Lords Sitting of 12 December 1979

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

THE POLICE SERVICE: LOCAL ADMINISTRATION
Lord SEFTON of GARSTON: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will give an assurance that it is not their intention to weaken any further the involvement of democratic local government in the control and administration of the police services, and whether they will state categorically that they are opposed to a centralised national police force.
The PARLIAMENTARY UNDERSECRETARY of STATE, HOME OFFICE (Lord Belstead): My Lords, the Government have no plans to change the statutory basis under which police forces are maintained. In particular, the Government have no intention of setting up a national police force.
Lord SEFTON of GARSTON: My Lords, while thanking the Minister for that Answer, may I press him a little further, because I am sure he will agree that some concern is being expressed in local authorities throughout the country, particularly in the North-West and North-East, about statements being made in the official side of the Police Service? Would he agree to enter into discussions with local authorities to restore some of the confidence of local authority members in the present administration of the Police Service?
Lord BELSTEAD: My Lords, we are always ready to talk to local authorities, and indeed the machinery is there for my right honourable friend to do that.
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Whereas chief officers have the direction and control of their forces, police authorities are primarily statutorily responsible for maintaining an adequate and efficient force for their area. That is a weighty responsibility and, I reiterate to the noble Lord, one which the Government have no intention of changing.

NORTHERN IRELAND: HOUSING
2.38 p.m.
Lord HYLTON: 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 plans they have for making the Northern Ireland Housing Executive more responsive to the housing needs of the people.
The PARLIAMENTARY UNDERSECRETARY of STATE, NORTHERN IRELAND OFFICE (Lord Elton): My Lords, the Government are encouraging the Housing Executive to complete its internal reorganisation which will help improve the services it provides for the people of Northern Ireland. The Government have also indicated to the executive the priorities which it should follow; these include giving greater emphasis to the management and maintenance of its existing houses. For the last couple of years it has been involved in a major reorganisation based on devolving responsibility on six regional controllers. These controllers have already been appointed and their supporting staff are now being allocated. It will, however, be some months yet before regionalisation is complete.
Lord HYLTON: My Lords, I am grateful to my noble friend for that quite full reply. While I would not wish to complicate the reorganisation which he mentioned, may I ask whether he would consider giving some role to district councils to act as a channel for grievances, for suggestions even, from the people to the Housing Executive and in relation to individual district or area offices?
Lord ELTON: My Lords, I am grateful to my noble friend for giving me an indication of the direction of his supplementary and I can tell him that the 26 district councils each has a representative on the Northern Ireland Housing Council, which advises the Housing Executive and makes representations on behalf of the district councils. The council also nominates three of the members of the Housing Executive's hoard. The Commissioner for Complaints has responsibility for investigating complaints against the Housing Executive and it is open to any local councillor to approach a district office of the executive directly. I understand that the executive encourages such contacts. I doubt, therefore, that a further formal channel would be useful or indeed necessary.
Lord HYLTON: My Lords, again I am grateful to my noble friend for those remarks, but may I ask whether the Government will give some publicity to the arrangements which he just outlined so they can be known rather more widely than they perhaps are at present?
Lord ELTON: My Lords, I am sure the noble Lord's intervention will have that effect in part, and I will pass his views on to my honourable friend in another place as to publicising the matter further. I think it is worth noting that the executive has made commendable progress in the face of the most difficult housing problems in the whole of the United Kingdom. Many of its problems arise from the legacy of the former authorities and of the years of civil disturbance.
Lord DUNLEATH: My Lords, does the Minister not agree that the main reasons why the Housing Executive is not held in higher esteem by the public is its failure to have built more houses in areas where they are desperately needed, the fact that it has not brought up to modern standards a greater proportion of old housing stock, and the delays which occur in carrying out essential repairs? Will he further accept my assurance that I have always found the local officials of the Housing Executive to be extremely helpful and prompt in answering inquiries?
Lord ELTON: I am glad to accept the noble Lord's assurance on the latter
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point, my Lords. On the former, I think it worth mentioning that the Housing Executive's programme has increased from 250 million in the current year to 300 million in 1980–81 and that, for the first time, more money will be spent on maintenance than on new building, yet the figure provided for building itself will have increased. It is a good programme and noble Lords will wish to welcome it and expect that the reorganisation which it is now undergoing will also meet the points the noble Lord raised.

POTATOES: EEC REGULATION
2.42 p.m.
Lord GISBOROUGH: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will give an assurance that in the negotiations about a regulation for potatoes in the EEC they would refuse to accept any proposals that did not provide benefits to the British producer and consumer equivalent to those they enjoy at present.
The MINISTER of STATE, MINISTRY of AGRICULTURE, FISHERIES and FOOD (Earl Ferrers): My Lords, the Government believe that any EEC potato regime must include adequate provision for supporting our maincrop potato market in times of heavy surplus so as to safeguard the position of producers and consumers.
Lord GISBOROUGH: My Lords, I thank the Minister for that Answer. Does he agree that the EEC member countries must retain their option to adapt their marketing systems to the very individual conditions and aims of their individual potato production?
Earl FERRERS: My Lords, we accept that it is quite possible that there eventually will be an EEC regime, although not necessarily in a form exactly like other commodity regimes, and we would certainly wish to make sure that any potato regime provides the right conditions for the potato industry in this country.
The Earl of KIMBERLEY: My Lords, can my noble friend say that there is no possible danger, as there once was, that the Common Market is to get rid of the King Edward?
Earl FERRERS: My Lords, I always am very loathe ever to suggest that there are no possible conceivable circumstances under which anything may happen.
The Earl of CORK and ORRERY: My Lords, is my noble friend prepared to comment on the Government's view on the joint National Farmers' Union-Potato Marketing Board potato working party proposals and to say whether they may find a deal with the EEC broadly in line with them?
Earl FERRERS: My Lords, the Government are continuing discussions with the producer interests, on the basis of the NFU-Potato Marketing Board proposals, about the possible form of a future stabilisation scheme. We have also argued strongly in Brussels for inclusion in an EEC regime of provisions enabling producer organisations to implement stabilisation schemes of this kind. These negotiations are continuing, and I am hopeful that a satisfactory solution will eventually be found.

HEATHROW AIRPORT: PROPOSED FOURTH TERMINAL
2.44 p.m.
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 when they received the report of the public inquiry into the fourth terminal at Heathrow; what was the cost to public funds of holding this inquiry; what is recommended in the report; whether and when they will publish the report; and when they will announce the Government's decision on the fourth terminal.
Lord TREFGARNE: My Lords, may I apologise in advance to your Lordships for the fact that this Answer is a little longer than usual. The inspector's re-
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port was received on 18th May, 1979. It will be published at the same time as the Government's decision on the fourth terminal, which will be announced once my right honourable friends the Secretaries of State for the Environment and for Trade have finished their consideration of the report. Until then it would be inappropriate to state what the inspector has recommended. The identifiable cost of the inquiry to public funds was about £62,000, but this excludes the cost of the secretariat and other costs inextricably bound up with the normal work of the Department of the Environment. It also excludes the cost of printing the inspector's report which Her Majesty's Stationery Office hopes to recover from sales. The attempt to work out the precise cost would involve considerable time and expense.
Lord BOYD-CARPENTER: My Lords, in thanking my noble friend for that very comprehensive reply, may I ask him two questions? The first is whether, in view of the grave and deteriorating situation at Heathrow, he can explain why so long a time—seven months, if my mathematics are right—has elapsed since the report was received without any public action being taken on it? Secondly, in view of the urgency of the situation, can my noble friend now give any indication of the earliest date by which this terminal could be completed in order to help cope with the situation?
Lord TREFGARNE: My Lords, in answer to the first point put by my noble friend, as I have said, the decision is one that has to be taken jointly by my right honourable friends the Secretaries of State for the Environment and for Trade, and there are a number of important and difficult issues which have deserved, and have received, careful study. As for the point as to when the terminal could be finished, that depends of course on what my right honourable friends decide with regard to the inquiry which has just taken place; but if they agree to allow the terminal, it will be ready by about the middle of the 1980s.
Lord BOYD-CARPENTER: My Lords, can my noble friend confirm—as I believe he can from his own experience—that this is now a very urgent matter? Can he also indicate that seven months is not the normal time required to procure

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agreement among two of his right honourable friends?
Lord TREFGARNE: My Lords, the matters were very complicated and very involved. I wish that the decision could have been taken earlier, but, having seen all the papers on the matter, I am quite satisfied that my two right honourable friends have not been unduly long, and I think that I can assure my noble friend that he will not have to be patient for very much longer.
Baroness BURTON of COVENTRY: My Lords, while understanding that the Minister is not able to say in advance what the recommendations will be, and bearing in mind that, as he himself has just said, he has seen all the papers concerned, may I ask whether he would feel able to tell the House if the question of access is considered in the report, particularly for those people with luggage who are dependent on public transport?
Lord TREFGARNE: Yes, my Lords; the report is fully comprehensive. All the points to which the noble Baroness refers are considered and will be taken into consideration by my right honourable friends.
The Earl of KINNOULL: My Lords, can my noble friend advise us whether the British Airports Authority have power to have given themselves permission for a fourth terminal, without a public inquiry?
Lord TREFGARNE: No, my Lords.

GOVERNMENT STATEMENTS
Lord DENHAM: My Lords, with the leave of the House, at a convenient moment after 3.30 this afternoon my noble friend Lord Ferrers will repeat a Statement being made in another place on the Council of Ministers (Agriculture). This will be followed by my noble friend Lord Trenchard, who will repeat a Statement on Post Office industrial democracy.

THE RESERVE FORCES
2.48 p.m.
Lord GLENARTHUR Lord GLENARTHUR rose to call attention to the need to maintain effective Reserve Forces; and to move for Papers.
The noble Lord said: My Lords, I must first declare an interest. I left the Regular Army just over four years ago and since then have been a member of the Territorial Army as an individual reserve for my regiment, and I train with them for 19 days every year. I can find no record of a full debate on the Reserves in this House in recent years, but since the mid-'sixties the role of the Reserves has become an increasingly important one.
The complete organisation of our defence effort has been adapted in line with what we can afford, what is appropriate in the context of our commitment to NATO, and the threat which we perceive. Each of the three Services depends to a greater or lesser extent not only on individual reinforcements which bring them up to strength on mobilisation, but also on units of trained volunteers who complete the order of battle. I am therefore encouraged by the number of noble Lords who have put their names down to speak on this important subject. Many have considerable experience of the Reserves, some from the highest military offices in the land. By my calculations, my Lords, with so many to speak it gives us about 10 minutes each.
The main purpose of the Reserves, as I have said, is to complete our commitment to our allies in NATO and to assist in maintaining a secure United Kingdom base. Broadly speaking, there are two types of Reserve: first, the Regular Reserve, which consists of men and women who have completed a period of regular service and who have to undergo a compulsory period of reserve commitment; and, second, what I shall call the trained Reserve. The trained Reserve is composed of both ex-regular Servicemen and civilians of no previous military background who have volunteered to train regularly in a particular Service, and who generally make up complete Reserve units or ships' companies, but who may in certain circumstances be an individual Reserve, such as I am myself.
The threat against which both Regular and Reserve forces are available to be deployed has changed considerably over the years. I suppose it is just conceivable that 15 years ago it could possibly have been argued by the Soviets that their military effort was defensive. My Lords, their ability now ranges from the defensive

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to what, in an ever-increasing way, is patently and overtly offensive in character and capability. The huge superiority of Soviet and Warsaw Pact forces, of tanks, missiles, aircraft, warships and the men to deploy them, has received considerable publicity lately. Those of your Lordships who listened to the retired Chief of Defence Staff addressing the All-Party Defence Study Group last July will be only too well aware of the considerable strength and capabilities ranged against us. So it came as a real encouragement, certainly to those on this side of the House, and particularly to both the Regular and the Reserve Forces, to hear that one of the first pledges of the new Government on taking office was to increase defence expenditure by 3 per cent. in real terms until 1986, and to award the Services the full pay rise recommended by the Armed Forces Pay Review Body, bringing Servicemen into line realistically with their civilian counterparts and promising to maintain this comparability in future, which to some extent should stop the outflow of people from the Services.
It is of course argued at a time of national penury that any increase in the defence budget is not so much in the interests of the nation as improvements in the social services or other areas of the Welfare State might be. But I submit that expense is one thing: value for money is another. For example, the total cost of the Territorial Army to the nation is just over 3 per cent. of the Army's share of the Defence Vote, which in turn works out at just over 1 per cent. of the total defence budget. Yet the Territorial Army provides 28 per cent. of our mobilised Army in Germany. That represents considerable cost-effectiveness, and the value that it provides as part of our overall defence effort is in the very deepest interests of the country. In Britain we are almost unique among our European NATO allies in that we have no conscription, National Service or anything like that. While it existed, there were considerable numbers of individuals who had some military background and who in many cases had an obligatory period of Reserve service to undertake when their full-time National Service expired. At the same time, however, our Regular Forces were considerably larger than they are today, and the same reliance was not placed upon the Reserves as is the case
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now. They were not as well equipped and in some cases, perhaps, not as professional as they needed to be and as trained Reserves are today.
Today's trained Reserves for all three Services are, as I have said, volunteers. They take part in it because they see a sense of purpose in it, and because they enjoy it. Indeed, I think it is no exaggeration to say that volunteers must regard their Reserve training as their main hobby. Perhaps I can give your Lordships an example from the Territorial Army. Imagine what it is like for a person to walk, or get home somehow, from his place of work on a Friday evening; to go straight to his TA headquarters, there to change into uniform, prepare his vehicles and his equipment and attend briefings; and eventually deploy overnight to an area perhaps 100 miles or so away to be ready to commence an exercise starting at first light on Saturday. He exercises throughout Saturday, throughout Saturday night, and perhaps until midday on Sunday, before being faced with the tedious journey back after no sleep, de-kitting, the cleaning up of vehicles, debriefing and learning all he may from the exercise. Eventually, perhaps, he gets home for supper on the Sunday. My Lords, efforts of that sort require not only a great deal of hard work but dedication, loyalty and the achievement of a considerable amount of personal satisfaction and enjoyment, as well as much understanding on the part of the individual's family.
Of course, the Reservist is paid regular rates for the time that he is undergoing his training; and, furthermore, he now receives an enhanced bounty after three years, which amounts to some £300 per year if he completes his annual quota of training. No one would dream of suggesting that the volunteer does it for the money. He could probably earn far more by doing overtime at his normal place of work. During my last two years with the Regular Army I had the privilege of working very closely with the two armoured reconnaissance regiments of the Territorial Army, the Royal Yeomanry and the Queen's Own Yeomanry. If any of us Regulars were a little sceptical to begin with about the ability we might find, those thoughts were very swiftly dispelled and we soon came to respect the enormous enthusiasm and professionalism of those we supported. If in any way there were

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gaps in their military ability—and there were very few—they were admirably filled by the good humour, zeal and energy which they displayed.
My Lords, it seems to me that in order to maintain the effectiveness of our Reserves, and indeed to improve them, we must concentrate on three areas: manpower, the provision of equipment and, to a considerable extent, public relations. So far as the trained Reserves are concerned, each of the Services is below strength. Perhaps I may run through each of the Services in turn. The Royal Naval Reserve has about 6,500 members; yet it has a major and increasing sea-going role, chiefly in mine counter-measures. It will, as I understand it, operate the new Hunt Class mine counter-measures vessels, of which the first, HMS "Brecon", was launched very recently. Additionally, the Royal Naval Reserve is to operate the 12 extra-deep Armed Team Sweep vessels, based on trawler design, which are currently under development. Therefore, although the equipment side is encouraging, there are definite gaps on the manpower side, and a sustained effort is required to put this to rights.
Recently, the formation of a new Naval Reserve of helicopter pilots was announced. This Reserve will, we are told, augment front-line helicopter squadrons and introduce a pool of expertise for communications flying. Although it intends to recruit only 40 aircrew initially, rising to 60 in the early 'eighties, I suspect that it will be well subscribed. Certainly many of my professional pilot colleagues with a naval background have indicated a desire to use their flying skills in a Reserve role. So it makes a great deal of sense to direct back to the Navy many of the skills acquired there at colossal expense in the first place, and which have since played such an important role in the development of North Sea oil, for example.
Turning to the Army, this possesses the greatest number of trained Reservists. There are about 60,000 members of the Territorial Army at the moment. But, again, the Territorial Army is some 20 per cent. under strength. Additionally, there are over 7,500 members of the Ulster Defence Regiment. Without wishing to show any disrespect to the Ulster Defence Regiment, for which I have
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boundless admiration, I shall not talk about their particular role at length today, as I should rather concentrate on the NATO aspect. However, I am certain that I speak for noble Lords on both sides and in all corners of the House when I say that we all have immense admiration for them in the difficult job that they have to do and for the courage and devotion to duty which they show in difficult circumstances.
The Shapland Committee report on the study of manpower wastage in the Territorial Army has been published and certain of the key recommendations have been adopted, a fact which I know has been greatly appreciated by the Territorial Army. I was encouraged to hear from the noble Lord the Minister in answer to my Starred Question last week that other recommendations are being studied. I was heartened also to hear in answer to my supplementary question that the Government are taking steps to promote throughout the Government agencies, nationalised industries and industry as a whole the importance of allowing reservists time off to train. There is no doubt that employers and the country at large are far from enlightened as to the relevance today of any of the Reserves and I feel that it is important that efforts be made to promote this understanding.
It is interesting to note that in the year ending March, 1977, which, I know, is a little out of date, out of 54,000 Territorial Army soldiers eligible for a bounty, only 26,600 did the minimum training necessary to qualify for a bounty. I do not support legislation in this area but those who take part in Reserve training should not be required to make undue personal sacrifice in the light of the importance of the Territorial Army over holidays and the like.
So far as the Army's Regular Reserves of some 121,500 are concerned, it makes a great deal of sense to have improved the mobilisation plans, albeit for only 50,000 of them, by intending to issue them with equipment and asking them to report once a year to ensure that they and their equipment are in good order. It eases mobilisation plans considerably and one hopes that, in addition to those who are compelled to take part under the training obligation which they have and which hitherto has not been invoked, volunteers

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will also come forward. I look forward to the scheme being extended to include the Royal Navy. One aspect which concerns me is the strength of the Army Reserves left in the United Kingdom on mobilisation. I understand that almost 80 per cent. of the Territorial Army will be deployed in mainland Europe. This leaves home defence desperately weak. This is about only 15,000 or 20,000 trained Army reservists in the United Kingdom—which has been described as the equivalent of a rather thin crowd at Twickenham. I fear that our preoccupation with the deployment of our trained Army Reserves in Europe has left a serious gap here. I suggest that a reappraisal of our home defence (and civil defence, which is another subject) is required.
The Royal Air Force has the fewest trained Reserves, at present about 300 in all. But this has been expanded to provide three squadrons of airfield defence volunteers for which, I understand, recruiting is going well and is approaching half the establishment required. There is no reserve flying role for aircrew. As far as high performance aircraft are concerned, I think that this is quite understandable. I have some little practical experience of it. Last February the noble Lord, Lord Trefgarne, and I flew in a Jaguar at Lossiemouth and I saw at first hand that the skills and practice required not only to fly the aircraft but to deliver weapons from them and to keep pace with a technologically complex subject are so enormous that to attempt to do it part-time is unrealistic.
However, the training of any pilot is very expensive. Apparently, it approaches half a million pounds and rises to over £l million for a fully-trained fighter pilot. It is expensive, but it seems to me that there is scope for using the ex-RAF helicopter pilots who are in current flying practice, in a similar way to that being planned for the Navy. That is something which I hope the Government will consider.
Having discussed manpower, I should like to talk about making the best use of our resources when it comes to equipment in industrial or commercial use. I hope that I may he forgiven for producing yet another helicopter example, because I am involved in it. There are over 450 civilian-registered helicopters in this country and
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about 70 of them are large machines ideally suited to increasing the efficiency of the support helicopter role of the RAF or the Royal Navy. So far as I know, no reserve role exists for any of them; nor, indeed, for the 380 smaller machines. If you connect this with the availability of manpower, there are over a thousand pilots flying them and 98 per cent. are Service-trained. I should be interested to know whether the noble Lord, Lord Strathcona and Mount Royal, can confirm that his Ministry are aware of this apparently untapped resource.
My Lords, I have spoken for long enough. The subject is a large one and covers much more ground than I can hope to discuss by myself this afternoon. Suffice it to say that the Reserves are a fully-integrated and essential part of our national defence effort, both on the Continent of Europe, at sea and in the United Kingdom. Money is always scarce; so let us make the best use of those Reserves which offer real cost-effectiveness in defence terms. Public goodwill towards the Reserves abounds, and the ability and enthusiasm of those who volunteer is considerable. I trust that the Government will continue to develop the existing Reserves and, where necessary, expand them to fill the gaps which obviously exist. My Lords, I beg to move for Papers.
3.6 p.m.
Lord SHINWELL: My Lords, the noble Lord justifiably deserves congratulations on his speech and also on the subject he has chosen for debate. As he rightly said, we have not had, at any rate for a long time, a full debate concerning our Reserve Forces. But I can inform him that seldom have we had a debate on defence and the Estimates and matters concerning the national security without substantial reference being made to the need for Reserve Forces. Perhaps many noble Lords present will recall that I have repeatedly advocated the need for strengthening our Reserve Forces. I have not only ventured to offer opinions on the subject in this House, but I did so in another place, sometimes without evoking much enthusiasm—that I readily admit—and also when I was associated with the Labour Government as Secretary for War and Minister for Defence,

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There ought not to be any partisanship on a subject of this character. I mean by that that there ought not to be acute divisions of opinion on a subject which concerns our security. It should be wholehearted and universal. After all, it concerns every person in the land irrespective of his political partisanship. There is no use in accusing the Labour Party or previous Labour Governments for their lack of enthusiasm in building up our Reserve Forces or in matters concerning defence. After all, following the decision of the electors and the formation of a majority Labour Government in 1945, we had to face the legacy of National Service and, in particular, international tension which could not he shrugged aside. Then, despite financial difficulties which were extremely acute at the time, and despite the lack of enthusiasm, and despite our suffering grievous loss of manpower and dissipation of our financial resources, we continued with National Service for several years despite some opposition from the ranks of the party to which I belong, and indeed a lack of enthusiasm in the country. One could hardly expect much enthusiasm following a great war.
Moreover, this subject of Reserve Forces, which of course relates primarily to manpower—of course, we cannot ignore equipment, finance and ancillary matters—was very largely subordinated in the public mind and in the political spheres in the country because of the White Paper of 1957. The noble Lord, Lord Duncan-Sandys, is not present; but I would hardly expect him to come along for a debate of this kind, and he might be busy elsewhere. He conceived the notion that the future had very little relation to manpower but to nuclear strength. Ever since then there has been a division of opinion as between the military experts and those who are less expert, who are amateurs in this "game ", as between the need for nuclear strength and conventional power.
So we are faced with a situation at the present time when we have to deal with the controversy which concerns the whole of Europe and NATO in particular and has its repercussions throughout the world. We are dealing with whether we should use our resources, such as they are or what they are likely to be in the future. Even in the most optimistic vein we do not
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expect too much. Also we are dealing with whether we should focus attention on nuclear weapons, missiles capable of causing devastation if unfortunately a conflict occurred, but primarily for the purposes of a deterrent. In other words, to put it bluntly—and not being afraid to put it bluntly—to say to a possible aggressor: "If you start any nonsense you will have to deal with a situation which probably you did not contemplate because of our alleged weakness. We are not as weak as you suspect ".
What is to be done about the situation? When I saw on the Order Paper the Motion for which the noble Lord is responsible I put my name down with no intention of making a long speech—I give your Lordships that assurance, if it provides any consolation—and certainly without wishing to make any attempt at oratory on a subject of this kind. One has to be realistic. On this subject of realism I must digress for a moment. What has concerned me frequently in your Lordships' House is this. We have the most remarkable debates on a variety of topics, mostly of an academic and intellectual character. Reference was made yesterday to the presence in your Lordships' House of 13 Fellows of the Royal Society and a host of others who exude expertise. I sometimes wonder how it is that, with all the intelligence and all the academic and scientific knowledge that we possess, the country is in such a mess. There must be something wrong. I know it is easy enough to find a scapegoat, say a trade union leader or the people on the shop floor. But that will not do. It is a remarkable fact which we have to face that, despite our high intelligence—about that there can be no question—our scientific and technical knowledge, and technological know-how, we are in a frightful industrial, economic and financial mess.
I venture a reason for it. The other day we had a debate in this House on shipbuilding. I spoke for only a few minutes, and I am afraid that I worried quite a number of noble Lords who expected a long discourse on the shipbuilding situation. I gave nothing of the sort. I simply asked: What is the cause of the trouble? Why are we weak? I ask that question now. Why are we weak?

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I have the highest regard and respect for the noble Lord, Lord Strathcona and Mount Royal. I wish him well now that he has been elevated, rightly, to the Front Bench. If he replies to this debate he might say: "What is the use of talking about weakness? In the TAVR we have 60,000 people. We have a Regular Reserve of 130,000 people, and we can call upon a large number of others in the event of conflict. We have a potential, and therefore we are not as weak as is supposed ". If he says that, I will not argue any further. If, on the other hand, he accepts what the noble Lord, Lord Glenarthur, has said: manpower 3 per cent., helicopters not properly equipped or used, what are we going to do about that? We have in your Lordships' House some remarkable military experts. One is to follow me. I hesitate to think what he will say about this speech of mine. He will probably say: "He knows nothing about it. He was just a Minister and probably did as he was told ". He had better look up Lord Montgomery's memoirs in order to correct that impression.
We have other Members, Admirals of the Fleet, Field Marshals, a whole collection of military experts. What are they going to do about it? Something has to be done about. it If anybody supposes that, as a result of this debate and eloquent speeches such as we have just heard, and amateur speeches, such as your Lordships are listening to now, there is going to be a change in the situation which is going to lead to the build-up of effective Reserve Forces, they are mistaken. It requires organisation; it requires will; it requires enthusiasm on the part of the general public; it requires an understanding of the insecurity in which we find ourselves, which may be more intense in the future. It requires all that.
I should like, as a result of this debate, those military experts to make up their minds, shrugging aside all the trifling issues that might be raised, that they are going to play a part in this, that there should be a campaign in the country. That is to say—and I emphasise this—if we believe that we ought to increase our security by building up Reserve Forces. If we do not, then that is the end of the matter. However, if we do, if we regard it as essential, then they will have to help us to put things right. I hope that
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the noble Lord, Lord Strathcona, when he replies to the debate, will give some attention to the realistic aspects of what should be done about it, if anything should be done.
It is easy enough to say: "It is not so bad after all. International tension exists. We know all about it, but we do not expect a war the day after next or even in a month or two. I understand that the ideas will take another six years before they decide to have a conflict, and they are not quite sure whether it will be with nuclear weapons or with conventional weapons ". We can say that, but it will not do. Either we believe that we are too weak on the Reserve side in connection with the Army, the Navy and the Air Force, and in particular as regards civil defence—and nothing has been said about that—and something has to be done about it, and immediately, or else we just have a nice academic debate and (apart from the speech to which your Lordships are now listening) there will be wonderful speeches from the experts who know much more about the subject than I do, but at the end of the day there will be no implementation and nothing will be done. We will go on talking and talking, and pelading and pleading, until some fine day we "catch it in the neck" and we have to return to conscription—a subject about which my noble friend Lord Wigg knows more than any other person present, even the military experts. That will not do. So let us be realistic about this issue. If we are not, I say to the noble Lord, enthusiastic as he may be and expert as he may be, that his speech will be a thing of shreds and patches.
3.22 p.m.
Lord CARVER: My Lords, I am extremely pleased to be able to support the Motion of the noble Lord, Lord Glenarthur, in particular because he uses the word "effective ". I think it is to the effectiveness or lack of effectiveness of our Reserves that we should draw attention. I shall attempt to meet the challenge put by the noble Lord, Lord Shinwell, of being realistic, and also to meet the challenge of keeping within 10 minutes.
Fifteen years ago I myself was very closely concerned in the reorganisation of both the Territorial Army and the Army Emergency Reserve into the Terri-

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torial and Army Volunteer Reserve. That reorganisation was absolutely necessary because at that time both were largely, if not totally, ineffective. Together, they were far too large, so that they could not possibly be recruited to anything like their potential establishment. They were too large to be properly trained; they were too large to be clothed properly or to be equipped; they were still living on what was left over the from Second World War. What is more, they were far too large to meet any real requirement, given the limitations of a voluntary force and what the NATO strategy was, and still is.
The situation today as I see it—and I will speak only of the Army Reserves—is a great deal better. Of the combat units of the Territorial Army, practically all are recruited at 80 per cent. or over. The overall total of 60 per cent. of the TA allows for under-recruitment in certain specific areas. They are well equipped, well trained and most of them have realistic tasks which they themselves can feel are really needed. But of course the Regular Reserve is now a great deal smaller than it was then, and that rather bogus reserve of all, the ex-National Serviceman, has disappeared. However, the dilemma remains which faced us then, which is that the Territorial Army does not always exactly like meeting what is the real need of the Army for Reserve Forces.
What is that need? The first need in support of NATO—the overall need to provide individuals and units to complete the wartime order of battle of NATO—consists of three main parts. The first and perhaps the most important is primarily logistic, to replace largely the civilians employed in peacetime. Secondly, the need is to find some extra combat units, given the limitations of training of a volunteer force which the Shapland Report fully realised. They must have simple tasks and they are largely tasks of a defensive nature, such as demolition and bridge guards. Finally, they need individuals to bring Regular units up to war establishment and to replace casualties.
That is the primary function of the Regular Reserve and, as I see it, these tasks are fairly satisfactorily met today, though there are certain weaknesses. The first is a lack of volunteer reservists for logistic reinforcement, particularly
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among the important specialists, who are largely founded by what are called "sponsored units" or "sponsored individuals "—largely those who, in the old days, were in the Army Emergency Reserve.
Secondly, as is pointed out in paragraph 207 of this year's Defence White Paper produced by the previous Government, there are some unsatisfactory aspects of the procedures for the recall of Regular reservists. I should like to ask the noble Lord the Minister whether he can tell us the result of the study of those procedures which was referred to in that paragraph.
It is to the second main task, of home defence, that I should like to draw attention. It is a very vague term and covers a host of things. Only too often an out-of-date concept is retained, in which people think that what home defence consists of is trying to repel invaders who either land on the beaches or drop from the air. That is not a realistic scenario now. The two threats are, first, threats of bombs or explosive warheads landing on this country, whether they land on cities or on targets such as nuclear delivery systems or any other military target. The second is that of sabotage of military installations or essential services. Nothing really in our defence or Government plans is done about either of those to any realistic degree. Regular and general reserve battalions of the Territorial Army allotted to home defence are ineffective to meet either of those threats; and it is an unsatisfactory role for them because they know they are ineffective.
What is the need here? The first need, of course, is a combination of air defence and civil defence. Air defence is thought of by most people today as shooting down aeroplanes, but it meets only to a very small degree the attempt to stop these things landing on this country. I do not for one moment suggest that we should invest in an anti-ballistic missile defence. Civil defence is non-existent and the fact that it is so when there are so many potential targets in this country, is to my mind little less than a scandal.
As regards the second threat to internal security, it is quite unrealistic to think that infantry battalions, whether Regular or Territorial Army, standing round the sort of targets one is thinking of really provide

1157
any serious deterrent to or protection against that sort of threat. The saboteur will already have established himself inside the organisation and the answer to this, whether it is a military or civil target, must be that all establishments of this nature must have, and must be forced by the Government to have, a really effective internal security service of their own, which could be reinforced in emergency by specialist volunteers. I think it is admirable that the Royal Air Force have got round to this in the air defence volunteers for their airfields. That is the sort of pattern that is needed to meet the sabotage threat, whether the target is military or civilian.
I suggest to the Government that they really need to take a radical new look at home defence, at both the need and the most effective way to meet it. I do not believe that the general reserve battalions of the Territorial Army are in any way needed for this, or suited to it. Therefore, 1 think that the Government have to look again at a further task for the Territorial Army and, although I do not suppose it will be popular with the Ministry of Defence or the TA, I suggest that they might see whether they could provide individuals and sub-units to reinforce Regular combat units and Regular logistic units in wartime, on the kind of pattern that the German army does today. I believe that that would not only help to meet some of the Regular manpower shortfall, but would also be a satisfactory form of service for a volunteer reservist. Of course some of them do this already, but not a great many.
There is a further need, which really need cost no money at all, but which is totally lacking in our national plans. On the threat of war or emergency, there will be a very considerable need for general guard and security forces, and for drivers for all kinds of things. But there exists a ridiculous situation, in which the Royal Corps of Transport pools of drivers in the Territorial Army are either very short of men or consist largely of people who cannot drive, the reason why they have joined being that they want to learn to drive. But there is an enormous number of drivers in this country, even in this House, and when an emergency exists there should be provision to meet that kind of need by volunteers, who probably need little or no training on call-up and
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who, I suggest, are mostly time-expired reservists.
Finally, if I may make one further suggestion to the Minister, the split in responsibility between the Director of Volunteers, Territorials and Cadets in the Army Department of the Ministry of Defence and the Commander-in-Chief United Kingdom Land Forces should be done away with. There is absolutely no reason why all matters connected with the Territorial Army should not be dealt with by the headquarters of United Kingdom Land Forces at Wilton. I cannot conceive any objection from the point of view of the Ministry of Defence. I suggest that objection is likely to come from the TA Council, who might feel that they were not able to lobby at the very top. But those—and I hope that the noble Lord, Lord Shinwell, will agree—are perhaps some realistic suggestions for maintaining the effectiveness of the Reserve Forces.

POST OFFICE INDUSTRIAL DEMOCRACY
3.33 p.m.
The MINISTER of STATE, DEPARTMENT of INDUSTRY (Viscount Trenchard): My Lords, with the leave of the House, may I repeat a Statement on the Post Office which has been made in the other place by my right honourable friend the Secretary of State for Industry. I am aware that your Lordships were told from our Front Bench that the Statement on agriculture would come first. I understand that the order of the Statements has been changed in the other place, but I should just like to pause for a second and ask: have I the leave of the House to repeat the Statement on the Post Office now?
Lord PEART: Yes, carry on.
Viscount TRENCHARD: My Lords, the Statement runs:
"With permission, I will make a Statement about the future of the Post Office Board.
"It is the Government's policy to encourage increased involvement of employees in decisions affecting their interests. But it is not for the Government to lay down how this should be achieved. The precise arrangements are for discussion and agreement between employers and their employees

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in the light of the particular circumstances of each individual business. This applies equally to nationalised industries, subject to any necessary Government and parliamentary approval.
"In the case of the Post Office, the management and the Council of Post Office Unions agreed two years ago that there should be an experiment in industrial democracy at all levels in the business, including the main Board. My predecessor facilitated in January, 1978, the main Board experiment by appointing seven representatives of the Post Office trade unions to be part-time members of the Board. He also appointed two consumer representatives. These appointments are due to expire on 31st December, at the end of the agreed two-year period of the experiment.
"In accordance with our general policy, it is for the Post Office and the Post Office unions to decide together what form they wish employee participation to take after the end of this year. One thing is quite clear at the present time; they do not agree that this particular experiment at main Board level should continue. Broadly, the unions are in favour of a continuation, whilst management and a majority of the independent members of the Board are not.
"The Chairman of the Post Office is continuing consultations with the unions and is making new proposals for close employee involvement in top level Post Office decision-making. It is for the Post Office management and the unions to agree on the way forward. I shall, of course, be ready to take any action that might fall to me to facilitate whatever new arrangements might be agreed between the Post Office and the unions. If an agreement were to be reached within the next two months which required such action, this could include bringing before Parliament an order under the terms of the Post Office Act 1977 to make permanent the statutory powers to make additional appointments to the Board.
"However, in the absence of agreement that the two-year experiment
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should continue, the Board appointments made for the purpose of that experiment will lapse at the end of the year.
"I would like to express my appreciation for the contribution made by all those who have played a part in this experiment."
My Lords, that is the end of the Statement.
3.37 p.m.
Lord PONSONBY of SHULBREDE: My Lords, may I first thank the noble Viscount for repeating the Statement on the industrial democracy experiment which is being made in another place at the present time. I can only regret the contents of this Statement. It is, as I see it, harmful to industrial relations as it puts the clock back, and it is certainly ironic, at a time when the country is seeking better worker participation, that this experiment should be curtailed. It is also ironic that only 18 months ago Sir William Barlow was writing in the annual report of the Post Office:
"The experiment is still in its early stages, but so far I have been impressed by the way in which the Board has dealt with matters of policy and has already contributed much to the major decisions that have to be taken about the future of this massive organisation and its rapidly expanding range of services. Although this is a radical departure, it is an extension of the Post Office's rich history of participation through extensive consultative arrangements at all levels, built up over many years".
Indeed, we learned from yesterday's Financial Times that the view of the union representatives on the Post Office Board is that with such a conservative management the experiment has just not been running long enough for any real assessment to be made, not least because so many major policy items take at least two years to germinate. Therefore, it should continue. Indeed, I am sure it is true that things do take a long time to happen and that it takes a long time for the fruits to be plucked.
One has learned with interest of the report which has been prepared by the Industrial Relations Research Unit at Warwick University, under the chairmanship of Professor Dorothy Wedderburn, and one wonders—and indeed I should like to ask the Minister—whether it is the Government's intention that this report

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should be published. We understand that report is likely to be critical of management's attitude throughout the experiment. In the light of today's Statement, one would have thought that it would be particularly useful that the report should be published so that we could see what that assessment has been.
Another effect of this curtailment of the experiment is that the consumer representatives, of whom there are two, will also lose their places on the Post Office Board. These representatives were put on the hoard at the instigation of the Liberal Party. So I cannot hold out any affection for the Statement which the noble Viscount has given to us this afternoon. I regard it as a very retrograde step.
Viscount SIMON: My Lords, from these Benches I should also like to thank the noble Viscount for repeating the Statement. I was very glad to have it confirmed at the opening of the Statement that it is the Government's policy to encourage the increased involvement of employees in decisions affecting their interests. In those conditions, it seems to me to be a thousand pities to abolish this experiment before anything else has been put in its place. May I ask the noble Viscount whether or not it would be possible to continue the present arrangements and the nomination of the directors until such time as appropriate and adequate arrangements can be agreed between the board and the trade unions.
We on these Benches would prefer trade union representatives to be elected rather than nominated by the unions. All sorts of alternatives could be discussed, but surely we should keep the present arrangement going until something else is there to put in its place. If that is not done it will be, in my opinion, a very severe setback to the advancement of what is I always think unhappily called "industrial democracy"—of worker participation in this important industry. Indeed, it seems to me that it would throw some doubt on the validity of the Government's real commitment to the policy which they have expounded.
I think that the noble Lord, Lord Ponsonby of Shulbrede, has asked the other question which I was going to put to the noble Viscount. However. I have two small ones. I could not understand
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what was the relevance of the reference to the "next two months ". As I understand it, the intention of the Government is that the experiment should come to an end at the end of this year; so I am not sure what the two months have to do with the matter. But perhaps the noble Viscount can explain that point.
May I also ask him about the consumer representatives. We on these Benches very much favour consumer representatives. It is not quite clear from the Statement that the consumer representatives are also going to he swept away at the end of this year. Perhaps the noble Viscount can make that point clear in his reply.
Viscount TRENCHARD: My Lords, may I thank both noble Lords for the points which they have made. Perhaps I could start by saying that the Government are neither curtailing nor abolishing this experiment. The experiment stems from a joint agreement which was negotiated by the parties concerned. It was negotiated for a two year period as an experiment.
The Government do not feel any great affection for having to make the Statement at this time. Indeed, my right honourable friends, both the Secretary of State and the Minister of State, have spent a very large amount of time in consultation and in receiving the individual views of board members to try to facilitate any agreement to the continuation of this experiment. But there is no agreement—quite definitely not.
It is clear that a majority of the board feel that the purpose of the agreement; namely, to improve the efficiency of the Post Office and to make it more effective and able to perform a better service, is not being facilitated by this form of employee co-operation. In this situation, the Government are not in the position of deciding to curtail or to abolish; they are simply not in a position to tell the parties to the agreement to continue that agreement when they have not agreed to do so.
I am well supplied with many quotations, but I shall give only one to your Lordships. On 25th January 1977, at col. 1181, the right honourable gentleman the Prime Minister said:

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" I accept that the principle of industrial democracy, if it is to be permanently based, must arise from agreement between both sides ".
Unfortunately, we are in a position where there is no agreement to continue the experiment in this form. The Warwick University report will be made available in the Library of both Houses in a few days. With the permission of the parties concerned, we hope to put with it a consolidation of the views of the Post Office Board on the same question. I do not think that at this stage I should add any comments to the reasons why it has been found not to be possible to achieve agreement.
So far as the period of two months is concerned, allowance was made in the 1977 Act for that Act to continue for a period, in case, at the end of the experiment, time was needed to make the minor alterations permitted under the Act. There therefore remain two months from now for the consultations which the Chairman of the Post Office is still having. As my right honourable friend mentioned in his Statement, if during those two months some of his powers under the Act are indeed needed in relation to any part-time members, they are there to be used.
So far as the consumer representatives are concerned, their positions lapse also, and the views of the board and of Warwick University will no doubt touch upon their positions as well.
Baroness PHILLIPS: My Lords, may I ask the Minister whether he would put to his right honourable friend the view—I do not think that it carries the force of law—that since it has been suggested to private industry that it is highly desirable to have both worker participation and indeed consumer participation at the highest board level, it would be extremely unfortunate at this time if the nationalised industries were to be seen not to be carrying out this very useful process of improving the quality of the service which they can give?
Viscount TRENCHARD: My Lords, I thank the noble Baroness for making that point. I am sure that in the future the House will have a number of opportunities to discuss the role of boards and the problems of the representation of different
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interests, either by means of direct representation from the interests concerned or by the choice of people of wide experience from more than one sector. These are areas in which individual enterprises will have to find out what is the most efficient way to combine the single-minded efficiency of the enterprise as a whole, upon which its future depends, with the necessary degree of taking account of the views of important sections of the workforce of that enterprise.
Lord BOYD-CARPENTER: My Lords, can my noble friend confirm that the unhappy (as I think we all feel it to be) outcome of this experiment has tended to confirm the anxieties which many of us in industry who are interested in forwarding employee participation have felt about this expedient of so-called worker-directors? Has it confirmed-which is our anxiety—the suggestion that the trade union-nominated or employee-nominated worker-director is exposed to a very difficult clash of loyalties in deciding whether his first loyalty is to the union, to the employees who nominated him or to the board of the company on which he is serving? Can the noble Viscount say whether this experiment has thrown any light on that, which many of us think is the basic difficulty?
Viscount TRENCHARD: My Lords, I thank my noble friend for that question. The first thing I should like to say is that the Government and the Post Office Board—this was in the Statement—are deeply indebted for the dedicated and unpaid efforts of the trade union members on the Post Office Board for the period of this experiment. I want to make it quite clear that this is our view and we are grateful for the efforts that they have put in.
I must ask my noble friend to await the consolidation of the Board's views, which we shall place in the Library, to take in the differing and complex views of this subject. However, it will indeed refer to the problem of combining the single-minded necessity for the board as a whole to go forward in pursuit of efficiency with a rather separate kind of necessity to consult deeply with employees or indeed to take account of consumer views. It is the reconcilitaion of these in a manageable way which seems to have beaten those engaged in this particular experiment.
Baroness FISHER of REDNAL: My Lords, may I ask the Minister, in view of the EEC's concern and the European Parliament's concern about worker participation in the European Community, especially as it seems to be successful in many of the countries of our partners in the EEC, why the Government find it so difficult to operate it in this country, hearing in mind that Germany and France and many of our European partners find it a suitable vehicle? Might it not be that because they find it a much more suitable vehicle they get greater worker participation and fewer strikes arising in those industries?
Viscount TRENCHARD: My Lords, I will first say to the noble Baroness that neither here, in this case, nor in my experience of Continental countries, which is considerable, do the Government operate this—or not in industrial areas. It is operated by the companies and industries concerned. With regard to why this experiment has not succeeded and why our pattern is very different from the Continent one has to look at the whole picture. They have a highly developed joint consultation system, often backed by law, but they also have a closely regulated trade union system within a very definite legal framework and, as in many areas, one country's experience based on its whole background history and way of dealing with things is not a blueprint copy for another country. I certainly know, however, that important industries in this country, both nationalised and private-sector, have experience and have studied in great detail the Continental practices and that that is part of their background for trying to improve the many areas that need improvement in this country.
Lord KALDOR: My Lords, the noble Viscount stated that the majority of directors of the Board were against the continuation of the experiment. Can he say whether this majority included any of the workers' representatives on the Board and will it be possible for Members of this House to get more information on the reasons of the directors who voted against the continuation of the experiment?
Viscount TRENCHARD: My Lords, as my right honourable friend's Statement made clear, in the main the worker-
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directors—the trade union-nominated directors—were in favour of continuation. The Post Office directors and the majority of the independent directors were against it. That hides a large number of very different individual views of which my right honourable friend has been taking note. So far as the reasons are concerned, I have already told the House that the Warwick University Report will be available and also that the consolidation document of the views of the Board will be available.

