Lords Sitting of 30 June 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 Ely.

OIL PLATFORMS: BUILDING SITES
Lord CAMPBELL of CROY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how many building sites for offshore oil platforms are available or are being prepared in the United Kingdom without an order for a platform to be built there having yet been placed.
Lord LOVELL-DAVIS: My Lords, five sites—one each at Portavadie, Campbeltown and Burntisland and two at Alness—have planning permission for the construction of production platforms and have not yet won orders. My right honourable friend the Secretary of State for Scotland has indicated that he is prepared to give planning approval for a sixth, at Hunterston. The development of the site at Portavadie is being financed
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by the Government under the Offshore Petroleum Development (Scotland) Act in advance of receipt of an order.
Lord CAMPBELL of CROY: My Lords, I am grateful to the noble Lord for that Answer. May I ask him whether the Government are concerned that orders have been fewer than had been expected, as this probably denotes hesitation over developing marginal oilfields because of the Government's policies on taxation and 51 per cent. participation?
Lord LOVELL-DAVIS: My Lords the fact is that we now expect fewer platforms to be ordered than we did when we made the statement on 12th August 1974, Construction sites for concrete production platforms. There are a number of reasons for this downturn. Increasing costs, for example, have caused operating companies to reappraise their development plans and further appraisal, drilling and increased knowledge of the geology have caused plans to be modified. Nevertheless, the platform market still represents a significant opportunity for British industry and one which we are determined to grasp, not only because of the value of the platforms themselves but also because of the considerable value of the equipment and services associated with the platforms. I do not accept the second part of the noble Lord's supplementary question.
The Earl of LAUDERDALE: My Lords, would not the Minister agree that exploration rigs have been leaving the

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North Sea for continental shelves in other parts of the world, where the fiscal disincentives are less and the fiscal incentives are better?
Lord LOVELL-DAVIS: My Lords, if the noble Lord will kindly refer to my Answer to a similar Question on Friday, he will have my views on this matter.
The Earl of LAUDERDALE: My Lords, I have seen that Answer and it is because it seemed inadequate that I am now pressing the matter.
Lord CAMPBELL of CROY: My Lords, on that point about rigs, may I ask the noble Lord whether the Government are not concerned about the departure from the British sector of drilling rigs, such as the six which I mentioned on Friday, which are reported to have moved to Norwegian, French and Irish waters?
Lord LOVELL-DAVIS: My Lords, that is altogether another question. The Question I was asked by the noble Lord concerned building sites.

INDEPENDENT AIRLINES
2.43 p.m.
Lord MAIS: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will give an assurance that no irrevocable steps will be taken which will affect the status or the operation of independent airlines in general and British Caledonian Airways in particular without prior reference to Parliament.
The MINISTER of STATE, DEPARTMENT of INDUSTRY (LORD BESWICK): My Lords, my right honourable friend the Secretary of State for Trade is currently studying a Report from his officials on the Civil Aviation Policy Review initiated last year. It is his intention to make a statement to Parliament as soon as possible setting out his conclusions. Any changes in policy which my right honourable friend may decide to make will need to be reflected in new policy guidance for the Civil Aviation Authority and in
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accordance with Section 3(3) of the Civil Aviation Act 1971. Any such guidance would require approval by each House of Parliament before it became effective.
Lord MAIS: My Lords, I am grateful to my noble friend for that reply. May I press the point that I hope Her Majesty's Government appreciate that British Caledonian Airlines came into being as a result of the Edwards Committee Report and that it was supported by all shades of opinion in all political Parties?
Lord BESWICK: My Lords it is undoubtedly the case that this airline has stamped its own personality on its operations and that personality is found by many people to be agreeable. There was, of course, one aspect of its coming to life which was disagreeable and my noble friend will no doubt have that in mind.
Lord KILMANY: My Lords, will the noble Lord, who knows a great deal about these matters, bear in mind that many people who have had experience of travelling both on British Caledonian and British Airways find that the service given by British Caledonian is the better of the two?
Lord BESWICK: My Lords, I was prepared to give a pleasing answer to the noble Lord until he came to the last part of that supplementary question. The fact of the matter is that both airlines provide good service and no doubt each helps the other to maintain high standards.
Lord KINNAIRD: My Lords, is the noble Lord aware that should he travel incognito—and I stress incognito—by British Airways he will find that the service may be good but the manners very much to be deplored, while if he travels incognito on British Caledonian he will meet with the utmost co-operation and good manners?
Lord BESWICK: My Lords, I think I have done as much travelling as most noble Lords and I would say that the standard of both companies is very high.
The Earl of PERTH: My Lords, will the noble Lord take into account in this review that at the present time all airlines throughout the world are going through great difficulties and that if, for example, British Caledonian is in need of help, this is not unusual and should not be

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held against the company? May I further ask him to reiterate to the Government the wish of all travellers to Scotland that there should be competition?
Lord BESWICK: My Lords, I do not think it is a question of needing help. That was not the reason why this review was held. There were certain circumstances attaching to the formulation of the route pattern which aroused criticism at the time, and I have no doubt that that was one of the reasons why the review was put in train.
Lord BROCKWAY: My Lords, is my noble friend aware that many of us who travel on British Airways, because it is a national service, greatly appreciate the service which is given by that airline?
Lord BESWICK: My Lords, I am happy to think that it is from my side of the House that praise is being given to a publicly owned air service in this country.
Lord CAMPBELL of CROY: My Lords, besides the good work done by British Airways, as British Caledonian has made a notable contribution to air services, may I ask the noble Lord to give an absolute assurance that the Government will not take precipitate action without Parliament being consulted?
Lord BESWICK: My Lords, I think I said earlier that the review was initiated last year. I scarcely think that is precipitate action.
Lord SLATER: My Lords, is my noble friend aware that, regarding this issue, to many of us it seems that we are being taken back to a previous occasion in another place when everything was pointed directly towards the efficiency of the independent airlines compared with nationalised airlines? I agree with my noble friend that, so far as British Airways is concerned, compared with the independent airlines, we ought to look at them in unison and take them as one in view of the service they are endeavouring to give.
Lord BESWICK: My Lords, the fact is that the service offered by British Airways compares favourably with any other company in this country, and any other company operating in any other part of the world. It is also true that British Caledonian have made, in the words of
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the noble Lord opposite, a notable contribution. All these factors have been taken into account.
Lord THOMAS: My Lords, is the noble Lord aware that, among those who run independent airlines, there is what, to my mind, seems a justifiable fear, that in view of the massive over-equipment of British Airways there is a danger of the Government showing more favouritism to the nationalised airline than they show to the independent airlines?
Lord BESWICK: My Lords, I would direct the noble Lord's attention to Section 3(1) of the 1971 Act. If he will cast his mind back as to the circumstances in which that subsection was framed, he probably would not emphasise the point that he has just made

DRIVING LICENCES AND STATUTORY INFORMATION
Lord PLATT: 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 whether they are aware that the new driving licences and the forms of application for them do not conform to certain provisions of the Road Traffic Act 1974 (especially Sections 2(1)(b) and 3 of Schedule 3 (disclosure of medical information concerning prospective disability)); and if so, whether they intend that those provisions shall not be brought into effect.
Lord MELCHETT: Yes, my Lords, the Government are aware of it, but the forms do not need to conform yet. The Government plan to introduce the new provisions on 1st October 1975 for driving licences coming into effect from 1st January 1976. New application forms and licences are being printed and will be available then.
Lord PLATT: My Lords, I thank the noble Lord for his reply. May I ask whether Her Majesty's Government are going to inform all registered medical practitioners of their new duties in disclosing confidential information to the Secretary of State?
Lord MELCHETT: My Lords, while not entirely accepting the implications behind the noble Lord's question, I can tell him that steps are in train to make sure that all medical practitioners will be aware of the new situation when these new forms and licences are introduced.
Baroness WOOTTON of ABINGER: My Lords, can my noble friend say whether, when this new provision comes into effect, it will do away with the present situation where, on medical grounds, a person can be refused insurance by an insurance company, but still drive somebody else's car?
Lord MELCHETT: My Lords, I am afraid that I do not know the answer to that question. If I may, I shall write to my noble friend.
Lord DOUGLASS of CLEVELAND: My Lords, can my noble friend tell us what is the purpose of requiring this new information?
Lord MELCHETT: My Lords, the new information is needed in conjunction with the new licences, which will run until the holder is 70 years of age, to make sure that the Secretary of State is informed when a person has an illness which is likely in the future to make him unfit ot drive.
Lord HAWKE: My Lords, is the noble Lord correct in saying that these new forms of licence will come in in 1976? Last night I was shown a new licence issued to one of my children which looked remarkably new and which had a code on the top of it, and anybody could discover the holder's age.
Lord MELCHETT: My Lords, the noble Lord is referring to the next Question. There is a new form of licence issued at the moment which is not a till 70 licence. The till 70 licence will be introduced next year.
Lord LEATHERLAND: My Lords, will the new provisions impose any restrictions upon people merely on account of age, or will such restrictions as are imposed have regard both to age plus medical incapacity?
Lord MELCHETT: My Lords, the only difference age will make is that after the age of 70 people will be required to apply for a licence after a shorter
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period of time, between one, two or three years. There will be no other restrictions.
Viscount DAVENTRY: My Lords, may I ask the noble Lord what happens after the age of 80?
Lord MELCHETT: My Lords, nothing different from what happens after the age of 70.
Lord DOUGLASS of CLEVELAND: My Lords, may I ask whether there is any statistical evidence to show that such measures are necessary?
Lord MELCHETT: Yes, my Lords, the saving in public expenditure is very considerable.
Baroness WOOTTON of ABINGER: My Lords, will my noble friend be good enough to give the answer to my previous question—namely, will he find out whether, under the new regulations, it will no longer be possible for a person who can get no insurance cover for driving his own car, to be able to drive other people's cars in spite of his medical disability?
Lord MELCHETT: My Lords, I will endeavour to find out that information.
Lord SLATER: My Lords, can my noble friend tell me why applications for driving licences have to be made to the main centre in Wales? On previous occasions we were able to make applications to the transport section of the local authority in each county or metropolitan borough. What is the reason for the change?
Lord MELCHETT: My Lords, that is rather a different question. The reason for the change is to reduce the number of staff in London and to effect economy.
Lord MOWBRAY and STOURTON: My Lords, can the noble Lord tell me whether my memory is totally deficient? Do I not remember, when we dealt with the appropriate Bill concerning this matter, that regarding the question of the noble Baroness, Lady Wootton of Abinger, it was stated that if you are not entitled to a licence, you are not entitled to drive somebody else's car?
Lord MELCHETT: My Lords, this is a different question.

DRIVING LICENCES: AGE IDENTIFICATION
2.50 p.m.
Lord PLATT: 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 whether they are aware that the holder of a driving licence of the new type is allowed to clip off the corner revealing his age but that the "driver number" at the top of the licence is a simple code from which the date of birth can at once be ascertained; and whether this does not create a false impression of confidentiality.
Lord MELCHETT: My Lords, the date of birth is needed to distinguish between drivers of the same name whose records are held at the Driver and Vehicle Licensing Centre. The date appears in full only on the first new-type licence issued to drivers so that they may check its accuracy and avoid later problems of identification. It remains on this and later licences as part of the identifying driver number but in scrambled form to make it less obvious at a glance. There is no obligation to show one's licence to anyone except the police or the courts: both have powers to ask for the date of birth if the licence is not produced.
Lord PLATT: My Lords, may I thank the noble Lord for that highly unsatisfactory Answer? Is the noble Lord aware that the same object would be achieved by putting the date of birth boldly on the licence and not pretending that something else is being done? My Lords, I had another point in mind which I wanted to put. I cannot quite recall it at the moment and I will leave the matter there.
Lord MELCHETT: My Lords, I am gratified to think that such an unsatisfactory Answer has left the noble Lord speechless. There is no attempt at pretence or to mislead anybody. The date of birth is put quite clearly at the bottom of the licence and can be removed if the licence holder wishes to do that. The date of birth is also used in the driver record number and is merely "scrambled" slightly so that a person looking at it cannot immediately tell the date of birth.
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However, it is necessary that the date of birth should be used in this number.
Lord PLATT: My Lords, I am grateful to the noble Lord. Having remembered my second point, may I ask him whether he realises that the only person to whom I have ever shown my licence is a policeman?
Lord MELCHETT: If that is so, my Lords, I fail to understand where the issue of confidentiality arises. As I have said, the police already have the power to require a driver to tell them his date of birth if there is a failure to produce the licence.
Viscount AMORY: My Lords, would the noble Lord also remember that the date of my birth, going back to four days before the end of the last century, is a never-ending source of satisfaction and pride to me?

EUROPEAN PARLIAMENT
2.52 p.m.
The LORD PRIVY SEAL (Lord Shepherd): My Lords, with the leave of the House I shall make a Statement about business this afternoon. It had been my intention to move a Motion designating Lords Members of the European Parliament; but following a postponement of the equivalent Motion in another place, it has been agreed through the usual channels not to take my Motion this afternoon. Instead, it will be taken on Thursday. I apologise to any noble Lords who may be inconvenienced by the change of business.
The Earl of LAUDERDALE: My Lords, may I ask the noble Lord whether he is aware that, although I appreciate his apology, I learned officially about this change when he was good enough to ask my noble friend Lord Alport to give me a message at ten minutes to two. Some days ago I put down an Amendment to this Motion, and Notice of this Motion has been in italic form on the Order Paper since last Wednesday. Might it not have been reasonable that those other people involved should perhaps have been consulted and not only the usual channels?
Lord SHEPHERD: My Lords, I know the noble Earl's view over many years about the usual channels. I must admit

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that on this occasion unfortunately the usual channels failed in their customary service in notifying those noble Lords involved in the change of business. That is why I extended my apologies not only to the noble Earl but to the House as a whole. The fact is that as a consequence of consultation the decision was taken only comparatively late this morning, and it was taken on the basis of the convenience of the House.
Lord BYERS: My Lords, can we take it that this will be the first business on Thursday?
Lord SHEPHERD: My Lords, if I have anything to do with it, yes.
Lord AVEBURY: My Lords, as I arrived this afternoon with the express intention of opposing this obnoxious Motion, could the noble Lord say why it has been postponed?
Lord SHEPHERD: My Lords, I am not certain which Motion was "obnoxious"—my own, or that of the noble Earl. However, the decision was taken after consultation because another place had yet to debate this matter, and we thought it would be very much in the interests of our own discussion if this matter was finally dealt with in another place, so that we could then take account of our own position in the light of the debate and the decision taken in another place.
Viscount AMORY: My Lords, I think the general feeling will be that this question of the selection of representatives for the European Parliament in the long term is most important. If this slight postponement gives time for more thought to be given to the right long-term way of doing it, it will be most welcome.
Lord SHEPHERD: My Lords, whether or not Thursday is the right time to reach a long-term decision, I hope the House will appreciate that the new European Parliament sits on 7th July and I am sure it would be the wish of the whole House that the British representation is there to take part on this very important occasion.
Lord BALFOUR of INCHRYE: My Lords, the Leader of the House very graciously apologised to noble Lords who had been inconvenienced—those who, like myself, have come a long distance and
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made a difficult journey in order to get here today for the Motion, which we then find at the last moment has been postponed. Can the noble Lord give a positive guarantee that the usual channels will flow uninterruptedly and without difficulty, and that there will be no problem in coming to a conclusion by Thursday? It would be for the convenience of the House to know now, positively, that Thursday is to be the day.
Furthermore, may I just remind the noble Lord that since 1972 my noble friend Lord Lauderdale and myself, together with several other noble Lords, have protested at this constant monopoly of the usual channels for this selection of members for the European Parliament. Had the suggestions which we have made in the past been adopted previously, the usual channels might not today have found themselves in these difficulties. Therefore, may we please know whether the whole question of the usual channels will be reviewed, in addition to the consideration of the Amendment which the noble Earl, Lord Lauderdale, has put down and which many of us wish to support?
Lord SHEPHERD: My Lords, the usual channels are such an obscure body that I hesitate to say whether or not it could be reviewed; but I can give the noble Lord the assurance that this debate will take place on Thursday because, as I said earlier, the European Parliament assembles on 7th July and I would think the whole House would wish to see the British delegation present. This is not perhaps the occasion to debate the subject; we can do that on Thursday. I have made a mere business Statement, indicating the change of business. I would think it best to leave the matter there.
Lord WIGG: My Lords, the noble Lord the Leader of the House expressed the view that it was the wish of the whole House to have the British represented at Strasbourg. May I disillusion him? I, for one, would be a party to it only if the delegation followed historical precedent attending in their shirt-tails and with a halter round their necks.
Lord SHEPHERD: My Lords, when one speaks of "the whole House", one always knows there must be some exceptions.

LONDON TRANSPORT BILL
Read 2a, and committed to a Select Committee.
NEW TOWNS BILL
Read 3a, and passed.

