Lords Sitting of 28 July 1975

Preamble
The House met at half past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Coventry.

PENSIONS AND PAY LIMIT
Lord LEATHERLAND: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how the proposed wage and salary restrictions will affect local government and other pensions where the rate of superannuation is based on the final year's or final three years' salaries.
The MINISTER of STATE, SCOTTISH OFFICE (Lord Hughes): My Lords, my right honourable friend the Secretary of State for Employment made the position on pensions clear in his speech during the Second Reading of the Remuneration, Charges and Grants Bill in the other place last Wednesday. My right honourable friend announced that the arrangements for the payment of pensions under existing schemes may continue unchanged. Such arrangements are not affected by the pay limit. He also said that it will be open to those concerned to decide, if they wish, to continue to calculate pension entitlements on the basis of the rate of pay to which the employer was committed before 11th July, even though that commitment may be limited by the new policy.
Lord LEATHERLAND: My Lords, I thank my noble friend for that Answer. Does it mean, as I think it does, that if a man was supposed to have a £500 increment this year, the year of his retirement, the figure upon which his pension is based would be £500 more than the cash he actually drew?
Lord HUGHES: Yes, my Lords; if that was the commitment entered into before 11th July.
Lord LEATHERLAND: My Lords, I thank my noble friend for that Answer. I am sure that it will give great pleasure to many thousands of local government employees.
The Earl of ONSLOW: My Lords, is it not rather odd that we should base pensions on a notional salary received? I note that this habit was started in another place, but surely a pension should be based on the actual salary, not on the notional one.
Lord HUGHES: My Lords, I think the information given by my right honourable friend in another place has received the same sort of general welcome as that given by my noble friend Lord Leatherland.
The Earl of ONSLOW: My Lords, could the noble Lord, Lord Hughes, go slightly further in answering my question, as opposed to saying what his right honourable friend said in another place, and not repeating it?
Lord HUGHES: My Lords, I do not know what the noble Earl, Lord Onslow, wants me to say. I find the position perfectly satisfactory.
The Earl of ONSLOW: My Lords, what I am asking the noble Lord opposite is this. Is it not very odd to base a pension on a notional salary as opposed to a salary actually received?
Lord HUGHES: No, my Lords. This is not something which has just arisen as a result of these present arrangements. It is something which happens from time to time in the ordinary course of pension and working arrangements.
Lord CROOK: My Lords, is the noble Earl, Lord Onslow, not aware that this is part of the contract of employment of the people in question?
Viscount ST. DAVIDS: My Lords, is the noble Lord aware that this habit has been going on for at least 200 years in the Navy, which has been in the habit of making retiring captains into yellow admirals for the specific purpose of getting them a pension of appropriate size?
Lord HUGHES: My Lords, that goes back before my time! But I will accept the noble Viscount's word for it that it is correct.
Viscount DAVENTRY: My Lords, may I just say that that is not correct?

POP FESTIVALS AND AGRICULTURAL LAND RATES
2.40 p.m.
Lord LEATHERLAND: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what local government rates are paid on land rated as agricultural when it is used for pop festivals and similar purposes.
The PARLIAMENTARY UNDERSECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Baroness Birk): My Lords, although no rates are payable on agricultural land, such uses, if regular and on a significant scale, could give rise to a rate liability.
Lord LEATHERLAND: My Lords, I thank the noble Baroness, Lady Birk, for that Answer, which is partly satisfactory. Is the noble Baroness aware that I do not attend these festivals—
Several Noble Lords: Oh!
Lord LEATHERLAND:—but I have no objection to them? Is the noble Baroness also aware that rate exemption for agricultural land is allowed on condition that the land is used solely for agriculture, and if it is not solely used for that purpose, surely it ought to pay a portion of its rates?
Baroness BIRK: My Lords, where agricultural land is not used for that purpose the question of rateable liability can be decided only by the courts. To my knowledge, there have been no decided cases yet concerning pop festivals, but whether or not the land becomes rateable because of the use of the land for pop festivals or other such uses, depends on the degree of use and the revenue to the owner of the land. I was not aware that my noble friend Lord Leatherland did not attend pop festivals.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, can the
710
noble Baroness give an assurance that, where the pop festival has been sanctioned by the Home Secretary against the wish of the local community, it will not adversely affect the liability to rates of the local community?
Baroness BIRK: My Lords, that is a quite different point, as the noble and learned Lord, Lord Hailsham of Saint Marylebone, is aware. It has nothing to do with rateable liability.
Lord AVEBURY: My Lords, how can the noble Baroness say it is only in cases where the use is on a regular or significant scale, if there have not been any cases before the courts on which determination has been made?
Baroness BIRK: My Lords, I believe there was a case brought before the court concerning an occasion when a fair took place for a certain number of days. There has been no degree of case law on which I can base an answer. Every case has to go to the courts.
Lord LEATHERLAND: My Lords, is the noble Baroness aware that in one or two days a single pop festival can do more damage to the agricultural quality of the land than in a month or two of ordinary usage?
Baroness BIRK: My Lords, this is a matter entirely for the person whose land it is. If the land belongs to a private landowner or a farmer, it is up to that landowner or farmer to say whether he will allow his land to be used for a pop festival.
Lord WYNNE-JONES: My Lords, is the noble Baroness aware that the use of land occasionally for pop festivals is very much welcomed? Is she also aware that the beneficial results of pop festivals are generally acclaimed?

MALAGASY REPUBLIC: U.K. REPRESENTATION
Lord MERRIVALE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether at a time when the Malagasy Republic is currently passing through a transitional and unsettled period, and

711
bearing in mind the long standing friendship and historical ties between our two countries (e.g. the Treaty of Peace, Friendship and Commerce of 27th June 1865) and that country's present need of encouragement and attention, Her Majesty's Government will make a statement on the decision to close the British Embassy in Tananarive.
The PARLIAMENTARY UNDERSECRETARY of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, the decision to close the British Embassy in Tananarive is a direct result of a reductions in public expenditure for 1976–77 announced by my right honourable friend the Chancellor of the Exchequer in his Budget earlier this year. It has naturally been taken with great regret, particularly in view of the long-standing friendship between this country and Madagascar, to which the noble Lord has rightly referred.
Lord MERRIVALE: My Lords, while thanking the Minister for his reply, may I commend to him Article No. 1 of the 1865 Treaty. Does the Minister consider that the decision might be very ill-timed, as the new Head of State, Didier Ratsiraka came to power only last month, and as the country has at present serious social, political and economic problems, and as there could—and I say could—be increased Communist influence there? Would the Minister also consider that the financial saving might be less than the political loss, at a time when, in effect, Madagascar is seeking to strengthen its commercial relations and its cultural links with this country?
Lord GORONWY-ROBERTS: My Lords, I am bound to say that I have every sympathy with what the noble Lord has said. However, when a demand for economy is made as a matter of national policy my Department cannot expect to be exempt. We gave very careful consideration to this matter, and although this post has done useful work, we found that there was no alternative—if we were to meet the table of requirements included in the Budget speech in another place; namely, a 1½ per cent. reduction in our Departmental overseas expenditure—but to decide on closure of some post or posts. I very
712
much regret this, but it is inevitable in the climate of our time.
Baroness ELLES: My Lords, can the Minister say whether any of the other EEC Member-States will be retaining embassies in Madagascar and whether any arrangements will be made for our diplomatic links with Madagascar to be continued through these other Member-States?
Lord GORONWY-ROBERTS: My Lords, I can give the assurance that a number of EEC Member-States will retain their posts in Tananarive. We shall, of course, be seeking to accredit from elsewhere appropriate representation to the capital of the Malagasy Republic and it is perfectly possible—in fact it is rather a good idea—that a fellow member of the Community might be consulted as to the possibility of taking this on.
Lord BROCKWAY: My Lords, I am not sure whether I ought to declare a personal interest, as my grandfather was one of the first Protestant missionaries in Madagascar in the last century. May I ask the Minister this. Would Her Majesty's Government consider at the earliest possible moment British representation in Madagascar, for two reasons? First, its presence might contribute to the fulfilment of democracy there, and, secondly, it lies between the ex-British colonies in East Africa and Mauritius and is tremendously important in that connection.
Lord GORONWY-ROBERTS: My Lords, I most certainly will bear in mind what my noble friend has said. The second part of his supplementary is most apposite, and so is the first, in which he reminds us that missions of every kind are subject to fluctuation.
Lord DRUMALBYN: My Lords, may I ask the noble Lord what he meant by "accredited elsewhere"? Does he envisage that one of our overseas representatives accredited to another Power will also be able to represent Her Majesty's Government in Madagascar? He is, of course, aware that this is done frequently by other countries. May I also ask him whether it would be appropriate or practicable for a High Commissioner to represent Her Majesty's Government, or must it be somebody accredited to a non-Commonwealth country?
Lord GORONWY-ROBERTS: My Lords, I am most grateful for the opportunity to be somewhat more precise on the subject of accreditation. As the noble Lord implies, multiple accreditation in this case, as in similar cases, would mean that we would empower another of Her Majesty's ambassadors to represent us from a point elsewhere. However, in answer to the interesting suggestion made by the noble Baroness, I thought I would say that in considering where this "elsewhere" should be, it might be interesting to talk it over with a member or members of the Community, because they, without naming any one of them, have interests in that region of the world. On the question of the High Commissioner, I think I know what the noble Lord has in mind. There is nothing to rule out the possible accreditation of a High Commissioner to represent us in Madagascar from elsewhere.
Lord SLATER: My Lords, is my noble friend aware that, while there may be some feeling in regard to the Government having to take this line in regard to Madagascar, the same feeling was also ventilated in regard to the Trucial States, when Her Majesty's Government had to take similar action, when we had to withdraw in regard to the defensive purposes and rights which we had held for so long in that part of the world?
Lord GORONWY-ROBERTS: My Lords, my noble friend is quite right and he has adduced an example of the way in which diplomatic requirements fluctuate at a time when, for reasons of economy, we are so reluctantly closing one or possibly more posts. At the same time, new demands are made on our diplomatic service—for instance, in Brussels—and in regard to almost permanent international conferences which call for ambassadorial or ambassadorial-level representation.
Lord MERRIVALE: My Lords, may I ask the Minister two further questions? Would Her Majesty's Government consider asking our High Commissioner in Tanzania, Mr. Mervyn Brown, an ex-Ambassador to Madagascar who also speaks Malagasy, and who is liked by them and is very fond of them, to go over from Dar es Salaam to explain the position of Her Majesty's Government to them, which would be a friendly and good gesture? Secondly, can the Minister
714
say what other embassies are being closed? I understand that there are a total of eight.
Lord GORONWY-ROBERTS: My Lords, the first point is certainly a helpful suggestion. On the second point, if the noble Lord would put down a separate Question, I shall answer it.

CSCE RECOMMENDATIONS AND HELSINKI SUMMIT
2.52 p.m.
Lord BROCKWAY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what proposals they will make to the Summit Meeting at Helsinki for the implementation of the recommendations of the baskets at Geneva on European Security and Co-operation.
Lord GORONWY-ROBERTS: My Lords, recommendations on how the decisions of the Conference on Security and Co-operation in Europe will be put into effect are included in the Final Act of the Conference which will be signed by my right honourable friend the Prime Minister at the Third Stage of the Conference at Helsinki at the end of this week. A copy of the latest version of the Final Act has been placed in the Library of the House. The test of the success of the Conference will lie in how its decisions are fulfilled, and the noble Lord can be certain that this Government will fully honour their obligations.
Lord BROCKWAY: My Lords, while thanking the Minister for that reply, may I ask him whether he is aware that I spent the weekend reading this 30,000 word document of recommendations, particularly the proposals regarding implementation? In view of the quite extraordinary concessions which the Soviet Union has made on human rights, and the concessions which the West has made in economic co-operation, does not everything depend upon their implementation if the transformation of Europe to which The Times referred this morning is to be carried out? Is he satisfied that we should leave it for two years until there is a meeting of the officials, before anything

715
obligatory is done to carry out these recommendations?
Lord GORONWY-ROBERTS: Yes, my Lords, I entirely agree that the proof of the usefulness of this unprecedented Conference and its decisions will be in the implementation of its agreements by all countries who signed them. As to the way of seeing that implementation is carried out, the general feeling was that time should be given so that all signatory countries would be given a chance of implementing what they had signed. We think that that is right. Of course, their performance will be mutually observed and commented upon in the meantime, and most certainly at the end of that period there will be a conference at which a kind of audit of performance will be rigorously conducted. On the whole, I think it is best to give time for members to show that they mean what they sign before we move on to anything like an institutional check-up on what they are doing.
Baroness GAITSKELL: My Lords, could the Minister tell those of us who regard this as a game of basketball that may go on in Helsinki, but who are glad that we are getting together, what are the concessions that the Soviet Union has made?
Lord GORONWY-ROBERTS: My Lords, I do not think that I could exhaust the categories on either side at Question Time. Possibly I might try the patience of the House if I attempted to do that. There are ways in which we might discuss this. We had a useful debate on this at the instance of my noble friend Lord Brockway about two weeks ago. Speaking for myself, and with due regard to the exigencies which beset my noble friend the Lord Privy Seal, I would welcome a further discussion now that the full agreement has been published.
Earl COWLEY: My Lords, does the noble Lord recognise that we on this side of the House support realistic moves towards détente? But since the Security Conference was made conditional on MBFR, may I ask what incentives the Government will give the Russians and the Warsaw Pact countries to end the stalemate in those talks now that the Security Conference documents are to be signed on Wednesday?
Lord GORONWY-ROBERTS: My Lords, I think that two factors arising from the CSCE should help to make MBFR more practical in results. First, there are certain provisions in the CSCE on confidence-building which I shall not go into in detail today but which should stimulate a faster pace of agreement in MBFR. Secondly, now that we have the CSCE settled, as it were, the scarce and highly qualified manpower hitherto engrossed in the CSCE should be available to speed up the discussions in Vienna.
Lord BROCKWAY: My Lords, while appreciating that this quite astonishing document will require consideration by various Governments, may I ask the Minister whether it would not be possible for the United Nations European Commission on Economic Co-operation in these two years to set up working parties between the Governments to work out these plans in detail? May it not be possible to establish a human rights commission, which will enable us to draw attention to any infringements by the Soviet Union of the decisions to which it has pleged itself?
Lord GORONWY-ROBERTS: My Lords, I have indicated as briefly as I could the Government's view, and that of other Governments, on the question of setting up institutions ahead of practical experience of the working of the agreements. I think it would be wise to let this run to see how it works and who works it, before we get down to the detailed question of prescriptive observance by institutions of how the agreements are working. I understand my noble friend's concern that this should not simply be something on paper, but, as no doubt my right honourable friend will say in Helsinki, as indeed all Heads of State who have pronounced on this have already said, the proof of this is in the implementation. This is not a legal document: it is a statement of standards for European countries to reach. They should be implemented, and we shall be very concerned to see that they are.
The Earl of ONSLOW: My Lords, would the noble Lord tell us his ideas on the free movement of people, for instance, from Czechoslovakia and Hungary, peradventure, across into

717
Western Europe? Secondly, could he tell us how the balance of forces in Russia and Eastern Europe vis-à-vis Western Europe has changed since the discussions have been going on in Helsinki?
Lord GORONWY-ROBERTS: On the second technical question, my Lords, not without notice. On the first, in Basket III there are very detailed provisions for the free movement of persons for personal, professional or, indeed, religious reasons from one country to another. If only that part of the agreement was faithfully carried out it would prove a great boon to many people in Europe.

PRIVATE BILL STANDING ORDERS
The CHAIRMAN of COMMITTEES (The Earl of Listowel): My Lords, I beg to move the Motion standing in my name on the Order Paper. At this time in the Session I usually have to ask your Lordships to dispense with Standing Order No. 147 in order to enable certain Private Bills to pass through both Houses of Parliament before the Summer Recess. The purpose of suspending this Standing Order is to shorten the period between the Committee stage and Third Reading of a Bill by not requiring the Departments concerned to receive the amended Bill three clear days in advance.
Moved, That Standing Order No. 147 (Bill as amended in Committee to be deposited at Public Departments) be dispensed with until the House rises for the Summer Recess.—(The Earl of Listowel.)
On Question, Motion agreed to.

BUSINESS OF THE HOUSE
3.1 p.m.
The LORD PRIVY SEAL (Lord Shepherd): My Lords, I beg to move the Motion standing in my name on the Order Paper. In moving this Motion, may I refer to the programme for two Bills which are affected by it? The Remuneration Charges and Grants Bill has now passed its Committee stage in another place and is expected to complete its remaining stages there tomorrow night. I propose that the Bill should
718
have its Second Reading here tomorrow and for the Committee and other stages to be taken on Thursday. On Wednesday a debate on the economic situation will be followed by a Motion, and the Finance Bill will also be taken through all its stages then.
If noble Lords wish to move Amendments to the Remuneration, Charges and Grants Bill, this will be possible on Thursday and I have arranged that the Public Bill Office will accept notice of Amendments at any time between now and the Committee stage of the Bill, and these will be published from the time when the Bill is received from the Commons. I hope that this arrangement will be for the general convenience of the House. Although unusual, it is not without precedent to put down Amendments before Second Reading. I believe that it is to everyone's advantage to have as much notice as possible of any Amendments that we shall be discussing. I should also inform the House that it is our intention to introduce tomorrow the Community Land (No. 2) Bill which will be for debate on Monday, 4th August.
Moved, That Standing Order No. 38 (Arrangement of the Order Paper) be suspended until the Summer Recess so far as is necessary to give the Government power to arrange the order of business; and that Standing Order No. 44 (No two stages of a Bill to be taken on one day) be suspended for the same period.—(Lord Shepherd.)
Lord CARRINGTON: My Lords, the Motion which the Leader of the House has just moved is one we have come to expect all Governments to move at this time of the year, so nobody on this side of the House would object to what the noble Lord is doing. However, I should like to clear up two points arising out of what he said. First, I understood him to say that the Second Reading of the Remuneration, Charges and Grants Bill would be taken tomorrow. Did the noble Lord mean that?
Lord SHEPHERD: I did not, my Lords. I was doing some quick paraphrasing of a prepared statement and I misunderstood or mistook my own writing; the Second Reading will be on Wednesday with the Committee stage on Thursday.
Lord CARRINGTON: My Lords, that seems to have cleared that up satisfactorily. I hope that my other point will be cleared up equally satisfactorily. In all parts of the House, and certainly on this side, I think there is increasing concern about the amount of legislation which is left for the spill-over, the four weeks before the Prorogation of Parliament. There is no doubt that the House will be very busy indeed. There are three Bills, two of which will only just have been discussed by your Lordships, and all of them have to be on the Statute Book, if the Government have their way, by the end of the Session. They are the Community Land (No. 2) Bill, the Employment Protection Bill and the Petroleum and Submarine Pipe-lines Bill. I doubt very much whether in that short time those three Bills can be discussed by the House in the way they should be discussed. Indeed, two of them have large sections which have never been discussed at all by the House of Commons. Consequently, I am exceedingly worried about what may happen to your Lordships in that month.
All Governments—I am not making a Party point here—make a habit of pushing everything to your Lordships' House at the end of the Session; but there comes a moment when it is almost too much for the House to bear, and it might very well be that unless the Leader of the House finds some other means it will not be possible for the House to do that which he is asking. It is proposed, as I understand it, that next week the second day of the Report stage of the Industry Bill should be taken and that at the same time we should take the Third Reading. I really do not feel that my noble friends and I could agree to that—
Several Noble Lords: Hear, hear!
Lord CARRINGTON:—and it does not seem to me right that on a Bill of this importance, a Bill as controversial as the Industry Bill, we should have the Report stage and Third Reading on the same day. I therefore ask the Leader of the House to take note of the fact that certainly we on this side of the House could not agree to that.
3.7 p.m.
Lord BYERS: My Lords. I wish to endorse what the noble Lord, Lord
720
Carrington, has said. This House is in grave danger of risking its reputation as the Revising Chamber if we go on putting this sort of pressure on it at this time of the year. I must express to the Leader of the House my serious doubts about the way in which we are asked to treat the Remuneration, Charges and Grants Bill, by taking all the remaining stages in one day. This Bill has been hastily put together, a tremendous number of Amendments have been put down and selected in another place, and it may be that we shall not only require a Committee stage but a Report stage if, as a Revising Chamber, we are to do our job properly.
Lord SHEPHERD: My Lords, I am entirely in the hands of the House in regard to our business. As the noble Lord, Lord Carrington, said, all Governments at this time of the year find themselves in embarrassing situations. I tell the noble Lord, Lord Carrington, in all honesty, that I find myself in perhaps the most embarrassing situation because I freely recognise that the pressure of business this year is abnormally heavy; but some of that pressure is as a consequence of agreements reached through the usual channels in another place to overcome some of their problems, and of course we have been aware of those arrangements.
This is one of the reasons why we have a particularly short time for dealing with the Remuneration, Charges and Grants Bill. The Bill is required for Royal Assent by 1st August and I am quite willing—I have already had some conversations—to have conservations through the usual channels on how best this Bill can be conducted through your Lordships' House. I had intended to take all stages on Thursday with the general debate on the White Paper on Wednesday; but it had been put to me, again through the usual channels, that it might be wiser to take the Second Reading on the Wednesday, leaving Thursday much freer for the Committee and remaining stages of the Bill. If the noble Lord, Lord Byers, feels very strongly in regard to the Report stage, I am willing to listen to any representations to see whether the situation can be met; but I suggest that we see how we go with this Bill.
Lord BYERS: My Lords, the difficulty is that the Report stage is not being taken in another place until tomorrow and we

721
shall not know the attitude of the Government and therefore what attitude this House ought to take as to the Amendments which should be put down here.
Lord SHEPHERD: My Lords, that I fully appreciate. The noble Lord, Lord Byers, is as well aware as I am of the problems and difficulties in another place. If the noble Lord would wish, I will develop my speech somewhat on Wednesday to indicate to your Lordships what Amendments have been made between the conclusion of the Committee stage on Friday afternoon and the Wednesday.
In regard to the problem of the spill-over, it is true that we have three major Bills. Looking at the programme, I should have thought that we could have done justice to these Bills; but I can only say to your Lordships that if there is a genuine desire for a fuller examination of them, then I am quite willing to suggest to your Lordships that we come back sometime in September so that we might then have a much more relaxed examination of the legislation.
In regard to the Industry Bill, I recognise that it is controversial. I would not hazard a guess what will be the situation for some of our companies which may need assistance during what may be our Summer Recess. I should have thought that there was very great advantage in having the Bill on the Statute Book by the Summer Recess, but that is a matter for your Lordships. I am quite willing to have further discussion with the noble Lord the Leader of the Opposition to seek to persuade him and his noble colleagues to let the Bill receive the Royal Assent by then but, if your Lordships insist, there is nothing I can do but let the Royal Assent take place in the spill-over. However, I do not believe that it would be for the good of many companies which are in need of assistance from an organisation like the NEB that we should delay the passage of the Bill.
Lord SLATER: Is my noble friend aware that, being one of the greatest employers of labour in the country, we should take into consideration the employees in Government service who will be responsible in the various Departments? I was rather surprised to hear the observations of the noble Lords, Lord Carrington and Lord Byers. The noble
722
Lord, Lord Byers, especially, as an old Parliamentarian from the other place, ought to know the procedure and how matters are conducted there. It was rather remarkable to hear the observations which he made in support of the noble Lord, Lord Carrington.
Lord SHEPHERD: My Lords, I only say to my noble friend that I feel that the noble Lords, Lord Carrington and Lord Byers, have done something perfectly understandable and right. I am indeed fortunate that neither of them quoted a speech that I made in 1971, on a very similar occasion when I said, "Enough is enough!" never dreaming that I should have to deal with a similar situation. But this is a matter for the House. I do not complain. I believe that it is right that Governments should from time to time be brought to heel if they put too great a burden on both Houses. However, I feel that this is a matter which can best be dealt with through the usual channels with our usual degree of harmony and understanding. I believe that in the end we shall reach the best solution.
Lord DRUMALBYN: My Lords, with regard to the Industry Bill, may I say that we on this side of the House very much doubt whether it will be necessary to carry the Industry Bill through in order to help companies. The previous Government put the Industry Act on to the Statute Book and Sections 7 and 8 of that Act still remain. It is very much more important, I believe, that we should not give the impression in the country that we are hastening legislation through and are not discussing it properly.
Secondly, the noble Lord said he was proposing to give a First Reading to the Community Land (No. 2) Bill. Is not this a second example of a rather dubious practice—namely, is it not being brought forward a little too soon? We have already had that procedure with the Protection of Policyholders Bill, but that was for a very different reason. Now we are having a Bill brought to this House before it has been fully discussed in another place, and we shall be debating on Second Reading what may well not be the Bill as it ultimately comes to this House. Surely that cannot be right? It is just an example of how the House is being grossly overladen and of how the

723
possibility of discussing legislation properly is being denied to this House.
Lord SHEPHERD: My Lords, with regard to the Industry Bill, I should have been very much happier and should perhaps have concurred with the noble Lord, Lord Drumalbyn, had the Industrial Reorganisation Corporation still been in being. The noble Lord will know what I mean when I say that. With regard to the Community Land (No. 2) Bill, the proposal is made for convenience in order that the House may debate the broad principles of the Government's proposals. The Bill, when it conies from another place, will of course be subject to debate; but it is hoped—again through the usual channels—that having had a broad discussion of the general principles, your Lordships will be willing to give the Bill a formal Second Reading when it comes from another place and to start work on the Committee stage immediately. In my view—and I believe the noble Lord will agree—that is the real purpose of your Lordships' House.
Lord ROCHESTER: My Lords, is it really necessary, in addition to the Report stage and Third Reading of the Industry Bill, to take the Second Reading of the Employment Protection Bill next week? Some of us are engaged on both Bills. Would it not be more sensible to deal with only one, the Industry Bill, and to seek to get it right so far as this House is concerned, rather than starting on the Employment Protection Bill, since we cannot hope to discuss it further in Committee for another month or two?
Lord SHEPHERD: My Lords, the noble Lord would be correct, and I should be very happy to go along with him, if the House would be willing to come back in September to debate the Second Reading and then go on into Committee in the spill-over. Unless we either come back in September or take the Second Reading next week, it will not be possible to provide the usual time between Committee and Report stage to which your Lordships' House has always attached special importance.
The Earl of LAUDERDALE: My Lords, without wishing to distract the Leader of the House and noble Lords opposite from the enticing prospect of
724
buckets and spades, is the Petroleum and Submarine Pipe-lines Bill coming to this House before we rise and, if so, on what day are we to have the Second Reading?
Lord SHEPHERD: My Lords, on 7th August.
The Earl of LAUDERDALE: My Lords, while thanking the noble Lord for that information, may I ask whether he is expecting or hoping that that Second Reading will go through on the nod, or is he expecting a real debate about it in view of the unsatisfactory debate we had last week?
Lord SHEPHERD: My Lords, there is a great deal between hope and expectation. My expectation is that it may last a little longer than I had hoped, but I still hope that it will be short.
On Question, Motion agreed to.

LIMITATION BILL [H.L.]
3.18 p.m.
The LORD CHANCELLOR (Lord Elwyn-Jones): My Lords, I beg to move that the Commons Amendments be now considered.
Moved, That the Commons Amendments he now considered.—(The Lord Chancellor.)
On Question, Motion agreed to.
[References are to Bill [167] as first printed for the Commons]

COMMONS AMENDMENTS
[Nos. 1 and 2]
Clause 1, page 2, line 23, leave out from ("to") to end of line 24 and insert ("the act or omission which is alleged to constitute negligence, nuisance or breach of duty, and
(c) the identity of the defendant, and
(d) if it is alleged that the act or omission was that of a person other than the defendant, the identity of that person and the additional facts supporting the bringing of an action against the defendant.").
Clause 1,Page 2, line 26, leave out ("nuisance, negligence") and insert ("negligence, nuisance").
The LORD CHANCELLOR: My Lords, with the leave of the House, I beg to move that the House doth agree with the Commons in their Amendments Nos. 1 and 2 en bloc. The six Amendments with which we are concerned are all Government Amendments which are

725
intended to improve the drafting of the Bill, but which make no change of substance. The first Amendment to new Section 2A(6) of Clause 1 sets out in more detail the facts, knowledge of which determines the plaintiff's date of knowledge for the purpose of fixing the time from which the period of limitation runs. It removes a possible difficulty of interpretation in cases where it is alleged by the plaintiff that the defendant is vicariously liable for the act of somebody else. The second Amendment merely changes the order of the closing words of subsection (6) to correspond with the order used elsewhere in the Bill.
Moved, that this House doth agree with the Commons in the said Amendments.—(The Lord Chancellor.)
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, I think that both of these Amendments are acceptable. The second is a pure question of draftsmanship. The first is something which I must say I would not have thought of myself, but the noble and learned Lord has made it very plain and I think that it is a technical improvement.
On Question, Motion agreed to.
COMMONS AMENDMENTS
[Nos. 3 and 4]
Page 4, line 4, leave out from beginning to ("shall") in line 11 and insert—
("(2) Section 2B(3)(b) shall be applied separately to each of them, and if that would debar one or more of them, but not all, the court shall direct that any person who would be so debarred.")
Page 4, line 16, after ("of") insert ("section 22 of this Act (persons under disability) or").
The LORD CHANCELLOR: My Lords, with the leave of the House, I beg to move that this House doth agree with the Commons in their Amendments Nos. 3 and 4 en bloc. Subsection (2) of new Section 2C has been amended, both to simplify the drafting and to remove the risk that its provisions would operate unfairly in certain cases. It now has the effect, which was always intended, that in fatal accident cases the date of knowledge test should be applied to each of the defendants separately. The fourth Amendment, which follows the closing words of this subsection, is consequential on the previous Amendments. I beg to move.
Moved, That this House doth agree with the Commons in the said Amendments—(The Lord Chancellor.)
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, again this is a very highly technical matter, and I suppose we could spend a great deal of time on it. But the best thing is to say that there is no serious reason why we should not accept the Commons' view about this.
On Question, Motion agreed to.
COMMONS AMENDMENT
[No. 5]
Page 4, line 33, at end insert—
("If, for example, the person injured could at his death no longer maintain an action under the Fatal Accidents Act 1846 because of the time limit in Article 29 in Schedule 1 to the Carriage by Air Act 1961, the court has no power to direct that section 2B(2) shall not apply.").
The LORD CHANCELLOR: My Lords, Amendment No. 5 to new Section 2D(2) is intended to make clear the effect of this subsection, the purpose of which is to prevent the use of the court's discretion in cases which are governed by a special limitation code, like the Carriage by Air Act. Consultation which took place while the Bill was in progress showed that the intended effect of this subsection was not immediately apparent, and by this Amendment an example is added, I hope, to make its purpose more clear. My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 5.
Moved, That this House doth agree with the Commons in the said Amendment.—(The Lord Chancellor.)
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, again I do not think we need spend time on this. I am not sure that I am very enthusiastic about inserting "e.g.", as it were into, a Statute. It seems to me a questionable practice, but I do not think we ought to take time quarrelling with the noble and learned Lord about it.
The LORD CHANCELLOR: My Lords, with regard to what has just been said by the noble and learned Lord, it has been urged in the Renton Committee that the giving of examples in Acts of Parliament is indeed very helpful. It is a potentially dangerous precedent, because

727
the example may not be a very happy one. In this case I think that it is, and I hope that the House will approve of the practice, at any rate in this instance.
On Question, Motion agreed to.
COMMONS AMENDMENT
[No. 6.]
Page 7, line 6, leave out from ("force") to end of line 7 and insert ("on 1st Septembei 1975").
The LORD CHANCELLOR: Finally, my Lords, Amendment No. 6 brings this Bill into force on a fixed day; namely, 1st September, 1975. This Amendment enables me to express the appreciation and gratitude of the Government, and of myself personally, to noble Lords on all sides of this House and to Members of the Opposition in the other place, to whose co-operation and support we owe the fact that it will be possible to bring this Bill—which will greatly help plaintiffs who, in the past, have suffered great injury through the working of the limitation provisions of the law—into force, as I had hoped, in the forthcoming Long Vacation. It will be a great convenience both to the courts and to litigants that changes of the kind made in this Bill should take effect on a fixed day in a period when the higher courts, at least, are not regularly sitting, and when a substantial change of the law might otherwise present particular problems. With that expression of thanks, I beg to move that this House doth agree with the Commons in their Amendment No. 6.
Moved, That this House doth agree with the Commons in the said Amendment.—(The Lord Chancellor.)
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, I do not wish to be churlish, and I am indeed grateful for the thanks which the noble and learned Lord has given. It is a relief to find at least one Bill in this crowded programme with which I do not find myself in hearty disagreement. I agree with the noble and learned Lord that the Long Vacation is a good time to start a new law with regard to the limitation of actions. In thanking the noble and learned Lord for his gracious words, I am as gracious as my conscience allows me to be in the circumstances.
On Question, Motion agreed to.

