Lords Sitting of 30 June 1977

Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Rochester):
The LORD CHANCELLOR On the Woolsack.

CIVIL AVIATION AUTHORITY AND THE GOVERNMENT
Baroness BURTON of COVENTRY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what is the relationship between themselves and the Civil Aviation Authority.
Lord ORAM: My Lords, the Civil Aviation Authority is a statutory public body and the statutory relationship between the Authority and Her Majesty's Government is that established by the Civil Aviation Act 1971. Part I of the Act defines the constitution and functions of the Authority and sets out the ways in which Her Majesty's Government may regulate the performance by the Authority of its functions.
Baroness BURTON of COVENTRY: My Lords, I spent this morning studying the Civil Aviation Act, and I am wondering whether the noble Lord will agree that in it we are told that the Government and the Authority work closely together wherever both international and domestic aspects of civil aviation are concerned. Arising out of that, and out of that cooperation, can the Minister clear up something which left me, anyway, in a muddle last week? Do the Government consider that they have the responsibility and the authority to make suggestions, though not to offer directives, to the Civil Aviation Authority?
Lord ORAM: My Lords, in addition to formal directives, my right honourable friend can offer guidance to the Authority,
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but Section 3 of the Act makes it quite clear that the guidance is to relate to really major matters of aviation policy and not small matters of day-to-day administration. Indeed, if he does offer such guidance it is only by the Authority of Resolutions of each House of Parliament.
Baroness BURTON of COVENTRY: My Lords, can the noble Lord tell me, arising out of that reply but considered from a slightly different angle, whether he recalls that, during the protracted discussions on the renegotiation of the Bermuda Agreement, it was said that if agreement was not reached United States' airlines would not be allowed to land in this country? On whose authority would such a decision be taken? Would it be that of the Government, or that of the Civil Aviation Authority? Or would it be the subject of this co-operation that I have already mentioned?
Lord ORAM: That, my Lords, I imagine would be a joint matter of consultation between the Government and the Civil Aviation Authority. Certainly, it is the Government who would take final decisions in such a broad matter, but the matter which my noble friend pursues in her series of Questions does not rank with that in any way.
Lord BRUCE of DONINGTON: My Lords, will my noble friend reaffirm his own right honourable friend's ministerial political responsibility as a Minister for these matters regardless, if necessary, of the advice that he may receive from his permanent civil servants?
Lord ORAM: My Lords, my right honourable friend can only act within the law, and the law is the Civil Aviation Act 1971. His powers of direction relate only to situations in time of war, whether actual or imminent, and he deals with matters of national security and the fulfilment of this country's international obligations. It is in that order of business that my right honourable friend is able to exercise his authority.
Baroness BURTON of COVENTRY: My Lords, may I ask one further question? As the Government accept from the Civil Aviation Authority and the airlines that the practice of overbooking is to

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continue—an opinion which he knows I do not share—may I ask the noble Lord, unless he regards it as too small a matter in view of what he said previously, whether the Government are actually taking the stand that, although they consider that overbooking should be allowed to continue, they do not agree that air travellers should be given the facts when they buy their tickets and before they take their flights?
Lord ORAM: My Lords, if I may say so, my noble friend leaves the impression that the whole problem of overbooking is as it was a year or 18 months ago. That is very far from the case. We have a voluntary scheme of compensation which is now operated by 27 overseas airlines and 10 United Kingdom airlines. The question of the return ticket is now being pursued in the European Civil Aviation Conference. It is difficult to quantify these matters, but, in my estimation, the problem has been 99 per cent. met. There is the continuing problem of the degree of publicity for the compensation scheme and, on this, Her Majesty's Government accept the view of the Civil Aviation Authority.

WORK PERMITS: HOTEL AND CATERING
3.6 p.m.
Lord GISBOROUGH: 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 work permits have been issued to persons from overseas for employment in the hotel and catering industry in 1977.
Lord WALLACE of COSLANY: My Lords, available figures for hotel and catering exclude workers in hostels and industrial catering. These figures show that in the five months to the end of May just over 900 permits had been issued.
Lord GISBOROUGH: My Lords, I thank the noble Lord for his Answer. In view of the number of vacancies for
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trained and trainable staff in the Provinces for people who are prepared to work in catering, and the high home unemployment in those same areas, will the Minister consider what can be done to encourage British youth to enter the trade? May I further ask what training schemes exist?
Lord WALLACE of COSLANY: My Lords, without detailed figures at hand, I can say that a considerable number of training schemes exist in various areas. The industry is endeavouring to encourage people to enter into the hotel and catering trades. The Government are concerned about the future of the quota, which was introduced in 1972 by the Conservative Administration. In view of the persistent high level of unemployment, Ministers intend that these special arrangements should be phased out. The quota is reviewed annually, and talks with representatives of the unions, employers, and manpower services about a quota for 1978 are expected to take place later in the year. In the meantime, I agree with the noble Lord that every effort should be made to encourage people to enter training, but in the past one of the problems for the non-skilled section has been the extremely low wages paid. This is a matter for concern. For the skilled workers it is a different matter. Adequate schemes exist and probably need more publicity.
Lord LEE of NEWTON: My Lords, before work permits are issued, do the Government make quite sure that the jobs for which people are coming here will be remunerated at the proper trade union rates of pay?
Lord WALLACE of COSLANY: Yes, my Lords, they do. But there are probably some instances, of course, where official rates may not be observed. This is a matter for investigation to be carried out and reported on where such cases exist. The problem is to obtain factual proof.
Lord AVEBURY: My Lords, surely the Minister must be aware that many of these workers are not paid anything like minimum trade union rates. Would he confirm that the vast majority of the 900 permits to which he referred in his first Answer were issued to non-EEC foreign nationals, and that very few permits are

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given to Commonwealth citizens? The fact that so many work permits are being issued to foreigners and so few to Commonwealth citizens shows that there is racism in our immigration laws.
Lord WALLACE of COSLANY: My Lords, there is some confusion here, because the noble Lord is probably well aware that special quotas exist to help the citizens of Malta, the Dependent Territories, and United Kingdom passport holders. So far as the low level of wages is concerned, this is a matter for some investigation. I shall pass on the remarks of both noble Lords to my right honourable friend.
Lord AVEBURY: My Lords, the Minister did not answer my question. How many of these 900 work permits in the hotel and catering industry were issued to non-EEC foreigners? I did not ask about the Maltese. If the noble Lord does not have this information will he make inquiries and let the House have the information?
Lord WALLACE of COSLANY: I have the answer, my Lords: 870 out of the 900.
Lord GRAY: My Lords, would the Government not agree that, at a time when steps have been taken to strengthen the law relating to food hygiene, the availability of trained staff is very relevant and that sometimes it is the inability of management to obtain trained staff interested in doing a good job that leads to hygiene conditions which are unsatisfactory?
Lord WALLACE of COSLANY: Yes, my Lords, and this is primarily a matter for the industry concerned. The noble Lord has probably seen recently Press reports and photographs of the "dirty mouse" giving an active portrayal of what can happen to people who do not understand English but who apparently understand the antics of a trained dirty mouse.
Lord SUDELEY: My Lords, can the country afford a situation where the hotel industry is short of skilled staff yet at the same time British people can prefer to remain unemployed rather than train for vacancies in the industry?
Lord WALLACE of COSLANY: My Lords, my impression is contrary to that of the noble Lord. People do not prefer to remain unemployed. The view which the noble Lord expressed is a mistaken attitude of mind which unfortunately too many people have. The problem is to provide increased facilities for training and for all sections of the industry to give increased co-operation. Not all the employers are large. There are some extensive schemes of training and in some areas there are excellent schemes. For example, the City College in Norwich has an excellent reputation for turning out trained staff. But in some areas the facilities are not what they should be, and that is a matter we should look into.
Lord GISBOROUGH: My Lords, I hope the Minister will not tar the industry with the brush of low wages. Is he aware that, while of course there will always be exceptions, some extremely high wages are paid?
Lord WALLACE of COSLANY: My Lords, one is of course using comprehensive terms about the industry. There are some small sections about which one can be somewhat dubious in regard to their low rates, but the general standard of the bigger sections, the well-known chains of hotels and so on, is a different matter; they have agreements with trade unions and these are effective. It is the smaller organisations, some of them Continental, which are suspect.
Baroness FAITHFULL: My Lords, would the noble Lord agree that there is not a proper career structure between the low paid and the untrained working towards training, so that in the catering trade there are two separate categories of worker, with no link between the two, and no career structure?
Lord WALLACE of COSLANY: My Lords, the noble Baroness, Lady Faithfull, is quite right. That was one of the matters dealt with in a Statement made in another place yesterday by my right honourable friend, which unfortunately was not repeated in this House. The emphasis of that scheme is to give training to unskilled workers to give them better employment opportunities.

NEW PALACE YARD: CATALPA TREES
3.13 p.m.
Lord O'NEILL of the MAINE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are aware of the condition of the catalpa trees in New Palace Yard; and what they intend to do to save these trees from possible death.
The PARLIAMENTARY UNDERSECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Baroness Birk): My Lords, these splendid old trees now in leaf are well past their normal life-span. The construction of the underground car park and last year's drought affected them badly. Unfortunately, nothing can be done to rejuvenate them and, if deterioration continues, replacement is the only answer.
Lord O'NEILL of the MAINE: I hope the Government will accept advice on this matter, my Lords. Are the Government quite sure that these fine trees are condemned to death because of the building of this expensive car park and the unfortunate drought which followed it? I hope the Government will make every effort to save some of the finest examples in this country of the Indian bean tree.
Baroness BIRK: My Lords, I assure the noble Lord that he is pushing at a very open door. At the time when the plans were put forward for the construction of the underground car park it was certainly the view of my Department that the trees should if possible be saved, and in fact they were. We get advice from the Advisory Committee on Forestry. It is now simply a question of whether the trees deteriorate even more. There is also the fact that tree surgery must be carried out frequently because of the danger of a branch knocking off the odd MP now and then—
Several noble Lords: Shame!
Baroness BIRK:—and that must be taken into account as well. However, I can assure the noble Lord that personally I would do anything to save any tree.
Lord DAVIES of LEEK: My Lords, is my noble friend aware that, despite the fact they may knock off the odd MP now and then, some of us have great affection for these catalpa trees and would like to know whether dendrologists were approached for advice before the underground labour was undertaken? Is she further aware that we believe that these trees could still be saved if first-class advice from dendrologists was obtained?
Baroness BIRK: My Lords, we get absolutely first-class and expert advice from the Advisory Committee on Forestry. As my noble friend knows, the plan was agreed by another place for the reconstruction and landscaping, and a decision was taken to keep the old trees. Nevertheless, the change in the water level due to the work that had to be undertaken must have some effect on them. The trees are now about 110 years old and their normal life-span is 80, so really nature is taking its course.
The Marquess of ABERDEEN and TEMAIR: My Lords, is the noble Baroness aware—of course she is, and I apologise for wandering so far to the left of my normally independent posture—that the catalpa tree, the Indian bean tree, is of United States origin and that, if these trees have to go, it would be the very greatest pity if they are not replaced?
Baroness BIRK: My Lords, three new catalpas have been planted alongside them, and I assure the noble Marquess that if they have to go there is simply no question of their not being replaced.
Viscount BARRINGTON: My Lords, may I ask the Minister to say how many MPs are equal to one Indian bean tree, whether it is a live bean tree or a has-been tree?
Baroness BIRK: The noble Viscount must work that out for himself, my Lords.

GOVERNMENT STATEMENTS
3.17 p.m.
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, with the leave of the House, at a convenient moment

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after 3.30 p.m. my noble friend the Leader of the House will repeat a Statement on the European Council meeting, and this will be followed by my noble and learned friend the Lord Chancellor repeating a Statement on the Grunwick dispute.

TRANSPORT (FINANCIAL PROVISIONS) BILL
Read a, and passed.
REDUNDANCY REBATES BILL
Read 3a with the Amendments, and passed, and returned to the Commons.

MINIBUS BILL
Baroness YOUNG: My Lords, I understand that no Amendments have been set down to this Bill and that no noble Lord has indicated a wish to move a manuscript Amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the Order of Commitment be discharged.
Moved, That the Order of Commitment be discharged.—(Baroness Young.)
On Question, Motion agreed to.

PRICE COMMISSION BILL
3.19 p.m.
Lord ORAM: My Lords, I beg to move that this Bill be now read a second time. While much may be said about this Bill, I trust that no one will seek to argue that it has not received the fullest possible debate before its introduction into your Lordships' House. No doubt this House will wish to ensure that the Bill is thoroughly debated here, but perhaps I might express the hope that in considering the Bill, your Lordships will not seek to emulate the record-breaking attempts witnessed last week in another place.
The basic purpose of this Bill is to provide new power to replace the current price control legislation which expires on 31st July. That legislation is to be found in the Counter-Inflation Act 1973,
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the Prices Act 1974, and the Remuneration, Charges and Grants Act 1975. The present system of controls is based on a Price Code which is subject to approval by both Houses of Parliament. The Price Commission is the interpreter of the Code and examines prices to see whether they comply with its terms. Except as a matter of law, there is no appeal from the Commission's decisions, subject to the ability of the Secretary of State to consent to matters which would otherwise be prohibited by the Code.
While the Code is a valuable weapon in the war against inflation, the present system has a number of defects. It is based on two elements, allowable costs and profit margin controls. The former permit a firm to pass on to the consumer virtually all increases in its costs and do not permit any investigation into questions of efficiency. The profit margin controls are based on levels of profitability which prevailed when price controls were first introduced. A firm's net profit margin reference level may be above or below the average for that sector, and this may work to the firm's unfair advantage or detriment.
The proposals put forward in this Bill contain a different approach. The Price Code will be retained, but on a limited and temporary basis. The power to impose cost controls will be repealed with only the margin controls remaining. Moreover, the power to enforce a Code will disappear completely after 31st July 1978, unless further legislation is introduced in the meanwhile.
The main feature of the new system will be selective investigations of price increases carried out by a strengthened and expanded Price Commission. As at present, the larger manufacturing and service firms will have to give the Price Commission 28 days' notice of their intention to raise prices. The Commission will consider these pre-notifications and the information supplied with them. If it considers that the reason for the increase requires further scrutiny, it will mount an investigation during which the price may be partially, or completely, frozen. When the Commission has completed its investigation, it will submit a report to the Secretary of State, who may make an order freezing the increase for up to 12 months from the date of pre-notification.

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The Government attach importance to making the investigatory system permanent. It has been argued that this feature of the Bill is undesirable, except possibly as a temporary anti-inflationary device. However, this argument ignores the nature of the new powers. Unlike the margin controls, which are to be temporary, which apply across the board and which are tied to pay policy, the investigatory powers will be selective. They will enable the Commission to carry out an in-depth survey of the reasons for individual price increases and, on the basis of generalised criteria, to see whether these are justified. The Commission will be able to form a view as to whether costs are being incurred unnecessarily, or whether a company is abusing a dominant market position.
While most of the Price Commission's investigations are likely to be in areas where competition is limited, it would be wrong to confine the new powers to the statutory monopoly situations within the meaning of the Fair Trading Act 1973. There are many areas outside the field of pure monopoly where competition is far from perfect. Price leadership and parallel pricing are common, and it should be recalled that about 40 per cent. of net manufacturing output is concentrated in the top 100 firms.
The Government consider that there is a case for an eventual amalgamation of the Price Commission and the Monopolies and Mergers Commission. However, as was explained by my right honourable friend the Secretary of State during the debate on Report in another place, many policy and legal issues remain to be resolved before such legislation can be introduced. Meanwhile, the Government consider the present Bill represents the best means of establishing an effective prices policy.
I should stress very firmly that industry is unlikely to suffer as a result of the new system. Criticism has been levelled at the proposed powers to freeze prices during investigations. However, it is the Government's view that the absence of such powers would he totally unfair to consumers who had paid prices later held by the Commission to be unjustified. Firms under investigation will, moreover, be protected in a number of ways. Their
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protection will lie in the independence and good sense of the Commission, the new Chairman and Deputy Chairmen of which were announced last week. They will be protected from unnecessary investigation by the inability of the Commission to mount more than about 40 investigations a year—a small percentage of all increases notified.
Finally, there will be the safeguards regulations. Under Clause 9 of the Bill, the Secretary of State will be required to make regulations prescribing minimum levels of profitability which firms ate not to be prevented from earning as a result of investigations and examinations. A firm whose profits fall within the safeguard limits will thus be entitled to an interim price increase during an investigation as of right, and the Commission will also be free to permit it further increases over and above the safeguards level.
The Bill is admittedly complex in parts. This is perhaps inevitable, especially because it amends the Counter-Inflation Act 1973, which has already undergone substantial amendment. It is hoped to introduce a Consolidation Bill very shortly. However, it might be of assistance to your Lordships if I explain some of the more important of the various clauses.
The first clause deals with the constitution of the Price Commission. The Commission is to continue in being as a body corporate subject to the provisions of the Bill. The requirement for members of the Commission to be appointed, jointly by the Minister of Agriculture, Fisheries and Food, as well as by the Secretary of State, is deleted. This reflects the fact that when the Counter-Inflation Act was enacted, there was no Secretary of State for Prices, and appointments were made jointly by the Secretary of State for Trade and Industry, and the Minister of Agriculture, Fisheries and Food. The creation of the Department of Prices and Consumer Protection removes the need for such joint appointments.
In conjunction with Schedule 1, Clause 1 provides for investigations and examinations to be carried out by a group consisting of not less than three members of the Commission. However, as a result of an Amendment made to the Bill before its introduction into your Lordships' House, reports must now be made

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by the Commission. A group's conclusions will have no legal effect unless endorsed by the Commission as a whole. Finally, the clause contains a declaratory provision stating that the Commission is not to be regarded as an agent of the Crown. While this is not part of the Bill itself, I think it is relevant to consideration of Clause 1 to mention that an order will shortly be made by the Secretary of State increasing the maximum size of the Commission from 12 to 16. This will assist the Commission in the performance of its new investigative role, and enable it to reflect the widest possible range of experience.
Clause 2 contains the fundamental criteria which are to guide the Commission and the Secretary of State in performing their functions under the Bill. The Commission is required to have regard to all matters which appear to it, in the particular circumstances, to be relevant, with a view to restraining prices of goods and charges for services in so far as that appears to the Commission to be consistent with the making of adequate profits by efficient suppliers of goods and services. However, the Commission is also required to have particular regard to eight specified criteria. These criteria, to be found in subsection (2) of Clause 2, are not to he regarded as a substitute for the Price Code. The Commission does not have to take them all into account if it considers that certain items are not relevant to the case under consideration. Moreover, provided that it considers them relevant, the Commission can take into account other factors which do not feature in the list of criteria. But the criteria are the basic guidelines to which the Commission and the Secretary of State must have regard, and firms will be able to pray them in aid in justifying proposed price increases.
Clause 3 deals with the Commission's general reports to the Secretary of State. As originally drafted, the Bill provided that the Commission need make only an annual report. However, Amendments made in another place provide for retention of the current practice of quarterly reports.
Clauses 4 to 8 deal with the conduct of investigations, the preparation of reports by the Commission and the subsequent making of orders by the
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Secretary of State. Clause 4 deals with firms subject to the requirement to prenotify price increases. Basically, these are the larger manufacturing and service firms. If the Commission wishes to investigate a proposed increase, it must serve a notification on the Secretary of State and the firm within the 28 days following pre-notification of the proposed price increase. The Secretary of State will have the right to order that an investigation be discontinued at any time, although such a veto will be exercised only in the most exceptional circumstances. During the investigation, the price increase may be frozen, but the Commission may award an interim price increase of any amount. The Commission will be obliged to award such an increase as the firm is entitled to obtain under the safeguards regulations. Clause 5 deals with the investigation of the prices of non-prenotifying manufacturing and service firms and of the margins of distributors. The procedure is similar to that set out in Clause 4, but, as there is no pre-notification, it is the existing price rather than a proposed price increase which is investigated. Moreover, distributors' margins may not be frozen during an investigation.
Clause 6 specifies the manner in which an investigation is to be conducted. Essentially, all investigations must be concluded within three months. A firm subject to investigation is allowed to demand a public inquiry if it so wishes, but such an inquiry may not be forced on the firm against its will. Certain restrictions are imposed on the recommendations which may be contained in the Commission's report. The Commission may not recommend that a price increase be restricted to a greater degree than is permitted under the safeguards regulations, nor may it recommend an increase of less amount than an interim price increase already awarded to the firm. The restriction recommended may not be of more than 12 months' duration, calculated from the date of pre-notification in the case of an investigation under Clause 4 and from the start of the investigation in the case of proceedings under Clause 5.
Clauses 7 and 8 deal with undertakings given and orders made following an investigation. The Price Commission's

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recommendations are to have automatic effect for 28 days following delivery of the report. The Secretary of State may accept an undertaking from the firm at any time, or he may make an order in the last two weeks of the 28-day period. Such orders are subject to annulment by Resolution of either House of Parliament, and they may not impose restrictions more onerous than those recommended by the Price Commission. Where an undertaking is broken, the Secretary of State's order-making powers are brought into play once more. Clause 9 requires the Secretary of State to make safeguards regulations defining profits which firms are not to be prevented from earning as a result of investigations or examinations. The Consultative Document containing an outline of the Government's proposals was published on the 15th June, and draft regulations will be published next week.
Clauses 10 to 13 deal with sectoral examinations. The Secretary of State already has power, under Schedule 1 to the Counter-Inflation Act 1973, to refer to the Price Commission general matters relating to prices and charges. The main innovation introduced by the Bill is that the Secretary of State will now have power to make orders giving effect to the Commission's recommendations. The new powers are naturally hedged about with suitable safeguards. The Secretary of State will not be able to refer an individual firm to the Commission unless it is in a monopoly position. Individual investigations may be initiated only by the Commission. Moreover, where an order following an examination is to be of more Wan 12 months' duration, it will be subject to approval by Resolution of each House of Parliament, rather than to annulment. Under the sectoral examinations provisions, the Secretary of State will be given the specific power to refer to the Commission practices involving recommended retail prices, and to make orders in consequence of the Commission's recommendations.
Clause 14 gives permanent force to various provisions of the Counter-Inflation Act 1973. They are the power to require the pre-notification of price increases, to enforce the Commission's decisions, and to obtain information. They are all a necessary part of the investigatory system.
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The powers of the Secretary of State for Trade to control insurance premiums are also made permanent.
Clause 15 provides that future Price Codes may not contain cost controls. Industry will naturally be consulted on the new Code to take effect after 31st July and a Consultative Document will be published next week. The clause also renews the provisions of the Remuneration Charges and Grants Act 1975 which permit the Code to contain a pay sanction and extends that to the new investigatory system. Clause 16 extends the powers of the Secretary of State in the field of price display. In particular, it extends these powers to all goods which a retailer indicates are for sale, or may be for sale, and it brings within control the display of prices for the provision of services to a consumer in his private capacity.
Clause 17 renews until 31st July 1978 certain of the provisions of the Remuneration Charges and Grants Act 1975 which support a pay policy. These pay provisions have no effect unless a White Paper has been published and approved by both Houses of Parliament. The clause also extends until 31st July 1978 the power to enforce a Price Code.
Clause 18 places on a permanent statutory basis the power of the Secretary of State to make grants to local authorities and other bodies in respect of local price surveys and the provision of advice to consumers. Clause 19 requires the Price Commission to give the Director General of Fair Trading information about any unregistered restrictive trade agreement which comes to light in the course of its investigations. It also gives the Secretary of State the right to transfer to the Price Commission the task of supervising orders and undertakings arising from an investigation by the Monopolies and Mergers Commission. The remaining clauses, Clauses 20 to 24, and the second and third Schedules are largely technical.
My Lords, the Bill is an important measure. The Government do not pretend that it will provide a panacea for controlling inflation. The cure for that ill lies in a wider range of policies, including the control of public expenditure and the maintenance of an effective voluntary wage policy. However, by enabling effective action to be taken in areas where market forces do not serve as an adequate

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restraint on prices, the Bill will play an important dual role both in restraining prices and in improving competition policy. As such, it will be of benefit to every inhabitant of this country. I commend the Bill to Your Lordships and beg to move that it be read a second time.
Moved, That the Bill be now read 2a—(Lord Oram.)

