Lords Sitting of 31 October 1980

Preamble
The House met at eleven of the clock: The LORD CHANCELLOR On the Woolsack.
Prayers—Read by the Lord Bishop of Norwich

GUINEA: TRADE NEGOTIATIONS
Lord HATCH of LUSBY: 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 can make a further statement about the progress of negotiations on trade relations with the Republic of Guinea.
Lord TREFGARNE: My Lords, since the goodwill mission in March 1980 by representatives of the Guinea Government, a payment towards the arrears of debts due under the 1976 Debt Rescheduling Agreement has been received, and we understand that further payments may be expected in the near future.
Lord HATCH of LUSBY: My Lords, I thank the Minister for that reply. May I ask him whether he is aware that some of us believe that the Government are perfectly sincere in their efforts to develop trade with the Republic of Guinea, but may I ask him two specific questions? First, does he recognise that the situation of Guinea, which is potentially a very rich country, is that, in common with many third world countries, there is at the moment a shortage of cash flow and the investment necessary in order to develop the very rich minerals that they have in that country? Secondly, would he agree that the release, just a couple of weeks ago, of prisoners who have been held since the invasion of 1970 makes the situation as to human rights much more palatable to those of us in this country?
Lord TREFGARNE: My Lords, the release of prisoners and the parallel improvement in the human rights situation is of course to be welcomed wherever and whenever it may occur. As to the com-
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mercial implications of the first part of the noble Lord's supplementary question, the key to increased British participation in that market would of course be the restoration of ECGD cover, and I am pleased to say that an official of the ECGD is to go to Guinea in December to review the position.
Lord HATCH of LUSBY: My Lords, further to that last answer by the noble Lord, may I ask him whether the Government can hold out genuine hope that ECGD cover, which is so important to business in this country as well as to the economic situation in Guinea, can be restored in the near future?
Lord TREFGARNE: My Lords, that will depend upon a number of factors, including progress with the payments under the rescheduled debt agreement.

VEHICLE PARTS: COUNTERFEITING
11.10 a.m.
Lord CROOK: 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 their attention has been drawn to the statement of the Society of Motor Manufacturers and Traders that at least 40 major companies are having their parts counterfeited; that the counterfeit parts are being sold widely in Africa, India and the Far East; and that one firm is losing £2 million a year in the Nigerian market.
Lord LYELL: My Lords, Her Majesty's Government are aware of the concern expressed by the Society of Motor Manufacturers and Traders about the counterfeiting of vehicle parts. The Government are also aware of reports of sales of counter-felt parts in a number of countries, and, indeed, of the difficulties a company in which a United Kingdom manufacturer has an interest is having in Nigeria. But in all cases the Government are ready to do whatever they can to assist the United Kingdom manufacturers concerned, who suffer loss of both sales and reputation from this practice.
Lord LUCAS of CHILWORTH: My Lords, is the Minister aware that, in the United Kingdom domestic market, about £450 million-worth of spare parts are sold through do-it-yourself shops; and that, in a recent survey carried out by leading British brake manufacturers into the quality of 32 of the lesser-known makes of brake pads, only 13 were considered to be satisfactory by those standards, 7 were marginal and 12 failed outright? In view of those two points, is not a safety factor involved in the sale of other than genuine and approved parts in the United Kingdom alone?
Lord LYELL: My Lords, the House will be grateful to hear the value of the parts which are sold every year in the United Kingdom, but if my right honourable friend is to issue warnings or is to take any action on safety grounds he requires specific evidence. Therefore, if my noble friend would get in touch with my right honourable friend, or the department, then I am sure the department would be able to take action, for, indeed, it has a great interest in safety matters of this type.
Lord UNDERHILL: My Lords, in view of the two replies that the Minister has given, would the Government consider it desirable to set in motion an inquiry as to the desirability or practicability of having approved standards for equipment and accessories in connection with cars, particularly in view of the attention that everybody gives to safety standards?
Lord LYELL: My Lords, I think the existing British standards are followed by manufacturers in this country; and, indeed, there are provisions in the Road Traffic Act setting out grounds for prosecutions in cases where defective parts have led to a loss of safety or an accident. I do not think we would want to take further action than that at this stage.
Lord DRUMALBYN: My Lords, does the selling of these parts constitute an offence in law; or can it be dealt with by the Office of Fair Trading? May I ask what additional measures the Government are able to take in the matter of these passing-off attempts?
Lord LYELL: My Lords, to answer the first part of my noble friend's supplementary question, this can be dealt with by the patent laws which are applicable to this country and to 90 other nations. Where there is clear evidence of breach of the patent law the Government may take action, but I do not think I can say anything more specific than that to my noble friend.
Lord CROOK: My Lords, does the noble Lord recall the supplementary question which raised the matter of safety standards? In that connection, has any contact been made with the Royal Society for the Prevention of Accidents?
Lord LYELL: My Lords, I understand that the department has been in touch with RoSPA and the answer is awaited from that society.

