HL Deb 18 June 1980 vol 410 cc1152-84

Debate continued.

4.27 p.m.


My Lords, from these Benches I should like first to thank the noble Lord, Lord Boyd-Carpenter, for having introduced this debate, and I am especially glad that he has so framed his Motion as to enable us to approach the problems to which he has called attention in a constructive way and to move from the particular to the general—and both those things I shall endeavour to do. Let me say at once that I agree with him that the principle of comparability as applied by the Clegg Commission should be dispensed with, in my view at the earliest practicable moment, for it has contributed considerably to the present excessively high rates of inflation. Although last year it appeared to provide us with a convenient way out of our problems in the public services, in reality it has proved to have been just a way of postponing our difficult decisions and of shelving awkward problems, and, meanwhile, those problems have not gone away.

Having said that, I am bound to say, along with the noble Lord, Lord Houghton of Sowerby, that I was a little disappointed that the noble Lord, Lord Boyd-Carpenter, did not have more to say as to where we might go from here; and, if I may say so with just as much respect to the noble Lord, Lord Houghton, himself, I do not know that I learned all that much more from him. It may be that the noble Lord, Lord Vaizey, who is to follow me, will say much the same. We shall see.

My Lords, to come to the point, how should we, in Lord Boyd-Carpenter's phrase, review the machinery of the application of the principle of comparability? First, I believe that all the main elements in society which have a stake in this problem should be consulted about it urgently, as the Motion demands; and that means representatives of employers and of trade unions, and possibly others. I fully realise that the prospect of this actually happening must be remote indeed, for the Government seem unlikely to invite the unions to express a view on the subject and, for their part, the TUC already appears to have rejected overtures, even from the CBI, never mind the Government, to discuss broader questions of pay determination. But in my view the Government would have a much better chance of gaining a wider acceptance for whatever action they decide to take in this field if they, first, were to offer to consult with the unions not only on this and other aspects of pay policy but also on prices and employment, since all these questions are inextricably linked together. If they do not, the unions will feel left out of it—and they will, in my view, have a justifiable grievance and will then be even less willing than some of them now appear to be to acquiesce in limitations being placed on the so-called right to free collective bargaining.

The Government have nothing to lose by offering at least to talk with them and much to gain from a consistent attitude. They already concede that employers should disclose more information to their employees and give them more influence over decisions affecting them, but they seem reluctant to apply this principle to their own conduct. When the Government have done so, as, most notably in the case of Mr. Jim Prior over the Employment Bill, it has had the effect of reducing opposition to the action ultimately taken. In that instance it certainly evoked a response from me.

In an entirely different field, the achievement of the noble Lord, Lord Carrington, and of the noble Lord the Leader of the House in obtaining a genuinely acceptable settlement in Zimbabwe stands as a triumphant vindication of the same principle. This point enables me to compliment, if I may, from these Benches, the noble Lord, Lord Soames, and his wife on the well-deserved awards that they have received in that connection. I cannot think why the Government do not approach the problem of pay determination in this way. Nobody can take from them the right to make their own decisions in the end.

Secondly, in tackling the problems raised in the Motion of the noble Lord, Lord Boyd-Carpenter, I believe that the Government should think very carefully before they jettison altogether the existing machinery for settling pay claims in the public services. By that I do not mean that the present commission should be retained in its existing form. Both major political parties have been quick to dispense with such organisations as the Prices and Incomes Board and the Relativities Board, only to replace them later with other organisations fulfilling very much the same purposes.

It seems to me that what the country now needs, more urgently that when I first made this suggestion in your Lordships' House nearly two years ago, is a single independent body in which all those concerned repose confidence instead of the various bodies of which we already have been hearing this afternoon from those more experienced in these matters than I am. Its members might be appointed partly by the employers and trade unions, but partly also by the Government from among people wholly independent of employers and trade unions but acceptable to their representatives. The maintenance of the independence of that body should be guaranteed by commitments entered into not only by the Government but by the main Opposition parties. This would at last achieve that continuity of policy which in recent years has been conspicuously lacking and damaging to our industrial and economic performance.

What should be the functions of such a body, were it to come into existence? First, it seems to me it could determine the pay of people employed in certain key occupations which are vital to the support of life: specifically, doctors, dentists, firemen, the police and those serving in the armed forces. I do not think that the pay of those concerned should invariably have to be related to the average levels since the entrenchment of such a criterion would perpetuate an element of inflexibility in the procedure which might be regretted if, for some now unforeseen reason, it proves desirable later to apply a different criterion. And there would have to be general agreement between the political parties that the findings of this body, in all circumstances and irrespective of income policies, would be implemented.

The people whose pay would thus be determined would not be required to forgo their right to strike as a condition precedent for this special treatment since in the case of some of them they have no such right to forgo while others are unlikely to prove willing to give such an undertaking. The assumption would simply have to be made therefore that, in return for the privilege thus conferred upon them, all such people would in future act responsibly. I should be happy if the nurses, too, could have their pay determined in the same way. However, they are now represented not only by the Royal College of Nursing but also by the National Union of Public Employees and by the Confederation of Health Service Employees. And alas! the present attitudes of those organisations do not lead me to think that they are likely to surrender pay bargaining rights in the case of only one particular category of their membership. The same consideration applies with even more force to people such as the power workers. But once a procedure of the kind which I have outlined had been successfully established for some categories, there is no reason why it should not be extended to include others where this proves practicable.

Next—and here I should like to try to build on something which the noble Lord, Lord Nugent of Guildford, had to say in the debate on the Government's monetary policies last week—the independent body that I have been advocating could make recommendations as to the guidelines which the noble Lord, Lord Nugent, suggested should be defined for pay settlements throughout the public sector where in every case the Government are directly or indirectly the employers; and particularly in the national utilities such as electricity, gas and water which are virtual monopolies on which life itself depends. The noble Lord, Lord Nugent of Guildford, said that in his view the objective should be to achieve pay settlements a few points below the rate of inflation. In my view, it should be a good few points below that rate.

He advocated marginally more favourable treatment for national utilities, first, in recognition of their literally vital importance and, secondly, to encourage the idea that the nation expected the workforce in such undertakings to keep them going even at times of industrial dispute. That recommendation made a lot of sense to me as a move in the right direction. If it could be linked somehow with the suggestion that I have sought to make, then that might bring nearer the time when members of the unions concerned would be willing to commit themselves to accept binding awards from the independent arbitrator about whom I have spoken.

