INDUSTRY BILL

HL Deb 06 August 1975 vol 363 cc1697-749

Report stage resumed.

Clause 22 [Extension of powers to give selective financial assistance under Industry Act 1972]:

4.25 p.m.

Lord ELTON moved Amendment No. 63: Page 18, line 26, leave out paragraph (a).

The noble Lord said: My Lords, your Lordships may recall that at the Report stage I said that a fuller statement was needed on the Government apologia for the evisceration of Sections 7 and 8 of the Industry Act 1972. I tabled a series of Amendments which would give occasion for this explanation and also an opportunity for the Committee to express our views thereupon and an opportunity for Her Majesty's Government to say why these Amendments should not be pressed. I gave notice privately earlier today in the interests of dispatch—which I think your Lordships will agree should be pursued—that I would group these Amendments together and I propose now to speak to Amendment Nos. 63, 64, 66, 67, 68 and 70. Interleaved with these Amendments are others designed to ameliorate the functioning of the Bill if these Amendments prove not to your Lordships' taste. I will deal with those in another manner later.

The group to which I am now speaking refers to that part of the Bill which applies to Sections 7 and 8 of the Industry Act 1972. The distinction between these two sections in the 1972 Act is that Section 7 deals exclusively with assisted areas and Section 8 with all areas generally. The effect of the clause we are now considering in toto, Clause 22, is to remove the limits set on the action of the Secretary of State, not as they are set out in the Bill but as they are set out under another piece of legislation. The character of that piece of legislation is fundamentally altered thereby. There were, in fact, five different kinds of safeguards and limits placed on the activities of the Secretary of State. The first of these is as follows: formerly, in the 1972 Act as it stands, the Secretary of State could acquire loan or share capital only if that is the only way in which he could assist the company. If it is not the only way, he cannot do it.

As amended by this Bill, he can acquire that loan and share capital whether or not appropriate alternatives exist which may or may not be preferable. It may help your Lordships if I say that in the assisted areas this point is covered by Section 7(4) of the Act and Amendment 63 on the Marshalled List and in the general section it is covered by 8(1)(c) and 8(3) and the Amendments in that case are Nos. 66 and 67. The effect of the Bill as it stands will be that the giving of selected financial assistance in this manner will no longer be a matter of last resort, and it can be used in preference to grants, loans and even vesting orders.

The second group of Amendments, Nos. 64 and 68, relate to Sections 7(5) and 8(4) of the 1972 Act. As that Act now stands, the Minister is required to dispose of the loan or share capital that he has acquired as soon as appears to him reasonably practical. Under the Act as this Bill seeks to amend it, he will be able to retain them in perpetuity. This opens up the whole of British industry to consumption by the Secretary of State and converts the Act, as it were, from something in the nature of a sanatorium for sick industry into something in the nature of a shark. One enters a sanatorium in order to be cured one enters a shark in order to be digested.

The third safeguard was that the Secretary of State under the Act as it now stands can run the scheme only until the end of 1977, though honouring contracts later. I refer to Section 8(5) of the Act and to Amendment No. 70. This relates to the general area only, it is not limited to the assisted areas. It means that the Secretary of State is in charge of a machine that can run forever for as long as the funds hold out. We should like to be told why this limit has been removed. The only limit now remaining is that of the availability of cash.

Finally, in the Act as it now stands in Section 8(3)(b) the Secretary of State cannot acquire more than half by nominal value of the share capital of a company unless it is in an assisted area. He can now acquire all of it. This acquisition must be, it is admitted by consent with the company; but the choice placed before the company is the stark one of allowing itself to be taken over in part or in toto, or lose control, permanently as against temporarily. Taken together these Amendments mean the Secretary of State can buy membership or control of any company in any part of the United Kingdom and retain it for as long as he wishes, and retain it into a period of profitability. This is relevant to the point which I raised that the only limitation now is that of the existence of sufficient funds. The Secretary of State can run an empire which will be self-regenerating, and he will be able to go on purchasing his way into British industry for as long as he wishes, all of this outside the Bill we are discussing but inside the Industry Act 1972.

At the Committee stage of that Act, in another place, the right honourable Member for Bristol. South-East, Mr. Wedgwood Benn, said: We believe that the arbitrary nature of the Bill is likely to strain relations between Government and industry given the massive range of powers which the Secretary of State has and the large sums involved. If Members of your Lordships' House on the other side agreed with that then, what can they think of the Act as it will be when we have finished ripping out the safeguards which even then they regarded as inadequate? Those are the questions that I should like noble Lords opposite to answer in a group in order that we may decide what to do with these Amendments.

4.33 p.m.

Lord LOVELL-DAVIS

My Lords, we are prepared to answer these Amendments in a group. If I may, I will talk to Amendments Nos. 63, 67, 64 and 68, and my noble friend Lord Melchett will speak to Amendments Nos. 66 and 70. There has been no concealment of the Government's intentions to make the changes to which these two paragraphs give effect. The basic principle underlying our proposed repeal of the restrictions in Sections 7(4) and 8(3) was set out in the Labour Party Manifesto of October 1974, which said: Whenever we give direct aid to a company out of public funds we shall reserve the right to take a proportionate share of the ownership of the company". While the term "appropriately" assigns the Secretary of State discretion, these parts of Section 7(4) and Section 8(3) of the Industry Act 1972 arbitrarily accord assistance in the form of share participation a lower priority than other forms of assistance. This limitation is therefore being repealed in order to honour our Manifesto commitments.

The original Bill tabled by the previous Administration made no reference to the provisions that we propose to delete. The introduction of the present wording of this part of Section 7(4) and Section 8(3) of the 1972 Act was specifically introduced by amendment to limit the Government's freedom to provide assistance in the form of loan or share capital. Its effect is to give priority to forms of assistance other than equity participation, and it is for this reason that we are proposing its deletion, and in effect a return to the 1972 Bill as originally tabled.

Quite simply, we believe it wrong that when the Government is offering assistance to a company, it should be denied the opportunity of taking a share in that company unless this is the sole, or the sole appropriate, means of providing the assistance. If we provide assistance under Section 7 or 8, we believe we have a right to take a share in the equity of the company so assisted, and that this right should not be subordinated as these subsections of the 1972 Act make them subordinate.

In the case of the disposal of shares or stocks, under the terms of the 1972 Act the Secretary of State must dispose of shares or stock as soon as it seems to him reasonably practicable to do so, and that, before so disposing of them, he may consult the company. The Government believe that when assistance takes the form of shares or loan capital, the Government should be able to retain their stake and earn a proper return on it. I was glad to note in our debate at Committee stage that the noble Earl, Lord Onslow, accepted this principle. I note the noble Earl is not in his place at the moment. It is a principle which seems to me to be in conflict with this Amendment.

There should therefore be no restriction of the sort imposed by Sections 7(5) and 8(4) of the 1972 Act to require Government to sell the shares they have acquired in this way. We believe it proper that Government should be free to enjoy the benefits of share ownership, and not be confined in the way that has previously occurred. That deals with our answer to Amendments Nos. 63, 67, 64 and 68. I will leave it to my noble friend Lord Melchett to deal with Amendments Nos. 66 and 70.

The Earl of BALFOUR

My Lords, these Amendments are highly technical because, among other things, we are amending the provisions of another Act which is always difficult to follow. What gives me considerable concern are some of the words in the 1972 Act that are being repealed at the moment. Let me take selective financial assistance in Section 8 of the 1972 Act and just give you an example of some of the words which are being taken out: The Secretary of State, in giving financial assistance…shall not acquire more than half, by nominal value, of the equity share capital of any company. These words are being deleted. I can see the Government's idea that where they give financial assistance, they feel they should have a share of the stock capital; they are dealing with public money. This I accept, but if the Bill as it is now drafted stands, then they can, in giving financial assistance, with the Secretary of State's approval of course, acquire 51 per cent. of the holding.

This is not the provision that I feel will encourage investment in British industry. Furthermore, unfortunately, once a director of a company knows that the Government are holding 51 per cent. of the shares, he will perhaps not be so keen to look after the overall financial interests of the company in the same way as he might have done where the Government held only 30 per cent. This is unfortunately just one of the facts of life. Furthermore, I feel very strongly that the Government, having used public money, invested it in Company A, and helped it to get back on its feet, they should then be in a position to sell their shares in that company—I would hope at a considerable profit—and perhaps put the money into some other company that is not perhaps quite so healthy. There is a limit to capital, even if it is Government money, and among the words being repealed are these: Where financial assistance is given by acquiring shares or stock in a company the Secretary of State shall dispose of the shares or stock as soon as, in his opinion, it is reasonably practicable to do so; and before making the disposal the Secretary of State shall consult the company". I believe it would be worth while preserving those words from the 1972 Act or at least to use words which enable the Secretary of State to dispose of share capital which he may have acquired. I put down Amendments at Committee stage which were probably much milder than those which have been nut down now; but I am sorry that the Government appear to have decided that once they have acquired shares in a company they will hang on to them, almost regardless of what happens.

Lord MELCHETT

I think the Amendments which my noble friend Lord Lovell-Davis has already dealt with illustrate a deep-rooted political divide between noble Lords opposite and ourselves. We believe that the people of this country ought to be able to reap the benefit of any investments which they make in comanies by taking equity in those companies. I am frankly surprised that Amendments Nos. 66 and 70 should have been lumped in, as I understood it from what the noble Lord, Lord Elton, was saying, with these other Amendments because they seem to raise very different points; and I did not entirely understand from the noble Lord, Lord Elton, what his justification was for either Amendment No. 66 or Amendment No. 70.

Amendment No. 66 deals with Section 8(1)(c) of the Industry Act, which has provided an impediment to the contribution that Section 8 was expected to make towards industrial investment. This was predicted by Members of my Party when in Opposition in another place. By deleting this restriction we hoped to promote further use of Section 8. As noble Lords know. £550 million were set aside up to 1977 for Section 8 financial assistance. Of this, only some £125 million has so far been paid out or committed on schemes of a positive nature designed to encourage new investment or greater efficiency. This includes the £45 million for the ferrous foundry and machine tool industries announced yesterday; so before yesterday it was rather less. The rest of the £262 million paid or committed to date has arisen from unforeseen emergency action to save key industrial capability from being lost. It cannot possibly be argued that this use of Section 8 has fulfilled the objectives described in the 1972 White Paper on Industrial and Regional Development, in particular the words: to stimulate industrial and regional regeneration through new national and regional investment incentives. If I may say so, this sanatorium which was set up by noble Lords opposite, has opened its doors but has not found many willing patients. The Government are therefore seeking to make Section 8 more effective for the purposes for which it was devised by noble Lords opposite. The Industrial Development Advisory Board, in their commentary on the year ended 31st March 1974, particularly noted this condition: …in effect that assistance cannot be provided unless found to be unavailable from private sources of finance on suitable terms and conditions was one of the principal reasons why few applications for assistance under Section 8 have been made by individual companies. It is this restriction we seek to delete in this Bill and which Amendment No. 66 would leave in the Industry Act. While applicants will normally be expected to ensure that the greater cost of a project is provided for outside the public sector, deletion of the present restrictions will remove the necessity for an elaborate process of checking all available potential sources of finance.

