Lords Sitting of 4 August 1980

Preamble
(Sitting in the Royal Gallery)
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of London.

HER MAJESTY THE QUEEN MOTHER
The LORD PRESIDENT of the COUNCIL (Lord Soames)The LORD PRESIDENT of the COUNCIL (Lord Soames) rose to move, That an humble Address be presented to Her Majesty to convey to Her Majesty the wish of this House to be associated most warmly with the congratulations offered to Her Majesty Queen Elizabeth the Queen Mother on the occasion of Her 80th Birthday:
To assure Her Majesty of the profound affection and esteem that is felt for Her Majesty Queen Elizabeth the Queen Mother both by this House and by the Nation and the Commonwealth for whom She has so long been an inspiration and to whom She has given such devoted service:
To express the heartfelt hope that Her Majesty Queen Elizabeth the Queen Mother may long enjoy health and happiness.
The noble Lord said: My Lords, I rise to move the first Motion standing in my name on the Order Paper and I shall, with the greatest pleasure, speak to both Motions.
When Lady Elizabeth Bowes-Lyon consented—not, I believe, without some persuasion—to leave the freedom of her happy Scottish-based home life and to marry the man she loved, she could not have guessed that the twists and turns of history would combine to make her Queen Consort. When the Duke of York became King the whole fabric and foundation of the Monarchy had been shaken to the core by the constitutional crisis of the Abdication. Many of your Lordships will recall at that time Queen Elizabeth's shining confidence in King
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George VI and the constant support she gave to him as the country moved into the dark days of war which were so soon to follow.
Together the King and Queen remained embattled with us, sharing the risks, the anxieties, and the tragedies of their subjects. Totally impervious to all suggestions that she and the Princesses should seek safety in some remoter part of the Commonwealth, Queen Elizabeth stayed to cheer and calm and encourage the nation.
Perhaps one of the greatest of the many services which Her Majesty Queen Elizabeth has rendered us—and I suspect the one which has personally given her the greatest satisfaction—was the reestablishing at the heart of the country and Commonwealth a Royal yet real family; with mutual affection, simple spontaneous joy in the normal pleasures of life, and a strong sense of duties to which all members of that family are inescapably called, inspired by a firm faith in God; a family life that shone forth as a beacon in a distracted world—
"Here firm though all be drifting".
And it was from this stable, enriching and exemplary family life that in her turn, when the time came, our present beloved and admired Queen emerged to bear the burdens of sovereignty.
My Lords, none, of course, could have foreseen in the early years of this century the nature and variety of duties which its constant and remorseless change, politically and socially, was to impose on the young Duchess of York. She has undertaken and performed them—whether as Queen Consort, Queen Mother, grandmother or great-grandmother—not only with untiring and selfless devotion, but also with grace, perceptiveness and spontaneity. It is perhaps (if I may put it thus) this evidently natural relish for her task that has done so much to endear Her Majesty to the many thousands of people throughout the globe who have been encompassed by that radiant smile, that lively and unaffected personal interest and sympathy, that ever-twinkling eye.
Now, at a time of life when ordinary mortals have long since aspired to take things more easily, the Queen Mother continues to attend numerous public functions; and in private she receives a

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constant stream of people from all over the world with whom she has made friends on her many and extensive journeys. As University Chancellor, as Lord Warden of the Cinque Ports, as a connoisseur of pictures, as a lover of music and of country pursuits, of the steeplechase and the river bank, she continues to revel in life and to touch it, and us, at so many points.
The whole country and Commonwealth is joining in this joyful Birthday celebration, and we in this House, I know, wish to express our fervent thanks to Her Majesty for a lifetime devoted to the service of our country. We wish her, from our hearts, long life and happiness, and we join with millions of others throughout the world in saying:
"Happy Birthday, your Majesty,
Happy Birthday to you".
Moved, That an humble Address be presented to Her Majesty to convey to Her Majesty the wish of this House to be associated most warmly with the congratulations offered to Her Majesty Queen Elizabeth the Queen Mother on the occasion of Her 80th Birthday:
To assure Her Majesty of the profound affection and esteem that is felt for Her Majesty Queen Elizabeth the Queen Mother both by this House and by the Nation and the Commonwealth for whom She has so long been an inspiration and to whom She has given such devoted service:
To express the heartfelt hope that Her Majesty Queen Elizabeth the Queen Mother may long enjoy health and happiness.—(Lord Soames.)
Lord PEART: My Lords, on behalf of Her Majesty's Opposition in the House of Lords I should like to express our sincere and warm congratulations to a great and gracious lady, Her Majesty Queen Elizabeth the Queen Mother on the occasion of her 80th birthday. Tributes have been paid to her selfless devotion to the people of this country and the Commonwealth; to her great courage in the company of her husband, the late King George VI, in the dark days of the war; to her gaiety, charm and wit; to her stabilising influence on the Monarchy—yet she has emerged as a real person who has entered into the hearts of the British
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people. And so, in the words of the Motion, may we wish her a long life and happiness in the years to come.
Lord BYERS: My Lords, those of us who have been fortunate enough to meet the Queen Mother on numerous occasions over a long period of public life have been able to identify with no difficulty at all those characteristics which have inspired in all of us the admiration and affection which we feel for her.
The first time, my Lords, that I met her was 46 years ago when, as a boy at Westminster School, I was doing some scene shifting for a charity concert. She was not only introduced to all those of us who took a small part in that activity but she had all the time and all the interest for each person she met. Only a few weeks ago at the unveiling of Field Marshal Montgomery's statue she talked to far more people at the ceremony than she need have done, and again with that deep sense of personal interest she has for everyone she is introduced to.
My outstanding memory of her was of the way she captivated the members of the American delegation who came over here in connection with the American bicentennial and the presentation of Magna Carta. They simply adored her, as indeed we do. I think that the Queen Mother's attributes are best summed up in the remark of a cockney lady who was heard to say: "She is really just like all of us, but much better". My Lords, on behalf of my colleagues on these Benches and myself, I support the Motion.
Baroness HYLTON-FOSTER: My Lords, noble Lords sitting on the Cross-Benches are very happy to be associated with the terms of the Motion proposed by the noble Lord the Leader of the House. Cross-Benchers are jealous of their position as independents and they do not normally speak with one voice, but there are always exceptional occasions and I am delighted to say that there is no doubt about their unity today in their devotion to Her Majesty the Queen Mother.
Many Cross-Bench Peers have served overseas in the service of the Crown in the Queen's other realms, in the Commonwealth, independent territories and in foreign countries. They know how im-

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portant are the ties forged by the members of the Royal family, and many have vivid memories of the instantaneous response evoked by Her Majesty the Queen Mother on her many visits over the years across the seas. We join in the tributes to the incomparable services of this sparkling Royal lady in the past, in congratulations on her Birthday today, and in the hopes for a future that we pray may continue to be both happy and glorious.
The LORD ARCHBISHOP of CANTERBURY: My Lords, from these Benches, I want to add my own warm and heartfelt support to the Motion. All who have paid tribute to Queen Elizabeth the Queen Mother in these days have drawn on many different strands in her character, and they have not been short of material. In these sentences I hope that I can give voice to the gratitude felt by all who cherish the Christian and indeed the religious traditions of our society.
No picture of the Queen Mother would be complete without touching on her religious faith, since her life is rooted, as she herself has put it, in Christian truths which do not change in a changing world. In decades where there has been so much to pull us apart as nations and individuals she has set us an example of integrity, and the fact that she so obviously enjoys life has been, and still is, one of the mostpowerful commendations of that example.
As a focus of affection she has also been a source of inspiration and encouragement to countless good causes and to innumerable less fortunate individuals. As her contacts with them have never been merely formal so our thanks to her go far beyond an official gesture. In the end of the day we honour her not for a list of virtues and accomplishments, considerable though that might be, but for the unswerving consistency with which she has fulfilled her particular calling in all the ups and downs of the past eighty years, to the immense benefit of this nation and Commonwealth. We pray for her, and we pray that she will continue to enjoy good health as we shall continue to need what she has to give to us all.
On Question, Motion agreed to, nemine dissentiente: the said Address to be
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presented to Her Majesty by the Lords with White Staves.
Lord SOAMES: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That a Message be conveyed to Her Majesty Queen Elizabeth the Queen Mother to offer to Her Majesty the congratulations of this House on the occasion of Her Majesty's 80th Birthday:
To assure Her Majesty of the affection and admiration in which Her Majesty is held by this House and the gratitude felt by the Nation and Commonwealth for a lifetime devoted to their service:
To wish Her Majesty long life and happiness in the years to come.—(Lord Soames.)
On Question, Motion agreed to, nemine dissentiente: the said Message to be conveyed to Her Majesty by the Lord Archbishop of Canterbury, the Lord Chancellor, the Lord President of the Council, the Lord Aberdare, the Lord Byers, the Baroness Hylton-Foster, and the Lord Peart.

HANDICAPPED CHILDREN: DISABILITY ALLOWANCE
2.50 p.m.
Lord ALLEN of ABBEYDALE: My Lords, I am sorry to have to bring the House back to earth, and 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 have come to any conclusion on the recommendation of the Royal Commission on Civil Liability (which was set up after the thalidomide tragedy) for a new disability allowance for severely handicapped children.
Lord CULLEN of ASHBOURNE: My Lords, the economic situation does not allow for the introduction of new benefits for disabled people or for the extension of scope of existing ones. We have noted the recommendations of the Royal Commission and will bear them in mind in seeking to meet our long-term

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objective of some form of general disablement benefit.
Lord ALLEN of ABBEYDALE: My Lords, while I thank the noble Lord for that reply, which falls some way short of the ideal, may I ask if he is aware that the Royal Commission estimated that there were some 100,000 children suffering from severe mental or physical handicap, that the strain on the family was immense and that the Royal Commission were unanimous in thinking that a substantial gap remained after taking account of all the existing forms of support? Is there any possibility of the Government thinking further about the principle involved in a compassionate society such as ours?
Lord CULLEN of ASHBOURNE: My Lords, the noble Lord is referring to one of 188 recommendations made by the Royal Commission, three of which were concerned specifically with children. The recommendation was for a new nontaxable disability income of £4 per week for all severely handicapped children, payable from age two, as an addition to child benefit. Unhappily, that would probably entail about 10,000 children and would cost £21 million. There is nothing more boring than going on saying we cannot afford it, but I am afraid that is what I must say.
Lord HOOSON: My Lords, may I ask the Minister to ask the Government to reconsider the matter? Although this may be but one of many recommendations, it is one with the highest priority, and the majority of people in this country no longer feel that in order to have adequate financial support for severely handicapped children it should be necessary for their parents, their best friends, next-door neighbours or whoever it may be to prove fault or blame, yet it is at present only through proving fault or blame that they are entitled to reasonable financial support. Is he aware that the whole community feels that this should be a priority?
Lord CULLEN of ASHBOURNE: The Government are by no means unsympathetic to this, my Lords; in fact very much the opposite. I would point out that in considering our long-term objectives, we shall have to decide whether any
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scheme can be introduced as a whole or whether public expenditure implications will dictate that certain sectors of the disabled population should be given priority; if necessary, all such claims, including those of disabled children, will be considered very carefully. I would add that if a disabled child meets the criteria for receipt of attendance allowance at the higher rate and of mobility allowance, then, from November of this year,£36·15 a week will be payable together with child benefit of £4·75.
Baroness FAITHFULL: My Lords, I wonder whether it is fully appreciated that the first of the thalidomide children are now adolescents and will soon be coining up to leaving school. Is my noble friend aware that with unemployment as it is in this country, and bearing in mind the needs of adolescents who are thalidomide cases, there is great need for extra help and support?
Lord CULLEN of ASHBOURNE: I entirely agree with my noble friend, my Lords, and while what she says is a well known fact to my right honourable friend, I will pass on her remarks.
Lord SEGAL: My Lords, would the Government consider whether this particular recommendation of the Royal Commission could be synchronised with the next fall in minimum lending rate?
Lord CULLEN of ASH BOURNE: That is rather above my form, my Lords.

OFFICE OF MANPOWER ECONOMICS: TEACHERS' PAY
2.55 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 what action they are taking with the Office of Manpower Economics in the light of the gross error for which that office was responsible in the supply of information to the Clegg Commission in connection with the question of teachers' salaries.
The MINISTER of STATE, DEPARTMENT of EMPLOYMENT (The Earl of Gowrie): My Lords, in accordance with the recommendation of Sir Alan Marre, whose report on the causes of the error is being placed in the Library, strong instructions have been issued to the Office of Manpower Economics staff to ensure that they are aware of their responsibilities for checking factual material.
Lord BOYD-CARPENTER: My Lords, while thanking my noble friend for that reply, may I ask him whether it amounts to any more than saying to the Office of Manpower Economics, "Please do not do it again"? Is he aware that in local government the district auditor would hold personally responsible officials who committed errors costing even a small fraction of the amount involved by the error in this case?
The Earl of GOWRIE: My Lords, I agree with my noble friend about the seriousness of the error. On the other hand, setting up a report, publishing it and making strong recommendations is rather more than simply saying, "Do not do it again".

