Lords Sitting of 18 February 1980

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

TRADE UNION AUDITING BY THE CERTIFICATION OFFICER
Baroness Sharples: 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 satisfied that under Sections 10 and 11 of the Trade Union and Labour Relations Act 1974 the duty to keep annual returns and accounting records laid on both unions and employers is being performed.
Lord LYELL: My Lords, responsibility for enforcing these provisions rests with the independent Certification Officer. In his report for 1978, the Certification Officer said that the requirements of Sections 10 and 11 of the 1974 Act had raised some difficulties; his office was devoting increased attention to these matters with the aim of bringing about a progressive improvement in accounting and auditing standards wherever it was needed. I understand that the Certification Officer will be describing the progress made since then in his Annual Report for 1979, which is due to be published in about three months' time.
Baroness SHARPLES: My Lords, I thank my noble friend for that Answer, and I should like to ask about the Certification Officer and in particular why he is not called the Registrar, as in the Act. I should like to know where I can find him or her and whether he or she has any grounds for believing that auditors have had any difficulties in carrying out their duties.
Lord LYELL: My Lords, the title of Certification Officer was created under the Employment Protection Act 1975. I understand that the change in the nomen-
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clature was considered just for administrative convenience. However, I can give my noble friend an address together with a telephone number which will enable her to find the Certification Officer. As regards the last question that the my noble friend asked, there have been no grounds as yet for the Certification Officer to believe that there is any difficulty for the auditors in carrying out their duties under Sections 10 and 11, and indeed, Section 12, of the Act.
Baroness SHARPLES: My Lords, is my noble friend not prepared to give your Lordships' House his or her name now?
Lord LYELL: My Lords, indeed I am. His name is Mr. John Edwards. I shall certainly communicate the telephone number to my noble friend at a later stage.

JUBILEE HALL, COVENT GARDEN: LISTED BUILDINGS
2.40 p.m.
Lord AVEBURY: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government on what grounds the Secretary of State for the Environment decided not to list the Jubilee Hall, Covent Garden, as a building of architectural and historic interest.
Lord MOWBRAY and STOURTON: My Lords, in 1972, as a result of a special survey of the Covent Garden area, more than 200 buildings were added to the statutory list of buildings of special architectural or historic interest. Jubilee Hall was not among them and this view was shared by the inspector who conducted the local plan inquiry.
The question of listing Jubilee Hall has been reconsidered many times since then, but successive Secretaries of State have concluded that the hall does not have the special architectural or historic qualities necessary for listing.
Lord AVEBURY: My Lords, is the noble Lord aware that that is not the opinion of bodies such as the Civic Trust, Save Britain's Heritage and the

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Victorian Society, which have all recommended that the building should be preserved? Moreover, is the noble Lord aware that prominent sportsmen such as Alan Pascoe, John Taylor, Brian Clough and Henry Cooper have all said that the sporting facilities provided in that building are of extreme importance both to the residents of the area and to those who work in it? Will he accept an invitation to go there, for example, on Sunday morning to see the very large numbers of young people taking part in roller-skating, and then to reconsider the matter and, at the very least, to call in an application for listed building consent, as there is power to do under the 1971 Act, when the application is made?
Lord MOWBRAY and STOURTON: My Lords, I should be delighted to go there any Sunday morning with the noble Lord, Lord Avebury. I fully appreciate that it is a splendid sports area. However, I must point out to the noble Lord, and to your Lordships in general, that listing is not there to deal with the social functions of buildings. I am aware that certain of the Victorian groups and heritage societies have expressed disquiet. However, I can only repeat that this matter has been around since about 1972. It was looked at in depth again by the last Government in 1977, and when we made our announcement in October 1979 it was declared that it really would be final because otherwise the GLC and the developers would never know where they stand.
Lord STRABOLGI: My Lords, may I ask the Government whether they are aware that, if it had not been for the timely intervention of Mr. Geoffrey Rippon, the GLC would have allowed the property developers to demolish almost the whole of Covent Garden? Will the noble Lord ask his right honourable friend the present Secretary of State to try and carry on in the spirit of Mr. Rippon's excellent example, and try to save this hall because, as the noble Lord, Lord Avebury, has said, its preservation is supported by the Victorian Society, the Civic Trust and many other amenity societies? Will he do something about it?
Lord MOWBRAY and STOURTON: Yes, my Lords. I appreciate what the noble Lord has said. However, there was the local planning inquiry, as he knows, in 1977. It is really in the light of that inquiry that we are talking. Although I much regret the possible fate of any big building, the facts are as I have stated.
The Lord Bishop of LONDON: My Lords, is the noble Lord aware that it is not only the amenities societies but the Forum of Representatives, which represent all the community activities in this area, who are totally and unanimously opposed to the refusal to grant listed building consent, and are absolutely opposed to the destruction of this building since they believe that it is essential to the community activities in the area?
Lord MOWBRAY and STOURTON: My Lords, I must repeat to the right reverend Prelate that listing is not for social purposes. My honourable friend Mr. Monro has expressed the very clear view to the GLC and to developers—whoever they might be—that, if the development were to take place, he hopes that at least 5,000 square feet will be allocated for sporting purposes.
Lord DONALDSON of KINGS-BRIDGE: My Lords, is the noble Lord aware that many of us are disturbed chiefly by the fact that the best individual adviser available is actually mentioned by name in the papers as having given perfectly clear advice that this hall should be given a Grade 2 listing? We are very surprised and greatly distressed that the Minister should overrule anyone whom we all trust as much as Mr. Lloyd Warburton.
Lord MOWBRAY and STOURTON: My Lords, the noble Lord is as aware as I am of the facts of the situation. It is not for me to comment on whether the Secretary of State in the last Administration or my Secretary of State overruled that particular gentleman. I repeat: listing does not take account of the social use of a building. I must also repeat that, obviously, I am not an expert on listed buildings, but one must take advice and this is what the Secretaries of State have done, both in the last Government and my own Government.
Lord DONALDSON of KINGS-BRIDGE: My Lords, it is because the Secretary of State has not taken the advice that we are objecting.
Lord MOWBRAY and STOURTON: My Lords, I shall most certainly bring this to the attention of my right honourable friend.
The Earl of GOSFORD: My Lords, may I ask the noble Lord to thank his noble friend Lord Bellwin for the Answers to my Questions on the Jubilee Hall which I put down for Written Answer? Is the Minister aware that the proposals for the redevelopment of this space next to the hall, and of the hall itself, include a sports hall which is to be half the size of the existing building? I was down there yesterday. They had a roller-skating session all morning which was in great popular demand. The smaller hall would not be able to cater for such a sport. Is the noble Lord aware that the Chinese international table tennis team played there yesterday afternoon, attracting a large crowd? Is he also aware that recently £75,000 has been spent on doing up the hall, and that no structural work was necessary?—it is in very good condition, indeed.
Lord MOWBRAY and STOURTON: My Lords, I am aware of all that the noble Earl has said. I am also aware that the £75,000 was spent in the certain knowledge that the building would not be in use for more than five years.
Lord AVEBURY: My Lords, is the Minister aware that the amount of open space in this area is very much less than is laid down by the department in its guidelines, and that the sporting facilities provided by the hall, notwithstanding the fact that they may not be taken into account in listed building consent, to some extent make up for this—including providing playing facilities for two primary schools (St. Clement Danes and Drury Lane) which they would not otherwise have? Is the Minister aware that among the proposals submitted to the GLC for the development of this site was one by the Jewish Cultural Foundation, which involved the preservation of the Jubilee Hall? Will he not urge his friends in the GLC to have another look at this to see whether the proposals submitted by
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that foundation could not be revived and the hall thus preserved?
Lord MOWBRAY and STOURTON: My Lords, I shall certainly bring all these matters to the attention of my right honourable friend and my friends in the GLC, but I hold out no confidence that they will in any way change their minds.

IMMIGRATION ACT 1971: DETAINEES
2.47 p.m.
Lord AVEBURY: My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will list the prisons and police stations where persons were detained under the provisions of the Immigration Act 1971 at the end of January 1890, giving the number of persons detained in each location.
The PARLIAMENTARY UNDERSECRETARY of STATE, HOME OFFICE (Lord Belstead): My Lords, on 31st December 1979, the latest date for which this information is readily available, there were 173 persons detained in prisons under the provisions of the Immigration Act 1971. As the breakdown requested is in the form of a table, I shall, with permission, circulate it in the Official Report. I regret that the information about people detained in police cells could only be obtained at disproportionate cost.
Following is the information referred to:
Persons detained in prison under the Provisions of the Immigration Act 1971 at 31st December 1979.

Males

Females

Ashford RC

12

Holloway

11

Bedford

1

Risley RC

1

Birmingham

14

Canterbury

4

Total

12

Dorchester

2

Durham

1

Gloucester

2

Leeds

5

Pentonville

112

Risley RC

5

Winchester

1

Winchester RC

2

Total

161

Lord AVEBURY: My Lords, can the Minister tell the House whether this

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figure of 173 includes both those who are to be charged under Sections 24 to 28 of the Act, and those who are detained as illegal entrants on the authority of a police officer or an immigration officer under Schedule 2 to the Act?—which means that no charge will be preferred against them. In respect of these latter categories, are they entitled to contact a friend or solicitor under the Judges' Rules and under Section 62 of the Criminal Law Act 1977? In the event of no friend being known, will provision be made by the authorities for informing the duty solicitor at the local law centre, or one of the national organisations which looks after the interests of immigrants, in order to ensure that people are not detained for several months at a stretch without accusation or trial?—as happened in the recent case of Mr. Abraham Habte, an Ethiopian refugee, who remained in Pentonville from 17th November until 5th February, when he was finally allowed to remain in this country.
Lord BELSTEAD: My Lords, I am certain that the answer to the first question which the noble Lord asked me is, Yes. If by any chance I am wrong, I will write to the noble Lord immediately. The answer to the noble Lord's second question, about the contacting of solicitors, is longer. If someone is in prison, having been convicted by the courts, they will be subject to exactly the same rules as pertain for other people who are convicted and are in prison. On the third point raised by the noble Lord about the length of time people are detained in prison, every effort is made to keep the time spent in detention to the minimum, but the reasons for delay are nearly always outside the control of the Home Office.
Lord AVEBURY: My Lords, in the latter half of my supplementary question I am talking about people detained under Schedule 2; that is, the administrative provisions of the 1971 Act. I am asking first whether they can contact a friend or solicitor under the Judges' Rules or the Criminal Law Act 1977, and, in the case of those persons detained as alleged illegal entrants or otherwise under the provisions of Schedule 2, where they do not have a friend and do not know the name of a solicitor, whether the prison authorities or the police authorities would, on their
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behalf, contact the duty solicitor at the nearest law centre, or inform officers of the national organisations which look after the interests of immigrants in general?
Lord BELSTEAD: My Lords, I can only repeat to the noble Lord that if they are not convicted prisoners then they are not subject to the rules which apply to convicted prisoners. If they are convicted prisoners, then they are so subject to the rules.

SYNTHETIC TEXTILES: IMPORTS
Lord DENHAM: My Lords, with the leave of the House, at a convenient moment after 3.30 p.m. my noble friend Lord Trenchard will repeat a Statement being made in another place on imports of American synthetic textiles.

INDUSTRY BILL
2.51 p.m.
The MINISTER of STATE, DEPARTMENT of INDUSTRY (Viscount Trenchard): My Lords, I beg to move that this Bill be read a second time. It has three main purposes, one of which your Lordships will probably regard as being the most important. It changes the powers and policy of the National Enterprise Board, the Scottish Development Agency and the Welsh Development Agency in line with that changed policy; it allows the English Industrial Estates Corporation to operate in a new and, we believe, more commercial way; it tidies up the orders and the use of the Secretary of State's discretion in relation to regional policy; and, fourthly, it deals with a number of miscellaneous but important points that I shall mention in a moment.
In relation to the NEB and the SDA and the WDA, I think I cannot do better than quote first a sentence regarding Clause 1 in the Explanatory Memorandum. The Bill
"provides that the NEB shall cease to have the function of extending public ownership and provides that the NEB and the Agencies shall cease to have the function of promoting industrial reorganisation and industrial democracy".
The tasks left to the NEB I shall return to in a minute, but they are in the Government's opinion extremely important ones.

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The Bill, in relation to the English Industrial Estates Corporation, makes provision for the disposal of property by the corporation and for the use of private finance by the corporation in its factory building programme. In relation to regional policy, it gives statutory recognition to the changes in the regional development grants scheme. The Bill also permits the provision of Government guarantees in foreign currencies under Section 8 of the Industry Act 1972; repeals the planning agreement and compulsory information powers of the industry Act 1975; and provides authority for the Government's advisory services to small firms.
The Bill makes an important contribution to the policies on which the Government are embarked; to the policy of returning, to a market-orientated economy; to the policy of cutting down public expenditure; and to the policy of maximising the private sector. It goes hand in hand with our policies to lower taxes, have fewer controls, and have more incentives and less interference. We cease to rely for the future on some superhuman central wisdom, and instead we are going to concentrate progressively on encouraging and giving free vent to all the brains and all the skills in the nation.
At the present time the profitability of British industry—British industry has been debilitated over many years—is the lowest of any of the industrial countries with whom we have to compete. Therefore, we must proceed at a realistic pace. I do not think I need to emphasise this. I expect that noble Lords will have done the sums with our balance of payments for 1979 and will perhaps have mentally taken away the actual value of North Sea oil and gas in the year concerned and looked at what remains—which is a deficit of £10,000 million. So we have to move by stages.
The NEB first has a task in future to build up and dispose of the many companies which it now has the custody of or has shares in. This will inevitably take time. I want to stress that the Government's view of the task of the NEB and its new membership is that it is a very difficult, very important and very formidable one, and this new task of gradually privatising, is a main task of the NEB in the future.
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When we made announcements last year in relation to the policy of the NEB I mentioned a figure of £100 million from disposals this year. My right honourable friend the Chancellor of the Exchequer has asked me to say that the Government's disposals programme is well on course—this is our general disposals programme—and the target of £1,000 million announced in the Budget will be realised. The details of that programme are a matter for him, but I can inform this House that there is no longer the same pressing need for the NEB to realise £100 million from disposals in the current financial year. The NEB did in fact sell its shareholding in ICL for £38 million shortly before Christmas. Although this is a matter for the NEB to decide, having regard to the interests of the company and the taxpayer, I expect that there will be further disposals before too long.
Despite the reduction in the NEB's scope, to which I have referred, the NEB will continue to serve a useful purpose in a number of areas. These are identified in the draft guidelines which are in the Library and which were in fact printed last December. The NEB, as I have said, first has a major task to look after the 60 or so companies in which it has shareholdings at the present time. It will have a catalytic function in relation to companies engaged in advanced technology in cases where private sources of finance (while the profitability of British industry remains at its uniquely low level) have been unwilling in those circumstances to provide finance for the high risks which underlie advanced technology ventures. The NEB may in certain cases therefore undertake a pump-priming role on a temporary basis. The NEB already has a number of investments of this sort, as your Lordships know, chiefly in the fields of computers and micro-electronics. The Government look to the NEB to maximise the involvement of the private sector in these companies as soon as practicable. The NEB will in addition continue to undertake an investment role in the development of companies in the assisted areas and of small firms in areas of high unemployment. The House will be aware that the NEB has branches in the North-West and North-East of England at the present.
There may be exceptional occasions when the Government invite the NEB to

