to that point I would say that, without any doubt, in my opinion there would be less delay, or greater speed, whichever way you care to look at it, in our proposals than in those at present suggested.

The noble Earl says that there is no dogmatism about the proposals; he even drew our attention to Clause 3 which indicates the possibility of a merger later. If that be so—and he reiterated all the indications that they are willing to coordinate, come together and so on—put it on paper. The noble Earl made a very useful point, and presumably advanced it in support of his arguments: there will be two bodies at the initial stages. Presumably there will be the merger later, and one must take heed of the comments made by my noble friend Lord Beswick. The noble Earl urged also that there would be different functions from the old P.I.B. I recognise the difference between the existing responsibilities and powers, and those possessed by the P.I.B. This, quite frankly, is an improvement—a considerable improvement potentially. There were far too many restrictions placed upon the old P.I.B.

But the point is that although there is a difference in terms of powers, there is no difference at all, nor could there be, in terms of operations. If you are making an inquiry into wages or prices, you use the same procedures and techniques to-day as you would have done during the time of the P.I.B.; so please do not try to persuade the Committee that there is a fundamental difference there. There is no difference at all. You have given different and, in some cases, greater powers, but you have not altered the techniques. You say that each will concentrate in their respective fields. I ask the noble Earl opposite this question: what does he mean? On the one hand he says that they must concentrate upon their respective fields, then he lays stress upon the fact that there must be greater co-ordination. Which is it?

EARL JELLICOE

May I answer that point straight away? There is no incompatibility here. It is my view, and the view of the Government, that it would be right to establish these two separate bodies at the start to enable them to conentrate in their own respective fields. But where co-ordination is required, it will be perfectly possible.

LORD PEDDIE

I recognise that. Everybody is entitled to his point of view. I have no desire to be obstructive; we have indicated quite clearly that one should give the maximum support to the general purpose of this Bill and to the bodies which are being set up. But the argument that has been advanced has no bearing upon the problem at all. I have no desire to say any more; I have no intention of wasting the time of the Committee. I will end by repeating the fact that our proposals will give all that is required by the noble Earl opposite: there will be greater speed in operation and an obvious indication of co-ordination, not a promise of it. Thirdly, the mechanics or machinery will be available in positve terms to apply the co-ordination. Therefore I say that the acceptance of these Amendments imposes no restriction at all upon the operation of the Bill, but clarifies the situation and makes it crystal clear to all concerned precisely what the intentions of the Government are. Therefore I hope that, at least in terms of my own personal experience, I have given the reply to the question (which was very well put) concerning the matter of delay.

VISCOUNT AMORY

I listened to the noble Lord very carefully. He said that the powers of the body we are considering now are greater than the powers of the old P.I.B. I understoood him to say that the functions were not that much different. But when we come to the price controls proposed, and the wide-scale monitoring involved, it amounts to a big difference in the functions. I thought that was the only point on which the noble Lord, if I may say so, overshot in his argument. I believe that point worries some of us, because the amount of detailed work and decisions which are going to come to the Prices Commission in the early days is going to be immense.

LORD PEDDIE

I should like to make it clear that in the old P.I.B. a great deal of monitoring was undertaken by the Department for which it and the Government received little credit. A great deal of work was done which was not necessarily within the P.I.B. There was a great deal of monitoring of prices. The greater powers lie in the possibility of more initiative on the part of the body that is being set up now. In terms of operation, in terms of making an inquiry, whether into prices or wages, the techniques or methods will be precisely the same with this new organisation as with the P.I.B. I hope I did not overshoot myself, I was merely saying that the way we tackle the job of inquiry, the people we employ to do it and the methods we engage upon, will be the same as they were two years or more ago.

4.35 p.m.

LORD ROBBINS

I feel great sympathy with what the noble Viscount, Lord Amory, has said. I do not think there is any fundamental difference between what he has in mind and what the noble Lord, Lord Peddie, has in mind. I confess that the noble Earl, in his observations, allayed some of the apprehensions which I expressed in my opening statement. He said there could be adequate co-ordination between the two Boards. If that is so, why, if the change of name has such a significant psychological penumbra as has been suggested by noble Lords on this side of the Committee, should the possibility of obtaining greater mutual confidence and understanding not be secured by what on his own showing would largely be a matter of nomenclature?

LORD HALE

I want to put two brief points without other comment. Whether we like this Bill or not, it is essential in the national interest that these Agencies succeed. I do not think anyone would doubt that. To do that, they must command two things: first, public confidence. It is perfectly obvious that the Pay Board may have a very easy run with the Press, except for some daily criticism from the Morning Star and from trade union papers, perhaps. The Price Commission will be subject to constant criticism, constant disapproval if they fail, from the Press, which may become rapidly hostile and, in that way, undermine the confidence which could be commanded by a joint Commission. Secondly, it is essential that this Commission should command authority. They may need authority to go to the Government; they may need authority to say, "We have tried to make this Act work but we cannot do so. We need amendments; we need new regulations, new statutory orders". They may say that they need more flexibility. They must have the power to do that if they are to command public confidence. They can do it infinitely better if they can present a collective view on the part of one Commission than if there are different points of view between the two.

THE EARL OF DUDLEY

I suppose it is in the nature of this Committee that this wide ranging and interesting debate should have focused on the technical effects of the Amendment in uniting the two Agencies rather than on the political considerations. I personally intend to support the Government, not because I am in the least impressed one way or the other by any of the arguments adduced so far. In fact, it seems to me to be a matter of six of one and half-a-dozen of the other as to whether you have, for technical purposes, one Agency or two. But, to my mind, one effect of these Amendments which seems to have been totally overlooked is that the political control of Parliament over the Agencies will be weakened because one result of having one Agency and one chairman will be that he will inevitably be involved in political judgments and priorities and political assessments; and it seems to me that, based on the old principle of "divide and rule", if these two Agencies are going to do their work and concentrate on the technical aspects of a prices and incomes policy it is very much belter for politics to be removed and for the chairman to be given the least possible reason for having to exercise political judgment. For this reason I intend to support the Government.

LORD DOUGLASS OF CLEVELAND

I will be extremely brief. It has been suggested by the noble Lord, Lord Robbins, and the noble Viscount, Lord Amory, that there is very little between us. What is between us is the timing, and in my experience timing is the most I important thing with which one has to deal. If you are not careful you will persuade the General Council that there is a reluctance on the part of the Government to consider prices along with wages. This is the most important thing that sticks out like a sore thumb in this debate. The Government might persuade the T.U.C. that they are reluctant to consider prices along with wages by the segregation of these two bodies. This is a fatality that could well be avoided by the acceptance of this Amendment.

LORD WIGG

I think the noble Earl was trying to drive a little wedge between myself and my noble friends when he said that he preferred my noble friends' Amendment to mine. I do not mind whether it is one or the other, because I share the view expressed by the noble Lord, Lord Douglass of Cleveland, that it will be tragic if the Government stand fast and do not accept the principle of our Amendment. I will make this offer. I will gladly withdraw my Amendment if the Minister will go away and consult with his colleagues and just spell out what they are missing. What are we seeking to do? The noble Lord, Lord Douglass, and myself—and I think I speak for my noble friends on this side of the Committee—want a policy that will work; we want a policy that is fair, and we want, if possible, for it to be on a voluntary basis. Of course that point is implicit in the first Amendment. The noble Earl really gave himself away. He told us that the Government's policy had been well thought out and then, almost in the next breath, he said, "Of course, these boards will be overwhelmed with work." That ought to have found expression in the Explanatory Memorandum. It was not this House that opted for £3 million and 700 additional bodies in the public service; it was the Government. But the noble Earl did not finish there. He told us how much he was influenced by what has happened in the United States of America. I am also influenced by what has happened in the United States. My noble friend was absolutely right: it succeeded on the pay side, but it stored up a bundle of trouble for itself on the prices side—so much so that the democratic unions which were supporting the Nixon régime withdrew after five months.

I hold the same view as that held by the noble Lord, Lord Douglass, and here he and I may be in complete isolation. One of the things that I want above all is to meet the convenience of the general public. Able unions, such as the Nurses' Union, of their very nature tend to get left behind in the struggle and I want this Board—and I tabled an Amendment with this in mind—to have the positive duty to keep the pay and conditions of work for people like the nurses under constant review. In return, if they are given that right—assuming that they opt for it; they have to ask for it—there will be a "cooling-off" period. I believe that a "cooling-off" period for the policemen, the firemen, the nurses, the teachers, the hospital workers and the like is an absolutely essential part of a stable economic and political society. But one cannot force this on people; one has to get them to talk and to understand and to feel.

The problem is this. We are the prisoners of our history, but when we come to deal with this as practical men with the problems we are not dealing with history: we are not dealing with yesterday; we are dealing with to-day and to-morrow. This is why I pleaded with the Government, and I plead with them again, to have second thoughts and not to reject this proposal. If there is one board because the subjects are put together (if I may use my rather vulgar expression, the heads and tails of the same penny, obverse and reverse) and if that section of the T.U.C. responsible to their members, in organisations which are essentially democratic and come into consultation with the Government and with the Confederation of British Industry, at the same time always have in mind the wider interests of the community at large, and they can sit round a table and have talks, they can talk about principles and not only details.

I was pleased that the noble Earl and I found ourselves in agreement on two points, and on the third one, if I may say so, he slightly misrepresented me. I am sure it was my fault; I expressed myself badly—that is due to the absence of a classical education. What I was trying to say was not that there were no meaningful talks—there were on details, but not on principles, and it is the question of principle that matters. The details we can leave to the civil servants. But on the question of principle there must be a voluntary organisation. If the Government have followed one policy of deflation until yesterday and they change their policy overnight, can we be surprised that people are suspicious and say: The devil was sick, the devil a monk he would be. We have changed our mind because we have got to. After all, they remember the noble Viscount, Lord Eccles—I do. It was he who turned round and said, "Treat 'em mean and make them keen". Oh yes he did. I have not forgotten. I also fought an Election on the basis of a Conservative Member of Parliament who said, "Britons won't work except on the basis of empty bellies". He was only a decade removed from them. I want, however, to forget those things because we are now dealing with the second half of the 20th century and not the first.

Now if I may turn to the noble Earl, Lord Dudley, he said, "Take the politics out of it". How do you take the politics out of it? If the actual Budget can throw on the Board executive power to have two targets instead of one that does not take the politics out of it. What take the politics out of it are men of good will sitting round the same table, pursuing the same objective, seeing each other's difficulties and determined to find a bridge. That is what we are trying to do on this side of the Committee to-day. We are seeking to be constructive. If the Government cannot agree—and I understand the noble Earl's difficulty—and he cannot agree to-day, will he be good enough to give the Committee an assurance that he will go away to his colleagues, reconsider, and come back on the Report stage and see whether it is possible to do as we have asked? If he will do that, I will withdraw my Amendment.