INDUSTRY BILL
3.25 p.m.
The MINISTER of STATE. DEPARTMENT of INDUSTRY (LORD BESWICK): My Lords, I beg to move that the House do again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord Beswick.)
On Question, Motion agreed to.
House in Committee accordingly.
[The Earl of Listowel in the Chair.]
Clause 24 [Information for trade anions]:
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 191:
Page 23, line 7, leave out ("substantial").
The noble Lord said: I think it would be convenient for the Committee if we were to discuss with this Amendment. Amendments Nos. 195 and 196, which also propose the deletion of the word "substantial". We are at the Part of the Bill where we need to consider what constitutes a special reason which an advisory committee, as suggested by the Government, or an appeals body, as proposed by the Liberal Party, or by us from these Benches, could decide would make disclosure of certain information unwise. This is not information which is simply to be restricted to the Minister and to Government Departments only; it is information which the advisory committee may consider and decide can be issued to employees, when it is likely to become semi-public and to reach a competitor.
We believe that if it is clear that an injury would be caused to an undertaking, or to a number of the employees of the undertaking, that reason should be enough. It should not have to be a "substantial" injury. After all, if the advisory committee were to find that certain information if released would cause injury to a number of the employees of a company, surely the employees themselves would prefer to forgo that information, rather than lose their jobs or suffer some other setback as a result. Therefore, we earnestly ask the Government to look again at the drafting of this clause. As

729
the Bill now stands, the advisory committee will have to look at this clause and the preceding one for criteria against which to make its judgments; and the more helpful the Bill can be in providing criteria which are clear and cover a wide field, the better will the advisory committee be able to operate in the interests of everyone concerned.
I turn to the word "substantial" itself. I understand from lawyers that it has been shot to pieces in the legal world as being a word which can describe anything without any exactitude; indeed, it is often used when vagueness is required. I suggest to the noble Lord that it is unfair to this advisory committee or appeals body, if a different body is eventually decided upon, to give it the almost impossible task of deciding what "substantial" means in an individual case when considering the extent and magnitude of injury which has to be caused before saying that information should not be disclosed. Therefore, I ask the Government to look again at this important clause and eradicate something which will be vague and will cause difficulty for the advisory committee in a situation where, if injury would be caused by disclosure, it should surely advise against that. I beg to move.
Baroness HORNSBY-SMITH: I should like to support my noble friend in his Amendment. I think a very difficult situation arises where this information may be given to a non-employee of a company under the choice of the trade union delegate who may not be a member of the company but a district officer with no affinity to that company. As I understand it, there are many contracts in industry. I know from experience that company scientists and chemists are under contractual obligation not to disclose information This applies also in the contracts of employment of many others—and I think this has been defended in the courts—and even those without a specific contractual obligation are bound by the terms generally held in their employment not to disclose information to a competitor.
Ministers have repeatedly said that they hoped this information would be voluntarily supplied to the designated nominees whether or not they were employees of the company. But the company might find itself in a very strange position. If
730
that nominee entitled to receive the information was an employee of the company, there would be a legal comeback if that employee disclosed information which could harm the interests of the company. But, if the company voluntarily supplied information to a non-employee, then what redress would they have in law if that information was disclosed and gave rise to any injury? The situation might arise in which they would be alleged to have given the information voluntarily because they did not wait for the Minister to demand and compel them to give it. It is very unclear what redress they would have. I believe that to say, "substantial injury" makes the position even more confused and I fully sup port my noble friend in the difficult ramifications of the undertakings that have been given that injury should be injury whether it is substantial or otherwise.
3.33 p.m.
Lord MELCHETT: I think both sides of the Committee accept that there is a need for a balance to be struck between the interests of the undertaking and its employees and the need for disclosure. The Government have been much concerned with this balance, and paragraphs (b) and (c) of subsection 24(4) reflect changes made at an earlier stage in the Bill's progress. It may help noble Lords if I explain what the balance is that we seek, and why the Government believe the words "substantial injury" and "substantial numbers" are appropriate. These were not the words that first appeared in the Bill: it first spoke of "seriously prejudicial". These words follow paragraph 20 of the White Paper. In Committee in another place, there was strong criticism of the phrase "seriously prejudicial", which appeared in the Bill as first drafted.
Although "seriously prejudicial" has a precedent—and I glanced up to see whether the noble Lord, Lord Windlesham, was here, because I know that he always objects to our quoting precedents in the legislation of noble Lords opposite—in Section 158(1)(e) of the Industrial Relations Act 1971, we decided, on reflection, that this was too narrow a ground for safeguarding information. "Serious prejudice", we are advised, is a relative term, and damage of considerable size

731
could be incurred without seriously prejudicing a very large business concern. In addition, I am advised, serious prejudice to the undertaking would not cover employees' interests, but would be confined to the interests of shareholders. Because of these problems associated with "serious prejudice", the Government amended the Bill to refer to substantial injury, a measure which is not relative to the size of the business, and also amended it to make explicit provision to safeguard the interests of employees.
We are now being asked in these Amendments to refer only to "injury" and to "injury to a number of employees". This, we believe, would tilt the balance too far. If injury, without any qualification of the extent or seriousness of the injury, or of the number of employees involved, were to be the grounds for non-disclosure, it would be possible for any injury—however small, incidental or insignificant—to justify nondisclosure. This clearly goes too far, and the Government believe that the withholding of information should be based, in this subsection, on the grounds that it would substantially injure the undertaking's interests, or those of a substantial number of employees.
We must strike a balance here, and the Government believe the Amendments we have incorporated into the Bill strike the right one. The further Amendments would militate against disclosure to an unacceptable extent. They would also do something which I know that noble Lords opposite have been very taxed about in previous Amendments, which is that they would take us even further from the words which were originally in the White Paper and which noble Lords opposite, when they have been pressing some of their Amendments, have urged us to stick to as closely as possible. To answer the point raised by the noble Baroness, Lady Hornsby-Smith, if the company were disclosing information voluntarily, of course this provision in the Bill would not apply, but, in any case, they could tell whoever was concerned that some of the information was essentially damaging. I hope that answers the point she raised.
Baroness HORNSBY-SMITH: What is the position in law, as the man is not
732
an employee and as such would not have an implied contractual obligation? This is what concerns us. Will they in law have any redress if that information is disclosed?
Viscount MONCK: I fail to understand the argument of the noble Lord opposite. Do let us understand this! The manufacturing industry is the lifeblood of this country, especially exporting manufacturing industry. Anything which is asked to be disclosed which would injure in any way a manufacturing industry should be deprecated to the extreme. We then come to the word "substantial". As a previous speaker said, how do you define "substantial"? Is it more than 50 per cent. harmful, more than 40 per cent. harmful, or what? If the firm in question had to prove that disclosure would do "substantial injury", that firm would be put in a position in which it should never be put. I would respectfully and humbly like to support the Amendment moved by my noble friend.
The Earl of BALFOUR: I wonder whether I could put it a little more firmly? Subsection (4) on page 23 reads:
"For the purposes of this Act special reasons apply if the Minister considers… (c) that its disclosure would cause…"
and here I should like to see,
"any injury to any number of employees".
This is most sensitive. To say "substantial" in both cases could put the employees in a very difficult position. In other words as the wording stands it could upset the whole feeling of a works if, perhaps in some retraining organisation, a few of the employees felt that something was to happen to them in some way. I ask noble Lords opposite to consider this again. We are dealing with a very delicate situation and I should like to see the word, "substantial" left out altogether. I am certain that we need to treat this with great delicacy.
I think you will tend to drive employers into being secretive in their discussions with a Minister, and whenever a board of directors come to what seems a sensitive area they will meet not in the company's quarters but outside, perhaps in their own homes. You could get secrecy creeping in, which I am sure noble Lords on the other side do not want. I am glad that these Amendments have been put down by my noble friend Lord Campbell

733
of Croy. I feel that this is the sort of thing which could end up in serious strikes if something went wrong. We have too many strikes over just this sort of thing. I am certain that "substantial" numbers of employees is wrong.
Lord HEWLETT: I support what the noble Earl, Lord Balfour, and the noble Viscount, Lord Monck, have said. Rather than talk about this in abstract, may I say this? As a result of being rather successful in a particular enterprise, we obtained a very large share of the high impact resin market worldwide and, in particular, in this country. In 1963, we had the opportunity of persuading a very big American corporation to put very substantial, multi-million dollar investment into Grangemouth. Because we had the franchise for the sale of this product (which was developed not in the United Kingdom but in the USA) we were offered a share in that enterprise. Then the offer was withdrawn. Why? It was because of the fear of having to disclose information about the market share, about the success of the venture, about the technology and technical aspects of the product. So we had no capital share and Britain has lost several tens of thousands of dollars of investment income each year since 1963, because of those fears, the very fears we are discussing this afternoon.
Worse follows. We were still successful as a British company in selling this product, which earned good money for Britain in taxation terms, and in Grange-mouth every assistance was given by the local authority in the establishment of this enterprise. Then we were told, "No! You have the sole franchise for a multi-million dollar investment in which you have no share. Therefore, we cannot rely upon a foreign company controlling the outlet of a multi-million dollar investment. Sorry, you must give up the representation. You must form a joint selling company with us; and we want a majority holding for our security, because of all that has been said in Parliament about the possible nationalisation of the chemical industry, the disclosure of information, and so on."
The present situation is that that was further extended by pressure and it was not felt to be wise, in view of the projected legislation announced by the Labour Party, in its Party Conference,
734
that we should be a party to the sale at all. We had to sell our shareholding. Britain earns nothing; except that I happen to be chairman of the venture because I am still in touch with the industry over many year's service. Do noble Lords opposite appreciate what dynamite they are playing with? International confidence is at stake for British ventures that have spent a lifetime developing, as far as they can, the success of enterprises internationally. Let us not begrudge the fact that the Americans made the technical breakthrough in this acrylonitrile butadiene styrene terpolymer. It was a brilliant development on their part. They still have the largest share of world trade in this high impact resin. Britain's place is nil—snuffed out, because of the thought of Government interference and Parliamentary intervention in what is essentially a commercial and industrial matter; unwarrantable interference, I would say, in an otherwise very successful venture in which Britain could have prospered. Let us take a little more care and listen to the voice of someone who has been directly involved for over 25 years in a highly complex industry where we cannot afford to fool about like this.
Lord MELCHETT: May I put a question to the noble Lord before he sits down? Did he say that there had been interference by this Government in this venture and that that is why it failed? I think he did say that.
Lord HEWLETT: It was the threat of interference, the fear of interference and the fact that one might have to disclose, as this Bill proposes, a great deal of information which the American company felt was private to itself. I am not talking about tax returns; I am talking about having to disclose share of the market, proportion of investment and so on. Even the Companies Bill, which was enacted by the previous Labour Government, forced more disclosure out of industry than was perhaps prudent in the interests of the employees and the shareholders. We are not playing a game! Some of us have a livelihood in this field. We do not talk about the matter; we have to work at it.
Lord WIGODER: On the immediate issue of whether it should be "injury" or "substantial injury", might I ask the

735
noble Lord, Lord Melchett, this? Is it not right that any tribunal considering the word "injury" would apply the de minimus rule, so that if the injury was a wholly trivial one the tribunal would be entitled to say that it did not amount to injury for the purpose of this section of the Bill? If that is right, does not the word "injury" by itself provide a perfectly adequate safeguard without the wholly imprecise and woolly word "substantial" added to it?
Lord BRUCE of DONINGTON: May I suggest that noble Lords opposite appear to be making heavy weather of this part of the clause? This clause is restricted to those cases where Clause 23 applies. I should like noble Lords to look at Clause 23(2) and the various items listed there from (a) to (k). I invite them to say where they consider the disclosure of information comprised under any of those heads is likely to injure, let alone substantially injure any company. It is all very well to have a general suspicion about this; I can understand that. But if there are substantial suspicions, (to use again the word "substantial") I think noble Lords opposite ought to be able to specify the subhead under which their prinicipal anxieties lie. Certainly, the information required in Clause 23 has no bearing on the information that the noble Lord, Lord Hewitt, feared would be supplied to competitor companies. Clause 23 is restrictive. I should not have thought it would present noble Lords opposite with any particular difficulties.
The Earl of BALFOUR: I cannot agree with the noble Lord who has just sat down. I would refer him to Clause 23(2)(k) "expenditure on any research or development programme". I think that the exemaple given by the noble Lord, Lord Hewlett, has been perfect and has hit the nail on the head.
Lord BRUCE of DONINGTON: To reply on that point, subsection (2)(k) does not require that details of the research should be disclosed: it does not require that full details of the development should be disclosed. All it does is to indicate the expenditure. It is a figure that is being disclosed; it is not technical know-how. I ask noble Lords to counsel themselves on this. It is common knowledge
736
that in the USA and in Germany the amount of information supplied both to those responsible for assessing the economic situation of the country and to the trade unions is vastly in excess of anything set out in Clause 23 of this Bill. I do not understand their anxiety. They are making heavy weather of it. They must be becoming intoxicated by the extravagant propaganda that was put out prior to the Bill's being published: and it was put out by their own Press.
Lord DRUMALBYN: Perhaps the noble Lord, Lord Melchett, would be willing to confirm or reject what his noble friend has said. His noble friend said that only a figure is required in regard to research and development. A firm may be going in for a lot of research and development. Is it only a figure for the whole lot? It is very important.
Lord HEWLETT: Before the noble Lord replies, may I say that I resent the implication that I have been subjected to propaganda. I have addressed your Lordships on the basis of the fact that I have had 25 years' experience in the chemical industry. I would ask the noble Lord to withdraw and, when he does so, to call me Lord Hewlett and not Lord Hewitt.
Lord MELCHETT: Before my noble friend has a chance to withdraw, may I agree with him in what he said to the noble Lord, Lord Hewlett. The noble Lord said that this deal—which he told us about at great length—was called off on the basis of threats from the Labour Party and remarks which had been made at the Labour Party Conference. I recognise that he has great experience in industrial matters and I bow to his experience in that field.
May I suggest to him that instead of acting on the supposed threats and, as my noble friend says, the overwhelming amount of misleading propaganda which preceded this Bill's progress through Parliament, he might have waited and acted on experience of the Bill when it becomes an Act. Then he would be doing us the courtesy which he is asking us to give to him; that is, to look to his experience. If he had waited to see how the Bill turned out in practice and, indeed, what Bill is passed on to the Statute Book after it has been amended

737
by both Houses of Parliament, he might well have not needed to call off his deal or suffered what I am afraid I consider to be the exaggerated fears from which he is suffering. I have several points to answer which have been raised on the substantive Amendment—
Lord HEWLETT: With respect to the noble Lord the Minister, I am not suggesting the present legislation is affecting 1963. I have told a story which began in the early 'sixties when I persuaded an American corporation to come to Grange-mouth rather than go to Amsterdam, Brussels or elsewhere. I have referred to a continuing story covering the past 12 years. I am saying the concept of what is put in the Bill in this clause we are discussing is precisely the attitude which has been reflected over the past 12 years by the Government Party. I cannot quote instances of the results of the fear caused by this clause: this measure is not even an Act yet. It is the concept of constant interference, constant inquiry, busy-bodying in industries in which the Government have made almost no contribution whatever—and I hope they will not because it is a very successful industry at the moment—that I am trying to press on the Minister.
Lord ROBBINS: Before the noble Lord replies—
Lord MELCHETT: I was in the middle of replying, with great respect noble Lord, Lord Robbins. No doubt he will leap to his feet as soon as I finish. I was in the middle of my reply and gave way to an intervention by the noble Lord, Lord Hewlett. Maybe we can return from matters in 1962 to the substance of the Amendment which we are discussing. We recognise the powers we are discussing in these three Amendments could he used in some circumstances to require disclosure when they result in some injury to the undertaking, or some injury to some employees. We are not denying that is the case. There may be circumstances, in our view, in which this is justified: where the gains from disclosing information outweigh the injury that that information might cause. Those of us who believe in the benefits which will accrue from the wider sharing of information must and do recognise that these benefits are sometimes bought at some cost. But here the
738
discretion afforded to the Secretary of State by the words:
"…the Minister may serve"
in Clause 24(1) will be of great use. The Minister will be able to consider the value of information to the firm's workforce and the prospect of its occasioning some, albeit slight, injury to the business or its employees. If the Minister decides that the harm, although not enough to constitute substantial injury, will be sufficient to outweigh the advantages of disclosure, the Minister can exercise his discretion to protect the business or its workers.
In response to the intervention by the noble Lord, Lord Wigoder, I hesitate to take issue with him on a legal point, but I am advised by our legal advisers that the de minimis rule would not apply in this case. It would be possible, to take up points which were referred to by the noble Earl and others, in an undertaking where there were 200,000 employees, for the disclosure of information to those employees to be of great benefit to them and the efficiency of the company. It may be that it would disclose to employees certain areas of overmanning, and if these areas of overmanning were not dealt with the firm would not be able to maintain profitability. It may be that that 2,001st employee would be badly injured by the disclosure of information. I am taking an extreme example. I dare say that whether or not the de minimis rule applies, people will be sensible about it. It is possible for a small number of employees to be harmed by information which will be of great benefit to industrial efficiency and productivity, in the interests of the employees and the commercial interests of the shareholders and the firm. It is this benefit from the disclosure of information, which we do not want to be limited, which we believe will be severely limited if we accept the Amendments moved by the noble Lord, Lord Campbell of Croy.
3.56 p.m.
Lord ROBBINS: I have great sympathy with what has been said by the noble Lord, Lord Bruce of Donington, regarding the attitude of industry in general in this country concerning the disclosure of information as compared with the disclosure which takes place in other parts of the world. I am in complete sympathy with that general attitude. But.

739
at this moment, we are considering the minute drafting of a Bill, and I suggest to the noble Lord, Lord Melchett, that the Secretary of State and the Government generally, of whatever Party, is likely to get into more trouble with the interpretation of the word "substantial" than they would if they left it out. I do not understand the quantitative significance in economic life of the word "substantial". Supposing there is some disclosure of information made by a monster firm—Imperial Chemical Industries—one could easily say they could take that in their stride. On the other hand, supposing it is a small firm which is just starting up, and which has a good idea regarding know-how and, for some reason or other, it is brought in under this rubric. In those circumstances, the damage may be very substantial—using the word "substantial" in the common-sense use of it. I cannot think of any legal way of making this concept precise. I prefer to leave it to the courts to interpret as the noble Lord, Lord Wigoder, said the term "injury" according to the de de minimis rule or something else, rather than encumber this legislation with this superfluous adjective.
Lord MELCHETT: With great respect to the noble Lord, Lord Robbins, it may well be that whoever interprets the provisions in these subsections will have a great deal more difficulty in deciding what is injury and what is not, and whether or not injury to one or two employees should be taken into account. I said earlier that the wording "seriously prejudicial", which was originally in the Bill, was open to the objection which he has raised. Something which was seriously prejudicial to a large company could result in great damage before it seriously prejudiced the company. But we are advised that the term, "substantial injury" is not open to that objection. Something which substantially injures the employees in a large company would not be related to the size of the undertaking; it would be related to the amount of damage. I think the noble Lord's point on that was not valid.
The word "substantial" is obviously causing some noble Lords difficulty because it is not further defined. I know the noble Lord. Lord Hewlett, did not approve of the Companies Act 1967, but
740
it is a word which is already used in that Act in Section 16(1)(a) as well as in a number of other Acts. In the Companies Act it requires the directors' report to contain certain information about changes in fixed assets if the market value of those assets differs substantially from the amount at which they were shown in the last balance sheet. I am not aware that the use of the word "substantial" in that Act causes any problems. Possibly the fears of noble Lords on this point are slightly exaggerated.
Lord CAMPBELL of CROY: The noble Lord reminded us that the words "seriously prejudicial" had originally appeared in this Bill, and I would agree with him that in this context those words are worse than the words with which the Government replaced them. But that is not what we are considering. We are now considering the qualification, in three places in these two paragraphs, with the word "substantial". Why qualify at all? Let me just read paragraph (c):
"that its disclosure would cause substantial injury to a substantial number of employees of the undertaking".
Surely it is enough that disclosure would cause injury to a number of employees in an undertaking. Even the example which the noble Lord, Lord Melchett, gave of one would not apply under this Bill, because it has to be a number.
I referred in passing, not myself being a lawyer, to what I had been informed about the legal difficulties of defining the word "substantial". During the debate we had the contribution of the noble Lord, Lord Wigoder, who is a lawyer, and who gave us his opinion that in the interpretation by the advisory committee of causing injury there would be a de minimis consideration.
Lord MELCHETT: But—
Lord CAMPBELL of CROY: May I just complete this point and then I will give way. I understand what the noble Lord. Lord Melchett, said about the possibility of some completely insignificant pinprick appearing technically to qualify under this provision. But I do not think that the drafting of this Bill, and the guidance to the advisory committee, should be based simply on that concept of some minute and almost invisible pinprick which might then activate this part of the Bill. Now I give way.
Lord MELCHETT: I just wanted to say something about the de minimis provisions which were mentioned by the noble Lord, Lord Wigoder. I said that my legal advice was in conflict with what the noble Lord, Lord Wigoder, said, and he did not rise to contradict my legal advice. I assumed he had accepted what I said. At least, it was not contradicted until the noble Lord, Lord Campbell of Croy, prayed it in aid in his arguments. It would be better to clear up at least that there is a direct conflict of opinion on this matter, or that my legal advice has been accepted by the Committee.
Lord WIGODER: I do not know whether the noble Lord, Lord Campbell of Croy, will forgive me if I intervene in the middle of his intervention, after the intervention of the noble Lord, Lord Melchett. I was raising the issue of whether the de minimis principle would apply, and was suggesting that any tribunal which was considering whether or not there was an injury would be entitled, whether or not the principle as a matter of law applies, to say to itself, "This is a matter so trivial that it does not constitute an injury within the terms of the section".
Lord CAMPBELL of CROY: Not being a lawyer, it was no surprise to me that there should have been a difference of opinion among lawyers on this point. The main point was that the noble Lord, Lord Wigoder, brought to our attention the doubt there could be about the anxiety of the Government concerning what I would describe as the insignificant pinprick. In order to meet that particular pinprick case, it seems unsatisfactory that the guidance to this advisory committee should then have this very vague adjective, which I think noble Lords on all sides of the Committee have agreed would make it exceedingly difficult for them to interpret this part of the Bill. The effect of putting in the word "substantial" in these three places is to pass the buck to the advisory committee. It leaves them with an exceedingly difficult task.
This brings me to asking the Government whether there will be official guidance to the advisory committee in addition to this Bill. So far as we know, it is simply this clause of the Bill to
742
which the advisory committee will be looking for guidance as to how they should carry out their judgments as regards particular information which is put before them. My noble friends who have spoken have expressed themselves quite clearly as being against the inclusion of the word "substantial" in these places, and I hope that the Government will say they will look at this point again. I recognise that this is not an easy drafting matter, and the discussions held in another place indicated this. The noble Lord, Lord Bruce of Donington, referred to the list in Clause 23 of subject matter on which information can be required by the Minister for passing on to trade union representatives. But on Friday we had debates which indicated that some of the information under these headings could be highly sensitive, and indeed cause considerable damage to companies—I do not want to go over those debates again; they are in Hansard. So I would contest what the noble Lord said about that. I hope that the Government will be prepared to reconsider this matter and, in the light of everything that has been said during this brief debate on a very important matter, will still say they are ready to consider the redrafting.
Lord DRUMALBYN: Before the noble Lord opposite finally rises to say that he is going to consider the Amendment, which I feel certain he must do, would he at least consider this point? The noble Lord, Lord Robbins, has put cogently that "substantial" means "substantial" and is not related to the size of the undertaking concerned. It is the same. It must be substantial. There is nothing proportionate about it; it must be substantial. I should have thought it is unwise for noble Lords opposite to stand and be obstinate about an Amendment like this. There are words that can be used—"significant", for example. May I have the noble Lord's attention, because I am making a suggestion? Order! I am making suggestions to the noble Lord. There are other words that can be used. "Significant" is a word: "appreciable" is a word sometimes used. I have had a lot of experience of this matter on the Government side, and I am sure that the noble Lord, Lord Beswick, would agree that "substantial" means "a lot". It does not mean

743
"appreciable" or "significant"; it means "a lot". And that is what we object to.
Lord BESWICK: I am asked a straight question, whether we will consider this point, and I answer that we will consider it. But I am bound to say that if we consider it we shall in all probability come back to the word "substantial". I am almost tempted to repeat what the noble Lord, Lord Drumalbyn, said. I was in fact listening to the noble Lord, Lord Drumalbyn, at the time he made the remark I refer to, because what was going through my mind was this. No matter what word we put here—whether it is "significant", "appreciable", "a lot—we are always going to have argument about it.
The noble Lord, Lord Campbell of Croy, asked whether any guidance is going to be given to the advisory committee. Of course not on this particular point, because, obviously, the Committee must make up their own mind in relation to the facts. When the noble Lord, Lord Wigoder, was telling us about the working of the de minimis rule, what he was really saying was that a court of law would apply that rule if in its opinion the damage or the injury was not substantial. One has to decide at what point the injury was de minimis and at what point it becomes significant, substantial or appreciable. A certain amount of discretion in this connection is, I should have thought, essential. Although I undertake to ensure that what has been said is considered, I still have to record my doubts that there is any word in the dictionary that would not give rise to questions. However, I give the assurance.
Lord CAMPBELL of CROY: I am afraid I do not regard the assurance that was given as something on which noble Lords can base very much hope. The noble Lord, Lord Beswick, was quite frank in saying that at present the Government had no intention of changing the word; they would look at it again but they would probably come back with the same word, "substantial".
Lord BESWICK: I did not say, "no intention". I said I just could not see any other word or way of satisfactorily settling all doubts.
Lord HEWLETT: A substantial intention, perhaps?
Lord CAMPBELL of CROY: I hope that the noble Lord, Lord Beswick, will forgive me for not getting his words correctly. I was trying to repeat what he said. But he was quite frank in telling us that he could not at present see another way of dealing with this point. I and my noble friends feel that it would be much better to remove the word "substantial" and give the Government an opportunity of thinking of another word to insert at a later stage. We have had the benefit of legal advice from the noble Lord, Lord Wigoder. I know that it is apparently contested by legal advice elsewhere, but I certainly feel fortified in sticking to my guns on this question.
4.10 p.m.
On Question, Whether the said Amendment (No. 191) shall be agreed to?
Their Lordships divided: Contents, 96; Not-Contents, 69.

CONTENTS

Aberdare, L.

Boyle of Handsworth, L.

Elles, B.

Airedale, L.

Byers, L.

Elliot of Harwood, B.

Allerton, L.

Campbell of Croy, L.

Elton, L.

Alport, L.

Carrington, L.

Emmet of Amberley, B.

Amulree, L.

Cathcart, E.

Glasgow, E.

Arran, E.

Clifford of Chudleigh, L.

Glenkinglas, L.

Ashbourne, L.

Cottesloe, L.

Grenfell, L.

Atholl, D.

Cowley, E.

Grey of Naunton, L.

Balfour, E.

Cullen of Ashbourne, L.

Gridley, L.

Balfour of Inchrye, L.

Daventry, V.

Grimston of Westbury, L.

Balniel, L.

Denham, L. [Teller.]

Hailsham of Saint Marylebone, L.

Barnby, L.

Deramore, L.

Beaumont of Whitley, L.

Derwent, L.

Hereford, V.

Belstead, L.

Drumalbyn, L.

Hewlett, L.

Berkeley, B.

Dudley, B.

Hornsby-Smith, B.

Bessborough, E.

Dundee, E.

Hylton-Foster, B.

Bledisloe, V.

Ebbisham, L.

Ironside, L.

Boothby, L.

Effingham, E.

Kings Norton, L.

Kinloss, Ly

Onslow, E.

Sudeley, L.

Long, V.

Porritt, L.

Swaythling, L.

Lothian, M.

Rankeillour, L.

Tenby, V.

Loudoun, C.

Rathcavan, L.

Terrington, L.

Lovat, L.

Robbins, L.

Thomas, L.

Lyell, L.

Rochester, L.

Vickers, B.

Macleod of Borve, B.

Sackville, L.

Vivian, L.

Merrivale, L.

St Aldwyn, E.

Wade, L.

Milne, L.

St Davids, V.

Wakefield of Kendal, L.

Monck, V.

St. Helens, L.

Ward of North Tyneside, B.

Mowbray and Stourton, L. [Teller.]

Sandys, L.

Ward of Witley, V.

Seebohm, L.

Wigoder, L.

Northchurch, B.

Sempill, Ly

Wise, L.

Ogmore, L.

Somers, L.

Young, B.

O'Neill of the Maine, L.

Strange, L.

NOT-CONTENTS

Ardwick, L.

Douglass of Cleveland, L.

Mais, L.

Bacon, B.

Elwyn Jones, L. (L. Chancellor.)

Melchett, L.

Balogh, L.

Paget of Northampton, L.

Beswick, L.

Feather, L.

Pannell, L.

Birdwood, L.

Gaitskell, B.

Platt, L.

Blyton, L.

Gardiner, L.

Popplewell, L.

Bowden, L.

Gordon-Walker, L.

Rhodes, L.

Brockway, L.

Goronwy-Roberts, L.

Ritchie-Calder, L.

Brown, L.

Hale, L.

Royle, L.

Bruce of Donington, L.

Harris of Greenwich, L.

Rusholme, L.

Buckinghamshire, E.

Henderson, L.

Slater, L.

Burntwood, L.

Houghton of Sowerby, L.

Stedman, B.

Burton of Coventry, B.

Hughes, L.

Stewart of Alvechurch, B.

Castle, L.

Jacques, L.

Strabolgi, L. [Teller.]

Champion, L.

Janner, L.

Summerskill, B.

Chorley, L.

Kilbracken, L.

Taylor of Mansfield, L.

Collison, L.

Kissin, L.

Wallace of Coslany, L.

Cooper of Stockton Heath, L.

Leatherland, L.

Wells-Pestell, L. [Teller.]

Crook, L.

Lee of Newton, L.

White, B.

Darling of Hillsbrough, L.

Llewelyn-Davies of Hastoe, B.

Wilson of Radcliffe, L.

Darwen, L.

Lloyd of Hampstead, L.

Winterbottom, L.

Delacourt-Smith of Alteryn, B.

Lovell-Davis, L.

Wootton of Abinger, B.

Donaldson of Kingsbridge, L.

McLeavy, L.

Wynne-Jones, L.

Douglas of Barloch, L.