COUNCIL OF MINISTERS (AGRICULTURE) MEETING
3.56 p.m.
Earl FERRERS: My Lords, with the leave of the House I should like to repeat a Statement which my right honourable friend the Minister of Agriculture, Fisheries and Food is making in another place about the meeting of the Council of Agriculture Ministers in Brussels which took place on 10th and 11th December. The Statement is as follows:
"At my request the Commission proposed a 5 per cent. devaluation of the green pound in order to boost the resources available to British agriculture. The devaluation will take effect on 17th December for all the main commodities except cereals and eggs and poultry, where the change will take place at the start of the next marketing year on 1st August 1980. For wine, the devlauation will not take effect until December 1980. This devaluation will be of great importance to British agriculture and it will add some £150 million to farmers' returns in a full year. The effect on consumer prices will amount to one quarter of one per cent. on the retail price index, but it will be many months before the full effect of the ¼ per cent. Increase reaches the shops.
"The Council also agreed a 5 per cent. devaluation of the Italian green lira.
"The Council agreed a mandate for the Commission to negotiate voluntary restraint arrangements by third countries exporting sheepmeat to the Community. The mandate was in

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accordance with our insistence that any agreement should be a totally voluntary agreement on the part of New Zealand and that there would be no unbinding of the GATT tariff arrangements. We rejected a French proposal that there should be a threat of unbinding the GATT for any country that refused to reach a voluntary agreement.
"We and the Commission also rejected a French request to the Commission that no action should be taken by the Commission in respect of the illegal French measures on sheepmeat imports. We again made it clear we would not accept any sheepmeat regime that failed to give a net benefit to Britain or included intervention.
"Proposals were before the Council for a wine package designed to restore balance to the wine market and to avoid surpluses. The package was such that Community payments of £32.5 million per annum would have resulted in equivalent Community savings of £32.5 million per annum. We succeeded in negotiating a substantial reduction in the Commission's proposed FEOGA payments so that the savings will outweigh the payments and produce an anticipated net reduction in the Community Budget of £6.5 million per annum over the period of the programme. We also resisted French pressure to bring into the package, at the very last moment, an extension of present temporary arrangements protecting producers from low market prices at the end of long term storage contracts.
"We also secured an agreement that at the end of the current seven-year programme of restructuring, with its ban on new plantings, there would be a review by the Commission. This should ensure that planting controls will be maintained if there is any further risk of surplus production. The package finally agreed will therefore reduce the contribution of the United Kingdom towards Europe's wine régime.
"Agreement was reached on a group of animal health measures, which fully meets the United Kingdom's requirements, and we obtained an extension for a further six months of the derogation enabling the United Kingdom, the
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Irish Republic and Denmark to maintain their national swine fever requirements for imports of pigs and fresh pigmeat ".
My Lords, that concludes the Statement.
4.1 p.m.
Lord PEART: My Lords, I am grateful to the Minister for coming to the House and stating what has happened in Brussels. The devaluation which he mentions will certainly be of great importance to British agriculture. There is a problem here about the consumer. The noble Lord has spelled out that the effect on consumer prices will amount to ¼ of 1 per cent. on the Retail Price Index and it will be many months before the full effects of this increase reaches the shops. I hope the Minister is being realistic here. I am all for helping the farmers. I recognise, after all, that the farmers produce food for the consumer. There must be a proper balance. I hope he has it right.
May I ask about the hill farmers? Is it possible to break this figure down to show what aid is going to be given to hill farmers, who have had a rough time over a long period? I am thinking about the recent weather affecting Scotland, the North of England, the South-West and also Northern Ireland, which also are affected by this price review. I would be grateful for any information about that.
If I may turn to sheepmeat, I am glad that so far it seems that New Zealand is going to be protected. We know that France and other countries have sometimes sniped at Britain for allowing imports of New Zealand lamb. I believe that New Zealand is part of our own set-up and must be protected. I hope the Minister feels that this arrangement is satisfactory. On the other hand, the Government have not been able to persuade France to meet her legal obligations; she is still defying the European Court. Why has there been no real progress on this? Has it been suggested that, because no action has been taken on wine, quietness has been achieved in this respect?
May I ask also about the animal health measures which, to use the words of the Minister, fully meet the United Kingdom requirements, and
" we obtained an extension for a further six months of the derogation enabling the United

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Kingdom, the Irish Republic and Denmark to maintain their national swine fever requirements ".
Can the Minister go into further detail about this? Our animal health is far superior to that in any other parts of Europe. I feel strongly about this because I was once in the position of a Minister who had to face the biggest outbreak of foot and mouth disease we have ever had. I have always felt that we should be very sensitive about what is happening in Europe, because there is still a lot of foot and mouth disease about in Europe, where they do not have the rigid controls we have. I should be grateful if the noble Lord would answer those general broad questions.
Lord MACKIE of BENSHIE: My Lords, I, too, should like to welcome the Statement which the Minister has repeated. It is one which will be extremely welcome throughout the agricultural industry and something which is very necessary indeed. For example—I take it as only an example—in Scotland last year real incomes in the farming community fell by 11 per cent. Even more significant and more worrying in the long term is the fact that bank overdrafts of the farming community in Scotland have nearly doubled in the last year. At a figure of 20 per cent. or over, this is a burden which it is extraordinarily difficult for any industry to bear, particularly one working on the narrow margins—and I say that without fear of contradiction—that the farming industry is working on at the present time. The 5 per cent. will certainly be most welcome. But I would ask the Minister what gap remains before we have parity in the Community? This is quite an important point. I would also ask if they intend to do anything to introduce some form of parity as regards the terms for borrowing money. Some recent programmes have shown some extraordinarily wonderful schemes for the farming community on the Continent, where farmers have been able to borrow money for as little as 2 to 3 per cent. This is a gap which is highly significant in times like these.
I would also ask about the voluntary restraint by third countries. Does this mean that we are going to ask New Zealand to reduce the amount of lamb she sends to this country, or not to increase it? If it is to ask them to reduce it, I would think this is certainly contrary to our agreements with New Zealand at
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the time of our joining the Community. Can the Minister explain also the part of the Statement which reads:
" We again made it clear we would not accept any sheepmeat régime that failed to give a net benefit to Britain or included intervention ".
I do not quite understand what that means.
I should also like to know if we are simply living from six months to six months on our regulations for import of meat into this country to avoid the desperate disease of swine fever which is still about. In conclusion, I would ask the Minister if his right honourable friend is engaged in a permanent war with the French. There does not appear to be a communautaire spirit, because time after time he seems to rejoice in the fact that he has put it over on the French. Perhaps we could disguise it a little and say that we are more communautaire than the French instead of more successful.
4.7 p.m.
Earl FERRERS: My Lords, I am grateful to the two noble Lords for the welcome they have given to the Statement. The noble Lord, Lord Peart, asked if we had got the balance right with the 5 per cent. devaluation. He will know more about this than I do because he was a Minister of Agriculture. The balance is always a difficult thing to achieve. We think we have got it right. The noble Lord, Lord Mackie, referred to bank overdrafts and how these are going to be a terrible imposition on farmers, and I entirely agree with him. The 5 per cent. devaluation does at least compensate in part. Of course it does mean that in the long run some food prices are likely to go up a little, but not very much. As an example, butter may go up by about 3½p per lb over a longish period of time. This is precisely the kind of situation that he himself was in, or his successor was, last April, when it was decided to devalue the green pound by the same amount.
The noble Lord, Lord Peart, asked about hill farmers. He will recall that my right honourable friend has recently announced a substantial increase for hill farmers, both for sheep and for cattle, which amounts. if I remember correctly, to something like £20–6 million. That was announced about two weeks ago. The noble Lord also referred to sheepmeat, as did the

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noble Lord, Lord Mackie, and both noble Lords referred to the position of New Zealand. I entirely agree that it is essential that New Zealand's interests are protected in this matter. All we have agreed to is that the Commission should have a negotiating mandate for voluntary restraint; in other words, they are permitted to negotiate with New Zealand and other countries for some form of voluntary restraint. There is not an imposition that there should be restraint, and it is not an indication that the thumbscrews are going to be turned on New Zealand. All it is is a permission to negotiate.
The noble Lord, Lord Peart, also referred to France and the illegal position as regards the French not allowing imports of British lamb. He asked why nothing was done about it. The French tried to establish that further legal proceedings should be held up pending the negotiation of a Community r½gime on sheepmeat. It was my right honourable friend who did not accept that. We have always accepted—indeed, the Commission has accepted—that the French are acting illegally. The Commission is taking the matter back to the European Court. The French wished that that action should be suspended until such time as a sheep-meat regime had been agreed. My right honourable friend and the Commission did not accede to that request.
The noble Lord, Lord Peart, and indeed the noble Lord, Lord Mackie of Benshie, referred to swine fever and asked what was being done about it. I should like to make it clear that we have animal health regulations in this country which prevent the import, and quite correctly so, of animals from other countries which do not have certain clean bills of health. What we have achieved as regards this negotiation is that that derogation should continue for at least a further six months.
The noble Lord, Lord Mackie, asked whether we were continuing a perpetual war with the French. I should hope that there would not be such descriptions as "war ". There is a little disagreement here and there over fairly fundamental issues. We wish to see them acting legally over the imports of our British meat, and we do not intend to act illegally in the same way as they do. In the end the
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success of the Community and the success of the Common Agricultural Policy will depend only upon all the members of the Community acting in harmony together. It is our desire to see that the way in which that harmony comes about is not unfavourable to Great Britain.
Lord MACKIE of BENSHIE: My Lords, can the Minister answer the question about the gap as regards the green pound?
Earl FERRERS: My Lords, I knew that there was something more substantial that the noble Lord, Lord Mackie, said. Indeed, he has raised a number of substantial matters. He is quite right in saying that the gap was 9 per cent. It is now 3.5 per cent.
Baroness FISHER of REDNAL: My Lords, what the noble Earl has just said might be very welcome news for the farmers, who are a minority of the people in Great Britain. However, one would accept that the consumers in Great Britain—and they in the main are the housewives—comprise the majority. As regards mention of ¼ of 1 per cent., the noble Earl gave us some idea of the increase in the price of butter that was foreseen in the near future. The price of butter is a bone of contention, as the noble Earl clearly understands, in view of the amount of butter which is held in intervention by the EEC. So, while the British housewife might feel that the farmers are doing very well out of it, she will be quite concerned that once again, in spite of all the butter that is held in intervention, she will have to pay I think the noble Earl said another 3.5p on a pound, which in view of all the other increases in gas, electricity and so on might become the last straw. The noble Earl gave the figure for butter. Can he this afternoon give figures for any other increases that he expects the consumer—the housewife—will have to bear in this kind of devaluation of the green pound which will no doubt be of help to the farmer but will be of detriment to the consumer? Can he give us the increases in any other prices besides that of butter?
Earl FERRERS: My Lords, I would respectfully reject one inference which the noble Baroness, Lady Fisher of Rednal,

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has suggested—namely, that because the farmers are in a minority, the effect on the majority should be taken more into account. In the long term the interests of the producer and the consumer are the same. If the farmers do not and cannot make sufficient money they will simply not be able to provide the food which the nation requires. The noble Lord, Lord Mackie, referred to one particular matter this afternoon as regards the bank rate. Indeed, if the noble Baroness were to look at figures for agricultural output in terms of income, she would see that they have, in fact, gone down. With respect, they went down I think, during the period of the Government which she supports. We want to see that situation reversed. Inevitably, if we allow prices to increase a little, somebody must pay. This relatively modest sum is available in order to enable farmers to increase their income modestly.
The noble Baroness asked what other figures were available for prices which were likely to increase. Cheese may go up by 3p per pound; beef by 4½p per pound; and bread by one-third of 1p a loaf. If she thinks that that is a great deal, which of course she is entitled to think, she should realise that our predecessor, under her Government, did precisely the same thing in April because he thought then that it was necessary that farmers should have an increase in theft income and that it was necessary—and this is what our Government wish to do—to bring the green pound more into alignment with reality and that it should be less over-valued than it has been.
Baroness FISHER of REDNAL: My Lords, I should like to raise one further point. How does the noble Earl interpret one-third of 1p on the price of a loaf in terms of retail figures?
Earl FERRERS: My Lords, of course, prices do not go up by one-third of 1p. Somebody has to absorb them. Either it goes up, presumably by a halfpenny or one penny, or it does not go up at all.
Lord SAINSBURY: My Lords, I wonder whether the noble Earl can enlighten me about how many devaluations have taken place during the last 12 months, because I think that that would put the matter in much greater perspective?
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Apparently we are only considering today's devaluation and its effect on prices, but there have been three or four devaluations, think—without looking up the record—during the last 12 months.
Earl FERRERS: My Lords, I am bound to say that I speak from memory as regards this matter, but I think that the noble Lord's Government devalued the green pound by 5 per cent. in March. We devalued it by 5 per cent. in June; then 1·1 per cent. in September and now another 5 per cent. The reason, of course. is that when the value of the pound slips this becomes necessary. I would remind the noble Baroness, Lady Fisher, that, if she is concerned about the rise in the price of food to the housewife—about which we are indeed all concerned—the Retail Price Index went up by no less than 122 per cent. during the last five years.
Lord CLEDWYN of PENRHOS: My Lords, is the Minister of State aware that, subject to what my noble friends have said about increased prices, there are considerable remaining problems? Can he be rather more precise about the increase in real farm income which will result from this 5 per cent. devaluation? Secondly, rather more broadly and fundamentally, can he say to what extent the Government are still hoping that there could be a more radical reform of the Common Agricultural Policy? Is there not a danger that we go from package to package—and I am not expressing this as a view of any one political party—mollifying this sector or that sector, but failing to impress upon our partners in the Community that we shall not come to a satisfactory conclusion until we have a real reform of the Common Agricultural Policy? Can the noble Earl say what hope the Government have of achieving that?
Earl FERRERS: My Lords, the noble Lord, Lord Cledwyn of Penrhos, has of course put his finger exactly on the difficulty. We accept that there should be some fairly substantial reforms of the Common Agricultural Policy in order to prevent the kind of thing which we are at present witnessing and in order to make sure that there is a better agricultural policy. But, like all things which are described as "common" agricultural policies, there has to be common agreement, and the difficulty is to get eight other

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people to agree with one's own point of view. That is bound to be a slow process. It is bound to be a process where, from time to time, one feels that not a great deal of success is being achieved. However, we intend to continue with it in order to try to reach a more successful outcome than we have at the moment.
The noble Lord asked whether I could give any indication of how farmers' incomes would be affected. That is always a difficulty, because it depends upon the price at which commodities are sold, which are not necessarily the prices that are indicated by intervention prices or target prices. On the whole, it is expected that the devaluation will make a gross improvement to farmers' incomes of £235 million; but of course there will be additional costs, such as feeding stuffs, which are likely to be in the nature of £85 million. This will leave a net improvement of about £150 million. I would explain to the noble Lord, Lord Cledwyn, that that figure does not represent the increase in intervention prices, but it is the figure by which it is anticipated farmers' incomes will increase.
Lord KALDOR: My Lords, in any radical reform of the Common Agricultural Policy will the noble Lord agree that farmers should receive guaranteed prices by some means other than by making the food consumer pay, as is the case in this country?
Earl FERRERS: My Lords, the great difficulty is to get the supply and demand in equilibrium and in balance. What we would wish to achieve—and this is perfection—is that that which is required is produced and that there should not be any surpluses. But the nature of life is that if we are not to have shortages in some years, we are bound to have surpluses in other years. The dramas created by shortages are, with respect, infinitely greater than the dramas created by surpluses. Perhaps I could give the noble Lord one example. About four years ago potatoes were in short supply not only in England but throughout the Common Market countries. Prices simply rocketed from £40 a tonne to £230 a tonne. The complaint then was that consumers were having to pay too
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much and farmers were making a fist out of it. Of course, the following year prices came down and things were different. Therefore, when there is a shortage the effect is infinitely greater than when there is a surplus.
Lord GLENKINGLAS: My Lords, will my noble friend accept my congratulations on what he is doing to defend the farming community from sometimes rather unfair attacks by the other side—that everything is being done for the farming community and not enough is being done for the consumer? Will he bear in mind that this winter has only just started?
Lord PEART: My Lords, I hope the noble Lord will appreciate that I never said that; indeed, some of the critics did not. I recognise the importance of the farming community and of having a healthy agricultural system.
Lord GLENKINGLAS: My Lords, if I may refer to the noble Lord, Lord Peart, as my friend, I was obviously not referring to him when I said that certain comments had been made. His comments were very much more balanced, as one would expect from a former Minister of Agriculture.
But I return to the problem that this winter has only just started, and as far as weather and other things go it has started extremely badly. The noble Lord, Lord Mackie of Benshie, reminded my noble friend that farm incomes last year fell by more than 11 per cent. and that at present the expectation from the same source is that they will fall by a larger amount this year. The farming community is grateful for the help that it receives through this devaluation, but I merely want to put on record that in no way will this reverse the fall in farm incomes in Scotland, and most certainly not in the hill country.
Earl FERRERS: My Lords, I take my noble friend's point, but unless we draw this discussion to a close, we shall be embarking on an agricultural debate. Perhaps, with your Lordships' approval, we might return to the debate on which we originally embarked.

THE RESERVE FORCES
4.25 p.m.
Debate resumed.
Earl CATHCART: My Lords, I return to the Motion of my noble friend on the effective Reserves and I agree with the noble and gallant Lord, Lord Carver, that in 1966 the Territorial Army was under-recruited and contained a great deal of dead wood. However, as I shall try to show in a few minutes, I think that it was over-pruned at that time. I believe that there is a need for a moderate and gradual increase in our Reserve Forces, mostly for security purposes in the United Kingdom base, but also in order to provide Reserves for our Forces. I also believe that the will exists to man those additional Reserve Forces. I do not share the pessimism of the noble Lord, Lord Shinwell, that the necessary leadership in this matter will not be forthcoming.
Effective Reserves are an essential component of a sound defence policy. As the noble Lord, Lord Shinwell, said, we usually give Reserve Forces a mention in our annual defence debate, but they receive only a passing reference. Therefore, we must be particularly grateful to my noble friend Lord Glenarthur for the opportunity which this short debate this afternoon gives us to concentrate our attention on this subject.
Regular Reserves of the Army account for 68 per cent. of the total Regular Reserve Forces of all three Services, as the needs of a reserve manpower for the Royal Navy and the Royal Air Force are much less. The 1979 Statement on Defence Policy, issued shortly before the general election and which is the most recent one available for reference, indicates that the total number of Regular Army Reservists had risen since 1975 from 107,000 to 124,000 as at 1st January this year; whereas the total number of Reservists for the Royal Navy and the Royal Air Force—albeit of a smaller quantity—during the same period had fallen slightly. No explanation was given in the Statement for either this rise or the fall.
I wonder whether the noble Lord who is to reply to the debate will tell us whether the total number of Reservists for the Army has now reached its ceiling, or whether we can expect it to continue to increase at the same pace for a few more
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years? Furthermore, can he say whether the fall in the Reserves of the Royal Navy and the Royal Air Force is a matter of anxiety. Have our operational commitments been reduced by a similar amount and, if not—as I suspect is the case—what steps can be proposed to fill that gap?
I have often had the feeling that such large numbers of Reservists in peacetime were just statistics maintained on the tiles of some branch in the Ministry of Defence, and that if an emergency came leading to mobilisation many would not be available for one reason or another, or would be unfit. Therefore, we must especially welcome the arrangements recently announced in another place by the Minister of Defence—which have been referred to by my noble friend Lord Glenarthur—and as forecast in the 1979 Statement on defence, that Reservists will be called up from time to time in order to confirm their availability, to check their fitness and their continuing suitability. I should like to see these arrangements developed still further so that each Reservist receives from time to time—say, every four or five years—a short, 48-hour refresher course in new weapons and equipment and improved techniques relevant to his particular branch of the Service.
In 1914 the full brunt of fighting in the opening stages was borne by the Regulars. In 1939, although many territorial units and Reservists were deployed in theatres of operations at the outset, the phoney war gave time for them to settle down. If ever hostilities or mobilisation happen again, it is unlikely that any such respite would occur, and many civilian soldiers would be immediately involved in operations. There is a tendency to refer to all civilian soldiers as Reserves, whether they be Regular Reservists now returned to civilian life or whether they are members of the Territorial Army.
The 1979 Defence Statement tries to have its cake and to eat it in this respect, since Chapter 2 confirms that after mobilisation 70 per cent. of Army Forces would be deployed on the European mainland, and that in order to enable the Army combat Forces to complete their commitments to NATO many Reservists and Territorial Army would be needed immediately to bring the British Army of the Rhine to the required strength. Yet

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Table 2 of Annexure H of the same Statement, which deals exclusively with Reserves, lists the total number of Reservists and members of the Territorial Army as Reserve Forces.
The point I am trying to make is that individuals, or units, drawn from Regular Reserves, or the Territorial Army, who have a specific operational task to go to either in the United Kingdom or on the European mainland are not reserves in the strict sense of that word. Perhaps we should call them reinforcements, since on mobilisation they immediately reinforce our combat Forces to bring them to an effective war footing. To "maintain effective Reserve Forces", in the words of the Motion of my noble friend Lord Glenarthur calls for sufficient men and units from the TA and from the various types of Regular Reserves who are uncommitted—that is the key to the word "Reserve "—to any particular immediate operational task. They should be, as the word" Reserve " implies, available to strengthen a particular combat requirement where the initial deployment has proved to be inadequate.
Secondly, they should be available to deal with any unforeseen contingencies, which somehow always seem to recur. Thirdly, they must be available to replace casualties. Bearing in mind these large numbers of Regular Reservists and TA who are committed to an immediate operational role, and if your Lordships accept my supposition that these should not be regarded as Reserves, then I believe that our genuine Reserve manpower needs to be increased if they are to meet effectively the unexpected. Since the number of Regular Reservists depends on the size of our Armed Forces, this increase must be found, as many of your Lordships agree, I know, from the Territorial Army.
I should like to see a gradual and a moderate increase in the number of Territorial Army units. I believe that the enthusiasm of the general public can be found, can be inspired by leadership if they see the need for it. I am certain that there are valuable tasks for them to do and train for. Therefore I should like to see it restored. I should like to see it restored gradually, because there will be problems in finding sufficient leaders, officers and
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non-commissioned officers, and also drill halls to accommodate them in. Nevertheless, that is something that we must do.
My final point concerns compensation awarded to a member of the Territorial Army, or his dependants, for injury or death occurring on training. If certain units of the Territorial Army are going to be required to carry out important and immediate operational tasks on mobilisation, their training must be realistic and they must have the opportunity of training to the same standards as the Regular Army. Accidents will occur, and especially on night exercises. Your Lordships will remember the case of the TA soldiers who were drowned in the River Trent on night exercises about two years ago. Then the unconvincing ruling was given that the Ministry of Defence was not responsible for compensation, but that it was a matter for the individual civilian employer based on his civilian career. Many young men in the TA are not yet eligible for civil employment compensation schemes, as they have not worked for that employer for long enough, and others, too, of course may be unemployed. I hope very much that this Government will continue to give urgent consideration to that problem, and that they will agree that it really must be a Ministry of Defence responsibility for that compensation.
4.37 p.m.
Lord CLIFFORD of CHUDLEIGH: My Lords, when I first joined your Lordships' House in 1964 I happened to be a Territorial Army ADC to the Queen. This was an honour which was given to some of us who had commanded Territorial Army battalions and been deputy brigade commanders too. In 1965 we first heard the rumblings of the carving knife being sharpened on the Healey Grindstone. We then started a whole series of debates, culminating in that cut taking place. I continued non-stop protesting them, and I have ever since. In every defence debate that has taken place I have hammered this point of our lack of reserves. I can assure the noble Lord, Lord Glenarthur—and the noble Lord, Lord Shinwell, said it as well—that there are those of us in this House who have continually battled on on this question of inadequate Reserves.
Just after the noble Lord, Lord Shinwell, came to your Lordships' House I first

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had the good fortune to get in close touch with him, and I am honoured to have been in close touch with him ever since on all questions of defence. After the first debate on defence that followed he came up to me and said, "Young man, the thing that has worried me more than anything else about our defence situation is our lack of Reserves ". From that date I may say that my connection with the noble Lord has dated. May I go back a little further leading up to a story about the noble Lord, Lord Shinwell. When I was commanding a TA battalion over 20 years ago, I had a young officer, a captain, who was then a journalist on the Western Morning News. At about the time that I gave up command he moved to London and became a junior and then later a senior lobby correspondent for the Daily Telegraph. He is now a Euro MP. I mention this because he was very useful to me, especially when I first became honorary secretary to the noble Lord, Lord Shinwell, on the all-party Defence Study Group. There was quite a lot of publicity in our local paper as well as nationally at the time.
It so happened—this is the story I want to tell—that that announcement appeared in the Western Morning News just before I had to go to see my predecessor as honorary colonel of the Royal Devon Yeomanry about a personal matter, and he told me this story about Lord Shinwell when he was Minister for War; and I hope that the noble Lord, Lord Strathcona and Mount Royal, will follow the example of Lord Shinwell at that time. The Minister came to address the Territorial Army Association in Exeter. He made his speech and this friend of mine—the father of two well-known sons, I might mention, one an ambassador and the other a major general who has just flown to Rhodesia to be in charge of the monitoring forces—told me that at the end of his talk to the TA Association, Lord Shinwell asked, "Do any of the commanding officers have any questions they want to ask me?" My friend, who was commanding a TA gunner regiment, told the then Minister, "I have so many 16 and 25 pounders "—whatever the figures may have been—" and I have only 10 quads to draw them ". The Minister consulted the bureaucrat seated beside him and replied," When it comes to specialist equipment, it is more difficult ".
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My friend then said, "I happen to know there are hundreds of them littering the autobahns in Germany ". "Is that so ", said the Minister, and without again referring to the bureaucrat seated beside him he replied, "Indent again for your quads, and write to me if you do not get them ".
After that, my friend telephoned the staff captain in the South-West District and was told by the captain, "I told you they are not available ". Whereupon my friend replied, "I have been told to write to the Minister if I don't get them ". The captain replied, "You can't do that ", but, not deterred, my friend said, "I have witnesses who will say I must write direct to the Minister ". Not only did my friend get the quads he wanted; he got two more within a matter of weeks. I hope that the noble Lord, Lord Strathcona, will follow that example of Lord Shinwell and cut through his so-called advisors.
I hope Lord Strathcona has his pencil ready because I am now going to tell him what I want for my mob. First of all, we need an assistant training officer; he is on establishment but we have not had the position filled. We need more regular assistants, and I am now talking about a TA home defence unit. In my county there are three drill halls for the squadron 70 miles apart and the regimental headquarters is 140 miles away. How can one expect a company squadron commander, with those distances to cover, to be able to do that as well as all the various other things he has to do? For example, he had to do seven CCF and ACF inspections last year. In my day we had regular training majors who could do that. Now we do not have enough, so one cannot expect them to do that sort of thing.
Home defence units of the TA are equipped with four-by-two Bedford trucks, and that is absolutely ridiculous; once they get off a metal road they are up to their axles in mud. They must be given four-by-four vehicles as soon as possible. I mentioned wireless sets the other day in a supplementary question; we have been promised adequate, more up-to-date ones for over two years but we have still not got them.
I turn from the particular to the general and I want to concentrate on home and civil defence reserves. It is generally

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accepted that we will be the first, not the last, country to be attacked if the balloon goes up. We are the staging platform for all the Reserves coming from the North American Continent, yet we have no adequate home defence—what we have is less than a small crowd at Twickenham, as one noble Lord said—and our civil defence is non-existent.
When we had National Service, a strong TA and the civil defence, there were no problems because that automatically gave us Reserves for everything. The Conservatives, to their utter shame, abolished National Service, and to my way of thinking, from that time stem all our Reserve problems; and of course Healey and Callaghan then went and abolished the TA and the civil defence. It is no use crying over spilt milk, so let us try to do something now for home defence. Though the most important, the home defence TA thinks it is the Cinderella.
As I have previously told your Lordships, I am chairman of a civil defence organisation called the Devon Emergency Volunteers and we are trying, through volunteers, to fill some of that gap. It is difficult to get training equipment, but we at least have got somewhere where other counties have got nowhere. Some time ago the Minister told me there would be a Statement on this subject. I now hear through a member of that organisation who is also a Member in another place that we are not to get it for about six months. The recent Easingwold Conference resulted in the usual platitudes, and I remind the noble Lord of what his party said about this when they were in Opposition: that we should remember that in a crisis, for our Servicemen, be they in the North Sea, flying over Italy or fighting in NATO, it is of great importance that adequate home defence facilities should be laid on. It is of great importance for the morale of the Services, but at present they know we do not have it, and anybody who does not believe me can refer to General Hackett's book.
Let us do something now, and I suggest that as far as civil defence is concerned, speaking from experience, we should begin by taking it away from the Home Office and putting it under the Ministry of Defence, which would help both finance-
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wise and equipment-wise. The County Councils Association is already on record about the misuse of the 75 per cent. home defence grant. Any defence-country, home, civil—will be sacrificed by the bureaucrats and their local politicians for vote-catching and things of that nature. Remember too, regarding bureaucrats, Parkinson's Law: do not let your civil defence, or any other defence organisation, get caught up in the bureaucratic control of voluntary organisations.
I only ask the House to remember what trouble can come to other organisations; one thinks of how for years there was trouble between the Police Federation and their excellent reserves, the Specials. Time is not on our side; 1983 is supposed to be the year when the peak of advantage of Russia over NATO will be reached. We must act now.
4.48 p.m.
Baroness VICKERS: My Lords, I am pleased to be speaking in this debate, and I am really intervening on behalf of the women's Services. But, first, I want to tell the noble Lord, Lord Shinwell, that we are grateful to him for having an all-party committee, and I would suggest that, when we have the White Paper on Defence, we might have a discussion with noble Lords in all parts of the House joining in; it is not satisfactory when only one or two take part from the Opposition Benches. We should have a general discussion, not a debate, because it is vitally important that going out from this Chamber is one mind on this issue, especially in regard to the present state of NATO, and I hope I may get some support for that suggestion.
I want to say a few words about the Auxiliary Territorial Corps (ATS) which was formed in 1939, because they do not really know what their future position is to be. I have studied the Journal of the Royal United Services Institute for Defence Studies and the report of the conference held on 7th December, 1977, at which three very important persons from the three Services spoke. Yet I can find no mention of the role of the women in the future. Recently, in October, there has been a recruiting campaign. Perhaps the noble Lord, when he winds up, would care to say how successful it has been. The corps must know what they are going to do in the future.

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Our Reserve Forces are very different from those of the Republic of Germany or of France, not only because they are voluntary, but also in regard to the position of women in these Services. At the present time when there is need women, particularly from the medical services, are called up because the Royal Navy and others are very short of medical personnel. What is to be the position regarding British Forces in Germany and assistance towards the security of the British Base? Is the 1967 decision still to apply in future? Will it therefore be the women who will be on duty for the security of the British Base?
In the Expenditure Committee Report in 1977 the days of moving territorial formations of greater than basic unit size to the Continent at the outset of a conflict were assumed to be over. Does this still hold good? It is rather important to know this. Has there been a change of policy?
It has been suggested that the British Army, while retaining the strength of the TAVR system, could move, in relation to those who volunteer for its Regular Services, to a system involving recall during the period of reserve liability. Would this mean a great change in the present system? As I understand it, the present situation is that there are two armoured reconnaissance regiments; the Artillery have two medium and three light air defence regiments, making five in all; the Engineers' regiments total seven; the Honourable Artillery Company comprises one, the Infrantry 38, and Special Air Service Regiments two. Are these the numbers at the present time? If the noble Lord cannot answer this question today, perhaps he will let me know later on.
I now turn to what is to be the role of women in the future. Their present jobs are merely clerical, cooking, working as stewards, in signals, and driving, none of which is a really skilled occupation. Therefore we do not get the really skilled people coming into the Services. I suggest that it is important that we try to get a better standard of recruit. When one remembers the excellent work that they did in two world wars, I think that they deserve to know what their future is.
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I understand that at the moment it is much easier to recruit Service women than officers because the officers do not feel that they have enough work to do of great importance, and their equipment is poor. I should also like to suggest that some of these people, particularly those on, say, Salisbury Plain, should go to small towns such as Devizes, Chippenham and Warminster and get more young recruits, as I gather that from the age of 17 they can join the Army Cadet Forces. A great many young people have literally nothing to do in these small country towns, and I think that the Services, particularly perhaps, the Women's Services, could be advantageous in stopping delinquency. I know that a great number of youngsters would like to join the Services, but when it comes to actually joining invariably they are turned down because their educational standard is not high enough. or it is thought that they do not have enough personal knowledge; and this is a great blow. I know of four young men in my village who have been turned down in circumstances which I think were a pity. If they had had a little training and some occupation beforehand, they might have made very able recruits.
4.56 p.m.
Lord WIGG: My Lords, I am glad of the opportunity to speak in the debate. I congratulate the noble Lord who initiated it on providing the House with this opportunity. I probably find myself in almost complete disagreement with all that has been said, but I am afraid that I cannot help that. I do not expect anyone to take any notice of what I say, or even to listen to what I say. I have been saying the same thing now for so many years that I have given up attending the defence debates because I do not want to bore. But it is a fact that this debate, in terms of national defence, is completely and utterly irrelevant.
Let us assume that if the occasion arises in which the Reserve Forces are called upon to play an active role, it would bring them, in a matter of hours, either into conflict, or to the possibility of immediate conflict, with—so we are told by the experts on Soviet strength—the greatest military power on earth; men who are produced from a military machine, following long periods of training, equipped down to the last button. What we propose to put against them are the new-named Terri-

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torial Army and Regular Army Reservists, many of whom will have left the colours years before. Overall they will have been inadequately trained and inadequately equipped.
Let us look at the proposition. We were fortunate yesterday to have been given in another place a dictum from our greatest military expert, the Prime Minister. She said:
" The greatest danger to any country is weakness in defence".—[Official Report, Commons, 11/12/79; col. 1072.]
All right—that is the test. Now the day comes and the Reserve Forces have to be mobilised. The noble Lord, Lord Clifford of Chudleigh, has given us some evidence. A unit of which he had knowledge in the West Country was spread over immense areas in penny packets. This is not exceptional. Even in London Territorials are spread all over, from Fulham to Barking, from the North of London to the South of London; and they have to be brought together in a matter of hours, turned into fighting units and transported to Germany, to face—on the basis of the evidence from the other side—highly sophisticated, highly trained regular soldiers. I do not believe that that can be done. The noble Lord, Lord Shinwell touched on the point.
The turning point of course was the 1957 White Paper—I apologise for saying this again—and that was a political document. It was designed to save the Government of the day from the embarrassment in which they found themselves. It was a very severe embarrassment. Let us apply Mrs. Thatcher's test to a Conservative Government who have been in power not for months, but for years. Their first Minister of Defence was the great Churchill. They had Field Marshal Lord Alexander as a Minister of Defence. I looked up—I have a good memory, but I believe in checking—what was said on 5th December, 23 years ago, by a distinguished Conservative Member of Parliament, well-known to the noble Lord, Lord Boothby, the late Captain Charles Waterhouse. He was not a Left-Wing ideologue, but a Right-Wing imperalist in the old-fashioned sense. This is what he said—and remember the test, my Lords, when the Prime Minister said that the greatest danger to a country is defence weakness;
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" The fact remains that when this crisis came "—
it did not come like a thief in the night, there was two months' or more warning—
" we had no plan, no ships, no aeroplanes and no men available in sufficient quantities to hit quickly ".—[Official Report, Commons, 5/12/56; col. 1303.]
On the moral of this Mr. Macmillan could not get Lord Head to do his dirty work. He got the noble Lord, Lord Duncan-Sandys, through the 1957 White Paper to do the job, which was to get rid of conscription. We were going to have nuclear forces in its place. Skybolt—where is Skybolt? Blue Streak—where is Blue Streak? When there was no Blue Streak and no Skybolt, we had Polaris. and we are still lumbered with Polaris. I am not going to argue the case today; I have done it often enough. Polaris is fit only for Steptoe and Son—an obsolete weapon. Often there is none of them at sea at all.
The obligations into which this country has entered in terms of NATO can be discharged only through compulsory military service. There is no other way. If you turn your back on compulsory military service, then all you do is to escalate the bill to the point where you cannot afford to buy the equipment. So you now have more women and children on the payroll of the Ministry of Defence than you have soldiers, sailors and airmen. Let us face the fact—and there is no denying that fact. Therefore, if you step up your Reserve Forces and you want to take them to Germany, how do you take them?
Let us come down to the present day. The Territorial Army has to be transported to Germany. There are available Puma aircraft. The Puma was ordered by Mr. Healey. It could have been conveyed by the Belfast. The Belfast was built to fly Blue Streaks, but there were no Blue Streaks. The only cargo it could carry was a load of ping-pong balls. That is now obsolescent: and we have no carrier aircraft that can lift a Puma. Yet the Puma is your battlefield transport helicopter. These facts are as well known to the Russian intelligence as they are to me. They are known to the Government, and they are known to noble Lords on all sides of the House. To come here today and suggest that by titivating round through publicity campaigns, that by added recruitment. one is going to be

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able to solve this problem. I just do not believe it.
The point is, my Lords, that I hold a completely different view about defence from that of other noble Lords. I believe the Russians, as indeed they are, are Marxist. The best way to do us down is to get us to spend money on defence, because the greatest single inflationary cause in the Western World is defence expenditure. It is wholly non-productive. So the present Administration says, "Come February, increase defence "—one up to the Kremlin. This is going on throughout the Western World: and whenever there is a sign of pacification the Kremlin rattles the sabre and we pour a few more thousand million pounds on defence. Yes, go along and spend £5,000 million on the Trident, just to make absolutely sure that inflation goes on. So far as the Russians are concerned, to them defence is totality, not only in terms of equipment but right across the hoard. This will go on until they can get you to be sensible, and they do not think you will become sensible because the vested interests in the country against the body politic behaving sensibly are very great indeed. Therefore, there is a guarantee of more expenditure on defence, more inflation, basic economic weakness. If any noble Lord believes that the Kremlin shivers in its shoes at the strength which is expressed in that White Paper, all I can say is that they are greater optimists than I am. I am filled with foreboding. I believe the chips are down, and you may be called upon to catch them perhaps quicker than you know. So far as I am concerned, I continue with my warnings. I do not expect you to listen, but a future Gibbon, if the place does not burn up, may get amusement from reading them.
Lord BOOTHBY: My Lords, before the noble Lord sits down, may I ask him one question?
Lord WIGG: Certainly.
Lord BOOTHBY: My Lords, does he think it is a pity we ever gave up compulsory National Service? Because I do.
Lord WIGG: My Lords, if I may say so to the noble Lord, it is like a gramophone record with the needle stuck. I have been saying that since 1957. I am sorry the noble Lord has not listened.
Lord JACOBSON: My Lords, before the noble Lord sits down, could I follow on the question of the noble Lord, Lord Boothby? When we had compulsory National Service for a number of years after the war, was it not a fact that the Army did not quite know what to do with the—
Several noble Lords: Order, order!
Lord SANDYS: My Lords, I think the noble Lord is out of order.
5.5 p.m.
The Earl of AVON: My Lords, it has been my (shall I say?) privilege to follow the noble Lord, Lord Wigg, quite constantly in this House, sometimes on gambling and sometimes on defence. If I may, I should like to return rather to our Reserve Army, and leave the battles of the world to others. It might interest the noble Lord, Lord Wigg, to recall that the birth of the Territorial Army after the war was really in 1957, when conscription ended, because up until that time people were drafted into the Territorial Army, and the real volunteer force started only in 1957.
I should like to follow my noble friend Lord Cathcart in one or two remarks about the old Territorial Army, which was dismissed, I thought, rather with a sweep of the brush by the noble and gallant Lord, Lord Carver. I thought it was a very good army. I had the privilege of commanding a battalion in the Territorial Army from 1965 to 1967, and then I commanded a battalion in the TAVR shortly afterwards. I was inspected by the noble and gallant Lord, Lord Carver, when I commanded the battalion in the TAVR, and I hope he found it efficient. But I think he would have found my old TA battalion efficient, too, and I wish he had inspected that one. It might amuse your Lordships to know that my new battalion had one or two differences from the old one. I was given a staff car and a driver, an ambulance and six minibuses. None of this had I asked for in the old TA; all of it came in the new TAVR. To save money, was it, my Lords?
I should like to thank my noble friend Lord Glenarthur for raising this subject today. I think it is a very opportune moment to have a debate on the Reserves.