One of the great difficulties that, in my view, must then be faced is that the public and private sectors cannot altogether be separated. Here I am very much with what the noble Lord, Lord Houghton of Sowerby, had to say and I draw a certain conclusion which will be no surprise to your Lordships. A good case in point of that link is road transport which has one foot in each of the two sectors. It is partly considerations of that kind which lead me to favour a more general incomes policy. If the noble Lord, Lord Boyd-Carpenter, considers that too woolly a phrase, I am willing to go with him in calling it, "a matter of management of pay", or as I have often enough called it, "pay determination", so long as we all understand that it amounts to very much the same thing.

It leads me also to take the view that I expressed in the debate we had on productivity two weeks ago, that there is need in discussion between representatives of Government, employers, trade unions and possibly others to get as near as possible to agreement on two points. The first is on long-term procedures for pay determination, such as the much shorter pay round, and for negotiations in the public sector to take place at the end so that they follow those in the private sector where market considerations have to apply. The second concerns broadly what the country can afford by way of overall pay increases, an essential element in that process being that it should be so conducted as to enable the public at large to gain a clearer understanding of what is at stake before the Government reach their decision.

The noble Lord, Lord Thorneycroft—and I am sorry he is not in his place today—in last week's economic debate said in colourful language that the idea of fixing a structure of wages which meets the infinite complexity of the industrial and commercial scene in this country is beyond all human belief. But I am not suggesting anything as extravagant as that. Nor was my noble friend Lord Banks when he spoke on this theme last week, and it was to him that the noble Lord, Lord Thorneycroft, was then replying.

There is widespread agreement that inflation is the British public's enemy number one, and that pay increases far in excess of any improvements in productivity contribute greatly to it. Faced with this situation, let us apply the most practical test that I can think of: What are our large manufacturing companies now actually doing about this? I will tell your Lordships. They are making even more employees redundant. They are reducing investment. They are conceding pay increases of up to 20 per cent. or more because they think they stand to suffer less that way than from the losses that would otherwise result from industrial action of one kind or another.

The unions, for their part, are intent on obtaining for the dwindling number of their members in employment increases to match inflation. The question we need to ask ourselves is: Who cares about the rest? In my view, it is up to the Government, and ultimately to Parliament, to safeguard the interests of the community at large by means of a policy for pay that makes more sense than the present procedure.

If we could one get cracking on some form of concerted action of this kind—who knows?—we might soon be able to return to a more rational way of conducting our affairs, particularly in the public sector, in which increases in pay would no longer depend on the crude power of muscle and monopoly but on factors that are more relevant to improve industrial performance such as responsibility and skill. Productivity and shortage of labour are very important points to which the noble Lord, Lord Boyd-Carpenter, drew attention.

Otherwise, it looks as if we shall continue to be stuck with a policy of which, maybe, not the purpose but the effects will be further contraction of demand, more bankruptcies and fewer jobs. As I tried to say in the debate on productivity two weeks ago, it is the attitude and behaviour of people which will eventually determine the outcome. Excessive reliance on the impersonal market forces of monetarism is divisive in dealing with fellow countrymen at arm's length. By contrast, a renewed attempt to work through consultation towards an incomes policy is educative in placing reliance on the spread of information and on an appeal to reason.

To judge from his letter to The Times last Friday, Professor Hayek has concluded that if the Government's policies are to work in time to be politically effective, the power of the unions must first be curbed at a stroke and thereafter inflation terminated instantly. But the unions should not, and cannot, be stripped of their power like that; and if people think they can then they do not know much about human relations in British industry.

Again, in the debate on the Government's monetary policies last week, the noble Lord, Lord Thorneycroft, said that one reason why he did not think that the Government would go back was that they had nowhere else to go. I have heard that phrase again this afternoon in a somewhat different connection. Is it constantly claimed that all other policies have been tried and that they have failed. That is not true. What has not yet been tried, and what both the major political parties—particularly in their attitude to the question of electoral reform—seem determined, at whatever cost to stability and to continuity of policy, not to try, is an attempt to confront our basic economic and industrial problems together. As I have said often enough before, those problems are, in my view, now so deep-seated and intractable, and the measures needed to solve them are likely to prove so painful and controversial that neither of the major parties will be able to deal with them single-handed.

If the Government's policies do not succeed, there does mercifully remain one alternative to this country's absolute decline into a siege economy. It is together to identify a common national purpose and to determine the means by which that is to be achieved. It looks to me as if that is the choice we may all have to make before long, so we had better get it right.

Meanwhile, we are all in the same boat, and it seems to me that we should endeavour to pull together, at least to the extent of pooling our ideas and building on them wherever we can. It is in that spirit that I welcome very much this Motion; and I hope that when the noble Lord, Lord Soames, comes to reply he will be able to assure us that, whatever our differences, the Government will take careful account of the views that we all express.

4.47 p.m.


My Lords, I should like to add my own congratulations to the noble Lord the Leader of the House, and to his wife, on the honours that were most deservedly bestowed upon them in the recent Honours List. I should also like to say how much I regret having resigned my Fellowship at Oxford because I would have had the privilege of being his son's tutor. He could not have chosen a better college.

My Lords, I think for a number of reasons this is a more important debate than the related debate last week. First of all, in practice there is singularly little difference between the monetary policies adopted by various administrations in recent years. The difference has not been one of strategy; the difference has been one of the intensity with which the medicine was forced down the throat of the patient.

What has been markedly different from Administration to Administration has been the attitude to what the noble Lord, Lord Rochester, has referred to as the intractable problem of wage and salary negotiation. This problem of wage and salary negotiation lies very much at the heart of the bitterness, which is all too apparent in certain areas of social life, and at the occasional periods of almost suicidal industrial civil war which unfortunately have marked our history from time to time in the past decade or so. We are also debating a very important issue because it is quite central to the two conflicting economic theories which claim your Lordships' attention.

If the monetary policy adopted by this Government (which was also adopted before by Mr. Jenkins and also to some degree by Mr. Healey) is to work, then huge areas of pay cannot be settled on the basis of comparability alone because the monetary policy will then go off at half-cock. Similarly, as the noble Lord, Lord Balogh, pointed out in a very important article as long ago as 1943, no Keynesian policy of managing the economy by steady reflation can work unless there is a widely accepted incomes policy of the kind which the noble Lord, Lord Rochester, has just outlined.

Both sides of the debate must take a view about the settlement of wages in the public sector. We must remember that the public sector now accounts for a very substantial proportion of the labour force, and particularly a very high proportion of the highly qualified manpower of the community—those who work in the Civil Service, teaching and medicine, in the other nationalised industries, and so on. This is a very high proportion of the high salary earners in our society.