On Question, Amendment agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
4.19 p.m.
Lord CULLEN of ASHBOURNE Lord CULLEN of ASHBOURNE moved Amendment No. 192:
Page 23, line 8, leave out ("the") and insert ("any").
The noble Lord said: The purpose of this Amendment is to draw attention to something which seems to me to be potentially dangerous. It could well be that information is disclosed to a Minister which is neither received in confidence for another person nor would cause injury to the undertaking or to its employees, but could cause injury to another undertaking. I think that this could happen with commercial information, but I am particularly exercised in respect of financial information. If, for instance, company A disclosed to the Minister that it was experiencing serious cash flow problems because another company, company B, was being very slow
746
in paying for deliveries and that information was generally disclosed, it would be damaging to the creditworthiness of company B, especially if that information was taken in isolation, which it probably would be. Alternatively, if company C disclosed that it was negotiating for the purchase of an asset from company D which was in a very serious financial state, for that information to get out would be serious and if later it was learned that negotiations had broken down it could be fatal to company D.
As the noble Lord, Lord Houghton of Sowerby, said on Second Reading, under all Governments of recent times there has been suspicion between industry and Government. There can be little doubt that this feeling would be accentuated if an undertaking were compelled by the Minister to disclose information that caused injury to another undertaking. I think it is important that account is taken of this potential danger. I do not

747
suggest that the simple Amendment that I have tabled is necessarily the answer, but I urge the Government to give thought to this matter before the next stage of the Bill. I beg to move.
Baroness WARD of NORTH TYNESIDE: I wish to support the Amendment moved by my noble friend. The alteration of one word for another seems a very small amendment, but it is important that the right word should be embodied in the Bill. I should like to have an undertaking now because, if I may say so, we seem to be deciding to reconstitute the whole Bill with the number of agreements to the points that have been put forward from this side of the Committee. I like to have definite action. I have been brought up in another place where people seem to be more definite than in the place in which I now find myself. Doubtless I shall learn in time.
Lord LOVELL-DAVIS: I should like to clear up one point raised by the noble Lord, Lord Cullen of Ashbourne. He is concerned about financial information.
Baroness WARD of NORTH TYNESIDE: That is very important.
Lord LOVELL-DAVIS: I am not disputing the fact that it is important. The list of subjects on which information can be required does not include financial information, and there is nothing which would lead people to suspect that a business was in difficult financial straits. I take the main point, however, that the noble Lord is making, which is that the interests of third parties should be protected. The Government considered how best to do this. Broadly, there is a choice between the approach adopted in this Amendment, and a reliance on the proper exercise of Ministerial responsibility and discretion. The Amendment proposed here would hardly be adequate in itself: if a statutory reference is to be made to third party interests, it would also be logical to follow this through with subsequent rights for third parties who believe they may be affected to make representations to the Minister. This would be complex, and add very considerably to what are already difficult provisions to follow.
The Government have instead favoured the use of Ministerial discretion. Indeed, the possibility of using the Minister's dis-
748
cretion to protect the interests of third parties was one of the reasons for changing the absolute duty placed upon the Minister to require all information he received to be passed to trade union representatives to the present discretion, by which he may require it to be so furnished. If a company believed that information it was asked to provide would be damaging not to it but to another company, it would be able to bring this to the Minister's attention when submitting the information to him. When examining the information, the Minister would then—either on the advice of the company or quite independently—come to a view on whether information would be damaging to third parties, and, if so, exercise his discretion not to require that information to be passed to trade union representatives. This course has the advantage of simplicity. I can assure noble Lords that we are fully conscious of the need to protect third parties, and that we believe the Bill, as it stands, will allow this to be done.
Lord CAMPBELL of CROY: If I may comment at this point, the noble Lord has indicated that financial information would not be involved. But, unless the Government could guarantee that it would not arise, surely there is a situation where information under Clause 23 could be furnished by company A which could cause damage to company B or C if it were disclosed. What the noble Lord has just said appears to accept that that situation could arise. He is saying that this must be dealt with by Ministerial administrative arrangements. But he also said—and this is what I want to query immediately—that, when company A submitted its information, it could draw attention to the fact that damage might be done to company B, but company A might not know that the disclosure of information will damage another company. It is placing a burden on company A to know that the later disclosure of information might damage third parties. They cannot be omniscient in these matters and they could well not know that the disclosure of the information at a later stage could damage another company.
So I think there is immediately a defect in what the noble Lord has just said on that point. If company A does know this and can be quite certain that all

749
possible injury to other companies is covered in its submission to the Minister, what he is saying is one solution, although not as satisfactory, I believe, as has been suggested by my noble friend Lord Cullen. But he has not dealt with the situation where a company does not know, and what he is saying appears to place yet another burden on the company to be aware, and to inform the Minister, of any possible injury to third parties.
Lord SLATER: Would it be asking too much of the noble Lord to ask what conclusion he has arrived at as to the likeliest person or persons who would disclose such information if they were attached to these respective companies, which would involve these two parties? Has he given any thought to that? What it amounts to is that there is a form of mistrust against the boards that may be set up when they are operating and find themselves in this difficult position. I think the noble Lord should address himself to that.
Lord CAMPBELL of CROY: If I may just deal with that point, I do not think the noble Lord, Lord Slater, has entirely understood the situation. What happens under the Bill as at present drafted is that a company can draw attention to some information which it believes ought not to become semi-public, because at the end of the compulsory disclosure system the information becomes semi-public and can no longer be regarded as confidential. But the company may well say that, so far as the company is concerned, certain information could be disclosed and would be in no way damaging to the company. But what it might not know is that, if that information became public, it might damage another company. It is not a person leaking information; it is the acceptance at the end of this procedure that the information is public.
Lord LOVELL-DAVIS: I find it difficult to imagine the situation that the noble Lord, Lord Campbell of Croy, has adduced. I find it hard to think of a situation where a company would not know that it was damaging other companies. I find it even more difficult to conceive of a situation where this matter is under consideration by the Minister and everyone involved, and a company is damaged and nobody realises it until the damage has been caused. I find it
750
difficult to explain this situation. I said that this is one way a company would be able to say that the disclosure would damage another company; but it is not the only way this will come to light. Under general consideration of a matter of this importance, I should have thought it would become clear if there was a possibility of a third party being damaged. I come back to the main point, which is that we feel the Bill as it stands adequately protects third parties through Ministerial discretion. On that account, I would ask the noble Lord and the noble Baroness who have put their names to this Amendment to consider withdrawing it.
Lord CULLEN of ASHBOURNE: I am grateful to the noble Lord, Lord Lovell-Davis, for that reply; but the whole purpose of the Amendment was not because I thought that altering one word for another would make all the difference, but because I thought there is a possibility of things going wrong. The person putting it wrongly will be the Minister. It is the Government who want this Industry Bill to work properly. All I was trying to do was to point out something which could go wrong—of course, many things can, but there is that one particular thing that I can see, beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
4.30 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 193:
Page 23, line 8, after ("undertaking") insert ("or one or more of its subsidiaries")
The noble Lord said: I think it would be convenient if Amendment No. 197, which is similar, were discussed with this Amendment, which I now move. I believe that in this Bill it is important not to overlook subsidiaries. For example, a large holding company might not itself technically suffer injury as a result of disclosure of information, but a subsidiary might suffer considerably, or be in danger of being put out of business because of some special process being made public and reaching the hands of competitors. How do the Government explain this? Can the Government convince us that a subsidiary is covered in the Bill? Or do they agree that something ought to be put in to ensure that subsidiaries, as

751
elsewhere in the Bill, are dealt with like the companies?
Lord LOVELL-DAVIS: Here again, I recognise the point that these Amendments seek to make, which is one that the Government considered thoroughly. I should like to explain carefully why, after consideration, we believe the Bill should remain unamended. In doing so, I find it hard to conceive of the sort of case the noble Lord, Lord Campbell of Croy, is talking about. It seems to me that the situation envisaged by the Amendment is not one which is very likely. One would have to postulate two businesses, one run by a company and the other by one of its subsidiaries. Business A is asked to provide information, and there is no question of harm arising to business A or to its employees, but somehow information disclosure would prove harmful to business B or to its employees. I find this very difficult to accept. I think it is rather far-fetched to postulate that situation.
But there is a more serious reason for this. We are here considering a case, albeit a special one, of the general problem of how to protect third parties. In the example I postulated, undertaking B is in the same position as any third party in respect of the undertaking required to furnish information; it merely happens to share common ownership. We have considered how third parties may be protected. This can best be dealt with by the Minister exercising his discretion as to when information should be disclosed to trade union representatives. This is a flexible and practical way of dealing with what otherwise might be a cumbrous problem.
It is our intention, therefore, that protection for all third parties should be given in this way and we see no reason to make special provision for businesses carried on by the same company as that which has to furnish information. I have endeavoured to set out the arguments further, so that noble Lords who support the Amendment can see why we have decided not to recommmend acceptance. The principle of safeguarding third party interest is not at stake, and we accept that. Rather we are concerned how this should be done. We believe the change from a Ministerial duty to a Ministerial discretion in Clause 24(1) affords a simple
752
and proper way of achieving what I believe to be a common objective of all noble Lords.
The Earl of ONSLOW: There is one small point which I wish to bring to the attention of your Lordships. Both on this Amendment and on the previous one, the noble Lord, Lord Lovell-Davis, said that he found it extremely hard to conceive of circumstances which could arise because of the objections quoted by the noble Lord, Lord Campbell of Croy. The point I am making here is that there have been so many examples in history of people failing to see the objections beforehand, and the objections happening. I am quite convinced that the French General Staff said they totally failed to see the possibility of the Germans going through the Ardennes in 1940. This may be far away from the Bill, but that the Minister concerned cannot see the possibilities is an extremely bad argument to put forward. That is the point to which I would draw the attention of your Lordships.
Lord LOVELL-DAVIS: If the noble Earl. Lord Onslow, can give the Committee an example, then we shall be in a much better position to consider it. I have thought long and hard about this, and cannot find an example which will stand up. While I am on my feet, I should like to mention something that has been referred to many times since the beginning of the Committee stage of this Bill. The noble Lord, Lord Campbell of Croy, said that he was concerned about the publication of a process of a subsidiary. Clause 23(5) makes it clear that no know-how can be covered by disclosure under these powers. This has been said many times, and that is by the way. I can only rest my case on the fact that I find it almost impossible to conceive of the situation being created for which this Amendment is plainly designed. I feel the discretion of the Minister to cover third parties is adequate.
Lord CAMPBELL of CROY: This is a matter of drafting, and of getting this important section right, because this is the part of the Bill which gives guidance to the advisory committee who have to take these important decisions. The noble Lord appears to agree with our view that damage, or possible injury, to a subsidiary company should be included as affecting

753
the company itself. When I moved this Amendment I pointed out that we are trying to make sure that this part of the Bill covers the technical position where the company itself may not stand to suffer injury, although a subsidiary would. The noble Lord is quite clear in his answer that he has the same aim. We must make sure the guidance set out for the advisory committee is clear and beyond dispute.
The reply of the noble Lord, Lord Lovell-Davis, in effect is that Ministerial discretion will govern that, and it is not necessary to write subsidiaries into the Bill. At this stage I am prepared to accept that, because he recognises there is no difference between us on the object to be achieved. But we have to be satisfied with the provisions of the Bill which are to be the criteria to be used by this advisory committee. We must make sure that they are right, not only technically but also in a common sense way, so that the advisory committee are not put into what could be a silly position, by considering only one company and not the position of subsidiaries. In view of what the noble Lord has said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord CAMPBELL of CROY: I beg to move Amendment No. 195, which has already been discussed with Amendment No. 191. As your Lordships decided to accept Amendment No. 191, I shall move this one formally.
Amendment moved—
Page 23, line 9, leave out ("substantial").—(Lord Campbell of Croy.)
4.40 p.m.
Lord CAMPBELL of CROY: I beg to move Amendment No. 196.
Amendment moved—
Page 23, line 10, leave out ("substantial").—(Lord Campbell of Croy.)
Lord MELCHETT: I have no doubt that many of your Lordships feel that you already voted on the substance of this Amendment when you voted on No. 191, but it covers a slightly different point. I am still advised that if we put into the Bill the words "a number of employees" this can mean any number from one upwards. In our view, this Amendment, taken with Nos. 191
754
and 195, will leave this subsection substantially useless. I would ask the noble Lord, Lord Campbell of Croy, before he presses his temporary victory, at least to consider that point.
Lord CAMPBELL of CROY: To show that I certainly do not wish to press anything to which the Government feel they can give further consideration, I will not press this one. I beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 198:
Page 23, line 10, at end insert—
("( ) that the information is of a commercial nature which would be of value to the undertakings' competitors;
( ) that this disclosure of the information would infringe the contractual rights or duties of the undertaking or any of its subsidiaries or the contractual rights of third parties or would render the undertaking or any of its subsidiaries in any way liable, in damages at law;").
The noble Lord said: This Amendment, which I now beg to move, would introduce two paragraphs into this Part of the Bill, the provisions against which the advisory committee are to take their decisions. The first paragraph, "that the information is of a commercial nature which would be of value to the undertakings' competitors", I have taken from the wording used by a member of the Government in reply to a Question in another place on 9th June, just over six weeks ago. The question was asked: whether the Government would make a Statement about the criteria adopted in excluding confidential information in the Ryder Report on British Leyland. In reply to that the Minister stated:
"The information that has been excluded from the Ryder Report is of a commercial nature which would be of value to British Leyland's competitors."—[Official Report, Commons, 9/6/75; c. 1.]
That example seemed to be a good reason for information of this kind not being disclosed, and we felt that it should be among the special reasons in this Part of the Bill which the advisory committee would take into account.
I now come to the second paragraph, which deals with contractual rights and liabilities, and here, again, we believe that the special reasons to be placed in this Bill should include the question of

755
contractual rights and liabilities. To give an example, a customer or another person affected by the disclosure of information about a company might bring a claim, it the release of that information when it becomes public reaches competitors and then breaches an agreement or causes injury to him, not necessarily to the company itself but to this third party. We believe that something should be inserted to cover this kind of reason for not disclosing information. The special reasons at present contained in subsection (4) of this clause appear to be too narrow, and your Lordships will notice that in the following two Amendments we are also suggesting other matters that should be taken into account by the advisory committee. I beg to move.
Lord BESWICK: The noble Lord, Lord Campbell, has moved his Amendment with commendable brevity, and I will try to respond and answer similarly. May I take first the point about value to competitors? I will tell the noble Lord why it was thought inadvisable to give that information in the Ryder Report. It was, as he rightly said—and it was said in the Statement—because it would be of value to competitors and in so doing would cause injury, or substantial injury, as we thought, to British Leyland. Already one of the reasons for nondisclosure is, or was, substantial injury; it is now injury. If information which is of value or interest to competitors is not of damage to the company, then it does not really matter. It may be of some value and of some interest, but it does not cause damage to the first company and, therefore, as I say, the difficulty would not arise. If it did cause injury, then it is caught by the earlier part of the subsection. I hope that that is sufficient for the noble Lord on the first of his proposed new provisions.
So far as the second one is concerned, where he says that it should not be disclosed if it "would infringe the contractual rights or duties of the undertaking… or would render the undertaking or any of its subsidiaries in any way liable, in damages at law", I do not believe this could arise. The company required to disclose information by law, whether to the Government or to its workers, could not be successfully sued for damages, because it was required by
756
law to provide that information. That is sufficient defence. If it were shown that the company was required by law to disclose the information, this would be a complete defence. There is, therefore no need for this provision. I hope that with that explanation the noble Lord will feel able to withdraw his Amendment.
Baroness HORNSBY-SMITH: Could the noble Lord answer one question on what he has just said? If there is a joint Anglo-American undertaking, the English company is bound by English law. But what about the American one, if they are working together on a new process?
Lord BESWICK: If there were such a case and the information was likely to be damaging to the American element in the company, this would be a matter covered by the earlier part of the subsection, which says that no information should be disclosed which would cause damage.
The Earl of ONSLOW: If it is already covered by the first part by implication—and it is only by implication, as the noble Lord said—the courts may find otherwise; we all know that the courts cannot take into account what is said in Parliament but only what is said in Statutes. Would it not be reasonable to leave it in, to underline it and make it absolutely certain? What harm would this do?
Lord BESWICK: I think if we were to put everything in because it did no harm we should have a pretty lengthy Bill.
Lord BROWN: I think this argument is pretty pettyfogging. The circumstances in which the Minister would have to make an order are when he is requested to do so by representatives of trade unions. I have long experience of giving copious information to shop stewards and trade union officials, and the one thing they do not want is information which would be of value to competitors. I have given information on occasions when the fact that I have given it has been deplored, because they felt it would be of value when it leaked out. I have found a consistent attitude on the part of employees, trade union officials and shop stewards, resenting the giving of any information that could be of damage to the firm and thereby to their own employment. The other point about this,

757
as my noble friend on the Front Bench said, is that value to the competitor is obviously injury to the firm. I do not think that needs debating at all. I think the whole thing is rather pettyfogging. I believe that people do not want information which can directly or indirectly affect their own chances of employment. There will not be appeals to a Minister coming for orders in these circumstances.
Lord ROBBINS: I cannot resist the feeling that the victory of the noble Lord, Lord Cambell of Croy, in expunging the adjective "substantial" gives him all he wants as regards injury to commercial interests by providing information to competitors.
Lord CAMPBELL of CROY: What I am seeking to do here is to make sure that various possible areas where disclosure of information might have adverse effects are considered for inclusion in this section of the Bill. As the noble Lord, Lord Robbins, has said, the decision taken recently by your Lordships' Committee has improved the situation where this is concerned. On the first paragraph suggested here, I realise that the drafting was not for this purpose complete, but I could not resist taking the wording complete from what had been used in a well-known case recently by a Minister. As the noble Lord, Lord Beswick, pointed out, there was nothing here to indicate that it also had to be to the detriment of the company. It was just the word "competitors" that implied that it would be. The noble Lord has indicated that he does not regard a separate subsection as necessary because it would be caught by the previous subsection on injury.
As regards the second paragraph which I have proposed, the noble Lord has given a rather sweeping assurance, because he has stated that it would not be possible for a claim to be successfully pursued against a company which was having to carry out this Bill when enacted. Therefore, when they were compulsorily required to provide information, if it did appear to cause damage to third parties, or to be in breach of contractual rights, then no claim could be pressed and the company could not be sued. I hope that that is the position. I would ask the noble Lord to confirm that he can give the categorical state-
758
ment that no claim of the kind which my second paragraph tries to cover could be pursued successfully. I would give the noble Lord a chance to state that categorically before continuing.
Lord BESWICK: The noble Lord will know, and the Committee will suspect, that I have no legal qualifications. I can go only on advice that I am given. The advice that I am given is that the company required to disclose information by law, whether to the Government or to its workers, could not be successfully sued for damages. If it was shown that the company had been required to furnish the information by law, this would be a complete defence.
Lord CAMPBELL of CROY: I shall no doubt have time to consider any further implications of what the noble Lord says. It looks as though it is not necessary to put this into the Bill because the company would not be in a position to be vulnerable to this kind of claim. Therefore, I beg leave to withdraw the Amendment.
Amendment, by leave withdrawn.
4.53 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 199:
Page 23, line 10, at end insert—
("( ) that the information required cannot reasonably be furnished within the time specified in the notice or at all;").
The noble Lord said: This is a fairly straightforward common-sense subsection, which we think ought to be added again in the interests of completeness in giving guidance to the Advisory Committee. There could be situations where the company could not reasonably furnish the information specified within the time laid down. The Minister may genuinely have made a miscalculation. He can set the time scale. The Bill states that it must be not less than 28 days for preliminary order, and so on, but if he had inadvertently asked for information which takes much longer to assemble than he thought, then we think that again this ought to be clearly written into the Bill, unless it is already covered somewhere else. I beg to move.
Lord MELCHETT: I am not sure whether the noble Lord was taking Amendment No. 275 with this Amendment, but I think it might be sensible

759
to do so unless he has any objection. It covers a similar point.
Lord CAMPBELL of CROY: I propose to take it separately.
Lord BRUCE of DONINGTON: I hope that I shall be able to persuade the noble Lord to withdraw this Amendment. The information required once again is circumscribed by Clause 23. If the noble Lord looks down Clause 23 and at the items required to be supplied, he will find that, apart from two items, they ought to be able to be supplied within a matter of hours. If the firm has not got the information in subsections (2)(a), (b), (c), (d), (e) and (h), (i), (j), (k) readily available, it surely does not comply with those conditions that render ordinary private enterprise firms viable. If they do not have this information, they have no business to have the noble Lord's support.
In so far as items (2)(f) and (g) are concerned, which are figures related to productive capacity and capacity utilisation of the undertaking and also in regard to the undertaking's output and productivity, I readily concede that these require a certain amount of extra time. But if these figures cannot be provided by the ordinary accounting or administrative organisation of a company or a group of companies within 28 days, one can understand the reasons why they are in such a state that the Government have to compel them to give information, and they have no right to have the noble Lords' support. I hope that on reflection the noble Lord will withdraw this Amendment, because if he continues with it he is conceding the existence within his own spectrum of support of firms that have no business to succeed at all.
Lord MELCHETT: I should like to make a slightly different point from that made by my noble friend, but I hope also to persuade the noble Lord, Lord Campbell of Croy, that the Amendments are unnecessary. We accept the principle that lies behind this Amendment, and. I was going to say, Amendment No. 275, but I gather that the noble Lord is determined to take that as a separate point, although I am assured that it is merely inserting "within a reasonable time" into a similar part of the Bill. If I may, I shall speak to that at the same time, and
760
the noble Lord may then decide to move it if he wishes.
The principle is that a company should not be forced to provide information it cannot provide, or cannot provide within the time specified. Nor should it of course be an offence to fail to so provide information. My noble friend has already pointed out to the noble Lord why he thinks it should be quite easy for a company to supply all the information they are likely to be asked to provide within the minimum of 28 days. The Bill already provides safeguards which cover both the inability to provide information, or not being given a reasonable time to do so, in the unlikely event of the considerations which my noble friend mentioned not applying. On timing, I would draw your Lordships' attention to subsection 24(1)(a) which specifically states that reasonable time must be given, and this must not be less than 28 days. If the time specified in the notice were to be unreasonable, or if the information were simply not available, it would be a defence in terms of subsection 28(1)(b) in that both these would be a reasonable cause for failure to have provided the information, and hence the company would have committed no offence in thus failing to provide it. In our view there is therefore no need to incorporate either Amendment No. 199 to Clause 24 nor Amendment No. 275 to Clause 28.
Lord CAMPBELL of CROY: I assure the noble Lord that when we come to Amendment No. 275, which is some way ahead, I shall not spend any time on it. The point we are considering here is to ensure that this part of the Bill covers the various special reasons which the advisory committee should take into account. The noble Lord, Lord Bruce of Donington, in his criticism of any company that might run into delays, may have misunderstood me. I was not suggesting that this would be normal. I was anxious to cover the exceptions which he agreed might occur and ensure that the advisory committee was authorised to take this special reason into account. The gist of the Government's reply is that the advisory committee would take this into account and that it is catered for without it having to be spelled out in the Bill. I am glad to hear that.
When the noble Lord, Lord Bruce, says the majority of companies should be

761
able to produce the information within a matter of hours, he does not appear to be in agreement with the Government, who have given at least 28 days, and longer when 28 days might be insufficient.
Lord MELCHETT: This is another example of how extremely generous and reasonable the Government are being in seeking to implement the provisions of the Bill.
Lord CAMPBELL of CROY: But they appear to be out of line with the thinking of the noble Lord, Lord Bruce of Donington. I was not suggesting that 28 days would not be enough. I simply wanted to ensure that the advisory committee would not find itself powerless to deal with such a case when a good reason could be given why the information could not be provided in time. However, having received that assurance from the Minister, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.3 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 200:
Page 23, line 10, at end insert—
("or
( ) that to compile or assemble the information would involve an amount of work or expenditure out of reasonable proportion to the value of the information;").
The noble Lord said: This is another commonsense point. It may need to be included, if the advisory committee is to be able to take it into account, or the Government may say it is not necessary because it is already catered for. We foreshadow situations when the work of compiling and assembling certain information which has been asked for is out of all proportion to the value of the information, and we would like an assurance that the Bill covers this point. I beg to move.
Lord BESWICK: Perhaps I might remind the noble Lord, Lord Campbell of Croy, and others of the procedure involved here. If the Minister under Clause 23(1) requires certain information from a company, the company would then provide it to him. Then, under Clause 24(1), the Minister might require the company to provide to union representatives
"…the whole or part of the information furnished to him under Section 23…"
762
There is no question here of the company being asked to provide new information; it is the same information being supplied, totally or partially, to the trade unions, so there can be no extra cost at all.
If an Amendment of this kind had merit, it would have had merit at an earlier stage of the Bill and not at this point. I would, however, give this assurance to the noble Lord: it is certainly the intention of my right honourable friend and anybody else who is implementing this Bill that if it can be shown to the Minister that there would be an undue amount of work involved, this would be a matter which would have to be considered, and one would have to be reasonable about it.
Lord CAMPBELL of CROY: The noble Lord pointed out that this could have arisen at an earlier stage in our proceedings and I would not disagree with that. Perhaps it was necessary to write something like this into the Bill. However, the noble Lord has given an assurance that he does not visualise a situation arising where the advisory committee would not be able to give this as a special reason in practice, without it being written into the Bill, and I therefore beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord CAMPBELL OF CROY Lord CAMPBELL OF CROY moved Amendment No. 201:
Page 23, line 13, leave out ("of") and insert ("or").
The noble Lord said: This Amendment is tabled simply to correct what appears to be a misprint in the Bill. I beg to move.
Lord BESWICK: I have on occasion made the wounding and unkind charge that certain noble Lords opposite have not read the Bill. It seems obvious that the noble Lord, Lord Campbell of Croy, has read it with great thoroughness, certainly in this case, and I therefore apologise and freely accept his Amendment.
Lord CAMPBELL of CROY: I thank the noble Lord for his apology.
The DEPUTY CHAIRMAN of COMMITTEES (Earl Cathcart): I should point out in calling Amendment No. 202 that if this Amendment is agreed to, I

763
will not be able to call Amendments Nos. 202A, 203 or 204.
5.8 p.m.
The Earl of BALFOUR The Earl of BALFOUR moved Amendment No. 202:
Page 23, leave out line 14 and insert—
"(b) to one representative chosen from and by the employees of the undertaking,")
The noble Earl said: I appreciate that my drafting of this Amendment may not be correct. I am anxious, nevertheless, to have a point cleared up and that is why I move it. Under this part of the Bill the Minister may serve a further notice requiring the company:
"…to furnish to a representative of each relevant trade union within… not less than 28 days, as may be specified in the notice, the whole or part of the information furnished to him…"
Under subsection (8) of Clause 24 we read:
"If a notice given to representatives of relevant trade unions… states that the Minister does not propose to require the company… concerned to furnish all the information, it shall give such indication of the nature (without disclosing the substance) of any information which the Minister proposes should not be furnished…"
Of course, it will not always be the Minister of State himself who will do this. It may be a senior official of the Department concerned and when subsection (5)(b) refers to,
"…a representative of each relevant trade union, an opportunity of making representations to him",
this could mean a civil servant being surrounded by 12 or 14 experienced trade union representatives battering him with questions. If he is able to give them,
"…such indication of the nature (without disclosing the substance) of any information
and not let the whole thing leak out, that chap will be doing a marvellous job indeed.
I am therefore suggesting that we bring in one person to decide this because subsection (8) goes on:
"…it shall give such indication of the nature (without disclosing the substance) of any information which the Minister proposes should not be furnished for special reasons as will enable the relevant trade unions' representatives to consider whether or not they ought to exercise their right to require a reference under section 25 below."
764
Quite honestly, to take myself as an example, if I have been told half the information—that is, told the nature without being told the substance—I shall not know whether I am in the right sort of position to appeal. I shall not have a clue. That is why I am proposing in Amendment No. 202, though it is wrongly drafted, and in Amendment No. 213, that we should make it one person.
At the top of page 24, the Bill states that a reference to an advisory committee can be required. I repeat that it should be by the one representative who has been given the information under the provisions of Amendment No. 216. Clause 25(5) states:
"The committee shall give the company or companies concerned and…"
and I suggest here "the one relevant representative",
"an opportunity of making representations in relation to the matters to which the reference relates."
Again, that comes into Amendment No. 228. I am putting a condition on this chap and, if I may ask your Lordships to turn to Amendment No. 266, that brings in confidentiality.
I should like the Government to consider inserting right at the bottom of page 25 words roughly to this effect:
"for the use of the one representative under Clause 24(5)(b) above, if that person has been sworn to secrecy and is approved by the Minister."
I may be wrong in using the words, "approved by the Minister", but let us allow this one representative of the workers to know this confidential information and let us make him swear to keep it secret, so he can really act as the workers' representative as to what should be disclosed. Do not let us bring in 12 or 14 representatives. I believe that we could get misinterpretation, and I am quite certain—if I may go back to what originally made me wonder about this—that nobody could ever satisfactorily give an indication of the nature without disclosing the substance of the information. He would really be a better man than I if he could do that. I am sure this will go wrong. I am sorry that my drafting is not right, but I ask the Minister to reply to the points I have made. I would rather bring this up during the Committee stage than later on. I beg to move.
Lord BROWN: I hope that the Committee will not have to spend too long on the substantial edifice of argument which has been erected by the noble Earl on what I believe is a misunderstanding. This Amendment is entirely inconsistent with the reality of industrial life. There is no such thing as one representative of all employees. They have different interests, different strata, different sections, different departments. The possibility of getting one representative of everybody is as likely as of getting one representative of the nation in this House. The Amendment is completely unrealistic and I hope that the noble Earl will withdraw it very rapidly.
Lord LOVELL-DAVIS: First, I refer to the noble Earl's reference to the disclosure to the trade union representatives of the nature but not the substance of the information. He created a picture of a poor civil servant surrounded by vulture-like trade unionists, but I feel that I should point out that this information is to be provided in writing. The Bill uses the words "by notice". Therefore, there will be an opportunity for everyone concerned to choose his words with care.
The Government have made it clear that they believe—and we have already been over this ground a great many times—that the most appropriate channel for disclosure of information to workers is presented by trade union representatives. I do not wish to retrace the paths of argument along which we have already made our arduous way. I am sure that by now noble Lords will appreciate the basis of the Government's case. For my part, I recognise the strength of feeling that lies behind the counter-arguments.
I should like to ask the noble Earl whether, in speaking to Amendment No. 202, I may, as he has also done so, speak at the same time to Amendments Nos. 213, 216, 228 and 266. The Amendments present a new proposal by which one man will be elected from and by the employees of a company. The Government oppose this proposal because they believe that, where there is a trade union representative, he is the proper and most appropriate person to give the information to. I recognise that many noble Lords will not consider this a conclusive argument and I should therefore like to
766
consider the proposal simply as a means of ensuring that there are appropriate arrangements for information disclosure.
The proposal in the Amendments would single out one man in a business to be the recipient of all information relating to that business. As my noble friend Lord Brown has pointed out, this would be almost impossible to do. It would preclude the possibility of local representatives receiving information at plant level which applied to that plant. The Amendments would require a means of electing the representative which would be lacking in many if not all companies. In short, the proposal is not really an appropriate solution and, quite apart from the question of trade union representation, it has grave disadvantages in imposing a single blueprint which is likely to be unsuitable for most if not all companies.
In addition, Amendment No. 266 proposes that, while the information is to be confidential, it may be released under oath of secrecy to the one representative. But what is that representative to do with it when he has it? He will be prevented from discussing the information with the workers who elected him since that would be to break the oath of secrecy. His electors would know that he had the information—and perhaps it might be about redundancies or other matters very closely affecting their interests—yet he could do nothing about it. This is tokenism. It is disclosure in name but not in practice.
The Earl of BALFOUR: I believe that I am almost satisfied with the noble Lord's answer, but one point I should like to make is that some of the information we are considering can, under certain circumstances, be kept secret. If it is kept secret—and clearly it is being kept secret even from the trade unions—and is, perhaps, disclosed only between the Minister and the company, I cannot see how the trade union representatives will know whether they should exercise their right to require a reference under Clause 25. I have been trying to think about this from both points of view. If the representative has only half the information, how is he to know whether he should exercise that right? I am sure that the noble Lord will understand the difficulty. I am grateful for his reply, but I wonder

767
whether he would think about that point again.
Lord LOVELL-DAVIS: I feel that this is really beyond the scope of the Amendment. I shall be answering that point on Amendment No. 207B, if the noble Lord can bear with me until then.
The Earl of BALFOUR: I am grateful for that reply, in the light of which I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
The DEPUTY CHAIRMAN of COMMITTEES (Earl Cathcart): In calling Amendment No. 202A, I should inform the Committee that if this Amendment is agreed to I cannot call Amendment No. 203.
Lord MELCHETT: I beg to move Amendment No. 202A, to which I spoke on Amendment No. 163A. Judging by precedents, I imagine that the noble Lord will not be moving Amendment No. 203. I hope that the Committee will accept this Amendment.
Amendment moved—
Page 23, line 14, leave out ("a") and insert ("the authorised").—(Lord Melchett.)
Lord LOVELL-DAVIS: I beg to move Amendment No. 206, to which my noble friend Lord Melchett spoke on Amendment No. 163A.
Amendment moved—
Page 23, line 20, leave out ("representative of each relevant trade union") and insert ("authorised representatives").—(Lord Lovell-Davis.)
5.22 p.m.
Lord CULLEN of ASHBOURNE Lord CULLEN of ASHBOURNE moved Amendment No. 207B:
Page 23, line 25, leave out subsection (8).
The noble Lord said: When the Minister contemplates serving a notice on a company to disclose information to representatives of each relevant trade union, he gives to the company, and to the trade union representatives, the right to make representations as to whether the Minister should or should not require the company to furnish to the trade union representatives the information which it has already furnished to the Minister. These representations cannot be made by
768
the trade union's representative without his having been at this stage given some inkling of what the information is. But the Bill contains no provision about the giving of that information. Having considered these representations, the Minister then directs the company either to supply the information to the union's representative, or not to do so. If he directs the company not to supply the information, he must, under Clause 24(8), indicate the nature without disclosing the substance of the information not to be supplied. There is every likelihood that such not to be supplied information would be, in Stock Exchange terms, "price sensitive", and that the mere fact of its existence being indicated in this secretive manner would lead to speculation. If the company were a quoted or listed company, that speculation would be financial. In any event, it would be undesirable and unsettling. The only way to avoid these effects would appear to be to remove the whole of subsection (8) from the Bill. I beg to move.
The DEPUTY CHAIRMAN of COMMITTEES: In calling this Amendment, I should have informed the Committee that if it is agreed to, I will not be able to call Amendments Nos. 207A to 213.
Lord DRUMALBYN: This is a suitable point to examine the working of the whole clause, rather than to wait till the debate on the Question, Whether the Clause shall stand part. The Amendment enables us to take cognisance of the whole procedure of which, perhaps, subsection (8) is the culmination. As my noble friend indicated, subsection (1) enables the Minister to require a company or companies to pass on a notice to the trade union representatives about the information which the company or companies has furnished to the Minister; and to pass on that information within 28 days. Incidentally, I am not quite certain whether what is proposed in paragraph (b) of subsection (1) takes place before what is proposed in paragraph (a). I am not quite certain exactly what that means. There is provision for a further notice requiring a company or companies to pass on the information—all or any of it—and for a notice about the furnishing of that information to be served on the representative of a trade union. I find the clause rather confusing, and therefore it would be worth while