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The present Government have changed the name and changed the atmosphere between the Government and the Reserve Army. At a recent meeting of the Territorial Army Council, held only last week, which was addressed by the Minister, the Under-Secretary from the other place, Mr. Barney FIayhoe, it was quite clear that the Territorial Army is now excited by its future. I should like to take up one more point which my noble friend Lord Cathcart mentioned, and that is the matter of compensation for widows of members of the Territorial Army. This is a matter which exercises the members of the Territorial Army very much. I understand that this is now the subject of a tri-Service study group. We should all like an undertaking by the Minister to ensure that this does not get put under the carpet, as it were, but is expedited as much as possible, perhaps not with the backdating of such benefits as we hope may come about but, anyway, by making sure that the date is a realistic one.
I know that it is the Government's wish to encourage the TA, and that the Government would be willing to expand the Territorial Army. It is argued that there is no need for expansion because the Territorial Army is not fully recruited. But there is a flaw in this argument. The Territorial Army has a diverse establishment because of its role in support of BAOR. The teeth arms are often 100 per cent. recruited—sometimes a little more, sometimes a little less. I cannot see that the Territorial Army as it is now conceived can ever be 100 per cent. recruited because of the difficulty in filling some vacancies in logistic units and, in particular, the medical units. The noble and gallant Lord, Lord Carver, mentioned this. Therefore, the argument about reaching 100 per cent., although it will always be present, is not in my opinion valid.
I should like to see the teeth arms monitored carefully, and whenever there is, say, a 110 per cent.-recruited battalion, the possibility of expansion explored. It need not be initially forming a new battalion, but perhaps just a company. A policy of flexibility would be ideal. I believe there is always a role for increased teeth arm troops. We need not get too Whitehall top-heavy about what these roles should be.
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I hope we shall never again see a poor-cousin role whereby they are under-equipped or under-established compared with the present Territorial Army. If a new company is formed, I see it becoming a training company in title, although the commanding officer should be given discretion. This would go a long way towards answering the criticism that, because of the large turnover in the Territorial Army, many of their number will always be under-trained. If a new battalion is formed, I see their role in rotation on an annual basis with a sister battalion committed to BAOR, with the alternative role being deployment in the United Kingdom, should mobilisation ever happen. What I believe is that units should never turn away volunteers to the teeth arms but that the Government should actually and actively encourage over-recruitment with the carrot of expansion. Nobody can crystal-gaze into the future and say that these trained men will never be necessary. I would welcome a policy of flexibility in this field.
No noble Lord has touched on the Army Cadet Force. I should like to mention them. They are an excellent recruiter for both the Regular and the Territorial Army but there are two particular spheres in which they have been left behind. The first is identity cards and the second is their rank structure. Believe it or not, if an adult is wearing the uniform of Her Majesty's Forces he is not able to identify himself with an ID card. There has been a case of cadets entering a military establishment and, when challenged, being unable to identify themselves in the normal fashion. This is humiliating. I am told that there would be administrative difficulties. Surely it should not be impossible for the adult to draw out his ID at the commencement of a weekend and hand it back at the end of training.
The question of rank is one of history. All cadet officers are substantive lieutenants so that you get the farce of a lieutenant colonel wearing the uniform of and being in all sense and performing as a lieutenant-colonel while in the Army List he is a "lieutenant (acting lieutenant-colonel) ". Cadet officers have become used to this anomaly but—and this is why I should like to see this changed as soon as possible—it can discourage officers transferring into the cadet force. A TA or Regular

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major is in some cases jibbing at this paper degradation even if he maintains his rank in public. It is, anyway, an unflattering demotion. As these officers are the very instructors we should encourage to join the cadet force, this unfortunate anachronism should be removed. My Lords, we look forward to my noble friend the Minister being in his present office for many years. I am sure the ACF would be grateful if he were to look into these problems.
5.13 p.m.
Lord DUNLEATH: My Lords, I, too, am grateful to the noble Lord, Lord Glenarthur, for having given us the opportunity of this debate this afternoon. I have four brief points which I should like to mention. Some of them have been referred to already. First, we welcome—and when I say "we ", I speak as a member of the TAVR Association—the improvement in the bounty to TA members; but inflation being what it is, I think it ought to be reviewed periodically, perhaps once a year, to keep pace with inflation. There are still a significant number of people who lose money when they go off to camp for a fortnight every year. Secondly, I understand that Her Majesty's Government are looking into the matter of compensation for part-time soldiers to bring them into line with regular soldiers. I welcome that and I hope that they will be able to expedite implementation of it, because part-time soldiers are just as vulnerable to accidents as are regular soldiers; and their families suffer every bit as much in the unfortunate event of their being permanently injured or killed as do the families of regular soldiers.
Thirdly, I think that unremitting efforts should be made to keep employers aware of the role, the significance and importance of the Reserve Forces. Some employers are very good. Very often, when I was in the TA—and that is going back 10½ years—you would find that the employers who seemed least likely to be able to do so were the ones generous enough to pay their employees when they went off to camp. I think that employers need to be kept informed continuously as to the role and purpose of the Reserve Forces. One must recognise that a small firm can suffer quite considerably if a large proportion of its workforce is in the same Territorial regi-
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ment and they all go off to camp at the same time. This often happens, particularly where you get one or two men at foreman level, who are the sort of material that staff sergeants or sergeant-majors are made of. If they are looked up to by the others and they join the TA, quite a few colleagues in their firms may join as well; so that an employer employing a couple of dozen men may find some eight or 10 of them away at the same time. This is hard on the employer. I wonder whether there is any way in which Her Majesty's Government could assist firms who are in that particular dilemma.
Finally, I should like to commend all those who give up their spare time to serve as part-time members of our Reserve Forces and, in particular, I should like to salute especially the members of the Ulster Defence Regiment, who are at risk not only on duty but even more so when off duty. Particularly at risk are those whose civilian employment involves a certain routine, postmen, milk roundsmen, bakers' delivery men and so on; because the unspeakable terrorists have a pretty good idea of what particular place they will be passing at a certain time every week day; and they are soft targets. It can take a lot of courage to write your signature to enrolment in the UDR if you live in certain places. I was lucky when I was in the Ulster Defence Regiment because I lived in a comparatively peaceful, comparatively non-sectarian and highly-civilised part of the Province, so that I had not too much to worry about. But there are certain places where the men or the female soldiers, the "Greenfinches ", and their families can never relax. They are under threat all the time. I commend and salute them most heartily.
5.10 p.m.
Lord INGLEWOOD: My Lords, although I am tempted to speak about the Territorial Army in which I served for many years, including the whole of the war, I want briefly to echo some things which were said about civil defence at Question Time on 6th December. As has been stated already by the noble and gallant Lord opposite, there is little that can be done at the start of war unless there have been major preparations of a quite different nature from those we have today. If you allow that there is little to be done in the first 20 minutes, there

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will yet be a need later to try to preserve life, to reduce chaos and then to start reconstruction. Any noble Lord who saw Belgium collapse in May and June 1940 will never forget it. The horror of the refugees, the misery, the fires, the blocked roads and the breakdown of all the services could have been much lessened if they had only had better civil defence preparations.
I want to mention just one or two examples. I told the noble Lord who is to reply that I was going to speak on these lines, so I hope he will be able to say something in reply. First, is there any plan to revive the Auxiliary Fire Service? The professional fire service—that is, the regular fire service—in this country could never be brought to the strength to deal with all the emergencies such as those we have in mind this afternoon. I know there is, or was, a certain amount of equipment, and a lot of it was brought into use last winter and manned by Servicemen. At the beginning of the outbreak of hostilities there will be no Servicemen available for tasks like that. Who is being trained to man this equipment again?—that is, if any of the equipment survived the ordeal of last winter and was thought worth putting back into store. There are other countries in Europe which I know attach great importance to the Auxiliary Fire Service, for example, Austria and Denmark. We should look at this very seriously.
Then we come to the heavy squads or rescue squads—whatever they were called in the civil defence world. We cannot expect the Sappers to clear all obstructions and open roads for general communications. They will have other things to do more closely associated with Army commitments. If there are no squads with appropriate equipment for clearing major obstructions, how are ambulances going to move about? How would any fire engine get to the scene of a fire? I should like to know from the Government whether they have any plans for trying to revive such squads. It cannot all be left to private contractors, for they will not have the special training.
Then we come to the police function, which was mentioned by the noble Lord, Lord Clifford of Chudleigh. Again, the regulars would never be able to meet all
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the demands in an emergency. I do not believe it is generally known that here in this country we have no regular police reserves. It may be more difficult for us to recruit and organise regular reserves than in a country whose police follow the gendarmerie pattern. None the less, that is no reason for having let the small reserve that we had before the war dwindle away to nothing. I do not believe there is a single police force which today continues the system of first police reserve, as I think it was called. They were regulars or ex-regulars with part-time commitments. I should have thought it would be possible to ask young men who leave the police force below a certain age to undertake commitments rather on the lines of the Territorial Army. There could be short refresher courses and they could undertake short periods of service when they were particularly needed. That is a stystem Which is quite familiar to us from experience with both the Regular and the Territorial Army.
Last but not least, I want to say something about the Special Constabulary to which the noble Lord, Lord Clifford of Chudleigh, referred. It is, I believe, something unique to this country to have such a service in all parts. There are other countries which have something similar but only in certain towns or districts, while we have a Special Constabulary covering the whole country: 23,000 unpaid volunteers with no national organisation and hence no national voice. I submit that today they are far from happy. They are the Cinderella in this whole picture that we have been painting here this afternoon. The Special Constabulary should be of immense value to this country. It is unhappy to have to say that they are held back by the Home Office and the regular police. If I am wrong, I hope that the noble Lord who is to reply will tell me.
It would seem entirely up to the chief constables—not the Government—as to how far Special constables are recruited and encouraged or whether they exist at all. From my reading of the 1964 Act, it is possible for any chief constable to decide that he will dispose of or dismiss his entire strength overnight. If all chief constables decided to do this we would wake up tomorrow morning and find the entire force had disappeared. Of course, chief constables are not accountable to the

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Government or Parliament for operational duty, although they are accountable to the courts, but I believe that if they abolished the force, they would not be in breach of their statutory responsibilities.
Joking apart, chief constables have not done well by the Special Constabulary, and they must take responsibility for the present state of the force. The Police Federation has been hostile to the Special Constabulary, and still is, and most chief constables—they are only human—would prefer to avoid stirring up the Federation, if giving open encouragement to the Special Constabulary was going to result in trouble.
I do not wish to be unjust to any of them, but, if any chief constable has come out boldly on a public occasion in favour of developing the Special Constabulary in his area, and has said that he is going to give them exciting training and duties within their ability, I have never heard him, and I doubt whether any other noble Lord here tonight has either. I know of one or two chief constables who have come fairly near it; but there are others who have done just the minimum. Some have done well; others have not done well at all.
Meanwhile, the Home Office hides behind the recommendations of a very ill-fated working party which ought never to have been set up on the basis that it was and which reported two years ago. The recommendations are already out of date and the special constables are very unhappy about some of them. This is all such an important field that I hope your Lordships will agree that it is one where on some future date we could have a full debate all on its own.
5.25 p.m.
Earl FORTESCUE: My Lords, I hesitated before adding my name to the list of speakers to this very valuable debate because I served in a Reserve Force for only a few years. That was a long time ago and that particular Reserve, an Air Force one, has long since been disbanded, for the reasons which my noble friend Lord Glenarthur mentioned earlier. However, I should like to make one point and offer one suggestion. First, the point: I was recently fortunate enough to go to Germany with a parliamentary party to
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visit the British forces there. I had the opportunity of talking to the commanders and other senior officers. Happily, the story they told was a very different one from the one which the noble Lord, Lord Wigg, told this House this afternoon. As has been mentioned already, on mobilisation BAOR would rely not only on the return of units from Northern Ireland, but on immediate reinforcements from the Territorial Army. These territorials now go to Germany at regular intervals and train with the units with which they will fight in an emergency.
Your Lordships will know that professionals are all too reluctant to give due praise to amateurs. However, in this case I was deeply impressed by the vital importance that these officers attached to their TA reinforcements. They know them well and emphasise how efficient they are and how immediately valuable they would be in an emergency. This is surely high praise coming from senior officers of such an excellent force. I submit that this should add a lot of weight to the case for increasing these Reserve Forces.
As to my suggestion, this concerns the areas in which territorial units are recruited and trained. As an example, I know the North Devon Yeomanry which between the wars became the Royal Devon Yeomanry. It now provides a squadron. for the Royal Wessex Yeomanry which has its headquarters in Cirencester. Cirencester is well over 100 miles away from Barnstaple and the regiment covers three or four counties. It is now therefore a regional unit rather than the county unit that it used to be. I gather that it is a very good regiment, and the last thing I want to do is to decry it. But apart from the administrative, training and social advantages of each regiment occupying a compact area, I believe that county loyalties still mean a lot to most people and help to produce a good regimental spirit. The noble Lord, Lord Clifford of Chudleigh, will correct me if I am wrong, but I strongly suspect that many Devonians have never heard of the Kingdom of Wessex, unless they joined the Yeomanry.
My Lords, for these reasons, I suggest that county identities are given careful consideration if the Reserve Forces are further expanded as I think they should be.
5.30 p.m.
Lord PEART: My Lords, this has been an interesting debate and a debate which has been worthwhile. I thought at first that it could easily get bogged down, but, no, I think we have had an excellent debate. Many of the points that have been raised are very germane to the problem, and I believe that on another occasion we should return to this subject. I was going to discuss the Shapland Report. I read it carefully through last night—I did my homework—but there has been very little mention of it today; so I hope that one day we shall come back to this subject.
If I may say so to the noble Earl, Lord Fortescue, regarding his visit to Germany, I think he is a little unfair about the noble Lord. The noble Lord, Lord Wigg, is a realist in the best sense. He is very loyal because of his own Army experience and he is anxious to have adequate defence. I think the only criticism that could be made of the noble Lord, Lord Wigg, is that probably he repeats the argument again and again—but he may be speaking the truth. All I would say is: Let us listen to him. In the sphere of Army policy he is like a breath of fresh air and you need a critic of that kind.
May I say about the noble Lord, Lord Inglewood, that he raised a most interesting aspect of defence. He has been not only a distinguished serving soldier but also a Territorial, and in the field of local administration he has played a major part in the North of England. He made the point that we need to have a police reserve. There may well be considerable opposition from the chief constables and the Police Federation. The noble Lord also went on to talk about the Special Constabulary: there are 23,000 of them and they are badly paid, the Cinderellas of the Service.
Lord INGLEWOOD: They are unpaid.
Lord PEART: Unpaid, my Lords: I am sorry. That is even worse. This is a matter for the Home Office and I hope that the noble Lord who is to reply to the debate will take up the interesting point that has been made.
I should like to congratulate the noble Lord, Lord Glenarthur, on having introduced this subject for debate. I am sorry I missed a few remarks at the beginning of his speech but I listened carefully to the
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rest of it. He should be congratulated and we owe him a debt. His speech was a fine and good one. He dealt with the trained Reserve and the need to train regularly. He also talked about wider aspects and about the Soviets' increasing ability and the considerable strength that is arraigned against us. He came out unhesitatingly in support of a 3 per cent. increase in defence expenditure, and of course of the need for forces pay increases. I could follow his speech further in detail, but I will read it carefully in Hansard.
May I say to the noble Lord, Lord Dunleath, that I am glad he paid a tribute to the Royal Ulster Constabulary. 1 know Northern Ireland—I am sorry the noble Lord has gone, but I hope he will read the tributes that have been paid to him. The Royal Ulster Constabulary have done yeoman service.
I come now to the speech which I think mattered most of all and that is the speech by a former Minister of Defence, the noble Lord, Lord Shinwell. I agreed with it so much. He dealt with the Reserve Forces and argued the need for those forces and for a strengthening of them. We should not be difficult because there is an opinion in the country which is not sympathetic to defence. I thought it was like a breath of fresh air. I have heard the noble Lord speak in many places as well as in the other Chamber, when he was Minister of Defence, and he has never altered and never wavered. He has been a great patriot and I pay tribute to him. His speech was refreshing.
He talked about the lack of enthusiasm; he went back to the Government of 1945, to the position of National Service and to a period of international tension. He pleaded for continuous support. After all, as he argued, we are in Europe and have obligations to NATO. Therefore, inevitably we come up against nuclear weapons and missiles. The noble Lord went into great detail and said that we had many experts in this House. Of course, we have. Many speakers today have had either some experience of the Territorials or some experience of being Regular soldiers in the last war; and so we have a wealth of talent. The noble Lord, as I say, talked about experts. May I just remind your Lordships of what Veblen, the great American sociologist, said: that experts sometimes have a trained incapa-

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city to think. Therefore, I hope that the noble Lord will not be too over-whelmed by the problem of experts giving advice, which may or may not be good.
I quickly turn to the noble and gallant Lord, Lord Carver, who talked about the reorganisation of the Territorial Army. He thought some of it was very ineffective. I thought that was a bit too hard on the Territorials, a volunteer army. I know he is a very distinguished soldier, but I think he had got it wrong there—perhaps I am wrong and he is right. He dealt with the problem of sabotage, particularly as regards air defence and civil defence areas, which are sensitive. I agree that we need to increase security: that was an important point to make. It is essential that we should have efficient internal security at RAF stations and establishments, and indeed at military establishments in different parts of the country. Civil defence, I think he said, should be a matter for the local authorities to look at and we must have a catching up of civil defence. He is probably right there. I now come to the noble Earl, Lord Avon, who has had long experience of the Territorial Army. I thought he made an excellent contribution. He mentioned how his battalion saved money—I was rather amused at his having Army vehicles pressed upon him which he did not want. Somebody should have had a rocket about that, and I hope they did.
I have been asked to cut short my speech, and in any case I always feel that a short speech is better than a long one. So I would say to the noble Baroness, Lady Vickers, that I thought she was quite right when she said there had been no mention of the role of women. After all, women played a major part in the last war, and not just in connection with making armaments or shells for the troops. I can remember having my first practice shoot as an anti-aircraft gunner down in the South-West and there, working the predictors, were university girls from Queen's University, Belfast. Later I saw some of those self-same women in different parts of the country really taking part in the action. Their place was not abroad, but they played a most important part in the anti-aircraft system we had at that time. And of course there were the WRNS: the noble Baroness is a great defender of the WRNS.
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I am cutting my speech now because we are going on to another important debate and it would be wrong for me to waste time. I think we have had a very good debate and I hope we shall come back to this topic at a later date, when perhaps the Government will give us a full day for it. I hope we shall not have to wait until the debate on defence. I think we should spend a full day on this, and after the noble Lord and his colleagues have read Hansard it should be possible for us to make that debate a good one. I hope the Minister will be constructive: he always is. I wish him well in his job. I am certain it must be most exciting to be a Minister in the Defence Department. I never wanted to go to Agriculture and I should have loved to have been in Defence-but, anyhow, an Army marches on its stomach.
5.40 p.m.
The MINISTER of STATE, MINISTRY of DEFENCE (Lord Strathcona and Mount Royal): My Lords, perhaps if the noble Lord, Lord Peart, could change the nature of his politics, he might yet find himself in a very exciting job which I can assure him this one is. I should like to start by echoing his remarks in congratulating the noble Lord, Lord Glenarthur, not only on the concept of having initiated this debate, but on the manner in which he did it. I think we might say that he reflects credit on his Army training for the way in which he marshalled his facts, and for the clarity of his exposition.
Also, I cannot let the opportunity pass without thanking and congratulating noble Lords once again. Defence debates are outstanding for the shortness and the crispness of the speeches which we have in them, and today has really been a remarkable example in the number of speeches of under 10 minutes. It is something that I frequently try to emulate, with total failure, and I am sure that this evening will be no exception.
However, I believe that this debate will contribute in an important sense to the wellbeing of our Reserve Forces, in that it will have helped to focus public attention upon the vital role of the Reserve Forces. The noble Lord, Lord Glenarthur, rightly drew attention to this point, which was picked up by the noble Lord, Lord Shinwell, in the question that he asked on 4th December, and I believe

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that there are few better ways of giving publicity to this point than initiating debates in this House. I entirely agree with the noble Lord, Lord Peart, that this is a subject worthy of a separate full debate on its own, rather than getting subsumed in a defence debate which inevitably is very wide ranging.
Before I try to answer some of the specific points, I should like to make a few general comments about the size and the organisation of our Reserve Forces. Our election manifesto said that,
"We must maintain the efficiency of our reserve forces ",
and then it also said,
"We hope to increase their strength "
Since coming to office, this Government have restated the importance which we attach to defence. We are proud of having done this and I believe we can say that our actions have matched our words. The noble Lord, Lord Glenarthur, pointed out that one of our first acts on coming to office was to restore the rates of pay of the Armed Forces to the level of their counterparts in civilian life. That was the first shot in the campaign.
Lord PEART: My Lords, we did some of it.
Lord STRATHCONA and MOUNT ROYAL: Too little and too late. But even if the regular forces were 100 per cent. manned, we should still need the Reserve Forces to bring the Regulars up to war strength in periods of tension. This is their primary job and I have to say to the noble Lord, Lord Wigg, that we simply do not agree that these Reservists cannot be adequately trained to make a contribution in this way. The Government fully recognise the need to ensure that the Reserve Forces are capable of fulfilling this, their first and vital role.
The noble Lord, Lord Glenarthur, and indeed the noble Earl, Lord Cathcart, distinguished between the two types of Reservists. There are the ex-Regulars, who have a reserve liability, and there are the Volunteer Reservists; that is, the ordinary men and women from every walk of life, who join up because they feel that they have something to contribute to our national security. Before dealing with the volunteers, I should like to say one or
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two further words about the Regular Reserves; and I do not intend to get into a semantic argument with the noble Earl, Lord Cathcart, who referred to the military definition of the word "Reserves". This is not what I believe the noble Lord, Lord Glenarthur, was addressing himself to in initiating this debate. It is a perfectly fair point, but not the one which we are addressing this afternoon.
Regular Reserves are ex-Servicemen who leave the Regular Forces and have a liability for their Reserve Service. But their mobilisation role is different from that of the volunteers. In the Army, the Territorials are organised, trained, equipped, armed and administered as units with specifically defined wartime tasks. But the Regular Reserves, on the other hand, are to supply individual Reservists, both officers and soldiers, men and women, to bring both the regular and the TA units up to their war establishments. A minimal amount of training is needed in peacetime, because these men have all had Army experience, and only those soldiers who had recently left the Army would be earmarked for tasks which required some degree of up-to-date specialist knowledge.
The point made by the noble Lord, Lord Carver, about the updating of the Reserves was, to some extent, answered by the noble Earl, Lord Cathcart, when he called attention to the recent announcement made in another place by my Secretary of State of the mobilisation scheme for Reserves and the individual reinforcement plan. Under this scheme, the Reservists are asked to report in person on one day a year to their specified local unit, so that their records can be kept up-to-date, their fitness can be assessed and their uniform and equipment—that is, apart from the fire-arms—can be inspected. They may also be asked to do a certain amount of refresher training. For this they will receive an annual reporting grant of £100, in addition to their travelling expenses.
But, of course, on mobilisation the Reservists will report either to their local unit or to the local centre which will be dedicated to the reinforcement of a specific formation. We estimate that these new measures, which will involve about 50,000 men, should halve the time required for the mobilisation of the men concerned, and we hope that this will be an important enhancement of the overall effectiveness of our defence capability.

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Several noble Lords referred to the Royal Naval Reserve, which is very much smaller at 5,500. This is primarily to fill the gaps on ships and to provide a much greater margin of manpower than is necessary in peacetime. Then there are the RAF Reserves and here, again, the number of RAF Reservists is smaller than those of the other Services because, as the noble Lord said in introducing the debate, of the highly sophisticated equipment and the associated skills which are needed in a modern air force. But I do not think that the effectiveness should be measured only in numbers. The importance of the RAF Reserves is that they would enable the RAF to function in war at a higher level of intensity and a higher level of utilisation of their expensive equipment, so that they could keep more aeroplanes in the air for longer and more frequently. So much for the Reserves.
If I may, I will now turn to the volunteers; that is, the Territorial Army. There are 60,000 in the Territorial Army and, for the benefit of the noble Baroness, Lady Vickers, that includes the women, of whom there are about 4,000. Their tasks are different but quite clear. They make a major contribution to the reinforcement of the BAOR in an emergency, and they help to maintain a secure base here in the United Kingdom. The Territorial Army's role in BAOR would be crucial to the NATO policy of forward defence and flexible response. The success of such a policy will depend upon the ability of ourselves and our allies to deploy sufficient conventional Forces, including Reserves, who will be readily available at short notice, with the purpose of deterring, hopefully, but if that fails, resisting aggression. The part envisaged in this scenario for the modern Territorial Army is to provide formed units ready to take their place and to fight side by side with the Regular soldiers.
This leads me to the question of equipment. The Territorials cannot do their job unless they are given the proper tools of their trade. It has been said that they are second-class citizens. The noble Lord, Lord Clifford of Chudleigh, described them as a Cinderella. This may have been true in the past when the role, as I think the noble Lord, Lord Carver, pointed out, of the Territorial Army was different and when its size was very much greater.
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The tendency then was to give them cast-off equipment from the Regular Army. Since the 1967 reorganisation, it has been Army Board policy to provide the Territorials with the most modern equipment available and, ideally, with the same equipment as that of the regular units which have a comparable role. So when new equipment is introduced into the Army, provision is normally made for the Territorial Army as well. In general, we depart from this principle only when an item of equipment is considered to be too sophisticated to be given to the Territorial Army because of the training time needed to exploit it.
I should not pretend that this policy has been wholly attained, but we are on the way. May I give to your Lordships a few examples of the modern equipment which the Territorial Army will be receiving over the next few years. The Yeomanry Regiments will receive the latest reconnaissance vehicles and the personnel carriers and the ambulances. That is the Scorpion range of tracked vehicles. BAOR units will be issued with the latest anti-tank missile system—that is, the Milan. In some cases, Territorial Army units will be getting them before Regular units which have a home defence role. Some of the Royal Artillery Volunteers are very shortly to be getting the 105 mm light gun and a start has been made on the vexed question of communications equipment. The Clansman radios are coming in—obviously not so fast as we would like, but they are on their way. The Blowpipe air defence missile is already being issued to some Territorial Army units. If one takes all these together, they represent a substantial improvement in the capability of the Territorial Army which will have greater mobility and a very much improved anti-tank and anti-aircraft performance, along with the much needed better communications. The cost of this package—and it is not an exhaustive list—will be well over £100 million.
Most of the equipment which I have mentioned is for use in the BAOR role, but we have not forgotten the general reserve battalions, whose role is home defence. Perhaps they have felt themselves to be even more the Cinderella of the Territorial Army, but improvements in their weapons—in communication equipment and in transport which I announced in the defence debate on

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26th June—are now coming to hand. But I cannot pretend to be satisfied about this. I hope I shall not be upsetting the noble Lord, Lord Shinwell, by being complacent. I assure him that we are not complacent. With this in mind, we have set in hand a special analysis of equipment requirements for the whole of the Territorial Army. This is aimed at identifying the options for improvement, and we are going to compare most carefully the equipment scales for the Territorial Army with those of the Regular Army. Clearly, equipment is only one part of the equation. Perhaps it sounds like a truism—nevertheless, it is worth repeating—that the best weapons in any Army are the men who serve in it. It would be idle to pretend that we have not had problems in the past in holding on to the trained manpower in the Territorial Army. Here again, without wishing to be smug, I believe that we can take credit for having moved fast and taken action to reverse the trend. We believe that the most important thing, as with the Regular Army, is to get morale right.
With a view to improving morale, we have moved as fast as possible towards putting into effect the Shapland Report which I am delighted to hear the noble Lord, Lord Peart, used as his bedside reading last night. The main recommendation of the report concerned the increases in bounties. Some volunteers now get £300 a year in addition to their pay. And we have reverted to the name "Territorial Army". The noble Lord, Lord Dunleath, raised the very fair point about keeping the bounties up-to-date. We are determined that they shall not be eroded as they were between 1975 and 1979. The plan is to have an annual review of these bounties so that this erosion is not repeated. We intend to review the present rates at the end of this financial year. There were some 40 proposals in the Shapland Report, most of which have now been implemented. It is too early yet to say whether this has been effective but we believe that the signs are encouraging. The retention rate in the Territorial Army has improved. We have had more inquiries, and enlistments are increasing. I am glad to say that some volunteers who left the Territorial Army intend to reenlist. I noted the point made by one noble Lord—I do not remember exactly
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who it was—that those units whose success rate in recruiting is high should have their establishment increased. We believe that this is only the beginning of the process. There is quite a long way to go. The Territorial Army is currently 17 per cent. below establishment. This was a point which was raised by the noble Lord, Lord Leatherland, when we debated this question the other day. We have about 61,000 men against an establishment of rather over 73,000. But we confidently hope that this gap will shortly be bridged.
One of the recommendations of the Shapland Report was that the Government should encourage their own agencies—that is, the nationalised industries and other parts of industry and commerce as a whole—to follow the attitude of the Civil Service Department towards Territorial Army membership by their employees. I have said before that we fully accept the importance of achieving a generally favourable attitude towards Territorial Army membership on the part of employers. This was another point to which the noble Lord, Lord Dunleath, in particular referred.
We wish to encourage employers to translate this into positive co-operation by allowing time off to attend camp and annual courses, although we do not underrate the difficulty of achieving this. We intend to continue to impress upon employers the importance of the Volunteer Reserves to the successful execution of our defence policy and the priority which the Government attach to maintaining its efficiency, and anything that noble Lords can do to assist us in this respect will be appreciated. Certainly the greatly Government intend to take every opportunity to try to get this message over both to employers and to trade unions. In this context, I can say that in next year's recruiting campaign we intend to ensure that sufficient money is made available to maintain the momentum in the Territorial Army recruiting because our aim is to provide at least as much money in real terms as was spent this year.
One rather specialist question which was raised by the noble Earl, Lord Cathcart, by the noble Earl, Lord Avon, and by the noble Lord, Lord Dunleath, was the matter of compensation for attributable death or injury. It is true that at present benefits paid by the Ministry of Defence in respect

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of a Reservist who is killed or injured are less than the equivalent benefits for a Regular. There arc of course reasons for this, and historical reasons. The position of a Reservist is not directly comparable to that of a Regular. Nevertheless, we are aware that for some time this has been a matter of concern to Reservists and to the Council of the TAVR Associations. As a result we are now conducting a completely fresh review of the Reservists' schemes and among other things this will consider whether their pensions should be more closely comparable with those paid to injured Regular Servicemen or their dependants. In other words, we are working on it, my Lords.
The volunteer Reserves of the Navy are trained in peacetime for a number of specific tasks. In the case of the Royal Naval Reserve they include minehunting and minesweeping, the naval control of shipping and the augmenting of major shore establishments and they are backed up by the Royal Naval Auxiliary Service and the Women's Royal Naval Reserve and of course the RNR also helps with the local defence of ports and anchorages and the manning of port headquarters.
The Royal Marines Reserves' main wartime role is the reinforcement of the Regular corps. Some 8,500 men and women belong to the Navy's Volunteer Reserve and this too is somewhat short of strength but we hope that these forces will also benefit from the increased bounties being given to the Territorials. But there is only limited scope for providing the Naval Reserves with their own equipment and, as the noble Lord, Lord Glenarthur, said, to counteract the increased threat of mine laying in deep waters a new class of ship which has been called by some genius by the almost unpronounceable tongue-twister, the extra deep armed team sweep trawlers, is being procured. That is one case where initials will be a great relief.
The noble Lord has already drawn attention to the important enhancement to the RNR which was announced on the 20th November, which is the creation of the RNR air branch. They will have two roles: first, to maintain a reserve to augment the front line squadrons of the Fleet Air Arm in anti-submarine and Command) assault roles, and secondly to provide a pool of expertise (although it will be somewhat limited) for communications
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flying. This reserve will be restricted to recently retired Fleet Air Arm pilots and observers and their training will be mainly of a refresher flying type
As I have already said about the Air Force, they have the smallest volunteer Reserves as they do regular reserves. There are only 450. The obvious reason for this is the sophisticated and complicated nature of the aircraft they are operating. The role of the Volunteer Reserves, some of whom would be trained for particular tasks, for example intelligence and photo-interpretation, is to fill minor shortfalls in war manning requirements. We think this is a sensible approach and we think it is a flexible one, as we have demonstrated. On 1st July we formed three squadrons of the Royal Auxiliary Air Force Regiment for a three-year trial. It is a curious fact that it is always quite easy to recruit into the RAF Regiment—easier than into the Army doing an equivalent role. I do not know what it is—perhaps the uniform is more glamorous. Anyway, these squadrons are going to be recruited to provide ground defence support for their parent stations and they will be organised and equipped in a field role as Land Rover mounted infantry. They will have a strong fire power and full-scale radio communications. This has got off to a good start and if the experiment is a success we believe it will be an important new contribution by the Reserves to the overall effectiveness of the RAF. The noble Lord, Lord Glenarthur, made a number of useful suggestions for further expansion of this kind. I do not think I can really comment on those today, beyond saying that we shall examine his ideas, and the ideas of others, with interest when we come to read this debate.
Finally, the noble Lord, Lord Carver, and the noble Lord, Lord Clifford of Chudleigh, drew attention to questions of home defence and they identified some of the weak points there. This point was also made by my noble friend Lord Inglewood, and I am sorry that I did not hear the whole of his speech. We recognise and believe that this general area is where more could be done. We have a number of studies in hand, but of course it also involves other departments so it is necessarily a somewhat complicated matter and I assure the noble Lords,

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including the noble Lord, Lord Peart, that this is something that will not be overlooked.
In conclusion, I should like to try to sweep this matter up by summarising our attitude to the Reserve Forces. In spite of anything that the noble Lord, Lord Wigg, may say, we are convinced that they have an important role to play, both in the central region and in the direct defence of the United Kingdom. We recognise that they must be kept up to strength, they must be enthusiastic, they must be well-equipped and, above all, they must have the full support of the community which they serve. I have no doubts about their enthusiasm and I can assure the noble Lord, Lord Shinwell, that we in the Government share the enthusiasm. We hope that their strengths will increase as a result of the improvements made following the Shapland Report. We shall make significant improvements to their equipment as our resources allow, and as I have already said we are doing what we can to encourage employers to release the men for annual training. But I revert to where I started, by saying that publicity for all of this will be invaluable and debates such as this are exceedingly helpful, and I am grateful to all the noble Lords who have contributed to the debate.
Lord INGLEWOOD: My Lords, before the noble Lord sits down, can he not say a few words about civil defence, and particularly the police aspect of this, that I mentioned, because they are important and I did give warning that I should raise the matter.
Lord STRATHCONA and MOUNT ROYAL: My Lords. I am in some difficulty. This is a question which the Government recognise they have to study. It is quite a complicated issue, as the noble Lord knows very well and the noble Lord, Lord Peart, mentioned. For example, the police are a matter for the Home Office and not the Ministry of Defence. Criticisms have been made in the past that overall responsibility needs to reside in one department or another, and the noble Lord himself has had experience of knowing that anything that involves more than one department is never a simple matter to resolve.
Lord GLENARTHUR: My Lords, it has been a privilege for me to have had this chance to initiate a debate on the Reserves. All that remains is for me to thank very much all the noble Lords who have taken part in it and have contributed so much towards it. The debate has highlighted some areas where there are strengths, and others with weaknesses. Nevertheless, the noble Lord has given us cause to be encouraged and we shall all be grateful for that. Therefore, I beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

NORTHERN IRELAND: ECONOMIC AND SOCIAL PROBLEMS
6.10 p.m.
Lord UNDERHILL Lord UNDERHILL rose to call attention to the grave economic and social problems of Northern Ireland; and to move for Papers. The noble Lord said: My Lords, a number of noble Lords have questioned with some puzzlement why I, a man of Essex and a Londoner, should be moving this particular Motion this afternoon. Perhaps I should explain briefly my interest. First, from 1960 I made a number of visits to Northern Ireland in connection with my position as a national officer of the Labour Party, and I accompanied a delegation to Northern Ireland in August 1969 which made that visit only a few days after that ghastly episode of the starting of the bombing and burning in the Province. Since then I have made a number of other visits, including one in 1978 as a member of the Labour Party working party on Northern Ireland problems. I do not set myself up to be an expert on the problems of Northern Ireland—far from it. I would be equally as concerned with any other region of the United Kingdom which had similar conditions, but of course in Northern Ireland there are also special problems. Also, it may be best if these problems, the economic and social problems of Northern Ireland, are put forward by someone who has no direct interest.
I trust your Lordships will share my hope that at some time, and preferably sooner rather than later, politics in Northern Ireland may be able to concentrate on economic and social issues. I also hope that during this debate it may

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be possible to keep clear of the constitutional issues, which will have to be dealt with elsewhere, and, that it may prove useful in setting out the economic and social problems and how they might be tackled. It may be for the convenience of the House if in considering my Motion noble Lords also discussed the Appropriation Order which is to be taken as the next item of business of the House. I understand the noble Lord, Lord Elton, would support this proposal.
Lord ELTON: My Lords, if the noble Lord will give way, I would like to say that this would be perfectly in order with me. It would enable me to speak with great brevity on the order when we reach it, but it would not preclude any noble Lord from returning to that subject should he wish.
Lord UNDERHILL: My Lords, I thank the noble Lord for agreeing with that proposal. The major problem in Northern Ireland is that of unemployment. The latest available figures that I have, for November, are that unemployment in Northern Ireland stands at 11.1 per cent. of the insured population, some 63,000 persons out of work; 12.7 per cent. are males, 8.8 per cent. are females. Unemployment in Northern Ireland is double the level, namely 5.5 per cent., of that for the United Kingdom as a whole. There are, of course, parts of Great Britain which are just as bad, but unemployment in Northern Ireland as a complete region is by far the highest of any region of the United Kingdom. And I understand—I may be wrong—that it is the highest of any region of the EEC. Unemployment has for many years been well above that of Great Britain, and the figures in some individual areas are very alarming. Just look at a few: Strabane has 29 per cent. male unemployed in a population of some 36,000; Newry has over 23 per cent. of male unemployed; Cookstown, also over 23 per cent. male unemployment; and we have Dungannon and Londonderry with 20.8 per cent. and 18.1 per cent. respectively. These are figures for male unemployment.
I am certain that if those out of work in any area are mainly from one particular community this cannot in any way assist in developing good community relations.
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Every one of the 13 travel-to-work areas in Northern Ireland has at least 10 per cent. male unemployment. In Belfast, while overall unemployment is 9 per cent., I understand that in the West Belfast district we have 20 per cent. unemployment. It is a problem of major concern that some 9,500 of those out of work are under 19 years of age. I was looking the other day at a document issued by the Northern Ireland Committee of the Irish Congress of Trade Unions issued only in October this year—and I quote:
"Unemployed young people have too often fallen into the hands of ruthless men of violence who have exploited them and persuaded or bullied them into committing the most atrocious acts of violence".
That is one of the consequences of young people being out of work for a long period.
There has been a decline in the traditional industries of shipbuilding and textiles. It is now being suggested that the workforce of Harland and Wolff will need to be trimmed from 8,200 to 5,500. May I say that "trimmed" is a very nice contemporary word which is being used. What it really means is another 2,700 being put out of work and their families suffering accordingly.
Of course, the performance of the Northern Ireland economy is bound up with the level of economic activity in the United Kingdom as a whole. But, although the population of Northern Ireland is the smallest of any region of the United Kingdom, it has by far the most serious economic problems. There would seem to be common ground among employers and trade unions in Northern Ireland that the economic problems are the most intractable in the United Kingdom. There is general agreement also that the creation and maintenance of new employment depends so crucially upon Government investment and Government incentives. But the immediate outlook for employment seems to be very bleak, and a substantial effort will be required to absorb the increase in manpower that is certain to arise from demographic and other similar factors. There is an urgent need to generate new jobs.
The present level of unemployment is not only a waste of talents and skills but cannot possibly assist in developing good community relations. I referred to this document of the Northern Ireland Committee of the Irish Congress of Trade

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Unions. It is a constructive document put forward by the trade union committee of Northern Ireland, their way of dealing with the economic position and some proposals for new jobs. I find also that the gross domestic product per head is only 80 per cent. of that of the United Kingdom as a whole. Whereas the ratio of public expenditure to GDP in the United Kingdom as a whole is 50 per cent. in Northern Ireland it is 66 per cent. Again, while in Northern Ireland 37 per cent. of all employed people are in the public sector, that compares with 30 per cent. in the United Kingdom. I am making no party political issues in this debate but trying to give what I think are the facts. It seems a very important fact that cuts in public expenditure must have a greater effect in Northern Ireland than elsewhere, with that ratio of people employed in public sector jobs.
When we consider the level of wages in Northern Ireland, we find that, historically, wages have always lagged behind those of the United Kingdom. Household incomes are on average three-quarters of those for Great Britain. The number of children per family is much higher. There are a greater number of poorer families in Northern Ireland than in any other part of the United Kingdom. In 1974 it was reported that 37 per cent. of households in the Belfast area were living below needs level. It is always difficult to talk about average wages. I understand that in the Belfast area the average male wage is about the same as that in Great Britain, but elsewhere in Northern Ireland wages are well below the United Kingdom average. One indication of that is that in 1977 41 per cent. of the males were earning less than £60 a week, whereas in Great Britain the percentage earning £60 a week was only 27 per cent.
Not only is the level of unemployment twice as high as the rest of the United Kingdom, but supplementary benefits are taken up to a far greater extent. We find that there is the same problem with the supply of energy which does not help the economic situation in Northern Ireland. There is a lack of indigenous energy resources and it seems to me an excessive dependability on oil. I understand that only 37 per cent. of the 460,000 households in Northern Ireland are connected with a gas supply. It is also commented that
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the gas industry of Northern Ireland is in danger of complete and utter collapse. There has been pressure for the link-up. of a natural gas pipeline with the United Kingdom, but it appears that that has been rejected. It would seem, also, that the greater part of the electricity generation is by oil. Perhaps the noble Lord the Minister could say how many plants could be adapted for the use of coal as well as oil. There have also been suggestions that the electricity service in Northern Ireland could be linked as a region of the British electricity supply industry. I do not know whether that is feasible.
How practicable is the possibility of restoring the grid link with the Republic, which was blown up in 1975? I am certain that that would be of great benefit to both communities. In fact, should there not be the maximum possible development of functional co-operation between the North and the South? That surely would make not only a valuable contribution towards raising living standards but a valuable contribution towards bringing about a better atmosphere. At present the charges for electricity and gas are much higher than in the rest of the United Kingdom. I recognise that the Government have written off some £250 million of the electricity supply debt, but the charges still remain a serious problem both for the industrial and domestic users.
The same situation exists as regards housing. Indeed, the position is still disgraceful. The Housing Conditions Survey of 1974 reported that one in five of all dwellings were statutorily unfit compared with 7.3 per cent. in a similar survey carried out in Great Britain in 1971. Some 119,000 dwellings—one in four—lacked one essential basic amenity. The Household Survey in 1975 reported that the housing problem in Northern Ireland is bound up with income levels, poverty and unemployment and that some 17 per cent. of all houses are overcrowded. Last night as I was travelling home from your Lordships' House, I heard on the car radio Mr. Gerry Fitt's speech in another place in which he was describing the appalling conditions in his area of Belfast. Conditions are made more difficult in Belfast by the rundown in the housing stock due to demolitions, bricking-up and the moving out of population. I understand that it is estimated that no fewer than 3,400 houses in Belfast alone are bricked-up.