The noble Lord, Lord Elton, also spoke about Amendmhent No. 70, and I propose to deal with this rather more briefly. This Amendment would remove the removal, if I may put it like that, of the time limit in Section 8. The Government believe that the powers of Section 8 of the Industry Act, after they have been developed and extended in the way in which Clause 22 provides, can make a considerable contribution to overcoming some of the deep-rooted industrial problems which our White Paper referred to. These problems have persisted over many years. The Government therefore believe it would be totally unrealistic to suppose that the need for Section 8 assistance will have disappeared by 1977 or 1980. We are therefore completely opposed to limiting the life of Section 8 in the way that Amendment No. 70 would do.

Lord ELTON

My Lords, I have listened with close attention to what has been said by noble Lords on the other side, and I cannot confess myself to be greatly encouraged by what it amounted to. The noble Lord, Lord Lovell-Davis, said in effect, "We said we were going to do this; we want to do this; and we are going to do it." I accept there is a political division here, and at this stage it would not be proper to divide the House on the principle which he adduces, though it is proper to say that we absolutely dissent from his interpretation of the economic and directorial relationship between industry and Government. In the second part of the answer, the noble Lord, Lord Melchett, elaborated on this and said that in the view of his colleagues and himself it was proper that benefits reaped from the infusion—which we believe should be temporary—of cash into private industry should be reaped on a permanent basis by society as a whole.

There are respectable arguments in favour of this, but there are pragmatic arguments against it. I believe, and I think my noble friends agree, that the benefit to the community would be far greater if, instead of subsuming the expected dividends and profits into the Consolidated Fund, we had as a far greater asset in this nation a healthy, independent and therefore diverse industry, which would make profits for the whole of the community and not merely reduce the expenses of administration, as it is now intended should be the case. On the time limit, I was anxious to hear what noble Lords had to say about it. On this point we have been told that the benefits of the 1972 Act—an Act which was so widely deplored by noble Lords opposite when it was brought into being and is now so improved that these benefits will last for a great time—Does the noble Lord wish to interrupt?

Lord MELCHETT

My Lords, I am grateful to the noble Lord for giving way. I did say "as improved by this Bill will last for a long time".

Lord ELTON

My Lords, that is also what I was attempting to say when the noble Lord came to my aid. He believes that, as "improved" by this Bill, the benefit will be everlasting. I would point out to the noble Lord that the Act is now under Parliamentary review as a result of this Bill. As it stood, had they left the time limit in, it would automatically have been subject to Parliamentary review and renewal in 1977 or, under a later Amendment, in 1980. That is a process which I thought would have been salutary. If it was working well it would take little Parliamentary time, and if it was working badly it would deserve a great deal of Parliamentary time. But Parliamentary time in August is at a premium. Therefore, beyond expressing profound discontent at what I have heard and reserving the right to return on Third Reading to this matter if I am not satisfied, with my persual of Hansard, with some Amendment, I beg leave to withdraw this Amendment.

Amendment, by leave, withdrawn.

Lord ELTON

My Lords, may I refer your Lordships to the list of Amendments I gave at the beginning. I do not intend to move Amendments Nos. 64 to 73. I am not moving these Amendments in order to save time. One of them relates to a point which is substantially covered and can be raised under Amendment No. 74 by my noble friend Lord Drumalbyn, and I may again take part in the discussion on that Amendment.

4.51 p.m.

Lord DRUMALBYN moved Amendment No. 74: Page 19, line 10, at end insert— ("(3) Notwithstanding subsections (1) and (2) above, where any share capital or stock has been acquired by the Secretary of State in a company under the provisions of subsection (3) of section 7 or subsection (3) of section 8 of the Industry Act 1972, the Secretary of State or, if the share capital or stock is transferred to the National Enterprise Board under section 5 of this Act, the Board, shall dispose of the share capital or stock as soon as, in the opinion of the Secretary of State or of the Board, as the case may be, it is reasonably practicable to do so; and before making the disposal the Secretary of State or the Board, as the case may be, shall consult the company.")

The noble Lord said: My Lords, I beg to move the Amendment standing in my name on the Marshalled List. The purpose of this Amendment is quite clearly to secure that when before the passage of this Bill money has been advanced under Sections 7 or 8 of the Industry Act the terms on which that money was advanced should be observed. One of the terms under which financial assistance was given—and the financial arrangement, let us bear in mind, was bilateral—was that the shares should be disposed of and the loan repaid as soon as possible. Normally the recipient enters into obligations and the Secretary of State also makes undertakings in these circumstances. As I understand it, in this case Parliament is being asked to vary unilaterally one of the obligations on the part of the Secretary of State, and a very important condition on which the recipient agreed to accept assistance in exchange for shares. It is one thing to change the statutory terms on which future arrangements may be made; it is quite another to change what are virtually contractual arrangements determined by Statute which have already been made. What the noble Lord is doing is asking Parliament to authorise his right honourable friend to go back on the word of Her Majesty's Government.

I think the noble Lord said that only £125 million had been advanced out of the £550 million which would have been available under the previous Act, and in fact still is available. That is quite a considerable sum in itself. Even the £252 million which has been advanced was presumably subject to the same restrictions. These are bilateral arrangements. One cannot get away from that, and it is quite wrong for them to be varied by one side. Parliament, it is said, can do anything; but Parliament is not expected to do that kind of thing because it is a sort of repudiation.

The question that is very much in my mind in dealing with this kind of arrangement—the noble Lord was talking about the future—is exactly what is the status he envisages of these arrangements that are to be made. We have been told time and time again that all arrangements, all acquisitions of shares, are voluntary and can be dealt with only by voluntary consent. Does this not apply to Section 3 as affected by the provisions we are now discussing? The noble Lord was saying that there had not been very many willing occupiers of the sanatorium—I think he put it in that way. What reason has he to suppose there will be many more willing occupiers if he makes the terms very much stiffer? Admittedly, he will make it easier to acquire a shareholding, because he will probably not propose anything else. It is an odd form of voluntary agreement. It seems to be, "Here's the money. We want your life." If they acquire more than 50 per cent. of the shareholding they are taking away the whole of the control of the enterprise. That is by the way, because of course up until this time it is not germane to this immediate Amendment. But I should, all the same, like the question answered, because the noble Lord, Lord Beswick, promised to answer it when I spoke at the end of the third day on what was then Clause 17. The main purpose of this Amendment is to secure that we can hold up our heads and say that we have observed the arrangements which were made at the time when these terms and conditions were fixed. My Lords, I beg to move.

Lord MELCHETT

My Lords, I accept that the noble Lord, Lord Drumalbyn, has made a point which has some theoretical validity and it is, as he said, a point which he made at the Committee stage. I do not, however, think that this is a point about which we need to be concerned in practice. The noble Lord, as I understand it, is concerned on behalf of some companies. But the Government's plans to change the terms of the 1972 Act in this way have been public knowledge now for six months, and to the best of my knowledge none of the companies affected, none of the companies in question, has advised the Secretary of State of any disquiet. If they have expressed such disquiet, or if they have asked the noble Lord to speak on their behalf, I should of course be very ready to consider particular cases with the utmost seriousness. But if the noble Lord is merely raising a matter on a theoretical basis, which I assume he is, when those directly affected are not in practice concerned, I do not think that we ought to detain your Lordships' House on the matter any further.

Lord DRUMALBYN

My Lords, I have not been briefed by particular companies to speak on this point. But, then, it may be that at the present moment none of the companies is anxious that this condition should be observed; but if, as we hope, things change and pick up in this country then they may very well be strongly interested. Not all of them follow legislation as closely as all that, and they may be surprised at the end of the day when they find that the terms on which they entered into these arrangements have now been changed. I see no reason whatever to change them. Whether or not it is theoretical, the point is that this facility, this safeguard, should not be removed. It should stay as it is. It is a safeguard. It is only a safeguard, if one likes to put it that way; but that it should be taken away, that the conditions should be varied, is not acceptable. I cannot see any advantage in doing it this way. If the time comes when the companies are able to stand on their own feet and can get on without the assistance that was given and has not yet been redeemed in one way or another, then I am sure they would prefer it in that way. Any company would prefer it in that way, and we ought not to remove that safeguard now.

I have an Amendment down for later on which would require the disposals when they are made to be returned to the Treasury—I think to the Consolidated Fund; and I think this is absolutely right. Once the purpose for which the financial assistance was given has been achieved, then it is right that the money should be paid back to the Consolidated Fund and be available to assist other enterprises in the same way or for other useful purposes. There is no useful purpose to be served by the shares remaining in the hands of the Treasury, or the Secretary of State, or the National Enterprise Board or whoever may be holding them. No useful purpose can be served by that and there is this very pressing necessity for the reduction of debt in this country.

On Question, Amendment negatived.

Clase 27 [Persons to whom duty to disclose information applies]:

5.3 p.m.

Lord ROCHESTER moved Amendment No. 75: >Page 21, line 3, leave out from ("and") to ("with") in line 4 and insert ("employee representatives").

The noble Lord said: My Lords, we come now to the important clauses which deal with the question of the disclosure of information. Those of your Lordships who were present at the Committee stage of the Bill will recall that my noble friend and I then put down an Amendment in similar terms to Amendment No. 75. In the end, we did not move that Amendment because there seemed to be a possibility of finding common ground between a number of noble Lords who spoke—notably, the noble Lord, Lord Campbell of Croy, the noble Lord, Lord Houghton of Sowerby, and the noble Earl, Lord Balfour. Unfortunately, the hopes that a number of us then had that such common ground might be found have not materialised, except in one particular that I very much welcome; namely, that the noble Lord, Lord Campbell of Croy, and the noble Lord, Lord Drumalbyn, have joined my noble friend Lord Beaumont of Whitley and me in lending their names to Amendment No. 75 and, indeed, to a number of other Amendments which your Lordships will see on the Marshalled List, in more or less the same wording, which are consequential upon Amendment No. 75.

These Amendments all seek to ensure that the arrangement, whereby a manufacturing company which is making a significant contribution to the economy of the United Kingdom may eventually be required to disclose information to representatives or authorised representatives of relevant trade unions, should be altered, so that the legal rights to information go to the representatives not of trade unions but of employees generally. Turning to Amendment No. 83, which stands in the names of the noble Lord, Lord Houghton of Sowerby, and the noble Lord, Lord Bruce of Donington, which seeks to define the term "relevant trade union" and the Amendments which stand first in the names of the noble Lord, Lord Campbell of Croy, and the noble Lord, Lord Drumalbyn, and, secondly, in the names of the noble Lord, Lord Beaumont of Whitley, and myself, which seek to define the term "employee representative", it is fair to say that all of us have felt obliged to go our separate ways.

I do not know how your Lordships wish to deal with this matter, but since the noble Lord, Lord Houghton of Sowerby, agrees that if Amendment No. 75 is carried his Amendment, No. 83, falls to the ground, it may be convenient to the House in general that we should now have a general debate which covers not only Amendments Nos. 75 and 77, to which I shall refer in a minute, but also Amendments Nos. 78 and 83 which deal with the definitions to which I have just referred.

When I have finished speaking, the noble Lord, Lord Campbell of Croy, may wish to follow me and it may then be convenient if the noble Lord, Lord Drumalbyn, and the noble Lord, Lord Houghton of Sowerby, spoke to their respective Amendments. I understand that this suggested procedure is acceptable. In the hope of saving time, I shall also assume that your Lordships are familiar with the arguments which were advanced at Committee stage against the Government's proposal that legal rights to information should go exclusively to the representatives of the relevant trade unions, and that your Lordships are also familiar with the arguments in favour of the various proposals that were put forward at the Committee stage. For my part, I shall endeavour, so far as possible, not to go over the same ground again, but there are a few points which I must repeat in order to remind your Lordships why it is that we on these Benches feel that legal rights to information should not go to trade union representatives alone as the Bill prescribes.