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undertake temporary support of a company in a situation which they regard as in the national interest. The days of the NEB's wide-ranging merchant banking operations are over, but the tasks I have outlined are very considerable and will require all the talents of the new and highly talented board which the NEB now has under Sir Arthur Knight.
In the interests of time, I will miss some small points in going through the Bill; I can return to them in my reply to the debate, should I be asked to do so. Clause 2 empowers the NEB and the agencies to transfer securities and other property to the Secretary of State and empowers him to direct them to do so. Noble Lords will remember the case of Rolls-Royce, a wholly-owned subsidiary of the NEB which will be transferred to the Secretary of State following the enactment of this Bill. As I have previously explained to the House, it was the Government view that two high-powered sets of industrialists, industrial executive directors and managers, one on top of the other, and the Government's inevitable involvement on top of that, was not a sensible organisational position. No decision has yet been taken in respect of the NEB's other major subsidiary, British Leyland, but although there are many differences between the two, it is possible that it too will be transferred to the Secretary of State.
Clause 3 provides powers for the Secretary of State to have the necessary finance for companies which are transferred from the NEB to his accountability, and he will of course remain accountable to Parliament. Clause 4 enables the NEB and the agencies to reduce their public dividend capital when necessary; that is, when they dispose of a shareholding or transfer it to the Secretary of State. There is no existing statutory authority to reduce public dividend capital, the source of finance which underlies the share investments of the NEB and agencies. The provisions of Clause 4 are therefore necessary because, if no power were available, these corporations would be left with a capital liability for which they no longer possessed the asset equivalents.
Clause 5 returns again to financial limits and provides the overall limits for the Secretary of State and the NEB.
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Where at present the NEB's statutory financial limits stand at £3,000 million and those of the Scottish Development Agency at £500 million and the Welsh Development Agency at £250 million, the previous 1979 Act allowed by order for these to be increased to £4,500 million, £800 million and £400 million. Clause 5 removes that power to increase those limits and at the same time it fixes a combined limit for the NEB and the Secretary of State of £3,000 million, the present level.
Clause 6 reduces the freedom of the NEB and agencies to make share acquisitions without the Secretary of State's consent. For the NEB, the maximum of £10 million established in Section 10 of the 1975 Act will be reduced to £5 million, and for the Scottish and Welsh Development Agencies, from £2 million to £1 million. This reflects the Government's desire for tighter financial control of the investment activities of the NEB and agencies.
Clause 7 deals with the number of directors allowed on the NEB and reduces it from 16 to 12. It also abolishes the statutory necessity for a register of members' financial interests. This is regarded as unnecessary in view of the responsibility imposed on the Secretary of State under Schedule 1 to the 1975 Act to satisfy himself as to the financial interests of members and to ensure there is no clash.
Clause 8 abolishes the Secretary of State's power to act through the NEB by asking them to use his powers to grant selective financial assistance under either Section 7 or Section 8 of the Industry Act; these powers have never been used because in fact there are alternative and normal routes for the application of monies under Sections 7 and 8 which can be utilised, and of course the applications can be backed by a recommendation of the NEB.
Clause 9 is a technical point regarding a power which has never been used in relation to overseas. I therefore come to that part of the Bill dealing with the second main subject, the English Industrial Estates Corporation, Clauses 10 to 13. The Bill does for the English Industrial Estates Corporation what the previous Government did for the equivalent organi

491
sations in Wales and Scotland in 1975. In 1975, when the Labour Government created the Welsh and Scottish Development Agencies, they transferred to those organisations the duties and responsibilities of the Welsh and Scottish Industrial Estates Corporations. In doing so, however, they considerably widened the factory-building powers of the two organisations in a variety of ways. Nothing, however, was done to bring the English Industrial Estates Corporation powers up to date in the same way, and that is what we are now doing and at the same time trying to ensure that the corporation shall act in a more commercial way, save public money and, we believe, do a better job. I am prepared to go into more detail about these provisions at the end of the debate, should I be requested to do so.
The Government basically do not accept that what should be a supplement towards investment in the assisted areas should have become a total substitute or a near total substitute, and therefore we very much want to see whether we can encourage private investment in at least some parts of the assisted areas in relation to the building of Government factories. My honourable friend the Parliamentary Under-Secretary of State announced last Friday that the Legal & General Company had agreed to invest, at a cost of £5 million, in 300,000 square feet of factory and ancillary space in the northern assisted areas. Other institutions are showing an interest. We have no illusions that one can totally substitute for the use of Government funds, but we believe that we can substitute to a high degree and therefore can as necessary fund an extensive programme on a cheaper scale from the point of view of the Exchequer.
Clause 10 of the Bill deals with many matters in relation to the corporation. It gives it the power to dispose of assets and to acquire land directly, rather than through the Secretary of State (which has been resulting in double conveyancing). The clause allows the corporation to act anywhere in the United Kingdom; but in no sense is that a proposal of major significance. The purpose of the EIEC will be to continue in the assisted areas, but we see no reason why it should not have the same powers as the Scottish and Welsh Development Agencies. The clause deals with the Secretary of State's
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powers to direct, and to ensure, that the corporation carries out the agreed policy. It removes finally any doubt about Crown status in the corporation's standing. The Scottish and Welsh Development Agencies do not have that status. Clause 10 also deals with the differences that this makes to the Estates Corporation's activities in acquiring planning consent and the transition from the way that it has dealt with planning in the past to the way that it will now deal with it. We do not believe that this will result in the corporation encountering planning delays. There is very considerable demand from all local authorities for advance Government factories. Should there be any delay, the Secretary of State still has a power to acquire land.
Clause 11 allows the membership of the corporation to be increased. For the duties that it is now to carry out it will need wider skills, and steps are being taken to ensure that the board is composed in a way compatible with the functions now required. I pass very quickly to Clause 14, which deals with regional policy and, as I have said, makes no changes to the policy announced and debated in this House previously. In addition to tidying up those matters it also tidies up the two removals from the eligibility for regional development grants made by the previous Administration in relation to mining and construction. Again, there is no alteration in those two steps, nor in the rate of grant published for the development areas, which we have already debated in this House.
Clause 15 amends Section 8 of the 1972 Industry Act to deal with liabilities denominated in foreign currency, and I shall deal with this in my wind-up speech, if noble Lords wish me to do so. This power is primarily required in relation to the possibility of developing new sources of scarce raw materials. In relation to Clause 16, as the Small Firms Counselling Service (which was also debated in this House quite recently) is expanded, we find that we have no adequate powers for any scale of financing of general advice to small business.
Clause 17 refers to the removal of the planning agreement powers on which the Government in the past put high stock. In fact, only twice have planning agreements been concluded between the previous

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Administration and companies: once in the case of a nationalised industry, and once in the case of a private company. I do not believe that these agreements serve any purpose—certainly not in the policies upon which this Government are engaged.
Clause 18 deals with the same question of the register of financial interests, but this time in the case of the board members of British Shipbuilders, and it removes the necessity for publishing their financial interests. Once more the Secretary of State has to ensure that there is no clash of interests. My Lords, I am sorry to have taken rather long in introducing the Bill. I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a—(Viscount Trenchard.)
3.15 p.m.
Lord LEE of NEWTON: My Lords, the House will be grateful to the noble Viscount for taking us through the detailed provisions of the Bill. On Wednesday of last week we had a very comprehensive debate on economic and industrial matters, and the House did not, I think, very much like that which it saw. The fact that we had that debate then is probably the reason why noble Lords do not consider that this Bill, which in part covers some of those details, is quite so damaging to the economy as I consider it is. Since our debate last Wednesday we have learnt that inflation has continued its rise and has now reached 18.4 per cent. There has been a further deterioration in the balance of payments, and we have reports of still heavier unemployment. Today, I see in the Press that the Engineering Employers' Federation report that they expect 18 months of severe depression in their industry, while the Charterhouse Group predicts a 4 per cent. fall in industrial production this year and a rise of over half a million in the number of unemployed. That is the economic and industrial situation which we have seen develop since our debate last Wednesday.
It is against that background that Clause 5 of the Bill reduces the financial powers of the National Enterprise Board and of the Scottish and Welsh Development Agencies. When we consider the news from Wales in particular that proposal
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will not be exactly glad tidings to them; and we know of the problems of Scotland in the same direction.
The noble Viscount introduced into his explanation of the Bill an atmosphere which was rather different from that introduced by the Secretary of State in his outline in another place. There is common consent that the industries of the nation are in a serious and deteriorating position, and it is under such circumstances that one would expect that a responsible Government would have been applying themselves, and indeed would have been inviting Parliament to join them in that application, to producing legislation calculated to improve the nation's industrial and economic prospects. They waste their own, and indeed Parliament's, time with this miserable Bill, which is simply a blind swipe at the National Enterprise Board and the Scottish and Welsh Development Agencies in order to ensure that the private sector can expand and that the public sector shall contract.
Indeed, during his explanation of the Bill at Second Reading in another place, the Secretary of State concluded his description of its main provisions with the words:
"Thus the Bill gives effect to our manifesto undertakings, and in particular contributes to our policy of reducing public expenditure and reducing the size of the public sector".—[Official Report, Commons, 6/11/79; col. 240.];
by which statement, I assume, he refers to the fact that the Government are forcing the NEB to "flog" some of the assets which it has built up so laboriously, and are continuing their erosion of the public sector in order that they can obtain further contributions towards reducing the public sector borrowing requirement.
Indeed, the Secretary of State rounded off that statement with the astounding remark:
"There should be no need for public sector investment finance in manufacturing industry provided that savings and enterprise are sensibly treated".—[col. 240.]
I wonder where he lives! Where has he been all this time, while the begging bowls have been out in Whitehall and while in so many ways public finance has assisted private enterprise to stay in being in a great many of our industries? He himself decreed a while ago that £20 million should be invested by the NEB

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in titanium. The Secretary of State really gets rather schizophrenic at times, I think, from some of the utterances we hear from him. When saying that there would be no need for this kind of thing if we had the right kind of atmosphere, he did not deem it opportune to inform us whether the sensible treatment he was talking about included a 17 per cent. minimum lending rate and a squeeze on credit facilities, which private enterprise, in many of its aspects, is now suffering from in a very big way. I think that the reason why he makes such statements is to mislead the nation into believing that the decline of our industries is in some unexplained way a product of the policies of the last Labour Government.
The fact is, as we learned last Wednesday (those of us who needed to be taught about it), that the decline has been going on for a hundred years under Governments, some of which had high taxation, some low taxation, some high interest rates and some low interest rates. It did not make the slightest difference to the fact that industry in this country continued its decline. For over 40 years now Governments of both parties have helped to stem the decline by regional development grant schemes, which have certainly aided many regions, including Scotland and Wales, and have prevented them from becoming derelict areas. It is rather peculiar that, at the time when they are further reducing the position in the development areas, we hear that we are going to have enterprise zones, where there will be assistance given to industries, well outside development areas. Perhaps they have been looking politically as well as industrially at the effects of this kind of thing. I do not know; we shall see. Perhaps the noble Viscount will tell us when he comes to reply.
In this Bill the Government are giving statutory recognition to the reduction in the regional development grants scheme on the pretext that the net has been cast too wide. In fact, as we all know, it is simply to reduce expenditure on them. Clause 1 of the Bill prevents the National Enterprise Board and the Scottish and Welsh Development Agencies from promoting any industrial reorganisation or industrial democracy in concerns in which they have an interest. I would have thought that this emasculates half the
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reason for its existence. They have not the power to reorganise, and the Government do not think we need any kind of improvements in industrial relationships. Really, it is quite fantastic that in this day and age, in the middle of a great steel strike brought about largely by the policies of the Secretary of State, we should be having to interest ourselves in further reducing the scope of important instruments like the one we are discussing, to improve industrial relationships in the firms in which it has an interest.
Again, Clause 1 forces the NEB and the agencies to sell assets to the private sector, and it stops the facility contained in the Industry Act 1975 of extending public ownership into profitable areas of manufacturing industry. There could be a political issue between us, I suppose, on that. I wonder how many noble Lords opposite would support the Secretary of State in a statement he made in answer to an interruption on Second Reading. Mr. Park, a Labour Member of the House, said:
"On clause 1, where it provides that the NEB shall cease to have the function of extending public ownership, I want to be clear about what the Secretary of State is saying. Is he saying that if no private capital is available, either at home or abroad, for a particular company or industry which by general agreement is essential in the national interest, the Secretary of State, notwithstanding that, is content to see that company or industry go to the wall rather than allow the NEB to intervene?".—[Official Report, Commons, 6/11/79, col. 247.]
Sir Keith Joseph replied:
"On the first part of the hon. Gentleman's question"—
that is the one I have just read out—
"in the unlikely hypothesis he postulates, the answer is 'Yes'".
Of course, this is sheer, blind obstinacy. If indeed it is the case that the Secretary of State and, I take it, the Tory Government are determined that industry and firms of that type should go to the wall rather than receive public money and assistance, how can they possibly try to convince the nation that they are interested in preventing the decline in British industry or the massive increases in unemployment that we are now seeing? It seems to me, then, that in this Bill there is no real argument that it is going to improve in any way the industrial base of this nation. It is merely, "Our manifesto told the nation that we were going to reduce the

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public sector and increase the private one"—irrespective, of course, of the damage they do in the process.
My Lords, not satisfied with reducing the functions and the powers of the NEB and the agencies, Clause 2 increases the power of intervention of this non-interventionist Government and Secretary of State for Industry. As I mentioned, I think he is a bit schizophrenic at times. Here we are, I repeat, with a steel strike which is bringing the nation's manufacturing industries practically to their knees, being allowed to continue on the grounds that there must be no intervention, while the Secretary of State is here taking powers of intervention which no Labour Government would have ever taken. Where are we to go on all this kind of thing? If there was something of an improvement to be seen on the skyline, then I could understand some of this; but there is no noble Lord opposite, including the Minister, who will tell us that he can see any lightening of the gloom, industrially or economically, at the time that we are being asked to accept the kind of thing set out in this Bill. This comes after our non-interventionist Government have forced huge increases in the price of gas which the industry neither wanted nor desired; and here they even take powers to direct that nationalised industries such as gas, instead of looking at the economics of gas production, have got to make a huge contribution to the public sector borrowing requirement.
Noble Lords may have gathered that I am not particularly keen about the contents of this Bill. But I am not alone in that. Noble Lords who have read the report of the debate in another place will have seen that there was opposition there, too, from the Conservative Benches. In fact, it would appear that the super-hawks are dissatisfied with the performance of the hawks. Prior to the election, of course, they had been promised that the NEB would be abolished. They are not happy that an emasculated NEB is to be permitted temporarily to exist. A number of Conservative Members made this very clear during the debate. They have a point. After all, no less an authority than the present Secretary of State for the Environment told the House of Commons in February 1975—and we
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were discussing the Industry Bill 1975 then:
"I tell the House on behalf of the Conservative Party that we shall repeal this Bill."
Really, the Secretary of State is going all pink, it seems, and the super-hawks are entitled to have their say. Why have they not done it? The noble Viscount may want to let me know when he comes to reply.
Is it, for instance, a combination of reasons such as a memory of the shocking mess they made in abolishing the Industrial Reorganisation Corporation or the Prices and Incomes Board and the subsequent two years' embarrassment of trying to create substitutes for them under other names? You never know. We may see the thing drifting backwards in the way that Mr. Heath did with both the organisations that I have mentioned. Or is it that, in contradiction of the statement that there should be no need for public sector investment in manufacturing industry, they are relying on such investment in much of the highly technological industries which the NEB has developed and in which private risk capital is not available? This again is such an irony within this Bill. We have been told that room is to be made for more private investment—not that we in this party have ever wanted to see it decline; but the fact is that we have lamented that it has declined. But the remarkable fact in this Bill is that the one type of industry which the NEB has and which is not "up for grabs" is the highly technological sector. What a remarkable situation!
I admired the way in which the noble Viscount—I do not know whether he has played football—side-stepped that beautifully. Can there be a reasonable explanation? Why is it that, while we are all agreed (and, indeed, the nation knows) that many of our older industries are in decline—and it looks as if they are going to continue to decline and that without North Sea oil our balance of payments position is unthinkable—some private industry is doing very well in the field of the highly technological industrial innovation? But the NEB has concentrated in large measure upon, and has put its resources into, this type of work. It is the future, if there is a future, for our industrial base. Yet this Government, of all Governments, say: "Hands off! You

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cannot be trusted to be allowed to take over the highly technological developments for which the NEB is responsible and upon which the nation is going to rely more and more heavily as time goes on". Perhaps the noble Viscount will give us the explanation when he comes to reply. Why should it be that there is any danger of private capital not wanting to take up the type of work that I have been describing; whereas those firms like Ferranti, Fairey Aviation and so on, which the NEB rescued from private enterprise's failures, apparently are "up for grabs"?
I ask this question of the noble Viscount. He mentioned in the course of his speech that originally the Government had intended to force the NEB to contribute £100 million in this financial year. We have had reports in the Press that this threat has been lifted. I listened to the noble Viscount's speech as closely as I could. I do not know whether he went all the way. Did he say that the Government are not now expecting the NEB to contribute £100 million during the present financial year?
Viscount TRENCHARD: My Lords, I can answer that very quickly. As I said, my right honourable friend the Chancellor of the Exchequer is no longer requesting the NEB to make a contribution in this financial year of £100 million.
Lord LEE of NEWTON: My Lords, I am grateful to the noble Viscount. "There is more joy in Heaven" over one act of repentance and so on. We, on this side of the House, condemn this Bill because, at a time of acute economic and industrial problems, it restricts the ability of the NEB and of the agencies to continue the good work they have been doing in assisting in the strengthening of this vital section of British industry. Perhaps the noble Viscount will tell me whether I am wrong in believing that the NEB made a profit last year of something like 11 per cent. or more.
The Bill is based on ideological considerations which have no relevance whatever to the nation's problems. The claim that public money should not be necessary in manufacturing industry, provided that savings and enterprise are sensibly treated, is made to look absurd. I have been
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contending that, by the NEB being asked to keep the technologically-based industries that they have produced, this is one of the contradictions which the nation must really look at.
My Lords, I think that after nine months of this Government there will be an awakening to the fact that they are completely irrelevant to the problems which this nation faces once it is understood that they will emasculate public organisations like the NEB which nobody can say has failed and which I contend we can prove is successful. They emasculate it deliberately for no better reason than to expand a private base which they will not trust, anyway, with the technologically-based industries of this nation.