When we turn our minds to the question as to what ought to be the basis on which pay, particularly at these higher levels, should be settled, we have very important academic evidence that there is in this country a very long persistence of relationships of one wage to another. There is a strong rigidity of relative wages and salaries going back over many years. If I may quote from the work of a distinguished colleague of mine, Dr. Keith Norris, in the Lloyds Bank Review for October 1975, he says: … some statistics of industrial earnings go back a long way and we can draw on a fair number of published studies of changes in industrial earnings … Most investigators have measured the stability of the industrial pay structure over time … and have arrived at much the same conclusions. Although they differ slightly in their interpretations of the results, the general conclusion is that the structure does not change much over time". I think that is an important point, and I agree with what the noble Lord on the Opposition Front Bench said: people's sense of fairness is here concerned, and fairness is very largely concerned with the way in which we expect to be treated. The problem in the public sector is that we now have a very strange convoy system, where ships are tending to go at the speed of the fastest, rather than at the speed of the slowest, vessel. In my view, the whole comparability exercise is now being used in such a way that it is accelerating the rate of the wage rise; and the comparability exercise, for example, taking place somewhere round about the median wage level, added to the hierarchical nature of the salary settlements which prevail throughout the public sector, causes a ratchet effect. You get a settlement, say by arbitration, regarding comparatively low-income earners and this automatically works its way right up to the chairmen of nationalised industries, permanent secretaries and so on, because they are in a paid hierarchy. In my view, it is these two things between them which have caused this quite extraordinary increase in wage and salary settlements.

It is fairly obvious, from the narrative which the noble Lord, Lord Houghton of Sowerby, gave the House, that the principle of comparability is very widely accepted. It has a very long history, and it obviously rests upon one very important criterion to which I have already referred: people's sense of fairness. People undoubtedly look at other groups casually and say: "My present salary is out of line; I am being unfairly treated". That is what, in my view, lies at the heart of the thing. But it is not by any means, to my mind, an obviously correct way of settling wages and salaries, because basically wages and salaries are the price of labour, and as the supply and demand conditions for labour change so you would expect salaries and wages to change relatively one with another—though, as I have already pointed out, this happens in this country very slowly and increasingly with some difficulty because we now have, by institutional agreement with the Civil Service unions and a large number of other bodies all over the country, the institutionalisation of comparability as the basis, which necessarily means that the rigid structure not only persists but is intensified.

The real trouble I have intellectually with comparability studies is the one to which the noble Lord, Lord Boyd-Carpenter, referred in his brilliant opening speech, if I may say so. It is that the public service is now so big that there is singularly little to compare it with. Take the case of teachers. I suppose you could compare teachers with some teachers in the public schools, but that woud mean comparing 95 per cent. with 5 per cent. which is not, of course, a possible comparison. If you take the case of doctors, how many doctors actually practise within the National Health Service? I suspect it is something like 95 per cent. and so you could not take the earnings of the few specialists in Harley Street who treat foreign visitors to these shores as being indicative of what the free market would say doctors are worth.

That is the fundamental thing. When all these Royal Commisions were reporting, the Civil Service consisted of a few gentlemen who travelled up by tram from Herne Hill and propelled pens and so on in small offices, retired at 60 to their villas in Herne Hill and then got part-time jobs as, say, secretary to the Society of Genealogists or something of that kind. How very different that is from the enormous army we now have as a result of successive Governments extending the area of the public service where, of course, they are at the very heart of our society—as is proved by the fact that when they leave the Civil Service at 60 they are a highly marketable property because of the great wisdom and experience they have gained in this very large service.

That, my Lords, is the real heart of the problem, and I have a few suggestions to make, since the noble Lord, Lord Rochester, quite rightly said that it is up to us to produce a few suggestions. I must say that I think the whole comparability exercise has been spoiled by the coming and going of incomes policies, because the incomes policies which have been savagely introduced from time to time have always been at the expense of the higher earners. They have always been a flat rate increase of a couple of pounds a week or 3 per cent. for the people below £8,000, or something of that kind. So of course you get this cumulative weight at the end, and this is what we are coming through now, as we have come through several times since the late 1950s when incomes policies came through. One national incomes commission or some similar body was set up, and I seem to remember that the only occupational group they ever dealt with was university teachers: perhaps the noble Lord, Lord Robbins, will remember that. I remember, as a Reader in the University of London, suddenly finding my salary almost doubled overnight as a result of this magnificent body which of course almost immediately was wound up before they got around to some important group! We have never had a pay award of comparable size since. Unfortunately, we did not benefit from the singular generosity of the noble Lord, Lord Houghton of Sowerby, to the teachers just before the 1976 Election.

I should have thought that in this area we actually have a duty, as a nation, to try to get some sense into this pay settlement business in the public sector and to go back to some attempt to see what supply and demand tell us. Supply and demand do not actually operate only at the entry point, and one of the problems with comparability with the Civil Service is that the great influx into its higher levels is at the age of 21 or 22 and not very much later, so that they go on along the tramlines until the age of 60, and you are not comparing like with like. You are not trying to recruit people at 45 or 50 in very large numbers to see whether people would actually take jobs in the Civil Service at the prevailing salary levels. I should have thought that there is evidence that supply and demand does work, even in a profession like my own of university teaching, where nominally all ranks are paid exactly the same salary at a given level in all universities. For example, it is very much easier to be promoted to senior lecturer or professor if you are in a subject which is in high demand than if your subject is in very low demand, like Russian or Classical Greek. You can soldier on in Russian or Classical Greek studies for ever and not get promoted. In that way, supply and demand actually works in a profession like my own, which has very rigid salary structures.

The question I want to raise is this: I doubt very much, with the noble Lord, Lord Boyd-Carpenter, the intellectual validity of much of the comparability exercise now because, as the noble Lord, Lord Shepherd, pointed out, all these factors are taken into consideration by the Pay Research Unit when they lay the results of their researches before the negotiators. But how do you weigh up, as an intellectual exercise, long holidays, free cars, very low bank interest rates and loans given to people who work for banks, as opposed to security of tenure which you get in the Civil Service and as opposed to retiring at 60?