HEATHROW-VICTORIA: COACH SERVICES
2.56 p.m.
Baroness BURTON of COVENTRY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are aware that the Heathrow Airport Consultative Committee was informed on the 16th July last at a session open to the public that British Airways is holding discussions with its staff about the ending of the coach services from Heathrow to the Victoria Terminal; and whether they will make a statement.
Lord MOWBRAY and STOURTON: My Lords, the Government are aware of what was said to the Heathrow Airport Consultative Committee on 16th July on this matter. The coach service operated by British Airways is a commercial matter
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for the airline's board and therefore one in which the Government do not seek to intervene. The number of passengers using the British Airways' coach service between Victoria Terminal and Heathrow continues to fall. British Airways are losing money on the service and have made it clear on a number of occasions that, in view of the necessity to reduce costs in general, they could not contemplate indefinite acceptance of these losses. However, as has been made clear to your Lordships' House on previous occasions, British Airways have so far made no decision to withdraw the coach service.
Baroness BURTON of COVENTRY: My Lords, if the Minister does not mind my asking him, is he aware that that is a better Answer than I had anticipated getting in view of our discussions last Friday? Is he aware of the seriousness of the matter and that in the last three months I have had three different Ministers answering three such Questions and that we have not got anywhere on any of them? Travellers are not asking for a subsidised service but a service for which they are perfectly willing to pay. I believe that in the past the Government have not been aware that the answers we have been given have not been true. I do not mean to say the Government do not think they are true, but they have not been correct. To show good faith, may I ask the Minister to give a guarantee that the Government will ask British Airways at least to consider not withdrawing the service until there is something else to take its place?
Lord MOWBRAY and STOURTON: My Lords, I am grateful to the noble Baroness for the moderation of her supplementary. Her perseverance in this matter has been enormous; three Questions to three Ministers, now a fourth Question to a fourth Minister, have been necessary to deal with her perseverance in the matter, and one Minister has flown to South America, perhaps because he is so frightened of her. Basically, we are in a troublesome area here. Fewer than 7 per cent. of all passengers using Heathrow use the buses, so it is an uneconomic service. The noble Baroness said it was a service for which passengers would be willing to pay. If there are four passengers, it

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would cost about £7 on the bus, and I am advised that for four passengers it would not cost more than £15 by taxi. If you have a long air journey ahead of you and that sort of money is involved, then I would suggest that perhaps it is something one might think of. British Airways want to be helpful. If one is planning a journey, there are other means of travel; for instance, Gatwick is served by railway to the door.
Baroness BURTON of COVENTRY: My Lords, will the Minister please give some thought to what I have said? Is he aware that we are back again to the problem of people with luggage? He speaks of a fare of £7. Is he aware—I apologise to the House for being personal —that not long ago I took a taxi from Heathrow to Central London, to a point near Marble Arch? I had a good driver, and there was no traffic. The charge on the clock was £10·90, and with a tip the total came to £12. I maintain that that is quite outrageous. Is the Minister aware that some of us in this House, and outside, are trying to find a consortium which would operate a bus service from a central area and which we could make economic? Can we have the Government's assurance that they will do their best to see that the present bus service is not withdrawn, anyway until after our Recess when we can return to the matter once more?
Lord MOWBRAY and STOURTON: My Lords, I have already assured the noble Baroness that the Government have no information from British Airways that they are intending to withdraw the service—which information the Government would have to have. There are the Alder Valley and Green Line services at half-hourly intervals from Heathrow to London. I quite agree that travelling is not much fun for people with luggage, especially old people. Even someone middle aged, like myself, does not find it much fun when travelling having to look after one's wife and one's luggage. This is not an easy problem for any of us. The noble Baroness referred to charges of £10 to £12. I said that four people could travel by taxi for £15. For four people travelling by bus the cost is about £7. I am merely suggesting that double that amount is not a totally impossible
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figure when one is undertaking an air journey. The Underground service has proved enormously successful, though I accept that many people, for one reason or another, do not want to use it. However, this is an example of the market process in being. At the moment the market process is favouring the Underground, and this is what we are up against.
Baroness TRUMPINGTON: My Lords, I support everything said by the noble Baroness on the other side of the House, and I fear that my noble friend will find that he has a scourge at the rear of him as well as having one in front, because I do not agree with his answer. How are four people, who do not know one another, who may have a number of children and a lot of luggage, and who perhaps may be suffering from bad backs, to get together in order to share one taxi? Frankly, I do not accept my noble friend's answer. Is he aware of the system that operates from Chicago Airport, where a private service runs both north and south of the city, conveying passengers to hotels at each end of the city? I should like to know whether the British Airports Authority has thought of the commercial prospect if the service is given up? I am sure that there are private operators who would run the service, and I should like to know whether this point has been thought of for the future, since a bus service of some kind is very necessary for many people, even though they may not be in the majority?
Lord MOWBRAY and STOURTON: My Lords, I was not aware of the service at Chicago Airport, to which my noble friend has drawn our attention. No doubt the Airports Authority will take note of her point. I have said that there are already two bus services besides the British Airways' bus service. When our Transport Bill is fully operative, operators will be able to obtain licences to run such a service, whereas up until now London Transport has stopped them, whether for right or for wrong reasons I would not know. Life will be made easier for other people wishing to operate bus services when our Transport Bill is fully operative.
Lord MONSON: My Lords, given that Heathrow Airport is the main gateway to Britain for visitors from all over the

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world, does the noble Lord not agree that this is far too serious a matter to be left to the discretion of British Airways alone? If, for whatever reason, the service cannot be made to pay, would the Government not consider granting a modest subsidy to enable it to continue, as would surely happen in any other Western European country in similar circumstances?
Lord MOWBRAY and STOURTON: No, my Lords. We are absolutely adamant; we not not willing to subsidise this service.
Lord WYNNE-JONES: My Lords, will her Majesty's Government pay attention to the fact that a transport service to and from Heathrow is absolutely vital for people who are unable to pay the large taxi fares? Will the Minister bear in mind that at present British Airways runs the service, whereas in other countries similar services are not run by single airlines? Why is this service not run by the Airports Authority? Does the noble Lord realise that at present one can travel by British Airways' bus to only two of the three terminals? One ought to be able to get to all three terminals.
Will the noble Lord also bear in mind that at present it is very difficult to come back from Heathrow by British Airways' bus because tickets are not sold until the bus actually arrives, and since there is no timetable one does not know how long one will have to wait? Will he appreciate—
Several noble Lords: Speech!
Lord WYNNE-JONES: I am still asking a question, my Lords. Will the noble Lord appreciate the absolute, vital necessity of maintaining a proper bus service to and from Heathrow?
Lord MOWBRAY and STOURTON: My Lords, as my noble Leader has muttered to me, we have somewhat had this point before. British Airways has no flights to or from the third terminal referred to, and so in that case it is for the other airlines to provide a bus service. I have said that 93 people out of every 100 travelling do not use the bus service. I
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suggest that if the remaining seven are really desperate, they can usually find an alternative way of flying via Gatwick, which has a very good train service. This is a matter for the commercial judgment of British Airways.
Lord SOAMES: My Lords, I suggest that your Lordships have had a good hunt after my noble friend, and perhaps we might move on to the next Question.

TEXTILES: IMPORT DUTIES AND FAIR TRADING
3.7 p.m.
Baroness HORNSBY-SMITH: 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 which countries exporting textile products to the United Kingdom levy import duties on United Kingdom exports of textile products to their countries at rates at least 50 per cent. higher or 100 per cent. or more higher, or impose total embargoes on these imports; and what steps they are taking to increase fair and reciprocal trading.
The MINISTER of STATE, DEPARTMENT of INDUSTRY (Viscount Trenchard): My Lords, in 1979 over 98 per cent. of our imports of textile products and clothing came from 46 countries. In 24 of them, responsible for 74 per cent. of our imports, there are no tariff barriers against our textile product and clothing exports 50 per cent. or more higher than those imposed on imports here. There are tariff barriers 50 to 100 per cent. higher in nine markets, responsible for 10 per cent. of our imports, more than 100 per cent. higher in 18 markets, responsible for 23 per cent. of our imports, and total embargoes in seven markets, responsible for 8 per cent. of our imports. Many of these barriers are only against some of our exports. I shall circulate in the Official Report details of the countries concerned. Other important potential export markets have major barriers, but are smaller sources of imports.

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Some important barriers are being reduced as a result of agreements reached in the Tokyo Round of GATT Multilateral Trade Negotiations, or otherwise, and the Government take every appropriate opportunity to press for further liberalisation to help our textile and clothing exporters.
Following are the details of the countries concerned, referred to above:
1. Countries with tariff barriers against some United Kingdom textile product and clothing exports 50 to 100 per cent. higher than those imposed on imports to the United Kingdom:
Canada, Hungary, Iran, Malaysia, Malta, Poland, South Africa, Thailand, United States of America.
2. Countries with tariff barriers against some United Kingdom textile product and clothing exports more than 100 per cent. higher than those imposed on imports to the United Kingdom:
Bangladesh, Brazil, Czechoslovakia, Egypt, Finland, Hungary, India, Iran, Mauritius, Pakistan, Philippines, Poland, South Africa, South Korea, Taiwan, Thailand, Turkey, United States of America.
3. Countries with effective embargoes against some United Kingdom textile product and clothing exports:
Bangladesh, Brazil, India, Iran, Pakistan, Philippines, Taiwan.
4. The structures of the tariffs concerned are frequently very complicated and entries are based on an assessment of the level of barriers against important United Kingdom exports.
5. Information is not available for certain state trading countries whose tariffs do not have the same role as in market economies.
Baroness HORNSBY-SMITH: My Lords, I thank my noble friend for that very informative reply, and I am sure that the additional details that he has promised to publish in Hansard will be very closely analysed. Is he aware that the industry will certainly welcome his undertaking to pursue through GATT, the MFA and the Tokyo Round measures to provide greater reciprocity? I ask this because I suspect that among the countries charging 50 per cent. and 100 per cent. there will be found those most likely to take the higher quality goods which we are being encouraged to make. Does my noble friend not agree that hitherto most of the concessions on tariffs in these various rounds have been made by the EEC countries, while many of the industrialised nations outside of the EEC, quite regardless of their commitments to international agreements, protect their textile industries
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by devious subsidies which enable them to export cheap goods to Europe while putting quite prohibitive tariffs (some, as my noble friend has outlined, up to 100 per cent.) on our exports to them? How can this be reconciled with their comitments under international agreements?
Viscount TRENCHARD: My Lords, as I have already said, we shall certainly press for reciprocity in the areas of M FA and others via the Community, through whom and by whom the negotiations must be conducted. Yes, my noble friend is right that in the lists which she will find in Hansard there are, outside the EEC, countries with a high standard of living which have tariffs substantially higher, on the whole, than those of the EEC and this country. The USA is prominent in that respect. But the tariffs have been negotiated under GATT in that case, and again in the case of the USA, for instance, they are steadily reducing, although from a fairly high level. I do not think I can go with my noble friend in saying that the USA and other developed countries outside the Community are in a special —I do not think she quite said unfair—position. In the case of the Americans, they do have the advantage of the exchange rate and the controlled energy and feedstocks supplies.
Lord GORONWY-ROBERTS: My Lords, will the Minister confirm that among the countries which impose no quotas or tariffs on textile imports from this country is Hong Kong, and that the Government of that country are actually in favour of the expansion of British exports to them? In view of the fact that Hong Kong is, I believe, next to the Soviet Union, the largest net importer of textiles, is the noble Viscount satisfied that our textile industry, which is in some difficulty, is availing itself of every opportunity to expand in this very large and thriving primary and secondary market in textiles?
Viscount TRENCHARD: My Lords, the noble Lord is quite correct in saying that Hong Kong is a major importer as well as a major exporter of textiles. In the main, the imports are of course to clothe the population of Hong Kong and the exports tend to be the higher added-value garments going abroad; and the

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majority of the imports, of course, come from her neighbour, China. So, while Hong Kong is a market, I do not think that the thesis that it is a huge export market for textiles from this country is entirely correct; but it is a very important market for many other areas.
Lord BARN BY: My Lords, while I thank the Minister for the very helpful and informative Answer which he gave originally to my noble friend's Question, may I ask him whether he will bear in mind the extreme distress of the wool textile industry? Will he also, as I am sure he does, bear in mind the very fine export performance which we are continuing to give in proportion to the total amount of exports from this country? Will he bear in mind that there is a widespread belief that the most important area from which difficulties arise for ourselves as members of the EEC is the merchandise which comes from the EEC, and can he see his way clear to exerting pressure to ensure the implementation of the regulations, which should be properly used, and to accelerate action under them, which ought to mitigate somewhat the big inflow from the EEC?
Viscount TRENCHARD: My Lords, we are aware of the difficulties of the wool textiles industry and, indeed, of many sections of the textile industry and clothing. We are also very aware of its very fine record in exports, right up to date. So far as the EEC is concerned, I think I have first to say to my noble friend that, as members of the EEC, there is of course not only nothing to object to but everything to be gained by free trade within that new market. Indeed, the growth of imports into this country from EEC sources is much greater than the growth of trade from the developing and cheap-cost countries. I think that perhaps I would refer the House to the textile debate which took place on 30th July in the other place, and to the statements of my right honourable friend the Secretary of State for Trade, and the Minister of State, which have covered all these questions in considerably more detail than it is probably possible to do by way of Answer to a Starred Question and to supplementary questions arising from it.

THE CHAMBER: REPAIR OF CEILING
3.17 p.m.
Lord SOAMES: My Lords, with the leave of the House I will make a Statement.
Arising from a meeting of the Administration Committee last Thursday, I can now give a further report to the House on the position concerning the state of the ceiling of our Parliament Chamber.
The committee were in no doubt that every effort must be made to get the Chamber back in use in time for the return of the House after the Summer Recess. The committee were advised, however, by a team of officials from the Property Services Agency that, while the condition of the cast-iron roof trusses and main timbers was quite sound, the state of the decorative ceiling was such that the job of repair and restoration would be long and costly, and more examination and more time would be necessary before firm plans could be made. The committee were told that, subject to this further study, the job could last well into 1982.
The PSA team therefore proposed a solution in two stages. The first is a what you might call "get us back" service of the installation of a protective working platform-cum-temporary ceiling some few feet below the present ceiling and covering the whole House. This would serve two purposes. It would enable the House to resume sittings in safety on return from the Recess, and it would also provide the working platform from which the further examinations of the old ceiling could be made and also from which, as the second stage, the eventual remedial repairs would be undertaken.
The technical intention is that this working platform should be supported by beams, girders and scaffolding, to which I am sure your Lordships attach a great deal of importance; and while some of the scaffolding would be visible from inside the Chamber, most of the supporting structure would be outside. In other words, the lateral beams would extrude through specially made gaps in the tops of the side windows, and would connect with external vertical supports.