SYNTHETIC TEXTILES: IMPORTS
3.37 p.m.
Viscount TRENCHARD: My Lords, with the leave of the House, I will now repeat a Statement which my right honourable friend the Secretary of State has made in the other place. The Statement is as follows:
"The House may be aware that the European Commission announced this morning their decision on the United Kingdom application for import quotas on certain synthetic textiles. My honourable friend the Minister for Trade and I, together with officials of my department, have held extensive talks with the Commission to stress the urgent need for action to stabilise imports of these products in order to check further factory closures and redundancies in these threatened sectors.
"For their part, the Commission have been anxious to avoid the United Kingdom's application leading to a breach in the open trading relations with our main partners. The United Kingdom, with one-third of its GNP sold in export markets, shares this interest in avoiding an outbreak of retaliatory action and damage to our wider trading interests. Moreover, the United Kingdom is itself a major textile exporter. The Commission has therefore been concerned to ensure that any action taken is strictly within the terms of Article XIX of the GATT.
"Against this background, the Commission has agreed quotas on both polyester and nylon carpet yarn at the following levels for the calendar year 1980: for polyester filament yarn, 9,053 tonnes, compared with imports in the final quarter of 1979 running at an annual rate of 15,600 tonnes; for nylon carpet yarn, 7,500 tonnes, compared with a 1979 final quarter rate of 9,150 tonnes. These quota levels will cut imports back from the very high level reached at the end of last year, but it is our view that they should not be so severe as to provoke retaliatory action on the one hand, nor, on the other, to create damage to the downstream textile and clothing industries which depend on the availability of low-cost fibres for the competitiveness of their own end products.
"With regard to man-made fibre tufted carpets, our concern has been to avoid the quota on nylon carpet yarn damaging the interests of the United Kingdom carpet industry; for this reason we felt that quotas on both products should be introduced. The Commission has, however, had to examine our application against the definition of 'serious injury', since otherwise a number of other European countries might also seek quotas for their products leading to an escalation of protectionism. While the increase in imports of man-made fibre carpets has been substantial during 1979, growing from 1,085,000 square metres in the first quarter to 2,162,000
square metres in the fourth quarter from non-EEC or preferential sources, in fact, the penetration of the United Kingdom market from these sources amounted to only 8·5 per cent. in the final quarter of 1979. In the Commission's view, this level of import penetration was insufficient to warrant a quota based on serious injury at this stage. Despite this we have obtained a statement to the effect that the Commission will monitor imports vigilantly and recognises the necessity of immediate recourse to safeguard action if present trends continue and lead to serious injury.
"I am not wholly satisfied with the Commission's response to our application. But we have to acknowledge the overriding duty of the Commission
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not to provoke a sudden surge of protectionism. On balance, therefore, I think the outcome is a reasonable one. Within these constraints the Government will do all in their power to safeguard the interests of the United Kingdom textile and clothing industries. I hope that these quotas and the very firm statement on carpets will go a considerable way to stabilising the exceptionally difficult trading conditions which the industry has faced during the past year."
My Lords, that concludes the Statement.
3.43 p.m.
Lord BRUCE of DONINGTON: My Lords, the House will be grateful to the noble Viscount for having made the Statement. We on this side of the House must express our immediate dismay at the result of what must have been protracted negotiations with the European Commission. I say "protracted negotiations" because the statement mentions the term "urgency". Dealing first of all with the tufted carpet quotas on which the Government have not succeeded in obtaining any concession from the Commission other than a promise of vigilance—whatever that may mean in EEC circles at the present time—one might ask the Government just how they view the Commission's definition of serious injury. The Government are themselves satisfied that the existing arrangements will do damage. What is the difference in their mind between damage and the Commission's concept of serious injury? We take the view that Her Majesty's Government would not have made application at all on the tufted carpet side unless they themselves had been convinced that there was the prospect of serious injury and damage to this particular section of the industry. I ask the noble Viscount to particularise a little further as to his Ministry's discussions with the EEC Commission in this regard.
In regard to the polyester filament yarn quota, this of course represents some 58 per cent. of the annual rate achieved in 1979. I shall return to the question of the annual rate when I come to the next part, dealing with nylon carpet yarn. I refer to 58 per cent. of the annual rate achieved in 1979, but this was the year in

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which an unprecedented effort was made by the USA in the penetration of the English market, in which they achieved a 30 per cent. share in the final quarter, and the new quota is some 50 per cent. higher than the 1978 figure. I shall be glad to have the comments of the noble Viscount on that aspect of the matter.
We now come to the quota for nylon carpet yarn. Seven thousand five hundred tonnes represents some 81 per cent. of the final quarter of 1979. Why did Her Majesty's Government permit the Commission to shift its base from the full year 1979 which it adopted when assessing the quotas for polyester filament yarn? Why did it allow the Commission to take the last quarter of 1979 as its quota? For a very good reason, my Lords, because the current quota now agreed by the Government with the Commission represents some 30 per cent. higher than the entire imports from the USA in 1979. These represent very serious questions which the Government must answer.
We are well aware of the difficulties in negotiation with the EEC Commission and, above all, in arriving at agreement with the remainder of our colleagues in the Community, who may be variously affected by these matters. I should like the noble Viscount to give us some indication of the attitude of our EEC partners—individually if necessary—towards these arrangements.
In his Statement the noble Viscount refers to the possibility of other member-States also making application for quotas. Why should they not do so? If they are justified, they should do so. I sincerely hope that the noble Viscount will also clarify some of these matters. On behalf of my noble friends, I must express the view—which we are quite convinced will be widely shared in the textile industry itself and by the people at large—that these arrangements are thoroughly unsatisfactory.
3.48 p.m.
Baroness SEEAR: My Lords, we on these Benches should also like to thank the noble Viscount the Minister for repeating the Statement made in another place. We recognise of course the very considerable difficulties being experienced in the textile areas and in industry con-
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cerned with man-made fibres. We know full well that the short-term position in those areas is extremely difficult. At the same time, we regard as a far greater risk a surge of protectionism which could bring the greatest possible damage to this country, to the EEC Community and indeed to the world as a whole. Therefore, while recognising the need to give as much assistance as possible to the future of the textile industry, which inevitably has to be for a smaller industry in the longer run, we cannot but agree that it is right to resist the extremes of protectionism which are being demanded in some quarters in this country. The Commission surely must be on the side of avoiding protectionism, and of granting quotas only where they are absolutely vital in the short term. Therefore, understanding full well how unwelcome this news will be in the textile industry and sympathising with the reasons for their distress, none the less we believe that the decision of the Commission is right and that the Government are right to accept it.
Viscount TRENCHARD: My Lords, I should like to deal at this stage, if I may, with the points made by the noble Lord, Lord Bruce, and the noble Baroness, Lady Seear. As regards protracted negotiations, I think the noble Lord, Lord Bruce, was really saying that this had taken a long time. Indeed, it has taken a long time, but international negotiations do, and it was not until the end of September 1979 that we had real figures from the industry, particularly relating to the American feedstock side of things, on which to commence detailed negotiations.
We are not accepting a meaningless statement in relation to tufted carpets. The Statement that I read included the phrase:
"the Commission will monitor imports vigilantly and recognises the necessity of immediate recourse to safeguard action if present trends continue …"
So we are not just accepting an empty phrase in relation to carpets. Concerning the size of quotas, as regards polyester the basis is the average of the year 1978 and 1979. In the case of carpet yarn, the figure, although higher and although not such a big reduction on the last quarter of 1979, has to recognise the need to allow the users of United States yarn—and there have been users over a prolonged period—to be able to obtain the United

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States yarns they want at reasonable prices, or more damage will be done to the downstream industries. I thank the noble Baroness, Lady Seear, for her balanced remarks, My right honourable friend does have a difficult task in balancing the many points of view involved, and we certainly do not want to see a return to one step against another of further protectionism.
Lord ALPORT: My Lords, may I ask my noble friend whether he will recognise how many Conservatives will welcome this small return to the traditional Conservative policies of tariff protection and import control, as against the prevailing economic fallacies, which are Liberally originating, of laissez-faire and free trade?
Viscount TRENCHARD: My Lords, I believe that we are dealing rather more with the modern Conservative philosophy which believes in giving enough time for the readjustment of industry, to which the noble Baroness, Lady Seear, referred, and which also deals with situations where there is strong evidence that our industry does not face fair competition. In this respect, the feedstock and energy prices have had a major bearing in this subject being raised with Europe and the protection we have asked for.
Lord HALE: My Lords, when the noble Viscount made his first Statement I understood him to say a few more words than those he re-quoted to my noble friend on the Front Bench. I think he said they said:
"…if the imports increase and the situation gets worse".
which seems to imply a rather long time before coming to a decision. You want two facts replaced, and personally I hope that is a mistake and it should be, "or", or at any rate is not intended to indicate a two-pace system involving delay, because the matter is urgent.
I should like to thank the noble Viscount for the way he gave the Statement and for his previous assurance, which was at least an advance on the reply we had at the end of the Common Market textile debate which was initiated by my noble friend Lord Rhodes. May I ask the noble Viscount this: If he is considering what is to me a new development, what is the position if companies have amal-
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gamated across the seas and if, for example, the goods that were being produced in South-East Lancashire last year are now being produced by a closely associated firm in one of the South-East Asian countries which has no special entry into the Common Market?
Finally—and I admit this is perhaps a little outside the question, but I sought to raise it the other day, I think quite properly—has the noble Viscount observed the very sudden contraction in the textile machine-making industry in this country, especially in regard to one of the most respected firms which has been operating for 100 years and which, apparently, is planning to transfer its output of textile machines from that factory to South Korea? Will that not raise a complication, and should I write to him about it?
Viscount TRENCHARD: My Lords, I think it would be the wish of the House that I should deal by correspondence with the second two points raised by the noble Lord, Lord Hale, which do not refer to the United States. However, let me just tell the House, with regard to subsidiaries overseas, in the British situation any imports are taken as counting fully against any quota that exists, so it does not matter whom they are made by, and any imports, even outward-processed imports, will count as imports within the quota. Perhaps I could deal with the other questions by writing to the noble Lord.
Lord SPENS: My Lords, is the Minister aware that in 1963 the United States Government under President Kennedy, as an emergency measure, very nearly doubled the import duty on woven Wilton carpets and that emergency import duty remained for very nearly 10 years? Could not the Commission be thinking of something in those terms? As far as I know, no retaliatory action was taken by anyone else because the United States carpet industry was not in those days exporting many carpets.
Viscount TRENCHARD: My Lords, the point made by the noble Lord, Lord Spens, is very relevant and my right honourable friend the Secretary of State has taken full note and has discussed with our friends both in the United States

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of America and in Europe the American systems in relation to the protection of its own textile industry. I personally was not aware of the particular historical case that he mentioned: I shall look it up.
Lord DRUMALBYN: My Lords, may I ask my noble friend whether, on the tufted carpet side, the root problem here has really been dealt with? Is not the root problem the subsidisation of feedstock by the United States of America, and is not the appropriate way of dealing with it a compensatory duty so as to equal that? This is fully provided for in GATT and should it not be done in this case, and done immediately? May I also ask my noble friend whether he really thinks that, had we not been moving through the medium of the Community here, we would have dealt with this a long time ago?
4 p.m.
Viscount TRENCHARD: My Lords, my noble friend raises another technical avenue which we considered in relation to taking action in this area. More than the question of feedstock energy is involved. We decided that the better course for the immediate protection of the industry and the threatened damage to it was Article 19, and since the rest of the Community were not prepared to back this action this automatically meant quotas, rather than tariffs. That is a technical explanation. I bear in mind very strongly what my noble friend said in relation to the theory of the position, but I think that we adopted the correct tactical route.
Lord DRUMALBYN: My Lords, I wonder whether I may follow that up. Can my noble friend tell us why the penetration in this case has been in this country? How have the other Members of the Community been able to avoid it? Also, can he tell us how we are going to avoid that sort of thing in the future?
Viscount TRENCHARD: My Lords, the main reasons for this are not connected with tariffs or protection. They have to do with language, with the efficiency of the British distribution system and, in terms of the products concerned, with the particular applicability
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of the products. So the main reasons for Britain perhaps being the first country to have to cope with a major upsurge of American goods are technical, and are not reasons of protection as such.
Lord ROBBINS: My Lords, while not wishing to disagree at all with the Minister in the catalogue of reasons which he has just recited, may I ask whether he would agree with me that there is a reason which has not been mentioned on either side of the House, but which certainly contributes to the growing apprehension with regard to the volume of imports in general; namely, the probable over-valuation of the pound sterling, which is a circumstance which is not due to either party and is partly due to the success of North Sea oil, and partly due to the inflow of capital?
Viscount TRENCHARD: My Lords, the noble Lord, Lord Robbins, is quite correct. This was one of the factors outside the feedstock question which led us to take the particular route that we have taken.
Lord BRUCE of DONINGTON: My Lords, the noble Viscount will recall that at the conclusion of my remarks I asked him whether he would make some statement as to the attitude of our other EEC partners on this whole question.
Viscount TRENCHARD: I am sorry, my Lords, that I did not deal with that matter directly. I mentioned it just now. We have not been able to get support from other EEC countries. Sometimes I worry a little about the current state of development of the EEC, in terms of understanding that different questions affect different countries with greater severity. I know that my right honourable friend the Secretary of State for Trade has this point very much in mind and, with goodwill in the future, I hope that we shall all be more attentive to problems which affect each other. There are cases in the reverse direction—it would be wrong to go into them in detail at this stage—and there are industries where we no longer have a stake, where European industries still do, and where very often we are advocating a freer increase of imports of cheap goods into Britain, which we can then of course recirculate to Europe.