LORD SHINWELL

Now that my noble friend Lord Wigg has expressed his readiness to withdraw his Amendment in favour of the Amendment of what I may call the composite character which is before the Committee, it seems that there is hardly a quarter of an inch, or even less than that, between this side of the Committee and the Government side. Perhaps in order to fortify my contention I might read to your Lordships the two propositions, because it may be that in the welter of oratory and free flow rhetoric we have missed the bus and ought to come back to a proper route. The Government propose that there shall be established two Agencies, to be called respectively the Price Commission and the Pay Board. Later on there is an indication that they will have separate functions, but those functions will be correlated. In fact there will be co-ordination and co-ordination is unavoidable. That is the Government proposition. Now let us look at the proposition that my noble friends have submitted to the Committee. They suggest: There shall be established a Commission to be called the Prices and Incomes Commission and it shall operate in two Divisions, one dealing with Prices and the other with Incomes. What is the difference between the two propositions? Hardly anything at all; certainly not sufficient to divide the House; and certainly, in my humble opinion, hardly sufficient to prevent the noble Earl the Leader of the House from accepting a proposition that was made, I believe, by my noble friend Lord Douglass of Cleveland that the matter might receive further consideration. This would not be reversing the Government's decision because there is hardly anything to reverse where the only Amendment before the Committee is the one submitted by my noble friends instead of the one submitted by my noble friend Lord Wigg.

What is the difference, unless—I regret even harbouring a suspicion about the Government's intentions—there is some deep-seated reason which the Government have in mind, unless they want to make certain that when this matter is being considered they will be able, in the language of the noble Earl the Leader of the House, to operate in a somewhat arbitrary fashion in respect to wages? What he said—and I thought at the time that I might interject to have him clarify the point—was in effect that if an application is made to the Pay Board, if such a Board is in existence, then they will have executive powers. What do we understand by "executive powers"? One would have thought that this was a matter for the Government to decide, as already they have decided about the freeze, about the norm, and about the amount that can be paid by way of increase in various categories. But if they are to have executive powers, that surely means arbitrary powers. That is something quite new. I am far from objecting to arbitration. If I had taken part in the Second Reading debate I should have ventured to put my point of view about this matter because I think that sooner or later if we are to display any kind of common sense—and here I choose my words I deliberately because I do not want to fall foul of my trade union friends—we shall have to resort to something like arbitration. I know that objections have been raised to it, but it has operated in Australia and in New Zealand for a long time and on the whole with a great measure of success. But that is a digression.

I return to the point: what are the Government after? What do they want? If you have a separate body dealing with prices they have to deal with world prices, with applications made by housewives, by consumer organisations and the like, and involve themselves in a great mass of detail, only to discover that they have to come to a decision. Presumably if they are to have executive authority they can come to a decision only after consultation with the Pay Board. If applications for increases have been made, surely in those circumstances it would be a mistake to have these two bodies? Surely your Lordships' House must have been impressed by what my noble friend Lady Wootton of Abinger said? It had occurred to many of us. In thought it was not an original idea. We were all thinking about it when we read in the newspapers that two gentlemen were to be appointed, one to the Pay Board and the other to the Price Commission and they were to have substantial increases in their salaries at a time when the object was to try to prevent anybody getting an increase in salary beyond a certain norm decided by the Government.

Why do you want two Boards? After all, there will be a great deal of criticism on the part of the public if we have two Boards and the Price Commission are unable to do anything that is worth while. People will ask, "Why pay these people? Why not dismiss them?" In the circumstances, the Government might consider, in view of the miniscule, almost trivial point that is between us accepting the Amendment, probably the first time that they have been ready to accept any Amendment since I came to your Lordships Chamber—and that is quite a long time now. I have not noticed the Government accepting any Amendment, but here is an opportunity for a generous, radical, fine gesture which, by the way would satisfy the T.U.C.

That is my final point. It is worth while trying to satisfy the T.U.C. They may be difficult; they may be truculent, recalcitrant, intransigent, and all the rest. But try to get them on your side and in the long run it will be far better in the national interest. I am speaking as sincerely as it is possible in the circumstances. I mean by that that I am dismissing any suspicions about the Government's intentions. I suggest that the noble Earl the Leader of the House might take this matter away, come back at Report stage and satisfy almost every Member of your Lordships House (that is obvious because there are views on the Government side of the House which coincide with views on this side) and at the same time satisfy the T.U.C.

LORD DRUMALBYN

I wonder whether we are not getting rather far away from the purposes of the Bill itself. May I, with great temerity, draw your Lordships' attention to the Long Title of the Bill. This is what we approved on Second Reading. It is: An Act to establish a Price Commission and a Pay Board"— and let us say there are two possibilities here, a Price Commission and a Pay Board or a Prices and Pay Commission— to authorise the formulation of the principles to be applied by those bodies;"— or by that body— to afford powers of control over prices, pay, dividends and rents; to provide for the furnishing of information about rates; and for connected purposes. I rise to make just two brief points, because it has been said that the techniques to be applied by the two Agencies will be the same as the techniques applied by the National Board for Prices and Incomes. Of course I cannot for one instant vie with the knowledge and experience of the noble Lord, Lord Peddie, on this matter, but I venture to suggest that the techniques must be different and for this reason: that the National Board for Prices and Incomes was given remits to inquire into the particular circumstances of an industry or a group of workers, or whatever, within the general framework of industry and commerce in our society—in short, of our economy. It was completely unfettered in the way it went about its task, whereas here we have first to formulate, in the Code, the principles to be applied by those bodies. There is an entirely separate section for prices and an entirely separate section for pay. Those who are the Chairmen of these bodies, or the bodies themselves if you like, will be interpreting and applying the provisions of the Code. The question will be: "Does such and such an increase in pay, or such and such increase in price come within the limits of the principles that have been laid down, the four square limits of the Code?" This will be the question they have to answer. I would not have thought that in this respect, in the initial stage at any rate, that is in the phase we are about to enter, there would be more initiative for the two Agencies as we conceive them than there was for the National Board for Prices and Incomes.

The other point I want to make is that there is something to be said for having a Pay Board in a close relationship with the Secretary of State for Employment, because it is from him that the Orders governing their actions will emanate, and, on the other hand, for the Price Commission to be in the same relationship with the Department of Trade and Industry and the Ministry of Agriculture, Fisheries and Food. These should be the lines of communication, since the two Agencies will be working to a large extent on particular problems put up to them, one on the side of prices and the other on the side of pay. Of course, it is true that to some extent they will be interlocked; for example, in the matter of allowable costs, because labour is an allowable cost. When this arises in the case of prices it will be necessary to check on the labour content of the allowable costs. But there is no difficulty in passing information from one department of Government to another, and surely there will be even less difficulty in passing information from the Pay Board to the Price Commission within the same building.

Surely it is a recognition of these realities that for the next phase makes it desirable to have these two separate bodies. Whether they should be amalgamated when we come to the stage when the two bodies separately will be acting in much the same way as the National Board for Prices and Incomes is another question. There are various matters that will be referred to them—including the one to which my noble friend referred, the question of anomalies, which will obviously be passed to the Pay Board—which will be for consideration during the next phase. It is when we get to that phase that it may be appropriate to have one single body. But in regard to the mechanics of running the second phase, I submit to your Lordships that it is absolutely essential to have two separate Agencies.

LORD BESWICK

Could the noble Lord make it quite clear that what we are now talking about is an Act of Parliament which is going to have effect until September or October, and that when Phase 3 starts in November we are to have amalgamation and change the Act of Parliament?

LORD DRUMALBYN

Just as the Code can be changed by Order and so one can move from one phase to another, so also under subsection (3) of Clause 1 we do not need another Act of Parliament to amalgamate the Price Commission and the Pay Board. That can be done by Order in Council; there is no question of an additional Act of Parliament to do it.

5.4 p.m.

On Question, Whether the said Amendment (No. 1) shall be agreed to?

Their Lordships divided: Contents, 65; Not-Contents, 77.

CONTENTS
Amherst, E. Clwyd, L. Hurcomb, L.
Amulree, L. Cooper of Stockton Heath, L. Leatherland, L.
Archibald, L. Davies of Leek, L. Lee of Asheridge, B.
Ardwick, L. Douglass of Cleveland, L. Llewelyn-Davies of Hastoe, B.
Arwyn, L. Faringdon, L. Longford, E.
Beaumont of Whitley, L. Fiske, L. McLeavy, L.
Beswick. L. Gaitskell. B. Norwich, V.
Blyton, L. Garner, L. Nunburnholme, L.
Brockway, L. Garnsworthy, L. [Teller.] Ogmore, L.
Buckinghamshire, E. Gore-Booth. L. Peddie, L.
Burton of Coventry, B. Granville of Eye, L. Phillips, B. [Teller.]
Byers, L. Hale, L. Platt, L.
Champion, L. Henderson, L. Popplewell, L.
Chorley, L. Heycock, L. Rhodes, L.
Robbins, L. Slater, L. Taylor of Mansfield, L.
Royle, L. Snow, L. Wigg, L.
Sainsbury, L. Somers, L. Williamson, L.
St. Davids, V. Stamp, L. Winterbottom, L.
Seear, B. Stocks, B. Wootton of Abinger, B.
Segal, L. Stow Hill, L. Wright of Ashton under Lyne, L.
Shackleton, L. Summerskill, B.
Shinwell, L. Tanlaw, L. Wynne-Jones, L.
NOT-CONTENTS
Aberdare, L. Drumalbyn, L. Molson, L.
Ailsa, M. Dudley, E. Monck, V.
Amory, V. Eccles, V. Mowbray and Stourton, L.
Atholl, D. Emmet of Amberley, B. Murray of Newhaven, L.
Auckland, L. Ferrers, E. Napier and Ettrick, L.
Balfour of Inchrye, L. Furness, V. Northchurch, B.
Belstead, L. Glasgow, E. Nugent of Guildford, L.
Berkeley, B. Gowrie, E. Onslow, E.
Bledisloe, V. Greenway, L. Porritt, L.
Brock, L. Grenfell, L. Rankeillour, L.
Brooke of Cumnor, L. Grimston of Westbury. L. Redmayne, L.
Brooke of Ystradfellte, B. Hailsham of Saint Marylebone, L. (L. Chancellor.) Reigate, L.
Camoys, L. St. Aldwyn, E. [Teller.]
Cole, L. Hatherton, L. Sandford, L.
Colville of Culross, V. Hood, V. Selborne, E.
Conesford, L. Hylton-Foster, B. Strathclyde, L.
Cottesloe, L. Jellicoe, E. (L. Privy Seal.) Stuart of Findhorn, V.
Cowley, E. Kinnaird, L. Suffield, L.
Craigavon, V. Kinnoull, E. Swansea, L.
Craigmyle, L. Lauderdale, E. Teviot, L.
Croft, L. Limerick, E. Thomas, L.
Daventry, V. Lothian, M. Trefgarne, L.
de Clifford, L. Lucas of Chilworth, L. Tweedsmuir of Belhelvie, B.
Denham, L. [Teller.] Margadale, L. Vivian, L.
Derwent, L. Merrivale, L. Wolverton, L.
Devonshire, D. Milverton, L. Young, B.