769
to try to bring some clarity into it. Subsections (2), (3) and (4) require the Minister not to oblige the company to pass on the information to trade union representatives if he considers that there are good reasons not to do so. Subsection (5) seems to give a representative of each relevant trade union an opportunity of making representations to the Minister about giving a notice under subsection (1) before they have any inkling at all of what the information is about. When we come to subsection (8), we see that they know something about what the information is to be.
Presumably it is envisaged that companies furnishing information to the Minister may, if they think fit, pass on to the Minister at the same time their reasons for thinking that it is not appropriate to disclose that information to trade union representatives. So far as I can see, they can do so if they wish, and there is nothing in the Bill to prevent them from doing so. Unless they do so, it is difficult to see how the Minister can form an opinion on special reasons—as distinct from the reason of the national interest—for not passing on the information. Alternatively, the Minister, having read this information—or not having read it because it has not been supplied—may give the company or companies an opportunity to make representations to him, and so—
Lord BESWICK: I appreciate that the noble Lord is trying to save the time of the Committee, but before he proceeds further I should like to say that I wonder whether he is not going a little wide of the Amendment moved by his noble friend. I suggest that perhaps it would be better to dispose of this Amendment before taking up the points which the noble Lord is now making.
Lord DRUMALBYN: With respect, I should like to develop my argument a little further; if then the noble Lord still has the view he has just indicated, I should not personally agree with him, but I will comply with the wishes of the Committee. As I was saying, unless the reasons for not disclosing are given to the Minister, the Minister can hardly form an opinion about the special reasons. It is difficult to see how the Minister can give an indication of the information which should not be furnished to trade
770
union representatives—and here I come to subsection (8)—without giving them at least a strong hint about the substance of the information. Even if he succeeds in doing that—in not disclosing the substance but in giving a hint about the nature—the mere indication is bound to arouse the curiosity of the trade union representatives, or even their suspicions, and in nine cases out of ten is likely to mean that trade union representatives will try to get information either by appealing under the next clause, or in other ways.
Moreover, the fact that such information is not to be passed to the trade union representatives—if that proves to be the fact—is bound to become known publicly, and to give rise to speculation in the Press, and possibly speculation on the Stock Exchange, as my noble friend Lord Cullen of Ashbourne indicated. It would seem to be an open invitation for trouble making. It would be much more satisfactory not to require the trade union representatives to be told what information the Minister has required to be furnished to them under Clause 23 until it has been decided how much of that information is to be passed on to the trade union representatives. If the Bill were amended in that sense, there would be no need to make provision for references to the advisory committee by the trade union representatives. Unless the Bill is amended in that sense, it is difficult to see how confidentiality can be preserved, even up to the point where the information is disclosed to trade union representatives. The trade union representatives are bound to require a reference in almost all cases, and I doubt whether they would think that they were doing their job if they did not require it.
I cannot see how the advisory committee would be able to avoid, in the course of the hearing, extending the indications of the nature of the items of information. My noble friend Lord Campbell of Croy has put down an Amendment about this on the next clause. In other words, confidentiality will be impaired even if the advisory committee recommends against disclosure to the trade union representative. The case I am making is that the only way to preserve confidentiality is not to let the trade union representative know any items of information which the Minister either provisionally or finally decides need not

771
be passed on. If he lets them know at an earlier stage, most of the information will come out and certainly confidentiality will be impaired. I beg to support my noble friend.
Lord DAVIES of LEEK: I do not find any difficulty with this subsection and I believe that to erase it could create confusion. All that subsection (8) is saying is that if a notice states that the Minister does not propose to require from the company all information it shall indicate to the trade union and others—I am putting it into plain English instead of legal verbiage—the nature of the information not needed in order that the trade union can judge whether they want to be released from the duty of disclosing information to the union. I can think of quite a lot of information—especially in the drug industry if I may declare an interest—where scientists and groups are working in a laboratory. They may be in unions or in groups and if that information is passed on it could do injury and damage to the firm and to the country in exports.
I can give examples where British drug firms have overseas licences earning good money for the British exchange. I do not want to sound presumptuous, but scientific workers working on drugs or on research in a laboratory know that their knowledge, if disclosed, would be of damage or injury to the nation and the firm. That is all that the subsection is saying. If the Minister does not want all the information a substantial reason must be given or could be given to the trade union and in eight cases out of ten a reasonable trade union, whether scientific, industrial or whatever, would accept that because they would understand the nature of the industry. I hope that my noble friend, when he comes to reply, will retain this clause because I do not see it in any way trespassing on the democratic rights of firms. In fact it is protecting them.
Lord CAMPBELL of CROY: I will not repeat what my noble friend has said, but I think the wording of this subsection asks for something which is exceedingly difficult to carry out. The middle of the subsection reads:
… it shall give such indication of the nature (without disclosing the substance) of any information…".
772
This, I recognise, is an exceedingly difficult and delicate part of the Bill. If the timing which my noble friend Lord Drumalbyn has suggested found favour with the Government, it would remove that exceedingly difficult operation. I think that companies will be placed in a very difficult position if they are trying to carry out what is clearly the principle but which is very difficult to put into practice.
I should like to refer to something which the noble Lord, Lord Brown, said earlier. He said that in his experience trade union representatives would not want disclosed anything which was going to help competitors to the detriment of their own company. We also know that there can be the other kind of case where trade union representatives are suspicious because they think the information is not being given because it concerns closures or redundancies. There are situations where trade union representatives will be trying to find out what is at the back of it when they know that information is being considered which the company is suggesting should not be disclosed. It will be exceedingly difficult to carry out this operation of disclosing the nature without disclosing the substance. I ask the Government to consider very carefully the suggestion which my noble friend has made.
Lord BROWN: I do not look at subsection (8) with any great enthusiasm. The whole business seems so complicated. Having had the experience of willingly giving all sorts of information to shop stewards and unions for years and years, I can say that I have never run into any trouble at all. It seems to me an awfully long-winded way of insisting that they get it. However, it seems to be necessary in the Bill.
To take up the point of the Amendment, if one reads subsection (8) and listens to the argument for its deletion, one gets the feeling that there is reasonableness in the argument until one turns to Clause 23(2) and looks at the matters under which the Minister can in fact get information. While the discussion has been going on, I have been reading paragraphs (a) to (k) and I cannot see that anything there could in any circumstances affect the Stock Exchange or disclose in a subterranean way knowledge about the firm. If any one of the paragraphs (a)

773
to (k) referred to the firm's intention of taking over another firm or selling one of its subsidiaries, then indeed subsection (8) may have its dangers, but in the light of all these things I do not think it has.
Lord DRUMALBYN: If the noble Lord will turn the page over and look at subsection (3)(b) and (c),
"in relation to a future specified date or a future specified period"
he may have some grounds to qualify it.
Lord BROWN: Subsection (3)(b) is undertaking capital expenditure.
Lord DRUMALBYN: Would the noble Lord turn over to page 22 and read (c).
Lord BROWN: I am still of the same opinion as I was before. Future capital expenditure—I would make the suggestion that firms who are sensible are already doing this. I really cannot see the danger in the arguments. As my noble friend put it—I am happy to call him my friend—when I turned back to (k) I thought: No; in the light of this restriction of information the argument does not hold that water that I thought it did.
Lord DAVIES of LEEK: May I ask my noble friend about (j)? I think my interpretation of subsection (8) was correct, but (j) says:
"sales of industrial or intellectual property owned or used in connection with the undertaking…"
what is "intellectual property"? This is where I made the point about research workers.
Lord BROWN: Sales of know-how; negotiation of licences with companies overseas.
Lord DAVIES of LEEK: I think it goes further than that. There is the molecular roulette which chemistry plays in the drug houses finding formulae. That is certainly valuable information which has made firms very wealthy indeed and when they are playing this molecular roulette and discover an assimilation of molecules that is of value in medicine that is intellectual property, is it not?
Lord BROWN: Information from a firm to the Minister that they are negotiating a licence with Indonesia or wherever it may be is not detailed, technical information.
Lord DAVIES of LEEK: It is not, I agree.
Lord CULLEN of ASHBOURNE: To return to what the noble Lord, Lord Brown, said, I feel that it is (d) and (e) which are liable to be worrying in this case. I think that an inkling of information that an asset is to be either required or disposed of is the kind of thing that is worrying if it leaks out.
Lord BROWN: If it leads to any disposal of assets there is still water in that argument; but it says "such assets" and refers to "fixed capital assets in an undertaking". I am sure the noble Lord will agree that information given by a firm about the sale or purchase of fixed capital assets, which means plant or machinery, is not in the category of dangerous information which would have an effect on the Stock Exchange or elsewhere.
Lord LOVELL-DAVIS: The right to require a reference to the advisory committee under Clause 25(2) to make representations to the advisory committee under Clause 25(5) is one held by both company and trade union representatives. We are seeking, in so far as this is possible, for both to have equal rights. It is most important the provisions in the Bill relating to reference to the advisory committee be fair to both sides.
The company will know, by virtue of Clause 25(6), exactly what information the Minister provisionally requires it to provide. Clearly the substance of this cannot be provided to trade union representatives, since this would negate any attempt by the company to claim that further information should be witheld for special reasons. There is therefore no question of the substance of the information being disclosed. Indeed, this is explicitly stated in Clause 24(8) in the words "without disclosing the substance" In the matter of disclosure I should like to refer to, for instance, the Ryder Report on British Leyland. The Report indicated the nature but not the substance of the information. It contained a general indication of future developments but omitted the facts of specific plans. In Chapter 14 of the Report a lot of information was given about the cost of future development programmes but details of these programmes were omitted.
Equally, however, the trade unions must have some indication of what is at dispute.

775
We therefore provide that the notice furnished on the trade union representative should indicate whether the Minister is requiring all or some of the information which was furnished to him to be provided to workers and, in addition, whether any is being witheld for "special reasons", and if so, what is its general nature. This is necessary if the representations by trade unionists are to be on a sensible basis. Without this, a trade union representative would not know whether information was not being disclosed because of special reasons—in which case he could make his case to the advisory committee—or because of national reasons, or simply because of an exercise of Ministerial discretion—in which case the advisory committee would have no locus. Similarly, unless the trade union representative knew what type of information it was proposed to withold for "special reasons", his arguments to the Committee would be greatly handicapped.
There is no question of the information at stake being disclosed to the trade unions. Subsection (8) provides that they must be told of the nature but not told of the substance of the information provisionally witheld for special reasons: that is, they must be told that the Minister intends not to require disclosure of information about capital investment by product, or about demand for the company's products; but they must not be told this in such a way that the facts at stake can be discussed. This is not impossible: indeed, the Ryder Report on British Leyland to which I have referred provides a model. In this way, the rights of the trade unions and the confidentiality of information will both be upheld.
I have endeavoured to explain why this subsection is both necessary and fair. I hope that in the light of this explanation the noble Lord will withdraw his Amendment.
Lord DRUMALBYN: Before we reach a conclusion on this, may I say that the whole of the machinery (as the noble Lord, Lord Brown, indicated) is so complicated that I think it is up to the Government to find some way of simplifying it before we come to the final stages of the Bill. Take the question of appeal alone, which is in the next section. If one trade union representa-
776
tive asks for a reference to the advisory committee because he wants information disclosed which the Minister is not proposing to disclose, the Committee must see each relevant trade union representative—there could be 20 or 30 of them—presumably separately. I do not know; but the machinery is so grotesquely complicated that I think the Government should look at it again.
Lord BESWICK: It is worth pointing out that one of the reasons why it is so complicated is that we have been anxious to meet criticisms made and to have safeguards written into the Bill. This inevitably leads to complication.
Lord CULLEN of ASHBOURNE: This has gone much wider than the scope of my original Amendment. I agree with my noble friend Lord Drumalbyn that it would be a good idea for the Government to look into this again. In the meantime I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
The PRINCIPAL DEPUTY CHAIRMAN of COMMITTEES: Before calling Amendment No. 207A, I should inform the Committee that, if it is agreed, I cannot call Amendments Nos. 208 or 209.
Lord MELCHETT: Amendment No. 207A was discussed with Amendment No. 163A. In accordance with the usual practice I assume that the following two Amendments will not be called. I beg to move.
Amendment moved—
Page 23, line 25, leave out ("representatives of relevant trade unions") and insert ("authorised representatives").—(Lord Mclchett.)
Lord MELCHETT: Amendment No. 212A was discussed with Amendment No. 163A. I beg to move.
Amendment moved—
Page 23, line 31, leave out ("relevant trade unions' ").—(Lord Melchett.)
Clause 24, as amended, agreed to.
Clause 25 [Release from duty to disclose information to trade union]:
5.49 p.m.
Lord WIGODER Lord WIGODER moved Amendment No. 215:
Page 23, line 36, leave out ("advisory") and insert ("appeal").
The noble Lord said: I beg to move this Amendment. There are certain other Amendments consequential upon it which, for the sake of the record, are Amendments Nos. 231, 232, 243, 251, 264, 295, 296, and 298. The effect of these Amendments is to amend the Government's proposals for the advisory committee as put forward in the Bill. There is a further Amendment (Amendment No. 294) in the names of the noble Lords, Lord Campbell of Croy and Lord Aberdare, which deals with an alternative method of solving the same problem. I have communicated with those noble Lords and with the noble Lord, Lord Beswick, and I think it would be for the convenience of the Committee that all these matters might be debated together at this stage.
Lord CAMPBELL of CROY: I was going to suggest that as being convenient. This therefore includes Amendments Nos. 226 and 263, together with Amendment No. 294 to which the noble Lord referred.
Lord WIGODER: I am grateful. If there are to be provisions for compulsory disclosure of information, some of which may be of an extremely commercially sensitive nature, obviously there has to be some machinery for deciding in a disputed case whether a piece of information should be disclosed. Clearly, its disclosure in error or by a mistake as to its importance might have disastrous consequences for a company, and might have an equally disastrous consequence for employees of that company and therefore for the community as a whole. It is important that any such disputes should be resolved, and resolved by machinery which is quick, fair and commands general confidence. There are three proposals before the Committee. There is a Government proposal; there is a Liberal proposal; and there is a Conservative proposal. I use those words as a form of shorthand. I hope members of the Committee will agree that matters of Party political dogma do not enter into this part of the Bill, and all the proposals are being put forward in a constructive spirit, in good faith and in an attempt to resolve a somewhat difficult problem.
The Government proposals are set out in Clause 25 and Schedule 5 of this Bill. They are by far the most complicated of the three alternatives before the Committee. Under Clause 25 and Schedule
778
5 if there is a difference of opinion between the Minister and the company or the trade union representative as to whether a piece of information should be disclosed, the Minister then refers the matter to an advisory committee. The advisory committee is the one set out in Schedule 5 to the Bill which consists of three people in all: a person with experience in industrial affairs as an employer or manager; a person with experience in industrial affairs as a representative of workers; and a chairman who will be a barrister or solicitor. The Minister will refer the matter to such an advisory committee, and that committee will report back to the Minister. If the Minister accepts the advisory committee's recommendation under the Government's Bill, then the matter ends there and the Minister makes the appropriate order. If the advisory committee report that a piece of information should not be disclosed, but the Minister still feels the advisory committee is wrong and it should be disclosed, the Minister makes an order and lays it before Parliament which is subject to annulment in pursuance of a Negative Resolution of either House of Parliament. I hope that is a reasonably accurate presentation of the proposals set out in the Bill for dealing with this difficult problem.
The Liberal proposal is much simpler; it is so simple it may feel a little out of place surrounded by the other provisions in this part of the Bill. Instead of an advisory committee, there should be an appeals committee which would be constituted as in Schedule 5 to the Bill according to the Government's proposals with the same representation, but that that appeals committee should determine matters that are referred to it, and the Minister should be bound by the answer. There would therefore be no need for the Negative Resolution procedure to be gone into in that case. The Conservative proposal is similar to the Liberal one, in that it also wishes to see an appeals tribunal as distinct from a purely advisory panel, a body which will determine the issues referred to it; but the Conservative proposal puts forward a purely legal body composed of three lawyers of considerable experience rather on the lines of the lands tribunal.
Those are the three various ways raised which have been suggested in the Bill and

779
the Amendments now before your Lordships' Committee. May I first refer to the Government's proposals as set out in the Bill. I will begin by dealing with the suggestion that if there is a disagreement between the Minister and the advisory committee there should be an order laid subject to annulment in pursuance of a Negative Resolution by either House of Parliament. Although that is a constructive attempt in good faith to deal with the problem, it is unlikely to contribute very much by way of a solution. We suggest that for three reasons: first, there are practical difficulties, certainly in the other place, in the way of obtaining a debate on an order and obtaining its anulment in pursuance of a Negative Resolution. Secondly, any debate that took place would consist of people debating matters about which they knew nothing.
I resist the temptation to make any of the more obvious comments on that situation. But if confidential information is in issue, its details cannot be disclosed in order that they may be debated in either House of Parliament. Therefore members of either House of Parliament would be reduced to attempting to debate details when all they will know will be the nature as distinct from the substance of what it is that they are discussing. That would mean—in relation let us say, to the intended acquisition of a fixed-capital asset for use in the undertaking—that Parliament would have to decide whether the disclosure of the information would cause injury to the undertaking without being told what it was proposed to be acquired, what its value would be, what its cost would be, what its prospects would be in terms of development, or any of the other myriad of commercial features which are directly relevant if a useful judgment were to be made as to whether the disclosure of the information may injure the undertaking. To ask Parliament to debate a matter about which it may know only the nature and not the substance, is to place a safeguard in this Bill which is in practice going to be meaningless.
The third objection to the proposed appeal to Parliament in this matter which is contained in the Bill is that the decision that has to be taken is not a decision that could be sensibly debated by a large
780
number of people. Even if the information were disclosed in detail—which I indicated it cannot because of the terms of the Bill—the practical consideration of whether the information about that asset might damage an undertaking is something that would not make for a coherent, balanced debate among a large number of people. I therefore suggest that the proposal in the Bill for an appeal by way of Negative Resolution procedure to either House of Parliament is not a safeguard of any value whatsoever. It follows from that that if there is no safeguard there, the proposal in the Bill establishes the Minister as his own court of appeal. The Minister will take the decision; if his decision is challenged, he will refer it to the advisory committee; if he disagrees with the advice given to him by the committee, in effect his decision will be final, because in practical terms there will be no possibility of the Minister's decision then being overruled in pursuance of any Negative Resolution. It would appear to be not desirable that such powers should be given in general terms of principle. I am not making any comments about excessive discretion by any particular Minister or anything of that nature. It would not be desirable that a Minister should be asked first of all to come to a decision and then, for all practical purposes, to be the court of appeal if the advisory committee disagreed with his own decision.
The other matter I would mention in relation to the Government's proposal in the Bill is that it would give rise to very much less consistency in its operation than would an appeals tribunal of the kind suggested in either of the alternatives that we are inviting your Lordships to consider. Again, that is not meant in any way as a criticism of any particular Minister. Ministers, however, change. Political implications are bound to be involved in decisions that are made under this Bill, and one has only to read, for example, the speeches made on Second Reading in the other place by Mr. Benn and Mr. Dell to realise that different Ministers, approaching this Bill with somewhat different political attitudes, are going to interpret vast sections of it in a different way. It would be undesirable—would it not?—that on questions of compulsory disclosure there should grow up a variety of practice rather than a

781
consistency of decision. Consistency, we would suggest, can be reached only if there is going to be an appeals tribunal sitting as regularly as may be needed and at least forming some general standards in dealing with these matters. For those reasons, we would venture to suggest that the proposals for an advisory committee and the appeal to Parliament will not be a satisfactory method of dealing with this problem.
The alternative which is suggested in the Amendment in the name of the noble Lord, Lord Campbell of Croy, of having a wholly legal tribunal, is one which again we on these Benches would venture to query. There are various reasons for that. First of all, the issues that the tribunal will have to decide are not going to be primarily legal issues. The issue of whether a particular piece of information might cause injury to a particular undertaking, and issues of that kind, are ones which are perhaps rather better suited to the representatives of employers and the representatives of workers on the kind of committee which is envisaged in Schedule 5 to this Bill.
Secondly, it might lead to a rather over-formal approach to this problem which is not necessary. Thirdly, there is a practical consideration if the appeal committee is going to consist entirely of a legal tribunal. I have already dealt with the question of the difficulties that would arise in any debate in either House of Parliament where nobody really knew what he was talking about. Equally before an appeals tribunal of whatever kind it was, as I understand the Bill, the trade union representative would not be able to argue the case with any great thoroughness because he would know only the nature of the information; he would not know the substance of it. If that is to be the situation, if before an appeals tribunal it is not going to be open to the representative of the relevant trade union to argue the details of a particular piece of information, it is of crucial importance, if the tribunal is to command the confidence of the trade union movement, that there should be on it somebody who was regarded as a representative of that movement and who can be relied upon, when the tribunal is finally considering the matter, to ensure that all the arguments are taken, knowing the full details as he will do, although the repre-
782
sentative of the company would not do, in the terms of the argument. We would therefore suggest that a tribunal of three lawyers is not going to solve this problem.
That leads us therefore to the proposal which is contained in this and the consequential Amendments, which is that the best answer is to have a tribunal constituted as in Schedule 5; namely, of the three people, the lawyer, the person experienced as employer or manager, and the person experienced as a representative of workers. One should have a tribunal of that kind, but one should give that tribunal the power to decide rather than merely to issue advice and allow the Minister in the exercise of what is already a very considerable discretion to overrule that advice if he thinks fit. In those circumstances, I venture to commend this Amendment and the consequential Amendments to your Lordships' Committee.
6.7 p.m.
Lord CAMPBELL of CROY: It might be convenient if I spoke to the Amendments which the noble Lord suggested might be considered with Amendment No. 215 and which are in my name and the name of my noble friend. The noble Lord, Lord Wigoder, has most clearly explained the reasons for the system which he and his colleagues have put forward in their Amendments. As he suggested, we entirely agree with him about the imperfection in the Government system: that it is an advisory committee and the Minister can overrule the advice which he receives. There is also another part of the procedure in the system laid down in the Bill which we criticise. That is, as Lord Wigoder pointed out, that the Negative Resolution procedure has been introduced and it would be exceedingly difficult for your Lordships and for Members of another place to have a debate on the subject of whether certain information should or should not be disclosed, whether the Minister had taken the right decision or not, if the information could not be made public, because that of course would prejudice the issue. So we, like the noble Lord, Lord Wigoder, feel that there should be an appeals body, whether it is an appeals committee which he has suggested or an appeals tribunal of the kind we have suggested,

783
which should take the decision which the Minister should then accept.
There is a further point in our group of Amendments additional to what the noble Lord, Lord Wigoder, has proposed. We think that the members of the appeals tribunal should not be appointed by the Minister himself from a panel of names which he keeps, as proposed in the Bill. We consider that the appeals body should be appointed quite independently of the Minister and his Department. As the noble Lord has said, we have based the proposal for an appeals tribunal in our Amendment No. 294 on the provisions of the Lands Tribunal Act 1949.
We have tabled these Amendments as an alternative to the advisory committee system. The Government will have noticed that we have not sought to replace the advisory committee system by our Amendments. So I ought to indicate that it is our intention that, if an independent tribunal of the kind put forward in Amendment No. 294 were to be thought the best of the three courses, it would replace the advisory committee. We are not suggesting that the two systems should exist side by side. But at this stage it seemed convenient to add the independent tribunal system in Amendments for consideration, so that it was possible also to suggest Amendments to the Government system as we go along.
The noble Lord, Lord Wigoder, has pointed out that in our suggested tribunal all the members would have legal backgrounds. I cannot help commenting on the irony that the noble Lord, who himself is a lawyer, should be criticising the fact that we are suggesting that they should all be lawyers. The reason is that we regard this tribunal as having the function of interpreting the provisions of the Bill. We have spent some time considering what should be in that part of the Bill which prescribes the special reasons which the advisory tribunal should take into account. They would also have to interpret the other subsection as to what were reasons of national policy. Therefore we suggest that legal backgrounds are required to carry out the interpretation of this Bill when it is enacted.
There is another point. Whether it is a good or a bad thing, in an advisory
784
committee of three where one of the members is to be appointed from an employer's background and another from an employee's background it could well be viewed as a committee of three with one member likely to take the employer's view on any matter and another as likely to take the employee's view; even if behind closed doors they may well be taking the opposite view. The third member might then be regarded as the man with the judgment of Solomon who has to try to deal with the difficult cases.
The advantage of the proposals which we have put forward is that it does not present that situation. They are three members of a tribunal with legal qualifications interpreting an Act of Parliament. However, may I say straight away that my purpose in speaking in this debate and listening most carefully, as I shall, to everything that is said in it is to try to reach agreement on what would be the most satisfactory kind of appeals body, including its membership. Although very late in the day the Government introduced safeguards at the Report stage in another place, including this proposal for the Negative Resolution procedure, we believe that the advisory committee system is complicated. The Government have tried to meet the criticisms which have been levelled at this system. None the less, while it is advisory and not an appeals tribunal we believe that it suffers from a major defect which we hope that the Government will recognise.
6.13 p.m.
Lord BROWN: To me Clause 25 smacks of taking a sledgehammer to crack walnut. I realise that to a large extent it is the result of listening to the Conservative Party dream up a series of awful nightmares on the flimsiest possible evidence and then trying to get the Government to take measures to reassure them on these nightmares. Having listened to the noble Lord, Lord Campbell of Croy, I believe that he is still inhibited by some of this phantasy thinking. Having said that and having listened to the noble Lord, Lord Wigoder, and how he conveniently referred to the Liberal, Conservative and Government proposals, I hope that the Government will take note of the so-called Liberal proposals. I would not say that if they were in the slightest way suggestive

785
of any change in principle of the Bill or, indeed, of any sub-principle of the Bill. The series of Amendments to which the noble Lord has spoken is entirely concerned with machinery. They would be helpful to all concerned, including the trade unions. I hope I shall not bring down on my head the wrath of the Front Bench when I say that I hope that the Government will consider those Amendments. If, in the light of them, the Bill were amended, I feel that at a later date it may well be acceptable to the Government in another place.
Lord HARMAR-NICHOLLS: Beneath the charming flippancy of the opening words of the noble Lord who has just spoken, he was clearly agreeing with the general point which was put by the noble Lord, Lord Wigoder, and my noble friend. I think he is right to have done that. I should not have thought there was much doubt now that it ought to be an appeal, not an advisory, tribunal. People's confidence must be maintained. There are all kinds of fears which will arise when this Bill becomes an Act, and anything that can be done to show the objectivity of any decision and its impartiality is quite essential. For that reason it is absolutely clear that it must be an appeal tribunal with the final word, and not an advisory tribunal which leaves the last word with somebody who at the end of the day will be a political Minister.
As to which of the two Amendments commends itself to this Committee, having listened to the most clear explanation which was given by the noble Lord, Lord Wigoder, I feel that on balance we can judge this on the basis of his explanation of what it is all about. He put it very clearly and simply. I do not think he was anything other than absolutely objective in the way he described the points of view and the thoughts behind the Amendment. Even on the basis of his own argument, however, I should have thought that my noble friend's solution is perhaps the right one.
If we want to give confidence to the people who have got to accept any decisions that flow from it, the more impartial the appeal tribunal is and appears to be the better it will be for bringing about the confidence which I claim is essential. I believe that my noble friend made a very strong point when he emphasised
786
that if the tribunal is made up of someone representing employers and managers and somebody else representing trade unions, there is bound to be a feeling that those two members of the tribunal will be biased in favour of whatever is wanted by their side. To that extent it takes away the objectivity and the impartiality that I think are absolutely essential. My noble friend's suggestion that it should be left to the lawyers—I myself am no lover of lawyers—is in this instance absolutely the correct one. The one claim which lawyers can justly establish is that part of their training is to be objective and to be able to listen impartially to evidence and form a clear view without having had personal experience of the mechanics of the subject they are examining.
I feel that the old-fashioned way of forming a Government was much the best way. They deviate from it nowadays. In the old days when a Minister of Health was appointed you did not think of appointing a doctor because you knew that to some extent he would be biased by his previous experience. When the Minister was obtaining advice from all the sources from which he obtains advice, he would not be able to accept outside expert evidence because of his own prejudices or beliefs arising from his previous connection with the profession. One tried not to appoint a Minister with past contact with the subject over which he had to preside for the reason that he could not approach it completely impartially.
Similarly, if the appeal tribunal is made up of people who are accepted on all sides as men who are trained to be objective, to accept arguments and to give quite impartial decisions, that will be the most satisfactory way of dealing with it. I was very disturbed to hear the noble Lord, Lord Wigoder, suggest that one of the reasons why he came down on the side of his own Amendment and the procedure suggested by the Government themselves was because, if I heard him aright, the trade unions may not feel that their point of view had had proper treatment unless a member of the tribunal himself was a trade unionist whom they could be sure would be likely to give what he suggested was an objective or impartial view. If that is what the noble Lord meant, I am disturbed by it.
Lord WIGODER: That is what I said and that is what I meant, but I said it against the background that the representative of the relevant trade union who is appearing in the case before the tribunal will not have for himself the details of the information which is being considered.
Lord HARMAR-NICHOLLS: I remembered that, but I felt that the fundamental point the noble Lord was making was a disturbing one. If we are going to accept that an appeal tribunal under this Bill, or any arbitrator or tribunal anywhere, has to recognise that somebody may not be prepared to accept the impartiality of the tribunal's decision unless he comes from their particular group or organisation, it is disturbing. I feel that we have gone a little way along that road over the last two or three years, and in my opinion it is absolutely vital that we should get back to the position where in this country we can appoint arbitrators and tribunals who are capable of being absolutely fair and at the same time absolutely objective and it is not necessary to put on a tribunal someone who carries the card of membership of some group or another before any decisions flowing from it are accepted.
I understand why the noble Lord, Lord Wigoder, felt that this was slightly different, but I do not accept that it is different. I believe we should be deviating from what I think is important if we did not use this Bill to emphasise that we have to establish the situation where we can appoint arbitrators, assessors and appeal tribunals without having to bear that consideration in mind. I feel that we should be doing the right thing under the Bill and the right thing to establish the sort of atmosphere we ought to have if we were to accept my noble friend's Amendment and make it the accepted, impartial, objective appeals tribunal made up of people trained to be impartial.
On the basis of the argument adduced by the noble Lord, Lord Wigoder, if one viewed it impartially it would be seen that his excellent and clear speech came down on the side of meeting this problem by having legal appeals. The noble Lord opposite seems to be disturbed, but I, too, can look at the clock. I consider that this is a subject worthy of having this kind of detailed comment, because
788
my contact with industry is such that I feel this is where more headaches will come from than many of the other provisions of this Bill. Unless when something goes to appeal one can be satisfied that it will be dealt with impartially, then all the other good intentions that the noble Lord has in mind will have gone. I support the argument adduced by the noble Lord, Lord Wigoder, but I would accept my noble friend's Amendment in preference.
6.23 p.m.
Lord BESWICK: I recognise the spirit in which these two sets of Amendments have been moved, but I rather agree with my noble friend Lord Brown when he says that the situation has been inflated beyond its true importance in relation to this Bill. I wonder whether I may try to put it into some sort of perspective. I would suggest to the noble Lord that the term "safeguard" that is being used very often (and the noble Lord, Lord Harmar-Nicholls, spoke about arbitration) elevates the whole issue to something the importance of which does not merit his anxiety.
Let us now see what sort of situation we are dealing with. We are here dealing with a piece of legislation which is intended, as I said on Second Reading, to help industry by the exchange of information. There is no question here of any punitive legislation or of imposing any burdens. There is no question here of taxation or any financial loss. Here is an attempt to get a voluntary system of planning agreements, and here is an attempt to get an economic climate within which companies may make their decision on a more secure basis of knowledge. We are hoping also to make it possible for trade unions to come in more and more in an effort to help their industry. We want the atmosphere of our economy in the future to be one in which the unions, instead of trying to get more and more for themselves, actively participate in the improvement of the performance of their respective industries. That is the situation and it is all based on a system of giving information in a two-way street.
There will be cases where this information is withheld. In the overwhelming majority of cases, we have good reason to believe that the whole system will be

789
voluntary, but occasionally—and only occasionally—there will be a case where the company will say, "We do not agree that the information should be given". In this case we have provided for the Minister, if he so decides, to say that the information should be given. For very good reasons which are set out in detail in the Bill, he can say that the information should be given, and it is a question of disclosure of that information.
I do not believe that any of us would say that Governments in this country or Ministers of those Governments behave irresponsibly, but in discussion it was thought that there should be safeguards. Therefore, a most elaborate system of safeguards has been erected. Earlier, the noble Lord, Lord Campbell of Croy—or his noble friend Lord Drumalbyn—complained that the system was too elaborate, that it would be time consuming. Nevertheless, we felt that some effort should be made to ensure that the fears that had been expressed at the beginning of this sort of exercise should be allayed. To encourage confidence we said that there should be safeguards. So we provided for the system of an advisory committee, and if the findings of this advisory committee are not accepted by the Minister, he then has to lay an Order. It would be possible for Parliament to say that the Minister is wrong and that he should not continue to persist in requiring this information.
This is a most elaborate system of safeguards. The noble Lord, Lord Wigoder, is endeavouring to strengthen these safeguards, and his Amendments provide a new procedure for settling whether information should or should not be disclosed to trade union representatives for special reasons. As he said, instead of the Committee established under Schedule 5 being an Advisory Committee—whose advice the Minister is not bound to follow, although there is the Parliamentary safeguard—the noble Lord is saying that the appeal committee should have the right of decision.
That is the issue between us, and we believe that in such a situation Ministers should take and accept the responsibility of Government. It is as simple as that. It is not our intention to pass responsibility to an appointed Committee, but rather to maintain the Minister's duty to come to his decision in the light of the
790
Committee's advice and then be called upon, if necessary, to account for his decisions before Parliament. The noble Lord, Lord Wigoder, called attention to the fact that if an order is placed before Parliament it will be possible for Parliament to discuss it; but, as he said, they would not know the substance of the issue in doubt and he did not think that the House of Commons or our own House would be the appropriate body to settle these things.
I wonder whether he is right? The two Houses of Parliament in this country have a very sure instinct in these matters. They have the instinct as to whether or not a Minister is behaving responsibly. Even if the matter is not debated, there is still a very sharp discipline on a Minister who knows that he may have to satisfy Parliament. Anyone with experience in these matters knows exactly what sort of discipline rests on a Minister who is likely to be called to Parliament in order to justify what he has done. Even though it is not possible to go into all the details, I think the instinct and the general judgment of Parliament is such that they can decide whether or not in a particular case a Minister is behaving wisely.
The noble Lord, Lord Campbell of Croy, said the advisory committee, or in his case it would be the appeals committee, would have to consider the national interest. This is not so. The advisory committee, or the appeals committee in his case, have to consider the special reasons; that is the point. They have to decide upon whether there are special reasons in a particular case, but the overriding national reasons are not theirs for consideration. Those are matters which the Minister may have to take into account when he comes to take his decision. I suggest to noble Lords that in cases of this kind, if it comes to this point—and I do not believe it will very often—the right way to go about it is to have the Minister answerable to Parliament.
As to the composition and scope of the advisory committee, there again I hope noble Lords will accept that we have tried very hard to come to a reasonable conclusion and a fair balance. In the first place, it was suggested that we use the central arbitration committee. That had certain advocates, but there were certain disadvantages. Then we came to the tailor-made committee