These are frightfully difficult things to do and in reality the only way you can weigh it up is when you yourself are making a choice and you ask: Would I leave my present job to get another in another walk of life because I find it more attractive? That is the way the market system actually works. I know this is frightfully difficult and you might have to have quite a hefty battle to settle it, but I would seriously suggest that it would be a good idea, certainly in the higher Civil Service, to try a policy of positive recruitment to all levels consistently. For example, Under-Secretaryships and Assistant Secretaryships could be advertised, as university posts are, and the world could be asked to apply, regardless of past experience. You would not need to have been a civil servant before you applied for a post. If we did that on a broad scale, we would then begin to get something which is healthy in itself—an interchange between the Civil Service and the rest of society—but we would also have a market test.

When I was a don at Oxford, you held your fellowship for five years and then it was renewable—there were not many fellowships that were not renewed, because the college governing body would have been a very uncomfortable place if we had periodically turfed people out—but I cannot help feeling that the principle of five-year contracts, as opposed to lifetime tenure, has a great deal to recommend it. I do not believe that tenures lasting to retirement age are desirable in academic life, and it is a very dangerous principle in a Civil Service which is now as large as ours is. It is an enormous service, compared with what it was before the war and during the time when those Royal Commissions were sitting, to which the noble Lord, Lord Houghton, referred in his extraordinarily powerful, persuasive and compelling speech.

It is my own experience in appointing youngish people to university posts that something has gone wrong somewhere in the comparability exercise, because there is no doubt—and I have a very large postbag from former colleagues of mine who are now in the Civil Service, or who were formerly in the Civil Service—that, man for man, the Civil Service is now paying much better.

I know that they do not get some of the fringe benefits which people get in industry and commerce, but, with due respect, the comparison which is often made is with employment in merchant banks in the City of London, which are a very specialised case. I get the powerful impression, and I always suspect, that pay research or comparability research of the kind which is done gets out of step with ordinary common sense observation, and my ordinary common sense observation is that, as a result of the incomes policies and comparability exercises, the public sector is well in advance. I should not have thought that was a bad thing, though it might lead to terrible trouble, if the Government were now to say, "No, we will not give these very large awards, nor will we give them next time." That would very significantly help the fight against inflation and make the economic policies work in trying to restore prosperity.

5.3 p.m.


My Lords, we are indebted to the noble Lord, Lord Boyd-Carpenter, for introducing this subject, and also for the very interesting speech which he made. I should also like to add my congratulations to the noble Lord the Leader of the House on his recent honour, which he so ably earned, and to wish him well.

This debate was bound to be largely about the public sector, even in a mixed economy. Comparability in the public sector, even apart from the Civil Service, is a problem which has worried nearly every Government. I hope that the Government will not agree to pay some of the enormous top salaries, which have been suggested in the press, for those top or senior executives who are running some of the nationalised industries. These industries are today run very much by the executive suite. You have the director of industrial relations, you have the cost accountant director, and they work as a team. The one who steps out of place often misses what is going as the plum job. So although part of these enormous salaries goes back to the tax collector, I do not think they are in keeping with what is happening today in this country.

In 1945, when all the nationalisation Bills were going through another place, the late Herbert Morrison was pressed to set up an executive college for training purposes. Men who were leaving great industries were suddenly being called upon to join nationalised industries which are an entirely different proposition, because the biggest problem in the running of those industries—whether it is steel or anything else—is industrial relations. But the then Lord President said: "No, once you have nationalised an industry you have got to leave it to run itself and you must not interfere." In the result we have had various troubles since. There were also suggestions at that time that executives in the nationalised industries and leaders of trade unions should take specialised courses in seminars, such as the one at Davos in Switzerland and so on, very much as the Germans do every year. But, again, I am afraid, that that was also turned down.

If we are honest, it is the fact that no party in this country has ever really faced up to a national wages policy and all its implications. In a totalitarian state, it is easy. They begin with a vocational allocation in schools and say: "You will be an engineer, you will be a doctor and you will be something else." But in a free society we have never faced up to the problem of a national wages policy and all the relativities. The vice-chancellors of a university here may one year favour science, and the next year the arts, so in the private sector we have the skilled engineer who has served five years apprenticeship to get his indentures earning £70 a week, while an unskilled man, who does not know a nut from a bolt, is getting £90 a week elsewhere. Where is the relativity in that? In other words, you go where you can; you get what you think is the most you are going to get, wherever it is, and there is no loyalty whatever to the company with which you began your apprenticeship.

I asked a cost accountant, who deals with these matters, how the annual round of wage settlements works. He said: "This year they are asking for a 20 per cent. increase for the same job, executed in the same time, to the same quality and the same finish." He said: "They always say that it is because the cost of living has gone up since last year." It has nothing to do with productivity. He has to produce the product to sell abroad, in competition, and he said that such an increase would price him out of the market. So he decided to make wider inquiries. He wanted to know why they asked for 20 per cent. every year, because the cost of living had gone up. It has nothing to do with the technical problem of producing the product, which is the same. He found that private industry and nationalised industries were comparable in many respects, certainly in regard to electricians and people of that kind.

But he also found that comparability had little to do with skills, and that these rounds every year were simply concerned with the social factors, based on requirements. So he tried to find out what it was. It proved to be a colour television, a car, the pools, bingo, tobacco, a holiday, supermarkets. And sometimes the wife had to go to work to maintain the standard. It is this—this is what we have to remember, whether in the public or the private sector—which has created a demand, irrespective of skills, which is almost universal.

We have to recognise that the constant pressure of television advertising has created this standard of living and this universal desire. It does it every day. It is a new kind of comparability, involving cost of living standards: "They have it, so we want it", instead of the all-important question of relating it to productivity.

There are critics who say that the Government's monetary policy will change this to some degree. When you speak to people they tell you that there is plenty of money in circulation: that you can see this if you look at the shops, at the coach stations, at the holiday spending. But this is in the South of England. The position is different in the North. We are two nations. The North is entirely different from the South. I think it was the noble Earl, Lord Gowrie, who said that we are two nations, with the great manufacturing industries in the North, which are having a poor time of it, and with the consumer and service industries in the South, which certainly are booming. It is said that the real problem, when you get down to it on a national scale, is that the national overheads are too heavy for productivity to carry. That is the problem in this country today, whatever the Government.

The first thing, whatever the Government, to do about this, apart from the newspaper reports which have been referred to, is to upgrade skilled workers, skilled artisans. Jack Jones, who did a marvellous job for his union, drove a coach and horses through comparability and relativity in industry. There comes a time when a country cannot go on borrowing money; the inflation balloon will burst. The other relativity problem concerns the comparison between working and taking benefit payments. That problem, in a welfare state, whatever the Government, will not be very easy to solve.