On Question, Motion agreed to.

5.10 p.m.

LORD WIGG moved Amendment No. 3: Page 1, line 10, at end insert ("of whom not less than one-fifth shall be nominated by the Trades Union Congress, one-fifth by the Confederation of British Industry and two-fifths by representatives of recognised consumer organisations").

The noble Lord said: I beg to move Amendment No. 3. This Amendment is designed to give effect to what seems to me to be the position that has to be recognised if the Government's policy is to succeed. My Amendment is reasonably plain. It sets out that there shall be nominated one-fifth of the membership by the Trades Union Congress, one-fifth by the Confederation of British Industry, and two-fifths by representatives of recognised consumer organisations. If there be those who think I cannot add up and am one short, the other fifth would be nominated by the Government. This is not a mechanistic approach, but is in line with my general thinking. Despite what the noble Earl, Lord Dudley, may think I am interested in the politics of this. He wants to take the politics out, and I want to say to him quite bluntly that you cannot.

THE EARL OF DUDLEY

I do not expect politics to be taken out of the entire problem of prices and incomes; I am only suggesting that they should be taken out of the activities of the Price Commission and the Pay Board, and I feel that this is more likely to happen under dual agencies than one agency.

LORD WIGG

I do not want to rehash the arguments that have just been decided by a Vote, but you cannot take the Board out of politics. It is there, and the limelight will be on it. It may be that the Government may want to shift the limelight from 10 Downing Street, and certainly from the Secretary of State for Employment and from the more inept members of the Administration, and they will shift it on to the Board. I do not want to pursue the point again, but the limelight has been deliberately shifted by the Government on to a board of which, we have been told this afternoon, the emphasis is to be executive. If the Board is to be executive and to discharge executive functions, it is a political board.A political board should not contain the nominees of the Prime Minister's yachting friends, or his erstwhile friends in the Albany, or even from when he played the organ, or from Brown Shipley. This Board should be representative of the whole community, and the only way to guarantee that is to do it by Statute. While my Amendment does not name anybody, what I set out here, and what I hope the Government will accept, is that the composition of the Board will recognise the forces which are at work in our society, and make quite sure that there will not be an addition of power as between the T.U.C. and the Confederation of British Industry, because that way lies the corporate State.

I do not believe that the corporate State in Great Britain, if it comes, is going to come as a result of a "March on Rome", or even on Brighton; it will come about like a thief in the night, nobody noticing that it is there: but we shall wake up to find perhaps a harmony in the Orders because they have a common origin. I have already said this afternoon that democracy is a vigorous thing, and that politics is not something of which one should be ashamed—though I think that sometimes there are some on the Benches behind me who think they ought to be ashamed of politics. Politics is a virtue to be practised, not a vice to be hidden away. This is the lifeblood of a healthy community. One way in which it should function is for there to be a clear recognition of the powers the Board represent. I shall not detain your Lordships any longer; I simply move the words on the Marshalled List.

5.15 p.m.

LORD SHINWELL

Again I ask, can the Government give any indication of the kind of people they are going to appoint to these Agencies? Some strange appointments are made occasionally—not just since this Government came in; it has been customary during the period of office of previous Governments. I think that we should have some indication of what the Government have in mind. Do they intend to appoint any members of the T.U.C.? If so, they ought to say so. Do they intend to appoint any members of the Confederation of British Industry? If so, perhaps we might be enlightened. To leave this vague and to trust to the decision of the Secretary of State is hardly good enough. After all, the Secretary of State in this particular instance might be Mr. Davies. He has some strange ideas about the kind of person who should sit on Commissions, and so on. No doubt he would be inclined to a slight bias in favour of past Presidents of the C.B.I., or somebody associated with the banking corporations, or somebody in the City of London. We might find appointed a body that would in no way at all represent the general sense of opinion in the country.

I do not know whether the Government have any intention of indicating in a specific form who are to be appointed to represent the State on these Agencies. So far there has been no indication. If we are to judge from the appointment of the two chairmen—I am not quite sure whether it is two chairmen, or one chairman and some other person who is appointed for some reason or other—at huge salaries, we ought to be allowed to express an opinion about the matter. If I were told, as I may be before the end of the Committee proceedings, who these people are to be, and be given some indication of the salary they are to receive, I might be tempted to participate further in the debate. Meanwhile, the noble Earl, Lord Jellicoe, might tell us something about the kind of people the Government propose to appoint.

5.19 p.m.

EARL JELLICOE

The effect of the noble Lord's Amendment, as I read it, will be to place a drastic and severe limitation on the discretion of Ministers to choose members for the Agencies. As I understand it—and I think that my reading is correct, and the noble Lord, Lord Wigg, will correct me if it is not—if his Amendment were accepted, it would make it mandatory that four-fifths, 80 per cent., of the members of these Agencies would be drawn from the T.U.C, the C.B.I., and recognised consumer organisations. I hold in equally high regard the T.U.C. and C.B.I, and the recognised consumer organisations, whoever they may be, but it would be disingenuous of me—and I have no intention of being disengenuous—if I were not to make it pretty clear from the outset that the Amendment which the noble Lord, Lord Wigg, has moved, and moved in a very acceptable way, is one which is not acceptable to the Government. It is not acceptable because we hold that it is essential for Ministers to be able to appoint to these Agencies the people who, in their view, are best qualified to serve on the particular Agency required.

I know that we go in for nomination to bodies in certain areas of our national life. I personally believe that we rather overdo it. In some cases there may be justification for it, but I am sure that in many cases the worst way of establishing bodies which are capable of taking crisp, quick decisions—and these Agencies, as was made clear and I think recognised by everyone in our discussion on the previous three Amendments must be capable of taking quick, crisp decisions—is to have on them a large percentage of members who are nominated by, and therefore in a real sense set forward by other bodies to represent the interests of those bodies rather than the interests of the Agency or the Committee or the Board or whatever it may be concerned. If that principle holds true in general, I think it holds true in particular so far as these two Agencies are concerned. I hold it as really vital that organisations which will need to be committed to rapid executive action over a very wide area, which will have very considerable case work, should be in a position to avoid what I hope, without impoliteness, I may term the inhibiting hand of rival sectional interests, however important those interests may be. I recognise the very considerable importance of the three bodies, or the two bodies and the group of bodies which figure in the noble Lord's Amendment.

Thus I must make it clear that the Government are opposed to the importation of this principle of nomination so far as these two Agencies are concerned. But I must make it equally clear that the Government are in no wise opposed to wide consultation and deep consultation in this matter in helping the Ministers to put forward or to appoint the best possible people for these jobs. They have consulted appropriate interests about appointments. They have already consulted them through the two Agencies, and this process of active consultation is of course going on at the present time. It is also our intention that the experience and the expertise embodied in the Agencies and their membership should be drawn from as wide a range as pos- sible. I would suggest that if the noble Lord's Amendment were accepted it would lead to a disproportionate emphasis of the user interests in each Agency. Let me explain what I mean by that. One-fifth would represent trade unions, one-fifth C.B.I., and two-fifths consumer organisations. Only one-fifth would cover the whole range of other interests: for example, in retail organisations, and other voices, both professional and independent. I should have thought, for example, that there is a very good case for having an economist on each of these Agencies, and that would not necessarily be the case if the noble Lord's Amendment were accepted. The noble Lord's configuration would not even conform, as I understand it, to the so-called tripartite concept.

The noble Lord will be aware that the T.U.C. has chosen—and I very much regret this—not to offer suggestions for members for either the Price Commission or the Pay Board. I regret this and I, like other members of the Government, ardently hope that this attitude will change. Nevertheless, the Government have more than once said—and here I am replying to the question put to me by the noble Lord, Lord Shinwell—that they remain open to any suggestions from the T.U.C. Indeed, they have made it clear that they are prepared to take into account, as they are already doing, suggestions from many other interested parties. Those interested parties very much include those consumer interests and organisations of which the Amendment speaks. The Government have always recognised the importance of the consumer interest in the context of prices and incomes policy. It is indeed self-evident; and we have made this absolutely clear in all the talks which preceded this Bill, from Chequers onwards. Indeed, an illustration of this is to be found in Clause 2(4) of the Bill, which makes it necessary for the Treasury to consult representatives of consumers, among others, before making an order setting out the Pay and Prices Code. But there is a great deal of difference between consulting representatives of consumer interests and having nominations made or imposed on a Board by those representatives.

I should like to give a firm assurance to the noble Lord that in setting up these two Agencies and in deciding on their members, the consumer interests will certainly not be forgotten. I, for one, should not be entirely surprised—but I hope no noble Lord will read more into my words than should be read into them—if among the members, for example, of the Price Commission one finds a voracious feminine consumer; but I am not making any promises. I hope that I have said enough to persuade your Lordships, if the noble Lord, Lord Wigg, decides to press this Amendment, to oppose it. I am sure that the general argument which I have advanced, that taking 80 per cent. of the responsibility for deciding on the membership of these Agencies and vesting it in vested interests is quite inappropriate to these Agencies and to their membership.

There is another point. It is rather a technical one which may or may not have escaped the notice of the noble Lord, Lord Wigg, and this also is a real objection which I have to his Amendment. Noble Lords may have appreciated that if Lord Wigg's Amendment were accepted in the form in which it now stands, neither of the Agencies could be set up, given the fact that the T.U.C. have so far shown themselves unwilling to make suggestions for nominations—that is, unless there is a change of mind on the part of the T.U.C, as I hope there will be. But I think it would be unwise for us to count on it, certainly within the time-scale for setting up the Agencies which we have in mind, and which is clear, I think, to your Lordships.

Thus this Amendment I hold to be open to many objections in principle, above all the objection that it would take away the responsibility that membership should be left to the Ministers concerned who are of course subject to Parliamentary control. That is the objection in principle, but there is also a severe objection in practice, that if the Amendment were passed we should not be able to meet what I hold to be the general wish, certainly the wish expressed in your Lordships' House, that these Agencies should be brought into operation as soon as possible.

I hope that I have not been contentious in giving the Government's views on this. It certainly has not been my intention so to be, and I hope that the noble Lord, Lord Wigg, will see that there are very real objections both in principle and in practice to the Amendment which he has moved.

LORD WIGG

I can assure the noble Earl that he has not been in the least contentious. My Amendment has been more successful than I had hoped. First of all, the noble Earl has made it quite plain that the Amendment in the form in which I have moved it—that is to say, one-fifth, one-fifth, and one-fifth leaving a fifth to the Government—is unacceptable. I assure him that I had thought there would be difficulties about timing if it were accepted, but that, of course, I was quite prepared to leave to the Government.