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The level of unemployment and lower living standards undoubtedly contribute to the numbers who leave Northern Ireland Only in June this year the Northern Ireland Development Council stated that some 10,000 people leave Northern Ireland each year and that the typical emigrant was only 20 years of age. That is a tragic situation with a loss of skills, a loss of qualifications and a loss of abilities.
I hope that it will not be thought that I have painted too gloomy a picture. I have endeavoured to be factual with information taken from various reports and statistics; and I have tried to avoid embellishing them with any personal observations. If my figures are wrong, I know that the noble Lord will correct me about them. I know that the previous Government attempted a great deal in the way of industrial development, creation of new jobs and as regards housing and other social services. But the problem still remains extremely serious. There is large-scale unemployment and widespread deprivation for many people. Behind the facts and statistics there are human beings who need help, and only the British Government, with the help of the people of Northern Ireland, can give it. I look forward to the debate and to proposals that may be put forward for dealing with the serious economic and social problems which I have endeavoured to outline. My Lords, I beg to move for Papers.
6.27 p.m.
Lord HAMPTON: My Lords, I am sure that we all welcome this debate on Northern Ireland so ably opened by the noble Lord, Lord Underhill. I should like to say how good it is to have the noble Baroness, Lady Airey, with us tonight. Of course, it is right that we should consider the grave economic and social problems of the Province, but I believe at the same time that we should not forget those factors that give grounds for hope.
Let me be quite frank, following the modesty of the noble Lord, Lord Underhill. In August I paid my first visit to Northern Ireland in company with some of my party colleagues. I still have to visit the Republic. We only spent some 50 hours in the North and I hope that your Lordships will bear with me if I give your Lordships some of the impressions that I received as a first-time visitor.
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Apart from those 50 hours, I can only go by hearsay, what other people say or write. When I speak about matters that we must look forward to, matters which are favourable, I must point out that I am very conscious that I have in no way had to suffer the strains and stresses of what are sometimes just called "the troubles" of the last 10 years. I accept that fully.
As we drove through Belfast from the airport, I was depressed by the areas covered by poor housing, bricked-up shops and, quite simply, slums. I often bemoan the fact that, in a period of great building in England since the war, we have so largely wasted the opportunity to create an attractive as well as a functional environment. People have said that we are building the slums of the future; and there has been much criticism of high-rise flats. But here in Belfast was the real old-fashioned slum which made me realise that our efforts have rid us of at least the worst display of poverty in England. As a great contrast to the derelict rows of houses on our drive through Belfast came the first view of Stormont Parliament buildings standing proudly on the crest of a hill at the end of a magnificent avenue of trees.
We were searched, of course, as we entered our hotel—I think I am correct in saying that it was for only the second time in my life, the first being when earlier that day we had boarded our plane. Perhaps we were lucky, but the rest of our stay was happy and fairly relaxed. At all places we were welcomed and made to feel at home. One alone of the main political parties—and I shall not publicly brand it here—refused to see us. The Young Liberals were to move a resolution at our Assembly in September calling for the early withdrawal of British troops. This party took objection and, although we explained that official Liberal policy in no way supported the Young Liberals, still they would not see us. At a reception most kindly given for us by the Ulster Liberal Party we again met with great friendliness and what I can only refer to as a spirit of pride in and affection for the old Province. People seemed keen to impress on us that, despite all its troubles, here was the only place where they wanted to live. This warm-hearted good humour is something that I do not find comes across in the English Press.

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None the less, I must be honest. Some of us one day went South to the Border where Carlingford Loch separates North from the South. We lunched happily and peacefully at Warren Point and I thought that the Army were keeping an excessively careful watch over us. It was only four days later that the outrage took place there in which 18 soldiers were killed, while South of the Border there was the tragic murder of Lord Mountbatten and members of his family. But at that time we had few cares. We passed close to what is I believe called "bandit country" and were told of a village where not only had some of the men never been employed, but nor, in some cases, had their fathers or grandfathers before them. I am cautioned that this must certainly be Irish hyperbole, but the accepted position is bad enough anyway.
The noble Lord, Lord Underhill, has given us full details and I do not want to repeat them all. We were told that official figures put the unemployment level at more than 10 per cent., or twice the level of the rest of the United Kingdom, and in the case of some black spots it was much higher. I know that the Government realise that this figure is far too high and have in operation schemes for training and retraining. We were told that one of the problems is that when a man or woman has been unemployed for a long time he or she may quietly slip over the edge into the unemployable. We were also told that the percentage of those on low earnings income supplement is four times as high as it is elsewhere in the United Kingdom. Unemployment generally is a grave problem today and if the noble Lord, Lord Elton, can give any details of plans to remedy the situation in Northern Ireland, I should be most interested.
I was disturbed to read in an article in the Sunday Times of 2nd December comments referring to a debate in the other place and "this boredom with Ulster". I believe that a happy relationship between Great Britain, Ulster and Eire is essential in the best interests of all. It seems hard in the extreme that we should be so reviled in some quarters when we are giving economic aid to the Province to the tune of hundreds of millions of pounds each year. What, incidentally, would happen if we
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did withdraw, as urged, and ceased payment of that sum? Disastrous poverty, I suggest.
But, on the other hand, I recently heard it said that of the 10 field marshals whose achievements in the Second World War have been commemorated in St. Paul's Cathedral, six had a strong Irish, North or South, connection. To date I have been able to verify only four cases, but in the cause of freedom even that is no small contribution. I am also impressed by how in one field or another one finds an Irish influence. It was only the other day that I realised that our present Lord Chancellor, the noble and learned Lord, Lord Hailsham of Saint Marylebone, claims descent from an Ulster family. Let us not forget that it is a two-way process and our societies need all the support and inspiration that we can give each other.
Others can speak with far greater knowledge than I of the problems that poverty and unemployment, intensified by bitterness and bombings, can produce. I understand— and I believe that the noble Lord, Lord Underhill, mentioned this—that 30,000 houses have been wilfully destroyed or damaged. Reference was made to the work of the Housing Executive earlier this afternoon. But what seems to me certain is that no real political or social breakthrough can be made without a dynamic will to win through to better times, and a willingness on all sides to make some compromise and genuinely to accept that all men are born free and equal in dignity. Here it is sad to read in an article in the Observer Colour Supplement of 2nd December, entitled "The Need to Face the Truth", that segregation of Catholic and Protestant schoolchildren is still almost complete. Referring to the teaching of Irish—that is, of the whole island—history in schools, the article says:
"There are still two separate and enduring myths. Neither has much to do with historical accuracy or objectivity. One is for Protestants and one is for Catholics. The myths are divisive—the Catholic saint being the Protestant sinner".
I am not certain whether that is an exaggeration, but I should like to ask the noble Lord, Lord Elton, when he comes to reply, whether he can say that the Northern Ireland Education Act 1978—which the noble Lord, Lord Dunleath, steered through our House so ably—is having any effect at all in remedying this divisive

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so-called education. At that time, to my amazement, we were told that a large percentage of parents wanted desegregated education.
I return to our departure from Northern Ireland. As we took off from Aldergrove Airfield on a fine summer afternoon and looked back on that beautiful land, I thought of the expression that the noble Lord, Lord Elton, has I believe used on two occasions: "War in Paradise". I found myself thinking: Why, oh why? As we flew back to Northolt I sat opposite one of the Ministers of State, and as we skirted the southern end of the Isle of Man he asked me, rather unkindly I thought, "Well, have you sorted out all Northern Ireland's problems?" None the less, I remain certain that its problems will be solved given the will to do so.
By chance last week I found in the Library the book about the Province called A Place Apart by Dervla Murphy and published last year. In the final chapter, entitled "Not without hope", comes this passage:
"The outlook is depressing if one thinks exclusively within the timescale of individual lives; only the passing of generations can bring about the profound changes that are needed. Yet depression is curiously inappropiate to Northern Ireland today; although it should be a gloomy place it is not. (Often it can be heartbreaking but that is something different.) Amidst all the physical destruction and mental distress there is an enormous amount of creative energy at work. The essential changes are unmistakably under way and there are exciting vibrations of hope in the atmosphere. Increasingly I tend to view the Troubles as a painful purge that had to be endured by a diseased society as a prelude to a happier era than the North has ever known before".
Those moving words express the thoughts that I had only in embryo. Others with more knowledge than I will point the way with practical measures, but I am sure that optimism and determination are vital. Let us also remember that although Lord Mountbatten was, at the end, brutally murdered, he had visited and found peace and contentment on the West Coast of Eire for, was it, 30 years? It seems generally accepted that it is only a small minority in Ulster or the Republic who seek to follow bitterness with bloodshed. Improved conditions should make for less bitterness; less bitterness will help towards better conditions. The wreckers must not be allowed to prevail!
6.38 p.m.
Viscount BROOKEBOROUGH: My Lords, first, I should like to welcome the noble Lord, Lord Underhill, and his introduction to this debate which is most timely and was very ably presented. I greatly look forward to hearing him again on the affairs of Northern Ireland for, after years of experience, his knowledge is very deep. Looking at him as he turned to sit down, I am not at all sure that I do not see the track of the whip of the noble Lord, Lord Blease, upon his shoulders to make him come and speak here today. I hope that the noble Lord, Lord Blease, will keep cracking that whip because it is a contribution that we certainly value. The noble Lord, Lord Underhill, covered a very wide spectrum and I should like to underline one or two of the remarks he made.
Put in crude terms, the generation of prosperity in Northern Ireland and the generation of jobs unfortunately depend on Government. We are too remote; we have had terrorism for too long for private enterprise to play more than a minor role. We depend enormously on Government aid, whether it be direct aid to an industry or whether it be by public expenditure. That is an unfortunate and unpleasant fact. But I can say—and it is no break from the tradition of continuous Unionist Governments during the whole period—that never was a Unionist Government doctrinaire in its basis of industrial promotion. To that extent, I feel that we must reiterate the need for Government generated prosperity.
The noble Lord said that there was need for functional co-operation across the Border. There is a myth which has grown up that until 1972 no effort was made to have functional co-operation. Functional co-operation existed between Governments in Northern Ireland from its very inception. One has only to look at the co-operation on the railways; on the electrical inter-link, which has been broken as a result of terrorism and the failure on the Government's part to see that the line was protected, and not repaired; on the Erne hydro-electric scheme; on the Foyle Fisheries, and many other things. This could be increased. It is merely increasing a functional co-operation which has existed quietly for all time. In the political sphere in which

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we have grown up, it is right to have a functional co-operation and not shout from the housetops that it is meeting some political end. That is how functional co-operation can be achieved.
The noble Lord, Lord Hampton, in a most moving speech, discussed various problems of his visit to Northern Ireland. If he had come down to County Fermanagh he would have realised that there is nowhere else in the British Isles, or indeed in Northern Ireland, to live except County Fermanagh. I feel, however, that he might have been misled about that village, because, if I understood it, the village was on the Border, and those men are proud. They have smuggled for 50 years, and smuggle they will go on. I maintain there is a university on customs evasion, and any other nation in the world that wishes to go there will learn many a trick of the trade.
To become a little more serious, I welcome this debate. I also welcome the noble Lord's agreement to allow us to discuss the appropriation order. I should like to remind this House once more that in every decision taken by Government there is some rip-off to the terrorist campaign. The prime aim of the terrorist is to create economic chaos in the area in which he operates. Therefore, any decision by Government must be looked at to see how that in fact affects the terrorist situation. The most prosperous area will not have terrorism. That is almost an opposite. Idle hands are dangerous hands. We have seen that too often in the areas dominated by the terrorists. While Northern Ireland is part of the United Kingdom and must suffer with the prosperity of the United Kingdom, that fact about terrorism must be borne in mind and the Government's generosity must be really very great.
I should like to turn to one or two what I would call "nitty-gritty" parts of the administration of Northern Ireland, and they are things mentioned in the appropriation order . The first concerns houses. I apologise to the noble Lord, Lord Hylton, that I was not able to hear his Question and the Answer. My reason is not very adequate. I was entertaining some friends and I could not get in until the second sitting, because the rest of your Lordships had taken the first sitting. I
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think the noble Lord, Lord Blease, was in the same state. Like the noble Lord, Lord Hylton, I should like the Northern Ireland Housing Executive to be more responsive. I was a member of the Government which spawned that organisation. I personally have great regrets about the way it was done. Having said all that, I know many of the people who are in it and I do not know one of them who is not trying to do his best.
They are circumscribed by an organisation which is difficult to make responsive. I understand that my noble friend said that the level of decision for repairs—and this is the area with which I am most concerned, because that is where the Northern Ireland Housing Executive is going to spend more money—is going to be at a lower level. The problem arises because of two things. I can only speak of the area I know. You have a housing manager who is reponsible for 1,000 or 2,000 houses, and he, or she, has a complaint brought to them. This is what happens at present. She then starts a complicated operation; a real bureaucratic mess. She files the complaint. She gets the rudery from the tenant, who says first of all, "This is the first complaint", and can she have it put right. Secondly, she gets the second complaint; and, thirdly, the third complaint; and then maybe the fifth complaint. Once he, or she, has put this into the organisation, they have no control whatsoever of the speed at which the repairs are being carried out, or any knowledge about when they are being carried out.
I cannot see that that is very difficult. I understand that the Northern Ireland Housing Executive has already carried out some pilot schemes in urban areas. I want to ask the Government whether they will go much faster into the rural areas, because in the long run what is going to cause satisfaction is houses quickly repaired. The housing managers have a great deal of ability, but we seem in Northern Ireland to have got stuck with technocrats, Nothing can be done without a supervisor, a repair specialist, or somebody like that, and we go through a whole series. There are 24 paper transactions before it finally goes into the computer in Belfast. I do not know whether it is exactly true as I do not suppose that anybody has accurately costed it out, but I do not think that anyone can deny

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that to put a ridge tile on a roof and finish the whole process and have the whole thing inspected—the ridge tile costing about £3.50—may have cost £70 or £80 to have carried out that particular repair. Surely we ought to be able to simplify the whole of that with a little commonsense, even if the people have not got letters after their names.
There is another matter worth raising. We have decided to sell houses to tenants. That is all right. That is one decision. Why should not we go back to the system we used to have in large areas in Northern Ireland, and certainly in the area which I know best, by which the tenant paid a pretty low rent but was responsible for his internal repairs? Those repairs would be done on time. I feel that we are due for a fairly massive rise in rents shortly, and a large proportion of this is due to the increased costs of these repairs. I am certain that if the tenant was responsible for seeing that a doorknob was put on, that the lavatory was repaired, or something like that was done, it would be done far cheaper, quicker, and further there would he no complaint against authority. We should examine that.
I think we have feather-bedded our tenants to an extent that we have totally failed to service them. It probably sounds wrong to say that we have featherbedded them, because probably in other areas they are entitled to that service. But if they are entitled to that service they should pay for it, and other tenants who are prepared to accept the responsibility of repairing the internal parts of their house should have a lower rent. If one of the philosophies about selling houses is that it removes that particular responsibility from authority, then it must he right to have a different level of tenancy.
The last matter I have to raise is rather peculiar. Noble Lords will know that there is a supplementary benefit attributable entirely for rents. I have discovered that the administration requires that that amount of money is paid into the hands of the man himself, irrespective of the fact that that particular tenant may be in debt to the Northern Ireland Housing Executive for hundreds of pounds. Once he is in debt or has not paid his rent, what do you think he will do with the money he is given? He will do with it what he does with everything else, probably drink it.
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I believe that if a man is in arrears with his rent to the Northern Ireland Housing Executive and is in receipt of public money for rent, that rent should go to the authority and there should be no nonsense about it. I should like an answer from the Minister on that—I gave him notice that I would raise it—because it is an extraordinary anomaly which I do not believe has been of long standing.
I come to our great industry, agriculture. We have a really disastrous situation in the beef industry. Beef is not over-produced, yet from 1974 to 1979 the number of beef cows in Ulster went down by 30 per cent., and in the last four weeks of September and October this year there has been an increase in the slaughtering of cows, female stock, of 76 per cent., and a lot of that has occurred in what I call the marginal areas, which in EEC terms are called the less favoured areas.
The situation today is probably not so had as in Orkney and Shetland, but we have had continuous rain and bad weather for the whole of the last 15 months. There is no fodder and that is why they are going; and there will be a further increase in slaughterings in January when people realise once more that the fodder situation is so dangerous. They cannot afford now to pay for expensive concentrates to feed them. Last year they did, and they did not get recompensed at that time. This spells ill for our farmers, especially those in the marginal lands, but also for the future of our factories. Three years ago we imported hundreds of thousands of store animals from the South of Ireland for fattening and then going to our factories. That supply no longer exists because in the South they kill their own beasts. I should therefore like the Government urgently to make the maximum payments to less favoured areas to stop the slaughter at once in order for people to be able to buy fodder, just as has been done in the islands off Scotland. And there must be some long-term encouragement to people to keep cows for beef, to re-establish the cow herd, otherwise future employment in our factories will be in jeopardy.
One of the reasons why we have had such problems with our beef factories has been that the South has manipulated, with the willingness of the Commission, the intervention system by which, during the

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whole of this summer, they were able to put 50 per cent. of their marketable stock into intervention and take it off the market, while we were able to put in only a very small proportion. My honourable friend the Minister of Agriculture did a fine job in getting us an increased quota, but it is too late. I ask that at all times our factories in Northern Ireland should be on a par with those in the South. Every time we have a green pound change, every time something of that sort occurs, it throws our factories into chaos and cripples our farmers. Once more I welcome this debate and, if it is in order, I welcome the appropriation order.
6.54 p.m.
Lord SMITH: My Lords, if in Belfast today, or elsewhere in Northern Ireland for that matter, I were to follow an ambulance bearing the tragic victim of one of the frequent atrocities that contaminate the whole life of the Province, I would probably eventually arrive at the Royal Victoria Hospital, a teaching hospital of great repute but situated right up against a part of the city with a truly ghastly reputation for violence. Here the hospital staff and those dedicated people who help them try to practise modern medicine beset by problems which are unimaginable by those who have not been to see for themselves.
I have visited that hospital many times, I have many friends in it and I have operated in that hospital many times, so I speak from first-hand knowledge. For instance, a surgeon embarking on what starts as a routine operating list of two difficult cancer cases may quite easily have the second of those delayed while they wheel into his theatre three-quarters of some blameless citizen who has perhaps left an arm and a leg in a devastated shop; or perhaps a child blinded with broken glass; or what was once a human being burnt from head to foot. Perhaps hardest of all to accept without passion, later on the same day there may be wheeled in the perpetrator of the atrocity wounded while trying to escape, and the surgeon, in keeping with the ethics of his profession, has to do the best he can for him too, though at such a time the strict observance of the Hippocratic oath may impose nearly intolerable strains.
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At the end of what started as a routine surgeon's list there may be a widow to interview or distraught parents to comfort and, when a moment can be spared for personal matters, a telephone call home to make sure that a wife has arrived back from shopping and children are home from school. As the surgeon changes and starts for home, instead of a peaceful hospital corridor he will pass armed soldiers, here in case desperate men with guns break in to rescue a wounded comrade. With this violence and the threat of violence as a constant background, doctors nevertheless try to provide a modern, expert service of health care for the community and, as this is a teaching hospital, to train the young.
I do not address your Lordships in this way to arouse sympathy for this beleaguered hospital; that I know is there already. I speak mainly to those noble Lords who might say, "Yes, but there is really nothing we can do". But there are things that can and should be done, and I hope I may receive some support in suggesting that among the social problems of Northern Ireland in the financial stringency in which our Health Service operates today, some special consideration might be given to this stricken Province, and to two quite practical aspects in particular.
To start with, there is totally inadequate provision at this essential hospital for the cars of the staff and of relatives and visitors of those who are ill or injured. If these cars are taken inside the grounds of the hospital there is much obstruction and this affects the work of the hospital, including the access of ambulances. On the other hand, if these cars are left in the street, by the time the owner returns the car will be gone and it will turn up somewhere else in the Province with a bomb inside it. The hospital's plans for a multi-storey car park were approved last year, but this year—unless there are second thoughts—the plans have been cancelled.
Then, again, the hospital experiences great difficulty in recruiting and keeping junior professional staff at the level of medical and surgical registrars, staff nurses and some key para-medical people, without whom the work of the hospital would collapse and stop. This difficulty is not only because the off-duty time is minimal, but also because accommodation

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is so difficult. These key people cannot with safety live outside the hospital but close to it. It is too dangerous; they cannot do this. Yet they must be close to their employment. The hospital itself sought to solve this problem early in the 1970s by building, with its own endowment funds, two blocks of flats which it felt should be subsidised in that those accommodated were of such importance.
At about the time of the reorganisation of the Health Service these flats were taken over by the department, which now acts as a landlord. This is seen by the hospital staff as a reasonable arrangement, but it is planned that on 1st January next the rents shall go up by 100 per cent. This will, the hospital is assured, be a realistic rent. But, my Lords, we are not considering what an estate agent or developer might tell you about realistic rents in Hampstead or Welwyn Garden City. What in all conscience is a realistic rent in the circumstances that I have described for a key member of staff who have will to leave and go elsewhere if asked to pay more than he or she can afford? And remember, these flats are nice enough, but the blocks are surrounded by a two-storey high wire fence which keeps out most of the stones when they are thrown at the buildings, but not the bullets which are occasionally fired.
The ability of the hospital to maintain its services is at stake here. Already at present the failure to attract sufficient supporting staff is preventing the commissioning of an additional neurosurgical operating theatre, and neurosurgery in this hospital today is largely trying to save the lives of citizens shot through the head.
I seek the support of this House in asking the Government to look again with a sympathetic eye and an understanding heart at the needs of a medical community trying to provide a good service under conditions of terrifying stress—in every sense possible, I believe, a special case and deserving not only sympathy, but the help of all of us.
7.3 p.m.
The Duke of ABERCORN: My Lords, I, too, should like to thank the noble Lord, Lord Underhill, for initiating the debate and for his evident, in fact obvious, concern for the problems of Northern Ireland, particularly at this time. I can
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assure your Lordships that the people of Northern Ireland appreciate the ever increasing interest of this House towards the economic, social and political problems of this remote part of the United Kingdom. The economic and social situation in Northern Ireland is indeed extremely serious, with no immediate sign of improvement, due to outside factors. Being involved in commerce and industry, I intend to concentrate on the economic problems which of course have a direct bearing on the social situation.
However, first I should like to counteract a most unfortunate misconception that Northern Ireland has a constant begging howl mentality and lacks the essential ingredients of self-help. Nothing could be further from the truth. Despite 10 years of violence and six years of slow economic growth, industry and commerce have shown a remarkable degree of resilience and determination not only to remain in business but also to expand whenever possible.
Rational co-operation and trust between the two sides of industry could well act as an example to Great Britain, for Northern Ireland has a remarkably low level of industrial unrest, absenteeism and strikes. Our industrial productivity during the past 15 years compares very favourably with Germany and outstrips both America and Great Britain. Yet our unemployment remains at a totally unacceptable level, despite a significant improvement in our infrastructure and an extremely attractive package of incentives to attract mobile industry.
Obviously, Northern Ireland suffers from an image problem in regard to attracting inward investment. Therefore, despite recent and significant successes in attracting new American investment to Northern Ireland, it is only too apparent that the competitiveness of industrial development grants and loans is failing to surmount this psychological barrier to new investment in Northern Ireland.
No industrialists will deny that although there are many factors which may influence an industrialist in choosing a location for his enterprise, the net return after tax is without doubt the most important factor. Therefore, I believe it is of the utmost importance that the recognised and most effective inducement in attracting outside manufacturing investment—a tax-free con-

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cession on all manufacturing exports generated by new investment for a period of, say, 10 years—is seriously considered for implementation by the Government. Let no one in Whitehall pretend that Brussels would block such a radical, but realistic, departure from the normal range of incentives, for Brussels would in fact recognise this proposal as the responsibility of the Government. Moreover, since the Regional Development Fund is so modest in size, it is likely that the Commission itself would be forced to examine means and methods, such as tax-free concessions, to accelerate the industrial development of the super peripheral areas of the Community.
The Irish Republic has achieved its high rate of new industrial development as a direct result of this concession. I believe that Northern Ireland industry could benefit by this build-up of industrial investment by exploiting the very significant sub-contract potential by these multinational companies, particularly in view of our recognised skills in engineering. Therefore the proposal for a Government-sponsored sub-contract office in Dublin should be seriously considered.
My Lords, I am fully aware that cross-border development, even in relation to infrastructure improvements, generates unease and criticism among politicians, but I believe that this development is of the utmost economic and social importance as it is in these border areas that unemployment is so chronically high: Strabane 23 per cent., Newry 20 per cent. Again, infrastructure improvements would provide short-term employment while creating an improved environment to attract industrial and commercial development when the economy improves.
Therefore the Northern Ireland Office should not be reticent in pursuing further projects, and from experience of chairing a study group of the Community's Economic and Social Committee on the 1977 Cross-Border Study for the Londonderry and Donegal area, I can assure the Government that there is tremendous enthusiasm from within the study area for this type of project. Again, my Lords, further Community aid should be forthcoming for similar projects, with additional assistance from the non-quota section of the Regional Development Fund.
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Again, I believe that the Government should publicise far more effectively to Northern Ireland industry the available facilities of the European Investment Bank. To date, this bank has provided only long-term loans for the improvement of Northern Ireland industry and infrastructure to the sum of £73 million. Since June 1978, private sector borrowers have been able to obtain exchange risk cover from the Department of Commerce on European Investment Bank loans for plant and machinery investment. Since the Department of Commerce now acts as the bank's agent to appraise applications, small and medium-sized firms can now benefit and obtain long-term loans at most advantageous rates. I understand that, to date, no application has been received for agency loans from Northern Ireland, while there have been many applications from England, Scotland and Wales.
I also understand that the Government are undertaking a review of the different job-creating agencies in Northern Ireland which are responsible for promoting new employment opportunities. Since there is a proliferation of different institutions, and hearing in mind the small population involved, this review is timely and should be welcomed, since there is a real danger of diffusion of talent and effort. However, I must emphasise that the area of real growth achieved over the past decade has been in the small firm sector.
My Lords, I was a director for some five years of a local enterprise development unit, commonly known as LEDU, which is a Government-sponsored job-promotion agency with emphasis on the encouragement of small manufacturing industry in remote rural areas and, again, in towns of chronic, high unemployment. Since its establishment in 1971, this agency has created almost 10,000 jobs and assisted 500 projects throughout Northern Ireland. LEDU is recognised as a non-bureaucratic, innovatory organisation staffed by a totally dedicated team of professionals and integrated with the local community, with panel offices in Londonderry, Newry and Enniskillen. I trust that LEDU will retain its identity; and I do not speak from sentiment, but in the firm belief that further encouragement to small businesses will provide the best opportunity for job-creation in the 1980s for Northern Ireland.
7.14 p.m.
Lord DUNLEATH: My Lords, it is clear that I made a grievous error in allowing the noble Duke, the Duke of Abercorn, to see the notes that I had written for my speech, because he has just made my speech for me. However, I shall edit what I have noted down. I, too, salute the Government, and the previous Administration as well, for the strenuous efforts they have made to attract industrial investment into Northern Ireland. I sincerely hope that the industries they have attracted, when they get into full production, will prove to be successful, and that the efforts will prove to he fruitful. At the same time, I think one has to bear in mind that these jobs, though desperately needed, are bought at a very high price; and I hope it will transpire that the very large sums of public money which have been invested will turn out to have been justified. One has to hear in mind that, when the economic climate becomes unfavourable, the multi-national firm which has a subsidiary overseas is likely to axe that subsidiary before it closes down its main production plant at home, and this is where there is a certain area of vulnerability. None the less, I wish these projects every success.
What I want to go on to say is this—and I echo what the noble Duke has just said. Small, home-based industries were traditionally the source of our prosperity in Northern Ireland. In the early 19th century, when we got in on the Industrial Revolution act and the Northern Ireland economy started to boom, there was not any money from America then, and there were no Government subsidies then. The entrepreneur had to rely on his own skills and initiative; but, then, there were no hindrances, either. The field was wide open at that time. So I should like to think that Her Majesty's Government will pay every bit as much attention to trying to help local industry, which is faced with foreign competition in the same way as it is in Great Britain, and will try to maintain jobs as well as to create new ones.
The local enterprise development unit, of which the noble Duke was a very able and very effective director, I may say, for five years, has done an excellent job, as he has said, But I should still like to see Her Majesty's Government and the Department of Commerce doing more for
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the small industrialist. The reason I mention this is that I have in mind two of my constituents who are brothers. They are called Doherty, and they have a small textile production unit in Kirkcubbin, County Down, near where I live. Because they have no other premises they have to work from a corrugated iron, ex-Gospel hall, and they are ashamed to bring there the buyers of their products, such as buyers from Marks and Spencer or Primark, because they feel the whole place looks so "grotty".
Furthermore, they are faced with the dilemma of whether to accept new orders, with the risk of not being able to deliver on time, or whether to turn away work, which obviously they do not want to do. This is in an area where there has been a great demand for job opportunities. These brothers are providing job opportunities on a small scale-25 to 30 jobs but if they had a proper site and premises, not only would they be able to provide more jobs but they would make a very much better impression on the clients with whom they deal. This is the sort of place upon which I think any money spent would be very cost-effective, because these people are already in production; and, in many ways, there is more to be said for helping them than for building an Advance factory which is perhaps going to lie vacant for two or three years.
Self-help was the name of the game in the 19th century. I would stress to your Lordships that we are still not without self-help. As the noble Viscount, Lord Brookeborough, said, we are not all spongers, we are not all beggars. I was honoured and privileged to have the pleasure of opening the Lecale Training Workshops in Downpatrick, County Down, a few weeks ago. This is sponsored by the department and we are grateful for it: but the initiative came from local people, predominantly trade unionists, led by Mr. Malachi Curran. They have a local board or committee which runs the unit. They provide jobs for eight members of staff and they can accommodate 30 young unemployed school-leavers and train them for jobs. Although it was only officially opened a few weeks ago, it had been running and gradually building up for some time. It is most gratifying to sec that a very high proportion of those who received training in that workshop have now secured permanent employment.

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This is because the management and the management committee of the workshop is able to keep closely in touch with local employers and to identify their needs so that they can train young people in joinery, mechanics, laundry work, needlework, office management and so on—all the things that the local employers may require. This is a shining example of what can be done with a bit of initiative and imagination.
I mention the trade unionists as having been prominent in taking that initiative, and I would say in passing that whereas in this country, I am sorry to say, it is mostly had news that is heard from Northern Ireland, I can say without hesitation that the Northern Ireland trade unionists are a most public-spirited breed of persons, as exemplified by the noble Lord, Lord Blease, who is the best trade union leader we have ever had. It gives me greater pleasure than anything else to see that he is now able to serve Northern Ireland from the Front Bench in this House.
My Lords, having referred to two encouraging matters, there is one less favourable thing I should say before I sit down. I have never earned for myself a reputation for saying things that I estimate are going to be popular, and what I am going to say now is not going to be popular and may cause offence among the public. That is, that honest employers and honest employees are getting a raw deal at the moment in Northern Ireland. I am a modest employer myself but, I hope, an honest one. I have a payroll of about 30. I am glad to say that my labour turnover is extremely small. But in the last six or eight months I have had occasion to advertise to fill three vacancies. In a Province with unprecedentedly high unemployment, it was astonishing how poor was the response to those advertisements. Those who did respond asked, "How much money do I get in my hands on a Friday?" They were told that the gross wage was, say, £90 a week. They asked, "How much will I get in my hands?" We said that that depended on their tax liability and they replied, "If that is the case, we are not interested".
The worst instance of this sort of thing is with those who draw unemployment benefit but yet get paid in cash for doing
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casual labour. But the more normal thing is that they would accept the basic agricultural wage (which, I think, is £48 a week or something like it) and let that go down in the books but they would want to get the balance paid in cash.
This makes it very difficult for the honest employer who keeps books, has them audited and conceals nothing from the Inspector of Taxes. It makes it very difficult for him to recruit labour. Worse still, my honest employees resent this deeply because they are paying their full tax liability; they know that these practices take place and they feel, with justification, that they are subsidising those who are not paying their full tax liability. I drew this to the attention of the honourable Member in another place who is responsible for these affairs and I think he took the message on board; but I felt that I should mention it in this House today, knowing, that it is not going to win me any votes at all if ever I happen to stand for election again.
7.24 p.m.
Lord HYLTON: My Lords, an acute observer of modern industrial society has written about "apoplexy at the centre and the anaemia at the periphery". This kind of thing very much affects Northern Ireland, situated as it is, on the very outside rim of Europe. Northern Ireland shares with some of the remoter regions of Great Britain geographic problems which are inescapable. When one turns to the economic situation, it suffers also from the hangover and consequences, of very great prosperity in the 19th century particularly, in shipbuilding and textiles, as has already been said. If that were not bad enough, the very successful post-war textile industry is now in serious trouble with a worldwide surplus of man-made fibres, the consequences of the energy crisis and very stiff competition from various fibres produced in the Third World.
The noble Lord, Lord Blease, and I have recently entertained a group of community workers and councillors from Belfast, nearly all either working in, or with considerable experience of, the inner city. They spent a week in London looking at London's problem. It came as a surprise to them that Belfast shares with London and other English cities many inner-city problems. These are, of

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course, made worse by violence and by intimidation; but they probably would have happened anyway.
May I move rapidly on to housing. It is notorious that the Northern Irish housing situation is probably the worst in the whole of Northern Europe. I was grateful to my noble friend Lord Elton for his prompt reply to my Written Question about housing action areas in Northern Ireland. It is good to know that so far 19 have been declared. Nevertheless, the actual progress in improving houses is not quite so encouraging. I understand that 238 houses have been improved in these areas, another 209 are in the pipeline, while only 314 improvement and intermediate grants have been approved for owner-occupiers. I hope very much that this rate of progress will be greatly speeded up. I know that, so far as concerns housing associations, there were at the start very great difficulties regarding valuation of properties to be acquired; but I think that these have now been largely overcome. It is encouraging that housing associations seem to be accelerating in the action areas.
My noble friend the Duke of Abercorn spoke about the Local Enterprise Development Unit, of which he has great experience. I should like to support and welcome everything that he said about that body. I, myself, was its guest for a day or so in September and was left in admiration at some of the very successful small businesses which it has helped to launch and develop. It is a shining example of self-help—and self-help in the private sector has a great importance; even though I accept so much of what the noble Lord, Lord Underhill, was saying about the public sector.
While in this economic area, I should like to go on to mention a body in the Republic of Ireland which, I believe, is very much worthy of our attention and that is the one called Co-operation North. It was founded at the beginning of this year. It is non-political and nonsectarian. Its purpose is to increase trade and commerce between the North and the South, to improve social and cultural links, and to create greater knowledge and mutual understanding between all parts of the Irish Island. Perhaps I could give one or two practical examples of the work on which it has been engaged. It has pub-
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lished a North/South trade directory. It is promoting a more balanced flow of tourism as between the North and the South. It has sponsored joint trade stands—for instance, in September at the major trade exhibition in Hamburg, Germany, where nine firms took part from the South and eight from the North. Co-operation North is at the moment undertaking a study of North/South co-operation in conjunction with the British/Irish Association. The results of this study will I understand be published within the next six months. I hope that the Government will examine those results with the very greatest care.
I think that energy questions are likely to feature quite large in this report and the noble Lord, Lord Underhill, examined them in some depth. May I say how much I agree with what he was saying. I should like to add two further points: I believe that what is needed when it comes to natural gas is an adequate supply for the whole of Ireland, regardless of North and South. This is particularly necessary and urgent at a time when wellhead gas is being flared off, burnt, wasted, at the oil fields in the North Sea.
A friend of mine in Belfast gave me this rather all-embracing definition of politics. He said:
"Politics includes everything that requires organisation of people and things on a scale larger than that of the extended family".
I suggest that the economic and social problems we are discussing tonight will only find their solution in the context of politics, and the politics that I should like to see coming to the front now are the politics of forgiveness. This may be a slightly obscure phrase, and perhaps I could give it a little more clarity by quoting from a prayer that was found on a scrap of paper left beside the body of a dead child in Ravensbruck concentration camp during the Second World War. It went something as follows:
"Oh Lord, remember not only the men and women of good will; but also those of ill will. But do not remember all the suffering they have inflicted on us; remember the fruits we have bought, thanks to this suffering—our comradeship, our loyalty, our humility, our courage, our generosity, the greatness of heart that has grown out of this; and when they come to judgment let all the fruits which we have borne be their forgiveness".
Our Prime Minister, Mrs. Thatcher, when entering office, moving into Downing

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Street, quoted some remarks attributed to St. Francis. I should like to mention one phrase from that:
"It is in forgiving that we are pardoned".
There is, I suggest, so very much that needs to be forgiven both in Ireland and in England. England has to forgive, for instance, Casement, the Easter Rising and the many brutal murders of our statesmen and soldiers. Ireland, on the other hand, needs to forgive the plantations and evictions, Cromwell and William III and the long period of the penal laws. The Orange tradition needs to forgive Catholic attitudes to such matters as divorce, abortion, birth control, mixed marriages and civil liberties. The Green tradition needs to forgive years and years of discrimination and derision. It needs to forgive injustice and institutional violence. All of us, whether we are English or Irish, and whatever our political stance may be, need to forgive those very many wounds that have been suffered, wounds both ancient and modern. That, I suggest, is the kind of spirit which must underlie the politics required to put right these very great economic and social problems.
7.35 p.m.
Lord VAIZEY: My Lords, I should like to join with other noble Lords in thanking the noble Lord, Lord Underhill, for initiating this important debate. He spoke with real understanding, and we know of his long concern and work in Northern Ireland. We are very grateful to him for it. I am chairman of the British/Irish Association, to which my noble friend has just referred. We exist to promote friendship between the peoples of England, Scotland and Wales on the one hand and the people of Northern and Southern Ireland on the other. In this connection, we have had a great many meetings over many years and initiated important studies on the economic and social developments of Northern Ireland and we work together with Co-operation North, to which my noble friend also referred. Furthermore, and perhaps less respectably—wearing my academic hat—I have been an external examiner for many years in Irish universities. I must have examined more theses on Irish economic and social questions than any other person still extant. Perhaps that gives one the background to some of the questions which have been raised tonight.
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I want to make a couple of simple points. It is astonishing (is it not?) how amazingly well our compatriots in Northern Ireland have maintained their ordinary daily lives throughout this disgusting and degraded campaign of terror. Despite everything, most people still go to work, most children still go to school, students take their examinations—as I know—elderly people go to their pubs and their clubs, and surely there can be no greater tribute to the spirit of man than the way in which the people of Northern Ireland have carried on living. Most humbly and respectfully, I take off my hat to them.
This very strength of social life is the best hope that we have that the violence will not be victorious. In the long run, and it may be a very long run, the power of ordinary people to insist that they will live their ordinary lives as they wish to lead them, and not according to the high-flown theories of the terrorists, is very great. If only the British people insist on holding on in Northern Ireland, then the ordinary people of Northern Ireland will be successful, and the United Kingdom will remain united, which is what practically everybody wants to happen, even if they are "nationalists" in theory.
Having said that, my Lords, I want to turn at once to the immediate subject of the debate, the problems of the economy and of society in Northern Ireland. The position is in some respects, as has been said throughout the debate, very grave. The noble Lord, Lord Underhill, referred to the unemployment figures: Over 20 per cent. in Cookstown and certain other parts of the Province, and over 10 per cent. throughout the Province. These figures are a scandal. But if we leave unemployment on one side for the moment—and in what I hope will be a short speech I want to return to it at the end of my remarks—I want to concentrate on some other aspects of the social and economic questions there.
We have to be careful not to talk down Northern Ireland, not to present the position as though the problems are so great that nobody in their right mind will ever go and live and work there. I read the other day that the housing conditions in West Belfast were "the worst in Europe", and I think that my noble friend Lord Hylton rather emphasi-

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sed this in part of his speech. Are they really worse than Naples? Are they really worse than the bidonvilles in Lisbon? I am not at all sure that these sorts of exaggeration are not part of the myths of English history.
A century ago every single Royal Commission on housing said that the slums of Dublin, of Belfast and of Glasgow were all called "the worst in Europe". Of course, there were no comparative studies whatsoever to back up this hyperbole. I do not think conditions in the Province require this exaggeration. In parts they are indeed bad, very bad; and all that it is necessary to say without exaggeration is that they are not good enough, judged by the standards of the rest of the United Kingdom, and that they should be improved. I think that is the key point we should make.
Furthermore, many of these standards in the social services in Northern Ireland are in fact uniform throughout the United Kingdom. This is a point which is often forgotten in senatorial elections in New York and other parts of the Western world. Since the war, expenditure per head on social security in Northern Ireland has been identical to that of the rest of the Kingdom, for the simple reason that the social security system is nationwide. Expenditure per head on health, to which the noble Lord, Lord Smith, referred so movingly, and on education is higher in Northern Ireland than in the rest of Britain.
Lord BLEASE: My Lords, can the noble Lord indicate how long those figures have been higher? At what stage did they become higher?
Lord VAIZEY: My Lords, if the noble Lord will do me the favour of referring to a book I wrote some years ago called The Costs of Education, he will see that this position has been maintained fairly consistently since the late 1940s, as a result of a variety of complex questions: that is something I shall be coming back to in a moment.
It is also true that, bad though the conditions of housing may be, the subsidies on housing are actually higher in Northern Ireland in some respects than in the rest of the country. These points should be made and they should be made
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known, because it is popularly supposed that Northern Ireland is the part of the country that gets the least public expenditure. Personally I do not believe that is true, and the reason it is not true is that the poorer an area is in the United Kingdom, generally speaking, the higher the level of public subsidy it receives. If we add to the higher level of social services—the higher expenditure per head—the higher public subsidies which exist for job maintenance, I think we reach a conclusion which is worth dwelling on. Northern Ireland is to a great degree one of the most socialised societies in the world. The noble Lord, Lord Underhill, made this very fair point, and I think we should dwell on it. A higher proportion of its national income depends upon the State than anywhere else that I know of in Western Europe.
At this stage I would tend to wonder whether we may not be asking the wrong questions. I respectfully ask this of the noble Lord, Lord Underhill, and also of my noble friend Lord Brookeborough. Should we not be a bit cautious about believing that requests for further public expenditure in Northern Ireland, continually increasing public expenditure, will actually yield very much in terms of solving the problems which we all wish to see solved? A good deal is already being spent in the North and yet the problems remain. I would doubt whether substantial public expenditure would solve many more problems. Of course, it is true that the Republic of Ireland gets £3 a head per week from the Common Market while the Northern Irish are paying 10s. a week each for the privilege of belonging to the Common Market. Just stopping that would, I assume, make a pretty big difference to Northern Ireland. After all, if we stopped paying Brussels the thousands of millions a year we are paying now we could put up child benefit allowance throughout the Kingdom by £2 a week, which seems to be a not inconsiderable contribution to alleviating many of these social problems. However, that is a side issue.
In my view, the problem now in Northern Ireland is not really in the field of public expenditure. It is not a question of increasing public expenditure but of the difficulty of stimulating private expenditure in the economy. I would venture to suggest that it is there ultimately that the

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problem of unemployment must be solved. I strongly support the noble Duke, the Duke of Abercorn, in his plea for further studies on this matter.
In recent years the Republic has been relatively successful in generating economic growth, largely by stimulating the private sector. It really has had an astonishingly successful story in the last few years. I have no time tonight in this short debate to develop this theme, but I really do think it is the central question to which we should direct our thinking over the next few years.
Northern Ireland has until quite recently, as the noble Lord, Lord Dunleath, said, been by far the most successful part of the island of Ireland and it has often been the one of the most successful parts of the United Kingdom as a whole, largely through the activities of private business people. If that atmosphere could be regenerated, as it has been in the South, I would have thought that in a very few years we should see a radical solution to this general problem of unemployment, which lies at the basis of everything that has been said in the debate.
7.45 p.m.
Lord BLEASE: My Lords, I should wish to join in thanking my noble friend Lord Underhill for initiating this important debate. From a Northern Ireland viewpoint, I should also like to compliment him on the objective and constructive way in which he dealt with the issues. As he indicated in his opening remarks, the noble Lord is no stranger to Northern Ireland. I have been pleased to be associated with him for over 25 years in dealing with Northern Ireland affairs on industrial and political matters. I know especially of his strong commitment and concern to improve the wellbeing, the social development and the job prospects of our young people. He rightly drew attention to the unhealthy situation which only at our peril can be dismissed as a situation of such a peculiar and local nature, not relevant to the rest of the body politic. Some people would try to put it in that category.
The problems, difficulties and issues of Northern Ireland are far-reaching. They cannot be contained within the Province and treated mainly as security matters. However much some would wish to sweep
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the problems of Northern Ireland under the carpet, to use the vernacular, they remain with us and have to be dealt with by appropriate social, political and economic action.
The noble Lord, Lord Hampton, indicated that it was necessary to maintain hope and I should like to say that when this debate was known throughout Northern Ireland, it raised a certain interest, and interest generated the hope that at least someone and some persons in Westminster were beginning to look at some of the economic problems. I think that is a very important part of the attitude to adopt in both Houses here.
From this side of the House, I warmly welcome the interest and thoughtful concern expressed by all the speakers who have taken part in this debate. I would not want to single out any one because all of them have contributed very valuably to aspects of the problems we are confronted with. The noble Lord, Lord Dunleath, mentioned something about his notes. I think someone has been looking over them because all the noble Lords seem to have gleaned matters from my notes.
I should particularly like to mention the speech by the noble Lord, Lord Smith, and I should like wholeheartedly, as I am sure other noble Lords would wish to do, to join in paying tribute to all the staff of the Royal Victoria Hospital. They do tremendous work, and indeed at this time last year I had the experience of having a detached retina and had to spend a few days over Christmas in that particular place. I can speak not only of their skill but of their care and of the anxious way they have to go about their work. I hope, of course, that the Minister will not the matters mentioned by the noble Lord.
Before I attempt briefly to underline matters which may be amenable to some positive form of action and decision, I feel I should try to ensure that my remarks are considered in their proper perspective: from my point of view this is important. The noble Lord, Lord Underhill, said he would confine his remarks to social and economic matters. I, too, shall make every attempt to do that, but I am afraid I cannot speak of social and economic matters without in some way attempting to bring in the whole aspect in which the economic and social decisions are made.

