Lords Sitting of 17 May 1977

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

GIBRALTAR: AIR SPACE RESTRICTIONS
Lord BOYD-CARPENTER: 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To ask Her Majesty's Government whether the Spanish Government have now withdrawn or modified the restrictions imposed by them on the use of Spanish air space by British civil aircraft using Gibraltar Airport.
Lord ORAM: My Lords, I regret that the Algeciras Prohibited Zone which applies to aircraft of all nationalities remains in force. It is of particular concern to Britain since it imposes limitations on the approach to landing and take-off manoeuvres of aircraft using Gibraltar. The matter has been discussed with the Spanish authorities on various occasions, but it has not up to now been possible to secure any relaxation.
Lord BOYD-CARPENTER: My Lords, is the noble Lord aware, however, that these restrictions substantially erode the margins of safety involved in the operation of aircraft into and out of Gibraltar? Now that the Spanish Government are seeking closer and better relations with the nations of Western Europe, might it not be expedient to point out to them that until they cease to interfere with access to a loyal British colony they can hardly hope for any improvement in relations with us?
Lord ORAM: My Lords, I agree with the second part of the noble Lord's supplementary question. Periodically that point is put very strongly to the Spanish Government by Her Majesty's Government. With regard to the safety question,
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I understand that the zone does not constitute a serious additional safety hazard. Indeed, as the noble Lord will well remember, the Civil Aviation Authority has no record of any incident in which the safety of civil aircraft was put at risk by the presence of the zone.
Lord BOYD-CARPENTER: My Lords, if I may deal with the noble Lord's final point, is it not a fact that the manoeuvre, involving a very sharp turn just before landing or just after take-off, must, as I put it in my original Question, erode the margins of safety, inasmuch as there is a lower margin of safety upon which to rely if any other problem arises? If the noble Lord will refer to it, is not that the considered view of the Civil Aviation Authority?
Lord ORAM: My Lords, I accept the way that the noble Lord now puts the question. At that point there is obviously an additional workload on the pilot making the right-hand turn, which would not be the case if the restricted zone did not exist. I accept that point, but I am advised that this is not a serious additional safety hazard.
Lord LEE of NEWTON: My Lords, now that the Spanish people are feeling their way gingerly towards democracy, would my noble friend agree that one of the ways in which they could re-establish themselves in the eyes of the Western World would be to cease the stupid victimisation of the Gibraltarians which they have had to endure for so many years?
Lord ORAM: My Lords, I agree that we hope for increasing democratisation in Spain. We are putting to the Spanish Government the point of view that my noble friend expresses in relation to the Gibraltar situation.
Lord TREFGARNE: My Lords, is it not the case that Spain has recently applied for membership of the European Economic Community? Will he therefore represent this very unsatisfactory state of affairs to those who are responsible for the negotiations of that application? Would he also carry back to his right honourable friend the views of my noble friend Lord Boyd-Carpenter, which carry considerable

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weight and which are causing very considerable concern among the airlines operating into Gibraltar?
Lord ORAM: My Lords, I will certainly convey the points which the noble Lord, Lord Boyd-Carpenter, has made here this afternoon. On the question of a Spanish application for membership of the European Economic Community, Spain has not yet made such an application. Therefore, it would be premature to speculate on the issues which might arise if it did so. However, we should naturally have the interests of the Gibraltarians firmly in mind in any negotiations for Spanish entry into the EEC, should they come about.
Lord BALFOUR of INCHRYE: My Lords, the Minister plays down the element of risk which is involved in the sharp turn during the approach to Gibraltar. May I ask him whether he has consulted the British Airline Pilots' Association who, I think, would not agree with the playing down by the Minister of the element of risk.
Lord ORAM: My Lords, I have taken the advice of the officials in my Department on this technical question of safety, and I have reported their advice to the House. I have no doubt that, in reaching their conclusions, they will have had consultations such as those to which the noble Lord refers.
Lord BALFOUR of INCHRYE: My Lords, is it not better to consult the people who are doing the job rather than the officials in Whitehall?
Lord ORAM: My Lords, I referred to my consultations with those who advise me. It is not for me to speak to the pilots.
Several noble Lords: Why not?
Lord ORAM: My Lords, I said that I had no doubt that the officials in my Department had held those consultations.
Baroness WARD of NORTH TYNESIDE: My Lords, did not the noble Lord read what the British Airline Pilots' Association had to say and make a judgment, or is he just concerned with
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taking the advice of his officials, who, so far as I can see from what the noble Lord has said, may not have had all the information?
Lord ORAM: My Lords, Ministers in successive Governments take advice from their officials. That is what officials are for, and that is what Ministers are for. I have faith that the officials who advise me have taken proper steps in giving their advice.
Lord HARMAR-NICHOLLS: My Lords, is the noble Lord aware that one of the reasons for Parliamentary Questions is that the political chief will use them as a hook on which to make his own investigations to see how his officials arrive at the advice they give to him?
Lord ORAM: My Lords, during the time that I have been at this Dispatch Box I hope I have made it clear that I use my personal influence in quite a number of matters, but that does not go against the expressions of view that I gave about the position of a Minister in relation to his officials.

LONDON AIRPORT: PROPOSED FOURTH TERMINAL
2.44 p.m.
Baroness Young: 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 intend to hold a public inquiry into the proposal to build a fourth terminal at Heathrow airport.
The PARLIAMENTARY UNDER-SECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Baroness Birk): My Lords, the British Airports Authority have consulted the local authorities concerned about the proposed fourth terminal at Heathrow and, in the light of the views being received from them, my right honourable friend the Secretary of State for the Environment is considering whether there should be a Direction under Article 4 of the General Development Order. A Direction would make the BAA's present proposal the subject of

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normal planning control and would be an essential first step towards any statutory public planning inquiry.
Baroness YOUNG: My Lords, I thank the noble Baroness for that reply. Can she say how many local authorities were consulted in regard to this development and when she expects a decision to be reached as to whether or not they might expect to have a public inquiry?
Baroness BIRK: My Lords, the following local authorities were consulted: Surrey County Council, Spelthorne Borough Council, the London Borough Council of Hounslow, the Greater London Council and the London Borough Council of Hillingdon. We are still awaiting the views of the London Borough Council of Hillingdon, which have not yet been received by my Department and after that the Secretary of State will be able to make his decision.
Baroness YOUNG: My Lords, is the noble Baroness not aware that the complexities of a fourth terminal at Heathrow reach much further than the four authorities she has just named, and should not the Department of the Environment be consulting on a much wider scale than that mentioned because of the noise nuisance, the increasing numbers of the population that will be required to service the terminal and the other infrastructure required?
Baroness BIRK: My Lords, the consultation went very much wider than that and indeed the BAA itself went much wider, but the noble Baroness asked me to name the actual local authorities and that is why I restricted my answer. If an Article 4 Direction is made and a public inquiry is held, as the noble Baroness is aware, it will be wide open for any sort of comments and views to be put to it.
Baroness EMMET of AMBERLEY: My Lords, may I ask the Minister to give us an assurance that, if there is to be a fourth terminal at Heathrow, a more practical architect will be employed to build it than was employed when the third terminal was built?—because it is totally impracticable for people arriving from far distances.
Baroness BIRK: My Lords, I think that that is one of the points that would have to be considered after the first decision is made and it would be quite improper for me to go into the merits of it at the moment.

CUBAN MILITARY PRESENCE IN AFRICA
2.47 p.m.
Lord ORR-EWING: 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 was the last date, if any, when they made diplomatic representations concerning the deployment of Cuban military personnel in Angola, Zaire, Mozambique, Eritrea or Ethiopia.
The MINISTER of STATE, FOREIGN and COMMONWEALTH OFFICE (Lord Goronwy-Roberts): My Lords, sovereign independent States are entitled to decide from which countries they choose to seek assistance, and representations by Her Majesty's Government would not therefore be appropriate. However, we have made known our view in appropriate quarters that detente is an indivisible process and that legitimate concern arises if and when outside influences put at risk the achievement of peaceful solutions to critical and dangerous situations.
Lord ORR-EWING: My Lords, I thank the noble Lord for the second part of the reply. Is it not true that, by insufficient initiative and objections by Her Majesty's Government, we are to some extent condoning the activities of Cuban mercenaries transported and armed by the USSR? Does not their presence there in so many places contribute to the turmoil in that part of the world, and is it not helping to undermine the position of the Free World in Central and Southern Africa?
Lord GORONWY-ROBERTS: My Lords, I cannot accept the conclusions which the noble Lord draws from the policy of Her Majesty's Government. It is not in fact practicable for us to interfere

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with the invitation of one sovereign Government to another to come to its assistance. We do this with friendly countries ourselves. If we were to condemn the one, we should have to abandon the other. As to the concern expressed by the noble Lord, I entirely agree and we miss no opportunity of making absolutely clear, in Africa and in Europe, our concern about the danger to peace in various parts of the world from unwarranted interference by one country in the internal affairs of another.
Lord CARRINGTON: My Lords, am I not right in thinking that at the conclusion of the Angolan hostilities—the Civil War—there was an undertaking by the Cuban Government progressively to withdraw its forces? If I am right—and I think I am—how many Cuban troops are now left?
Lord GORONWY-ROBERTS: My Lords, I could not put a figure to the Cuban presence in Angola, but it runs into some thousands; some say about 15,000.
Lord CARRINGTON: Has there been a reduction, my Lords?
Lord GORONWY-ROBERTS: I would not say so, my Lords, but I should like to be fairly precise about numbers in this case, if I can. As the noble Lord said, there was an indication that the Cubans might consider a progressive withdrawal. I believe he is right in saying that, but I do not see that it has happened yet.
Lord GISBOROUGH: My Lords, if Her Majesty's Government accept the principle that countries may call for help wherever they wish, is that not an exact parallel to the case of Czechoslovakia when the Sudeten Germans called in Hitler, and was that not an equal invitation? Can the noble Lord say just what the qualifications are by which an invitation can be made and who can make it?
Lord GORONWY-ROBERTS: My Lords, I do not think most of us would equate the Henlein movement in Sudeten Germany with the established and recognised Government of a country.
Lord CHALFONT: My Lords, may I ask the Minister whether he can confirm the reports of prisoners of war in Southern Zaire, in Shaba, that Cuban instructors or Cuban troops crossed into Zaire and withdrew from Zaire only when there was a reaction from Moroccans, with the assistance of the French? May I further ask him whether Her Majesty's Government are aware that in addition to the places mentioned in Lord Orr-Ewing's Question there is clear evidence of Cuban presence in Libya, Conokri, Guinea Bissau, Congo Brazzaville, Nigeria, Somalia and Mali? Can Her Majesty's Government confirm the presence of Cuban troops in those places, and, if so, will they make it clear to the Soviet Union that future progress on detente will depend upon the Soviet Union bringing pressure on the Cuban troops to withdraw from those places as it is clearly the Soviet Union which has put them there?
Lord GORONRY-ROBERTS: My Lords, I think I can go along with my noble friend on the third point. Certainly we have conveyed, do and shall convey to the Soviet Union and other Governments views approximating very closely to those put by the noble Lord, Lord Chalfont. On his first question, whether I can confirm the reports to which he referred, no, I cannot at this moment. I will look into the point he has raised and see how far we can confirm the information he clearly has.
On the second point, he instanced a number of countries where there may or may not be varying degrees of involvement by the Cuban Government officially, with or without Soviet connivance. The situation varies, as he knows, from one country to another. Most of the countries he mentioned have, of their own volition, asked for this kind of assistance. Whether or not we approve of this it is their right and privilege to do so. In one or two cases I should like to look at the details of my noble friend's second point. I welcome the interjection. It is necessary to give particular attention to it.
Lord AVEBURY: My Lords, whether or not the Cubans were involved in the invasion of the province of Shaba in Zaire, has the noble Lord noticed reports of brutalities and serious ill-treatment committed against journalists trying to

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report on the conflict there? What representations will Her Majesty's Government make to the Government in Zaire on behalf of those journalists in respect of the brutalities, which do not encourage people in the West to defend the régime there against subversion?
Lord GORONWY-ROBERTS: My Lords, as I understand it—and I may not be completely in the picture about this particular point—these reports are not fully authenticated. If they are, then I certainly would wish to make representations about these practices. I give that assurance now. As to Cuban involvement, once more, leading on from the very important questions put to me by the noble Lord, Lord Chalfont, the Cuban Government have denied reports of involvement in the invasion of Shaba province, and indeed their Ambassador has attended at the Foreign Office precisely to make that denial.
Lord CHELWOOD: My Lords, so that there may be no doubt, will the noble Lord say what he meant when he said that diplomatic representations had been made in the appropriate quarters? Did he mean they had been made to the Soviet Government and the Cuban Government? May I ask the noble Lord whether Her Majesty's Government accept the fact that these actions by Cuban troops in many countries in Africa pose a very real threat indeed to the independence of the countries concerned and to their neighbours?
Lord GO RONWY-ROBE RTS: My Lords, I appreciate the faith in many countries in Africa that the noble Lord has introduced into his supplementary question. I have no doubt that in many countries these actions do produce a potential threat to the independence of those countries. What we have to be careful about is that we do not decide for those countries what threat, if any, there is to their independence. However, it is perfectly proper for us to make representations to them, in a friendly way, to indicate the risks which may be run.
As to the nature of our representations, I think I had better confine myself to repetition of what I said at the beginning. Ministers, officials, have, as appropriate, to a wide range of Governments, both in
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Europe and in Africa, conveyed the feelings that I can best describe as those presented from all quarters of this House, namely, that détente is indivisible. If one insists on non-intervention in Europe and in Eastern Europe, so one must insist on there not being intervention in Southern and Central Africa.
Lord HAILSHAM of SAINT MARYLEBONE: My Lords, the noble Lord will have read the dreadful stories of massacres occurring in Ethiopia, which is one of the countries mentioned in the original Question. Can he draw to the attention of the Cuban and the Soviet authorities the fact that, in the eyes of all reputable opinion, involvement with such a Government is inevitably going to tar them with the same brush?
Lord GORONWY-ROBERTS: Yes, indeed, my Lords, and I welcome the form in which that suggestion was made. I most certainly will act on what the noble and learned Lord has said.
The Marquess of SALISBURY: My Lords, may I ask the noble Lord a question which I understand it is convenient to ask now, namely, whether the report in The Times today is correct, that the Zambian Government state that there is a formal state of war existing between Zambia and Rhodesia?
Lord GORONWY-ROBERTS: My Lords, I understand that President Kaunda has placed his armed forces on alert against the possibility of Rhodesian armed incursions into Zambia. Her Majesty's Government have made it clear to Mr. Smith that any escalation of fighting could have very serious consequences.
The Marquess of SALISBURY: My Lords, arising out of that answer, could the Minister say why it is serious for the Rhodesians to cross the frontier, when they are constantly under attack from both Zambia and Mozambique? Surely it is not unreasonable for them to take the appropriate action to prevent this recurring?
Lord GORONWY-ROBERTS: My Lords, I think it is a matter for very careful thought and judgment as to what is unreasonable in these extraordinarily dangerous circumstances. I think what

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our Prime Minister and Foreign Secretary have already said to all concerned, particularly to Mr. Smith, ought to have the effect of defusing this extremely dangerous situation. I regret that I cannot add to what I have said to help the noble Marquess or the House on this point.
Lord SHINWELL: My Lords, can my noble friend explain why the military activities of the Cuban Government, either of their own volition or as inspired by the USSR, or some other authority, should be a matter for Her Majesty's Government, who apparently cannot use very much influence in the matter? Why does the Security Council, this peace-keeping organisation, not intervene? Have they any authority, any influence? What are they doing?
Lord GORONWY-ROBERTS: My Lords, I think it is of legitimate and compelling interest to our country, and indeed to any other country, when there seems to be a danger that outside intervention, even by an independent country at the invitation of another, may have the result of accentuating the already dangerous situation in that area. I think it is reasonable for anybody to make representations in the right way in that situation. As to the role of the United Nations, my noble friend will have noticed that there is a conference in Maputo at the present time, at which the Joint Minister of State is expressing, I think today, in clear and unmistakeable terms the United Kingdom's attitude to Southern African problems.
Lord ORR-EWING: Finally, my Lords—
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, I know that all noble Lords feel that there is great interest in this Question, but I must point out that we have spent 22 minutes on it. We have another Question to deal with, and I think I take the feeling of the House that we should proceed to the next Question.
Lord ORR-EWING: My Lords, I think it is normal to allow the original questioner to round things up, but if the noble Baroness has ruled against me I bow to her ruling.

SECURITY COUNCIL AND APARTHEID
3.0 p.m.
Lord BROCKWAY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what conclusions have been reached on apartheid in South Africa by the United Nations Security Council and what action the British Representative took.
Lord GORONWY-ROBERTS: My Lords, the United Nations Security Council debate on apartheid which began on 21st March has been adjourned until 6th June. The United Kingdom Representative has not spoken so far. Our aim throughout has been to reach a consensus whereby the full weight of a united Security Council could be thrown behind the urgent search for a just and peaceful solution to the problems of Southern Africa.
Lord BROCKWAY: My Lords, can my noble friend explain why there has been this long delay in reaching some conclusion on this subject which has now gone on for some months? Can he say whether the British Government support some restriction on investments in companies in South Africa which are practising apartheid as illustrated in last week's report about the inhuman and appalling conditions in the mines of Johannesburg?
Lord GORONWY-ROBERTS: My Lords, I do not think that it would be the consensus of opinion that there has been undue delay on this problem. I have said that this particular and very important discussion has been adjourned until 6th June, so that not only this country but others can consider how usefully they can contribute to the search for a solution. It is very complex; it is a major question. One might say that there has been a delay of many years, not simply of a few weeks. If we invest a few weeks in talking to each other in order to achieve a consensus, surely that is a very good investment.
I turn to the other kind of investment which my noble friend raised. Here our

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policy is clear. We do not place restrictions on normal civil trade with and investments in that country. However, we have made it clear that we expect British firms in their commercial dealings with the Republic to honour the spirit as well as the letter of Government policies.
Lord BARNBY: My Lords, as the Minister has indicated that this discussion will continue and that our Representative has not yet spoken, will that Representative be instructed to bear in mind that our trade with South Africa, and therefore the importance of employment in this country, will be given priority in considerations and expressions by our Minister on all matters, apart from ideological matters which in another country are not our business?
Lord GORONWY-ROBERTS: My Lords, I think that my reply to my noble friend Lord Brockway put the position as to trade and commerce quite precisely. There is no change in the Government's attitude on these matters. From time to time it is a matter of priorities, but the basics are that we intend to continue civil trade with the SAR—and quite rightly so—while maintaining our political attitude on the question of apartheid.
Lord BROCKWAY: My Lords, in view of the fact that the Government have taken some initiative to secure the payment of a living wage by British companies in Southern Africa, will they now extend that initiative to take in the conditions under which workers are employed, and the appalling and inhuman conditions which are to be found in many of the compounds of the mining firms of Johannesburg?
Lord GORONWY-ROBERTS: My Lords, I am grateful to my noble friend for reminding the House of the fruitful initiatives which successive British Governments have taken in enjoining upon British firms their duty to take the lead in improving conditions in the employment of Africans of all colours. As to future progress, we see it primarily, but not only, as the encouragement of free trade unions for workers of all colours in the South African Republic.
Lord CHELWOOD: My Lords, although I am entirely in favour of the
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Security Council concerning itself with apartheid in South Africa, is it not equally important that the Security Council should concern itself with the previous Question which was raised by my noble friend Lord Orr-Ewing.
Lord GORONWY-ROBERTS: My Lords, yes. There is no bar on the Security Council—which by definition is concerned with security, which after all is the basis of peace—considering that matter and indeed all matters related to peace and security. In the light of circumstances and evidence, I have no doubt that individual members of the Security Council will move in that direction. There are, after all, five permanent members, of which we are one.
Lord COLERAINE: My Lords, I was prevented by the intervention of the noble Baroness the Captain of the Gentlemen-at-Arms from intervening in the last Question. I should like to ask the noble Lord a similar question. Does he regard the activities of the United Nations in Central and Southern Africa as being conducive to world peace or as being conducive to further disorder?
Lord GORONWY-ROBERTS: My Lords, the answer is, conducive to world peace. The situations of danger and difficulty, of which we are all aware, have been well publicised and so have the failures of the United Nations. The successes of the United Nations and the part it has played in maintaining uninterrupted peace in terms of world disturbance for 32 years have not been so well publicised or well regarded. If the United Nations did not exist it would somewhere or other, like Voltaire's God, have to be invented.
Lord DERWENT: My Lords, should not some Back-Bencher come to the help of the Government Chief Whip by pointing out that we have now spent 29 minutes on Questions.
Lord GORONWY-ROBERTS: My Lords, may I, in my other role—the noble Lord the Leader of the House being absent—say that the cricketing score seems to indicate that this Question, even more than was so with the other, should be brought to an end.

BILL OF RIGHTS
The CHAIRMAN of COMMITTEES (Lord Aberdare): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That, as proposed by the Committee of Selection, the following Lords be named of the Committee ordered to be appointed on the 3rd of February last, to consider whether a Bill of Rights is desirable and, if so, what form it whould take, viz.:

Allen of Abbeydale, L. (Chairman)

Blake, L.

Boston of Faversham, L.

Foot, L.

Gaitskell, B.

Gordon-Walker, L.

Jellicoe, E.

Lloyd of Hampstead, L.

O'Hagan, L.

Redcliffe-Maud, L.

Wade, L.

That the Committee have power to appoint Specialist Advisers;
That the Minutes of Evidence taken before the Committee from time to time be printed and, if the Committee think fit, delivered out;
That the Committee do meet at four o'clock on Wednesday, the 25th of May.—(Lord Aberdare.)
On Question, Motion agreed to.

PATENTS BILL [H.L.]
3.6 p.m.
Read 3a.
Clause 2 [Novelty]:
Lord ORAM Lord ORAM moved Amendments Nos. 1 to 3:
Page 2, line 42, after ("patent") insert ("or a patent").
Page 2,line 43, leave out ("another application for a") and insert ("an application for a") and insert ("an application for another").
Page 3, line 4, leave out ("that other application") and insert ("the application for that other patent")
The noble Lord said: My Lords, these Amendments, the second and third of which are consequential upon the first, cure a defect in Clause 2(3) which arose as a result of Report stage Amendment No. 2. That Amendment, which excluded from the scope of Clause 2(3) consideration of matter contained in the application in suit, inadvertently restricted the scope of the subsection to the case of applications. It should, of course, apply equally to inventions to which a patent relates. These Amendments make that correction.
On Question, Amendments agreed to.
Clause 5 [Priority date]:
Lord ORAM Lord ORAM moved Amendment No. 4:
Page 4, line 30, after ("preceding") insert ("the date of filing").
The noble Lord said: My Lords, this is a small drafting Amendment to make it abundantly clear that it is the date of filing of the application in suit to which reference is made. I beg to move.
On Question, Amendment agreed to.
Clause 15 [Publication of application]:
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 4A:
Page 14, line 36, leave out ("subject to section 20 below").
The noble Lord said: My Lords, this is purely a consequential Amendment arising out of the action taken by the House on Clause 20. With the leave of the House, at the same time I should like to speak to Amendments Nos. 6A, 46A, 46B, 55A, and 66A. They are entirely formal Amendments. I am very grateful to the Public Bill Office—to Mr. Webb and his assistants—for having picked up these Amendments which are supplementary to the Marshalled List. I beg to move Amendment No. 4A.
Lord ORAM: My Lords, I accept what the noble Lord, Lord Lloyd, said about these Amendments being consequential on action that the House took on Report. I would therefore advise the House to accept Amendment No. 4A and the subsequent ones to which the

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noble Lord referred. While accepting that this Amendment is technically necessary in consequence of the deletion of Clause 20, I do not retract anything that I said on that occasion on the merits of Clause 20. It is purely consequential.
On Question, Amendment agreed to.
3.11 p.m.
Lord ORAM Lord ORAM moved Amendment No. 5
Page 14, line 37, leave out from ("tiling") to ("during") in line 40 and insert (", then, as soon as possible after the end of the prescribed period, the comptroller shall, unless the application is withdrawn or refused before preparations for its publication have been completed by the Patent Office, publish it as filed (including not only the original claims but also any amendments of those claims and new claims subsisting immediately before the completion of those preparations) and he may, if so requested by the applicant, publish it as aforesaid").
The noble Lord said: My Lords, the effect of this Amendment, which fills a gap in the present draft, is twofold. First, it makes it clear that any withdrawal or refusal of the application after the preparations for its publication have been completed by the Patent Office will not prevent its publication under Clause 15 and its consequent inclusion in the state of the art for Clause 2(3) purposes. This change brings the Bill into alignment with Rule 48(2) of the European Patent Convention. The second effect is to make it clear that the comptroller shall not only publish the application as filed but also the last filed claims before the completion of the preparations for publication. This provision, which corresponds to Rule 49(3) of the European Patent Convention, is necessary because it is those claims which will determine the provisional protection afforded by Clause 66 and not any later claims, filed after the preparation for publication has been completed but before the end of the prescribed period, which cannot, of course, be included in the publication. I beg to move.
On Question, Amendment agreed to.
Clause 17 [Substantive examination and grant for refusal of patent]:
Lord ORAM Lord ORAM moved Amendment No. 6:
Page 17, line 12, after ("to") insert ("subsection (5) and").
The noble Lord said: My Lords, in moving Amendment No. 6 I should like
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also to speak to Amendment No. 7. The 1949 Patents Act contains no provision preventing a person from obtaining two or more patents in respect of the same invention where the invention has the same priority date in both cases. This is because it was held in the case of Dreyfus' Application that the Crown should not grant two Letters Patent in these circumstances for the same invention. The Bill, however, does not rest upon a grant of Letters Patent by the Crown, but gives a person a statutory right to a patent if he complies with its requirements. In these changed circumstances, it is no longer safe to rely upon the decision in Dreyfus' Application. The second Amendment (No. 7) therefore puts that decision into statutory form in the Bill. The first Amendment (No. 6) is a paving Amendment for the second. I beg to move.
On Question, Amendment agreed to.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 6A:
Page 17, line 12, leave out ("sections 18 and 20") and insert ("section 18").
The noble Lord said: My Lords, I have already spoken to Amendment No. 6A, and I appreciate the reservation which the noble Lord, Lord Oram, will wish to make in regard to this Amendment. I beg to move.
On Question, Amendment agreed to.
Lord ORAM Lord ORAM moved Amendment No. 7:
Page 17, line 14, at end insert—
("(5) Where two or more applications for a patent for the same invention having the same priority date are filed by the same applicant or his successor in title, the comptroller may on this ground refuse to grant a patent in pursuance of more than one of the applications.").
The noble Lord said: My Lords, I have already spoken to this Amendment. I beg to move.
On Question, Amendment agreed to.
Clause 28 [Nature of, and transactions in, patents and applications for patents in Scotland]:
3.15 p.m.
Lord ORAM Lord ORAM moved Amendment No. 8:
Page 22, line 42, leave out ("probative or holograph writing") and insert ("writing