PRISONERS OF WAR: PAY DEDUCTION
11.15 a.m.
Lord SHINWELL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the protests by members of the forces who were prisoners of war between 1940 and 1945 about deduction of pay have been considered and what decision has been reached.
The MI NISTER of STATE, MINISTRY of DEFENCE (Lord Strathcona and Mount Royal): My Lords, our inquiries into this question have now been completed. A detailed investigation has been carried out by a study group under the leadership of my honourable friend the Parliamentary Under-Secretary of State for the Royal Air Force. A copy of its full report has been placed in the Library. With the leave of the House, I will circulate in the Official Report a detailed statement of the work of the group and a summary of its conclusions.
In brief, the conclusions are that satisfactory arrangements were made for officers' accounts to be adjusted after the war to take account of money deducted

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from pay which was not received. It is not possible to prove that every returning PoW had his account adjusted as planned but all the indications are that the vast majority did receive some money. There remains the complaint that officers should not have had any money deducted from their pay or, alternatively, that it should have been repaid in full after repatriation, as some Commonwealth Governments decided to do. The Government decided in September 1945 to refund in full all deductions from the accounts of Japanese PoWs in view of the exceptional hard-ships endured by these prisoners. It was open to them to apply the same policy to former prisoners of the Germans and the Italians. In the light of their knowledge of the situation at the time they decided not to do so and there would seem no case for a British Government 35 years later without the advantage of detailed records or contemporary knowledge to seek to go back on this decision.
This is not to say, however, that the Government are in any way unsympathetic to the problems of former PoWs. The Government feel, therefore, that rather than continue to rake over the remaining evidence from 1945, a more constructive approach would be to consider whether additional assistance could be made available. These possibilities are now being studied.
Following is the Statement referred to:
OFFICER PoWs PAY
Following representations received from Flight Lieutenant Roth regarding the deductions from pay of officers held prisoner in the Second World War, which were made public in an article in the Daily Telegraph at the end of August 1980, a study was launched under the chairmanship of the Parliamentary Under-Secretary of State for the Royal Air Force, Mr. Geoffrey Pattie. Extensive searches were made into the records of all three Services, the Public Record Office and the Treasury. Unfortunately, documentary evidence is far from complete. The Navy Department still hold some officer pay records from the Second World War in ledger form but no comparable individual pay records exist for the Army or the RAF. Pay records are normally destroyed after six years. The evidence relating to the Army and the RAF is consequently more circumstantial, but it is clear that the policy of all three Services with regard to PoWs throughout the war was co-ordinated by a tri-Service Committee and that a common policy on pay matters was followed. My honourable friend has discussed the matter at some length with a number of ex-PoWs and representatives of ex-officer associations.
The study has examined initially the basis of the then Government's policy in relation to PoW pay and looked for evidence of promulgation of this policy throughout the Services. It has then sought evidence of arrangements for handling returning PoWs with particular emphasis on their pay. A key question has been to discover the existence of evidence to indicate that any payments were made thereby giving prima facie proof that machinery was not only established but functioned. Evidence was also sought on the disposal of the camp communal funds.
Some former PoWs have maintained that they were unaware that any deductions from their pay were being made. Although there is no reason to doubt the genuineness of this contention, we have established that the policy of making convention-related deductions was promulgated in 1940 in the usual manner and that further efforts were made later in the war to remind camp leaders that deductions were taking place.
The central complaint is that money was deducted in the United Kingdom on account of pay they were supposed to have received from the detaining authorities when, for prolonged periods, they either received nothing or were paid in worthless camp currency. They contend that they were not given an opportunity to reclaim these monies on repatriation.
The study group is satisfied on the evidence that, from quite early in the war, the authorities here were aware of the somewhat variable standards in relation to camp pay and arrangements were made for adjustments to be made to officers' accounts after the war. We can never know for certain how effective this procedure was but we do know that over half a million pounds was paid out to ex-RAF PoWs which does indicate a system that was working tolerably well. For Army officers there is evidence of the payment of claims for adjustment. The Navy Department ledgers provide irrefutable evidence that credits were paid by the Navy to returning officer PoWs. It would be impossible to prove that every returning PoW had his account adjusted as planned but all the indications are that the vast majority did receive some money.
No evidence has been found to support or refute Flight Lieutenant Roth's allegations that he was threatened with prosecution under the Official Secrets Act if he pursued his claim. The allegation must be regarded as unproven. However, the group was greatly impressed by the meticulous care shown by the reception procedures and the desire to "bend over backwards" to help returning prisoners. On the question of communal funds, although, in general, individuals were not reimbursed for contributions, clear evidence exists that substantial sums were redeemed at the end of the war by the British Government and donated to charity.
There remains the complaint that prisoners should not have had any money deducted from their pay or alternatively that it should have been repaid in full after repatriation, in accordance with the practice of some Commonwealth Governments. Her Majesty's Government decided in September 1945 to refund in full all deductions from the accounts of Japanese PoWs. This decision was taken in the light of the appalling experiences that these men had endured. It was open to the Government at the same time to