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The PSA have an assurance from the scaffolding contractors that the platform could be in position some few days before the end of September; and your Lordships' Administration Committee have, indeed, specified the weekend 20th–21st September as the target date. This has been accepted by the PSA, and would give sufficient time thereafter for our own PSA staff to get things back in order and ready for the Lord Chancellor's usual annual reception in the Royal Gallery on 1st October for the start of the legal year; for the Law Lords to sit in the Parliament Chamber on 2nd October; and, of course, for your Lordships to resume sittings on 6th October.
Costings have yet to be properly worked out, and your Lordships will understand that costs for the whole project must await the further examinations and detailed planning. The PSA are estimating a rough order of costs for the initial stage, Stage I, of some £150,000 during the current financial year.
The Administration Committee were clear that the priority requirement was to get the Chamber hack in use well in time for the end of the Recess. The committee have therefore approved the installation of the working platform by 20th September as Stage 1 of the action required and will give further consideration to Stage 2—that is, the programme to complete the remedial action to repair and restore the ceiling—following the further examination to be put in hand by the PSA thereafter.
We can therefore be hopeful, barring accidents and the unforeseen, that we shall be back in our usual Chamber under the protection of the working platform above our heads on return from the Recess. I think that the House will agree that the Administration Committee were right to settle on this as the first step.
3.22 p.m.
Lord PEART: My Lords, I am sure that the whole House will welcome this Statement and thank the noble Lord the Lord President and Leader of the House for making it. It is an important Statement affecting the House. I am glad that there is a measure of optimism; and if we can achieve the target, that will be something well done. Black Rod and
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his staff have done a wonderful job; so have the property agencies. We pay tribute to them all. Let us hope we can get back soon!
Lord WIGODER: My Lords, may I say from these Benches how grateful we are to the PSA for the speed with which they have carried out their inspection and for the solution that they have devised, which appears from the plan and sketches that I have seen to be nothing like as unsightly as might otherwise have been feared. We all look forward to being back in our proper Chamber immediately after the Recess.
Lord SOAMES: My Lords, I want to thank the noble Lord, Lord Peart, and the noble Lord, Lord Wigoder, for the remarks that they have made. I know that the House will join with them in thanking the PSA staff, indeed the whole staff and Black Rod and, I think, the Administration Committee for having taken this matter in hand and providing what I think is the proper and probably the only solution to suit your Lordships.
Lord MISHCON: My Lords, as one of the Members of this House whose wisdom is always limited to matters after the event, may I ask whether it is a fact that the decorative state of the ceiling had not been inspected for many years? Indeed, I have heard one version which says that it has not been inspected since 1834. Have we at least learned the lesson—and I see the gesticulations of the noble Lord the Leader of the House; and I may say that I am referring to our own Chamber—which appears to be a very expensive one in this instance, that regular inspections hereafter should be carried out?
Lord SOAMES: My Lords, this might be a wise suggestion made by the noble Lord, Lord Mishcon. I am afraid that I cannot comment on his assertion that the ceiling has not been inspected since 1834. I do not think that anybody in this House goes back in memory quite as far as that. Once it has been inspected and redone, I should like to think it will last for quite a while before having to be inspected again. There are probably other lessons to be learned about other chambers in the Palace of Westminster which might need inspection.
Lord SHINWELL: My Lords, may I ask the noble Lord the Leader of the House whether these adjustments that are to take place are likely to affect the acoustic properties of the Chamber as they were? They could hardly have been considered completely effective despite every effort on the part of those who service the House and Chamber; but if there are now certain adjustments to be made, it is just possible that the acoustic properties might not be as satisfactory as Members of your Lordships' House would like.
Lord SOAMES: My Lords, in reply to the noble Lord, Lord Shinwell, there will, I think, be a marginal effect on the acoustics in the Chamber while the false ceiling is in position. I am hopeful that it will not be anything with which we cannot all comfortably live. The acoustics were excellent before. I hope they will be at least good when we go back with a false ceiling. They will be better than they are here, anyway.
Lord GORDON-WALKER: My Lords, can the noble Lord say when the ceiling of this Chamber was last inspected?
Lord SOAMES: My Lords, I suppose that if the noble Lord, Lord Mishcon, was right, it would have been 1834.
Viscount St. DAVID: My Lords, in view of the fact that it is found necessary before the opening of each Parliament to investigate what is happening underneath our Chamber, might we now not add an investigation of what is happening above each year?
Lord SOAMES: Yes, my Lords, it is inspected every year underneath. I do not see why that should not continue.
Lord DRUMALBYN: My Lords, can my noble friend say whether, at the time we are debating in the other Chamber after the false ceiling has been put in place, work will be going on above us, and what will be the effect of that on audibility?
Lord SOAMES: My Lords, we shall have to see what it all looks like at the end of the day. The inspection process will go on when the House is not sitting and not while the House is sitting.

DEER BILL
3.28 p.m.
Lord NORTHFIELD: My Lords, I beg to move that this Bill be now read a third time. At this late stage of the Bill I have only three short points to make. First, I should like again to thank the successive Home Office Ministers and also the Home Office officials who have helped with drafting and later reshaping of the Bill. Some who helped in the initial stage three years ago have moved on to other duties. I hope that my thanks will reach them. My special thanks are due to Mr. John Hotchkiss, vice-president of the Deer Society who, in a personal capacity, has been my patient guide and untiring negotiator in these years. The second short point is to say to those of your Lordships who are concerned that some parts of the longer Bill have been abandoned for the time being, that we hope to be back in future Sessions with those further points and hopefully with a Government Bill on deer farming as the framework for our future study of the problem.
Thirdly, as this Bill, I trust, will receive your Lordships' approval and then move on to Royal Assent, I hope that we may say as strongly as we can that it is the earnest hope of this House that the powers in the Bill will be used to the full once it becomes an Act. There are strong powers for the police, strong powers for the courts in forfeitures and fines of up to £500 per animal in case of poaching. As an article in today's The Times indicates, this is a grisly, barbaric business that has assumed the proportions of a national scandal. Large-scale deer poaching is a very profitable business, and the cruelty that is involved grows because of that. One man is on record in The Times today as claiming that he has successfully poached 200 deer. My calculation is that he has made at least £20,000 out of those escapades alone. This is a very unhappy situation in the countryside, and I hope that this Bill, which has taken a long time to get on to the statute book, will now receive your Lordships' approval and will go a long way towards stamping out this cruelty and making the countryside the happier for that.
Moved, That the Bill be now read 3a.—(Lord Northfield.)
On Question, Bill read 3a and passed.

SOCIAL SECURITY BENEFITS (UP-RATING) ORDER 1980
3.30 p.m.
The MINISTER of STATE, DEPARTMENT of EDUCATION and SCIENCE (Baroness Young): My Lords, I beg to move that the draft Social Security Benefits (Up-rating) Order 1980, which was laid before this House on 17th July, be approved.
Following discussions with the noble Lord, Lord Wells-Pestell, we have accepted his suggestion that it would be for the convenience of the House if I now spoke to all seven instruments together, although, of course, each will be moved separately. I should explain that when I move each order it will be open to noble Lords to make points on each if they so wish. One consequence of this arrangement is that the explanation I shall be giving in introducing these orders will perhaps not be quite as detailed as it would have been had I been introducing seven separate orders. This is in order to keep my remarks to a reasonable length. We shall, however, do our best to answer the points that are raised in the course of the debate, and my noble friend Lord Cullen will be winding up at the conclusion.
These instruments fall into three main groups. First, there are the up-rating instruments; that is to say, those increasing the levels of national insurance and industrial injury benefits, child benefit, and family income supplement—FIS—next November. Second, there are the instruments giving effect to the first stage of the reform of the supplementary benefit system provided for in the Social Security Act 1980. And third, there is a group of two miscellaneous instruments. I turn straightaway to the up-rating instruments, and I would draw the House's attention to the report of the Government Actuary which was laid with the benefits up-rating order, in accordance with the statutory requirements. A full list of the main increases in benefits under this order is to be found in Appendix Ito the Government Actuary's report, but it may be helpful
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to your Lordships if I refer to some of the main items.
The standard rate of retirement pension for a single person goes up from £23.30 to £27.15, and for a married couple from £37.30 to £43.45. Widow's pension also goes up from £23.30 a week to £27.15; the higher rate of attendance allowance goes up from £18.60 to £21.65 and mobility allowance from £12 to £14.50 a week. The standard rate of invalidity benefit will rise from £23.30 to £26 for a single person and from £37.30 to £41.60 for a married couple. The standard rate of sickness and unemployment benefits will rise from £18.50 to £20.65 a week for a single person and from £29.95 to £33.40 for a married couple. These new rates take account of the provisions of the Social Security Act 1980 and the Social Security (No. 2) Act 1980. For this reason, the order could not be laid until both these Acts had received the Royal Assent.
Your Lordships have spent a long time discussing the provisions of those Acts. I do not wish to repeat what was said in those discussions, but the Government have had to face the economic facts of life. We have had to make hard decisions and have had to find savings in benefits in order to contribute to the Government's overall economic objectives. I accept that this includes provisions which we would have preferred not to make at all—provisions increasing short-term benefits and invalidity benefits by 5 percentage points less than the main long-term benefits and to up-rate pensions and other long-term benefits in line with prices, rather than prices or earnings, and to put back the up-rating date to the last week in November. It was, however, inevitable that the social security budget, costing some £20 billion annually, could not be exempt from economies, and I repeat now what I said at an earlier stage, during the passage of both the Social Security Act 1980 and the Social Security (No. 2) Act, that they in no sense add up to the end of the welfare state. Indeed, social security expenditure amounts even now to £1,000 for every household in the country.
Despite these changes, we have done as much as we can for those most in need. We have protected the position of retirement pensioners and widows by keeping the link with prices; we have maintained

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the "safety net" by raising the supplementary allowance in line with prices while aligning the supplementary pension with the retirement pension; and we have given additional help to the severely disabled by increasing mobility allowance substantially more than prices.
The new rates of benefit were announced by my right honourable friend the Secretary of State for Social Services in another place in March. They were based on estimates made at the time of the Budget that prices would rise by 16½per cent. between the up-rating date in November 1979 and the up-rating date in November this year. However, as my right honourable friend made clear in the debate on the order in another place last week, it is at the time of laying the order that the law requires him to make the best estimate he can of the increases necessary to restore the value of the benefit in question. And this he has done. As he explained in last week's debate in another place, he has taken the best advice available to him on this matter and he set out the factors which he took into account which led him to be satisfied that a 16½ per cent. increase is the best estimate of the increase needed at the time of the up-rating next November to restore the value of the benefits in question to the value they had at the time of the last up-rating in November 1979. Sixteen and a half per cent., therefore, is the figure on which the increase in retirement pensions and other long-term benefits, apart from invalidity benefit, is based, while short-term benefits and invalidity benefit will go up by 11·5 per cent., the 5 per cent. abatement being in lieu of full taxation of these benefits.
At this stage I should like to say a few words about the Government Actuary's report. Comment on the report has focused on the forecast surplus of £687 million in the National Insurance Fund over the financial year 1980–81. But it is wrong to leap to the conclusion that, far from making cuts in the social security programme, we could afford to expand it. First, there is the sheer uncertainty of such forecasts. For example, in December 1978, the Government Actuary forecast a small surplus for 1979–80 of £34 million. The latest report shows a surplus of £542 million for that year. Much the same happened in earlier years.
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The surplus or deficit in the year is the difference between two very large aggregates: the income from contributions and other sources and the payment of benefits. Quite small percentage changes on either side of the equation can produce very large fluctuations in the surplus. In any case, the surplus as a percentage of the actual outgo of the fund is a very small margin—much smaller than in many previous years. In 1974–75 it was 12·5 per cent. The surplus forecast for the current year is only 4·4 per cent. of the estimated outgo—18 weeks' worth of benefit compared with 86 weeks' worth in 1960 and 26 weeks' worth in 1970. So let me stress that there is absolutely nothing in the Government Actuary's report which causes the Government in any way to modify the view we have taken that it was only prudent and responsible to reduce the cost of the social security programme.
I turn now to the Child Benefit (Up-rating) Regulations. Here again, the increases are as forecast in the Budget. Child benefit goes up by 75p from £4 to £4.75 per child per week and the premium for one-parent families will go up by 50p from £2.50 to £3 per family per week. These increases bring the total annual expenditure on child benefit to some £3,000 million in a year. Of course, this was not as much as some had hoped for, but it was as much as the Government felt could be afforded at the present time. The Government's support for the child benefit scheme was underlined by the Secretary of State for Social Services in another place when he made the important announcement that it is the Government's intention, subject to economic and other circumstances, to up-rate child benefit each year so as to maintain its value. This, I believe, is a very important statement made by my right honourable friend the Secretary of State for Social Services.
I turn to now the Family Income Supplements (Computation) Regulations. FIS plays a key role as a benefit aimed at low income families at work. Because of the need to retain incentives for such families, the Government are making proportionately larger increases in FIS than in most other benefits. The maximum weekly rate for a one-child family is increased from £13.50 to £17 with a further £1.50 for each additional child, instead of the existing £1. From November, we anticipate that the average number receiving