INDUSTRY BILL
4.5 p.m.
Second Reading debate resumed.
Baroness SEEAR: My Lords, when the previous Administration introduced the National Enterprise Board, we on these Benches welcomed the general initiative, welcomed the introduction of the board, as we had considered that the abolition of the IRC had, in fact, been a serious mistake. But we did at that time feel that some of the powers of the NEB were too extensive; that they had taken on to do too much and that the provision for the extension of public ownership was a quite unnecessarily doctrinaire element introduced into the legislation—legislation much needed in order to further the development of British industry.
That doctrinaire element, that partisan element, has unfortunately been reflected in the legislation which is before your Lordships' House today. Just as the original introduction of the NEB was accompanied by an injunction to extend public ownership, so the present Bill is founded, apparently, on the belief in the importance of pushing private enterprise to the limit, in so far as that can possibly be done, and reducing the function of the NEB in the interests of trying to extend private enterprise. This partisan approach to the functions of the NEB from both of the major parties seems to us entirely regrettable.
British industry, in its present situation, needs a partisan approach to its development as it needs a hole in the head, and the sooner we get out of the mood of thinking that the flourishes of the manifesto of either party have to be reflected in the policies adopted before our miserably ailing industry, the likelier it is that we shall move towards the recovery that all of us presumably wish to see. Let nobody underrate—and I am sure that nobody in your Lordships' House does underrate—the seriousness of the decline in industry at the present time, and the urgent need to have policies which rise above party considerations and which put the real reconstruction of industry, the real development of industry and the hope of a future for industry, before all manifestos and all party political advantage.
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Surely, it must be clear that we need a National Enterprise Board. Facing us over the next years is a mammoth task of reconstruction and development. Inevitably, there will be a running-down, but let it be a guided and a planned running-down of industries for which there is very little future. We have just been talking of some of those problems in connection with the Statement which we have been discussing. We need an instrument to spearhead that development and that running-down of industries which cannot hope to survive in the world that is changing around us from month to month rather than from year to year; of industries which have somehow to forge a new future against the rise of the middle income countries—the very welcome rise which is reflected and underlined, after all, in what we have been reading in the Brandt Report. It is highly desirable that these new countries with new industrial enterprise should go ahead, but this requires changes of a mammoth kind in this country. For this, we need a really effective instrument to guide and help the reconstruction and development of the new industries which will have to arise to take the place of those for which there really is no future.
Therefore, we are of course glad that the Government have recognised that it is necessary for the NEB to have funds to inject into the industries of the new technology, but this kind of development needs greater, not reduced, funds. That move from the declining industries to the new industries must be done on a large scale and must be done quickly so this is surely no moment to be reducing the amount of money to be put into the hands of a National Enterprise Board—granted a reconstructed National Enterprise Board—when we need a board of the highest calibre for the work that has to be undertaken in the immediate future and in the not so immediate future.
So we regret the whole trend of this legislation which is to minimise the function of the National Enterprise Board, which reflects a lamentable underestimate of the task of restructuring and reorganisation that faces this country, the mood in which it needs to be undertaken and the resources that are required in order to bring it about.

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Along with this, we must regret the decision to move away such powers as the National Enterprise Board has had back into the Department and the hands of the Secretary of State. Why is it that the Government have decided to do this? I know that at the present time Quango hunting is a favourite political and media device, and no doubt it has great support in official circles. But there are Quangos and Quangos. Surely we need to remind ourselves that we set up Quangos because we need bodies of people of high expertise to undertake tasks which can be undertaken only by people who are specialists and expert in the areas in which they are required to work.
We need a National Enterprise Board comprised of men and women with the highest possible training and experience in finance and industry—people who, because they have inside knowledge and inside experience, will understand in detail what is involved in this task of reorganisation. With the greatest respect to the Department of Industry, our Civil Service tradition is such that it does not give us people with that degree of specialisation and expert knowledge.
Sometimes we in this country forget that over the last decade we have bred a generation of younger men, coming out of our universities and business schools with experience in our most successful industries. And do not let us forget that we have successful firms. I know that the noble Viscount, the Minister, is very well aware of this, but perhaps not all his colleagues, who lack his industrial experience, are aware of how much things have changed inside the industrial field and inside the leading British firms. It is people with that kind of experience whom we need to lead the changes which have to take place in British industry; they have the discernment and the experience that is required to decide on the policies and programmes which this restructuring requires. You do not rightly go to the Department of Industry and you do not rightly go to the Secretary of State and his Civil Service advisers, if you want that kind of job done.
It was for this sort of reason that Quangos were set up. While there have been some Quangos which have indeed been redundant—and it is a good thing to see
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them go—there are others which require this kind of specialised knowledge and detachment, for which we very badly need to keep them; and because of the particular kind of knowledge which is required and which cannot be found inside official circles I suggest that the National Enterprise Board is pre-eminently such an organisation.
Finally, we can only deplore the extraordinary decision that the National Enterprise Board should no longer have a responsibility for developing industrial democracy. "Industrial democracy", I recognise, is an extremely vague term. No three people gathered together will agree on what the meaning of "industrial democracy" is. But perhaps in this context that is an advantage, because in this context the injunction to develop industrial democracy could well be interpreted to mean that there has to be a decided, firm effort to get the maximum degree of employee understanding, involvement and participation.
We are talking, in terms of the work of the National Enterprise Board, of change—of the very painful alterations which have to be made as old industries decline and new industries are being born and developed. If ever there were a situation in which it is absolutely essential for success that employees should fully understand what is involved, and in which, understanding, they should be committed to the change because there is a direct advantage for them, it is the situation in which the National Enterprise Board operates.
It is a lamentable indication of the Government's failure to understand the problems of change in this country that has led them to remove this instruction to the National Enterprise Board to foster industrial democracy. It passes my comprehension how the Government can believe that market forces, to which they are so devoted, will by themselves bring these changes about. These changes involve changes in the lives and expectations of individual men and women in industry up and down this country. They are not understanding of the hidden hand; they want to know, in terms of the detailed changes in their own work situation. They want to be convinced that it matters to them. They want to

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have it explained to them why it is necessary that changes should be made, and how change is going to affect them.
The job of the National Enterprise Board should be to bring about the change in industrial organisation and industrial structure which this country is crying out for, and without which we shall decline beyond recovery. If this is to take place, then it must be done with the maximum degree of understanding and involvement in industry. The case for industrial democracy, however defined, is stronger in this context than anywhere else.
4.17 p.m.
Baroness WOOTTON of ABINGER: My Lords, in the spate of controversial legislation that is about to descend upon your Lordships' House from another place, there may, I think, be some Bills which raise larger moral issues than the one which we are discussing tonight, but I do not think that there can be one which more devastatingly exposes the contradictions and conflicts at the heart of the Government's philosophy in relation to economic policy.
I am most grateful to the noble Viscount, Lord Trenchard, for the skill and clarity with which he has explained the concrete measures by which that philosophy may be put into effect in this Bill. Naturally, he has not explained the philosophy itself, because that he takes for granted. I am also grateful to the noble Baroness, Lady Seear, for her spirited defence of the National Enterprise Board which will be the main theme of my observations tonight. On behalf of the Liberals, she has accused both main parties of doctrinairism. Perhaps it is the function of the Liberal Party to take strong lines and to avoid the charge of being doctrinaire by the avoidance of any conspicuous doctrine.
First, to understand this philosophy I must ask your Lordships to go back to the Budget which this House introduced last summer. In that Budget, the Government, in honourable discharge of its election promises, made substantial reductions in income tax. Those reductions had been estimated to amount, in a full year, to no less than £4,610 million, which is still, even today, a very considerable sum of money. I am quoting
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from a Written Answer given in another place on 3rd July of last year. Of that large sum, about 16 per cent. went to 41 per cent. of the taxpayers with the smaller incomes—incomes, that is to say, not above £4,000 a year. Slightly over one-third went to persons at the other end of the scale, with incomes of over £10,000 a year, and nearly half of that went to persons whose incomes exceeded £20,000.
These concessions were ostensibly justified at the time by the Conservative philosophy that high taxation, especially on the larger incomes, has operated against incentives and that the recipients of these larger rebates would devote the additions to their incomes to developing and modernising stagnant British industry. In passing, my Lords, I cannot refrain from observing that, as I see it, the "true blue" Marxists are found not on the far Left, but in the heart of the Conservative Party, for their absolute conviction that mankind is motivated by economic influences alone.
Now, my Lords, what happened? These relatively affluent taxpayers received considerable sums of money but, so far as one can see, far from opening up new and experimental businesses concerned with new technology and so forth—things which most of us laymen do not understand, and most of them did not understand either—they appear, as we might well have foreseen and some of us did foresee, to have spent the money in trying to restore their personal standards of living to the levels by which they had been eroded by previous taxation. They used the money to change their cars, to restock their cellars and possibly to renew their Caribbean holidays. Perhaps the more prudent among them thought they should make further investments lest once again there might be a succession of Labour Governments who would erode their income by further taxation. If so, they very prudently (one imagines) purchased Stock Exchange securities relating to companies whose future, they felt, was reasonably well assured rather than to new and experimental things on which the future of British industry depends. For that, there is no evidence that they would take the trouble or the risk involved. Probably they felt it would be safer and simpler to buy the Stock Exchange securities that would be their standby. But, my Lords,

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purchasing bits of paper on the Stock Exchange does not increase employment or even swell our gross domestic product. Anyway, whatever became of that £1,560 million? It has not revitalised British industry and noble Lords opposite have been heard to express regret that the tax reductions that were intended as incentives have proved so disappointing a stimulus to industrial progress.
We have to reckon with some new facts in the present situation which this philosophy overlooks. The first is that well-to-do individuals no longer fill the role traditional in the economic theory of a capitalist society. Today, at the best their contribution to investment is not what it used to be, owing to the growth of corporate enterprise. Moreover, at the moment private persons are so discouraged and fearful about their future that they are, in a manner of speaking, as private investors, striking. So what could the Government have done in the face of these facts? Instead of donating that £1,560 million to the higher taxpayers, they might have redirected it to the one and only institution in the country which would be bound by statute to invest it, and to invest it particularly in the rehabilitation of British industry; namely, the NEB. After all, my Lords, the NEB has a pretty good record.
Lord HARMAR-NICHOLLS: My Lords, may I ask a question? I always follow the noble Baroness with great care. Is she suggesting that never in any circumstances, on the basis of her argument, ought taxes to be reduced, particularly the high ones? Is that the end of her argument?
Baroness WOOTTON of ABINGER: My Lords, it is not the purpose of my argument. I am in favour of reducing taxation in certain areas and at certain times; I am not in favour of reducing taxation by a sum of £1,560 million in the hope that it will stimulate the growth of new industries, which it will not. I am referring to personal taxation, of course. The noble Lord well knows that any argument can be held up to ridicule by perpetuating it to infinity, which is the line which he has followed. I am not dealing with infinity.
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The record of the NEB, discounting the millstone of British Leyland and Rolls-Royce which has hung round its neck from the beginning, and which has always been regarded as an extraordinary item not to be included in the regular accounts, shows that it has done pretty well. If we look down the list of companies in its last report, of the 16 subsidiary companies in which it has a majority holding and the 26 other companies with which it is associated with a rather smaller holding of shares, we see that many of them are concerned with micro-processors, data systems and other modern mysteries, unknown to most of my generation but which we realise are essential to the effective future of British industry. They have in fact done the job they were expected to do.
Would not expansion of those enterprises have been a more productive use of that £1,560 million than putting it into the pockets of individuals already fairly well off, to spend exactly as they please? But no. In the Tory philosophy the NEB is a form of public enterprise; and public enterprise, straight and simple, is a Bad Thing—capital 'B' and 'T'. So instead of using the NEB to break the strike of private investors—and the Government, after all, have no conscientious objection to strike breaking—the Government introduced this Bill in order to hamstring the NEB in every possible way; to reduce its funds, to cancel any future Secretary of State's power, to raise further funds; and to compel the board to hand over any of its assets on demand to the Secretary of State. In that case presumably the industries involved would be consigned to the tender mercies of the civil servants in the Secretary of State's department.
Here come the conflicts. I should have thought that in Tory philosophy that would have been an even more pernicious form of public enterprise than leaving those industries in the hands of a board, the members of which had at least a good deal of business experience. In the end it looks as though the NEB is going to be left with two functions, and those only for the time being: for the time being it is still to continue investment in advanced technology where the risk has discouraged private capital, and it is to assist firms, particularly very small firms, in areas of severe unemployment. Apart from that, as the right honourable gentleman the

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Minister for Industry put it in another place, we must expect to see disposals by the NEB as a natural part of its activities. A most elegant description of suicide!
What it comes to then is that the NEB is to be continued, and it was praised by the noble Viscount, Lord Trenchard, and encouraged for its future, which is never to touch any juicy plums but to cope with a few distasteful items from which the business world recoils. So there we are. Private enterprise continues, quite understandably, to sulk in its tents while for doctrinal reasons a lively and efficient public body is not allowed to fill the vacuum thus made, even though it has amply demonstrated its ability to make a profit of 11 per cent. or 12 per cent. per annum. But for that achievement it is to be rewarded by a Bill which expressly forbids it to extend public ownership, including of course extension into areas of profitability. No wonder the members of the board all resigned in a body when they saw the red light warning of what was likely to come! They have been replaced by others who have presumably accepted these appointments on a temporary basis, organising their own suicide as the noble Viscount, Lord Trenchard, has so elegantly described.
Meanwhile the more affluent taxpayers are disposing as they please of the £1,560 million which would have done a lot of things in other directions as well as that in which we are concerned in this Industry Bill, such as encouraging new and modern forms of investment. That money might have been not returned to the taxpayer but redirected to the one body which could have handled it with experience already gained in assisting industry to adjust to the changing demands of modern technology. Surely the savage attack on the NEB contained in this Bill carries doctrinaire prejudice on public ownership to a level which is sheer irresponsibility.
4.31 p.m.
Lord BALOGH: My Lords, I rise to congratulate the two noble Baronesses for their speeches, which were devastatingly effective. It seems to me that the other side ought to listen to their arguments, which are not merely theoretically sound but tested in practice.
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This measure is a replay of Heath Mark I when he abolished the Industrial Reconstruction Corporation and regretted it ever after, and said so. It seems that the present Government are not going to learn even from the mistakes of their predecessors.
I would like to say only one more thing to strengthen the case which the two noble Baronesses have made to the House and that is that general measures palpably fail. We had very significant under-valuation of the pound in 1975/76 and industry did not revive. I think that even the Cambridge Applied Economics Department does not quite go far enough in trying to get the necessary weapons and policies right for the revival of British industry. General measures fail and general tariffs would also fail.
I am quite convinced that there are only two ways out of our malaise, or perhaps a combination of the two. The first is to have a National Enterprise Board with extended, not reduced, powers and undertake the restructuring through it; the other is selective protection supervised by the NEB. We have had protection in the form of devaluation and depreciation, which did not help, and therefore either selective controls will be necessary—in which case either the Ministry or the NEB will have to be given greater powers to supervise the effective use of the funds which accrue to industry as a result of the depreciation—or indeed, if that is not considered feasible under our obligations to GATT and the EEC, there is only one way, and that is the way which was trodden rather slowly, rather too late, in establishing the NEB. I hope that when this Government goes out in defeat and obloquy there will still be some industry left for a new extention of the NEB to take charge of.
4.35 p.m.
Lord HARMAR-NICHOLLS: My Lords, I had come to listen to the speeches in this debate with no intention of making a contribution, but I do not think anybody with any sense of fairness could sit in silence and listen to the last three speeches without putting some other comment on the record. I believe that for the two noble Baronesses who have made a contribution, as always supported by the noble Lord, Lord Balogh, to show