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reverse their policy in relation to former prisioners of the Germans and Italians. Her Majesty's Government with their contemporary knowledge of the situation and with all the records available decided not to do so and there would seem to be no reason why a British Government 35 years later without the advantage of contemporary insights should seek to vary this policy. The study group is satisfied that despite the fact that many important records are missing, the above conclusions are soundly based. The full report has been placed in the Libraries of both Houses.
On the basis of the evidence before it, the study group had little alternative but to reach the conclusions it did. That is not to say, however, that the Government are in any way unsympathetic to the problems of former PoWs. The Government feel, therefore, that rather than continue to rake over the remaining evidence from 1945 a more constructive response would be to consider whether additional assistance could be made available. These possibilities are now being studied.
Lord SHINWELL: My Lords, I am grateful to the noble Lord the Minister for what I must regard as a favourable response to the demands made by ex-prisoners of war. But without an examination of the report, I am bound to ask one or two probing questions. The first is whether the matter of inflation has been under consideration, because some of the PoWs have raised that issue. The second is whether the Minister is satisfied that the currency arrangements were adequate and favourable to the men concerned. May I also ask, in a further supplementary question which was one of the purposes of putting down my original Question, whether, in view of the continued existence of PoWs after 1945—a state of affairs which continued for several years while the Attlee Government was in office—there is anything in the Cabinet records (which, obviously, are at the disposal of the noble Lord) to indicate that, either at the War Office when I was present as Secretary of State for War or at the Ministry of Defence when I was Minister of Defence, the matter was ever brought to my notice?
I had no opportunity of responding in any fashion to the requests made by ex-PoWs and, therefore, in no way can it be urged that the Attlee Government was responsible. In fact, I cannot recall the matter ever being raised at a Cabinet meeting; and I came to the conclusion that the matter was being dealt with by the Treasury—than which nothing could have been worse for the men concerned! It seems to me that in all the circumstances
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the Government are doing the right thing. I would hope—although there may be some cases which are somewhat doubtful—that, where people are living under difficult and straitened circumstances, the Government will exercise the utmost tolerance.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am most grateful to the noble Lord for his extremely understanding response, particularly in view of the fact that he has not yet had the opportunity to read the report. The sentiments that he expresses are exactly those which are expressed in this report. I can reassure him on one point: I do not believe that his name appears in the report in any way. I can also assure him that my honourable friend has taken a lot of trouble to check on what records were available. I think that I shall have to inquire of my honourable friend regarding Cabinet minutes. The question of inflation does not really arise once one assumes that the arrangements were properly administered at the time; and the question of the worthlessness or otherwise of camp currency is one of the matters which is addressed in the report.