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probative or holograph of the parties to the transaction").
The noble Lord said: My Lords, this Amendment has the effect of requiring any assignation of a patent or application for one, or any grant of security, to be signed by all parties to the transaction. It thus brings this provision of Scottish law into line with the corresponding English provision in Clause 27 (6). This Amendment picks up a point made by the noble Lord, Lord Belstead, on Report and I thank him for drawing it to our attention. I beg to move.
On Question, Amendment agreed to.
Clause 30 [Requirement for registration or notice]:
Lord ORAM Lord ORAM moved Amendment No. 9:
Page 25, line 17, after ("application") insert ("or any right in or under it to any person").
The noble Lord said: My Lords, this Amendment restores to the text of Clause 30(4)(e) words which were inadvertently deleted by Report stage Amendments Nos. 40 and 41. Therefore, I beg to move.
On Question, Amendment agreed to.
Lord ORAM Lord ORAM moved Amendment No. 10:
Page 25, line 22, at end insert—
("In this subsection 'mortgage' includes a charge for securing money or money's worth.").
The noble Lord said: My Lords, this is merely a technical drafting Amendment of a kind commonly found in Statutes which contain provisions relating to mortgages; it makes plain that the word "mortgage" is to be interpreted as also including a charge for securing money or money's worth. I beg to move.
On Question Amendment agreed to.
Lord ORAM Lord ORAM moved Amendment No. 11:
Page 25, line 28, leave out from beginning to end of line 34.
The noble Lord said: My Lords, this Amendment deletes subsection (6) of Clause 30, which provided an extended meaning for the words,
"the inventor or one of the inventors of an invention",
which formerly appeared in subsection (3)
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of the clause. Those words were, however, removed on Report, so subsection (6) is no longer required. I beg to move.
On Question, Amendment agreed to.
Clause 33 [Co-ownership of patents and applications for patents]:
Lord ORAM Lord ORAM moved Amendment No. 12:
Page 26, line 33, leave out ("section 7") and insert ("sections 7 and 11").
The noble Lord said: My Lords, this Amendment is consequential upon the insertion into the Bill of Clause 11. Just as the provisions in Clause 33 (3), which relate to the granting of licences and mortgaging of patents by co-proprietors, are subject to those in Clause 7, under which the comptroller may, among other things, make an order transferring the rights of a co-proprietor of an application for a United Kingdom patent to anyone else, so also must it be subject to the provisions of Clause 11, under which the comptroller may make such an order in relation to the rights of a co-proprietor of an application for a patent in any other country or under any treaty or international convention. I beg to move.
On Question, Amendment agreed to.
Clause 34 [Determination of right to patent after grant]:
Lord ORAM Lord ORAM moved Amendment No. 13:
Page 28, line 42, leave out ("under subsection (2) or") and insert ("by virtue of subsection (2) or under").
The noble Lord said: My Lords, this is purely a drafting Amendment. As at present drafted, Clause 34(7) refers to an order made under subsection (2) of the clause. It is not strictly correct to do so, because the order is not actually made under that subsection but under subsection (1). Subsection (2) merely states a number of matters for which the order may provide but these are expressed to be, "without prejudice to the generality of subsection (1)", and it is, as I have said by subsection (1) that the power to make the order is conferred. I beg to move.
On Question, Amendment agreed to.
Lord ORAM Lord ORAM moved Amendment No. 14:
Page 29, line 7, at end insert—
("(9) The court shall not in the exercise of any such declaratory jurisdiction determine a question whether a patent was granted to a person not entitled to be granted the patent if the proceedings in which the jurisdiction is invoked were commenced after the end of the period of two years beginning with the date of the grant of the patent, unless it is shown that any person registered as a proprietor of the patent knew at the time of the grant or, as the case may be, of the transfer of the patent to him that he was not entitled to the patent.").
The noble Lord said: My Lords, this Amendment adds a new subsection (9) to Clause 34. It makes a provision in our domestic law which corresponds to what Article 27(3) of the Community Patent Convention provides in respect of Community patents. The effect is that anyone who claims that he should have been granted the patent in place of the person to whom it was in fact granted must institute proceedings to establish his right within two years of the date of the grant. An exception is permitted where the person registered as proprietor knew, at the time when the patent was granted to him or, if he is a successor-in-title of the original grantee, at the time when the patent was transferred to him, that he was not entitled to it.
Lord LLOYD of KILGERRAN: My Lords, is this a new matter from the point of view of the debates we have had on the Bill? I may be wrong, but I cannot recall it being discussed before. I understood the Minister to say that the new provision was required to make our law correspond with Article 27(3) of the Community Patent Convention. If it is an entirely new matter, then I think that should be indicated; in other words, that a Government Amendment is being introduced at this stage although the matter has not been raised before.
Lord ORAM: My Lords, I will take advice, but I think the noble Lord is right and I agree that, with so many Amendments coming forward, it would be for the convenience of noble Lords to have new matter indicated. It may be that references were made to the subject at an earlier stage of the Bill and I will try to find out.
Lord LLOYD of KILGERRAN: My Lords, I am obliged to the Minister.
On Question, Amendment agreed to.
Clause 37 [Compensation of employee for certain intentions]:
3.22 p.m.
The LORD CHANCELLOR (Lord Elwyn-Jones)The LORD CHANCELLOR (Lord Elwyn-Jones) moved Amendment No. 15:
Page 31, line 13, leave out from ("a") to ("provides") in line 17 and insert ("relevant collective agreement").
The noble and learned Lord said: My Lords, it may be convenient for the House to discuss at the same time Amendment No. 15A. The change effected by this pair of Amendments is purely one of drafting. It will be recalled that, as a result of your Lordships' acceptance of Amendment No. 51A moved by the noble Lord, Lord Nelson of Stafford, certain words were inserted in subsection (3) of Clause 37. This pair of Amendments achieve precisely the same objective in what, I hope, will be thought to be a more elegant manner.
Lord BELSTEAD: My Lords, on behalf of my noble friend Lord Nelson of Stafford, who is not able to be here today, I wish to thank the Government for this redrafting which I agree achieves exactly the same object as my noble friend had in mind when he moved his Amendment on Report and which is now overtaken by the better wording of the Government Amendments.
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 15A:
Page 31, line 29, at end insert ("and 'relevant collective agreement' means a collective agreement within the meaning of the Trade Union and Labour Relations Act 1974 made by or on behalf of a trade union to which the employee belongs and by the employer or an employers' association to which the employer belongs which is in force at the time of the making of the invention".)
The noble and learned Lord said: beg to move.
Lord LLOYD of KILGERRAN: My Lords, while thanking the noble and learned Lord for the elegant way in which he moved this and the previous Amendment, may I ask him a question arising

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out of the fourth line of this one, in which there is a reference to "the employee"? It refers to a trade union to which the employee belongs, and it means that a collective agreement which is now associated with Clause 37 made by or on behalf of a trade union to which the employee belongs—
The LORD CHANCELLOR: My Lords, I am sorry to interrupt the noble Lord, but I think the word is "employer".
Lord LLOYD of KILGERRAN: In my copy of the Amendment the word is "employee" my Lords. If the word is "employee", it raises a point which was discussed on Report, when it was indicated that collective agreements covered the position not only of employees who are members of the trade union but employees who are not members but who are within the same field of activity. I remember that when the matter was raised, the noble Lord, Lord Nelson of Stafford, said that collective agreements should not be used to cover employees who were not members of the trade union. I have not been able to give notice of this question to the noble and learned Lord because I received the two booklets with some 80 Government Amendments only yesterday afternoon and had not noticed this point until this morning. Perhaps the matter could be clarified at some other stage.
The LORD CHANCELLOR: My Lords, it is a little difficult to see what other stage we could have, save in another place. I will certainly look into the point and communicate with the noble Lord. The words which appear in my copy of the Amendment are "to which the employer belongs" and that would seem to follow sensibly after the words "or an employers' association". It may be that the mischief is merely a misprint in the copy which the noble Lord has, but if it is not I will let him know.
Lord LLOYD of KILGERRAN: My Lords, I am very much obliged to the noble and learned Lord.
The LORD CHANCELLOR: My Lords, the explanation of this mystery is that the lining of the copy of the Amendment supplied to the noble Lord, Lord
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Lloyd of Kilgerran, is different from mine and I fear that we are talking about a different noun in the Amendment. However, I am advised that the relevant reference is "employee" and I am further advised that this has the effect that the noble Lord. Lord Nelson of Stafford, had in mind and desired. I hope that that reassurance will comfort Lord Lloyd.
On Question. Amendment agreed to.
Clause 38 [Amount of compensation]:
3.28 p.m.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 16:
Page 32, line 37, leave out ("and").
The noble and learned Lord said: My Lords, it may be convenient for the House to discusss Amendment No. 17 as well. On Report, when your Lordships were discussing Amendments Nos. 53A, 53B and 53C set down by the noble Lord, Lord Nelson of Stafford, I accepted that it would he right to add to the list of matters required to be taken into account under what is now Clause 38(5)—where the fair share of the benefit to be secured to an employee in respect of an invention which originally belonged to him is being determined—a reference to the employer's contribution to the developing and working of the invention. This Amendment carries that into effect. Perhaps I should add at this juncture that the Government are continuing to give consideration to the question whether any of the other matters specified in Clause 38(4) should also be added to Clause 38(5).
When we discussed this previously, again I accepted that reference should also be added to the marketing of the invention, provided that was necessary and appropriate. The Parliamentary draftsman has been consulted on this and he has advised that "marketing" is already comprised within the meaning of "working" and so does not need to be specifically mentioned. I confess that that is a proposition which caused me no little surprise, but that is the wisdom and guidance that I have received and I invite noble Lords to accept the view that it does not need to be mentioned specifically, and accordingly the word "marketing" does not appear

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in the Amendment. I fear that no Amendment has been tabled to insert it into what is now Clause 38(4)(d), but we are here in the presence of the esoteric skills of Parliamentary draftsmen and I am disposed to invite your Lordships to accept that view. I beg to move.
Lord BELSTEAD: My Lords, on behalf of my noble friend Lord Nelson of Stafford, should like to thank the noble and learned Lord for his explanation of the Government Amendment. Like him, I am a little surprised that the word, "marketing" should be subsumed in the word, "working", but I accept what the noble and learned Lord has said and I therefore support the Government Amendments.
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 17:
Page 32, line 39, at end insert ("and
(c) the contribution made by the employer to the developing and working of the invention as mentioned in subsection (4)(d) above").
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 18:
Page 33, line 17, at end insert—
("(11) In Northern Ireland an order made under section 37 above by the comptroller for the payment of any sums may be enforced as if it were a money judgment.").
The noble and learned Lord said: My Lords, this Amendment adds a new subsection (11) to Clause 38 providing that in Northern Ireland an award of compensation made by the comptroller under Clause 37 may be enforced in the same way as if it were a money judgment. Accordingly, it inserts a provision for Northern Ireland which corresponds to what subsection (9) provides for England and Wales and subsection (10) does for Scotland. I beg to move.
On Question, Amendment agreed to.
Clause 39 [Enforceability of contracts relating to employees' inventions]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 19:
Page 33, line 31, at end insert—
"(2A) Subsection (2) above shall not be construed as derogating from any duty of
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confidentiality owed to his employer by an employee by virtue of any rule of law or otherwise".
The noble and learned Lord said: My Lords, at the Report stage, I accepted in principle the point which the noble Lord, Lord Nelson of Stafford, was making in his Amendment No. 56A and I undertook to table an Amendment expressly providing that what is now Clause 39(2) does not render unenforceable a term in a contract of employment imposing an obligation of confidence upon an employee. The Amendment now before your Lordships fulfils that undertaking. I beg to move.
Lord LYELL: My Lords, as one who spoke rather strongly in favour of such a clause at an earlier stage of the Bill, I can say that we are all very grateful to have a note of wit and charm injected into the proceedings by the noble and learned Lord who sits upon the Woolsack, and, on behalf of my noble friend Lord Nelson of Stafford, I should like to say that we are happy that the noble and learned Lord has gone as far as he can—I believe, effectively—to satisfy what was in the mind of my noble friend Lord Nelson.
Lord LLOYD of KILGERRAN: My Lords, I should like to support what the noble Lord, Lord Lyell, has said. This has reduced the serious anxieties of industry in regard to confidentiality. Although the law of confidence in these matters is still fairly clear, this has been a very helpful Amendment.
The LORD CHANCELLOR: My Lords, I am grateful for those two interventions. This shows how helpfully we have worked together to try to get the best possible Bill out of this extremely technical subject of patent law—a subject which I managed successfully to avoid during my whole career at the Bar.
On Question, Amendment agreed to.
3.37 p.m.
Lord ORAM Lord ORAM moved Amendments Nos. 20 to 28:
Clause 52, page 46, line 34, leave out ("a patented") and insert ("an").
Clause 52, page 46,line 41, leave out from first ("of") to second ("any") in line 43 and insert ("a relevant communication made in confidence")
Clause 52, page 46, line 47, leave out from ("time") to

575
("shall") in line 2 on page 47 and insert ("either—

(a) after the publication of the application for the patent for the invention; or

(b) without prejudice to paragraph (a) above, in consequence of a relevant communication made after the priority date of the invention otherwise than in confidence;").

Page 47, line 7, at end insert—
("(4A) Where an invention is used by virtue of this section at any time after publication of an application for a patent for the invention but before such a patent is granted, and the terms for its use agreed or determined as mentioned in subsection (4) above include terms as to payment for the use, then (notwithstanding anything in those terms) any such payment shall be recoverable only—

(a) after such a patent is granted; and

(b) if (apart from this section) the use would, if the patent had been granted on the date of the publication of the application, have infringed not only the patent but also the claims (as interpreted by the description and any drawings referred to in the description or claims) in the form in which they were contained in the application immediately before the preparations for its publication were completed by the Patent Office").

Page 47, line 19, leave out ("use is begun") and insert ("second of the following events, that is to say, the use is begun and the patent is granted").
Page 47, line 25, at end insert—
("(7A) In this section "relevant communication", in relation to an invention, means a communication of the invention directly or indirectly by the proprietor of the patent or any person from whom he derives title.
(7B) Subsection (4) above is without prejudice to any rule of law relating to the confidentiality of information.")
Clause 53, page 47, line 32, leave out from beginning to end of line 7 on page 48 and insert—
("(1) Any reference in section 52 above to a patented invention, in relation to any time, is a reference to an invention for which a patent has before that time been, or is subsequently, granted").
Clause 55, page 51, line 30, at end insert ("after a patent has been granted for the invention ").
Page 52, line 28, at end insert—
("(6A) Where by virtue of a transaction, instrument or event to which section 30 above applies a person becomes the proprietor or one of the proprietors of an exclusive licensee of a patent and a government department or a person authorised by a government department subsequently makes use under section 52 above of the patented invention, that person shall not be entitled to any compensation under section 52(4) above (as it stands or as modified by section 54(3) above) in respect of a subsequent use of the invention before the transaction, instrument or event is registered unless—

(a) the transaction, instrument or event is registered within the period of six months beginning with its date; or

(b) the court is satisfied that it was not practicable to register the transaction,
576
instrument or event before the end of that period and that it was registered as soon as practicable thereafter.").

The noble Lord said: My Lords, before I speak to the Amendments, I should like, with your Lordships' permission, to refer to the point raised by the noble Lord, Lord Lloyd of Kilgerran, in connection with Amendment No. 14. The noble Lord asked whether the point involved was a new one. I am advised that the Amendment was consequential upon Amendments No. 42 and 112 which were agreed at Report stage. They made a provision in respect of the comptroller and Amendment No. 14 does the same for the court. So this is not an entirely new point but is a consequential one.
Turning to the Amendments, they are all primarily of a drafting character, although they make certain minor changes necessary to bring the Crown use provisions into accord with the principles underlying the remainder of the Bill. If any of your Lordships wishes me to answer any point on them, I will try to do so either now or by letter, but I do not think that it would be helpful in general for me to go through the changes in detail. I beg to move Amendments Nos. 20 to 28 en bloc.
Lord BELSTEAD: My Lords, I should like to pick up a drafting point in Amendment No. 28 which reads:
"Where by virtue of a transaction, instrument or event to which section 30 above applies a person becomes the proprietor or one of the proprietors or an exclusive licensee of a patent and a government department or a person authorised by a government department subsequently makes use under section 52 above of the patented invention, that person shall not be entitled…"
I am wondering who "that person" refers to.
Lord ORAM: So am I, my Lords. If the noble Lord agrees, I shall look into this and write to him. If there is any clarification needed in the text of the Bill, there will of course be an opportunity in another place to put it right but I anticipate that I shall be able to write to the noble Lord, Lord Belstead, making the position quite clear.
Lord LLOYD of KILGERRAN: My Lords, as the noble Lord, Lord Oram, did not indicate that the Amendments were purely formal and as they relate to the powers of the Crown in relation to

577
patented inventions, I wonder whether I may accept the offer made by the noble Lord that he would write explaining more fully the details of these Amendments rather than going through them now.
Lord ORAM: My Lords, if the noble Lord so wishes, that can readily be done. I shall send him a note which covers all the Amendments in rather more detail, although I reiterate that they are essentially drafting Amendments incorporating some minor changes.
Lord BELSTEAD: My Lords, I only wish to say that my understanding would have been that the adjective "that" in the expression "that person" related to the second person who is referred to in this Amendment, and the second person is a Government Department or a person authorised by a Government Department. However, when one comes to read the Amendment, it is quite clear that the words "that person" do not refer to the second person so mentioned but to the first person. If I may and if the Parliamentary draftsmen will allow a suggestion from the Opposition Benches, I therefore suggest that the sixth line of the Amendment should read, "that person first mentioned".
Lord ORAM: I am sure that the Parliamentary draftsmen have become used to accepting advice from very many quarters and that will include the noble Lord.
On Question, Amendments agreed to.
Clause 58 [Proceedings for infringement of patent]:
Lord ORAM Lord ORAM moved Amendment No. 29:
Page 57, line 2, at end insert—
"( ) The Arbitration Act 1950 shall not apply to proceedings before the comptroller under this section."
The noble Lord said: My Lords, this Amendment makes it clear that a reference to the comptroller under subsection (3) is not to be treated as an arbitration. Any doubt about the matter is thus removed. Perhaps I may mention that a similar provision is contained in Section 67 of the existing Patents Act. I beg to move.
On Question, Amendment agreed to.
Clause 66 [Infringement of rights conferred by publication of application]:
3.40 p.m.
Lord ORAM Lord ORAM moved Amendment No. 30:
Page 60, line 8, leave out ("that subsection") and insert ("subsection (2) below").
The noble Lord said: My Lords, this is a purely drafting Amendment to remove an ambiguity, making it clear that the subsection referred to in line 8 is subsection (2) of Clause 66 and not subsection (5) of Clause 71, both of which are referred to in line 2. I beg to move.
On Question, Amendment agreed to.
Lord ORAM Lord ORAM moved Amendment No. 31:
Page 60, line 19, leave out from second ("the") to end of line 21 and insert ("claims (as interpreted by the description or any drawings referred to in the description or claims) in the form in which they were contained in the application immediately before the preparations for its publication were completed by the Patent Office").
The noble Lord said: My Lords, before speaking to this Amendment I should like to call attention to a clerical error in the text. It should read:
"… as interpreted by the description and any drawings referred to… "
I wish to thank the noble Lord, Lord Belstead, for having pointed out this error in the text. This Amendment makes it clear that it is the claims in the form in which they are when the preparations for publication have been completed which will determine the provisional protection under Clause 66. These claims will of course be published and it would be wrong, as I said when moving Amendment No. 5 to Clause 15, to take into account any later non-published claims for Clause 66 purposes. I beg to move.
On Question, Amendment agreed to.
Clause 69 [Power to revoke patents on application]:
Lord LYELL Lord LYELL moved Amendment No. 32:
Page 62, line 27, at end insert—
("( ) A decision of the comptroller or an appeal from the comptroller shall not estop any party to civil proceedings in which infringement of a patent is in issue from alleging invalidity of the patent on any of the grounds

579
referred to in subsection (1) above, whether or not any of the issues involved were decided in the said decision.")
The noble Lord said: My Lords, I hope that the House will not lose patience at this late stage in the Bill's proceedings either with me or with my colleagues as we bring out once again the—dare I say it? —fascinations of the law of estoppel. Noble Lords will notice that the Amendment, which appears in my name and the names of my noble friends, is identical to those Amendments moved at both Committee stage and Report stage by my noble friend Lord Belstead and myself.
Briefly, we consider that as the Bill stands in its present form it does not make it clear that a litigant will be able to protect himself in any infringement proceedings which may, or probably will, follow from an unsuccessful revocation action. I should like to thank warmly the noble Lord, Lord Oram, for what I would call the flood of information and communications that has surged between us, mostly, I am happy to say, in my direction. I have been happy that the noble Lord, Lord Oram, has agreed with our point little by little, and indeed in communications outside the House he has been able to indicate that in almost all the details our Amendment was acceptable, but he had one or two minor reservations.
In his previous replies, the noble Lord, Lord Oram, believed that Clause 72(1)(a), which was indeed part of a Government Amendment, would meet our difficulty. However, I am afraid that we were not entirely of the same opinion. We consider that Clause 70(5) removes the right of an appeal to the court, except by leave of that court, and I think that I have it right when I say that Clause 70(5) will, without our Amendment, effectively estop a litigant from pleading the same evidence as he used, or indeed as was used, in revocation when he is pleading in the infringement action.
I understand that the comments of the noble Lord, Lord Oram, were part and parcel of what is known as action estoppel—concerning the validity or the obviousness of the patent—whereas our Amendment, we believe, deals with issue estoppel, and it is this aspect of the law of estoppel which, I am told, and so far as I can decipher it, is equivalent to the term, as
580
so nicely used by the noble Lord, Lord Oram: res judicata.
At the Report stage the noble Lord, Lord Lloyd of Kilgerran, mentioned the great cost of taking an appeal to the Patents Court or to the Court of Appeal. We are of the opinion that should our Amendment not be written into the Bill, a certain amount of what we call robust, swift, and effective justice would be lost. It is on these three appealing grounds, as I hope they are, that once again I beg to move the Amendment.
Lord ORAM: My Lords, the noble Lord, Lord Lyell, has indeed been diligent in pursuing this particular point, and quite rightly from his point of view. I indicated during the Report stage that the Government are indeed aware of the importance of the point that the noble Lord has been pursuing, since its insertion or omission from this Bill may well affect the attitude of persons when exercising their choice of either applying for revocation before the comptroller or before the Patents Court. During the Report stage I indicated that the Government were prepared to agree that there should be no estoppel so far as concerns prior decisions of the comptroller or the Patents Court on appeal from the comptroller. However, we had some misgivings, which I explained, about giving the same effect to prior judgments of the Court of Appeal and the House of Lords. The noble Lord, Lord Belstead, was good enough to say that he understood our misgivings on that point, and I, on the other hand, agreed to give further consideration to the matter.
I am glad to say that, as a result, we are now quite prepared to accept this Amendment, in the full realisation that a new situation arises through giving the comptroller, as everyone agrees, the same jurisdiction in respect of revocation on the court. So, if I may say so, this is a case of patience rewarded.
Lord LYELL: My Lords, we on this side of the House can only be immensely grateful to the noble Lord, Lord Oram, for the kind way in which he has seen fit to accept our points. I particularly enjoyed his latter comments, and I wondered whether it would be apposite that we should call this, together with a new concept of the law of estoppel, "Oram's revenge". I am

581
very happy to accept that the Government have seen our point, and we are very grateful.
On Question, Amendment agreed to.
Lord BELSTEAD Lord BELSTEAD moved Amendment No. 33:
After Clause 69 insert the following new clause: Effect of disclosure of matter on application where such disclosure occurs after filing earlier relevant application.
Where an invention to which an application for a patent relates has the priority date of an earlier relevant application pursuant to section 5 above, then, notwithstanding anything in this Act, the comptroller shall not refuse to grant the patent, and the patent shall not be revoked or invalidated by reason only that any matter disclosed in the earlier relevant application was used or published or taken to be comprised in the state of the art at any time on or after the date filing the earlier relevant application.
The noble Lord said: My Lords, I beg to move Amendment No. 33, which has already been twice discussed. I ventured to put it down again because I am advised, and I must say I believe, that if this Amendment is not written into the Bill, the consequences will be unfair to inventors, undesirable in the national interest, and inconsistent with the existing law for the United Kingdom, and inconsistent, too, with the Paris Convention which extends virtually worldwide.
Positively for the last time in these proceedings I will again introduce an old friend into the debate: the inventor who discovers a new method for fixing uppers to the soles of a pair of shoes. He applies for a patent, but soon after he publishes an article about it in the Shoemakers' Gazette; and then, within a year from the date of filing his application for shoes, the inventor files another application, using the same invention, for fixing blinds to their rollers and canvas hoods to the roofs of cars. I suggest that the new application for shoes, roller blinds and car hoods is a single generic claim for fixing flexible matter to a stiffer backing.
The difficulty which I am trying to put before your Lordships is that under Clause 2(2) of the Bill, which provides that the state of the art:
"shall be taken to comprise all matter… which has at any time before the priority date of that invention been made available to the public… by written or oral description, by use or in any other way",
582
the second application for shoes, blinds and car hoods has been anticipated by the disclosure of the invention which was written about in the Shoemakers' Gazette.
The noble Lord, Lord Oram, was good enough to write to me on the 13th May, and in the noble Lord's letter there were these words:
"Your question arose out of a hypothetical example of an invention which was expressed narrowly in a priority document and generically in a definitive United Kingdom application. I cannot of course say how the courts might decide the validity of the patent in that particular case, but I can say that under the Bill as it stands the patent could be held invalid because of the publication of the invention in the Shoemakers' Gazette, whereas it could not be held invalid if the Amendment were adopted".
The noble Lord then went on to say that he was well aware of the importance of the issues raised by this Amendment, and felt that the right thing to do was to refer the question to the Standing Advisory Committee on Patents to get their views on it. Indeed, I am well aware that the noble Lord takes this as being an important Amendment, because he has been good enough not only to write to me about it on two occasions but also to reply to me at length on the Floor of the House. For those reasons, my Lords, I should very much like to accept the invitation which has been given to me in writing that this matter should be put to the Standing Advisory Committee, but I hope the noble Lord will not take me as being unduly difficult over this if I say that I really do not think that I can do this at this final stage of the Bill.
My understanding is that it has been common practice for patent applicants to publish an account of their inventions after they have filed a provisional patent application—a method, of course, which is going to be done away with by this Bill. Inventors may also try to go round persuading manufacturers to take out a licence without trying to impose any obligation of secrecy upon those manufacturers; and then, as the method has been used by many inventors in the past, a complete specification is filed provided it is within a year, and Section 52 of the 1949 Act protects the inventor whether or not his final claim is drawn in broad or in narrow terms.
My Lords, this Amendment really corresponds directly to Section 52 of the

583
1949 Act; and, as I said earlier, if it is not agreed to I think it will be unfair to inventors, who are going to be very wary of exploiting their inventions at all during the first year after they have discovered them and filed the applications for them. For the same reason, I think this postponement will not be in the national interest; and, as I have been trying to argue, I do not think it is consistent with the existing law.
My Lords, there is one other difficulty. If the noble Lord will forgive me, I will put it before I finish moving this Amendment, and it is this. I think that refusal of this Amendment will make the law of our country inconsistent with Article 4B of the Paris Convention. I have tried to refer to that Convention before, but on this occasion may I say this? The Convention is absolutely specific on this subject. In Article 4B it is provided:
"Any application for a patent in any of the countries of the Union has one year to file a corresponding application in other countries and obtain priority for the first filing, and the applicant may disclose his first invention in the interim year".
The Paris Convention then goes on specifically to say that the second application shall not be invalidated,
"by reason of any acts"—
"any acts", my Lords—
"accomplished in the interval".
I do not think that the Bill as drafted corresponds to that provision.
The noble Lord, Lord Oram, made the perfectly valid objection, when this Amendment was being moved at an earlier stage, that the European Patent Convention, which is one of the two Conventions which of course we are attempting to harmonise with, is silent on this subject. My Lords, if noble Lords on the Government Front Bench would care to glance at the Preamble to the European Patent Convention, they will see that the Convention,
"constitutes a special agreement within the meaning of Article 19 of the Paris Convention".
My Lords, if the EPC does not include an equivalent provision to Section 52 of the 1949 Act, I suggest it is because Article 4B of the Paris Convention is doing so and the EPC is operating within, and not outside, the terms of the Paris Convention.
It is for those reasons—and I apologise for the length of time in moving this Amendment—that I believe that this Amendment is necessary. It will continue the effect of Section 52 of the 1949 Act; it will correspond with Article 4B of the Paris Convention; and I do not think there is anything in the EPC which is inconsistent with it. My Lords, I beg to move.
Lord LLOYD of KILGERRAN: My Lords, may I briefly support what the noble Lord, Lord Belstead, has said about this Amendment, which in effect is referred to as the Section 52 type Amendment? It is of special interest, in my view, to the small inventor and the small firm; and I have already declared an interest to your Lordships in that I have the privilege of being the president of the Institute of Patentees and Inventors. In view of the confession made by the noble and learned Lord about his practice at the bar, that he escaped patent law during the course of his practice, perhaps I may say that I have had the privilege of escaping every branch of the law except the patents and trademarks law.
My Lords, this Amendment deals with the independent inventor and the small-sized company, which frequently, when they make an invention, disclose their invention after filing a provisional specification in order to attract financial support. Such disclosure may be in a technical journal which can be read by the examiner at the Patent Office during his examination of the later, complete specification. Therefore, I should like to support this Amendment, so well introduced by the noble Lord, Lord Belstead.
Lord ORAM: My Lords, as the noble Lord, Lord Belstead, has said, this is an old friend. It has indeed been much discussed during the Committee and Report stages of the Bill, and we have considered carefully everything that noble Lords opposite have said with a view to seeing whether we could possibly meet their wishes; but I am sorry to say that, unlike the last Amendment with which we were dealing, that has not been possible in this case. As has been said before, this Amendment has the effect of introducing into the Bill a provision which corresponds to Section 52 of the 1949 Act. In that Act it may have some merit; but as to whether or not that is true we

585
cannot really say because research has not detected any case in which this section of the 1949 Act has been used. From this, I think it is not unfair to deduce that the provision which this Amendment seeks to introduce is not concerned with a matter that can be said to be of great practical importance.
Nevertheless, I have to admit to the existence of Section 52, and I must answer the charge that there is no case for omitting this provision from the new patent law. But, my Lords, it has to be realised that the new law is being established in a different framework from the 1949 Act. Throughout our deliberations, noble Lords on all sides of this House have been saying that we must line up with the European Patent Convention. We must avoid duality of standards in this country: British, European and Corn-mutiny patents must be treated alike. This is common ground, accepted by your Lordships and anxiously desired by industry, commerce, patent agents, barristers, solicitors and everyone else concerned with patents. Indeed, the Government have, sometimes at the express wish of the patent interests, moved numerous Amendments with a view to bringing into close alignment the new law with these Conventions. But here we have an Amendment producing an effect which is not, in our view, produced by the European Patent Convention. Indeed, the noble Lord, Lord Belstead, admitted during the Report stage that he took a similar view. Noble Lords opposite appear, therefore, to be moving once again an Amendment which is likely to introduce that duality of standards which they and everyone else wish to avoid.
It is, as I understand it, argued that the omission of such a provision from the European Convention is rectified by Article 4B of the Paris Convention since the European Convention does not derogate from the provisions of the Paris Convention. I do not say that the two Conventions are in conflict—far from it! —because in the view of the Government the European Convention does give effect to Article 4B of the Paris Convention in that it makes clear that a disclosure of an invention after its priority date does not destroy the novelty of the claims of the patent application directed to that invention. What noble Lords opposite are saying is that this article goes much
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further and also safeguards any development of the basic invention from a disclosure of that basic invention made after the priority date of that invention. As I have already said, we do not take this view; it not only seems wrong in principle but it is not borne out by the European Patent Convention. It is this Convention with which the new law is to be aligned without in any way running counter to the obligations which this country has under the Paris Convention.
My Lords, this is a difficult technical matter. I think I have understood what noble Lords opposite are driving at, and there are two further points that I feel that I must make. During the Report stage, and again today, the noble Lord, Lord Belstead, illustrated his point with his famous example. According to this example, the applicant, after filing an application for a patent for an invention which is a method of attaching uppers to the soles of shoes, publishes an article about his invention and then later files a second application, claiming the priority of the first application, describing the application of the same method not only to shoes but also to fixing blinds to their rollers and canvas hoods to the roofs of cars, and claiming broadly a method of fixing flexible matter to a stiffer backing. The noble Lord acknowledged that this broad claim would not attract the priority date of the first application; in other words, the invention as broadly claimed takes the filing date of the second application, this being later than the date of the article published by the applicant.
The noble Lord then asked me whether the second application was anticipated by the published article, having regard to Clause 2(2). Unfortunately I gave, off the cuff, the wrong answer and I am, of course, sorry about this. What I should have said was that the broad claim would lack novelty, since its priority date is later than the date of the article. But this is not the end of the story, because it would be possible to split the claim, notionally or actually, into one for (a) the method as applied to shoes, and the other or others for (b) the method as applied to roller blinds and car hoods. The claim to (a) would take the priority date of the first application and hence would not lack novelty. The claim or claims to (b) would, of course, also not lack novelty, since the article gave no indication of applying the