In those companies in which trade unions are strongly represented—here may I reiterate that I should like trade unions to be strongly represented throughout British industry—employee representatives on works councils and bodies of that kind will themselves be trade union members. In those cases the information will go, as the Government desire, to trade union representatives. But in those many companies in which trade unions are not strongly represented—where the employees who are trade union members are in a minority or where, in some cases, trade union members are almost non-existent—we see no reason why legal rights to the information should be withheld from employees. In each case, we think that the position will be adequately covered if the rights are given to employee representatives. In our view, there is no reason for any reference in this Bill to trade union representatives.

At the Committee stage, the noble Lord, Lord Beswick, stressed that there is nothing in the Bill to prevent companies from giving information to employees or their representatives. I acknowledge that that is true, but in our view it does not adequately explain why these reserve statutory powers in the Bill, which oblige companies to disclose information, should favour certain privileged groups and not others. I will not labour this point, because in the debate at Committee stage, a great deal of support for this general proposition came from all parts of the House.

May I now refer your Lordships to Amendments Nos. 77, 78 and 83 in which three different proposals are put forward as to how to define those to whom information is to be disclosed. It is fair to say that these Amendments have at least one thing in common. They seek to break the monopoly position of trade unions. We on these Benches think that the recipients of information should be employee representatives, and in Amendment No. 77 we have defined that term as, …employees of the undertaking to which such information relates (being an undertaking employing more than 50 persons) who are the duly elected representatives of all employees in that undertaking)". I hope that that definition will speak for itself for the moment, but I shall return to it briefly later.

I am in the difficulty that I cannot anticipate what the noble Lords, Lord Drumalbyn and Lord Houghton of Sowerby, will say in favour of their Amendments but, nevertheless, I should like to try to explain why, in my view, Amendment No. 77 is to be preferred to either of the other two Amendments, and it will then be for your Lordships to decide between them.

Referring first to Amendment No. 83, I had hoped, from what the noble Lord, Lord Houghton, said in Committee, that he might accept that legal rights to information should be given to representatives of trade unions, works councils, staff committees or other representative consultative bodies, and I stress the words "or" and "consultative". As I understand the Amendment tabled by the noble Lord, Lord Houghton, in his view the information should be given to representatives of both trade unions and these other bodies where they are present in the same firm, provided that these other bodies are recognised by the employer for the purposes of negotiation alone.

There are several reasons why my noble friends and I are not happy about these proposals. There is, first, the reason I have already given, that we see no reason why in this Bill there should be any reference at all to trade unions. Next, we think that information should not be disclosed exclusively to bodies which are recognised for negotiating purposes only, but rather that it should be made available to those bodies which are recognised for consultative purposes. Thirdly, we think that because, according to Clause 27 of the Bill, the information would be required for purposes not of negotiation but of planning and consultation, there is no need for the information to go to anybody who is not employed by the company concerned.

Finally, we are a little troubled, because although under Amendment No. 83 a company might be required to furnish information or to grant rights and facilities to representatives both of trade unions and other bodies where they are present in the same firm, there appears to be nothing in the Amendment explicitly to prevent the Minister under later clauses in the Bill from dealing with representatives of the body or bodies of his choice, rather than with representatives of all the bodies to which, under the Amendment, information would be disclosed and rights and facilities granted.

As regards the Amendment standing in the names of the noble Lords, Lord Drumalbyn and Lord Campbell of Croy, although this comes closer at a number of points to what we have in mind, we feel that it suffers in degree from at least one or two of the disadvantages to which I have referred. We have noted, also, that shop stewards' committees are included among the bodies mentioned in the definition of "employee representative" in this Amendment, whereas they are not specifically referred to in the Amendment tabled by the noble Lord, Lord Houghton. He is not here this afternoon, but at the Committee stage the noble Lord, Lord Cooper of Stockton Heath, who speaks with great authority on these matters, said that some shop stewards' committees are very difficult indeed and that they tell—these are his words—"the relevant trade union where to go". I would only add that, particularly in the case of some shop stewards' committees which cross company boundaries, they are also quite capable of pointing management in the same direction.

I hope I am not making too heavy weather of this, but I can conceive of circumstances where companies, in the words of Amendment No. 78 may be "accustomed to consult" with such committees but where they do this reluctantly. I would much prefer that these committees were not specifically referred to at all in the Amendment, particularly since they are not qualified, as are works councils and staff committees, by the word "recognised".

I think, also, that the wording of Amendment No. 78 may reflect certain fears that if what I may call the "Liberal Amendment" is passed, and is incorporated into the Bill, it may become necessary for certain companies making a significant contribution to the economy of the United Kingdom to set up, for the first time, representative consultative bodies simply in order to fulfil their obligations under this Bill. On that point, I should like to make two points. First, I should be surprised if the great majority of the companies have not already established works or staff councils or committees, or other similar bodies. To the small extent that that may not be true, as I said in Committee we wish postively to encourage progress by companies in this direction, and in so doing to help bring the practice within British industry more closely into line with that of the countries in the European Economic Community.

I have already said that this proposal is in no sense made in opposition to trade unions. Rather is it aimed at helping to promote a sense of true partnership between management and employees within individual firms in this country. At the Committee stage the noble Lord, Lord Popplewell—and I am sorry that he, too, is not here—put to me a very pertinent question on this point, and I fear that on the spur of the moment I did not answer it as fully as I should have done. He asked me who would be the employee representatives on bodies like works councils; how would they be elected and who would elect them? He cearly feared that they would be unrepresentative, unauthorised and unorganised. In my experience in the companies of which we are speaking, they are nothing of the kind. In the case of the undertaking for which I worked until recently, I think I am right in saying that all the representatives on the works committee are now shop stewards. In the words of the definition proposed in Amendment No. 77, they are the representatives duly elected at elections held on company premises and in the working time of all the employees in the undertaking, and they are recognised as such by both management and men. What could be more authorised, representative and organised than that?

I am sorry to have spoken for so long, but it seemed to me that I could best help the House in initiating what will no doubt be quite a comprehensive debate if I first sought to set the scene as fairly as I could for succeeding speakers, and if I then tried to establish to the best of my ability the merits of the Liberal Amendment in preference to the others to which I have referred. That I have sought to do. My Lords, I beg to move.

5.20 p.m.

Lord CAMPBELL of CROY

My Lords, my noble friends and I, in tabling this Amendment with others, are aiming to help the Government to revise this Part of the Bill concerning disclosure of information, and to convert it to a better and more reliable system. We wish to encourage the maximum of voluntary disclosure to employees, and where it is compulsory—that is, where this Bill is making provisions—there should be a simple system which safeguards confidential information, is fair, and where industry can have confidence, including foreign firm investing here or joining in ventures with British firms. The Government have tried to amend the original proposals in the Bill by patching at the Report stage in another place at short notice. The result has been that a large part of the disclosure clauses were hastily considered in another place, and some were not examined at all, owing to the guillotine.

My Lords, at the discussion on Committee stage of this subject, we had various options before us. We considered the different situations in different kinds of company. Not all employees will be members of unions, and although the union representatives recognise that for collective bargaining they may, in many cases, be appropriate representatives for the purposes of receiving information under this Bill, we do not think that the representatives should be restricted to those union representatives. So that the first important point is that the representatives in the Bill should not be trade union representatives only.

The second point is that we believe the information should be transmitted within a company: that it should be disclosed to persons who are employees of the company. As the Bill is drafted at present, the appointed trade union representatives could be persons not employed by the company. There was considerable agreement in Committee among your Lordships on these two points. Although I and my noble friends were proposing some slightly different wording—although some of our amendments were exactly the same as those proposed in Committee by the noble Lord, Lord Rochester—we have now been able to combine wording which we believe should be acceptable to a majority of your Lordships, and which we also think will be easier for the Government to accept. It was with a view to making it easier for the Government to absorb this into the machinery they have already provided in the Bill that I did not use wording which I tabled at the Committee stage. There are some variations, and I entirely agree with the noble Lord, Lord Rochester, that it is useful to discuss the three different definitions before us in this debate.

My Lords, as I understand it, the aim of the definition in the name of the noble Lord. Lord Drumalbyn, is to enable as apt a representation as possible to be provided, given different circumstances, in the cases of different companies, but no doubt the noble Lord will explain his wording later. The alternative of the noble Lord, Lord Rochester, is there for us to consider in his Amendment, and it does not seem greatly different from that of my noble friend. Then there is the third Amendment. No. 83, in the name of the noble Lord, Lord Houghton of Sowerby. That appears to me to seek to cover rather different representation, but it certainly has the same purpose of not restricting the representatives to members of the trade unions.

I would remind your Lordships that the disclosure with which this Bill is concerned is for national economic policies; it is not for collective bargaining. Clauses in a Bill about to come to us, the Protection of Employment Bill, are headed "Disclosure of Information" and it is clear from the text of that Bill that they are concerned with information for the purposes of collective bargaining; so that will be dealt with separately by your Lordships on another occasion. The employee representatives proposed by the Amendment—and there is a whole group of subsequent Amendments if this one is accepted by the House—are acceptable, we believe, both as recipients of the information at the end of the procedure, as well as being participants in the screening procedure when the screening procedure is needed.

My Lords, in tabling this Amendment and the others associated with it, we hope that the Government will see that this is improving the Bill, and making it acceptable not only in Parliament but, we believe, over a wide range of persons concerned outside Parliament.

Lord HOUGHTON of SOWERBY

My Lords, I suppose it will be convenient for us to discuss all these Amendments together.

Lord DAVIES of LEEK

That is what I should like to know.

Lord HOUGHTON of SOWERBY

My Lords, I think it is a little difficult to deal with one Amendment separately from the others. I do not quite know in what order we shall dispose of them, but at any rate for the purpose of the debate it will be convenient for us to cover all the ground so that we know what the options are and what the arguments are in support of each of them.

My Lords, the only thing that the Amendments proposed from the Benches opposite have in common is that they all want to get rid of the relevant trade union and replace it by employee representatives. If your Lordships will look at Amendment No. 75, we see a combination, a kind of coalition, between the Liberal and Conservative Benches in favour of replacing the term "relevant trade union" by the term "employee representatives". From that point on the coalition divides, and we see one version in Amendment No. 77, and another version in Amendment No. 78.

The noble Lord, Lord Rochester, said a moment ago that his Amendment and associated Amendments were not in opposition to the trade unions. I am sure that it true, but all I can say is that if they are not in opposition to trade unions, they scarcely go along with trade unions. Indeed, the principal aim seems to be to delete trade unions, or at least to put the trade union in a secondary position, to lump it with other committees, councils or bodies. This reflects a difference of approach. Where trade unions are representative, they should be given the opportunity of representing the staffs concerned and receiving this information. I fully agree with the noble Lord, Lord Campbell of Croy, first, that we are dealing with compulsory disclosure, the most awkward form of disclosure and secondly, that we are dealing with matters normally within the scope of collective bargaining.