EUROPEAN COUNCIL MEETING
3.44 p.m.
The LORD PRIVY SEAL (Lord Peart): My Lords, with the leave of the House, I will now repeat a Statement being made in another place by my right honourable friend the Prime Minister. The Statement is as follows:
"With permission I should like to make a short Statement on the meeting which concluded at lunch-time today of the European Council. Two Statements have been issued on growth, inflation and unemployment and on the Middle East and both have been placed in the Library of the House.
"The European Council reviewed economic developments since our meeting in Rome and recognised the need for a sustained expansion of world economic activity consistent with a further reduction of the rate of inflation and of unemployment.
"Unemployment was a leading theme of our discussions, particularly employment of young people and of women and I was able to report to the other Heads of Government details of the Youth Opportunities Programme which was announced to the House yesterday by my right honourable friend the Secretary of State for Employment. This initiative was very much welcomed.
"Following the last European Council I wrote to the Chairman of the Governors of the European Investment Bank asking for proposals from the Bank to promote investment and employment. I reported to the Council that in reply the Chairman has given a positive indication of an immediate expansion in the Bank's activities which could lead to lending within the Community of about £750 million in 1977 and £1 billion in 1978.
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"Members of the Council emphasised the importance of the commitments made by some Heads of Government to the achievement of specific growth targets in 1977 and emphasised the need to promote stability and to seek expansion through export-led growth.
"We invited the Commission to study certain sectors of industries in our countries which are adversely affected by structural changes in the economy whilst adhering to the view that a liberal commercial policy was in the best interests of the Community and of the world as a whole.
"I was able to bring other Heads of Government up to date on the passage of events in Southern Africa, including an account of the discussions at the Commonwealth Heads of Government Meeting. It was agreed that the situation is growing in seriousness and the Foreign Ministers will continue to exchange views in order to achieve a concerted policy.
"There was a useful exchange of views on East/West relations and President Giscard reported on the recent visit to Paris of President Brezhnev.
"The Statement on the Middle East affirmed that all aspects of Security Council Resolutions 242 and 338 must be taken into account and our Statement reflects the leading role which the United States has in promoting negotiations for a peace settlement. It was nevertheless the view of the Heads of Government that a Statement by the Nine at this stage would make clear our view of the need for progress in further negotiations.
"This was a useful but not dramatic meeting which enabled us to review existing policies and where necessary to adapt them to a changing situation".
My Lords, that concludes the Statement.
3.49 p.m.
Baroness ELLES: My Lords, I should like to express on behalf of my noble friends our thanks to the noble Lord the Leader of the House for having repeated this Statement. Having said that, I think it a remarkably unhelpful Statement and perhaps it is more remarkable for what it does not say than for what it does say. First, we are told that

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two Statements have been put into the Library of the House, so that at the moment we are not able to discuss them, although the full text of the Statement on the Middle East has been published in today's Press.
Secondly, I should like to draw to the attention of the noble Lord—and perhaps he will make some comment when he comes to reply—that there is nothing in this Statement referring to the siting of the JET at Culham. I understand, again entirely from the Press, that this was a major matter for discussion among the Prime Ministers of the Nine. One quite accepts that they may not have come to a satisfactory conclusion and, indeed, everybody accepts that it is a difficult problem for us and for other members of the Community. But I think that one is permitted to believe that it is extraordinary in matters of this kind that this particular matter has not been reported to the House.
I should like also to make a comment on the question of the renewed economic activity which was hoped for for Western Europe, bearing in mind that Ireland, Italy and ourselves have by far the largest inflation rates; and that combating inflation in countries like Belgium and Germany—and I understand that the rate of inflation per annum in Germany is 3·8 per cent.—cannot be of such major concern as it is to our own country.
Another point that I should like to raise is the question of loans from the European Investment Bank. I hope that during these discussions, and the programme that follows, considerably more loans from the Investment Bank will go to the private sector of industry in this country rather than the nationalised industries, as last year about 75 per cent. went to nationalised industries and only the remainder to the private sector.
Regarding the programme for reducing unemployment, I am certain that all noble Lords will welcome any positive policies which are going to help in the reduction of unemployment, and particularly in the field of youth unemployment. Again, it was surprising that in the Press there was very much emphasis on the fact that assistance would come from the European Social Fund in order
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to help this programme along. It is also surprising therefore that that was not included in a statement which is concerned with a meeting of the European Council of Ministers.
In conclusion, it is clear that a great many matters were discussed at the Council of Ministers' meeting this time. I am grateful to the noble Lord for having read a Statement which does not make us very much wiser. It is regrettable that the last Council of Ministers' meeting which took place in this country under the Presidency of the United Kingdom should be rather uninspiring.
3.52 p.m.
Lord GLADWYN: My Lords, we on these Benches would likewise like to thank the Minister for repeating this Statement. So far as it goes, it seems to be virtually unexceptionable. We can all agree with the proposals for increasing the promotion of investment by the European Investment Bank. We gather from the final paragraph that it was a useful but not dramatic meeting. Does that mean that if, by any chance, any decision had been taken, it would have been dramatic? But so far as I can understand it, no decision was taken.
More especially—if we can judge from the Press—no decision was taken on the matter which has been outstanding now for a year or two: namely, the Joint European Torus Scheme. That is wholly deplorable. Is the Minister able to tell us why it is impossible to get a decision at long last? And if a decision cannot be taken by the European Council, by whom can it ever be taken? I suggest it is no good referring it back to the Foreign Ministers—they cannot take decisions if the Prime Ministers cannot. Indeed, if I may be allowed to say so, this meeting was more in the nature of an amicable fireside chat, doing no harm but no particular good. Whether it was worth while assembling these Heads of State from all over the Community in order to arrive at no decisions is anybody's guess.
There is another Statement which I understand we have not seen, on Palestine. We gather from the Press that the Council came out strongly in favour of the eventual constitution of a Palestinian State. I do not know whether that is so: perhaps the Minister will be able to tell us. But, if

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that is so, is the Minister in a position to say whether, in the opinion of the Government, they should not proceed in the direction of the constitution of a Palestinian State until such time as all the Arab States have freely admitted that the State of Israel is a sovereign State which will continue to be in existence, and whose sovereignty and integrity will not be prejudiced, whatever the eventual agreement on boundaries may be?
3.56 p.m.
Lord PEART: My Lords, I was rather surprised that the noble Baroness said that the Statement was unhelpful; I cannot be blamed for that, in any case. After all, when you have had a series of meetings and discussions at a high level you cannot cover in a Statement everything that has happened. A Statement obviously must be relatively brief. The complaint that I have usually had has been that Ministers, when making Statements, are too long and tedious. I welcome receiving a shorter and briefer contribution.
I was asked specifically about JET. I take an interest in that and this matter was raised earlier. This issue has been discussed. As noble Lords know, the main problem has been the choice of site. There are problems if the design team at Culham is to be kept in being, and I believe that a decision is urgent. That is the view of the Prime Minister. It has been agreed that Foreign Ministers should meet before the end of July in order to reach agreement on this issue. The next meeting of the Foreign Affairs Council is on 26th July. Noble Lords know that the question is whether the site should be at Culham or Garching. There have been difficulties over this. It is the view of the United Kingdom that a decision on the site should be taken on the merits of the case. We believe that we have a good case. That is important.
Baroness ELLES: My Lords, would the noble Lord allow me to intervene? I wondered if there was any truth in the newspaper statement that the offer of a site at Culham was connected with budget contributions. Was this just a newspaper red herring?
Lord PEART: I think so. As I have said, my Lords, it is our view that the site should be at Culham. We have a long
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tradition of plasma physics research there. Noble Lords have taken an interest in that, especially the noble and learned Lord, Lord Hailsham of Saint Marylebone; he was once responsible for science and, I know, took a great interest in that. We are anxious to have the site at Culham; we believe that we can make a major contribution. That is not anti-European or anti-German in any way. We feel that we have a lot to offer in this direction.
The noble Baroness, quite rightly, mentioned about new economic activity. She pointed out the problems of inflation which hit us of course. She quite rightly compared us with Germany. This is a problem that we have to conquer here. Mention was made of the European Investment Bank, and whether more loans will go to the private sector rather than the nationalised industries. I cannot give a specific assurance on this; but I will certainly convey the point to Ministers who are responsible. I want investment to be achieved—especially as we have a mixed economy—in the private sector as well as the public sector. I do not think there should be any rivalry here.
I was asked also about the programme for reducing unemployment. Of course this was the theme that was developed by the Prime Minister. He felt that, because we have problems peculiar to our own country—urgent problems affecting our young people—this should be a major theme in Europe. This was taken up and I am sure that much will come out of the Community on this aspect as policies work out in the future.
The noble Lord, Lord Gladwyn, asked one or two questions. He thought that the meeting was more like a fireside chat, a cosy chat. I would rather have that than some of the conferences that I have seen with other people representing our country at larger organisations in the United Nations. He will know, as a former ambassador, that often conferences which highlight things where there is controversy do not produce results. It is not a bad idea that sometimes our leaders can have cosy chats. I am sure that behind the scenes there were hard debates. I do not see why there should be this criticism of what has emerged from the Community. Some useful work has been done. Indeed, the noble Lord, lord

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Gladwyn, said this. The work was not dramatic; nevertheless, something has been done.
I was asked specifically about Palestine. A Statement is available in the Library. The emphasis is that we believe—and we have said this over and over again—that it would be a mistake to comb the Statement for novelty. Our purpose is to make clear our view of the need for progress towards negotiations which might lead to an ending of the tragic conflict in the Middle East and our support for efforts being made to bring this about. I will not quote from the Statement—it is rather lengthy—but we recognise the sovereignty of Israel. We also recognise that there is a problem which affects the Arab community as well. When noble Lords have read that Statement I think they will be satisfied.
The Earl of BESSBOROUGH: My Lords, I wonder whether the Leader of the House would answer this question. He spoke of East-West relations being discussed with particular reference to Mr.Brezhnev's visit to Paris. Could he say whether there was any mention of relations with the Chinese People's Republic, in view of the fact that a European Commission delegation is proceeding there at this moment? Does he know the terms of reference of this delegation?
Lord PEART: My Lords, I am sorry, but I do not know. When I leave the Chamber I will certainly try to get the terms for the noble Earl. Whether or not matters affecting China or relations with China were discussed, I cannot say. It was not in the Statement or the documents to which I have had access.
Lord GEORGE-BROWN: My Lords, so far as I understand the Statement on the Middle East which the Nine have produced at the end of this conference, I think most of us would be very pleased with it and I only regret that they did not do it rather sooner. Since we in Britain took the initiative which produced Resolution 242 which is to be the basis of the peace talks and the discussions going on, may I ask the noble Lord why, according to the newspapers, should we seem to allow France to claim credit for it. Why do we not speak more loudly
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of the part that Britain has played? was very glad that the noble Lord did not fall into the trap so artfully set for him by the noble Lord, the ex-diplomat, on the other side. It would be disastrous if we started trying to decide which of the steps should be taken and in what order. Resolution 242 has lasted for a decade and is now the basis for peace talks, simply because it took care to be even-handed on that matter.
Lord PEART: My Lords, I am most grateful for the remarks of my noble friend Lord George-Brown, a former Foreign Secretary and distinguished politician who has been pre-occupied with Middle East affairs. I would accept that Press comments give the impression that France was the only country that had taken the initiative and it ought to be stressed that we, the British, have played a major part. This is an all-Party issue, and I am sure the House would accept that.
Lord JANNER: My Lords, after having listened to what my noble friend has just said, is it not rather difficult to understand why at this particular time, instead of emphasising the resolution which has been explained and made clear on so many occasions, and instead of appearing to deviate from that and from Resolution 338, consideration should have been given to the past timing of the Statement? Does he realise that there are a very large number of people like myself who are very disturbed by the report which appeared in the Press and which we feel will give encouragement to those who are determined to destroy Israel? Would my noble friend make it clear that Resolutions 242 and 338 stand, and that there is no question of anything additional to them?
Lord PEART: My Lords, I will give that assurance. Indeed, if my noble friend reads carefully the Statement which is in the Library he will see that it sets out that the Nine have stated on many occasions in the past, for example, on the 6th November 1973, 28th September 1976, and 7th December 1976, their view that a peace settlement should be based on Security Council Resolutions 242 and 338, and if I may repeat, on the inadmissibility of the acquisition of territory by force; the need for Isreal to end territorial

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occupation which it has maintained since the conflict of 1967; respect for the sovereignty, territorial integrity and independence of every State in the area—and I could go on repeating. I hope my noble friend will read that Statement. I have the two resolutions here from which it will be seen that there is no contradiction. We stand by our original policy.
Lord PAGET of NORTHAMPTON: My Lords, I am very much obliged to my noble friend. The Foreign Minister is much to be congratulated on having left the main responsibility for this somewhat ignoble and oil-serving Statement to the French.
Lord PEART: My Lords, I cannot agree with remarks like that.
Lord JANNER: My Lords, I should like my noble friend to realise that none of us has yet had an opportunity of seeing the Statement. I was speaking about the statements which were made in the Press. It is important that the opponents of Isreal should not take advantage of any interpretation they put upon what has been said and given as a true report in the Press, which indicates that we are deviating in the slightest way from Resolutions 242 and 338.
Lord PEART: My Lords, my noble friend has long experience as a politician. He knows the Press and that one cannot always accept what is said there. You have to make your own judgment when you have read the Statement in the Library.

GRUNWICK LIMITED: DISPUTED
4.6 p.m.
The LORD CHANCELLOR (Lord Elwyn-Jones): My Lords, the Statement being made in another place by my right honourable friend the Secretary of State for Employment is as follows:
"With your permission, Mr. Speaker, I should like to make a statement about the dispute at Grunwick Processing Laboratories Limited.
"During the past week or so I have had a number of meetings with the parties concerned. I have discussed the situation with the Managing Director
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of the company, Mr.Ward, and his advisers; and with the General Secretary of APEX, Mr.Grantham. I have attempted to explore with both sides how sufficient progress might be made towards resolving the issues in dispute and to defuse the explosive situations which exist on the picket line and elsewhere. These escalating troubles must be laid to rest before they do more damage.
"During the course of the discussions I considered very hard in what way progress might best be made. I formed the conclusion that, if the parties were able to give me certain assurances, I should appoint an independent mediator to investigate the circumstances of the dispute, to make recommendations to the parties, and to report to me. I wrote to Mr. Ward and Mr. Grantham last Friday to say that I would appoint a mediator if they would agree to co-operate with him and abide by his recommendations. The union was prepared to give me these assurances, but despite long discussions I have been unable to persuade Mr. Ward and his advisers to agree to abide by a mediator's recommendations.
"In view of this I have come to the conclusion, very regretfully, that the appointment of a mediator would not bring about any early progress. The Government have been considering what further steps might be taken, since it is clear that matters cannot be allowed to go on like this.
"I have, therefore, today appointed a Court of Inquiry under the Industrial Courts Act 1919. Its terms of reference are:—
'To inquire into the causes and circumstances of, and relevant to, the dispute, other than any matter before the High Court until the final determination of those proceedings, and to report'.
"These terms allow all the circumstances and issues involved to he examined, other than the ACAS recommendation on union recognition, the validity of which is being challenged by the company in High Court proceedings which begin next week.
"The Chairman of the Court of Inquiry will be the right honourable Lord Justice Scarman. The other

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members will be Mr.J. P. Lowry, Director of Personnel, British Leyland Limited and formerly Director of the Engineering Employer's Federation; and Mr.Terence Parry, General Secretary of the Fire Brigades Union. I have asked the Court to begin its work with the greatest urgency.
"Courts of Inquiry under the 1919 Act are not set up lightly. This is only the second since 1972. But this has been a very long, bitter and damaging dispute, which still shows signs of widening.
"I believe that a Court of Inquiry is now the right course. Over the years, Courts of Inquiry have brought about the resolution of other disputes that were equally damaging and intractable.
"To do so the Court needs every possible help. First, it will be looking for full co-operation from the parties. I would urge them to give every assistance to the Court and help to expedite its proceedings.
"Secondly, and this is most important, it needs to be able to proceed in a reasonably calm atmosphere.
"Action by either party aimed at reinforcing entrenched positions including mass picketing or any other action that might lead to breaches of the law, does not help, and I would appeal to both APEX and Grunwick to consider whether their behaviour is calculated to increase the chances of achieving a peaceful solution of the dispute. I am well aware of the strength of feeling of both parties to the dispute, but I think I am entitled to urge this upon them and upon others involved. I would also hope that this appeal will have a full support of the TUC.
"Finally, the Court's attempt to seek a peaceful solution needs the full support of the whole House, and I am confident that this will be forthcoming. I hope that any statements made now or in the debate we are to have later will be of a kind that will help and not hinder this effort to find a peaceful solution".
My Lords, that concludes the Statement
4.13 p.m.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, this is a very im-
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portant announcement and I am sure that the House is grateful to the noble and learned Lord for having repeated it in this House. I am sure also that we should continue to be informed, step by step, of any matters of which the other place is also informed at the same time.
I certainly agree with the final paragraph of the Statement. Of course, we are not holding a debate here—a debate is being held in another place but that does not affect us—but I think it is very important that anything that is said in Parliament should be said in a tone, and perhaps in words, that do not inflame feelings on either side. I therefore want to be very careful about anything that I may say on the matter.
I did not myself anticipate the announcement of a court of inquiry but I am far from saying that it was not the only weapon left in the Government's locker, so I do not want to criticise. Perhaps the noble and learned Lord, when he comes to reply, could remind us exactly what the powers of such a court are. As he says, the appointment of one is slightly unusual in modern industrial practice—the Act, of course, dates back to 1919. Perhaps we can be told what will be the status of its report. To what extent will the report include, or be capable of including, recommendations, as distinct from findings of fact, and what powers of enforcement, if any, either during the proceedings or thereafter, exist? I think that the House would like to be informed about these matters because not everyone is fully aware of them.
I must say—and it is the only thing on which I think I can make a very positive contribution—that the noble and learned Lord and the Government could hardly have found a more acceptable chairman than Lord Justice Scarman. He really is an outstanding judge, and I think his contribution to the national life will increase as time goes on. Naturally enough, I wish the inquiry every possible success and I can at any rate speak as to the chairman, although I personally do not know the other very distinguished people involved. I am sure the Government have chosen the best possible chairman for this purpose.
My Lords, I myself rather wish that the appeal made to APEX and Grunwick in the eleventh paragraph of the Statement

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had extended more explicitly to other bodies concerned, because the situation has now developed well beyond the original disputants and I feel that it would have been helpful to have appealed more directly to those on one side or the other who have been encouraging activities which might inflame feelings, pending the hearings of this inquiry.
The noble and learned Lord and the House will have noted the rather serious statement made by the Master of the Rolls in a speech yesterday when he said, "The mobs are out". What had seemed to be a small dispute the size of a man's hand has now cast a shadow over the sky of the whole constitutional life of this country. We must hope and pray that the forces of decency and law will prevail in the end.
Lord GEORGE-BROWN: My Lords, I—
Several noble Lords: Order!
Lord WIGODER: My Lords, we on these Benches also welcome this Statement, and would certainly support the appeal contained in it for restraint by all parties in the period leading up to the time when the court sits, and also for full-co-operation with the court when it does sit. We note with interest that it was only yesterday that my honourable and learned friend in another place, Mr.Emlyn Hooson, said that there was a clear case for a totally independent inquiry into the state of affairs at the Grunwick factory. It is in the interests of all concerned that such an inquiry should take place. In these circumstances, it is right that we on these Benches should thank the Government for acting so very rapidly upon the proposal put forward by the Liberal Party.
If I may, I should like to ask the noble and learned Lord about one matter. Under Section 4 of the Industrial Courts Act 1919, the Minister, when he refers a matter to a court of inquiry, may refer any matters which appear to him to be connected with, or relevant to, the dispute. May I ask whether any decision has yet been taken as to what are the matters which are relevant to, or connected with, this dispute? In particular, will those matters include certain areas where, clearly, the law is at the moment in a somewhat unsatisfactory state? These include the
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whole law of picketing and the question of the closed shop and the rights of individuals in certain circumstances to decline to join a trade union. Also, what are the powers of ACAS to carry out ballots in circumstances such as this? We would hope that the court of inquiry would have the widest possible powers to consider not simply the immediate area of this dispute but also a number of these controversial and highly relevant areas that are directly connected with it.
4.19 p.m.
The LORD CHANCELLOR: My Lords, I am grateful for the welcome which has been given to the proposal to set up a court of inquiry. Its aim is to find a peaceful solution to the painful situation which has arisen, and I am very happy to note from the tone and content of what has been said that your Lordships will certainly seek to further that aim. Of course, I forgive the noble Lord, Lord Wigoder, for claiming for the Liberal Party parenthood of this suggestion. I do assure him that it was something which was contemplated even before the observations made by Mr. Emlyn Hooson in another place.
But coming to the serious aspect of this matter—and I am grateful for the welcome of the proposal by the noble Lord, Lord Wigoder—the noble and learned Lord, Lord Hailsham, asked about the status and powers of the court of inquiry. Its status is that of a statutory body, whose report will be made to both Houses of Parliament. It can make recommendations. The extent of compliance with those recommendations will depend upon whether those who are affected by them will recognise that those who constitute this court are men of great standing. As the noble and learned Lord, Lord Hailsham, said, Lord Justice Scarman is one of our most eminent judges, who has given great service to the State, and he is supported in this inquiry by two distinguished experts in the field of industrial relations—if I may say so, on both sides of the fence. Therefore, I would expect that any recommendations that emanate from this body will be accepted and followed up.
The court has power to order persons to attend and produce papers. In this field, there are no specific statutory powers, or powers in the field of contempt, but once again I would hope that the status of the

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body and its statutory position—the fact, as I say, that it will report to Parliament—will add up to full acceptance by all concerned of their duty to co-operate to the full with the court of inquiry. I agree with what has been said, that it is important to defuse the explosive situation that has arisen and I am satisfied that the terms of reference, which are very wide, will enable the court, if it thinks fit as I would expect—it will, of course, be for the court itself to determine what ground it should cover, whether it will deal precisely with the matters referred to by the noble Lord, Lord Wigoder—to consider how the dispute began, the strike, the dismissals, the behaviour in an industrial relations sense of the union and the company, what next to do and matters of that kind. The terms of reference have been made deliberately wide, so that all of these matters may be considered; and I repeat the plea that has been made by the Secretary of State, that all that is necessary should now be done to restore calm to enable this inquiry to be conducted, and that those actions which have up till now been taken which have inflamed the situation should cease.
Lord GEORGE-BROWN: My Lords, if I may just add to that my personal welcome for the setting up of the court and relieve the noble and learned Lord who sits on the Woolsack of any unhappiness, I called for this last Friday and I am very glad that both the Liberal Party and the Government have caught up with me in the course of little less than one week. But it was, I believe, the only step left that the Government could take. Of course, inevitably, there is a certain weakness in courts of inquiry, but having been involved with them and with the Act which set them up, I feel that there was nothing else the Government could do. As to membership, I, too, join in unreserved congratulations on securing the services of the chairman. But while, I hope, choosing my words as carefully as other noble Lords, I am a little surprised at the membership. I should not have thought that the past history of British Leyland's industrial relations was an outstanding recommmendation, and I am a little surprised about the Fire Brigades Union. But now that they have been appointed, one can only wish them both, with the chairman, the best of luck.
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What I really rose to put to the noble and learned Lord is perhaps something that can be put only from one on these Benches, and one can hardly expect him or the Minister to put it. But when we make a plea to both sides now to calm it and cease provocative actions, and let the court have the right atmosphere in which to proceed, what we really mean is that APEX and the TUC should call off mass picketing from any other unions with which they are associated. We also mean that those highly political advisers, who have gone in to help Mr.Ward—perhaps I should put the word, "help" in quotes—whose knowledge of industrial relations is, I should have thought, a good deal less than their knowledge of political issues, should now step down and then the issue will be able to be judged in the calm that it should have.
4.26 p.m.
Lord SHINWELL: My Lords, is my noble and learned friend aware that if the court of inquiry confines itself to the cause of the trouble, and seeks an urgent solution, that is one thing? But if it is to extend its range over the question of peaceful picketing et cetera it will raise a number of other important political issues that may cause further trouble? Is he further aware that there is a rumour in the City of London in business circles this morning that a number of very prominent businessmen, who are concerned about an extension of the dispute through the Post Office, electricity and in other important directions, are proposing to acquire an interest in the business and bring about an urgent solution of the problem? Is he aware of this rumour in the City of London in business circles, because, if he is not aware of it, I am.
The LORD CHANCELLOR: My Lords, I am invited to answer that question. The answer is that I have no knowledge of these manoeuvres. If they are existing, I hope that they will cease. I detect that the message emanating from this House at this moment of time is "cool it", and that is the best atmosphere in which this court of inquiry can progress. I am delighted to judge, from yet another claimant to parenthood of this idea, that it must have a good deal of legitimacy. I think that the composition of the court is admirably suited for this situation, and I think that the best service we can

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now do to it is to wish it every success in its endeavours, which are to find a peaceful solution to the strike and not wander on a large academic range of investigation.
Lord CLIFFORD of CHUDLEIGH: My Lords, can the noble and learned Lord just enlighten me on one point? How does this arrangement affect the court case, which I believe is going on at this moment, about the postal workers' interference with the mail going to Grunwick? Perhaps I ought to declare an interest in that my nephew by marriage happens to be the Director of the National Association for Freedom, and I know that there are various plans afoot for getting the mail through to Grunwick. How will the court case and other matters be affected by the Government's plans?
The LORD CHANCELLOR: My Lords, the position is that the terms of reference, which I read out, specifically exclude the matters which arise in the case before the High Court and there will be no clash. Of course, as Lord Justice Scarman is the Chairman, he will see that there is no overlapping with the issues that arise in the court proceedings.
Lord HALE: My Lords, will my noble and learned friend confirm that this tribunal of inquiry, constituted under the Tribunals of Inquiry Act 1919, is precisely the Act under which the Belcher Tribunal was constituted, upon which he conducted a campaign on injustice almost unparalleled, in my experience? Is he not aware—I am sure he is—that, time after time since then, we have raised the injustice and impracticability of the proceedings in this Act, which permit cross-examination without any direct relevance whatever to British laws of evidence on the asking of questions.
The LORD CHANCELLOR: My Lords, I hasten to reassure my noble friend that this has nothing whatsoever to do with the Tribunals of Inquiry (Evidence) Act 1921, or the proceedings under that Act, so he can set aside forthwith his anxiety. The court is to be set up under the Industrial Courts Act 1919. The previous courts which have been set up under that Act have operated justly and fairly and have never been subject to the
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kind of criticisms which flowed from hearings under the Tribunals of Inquiry (Evidence) Act.