FAIR EMPLOYMENT (NORTHERN IRELAND) BILL [H.L.]
2.59 p.m.
The PARLIAMENTARY UNDER-SECRETARY of STATE, NORTHERN IRELAND OFFICE (Lord Donaldson of Kingsbridge): My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read 3a.—(Lord Donaldson of Kingsbridge.)
On Question, Bill read 3a.
Lord DONALDSON of KINGSBRIDGE Lord DONALDSON of KINGSBRIDGE moved the Amendment:
Page 3, line 26, at end insert:
"( ) At least one of the members of the Appeals Board shall be a barrister or solicitor of not less than seven years' standing."
The noble Lord said: My Lords, at the Report stage I undertook to move an Amendment in these terms clarifying the Amendment which the noble Lord, Lord Belstead, had asked for. I now beg to move it. Its effect is that one member of the Fair Employment Appeals Board will be legally qualified and that legal qualification be defined, as it is in other Bills, to mean a barrister or solicitor of not less than seven years' standing. I think this Amendment meets the wish of the House as expressed on Report stage, and I beg to move.
Lord BELSTEAD: My Lords, the Amendment which the noble Lord has moved does indeed meet the point which I made on Report and I express my gratitude to him for doing this.
On Question, Amendment agreed to.
Lord DONALDSON of KINGSBRIDGE: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Donaldson of Kingsbridge.)
On Question, Bill passed, and sent to the Commons.

HOUSING FINANCE (SPECIAL PROVISIONS) BILL
3.1 p.m.
Report received.
Clause 6 [Rates—supplementary]:
Baroness YOUNG Baroness YOUNG moved Amendment No. 1:
Page 5, line 34, leave out subsection (3).
The noble Baroness said: My Lords, in the absence of my noble and learned friend Lord Hailsham of Saint Marylebone, I beg to move Amendment No. 1. This and the following Amendments were suggested by the Public Bill Office as being consequential on the Amendments that were passed during the Committee stage of the Bill. The first Amendment is to leave out a subsection because Clause 3, giving power to charge the ratepayers, was omitted in Committee. I beg to move.
Lord SHEPHERD: My Lords, the House will be grateful to the noble Baroness for having moved these Amendments on behalf of the noble and learned Lord, Lord Hailsham, who I believe is now sitting judicially. These Amendments are consequential on, I think, an error of judgment of your Lordships' House in Committee. I would not seek to oppose them now. We shall have to consider them and all the others when the Bill is returned from another place. But I thank the noble Baroness for helping the House in putting some of the errors a little straighter than they were.
On Question, Amendment agreed to.
Baroness YOUNG: My Lords, I beg to move Amendment No. 2, which also is consequential.
Amendment moved—
Page 5, line 43, leave out from ("surcharge") to end of line 1 on page 6.—[Baroness Young.]
On Question, Amendment agreed to.
In the Title:
Baroness Young: My Lords, once again this Amendment is consequential. It has been included, again, on the advice of the Public Bill Office. I beg to move.
Amendment moved—
Line 5, leave out from ("made;") to ("and") in line 8.—[Baroness Young.]
On Question, Amendment agreed to.

BRITISH LEYLAND BILL
3.3 p.m.
Lord BESWICK: My Lords, I beg to move that this Bill be read a second time. May I first remind the House of the events which led to this Bill, before I describe its purpose. British Leyland approached the Government early in December for support for the company's longer-term investment programme. At that time the motor vehicle industry, not just British Leyland, had been beset by especial difficulties. Higher oil fuel costs, the increased cost of materials, economic uncertainties and inflation had all contributed to an unprecedented decline in major car markets throughout the world. Nearly all major car manufacturers had resorted to redundancies, short-time working or lay-offs. The inevitable result was a sharp decline in sales, revenue and profits—and an increasingly fierce competitive environment.
In December last year, Her Majesty's Government responded to British Leyland's request by deciding to appoint a high-level team, led by Sir Don Ryder the Government's Chief Industrial Adviser, to advise on British Leyland's situation and prospects. The team of inquiry worked intensively for a period of three months. The team supplemented their own considerable expertise by calling upon professional support services. Members of the team had meetings with members of the board and senior executives of British Leyland and visited nearly all the Corporation's plants. They also met with trade union representatives, including representatives of British Leyland shop stewards. The team's report was submitted to the Government on 26th March.
Following consideration of that report and its recommendations, my right honourable friend the Prime Minister made a Statement in another place on 24th April outlining the Government's decisions. My right honourable friend explained that the Government accepted the report's proposals as a basis for future policy. The report recommended that the vehicle production industry ought to remain an essential part of the United Kingdom's economic base and that British Leyland should, therefore, remain a major vehicle producer. Urgent action was required to enable the company to compete effectively in world markets, and in
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particular the inquiry team identified an urgent need for a large capital investment programme. They concluded that most of the money needed could be provided only by the Government, and they argued that there was an overwhelming case for this to be done. The Government accepted these arguments in the light of the significance of the company to the national economy. British Leyland is one of our biggest exporters. The company employs nearly 170,000 people and it provides employment elsewhere for several hundred thousand more. The balance-of-payments implications are enormous and, apart from lost exports, the failure of the company would undoubtedly mean massive additional imports.
My Lords, there have been a number of developments since that Statement was made. The company has co-operated with the Government by implementing the report's proposals for internal reorganisation. Many new appointments have been made within the company, including the important posts of managing director of each of what the report describes as four new businesses: in other words, separate profit centres for each of the four main operations: cars, trucks and buses, international and special products. Progress has also been made in other areas. In particular, the preparatory work has been done to secure the necessary approvals for a Scheme of Arrangement with the object of reconstructing the finances of the company. Sir Don Ryder's team recommended this Scheme of Arrangement as the best way of proceeding, and I will describe the Government's role in this in a moment. A document setting out the scheme has been sent by the Board of British Leyland to all the company's shareholders and convertible stockholders. This document contains the unanimous and strong advice of the British Leyland Board to shareholders that they should vote in favour of the scheme. Shareholders will meet on 14th July and if, as I expect, they give their approval to the scheme it will be necessary to secure the sanction of the Court afterwards.
The Bill before us provides authority for the Government to make an offer to existing shareholders in the company and subsequently to participate in a rights issue. This is an essential part of

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the implementation of the recommendations contained in Sir Don Ryder's report. The report, as I have already said, recommends that large amounts of money from external sources will be needed over the coming years and that a large proportion of this should be made available from public sources. Between now and September 1978 it is envisaged that the company will require a total of £900 million, a figure which incorporates the team's own assumptions about the rate of inflation over that period. Two hundred million pounds of this is expected to be provided by overdraft facilities. A further £200 million is to be provided by enlarging substantially the equity base of the company. This portion will constitute the first stage of new finance and it is this part with which the Bill before us today is concerned. It is intended that the remaining £500 million will be provided by way of long-term loan capital, and I shall say a little more about this later.
In view of the size of the new equity capital of £200 million which the team of inquiry thought necessary, the team also recommended that present shareholders should be given an opportunity to sell their shares. They recommended that the Government should offer 10p per existing share, which the team considered a fair price. Although the British Leyland Board made an effort to get the Government to increase this price, the Board have now recommended shareholders to accept the Government's offer of 10p per share. The Board have also said that on the basis of an examination by the company's auditors, they do not believe that shareholders could expect with confidence to receive any payment in respect of their shares in the event of liquidation. The Bill before us therefore provides for the Government to spend up to £65 million on acquiring those shares owned by existing shareholders and those to which convertible unsecured loan stockholders would be entitled if they exercised their right to convert.
Under the proposed Scheme of Arrangement a new company, British Leyland Limited, will be formed with an authorised capital sufficient to permit an offer for the existing share capital of BLMC and a subsequent rights issue. When the capital has been reconstructed it is proposed that the £200 million of new
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capital should be raised by way of a rights issue of new ordinary shares of a nominal value of 50p each at £1 per share. The Government will underwrite the issue to shareholders who have not taken up the offer for their shares and will themselves take up the remainder of the issue to a limit of £200 million. The Government expect as a result to become the holder of a majority of the shares in the new company, but clearly the extent to which the £265 million will be expended will depend upon the extent to which shareholders and convertible loan stockholders, if entitled, accept the offer for their shares and do not take up the rights issue offered to them.
My Lords, there have been suggestions that in all this the Government should have proceeded at a more leisurely pace, but I am afraid that these situations do not normally allow the luxury of lengthy discussion. This company has to survive in a highly competitive environment and the timing of Government action is subject to these disciplines. The harsh fact is that it will be a very considerable challenge to put this company on a sound and profitable basis and that each day of delay will make the task harder.
However, although the situation is urgent, the inquiry team accepted the need for safeguards when such large sums of public money are concerned. It is intended, therefore, that arrangements for scrutiny will be worked out between the National Enterprise Board, once this new body has been set up, and the company. There will also be close contact with the Department of Industry through the new system of planning agreements. Sir Don Ryder's report drew attention to the importance of improved industrial relations in the future and the need to make more productive use of both existing and additional capital investment.
The implications of that are paramount. Progress of the capital expenditure programme and the injection of new finance by the Government will be staged and each stage will depend on a tangible contribution by the management and work force to the improvement of industrial relations and productivity. The Prime Minister has made it clear that this is a condition to which the Government attach supreme importance. Following the initial provision of £200 million of new equity there will be annual review

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points during the period 1976 to 1978. That portion of the £500 million of loan capital to which I referred earlier will be made available in three stages. The release of each tranche will be conditional on satisfactory progress having been made.
My Lords, in this connection I should draw the attention of noble Lords to the report's emphasis on the fact that British Leyland's success will depend most of all on the skills, efforts and attitudes of its employees. Unless those skills are fully and constructively applied, then all else is lost. The inquiry team identified in this industry the same factor as is becoming evident elsewhere: that the alternative to constant confrontation was increasingly constructive collaboration. I have little need in this House to argue the merits of industrial democracy. All those—and there are many—who have industrial experience, realise that this is the path along which we must go. The speed of advance, the precise method of advance, are matters for discussion, but the principle is inescapable. The report proposes that a new structure of joint management/union committees should be set up to provide a forum in which representatives of British Leyland's workers can contribute effectively to improving the company's efficiency. Discussions on setting up these committees have already begun within the company.
The Government's intentions in this whole matter are clear. We acted swiftly to seek expert advice and have accepted the advice given. The remedy will make a heavy call on public expenditure, but we cannot will the end and deny the means. This Bill provides the means towards an end which I hope we can all share. My Lords, I beg to move.
Moved, That the Bill be now read 2a—(Lord Beswick.)
3.17 p.m.
Lord ABERDARE: My Lords, the House will be grateful to the noble Lord, Lord Beswick, for having explained this Bill in detail and for having given us further information, in particular about the various financial arrangements concerned with the shareholding and the reconstruction of the company. This is, of course, a Money Bill and therefore your Lordships have very little chance of
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doing much about it on this occasion other than debating some of the principles that underlie it.
For my part, I recognise straight away that, as the noble Lord has explained, there was a need for Government action. The noble Lord did not draw attention to the fact—although he might well have done—that we faced a situation of a not too different kind with the Rolls-Royce crisis, and clearly there was a need for the Government to take action in the case of British Leyland. There are those who would disagree with that view, and say that British Leyland should have been allowed to go to the wall. To me, that hardly seems to be a credible proposition. The noble Lord has himself told us that there are some 170,000 workers employed by British Leyland and that a considerable number of other workers are employed by other firms which supply goods and services to British Leyland. Moreover, there is no doubt that British Leyland makes a very large contribution to our export performance and, per contra, the import implications of allowing British Leyland to go out of business would have been extremely severe. Accepting that something has to be done, the question that remains to be asked is: what should be done? It is there that we have criticisms to make of the Government's action.
The report of the committee of Sir Don Ryder—or should we call him (I am not sure) the noble Lord, Lord Ryder?—has been accepted by the Government and is implemented in this Bill. It requires the expenditure over the years of an enormous sum of money. The noble Lord took us over the years up to 1978, but going as far ahead as 1982 the sum envisaged and the total expenditure required to finance the Government's plans for British Leyland at inflated prices is £2,800 million, half of it, according to the Ryder Report, to be found by profit generated by the company and half of it by the taxpayer—and this at a time when we should surely be seeking to reduce and not increase public expenditure.
This is indeed a huge sum of money; £1,400 million is double the £700 million that is available to the National Enterprise Board in toto, and it dwarfs the petty £100 million that the Welsh Development Agency has to put up with.

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It is an enormous commitment of public resources to this one company. Even this sum is arrived at only on certain assumptions. For example, the Ryder Report assumes that the rate of inflation for this year, 1975–76, will be 15 per cent., reducing to 12½ per cent. in 1976–77 and to 10 per cent. in 1979–80. Let us hope that this will come about, but the assumption of 15 per cent. for 1975–76 seems wildly improbable, when at the present moment inflation is going ahead at something over 30 per cent. If these assumptions are not true, then the figure for the investment of public money will be even greater.
The Government have swallowed the Ryder Report, hook, line and £2,800 million, and we are critical that there seems to have been no attempt to consider and to cost any alternative plans for British Leyland. Surely the committee under Sir Don Ryder's chairmanship should have produced some costed alternatives for the Government to consider, which would allow them to make a final choice in full possession of all the facts and all the courses that might be open to them. Obviously, every alternative has its drawbacks, but there is also no doubt that the present solution adopted by the Government has the very serious drawback of its vast expense. Without doubt there could have been no more expensive solution, and one wonders whether it would not have been right for other solutions to be carefully considered before committing this vast sum of money.
It also perpetuates a large conglomerate that has not so far been able to work properly as a single unified business. I believe that there was a feeling on the shop floor at British Leyland of increasing dangers ahead, and a new willingness to co-operate in policies that would have pulled the company together. But I am afraid that the result of the Ryder report and the Government's acceptance of it may well result in a feeling of relief and false confidence that will damage the future prospects for the company. The Government have come in with their bottomless purse and there is the feeling, "We're all right now, Jack. No need to worry about redundancy or overmanning. All will be right in the end." I believe that this very dangerous attitude of complacency
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may well overtake British Leyland as a result of this Bill. But we find it hard to judge, as we have no details of any possible alternative plans and what they would cost. I believe that the Ryder committee should have presented to the Government alternative plans, properly costed, to enable them to judge between the merits of those plans, so that in due course they could come to Parliament with clearly indicated alternatives and the reasons why they had adopted the one that they have.
Presumably, the Government are confident that the ultimate goal fixed by the Ryder Committee for British Leyland is attainable. Again, this is very difficult for us to judge because, for perfectly understandable and right reasons a number of vital chapters of the report containing information which is commercially delicate have been omitted. At the same time, it makes it very difficult for those of us who are trying to judge whether or not the commercial judgment exercised by the committee is right. Certainly, on their assumptions, the outlook for the future is very rosy compared to what has happened in the past. Profits are expected to increase from an average of 6½ per cent. in 1968–74 to almost double, 11 per cent., in 1981–82; the average rate of return on assets is expected to increase from 9·6 per cent. in 1968–74 to double, 19·6 per cent., in 1974–82; and British Leyland is expected to increase its sales within the European Economic Community by 62 per cent. by 1980. These are very ambitious goals, and all this at a time when car cales are falling, inflation is rising, competition within the European Community is intense and difficulties surround the future of the company. It certainly seems a very ambitious programme on which to invest £2,800 million.
There is another factor that could potentially wreck these plans; that is, the future of industrial relations within the company. The Ryder committee state blandly that there must be a reduction in manhours lost through industrial disputes and more realistic manning levels. I do not think anybody would disagree with those two statements. They suggest arrangements for greater involvement of the employees in the company's affairs. I agree with the noble Lord that we would

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certainly welcome this experiment in what he called "industrial democracy", although some of us have had our differences as to what it really means. Certainly, we would hope that this venture in the new form of industrial co-operation—what I think the noble Lord called "constructive collaboration"—will succeed. Nevertheless, the company has not had a happy past history of industrial relations, and it is not always the best recipe for negotiations over wage claims when it seems that the Government with their seemingly bottomless purse stand behind the company's management.
My Lords, the Ryder Committee suggested periodic reviews of the contribution by the work force to improving British Leyland's efficiency. This was mentioned also by the noble Lord who referred to the tangible contribution that the work force and the management should put into the company's future. I wonder how this will really work out. How can that contribution be assessed? What will be the criteria for assessing the contribution, and if it is considered inadequate what happens then? Do the Government refuse to put up further money, and will the company then start to fall back into difficulty again? If the forecast of the Ryder committee is correct and this capital is required for the future of the company, what is to happen if that capital is not forthcoming because a tangible contribution to industrial relations is not made by either the work force or the management?
I find it a difficult concept to understand, although one with which I am in very great sympathy, because unless a sense of realism is brought into the affairs of British Leyland—if the overmanning which exists at present is not reduced and if there is not greater cooperation between the workforce and the management—then however much money the Government put into the company they will merely be throwing good money after bad. For these reasons we are very far from happy at the Government's complete acceptance of the Ryder Committee's Report. It seems to us to be based on over-optimistic assumptions; it is enormously expensive and seemingly alternative proposals have not been properly considered.
3.31 p.m.
Baroness SEEAR: My Lords, we on these Benches are fully aware of the importance to the export trade of the car industry in general and of British Leyland in particular. We are also as aware as any section of your Lordships' House of the grievous consequences of unemployment which would have arisen if Government action had not been taken at this stage in order to assist this great company in its difficulties. I say this and I underline it because with full recognition of the nature and gravity of the problems we remain very critical indeed of the solution that the Government have arrived at.
The Government are relying in their policy—in their extremely costly policy—on the Ryder report, and what I have to say about that report I say with no wish to carp at what was no doubt a very gallant effort on the part of Sir Don Ryder and his collaborators to produce a report about a very complicated, very confused and very important issue. The fact remains that that inquiry was set up on the 18th December 1974, and the report was handed to the Government on the 24th March 1975. Any of us who in however humble a way have taken part in investigations of matters far less complex and far less important would doubt whether a competent job can really be done in 14 weeks, which includes Christmas and printing and handing it in to the Government. I doubt very much whether any professional consultant, whose career and reputation depend on it, would have contemplated doing a job of these dimensions and making recommendations involving expenditure on this scale in a period of less than 14 weeks. It can mean that only some aspects of the problems were adequately explored and some questions investigated in relative degrees of depth and detail.
As we all know, in an inquiry of this kind the results one gets depend on the questions one asks and the questions asked depend on the hypotheses with which one starts. This must underline some doubt about the validity of the Ryder report as a basis for so vast an expenditure of taxpayers' money; for vast it undoubtedly is. The noble Lord, Lord Aberdare, has already given the figures and I will not repeat them. But when we look at figures of these dimensions, even the Government's plainly