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FIS will rise to about 95,000 families, compared with around 85,000 this year. The average weekly payment will rise to about £10 next year, compared with £7.50 at present. £10 will be almost exactly double the average weekly rate when we took office in May 1979.
These then are the up-rating instruments and I return to the point I made earlier—the need to be realistic about public expenditure levels. The primary need is to tackle inflation and to get the economy moving once again. We must keep these savings in perspective. The up-rating of benefits as a whole, including supplementary benefits to which I shall refer shortly, will raise expenditure on social security benefits by £3,000 million in a full year. This is an enormous sum by any standards.
I now come to the two miscellaneous instruments. The Pensioners' Lump Sum Payments Order deals with the Christmas bonus which we are repeating this year, as Conservative Administrations have done each year since we introduced it. But now we have introduced a statutory requirement to pay bonuses each year. I know that the bonus is greatly welcomed by pensioners and others who receive it who find even this modest help around Christmas most useful.
The other Instrument—Married Women and Widows (Special Provisions) Amendment Regulations—makes some technical changes which have been approved by the National Insturance Advisory Committee. To make the position clear, I can tell the House that the regulations do no more than bring the law into line with what both we and our predecessors thought had always been the position.
I now turn to the Supplementary Benefit (Requirements) Regulations 1980 and the Supplementary Benefit (Resources) Regulations 1980. My Lords, these two instruments contain the main provisions determining how a claimant's weekly entitlement to supplementary benefit is to be worked out. They are made under the Supplementary Benefits Act 1976, in the form given to it by the substantial amendments brought about by the Social Security Act 1980. Provision for the other type of benefit—single payments to meet exceptional needs—is set out in the
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Supplementary Benefit (Single Payments) Regulations 1980, which was also laid before Parliament with these two instruments.
These regulations and those laid with them represent a vital change in the legal structure of the scheme following the review of the scheme initiated by the party opposite. From now on the rules on benefit will be in published regulations, and will confer a clear entitlement. We are getting away from secret guidance. We are getting away from an adjudication system where there was no determining authority capable of establishing precedent and case law. Claimants should now know where they stand. The public—who pay for this scheme, and whose trust in it has been shaken by all manner of myths about what payments can and cannot be made for—will know where they stand.
Within the new legal structure based on clear entitlement defined in published rules, we need a more exact code of rules which reduces to an absolute minimum the discretion which has produced uncertainty and conflict between claimants and staff. Present discretion has led to great variations in practice between different localities in the amounts of extra payments and in how frequently they were given, variations bearing little relation to the true needs of claimants.
The requirements regulations set out the scale rates of benefit, other than those for pensioners, which the Act aligns with the national insurance pension rates. What we have done in most cases is to codify the Supplementary Benefit Commission's policy. This applies, for instance to Regulation 4, which defines "normal requirements"—the things for which the scale rates provide. This regulation is central to the new structure, since, by making explicit what these normal requirements are, it makes clear that extra payments will not, except in the abnormal case, be made for such items.
One important change to which I would draw your Lordships' attention is this: the number of scale rates for children is reduced from five to three—and beneficially so: for instance, those aged 0–4 will get the higher rate applicable to those aged 5–10. And when we come on in Regulation 7 to the conditions for

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entitlement to the long-term rate, there is another significant change: the qualifying period is reduced from two years to one year. And, as a smaller but useful easement, young people getting noncontributory invalidity pension in periods between their 16th and 18th birthdays will be able to count such periods towards qualification for the long-term supplementary benefit rate.
The regulations go on to give details of the two other components—additional requirements for people with extra costs for heating, diet, laundry and so on; and housing requirements—such as rent, rates and mortgage interest. If the sum of these requirements exceeds the claimant's resources, the balance is payable as supplementary benefit.
As regards the resources regulations, these adopt a change suggested in the Review Report—a single cut-off figure of £2,000. Up to that figure, capital has no effect on benefit; above it, there is no entitlement at all. The regulations deal also with the calculation of income from earnings, other benefits and other sources, what is to be ignored, what counts in full and what is disregarded in part. So far as disregards are concerned there is now a £4 disregard on earnings, and a further £4 on other income. In addition, lone parents will have one half of earnings between £4 and £20 disregarded, giving a maximum of £12—a valuable boost for those lone parents who do part-time work.
Although not strictly the subject of this debate, I ought also to mention the single payments regulations. They set out the items, usually unforeseen, nonrecurring costs, for which weekly benefit does not provide and for which extra sums are to be given—funeral expenses, maternity expenses, removals, furniture and so on. In the final two parts, they set out the exceptional cases in which payments can be made for things normally covered by weekly benefit—clothing, for example, where a need arises otherwise than from normal wear and tear; and they also provide a fall-back power to make payments in circumstances not covered by the regulations where this is necessary to prevent serious risk or serious damage to the health or safety of the claimant or his family. I am well aware that these last provisions have been criticised as too restrictive, but I must return to what
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I said at the beginning of my remarks. If we are to have clear legal entitlements, any long-stop must be carefully circumscribed, otherwise we shall return to a situation in which discretionary uncertainties develop and once again threaten the whole scheme.
I should add, of course, that there are further regulations yet to come in addition to those laid on 17th July. These will cover administrative matters such as the procedures for claiming and making payments, and appeal tribunal rules, and also further conditions about entitlement—for example, registration and availability for employment—and the rules for payment in cases of urgent need. My right honourable friend hopes to lay these regulations within the next two months or so.
My Lords, I am conscious that I have covered a lot of ground, a lot of detail and rather technical ground fairly quickly, but this, I think, is an inevitable consequence of dealing with the orders all together. In my remarks I have attempted to set out briefly and, I hope, clearly the purpose of the orders before your Lordships' House. I should make clear that they follow upon the two Social Security Acts which have recently passed your Lordships' House and which have been debated very extensively. I commend these instruments to the House.
Moved, That the draft Social Security Benefits (Up-rating) Order 1980, laid before the House on 17th July, be approved.—(Baroness Young.)
3.50 p.m.
Lord WELLS-PESTELL: My Lords, I am grateful to the noble Baroness the Minister for being prepared to take these orders altogether because some need more comment than others. It would be a saving in time if we considered them in the way that she has been good enough to agree. I will not be speaking to all the orders; I will be dealing with some and my noble friend Lord Wallace of Coslany will be dealing with the others.
Some of the regulations I have found very simple to understand; others I have found rather complicated, and perhaps I could take this opportunity of saying that I hope that they will be produced in a simple manner, easily understandable to

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all those who are likely to be interested. When we were discussing this matter my understanding was that there would be a supplementary benefit handbook available, and I am assuming that the regulations that do not apply will appear in some other form so that those who are interested will be able to read them very clearly. This is essential because we spent a good deal of time in Committee on both Bills emphasising the importance of the need for social workers and others who will be dealing with claimants to he able to understand what it is all about.
It may well be thought pointless to refer to what was said by the Government before and during the general election of last year. There must come a time when we have to accept the fact that what happened in May of last year happened. We have come to learn that we all know that the Government won but there is no doubt in the minds of some of my noble friends and I that a large section of the community lost as a result. I have in mind the child benefit allowance which we discussed very fully. I must take this opportunity of saying that we on this side of your Lordships' Chamber—and I believe those in other parts of the House—regard the No. 1 and No. 2 Social Security Bills as being both evil and against the interests of that section of the community that can least afford to suffer the cuts.
The child benefit allowance was introduced by a Labour Government and was due to be increased in November of 1979, although it was increased in the previous April of that year. The electors were encouraged to believe that the Conservative Party, if returned to power, would increase child benefit. There is ample evidence—even though it may not have been expressly stated in the manifesto—that this is what they promised to do.
The fact remains that the Government failed to do so. When the benefit is increased this coming November, 19 months will have elapsed at a time of increasing inflation. In November next, as the noble Baroness has told us, it will be raised from £4 a week to £4.75. If we work that out, it is less than 9 per cent. of the Government's own inflation forecast. Yet they spend so much time pointing out that, with the exception of certain benefits, benefits are going to be
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increased by 16½ per cent. When I say 9 per cent. less than the Government's own inflation forecast, that is assuming that the inflation rate next November will be only 16½ per cent. There seems very little hope or possibility of it coming down to that rate.
The benefit needs an increase of £1.20p to restore it to its real value, not '75p. It is not disputed by the Government that such an increase is needed to restore the benefit to its real value. I find it extremely difficult that the Government which attach so much importance, so they say, to the family and to children in particular, could not find other money to restore the benefit to its real value. The Government did not argue—and I hope they will not do so—that families with children did as well as anyone out of the budget or that families are better off now than they would have been under the old system of family allowances and child tax allowances. If anybody thinks so, then I ask them to look at the percentage of the increase in income after tax. They will see that a married couple with two children are worse off today than a couple with two children with earnings, taken in the 1979–80 period, of £3,000 a year, £5,000, £6,000, £9,000, £12,000, £15,000 or £25,000 a year. A couple with two children are now worse off than anyone else at a comparable incomes level.
Failure to increase the child benefit allowance in April meant that the £4 a week child benefit is only worth at the present moment about £3.15p per week. The noble Baroness has dealt with increases in family income supplement as well as child benefit and also in child benefit premium. Let me say that obviously any increase, whether or not it is adequate, is not only welcome but it is important. But the child benefit premium only helps about 4 per cent. of all working families in poverty.
As for the family income supplement, it is going to provide—and we must not disguise the fact—a really significant help. Such families and those of us on this side of the House welcome it. But we must bear in mind that family income supplement recipients are, happily, very small in number. The noble Baroness mentioned that something like 95,000 families would benefit: but what she did not say is that over half of those receiving family

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income supplement are one-parent families. The others are two-parent families where the increase in family incomes supplement is inadequate and does not do as much as we ought to be doing for them.
I want to say just a word or two about this 16½ per cent. I wonder whether the Minister has any up-to-date information regarding the Government's view about the amount of inflation next November. I also want to ask whether it is true that the Treasury has already forecast an error of 2 per cent. and that it will be 181, per cent. in November. I ask whether this will be the figure and, if so, whether the Government are proposing to make good the shortfall should it arise.
There is another point which I must ask your Lordships to look at. The Government, as the noble Baroness the Minister quite rightly said, fixed the last week in November for these benefits to be increased. That means that the past year, for people receiving retirement pensions and every other pension and benefit that this country gives, will have lasted 54 weeks, because it will be 54 weeks since they received the previous uprating in 1979. By a deliberate act of policy—do not let us mince words about this—they Government will have succeeded in depriving pensioners of two weeks' increase and, by doing so, they have saved £125 million. Those extra two weeks mean a loss of £12.30 to a married couple on pension because the pension rate for a married couple will be going up by £6.15 per week.
While the Government claim that pensions will increase in November next by 16½ per cent., is that a true figure, bearing in mind that it will be 54 weeks since the last uprating? Does not the 16½ per cent. become 16 per cent.? It is not so much that I am arguing over half a percentage point, but one-half per cent. is one-half per cent. and we might just as well state the position accurately. Can the Government truthfully deny that, while these regulations will benefit about 500,000 people, four times that number—about 2 million—will lose benefits?
As I say, I have no intention of fighting the battles that we fought over the first and second Social Security Bills, but I believe that it will go down in history as
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one of the worst possible things that a Conservative Government have ever done. We have taken away in many instances from the poor of this country and given to the rich. Never since 1930 have we had two distinct nations as we have at the present moment: the rich on one side and the exceptionally poor on the other.
Your Lordships may well feel that this is not the time to have an economic debate but, as I understand the position—although, so far as I know, though I may be wrong the figure has never been mentioned in your Lordships' House—a million unemployed in this country must be costing us not far short of £2,000 million a year and, as we have two million unemployed, the cost cannot be far short of £4,000 million a year. If my figures are right, we are paying out that vast sum of money to people who in return are unable to do anything to improve the economic position of the country. That money should be used in promoting industry and production, not in paying for idleness. In the Government Actuary's Report, the figure for the amount to be paid out in 1980–81 on unemployment alone is, I think, something like £992 million, but we have to take into account those who are not drawing benefit for one reason or another, those who are on supplementary benefit, and so on. We are paying out a tremendous amount and I think we have to look at the amount we are paying out for which we are getting nothing in return.
The only other thing I want to ask is this: can the noble Baroness say whether her right honourable friend the Secretary of State has yet named the chairman of the new Social Security Advisory Committee? My final word is that I hope the Secretary of State and the Department of Health and Social Security—a very able and competent department, if I may say so, and anyone who has had anything to do with that department will, when they cease to have anything to do with it, come away with sheer admiration for the skill, competence and ability found there—will see that there is some kind of pamphlet, handbook, or both, where these regulations are spelt out in words of one syllable, if that is possible. Such a thing would be of supreme importance to the vast army of social workers who will have to assist people in the future.
4.8 p m
Lord BANKS: My Lords, I should like to thank the noble Baroness for the very comprehensive and clear explanation of the nature and purpose of these seven orders which she has given to us. We arc, as she said, trying to cover a great deal of ground in one debate and, while it is true that we have discussed much of the background to these orders in the debates which have taken place on the two Social Security Bills which have been through this House, nevertheless I cannot help feeling that the supplementary benefit regulations will require a more detailed scrutiny than we shall be able to give them today. So far as the Pensioners' Lump Sum Payments Order is concerned, I do not propose to say anything about that, because my noble friend Lord Grey intends to say a word about it.
Turning to the following order, we on these Benches have made our attitude very clear already regarding certain features of it. We have made it clear that we regret the failure to make good the previous shortfalls and that we are worried about future shortfalls, particularly as the inflation rate may, as the noble Lord, Lord Wells-Pestell, pointed out, be in excess of 16½ per cent. over the 12½-month period which will have elapsed since the previous uprating. We have made it clear that we object to the cut in the real value of those benefits which are to suffer the abatement. We do not feel that the savings that will achieve are really necessary. The Government say that the social security budget is too large, but half of it is largely self-financing through the earnings-related contributions, the Treasury contributing only 18 per cent. of the cost of national insurance benefits, which make up half the total. There is no indication that this formula is not capable of providing the means to make available national insurance benefits without any cuts in real value.
The fact that the employers' and the employees' contributions are earnings related, with the Government's contribution being in constant relationship, means that the national insurance revenue next year must bear the same relationship to earnings up to the top limit as this year's does, and that is surely not a cause for alarm. There was a surplus last year in
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the National Insurance Fund. There is an estimated surplus at the moment, with all the qualifications which the noble Baroness rightly put upon that, which is much higher than the anticipated saving in the current year from the Social Security (No. 2) Bill. So expenditure is being kept within the limits provided by the revenue.
It is argued that the surplus is small in relation to benefits and is not itself sufficient justification for increases, and I would certainly accept that. But, equally, a surplus in a pay-as-you-go scheme is no excuse for cuts in benefit, either. There are two possible reservations to that statement. First, we know there is a possibility that unemployment may go considerably higher than it now is, and that might necessitate some adjustment in contribution rates. Secondly, we know that the reserve, while it is increasing in actual terms, is declining as a percentage of annual expenditure. But it is still substantial and the question should be raised as to whether it really is necessary to have a reserve of £5,000 million in a pay-as-you-go scheme. Even if it is felt that cuts are necessary, for quite other reasons to do with the public sector borrowing requirement and general economic strategy, by removing the upper limit on contributions enough would have been provided to make unnecessary the Social Security (No. 2) Bill.
The substantial increase in family income supplement will bring welcome help to low income families where the breadwinner is in employment. However, the increase in family income supplement, and the abolition of the 25 per cent. income tax band, have serious implications for the poverty trap. The Low Pay Unit have estimated that three-quarters of taxpayers in receipt of family income supplement were paying tax at 25 per cent. last year. A quarter of this group have been lifted out of tax, but the remaining 37,000, who used to pay tax at 25 per cent., will now pay it at 30 per cent. The House may feel that it is somewhat absurd for people in receipt of special assistance of the nature of family income supplement to be paying tax at all.
It is a fact that a couple with two children would be better off earning £55 a week than earning £75 a week, and a couple with four children would be better