ROYAL ASSENT
4.31 p.m.
The LORD CHANCELLOR: My Lords, I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts and a Measure:

Restrictive Trade Practices Act 1977,

Transport (Financial Provisions) Act 1977,

Neath Borough Council Act 1977,

Heritable Securities and Mortgage Investment Association, Limited Act, 1977,

Emu Wine Holdings Limited and Subsidiary Companies Act 1977,

Incumbents (Vacation of Benefices) Measure 1977.

PRICE COMMISSION BILL
4.32 p.m.
Second Reading debate resumed.
The Earl of MANSFIELD: My Lords, coming to perhaps rather more contentious matters, first may I congratulate the noble Lord, Lord Oram, upon what was a commendably brief exposition of his Bill. I am bound to say that I welcomed the lack of heat with which he performed his task. I listened with considerable interest to whatever justification he might bring forward for the introduction of his Bill which, no doubt, the Government hope will become an Act. If I say that to me, at any rate, the noble Lord was somewhat coy, it may well be that he had excellent reasons for adopting that particular stance.
At one moment in his speech the noble Lord said that this is a Bill to which the Government attach great importance; and indeed it is. However, when it first saw the light of day, the other place was told—and certainly the Press were told—that one of the principal ideas which motivated the Government was their attack on the still intolerably high rate of inflation. That has now more or less disappeared as one of the Government's arguments. Little

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reliance is placed upon it, although I shall come back to it a little later in my speech. However, what has certainly happened is that this Bill has aroused great anxiety in industry.
The objections of industry are that the Bill will do little to keep down prices but that it will do a lot to create uncertainty in industry and commerce. It is this state of uncertainty which is the principal line of objection and what noble Lords on this side of the House regard as so undesirable. Unless there is confidence in the world of business and, more especially, in industry, there is unlikely to be that degree of investment which alone, in the long term, can create industrial expansion and jobs and bring down the present record levels of unemployment. Unless the economic situation of the country becomes more settled—unless, indeed, the pound remains steady—there is little hope, bearing in mind matters that are outwith the control of the Government (and among these I include the price of raw materials which are imported mostly from abroad) that the rate of inflation can be brought down to a satisfactory level.
I say this because, I repeat, important though the Government regard their Bill, the greatest misgivings have been vouch-safed by industry. I wish, in a way, that the noble Lord, Lord Oram, had mentioned them and at least tried in some way or another to show that these misgivings were either without foundation or at least did not need to have placed upon them the importance which they assume. It is also a pity that so far, at any rate, there are no Back-Bench speakers from the Government side of the House; nobody has put down his name to speak. From what I read, I gather that the TUC played a leading part in the thinking behind the Bill and a leading part not so far behind the scenes during its passage in the other place. It is a matter of regret that noble Lords on the Benches opposite, with a wealth of experience of both the unions and industry, are not here to give us the benefit of their advice and experience and to allay our fears.
When I came down from Scotland this morning and heard on the radio that a certain body of opinion of noble Lords opposite wished to disfranchise me, I hurried to get the report of the Working
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Party. I see that the Working Party, headed by the noble Lord, Lord Champion, says:
"We propose a system of voting Peers limited as to numbers and reflecting in their selection the Party balance in the House of Commons. This, together with the proposals for the composition of the House, would end, once and for all, the in-built one-Party domination in the second Chamber".
It will be an ill day for the future of this House and for the country if there is to be substituted for debate the clump-clump of the feet of voting Peers nominated by a Select Committee of the House of Commons.
It is quite certain that the only way in which this Bill can control inflation is by reducing profits. Therefore the first question one has to ask oneself when considering the matter is whether the level of profits before tax and interest is too high, speaking generally, throughout industry. The rate of return on capital has been steadily declining since the 1960s. in that decade it averaged, I believe, about 11 per cent. Last year I believe it was about 3½ per cent. This figure is generally regarded as being much too low. I believe that the Government acknowledge this fact. Indeed, official thinking is that a higher level of profits is needed to produce more investment and more jobs. What is incontrovertible is that if the general rate of profits is too low, the prospects for investment and job creation, the containment of inflation and a rising standard of living are indeed bleak. So we can forget any intention on the part of the Government that this Bill on its own will have any material effect on prices or on anything else. Indeed, the Secretary of State conceded, in effect, in the other place, that if this Bill had been in force soon after the Labour Government took office three years ago its effect on price rises would have been minimal.
Then we turn to the argument that the Bill will provide some form of lever, if that is the right word, for helping to continue a measure of wage restraint. It is not, I suggest, profitable at present to speculate upon the likely character of any new agreement or Phase 3, if ever it should exist in a meaningful form at some time in the future. Even if a meaningful wages policy is hammered out, I suggest that this Bill will have no more than a cosmetic effect on such negotiations, because it is

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clear that only a certain number of investigations into specific price increase proposals will take place each year. If the Secretary of State was right when he said that an effective, socially responsive firm has nothing to fear in the future—and I assume that the noble Lord, Lord Oram, agrees that the vast majority of manufacturing and distributing firms in this country come into that category—then the effect of the Bill will be minimal.
It seems to me, and indeed to others, that the real motivation for the introduction of this Bill is that it gives the Government the opportunity to produce the means for permanent Government intervention within industry, and indeed I do not think it unfair to say that the Secretary of State not only said as much but gloried in it. No doubt there is a sense of disappointment on the part of the Government that planning agreements which it was thought would have a desirable effect, at least from the Government point of view, have not worked and they do not exist. Equally no doubt it is hoped that this Bill will achieve much the same ends by a somewhat different route.
What I suggest is really intended is that this Bill should become part of the Government's permanent powers which they will use in both the fields of competition and monopolies, and also to control sectors of industry. But it is not suggested that even when prices are brought under control the power to investigate them should end. Indeed, it is proposed that they should continue into the future. But it is suggested that such powers should exist and should be used to promote competitive efficiency and to influence to some degree industrial performance.
It is this charter—if I may so call it—for permanent Government snooping into areas which should be outside their everyday concern which gives rise to our opposition to this Bill. Let me make it plain. I believe noble Lords on these Benches are not opposed in principle to the control of prices in the short term for specific purposes or reasons, but bearing in mind that control of prices can never be wholly effective in this country, relying as we do so heavily on imported foods and raw materials, such control must of necessity be short term.
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Equally the distortion of profits through price control is bound to make for a stagnant economy and limit the creation of wealth. One of the matters which we so often complain about is that this Government and those who support them are far too concerned to slice the cake and far too little concerned to increase its size. I suggest that the mixed economy demands the maximum flexibility in the allocation of resources in order to meet changing demands, and a lack of flexibility merely limits the redistribution of resources according to national and international demands. Equally I should make it plain that where a firm takes unfair advantage of its competitive position, more especially if it is in what might be termed a monopoly situation, any Government must be in a position to correct any abuses which may occur. I do not think that is altogether a contentious statement on my part. I think nobody on this side of the House would disagree with that philosophy.
If this Bill was called, for instance, the Fair Trading (Amendment) Bill, if it was designed to fortify the powers of the Office of Fair Trading, or more especially the Monopolies Commission, so that all the Government's power in respect of what I might term competition policy was contained in one Act and exercised by one body, that would be an objective which would command at least some degree of sympathy. Whereas the noble Lord says that one day we shall have some sort of consolidation Act to make sense out of the various measures since 1973 and which, as he himself has said, make for rather difficult reading of this latest attempt, that does nothing so far as this Bill is concerned to, as it were, make one body where at the moment, and under the terms of this Bill, three will exist. In my submission, what the Bill does is to introduce a new body which will exist alongside the other two and which will have a responsibility which is bound in some degree to overlap the other two. It will be a further measure of bureaucracy which, as I tried to show, will have little effect on prices and none on efficiency, except some effect which may well be detrimental.
I do not intend to go into any of the detailed provisions of the Bill because, after all, this is a Second Reading debate on the principles of the Bill and the motivation

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of the Government which has prompted its introduction. So far as noble Lords on these Benches are concerned, we shall not seek to delay the Bill, either unduly or at all. We take the noble Lord's point that it has already had an airing in the other place—I was going to say, ad nauseam, but I had better not. It has already had an airing in the other place, although whether 28 or 29 concentrated hours on the trot is the best way to ventilate and discuss Parliamentary business is not perhaps for me to say.
On these Benches we believe that there are a number of distinct drawbacks to the Bill which will operate unduly harshly on industry. For instance, we think there should be some sort of annual review which will monitor both the performance of the Price Commission and, more especially, of the Secretary of State. We think that there are a number of facets of the Bill which will tend to operate harshly and unfairly on companies which find themselves the recipient of an inquiry on the part of the Price Commission. We shall try to make the Government think again in an endeavour to remove such areas of unfairness, but we shall not have an all night sitting, unless the Government make such a nonsense of their other business that there is no other time in which to consider this Bill.
4.48 p.m.
Baroness SEEAR: My Lords, from these Benches we give our support to this Bill for two major reasons—the contributions that it makes to two areas of policy to which we attach the very greatest importance. In the first place is the contribution which we believe it can make to obtaining, and continuing to obtain—and I underline "continuing to obtain"—an effective pay policy. It was said in another place and it has been implied by the noble Earl, Lord Mansfield, that the effect of this Bill on pay policy would be very slight. I think it has been accepted by all Parties that, if a prices policy can indeed produce a satisfactory pay policy, then that is a price that is worth paying, even for those who are opposed to the policy as a whole.
I gather there is a suspicion that no such satisfactory pay policy is likely to emerge, and that if it does emerge it will be short
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lived. I believe the importance of this Bill in relation to pay has not perhaps been fully grasped in the context of the changing kind of pay policy that we shall certainly get, if not this year then in the years to follow. We on these Benches believe that it is of the greatest importance that we should continue to have restraint in pay. The noble Earl, Lord Mansfield, said this Bill would not cure inflation. Of course it will not, but if it enables a check to be made on inflationary pay claims, then indirectly it will be contributing in an important way towards the control of inflation. I say that it is in the changing context of pay policy that this Bill is of particular importance for this reason.
For the last two years, until now, we have had a very rigid form of pay control negotiated through the mechanism of the Social Contract. It is quite clear that even if we get a Phase 3 it will not be in those terms, not in terms of the same kind of rigidity, the same kind of inflexible policy we have had over the last two years. This is apparent from the reaction that has already come from the TUC. The point I want to make is that it is not only the trade unions who do not want a very inflexible pay policy; it is the companies, the employers, the managers themselves who do not want that very rigid pay policy to continue year after year. Anyone who is at all acquainted with what is going on inside enterprises knows the manifold difficulties at various levels which flow from the application over a two-year period of great rigidity and pay restraint. Therefore, we are not going to get the same kind of agreement we have had in the past.
And yet we must have pay restraint. This means that pay restraint must come because the rank and file in industry are converted to the idea that inflationary pay settlements are, in the long run, highly undesirable for them as well as for the country as a whole. Pay restraint cannot be enforced any longer in rigid terms from the centre. It has to be controlled by consent from the grass roots. It seems to me there is not the faintest hope that you are going to get public opinion to back restraint in pay claims—by "public opinion" I mean not merely the leaders but the generality of employed persons—not just this year or next year, but as a continuing process, unless they believe that there is also power to control prices.

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It may be that this Commission will not do anything very much in terms of controlling prices. But it is there. It means that you can say to people, when you are asking them to see that their pay claims are kept within reasonable bounds, that if indeed prices take off there is a mechanism for seeing that they are controlled. This is in terms of developing the kind of pay policy which, in our view, needs to be a permanent part of national policy; one which can only operate with the flexibility which is seen to be essential on both sides of industry. It can only operate permanently and flexibly if it has widespread support, and that support will come only if there is on the other side a mechanism for controlling prices. For this reason, if for no other, we would go along with this policy, with this Bill.
Our second reason for supporting the Bill is that it seems to us to be an instrument for a competition policy, for a more effective development of a more efficient economy in both the public and private sectors. It was made quite clear in the debates in another place, and it is also plain in the Bill itself, that this is the second very important purpose of this piece of legislation. We on these Benches have always been and remain firm supporters of the market economy, and the market economy within a mixed economy. We are delighted to see in this Bill what seems to us to be the reconversion of the Government to the idea of the mixed economy, which they are now apparently prepared to back in terms of legislation of this sort. Let me admit that there have been times when we doubted whether the Government really did believe in a mixed economy, really did believe in the promotion of competition. We have always assumed—though there have been moments when we have doubted it—that the Opposition believed in competition and the market economy. Doubts about the Government's determination to pursue that policy have arisen from time to time in our minds.
But, my Lords, it would surely be naive in the extreme to think that nowadays the market economy operates entirely freely to see that resources are allocated as they should be, and that the consumer gets a fair deal as a result of the operation of the market. That was at best, or at worst, according to your point of view,
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a 19th century dream. We all know that it does not happen like that in these days of, not only monopoly, which is relatively easy to recognise, but of all those shades of oligopoly which limit the effective working of the market mechanism. If you want competition to work, if you want an effective mixed economy, then you have to see to it that these oligopolistic tendencies do not so weaken the operation of the market that competition is not a reality.
Those who are opposing the development of a competition policy, opposing the need for some Governmental instrument to see that it takes place, have to answer two questions. Why has the market system in this country not operated more effectively than it has done over the last 30 or 40 years? None of us can pretend that with our growth rates, our overseas trading record, we are a great demonstration of how well the market system, left to itself, has been working. They will also have to say why so many other countries which believe, as we do, in the mixed economy and in the operation of the market also have mechanisms for intervention in relation to prices. It is well known that in most, if not all, of the free market countries of the Western World such mechanisms do exist.
So we welcome the Bill for these two reasons. Of course there are doubts; there have been and still are legitimate doubts in the minds of persons who would be affected by this legislation. One of the doubts, which I must say I shared when I first examined this Bill, is the degree of arbitrariness of the powers left to the Commission to make its decisions within the framework of the proposed legislation. "Why pick on me?" Why is this particular concern to be investigated?" Then, what are the criteria by which the Commission will decide that a particular price increase is or is not justified? This was a question which was raised by many people with whom I have discussed this matter. I think I am satisfied by the answer, that you have no choice. In this Bill the Government wish to get rid of the system of the code, a detailed rigid code; that has been the practice for price control in the past. A code is complicated, it is elaborate, it takes up a great deal of time, a great deal of paperwork; it leads to a great deal of argument, and inevitably it becomes out

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of date. There is a rigidity; it tends to be frozen, and as time moves on and circumstances change, a code becomes less and less appropriate as an instrument for deciding what should be done.
If you reject the whole approach of a code, for the reasons I have given, there is no option, if you are going to have any kind of control at all, but to give to the people who are operating the system a degree of freedom of judgment which is the opposite of the rigidity of the code. You need to have flexibility, which may well lead to the question, "How will they make up their minds? How can we be sure that the decisions they make are right?" You either have to say: "We are prepared to leave it to the judgment of the Commission", or you have to settle for codes, with all the limitations and disadvantages that they bring.
When you are choosing to leave it to the Commission to use its judgment, there are, it seems to me, two safeguards which should satisfy some, at least, of those who express anxiety under this head. One, surely, is the names of the people chosen to man the Commission, people of very great experience—at least most of them are who have so far been named—in the world of industry, finance and commerce. This should be some reassurance that at least they will have a deep grasp and wide understanding of the problems of the concerns which they are investigating. The other safeguards are to be found in Clause 2 which lays down—it is true in general terms, but inevitably surely in an Act in general terms—the criteria which justify both investigation and control. It may be that on Second Reading ideas will be brought forward for strengthening Clause 2, though I do not propose to do so. Even as it stands, Clause 2 gives substantial ground for reassurance to those who fear that the Commission can operate in an arbitrary manner.
There is also the fear that has been raised from the Opposition Benches that the existence of the Commission, with the power to investigate, will have a deterrent effect on industry, will limit investment and, by limiting investment, will harm the prosperity of the country and harm the consumer; and this, after all, is primarily a consumer Bill. When one looks at the criteria in Clause 2 and sees the scale of investigation that is
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likely to take place—it has been suggested that about 40 cases a year will be the sort of level of operation—surely it is not unreasonable to say that any organisation which is operating in a reasonably efficient manner, which is not abusing its market position or which knows that it has so small a share of the market that it can defend its case in straight market terms, has very little to fear. It seems to be a very exaggerated argument that because of the possibility of investigation, given the safeguards and the setup that is outlined in the Bill, a large number of organisations will be so fearful of investigation that they will hold back from the development of their businesses. It is possible that that will be the case in some circumstances, but as a general problem for the country as a whole, affecting the development of the economy overall, that surely is a very exaggerated case which is being advanced.
However, we on these Benches would join with the Opposition in the objection to yet a third body. After all, we already have the Monopolies Commission and the Office of Fair Trading. Why on earth do we need a third body on top of those others? It would add to the bureaucracy, complexity and cost. If it is suggested that we need a sharp instrument to help make for more effective competition in this country, I would point out that that is something that we on these Benches have asked for not recently but over decades.
I agree that it is not in the Bill, but can we not have confidence in the statement made by the Secretary of State in the debate last week in another place in which he said, in response to an Amendment urging that the Price Commission should be merged with the Monopolies Commission, that we should move towards a single body:
"… which has the power to present mergers when they are socially undesirable, the power to break up monopolies when they are similarly found to he against the public interest, the power to take action against agreements for restraint of trade, and the power to attack what the hon. Member for Colne Valley rightly called the symptom of that condition which is unreasonable price increases".—[Official Report, Commons, 21/6/77, col. 1575.]
The Secretary of State has not put a time on it, but there he has given an undertaking that we shall move towards this single body with improved powers to

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control monopoly—I am not being critical of the present Monopolies Commission, but it does take between three and three and a half years to produce a report—and deal more widely with matters which inhibit the really effective working of competition.
We must believe that the Secretary of State means that steps will be taken, and taken soon to move in that direction. We on these Benches support the Bill in the belief that that will happen. We intend to keep reminding Her Majesty's Government that this has been promised to us and should take place.
5.6 p.m.
Baroness ELLIOT of HARWOOD: My Lords, I shall be very brief. I am not an economist, but I speak today in a dual capacity. I was the chairman of the first Consumer Council and I know how apprehensive all housewives are about price rises, particularly those affecting the cost of food. Being a producer in particular of agricultural products, I know how hopeless it is if the cost of production and the sale of products do not pay or leave only a small margin of profit. How to reconcile these conflicting interests is largely what this Bill is about.
However, I believe that there is more trouble for the Government—any Government—when prices decrease and the demand for subsidies increases than when industry or agriculture makes profits and the State in consequence benefits by taxation and by those profits. There is no doubt that there is heavy pressure today from all the unions, and we appreciate that that is a pretty formidable matter with which the Government must deal. But to prevent profits also prevents wages increasing and, as we all know, there must be some wage increases. In the long run, everyone benefits from profitability. Loss discourages everyone and costs the Government a great deal of money. I am afraid that some aspects of the Bill may well discourage rather than encourage industry.
I was brought up with a very old principle, which no longer operates—namely, freedom of trade. It is no longer sponsored by any political Party, not even by the Party of the noble Baroness, Lady Seear, from which I sprang in my early life.
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But freedom to trade in all markets, both here and abroad, is still vital. If there is no profit in it and there is so much control, it will not succeed, and that would be disastrous.
The Price Code is a restrictive measure and a somewhat uncertain one as regards producers, as only the Commission can decide the policy which governs the Price Code. The market price—whether through auctions, as in agriculture, in retail competition or in other ways—enables the sellers to estimate the market fluctuations. Although this is a variable figure, given the freedom to make profits and the chance of competition, the manufacturer must take the drop himself, if it comes—not subsidies from the Government.
I agree with those who say that under this new proposal Parliament should have the right annually to review the discussions of the Price Commission. My noble friend Lord Mansfield made that point very strongly, and I entirely agree with him. As most prices fluctuate, particularly prices of food and seasonal products, to try to keep prices at the same level all the year round would defeat its own ends, and sometimes I believe it might even keep prices up rather than let them find their own level. To prevent by whatever means companies from making profits is a hopeless method, and will not enable companies to expand or to develop, nor enlarge their plant or machinery, nor create more employment.
Those are the principles which I am quite sure will lead to prosperity in this country. If this Bill hampers that in any way it will not be to the advantage of the country. This Bill was debated at great length in another place. As my noble friend Lord Mansfield said, I hope that in this House, we have no intention of opposing it as was done in another place, but we could improve it by Amendments, and I hope that we shall show our views in this way and have the opportunity of discussing it clause by clause in order to improve the Bill which we have before us now.
5.11 p.m.
Lord MOTTISTONE: My Lords, I am afraid that this is a Nosey Parker Bill, and one cannot really like it, although there are good reasons for it. I am heartened by the fact that in another place there were many areas in which the