The principle behind this Amendment is whether the Board shall be nominated by those forces which I think it is essential that the Government should take account of, and should bring into consultation at every stage, or whether the Government take the responsibility themselves. What the Government have done, and what I hoped they would do, is to say that the Board will be nominated by Ministers who will be answerable to Parliament. That I accept, because it will make it easy for me when I move my subsequent Amendments. I also congratulate the noble Earl on having dodged my minefield. I was lying in wait for him in another direction. He was very wise not to mention certain organisations. It is remarkable how Governments change when it is politically covenient, and I can remember a number of occasions when this Administration, and previous Conservative Administrations, have argued in exactly the opposite direction. I could give one or two examples, from my researches, but I do not want to weary your Lordships now. However, I can-gratulate the noble Earl on the fact that he has a whole body and has escaped that minefield. But far be it from me to say that he was contentious. His reply was wholly agreeable, and, with your Lordships' indulgence, I beg leave to withdraw the Amendment.

BARONESS PHILLIPS

The noble Earl is quite safe and no female will now accept nomination if she is to be described as "voracious".

EARL JELLICOE

Voracious, with my tongue in my cheek.

Amendment, by leave, withdrawn.

5.32 p.m.

LORD WIGG moved Amendment No. 4: Page 1, line 12, leave out from ("Food") to end of line 14 and insert ("whose names shall be contained in an order which shall not be made unless a draft of the order has been laid before Parliament and approved by resolution of each House of Parliament.")

The noble Lord said: I am quite sure that the Government will accept this Amendment, because it follows the logic of what the Minister said on the previous Amendment. The purpose of this Amendment is to add words which will make the Government answerable to Parliament for their decisions, and they will be required to put names …in an order which shall not be made unless a draft of the order has been laid before Parliament and approved by resolution of each House of Parliament.

I do not think I need argue the case, because it was made for me by the noble Earl the Leader of the House. He has argued that Ministers take decisions—and, of course, they do not act in a vacuum; they are answerable to the Houses of Parliament and, in most cases, an Affirmative Resolution of each House will be required. Perhaps because it will probably save time it will be convenient if I speak also to my later Amendment about the order's being subject to amendment. If there is any question of precedent, I shall be happy to supply the Committee with the precedents which have led me to the conclusion that I should put down Amendments which the Government will not only accept, but will accept without further argument from me. I beg to move.

EARL JELLICOE

The noble Lord, Lord Wigg, has almost disarmed me by the charm and brevity with which he has moved this Amendment. Having disarmed me, and having lost an arm in that way, I shall not be entirely surprised if I also lose a leg or a bit of a leg in the minefield which the noble Lord has suggested he has up his sleeve, if that is where he keeps his minefield for me. But, although disarmed, I must frankly confess to the noble Lord, Lord Wigg, that these two Amendments do not have an instantaneous appeal for me, and I shall explain why. The Bill provides that members of the Price Commission shall be appointed by the Secretary of State for Trade and Industry and the Minister of Agriculture, acting jointly, and the members of the Pay Board, in their turn, shall be appointed by the Secretary of State for Employment. These Board members have a leading part to play in carrying out our policies, as laid down in the Code and as approved by Parliament; and, in the Government's view, it is essential that the Ministers most directly concerned with the activities of a particular Agency should be able to select members for that Agency on the only basis which really counts—that is, their judgment—and Parliament can always challenge their suitability for a particular post. So far, I do not think there is much between me and the noble Lord, Lord Wigg.

As I mentioned on Second Reading, the chairmen of the two Agencies have already been provisionally designated in the persons of Sir Arthur Cockfield and Sir Frank Figgures. When I mentioned that fact on Second Reading, I heard no dissent from the proposition which I then advanced, that those two men were quite exceptionally well equipped to discharge the responsibilities—and they will not be light ones—which will fall upon them. It is the intention of my right honourable friends to make the subsequent appointments on the same basis of proven experience and the expertise and knowledge of the fields in which the Agencies will be operating. In my view, it would be quite wrong to make these appointments subject, as they would be subject if the Amendments of the noble Lord, Lord Wigg, were accepted, to prior Parliamentary approval. No doubt this is where the minefield lurks, because I am not aware of any significant and important precedent—I know that I am wading into the minefield here, and I should like to be enlightened when I have lost a leg —for our doing so, given the way in which we order things in this country.

If we were to make these appointments subject to prior Parliamentary approval, as the Amendments would require, why should we not be doing so in other contexts? If we were to make appointments to these Agencies subject to Parliamentary approval, why should we not make appointments to all the nationalised Boards subject to Parliamentary approval? Why should we not make the appointments of Ambassadors subject to Parliamentary approval? Why should we not go the whole hog and walk down the American path? But the Americans operate under a constitutional system which is entirely different from ours. We operate—and I hope this does not sound too professorial and didactic—under a system of ministerial responsibility, and I know of no good reason for departing in this instance from the way we have managed matters in the past. I would remind your Lordships that, when the last Government introduced the 1966 Prices and Incomes Act, they certainly did not make appointments to their Prices and Incomes Board subject to prior Parliamentary approval. What was right then —and, so far as I know, it received no challenge from the other side of your Lordships' House—is certainly right now, or I should like to know why it is not right. That is the basic constitutional objection, as I see it, to the requirement which would follow from the acceptance of this Amendment to make these appointments subject to prior Parliamentary approval.

There is also an important practical objection. It is not always easy to persuade people of the requisite quality and calibre to come forward and give their time to work of this kind—work which, however calmly we may discuss these matters in your Lordships' House, is already the subject of political controversy. It would, in our view, be wrong to add to the real practical problems of finding the right people by making it necessary for them to be further subject to scrutiny and debate by Members of both Houses; to have to run in advance the prior gauntlet of Parliamentary approval. It is far better to rely upon our traditional method; that is, the ability of Parliament to call the responsible Minister to account. If the Price Commission and the Pay Board perform badly, then Parliament will have every opportunity of expressing its views, and if the Ministers make bad appointments then those Ministers can readily be held to account. But I submit—I speak subject to correction—that to introduce what would be a very important new innovation in this field of appointments to major public bodies would be a very grave mistake both on grounds of principle and on the practical grounds which I have already advanced.

LORD THOMAS

I would be against this Amendment because in my judgment it would make the operation of the Bill more hidebound, less flexible, slower in action and slower in getting into action.

LORD WIGG

If the main objection is the fact that this breaks new ground, it is a new constitutional practice, that seems to me to be a very weak argument indeed, unless of course one thinks that the policy introduced by this Bill is of temporary duration. I think it has come to stay. The whole of my thinking is dictated by the philosophy worked out by Aneurin Bevan in 1952: that it would be the function of whatever Government are in power to hold the commanding heights of our economy and then to clear the ground so that the private sector and the public sector would work together. Though they would sometimes work in opposition, energies would be released in order to get our economy moving so that we could maintain our position in the world. The policy set out in this Bill is a new policy. The fact is that it is built on the embers of the previous Government's policies, which completely failed; and we have heard enough evidence to-day to know as a certainty that this policy has been introduced as a result of very little thinking. It is a hotchpotch introduced in the light of American experiences—experiences which have thrown up strains and stresses which may be peculiar to the United States, and many of which, perhaps, are not applicable here. I do not know; time will show.

But I should have thought—and I had hoped that the Minister and the Government would accept it—that, having set up these Boards, at every stage they should be answerable to the close scrutiny of Parliament. That is what the Bill itself seems to indicate, because if one turns to the First Schedule, what do we find? We find that they are each to render a report within two months. The poor chaps will have hardly got in. They will have drawn only one month's salary. They will have worked out the surtax on only one month's instalment before they are busily engaged in writing their first report, which the Minister is required to present to Parliament. Is this question of Parliamentary control and answerability to Parliament to be made real or not? What I am concerned about is the future of Parliamentary democracy, because I am one of those Socialists who believe in it ardently, and I do not want it any other way than as a result of a democratic debate. Are this House and the House of Commons to accept the view that we should sit helplessly by when the country is faced with continuing and increasing economic difficulties, and be utterly powerless to influence them, all we can do being to say, "Trust Ministers"? That is a very poor plea after the record of this Government because, if I may say so in all charity there is here a case for believing that they are not perhaps as able or as wisely chosen as they might be—and I am not now thinking only of the Secretary for Employment; there are others who are even better or worse, according to one's point of view. But I should have thought it was absolutely fundamental, if the Government really have convinced themselves that they need the co-operation of the trade unions—and I think they do—that they should accept the principle of Parliamentary control.

May I say that my thinking in this matter is not influenced only by my contact, indeed my arguments and discussions, with "Nye" Bevan. I well remember, when I was "Manny" Shinwell's P.P.S., coming up against a very able Permanent Secretary, Sir Donald Ferguson, who had been at the Treasury, perhaps in the days when Mr. Winston Churchill (as he then was) was Chancellor of the Exchequer. He talked to me about the return to the gold standard; and I remember having similar conversations with a man who had been Secretary of State for War and who had also been at the Treasury. I never could quite understand how anybody could be so foolish as to imagine that, after fighting a great war, one would be able to return to the gold standard, and that everything would be much as it was on August 3, 1914. I remember Sir Donald saying on many, many occasions, "What was wrong with our thinking is that we completely underestimated the latent power of the T.U.C."

Another story which is told by "Nye" Bevan in his book In Place of Fear is of how Bob Smiley and trade union colleagues of his were sent for by Lloyd George when the Triple Alliance had put forward their demands, which were much more extravagant (if I may use that word) and much more boldly proclaimed than anything that happens to-day. They wondered what was going to happen, but when they got there they were completely disarmed by the then Prime Minister, Mr. Lloyd George, who said, "We have got to give in. The Army is disaffected; we have no means of combatting you, either on the railways or in the mines. But I want to warn you. You are going to win, but when you have won you will then be responsible; you will be the Government." Bob Smiley said, "From that moment I knew we had lost", because in fact the T.U.C. were not capable then, nor are they capable now.

Of course that story has another significance. Those who talk about the T.U.C. wanting a confrontation and wanting to have a general strike to take over the powers of the Government are talking tommy rot, and for most of them here it is dishonest tommy rot, because they know very well there is no more law-abiding, patriotic body of men than the trade unions. But they are all so highly democratic organisations: they are answerable to their members. I know Mr. Jack Jones very well. He was an organiser in the West Midlands when I was Member of Parliament for Dudley. He is an able man, a modest man, a sincere man. But he is answerable in the last analysis, and he is extremely conscious of it. He has to do his best for his members. Therefore, if the Government want Mr. Jack Jones as an ally, they have got to create the conditions. They have got to have the wisdom to realise that they have to create the conditions in which Mr. Jones can ally himself with them. The same thing is true, I believe, right across the board. If the Government here claim the right, as indeed they can and as noble Lords assert they should, to say, "It is one of the prerogatives of the Government to govern; we are going to choose the members of the Board; they are going to be answerable to us", in the last resort Ministers are answerable to Parliament—not after the event, but before the event. Because the margin which separates this country from economic collapse or economic disaster may be no more than six months. If Mr. Barber's policy of a boom based upon consumer demand peters out towards the end of the year, if his productivity incline flattens out, we may be in serious trouble; and the allies that the Government want, the allies that are worth while, are allies which are to be found in the T.U.C. Therefore, the Government should not use either this House or the House of Commons merely as a means to buttress their policy. They should use it as part of the bridge which builds confidence.