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optimistic hope as to what is to be financed out of profits—and it must be regarded as optimistic—and taking the most hopeful view of the forecast, the amount of taxpayers' money going into this venture is immense.
Let us look at it from the point of view of chapter one of the simplest book on economics. What other things could have been bought with that money, what other things could be done and what will not be done because this money is going into British Leyland? There are other industrial competitors, not in the motor industry but in other industries, who might well have given a better return on that money than the return that can be given on it by British Leyland. There are other causes—causes in the field of social welfare and education—that might have used the money to better effect than it will be used inside British Leyland. Even if we accept—as, of course, we do—that some money had to go, and go quickly, into British Leyland, was it necessary to commit so vast a sum so quickly? A capital base could have been secured and then a far more detailed and thorough investigation done into the real needs and prospects of the different elements that go to make up British Leyland and what they could produce. It is reasonable to suggest that certain parts of that business need to be supported, but that other parts might indeed have to be sacrificed; that a smaller and more efficient business with some contraction in some areas and expansion in the more profitable areas might have been a better and much cheaper alternative. But we do not see this kind of option discussed in any detail inside the Ryder Report, nor has the noble Lord, Lord Beswick, discussed alternatives of this kind with us today.
It was not an all or nothing challenge. It could have been the maintenance of British Leyland in part rather than in whole. This was argued with considerable force in another place and it is disappointing that no reference has been made to the possibility of maintaining sections of British Leyland rather than finding it necessary to support the whole, and in that way getting a far better return on a smaller amount of money and leaving some of that money for other equally deserving causes.
Indeed it is admitted that there is considerable overmanning in British Leyland.
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A better plan might have been to look in detail at the shortages which still exist for skilled men in other industries and other trades, and to put some of that money into a redeployment of the excess labour in British Leyland, moving them into skilled jobs through well-financed training, supporting their standard of living. In these jobs they will make a better contribution to the economy of the country and, indeed, in the long run a better contribution to their own well-being. But such options are nowhere discussed.
Then we have to ask what quid pro quo are we to get for the support for British Leyland in terms of improved productivity and in terms of improved industrial relations. We know that there have been shortcomings which, of course, are due to a variety of factors. I do not wish to go into them at the present time, but the figures are hair-raising and no one in your Lordships' House will deny that there is (to put it mildly) ample room for improvement. It is not unreasonable. It is a well established tradition in many parts of the private sector that there should be, in exchange for new advantages and new benefits, some kind of productivity agreement and that there will be definite improvements and changes.
The noble Lord, Lord Beswick, has said that certain tranches of the money that are to be paid into the industry are going to be dependent on improvements. As the noble Lord, Lord Aberdare, has already said, it is not only right but essential that we should know under what conditions those tranches are to be forthcoming, and that we should be given an undertaking that, if the conditions laid down are not met, additional money paid by the taxpayer does not go into British Leyland. Interested as your Lordships' House is surely allowed to be interested, even in a Money Bill, in what happens to taxpayers' money, this is the least that we can reasonably ask.
The noble Lord, Lord Beswick, said—and here again, noble Lords from all sides of the House would agree—that it is vital there should be greater collaboration between management and employee representatives in British Leyland as, indeed, throughout British industry. May we, for one moment, consider some of

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the implications of that improved collaboration. One of the great benefits of improved collaboration between employer and employed is that employee representatives, because they take a part in the making of decisions vital to the interests of the industry, sometimes for the first time, are faced with the real facts and the real problems that confront management day in, day out. I accept that it is a weakness of management that these facts and problems have not been sufficiently and adequately communicated to the labour force inside the place of work. Collaboration is not only beneficial because it gives the employee an opportunity to have a say in the running of the business but it also gives the employee the experience of facing responsible choices in very different situations.
But if there is the belief, at the end of the day, that whatever choices are made, the Government will bail out the company because Government money is always there, then this major benefit from collaboration is lost. Whenever a discussion is entered into, whenever awkward unpopular choices have to be faced by the employee representatives because these are the facts of the situation, if at the back of their minds there is the knowledge that come what may, however facile or short-sighted the decision they make, the Government will always help them out, this major benefit of collaboration is destroyed before the experiment even starts.
In this context, I implore the Government to remember that collaboration is collaboration between employee representatives and management, and increasingly it is between skilled and professional management. One must hope that the Government and their representatives inside British Leyland, in the reconstruction that they are making, are looking for the best calibre of professional management they can get. That professional management, when we have it, must be allowed to manage. In encouraging collaboration and industrial democracy—and we on these Benches are second to none in our support of this—we must make sure that we get good collaboration, with proper support for the role of professional management.
Too often when these matters are discussed, it is forgotten that the role of professional
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management is one of the most socially important roles in the country at the moment. Indeed, when one thinks about the contribution expected from a professional manager, and the contribution that professional managers, given their head, are able to make, one wonders very much at the role to be played by the Department of Industry and NEB in judging the competence of the performance of British Leyland or, indeed, any other enterprise. A weakness which worries many of us is that the people who are to do the judging, the people whose advice is to be relied on, are those far less skilled, far less well-trained, and far less professional than the people whom they are judging.
3.49 p.m.
Lord BRUCE of DONINGTON: My Lords, before I came to the Chamber this afternoon I was a little uncertain of the attitude that would be taken by the noble Lord, Lord Aberdare, with regard to this Bill. I gathered towards the conclusion of his remarks that he was far from happy. I think he was being a little modest. As I judge the position from listening to his speech, he was thoroughly unhappy, being outdone in this only by the noble Baroness, Lady Seear, who seemed to be thoroughly miserable.
My Lords, the Bill before us this afternoon presents the opportunity to this country, to its industrialists, management and workers, of making a constructive contribution to the re-establishment of what is almost universally agreed to be one of the most important industrial units of this country, employing some 170,000 people, with subsidiary employment in all the ancillary trades and other businesses dependent on it, possibly to the extent of another half a million people. So we are discussing something of importance. After all this time, I would think that the members of the Opposition and noble Lords on the Liberal Benches could have found it in their hearts to give an enthusiastic boost to what, in any event, will be the great task facing all those likely to be involved in it—but we have had nothing of the kind. It is quite clear that those who debated this matter from the Benches opposite had not examined the Ryder report in detail, because if they had, they would have realised the enormity of the defects that had

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accumulated in that company, particularly over the last eight years.
I have before me the annual report and accounts of British Leyland for the year 1974. I want to quote the first sentence only from the directors' report, which says:
"At the beginning of the financial year"—
that was 1st October 1973—
"the Corporation was in the strongest position both financially and organisationally since its formation in 1968."
The Ryder report proves conclusively and in detail—and I am willing to be challenged on any paragraph in it—that this was not so, and that far from being in "the strongest position both financially and organisationally since its formation", it was in a most disastrous position, organisationally and otherwise.
I turn first to the question of organisation. I wish to draw the attention of your Lordships to the old organisation as revealed in Chart No. 12.1 on page 52 of the Ryder report. I invite the detailed attention of your Lordships to this because it shows just how one important company in British industry was in fact organised at the time that Sir Don Ryder examined it. This is completely illustrative of the type of organisation in force over quite a wide segment of companies in this country, though happily, not in all. On examining the organisational chart, we find that the managing director, Mr. J. N. R. Barber, had no less than 14 executives responsible directly to him—I repeat, 14. In addition, he had responsibilities for what are technically termed "lateral consultations" with a further seven people; in other words, the managing director had to maintain contact with some 21 executives on a more or less continuous basis. Any second-year student at the Institute of Management would be able immediately to detect this incredible defect, because it is axiomatic within modern standards of management established over the last 25 years, that the maximum number of senior executives for which any director can accept direct responsibility is seven.
This is the form that has been reproduced in the new proposed reorganisation that Sir Don Ryder has suggested. If noble Lords will look at Charts 12.3, 12.4, 12.5, 12.6 and 12.7, they will find
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that like most sensible managers—and we should be greatly indebted to Sir Don Ryden—he has followed that rule of 7. This is chaotic management: 14 senior people responsible to one man, with seven for lateral consultation. It does not lie in any noble Lord's mouth, either on this side of the House or the other, to blame the unfortunate managing director, Mr. Barber, for this. I doubt whether he liked it very much. It was his board of directors who were responsible.
One thing that one notes on an examination of the Ryder report—and Sir Don Ryder has been very kind—is that the board of directors have not been mentioned anywhere; they are nowhere mentioned in the report. Noble Lords in this House are told many times, and the country is told, that British industry has some of the finest captains of industry in control; that these are the people with the enterprise, initiative, drive and enthusiasm that lie at the root of our industrial power. Sir Don Ryder does not mention them, for a very good reason—because it was they who were responsible in the final analysis for this organisational state of affairs. I have the list of them here.
I am not going to weary the House by identifying the directors of British Leyland, these captains of industry, except to say that there were 13 of them and that on average they drew per annum £26,000 each, which is a fair way, probably after rises, out of the Social Contract. Suffice it to say that the board contained individuals representative of some very strong institutions. There was a representative from the National Westminster Bank; there was a representative on the board from the Midland Bank; there was a representative from the Slater Walker Investment Trust and there was a representative from a firm of stockbrokers. A number of them, of course, were not full-time directors. At least one of them had 17 company directorships completely outside the British Leyland group, and another one had 17. The final responsibility for the organisational state of affairs was on these individuals. And yet when I listened to the noble Baroness, Lady Seear, I gathered that she had some concept of hiving-off certain parts of it, or devoting money to one part and not to another part. It should be clear to her, as it

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should be clear to your Lordships, that the organisational structure was thoroughly unsound from top to bottom.
When we come to the physical side of the operation, we find reference to the age of its plant. Paragraph 28 of the Ryder report says this:
"The most serious feature of BL's production facilities is, however, that a large proportion of the plant and machinery is old, outdated and inefficient."
If one turns to page 20 of the report, one discovers the full extent of this. One finds that over two-thirds of its plant, in cost terms, was acquired prior to the year 1969; that almost a quarter of it dates back to 1957 and even far back beyond that. In other words, the plant and machinery of British Leyland has been allowed to run down.
This is not a new phenomenon in British industry. Indeed your Lordships will recall, if you will forgive me the indulgence, some remarks I had the honour of addressing to you on the same general subject approximately a week ago. This has happened in the whole of British industry. There has been this considerable underinvestment. When the noble Lord, Lord Aberdare, wrung his hands and said that at inflated prices he did not like to put his finger on a definite figure but we wanted another £2,000 million for fixed capital investment and another £750 million for working capital, he really at the same time posed to the House the same kind of problem that will come before it when we have the opportunity of discussing and debating the Industry Bill when it comes from another place. The fact of the matter is that the unit costs in British Leyland were too high precisely because the ratio of the labour costs to machinery used were also far too high. And this needed a surgical operation. It needed a massive injection of investment capital into plant and machinery. The Government are the only body at this time capable of making the massive injection required.
What else were the board of directors responsible for, this board that is not referred to by Sir Don Ryder? It ensured that out of the £74 million profits after tax made in the last seven years no less than £70 million was paid out in dividends, leaving only £4 million in retained
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profits out of which to make further investment in fixed plant and machinery. These are the people who are supposed to be capable of conducting the country's industry. These are the people whose virtues are daily extolled by the Press, in which they advertise; by the Press which is controlled in the main by the Party interest that sustains their cause.
Sir Don Ryder came to the conclusion, a very sensible conclusion, that the only way to deal with a situation of this kind was reorganisation, a very drastic reorganisation, and an injection of capital. The noble Baroness, Lady Seear, said that 14 weeks was a short time in which to produce a report of this kind, I agree. It indeed is a mammoth task to accomplish in such a very short time, and reflects very great credit upon Sir Don Ryder and those who assisted him. But I implore the noble Baroness to realise that the reason why it took such a short time was because the problem was so radically simple; there was nothing complicated about it at all. As I have said, a second year student at a British college of management could almost have produced a report of this kind on the basis of the published figures. It is precisely because the errors were so glaring and so precise that he was able to produce a report within this period of time. Noble Lords opposite, the noble Lord, Lord Aberdare, and the noble Baroness, Lady Seear, said: "Well, why do not the Government come out with alternatives? Why did not Sir Don Ryder himself suggest some alternatives?" The implication behind this is that there is a great variety of solutions to a problem of this kind.
I implore your Lordships to believe that there are no several and alternative solutions other than those imposed by the existence of the time scale and the availability of resources. The organisational task to be accomplished is quite clear and has to be done, in any event, in conformity with the known and accepted rules of management. The financial deficiency, in terms of the money required for investment in plant and machinery, is simple enough. It does not need a don from Oxford University or investment analysts from the City of London to determine what is required physically in the company. To that extent, I will agree with the noble Baroness and the noble Lord, Lord Aberdare.

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The success of this enterprise, after there has been this capital investment and this restructuring, urgently requires the fullest collaboration on the part of all the operatives. The plea that should go out from this House is one for responsibility within the organisation as a whole; a real sense of responsibility among the 170,000 operatives within it. Even though society owes it to all of its citizens to see that they are protected from the consequences of adversity and sickness, every one of us also has his own responsibility to society, and the workers in British Leyland, at whatever level they operate, however low or high, also have this vital responsibility. I hope that your Lordships, by your decision this afternoon and during later stages of this Bill, will give your vote of confidence to all those working in British Leyland, at whatever level, for the future success of what we all hope will be a great and magnificent enterprise.
4.3 p.m.
Lord LUCAS of CHILWORTH: My Lords, I am sorry that the noble Lord, Lord Bruce of Donington, has treated us to such a long historical survey of the events leading up to the rather disastrous position in which British Leyland found themselves 18 months ago. The noble Lord accused my noble friend Lord Aberdare of being miserable in his speech. It may be that my noble friend saw a rather hard and miserable path in front of British Leyland, the Government and everyone else concerned. But at least he did not make the mistake of looking so far back that he tripped over that which was in front of him. I am grateful to my noble friend for that. I can see no point in looking back. Indeed, casting one's mind across the automobile industries of the world—and the noble Lord, Lord Beswick, made mention of this fact—nearly every major manufacturer has, through a variety of circumstances, found itself in some kind of difficulty over these last few years.
It is a fact that, proportionate to its size, British Leyland's difficulties, if measured in terms of pounds and pence, are a good deal smaller than those of other major worldwide manufacturers. I do not think that whatever Ryder may have said in his report in condemnation of the management, the structure and organisation of British Leyland is tremendously material to the problem in
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front of that company. Nobody wanted to see British Leyland in the difficulties in which they found themselves; and nobody, least of all my noble friends on this side of the House, wanted to see British Leyland go to the wall. This would not be at all in the best interest of the nation. That the present Government found themselves in the position of having to receive the call for aid is, in some respects, fortuitous. It would be quite wrong, in my view, to put any political connotation on the method by which the present Government decided to give the aid. Quite necessary and immediate cash was due without any delay at all.
My Lords, the Ryder report, very shortly brought out, leaves many of us with areas of disquiet. Perhaps at this stage it might be proper for me to remind your Lordships of my interest in the industry—not in manufacturing but more in retailing. There are certainly those on the retail side of the industry who are perhaps not entirely happy about some aspects of this report. Nevertheless, Ryder attempts to set out part of a plan. That the Government have accepted the entire report is perhaps mistaken, but there is time to modify that report. I would regard it not as a blueprint for British Leyland, but as part of, and only part of, a very long-term plan in which they say that certain things could happen. I am sorry that the noble Lord, Lord Bruce of Donington, has left his seat, because I wanted to take up a point he made.
Lord DAVIES of LEEK: My Lords, he has whispered his excuse. The EEC Committee of which he is a member is meeting, and he makes his apologies for his absence so soon after his speech. I thought that the noble Lord would like to know that it was not discourtesy.
Lord LUCAS of CHILWORTH: My Lords, I am quite sure the noble Lord, Lord Bruce of Donington, would not be discourteous. I hope that his noble friend Lord Davies of Leek will draw his attention to Hansard tomorrow. The noble Lord, Lord Bruce of Donington, said that Ryder suggested a rearrangement of the company. He said in comment to the noble Baroness. Lady Seear, something about the company divesting itself of certain of the profitable parts or divisions.