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method to blinds and car hoods. It may be argued that the claim to (b) lacks inventive step. I agree that this is so, but whether it would succeed depends on the facts; and all that I can say on this point is that if it is so obvious to apply the method disclosed in the article to roller blinds and car hoods, then I am inclined to the view that the broad generic claim may well attract the priority date of the first application; in which event, of course, no problem arises.
This leads me directly to my second point which is that this Amendment, as I understand it, does not serve the purpose which noble Lords opposite intend. The safeguard that it contains against invalidation by reason of use or publication of the matter disclosed in the first application is based, according to the Amendment, on the premise that the invention (that is, the broad generic claim) has the priority date of the first application. My Lords, if this premise is satisfied then the safeguard provided by the Amendment is unnecessary; it is already given by the express terms of Clause 2 because the public disclosure of the content of the first application takes place after the priority date of the generic claim.
My Lords, for all these reasons, I ask noble Lords opposite once again to withdraw their Amendment. Although the noble Lord, Lord Belstead, indicated that he read my letter, which summarised the case that I have been deploying at greater length, and still indicates that he is not satisfied, nevertheless I ask him to consider withdrawing the Amendment. It is, as I understand it, a highly technical matter with no political content but one on which there can be a difference of view. Because of this, as the noble Lord indicated when he quoted my letter, the Government are quite prepared to look yet again at this matter, and I can tell the House that the advice of the members of the Standing Advisory Committee on patents has been sought on this point. Unfortunately, however, there has been insufficient time to complete the consultation process, but I can assure your Lordships that if, on receipt of this advice, the Government are convinced that an Amendment on the lines now proposed is indeed necessary, they will be prepared to deal with the matter in another place. The Government are not,
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as has been suggested, intending to be infair to inventors and to delay exploitation of their inventions by the present rejection of this Amendment. Their sole concern is to adopt sound principles of patent law which are in conformity with the European Patent Convention. I repeat, therefore, that I hope noble Lords opposite will be prepared to withdraw this Amendment.
4.9 p.m.
Lord DOUGLAS of BARLOCH: My Lords, I have tried to follow this argument and as I understand it, my noble friend Lord Oram is resting on the grounds that the Amendment is unnecessary because the point in question would be covered by the Bill without this Amendment. I must confess that I have failed to understand what reasons there can be for suggesting this. If this point is correct. he is saying, in fact, that the substance of the Amendment is desirable but that he thinks it is already in the Bill. I doubt this very much. I confess that it is a long time since I practised in the Patent Office, but my recollection is that the approach of the Patent Office to applications for patents is extremely narrow and restrictive, and it is not at all willing to give a wide construction to what the inventor has said in his specification. I therefore feel a little unhappy that this provision in the Amendment should not be accepted.
4.10 p.m.
Lord BELSTEAD: My Lords, I am grateful to the noble Lord, Lord Douglas of Barloch, for coming to my rescue, because rescue I need in that I am not sure I am so grateful to the noble Lord, Lord Oram, for speaking—as he always does—with great care and, on this Amendment, at some length to try to explain why the Government will not agree to it. I found it more difficult to follow his explanation as he went on; the fault was not his entirely but mine. The noble Lord said that researches had shown that this had not, so far as could be seen, been used at all. I find that statement astonishing in view of what the noble Lord, Lord Lloyd of Kilgerran, said when he was good enough to intervene for a moment or two. The inventor, who I put forward for the "umpteenth" time. who makes his shoes, roller blinds and car hoods, precisely falls foul of the fact that this provision is not in the Bill at the

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present time. As I understood him, towards the end of his remarks the noble Lord said that my second application example, the broad generic one, could claim earlier priority and therefore there should not be this problem which I am putting forward.
I hesitate to refer to anything that I have said, but with respect I will refer to what I ventured to put forward to the Government on the Committee stage, that the inventor who I used as an example can be caught both ways. I apologise for quoting my own words, but I said this at column 60 of Hansard on 9th May:
"The Government may say, 'Under Clause 5(2), if an application is supported by matter contained in an earlier application, the second application can take the earlier priority date'. But the second generic claim, the one for the three things, is in this case not so supported by the earlier application for shoes alone, beause if there is an invention which is limited in its scope—in this case only shoes—it is very doubtful whether it would be held with a broader claim for different articles (in this case roller blinds and car hoods as well as shoes) as being supported by matter in the earlier application for shoes alone. Anyway, it could be argued that work on blinds and car hoods are different arts so far as shoes are concerned".
Having said that, I ventured to put one other point to the Government. I said at the bottom of column 60:
"The second generic claim can be said now to have been anticipated by the disclosure in the Shoemakers' Gazette,…"
It is that point which the noble Lord in his letter confirmed is correct. In this case, my unfortunate inventor is caught both ways.
The noble Lord, understandably, put to us his views about the Paris Convention. I must just gently say to the Government that, in the course of the long proceedings that we have had on this Bill, from time to time Ministers, when they felt it was the right thing to do, have told us that the European Patent Convention and Community Patent Convention are only indicative. Indeed, when we had quite a long debate on what is now Clause 122(7) many noble Lords on the Government Front Bench defended the wording of the Bill which states that a great many clauses of the Bill will be as similar as possible to the EPC and the CPC, because the EPC and the CPC are indicative and we do not have to stick exactly to them.
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I am going to use that argument now and say that the Paris Convention in Article 4B is absolutely specific on this matter. I quoted the very words:
"…by reason of any acts accomplished in the interval so a second application shall not be invalidated by what is being done between it and a first application to which it may refer".
I am saying that although the EPC is silent on this matter, that indicates that it approves of what is in the Paris Convention. I simply put it to the House that I believe that this Amendment compares exactly to Section 52 of the 1949 Act, which is the law at the present time, and to Article 4B of the Paris Convention. I venture to suggest to your Lordships that the Amendment should be written into the Bill.
Lord ORAM: My Lords, if I may briefly reply, I need only be brief because it is clear from the speech to which we have just listened that if I were to deploy the full argument again I doubt whether we would reach agreement or would persuade the noble Lord to withdraw his Amendment. If I may refer to what the noble Lord, Lord Douglas of Barloch, said, I do not think I said—or certainly I did not mean to imply—that the Amendment is already covered by the Bill; rather was it the basis of my case that the Amendment would introduce a provision that would put it out of line with the European Patent Convention. There may be argument about this, but that is what I intended to convey.
As I said, this is a highly technical matter which has been pursued with great diligence many times. I had hoped that the information I gave about our reference of such a technical matter to the people who can really best advise us, namely, those on the Standing Advisory Committee, and the undertaking that I then gave—namely, that if they felt that an Amendment of this kind were necessary, we would introduce it in another place—was a perfectly reasonable suggestion to put to your Lordships. But if that is not considered a satisfactory approach to this matter—and I understand that the noble Lord, though accepting it is useful, is not satisfied that it is sufficient for him to withdraw his Amendment—then so be it. We must put the matter to the view of the House.
4.17 p.m.
On Question, Whether the said Amendment (No. 33) shall be agreed to?
Resolved in the affirmative, and Amendment agreed to accordingly.
Their Lordships divided: Contents,116; Not-Contents 61.

CONTENTS

Airedale, L.

Emmet of Amberley, B.

Monck, V.

Aldenham, L.

Evans of Hungershall, L.

Newall, L. [Teller.]

Alexander of Tunis, E.

Falkland, V.

Northchurch, B.

Allan of Kilmahew, L.

Ferrers, E.

Nunburnholme, L.

Alport, L.

Faversham, L.

O'Hagan, L.

Amherst, E.

Fraser of Kilmorack, L.

Orr-Ewing, L.

Ampthill, L.

Gainford, L.

Platt, L.

Arran, E.

Gisborough, L.

Rankeillour, L.

Avebury, L.

Gladwyn, L.

Reigate, L.

Avon, E.

Glenkinglas, L.

Robbins, L.

Balfour of Inchrye, L.

Gray, L.

Rochester, L.

Banks, L.

Grey, E.

Romney, E.

Barnby, L.

Gridley, L.

Ruthven of Freeland, Ly.

Belstead, L.

Hailsham of Saint Marylebone,L.

Sackville, L.

Berkeley, B.

St. Aldwyn, E.

Blake, L.

Halsbury, E.

St. Davids, V.

Boyd-Carpenter, L.

Hanworth, V.

St. Helens, L.

Broadbridge, L.

Harmar-Nicholls, L.

Salisbury, M.

Byers, L.

Hatherton, L.

Savile, L.

Caccia, L.

Hawke, L.

Spens, L.

Carrington, L.

Hayter, L.

Stamp, L.

Cathcart, E.

Hemphill, L.

Strang, L.

Chelwood, L.

Henley, L.

Strathspey, L.

Clitheroe, L.

Hylton-Foster, B.

Swansea, L.

Clwyd, L.

Ilchester, E.

Teynham, L.

Cork and Orrery, E.

Ironside, L.

Thomas, L.

Cottesloe, L.

Jessel, L.

Tranmire, L.

Daventry, V.

Kings Norton, L.

Trefgarne, L. [Teller.]

Davidson, V.

Kinloss, Ly.

Vernon, L.

de Clifford, L.

Kinnaird, L.

Vickers, B.

De Freyne, L.

Leinster, D.

Vivian, L.

Derwent, L.

Lindsey and Abingdon, E.

Wade, L.

Digby, L.

Lloyd of Kilgerran, L.

Waldegrave, E.

Douglas of Barloch, L.

Long, V.

Ward of North Tyneside, B.

Drumalbyn, L.

Lyell, L.

Ward of Witley, V.

Effingham, E.

McNair, L.

Willingdon, M.

Ellenborough, L.

Mancroft, L.

Windlesham, L.

Elles, B.

Marley, L.

Wise, L.

Elton, L.

Merrivale, L.

Young, B.

NOT-CONTENTS

Ardwick, L.

Jacques, L.

Roberthall, L.

Aylestone, L.

Janner, L.

Samuel, V.

Blyton, L.

Kennet, L.

Segal, L.

Brimelow, L.

Kilbracken, L.

Shepherd, L.

Brockway, L.

Leatherland, L.

Shinwell, L.

Bruce of Donington, L.

Lee of Newton, L.

Stedman, B.

Burntwood, L.

Listowel, E.

Stewart of Alvechurch, B.

Burton of Coventry, B.

Llewelyn-Davies of Hastoe, B.

Stone, L.

Castle, L.

Lloyd of Hampstead, L.

Strabolgi, L.

Champion, L.

Lovell-Davies, L.

Taylor of Mansfield, L.

Chorley, L.

McCarthy, L.

Wallace of Coslany, L.

Cooper of Stockton Heath, L.

Milford, L.

Walston, L.

Crowther-Hunt, L.

Northfield, L.

Wells-Pestell, L. [Teller.]

Darling of Hillsborough, L.

Oram, L.

White, B.

Davies of Penrhys, L.

Pannell, L.

Willis, L.

Elwyn-Jones, L. (L. Chancellor)

Pargiter, L.

Wilson of RadclifTe, L.

Gaitskell. B.

Parry, L.

Winterbottom, L. [Teller.]

Gordon-Walker, L.

Peddie, L.

Wootton of Abinger, B.

Granville of Eye, L.

Phillips, B.

Wynne-Jones, L.

Greenwood of Rossendale, L.

Raglan, L.

Henderson, L.

Ritchie-Calder, L.

Clause 70 [Comptroller's power to revoke patents on his own initiative]:
4.26 p.m.
Lord ORAM Lord ORAM moved Amendment No. 34:
Page 63, line 8, at end insert—
("(2) If it appears to the comptroller that a patent under this Act and a European patent (UK) have been granted for the same invention having the same priority date and that the applications for both patents were filed by the same applicant or his successor in title, the comptroller may, on his own initiative but only after the relevant date, consider whether to revoke the patent granted under this Act and may, after giving the proprietor of the patent an opportunity of making any observstions and of amending the specification of the patent, revoke the patent.
(3) In this section "the relevant date" means whichever of the following dates is relevant, that is to say—

(a) the date on which the period for filing an opposition to the patent under the European Patent Convention expires without an opposition being filed;

(b) the date when any opposition proceedings under that convention are finally disposed of by a decision to maintain the European patent;

(c) if later than either of the foregoing dates, the date when the patent under this Act is granted").

The noble Lord said: My Lords, this Amendment provides for revocation by the comptroller, on his own initiative, of a patent under the Bill in cases where the proprietor has also obtained a European patent designating the United Kingdom for the same invention having the same priority date. Certain safeguards are, however, provided. First, the proprietor must be given an opportunity to make observations and to amend his patent. Secondly, no action can be taken by the comptroller until the period provided under the European Patent Convention for filing an opposition to the European patent has expired with no opposition having been filed or, if an opposition has been filed, until the opposition has been determined in the proprietor's favour. In other words, the comptroller will not be able to revoke a patent under this subsection until it is clear that two patents, one a Bill patent and the other a European patent, have been granted and the possibility of revocation of the European patent under the EPC has passed. These safeguards are analogous to those provided by Article 80 of the Community Patent Convention which deals with the
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same problem vis-à-vis Community patents and national patents. I beg to move.
On Question, Amendment agreed to.
Clause 71 [Proceedings in which validity of patent may be put in issue]:
Lord ORAM Lord ORAM moved Amendment No. 35:
Page 63, line 31, leave out from second ("in") to ("it") in line 33 and insert ("any proceedings unless—

(a) a reference to the comptroller of a question mentioned in section 34(1)(a) above has been made complying with section 34(5) above;

(b) proceedings for a declaration or declarator as to any such question have been commenced complying with section 34(9) above; or

(c) in the case of any other proceedings, they are commenced before the end of the period of two years beginning with the date of the grant of the patent or").

The noble Lord said: My Lords, this Amendment puts right a defect in the existing Clause 71(4). Under subsection (4) as drafted a rightful owner could only put invalidity in issue in any proceedings on the ground mentioned in Clause 69(1)(b) if those proceedings were brought within two years of grant, unless, of course, the proprietor of the patent knew that he was not entitled to it. It was not intended that this should be the case where the rightful owner had commenced proceedings before the comptroller under Clause 34(1), in compliance with Clause 34(5), or before the court under Clause 34(9). The Amendment makes the position clear by providing that once a reference to the comptroller has been made or proceedings for a declaration before the court have been commenced, in accordance with the two-year time limit specified in Clause 34, the rightful owner may put validity in issue under Clause 71 in any proceedings even though those proceedings have been commenced later than two years from the grant of the patent. I beg to move.
Lord AIREDALE: My Lords, I think there is a small drafting point to be raised. I should have thought that the word "or" should appear at the end of paragraph (a), in the same way as it occurs at the ends of paragraphs (b) and (c).
Lord ORAM: My Lords, I am grateful to the noble Lord for pointing that out.

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At first blush, I think he has made a point and, if so, it will certainly be taken note of and corrected in another place.
On Question, Amendment agreed to.
Clause 75 [Effect of filing an application for a European Patent (UK)]:
Lord ORAM Lord ORAM moved Amendment No. 36:
Page 66, line 41, leave out ("29 and") and insert ("to").
The noble Lord said: My Lords, this Amendment is consequential upon the addition of what is now Clause 28. This was added during Committee. I beg to move.
On Question, Amendment agreed to.
Lord ORAM Lord ORAM moved Amendment No. 37:
Page 67, line 10, at end insert—
("(aa) where a period of time relevant to priority is extended under that convention, the period of twelve months specified in section 5(2) above shall be treated as extended correspondingly;").
The noble Lord said: My Lords, Article 120 of the European Patent Convention allows time limits to be extended and where, by virtue of that Article the 12-month priority period of Article 87 of the European Patent Convention is extended under the Convention in relation to an application or patent, it is right that on any subsequent consideration of priority questions in the United Kingdom on that application or patent, it should be treated as having been extended under the Bill. I beg to move.
On Question, Amendment agreed to.
4.31 p.m.
Lord ORAM Lord ORAM moved Amendment No. 38:
Page 67, line 30, after ("30(1)(b)") insert ("above").
The noble Lord said: My Lords, I beg to move this drafting Amendment which inserts a missing word—namely, the word "above"—making it clear that the section referred to is in the section of that number in the Bill.
On Question, Amendment agreed to.
Lord ORAM Lord ORAM moved Amendment No. 39:
Page 68, line 4, leave out ('53") and insert ("52(4A)").
The noble Lord said: My Lords, this Amendment is consequential upon Amendments Nos. 23 and 26, which we have dealt with. I beg to move.
Lord BELSTEAD: My Lords, I wonder whether the reference, in line 43 on page 67, to Section 53 should be a reference to Section 52. I am not sure, and I have not had a great deal of time to look at the Government's Amendments. But I just put that to the Government, and they may care to look at it after these proceedings.
Lord ORAM: My Lords, we will certainly do that.
On Question, Amendment agreed to.
Clause 77 [Authentic text of European Patents and patent applications]:
Lord ORAM Lord ORAM moved Amendment No. 40:
Page 69, line 40, leave out ("subsection (8)") and insert ("subsections (8) and (9)").
The noble Lord said: My Lords, this Amendment is consequential on Amendment No. 37 made at Report stage, which added a new subsection to what is now Clause 25 dealing with Crown use rights when a lapsed patent is restored. I beg to move.
On Question, Amendment agreed to.
Clause 79 [Jurisdiction to determine questions as to right w a patent]:
4.33 p.m.
Lord ORAM Lord ORAM moved Amendment No. 41:
Page 71, line 38, leave out from ('applicant") to end of line 40 and insert ("does not have his residence or principal place of business in any of the relevant contracting states").
The noble Lord said: My Lords, as at present drafted, Clause 79(4)(b) requires the court or the comptroller to be satisfied, before assuming jurisdiction, that the applicant resides or has his principal place of business elsewhere than in a relevant contracting State—an expression which

597
is defined in Clause 79(9). The Amendment more correctly requires that the court or the comptroller be satisfied that the applicant does not have a residence or principal place of business in any such State. As so amended, the paragraph will more accurately reflect the intention behind the relevant provision of the Protocol on Jurisdiction, which forms an integral part of the European Patent Convention. My Lords, I beg to move.
On Question, Amendment agreed to.
Clause 81 [Patent agents and other representatives]:
Lord ORAM Lord ORAM moved Amendments Nos. 42 and 43:
Page 74, line 1, leave out ("or member").
Page 74,line 2, leave out ("or member").
The noble Lord said: My Lords, I should like to move Amendments Nos. 42 and 43 together, and to speak also to Amendments Nos. 52, 53, 54 and 60. Amendments Nos. 42 and 43 to Clause 81, and Amendments Nos. 53 arid 54 to Clause 106, in deleting the reference to a "member" of a body corporate, prevent the clauses applying to the shareholders of the body. It was never, of course, intended that a body corporate could not describe itself as a patent agent unless all the shareholders were registered as patent agents. On the other hand, Clauses 81 and 106 should apply to members of a public body corporate whose affairs are managed by those members. To achieve this, the definition of "director", which includes "members" of a public body corporate in Clause 105(2), and which was applicable only to Clause 105(1), will, I hope, be deleted by Amendment No. 52 and placed in Clause 122, where it will apply generally, by Amendment No. 60. I beg to move.
Lord BELSTEAD: My Lords, as this Amendment will reword it, Clause 81(3) prevents any body corporate from practising before the European Patent Office, unless the name of every director appears on the European list. I think this will mean that a company whose directors are European patent agents, but whose share capital is owned by citizens of a country other than the United Kingdom and who are not on the European list, could practice before the European Patent Office. I am making no criticism at all about any
598
company whose share capital is owned by people from another country, but I am not aware that the European Patent Office has as yet made up its mind on this point. The EPO is still only at a formative stage and will doubtless, in time, say whether it will allow the directors of such companies to act in Europe.
I should have thought that the only way satisfactorily to draft subsection (3) of Clause 81 at this stage is to say that a body corporate may not hold itself out to act before the European Patent Office unless it is so entitled by the European Patent Office. But that seems rather ridiculous, and I have not put down an Amendment to that effect. I suggest that the Government Amendment which has been moved by the noble Lord, Lord Oram, should now he agreed to; but I should give a warning from this side of the House that this is a point which will perhaps be returned to in another place.
Lord ORAM: My Lords, I am obliged to the noble Lord, Lord Belstead. It is a completely new point to me, as he will appreciate. I think that his suggestion is quite acceptable. If your Lordships will accept Amendments Nos. 42 and 43 together, we can give consideration to the point that the noble Lord has made.
On Question, Amendments agreed to.
Clause 85 [Effect of filing international application for a patent]:
4.38 p.m.
Lord ORAM Lord ORAM moved Amendment No. 44:
Page 77, line 16, after ("amendment") insert ("are").
The noble Lord said: My Lords, this is a drafting Amendment which inserts a word inadvertently omitted from Clause 85(4)(b). I beg to move.
On Question, Amendment agreed to.
Clause 89 [Enforcement of orders for costs]:
Lord ORAM Lord ORAM moved Amendment No. 45:
Page 80, line 40, at end insert—
("(c) in Northern Ireland the order may be enforced as if it were a money judgment".).
The noble Lord said: My Lords, just as Clause 89(a) makes provision for enforcement in England and Wales of orders for the payment of costs made by the European Patent Office in proceedings before it, and Clause 89(b) for their enforcement in Scotland, so will the new paragraph (c), which this Amendment adds to the clause, provide for their enforcement in Northern Ireland. My Lords, I beg to move.
On Question, Amendment agreed to.
Clause 93 [Appeals from the comptroller]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 46:
Page 82, line 6, leave out paragraph (b).
The noble and learned Lord said: My Lords, your Lordships will recall that at Report stage I accepted in principle an Amendment moved by the noble Lord, Lord Lyell. I am happy to say that I now also accept in the letter, and should have done so on an earlier occasion as well. I beg to move.
Lord LYELL: My Lords, after the noble and learned Lord's charming reference to the Amendment which I moved at an earlier stage, may I say that we are very grateful that he has been able to comply totally with our request. Therefore we support this Amendment.
On Question, Amendment agreed to.
4.40 p.m.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendments Nos. 46A and 46B:
Page 82, line 12, leave out paragraph (e)
Page 82, line 37, leave out ("(f)") and insert ("(e)").
The noble Lord said: My Lords, I beg to move Amendments Nos. 46A and 46B. Both Amendments are consequential and arise out of the deletion by your Lordships' House of Clause 20 from the Bill at Report Stage. Subject to any reservation which the Government wish to make about that deletion, I beg to move.
On Question, Amendments agreed to.
Clause 99 [Extension of privilege for communications with solicitors relating to patent proceedings]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendments Nos. 47, 48 and 49:
Page 84, line 15, leave out subsection (2).
Page 84, line 31, at end insert—
("(3) This section shall not extend to Scotland.").
After Clause 100, insert the following new clause:—
Extension of privilege in Scotland for communications relating to patent proceedings.
It is hereby declared that in Scotland the rules of law which confer privilege from disclosure in legal proceedings in respect of communications, reports or other documents (by whomsoever made) made for the purpose of any pending or contemplated proceedings in a court in the United Kingdom extends to communications, reports or other documents made for the purpose of such proceedings

(a) before the Comptroller under this Act, the 1949 Act or any of the relevant conventions, or

(b) before the European Court of the European Patent Office under any of those conventions.

The noble and learned Lord said: My Lords, it may be convenient to discuss Amendments Nos. 47, 48 and 49 together. As at present drafted, Clause 99(1) extends the privilege from disclosure in legal proceedings of communications made with solicitors, and subsection (2) of the clause states how the provision is to apply in Scotland. In Scotland, however, the relevant rules of law on such privilege are not confined to solicitors but apply also to communications made with other professional people. Accordingly, it is thought preferable to remove subsection (2) from the clause, to make Clause 99 cease to apply to Scotland and to make separate provision for Scotland in the new clause after Clause 100, which is set out in the third of the Amendments that I have mentioned, namely, Amendment No. 49. I beg to move.
On Question, Amendments agreed to.
Clause 101 [Costs and expenses]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 50:
Page 86, line 9, after ("7") insert ("11").
The noble and learned Lord said: My Lords, this Amendment is entirely consequential upon the introduction during

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the Report stage of the new Clause 11. Clearly, security for costs may be necessary under Clause 11, just as it may be under Clauses 7 and 34. I beg to move.
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 51:
Page 86, line 18, at end insert—
("(5) In Northern Ireland any order under this section for the payment of costs may be enforced as if it were a money judgment.").
The noble and learned Lord said: My Lords, this Amendment makes provision for the enforcement in Northern Ireland of awards of costs made by the comptroller in proceedings before him. It does so by adding to Clause 101 a new subsection (5) which makes provision for Northern Ireland corresponding to that made in respect of England and Wales and Scotland respectively in subsections (2) and (3) of the clause. I beg to move.
On Question, Amendment agreed to.
Clause 105 [Offences by corporations]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendments Nos. 52, 53 and 54:
Page 87, line 37, leave out subsection (2)
Clause 106, page 88, line 21, leave out ("or member").
Clause 106, page 88, line 22, leave out ("or member").
The noble and learned Lord said: My Lords, these Amendments were spoken to by my noble friend Lord Oram when he dealt with Amendment No. 42. Formally I beg to move that these Amendments be agreed to en bloc.
On Question, Amendments agreed to.
Clause 107 [Power of comptroller to refuse to deal with certain agents]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 55:
Page 89, line 13, after ("above") insert ("or section 88 of the 1949 Act (which is replaced by section 106)").
The noble and learned Lord said: My Lords, Clause 107(1)(b) provides for rules to be made authorising the comptroller to refuse to recognise as agent any person who has been convicted of an offence under Clause 106. It is clearly right that he should also be authorised to refuse to recognise as agent a person who, before
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the appointed day, has been convicted of an offence under the equivalent provision of the present Patents Act, namely, Section 88. The Amendment fills this gap in the Bill. I beg to move.
On Question, Amendment agreed to.
Clause 110 [Information about patent applications and patents, and inspection of documents]:
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 55A:
Page 90, leave out lines 35 to 37.
The noble Lord said: My Lords, I have already spoken to this Amendment. It is consequential upon the deletion from the Bill of Clause 20. Subject to the reservation which the noble Lord, Lord Oram, has already made regarding this matter, I beg to move.
On Question, Amendment agreed to.
Clause 115 [Rules]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 56:
Page 92, line 27, at end insert—
("(ee) requiring the Comptroller to hold proceedings in Scotland in such circumstances as may he specified in the order where there is more than one party to proceedings under sections 7, 34, 37(1) or (2), 38(6), 68 or 69 above;").
The noble and learned Lord said: My Lords, during the Committee stage the noble Earl, Lord Selkirk, proposed an Amendment which would have compelled the comptroller in certain cases to take hearings in Scotland. My noble and learned friend Lord McCluskey indicated that the Government were giving consideration to the question of hearings in Scotland. This matter has been much discussed and a conclusion has been reached, that the wise course is to provide a power to make rules defining the circumstances in which the comptroller may or should hold proceedings in Scotland. That is what the Amendment does. Your Lordships will note that this power takes proper care of the situation which was worrying the noble Earl, Lord Selkirk, and other people, by making it clear that rules may be made in respect of proceedings involving more than one party. There is a rule dealing with these matters in the existing Patents Rules. I can give an undertaking that when the new

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Patents Rules are formulated they will contain a rule which I hope will give full satisfaction to all concerned. I beg to move.
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 57:
Page 92, line 30, leave out from second ("the") to ("this") in line 31 and insert ("alteration of any period of time specified in").
The noble and learned Lord said: My Lords, this is a minor drafting change to Clause 115(2)(f) which is intended to meet a difficulty which could arise under Clause 5(2). I beg to move.
On Question, Amendment agreed to.
Clause 119 [Existing patents and applications]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 58:
Page 95, line 8, leave out from ("Act") to ("above") in line 10 and insert (""existing patent" means a patent mentioned in subsection (2)(a) and (c) above, "existing application" means an application mentioned in subsection (2)(b)").
The noble and learned Lord said: My Lords, this is a drafting Amendment which is intended to clarify subsection (7) of Clause 119 and to reflect the drafting of the Schedules in respect of existing patents and applications. I beg to move.
On Question, Amendment agreed to.
Clause 122 [Interpretation]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 59:
Page 96, line 34, at end insert ("above").
The noble and learned Lord said: My Lords, this is a minor drafting Amendment. I beg to move.
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 60:
Page 97, line 20, at end insert—
"director", in relation to a body corporate established by or under any enactment for the purpose of carrying on under public ownership any industry or part of an industry or undertaking, being a body
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corporate whose affairs are managed by its members, means a member of that body corporate;").
The noble and learned Lord said: My Lords, this Amendment was spoken to by my noble friend Lord Oram when he dealt with Amendment No. 42. Formally I beg to move.
On Question, Amendment agreed to.
Clause 124 [Short title, extent, commencement and repeals]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 61:
Page 101, line 8, at end insert—
("( )The consequential amendments in Schedule (Consequential Amendments) shall have effect.").
The noble and learned Lord said: My Lords, in speaking to this Amendment may I also, with the leave of the House, speak to Amendment No. 74. Amendment No. 61 is a paving Amendment for Amendment No. 74, which adds a new Schedule dealing with consequential Amendments to other enactments. These consequential Amendments are technical in character, and I do not think I need take up the time of the House by going through them in detail. I beg to move.
On Question, Amendment agreed to.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 62:
Page 101, line 10, after ("Act") insert ("(which include certain enactments which were spent before the passing of this Act)").
The noble and learned Lord said: My Lords, in dealing with this Amendment it may be convenient to consider also Amendment No. 78. Amendment No. 78 is the principal Amendment. Again it lists a number of provisions which either are spent or will be superseded by the Bill. Amendment No. 62 makes it clear that some of the provisions repealed are already spent. I hope that we have caught most of the spent provisions in Schedule 5. I beg to move.
On Question, Amendment agreed to.
4.50 p.m.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 63:
Page 101, line 11, at end insert (",subject to any savings contained in that column".)
The noble and learned Lord said: My Lords, this is a paving Amendment, made necessary by changes in Schedule 5 made by Government Amendment No. 77, which are consequential on changes in Schedule 4 following Government Amendment No. 73. I beg to move.
On Question, Amendment agreed to.
Schedule 1 [Application of 1949 Act]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 64:
Page 102, line 7, after ("13") insert ("(1) to (3)").
The noble and learned Lord said: My Lords, this Amendment arises from changes to Schedule 4 relating to infringement of patents granted under the 1949 Act. As a result of those changes it is no longer appropriate in Schedule 1 to maintain a reference to the "rights of publication" provision of Section 13 (4) of the 1949 Act and this Amendment deletes the reference. I beg to move.
On Question, Amendment agreed to.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 65:
For galley 39—
Page 102, line 33, leave out ("eleven") and insert ("fourteen").
The noble Lord said: My Lords, there was an initial agreement between the noble Earl, Lord Halsbury, and myself that I should move this Amendment and he should reply. This brief Amendment is very important because it concerns the term of a patent. Under the present Patents Act the term of a patent is 16 years, subject to certain applications which can be made in the Court of the Comptroller-General for discretionary leave to extend the period of the term by up to 10 years; but now, under this Bill, all patents are to be extended to 20 years and the discretionary right of the court to extend the patent beyond 20 years no longer exists.
Once it has been decided to extend the patent to 20 years there really is no basic logic why the patents already in existence under the present Act should also be extended to 20 years, except for one matter. There may be licensees who would be seriously affected if the patents were all extended to 20 years. There may be
606
persons who have no interest in the patent or who may be operating in the same field, who have made certain inventions or who feel they would be in a position to exploit certain of their products if there were no patents and they thought there would be a period when the patent would have expired.
Now it becomes a question of opinion. Should one now say, in so far as the patents that already exist, that in the last resort they should not have the advantage of five years; they should allow the copyists and other people to come into the field, because they will be fairly free, for the period of five years? This Amendment says, "That is too long; the patentee, the initial innovator who has been keeping on his patent for such a long time and paying heavy fees, probably from overseas and therefore bringing money into the country, should be given only two years where there is to be this relaxation of his monopoly rights, and not five years."
The clause to which this is now an Amendment was brought in by the Government at the Report stage. It includes relevant and, if I may say so, very effective provisions dealing with the rights of licensees and safeguards to people who are working in the other field. Now comes the question: Should this patent be free to the licensee, subject to certain safeguards already in the Bill, for five years or should it be limited to two years? The Standing Advisory Committee have said that it is a five-year period; in other words, they want the figure "11" to he in the Bill, as it is at present. I have suggested that they leave out "eleven" and substitute "fourteen", which will give the two years, because the life of the patent is 16 years.
The position varies from industry to industry as to the value placed on patents. In some industries all patents expire after seven years, but particularly in the chemical industry and the pharmaceutical industry it is difficult to get the patents worked and operated on a commercial scale. In the pharmaceutical industry not only have they to do a lot of work in connection with research and development but they also have to conform with very stringent tests rightly imposed upon them by the Government and other bodies for reasons of safety. Therefore, on balance, it seemed to us on these Benches that it