791
specially designed to have the skills and independence needed for the duties it would have under Clause 26 of the Bill. I do not accept all that has been said in support of lawyers. There are issues here which are not those that a lawyer can most easily decide upon. Many of these matters will be purely financial or industrial matters; the question of industrial organisations will come into them. Therefore, we came to this balanced committee in which we provided that the lawyer should be in the chair, with two other members of the committee with skills and experience on both sides of the industry. I would have thought that was a reasonable way of going about it.
The discretion of the Minister is limited, in that he shall not require disclosure in certain circumstances, but in our view it is right that the Minister should be the ultimate judge of whether these circumstances are met, just as he is the judge as to whether disclosure is warranted at all. I know that noble Lords are confronted with a situation which in some respects is novel. We are moving into a new phase of economic planning and have to feel our way carefully. But, if one looks back at the history of discussions on this matter, I hope it will be thought that the Government have leaned over backwards to listen to the advice given, and that the solution we have come up with is a balanced and responsible one which I hope the Committee will accept.
The Earl of ONSLOW: There is one point I should like to come back to yet again, which has been raised by the noble Lord, Lord Brown, and also by the noble Lord, Lord Beswick. It has been said that noble Lords on this side of the Committee are raising nightmares. It is surprising how frequently nightmares come true. We do not have to look back very far to see how people in certain parts of the country were prophesying large rates of inflation. Those inflationary rates have come true—yet at the time we were accused of crying, "Nightmare". That is my first point.
Secondly, does the noble Lord, Lord Beswick, have any examples already in existence of Orders in Council on the Negative Resolution procedure which can be made, but which neither House of Parliament can discuss the substance thereof?
792
—because if this is a totally novel procedure, it ought to be gone into with inordinate care. It is possible that if an Order in Council were laid at night someone could make bad slips of the tongue; we know what happens late at night in either House of Parliament, and in this there is no element of criticism; this is what happens at three o'clock in the morning. This is when Negative Orders tend to come up for debate. There would seem to be something very dangerous, in that confidences could come out then which should not. Alternatively, what precedents are there for discussing something in either House which neither House knows anything about?
Lord BESWICK: I cannot think of a precise precedent on the spur of the moment, but I can think of many examples where we have had regard to the principle involved without being quite certain about the details. As for the three o'clock business, if it was the fact that one was absolutely certain it was going to come up at three o'clock in the morning when everyone is asleep, it is conceivable that a Minister and his advisers might take risks. But it is not certain it will come up at 3 a.m. I do not believe any Minister lays an Order in the belief that it will come up at three o'clock in the morning and that, therefore, he will get away with it.
The Earl of ONSLOW: I did not say "in the belief that he would get away with it". What I am saying is that this is the kind of thing which happens. Verging on middle age, I am becoming a cynic. This kind of thing does happen and mistakes are made. From all sides of the Committee, this is what we are trying to avoid if humanly possible.
Lord BESWICK: I must emphasise again that we are here dealing with a minority, and I believe it will be a very small minority of cases. The more thought I give to this, the more reason I have for believing that such cases will not emerge, because they will have to be big, responsible companies, otherwise the Minister would not demand information in the first place. He would not go round asking small companies to give information. If there is a case where a company feel strongly that they should not give information, I am quite certain when the Order is laid, there will be

793
some noble Lords in this House—and one may well be the noble Earl, Lord Onslow—who will be acquainted with the issues involved and who will put up a very good Parliamentary performance against the Order. There are always ways to ensure that people are informed in either House.
Lord HARMAR-NICHOLLS: One has to accept the importance of the point made by the noble Earl, Lord Onslow, about the Minister who, at the end of the day, is responsible. Does he not recognise, in this instance, that consistency is as important as Ministerial responsibility? With regard to the point made by the noble Lord, Lord Wigoder, Ministers change, and it is clear that their reaction to what may be similar incidents may be very different. Does the noble Lord not recognise that there would be a problem with different Ministers coming to different views on what would be an almost identical problem?
Lord LEATHERLAND: That could well be so. I can imagine various Ministers taking differing views on the same set of circumstances, with the same advocacy having been laid before them. But I have found exactly the same thing in the judiciary. I find it among the highest judges in the land, where one of them, on exactly the same evidence, overturns the decision of another at a lower level, who has heard exactly the same evidence.
Lord HARMAR-NICHOLLS: They are impartial.
The Earl of BALFOUR: Having given this matter quite a lot of thought, and having listened to the evidence, I prefer Amendments Nos. 231 and 232 standing in the name of the noble Lord, Lord Wigoder, and his noble friends. This is an improvement to Clause 25, and an important one. Equally, very definitely there must be a proper tribunal set up. But I am not certain I agree with the noble Lord, Lord Campbell of Croy, that there should be lawyers on it, provided—I say, "provided" with emphasis—that, whoever is taking part in this tribunal, whatever information is disclosed is kept secret throughout their deliberations. They will be dealing with extremely sensitive matters, and this is something we really must ensure. Therefore, I feel that a great deal of thought should be given
794
to this. Many of these Amendments are both necessary and worth while.
6.40 p.m.
Lord CAMPBELL of CROY: It is clear from the reply of the noble Lord, Lord Beswick, that the Government wish to leave this as a matter in which the Minister is the ultimate judge. What the Government have done is to make that subject to the Negative Resolution procedure in Parliament. That has leavened the original proposals, and I do not disagree with what the noble Lord said about the efficacy of that procedure, and indeed the Affirmative Resolution procedure, in keeping Ministers in check. What we say is that it is peculiarly inappropriate in this case. We should like to hear the noble Lord explain to us, if he can, how one can have a coherent and sensible debate, either in this Chamber or in another place, on the basis, for example, that the Minister has decided to disclose some information which the company, under subsection (4) at page 23, aver would cause injury to a number of employees of the undertaking. The information itself is still confidential and cannot be disclosed. The argument would be that the company apparently consider it so important as to insist that this would cause injury in that way.
No one in the debate can know what the information is, because the issue is whether it should be disclosed and made public. It would be very difficult for your Lordships, except for the Government Front Bench, who may not disclose the information, to follow what the debate is about. It would in the end presumably be governed by who were apparently powerfully supporting one case or another. One could only go by something like that, because nobody in your Lordships' House could in those circumstances know what is the information. So I am still most dissatisfied with that so-called safeguard, because although the system in general is a good one in this case, where no one knows what is the information that is being discussed and no one can be told, it seems quite inappropriate to add this to the procedure. Unless the noble Lord can add more to that, I must draw attention to that difficulty.
As regards the debate which we have had and the three courses which we have considered, personally I would think that

795
this gave us material for further thought and exchanges of views. I do not know whether the noble Lord, Lord Wigoder, will feel the same as regards his Amendment. We have now had a statement by the Government of their view. Unfortunately, they still insist that the Minister must take the final decision. The only qualification there concerns a debate, in either or both Houses of Parliament, which would be an extraordinary one and most inappropriate for a decision of this kind.
Lord SLATER: May I ask the noble Lord whether his Amendment is based on Scottish law as such or English law as such?
Lord CAMPBELL of CROY: I am glad to say that questions of law do not arise. If the noble Lord is looking at Amendment No. 294, which is a Schedule which would set up the proposed independent tribunal, he will see, as I explained, that it is based on one that exists already and has not produced any difficulties.
Lord WIGODER: There appear to be two quite separate issues upon which your Lordships have been expressing views in the course of this debate. The first is that if it is right that the Minister should be allowed to exercise his discretion on the issue as to compulsory disclosure, then the Bill should provide that on specific grounds that discretion can be challenged, but that the Minister's decision on the challenge to his discretion should then be final. There are very many of your Lordships who feel that it is entirely proper to give the Minister abundant discretion in the first place, but that if we are to set out specific grounds on which it can be challenged that should be referred for decision to an independent body.
The second division is clearly among those of us who believe that there should be an independent body but are not agreed among ourselves as to its nature, whether it should be an all legal body or a body of the type, as I would accept, set out by the Government in its existing Schedule 5. I would agree with the noble Lord, Lord Campbell of Croy, that there is clearly scope for further discussion between those of us who would wish to see an appeal body set up, with a view to establishing the type of body
796
which meets with general approval, and particularly, if I may echo the words of Lord Brown, which might command the support of the Government on reconsideration of this matter. Clearly the matter will have to be reconsidered at a later stage, and in those circumstances the best course at this stage would be to ask leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
The DEPUTY CHAIRMAN of COMMITTEES (Baroness Wootton of Abinger): I have to call the attention of the Committee to the fact that if Amendment No. 215A is agreed to I will not be able to call Amendments Nos. 216 to 221 inclusive.
6.47 p.m.
Lord DRUMALBYN Lord DRUMALBYN moved Amendment No. 215A:
Page 24, line 1, leave out paragraph (b).
The noble Lord said: I shall be very brief because we have already discussed the substance of this matter. The point here entirely is whether a representative of the trade unions should have the right of reference to whatever body we are going to set up. It seems to me that as the Bill is drafted the onus of convincing the Minister that trade union representatives should not get information lies with the company throughout. I have no doubt the company will ask the Minister not to require disclosure when it originally furnishes the information to the Minister. The Minister will then consider this, and before he delivers a further notice as to disclosure I understand that he is obliged to give an opportunity to the company to make representations and that also applies, as the Bill is now drafted, to the trade union representatives. I have suggested that is unnecessary, but that is another point to be dealt with at Report stage. Then if the Minister decides nevertheless to issue a notice under Clause 24, the company will have a right to require a reference to whatever body Parliament decides to set up.
What I am saying is that I find great difficulty in seeing why the representatives of trade unions should have the same right as the company, because the onus is on the company throughout. They are the people who know what the information is: they know how sensitive it is and so on. The Minister is in a position

797
to judge this up to the point of the reference, and then it goes outside. What would remain then would be this: if the company made a reference against disclosure where it was required to disclose by the notice, then the trade union representative would have the right to be heard at that stage. This seems to me to be sense. It cuts a great many corners. If you do it the other way round, the trade unionists will feel honour bound in most cases—I do not say all; the noble Lord, Lord Davies of Leek, indicated a case where they might not be inclined to do so—to require a reference to the advisory body or appeal body or whatever it is.
I know that the Government have been at the greatest pains to achieve a balance here, but balances are not always necessarily fair. There is something different here. I think they have been worrying too much about the verbal balance without a real balance in this matter. As I say, the Bill clearly intends that the information should be disclosed unless the Minister is satisfied that disclosure is not desirable, either in the national interest or for special reasons. On these special reasons, I do not myself see why the trade union representatives should have a right to appeal where they do not know anything more than the broadest outline of the nature of the matter, and know nothing about the detail of it at all, which is the essence of it. You cannot argue with that. I think this would be a sensible Amendment, even though at first sight it may appear not to be fair because both sides are not getting the same treatment; but then both sides are not getting the same treatment throughout, as I have already explained.
Lord LEATHERLAND: Do we understand, in view of the discussion on the last Amendment, that the ultimate power is to be taken out of the hands of the Minister and placed in the hands of a legal court, and that in that legal court the trade unions shall not have the right to appear as a plaintiff, whereas the employers shall have the right to appear as a plaintiff?
Lord DRUMALBYN: I have explained the reason for this. It is so easy to present this as a balance in this case, but there is not a balance. The
798
situation is quite different. All along it is the companies that have had to prove that there should not be disclosure.
Lord PANNELL: In about 50 years in the trade union movement, I have always heard the argument that somehow it has nothing to do with the employees, even though it might affect every part of their lives, and may involve considerations on which the trade union representative, because of a national connection would have a better view. I heard the previous argument, particularly from the noble Lord, Lord Harmar-Nicholls, as if there was some infallibility about lawyers. My experience of lawyers is that they always think that words have some significance beyond their meaning, and when you see the product of it at the end you wonder what this ugly duckling is; it has no practical application at all. These things are not of great moment; they would happen under the day-to-day application of the Bill where an employer is not satisfied, and it is quite reasonable then that the responsible trade union should be in with equal rights from the beginning. We have been fighting this for 50 years. It is only in the House of Lords that we would hear that argument put up again.
Lord HARMAR-NICHOLLS: I do not think that the noble Lord understood what my noble friend made perfectly clear; that is, that since it would only be the employers in this case who would know that there ought to be an appeal, they should be the ones who ought to take the active steps to set it on the move, and the tribunal, or whatever body we eventually agree, would be looking after the interests of the trade unions in this sense. It is rather sad that even inadvertently the noble Lord should bring about the one side as against the other for apparently ulterior motives based on 50 years of history which in this instance have no relevance whatsoever.
It is exactly the same as comparing the tribunal with the Lords of Appeal disagreeing with a lower court. The difference in what I was arguing then, and the point made by the noble Lord, is that both are known to be impartial and objective. They have no axe to grind. Therefore, you would accept a different view from somebody who is equally impartial. I am quite certain that if the

799
noble Lord will read what my noble friend has said he will see that in what he is suggesting the trade unions are amply and properly looked after, as they should be.
Lord MELCHETT: The provisions relating to references to the advisory committee must be fair to both sides concerned, and that is what in our view, and, I am glad to say, in the view of my noble friends who have opposed this Amendment, paragraph (b) provides for. The committee is there to advise just as much on what information can be disclosed without causing substantial injury as to what cannot, and the right to demand that Minister's decisions should be referred to it should, in the interests of fair play, extend to both the company concerned and to the trade union representatives. It is very important that the powers should be seen to be used openly and fairly if they are to succeed.
If the Amendment were accepted, a patently unfair situation would arise which would hardly be conducive to good industrial relations. The impression would be created that the advisory committee was there simply to serve the interests of employers, and as a check on the Secretary of State—or, equally damagingly, that the decisions about the disclosure of information were settled privately between the company concerned, the Minister, and the advisory committee, since trade unions were denied access to the machinery which helped settle disputes about the information to be disclosed. A climate of suspicion and distrust on the part of the trade unions would tend to grow up around the use of the information powers if this paragraph were deleted. The noble Lord, Lord Drumalbyn, said that balance was not necessarily fair, but the most important thing in our view is that the balance should be seen and thought to be fair by all the parties involved, and that includes the trade unions.
Lord DRUMALBYN: I appreciate the force of what the noble Lord has said. The whole tenor of this part of the Bill is to secure that the trade unions will get information wherever it can possibly be obtained without damage to the undertakings themselves and the workers themselves. The question is how best to
800
arrive at that: whether we have the cosmetic business of being fair to both sides and putting in the same provision on each side. Whether or not that is really going to convince the workers that this is right, I do not know.
The noble Lord argues, in effect, that if it is to be accepted by the trade unions, it is necessary that they must have equal rights throughout, although the whole tenor of this part of the Bill is that the unions should have the information unless the company makes a good case against it. There is some muddled thinking on the part of the Government on this, and in what the noble Lord has expressed. I hope they will look at it again. It will cause a great deal of needless waste of time. In almost every case the trade union would be likely to make an appeal if the appeal is there, and this would be nonsense. I do not intend to pursue the matter now. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord MELCHETT: I beg to move Amendments Nos. 218A and 218B en bloc. I spoke to both of these with Amendment No. 163A.
Amendments moved—
Page 24, line 1, after ("the") insert ("authorised")
Page 24, line 3, after second ("to") insert ("authorised").—(Lord Melchett.)
6.58 p.m.
Lord CAMPBELL of CROY moved Lord CAMPBELL of CROY moved Amendment No. 219:
Page 24, line 3, leave out from second ("to") to ("for") in line 4 and insert ("all employees and shareholders").
The noble Lord said: When we discussed earlier in our proceedings Amendments in the name of my noble friend Lord Aberdare and myself involving "all employees" and "representatives of all employees", I said that when we came to this Amendment we ought to have a separate debate because we have brought in "shareholders". The Amendments which go with this one and would be discussed at the same time are Amendments Nos. 223, 236, 247, 252, 255, 259 and 260. They will all be dealt with when we have had this debate.
The noble Lord, Lord Terrington, and my noble friend Lord Cullen have already

801
raised the position of shareholders in earlier debates, and have pointed out the requirements that they be given information in certain circumstances. These are existing requirements of Stock Exchange rules and laws. In this Amendment I have used the word "shareholders" because everyone can recognise clearly what is meant by that, but the Amendment by the noble Lord, Lord Terrington, used the term, "members of companies". That may well be correct in the drafting of the Bill, and I recognise that that might have to be used in any Amendment which is finally drafted.
I want now to draw attention to a problem, and there is a problem; companies on the Stock Exchange enter into a listing agreement which places obligations on directors not to divulge price-sensitive information to a restricted group of persons. Under the Bill as drafted, information under this compulsory system would go to certain trade union representatives, and they may or may not pass it on, so that it is in a semi-public state. Under the voluntary system which already exists, companies have to decide whether certain information is price-sensitive, and they can then decide whether to make it public or not to disclose it at all. The information which we are now discussing is additional to that covered by the rules for annual reports and accounts, raising additional capital and intended acquisitions.
As drafted, the Bill places a special new burden on the directors of companies to decide whether certain information is price-sensitive. Although it has been cleared as regards confidentiality through the advisory committee, taking into account special reasons under Clause 24, it could still be price-sensitive in the view of the directors. The representatives of trade unions could, if the information were disclosed, be placed unwittingly in a potential insider trading position and, technically, it would then be necessary for prohibition against dealing in the company's securities in the way that has been prescribed in other situations of the same kind.
I must, therefore, ask the Government whether they are relying on the listing agreement and are leaving it to the boards of companies to have to decide what to
802
do in individual cases. Rather than that the information should become semi-public, we believe that the Bill should make it clear that when the information has emerged from the advisory committee procedure and what follows it, it should be available to all employees and also to shareholders. The Government have agreed in earlier debates that the information at that stage, when it has been cleared and screened, should no longer be regarded as confidential. On Friday, when this question of shareholders was raised, the noble Lord. Lord Beswick, suggested that this should be included in some future Companies Act, coming forward in a Companies Bill; but I believe that the Stock Exchange consider that this should not be postponed until then, because this Bill will come into force a great deal sooner than that could happen. I do not know whether the noble Lord. Lord Beswick, wishes to say more today, but I certainly think that this matter needs to be dealt with, perhaps on Report. I do not intend to press this Amendment now, as the noble Lord and the Committee know, but this is a serious problem which will need thought at some stage before the Bill is completed.
Lord BESWICK: I understand why the noble Lord, Lord Campbell of Croy, has raised this matter although I thought we had settled this, for the time being at any rate, when we discussed the issue on an Amendment moved by the noble Lord, Lord Terrington. The answer I gave to that noble Lord was that while I was in favour of giving the maximum amount of information to the shareholder, this was not the Bill in which the shareholder's rights should be dealt with. That should be dealt with in separate legislation and I instanced, as the noble Lord, Lord Campbell, said, the possibility of a new Companies Bill. But I gather from what has been said that there persist doubts with the authorities of the Stock Exchange, and certainly if those doubts could be expressed again I should be happy to ensure that they are considered.
The noble Lord asked about the Listing Agreement and I emphasise that this Bill in no way infringes the duties placed on a quoted company by a Listing Agreement. The information passed to trade union representatives may be price-sensitive and if the information was so

803
sensitive that disclosure would not only create problems in the City but damage the interests of the country, it would be covered by the earlier clause, where a company would say that it would cause injury, and then the information would not be given either to the trade unions or, by extension, to the shareholders. But, where there was no question of any injury being done to anybody, if information even of a price-sensitive kind were given to the trade unions, then that information can freely be published to all others, including the shareholders, so there is no question of any restricted insider groups. I should have thought that the situation would be welcomed, but if there are reasons for any other special concern I shall be happy to see that they are considered.
Lord CAMPBELL of CROY: I am grateful to the noble Lord, Lord Beswick, for that further statement today. I should make it clear that this is not so much a question of the rights of shareholders as a new problem and, as I said, added burden for the boards of companies having to deal with certain information in a different category and status from that which they have been dealing with under the voluntary system. It seems that the noble Lord is relying at the moment on the Listing Agreement. He says there is nothing in the Bill which stops its effect. That is not so much the point as the fact that the boards of directors will have still to be guided by that Listing Agreement. Of course, the case I was considering was where injury to the company had not been proved but, nevertheless, price-sensitive information might be emanating as a result of the information becoming semi-public or public. We shall probably have to revert to this at later stages of the Bill and, in the meantime, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
The DEPUTY CHAIRMAN of COMMITTEES (Baroness Wootton of Abinger): In calling Amendment No. 222A I have to inform the Committee that if this Amendment is agreed to I shall not be able to call Amendment No. 223.
7.8 p.m.
Lord MELCHETT: I beg to move Amendment No. 222A. This was discussed with Amendment No. 163A.
Amendment moved—
Page 24, line 7, after ("to") insert ("authorised").—(Lord Melchett.)
Lord MELCHETT: I beg to move Amendment No. 229A, which was spoken to with Amendment No. 163A.
Amendment moved—
Page 24, line 11, after ("union's") insert ("authorised")—(Lord Melchett)
The DEPUTY CHAIRMAN of COMMITTEES: The next Amendment I have to call is No. 230.
Lord CAMPBELL of CROY: My Lords—
Lord BESWICK: If, as I gather he does, the noble Lord, Lord Campbell of Croy, proposes to speak to Amendment No. 230, I suggest that this might be a convenient moment for the Committee to adjourn. I therefore beg to move that the Committee do adjourn until 8 p.m. and that the House do now resume.
House resumed.

MEDICINES (FEEDING STUFF ADDITIVES) ORDER 1975
7.10 p.m.
Lord STRABOLGI: My Lords, I beg to move that the draft Medicines (Feeding Stuff Additives) Order 1975, laid before the House on 4th July, be approved. The Order is intended to correct several anomalies in the Medicines Act 1968, to enable us to exercise full control over the sale, supply, import and labelling of medicated animal feeding-stuffs and over the sampling and analysis of these feedingstuffs for enforcement purposes. The Medicines Act contains provisions relating to the general control of medicated animal feedingstuffs—that is animal feedingstuffs in which medicinal additives have been incorporated.

805
The medicinal additive may be a medicinal product as defined in Section 130 of the Act or it may be a substance which, although not a medicinal product as defined, nevertheless has been incorporated in the feedingstuff for a medicinal purpose. This latter expression is also defined in Section 130. It might help to make this difference clear if I take copper as an example. Its derivative copper salt is frequently added to pig feed as a growth promoter. The copper salt is not itself a medicinal product, but under the Act such an addition is for a medicinal purpose.
The Agriculture Ministers propose shortly to make regulations which will deal with the manner in which samples of feedingstuffs are taken and analysed for enforcement purposes. In addition, an order will be made prescribing limits of variation. The enforcement regulations to which I have just referred will apply to all medicated feeds, whether the medicament is a medicinal product or a substance incorporated for a medicinal purpose. But the Act empowers Ministers to make orders prescribing tolerances only in respect of feedingstuffs containing medicinal products, and makes no provision for tolerances for feedingstuffs containing substances, such as copper, incorporated for a medicinal purpose.
Turning to a different matter, the provisions of Sections 40 and 42 of the Act relate to general control over medicated feedingstuffs. Under these sections, licencing controls are imposed on the incorporation of medicinal products in feedingstuffs, and on the sale and import of feedingstuffs so medicated. The incorporation of substances such as copper into feeds is also controlled under these provisions, but not the sale and import of feedingstuffs containing substances incorporated for a medicinal purpose. The Order now before your Lordships' House will remedy this deficiency.
There is one further provision in the Order. In 1973 your Lordships' House approved a similar order (The Medicines (Feeding Stuffs Additives) Order 1973 No. 1164) which extended the requirements for the labelling of medicated feedingstuffs so that they apply to feeding-stuffs containing substances incorporated for a medicinal purpose as well as to those containing medicinal products. The Order now before your Lordships' House
806
revokes and re-enacts the earlier one. To summarise, therefore, the Order covers all the provisions in the Act which the agriculture Ministers wish at this time to apply to the substances I have described.
As the Act requires, a number of organisations representing interests likely to be substantially affected have been fully consulted, not only on this Order but on the proposed enforcement regulations and limits of variation order, and have raised no objection. The Veterinary Products Committee, established under Section 4 of the Act to advise Ministers on veterinary medicines, recommends that the Order be made. I beg to move.
Moved, That the draft Medicines (Feeding Stuff Additives) Order 1975, laid before the House on 4th July, be approved.—(Lord Strabolgi.)
Lord SANDYS: My Lords, the House will be grateful to the noble Lord, Lord Strabolgi, for introducing the Order and for explaining it in such detail, particularly in view of the fact that he quoted so striking an example as that of copper salt. We on this side of the House strongly support the Order.
I have two questions which I should like to ask. First, the powers in Section 117 of the parent Act—the Medicines Act, 1968—empower the agriculture Ministers to make regulations. The noble Lord referred to the fact that regulations are to be drafted and my question is as follows: are the agriculture Ministers in Brussels to be consulted when we are drafting our own regulations, and, broadly, are regulations in this field coordinated in the EEC as a matter of practice?
Secondly, can we be assured that at the present moment standards in use in the Common Market are on a parallel basis? I have said that we on this side of the House support the Order. It is clearly beneficial, particularly in view of the fact that I understand that more than 23 organisations have been consulted and have raised no objection
Lord STRABOLGI: My Lords, I am very grateful to the noble Lord, Lord Sandys, for the welcome he has given to the Order. The noble Lord raised the question of the EEC standard. I understand that the Community standard permits the use of 125 parts to a million of

807
feed, while the United Kingdom standard permits the use of up to 200 parts. There is therefore, some difference. We have filed a case at Brussels for increasing the EEC standard, and this will be discussed in the autumn.
With regard to the regulations, Section 117 of the Medicines Act is concerned with enforcement and is not therefore the concern of Brussels. I am glad that the noble Lord referred to the number of organisations which have been consulted. As he said, these number some two dozen. There is also the Veterinary Products Committee, which is a committee of veterinary, medical and other scientific experts whose terms of reference are to give advice with respect to safety, quality and efficacy in relation to veterinary use of any substance to which the Medicines Act applies, and to promote the collection and investigation of information relating to adverse reactions to veterinary medicines. The distinguished chairman is Professor Grunsell of the Bristol Veterinary School. I hope this clears up the points about which the noble Lord was asking.

DISEASES OF ANIMALS (AMENDMENT) (NORTHERN IRELAND) ORDER 1975
7.20 p.m.
Lord DONALDSON of KINGSBRIDGE Lord DONALDSON of KINGSBRIDGE rose to move, That the draft Diseases of Animals (Amendment) (Northern Ireland) Order 1975, laid before the House on 2nd July, be approved. The noble Lord said: My Lords, I beg to move that the Draft Diseases of Animals (Amendment) (Northern Ireland) Order 1975 be approved. The Order seeks to extend the Diseases of Animals Act (Northern Ireland) 1958 to make provision for more effective controls to prevent animal disease being introduced into Northern Ireland, and to prevent the internal spread of disease there by regulating the distribution and use of things which are capable of transmitting infection. Certain provisions imposing financial obligations on the Department of Agriculture will also be repealed by the Order.
New import controls are provided for in Article 3. Included is a general power enabling regulation of the import of anything which is capable of transmitting animal or poultry disease. Orders made under this power may apply conditions to the import of a much wider range of items than are covered by existing powers; for example, it will be possible to insist on cleansing and disinfection before used agricultural machinery may be imported. To date the Department has had to rely on voluntary co-operation in this sphere and this has not always been forthcoming. The import of dirty machinery could result in the introduction of serious animal disease.
Under paragraph 2(b) of Article 3, unlicensed imports may be detained on board the vessel or aircraft in which they are conveyed to Northern Ireland and such consignments may be re-exported without being allowed to land. Present legislation extends only to cargoes that have already landed, but the landing of an unlicensed cargo of meat, for example, could in itself constitute a serious threat to Northern Ireland's long history of freedom from diseases, such as foot-and-mouth disease, swine fever and swine vesicular disease. Contaminated material could, for example, be carried off by birds or vermin and this could lead to livestock being infected.
If inspectors are to be in a position to detain unlicensed consignments on board, they must have powers of entry to enable them to check that no such consignments are being carried. Consequently, paragraph 3 of Article 3 extends existing powers of entry so that inspectors will no longer be required to have reasonable grounds for suspicion that the legislation is being infringed before searching the vessel or aircraft. Paragraph 4 makes it an offence to be in possession of anything which has been imported in contravention of the diseases of animals legislation. However, if the person charged with such an offence can satisfy the court that he was unaware the thing concerned was unlawfully imported, having taken reasonable precautions to check that this was so, then the charge will be dismissed. The final paragraph of Article 3 extends the powers of the Department in relation to animals and poultry in quarantine, to allow re-export of livestock which have

809
been in contact with diseased stock or which, for some other reason are suspected of being diseased. At present the Department only has power to slaughter such stock.
Article 4 permits the Department to control the movement and use of anything which is capable of transmitting animal disease—including disease-causing organisms themselves. It also permits the exercise of health and hygiene controls over establishments, such as knacker yards and poultry waste processors, which can constitute a potential health risk if proper standards are not maintained. Article 5 gives the Department power to require persons dealing in livestock, poultry and their products to keep documents and records of their stock and transactions. The Department may require production of such documents and where necessary in exceptional circumstances, shall have the power to remove the documents. Recent experience has shown that, in order to trace the movement and origin of illegal imports, the Department must have access to this type of information. The information could also be useful in tracing the origin of an outbreak of disease.
Turning now to the financial provisions which I mentioned earlier, Article 6 removes the Department's liability for the payment of compensation for imported animals which have been slaughtered in quarantine because they are diseased or suspected of being diseased. The philosophy behind this change is that the importer, and not the taxpayer, should be liable for the risks involved in importing animals.
Finally, Article 7 repeals an outdated provision under which the Department is liable for the partial reimbursement of expenses incurred by local authorities under the Diseases of Animals Act. In fact, local authorities in Northern Ireland no longer have any specific obligations under this Act, and the total amount that has changed hands under this heading in the past 10 years has been £3½25. As I have already mentioned, Northern Ireland has a very good animal health record. Its agricultural export trade depends largely on its freedom from the more serious diseases of livestock and
810
poultry. Measures incorporated in this Order are largely designed to protect the Province's animal health status and to ensure thereby the security of the agricultural industry in Northern Ireland.
Moved, That the draft Diseases of Animals (Amendment) (Northern Ireland) Order 1975, laid before the House on 2nd July, be approved.—(Lord Donatdson of Kingsbridge.)
Lord BELSTEAD: My Lords, it is clear from the explanation given by the noble Lord that this Order should be supported. Probably the noble Lord can, like myself, remember past occasions when there have been terrible outbreaks of foot and mouth in the United Kingdom, and there have been long debates in this House about the most effective means of trying to combat that disease. Having listened to the noble Lord, it seems clear to me that this Order moves decisively towards more practical and stronger controls from the point of view of animal health.
I wish first to ask the noble Lord a question, notice of which I regret I have not given him because it arose in my mind only as he was speaking. It is clear that as a result of this Order some extra responsibilities will fall upon the farmer, the producer. The noble Lord mentioned the responsibility in importing carcasses for those who do the importing. Can the noble Lord say whether the provisions of this Order have in fact been agreed with the Northern Ireland farmers' union? If they have not been agreed, does the noble Lord know from his experience whether there are any areas of the Order which are in contention? The noble Lord might care to write to me on this point, which can certainly await a written reply.
Secondly, can the noble Lord give me any reason for strengthening the law in the main respect in which the Order strengthens it; namely, in making it an absolute offence—more or less—for anyone who is in possession of anything which has been imported in contravention of an Order under the parent Act? This is a matter to which the Joint Committee on Statutory Instruments drew attention. The point which the Committee raised is of no account this evening; it led the Committee to no conclusion, but from it