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I was going to accuse the noble Lord, Lord Bruce of Donington, of trying to keep the same old pudding which the Ryder report commends and trying to put it in different bowls hoping it will come out a different shape. That it will not do. One can appreciate any Government, looking at a complex organisation like British Leyland which is manufacturing so many different kinds of things, not wishing to be accused of hiving off particular aspects to this body and that body, to private enterprise or somebody else. I suppose that that would be almost political suicide in this context. Nevetheless, if British Leyland are to be the most forceful of the United Kingdom-based motor companies, some of their activities must go. They will have to recognise where their forte is and concentrate their energies, efforts, expertise and the money available to them in that direction.
I come from nearly 30 years in the retail motor industry. I feel that it is right to remind your Lordships that the retail industry has invested, man for man and pound for pound, just as much as have the manufacturers. Without a viable retail network—and I am not talking only about the United Kingdom but also about overseas retail dealers—and without the support of the dealers over the last eight years, British Leyland would not have got as far as it has. It has proved to be the biggest exporter of goods from this country and the biggest profit earner of those exported goods, so that condemning the company's achievements is not helpful.
When the noble Lord, Lord Beswick, speaks about the amounts of money which will be allowed to British Leyland against some measurement of performance over the years, let him please consider the retail industry throughout the world which is to put up the cash for the goods and to do so in advance—because dealers lay their cheques with order, they do not pay on the nail as is done in many other businesses. Will they be happy to do so when they know that, at some indeterminate time and for some undetermined reason Government support could be withdrawn and the company could cease to exist? I do not believe that the Ryder report or—though I speak with the greatest deference—the Minister have
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paid sufficient regard to the people who are handling the end product. Retail dealers throughout the world are quite happy to handle a good product which comes from a good manufacturer when they know that the supply source is stable.
I should not like Her Majesty's Government or my noble friends to be too much swayed by the recent talk about limiting the imports of foreign motor cars. That would not be helpful to our own domestically-based trade. I do not speak of anti-dumping but of the normal manufacturing retail competitive entry of other makes of motor car. The world wide network and our own network of retail dealing are based on certain marketing factors. If one were to deny the import of foreign cars even for a short time or for particular reasons, the balance of retail marketing in this country would be severely upset, and that could be only to the detriment of the United Kingdom-based manufacturers, including British Leyland. They need stability of labour relations, of raw material supplies, of dealer support and of sales of their goods in the United Kingdom and worldwide. Without that they cannot succeed at all.
My Lords, one may pour many millions of pounds into a business, but nothing will be achieved without effective management. From this side of the House, there has been mild criticism of the management of the company. Time alone will tell whether the existing management structure and its hopes of worker participation will do better. However, one American motor car manufacturer told me a short while ago that, given continuity of production he could produce all the cars he needed for his share of the world market and make a decent return on the capital employed by working eight months of the year. However, that meant working every hour, every day of every week of those eight months. Then the other four months could go hang.
Stopping and starting a production line, as I know to my cost from my experience of one 30 years ago, destroys efficiency and the reliability of the product. Also, in those days, it hit everybody's pocket, because profits were based on keeping the line moving. The Bill provides financial limits. It would, in my view, be quite wrong for us to criticise how far that should go at this time. One would like to

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see, over the course of the next 12 months, a far more wide-ranging review of the company's affairs and needs, so that, in the event of vast sums of money being needed, there would be a greater opportunity of discussing what is to be done.
More should come out than the Ryder report was allowed to bring out. We can appreciate the reasons but, in the industry, we have had to make intelligent guesses about the omissions. In relation to the point made by my noble friend Lord Aberdare, we could then decide how, when and for what purpose to spend the taxpayers' money and the matter could be more fully debated. At a time when everybody is required to pull back and when public spending is being criticised, it is quite wrong that the British public and those people who are working in the industry should think that the purse is bottomless just because the Government are footing the bill.
4.18 p.m.
Baroness WARD of NORTH TYNESIDE: My Lords, I shall be very brief, but I want to ask for one small guarantee and to have a statement of fact recorded in Hansard First, let me say that I fully support the speech made by my noble friend Lord Aberdare. However, the sum of money involved in the British Leyland project is enormous and I want to ask the noble Lord, Lord Beswick, whether, when he comes to reply, he will give a guarantee that, with this tremendous amount of money which is being spent, my part of the country and others which may be in need of help will also receive assistance and that not all the money will go to British Leyland to the exclusion of the real needs of industries in other parts of the country. I should like to have that guarantee because I think it is very necessary.
My noble friend Lord Lucas of Chilworth said, rightly, that there was no point in going back. I agree, but I want one point recorded in Hansard for this House because there is one particular matter which needs to be remembered. I doubt very much whether many noble Lords who are here today will remember the beginning of the last war. On that occasion, an assessment was made—and I do not criticise it—that my part of the world and much of the East Coast would be the first part of the country to be
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bombed by Germany, as we were nearer than British Leyland and other parts of the country which subsequently suffered enormously.
When that assessment was made it was laid down that my part of the world, and the East Coast in general, was to have no new industry of any kind—or indeed anything else—because of the fear that if, in connection with the war effort, new industries were set up in my area, they, and possibly new houses and hospitals, might be bombed. Therefore by the time the war ended all the new industries had been set up in other places: in the Midlands, in the Birmingham area, which had the whole of the motor car industry, as well as the radio and television industry. A little further North the man made fibres industry had been set up. Meanwhile, we on the East Coast were left with no new industries at all.
In Northumberland and Durham we had probably the oldest coalfields in the country. Many of them, as the House will be aware, are now closed down. So there we were, at the end of the war, in the position I have described. But nobody in my part of the world complained about this. They realised why the Government's decision on industry had been made; they accepted it, and they had been prepared to work with everybody else in the country until the war was won. But in my area for many years we experienced a very high level of unemployment. We received a great deal of help—but we needed that help.
It is not always easy to persuade new industries to move up to my area. The South still regards those of us in the North as barbarians; of that I am well aware. I want to put these points on the record, because although my noble friend Lord Lucas of Chilworth, said, "Let's forget the past", I am afraid that I cannot forget that part of it in which my area had such a struggle to build up new industries and new employment—
Lord LUCAS of CHILWORTH: My Lords, I am sure that the noble Baroness will not mind my interrupting her for a moment, but I wish to point out that if she reads Hansard tomorrow she will see what I said. I said that I did not see the point in delving into the past in relation to the history of the management of British Leyland. My remarks about not

39
delving into the past were not intended in terms of employment and social events in the North-East.
Baroness WARD of NORTH TYNESIDE: My Lords, I am very grateful that my noble friend has explained that point. I am always listening for what is to be done for my part of the world. I had not realised that my noble friend had been referring to the management of British Leyland when he said that there was no point in discussing the past. I want to put that right. I want this matter put on the record, so that all noble Lords, of all Parties, will know how hard we suffered as a result of the action that had to be taken during the war. I appreciate that other places, like Coventry, Portsmouth and Southampton, were subject to bombing. Thank goodness the assessment regarding my area did not, on the whole, prove to be right!
I say to the noble Lord, Lord Beswick, that I hope that if huge sums of money are to be invested in British Leyland, not all the money to support new industries will go to British Leyland, with the result that there is none left for us. I wished merely to put my point on the record, my Lords, and I assure your Lordships that I shall do all I can to help in the present very difficult situation in British Leyland.
4.25 p.m.
Lord ROBBINS: My Lords, I wish to detain your Lordships for only three or four minutes. The speeches made so far in this debate have been made from the Party Benches, and I wish to add a note of personal disquiet about the Bill now before us. Your Lordships have listened to a very downright and outspoken condemnation of British Leyland's past by the noble Lord, Lord Bruce of Donington. It is not my intention to attempt to contravert those observations. Indeed, I suspect that although there may have been over-simplifications and exaggerations in the noble Lord's strictures, many of his observations will be found to be justified. I find it difficult to believe that a company of this type could have got into such extreme difficulties had there not been gross deficiencies of management, as well as great deficiencies which have been hinted at in previous speeches.
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I suspect, my Lords, that there may be something in the view which has from time to time been voiced previously, that British Leyland is, archetypally, one of those aggregations which should never have come into being on that scale. There is something to be said in favour of the view that some industries can be too large and that greater efficiency may be obtained by disaggregation. But that is not what I want to say. I think that disquiet about this Bill, quite apart from the disquiet about the past from which it springs, may reasonably be expressed on two counts. The first was mentioned by the noble Lord, Lord Aberdare, when he suggested that there is—I speak with hesitation in this matter—an appearance of undue precipitancy in rushing in at this moment with so ambitious a commitment.
It is surely arguable that while no reasonable person will question the need for emergency action in this respect to save the momentary situation, it might have been more prudent to have delayed these ambitious plans which involve the perpetuation of the same organisation—to pour the phrase used by the noble Lord, Lord Lucas of Chilworth, into a different mould—rather than pausing to consider whether some more drastic reorganisation and perhaps disaggregation may not have been in order.
My second reservation relates to the extent of the commitment. I must confess to your Lordships that to me any projection of prices and profitability reaching forward to the year 1981 is pure nonsense. I cannot believe that any expert could lay his hand on his heart and predict what prices and profitability will be in a year's time, let alone in another five years, when who knows what the effects will be of continuing inflation or whatever efforts are made to contain inflation. Any consideration of an aggregate figure of investment to be made over the next five years may be good shop window, but it certainly will not convince anybody who wishes to go into the matter in any detail.
I confess that I should have wished for more precise details concerning the nature of the reviews which are promised from time to time to ensure that the investment is worth while. Surely this at any

41
rate is a matter on which we could have been more fully informed. It is pie in the sky to predict future prices and profitability, but it is surely a matter of, if not the science of management as was suggested by the noble Lord, Lord Bruce of Donington, at any rate the art of it to devise modes of review which will satisfy reasonable people, whatever the prices and profitability may be. The absence of further detail on that matter at this stage when your Lordships, with their limited powers, are asked to give qualified assent to this most ambitious project, is something which I must regret.
4.32 p.m.
Lord THOMAS: My Lords I feel compelled to speak in this debate, because I spent 25 years helping to mould what has become a cornerstone of British Leyland. I wish that the noble Lord, Lord Bruce of Donington, had not kept referring to it as "a unit of industry" because British Leyland is not a unit; it is a fragmented complex and I believe that it wants far more drastic treatment than has been proposed in the Ryder report. I hope that before this report is implemented or accepted, it will be examined again because in my view it is far too optimistic, as the noble Lord, Lord Robbins, just said, in its premises and it is too lush in the amount of money that is projected.
As soon as the arrangements proposed by Lord Ryder were known in the Midlands, the bookings for overseas holidays by Midland workers escalated by leaps and bounds. It was not just a question of, "I'm all right Jack" but "Jane is all right too; we're going abroad and we'll have jobs for the rest of our lives." That is why I say that this very lush and expensive projection of money that will be poured into Longbridge, Preston and all the other places is a mistake and it should be cut back and modified.
I have another question to ask. Why perpetuate the name "Leyland" in such an important matter? Why make it the main brand name? Admittedly, for trucks, coaches, buses and so on it is fine, but there are several very good other brand names in the complex. One does not find General Motors in America calling themselves General Buicks or General Oldsmobiles. Let us emphasise the word "British" and forget the brand name
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"Leyland", a name which in many people's minds conjures up something heavy and bulky, although certainly well engineered. It is not the best way of projecting the automobiles from which the bulk of the business should come, so let us have another look at the Ryder report before it is wholly accepted. I have listened with great interest and admiration to the speeches of the noble Lord, Lord Aberdare, the noble Baroness, Lady Seear, and the noble Lord, Lord Bruce of Donington, although I wish he had not been quite so impassioned in the way he put his criticism of the past management.
4.35 p.m.
Lord HANKEY: My Lords, having spent years of my life trying to promote exports of British motor cars, I should like to say something about the difficulties which have to be solved if we are not to pour money down the drain. Frankly, the servicing facilities for British cars abroad are still inadequate. The spare parts arrangements are not very good either and we have not been able to maintain a good reputation; and I am afraid this goes for British Leyland, too. If we pour all this money into British Leyland—and I suppose we are going to do it—we will lose it unless a lot of these outside faults are corrected. Some of the faults lie outside the country.
I once went all the way from Stockholm to see Mr. Harriman, and I told him that they were going to lose their Swedish market unless they improved their servicing facilities. I suggested the British motor car companies should get together and form a servicing and spare parts organisation common to the whole lot. I said that they could slit each other's necks on styling, price, delivery dates and the rest, but when it came to servicing and spare parts they should stand together and then they would have the Germans beaten. Mr. Harriman replied, "I can see you don't know much about the British motor industry. That is quite out of the question." I replied, "If it is out of the question, you will be hard pressed to keep your share of the motor car market abroad," and if it had not been for EFTA that is what would have happened.
One of the difficulties about selling British motor cars abroad on the scale which is necessary to make this enormous

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investment profitable is that they are not properly treated in British ports. I have Dutch friends who like buying British cars, but they complain that when our vehicles arrive they are short of wheels or tyres and sometimes the headlights or generators are taken, and while I know that these items are covered by insurance, the nuisance—
Lord BESWICK: My Lords, may I interrupt the noble Lord to call his attention to the fact that this is a Money Bill which has a narrow application and has absolutely nothing to do with the treatment of cars at British ports?
Lord HANKEY: Nevertheless, my Lords, we will lose this enormous sum of money unless we put this matter right. If we allow thieving to go on in our ports on the present scale, the money with which this Money Bill deals will be wasted.
It is obviously very desirable that the workers should be represented on management but the legislation which the present Government have forced your Lordships to pass is really of such a nature that nobody has any control over the work force any more. It is impossible for management to manage. Anybody can go on strike for just about anything. It is not a matter of whom one has as the liaison man in the boardroom or with management; he will not be able to control the workers because your Lordships have passed two Acts which make it possible for anybody to go on strike on any excuse, and in these circumstances it is impossible to run a large integrated modern industry which requires close cooperation.
I was very interested in what the noble Lord, Lord Lucas of Chilworth, said about the American motor car manufacturer who commented that if he could keep everything working constantly for eight months he could make the grade in any year. I am sure that the same applies to British Leyland, but they are so bewitched and bewildered by strikes which put various parts of the organisation out of kilter one after another, that they find it very hard to get on with the proper job of management. Having seen the situation abroad, I know that the disability of the British motor industry—and this
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applies not only to British Leyland—in regard to delivering their goods on time is a source of utter despair to their agents abroad. This has happened constantly over the years and it has steadily become worse. I have no doubt that if we do not correct this state of affairs in our factories in some way or other, we shall lose this enormous sum of money.
I am shocked at the way our affairs have been handled. The shares were each worth a number of pounds not so long ago. There have been restrictions on dividends and prices. The shares have gone down steadily in price, largely due to Government action. The Government are now going to buy them up at 10p a share. It is rather like a director gambling in the shares of his own company. It throws a sombre light on the way our affairs are now conducted. My Lords, we are obviously going to pass this Bill; we have to make this money available. I want the Government to make sure that it is not going down the drain. If the affairs of this industry and others continue to be treated in the way they have been treated in the past few years, we shall lose this and a great deal more besides.
4.41 p.m.
Lord BESWICK: My Lords, I am grateful for the approach made by the noble Lord, Lord Aberdare, to this Bill, and although it is a Money Bill I am sure I will be expected to reply to some of the points which have been made. I was particularly glad that the noble Lord, Lord Aberdare, did not press the possibility of a solution on the lines of the Rolls-Royce situation. A receivership there was bad enough. In the case of British Leyland, with its consumer image to consider, it would have been absolutely fatal. The noble Lord appeared to be a little dismayed at the sums of money involved by the solution put forward by the Ryder report which the Government have accepted.
I sympathise with what was said by the noble Baroness, Lady Seear, the noble Lord, Lord Robbins, and others, when one considers how large the sums of money are. Nevertheless, we have to relate them to the task in front of us. It is the considered view that moneys of this order are required if the company is to have the equipment that is needed over

45
a period of years. Perhaps the noble Lord, Lord Robbins, and others, view this large figure thinking it is to be spent this year and next, but of course it is not. It is to be spread over a number of years; moreover, it is to be raised in different ways: some from the cash-flow of the company and some from the Government. Maybe it is just possible that the pessimism of the noble Lord, Lord Robbins, as to this is not entirely justified. It has been suggested by a number of noble Lords, and by the noble Baroness, Lady Seear, that not enough attention has been given to the alternatives. The alternatives were set out fairly clearly in paragraph 12 of the report, and they were considered by the Ryder team. Obviously some of the possibilities had to be taken into account, but if one dismisses some of those possibilities on grounds of principle I do not think it would have been justified to go into long and detailed financial study of each of the alternatives which has been given to the solution which the Ryder report has put forward.
The noble Lord, Lord Lucas of Chilworth, said it would be possible to hive off certain activities—and he was tantalising when he suggested what he had in mind. Clearly there can be no question of hiving off divisions such as Jaguar. Hiving off Austin Motors scarcely justifies the term "hiving off". Maybe what the noble Lord was thinking about was the paragraph where Ryder says that once the new organisation is set up, once there are the four new profit centres, certain matters have to be looked at very carefully, indeed. The noble Lord, Lord Lucas of Chilworth, reminded us—and we do not need reminding—of the great experience he has had on the distribution side of this industry. The association with which he is connected gave evidence to the Ryder team. Much of that evidence has been treated as confidential, but it was considered.
There was a certain amount of criticism that the estimates of the Ryder team about the future market of the motor car industry were a little optimistic. The noble Lord, Lord Thomas, was talking about them as being lush, but I am not certain that it can be said that they are over-optimistic when, after all, it is suggested that by 1980 we may get back to the position reached in 1973. One can
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juggle with figures, and the noble Lord, Lord Aberdare, was skilful in this when he said they were anticipating a 62 per cent. increase of business in the EEC; but one can put that another way and say that what, in fact, is intended is to secure another 1 per cent. of the market in 10 years' time; that is to say 4 per cent. in 10 years' time as against 3 per cent. at the present time.
Lord ROBBINS: My Lords, may I interrupt the noble Lord for a moment? He alluded to my observations as pessimistic. If he substitutes the word "agnostic" he would be nearer the mark.
Lord BESWICK: My Lords, I am prepared to accept many suggestions from the noble Lord, Lord Robbins, and I am happy to accept that one. One has to look at this with caution. At the present moment I do not think that there is any direction in which we can turn where we are justified in being ebullient. One has to be cautious. I put it to the noble Lord, Lord Robbins, and to the noble Baroness, Lady Seear, that if you come to the conclusion that you are not going to invest money in this type of project, then where are you going to invest your money? The noble Baroness made certain suggestions: that we can get a better return by putting it in the social services. But we are not going to be able to invest any money in the social services unless we have effective exporting companies in this country. Over and over again I hear criticisms made of money going into the aircraft industry and the motor car industry, and why should we not invest it anywhere else. These proposals can be put up and they can be shot down equally as easily as one can this imaginative investment proposition for motor car industry.
It was said by a number of noble Lords that we must not give the impression that, no matter what happens in this company in the future, they will be baled out. If that impression is given, it is a false one. None of us on either side of the House should help to further that impression. I do not accept what the noble Lord, Lord Thomas, said, that because a person is going to take a holiday this year this means he thinks he is going to be baled out come what may in the motor car industry. If he was in his place I would say to the noble Lord that that was an absurd proposal to put forward.