607
would be right to limit the period over which there was freedom from monopoly to two years (subject to the usual safeguards) rather than five years.
With the leave of the House I should like to speak also to Amendment No. 66. In the Bill as at present drafted there is a clause which, as indicated at the Report stage, is a safeguard to people who have been operating in the same field as the subject of the patent. It says in effect that in this period of five years to which I have referred, and which we now want to reduce to two years, the patent should be subject to licences of right. That is to say, anybody who has been standing by for years, waiting for this patent to lapse, suddenly comes along and says, "I want to get into this field" and therefore he can go to the Patent Office and say, "I must have a licence". The patentee could not prevent him from having a licence and the licence would be granted by the Comptroller-General after a hearing, subject to certain terms.
In my submission there is already a proper safeguard in this clause as at present in the Bill to look after the interests of licensees. Therefore, this Amendment seeks to delete the subsection which says that anybody may come along to have a licence of right. To put the matter quite graphically, this Amendment is in favour of the patentee who has a good invention, so good that he has kept it going almost to the end of its term, and therefore provided there are safeguards for the licensees and persons operating in the same technological field, two years' safeguard is sufficient and not five, as in the Bill. But even in that last period the copyists and the people who want to "muscle in" in that field, perfectly properly no doubt, should not be allowed to do so at the expense, in effect, of the innovator. In other words, this Amendment encourages the innovators and not the copyists. I beg to move Amendment No. 65.
4.59 p.m.
The LORD CHANCELLOR: My Lords, the subject of the term of patents granted under the 1949 Act was debated at some length on Report in connection with Amendment No. 158, also moved by the noble Earl, Lord Halsbury, and the
608
noble Lord, Lord Lloyd of Kilgerran,and I would not wish to cover all that ground again today. I would however say this. Between the two extreme positions of doing nothing about the term of existing patents and of increasing them all unconditionally to 20 years there is almost an infinity of intermediate points. Assuming, as I think it is fair to do, that no one is seriously urging adoption of either of the extreme positions, the problem becomes one of choosing an intermediate solution that gives as much all round justice as can be obtained when one is changing from one system to another.
As I ventured to say during the debate on Report, the Government's proposals in the Bill are based on consultation with industrial and professional bodies concerned with patents, and represent a compromise between the interests of patentees and non-patentees. Of course, as of most compromises, it may be said that this one would be improved if it were shifted a bit in one direction or another, and I am sure that the purpose of the present Amendments is to obtain an even better compromise.
I would venture to repeat what I said on the earlier occasion during debate on Report. If the Government's proposals are acceptable, as they are, to those most affected by them, then, unless there are compelling reasons to the contrary, I think it would be most unwise to change them. I cannot put the matter more simply than that, and I hope that, in the light of that appeal to the desirability of supporting this consensus, noble Lords will feel able to withdraw Amendment No. 65.
Lord NORTHFIELD: My Lords, may I interrupt my noble and learned friend. When he says that the Government's proposals are acceptable, could he tell us more specifically which organisations have said that they accept them, because the information that many of us have had is that considerable lobbies of interested parties are in fact wanting a much better compromise than the Government are offering.
The LORD CHANCELLOR: My Lords, I cannot specify the organisations at this moment of time, but before we have ceased discussing this Amendment I shall be able to do so. My understanding is that they are the professional

609
bodies concerned and a number of industrial organisations as well, but it may well be that before we finish with this Amendment I shall get from a certain place further and better particulars of the matters my noble friend has asked for.
Paragraph 4(2)(c) of Schedule 1, which Amendment No. 66 would delete from the Bill, is an integral part of the provisions relating to the term of existing patents, since its effect is that a patentee cannot during the increased term of his patent stop anyone else from using the invention of the patent provided that he is willing to pay for doing so. This is the meaning of a licence of right. The royalty rate in default of agreement may be determined by the Comptroller under Section 35 of the 1949 Act. So I fear that I must also resist that Amendment.
Lord BELSTEAD: My Lords, may I say a word about this, if only because I rather discourteously had to leave your Lordships' House at Report stage before the noble and learned Lord moved the Government Amendment which writes in paragraphs 3 and 4 into Schedule 1. On that occasion, the noble and learned Lord very fairly admitted that the only controversial aspect of the Government Amendment to which he was speaking at that time was that it restricted the increased term of 20 years to patents having more than five years to run; in other words, the Government were drawing the line between old and new patents at live years.
This Amendment, as Lord Lloyd has explained, draws the line at two years, and the first thing I want to say is that so far as I can see that is really all it does. I am leaving aside for the moment the second Amendment, No. 66, about which I think the noble Earl, Lord Halsbury, will probably say a word, among other things, when he winds up. Taking it in the main, this Amendment really draws the line at two years and it does nothing else. Otherwise the Government's wording is left exactly as it is, with the safeguards for Crown use and for people wishing to work a patent during the increased term of a patent untouched, and leaving in the text of paragraph 4(4), which enables anyone who suffers loss or liability because of the increased term of the patent to apply to the court for restitution. All that stays in.
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There are two points I would make without going into any of the arguments, for or against the claims of patentees and the problems of licensees, because Lord Lloyd has referred to those. First, I would apologise to the Lord Chancellor for querying at Report stage the noble and learned Lord's statement that the Government Amendment then was in line with the views of the Standing Advisory Committee on the subject. The noble and learned Lord was absolutely right and I was entirely wrong, because I was in error in thinking that the Government Amendment only allowed extension of an existing patent on the grounds provided by Section 23. Of course that was not the case; I am afraid I misread the Government Amendment. The right to extension in the Government Amendment at that time depended on the patent having five years or more to run.
Having said that, with regard to Lord Northfield's intervention just now, it may be that the Standing Advisory Committee's view on this subject is a majority view and not an absolutely total view. I do not know, and think perhaps your Lordships do not know, although we are aware that there are different views on what at the end of the day has to be an arbitrary decision. But even though the Standing Advisory Committee, either by majority or in total, supports the five-year term, I am bound to say that my noble friend and I on this Bench believe that the noble Lord, Lord Lloyd, has made out a strong case in moving that the two-year term be written into the Bill. If this Amendment errs, it is going to err on the side of the inventor, and really that is no bad thing.
The other point I wish to make is this. I think there is some Parliamentary advantage in accepting this Amendment. The Government Amendment was brought forward at fairly short notice, and I do not cavil at that because I know under what pressure Ministers and members of the Civil Service have been. But it was brought forward at less than a day's notice so far as we were concerned. There was not much time to consider the Government Amendment on its merits. But there will be plenty of time for the Government to consider the merits of this Amendment between now and the Committee stage in the House of Commons.

611
Indeed, agreement with this Amendment in this House will require the Government to consider the matter all over again, and I do not think that that would be a bad thing. Then if the Government genuinely believe that on grounds of equity, and in response to the Standing Advisory Committee, the Bill should once again revert to the five-year term, I suggest that the Government have only to use their majority, which they have combined with the Liberal Party, in the House of Commons in order to write the five-year term back into the Bill. If they did that, I feel sure that when the Bill comes back to this House, the noble Lord, Lord Lloyd, the noble Earl, Lord Halsbury, and my noble friends and I would then certainly accept the final verdict of the Government.
The Earl of HALSBURY: My Lords, I have, naturally, listened very attentively to all that has been said, particularly by the noble and learned Lord. I did not press our own Amendments on the last occasion, because I thought it wrong to do so when we had Government Amendments, as it were straight from the draftsman's pen. Therefore, I went along with them at Report stage. But having considered what was said then, I realise that there is a certain common ground between myself and the noble and learned Lord, in the sense that there are no magic numbers—five is not a magic number; two is not a magic number—and I am also swayed by the noble Lord, Lord Belstead, into remembering that I am not having the last word on this subject; the Bill now goes to another place. I concede that we need a dead zone for readjustment. You could argue that we should not by Statute intermeddle with the equity of established bargains between citizens, but that view has not been taken; the Government have yielded on that point and those concerned have yielded on that point. It is only a question of how long, with no magic numbers. From my own experience, I should have thought that two years was quite sufficient for the purpose of adjustment.
On the question of where the balance of opinion lies, I am a bit sceptical about the views collected by the Government from their advisers, from professional bodies, from the Standing Advisory Committee
612
and so on. There are three groups of self-interest that have to be balanced against one another. One is the self-interest of the operator-inventor, a big chemical company, say, who are manufacturing the subject matter of the products of their own laboratories, and their interest is clearly to extend the patent for as long as possible. Then there is the licensee for royalties receivable on possibly foreign manufacture, and he may tend towards indifference, because the foreign patent may already exist for 20 years under foreign patent law. So he is anything from an interested to an indifferent party. Then there is the licensee in this country under foreign inventions for royalties payable to a foreign firm or possibly an English one. He would naturally like to see the extension minimal because it would terminate his liability to pay earlier. If I cast my mind along the list of companies with which I have been associated at one time or another, it seems that they are all quite different—their self-interests are different.
I do not think that I can regard as valid a kind of pseudo-plebiscite simulated by the Government's advisers when I know that my own experience is in quite sharp contrast with that. There is variation from industry to industry. For example, two firms which I have been advising in the heavy engineering industry have to pay heavy royalties abroad. That is due to lack of investment by the British steel industry in steelmaking plant. Most of our firms have not built a blast-furnace for years and have to go to America or Japan for the know-how and licences with which to do it. They are heavy royalty payers.
The operator-inventors will, of course, want to extend their term. I was once associated with a firm in the chemical industry whose receivable royalties were so great that they paid for the whole of the research laboratory expenditure in this country so that the advantages of operating patents were, as it were, a free issue.
My Lords, I feel inclined to stick to my guns and convictions on this matter. I have received some support from the noble Lord, Lord Belstead, and I am joining battle with the noble Lord, Lord Lloyd of Kilgerran—we are the usual pair of twins in this debate. If he is agreeable to going ahead, I shall express

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myself content that the Amendment should be put.
I believe that, as it stands, Amendment No. 66 and paragraph (c) is a rather characteristic piece of legislative legerdemain in which the Government gives away with one hand what it takes back with another. At one time we all felt, without wishing to raise old quarrels, that the Government had made a sensible gesture in consenting not to nationalise the shiprepairing industry. It was only when we read the small print that it was found that a very large proportion of the shiprepairing industry would be nationalised notwithstanding. I do not see the point in giving the operator-inventor a four-year extension of the life of his patent and then saying, "But everybody else can work it too". Where is the sense in that? I beg to support the Amendment standing in my name and that of my noble friend.
The LORD CHANCELLOR: My Lords, with the leave of the House, perhaps I may briefly answer the debate. It might seem almost a heresy to challenge the wisdom of the heavenly twins, if I may so describe them, but challenge them I shall. I do so because, in spite of the intervention of my noble friend Lord Northfield, the Government's proposals amount to a compromise which emanated from the Standing Advisory Committee bodies. Perhaps I may remind your Lordships of the composition of that Committee, which is quite formidable. It comprises the Confederation of British Industry, the Association of British Chambers of Commerce, the International Chambers of Commerce, the Bar Council, the Law Society, the Chartered Institute of Patent Agents, the Institute of Patentees and Inventors and, last but by no means least, the Trades Union Congress. Therefore, it was quite a formidable body that
argued over this for, I think, some considerable time.
To call it a pseudo-plebiscite, which is an attractive turn of phrase, is a little unkind to the deliberations of that sombre and responsible body of men. The compromise is not merely an idea that has sprung into the head of the Government—if I were to rest the matter on that foundation it would not necessarily appeal to all parts of the House. However, it has a good parentage and, accordingly, I hope that it will be accepted.
I am advised that perhaps the noble Lord, Lord Lloyd of Kilgerran, has misunderstood Amendment No. 66. It does not allow a third party to exploit the invention until after the 16-year period is up. It is only then that he "muscles in" and even then he has to pay a royalty, which is fixed by the comptroller under the licence of right. I do not know whether those observations may induce the noble Lord, Lord Lloyd of Kilgerran, not to press Amendment No. 66, but I am afraid that I must resist Amendment No. 65.
The Earl of HALSBURY: My Lords, if the noble and learned Lord had simply said that one adviser of merit had been unanimous on this point, he might have carried me with him but the list is so long that its lack of unanimity is almost guaranteed. Perhaps I may quote from Pooh-Bah in saying that it seems to do no more than:
"…give artistic verisimilitude to an otherwise bald and unconvincing narrative".
My Lords, I shall stick to my guns.
5.16 p.m.
On Question, Whether the said Amendment (No. 65) shall be agreed to?
Their Lordships divided: Contents, 89; Not-Contents, 51.

CONTENTS

Aldenham, L.

Belstead, L.

Darwen, L.

Alexander of Tunis, E.

Berkeley, B.

Daventry, V.

Allan of Kilmahew, L.

Boothby, L.

Davidson, V.

Alport, L.

Bullock, L.

de Clifford, L.

Amherst, E.

Byers, L.

De Freyne, L.

Amory, V.

Carrington, L.

Drumalbyn, L.

Ampthill,L.

Cathcart, E.

Ebbisham, L.

Auckland, L.

Chelwood, L.

Ellenborough, L.

Avon, L.

Clifford of Chudleigh, L.

Elles, B.

Banks, E.

Cork and Orrery, E.

Emmet of Amberley, B.

Barnby, L.

Cullen of Ashbourne, L.

Energlyn, L.

Falkland, V.

Macleod of Borve, B.

St. Aldwyn, E.

Ferrers, E.

Mancroft, L.

St. Davids, V.

Gainford, L.

Mansfield, E.

Sandys, L.

Glenkinglas, L.

Marley, L.

Seear, B.

Gray, L.

Merrivale, L.

Spens, L.

Greenway, L.

Morris, L.

Stamp, L.

Gridley, L.

Mottistone, L.

Strathcarron, L.

Hailsham of Saint Marylebone,L.

Newall, L.

Strathcona and Mount Royal, L.

Northchurch, B.

Strathspey, L.

Halsbury, E. [Teller.]

Nugent of Guildford, L.

Trefgarne, L.

Harmar-Nicholls, L.

Nunburnholme, L.

Tweedsmuir, L.

Hawke, L.

O'Hagan, L.

Vickers, B.

Hemphill, L.

Orr-Ewing, L.

Vivian, L.

Killearn, L.

Platt, L.

Wade, L.

Kimberley, E.

Porritt, L.

Ward of North Tyneside, B.

Lindsey and Abingdon, E.

Rankeillour, L.

Ward of Witley, V.

Lloyd of Kilgerran, L. [Teller.]

Rochester, L.

Wigoder, L.

Long, V.

Ruthven of Freeland, Ly.

Windlesham, L.

Lyell, L.

Sackville, L.

Young, B.

NOT-CONTENTS

Arwyn, L.

Elwyn-Jones, L. (L. Chancellor.)

Phillips, B.

Aylestone, L.

Gaitskell, B.

Ritchie-Calder, L.

Balogh, L.

Glenamara, L.

Shepherd, L.

Blyton, L.

Gordon-Walker, L.

Shinwell, L.

Boston of Faversham, L.

Greenwood of Rossendale, L.

Stedman, B.

Brimelow, L.

Hale, L.

Stewart of Alvechurch, B.

Bruce of Donington, L.

Henderson, L.

Stone, L.

Burntwood, L.

Kilbracken, L.

Strabolgi, L.

Castle, L.

Leatherland, L.

Taylor of Mansfield, L.

Champion, L.

Lee of Newton, L.

Wallace of Coslany, L. [Teller.]

Chorley, L.

Listowel, E.

Walston, L.

Collison, L.

Llewelyn-Davies of Hastoe, B.

Wells-Pestell, L. [Teller.]

Cooper of Stockton Heath, L.

Lovell-Davis, L.

White, B.

Crowther-Hunt, L.

Milford, L.

Willis, L.

Davies of Leek, L.

Oram, L.

Wise, L.

Davies of Penrhys, L.

Pannell, L.

Wootton, of Abinger, B.

Donaldson of Kingsbridge, L.

Parry, L.

Wynne-Jones, L.

Resolved in the affirmative, and Amendment agreed to accordingly.
5.24 p.m.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 66:
Page 103, line 35, leave out head (c).
On Question, Whether the said Amendment (No. 66) shall be agreed to?
Their Lordships divided: Contents, 80; Not-Contents, 45.

CONTENTS

Aldenham, L.

Emmet of Amberley, B.

O'Hagan, L.

Alexander of Tunis, E.

Falkland, V.

Orr-Ewing, L.

Allan of Kilmahew, L.

Ferrers, E.

Platt, L.

Alport, L.

Foot, L.

Porritt, L.

Amherst, E.

Gainford, L.

Rankeillour, L.

Amory, V.

Glenkinglas, L.

Rochester, L.

Ampthill, L.

Gray, L.

Ruthven of Freeland, Ly.

Auckland, L.

Gridley, L.

Sackville, L.

Avon, E.

Halsbury, E. [Teller.]

St. Aldwyn, E.

Banks, L.

Harmar-Nicholls, L.

St. Davids, V.

Barnby, L.

Hawke, L.

Sandys, L.

Belstead, L.

Killearn, L.

Seear, B.

Berkeley, B.

Lindsey and Abingdon, E.

Spens, L.

Boothby, L.

Lloyd of Kilgerran, L. [Teller.]

Stamp, L.

Carrington, L.

Long, V.

Strathcarron, L.

Cathcart, E.

Lyell, L.

Strathcona and Mount Royal, L.

Chelwood, L.

Macloed of Borve, B.

Strathspey, L.

Clifford of Chudleigh, L.

Mancroft, L.

Trefgarne, L.

Cork and Orrery, E.

Mansfield, E.

Tweedsmuir, L.

Cullen of Ashbourne, L.

Marley, L.

Vickers, B.

Daventry, V.

Merrivale, L.

Vivian, L.

Davidson, V.

Morris, L.

Ward of North Tyneside, B.

de Clifford, L.

Mottistone, L.

Ward of Witley, V.

Drumalbyn, L.

Newall, L.

Wigoder, L.

Ebbisham, L.

Northchurch, B.

Windlesham, L.

Ellenborough, L.

Nugent of Guildford, L.

Young, B.

Elles, B.

Nunburnholme, L.

NOT-CONTENTS

Arwyn, L.

Gaitskell, B.

Ritchie-Calder, L.

Aylestone, L.

Glenamara, L.

Shepherd, L.

Balogh, L.

Gordon-Walker, L.

Shinwell, L.

Blyton, L.

Greenwood of Rossendale, L.

Stedman, B.

Boston of Faversham, L.

Hale, L.

Stewart of Alvechurch, B.

Brimelow, L.

Henderson, L.

Stone, L.

Bruce of Donington, L.

Kilbracken, L.

Strabolgi, L.

Castle, L.

Leatherland, L.

Taylor of Mansfield, L.

Chorley, L.

Lee of Newton, L.

Wallace of Coslany, L. [Teller.]

Collison, L.

Listowel, E.

Walston, L.

Cooper of Stockton Heath, L.

Llewelyn-Davies of Hastoe, B.

Wells-Pestell, L. [Teller.)

Davies of Leek, L.

Lovell-Davis, L.

White, B.

Davies of Penrhys, L.

Oram, L.

Willis, L.

Donaldson of Kingsbridge, L.

Pannell, L.

Wise, L.

Elwyn-Jones, L. (L. Chancellor.)

Parry, L.

Wynne-Jones, L.

On Question, Amendment agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
Schedule 2 [Application of this Act to existing patents and applications]:
5.33 p.m.
Lord LLOYD of KILGERRAN Lord LLOYD of KILGERRAN moved Amendment No. 66A:
Page 104, line 37, leave out ("20, 21").
The noble Lord said: My Lords, I have already spoken to this Amendment. Itisconsequential on the action of the House in deleting Clause 20 and, subject to any reservations that the noble Lord, Lord Oram, may have on behalf of the Government in the matter, I beg to move.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 67:
Page 104, line 37, leave out ("68") and insert ("51").
The noble and learned Lord said: My Lords, this is a drafting Amendment consequential on changes to Schedule 4.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 68:
Page 104, line 46, at end insert—
("(cc) a reference to the grant of a patent under this Act includes a reference to the sealing and grant of an existing patent").
The noble and learned Lord said: My Lords, this Amendment is necessary so that in applying the provisions of the Bill to existing patents, which is the purpose of Schedule 2, a patent sealed and granted under the 1949 Act shall be treated as if it had been granted under the Bill.
Schedule 3 [Repeals of provisions of 1949 Act]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 69:
Page 105, line 21, leave out from ("by") to ("shall") and insert ("Schedule 2 above and Schedule 4 below").
The noble and learned Lord said: My Lords, Schedule 3 relates to repeals of certain provisions of the 1949 Act and paragraph 1(1) of the Schedule as drafted referred to provisions superseded by the operation of Schedule 2. However, Schedule 4 also supersedes some of the provisions of the 1949 Act, and a reference to that Schedule is therefore appropriate in Schedule 3, and that is the effect of the Amendment.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 70:
Page 105, line 23, after ("11(3)") insert ("13(4)").
The noble and learned Lord said: My Lords, this Amendment complements Government Amendment No. 64 to Schedule 1. Both are consequential on Government Amendment No. 73 which redrafts the transitional provisions of Schedule 4 relating to infringement.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 71:
Page 105, line 25, at end insert—
("(3) The repeal of sections 13(4), 46 to 49 and 59 to 67 of the 1949 Act shall not affect the application of those sections in relation to existing patents and applications for patents.").
The noble and learned Lord said: My Lords, Schedule 3 has the effect of repealing the Crown use and infringement

619
provisions of the 1949 Act. However, since those provisions will continue to have force in relation to acts done before the coming into force of the new Act, it is necessary for those purposes to except them from the general effect of the Schedule. This the Amendment does.
5.36 p.m.
Lord LYELL Lord LYELL moved Amendment No. 72:
Page 105, line 33, leave out from ("Court),") to end of line 36 and insert ("subsection".)
The noble Lord said: My Lords, with the permission of the House, I shall speak at the same time to Amendment No. 76. I spoke to two Amendments identical to these on Report and the argument I put forward then was that the grounds of revocation of a patent should not be changed or be capable of being changed in the middle of revocation proceedings, especially in the case of existing patents, which are of course revocable on the grounds set out in Section 32 of the 1949 Act.
Practioneers, be they the noble Lords, Lord Lloyd of Kilgerran and Lord Cawley, or patent agents or inventors, like the noble Earl, Lord Halsbury, are all concerned to give good advice to inventors or clients. Suppose a patent can be revoked on Section 32 grounds, it can be clearly seen that the patent is invalid. Along comes an inventor and consults an expert adviser who tells him that a patent is indeed invalid and that he, the inventor, can make use of a certain process. This measure will in due course become an Act and, when that happens, that particular patent will become validated and cannot be revoked, with what we regard as two potentially grave consequences.
First, anyone who makes secret prior use of a process can easily find that that process becomes valid, whereas under Section 32 the process is not patentable or the patent is not valid on the grounds of secret prior use. How can that be reconciled with expert advice which is at present given under the provisions of Section 32? The second grave consequence which we believe is liable to arise is the possibility of the removal from the
620
grounds of objection of the lack of fair basis under the 1949 Act, or, as we have it in this Bill, the lack of support in the description.
In my remarks on Report I mentioned the case of secret prior use and I wish to develop those remarks a little further, though I shall do so briefly. The grounds of secret prior use are spelt out in Section 32(1)(l), but in sub-paragraph (l) we we find that secret prior use is not to be taken as grounds for revocation under sub-paragraph (e), which is novelty, and (f), which is obviousness. The law as it stands under the 1949 Act, in subparagraph (l), forbids secret prior use, but the Bill would tolerate and, I believe, even permit it. The Bill also seeks to repeal Section 32 (2), in which we find mention of secret prior use. For this reason, we believe that subsection (2) should stay in the provisions of the 1949 Act as they are to he repealed, or not, by the Bill.
I should like now to turn to the question of lack of fair basis. This ground in the 1949 Act has no counterpart in the European Patent Convention and I wonder whether it was really the intention of the Standing Advisory Committee that everything in this particular category should be omitted from the Bill. I and my noble colleagues hardly think so. An extra wide claim as part of an invention which might aggrieve a third party intending to use a certain process could be seen to offer the possibility that the inventor would find himself obstructed. Could this inventor be caught by the grounds of insufficiency in the Bill? That is one point that worries us. Secondly, it seems that the new Bill will enable interested parties to see patent files in the Patent Office. We believe that this will help in two ways: first, the applicant's comments and descriptions will be able to be closely examined and, secondly, a third party will be able to apply for an order of prohibition or certiorari. This would occur if a claim seemed likely to be granted which was not supported by the description. Under the 1949 Act such files were not open to the public, and I venture to suggest that the patent examiners were more lenient than they will be under the new Bill. Thus, I feel that the grounds of lack of fair basis can and, indeed, ought to be retained in the Bill as an objection to existing patents.
At Report stage, I was delighted and even encouraged by the comment of the noble and learned Lord that there was, as he put it, some theoretical force in my Amendment. I am afraid that I could not entirely agree with the noble and learned Lord when he said on Report that the grounds for revocation that were to be repealed were of limited importance. It appeared to me that he was not entirely convinced that the injustices that I brought forward in the Amendment were to outweigh the need for harmonisation. However, the practitioners, be they qualified or not, are convinced that the grounds of fair basis and secret prior use should remain in the 1949 Act as it applies to existing patents.
I hope that the noble and learned Lord or the noble Lord, Lord Oram, if he is to speak for the Government—I see a look of dissent on the face of the noble Lord, so I shall continue to address my remarks to the noble and learned Lord, whose comments we await with expectation—will say that the Government intend to examine more closely the provisions of Section 32. We believe that, even at this late stage of the Bill—and it is only late in the life of the Bill in this House—this battlefield will be fought over (I hope in a genteel and civil manner) in another place. At this stage we look forward to hearing what the noble and learned Lord has to say. I beg to move.
The LORD CHANCELLOR: My Lords, as has been pointed out by the noble Lord, Lord Lye11, Schedule 3, paragraph 2(2)(b) abolishes certain of the grounds on which an existing patent may be revoked under Section 32 of the 1949 Act, because those grounds are not available as grounds for the revocation of European patents and Community patents or of patents granted under the new law. The first Amendment would have the effect of re-introducing these grounds (except the ground of Section 32(3)) and the second Amendment is consequential.
We discussed this during the Report stage and I am afraid that I am still unable to accept the Amendment. During the period leading up to this Bill, there was much discussion with the several patent interests represented on the Standing Advisory Committee on Patents concerning the policy which should be adopted as regards existing patents. On the point
622
to which this Amendment relates, the Committee clearly advised that, except for prior claiming, revocation of an existing patent should not be possible on grounds which will have no counterpart in the new law. That advice was reflected in the Green Paper published in 1975. It is true that the Chartered Institute raised objection on this particular point to the proposed policy there set out. However, this time no criticism of this policy was made by the organisations representing industry, although another professional body urged that the Bill grounds of revocation should be applied to existing patents. In view of this balance of views, and particularly having regard to the absence of objection from industry, it was decided to retain the policy of the Green Paper and this is now contained in Schedule 3 to the Bill.
I believe that there are good reasons to maintain the provisions of Schedule 3. It would be unjust to revoke an old patent after entry into force of the new law on a ground which is not available for the revocation of new patents. Apart from that, it is highly desirable to harmonise, so far as possible, the grounds for revocation of European, Community and all British patents and so avoid confusion in the public mind. I do not think that that objective would be served by preserving obsolescent grounds of revocation for 20 years after the Bill comes into operation.
The Amendment seeks to reverse this policy on the general ground that the Bill as it stands would validate old patents that could be invalidated on the existing grounds of Section 32. I do not find this argument attractive because we are dealing with a situation where existing patents have not as yet been held to be invalid; the thought that a patent may on some ground be invalid is far removed from a judgment that holds that this is in fact in law the case. As I said during the Report stage and as has again been pointed out today, the argument may have theoretical force, but in practice the revocation grounds which the Bill abolishes are of very limited importance.
The noble Lord, Lord Lyell, put it to the House that his main disquiet with the Bill concerned the abolition of the ground of secret prior use. Noble Lords on this side of the House and those who are advising the noble Lord, Lord Lye11, appear to