We should bear in mind, however, that in dealing with compulsory disclosure, probably in circumstances where a trade union organisation is not as tidy as it should be, or not as complete as it might be, there are dangers of disturbing industrial relations, normally possibly fairly good, by this trouble over disclosure of information of the kind provided for in this Bill. I want to avoid that. I would therefore recommend the House to reject Amendment No. 77 for this reason. Amendment No. 77 reads: 'employee representatives' in relation to information…means employees of the undertaking to which such information relates…who are the duly elected representatives of all employees in that undertaking". Has the noble Lord, Lord Rochester, considered the kind of shambles that could be created immediately by trying to operate his proposal, riding over the heads of the relevant trade unions, over the heads of recognised staff committee and staff councils.

There must be, as it were, a compendium of consultation. It must be comprehensive, it must go to the ultimate of universal suffrage. This may be all right as an idealistic concept, but it is not practical in the conditions in which this clause would have to be implemented I am sure that there would be a lot of trouble if the Amendment of the noble Lord, Lord Rochester, came to be applied in many conditions. It would be folly, if I may say so with the greatest respect to the noble Lord, to approve his Amendment.

I know that the noble Lord, Lord Drumalbyn, has not moved or spoken to his Amendment, and it would be presumptuous of me to give my views in detail upon it before we have heard the argument. I am in that little difficulty. I was hoping that the noble Lord would have risen straight away to expound on his Amendment No. 78 so that we could come to mine and deal with all the three Amendments together, the principal speeches having been made. But I am in the difficulty now that I cannot ignore Amendment No. 78 and must come to my own, and try to do that without injustice to the noble Lord who has still to move and speak to Amendment No. 78.

I will therefore try to deal with my Amendment in the general context. In my Amendment I have tried not to depose the relevant trade unions. This is important. It is Government policy to give emphasis to the position of trade unions in all conditions of industry today. When we come to the Employment Protection Bill we shall find this element again written into a compendious piece of legislation. We saw it very literally written into the Trade Union and Labour Relations Act 1974 and the subsequent amending Bill which has still to complete its progress through this House. Government policy, rightly in my view in present circumstances it to emphasise the role of the recognised trade union and to give it prominence, to allow it to flourish and to assume responsibility, not to have its position eroded or questioned or doubted by erecting alternatives to it unless they are part of the harmonious relationship between staff and employer or management.

My Amendment recognises that the relevant trade union is there and should stay there. The other two Amendments do not do that; they say that the relevant trade union should go and that the elected representative or representatives should succeed the relevant trade union. All that my Amendment does is to extend in draft statutory form the comments I made on the Second Reading of this Bill and later in the Committee stage.

There are circumstances in which it is not satisfactory or complete to relate only to the relevant trade union. In some instances trade unions may be fully representative on staff councils or committees and they provide a comprehensive representation as such, but there are sectors in many companies where for many reasons—and I gave some of them when I last spoke on this matter—trade union organisation is not fully complete throughout all grades and classes of the organisation Trade union organisation may be strong at one level, weaker at another and even non-existent at another, but for the sake of getting representative employee opinion for negotiation and other purposes it is frequently the case that there is a staff council or committee where all come together and, in my opinion, there is no purpose for which they could better come together than for receipt of information under the Bill. It is not collective bargaining; it is to receive information.

But I am anxious not to disturb any more than is necessary the relationship of unions within an organisation. I am anxious to avoid giving some sections of staff a feeling that they are left out in the cold because they are not classified as the relevant trade union. I am anxious also that the relevant trade union should share its position with other representatives of the staff where there is recognised machinery for that purpose. That is why my Amendment—if I may say so—is so neatly drawn. I extend the definition of "the relevant trade union"—I do not get rid of it—and I extend it only so far as is necessary to embrace the periphery of trade union organisation in certain companies and bodies to enable a recognised staff committee or council to receive this information.

In order to meet the point made to me by some of my trade union friends in your Lordships' House that many irresponsible bodies might form themselves into committees in order to receive this information—"Trots" and Internationals, Socialists, Maoists and God knows who!—and might say, "Here is a chance of getting hold of the secrets of this firm and selling them off to Moscow; let us form ourselves into a committee and get in", my Amendment shuts them out and says that they must be recognised by the employers for the same purposes as are defined in this clause for the relevant trade union. Those purposes are to be found in Section 29(1) of the Trade Union and Labour Relations Act 1974 which you will see set out at the top of page 23 as being the condition of a relevant trade union. In contrast to the extreme looseness of Amendment No. 77 moved by the noble Lord, Lord Rochester, in my Amendment it is all tied up. I will content myself by one comment on Amendment No. 78. If my Amendment is examined in the context of what I have just said, I think it will be seen that it is a better version of what your Lordships should try to do than is Amendment No. 78.

My concluding words are these. We must face the fact that this is a Government Bill. It has gone through another place and has come to us for final consideration. All these matters have been gone over in another place—perhaps not as fully as they should have been because of the guillotine. Nevertheless, if we are talking of a Revising Chamber, which your Lordships' House claims to be, we must have regard to the policy considerations underlying what is contained in the Bill.

This is not just drafting, this is policy; and it is, as I explained at the beginning of my remarks, policy to maintain, to uphold and to promote the position and the powers and responsibilites of trade unions. Therefore, I think we are doing a disservice in all sorts of directions if we do anything in this House which will subtract from the position of responsibility of trade unions. It is no good saying you are not against trade unions and then doing something which is harmful to them, which depreciates their position, which reduces their role and makes them feel less important, and maybe less responsible. Everything we do should seek to promote a sense of responsibility in the unions, because that is where the damage can be done.

I beg of your Lordships to regard this as a very important consideration. I think if you reflect on that you will come to the conclusion that my Amendment is the way to do it. I do not think the Bill by itself accomplishes what it is desirable to do, as in my Amendment, and that is why I regard it as of importance. I sincerely hope that my noble friend will be able to accept it in due season on behalf of the Government.

Lord GEORGE-BROWN

My Lords, oddly enough, I think my noble friend's Amendment is probably the best of those before us. But the longer he went on with his argument the less did he encourage me to think so. The argument that we must build up, reinforce and establish, the trade unions really does not carry in this day and age. I speak as a trade union official of at least as long a period as my noble friend, and in a much rougher area than my noble friend ever operated in. There comes a time when power moves from one set of barons to another. My noble friend must permit me to say, with great respect for his older years and longer experience, that it has happened, and trade unions considered as an organisation can be as mean, as nasty, horrible to individuals, as any other power bloc has ever been. Jimmy Hoffa in the United States would have qualified, in the term of the speech my noble friend has just made. Yet, I imagine, neither he nor I would have actually defended him there. So there is nothing special about trade unions. They can be harsh and mean and nasty. They can constitute power blocs like anybody else.

Why my noble friend and I and others of my noble friends here, joined together, the reason that made us try to establish trade unions when the going was rough, the reason that made us establish the Labour Party, was that we were for individuals; it was for the right of individuals to be able to express themselves. What bothers me about my noble friend's speech is that each of these Amendments—I repeat that I think I prefer his to the others but it is a matter of taste—is trying somehow to open the door, so that the individual who does not want to belong and might have very good reasons for not wanting to belong, to the Teamsters affiliated or whatever, should nevertheless be able to be represented and be heard and be consulted. We will get this again on another Bill which I gather is coming to us a little later on. Tonight I only want to say, for heaven's sake, let those of us who are trade unionists, who know what is happening in our trade union movement stop being—I was going to say lily-livered, but that may be an offensive remark; let us stand up and recognise that our outfits, too, can become affected by power: power corrupts; absolute power corrupts absolutely. If, as my noble friend says, you put it only into the hands of the relevant trade unions that is absolute power that will corrupt absolutely. If I may remind my noble friend, had that been the doctrine 30 years ago his outfit would never have come through because it would not have survived that doctrine.

What is the relevant trade union at any given moment? Some people have to fight to bring another one through. Mr. Law's trade union in Birmingham is trying to control the whole thing. You could decide that is the relevant trade union. So I beg my noble friends on my side, involved with me, who are trade unionists, to recognise that we, too, can become the victims of power, and it is good for us to be available for others to challenge us. We are democratic institutions. We were born, or we created ourselves, to fight power and corruption. Do not, for heaven's sake, let us end up by taking on ourselves the very thing we set out to destroy.

Which of these Amendments we adopt is in a sense not terribly important. I happen, I think, to prefer the one my noble friend has just moved. What I want to make quite clear is that whatever we adopt, whatever we are doing, we are saying to the Government in another place, that the fact that you are described as a trade union does not give you a right, any more than any other organisation, to behave as though you have special privileges that used to belong to the barons.

5.50 p.m.

Lord DRUMALBYN

My Lords, perhaps I may now be allowed to speak to my Amendment. I am sorry that I did not speak before, which would have given the noble Lord, Lord Houghton, an opportunity of discussing my Amendment at the same time. On the other hand, I wanted the advantage of hearing what he had to say, and it was the turn of that side of the House to speak, so I hope he will not resent my having listened to him first.

To a large extent all these Amendments are after the same objectives. All of them have at the back of the minds of the drafters the idea that everybody in the organisation is entitled to information that is to concern their own destinies. The question, therefore, is one of the correct means of communication. Probably in a case like this it is almost impossible to avoid all risk of disturbing relations if one is to achieve that objective. What we have to consider is devising a means of ensuring that the information that is required to be passed by the Act will go through to employees unadulterated, and to devise a means whereby they will get the information in the best possible form. I think that this is what we are aiming at.

One could put it in this form. So far as my Amendment and I think Lord Rochester's Amendment are concerned, we are talking about a company as a unit and of their employees, meaning all their employees and only their employees. I am not quite certain whether the noble Lord, Lord Houghton, is entirely with us in this because I know that the representation of the trade union is a little difficult in this case. So far as my Amendment is concerned, I set out to define what an employee representative is within the meaning of this Bill so as to be able to make it as comprehensive as possible. In other words, we are dealing with companies which may range from practically a single union closed shop company, right down to companies which have a huge diversity of unions, some very large, others very small.

It is not going to be easy to get the proper form of representation. I should like to see it as close to the employees themselves. I had in mind in drafting my Amendment that it would probably be better to have it on a part basis rather than on a company basis as a whole, but complete latitude is left in my Amendment as to which form of representation is adopted. I say: employee representative' means a person who is elected to represent employees or any group or class of employees of the company… That covers whatever it may be, trade unions, plants, or the whole of the company. I suggest in my Amendment that the right way to approach this matter is that the people to be elected as the employees' representatives, and the people to whom this information is to be passed, should be those— whom the company or companies are accustomed to consult on matters which are passed down from above; the communication from the management at the top level down to the grass roots, if you like.

I know there are some who think that that should be identical with the machinery that passes collective bargaining matters from the bottom to the top, but it is not necessarily so. Those of your Lordships who are accustomed to the works of Lord Brown—I do not mean the noble Lord, Lord George-Brown, who is with us today—will know that he devised means of separating these two channels, and recognised that there are certain circumstances in which the company has a right to speak to everyone in its employment. I do not necessarily mean physically speak to, but to be in contact with them.