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such irresponsible impatience in dealing with a matter of this importance is quite unforgivable, particularly as they are all well esteemed and experienced Members of your Lordships' House.
Baroness LLEWELYN-DAVIES of HASTOE: My Lords —
Lord HARMAR-NICHOLLS: My Lords, my name is not on the list, but I do not think there is anything in the Rules which would not allow a Member, with the permission of the House, to make a comment at the right time. The noble Baroness always likes to interrupt me, but I am not easily interrupted when there is a point that I think ought to be made. The point that I think ought to be made is the absolute nonsense of the suggestion being made by all of the speeches, that the lack of investment and the fallback in industry generally today has anything to do with what the Government have done. This Government have been in power for seven months. Does any noble Lord think that in that period any government legislation can even begin to show itself? Do not noble Lords think that before they made this wholesale criticism —
Baroness SEEAR: My Lords, when the noble Lord reads Hansard he will find that it is not there. I never said anything about the failure of this Government to intervene.
Lord HARMAR-NICHOLLS: My Lords, perhaps I was referring rather more to the other speeches. I will make a comment on the speech of the noble Baroness in a moment.
Baroness SEEAR: My Lords, the noble Lord was referring to the three previous speeches.
Lord HARMAR-NICHOLLS: My Lords, I will come to the speech of the noble Baroness in a moment, because there was one part of her speech which I found completely unacceptable. But, if I may deal with this point first, the idea that in seven months you can expect the waving of a magic wand to produce the sort of panacea suggested —
Baroness WOOTTON of ABINGER: My Lords, I made no reference whatever
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to the failure of the Government in seven months. I made reference to the fact that private investors have not come forward with money.
Lord HARMAR-NICHOLLS: My Lords, the noble Baroness said that the amount of money left in the taxpayers' pockets in the last Budget had not shown itself in investment. How does she know? The actual payment of the tax reduction agreed in the last Budget has not been made yet. How does the noble Baroness know how it will be used? What evidence has she got that it is being used to enhance people's standards of living with all the fripperies that the Left Wing always talk about? There is no evidence yet that this tax reduction has been used in any other way than in a sensible and responsible way.
Lord BALOGH: My Lords, the noble Lord does not read the newspapers, that is the trouble.
Lord HARMAR-NICHOLLS: My Lord, the noble Lord is too much of an academic to know what really happens in this world.
Baroness LLEWELYN-DAVIES of HASTOE: My Lords, since the noble Lord would not allow me to intervene for a moment, although he has since, perhaps he will allow me to say that I was not going to interrupt his argument; I would not have thought it was worth it, frankly. What I was going to ask him was whether he thought it proper or wise to refer to two of the most respected Members of this House, personally and intellectually, as irresponsible.
Lord HARMAR-NICHOLLS: My Lords, is the noble Baroness saying that in this House we are anything other than equal? She heard the comment the noble Baroness made about my question. Is she allowed to hit back hard, and we, because certain people are sacrosanct because of their general reputation outside this House, cannot do the same? Is that what the noble Baroness is saying?—because I am not prepared for people on this side of the House to sit in silence, as they have done over the years, listening to the sort of criticism which bears no relation to the real world in which we live. I believe if we are to preserve the free enterprise

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system of this country we on this side of the House have to be prepared to hit back and fight hard for what we truly believe is in the best interests of this country. That is why, without having my name on the list, I presumed to come in; I thought it right to have on the record a contrary view to that of the noble Baroness, whose reputation is very high in this country. There is no truth in the suggestion that the tax reductions have been used in other than a responsible way. The noble Baroness has it on the record that they have been wasted and frittered away.
If I may turn to the noble Baroness, Lady Seear, I was very interested when she skirted around industrial democracy and said that it is so vague that nobody knows what it means; it can be be meant to mean what you want it to mean at the minute when you want to win a particular argument. But the part of industrial democracy that taught me to beware of the message of the noble Baroness is this. Is she suggesting in her interpretation of what industrial democracy should be that the National Enterprise Board should lay down what the relationship is between management and men?
Does she not think that, if there is to be real understanding in industry —and Heaven knows! we all want that because the nation needs it —it should be brought about not by a Quango or any such thing but by the management and men who have to work together every day? In my view, to put forward the argument that some outside group, because of some special qualifications that she says they have (but they do not always have those special qualifications), can step in and do the job, which good management with good relations with the men on the shop floor must do, is, in my view, dangerous talk. I do not believe that there is any shortcut that way. I believe that we must let the private enterprise industries, which are overwhelmingly the wealth producing parts of this country, sort their problems out themselves, because they are together every day and they know their problems.
I do not believe that the last three noble Lords who contributed to this debate were fair. In particular, I do not believe that the noble Baroness who I admire so much and whose reputation is held so high, used the great skill and knowledge that
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she possesses in a proper way today. I say that because of the description she gave of the possible effects of the very essential reduction in taxation which this over-taxed country needs if it is to get initiative back again. It was only because I felt incensed because the record was too one-sided, and did not give a true picture of any hope for the future, that I felt it right to take advantage of the opportunity to intervene in this debate, although I do apologise for not having put my name down on the list of speakers.
4.42 p.m.
Viscount TRENCHARD: My Lords, let me begin by saying that I recognise the great sincerity with which everyone who has taken part in this debate has spoken. Nevertheless, I marvel, along with my right honourable friend, at the degree of certainty which noble Lords and Baronesses in the Labour Party have expressed that central policies carried out either by themselves or, as we are discussing mainly this afternoon, by their agencies, are the answer to the appalling difficulties that the country and British industry are in today.
The idea that the NEB could be a panacea to put right our vast industrial problems is, I think, a dreamland idea. No matter how high a calibre the individuals in that organisation have been, it is to over-estimate central human powers by factors of 100, 1,000 or even a million. I do not say that our predecessors alone —which I think the noble Lord, Lord Lee of Newton, suggested —are responsible for the situation in which British industry is today. I believe that in their years of rule they have certainly contributed, and contributed heavily. But, whether it is proper for a member of the Government to say so or not, I am absolutely clear that in recent years previous Conservative Administrations have contributed to the clobbering of British industry through price controls, personal taxes at a higher level than any of our major industrial competitors, differentials lower than those which exist in those countries, and a ruined profitability and cash-flow which I described in my lead-in speech.
Against that background, and against the success of other countries both in the past and even currently, on very different policies, I marvel at the certainty with which some noble Lords opposite cling to

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policies which we see as doctrinaire, in the same way as they see our policies as doctrinaire. We believe that it has been proved in Japan, in Germany, in the United States in the past, and in Britain in the past, that you should rely on harnessing the talents of all the people and not on yourself, and not on your specially chosen appointed panacea or agent.
The noble Lord, Lord Lee, mentioned a theme which the noble Lord, Lord Kaldor, and the noble Lord, Lord Balogh, have mentioned many times; namely, that we have been declining for 100 years and that that proves that the policies which have been effective in other countries are no good to us because we have tried them from time to time. First, I must say that our policies do not act immediately; they are not immediate panaceas and they are not magic wands. As the noble Lord, Lord Harmar-Nicholls, pointed out, nobody in this House, I hope, will assume that in seven months the decline of British industry could be arrested and sent on an upward course by a new policy.
However, I wish to deal with the 100 year decline as though it were inevitable and British, as though it assumed that the British were bound for decline willy-nilly and that the talent was not there. I do not believe that to be true. In the first case, we had the Industrial Revolution first, and nobody could assume that a small island of our size with our resources could hold on to the vast majority of the world market just because we moved first. Therefore, there was a gradual decline —as the noble Lord, Lord Balogh, knows as well as I do —through to the beginning of the First World War. However, we still were second only to the United States at that time in nearly all the economic measurements that count. Between the wars, as the noble Lord, Lord Balogh, and the noble Lord, Lord Kaldor, have said many times, we in fact made a recovery. Moreover, not immediately after the war, but especially between the years 1925 and 1937, we outpaced nearly every other industrial country in growth of productivity and competitiveness. Those times were in parts extremely harsh times, which no-body wants to see return. However, let us acknowledge the system under which we were working at that time.
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In Japan, which I visited recently, there has been 30 years of a policy of steep incentives to work rather than not to work; to work harder and obtain bonuses which apply to all and sundry; to take more responsibility and get substantially higher salaries; and to take risks. I am prepared to say that, if we had had such a policy for 30 years, we would not be talking about the Japanese work ethic today; we would be talking about the British work ethic, and our shares of the market would be rising everywhere.
I shall deal with some of the detailed points. The noble Lord, Lord Lee, suggested that we were hiding the "economy purpose" in regional expenditure, if I may put it that way. We have never hidden it. Public expenditure cuts have been a major part of the reason for the new regional policy. But I have said in this House before that I was extremely surprised to find the degree to which that policy could be altered with, in my view, little to no effect on the areas of major unemployment.
I shall not repeat all the arguments of the situation that I found in 43 per cent. of the country being treated as assisted areas; nor the fact that the largest quantum of assisted areas—the intermediate areas—had unemployment levels exactly the same as the national average. Therefore, it was not too difficult to make changes and yet to retain the purpose of regional expenditure, whatever view one takes of how successful that purpose has been in the past.
The noble Lord, Lord Lee of Newton, and others mentioned the profitability of the National Enterprise Board. I think that it is worth putting a fact or two into the debate. The figures I give are all on historical costing bases which, as noble Lords will know, are very much higher than that which most accountants and economists would regard as real profitability. In 1977, before tax, the figure was 11·4 per cent.; in 1978, it was 11·3 per cent. and for the first half of 1979 it was 8·6 per cent. The figure for 1979 as a whole will be released shortly. In total, this is not the steady progress which was required by the financial duties of the NEB. I do not for one moment want to say that the very talented people in the previous National Enterprise Board have not had some successes;

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but the overall situation is not clever and certainly plays a comparatively small part in any possible recovery of British industry as a whole.
I want to deal with one other awkward point because I think it should be dealt with. The noble Lord, Lord Lee, again referred to the statement of my right honourable friend the Secretary of State in the other place in relation to his answer to a hypothetical question, that in certain circumstances he believed that bankruptcy was the right answer. I must tell the House that having examined closely (with those very diligent and fair-minded civil servants who help one in the Department of Industry) what has happened in a number of cases when the alternative policies of rescue with the taxpayers' money or of allowing bankruptcy have been allowed to occur, there is certainly a clear set of evidence which suggests that regeneration is often quickest and most effective after bankruptcy.
The noble Baroness, Lady Seear, in one of her as usual and as we expect from her, devastatingly clear speeches which she makes without what the noble Lord, Lord Shinwell, calls the "encumbrances of notes" —and I never know how she does it —appealed to us to avoid partisan legislation. She asked us not to underrate the situation. I do not think that anyone has, least of all me in this House or even in this debate. The situation is appallingly bad for British industry. The noble Baroness, therefore, called for changes of a mammoth kind. I find it difficult to understand her faith or that of her party, with their traditions and beliefs, in conventional wisdom —in central form —being the answer to a mammoth task of this order.
I have industrial experience in a very large organisation, and with absolute sincerity I want to tell the noble Baroness that, given all the finance that was proposed, I do not believe that I could make a significant or a good contribution, certainly not one which would begin to be in line with the talents of the country as a whole, if they are encouraged and not controlled and discouraged.
Baroness SEEAR: My Lords, I hope I did not imply anything to the contrary, but will the noble Viscount not agree that
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advocacy of the NEB, with its spearheading function, in no way contradicts his other aims, with which I personally would be in most strong agreement, of encouraging the great mass of people in industry to go ahead as far and as fast as they can? They are not alternative policies; they are, surely complementary.
Viscount TRENCHARD: My Lords, we are not abolishing the NEB. We leave it with the mammoth task of having some 60 companies already and with roles to help others in the situations which I have described and which are in the guidelines. In all conscience, in my view that is as much as any high-powered organisation stands a chance of making a real success of.
Lord DRUMALBYN: My Lords, I want to ask for clarification about this, because I am bound to say that I have not found it in the Bill. I have to say "if that is so" as a starter, not expressing any doubt about it. If that is so, what kind of companies will the Secretary of State direct should be transferred from the NEB to the Government? I am afraid that I have not understood that.
Viscount TRENCHARD: My Lords, the major reason for the power to transfer is in relation to the Rolls-Royce case, where the Secretary of State's intention has already been announced and which will come into operation on the enactment of this Bill; and possibly in relation to British Leyland in the terms of which I spoke in my introductory speech. No other contemplations are in mind, but when altering legislation we do not believe that situations remain forever constant. Therefore, for the two cases concerned —one of which is certain and the other being tentative —we certainly need these powers.
Lord LEE of NEWTON: My Lords, will the noble Viscount agree that in, I think, July last or in the Budget his right honourable friend was insisting on the NEB finding £100 million in the course of this financial year? That cannot possibly apply to Rolls-Royce or Leyland. Of whom was he thinking when he said that?
Viscount TRENCHARD: My Lords, the noble Lord has raised a different point. The first point which we were

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discussing was, I thought, the continued role of the NEB, the companies that it has and the need for transferring one or possibly more of the large companies directly to the control of the Secretary of State. The NEB has a new task of maximising private investment and of disposing, as and when it can. In my introductory remarks I dealt with the amount of money expected; I have nothing further to add there, and I answered the noble Lord's question when he specifically asked me about it during his speech.
I should like to return for a moment to the question of Rolls-Royce, and thus, to the powers of the Secretary of State to transfer Rolls-Royce and possibly others to his direct control. Again, I say to the noble Baroness, Lady Seear, that it is not a question of believing in the Civil Service being skilled managers or directors of industrial organisations. Rolls-Royce is an enormous company. If we do not have the Rolls-Royce board right—and I believe that we have a very fine board —there is no hope for Rolls-Royce. To put another board of equally eminent gentlemen—and eminent gentlemen do not always agree the one with another—above the board of Rolls-Royce and between them and the Government, who in many of the activities of Rolls-Royce are inevitably involved in foreign trade and in finance as it is required at the moment, is an organisational nonsense. All my personal experience leads me to support the Government line enthusiastically. I believe that the Rolls-Royce move was right and that it is not a question of moving the company to the control of civil servants. Civil servants help Ministers to monitor the use of finance on behalf of the shareholders, to watch the progress and to watch the national interest and the national and taxpayers' liabilities. We do not want two boards of management, one on top of the other, for organisations of that size.
The industrial democracy point was raised by the noble Baroness and by others. Let me say, first, that the Government are not against the steady further movement of companies towards getting the whole of their force of employees to work as one towards a common objective. There are many different ways of doing this. I find Lord Lee's and others' views
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regarding the forcing of this on companies—as indeed the previous Administration were proposing in some of their laws—a bit in conflict with the marked reluctance to accept even a small part of the law regulating trade union affairs which exists in other countries.
I must finish off quickly. I apologise for the length of time, but there have been a number of interesting interventions. I should like to turn quickly to the points made by the noble Baroness, Lady Wootton, and to say that I too have been accused of not working for money alone, which is true. One gets thoroughly involved, and most of us in this House only notice at the end of the day that there is not much left. But this is a slow-acting policy. I do not believe that human nature has been changed radically in recent years —and possibly if it has, not for the better. I do not believe that deliberately ignoring in the rising generation the encouragement of incentive is a thing that we can continue to do, and to do so to a greater extent than other successful countries.
The noble Baroness put her tax points in a particular way, which is a perfectly fair way, but noble Lords know that in fact the vast majority of the Government's tax concessions, in terms of cost, were off the standard rate. It is true that the higher incomes because they pay more standard rate also get more tax concession. We still have a more egalitarian tax system; we still have more egalitarian differentials in this country than in most of our economic rivals. I believe that the Government's policies in this respect, and in respect of controls and other things which also blunt incentive, have to be given, as my noble friend Lord Harmar-Nicholls said, the full opportunity to work here as they have worked elsewhere.
These principles have lifted standards of living well beyond ours. The argument that standards of living have risen and that the situation has changed is true. There is much change in detail. But the principles of an economic organisation ignore basic human nature which can be motivated—it is not motivated only by money —by scope, excitement, freedom to try and "do its own thing", but also by incentive. Without these, I have seen economies, including our own, suffer slowly and finally to a devastating degree. We do not

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mean to let that happen in future. I beg to move that this Bill, as an important part of our policy, be given a Second Reading.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