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My Lords, let us look at this fairly and in the round. I have criticised some of the actions of the work force in this industry and elsewhere. The Ryder report states clearly that they do not subscribe to the view that all the ills of the company can be laid at the door of strike-prone and workshy labour force. They were handicaped with out of date plant and equipment and that is to be replaced. There was one additional interesting point made by the noble Lord, Lord Robbins, when he advocated quite precisely the propositions now put forward that, "small is probably beautiful" and that, "big is not necessarily better". I think there is a good deal in that. Nevertheless, when one looks at the competition this company has to face, I do not think they are going to be over-big in relation to their competitors. Moreover, one of the aspects of the reorganisation put forward by the Ryder team is that there should now be what they call these four new businesses or profit centres, allowing for a good deal of delegation and getting some of the benefits of disaggregation, which the noble Lord, Lord Robbins, suggested could be helpful.
I was asked for an assurance by the noble Baroness, Lady Ward, that not all the money available under various schemes under the Industry Act would go here instead of to her beloved North-East. I am glad to be able to give her that assurance. That will not be the situation at all, but I would tell the noble Baroness that there are companies in her North-East which depend upon a successful British motor car industry. Therefore, I hope that we shall be helping the North-East as well, even though the money may not be operating directly there. There was one other point which I think I should correct. The noble Lord, Lord Aberdare, mentioned that the Ryder Report had assumed a 15 per cent. inflation rate for this year. That is not quite true. What in fact they assumed was a rate of 22½ per cent. from September 1974 to September 1975, and a rate of 15 per cent. from September 1975 to September 1976.
I should like to end by agreeing again with the noble Lord, Lord Robbins, that in the present situation to look ahead for five or ten years and try to make
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precise calculations is a misuse of human effort. On the other hand, one has to make certain assumptions. One has to do something. To say that times are difficult and inflation formidable so that we cannot make estimates, and then just sit back, can be a formula for complete disaster. I think what is proposed here is constructive. The money will have to be spent carefully and those who operate equipment will have to recognise their responsibilities.
There will also need to be a careful monitoring of results. In this connection, I should like to say that I do not think it is as difficult as some people assumed to monitor each year how each company is doing. The noble Lord, Lord Robbins, knows better than to suggest it is impossible to do this. Of course, the annual report will go to the NEB, and the Prime Minister has indicated that those reports, together with any comments made by the NEB on them, will be made available to Parliament. I hope that that will answer the very reasonable request made by the noble Baroness, Lady Seear. With those explanations, my Lords, I hope that we can now give a Second Reading to this Bill.
On Question, Bill read 2a; Committee negatived.

SOCIAL SECURITY BENEFITS UP-RATING ORDER 1975
4.54 p.m.
Lord WELLS-PESTELL Lord WELLS-PESTELL rose to move, That the Draft Social Security Benefits Up-rating Order 1975, laid before the House on 11th June, be approved. The noble Lord said: My Lords, it might be for the convenience of the House if we discuss with this Order the draft Supplementary Benefits (Determination of Requirements) (No. 2) Regulations 1975, which were also laid before your Lordships on 11th June. The two Instruments together provide for most of the increases in benefits announced by my right honourable friend the Secretary of State in her Statement in another place on 22nd May. I will deal first with the national insurance and industrial injuries benefits which are covered by the Order and then turn to the supplementary benefit increases provided by the Regulations.
It will be, as your Lordships will recall, the third uprating since the Government entered Office and will be implemented from the week beginning 17th November, just over seven months after the last increases. Your Lordships will be aware that this is the first occasion on which national insurance and industrial injuries benefits have been increased by means of an Order. In the past, an uprating Act has been necessary—on 14 occasions since 1948. In adopting this new method, however, we are following the previous Administration, who provided for upratings by Order in their 1973 Social Security Act—a method of which we approve. In this uprating, long-term benefits are again being increased by more than short-term benefits. This reflects the statutory obligation on the Government to increase pensions and other long-term benefits in line with the movement in the general level of earnings, unless the movement in the general level of prices would be more advantageous to those concerned. For short-term benefits, on the other hand, the criterion is the movement in the general level of prices.
I will not go into detail but, as your Lordships will recall, the interval between the April and the proposed November upratings is, as I have said, just over seven months, so that the movements of prices and earnings were measured over a seven-month period, starting from August 1974—the point where the calculation of the last uprating ended. Thus the period of measurement was the seven months up to March 1975. Later information is now available, but changes in earnings and prices after March 1975 will be reflected in the next uprating. In the relevant seven months' period, to which I have referred, earnings rose by nearly 15 per cent. and prices by just over 13 per cent. Pensions and other longterm benefits are therefore being increased according to the movement in earnings, whereas short-term benefits will go up in line with the movement in prices.
I do not propose enumerating all the various increases: a list is to be found in Appendix 1 to the Government Actuary's Report (Cmnd. 6083) which accompanies the Order. It might help your Lordships if I refer just to the standard rates of retirement pension, which will be increased from £11·60 to
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£13·30 for a single person and from £18·50 to £21·20 for a married couple, and to the standard rates of sickness and unemployment benefits which will go up from £9·80 to £11·10 for a single person, and from £15·90 to £18 for a married couple. Other benefits will rise by corresponding amounts. No increase is proposed on this occasion in maternity grant, death grant or age addition, which my right honourable friend the Secretary of State is not obliged to review under Section 125 of the Social Security Act 1975. If I may refer briefly to the structure of the Order, Article 1 is formal. The increased rates are provided for by Article 2, together with the schedule, and Article 3 provides for the dates from which the various increases in benefit are to take effect—generally, the appropriate day in the week beginning 17th November on which a particular benefit is normally paid.
My Lords, I will turn now to the Supplementary Benefit Regulations. These Regulations provide for increases in the main supplementary benefit scale rates laid down by the Supplementary Benefit Act 1966. The scale rates, together with an addition for rent, represent the levels to which the income of the retired and others not in full-time work can be brought up. The main supplementary benefit increases are provided for by Regulation 2. It is proposed that the long-term rates, which are payable to supplementary pensioners and to people (except the unemployed) who have received a supplementary allowance continuously for two years, shall be increased by £1·70 to £13·70 for a person living alone and by £2·70 to £21·55 for a married couple. The ordinary scale rates, which apply to the unemployed and to other people who have received a supplementary allowance for less than two years, are to be increased by £1·30 to £10·90 for a person living alone, and by £2·10 to £17·75 for a married couple.
The preferential margin for blind persons will be maintained by means of the same cash increases in their scale rates as are being made to sighted persons. Increases in the amounts allowed for attendance requirements in the supplementary benefits scheme are also provided for in Regulation 2. They apply to supplementary beneficiaries who are also in receipt of the attendance allowance under the national insurance scheme.

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The increases in the attendance requirements are the same as those being made in the attendance allowance itself, with the higher rate becoming £10·60 and the lower rate £7·10. A standard weekly addition for rent is given to a beneficiary who is not a householder, and it is proposed that this shall be increased by 5p to £1 a week; this reflects (to the nearest 5p) the increase in housing costs between August 1974 and March 1975. This increase, together with the increase in his scale rate, will give the non-householder an increase of £1·40 if he is on the long-term scale, or £1·10 if he is not.
The Supplementary Benefits Commission have decided to increase extra heating additions from 40p, 80p and £1·20 to 55p, £1·10 and £1·65, respectively, a week. The standard additions for special diets are also to be increased, from 50p and £1·12 to 60p and £1·35, respectively. Both these sets of increases, which are not in the Regulations because they are made under the Commission's discretionary powers, will take effect from the same date as the main uprating; that is, from 17th November. Your Lordships will be aware that increases in the amounts which may be disregarded in calculating a claimant's resources were provided for in the Social Security Benefits Act 1975. These increases will come into effect at the same time as the new scale rates: and so, I should remind your Lordships, will the new non-contributory invalidity pension. I should emphasise that the increases in the main rates provided for in the Regulations are the same as the increases in the national insurance long-term and short-term benefit rates which are provided for in the up-rating Order. It is an integral part of our strategy to combat poverty that supplementary benefit claimants in particular, who are by definition among the poorest in the community, should be protected from the worst effects of inflation.
About 12 million people will benefit from the increases proposed in the draft Order and the draft Regulations and from the associated changes in war pensions which will be effected, to come into operation simultaneously, by means of Instruments under the Royal Prerogative. The annual cost of the proposals before
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your Lordships' House today is about £1,015 million. There will at the same time be an additional cost of £32 million for war pensions and of a figure in the region of £11 million for the increases in supplementary benefit discretionary additions. Of the total cost, £908 million a year will fall upon the National Insurance Fund. This will be taken into account in the review of contributions for 1976–77 which will be undertaken later this year. My Lords, our prime objective remains to control inflation. Meanwhile, so far as they are able, the Government are determined to protect from the effects of inflation the pensioners of this country and others who depend for their existence on social security benefits. These Instruments are a vital part of that continuing protection. I feel confident that your Lordships will accept these orders, and, my Lords, I beg to move.
Moved, That the Draft Social Security Benefits Up-rating Order 1975, laid before the House on 11th June, be approved.—( Lord Wells-Pestell.)
5.7 p.m.
Lord ABERDARE: My Lords, I am sure that your Lordships will be grateful to the noble Lord, Lord Wells-Pestell, for having introduced this Order briefly and clearly. We are in the middle of debating the Social Security Pensions Bill, to whose Committee stage we return on Thursday, so I do not wish to make more than a very few remarks about this up-rating Order. First, I note with interest that it is the first occasion on which such up-ratings have been introduced by Order rather than by legislation. As the noble Lord rightly says, provision for this was in our 1973 Social Security Act. I am sure that this is a more convenient way of doing things, especially when up-ratings have to occur at such frequent intervals. Probably those who represent specific interests and wish to see certain benefit payments increased will find it somewhat of a restriction on their freedom, because previously they were able to move Amendments to up-rating Bills and we cannot amend an Order. But I still agree with the noble Lord that this is a better way of dealing with fairly routine matters of up-grading benefits to match inflation in either earnings or prices.
I detected a slight note of satisfaction in the noble Lord's voice when he said

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it was the third up-rating since the Government took Office. I do not think that this is a matter for pride on either side of the House. The trouble is, as he touched on at the end of his speech, that inflation is going ahead at such a pace that we are running very hard on the treadmill of inflation to remain in the same place. In fact, one wonders whether we are, so far as the pensioner is concerned, still remaining in the same place and whether we are not going backwards. Already the annual rate of inflation is something like 35 per cent.
This Order comes into effect in November, by which time of course the value of the present pension will have been further eroded and the value or potential value of this new pension, up-graded by some l4½ per cent. for long-term benefits and just over 13 per cent. for short-term benefits, will equally have been affected by then. The figures in the order—the noble Lord mentioned the £13.30 for the single pensioner and the £21.20 for the married couple—will be worth a good deal less than that by the time they come into payment and thereafter will continue to be eroded unless something is done to bring this horrifying inflation under control.
Throughout the last few days we have been discussing in this House the ravages of inflation in one field or another. Last Wednesday we discussed the ravages of inflation in the case of charities. Earlier today we were speaking of the difficulty of investment in industry as a result of inflation, and of the financial effects on the pound we are only too well aware. It is equally important for the pensioners that this evil should be brought under control and, if possible, banished altogether. Although I agree with the noble Lord that it is absolutely necessary to protect the pensioner, the answer is not really to continue uprating, even at the six-monthly intervals that we would like to see. What must happen is that the present inflationary situation should be controlled.
This situation affects also the calculations that have been made for the order. Your Lordships will have seen the actuary's report which has to work on certain assumptions, including the assumptions that earnings are rising at 17½ per cent. per annum and that the unemployment figure is 850,000. These
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may be optimistic assumptions; as yet, we do not know. However, the actuary is obviously worried, because he goes on to point out that a change of 100,000 in the level of unemployment in a full year would alter the estimated deficit in his report of £368 million in 1975–76 by £115 million. That is a £115 million difference every time there is an increase in unemployment of 100,000 people. The deficit begins to become very large if unemployment rises beyond the million mark, which one fears might occur.
As those who try to run occupational pension schemes know, long-term stability is essential for proper pension planning. This upgrading is good and welcome as far as it goes, but for the pensioner as much as for everybody else, and for all those who are dependent upon social security benefits, the first priority to which the Government must give their attention is firm action to restrain our present inflation.
5.14 p.m.
Baroness PHILLIPS: My Lords, I shall not unnerve the Minister by suggesting that I am going to indulge today in a debate on pensions, but may I say in relation to inflation that it seems that here there is a very clear example of moving into what I can only call the politics of nonsense. One item will serve as an example. Those who are on supplementary benefit are to receive an increase for housing uprating, and one can only assume that part of the increase in what they are paying for their housing must be rates. One of the reasons why the rates are rising is because of the increase in the number of staff who are employed by local authorities to build up their extended empires. Therefore, through one State scheme we are paying money to people in order to pay that money back to the local authority for another enterprise which could have been dealt with at source.
It seems to me that the causes of inflation are not far to seek and that we perpetuate many of them by not looking for a sensible way of handling many of these finances both at local authority and central Government level. I am the last to suggest that we should not uprate pensions or, indeed, supplementary benefits, but I suggest that we should probably benefit our citizens if we got rid of some

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of the very laborious and complicated processes which in the end are much more expensive.
5.17 p.m.
Lord BANKS: My Lords, we must all welcome the increases in the benefits which have been so clearly explained to us by the noble Lord, Lord Wells-Pestell. In one sense it is encouraging to have two upratings in the year, but as the noble Lord, Lord Aberdare, has said, it is clear that the Government are hard pressed to keep up with inflation. In this matter they are in the same position as Alice and the Red Queen; they have to run faster and faster to stay where they are.
The noble Lord, Lord Wells-Pestell, will no doubt have seen the calculations which have been produced by the Child Poverty Action Group, who point out that, on the day when this uprating was announced, figures were made available by the Government which showed that in the previous three months the rate of inflation had been 34 per cent. It is their opinion that inflation is unlikely to be less, for reasons which they have set out, between now and November. On that basis they have made the calculation, taking April 1975 figures, that the pension for the single person—then worth £11·60—even with the increase would be worth £11·08 and that the married couple's pension of £18·50, even with the increase, would be worth £17·67. So everything depends on the rate of inflation. But even if those figures are too pessimistic, that the Government manage to keep pace with inflation and we find that the pension is worth the same after the increase in November as it was in April, there is still a period of considerable hardship, when you have inflation running at the rate at which it is running at the moment, before the uprating takes effect.
To conclude, I should like to ask a question which I do not believe is entirely irrelevant to the order which we are considering which covers, among other things, the non-contributory invalidity pension which was introduced by the Social Security Benefits Bill. When we were discussing that Bill the question was raised, whether that pension should not be at the same level as the contributory
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pension, and we were told that this was not right—that those who had contributed should have a higher rate of pension. Then I asked whether, in view of the fact that we understood that it was intended that the contributory invalidity pension should have an earnings-related component, this would not be a satisfactory difference. The noble Lord replied that this was speculation about future Government policy. But in point of fact, that very day—before we spoke, as it turned out—the Government had announced in another place their intention to base the contributory invalidity pension on an earnings-related basis. In view of that fact, and also that this is now incorporated in the Social Security Pensions Bill, can the noble Lord give me any indication of whether the noncontributory invalidity pension is, in consequence, likely to be raised?
Lord REDESDALE: My Lords, may I ask for one point of clarification from the noble Lord? It relates to the question of the electricity supplement, if that is the right term for it. Does this match the present increase, because I believe it varies from area to area, and how will it be affected by the proposed increase?
5.19 p.m.
Lord WELLS-PESTELL: My Lords, I am grateful to the House for giving by implication, if not explicitly, its support to this Bill. I did not intend to show a sense of satisfaction about the third uprating. I am sure that the noble Lord, Lord Aberdare, will understand that it is necessary from time to time. People forget what has been done, and it is important to point out that there have been three upratings in a comparatively short space of time.
I do not want to argue with the noble Lord on the matter of inflation. This is often a question of perspective and how these things are calculated. However, I took note of the light of battle in his eye and also in the eye of the noble Lord, Lord Banks, when the Social Security Pensions Bill was mentioned. I have seen the figures given by the Child Poverty Action Group, and, as I said, we do not accept them. I think it would be very difficult to prove that inflation is running at a level of about 34 per cent. or 35 per cent.