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off earning £55 a week than £95 a week. That is an indication of the nature of the poverty trap which is exaggerated by increases in family income supplement, valuable though they may be for their limited but important purpose. All this underlines the need to get away from means-tested benefit to a tax credit system.
I should now like to say a word about child benefit. We have already expressed from these Benches regret that child benefit was not raised sufficiently to take full account of inflation since the previous uprating. As the noble Lord, Lord Wells-Pestell, made clear, to achieve that it would have needed to be put at £5…20 per week instead of £4…75. I certainly welcome the qualified assurance to maintain the value of child benefit which has been given by the Secretary of State, but it was a qualified assurance.
As the noble Lord, Lord Wells-Pestell, said, the position of anyone with children has been declining, as compared with the position of single people and childless couples, for some time and it is through child benefit that we must hope to remedy that situation. The increase in the child benefit premium for the first child of a single-parent family is welcome, but it helps only 4 per cent. of families in poverty, and single-parent families would be helped even more by a further increase in child benefit, because that would be paid for all children and not merely for the first.
This is an unhappy time for the social security system. I should certainly not want to use any exaggerated phrases, such as accusing the Government of dismantling the welfare state. Clearly that is not what is happening. But I believe very strongly that nibbling away at the welfare state (if I may mix my metaphors a little) will introduce an element of comparative hardship and unfairness, which I regret very much. It will cause benefits which were not adequate in the first place to be even less so, and will, regrettably, push more on to means-tested benefits.
Before I close, I should like to say a word about the supplementary benefit regulations. It is very important that the operation of these regulations should be monitored very carefully, and that there should be regular reports to both
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Houses. The main object, of course, is to reduce discretion. The burden on the supplementary benefit system, when 10 per cent. of the population rely on it, in some way or another, has become very great and made the exercise of discretion on the old pattern very difficult to sustain. But I should have preferred a major effort to reduce the numbers on supplementary benefit, rather than an effort to adapt supplementary benefit to the present situation. And by the abatement, and in other ways, the Government are actually increasing the numbers on supplementary benefit. Again, this is an argument for moving as soon as possible to a tax credit system which will take people off supplementary benefit.
Another object of the review of the supplementary benefit system is to simplify, but will the claimant really understand the situation any better as a result of these regulations? Perhaps the House will permit me just to quote one sentence from page 5 of the Supplementary Benefit (Requirements) Regulations. What it says is this:
"(2) Subject to paragraph (3), where a person to whom paragraph (1) applies is a claimant who satisfies the conditions of paragraph (2) of regulation 5 except that, contrary to sub-paragraph (b) of that paragraph, he shares responsibility for, or control of, the expenditure there referred to with another member of the same household, the weekly amount of his normal requirements applicable under paragraph 1 or 2 of Schedule I shall be increased by the difference between that amount and the corresponding rate (long-term or ordinary as the case may be) for householders divided by the number of persons in the household satisfying the condition of regulation 5(2)(c) who share responsibility or control."
I am not suggesting that that does not make perfectly good sense. But I am suggesting that it is not calculated to make the position immediately clear to the potential claimant. I hope, as the noble Lord, Lord Wells-Pestell, said, that the supplementary benefit handbook will be available in time for November, with an explanation of what this difficult wording actually means for the ordinary claimant.
The third object was to provide clearly defined rights. So far as that is done, it is of course welcome but a large amount of discretion still remains. This will be particularly so in the early stages when there is no case law to help guide the benefit officers. This will necessitate, in the early stages, notes of guidance for

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benefit officers and I should like to ask whether those notes of guidance will be published.
May I draw the attention of the House to two examples of the discretion which remains in these regulations. In the Supplementary Benefit (Requirements) Regulations, Regulation 9(4) allows a benefit officer to award a reasonable amount for board and lodging accommodation of "no more than suitable standard". That leaves much discretion and would appear to allow the benefit officer to award board and lodging to less than suitable standard if he should decide to do so. In any case, what is "suitable standard"? Secondly, Regulation 27(2) of the single payments regulations, which are not before us this afternoon but to which the noble Baroness referred, allows a benefit officer to make a payment for clothing which shall not exceed "prescribed amounts listed". The implication is that the benefit officer is free to make a payment which is less than the amount laid down.
I should like to put a question to the Government: where the regulations make benefit conditional on the benefit officer's opinion and the claimant appeals, has the claimant a full right of appeal against that opinion, with tribunals not bound by the benefit officer's opinion? Although much discretion will remain, particularly in the early days, tightening up the areas of discretion without increasing the scale rates would seem to mean that fewer people will be eligible for exceptional needs payments. Furthermore, no single payments will be made for those above supplementary benefit level. Can the Government confirm that those who would be on supplementary benefit but for the fact that they are in receipt of rent rebates or allowances will be eligible for exceptional needs payments?
During the discussion on the two Bills we spoke of home help and laundry costs: of the decision not to allow supplementary benefit to cover payments to local authorities for home helps and of the fact that 143,000 sick and disabled people will receive 30p per week less for their laundry costs. These are examples of the rough justice, I think it was called, which some people will suffer under the regulations. A heating allowance, under
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the Supplementary Benefit (Requirements) Regulations is stated to be available to those with serious physical illness. The introduction of the word "physical" is, I think, a departure and I wonder what the significance of the use of that word is. Does it cover, for example, mental illness, which might mean that a person was confined to his home and in need of assistance with heating? In conclusion, I would return to my first point. The regulations must be very carefully monitored to see how they operate in practice, and Parliament must watch this carefully and be prepared to make such adjustments as experience may suggest are essential.
4.24 p.m.
Lord BOYD-CARPENTER: My Lords, I have always been a great admirer of the noble Lord, Lord Wells-Pestell, and it is therefore agreeable to be able to begin by saying how wholeheartedly I agree with one of the things which he said in his speech. That was when he said that those who had had the good fortune to serve in the Department of Health and Social Security, or its predecessors, had inevitably a very high regard for the calibre and quality of the staff of that department. I should like very strongly to endorse that. I have always held the private view that with the possible exception of the Treasury, the staff of the social security departments are of the highest level of ability in the whole of Whitehall. With that quality, I hope that they will be able, as the noble Lord, Lord Wells-Pestell, suggested, to produce a clear, understandable handbook about these highly complex regulations. I have always regarded it as the mark of the real expert to be able to set out complex facts in clear and simple English. I hope that my noble friend will set her departmental staffs that task, because it is important that those involved should have a reasonable chance of understanding what their rights are.
My noble friend the Minister puzzled me on one small matter which perhaps she or her noble friend can clear up. She said that there was to be a further crop of regulations and that they would be laid in the next two months. As I understand it, it is not permissible to lay orders during the Recess. As I also understand it, we are due to rise this Friday, and even this hard-working House is not due back

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until 6th October. So perhaps somebody on the Government Bench could explain what exactly was meant by the indication that these further orders would be laid in the next two months.
May I also make a grumble which the noble Lord, Lord Wells-Pestell, will remember that I regularly made when he was the Minister concerned. That is in respect of the lump sum order. I was very sorry to see that it still excludes war pensioners as such. The noble Lord, Lord Wells-Pestell, will remember that for several years I urged on him and his colleagues that this exclusion was wrong. He explained to me, and subsequent ministers have explained to me, that war pensioners entitled to some additional allowance also get the £l0 Christmas bonus, the lump sum. But it still remains the position under this order that alone, really, among the beneficiaries of our system the man who has just a war pension does not receive this £10 bonus. The amount is not large, but the thought behind the allowance is a pleasant one: of showing that even government, even a social security department, has a human face. A small payment at Christmas has a touch of warmth and humanity about it, which is a nice thing to find, but I should like it to include those who have a war pension only.
The contrast is made the stronger by reason of the fact that the, as it were, opposite number to war pensioners—the industrial injury pensioners—receive it. This makes very pointed the exclusion of the war pensioner who has a war pension and nothing else. Comparisons in this field are odious, but I think that the House would probably agree with me that the war pensioner—the person actually disabled in the armed service of his country —is the most deserving type of all and the one to whom we owe the greatest and most direct debt.
Despite the steady obstruction and resistance of successive Ministers in successive Governments, I do hope that just a touch of humanity in this respect will one day break through. I can say to my noble friend that inevitably, in the course of nature, the number of war pensioners is diminishing and that the financial consequences of a concession here would not be of really earth-shaking quality. It would however, remedy what I still believe to be
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an anomaly and a blemish on the Christmas bonus system.
I have another doubt of a rather wider ranging character. I wonder whether the restriction of discretion in respect of supplementary benefit may not be going a little too far. I fully understand the argument—we had it on the Bill—for having a clear-cut system which everybody can understand, but under the older system the managers of the local social security offices (national assistance offices as they used to be called) had acquired an enormous experience and understanding of all the complexities of human need and the discretion which they exercised was almost always exercised with good sense as well as with humanity. I just express a doubt as to whether that discretion, despite the two examples quoted by the noble Lord, Lord Banks, has not been unduly restricted and I hope that one of my noble friends will indicate, when they reply, that this particular aspect of the changes is being watched very closely.
No ingenuity that the human mind is capable of—not even in the department—can conceivably foresee all the chances and changes that may afflict a few individuals in a population of 50 million people, and as a final reserve in a case of possible hardship from some unusual concatenation of circumstances a discretion in the hands of sensible, experienced local officials is quite a valuable safeguard and one that I suggest should not easily be forgone.
Having said that, I find myself in agreement with the general effect of these regulations. I fully understand and sympathise with the feelings which the noble Baroness herself expressed; namely, that this is not an easy time for social security administrators. It is much nicer to be a social security administrator at a time when the national income is rising, when reduced levels of taxation produce an increased yield and when there is more of the national wealth to share with all, including the least fortunate. That is a relatively happy situation. It is much less happy when on the whole the view of most responsible opinion is that all public expenditure, including social security expenditure, has to be restrained and therefore Ministers are driven to sort out which are the priorities which must be preserved at all costs and which are the directions in

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which benefits must be less than one would otherwise like them to be.
It is not a task that I think any of us envy the Ministers who have to handle it, and once again I wish to express dissent on the financial side of this from the views of the noble Lord, Lord Banks. I do not think the fact that the national insurance fund is, as he told us, self-financing really takes the argument very far. By whatever method the money used in benefits is raised, be it from the Exchequer contribution, be it from the employers' contribution—which is now very heavy and, to some extent, is a tax on employment—or the employees' contribution, in whatever way it is raised it is still a charge on national resources and therefore it is the duty of the Government not merely to say, "There is a certain amount of money in this particular till, therefore let us spend it", but to judge the expenditure in the general context of the position of the national economy and the national finances as a whole. As I understand it, that is what Her Majesty's Government are trying to do.
I would not say for one moment that they have got it 100 per cent. right. There are directions—and I have indicated two of them—where I have some doubts, but I think the House as a whole will feel that they have a most unenviable task and I believe a great many of us, at any rate, will feel, with all the difficulties that there are, that the Government have the balance about right. In any event, should these matters be taken (as I hope they will not be) to a Division, I should find no difficulty whatever in supporting my noble friend.
4.35 p.m.
Lord WALLACE of COSLANY: My Lords, first, may I apologise to the noble Lord, Lord Banks. I was completely unaware that the orchestration of the Opposition duets had been changed and that is why I leapt to the Box when in fact the noble Lord, Lord Banks, had the right to speak. As indicated by my noble friend Lord Wells-Pestell, I shall address my remarks to the lump sum payments, supplementary benefit resources and supplementary benefit requirements. So far as the Christmas bonus is concerned, I do not object to it as such, although it
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seems to me that it would be far better to provide an adequate retirement pension rather than to hand out something which is intended to classify the Government of the day as a benevolent Father Christmas, which in the light of the present Government's Scrooge—like approach to social security in the two new Acts makes it a somewhat cynical farce. It could be argued, with the present high rate of inflation, that the sum of £10 should be increased. That is a reasonable point; however, I do not intend to develop it but to be thankful for small mercies. I should, of course, declare an interest in that I shall receive my £10 pocket money in due course.
What I feel is disgraceful is that the Government have reduced the value of the £10 bonus by the delaying of the November increase by two weeks for, in the reason advanced by the Government, natural slippage. Actually, it is one week for slippage and one week to save money. Taking that into account and the rate of inflation, the value of the £10 bonus has been severely eroded, if not almost wiped out.
I now turn to the other two orders—requirements and resources. The Secretary of State, in a press release on 17th July, stated:
"These regulations "—
he was, of course, referring to all the regulations before the House at the moment—
set out claimants' rights fully and precisely for the first time and with the force of law".
"Fully and precisely "and" with the force of law"—legal jargon, certainly, and precisely within a legal framework means that plain language is forsaken. It is claimed that claimants will now know their rights. How on earth they will manage to understand these regulations is beyond me. I have had a terrific problem over the weekend in trying to understand them myself. The responsibility of interpretation will now rest with individual benefit officers under the new system. They themselves will need legal advisers to thread their way through regulations without the facility of wide discretion. I understand that a code will be available under the regulations. To those who want to assist the average person to claim their rights, it will be a costly and involved business. I believe