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Government appeared quite conciliatory, and indeed in some cases acted in a conciliatory fashion. I hope—particularly as we have the noble Lord, Lord Oram, whom we know is such a friend of us all, taking the Bill from the Benches opposite to us—that we might be able to carry this a bit further.
With that in mind I looked slightly closely to see what areas looked as though they had a prospect of agreement within them. It seemed to me that one such point was that there was an agreement between us—and indeed the noble Lord, Lord Oram, almost said as much in his speech earlier on—in the need for powers to investigate the prices of businesses in a monopoly or near monopoly situation. I think we would agree with that. In fact, I could go on to quote from the Minister of State in another place, who said, on 21st June, among other things, at column 1187 of the Official Report:
"We need those powers to sharpen competition and to protect the consumer from the abuses that flow from lack of competition".
I think that we would entirely agree with that, and no doubt the Liberals, if the noble Baroness, Lady Seear, was still with us, would endorse that. In passing, perhaps I might suggest to my noble friend Lady Elliot that the noble Baroness may not now agree with free trade but she certainly agrees with freedom of movement.
Going on to quote from the Minister of State—and the noble Baroness, Lady Seear, rather confirmed this—he said at column 1188:
"I hope that my right honourable Friend the Secretary of State will make clear that we do not see a permanent separation of the identity and existence of the work of the Monopolies and Mergers Commission and that of the Price Commission".
It would seem from that that the Government are well on the way to agreeing with us that a separate Price Commission as a permanent basis is probably one which we would not press for. So perhaps it might be that the Government would go with us in concentrating on this business of protecting the consumer from the abuses that flow from lack of competition.
It would be churlish of me to point out in too great detail that most of the abuses flowing from lack of competition are in the sacred cows of the Party opposite—the nationalised industries. It
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is perhaps they who need to have their prices watched, as we have learned in the case of the gas industry in the very recent past. We would not expect the Government rapidly to sweep away the nationalised industries, but perhaps we can see them agreeing to proposals for examining from time to time the usefulness of the Price Commission as a separate statutory body. It could perhaps be that they would look kindly on possible Amendments which worked in that direction.
Another area in which there might be agreement between us is in making modifications to the safeguards established under Clause 9, of which a draft has been published, and more meaningfully to the Bill itself, to take account of swingeing increases in the costs of raw materials, especially in relation to the food and drink industries. I expect your Lordships are aware that the prices of raw materials, on which we have to depend because we are not self-sufficient in this country in an agricultural way, have lately been going up so dramatically that on the shape of what is likely in the future, let alone what has happened in the past, it is very possible for an increase of the final product to have to go up by more than 5 per cent. in as short a period as six months. If, therefore, any business on an annual rate can only expect to make a profit of the order of 10 per cent., it is going to find itself in a position not to be able to make any profit at all if in six months it is going to have a raw material price which will put it up by 5 per cent. That is common arithmetic.
In fact, as my noble friend Lord Mansfield said, the rate of profit which is being made by many industries is nowadays nearer 3 per cent., which means in effect that raw materials without price adjustments over a period of as little as six months can cause a small company to go out of business completely. I know that the small companies are not the ones which the Price Commission will be invited to investigate, or would take the initiative in investigating, in the normal course. Thye will go for the bigger companies; perhaps the market leaders. But when they do this, the market leaders will inevitably set the pattern for the industry concerned, and the result will be that the smaller companies will have to follow them, and the smaller companies

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will be the ones who take the rub and have not got the resources to overcome this sort of trouble.
It is for that reason that the ability of the Price Commission to impose a price freeze during investigation—particularly as the investigation may turn out to prove nothing other than that the company is being perfectly sensible and a freeze is not necessary—and a freeze which can be applied in effect for at least four months, and maybe longer, will create a condition in the market which can put in severe jeopardy, possibly not the biggest companies which may have extra resources (though even they are going to find it difficult), but, very much, the smaller companies who had resources perhaps five and six years ago but have gradually had them eroded by various policies that have been applied in the last five or six years. This is a serious issue, on which one would hope that the Government will go with us in making sure that there are sufficient safeguards, and possibly—as the Secretary of State has said many times he will not—relent on their insistence that freezing must be applied when an investigation is taking place.
If your Lordships will allow, I should like to spell out in a little detail why it is that controls are not really of any practical value in holding down the prices of the more common processed foods. What I am attempting to point out is that not only are we under threat from the actual provisions of the Bill, but in fact experience during the last five years has shown that such price controls as we have had have had no effect at all except to create extra labour for the people who have to apply them, and extra costs which, in due course, put prices up rather than put them down. Before I do so, I must declare an interest as the Director of the Cake and Biscuit Alliance, the trade association looking after the interests of the cake and biscuit manufacturers. For this reason, my examples will relate to biscuits, but the principles they show can be taken to apply to most processed foods.
There is no evidence that price controls have held down the prices of biscuits more effectively in recent years than market forces have done by themselves. On the other hand, price controls have in the short-term added a considerable
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administrative burden and cost to manufacturers and have increased the complexity and uncertainty of forward planning.
The key factors governing pricing decisions in the biscuit trade are, first, costs; secondly, the need to maintain margins for ploughing back into the business; and, thirdly, the desire to maintain the value for money of biscuits relative to other foods. The first two points need little comment. It is well-known that costs have risen sharply, have continued to do so and that previous and present price control procedures have not made adequate allowance for all cost increases to be recouped or indeed to be reflected quickly enough to maintain the necessary margins in the short-term.
Little however has been said about the third point. The fact is that biscuit manufacturers, in common with other food manufacturers, have always been acutely aware of the need to maintain the value for money of their products in relation to alternative purchases, as seen by the consumer. The point is that the competition is not only within the manufacture of one particular product but is also between that product and others which the consumer may buy in lieu. For example, if biscuit prices go too high while bread does not concurrently do the same people, may buy more bread and less biscuits. The biscuit industry's substantial tonnage was built up on this basis. There is clear evidence that when prices rise disproportionately in relation to other foods, volume—that is, sales—suffers accordingly, and there is a very direct relationship in the biscuit industry between volume and profitability. Volume, I should explain, is a phrase covering both sales volume and manufacturing capacity. Hence, on occasions when tax or cost increases have made chocolate biscuit prices rise out of line with other products, their tonnage has declined markedly—as in 1962–63 and in 1974–75—and this has affected the total market.
Up to, and particularly during, 1973, biscuit market volume was on a stable healthy footing while prices rose less than other foods. Chocolate biscuits were especially buoyant in 1973, with artificially low prices. Prices were frozen from November 1972, just when they were

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about to go up, then in April 1973 tax was removed. Hence, in the short-term chocolate biscuits became much better value to the consumer; volume rose by 20 per cent. or more and manufacturers could not meet demand. From mid-1973 prices were allowed to rise and, with ingredient costs escalating, they went up sharply. Tax was reimposed in April 1974, exacerbating the situation, and volume was immediately and severely reversed.
The severe price rises of 1974–75 resulted in a drop in consumption of about 7 per cent. in 1975, concentrated however on the higher priced lines, particularly chocolate, which declined by 20 per cent, to 30 per cent. It should be noted that these very steep price rises occurred while price controls were operating and it is most unlikely that if there had been no controls manufacturers would have risked putting up prices further at that time because, as I have attempted to explain, to do so would have reduced sales even further.
In 1976, as biscuit price inflation dropped below that of related foods, consumption and market tonnage began to recover. With more difficult trading conditions in the last three to four years, biscuit manufacturers have endeavoured to maintain volume, and hence profit, by introducing smaller packet sizes and by developing lower-price ranges and have been largely successful in these aims. This is further proof of the significance of relative food values in efficient manufacturers' planning processes, and noble Lords will have noted that emphasis was laid on efficiency by the noble Lord, Lord Oram—indeed, it is mentioned in the Bill. It is efficiency which I have just been talking about; adjustment to meet the market as it occurs.
If anything, the presence of price control mechanisms and the uncertainty which these have brought in recent years, with the ever-present threat of tighter controls, of freezes, have led manufacturers to take whatever price rises they could justify in the short-term whenever there have been cost increases. As a result, what has tended to happen is a less smooth, more concentrated and exaggerated series of price increases than would have occurred if manufacturers had been able to adjust prices solely
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according to the normal market-place and competitive considerations.
Noble Lords will see from this brief view of the effect of price controls on a typical food item that they have no effect on keeping prices down, but they add to overall costs in administration and distort such price adjustments as are made necessary by increasing the costs of manufacture. I would not argue at this time for no price controls at all for all food products because, sadly—and I think erroneously—people in the country have been led to believe that they have some effect on keeping down the retail price index.
I noted that the noble Baroness, Lady Seear, made great play of this point and emphasised that one of the main reasons why the Liberal Party were supporting the Bill was because they saw it as the only way of convincing people that they should restrain their wages. I suggest that people in this country are not as stupid as all that; they could surely realise that there are better ways of controlling prices, as I have endeavoured to show, than in statutory controls the effect of which may be very damaging to business and, in turn, to labour prospects.
It would seem to me that what we would be much better advised to do—perhaps not immediately because so much propaganda has gone into the benefits of price control; here I am not particularly blaming the Party opposite because my noble colleagues in the past have been just as enthusiastic in imposing price controls—is to accept that experience has shown that this is not the way to restrain prices. So, if it is necessary to produce some bargaining element when one is talking to people about restraining wages, probably the best bargaining element is for the Government to promise to cut their cloth according to their means, which indeed they are trying to do, or saying they are trying to do, and one hopes that they could demonstrate that continuingly and point out that this is the way in which the greatest contribution to reducing inflation will occur.
What I think is reasonable is that we should endeavour to educate the country into understanding that prices are best controlled by a free market and that if we need any form of control it should be

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applied to those businesses which have a near monopoly situation. As I said earlier, I think that the Minister of State was going a long way with us in his various speeches, but I am a little concerned about the Secretary of State, who, it seemed to me, made some very frightening speeches at both Second and Third Reading in another place. I would hope that all he was doing was putting on a front so as to appear to be a hard man, in order to appease the distressed British "Lefties" whom the poor Labour Party still has around its neck as ballast to keep it in Parliament. Let us hope that, when it comes to the point in this House, the views expressed by the Minister of State are the ones which will prevail in giving advice to the noble Lords opposite, and that the Secretary of State's contribution is treated as being just a bit of light relief to encourage the troops.
Lord PEDDIE: My Lords, I did not wish to interrupt the noble Lord's flow of argument earlier, but I wish to refer to the fact that he made an assertion that the average rate of profit is 3 per cent.— but 3 per cent. of what? Is it 3 per cent. of capital employed, or 3 per cent, of turnover? I think that that assertion needs some explanation, and so I should be glad if the noble Lord opposite would explain precisely what he meant by his statement on average rate of profit.
Lord MOTTISTONE: Yes, my Lords; I was, in fact, talking about 3 per cent. of capital employed.
5.31 p.m.
Viscount ROCHDALE: My Lords, the noble Lord, Lord Oram, when introducing the Bill made the point that he and his colleagues regarded it as a very important Bill. I would agree with him on that. Therefore, I was rather surprised when I saw the very small number of noble Lords who had put down their names to speak in this important debate. Looking through the list of speakers, I think that I am right in saying that I am the only speaker who can claim to have been a manufacturer during a great deal of his career. But, regrettably, under the rule of three score years and ten, which applies whether one looks in the psalms or in the Companies' Act, I am no longer in that position, and therefore have no interest to declare.
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Accordingly, I shall come to one or two points which seem to me very important. As I think my noble friend Baroness Elliot of Harwood pointed out, we are none of us pleased when we go into a shop to buy something, only to find that what we want to buy has gone up considerably in price since we were last there. Without pausing to think, we at once tend to blame the poor manufacturer—and we may even use an unparliamentary word before the word "manufacturer"—for trying to make, as one often hears it said, "immoral" profits out of the pockets of the poor customer. Alternatively, we may condemn the distributor for adding indecent mark-ups.
Had we stopped to think, we might have remembered how commodity prices, wages, and the high cost of many services affect prices. All are largely outside the control of manufacturers. We might also have reflected on the time that the effect of many of these things takes to filter through to the goods actually on the shelves in the shops. Had we been prepared to probe just a little deeper and to examine some figures—and here I am coming to the point that was raised a moment ago when my noble friend Lord Mottistone sat down—we should have found that, whereas in the 1960s the average return on capital of industrial and commercial companies, on a replacement cost basis and before tax and interest, was about 11 per cent., the figure for 1976 was that which was quoted a moment ago of 3½ per cent. I hope that I have made it exactly clear to what the 3½ per cent. in fact related.
Clearly the case for continued price control cannot rest on excessive profits, nor indeed on any lack of competition, when, for the vast majority of markets, competitive pressures are considerable, particularly in many of the more essential markets which influence the retail cost of living index. The noble Lord, Lord Oram, will, when he replies, no doubt confirm that, on more than one occasion, spokesmen for Her Majesty's Government have argued—and rightly so—that as part of their so-called industrial strategy profits must be allowed to increase to provide the funds for increased investment.
I assume that the Bill must therefore be within the scope of that general policy.

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In other words, the Bill cannot have the purpose of reducing profits and profitability. One is therefore forced to the conclusion that the case for the Bill is in no way economic, but rather is political, and, I would add, political on two counts. The first count is that it is a gesture—a quid pro quo, or whatever one likes to call it—for continued pay restraint. Human nature being what it is (and it is often very gullible) and bearing in mind the importance of establishing a Phase 3, to which the noble Baroness, Lady Seear, has referred, I am prepared to accept the quid pro quo argument, however regretfully. However, I accept it conditionally. The condition that, as I see it is needed to make the purpose of, or the case for, the Bill really credible is that the Bill (or the Act when it becomes an Act) should become operative only if, and when, a Phase 3 really does emerge on a generally acceptable basis. By a "generally acceptable basis", I mean at any rate a basis which would be generally acceptable to, for instance, the CBI. A further part of the condition would be that the Bill should last no longer than Phase 3, or possibly, again as the noble Baroness, Lady Seear, suggested, if there were to be what, for want of a better phrase, I would call Phase 4, or Phase 5, the Bill should last only as long as that lasts. But, as has been clearly pointed out, that is not what the Bill says. The Bill says quite categorically—and I think that the noble Lord, Lord Oram, said this himself—that it is designed to go on indefinitely.
That brings me to my second political point. I have no doubt that the present members of the Commission—and I noted what was said about the new chairman being mentioned just a week or so back—are very respected, sensible individuals who can be relied upon to do their best and to make wise, sensible, unbiased decisions. But members of the Commission will come and go. They are appointed by a political Secretary of State—I am not saying anything about the present Secretary of State—and Secretaries of State come and go, too. It is all too easy to see how the Bill, when it becomes an Act, could be used as an instrument to gain more and more control over private industry.
My Lords, let me explain how I see the matter working out. Assisted by inflation, profits could be gently and quietly
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brought down to a level which was quite incapable of providing resources for essential investment. So, what would happen? A generous Government would come forward with a tantalising offer of cash, provided, perhaps, under the Industry Act or the NEB, but with strings; and those strings would progressively enmesh the company concerned in the Whitehall web. While, in so doing, this might well achieve the purpose of some (although, I suggest, not all) noble Lords on the opposite side, it could, in my view, all too easily, in time, provide a sedative to enterprise, and therefore clamp down competitiveness, which I think is the most important point of the whole issue, and therefore be adverse to improving employment.
For that kind of argument I should like to see the Bill definitely limited to a term of 12 months. That may be something of a pipedream; but, failing that, at any rate I should like to see it, as other noble Lords have said, subject to renewal, perhaps by Order in Council, on an annual basis, so that, at least, year by year Parliament can keep the matter under review and see how things are going along. Especially is that important—again referring to a point which my noble friends have made—where you have an agency such as the Commission, with such a very wide degree of discretion.
My Lords, there is one further point I want to make. I do not think it is a Committee point, though it may come up again when we discuss the Bill in Committee. Under Clause 5(3) companies can be prevented from putting up their prices while they are being investigated. This looks to me dangerously like treating a company as guilty until it has been proved to be innocent. In practice, it could be extremely damaging, and certainly, in my view, it needs amending. But, my Lords, that clause does something else which worries me quite a lot. It panders to the rather nasty, if prevelant, point of view that manufacturers as a class are inconsiderate tycoons, seeking only their own profit regardless of the interests of anyone else. Of course there are black sheep in every flock: there are black sheep in the manufacturers' flock, there are black sheep in the trade union flock. But in my view the average manufacturer is a good, responsible citizen. He is anxious to do his best, often under great difficulties

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—to do his best for his employees, for his customers, for his shareholders and for his suppliers. He is jealous of his own good name and of the quality of his products. He is proud of his plant and is anxious to invest in it to improve it still more; and he is proud of his company's contribution to the national good.
I am afraid this is not always the picture of manufacturers which is painted by the political cartoonists; yet I feel it to be far more often the case than otherwise. This Bill does not encourage the picture of manufacturers that I myself have tried to paint. Nor does it make one think that that is necessarily the view of manufacturers taken by Her Majesty's Government. I hope I am absolutely wrong when I say that. At any rate, my Lords, I have given the noble Lord, Lord Oram, an opportunity to put the record straight, and I hope he will do so.
5.45 p.m.
Lord ORAM: My Lords, many interesting and a number of controversial points have been raised in the debate. I shall not be able to deal with them all, of course, but I shall do my best; and, if I may, I will take the speeches almost entirely in the order in which they were made, dealing first with that of the noble Earl, Lord Mansfield. He called me coy in relation to the importance of this Bill. Of course, we all prefer our own adjectives for our own description, but I would have thought I was balanced and realistic in summing up the importance of this Bill. I did not over-exaggerate its importance because, although I believe it to be a most important anti-inflation measure, I stressed in my opening speech that it is to be seen only in conjunction with other measures. In itself, no one is claiming that this will overcome inflation, but it is a most important part of the general strategy for overcoming inflation.
I wonder whether I may use an adjective, without any offence, about the noble Earl. I thought he was sober in his approach to this Bill, certainly by comparison with the more excitable leadership which has characterised the debates in another place; and I welcomed the general tone of his speech, even though, obviously, I did not welcome all its content. He complained that the Bill would lead to uncertainty in
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industry. I believe he was fully and adequately answered by the noble Baroness, Lady Seear, who pointed out that within the criteria which are set out in Clause 2, within the safeguards which are to be provided and within the general range of procedures which are laid down, there is ample assurance to industry that there will not be excessive investigations and that investigations will be pursued in a responsible manner which need arouse no fears in the breasts of those in charge of industry. I accept what the noble Earl said about the great importance of confidence in industry, and how confidence does indeed condition investment and employment.
The noble Earl asked—and I think the noble Viscount, Lord Rochdale, and others, perhaps, also made this point—about the level of profits. The noble Viscount said that the case for this Bill cannot rest on excessive profits, and the noble Earl, Lord Mansfield, was making a similar point. I agree, and the Government acknowledge that, in real terms, profitability is now at an all-time low. This reflects the effect of inflation and the low level of output resulting from the recession. But we hope and expect that, with a reasonable recovery in world trade and industrial output, profitability will increase over the next year or so. We have taken various steps to help, such as modifications in the price code, capital allowances, stock relief and so on, to give companies a more favourable situation with regard to profitability. But I stress that real improvement can come only with growth in the economy, and the proposed Price Commission to be set up under this Bill will not be the enemy of that growth; it will be one important help towards that growth.
The noble Earl, as did, certainly, two other speakers, raised the matter of the relationship between price control through the mechanism of the Price Commission on the one hand and wage restraint on the other. This relationship of course exists. I thought that the noble Baroness, Lady Seear, spelt this out admirably. I wish to disagree with not one word of her analysis. Of course, wage restraint can be acceptable to public opinion only if there is seen to be price restraint. The noble Lord, Lord Mottistone, in his speech said that this was suggesting that the British public was stupid. I would suggest that it clearly proves that they are

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hard-headed rather than stupid. Of course, it is in all reason that, when people are subjected to influences, requests and demands to keep their wages down, they will look to see what is happening to the prices in the shops and will ask that the Government which demand wage restraint of them should also do something to restrain prices.
Then the noble Earl, Lord Mansfield, raised the question of permanence—and here, again, he was joined by the noble Viscount, Lord Rochdale—because, as they quite rightly pointed out, the Bill proposes that the investigatory powers shall be permanent. What was remarkable about the noble Earl's speech was that I do not think he once mentioned the word "consumer". He does not seem to recognise that, as the noble Baroness, Lady Seear, pointed out, this is largely a consumer Bill and that the consumer interest, and the need to protect the consumer interest, is not the short-term emergency that he was prepared to accept but a long-term interest; and that, therefore, the machinery we have devised for protecting the consumer interest in this way must also be permanent.
My Lords, there has been talk of the relationship and the overlapping between the Price Commission and the Monopolies Commission. This is true; but I hope that no one will suggest that the Monopolies Commission should last for only a year. We see the Price Commission as doing a job comparable with that of the Monopolies Commission and we believe that it should have permanency just as the Monopolies Commission has permanency. There was one final point which the noble Earl made and which I warmly welcomed. He said that he and his colleagues certainly were not going to cause any unnecessary delay to this Bill. I very much appreciate that this should be the attitude with which we go into the remaining stages of the Bill. There will be need for a good deal of discussion and, in this connection, I would welcome also what the noble Lord, Lord Mottistone, said in his opening remarks. It is not that I am a friend of all. He may find that I am sometimes a little unfriendly, but I welcomed his remark about my right honourable friend having shown a spirit of accommodation when faced with reasonable Amendments. I hope that we can do the same in this House. Indeed, a
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number of Amendments which were made in another place were made by common agreement between the two sides of the Committee, though there were plenty that divided them. I hope that we can make reasonable Amendments as we go along.
I have already commented not a little on the speech which we heard from the noble Baroness, Lady Seear, and, particularly, on the relationship between pay policy and price policy that she so admirably spelled out. I found myself in agreement with her on practically all that she said, including the question of the approach to a possible merger between the Price Commission and the Monopolies Commission. She quoted from my right honourable friend the Secretary of State. I assure her what he said expresses his longer-term view; but there are real differences of policy related to the two bodies in the short term. It would not be possible to use this Bill to bring about that merger but it would be our hope that, in the future, the overlapping could be eliminated.
There was just one point upon which I am sorry to disagree with the noble Baroness. It was when she felt that there had been some doubt whether the Party for which I speak believes in a mixed economy. It does, I do and she does; and I am glad that that is so.
Perhaps I may now turn to the speech of the noble Baroness, Lady Elliot. She raised my hopes with her opening sentences when she referred to the fact that, as we all recall, she had been chairman of the first Consumer Council, and pointed out that consumers were most anxious about rising prices. But, immediately after having made that encouraging introduction, she went on to talk as a producer. She looked back with nostalgia at the times when it was possible to think of the free market economy as the cure for all economic ills. I am not sure that it ever was. Obviously, she at one time thought that it was; and I agree that very few people—although there are still some—really believe that the free market economy is the means of reconciling conflicting interests between consumers and producers. Some mechanism of regulation is needed in order to produce the right balance; sober consideration of all the facts in relation to particular situations is required. We

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believe that the Price Commission will be one of the important pieces of the mechanism to achieve that balance.
My Lords, I have referred already to the noble Lord, Lord Mottistone, at one or two points. I am sure that he will not expect me to follow him in his close analysis of the biscuit trade. Certainly, I am very fond of biscuits, but I have not all the analyses of the problems that he mentioned at my fingertips. However, I noted a number of his points with considerable interest. He made the point that prices in nationalised industries need to be watched as much as prices in the private sector. I agree.
Lord MOTTISTONE: My Lords, not "as much as" but "more than" and "instead of".
Lord ORAM: My Lords, certainly not "instead of". I would say "equally with". Our new price policy makes no difference between the treatment of nationalised industries and the private sector. The criteria in Clause 2 of the Bill will apply to the nationalised industries in the same way as they apply to all other enterprises. Nationalised industries can, therefore, be subject to investigation or examination on the same basis as industry generally. It may not entirely satisfy the noble Lord but its satisfies me that there should be equal treatment between the two sectors.
The noble Lord made the point, from his considerable experience in the food trade, that price controls had not been effective there. I recognise that, in the realm of food in recent years, the effective control has been competition. But this Price Commission will have a much wider scope than the particular area to which the noble Lord draws attention, and there are considerable areas where competition is not so full as it is in the area to which the noble Lord made special reference.
Though I have not replied specifically to the noble Viscount, Lord Rochdale, I have taken up a number of his points during the course of my answers to other speeches. I reiterate my thanks to those who have indicated that, though we shall in the following stages of this Bill need to examine many problems again very carefully—less fully perhaps than in
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another place—nevertheless, we shall go into those debates in a constructive spirit to make the Bill what it should be.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

SERVICE WIDOWS (EQUALITY OF PENSIONS) (No. 2) BILL [H.L.]
6.1 p.m.
Baroness VICKERS: My Lords, I beg to move that the Bill be now read a second time. A Bill with all-Party support was introduced in another place earlier this year. Following that, two Members of the House, Mr. Peter Viggers and Mr. Philip Goodhart, wrote to the Prime Minister and received a reply in the following terms:
"My concern and sympathy for these widows comes directly, as you will recognise, from my personal experience I mentioned in the Censure debate".
He added:
"I am certainly not prepared to defend the distinction based on rank which existed before the 1952 scheme".
However, after that nice opening, he turned down a proposal stating:
"If pre-1950 Service widows were to be awarded pensions retrospectively, there would be equally valid claims from other groups".
He then mentioned some of them.
In a debate in the other House in 1972 on the Consolidated Fund, I quoted from a reply from Mr. A. V. Alexander, who had been a Minister in his day, who stated in May 1949 that a review was being made. While having made several attempts since then to get some change, I was rather affronted when I wrote again to the Ministry a little later. I received a reply from a civil servant which, I am afraid, was in these terms:
"I am afraid there is nothing I can usefully add to my letter of 19th June and, in these circumstances, I can see no value in any further correspondence".
I considered then, and I do so today, that it was an unfortunate attitude to have been taken, and this is really what has happened ever since 1948.
There have been exceptions; there have been payments in special circumstances.