5.14 p.m.


My Lords, I, too, should like to begin by extending my warmest congratulations to my noble friend the Leader of the House, and to Lady Soames as well. I must apologise to your Lordships for not having been here for the opening speeches, because of another appointment. I am extremely sorry if, as a result, I cover ground which other speakers have already covered. For that I beg your Lordships' forgiveness.

Before I come to what I have to say to your Lordships, I noted that the noble Lord, Lord Rochester, part of whose speech I did hear, said that the evidence was that industry was giving in on the wages front. I agree with him that, so far, this is so. But there is all kinds of evidence that it will not continue. One can take heart from that if one believes that there is a close relationship between inflation and wage settlements—which I do.

I shall limit my remarks, which I suspect my noble friend wants one to do, strictly to comparability between non-profitmaking bodies and productive industry. It seems to me, from experience, that this exercise, whenever it is attempted, is impossible because one is not comparing like with like. One only has to read the various Clegg Reports to see what appalling difficulties Professor Clegg had in trying to make sense of his terms of reference when he tackled each and every group of people that he tried to deal with. Whatever one may think about whether it was a good thing to have a Clegg Commission, and whatever one may think about the outcome, I believe that Professor Clegg did a splendid job within the limits of his terms of reference—which, of course, were set for him by the party of the noble Lords opposite.

These obvious difficulties are due in part to the fact that in effect Professor Clegg conducted a job evaluation exercise. Any of your Lordships who, like myself, have conducted such an exercise on an individual and relatively small organisation will know that even in those circumstances it is extremely difficult. I should add that when I did it we had the full co-operation of the trade unions. Indeed, we had the benefit of having only one trade union to deal with. All these factors should have made for an exercise which could be easily conducted. All the same, there were the most difficult anomalies within the system. However much you carefully structured the rules under which you conducted the exercise and however much advice you took from experts and people with experience, this was so, even on a small scale. The idea that you can do it on a large scale is, to me, pie in the sky.

What is the answer if you cannot do that? As has been said, people have come to expect comparability across the board. I suggest that one goes wrong by having comparability all the way up the structure. The further one gets away from the lowest paid employees in any organisation the more the difference that there is between them and the terms and conditions and wages of the people higher up the scale. I shall return to that point later.

It seems to me that a possible line to pursue, if ever it is again necessary to set up a commission like the Clegg Commission, is to limit their terms of reference to establishing a minimum earnings level only—using comparability, by all means, for that. One would call on the experience of the joint industrial councils, about which I spoke at the end of last week in relation to an amendment to the Employment Bill. The joint industrial councils have been in being for 40 years or more. To my knowledge, they have never aimed at establishing minimum earnings levels except for the lower paid persons in the industries concerned, though at times there must have been a temptation to aim higher. However, I have been unable to discover this. I think this could be because the long experience of these joint bodies, with equal membership of trade unions and management, has shown that that is as far as you reasonably can go before you start to get the anomalies to which I referred in an ordinary, simple job evaluation exercise.

If one limits it to the minimum earnings level, if one has to do it at all—it should be possible not to have an arbiter because it is much easier to deal with the interchangeability of people at the lowest levels—what must one then do about all the other levels upwards: the differentials between the junior management, the middle management, the senior management, the board of directors—the lot—and all the other people in between? I would suggest that the differentials are best left to the organisation itself to sort out, but, if they cannot come to an agreement and there has to be an outside arbiter of some sort, the most important thing is that the arbiter should be set a totally separate task from the one of comparability for the minimum earnings level and invited to do the differentials as a special exercise. Possibly one should even have a different arbiter, so that he is not tainted. I should have thought that way of tackling the problem might offer a way through.

As to how to tackle the differentials, I was most intrigued and very taken with the suggestions made by my noble friend Lord Vaizey in relation to the Civil Service, of recruiting at all levels in order to establish the market demand for the particular jobs. That would be a way of doing it and I think it might be a good way through. There is another way, because at certain stages one has to bring in theory. This will be very familiar to the noble Lord, Lord Vaizey. It is a system about which I first read in a book by Professor Elliott Jaques who was (and perhaps still is) a colleague of the noble Lord and who worked with the noble Lord, Lord Brown. I am extremely sorry that the noble Lord, Lord Brown, is not with us for this debate, because he knows a great deal about this subject and your Lordships will have heard him talking about establishing a kind of parliament of trade unionists in order to establish the minimum wage. That is only part of the story. What I can tell you is of an experiment that was done in his company under the auspices of Professor Jaques in which he established a phrase—and I ask your Lordships to forgive me for the jargon words—called "the time-span of discretion". He was able to establish a relationship between the level at which people should have authority and the amount of discretion they were given before they had to check with somebody senior before they could move on to another task. I may be describing it badly but it is sufficient for the purpose.

It was also discovered that the pay scales related to the formula from which this derived were not only sensible ones from the differential point of view but also—and this is very important and was verified by cross-checking backwards—were seen to be fair by all the employees at all levels. So the method had that balancing factor to prove it.

I have mentioned this in detail because it seems to me that, when one starts to think about the Top Salary Review Board, and its possible recommendations, it may have been doing a correlation with the top people in industry, but of course the discretion allowed to the chairman and directors of a nationalised industry or to a permanent under-secretary and his immediate deputy secretaries is nothing like that of the main board of directors of a public company. The main board of directors sinks or swims by its decisions but, unfortunately for him, the chairman of British Rail (and I hope he will forgive me for choosing him straight out of the air) cannot, under the system of nationalised industries, be given the same sort of discretion. In the end he has to refer to the Government. In fact, to my mind, within the general structure of government and its supporting Civil Service and the vast organisations that it runs, like the nationalised industries, the only unit that compares to the main board of directors of any independent company is the Cabinet. It may be that they are the only ones who should be paid the rate for the job in comparison with those kinds of people.

I am not trying to curry favour with my noble friend on the Front Bench, but, as it were, to sum up, the important point about this is that the lower you are down the scale the easier it is to establish comparability between all sorts of activities, whether they be non-profit making or whether they be productive enterprises. But the higher you get up, and particularly when you get to the top, the more impossible it is to make any comparison at all, and it is pie in the sky for people who, by the very nature of their job, cannot have the responsibility which no doubt they would dearly like to have to imagine that in the end they ought to have the same pay and terms and conditions as their opposite numbers in productive industry. I believe that comparability should be forgotten, except at the lowest levels.

5.26 p.m.