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My first point concerns the talks initiated on 20th November by the Secretary of State for Northern Ireland, the right honourable Humphrey Atkins, about the proposed conference and political initiative. On the day that the Working Paper for a Conference on the future system of Government for Northern Ireland was published, I publicly indicated support for the consultations by stating—and here I quote from the remarks that I made at the time:
"The document is constructive and should be welcomed by all, including the Parliament at Westminster, as a first step in the consultative process. However, I believe that the issues for the future peace and prosperity of the Northern Ireland people are far too important to be left to politicians alone to decide. All persons of goodwill, and interested in promoting a brighter and more hopeful future, especially for our children, should seek to use their influence to bring about successful and effective political structures of government for the Province.
"It is vital that the proposed consultations should be earnestly and sincerely tackled, particularly by elected representatives, so that the Northern Ireland people may be enabled to work together for their own general well-being, and to afford us a position that could allow us to regain respect in the world at large. I support the efforts to secure a transfer of responsibility and of powers which will best serve the interests of the Northern Ireland people".
That was my view on 22nd November. It is still my position concerning the proposed consultations.
At the same time, I would add that, while the Government and public representatives cannot ignore controversial issues about constitutional matters and the politics of law and order, I believe that we add to the problems by relegating employment and social difficulties to far too low a priority for public comment and attention. Much more should and could be done to promote informed public debate, and to provide positive leadership concerning the need for economic progress and development.
It seems to me that any political proposals for the future of Northern Ireland should not be taken—and indeed, they cannot be taken—as realistic, humane or honest, unless they take into account and pay explicit attention to the position of the Northern Ireland economy and the future economic and social wellbeing of its people. International competition and trading today demonstrates that political idealism about national independence does not necessarily lead to
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economic autonomy. Whatever doubts may exist concerning the definition of the "Irish dimension", I believe that the real heart and soul of the "Irish dimension" transcends political borders and constitutional issues. The genuine "Irish dimension" is concerned with the boundaries to human happiness, the freedom from fear, and the right to life in all its fullness, in terms of civilised living and opportunities for jobs, homes and the general well being of all the Irish people. I am glad to say that there are many in the North and in the South who share in and work according to these principles.
The noble Lord, Lord Hylton, the noble Duke, the Duke of Abercorn, and others have mentioned efforts that are made to promote functional co-operation. Indeed, my noble friend Lord Underhill also dealt with this point. I believe that this is an area which ought to be developed by noble Lords in this House, and by others directly concerned with Northern Ireland affairs. At this stage, it may be too much to ask the Government to take an active interest in the promotion of North-South co-operation. But certainly the Government ought to be aware of the measures that are available through the EEC, and should make sure that those are well-known and promoted through the proper channels in Northern Ireland. In this, I wholeheartedly agree with the noble Duke.
The second point I wish to make is that the history of chronic unemployment in Northern Ireland is a long and sad one. With the possible exception of a few years during the Second World War, chronic unemployment has been with us since the foundations of the State in 1920, during 60 years of successive United Kingdom Governments, together with the Stormont Government and the more recent Administrations in the Province. They have all sought in varying degrees to analyse, to diagnose, to alleviate and to remedy the employment problems and the relevant social deprivation.
When I look at the economic direction taken by successive United Kingdom Governments in the past decade, I often wonder what might have happened to Northern Ireland had there been no political upheaval, for in the past 10 years full employment has been more or less abandoned as a prime target of economic policy. If we in Northern Ireland had

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been subjected to the full impact of that strategy, I have no doubt that unemployment would now be over 30 per cent.—more than twice the present level. Here I am possibly agreeing with some of the analyses made by the noble Lord, Lord Vaizey. Up till now, we have been spared such a doctrinaire approach, because successive Governments, Conservative and Labour, saw a connection between political and economic instability and political and social insecurity.
While no one has ever claimed that political differences could be eradicated by the treatment of economic ills alone, it is a fact that in other more prosperous parts of the Western world, such as the Netherlands, Switzerland and Newfoundland, with pronounced religious and national differences, the communities have not flared up in civil disorder, destruction, terrorism and murder. Their relative prosperity has provided a social unity and a national economic purpose.
Northern Ireland has attracted a growing proportion of public investment during the past 10 years, which has not only protected the Province from massive unemployment but may have done quite a bit to reduce the level of violence. There can be no doubt that Government intervention in the provincial economy can and is preventing the political and social instability from getting worse. I believe it is implicit in this approach to the real and current problems of one region of the United Kingdom, that the philosophy of State intervention and public expenditure has held together the basic fabric of our Northern Ireland communities. The noble Lord, Lord Vaizey, will probably differ from me in his approach to this. As my noble friend Lord Underhill has warned, these may be some of the reasons for a closer study of the Northern Ireland situation by Members of this House and by others who do not wish to see high unemployment and other forms of alienation disturb and disrupt the social fabric of other parts of the United Kingdom.
I hope that the Minister and others may bring some influence to bear on the Select Committee on Unemployment, which has recently been appointed by this House. I hope that the members of that Select Committee will include Northern Ireland in their visits and studies. It has been
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held by many that we in Northern Ireland have had good cause since 1945 to be grateful to successive Governments for pursuing socialist policies in the Province. I have heard this more than once admitted freely by Northern Ireland Unionist politicians, who understand the background in much detail. The causes and the effects of civil unrest must be tackled for their own sake, for there is no denying that suitable remedial measures in the social and environmental fields help to create a more favourable climate not only for public and private developments, but for political initiatives and community reconciliation.
Therefore, while all these problems are now at the door of the present Government waiting for decisions and action, one cannot attempt—nor would I attempt it—to pin blame on this Government for past years of neglect, nor can one take away from the creditable performance of the previous Labour Government in their promotion of policies and in the provision of funds to carry out economic expansion, industrial training schemes, programmes of housing development and environmental amenities and in the provision of greatly needed community and recreational facilities. All these projects continue to play an important part in promoting general well being, in repairing the social fabric, in building community morale and in maintaining the hope that has already been mentioned by the noble Lord, Lord Hylton.
I should be the first to admit that in the early months of a new Government one can hardly expect immediate and dramatic improvements in the economy and in employment. But by the same reckoning one can understand and note the expressions of alarm and despondency when all the signs indicate a serious worsening of the situation. Among other matters, there is rising unemployment, the closure of major works, cuts in public development programmes, rising costs of fuel, clothing, rates, and other matters.
I do not want to undersell Northern Ireland. This is not a trumpet of alarm which has been sounded by me. Many respectable bodies and persons have sounded this note within the last few weeks. The Minister will know about the Northern Ireland Committee of the Irish Congress of Trade Unions' publication of October entitled Jobs: an Action Programme. This has been referred to al-

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ready by my noble friend Lord Underhill. This programme was discussed at a conference of full-time trade union officials in Northern Ireland. Contained in that document are the following remarks:
"At the time of preparing the document a change of attitude in Government thinking on industrial aid has placed an immediate question mark over at least 2,000 jobs in manufacturing industries. By the time of going to print there is considerable evidence to justify our fears, and one need only to mention the recent redundancy in Harland and Wolff and in the man-made fibre industries as a clear-cut illustration of the effects of the wind of change in Government policy".
At the same time, they say that Government departments are assessing the possibility of cuts of the order of 10, 15 or 20 per cent. which could put up to 6,000 jobs at risk in the Civil Service. There are other remarks on how alarmed they are about the situation.
Trade unionists were so concerned about the position that, because of the relationships which exist between the Irish Congress of Trade Unions and the British Trades Union Council, a meeting was arranged on 12th November. The General Council of the TUC visited Northern Ireland to discuss the grave and urgent problems confronting Northern Ireland, and a statement issued after the meeting contained the following statement:
"The General Council representatives paid tribute to the efforts of trade unionists in Northern Ireland to maintain employment and economic development in the face of severe structural and economic disadvantages and of international recession, now being reinforced by the misguided and pernicious economic policies of the British Government".
The TUC representatives noted that employment in Northern Ireland is more heavily reliant upon the public sector than employment in Great Britain, and shared the fear of the Northern Ireland Committee that recently announced reductions in public expenditure, coming on top of cuts already being effected, would lead to a savage increase in the rate of unemployment in Northern Ireland—which is already among the highest in Europe. The outcome could only undermine the efforts of the trade union movement and other people of goodwill to promote peace and reconciliation.
Another body that has gone on record within recent weeks is the Northern Ireland Economic Council, whose chairman is a noted international economist, Sir Charles Carter. I had the good fortune
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to serve for 11 years on the Economic Council, and know that it is a very responsible, able and, indeed, concerned body. Sir Charles Carter ends the report by saying:
"Clearly the next year"—
that is, 1980—
"is going to be more difficult. All the indications are that real incomes will fall and that unemployment will rise, while some sectors like man-made fibres and part of the agricultural industry have entered into an unusually difficult period. Nevertheless, there are some more hopeful signs on the horizon. There is no reason to believe that the present successes in job promotion will not continue, although the recession in economic activity will make inward investment even more difficult to obtain than in recent years. Thus, there are some optimistic features to relieve a generally gloomy short-term economic outlook".
I should like to make some positive contribution to the debate by putting forward proposals for the Government to consider. I should like to refer to the statement of the Secretary of State for Northern Ireland and the Minister of State, Mr. Hugh Rossi, when speaking on the Public Expenditure White Paper for 1980–81, in which they indicated that it will be the Government's aim to ensure that resources made available for public expenditure are used to the best advantage. The Minister continued:
"We are intent on reducing waste and inefficiency so that all our resources can be effectively devoted to tackling the serious social, economic and environmental problems in Northern Ireland".
Mr. Rossi said something of a similar nature. I know that trade unions and employers wholly agree that more effective use should be made of the financial and other resources which are being made available in Northern Ireland. There is no disagreement regarding the use of finance, so far as Northern Ireland employers and trade unions are concerned. One Minister indicated that he is considering future investment and incentives, and in the Investors Chronicle of 5th October he said:
"I am hopeful that we may be able to use Northern Ireland as an experimental area for different social incentives and do not rule out the possibility that, if the Treasury is able and willing, we might try some form of taxation concession as an experiment".
I should like to ask the Minister whether any progress has been made regarding the experiment. If I may turn to the report of the Northern Ireland Economic Council,

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they say that data and statistics are an important aspect of trying to get decisions right in the employment field.
The report draws attention to figures relating to the gross domestic product in Northern Ireland. While discussing the relevant data, the report says on page 4:
"We should like to take this opportunity of commenting on the data and nature of the available national income and expenditure statistics for Northern Ireland. The more recent data of GDP is for the sector relating to 1973, while statistics for GDP by factor income and for personal incomes are only available on a provisional basis for 1976. Such information is fundamental to a clear understanding of the overall development of the regional economy, and we hope the Government will give priority to providing more up-to-date statistics in this area".
Without entering into a discussion on that, I should like the Minister to take it on board and say whether something can he done about it. It has been known in the Province for some time that the need for relevant statistical data is a very important factor in economic planning and decision making.
Turning to the unemployment statistics, page 7 of the report deals with the lack of proper employment information. Because of time, I shall cut short my remarks and say that although there has been a substantial improvement in official manpower statistics in recent years we urge the Department to continue its efforts to improve the accuracy of employment statistics. So even in the case of data relating to employment we are dealing with it in a very vague and indeterminate way.
I see that 23 minutes have gone by, so I shall be as brief as I can. I have almost a mandate in respect of this particular aspect of Northern Ireland affairs, so I hope that the noble Lord will bear with me—as other noble Lords should also do.
Lord ELTON: My Lords, I have no objection to the noble Lord continuing, but this is a short debate and its time is limited. I shall be unable to reply to a great many of the points which the noble Lord has raised, because that would put me beyond the time that I am allowed to speak. As other noble Lords have restricted themselves, I hope that he will understand my feelings on this.
Lord BLEASE: My Lords, according to my calculations we still have about half
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an hour and five minutes. The Government have initiated and pursued very pronounced fiscal and monetary economic policies. Surely the policies were decided only after full investigation and research and calculation of results in both the short term and the long term. Can the Minister indicate what is likely to be the unemployment figures for Northern Ireland in July 1980 and henceforth? Can he deny the figures which have already been produced by Professor Gibson, speaking at a conference on 6th December, when he said that unemployment in the United Kingdom would be 1.3 million in 1980, 1·5 million in 1981 and 1–7 million in 1982? In relation to Ireland he said that there was a direct correlation and unfortunately unemployment should remain around 60,000 to 65,000 in 1980, be at perhaps 70,000 in 1981 and close to 85,000 in 1982.
I do not (to repeat myself) want to undersell Northern Ireland. All I will say is that other persons are drawing attention to these problems and I should like the Minister and the Government to indicate their concern and either to refute this or to say what action has been taken to counter it. Energy has already been dealt with.
I should like to say again in connection with waste and efficiency that in Great Britain there is a scheme promoted by industry, local authorities and some Government agencies to have reclamation schemes for waste materials brought under some sort of control. These schemes are particularly successful with the recycling of glass, with paper, with textile and metal waste products. The Glass Manufacturing Federation has produced some very useful explanatory leaflets about the bottle bank glass recycling scheme which I understand saves 4 million gallons of oil annually in Great Britain. Apart from the direct benefits which should accrue to the Province from such a scheme, I believe that a programme of this kind should have a general psychological effect and make the community aware of the benefits of saving waste materials.
Lord ELTON: My Lords, on a point of order, if the noble Lord will give way. The noble Lord has spoken for 27 minutes; there are 26 minutes left before the end of the debate. The House expects that I shall reply to as many as possible of

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the noble Lords who have restricted themselves to 10 minutes. I think that, now that he has had the longest innings of anybody, the noble Lord must be very nearly content.
Lord BLEASE: My Lords, I will just finish with two matters. First, a plea for the Linen Hall Library, which this morning I indicated to the Minister through his private secretary that I would raise, together with a number of other matters.
The final point I should like to make is a vital one so far as Northern Ireland is concerned. It concerns industrial relations. Because of the background of industrial relations in Northern Ireland, may I ask the Minister to draw to the attention of the Secretary of State that those responsible for industrial relations in Northern Ireland—that is the Government, employers, trade unions and the Labour Relations agency—shall be given every encouragement to work out solutions suitable to the needs of Northern Ireland? As there is no devolved Government machinery by which these matters can be discussed, steps should be taken to bring the main parties together at an early date to see how far consensus can be reached between the parties. The necessary resources should be available to ensure that the harmful economic effects of avoidable industrial unrest shall be reduced to a minimum.
My Lords, I apologise for speaking for some time. I think your Lordships will understand that Northern Ireland has been going through very sad experiences both in employment and in other matters, and finally I should like to pay tribute to all those workers—which includes managers—who have helped considerably to maintain the Province by production and other methods.
8.15 p.m.
Lord ELTON: My Lords, I hope I did not show undue haste to hear the end of the excellent and very important contribution to this debate made by the noble Lord, Lord Blease. I am sure that noble Lords will wish to join me in thanking the noble Lord, Lord Underhill, for tabling this Motion which has led to such a fascinating debate. He claimed not to be an expert but subsequently he proved
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himself to be so. We have covered many of the topics which might be discussed in the debate on the draft Appropriation Order and I intend to follow the pattern of the noble Lord, so far as the clock allows, in order to take the next debate rather more swiftly.
The seriousness of the United Kingdom's economic situation does not need underlining. Northern Ireland has to contribute to the measures needed to revive the economy because the benefits of success will accrue to the Province as well as to Great Britain. If the economy overall is stagnant it is difficult, if not impossible, to have an effective regional policy. A better climate for investment means more industrial expansion and higher employment and a more prosperous economy can, of course, support more expenditure on services such as health, housing and education. In these circumstances it must be a prime concern for all in Government to see that we get the best possible value for every pound we spend. The noble Lord who has just sat down made that one of his themes, and I welcome it. This means establishing our order of priorities with the utmost care and keeping a close eye not merely on the amount of public expenditure but on its effectiveness.
The noble Lord, Lord Underhill, led very rightly on unemployment and indeed other noble Lords have quite rightly and predictably made this their main subject. The Government are very much aware of high unemployment. What is more we are aware of pockets of unemployment higher even than any which have been quoted this evening. Noble Lords will understand that the whole of the Government's economic and industrial policy is directed at this very problem throughout the United Kingdom, and, since it is more acute in the Province, that is where the chief effort is directed.
My noble friend Lord Hylton referred to the difficulties of the young unemployed. As the Minister responsible for education and youth, I am particularly aware of the fact that the young unemployed are under a different threat to those in the rest of the United Kingdom; that is the threat of recruitment into an organisation which alone in some areas can offer them any status, any employment or any monetary reward. That is a terrible situation and I welcome every effort to cure it, including

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such imaginative programmes as were brought in by the Government of our predecessors—the Youthways Scheme for turning people who were thought to be unemployable actually into desirable employees, and they do it with great success.
On the matter of assistance to industry we are making efforts to provide financial assistance to local industry. The package currently on offer in Northern Ireland is highly attractive and carefully designed to lead to the creation of as many new jobs as possible. We have had a number of successes in attracting new companies to Northern Ireland. To quote only quite recent examples, American Monitor International Limited invested with 250 jobs and the National Supply Company (United Kingdom) with 150 jobs. Two local companies have also demonstrated their confidence in the future of the Province by expanding their plant. The Burlington (Savile Row) Shirts Limited—noble Lords may in fact be clothed in their products at this moment—and the Cooneen Knitwear Company Limited—and I might be able to say the same about that—have both announced 200 extra jobs. Ministers, by official and unofficial tours in the United States, are also assisting in promoting inward investments.
In our election manifesto we recognised that Northern Ireland's industry would continue to require Government support. This commitment was ratified in July when, following the Statement that the geographical extent of the assisted areas and levels of assistance available in Great Britain were being reduced, my right honourable friend the Secretary of State for Northern Ireland announced that he had no plans to change either the level or the form of industrial assistance available in Northern Ireland. In other words, my Lords, that is a ratification of our belief that this is an area of the greatest importance.
Financial assistance to industry forms a major part of public expenditure in Northern Ireland and its successful application is vital to the uphill struggle for reducing unemployment. We are, therefore, anxious to ensure that the industrial incentives are cost-effective and competitive with those being offered elsewhere. Nevertheless, we are not complacent about our performance in this sphere and have
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therefore initiated reviews of both the industrial development incentives and the institutional framework within which they are administered. These reviews will provide a sound basis for decisions about the future handling of industrial development in a cost-effective way, and they include an inquiry into the proper deployment of taxation to encourage industrial development and exports.
All the political parties in the Province have declared their commitment to the success of the local economy. Few things could do nearly as much to improve the prospects for the economy and boost the confidence of investers both outside and inside Northern Ireland as agreement by the parties on how Northern Ireland is to be governed for the future. Local political leaders, working through local institutions, would have the opportunity to mobilise the ambitions and energies of the whole community in the vigorous development of the economy. These would be only a part, but an important part, of the benefits that will be gained by the people of Northern Ireland if and when they can bring themselves to agree a form of self-government.
It would be foolish to expect miracles. Not all the factors for success would be within Northern Ireland's control. Progress would depend not only on local enterprise and performance but also on the state of the United Kingdom and wider world economy. Northern Ireland's ability to determine its aims and priorities and to help itself would however be significantly enhanced. I only hope that the ordinary people of Northern Ireland will exert the extraordinary talent they have, to which my noble friend Lord Vaizey referred, of living normal lives in abnormal circumstances. I hope that their increasingly anxious and impatient voices will reach the ears of those who stand to represent them and compel them to recognise their real desire to establish an agreed devolved constitution in the Province. Within such an agreed framework, his very proper concern to accelerate private rather than public investment could do a great deal to cure the economic ills that so severely accentuate the political problems of the Province.
The noble Lord, Lord Blease, spoke very helpfully on this matter and gave his perceptive and continued support

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to the White Paper initiative. He suggested there should be wider discussion of these and other matters in the Province, and indicated the feeling of a vacuum of leadership. We are in a vicious circle, because there is no point in going into local politics if local politicians have no power and authority, but if local polititians have no power and authority, then they do not produce leaders, and that is why it is so difficult now, I believe, to get the community moving towards the settlement which the community in fact wants. I do not underestimate, and I have already said that I recognise the excellence of, some of the schemes promoted by the predecessor of the noble Lord, Lord Blease.
The noble Lord, Lord Underhill, referred to the gas industry. I can tell your Lordships this. The Government are aware of the dangers of being dependent on only one source of energy. There is no indigenous energy worth financing in the Province. The study for the proposal of a natural gas pipeline led us to conclude that the level of subsidy required to introduce natural gas could not be justified either in terms of the number of consumers who would benefit or the price at which the gas could be sold. In the light of this decision, a policy of continuing to subsidise existing undertakings which presently incur heavy losses could not be sustained. The various undertakings are now in consultation with the Department of Commerce formulating proposals for their own futures. It may be to this that the noble Lord referred rather dramatically as imminent collapse.
In considering assistance towards an orderly rundown of those undertakings which decide to close, the Government will take account of the interests of consumers who will require to convert or replace their appliances, and of the employees who will be affected. The cost of gas and domestic electricity in the Province is higher than on the mainland. The Government are aware of the importance of ensuring that the situation does not result in undue hardship for domestic consumers or for industry. The movement of energy prices will be monitored to see whether changes in the gap between those in Great Britain and Northern Ireland call for further action.
In the medium to long term, Northern Ireland's access to adequate and reliable
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supplies of electricity will depend on achieving a significant diversification away from the present excessive dependence on oil as an energy source. The Northern Ireland Electricity Service is therefore urgently preparing a report on the costs and benefits of converting the second phase of Kilroot to coal firing. The Service's preliminary findings are currently being finalised. Interconnection with Scotland on the electricity grid is another option and study on this is pressing ahead. The NIES is currently evaluating the technical data on the seabed conditions along the proposed or possible route of the inter-connector. An urgent review of the means of restoring effective inter-connection with the Republic is also under way. So this area is not neglected.
On housing, I think it was the noble Lord, Lord Underhill, who raised the point that he was worried about the state of and the lack of size of the existing stock. This year, expenditure will be almost £50 million on this head. In 1980–81 expenditure is expected to be between £55 million and £60 million. It is, however, important to increase the effort to upgrade the existing housing stock, particularly in inner Belfast, and generally in the maintenance of public sector housing. In 1980–81 the Housing Executive is planning to spend around £70 million, as against £50 million this year. So that is a considerable increase, and the first time, I believe, that maintenance has exceeded building of new stock in provision. In additon, the Government are anxious to see that the private housing sector increases its contribution.
I should like to refer to the moving speech by the noble Lord, Lord Hampton, who put a brief visit to very good purpose and followed it up with some very apposite reading, if I might say so. He asked one specific question about the 1978 Education Act. There is one example of a school which is seeking to become an integrated school under the Act. In the initial stages various flaws in the drafting of the Act have made this a slower process than anybody hoped. But the noble Lord can retain an interest and if he likes to get in touch with me I will keep him in touch with it. He also asked about the teaching of history, knowing, no doubt, that I am an historian. I shall not be drawn at length, but I draw his attention to a history competition being promoted by the

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Church's Central Council for Community Welfare; following its inauguration last year as a pilot project in the Western Board, it is now being promoted thoughout Northern Ireland by the Belfast Telegraph. It is receiving financial support from my department. It is open to young people in schools, colleges and youth groups, who may choose to work jointly. The general aim is to remove mythology from Irish history. This year's theme is settlements in Ireland.
My noble friend Lord Brookeborough produced an interesting proposal on the internal repair of houses which I shall pass on to my friend who has responsibility in these matters. On the question of the payment of rents particularly in arrears or out of supplementary benefits, I would say that some of what he wants is already to hand, because at present there are approximately 50,000 tenants of the Northern Ireland Housing Executive receiving supplementary benefit. In some 3,100 cases the rent is being paid directly to the NIHE, either by the Commission, in 400 cases, or under the benefit allocation arrangement, 2,700 cases. There has been criticism of the Supplementary Benefits Commission's refusal to pay rent direct in all cases where the claimant is a tenant of the NIHE. At present the power to pay rent direct is used only in cases where a claimant is persistently defaulting because of an inability to budget properly—for example, due to alcoholism or mental instability. However, consultations are currently taking place to see whether further improvements in these arrangements are possible. So the matter my noble friend raises is in fact in hand.
He then moved to agriculture and advised us to stop the slaughter and provide the fodder. Although I have farmed for many years, I am out of date. Rather than give the noble Lord an answer off the cuff, I shall refer his question to my honourable friend in another place, who will reply to him. He is doubtless aware of the Meat Industry Employment Scheme and, in fact, referred to its expense. The current movement of the relative values of the pounds of the two countries means that this expense is now reducing from the 1978–79 level and the expenditure is expected to be roughly £11.6 million for beef and £4 million for the pig sector in
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the ensuing year. I am going through this matter as fast as I can but some noble Lords will be left out and will receive letters.
The noble Lord, Lord Smith, reminded us of the results of the wicked and horrible deeds that are perpetrated in the streets and indeed the by-ways of the Province. The service of the medical, surgical and nursing staffs of the hospitals is beyond praise. He referred to the soldiers in the corridors. I would remind him that they are not there simply to prevent the—and I must put the word in quotation marks—"rescue" of assassins who have been wounded in an attempt to escape. They are also there to prevent the assassination of people under treatment after a previous attempt. We saw that happen very recently. Those soldiers are necessary and without them the conditions would he worse. He referred to two specific problems, the first of which related to a multistorey car park. I must apologise to the noble Lord for the fact that, although he gave me advance notice of the question, I misunderstood that part of it and I must ask one of my friends in another place to reply to him.
He also referred to the rents charged to the nursing staff. For a variety of reasons, including a freeze on rent increases, rents were last reviewed in 1976 and were then set at 1973 levels. The present increases are aimed at bringing rates up to date by 1st July 1980. But, acknowledging the size of the increase, the department decided that it should be introduced in two stages, the first as soon as practicable and the second from 1st July next year. As in England, the new rents are related to public sector housing rents. This is more favourable to tenants than the previous system where rents were related to the private sector and were determined by the district valuer. However, following the appeal against the new rents by tenants of Broadway and Victoria Towers, to which he referred, the district valuer has recently completed the review of the notional annual value of the flats in these blocks, as requested.
In the majority of cases the revised values reflect a reduction of between 26 per cent. and 36 per cent. compared with the former values. That will result in a corresponding reduction in the rent and rates element of the charge already notified to the tenants. The fixing of the charges, for

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heating, maintenance and other services provided by the Board is rather complex, and the department, in conjunction with the Board, has also been carrying out a review of these charges to ensure that only items properly payable by the tenants have been included. That review should also be completed shortly. I hope that this will help the noble Lord to see that the problem he has raised, which is a real one, is being dealt with.
My noble friend the Duke of Abercorn raised a number of questions on taxation and other matters to which I shall not reply in great detail. On the question of the tax concession on exports, I should point out that officials from interested departments are currently examining the possibility of having some kind of concession on exports. However, any such arrangement must, contrary, I think, to his own supposition, conform with EEC rules on state aids to industry and they must also be consistent with United Kingdom fiscal policy. Because of difficulties in satisfying the EEC rules, the Irish Republic has, I understand, decided to phase out its tax concession on exports and to replace it by a lower rate of profits tax. It may not be as easy as my noble friend thinks.
As regards the European Investment Bank, the Department of Commerce has publicised the facilities available to small firms from the European Investment Bank. Unfortunately the response has been disappointing, as has been noted, but the Department is not aware that any project has been held back due to lack of investment funds in Northern Ireland. If the noble Lord is aware of exceptions I should be glad to hear of them and pass them on.
The noble Lord referred to LEDU and I think that one or two noble Lords pointed out that home grown is best grown. It is also best rooted and least likely to be blown away. I could not agree more with what has been said about LEDU and therefore I could not say less, because time presses. That also was a theme touched upon by the noble Lord, Lord Dunleath. In fact, he then proceeded to illustrate the effects of excessive taxation which leads to dishonesty. This is an hereditary disease, but I believe that it is curable.
The noble Lord, Lord Hylton, referred to Co-operation North, the aims of which
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are admirable. I am sure that my honourable friend will study the report very closely and I shall draw it to his attention. He also quoted a very moving prayer. Although I would endorse what he said, I do so with great embarrassment and humility. Forgiveness is difficult enough to practise, but far more difficult to preach. Who am I—and, with great respect, who is he—to preach forgiveness to people who have had friends mutilated, who have lost their children, whose homes have been blown up, whose places of work have been burnt out and who have had to leave for another country? Who are we who have not suffered these dreadful strokes not of fortune, but of villainy, to preach forgiveness? None the less it must be said.
The noble Lord, Lord Vaizey, then produced some agreeably conservative economic policies. I congratulate him on those. My noble friend does not seem to have considered Northern Ireland's receipts from the European Community. In fact, it was allocated £46.8 million from EEC funds between January and September, and it is likely to receive a net benefit from the Community this year. However, Northern Ireland suffers, like the rest of the United Kingdom, from the fact that our contribution ought to be reduced.
I should now like to leap, regardless, into my peroration over the heads, I fear, of one or two noble Lords who deserve better. I should like to say that the noble Lord, Lord Underhill, in his introduction, referred eloquently to a number of pressing problems which beset the Province. I should, in conclusion, like to place them in their proper context. That context is the economic position of the United Kingdom as a whole, which must itself be seen in the context of a difficult and unforgiving world economic climate. No man is an island and in Ireland, North or South, one has to retool one's quotations: no Ireland is an island either.
When this Government came to power they were to discover vast commitments to spend public money and there was no way in which that money could be obtained without either a crippling increase in taxes or a level of borrowing that would have discredited us in the eyes of the economic world. This was coupled with high unemployment, low productivity, a

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level of investment that did not suggest that it was about to be cured and a chronic condition of inflation. In order to turn round so many unsatisfactory and even dangerous trends, we decided to stop the growth in public expenditure, to reduce the burden of direct taxation and to encourage a climate where both earnings and investment should be worthwhile occupations. That meant a cut in planned, but not immediately in existing expenditure. The Province of Northern Ireland being part of the United Kingdom is subject to all the disabilities of the country as a whole, and as a part of the whole it will also benefit from every improvement we can contrive. In fact, a number of the disabilities are felt in the Province to an exaggerated degree and noble Lords have referred to them. For example, the unemployment rate. The Province, therefore, stands to gain a great deal more job for job and pound for pound than does the rest of the United Kingdom when our present economic policy eventually bears fruit. The medicine we have to take may taste nasty, but it is strong. It will not cure us overnight, but cure us it will!
8.39 p.m.
Lord UNDERHILL: My Lords, I should like to thank all those noble Lords who have taken part in this debate for their helpful and constructive contributions. In view of the time factor, may I briefly say that everything will be on the record and will no doubt be commented upon widely in Northern Ireland. I can only hope—and I am sure that your Lordships will hope—that what has been said here may be of help to the people of Northern Ireland in their determination to get over their problems. With those few words, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

APPROPRIATION (NO. 3) (NORTHERN IRELAND) ORDER 1979
8.40 p.m.
Lord ELTON: My Lords, I beg to move that the Draft Appropriation (No. 3) (Northern Ireland) Order 1979, which was laid before this House on 8th November, be approved. The Draft Order would authorise the issue out of the Northern Ireland Consolidated Fund of additional
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financial requirement of Northern Ireland Departments in the current year. The amount being sought is £33 million and would bring the total Estimates provision to date for 1979–80 to £1,675 million. The first schedule to the draft order lists the services for which the extra provision is required, and further information is contained in the autumn Supplementary Estimates volume which is available in the Library.
The largest amount sought relates to agricultural support, where some £17 million will be used for production, processing and marketing schemes. Of the £14 million required by the Department of Health and Social Services, about £12 million is needed for the higher rates of supplementary benefit and other allowances payable from November 1979. Those two points draw this debate very closely to the one that we have just concluded. I commend the order to the House. My Lords, I beg to move.
Moved, That the draft order laid before the House on 8th November, be approved—(Lord Elton.)
On Question, Motion agreed to.

NORTHERN IRELAND (EMERGENCY PROVISIONS) ACT 1978 (CONTINUANCE) (NO. 2) ORDER 1979
8.42 p.m.
Lord ELTON: My Lords, I beg to move that the draft Northern Ireland (Emergency Provisions) Act 1978 (Continuance) (No. 2) Order 1979, which was laid before this House on 28th November, be approved. As the House well knows, terrorism continues to bedevil Northern Ireland; and that is the reason for proposing once again that the Emergency Provisions Act should continue in force for a further six months. Your Lordships will expect me to give, as is customary, an analysis of the current security situation in Northern Ireland. What I would like to do is to give an analysis which seeks to avoid the two traps of unnecessary pessimism and unqualified Optimism, both based on too narrow an interpretation of a few well-publicised incidents.
Contrary to general impressions, the level of violence in 1979 is not much

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higher than it was for 1978. The pattern of violence, however, has changed and there are certain geographical areas of Northern Ireland—particularly the counties of Armagh and Tyrone—where there has been a marked increase in violence. But taking Northern Ireland a a whole, and taking all the indicators together, 1979 has seen only a slight upturn in violence over 1978. There have, of course, been some terrible incidents in 1979 and these have rightly shocked us all. One hundred and four people have lost their lives so far this year, 56 of them members of the security forces and nine of the Prison Service.
The figures I have quoted show to what an extent the Provisional IRA have concentrated their venom this year upon the security forces, and—more strikingly still—upon the Prison Service. In the Prison Service we have a body of men who are carrying out their onerous task courageously, effectively, and without complaint. The prison governors and their staffs are not members of the security forces; yet they are specifically attacked by the Provisional IRA as if they were. The role of the prison officer is to treat those committed by the courts, whether under sentence or on remand, in accordance with the requirements of prison rules—which broadly speaking are the same in Northern Ireland as in Great Britain. They are not in any way concerned with the circumstances of the offences for which the men and women in their charge were sent to prison. If the Provisional IRA believe that by their attacks on prison officers, they will further their campaign for special concessions for convicted criminals who belong to their organisation, I have to tell them that they are wasting their time. The Government will grant no such concessions. If the Provisional IRA are hoping to break the morale of the Prison Service, I am glad to say that I have not the slightest reason to suppose that they are having any success. I take this opportunity to pay tribute to the courage and devotion to duty which the prison staff have shown.
I am sorry to say that in recent months there has been an increase in what appear to be sectarian killings. There is something peculiarly obnoxious about killing a man because he holds a particular creed or a particular family name—and to some foreigners it must appear that everyone in
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the Province is either called Montague or Capulet. These assassinations can profit no one. They will simply add to the spiral of violence. I have to make it clear that the full weight of the law will be brought to bear on the perpetrators of violence, regardless of their origin or their motive.
It would be foolish to pretend that terrorism does not continue to pose a serious problem, particularly in parts of Belfast and some of the Border areas. Besides the continuing attacks on the security forces and prison officers, the co-ordinated bomb and incendiary attacks on 26th November show that the Provisional IRA does retain the ability to cause disruption and destruction on a significant scale; but I am pleased to say that a significant number of these devices were neutralised by the security forces. I know your Lordships will agree with me on the great debt of gratitude which we and all the people of the United Kingdom owe to the dedicated and immensely brave men and women of the RUC and the Army who, like the prison officers, daily put their lives at risk in the service of their fellow citizens.
Your Lordships will wish to know what the Government themselves are doing in the face of the continuing terrorist threat. We remain fixed in our resolve to eliminate terrorism and to restore normal policing throughout Northern Ireland. The essence of this policy is that the RUC, with the Army in support where necessary, should bring terrorists to justice before the courts. But there are many ways in which the security forces frustrate the evil designs of the terrorist. Since the beginning of July when I last moved the renewal of this Act, 124 firearms and over 20,000 rounds of ammunition have been recovered and 62 explosive devices have been neutralised before they went off. The most effective means of defeating terrorism, taking terrorists out of circulation through the processes of the law, is being pursued with vigour. So far this year 625 persons have been charged with terrorist offences, 44 with murder and 34 with attempted murder, and up to the end of November 805 persons have been convicted of such offences, including 52 of murder and 16 of attempted murder. These are figures which are not sufficiently often seen in the Press.

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The search for effective measures to thwart the terrorist is constantly pursued. For reasons which I know the House will appreciate, I do not intend to detail all of these measures. I should, however, like to mention a number of important developments. First, as the House will know, the target strength of the regular RUC was raised from 6,500 to 7,500. This was at the end of August and by the end of November the strength stood at 6,580 compared with 6,110 at the end of 1978. The widespread support for the RUC is illustrated by the continuing high number of applications to join the Force, since the increase in the target strength was announced. These extremely encouraging recruting trends are matched by many other improvements in the capability of the RUC. The vehicle fleet is being steadily increased; a new and very advanced teleprinter system has been commissioned; a modern command computer system is due to be operational next year and a massive building programme is in hand to provide increased accommodation and facilities for the Force.
The Chief Constable undoubtedly has at his command a thriving and modern police force, well-equipped to fight terrorism but still mindful of its other responsibilities to the community including, for example, its regular community relations work. I take this opportunity of paying tribute to two men who have played a crucial role in maintaining the effectiveness of our security efforts in the Province. Under Sir Kenneth Newman the RUC has steadily grown in strength and ability. The fact that the morale of the Force has also remained high, in spite of the extraordinary demands and stresses imposed upon it by the terrorist campaign, is a measure of his outstanding leadership and of the respect in which he is held by those under his command. In the same way, the cool determined efficiency and professional response of the Army in the aftermath of the tragedy at Warrenpoint in August are equally clear evidence, if that were required, of the impact and firmness which General Creasey has brought to the Army's work in Northern Ireland. I am sure that your Lordships will wish to join with me in expressing our gratititude to both the Chief Constable and the GOC for the unenviable burden
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which they have shouldered with such fortitude during the years of their appointments.
I am sure that the House will have been heartened by the recent major successes of the security forces of the Irish Republic against our acknowledged common enemy, the IRA. These include the large arms find in Dublin Docks, the arms finds in the Border areas and a number of convictions for terrorist offences, including the murder of Lord Mountbatten. These are just illustrative of the fight being waged against terrorism throughout Ireland.
I have instanced some of the ways in which we are maintaining the drive against terrorism. We shall not shrink from any further measures that we may consider necessary to overcome the threat. The keynote to our policy is flexibility: flexibility in the use of manpower, in the disposition of forces, in the choice of operational tools, in the individual response to particular terrorist activities. But there are two things we must not do. We must not take actions which would have, at best, a cosmetic effect; nor must we adopt draconian policies which, dramatic as they may sound, would involve in practice a far less efficient use of security force manpower or would undermine the success we are having in isolating the terrorists from both local and international support.
The shadow of terrorism in Northern Ireland should not be allowed to obscure the very real progress which is being made there in many economic and social fields, nor will the Government be diverted from their determination to find an acceptable means of restoring to the people of Northern Ireland more responsibility for their own affairs, which is a common factor to both debates this evening. In many parts of the Province the spirit of the people and their will to restore their lives to normality, and maintain it in abnormal circumstances, give me much cause for optimism and admiration.
To sustain this optimistic spirit we must ensure that the security forces are given the full support of the law in their hazardous task. That law gives them certain powers which are out of the ordinary, and it is essential that Parliament should consider carefully every six months that it is right

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to extend them. The Commission of which the noble Lord, Lord Plant, is chairman—the Northern Ireland Standing Advisory Commission on Human Rights—has properly made it its business to reinforce that obligation. They have been giving close study to the Emergency Provisions Act and its operation, and they have concluded that the time has come for us to begin to allow some of the stronger provisions of the Act to lapse.
The noble Lord is aware that the Government have not felt able to agree with this view. But the House should be aware that we fully respect it, and will be swift to restore the position when we are convinced that it is safe to do so. For the time being the Government do not consider that it would be right to relinquish the powers which Parliament has made available to deal with those who disregard the law, the value of human life, and all civilised conventions, including Parliamentary democratic government, in pursuing their evil purpose. My Lords, I beg to move.
Moved, That the draft Order laid before the House on 28th November, be approved.—(Lord Elton.)
Lord BLEASE: My Lords, I should like to join the Minister in his tribute to the security forces, and particularly to the staff of the Prison Service who do a worthwhile, honourable and very difficult job. I also recognise that when this order was debated in another House yesterday it had some six hours of discussion spent on it. I note the noble Lord's remarks concerning the Human Rights Commission and Lord Plant's role in that Commission, and I would support the order for approval for a six months' period.
Viscount BROOKEBOROUGH: My Lords, might I ask the noble Lord that the next time this order is debated we should deal with it at an earlier time when certain subjects could be raised? I think that this is the second time that it has been moved at the end of a long day, when people are fed up with listening to the problems of Northern Ireland. I think there is an issue which cannot he let go, and which will take me one minute to mention. I should like to support a statement by the honourable Member for West Belfast, Mr. Fitt, only I would put it in slightly different terms.
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I was amazed that the Secretary of State should say that he was confident that the Irish Government would be as persuant in its security policy as the previous Government. It does not seem to me, when Mr. Haughey's own peers were judging him and saying that there was a flaw in his make-up and that Ireland wanted his leadership as much as a man wanted a hole in his head, that that was exactly the thing to say at this particular moment. But the issue is clear that the Secretary of State, having made this statement, which to me is an amazing statement, must make absolutely clear to the Prime Minister of the Irish Republic that there is no British withdrawal and that Ulster is British. If we do not have that, then the few sectarian murders he has mentioned will become a flood. I support absolutely Mr. Fitt in that tremendous fear. It must be absolute, because we know the present price. It is nothing to do with us who governs the Irish Republic, but we know his history and have seen his own peers judge him. This is something of which we are very conscious.
Lord ELTON: My Lords, I am grateful to the noble Lord, Lord Blease, for his reception of the Motion. I would assure the noble Viscount, Lord Brookeborough, that the House never tires of his voice nor that of Lord Blease under circumstances when the clock permits. I will see that the usual channels will fix up an earlier debate for this subject in the sad event of our debating it yet again in six months' time.
Lord DUNLEATH: My Lords, before the noble Lord sits down, might I ask him if he could tell me whether it is true or untrue to say that if our law was in conformity with the law in the majority of EEC countries—
Lord TREFGARNE: My Lords, I think the noble Lord is out of order. My noble friend had really sat down.
Lord DUNLEATH: I accept that.
On Question, Motion agreed to.