I am not going to weary the Committee or detain your Lordships by pressing this Amendment to a Division. I suppose I should be the only person embarrassed if I did, because I may not get much support. But I am going to use this House for the purpose for which I came here. I suppose that, in the ultimate, the reason I came here was to get rid of it. It may be that I shall live long enough to achieve that end. But in the meantime, until I have got rid of it, I am going to use it. I am using it here to say what I believe to be the truth and also, so far as I can, to help the Government when the objectives they are pursuing are ones which I think worth while. The objects contained in this Bill in so far as the Government are concerned have my 100 per cent. support, but only in so far as the Government are genuinely concerned in pushing this policy through. Having said that, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

5.51 p.m.

BARONESS SEEAR had given Notice of her intention to move Amendment No. 6:

Page 1, line 14, at end insert— ( ) Not less than one in five of the members of each Agency shall be appointed with special responsibility for ensuring that decisions have regard to the public interest and if such members consider that any decision is contrary to the public interest they shall be required to make public their views and the reasons for them.

The noble Baroness said: The purpose of this Amendment is now somewhat negated in view of the speech that the noble Earl made with regard to the composition of the Boards. In drafting this Amendment, we assumed it was likely that a substantial part of the Boards would consist of persons clearly appointed, if not nominated, because they represented a very important special interest. It was with this in mind that we wished to stress the great importance of having people on the Board who looked at the question solely from the view of the public interest, who contributed to the discussions of the Board the facts as they affected the public interest, who were seen as watchdogs of the public interest and who, if they disagreed with the findings of the Board, would be charged to say so in public. The reason for this was the vital importance of having the public interest represented but also as a way of educating the public in what is necessary on these Boards, the facts to be taken into account, the true situation as it comes before the Board. As the noble Earl has assured us that the Boards will be composed of people chosen for their special knowledge, perhaps it is less necessary to emphasise this particular point than it was when we inaccurately thought the Boards would consist of special interest groups. Having said that, I shall not move the Amendment.

5.53 p.m.

LORD BESWICK moved Amendment No. 7: Leave out Clause 1 and insert the following new clause:

The Prices and Incomes Commission

"1.—(1) There shall be established a Commission to be called the Prices and Incomes Commission and it shall operate in two Divisions, one dealing with Prices and the other with Incomes. (2) The two Divisions shall be organised and operate in such a way as to ensure fullest co-ordination of their respective activities. (3) The Commission shall consist of not less than ten and not more than twenty-four members, appointed jointly by the Secretary of State and the Minister of Agriculture, Fisheries and Food. (4) The appointment to the Commission shall take into account the views and interests of recognised producers and consumer organisations and shall be made by an order contained in a statutory instrument subject to annulment by either House of Parliament.

The noble Lord said: We had a very full discussion on the principles behind this Amendment, and I am not proposing to press it unduly. I would call attention to the fact that the division of opinion represented in the Lobbies was extremely narrow, and I hope that what has been said behind the noble Earl, on the Cross-Benches, on the Liberal Benches and on our own Benches will be taken into account. I propose that we should return to this matter on Report stage, and I move the Amendment only for the purpose of enabling me to say that and to give my noble friend Lord Peddie the opportunity to reply to one point made by the noble Earl on the earlier debate. I beg to move.

LORD PEDDIE

As my noble friend has said, we had a very full discussion on the main points. I think we were exceedingly encouraged by the degree of support expressed by the Committee. I take the opportunity of commenting on the statement made by the noble Earl the Leader of the House in reply to some of the observations that I made. He said that he strongly preferred Amendment No. 7 to Amendment No. 1, which was under discussion at that time, with the proviso that he did not like subsection (4), which used the words: …shall be made by an order contained in a statutory instrument subject to annulment by either House of Parliament. There is a good reason for this. I think all noble Lords will agree that the success of the policy, no matter how it is technically operated, will depend on the degree of support and involvement. Frankly, here we create circumstances which would make for even greater involvement on the part of Parliament itself. We could see nothing but virtue in that. We may be returning to this point and therefore I endorse the view expressed by my noble friend that there is no point—

EARL JELLICOE

I recognise that the noble Lord will be withdrawing his Amendment and that possibly, as Lord Beswick suggested, we should return to this matter at Report stage. I have no quarrel with that; but I should not like the noble Lord to have misunderstood what I said about his Amendment which I readily acknowledge has a symmetrical beauty which I am the first to admit to. I think he may have misunderstood me. I said that I objected to both Amendment No. 7 and the Amendment standing in the name of the noble Lord, Lord Wigg, but that if I had to choose between the two, I would say that his Amendment was the less objectionable, save for this particularly objectionable subsection (4) which I did not like.

I have listened to what has been said and I should like to reflect on his explanation of subsection (4). The noble Lord was not in his place when I was replying to a rather similar Amendment moved by the noble Lord, Lord Wigg, though it provided for the Affirmative rather than the Negative Resolution procedure which is written into subsection (4). If he will look at what I said then, I will reflect on what he said a moment ago. I thought I should explain that my objections to his Amendment were fairly fundamental and why I was not able to go along with the suggestion sympathetically advanced from the noble Lords opposite that we should have a second look at this.

LORD BESWICK

I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 1 agreed to.

Clause 2 [Code for guidance of Agencies]:

5.57 p.m.

LORD CHAMPION moved Amendment No. 8:

Page 2, line 25, at end insert— ("The code shall set out the general principles which shall guide the Commission including the principle of the planned deployment of the increase in the G.N.P. on the fairest possible basis.")

The noble Lord said: In my opinion this is an Amendment with great significance. At the moment it is technically at fault because the word "Commission" does not now apply because as Amendment No. 7 was not carried the words do not now appear in the Bill. To make the Amendment technically correct the word "Commission" would need to be replaced by the word "Agencies". But that does not alter the arguments which I hope to adduce in favour of the Amendment that stands in my name and that of my noble friends.

What this Amendment seeks to do is to take the consideration of the Agencies far beyond limiting the extent to which prices may be increased on account of increased costs, or to secure reductions as a result of reduced costs or wages, which would have to take their consideration into the realms of sharing out the increase of the national product fairly over the whole field. For that reason, it is a very wide and far-reaching Amendment and I sincerely hope that it will receive from the Government the consideration it deserves.

The Government have gone a long way towards creating a totally planned and managed economy. If this were not the case we should not to-day be considering this Bill or the accompanying Code. There is no need for me to rehearse the steps which led the Government to the point they have now reached. Clyde shipbuilding and Rolls-Royce concerned two very significant steps they had to take under the pressure of events which moved them from the stance that they took up at the outset of their period of government. I do not blame the Government for their change of policy since 1970. They have been driven by experience step by step to abandon their own policy and to adopt policies which, however much they dislike them, they know to be inevitable.

I am firmly of opinion that the force of events must lead the Government to greater and not less intervention in the economy of the nation. If the Agencies are to go outside the narrow interpretation of their powers under the Code, which implies the consideration of matters which come before them price by price, or in strictly limited fields or in the case of pay, industry by industry, clearly the instructions to the Agencies must be widened beyond the terms of the Price and Pay Code now before us in draft. It is in draft because we are considering this Bill in Committee and the Code cannot be separated from the Bill. The Pay Board, for example, looking at an application for a wage increase in Stage 3, will not be able to confine its thinking to the actual increase being sought. It will have to consider the effect on the industry and, perhaps even more important, the possible effect of a wage increase on all the other industries and services in the country.

For an example, look at the gas dispute to-day. It will be seen that the decisions taken some time ago in relation to the electricity industry are rankling in the minds of the gas workers, because the bringing of the freeze into operation prevented the gas workers from getting an increase comparable with that granted in the electricity industry. This is saying that the Pay Board ought to have before it the consequences of adjusting the differentials in the industry itself, and the likely repercussions on other industries. Additionally, it will have to consider how the fruit of increased productivity is to be allocated between prices, the remuneration of capital and wages. It dare not leave out of consideration any one of these parts of the division which must take place. There is no simple answer to this, but it will make nonsense of the prices and pay policy if that is not done by these Agencies, and particularly by the Pay Board.

In addition, together with the Price Commission, the Pay Board will, to a large extent be in a position to allocate the gross national product over the whole field of incomes. It will have to decide whether wages shall take a greater or a lesser share of the gross national product. It is asserted by those who have studied the matter that as a result of the Government's Stage 3 policy there will be a reduction of the share of the national product going to wages. Perhaps that is not intended, but that that is the case is asserted by those who have studied it. This assertion is based on the argument that if wages increase by 8 per cent. in 1973 and inflation by 6 per cent., it would mean a growth in real wages of 2 per cent. compared with the growth of the gross national product in real terms of 5 per cent. Relatively, therefore, the position of the wage-earner will have worsened. To some extent what I am talking about is the problem that has faced everyone who has had put before him any problem in connection with an industry and the wages paid in it.

Some time ago we had the Wilberforce Court of Inquiry into the dispute between the National Coal Board and the National Union of Mineworkers. That court recognised the danger of considering an industry in isolation. I do not know whether noble Lords remember what the Inquiry Report said under the heading, "Wider considerations". It said this: We have seen it as our duty to examine the circumstances in the coal industry over as wide an area as possible. We think it necessary to travel beyond a mere consideration of percentage increases of rates of pay or earnings and to look at the wage structure in the coal industry, its history and development, the economics of the industry, the conditions in which men work and the causes so far as we can understand them, of underlying unrest among the miners. Of course the coal industry cannot be looked at in isolation.

That is very much the point I am making. The Report continues: Although there are factors bearing upon its size and prosperity which are beyond its control—and also beyond our powers to recommend policy—we have to think of the industry as it exists in today's climate. Specifically we cannot shut our eyes to the continuing danger of inflation, which presents the most serious threat to the standards of living of everyone, including the miners themselves. We bear firmly in mind the national interest, which requires the survival of a viable coal industry in competitive conditions, with a contented and efficient labour force. We have tried impartially, independently and urgently to bring these considerations into balance.

Any future Pay Board or Commission will have to try to bring the decisions at which it arrives into balance when considering the whole of the national economy. I believe that that will be absolutely essential if their work is to have its proper relevance to the whole of the rest of the economy. What the Wilberforce Court of Inquiry said is what this is all about, for it highlights the vastness of the problem facing the Agencies, and the impossibility of separating individual price or wage considerations from the wider conception of the whole economy. What we are proposing for the Agencies is a mammoth task, but to attempt to consider price and pay in a narrower context would be doomed to failure. What we seek by this Amendment is to add to the words of the opening part of Section 2 of the Prices and Pay Code which states: The Code will have a dual function. First, the Price Commission and Pay Board are required to exercise their powers so as to ensure that it is implemented. Secondly, it should be taken into account by all those concerned with the determination of prices and pay. To that we seek to add these words: And the agencies shall take into account the division of the increase of the gross national product between incomes, prices and the proper remuneration of capital. All three of these things must be taken into consideration, and I think that we ought to give the price and pay Agencies these instructions by the addition of those words, putting them first in the Bill and subsequently in the Code.