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For example, following the sinking of HMS "Saumarez", and HMS "Volage" off Corfu, pensions were awarded to widows and orphans of the officers and men who lost their lives. I want to emphasise "officers and men". Pensions were paid in accordance with the rates laid down in an Order in Council of 4th June 1948. It was considered and then called "compensation", but actually they were pensions paid over a number of years.
The noble Earl, Lord Mountbatten of Burma, stated at a Royal British Legion Conference, commemorating 50 years of work:
"It is painful to sit here and realise we are behind every Commonwealth country in the treatment of war widows. Why is it that year after year Governments are so hardhearted about it?"
There has just been another conference of Commonwealth Parliamentarians and I took the opportunity of checking with some of them regarding pensions in their countries, and they are considerably better than ours.
While I acknowledge that since 1972 some welcome changes have been made, it still remains the fact that widows of the men in the Armed Forces who fortunately have never heard a shot fired in anger, and who were often able to accompany their husbands, should —quite rightly—receive good pensions. But the others, especially the elderly who are in what are known as Service towns, who live in close proximity to younger Service widows, drawing, in comparison, large pensions with no strings attached, have to shop in the same area and have to pay the same rents. These widows are very proud individuals who rightly feel aggrieved.
Year after year Ministers of both Parties have wept crocodile tears. I have read most of the documents through again and they have said that nothing can be done. I regret to say that a Conservative Minister for the Royal Navy also turned this matter down. We had a final reply from the Minister in this Government on 3rd May 1976. He said:
"…to do nothing, taken only with the greatest regret and for the very strongest reasons".
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That is why I say that they have wept crocodile tears. Surely if they really wished to do something they could do so.
I was interested to read in today's paper—and I do not mean this in any rude manner—that Members of Parliament are to receive another £4 a week. I suppose that this is for very strong reasons. I think there are very strong reasons for these elderly widows to be considered. It is stated that between 3,000 and 6,000 war widows die each year, and so there must be a saving of at least between £7 million and £8 million a year. In both 1973 and 1974 3,000 widows died. In 1975 6,000 died, so the Government are saving between £7 million and £8 million a year.
I realise that the probable cost would be about £100 million to bring these war widows in line with those whose husbands have been killed in Northern Ireland. However, this sum does not take into account the tax position because it is the gross figure to be paid out. In my view, it is unfair to discriminate against those whose husbands retired before 1950 or were killed in one of the two World Wars, by giving them £22 a week less than those whose husbands were killed in Service since 1966.
In the other House I was pleased to receive the backing and support of the present Foreign Secretary, who stated fairly that he had been Navy Minister and it was a severe disappointment to him that he had been unable to make the change. Later we had another Minister, Mr. Frank Judd, who also supported me. But he could not make the change. It has been stated that it would be necessary to consider other categories in the other Services; but there are already many anomalies in the situation in that officers and warrant officer Class 1 widows are eligible for a pension and have been for nearly 100 years. It is wrong that there should be discrimination between officers and other ranks. The matter should be looked into regarding its merits. I should like to draw that to the attention of noble Lords.
In the Plymouth edition of the Evening Herald of 21st June 1972, there was the headline: "No mite for the widow". In the article it was stated that in the terms of the Government's yearly budget,

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£1½ million to £3 million was a paltry sum and should be awarded. In recent years successive Governments have insisted on making comparisons outside the Service rather than in the Service. This pension that we are asking for is essentially a non-contributory pension scheme; in other words, a reward for service for the individual concerned. Nobody can say in this House that we do not get well served by the men and women of our Services.
It is worth remembering that the Prime Minister receives a pension, even if he is a Prime Minister for only one day. Judges, top civil servants, senior Service officers get substantial increases. No one is against—certainly I am not—people getting increases if they are merited; but it is only fair to look into the case of these war widows again to see whether there is a way of dealing with this situation. Surely with all the brains in the Government and behind them, with their advisers, there should be some way of getting over this difficult situation which has been going on since 1948.
Regarding the Bill, the first subsection of Clause 1 is clear. In subsection (2), in regard to payment, it is stated:
"Such pension shall be paid from the National Insurance Fund".
That is so for two reasons. The noble Lord who is going to answer me will know that first, because an individual Member of Parliament today may not introduce a Bill the main purpose of which is a money Bill. Should the Government wish to provide pensions from the Consolidated Fund or any other fund, so long as the pensions are paid it is immaterial from my point of view from which source they come. Also, because the defence budget is always being cut it might be easier to take it from some other fund.
Clause 2(1) sets out the category of widows; Clause 3 gives the power to the Secretary of State. Clause 5 gives the Secretary of State power to act by Statutory Instrument on any date he may choose—and I say, the sooner the better. The reason for Clause 5 is that one realises that this may not be the moment when the Government feel they can undertake this extra expenditure; but surely when we have been told day by day that the Government are getting over difficulties and that we are
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in for a millennium in the future, these people might have their share. This is why the date is left open and I hope that when the noble Lord comes to reply he will be able to give me not just a sympathetic answer but a positive answer "yes", not a positive answer "no", and that we will be able to help some of these people who are really in need. My Lords, I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a—(Baroness Vickers.)
6.12 p.m.
Lord BANKS: My Lords, I should like to congratulate the noble Baroness on introducing this Bill. I have listened with interest and sympathy to all that she had to say. In the debate on the subject of war widows which was initiated by the noble Lord, Lord Chelwood, on the 14th April last year, I said that I supported the principle of parity for war widows' pensions and would continue to press for its establishment at the earliest possible date, bearing in mind the present economic situation; so I welcome this Bill, which has precisely that aim in view.
Of course, I am aware that the Government have raised the war widows' pension paid by the Department of Health and Social Security in order that it may keep pace with inflation. They have maintained it at approximately 30 per cent. above the National Insurance social security level, and today for a private soldier's widow it stands at £19·80 per week, with additional allowances at age 65 and age 70. I am also equally aware of the anomalies in this field of war widows' pensions. We know that many thousands of the pre-1950 war widows, and of the 1950–73 war widows as well, need to have recourse to supplementary benefit. We know of the differences and anomalies as between the pre-1950 widows, the 1950/73 widows and the post-1973 widows.
I think there would be little opposition in this House to two propositions: first that the level—30 per cent. above the social security level—of the war widows' pension paid by the Department of Health and Social Security, and which is the only pension which many receive, is not enough. This is not a criticism particularly of this Government but of success

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ive Governments, of Parliament and of society generally. The second proposition is this: that it is not acceptable that war widows should receive in total Government funds pensions of widely differing amounts according to when they were widowed.
The forces family pension scheme introduced in 1972 and at that time made retrospective to 1950, and the revised and improved 1973 scheme, are paid and administered by the Ministry of Defence. It may not be reasonable to expect that those schemes should be made retrospective, but the Bill provides for the equivalent or supplementary pension required for pre-1950 and pre-1973 widows respectively to be paid from the National Insurance fund by the Department of Health and Social Security, presumably along with the basic war widows' pension available to all. Thus, a pre-1973 war widow would receive from the Department of Health and Social Security to add to the basic war widows' pension paid by that Department and to the pension under the family pension scheme, if she were entitled to a pension from that scheme, an amount to ensure that her total pension equalled that currently being received by the widow of a Serviceman of equal rank who retired on 1st April 1973. Such a person has her Ministry of Defence pension increased in line with the cost of living, so that it is more or less the same as the pension received by all those subsequently widowed whose husbands were of similar rank.
As the noble Baroness, Lady Vickers, has already said, in the debate on 14th April last year it was stated that the cost of giving parity to war widows would amount to £100 million, although, as she also indicated, the cost must get less as each year passes. It was pointed out that it would be necessary to include war disablement pensioners as well. It would be difficult to have different rates of pension for them if you got rid of different rates of pension for war widows. It was stated that that would bring the cost to £250 million. The Bill does not include the war disablement pensioners, and perhaps if it were passed the Government would feel obliged to introduce further legislation to do the same for them. One hundred million pounds or £250 million are not enormous sums these days, but we all know that in present circumstances the Govern
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ment would understandably argue against any further expenditure; but the provisions in the Bill would not come into force until the Secretary of State so decided. If the Bill were passed into law, there would not necessarily be any immediate expense, but the principle of priority would have been established, and for that reason I hope the House will give the Bill a Second Reading.
6.18 p.m.
Baroness YOUNG: My Lords, I, too, should like to congratulate my noble friend Lady Vickers on introducing this evening this short but important Bill and to support it. I do so not only after listening to her speech but to the very constructive one from the noble Lord, Lord Banks. I come relatively new to this subject, but of course I have read with great interest what the noble Baroness, Lady Vickers, said in another place in 1972 and reread the debate which took place in another place in May of this year. Looking at the situation as a whole, it seems to be quite extraordinary that widows of Servicemen should fall into these three distinct categories, their pension depending entirely on the date on which their husband either retired or died. It must be something quite different from any other form of pension scheme anywhere, and I think it must be unintelligible and unkind to the widows involved.
I do not wish to repeat the arguments for supporting this short Bill which have been so well set out, except to endorse very warmly the last point made by the noble Lord, Lord Banks, which seems to me to commend this Bill to the House. It does not commit any immediate expenditure of money, but it establishes a principle of parity. On rereading all the debates, it seems to me that there is no difference between the political Parties on this matter, in the sense that everybody wishes to do something for the widow. Everybody seems to have been unable to do anything for her and of course, the real sufferers are the widows, particularly the most elderly, whose plight is referred to at regular intervals but for whom nothing is done. I should like to look at the arguments which have been adduced from time to time against doing anything, leaving aside the economic argument which I think is quite a different one.

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So far as I can ascertain on rereading the arguments put out by Government Ministers of both Parties, we are never sure of the total number of widows of those Servicemen who retired below the rank of warrant officer before 1950. So far as I can see the latest figures were given by the late Sir Peter Kirk on 2nd August 1972 when he estimated that there were 30,000 widows involved. This figure was again quoted on 3rd May 1976 by the Minister, the present Under-Secretary of State for Defence, Mr. Duffy, who said it was not a reliable figure.
I find it quite extraordinary that although we collect information on so many subjects—even collecting information from a census, apart from anything else—that we cannot get accurate figures for the numbers of widows who fall into this category. I find it a very depressing sidelight on the whole of our Welfare State that we should be unable to get accurate figures on the matter so that we are unable to have an accurate costing. I should think that this would be a matter which should be looked at urgently. I can quite understand that the total number of widows of Servicemen who retired before 1950 could well be rising, because that particular group would be getting older and therefore there would be more widows; but ultimately it must be a diminishing number and therefore it should be possible to calculate the final cost.
The second reason which is always put forward for not doing anything at all for war widows is that it would create a precedent and that if we looked at these groups of widows, particularly the pre-1950 group, we should have to look immediately at the widows of teachers and local government officers and of many other groups. I think we can make out a very good case for looking at the widows of all those groups, but we are not concerned with them at the moment. The inequity arises also because widows above a certain rank get something and widows below it do not. Whether or not that is right for widows of teachers or local government officers, by no stretch of imagination can it be right for widows of Service people; and I find it quite wrong to go on quoting other examples to show why this cannot be done. We were always told that nothing could be done for the
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over-80s, but eventually it was possible to bring in a special pension for them. I believe that if there was a will to do so, it would be possible to find a solution in this case. That is why I hope this Bill will get a Second Reading, because its principle will then have been established.
The last reason which is always given, so far as I can see, as a sop to everybody's conscience is that widows of Servicemen, post-1973, are vastly better off. Of course, we are delighted that they are better off; so they should be. Nobody is going to detract in any way from anything that has been done for widows of recently serving men but, if I may say so, that is, in a sense, irrelevant to the argument. We are not trying to establish that they should be better off still; we are simply trying to establish that other widows who are not well off should be as well off as those widows are today. That is the argument, so I hope that when the noble Lord, Lord Winterbottom, replies he will not tell us that we should all be very pleased with ourselves and give ourselves a pat on the back because post-1973 widows are all right. We know that and we are pleased about it, but we are not concerned about them for the moment: we are concerned about the others. I sensed, in a way, when my noble friend Lady Vickers read out the correspondence between my honourable friend Mr. Goodhart and the Prime Minister, if I understood her correctly, that he, too, was using the argument, not that we need not concern ourselves with the others, but that we should be pleased that things are better for present-day widows.
I believe that argument to be quite irrelevant to the case and one which simply confuses the issue, because if it is going to be used as an argument we might just as well say to those elderly widows —many of them now living in very uncomfortable and unhappy circumstances "We are not going to do anything for you at all; you might as well make up your minds to the fact that until the day you die nothing is going to happen, because the three arguments that are constantly used can be argued about into the indefinite future. There is not a definite date on it. The only argument by which there could be a change is the economic one, if things get better".
I believe this to be a very serious matter, and I am delighted that my noble friend

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Lady Vickers raised it today. It has my warmest support, and I hope we can establish the principle that elderly people who have been, I believe, unjustly treated in the past should know that Parliament has determined that at a given date in the future they will get a better deal.
Baroness WARD of NORTH TYNESIDE: My Lords, before my noble friend sits down—she is in such an important position in our Party—may I ask whether she will then argue for this to be put into the Conservative Manifesto for the next General Election? I am sure she will agree with me—and I have myself done quite a lot over the years in matters of this kind—that it takes very many years, as we know from the problem with the over-80s, before the battle is won. Therefore, can we have an assurance that she will ensure that the matters that require attention are embodied in the Conservative Manifesto for the next General Election?
Baroness YOUNG: My Lords, I am always enormously flattered that my noble friend should think that I have only to say the word and anything would get into the Conservative Party's Manifesto. Alas! that is not the case, my Lords, much as I should like it to be. What I can say is that, as a matter of principle from all that I have said, we should establish that there ought to be equality of treatment. Having established that, when the economic circumstances are right, we could fulfil our pledge. I think that would be an important step forward.
6.27 p.m.
Earl CATHCART: My Lords, I am very grateful to my noble friend Lady Vickers for the opportunity given to us in this Bill to debate Service widow's pensions today. Service pensions of all sorts have grown up piecemeal over the years and there are now very many different groups and varying schemes. These schemes need our constant attention in order to try to reduce the many anomalies and inequalities caused by this situation. That is exactly what this Bill sets out do do. The time has come to tidy up Service widows' pension schemes by levelling the whole scheme step by step until eventually parity or equality is reached.
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For the most part, Service pensions arc governed by two principles: the first is based on service and not on contributions—that is to say, seniority, age and length of service of the individual when he retires. That principle is well understood and conforms with normal pension practice, whereby an individual's pension corresponds in proportion to his final rates of pay before he retires. The second principle of Service pensions consists of a series of artificial date barriers or cut-off dates, when the improved conditions and pay and pensions are announced—but only those serving on or after the selected date are eligible. That, of course, also applies to the widows' pensions. That not only causes misunderstanding and anxiety, but the older and earlier pensioners tend to fall behind, although in their day they and their husbands have given identical service.
As I have said, Service pensions are given for service and as increases are made to other pensions to cope with the rising cost of living, these pensioners fall behind. I think these cut-off dates are totally wrong, because prices in the supermarkets are high, and whether or not your husband retires after a certain date is immaterial. For those reasons I strongly support the principle of parity, as indeed do other speakers in this debate. I realise this has been debated many times and that many problems are involved. My noble friend Lady Young has outlined some of them. Nevertheless, these problems and difficulties must be overcome and we can no longer go on accepting excuses for doing nothing.
For these reasons, I prefer to see parity achieved not in one step, as this Bill proposes, but by a levelling forward process, step by step, until full pension parity is achieved. Also for this reason, I should prefer to see the Bill gain the Statute Book and then see results step by step, as we can afford to level forward. If parity was achieved and the jungle of varying scales, regulations and cut-off dates, which affect Service pensions, was finally ironed out of the system altogether, I cannot help wondering what would be the saving in civilian staff who deal with pensions. I believe that it would be enormous.
In my opinion, the most important proposal in this Bill is that pre-1950 service should count towards widows'

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pension, regardless of rank. At this point, I must say that I am probably the only person taking part in this debate who has a Service pension. But I am lucky, because I retired after 1st September 1973, and therefore am not personally affected by any arguments that I am putting forward—and I should like to discuss the husband's pension as well as the widow's pension—so that my motives, as your Lordships will appreciate, are not affected by that.
I did not think that I should find it necessary to remind noble Lords on the Front Bench opposite of the importance of social justice, but that is exactly what I intend to try to do now. How can you justify a pension scheme which allows pre-1950 service to count towards the pension of a widow whose husband was an officer or warrant officer class I, when the same service is not allowed to count at all if that husband was a warrant officer class II or below? The niceties of these regulations, and perhaps even the principles of these regulations, may be understood in the dusty corridors of the Treasury. But how can any responsible person or official explain such a crazy regulation to the unlucky widow, in any satisfactory manner or with any conviction?
To take the very worst case—and it is a hypothetical one—what can be the thoughts of two widows, one the widow of a warrant officer class I, the other the widow of a warrant officer class II, whose husbands both served in the same regiment and retired before 1st September 1950? What are their thoughts when they go shopping together in the supermarket, or buy clothes, because the disparity between their pensions is quite enormous and yet the disparity in their ranks is marginal.
This has often been debated over the years in another place; in particular, in the House of Commons on 2nd August 1972, the noble Baroness, Lady Vickers, initiated an interesting debate on this very point. It is, in my view, a matter of urgency to put right this stupid and unkind anomaly, and if this Bill achieves nothing else I hope it will achieve that. But I think that it is illogical to allow pre-1950 service to count towards a widow's pension, and not allow the same thing to happen to the husband who is living and has, after all, earned it. I realise that if that principle is accepted, the process of levelling forward
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may become more expensive and slower. But, nevertheless, I think that it is logical and we have to accept that fact. I hope, therefore, that this Bill will be given a Second Reading, and that the Minister who is to reply to this debate will assure us that the Government's aim and policy are to achieve equality of pensions, and that this will be done by levelling pension forward step by step, until parity is reached. I further hope that, as a first step in this levelling process, pre-1950 service will count towards the pensions of all ranks and not only those of the more senior ranks in the Services.
6.35 p.m.
Lord WINTERBOTTOM: My Lords, may I say at once to the noble Baroness. Lady Vickers, and to those Members of your Lordships' House who have spoken in support of this Bill. that the Government fully recognise the strength of feeling in this House, and indeed in another place, about the pre-1950 widows who are clearly at the heart of what is proposed to be done. The noble Baroness, however, spoke about crocodile tears from Ministers. She will get no crocodile tears from me, but I hope that she will get a reasoned argument which will help her to understand the problems that face any Government of whatever political complexion.
This Government—and, indeed, the previous Government —share the very widespread sympathy which has been expressed over many years for these ladies. We accept that an inequity of treatment resulted from the rules which existed up to a quarter of a century ago. If, today, we were constructing an occupational pension scheme for any group of employees, it would be quite unthinkable to include a rule that no one below a certain rank or grade could possess a contingent entitlement to a pension for his widow.
At this point, I should like to clarify a small semantic point in our discussion. This Bill relates to Service widows. and the definition of a Service widow is a widow of a Regular officer or Serviceman who is eligible for pension from the Armed Forces Pension Scheme. which is, in fact, an occupational pension scheme. The war widows, about whom the noble Lord, Lord Banks, talked, are those ladies whose husbands, whether Regular

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Servicemen or not, have been killed in the course of duty. They receive pensions from the Department of Health and Social Security, regardless of the length of their husbands' service. I hope that noble Lords will keep in mind this distinction between the occupational scheme and the scheme which covers the needs of war widows.
In the case of the Services, this disparity in provision was amended when, with effect from 1st September 1950, the new Armed Forces Pension Scheme prescribed—among several other improvements—that all ranks could earn a widow's pension if they gave long enough service. That is clearly an occupational pension scheme. Even then, there was something of rank distinction among non-commissioned officers and men: for corporals and below, the minimum period for qualification was 32 years; for sergeants it was 27 years. That was put right a few years later, when all non-commissioned ranks became pensionable at 22 years.
To put this development in perspective, it might be worth remembering that the widows of officers first received pensions in 1707, and the widows of warrant officers Class I received pension in 1881. That explains the situation described by the noble Earl, Lord Cathcart, of the WO1's widow and the WO2's widow shopping side by side. We are talking about the historical development of pensions for the Armed Forces. It may not be just, but it is fact.
So the year 1950 marked, in this respect, a significant improvement, but—as this Bill reminds us yet again—there are many Servicemen's widows still alive, whose husbands died or were discharged before the new pension scheme came into operation. We do not know how many there are now, or how many more there will be. Our records do not show how many men in 1950 had died or had been discharged without this contingent entitlement. Nor do we know how many of them have since passed away and how many remain, and whether they had been married while still serving.
Some years ago, an assumption was made—and it was no more than that—on the best information available, that there were about 30,000 such widows. In subsequently looking at the problem,
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we have assumed, in the absence of any more realistic figure, that there are still about 30,000; not that this takes us a great deal further, because the basic Armed Forces Pension Scheme, like most occupational pension schemes, relates to the husband's rank and length of service.
Baroness YOUNG: My Lords, I am sorry to interrupt the noble Lord, but before lie leaves the point about figures can he tell the House whether or not his Department is taking any steps to get a more realistic figure, so that we may all know precisely the number of widows that we are talking about? Perhaps the noble Lord could write to me.
Lord WINTERBOTTOM: My Lords, I was coming on to that point. This figure does not take us a great deal further, because the basic Armed Forces pension scheme, like most occupational pension schemes, relates to the husband's rank and length of service, but the numbers clearly are likely to prove considerable and the cost of now paying pensions on the basis proposed would therefore be significant.
May I now try to answer the question asked by the noble Baroness. If something were to be done for these widows, it would be a matter of advertising and inviting them to make themselves known. So the answer is that the number could be found out, if such a decision were made. It is not a mystery. The number could be found out by advertising, although that would in no way ensure that all widows had been reached. Some, no doubt, are now resident abroad. Nevertheless, despite the administrative difficulties which could be foreseen, various possibilities have been examined from time to time, and in great depth, to see whether anything at all could be done towards amending the inequity which so obviously exists without creating further anomalies —this is an important point—and without creating a sense of unfairness among other groups of former public servants and their widows. Reluctantly but inevitably, the conclusion has been reached with every investigation that the obstacles have been insuperable.
It must be recognised that in the pre-1950 years the concept of pensions for the widows of officers and certain warrant officers was in advance of its time. There