My Lords, I suppose it is always said but I really do mean it this afternoon: I think we should be exceedingly grateful to my noble friend Lord Boyd-Carpenter for having instigated this debate, and I say that for two reasons. One, that I suppose public sector pay in general is probably one of the most complicated and certainly one of the most important matters which Government, in the present circumstances and the present economic difficulties through which the country is passing, have to face. Secondly, it is extremely timely because with one pay round coming to an end and another one just about to begin—for there is not much gap between the two—this is, as it were, on the front burner.

I should like to start by thanking all those noble Lords who have spoken in this debate for the kind and generous things they have said about me and my wife, and also about my son. Perhaps I may say to the noble Lord, Lord Boyd-Carpenter, that if the new President of the Oxford Union ever comes to be so good a debater as his predecessor he will be a very proud man indeed. But in view of what the noble Lord said, I expect he will be getting an invitation to go and debate there.

I am glad to be talking in the same debate as the noble Lord, Lord Granville of Eye. The last time I had the pleasure of doing so was when I was eight years old. He defeated my father in the general election of 1929, in spite of all that I tried to do to bring about a different result. I was interested to hear what he had to say today.

Generaly speaking, this has been a fascinating debate and I have listened to it with great attention. I see sitting there the noble Lord, Lord Robbins, who probably has forgotten more about this than most of us have ever learned, paying great attention to the debate and nodding a good deal. I will certainly read this debate with interest because it is timely and the problems are before us just at the moment.

I was grateful to the noble Lord, Lord Houghton of Sowerby, for saying that I was obviously going to be walking on rather thin ice in talking about these matters on behalf of Her Majesty's Government at this particular time, and for the words that he used when he said that he did not expect me to be able to make any notable pronouncements this afternoon. Strange to relate, he is right, but I should like to put a few thoughts before your Lordships.

There are very real worries and doubts about comparability and the wisdom of comparability, but it is not in itself the root cause of our economic problems. Comparability is, in effect, one of the mirrors which reflect the deeper problems that beset us as a country; and as my noble friend Lord Boyd-Carpenter said, the real problems are the underlying ones of inflation and of an approach to pay bargaining generally which bears no relation to what the country can afford today. It is linked much too closely to the level of inflation and not nearly closely enough to what we can afford through our own production. This debate is taking place on a day when it has been announced that the rate of production for the last 12 months is not only static but is less than the rate of production in the 12 months previously.

Therefore, the general approach to pay bargaining—this applies to both the private and the public sectors—has been, in recent years, much too high, and of course particularly high in the last year or two; this is one of the results of some years of an attempted and prolonged rigid control of incomes, which only results inevitably, one year or the next, in what are called "catching-up" increases, to which the noble Lord referred, in much of the public sector, which have been a reflection both of the rigidity of that control within the public sector as opposed to the private sector and also of the inevitable backlash in all sectors when that policy of control collapsed. I hope the lessons of that experience will not be lost on any of us.

What we have to do is to put this period of large pay increases behind us and, in the coming round, get back to responsible pay bargaining and levels of settlements which the country can afford, given the circumstances. That goes for all sectors of the economy—both private and public. If we can now go into the next pay round with the anomalies created by the years of rigid incomes policy behind us, then we must have a chance, let us hope, of a new and more responsible attitude to pay bargaining. Certainly we have got to see this if the country is going to pull through its difficulties.

In the private sector, it is up to the firms and unions to heed what each company can afford to pay, taking into account the Government's determination to bring money supply under control. Failure to do this can only mean a squeeze on profits, lack of investment, and fewer jobs, either in the short run or in the long run. In the public sector, the Government's role has to be to impose a similar financial discipline through the use of cash limits which reflect what the taxpayer and ratepayer can afford. The effect of settlements which do not take account of these constraints can only be, once again, loss of jobs, loss of services, or both.

It is against this economic background and these aims for the future that the use of comparability in setting public service pay must be judged. What is comparability, or the doctrine of comparability, as my noble friend described it? The aim of formal pay comparisons is to ensure that staff in the public services are paid at broadly the same level as staff engaged on comparable work elsewhere. That is to provide a proxy for the market in the absence of comparable indicators of performance. There are advantages and disadvantages to such a system, and I will come back to these in a moment. But, in answer to my noble friend Lord Vaizey, who made such an interesting and useful contribution to this debate, there was one point I would like to take up. He said that the public sector has got so big, and touches the life of our people at so many points now that we really have nothing to compare it with.

My noble friend then cited teachers. Well, whether there are a lot of teachers or few teachers, this problem is always there with teachers; it is not because of their numbers. But I do want to tell him that where pay research is concerned for the Civil Service, what he said does not apply, because of the analogues that are taken for the Civil Service. Agreed there are 20 per cent. who are elsewhere in the public sector, but 80 per cent. of them are in fact in the private sector. So where pay research is concerned at least, and for jobs within the Civil Service as a whole, there are plenty of analogues that can be taken. So I do not think this arose so much from the size of the public sector. He said, how do you compare the doctors? I agree that there is always, in certain areas, a difficulty.

There is always, I think, as indeed my noble friend Lord Vaizey said, a disposition on the part of workers and managers to measure their wages and salaries against those offered for similar work by other employers. This is something that one cannot ignore, whether or not it is enshrined in formal machinery. It is a fact of life. There may be a case for having a well-disciplined system for making pay comparisons, rather than allowing a free-for-all in which each side makes its own comparisons, because that is the alternative. But such machinery must meet the tests of providing an outcome which is acceptable not only to those whose pay it determines but also to those who pay the pay that it determines; that is, the taxpayer and the ratepayer.

Now for the machinery. As the noble Lord, Lord Houghton, said, the move to formalised pay comparability has been the trend in the public sector for some years, beginning back with the Priestley Report in 1955. Indeed it was, in general the practice for the Civil Service for some years before that, but this highlighted it and made it more precise. Then there were the review bodies, established in their present form in 1971, to take comparability into account in their recommendations, but no more than that, for armed forces, doctors and dentists, and top salaries in the nationalised industries, the judiciary and the top levels of the Civil Service and the armed forces. Then the last Government set up the Standing Commission on Pay Comparability chaired by Professor Clegg. The commission has now produced seven reports, including those on local authority and university manual staff, National Health Service ancillaries and ambulancemen, nurses and teachers. It has some other smaller references in hand.