MINERAL EXPLORATION (NORTHERN IRELAND) ORDER 1979
8.55 p.m.
Lord ELTON: My Lords, I beg to move that the Mineral Exploration

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(Northern Ireland) Order 1979, a draft of which was laid before this House on 6th November be approved.
The order before the House makes provision for the payment of grants to persons carrying out mineral exploration activities in Northern Ireland. Northern Ireland does not have an extensive mineral industry and in fact only one mine, for salt—no one raised that in a penal context in the earlier debate—is operating commercially at present. However, we are hopeful that further exploration of the area will in time lead to the identification of commercially viable deposits. Most mineral rights in the Province have been vested since 1969 in the Department of Commerce which in that period has issued 53 prospecting licences. Seven licences covering an area of 725 square miles are currently held by prospecting companies and a further four applications are being considered. This I think attests to the interest being shown in the Province by mining companies. The range of minerals being sought is considerable. Apart from salt, which seems to exist in abundance, the companies are searching mainly for base metals but also for coal, lignite and uranium.
The effect of the order will be to allow the Department of Commerce to pay grants to companies and individuals involved in these activities. This will bring Northern Ireland fully into line with Great Britain as the order will largely reproduce those provisions of the Mineral Exploration and Investment Grants Act 1972 which relate to minerals. The fact that the Act of 1972 did not apply to Northern Ireland did not give rise to concern until March 1977. Prior to that date persons undertaking prospecting operations in Northern Ireland could claim assistance under the Capital Grants Scheme operating in the Province. However, when this scheme was revised to exclude non-manufacturing categories prospecting activities become ineligible for grant. As a result companies operating in Great Britain had an advantage over those carrying out similar functions in Northern Ireland. This order will correct that anomaly.
The order itself is short and contains only three articles. Articles 1 and 2 deal largely with procedural matters and the
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meat of the order is in Article 3. Article 3(1) gives the department general authority to pay grant for mineral prospecting operations. It is intended that the Department of Commerce will draw up detailed provisions at a later date and that the grant scheme will be similar to the one operated under the Great Britain Act of 1972. Article 3(3) fixes the upper limit of grant at 35 per cent. and allows the department to impose conditions on persons receiving grant. The one condition specifically referred to will allow the department to "claw back" grants from operators whose prospecting activities enable them to identify viable ore deposits. This provision is intended however to apply only where profitable extraction results.
Article 3(2) is intended to safeguard environmental interest by requiring that no one can claim grant without first satisfying the Department of Commerce that planning permission has been obtained or is unnecessary. Most prospectors will have to obtain a licence from the department. This is an additional safeguard since the department will normally consult a wide range of interests, including planning authorities and district councils, before granting a licence.
Article 3(4) sets a ceiling on the total amount of grant payable under the order but also makes provision for this to be increased if required.
Lord PEART: Come on!
Lord ELTON: The noble Lord says "Come on!". I have one paragraph to go. It might not be of great interest to the noble Lord, but on the other hand we have the readership to he considered of the people affected by this order. Article 3(5) provides that a report will be made annually as part of a statement already prepared by the department on its mineral development activities. This report will include information such as the number of companies assisted and the amount of grant paid in each year.
Perhaps I should comment on the definition of minerals in Article 2. Only minerals as defined under the Mineral Development Act (Northern Ireland) 1969 for the purposes of prospecting licences, will be eligible. I will not read them out,

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but as in Great Britain natural gas and oil are not included, as these are the subject of separate legislation. My Lords, I beg to move.
Moved, That the draft order laid before the House on 6th November, be approved. —(Lord Elton.)
On Question, Motion agreed to.

BUILDING REGULATIONS (NORTHERN IRELAND) ORDER 1979
9 p.m.
Lord ELTON: My Lords, this order consolidates the Building Regulations (Northern Ireland) Order 1972 and the Building Regulations (Northern Ireland) Order 1978 and related legislation. It does not make any changes of substance in the existing law but brings it together in one order. My Lords, I beg to move.
Moved, That the draft order laid before the House on 13th November, be approved. —(Lord Elton.)
On Question, Motion agreed to.

PERJURY (NORTHERN IRELAND) ORDER 1979
Lord ELTON: My Lords, this order consolidates the Perjury Act (Northern Ireland) 1946 and the enactments amending it. It does not make any changes of substance in the existing law but brings it together in one order. My Lords, I beg to move.
Moved, That the draft order laid before the House on 21st November, be approved. —(Lord Elton.)
On Question, Motion agreed to.

CONTROL OF FOOD PREMISES (NORTHERN IRELAND) ORDER 1979
9.1 p.m.
Lord ELTON: My Lords, this order will strengthen control of hygiene in food premises by bringing legislation in Northern Ireland into line with that in force in the rest of the United Kingdom. It will close a potential loophole in the Food and Drugs (Northern Ireland) Act
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1958. At the moment persons convicted of food hygiene offences may, on the application of a district council, be disqualified by the courts from using premises for the purposes of a food business. A court order can be circumvented and this will prevent it, but unless noble Lords wish to pursue the matter in greater detail, when I shall be happy to answer questions, I simply beg to move.
Moved, That the draft order laid before the House on 22nd November, be approved.—(Lord Elton.)
On Question, Motion agreed to.

HYPNOTISM BILL [H.L.]
9.3 p.m.
Report received.
Schedule—[Amendments to Hypnotism Act 1952]:
Viscount SIMON Viscount SIMON moved the Amendment:
Page 2, line 6, leave out ("living").
The noble Viscount said: My Lords, I shall be brief in view of the important business which is to follow. I raised the point with which the amendment is concerned with the noble Earl, Lord Kinnoull, in Committee and, not unnaturally, because I shot it at him without notice, he did not know the answer. The word in question appears in the new, amended section of the Hypnotism Act 1952, where it says that subject to certain conditions:
"No person shall give an exhibition, demonstration or performance of hypnotism on any living person".
The significance of the word "living" has completely defeated me, because obviously one could not hypnotise a dead person, and I cannot think of any reason for the inclusion of the word except that this is a copying of the words used in the 1952 Act.
As we are amending that Act by this Bill, it seems that a further amendment to leave out that word would be apposite if, as I surmise, it has no significance. However, I understand that the noble Earl has found some significance and will tell the House about it; and if your Lordships then agree that it is sensible to include the word, I shall withdraw the amendment at once.
The Earl of KINNOULL: My Lords, I am sure the House is always grateful to the noble Viscount, Lord Simon, for spotting what may be loose and superfluous phrases in Bills. As he said, he raised this point in Committee and I then promised to investigate this mystery of why it was necessary to emphasise the word "living" in the phrase "living person". As the noble Viscount said, the schedule to the Bill is lifted out of the 1952 Act, but of course one should have been aware that that would not suffice his critical revisionary appetite.
I have taken advice, and the best advice I am given is that if one did not have the word "living" in front of "person", but simply used the word "person" on its own, juridically it could be termed a company. It does not have to be a living person; it could be a company. I do not think even the greatest hypnotist would claim that he could hypnotise a company, even if some chairmen can. I hope the noble Viscount will accept that explanation and withdraw the amendment because I submit that retaining this phrase is necessary, avoids offending the finer feelings of parliamentary draftsmen and adds clarity to a small Bill which has a certain confusion endemically in its subject.
Lord TREFGARNE: My Lords, my noble friend Lord Sandys has lost his voice and it falls to me to express the Government view on this amendment, which is apparently that it does not matter very much whether the word remains in the Bill or is removed. We therefore feel that if the noble Viscount wishes to insist and my noble friend Lord Kinnoull does not object too much, then the amendment could reasonably be made.
Viscount SIMON: For my part, my Lords, I should like to stick to the amendment, if the noble Earl does not object too much; but perhaps he does.
On Question, amendment agreed to.

OVERSEAS STUDENTS: FEES AND FUNDING 1980–81
9.6 p.m.
Lord STEWART of FULHAM Lord STEWART of FULHAM rose to ask Her Majesty's Government whether
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they will give a full account of their plans for fees and funding of all students from overseas, including funds provided to the British Council for that purpose, in the academic year 1980–81. The noble Lord said: My Lords, this Question was based originally on a single sentence in paragraph 33 of the White Paper on Public Expenditure. It reads:
"New overseas students or their sponsors will be expected in future to meet the full cost of their tuition".
However, in that single sentence are wrapped up many implications and consequences, and I must say at once that I am indebted to the noble Baroness, Lady Young, for the help she and her office gave me in providing information about a number of the matters involved.
I recognise that time is moving on and that there is a long list of speakers. I shall therefore endeavour to be as brief as a subject of this importance and complexity allows. I shall seek to set out in general what I think are the main issues involved, and I am sure that many of the noble Lords who are to speak later will be able to enrich that by individual and close knowledge of universities, of students and of the welfare of students and the problems they face.
First, I should say that it seems to me that this proposal concerning the fees of overseas students dwarfs any previous proposal about them that has ever been considered. I notice, though it was before I was a Member of this House, that in July there was a debate here on a proposal for an increase of student fees, but in that debate, to take one example—that of the fees of undergraduate students—what was in issue was an increase of those fees from £770 to £940. Now we are told that if the full fee is to be paid, the figure for the undergraduate student—for postgraduate students it will he a higher figure, and many of those whom we are discussing are postgraduate students—will not be £770 or £940, but will be at a minimum £2,000, £3,000, or £5,000 according to the nature of the course pursued; and those are minimum figures. Whereas in the debate in July the Government claimed to be saving £6 million, I understand that they now expect—though I shall throw some doubt on this later—to make an economy for the public purse of about £90 million.
As I say, this is a proposal that dwarfs all others, and I do not think that we shall need in this debate therefore to look back and consider what was done or said over student fees by one Government or another in the 'sixties or 'seventies. We are now dealing with a quite different order of proposal.
I want first to put this question to the noble Baroness, Lady Young. What do the Government think, or hope, will happen as a result of this measure? Are they working on the assumption, for example, that the students will turn up and pay up in the same numbers as they do at present?—because as a matter of fact it is only on that assumption that the Government would save the £90 million. But I find it difficult to believe that the Government are really expecting that to happen. But let us suppose for a moment that that is what happens—that the number of overseas students attending our universities is the same—and the Government can then say that they have succeeded in shunting £90 million off the shoulders of the British taxpayer on to foreign students, their parents or their Governments.
But even if the numbers remain the same, the students will be different. Fewer of them will come from poorer countries. There is, I believe, already some tendency for this to occur in universities which have experienced earlier rises in fees. That will mean that students from countries desperately in need of knowledge, particularly in certain fields, will be the ones most likely to be deprived by this. Not only will it in future be students from richer rather than poorer countries—even if the numbers keep up, and that is a great if; it will be individually the wealthier, rather than the poorer, students. I believe in some universities there is already some anxiety as to whether they can keep up academic standards when there is created a situation in which the range of students who can even afford to approach the university is limited.
At this point, I would add what might be called a detail, but it is a detail of rather moving importance. Is any special provision to be made for the needs of refugee students?—because they will find the requirement to pay full fees of particular
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difficulty. In a reply on 27th November to a Question for Written Answer the noble Baroness said something about students from countries in the European Community. She said something, but I think she will agree that it was not then precise; the Government had not decided what their position would be. When the Government are looking at that problem, can they also look at the problem of refugee students?
So far as I have spoken on the assumption that the number of overseas students stays up to a figure of between 80,000 and 90,000, which it is at present, and I am asking whether the Government hold that assumption. But I am bound to say that I do not think they do, because they have already expressed some anxiety about student numbers, in particular research students, by putting forward an award scheme for those whom it is hoped will be research students doing work of exceptional value. To begin with, it is to affect 500 such students and possibly build up later to 1,500. To begin with, £1 million, and I presume that it might rise to £2 million or £3 million, if the scheme goes ahead as the Government suggest. I think it fair to say that this proposal has been received by the universities with very moderate enthusiasm. The vice-chancellors said that the scheme was not the best way to attract the most able future research workers to Britain and the secretary-general of the vice-chancellors' committee said that it will do very little to undo the harm caused by the Government's full-cost fees policy. But the fact that the scheme is put forward indicates, I think, that the Government have some anxiety about the number of students, and are making a tiny attempt to relieve their anxieties in that field.
I return now, my Lords, to what I believe to he the much more probable assumption—and, I expect, the assumption the Government are making—that there will be a marked falling off in the number of overseas students. Let us see what the results of that will be—first, on the universities themselves. The Government have told universities that the grant to universities will be reduced by 13 per cent. in view of the fact that they will, one hopes, be getting the fees from overseas students instead. Of course, if that happens, if all the students turn up

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and pay the full fees, the universities might not fare so badly; but it is extremely unlikely that they will. So when we look at this proposal, although in form it appears to be a proposal to shift the cost of students' education from the British taxpayer to the foreign Government, to the foreign parent or to the foreign student, what it is in practice is a way of reducing expenditure on the universities. That is what is really going to happen.
I suppose one can say, "Well, these are hard times, the Government need money, and every institution has to be looked at". But what a curious way the universities are being looked at. I suppose that if one tried, one could make a case for saying that certain economies can be achieved in the universities, but would you really begin by saying that a university's resources are to be cut down to a greater or less amount according to the proportion of foreign students that it now has? Because although, as the vice-chancellors have pointed out, in general it is one-eighth of their income that will be at risk, in some institutions it will be one-third of their income that is at risk. This is going to be an operation completely indiscriminate; and if the number of overseas students goes down, the university lacks its grant and the student fees do not come in, the Government will surely accept that a university cannot he expected to shrink its expenses in proportion to a reduction in the number of its students. There are, of course, overhead expenses and it is this fact that makes a great deal of the calculation about what is saved a rather shadowy and unreal one.
If the result is that you have universities with unused facilities as foreign students cannot come forward to pay the full fees, in some cases they will be facilities provided for courses specifically designed for the needs of overseas students. Courses of that kind are very necessary. Some countries, for example, have a great need to send their people to this country to learn more about the proper conduct of agriculture, and some universities in this country have set to work to meet that need. A possible result of what the Government now propose is that all the preparations made for those courses will be so much waste.
Surely the Government know that if you are talking about economy it is not
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enough to play about with figures of money. You must consider what is happening to resources; and what is most likely to happen here is an actual waste of resources. I wonder whether the Government have considered this aspect of the matter. The cheerful way in which they have talked of £90 million, the cheerful way in which they have talked of cutting the university grant in the expectation that the overseas students' fees will make it up, suggest they have not fully considered what will happen. I think they may take the advice which has been tendered to them in some university quarters that, before bringing this scheme into operation, they should hold a speedy inquiry and find out exactly what will happen in certain universities, because I think that that preliminary work has not been done.
Those are likely to be the results on universities. What about the results of this proposal on the country as a whole? Much has been said—and I notice that much was said in the debate in July—on the value to this country of having a body of overseas students here; and if I run through the points about that briefly, it is not because they are unimportant, but because I think we are all familiar with them. There is the value of the research work done by students; there is the advantage to our balance of payments which comes from expenditure by the students and their relatives visiting here; there is the undoubted advantage of having overseas in the future in important commercial positions people who have close connections with this country. These advantages cannot be precisely quantified; but I do not think that anyone will maintain that they do not exist. The great weight of business opinion, and that of the people who do this kind of business, is that it is a decided advantage to us to have abroad in commercial positions people who have pursued their university studies here. Then there is the political advantage, the desirability of having in the future people in important political and governmental positions in their country who have had their university education here rather than elsewhere.
I would say this. If the Government do not believe that that is important; if the Government do not believe that it is of great advantage to the influence and the prestige of this country to have overseas

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students; if the Government do not believe that, then they are unique among all the developed countries of the world in that disbelief. The Russians have no doubt about it at all and neither have most other countries with highly developed university systems. I say no more about those matters. They have been very much discussed in the past. I accept the difficulty of quantifying. But I say that here are real, if not exactly measurable, advantages; and they all have to be put in the scales against the "paper-£90-million" which the Government say they are going to save. One must come to the conclusion that the damage is not worth the alleged saving.
I think I will end on another point, not as mundane as the advantages to trade and so on. I think that it adds to the character and dignity of the universities—which is one of the things that the word means—to have people from many countries. The university itself is enriched. Our country, said Pericles, in his great panegyric on his own city, is an education to all Greece. We could make a comparable claim on a larger scale. It was one of the glories of this country that we were a centre from which learning radiated throughout the world. I think that the Government have been too hasty to pursue what may be only a shabby economy without regard for certain more permanent values.
Finally, my Lords, if I say little about the British Council, it is not because it is not important, but because I think we shall have an opportunity to discuss that next week. But it is sad at the time when students are going to be put to this immediate difficulty over fees that the British Council which helps them in so many other ways—with grants, with advice about accommodation and generally enabling them to fit into the life of this country—is, itself, to suffer reductions which are going to make it close some of its local centres, reduce the work of the London centre and reduce, I believe, by half the grants that it makes to students. Altogether, I think that we have the signs here of a policy put in with too little forethought and to little imagination; and I beg the Government to think again.
9.23 p.m.
Lord GLADWYN: My Lords, once
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again, thanks to the very welcome initiative of the noble Lord, Lord Stewart of Fulham, we are discussing what we on these Benches regard—and I am sure I am right in saying what the noble Lord himself regards—as the extraordinary and indefensible attitude of the present Government towards overseas students. Once again, we shall no doubt hear the noble Baroness who is to reply on behalf of the Department of Education and Science explaining, with, I am afraid, a certain complacency, that what the students bring into this country on balance by way of foreign exchange is non-existent because it is unquantifiable. Once again, she will read out her brief to the effect that the students must bear what is always referred to as the full cost of their education. Here, in case she still refuses (as she did last time) to accept the argument—and, I think, the irrefutable argument—advanced on this matter in the recent study by the London Conference on Overseas Students, may I quote a passage in a letter to my noble friend Lord Avebury, from the much respected Professor Cattermole of Essex University, one of our leading professors in engineering: He writes:
"The sum of money withdrawn from University Grants Committee funds appears to be the result of multiplying total university costs by the proportion of overseas students. Thus it vastly overestimates the true 'subsidy', in three respects. First, the average cost of any activity is greater than the marginal cost. We need some basic provision for staff, equipment, etc. for British students, and the cost of taking additional students is less than proportional: equally, the savings we could make by not taking them are less than proportional. Secondly, only part of our costs is attributable to teaching: a significant part is attributable to research, much of it to direct utility. Thirdly, the calculation ignores external effects: these are very varied; but include (at least) the money brought into the United Kingdom by overseas students, and the effect on trade of goodwill engendered by British education".
Exactly how much of the alleged £100 million deficit would vanish into thin air were these principles applied to the calculation is open to argument; but no reasonable person can now doubt that by far the greater part of it would. Only the Treasury sticks to its original estimate, so it cannot apparently be changed because, as we all know, Governments always tend to believe that the Treasury is never wrong and is always right. And, of course, if it were changed, the entire Government case would simply go by the board.

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None the less, once more we shall hear that, given the alleged cost of educating overseas students in this country, the only sensible thing to do—this, undoubtedly, is what the noble Baroness will say—is to let market forces loose in the sphere of education, admitting (with some grudging exceptions) only those foreigners who are so rich that they could obviously send their sons to any seat of learning anywhere in the world if they so chose, irrespective of cost.
Of course, as the noble Lord, Lord Stewart of Fulham, has said, it is obvious that, this being so, this will result in a heavy fall in the total number of students. It is impossible to argue the contrary. There will no doubt be a tiny concession regarding postgraduate students, some 5 per cent. of whom we understand may be the subject of special grants, though how they will he selected, and on what grounds, is something of a mystery.
Finally, if only not to infuriate our EEC partners, even beyond the point at which they were infuriated recently in Dublin, we shall probably hear that students from the Community will only be charged about ten times the nominal charges of most European universities. A great concession! Unless there is an unexpected increase in the number of scholarships to be granted to the poor Third World, that will be all. The possibility that by largely exempting EEC students from fees two or three times those charged even in America, we may expose ourselves under the Treaty to the necessity of admitting students from the Lomé Convention countries on similar terms does not seem as yet to have occurred to the Government. No doubt they would be absolutely horrified if it ever did.
Almost all leading academics, I think I am right in saying, are now ranged against these self-inflicted wounds—because that is what they are, rather than cuts—explaining how, in addition to depriving us of undoubted benefits that overseas students bestow on our benighted land, they will probably result in severe hardships from many universities and polytechnics, some of which may have if not to close down altogether at any rate to lower their standards, which would be a terrible thing to do. To no avail: the Government apparently believe that the academics are of no electoral importance,
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I am afraid, and that they have the votes behind them in that the country as a whole does not think much of students—and particularly of coloured students.
Even if it should be the intention of the Government to economise, not so much on account of overseas students themselves, which has already been shown to be no economy, but directly on expenditure on universities and polytechnics, if that should be their sole objective, what is the point of a policy which, far from hitting the more unpopular, and no doubt the least efficient educational establishments which have few or no overseas students, penalises exclusively those institutions which, by reason of attracting students from abroad, are presumably the most efficient and therefore the ones it is most desirable in the national interest to subsidise and maintain? What is the point of that?
The policy, in other words, has not been properly thought out: it has not been thought out at all. It is a kind of blunderbuss which has been fired off almost at random in response to a rather half-baked ideology; and for that very reason it is going to cause infinitely more harm than good. What courses, I wonder, will the sons and daughters of the rich foreign friends of the present Government take? They will no doubt be well able to afford the £5,000 a year necessary to become a dentist. But what son or daughter of an oil sheikh is going to go into that profession, or even to become a doctor, for that matter? Perhaps a few, in the hours they will be able to spare from their attendance at Annabels or the Clermont Club, will be serious enough to obtain a degree in engineering, but not very many, as we might think. Will they take any active part in the extra-curricular activities of the universities and polytechnics which they may favour with their presence? Perhaps that will be beneath their dignity. Probably, in their expensive "digs", they will go in for the soft options, in which case the seats of learning, deprived of grants they can only recover by fleecing the foreigner, may well find themselves even further in the red, because they will only get £2,000 instead of £5,000 per head. And when these rich characters do get back home, what prospect will there be of their providing the men and women who are likely to come to the fore in the next generation and thus create goodwill towards Britain, to say nothing of creating

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trade? Not much. The bright boys of the future will mostly have been well trained in Moscow or in East Berlin, if not, of course, by our main competitors.
My Lords, just listen for a moment to what a director of Balfour Beatty Limited says—they are responsible for some £400 million of contracts annually. I quote:
" In Singapore, Malaysia, Hong Kong, where university education is largely British oriented, we have an in-built advantage: the chaps who have returned from university training in the United Kingdom know its quality and they think in United Kingdom terms. Now in the Philippines it is all the other way: they think in American or Canadian terms, their post-graduate Mecca is a United States university, and, naturally enough, when it comes to placing a huge contract, they look first in that direction. The Americans know it and they encourage overseas students in a number of ways—bursaries, facilities for work, low fees—whereas we are foolish enough to raise the fees time and again. It is utterly short-sighted, and the long-term effects (to our disadvantage) are incalculable ".
Broke we may be, but really, however broke, there is no impelling reason for us to go in for a purely self-defeating exercise.
But quite apart from students who will not come if these extortionate fees are introduced, what about the students already studying here? We understand that the Government have magnanimously agreed to exempt students in mid-course; but what provisions are there for the 37,000 students on preliminary, non-advanced courses? I do respectfully ask the noble Baroness to reply to that question. Are they to be forced to give up before embarking on the higher qualifications most of them came for? I would remind the House that in the only comparable increases imposed by Her Majesty's Government in 1967, students going on to higher courses were cushioned from the differential fees and had to pay a maximum of only £50 extra, which was recoverable in cases of hardship from a special DES fund. Surely something similar to that will be organised this time, or are the Government going to be absolutely hard-hearted and do nothing of the kind?
A couple of years ago the United Kingdom Council for Overseas Student Affairs and the Council for Education in the Commonwealth put forward the idea of a commission, whose object would be to work out and submit to the Government for approval schemes for both regulating and making the best use of overseas students in this country. We
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certainly did not exclude—of course we did not—the possibility of some quota scheme or schemes. We quite realised that there might well have to be some limit set to the total number of students in this country. We did not deny that. This scheme for a commission was not actually turned down by the Labour Government, who were still considering it when they fell. But it was quite soon rejected by the present Government, on the simple ground that it was a Quango—a beast whose extermination, as we all know, has been ordained by Mrs. Thatcher. I am afraid that perhaps the real reason was that it might somehow interfere with the sage confabulations of the civil servants who, in my view, are primarily responsible for the present mess.
Undaunted, we then suggested that at least Mrs. Thatcher might take a leaf out of Mr. Heath's book and give a Foreign and Commonwealth Office Minister—one of the eight, I think—some powers of co-ordination of rival departmental policies, in the same way as these were conferred on Mr. Anthony Kershaw in 1971. Clearly this was an error. The personal assistant of Mr. Blaker, who—that is, Mr. Blaker—had said that he would consider this suggestion seriously, later informed me that it was not acceptable. Liaison between the various departments was perfect, the private secretary said. We must therefore assume that the Foreign and Commonwealth Office is in complete accord with a policy which, as explained by the Mauritius Finance Minister at the Conference in Lusaka, is causing much distress and heartburning in the Commonwealth and great satisfaction behind the Iron Curtain. Apparently, that is what the Foreign Office thinks is a very good policy.
I repeat that I have scarcely any hope that this debate will induce the Government to abandon their foolish plans, though possibly they may modify them to some very slight extent. It is true that the fuss we made here about the proposed slashing of the BBC Overseas Services had some effect, and that when it was repeated in the other place the Government actually executed a U-turn. But I am afraid that there are fewer votes in overseas students, and even fewer in the British Council, which is associated in the popular imagination largely with "culture"—a word which tends to grate on a British ear—and whose

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splendid work in connection with the propagation of the English language and democratic ideas is often quite ignored.
And yet only two years ago this House indignantly repudiated the very proposals of the Berrill Report that have now effectively been resuscitated by a Tory Government. Where are the Tory champions of the British Council now? Where are the defenders of its crucial role in the teaching of English and the propagation of British political principles in the world? They are no doubt terrified of incurring the wrath of the embattled lady who, so we are told, is going in the near future to take on the unions, cure inflation, beat unemployment and lead us to the Promised Land. Loyalty, therefore, before conscience every time! That seems to be the basic Tory principle.
We shall have an opportunity shortly, as I think the noble Lord, Lord Stewart of Fulham, said, to discuss the proposed dismemberment of the British Council, so I shall not enlarge on it this evening. All I would say in conclusion is that it is a sad moment, both as regards students and as regards the British Council, when we turn our backs on the great civilising mission which this nation has for so long performed. If, therefore, these iniquitous proposals ever come before your Lordships in the shape of a White Paper—and no doubt the Government will try to avoid doing that—we on these Benches, at any rate, shall divide the House against them and we shall certainly hope that, as two years ago, a large majority of your Lordships will share our indignation and express it by your votes.
9.40 p.m.
Lord WEDDERBURN of CHARLTON: My Lords, I wish to contribute four points to your Lordships' debate for which we are very grateful to the noble Lord, Lord Stewart of Fulham. I wish to assure the noble Baroness that on this occasion at least I approach the problem in no party spirit or with no party interest. Indeed, I must declare an interest. I hold a Chair in the University of London at the London School of Economics, and on this occasion I speak largely against my background of some 27 years of teaching and research in universities.
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My first point is that it has surely been made quite clear by the Vice-Chancellors and other spokesmen for the universities and polytechnics that they are not asking for any privilege or exemption on the matter of overseas student fees. Given the Government's policies—which it is not tonight's debate to challenge—universities can expect to have their resources straitened and diminished, but what they do not expect is that they should be diminished on a totally irrational and arbitrary basis.
University finance has been said to be in chaos, and partly that is true. Every Government of the last decade, including the last Government, bears its share of the responsibility for that. But the issue of overseas student fees is quite separate from the other diminution of university resources. It is irrational because it is based on a false assumption—insistence by the Government that the cost of overseas students must be calculated on a full unit cost basis; namely, the income of a university divided by the total number of students in that university.
The Government have already rejected —and the noble Baroness rejected it in this House—the report of this year's London Conference on Overseas Students, which argued that the right approach is one of marginal cost. Whether that is exactly the right approach it is very difficult to say, but the full unit cost cannot be right. If I hold a seminar with 30 students and if 10 overseas students are taken away, the cost to the university is not diminished by one-third, as the Government appear to believe. The cost of the building, of salary and of heating the building is the same. And if 10 students are added to the seminar, the cost is not increased by 25 per cent. Whatever the correct calculation may be, the full unit cost cannot be the right one. There is no university in any higher education system in the world which uses the full unit cost as the basis of its calculation for student fees. If it is used in this case, it will make our higher education system the most expensive in the world.
Secondly, if the Government still cannot accept any other basis than the full unit cost, even given what I believe to be a false assumption, how can it be right to deduct from the income of each university—I speak of universities because I know more about them than about polytechnics—a percentage according to the

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percentage of overseas students attending that university, as history and chance have bequeathed that percentage to that university institution? The overall cut is 13 per cent, but taking the percentages which will be applied according to the number of overseas students, it will be 8 per cent. at Cambridge, 29 per cent. at Essex, 11 per cent. at Oxford, 37 per cent. at the London School of Economics, 4 per cent. at Keele and 33 per cent. at the University of Manchester's Institute of Science and Technology. If it were applied to schools, it would be 74 per cent. at the London School of Hygiene and Tropical Medicine. This is a wholly arbitrary way of reducing income. If income has to be reduced, let it be reduced in a more rational manner. As the Vice-Chancellor of Southampton University said in The Times on 27th November:
" The method is appallingly crude. The Government is setting out to prune roses with an axe—and a blunt one ".
It is worse than that. To use the London School of Economics as an example—and I pray it in aid not through any special interest but as an example which will apply to some other universities as well—we have a thousand or more overseas students, many of them very talented graduates. On the Government's calculations, it appears that the full unit cost will come to something just under £3,000 a head, so the deduction will be in the nature of £3 million from the London School of Economic's income. We cannot make up that income by taking more home students. That has been made clear to all universities by the University Grants Committee and the Government. We are told to go out and replace our overseas students by finding others. If we do that and charge the minimum for arts and social science students—as indeed we are bound to do while the market is being tested, because every other institution is charging that figure—we charge £2,000 a head, which brings in £2 million. So, even if we replace every single overseas student, the institution is £1 million short on this arbitrary calculation.
How can that possibly he right? Indeed, what is the pressure on universities?—and it seems to me that this is the point on which the public deserve to be better informed. The pressure on universities is not to take fewer overseas
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students; the pressure on many universities will be to take more overseas students and worse still the pressure on very many universities will be to admit more overseas students not on the basis of academic standards and academic merit but on the basis of whether they can pay. The illogical and irrational result which I cannot believe is intended by the Government is that the universities should become racketeers. Some people say that foreign students are already a racket in certain places. If they are, I do not know of them, but that should be investigated. Certainly, the pressure is to become racketeers and to overcrowd our seminars to the disadvantage of able, and especially able home students, with the sons and daughters of the western world's rich men who are not serious students. I cannot believe that is the right policy to present to universities to replace the stock of talented students who now come for the most part into British higher education.
That leads to my third point—because there is another problem. The Government appear to have taken this decision on the basis that there are suitable overseas students available who can afford these colossal new fees. In your Lordships' House on 7th November in the Official Report at column 813, the noble Baroness herself said, as many Government spokesmen have said:
" The fact is that every time the charges to overseas students have gone up so the number of students in this country has increased ".
That was true between 1976 and 1978, but the Government surely cannot go on saying that now, in the light of their own statements. On 22nd November in another place at column 381, the Minister, Dr. Rhodes Boyson, said:
" In 1979–80 there were about 17,000 overseas graduate and postgraduate new entrants to British universities as compared with 18,672 in 1978–79 ".
That is a decrease of some 9 per cent. and it is not unrelated to the previous Government's increase of fees by 30 per cent. The level was 9 per cent. down on 30 per cent.
Lord ANNAN: My Lords, will the noble Lord allow me to intervene? Does he not think that the decrease in the number of overseas students was due to the request, in fact the instruction, which came from the UGC on the orders of the then Secretary of State, requiring uni-

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versities to decrease the number of overseas students to the figure that they took in 1975 minus 7 per cent.?
Lord WEDDERBURN of CHARLTON: My Lords, I was about to advert to the quota point, if the noble Lord will allow me to develop the argument. There was the factor of the quota which was imposed on universities but such evidence as I have heard from those in charge of admissions in various universities also relates the decrease to the increase in fees. That is to say, two factors were at work, as the noble Lord, Lord Annan, is quite right to remind your Lordships—the quota and the increase in fees. I do not know how many overseas students the noble Lord, Lord Annan, has discussed this matter with, but I have discussed it with a few and it is perfectly clear that the 30 per cent. increase in fees was a factor in that 9 per cent. decrease. What can we expect in 1980–81 after further fee increases of between 100 and 400 per cent.?
On 28th November Dr. Rhodes Boyson, during a debate in another place (at column 653 of the Official Report), said:
" Some fall in the total number of overseas students is anticipated in the academic year 1980–81 but it is not possible at this stage to predict what that proportion will be ".
I suggest that there is now on the record a very great weight of evidence predicting on reasonable grounds what that fall may be. Perhaps I may select four published statements out of dozens. On 15th November in The Times the Master of Balliol and two other heads of houses in Oxford estimated that they would lose between one-third and a half of the number of our overseas students. On 29th November the Daily Telegraph reported a spokesman of the University of Bristol as estimating a drop of about one-third. In the Observer of 18th November the noble Lord, Lord Bullock, Master of St. Catherine's College, Oxford, estimated the loss of about a half.
In The Times Higher Educational Supplement on 23rd November Professor Haszeldine, the Principal of the University of Manchester Institute of Science and Technology, was reported as estimating that between 35 and 40 per cent. of his overseas students would be lost. And he added:
" If that were the case the university would no longer be able to pay its fixed costs ".
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University after university is predicting, after a careful look at the matter, that something like 30 per cent. at a conservative estimate is the probable drop in the number of students.
On 27th November the right honourable gentleman, Mr. Rhodes Boyson, answering for the Secretary of State in another place, said:
" The Government have no plans to close down any British university within the next five years ".
The Government, I suggest, are obliged tonight to tell us how it is going to avoid that, if not by planning at least by mistaken policies, because the cuts which have to be suffered by some institutions risk closures of departments and possibly even of some institutions themselves.
That brings me to my last point. Dr. Page, the Vice-Chancellor of Reading, said on 14th November that the new fees—and I quote:
" could price British universities out of the market for overseas students. The consequent fall in university income would have disastrous consequences for home and overseas students alike ".
The consequences for our own home students will not be felt only in closures or redundancies. The international character of their educational environment, which matters a lot to many people in universities, will be seriously impaired. Moreover, universities which have for decades been centres to which foreign students have looked, and especially students from the Commonwealth, will find the role that they play fading away. Special arrangements, it seems, are probably to be made for EEC students. That one can welcome. But one half of the foreign students in universities are from the Commonwealth. Already since 1977 various factors have caused a huge drop in the number of students from the poorer countries, over 20 per cent. from Kenya, over 20 per cent. from India. Although I accept that the quota is a factor, it cannot be an accident that the larger drop has come from the poorer countries. The fee increases are clearly a major factor.
Students are telling us—by which I mean myself and the colleagues to whom I speak every day—students from the Commonwealth, from Canada, Australia, Nigeria, are telling us every day, that next year those behind them from the universities who would like to come

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here will not be able to afford it. They will go to the United States—and, as the noble Lord, Lord Gladwyn, says, no doubt in some cases to Eastern European countries.
There are various educational bodies throughout the world which are expressing alarm at the Government's policy, and if the Government will not listen to British voices perhaps they will listen to voices abroad. I quote one example, of which I could send the noble Baroness a large number. The Council of International Educational Exchange in the United States, which represents 170 colleges and universities and educational organisations in the United States, on 7th November at its meeting in New York City unanimously passed a resolution urging the British Government to reintroduce arrangements for the reception of overseas students on conditions no less favourable than those obtaining for United Kingdom students as soon as possible. I quote again:
" The object was preserving and strengthening the strong ties which have meant so much to the development and dissemination of knowledge and for mutual understanding between our nations ".
The international position of British education is also something which is at stake. Everything which has so far happened has proved how correct was the perception of the chairman of the Vice-Chancellor's Committee, Sir Alec Merrison, who spoke on the 16th October 1979 on behalf of all the Vice-Chancellors in saying:
" The effect of these policies upon our universities and students both from home and overseas is potentially disastrous. They will undermine institutions which are vital national assets and of international renown ".
Sir Alec Merrison went on to say that his committee, the Vice-Chancellors, implored the Secretary of State to think again. I would join in asking the Government what are their plans for the many university institutions which, with present policies, will in 1981–82 face very large deficits indeed. They may face closures of departments or institutions, but they will not be closures which are planned on academic grounds. If there is a case for the closure of certain departments, or indeed of certain universities, then let that case be made. Let it be made rationally and in a way that can be dis-
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cussed. But closures which are the erratic spin-off of an irrational policy on overseas students' fees which apply arbitrarily, by the accident of history, according to the percentage of overseas students who happen to be at a university in any particular year—that is a policy of chaos.
The noble Lord, Lord Bullock, the Master of St. Catherine's College, Oxford, was surely right when he urged the Government, in his letter to the Observer on 18th November:
" To postpone the scheduled increases and institute instead a thorough-going inquiry … into the whole question of overseas students ".
If there are undesirable practices as regards the presence of overseas students in certain departments or universities, let the case be made. But, for those of us who are teaching in the universities, the present policy means that in two years' time it may well be found that, for the sake of £100 million—or 10 Jaguar fighter planes—a heritage of higher education has been irreversibly damaged and totally changed in a way which I cannot believe is the intention of the Government.
9.57 p.m.
The LORD BISHOP of OXFORD: My Lords, after the recent welcome reappearance of The Times, three supplements of obituary notices were published of distinguished persons who had died during the past year. It was immediately striking how many of those scholars and scientists who had rendered long and outstanding service to this country had been born outside her shores, but had received a welcome, first from the academic community, and later from our people as a whole.
The policy of the Government towards overseas students, as evidenced by the proposed steep increase of fees in 1980–81, appears to run counter to this tradition, at once admirable and profitable, in British life. The arguments for such drastic increases are, so far as I am aware, entirely those of short-term economic benefit. It is right to underline the word "short-term" for it surely cannot be doubted that the education and training of overseas students in the institutions of this country have in the long term benefited our economic interests with the students' various countries of origin. No doubt these benefits are difficult to

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compute, but it is not a negligible argument which has been advanced by the London Conference on Overseas Students that the consequent trade benefits and the foreign exchange brought into this country together outweigh the alleged drain on our economy which has impelled the Government to make such a drastic increase in fees.
Moreover, the figures which have been quoted must raise a doubt whether the full-cost fees proposed for overseas students embarking upon new courses from 1980 genuinely represent the actual costs, or whether they are being used as a partial subsidy for home students, and one which many home students, be it said, show no signs of desiring themselves,
We have heard the suggestion that universities should, in effect, have their normal grant cut by the amount they are expected to "earn" from overseas fees. Such a suggestion seems highly inequitable both to the universities and to the overseas students, and when the world market in institutions of higher education is surveyed, it appears that we shall be in serious danger of killing the goose that lays the golden eggs—even if it sometimes takes a few years to lay them.
It would, however, be a grave reduction of the moral and intellectual perspective on this question, to speak of it only in terms of cost benefit. Even if we were to grant the Government's case as far as the economic arguments are concerned—and it seems to have been severely damaged already this evening—there is a moral obligation on the part of this country which the present proposals appear to disregard. The Bishops of the Church of England, the Church in Wales, and the Episcopal Church in Scotland, meeting in Salisbury last June expressed themselves as follows:
The welfare and proper development of many overseas countries depends on the building up of an educated leadership, and we believe that this country's continued contribution to that end, through the availability of educational opportunities, far outweighs any economies that may be effected by the present proposals ".
The building up of that educated leadership is probably the most priceless asset
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that any developing country can have. It has been one way in which Britain, even when unable to offer large-scale direct aid in financial terms, has played a notable part in the formation of a stable, political and economic life in developing countries. It would surely have to be a very substantial gain indeed—not one of the order of £90 million per annum, as projected—that made us resolve to sacrifice that constructive place in the affairs of other continents and countries and hand it over on a plate (for many of these students will assuredly seek their higher education outside their own countries) to more liberal hosts in North America, or Eastern or Western Europe.
It is a comparatively rare issue that drives the House of Bishops and the National Union of Students, not to mention the principals and vice-chancellors, to make common cause. The fact that this issue has done just that may be taken as a clear indication of the amount of feeling that there is against the proposal of the Government to establish the highest fees for overseas students in the civilised world. It may be argued that these bodies, taken together, represent only a small section of our population as a whole, and that they contain a number of interested parties. Yet there are times when academic communities are capable of arguing not merely for self-interest but for enlightenment and justice with regard to national affairs as well as their domestic ones. What else do we have universities for?—and, indeed, churches?
We are anxious, for the sake of Britain's good name and her place in the international community, and especially that of the future leaders of that community, to resist the present tendencies towards an illiberal prejudice against foreigners as such, for that is how it is bound to appear to public opinion both at home and abroad. We believe that in this case moral principle and a realistic estimate of our country's long-term gain point in the same direction, and the direction is that the Government should think again and modify very considerably their proposals for a swingeing increase in fees upon overseas students, irrespective of their ability to meet them.
10.2 p.m.
Lord ANNAN: My Lords, your Lordships will know only too well by now that I do not share the views of the Committee of Vice-Chancellors about overseas students' fees nor, I regret, the views of the vast majority of my colleagues in the universities. Of this recent increase I shall just say this. The Government were elected on a mandate to cut public expenditure and this evening we have not yet heard one word about the economic recession which faces the world and with which this country, with its declining industrial strength, is unfortunately faced. I support the Government in their aim, that they must cut public expenditure and I do not blench when it affects the universities in which I work. But I do wish that, when they do cut it, they will not try to disguise the cut with a lot of twaddle about imposing an economic fee on overseas students. If I do not again rehearse the argument about marginal costs, that will be because it has already been done so ably by former speakers.
I noted the remarks of the noble Lord, Lord Gladwyn, about the quality of students who would be likely to come to universities if this way of calculating overseas students' fees is observed, but I regret to say that I do not share his view at all. The overseas students who will come will not be composed solely of polo-playing playboys. In fact, as we well know, I would guess that Chinese parents in Hong Kong and Malaysia will not be deterred by the new level of fees. They are the shrewdest of entrepreneurs and they know value for money when they see it. A three-year degree in engineering or law, taught in English at a staff/student ratio of one to 10 or even one to 15, is from their point of view a snip.
Lord GLADWYN: My Lords, I apologise for interrupting the noble Lord, but why should a shrewd Hong Kong merchant, however rich he may be, who wants to send his son to the best university, choose a course at a university here when he could equally send his son to America, where he would receive a better technical education for half the price?
Lord ANNAN: My Lords, I really must disagree with the noble Lord about the choice. The staff/student ratio in an
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American university at undergraduate level bears no relation to ours. Ours is infinitely more favourable. That is why there will still be numbers of these students who will come to this country. They are very able and clever students indeed. Just look at the class lists in the University of London in engineering and you will see Chinese names very often in the first class.
Of course it cannot be denied by the Government that inevitably students from poorer countries will in fact not come, and that among these will also be some of the ablest students. I shall not at this time of night retell the sad story of the universities' folly in turning down flat Mrs. Williams's 13 points which she put to them in 1969. They were points for saving money in higher education. One of those points was overseas students' fees. Of course the Vice-Chancellors like to argue that the Government got themselves into a terrible mess by not only expanding universities but by creating 32 polytechnics, upgrading the colleges of education, and creating the Open University. The Robbins proposals alone required a growth rate of 4 per cent., and we never achieved that.
I am afraid that my colleagues often seem to expect the Government to behave as if it was a student working out problems in algebra which are susceptible to rational answers. I do not believe that Government is like that. If instead we each of us did not take such a pride in fighting our own corner, and behaved less like syndicalists and tried to help the Government, whatever party forms it, I believe this country would be better off. But no, on this issue the universities have always decided to paddle their own canoe. Now, owing to the economic recession, the universities find themselves up an evil-smelling creek without a paddle.
If in the old days one asked what percentage of overseas students the universities thought it legitimate for Britain to admit, one never could get an answer. If one asked was 10, 20, 30 or 80 per cent. of available places a correct figure, no one would ever answer. I myself have always been in favour of a quota once I realised that this was the only way in which this problem could be contained. I was a