LORD CAMOYS

I do not entirely agree with the noble Lord, Lord Wigg, but I do say to your Lordships that on this Board and on the Commission we should appoint a trade union leader. I feel strongly that that would strengthen our actions.

LORD PEDDIE

The whole of Clause 2 is concerned with practical guidance to the Pay Board and the Price Commission. In short, they will be concerned with the nuts and bolts of the operation. This Amendment, which I hope the Government will see their way to accept, goes a little further, and justifiably so, in my view, in the sense that it offers better guidance to the Board—guidance concerned with the philosophy of their operations, their ultimate purpose, rather than the immediate techniques as to how they should set about it. In other words, they will be concerned with the strategy as well as the tactics. Again, this is an Amendment which expresses no limitation upon the activities of die Board: indeed, on the contrary, it offers an enormous amount of additional opportunity. It offers opportunity for the Board to have a much clearer idea of what it is all about. Therefore I cannot see any justification for turning down the Amendment. All the members of either body would, I am sure, be pleased to have better guidance as to what is the ultimate strategy. Certainly guidance on how to undertake the day-to-day operations is important, but it is equally important to have some idea as to what the ultimate objectives are. That is what this Amendment seeks to give.

THE EARL OF ONSLOW

One or two salient points strike me. First of all, this Amendment seems to me very woolly, in that the instructions are so broad and wide-ranging that, to all intents and purposes, it is meaningless. The next point perhaps slightly contradicts what I have said. All Governments must take into account all the points that are raised in this Amendment. Thirdly, die noble Lord who moved this Amendment was worrying about the difference of a 2 per cent. rise in real wages and a 5 per cent. growth, but surely what we are all most concerned with is that a lot of this growth should go to investment, which in its turn will raise die real standards of our people far higher than actual money earnings.

6.12 p.m.

BARONESS WOOTTON OF ABINGER

I think that this Amendment is potentially one of the most important on the Marshalled List, although I am not at all sure whether it will or will not accomplish what I understand to be its objective. As they stand, the general principles in the Pay Code (and I refer only to the Pay Code, not to the prices section) are extremely narrow. I think they are also mutually contradictory, but I will come to that in a moment. They are very narrow, because virtually they say that the function of the Pay Board is to fix the limit of pay increases so as to keep within the gross national product, which seems to me to be both right and proper. Then, having fixed the limit, under the fourth of the general principles they are to leave it to the parties concerned to decide how they should distribute such increase as is available. In that sense, there is very little room for manœuvre.

This is where I find the contradiction, because under paragraph (ii) of the general principles the Board has to apply the limit fairly, having already handed over the job to somebody else; and in paragraph (iii), "fairness" is, for once, almost defined by saying that there should be an improvement in the relative position of the lower paid. It seems to me that if the Pay Board is to be an effective body it must have much wider powers and much more room to manœuvre. We are all glibly talking about "fairness": "fairness" is referred to in the general principles and the Amendment of my noble friend Lord Beswick, and it is probable that we all mean different things by "fairness", though there is a wide measure of agreement about one element of "fairness" being an increase in the relative position of the lower paid. I hope that as time goes on, as a result of this Amendment, the Pay Board will be given much wider terms of reference than those extremely narrow principles and will be given an opportunity to implement defined criteria of "fairness".

The definition of those criteria is, I am sure, a political question; that is to say, it will be a matter for discussion by the Government of the day whether they consider that the structure of incomes should be roughly what it is now, or whether it should be less unequal. Broad questions of principles of that kind ought to be politically determined. Then, much more specific instructions should be given to the Pay Board as to the conception of "fairness", and more power to implement it, not leaving it, as paragraph (iv) suggests, to those who normally fight the battles about distribution of income.

I had hoped that the Pay Board would be something which would look much more widely at the whole question of the distribution of pay and would take into account not only the interests of the people who pay out the remuneration and those who receive it but also what was referred to in an earlier Amendment that was withdrawn as "the public interest". I therefore hope that this Amendment will be taken in the spirit in which I am sure it is intended, as extending the powers of the Pay Board to a much wider conception of what is meant by "fairness". I would add here that we have seen quite recently the striking gas workers exhorted by the Government to take their problems to the Pay Board even before the Pay Board was born. It seems to me that this was rather a hollow promise, because the Pay Board has little opportunity to manœuvre on questions of substance. As the principle stands, it will have power to manœeuvre only within a limit which is already very properly determined.

LORD BESWICK

I hope that the noble Earl, Lord Jellicoe, will be forthcoming on this Amendment. As my noble friend Lady Wootton of Abinger has said, the spirit behind the Amendment is entirely helpful, and indeed, we are here going further in some respects than the Government themselves. I have paid a tribute before now to what my noble friend Lord George-Brown did with his Declaration of Intent. I thought that that achievement was a considerable step forward in our affairs, and the tragedy is that we were never allowed to develop it. Mainly because of the policy of the Treasury at that time, the idea of controlling became a negative thing. We were preventing wage increases or, where there were wage increases, they were governed by a flat-rate norm. The imaginative, hopeful aspect of that Declaration of Intent was entirely lost in practice. But now we are faced in some respects with a different situation.

I agree with the noble Lord, Lord Robbins, that the Chancellor of the Exchequer is being entirely reckless in his money supply; but I would also accept that, in so far as we are not making a god of the balance of payments and are making it possible to expand our economy, then within that expanding economy it is possible to have a constructive expanding incomes policy, and the idea of this constructive expanding incomes policy ought to be in this Bill. The noble Lord, Lord Drumalbyn, I believe, arguing against a previous Amendment, said that there was all the difference in the world between the Prices and Incomes Board of which my noble friend Lord Peddie was the Chairman and the Commission which is envisaged by this Bill. He said it was "a different animal", because that one was concerned with executive powers, and this was concerned with the formulation of principle. But there is not a word in this Bill about principle, and the principle set out in the Code itself is just about as inspiring as a road sign or a railway timetable. There is nothing that can be called a basic philosophy or basic principle there, and there ought to be something which would permeate the deliberations of the Commission—something which would give some hope for the future and something against which one could judge future actions.

It is impossible to say that the Bill is not dealing with general principles, because the noble Lord himself has said that this is so. It is impossible to say that it does not provide for a Code: it does. What we are saying here is that in the Bill some indication should be given as to the motivation principle and philosophy. Our own words may not be entirely appropriate. We did not have a great deal of time to discuss the Bill together. The Bill has been rushed through, and of course we do not have the resources that the Government have so far as help with drafting is concerned. But there is a clear principle here, as my noble friends have said, and I hope very much that the noble Lord will be able to say that, if not these actual words, something along these lines will be acceptable to the Government.

6.23 p.m.

EARL JELLICOE

The noble Lord, Lord Champion, said that here in a minor respect we were labouring under a disadvantage, and clearly, in view of the vote taken not long ago on a previous Amendment, it is one which quite clearly was open to a technical objection. That is a minor disadvantage and one which I do not propose to labour. There is also the disadvantage—or advantage, as the case may be—that inevitably in considering this particular Amendment we are looking over our shoulders, as it were, at the Green Paper, the Consultative Document. But again I can see some advantages in that as well. As I understand this Amendment—and I certainly do not wish to deal unsympathetically with it—it would oblige the Treasury to include in the Code a statement of the general principles which should guide the Agencies in applying the Code. That is the first leg of the Amendment: the general principle. The second leg, and the particular leg on which I think noble Lords have leaned hardest, would oblige the Treasury to set out in the Code the principle that the country's increasing prosperity, which of course we all desire, should be shared fairly between the different sections of the community.

All this seems fair enough, and I found myself in very considerable agreement with a great deal of what was being said. But I have doubts (and they are not light doubts) about whether it would be right to import an obligation of this kind into the Bill. In the first place, I would reiterate what has already been mentioned, that this Consultative Document already starts with a statement of general principles. Paragraph 7 refers to the general principles on the prices front while paragraph 75, which some noble Lords have been inclined to criticise, refers to the general principles relating to pay. They of course include a number of general principles which bear directly on this matter of fairness.

The very first principle on the pay side, paragraph 75, is to limit the rate of increase in pay in money terms to a level more in line with the growth of the national output, and of course it is designed to limit further inflation. We all know that in the last resort nothing is less fair, particularly to those who are less able either to fend for themselves or to fight for themselves, than inflation. The second principle specifically states that the limit is to be applied fairly; and the third principle is intended to facilitate improving the relative position of the lower paid: that is also aimed at fairness.

The noble Baroness, Lady Wootton, was inclined to suggest that the four principles, or some of them, set out in paragraph 75 are mutually incompatible. Read in isolation, one against one, this may be so, but I do not think it is the case if they are read together.

BARONESS WOOTTON OF ABINGER

I wonder whether the noble Earl would be good enough to allow me to clarify that point? It appears that principle No. (ii) and principle No. (iv) are in direct contradiction. Principle No. (ii) says that the Board must apply the limit fairly, and principle No. (iv) says that the Board must not do anything about determining how the money within the limit is to be shared. These principles seem to me to be in direct contradiction.

EARL JELLICOE

I note the point made by the noble Baroness and suggest that perhaps we might come back to this at Report stage. Meanwhile, I should like to agree with her that the draft Code—or perhaps I should say the draft of the draft Code—which is now before us in the Consultative Document relates only to Stage 2. If the noble Baroness therefore stigmatises the Code on the pay front as being restrictive and of allowing little room for manoeuvre, that is because it is related to the comparatively short period of Stage 2, where admittedly there is only a limited possibility of manoeuvre, although that amount is indeed increased by paragraph 75(iv).

BARONESS WOOTTON OF ABINGER

If the noble Earl will forgive me, the Bill itself is not confined to Stage 2, and that is why we want these words in the Bill.

EARL JELLICOE

While that is quite true, the Consultative Document from which the noble Baroness was quoting is confined to Stage 2, and I was following her argument. What I was saying was directly relevant to what she had said.

LORD BESWICK

IS the noble Earl saying that when we come to page 3 in another document we may not have anything in it about principles at all, and that if we do have something in it about principles it will just be out of the generosity or the quixotic character of the Government, and not because the Government have a statutory requirement to put anything in the Code?

EARL JELLICOE

No. As far as I understand, at present there is no statutory requirement to import general principles into the Code. I recognise that noble Lords would like to import such a statutory requirement. I would claim, though, that the fact that general principles are already written into the Consultative Document surely goes some way to meeting the spirit which lies behind this particular Amendment. Nevertheless, I am inclined to question whether it would be right to lay a statutory obligation on the writers of the Code necessarily to include in it a statement of general principles. This would obscure its real purpose, as I understand that purpose, which is not to set out general principles, but rather to set out as fairly and concisely as possible the detailed rules for putting into action whatever the policy may be.