The Amendment goes on to say absolutely, non-exclusively who may be included. It is not a comprehensive definition of those from whom these representatives should be drawn, but it simply says who may be included: a person elected to represent members of a trade union, a recognised works council, a recognised staff committee and a shop stewards' committee. The noble Lord, Lord Houghton, will recognise the words that he himself used during the debate. I do not think that this Amendment appeared on the Marshalled List first, but it was certainly one of the first to be drafted, and I set out to achieve a formula which would enable us to agree on the sort of channel of communication that we want to achieve.

May I now deal with the point of the noble Lord, Lord Rochester? He is aware that I had some fears that it might be regarded as going too far to expect any company which was required to disclose information, and which did not already have a works council, to set one up. That is one of the reasons why I devised my Amendment in the widest and most comprehensive terms. What we are doing here is feeling our way to something upon which we can all agree. I think that this is possible. We could not reach agreement on simply one channel of communication. This would not be possible. I am not suggesting for a moment that my Amendment is perfect, but I hope that it will be greeted today in the spirit in which it was drafted; that is, as a genuine attempt to reach a wide consensus about the way in which we should deal with what will undoubtedly be a very important but very sensitive problem.

5.57 p.m.

Lord PARGITER

My Lords, seldom have I heard, from this side of the House at any rate, advocates for company unions, which is what I have heard this evening. It is true that that does detract from the recognised trade union as such; it merely adds certain bodies which, in some cases, would be anathema to the trade unions concerned. I speak with some knowledge of trade unions. I have been a member of a union for 60 years, and have therefore had some experience of shop floors, and of the attempts that have been made to establish bodies of this sort from time to time, with which employers would rather deal than with the trade unions. They have usually failed in the long run. The employers have recognised that the trade union is the best body to deal with.

The present position is perfectly simple with a trade union representative. A trade union representative for this purpose could be the chairman of the works committee. He need not necessarily be from outside the works, although he could be. There are certain advantages in having some knowledge outside a certain factory or establishment. A trade union official, properly versed in these matters, would very often be able to advise the people inside the works as to the sort of information which they might very properly expect, and the information which they might extract from that which is given to them. When it is said that these things are removed from collective bargaining, of course I am prepared to accept that they are removed from direct collective bargaining. But when you get the forward planning of a company and what they propose to do, and when the workers look at it to see how it affects them, the matter is not entirely removed from the avenue of collective bargaining, and I do not think one can entirely separate them.

What I am concerned about is that the more we proliferate, the more difficulties we are likely to create. It is simple issue as it is at the moment. There are the representatives of the relevant trade unions, and there may be half-a-dozen of them. If all the good words that are being said by noble Lords opposite, about desiring good trade union representation in all companies and so on, mean anything, this is surely the way in which it can be done. The trade unions will not readily accept that bodies other than those which are properly constituted trade unions should receive the information. If they do, there will probably be a battle between the trade unions and these company unions or staff associations. But whatever you call them, they are company unions, in effect.

During my lifetime, I have engaged in some battles against company unions and if I were still in industry I should continue to do so because I believe that they are an anachronism and that they create uncertainties and difficulties where we really want understanding of what people are, what they stand for and what they do. Therefore, I strongly oppose all the Amendments and I feel that the Bill as it stands is right and that "the relevant trade union representative" is the appropriate person. He may well be the chairman of the works committee or he may possibly be somebody from outside the works, but even if he is outside the works it is not much good unless the information is transmitted to the workers in the works. Therefore this certainly has to have a basis of the people in the works, however it is done. I suggest that the Bill is better left as it is rather than incurring all the complications which will ensue whichever of the Amendments is chosen.

The Earl of BALFOUR

My Lords, I should like to clear up one or two points here. There is no intention on the part of any noble Lord on this side of the House to reduce the trade union position. What we feel, however, is that all employees should be on the same footing, regardless of whether they are members of a trade union. The Government have argued—certainly they did so at the Committee stage—that in the present Bill the disclosure of information must be made to a trade union representative, even if the trade union in question represents a very small proportion of the workers in the company concerned; and that it may of course be given to anyone else. There is a fundamental difference between the Government and this side of the House. It lies in the definition of a "worker". The Government seem to regard workers as those persons who are members of a trade union. We on this side of the House extend the definition of worker to a much wider range and regard a worker as being any employee, regardless of whether he belongs to a trade union.

Of the Amendments before us, the one which I feel best meets the position and which at the same time is absolutely fair to all sections of industry, to those firms which have a closed shop union and to those firms which may be weak in representation as well as those firms some of whose members belong to various unions and some of whom do not, is Amendment No. 78, which stands in the name of my noble friend Lord Drumalbyn. Such is his expertise in this field that the Amendment that he has drafted has many advantages over the other Amendments and I accordingly ask your Lordships to support Amendment No. 78.

Lord PANNELL

My Lords, it would be far better if the Bill were left as originally drafted. The trouble is that the debates last week and today have confirmed an impression which I have always had about this House which is that any noble Lord on the other side who rises to speak regards the words "trade union" with half-hostile eyes. It is all very well to talk about the information which will be handed on. That information which will be given to the great trade unions will not be earthshaking. There is no question about that. Imagine this sort of Amendment being brought forward in the context of the mining industry, for instance. Would the miners stand for it? Of course they would not. Noble Lords should recognise that the trade unions are now one of the estates of the realm. They are so in that they can give or withhold supplies. Mr. Heath found that out. Clearly, they have now come to maturity and they must be given their proper place. Whatever is said in this House—and I hear it continually from the other side—is devoid of reality.

I have been in the trade union movement almost as long as my noble friend Lord Pargiter and I have tilled the same sort of jobs. Of course I do not need the noble Lord, Lord George-Brown, to tell me that there are probably bad men in the trade union movement and that the excesses of power show themselves there. After all for 12 years I was Secretary and he was the Chairman of the Trade Union Group of the Parliamentary Labour Party. Consequently, we travelled a long road together. The sort of speech he made this afternoon would not have gone down in those days. Therefore, I believe that it is far better to leave the Bill as it is and to speak about "the relevant trade union".

Baroness HORNSBY-SMITH

My Lords, no one on this side wants to deny—

A noble Lord

My Lords—

Baroness HORNSBY-SMITH

My Lords, the noble Lord does me an injustice and perhaps he will allow me to conclude the brief remarks which I wish to make. No one wants to deny the right of trade unions to their full representation under the Bill but, in taking the example of the mineworkers, where there is a closed shop, the noble Lord, Lord Pannell, was completely missing the wider consideration that members of both sides of the House have given to the fact that there are many industries and undertakings where a minority of the employees are in what he would call a recognised trade union. For example, there are great retail establishments with highly successful staff associations which have far greater consultation at this time with their boards of directors than applies in factories with a closed union shop. There are 14 million people who are not in trade unions and for noble Lords to say that it is democracy that these people must be denied because they are not in a registered trade union is not doing justice to the Amendments which my noble friend has put forward.

Lord BRUCE of DONNINGTON

My Lords, I wish I could take as simple a view of the problems raised in this debate as has been taken by my noble friends Lord Pargiter and Lord Pannell. Unfortunately, I cannot. Nor, at the same time, can I give any support to noble Lords opposite who, in emasculating the Bill so far and who in their rejection of the term "the promotion of industrial democracy", have already forfeited the right to take part in a discussion which deals with the democratic dissemination of information.

A Noble Lord

My Lords, that is the stupidest thing I have ever heard in my life.

Lord BRUCE of DONINGTON

My Lords, if this part of the Bill had been concerned with the strengthening of collective bargaining, I should have found myself in immediate agreement with my noble friends Lords Pargiter and Lord Pannell and, indeed, when we come to discuss the Employment Protection Bill and arrive at Clause 17, I shall be prepared to resist any Amendment from noble Lords opposite which has for its main purpose the extension of the definition included in that clause. However, we are not dealing with that information. We are dealing with a Bill which, when it returns from another place, will serve its purpose in helping to promote the efficiency of British industry, to promote industrial democracy and to bring about all those policies which were originally incorporated in the White Paper which dealt with the regeneration of industry.

This is a matter of industrial democracy applied at works level. I will not weary the House by repeating the arguments I used in Committee, but it seems to me, particularly after yesterday, when my noble friend announced the formation of a committee to study the whole question of the industrial—democracy and this is a committee which is bound to produce conclusions which will have a profound effect on the whole structure of British companies—in those circumstances and until the findings of that committee are published, it would surely be unwise for my noble friends to adopt a restrictive phrasing in this clause which would run counter to the findings of their committee when those are made known in 18 months' time.

If information is to be given inside a company which is concerned with the promotion of its fortunes, concerned with increasing the ability to make some assessment of the role which that company can play within the economy, concerned with effecting improvements—bearing in mind the restricted amount of information that is required under another clause of the Bill—surely it is far better that that information can be made freely available within the whole range of the company's employees. Employee's as my noble friend Lord Pargiter will know perfectly well, are not by any means confined to the works floor of the factory. There are other people who are fundamentally concerned with the whole future of the enterprise in which they work.

This is not intended to be comprehensive, but I have in mind, for example, sales representatives and those in the lower sections of management who are not always informed by their directors as to what is happening in their firms. I also have in mind others such as production controllers, progress chasers and even inspectors, who are not always informed by their employers of what is happening in the company. These people, even though they may not yet be members of trade unions—although one hopes they will be—are capable of producing some constructive contribution to the future of their company, and of giving some value to any estimate that is made of the role of that company in the economy and in the promotion of the industry generally.

Therefore, I hope that my noble friend will look at this matter again. It is not my purpose, and it has never been my purpose in the whole of my political life, to do anything that would damage the British trade union movement, but there are wider issues here. Other people are involved, particularly at firm level, and therefore I hope that this matter will be looked at again.

Lord DAVIES of LEEK

My Lords, I wish to speak briefly on this matter, without being pedantic and without boring the House. My noble friend Lord Houghton of Sowerby tried to evolve a formula which was worth while. Let us look at what we are really doing. We are not dealing with collective bargaining as such. We are asking in a new system of society—which is moving bang into State capitalism—that persons should get information about policies on the national outlook of manufacturing. Whatever Government may be in power—Liberal, Labour or Conservative—those policies may often mean handing millions of pounds to groups of industries. That is what we are dealing with at this juncture. At the moment, when we are dealing with that broad canvas of public money, often moving—because it has to come in the system of society in which we are living—into these manufacturing industries, a constructive approach to all representatives in a factory, or in industry, should be made.

My two noble friends who have put down this Amendment, have made a constructive contribution to the debate. We are not interfering with collective bargaining, which is another argument. We are dealing with the position as it is at present. I am very glad that we have cleared up all the Amendments. So much has been heard about this matter, and I sincerely hope that noble Lords will keep in mind that it is not so much a Party political point but a constructive approach to the question of what we are to do in manufacturing industry to put Britain first. In putting Britain first, all people in a specific industry should be approached. A formula which does not damage the trade union movement at all, but which enhances its constructive position, has been evolved by my noble friends Lord Houghton of Sowerby and Lord Bruce of Donington. If I speak any longer I shall merely be reiterating arguments that have been brilliantly put from this side.