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that the set of regulations before the House costs £8 or more, and I understand that there are more to come.
We are told that leaflets in plain language will be available to help people to understand. The quantity and variety of these will he considerable if the Government do their job properly. Have they estimated the cost? It must be considerable. The Government claim that they are simplifying the whole system of supplementary benefit. In fact, by introducing masses of regulations which are difficult to comprehend they are making it more difficult for people to claim, reducing the number of claimants by so doing and thus saving more money, which basically is the object of the exercise.
Regulation 12(2), paragraphs (a), (b) and (c) and Regulation 13(2), (3) and (4) of the Supplementary Benefit (Requirements) Regulations remove from benefit people who are involved in a trade dispute. In their rush to hit trade unionists and please their supporters, the Government have overlooked the harsh anomalies that their actions will cause. Take the case of a wife who is working, perhaps part-time, and whose husband is sick or unemployed and in receipt of the heating allowance. If the wife is involved in a strike, but is not necessarily on strike herself, the allowance will be stopped. This is one example, but others could arise. This is harsh to a degree. Perhaps the Government might deal with such anomalies. It is possible that we shall have to face more regulations amending the present regulations. This, I am sure, will be the pattern, creating further complexities on top of the complexities already existing in the present regulations.
Let us take another example of a mother visiting a sick child in hospital, where the child has been for a long time, and the mother needs help with fares to the hospital, or the frail and elderly husband or wife visiting a sick spouse. The regulations have been redrawn in a supposed effort to clarify which people can claim a contribution towards expenses. I quote from Schedule 3, Part I, the amended printed version, 16, Hospital fares:
"Person, A, who regularly visits another person, B, who is a patient in any hospital or similar institution where—

(a) A and B are not members of the same assessment unit but—
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(i) were members of the same household prior to the hospitalisation of B; or

(ii) are close relatives;

(b) either—

(i) A and B are partners, or,

(ii) A is a dependant of a relevant person who is either B or B's partner,

and B has been a patient for a continuous period of not more than eight weeks; "
Then I turn to col. (2), Weekly amount:
"… an amount determined in accordance with subparagraph (a) in this column less the whole of the difference, except for an amount equal to 20 per cent. of the long-term rate for householders, between the long-term or ordinary rate for couples applicable to B or B's partner and the corresponding rate (long-term or ordinary as the case may be) for householders."
Well, this is supposed to make it possible for the frail and elderly to realise what their rights are when visiting someone in hospital. All I can say is that it is as clear as mud, and if noble Lords can understand it they are better men than I am.
The resources regulations also set a cash resources limit of £2,000, not a large sum these days. Any total savings over that figure cuts out entitlement. This goes hard for the unemployed man who has been careful and thrifty over the years as against another in the same former job but who over the years has not bothered to save. Not a new story on supplementary benefit, but why penalise the thrifty'? Overnight some 7,000 pensioners will lose their supplementary benefit because they have capital of over £2,000. As we have been told, the figure of £2,000 was first proposed in the 1978 report on social assistance. Surely the effect of inflation should have been taken into account. A figure of £3,000 or more would be fairer.
I would also draw the attention of the House to Regulation 4(4) of the resources regulations:
"Where a person performs an unpaid service I'm another person who has the means to pay for that service and for which in the ordinary course he would pay, an amount calculated by reference to comparable employment and the means of that other person may be treated as if it were actually paid to and possessed by the first-mentioned person."
I had better explain this; I will try to elucidate it for the benefit of your Lordships. This means if an elderly neighbour on supplementary benefit of another pensioner or sick person decides to help his friend by maintaining the other

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person's garden, he can by this act of kindness reduce or stop the neighbour's supplementary benefit, because it could be argued that the other person had the means to pay for the service although it was freely given without charge. Although I agree that something like this did exist under the old system, to read it set out in cold print is the absolute limit. Of course, in spite of this ridiculous regulation such acts of neighbourly kindness will continue undetected, but an offence is being committed against a regulation hacked by the force of law. What an opportunity for the nosey vindictive type of neighbour that does exist. Why not withdraw this heartless regulation denying Christian charity and penalising an act of good neighbourliness.
These orders are the beginning of an orgy of regulations. It is impossible to regulate for human situations of distress in a completely legal form. Discretion within set reasonable limits is the more humane way. The Government will not get rid either of wild and unfounded charges of large-scale abuse of social security. Their supporters in the past in political campaigns have spread the poison. Abuse must be dealt with, but the main mass of people in receipt of supplementary benefit are genuine cases of need. I would ask: Are the Government still continuing their policy of encouraging snoopers?
These regulations do not give rights; they give the anxieties of confusion and in many cases reduction of help. We must remember that the people who apply for supplementary benefit are mainly those who have suffered sudden misfortune or are facing up to real poverty, some for the first time. Many are in a desperate state of despair. Many are proud and pride has to be swallowed to apply for benefit. This particularly applies to the elderly, who in many cases are reluctant and have to be persuaded to apply for help as a right. The complexities of these orders will not help those public spirited people who help, advise and persuade. Certainly it will not help those who are sensitive over applying for their rights. Discretionary powers backed by reasonable guidelines are the answer—not regulations backed by the force of law.
Baroness YOUNG: My Lords, I do not want to interrupt anybody, because I know there are a number of noble Lords who want to speak, but an enormous number of questions have been asked, and I wonder whether it would be for the convenience of the House if some of them were answered at this point before my noble friend Lord Cullen winds up at the end. If this is agreeable, I suggest that my noble friend Lord Sandys should speak now, and then the noble Lord on the Liberal Benches and any other noble Lord who wants to speak. Otherwise, we are accumulating rather a lot of questions to be answered at the end.
Lord SANDYS: My Lords, perhaps I may be allowed to reply to a number of questions put to me by the noble Lord, Lord Wells-Pestell. Of course, the House will be familiar, during the course of both the Social Security (No. 1) and the Social Security (No. 2) Bills, with the exaggerated language which the noble Lord used on those occasions. I recollect that he cast himself in the role of Guy Fawkes on one occasion, and I think on another echoed the views of his right honourable and honourable friends in another place in Standing Committee who cast themselves in the roles of Butch Cassidy and the Sundance Kid. I believe that this is perhaps his true role, because the unhappy affliction of those two wellknown personalities was that they destroyed the very thing which was their aim and object.
If I may turn my attention specifically to the noble Lord's questions, he asked when there would be an announcement over the chairman of the Social Security Advisory Committee. May I tell him that my right honourable friend the Secretary of State hopes to be in a position to announce the name of the chairman of the Social Security Advisory Committee before the House rises for the Summer Recess. As regards the handbook on supplementary benefits, I should like to advise the noble Lord that there will be such a handbook and a wide range of explanatory leaflets. I think that the noble Lord and his noble friends have been very much concerned about that. The aim is to make the leaflets and the handbook as clear and as helpful as possible.

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As regards child benefit, upon which the noble Lord dwelt at some length, I remind him of the words of my noble friend Lady Young when she said, when referring to the increases:
"These increases bring the total annual expenditure on child benefit to £3,300 million a year".
The increase in child benefit will be, as she announced, 75p a week for each child in November 1980, and that will give a 20 per cent. increase in the child benefit addition altogether. That is a very substantial amount, but it is less than the Government hoped they would be able to make it and we recognise that it is less than the sum needed to bring it up to its original purchasing power.
The noble Lord also asked whether the Treasury had made an error of 2 per cent. I can assure him that there is no reason to expect that there is an error of that amount. We have come a great deal closer to the November date since this matter was raised in another place. I can assure the noble Lord that, so far as the Government are concerned, and to the best belief of my honourable and right honourable friends, we are on target.
The question of supplementary benefit was another matter raised by the noble Lord, Lord Wells-Pestell, and, I think, by my noble friend Lord Boyd-Carpenter. I draw your Lordships' attention to the press release, a copy of which I think my noble friend placed in his hands, dated 17th July. On page III there is a very useful indication of gainers and losers. I shall not read it all out, but the indications are as follows. We believe that the position is fragmented, but it has been proved to be somewhat better than was forecast at one time. I shall refer to one small part. It says that the latest information, from which we can estimate the numbers of claimants who will gain or lose by the various changes being made, relates to the end of 1978. Details of these estimates were given in a written reply to the honourable Member for Perry Barr on 7th December 1979, volume 976, column 371. Some people, of course, will both gain and lose and a tentative estimate is that about three-quarters of a million people will gain, that 1¾ million people will lose and that half a million will be unaffected. That is, to the best of our belief, the present position. I hope that the noble Lord
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has had the opportunity to study those figures.
Lord WELLS-PESTELL: My Lords, before the noble Lord, Lord Sandys, sits down, am I correct in thinking that what he is saying is that, while he may well disagree with my figure of 2 million people being likely to suffer, he acknowledges that while some will gain 1¾ million people will suffer? Is that what he is saying?
Lord SANDYS: My Lords, that is perfectly true to the best of our belief, but it may be only at the margin.
Earl GREY: My Lords, we on these Benches welcome any provisions made for pensioners, but we are very disappointed that the Christmas bonus has not been increased in spite of inflation and of what the noble Lord, Lord Cullen of Ashbourne, said in your Lordships' House last year, that the Government have the power to increase the bonus if it is considered appropriate. Would the Minister agree that there is justification this year for such an increase? Each year, and especially this year, the value of the bonus decreases. Is it not time that the bonus was indexed to bring it in line with real values? The rate has remained fixed through three Governments. We feel that the bonus is no substitute for a realistic basic pension.
4.56 p.m.
Baroness PHILLIPS: My Lords, I wish to intervene on two very short points and if I do not receive an answer immediately I shall quite understand. The first concerns the younger widow. I have searched all the regulations very carefully and I cannot find any reference to the increase other than the statement on, I think, page 10 which refers to the widow's pension and to the increase to which the noble Minister referred. It then says something about 30 per cent. of the sum being the lower permanent rate. I worked out 30 per cent. of £27.50 and it seems to me that it is only about £9. The Minister will remember that the younger widow is the one who comes in under 50. She receives a lower rate pro rata—if she is 40 she receives a very low sum, if she is 41 she receives a little more and so on. But, unlike with other pensions, she does not receive the full

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pension when she is 50: she does not receive the full pension until she receives the retirement pension. So, it is important to know exactly what she will receive.
The other point concerns the death grant on page 6. While searching for information about the widows I came across another matter. It is curious that the death grant payment is related to men of a higher age than women. Surely, if the man dies there will be more need for the money than if the woman dies. Generally speaking, the man will have been the breadwinner. Surely the Government could not have deliberately put the age higher in order not to pay out so much? I am sure that they could not have thought of that. It is only £15 anyway, so it will not go very far.
I searched through the other leaflet which dealt with married women and widows hoping to find information about the younger widow, but instead I found a curious paragraph which related to the interrelated benefits. Paragraph 2(2) says that hitherto the specification was that the woman was married to the man when he died. But now apparently there will be an insertion which says that
"and since his death she has not remarried…"
I am not clear whether that means that she loses only the earnings-related or the whole pension. I think that it behoves us to search these regulations very carefully because as these provisions are not in the Act but in regulations, it seems only too easy that certain rather curious facets of this matter might slip through.
5 p.m.
Lord CULLEN of ASH BOURNE: My Lords, we have had a very interesting debate. Social security is always a complicated subject and no one ever takes part in these debates unless he or she is very expert. Personally, I have found it interesting. I propose to be as short as possible and to answer as best I can such questions as have been asked of me.
The noble Lord, Lord Wells-Pestell, mentioned one point—I am not sure whether we have dealt with it—about the increase in child benefit.—It is now equivalent to just over 11 per cent. a year,
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which is the same rate as the increase in the married tax allowance. I did not know whether the noble Lord was quite clear on that. The improvements in the premium for one-parent families and in family income supplement concentrate resources on the poorest working families. Overall, the Government have improved family support as much as they feel able to at this stage.
The noble Lord, Lord Banks, asked a number of questions. He asked about benefit officers' opinion. I am advised that a benefit officer's opinion will be appealable and will not bind the appellate authorities. The noble Lord referred to monitoring, and I can assure noble Lords that my right honourable friend will be keeping a close eye on the operation of the new regulations by statistics and by internal and external research.
My noble friend Lord Boyd-Carpenter asked about the orders which will be laid in the next two months. I am told that Negative Resolution orders may be laid during the Recess. They can, of course, be prayed against when the House resumes. I hope that that satisfies my noble friend.
Lord BOYD-CARPENTER: My Lords, if my noble friend will allow me, is the House to understand that it will be only negative procedure orders which will be laid in the group referred to by his noble friend the Minister?
Lord CULLEN of ASHBOURNE: My Lords, I understand that that is so. The noble Lord, Lord Banks, spoke of the complexity of language in the regulations. The wording of the regulations is inevitably difficult, but I can assure the House that there will be a new and fuller handbook, together with the usual leaflets, plus a new one on single payments. Therefore, it will not be necessary for claimants to have to try to understand the complicated language of the regulations.
The noble Lord also referred to the Notes of Guidance to Benefit Officers. This guidance will be issued by the chief benefit officer. He, like all benefit officers, is an independant authority, and it will be for him to decide whether and what to publish. Case law developed by commissioners will, as now, be published.