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little surprised to hear the noble Lord, Lord Gladwyn, unless I misheard him, come out in favour of a quota tonight, because in times gone by I have always understood that he did not feel that that was the right way of tackling the problem, but I welcome that support because I believe that it is.
I think that the fees have been raised to a dangerously high level, but the trouble is that no one now believes the universities. I think that now several Vice-Chancellors would in fact agree with these views. There are several who now believe that the protests which have been delivered absolutely consistently in the past whenever fees have gone up have diverted attention from a much more serious problem. So therefore I am not asking the Government to reverse their policy; obviously they are not going to do that. It is not actually the principle of charging higher fees that I object to, it is of course the dramatic drop in the income which the universities are now going to have to face. It is that dramatic drop in income which makes me tonight ask the Government to be prepared, if necessary, to give emergency help.
My colleagues believe, as we have heard this evening, that in three years' time we shall be lucky if we get 30 per cent., 50 per cent. perhaps, of the overseas students that we now get, if we charge the minimum fees. Now I would much have preferred a settlement which took only 80 per cent. and not 100 per cent. of the overseas student cut from the universities. But I ask the noble Baroness: Will she give us an assurance that the level of fees will be reviewed in 1981 or, at the very latest, in 1982?
We have some cause to doubt that the new fee level is competitive. Harvard and Berkeley California, for example, are certainly, if you contrast the level of science and engineering fees, more favourable and, despite our bad track record in the past, the universities could this time be right. If they are right, then, as the noble Lord, Lord Wedderburn of Charlton, said, real damage will be done.
As the noble Baroness knows, the universities are being subjected to a double
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cut; there is a cut in real terms as well as the potential cut in income from the overseas students. The base line for this year has already been reduced and I must tell the noble Baroness what this will mean for the University of London because the University of London is a curious place; not merely is it the university of the capital city, it is the mother of universities from all over the Commonwealth which for years took London degrees, and we are bound therefore to have more students from overseas than any other university.
It is not just a percentage of 19 as opposed to 13, the national average, that makes me say that; it is simply that there are whole institutions which over the years Governments have encouraged London to develop. It is those that will be at risk and I must tell the noble Baroness that unless we get some special recurrent funding, we calculate that the London School of Hygiene and Tropical Medicine, mainly concerned today with preventive medicine, the Royal Postgraduate Medical School, most of the institutes in the British Postgraduate Medical Federation and certainly the School of Oriental and African Studies, which was built up by the Scarbrough and Hayter funds, will close or become unrecognisable as the institutions they are now.
I hope the noble Baroness will believe me when I say that that is not a crude blackmailing statement; London will not adopt that course of action which will be most embarrassing to Government. But the rest of the schools in London University cannot carry these institutions by tightening their belts. They too are in trouble and, as we heard from Lord Wedderburn, the London School of Economics and, I can assure the noble Baroness, University College and Imperial College, forecast very heavy deficits if a policy of this kind, of the double cut, is carried through. The trouble is that London is a high cost university; the London allowance alone costs us £12 million. If that is the kind of calculation which, on this so-called free economic fee, is taken into account, no wonder we shall be so very embarrassed by the size of the cut.
But whatever happens to overseas students, I predict that with the present cut which is being imposed, some academic staff will have to be dismissed because we

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shall not be able to pay them. I have no doubt, in a way, that that is what the Government want. After all, that is what cutting public expenditure means. However, I feel I must warn the noble Baroness that the first member of the academic staff to be told that there is no money to pay him or her will, I would guess, be advised by the Association of University Teachers to fight his case in an industrial tribunal on the grounds not that he is being made redundant but that he has tenure to retiring age and that if the contract is broken he must be compensated accordingly.
May I therefore ask the noble Baroness if she will initiate now within the department discussions similar to those which took place when the recent closures of colleges of education occurred? The universities must surely have a national policy for the dismissal of staff and they are going to need such a national policy possibly sooner than we like to imagine; I do not mean next year and I do not necessarily mean the year after, but certainly in the third year of this policy I would expect that to happen.
If the noble Baroness tells me that the experience of the Crombie scheme so appalled the Department of Education and Science that they are never going to repeat the exercise, I shall not be entirely surprised. But again may I respectfully warn her that dismissal of staff will cost money. Government will have to supply that money if long-term savings—which they apparently want and which, naturally, they view the economic situation as dictating—are to be made.
I have not discounted the possibility that the present cuts are designed to make the universities live for a year or more off their reserves. Everyone is now talking about their reserves. The Public Accounts Committee are talking about their reserves. The AUT are talking about their reserves, so that universities can settle salaries at a 15 to 20 per cent. increase. But in most cases the reserves that exist exist for two reasons. The first is to maintain buildings—and some of the buildings are extremely old and are crumbling, and cost the earth to maintain. The second reason is that in the past Government finance has gone in this way.
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Government have announced an inadequate grant, and then in May or June, at the end of the academic year, have sent the universities supplementary grants which are not therefore built into the baseline and which have to be treated as non-recurrent money. I understand that, under the new Government policy of cash limits, this will not occur, but perhaps the noble Baroness can tell us whether the Government have a policy concerning the reserves of universities.
The matter of overseas students' fees was only one of the 13 points which Mrs. Williams put to the universities in 1969. In my judgment the cuts which the universities are now facing are only the beginning, because not only will public expenditure continue to be cut if the world recession deepens, but in the mid-'eighties the fall in the birth rate will enable the Treasury to demand—as they have in the schools—that the academic and associated staff in universities be reduced. That is another reason for immediately setting up machinery to deal with the problem of dismissal of staff.
But I believe that there is another reason for those 13 points to be thought of again. Dr. Rhodes Boyson has said publicly that he does not want the universities to descend to a general level of grey mediocrity—which is exactly the point that the noble Lord, Lord Wedderburn of Charlton, was arguing. Dr. Boyson wants élite institutes such as the London School of Economics to be given priority. But this grey mediocrity will result if the universities do not consider how they can help Government. May I ask the noble Baroness whether she will invite her right honourable friend the Secretary of State to initiate discussions with the UGC and the Committee of Vice-Chancellors to work out a long-term plan for the cutting of costs, so as to maintain some institutions at their present rate of funding? Please do not destroy the top quality of research and teaching, even if inevitably in some places, in some departments, there must be a reduction.
I also wonder whether the agenda should not cover the possibility of various other points that were proposed at that time, 10 years ago, such as the two-year degree. Should it not also include designating some universities or institutes,

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or departments within universities, as the equivalent of the grandes écoles in France? I put this suggestion forward in a debate in your Lordships' House on 31st March, 1976, and I still think that it deserves study. The country cannot maintain the present level of teaching and research in all our institutions of higher education, but we can preserve it in some places in some of them.
10.19 p.m.
Viscount AMORY: My Lords, if I may say so, the noble Lord, Lord Stewart of Fulham, has put down a very timely Question. I have no grounds to speak with one hundredth part of the authority of the noble Lord, Lord Annan, on the subject; I was most interested in what he said. One remark he made almost caused me not to speak at all. That was when he referred to polo-playing playboys. I instantly recalled that in the days of my youth, playboy or not—and looking around, the only Member of your Lordships' House whom I can see who knew me in those days is the noble Lord, Lord Gladwyn—I did once participate in a game of polo. If that puts me outside the parameters of qualifications to speak in this debate, my Lords, I must at once resume my place.
My Lords, most of us understand the need to contain and, if possible, reduce the present level of public expenditure as a proportion of our current national income. As politicians, we also know that to restrain policies to which people have become accustomed is far harder than initiating new policies. Whatever methods the Government adopt are likely to prove unpopular. Each of us wants our own particular enthusiasm exempted. It is easy to agree that a particular cut will prove a false economy in a broader context; but unless we want the effort to contain aggregate public expenditure to prove abortive, I believe we are bound to accept that, with very few exceptions indeed, every public service must have some quite severe restriction imposed upon it—and universities, I am afraid, are no exceptions. Indeed, it is clear that the restrictions to be imposed on the universities are going to be quite painful to them, and will involve some reduction in the number of home students.
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The assurance of level funding, as it has been called, is proving a delusion, and is involving considerable confusion. The delays in notifying university authorities what they are going to have to spend in the year ahead, or in the current year, are very worrying to them. But the question with which we are concerned this evening is not university finance in general, but the level of overseas students' fees. Here, again, I believe we must be realistic and keep things in perspective. During the past decade, as has been said, the number of overseas students has more than doubled, and that is something of which we certainly have no reason to be ashamed. There seem to be wide variations in the individual resources available to different overseas students. Some are well endowed, others exceedingly hard pressed. But in view of the current rate of inflation in the United Kingdom, some increase in their fees seems unavoidable.
The question to me, therefore, is how much, and whether the fees charged to overseas students should in some way be more selective, if necessary. If the fees are drastically raised, as is proposed, the financial effects on some universities are going to be very severe, and, in the case of most universities, substantial. In the only university that I know at all well there are at present about 300 overseas students. They are much welcomed by the university. If, as a result of very sharp increases in fees, one-third of them, 100, are lost, that in purely financial terms means a loss to the university of at least £200,000, and perhaps more. But more important in the view of university authorities, I think, is that if the present flow is sharply reduced it will reduce an influence which is very beneficial to our country, both in the short-term and, more important, in the long-term, too.
While, therefore, I believe that some further increase in fees is justifiable, and indeed inevitable, the present proposals are, I think, too harsh. I hope the Government will, as they did in the case of the BBC External Services, as the noble Lord, Lord Gladwyn, said, sit down and discuss with those who best know the problems involved some way of mitigating the harshness of the discouragements to overseas students who want to pursue their studies in the United Kingdom, and particularly those from the poorer Commonwealth

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countries, from which we have traditionally welcomed students.
I say that as an old Treasury man; because perhaps as an old Treasury man, I might have been expected to say precisely the opposite. But I covered myself by saying that I do not think that anybody could feel more strongly than I that we should contain overall Government expenditure as a proportion of our current income. I hope, therefore, that the Government will think this problem right through before they reach final conclusions. I should like to say how glad I am to see with us this evening my noble friend Lord Boyle after his recent illness. I trust that when he comes to speak in his turn that my one-time Financial Secretary will not say precisely the opposite of the few and far less authoritative remarks made by an old colleague.
10.26 p.m.
Lord GARNER: My Lords, many noble Lords taking part in this debate must have the feeling of having been here before because we have discussed this subject so frequently over the years. However, there are two differences, at least, on this occasion. The first, as the noble Lord, Lord Annan, and the noble Viscount, Lord Amory, rightly pointed out, is that the needs for reduction in public expenditure are very strong and far more stringent now than perhaps previously. Secondly, I must recognise that many of us, I included, expressed fears on previous occasions which do not seem to have been completely fulfilled in practice. But I must say that there is a big difference on this occasion in that the plans proposed suggest such a staggering increase as to amount almost to a difference in kind rather than in degree, particularly because, as has been said by other speakers, the incidence on individual institutions is far more disastrous than on some others because of the application of a rigid mathematical formula.
There is much that I could say on the general question, but I want to be brief at this hour and I am afraid, as I have already explained to the noble Baroness, that I may have to leave before the debate ends; so I will confine myself to one particular institution with which I happen to have been associated and treat that as an example. Some years ago, I succeeded
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the noble Lord, Lord Coleraine, as President of the Royal Postgraduate Medical School and was very honoured to do so because it seemed to me that here was an institution in the forefront of medical research; it enjoyed an international reputation; it was pre-eminent in the training of both practitioners and teachers both in the United Kingdom and overseas. Standards of this sort take time to develop and traditions of value come only with the years. When they are there, one should build on them; once they are destroyed, they are very difficult to replace.
As we have already heard from the noble Lord, Lord Annan, who mentioned a particular case, we are faced with a situation in which much of this might be thrown away. The present plan—I understand that it is merely a plan—hit the Royal Postgraduate Medical School (as indeed it did a number of institutions) doubly, as the noble Lord, Lord Annan, has said; and, first, by the insistence of a charge for overseas students. Here, we have conducted our own market research among the students to try to get the best estimate we could of what would be the likely effect of charging the minimum fee of £5,000. The result that we had (and it may not be absolutely accurate) is that the numbers of overseas students are likely to be reduced to one-third—reduced by two-thirds and not by one-third, as we have heard in a number of other places. That may or may not be so, but it gives an indication of the seriousness and the dimension of the problem. The second form in which the school will be affected is by the very severe reduction in grant with the result that, if the plan were carried out, the income in 1984 would be little more than half what it is now, if as much as that. No institution can hope to carry on the full complement of its work on that basis.
Therefore one is entitled to ask the Government whether they accept the view which the school certainly holds, and a view which has been endorsed by all visitors to the school from the university, from Government departments and other independent authorities, that it plays a vital part in the National Health Service, together with its co-operation with Hammersmith Hospital; that it makes a unique contribution in training and in

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research; and that it is one of the most important factors in maintaining the prestige of British medicine throughout the world.
From a Government which have made clear their belief in maintaining the standards of excellence and wish to promote enterprise when special genius is involved, one would naturally expect an affimative reply. An affirmative reply itself is not sufficient without the will there to attain the ends. I must make it clear that unless some other arrangement—one can think of a variety—can be made, the dire consequences that have been suggested might ensue. I do not believe that this will be allowed to happen; I do not believe it can be allowed to happen. Sometimes I seriously wonder whether all the departments involved in the Government fully realise the implications of what is being proposed.
I pose this question to the Minister tonight—not expecting an immediate reply, of course. There is an importance in the matter because we must know where we stand so that we can plan sensibly for the future. It is important not only in itself, but in relation particularly to staff and morale in the school:
" Hope deferred maketh the heart sick ".
Coming on top of all the cuts and reductions that one has endured over recent years, this further blow could be a cold douche to enthusiasm. Here I should like to pay tribute to the dedication and devotion of the very distinguished members of the staff. We must really try to get away from the present atmosphere of frustration and uncertainty, and be able to see the goal clearly ahead.
I believe in this country. Clearly some things are not going too well at the moment; clearly there is a need for financial restraint. I believe that there are some things that we in Britain do superlatively well which are of benefit not only to ourselves, the people in these islands, but also throughout the world. One of these is the high standard of medical practice, teaching and research. This could be at risk, with the danger of our falling into the category of a second class country in this important field where we have excelled for so long. I beg the Government, therefore, to think again before irreparable damage is done.
10.34 p.m.
Lord KILMARNOCK: My Lords, I do not want to assist in an operation of overkill but simply to make a few simple observations. It seems to me rather hard to arrive at a sophisticated breakdown of institutional expenditure per full-time pupil or student from public funds. I understand that the Tress-Brown index has come up with a figure of roughly £2,000 across the board. This must be the hub of a fan of costs ranging from somewhat lower to somewhat higher figures. This median figure (and some which appear in the CSO Statistics for Education, vol. 5) support the view that average cost per student is somewhat less than the department wishes to impose.
If universities, polytechnics and other further and higher educational establishments are being asked to make up a considerable part of their funding by the proposed increased charges to overseas students, this is a very vital part of their economy, and it is surely reasonable to allow them greater flexibility in what they charge. For example, Lancaster University was charging £1,230 last year for a full-time graduate student from overseas and £940 for full-time undergraduate students. What are they to do now? I think they had 484 overseas students last year. Reading says it will be in a terrible mess. There is a severe danger that an orchestral course that I know of, costing roughly £2,000, may be obliged to charge £3,000 and so on.
I fail to see how it can be sensible to lay down blanket minimum "economic" fees where costs vary widely and where many establishments would be happy to fill in some of their courses with students who are "marginal "—and I do not apologise for referring again to this question of marginality. It may be marginal in terms of expenditure but not in terms of income. Obviously, many universities have achieved a fixed level of resources—staff, buildings, libraries, and so on—which causes them to calculate student numbers in terms of "marginal utility", while the DES continues to work on a flat cost per student. I cannot see any reason why the useful principle of "marginal utility" should not be encouraged rather than banned. I should like to ask the noble Baroness to comment on that point.

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My plea, in the first place, is for greater flexibility. After all, in the university and higher education system in this country we are fortunate in having highly responsible and able vice-chancellors, principals, registrars and bursars, some of whom are here this evening. It seems to me they must be given a wider field of manoeuvre and allowed greater flexibility in the application of these rules which have been, correctly I think, described as "crude "—" cutting roses with an axe "I think was the phrase of the noble Lord, Lord Wedderburn.
A further strange anomaly will arise if the Government's policy is pursued rigidly. It is a matter of simple domestic book-keeping and affects the funding of overseas students by the British Council, both through its own direct scholarships, which are at present around 500, and the scheme it administers on behalf of the ODA, which affects about 8,000 students. It seems to me absurd to tell the council, on the one hand, to cut its coat according to its cloth and, at the same time, to require it to pay, both on its own behalf and as an agent for the ODA, moneys and fees that will in many cases be higher than the full economic cost of courses in Arts, Economics, Political Science and so on; and to pay them to British educational establishments which would in those cases prefer to charge less, and could economically charge less, particularly if the principle of "marginal utility" is allowed to apply.
This is surely robbing an impoverished Peter to pay a reluctant Paul—and all inside the British domestic economy with no overall cut-back in public expenditure. It will simply mean the council will be able to fund even fewer scholarships, to the detriment of overseas students, in the majority of cases from the poorest countries, and at British universities, where the council was previously able to place these students. Surely, in a civilised and responsible society, it is possible to allow the British Council to liaise with universities and other further educational bodies and allow them to place students at reasonable fees to be agreed, where it can be shown that there is no additional public expenditure. This is an extension of the principle of reasonable flexibility. I end with a short quote from a letter from an old friend with vast experience of higher education in the Midlands. He writes:
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" Academic registrars and admission officers hope and pray that the Government will not be too drastic and that the proposed minimum fees will be reduced ".
10.39 p.m.
The Earl of LISTOWEL: My Lords, I have had something to do with overseas students, mainly African students from African Commonwealth countries, since I came back from Ghana in 1960, and that, I think, is my excuse for intervening in this debate. I am not animated by any political motive. Let me say, before I go on to my very few remarks, that I must apologise to the noble Baroness, Lady Young, in case I am not here at the end of the debate to listen to her reply. But I shall, of course, read it with the greatest interest in Hansard tomorrow morning, if that is the case.
I do not think a single speaker during the course of this debate has agreed with the Government's proposal for the increase in the fees for overseas students made in the White Paper, and I must say that I am deeply concerned about it. My main plea will be for the Government to think more carefully about the consequences of this decision before it is implemented. I am sure that it is true of Government policy, as it is of our own decisions, that we should, before we are absolutely certain, try to work out all the consequences and implications of what our actions on those decisions will produce.
It seems to me surprising that both the universities and other institutions of higher education in this country and the British Council, all affected very much by these proposals, have not as yet been fully consulted. The noble Lord, Lord Stewart, said that this preliminary work has not yet been done and that the Government should make their own inquiry. I entirely agree with that suggestion. I am told that the Overseas Students Trust, which of course knows more about the problems of overseas students than any other body in this country, is going to make an inquiry of its own, and I should have thought that such an inquiry was well worth waiting for, provided that it is proceeded with speedily.
I think, also, that the foreign and Commonwealth Governments who send students to this country should he brought

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into consultation. It would surely be disastrous for the policy proposed by the Government to be put into effect without such a careful consideration of the educational and political consequences, which might be a retaliation for what we have done, and those consequences, educational and political, should be weighed by the Government against the small economic advantage that they would gain.
I should like to suggest that such consultations, both here and overseas, should take place immediately and that there should be no increase in fees for overseas students, beyond the increase required by the rate of inflation, until such consultations have been completed and properly assessed. I noted that the noble Viscount, Lord Amory, who as usual took a very balanced view, said that he thought the increases proposed by the Government were too harsh.
I think that some unofficial reactions, which have come to my attention from some of the Commonwealth representatives in London, show what the attitude of the new Commonwealth is likely to be. My old friend Sir Leckraz Teelock, High Commissioner for Mauritius, has said—and he has allowed his words to be quoted—
" Now only very rich people will be able to study in the developed countries of the Commonwealth ".
Another comment—and, again, the High Commissioner has allowed this to be quoted—has come from Dr. Mattieri, High Commissioner for Sierra Leone. He said:
" We sent our boys to fight for you in Burma in the last war and even in the First World War. Now you are excluding us on the grounds of poverty ".
Indeed, the high level of the proposed university fees, which would make our universities among the most expensive in the world, will work most inequitably as between the new and the old Commonwealth countries. The poor, developing countries will not be able to afford these fees, while the affluent industrial countries will in many cases still be able to meet them. This is particularly unfortunate when it is remembered that the vast majority of Commonwealth students come here from developing countries. In the past these students have been one of the most valuable Commonwealth ties, and
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their loss will be a loss to the whole of the Commonwealth.
My second suggestion, which I hope the Government will consider, is this—perhaps the noble Lord, Lord Lyell, will pass it on to the noble Baroness, Lady Young, whose absence at the moment I quite understand because she has been here from the very beginning of the debate. Even if the Government do proceed to increase the fees of overseas students—and some reduction in expenditure in all directions is, of course, inevitable in the present economic climate—I wonder whether an exception could be made for all postgraduate students, not just the 5 per cent. which I believe the Government would be willing to accept. These students are, after all, the intellectual élite of the countries from which they come, and such contacts at an impressionable age may be of great value to us, as they have been in the past, when these students return to take up responsible posts in their own countries. Moreover, they almost certainly lack at home the facilities they need for postgraduate work, which can only be found abroad. Most of these new Commonwealth countries can provide the majority of the university places in their own universities but not, of course, provision for research.
My final argument for accepting postgraduate students is that research work in their chosen field of study will add to a common fund of knowledge. It will benefit us as well as them and make possible that international collaboration on which the advance of knowledge in every field depends. I cannot believe that the cost of continuing scholarships or reduced fees for postgraduate students from overseas would not be ludicrously small as compared with the advantage of preserving this country as a Commonwealth and world centre for postgraduate teaching and studies.
10.48 p.m.
Lord ROBBINS: My Lords, in rising to make a brief contribution to this debate, may I make things clear as regards two questions which I am not going to argue? First, I am not going to argue against any cuts in real grants to higher education in general. In the present financial crisis some cuts are, in my judgment, probably inevitable. I often tell friends who grum-

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ble in a diffuse way about the uncertainties in this connection that while, for instance, staff/student ratios in the universities of this country remain at their present favourable level they had better confine their complaints to fellow countrymen rather than indulge in them abroad, because if they indulge in them abroad, where in general staff/student ratios are so much less favourable, they may be greeted with mirth.
Secondly, I am not going to argue against some raising of fees in general. Provided always that local support is given to those who cannot afford the cost of higher education, I see no objection to some raising of fee revenue in relation to grants. Having made those two points clear, I want to define my target: the subject of our present debate, which is the effect of current proposals for university finance, especially discrimination between foreign and domestic fees, upon institutions catering at a high level of graduate students in particular.
I shall not dwell on the moral aspects of this policy. Perhaps one ought not to get too agitated about this aspect of the problem. After all, discrimination is practised in Eire and in certain parts of North America. I will only say that I personally find it distasteful to say to students coming from abroad with adequate qualifications, "Oh, you come from Bohemia, I shall therefore have to charge you x per cent. more than a home student ". I may be squeamish in these matters but if I think of the duties of those who under present instructions will have to do that I am reminded a little of Adam Smith's stricture—which I hasten to say does not apply in the least to the noble Baroness—and I am distressed that I find myself probably about to venture on sentiments with which she will disagree. The stricture of Adam Smith's which goes through my head is that the sneaking arts of underling tradesmen are thus erected into political maxims for the conduct of a great empire. But perhaps it is all a matter of taste.
What I want to argue is that the system proposed is going to hit very hard those institutions which have the highest reputation for study at the graduate level—a level which until recently had not been attained by all the university institutions in this island. I speak on this subject
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with less than the diffidence with which I usually approach speaking in your Lordships' House, since for more than 20 years I had the honour to be chairman of the graduate school of one such institution, the London School of Economics. I shall argue first that the policies announced are inimical to the atmosphere and reputation of these institutions, and secondly that they may be financially disastrous.
I shall not linger long on the first line of argument. Anyone who has had firsthand acquaintance with a first class graduate school will testify how much it usually owes to the mixture of students from various parts of the world. Anyone who has travelled about the world in quarters of politics, business or learning will know how much the reputation of this country depends upon the dispersed loyalty and respect of the foreign alumni of such institutions. To use the term used by the noble Baroness, this may be non-quantifiable but it is, I humbly suggest, an unquestionable fact. But I must emphasise—and this has already been emphasised very strongly by other speakers—the probable disastrous effect of the proposed policy. Apparently it is thought that the numbers of high-grade foreign students will be maintained. With respect, I would say that that is likely to prove pure nonsense.
The impression seems to be that increases of the order of magnitude contemplated will not deter desirable entrants. Perhaps it is thought that possible increases from Opec countries and elsewhere will more than offset applications from poorer but very high-grade students from other parts—and in "other parts" I include the United States and Canada, not all of whose citizens possess the wealth of the Kennedys. My Lords, it does really stand to reason that a great many highly desirable students who have contemplated coming to this country and who otherwise would have come will now be looking elsewhere for somewhere cheaper, and institutions such as the Manchester Institute of Science and Technology, the London School of Hygiene and Tropical Medicine, the School of Oriental and African Studies, the Courtauld Institute and so on—institutions which depend for a substantial part of their income on the presence of foreign students—will be in grave difficulties.

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And these difficulties in certain cases—and this is very near home so far as I am concerned—will not be diminished by the cuts in subsidies to domestic graduates such as must be involved by cuts in the amounts allocated to scholarships by the Social Science Research Council, not to mention possible cuts in awards by the British Council.
These difficulties are not imaginary. I conjecture that all institutions of university calibre whose finances depend to more than a moderate extent on the recruitment of students abroad will face deficits which, on any reasonable conjecture of present policies of future intake, deserve the description of being truly alarming—and that statement takes account of the trifling provision for an allocation for students of quite exceptional ability. Do we really want, in the interests of prudent economy—and prudent economy is certainly incumbent on us—to throw such a disproportionate burden on just those institutions which contribute most to our present international reputation?
I must not go on, but I must say that at the end of a working life spent in institutions of this sort I would say this in all seriousness: if the present Secretary of State had deliberately set himself to create maximum embarassment to the main centres of excellence in higher education, and even to the destruction of some of them, he could not have done better.
11 p.m.
Lord GORE-BOOTH: My Lords, in accordance with the precedent set by certain other noble colleagues, I should perhaps declare that I have been for five years the unpaid chairman of the governing body of the School of Oriental and African Studies and that therefore, to that extent, I have some interest in this subject. None the less, I have tried to keep my thoughts very short and as impartial as I can when considering the present situation.
The first reaction that we have had—and I am now speaking from the public relations point of view—from a Press organ has been, "London college to close down ". I think that if any member of the Government feels any grievance about the reaction to what has happened, that
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must support the argument of so many noble Lords, with which I fully concur, that there was room for more consultation and more and deeper thought about this matter. However, equally, I attach importance to expressing agreement with my noble friend Lord Annan, because one cannot conduct this matter on the basis that everybody else must save, but not me. That is not permissible. Therefore, from my personal point of view—and I speak under no instructions—clearly there must be some sacrifice somewhere by everybody if we are to be justified in putting up the strongest arguments we can for our own particular occupation.
If your Lordships will forgive me, coming from the stable that I do, I propose to make one or two remarks about the School of Oriental and African Studies, which may show a little more of what actually happens and what causes what happens. I was grateful to the noble Lord, Lord Annan, for his kind remarks about SOAS. If the institution of SOAS were to go under as a result of this policy—I am sure that we shall fight not to go under, because we happen to think that we do a good job in an important realm of external policy—I think that it is only right to remind your Lordships of a little of what would be lost.
In this Government-created and promoted college—and I realise that Governments can change their minds—we make an effort, as one noble Lord said (I think that it was the noble Lord, Lord Robbins, but I may be wrong) to harmonise activity and diligence in the common interest of institutions and individuals from foreign or Commonwealth countries and ourselves. That can only be a plus in the most literal financial or, equal in importance, intellectual circles. It cannot but be a plus to set against the minus. This has been demonstrated in all sorts of extraordinary ways, of which I shall mention just one example.
When the problem of our relations with Asian countries was beginning to extend, a special effort was made to introduce and foster the growth of the knowledge and trade, and so on, with the Japanese through the language techniques employed by SOAS. This was inevitably profitable because, as my noble friend has said, it encouraged our own occupation and our own understanding of the Japanese, and so

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it works. During the Second World War it worked simply because we had an extraordinarily good ability to understand what was going on in Japan, which we would never have had had we not made the acquisition of knowledge of Japanese attractive through having SOAS. I am not suggesting that all the advantages are available in wartime and not otherwise. By making study in SOAS attractive, this kind of cross-fertilisation brings results both in ways that are expected and in ways that are unexpected.
So we have what a friend of mine has described as a permanent resource or a permanent asset—some may call it a permanent weapon. If we make this facility less and less attractive—and I agree in the main with those noble Lords who believe that the amount that we shall be taking away will do this—then we are simply throwing away, not an asset directly in cash, but an asset of a deep and unexpected value which one easily overlooks, and at one's peril.
So when we looked at the paper yesterday and saw the headline "London college closing ", that did not wholly, over-melodramatically, express the situation, though my colleagues are tough and talented people. We do not want that to happen and we should hate it if it did, and certainly if it did for a wrong cause. As my noble friend Lord Annan said, at this point it is important for anybody speaking from any of these institutions to be honest about the situation and admit that in the present situation any Government are bound to want to economise and are bound to try to be fair in the economies that they make.
Therefore, it would be wrong to offer a kind of blank or total objection to every kind of economy that was presented. That would not be playing the game fairly. At the same time what has happened—and I am sure it was not the intention of the Secretary of State—has fostered a feeling of hostility towards the educational world; even an amateur must appreciate this. One way in which some of the edge could be taken off this situation—though, again, this is not an original idea; it was also presented by another noble Lord, if not more than one—is if it could only have happened in the way it should have happened. In seeking to achieve an economy, a number of people
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should have been consulted—I shall not say that they should have been taken into the Government's confidence because that would hardly be possible—including many of the notable Members of your Lordships' House and others, on the best way to achieve this, if it could be achieved, and on how to select people most fairly. That point has, in fact, been dealt with; they do not seem to have been selected at all. I think it will be found that in the part of the academic world in which I am involved that would certainly have been understood. The missile that has been thrown at the academic world in this way takes away the reasonableness of people who would like to help the Government in this situation. They naturally react in the opposite way when this is thrown at them.
I can say with a certain confidence—if your Lordships will excuse me for just a moment in a little bit of propaganda for our institution—that this institution is one which has by far the greatest international prestige compared with its rivals. There is practically no competition in this country at all. Your Lordships will not be surprised to know that the only competition comes from the Soviet Union. The Soviet Union very rarely does something that is not greatly to its advantage, so perhaps we might be humble enough to pay serious attention to this curious fact. If we have an organisation like this—and I know that others have similar merits, notably from the speech of my noble friend Lord Garner—do let us have a more reasoned examination of it. This is not a plea for delay for the sake of delay. It would be more sensible, in trying to add up to some extent the relative merits and importance of the various institutions, and also seeking ways—as many other noble Lords have said—to avoid the tremendous bump in the fees payable.
A great deal more could be said. I do not feel qualified to say it, but I did feel that as I felt strongly about this matter it was necessary to say something. I can assure your Lordships that if something can be done, the effect on morale will be great. If nothing is done, there will be a deep disappointment, and adverse effects, even if not to a tremendous degree, will quite undoubtedly follow.
Finally, I should like to express my gratitude to my old boss the noble Lord, Lord Stewart of Fulham, for raising this

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matter, which he did with his great authority and his great humanity. We are all extremely grateful to him for having raised it. I end with the hope that the Government, having launched this proposal in this way, will have another look at it and its effects and see whether they cannot improve on what they have said they will do at this particular time.
11.13 p.m.
Lord VAIZEY: My Lords, I should like to echo what the noble Lord, Lord Gore-Booth, has just said in thanking the noble Lord, Lord Stewart of Fulham, for introducing this Question. I should also like to echo what my noble friend Lord Amory said in welcoming back the noble Lord, Lord Boyle of Handsworth, after his serious illness. This debate is of great importance, as many noble Lords have already said, because it concerns our country's relations with opinion-formers in many countries. It also concerns the security and the condition, the health, of our higher education system, especially the universities. These are both matters of profound importance.
It is clear that the policy of differential charges for overseas students is not in itself a matter of dispute between the two main parties in this Chamber. The differential was introduced by Tony Crosland; it was then maintained by the present Prime Minister. It was increased by Fred Mulley, and in fact increased three times by Shirley Williams. Now the proposal is that it be increased again by the present Secretary of State.
During these years of differential fee increases the number of overseas students has undoubtedly increased, and—a point which has not been made so far—it has increased outside the public sector, in many institutions which, because they are private, charge the full economic fee, so there are many thousands of foreign students in this country already paying full economic fees.
There is opposition in principle to the policy of differential fees but, as I understand it, the present issue is whether the level of increase is now so great that the number of foreign students in the public sector will decline and—and I gather that is the point of Lord Stewart's Question—will decline, be it noted, in the public
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sector, including the universities, and not in the private sector. That is a question of fact and the indications are that the new level of fees is already discouraging foreign students, especially those in the postgraduate institutions where the maintenance of an international body of students is vital to the high levels of achievement to which we are accustomed, and I shall return to this important point on which several noble Lords have already dwelt.
There is another issue which must be raised at this stage. The manner of the new fee increase has added enormously to the difficulty of planning the efficient use of resources in higher education and in the universities in particular. Admissions for October 1980 are already well under way; we have little idea how much we have to spend and, in the case of overseas students, the uncertainty is almost complete. Several major institutions—the Manchester Institute of Science and Technology and the London School of Economics—undoubtedly face very severe financial difficulty, perhaps even going so far as bankruptcy, if this policy is maintained.
Candidly, I try to be as sympathetic as I can to Ministers and officials and I have been trying to imagine the discussions taking place in committees which must have advised my right honourable friend to take this bizarre course. The only reason I wish to live to be 80 years of age is so that I can go to the Public Record Office at Kew in 2009 and read the minutes of these extraordinary committees.
Viscount AMORY: My Lords, may I inform my noble friend that there are other good reasons for wishing to live to be 80, which, with luck, I shall do if I can hold on for another five days?
Lord VAIZEY: If I can follow my noble friend's example in every respect I shall be delighted, my Lords. I am not necessarily opposing the principle of differential fees, although it would be idle to pretend that it has not caused strong feelings of ill will to successive Governments; it has not added to the popularity of one Minister of Education over the last 12 years. Nor am I opposed to reductions in public expenditure. I welcome them in general and often in particular. Realistically, we know, as the

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noble Lord, Lord Annan said, that the size of the relevant age group will decline from the mid-1980s onwards and it would be unreasonable not to expect reductions to be made in the provision for higher education.
I must however suggest to my long-suffering noble friend on the Front Bench that what is now happening is causing damage to the Government's reputation and damage to the stability and efficiency of the universities and the rest of the higher education sector. Moreover, it would be my respectful submission that substantial economies are attainable and that they should be pursued rather than this will o' the wisp. First of all, if some indication could be given of actual realistic levels of expenditure over the next five years, realistic plans could be made. The universities have shown themselves to be prudent, well run and highly responsive to public needs; they responded to demobilisation in 1945 with two-year degree courses, they responded to the need for more scientists and engineers and the need for more places following the Robbins Report. However, what they need to follow public policy is firm guidance, but all the University Grants Committee is doing at the moment is uttering feeble and, let it be said, semi-literate bleeps. I disagree here with Lord Annan; I do riot think it is the universities' fault. If there is selfishness within the universities, it is because clear guidance has not been given for several years.
Next, when Mr. Crosland introduced the differential fee system, he also introduced the binary system. The duplication of courses, of staffs, of buildings in higher education was bound to be expensive and inefficient, and so it has indeed proved. There are 17 physics departments in Greater London alone, and 90 in the country as a whole, many of them with vacant places. My noble friend, given the will and given a sensible body to overlook higher education, could save millions of pounds in the exact sciences alone over a period of years by careful planning of these scarce resources.
If we add to this other issues, many of which have been raised by my noble friend Lord Annan frequently in the past in this House and elsewhere—more students living at home, a re-examination of Student Union finances; a whole series of
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questions—I would submit to your Lordships that genuine savings could be made, and not the paper savings to which the noble Lord, Lord Stewart of Fulham, so appropriately referred. But they require co-operation between institutions on both sides of the binary line. This co-operation does not take place at the moment because there is no financial inducement to any institution to undertake it, due to the fact that any money that is saved is grabbed back.
I would submit that overseas students are an easy target, and probably an unworthy one. Moreover, by the extreme uncertainty, and by the method of reduction, the costs of educating British students will actually rise. We shall keep our staffs, and we shall educate fewer students. The effects of the policy are capricious. However much the London School of Economics may be detested because of its socialist past—a fictitious past, as the presence of my noble friend Lord Robbins shows here—the Government can hardly be said to have wished to drive it to bankruptcy in 1982. If a college were to be closed, there would presumably be other candidates.
I support the need to cut expenditure. I have suggested in my speech that expenditure can be saved on a fairly large scale, and I regret that my right honourable friend has been advised to take his present course, rather than to go directly to the profoundly necessary task of planning the higher education system in such a way that its morale is maintained while public money is saved. I deeply regret that the present Secretary of State may very well fall into extremely bad repute generally, and be regarded as a thoroughly bad Minister because of this one, single ill-advised decision.
11.22 p.m.
Lord HATCH of LUSBY: My Lords, I, too, should like to thank my noble friend Lord Stewart of Fulham for raising this issue. I only wish that it had been possible to combine this debate with the debate that we had last night on immigration, because I believe that the views that have been expressed about the value of a mixture of cultures and of individuals from different cultures would have been particularly appropriate in view of some of the speeches we heard during yesterday's debate. It has been clearly proven by the

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noble Lords who at present are administering our institutions of higher learning in this country, or who have done so in the past, that the effect of the proposed plans of the Government will be to reduce the number of overseas students in this country. I hope that as my noble friend Lord Stewart is asking this Question, the noble Baroness who is to reply will answer the specific question as to whether her plans for expenditure on the fees of overseas students next year will in fact in her estimation reduce the number of overseas students.
I say this because what so far has been missing from the debate is consideration of the effect on British students of the absence, or reduction, of overseas students. I recall nearly 30 years ago taking a seminar in the University of Edinburgh, where there were a number of African students. One of those African students I particularly remember, because he is now President of Tanzania. His name, of course, is Julius Nyerere. If the increase in fees for overseas students which is now proposed had been in effect at that time, President Nyerere would not have been educated in this country. I would consider that to be, not so much a loss for President Nyerere as a loss for the hundreds of students at Edinburgh University and other universities visited by him during his student days in this country, who remember him today and who have been affected by him.
I would suggest that one of the most important aspects of the Government's policy towards overseas students should be the imagination to recognise the needs of British students—British students who are going to live for the rest of this century and for well into next century in a totally different world from that in which we were brought up; a world which is not a village but a world which has become a hamlet. The knowledge that our students have of overseas cultures (which, as the right reverend Prelate the Bishop of Bradford so movingly pointed out yesterday, can be learned only in the personal contact situation) is what we risk losing if the noble Baroness admits the argument, which has been almost totally universal tonight, that the effect of her Government's policy will be to reduce, and drastically, the number of overseas students coming to this country.
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There is one other point I should like to put to the noble Baroness, on a practical basis. I have done this before, and I still do not understand the logic of this Government's policies. It is surely proven that the education of overseas students in this country is of business advantage to the business world of Britain—and we are a trading nation. As one previous speaker (I think it was the noble Lord, Lord Gladwyn) pointed out, some of the largest and widest internationally-trading companies in this country are very concerned about the danger of losing the contacts which they make through the education of overseas students here, who go back to their own countries with a knowledge of the culture of this country and who naturally turn to this country in their position in either politics or the business and economic world. Surely the noble Baroness must recognise that, if this Government believe in their own policy of reviving the trading power of Britain, then this is in fact burying the seed corn which they themselves would rely on to extend our trading opportunities in the future.
However, what I want to concentrate on in the last few minutes of what I have to say tonight is how this can be done. How can we provide our own people—our own young people, above all—with this multi-cultural understanding which is essential for their peaceful life during the next half-century? How, at the same time, can we provide the links on which our business and economic health depend? And how can we move out of this negative attitude of the Government and have sufficient confidence in our own British culture to say—not, chauvinistically, "This is the best culture in the world "—" We have got something to contribute to the growing concept of a world culture, a culture of many components, one of which must be seen to be that of Britain "?
I believe that contained within the noble Lord's Unstarred Question is one of the most important answers to this question; that is, the role of the British Council. The British Council have unashamedly taken British culture in its widest sense: the practice of British institutions, the language of the British people, the practices, experiences and customs which have grown up in our own multi-cultural Britain; and taken them all over the world. Those who travel in many parts of the world know of the work that they have been