Lord DOUGLASS of CLEVELAND

My Lords, I do not wish to reiterate any arguments, but merely to express astonishment that the noble Lord, Lord Drumalbyn, has moved an Amendment of this character. As I understand this debate, from the very beginning the Opposition's objection was that confidential information would be disseminated through the trade unions to a particular extent. I now find that the Opposition want to disseminate that information not only to the trade unions, but to every group which cares to call a strike in any industry and which, as a consequence, has a talk with the management. Such groups then come within the ambit of this Amendment and are entitled to all the information which in the past it was sought to deny to the trade unions. Furthermore, such groups would be able to use that information in all the ways about which the Opposition earlier expressed fear. I shall not object to this Amendment, but when the time comes that confidential information about private companies is disseminated throughout the bodies which have an animosity to our democratic system, I will then charge the Opposition with passing an Amendment which has provided an opportunity for the subversives, whom they constantly condemn, to get the information which the Opposition have constantly tried to deny them.

6.16 p.m.

Lord LOVELL-DAVIS

My Lords, I gladly accept the challenge to reply to all the Amendments listed. I make it that there are 26 Amendments associated with Amendment No. 75, which has been moved by the noble Lord, Lord Rochester, and his associates; and there are also Amendments Nos. 78 and 83 to consider. I have listened very carefully to the arguments advanced by noble Lords in favour of their respective Amendments. I hope, however, that I may be excused, in the interests of the House as a whole, if I do not cover every point raised or try to adjudicate as to the merit or lack of merit of these Amendments which are being proposed. Instead I shall endeavour to present the Government's case.

When this point was debated in Committee—and it was debated very fully—I think it became clear that the Government's formula for identifying those to whom information is to be disclosed is probably the most viable. Noble Lords drew attention to the different ways in which employees are represented in different concerns. But my noble friend Lord Houghton of Sowerby, who today again outlined the difficulties in a clear and concise manner, rightly stressed that the best way to provide for the disclosure of information was to representatives of the relevant trade unions, and that the position of trade unions should not be eroded. But although he drew attention to the different ways in which employees are represented in different companies, he and other noble Lords did not perhaps appreciate the degree of flexibility which the Bill currently provides, against a background in which the responsibilities of the company concerned are as clearly defined as possible, without the extension he has proposed in his Amendment today.

The Bill specifies that information should be made available to trade union representatives; it does not specify whom they should be. This gives the company considerable discretion as to which representatives of unions should be furnished with information. It may be union representatives at the level of the plant, for example shop stewards within the company, or it may be district or national officials of the union. As my noble friend Lord Pargiter said, there can be advantages in getting the outside view. The choice has been left deliberately to the company, so that it can make arrangements for disclosure that match its established arrangements for consultation and collective bargaining. The Bill thus provides a considerable measure of flexibility, to match the particular circumstances of a company.

Moreover, the Bill in no way prevents employers from disclosing information to non-union representatives; they can continue or extend existing voluntary arrangements. It is not, as my noble friend Lord George-Brown—who seems to have made his usual intervention, and departure—has said, a case of unions acquiring absolute power. It will be open to the company to provide information by other means. A company will be completely free to provide the information it is required to furnish to trade union representatives and to other employees; for instance, works councils, staff associations where these exist or direct to all employees. We in no way wish to prevent this, and the Bill will in no way hinder it. In addition, it is open to all employees to join trade unions, and open to trade unions to seek recognition from an employer in order to benefit from the statutory requirements of the information disclosure clauses.

What the Government do not accept is that there should be a statutory duty for information to be disclosed to representatives of workers other than union representatives. The noble Lord, Lord Campbell of Croy, implied—and my noble friends Lord Houghton of Sowerby and Lord Davies of Leek repeated this implication—that collective bargaining was not involved. The noble Lord, Lord Campbell of Croy, said that this was for national reasons; but Clause 27(1) says: to form or to further national economic policies, or needed for consultations between Government, employers or workers on the outlook for a particular sector of manufacturing industry, including the outlook for the major companies in that sector… Consultations and information disclosure are inescapably—

Lord CAMPBELL of CROY

My Lords, I pointed out that a Bill will be coming to us tomorrow to be discussed, several clauses of which also deal with disclosure of information and which is specific information for collectve bargaining. What the noble Lord has just read out has really confirmed the difference.

Lord LOVELL-DAVIS

My Lords, I agree; but you cannot dissociate this Bill from collective bargaining. This is the point I am making. Consultations and information disclosures are inescapably linked with collective bargaining. Collective bargaining must involve consultations, and collective bargaining is the responsibility of the trade unions. Any attempt to separate them, so that unions dealt with collective bargaining and other representatives dealt with consultation, would be likely to result in misunderstanding and confusion, as my noble friend Lord Pargiter has pointed out. We are concerned to accept that unions have a role, and to take the steps necessary to ensure that there will be strong and responsible unions to discharge their powers and duties. This we view as a step towards our goal of having unions play a full and constructive part in collective bargaining, in consultations and in industrial democracy.

The noble Lord, Lord Rochester, said that he saw no reason for reference to trade union representatives. We believe that the trade unions are the proper means through which workers can have an effective say in management decisions which affect their working lives and the most effective and reliable for management, too. We made this clear in the White Paper when we spoke of "trade union representations from the firm" and of "union representatives to companies" as the means of disclosure.

I must point out to noble Lords how unsatisfactory is the definition of "employee representatives" which has been proposed. Disclosure would be made only to persons "who are the duly elected representaives of all employees in the undertaking." As my noble friend Lord Houghton of Sowerby pointed out, this is simply not practical and will be bound to lead to trouble. In many organisations, there are no persons who are duly elected as representatives of all the employees. What is more, these reserve powers are to be used only in those cases where the employer refuses to make satisfactory voluntary relationships. This is just the kind of employer who is least likely to have in existence a system for electing representatives of all employees. Yet, if there are no such duly elected representatives, the requirements of this Bill will not touch that employer. There is, therefore, a considerable danger that this Amendment will make this Part of the Bill a dead letter. Noble Lords have criticised the Government's proposals, but the Government's proposals are eminently practical because they build on the representational arrangements that now exist. They are also the safest way of ensuring full and fruitful co-operation.

6.26 p.m.

Lord ROCHESTER

My Lords, we have had an excellent debate and if it is appropriate for me to do so I should like to thank noble Lords who have contributed from all sides of the House. I was very disappointed in what the noble Lord, Lord Lovell-Davis, said on behalf of the Government in response to the debate. It seems to me that he made very plain once more the point that there is nothing in the Bill to stop employers giving information to people other than trade union representatives; but he seems again to have missed entirely the point made from all sides of the House, that what we object to is these reserve statutory powers binding a company to give this information solely to trade union representatives and to no other.

He made the point also that, according to Clause 27, the information was needed for collective bargaining. I cannot accept that for a moment. Clause 27 specifically says that the information may be needed, "to form or further national economic policies" in general planning, or needed for consultations.

Lord LOVELL-DAVIS

My Lords, I did, I hope, make clear that you could hardly have consultation without its leading to collective bargaining.

Lord ROCHESTER

My Lords, I feel that if this information were really intended for collective bargaining and negotiation, that should have been made clear in the Bill. As the noble Lord, Lord Campbell of Croy, said, we are tomorrow morning to debate the Employment Protection Bill which makes it plain that information for collective bargaining purposes is covered by that Bill, rather than by this one.

Although he is not here, I should like to thank the noble Lord, Lord George-Brown, for what it seemed to me was some negative support. I realise that, marginally, he came down in favour of an Amendment other than my own, but he seemed to agree that what is proposed by the Government in the clause as it now stands is unacceptable. The noble Lord, Lord Houghton of Sowerby, felt that we on these Benches were seeking, as he put it, to ride over the heads of the trade unions. I had hoped I had made it plain that we were trying to do nothing of the sort. I specifically said that I want to encourage a state of 100 per cent. union membership throughout British industry. He felt that where there were unions represented, it was through the unions that this matter should be dealt with. I agree, but it is not through unions as such that the matter should be dealt with; but rather through union people, in so far as they sit on these representative consultative bodies. He said nothing to make me feel that employee representatives rather than representatives of the relevant trade unions should be the test to be applied in this clause, and in the light of the debate I feel justified in pressing Amendment No. 75.

I am a little less sure whether, when the time comes, I should seek also to press for the adoption of Amendment No. 77. I do not know what the noble Lord, Lord Drumalbyn, may have to say about this, but I like the modest way in which he said that his definition was put forward with the intention of simply helping. My own feelings, for what they are worth, are that we might both be wise to give a little further consideration to the precise definition of the terms "employee representatives" before the Third Reading. I hope that in the light of the criticisms I have felt obliged to make of his definition he might agree. So far as Amendment No. 75 is concerned, I feel

Resolved in the affirmative and Amendment agreed to accordingly.

obliged, in the light of the debate, to press it to a Division.

6.30 p.m.

On Question, Whether the said Amendment (No. 75) shall be agreed to?

Their Lordships divided: Contents, 90; Not-Contents, 58.

CONTENTS
Aberdare, L.	Erskine of Rerrick, L.	Newall, L.
Amherst of Hackney, L.	Ferrers, E.	Nugent of Guildford, L.
Amulree, L.	Fraser of Kilmorack, L.	O'Hagan, L.
Atholl, D.	Gainford, L.	Pender, L.
Auckland, L.	George-Brown, L.	Pike, B.
Balfour, E.	Glenkinglas, L.	Platt, L.
Banks, L.	Goschen, V.	Rankeillour, L.
Barnby, L.	Gough, V.	Rathcreedan, L.
Beaumont of Whitley, L.	Gowrie, E.	Redesdalc, L.
Belstead, L.	Grenfell, L.	Reigate, L.
Berkeley, B.	Grimston of Westbury, L.	Robbins, L.
Bessborough, E.	Hailsham of Saint Marylebone, L.	Rochester, L. [Teller.]
Birdwood, L.		St. Aldwyn, E.
Bourne, L.	Hanworth, V.	St. Davids, V.
Brooke of Cumnor, L.	Hayter, L.	Sandford, L.
Byers, L.	Hornsby-Smith, B.	Sandys, L.
Campbell of Croy, L.	Hylton-Foster, B.	Sempill, Ly.
Carrington, L.	Killearn, L.	Somers, L.
Chelwood, L.	Kilmany, L.	Strathclyde, L.
Coleraine, L.	Kinnoull, E.	Strathcona and Mount Royal L.
Colville of Culross, V.	Lauderdale, E.
Cowley, E.	Lloyd of Kilgerran, L.	Sudeley, L.
Craigavon, V.	Long, V.	Terrington, L.
Cullen of Ashbourne, L.	Lyell, L.	Teviot, L.
Daventry, V.	Mackie of Benshie, L.	Tranmire, L.
de Clifford, L.	Macleod of Borve, B.	Trefgarne, L.
Deramore, L.	Massereene and Ferrard, V.	Tweedsmuir, L.
Drumalbyn, L. [Teller.]	Merrivale, L.	Vickers, B.
Elles, B.	Monck, V.	Vivian, L.
Elton, L.	Mowbray and Stourton, L.	Young, B.
Emmet of Amberley, B.	Netherthorpe, L.