623
think it inequitable that an inventor who has not applied for a patent and is relying on secret use of his invention should suddenly find that he is liable to be attacked by the proprietor of a patent which, under the 1949 Act, the secret user could have invalidated. My Lords, this is a true statement of the position so far as it goes, but I should like to say that this secret user is compensated under the Bill by the fact that he is given a right in Clause 61 to continue the use that he had begun. In view of this, I do not feel that the contention of the noble Lord has a great deal of force.
I should perhaps add that, where the secret prior use was the patentee's own secret use before he applied for a patent, then it is true that he obtained his patent knowing it to be invalid. I do not condone that, but bearing in mind that in such cases, as far as they exist, the evidence necessary for the revocation of the patent is usually known only to the patentee, the invalidity of his patent is, in consequence, more notional than real. Having regard to the history of the provision to which this Amendment relates, I regret that I cannot agree to this Amendment.
Lord LYELL: My Lords, I am even more grateful than I was at Report stage for the very full explanation that we have received from the noble and learned Lord. There is only one point that I should like to raise. I wonder whether the noble and learned Lord really believes, as I think he said, that it is undesirable that a patent that is in existence under the 1949 Act should, because of the repeal of the provisions of Section 32, be unable to be revoked under the provisions of the 1949 Act.
As the noble and learned Lord said so nicely, the advisers have given my noble friend Lord Belstead and myself, and indeed other noble Lords, so much advise in these matters of patents. It is these practitioners, if I may call them such, who have expressed disquiet. It seems that the laws relating to revocation of patents are being changed; indeed when the patent was granted it was seen that revocation was as set out in Section 32. I wondered merely whether the noble and learned Lord was entirely satisfied on this question. It seemed not to be justified.
624
Of course, in matters of law I must take guidance from the noble and learned Lord. I take with respect and humility all his comments. However, I think it would not be right to continue this argument, nor to push it further. We have received a considerable amount of further information today from the noble and learned Lord, and for that reason I beg leave to withdraw the Amendment, without reluctance.
The LORD CHANCELLOR: My Lords, I have little doubt that this matter will be returned to in another place.
Amendment, by leave, withdrawn.
Schedule 4 [Transitional provisions]:
5.52 p.m.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 73:
Page 106, line 11, leave out paragraph 2 and insert—
("Use of patented invention for services of the Crown
2.—(1) Any question whether—

(a) an act done before the appointed day by a government department or a person authorised in writing by a government department amounts to the use of an invention for the services of the Crown; or

(b) any payment falls to be made in respect of any such use (either to the patentee or to an exclusive licensee);

shall, subject to sub-paragraph (3) below, be determined under sections 46 to 49 of that Act and those sections shall apply accordingly.
(2) Sections 52 to 56 above shall apply to an act so done on or after the appointed day in relation to an invention—

(a) for which an existing patent has been granted or an existing application for a patent has been made; or

(b) which was communicated before that day to a government department or any person authorised in writing by a government department by the proprietor of the patent or any person from whom he derives title;

and shall so apply subject to the modifications contained in paragraph 2 of Schedule 2 above and the further modification that paragraph (b) of section 52(4A) above shall not apply in relation to an existing application.
(3) Where an act is commenced before the appointed day and continues to be done on or after that day, then, if it would not amount to the use of an invention for the services of the Crown under the 1949 Act, its continuance on or after that day shall not amount to such use under this Act.
Infringement.
2A.—(1) Any question whether an act done before the appointed day infringes an existing patent or the privileges or rights arising under a complete specification which has been published shall, subject to subparagraph (3) below, be determined in accordance with the law relating to infringement in force immediately before that day and sections 13 (4) and 59 to 67 of the 1949 Act shall apply accordingly.
(2) Sections 57 to 68 above shall apply to an act done on or after the appointed day which infringes an existing patent or the privileges or rights arising under a complete specification which has been published (whether before, on or after the appointed day) as they apply to infringements of a patent under this Act or the rights conferred by an application for such a patent, and shall so apply subject to the modifications contained in paragraph 2 of Schedule 2 above and the further modification that paragraph (b) of section 66(2) above shall not apply in relation to an existing application.
(3) Where an act is commenced before the appointed day and continues to be done on or after that day, then, if it would not, under the law in force immediately before that day, amount to an infringement of an existing patent or the privileges or rights arising under a complete specification, its continuance on or after that day shall not amount to the infringement of a patent under this Act or, as the case may be, the rights conferred by a published application for such a patent.").
The noble and learned Lord said: My Lords, this is a technical Amendment of some complexity. It has two purposes. First, it introduces into the Bill a transitional provision governing the Crown use of patented inventions which are the subject of existing patents and applications. Expressed briefly, this provides that questions relating to the use of inventions for the services of the Crown, and payment for such use, shall be determined under the relevant provisions of the 1949 Act where the use took place before the appointed day, but shall be determined by the provisions of the Bill where the use takes place after the appointed day.
Secondly, the Amendment redrafts and, simplifies the transitional provisions of Schedule 4 relating to the infringement of existing patents and applications. Again, the appointed day marks the divide—the old law on infringement applies to acts done before that day, and the Bill provisions to acts done after it. This, however, is subject to the important proviso of paragraph 2A(3), according to which an act begun before the appointed day, which was not an infringement of an existing patent, shall not be an infringement if continued after that day. This
626
is a matter of some complexity, but not, I think, controversial.
Before I formally move the Amendment, I should like to say that there was a point raised by the noble Lord, Lord Lloyd of Kilgerran, about Amendment No. 14 breaking new ground. Perhaps I should point out in connection with Amendment No. 73, that the transitional provisions relating to Crown use, which it introduces into the Bill, do not break new ground but are the natural analogue of the infringement transitional which was in the Bill as published. I beg to move.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 74:
After Schedule 4, insert the following new Schedule: Consequential Amendments—
Registered Designs Act 1949 (c. 88)
1. In section 32(1) of the Registered Design Act 1949—

(a) in paragraph (a), for "the Patents Act 1949" substitute "the Patents Act 1977" and

(b) in paragraph (c), after "1949" insert "or section 106 of the Patents Act 1977".

2. In sections 42 and 44(1) of the Registered Designs Act 1949, for "the Patents Act 1949" there shall be substituted, in each case, "the Patents Act 1977".
Defence Contracts Act 1958 (c. 38)
3. In subsection (4) of section 4 of the Defence Contracts Act 1958, for the words from "Patents Act 1949" to the end there shall be substituted "Patents Act 1977".
Administration of Justice Act 1970 (c. 31)
4.—(1) In subsections (2) and (3) of section 10 of the Administration of Justice Act 1970 for "either" there shall be substituted, in each case, "the".
(2) In subsection (4) of the said section 10, for "(as so amended)" there shall be substituted "(as amended by section 24 of the Administration of Justice Act 1969)".
(3) For subsection (5) of the said section 10, there shall be substituted:—
"(5) In subsection (8) of the said section 28 (which confers power on the Tribunal to make rules about procedure etc.) there shall be inserted at end of the subsection the words "including right of audience".".
The noble and learned Lord said: My Lords, I beg to move Amendment No. 74 formally. I have already spoken to this Amendment.
Schedule 5 [Enactments repealed]:
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 75:
Page 111, line 18, at end insert ("Section 13(4), subject, however to paragraph 1(3) of Schedule 3 above").
The noble and learned Lord said: My Lords, it might be convenient if I speak to Amendment No. 77 as well as this Amendment. These Amendments to Schedule 5 are consequential upon Government Amendments which have already been adopted. I beg to move.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 77:
Page 111, line 43, at end insert:—

("1 amp; 2 Eliz. 2. c. 52.

The Enemy Property Act 1953

Section 8, so far as it relates to the Patents Act 1949, subject, however, to paragraph 1(3) of Schedule 3 above.

5 & 6 Eliz.2.c. 13.

The Patents Act 1957

The whole Act, except in relation to existing applications.

2 & 3 Eliz. 2. c. 32.

The Atomic Energy Authority Act 1954

In Schedule 3, the entry relating to the Patents Act 1949, subject, however, to paragraph 1(3) of Schedule 3 above.

6 & 7 Eliz 2.c.38.

The Defence Contracts Act 1958

Section 1, so far as it relates to the Patents Act 1949, subject, however, to paragraph 1(3) of Schedule 3 above.

9 & 10 Eliz. 2. c. 25.

The Patents Act 1961

Section 2.

10 & 11 Eliz. 2 c. 30.

The Northern Ireland Act 1962

In Schedule 1, the entries relating to section 61 of the Patents Act 1949, subject, however, to paragraph 1(3) of Schedule 3 above, and the entry relating to section 84 of that Act.

1967 c. 80.

The Criminal Justice Act 1967

In Schedule 3, in Parts I and IV, the entries relating to the Patents Act 1949.

1968 c. 46.

The Health Services and Public Health Act 1968

Section 59, subject, however, to paragraph 1(3) of Schedule 3 above.

1969 c. 58.

The Administration of Justice Act 1969

In section 24, in subsection (1), the words "85 of the Patents Act 1949 and section" and "each of", in subsections (2), (3) and (4) the words "of each of those sections" and in subsection (4) the words from "as subsection (11)" to "and" and the words "inthe case of the said section 28".

1970 c. 31.

The Administration of Justice Act 1970

In section 10, in subsection (1), the words "Patents Appeal Tribunal or the" and in subsection (4), the words from "the Patents Appeal" to "and".

1971 c. 23.

The Courts Act 1971

Section 46.

Page 111, leave out lines 32 to 34 and insert—
("sections 34 to 45.
Sections 46 to 49, subject, however, to paragraph 1(3) of Schedule 3 above.
Sections 54, 57 and 58.
Sections 59 to 67, subject, however, to paragraph 1(3) of Schedule 3 above.
Section 68").
The noble and learned Lord said: My Lords, I have already spoken to this Amendment. I beg to move.
The LORD CHANCELLOR The LORD CHANCELLOR moved Amendment No. 78:

1973 c. 4.

The Atomic Energy Authority (Weapons Group) Act 1973

In section 5(2), the words "any provision of the Patents Act 1949 or", "section 46(3) of the Patents Act 1949 and" and "each", subject, however, to paragraph 1(3) of Schedule 3 above.

1973 c. 41.

The Fair Trading Act 1973

Section 126.

In Schedule 3, in paragraph 16(2), the words from "of section 40" to "Commission", where first occurring.

In Schedule 12, the entry relating to the Patents Act 1949.

1974 c. 47.

The Solicitors Act 1974

In Schedule 3, paragraph 3.").

The noble and learned Lord said: My Lords, I have already spoken to this Amendment. I beg to move.
An Amendment (privilege) made.
5.57 p.m.
The LORD CHANCELLOR: My Lords, I beg to move that this Bill do now pass. This matter has been not a war of attrition, but a struggle of endurance and, speaking for the Government, I should like to express our gratitude to noble Lords who have taken part in this difficult operation, so full of technicality, and so wearisome at times to the spirit. I understand that we have achieved, if that is the right word for it, a record number of Amendments to the Bill, not exceeded in modern times, as somebody has said. I am not quoting that as necessarily a merit, but it is a measure of the burden which has been placed upon noble Lords during the six days of discussion in Committee and the three days of discussion on Report.
There were two reasons for this, if I may plead some elements in mitigation. First, there was the extreme technicality of the subject matter; and the other reason for the multiplicity of Amendments was, frankly, the time factor and the need, which was recognised generously by noble Lords, to introduce the Bill in the House before Christmas so that it would be enacted in time for us to become founder members of the European Patent Convention.
My noble friend Lord Oram and my noble and learned friend Lord McCluskey will, I am sure, be happy to join in my expressing gratitude to noble Lords for the assistance they have given. Perhaps
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I may mention one matter about which we had our differences; namely, over the former Clause 49, which dealt with compulsory licences for pharmaceutical products. Noble Lords will remember that I undertook that the Government would move an Amendment to leave out that clause if a satisfactory voluntary agreement was reached with the pharmaceutical industry, but I was unwilling at that moment that the Government's hand in the negotiations should be jeopardised, as I feared it might be, by thr premature removal of that provision. However, all has ended happily and, in the event, despite the demise of Clause 49—or indeed, no doubt some would say, because of it—a satisfactory agreement with the pharmaceutical industry has been reached; and that is a matter which I am happy to record.
My Lords, I should like to express my gratitude for the helpful and constructive suggestions of the noble Lords, Lord Lyell, Lord Belstead, Lord Cawley and, last but not least, Lord Lloyd of Kilgerran. We are grateful also for the interventions from the noble Earl, Lord Halsbury, the noble Lord, Lord Nelson, and other speakers; and I think we can reasonably claim that on this occasion, in the case of this Bill, the House of Lords has greatly improved it from the time of its First Reading in the House. I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(The Lord Chancellor.)
6.1 p.m.
Lord LYELL: My Lords, it falls to me to represent on these Benches the noble Lord, Lord Belstead, and to reply to the very kind and fulsome tributes and comments which have been made by the

631
noble and learned Lord who is at this moment sitting upon the Woolsack. As we have come to this stage in the life of the Bill, I must say that I feel a twinge of sadness, and I wonder about the feelings of your Lordships, in or out of the House, not closely connected with inventions, with shoes, with blinds, with car hoods or, indeed, with the wonders of modern science. I have seen it written that many of the proceedings in your Lordships' House were akin to a ritual clog dance, but certainly I could not come to that conclusion having so often discussed the attachment of soft uppers to stiff backing, certainly from our Benches.
My Lords, I and, I suggest, many others in your Lordships' House were reminded of St. Luke's Gospel, in the New Testament, when we heard that this was the tenth session of the Patents Bill; but I wondered who would fulfil the part of the tetrarch and who else would rule various sectors of your Lordships' House. But, certainly, as the noble and learned Lord mentioned, on this Bill we have had six sessions in Committee and three more on Report, and we have also had Second Reading as well as today's very full afternoon. Indeed, Amendments were moved right through the Bill. It seems light years ago since we started, which I think was the 24th January. In fact, it was a mere 16 weeks when we set out on what I would call our Odyssey. My colleagues and I have learned, we have concentrated, we have laughed from time to time, we have listened a great deal and we have wondered. I believe that all of us have done valuable work.
At this stage we have spent at least 37 hours on the Bill. We have covered a very great deal which is of scientific interest. Let us not forget polytetra-fluoroethylene, chains of polymers and the like, which came in, I think, with the law of confidentiality. The noble and learned Lord pulled me up sharply on that; however, he is his usual charming self today. Above all, my Lords, I have to thank my noble friend Lord Belstead and the noble Lord, Lord Cawley, who unfortunately has not been able to be with us today, as he warned us. Certainly, too, the noble Lord, Lord Lloyd, and the noble Earl, Lord Halsbury; and the members of what I would call the Government triad. The noble and learned Lord, Lord McCluskey, is, I believe, otherwise
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occupied today, but nevertheless I hope that he would feel part of the House for the purposes of these tributes. Also, of course, I should like to thank all those who have been connected with our work on the Bill, both in your Lordships' House and outside. I would add my support to the Motion of the noble and learned Lord, that this Bill should, at last, after 37 hours and ten minutes, now pass.
6.4 p.m.
Lord LLOYD of KILGERRAN: My Lords, may I also thank the noble and learned Lord for his kind words, and add my thanks and praise to that trinity of noble Lords from the Government Front Bench who have worked so hard in this matter. We have had two noble and learned Lords and the noble Lord, Lord Oram; and I see a spirit of devolution having descended upon the Government Benches in this connection. Indeed, from the Benches on the opposite side, too, because those of us who have participated so much have connections with each country of Great Britain.
My Lords, on Second Reading I referred to the Patents Bill as another monster in the jungle of international and national patent law. Since Second Reading this monster has grown from 96 pages to 111 pages—over 16 per cent. inflation in five months, which must bring alarm to all Members of this House and elsewhere. But, as the noble and learned Lord has said, the Bill has been very much improved, and I think it is fair to say that this monster is now far more manageable than it was when it came to us on Second Reading. But whether it will be less expensive in operation, I doubt; and the more I reflect on the patent law the more I am convinced that more will have to be done to simplify procedure and reduce costs than is contained in this Bill. The White Paper on Patent Law, if I may remind your Lordships, said in paragraph 21:
"Existing arrangements for dealing with disputes over patents and appeals from Patent Office decisions are unsatisfactory".
I feel that at least there should be experiments aimed at finding alternative and more rational methods of dealing with patent disputes. It may be that, when the rules associated with this Patents Bill are formulated, that aspect will be borne in mind.

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My Lords, I feel very sincerely, as a person who has spent most of his working life at the patent and trademarks bar, to the exclusion of every other part of the law, that the United Kingdom methods of dealing with patent disputes do not really match up to the needs of industry in the 20th century. In conclusion, I should also like to thank the noble Lords, Lord Belstead and Lord Lyell, for the great courtesy they have shown to me, and for the tremendous work that they have done, not being experts in this field, in assimilating basic matters in a difficult technical field.
6.7 p.m.
The Earl of HALSBURY: My Lords, if an intervention from the Cross-Benches is permitted, I should like to refer to what the noble and learned Lord said about this having been a rather rushed Bill in the first place. He put us on notice in this respect at Second Reading, and we all understand that the rush was due to meeting our international obligations and also our legislative programme. That is an extenuating circumstance, obviously, though I do not think that our proceedings have been a model for such proceedings in the future. This is not the time to argue the recommendations of the First Report of the Committee on Practice and Procedure, which was published, I think, the day before yesterday, but I believe that those of us who have, as it were, borne the burden of the battle and the dust and the heat of the day could have done it in a Select Committee, round a table together. There were ten of us altogether. There were, first, two highly-skilled professionals, the noble Lord, Lord Lloyd of Kilgerran, and the noble Lord, Lord Cawley, who has been backing up and assisting the noble Lords, Lord Belstead and Lord Lyell. Then there were three what I might call experienced amateurs: Lord Brown and Lord Nelson, and I think I could come into that category.
The Government Bench had full backing from the Government machine, obviously, but, even so, the way they mastered their briefs was something to which one should pay a tribute. But I am really lost in admiration for the noble Lords, Lord Lyell and Lord Belstead, for the way they mastered the details of this extremely tricky, technical subject; and I think the Government, the House and the other place
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ought to be extremely grateful to them for the hard work they have done in licking this Bill into shape. I think we have all done our best in a spirit of amity, and we can now send the Bill winging on its way to another place, hoping that, like a homing pigeon, it will return to us in due course, hopefully in recognisable shape.
The LORD CHANCELLOR: My Lords, may I, on behalf of my two noble friends, express our gratitute for the kind remarks which have been made about us. I share the encomiums placed upon the noble Lords, Lord Lyell and Lord Belstead. Their efforts have really impressed me enormously, and I am most grateful to them. May I also thank those who have instructed the Ministers in this matter for their forbearance and patience in introducing me to what has been, too often, very much virgin ground. I am most grateful to them.
On Question, Bill passed, and sent to the Commons.

REDUNDANCY REBATES BILL
6.10 p.m.
Lord WALLACE of COSLANY: My Lords, I beg to move that the Bill be now read a second time. This Bill, which is comparatively simple, is intended to vest in the Secretary of State for Employment the power to vary the amount of rebate payable to employers under the Redundancy Payments Act by order subject to the approval of both Houses of Parliament. In other words, this is simply and purely an enabling Bill; although I suspect the Opposition may challenge the use of the word "purely". Many noble Lords will already be familiar with the way this Act works, but for those who are not it may be helpful to have a short explanation. In 1965, legislation was introduced which guaranteed the worker unfortunate enough to be made redundant a payment on losing his job. Although the employer is liable to make the payment in the first instance, at present he may recover 50 per cent. of the cost by way of rebate from the Redundancy Fund.
What the Bill does is to allow this rate of rebate to employers to be varied between one of 10 different rates over the range of 35 per cent. to 80 per cent. Put

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very simply, the Bill enables rebate to be varied by the substitution in Schedule 5 to the Redundancy Rebates Act of any one of the 10 sets of fractions appearing in the Schedule to this Bill. The 10 different rates of rebate span the range 35 per cent. to 80 per cent. in 5 per cent. intervals, save that the second set of fractions has been calculated to produce a rate of 41 per cent. This is quite deliberate. On an earlier occasion and in another place a Bill to reduce rebate to 40 per cent. was defeated at its Second Reading. Accordingly, at no time in the future will it ever be possible under this Bill as drafted to introduce a rebate rate of 40 per cent. It is not for me to comment on this situation, but I thought it only right to make clear to your Lordships why it had not been possible to adopt precise intervals of 5 per cent. throughout the 10-stage scale.
I would also draw noble Lords' attention to one special feature of the Bill which will not have gone unnoticed. It will amend the Northern Ireland legislation. Northern Ireland is not covered directly by the Redundancy Payments Act 1965, but by parity legislation in the Contracts of Employment and Redundancy Payments Act (Northern Ireland) 1965. The two schemes really are run side by side. In many respects they are operated as a single system, as provided for in Section 58 of the Great Britain Act, which authorises reciprocal arrangements to be made with the appropriate Northern Ireland authority for ensuring full co-ordination. In happier circumstances, it would have been right for Northern Ireland to follow the practice of the past and seek a similar enabling power. However, it was thought right on this occasion to extend a helping hand in the Westminster legislation thus avoiding the lengthy Order-in-Council procedures which otherwise would have had to be adopted. Clause 2 of the Bill, therefore, will, in effect, give the Northern Ireland authorities a similar power to vary rebate, so ensuring that any changes can be effected both here and in the Province from a common date, thus removing the risk of anomalies.
My Lords, I would also wish to be quite open with the House about the immediate use to which the powers in this Bill will be put on receiving the Royal Assent. On 22nd July 1976, the
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Chancellor of the Exchequer made a statement on public expenditure. As he made abundantly clear at that time, reductions in public service borrowing requirements and cuts in public expenditure were essential if the prosperity of our economy was to be restored and unemployment was to be reduced. The point was also firmly made that a shift of emphasis towards selective assistance to industry would have to be offset by certain other measures, including a reduction in the employer's rebate from the Redundancy Fund. Accordingly, the first action to be taken under the proposed legislation will be the introduction of an order reducing rebate to 41 per cent.
Measured against over-all public expenditure and borrowing requirements, the savings which will result from the reduction are not large. The full year saving for a reduction to 41 per cent. is approximately £16·2 million, or approximately £1·35 million a month. I give these figures because I think they may be helpful. It is, of course, impossible to estimate the actual amount which will be saved during the coming financial year, since this must depend on how soon it is possible to reduce the rebate.
Compared with the figure of £1,000 million mentioned by the Chancellor in his July package, these figures are very small beer indeed. But I would emphasise that they must be considered as part of an over-all package which is vital to the healthy economy of this country. However, ever, I do not propose to talk at length on this point. As I said earlier, the Bill provides for an enabling power. It does not, of itself, change rebate in any way. Any such changes will have to be made under the Affirmative Resolution Procedure and noble Lords may consider it appropriate to reserve their comments on this point until such time as an order is laid and the Motion put. In turn, I would ask for your Lordships' tolerant understanding for having departed from the direct scope of the Bill itself. Nevertheless, it seemed both important and right, to me personally, at any rate, that there should be, even at this early stage, a clear understanding of the proposed first use of the enabling power and the underlying reasons. But even putting these considerations on one side, I remain firmly convinced that the Bill itself is an eminently sound piece of legislation.

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The Redundancy Fund is financed by an allocation made from the employer's share of Class 1 earnings-related contributions. This allocation is at present 0·2 per cent. The Fund is intended to be self-supporting. Given the variations which can occur in the number of redundancies each year—and I have with me figures showing that, over the life of the Act, total payments were made from the Redundancy Fund in respect of a maximum of some 370,000 employees in 1971 and a minimum of approximately 177,000 in 1973—it is impossible so to regulate in come that it precisely matches outgoings. For this reason, the Act contains provision for the Fund to be financed by borrowing from National Loans Funds if it is in deficit and for the investment of surplus if it is in credit. But these are intended as relatively short-term measures. In the longer term, it is necessary to have adequate machinery for controlling the flow of income and expenditure so that the Fund may remain in reasonable balance. One way of doing this would be to vary the 0·2 per cent. allocation. But a simpler alternative would be to vary rebate under the provisions of this Bill.
My Lords, let there be no misunderstanding about the state of the Fund at the present time. It stands in credit to the extent of approximately £13 million. If rebate is reduced, the surplus will increase. Although there can be no doubt that this surplus will have a direct beneficial effect on the Public Sector Borrowing Requirement, if it is allowed to grow beyond reason it could certainly give rise to problems in the future. In such circumstances, there is a great deal of merit in a measure, such as that contained in this Bill, which permits changes to be made within the minimum of delay according to the requirements of the economy and the state of the Redundancy Fund.
My Lords, I would commend this Bill to the House as a useful instrument in the administration of the statutory scheme. Through the Affirmative Resolution Procedure, it will ensure the retention of adequate Parliamentary control. It will in no way prejudice or alter the entitlement of employees to their redundancy payments. Its effects will be limited solely to employers. In the short term it will be used to help reduce the Public Sector Borrowing Requirement, thus making its contribution to the Chancellor's July
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package, the importance of which it is difficult to overestimate. But looking ahead into the future, it will also make it both quicker and easier to restore rebate to its present level and to make future necessary changes as and when the economy and the state of the Fund permits.
My Lords, I should like to make a correction. I said that the Fund stands in credit at approximately £13 million. That was what I was advised in the first instance. I have now been advised that the surplus is £11 million.
As I said before, looking ahead into the future, it will also make it both quicker and easier to restore rebate to its present level and to make future necessary changes as and when the economy and the state of the Fund permits. I have no reservations in asking for the support of this House for this enabling measure. I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Lord Wallace of Coslany.)
6.21 p.m.
Baroness ELLES: My Lords, the noble Lord, Lord Wallace of Coslany, has of course put his finger right on it: he said that this was purely an enabling Bill but he was sure that the Opposition would not agree. If he had read the Official Report of another place of 21st March, he would have seen that at col. 919 the Government declared:
"initially, we propose to make an order reducing rebate to 41 per cent.".
So of course we do not accept that this is purely an enabling Bill and that the matter will stop there, because obviously the Government are not interested in passing such a Bill if they are not going to do something with it.
The noble Lord referred to the Chancellor's speech of July 22nd last year, when pressures were put on the Government by the IMF to cut public expenditure in exchange for what might have been regarded as a life-saving loan. While we on this side of the House agree with the urgent necessity for making cuts in public expenditure—and I think we are all agreed about this in this country—and reducing the PSBR, we must question the validity of the statement and the wisdom underlying it:

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"…that a shift of emphasis towards selective assistance to industry would require certain savings in expenditure, which included a reduction in the employer's rebate from the Redundancy Fund from 50 per cent. to 40 per cent.".
That was said by the Minister on 7th February in another place at col. 1126 discussing the Bill in its original form.
My Lords, assistance to industry is not achieved by imposing further restraints and increased expenditure, not only on industry in general but in particular on those firms which are suffering acutely from the economic climate and having to reduce their labour force. They are surely precisely the firms which need help, not further burdens, and we must ask whether Mr. Varley's statement to the American multi-national companies made on 11th May and quoted in the Financial Times of 12th May to the effect that:
"Industrial profits are necessary to pay for social objectives and the Government are giving priority to industry over social objectives".
can really be endorsed by a Bill of this kind.
If Mr. Varley's statement reflects the Government's view, this Bill of course has no basis for implementation. If it does not represent the view of the Government, the sooner the truth is told, the better. The Government are taking every means to expunge the private sector of industry to the great detriment of this country as a whole, and to the workers in particular. The bankruptcy figures tell their own story: in 1973 there were about 3,900 bankruptcies and about 2,500 liquidations. By last year this figure had risen to over 7,000 bankruptcies and over 6,000 liquidations. Each of these figures in themselves represent the human drama of several hundred—if not thousands—of workers having to lose their jobs, and not because of the fault of the employers.
So first it should be clarified that the whole of any redundancy payment is made by the employers. Up to now, 50 per cent. has been borne by the individual employer who has had to make the redundancy, and 50 per cent. has come from the Redundancy Fund to which of course contributions are paid, as the noble Lord correctly and clearly explained to your Lordships. These contributions are paid entirely by employers right across industry under the National Insurance scheme.
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The Fund is not only composed of payments made solely by employers—and perhaps the noble Lord did not mention this but the costs of running the Fund are also borne by the employers, although in fact it is run by the Government. The Government claim back the costs from the employers. It is questionable whether redundancy payments in principle are the right way to set about curing the chronic unemployment which is besetting this country and indeed other countries in Europe, but I do not wish to enlarge on this particular aspect at the moment. I should like to put to the noble Lord that this is surely a subject which should be discussed in a much wider context than just the question of the Redundancy Rebate Fund. I believe that this is a whole area which should be fully debated by this House, another place, and by all those sectors of industry which are concerned, whether unions, workers who are not in unions, the CBI, the Government and so on.
The original Bill, which was defeated on Second Reading, sought to reduce the payment from the Fund from 50 per cent. to 40 per cent. The Bill now before your Lordships' House has much the same effect but under another guise. It is an enabling Bill, as the noble Lord rightly said. As I have indicated, the Government have already declared their intention to introduce an order to reduce the payment to 41 per cent.
In the process, the Government claim that a saving of about £18 million will be made this year by this reduction, and it has now been changed to about £16½ million by the reduction to 41 per cent. My honourable friend Mr. Hayhoe in another place pointed out that the Fund was said to be running at a deficit of about £1½ million per month, which would have totalled £18 million last year, the amount which the Government claimed would be saved. According to my honourable friend in another place —and in fact it was confirmed in a Written Answer he had put down which appears in the Commons Official Report for 2nd May at column 1137—the Fund was in credit to the amount of over £5 million by the end of the year, and the noble Lord has kindly informed your Lordships that it is now somewhere near £11 million. This is despite the new provisions of Sections 63 to 69 of the