BEES BILL
5.5 p.m.
The MINISTER of STATE,MINISTRY of AGRICULTURE, FISHERIES and FOOD (Earl Ferrers): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, that the House do now resolve itself into Committee.—(Earl Ferrers.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD AIREDALE in the Chair].
Clause 1 [Control of pests and diseases affecting bees]:
Lord HIVES Lord HIVES moved Amendment No. 1.
Page 1, line 9, at end insert—
("Provided that before any such order is made they shall consult the National Beekeeping Adviser and National Beekeeping Association.")
The noble Lord said: I beg leave to move the amendment in my name. The reasons for this Amendment are that I think it is unrealistic to expect the Ministry to be up to date with beekeeping developments. I think it is the duty of the associations to see that they are. In the past we have had valuable meetings, and I hope that by putting in these words they will continue and perhaps take place more frequently.
Besides disease there are other matters affecting beekeepers which provide grounds for discussion. For example, honey is imported into this country, usually in large containers, and when empty they are sometimes left lying around. The bees in the area find this honey and clean the surface off the drums. Foul brood disease is transmitted to bees by infected honey, and it was in making routine inspections of hives that this source of infection was discovered. May I make it plain that foul brood only affects bees and not human beings. When approached the importers immediately
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recognised the problem but, with the best will in the world, it is another job, and I think it would be better that we had an agreed method of removing this source as an infection to our home bees, either by a bee-proof pan or some other method.
Discussion could also take place on whether it is desirable for us to import bees at all; or perhaps we might have a bee policy with an agreed amount of imports. There are 250,000 queens reared annually in this country, and of that number 6,000 are imported. It is not a large proportion. I believe as a beekeeper that British bees are the best for Britain, and for these reasons I think these words should be in the Bill. I beg to move.
Earl FERRERS: I am grateful to my noble friend Lord Hives for explaining the purpose of his amendment. I am bound to say that, when I saw that my noble friend was going to seek to amend this Bill I could not restrain a slight smile from crossing my face, in that my noble friend Lord Hives was in fact seeking to amend the Bees Bill. I thought it was highly appropriate not only from a nomenclature point of view but also because, as my noble friend said, he is himself a beekeeper.
The purpose of this amendment is to ensure that we should carry out proper consultations with the experts in the beekeeping industry before making an order. However, there are some problems in this connection because the only individual of whom I am aware who could be described as a national beekeeping adviser is in fact an officer of the Ministry of Agriculture, and there is therefore no need for the Bill to specify that he should be consulted.
As regards the trade associations, it is our intention to continue the well-established practice, which we carry out now, of consulting the national beekeeping associations before making orders. At present these associations are represented by the Bee Farmers Association, the Council of the National Beekeepers Associations, which represents the British Beekeepers Association, the Scottish Beekeepers Association, the Welsh Beekeepers Association, the Ulster Beekeepers Association, as well as the Association of Bee Appliance Manufacturers. We would also consult the National

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Farmers Union. Therefore, I think that it might be inappropriate as well as unnecessary to make a special provision specifying the consultation which we would seek to make. I am not aware that any truly representative body of beekeeping interests has been ignored in past consultations.
While I understand, therefore, that my noble friend's desire is to ensure that the industry as a whole is consulted, it is only right for me to point out to him that we have every intention of doing this, but our intention is even more fulsome than that proposed by my noble friend because we intend to consult more people than he would oblige us to consult under the amendment, which would be limiting because we may wish to consult others. There is the further problem that although there is a beekeepers association, as far as I can understand there is no such thing as a beekeeping association, which is what is specified in the amendment, and therefore his amendment would oblige us to consult a body which does not exist, which might be described as a "ghost bee body", so I hope my noble friend will realise that we make the appropriate consultations.
He referred to the problem which can be caused by honey being imported and the containers being left around and he said, quite rightly, that the main danger is from foul brood. Honey itself is not a carrier of the varroa, which is the disease about which the Bill is not wholly but largely concerned. It is not carried by honey. American foul brood is the disease which is carried by honey and there have been in past years occasional instances of appliances being left around unwashed and uncleaned. We have sought the co-operation of the honey packers in this to ensure that full containers are kept where bees cannot gain access to them. The system has worked well, but the Bees Bill would allow us in the general powers of Clause 1 and in paragraph 7 of the Schedule to include measures for the cleaning and disinfection of these articles, should that prove to be necessary.
Our experience in the past has been that the normal process of consultation has brought a reasonable degree of adherence to basic hygiene. But my
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noble friend can remain content that if it should transpire that this is not enough, there would be under the Bill powers to enable an order to be made affecting the cleansing of articles which could give rise to infection. I hope, therefore, that on consideration my noble friend will agree that his amendment is covered by what we are already doing.
Lord WYNNE-JONES: Like the noble Earl, Lord Ferrers, I was delighted when I noticed that the noble Lord, Lord Hives, had capped the Bill in the appropriate way, and it is pleasant to find further interest being taken in it. It is common when the Government are given powers to deal with a subject like this to ask that they should consult with certain authorities, but usually—I think I am right in saying this—these authorities are established research authorities or authorities recognised as being the best people to advise in the matter; this comes into a number of conservation measures, for example. From what the Minister said, I gather there is no such clearly defined person as a national beekeeping adviser and that the only other relevant body is the Bee Farmers Association, which seems to be more concerned with the actual marketing of products and with looking after bees than with being a scientific body. If there is no such scientific body, I would agree with the Minister that it would be wiser not to have any further addition in the Bill of the type suggested by the noble Lord, Lord Hives. I do not know whether Lord Hives can help us in the matter and whether he has any specific scientific body in mind which could be brought in to advise.
Lord HIVES: I am afraid I do not have an answer to that question asked by the noble Lord, Lord Wynne-Jones. I must apologise to the Committee for the loose way in which my amendment has been phrased; drafting amendments is new to me and I must ask noble Lords to accept it as a beginner's mistake. In view of the reply of my noble friend Lord Ferrers and in view of the opportunity we have had to air the point, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.18 p.m.
Lord HIVES Lord HIVES moved Amendment No. 2:
Page 2, line 10, leave out from ("means") to end of line 11 and insert ("as may be specified in any order made under this Bill.
Provided that the Minister or the Secretary of State may, if it appears to him that the circumstances justify his so doing, direct that the bees, hives and appliances shall be treated in such a manner as may be specified by order").
The noble Lord said: As the wording of this provision stands, any beekeeper could be faced with the total destruction of healthy bees suspected of contact with diseased colonies, and I believe the words "as he thinks fit" are too loose and far-reaching and that it would be better to specify methods in an order, as has been done in the past, and leave the Bill uncluttered. It would also give an opportunity for the application to specific colonies of any treatments discovered by future research.
To give an example of the work which is being done now, on varroa in particular, it is possible to monitor hives by inserting a tray into the bottom of the hive. The tray is made up of nylon mesh attached over a wooden frame with white paper underneath. These trays are put in the hive in the autumn when the bees arc in cluster and bees that die fall on to this mesh. The varroa, if there are any on the bees, drop through on to the paper. If you monitor this regularly and take the tray out and look inside, you will see whether there are any varroa present; and if you see one, there will be 200 in the hive. It is possible that you can remove the queen and treat her individually with formic acid—you have to get it right, so as to be sure not to kill her, which you could do—and the varroa will drop off.
By fastening the queen in a special carboard box made for the job, and moving the hive out of the way, you can collect all the worker bees in a box and treat them in the same way. So there you are; you have a queen and you have workers. You are then left with the combs and the brood. Undoubtedly, they will be infected. The varroa gets into the brood, and it also sucks the blood out of the grubs in the comb. You can treat them with acetic acid, which of course is much stronger and a little more difficult to use.
Having saved the queen and the workers, you can burn the rest. You have achieved
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your purpose of saving a strain of bees which over many years have been carefully bred to fixed good qualities, and it would be a disaster for us to lose too many of these marvellous strains. That is an example of the reason why I think the amendment should be accepted. I beg to move.
Earl FERRERS: I found my noble friend's explanation quite fascinating. It is perfectly true that whatever the subject, when it comes to your Lordships' Chamber, there is always an expert on it, and I was delighted to hear my noble friend describe how he has seen varroa dealt with. In his amendment he was concerned virtually with two matters. First, he said that as it stands the Bill is too loose and, secondly, that treatment should be allowed, instead of just destroying the bees.
On the first part of the amendment, I think that it would be unnecessarily restrictive to have to lay down by order the method of destruction which should be used. Under my noble friend's amendment the words which would be left out of the clause are:
"as he thinks fit, or cause them to be so destroyed."
Instead my noble friend would wish the clause to read:
"any authorised person may destroy them by such means as may be specified in any order made under this Bill."
I would suggest that to lay down by order the method of destruction to be used would be too restrictive. The authorised people under the Bill will be people who are competent and who are trained to judge how best to do this, and they will in any case be operating under standing instructions, as they do now.
The amendment would also mean that no bees could be destroyed unless a method for their destruction was actually included in the order. This could be awkward if, for example, there was discovered a new disease which required fairly prompt action. It may well be that an order under the Bill will contain the method of destruction, as indeed the foul brood order makes it obligatory that bees be destroyed by fire. But I would suggest that it would be unnecessarily restrictive to specify by Act of Parliament, rather than by order, the method of destruction.

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With regard to the second part of the amendment, which refers to any subsequent treatment, particularly for varroa, this is a matter which is in fact already provided for in the Bill. I understand my noble friend's very reasonable request regarding this, but Ministers may by order
"make provision [in particular] with respect to any of the matters specified in the Schedule …".
If my noble friend were to turn to the schedule and look at paragraph 6, he would see that this includes provision for the treatment of bees and for cleansing and disinfection. It is by no means the intention that the powers of destruction shall be used against every diseased, or suspect, bee. The action taken will depend upon the disease in question, and it will be in accordance with expert opinion and in the light of developments in the control of bee diseases. Therefore I think my noble friend will find that the very reasonable permission which he wishes to see included in the Bill is in fact already included.
Lord WYNNE-JONES: I feel a little less happy with the noble Earl's reply on this amendment than with his reply on the previous one. I am not clear as to why he is not prepared to have the method inserted in the order, because it seems to me that to leave the method entirely to the individual who goes round to deal with a particular case, without there being any defined method, will mean that the position will be vague and uncertain. I should like to ask the noble Earl, for example, how many inspectors his department has who would be competent to deal with this matter, and who, on their own initiative, without any clear instructions laid down, would be able to cope with every situation?
It seems to be me that if at any time there were a large number of cases breaking out over the country it might be very difficult to get a sufficient number of highly qualified inspectors to go round and deal with each individual case. If, on the other hand, they were given clearly defined instructions, it would be much easier to send round people who were perhaps not quite so highly qualified. In other words, the situation depends very much on the staffing of the department; how many people there would be to cope
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with the situation if there was a wide-scale infestation.
Earl FERRERS: I think that the noble Lord, Lord Wynne-Jones, may be under a misapprehension. What I said was that there is permission to include the method of destruction in an order, but we think it right not to include such a method of destruction in an Act, nor provide for it to be forced into an order, for the simple reason that there may arise different circumstances or different diseases requiring different treatment. When that happens it is possible to make a new order in which the method of destruction can be included.
It so happens that in the example I gave of the American foulbrood order, the method of destruction is included in that order, and in that case the bees have to be destroyed by fire. But on some other occasions it might not be desirable to include the method of destruction in an order, and that is why we should prefer to keep the position open. The noble Lord, Lord Wynne-Jones, asked how many inspectors we have who are qualified to go round doing this work; the answer is that we have 60.
Lord HIVES: In view of my noble friend's kind explanation and of the other contributions we have had, I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
The DEPUTY CHAIRMAN of COMMITTEES (Lord Derwent): I must point out to the Committee that, if the next amendment is agreed to, I shall not be able to call Amendment No. 4.
5.31 p.m.
Lord HIVES Lord HIVES moved Amendment No. 3:
Page 2, line 18, leave out subsection (6).
The noble Lord said: I feel rather strongly about this amendment. It is a new introduction into legislation which I believe is unnecessarily restrictive. Again this is where I come back to making orders rather than putting it in the Bill. I think that non-payment in the case of compulsory destruction is better dealt with in orders made, thus leaving more flexibility in the future. That is my main reason for this amendment. I beg to move.
Earl FERRERS: I gather the other two amendments which are to follow this are based on the assumption that my noble friend's amendment is not pressed. On the assumption that he does not press his amendment, I think it would probably be better to leave the arguments as to compensation, for what they are, to one of the later amendments, if that is agreeable to the Committee.
All I would say to my noble friend on this particular amendment is that, by it, he would seek to permit compensation to be paid for the various classes of bee which are covered by the Bill, and he said that he would prefer to see that in an order rather than in the Bill. One reason why this provision was put into the Bill is because there has lately been a practice that where destruction of an animal or a person's property is undertaken and there is to be no compensation, then the Bill must say so. Having considered it quite carefully, it is the Government's intention and view that there should not be compensation paid in this case. Therefore, because compensation is not paid, it is necessary to include that fact in the Bill. That is why this provision was put into the Bill.
Baroness WOOTTON of ABINGER: I fully understand what the noble Earl has said, but when I look at the suggestion that he has made, that we might discuss compensation under Amendment No. 6, it appears to me that Amendment No. 6 could hardly be moved as long as the subsection which it is now proposed we should omit still stands. The Bill says:
"No compensation shall be payable in respect of any exercise of the powers conferred by subsections (3) to (5) above".
That being so, can we then put into the Schedule, if we wish to, a provision saying that payment of compensation is one of the matters to be considered? Am I wrong about that?
Earl FERRERS: I hesitate to say that the noble Baroness is wrong, but I think that she is, and the reason why is because she has looked at Amendment No. 6 and has omitted to look at Amendment No. 4 as well, which is the paving amendment to Amendment No. 6. If she takes Amendment No. 4, she will see that it will run:
"No compensation shall be payable in respect of any exercise of the powers conferred by subsections (3) and (5) above".
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Then Amendment No. 6 goes on to say that in fact it can be paid in the circumstances contained in subsection (4). The noble Baroness does not look at all convinced.
Baroness WOOTTON of ABINGER: I am quite sure the noble Earl is right, but it is very confusing.
Earl FERRERS: All I can say is that I did not put the amendments down, but I think the noble Baroness will find that Amendments Nos. 4 and 6 go together, which in fact permit payments to be made under subsection (4) but not under sub-sections (3) and (5).
Baroness WOOTTON of ABINGER: I think I have it.
Lord HIVES: I apologise for confusing everybody so much. I withdraw the amendment.
Amendment, by leave, withdrawn.
5.35 p.m.
Lord LUCAS of CHILWORTH Lord LUCAS of CHILWORTH moved Amendment No. 4:
Page 2, line 19, leave out ("to") and insert ("and").
The noble Lord said: In moving Amendment No. 4 it may perhaps be to the convenience of the Committee if we discussed at the same time Amendment No. 6, because, as my noble friend on the Front Bench has explained, Amendment No. 4 is the paving amendment to Amendment No. 6, which is the amendment which is going to deal with compensation. Perhaps I may just explain that Amendment No. 4 removes the word "to" in line 19 of subsection (6), so that the "no compensation" clause, subsection (4), would therefore apply to subsections (3) and (5). It is not the intention of my noble friends who support me (in particular, my noble friend Lord Malmesbury) that we should ask for compensation in respect of any bees that may be taken away from a hive for sampling or for testing. We feel that. here, any testing or inspection c sts should be borne by the beekeeper.
Similarly, we feel that there can be no justification for asking for compensation to be paid at the time of import if, at that time, the bees are found to be infected