NOT-CONTENTS
Arwyn, L.	Gaitskell, B.	Pitt of Hampstead, L.
Balogh, L.	Gordon-Walker, L.	Popplewell, L.
Beswick, L.	Goronwy-Roberts, L.	Raglan, L.
Birk, B.	Hale, L.	Ritchie-Calder, L.
Blyton, L.	Henderson, L.	Robertson of Oakridge, L.
Boyle of Handsworth, L.	Houghton of Sowerby, L.	Shannon, E.
Brockway, L.	Hughes, L.	Shepherd, L. (L. Privy Seal.)
Bruce of Donington, L.	Jacques, L. [Teller.]	Shinwell, L.
Burton of Coventry, B.	Janner, L.	Slater, L.
Castle, L.	Kirkhill, L.	Stedman, B.
Champion, L.	Leatherland, L.	Stewart of Alvechurch, B.
Chorley, L.	Llewelyn-Davies of Hastoe, B.	Stow Hill, L.
Collison, L.	Lovell-Davis, L.	Strabolgi, L. [Teller.]
Crook, L.	McLeavy, L.	Taylor of Mansfield, L.
Crowther-Hunt, L.	MacLeod of Fuinary, L.	Wallace of Coslany, L.
Davies of Leek, L.	Melchett, L.	Wells-Pestell, L.
Douglass of Cleveland, L.	Pannell, L.	White, B.
Elwyn-Jones, L. (L. Chancellor.)	Pargiter, L.	Winterbottom, L.
	Peddie, L.	Wynne-Jones, L.
Feather, L.	Phillips, B.

6.38 p.m.

Lord CAMPBELL of CROY Amendment No. 76: Page 21, line 7, at end insert— ("Provided he has satisfied himself that the company or companies concerned have not undertaken so to provide any such information within a reasonable time.")

The noble Lord said: My Lords, we can now propose improvements and simplifications to the procedure in the Bill, having heard explanations for it by the Government at Committee stage. In particular, the noble Lord, Lord Beswick, on Friday 25th July at column 637 of Hansard said: This Bill is concerned with only a few cases and they may never arise. I understood perfectly what he meant. He was making it clear he expected most of the information of the kind in question to be passed on by companies voluntarily, and so do we on this side of the House. The procedure in the Bill is only to be activated when a Minister has concluded that it is important that employees' representatives should have certain information, and the company object because they believe it should remain confidential.

At present there is nothing to indicate a first request has been made and not been complied with by a company. I am sure the noble Lord, Lord Beswick, will agree that there is no point in initiating this procedure if a company is ready to pass on information as required in a reasonable time. For example, the preliminary notice under the procedure in the Bill requires the company to give a notice to employees' representatives within 14 days. That is superfluous if the company is ready to furnish the information itself within one day without objection. I believe that it should be made clear in the Bill that none of this procedure is to be started until the company have been given full opportunity to act voluntarily.

There is a later Amendment in my name to which it may be now convenient to make reference. This is to omit subsection (3). At present the first notification a company would receive would be finding that its name had been submitted to Parliament. That is a heavy-handed way of dealing with this situation. We should like an asurance by the Government that a company would certainly have been asked to pass information voluntarily, and would have indicated that it was not willing to do so before this machinery was activated. If my words are not the best, I am sure the Government can provide something at the next stage. It should be clear that voluntary opportunities should be given first and we believe it would be satisfactory if it were in the Bill. I beg to move.

Lord MELCHETT

My Lords, as the noble Lord says, it is common ground between both sides of the House that this will be a procedure which we hope will never have to be used because companies will act responsibly and provide information voluntarily in all cases. It is therefore also a matter of common ground that the Minister would not embark on the first stage of the compulsory system and the issuing of a preliminary notice if the company had already undertaken to provide the information. Not only would such a step be contrary to the policy of the Government, which both my noble friend and I have outlined, but it would also be a step which would lead nowhere, since the Bill already makes clear in Clause 27(6) that the next step—the making of an order—cannot be taken unless it appears to the Minister that the company will not provide the information voluntarily.

Therefore the only effect of the Amendment would be to lay down in the Bill that the Minister should use his common sense and find out whether the company is providing information voluntarily before he takes the first formal step described in the Bill. I would suggest to the noble Lord that in view of the fact that we are merely writing into the Bill that the Minister should use his common sense, the Amendment is not strictly necessary and that there is really nothing between the noble Lord, Lord Campbell of Croy, and ourselves on this point.

Lord CAMPBELL of CROY

My Lords, I am glad to have the assurance from the noble Lord that the Government would not expect this machinery to be activated until a request had first been made to a company to furnish information to its employees voluntarily and had indicated that it did not wish to do so. But I think there can be misunderstandings because when we were discussing the last Amendment, the noble Lord, Lord Douglass—and I am glad to see that he is here for this discussion—was speaking on the situation under this compulsory system where confidential information would be provided to representatives of trade unions. He had failed to recognise that it is under the voluntary system, which does not include this procedure at all, where sonic confidential information may be given by a company to such employees as it chooses.

The Government have already accepted at the Committee stage that information which gets through the screening machinery—and therefore has been accepted as not causing injury or any breach of confidence—is not confidential. That is the sort of reason why I feel it would be better to have something written into the Bill, because it is not easy for those who have not been absorbed in drafting or discussing this Bill for many days and nights, as some of us have—indeed it is not easy even for some of us—to recognise quickly what the machinery is for. It certainly may not be obvious to those coming fresh to this Bill that the machinery will start only when a company has been invited to furnish information voluntarily and has stated that it does not wish to do so. I do not know whether the noble Lord, Lord Beswick, wishes to say anything?—I am sorry, I thought perhaps he did. In view of the categorical statement made by the Government that this machinery for disclosure of information, starting at Clause 27, will not be initiated until a company has been asked voluntarily to furnish information, I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Lord DRUMALBYN had given Notice of his intention to move Amendment No. 78: Page 21, line 22, at end insert— (""employee representative" means a person who is elected to represent employees or any group or class of employees of the company or companies concerned and whom the company or companies are accustomed to consult on matters affecting their operations or the well-being of their employees, and includes a person elected to represent members of a trade union, a recognised works council, a recognised staff committee and a shop stewards' committee.")

The noble Lord said: My Lords, I am inclined to share the view of the noble Lord, Lord Rochester, that it would probably be better to leave this for further consideration. Obviously we need a definition of "employee representative" but perhaps this might be dealt with on Third Reading. This would seem to be the most appropriate course to follow at the present time, because clearly insufficient people have had time to study the Amendments in detail. I shall not move Amendment No. 78.

Lord ROCHESTER

My Lords, I beg to move Amendment No. 79.

Amendment moved— Page 21, line 32, leave out from second ("to") to ("he") in line 33 and insert ("employee representatives")—(Lord Rochester.)

On Question, Amendment agreed to.

Lord ROCHESTER

My Lords, I beg to move Amendment No. 80.

Amendment moved— Page 21, line 36, leave out from ("give") to ("a") in line 37 and insert ("employee representatives")—(Lord Rochester.)

On Question, Amendment agreed to.

Lord ROCHESTER

My Lords, I beg to move Amendment No. 81.

Amendment moved— Page 21, line 42, leave out from ("of") to ("to") in line 43 and insert ("employee representatives")—(Lord Rochester.)

On Question, Amendment agreed to.

Lord ROCHESTER

My Lords, I beg to move Amendment No. 82:

Amendment moved— Page 21, leave out from beginning of line 45 to ("and") in line 5 on page 22.—(Lord Rochester.)

On Question, Amendment agreed to.

Lord HOUGHTON of SOWERBY had given Notice of his intention to move Amendment No. 83:

Page 22, line 9, at end insert— ("( ) Whatever reference is made to the "relevant trade union" in this and in subsequent sections of this Act, the company or companies concerned shall furnish the information, and grant all the rights and facilities prescribed for the relevant trade union in this Act, to the authorised representatives of employee members of a works council or staff council or other body recognised by the employers for the same purposes as are defined in this section for a relevant trade union.")

The noble Lord said: My Lords, it seems to me that my Amendment No. 83 falls, because the words "relevant trade union" have already been taken out of the Bill. Therefore there is no point in my moving this Amendment.

6.49 p.m.

Lord CAMPBELL of CROY moved Amendment No. 84: Page 22, line 10, leave out subsection (3).

The noble Lord said: My Lords, this is the Amendment to which I referred a few minutes ago. I beg to move this Amendment to leave out subsection (3). The Government have given us the assurance we sought just now, that the compulsory procedure would not be initiated until the company have been given the opportunity to act voluntarily. When the procedure is first started, the Minister serves a preliminary notice. Why is it necessary to inform Parliament of that first stage in the procedure? Parliament is informed of a great many things as it is and this does not seem to be necessary, because Parliament is to be informed at the next stage, if that proves necessary. An order will be laid and either House can Pray against that order. That is surely the moment when compulsion becomes necessary. Compulsion does not become necessary before that.

The order which comes to Parliament at a later stage simply applies the provisions of the Act and it engages the procedure. It does no more than that, but it gives Parliament the information and the opportunity to discuss the order. I think that by providing Parliament with the name of a company at this stage, the impression could be given that a company was being difficult or recalcitrant, when it may be ready to provide the information speedily. It may be that on the first request it had some doubts, but once this preliminary notice had been served the company could well be providing the information. It seems unnecessary and strange that Parliament should need to be informed at that first point.

May I also remind your Lordships that Parliament is going to be kept pretty fully notified of what is happening in these matters, because elsewhere in the Bill, in Clause 21(3)—we have already discussed that clause—it is provided that when a planning agreement has been concluded with a company Parliament is informed of that. That, again, is something significant which it is reasonable for Parliament to be informed about. But I suggest that it is not necessary at the very first stage for Parliament to be informed of names of companies.

Lord MELCHETT

My Lords, I am glad that the noble Lord, Lord Campbell of Croy, has acknowledged the very full way in which the Government are intending to keep Parliament informed of the workings of the Bill. But I am surprised that he should wish to delete this significant provision from the Bill. Since a preliminary notice is the initial trigger for the subsequent use, if necessary, of the compulsory purchase powers for disclosure of information, it is important, in our view, for Parliament to be informed when the use of the power is contemplated. A preliminary notice will make the first formal step by the Government towards the possible use by them of the powers of compulsion—although, as I have indicated, the Secretary of State would have first established whether or not there were satisfactory voluntary arrangements. In the interests of confidence on both sides of industry in the fair and open use of these powers, and of proper Parliamentary accountability over a matter which the Government take seriously, and which indeed noble Lords opposite take seriously, it seems appropriate to us that Parliament should be informed when a preliminary notice is issued. I hope that with that in mind the noble Lord will not seek to delete this subsection.

Lord CAMPBELL of CROY

My Lords, I thank the noble Lord again for giving an explanation of why it should be necessary at this stage. We shall continue to seek explanations on further parts of this machinery, but certainly I have no intention of pressing this Amendment. The provision seemed unnecessary at this stage. I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Lord ROCHESTER

My Lords, I beg to move Amendment No. 85.

Amendment moved— Page 22, line 23, leave out from second ("to") to end of line 24 and insert ("employee representatives").—(Lord Rochester.)

On Question, Amendment agreed to.

Lord ROCHESTER

My Lords, I beg to move Amendment No. 86.

Amendment moved Page 22, line 26, leave out from ("and") to ("an") in line 27 and insert ("employee representatives").—(Lord Rochester.)

On Question, Amendment agreed to.

6.54 p.m.

Lord BESWICK moved Amendment No. 86A: Divide Clause 27 into two Clauses the first (Persons to whom duty to disclose information applies) consisting of subsections (1) to (9) and the second (Disclosure of information by Government) consisting of subsection (10).