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were no such arrangements for the widows of civil servants, local government officials, teachers and other public servants. Junior ranks of the Armed Forces were on a par with all these in this respect and all, at about the same time, began to qualify under the new provision being made for widows' pensions. Thus, the previously existing inequity was not solely between Service officers and Servicemen; it was also between Service officers on the one hand and, on the other hand, Servicemen and all grades from the top to the bottom of the civilian public services. Therefore, any move now to give pre-1950 Servicemen's widows some form of pension would logically—and I am certain that both noble Baronesses are logical people—have to be accompanied by similar concessions to all public service widows. This in turn would make the whole proposition very much more expensive.
But I have yet to refer to the fact that the terms of the Bill we are speaking about go a long way beyond giving to these pre-1950 non-commissioned ranks' widows pensions on the same basis as those received by pre-1950 officers' widows. It seeks to give parity for these widows with the widows of a much more recent period and linked to the very significant effective date of 1st April 1973. This is a very different thing from remedying an inequity; it proposes to give these widows an advantage which it makes no attempt to extend to pre-1950 officers' widows. We are now speaking in this Bill purely of NCOs and other ranks, not of officers.
In its second clause, the Bill goes still further and offers to non-commissioned ranks' widows of the period between 1950 and 1973 the same degree of parity. This is a group on whose behalf there can be no justifiable complaint about their having been treated in principle less favourably than officers' widows of the same period. It is true, as I have already said, that there were certain improvements after 1950 which brought periods of qualifying service more closely into line, but one is forced to the conclusion that this second clause is a consequential of the overgenerous provision proposed to be made in the previous clause and could not in any way stand on its own merits. Again it propounds a degree of additional benefit for non-commissioned ranks' widows without indicating a correspond
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ing supplement for the widows of officers.
I referred to the date for which parity is sought—1st April 1973—as being very significant. On that date was introduced a package of improvements to the Armed Forces Pensions Scheme. Among the improvements was something quite new: the provision of greatly enhanced benefits when the disablement or death of a member of the Armed Forces is attributable to service. It is therefore the intention of the noble Baroness's Bill to extend these more generous arrangements to all non-commissioned ranks' widows, but not to those of officers, if their husbands were killed while on duty at any time in the past.
This brings me to yet another consequential of any change in the long-established principle, of which your Lordships are well aware, that improvements in occupational pension schemes are not applied to those, or to the widows of those, whose service has already terminated. It would be manifestly impossible to accord the kind of parity which the Bill proposes to Servicemen's widows without giving similar parity in disablement pensions. It would no doubt be argued that this would be a good thing, save for the prohibitive cost, and I think it has been argued today. I am bound to add that once the principle of non-retrospection has been breached in any respect—and the intention of the Bill is to breach it subsubstantially—there is virtually no defence against further inroads by other groups from the public sector. An obvious target would be to extend the parity of the arrangements now proposed to a current date; this is, in fact, what most of the many suggestions which are made aim at from the start, for there is little logic in settling upon 1st April 1973 other than to embrace the pensions improvements which then came in. If I correctly understood the noble Earl, Lord Cathcart, he was trying to avoid this problem. He was trying to avoid the principle of non-retrospection by jogging forward rather than by jogging backward. May I ask the noble Earl whether I am right about that?
Earl CATHCART: My Lords, the noble Lord is absolutely right.
Lord WINTERBOTTOM: My Lords, this is an important point which I think

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could well be considered. Now I turn to the suggestion that the proposed benefits should be paid out of the National Insurance Fund. I should like first to remind noble Lords of the origin and purpose of that Fund. It was set up under the National Insurance Act 1946 to receive the contributions payable by employers and insured persons, and to meet the costs of paying National Insurance benefits. There have been many changes since then and the Fund now operates under the Social Security Act 1975; but the purpose is still essentially the same. It really would be altogether inappropriate to finance Servicemen's occupational pensions out of it.
All benefits under the 1946 Act were payable out of the Fund, but some benefits under the 1975 Act are not. Those which are not payable from the Fund are the non-contributory benefits, such as attendance allowance and mobility allowance. Parliament generally, as well as noble Lords, I believe, on both sides of the House, have long recognised that the National Insurance Fund exists to provide insurance benefit to the whole working population.
This Bill is designed to benefit certain widows of Servicemen. All benefits presently payable out of the National Insurance Fund are available to contributors, or their dependants, when the appropriate contingency occurs, if they are part of the insured population, and distinctions are not drawn between differing occupations. It would be unfair to contributors as a whole to use the National Insurance Fund for the benefit of one particular occupational group. National insurance widows' benefits are already available to the widows of retired Servicemen on the same terms as to widows of other contributors.
The widows of men who died during or as a result of service in the 1914–18 war and during or as a result of service since 1939 may receive war pensions. These recognise the unusual risks of active service, and also the fact that the industrial injuries benefits are not available to Servicemen and their dependants. In keeping with the principles I have outlined, these war pensions are not paid from the National Insurance Fund but from funds voted by Parliament. So I have explained why, on grounds both of principle and of
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cost, we are regrettably unable to put right what has been recognised as an anomaly, affecting not only the widows of certain Servicemen but also the widows of former public servants.
I hope that the noble Baroness, Lady Vickers, will feel that her purpose will have been served by drawing the Government's attention to these widows and that no further purpose would be served by proceeding with her Bill. However, I can assure her that we shall not vote against her Bill on Second Reading.
Baroness VICKERS: My Lords, may I thank the noble Lord for his reply. So far as I can make out, it is a rather Alice in Wonderland situation. Obviously I cannot be very satisfied with the noble Lord's reply, but I am grateful to him for saying that the Government do not intend to vote against the Bill on Second Reading.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

TOWN AND COUNTRY PLANNING (AMENDMENT) BILL
6.50 p.m.
Report received.
Clause 1 [Stop notices]:
Lord LYELL Lord LYELL moved Amendment No. 1:
Page 1, line 7, leave out from ("Where") to end of line 8 and insert ("in respect of any land the local planning authority—

(a) have served an enforcement notice requiring a breach of planning control to be remedied; but

(b) consider it expedient to prevent, before the expiry of the period allowed for compliance with the notice, the carrying out of any activity which is, or is included in, a matter alleged by the notice to constitute the breach,")

The noble Lord said: My Lords, it may be for the convenience of the House if I speak also to Amendments Nos. 2 and 3 on the Marshalled List. It will be recognised that this series of Amendments is the result of discussion at the Committee stage in your Lordships' House on an Amendment which was tabled by the noble Lord, Lord Foot. Amendment No. 1 raised the question of whether the Bill itself should do any more than spell

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out matters to which the local planning authority should have regard when it considered whether or not to take stop action supplementary to enforcement action.
Before taking any enforcement action the local planning authority is required to consider whether it is expedient to take the action, having regard to the provisions of the development plan for the particular area and also any other material considerations. When the local planning authority has taken that action there is no obligation on the persons upon whom the notice has been served to cease their activities until the notice has come into effect and the period for compliance has expired. It is only then that it becomes an offence to continue the particular activity specified in the stop notice. I understand it is still considered that both under the existing Section 90 of the 1971 Act and under the new Section 90 that we substitute in the Act under this Bill, the local planning authority has to exercise a further discretion before serving a stop notice. I think everyone accepts that this calls for criteria of expediency which are different from those which apply when taking enforcement action.
Therefore, Amendment No. 1 draws attention to the need for the local planning authority to make the additional and separate decision as to whether it is—in House of Lords terms or even in Biblical terms—expedient to secure by the stop notice procedure the cessation of activities as a whole or just one or more particular activities, and by obtaining a stop notice to terminate this particular activity more speedily than could have been done under the associated enforcement notice. That is the purpose of Amendment No. 1 and Amendments Nos. 2 and 3 are consequential upon that. I beg to move.
Lord AIREDALE: My Lords, I have been asked by my noble friend Lord Foot, who moved Amendments at the Committee stage, to express to your Lordships his apologies for being unable to be present this evening. He asked me to thank both the noble Lord in charge of the Bill and the Government for the fact that we have before us this evening Amendments which, in the words of a note which I have from my noble friend,
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"… go some considerable way towards achieving what my original Amendments were intended to do".
Lord HALE: My Lords, as I spoke on the first Amendment at the Committee stage, I should like to echo those words. I have nothing to add, except to felicitate the noble Lord, Lord Lyell, on the clarity with which he has dealt with this matter and on the steps he has taken to meet very fairly the points that were raised.
Baroness BIRK: My Lords, on behalf of the Government, I should like to support these Amendments. I am grateful for the amount of work that has been put in by the noble Lord, Lord Foot, to try to reconcile the different views that were expressed, and by the noble Lord, Lord Lyell, who has worked very hard and made it possible for us to find the accommodation which at Committee stage I hoped it would be possible to find.
On Question, Amendment agreed to.
Lord LYELL Lord LYELL moved Amendment No. 2:
Page 1, line 14, after ("out") insert ("of that activity").
The noble Lord said: My Lords, I have already spoken to this Amendment. I beg to move.
On Question, Amendment agreed to.
Lord LYELL Lord LYELL moved Amendment No. 3:
Page 1, line 15, leave out from ("notice") to end of line 18.
The noble Lord said: My Lords, this is consequential upon the two earlier Amendments. I beg to move.
On Question, Amendment agreed to.
Baroness VICKERS Baroness VICKERS moved Amendment No. 4:
Page 2, line 7, at end insert (" or
(d) the use of land as a caravan site by a travelling showman who is a member of an organisation of travelling showmen which holds for the time being a certificate granted under paragraph 10 of the First Schedule to the Caravan Sites and Control of Development Act 1960 and who has taken up winter quarters on the land with his equipment for some period falling between the beginning of October in any year and the end of March in the following year;").
The noble Baroness said: My Lords, in moving Amendment No. 4, I have to point out that there is an error on the Marshalled List. It should read, "Page 2, line 10" and not "line 7". Unfortunately, like the noble Lord, Lord Foot, the noble Lord, Lord Brooke of Cumnor, is not able to be here today. Your Lordships may remember that he moved an Amendment on these lines at the Committee stage, but that Amendment was not accepted. We have changed the wording of the Amendment in the hope of perhaps making it a little clearer. If these words are accepted, the showman would then be identified in paragraph 10 of Schedule 1 as:
"… a member of an organisation of travelling showmen which holds for the time being a certificate granted under paragraph 10 of the First Schedule to the Caravan Sites and Control of Development Act 1960",
and the showmen's guild would of course hold the certificate. The show men would have taken up winter quarters on the land for some period falling between the beginning of October and the end of March of the following year. When looking through Hansard, one of the points that struck me was that both the noble Lord, Lord Lyell, and the noble Baroness, Lady Birk, made the point that to exempt showmen would be to discriminate in their favour because other persons carrying on business in conjunction with their caravans would not be covered. In my view that point is mistaken because the showmen do not carry on any business in their winter quarters as opposed to scrap dealers and others. The showmen merely park their equipment with their caravans, and they have to do that for security reasons alone. If they are not able to look after their equipment in this way, they suffer considerably from vandalism.
The noble Lord, Lord Lyell, and the noble Baroness, Lady Birk, were therefore wrong, I believe, in suggesting that the showmen would be using their equipment during the winter months, although I am glad to say they stated that showmen did not usually cause severe damage or nuisance or offence to other amenities. If the noble Lord, Lord Lyell, cannot accept this Amendment, I wonder whether the noble Baroness, Lady Birk, could say whether instructions could be sent to local authorities, telling them about the
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importance of these showmen having some form of site, because one knows that some local authorities—perhaps quite rightly—are over-zealous in their attitude towards these travelling showmen. I hope this Amendment can be accepted. But, if it cannot, I wonder whether the Department would be prepared to include in their regular circulars to local authorities advice to the effect that travelling showmen face special difficulties with their vehicles in winter quarters and, as the debate on 21st June made clear, travelling showmen would not normally be included in the category of persons who caused severe damage or nuisance which would justify a stop notice against a vehicle. I beg to move.
The Earl of KINNOULL: My Lords, I should like briefly to support my noble friend Lady Vickers. She has moved an Amendment which is slightly different from the Amendment moved at the previous stage of the Bill. I must say I was particularly struck by my noble friend Lord Brooke's Amendment, and indeed the advice he gave to the Committee that what this Bill was doing was taking out the special provision of the 1960 Act specifically giving support to the travelling showman. I have not yet heard any reason why it should be withdrawn. I do not know whether my noble friend is able to accept this Amendment at this stage. If my noble friend Lord Lyell cannot accept this Amendment, I would support Lady Vickers' plea to the Government that they should give some undertaking at this stage to try to allay the undoubted anxiety of those outside the House.
Lord HALE: My Lords, I rise only to associate myself with the admirable speech made by the noble Baroness and with the support given by the noble Earl. This class of people of course has a special affection in the hearts of some of us, if not in the hearts of all local councils. The modification the noble Baroness has made, the redrafting and narrowing of the clause moved on the last occasion by the noble Lord, Lord Brooke, has gone quite a long way to removing any theoretical objections which were made in the course of the debate. I am not sure whether it is in order to remind your Lordships that on the last Division the Amendment of Lord Brooke was defeated

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by a single vote, and I think rather surprisingly. It would be an action much in the spirit in which this Bill has been moved if this Amendment, relatively small, applying to a special class under special circumstances, were conceded without argument.
Lord LYELL: My Lords, first of all I should like to thank my noble friend Lady Vickers, and indeed the noble Earl, Lord Kinnoull, and the noble Lord, Lord Hale, for their contributions, and particularly for the clarity with which my noble friend spelled out her Amendment. This particular Amendment is similar—although it is redrafted, and for the purposes of the Bill it is milder—to the Amendment moved at art earlier stage by my noble friend Lord Brooke of Cumnor. This was aimed at trying to secure that travelling showmen should have special exemption from this stop notice action I am proposing in the Bill in respect of the storage and the parking, to use that term, of their equipment on any land which is being used as winter quarters, but as well as that protection which is afforded them by Clause 1 in respect of land used as a caravan site.
There is one awkward aspect to the Amendment. It is extremely doubtful whether the Amendment achieves the particular object which I think the whole House, and in particularly the noble Baroness, Lady Vickers, wish to achieve, since the Amendment expresses the exemption as applying to,
"the use of land as a caravan site".
When we look at the Caravan Sites and Control of Development Act 1960, we find the meaning of the term, "caravan site"; it means,
"… land on which a caravan is stationed for the purposes of human habitation and land which is used in conjunction with land on which a caravan is so stationed".
As we understand it, this Amendment does not cover the circumstances envisaged by the noble Baroness, Lady Vickers. There are two points which I should like to make. By the Amendment which we have just made to Clause 1 and the Amendments which are to follow, we hope to clarify the Bill's provisions with regard to the service of any stop notice, and indeed the effect of the 12-month limitation which is set out in subsection (2)
1300
of the new Section 90 in Clause 1.
Where the authority consider that there has been a breach of planning control, they may in the normal run of events serve an enforcement notice, and when they do this they have to take account of the criteria set out in Section 87 of the Act. If, having done this, they consider it expedient in the public interest to go further—and that would probably be in reply to pleas from individuals or groups in particular areas of the countryside—and to stop the use of one or more particular activity more quickly than would be possible under the enforcement procedure, then they are entitled to serve a stop notice.
Secondly, if the later Amendments are accepted, we shall find that the travelling showman would be covered, in that if he has used any land as winter quarters on any one occasion more than 12 months previously, then, like anyone else, he will be protected from the stop notice action in respect of using that land as winter quarters. He will be outside the scope of the Bill. Cases have been cited eloquently, both at this stage and at the earlier stage, by the noble Baroness, Lady Vickers; the noble Baroness, Lady Bacon, also expressed strong support for the showmen, saying how responsible they were. We believe that the showman would not be subject to the stop notice action if he had used land as winter quarters for at least the previous winter season.
Special provision has also been made in other enactments for travelling showmen to be able to use land for the stationing of their caravans for the purpose of human habitation; that is, for parking their own residential caravans. We hope that this Bill carries forward this principle by ensuring that they certainly cannot be made homeless at short notice. All of us know, responsible organisations such as the Showmen's Guild know, that under the system of planning control we have at the moment neither ownership nor the owner's permission to occupy land for any purpose—even leaving their equipment dormant and inactive over the winter season—frees the owner of the equipment from the requirement of obtaining planning permission if permission for such use is required.
All of us in your Lordships' House are aware that members of the Showmen's

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Guild aim to comply with all the laws relating to the use of land for any purpose, whether for setting up a funfair or for using the land as quarters. I appreciate, and I believe the Government appreciate, that they will face a particular problem if traditional winter quarter sites are lost, through redevelopment or rezoning, or possibly through objections that the site has become too crowded and there are too many caravans on the one site. Therefore, it might become unsuitable, too crowded and cause a particular problem to neighbours.
I believe that when such a thing happens it is incumbent on showmen—and particularly the Showmen's Guild of Great Britain—to do their best to ensure that even if all the normal planning procedures cannot be completed in the time available—and I believe that with such a responsible organisation there will not be much difficulty between the Showmen's Guild and the planning authorities—they will be able to make their peace with the particular planning authority over any emergency use of a new site if they have lost the original site.
I want particularly to assure the noble Baroness, Lady Vickers, that there are already safeguards in the Bill against showmen being separated from their equipment at short notice. First, where a traditional site for showmen is lost, the local planning authority should be consulted quickly. I believe that that local planning authority will give urgent consideration to any difficulties that might arise through the traditional winter quarters being lost for any reason.
Secondly, Amendment No. 1, which is in my name and which the House has accepted, deals with the local authority and, above all, with the expediency of issuing a stop notice in relation to any activity. The consideration as to the issue of such a notice is entirely separate, and I believe that in practice it is more exacting than the consideration of an enforcement notice, which has much broader application.
Finally, where showmen, and especially the Showmen's Guild, adopt the attitude which was envisaged by the noble Lord, Lord Brooke of Cumnor, and the noble Baronesses, Lady Vickers and Lady Bacon, at an earlier stage, I can see no
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difficulties for showmen as a result of my Bill. I do not think that this is likely to be the only type of case in which there may be such a close link between activities which are immune from stop action and others which are not.
The noble Baroness, Lady Birk, promised in previous stages of our debate that guidance would be given to local planning authorities on the exercise of these powers. I think it is likely that the Department of the noble Baroness would be ready and able to cover the point in a general way without making a special case for any class of person. As the noble Baroness, Lady Vickers, pointed out, it is not the carrying on of a business which is specially at issue in the Bill, although I know that it is mentioned; it is the parking and the obstruction which could be caused by a great number of caravans in a place which had started as a fairly small winter quarters site for perhaps a family. A different chain of circumstances could arise where a large number of caravans and other families of showmen might wish to use a particular site. In that case I believe that further consultations would be required between all the showmen on the site and the local planning authority.
I hope that the noble Baroness, Lady Vickers, will be able to consider the points and the safeguards that I have mentioned. I do not believe that there is any great ground between us on the question of showmen and how they will be treated as a result of the enactment of the Bill. I hope that I have stilled her worst fears and even her minor fears. As it is at present drafted, Amendment No. 4 will not achieve what the noble Baroness has in mind. Therefore, I cannot say that I can accept it.
Baroness BIRK: My Lords, the noble Baroness, Lady Vickers, put her Amendment extremely fairly. She acknowledges that there are problems about it. The noble Lord, Lord Lyell, has also clearly explained at some length—and I shall not go over it again—why the Amendment does not do what the noble Baroness, Lady Vickers, wishes. A great many of her fears should have been assuaged because other Amendments have been moved and carried, and the point about the 12 months has been dealt with.

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The noble Baroness made a specific point to me about the circular. I can certainly assure her that the circular will give advice along the lines that the noble Lord, Lord Lyell, has suggested. Perhaps I can give the gist of it, although these will probably not be the words used:
"In some cases in which a stop notice could be served in respect of an activity which is so closely connected with another which is immune from stop notice action, there would need to be special justification for a service of a stop notice".
I should have thought that that, together with all the points and safeguards that were mentioned by the noble Lord, Lord Lyell, covers the point. I hope that the noble Baroness will agree that it does. I entirely support the noble Lord, Lord Lyell, on this. Beyond this we cannot go because we should then find ourselves in the area which both the noble Lord and I vigorously opposed in Committee. I hope that that covers the points made by the noble Baroness so that she will accept my remarks and withdraw her Amendment.
Baroness VICKERS: My Lords, with the leave of the House, may I thank the noble Baroness and the noble Lord, Lord Lyell, for their explanations. I cannot say that I am entirely satisfied, but when the showmen read it perhaps it will ease their minds a little. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
7.17 p.m.
Lord LYELL Lord LYELL moved Amendment No. 5:
Page 2, line 11, leave out ("an activity being carried out on land") and insert ("the period during which an activity has been carried out on land (whether continuously or otherwise)").
The noble Lord said: My Lords, with the agreement of the House, perhaps I could discuss Amendments Nos. 5 and 6 together. These two Amendments are the result of doubts which were expressed at an earlier stage in Committee as to whether the wording the clause precluded a stop notice being served in respect of occasional or seasonal activities on any land which first took place more than 12 months earlier. The Amendments do no more than explain the original intention, but the insertion into the clause of an explicit reference to the continuity or otherwise of an activity removes any room for doubt, and that is what we seek.
The first Amendment makes it quite clear that the stop notice may not be served in relation to occasional, intermittent or seasonal activity which is being carried out on the land if that activity first began more than 12 months earlier. The second Amendment is a purely consequential drafting Amendment. I beg to move Amendment No. 5.
On Question, Amendment agreed to.
7.19 p.m.
Lord LYELL Lord LYELL moved Amendment No. 6:
Page 2, line 13, leave out ("continuing") and insert ("carrying out").
On Question, Amendment agreed to.
Lord LYELL Lord LYELL moved Amendment No. 7:
Page 3, line 33, at end insert—
("(10) Any reference in this section to the period allowed for compliance with an enforcement notice shall be construed in accordance with section 89(6) of this Act.").
The noble Lord said: My Lords, perhaps I could speak to Amendments Nos. 7 and 8 together. These, again, are purely drafting Amendments which we have made in order to meet some arguments which were made at an earlier stage. Subsection 4(b) of Section 90 of the 1971 Act, which is set out in Clause 1 of the Bill, provides for a stop notice to cease to have effect at the end of the period allowed for compliance with the enforcement notice and not, as hitherto, when the enforcement notice takes effect.
It is necessary to have a provision explaining what this phrase means because the local planning authorities have the power under Section 89(6) of the Act to extend the period for compliance. At present Clause 1(2) achieves this simply by adding a reference to Section 90 in Section 89(6) of the Act, where the phrase is defined for the purposes of Section 89.
The noble Lord, Lord Foot, pointed this out in Committee, and he stressed particularly that this was less convenient to people who might be using the Bill than would be a provision which defined the phrase separately for the purposes of Section 90. These two Amendments meet that point. The present Clause 1(2) is replaced by a provision inserting a new subsection to Section 90 of the Act, which is set out in Clause 1, providing that any reference in Section 90 to the

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period allowed for compliance with an enforcement notice shall be construed in accordance with Section 89(6) of the Act. That is complicated. I apologise to the House. I beg to move Amendment No. 7.
On Question, Amendment agreed to.
Lord LYELL Lord LYELL moved Amendment No. 8:
Page 3, line 34, leave out subsection (2).
The noble Lord said: My Lords, I have spoken to this Amendment, and I beg to move.
On Question, Amendment agreed to.

DEER BILL [H.L.]
7.21 p.m.
Lord NORTHFIELD: My Lords, I beg to move that this Bill be now further considered on Report.
Moved accordingly, and, on Question, Motion agreed to.
Clause 18 [General exceptions]:
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 47A:
Page 8, line 41, leave out ("the deer was causing, or had caused, serious") and insert ("deer of the same species were causing, or had caused").
The noble Lord said: My Lords, since we considered this matter some days ago my noble friend Lord Northfield and the Government have been able to discuss a number of outstanding matters. It might be helpful if I were to say at this stage that there is almost complete agreement between my noble friend Lord Northfield and the Government on the majority of the Amendments put down. As all of your Lordships who are present know this Bill from front to back and, if I may say so, from back to front, I would think it is unnecessary for me to move certain Amendments at any great length.
With your Lordships' permission I should like to speak to Amendments Nos. 47A and 49A. These Amendments make some changes in the conditions which must exist before farmers and other occupiers may be permitted to shoot deer in the closed season or at night in defence
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of their crops or other properties. The changes being made by these Government Amendments to Clause 18(6) correspond precisely to the modifications which my noble friend Lord Northfield has introduced in his revised version of subsection (7) in respect of the similar situation to which these subsections apply. I do not think I need to say any more. I beg to move.
Lord NORTHFIELD: My Lords, in supporting these Amendments may I briefly say two things: first, I should like again to thank the Home Office for their great attention to this Bill and for helping me redraft highly difficult sections of it. This has caused staff of the Home Office to be working late at night on more than one occasion. I am fully conscious of that and grateful for it. We have had our conflicts and our arguments, and almost our recriminations, but I am glad to say that, as my noble friend so kindly said, we have reached wide measures of agreement which are reflected in the Amendments on the Marshalled List. Nevertheless, may I say to my noble friend, secondly, that he knows and I know that at Third Reading there will be some small Amendments which are still under discussion, but I hope they will fall fully within the traditions of the House in that they will be in the nature of final tidying up of the Bill. I fully support what my noble friend has moved.
On Question, Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 49A:
Page 8, line 44, leave out from ("and") to end of line 45 and insert—

("(c) that there was a likelihood of further damage and that such damage was likely to be serious, and

(d) that his action was necessary for the purpose of preventing any further damage").