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Employment Protection Act, increasing the spectrum which will be covered by the Fund to include insolvency provisions.
So will this Bill in fact make the savings on the PSBR which the Chancellor claimed? Despite the very serious decline in viable businesses which I mentioned in connection with a number of bankruptcies, the Fund has managed to be in credit. By the end of April, we had this figure of over £10 million. Is it not a fact that the basis on which contributions now have to be made by employers—another increase in their outgoings, by the way—that is, on an earnings-related calculation, makes it much more likely that the Fund will remain in credit? Is it not therefore all the more unreasonable—and I use specifically a word which may be possibly acceptable to your Lordships rather than using some stronger term—that the Government should put their hands into a Fund which is contributed to by a specific sector of the community for a specific purpose; that is, to look after those employees who are declared redundant because of the impossibility of surviving the financial and economic difficulties of today?
Therefore, it would seem reasonable to me to ask the Government to reconsider their position in the light of the figures produced by the Answer to that Written Question, which indicated that since the end of December the Fund has always remained in credit. Surely, as a minimum, the Government should undertake not to reduce the amount of rebate from 50 per cent. so long as that Fund is in credit, particularly taking into account the new form of contribution that has been introduced. So there can be no justification for this Bill or for the introduction of an order under the Bill, as has been indicated by the Minister in another place, not only on account of the state of the Fund but also on account of the very detrimental effect it will have, particularly on small businesses; for example, those firms with a few employees, especially family firms, trying to keep their employees and trying to keep going, but being forced to make some redundancies in the present unfavourable economic climate. In fact, they are torn between having to declare their employees redundant and having to carry on with enormous difficulties towards bankruptcy or insolvency, because they have not the funds to make the redundancy
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payments which have to be made, not only under the old Act but also possibly under the potential order which the Government have indicated they will introduce.
Here, what I find so remarkably lacking in understanding is the statement of the Minister in another place on 21st March, reported in the Official Report at column 922. He said then:
"Additional costs of this order should not be difficult to assimilate".
Are your Lordships aware that the present payrolls of large companies which are on the borders of bankruptcy amount to several thousands of pounds a week and the decrease in rebate from 50 per cent. to 40 per cent. of course makes a corresponding increase in the amount the firms have to pay out? That can mean several thousand pounds added to the costs of a firm which regrettably has to declare its employees redundant. I do not think that the Government seem to be at all preoccupied by that or have taken into account the effect it will have on an enormous number of businesses. So this measure, allied to the immediate stopping of the regional employment premium and the new 2 per cent. payroll tax, have all combined to discourage further the private sector of industry. One indeed must ask: in present circumstances and considering the projected plans of the Government, who in this country would be willing to invest in industry?—investment which is so badly needed.
In conclusion, my Lords, the Chancellor's measures of July 22nd now seem totally inadequate, totally irrelevant and indeed, if I may be allowed to use such a word, misleading, when he announced that his so-called package, which included the reduction in the redundancy repayment rebate,
"…will enable us to maintain steady and continuous progress towards full employment without refuelling inflation…".
I quote from the Official Report of 2nd August 1976, Column 1237. Ten months later, with unemployment increasing, nearly half a million young people who are said to be out of employment at the end of this school-leaving year and with inflation running now at over 16 per cent., the Government introduce what can only be called a rather spiteful and harmful Bill, which will do

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nothing to reduce the borrowing requirements of the Government or help the workers of this country who, more than any other sector of the population, stand to benefit not from industrial decline but from industrial prosperity.
6.34 p.m.
Lord ROCHESTER: My Lords, as the noble Baroness, Lady Elles, has just reminded us, the Government have made it plain that, although this Bill is an enabling one, it is the intention that under it in the first instance an order should be made, reducing the amount of rebate payable to employers from 50 per cent. to 41 per cent. under the Redundancy Payments Act 1965. We on these Benches feel, as clearly does the noble Baroness, Lady Elles, that that is wrong in principle for a number of reasons, which I should like briefly to speak about—briefly, because the noble Baroness has covered many of the points I might otherwise have made.
The Government are constantly saying that a basic tenet of their economic policy is to promote investment by transferring resources to industry; with that aim we on these Benches are certainly very much in agreement. But those words, we have so often found, are not matched by deeds; and the action that is now contemplated is to take money away from industry. The amount involved is not large, particularly when compared with the 2 per cent. surcharge on employers' National Insurance contributions, imposed last autumn, and which employers are now having to pay. But it is no more desirable for that, and surely this further imposition will add, however marginally, to unemployment just at the time when all our efforts should be bent towards creating new jobs. As the noble Baroness has already said, it is just those firms which are in the greatest financial difficulty, and which, therefore, are having to declare redundancies, which will have to find this additional money.
Secondly, when the original Act of 1965 was introduced, it was made plain that the Redundancy Fund would not be used for any purpose other than to finance a redundancy payment. Yet it is the Government's avowed intention, we have just heard from the noble Lord,
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Lord Wallace of Coslany, to use that saving they will now achieve to reduce the public sector borrowing requirement and to use that money for other purposes. There may be a case for reducing the rebate to employers when there is a deficit in the Redundancy Fund. There can surely be no case when it is in surplus to the extent that it is—of more than £10 million—and when, as we have been reminded, that surplus is growing.
Thirdly, the Bill in its original form at least had the straightforward aim of reducing the rebate from 50 per cent. to 40 per cent., but, as the noble Baroness has said, that Bill was rejected only three months ago in another place. To put it bluntly, we dislike the way in which the Government are now seeking indirectly to achieve an aim which was then out-voted in principle. The dilemma in which the Government therefore find themselves is well illustrated by the complicated fractions to which reference has been made in the Schedule to the Bill, so as not to fall foul of the Public Bill Office.
Finally—and this is the point on which I feel most keenly: it was touched on by the noble Baroness, but I should like to elaborate on it a little—it would surely have been much better for the Government, before seeking again and so soon, to effect a saving which anyway is of a relatively small amount, to have embarked on a thorough-going review of redundancy and indeed of other payments which are related to this great problem of unemployment.
In a recent debate in your Lordships' House on unemployment, I made the suggestion that it would be better that those aged, say, 60 should be encouraged to retire prematurely rather than that there should continue to be so much unemployment among young people. To a limited extent, voluntary early retirement to achieve that aim was the stated purpose of the Job Release Bill, which we discussed soon afterwards.
But one of the difficulties which arose in discussion of that Bill, about getting elderly people in employment to accept the financial inducement which would enable them to retire early, was the adverse effect which they felt this might have on their occupational pensions. If the problem cannot be resolved in that way, what

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about making lump sum redundancy payments relatively even more attractive for people in their late fifties and in their sixties, so as to achieve the same end in another way? This has proved a paying proposition in many progressive firms, and is equally acceptable to the employees of those firms. Why should it not have more general application?
I found it very depressing to read in one of this evening's newspapers, a report that the Union of Post Office Workers has today approved a deal which goes in precisely the opposite direction, in allowing them, as I understand it, to work until at least the age of 65, instead of retiring now, presumably, at 60. What possible justification can the Post Office have, in times of heavy unemployment such as those we are now in, for doing this? And what of the further demoralisation of young people which this may bring about—young people on whom the future of our social democratic way of life quite literally depends? That is a digression from the Bill, but not I suggest completely irrelevant to it.
The basic point I was seeking to make is that it is high time for the Government to undertake a comprehensive review of the effect of payments, under a number of apparently unrelated schemes, on this fearsome problem of unemployment, particularly among young people, rather than that they should go on dealing with it in what we can only regard—and I am sorry to say this—as a piecemeal and ineffective way. It is on account of that basic failure, as we see it, and for the reasons that I gave earlier, that we on these Benches do not feel able to support this Bill, nor the immediate use that it is intended to make of it.
6.44 p.m.
Lord GEORGE-BROWN: My Lords, I am very grateful to the Minister for being kind enough to withhold his reply for a minute or two, while I— although I have not put my name on the list—intervene briefly. I do so because what, with the exception of what the noble Lord, Lord Rochester, said at the end of his speech, seems to me the attitude of mind of those who have taken part in this debate is quite contrary to the approach which, with respect, we should now be making. Because we have a very
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high apparent level of unemployment, measured by those who sign on at the labour exchanges, we become led, as I think the noble Baroness allowed herself to be led, into the thought that we must at all costs try to avoid that number increasing, and we do that by keeping people in their present jobs in their present industries. I should have thought that that was totally contrary to any economic industrial strategy that the country should at this moment be following. We are at the moment using too many hands to do too little. That is what we mean when we say that our productivity is so much less than that of our competitors on the Continent.
The immediate corollary of that is that any steps we take should be such as will encourage—to use a phrase which the noble Viscount, Lord Amory, will recognise—the shaking out of people, who are at the moment not fully employed, from their posts in industry. If that increases the numbers signing on at what I believe are now called employment centres, but which are known better to me as labour exchanges, then we must find other ways of dealing with that. One of them, to which the noble Lord referred, and which the Post Office workers seem to have gone against, is of course to make early retirement easier and more comfortable. Another, which he personally will know very well, is to provide much more adequately for the retraining of those who are retrainable—not everybody is; it would be hard to train many of us for much else, at our age of life—by a massive increase in the finance and the facilities for doing that. It is still ridiculous that we compare so inadequately with what a little country like Sweden does in this regard.
There are many ways by which one can deal with the consequences of high unemployment. But if we are very cruel, in order ultimately to be kind, a large increase in unemployment is an immediate and necessary requirement if we are to make industry more competitive. My difficulty with this Bill is that it seems to me to do exactly the opposite. I do not necessarily follow the noble Baroness and the noble Lord in their cries on behalf of the hard-done-by employer—I am happy to leave that to them—but I share the ultimate conclusion, even if I reach it by different steps, that this is not the

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moment at which to make it more costly for an employer to declare redundancy. If anything, this is the moment to make it more cheap for him to declare redundancy, so that we encourage him to do so, and you certainly will not do that by increasing the amount which he has directly to find, which is what this Bill does.
We are all full of the inequities—to take a less important sector, perhaps—of over-manning in Fleet Street. We have all been made very aware of it in the last week or so, because of the London Evening Standard and Evening News situation. The manning is simply enormous. The amount that would have to be paid for redundancy, to those who lost their jobs because of the merger, would run into millions and millions of pounds. A similar situation, applies to the knowledge of many of us, in manufacturing industries and people tend not to face what would, industrially, be a dreadful headache, of persuading the trade unions to allow the redundancies to be created, because, in addition to that, they then have to find a very large additional sum of money if the 50 per cent. rebate is cut to 41 per cent.
So that, without developing the point at great length—and I did come in rather late, and was tempted to speak by having heard what there has been of a debate—I thought I would say to the Government, very firmly, that even if they get this Bill they ought to think very hard before they make the order. If we have to make savings, I would much rather see a cut in the employment subsidy except in those areas where, for social reasons, we want to attract new industry. I would much rather see an increase in the payment out for retraining and the maintenance of, or even an increase in, the payment out to encourage redundancy.
Viscount AMORY: My Lords, I am sure that what the noble Lord is saying is extremely relevant to the general problem we are discussing. Am I right in thinking that the noble Lord is saying that more emphasis should be put upon the creation of new jobs rather than upon the preservation of existing jobs?
Lord GEORGE-BROWN: My Lords, exactly so. I wish I had put it so succinctly. Indeed, the noble Baroness used the phrase, "the creation of new
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jobs" when she was speaking about the encouragement of people to stay in their present jobs. I agree entirely with the noble Lord's formulation. Emphasis must be placed upon getting people out of where they cosily are and into new jobs and new places where they will exercise new aptitudes, if not skills, even at the cost of disruption to their lives.
Putting it as responsibly, respectfully and affectionately as I can to the Government, I believe that this Bill has got it frighteningly wrong. I suspect that what happened was that they came up against a practice which most of us who have been Ministers know has operated many times in the past. In the old days it was our own Treasury, but in this case I suspect that it was the IMF who went along to the Government and said that the public sector borrowing requirement would have to be cut by X hundreds of millions of pounds, correct to the final 50p. We have just seen how impossible this is, for the Minister reduced the figure of £13·5 million to £11 million in the space of one sentence. But never mind! The IMF want it to be done and they fix a figure; then every department has to contribute towards the cut.
In the days of the 1945 and 1964 Governments, of which I was a member (happily in one way and regretfully in another, because it makes me seem so old) we were always in the position of trying to make up the last £10 million or £11 million —as though it mattered a tuppenny damn in the end! Therefore we did things which, because they made the sums come right—E&OE—were in themselves wrong. I believe that this is what has happened here. The Government have satisfied the IMF by reducing their total requirement for PSBR by the agreed figure, and in the course of doing so have been reduced to a form of economic strategy or strategic planning which makes a nonsense of everything else that they are trying to do and that the IMF wishes them to do. If somebody were to put this to the IMF team, who are either here or on their way here, I am quite sure that they would see the point.
I shall not go to the extent of voting against the Bill, although I think there is a great case for doing so. However, I urge that further thought should be given by the Government to the question of

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whether we should rush into making an affirmative order. I wholeheartedly support the two previous speakers when I say that perhaps we should have a much wider debate about economic and strategic thinking and the place that all these various parts play in it. Since the Government are not in a hurry for legislation at the moment, I understand, perhaps it might be put to the legislation committee of the Cabinet, if such a body still exists, that this is a very good way in which, from the Party managers' point of view, they could waste Parliamentary time. Then we might do a useful job in guiding them on the steps they should take on both this and various other subjects. I am very much obliged to the Minister for allowing me to say this.
6.55 p.m.
Lord WALLACE of COSLANY: My Lords, I have a rather difficult job to tackle in summing up the debate on an obviously unpopular measure, so far as the Opposition are concerned, which is before the House. Perhaps I may deal first with the remarks made by my noble friend Lord George-Brown, because he is an old colleague. He and I are, I hope, still members of the same trade union. I am a life member of it.
Lord GEORGE-BROWN: My Lords, I still pay!
Lord WALLACE of COSLANY: My Lords, my union did me an honour. Perhaps my noble friend will deserve his later. My noble friend has touched upon a very important point. So far as the employment and economic situations of the country are concerned, there is an urgent need to retrain our young people and to train semi-skilled people to do skilled jobs. There will be a further opportunity to debate this matter. I am awaiting—as, indeed, many are—the recommendations of the Manpower Services Commission. The noble Lord, Lord Rochester, may have better information than I about this. However, it is conceivable, although I have no authority to say so, that before very long the Government must state their conclusions. That will give us a peg on which to hang a major debate on the employment situation on the lines that the noble Lord, Lord Rochester, wants. I agree with this,
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because many problems are left unsolved, even after our unemployment debate and today's tiny debate.
A great deal of huffing and puffing has been done tonight by the noble Baroness, Lady Elles, and the noble Lord, Lord Rochester. The Bill is designed to allow the Minister to introduce an order, subject to the approval of both Houses, which (who knows?) they may accept or reject. It will not be at an enormous cost to the employer.
Baroness ELLES: My Lords, perhaps the noble Lord will allow me to intervene. Is he then able to withdraw the statement made by the Minister in another place that initially an order would be introduced to reduce the borrowing power from 50 per cent. to 41 per cent.? It would give us great encouragement if we knew that an Affirmative order was not going to come early.
Lord WALLACE of COSLANY: My Lords, I stated in my opening speech that once the Bill is passed an order will be introduced but that it will be subject to the approval of both Houses. Then we shall see whether both Houses accept it. The purpose of the debate today is to allow the Bill to go through, and then to see what happens to the order when it is laid. The average redundancy payment, in round figures, is about £600. Under the present rebate scheme, the employer gets a rebate of £300. Under the 41 per cent. proposals—and more of that in a moment—it would be reduced to £240, resulting in a drop of £60. This is not much more than an average employee's wages, anyway.
The noble Baroness made a strong attack, as I expected, because I have read Hansard and I know about the fun and games that another place had over the Bill. Incidentally, I understand that the first defeat arose as a result of one of the Conservative colleagues of the noble Baroness in another place. It was a complete surprise both to the Opposition and to the Government. The colleague concerned went home, not thinking that there was to be a vote. Apparently the Whips got their arithmetic wrong and consequently there was a defeat. However, we have the new Bill which contains some improvements, because the Affirmative Resolution is now embodied in it. The noble Baroness asked whether employers can afford this.
Baroness ELLES: No, my Lords, I did not say that.
Lord WALLACE of COSLANY: Then, my Lords, she suggested that it would be a strain on employers. As I have already said, it should be borne in mind that the average redundancy payment at the moment is £620, of which half can be recovered from the Redundancy Fund. Therefore in many cases an employer will recover the additional costs through wage savings over a comparatively short period. It is also true that employers have continued to make payments in substantial numbers, and I have no firm evidence that the cost of the statutory payment has proved to be an active deterrent. If real financial difficulty exists, then the Redundancy Fund may bear the whole cost of the redundancy payment and recover the employer's share at a later date. It is true that the total cost is borne by the employer, and in this case paragraph 95 in the redundancy scheme booklet says:
"An employer who admits liability for a redundancy payment but is unable to meet it because of financial difficulty, should explain his problems to the nearest employment office of the Employment Service Agency and be ready to send to the specialist officer of the Department of Employment, a statement of account or a written statement from an accountant or a solicitor, stating the position".
So that in times of acute financial pressure on a small employer there is some relief for him.
It has been suggested generally that there is no relief of public expenditure and that in fact there will be no real savings. It is true that public expenditure is of different kinds, and there is plenty of scope for argument about whether transactions should be included in public expenditure figures; but it is a matter of fact that the expenditure of the Redundancy Fund in respect of rebates to employers has been counted within the public expenditure programme for some years, including during the time of the last Conservative Administration. Income to the Fund is also taken into account in the Financial Statement and Budget report, together with any other income such as taxation, and if the Fund is in deficit it can borrow from the National Loan Fund, which involves a direct charge to public funds by any definition. On the other hand, if it is in surplus, the surplus has the effect of reducing the public sector
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borrowing requirement. How does it do that? When the Fund is in surplus the monies are handled in what may be regarded, for the sake of easy understanding, as three separate accounts: a current account, a deposit account and an investment account. The first or current account is operated by the Paymaster General as the paying authority and is fed only with sufficient funds to enable the day-to-day outgoing payments to the Fund to be met.
The second account, which can be regarded broadly as a deposit account, is used for surplus which may be needed fairly quickly or which has to be held temporarily until investment can be made. In short, the money is put into Ways and Means, which is part of the Consolidated Fund and results in the payment of interest, usually a little below the Treasury rate for bills. The third or investment account is that operated under the authority of Section 26(3) of the Redundancy Payments Act 1965. Investment is made through the National Debt Office, usually in either Treasury bills or Treasury stocks, and any surplus in the Fund therefore will become available through the public sector use, which in turn must reduce the borrowing requirement. That, basically, is the reason why this Bill is before the House, and the Affirmative Resolution will be placed before the House in due course. So there is some small—certainly not very large—saving, but small savings as well as large savings are important in the present economic situation.
As usual, the noble Lord, Lord Rochester, made some interesting suggestions, and certainly with the last one about age 60 retirement I have a degree of sympathy, but of course in this matter sympathy is not enough. He has made the proposal before and it is an interesting one, but it would mean a major change in social security policy, as I think he will readily admit, and it is certainly outside the scope of my Department. This is a line which is being put forward by many organisations and individuals but, quite frankly, at the moment the economic position does not warrant acceding to it.
The noble Lord suggested that there should be an overall review of all the various schemes, some of them temporary

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and some of them permanent, that the Department of Employment is putting forward at the present time to relieve the employment position. The blunt fact is that all employment measures are under constant review. The machinery exists in the Department to do this, and there is a regular routine review of all the various forms and measures that are being employed at the present time. Although it does not come in as a form of review, the noble Lord and other noble Lords will he interested to know that there is a possibility shortly of the Employment Protection Bill 1977 being considered by the Joint Committee on Consolidation Bills, which will bring together convenient statutory provisions covering employers' rights as contained in the following Acts: The Redundancy Payments Act 1965, the Contracts of Employment Act 1972, the Trade Union and Labour Relations Act 1974 and the Employment Protection Act 1975. The first two Acts will be consolidated in full, the last two Acts will he consolidated to the extent that they are only concerned with the individual rights of the employee. The Bill which will come forward will in no way change employees' rights but it is a useful step forward in making them easier to identify and understand. The Bill does not cover any provisions relating to trade unions, employees' associations and collective bargaining, which it is proposed to consolidate later. At least the consolidation is a move to get things on a simpler basis and we all wish for some improvement in the employment situation. Any constructive suggestion will never be neglected.
I do not think we should make too much heavy weather over this Bill. It is an enabling measure. It is true that in the present economic situation there will be a move to bring in the Affirmative Resolution to reduce to 41 per cent. On the other hand, it must be recognised that the enabling Bill also allows an Affirmative Resolution to be passed, to put it back as soon as the opportunity arises to 50 per cent. and indeed, if the economic situation improves still further, even to go a little above that. That is possible, so it is not a Bill which is brought in simply to achieve one objective, as may be suggested by some noble Lords. It is a Bill to assist—in a small way, I frankly admit—the present economic situation, but, on the other hand,
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the Bill will allow quick and prompt adjustment in the, I hope, not too distant future when, as we all hope, things improve economically in the country.
There will he an opportunity for further debate at the Committee stage, when no doubt Amendments will be put forward, but I ask the House to give this Bill a Second Reading. It had exhaustive examination in another place, as noble Lords who have read Hansard of another place will have seen, not only on Second Reading but in Committee and on Third Reading. It was subjected to a vote; it has been carried in another place. I ask your Lordships to allow a Second Reading now, and we may have our arguments in Committee.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

NORTH SEA OIL BLOW-OUT
7.10 p.m.
Baroness WHITE: My Lords, I beg to put the Question standing in my name on the Order Paper: namely, to ask Her Majesty's Government what lessons have been learnt as a result of the recent oil platform blow-out in the North Sea.
My Lords, as this is a debate to which I have no right of reply, perhaps I could at the very outset thank my noble friend Lord Strabolgi for the immense amount of work that I know he has put into this subject, and also thank all noble Lords who will be taking part in the debate.
One should at the very outset make it clear that Her Majesty's Government have no responsibility whatever in the matter of the Ekofisk incident. It did not occur in the part of the Continental Shelf for which we have responsibility. We offered assistance to the Norwegian Government, whose responsibility it mainly was, apart from the responsibility of the operator himself, but I understand that we were not able to offer the Norwegians any assistance for which they could find any use, and therefore we have not been directly concerned.
But, plainly, further incidents are to be expected, and sonic of them in the normal course of events are likely to take place on our side of the line. Therefore, it

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behoves us to learn all the lessons which we can from this experience. My right honourable friend Mr. Wedgwood Benn, in reply to Questions in the other place yesterday, said:
"We must see that should such a thing occur again our resources will be adequate. I am not entirely satisfied that this is now so".
It is, of course, too soon to expect a complete evaluation of the experience gleaned from the Ekofisk mishap. It was three weeks ago, on 27th April to be precise, since Mr. Wedgwood Benn announced the setting up of a study group drawn from six Departments, including his own, plus the Health and Safety Executive, to go into the matter. One could not help asking oneself what was the relation of this study group to the body known as Scopcas, which is under the surveillance of the Department of Trade. Then, of course, the United Kingdom Offshore Operators Association has been busy. There is the North Sea Operators Clean Seas Committee. The Norwegians have been making their investigations. The non-governmental bodies, such as the Advisory Committee on Oil Pollution of the Sea, of which I have the honour to be chairman, its Nordic counterpart, and other voluntary organisations, such as the European Environmental Bureau, have all been trying to learn what they can. I understand that the Norwegians have called for a conference to be held in June to sum up the matter. Signor Natali, the Commissioner in Brussels responsible for EEC environmental affairs, has suggested it should be referred to the meeting of environment Ministers also to be held in June in Brussels. In other words, there are very many fingers in the oil slick, and one cannot help being somewhat concerned at the plethora of committees, investigations and other bodies which are concerned, and which are likely to spend a great deal of time travelling to one another's countries to tell one another what they think. So I shall be glad to know how Her Majesty's Government view all this, and what element of co-ordination we are succeeding in establishing within our own domestic regime.
But before I put some specific questions on that point, I think one should perhaps put the Ekofisk incident in perspective.
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I think we would all agree that the main risk with such volatile oil was of fire. Thanks to the care and skill of Mr. Adair and his team, this major risk was avoided. But much North Sea oil is of a similar character to that of the Ekofisk field, and we might not be so lucky next time. my first question is, therefore, whether Her Majesty's Government are satisfied that the fire-fighting vessels povided by the various operators are adequate in themselves—that is, in equipment, in speed and the like—that they are sufficient in number and suitably placed to reach any accident at a North Sea oil installation in time to be effective, that communications and agreed chains of command between the individual operators are such that difficulties can easily and quickly he overcome.
I understand that earlier there was talk of a combined North Sea fire-fighting force, but I understand that this proposition fell through and that operators have been making their own individual plans. This division of responsibility does cause many of us considerable disquiet. The Department of Energy is responsible, with the Health and Safety Executive, for safety on oil installations within the British zone and lays down conditions for the offshore operators. But, if things go wrong, what happens occurs not on land but in a marine environment, and this is extremely important. It is an environment with which the Department of Energy, a land-based Department, is not necessarily familiar. Responsibility for dealing with oil on the sea—that is, with oil pollution in all its manifestations—rests with the Department of Trade, and one would like to know what is the relationship between these rigs and platforms, which seem to be regarded as tiny areas of land within the marine environment, and the sea-based services on which they may have to depend in case of any major disaster. Do they understand one another's language, and I mean this almost literally. Do they have joint inspections? How close in practice and at operational level is the co-ordination between land-based and sea-based administration? What instruction or training in sea safety practices is given to oil rig crews? Such may be needed in North Sea conditions, which are very different, of course, from conditions in the Gulf of Mexico, to which many of the American operators are accustomed.