811
arises my question. This Order is strengthening the law against those who might contravene an Order under the parent Act, and I should be interested to know whether historically in the past few years there has been any record of contraventions of the law. In particular, have cases of illegal importing increased in respect of any specific animals?
Finally, I wish to ask the noble Lord about Article 5. I may be misreading this article, and it may apply only to the movement of carcasses, but as I read it, it seems to apply to the movement of live animals. If this is so, I find it astonishing, because such records have been obligatory for many years in Great Britain, and therefore surely in Northern Ireland, where agriculture specialises in the raising of livestock, it is extraordinary that records should not have been required in the past. Having posed those three questions, I wish to say that I very much support the direction in which the Order moves. If there were a bad outbreak of swine vesicular disease, foot and mouth, or swine fever—three matters which the noble Lord mentioned—we should probably be having a lengthy debate. In my opinion the methods outlined in the Order are right and should be supported.
Lord DONALDSON of KINGS-BRIDGE: My Lords, I am most grateful to the noble Lord for the welcome he has given to the Order. First, it is not an Order which has a great deal to do with the primary producer; it is much more concerned with the meat plants and the people who handle dead meat. But, in fact, the provisions have been agreed with the Ulster Farmers' Union—a point which the noble Lord asked me about. He also raised the question of the absolute offence. The view taken was that it is very difficult for a prosecution to prove ignorance that meat has been imported; but provided the possessor of meat which has been imported is given a reasonable opportunity to explain why he did not know—and there are very many reasons why this might be so—this was thought to be the fairest way to deal with the matter. It arose not as the noble Lord suggested through some unexpected increase in imports but through rather an important case which arose, I think, during the course of the past 12 months
812
where a fairly large quantity of imported meat was found. It was extremely difficult to lay the blame on the people who were holding it until, at the end, one of them admitted to having imported it.
In this case it was dealt with, but without the free admission of this person it was realised that prosecution would be very difficult, and this has been put in to make it easier. I think there is a precedent for doing things this way round, and the best example I can give the noble Lord is one from Northern Ireland. Under Section 110 of the Fisheries Act (Northern Ireland) 1966 it is an offence to be in possession of salmon illegally caught—a similar cases. The defence is described in identical terms to Article 3(4), so that I am quite satisfied, and I hope the noble Lord will be satisfied, that this is not creating some new and terrible crime. It is making a logical position in order to prevent what we are all determined to prevent.
In regard to Section 5, the noble Lord expressed surprise that it was necessary to give the Department or the inspectors power to insist on record keeping. The answer is that there are a number of regulations which insist on record keeping. This is a blanket regulation which gives them power to insist on any record keeping and also goes a good deal further by giving them the right, which is not available generally, to take away the records, if necessary. I hope that those answers will satisfy the noble Lord.
[The Sitting was suspended from 7.33 p.m. until 8 p.m.]
8.0 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 230:
Page 24, line 13, at end insert—
("Provided that the committee shall ensure that such representations shall be made in a manner preventing disclosure of any of the information or substance thereof otherwise than to the committee.")
The noble Lord said: This Amendment is designed to inquire about the confidentiality of the advisory committee proceedings. I think it can be assumed that the proceedings should be confidential and that the information itself, which no doubt will have to be made clear and

813
divulged to the members of the Committee, should be protected. The question also arises of whether this should be written into the Bill in the form of this Amendment or something like it so that everybody who reads this subsequently as an Act is informed that the proceedings will be confidential.
May I give an example of what I assume will happen? When the advisory committee gives the representatives of the company and of the trades union the opportunity to make representations under the preceding subsection, one assumes that they will be seen separately so that the company can talk about the information (which is the subject of the question, whether to disclose or not) and the members of the advisory committee will then be aware of what the information is. Subsequently, the trades union representatives make representations and, it may be, see the committee and are received and make oral representations if that is within the procedure. We assume that the advisory committee must then be careful that the trades union representatives are not inadvertently given some of that information. There is also the general point that anything that is learned by a member of the advisory committee should be confidential. That is why I beg to move this Amendment.
Lord MELCHETT: We entirely agree the principle underlying this Amendment. I can assure the noble Lord that the assumptions he makes are more or less in line with practice, and in line with the practice as already outlined by the Government in another place in response to an earlier discussion on this matter. As a result of that discussion the Government indicated how they saw this information being kept confidential. It was felt that any argument that would occur with both sides present would be a general argument about types of information that might be withheld. In closed session the company would then submit to the committee that certain information should not be disclosed because it fell into a particular category.
This, and the provision in paragraph 6 of Schedule 5 that the committee will sit in private, provides a complete assurance that the information will be safeguarded. Were the committee or any of its mem-
814
bers to release information by design or by accident—and this answers the point the noble Lord made about inadvertent disclosure—this would be an offence under Clause 28(3) which would be punishable by fine and imprisonment. For these reasons, while we accept the principle underlying the noble Lord's Amendment, I hope that he will see that it is unnecessary as it is already embodied in the provisions of the Bill.
Lord CAMPBELL of CROY: I am glad to have that assurance, and grateful to the noble Lord for giving it. As at present drafted I would not say that it would be easy for someone examining the Bill when it is enacted to reach the conclusion leading to the assurance we have been given. I still think it might be worth examining whether this could not be written clearly into this part of the Bill. The fact that a member of the advisory committee would be committing an offence by breaching this confidentiality is something which, having been stated by the Minister, should give a real assurance to those who are following these proceedings. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord MELCHETT: This Amendment was discussed with Amendment No. 163A. I beg to move.
Amendment moved—
Page 24, line 24, after ("the") insert ("authorised")—(Lord Melchett.)
Lord MELCHETT: This Amendment was discussed with Amendment No. 163A. I beg to move.
Amendment moved—
Page 24, line 28, leave out ("a representative of each relevant trade union"), and insert ("each such representative ")—(Lord Melchett.)
8.7 p.m.
Lord TERRINGTON Lord TERRINGTON moved Amendment No. 239:
Page 24, line 28, at end insert ("and to the members of the company or companies concerned")
The noble Lord said: Although I made reference to this Amendment when

815
speaking earlier to Amendment No. 185, I should like to say a few more words. The noble Lord, Lord Beswick, assured me that he recognised the point I was making with regard to disclosure to shareholders. For this I am grateful. He also expressed the hope that I will accept the Government point that this Bill was not the vehicle through which to make changes of the kind I am proposing. I entirely accept that a Companies Bill would be a more normal method of dealing with the position of shareholders and I said so at the time; but I am still uneasy about the delay involved in waiting for a Companies Bill. In order to obtain their further views, I am therefore having some fresh discussions with the Stock Exchange authorities who have expressed their concern about this. In the meantime I should like to reserve my position for a later stage in this Bill. I beg to move.
Lord BESWICK: I understand what the noble Lord, Lord Terrington, says. If any new points arise from the more recent discussions which the noble Lord has with his colleagues, I shall be glad to consider them. I hope that he will consider what we have said; namely, that there can be absolutely no question of having a restricted number of insiders here. Once information has been disclosed, we should be happy to have it fully disclosed to all the shareholders. We shall see what the noble Lord has to say later. If he cares to let me have a note on what lines he is thinking, I will ensure that the points he raises are carefully considered.
Lord TERRINGTON: I thank the noble Lord and beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Lord MELCHETT: Amendment No. 241A was discussed with Amendment No. 163A. I beg to move.
Amendment moved—
Page 24, line 30, laeve out "representative of each relevant trade union") and insert ("authorised representatives")—Lord Melchett.)
Lord LOVELL-DAVIS: I beg to move Amendment No. 246A. Reference
816
was made to this with Amendment Nos. 246B and 163A.
Amendment moved—
Page 24, line 35, after ("union's") insert ("authorised").—(Lord Lovell-Davies.)
Lord LOVELL-DAVIS: I beg to move Amendment No. 246B. Reference was made to this with Amendment No. 163A.
Amendment moved—
Page 24, line 41, leave out ("a") and insert ("the authorised").—(Lord Lovell-Davis.)
Lord LOVELL-DAVIS: I beg to move Amendment No. 251A. This Amendment was discussed with Amendment No. 163A.
Amendment moved—
Page 25, line 3, after ("the") insert ("authorised").—(Lord Lovell-Davis.)
Lord LOVELL-DAVIS: I beg to move Amendment No. 254A. This Amendment was discussed with Amendment No. 163A.
Amendment moved—
Page 25, line 10, leave out ("the representative of each relevant trade union") and insert ("each such representative")—(Lord Lovell-Davis.)
Lord LOVELL-DAVIS: I beg to move Amendment No. 258A. This Amendment was discussed with Amendment No. 163A.
Amendment moved—
Page 25, line 24, after second ("to") insert ("the authorised")—(Lord Lovell-Davis.)
Clause 25, as amended, agreed to.
Clause 26 [Confidentiality]:
8.14 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 262:
Page 25, leave out lines 29 and 30.
The noble Lord said: This Amendment seeks to delete paragraph (a) at the

817
beginning of Clause 26. This clause refers to information which is to be disclosed to the Minister but not to trade union representatives. It appears to lay down the degree of confidentiality attaching to that information. The Minister is to retain, under Clause 23, this information as useful to him, whether it be for the purposes of planning agreements or any other legitimate reason. We have recognised in earlier debates that Government Departments receive in any case confidential information from companies. This is well protected and guarded. Here they are being compulsorily required to provide information to the Minister some of which may well be highly confidential. We see no difficulty about what I have described so far. What we are seeking, in moving this Amendment, is what possible objection there could be to obtaining the company's consent before the Minister passes information to other Government Departments.
It may be for the convenience of the Committee if I also refer to a similar Amendment, No. 265, at this stage in which we are also seeking reasons as to why the company's consent should not first be obtained before this information is passed to three Agencies which are named in paragraph (c). I suggest blanket consent could usually be obtained for the great majority of information which is not highly sensitive by the Minister when he receives information from a company saying that he asks for the company's permission to pass it to other Government Departments or these three Agencies. In that way the sensitive information can be identified because the company may say: "That is fine, but there are two or three matters which are very sensitive and we would ask you to contact us before you pass those points on." I sincerely hope that the company will be informed, because it looks from this clause as though the company will not be informed if the Minister decided to circulate some information round Whitehall, and not only Whitehall, but Cardiff, Edinburgh, Newcastle and other places where Government Departments reside.
Having been in the Government service as a professional civil servant and diplomat, and having occupied positions where secrets and top secret information
818
were the daily business, I am aware of one of the principles which used to operate, and I think still does, in the Government service; that is, the need to know. If there is something confidential or secret, one of the best ways of preserving it in that state is to ensure that only those people who need to know are told it.
Having been, due to my job, a repository of a great deal of such information, I have been in the position of saying that I did not want to know anything more than I needed to know. That does not arise in this case, but I put forward the principle to the Government which is an established principle in the British Government service—that restricted and confidential information should not be passed to people who do not need to know it. That is the way in which a leak can occur inadvertently, because someone forgets where he happened to learn some information. Our purpose is to make sure a company is asked for its consent either in blanket form at the beginning when providing the information, or later if it states it would like to reserve a position on certain sensitive items and be asked individually on those. I should be glad to hear the views of the Government on this.
8.20 p.m.
Lord BESWICK: In the first place. I have to state that the purpose of obtaining information is of course to be able to use it. It would be wrong—and I am not certain the noble Lord wishes to achieve this objective—if the Minister or Secretary of State obtains information that he cannot discuss even with his own officials. That would be the effect of the noble Lord's Amendment. Although I accept what he says about the need to know principle, it is almost certain that there will be other Government Departments—for example, the Department of Employment or it could be the Department of the Environment—which would be concerned with the kind of problem with which we are hoping to help. This information clearly ought to be available to that Department. I hope therefore the noble Lord will agree on consideration that it would be an unwise restriction upon the exercise if we said that it could not he passed to Government Departments.

819
I should however—and I hope that this will be of some assurance to him—say that the National Enterprise Board are not a Government Department and there is no question whatsoever of information obtained under Clause 23 being passed to the NEB while it remains confidential. Apart from that, it goes only to Government Departments and it goes to them under the same conditions of confidentiality that are imposed under Clause 26(1). The noble Lord also asked me in relation to Amendment No. 265—and I gather he would like to clear up this point on this occasion—why reference was made to the Manpower Services Commission, the Employment Services Agency and the Training Services Agency. It is because these Agencies perform functions which are in many ways analogous to functions discharged by Government Departments in the past. Under the Employment Training Act 1973 they were given the status of bodies outside the Government and would not therefore be covered by the reference to Government Departments in Clause 26(1)(a). On the other hand, the noble Lord will appreciate that if we are dealing with development of industry, it is precisely these bodies which will probably have a constructive role to play, and again the confidentiality clause will apply to them and all the penalties attached to improper disclosure would also apply to those who are now employed by these Commissions and Agencies. With that explanation, I hope the noble Lord will see fit to withdraw his Amendment.
Lord CAMPBELL of CROY: I am grateful to the noble Lord for what he has said. Of course I was not intending in this Amendment that a Minister should not be able to discuss information with his officials in his Department. What we are concerned about is the information being spread to many Departments, not perhaps necessarily. The noble Lord has made it clear that this is not the intention. I would hope that in the working of this the Government would be sensible in obtaining blanket consent when the information was first furnished, identifying in the way I suggested with companies what was harmless and what they hoped would be restricted to those Departments which needed to use it. Of course, I agree that where Departments need the
820
information for use it should go to them. But there can be a rather casual way of informing everybody about things in Whitehall, and it ought not to apply in the case of information obtained under this clause. I beg leave to withdraw this Amendment.
Amendment, by leave withdrawn.
8.25 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 267:
Page 25, line 43, at end insert—
("nor shall any such information be disclosed or used without the consent aforesaid for furthering the interests of any person other than those of the person furnishing it or any subsidiary of that person.")
The noble Lord said: This is another suggestion on which we should like to hear the Government's views concerning obtaining consent of a company. We believe it would be prudent to obtain the Government's permission before any of this information be disclosed or used for furthering the interests of any other person than the company or subsidiary of the company. There could be acrimonious relations developing between the Minister and the company if the company suffered because competitors had learned information indirectly as a result of disclosures to the Minister. I realise that this would be entirely unintentional, but it is the company which would know whether the wider disclosure of some information might lead to a situation of damage to it. Here again, we suggest that the Government's practice in a situation of this kind should be to ensure that they have the consent of the company before passing on the information. I beg to move.
Lord MELCHETT: There is no question of information passed by the Minister to any of the bodies listed in Clause 26(1) being passed beyond those bodies while the general confidentiality provision applies. Provided that the company has not been convicted of an offence under Clause 28 the ban on disclosure of information will remain until disclosure has been made to union representatives subject only to the proviso that the Minister will, if necessary, be able to release information in connection with the investigation or prosecution of an offence under this Bill. There is therefore no need, in our view, to impose

821
confidentiality restrictions since these already apply.
The Amendment, as I understand it, is concerned with more than just confidentiality. It would prevent the Minister from disclosing or using any information without the company's consent for the purpose of furthering anybody's interests other than those of the company providing the information. In general our view is that this would be extremely restricting, in that it might well prevent the information from being used for purposes of general economic planning where the benefits were not primarily to accrue to the company but to the economy in general. It would certainly prevent the information from being used, as we believe we must preserve the right to use it, if necessary, for the purpose of preparing and prosecuting an offence. I do not believe that this would be the most important use of information provided in this way, but we must be able to use it in this way as a last resort. This would clearly not be in the direct interests of the company and would thus be excluded by the Amendment.
Lord CAMPBELL of CROY: What the noble Lord has said indicates that the Government do not think this provision need be written into the Bill. What matters is the practice which the Minister will institute when this Bill is enacted and the way in which he deals with companies. There certainly will be situations where he will have the cooperation and confidence of the company if he has obtained their consent to dispersing the information to other parts of the Government machine. So perhaps it is a matter of the administrative way in which this matter is handled, rather than writing something into the Bill. But I should like to draw attention to the importance of this kind of point and, at the same time, beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 268:
Page 25, line 43, at end insert—
("( ) Where information to which this section applies has been disclosed by virtue of one or more of the exceptions set out in subsection (1) above being information which is not generally available but, if it were, would be
822
likely materially to affect the price of any securities, a person receiving that information shall not deal in those securities or procure any other person so to do so long as that information is not generally available and is information to which this section applies.")
The noble Lord said: This is an interesting point arising from the debates which we have had on the Amendments of the noble Lord, Lord Terrington, and also an Amendment which I moved a little earlier today. The effect of the advisory committee system is that a certain number of people might be placed inside a trading position again. I know that in Government Departments this situation has been known over the years and is catered for in various codes and rules. But there are now three Agencies referred to in paragraph (b) and a person brought in to the advisory committee proceedings under paragraph (b) also would be involved. So there would be a restricted number of people who would be privy to certain information about a company which was not publicly known. We should be glad to have the Government's view on this situation and to know whether anything need be done about it.
Lord BESWICK: The noble Lord raises an understandable point. When he says there will be a restricted number of people who will come into possession of information, it may well be so—a restricted number under the provisions of the Act which we hope will follow—but he should not underestimate either the volume of information which goes into a Government Department or the number of people who have access to that information under terms of the strictest confidentiality. I do not see why we should treat differently the officials in one division of one Department who happen to be dealing with information coming under this Bill from officials in another division in the same Department.
Lord CAMPBELL of CROY: I believe that the noble Lord has misunderstood me. I was not referring to officials in the Department. I said that situation is one which has been known for many years and is catered for. It is the situation of people in the three Agencies mentioned in paragraph (c) and also outside persons not in Government service who are brought in under paragraph (b) with which we are dealing.
Lord BESWICK: So far as the Agencies are concerned, as I have already said there is absolutely no difference in their status from that of civil servants who are in a Government Department. They were doing that job in a Government Department. They are now doing it in an Agency or a Commission. The terms of the service are exactly the same. Therefore, they are on all fours with those who are in a Government Department.
There is one other point I would make. I think I am right in saying that the wording has been taken from the previous Government's Companies Bill which did not get on to the Statute Book. It will probably be agreed that there was a good deal of criticism about this form of words. I have heard it described as "a legal mess". Probably this is a point which ought to be covered more fully and I understand that it is being discussed by legal people. However, at the moment there does not appear to be a generally accepted formula to meet the kind of case that arises not simply out of this Bill but generally. May I suggest to the noble Lord that the point he makes is taken. It would not properly be taken by this Amendment. Even if it did, it would be wrong to apply this formula to a restricted number of people.
Lord CAMPBELL of CROY: Certainly this is not the only case of this kind which will arise. The noble Lord has referred to a similar situation and the attempt which was made to meet it in the 1973 legislation which was not completed. The noble Lord has accepted that there is a problem. It seems as though the way to deal with it is still being considered and thought out by lawyers and others. I am glad that the noble Lord has taken the point and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord MELCHETT: Amendment No. 270A was spoken to together with Amendment No. 163A. I beg to move.
Amendment moved—
Page 26, line 3, leave out ("representative of each relevant trade union") and insert ("authorised representatives of relevant trade unions").—(Lord Melchett.)
8.33 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 272:
Page 26, line 5, leave out subsection (3).
The noble Lord said: We should like to hear the Government's explanation of the wording of subsection (3) which this Amendment, which I now move, seeks to delete. It has been thought that it may be harsher than is necessary. It may arise from failure to carry out a preliminary order only within the time set. It is thought outside this House that it might be a single member of a company who failed to produce the required information in time and was then convicted. Clearly this could not be excused. The conviction is an offence which one would deplore, but it seems to be going rather far to decide that the information connected with that case would then be divested of confidentiality and not to take into account whether or not it was very sensitive information. It could be sensitive to an extent which was out of all proportion to the error or offence that had been committed by a member of the company. We should be glad if the Government could explain why it is necessary to have this subsection in the Bill.
Lord MELCHETT: The point of subsection (3) is that it allows the Minister to disclose information if the person required to furnish information to representatives of relevant trade unions has been convicted under Clause 28(1)(b) of refusing or failing to do so without reasonable excuse. This would allow the Minister in effect to set right the wrong done by the commission of the offence. Without this subsection the Minister would be forced, so as to obtain the disclosure to trade union representatives that is sought, to serve a further notice under Clause 23(1) or Clause 24(1). Yet the company would have been convicted of ignoring just such a notice and must be suspected of intending to ignore a second one. If the offence were repeated there might be a further fine, but this would not by itself result in disclosure.
In these circumstances, in our view it would be anomalous for the Minister still to be bound by restrictions on the disclosure of information, and quite proper that he should he able to pass on

825
the information which is in his or her possession. The information that the Minister may disclose in such circumstances is only that which he has obtained under Clause 23. Clause 26(3) does not authorise the Minister to disclose other data furnished to him on a confidential basis. The point to bear in mind is that this is disclosure of information only after a company has been convicted of a criminal offence. I find it hard to believe that a company, even if only one person in that company was responsible, would be convicted of a criminal offence without all the members of the company having considerable notice that this was going to happen, and for them to have time to sort out the position about disclosure of information before it ever got to the stage where they had been convicted and the Minister was acting under this subsection.
Lord CAMPBELL of CROY: May I take up one point. This is an important interpretation of the Bill. The previous subsection, subsection (2), says:
"Subject to subsection (3) below, this section applies to information which has been furnished to a Minister under Section 23 above…"
This confidentiality clause as a whole appears to apply only to information required by the Minister for the purposes of his Department or other Departments, and not for the purpose of passing on information to trade union representatives. Therefore I was a little surprised when the noble Lord spoke about transmitting information to trade union representatives. As I understand it, the words, "Subject to subsection (3)" mean that it is subject to exemption in a case where there has been a conviction. I wonder whether the Minister can confirm my interpretation that the whole of this clause relates to information furnished to the Minister for Government purposes and not to passing on information to trade union representatives, because that seems to be the meaning of the words in the previous subsection:
"…but has not been furnished to the representative of each relevant trade union under Section 25 above".
It could be that the interpretation is one of timing—that the information is in a state where it has reached the Minister
826
but has not yet been considered for the later stage of passing it on to trade unions. I think that there is ambiguity here, and I should be grateful for clarification.
Lord DRUMALBYN: May I go a little further into this. I thought that the Minister's explanation was rather peculiar.
Lord MELCHETT: I was going to explain that I had made a mistake. It may save the Committee's time if I clarify the position. In fact I have not made a mistake, but there is a printing error in the Bill which may be leading the Committee into confusion. Certainly it led me into confusion in my reply. All I said was correct, but the fact is that in subsection (3) on page 26 the Bill should read:
… has been convicted of an offence under Section 28(1)(b) below in relation to it."
and not Section 28(1)(a). The noble Lord, Lord Campbell of Croy, has hit upon a printing error. I am not sure whether or not that is inadvertent accuracy but I hope that it will clear up some of the misapprehensions which both noble Lords opposite have about this provision.
Lord CAMPBELL of CROY: While we are revising our versions of the Bill, I would say straight away that I have been able to assist the Government by picking up some other errors in the Bill, but I do not think anyone could have foreseen that this was an error because it referred to a paragraph which actually existed. Of course, it changes the whole complexion of this subsection, and I am glad that we raised it because paragraph (b) is certainly a stage of the procedure which is a good deal further on than the preliminary notice. That explanation makes this subsection more comprehensible and it is easier to understand why it is in the Bill. I cannot resist reminding your Lordships that on several occasions the noble Lord, Lord Beswick, has genially invited us to read the Bill, but in this case it would not have helped us. I was asking the noble Lord about this other point in regard to interpretation. I entirely understand that if it is a "fast one" at this stage of the Bill, he may wish to reserve the explanation until later, but it is an interpretation which I think ought to be given at some stage.
Lord DRUMALBYN: I would only say in passing that the fact that a company refuses to disclose information in accordance with Clause 28(1)(b) and either Clause 23 or 24, does not necessarily mean that that clause is, to use a kind of Latin grammar phrase "meet to be disclosed." I think this still has to be looked at. It might not be in the national interest to disclose it, and there might still be special reasons for not disclosing it. If the company feel so strongly that they refuse to disclose it even to the Minister, the likelihood is that there are very good reasons for it. I personally should like to study this further.
Lord MELCHETT: It is not merely that they have failed to comply with Clause 28(1)(b), but they have actually been convicted of an offence.
Lord DRUMALBYN: Yes, exactly.
Lord MELCHETT: And then the Minister, instead of issuing another notice—in other words, doing exactly what he has just done before and having the company convicted—we feel must have the power to proceed in a slightly different way. After all, it is not much use to the Minister or anybody else if he keeps issuing notices, the company keeps refusing to comply, keeps getting convicted and fined, and the Minister has the power only to issue another notice. Of course, the Minister still retains some discretion about whether or not he discloses the information. If it is going to be harmful to the national interest. I imagine that the Minister would not disclose it. If the noble Lord thinks about it, I am sure he will feel that it would be a mockery of these provisions in the Bill if the only power the Minister has when somebody is convicted of failing to comply with an order is merely to reissue the same order so that the person may be reconvicted, and nothing more happens than that. That is the purpose of this reserve power. I am afraid that in the confusion about listening to whether it was clause 28(1) paragraph (a) or (b), I did not catch the "fast one" which the noble Lord, Lord Campbell of Croy, claimed to have sent over the table.
Lord CAMPBELL of CROY: I was asking for an interpretation of the previous subsection (2). I have not tabled an Amendment to that subsection, but of
828
course it runs straight into subsection (3) and I was asking whether my interpretation was correct. I merely said that if in the short time available the noble Lord was not able to give me the answer, I was ready to wait until the next stage of the Bill. I will clarify it again as the noble Lord has invited me to. In subsection (2) it appears that this clause is related only to information which is furnished to the Minister and not to information which he is going to seek to pass on to trade union representatives. The confidentiality clause (which this is) relates to information within the Government machine but including three agencies. In his initial reply to me the noble Lord spoke in terms of the information being transmitted to trade union representatives. That surprised me, because I did not think it arose in this clause. I realised that there might be ambiguity in the wording, which I will again repeat,
"that has not been furnished to the representative of each relevant trade union under Section 25 above."
That might indicate that it was a matter of the stage reached rather than the different kind of information; that it was related only to the information going to the Government as opposed to the trade union representatives and therefore was information that was likely to be confidential.
Lord DRUMALBYN: There is a further point here. The noble Lord has been arguing that once a person has been convicted of an offence of refusing or failing without reasonable cause to furnish information, the Department should then be exempted from the requirement not to disclose the information. That is as I understand the position. If they do disclose the information, is the £40 a day fine to go on running for ever? They have disclosed the information, the person who has been convicted of an offence is to be guilty of a further offence so long as the default is continued. I suggest that the noble Lord should look at this. To say the least, it looks a little untidy.
Lord MELCHETT: It may be untidy, but it would certainly he incompetent of the company if they did not disclose the information. I will certainly—if the

829
noble Lord wishes to say something to me perhaps he will rise.
Lord DRUMALBYN: How can they disclose something that has already been disclosed? That is a nonsense, if I may say so.
Lord MELCHETT: If I may say so, I should have thought the company could disclose something from the company although the Minister has already disclosed it from the Minister, but I may well be wrong about that. I will write to the noble Lord if I am wrong, but there would be nothing to stop the company ceasing to be in breach of the law by disclosing the information itself once the Minister had done so.
To answer the noble Lord, Lord Campbell of Croy, my understanding of subsection (2) is that it means the confidentiality provisions cease to apply after information has been furnished to the trade unions. But until then the confidentiality provisions apply, except for the provisions of subsection (3), which is what we have been discussing under this Amendment, even where the information has not been furnished and the company has committed an offence. I hope that clears up the interpretation of subsection (2).
Lord CAMPBELL of CROY: That is a very important statement of interpretation, because it means that this clause refers not only to information which is being disclosed to the Government and not intended to go any further, but also information which may be going on to the trade unions so long as it is with the Minister and before the process is started of suggesting that it be transmitted to the trade unions. I see no difficulty about that; it is covering both eventualities. I am grateful to the noble Lord for having explained the intention of this part, which was not clear. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
8.39 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 273:
Page 26, line 10, at end insert—
"(5) If in contravention of this section information to which this section applies is disclosed and if the person by whom the
830
information was furnished in consequence sustains commercial loss or damage, the Minister to whom the information was furnished shall compensate that person in full for that loss or damage."
The noble Lord said: This Amendment simply raises the question of whether there should be any compensation available if there is a breach of confidence somewhere in the Government machine or through the Government machine, resulting in damages to a company which has supplied this information. It could be said that companies are being kept to a fairly strict discipline, including the whole process of convictions and fines if they do not observe the system correctly, and this simply raises the question of whether there is any way in which, if the company is let down in some way, it can claim compensation for damage which has been proved to have occurred as a result. I beg to move.
Lord BESWICK: I recognise the argument that if the Government require a company or body to provide information of a possibly sensitive kind, and Parliament imposes a duty of confidentiality on that provision, then the Government should reasonably pay compensation because of that breach. Although the noble Lord said that it was a simple matter, it is a little more complicated than that. Information of a commercially sensitive sort has been required before in a number of different Acts; for instance, the Statistics of Trade Act 1947, the Counter-Inflation Act 1973, the Insurance Companies (Amendment) Act 1973, and so on. There is no novelty in a Government or other bodies such as the Monopolies Commission or the Prices Commission, for example, having obtained information either voluntarily or by Statute whose disclosure could cause embarrassment or damage.
What we have put forward in this Bill is exactly comparable to what has been done in some previous legislation. We have proposed that improper disclosure by the Minister or by any other body to which he has passed the information, as he is allowed to by Clause 26, should be a criminal offence. The only difference between this Bill and earlier Statutes is that we have increased the maximum fine payable for a summary conviction; on indictment, a person convicted of an offence may be liable to an