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With regard to the heating supplement—I think that is the phrase which the noble Lord was looking for—this would depend to a large extent, if not entirely, on the needs of the individual. One has to bear in mind that some pensioners are almost housebound, some are almost bed-bound, and one has to take into account their respective needs. Bearing that in mind, the amount which a pensioner would need might vary between two people living next door to each other but in different circumstances. This seems to us to be the fairest way of dealing with the matter. I hope the noble Lord feels that he has had a satisfactory reply.
I do not know the answer to the point raised by the noble Lord, Lord Banks. I am not quite clear what the situation is, but if he would agree that I might look at it and let him know, I should be glad.
On Question, Motion agreed to.

SUPPLEMENTARY BENEFIT (DETERMINATION OF REQUIREMENTS) (No. 2) REGULATIONS 1975.
Lord WELLS-PESTELL: My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the Draft Supplementary Benefit (Determination of Requirements) (No. 2) Regulations 1975, laid before the House on 11th June, be approved.—(Lord Wells-Pestell.)
On Question, Motion agreed to.

GUARD DOGS BILL
5.23 p.m.
Lord GORDON-WALKER: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Gordon-Walker.)
On Question, Motion agreed to.
House in Committee accordingly.
[Baroness Tweedsmuir of Belhelvie in the Chair.]
Clause 1 [Control of guard dogs]:
Lord de CLIFFORD Lord de CLIFFORD moved Amendment No. 1:
Page 1, line 10, leave out ("chained up or otherwise secured") and insert ("securely kennelled")
The noble Lord said: On Second Reading I raised some doubts on the wording of "chained up or otherwise secured". The chaining up of dogs has never been very acceptable, because if it is baited or excited considerable damage can be done to the dog if it is chained up. The chain, to whatever it is attached, can come loose, the dog can slip its collar, and the object of the Bill, which is to protect the public and children from being assaulted by dogs, is not attained. In addition, there is the device called a running lead. This is a lead which can be attached to a wire running through the centre of a yard or between buildings, or anywhere suitable. I believe that that can be considered "chained up", and yet accidents have occurred involving children. I therefore ask the Committee to insert the words "securely kennelled".
One of the reasons why I suggest "securely kennelled" is that you can securely kennel a dog by shutting it up in a room which is secure or you can shut it up in a kennel. The noble Lord who moved the Second Reading of this Bill said that the cost of providing kennels would be a great hardship to the man or the firm hiring out the guard dogs. But there is a collapsible kennel which I understand has been tested by the police and by Securicor, and which has been thoroughly approved by the RSPCA and the Canine Defence League. I suggest that if people are going into the business of providing guard dogs, it is their duty to provide proper accommodation for the dogs. I beg to move.
Earl COWLEY: I should like to support my noble friend in his Amendment. There is a certain amount of doubt about the precise meaning of the words, "otherwise secured". As pointed out by my noble friend, the use of a running or a ring lead is now quite common and there seems to be some doubt as to whether this comes within the term, "otherwise secured". The use of these ring leads permits the animal to wander about a large area of the premises which it is meant to be guarding, and there is thus a risk to

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any trespasser or other individual who might get into the premises. If guard dogs are to be used to protect premises, or to protect people guarding premises or property on them, I do not think the job should be done on the cheap. It is not the reputable firms one is worried about. They especially the members of the British Security Industries Association, follow a tight code of practice which fits in well with and reflects the Government's own voluntary code of practice which was issued last February. One is trying to get at the "one-man bands" which operate packs of dogs which are so overstretched that they cannot visit all the dogs in one evening. Therefore you have dogs roaming about property or premises without any strict form of control.
The creation of the portable kennels mentioned by my noble friend would permit the guard dogs to be properly kennelled when they are on the premises and when the handler is otherwise engaged. It does not involve the building of kennels in each of the premises on which the guard dogs might be placed. There is also another factor; that is, the increasing habit among children to bait guard dogs. It is a regrettable practice. It is exceedingly dangerous and is very unfair to the animal concerned. If the guard dog is kennelled, this reprehensible habit and pastime would be reduced. I beg to support my noble friend's Amendment.
Lord SOMERS: I should like to support the Amendment half-way, as it were. Certainly there is no more cruel way in which to keep a dog than on a chain. Of course the phrase, "otherwise secured" can be interpreted in a variety of ways. I have noticed several houses where, for instance, a guard dog is kept in the garden but behind locked gates so that it cannot possibly get out into the street to anybody who is approaching the house. But it can see them approaching perfectly well and make it plain that they should not approach too close. I think that is probably the ideal way, because a dogs wants freedom of movement and unless there is a very long ring lead such as has been described, he will not get that freedom of movement. Therefore I should have said that "otherwise secured" should include shutting behind iron gates
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so that the dog cannot have access to the road.
Lord GORDON-WALKER: I think the noble Lord, Lord de Clifford, really fears that there will be a lengthy chaining or tying-up of a guard dog on premises, but the purpose of the Bill is that it should be only during very short periods, indeed, when, for example, the handler is cooking a meal or making himself a cup of tea. Clearly, there must be some provision for this in the Bill, because the man may be on duty for a good many hours. After all, the main requirement of this Bill is that the guard dog should be under the control of the handler at all times, who must himself be present on the premises.
Certainly, the provision of kennelling would involve some extra cost which would fall on the owner of the premises, and there are quite a number of small owners of premises who would already find it difficult to meet the provisions of the Bill. Providing the handler, for instance, is expensive and, in consequence, there will be some property which will be less well guarded than it is now because the owner of smaller premises may not be able to afford a guard dog, or for that matter, a kennel. In order to avoid maltreatment of a dog, there should be some definition of a kennel in this Bill. One can kennel a dog in a bad way. There is no provision here that it shall be a mobile kennel. It may be a kennel in which the dog is shut up in the dark. It seems to me that this Amendment is not necessarily a safeguard against maltreatment, although, none the less, it would still be for very short periods.
If the dog were allowed to run on a chain lead, or whatever it is called, so that it could really run at large this would be against the provisions of the Bill. The whole purpose of the Bill is to stop a dog running at large in premises which it is guarding; it must be under the control of a handler. This might be a matter of fact for a court to decide, but I doubt very much whether that would come under the Bill. It should also be remembered that this creates a new criminal offence for which there is a fine of up to £400. It is a serious thing to create new offences of that kind, and it seems to me that if there were cruelty or mishandling of a dog in any

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way the right thing is not to put new offences into this Bill but to seek a remedy under the Protection of Animals Act 1911. That seems to me to be better than burdening this Bill with the creation of new offences. I hope the noble Lord will agree to withdraw his Amendment.
Lord de CLIFFORD: I am not very happy with that reply; I think the noble Lord has misunderstood the object of this Amendment. I would not say that, "securely kennelled" is necessarily the correct wording but the point at issue is that the dog might be left only for a short time; but if there is a running lead, which is accepted as being chained up, the handler can go in, have his tea, put his feet up and have a nap because the dog is running free on his lead and can raise hell when anybody approaches, when the handler can come out, take him off the lead and the dog is under his control again. I think the noble Lord has also misunderstood in regard to the provision of the mobile kennels. Such provision would be the responsibility of the people providing the guard dog.
Lord GORDON-WALKER: Not necessarily.
Lord de CLIFFORD: It is up to the people who employ him. My own view—and I trust that it will be considered again—is that it is the business of the people providing the guard dog to provide the proper equipment to work the guard dogs. I feel most strongly that this is not a good expression to use and it is most unnecessary that everything which is in doubt in this Bill has to be decided in a magistrates' court. I appreciate what the noble Lord has said. I will not press this Amendment at this moment, but I shall consider it and perhaps we might discuss the matter and return to it at Report stage. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.38 p.m.
Earl COWLEY Earl COWLEY moved Amendment No. 3:
Page 1, line 20, at end insert ("and at intervals of 150 feet along the periphery of any wall or fence by which the premises are surrounded.")
The noble Earl said: Under Clause 1(3) as drafted in the Bill a person who uses guard dogs on his, or any, premises is required to put up a warning notice
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at each entrance to those premises, but he is required to put them up only at the entrances. Some of the premises are, for example, scrap yards, goods yards, large yards belonging to metal merchants and they cover a vast area of ground and are usually surrounded by walls or some form of fencing. Thus one can approach these premises without seeing the notices at the entrances. While it is possible to ensure the condition of the fencing by regulation under the Bill, there have been occurrences, as at Glasgow, where the guard dogs can, in fact, get out, with tragic results.
Thus it would seem only logical to extend the requirement to put up notices to include the periphery fencing and walls around the property, so that when people approach these establishments they can be forewarned that there are guard dogs inside. It also has the added advantage of being an extra deterrent against any potential trespasser. I beg to move.
Lord GORDON-WALKER: I think the prime objection to this is a technical one of definition, which I will come to in a moment, but I cannot quite see how the noble Earl can say that someone could go in without seeing the notice. He can go in only at the entrance and even if it is a large place—a factory or anything else—unless he climbs over the walls he must go in at the entrance. Even notices at intervals of 150 yards would not stop somebody climbing over a wall if he is desperate or stupid enough. The purpose of this Bill is to give people legitimate warning when they enter premises by the gates.
I now come to the difficulties in the Bill. After all, this creates a criminal offence, with a penalty up to £400. If the fence were 280 ft. long, it would be difficult to say where the notices should be, how many there should be, and where. For instance, if someone stupidly expected the notices to be at intervals of 160 ft. or, indeed, less—let us say, at intervals of 148 feet—he would have committed an offence against the Bill. This is a difficult point, because the Bill has to be enforced. If offences are created against it the magistrate will not, of course, impose the full fine of £400, but he could impose a fine up to that. The Bill needs to be extremely carefully defined, because we are here creating

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criminal offences. We cannot do it in a casual way. I suggest to the noble Earl, Lord Cowley, that this needs a rather different kind of formulation if this is to be at all workable.
Lord de CLIFFORD: I support my noble friend. I would ask the noble Lord, Lord Gordon-Walker, whether he has not accepted the principal, in fact, and is just arguing about distance. My view is that if you have a long perimeter fence of 600 yards or 700 yards with a gate at one side and a gate at the other, and it goes round in a big circle with only two notices on it, that is entirely wrong. There should be many more. At one time. I had a workshop around which was a perimeter fence for a distance of something like three-quarters of a mile. We had some trouble because people came over this fence and were very surprised when they met the guard dog. They thought there was a short cut across. I would suggest that if you have a fence of whatever distance you like, there should be more notices at the entrances and exits.
Earl COWLEY: I feel that the noble Lord, Lord Gordon-Walker, has been rather unreasonable in his attitude to my Amendment. This Bill is concerned with reality. Children are tempted by vast areas, by scrap yards which are not properly surrounded with walls or fences which, in turn, are not in proper repair. To say, "They should go through the entrance" is really not good enough. The noble Lord mentioned the penalty provisions and the fact that it was creating a new offence. The penalty of £400 is a maximum—
Lord GORDON-WALKER: I said that.
Earl COWLEY: The court can impose anything from ½p up to £400, depending on circumstances. If the noble Lord is worried about what exactly is the right distance to come into the terms of the Amendment, the same criticism can be made of the subsection as drafted. What is meant by "at the entrance"? Would the owner of the property have committed an offence if it were five yards or five feet away from the entrance on either side? I do not know. The courts would apply the rule of thumb to what
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is a reasonable line to take, so I think the noble Lord has been slightly legalistic about the Amendment. However, I will willingly take it back and look at it again to see whether I can draft something more to his liking.
Lord WELLS-PESTELL: Before the noble Earl, Lord Cowley, is good enough to withdraw his Amendment, one needs to bear in mind that we want to keep it as simple as possible. I hope the noble Earl will not mind if I point out that one of the main, if not the main, provisions of Clause 1 is that the handler must always be present with the dog, and that the dog must be either under his immediate control, or secured. If one takes that and keeps it in the forefront of one's mind, one may find that what the noble Earl is suggesting is not necessary. Nevertheless, I am grateful to him for saying that he will take back the Amendment. We have looked at it very carefully. It may well be that on reflection, the noble Earl may feel the situation is adequate.
Lord GORDON-WALKER: If the noble Earl, Lord Cowley, can produce something that will stand up in law, because one must be a little legalistic when imposing penalties, of course we will look at it.
Amendment, by leave, withdrawn.
5.45 p.m.
Lord de CLIFFORD Lord de CLIFFORD moved Amendment No. 4:
Page 1, line 20, at end insert—
("( ) Until such time as regulations are made under section 3 it shall be the responsibility of the owner or handler of a guard dog to ensure that it is kept in secure conditions and good health while not employed as a guard dog.")
The noble Lord said: We are now coming to the situation envisaged by this Bill. Clause 1 can be brought in at any time, and the quicker the better, but this clause concerns only the premises on which the dogs are working. There is nothing to say how the dogs are to be kept by the people who produce these dogs, until one comes to regulations to be made at a later date. It is well known to all the societies who deal with cruelty towards dogs that, in some circumstances, these guard dogs are kept under shocking conditions. It seems to me very bad that we should continue to permit dogs to be kept as anybody feels they would like to keep

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them, until such time as it is considered correct to make regulations to ensure that the dogs shall be kept in a certain way.
I move this Amendment merely to try to ensure that until such time as regulations are made, it shall be the responsibility of the owner of the dog, or the handler of the dog, or whoever keeps the dog, that they shall maintain it in reasonable health. I beg to move.
Lord GORDON-WALKER: I can assure the noble Lord, Lord de Clifford, that it is the intention of the Home Office to bring in Clause 1 as quickly as possible. The licence provisions may take longer because of the need for consultation. I have great sympathy with the intentions of the noble Lord, Lord de Clifford. However, I am afraid there are two rather considerable difficulties in the way. First of all, this creates a new punishable offence, but it creates a temporary punishable offence which is really a rather dubious thing to do, because it is not the intention of the Government to impose any penalties in the regulations. Therefore, there would be a penalty in the Act until the regulations came in, when it would cease to be an offence, because the Government are to rely on the right of local authorities to impose conditions for granting a licence, or revoking a licence, to control how dogs are treated in guard dog kennels. The noble Lord is asking us, therefore, to create a temporary criminal offence, and a not very long-lasting one, if this clause is brought in quickly.
The other matter is a technical difficulty which I do not think can be overcome unless Clause 6 is amended, which would be difficult to do because the dog is only a guard dog under the Bill while it is being used as such to guard premises. It is not a guard dog as described in the Amendment, for instance, when it is in kennels. Unless the noble Earl can discover some way of amending Clause 6 without "mucking up" the whole Bill as well, I do not see how he can escape from this difficult point. It is, in fact, improper to describe it as a guard dog, as the noble Lord does in the Amendment, because it is not a guard dog until it is on duty under a handler, guarding premises and the other things covered in Clause 6. I hope that the noble Lord will withdraw the Amendment.
Lord LLOYD of KILGERRAN: I had not intended to say anything in this debate but, having heard the noble Lord who has just spoken, may I rise if only to display my ignorance as to the scope of the Bill? In listening to the noble Lord speaking about these matters, I have been a little worried about the position of farmers or farm labourers who have guard dogs for ordinary agricultural purposes in the course of farming activities—looking after sheep and so on—and these dogs are often used for the protection of premises. May I ask whether farms are excluded from the definition of "premises" or whether small farmers, particularly in Wales, have to be very careful to get licences for the use of dogs? There is the exception under Clause 6 to which the noble Lord referred, "land within the curtilage of a dwelling-house". I am wondering whether the noble Lord can assist me in my ignorance as to the use of dogs on small farms.
Lord GORDON-WALKER: I can quite understand that the noble Lord does not quite understand it, because although this looks a simple Bill it is in fact very complicated and the drafting is very difficult. He is quite right in saying that a dwelling-house is excluded, and a farm house is also excluded. This is not meant to interfere with the rights of private people if their dogs occasionally bite people, and this does happen. One cannot protect everybody against everything. This is to protect people against being bitten by dogs guarding premises, where they have a handler and so on. The farmer would not need a handler, nor would the private person in a dwelling-house, who would keep what would normally be called a guard dog but which would not be a guard dog under the terms of this Bill.
Earl COWLEY: I should like to support the intentions of my noble friend's Amendment. As drafted this is an unusual Bill, because it does not include any provision or outline for the treatment and keeping of animals. It is in complete contradiction to Section 1(3) of the Animal Boarding Establishments Act 1963, Section 1(4) of the Breeding of Dogs Act 1973 and Section 1(3) of the Pet Animals Act 1951, all of which include outline provisions for the treatment and keeping of dogs. If I might