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May I mention one area of doubt. I have recently had discussions on communication systems between shore and sea in oil pollution situations. I was astonished to find, for example, that the system of VHF communication normally used by helicopter crews is not compatible with that commonly employed at sea. Aeronauts and mariners apparently have gone their different ways. Are British communication systems compatible with those of our North Sea neighbours? The oil rig operators are accustomed, of course, to communicating direct with their tower block offices on land. They are required, I believe, to keep marine equipment to hand; that is, equipment suitable for marine communication. But it seems to me very doubtful whether they pay much regard to its maintenance, or conceivably whether they know how to use it. That is one small, but in certain circumstances possibly quite significant, example of the difficulties which can arise when one is dealing with industrial organisations in the middle of the sea.
I do not know whether my noble friend would be in any position to say what stage has been reached in discussions on another matter which is germane to the fire risk especially; that is, whether or not separate platforms are likely to be required—I must say at vast expense—as potential refuges in case of the kind of disaster which might have happend at Ekofisk, although in fact most happily it did not. I shall be surprised if he can given any definitive answer; but if he were able to give us any indication of Government thinking it might be very helpful.
The fire risk, as I say, was quite obviously the main concern at Ekofisk. But, of course, we have to consider the fact that quite a considerable amount of oil was lost. It is true it was only something in the neighbourhood of 20,000 tonnes, which is not much by comparison with nearly 120,000 tonnes which was lost from the "Torrey Canyon". Nevertheless, it is too much, and I shall return to oil recovery problems in a moment. Then, of course, the third area of concern was the possibility of environmental damage by oil which reached the shore, by damage to marine food chains, by direct effect on birds and on fish, including spawn and fish lavae. In this context one must say that if we had to have a North Sea blow-out, then the Ekofisk field was probably as good a place
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to have it as any and the time of year could have been much worse than the end of April—because at that time relevant fish spawning was not endangered and the most important seabird groups were at their breeding grounds and not on the open sea.
The amount of oil to reach either British or Norwegian shores seems likely to be a very small proportion indeed of the total. Therefore, in this case, this does not seem to be any major problem. I have heard that the sliktrak forecast put the figure of possible 40 tonnes reaching the British eastern seaboard, with Lincolnshire as the most vulnerable area. Possibly my noble friend has more up-to-date information. In any case, the quantity is far smaller than the total loss would suggest. It is estimated that a considerable proportion of the oil evaporated within the first few days, and although the residue might thicken somewhat if it reached the shore—it may have become compacted—it is not the tarry, treacly stuff which one sometimes gets from other sources which can be so disagreeable and damaging.
That brings me to the controversy and the difference in emphasis between the Norwegians and ourselves over mechanical versus chemical methods of treating oil spills at sea. I am sure that we should all be extremely grateful if my noble friend can enlighten us further on this situation. Everyone acknowledges that the chemical dispursants which are now in use are very much less harmful than those used at the time of the "Torrey Canyon" disaster just over 10 years ago. Nowadays they are also used much more sparingly. Happily, we no longer have rockpools and beaches drenched with chemicals which are often more harmful than the oil itself.
In this country we have accumulated and distributed to the various local authorities concerned considerable stocks of improved dispersants. However, some of us question to what extent commercial considerations have entered into this These dispersants are manufactured and may well be a profitable product; this may, perhaps, colour the attitude towards their use. They are relatively simple to employ. The oil companies themselves make some of them. As we know, our Norwegian neighbours—and this has been much publicised in the Press—refuse to touch them. This obviously makes one question

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their use, because no chemical dispersant is likely to be completely harmless. I believe that that is recognised.
However, I should like to know what research is in hand on the long-term effect of chemicals on the marine food chain, on fish spawn and young fish, and in what circumstances Her Majesty's Government consider that that they should properly be used. What research is taking place on the effect of the chemical residues of oil after evaporation? Is there any synergistic effect between dispersants and the chemical residues of oil. To what extent do we have a scientific basis for our policy in this matter? It is important to recognise that one cannot generalise on this; one must particularise because, for example, what could be damaging inshore to molluses could he tolerated perfectly well in mid-sea by adult fish. In fact, up to a point fish seem to thrive on oil.
However, there are many different varieties of oil. I have been surprised to learn, for example, that Kuwait crude is less toxic to fish than the lighter aromatic oils of the North Sea. In my innocence and ignorance, I had supposed that it would be the other way round. What analysis do we have of the oil at each well point—in our section, at any rate, of the North Sea—of its dispersal characteristics, its toxicity and possible effects in relation to marine life?—because each oil may be different as, for example, the products of the Ekofisk Field and the products of the Mesa Field are radically different. One is a light aromatic oil; I am told that the other is like liquid boot polish. The danger of the Mesa Field is that it is so close inshore that anything that went wrong in that particular situation, very close to the Moray Firth—which is an ecologically vulnerable area—might be very serious indeed.
That brings me to a further question. How adequately is knowledge made available to oil well operators, who are basically engineers, of the particular ecological hazards relating to their own type of oil in its particular location at various seasons of the year? I fully recognise that in practice one should call in the experts when things go wrong and that the judgment of lay people with dangerously little knowledge can be much at fault. However, I also believe that in
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an emergency the expert can make his points and give his advice or instructions more effectively and intelligently to someone who already has enough background information to grasp what he is talking about and to appreciate the reasons for certain requests or requirements. In my experience, engineers and ecologists seldom meet unless somebody brings them together. I should like to know who is doing that in the context of the North Sea.
In some areas fish matter most; in others it can be birds. I speak now of the ecological and wildlife aspects. Internationally, it is Britain's seabird population that is regarded as our most important contribution to the world's dwindling resources of wildlife. I am told that although our ornithologists, and in particular The Royal Society for the Protection of Birds, know a great deal about the habits of birds on land and inshore, and especially about their breeding colonies, far less is known about their habits in the open sea, the routes they take and the timing of their operations. If we should he unfortunate enough to have another blow-out towards the end of July or early in August, I believe that many birds of certain important species could be trapped at sea when the adults are moulting and the young birds not yet able to fly strongly, so that they remain for long periods on the water.
But we do not know enough, and this is a field in which the National Environment Research Council could perhaps step in and help us to find out. Perhaps my noble friend could ask the Council whether it proposes to do so. It seems that we need a great deal more basic knowledge of the kind to which I have referred if we are to make sound judgments as to the methods to be used to deal with large-scale oil spills, which we must expect from offshore operations in the future. The ecology of the North Sea is known in certain aspects, but hitherto it has not been studied adequately in relation to these offshore oil operations.
That brings me back to the question of oil recovery versus dispersants. In pursuit of both methods, British scientists and technologists have put in a great deal of work in the 10 years since the "Torrey Canyon" disaster. I, personally, should like to pay particular tribute to

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the staff at the Warren Spring Laboratory as well as to the staff of certain of the leading oil companies and to some enthusiasts in the Royal Navy. I have indicated the sources of our disquiet about the use of chemical dispersants, although in some situations I am sure that they may be regarded as essential. However, in the open sea nature takes a hand and disperses much oil without aid. But oil dispersed, whether chemically or naturally, is oil lost to use by man. One cannot help asking whether we have put enough money and manpower into our research and into mechnical recovery. I cannot help doubting it. So far we have nothing effective in sea states likely to be found in the North Sea, though several devices can work reasonably well in harbour or in calm or closed waters.
The Norweigians used their devices on the Ekofisk slick. We sent our Warren Spring vessel "Seaspray", though frankly it was not expected to be operational; it was exclusively experimental. I have heard various figures mentioned of the amount of oil actually recovered. Somewhere between 800 and 1,000 tonnes I think is the most reliable. But I should like to ask my noble friend whether he can give us any indication as to how seriously the Government are taking this matter and how much further effort and resources they hope to put into it.
I should like to mention one matter about which I have been in correspondence with the Departments concerned; namely, the proposal put to me that if we are to take seriously possible recovery of oil on the high seas, then it is essential to have vessels large enough to receive any of these residues. For this purpose, the most likely solution would be to use some of the laid-up tankers which have been displaced by modern giant oil carriers, and to use them as reception vessels into which one could pump the oil and water mixture for separation, if possible on the spot, if we find ourselves able to gather it by improved boom and skimmer devices.
The disappointment some of us have felt so far about the lack of success of these devices may perhaps be short lived if more recent experiments prove to be successful. The real problem of trying to gather oil together in the North Sea, quite apart from weather conditions, is that most of the North Sea oil is so
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thin and spreads so rapidly. I am told that the thickness is not more than 0·1 millimeter. You cannot gather that quantity of oil unless somehow you can mechanically concentrate it. That seems to be a major technological problem, but I cannot believe that it is beyond our resources to find some method of doing it.
I should mention a matter which did not arise out of this particular incident but might have arisen in so far as Ekofisk is connected by pipeline to land; that is, how adequate do Her Majesty's Government believe inspection of pipelines is in North Sea conditions. I do not profess to have any technical knowledge about this matter, but one hears constantly rumours and suggestions—I do not put them higher than that—that accidents could occur; that the conditions in the North Sea are such that the casings of these pipes could be damaged; that, although they have arrangements for metering the oil flow, these can be affected by temperature and are not entirely reliable; that they have safety valves which should come into operation if there were to be a leak, but if there were a slow leak again they may not be sensitive enough.
What one is concerned about here is the pipelines not so much in the open sea but as they come inshore where you have ecologically very vulnerable areas. One is thinking of places, for example, like Sullom Voe. I should like to be reassured that the Government are satisfied that adequate tests are taken and adequate inspections made of the pipelines as well as the other installations on the platforms themselves because there is a good deal of anxiety about this. Some of it may be ill-founded. It would be helpful if we could know more about it.
Finally, I want to come to some organisational and legal matters. First, the relationship between Her Majesty's Government and the oil operators. I understand that safety and pollution avoidance plans are submitted to the Department of Energy as part of the licensing procedure, but these are submitted on a commercial in-confidence basis. Outside organisations who may be interested in the matter have no right to be informed. How can we be satisfied, for example, that adequate account is taken of the need to safeguard areas that

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are ecologically vulnerable? What action is taken to ensure that these statements of intent prior to licensing are, in fact, carried out?
What is the nature of the inspection procedure, and again what reports, if any, are available to interested bodies? Are Her Majesty's Government satisfied that all oil spills are reported? Even a small spill can be informative. We have some reason to think that not all oil spills are, in fact, reported. If they are fairly small they are apt to be concealed. Is there any central register of spills, which could of course include ship generated as well as offshore generated? If so, should it not be an open one? The total figures of ship generated oil spills at any rate are issued from time to time by the Department of Trade, but the number reported by them is five to six times fewer than the number reported, mainly by local authorities and Her Majesty's Coastguards, to the Advisory Committee on Oil Pollution in the Sea for its annual review of oil spills off United Kingdom shores.
This may be due partly to spills being, what you might call, "twice sighted" as they move along the coast, but one cannot tell without an open register. The public has a right to know the true position. But the inspection procedure is of paramount importance. In using even tried technology in unfamiliar conditions, which is the state of affairs in the North Sea, a highly qualified inspectorate could be extremely helpful to operators as well as safeguarding the public interest. For example, one cannot help asking whether, if inspection were adequate, the upside-down incident would have ever occurred. Someone not there just for the daily job but coming in with open eyes from outside might possibly have spotted the danger of such an item of equipment.
What is the standing of inspectors who visit the oil platforms? Are they concerned solely with safety of operation or do they take environmental factors into account as well? Do they have, in other words, a role comparable with that in other circumstances of Her Majesty's Alkali Inspectorate? In addition to inspectors, one also needs adequate monitoring. By that I mean being able to identify oil spills on the water. This can no doubt
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best be done from the air. What plans do the Government have for such a service, and what collaboration or co-ordination is there in this and comparable matters with our North Sea neighbours? Possibly this is a matter which could be dealt with under the Bonn Agreement of 1969. I was glad to be informed only today that Her Majesty's Government are now satisfied that the Bonn Agreement will cover offshore as well as ship-generated pollution in the North Sea.
Finally, can my noble friend give even a rough estimate of the cost of the Ekofisk incident? Does this experience in any way modify the views of Her Majesty's Government on the liability limits included in the 1976 Convention on Civil Liability for Oil Pollution Damage, about which some of us have been fairly sceptical?
I have given my noble friend notice of a further question which frankly does not arise out of the Ekofisk incident and, therefore, is perhaps strictly not in order; but as he has had notice of it if he were able to reply it would be helpful to many of us interested in oil pollution matters. What action do Her Majesty's Government contemplate to secure observance in the congested Strait of Dover of the traffic separation schemes which come into force in July next, but which do not appear to be binding on flagships of States not a party to the international regulations under which schemes have been made? These ships are just as likely, some much more likely, as ships of the contracting parties, to be involved in collisions which could involve oil pollution.
I have asked a great many questions and I would not expect my noble friend necessarily to be in a position to answer them all; but except for the last one, they all come under the umbrella Question concerning the Ekofish experience and all are germane to the problems which are being studied by Her Majesty's Government and by the other Governments concerned with conditions in the North Sea. I am sure that any answers my noble friend can give will be read in many quarters with the greatest interest and attention. Fortunately, this incident has been nothing like as serious as it might have been. We do not know what the next incident might he and therefore to learn the lessons from Ekofisk is, we would all agree, extremely worthwhile.
7.41 p.m.
Lord STRATHCONA and MOUNT ROYAL: My Lords, predictably the noble Baroness, Lady White, used to good advantage the rather more ready availability of time in this House to raise this Question. She did so in an extremely comprehensive manner and some of us will be in a little difficulty to avoid repeating many of the questions she asked. I hope she gave the Minister a certain amount of notice of her questions, otherwise I suspect he will be in grave difficulty, because some of them were highly technical, particularly those outside his immediate Departmental interest. It may well be that this matter should be tackled by a series of Written Answers, but perhaps this is something that can go into a comprehensive report that we shall get about this incident in due time.
It is worth starting by making the point that we have known from the outset that the North Sea operations were on the frontiers of technology, and I think we can count ourselves as having been fortunate so far. Perhaps this is largely due to the cleverness of the extremely brilliant technicians who have been working there—we do not want to overlook what they have achieved in a remarkably short time—and in a sense we can draw a certain amount of encouragement and cautious confidence from what has happened. Nevertheless, as Lady White said, this has been a salutary warning to us against over-confidence and I hope we shall profit by studying what has happened and learn the lessons from it.
When does the Minister think a report is likely to be produced? After all, a comprehensive report in two years' time will, frankly, be far too late. We want something reasonably quickly, even if it is not totally comprehensive and complete. It is also probably true to say that it will be more interesting to know how we feel we reacted to the emergency than to have a complicated analysis, which I am sure many of us would not understand, as to exactly what the cause was, although I fully accept that the main emphasis in all our thinking about this sort of affair must be on precautionary measures to prevent it happening.
On the credit side, let us remember that only one well was affected in this case and, as Lady White said, there was
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no fire. Noble Lords may have seen on television the pictures of the platform on fire in the Gulf of Mexico, and there a large number of wells took fire. I understand that it is much less likely to occur now because there are downhole preventers which, in this particular instance, had already been removed so that the fishing operation could take place for the piece of equipment that had been lost.
We must remember, too, that we have the advantage of this being a light oil in turbulent waters, and from the narrow interest of this country I suppose that we must be grateful that we live in an area of prevailing south-westerly winds, although as a gardener I have become painfully aware in recent years that at just about this time of year we seem to get a great deal of easterly wind, and yesterday was perhaps an example of what we can expect. I am being thoroughly parochial in saying that because this would affect Britain more adversely than it would the countries on the other side of the North Sea.
We can take some encouragement, too, from the actual oil pollution figure; it was about 16,000 tons spread over about ten days and it is an interesting thought—I admit that I have not checked this with the experts—that, according to my understanding, if one has to drill a diversion well one is involved in about six weeks of work. It would appear likely, therefore, that even if one has to drill a diversion well, one is still involved with only the amount of oil that came out of the "Torrey Canyon" disaster. Goodness knows! that was bad enough, but we must try to keep a sense of proportion about these things. There is an important proviso about this to which I shall come later—and, of course, this is all on the assumption that the equipment to deal with such incidents is readily available when they happen.
I do not know whether the Minister will tell us what the statistical forecasts warn us is likely to occur. The noble Lord, Lord Ritchie-Calder, who will speak later, is something of a dab hand in this connection, so perhaps we shall hear more about it before the evening is out. It is clear that we shall have to deal with this kind of happening again. My impression is that the oil companies are taking the

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view that the difficulty about being adequately prepared to deal with every contingency is that there are so many different possible crises that could arise that it is very difficult to standardise one ship that is sufficiently comprehensively equipped to deal with all emergencies which can arise. One must therefore have a very wide range of equipment available.
Added to that is the fact that these fields are quite widely scattered over a considerable area, across the North Sea and it is obviously important to have emergency equipment quite near at hand when there is a disaster or potential disaster. We know that BP have the "Forties Kiwi", which I think cost them £3 million, and they have announced the possibility of building a further ship costing £20 million, so it is clear that the oil companies take an extremely serious view of their responsibilities in this matter.
I gather also that when this incident took place much more equipment was offered by the various companies than was used or was considered to be needed. What I am not clear about is what financial arrangement is made between the companies when this sort of incident occurs. If equipment is called up to stand by, is it paid for by the company responsible for operating the platform and, if it is used, is it then paid for by the company or its insurance company? Red Adair was called in this instance and I understand that he has a fixed fee, whereas the salvage tugs, which conceivably might be a comparable kind of organisation, normally work on a no-cure-no-pay basis. I am not sure which arrangement we think would be most satisfactory for the kind of thing that we foresee in the North Sea.
Here, I am in danger of sounding a little controversial, which I do not wish, but I felt that the Ministerial reaction to this episode was rather interesting. It did not seem that it showed a totally relaxed confidence in the contingency plan if the first thing that the Minister felt he had to do was to climb into an aeroplane and open up conversations with his opposite number in Norway. It may be that he felt he had to demonstrate public concern and show that he was doing something but, personally. I should have been happier if he had said, "All this has been
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foreseen. We know exactly what to do and we are now going to go ahead and do it". Similarly, it seems curious that he now announces that he is to set up a study group. Should we not have set up that study group two years ago when the whole operation first got under way?
Lord STONE: My Lords, would it not be advisable to get evidence of what research is needed? Also, was it not the events that stimulated the idea rather than having the whole thing in theory?
Lord STRATHCONA and MOUNT ROYAL: I accept that up to a point, my Lords, but I had been going to go on to say that we now hear that Red Adair is to be called in as a consultant. Although it may have been something of a sales pitch, Red Adair has been saying for a long time that something like this was going to happen. I should have thought that, if we had really been thinking forward properly, he should have been consulted long ago. Maybe he has been, in which case—
Lord PARRY: My Lords, I wonder whether the noble Lord would give way? It seems to me a pity that his speech is wandering into an area of discussion that should best be left at this point because constructive points have been made up till now which seemed extremely helpful. It is a pity that we are now entering into this argument when the whole expertise in the North Sea has been purchased in order that the techniques that have been practised elsewhere may be developed off our shores and, in the long run, be to the advantage of our economy. Red Adair was acting in an incident that was totally unexpected, and the expertise that he has gained elsewhere was equally brought in order to be of future use. It would be squandering that very expensive experience if we did not use it in the advisory committee that is to be set up.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I do not know that I follow the noble Lord. It seems to me that we have brought in this gentleman and have said that we intend to use him as a consultant in the future. He has said for a long time that this kind of thing would happen. If that is so, I really cannot understand why we did not—if, indeed, we did not—consult him a long

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time ago. I am not trying to be destructive but merely saying that it is perhaps salutary that we have been reminded that we have been remiss in our duty. Of course it is true that one has to say that that is the Government's responsibility.
I hope that the noble Lord will also take this opportunity to deal with the rather enigmatic Press reports which have been ascribed to the Minister and which have certainly been taken in some quarters as indicating that he is considering the possibility of making the expenses incurred in dealing with this type of situation not deductible for tax. I cannot believe that that could possibly be the case, but it is certainly an interpretation that has been put upon some of the Press reports that I have seen. Clearly, insurance and precautionary measures are desirable and must be considered as an oil company's operating expenses. We should indeed be working in the wrong direction if we did anything to prejudice that.
I was also struck by a point raised by the noble Baroness when she asked what practice crews were given. I wonder whether we might not go even further, and whether there is any mechanism for a joint Ministry/oil company system of exercises in dealing with major crises of this kind. Such crises will certainly occur again, and it seems to me that we could learn something if we staged a military type exercise to see how effective our measures were.
In that connection, I should also like to underline what the noble Baroness said about the importance of the communications system. How well did it work? Did we have any difficulty with non-compatibility of equipment, whether airborne, seaborne or company equipment as opposed to national telegraphic equipment? It is most important that we should have a net of compatible equipment so that everybody can be co-ordinated and can know what everybody else is doing. Here again, that equipment must be regularly exercised so that we are sure that it works when we need it. One knows that standby equipment is frequently neglected unless somebody is made to check it.
Can the noble Lord also tell us a little more about how the costing of this type of operation is carried out? I imagine that the oil company is responsible for
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the expenses of cleaning up the mess which it is responsible for making. Who assesses what has been the damage and what are the appropriate measures to take, and who decides what measures are demonstrably sensible but not extravagant? The noble Baroness asked what had been the total cost, and I suppose that I am asking how this is allocated.
That raises the further question of how the assessors and inspectors dealing with this kind of situation are trained. Have they yet had time to get any specialised training in this field? Can we be told of the progress of the discussions with the Norwegians? The noble Baroness spoke of the mechanical versus the chemical approach: is it a fact that the Norwegians still rely on skimmers and are still rejecting dispersants? Is it also true that we still look at it the other way round? And what evidence have both our countries for their particular point of view? I do not wish to try to indulge in a lot of technical stuff which we should in any case probably not understand. Should we not also he talking with the Danes, the Germans and the Swedes, all of whom are potential sufferers from this kind of episode, as well as the Norwegians?
Lord HALE: And the Dutch, my Lords.
Lord STRATHCONA and MOUNT ROYAL: Yes, my Lords. If we look much further ahead, although at the moment we have many support ships as well as drilling rigs on station in the North Sea, the time will come when a great deal of that equipment will have been dispersed and will have moved on somewhere else. Have we thought at all about how we are to be sure of having the equipment that we need when it becomes necessary later on?
To finish, I should like to return to my starting point by saying that this episode has demonstrated that there is no cause for panic. It seems that the plans worked well at a technical level, and I believe that we shall be interested to know whether the Government think that there is room for improvement before the next crisis hits us. We must not be surprised if it happens again, which it surely will.
7.59 p.m.
The Earl of KIMBERLEY: My Lords, I should like to congratulate the noble

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Baroness, particularly on some of the very penetrating questions which she has put to the noble Lord, Lord Strabolgi, this evening. I wish also to say how grateful, I am sure, are noble Lords in the House that this Question has been put; and the general public will be grateful, too. The Ekofisk incident, apart from any physical damage, has brought home to the public in no uncertain way the dangers of these problems. I believe that at a meeting between the Department of Energy and the United Kingdom Offshore Operators Association on 5th May, it was stated that, with the exception of one, all the vessels which were used were capable only of supplying large quantities of water to keep the platform cooled.
The noble Lord, Lord Strathcona and Mount Royal, said that it is very difficult to have the right kind of vessels everywhere at the right time, and I must agree with him, because there are so many types of trouble. But I am led to believe that there is only one specific anti-blow-out vessel under construction, and that has been commissioned by Phillips, although yesterday's Times reported that there were some informal talks taking place with BP about building a £25 million offshore maintenance safety and fire-fighting vessel. Should this go ahead I sincerely hope that it will be built by British shipyards.
In the report from the Department of the Environment last year, entitled Accidental Pollution of the Sea, it was stated, as has been said previously, that there is a 50/50 chance of a blow-out in the next five years, but I should think that the probability is that it will be less than five years. The report stated that the safety precautions were adequate. I am glad that the Secretary of State for Energy said the other day that he did not necessarily think that they were adequate, and it would be interesting if the noble Lord, Lord Strabolgi, could confirm this. Perhaps the Government could specify whether there are any new anti-pollution measures for when the next blow-out should occur. Would it not possibly be a sensible idea to have a conference of the oil-producing nations who operate in the North Sea area? I believe that such a conference could do three things. It could co-ordinate the monitoring of oil spillage, try to prepare an almost instantaneous reaction to deal with a blow-out
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wherever it may occur, and, lastly, possibly train a European "Red" Adair. On the BBC programme "The Energy File" the other day Mr. Adair said again that he did not think that the safety precautions in the North Sea were adequate, but, as I have said, it appears that the Government are inclined to agree with this.
So what have we learned? We need, if it is humanly possible, better and more adequate fire and anti-pollution precautions. But alas! no precautions will be 100 per cent. effective because blow-outs are usually the result of a human error. Therefore the optimum must be to provide measures to contain the disaster until the well can be killed. As the noble Baroness said, we are woefully behind in combating pollution at sea, so we must improve existing measures, together with the fire and blow-out preventive measures. I say this because a disaster like Ekofisk, small as it was, is international. Norway really needed outside help, and so would we if it were on one of our rigs. It would be no good saying that the artificial boundary line, such as the median line between the United Kingdom and Norway, is safe; that "it is your problem on your side, or our problem on this side".
In my very humble opinion the reason for the deficiency and lack of a lot of the right equipment is that it has never yet been clearly defined as to whose is the responsibility; whether it is that of the Government or of the oil companies. Neither can sit idly by waiting for something to happen, but so far, on the whole, neither has been prepared to undertake the necessary capital expenditure on the best possible offshore anti-blow-out equipment. The oil companies have no statutory obligations in this regard, except those which were granted licences in the last licensing round; and although some equipment and chemicals are available in Aberdeen and various other ports, very often they would probably be totally insufficient in a major emergency. Perhaps this could almost be termed as a public relations exercise, as it must be open to doubt how quickly and effectively the equipment could be brought to bear. I believe that recently a more substantial scheme has been started, known as OPOL (the Offshore Pollution Operators' Liability) which could be likened unto an insurance policy. But it is not yet fully

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implemented, and it is not supported by all the offshore operators, and I believe that the subscription to it is voluntary.
So to clarify the situation, we must try to determine whose is the responsibility in the event of a blow-out. If it is the operators' responsibility, it must be specifically defined and written into their licences. If this were done it would precipitate rapid action, which could be taken jointly, and some form of mandatory insurance. I do not think that the Government should leave the oil companies holding all the responsibility, because the Government take large fees and royalties and taxes, and some of this money should be allocated towards protective measures. Therefore, in practice the Government's responsibility could, in part, be exercised by BNOC, which has a 51 per cent. share in the existing production, and it would then bear its share pro rata of any measures and/or expenditure which would be required.
I have one slight doubt or feeling of unhappiness about this. Does BNOC have the technical ability? I ask this because, without wishing to denigrate it, I must say that it is a company which is directed by politicians and economists who may well not have the necessary expertise. Much more research must be done in clearing up the oil slicks, and this research can be improved. Here again, responsibility will have to be defined.
Lastly, there is the question of sabotage. Security has been taken to prevent sabotage, but it must be remembered that this threat is always present, and therefore the security must never be allowed to slacken off. The risk of sabotage is great, but probably a far greater risk is possible collision in poor visibility by ships, especially fishing vessels. It seems to me that the Government, unless they specify whose responsibility it is to provide equipment and take action in the event of a major blow-out, must be at fault. It is urgent that this be rectified, because there is bound to be a repetition of the Ekofisk incident, even if only because of the human element, and it could happen tonight or tomorrow.
8.7 p.m.
Lord RITCHIE-CALDER: My Lords, I follow the noble Earl, Lord Kimberley, in the ominous note on which he finished
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his speech. Is it not rather frightening to think that one man, "Red" Adair, stands between us and catastrophe? I applaud what he did in capping the blow-out in the Ekofisk field, but I would remind your Lordships that he is continuous, he is in demand all over the world. Why is he in continuous demand all over the world? It is because, as others have suggested, there are blow-outs onshore and offshore all over the world, and as things stand at the moment we will go on having blow-outs on and offshore all over the world. Whenever and wherever there is a blow-out, people say, "Get 'Red' Adair". I notice that my right honourable friend the Minister of State for Energy, Dr. Dickson Mabon, has invited "Red" Adair to advise the Government on how to cope speedily with emergencies like Ekofisk, if such a thing should occur in the British sector. I want to follow what the noble Earl, Lord Kimberley, said on this matter. Where are the other "Red" Adairs? Why do we not have them in this area? Why do the Americans not have them in various areas? He is practically unique.
Another matter, which is much more important, is the question of why a blowout should occur. Is it not really frightening that a valve should be installed the wrong way round? We have heard about inspection and so on, but this is almost primitive engineering that we are talking about. We talk about human error as though it were a legitimate excuse. There is no legitimate excuse for the kind of errors which can create the situations such as we have seen.
Remember, my Lords, that we are multiplying the risk of human error every day as the oil programme expands, and we are also magnifying the risk. The expertise of the oil industry is being spread extremely thinly, and risks are being taken with inexperienced so-called experts. For example, the death toll of divers in the North Sea grows every day. We find that many of them—and I speak as an expert in the British Sub-Aqua Club—are little better than amateurs, improperly trained and certainly, so far as I can gather, with very little insight into what they are doing except by specific instruction. They are willing, it is true, to risk their lives, but they are that amateurish that they are putting many more at risk.

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We are told that, undeterred by Ekofisk, the Norwegians are going ahead with plans to lay pipelines across the Norwegian Trench— that deep seabed which shears the Continental Shelf—but we should remember from our debate here on the future of the hydrography service that in the North Sea and around the Orkneys and Shetlands we are laying massive pipelines in areas which, in many instances, have been inadequately surveyed. If every half-mile has to be resurveyed, I hope they are doing it, because what we heard here disclosed a very disquieting picture in relation to what we know about the seabed in the areas in which they are laying the pipelines.
My Lords, we are pushing ahead with an oil programme on which, we are told, a geat deal, including the future solvency of Great Britain, depends. We are doing it considerably through oil companies which claim to have the expertise, but that expertise is only commensurate with the experience of the experts, and we have a right to ask: How expert are the experts? I think this has come through, with some disquiet, from the speeches of previous speakers. I do not think I am exaggerating when I say that, so far as the North Sea is concerned, much of what has been done—and I say this advisedly—has been improvisation. These giant platforms are only scaled-up versions of the kind of installations which have been employed in the Gulf of Mexico and in other shallow areas. I have no doubt that structurally they conform to the ready-reckoners of the civil and mechanical engineers, but the North Sea is one of the most storm-driven seas in the world. The engineers may be getting out of their depth. Obviously, the installations should not be standing on stilts or forming artificial islands: they should be encapsulated on the seabed. Then, my Lords, we are back where we started. How can we ensure that these unmanned, remote-controlled installations, which will come, will be safe, maintainable and repairable?
My Lords, my right honourable friend the Minister of State for Energy, speaking last Friday at the opening of the Department of Petroleum Engineering at Heriot Watt University, Edinburgh, insisted that we, the British, should be "the pioneering
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entrepreneurs of the oil industry", and went on to say:
"We intend that Britain should be firmly established in the oil business long after the last drop of North Sea oil is gone".
He was opening a pioneer department which provides facilities for 20—I repeat, 20—postgraduate petroleum engineering students at present on their master of engineering courses. My Lords, if we are going into the business we need many times more qualified people than that. I do not want to imply any disrespect to the universities and the technical colleges which are undertaking this, but I do say that we want to have a great deal more knowledge and insight than we either have or are giving them.
I would go further, much further, than my right honourable friend and say that we need an ocean industry in which we, Britain, should take the lead in another Industrial Revolution. An ocean industry would mean much more than oil exploitation. It would mean human effort on the seabed itself—a transfer to a new living environment, and not just, as at present, ad hoc recruiting and training of adventurous divers. It means, among other things, the regulated development of seabed minerals, the harnessing of energy from the sea and (and this is the point I am trying to make) not just oil drillings; that is to say, energy from oil drillings. We are now getting into wave-generated electricity, heat transfer systems and so forth. Above all—this, I think, is the lesson of Ekofisk, and I would warn anybody who ignores the warning that it will be serious consequentially—training for an ocean industry should lay paramount importance on the ecological and environmental safeguards. We cannot afford to take chances. The oceans are our last resort. We have been outrageously reckless and extravagant with our land resources. We cannot, we must not, mismanage our ocean resources through cynical commercialisation, whether in the petroleum industry or in seabed mining.
I am specially sensitive about this subject, my Lords. Nearly 10 years ago, as was referred to earlier, we had the "Torrey Canyon" situation. At the same time, or immediately after, I recall very vividly that I left a debate in your Lordships' House and I flew to California. A friend had given us a house right on the