My Lords, I can speak with much greater knowledge about the Civil Service than I can about the other facets of comparability because I have a responsibility there. There have been, I think, special reasons for the application of strict comparability to Civil Service pay. Indeed my noble friend Lord Boyd-Carpenter referred to the extent to which he differentiates in his mind between comparability in the form of pay research for the Civil Service compared with other aspects of comparability. Governments can seek by one means or another to influence pay levels throughout the public sector; but only in the Civil Service and the armed forces do they have direct responsibility for pay and also for all the other ingredients of the total manpower bill—the tasks and the standards to which they must be performed, efficiency, the numbers and grades of staff required. This explains the need that has been felt, and always felt, for a formal well-publicised system for setting Civil Service pay.

It is against that background that the Civil Service system of pay research has been developed. It rests on a detailed annual exercise in which comparisons are made between a wide range of Civil Service jobs and comparable jobs—or anologues—outside. The pay research surveys are carried out by an independent unit, the Pay Research Unit, which consists both of civil servants and people from outside, and the outside analogues are selected to ensure that they are fully representative; at least, that is the idea. The work of the unit is overseen by the Pay Research Unit Board, chaired by the noble Lord, Lord Shepherd.

The noble Lord, Lord Houghton, has, with his long experience of the Civil Service and many other parts of the public services, spoken generally in favour of the continuation of comparability as a system. I do not think that we should lightly disregard his views, but perhaps I could digress here to make a personal observation. The Civil Service system has done us pretty well in recruiting and retaining loyal servants to this country. The noble Lord, Lord Houghton, who has spoken with such authority in this debate, told us that he entered the Inland Revenue in the boy clerks' competition of 1915—that was a year or two ago! Indeed, I understand that he has been entertaining to lunch here today 65 of the other entrants to the Inland Revenue through that same competition in 1915. All I can say is that if they have given half the valuable service that the noble Lord has given, I am sure that your Lordships will agree that the country has had good value from them.

I wish to emphasise how lucky we are in this country to have such a high quality Civil Service. Anyone who has worked abroad, especially in international organisations and who has therefore had the opportunity of fair comparisons, as many of your Lordships have done and as I have done, cannot fail to appreciate this.

In the present difficult circumstances, it is, I suppose, inevitable that pay research, which has for so long been the basis for determining Civil Service pay, should come under severe questioning—particularly, certain aspects such as index-linked pensions. But it would be a great tragedy if people were to assume that, because we are right to debate these matters and because they set examples and therefore are of great importance to the country, that means that we are being critical of the Service itself. That is what has been built up. Because we are constantly questioning this, the Civil Service is beginning to suffer from a lowering of morale, which is wrong, which should not be happening and which does nothing but harm to the country, and it does not deserve it. The Civil Service understands that we are questioning these matters, but I am afraid the public at large tend to think that because we are doing so, we think that there is too much, wrong with the Service itself. However, that is not so.

On the question of the analogues, it is essential that the system should be as open as possible and that the analogues should cover the whole range of outside employers, including low-payers as well as high-payers—those with low budgets for pay, as well as those with high budgets for pay—and that non-pay factors are given their due weight. I do not like using the word "non" but I do not know how else to describe it. I am referring to such things as pensions, perks, motor cars and so on. I understand that 60 per cent. of the new motor cars bought in this country are bought by firms and businesses. The fact that the recent high levels of taxation for many years have brought into being this sort of system of payment in the private sector must be reflected by those considering pay in the public sector as well. However, it should have its due weight and no more.

On the subject of pensions, your Lordships will be aware that the Government have set up an inquiry chaired by Sir Bernard Scott into the value placed on index-linked pensions and job security in public sector pay generally, including the Civil Service. Have we got it right, or have we not got it right? Whether we have or have not, there are many people who think that we have not got it right. The Government Actuary says what he says, and that is what he is there for. He is a very able man. He has written his report and it is there for us all to read. However, I think that it was a good idea to ask Sir Bernard Scott and a bunch of intelligent people around him to look further into this matter and to let us know their views, because this is an issue of much public concern and it is important that it should not only be properly examined, but should be seen to be properly examined.

I turn back to public service pay generally. The question that we must ask and which this debate is about is as follows. Is comparability the best method of setting public service pay? It has its advantages. The formal pay comparisons helped to identify a market rate of pay for the public services. There is no open market for their products. The normal tests of profit and loss are to a great extent missing—certainly totally missing in the Civil Service. Fair comparisons with jobs outside, if they are fully and properly established, should ensure that the public services get paid no more and no less than the market as a whole is paid.

Seen in that light, comparability aims to be fair to the taxpayer and the ratepayer. It is designed to ensure that the public services get a fair share of the nation's talent at a fair price. It also aims to be fair to the employee who can be confident that his pay will move broadly in line with outside analogues. But it also has its disadvantages. With the continuing problems of high inflation and high unemployment and, therefore, with a change in supply in demand, we must ask: Is comparability enough? It raises a number of problems, many of which have been brought to our attention this afternoon.

I think that there are two matters to which we should give out attention. The first is one that I should like to highlight because it is the most sophisticated and has been taken the furthest and I do not want to muddle your Lordships' minds with one thing and another. I should like to concentrate on what I think is the most sophisticated system of comparability—namely: pay research. As the noble Lord, Lord Houghton, said, it should be brought up to date. At any rate the fundamentals of the system should be looked at every so often. I think, as I believe he did—and this is what I inferred from his speech—that it is time this was done. I agree with him. We should discuss the matter with the unions concerned. We should put it to them and we must bring it up to date. We must be sure that it is seen by the country not to be what the noble Lord, Lord Rochester, said people thought it was at least in danger of becoming—that is, something done by the Civil Service for the Civil Service.

There are plenty of ways of looking at that. I think that we were right, as I have said, to set up this committee to look into indexed-linked pensions. Is sufficient being given for that? Is supply and demand being taken enough into account? Is there anything in merit pay? Are we right to continue along the road of "Buggins' turn"?—so that you are promoted automatically, unless you do something frightful. You are promoted after so many years and you can foretell and foresee your increments. Is that right, or should we be thinking of paying more for merit? I just put these forward as examples of how I think we ought to be bringing the system up to date.

Then comes the question of why the system is in trouble. I shall tell your Lordships why I think the system is in trouble. The system is in trouble because we are all in trouble because of the rate of inflation. There was no problem about this in the 1950s and, indeed, in the 1960s when the rate of inflation was 2 or 3 per cent.—it almost did not count in our thinking. It was all right and there was never a problem over it. But with inflation jumping around and never being lower than 7 per cent. but up to 27 per cent., and then down again and up again, it has caused very severe problems.