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The noble Lord referred to heating. These allowances will be payable solely on grounds of physical disability or illness. This follows the current commission policy, which is to give extra help where extra heating is needed for reasons of physical frailty or handicap. The noble Lord also spoke about family income supplement. Improvements in F1S ought not to be held back because of the concern about the poverty trap. I agree that improvements may mean that more families are affected, but for an individual family the position is not worsened in practice because FIS continues for the year regardless of changes in circumstances; so incentive to work is not destroyed and families are better off.
The noble Lord spoke about rent and rate rebates. Where a person is not claiming benefit but would be entitled if he made a claim in the proper manner, he will be able to get a single payment. If he is receiving housing rebates, those will be taken into account. So whether he is entitled to supplementary benefit will depend on his needs and his other resources. Several noble Lords have spoken about the Christmas bonus, including my noble friend Lord Boyd-Carpenter, who has spoken on this subject before now. In fact, I am rather chary about replying to my noble friend. He put down a Written Question on the subject in June 1979, which I answered to the best of my ability, but he has returned to the attack once more and I do not know whether this reply will help him; so I think that I should offer to write to him more fully than I can reply at this moment.
My reply is that war disablement pensioners are not treated less beneficially than industrial injuries pensioners. Broadly, they have to satisfy the same conditions—the receipt of a qualifying benefit. The qualifying benefits include unemployability supplement or constant attendance allowance under the War Pensions and Industrial Injuries Schemes. War pensioners have preference, in that they can receive the bonus if they are over pension age and retired but not in receipt of a qualifying pension.
The noble Earl, Lord Grey, suggested that it was high time the Christmas bonus was increased. This is a matter which comes up frequently, and I can remember the noble Lord, Lord Wells-Pestell, re-
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plying to this on a number of occasions in the past. I can only say that it is not presently planned to do so. The noble Lord, Lord Wallace of Coslany, referred to strikers and the harsh provisions. These regulations simply reproduce the policy as it has been operated for many years, including periods when the noble Lord's party has been in power. The noble Lord also referred to notional resources. I must point out to him that the provision to which he drew attention is permissive. Of course, it is not directed against neighbourly kindness.
Lord WALLACE of COSLANY: My Lords, with respect to the noble Lord, I do not quite accept that. In point of fact there is a deliberate reduction this time. I think that the noble Lord is completely wrong.
Lord CULLEN of ASHBOURNE: My Lords, as a matter of fact we are in some difficulty over the acoustics in this House, and I have had some difficulty in hearing what the noble Lord said. If he would like to make his point on this again, I should be very glad to try to reply to it.
Lord WALLACE of COSLANY: My Lords, I shall have to remember what I said for I passed my notes to Hansard because I have some sympathy with them. The point is that if a husband is ill at home and is in receipt of a heating allowance, if the wife is out at work—either whole or part-time—and she becomes involved in a strike (she may not be actually involved as a striker), the allowance would be withdrawn on those grounds.
Lord CULLEN of ASHBOURNE: My Lords, somehow I think it would be better for us to read what the noble Lord said in Hansard and then I shall write to him. Referring to what the noble Lord mentioned as regards notional resources, I must point out to him that the provision to which he drew attention is permissive. Of course it is not directed against neighbourly kindness but against work which is in the nature of regular but unpaid employment—it is a very necessary safeguard. I feel that the noble Lord probably asked a number of other questions which we did not pick up. I promise to write to him, having read Hansard tomorrow.

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The noble Baroness, Lady Phillips, asked about younger widows. The widow under 40 without children does not get a continuing pension. This has always been the position in the national insurance scheme.
Baroness PHILLIPS: My Lords, it is between 40 and 50 that I am interested in.
Lord CULLEN of ASHBOURNE: My Lords, again I had probably better write to the noble Baroness. I know that there is a differing rate between 40 and 50 and it changes as you go up from 40 to 50, but again I am not sure that I have quite got the question. I think the noble Baroness also mentioned the death grant. I am afraid I shall have to write to the noble Baroness on that too because I cannot read the memorandum I have here. I feel that I have quite a lot of other questions to answer, which I shall do, if I may, by letter.
Baroness YOUNG: My Lords, I am not quite sure of the procedure at this point, but I felt that it might be for the convenience of the House if I move one by one the regulations in case there are further points anyone wishes to raise on them. In moving the first regulation I should like to mention the work that has been done by the Joint Committee on Statutory Instruments in reviewing each order and reporting on it. In the case of these orders they drew special attention only to the No. 7 Supplementary Benefit Requirements Regulations, but I know that the committee has done a great deal of valuable work and I am sure that it would be the wish of us all that this should be placed on the record. I beg to move the first order, the Social Security Benefits (Up-rating) Order 1980, standing in my name on the Order Paper.
On Question, Motion agreed to.

FAMILY INCOME SUPPLEMENTS (COMPUTATION) REGULATIONS 1980
5.13 p.m.
Baroness YOUNG: My Lords, I beg to move the Family Income Supplements (Computation) Regulations 1980.
Moved, That the draft regulations laid before the House on 17th July be approved.—(Baroness Young.)
On Question, Motion agreed to.

CHILD BENEFIT (UP-RATING) REGULATIONS 1980
Baroness YOUNG: My Lords, I beg to move the Child Benefit (Up-Rating) Regulations 1980.
Moved, That the draft regulations laid before the House on 17th July be approved.—(Baroness Young.)
On Question, Motion agreed to.

PENSIONERS' LUMP SUM PAYMENTS ORDER 1980
Baroness YOUNG: My Lords, I beg to move the Pensioners' Lump Sum Payments Order 1980.
Moved, That the draft order laid before the House on 17th July be approved. —(Baroness Young.)
On Question, Motion agreed to.

SOCIAL SECURITY (BENENFIT) (MARRIED WOMEN AND WIDOWS SPECIAL PROVISIONS) AMENDMENT REGULATIONS 1980
Baroness YOUNG: My Lords, I beg to move the Social Security (Benefit) (Married Women and Widows Special Provisions) Amendment Regulations 1980.
Moved, That the draft regulations laid I before the House on 17th July be approved. —(Baroness Young.)
On Question, Motion agreed to.

SUPPLEMENTARY BENEFIT (RESOURCES) REGULATIONS 1980
Baroness YOUNG: My Lords, I beg to move the Supplementary Benefit (Resources) Regulations 1980.
Moved, That the draft regulations laid before the House on 17th July be approved. —(Baroness Young.)
On Question, Motion agreed to.

SUPPLEMENTARY BENEFIT (REQUIREMENTS) REGULATIONS 1980
Baroness YOUNG: My Lords, I beg to move the Supplementary Benefit (Requirements) Regulations 1980.
Moved, That the draft regulations laid before the House on 17th July be approved. —(Baroness Young.)
On Question, Motion agreed to.

ANTI-COMPETITIVE PRACTICES (EXCLUSIONS) ORDER 1980
5.14 p.m.
Lord LYELL Lord LYELL rose to move, That the order laid before the House on 21st July be approved.
The noble Lord said: My Lords, I beg to move that this order be approved. Most of the provisions of the order will, I believe, be generally welcome to your Lordships. Many of them are indeed a direct result of assurances given by the Government during the passage of the Competition Bill through your Lordships' House. A number of your Lordships will be able to see that their own representations have indeed borne fruit. But I hope that they and the rest of the House will bear with me while I explain some of what we see as the salient points in the order.
The order excludes certain courses of conduct from being considered anticompetitive practices under the provisions of the Competition Act. The Competition Act provides wide-ranging powers for the investigation and control of restrictions of competition. It imposes no general prohibition on any action and need cause no general concern to any particular section of industry. The desirability of any investigation can be considered on a case-by-case basis, both by the Director General of Fair Trading, who has the power of investigation, and if necessary by the Secretary of State, who has a power of veto. The question therefore arises of whether there is any real need to exclude in advance the possibility of action in any particular area. Certainly such exclusions should not be made without good reason.
Nevertheless, it is the view of the Government that there is a small number of areas where, on balance, it would be desirable to indicate clearly in advance that matters will not be subject to the procedures in the Act. This will serve the dual purpose of removing uncertainty and anxiety among the firms concerned themselves, and of enabling the Office of Fair Trading to concentrate their efforts where they are most likely to be rewarding.
Undoubtedly the most important of the exclusions is the provision to exclude the conduct of small firms. The rationale behind this provision is two-fold: first, it is likely that an investigation by the Director General, and especially a fuller investigation by the Monopolies and Mergers Commission, would impose a serious strain on the management resources of a small firm. Second, there must be a presumption that a relatively small firm would be unlikely to enjoy a sufficient degree of dominance in any particular market to be able effectively to restrict competition. As to the precise level of the exemption threshold, my right honourable friend the Secretary of State indicated during the passage of the Bill in another place that he had it in mind to base the exemption on an annual turnover of less than £5 million. This figure is adopted in the order.
Any such threshold is of course to some extent arbitrary, and we shall keep the particular figure of £5 million under review in case it proves either too high or too low. However, it is important to note that the threshold is not an absolute barrier. As my right honourable friend also indicated, the exemption based on turnover will not apply if it can be demonstrated that the firm concerned enjoys a quarter or more of a relevant market in the United Kingdom or part of the United Kingdom—in other words, a monopoly situation as defined in the Fair Trading Act. We think that it will be exceptional for a small firm to be responsible for a serious restriction of competition, but, if in such an exceptional case the market share condition is met, the conduct of the firm will be open to investigation.
The House will be pleased to hear that I do not intend to go in detail through all the provisions for the definition of turn-

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over, but there are two points however worthy of mention. First, where a company is a member of a group, the turnover and market share of the group as a whole will count towards the relevant turnover and market share of the group thresholds. We recognise that a firm within a group may sometimes enjoy a substantial degree of independence, but as a practical step we are bound to regard a group as a single economic entity. Secondly, in formulating the definition of turnover we have tried to ensure as far as possible that the position of a firm under the order can be established from its published accounts and reports, without any further inquiry. In general, the basis for the assessment of turnover will be the amount charged for the supply of goods and services in the United Kingdom during the most recent completed accounting period. This is what the noble Lord, Lord Bruce, and I used to call a financial year, but it has been changed recently as a result of companies legislation in the past three or four years.
There could however be firms, such as property companies, which derive a substantial income from rents or other sources distinct from turnover under this general definition. Such companies could nevertheless be engaged in anticompetitive practices within the meaning of the Act, and it would be wrong to exclude them from investigation on a mere technicality. In these cases, income from activites other than the supply of goods and services will be included in turnover for the purposes of the order.
The position of local authorities should be mentioned. The Act makes special provision for the investigation of anticompetitive practices in local authority procurement. It would clearly be inappropriate for the possibility of investigation to be affected by the quite extraneous consideration of the authority's turnover from commercial activities, which in general will be very limited. Local authorities will therefore not be eligible for the turnover exemption. However, we have made a special provision to exclude investigation of the smallest local authorities, the parish and community councils.
In mentioning local authority procurement, I take the opportunity to give further guidance on the scope for investiga-
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tion in this field. The order is designed to allow the investigation of local authority procurement practices, other than those of community and parish councils, if it appears that these may have the effect of restricting competition. We have however made it clear that we have no intention of undermining the widely recognised practice of selective competitive tendering which offers very real benefits both to local authorities and to their contractors. Where procedures are operated competitively within a framework accepted by the Government, an investigation would not be appropriate and the Government would expect the Office of Fair Trading to take this into account when considering any possible investigations.
The fullest statement of relevant principles for tendering procedures is set out in Chapter 8 of the Department of the Environment's Code of Procedures for Local Authority Housebuilding. This applies to the particular field of house-building in England and Wales, but its main principles are relevant to local authority procurement in general. Many relevant principles are also contained in the Code of Procedure for Single Stage Selective Tendering of the National Joint Consultative Committee for Building, which applies throughout the United Kingdom. Procedures applicable to contracts for supplies as well as works are contained in the Model Standing Orders—Contracts issued by the Ministry of Housing and Local Government for the assistance of local authorities in England and Wales. Procedures offering scope for competition within the guidelines set out in these documents so that all suitable and eligible firms have equal tendering opportunities, would not be suitable for investigation under the Act and it would be open to the Government to use their powers of veto if such an investigation were proposed.
I come to the exclusions listed in Schedule 1 of the order. Unlike the general exemption for small firms, the exclusions in Schedule I relate to specific activities or categories of persons. I have mentioned the special provision for parish and community councils, and I will briefly take the House through other provisions of the schedule, but first I will make a general remark. Those of your Lordships who are familiar with existing competition legislation will see that the