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beach. We arrived after dark, and in the morning we pulled back our curtains to admire the beauties of the Santa Barbara channel and the offshore islands. We could not see out. The windows were smothered in oil spray from the incoming waves. This had been the night of the Santa Barbara blow-out—an earlier Ekofisk. From then on we had the torment of thousands of dying sea-birds before our very eyes and a beach on which we could not even walk because it was smothered deep in oil. I am not going to repeat that outrageous story in which the oil company had taken risks which a schoolgirl geologist could have foreseen. One would have thought that the lesson would have been learned, and yet 10 years later, and obviously with very little sense of what actually happened—I am sorry; it is true—we are now, in a different dimension and in different places, facing the kind of things that we are talking about here.
My Lords, we think of oil as polluted beaches, dead sea birds, and as the destruction of marine life. I would put it tonight in another dimension—no less than a threat to our continued existence, and not just in terms of recreational pleasure or of sea food. The ocean is part of that elaborate and balanced system which generates and regenerates our atmosphere. It is a source of oxygen indispensable to all life on earth. If we curtail that oxygen supply, we impair and ultimately destroy our means of respiration. Oil released from the vaults of millions of years ago is an intractable chemical. I am very grateful to my noble friend Lady White for her extremely interesting and differentiating account of the nature of the oils of the North Sea, but I would remind anyone here that it is an intractable chemical. We are told very glibly that, apart from decomposing it with detergents, nature will biodegrade it. But I would remind your Lordships that to biodegrade oil needs a great oxygenation process, using up the oxygen in nature. The extent of this process is still not fully understood, but that does not mean that we have to overlook it or pretend it is not there, because the implications are certain.
I was very interested, also, that my noble friend Lady White brought out this question of synergistics in relation to oil and other chemicals, because I would remind your Lordships that there is an
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unholy alliance in a strange way between oil and DDT. In the Mediterranean—and I wrote a book on the pollution of the Mediterranean—we found the trees of the Bourbon Forest in the Tyrenian coast had been destroyed because they had been enamelled, I repeat "enamelled", with a combination of oil and DDT which had stifled and smothered the leaves of the trees.
This is all part of the story of which we have no adequate or properly adequate information today. The implications go further: the implications of a film of oil spreading, as Thor Heyerdahl told us from his experience of raft-crossing the Atlantic, for thousands of square miles over the surface of the oceans. That layer can act like the filter of a camera and cut out the sun's rays which are necessary for the photosynthetic process in the upper waters where the phytoplankton and the zoo-plankton grow, not only to supply part of the food cycle but to release oxygen into the atmosphere.
My Lords, this is a very, very serious problem, which in the haste and hurry of our development of oil (for the imperative reasons which are always justified) we are at the moment, in the scientific and technological history, at least, only beginning to glimpse. But it is so important that—and I am not asking my noble friend on the Front Bench to answer this—among those who are concerned with this (in the multiplicity of Departments mentioned by my noble friend Lady White, which fills me with dismay) somebody, somewhere, somehow should be looking not just at the immediacies of the Ekofisk but the certainty—and I say this to the noble Earl, Lord Kimberley—of repetitions. It is not just what Red Adair has said: it is a mathematical certainty that the way things are going now we will have repetitions on a world scale. I cannot conceive of what would happen if we had a repetition in the North Sea of what happened in Saudi Arabia with a backflash fire through an entire oilfield. What would happen to Piper Field and all the others if we had that?
The noble Earl, Lord Kimberley, was asking who should share the responsibility. It is a Government responsibility. It is government by catastrophe when you must wait for something like this to

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happen before something is done about it. But, also, the burden of this responsibility must lie with those people who are on the job, doing the job, and with the experts and expertise that they are supposed to be able to muster. To the noble Earl, Lord Kimberley, I would say that I do not think that it was the chartered accountants and the civil servants who discovered the BP oilfield in Alaska. There was a good deal more expertise than there was bookkeeping or civil servants.
My Lords, the question is this. Who will deal with it? First, I put the responsibility squarely on the Government. It is their job to see that if we have not enough adequate experts—and 20 MSc's is not good enough for me—we should be encouraging and developing as quickly and as thoroughly as we can the kind of people who, as my noble friend Lady White suggested, will be standing at the elbows of the engineers to see that they know what it is that they are talking about in relation to these things.
Dr. Mabon, the other day, said that frankly we would hope to get more co-operation from the oil companies than we have had so far. If the Government, he said, had to make arrangements, then the oil companies would be charged; if compulsion is wanted then we have ample powers provided by Parliament—and the oil companies know it. This should not be a confrontation. Everybody's interests are at stake and I am going to stake a claim for the most important interest of all. It is that we are watching, in this situation of oil blow-outs, of tankers sinking, of the dumping of waste and of all the other forms of oil pollution, in our own time a tragedy which can put prosperity itself in hazard.
8.25 p.m.
Lord AUCKLAND: My Lords, it is a pity that this very important debate has to take place at a very late hour and in a thin House because I believe this is one of the most important topics that Parliament has discussed for a very long time. It is true that the question concerns a very narrow geographical area but, as has already been stated, it has implications for a very much larger area not only in this country but in many other countries.
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The nearest I have been to an oil rig is flying over one of the oil rigs in the North Sea in a helicopter on a fine summer's day. Possibly if some of us—and, indeed, Members of the other place—were able to visit an oil rig from time to time to see for ourselves what really happens it might be very educational for us; because it is a handicap to speak on a topic of this kind if one has not been on the scene.
It so happens that today's Financial Times carries an excellent supplement on Norway. There were two important points borne out about Ekofisk. First, the point already mentioned; that is, that the blow-out took place in fine weather. What might have happened had there been a gale, or if there had been an ignition of inflammable gases, was also mentioned as part of the supplement. It is not difficult to imagine what the consequences could have been. Also, it is perhaps cruelly ironic that, according to another part of the supplement, Norway's oil explorations are almost at a standstill now—not, one hopes, due entirely to Ekofisk, but because of the labour market. And this could have serious implications. The risks have already been mentioned and it is not difficult to envisage what could cause future disasters of this kind, because this very nearly was a disaster.
As one who works in the insurance market, I can tell your Lordships that there was a great deal of apprehension when this incident was reported. Had the worst happened, the insurance market could have had a crippling loss at a time when (as I mentioned in a debate yesterday) it is contributing vastly to our invisible exports. Of course, that is why insurance markets exist. This is a perfectly rational point. It could have had terrible consequences and there could have been heavy loss of life, as the noble Baroness, Lady White, mentioned. The effect on bird life could also have been dreadful. As it happened, according to reports which I have read, the loss of life among birds was mercifully small. There could have been a really major disaster.
The noble Lord, Lord Strabolgi, has had a surfeit of questions thrown at him, some of which no doubt he has been given notice, but others not. I should like to ask the noble Lord a question and I apologise for not giving him notice.

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I will understand if he is not able to answer it this evening. Section 6 of the Mineral Workings (Offshore Installations) Act 1971 imposes specific duties on inspectors regarding the safety aspect of oil rigs. Are the noble Lord and the Department of Energy satisfied that the Inspectorate are strong enough? This Act has now been operational, as I understnd it, since 1974. This is an important point.
The rupture of a platform by a trawl, an anchor or ramming by a vessel could easily cause a similar or worse disaster of the kind we have been discussing; and, of course, human nature being what it is, human error cannot always be avoided. Safety is all-important, and it is clear that one of the lessons which one hopes any Government must have learned from this blow-out, and previous blow-outs, is that existing legislation, such as the 1971 Act, must be looked at carefully and the terms of the Act enforced strongly. Parliament will need to debate a much wider measure than this in the future. As has already been said, there is little doubt that there will be further accidents of this kind. I will not pursue the question which has already been adequately pursued as to whether there are sufficient experts like Mr. Red Adair on hand if a serious blow-out occurs, whether it is in Scotland, Norway, or elsewhere. It is clear that if there is not expert help on hand and the weather is bad, and things are not in one's favour—and in Ekofisk they seem to have been—the worst could happen.
Anybody reading this debate may well say that this House is crying woe. That may be the case, but we are discussing an incident which could have been desperately serious. It is to be hoped, my Lords, that, as a result of this Question, the Government, oil companies and all concerned, will do all that is humanly possible if not to avoid another disaster of this kind then to minimise its effects.
8.35 p.m.
Lord HALE: My Lords, the noble Lord, Lord Auckland, called our attention to, I think, the financial section of The Times of this morning which I have not had the opportunity to see and probably shall not see, because I do not have occasion to read the financial pages of any newspaper. He referred to one of the points which is of serious anxiety to me: it is
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the way that this matter is being taken in Norway. We all know that Norway is a very ecologically conscious country and that the question of going into North Sea oil was a controversial one and is still a highly political one.
But here we have a blow-out disaster. Everybody agrees it has to be expected and has to be regarded to some extent as inevitable, though most of us believe that the new and elaborate blow-out controls provide a much greater measure of safety, and it may be that many of them do. We have a situation in which the Minister closes down the Ekofisk field the moment he has seen it. He says: "You must not apply the modern chemical detergents" if that is what they are—"because they will do more harm than good." The Phillips Company, in desperation, brought out a complete new drilling rig near the point of the disaster ready to bore new pipes by way of relief, an operation which would have taken 40 days.
Were they really expecting, or preparing for, the possibility of this going on for 40 days? What would go on for 40 days? The noble Baroness said this general type of oil, which varies in the North Sea, tends to be highly inflammable. In articles in the Press it has been suggested that if you really get a spark lighting up a blow-out, a gush of oil pouring out at immense speed and power into the sea, the spark might—and I hope it is not true—cause a fire. Presumably the immense heat could melt some of the adjoining contents and could set light to the whole of the well being served by that platform. This was Bravo 14; there are 15 wells going down an immense distance serving that platform. It is almost impossible to visualise what a fire like that could do and how far it could spread.
My Lords, before this incident, I was one of those who thought—not professing to know much about it but having taken a considerable interest in accidents and the sacrifice of life—that, so far as the North Sea Oil operation was concerned, which appeared to have been conducted with very considerable ability, in spite of grave danger of deep-sea diving, the work of an old friend of ours, Professor J. B. S. Haldane, among others, had gone very far to minimise the probability of loss of life. The additional provisions

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for rescue, the use of such things as undersea television and so on, going right down to the bottom of the pipe, were all providing considerable safeguards. I was one of those who would certainly have said then, and would probably say now, that in the absence of some catastrophic and unnecessary disaster, which could not be prevented in any of the operations of life, the loss of life from North Sea operations was not likely to be nearly as much as from the operations of half a dozen asbestos factories. I was certainly one of those who would have said that, ecologically speaking, the damage to be done by the Liberian Navy, sailing 2,000 ton vessels near our coast—vessels which are incapable of being navigated with safety or with accuracy—is likely to be much more disastrous.
The noble Baroness, Lady White, said that the Ekofisk site is perhaps the most convenient for such a disaster to take place, because it is so situated that it does not threaten immediate damage to any coast—although the Norwegians may rather think they would have preferred a slightly different one—and, of course, the "Torrey Canyon" was pouring out immense quantities of very heavy, very viscous and highly damaging oil, 16 miles from the coast. But in fact, apart from this inflammability, most of the North Sea types of oil have some considerable advantages in this connection and, indeed, in the Claymore and Piper fields of the Occidental Oil Company which I visited, the viscosity of the North Sea oil is stated to be less than that of sea water. This, of course, can result in increased energy coming from the less viscous oil through the mud; but, generally speaking, it can be handled fairly easily.
My Lords, my only previous experience of oil-getting was at Maracaibo, and although that is immensely useful and immensely profitable, it is really a series of comparatively small derricks in what is almost an inland water. When I went to Claymore, we came down on a drilling rig —the Ocean Victory—a tiny spot, looking down from the helicopter. It looks very small until you get to it and then it turns out to be rather bigger than a 23-storey building with a considerable area and an immense degree of technical provisions for communications, with an office and a
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computer, which was then employing about 70 men with fairly ample accommodation.
I took some pains to check up as far as I could, with my limited knowledge, on the provisions. There were two blow-out containers, both sub-sea, because it was a drilling machine: one with a resistance up to 2,000 pounds per square inch and another with a resistance of 10,000 pounds per square inch. The figure of pressure quoted in the many, varying and different accounts of the Norwegian water explosion was, I think, 3,500. There is to be an investigation, and one hopes that more facts will come out. Once this is done, and once the Norwegian Government have taken this grave view of the situation and once they have, as the noble Lord said, as reported, come to the conclusion that this is a major disaster for Norway, and not only politically—well, one has got to have a look again.
There is the Occidental Company, the Thomson Company and the Getty Company—which have united to finance the Ocean Victory operation. The Ocean Victory was costing 50,000 dollars a day to run. It had been boring, I think, for two and a half years at the end of its stay, and made only two finds, one of which was regarded as a substantial prospect and the other is just about good enough. Fortunately, it was made good enough by the fact that it could be served by the same oil terminal.
The other strange and worrying thing was that they were prepared to build an immense "reaping" platform with 24 wells, I think; and they have laid down 137 miles—my Lords, I fear that I am taking up too much time—of tube. I ought, to do justice, say this. So far as Flotta is concerned, I saw the opening from a comfortable armchair at the Dorchester Hotel on film, with speeches and so on. It may be said that the provision of Flotta for the containing of 500,000-gallon tanks its their services, which will employ 100 Orcadians among the 160 workers, and so on, is good publicity.
All those things were fought by the Government; they were fought by the Ornithological Association; they were the result of long discussions. They have given, we are told, great satisfaction in Orkney. Their industries are being developed, and Orkney is to have its art

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gallery containing the famous pieces of the well-known Margaret Stuart, who has been living there for some years and has offered to give her pictures. Also, the legendary Mr. Arnold Hammer, who used to be a friend of Lenin, is building a theatre, and so on. It is good publicity. It is very convincing, too. I am quite sure that my noble friend will give all the information that he can.
What I meant was that they did not speculate about this or that. I have a set of illustrated booklets issued by Occidental. I have not been a friend in the past to big companies, and I am not a friend now. I do not know them from Adam, except in two senses. But the booklets are impressive. They show the construction, the siting of the end of the 30-inch pipe, with its immense capacity, the wells, the refinement and the provisions in every way for dealing with the ecological problems. It is an impressive document and they are entitled to the credit. Of course, this is a very well-financed operation.
I agree in every way, in view of the attitude of the Norwegian Government, in view of some of the descriptions that are given, in view of the allegation of a valve being fitted upside down—which I think is quite impossible—or a faulty blow-out container, that all of this is subject to argument in the various camps. We want a lot of information. But this operation has started and it will not be stopped, in view of the immense amount of capital now invested. What we can concentrate on doing is seeing that all possible steps are taken, and I am quite sure that my noble friend Lord Strabolgi will give assurances that that is being done.
8.53 p.m.
Lord STRABOLGI: My Lords, this is a very important matter, and I think that we have had a notable debate. I am very glad that my noble friend Lady White put down her Unstarred Question and I have listened with great interest to the speeches made, demonstrating as they do the concern we all feel about the actual effects of the Ekofisk blow-out, because this Question is about Ekofisk and its lessons and the potential problems that any future blow-out might cause.
Before dealing with the various points raised—and I am grateful to my noble friend Lady White for giving me notice of
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some of the questions that she would ask—I should like to make a few general points. It might help, first, if I tell the House what seems to have happened at Ekofisk Bravo which, as your Lordships know, is part of the Norwegian Ekofisk oilfield. Late on Friday evening, 22nd April, a routine operation on well maintenance went wrong, when the mud which was in the well started to flow. Immediate attempts to stem the flow were unsuccessful and, of course, a blow-out ensued. The cause of the blow-out has not yet been established with any degree of certainty. The Norwegian Government have announced the setting up of an independent judicial inquiry to establish the facts, and we all await the outcome.
Before describing what the Government are doing in the meantime, I should like to say in answer to the noble Lord, Lord Strathcona, whose very constructive speech I greatly welcome, that our own full report will depend upon the progress of the Norwegian inquiry, and we do not yet know when the results will be made available to us. Although the blow-out occurred on the Norwegian Continental Shelf, all North Sea States are, of course, involved in the effects of the pollution and concerned about the measures taken, both to minimise the pollution and to deal with the capping of the well. The Secretary of State for Energy flew to Norway and, as near as flying restrictions would allow, around the Ekofisk oilfield. My right honourable friend discussed with the Norwegian Minister of industry the steps being taken to control the well and the pollution, and he confirmed the offers of United Kingdom assistance.
My noble friend Lady White—rather surprisingly, I thought—asked in a rather dubious tone, if she will allow me to say so, how seriously the Government are taking this matter. On the other hand, was chided by the noble Lord, Lord Strathcona who mentioned the fact that my right honourable friend had immediately flown over to Norway. So that, between the two of them, I hope that I have managed to convince your Lordships that the Government take this incident very seriously indeed. I think that your Lordships' House has not had the benefit of the log which has been placed in the Library of another place and I will, if your Lordships wish, see that that is put

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in your Lordships' Library. Your Lordships will see the very instant action that was taken, showing how very seriously we take these matters.
Tribute has been paid, and rightly so, to Mr. Red Adair and his team from Redco, and I should like to join in this. The working conditions for those bravemen who took on the job of capping the well, having flown in at very short notice from Texas, were hazardous and uncomfortable. Hot oil was pouring out from the well and explosive gas concentrations were present. The job itself is difficult and the risks high. However, as we all know, Mr. Adair and his team were successful—happily for all of us concerned about the possibility of two or three months of continued oil pollution, if the capping had failed.
During the following week, Her Majesty's Government set up an interdepartmental study group to evaluate departmental responses to Ekofisk, and the implications for our national interests offshore, including fisheries. Of course, this is not the first time that this has been done, as I thought the noble Lord, Lord Strathcona, implied. A study group had been in existence for over a year looking at the oil pollution hazards to United Kingdom waters. The Pollution Hazard at Sea Exercise, which reported its findings in Pollution Paper No. 8 last August and the information on blow-outs, was based on United States experience. The study group just set up can now look at the real blow-out, and see what additional lessons are to be learned from what is in many ways rather a new field. The special group, set up after Ekofisk, completed its first task a week later when it published on 6th May a log of the responses by the various Departments concerned. This showed that the Departments involved reacted promptly and effectively, activating the necessary contingency plans and offering a wide range of help to the Norwegian Government.
The second part of the study group's task, to review our response to any incident, is still under way. My right honourable friend the Secretary of State for Energy has already had two meetings with the United Kingdom Offshore Operators' Association, resulting in the formation of joint industry/Government
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groups to examine, in particular, the following matters: first, the provision of fire-fighting and emergency vessels. The Ekofisk blow-out has focused attention on the need for capable vessels to provide a supply of water for fire-fighting or cooling purposes, as well as providing a working platform with suitable crane facilities for lifting heavy gear. In the United Kingdom sector, three operators provide vessels with monitors capable of cooling a platform, as was done on Ekofisk, and four more are now being provided. The working group will consider this issue in some detail and recommend the type of vessel and facilities required.
Then there is the question of drilling and production well control. The procedures commonly adopted for controlling oil wells will be reviewed to see whether a common practice needs to be set down and if improvements can be achieved. There is also the question of the oil spill clean-up. The major issue here is what role, if any, skimmers and booms have in assistance such as that planned in the United Kingdom, based on the use of dispersants. I shall have a little more to say later about dispersants versus the containment and recovery which was alluded to by my noble friend Lady White.
The bulk of the equipment deployed to clean up the oil released at Ekofisk consisted of booms and skimmers. The Norwegian authorities permitted the use of dispersants only in the immediate neighbourhood of the platform, to minimise the fire risk. Several skimmers with a claimed capacity of 8,000 tons a day were sent out to Ekofisk by the operators and the Norwegian Government. The operators were able to deploy only two at any one time. Very little oil was collected during the first few days when the skimmers were used. However, there were indications towards the latter end of the clean-up operation that significant amounts of oil were being collected. The improved performance is attributed to favourable weather and experience in operation. A total of 800 tons of oil was collected over a seven day period, and 1,100 tons were estimated to have been dispersed by the limited spraying activity. Once the well had been capped, the size of the main slick rapidly shrank. Some three days after the flow

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had ceased, the oil had spread to such a thin layer that the skimming operations were abandoned. Throughout the clean-up operation and afterwards the position of the slick was monitored by Norwegian ships and aircraft as well as by an American space satellite.
The Norwegians prefer the use of mechanical means, such as booms and skimmers, and at Ekofisk they tried out a number of pieces of equipment. The performance was not such as to convince our observers that the equipment was fully effective. It may be, however, that the use of a combination of a mechanical system, together with dispersants for the amount of oil and type of slick caused by a blow-out, might be successful. The Warren Spring Laboratory is currently carrying out a programme to evaluate these different methods. The Warren Spring vessel "Seaspring" carried out some promising trials with one such system in the Ekofisk spill. The results obtained with the equipment used and tested at Ekofisk will be closely examined by the groups assessing the requirements for dealing with any spill in United Kingdom waters.
The Government agree in principle that the removal of oil from the sea is to be preferred to dispersion of the oil by chemicals. However, a reliable containment and recovery system for the turbulent waters of the North Sea is yet to he proved. Hence the reliance on dispersion, both by the Department of Trade and the industry. Much is said about the toxicity of dispersant chemicals. Those in current use are much less toxic then those used at the time of the "Torrey Canyon" disaster, which has been referred to by several noble Lords today. Warren Spring have established by full-scale experiment that dilution of the chemicals into the water column is extremely rapid. Recently a new form of concentrate dispersant was developed which is dilutable in the ratio 1:10 with sea water at the time of application. The amount carried by a vessel of this type is therefore ten times as much as conventional dispersant and is, therefore, particularly attractive to operators at a great distance from the shore.
My noble friend Lady White asked a number of questions, and I think that at this point I should perhaps try to answer
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some of them. I will answer others later. My noble friend asked me first of all about the cost of Ekofisk. So far as it is known, the cost is about 10 million dollars. My noble friend also asked me about pipelines. The Department of Energy require that pipelines should be tested and inspected when laid and should be regularly inspected during their life. These include inspection by mini-submarine. Cathodic protection is applied to all pipelines and is monitored. World experience is that, provided this is done, the chances of leakage from pipelines are minimal. Even if a leak should occur, instrumentation on the pipeline would result in the pumping being stopped, and the amount leaked would be small.
My noble friend also raised the very interesting question of offshore installation communications. The position is that there are statutory requirements upon installations, under the Offshore Operational, Safety. Health and Welfare Regulations, and the Offshore Installations Emergency Procedures Regulations, to have appropriate communications with land, vessels and helicopters, and these regulations are enforced by the Petroleum Engineering Inspectorate of the Department of Energy. My noble friend also asked whether we have a guide to advise on treatment strategy to take into account. There is no universal guide. However, much of the information is readily available. The individual operators know the characteristics of their crude and the fishery interests around their platforms. NCC advice is also taken into account.
Many of the North Sea crudes are similar to Ekofisk. Warren Spring have carried out a number of sea trials with this crude and found that the spill from the blow-out behaved broadly as would have been expected from their trials. Further trials are planned with other crudes. The existence and availability of a viable clean-up method is regarded as an essential part of any oil spill contingency plan.
My noble friend also raised the question of superannuated tankers for use with pick-up equipment, but it appears to us that the principal problem to be overcome is the collection of oil from the surface of the sea rather than its treatment once it is aboard the ship. This is something that is being considered. Then my noble

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friend asked what measures the Government propose in order to improve the inspection of oil platforms. Inspection is one of the topics that will be looked at by the study group set up to learn the Ekofisk lessons. There are currently regular inspections by petroleum, mechanical, electrical and structural engineers and regular checks on the quality of the discharges and production and displacement of water.
I should like now to say something about the anticipated effects of a blowout on the environment and the steps that have been taken by the Government to assess what actually happened in the sea around Ekofisk. The principal effects were of course expected to be on fisheries, marine life, sea birds and, if the oil persisted on the surface of the sea, rocks and beaches. The marine organisms most at risk from spilled oil are those at, or very close to, the sea surface. In the Ekofisk area this means, essentially, the eggs and larvae of mackerel. The mackerel spawning starts about now and reaches its peak in July. However, the possibility of damage must be put in perspective; spawning takes place over a huge area and even if damaging concentrations of oil had persistently been discharged it would have affected only a small fraction of this area. As it is, because the slick has diminished, the overall effect on fisheries, compared with natural mortality and deaths resulting from fishing activities themselves, will be negligible. In relation to wild life, a number of factors prevented serious damage to sea birds and pollution of ecologically sensitive coasts, in particular: the small number of birds present in the area at the time; the weather conditions, which kept the oil in the central part of the North Sea, and the rapidity with which the oil evaporated and dispersed naturally.
If the oil had been of a heavier grade of a more persistent character, or had the incident involving Ekofisk oil occurred at another time of the year, for example, when young flightless auks, together with their moulting and flightless parents, were migrating across the open sea, oil left on the sea surface would undoubtedly have posed a serious threat and, untreated, could have led to serious bird mortality. The Nature Conservancy Council, who
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sent a task force to Norway, are studying the incident in depth to reassess the priorities required within programmes of research on sea bird ecology and to review the wild life contingency planning, particularly in relation to international co-operation.
During the week of the blow-out and the one following, three Government research vessels also went to the area. The two fisheries vessels, the "Correla" and the "Explorer", undertook a programme of sampling and fish collection in collaboration with two Norwegian vessels. The Warren Spring ship "Seaspring" went to study what happended to the slick and to try out a promising oil collection method. A Nature Conservancy Council ornithologist who had been lent by the Royal Society for the Protection of Birds was aboard "Seaspring" throughout and confirmed, as experts had predicted, that few birds would be affected on this occasion. Many samples were taken by each of the vessels and those samples are currently being analysed. I think it is too early to make firm statements but there are strong signs that the overall impact will be slight, due to the high rates of dissipation of oil through evaporation and the action of sea and weather.
My noble friend asked a question as to whether too little is known of bird habits while at sea. It is clear that there is a very detailed knowledge of the distribution of birds around our shores, and I know the great interest that my noble friend takes in these matters, while information on birds at sea is very sketchy. This information is necessary if the Nature Conservancy Council is adequately to advise on the threat to birds posed by a spill in a particular area, and I can assure my noble friend that this is being studied.
Much has been said about the cost of any incident. This point was mentioned by the noble Lord, Lord Strathcona and Mount Royal, the noble Earl, Lord Kimberley, and by my noble friend Lord Ritchie-Calder; and the question was asked: Who foots the bill? The operator would be liable for the clean-up costs and for any damage that may have resulted from the incident. Some of these costs may be covered by insurance; other operating costs incurred may not be and so will affect his liability. There is of course

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the question of corporation tax and whether that can be offset against the costs. These are important questions which are being considered by the Government, but I must stress that the initial responsibility is that of the operator. In fact it is written in his initial licence that he must take all steps to prevent damage to the environment and to the sea through any spill-outs of this kind. But, of course, as my noble friend Lord Ritchie-Calder has said, there is cooperation between the Government and the operators, and the Government are doing all they can to advise and help; but they require operators to submit contingency plans as soon as possible on what steps they wish to take and intend to take.
Lord STRATHCONA and MOUNT ROYAL: My Lords, may I pursue this for one moment with the noble Lord, because I think it is rather an important matter. As I understand it, he is saying that there is some doubt as to whether these costs would be deductible before paying corporation tax. That seems a very odd situation, because surely these are operating costs which would normally be taken before any tax liability would occur. He is really confirming the doubts which have been sown in some people's minds by Press reports. I do not think we can very well deal with this matter tonight, but I would be most grateful if the noble Lord could write to us, because I believe it is very important.
Lord STRABOLGI: My Lords, what I can say quite categorically is that the responsibility falls on the operators. It does not fall on the general Exchequer; it falls on the operators for any clean up operation. They, of course, will seek to cover themselves by insurance and will recover their costs in that way. Whether they will be able to offset this against tax is not something on which I should like to pronounce. All I can say, and all I did say earlier, was that all these matters were being considered between the Government and the operators. I cannot, I think, be fairer than that. But there is also, of course, the present compensation scheme drawn up and operated by the offshore industry, known as OPEL, which will eventually be replaced by an international convention concluded in December 1976.
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My noble friend Lady White asked me a number of questions. She asked what measures are contemplated to improve monitoring of offshore-related and ship-generated pollution incidents. Facilities for aerial surveillance are already an essential feature of the Department of Trade's plans, and will be a compulsory ingredient of operators' plans. Infra-red techniques would appear to offer promise for following oil spills. Warren Springs again are actively interested in this technique. The Government are co-operating in oil spill clean-up with the French authorities, who are also interested in this method of following slicks.
My noble friend also asked whether there is a central register of oil spills. The Department of Trade collect reports of slicks derived from coastguard reports, from military and civil ships and aircraft. With regard to the Bonn agreement of 1969, at a recent meeting in Hamburg of officials from the eight North Sea States it was established that all the States will regard the agreement as applying to spills from offshore installations as well as from ships. The timing of the next official meeting will be discussed when Ministers of the North Sea States meet in Oslo in June.
My noble friend also asked about collisions at sea. The vast majority of shipping will be subject to the 1972 Collision Regulations when they come into force. Observed violations of the traffic separation scheme in these international waters would be reported to the Flag State for appropriate action, whether or not that State is a party to the regulations.
My Lords, I think I can say in conclusion that the Ekofisk blow-out has provided a reminder that offshore oil production is a potentially dangerous business. While the human element remains, the possibility of further such incidents occurring cannot be eliminated. The importance of the training and supervision of the people on the spot, as has been mentioned in this debate, cannot be over-emphasised.
We can, I think, take encouragement from the fact that nobody was hurt in the evacuation operation and that the initial indications are that there will be little

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impact on the environment. But perhaps they were lucky this time; in fact, we were all lucky. The picture may not have been the same had there been a fire or had the incident occurred in an area where there were high concentrations of bird life.
The initial indications are that most of the mechanical clean-up equipment employed did not work well. The United Kingdom appears right at this stage to place its major emphasis on dispersion for oil spill clean-up, provided that the environmental interests are fully consulted on when to utilise this. The Secretary of State for Energy is taking all steps—and I stress all steps—to identify what further measures can be taken to prevent such an incident occurring on the United Kingdom Continental Shelf. He will examine, along with the Secretary of State for Trade and also, as has been announced, possibly with Mr. Red Adair—the world's greatest expert—and of course the industry, its capability to respond, should a blow-out nevertheless occur.

SPEAKER OF THE HOUSE
The LORD CHANCELLOR The LORD CHANCELLOR acquainted the House that Her Majesty had (by Commission) revoked certain Letters Patent and had appointed the Chairman of Committees for the time being, the Earl of Listowel, the Earl St. Aldwyn, the Lord Airedale, the Lord Douglas of Barloch, the Lord Strang, the Baroness Wootton of Abinger, the Viscount Dilhorne, the Lord Champion, the Earl of Shannon, the Lord Derwent, the Lord Henley, the Lord Gardiner, the Viscount Hood, the Lord Alport, the Lord Maybray-King, the Lord Hailsham of Saint Marylebone, the Baroness Llewelyn-Davies of Hastoe, the Lord Nugent of Guildford, the Lord Segal, the Baroness Tweedsmuir of Belhelvie, the Lord Amherst of Hackney, the Earl of Cathcart, the Lord Jacques, and the Lord Wigoder, Speakers of the House in the absence of the Lord Chancellor. The said Commission was read.
House adjourned at twenty minutes past nine o'clock.