The noble Lord, Lord Houghton, said that in his view comparability should always dominate. The degree of inflation has created great difficulties for many firms in the private sector in settling their wages and, in arriving at their budget for wages, they have to take into account the constraints of the market. British Leyland had what we call a cash limit for wages this year of 7 per cent. or 7½ per cent.—I cannot remember the exact figure, but it was very small—because it could not afford more. That was its budget or, as we say, its cash limit.

Given the circumstances in which the country finds itself, we must also think to what extent we can allow what we want to see as the main system of comparability and pay research to dominate. To quote what we said in that publication that we issue at election time—what do we call it?—our manifesto (you see how good I have become since I left the other place)—"How are we going to reconcile pay research and cash limits?" How did we do it this year? This problem came upon us this year. Why did it come upon us this year? It came upon us this year because in 1979 the previous Government had many problems with Civil Service pay. That year there was an incomes policy of 5 per cent., which followed another one of 10 per cent. the previous year; I do not know what it was before that. In fact, the top could not be kept on that pot and it boiled over. There were terrible troubles and the line could not be held. It ended up with a settlement of between 20 per cent. and 25 per cent.

For obvious reasons the Government could not accept that in one year because of the effect it would have upon settlements in the private sector. So what did they do? They staged the increase. They said: "We shall give you X per cent. this year; X per cent. next year", and so on. In the pay round for the Civil Service which we have just completed for 1980 an extra 9 per cent. was nothing more and nothing less than a hangover from the settlement in 1979. The actual settlement that was reached this year in round figures started at 18½ per cent.—I was away at the time, but it was about that—and by a combination of saying that we intended to reduce the number of civil servants to whom we would pay that increase, and also by commencing the increase one month later than usual, we reduced it to the equivalent of 14 per cent., which was the cash limit.

That was how we reconciled the cash limit to the pay research system this year. But, of course, what did the media say? They immediately said that it was a 25 per cent. increase for the Civil Service because it was 16 per cent. for this year, plus 9 per cent. which had been agreed the previous year. But had matters been different, that 9 per cent. would have been paid out the previous year. It was not fair to the Civil Service to start other than from that point. But the increase was spoken of as being 25 per cent. Once that information gets under way, it is like a bush fire. Over and over again we heard people in the private sector say to us: "How do you expect us to hold down our wages when you give a 25 per cent. increase to the Civil Service?" Once a forest fire like that starts, it is the devil to put out, let alone to make the trees grow right again.

Those, therefore, are the problems that face us. Although I would go along with the noble Lord, Lord Houghton, in saying that pay research is a most valuable instrument, which has served us well and we must continue to keep it—of course, we must—I would also go along with what my noble friend Lord Boyd-Carpenter said; namely, that in the troubled times through which we are going, in just the same way as the previous Government had to do what they thought was best by holding increases to 5 per cent., and then by introducing staging and all that, we shall have to reconcile as best we can the pay research system and the cash limits. I cannot begin to say how we shall approach the problem next year. We have only just come through this pay round; we have not yet started on the next one, although I suppose that it will not be very long before we do, and then we shall have to make up our minds.

However, I should like to make two points. First, I take the point raised by the noble Lord, Lord Houghton, that we need to update the formulae which go into pay research, the pay agreements and so on. We must consider this ourselves and with the unions concerned. Secondly, many very clever people have tried to apply their minds to finding a better system than pay research, and I am grateful to those noble Lords who today have highlighted one or two changes which they believe might be brought about. We shall, of course, certainly consider them. However, generally speaking, no system has yet been found which is better than pay research, which has been in existence since 1955.

Thirdly, given the situation in which we find ourselves and the economic circumstances, it is impossible to say—just like it was impossible for us to say last year or for the previous Government to say the year before—that the system will be pay research and only pay research; because at the same time the national interest must be borne in mind and somehow, some way, we must find a form of reconciliation which to the greatest extent is in the national interest as well as in the interests of those who receive the payments and those who pay them.

5.57 p.m.


My Lords, I am sure that your Lordships will agree that this has been a significant debate of very great value, if only for the most admirable speech—admirable in its robust frankness—of my noble friend the Lord President. Equally—if I may be allowed without presumption to say so—the debate has been greatly distinguished by the speech of the noble Lord, Lord Vaizey; and it was particularly agreeable to me to hear a speech by the noble Lord, Lord Houghton of Sowerby, from the Box opposite. I was only sorry to hear him say that his tenure of that position is apparently on the basis described in the Housing Bill as "shorthold". The noble Lord with whom, as he said, I have debated for quite a number of years seems to get better and better as he gets older. In that respect at least he resembles a fine vintage port.

But I must take issue with the noble Lord over his use of a debating trick that I have heard him use now for 30-odd years, when he decided to "twit" me with having made no specific suggestions at all. I thought that to suggest doing away with the Clegg Commission, doing away outside the Civil Service area with the doctrine of comparability, suspending the Boyle recommendations, and asking for an energetic review of the guidelines and criteria of pay research in the Civil Service, was perhaps enough for one afternoon. But I shall take the noble Lord's criticism to heart, and on any future occasion when I have the good fortune to address your Lordships I shall become perhaps even more radical.

However, in a more serious vein, I was interested to hear the noble Lord say that today on the subject of comparability people at work look sideways. That is true, but I do not regard that as at all encouraging. To look sideways in that way is very near to envy and, indeed, those of us who criticised the whole comparability exercise under the Clegg Commission were inclined to feel that it had a slight tendency to institutionalise envy, which is one of the most corrosive factors in any society. Indeed, some noble Lords will recall that mediaeval theologians always used to maintain that one of the most exquisite pleasures of the blessed in Heaven was contemplating from the balcony the sufferings of the damned in Hell. That is not on the whole, perhaps, with due respect to the theologians, the most agreeable aspect of any society. In all seriousness, envy is one of the most corrosive factors. Undue emphasis on comparability—saying, "Whatever I'm worth, that chap's getting more than I am and that's unfair"—is not a healthy nor a socially sound nor, I suggest, a morally sound aspect of any society.

My Lords, I now come to the sole purpose of my rising. This is a Motion for Papers. I am conscious of the fact that my noble friend Lord Soames, like his august father-in-law, has an impish and mischievous sense of humour, and I know that I stand at risk, if I do not seek your Lordships' permission to withdraw this Motion for Papers, of receiving a large delivery van from the Civil Service Department tomorrow morning at my private house with a mass of impressive but not necessarily entertaining documentation. I hope, therefore, that your Lordships will have pity on me as I now apply to your Lordships for permission to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

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