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exclusions in the schedule bear some relation to the matters excluded from the legislation on restrictive trade practices. The exclusions in the present order are more limited, and there is a reason for this.
The restrictive trade practices legislation imposes automatic requirements to register restrictive agreements and applies a strong presumption that such agreements are against the public interest. Where any particular category of agreements seems in general likely to be beneficial, there is therefore a good case for excluding them in advance from the rigours of the system. The approach of the Competition Act is quite different. It provides only for selective investigation at the discretion of the director general. The case for block exemptions in advance is, in general, weaker, and there are therefore a number of areas where exemptions under restrictive trade practices legislation have not been repeated in the present order. This does not mean that such areas are a prime target for investigation under the Act; only that investigation is not ruled out. There are indeed areas where we believe investigation would not in general be desirable, but where occasional abuses may arise, and these can be examined individually.
Schedule 1 provides for block exemptions only in a small number of cases where the absence of an exemption, and the consequent theoretical possibility of an investigation, could in itself cause damaging uncertainty or misunderstanding and misrepresentation of Government policy. In proceedings on the Competition Bill in the House earlier this year we mentioned in particular the possibility of complications with international questions of jurisdiction. It will be seen that the Schedule includes exemptions for matters concerning international shipping and civil aviation services. It was also represented to us—in particular by my noble friend Lord Mottistone—that conditions on the supply of goods in the United Kingdom which relate solely to their subsequent supply outside the United Kingdom would not be a suitable subject for investigation. On reflection, we accept that, and to avoid uncertainty on this point and the possible distraction of the Office of Fair Trading by comp-plaints on such matters, we have provided an explicit exemption.
We were also asked by my noble friend Lord Teviot for assurances that agreements entered into by bus operators in pursuance of provisions of the Transport Acts would not be undermined by action under the Competition Act. Paragraph 2 of the schedule ensures this. We were also asked to confirm that the internal affairs of agricultural co-operatives should not he investigated, even though technically they may involve a restriction of competition. Paragraph 7 of the schedule provides for this, but I would emphasise that it does not exclude investigation of anticompetitive behaviour of an agricultural co-operative as a whole vis-à-vis other suppliers in the market. Paragraphs 5 and 6 provide for the exemption of certain agreements between the Government and financial institutions which are necessary for the operation of the Government's monetary and financial policies. Perhaps there would be no serious doubt on that point, but on such an important matter we thought an explicit provision was desirable.
In conclusion, I emphasise again that the exclusions provided for in the order are limited. They are not immutable and if it should emerge that significant anti-competitive practices are being excluded from consideration as a result of the order, we shall review the need for the exclusion in question. In general, the aim of the exclusions is not to prevent investigation in areas which would otherwise be major targets for action, but on the contrary, to make explicit some limits to the scope of investigation as envisaged from the outset. I would therefore not wish to overstate the practical significance of the order, hut I believe it will provide greater assurance and remove misunderstandings about the legislation in the areas to which it applies. I beg to move.
Moved, That the order laid before the House on 21st July be approved.—(Lord Lyell.)
5.29 p.m.
Lord PONSONBY of SHULBREDE: My Lords, I thank the noble Lord, Lord Lyell, for explaining the order and for going through it in considerable detail. I am sorry that the noble Baroness, Lady Hornsby-Smith, is not in her place because I know she would have been

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pleased to learn that the order has taken the form of excluding small businesses from the effects of the Competition Act. In explaining the order the noble Lord said that the figure of a £5 million turnover was purely arbitrary. That would certainly seem to be the case, and indeed one wonders why a figure so large as £5 million is set as the limit at which the exclusion applies. Elsewhere, a small firm or a small business has been defined as a firm with, say, 200 employees, and one would envisage that a firm of that nature would probably have a turnover of £2 million; that is to say, considerably less than is proposed in the order.
The order also refers to one-quarter of the market domination, and this, too, is arbitrary. Why should one-quarter be taken, instead of one-fifth or one-sixth? The Government should try to justify these figures and proportions beyond saying that they are purely arbitrary, and they should say why they have come down at these two particular levels. In moving the order the noble Lord said that if the Government find that the levels are too high or too low, they will adjust them, but certainly at first sight it would appear to me that the purpose of the Act was that firms or businesses of a size smaller than is now proposed should be brought within its ambit. I should be pleased to have any comments which the noble Lord may care to make in justification of those two very important aspects of the order.
Lord STANLEY of ALDERLEY: My Lords, since during the passage of the Act I requested that the Government look at certain matters regarding agricultural co-operatives, I should like to say a few words about Schedule 1, paragraph 7 of the order. As I understand it, this paragraph excludes those organisations, such as agricultural co-operatives, that were previously excluded by Section 33 of the Restrictive Trade Practices Act 1976 from being examined by the Director General of Fair Trading. Again as I understand it, this paragraph excludes the Director General from looking at the internal affairs of agricultural co-operatives and not, as my noble friend Lord Lyell said, the external affairs and practices of a co-operative as a whole with outside traders. Believe it or not, that is exactly
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what I asked for during the passage of the Bill, though I believe that my noble friend Lord Mottistone thought that I was asking also for the external affairs not to be subject to examination by the Director General of Fair Trading. Of course had I been offered that, I might in my weakness have been prepared to accept it, but I did not actually ask for it. I also wish to welcome the £5 million limit, or top limit —call it what you will—because this will exclude the majority of farmers from being investigated by the Director General.
Finally, I believe that the wording of the paragraph is correct, but if it is not, my noble friend Lord Lyell need not worry too much because I promise him that I shall be hot-foot to the relevant authorities to complain. I wish to thank the Government for understanding my point and to assure them that I continually pray that they will go on so doing, in particular on this Wednesday.
5.34 p.m.
Baroness SEEAR: My Lords, I take it that the £5 million limitation has been chosen because the Government assume that at that figure it would be very unlikely that an organisation can dominate the market, and that therefore ordinary competitive processes will work. While I imagine that in most cases that would be true, there is the question—which think arose when the Bill was going through the House—of what is virtually a monopoly, or indeed completely a monopoly, in a local area, although the actual turnover may be very low and indeed would be much lower than the £5 million which appears in the order. The Minister said something about this when he was going through the order just now, but it would be helpful, if only for the record, if he would tell us a little more about the situation where there is a monopoly in a local area, albeit involving a small turnover, yet none the less a monopoly. Such would be quite possible, for example, with the provision of a service. If it seemed to some people that that monopoly was being exploited, how could action be taken with the present provisions to have that checked?
Lord BRUCE of DONINGTON: My Lords, with your Lordships' permission I wish to ask one question, which is perhaps technical. I observe that through-

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out the order the term "person" has been used, but this term does not appear among the definitions given. Sometimes misunderstandings arise regarding this. I need remind the noble Lord opposite only of the instances in which the word "person" appears in the income tax Acts and in the Finance Acts, with a variety of definitions given at various places, and this has been known to give some cause for confusion. I do not know whether the noble Lord would care to comment on this; as I say, it is a purely technical question. There may he a reason why the term was used but thereafter not incorporated in the definitions, and perhaps the noble Lord will be kind enough to explain.
Another point occurred to me while reading through the exclusion provisions. Paragraph 5(1) of Schedule 1 refers to:
"Any course of conduct required or envisaged by any agreement entered into between the Treasury (or the Treasury and the Secretary of State) and building societies which relates solely to the raising of funds or the making of loans".
I am a little at a loss to see why that should have been included among the exclusions. The noble Lord may recall that the Wilson Committee, which recently reported, made recommendations to the effect that building societies ought to be subject to the normal laws of competition, and I understand that as a matter of principle competition is a belief to which noble Lords opposite are supremely addicted. Bearing in mind the very weighty conclusions reached by the Wilson Committee, I wonder why the Government should have decided to exclude building societies.
Lord LYELL: My Lords, I should like to thank all noble Lords who have given the order what I believe was in general a very charming welcome. Perhaps I may attempt to answer some of the questions—I was going to say Peer by Peer, but perhaps it would be more suitable if I dealt with the points in the order in which noble Lords spoke. The noble Lord, Lord Ponsonby of Shulbrede, asked me first about the £5 million turnover. The noble Baroness also mentioned this point, and I think that it was also raised in passing by my noble friend Lord Stanley of Alderley. The Government believe that the £5 million turnover threshold figure will exclude the
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small, and even what we would call the small to medium size, businesses. I take on board the point that the noble Lord, Lord Ponsonby, made, and no doubt other Members of your Lordships' House could instance relevant companies whose turnover figures might differ even where there are the same number of employees in each case. Some such firms might be more capital intensive, while others might be more labour intensive.
We believe that this is a significant first attempt to find a threshold level below which there will not he any automatic investigations by the director general. If it is found that a firm which has a turnover below this level is restricting competition in any specialised or local market, it will still be possible to investigate the activities of this firm, but the burden of proof in this particular case will be on the director general to establish that the firm has a relevant and substantial market share. We think, though, that this last provision, in conjunction with the £5 million threshold, strikes a reasonable balance between the need to protect smaller firms from unnecessary and tedious intervention and, indeed, the need to control genuine restrictions of competition. The actual level will of course be amended if it is seen to be too high or too low. The noble Lord, Lord Ponsonby, may recall—he will certainly find it in Hansard tomorrow, and I hope he heard me as I went through this order earlier—that I said that this threshold was not an absolute barrier one way or the other: it may be raised, it may be lowered, as the Government see the need to deal with competitive legislation.
I should like to thank my noble friend Lord Stanley for his words of comfort. I hope I got the point right about relations outwith the agricultural co-operatives. I was pleased he welcomed the limit of £5 million, and I was interested that he thought this was a relevant level for agricultural co-operatives. Certainly from my own knowledge of farming on a much smaller scale I am fascinated, for it will be a number of years yet before anything we do in my part of the world will be on this level.
Lord STANLEY of ALDERLEY: My Lords, may I interrupt my noble friend to explain something? I welcomed it on

1315
behalf of farmers, and I welcomed it also on behalf of agricultural co-operatives, not with the £5 million limit but on its special basis, because a lot of agricultural co-operatives, as he will appreciate, are well over £5 million. My own is.
Lord LYELL: I take the point, my Lords. Lastly, so far as my noble friend Lord Stanley is concerned, I hope we have the wording correct. There is always a point with the noble Lord and with others of your Lordships who take particular care over the drafting. The noble Baroness, Lady Seear, made the point about the £5 million threshold for me because she thought it was relevant. She had one other query so far as I recall, and that was to do with local monopolies and the level of what might or might not be described as a local monopoly.
Baroness SEEAR: My Lords, it was not the level so much as the difficulty of getting at it. I can envisage a situation in which a local monopoly is going on, and in practice it might be very difficult to bring it to book. That is what I am after.
Lord LYELL: My Lords, the answer, which I hope might satisfy the noble Baroness, is that where we find that there is what is termed a monopoly in a local area—and this is over 25 per cent.; I shall come to this later—the anticompetitive behaviour of the firm, which the noble Baroness finds might be blatant, even, can be and indeed will be investigated even if the firm is below the £5 million limit. But we believe that there are adequate powers in the Act for such anti-competitive behaviour to be investigated. We believe that the director general already has powers to investigate. Of course, such behaviour has to be brought to his notice, but we do not think that there is any special problem as far as local monopoly is concerned.
I do not think I answered the noble Lord, Lord Ponsonby, on his figure of 25 per cent., and why we had taken this particular figure. We understand that the figure of 25 per cent. for a market share is not purely arbitrary. It is the figure which has been adopted all the way through in legislation on monopolies and on restrictive practices. This is the initial benchmark for a significant market
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dominance in that legislation, and we regard that as a sufficient starting point for the Competition Act. That is the reason why 25 per cent. has been taken as the level in the order that I am putting before your Lordships today.
The noble Lord, Lord Bruce, tempts me, as indeed he always does when he wishes to look into drafting and accountancy points. He tempts me with the word "persons". I am fascinated to know that we are all of us persons so far as the income tax Acts are concerned; but I understand that the term "person" is defined in the Interpretation Act 1978 as including an individual or, indeed, a body corporate or unincorporate. We understand that there is no need to repeat this particular definition in the order, or that if we did it would be otiose.
The noble Lord also asked me about building societies, prefacing what he said with the comment that the Wilson Committee had had various views on building societies and their activities. I think that even the noble Lord would not expect us to legislate immediately on the report of the Wilson Committee, even on this particular point. It might be thought that this order, or indeed the Competition Act, would he a suitable vehicle, but this Government believe in thinking before they legislate, especially in relation to building societies and the comments that the committee of Sir Harold Wilson has made upon them. But as a general rule the behaviour of building societies will be open to investigation, just as any other firm will be open to investigation. It is only matters which are agreed between the building societies and the Government which are excluded.
My Lords, I hope that answers the points which have been raised by noble Lords and, indeed, by the noble Baroness. Apart from that, I think that the order adds significantly to the Competition Act and is a useful adjunct to it. For that reason, I trust your Lordships will now agree to it.
On Question, Motion agreed to.
5.47 p.m.

DUNDEE PORT AUTHORITY CONFIRMATION BILL
Considered on Report.
The MINISTER of STATE, SCOTTISH OFFICE (The Earl of Mansfield)The MINISTER of STATE, SCOTTISH OFFICE (The Earl of Mansfield) moved Amendment No. 1:
Page 6, line 6, after first ("the") insert ("operations to be carried out in the exercise of the").
The noble Earl said: My Lords, the words to be inserted are, I understand, of a drafting nature, and were left out originally through an oversight. I beg to move.
Lord ROSS of MARNOCK: Yes, my Lords, I think it makes much more sense with the words than without them, and I am very glad that at this belated stage whoever is responsible for the Bill discovered this omission and got these words in just in time.
On Question, Amendment agreed to.

PIER AND HARBOUR ORDER (GREAT YARMOUTH WELLINGTON PIER) CONFIRMATION BILL
Brought from the Unopposed Bill Committee without amendment, and recommitted to a Committee of the Whole House.