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doing. But they have been doing more; and more specifically related to what I have been already saying. They are bringing, out of their own funds, overseas students to this country. They are administering the work of supervising, looking after and encouraging overseas students in this country. They are acting as agents of the Overseas Development Administration in the arrangements made for technical co-operation with students in this country. They have the Students' Centre in London and have offices all over the country.
I should like to ask this of the noble Baroness: Does she believe in the work of the British Council? Does she believe in the functions that the British Council have been set up to achieve? Does she agree with the repudiation of the Bell Report, as far as its condemnation or criticism of the British Council was concerned? If the answer to these questions is in the affirmative, then what hope can she give to the British Council, what prospects can she give to the British Council?—because she must know (and I am sure that she will agree with me on this) that an organisation like the British Council must be able to plan ahead. There is no use in talking about one year's cuts as though they were once and for all. The effect is exponential and the effect on the British Council will be exponential.
They have already worked out that if the present cuts (which they understand are to take place) are put into operation, this may well—dependent upon the size of the students' fees—cut in half the number of overseas students they can bring into this country. It may well run down the work of the Students' Centre until it has to be abolished. And it may well bring to an end the work that the British Council have been doing in helping British students to get experience in overseas countries, to place them in overseas institutions and to give them the experience that they will thereby get.
I ask the noble Baroness when she comes to reply to address herself to this issue and to tell this House, and through this House, the British Council, what are the Government plans, visions and objectives as far as the part that the British Council can play in the development of our multi-cultural student population in this country and abroad. Do the
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Government believe in the British Council? If they still believe in them, how are they going to sustain them without so fatally damaging them by making cuts which are bound to have an effect not just this year, or next year, but in three, five and seven years hence?
11.35 p.m.
Viscount CRAIGAVON: My Lords, I shall be very brief at this hour, and confine myself to just one point; that is, the long-term effects of the Government actions. I broadly agree with the robust realism of the noble Lord, Lord Annan. I have been advocating quotas for many years. I fear the academic world has hardly seen the beginning of the real cuts. At the same time, I feel that the noble Baroness owes rational and coherent explanations of the Government's position to many of the powerful speakers that we have heard.
I know that the Conservative Party have always placed considerable importance on their foreign policy. It is very easy for us in this country, and the media, to fool ourselves about our importance in the world, especially as we all use the lingua franca of English. I accept that our international influence has been declining; but surely the one way and the cheapest way that we can have an international voice in the future is by casting a little educational bread upon the waters at this time while we still have valuable things to teach. What I am afraid is happening is that decisions on this matter are being taken by default.
As a younger Member of your Lordships' House, if I were able to look back at the present time from 25 years' hence, and if I found that our international influence was significantly diminished, it would not be due to positive decisions; it would be from a slow process of neglect and expediency, of which the British people would have claimed to have been hardly conscious.
I would add my appeal to the Government both for the benefit of ourselves in this country and for those we can help abroad through education, to take a much longer-term view of our traditional foreign education links. Some noble Lords may have read about the remarks of Dr. Rhodes Boyson in another place,

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when he said that the behaviour of Iran and Nigeria (two of the top three in numbers for sending us students) were not the best examples of the claimed benefits of educating their students, but in terms of spending money on foreign matters, we could have invested in aircraft carriers and a fleet like the Americans. But they would have been of no more use in resolving those delicate situations than is the American Sixth Fleet. It is more hopeful for me in those situations that a mass of Nigerians and Iranians have in the past been educated both here and in America.
It is on that basis, that we have shared part of our culture and ways of thinking with them, that the situation will be resolved; not the fact that we can send in the Fleet. I hope that the noble Baroness, Lady Young, can channel the traditional and laudable concern of the Conservative Party about foreign policy away from guns and slightly more towards hearts and minds.
11.38 p.m.
Baroness VICKERS: My Lords, I am delighted to have the pleasure of speaking in this debate but I am not as qualified as many other noble Lords to do so. I should like to say to the noble Lord, Lord Gladwyn, that I was rather surprised at the tone of his speech, because he seemed to prophesy what the noble Baroness is going to say. She is a very capable Minister and I think it is very dangerous to prophesy what somebody is going to say. I was wondering whether, when the noble Lord asked his charming wife to marry him, he prophesied what the answer would be. This seemed the kind of thing that he was saying.
There is a very good English language regional school in Singapore. The noble Lord may be pleased to know that the ASEAN countries are always turning to this college, and it is a college for what teachers learn English and our methods. The Filipinos and Thais particularly appreciate it. I should like to point out—I am afraid the noble Lord is not here—that the polytechnics get their grants from local authorities and not direct from the Government. I should like to suggest to the noble Lord, Lord Gore-Booth, that he might tackle the Japanese to reinstate
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the position. They have plenty of money, and I do not think that learning Japanese did us much good in the last war.
Lord GORE-BOOTH: My Lords, may I just interrupt for a moment? Possibly I did not make it quite clear, in my laudable effort to make my speech as short as possible, that a lot of the profit in having the Japanese here as our students and guests is that we learn a great deal about them, and that was very useful during a certain emergency in our history.
Baroness VICKERS: My Lords, having served overseas and having been in Indonesia, I did not think that the Japanese had learned very much from us at that time. I should like to quote from something Mrs. Shirley Williams said on 19th December 1978: I shall not quote all of it:
" So we face a twin problem:—increasing pressure on our resources, coupled with the indiscriminate nature of the tuition fee subsidy ".
She went on:
" It is well known, certainly to this audience, that I want to see a more rational system. I want to see £100 million tuition fees used positively to help selected groups of overseas students, in place of the present indiscriminate system—if "system" is the right word to apply to the present practice ".
I want to make a suggestion which may not be very popular, but perhaps we could work out some system. I have been through the details, but I shall not give all of them. I will only give the very low and the highest of the incomes per capita of many of the students. For example, in Bangladesh they only have 265 dollars per capita; Egypt has 200 to 499; Algeria has 500 to 536; Greece has 2,000 to 4,999; and Australia has over 5,000. I cannot see any reason why we should not bring in a sliding scale—not a means test. If they came as private pupils, they would pay the fee demanded by the institution concerned. Therefore I do not see that it can be any more of a means test than paying out of your own pocket for private education and having a sliding scale, so that the poorer countries get more help from the Government.
When I was in Malaya I had the opportunity of selecting and recommending students to come to Britain and study social science. I found it very beneficial to them. The pupils were all tied to serve for so many years on their

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return the establishment which sponsored them if they received a Government grant. I think it was very beneficial to the students to get outside their own country and see how others lived.
I should like also to stress that I tried to select some of the very poorest people who had average intellect. We trained them for a little while in the office in the country concerned—in Malaysia—and then sent them home, because one was apt to get very highly educated people who could not come down to the level of the people in the villages. These people, having started in the villages with their training, gave very useful service to the State.
The noble Earl, Lord Listowel, mentioned some of the countries which were interested and which had put forward ideas in regard to the future—countries that are—shall we say?—rather dismayed about the future: the Gulf States, Pakistan, the West Indies, Brazil, Hong Kong, Singapore, Thailand, even Korea, Chile and Indonesia. I was at a lunch yesterday with the Deputy High Commissioner for India, and I asked him about this problem. He said that although they realised the difficulties here, they hoped to continue. He said that what they really hoped was that people would go back to their country, because they did need highly educated people back in India again. Education increases understanding, so we must give priority to Commonwealth countries.
I have been a member of the Commonwealth Parliamentary Association for 19 years, and it is a very beneficial organisation. When we have our annual conference, we all speak the same language and practically all have the same educational background. Therefore, there are better working committees and there is much better understanding. Education is very powerful in creating understanding. I should like to ask: Do we want to keep the Commonwealth? I ask that because it is language and education which keep the Commonwealth together. That is one of the reasons why I should like to make a plea that we look after the Commonwealth first.
Various Governments have been very generous over the years, because there have been 17 political upsets in different
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countries when students have been here. We all remember Biafra, and now we have people from Iran here. What have we done? We have paid for them from funds or from social security until they could manage, so we have been very generous. They have never been sent back, which is a very good mark for this country.
If students go to the United States of America, they will get a fairly good education more cheaply, but it is of a different type. That is what worries me, because when they go back to their own countries they will have different ideas from their parents and grandparents, who were educated in the British system. That is another reason why I prefer them to come here. Sir Roy Marshall, who is the Commonwealth Educational Liaison Unit chairman, called a meeting and said that he was going to consult the High Commissioners about the future of their students. It will be very interesting when we get the report, to read what they have to say.
I should like to mention Reading University, because I have a lot to do with it. The full economic cost is £2,000 for arts, £3,000 for sciences and £5,000 for medicine for all new students—and I emphasise "new students ". The cut by the Government for this university is 15·6 per cent., which is making the assumption that the shortfall will be made up by the university charging the full cost of fees. Unfortunately, this will not work, because the number of students never remains constant. Education in this country is among the most expensive in the world. I have been looking at the accounts for various universities in America. Stanford is approximately £2,600, Carnegie-Mellon is £2,000, Berkeley is £1,500 and the State University of California is £950.
We have quite a number of people who are here on scholarships and I should like to refer to this aspect because it is very important and we must not forget what we have done in this direction. Of sponsored students we have 1,334 United Nations Fellowships, 24 Council of Europe, 33 OECD, 7,497 British Study Fellowships, 572 overseas representatives, 61 British Council Fellowships and Euro-scholars, 89 Confederation of British Industry, 65 Marshall scholars, 193 Rhodes

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scholars and 9,227 British Council. So that we have a good number who will be sponsored in the future.
Reading University is one that I particularly like to mention, because it has advanced engineering, agriculture and rural development. That is why it is very important for students. Of the total student population, 13 per cent. is from overseas and they are largely British Council sponsored. I should like one Minister to be in charge of the development of policy; it leads to difficulties when several Ministers are involved. I should like the Minister to consider the development of a positive policy on overseas students, in collaboration with academic, professional and voluntary representatives of teaching in the institutions and local education authorities. I should also like my noble friend to tell me whether those overseas students who come here with their wives, and whose wives work to help keep themselves while their husbands are studying, will still be allowed to bring their wives.
Perhaps I should point out that the only private university, in Buckingham, charges £2,500 for a degree course. May I also point out that while there has been an increase in the number of students, there has also been a considerable increase in the number of countries sending those students, which makes a great deal of difference. We should therefore be proud of the expertise of those, many of whom we have heard in today's debate, who have spent so much of their time upon trying to improve the lives of young people by giving them the benefit of their knowledge.
I am president of the International Friendship League which runs hostels for students. Those hostels are not subsidised; they are self-supporting. Therefore I mix quite a lot with students. I should be very grateful, therefore, if my noble friend could answer those two points. I think that we have to give her all the support we can in the difficult days which lie ahead of her. I hope we shall see the benefits of the new policy and that next year we shall have another debate, when we will be able to see how things are working out.
11.52 p.m.
Lord BOYLE of HANDSWORTH: My Lords, I am very grateful to the noble Viscount, Lord Amory, and to the noble Lord, Lord Vaizey, for their kind personal references to me. The hour is very late, but I feel it would be wrong for this debate to end without one contribution from a representative of the large civic universities of the North of England.
I think the essential point was made at the very start of this debate by the noble Lord, Lord Stewart of Fulham, when he said, with the typical precision which I got to know so well in the House of Commons over many years, that tonight we are discussing a quite different order of proposal from any we have discussed in earlier debates on the subject. The House should remember that absolutely crucial point.
1 have never taken a dogmatic view over differential fees—nor, indeed, have the senate or council of my own university. At recent senate meetings, professors of applied science who are in close touch with industry have gone out of their way to remind their colleagues that it is not only the universities which at present face acute difficulties and that we should always remember the particular problems of manufacturing industry, which is now having to face the consequences of a minimum lending rate of 17 per cent. But when one has said all that, there would equally be unanimous agreement within my university that, in the words of the noble Viscount, Lord Amory, the present proposals of Her Majesty's Government are much too harsh.
When I say "unanimous agreement" I do not mean only unanimous agreement among academics and unanimous agreement among students. One ought to remember that these same views would be very widely endorsed by university councils and university courts representing lay people—indeed, with majorities of lay people. My own university council at Leeds at its first meeting this term unanimously endorsed the statement of Sir Alec Merrison to which the noble Lord, Lord Wedderburn, referred in his speech earlier in the debate. When I made my annual court statement on 22nd November and answered questions for 40 minutes I was quite struck by the unanimity of feeling in court: that while

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everyone recognises the Government's difficulties and the nation's difficulties, none the less these particular proposals go a great deal too far.
Now, my Lords, why is this view so widely felt? The reasons have been given tonight, and I will repeat them very briefly in their simplest terms. First, there is the wide recognition that without the contribution of overseas students British universities would be quite different institutions, of much less value. The University of Leeds does not have a particularly high percentage of overseas students. Incidentally, our peak was reached as a percentage I think in 1975 or 1976. None the less this is as deeply felt at Leeds as anywhere else, and something else is deeply felt: we are not a regional university, we are something more indeed than just a national university. We are a part of what the noble Lord, Lord Robbins, at one point in the report referred to, I think, as the international confraternity of universities. By that I do not mean only, or perhaps even mainly, arcane contributions to learning. I mean the part that universities like Leeds and Manchester and Liverpool and Birmingham play in validating international standards of professional performance that are held right across continental boundaries, and indeed right across ideological boundaries.
Secondly, I would make the point that fully one-quarter of overseas students are here to do research, and they play a vital part in the intellectual and scientific life of the nation and therefore in helping to keep academic disciplines alive. Thirdly—and this point was made most effectively just now by the noble Viscount, Lord Craigavon in his speech—all over the world there are men and women, often in positions of influence, who have a real understanding of the United Kingdom because they spent some of their formative years of their lives being educated in this country.
It is very easy for many of us here to state personal examples. I remember the one time that I met Tom Mboya on a visit to Kenya. There was absolutely no doubt that his time at Ruskin College was a formative influence on the rest of his life, and I well remember the conversation that we had. Over and above all these arguments of principle there is the final point about money. The Government's
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policy means making a double cut in university resources on an irrational basis, on a basis that makes rational planning for the future impossible.
I have only one other point to make, very briefly. It is natural tonight that we think of the Third World and also, as we certainly should, of the EEC, but I hope we shall never forget the British university links within the English-speaking world. It is an important fact about the University of Oxford that some 50 per cent. of all overseas students come from the United States—with something like 33 per cent.—or from Canada or from Australia. And as the noble Lord, Lord Robbins, so rightly reminded us, believe it or not, by no means all American students are wealthy. There is the most extraordinary misunderstanding about this. Many of the most valuable and worth while students from the United States coming to this country are not in fact wealthy students.
I would venture to make this one point to my noble friend Lord Annan. He rightly referred to the quality of so many engineering students from Malaysia or from Hong Kong. He said that he believed they would continue to be supported by their families. I must say it is my own experience that quite a number of the ablest students, for example from Hong Kong, do get family support but it is, frankly, precarious support. At any time—and I think of a number of particular cases—such students may have to earn money themselves and become more self-supporting students in this country in order to carry them through their courses. I am afraid that it will be some of the ablest students that we might otherwise have attracted to this country who will now be very much affected by the differential in fees between the United Kingdom and other parts of the English-speaking world; and I think that will be very sad indeed. None of us should be in any doubt about the effect of the size of this differential, and of course it will not affect only those who are just about to come to university. The news of the change in policy is getting around to those who are at an earlier stage of their education in those countries.
I am sure the noble Baroness, Lady Young, cannot have been looking forward to this debate. She must feel a little

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like the wife of Joseph Chamberlain on the eve of his 70th birthday after the cavalcade round the Birmingham park, when she said she felt beaten all over with little sticks. I certainly would not wish the noble Baroness or her right honourable friend the Secretary of State, or even the Parliamentary Under-Secretary, the fate that overcame Joseph Chamberlain the following Wednesday. Nevertheless, I would say to her that I do believe the Government's policy may have far more severe effects both on numbers and on university finances than Ministers have any idea of.
I have an uneasy feeling Ministers have by now made up their minds quite definitely about policy for 1980–81. I would echo Lord Annan and beg the Government to stand prepared to review this policy for 1981–82 and for the following years. I do believe this is one of those issues where, if the Government were to show themselves more flexible, ready to review policy in the light of experience, that would stand only to the credit of the Government in the years to come.
12.1 a.m.
Baroness DAVID: My Lords, I, too, am very grateful to my noble friend Lord Stewart for introducing this debate. It seems very suitable that someone who has been both Foreign Secretary and Secretary of State for Education should have introduced this subject. The dramatis personae tonight are very much the same as we had on 5th July, though it is good this time to have some new actors and new voices. I am afraid the traffic of our stage is going to last considerably over two hours. The situation now is very different from that in July when the noble Lord, Lord Alport, asked what the Government's policy was with regard to the admission of overseas students to British universities. There was then considerable anxiety expressed at the increase of 3½ per cent. in fees for 1979–80. That now seems chickenfeed. What we are facing are increases for 1980–81 of 113 to 219 per cent. in universities, depending on whether the course is an arts or science one, and even higher increases of 155 to 251 per cent. for those in advanced education in the maintained sector. I should like to hear from the Minister the reason for the new differential
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between the universities and the maintained sector fees. I should have thought that many courses in polytechnics and colleges of higher education were particularly relevant for overseas students—textile courses, for instance. We have, unfortunately, no one in this House to speak for the State sector, but we should not ignore that sector in this debate.
Increases announced last month have provoked protest from academics, administrators and students which in unanimity of tone is unprecedented, and this is why it is vital to have the matter debated now, in the hope that the Government might, as with the BBC External Services, and for very similar reasons, have a change of heart. The last Government was not popular for making a differential and increasing fees for overseas students, but they were at least gradually reducing that differential. The present Government policy—and one wonders whether it has really been thought out; I do not believe it has—is quite different both in the scale of increases proposed and in the sense that these increases are being used as a direct instrument to impose public expenditure cuts on the universities, and it is a very blunt instrument.
The noble Lord, Lord Annan, said that the need for public expenditure cuts had not been mentioned, but I think that is unfair. My noble friend Lord Wedderburn said that there may well have to be cuts but they should be planned cuts, and Lord Vaizey made exactly the same point. I think that probably we all realise that there should be some cuts, but this hatchet job is not the way to do it. I think that one can compare this blunt instrument attack with the plan in the new Education Bill, to cap the pool—and again that is a very poor instrument.
For the universities, planning, with all the uncertainty about how many overseas students will be taking up places by 1983–84 when all the overseas students will be paying the full fee, combined with very many other uncertainties, would be incredibly difficult. What the Government are proposing to do is to reduce the grants to universities by 13 per cent., assuming that the shortfall will be made up by overseas students paying full fees. But that 13 per cent. represents £107 million; and can it really be certain that

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sufficient overseas students will be willing to pay more than double the present fees? Indeed, £107 million is a very large sum to be uncertain about and, as noble Lords have pointed out, London has a far higher percentage of foreign students, and is therefore all the more vulnerable.
The Government have previously held that increased fees did not deter students from applying. But increases of this magnitude are certain to deter them. In fact, in the UCCA's recent Press release, the number of application forms received by 15th November from overseas students, compared with those of exactly one year ago, were down by 11 per cent. Just under half the expected total number have so far applied. Therefore, trends must be looked on as provisional. But in recent years overseas candidates have tended to apply more promptly than their United Kingdom counterparts, and if the tendency continues this year, that figure of 11 per cent. is likely to be an underestimate. My noble friend Lord Wedderburn of Charlton referred to the numbers which Dr. Rhodes Boyson gave in a Written Answer in another place on 22nd November. That certainly seems to show that fees have had an effect.
I had planned to say a certain amount about the costing, but that really has been dealt with by other speakers. Therefore, shall just confine myself to saying that I do not think that the method of costing—full cost and average cost—is a fair one and that marginal costs are a better way of going about this.
The Committee of Vice-Chancellors and Principals' Joint Working Party on Tuition Fees estimated that the short-term marginal cost was about half the average unit cost; and the long-term marginal cost about two-thirds. The Council of the Association of Principals of Colleges—that is, the equivalent in the maintained sector of the CVCP—in a paper for their Council, agreed that those estimates may be true of universities; but they considered that in their sector, if all full-time overseas students were taken into account, both the short-term and the long-term marginal costs would be substantially lower than these university-based estimates. They have written to the Secretary of State stating their thesis and they suggest that the facts could be discovered by the DES
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conducting a sample survey over the country in order to obtain actual marginal costs—short-term and long-term. Surely that would be a sensible and fair thing to do, and need not take a vast amount of time, before deciding finally on the astronomical rise that Ministers are suggesting.
The noble Lord, Lord Bullock, has also suggested an inquiry, as have several speakers this evening. I understand that no university in the world charges fees which are "average costs". Harvard Business School, one of the highest chargers, charges 60 per cent. Would the Government even now reconsider, and think of fixing fees on a basis that has been researched, and not put us totally out of line with the United States of America, Canada and other countries which otherwise may draw off students from this country with all the attendant benefits they bring? I am referring to benefits of trade, business, goodwill, and so on, which have been acknowledged by all parties in this House so I shall not take up the time of the House by enlarging on that theme now.
Another aspect that shocks is the arbitrary nature of the exercise. There has been no discrimination. A number of our academic institutions have been traditionally geared to educating large numbers of overseas students, particularly in London. Noble Lords have spoken powerfully of that, so there is no need for me to report what has been said. In Manchester UMIST will have to make up 35 per cent. of its income if it loses its overseas students. Surely some consideration should have been given to the very diverse nature of the institutions involved and their long traditions. One would have expected a Conservative Government to take heed and respect traditions such as these. I am very sorry that the health of my noble friend Lord Bowden prevents him being here tonight, for I am certain that we should have had him standing up and saying that wherever he went all over the globe he found engineers who had been trained at UMIST.
I should like now to turn to a different aspect of the subject—the distinction between postgraduates and undergraduates. My noble friend Lord Listowel and the noble Lords, Lord Robbins, Lord Vaizey, and others have spoken on this. The Government appear

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to have recognised that postgraduates might be a help to us; that the research they do and the teaching they undertake in the universities is a very valuable contribution. But to offer a mere £1 million to help support 400 to 500 students—about 2½ per cent. of postgraduates in universities last year, if my arithmetic is correct—is derisory. The selection of those to be benefited will, they say, be made by the Committee of Vice-Chancellors—a ludicrous idea. Obviously, the only way in which to distribute the meagre sum is to spread it around the universities, and it will be a very thin spread indeed.
If the Government are determined on change and cutbacks, surely it would be right to look on the situation of postgraduates and undergraduates as two quite different problems deserving different solutions. At postgraduate level overseas students should pay no more than home students. It is to postgraduate students that most aid money has gone in the past. It is in the post-degree courses and in research that we can make the greatest contribution to the international increase of knowledge, and in return receive help ourselves. Some universities would be very short of teaching staff if they did not make use of postgraduate research students.
Undergraduates from overseas can, I think, be looked at differently. A large percentage of them have in the past come of their own volition, unsupported by this or their own countries. Some, of course, have come as the result of the aid programme, and that should certainly continue as they will have been selected with care. But in many developing countries universities have been set up, often with our help, and it can be argued that first-degree courses should be supported there. If we make it too easy for their best pupils to come to England, we may draw off their cream and, therefore, lower their general standard. If certain courses are not available in those countries, or there are no suitable universities, that is a different matter.
But if the Government are determined to reduce the number of overseas students they should be far more discriminating. I suggest that it is positively harmful to international training and exchange of
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knowledge to treat postgraduates from overseas any differently from our own home-grown products. What about those of our own postgraduates who wish to study in foreign universities? We want to keep a two-way traffic going. Will the Minister be willing to raise again with her ministerial colleagues the special position of the postgraduate?
Next, I want to speak of the aid programmes organised by the ODA and the British Council. In her speech on 5th July this year (at columns 630–631 of the Official Report) the Minister said this—and I shall remind both her and the House:
" Many overseas students, for whom the United Kingdom Government take responsibility, come as part of the aid programme. I should like to confirm that their tuition fees will, as in the past, always be paid in full. It might be helpful if, at this point, I were to say a little more about them.
Our aim is to help developing countries to build up their own manpower resources, wherever possible through their own institutions. Where training in the United Kingdom is appropriate, we provide it mainly through our technical cooperation arrangements with individual countries, under which some 9,000 students are brought here every year on courses relevant to their country's development priorities. The selection of students and trainees is agreed between Her Majesty's Government and the overseas governments. A further 6,000 students are supported under other aid-funded schemes, including British Council scholarships, the British contribution to the Commonwealth Scholarship and Fellowship Plan, Inter-University Council arrangements and support for refugee students from certain countries … Under the Fee Support Scheme, introduced for the academic year 1977–78, up to 600 new awards have been available annually for selected privately supported post-graduate students from developing countries, on courses of developmental value, who are recommended by their colleges and who have suffered hardship as a result of fee increases of recent years.
Training for development is an essential function of the aid programme and in general we expect to continue to provide support for overseas students, subject to periodic review in relation to changing priorities and to the money available. Therefore, many of the poor students come in this way and will continue to have their fees paid in full ".
That speech gives a total of 16,100 students, besides others where precise numbers are not given.
I should like to know whether the noble Baroness stands by what she said in July both as to numbers and the Government's willingness to pay their fees in full. If fees are paid in full, will the number of students remain the same?

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I hear that Somalia, for instance, wishes to send veterinary science students and that the allocation of money for that country will not be increased. As those courses are very expensive, fewer students from that country will be able to come.
The British Council say that unless more money is received the number of new grants available from council funds will drop by half. The number of technical co-operation trainees arriving this year, expected to be 4,600, are down to about 4,000 because the Government gave instructions to suspend action pending decisions. These students are precisely those whose presence in the country will be most valuable, for they are chosen in consultation with the countries themselves, and are chosen as people likely to assume positions of responsibility in their own countries on their return. Their training is related to other overseas development assistance. So these are vital people in building up future relationships. What are the facts about the numbers and funding money for 1980–81?
I understand that the British Council has 543 students here this year funded by the council, and there are nearly 1,400 under the Commonwealth Fellowship Scheme. Then there is the Rhodesian training programme. Last year I believe there were about 1,300 Rhodesian African students being trained in the United Kingdom, and others elsewhere. The programme has been directed towards assisting the creation of a cadre of trained manpower to meet the needs of an independent Zimbabwe. Are all these programmes to continue, and at what level? The cuts in British Council funding would lead one to expect not, or at least that there will be a big reduction. I hope for a very full reply from the Minister on all grants and awards and numbers—whether paid for by the DES, the FCO (now embracing the ODM), or the British Council. And I hope we shall not be told that it is up to the FCO to say what they do—the question under debate was directed to Her Majesty's Government.
Not only is the British Council likely to be able to support actively far fewer students from overseas—maybe half—but the general information and welfare services it provides for young people when they arrive will have to be reduced
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too. The help given to foreign countries in advising on the choice of suitable candidates for education here will have to be abandoned unless those countries are prepared to pay for the service. The British Council is being emasculated. Are the Government planning a slow death for it? Are they following the advice of the Think Tank in its report on overseas representation? I understand that this House rejected that advice in a debate in November 1977, as the noble Lord, Lord Gladwyn, said.
Changing my tack, like my noble friend Lord Stewart I want to know what the Government's intentions are about fees for students from EEC countries. I put down a Question for Written Answer on this subject and had a reply on 13th November which, with respect, told me nothing I did not know before. In it the noble Baroness said that the Government were considering whether arrangements for overseas students might be modified to take account of the position of students from other member countries of the EEC. Now, four weeks later, have the Government made up their mind and, if so, what have they decided? It seems hard that Commonwealth students should be treated worse than Europeans. Is that still the intention?
The noble Baroness, Lady Vickers, made a powerful plea for Commonwealth students. One other class of students I have not mentioned already is refugees. We have behaved quite generously to Chileans, Ugandans, and others in the past. Is that to be continued? I read the other day that the noble Baroness had made some statement about the possibility of mandatory grants for the refugees from Vietnam; perhaps she could say something on that.
In the debate in July I acknowledged the difficulties and complexities of this whole subject, the immensity of the problems, administrative as well as moral, and I said:
" Any sudden change can have very dramatic effects. We "—
the last Government—
" had not succeeded in coming up with a set of proposals that satisfied us by the time Parliament was dissolved in April. It is over to the new Government now ".—[Official Report, 5/7/79. col. 624.]
Well, the new Government have taken action, precipitate action, I consider,

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with too little thought for reaction overseas or for reaction at home, unless they thought a reduction in overseas students would please certain people in the community, in which case I would call it an unpleasantly discriminatory policy.
I would ask the Government in all seriousness to pay attention to the great weight of protest, unanimous protest really, manifest in the House and in the country against what I must say are very foolish and shortsighted proposals. I ask them to consider the possibility of treating postgraduates differently from undergraduates and, if they must make increases in fees, to make them with greater sensitivity and caution, so that some of our great academic institutions will not think they are in danger of bankruptcy or closure in the next few years. The proposals they have made can only do harm to our own higher education system, to the educational standards we hear so much about from the Tory Party, and to our reputation and trade in many foreign and Commonwealth countries which have hitherto been our good friends and good trading partners.
12.22 a.m.
The MINISTER of STATE, DEPARTMENT of EDUCATION and SCIENCE (Baroness Young): My Lords, no one could listen to this debate tonight without recognising the real worry about the implications both at home and abroad of the Government's decision to increase fees for overseas students to full cost from September 1980. I am grateful for the clear and frank views that have been expressed on this subject and I recognise the strength of feeling it has aroused. I assure the noble Lord, Lord Gladwyn, that at any rate I am not in the least complacent about the subject, or particularly cheerful. It would be, after all, so much nicer to be in Government and have a lot of money to distribute to a lot of people, to be able to say to everybody precisely what they would like to hear, than to have to defend the difficult, complicated and hard decisions that we have had to take.
For my part, I should like to place on record that the Government are aware of the contribution that overseas students
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have made and continue to make to the intellectual and social life of our educational institutions. Nor have we left out of account the deserved reputation of our educational institutions as internationally renowned centres of learning. Quite apart from accepting students from other countries, our universities are in frequent contact with universities all over the world through visits by university staff and by exchanges of staff. There are also many links at the highest academic level and such valuable contacts will all continue.
If, however, we go back to 1970–71, when there were only 18,000 overseas students at our universities—about half the present total—I do not recall that anyone ever suggested that our universities were accepting too few students, that they could not be regarded as institutions of international reputation and repute or indeed institutions that were not influential in the world, and I was very interested in the rhetorical question which the noble Lord, Lord Annan, asked: what is the right number of overseas students to fulfil all these obligations with which I agree and the whole House agrees? Is it what it was in 1970, is it what it is today or is it the figure which the Government of the noble Baroness, Lady David, suggested and which would mean a drop of 21 per cent. in the current numbers of overseas students in our universities?
Well, who knows the answer to that question? But it is one to which I think we need to address our minds, because in asking it we all recognise that returned students often occupy positions of influence in their own countries and can be helpful in commercial and political relations with this country. There are many benefits which I recognise accrue to Britain, but I am sorry to have to say to the noble Lord, Lord Gladwyn, who I know will regret it, that it is difficult to quantify what these benefits are, and we have yet to see figures which will stand up to rigorous examination on how one quantifies precisely the benefits that the overseas students bring. The provision of higher education in this country is of course a valuable part in a number of cultural agreements with other countries.
At the start of my reply I should like to thank noble Lords, particularly the noble Lord, Lord Annan, and the noble

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Lords, Lord Robbins, Lord Gore-Booth, and Lord Vaizey, for their references to the difficulties of the economic situation which the Government face. We came to office last May committed to reducing the level of public spending, and none of the decisions that we have taken, in the educational world or indeed in other departments, has been taken lightly, and the one to introduce full cost fees for overseas students certainly was not so taken.
The fact is that we are in a world which is very different from that to which we have been used for a long time. I understand that each year the grant to the universities has increased, with the exception of the year 1977–78, when it dropped by 1 per cent. in real terms as against 1976–77. When we are in a situation of no growth in the economy we must look at the future costs of universities, of education. Everyone who has spoken about the economies has said, "Ah! but this is the one important thing that must be saved." If I were to make this kind of speech to an audience of teachers, or to a school, or to some other part of the educational system they, too, would argue that theirs was the one and most important part. The fact is that when one starts to make economies they are always painful and difficult, and no one particularly wants to have to make them.
We decided that we could not afford to go on subsidising overseas students in this country at a cost of some £100 million a year. The previous Administration sought to control the subsidy by means of a quota and by charging differential fees for overseas students, but in 1978–79 that policy did not in fact prove to be effective. Resources were allocated in that year through university grant and Rate Support Grant sufficient to provide for 72,000 overseas students. In the event, 87,000 students came—an excess of 15,000, who were accepted by institutions and paid for out of public funds intended for home students. We therefore believed that a different and more effective policy was necessary because, as some noble Lords have indicated, we started with a rather confused background, and we have in fact opted for full cost fees.
I have been told by many noble Lords that we have used a blunt instrument, but
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in fact the full fees will apply only to those coming to the universities in the next academic year, and those students who are currently on courses will not pay the full fees. Of course it would have been far more pleasant to have stood here and been able to say that we could afford to continue to pay for all the subsidies on the overseas students, but the country's economic position does not allow us to do so. Public expenditure has had to be reduced, and I think it only fair that, as all sectors of public spending are affected, overseas students should not be exempt.
Perhaps I may now try to answer some of the specific questions that I have been asked. One point which has been made, and which I recognise, is that, whereas the percentage of overseas students over all universities in England and Wales is about 12 or 13 per cent. and in Scotland about 8 per cent., there are particular institutions and universities where the percentage of overseas students is very considerably higher. This was a point made by the noble Lord, Lord Robbins, I think, and by others; and I have been asked whether there will be a review of the effects of full charging. I should like to say that my right honourable and learned friend will keep a close watch on developments. The policy on full cost fees will be looked at when the position on enrolments is clear for the university and for the public sectors, but we do not believe we shall have a clear picture until we are well into the 1980–81 academic year.
I have been asked yet again about unit costs and marginal costs, and why we cannot in fact use marginal costs and not unit costs. I am advised that in fact the UGC grant is based on unit costs for students, and that in the academic year 1978–79 there were in fact 36,500 overseas students, whereas the grant, based on unit costs, covered only 31,000 students. It is thought that in the academic year 1979–80 there are 35,000 students—the figures are still provisional at this time of the year—whereas the grant was originally settled for about 30,000 students. It is in fact based on the unit costs, and the fact that there are more overseas students than have been allowed for indicates that the universities have been efficient and have clearly lowered their unit costs in order to be

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able to take in these extra numbers. But this is the way the funding is done, and it would be difficult, I think, to change over to any other form of costs, particularly in the institutions where they are clearly not just a marginal cost to the university.
It has also been said that our full cost fees in 1980–81 will be the highest in the world. This is not in fact strictly true. Our fees will be high because our costs are also high; not least as the result of our favourable staff/student ratios. For example, in British universities the ratio is 1 to 9·2 students compared with 1 to 20 in France and 1 to 23 in Italy. Our costs are high because our standards are high and because of the individual attention given to students—unlike some countries, where a place at an academic institution often means little more than access to lectures. Our fees will still be broadly comparable with those of the leading private universities in America, where the fee can be $5,600. But the fact is that a degree course in the United Kingdom is normally only three years, while in America, of course, it is four years. That is much more common. Therefore, the total average cost at a British university is lower. A British university is still a very good buy, and why everybody should take this appallingly depressed view about something which has attracted so many people and which, on close examination, stands up as being something of great value, I really do not know. After all, if one looks at European universities, in France it takes you between five and seven years, and in Germany between four and six years, to get a degree; and when one comes down to a first degree in three years in this country, it is a very remarkable achievement.
Indeed, we believe that our overall policy is more discriminating than some of its critics are prepared to acknowledge. As my right honourable and learned friend announced in another place on 27th November, there will be a new scheme of assistance to postgraduate students. My noble friend Lord Amory asked whether we would not try to mitigate some of the hardships; and, indeed, the scheme recognises the difference, which the noble Baroness, Lady David, asked whether we acknowledged, between undergraduates and postgraduates. In the first year of
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this scheme—that is to say, 1980–81—some 400 to 500 research students of high academic merit will receive awards equivalent in value to the difference between the fee for a home research student and the fee which would normally be charged to the overseas research student. On average, the award will be about £2,000 per student. Secondly, in view of our membership of the EEC, we are considering how students from other Member-countries may be given favourable treatment. I am sorry that I cannot add anything to this answer. I recognise that it does not advance the answer I gave to the noble Baroness about a month ago. But when I can tell her that I have the information, I will do so.
The noble Lord, Lord Stewart of Fulham, asked me about refugees, as did the noble Baroness, Lady David, and I should like to say that the general responsibility for refugee students as a special category does not fall to the aid programme; but the ODA has given assistance in recent years to such students from certain developing countries. Some were already studying in the United Kingdom when they became refugees because of the political situation in their home country. Others were following, or about to begin, courses of further education in their own countries and came to the United Kingdom as refugees and continued their studies. These schemes covering refugees from Chile, Uganda and Ethiopia are administered by the World University Service with grants from ODA. The Uganda scheme will be phased out and replaced by a normal technical co-operation training programme when conditions permit. The noble Baroness, Lady David, also asked about possible Vietnamese students. I will write to her on that point. It is not yet clear how this will work.
The Government have reaffirmed their commitment to the principles and obligations of overseas aid. We continue to give substantial support to the execution of the developing countries' plans for social and economic advancement. For many years we have co-operated in the transfer of skills to the Third World. Over the years there have been changes of emphasis and new needs have emerged. The developing countries, with our help, have nurtured their own schools, universities and training colleges and have

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evolved their own cadres of administrators and professionally qualified people.
Our task now is to help the overseas governments and institutions to fill gaps and improve standards: by supplying those specialist skills which are in short supply; by sending them trainers of trainers; and by providing, in Britain, those kinds of academic or technical and vocational training and research facilities which in many of the developing countries are not yet readily available. Thus, our courses in many branches of technology, management of natural resources and public administration, to name but a few areas of training, are highly regarded by the governments and other institutions in some 120 countries. The range is wide and, although relevance to the social and economic needs of individual countries must be the major criterion, it is applied with considerable flexibility. Much of the training we support is on standard courses at universities, polytechnics and training colleges; but some 60 courses have been specially designed for the needs of the Third World.
The noble Lord, Lord Hatch of Lusby, asked me about the British Council. I think at this late hour I will not rehearse all the arguments because I believe that there will be a debate in the House on this very subject next week. I should like to say that the Government recognise that the British Council has an important role both in the administration of the work with overseas students, including the placing of students and helping them with their accommodation and paying their allowances. One of the factors that I think one must consider both in the case of the British Council and, indeed, over the aid programmes is that if we could only get our economy right, if only we could put our own house in order, we should not have to go around apologising all over the world for the state of the country. I think there is something to be said, even if we have to cut back on desirable projects now, for getting our economy right rather than having to go round borrowing money, often to subsidise what appear to be, and are, in many instances, very valuable and nice projects; but at the same time not having the strong economy that we should like to see. We must put our own house in order first.
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In 1978–79 some 15,000 overseas students were supported in the United Kingdom under FCO, ODA and the British Council programmes. These are hardly the richest students and, although the students who qualify for support under these schemes form a relatively small proportion of the total numbers in Britain, we believe that they should continue to be the focus of our efforts on behalf of students from developing countries. Provision for aid-financed training programmes for 1980–81 has yet to be finalised, in the light of the Government's review of expenditures and having regard to the levels of aid expected to be available for each country. The costs of travel, fees and maintenance will have increased by 1980–81, and we cannot yet say what targets we will be able to set. But we expect to continue to finance a very substantial number of these key people, and we will meet their full fees and costs. Most of these people, as I say, are nominated by their Governments for courses related to the country's manpower needs.
The noble Baroness, Lady David, also asked me about the training programme for Rhodesia. Currently, there are 2,300 Rhodesian Africans who are supported at United Kingdom institutions at an estimated cost of £7 million. New awards have totalled 1,350 which is four times larger than last year's intakes, and makes the Rhodesian programme by far our largest training programme for an African country. In addition to the programme in the United Kingdom, we are supporting some 500 Rhodesian Africans at the University of Rhodesia, some 400 at educational institutions in other Commonwealth developing countries and 60 students at the YMCA Secretariat College in Salisbury, Rhodesia. These programmes will cost £1,600,000 in 1979–80.
The future of these programmes depends on the outcome of the Constitutional Conference. If there is an internationally recognised legal Government in Rhodesia with whom we can discuss their aid priorities for 1980, then we shall do so. Provisional figures of £8,110,000 for 1980–81 in respect of the programme at United Kingdom institutions for continuing awards only and £598,000 for the programme at the University of Rhodesia are being considered by the Treasury.

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We will also continue of course to support the Commonwealth Scholarship and Fellowship Plan and British Council scholarship schemes which maintain a valuable flow to the United Kingdom of overseas people, mostly at postgraduate level, of high calibre and promise.
Lord DAVIES of LEEK: My Lords, may I ask the Minister a question? I apologise but it has been a fascinating but sad debate. Regarding Commonwealth scholarships, have the Department of Education had any discussions with the Ministry of Defence? Is the noble Baroness aware that scholarships sometimes are given to young men from the Commonwealth who join our Army, Navy or Air Force to become engineers, dental surgeons or even surgeons in medicine? Are they interfering with scholarships for those people or are they leaving that to the common sense of the Ministry of Defence who want to fill up the echelons of medicine, the dental service or engineering?
Baroness YOUNG: My Lords, I am sorry, I do not think I can give an answer to that question at this time of night. May I write to the noble Lord?
Lord DAVIES of LEEK: Yes. I only wanted to get it on the record. Thank you.
Baroness YOUNG: My Lords, these schemes, the Commonwealth Scholarship and Fellowship schemes, cover both the old and the new Commonwealth developed and developing countries. For a non-Commonwealth advanced country, the USA, there is the Marshall Scholarship Scheme. Under this Scheme 30 American graduates are brought to this country annually for a minimum of two years to read for first or higher degrees at British universities. The 1980–81 draft estimates of the Marshall Aid Commemoration Commission provide for the support of 72 Marshall scholars in the academic year 1980–81 at a cost of £295,000 on tuition fees and maintenance out of a total expenditure of £385,000.
A number of noble Lords have asked me about our future plans and our arrangements. I have been particularly grateful for a number of constructive ideas that
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have been put forward. I have made a note and shall study carefully tomorrow the record of what was said by my noble friend Lord Vaizey, and I shall certainly draw that to the attention of my right honourable and learned friend.
In conclusion, I am grateful to the noble Lord, Lord Garner, and of course to the noble Lord Annan, for the constructive and helpful points that he made about how we might consider the whole question of university finance, and of course the problems that arise with the recognised fall in the numbers of home students following upon the drop in the birth rate. The Government see the rationalisation of course provision between universities as a possible way of reducing expenditure. It is recognised, however, that this would not be a quick or simple solution.
This and other schemes for making economies, whether selective or general, are, we believe, primarily matters for the universities and the University Grants Committee, but the professional advisers in the Department of Education and Science would always be ready to assist. I very much hope that these suggestions, which I believe are very valuable and which we will take note of, are matters that will be followed up—because we do recognise that, coming into a situation where we have had to make very difficult decisions within a relatively short period of time, is not the easiest way to go forward for a lot of people who have to plan for the long term. We should therefore very much like to see a number of these proposals followed up in the spirit in which they have been offered.
May I say in conclusion that the Government's policy of reducing public expenditure has meant that we have had to consider all aspects of educational expenditure, including that on overseas students. However, we do believe that, through the continuing aid programme, the new bursary scheme for post-graduate research students, and possibly students from other EEC countries, our policy will be as discriminating as possible. It will seek to strike the right sort of balance between meeting our international obligations, maintaining the international character and reputation of our institutions, particularly the qualities of excellence in so many of them, and at the same time spending only what we can, as a country, afford and no more.

BRITISH RAILWAYS (No. 2) BILL
The Queen's consent signified; reported from the Unopposed Bill Committee with amendments.
HOUSE OF LORDS OFFICES
Second Report from the Select Committee made and to be printed.
SLAUGHTER OF ANIMALS (SCOTLAND) BILL [H.L.]
Reported from the Joint Committee with amendments, and recommitted to a Committee of the Whole House; Bill to be printed as amended.