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and then have to be destroyed. We feel there may be other ways in which the buyer or the importer can seek redress. We are therefore left with Amendment No. 6, which seeks to allow for compensation to be paid under the circumstances described in Clause 1 (4).
We feel that this matter has not been entirely fairly dealt with. On 25th October, on the Second Reading of the Bill in the other place, the matter was mentioned and at that time the Minister said that the beekeepers had just raised the question of compensation" clauses should be included. known, it was not raised until the beekeepers understood the Bill completely; and the noble Earl has explained the requirement, now current, that "no compensation" clauses should be included It is my understanding that hitherto the beekeepers felt that they had some protection under the Diseases of Animals Act 1950, which has been modified by subsequent Agriculture (Miscellaneous Provisions) Bills.
On 4th December, when this matter was raised in Committee in the other place—and, incidentally, that Committee spent only 28 minutes in dealing with the whole matter —it was there dismissed by the Parliamentary Secretary, who said —and I quote from col. 10 of the report of the Standing Committee proceedings:
"There has never been compensation for the destruction of bees, and the beekeeping associations could not reasonably have expected a new principle in the Bill".
When we come to our own debate on 28th January—and may I remind the Committee that the beekeepers had raised this point prior to 25th October—my noble friend Lord Ferrers said, at col. 634:
"There has never been any Government compensation for the compulsory destruction of bees and we do not think it appropriate to start it now".
The argument is not the same at all. The argument is that here is a new and very virulent disease. It is the beekeepers' wish and the Government's wish that this disease should not spread into this country.
It seems to me that, if we are to take the measures as proposed (and nobody has argued that these measures are not right and appropriate) for something which is not controllable by the beekeeper—that is, one can have a perfectly healthy colony
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which can be working quite well; and, due to some totally unforeseen circumstance brought in from outside, a colony may have to be destroyed, although it may not be diseased, because it may be thought to be within an infected area —it seems reasonable, in the light of what the bee industry does for the farming industry generally, that there should be some measure of protection.
We are not talking about small amounts of money so far as the beekeeper is concerned. If he loses his entire colony, then he loses a very fair share of his income. If he is a professional—
Lord DAVIES of LEEK: If I may intervene, as a layman and completely ignorant of all the facts, I am thrilled to learn as much as I am learning. When we are talking about compensation, can we be given some idea of the cost of a colony which may be destroyed through this disease?
Lord HIVES: You can buy a colony of bees for about £40.
Lord LUCAS of CHILWORTH: I think that one must understand what a colony is. My noble friend will correct me if I am wrong, but I understand that a colony is a working hive; so that if one has 50 hives all populated with bees, then one has 50 colonies. At £40 a time, that is quite a lot of money. It is my understanding that many amateurs, many hobbyists, as well as commercial beekeepers, would not exist on one colony or on two. The number of hives is probably something between 16 and 50; and the very big ones might go up to 120. If I am wrong, no doubt my noble friend Lord Malmesbury will correct me. We are not talking about small amounts of money which today could reasonably be expected to be borne by the beekeepers. Hitherto, American foulbrood and English foulbrood diseases have been borne by the beekeeper. At that time, the amount of money involved was considerably less.
I cannot understand why the general provision for compensation cannot be included; because if we say, as the Bill presently says, that no compensation shall be paid then the door has been slammed tight. I know that it will not be the Government's wish in the unhappy event

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of an outbreak of varroa that whole colonies should be destroyed, with there being no probability (let alone possibility) of their being replaced—and replacement, I understand, takes about two years.
Your Lordships raised this matter on Second Reading and the seven noble Lords who spoke specifically about matters within the Bill (excluding the noble Lord, Lord Shepherd, who spoke about the medical research organisation and the noble Lord, Lord Clifford of Chudleigh, who, I believe, spoke on something of a different topic) suggested that compensation might be more fair and reasonable. Since that time, since 25th October until we talked about it on 28th January, the National Farmers Union have given much greater consideration to this matter. They have said that they now feel that it is not only a question of livelihood but that farmers do depend to a significant extent on beekeeping to earn their living and cannot get adequate insurance to continue their livelihood in the event of the disease coming into this country.
That is the background to Amendment No. 6. As I have explained, it is necessary to make way for this so that, in moving Amendment No. 4, I stress to your Lordships that this is a very serious amendment although only a one-word amendment. The whole matter that we are about to discuss is extremely serious and, while one always appreciates the jocularity and humour that is present in this Chamber, I urge your Lordships to consider this with the seriousness I think it deserves. I beg to move.
The Earl of MALMESBURY: I should like to take this amendment and Amendment No. 6 together. To go back to the value of a colony, it is between £40 and £50, as my noble friend has said; but, in addition to the colony that is going to be destroyed, there is the hive with its frames, brood frames and so on, and they probably would cost up to £100; so that if you are going to destroy a hive you would also have to destroy the equipment, I understand, and you will be dealing with nothing less than £150 per hive per colony.
But in these amendments we are only asking for compensation against the parasitic mite varroa jacobsoni. As was mentioned at Second Reading, this disease
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has spread to Europe. It is now in France and there is alarm in every country it goes to. I think I am right in saying that in Germany they have appreciated the dangers of this disease and are providing compensation. I think that what must be one of the ways in helping to eradicate the disease—and one hopes it will never arise—is that one must have the full co-operation of all beekeepers. If there is no compensation, I would think that there would be a great temptation to hope that you have not got the disease. The disease can exist in a hive for several years. In the first two years, unless the beekeeper was pretty careful and employed the method that my noble friend Lord Hives mentioned, it could go unnoticed. The beekeeper (because some of them are in pretty remote places) might never have heard of that method or he might suspect if the colony became a little weak that he had got something else. He might put it down to the weather or to the spraying of crops or to a lot of other things. But I am serious in saying that I think the beekeeper must be given every form of help (and that that would include compensation) if this disease ever arrived.
Honey, of course, is a well-known product of the bees that we all enjoy. The most valuable work of a bee is in its pollination. I should like to emphasise this. I believe that the fruit industry is worth something like £100 million. The fruit set requirement is about 5 per cent. for top fruit, and an ideal set is 10 per Ćent. Without bees—which is the weakest link in the crucial flowering period—one could be affected by sprays, by weather, by fertilisers, and the pollination is the one thing which can help survive those other troubles. That is done by the bee.
I believe there are from between 5,000 to 10,000 colonies of bees which are moved to the fruit growing areas. So valuable is this that the fruit growers will pay for a colony. There are not nearly enough colonies at this moment. In fact, the fruit growers are competing for stocks of bees. It was mentioned in both Houses—and recommended—that the beekeepers should insure. I am not certain whether I am in order in saying this, but Bee Diseases Insurance Limited was mentioned. I have their latest balance sheet and the balance there is only £20,000. It is nothing; it could not start. I also have another letter from an insurance broker

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who is a member of the Insurance Brokers' Association, a Lloyd's broker. It is a long letter but it ends:
"We feel that although the underwriters have stated that they are prepared to consider the matter, there is not a very great chance of arranging cover under competitive terms."
I just wanted to emphasise that the hope of insuring is pretty remote, unless my noble friend sitting on the Front Bench has more recent news.
5.52 p.m.
Baroness WOOTTON of ABINGER: I hope that I do not have to declare an interest. I am a beekeeper, but an involuntary one because a colony of bees have established themselves for many years under the eaves of my house. They are a great nuisance and nobody will take them away. They prevent me from having the windows cleaned, and they cause me to be isolated indoors from time to time when they choose to swarm.
It seems to me that it would be reasonable to accept Amendment 6, when we get to it, and to accept the amendment under discussion now that paves the way, for this reason: neither of these makes payment of compensation obligatory; they merely make it possible. Surely they make compensation one of the matters under which provision may be made by order under Section 1. Do we really want to rule it out for ever in all circumstances? I should have thought it was sensible to have a provision that said that compensation may be made under certain circumstances and the order may arrive eventually. We surely do not want to leave it as it is now; that one may never in any circumstances—even if all the bees in the country were destroyed because there was yet another disease which was even more contagious—be able to get compensation for people whose whole livelihoods depend on bees.
Lord KILBRACKEN: As another beekeeper I should like to raise one point. The noble Earl, Lord Malmesbury, said that they were only asking for compensation in the case of bees that were lost due to a specific new parasitic disease being introduced. But I do not see anything in the Bill to that effect. I wonder what the position would be of beekeepers who lose colonies owing to the ravages of some of the ordinary indigenous diseases such
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as acarine disease and why it is that in one case a beekeeper would receive compensation but not in another.
Lord WISE: I should like to speak briefly in support of this amendment and to follow on from what the noble Earl, Lord Malmesbury, has said. It is of great importance not only to the beekeeper but also to the fruit grower. It has been established that of all the insects pollinating fruit blossom, approximately 90 per cent. are honey bees. I also understand that experiments have been carried out at Rothamsted to ascertain the efficacy of bees in pollination. Trees were covered and bees were excluded from them. In these cases, I understand that absolutely no fruit set. In other trees where bees were introduced the fruit set was some-where in the region of 38 per cent. I think that commercial fruit growers are quite happy, as the noble Earl, Lord Malmesbury, said, with somewhere between 10 per cent. and—if they are lucky—15 per cent. fruit set.
If we consider for a moment dessert apple growing, in 1978 there were some 18,800 hectares of dessert apples grown. This produced a gross income of some £58 million. Even a 1 per cent. drop in fruit set would decrease that figure quite substantially, possibly in the region of £1 million or £2 million. It could well make a difference between profit and loss. This illustrates the tremendous importance of bees to the fruit grower, for as yet I do not think that science has devised any alternative viable means of pollination.
If the worst happens and the measures proposed in this Bill do not prevent the spread of varroa to this country, the fullest co-operation of all the beekeepers would be vital to eliminate and eradicate this disease as it is so difficult to detect. Obviously, if the worst happens, compulsory destruction of infected bees and other bees which are likely to have been in contact with them is probably the only means of controlling and eradicating the disease, although as my noble friend Lord Hives has said, there may be possibilities of certain cures.
If whole colonies of bees have to be destroyed, surely in the interests of the fruit growers it is imperative that the area be restocked as soon as is expedient. Without compensation, this might well not

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be possible. Insurance companies might not insure against the disease. If they do, then in all probability the cost of premiums would be prohibitive. The unfortunate bee farmer who had lost his all could well be financially unable to restock and reequip. In my opinion, this would be a disastrous situation not only for the bee farmer but for all the other people dependent upon the bees for their livelihood.
That is why I strongly support this amendment. It is not seeking a compensation scheme for diseased bees at the moment; it is seeking to enable the Government to consider compensation should the need arise at any time in the future. Hopefully, this will never happen. With respect, I consider the amendment reasonable and indeed very necessary. I hope that my noble friend the Minister will agree to its inclusion in the Bill.
6 p.m.
Lord HIVES: I think that the noble Earl, Lord Malmesbury, hit one of the main things on the head: we have to combine together as beekeepers and to approach this sensibly. I am not in favour of this compensation. I have talked to my friends in my association. They were not in favour of it, either.
The point is this: the only way you are going to get varroa into this country is to find somebody bringing in an infected bee. The only person who is going to bring in an infected bee is someone who wants to bring in bees. Therefore I think it would be our own fault. For instance, I can go to East Midlands Airport and travel to Germany; I can pick up a queen bee and bring her back with me in my pocket within three hours. Whether she is infected or not I do not know, but I would be a fool to do such a thing. I should have to be more careful. If we are all more careful there is no reason why we should have it.
Lord DAVIES of LEEK: I should like to put a question which has just occurred to me. I have known things being carried by aeroplanes unintentionally. Cannot bees get into aeroplanes? A German bee could get into an aeroplane and land here without anybody knowing that it was infected.
Lord HIVES: The point is that somebody would have to help the bee when it got here, because unless a bee can find congenial surroundings when it gets here it will die.
Lord DAVIES of LEEK: The chances are not very great!
Earl FERRERS: I rather fancy that if it was a queen bee which got into the aeroplane, followed by all the others, the occupants of the aeroplane, including the noble Lord, Lord Davies of Leek, would get off fairly sharply! I am grateful to my noble friends Lord Lucas of Chilworth and Lord Malmesbury for putting down these amendments. I recognise that this is a point about which people feel very strongly and it is a point to which, as my noble friend Lord Lucas said at Second Reading, everyone, apart from one person, had referred.
It is important, and I understand that people may feel a sense of grievance where circumstances arise in which their stock could be destroyed and they are not compensated. As my noble friend Lord Wise said, it would be very difficult for some people to have their hives destroyed and then to be obliged to start up again, which would be an intolerable expense for them. I agree with my noble friend Lord Malmesbury, who knows far more than I do, when he said that the cost of a colony of bees is about £50. I think he was also right when he said that the cost of a hive was £100 to £150, though I daresay that my noble friend Lord Hives might rate them a little higher than that.
The point about compensation for destruction is that it would be the colony of bees that would be destroyed, and the combs, but not the hives themselves. I understand this particular mite can live only on the bee and if the bees themselves have been destroyed the mite cannot live. A period of about a week or so without any bees being in the hive should itself render the hives uninfected. However, there have been a number of arguments put forward in favour of paying compensation. It has been claimed, quite correctly, that animals which are destroyed—for example, because of foot and mouth disease or swine fever—attract compensation. My noble friend Lord Malmesbury

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suggested that beekeepers might hide their disease if no compensation was available. Again, I think it was my noble friend Lord Malmesbury who said that at present only diseased bees are destroyed, but if varroa got into the United Kingdom, clean bees would be destroyed too.
If one takes these points one at a time, it is true that animals attract compensation when they are slaughtered but, on the other hand, plants which are destroyed do not generally attract compensation. In other words, it is not a general principle that destruction of an article necessarily invites compensation. I do not believe that beekeepers themselves would deliberately hide the presence of a disease because that would be a very shortsighted and selfish attitude. It is a fact that bees are exposed to infection although ostensibly healthy; a hive may look healthy even though it is in the early stages of disease, and therefore it may be necessary to destroy some hives which are apparently healthy but which in due course would possibly show signs of the disease.
The destruction of apparently healthy material without compensation does happen in the plant health field. I could give the example of white rust in chrysanthemums, where it is possible to destroy vast quantities of chrysanthemums with this disease and there is no obligation to pay compensation for that. We have considered this very carefully and I would put the position to your Lordships in this way. This is a Bill which was asked for by the Beekeepers' Association—I mean by that not one particular facet but by beekeepers as a whole—because they were urgently concerned about the possibility of bringing this disease into the country. They wanted legislation to stop that. So we had discussions with the beekeepers and decided to bring in the Bill in order to meet their request. At that time there was no obligation suggested that the Government or the Exchequer should underwrite the possible charge that this might bring. I really think it would not be right at this stage to say: "Yes, the Government will, or might, change a policy which has been that bees, like plants, should not carry compensation, and that we should change this because of this particular Bill."
I do not believe it is right at this
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juncture for the Exchequer and public funds to carry this liability, I think it is inevitably something which the industry itself must carry. Whether it does that by insurance or by providing its own funds must be a matter for the industry. I think it is perfectly possible to arrange for disease insurance. My noble friend Lord Malmesbury has referred to the fact that this is being considered by the beekeepers. What the beekeepers will do is, of course, up to them, but I do not think it would be right at this stage to impose a liability on public funds for this. However meritorious the argument is—and I see it has a great deal of persuasion in it—I think it ought to remain the responsibility of the industry.
6.9 p.m.
Lord WYNNE-JONES: The noble Earl has put the case against the amendment on the grounds, first of all, that bees on destruction have never been protected in this way by any form of compensation and, furthermore, that plants are not protected. But plants belong to an entirely different part of the whole of our life cycle and they are dealt with in quite a different way from animals. The bee, after all, is an animal, and consequently one must compare it with other animals and not with plants. There may be an argument for looking at plants as well, and I have no doubt that the noble Lord, Lord Skelmersdale, would be able to give us some persuasive arguments about plants. But we are not at the moment discussing plants; we are discussing bees.
I think the noble Earl really is being a little disingenuous when he says that this is a Bill introduced by the beekeepers. It is a Government Bill. It is not a private Bill. It does not come before us as a private Bill. It would be dealt with in an entirely different way if it were a private Bill. It has come directly to us from the other House, where it was introduced and supported by the Government. It comes to us now as a Government Bill and, that being so, we surely have to ask ourselves whether we should agree with a Bill which breaks what seems to most of us a manifest condition of equity and justice, which is that where, by Government action—not by the individual action of the beekeeper—colonies are destroyed there should be compensation. It seems an ordinary principle of