831
unlimited fine or a term of imprisonment not exceeding two years.
One of the matters which should be looked at with some care is as to whether the introduction of an Amendment on the lines proposed could affect the construction which might be placed by the courts on all the other Acts I have mentioned which impose a specific duty to preserve the confidentiality of information which has been required by the Government. It could be that a specific definition of rights in this Bill might reduce the Common Law rights which might exist in other cases. The noble Lord will no doubt bear in mind that the Law Commission have published a working paper, No. 58, on breach of confidence. Again, it would be desirable to consider more fully than has yet been possible what would be the effect of legislating in one specific case when wider and more general legislation has been proposed by the Law Commission, in work which stems from the Report of the Younger Committee on Privacy.
I hope that what I have said indicates the seriousness of what the noble Lord says. I hope he will accept that there is a complication which probably extends further than he thought. With the assurance that I am giving, that the matter is one which is at present receiving study, I hope that he will see fit to withdraw this particular Amendment.
Lord HARMAR-NICHOLLS: Do I understand the noble Lord to suggest that that may well be included in this Bill?—because there ought to be some discipline from that side, too. All the discipline at the moment seems to be directed against management, and that one understands, because they are the source of information that is wanted. But if it is wrongly or carelessly disclosed, which damages the company, it ought to be written in somewhere that compensation will cover it, otherwise there is no discipline at all to be ultra careful in the interests of a company.
Lord BESWICK: Far from there not being discipline, I have detailed the criminal offence as created by the improper disclosure of information. When the noble Lord gets on to a civil offence, it would not be proper to put anything
832
in the Bill which might have an effect upon other areas of legislation. I suggested, though apparently not too clearly, that it is a matter which requires more thought. Some thought has been given to it by the Law Commission, and on the basis of their Report we are giving it further study.
Lord LEATHERLAND: Is there not just a risk that the proposal contained in this Amendment and, perhaps, to some extent, the concessionary attitude of my noble friends on the Front Bench, might go too far? Let us visualise a position in which, let us say, Imperial Chemical Industries, with a capital of many millions of pounds, gives some information to the Minister. Let us assume that by some mishap, that information leaks. Let us then further assume that some wicked people in the Stock Market decide to mount a colossal bear market with the result that the capital value of ICI as quoted on the Stock Exchange is reduced by hundreds of millions of pounds. Is the Minister going to have to be responsible for paying compensation to that extent?
A Noble Lord: Why not?
Lord BESWICK: What I have said I should have thought would have satisfied my noble friend. I have said that we are proposing not to move without due consideration.
Lord CAMPBELL of CROY: I am glad that the problem is recognised. As the noble Lord, Lord Harmar-Nicholls, said, through this Bill companies are now being asked to enter into a system by which they will be directed to provide information. So the Government ought to consider the position even though it is complicated when, as a result of all that companies have done by compulsion, they suffer damage. But as the noble Lord has said that this is being considered in a wider context, I will not press it at this moment and beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clause 26, as amended, agreed to.
8.55 p.m.
Lord BESWICK: I beg to move Amendment No. 274.
Amendment moved—
After Clause 26, page 26, line 10, at end insert ("PART V").—(Lord Beswick.)
Lord DRUMALBYN: May I ask a more than usually tiresome question? Amendment No. 280A says "Transpose Clause 28 to after Clause 26". Does Part V in fact come at the end of line 10, or does the transposed clause come at the beginning of Part V?
Lord BESWICK: At four minutes to nine that is a particularly tiresome question, and I am afraid I have not got the answer.
Clause 27 agreed to.
Clause 28 [Offences, and enforcement of orders]:
8.58 p.m.
Lord CAMPBELL of CROY Lord CAMPBELL of CROY moved Amendment No. 275:
Page 26, line 22, after ("information") insert ("within a reasonable time")
The noble Lord said: At an earlier stage, the noble Lord, Lord Melchett, suggested that this Amendment might be considered at the same time, but I did not agree because it came at a later stage in the Bill and was not, I thought, related exactly to the point I was then making. Fortuitously, it happens that this Amendment now has rather more significance than I had thought as a result of the misprint just announced. It is an Amendment to paragraph (b) which should be referred to in subsection (3) in the previous Clause 26. The suggestion is that in addition to "reasonable cause" in this subsection which reads,
"refuses or fails without reasonable cause to furnish information",
there should also be inserted, "within a reasonable time", because there is nothing to indicate that a company has had enough time to co-operate and furnish the information. I am not sure that it is covered by, "without reasonable cause", but in so far as the Government have put in the words, "without reasonable cause" I should have thought that they could have inserted, "within reasonable time" particularly as (b) now has rather more importance than we previously thought. I beg to move.
Lord MELCHETT: I am afraid that once again, with one eye on the clock, I do not think discussing this point yet again is a reasonable use of time, because we covered it on an earlier Amendment. I said then that I would ask your Lordships to look at paragraph (a) of Clause 24(1), which specifically states that reasonable time must be given and that this shall not be less than 28 days. If the time specified in the notice were to be unreasonable, or if the information simply were not available, it would be a defence in terms of paragraph (b) of Clause 28(1), in that both these would be a reasonable cause for failure to have provided the information and hence the company would have committed no offence in thus failing to provide it. I regret to say I do not think the fact that there was a misprint in the Bill alters the insignificance of this particular Amendment.
Lord BROWN: May I add a little further argument. I was going to comment on the previous Amendment, but thought it was unnecessary at that stage. Clause 24(5) says:
"A Minister shall not serve a notice… without giving… the company… concerned
an opportunity of making representations to him."
If the time given is not reasonable, if the company suggests to the Minister that the time is not reasonable, no doubt he will alter his mind, and in the last analysis it is the Minister who has to say whether or not it is reasonable. There are all sorts of safeguards against unreasonable time being imposed on the company.
Lord CAMPBELL of CROY: The significance I was speaking of was the significance to this paragraph (b), not necessarily to the Amendment. The noble Lord in reply has indicated that where it is written in other parts of the Bill it will have its effect here. This is a subsection dealing with offences and imposing a fine, and it was therefore necessary to ensure that this point about reasonable time was applicable in this subsection of this clause as well as in other parts of the Bill, but in view of the complete assurance we have had from the noble Lord that that is the case, I beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
Lord BESWICK: I beg to move Amendment No. 275A, and perhaps we may take with it No. 276A, No. 277A and No. 280A. All these are drafting Amendments which recognise the proposed division of the Bill into different Parts. I beg to move.
Amendment moved—
Page 27, line 13, after "this") insert ("Part of this")—Lord Beswick.)
Lord CAMPBELL of CROY: I beg to to move Amendment No. 276. This is seeking an explanation of why subsection (7) is needed in the Bill. We should be grateful if the Government could give an explanation. I beg to move.
Amendment moved—
Page 27, line 22, leave out subsection (7).—(Lord Campbell of Croy.)
Lord LOVELL-DAVIS: Subsection (7) is simply a standard provision of legilation dealing with offences by bodies corporate and that is why it is included in the Bill. Its purpose, like that of subsection (6) is to provide that persons responsible for failure to meet the requirements imposed by the Statute may be held to be individually liable for the offence thus committed by the body corporate. It therefore covers those cases where the affairs of the body corporate are not managed by a board of directors elected by members but are directly managed by the members, for example, the nationalised industries, and extends to them the same provisions as apply to managers and officers of bodies corporate by virtue of subsection (6). Similar provisions exist in the Fair Trading Act 1973, Section 132(2) of the Civil Aviation Act 1971, and the Gas Act 1972. I hope that explanation satisfies the noble Lord.
Lord CAMPBELL of CROY: I am grateful for the explanation, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord BESWICK: I beg to move Amendment No. 276A.
Amendment moved—
Page 27, line 26, after ("this") insert ("Part of this").—(Lord Beswick.)
Lord CAMPBELL of CROY: I beg to move Amendment No. 277. It may be
836
that my noble friend Lord Balfour will consider it convenient for his immediately-following Amendment to be discussed at the same time. I have a natural curiosity as to why in the Bill Scotland should appear to be missed out, why it should not seem necessary to make separate provision for Scotland, when subsection (8) deals with England and Wales and Northern Ireland. I am sure there is some explanation and your Lordships would be interested to hear what it is. I beg to move.
Amendment moved—
Page 27, line 31, at end insert—
("(c) in Scotland except at the instance of the Lord Advocate").—(Lord Campbell of Croy.)
Lord LOVELL-DAVIS: I am happy to say there is nothing sinister in the omission of Scotland. The Bill, like other Statutes, specifices that the appropriate Attorney General's permission shall be obtained for prosecutions in England, Wales and Northern Ireland. Like other Statutes, it makes no mention of Scotland. This is because in Scotland all prosecutions—other than two categories, neither of which is relevant to the Industry Bill—require the consent of prosecuting authorities. The proposal to designate the Lord Advocate as sole prosecuting authority would disrupt an existing and adequate system without adding any benefit.
Lord CAMPBELL of CROY: I think I can speak for my noble friend and myself in thanking the noble Lord for that explanation, and beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord BESWICK: I beg to move Amendment No. 278A.
Amendment moved—
Page 27, line 32, after ("this") insert ("Part of this").—(Lord Beswick.)
The DEPUTY CHAIRMAN of COMMITTEES (Lord Alport): If Amendment No. 278B is approved I cannot call Amendments Nos. 279 and 289.
Lord BESWICK: I beg to move Amendment No. 278B. I spoke to this on Amendment No. 130A.
Amendment moved—
Page 27, line 37, leave out subsections (10) and (11).—(Lord Beswick.)
The Earl of BALFOUR: Could I take the opportunity of asking the noble Lord, Lord Beswick, whether he would look at the bottom of page 27, at the last two paragraphs, where no criminal proceedings take place? Should it not extend to a vesting order as well as a prohibition order? If the noble Lord prefers it, I can leave this and put it down at Report, but I felt I should like the opportunity to ask the question.
Lord MELCHETT: I understand the noble Earl is speaking of his two Amendments which will not be called if this Amendment is passed. Perhaps I can briefly explain the purpose of the two subsections the noble Earl was seeking to amend. That might set his mind at rest. The noble Earl's two Amendments seek to alter the two subsections which are somewhat different from the other provisions in this clause, in that they do not create offences but instead state that any contravention of a prohibition order shall not constitute a criminal offence, but civil proceedings may be brought in respect of a prohibition order. The subsections are confined to prohibition orders, and the question to which they relate is how a prohibition order is to be enforced. The answer they embody in statutory form is that breach of a prohibition order is not to be a criminal offence, but civil proceedings may be brought.
The Secretary of State, if he believed the person to be acting in a manner contrary to a prohibition order, could seek an injunction from the court preventing that person from doing so. Any actions taken in the face of such an injunction would amount to contempt of court, thus making the person guilty of the contempt and liable to committal to prison. This provides a proper and adequate means of ensuring that prohibition orders are respected and criminal proceedings are therefore unnecessary. I hope that that answers the point of the noble Earl.
The Earl of BALFOUR: Yes.
Clause 28, as amended, agreed to.
9.9 p.m.
Lord BESWICK: I beg to move Amendment No. 280A.
Amendment moved—
Transpose Clause 28 to after Clause 26.—(Lord Beswick.)
Clause 29 agreed to.
Clause 30 [Interpretation]:
Lord BESWICK: I beg to move Amendment No. 281A. I spoke to this with Amendment No. 100A.
Amendment moved—
Page 28, leave out lines 25 and 26.—(Lord Beswick.)
Lord BESWICK Lord BESWICK moved Amendment No. 283:
Page 28, line 28, at end insert—
(""holding company" means a holding company as defined by section 154 of the Companies Act 1948 or section 148 of the Companies Act (Northern Ireland) 1960;")
The noble Lord said: I am bound to say that I am not properly advised about this, but it simply provides a definition of a holding company in terms of the existing definitions of the Companies Acts. It is the same as the previous definition which was in Clause 10(2)(b) but which was deleted as part of Amendment No. 97. It is more appropriately placed in the interpretation clause because "holding company" appears elsewhere in this Bill, for example in Clause 22(2)(b) in addition to Clause 10. I beg to move.
Lord BESWICKmoved Amendment No. 284:
Page 28, line 37, at end insert—
(""planning agreement" has the meaning assigned to it by section 16(2) above;")
The noble Lord said: This Amendment explains the meaning of a planning agreement. The same definition also appears in Clause 16, but since the phrase now occurs not only in Clause 16 but in paragraph 2 of Schedule 4 it is appropriate that a reference to the definition in Clause 16 be made in the interpretation clause. I beg to move.
Lord MELCHETT: I beg to move Amendment No. 284A. This was spoken to with Amendment No. 100.
Amendment moved—
Page 28, leave out lines 38 and 39.—(Lord Melchett.)
Lord WIGODER: My noble friends and I find ourselves with a formidable ally on this Amendment. For our part we do not desire to move.
Lord LOVELL-DAVIS: Then it falls to me to move Amendment No. 285 on behalf of the Government.
Amendment moved—
Page 28, leave out from beginning of line 40 to end of line 4 on page 29.—(Lord Lovell-Davis.)
Lord BESWICK: I beg to move Amendment No. 285A. This was taken with Amendment No. 100A.
Amendment moved—
Page 29, leave out lines 10 and 11.—(Lord Beswick.)
9.13 p.m.
The Earl of BALFOUR The Earl of BALFOUR moved Amendment No. 286:
Page 29, line 29, at end insert ("mining and quarrying.")
The noble Earl said: In dealing with Clause 30(2) may I ask your Lordships to look at Clause 30(1) under "manufacturing industry". It says that this
"means, subject to subsection (2) below, activities which are described in any of the minimum list headings in Orders III to XIX (inclusive)…."
Mining and quarrying do not appear in that, but they are both highly labour intensive industries. I should perhaps point out to your Lordships that the intention is that mining and quarrying should go in, if it is accepted, after packaging. There has been a slight muddling of the page numbers, but this is where it is intended to go.
Lord MELCHETT: To show how reasonable we become once we start making progress with Amendments, I fully accept the logic behind this Amendment and if the noble Earl. Lord Balfour, will agree to withdraw it the Government hope to come forward with a similar Amendment, though with slightly different wording, on Report.
The Earl of BALFOUR: With that assurance, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 30, as amended, agreed to.
Clause 31 [Orders]:
9.15 p.m.
Lord MELCHETT: I beg to move Amendment No. 287, which was discussed with Amendment No. 40.
Amendment moved—
Page 30, line 5, at end insert—
("(3) It is hereby declared that any power of giving directions or making determinations conferred on the Secretary of State by any provision of this Act includes power to vary or revoke directions or determinations given or made under that provision.")—Lord Melchett.)
Clause 31, as amended, agreed to.
Remaining clause agreed do.
Schedule 1 [The National Enterprise Board]:
9.16 p.m.
The Earl of BALFOUR The Earl of BALFOUR moved Amendment No. 288:
Page 31, line 39, at end insert ("or is unsuitable to continue as a member")
The noble Earl said: This is typical Scottish caution and I merely intend by this Amendment to insert the phrase:
"or is unsuitable to continue as a member"
which appears in much Scottish legislation.
Lord LOVELL-DAVIS: I am in sympathy with the basic purpose of this Amendment. It is a very important matter that the Secretary of State should be able to exercise his ultimate responsibility for the NEB by controlling the composition of the Board, and this inevitably means that he must be able, should the need ever arise—and, of course we all hope that it never will—to declare vacant the office of any member of the NEB who is manifestly unsuitable to continue as a member.
The need is to find words which give the Secretary of State the appropriate discretion without at the same time depriving Board members of reasonable security, and in the extreme without permitting a situation in which members continued in office only at the Minister's pleasure, and were open to pressure from him to exercise their duties in particular ways against the threat of dismissal. The Government have chosen to use the words "unable or unfit" as the means of giving proper discretion. Although

841
the word "unsuitability" carries connotations very similar to the words "unable or unfit", it could probably cover wider considerations, such as political suitability with regard to the Government in power. This would clearly be undesirable and the Government feel that the existing wording conveys their intentions more clearly.
Clause 6(1)(d) ensures that a member's office be declared vacant in other circumstances than those specifically set out in Clause 6(1)(a) to (c), which cover the more readily foreseeable circumstances in which it would plainly be undesirable for members to continue in office; protracted absence from meetings of the Board, bankruptcy, physical and mental illness. Unfortunately these are not, I need hardly remind your Lordships, the only misfortunes and weaknesses to which human beings are subject, and more general grounds for removal from office must be available to the Secretary of State. I am sure noble Lords will agree that a general reserve power such as already exists as a common provision in relation to public corporations must be available to the Secretary of State in the case of the NEB. On the other hand, the power is not arbitrary and there must be specific considerations of inability or unfitness before the office of any member can be declared vacant. I hope that this explanation will satisfy the noble Earl.
The Earl of BALFOUR: Yes, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
9.19 p.m.
The Earl of BALFOUR The Earl of BALFOUR moved Amendment No. 289:
Page 33, line 4, after ("member") insert "or his spouse")
The noble Earl said: In this part of the Bill we read:
"A member who is in any way directly or indirectly interested in a contract made or proposed to be made by the Board…."
I feel that the phrase "or his spouse" should he included here. The highest standard of care must be taken in a matter like this and people in this position might manage to get some gain through passing on information, perhaps to their spouses.
Lord MELCHETT: I hope that I will not shatter the friendship which I trust
842
has built up between the noble Earl and myself since I was able to accept an Amendment of his, but I cannot resist pointing out that this Amendment would have the effect that the spouse of a member of the Board would have to turn up at the Board meeting to declare his or her interest rather than, as I think the noble Earl intends, that the member of the Board should declare his or her spouse's interest at the Board meeting. But the fact is that we feel there are safeguards to cover the important point which the noble Earl has raised. They are two. First, under paragraph 1 of the Schedule, the Secretary of State is given the duty of satisfying himself that persons he is considering appointing to the Board do not have financial or other interests likely to prejudice their performance as members of the Board. This would enable him to require such information as he may specify to be furnished by the persons—that is, the Board members—involved. He would therefore be able to require any details about interests of the members' spouse which he thought relevant to be disclosed.
Secondly, the requirement under paragraph 13 for relevant interests of members to be declared at meetings of the Board is very broadly drawn—and deliberately so: the obligation to declare interests relates to
"a member who is in any way directly or indirectly interested in a contract or any other matter."
In our view it must be implicit in this requirement that any relevant interest of the member's spouse would have to be declared as being an indirect interest in the matter to be discussed. I hope that, with those assurances, the noble Earl will see fit to withdraw the Amendment.
The Earl of BALFOUR: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Schedule 1 shall be the first Schedule to the Bill?
Lord BOYLE of HANDSWORTH: I should like to say one word about one crucial category of people who are not specifically referred to in this first Schedule to the Bill, namely, the permanent advisers to the Board. We are quite rightly concerned with the question of Board members, but it is difficult to

843
imagine more important work for the Civil Service than that of giving permanent advice to the Board, with their very wide functions. I hope we can be assured that the Minister for the Civil Service will not only be concerned with the salaries of the members of the Board but will also work closely with the Secretary of State to ensure the quality of those who are to advise the Board.
Lord BESWICK: I can say only that this point has not escaped the notice of those who are concerned with this and that it has been taken very much to heart. One of the encouraging features of this whole business is the evidence that we have in this country persons of the quality which will be required.
Schedule 1 agreed to.
Schedule 2 [Financial and Administrative provisions relating to Board]:
9.25 p.m.
Lord BESWICK Lord BESWICK moved Amendment No. 290:
Page 38, line 38, at end insert—
("(2A) A copy of the register under section 1(9) above, as amended from time to time, shall be annexed to each such report.")
The noble Lord said: When we discussed Amendments 19 and 20 to Clause 1, we transferred responsibility for keeping the register of interests of Board members from the Board to the Secretary of State. The Amendment, together with Amendments Nos. 291 and 292, are relatively minor Amendments to the provisions for registering Board members' financial interests.
The Government feel that it is more appropriate for the Secretary of State to maintain the register than the Board themselves, since it is the Secretary of State who has to satisfy himself under the provisions of paragraph 1 of Schedule 1 that the members have no financial interest likely prejudicially to affect the performance of their functions. It also seems appropriate that the register should be made available to Parliament each year, so there is provision for a copy to be annexed to the Board's annual report which must be laid before both Houses of Parliament by the Secretary of State. I hope that what I have said will be accepted as extending also to Amendments Nos. 291 and 292. I beg to move.
Lord BESWICK: I beg to move Amendment No. 291.
Amendment moved—
Page 38, line 39, leave out ("so laid") and insert ("laid before Parliament under subparagraph (2) above").—(Lord Beswick.)
Lord BESWICK: I beg to move Amendment No. 292.
Amendment moved—
Page 38, line 42, leave out ("Board's").—(Lord Beswick.)
Schedule 2, as amended, agreed to.
Schedule 3 [Arbitration]:
9.25 p.m.
Lord ELTON Lord ELTON moved Amendment No. 292J:
Page 39, line 20, after ("solicitor") insert ("who has practised for at least seven years")
The noble Lord said: This Schedule appoints a tribunal to deal with disputes arising over vesting and compensation orders. It will deal with very considerable sums, sometimes matters of considerable and lasting importance, and not necessarily only in questions of value. Its appeal is direct to the Court of Appeal and we feel it proper that the chairman should have a minimum qualification. Your Lordships will be aware that under the Courts Act 1971 minimum qualifications are provided for inter alia coroners and circuit judges. The noble Lord, Lord Beswick, who is to reply—or for whom another noble Lord will reply—was kind enough to tell me that the phrase which I had used in this Amendment was perhaps not exactly acceptable, since the word "practised" is not clearly defined. The noble Lord may prefer that I should return at Report stage, or substitute this Amendment with the manuscript Amendment that I have in my hand, which replaces the phrase concerning standing with the phrase "of at least seven years' standing" I should be happy to do either if it is his intention that the purposes of this Amendment should be incorporated in the Bill.
Lord BESWICK: The noble Lord accurately remembers what we spoke about in the Lobby. I accept the principle of what he says. It is also a fact

845
that to have an Amendment referring to a lawyer who has practised for seven years would be somewhat restrictive. That could, for example, leave out a barrister who is not in Chambers but who has considerable experience of precisely the area of work we have in mind. I should rather not have the noble Lord whip a manuscript Amendment out of his coat tails at this stage, but it would be better if we had "seven years' standing", and if he would agree, the noble Lord could put it forward at Report stage.
Lord ELTON: I thank the noble Lord for that reply and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Lord LOVELL-DAVIS Lord LOVELL-DAVIS moved Amendment No. 292A:
Page 40, line 36, leave out ("25") and insert ("27").
The noble Lord said: With this Amendment I should also like to speak to Amendment No. 292B. These are small Amendments. The first is to correct a drafting mistake by putting in the correct paragraph reference, and the second is to make the normal provision that there shall be Ministerial control over salaries that are paid from monies voted by Parliament. This will bring paragraph 12(2) into line with paragraph 12(1), which provides for the approval of the Minister for the Civil Service of salaries paid to tribunal members. Here we propose similar control over the salaries of officials appointed by the tribunal. I beg to move.
Lord LOVELL-DAVIS: I beg to move Amendment No. 292B.
Amendment moved—
Page 40, line 38, after ("may") insert (", with the approval of the Secretary of State given with the consent of the Minister for the Civil Service,")—(Lord Lovell-Davis.)
Schedule 3, as amended, agreed to.
Schedule 4 [Disclosure of information by Government]:
9.29 p.m.
Lord BESWICK Lord BESWICK moved Amendment 292C:
Page 42, line 41, leave out from beginning to end of line 12 on page 43, and insert—
("PROVISIONS RELATING TO THE MACRO-ECONOMIC MODEL

1. For the purposes of this Schedule the Treasury shall keep a macro-economic model suitable for demonstrating the likely effects on economic events in the United Kingdom of different assumptions about the following matters, namely—

(a) government economic policies;

(b) economic events outside the United Kingdom; and

(c) such (if any) other matters as appear to the Treasury from time to time likely to have a substantial effect on economic events in the United Kingdom.

2. The model shall enable forecasts to be made—

(a) of any of the following, namely—

(i) the level of growth domestic product;

(ii) unemployment;

(iii) the balance of payments on current account;

(iv) the general index of retail prices; and

(v) average earnings; and

(b) of such (if any) other economic variables as are appropriate in the opinion of the Treasury from time to time.

3. The references to forecasts in paragraph 2 above are references to forecasts relating to successive periods of three months and not to shorter periods.

4. The model shall be maintained on a computer.

5. The model shall be available to members of the public during office hours upon payment of such reasonable fee as the Treasury may determine.

6. Not less than twice in each year commencing with a date not later than one year from the coming into force of this Act, the Treasury shall publish forecasts produced with the aid of the model as to such matters and based on such alternative assumptions as appear to them to be appropriate.

7. Any forecast under this Schedule shall indicate, where possible, the margin of error attaching to it.

8. The Treasury shall from time to time publish an analysis of errors in such forecasts that would have remained even if the assumptions set out in the forecasts and on which they were based had been correct.")

The noble Lord said: The Amendment I now move is intended to maintain the essence of paragraph 1 of the Schedule which was introduced into the Bill in another place. The recasting it proposes is to improve the clarity of the text and to express it in an appropriate legal formulation. Changes of substance are few. Provision is made for the Treasury to have some discretion as to the ground which the forecasts will cover, and to

847
provide these not less than twice a year rather than quarterly. Secondly, a provision is made for the Treasury to charge a fee for the use of the facility. Thirdly, provision is made for a suitable period of time before the Treasury is required to bring the new facility into operation. As I hope is clear, the Amendment is an attempt to improve the first part of this Schedule. It has been the subject of constructive discussion outside the Chamber as well as in the other House, and I hope that it will be acceptable to both sides of the Committee. I beg to move.
Lord RHODES Lord RHODES moved Amendment No. 292H as an Amendment to Amendment No. 292C:
Line 1, leave out ("PROVISIONS RELATING TO THE MACRO-ECONOMIC MODEL") and insert ("DISCLOSURE OF INFORMATION BY GOVERNMENT")
The noble Lord said: I want to make it clear that my Amendment is very important. The Government are giving important information and analyses and we should not disguise what is being done by a technical sounding title like "macroeconomic models", which in any case is not the sole object of Schedule 4. If my suggestion could be included I should be satisfied. I beg to move.
Lord BROWN: With respect to my noble friend, predictions made from a computer are not information. They are predictions, nothing more. If one were to call these "information" it would put a false value on them. We are at the beginning of a process of using macroeconomic models based on computer science, and to go into the realms of the future and to regard these as positive information would be highly misleading. I hope that the noble Lord will withdraw this Amendment.
Lord RHODES: May I refer to a comment made by the noble Lord, Lord Beswick, only half an hour ago when he said that the point of obtaining information is to use it, and this is what we are attempting in this Amendment.
Lord BEAUMONT of WHITLEY: On the matters of programmes pertaining to computers the information is programmed into the computer and the result depends on what the computer has done to it. No one is pretending that
848
these are major facts necessarily reaching to the depths of the economic universe. Nevertheless they are information as to what the computer produces if you feed certain assumptions into it. Therefore it is information and I certainly support the noble Lord, Lord Rhodes.
Lord RITCHIE-CALDER: May I ask the Committee to consider the words "facts" and "information". Is information fact or not? Are we getting information from the Government, or are we getting facts, or are we getting something called the product of macroeconomic models?
Lord BOWDEN: The more important question is whether the Government are required to display the postulates which they made when they fed this information into the machine. The devastating fact is that far from frequently—in my experience almost invariably—when unreliable data has been subjected to very complicated calculations, it is assumed that in some mysterious way the original information gains a certain credibility which in fact it does not possess. I feel that it is at least as important, and will be as important for the future of this extremely important enterprise, that the Government should reveal their original postulates, their original assumptions, as that they should reveal the results of the calculations. They are often the more important, the more suspect and the more subject to argument. I wonder how far this point is covered.
While on my feet I should like to ask a very important question, namely: How in practice do you distinguish micro from macro-economics? The Government's policy of what they blandly call "fine tuning", which is what I am sure they mean by macro-economics, often leads to the bankruptcy of quite large industries, and this devastating effect is usually described as "micro", despite the effect it may have on society at large. I think we need a clarification of the phraseology and some guarantee that the information published will include far more than the results of dubious calculations based on unknown data.
Lord WIGODER: May I refer to Clause 22. Subsection (10) of that clause says:
"Ministers of the Crown and Treasury shall publish, make available and provide access to

849
information and analysis as specified in Schedule 4 to this Act."
An attempt to remove subsection (10) from Clause 22 has already failed. Is it not more logical in those circumstances that Schedule 4, which is referred to specifically in Clause 22, should therefore have the heading "Disclosure of information by Government" as proposed in the Amendment moved by the noble Lord, Lord Rhodes?
Lord BESWICK: I cannot understand why there is such argument about it. I entirely agree.
Lord RHODES: Thank you.
Lord RHODES Lord RHODES moved Amendment No. 292D, as an Amendment to Amendment No. 292C.
Paragraph 5, after ("public") insert ("to make forecasts based on their own assumptions using the aforesaid computer")
The noble Lord said: This is to get a bit more clarity into it too because paragraph 5 deals with the public access and I am making it quite clear, by inserting,
"to make forecasts based on their own assumptions using the aforesaid computer"
that the access is not just to this macroeconomic model. The macro-economic model is there in the Treasury already but it is not being used as we want it to be used and it is not being used as it will be used in the future. We want to make it clear that the access is to forecasting and not specifically to this model which on its own is quite indigestible for anybody, however intelligent or academic they may be.
May I say that charging, which is also in this paragraph, is necessary to limit frivolous use; but cheap or free access should be made available. When I say "public" access I mean those who are qualified and obey the precepts laid down in the Schedule: such as Parliament, the TUC, the CBI, research associations and the Press. I beg to move.
Lord BESWICK: Perhaps it would be helpful if I said straightaway that I am happy to accept this; except that on Report it might be advisable to make a minor amendment. For example, I am told by the people who specialise in these things that "aforesaid" is not a word normally put into a Statute and we may
850
have to change it. Otherwise I accept the principle.
9.39 p.m.
Lord RHODES Lord RHODES moved Amendment No. 292E as an Amendment to Amendment No. 292C.
Paragraph 6, leave out ("such matters") and insert ("all economic variables in the model")
The noble Lord said: This Amendment arises from very grave suspicions, because I would think that the term "such matters" is one of those Civil Service ambiguous references that can mean anything or mean nothing at all. The sole purpose of this Amendment is to prevent the Treasury from putting a blue pencil through "forecasting"; because if they did it would upset all the work that has been done in the Commons, speaking with a near unified voice, to put this in. I beg to move.
Lord BESWICK: I wonder whether we can look at this Amendment more critically than the other two. As it is drafted, it would place on the Government a duty to publish forecasts of alternative assumptions about a whole range of variables, including such sensitive items as wage rates, exchange rates, prices and so forth. As I have said already, the Government have a duty to consider the effect on events in this country and abroad of publication of such forecasts, and consider it essential that the Treasury should be given discretion to exercise their judgment on these matters when the national interest is involved. Noble Lords will agree that the Government have a duty not to release material which may be prejudicial to the national interest. Moreover, the model would contain a large number of variables, possibly running into many hundreds, and to publish forceasts of them all would be a mammoth and, I suggest, possibly not very rewarding task. While we have accepted the two previous Amendments, I suggest this one be not agreed to.
Lord BRUCE of DONINGTON: invite your Lordships to accept the Amendment moved by my noble friend. Paragraph 2 of the new Schedule reads:
"The model shall enable forecasts to be made… of any of the following… the

851
level of growth domestic product… unemployment… the balance of payments… the general index of retail prices… and average earnings."
It also covers a whole number of other factors. I can see it to be entirely in the public interest that these matters be made known. Some of our learned economists have made mathematical calculations in the past with pencils and paper, and their forecasts almost invariably over the past 25 years have been falsifying events. It is all very well for them to cast doubt and scorn on the possibility of a computer using a mathematical projection being able to put forward certain facts that ought to be considered by the public. It may well be that, in the event, after periods of six months or three months, subject to correction, the errors of the computer will become known. This is more than can be said for some of the errors which have been committed and compounded by virtually every public economist in this country over a quarter of a century.
Therefore it is in the public interest that the Government make certain forecasts public on the basis of data fed into the computer. The nature of the data can be disclosed so that the public can judge and form their own conclusions as to what predictions can be made. This amended clause which has been proposed by the Minister prescribed that the model shall enable forecasts to be made. It does not say society, or anybody else—
The Earl of BALFOUR: I am sorry to interrupt the noble Lord but I must ask one question: is the noble Lord speaking to Amendment No. 292D or 292E?
Lord BRUCE OF DONINGTON: I am speaking to Amendment No. 292E which was the Amendment moved by my noble friend. It is desirable, particularly in the years that lie ahead, that the public should be made aware of the alternative forecasts that can be made regarding the future of our economy on alternative assumptions. Therefore I consider it highly desirable that the Government should accept not merely the text of this Amendment but the whole spirit that lies behind it.
Lord BEAUMONT of WHITLEY: This is a very difficult question and I take the point of the noble Earl, Lord
852
Balfour, when he questioned which Amendment was being spoken to. Although undoubtedly we are speaking to Amendment No. 292E, Amendment 292D also is very much involved in this question. I feel strongly with the speakers who have spoken so far that we should have as much information as possible regarding the matters which have been fed into the computer and these hypotheses. I think this was the point that the noble Lord, Lord Bowden, was speaking to on the last Amendment and is no doubt going to speak to again.
However, it seems to me that there are undoubtedly parameters to this. Obviously the Government are rather cautious about the number of things they wish to be fed in; and it did not seem to me that the noble Lord, Lord Beswiek, when he was speaking about highly delicate matters on wages, et cetera, put up a case at all. I think those are matters which should be made public. But one would not have to think much further than that to come across matters which it is very much in the public interest that they are not revealed. I hesitate to refer to particular examples, but civil servants always have their own views about what their masters are doing and there could be moments in the history of this country in which the Treasury would wish to put in rather highly sensitive matters which, if it were revealed they had been put in, would, given the nature of the Press and the media, gain absolutely sensational headlines. That there could be such matters is not open to doubt, but I am absolutely and entirely behind the purpose of the Amendment.
I should like to ask the noble Lord, Lord Rhodes, this question. Is the point he is trying to insert, in Amendment No. 292E, not covered by having had No. 292D accepted? If there is freedom to use this computer; if there is freedom for members of the public—and that means, of course, highly skilful and highly informed members of the public—to put their own suppositions into the computer, they will probably do so in a way that the Treasury would also do, and they can get out the same answers and get the same information which can be released to the public. But what will then not happen is this. If the Treasury for some reason wishes to put in some really highly sensitive matters—and I am not just talking

853
about wage claims or rates of inflation, but really sensitive matters—it would not necessarily have to reveal this. I wonder whether Amendment No. 292D does not cover the great substance of what the noble Lord. Lord Rhodes, wants.
9.48 p.m.
Viscount HANWORTH: We have to fact the fact that computer models can be extremely complicated with a very large number of variables indeed, and it is not only the variables; it is the weighting that is given to them. So I have considerable doubts whether this Amendment ought to be accepted. It may be that another compromise is possible. As I think the last speaker said, we probably have all we want in Amendment No. 292D. But to make it compulsory to provide this information is going far to( ) far, and it will be far more complicated than can be of use to any except a very skilled economist, who incidentally is trained in this kind of thing—not every economist is.
Lord BOWDEN: I should like to make two points. First, it is inconceivable that every possible variable should be tried; the task would be wildly beyond the powers of any computer, however powerful. On the other hand, the purpose of doing this enterprise is precisely to be able to compare the economic effects of proposed courses of action. Unless the consequences of these actions are known in fair detail it seems to me that the whole purpose of the exercise is stultified. As I said a few moments ago. I should like to extend the meaning of the word "macro" by the use of the phrase, "or economic variables" to include such effects, for example, as the dramatic effect the 25 per cent. VAT on electronics is having on the electronics industry, which seems to me to be disintegrating under the effect of it.
That is precisely the kind of thing which should emerge from an analysis made with a fairly complicated computer of the kind of action which the Treasury has traditionally taken. I would go so far as to say that many of the economic ills which beset this country at the moment are due to the attempts that the Treasury has traditionally made at what it calls "fine-tuning". These attempts have been made without an adequate
854
survey of their total effect on the economy Of the country at large. It is precisely to make certain that this kind of thing does not occur again that this section of the Bill is so important. I hope that without committing the Treasury to doing the impossible, which is to try everything, we shall require it to publish as many alternative versions of alternative policy that the Government may wish to implement and find out what effect they will have on the economy as a whole.
Lord KAHN: I suffer from something far more serious than doubts about the value of this Amendment. When we return to the original Amendment, Amendment No. 292C as amended, I hope it will not be so late that the Committee will resent my saying a few words in general about that part of the Schedule to which Amendment No. 292C relates. I am afraid my remarks will be rather critical. I want to say now only that they will be even more critical if the Amendment which is now under discussion is passed, and I should like to support the noble Lord, Lord Beswick, in asking the Committee to reject the Amendment.
Lord WYNNE-JONES: It seems to me that we are in a position with which I have been familiar for a large amount of my active scientific life; namely, trying to decide how one uses an expensive facility. When one was faced with treating the use of an expensive facility, one found an enormous number of people—I am talking about the Department of which for many years I was its head—who came forward with schemes and proposals. They were all intelligent people, and they produced hundreds of different schemes. Unfortunately, it was left to me to decide what should be done about them. As my noble friend Lord Bowden has just said, the number of variables is so great that there is no conceivable way of accepting all of them. It would be so expensive of resources and time and it would waste so much energy that it would become an utter nonsense. Therefore one has to reach a decision about what is to be done.
We are always faced with the problem of whether we reach a decision which enables the reasonable things to be done or whether we take into account a large