I am quite prepared to consider carefully what has been said about the necessity for incorporating general principles, as it were, as a statutory obligation through the Bill into the Code. There are technical objections which I will not go over now because that never sounds convincing. If these technical objections are confirmed, I will come back and expand on them. That is the first leg of the Amendment—whether there should be this statutory obligation to incorporate general principles; and without the statutory obligation they are already there.

The second leg is the particular principle which includes the principle of a planned deployment of the increase in G.N.P. I suggest that in any event this is a matter more for Stage 3 than Stage 2. Stage 2 will be comparatively short; it will end in the autumn. It is not therefore likely to last more than six months or so. Its aim, as we all know, is to bring down the rate of inflation to a more acceptable level, laying the foundations for longer-term policies of real economic growth. We know that Stage 2 has been designed to favour the lower paid in a broad brush way, just as announced improvements in social security benefits are designed to help the old and handicapped. But we know, too, that the standstill and Stage 2 represent an element of rough justice. Undoubtedly—and I am the first to acknowledge this—there are groups containing many hundreds of thousands of skilled, talented and devoted workers who feel that they have been badly done by in the standstill and in Stage 2 which is going to follow it. I do not question that some of those people feel this with justice. That is why we have paragraph 33 in the White Paper; that is why it is the Government's clear intention to see that the detailed studies of the so-called anomalies and relativities should be remitted to the Pay Board, who will be required to make their Report by September at the latest. Their recommendations will be taken into account by all concerned. We hope to get the advice of the trade unions here in formulating the policies for Stage 3. But specifically to import into the Bill the principle of the planned deployment of the increase in the G.N.P. on the fairest possible basis at this stage could be held to imply that we are asking the Pay Board to consider in Stage 2 what in our view should be properly considered in relation to Stage 3.

I would go further. My noble friend Lord Onslow said he thought this part of the Amendment was rather woolly; in any event, it was drawn very wide indeed in his view. I agree with him. Taken literally, the acceptance of this leg of the Amendment would lay upon the Agencies a very wide responsibility indeed for apportioning or making recommendations about the apportionment of our national prosperity. Taken literally—and a glance at the Amendment shows that this is borne out—it would make the Agencies responsible for sharing out, or recommending the sharing out, on a far wider basis than even the noble Lords who have been advocating this Amendment suggest. The apportionment of increases in the G.N.P. on the fairest possible basis could include a value judgment as to the proportion of the increase which the working and the non-working population should receive. This could imply that the Pay Board would in some way be responsible for determining the allocation as between those in employment and those under the age of employment, or between those in employment and those over the age of employment; it could even be held to imply a value judgment, for example, on the correct apportionment between social security and national security. I therefore suggest that whatever noble Lords feel about the first leg of their Amendment, and however much we may sympathise with what they have said about the second leg of the Amendment, it is drawn far wider than they would really recommend.

But at this stage of our consideration of this Amendment I should like to say that I recognise the sincerity with which noble Lords opposite have spoken. They have not spoken in any way desiring to undermine either the Bill, or the Pay Code, or the general policies which we are wishing to pursue. I am quite certain that the second leg of the Amendment is defective. Acceptance of the first leg of the Amendment would be open to very real technical objections. But, totally without commitment—and I should like to underline this—I am quite prepared to look at the arguments they have advanced between now and the Report stage to see whether there is anything I could do to meet their viewpoint, whether by way of Amendment which I could accept—which I very much doubt indeed —or whether by an expression of view which would be read into the Record, which might also be acceptable. I doubt whether I am going to be able to do so, and it would be stupid of me to pretend that I am going to be able to do so. When one says that this is without commitment, in this case it is doubly or trebly without commitment. That is what I should like to say in reply to this Amendment and, not least, for the way it has been moved.

6.39 p.m.

LORD CHAMPION

I am grateful for what the noble Earl has said, and for his honesty in saying it. He has told us that he is prepared to consider the matter further but without commitment. I take that to be absolutely the case; having used those words myself from that Box, I know what they mean. But we have on record the noble Earl's reply to the debate. We shall be able to study this, and during the period between now and the Report stage (unfortunately it will not be very long if we are to consider this Bill again on Thursday next) we shall have some time in which it consider whether we need to put down a further Amendment adjusted to meet some of the points which the noble Earl has made.

I admit that I must have been a little woolly about the whole thing myself if I am to understand that the things I have been talking about, and we have been talking about, apply only to Stage 2. As I understand it, this Bill applies to the whole of the stages from here onwards. So if we include words of this sort in the Bill they will apply not merely to the Code prepared for Stage 2, but also to a Code prepared for Stage 3. I cannot imagine that if any Code is given to the Agencies as to how they are to behave and conduct their work we shall not have a Code for Stage 3. I imagine that the Department are already considering this Code in connection with the difficulties which clearly they are going to have to face when we get to what I regard as the most difficult stage of this counter-inflation policy: namely, Stage 3. What will happen up to the end of Stage 2 appears to me comparatively easy. With Stage 3 the real problems will begin to mount up. We ought to ensure that somewhere in the Bill there is a statement of principle, and this principle is a principle which we sought to embody in our Amendment, which I admitted at the very outset was technically faulty. I believe there are other considerations—? and the noble Earl has pointed them out —which make an amendment to our Amendment necessary before the next stage.

The noble Earl, Lord Onslow, said, in reply to something that I had said about wages, that much of the product of growth, much of the increase in the gross national product should go to investment Actually I believe he said that all of it should. I certainly should not accept that. What I said in moving this Amendment was that a part of: the increase in the gross national product should go to the remuneration of capital; part should go to wages; part should go to a decrease in prices. The remuneration of capital, as I understand it, is not merely a matter of dividends; it is rather a matter of the replacement of existing capital and the growth of capital for investment in our future. That is how I understand it. I believe that is an acceptable way of looking at what should accrue to us as a result of an increase in productivity. I have never said that this should be a matter where the whole increase should go to wages. I have never for one moment suggested that that should be the case. I shall not say more now. I will carefully consider what the noble Earl, Lord Jellicoe, has said, and in the meantime I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

6.42 p.m.

LORD WIGG moved Amendment No. 9: Page 2, line 36, leave out ("as they think appropriate") and insert ("whose names shall be contained in an order which shall not be made unless a draft of the order has been laid before Parliament and approved by resolution of each House of Parliament.")

The noble Lord said: When I opened the Bill and read this clause I thought I had got hold of the wrong document. I should be grateful if the Government could explain the circumstances in which a Bill is drafted containing the words "the Treasury shall prepare a code". Why not the Secretary of State? When I then turned to the interpretation clause at the end of the Bill, thinking I should find an explanation of what was meant by "Treasury", I found that there was no such explanation there. I noticed that when the noble Earl was replying he did not refer to the "Treasury"; he spoke about the writers of the document being responsible. So exactly who is responsible—the writers of the document, the Treasury, the Minister? What are they required to do? It says that they "shall prepare a code for the purposes of this Act". Very good. They get down and they prepare it—and then what should happen? The Bill says: …it shall be the duty of the Agencies to have regard to that code…".

What does "to have regard to" mean in legislative form? They could throw it in the wastepaper basket, they could read it upside down, they need not read it at all. But who is going to challenge that they did not have regard to it? To put it mildly, this seems to be loosely drawn.

Normally speaking, I have made it a rule, since I served my political apprenticeship under my noble friend Lord Shinwell, never to ask a question in the House of Commons (and I have tried to repeat it in your Lordships' House) unless I know the answer. But on this occasion I am breaking a life-time's rule. I do not know the answer to this and I am asking the Minister whether he will be kind enough to tell me whether there is any other example, either on the Statute Book or in a Bill in the course of its passage through either House that the Government hope to get on the Statute Book, which contains similar words addressed to the Treasury, requiring them to carry out an action under the authority of a particular piece of legislation. What is to happen after that, presumably, is that somebody is to send somebody else a Christmas card saying, "Thank you very much, I have had regard to it". Before making the order the Treasury is required to consult certain representatives. Again, what are they to do? This time they are not required to "have regard to it"; they really have a savage duty imposed upon them in that they are required to do such things as they think appropriate. It seems to me that when my noble friends described this as "woolly" they were being unduly complimentary. It is nonsensical in legislative form.

I have tried to depart from that precedent and at least to say what I want to happen. I want to take out the words "as they think appropriate". Whoever is meant by "the Treasury"—perhaps it is the doorkeeper at the Treasury, or it may be the building itself, or an echo, but no doubt the Minister will tell us—he should be required to consult with persons whose names shall be contained in an Order which shall not be made unless a draft of the Order is laid before Parliament and approved by a Resolution of each House of Parliament. At least that is specific. If the Treasury is to consult they must come to both Houses of Parliament and say with whom they are consulting and what they are consulting about, to give noble Lords in this House and the Members of the House of Commons an opportunity of saying: "You should not consult about that; you should consult about this". At least they ought to know what is going on. I will give way to those Members of your Lordships' House who share my curiosity as to what this particular clause is intended to convey. I beg to move.

LORD SHINWELL

I have always been intensely interested in semantics and for that reason, if for no other, I should like to ask the Minister who is in charge —I am not quite sure which particular Minister is in charge at the moment, but I presume it may be the noble Lord, Lord Drumalbyn—what is "an appropriate person"? I think we should be given some explanation of that. I am not quite clear what the Government have in mind when they refer to "an appropriate person" and I think this point should be made abundantly clear before we accept this Part of the Bill.

If one reads this clause one is even more surprised, because—it is extremely important that I should have the attention of the Minister at this moment. I am sorry if I have interrupted an interesting conversation. It is probably an official discussion, but I shall proceed now that the noble Lord is quite composed. As I read this clause, it is even more surprising. What subsection (4) says is this: Before making an order under this section the Treasury shall consult such representatives of consumers, persons experienced in the supply of goods or services, employers and employees…". What other categories are likely to be brought in? After all, we have the interests of the consumers, the representatives of those experienced in the supply of goods or services; wholesalers, retailers and the like, manufacturers, and so on, and then we have the representatives who come within the definition of "employers and employees". Who are the others? These are all "appropriate persons". Presumably the representatives of the consumers are appropriate; presumably the representatives of those experienced in the sale of goods, the manufacture and distribution of goods, and so on are all appropriate persons. Employers and employees are also appropriate persons, but who are the other appropriate persons? Is it intended to bring in university professors, educationists, psychologists, and psychiatrists? After all, if we are going to accept the Bill it ought to be specific. We ought to be able to understand it, and what is more important is that the public should understand it. Who can tell but that there may be litigation about the Bill in the future? I can imagine some person on the bench in the High Court, the county court or an ordinary magistrates' court who inquires as to what is meant by "an appropriate person". Perhaps the noble Lord, Lord Drumalbyn, would clarify this important point in semantics for me.