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equity that this should be done. It is not being done by the beekeepers of their own choice. It is being done because the Government Bill tells them that that is what will happen, and therefore there should be compensation.
The noble Earl, Lord Malmesbury, has also pointed out that it is prudent for us to give compensation, because it makes it much more likely that the beekeeper will watch matters and will let it be known when there is infestation. We realise, as we have been realising very clearly throughout this dicussion, that it is not just a matter of bees and honey; it is also a matter of the pollination of fruit. In other words, it is something of great importance for the whole country, for our fruit growing and for many other things. Therefore, I should have thought it was reasonable, sensible and just that compensation should be paid. So I hope that your Lordships will pay attention to this amendment and agree that it improves the Bill and makes it better, more workable and more just.
Baroness FAITHFULL: Before the noble Lord sits down, may I ask a question? If he describes the bee as an animal, may I ask whether compensation is paid by the Government if there is foot and mouth disease in other animals?
Lord WYNNE-JONES: I understand that in the case of foot and mouth disease compensation is always paid. I think it is reasonable that it should be paid. I should have thought there was little doubt that paying compensation helps to keep down foot and mouth disease, to keep it under control and to prevent it from spreading throughout the country—it is not endemic in this country as it is in many other parts of Europe—and, in addition, it is a just and fair thing to do.
Lord SKELMERSDALE: I must agree with the noble Lord, Lord Wynne-Jones, when he attacks my noble friend on the Front Bench for comparing bees with plants. Perhaps my noble friend is trying to pull the cotton grass over our eyes, because the two things cannot possibly be comparable. We seem to be getting from the general to the particular in the last few speeches on these amendments. But were I in any position of responsibility, I would not give compensation to anybody, for the simple reason that I support my
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party's policies in trying to control what one pays out from Government funds in such a way. However, this amendment has nothing to do with that. This amendment is to the effect that the Government "may" pay at some time in the future, for some unspecified period in the future. I do not believe that the sorry state that we are now in will continue for ever.
I do not know who it was who said that it was better to live in hope than to arrive. But I, as a very small businessman, am permanently living in hope and I do not suppose that I ever shall arrive, until my dying day. However, that does not stop me from being an optimist and I cannot help feeling very strongly, as my noble friend Lord Lucas has said, that not only to slam the door but to bolt it with heavy gauge padlocks is a great mistake at any time. It would not be unreasonable to ask my noble friend on the Front Bench to say that he will think further about this amendment, which, after all, is purely and simply an enabling amendment, the like of which Governments of all complexions have accepted on very frequent occasions over a great many years.
Lord MOYNE: In view of the over-whelming weight of argument in favour of the amendment, I wonder whether the Government might simply think of accepting it. As the noble Lord, Lord Skelmersdale, has said, it is purely permissive and it seems to me that everybody in the Committee favours the power being there.
Lord STANLEY of ALDERLEY: Before my noble friend on the Front Bench replies, I should like to take him up on one point. He said it is up to us in the bee industry to insure ourselves and to look after our own financial arrangements. I took the precaution of ringing up a main Lloyd's broker, like the noble Earl, about insurance. He said to me that unless there was a Ministry compensation scheme, he would be most loath to do any form of insurance. As those who have been unfortunate enough to have TB in cattle—as happened to me—will know, you can insure against that very easily, because there is a quantifiable risk. I shall not go on with this subject, but the snag is that we cannot insure until my

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noble friend has first done something. He may not like it but, unfortunately, that is the position.
Lord KILBRACKEN: Are the diseases that are threatened in this country so infectious that if they appeared in one colony it would be prudent and advisable to destroy all the colonies in a particular apiary, or might it be the case that only one colony in an apiary would be destroyed?
Earl FERRERS: If I may first reply to the question of the noble Lord, Lord Kilbracken, the answer is that the order would specify that colonies of bees within a certain area of an outbreak would be destroyed, and there would be discussion with the industry as to the terms of the order. Your Lordships have made it perfectly clear that you are very keen that some form of compensation should be put into the Bill—
Baroness WOOTTON of ABINGER: Not actually compensation, but that it should be made permissive.
Earl FERRERS: I take that point. The noble Lord, Lord Wynne-Jones, said that I was disingenuous. He said that I had said that this is a Bill introduced by the beekeepers. I never said anything of the sort. He said that it is not a private Bill. I never said it was. He knows perfectly well that it is a Government Bill and that the Government have introduced it at the behest of the beekeepers. We went along and discussed it with them and they said, "We want to keep the diseases out", and we said, "Yes, we, too, want to keep the diseases out". There was discussion of the terms of the Bill and the Government said "Yes, we will give Government time to this Bill," for one reason—because there is not going to be an Exchequer involvement. That is the reason why the Government were prepared to give time to what might otherwise have been a private Bill. The noble Lord, Lord Wynne-Jones, now comes along with everybody else and says "Because you have introduced the Bill, let us slide a compensation provision into it". This puts a very different complexion on the Bill. If at the outset there had been a
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Government liability to underwrite the Bill, the Government would not have undertaken this. I am bound to make this point perfectly clear.
Your Lordships know full well that we are going through a fearful financial crisis, with the Government having to cut down on all forms of public expenditure. If we were to go along to our friends at the Treasury and say, "Come on, will you underwrite the beekeepers?", I imagine that the answer would be fairly spicy. It was because there was no Exchequer involvement and no public liability that the Government were prepared to undertake this. At that time, the beekeepers did not say, "If you do this, will you, the Government, under-write it?" This has come out since the Bill has been introduced, for reasons which we know because they are specified in the Bill. I do not blame them for mentioning this.
All I would say to your Lordships is that we have a liability to protect public funds. Of course there is always an argument why public funds should be better expended and why it should be fairer and more just. I accept those arguments and understand the reasons why people think that if bees are destroyed there should be compensation, but I just do not think that it is right at the moment to suggest that we should do this—nor, indeed, that it is fair to put this onus upon the Government when they have introduced a Bill specifically to help the beekeepers in what they want. My noble friend Lord Skelmersdale said—and I thought that this was fairly tough stuff—that the Government have slammed and bolted the door. We have not slammed and bolted any door. All we have done is to introduce a Bill which the beekeepers wanted. I should have thought that that was opening the door.
I would say this to your Lordships: I can see the arguments which are put forward, but if your Lordships were to impose upon the Government a need and an obligation, even at some unspecified time in the future to underwrite this, I fear the Government would lose interest in the Bill. I am bound to tell your Lordships that.
When my noble friend Lord Skelmersdale said at the very beginning that this

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was a bit absurd because plants and bees just are not the same thing, all I would say to him is that I quite agree. I would say also that plants, bees and cows are not the same thing, either. If you are going to use the argument that because cattle are slaughtered and compensated therefore bees should be slaughtered and compensated, I am perfectly entitled to say that because plants are not compensated when they are destroyed then neither would we think it right for bees to be.
I hope that your Lordships will not press me too hard on this amendment. I do understand the arguments and I appreciate the reasons which your Lordships have given but I hope that on balance your Lordships will feel it might be more prudent to leave the Bill as it is —in the way that it was when it was first discussed and arranged with the industry concerned.
Lord LUCAS of CHILWORTH: We have had a rather unprecedented session on this Bill which belies its smallness and certainly emphasises its importance. Until my noble friend Lord Ferrers made his last few remarks I was thinking that perhaps it might be as well, having aired it, to leave it be. However, he himself has rather determined my attitude, because I think it is totally and absolutely and grossly unfair that he should stand here and say that because of a variety of reasons, notably the Exchequer, your Lordships in Committee may not do the job they think they should be doing. I would challenge him right now: what do Her Majesty's Government think the Exchequer liability might be? Have they no faith in the measures which are set out in this Bill and which are going to be implemented by order at some time? Do they fear that the disease may slip through? If so, perhaps we might look to them for not having provided adequate measures for which there is power in this Bill, as a result of which healthy stock has been destroyed and a great amount of farming industry has also been lost.
We have spent a lot of time upon the matter and we have brought forward arguments which the noble Earl the Minister accepts as arguments but which
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he cannot agree to, for his particular reasons. I think this is the opportunity to offer the other place a second look at this matter of compensation—its liability —in the light of what some experts have said.
Earl FERRERS: Just before my noble friend presses his Amendment, I wonder whether he will permit me to say this? I never said that your Lordships were not entitled to move this Amendment. Of course I did not. Your Lordships are entirely entitled to move it. What I said was that I did not think it would be very easy for the Government to continue a Bill which had this kind of thing attached to it. If your Lordships wish to include it, then of course your Lordships are entitled to do so. The last thing I would do would be to say to my noble friend Lord Lucas of Chilworth, "No, you mustn't do this." Of course it is up to your Lordships what to do. However, if I may respectfully say so, I think that your Lordships would be ill advised, with the interests of the beekeepers in mind, to do this.
I accept the strength of the argument which has been put forward and I accept also the strength of the argument of the noble Baroness, Lady Wootton of Abinger, who said that if you put this in it does not oblige the Government to pay; maybe they never will pay but it just gives a Government the ability to consider it at some time in the future, and what I shall do, if I have the agreement of your Lordships, is to look again at that point. I cannot give an undertaking that we would necessarily accept it. I realise the strength of feeling that there is and I will certainly look again at the point if my noble friend Lord Lucas of Chilworth would care to leave it like that.
Lord LUCAS of CHILWORTH: I beg to move the Amendment.
6.27 p.m.
On Question, Whether the said Amendment (No. 4) shall be agreed to?
Their Lordships divided: Contents, 33; Not-Contents, 25.

CONTENTS

Beaumont of Whitley, L.

Kilbracken, L.

Skelmersdale, L.

Blease, L.

Killearn, L.

Stanley of Alderley, L.

Brockway, L.

Kinnoull, E.

Stewart of Alvechurch, B.

Brooks of Tremorfa, L.

Llewelyn-Davies of Hastoe, B.

Stewart of Fulham, L.

Bruce of Donington, L.

Lovell-Davis, L.

Stone, L.

David, B.

Lucas of Chilworth, L.[Teller.]

Taylor of Mansfield, L.

Davies of Leek, L.

Malmesbury, E. [Teller.]

Wallace of Coslany, L.

Feversham, L.

Moyne, L.

Wigoder, L.

Grey, E.

Northfield, L.

Wise, L.

Hale, L.

Ponsonby of Shulbrede, L.

Wootton of Abinger, B.

Houghton of Sowerby, L.

St. Davids, V.

Wynne-Jones, L.

NOT-CONTENTS

Auckland, L.

Hives, L.

St. Aldwyn, E.

Bessborough, E.

Holderness, L.

Sandys, L. [Teller.]

Denham, L. [Teller.]

Hornsby-Smith, B.

Strathclyde, L.

Derwent, L.

Hylton-Foster, B.

Suffield, L.

Drumalbyn, L.

Lauderdale, E.

Tranmire, L.

Faithfull, B.

Long, V.

Trefgarne, L.

Ferrers, E.

Lyell, L.

Tweedsmuir, L.

Greenwood of Rossendale, L.

Mottistone, L.

Vickers, B.

Hailsham of Saint Marylebone, L. (L. Chancellor.)

Resolved in the affirmative, and Amendment agreed to accordingly.
6.35 p.m.
Lord HIVES Lord HIVES moved Amendment No. 5:
Page 2, line 29, at end insert—
("( ) The Minister or the Secretary of State or any order made by them under this section may grant exemption from the operation of this Act for bees kept for research purposes and for the preservation of a gene pool.").
The noble Lord said: This amendment is about the provision for research. If the requirements of this Bill are carried out, no provision will have been made for research into diseases and the probable preservation of genetic material. As I have said before there are many developments going on into the treatment of bee diseases, but in order to further the work and to be ready for any other disease which may arise it is necessary that this should be inserted into the Bill, so that research work may be done on infected material without it being affected by these provisions. I beg to move.
Earl FERRERS: Surprise, surprise! This does not seem to provoke quite so much interest or controversy as the last amendment, but I can tell my noble friend that if we were in fact to accept this amendment it would make quite a difference to the Bill. There may well be circumstances in which bees kept for research purposes or for their genetic characteristics should be dealt with somewhat differently from other bees. It is
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not our intention to stop very desirable research and development work from being carried out. I am glad to tell my noble friend that this situation can be dealt with by order under the Bill as it now stands.
One needs to look at Clause 1(2)(c). Your Lordships will see that there it is provided that orders may make different provision for different cases. As an example, the exemption from the provisions of the Foulbrood Disease of Bees Order 1967, which will in fact continue in force under the Bill, is given at present in the Orders Article 12 to
"persons keeping bees for research subject to the issue of a licence",
and there will be no problem in making similar exemptions for other necessary research into genetic work on bees.
My noble friend's amendment would remove bees for research purposes totally from the Bill. We would prefer to remove them under an order, which can be far more precise in stating what bees and what areas and for what purposes they can be exempted. To exempt under the Bill would be a blanket countrywide exemption, whatever the circumstances. For instance, it would remove the right of entry and the right of examination; and if the amendment were to be accepted—and I wonder whether it will be accepted in the light of your Lordships' last decision—and an exemption were made, anyone carrying out research could im-

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port bees from countries infected with Varroa and the Bill just simply would not apply to them. I cannot believe that that is the wish of my noble friend. The wish that I think he has in mind is in fact covered under the Bill, because an order can be made exempting those bees used for research purposes; and I hope that will satisfy my noble friend and the noble Lord, Lord Wynne-Jones, as well.
Lord WYNNE-JONES: I am sure that the noble Earl will be glad to know that in compensation I would not wish at all to support this amendment. It seems to me that the Bill, which started as quite a good Bill, is now being made into an excellent Bill. Therefore, it would be quite wrong for me to remove the compensation which he would wish to have.
Lord HIVES: Perhaps I may say to my noble friend that in future when I propose amendments I will be a little more careful and read things a little more carefully before I write them down. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1, as amended, agreed to.
Clauses 2 to 4 agreed to.
Clause 5 [Short title, commencement, repeals, transitional provisions and extent]:
On Question, Whether Clause 5 shall stand part of the Bill?
Lord SKELMERSDALE: Since I have this opportunity, perhaps I may ask a question about Clause 5, which has to do with enactments repealed. I think it was on 25th March this year—I have not checked my facts so they may be a little hazy as to the date; we were all rather otherwise engaged—that an order was laid before Parliament which I think was passed. It was the Bees Import Order, which was laid under Section 10 of the Agriculture (Miscellaneous Provisions) Act 1954. This order currently has the force of law, as I understand it. I also understand that, under subsection (3) of Clause 5, Section 10 of the 1954 Agriculture (Miscellaneous Provisions) Act ceases to have effect. Therefore, I have two questions. One is, what is the validity then of the order? Secondly, since so far as I can see the order
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has exactly the same effect as many parts of this particular Bill, would it therefore not be appropriate to withdraw the order?
Earl FERRERS: I think my noble friend will find that when this Bill becomes an Act it will in fact subsume the order which has gone before.
Claues 5 agreed to.
Schedule [Specific matters with respect to which provision may be made by orders under Section 1]:
Lord LUCAS of CHILWORTH Lord LUCAS of CHILWORTH moved Amendment No. 6:
Page 5, line 35, at end insert—
("9A. Payment of compensation for bees or other things subject to control destroyed in accordance with section 1(4).").
The noble Lord said: Since your Lordships have accepted Amendment No. 4 and we have discussed the substance of Amendment No. 6 at quite sufficient length, it leaves me only to beg to move the amendment standing in my name.
Earl FERRERS: In view of the decision your Lordships took on Amendment No. 4 I would not object to this.
On Question, amendment agreed to.
Schedule, as amended, agreed to.
Title agreed to.
House resumed: Bill reported with the amendments.

EAST SUSSEX BILL [H.L.]
Read 2a; and committed to a Select Committee.
FRIENDS MEETING HOUSE (REIGATE BILL) [H.L.]
Read 2a, and referred to the Examiners.
SALVATION ARMY BILL [H.L.]
Read 2a, and referred to the Examiners.
SOUTHERN WATER AUTHORITY BILL [H.L.]
Read 2a, and committed to an Unopposed Bill Committee.