The noble Lord said: My Lords, I have spoken to this Amendment. I beg to move.
On Question, Amendment agreed to.
7.25 p.m.
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 50A:
Page 9, line 1, leave out subsection (7) and insert—

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("(7) A person shall not be guilty of an offence under section 3(1)(c)(i) of this Act by reason only of the taking or killing, or attempted taking or killing, of any deer by using—

(a) any smooth bore gun of not less gauge than 12 bore loaded with a cartridge containing a single non-spherical projectile weighing not less than 350 grains (22·68 grammes), or

(b) any smooth bore gun of 12 bore gauge loaded with a cartridge purporting to contain shot each of which is 203 inches (5·2 millimetres) in diameter,

on any land if he satisfies the court before whom he is charged—

(i) that he was an authorised person, and

(ii) that deer of the same species were causing, or had caused, damage to crops, vegetables, fruit, growing timber or any other form of property on that land, and

(iii) that there was a likelihood of further damage and that such damage was likely to be serious, and

(iv) that his action was necessary for the purpose of preventing any further damage.")

The noble Lord said: My Lords, I shall have to speak slightly longer on this issue. I should be grateful for the indulgence of the House if I may speak to Amendment No. 53 at the same time, and if I may mention Amendment No. 61A, which is the proposed new clause on the Advisory Committee. It cannot be excluded at this point although I shall want to say a further word when we reach it.
Here, we are reaching an issue which was hotly debated at Committee stage. It is the question of the weapons permitted for use by an owner-occupier largely against marauding deer. The original intention of the Bill was that the shotgun should be phased out in favour of the rifle. Some noble Lords at any rate indicated that it would not be acceptable to the farming community to make this transition so quickly. In the end, we reached a compromise which involves continued permission to use a shotgun in the circumstances set out in the proposed Amendment, provided the damage is shown as set out in the latter part of the Amendment. Later, the Secretary of State will, by means of Amendment No. 53, have power, either nationally or area by area, to proscribe and prescribe the appropriate weapons to be used against deer. The present Amendment then will make a full compromise with the farming community, provided that the third element—the existence of the
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Advisory Committee which in the course of its work will advise the Minister on this issue, among others—is included.
I want to say two or three things about it. I know that the noble Lord, Lord Stanley of Alderley, was most insistent on this issue at Committee stage and will accept from me that this involves leaving the status quo at the moment, with the inevitability, let us face it, of some considerable possibility of continued cruelty to deer by use of the shotgun. I accept this for a transitional period, but I hope that the noble Lord, in turn, will agree with me that the purpose of the years to come must be gradually to get the farming community to accept the phasing-out. They must be persuaded to accept the use of more appropriate weapons through a period of education, discussion, contact with their chief constable, and so on.
Having said that, let me say that this agreement is fully made with the National Farmers' Union. I am most grateful to the noble Lord, Lord Dulverton, who arranged for me, with him, to meet Sir Henry Plumb, the president of the NFU, with his vice-presidents. This became a package of compromise which the NFU confirmed in writing that they would be happy to accept, and, indeed, to support, provided that the whole thing is there. The package must include the powers of the Minister to act by order but with the possibility—indeed, the certainty—that the Minister will be advised by an advisory committee on which the NFU will be represented, with the possibility of course that if the Minister were to act too precipitately the farming community could make representations to the advisory committee and could finally oppose the Order in Council in Parliament if they were dissatisfied with the speed with which the matter was being dealt. I hope therefore that the whole procedure that is here suggested will commend itself to the House.
The noble Lord, Lord Stanley of Alderley, has put some questions to me in writing and I would say three things to him. First, we fully accept that the protection of farmers' crops is a very ligitimate activity and nobody wants to deny the farmer the possibility of that protection. Secondly, I hope that in this transitional period we will move without undue fear that chief constables will be

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too restrictive or unduly unwilling to give any firearms certificates that the Minister's final orders in years to come—when all this has been through a period of education to final action—may necessitate.
Thirdly, I have with me letters from chief constables from which I will read a couple of sentences. One of them is a very important chief constable, the chief constable of Devon and Cornwall, where I know there is great sensitivity on this issue, and he writes:
"I appreciate that while the effect of the Bill, if implemented in its present form, would increase the amount of applications by farmers for high-powered rifles, the problem is not a national one and no real difficulties are envisaged in dealing with future applications in this Force".
That must be reassuring for the farming community and I want it to be on record. The chief constable of the West Mersea Constabulary writes:
"In any event, provided the nature of the applications"—
that is, for a firearms certificate—
"were satisfactory, refusals would not arise. I know the concern expressed by the National Farmers' Union, but I think they have exaggerated the situation".
I do not want to level any charges whatever; I simply want to allay fears. I hope that after a period of transition, for which this and the associated Amendments provide, we shall in years to come reach a happy outcome, and I hope that that preliminary or advance assurance from two chief constables who have a considerable responsibility in this matter will reassure the farming community that this process of transition should begin and should not in the end lead to undue difficulties when it is completed. I beg to move.
Lord SWANSEA: My Lords, I entirely agree with the noble Lord, Lord Northfield, in what he said about hopes for the future and that chief constables will review their objections to issuing firearms certificates. If we continue to allow the use of shotguns we will be dragging behind other European countries in the humane control of deer; we will, I believe, be the only country in Western Europe still to allow the use of small shot in shotguns and we will still have the situation remaining of deer being wounded and undergoing intense suffering. I therefore
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also regret very much that it has proved necessary to retain the use of shotguns.
The proposed subsection (7)(b) refers to any smooth bore gun of 12-bore gauge and that, I feel, is rather too restrictive. I suggest it should be brought into line with the preceding provision so as not to allow any smooth bore gun of "not less gauge" than 12-bore. With the larger gauges one has the advantage of a larger shot capacity, which of course will produce a denser shot pattern and increase the chances of an effective kill. In the same subsection, where it specifies the shot size, it specifies only one shot size—"this shot shalt thou use and no other"—which I feel is rather too rigid. I suggest that it should be a minimum size and that scope should be given for the use of a larger size of shot. There are various sizes on the market and the larger size has greater striking energy, and so I suggest that there should be rather more scope in the choice of size of shot.
Lord STANLEY of ALDERLEY: My Lords, I wish at the outset to thank the noble Lord, Lord Northfield, for his remarks about farmers' crops and that they should be a prime consideration of the proposed committee. I very much welcome that. I think I should tell him that we farmers are normally a suspicious lot; we have to put up with the Almighty and his weather, but we also have to put up with politicians, who are far worse, and that is why I probably treated the noble Lord's Bill with a certain amount of suspicion.
As he knows, I am more than happy to accept this new provision in conjunction with the one he will move shortly concerning the proposed committee, and I know that the NFU is too, as he intimated. I must agree—as I have always agreed, even on Second Reading—that the rifle is a better weapon. We have discussed this at great length and I know the noble Lord accepts that at the moment we are not ready for it. I am sorry about that, but as we all know there are conditions of safety and the need for people to be educated before we can reach that stage. However, I accept that we should try to move that way.
The noble Lord mentioned a compromise. Your Lordships must realise that Lord Northfield has been a

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master of negotiation over the Bill. Frankly, I thought that we should never reach agreement. We have, and in my view a great deal of the tribute for that, indeed all of it, must go to the noble Lord.
The Earl of MANSFIELD: My Lords, perhaps it is in order for me to add a word of agreement and of congratulation to the noble Lord, Lord Northfield. Like all compromises, this one is less than perfect. I have been concerning myself throughout the passage of the Bill with the legal side of matters and I am still not entirely happy with the wording of his proposed Amendment. For instance, I am not sure that it will be easy to satisfy a court under paragraph (b)(ii) that one's nibbled turnip had been nibbled the previous night by deer of the same species as the next morning is lying dead. Perhaps a little more consideration could be given to this matter on Third Reading, because it is very nearly a nonsense. I am sure that with good will and slightly better drafting it could be made better.
So far as the use of the shotgun is concerned, I think that I agree with my noble friend Lord Swansea that paragraph (b) should be drafted so as to read "not less than 5·2 millimetres", rather than "of 5.2 millimetres". That would give discretion to the particular user of the shotgun who may happen to have shotgun cartridges of large size which would do the job just as well as those which have been prescribed.
I want to refer to the question of deer drives, which I do not think has been mentioned previously. It caused a great deal of thought and, possibly, confusion at an earlier stage. I think it excellent that this matter, too, will be left in the hands of the Secretary of State as advised by his Advisory Committee. The great merit of a compromise such as this is that it leaves the problem to be decided by those who have to make decisions in the light of the prevailing circumstances. The noble Lord has produced letters from two chief constables which give him solace, or at any rate satisfaction. I am not going to rock the boat more than to say that I have had letters from chief constables, who are perhaps rather nearer to urban areas or conurbations, who said that they would be worried by the issue of firearms certificates. I think that only
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time will show the Secretary of State how he is to operate it, and it may be that one area would be treated quite differently from another, not from the point of view of education or availability, but simply from the point of view of the number of people who happen to live in an area, and the desirability of letting off high velocity rifles within it. This is the merit of the Secretary of State making orders in the future, and as such I join with others in welcoming this compromise, and in congratulating the noble Lord, Lord Northfield, upon his considerable devotion to duty.
Lord NORTHFIELD: My Lords, I am most grateful for what noble Lords have said; they have been very indulgent in my weeks of negotiations. I should like to mention two points. I will gladly consider before Third Reading the point raised on paragraph (b). On sub-paragraph (ii), dealing with the same species question, I should say that this provision has been put in very recently, because noble Lords and others interested in deer were anxious to secure that there was some onus on the farmer to prove that in using the exemption provided here he is actually shooting at least something like the deer which had been causing the damage. The danger was previously that it was merely a case of deer having caused damage and he could take a pot shot at the red deer, even though a roe deer or some other deer had been causing the damage. This is simply an attempt slightly to narrow the circumstances in which the farmer can act, and I have put it in under pressure. Although I will consider the point of the noble Earl, Lord Mansfield, I hope that at Third Reading I can say that I have convinced him that we should stick to it, but I give an undertaking to have a word about this before Third Reading—
Viscount MOUNTGARRET: My Lords, I should like to raise a point with the noble Lord before he sits down. I apologise in that I have probably not been paying attention. In the Bill as it came through Committee, paragraph (c) of subsection (7) seems to have got lost in the Amendment by the noble Lord, Lord Northfield. I thought it was desirable that we should at this stage try to prevent any possibility of deer drives. Can the noble Lord reassure me on that point?
Lord NORTHFIELD: My Lords, as the noble Earl, Lord Mansfield, has indicated, it is part of the compromise that we do not at this point outlaw deer drives. This is part of the agreement with the National Farmers' Union. But I should point out that in Amendment No. 53, which we are discussing together with this Amendment, the Minister is given the power to prescribe conditions to be attached to the use of firearms or ammunition. That would enable him in the circumstances, and with restrictions that he would set out, to regularise deer drives in due course, after the advice of the Advisory Committee, and after talking with the NFU. That is the best we can do in the compromise that we have reached.
On Question, Amendment agreed to.
7.44 p.m.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 52A:
Page 9, line 21, at end insert—
("(7A) A person shall not be guilty of an offence under section 3(1)(c)(i) of this Act by reason of the killing or attempted killing of any deer by using, as a slaughtering instrument, any smooth bore gun which is of not less gauge than 12 bore, has a barrel less than 24 inches (609·6 millimetres) in length and is loaded with a cartridge purporting to contain shot none of which is less than 203 inches (5·2 millimetres) in diameter.").
The noble Lord said: My Lords, with your Lordships' permission, in moving Amendment No. 52A I should also like to speak to Amendments Nos. 63A and 68A. I do not think that there is any need for me to dwell at great length on this matter. These three Amendments are intended to resolve the problem of defining a slaughtering instrument for the purpose of the Bill. Noble Lords will appreciate that the second and third Amendments remove the definition of a slaughtering instrument from Clause 21 entirely, and transfer it to the reference to a slaughtering instrument in Schedule 2, where it is given the meaning given to it in the Firearms Act. The new subsection which forms the first of these three Amendments introduces the idea of a different form of slaughtering instrument; namely, the sawn-off shotgun, which satisfies the technical specifications set out in this new subsection. I beg to move.
On Question, Amendment agreed to.
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 53:
Page 9, line 21, at end insert—
("(7A) The Secretary of State may by order, either generally or in relation to any area or any species of deer specified in the order, repeal subsection (7) above or amend it by adding any firearm or ammunition or by altering the description of, or deleting, any firearm or ammunition mentioned in that subsection, or by prescribing the conditions to be attached to the use of any firearm or ammunition.")
The noble Lord said: My Lords, I have already spoken to this Amendment. I beg to move.
On Question, Amendment agreed to.
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 55:
Page 9, line 24, leave out ("authorised").
The noble Lord said: My Lords, this is a purely drafting Amendment. I beg to move.
On Question, Amendment agreed to.
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 57:
Transpose Clause 18 to after Clause 7.
The noble Lord said: My Lords, this is a drafting Amendment putting the clause to a more appropriate point in the Bill. I beg to move.
On Question, Amendment agreed to.
Clause 19 [Power to grant licences]:
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 58:
Page 10, line 10, leave out ("3(2)") and insert ("(Taking etc. of live deer)").
The noble Lord said: My Lords, with the permission of the House, I should like to speak to these two Amendments, Nos. 58 and 59 together. Both are drafting Amendments, consequent on Amendments that we made at an earlier sitting. I beg to move.
On Question, Amendment agreed to.
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 59:
Page 10, line 14, leave out ("3(2)(b)") and insert ("(Taking etc. of live deer)(a)").
On Question, Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 60:
Transpose Clause 19 to after Clause 7.
The noble Lord said: My Lords, your Lordships will see that this is a drafting Amendment. It merely seeks to put Clause 19 in the right order.
On Question, Amendment agreed to.
7.50 p.m.
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 61A:
After Clause 19, insert the following new clause:
Advisory Committee on Deer in England and Wales
.—(1) There shall be established an Advisory Committee on Deer in England and Wales, consisting of such members as the Minister of Agriculture, Fisheries and Food may from time to time appoint and particularly including nominees of such bodies appearing to him to represent the interests of agriculture, forestry and deer and nature conservation.
(2) The duties of the said Committee shall be—

(a) to advise the Minister on any question which he may refer to that Committee in connection with deer;

(b) to advise on weapons and ammunition to be used for the killing of deer and the areas where such weapons and ammunition are to be used;

(c) to keep under review, and to advise the Minister on, measures needed for the better management of deer in England and Wales.

The noble Lord said: I beg to move Amendment No. 61A. I accept readily Amendment No. 61B in the name of my noble friend; it is a drafting Amendment. Here we come to a slightly more difficult situation. I have said already that the Advisory Committee is part of the total compromise reached with the farming community. I would add that, of course, noble Lords opposite— the noble Viscount, Lord Mountgarret; the noble Viscount, Lord Thurso, who is not here today; and others—have at earlier stages of the Bill strongly pressed for the introduction of an Advisory Committee. Could first of all give the broad justification, in addition to the issue of shotguns? The Advisory Committee, as set out in this Amendment, is in order to advise the Government (I shall come to the question of Ministers in a moment) on various matters concerning deer. The basic intention, in addition to advice about
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shotguns, is that in England and Wales we will gradually move towards the better management of deer. In Scotland we have the Red Deer Commission. In Scotland we have a sense of treating deer as a national, natural asset, and managing it.
No one would say that the circumstances in Scotland and England are identical, but there is a similarity. The population of deer in England is growing, and as the years go by it is becoming important to begin to manage deer in a conscious manner and to plan their future. At the moment, with great respect—I know my noble friend will allow me to say this—deer in England are considered wild animals and are dealt with by an Assistant Secretary, who covers, I understand, drugs, probation and all sorts of things. I hope we are going to move on from that state of affairs to conscious management under a Minister. As is set out in the Amendment, the intention is that the Minister of Agriculture should be the person appointing this Committee. This is because, as in Scotland—and I repeat, "as in Scotland", where the Department of Agriculture for Scotland accepts this responsibility—it is appropriate to begin moving deer from Home Office and cruelty to Minister of Agriculture and management.
I know that my noble friend is in a difficult situation. The Home Office does not want an Advisory Committee; but I think I am allowed to say that, in consultations with the Minister concerned at the Home Office, the Home Office is prepared to say, "We will not obstruct such an Advisory Committee provided that we, the Home Office, do not have to set it up and service it, listen to it and give it jobs to do, and assume responsibility for deer" But I know that, wearing another hat, my noble friend has to say that at the moment the Minister of Agriculture is not satisfied that he should take it over—and he has written to me to that effect. I will not read his letter out for that would unduly delay us, but that is a fair statement, that he is not ready to take this matter over.
My Lords, I understand that this should not be regarded as the end of the road. What is needed is for this House and for people outside, and I hope for the other place, to put pressure on the Minister of Agriculture so that he is able finally to say, "All right; I will accept

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this pressure, and I will begin steadily to accept this responsibility, starting with this Advisory Committee and perhaps broadening out in years to come". Because, as I understand it, if in years to come the Minister develops this sense of responsibility, it will be possible by Order in Council to transfer other functions in this Bill from the Secretary of State for Home Affairs to the Minister of Agriculture, by means of a transfer of function order; so that gradually, using this as the opening, as the thin end of the wedge—I do not deny it for one moment—we begin to introduce into the situation the responsibility of the Minister of Agriculture for the management of deer.
I hope that, if my noble friend has to repeat what I have said—namely, that the Minister of Agriculture is not persuaded —then those noble Lords who have joined me in helping this Bill forward will be outspoken in their condemnation of the Government's attitude on this and in their pressure on the Minister to accept the responsibility. I undertake that, if this clause is agreed at this stage, I will report back on Third Reading whether I have persuaded the Minister, with the help of noble Lords today, to accept this responsibility in some form. I cannot claim T will succeed, but I have a fair hope if noble Lords will back me.
I have just two other points to make. The noble Lord, Lord Stanley, with the NFU, pressed strongly that the farming community should have a clear right to membership of this Advisory Committee. That is safeguarded, not only by saying that they should be on the Committee but that they should be their nominees, and not their representatives. I think that is a very helpful step, although, of course, this must also apply to some other people who are equally interested in deer. Secondly, the noble Lord wrote to me and said that he hoped I would say a word about those farmers, landowners or others who were over-interested in conservation and never wanted any deer killed on their property. I can only say to him that I think an Advisory Committee as constituted under this new clause will have a broad enough membership. a balanced enough approach, to begin this process of management, so that anybody who does not agree with the proper culling of deer—I think there are very few people
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who do not agree with proper culling, but anybody who wants to preserve deer at all costs, so to speak—will, over a period of time, be educated into proper culling, into proper management, in a way that he would approve.
I hope that goes some way towards reassuring the noble Lord that this is not an Advisory Committee for the permanent protection and conservation at all costs of deer: it is an Advisory Committee concerned with proper management, which includes proper culling. I apologise to your Lordships for speaking at some slight length on this issue, but it is a very important one, and I had to warn noble Lords in advance that my noble friend is likely to be slightly hostile on this issue. I beg to move.
The DEPUTY SPEAKER: I will now call Amendment No. 61B, which is an Amendment to Amendment No. 61 A.
7.58 p.m.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 61A, Amendment No. 61B:
Line 6, leave out ("appearing") and insert ("as appear").
The noble Lord said: My Lords, perhaps this would be an opportune moment for me to intervene so far as Amendment No. 61A is concerned.
The DEPUTY SPEAKER: My Lords, I have called Amendment No. 61B. The noble Lord can speak to Amendment No. 61A also, but No. 61B is an Amendment to No. 61A and we must get that out of the way before we vote on the substantive one. It is the noble Lord's own Amendment.
Lord WELLS-PESTELL: In that case, my Lords, I beg to move Amendment No. 61B, an Amendment standing in my name, and perhaps your Lordships will allow me also to speak to Amendment No. 61A. As I was saying, my noble friend Lord Northfield, as I would expect, has put the position very fairly and very frankly, but it is a matter for your Lordships to resolve. I want to put the Government point of view, but 1 do not want to do it in any aggressive sense, and certainly not in any hostile sense. As noble Lords will know, we have come a

1319
long way in this Bill, and there is now a very large measure of agreement which some of us could not foresee a week or two ago. But as we understand the situation, there is no Ministerial function under this Bill, or indeed under any other legislation relating to deer.
It has been suggested that this Amendment is a matter for the Minister of Agriculture. My right honourable friend the Secretary of State for Home Affairs certainly does not consider that it can in any way be his responsibility, and presumably my noble friend has accepted that in moving Amendment No. 61A. Here, again, to impose the duty of appointing the members of the proposed committee on the Minister of Agriculture—who has no responsibilities whatever in relation to deer except in circumstances where they amount to an infestation by causing damage to crops or by spreading diseases —rightly or wrongly, seems to the Government to be unreasonable. I do not think that I can say any more because there is nothing more to say. The Government's view is that this is not a matter for either the Minister of State for Home Affairs or for the Minister of Agriculture. I have not yet heard your Lordships' views; but it is for you to decide whether this is an Amendment which you feel is desirable in the circumstances.
On Question, Amendment to the Amendment agreed to.
The DEPUTY SPEAKER (Viscount Hood): My Lords, the Question now is that Amendment No. 61A, as amended, be agreed to.
Lord DULVERTON: My Lords, I should like very strongly to support the Amendment as put forward—and now amended—by the noble Lord, Lord Northfield. I have long had a growing conviction that the deer problem in England and Wales has grown to such proportions—insidiously almost, a phrase which I think I used during the Second Reading—that it must seriously be taken note of, and I would suggest, by the Minister of Agriculture. My interest in the problem we are discussing today, as is known to some of your Lordships. is widely spread. It includes interest and a certain degree of experience of deer control in Scotland. I am, in fact, a
1320
member of the Red Deer Commission which is charged with the control and conservation of red deer, mainly in the Highlands but all over Scotland. Their brief does not include the other deer, but, of course, it is the red deer which are the most numerous and which cause the most damage in Scotland. That is not the case, I think, mainly in England and Wales; but for five or six years I have seen intimately the work of the Red Deer Commission in carrying out those two functions of regulated control and conservation. I feel conviced that they fulfil a useful function in carrying the balance in an authoritative manner as between the farming community and the forestry community, on the one hand, and the deer forest owners on the other.
They are responsible to the Department of Agriculture for Scotland. I should have thought that there was a strong case for assuming that, if we set up an advisory committee, as is now suggested, which would bear a great deal of similarity to the Red Deer Commission in Scotland in its duties and functions, then it should be to the Minister of Agriculture that they are responsible.
My Lords, after all, there are other wild creatures for which the Ministry of Agriculture has long taken some responsibility; animals that do a certain amount of damage in farm crops, rabbits, rats—we could go on with a long list. There is some precedent, therefore, even if no strong precedent exists in any direction in relation to deer, for looking to the Minister of Agriculture to take some responsibility in this matter.
I have referred to the natural interest of the Minister of Agriculture in the interests of farmers and farm crops; but he has another interest which he exercises through his Forestry Commission, the Forestry Commission being responsible directly to the Minister of Agriculture. Not only do deer problems exist just in full in the woodlands in England and Wales but they were noticed there before they were noticeable in the farmlands. I should like to draw your Lordships' attention to two points. One is that the Forestry Commission, themselves, have long since banned the use of shotguns in their woods and utilise rifles for the proper control of deer in and around the margins of their woods. This is a