The noble Lord said: My Lords, I wonder whether with Amendment No. 86A we might take No. 86B as well. I moved an Amendment rather similar to Amendment No. 86A at the Committee stage. Noble Lords will remember that it was not agreed because it was thought that it might have the effect, either of altering in some way the obligations of the Government to disclose information, or of making them less prominent. I assured the House then, and I do so again, that this arrangement has no effect on the Government's obligations. To make clear that there is no question of the obligations being made less promine4 my Amendments now make clear both that the new clause which will result from the division will have the clear marginal reference "Disclosure of Information by Government", and that it is to become the first clause of Part IV of the Bill, where it will have greater prominence than it now has in subsection (10) of Clause 27.

Having made clear that the adverse consequences which some noble Lords feared at Committee cannot arise, I would repeat very briefly the positive reasons in favour of these Amendments. The present Clauses 27 to 33 are, with the exception of subsection (10) of Clause 27, concerned with a system of disclosure of information to the Government and to employees about the affairs of manufacturing undertakings. The obligations placed on the Government are separate from this system, and it will make it easier for those who in years to come apply this Bill if the separate obligations of the Government and of manufacturing business are set out in separate clauses. I am seeking to achieve greater clarity, and it is for that reason that I ask noble Lords to accept these two Amendments. I beg to move.

Lord CAMPBELL of CROY

My Lords, I know that the noble Lord, Lord Beswick, is concerned about this matter. He was good enough to write to me about it a few hours before this debate. This gave me an opportunity of considering his objective, which I understand is editing and also clarity, which is now confirmed. But his proposal would completely separate the Government's part in supplying information from the responsibility of companies as required in these disclosure of information clauses. This matter was discussed at considerable length in another place, both in Committee and at Report stage; and that is in contrast to large chunks of the rest of this Part of the Bill which, as I mentioned earlier, were not discussed at all or else were discussed only briefly.

However, it is clear from debates in another place that Members of Parliament considered it important that there should be a direct link between the disclosure of information by the Government, for their part, and the disclosure required by companies, for their part. Both are expected to make their contributions to this operation. This is clear from the way that the two operations are included in one clause at the moment, and there can be no ambiguity about it. I hope that the noble Lord will not pursue this Amendment. I spoke about it at Committee stage. I would have spoken a little more lengthily at that stage, but unfortunately the Question was put as I was rising—my fault for being slow. But I take this opportunity now of pointing out that, although the noble Lord is thinking in terms of editing, the effect of this change would probably be to throw some doubt on the Government's part in their contribution in disclosing information. I would advise your Lordships, therefore, on something which may seem to be a small point, none the less to leave the Bill as it is.

Lord BESWICK

My Lords, I hope that the House will not accept the advice of the noble Lord, Lord Campbell of Croy. I think I understand the difficulty that faces him. There was a discussion in the other place. It was not, if I may say so, conducted in an atmosphere in which matters were being considered entirely on their merits. There was a good deal of suspicion as to what was involved, both on the part of the Government and on the part of the Opposition. Since that discussion in the other place there has been a good deal of clarification both of intentions and indeed, of wording in Schedule 4. What I am asking for now is sound common sense. It is based on the best advice I have from Parliamentary draftsmen. I assure the noble Lord that there is nothing in the arguments which he has picked up from the other place, and had they had more time—does the noble Earl wish to interrupt?

The Earl of BALFOUR

My Lords, I am sorry to interrupt the noble Lord, Lord Beswick, but I should like to ask one question. Why does he not alter Amendment No. 86B to make subsection (10) stand as Clause 27A, between Clauses 27 and 28? I am wondering whether Clause 26 will be at the beginning of Part IV of the Bill or whether it will be at the end of Part III. I hope that the noble Lord, Lord Beswick, has followed my point.

Lord BESWICK

My Lords, I am afraid that I have not.

The Earl of BALFOUR

My Lords, may I begin again. If Amendment No. 86B is accepted, Clause 27(10) could be put at the end of Part III but I do not feel that this is the right place to put it. What would be the effect if Amendment No. 86A, which divides Clause 27 into two clauses, resulted in subsection (10) of Clause 27 coming between Clauses 27 and 28? I cannot make it any plainer than that.

Lord BESWICK

My Lords, I am sure that other noble Lords are much clearer about the noble Earl's point than I am. If my Amendment is accepted, the new clause would be the first clause in Part IV of the Bill. I have tried to explain that the Amendment which I am moving is drafted on the best professional advice. Those who have to refer to these matters tell me that it is much better if it is set out in this way and I hope that the noble Earl will accept this advice. Without wishing to raise the temperature of the House, after a certain amount of crosstalk the original decision was taken without proper consideration and advice. I am now saying that after proper thought this is the best division that we can devise. The noble Lord is wrong when he says that this differentiates between information to be given by the Government and information to be given by companies. We were not talking about the obligation of companies to give information. We were talking about the procedure by which they should give information. This is a quite separate procedure. I am talking about an obligation, and because it is a new obligation that we are placing upon Government for the first time in history we think that it would be better to place it in a separate clause. I hope that the House will accept my explanation.

The Duke of ATHOLL

My Lords, before the noble Lord sits down may I ask him a question. I sat for two years on the Renton Committee on the preparation of legislation, and one of its recommendations was that in the interests of clarity clauses should be much shorter and that there should be more of them. Therefore, I support entirely the noble Lord in his endeavours in this regard. Can the noble Lord give the House an assurance that his colleagues in another place will not try to alter what is now Clause 27(10) if we agree to his suggestion to separate it and move it to the beginning of this part of the Bill? If the noble Lord is able to give the House that assurance, I should be quite prepared to agree to his suggestion.

Lord BESWICK

My Lords, on the understanding that I am still making one speech and have given way to an interruption, I will continue. This is what I was hinting at when I said that there was a certain atmosphere in the other place. It was thought that there was some kind of trickery about it. I can give the noble Duke the assurance for which he asks. If this Amendment is accepted, the Government will make no attempt to change it in the other place. On that understanding, I hope that the House will accept my Amendment.

7.4 p.m.

On Question, Whether the said Amendment (No. 86A) shall be agreed to?

Their Lordships divided: Contents, 61; Not-Contents, 49.

CONTENTS
Arwyn, L.	Douglass of Cleveland, L.	Massereene and Ferrard, V.
Atholl, D.	Elwyn-Jones, L. (L. Chancellor.)	Melchett, L.
Banks, L.	Feather, L.	Pannell, L.
Beaumont of Whitley, L.	Gaitskell, B.	Pargiter, L.
Beswick, L.	George-Brown, L.	Pitt of Hampstead, L.
Birk, B.	Gordon Walker, L.	Popplewell, L.
Blyton, L.	Goronwy-Roberts, L.	Raglan, L.
Brockway, L.	Granville of Eye, L.	Ritchie-Calder, L.
Bruce of Donington, L.	Hale, L.	Rochester, L.
Burton of Coventry, B.	Henderson, L.	St. Davids, V.
Byers, L.	Hood, V.	Shepherd, L. (L. Privy Seal)
Castle, L.	Houghton of Sowerby, L.	Slater, L.
Champion, L.	Hughes, L.	Stewart of Alvechurch, B.
Chorley, L.	Jacques, L.	Strabolgi, L. [Teller.]
Collison, L.	Kinnaird, L.	Taylor of Mansfield, L.
Craigavon, V.	Leatherland, L.	Wallace of Coslany, L.
Crook, L.	Llewelyn-Davies of Hastoe, B.	Wells-Pestell, L.
Crowther-Hunt, L.	Lovell-Davis, L.	White, B.
Cudlipp, L.	Mackie of Benshie, L.	Winterbottom, L. [Teller.]
Davies of Leek, L.	MacLeod of Fuinary, L.	Wynne-Jones, L.
Aberdare, L.	Elles, B.	Northchurch, B.
Amherst of Hackney, L.	Elton, L.	Pender, L.
Atholl, D.	Ferrers, E.	Rankeillour, L.
Auckland, L.	Gainford, L.	Rathcreedan, L.
Balfour, E.	Gowrie, E.	Redesdale, L.
Barnby, L.	Hanworth, V.	Rochester, L.
Belstead, L.	Hornsby-Smith, B.	St. Aldwyn, E.
Bourne, L.	Inglewood, L.	St. Davids, V.
Campbell of Croy, L.	Killearn, L.	Sandys, L.
Carrington, L.	Kinnoull, E.	Strathcylde, L.
Chelwood, L.	Lyell, L.	Strathcona and Mount Royal, L.
Colville of Culross, V.	Mackie of Benshie, L.
Cowley, E.	Macleod of Borve, B.	Sudeley, L.
Cullen of Ashbourne, L. [Teller.]	Massereene and Ferrard, V.	Terrington, L. [Teller.]
	Merrivale, L.	Trefgarne, L.
de Clifford, L.	Mowbray and Stourton, L.	Vickers, B.
Deramore, L.	Netherthorpe, L.	Young, B.
Drumalbyn, L.
NOT-CONTENTS
Arwyn, L.	Elwyn-Jones, L. (L. Chancellor)	Ritchie-Calder, L.
Beswick, L.	Gaitskell, B.	Shepherd, L. (L. Privy Seal.)
Brockway, L.	Goronwy-Roberts, L.	Stewart of Alvechurch, B.
Bruce of Donington, L.	Llewelyn-Davies of Hastoe, B.	Strabolgi, L. [Teller.]
Castle, L.	Lovell-Davis, L.	Wallace of Coslany, L.
Champion, L.	Melchett, L.	White, B.
Collison, L.	Pannell, L.	Winterbottom, L. [Teller.]
Crowther-Hunt, L.	Peddie, L.	Wynne-Jones, L.
Davies of Leek, L.	Pitt of Hampstead, L.

On Question, Amendment agreed to.

Aberdare, L.	Elton, L.	Mowbray and Stourton, L. [Teller.]
Amherst of Hackney, L.	Ferrers, E.
Auckland, L.	Fraser of Kilmorack, L.	Netherthorpe, L.
Balfour, E.	Gainford, L.	Northchurch, B.
Barnby, L.	Gowrie, E.	Rankeillour, L.
Belstead, L.	Grenfell, L.	Redesdale, L.
Bourne, L.	Hailsham of Saint Marylebone, L.	Reigate, L.
Brooke of Cumnor, L.		Sandys, L.
Campbell of Croy, L.	Hornsby-Smith, B.	Strathclyde, L.
Carrington, L.	Inglewood, L.	Strathcona and Mount Royal, L.
Chelwood, L.	Killearn, L.
Coleraine, L.	Lauderdale, E.	Sudeley, L.
Colville of Culross, V.	Long, V.	Terrington, L.
Cowley, E. [Teller.]	Lyell, L.	Tranmire, L.
Cullen of Ashbourne, L.	Macleod of Borve, B.	Trefgarne, L.
Deramore, L.	Merrivale, L.	Vickers, B.
Drumalbyn, L.	Monck, V.	Young, B.
Elles, B.

Resolved in the affirmative, and Amendment agreed to accordingly.

7.13 p.m.

Lord BESWICK

My Lords, I beg to move Amendment No. 86B.

Amendment moved—

Transpose clause (Disclosure of information by Government) to after Clause 26 in Part IV.—(Lord Beswick.)

Lord BESWICK

My Lords, if it commands the agreement of the House I think this might be a good time to break, and I move that we adjourn consideration of the Report stage until 8 o'clock.