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quote one sentence from Section 1(4)(a) of the Breeding of Dogs Act 1973, it says:
"… dogs will at all times be kept in accommodation suitable as respects construction, size of quarters, number of occupants, exercising facilities, temperature, lighting, ventilation and cleanliness …"
I think this is a shortcoming in the Bill. I accept that there are certain drafting problems with the Amendment. However, to answer the noble Lord's criticism of the use of the words "guard dog" in the Amendment, it could be got round by deleting the word "guard" and inserting in brackets after it the words used in Clause 2(2) "when not being used as a guard dog". That might answer some of the points the noble Lord raised.
Lord GORDON-WALKER: With the leave of the Committee, the noble Earl can certainly try that on Report stage, but I do not think it will get any further. Of course, all the Acts against cruelty to dogs and animals apply; they are taken for granted in the Bill, and it is assumed that the control of proper conditions in a kennels will depend upon the local authority's licensing. This is the remedy. If someone does not keep properly dogs which he is going to let out as guard dogs, he can have his licence removed. That is a very grave remedy.
Lord de CLIFFORD: The noble Lord is confusing the position very considerably. I have in the back of my mind what I understood was said on Second Reading, that Clause 1 would be brought into operation quickly, but for the remaining clauses, requiring operation and work by the local authority, no specific time or distance in time could be given. We may have Clause 1—the principle of which I entirely support—in operation, but still we shall not ensure that, as in every other Act, the conditions under which the dog shall be kept are laid down. I cannot see any reason why we do not either put what appears in the Animal Boarding Establishments Act or the Breeding of Dogs Act into this Bill as it stands, or put in something which may be agreed, to ensure that these dogs shall be kept properly. That is the intention of my Amendment, that when dogs are not being employed as guard dogs they should be properly kept. I am not a Parliamentary draftsman; my wording may be quite wrong. I would accept that
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the wording is wrong, but before Report stage perhaps we can look at it again and come to some arrangement.
Lord GORDON-WALKER: Before the noble Lord withdraws the Amendment, may I say that I am very sympathetic to his intention but I think it will be rather difficult to achieve it. We will certainly look at this matter between now and Report stage, and I will write to the noble Lord and to the noble Earl.
Lord de CLIFFORD: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.59 p.m.
Lord de CLIFFORD Lord de CLIFFORD moved Amendment No. 5:
Page 1, line 20, at end insert—
("( ) Until such time as regulations are made under section 3 any vehicle employed in transporting a guard dog shall at all times be clearly marked that it is so employed.")
The noble Lord said: This Amendment again, the noble Lord will tell me, is subject to drafting errors, but perhaps I might move it to try to get the principle over. Dogs are moved, and they are moved whether or not the regulations are in operation. I am sure this Bill has the intention of protecting the public, particularly children and young people. My Amendment is an endeavour to see that people shall know when guard dogs are being moved from kennels to their place of work. I admit that the drafting may be wrong, but I still think that the principle should be in Clause 1, which can be brought into operation straight away. I beg to move.
Lord WALLACE of COSLANY: Perhaps I may intervene briefly to obtain clarification. This Bill refers to guard dogs on premises, and the Amendment refers to guard dogs being transported. The point I want to clarify is this. Will this cover guard dogs being used on vehicles for the protection of the contents of the vehicles? As one, like many others, inclined to pat a dog when one sees one, I know that one can have a rude shock. There are a number of vehicles going around with dogs of all shapes and sizes and pedigrees acting as guard dogs on them, not being transported from kennels to the place of work but actually on the job in the transport. Does this Amendment cover that point?
Earl COWLEY: While accepting that my noble friend's Amendment may not be perfect, and also that it creates a new offence—to get out of the way those two arguments which the noble Lord might use—
Lord GORDON-WALKER: I will.
Earl COWLEY: —I think it is important to recognise that a guard dog is just as effective or as dangerous when it is being used as a guard dog as when it is not. It is still the same animal, and therefore the standard of control over the dog should be the same. Therefore, it is only right and logical that the standard of warning to the public should be extended to the vehicle in which the dog is being carried. Whether it is done by this Amendment or by any other form of words, is a matter for consultation. When lorries are carrying dangerous products they are subject to regulations, and I can see no real difference between that and vans carrying dogs used for guarding property.
Lord GORDON-WALKER: I must tell the noble Lord that this Amendment too is defective. Obviously anyone is sympathetic with the purposes of an Amendment if one can find a way of drawing it up or making an addition to the Bill to meet the point. We will look at this with our best advice to see whether we can arrive at anything and will write to him accordingly. So far as my noble friend is concerned, the Bill does not cover dogs in gardens, houses, farms and cars. It does not deal with the private owners of dogs. If you start doing that then you are interfering with thousands of people and you would need to have an enormous inspectorate to enforce it. This Bill does not attempt to deal with all dogs. There is a Working Party looking at the whole problem of the law regarding all dogs. This Bill deals with a very limited problem, that of rendering guard dogs on premises no longer a danger to the public.
Lord WALLACE of COSLANY: I am not referring to privately-owned dogs. I am referring to dogs which are carried on commercial vehicles for the protection of goods on those vehicles. If we are to have signs set up on premises to indicate that guard dogs are on duty, then I think that commercial vehicles
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which carry dogs for a similar purpose should be so marked.
Lord GORDON-WALKER: It would be extremely difficult to bring that within the terms of this particular Bill. It might be possible to do something when the Working Party of the Department of the Environment who are looking into the whole problem of dogs has reported. It may be possible then to get some legislation to deal with the wider problem. In the meantime, pending the Report of the Working Party, this Bill has a very limited but an important purpose, because a great deal of the mauling of children comes from this kind of guard dog. We are not interfering here with the owner-ship of dogs or with commercial vehicles; we are dealing with premises.
Lord de CLIFFORD: I have great sympathy with the noble Lord who raised the subject of dogs in cars. When we come to Clause 6 there is such an astonishing muddle that one can pretty well read into it anything one likes, including dogs in cars so long as they are not within the curtilage of a dwelling-house. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 1 shall stand part of the Bill?
16.4 p.m.
Earl COWLEY: I should like to raise a couple of points on Clause 1. At Second Reading the noble Lord, Lord Wells-Pestell—and this was repeated today by the noble Lord, Lord GordonWalker—said it was hoped to bring in the provisions of Clause 1 as soon as possible after the Bill became law. I wonder whether the noble Lord could be more precise about the time scale that the Government are thinking about, and whether the noble Lord could give a date by when he hopes the Government will be able to introduce the provisions of Clause 1.
Furthermore, in another place it was stated that farm dogs were not covered by the Bill because of the definition of "premises" and "guard dogs" in Clause 6. This point was raised by the noble Lord, Lord Lloyd, a few minutes ago. My understanding of the Bill is that Clause 1 covers all dogs used to guard premises or persons or property on the premises, whether the dog is hired

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out or belongs to the owner of the premises. I understand that a farm is not entirely a dwellinghouse; it is also a commercial premises, as defined by Clause 6. Could the noble Lord say whether farm dogs are covered by Clause 1 when used to guard the outbuildings of a farm, and if a farm dog which belongs not to the owner of the farm but to one of his employees and that animal is then used to guard the premises of the farm, the outbuildings, the combine harvester, and so on, whether he is covered by Clause 1 and also by Clauses 2 and 3?
Viscount COLVILLE of CULROSS: Is not the situation that the dog on the farm is a guard dog and therefore Clause 1 applies; but the farm is not guard dog kennels and therefore Clause 2 does not apply? Is that not the true situation when reading these definitions in Clause 6?
Lord GORDON-WALKER: The intention of the Bill is that it should not apply to farms. It is certainly not a guard dog kennels, for no one is hiring out dogs. If the noble Earl is right in saying that unintentionally a farm might be included in this because it is premises, then I will look into it. The clear intent it to exclude farms and dwellinghouses. If it is found that the Bill does not do so, then we shall look to make absolutely sure that it does.
Lord WELLS-PESTELL: If I may first reply to the noble Earl on the question of the date of the provisions, this has not been decided. There is bound to be a time lag and there is no use pretending that there will not. There are various concerns to be considered, the British Security Association and other bodies. It is the intention of the Government as soon as these discussions are complete and one can see clearly the framework in which they have to work, to bring them in as quickly as possible.
Earl COWLEY: We are talking in months rather than years, are we not?
Lord WELLS-PESTELL: There would be no point in having this Bill if we were talking in terms of years.
Lord GORDON-WALKER: No, not years.
Lord de CLIFFORD: My noble friend raised the subject of the farm dog which is looking after the tractors and the hay, and so on. I believe that in another place the subject of dogs used by keepers was also raised, to which I never saw an answer. When out with the keeper, is a dog which he uses to guard his premises and the area where he is responsible for the game and the kennels that dog is put in, a guard dog subject to Clause 1? If he is a guard dog there, can he be considered, under the definition of premises, that when he goes home to an ordinary kennel at the back of the keeper's house he ceases to be a guard dog and the kennels have not to be licensed?
Lord GORDON-WALKER: What is meant by the definition is finally settled by a court. I think it would be very far fetched for a court to say that the area where a gamekeeper is looking after birds and so on are premises. I think also that his kennels would not be premises. It would be so unlikely that the courts would so decide or that anyone would bring an action against him that I think one can say that a gamekeeper would not come within the Bill.
Viscount COLVILLE of CULROSS: The point is exactly the same as that of the farm, with respect to the noble Lord. "Premises" means land, and the land that the guard dog is guarding is certainly premises and, if the dog is there to protect that land or property on that land which, I imagine, includes animals and birds, it is a guard dog. The argument on that is exactly the same as that about the farm. I feel that the noble Lord should look at that again.
Lord GORDON-WALKER: I will do so.
Lord SLATER: I have listened attentively to the observations which noble Lords have been making in regard to the clause. I believe that my noble friend Lord Gordon-Walker has done a remarkably good job in drafting a very complicated measure to cover the position so far as these guard dogs and the protection of property are concerned. I have friends who are farmers who have dogs. Let us take as an example a farmer who has a very big herd of milking cows. At

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some time during the day the milk has to be collected. A dray makes its way along the drive towards the place where it is to pick up the milk. If dogs are running amok, as it were, does anyone believe for a moment that the driver will seek to enter? Of course he will not, unless those dogs are tied up or are under serious control. Those dogs are under the control of the farmer and he will make quite sure that they are under his direct control and cannot get out unless he releases them, which he will not do until after the milk has been taken away.
I believe that one can carry this a little too far. When we talk about land, some landowners may have four or five farms, which may be of 500 or 600 acres of land. On the other hand, a farmer may have only 100 acres and he will need his dogs because his livelihood depends on what he produces upon that land. I believe that we are apt to carry this a little too far and that we do not give credit to the owners of land who have dogs. In accordance with the Bill, such a dog must be under careful use and proper control, without causing damage either to persons or to anything else that may come on to the premises of the farmer.
Earl COWLEY: I do not think that anyone in this House is criticising the great work and effort which the noble Lord, Lord Gordon-Walker, has put into the Bill. We are all in favour of the intentions underlying the Bill, but we want to ensure that it is a better Bill when it leaves this House than when it came here.
The problem of farm dogs can be put very quickly. Dogs are often used in farms and are allowed to run around the farm building to protect the property while the farmer and his employees are away, especially at night. If that is done, that dog comes under—
Lord SLATER: The noble Earl will agree that what he is now saying is an assumption. That is a pure assumption. He is not sure of his facts.
Earl COWLEY: It is an assumption based on experience. I have not been a city dweller all my life and I know a few people who own farms. This does take place. As the definition of "guard dog"
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in Clause 6 is drafted, a farm dog that is used to guard property comes under the terms of that definition, so the argument hinges on whether a farm comes in the definition of "premises" or whether it is excluded from that definition because it can be defined as a dwellinghouse and the curtilage of a dwellinghouse. I do not believe that it can, and I believe that the Bill as drafted covers farm dogs that are used to guard the out-buildings. If the animal belongs to the owner of the farm, then he does not come under Clauses 2 or 3. If it belongs to one of his employees, he is not saved by the proviso in Clause 6 which says,
"other than a dog which is used as a guard dog only at premises belonging to its owner"
because the premises do not belong to the dog's owner. Therefore, the employee is subject to Clauses 2 and 3.
Lord GORDON-WALKER: I must admit that the noble Earl has sown a seed of doubt in my mind. I am not quite sure—though I had understood that it was so—that the definition of "premises" is drawn sufficiently clearly to exclude farms. It is certainly the intention to do so, but I shall look at this. I am grateful, because I believe that the noble Earl has put his finger on a weak point here.
Clause 1 agreed to.
Clause 2 [Restriction on keeping guard dogs without a licence]:
On Question, Whether Clause 2 shall stand part of the Bill?
Earl COWLEY: The clause as drafted is very complicated to understand. Under the Bill a "guard dog" appears to be a guard dog only when it is used to protect premises, property kept on the premises or a person guarding the premises or such property. Otherwise it can only be defined as a dog. Further, a guard dog kennel is only a guard dog kennel when a person keeps a dog which is used as a guard dog elsewhere. Otherwise it is purely a kennel. Therefore, I should have thought that the words in brackets in subsection (2) "when not being used as a guard dog" were legally superfluous. I believe that the reason why these words were not used after the word "dog" in subsection (1) is that they are superfluous and are not needed. However, they have

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the very great advantage that they help one to understand what the clause means without referring to all the definitions in Clause 6. Therefore, I want to ask the noble Lord whether he will consider an Amendment at Report stage to insert the bracketed words in subsection (2) into subsection (1) after the word "dog".
Another point is that it appears from subsection (1) that the licence for the guard dog kennels has more connection with the owner of the guard dog kennels rather than with the kennels themselves. I should be grateful if the noble Lord, Lord Gordon-Walker, could clarify a rather small, but important point: is the private owner of a guard dog who does not have licensed kennels for his own guard dog, because it is privately owned and is used only to guard his own premises, permitted to keep his dog in someone else's kennels which are licensed? The question hinges on the definition of the word "keep". Does the word mean, "to possess", or "to own", or "to look after"?
Lord GORDON-WALKER: I admit that this is an extremely difficult clause. I am not sure that the suggestion by the noble Earl would make the matter any simpler; and the draughtsman could probably make it even more complicated. I think that the word "keep" includes all the meanings the noble Earl mentioned. It could be "to own", it could be "to possess", or it could relate merely to keeping somebody else's dog.
Lord SOMERS: Another point arises regarding whether or not a guard dog is a guard dog. Surely it always is a guard dog, because a guard dog is such by reason of its training. Therefore whether or not it is on duty, it will still have the same nature and will be quite likely to attack anybody but its owner, if not in control. Therefore I should have said: once a guard dog, always a guard dog.
Lord GORDON-WALKER: That might be normal sense and usage, but not in this Bill. A guard dog is only a guard dog as defined in Clause 6. If we took the wider definition of guard dog we should have to look at everybody's guard dog all over the place—in a dwelling house, or in a garden; indeed, anywhere. But the Bill does not try to do that, because that would be impossible to enforce.
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So, although in one sense a guard dog is always a guard dog, it is here a guard dog only if it is guarding premises.
Lord WELLS-PESTELL: I should like to assist the Committee and, perhaps, at the same time get the best possible results from the Bill. I do not suggest that we should in any way short-circuit the situation this evening, but take the Amendments as set out. Noble Lords have raised a number of matters which we must look into, and my noble friend, Lord Gordon-Walker, has made that perfectly clear. I wonder whether it may help at the Report stage and subsequent stages if the noble Lord, Lord de Clifford, the noble Earl, Lord Cowley, and the noble Viscount, Lord Colville of Culross, felt that some useful purpose could be served if they could meet us, with the officials, with a view to seeing what we can do in this matter, rather than to have protracted and unnecessarily long proceedings.
Viscount COLVILLE of CULROSS: I am very grateful to the noble Lord. As I was one of those specifically invited, I should like to raise one point. The point that I should like to discuss has now been made twice by the noble Lord, Lord Gordon-Walker; namely, that a guard dog is a guard dog only when it is guarding. I do not think that Clause 6 need necessarily be interpreted in that way, because if the dog is used to protect, there are times of the day when it is being used to protect and that qualifies the dog. It is capable of being interpreted as being a guard dog even when it is off duty. If we put in a provision to the effect: "means a dog when being used to protect", then it would be clear. But I agree that there are a number of points on which it would be helpful to go into in detail, rather than raise them on the question, Whether the clause shall stand Part?, and I shall happily accept that invitation.
Earl COWLEY: Anything which would help to improve the Bill, through consultation and negotiation, is very welcome.
Lord de CLIFFORD: I join my noble friends in saying that I think it would be most helpful to do what has been suggested. The Bill is a very complicated Bill. The noble Lord who now unfortunately is not in his place seemed to