1321
point of passing interest. But the other point, which is, I believe, of interest and which relates to the same line of thought, is that when the representative organisation for the woodland growers, the private foresters of England and Wales, had this point put to them, they unanimously decided that they would wish to support a move to stop the use of shotguns in deer drives and to use only rifles as originally was suggested in this Bill.
My Lords, I hope very much that the Government will take another look at their attitude in this matter, and, in particular, that the Minister of Agriculture will do so, because the problem is such—and the population of various sorts of deer is so large now in the Southern half of the United Kingdom—that we cannot possibly ignore it or pretend that it and its attendant problems do not exist. These problems affect mainly the farmers and the foresters, both of whom look to the Minister of Agriculture for the protection of their interests. I wish to support the noble Lord, Lord Northfield, most strongly and I hope the Government will take another look at this matter.
8.8 p.m.
Viscount MOUNTGARRET: My Lords, I should like to support very strongly the Amendment proposed by the noble Lord, Lord Northfield, and, in particular, what my noble friend Lord Dulverton has just said. I should not really comment too much on what he has said since he has said all that I should have liked to say. The noble Lord, Lord Wells-Pestell, however, did invite noble Lords to show what they felt and that is why I am seeking to endorse precisely what my noble friend has just said. I feel that it is entirely right and logical that the Ministry of Agriculture should take the responsibility for the Advisory Committee, if we get this through, on this Bill. I thought for one moment that the noble Lord said that neither the Ministry of Agriculture nor the Ministry for Home Affairs should be responsible for this Bill; but, surely, somebody should be responsible! I am sure that it is only logical that the Minister of Agriculture should be so.
My Lords, the noble Lord, Lord Northfield, said that I was one of those who was most keen on the setting up of
1322
the Advisory Committee. I should like to correct him on this. Although certainly I am keen to see it set up, when I heard about it what worried me slightly was that there was no time limit on it. It is easy often to decide to do something, but it is also very easy to get these suggestions and ideas pigeonholed. I should have liked to see some form of timing. If this Advisory Committee can get under way, I should like to feel that the Government would accept that there is a great degree of urgency about this. While I accept that it is possibly undesirable to write an actual time limit into the Bill, for that might be difficult for the Government, I hope that they will realise that the urgency is there; because I am sure there is a general feeling that it is essential to end the use of unsuitable weapons and methods of control of marauding deer.
I should also like to feel that an even balance of interests is fully represented on the Committee. There are occasions when nominees are appointed and there is sometimes an imbalance of interests. This is an important point to bear in mind. I hope very much the Government will bear that point in mind. I fully endorse and support wholeheartedly the Amendment proposed by the noble Lord, Lord Northfield.
Lord DORMER: My Lords, may I also wholeheartedly support the Amendment moved by the noble Lord, Lord Northfield, on the setting up of an Advisory Committee. It has worked well in Scotland and that is of great importance. It is also very important that deer should be properly managed in this country. In Scotland I think they are. For some reason in England there is a combination of great ignorance and vagueness in the matter.
As the noble Lord, Lord Wells-Pestell, has rightly said, we have come a long way in this Bill now. In the course of the Bill we have discussed poaching, the price of venison—which is now enormous—roe deer, the National Farmers' Union and their objections, the proper calibre rifles and the proper weapons that are to be used against deer, and the damage to crops which, as a practical farmer, I know is of great importance. In all these matters, the Ministry of Agriculture must inevitably take a keen interest. I was particularly

1323
pleased to hear from the noble Lord, Lord Northfield, that the chief constable of West Mercia had spoken in such approving terms regarding granting firearms certificates. I live in that police area and I feel sure that that is his view. I think that question has been overplayed.
An advisory body should consist of practical men who know deer and are in touch with them. The management of deer is essentially a practical question, and such a body of practical men could co-relate all conflicting interests and advise the Minister in a most valuable way, as happens in Scotland. I can see nothing but good coming from the appointment of such a body and I earnestly advocate that it should be set up. I hope very much that the Government w ill agree.
Lord DE CLIFFORD: My Lords, may I add my support to the Amendment of the noble Lord, Lord Northfield. It surprised me considerably that there is opposition from the Government that the Minister of Agriculture should not be closely bound up with this matter. As a rather simple minded man who lives in the country, it appears that the deer is the one creature which affects agriculture to its ultimate extent. I cannot see the Home Office, apart from the actual weapons being used to control these animals, being interested whether or not a farmer has had root crops eaten by deer. I should have thought that it was most logical that the Ministry of Agriculture should be the Department most deeply involved in this. I trust that the Government will change their minds.
Lord BURTON: My Lords, I am also disappointed to hear the Government's views. Having heard every speaker so far, I hope that the Minister will be able to convey back to the Government the views of your Lordships' House. This Amendment is absolutely fundamental to the Bill. The agreement has been reached, as some of your Lordships have confessed—and many more were convinced—from an absolutely impossible situation when this Bill commenced its passage through this House. That agreement has been reached not only speaks forcefully for the diplomacy of the noble Lord, Lord Northfield, but also for the value of your Lordships'
1324
House. For the Bill to founder now on what appears to be a technical problem between Government Departments would surely be a complete disaster.
I cannot understand how the Ministry of Agriculture can possibly fail to take responsibility for this matter. I am a practical farmer and, as matters stand at the moment, I apparently seldom agree with the current Minister of Agriculture. On this matter, he seems to have a completely indefensible case. I hope that the Government will think again.
Lord STANLEY of ALDERLEY: My Lords, unless anybody has objections, I should like to say something on this as I was the main objector. First of all, I welcome the agreement on behalf of the National Farmers' Union. I welcome what the noble Lord, Lord Northfield, has said concerning it being a priority regarding agricultural crops. I welcome his remarks about irresponsible conservationists concerning deer which wander on to other people's land.
I and the National Farmers' Union feel that it is vital for the Ministry of Agriculture to be in charge of this Committee. If they are not, the Bill is going to fall. It seems as though the noble Lord, Lord Wells-Pestell, has now taken on my garb of the ugly sister—and I hope he enjoys it! This is an agricultural problem. If his civil servants could read Hansard some time, they will read that this has been my problem. I think—and I regret to say this—I am the only person who has divided the House on it. It is an agricultural problem and I ask them to read what our problems are. If they do that, and take any account of the matter—certainly the noble Lord, Lord Northfield, has—they will see that the Ministry of Agriculture must deal with this Committee.
I cannot understand the argument at all. The Ministry of Agriculture say, I understand, that they have no responsibility for wild animals. They deal with rabbits and rabbit clearance societies. Surely these matters are Ministry of Agriculture problems. The deer lives on my land; what it eats is an agricultural or a forestry problem. It is almost as ludicrous as saying that it does not matter how many sheep one keeps on the hill. If there is not any food on the hill, one cannot keep sheep. It is the same with

1325
the deer. It is an agricultural problem and I am sorry for those who cannot see that. I am sorry for the noble Lord, Lord Wells-Pestell. He lives next door to me and will probably kill me next weekend!
I hope that the noble Lord will persuade his civil servants that this is a Ministry of Agriculture problem. We are telling him that they have to change. I do not see why we should always bow and scrape to the civil servants. I do not think they really mean that; they are just being naturally awkward—rather like me! This has been a masterpiece of negotiation on the part of the noble Lord, Lord Northfield, with the National Farmers' Union and myself. Please do not spoil it now.
On Question, Amendment to the Amendment agreed to.
On Question, Amendment No. 61A, as amended, agreed to.
Clause 20 [Orders]:
8.19 p.m.
Lord NORTHFIELD Lord NORTHFIELD moved Amendment No. 62:
Page 10, line 24, at beginning insert—
(" (1A) Before making any order under this Act, the Secretary of State shall consult the Advisory Committee on Deer in England and Wales established under section (Advisory Committee on Deer in England and Wales) of this Act and such other bodies appearing to him to represent persons likely to be interested in or affected by the order.")
The noble Lord said: My Lords, this Amendment is consequential on earlier discussions. The Amendment makes it clear that the Secretary of State must consult the Advisory Committee in making orders under the Act. It is partly consequential upon the discussion we had at an earlier sitting, when we said that the power to make orders under the Act would be put in more general form. I beg to move.
The DEPUTY SPEAKER (Viscount Hood): As an Amendment to that Amendment, I call Amendment No. 62A.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 62, Amendment No. 62A:
Line 6, leave out ("appearing") and insert ("as appear").
The noble Lord said: My Lords, this is purely a drafting Amendment. I beg to move.
On Question, Amendment to the Amendment agreed to.
On Question, Amendment No. 62, as amended, agreed to.
Clause 21 [Interpretation]:
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 63A:
Page 11, leave out lines 9 to 16.
The noble Lord said: My Lords, your Lordships will recall that I spoke to this Amendment when I moved Amendment No. 52A. I think it is quite clear. I beg to move.
On Question, Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 64:
Page 11, line 22, at end insert—
"(2) Except so far as the context otherwise requires, any reference in this Act to any enactment shall be construed as a reference to that enactment as amended by or under any other enactment.".
The noble Lord said: My Lords, I hope your Lordships will take my word that this is a technical Amendment. There is no problem. hidden or otherwise, in the wording, and I am sure that if there is my noble friend Lord Northfield will not hesitate to say so.
On Question, Amendment agreed to.
Lord BURTON Lord BURTON moved Amendment No. 65:
After Clause 21, insert the following new clause:
Application to Northern Ireland
.—(1) In the application of this Act to Northern Ireland section 200) shall be omitted and the other provisions shall have effect subject to the following modifications—

(a) for any reference to the Secretary of State, there shall be substituted a reference to the Department of the Environment for Northern Ireland:

(b) for the reference in section 14 to the Game Act 1831 and the Game Licences Act 1860, there shall be substituted a reference to the Miscellaneous Transferred Excise Duties Act (Northern Ireland) 1972;

(c) in section 16(1)(c) the words "or shotgun" shall be omitted;

(d) for any reference in section 16(2) to the chief officer of police, by whom the certificate mentioned in section 16(1)(c) of this Act was granted, there shall be substituted a reference to the Chief

1327
Constable of the Royal Ulster Constabulary;

(e) in section 16(2)(c) after the reference (substituted by paragraph (d) above) to the Chief Constable of the Royal Ulster Constabulary there shall be inserted the words or within such further time as the Chief Constable may in special circumstances allow";

(f) at the end of section 16 there shall be inserted the following subsection—

"(3) Where the Chief Constable gives a notice under subsection (2)(b) above, subsections (3) and (4) of section 25A of the Firearms Act (Northern Ireland) 1969 (power of police to require surrender or disposal of firearms and ammunition in certain circumstances) shall apply with the substitution for references to the chief superintendent of references to the Chief Constable.";

(g) for the reference in section 18(5) to a requirement by the Minister of Agriculture, Fisheries and Food under section 98 of the Agriculture Act 1947, there shall be substituted a reference to any scheme made by the Department of Agriculture for Northern Ireland under section 2 of the Agriculture (Miscellaneous Provisions) Act (Northern Ireland) 1959;

(h) at the end of section 18 there shall be inserted the following subsection—

"(9) The Department of the Environment for Northern Ireland may by order substitute for the reference to the period of five years in subsection (7) above, a reference to such other period as may be specified in the order.";

(i) for any reference in section 19 to the Nature Conservancy Council, there shall be substituted a reference to the Department of the Environment for Northern Ireland;

(j) for any reference in section 21 to the Firearms Act 1968, and for the reference to section 57(4) of that Act, there shall be substituted respectively, reference to the Firearms Act (Northern Ireland) 1969 and a reference to section 50(1) of that Act.

(2) The power of the Department of the Environment for Northern Ireland to make orders under this Act shall be exercisable by statutory rule for the purposes of the Statutory Rules Act (Northern Ireland) 1958; and any statutory rule made by virtue of this Act shall be subject to negative resolution within the meaning of section 41(6) of the Interpretation Act (Northern Ireland) 1954 as if it were a statutory instrument within the meaning of that Act.").
The noble Lord said: My Lords, with the leave of the House I should like to speak not only to Amendment No. 65 but 66, 69, 70, 71 and 72 as well. My noble friend Lord Brookeborough expected this stage of the Bill to be reached last week and very much regrets that he is not here to move these Amendments
1328
himself. His absence emphasises the difficulties in attending your Lordships' House for those who live in the further parts of the United Kingdom. In my wildest dreams I never expected to be involved with seeking legislation for Northern Ireland, but my noble friend asked me to move these for him.
I would say that the remainder of Ireland has already got some kind of deer legislation and the North of Ireland is probably the only country in the whole of Europe without any legislation whatsoever. The object of these Amendments is to bring Northern Ireland into line with England and Wales, and I am confident your Lordships will welcome such proposals. Your Lordships will see that there is some need for redrafting the proposals put forward by my noble friend and we are grateful to the noble Lord, Lord Wells-Pestell, for putting down Amendments to this Amendment. Meanwhile, I beg to move Amendment No. 65.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 65, Amendment No. 65A:
In subsection (1) leave out ("the application of this Act to Northern Ireland section 20(1) shall be omitted and the other provisions") and insert ("its application to Northern Ireland this Act").
The noble Lord said: My Lords, subject to your Lordships' approval I should like to speak to Amendments No. 65B, 65C, 65D, 65E and 65F. These six Amendments are technical ones arising out of the Amendment that has just been proposed. As I say there is nothing hidden. They are in a sense drafting Amendments of a technical nature. I beg to move.
Lord NORTHFIELD: My Lords, may I say a few words. I am slightly unhappy about Amendment No. 65E to which my noble friend spoke in moving these Amendments to the main Amendment, because in effect at this point he is deleting the application of the Advisory Committee to Northern Ireland. I fully accept that the clause on an Advisory Committee should be called, Advisory Committee on England and Wales. It would be logical to do so. But, if we have now included Northern Ireland in the Bill, I must give notice that at Third Reading we may need to bring back Northern Ireland within the ambit of the Advisory Committee. I issue that short

1329
word of warning so that noble Lords will not be surprised if we have to return to this issue on Third Reading.
On Question, Amendment to the Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 65, Amendment No. 65B:
In paragraph (g) of subsection (1) leave out ("for the reference in section 18(5)") and insert ("in section 18(5) for the reference").
On Question, Amendment to the Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 65, Amendment No. 65C:
At end of paragraph (g) of subsection (1) insert "and for the reference to any power conferred on the Minister of Agriculture, Fisheries and Food, or on that Minister and the Secretary of State acting jointly, by or under the Diseases of Animals Act 1950, the Rabies Act 1974 or section 9 or 10 of the Agriculture (Miscellaneous Provisions) Act 1976 there shall be substituted a reference to any power conferred on the Department of Agriculture for Northern Ireland by or under the Diseases of Animals Act (Northern Ireland) 1958 or the Diseases of Animals (Northern Ireland) Order 1975".
On Question, Amendment to the Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 65, Amendment No. 65D:
Leave out paragraph (h) of subsection (1).
On Question, Amendment to the Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 65, Amendment No. 65E:
After paragraph (i) of subsection (1) insert—
("( ) section (Advisory Committee on Deer in England and Wales) shall be omitted;
( ) in section 20, subsection (1) shall be omitted and in subsection (1A) for the words from "the Advisory Committee" to "such other bodies" there shall be substituted the words "such bodies";").
On Question, Amendment to the Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved, as an Amendment to Amendment No. 65, Amendment No. 65F:
Leave out paragraph (j) of subsection (1) and insert—
(" (j) for any reference in section 21 to the Firearms Act 1968 there shall be substituted a reference to the Firearms Act (Northern Ireland) 1969;
1330
(k) for the reference in paragraph 4 of Schedule 2 to section 57(4) of the Firearms Act 1968 there shall be substituted a reference to section 50(1) of the Firearms Act (Northern Ireland) 1969.").
On Question, Amendment to the Amendment agreed to.
On Question, Amendment No. 65, as amended, agreed to.
Clause 23 [Short title, extent and commencement]:
Lord BURTON Lord BURTON moved Amendment No. 66:
Page 11, line 27, leave out ("or Northern Ireland").
On Question, Amendment agreed to.
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 67:
Page 11, line 28, leave out from ("Act" to ("shall") in line 30.
The noble Lord said: My Lords, I can take this briefly. The Bill as drafted provides that it shall come into operation on 1st November 1977, with the exception of Part III which should now read Part II which is to come into effect three months after Royal Assent. This provision was reasonable when the Bill was introduced but the passage of time has made this Amendment desirable. If the Bill reaches the Statute Book, it would be about mid-July. It is, therefore, unreasonable to provide for one part to come into operation in mid-October and the rest of the Bill to come into effect a fortnight later. The effect of the Amendment is to bring all the provisions of the Bill into force on the 1st November. I beg to move.
On Question, Amendment agreed to.
Schedule 1 [Close seasons]:
Lord BURTON Lord BURTON moved Amendment No. 68:
Leave out Schedule 1 and insert the following new
Schedule—
(" CLOSE SEASONS
RED DEER (Cervus elaphus)
Stags: 1st May to 30th June inclusive.
Hinds: 16th March to 20th October inclusive.
FALLOW DEER (Dama dama)
Buck: 1st May to 30th June inclusive.
Doe: 16th March to 20th October inclusive.
SIKA DEER (Cervus Nippon)
Stags: 1st May to 30th June inclusive.
Hinds: 16th March to 20th October inclusive.
ROE DEER (Capreolus capreolus)
Buck: 21st October to 15th March inclusive.
Doe: 16th March to 20th October inclusive.
MUNTJAC DEER (Muntiacus species)
Buck: 16th March to 20th October inclusive.
Doe: 16th March to 20th October inclusive.
CHINESE WATER DEER (Hydropotes inermis)
Buck: 16th March to 20th October inclusive.
Doe: 16th March to 20th October inclusive.")
The noble Lord said: My Lords, on Second Reading much concern was expressed over the differences in dates of close seasons between Scotland, England and Wales, and now we hope it will be between Northern Ireland as well. I think these differences were fully justified. There was difficulty in the Border areas where you had only to step one or two paces over the boundary and you were breaking the law if you were doing what you were doing on the other side. As yet we have no customs barriers or other checks on the Border and that the two countries should have so many different seasons seems to me totally incongruous. The seasons for everything else it is legal to shoot in this country—certainly all the game seasons—coincide in the United Kingdom as a whole. For instance, you would not start shooting grouse in England on the 1st August and in Scotland on the 12th, and I do not see why for deer you should start on one date in one country and on another date in the other.
I have publicised these proposals as widely as I could. I have sent copies to the Red Deer Commission in Scotland, to the Forestry Commission, to the Minister and various other people, and until today I have had no objections of any consequence, except for the question that some people feel that the seasons should all start on the first of the month. I do not think it is a very valid ground for complaint. If it is maintained that the police cannot remember these dates, it is unfortunate for the police.
These seasons should be arranged to suit the animals concerned. In any case, the police are not the only people concerned. People who have killed deer on both sides of the Border, if these proposals go through, would have to remember an enormous number of dates and it would be very complicated for them. I understand that the Forestry Commission have discussed these proposals but they are somewhat divided among themselves and have not come to any conclusion so far. I have heard nothing from the Minister about the proposals;
1332
I hope that he is satisfied.
In Scotland, I gather that there have been consultations with the Red Deer Commission and that they were not keen on having any changes in Scotland. There appears to be one very minor difficulty— it is the only major change proposed for Scotland—namely, that if the season for red hinds was extended into the autumn there might be difficulty with their counting and census work. That is not a very valid point because the Red Deer Commission have compulsory rights of entry in any case. However, the Red Deer Commission, to my mind, are not the right people to consult in Scotland on deer as a whole. They have a knowledge of hill red deer, but many of them really have not a very great knowledge. I would, of course, exclude my noble friend sitting in front of me who has an intimate knowledge of all kinds of deer; but certain members of the Commission might almost be called "anti-deer". One of them, at a symposium last year, actually advocated killing roe does when they had their fawns afoot, lying hidden, so that the fawn would probably have died. I am sure that your Lordships would never agree with that sort of treatment.
Anyway, the seasons in Scotland are somewhat of a farce because they do not apply on enclosed land, and already a shockingly high proportion of red stags are killed out of season. Also, as roe and sika deer are more often than not killed on enclosed land, they are also getting shot all the year round. A change is badly needed, my Lords. I think it might cause confusion if I were to go through the Schedules in detail: I think they speak mainly for themselves.
There are a number of people who have doubts on certain particular dates, and it is possible that the answer is that there should be round-the-table discussions. If the Bill goes through as it stands, the advisory body would be able to advise the Minister in England. The Minister in Scotland has powers to alter any close season by order in any case, except for red deer. Therefore, it would be possible even after the passing of the Bill, with goodwill on all sides, to try and get coordinated seasons for deer. I beg to move.
Viscount MOUNTGARRET: My Lords, I should just like to say that I did

1333
not quite follow what my noble friend was saying about co-ordinating the closed season for stags in Scotland. As regards red deer stags, 1st May to 30th June does not really apply to Scotland at all. The close season for red deer stags in Scotland is 20th October. I may be wrong about that—have I got the wrong paper? I should have thought, my Lords, that this is just the sort of subject where we should leave well alone and let the Advisory Committee advise the Minister. We should not pre-empt the work of the Advisory Committee.
Lord DULVERTON: My Lords, with the greatest respect to my noble friend Lord Burton, I must confess that I am one of those who, like my noble friend who has just sat down, feel that would be a good way of dealing with it and that we should not attempt to change the dates as they appear in the Bill at the present time. I do not feel that I can support this Amendment.
Lord WELLS-PESTELL: My Lords, I was not going to intervene, but in view of what the two last speakers have said, I wonder whether the noble Lord, Lord Burton, feels that he should proceed with this matter. There seems to be some conflict and I think we ought to get the Bill absolutely correct. If there is any doubt, the noble Lord, Lord Burton, may feel that this should be withdrawn and looked at again.
Lord NORTHFIELD: My Lords, I should like to support what my noble friend has just said, and to record two points. First, the Minister, by means of this Bill, has power to amend close seasons if evidence reaches him that they need to be changed. That is a very important point, so I do not think the noble Lord need ask for a final answer on this issue today. The second point is that, by and large, the Bill as drafted repeats the Deer Act provisions of 1963, which have worked satisfactorily in terms of dates for 14 years; so there is no prima facie case for their alteration in England.
I accept that an effort would be worth while, where it is appropriate, to bring the close seasons into line, and what I would undertake to do, if the noble Lord would accept it, and if the Bill becomes law, would be to ask the Minister to ask the
1334
Advisory Committee to look at this urgently. Also, I should be glad, as a preliminary to that, if the noble Lord feels anxious on the issue, to try to get round the table in advance with the two Departments concerned, together with the noble Lord and other interested parties, to see whether, even at an earlier stage, there is some hope of getting agreement on this issue. I hope that assurance will enable the noble Lord to feel able to withdraw his Amendment.
Lord BURTON: My Lords, as usual, the noble Lord is once more full of diplomacy. That is the way in which he has conducted the whole of the operations in connection with this Bill. It really makes it almost impossible for me not to withdraw the Amendment. However, I should like to emphasise that there is a great need to co-ordinate these dates and I would hope that, with the assurances that have been given, something will be done. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
8.35 p.m.
Schedule 2 [Prohibited firearms and ammunition]:
Lord WELLS-PESTELL Lord WELLS-PESTELL moved Amendment No. 68A:
Page 12, line 29, at end insert ("(within the meaning of section 57(4) of the Firearms Act 1968)").
The noble Lord said: My Lords, I spoke to this Amendment when I moved Amendments Nos. 52A and 63A. I beg to move this Amendment.
On Question, Amendment agreed to.
Schedule 4 [Enactments repealed]:
Lord BURTON Lord BURTON moved Amendments Nos. 69 to 72 en bloc:
Page 14, line 3, at end insert—
("Acts of the Parliament of the United Kingdom").
Page 14, line 7, at end insert—
("Act of the Parliament of Northern Ireland

1969 c. 16 (N.I.).

The Theft Act (Northern Ireland) 1969.

In Schedule 1, paragraph 1.")

In the Title, line 3, after ("Wales") insert ("and Northern Ireland").
Page 14, Line 5, after ("Wales") insert ("and Northern Ireland").
The noble Lord said: My Lords, I beg to move these Amendments. They are all intended to bring Northern Ireland into line. I beg to move.
On Question, Amendments agreed to.

GREATER LONDON COUNCIL (MONEY) BILL
Brought from the Commons; read 1a, and referred to the Examiners.
EMU WINE HOLDINGS LIMITED AND SUBSIDIARY COMPANIES BILL [H.L.]
Returned from the Commons agreed to.
BRITISH RAILWAYS BILL
Brought from the Commons; read la, and referred to the Examiners.