LORD RHODES

As we proceed it becomes more and more obvious that the pay Code has been very loosely thrown together. I should like to quote the noble Lord, Lord Drumalbyn, when he was winding up last week. He said: It is important to recognise that the Green Paper is a Consultative Document and, naturally, in formulating proposals for the later draft Code, the Government will take into account comments in the House as well as by interested parties outside. The White Paper setting out the draft Code"— that is the later draft Code, I am presuming— will itself be debated, and even when the final version is incorporated in the Statutory Instrument any further significant changes will themselves be debated in draft by Parliament." —[OFFICIAL REPORT, 5/3/73, col. 968.] I am reading verbatim what the noble Lord said. After going through all that paraphernalia and time consumed in both Houses, we come to what it says in the Bill. Who is the master in this house? Is it the Treasury? Can the Treasury upset the ruling by the Price Commission or the Pay Board, or what? Presumably after long debate a code will be produced but it can be upset almost at once by the Treasury. That is the question I should like to ask.

LORD BESWICK

When the noble Lord comes to reply, I hope that he will relate his answer to what he said a little earlier about the line of communication between the Commissions and the Secretary of State, the Department of Trade and Industry and the Minister of Agriculture. He told us that one other Amendment was not practical; they wanted the two bodies because one would deal with the Secretary of State and the other with the Minister of Agriculture. Here we find that the matters with which they will be dealing are drawn up by the Treasury. I share the anxieties expressed by the noble Lord, Lord Wigg. When we see the controlling position of the Treasury here one is almost inclined to think the game is up; we are back in the Dark Ages again; we have the Treasury riding over everything. I look forward to hearing what the noble Lord, Lord Drumalbyn, has to say about the incursion of the Treasury. But after that, again my interest is aroused by this "appropriate person" and like my noble friend Lord Shinwell I should like to know what is "an appropriate person". Are consumers not appropriate? Are employers not appropriate? Are employees not appropriate? And if they are, what is this other category of people?

LORD DRUMALBYN

I think the House is rather excelling itself on these Amendments at the moment. We start off with an Amendment to a subsection of Clause 2 which deals with the way in which persons, representatives, and so on, should be chosen, because the noble Lord is asking that their names shall be contained in an order which shall not be made unless a draft of the order has been laid before Parliament and approved by resolution of each House of Parliament. That is what we are dealing with on this Amendment. The noble Lord in effect then says, who is the Treasury? I am aware that the Treasury exists. I think he is too, from long experience. There can be no doubt that there is an entity called "the Treasury". I am told that this is common form in many Acts of Parliament. The noble Lord then asks why should the Treasury be doing this job at all? That is not exactly what his Amendment is about, but the Treasury is a good co-ordinating Department, surely, where we are dealing with a wide number of subjects.

LORD WIGG

I am sure that I share the knowledge, with the noble Lord, that there is an institution called "the Treasury", and we probably both know where their offices are. But is that the point? Why in this particular case when we have had established the words through the mouth of the noble Earl of the acceptance of responsibility by the Government, indeed it is emphasised, should we find the Minister sliding off to this nebulous organisation, even although somebody in the Box has told the Minister that it is common form? We want it by Statute. The Government cannot have it both ways. If they are saying that we as Ministers must exercise the power and this is the function of a Government that we should exercise that power, do not slide off in the next clause when it suits and hide behind an institution called "the Treasury". Does the noble Lord understand that those of us of humble origin do not mind being called by Shaw "the undeserving poor", but we hate being called "an appropriate person"?

LORD DRUMALBYN

The noble Lord may think that it is inappropriate that the Treasury should do this. I am expressing the opinion that they are the ideal Department to do it. It is not as if there were not Ministers responsible for the Treasury in Parliament. Of course there are. It does not mean that this is a totally irresponsible body that is being left to do this job.

LORD WIGG

Why does it not say so?

LORD DRUMALBYN

I have told the noble Lord that in this kind of sphere I am advised that this is common form. I shall make further inquiries into this with great pleasure and I shall be glad to tell the noble Lord the outcome.

The noble Lord, Lord Beswick, reverted to what I was saying earlier on the subject of the Pay Board and the Price Commission. This is not in any way incompatible with what I was saying before. The body that is going to coordinate the Code is the Treasury. It is given the duty of preparing the Code. It is given the duty of consulting. Then one has to ask, whom is it going to consult? One might have said, "Just such persons as it thinks appropriate". But in order to give what is known as the ejusdem generic rule to give the kind of persons to be consulted, it is said: such representatives of consumers, persons experienced in the supply of goods or services, employers and employees". Those are the kind of person who are going to be consulted. That is quite reasonable. These, surely, are the sort of people whom they ought to consult. But it is not intended that they should be limited in that way. They might even consult, for example, the self-employed, professional people of that sort.

LORD WIGG

The noble Lord cannot have read the clause. It does not say: Before making an order the Treasury shall consult for example such representatives… It says: shall consult such representatives…and other persons as they think appropriate. They are going to consult those in any event, but, in addition, "other appropriate persons".

LORD DRUMALBYN

I was just trying to make the point that as I read this—and I think the noble Lord will agree with the grammar—they …shall consult such representatives of consumers, persons experienced in the supply of goods or services, employers and employees… and such other persons as they may think appropriate. That is not to confine it to those four categories of people. The noble Lord now comes along and asks us to say that their names shall be contained in an Order …which shall not be made unless a draft of the order has been laid before Parliament and approved by resolution of each House of Parliament. My noble friend the Lord Privy Seal has already dealt with the case of appointments to the Agencies. If it is not normal to appoint to Agencies, how much less normal is it to designate in an order the names of people you are going to consult? I have never heard of that being done before, and I cannot see why it should be done in this case. I do not think the Committee should accept this Amendment.

7 p.m.

LORD SHINWELL

I do not think that is good enough. I am not raising any objection to the appointment of representative persons, employers, employees, those who represent trade and industry and consumers' organisations. I accept that obviously that is the right thing to do. What I asked, and I repeat, is will the noble Lord explain to me what is an "appropriate" person? For example, am I an appropriate person? The answer, of course, would be completely in the negative so far as noble Lords opposite are concerned. Is an appropriate person someone with a clean bill of health? Is an appropriate person somebody who has failed to serve a term of imprisonment? Is an appropriate person somebody who, if I may use language often used in your Lordships' House, has been rehabilitated? I think we ought to know. Is it some friend of somebody in the Treasury? Why cannot the noble Lord tell us what is meant by an "appropriate" person? That is all I am asking. I do not object to the others being appointed. I do not care whom the Government appoint so long as I know what is meant by the Bill. I want to understand the Bill. Surely that is a reasonable request.

VISCOUNT AMORY

I really think noble Lords are making heavy weather of this matter. I do not think ordinary people would find these words at all inappropriate, or find any difficulty in deciding who would be an appropriate person. The noble Lord seems to be asking that we should put in the Bill a list of those who are inappropriate; I do not think that that would be feasible either. I think we are making heavy weather about this. The point that seems a little unusual to me, from my recollection, is using the word "Treasury" instead of the more normal practice of mentioning a Secretary of State or Minister, but I do not want that in any way to cause your Lordships to think that I am associating myself with that slight note of denigration of that noble institution which I occasionally think I can detect in noble Lords' speeches. Somebody asked what the definition of the Treasury is. As a former incumbent, I think no better definition than the words of Archbishop Cranmer's Creed: Archangels, angels, prophets, saints and martyrs, and all the company of Heaven".

LORD SHINWELL

It is not right to suggest that I or any other Member of your Lordships' House is making heavy weather of something which appears in the Bill; it is the draftsmen who are making heavy weather of it. If the noble Viscount suggests that instead of the word "appropriate" the term should be "inappropriate", then I begin to understand it. If he thought accordingly, he should have put down an Amendment to that effect. What do we mean by this—somebody inappropriate or somebody appropriate? If it is somebody appropriate, I think we are entitled to know what that means—an accurate definition.

LORD DRUMALBYN

I take it that what the noble Lord is really saying is that the Treasury should put down in the order, as the noble Lord, Lord Wigg, is suggesting, the names of those people they think appropriate, so that we should know. I am saying that this would be a totally inappropriate thing to do. The short answer to the noble Lord must be that when you consult, when you seek advice, you seek advice from people you think can be of advantage to you in giving advice, people from whom you will get real help. That is why it is left to the Treasury to consult with those people they think appropriate. They are given guidance as to representatives of consumers, employers and so on, and then finally "and other persons". This covers all kinds of other persons, including, for example, people who have retired and who might be able to give very good advice. I hope that the noble Lord, Lord Wigg, will now agree to withdraw this Amendment, because it seems to me to be not one which would commend itself to the Committee, both on account of its extremely unusual character and because of the reasons I have given and the normal function of consultation.

LORD BESWICK

Would the noble Lord just answer the question put by his noble friend Lord Amory, why this anonymity about the Treasury? In the earlier clause we referred to the Secretary of State or the Minister of Agriculture specifically. Are we referring to the Chancellor of the Exchequer or not? If it is some sort of anonymous body lower down, it adds to the general blur of doubt we have about the clause as a whole.

LORD DRUMALBYN

I have given the answer, that in this kind of circumstance this is the usual thing to do. I have undertaken to look at it further, and it seems to me we can leave it at that at the present time. We all know what the phrase means; we all know what is intended. Surely we can leave it at that.

THE EARL OF ONSLOW

Does not the word "appropriate" mean useful in this context? If you define the people as only those who are experienced in the supply of goods or services et cetera, it counts out all other people who might have a useful contribution to make to a policy which seems to me—and I have listened with great care—to recommend itself to all sides. I cannot see why the word "appropriate", or "useful" should be deleted.

LORD WIGG

I am sorry the noble Earl cannot see what we are driving at. I am not responsible for his obtuseness. I wish I were, but at a much younger age when I might have done something about it. May I come back to the noble Lord, Lord Drumalbyn? He keeps putting his foot in it. It would be much better if he became a Trappist and shut up. He said that you only consult people you think will be of use to you. I quite accept that; but, unlike the noble Lord, I am a respecter of the rule of law, not only verbally but right the way through all my political actions. The noble Lord may know what is meant; it may be that everybody on the noble Lord's side knows what is meant; but when you write a Statute it is going on to the Statute Book and it has to be interpreted at a subsequent date.

The noble Lord has given an assurance that he is going to take it back and look at it, and I gather that if he finds it should be put in another way he will come back to the House and put it right. I gladly accept that. I only want to ask one thing more. He did not say anything about my point that the Board is required only to "have regard to". If this is common form, and if this constitutes, as it were, in the terms of the noble Viscount, the wisdom of "the archangels, angels and all the company of Heaven", it is tough luck on the Heavenly Host that when it arrives the Agency is only going to "have regard to it". Therefore, I am quite willing, as a testimony to the affection in which I hold the noble Lord, to withdraw this Amendment, on the basis of the firm assurance he has given that he will make inquiries and, if he finds that there is something in the point, that he will come back to the House. On that basis, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

LORD DRUMALBYN

I think it would be an appropriate time to adjourn the Committee stage and to take the Education (Work Experience) Bill. I beg to move that the House do now resume.

House resumed.