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think that we were merely being niggardly. But we have often been told in this House by most noble and learned Lords that it is the words which we put into these Bills which matter when it comes to interpretation. When we go into these matters we are not trying to be niggardly; we are raising points based on the way the Bill appears to us.
Clause 2 agreed to.
Clause 3 [Guard dog kennel licences]:
6.25 p.m.
Earl COWLEY Earl COWLEY moved Amendment No. 7:
Page 2, line 23, after ("1912") insert ("the Pet Animals Act 1951 or the Animal Boarding Establishments Act 1963 or the Breeding of Dogs Act 1973")
The noble Earl said: I beg to move Amendment No. 7. The purpose of Clause 3(4) is to permit the courts to cancel the licence for guard dog kennels where the holder has been convicted under the Protection of Animals Act 1911 or the equivalent Scottish Act. These two pieces of legislation are concerned with the protection of animals against ill-treatment or cruelty. It would be wrong to allow anyone who has been convicted under these Acts to run a guard dog kennel and look after dogs. Similar provisions are contained in the Pet Animals Act 1951, the Animal Boarding Establishments Act 1963, and the more recent Breeding of Dogs Act 1973.
To one extent or another these pieces of legislation are concerned with the treatment of animals within each Act's area of interest. However, unlike the Bill before us, the other pieces of legislation go much further. For example, Clause 3(3) of the Breeding of Dogs Act 1973 says:
"Where a person is convicted of any offence under this Act or of any offence under the Protection of Animals Act 1911 or the Protection of Animals (Scotland) Act 1912 …"
and that is where the Bill is similar to the Act. It goes on further. It includes the Pet Animals Act 1951 or the Animal Boarding Establishments Act—
Lord GORDON-WALKER: Perhaps I might save time, if I interrupt the noble Earl to say that I should be very happy to accept this Amendment.
Earl COWLEY: I thank the noble Lord.
On Question, Amendment agreed to.
Earl COWLEY Earl COWLEY moved Amendment No. 8:
Page 2, line 24, at end insert—
("(4A) Any person aggrieved by the refusal of a local authority to grant such a licence, or by any condition subject to which such a licence is proposed to be granted, may appeal to a magistrates' court; and the court may on such an appeal give such directions with respect to the issue of a licence, or as the case may be, with respect to the conditions subject to which a licence is to be granted, as it thinks proper.")
The noble Earl said: I beg to move this Amendment, and with the leave of the Committee I also wish to speak to Amendment No. 9, because the two Amendments are linked. Under the Bill as drafted the right to appeal is dependent upon the regulations being drafted by the Secretary of State. This right is not an obligation upon the Secretary of State. The relevant word in Clause 5 is "may". When I raised this point with the noble Lord, Lord Wells-Pestell, the other day on Second Reading, he answered:
"I should have thought that if regulations contained authority for a local authority to revoke a licence they must also state the rights a person has if he or she wishes to appeal."—[Official Report, 20/6/75; c. 1195.]
I could not disagree with that more. I believe that it is the right of everyone to go to the courts if they have a grievance. I do not believe that that right should be made dependent upon the say so and good will of the Secretary of State. In all the Acts mentioned today there is provision inserted in Statute to allow people to appeal to the magistrates' court. The wording of my two Amendments is taken from the Breeding of Dogs Act 1973 and it comes word for word from Section 1(5) of that measure. If for any reason the Secretary of State does not make the regulations, the aggrieved person has no right of appeal. He maybe dependent on the local authority to offer him redress, or he may be appealing to the same people who refused the permission or imposed the conditions to which he objects. Therefore, this Amendment is essential to ensure that the Bill does justice to those who are covered by it.
Lord GORDON-WALKER: It is our purpose to do justice. This is one of the matters which I should be glad to discuss with the noble Earl before Report. I do not think the Amendment in the form in which he has moved it is satisfactory, but I am sure that we can find a form of words which will put the right of appeal in the Bill and fix the procedural matters. With that assurance, perhaps he will withdraw the Amendment and agree that it is a matter which we can discuss between now and the next stage.
Viscount COLVILLE of CULROSS: I have come upon this difficulty under the Caravan Sites and Control of Development Act 1960, which is not the same subject matter but which has a similar right of appeal against the magistrates in respect of conditions laid down by the site licensing authority. There is, however, no right of appeal to the Crown Court under that Act, and I think I am right in saying that if one wants to have a right of appeal to the Crown Court in legislation one must specifically state that in the legislation. It may be that one petty sessional district is imposing different conditions or applying different standards from another, and it may be right to give permission to appeal to the Crown Court.
Lord GORDON-WALKER: I understood that there was always a right of appeal to the Crown Court on fact and to another court on law, but I may be wrong and we can look into the matter between now and Report.
Earl COWLEY: Under normal circumstances I would willingly agree to accept the noble Lord's offer of consultation. But this is such an important issue, which goes to the very heart of the Bill, and so much is dependent on the regulations to be initiated by the Secretary of State that I must press the Amendment to a Division.
Lord WELLS-PESTELL: The noble Earl is being quite unreasonable. We on this side of the Committee could not have been more reasonable than we have been today. We have said that we are prepared to discuss everything that has been said so far and the noble Earl accepted that offer. I am sorry that he
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is going back on it. In my view, he is being unfair and unreasonable to the Committee.
Lord GORDON-WALKER: If the noble Earl insists on pressing the Amendment—and we have offered to meet him on it—he will have to move another Amendment on Report, because the one he is proposing today is not properly drafted; in other words, there will be two appeal references in the Bill and that will be extremely confusing. I beg him, with great friendship and in a desire to help him, to allow us to examine this together. After all, if he does not like the result of that discussion he can always return to the matter on Report. Otherwise, it would seem rather grudging of him.
Earl COWLEY: In view of what has been said I shall withdraw the Amendment, but I must say that as the Committee stage is, for good reason—I am not objecting to that reason—being held on a Monday and the Report stage will take place on Friday morning, that gives us only three clear days to consider the Bill further. Perhaps the noble Lord, Lord Wells-Pestell, would care to give a precise time when we can discuss these matters, because with only three days between Committee and Report we do not have much time in which to draft Amendments and examine the situation, especially as the Bill has to be back in another place by the end of next week if it is to become law, which we hope it will.
Viscount COLVILLE of CULROSS: I hope that my noble friend Earl Cowley will take the advice of other noble Lords.
Earl COWLEY: I said that I would.
Viscount COLVILLE of CULROSS: I am sure that we will get on more quickly if he will resume his seat and discuss these matters as suggested. I am sure that that can be done in time to draft agreed Amendments, even by Friday morning, and I am glad to note that my noble friend is prepared to withdraw the Amendment.
Lord WELLS-PESTELL: I am grateful to the noble Earl, Lord Cowley, for his accommodation in this matter. We want to do the right thing, to find the right words to put in the right place. I appreciate that the timetable is difficult,

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but as I feel there are only a comparatively few matters to discuss we should be able to do that by meeting soon. With respect, perhaps the noble Lords involved would care to meet immediately after tonight's Committee stage to have that discussion.
Earl COWLEY: On that basis, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 3, as amended, agreed to.
Clause 4 agreed to.
Clause 5 [Regulations]:
6.38 p.m.
Earl COWLEY Earl COWLEY moved Amendment No. 10
Page 3, line 15, leave out ("subject to annulment by resolution of either House of Parliament") and insert ("laid before, and approved by, resolutions of both Houses of Parliament").
The noble Earl said: We now come to the clause which gives the Secretary of State considerable powers to make regulations under the Bill. The powers are extremely wide and a good example of them are those contained in subsection (2), notably paragraph (a), where the Secretary of State can exercise his powers to make different provisions for different cases or classes. The purpose of this Amendment is to change the procedure in subsection (3) from the Negative to the Affirmative Resolution, so that the Minister will be required to come to Parliament and be answerable to Members of both Houses about the regulations he has drafted and laid. The problem with the Negative Resolution procedure, as I understand it, is that it is up to Members of either House to pray against such resolutions; it is not up to the Government to find time for a debate, although of course if the pressure of Parliamentary business is slack the Government, of either Party, are usually reasonably accommodating.
Whether one uses the Negative or Affirmative Resolution procedure is a matter of individual examination, and I believe that the negative procedure should be used only when one is concerned with the nuts and bolts of the working of a Statute. These powers to make regulations go much further than this and in many ways Parliament is being asked to give the Secretary of State
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a blank cheque. Thus, the Affirmative Resolution procedure is the better way out. This Amendment would not delay the Bill because, as the noble Lord, Lord Wells-Pestell, said on Second Reading, and as was said in another place, consultations will take place with local authorities and other interested parties before the provisions of Clauses 2 and 3 come into effect.
Lord GORDON-WALKER: The Opposition often tries to turn the Negative Resolution procedure into the Affirmative Resolution procedure. I should be very surprised if, when the noble Earl is on this side of the Committee, he makes the same speech that he has been making, because Governments do not like this. They go on the general principle, which is well-established, that you have the Affirmative Resolution procedure only when there are major matters involved, and when it is absolutely essential that the Minister should make statements on his own volition. This is not, after all, a world-shaking Bill and, in that sense, is a minor Bill. It is still possible for the Minister to defend himself, and this Negative Resolution procedure permits adequate scrutiny by the Joint Committee on Statutory Instruments. If there is anything wrong in the procedure, it is found out. With the best will, this should be regarded as an exercise and not too seriously meant.
Lord de CLIFFORD: I should like to join my noble friend in support of his Amendment. I must confess that when we hear the discussions which go on about the Bills relating to guard dogs, animals and many other things, to be faced with an Instrument on which all that can be said is, "We will not have it, because we do not like a part of it", seems a little unfortunate. I fully appreciate what the noble Lord, Lord Gordon-Walker, says and I understand him. It is not a question of being in Opposition; I just do not like the procedure.
Earl COWLEY: I knew the noble Lord, Lord Gordon-Walker, would say that, because I heard the same arguments used by his noble friend during the Committee stage of the Lotteries Bill. In fact, the Committee there decided the other way. Although this Bill is a minor one, the regulations in it are very wide.

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The noble Lord will recognise that. They are not surrounded by the restrictions found in other similar legislation; Acts which have been mentioned tonight. In view of the accommodating attitude of the other side, I do not wish to press my Amendment. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 5 shall stand part of the Bill?
Lord de CLIFFORD: I do not wish to delay the Committee, but I should like to go back to the time factor again and the introduction of these regulations. During Second Reading it was said that due to the economic circumstances, lack of manpower, and one thing and another—things which we all accept—the moment to bring in such regulations has to be well chosen. I feel these should be brought in as quickly as possible. The local authorities are already licensing people in great numbers; they are licensing kennels under the Animal Boarding Establishments Act, and licensing kennels under the Breeding of Dogs Act. They license pet shops annually. They have the machinery already set up. Anybody whose premises has been inspected under the Animal Boarding Establishments Act or the Breeding of Dogs Act knows full well they have a visit from the vet., somebody from the environmental authority, the fire officer and, after that, when they have had a good look at it, somebody comes from the town and country planning department to say that they want the whole thing altered because there has been a change of use. That has all been happening. Would the Government please try to speed the introduction of this matter when we have tidied it up a little?
Lord WELLS-PESTELL: Of course we will. As we are going to meet, it may well be that between now and then—and I concede that we shall have to meet very quickly—we may be able to get some time-scale, although I can make no promises. Perhaps we can mention this as another matter when we get together.
Earl COWLEY: Regarding paragraph (d) of Clause 5(1) there is provision to extend the licence after the death of the licence holder. Could the noble Lord
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say whether the Government are considering putting a time limit on such an extension? Under former legislation, a time limit of three months was imposed.
Lord GORDON-WALKER: A licence can always be revoked if the successor is not behaving as well as his predecesor, but I do not know whether there should be an exact time. It cannot be more than a year, because the licence is an annual one.
Clause 5 agreed to.
Clause 6 [Interpretation]:
Lord de CLIFFORD Lord de CLIFFORD had given Notice of his intention to move Amendment No. 11:
Page 3, line 18, after ("used') insert ("primarily").
The noble Lord said: If it would be of assistance to the Committee and speed things up, I will not move Amendments Nos. 11 and 12 standing in my name. They can be included in the discussion that we have.
6.47 p.m.
Earl COWLEY Earl COWLEY moved Amendment No. 13:
Page 3, line 25, leave out from ("elsewhere") to end of line 26.
The noble Earl said: Under Clause 6 as drafted, the person who owns a dog and uses it to guard his home premises is not required to keep the animal in guard dog kennels. This is a failing of the Bill, because from the point of view of the person coming into the premises the risks are just the same, and where there is no provision for the private owner to be required to kennel his dog, he will also not be subject to any of the conditions that are imposed by the local authority in granting any licence. These conditions, if past legislation is anything to go by, will cover such things as the treatment of the animal and the conditions under which it is kept.
This Amendment seeks to alter what I believe to be an anomaly by removing from the Bill the words printed on the Marshalled List. There are obvious differences between the private owner who uses his own dog to guard his own premises, and the individual who has a pack of dogs which he hires out to guard other people's premises. But there is

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provision in Clause 5 to make regulations to take account of the differences. Under subsection (2)(a) there is power for the Secretary of State to make regulations for different cases and different circumstances. This is a shortcoming in the Bill; it is a point which should be looked at and it has been raised in another place.
Lord GORDON-WALKER: I do not think this is a defect in the Bill. There is a sharp distinction between the man who raises dogs for hiring out and the man who uses his own dog, and maybe keeps it in his own house, for guarding his own premises. Under Clause 1 he has to keep his dog under control, which is the main protection against doing damage to anybody. A person who uses his own dog is not going to make money out of it; he is not hiring out the dog. He is not in the least like the people we are trying to catch under the licensing and other provisions of this Bill. It will also impose an extra burden on local authorities. If several people kept the dogs in their homes the authorities would have to look in their homes, because that would be where the kennels would be. This part of the Bill is pursuing common sense, and there is a distinction which the noble Earl realises and recognises. Because it is a true distinction I think it ought to be recognised in the Bill in the way it is. I hope the noble Earl will see his way to withdrawing his Amendment.
Earl COWLEY: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 6 shall stand part of the Bill?
6.50 p.m.
Viscount MASSEREENE and FERRARD: If I might just mention a point which was raised by the noble Lord, Lord de Clifford, I hope that when these consultations take place between the parties the noble Lord will consider very carefully my noble friend's suggestion of the insertion of the word "primarily" after the word "used". It seems to me that the definition in this Bill of "guard dog" is rather wide. My own dogs all guard premises, but that is not their primary use. I should like to make that point, because I think the suggestion put
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forward by my noble friend was a very good one and I hope it will be taken into account when the consultations occur.
Lord GORDON-WALKER: I will look at it, but I doubt whether I shall agree about that one.
Lord de CLIFFORD: In order that your Lordships may have an idea of some of the subjects I should like to raise during these consultations, may I say that I find myself somewhat confused when we begin to link Clause 6 with all the other clauses. One thing which worries me is the question of kennels for guard dogs. Would the noble Lord consider the situation which arises when you have a firm which employs a number of handlers who take their dogs home? The dogs live inside the dwelling-house and not in a shed in the back garden. This happens, and the best examples of it are the police. But Securicor also do it, and so do a number of other people. These dogs are taken home by handlers, but the handlers do not own the dogs. They keep them in the house—perhaps they have a basket under the kitchen table: I do not know. Does that house then become a "guard dog kennel", requiring to be licensed? It is an interesting point, because I think it would be fascinating to see "Windy Ridge" and "Chez Nous" licensed as guard dog kennels.
Lord GORDON-WALKER: It would be impossible.
Lord de CLIFFORD: I feel this is something we should consider in connection with this matter. Also, I am not quite clear as to the position of the man I mentioned on Second Reading—though perhaps the noble Lord, Lord Gordon-Walker, may not have appreciated what I was trying to get at—who has a shed on an allotment. He does not use the dogs which he keeps there for guarding the allotment. They are there to guard his tools or any produce which he may keep in the shed. He lives elsewhere. A case of this kind did occur, the dogs biting their way out and attacking some children. When these people were asked why they did not keep their dogs more securely, they said: "It is the best we can do because we had them when they were small and then they were in the house, but now we just keep them in the

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shed." In fact, there was no doubt at all from the way these dogs behaved they were guard dogs. So this is a point on which I should like clarification at our discussions.
Lord GORDON-WALKER: We will look into it.
Clause 6 agreed to.
Remaining clause agreed to.
House resumed: Bill reported with the Amendment.
House adjourned at four minutes before seven o'clock.