855
number of unreasonable things. I am a great believer in the unreasonable, because I believe that so frequently the reasonable does not produce the answer. Nevertheless, however far one goes one must draw the line somewhere. Therefore I suggest that it is important that we realise that the Treasury ought to be expected to make these resources available, but they should not be expected to make them available to every Tom, Dick, or Harry, or whatever are the names of the different people concerned. In the end it means that if you do this you waste your resources to the extent that you get nothing done at all. Therefore, I suggest that what has been put forward by my noble friend Lord Beswick is probably, in the circumstances, the best we can do but I would hope that we shall be able to continue to exert continuous pressure.
Lord BOYLE of HANDSWORTH: I personally hope that the Government will resist and that this Committee will resist this Amendment. I should like briefly to explain one argument that influences me. I think the cause of saying that the Government should make more and more information available is always a popular one, and indeed I would say that in the last twenty years or so Governments and Departments have frequently been open to criticism for refusing to "come clean" about certain facts and figures which were germane to the argument. If noble Lords want to see this case set out well, I think Professor John Griffiths' recent book about Committee proceedings in Parliament made this point very effectively in its final chapter.
I see one great difficulty about this Amendment and, if I may say so, I think it is one that noble Lords ought to face quite fearlessly. If you go so far as this Amendment goes, you get into one very great difficulty. If we were to pass this Amendment tonight, it would be difficult for the published information and for the range of options, the range of contingencies that must by law be made available, not to include the possible effects of Government policies that have not yet come into being. That is not a new problem. It arose, as some more senior noble Lords than myself will remember, in the old days in the earlier economic surveys. People used to read the economic surveys—and I am thinking particularly of
856
those appearing in the years fairly soon after 1947—trying to get a clue from the forecasts as to just what policies Governments would be following. I may be old-fashioned about this, and if so I apologise, but I personally believe it is important that policies should be introduced by the Government, discussed in both Houses of Parliament and put into effect by Parliament before they become part of the general assumptions or even likely contingencies that become part of the general discussion in this country. For that reason more than any other, I would not feel happy at going so far as the last of these three Amendments.
This is not an easy subject. If we defeat this Amendment tonight, I am sure it will continue to be a bone of contention, but I believe that from the point of view of the delicate interplay between Government and Parliament the wisest course for this Committee to take would be not to pass the third of these Amendments.
Lord BESWICK: I wonder whether we could come to a decision about this. I think there is complete agreement on all sides of the Committee that we need to move on to an era in which the Government make available more information—the Government in general and the Treasury in particular. There is no difference between us on that, and in the Amendment I have already moved I have spelled out the kind of information which I think should be made available.
When we come down to the small print and to Amendment No. 292E, we are really moving into an era where we could be demanding so much information that it becomes worthless. My noble friend Lord Bowden, with his usual passion on these subjects, gave us a practical case. He probably will not be surprised to know that I had myself thought that the particular instance he gave was a prime example of how not to do things, if I may say this about my own Government.
There is every reason to expect that the arrangement set out in my Amendment would provide for that kind of information—the effect on a certain industry of a certain rate of VAT. This certainly would be given, but there could be other cases where the national interest would be involved. If there is one certain way

857
of creating a crisis, it is for a more authoritative Government Department to say that a crisis is possible. If that is projected, it is quite likely that people will make their dispositions accordingly and you will have created the very situation that you want to avoid. A certain measure of discretion here is essential.
I do not myself believe that the Treasury could altogether escape from the blame that they have created suspicions in the past. I think we are moving into a new area of consultation and greater confidence in which all available information would be made to those who can properly use it. The later Amendment I propose to make emphasises that still more. With that kind of attitude, I hope we can leave the Amendment which I have moved unaltered by Amendment No. 292E.
Lord RHODES: I have been impressed by what the noble Lord, Lord Boyle of Handsworth, and the Minister have said. I should like to be assured, however, that the phraseology in such matters does not give a loophole to the Treaury to expurgate forecasts. If the Minister will give me a categorical assurance that it does not mean that, I will withdraw my Amendment.
Lord BESWICK: I should be claiming more power than I have if I told the noble Lord, Lord Rhodes, that there may not be some occasions in the future when the Treasury would be open to criticism. I am being perfectly honest with him. My understanding of the situation is that we are trying to avoid the situation in his own Amendment, in which he says, "All economic variables in the model". I have with me a professional definition of what is involved in this macro-economic model. If you ask for all economic variables to be made available, you really are asking for too much. I am asking for a certain latitude. I grant the noble Lord that such matters could—I am not saying they would, but could—leave open certain loopholes. I can only say that the intention is not to use this phrasing for the purpose he fears. I cannot give a guarantee; I can only say that that is the impression I have had from various conversations I have had.
Lord RHODES: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Amendment No. 292C, as amended, shall be agreed to?
10.0 p.m.
Lord KAHN: I know it is getting late, but this Schedule is one of very great importance, and if I may be allowed to say a few words about that part of the Schedule to which this Amendment relates, it will save time so far as I am concerned when we come to later Amendments to this Schedule. I hope that what I have to say will be regarded as reasonably consistent with what has already been said by the noble Lord, Lord Wynne-Jones, and by my noble friend Lord Boyle of Handsworth.
I think I am right in saying that nothing on the lines of the Schedule appeared in the Bill as it went to the Committee upstairs in another place. Something similar to the Schedule was passed through the Committee as a result of an Opposition Amendment supported by Back-Bench Members of the Labour Party, but was rejected on Report stage on the Floor of the House in another place. This Schedule was proposed to the Committee upstairs by a Back-Bench Member of the Labour Party, but in fact when it came to a vote it was passed by 16 votes to 4 in the Committee upstairs. I am bound to admit that it was supported not only by all Members of the other Parties who were members of the Committee, but also by Members of the Labour Party, apart from four who were Ministers and Labour Whips.
Although the noble Lord, Lord Beswick, may wish to disagree, I maintain that the Schedule to which this Amendment relates, although it owes its origin to the Bill, admittedly has an importance which lies entirely without the scope of the Bill and which would either be important or, in my opinion, objectionable, irrespective of whether or not the Bill receives the Royal Assent. I regard it—but I speak subject to correction—as really owing its origins to the members of the Conservative Party, and I cannot believe that members of that Party really believe in this sort of thing.
With great respect I feel bound to take the view that either the intention was to discredit the operation of the Bill when it becomes law, or, if not that, to

859
expose the Treasury to public ridicule. And though I entirely agree that, in spite of the two Amendments that have been passed to it, Lord Beswick's Amendment to Schedule 4 which is now under discussion is a great improvement on the relevant part of that Schedule, I still think that the result will expose the Treasury to public ridicule. It is well known to Members of the Committee that the science of economic forecasting is in a very primitive state. It would be far better if the Treasury were left and encouraged to develop the science in private and in co-operation with other Government Departments, rather than be subject to the frustration involved in having to operate within the public view.
One thing I regret about Lord Beswick's Amendment, as opposed to the part of the Schedule to which it relates as printed in the Bill, is that it makes a specific reference to the computer. It ays: "The model shall be maintained on a computer". The computer can be, but very often is not, a remarkably good servant in the hands of those few people who know how to keep it under control, but it can prove an extremely unruly master. I sometimes wish and say to myself and to friends of mine that it might perhaps be better if civil servants were occasionally to subject what emerges from the computer to testing by adopting the old-fashioned method of using the back of an old envelope, which enables judgment based on experience to be exercised.
Lord BRUCE of DONINGTON: I am sorry to detain your Lordships again on this, but in my view Schedule 4 is one of the most important parts of this Bill. The reason why I supported the Amendment moved by my noble friend Lord Rhodes was because I thought that the nature of paragraph 2(b) of the proposed Schedule was unduly restrictive. One of the most important things we have to consider over the next decade is the projected level of capital investment in this country, and within that figure the level of investment in manufacturing industry and in other industry. If possible, I should like an assurance from my noble friend that the items included in paragraph 2(b) will include these most important projections of capital expenditure, and the nature of it, which have a
860
profound effect upon all the other variables which may be included in the model.
10.10 p.m.
Lord RHODES: I make no apology for prolonging this debate; I am not obeying the injunction of the Yorkshire coat of arms, "hear all and say nowt". I have listened to 20 years of this debate: I have got it into my system, I have got something to say and I am going to say it, and I might as well say it at this juncture. The Amendments that we are moving are important; they are not just technical. May I say at this juncture that, although there are technical phrases used in the Schedule, I cannot claim to use them myself in everyday language; but I can claim to understand some of the practical application of the language.
The Schedule as printed in the Bill was put down at the Committee stage in another place, as the noble Lord, Lord Kahn, has just said. It was carried, even though four Ministers voted against it. Then it received a resounding majority—I think it was 242 to about 122—on the Report stage. The House left no doubt about what it wanted. The House of Commons is the House that we here have to take notice of, because so often we have been told what will happen unless we do.
Lord KAHN: May I interrupt the noble Lord?
Lord RHODES: No, just let me have my say. You have heard the dynamism of the noble Lord, Lord Kahn, and all that he has said for the conventional attitude. Look what a mess this conventional attitude has got us into, and people of his ken! The noble Lord, Lord Kahn, can reply afterwards. Why did this Schedule command such support? I believe that it was spontaneous recognition of the fact that here was an opportunity to support an effort to create an industrial strategy that will work. Ever since I came to Westminster, 30 years ago, I have seen Government after Government, of both Parties, handing out billions of public money; Industry Act has followed Industry Act on to the Statute Book, and then into limbo. Adult decisions have been taken almost at random; money handed to one company and nothing for another, and very often

861
under political duress, without any confidence that it was the right thing to do.
It must be 17 years ago that a colleague of Lord Kahn came to the Parliamentary Scientific Committee of the House and brought with him a model that he was working on, now known as this macro-economic model. Do you know that half the Parliamentary Scientific Committee had a giggle over what that Professor Stone brought to the House, but they do not today. It so happened that in 1959 at about the time Professor Stone came to the Standing Committee, I made a journey to Japan, when they were just starting their forecasts. It so happened that in 1947 I was in Japan when into the ante-room to General McArthur a young man came. He was asking for 830,000 tons of coking coal to make so many tons of steel and he got it. Today that man is the head of Nippon Steel. Nippon Steel makes 33 million tons while we make 17 million tons, with a break-even of 25 million tons. Today, the Japanese are making 106 million tons of steel a year. They prognosticated in 1962 that in the following ten years they would increase their motor vehicle production from 500,000 to 5 million, and that is what they did by 1972. That is one of the reasons why they employ a system similar to the one we are advocating now; and one of the reasons why I am advocating this is because one Government will upset what another have put on the Statute Book—
Lord BESWICK: May I interrupt my noble friend? He was about to give one reason why he is advocating this, but is he aware that there is no difference between us here? We accept both the principle and a large part of the detail of the original Amendment and there is no argument about this at all. Would my noble friend indicate whether he finds my Amendment acceptable?
Lord RHODES: I am coming to that. I accept my noble friend's remarks as being a polite way of telling me to sit down, but I am so seldom on my feet that I shall take advantage of staying on them for a little longer, whatever the consequences. I was saying that one Government upset the actions of the Government who preceded them with almost stupid regularity, and we should adopt a system, perhaps something like our
862
budgetary system, which works by policy changes from one Government to another. Considering the form of words in this Amendment, I am satisfied that the Government have met handsomely the demands of the other place. The team who have been working on this Bill is one of the best I have seen in the House of Lords, one of the most painstaking and courteous. It has been a pleasure to listen to my noble friends in this team, and I say that not as a piece of flannelling but as a reminder that I look forward to debating the next Amendment which stands in the name of my noble friend Lord Beswick, and the one which follows it, which stands in my name, and I promise to move that one briefly.
Lord CAMPBELL of CROY: The Government appear to be replacing paragraph 1 of the original Schedule as it came to this Committee and later they will be seeking to replace paragraph 2 and to remove paragraph 3, so completely changing the urtext of the Schedule. We have been waiting since Wednesday to hear an explanation from the Government as to why this was being done, and the noble Lord has briefly explained today. So far as I can see, the effect of the new Schedule is to relieve the Government to some extent of what the other place was expecting the Government to contribute in the disclosure of information. In this paragraph, the Government are seeking a situation in which the Treasury can expurgate its forecasts before they are published. We listened very carefully to the noble Lord, Lord Beswick, explaining that the national interest could be involved if some of the forecasts were issued without expurgation, but this is to a great extent watering down what was clearly the purpose of the other place in the original text of the Schedule.
The Government will later be moving another Amendment which will also have the effect of relieving them of what had been expected in another place. This is a matter which I hope we shall be able to consider at Report stage, since we are looking at material which is new to the Committee and which has been explained only this evening. In the meantime, can the noble Lord tell us whether the text as he moved it and as twice amended—and with the reservation that there is, on one Amendment, the possibility of

863
redrafting by the Government—is the text to replace paragraph 1 to which the Government will adhere in later stages of the Bill both here and in another place? Or do the Government propose even more changes to their text later on?
Lord BESWICK: I feel that we should not exaggerate the changes made by the Amendment as against the original Amendment in another place. I should like briefly to state what those changes are. They are that alternative assumptions will be allowed on other matters as well as on policy changes and external events. This will enable alternatives to be used for pay and prices and other sensitive variables, as well as single published figures which could influence public behaviour; a fee will be charged for the use of the model by members of the public; forecasts are to be published not less than twice a year rather than quarterly; there is to be un to one year's grace before implementation of publication; likely margins of error are to be indicated where possible, but not standard errors which virtually cannot be calculated in a model like that of the Treasury.
Those are the main changes which are proposed and I do not feel that they should give rise to any suspicion. The noble Lord, Lord Campbell of Croy, asked whether we had in mind further changes in another place. I can tell him that, to the best of my knowledge and belief, there is no intention of making any changes, except the minor change to which I referred—that is the use of the word "aforesaid".
I am not quite certain what the noble Lord, Lord Kahn, was advising us to do. I hope he was suggesting that, on balance, it would be better to accept my amended version rather than the original version. I share his instinctive and old-fashioned objection to the use of the word "computer" in an Act of Parliament. I have asked whether it is a precedent and I am told that the wretched word appears in the Solicitors Act 1974, so we cannot object to it on principle. I was asked by my noble friend Lord Bruce of Donington whether the requirements would include estimates of capital expenditure. That would be covered by sub-paragraph (b) of the Amendment, but if it was the wish of the Committee
864
to make this absolutely clear I should be quite happy to consider an Amendment to that effect on Report stage.
10.25 p.m.
Lord BESWICK Lord BESWICK moved Amendment No. 292F:
Page 43, line 13, leave out paragraph 2 and insert—
". It shall be the duty of a Minister of the Crown with whom a body corporate enters into a planning agreement to participate with that body in demonstrating so far as possible, upon the application of that body, the relationship between the undertaking to which the agreement relates and the national economy."
The noble Lord said: This Amendment, dealing with the second paragraph of Schedule 4, again sets out to give a somewhat improved version of what was originally asked for. The second paragraph of Schedule 4 as it stands raises an issue of a somewhat different order from that raised in the first paragraph. It would impose upon the Government a resource requirement of quite formidable proportions, if they were to maintain models not only in respect of each planning agreement company, but also in respect of its markets, suppliers and sources of manpower. Even if it were possible for the Government to provide a subsidised service of this kind for the nation's major companies—which it is not—the Government have neither the resources nor the information available to undertake modelling work on this vast scale. The estimate given to me of the potential cost is that it could run into several millions of pounds a year. I do not believe that this is the intention of the movers, and I hope that my Amendment will he acceptable. I beg to move.
10.27 p.m.
Lord RHODES Lord RHODES moved Amendment No. 2921 as an Amendment to Amendment 292F.
In the proposed new paragraph leave out ("with whom a body corporate enters into a planning agreement") and insert ("who proposes to enter into, or has entered into a planning agreement with a body corporate").
The noble Lord said: I am with the Minister almost entirely, but there is one little difference and in all probability he will be able to concede it. When a Minister proposes an agreement with a firm he should make absolutely crystal

865
clear what is involved. The words in my Amendment try to give effect to that aim. If a firm go to the Treasury after an agreement has been mooted, the firm is entitled, before it commits itself, to get to know what it is all about. I beg to move.
Lord BESWICK: The noble Lord was so kind in his reference to my colleagues and myself that I cannot resist the temptation to accept his Amendment, and I do not intend to try to resist. Therefore, I agree that it should be an amendment to my Amendment.
Lord BESWICK Lord BESWICK moved Amendment No. 292G:
Page 43, line 19, leave out paragraph 3.
The noble Lord said: This Amendment is a somewhat more radical surgical operation. I hope that I have indicated by the Amendments to paragraphs 1 and 2 of the Schedule that the Government are prepared to take a constructive line. The suggestion here is that the Government should produce a "trade-off" matrix, and this implies that the Government should express their economic policy in numerical terms, substituting a series of numbers for complex priorities. Such a process is dependent on the ability of the Government to state the whole of the complex of value judgments implicit in economic policy in terms of a mathematical formulation. It also implies an ability to evaluate a whole range of hypothetical situations in such terms. Whatever the future may have in store for us—and I hope it has a lot of happy things in store for us—I think it is fair to say that Parliament and the Government have some way to go before they see the process of judgment and decision-taking being approached in this fashion. I therefore invite the Committee to approve this Amendment. I beg to move.
The Earl of BALFOUR: If Amendment No. 292G is accepted, can Amendment No. 293 still be moved?
Several Noble Lords: Yes.
The Earl of BALFOUR: I am not too sure about this, but I hope that it can, because I should like to hear what
866
the noble Lord, Lord Rhodes, has to say.
The CHAIRMAN of COMMITTEES: Yes, certainly the noble Lord can do that.
10.30 p.m.
Lord RHODES Lord RHODES moved Amendment No. 293:
Page 43, line 19, leave out paragraph 3 and insert—
("3.—(1) Not less than twice in each year commencing with a date not later than three years from the coming into force of this Act, the Treasury shall publish forecasts, produced with the aid of the model or of another macroeconomic model, with those levels of economic policy and other variables which best satisfy alternative sets of priorities of marginal changes in each economic variable, the priorities being expressed in quantitative terms, and the alternative sets of priorities being chosen as appears to the Treasury appropriate.
(2) From the same date as in subparagraph (1) the facility used to make forecasts which best satisfy alternative sets of priorities as specified therein, shall be available to members of the public to make forecasts with sets of priorities specified by themselves, the facility being available during office hours upon payment of such reasonable fee as the Treasury may determine.")
The noble Lord said: I cannot emulate the phraseology of the noble Lord, Lord Beswick. This Amendment seeks to establish that forecasts can and often do go wrong, and in the past when things have gone wrong we have lurched from one mess into another. This Amendment seeks to ensure that contingency plans should be at hand to cope with this situation. Time and time again it has been demonstrated that it is disastrous to react only when a crisis actually occurs. There should be available alternative options based on priorities which Ministers themselves have selected.
To back up what I have said, you can call in aid many instances where this situation has arisen. In recent years, within six months the 1970 Government made a U-turn in policy. House prices rose to the skies, while building costs were very low. And what happened? Building costs rose to join the prices for high-priced property due to the ability of speculative people to gamble in property. Take the textile cyclical boom that we are now suffering from. If there were optional plans that had to do with these arrangements and the escape clauses in GATT—to put forward a very simple

867
illustration—we should not be having the mess that we are having now.
Consider the simplicity of the statement made by the Chancellor of the Exchequer during the last Election. The Election was fought for a week on whether the inflation level was 8 per cent, 16 per cent, or, as it turned out to be, 25 per cent. I could go on, but it is late. I beg to move.
Lord BOYLE of HANDSWORTH: If the noble Lord, Lord Beswick, can give me just a moment, I hope that the Government will resist this Amendment. I say this on two grounds. First, I think the kind of work envisaged here is very much more suitable for a university department or a body like the National Institute of Economic and Social Research than as a duty on the Government to put in a Statute passed by Parliament.
Secondly, and perhaps more important, consider the words at the end of the first paragraph of this Amendment—
"and the alternative sets of priorities being chosen as appears to the Treasury appropriate."
Again I take the old fashioned view that when one is setting out in any official publication alternative sets of priorities this must be a matter for Ministerial responsibility. It cannot be a matter for something called the Treasury. As might be expected. We have heard tonight some critical remarks about the Treasury, as well as some critical remarks about economies.
As I am on my feet may I say that I do not agree with the remarks of the noble Lord, Lord Rhodes, about my noble friend Lord Kahn. I can think of at least three or four separate matters on which, if his advice has been heeded—like marrying the public housing programmes and the industrial programmes—in a number of respects we should be better off today. Granted that the Treasury and economists have often made errors and that information has sometimes been unnecessarily denied, I must say, for myself, I would rather settle for the large Amendment that we have just passed. I think this represents a major step forward in a new field, a major new development of policy. I would strongly advise this Committee to leave it at that on this occasion.
868
To my old friends on the Opposition Benches, I think there is something to be said for defeating a Government and deciding to take the consequences. I am bound to say that there can be such things as somewhat opportunist Amendments. To carry on with the last part and try to produce a substitute for the original third paragraph in the words moved would come close to the kind of opportunism which seems unwise.
Lord KAHN: While I agree with most of what my noble friend Lord Boyle of Handsworth has said, I am afraid that I cannot agree with him that the passage of this Schedule indicates any kind of progress. I have already made my comments on that. As regards this Amendment. I am bound to say that I have read it a considerable number of times and cannot make any sense out of it. I do not know what is meant by "levels of economic policy" or by "marginal changes". If by "marginal changes" is meant small changes, I would point out to the Committee that some of us some years ago in relation to defence expenditure took the line that what was called for was not a marginal reduction but a large reduction. I do not know quite how far it is expressed in "quantitative terms" but the really serious aspect of this Amendment, leaving aside what is meant by "levels of economic policy" is forcing the Treasury to give indications of what Government policy may be. First, it gives even more importance to the position of the Treasury in the Government that it ought to have. Apart from that, it is very wrong indeed to ask for public statements.
Here I can refer to what my noble friend Lord Boyle of Handsworth said about earlier economic forecasts from 1947 onwards. Anything that is published relating to alternative economic policies is bound to be read sometimes rightly and sometimes wrongly. If it is read rightly, very often it has a perverse effect and sometimes a favourable one as an indication of what Government policy is going to be. Looking at it in the obverse sense, if the Government want to produce a certain result they may give the wrong indication of their policy in order to produce the result they want.
Lord BEAUMONT of WHITLEY: I do not know whether Lord Rhodes is going to press this Amendment. I am

869
not competent to oppose the main arguments put forward by the noble Lord, Lord Kahn, but I do not think this Amendment should go by without a word being spoken against the views put forward by the noble Lord, Lord Boyle of Handsworth, on this and the previous Amendment. I do not think it is right that we should say that the Treasury cannot be given a duty to give us information about what they think would happen on various suppositions merely because suppositions might or might not a part of Government policy. If they will forgive me, I think that the noble Lords, Lord Boyle and Lord Kahn, in so far as they touched on this particular matter, were thinking in terms of a situation where the Treasury were still producing forecasts almost entirely geared to what the Government were going to do and that any slight variation about that might perhaps give the papers and the economic experts a hint as to what departure they were going to make.
The suggestion, as I see it, in the Amendments moved by the noble Lord, Lord Rhodes, by the Government and the whole of this Schedule, are completely different: it is that there should be two duties on the Treasury. The first explicity and implicity exists at the moment to serve the Government in forecasting what happens if Government policies are followed, or if various things happen which the Government foresee. The second is that in this Bill we are asking the Treasury to use the resources at their disposal for producing some real information, admittedly speculative in the sense that economic forecasting through a computer is a very fallible method. Nevertheless, we are asking that they should do their best to put at the disposal of the whole community the information that they have, and the expertise that they have, and allow people besides the Cabinet to make judgments about what effect different policies are going to have.
It is entirely right that this should happen and something we should support. Whether this is the right Amendment, whether some of the technical objections made by the noble Lord, Lord Kahn, are right, is another matter. I do not think the Amendment should go by without somebody saying that there are—and I have seen some noble Lords nodding their heads—some who
870
think that this is what the Treasury should be doing. It is in no way improper; it would in no way hinder the good government of this country and, indeed, would support it.
10.42 p.m.
Lord BESWICK: I am glad to follow the noble Lord. If he saw heads nodding about the desirability of information being made available, and the expertise of the Treasury being at the disposal of those who have to make decisions in various economic areas, those heads were nodding because without any doubt that is what we are seeking to do. There is no difference between us Here we are dealing with something which is somewhat different. We are here placing obligations which it would be difficult to carry out and, even if it were possible to compel the Treasury to carry out what is stated here, I doubt whether it would be of great value.
The Government accept that application of methods of optimal control to the economy is potentially a valuable tool of analysis. For some time now, work in this area has been proceeding in the United States. Most of this has been in the academic world although the Federal Reserve Board has succeeded with an application in a limited area. In this country my honourable friend Dr. Bray has been in the van of those concerned to develop applications for the United Kingdom. But it is our view that the development and application of these methods to large-scale economic models is still very much at an early experimental stage. So far as we know, no institution in the United States or the United Kingdom at present applies these techniques to a large-scale forecasting model and a very substantial amount of development work is required before useful practical applications might be expected. Our first objection is simply that it is quite wrong to commit the Treasury to produce an adequate solution to the substantial technical problems involved within a limited period of three years. It is in the nature of research projects that they may be unsuccessful even when substantial resources are committed.
Secondly, the extent to which it is desirable to commit major resources to this activity in the present state of knowledge must be a matter of professional

871
judgment. The devotion of more resources to the improvement of the basic forecasting model rather than to development of optimisation techniques is clearly an option which requires to be carefully considered.
The next statement that has been given to me is one which I am sure many noble Lords will accept. The solutions of any policy optimising procedures are only as good as the structure of the model which underlies them. In other words, the sum total of this is: let us walk before we run.
Lord BOWDEN: I am sure we can accept most of what the noble Lord, Lord Beswick, has said. But I think we ought to distinguish between the purpose of this exercise and what I call weather forecasting. If all that our computers do is to tell us what is going to happen, we can await events. We may get ready to flee from the oncoming storm. But the purpose of this exercise is to provide us with alternative courses of economic policy which we can decide in the light of the best information available. I would willingly accept that most of the forecasts which have so far been made, either by computer or otherwise, have turned out in the event to be wrong. It is the fact that the country has staggered from crisis to crisis, rather than the thought that the Treasury may be exposed to ridicule, as the noble Lord, Lord Kahn, has said, which really concerns me most. I believe that in so far as this can be done, it is a very worthy objective, although it may well be in the circumstances we are not yet able to do it. This is a matter of opinion and we might perhaps come to some agreement that this work should be encouraged by all possible means without committing the Treasury to achieving any particular results in the time specified in the Amendment.
Lord CAMPBELL of CROY: I do not wish to detain your Lordships at this hour. Some of us have been here more or less without moving since half past two this afternoon. But paragraph 3 having been removed at the behest of the Government, the noble Lord, Lord Rhodes, is now proposing a new one aimed to fit in with the replacement of paragraphs 1 and 2. Various speakers
872
in this debate so far have pointed out that this is a new method which, although the Americans have used it some way ahead of us, is not yet fully approved, but none the less could be of great assistance, not only to the Government but also to industry and those concerned with the economy in this country.
The noble Lord, Lord Boyle of Hands-worth, who earlier cautioned us on an Amendment about the dangers there could be in some forecasts being disclosed too early, in this case agreed that these operations could well be carried out but suggested they might more suitably be carried out at a university or some other establishment than the Treasury. The noble Lord, Lord Kahn, suggested that some of the wording in Lord Rhodes's Amendment might be altered. But I have the feeling that none the less at this stage it would be prudent to allow this new paragraph 3 to be inserted in the Bill to replace what has been taken out, on the understanding that its wording would be looked at again at a later stage and be subject to any changes such as the noble Lord, Lord Kahn, has suggested.
The noble Lord, Lord Beswick, told us that time was needed and that it might not be possible to carry out these operations as early as the noble Lord, Lord Rhodes, would wish. Again, the question of the starting time could be considered, if that is an argument. But it would be a pity to allow this provision to disappear completely at this stage and not to put in the paragraph which Lord Rhodes has proposed to replace the one that has been removed.
Lord BROWN: I think we are playing with fire. I can imagine the situation of the self-fulfilling prophecy if we include this paragraph in the Bill, whereby certain predictions are fed into the computer about the level of sterling in the market and so on, and by the time it gets out people will have taken all the actions which make a precipitous fall in sterling come true. I suggest that to go too far in this direction without knowing exactly what is going to happen as a result of all the information that is going to be released is extremely dangerous. We ought to go very cautiously and reject this paragraph because it might lead to dangers of which at the moment we have no idea.
Lord BESWICK: May I ask this of the noble Lord, Lord Campbell of Croy? He said that I had said we could not do this in the time-scale and he thought that nevertheless we ought to try. Is he proposing to lay down in an Act of Parliament that certain things should be done even though he accepts that within that time-scale it is very unlikely we can do them?
Lord CAMPBELL of CROY: No; the noble Lord has misunderstood me. I was suggesting the opposite: that an objection which the noble Lord, Lord Beswick, had raised—that this was something which could not be carried out in the immediate future and not as early as the noble Lord, Lord Rhodes, was contemplating—was not a reason for dispensing with it. One could look at the time-scale of the introduction of the system. That again would be something which could be looked at rather than simply to say, "We are not going to do this at all."
Lord BESWICK: We cannot just look at it. If this Amendment is accepted, we are imposing a legal obligation upon a Government Department to do something which apparently the noble Lord, Lord Campbell of Croy, has accepted could not be done within the time-scale.
Lord CAMPBELL of CROY: I am afraid the noble Lord is still not understanding me. I understood that this was an operation which could be carried out. The noble Lord, Lord Beswick, reckons that it could be carried out, but he says there would be difficulties about doing so in the near future. I am suggesting that this Amendment could be made and that this new paragraph, paragraph 3, could be incorporated into the Bill, subject to changes such as the starting time. I said at the beginning that in accepting it we should not be wedded precisely to the wording as it is at present. One of the suggestions that I made was that the question of the timing might still be left open if the objection which the noble Lord, Lord Beswick, has raised is a valid one which causes difficulty.
Lord HARMAR-NICHOLLS: If these words are written into the Bill, I do not see how government as we know it would be able to function. In theory, both sides of the argument are correct. The point which has been made by the noble Lord. Lord Rhodes, is very sound and has been
874
accepted. The information ought to be there and ought to be made public, but it ought not to be made public by the Treasury. The argument of the noble Lord, Lord Boyle, is also extremely sound. It is good that this information should be made available so that people could influence Government and make their contribution, but I do not see how Government could function if one were to give it the authority of coming from the Treasury. Indeed, one of the criticisms of the noble Lord, Lord Rhodes, is confirmation that this happens now to some extent. When he spoke about "U" turns, he meant that the responsible Ministers had been influenced by information which had been fed to them from the various Government channels. It is true that they have to face the criticism of making "U" turns and everything that goes with that.
One has tried to study over the years the form of government that is operated in this country today, and I should have thought that to have one's cards on the table facing upwards all the time is a very dangerous precedent. The information ought to be there when the universities get it, and any other organisation, such as those suggested by the noble Lord, Lord Boyle, should make it available. But do not give it the authority of coming from the Treasury because if a hint is given that it comes from the Treasury it is taken as a fact and is bound to influence what people do and the certain irresponsible actions which may flow from it. If we can arrive at a point where a little of both arguments is put into operation, I shall welcome it. However, we should not write the Amendment into the Bill at this stage. I should not feel happy about voting in support of that proposal.
Lord RHODES: This Amendment has had a good airing. I am not going to press it to a Division. It is accepted to a certain extent in America and is practised, I understand, by the Federal Reserve Bank. We have made a good deal of progress. Both Houses have shown their dissatisfaction with the present method of forecasting. If my Amendment has done that it has achieved a great deal. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 4, as amended, agreed to.
Schedule 5 [Advisor Committees]:
The CHAIRMAN of COMMITTEES: Before I call Amendment No. 296A I should point out that if this Amendment is agreed to I cannot call Amendment No. 297.
Lord MELCHETT: I spoke to Amendment No. 296A with No. 163A. I beg to move.
Amendment moved—
Page 44, line 7, after ("by") insert ("the authorised representative of").—(Lord Melchett.)
Schedule 5, as amended, agreed to.
Remaining Schedules agreed to.
House resumed: Bill reported with the Amendments.

LONDON TRANSPORT BILL
Reported from the Select Committee with Amendments.