Lord LOVAT: My Lords, while welcoming some of the Minister's answers to the Question of the noble Lord, Lord Shinwell, may I question him on the fact that a great many people died on the Burma road who were prisoners of Japan, and a great many more, now in late middle age, are suffering ill-health which does not help them when we consider the rate of inflation at the present time.
Lord STRATHCONA and MOUNT ROYAL: My Lords, the noble Lord is referring to exactly the point to which I was addressing myself in the last paragraph of my Answer, which is to say that really we would be better advised now to look at what is happening today rather than try to rake over too many of the events of past history.
Baroness AIREY of ABINGDON: My Lords, while thanking the Minister for his reply, particularly the last sentence, may I ask him whether he is aware that there were a large number of omissions, and that many letters have been received about this? May I ask that a fund should be set

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up to rectify this, and that the greatest possible publicity should be given to this fund? The greatest possible help should be given to those prisoners of war who are suffering disabilities as a result of their imprisonment.
Lord STRATHCONA and MOUNT ROYAL: My Lords, whether there were a large number of commissions is one of the difficulties. Certainly it is true that there must have been some omissions—if "omissions" is the right word. It is quite impossible now to establish that total fairness applied to everybody. That is admitted. On my friend's suggestion about the fund, I am sure that that is the kind of issue that my honourable friend intends to look into in the inquiry he has promised. With regard to publicity, he is meeting the members of the press at this moment to discuss these questions.
Lord SHIN WELL: My Lords, following the question put by the noble Baroness, Lady Airey of Abingdon—a most appropriate question in the circumstances, if I may say so—may I ask whether the Minister could state what funds are there in the Treasury which could be made available? Is there any part of the fund which could be utilised for the purposes suggested by the noble Baroness?
Lord STRATHCONA and MOUNT ROYAL: My Lords, the noble Lord was a Minister long enough to know that there are never any funds available in the Treasury for anything!
Baroness AIREY of ABINGDON: My Lords, if I were to put down a Question on the situation of the other ranks on this matter, would the noble Lord the Minister be kind enough to inquire what the views of the Government would be on this?
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am very glad that my noble friend recognises that the other ranks is a different question. Of course I shall be happy to answer any Question that she puts down.
Lord LOVAT: My Lords, is the Minister aware that there are old comrades associations in every regiment? They can certainly supply him with a list of old
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soldiers and old comrades who are suffering from disabilities.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am sure that is true.
Lady SEMPILL: My Lords, will the Minister consider the wives who were widowed during the time that their husbands were imprisoned in Germany?
Lord STRATHCONA and MOUNT ROYAL: My Lords, Yes. This is again a matter that could be included in any inquiry.

CIVIL AVIATION BILL
11.25 a.m.
Read 3a, with the amendments.
Lord PONSONBY of SHULBREDE Lord PONSONBY of SHULBREDE moved the following amendment:
After Clause 22, insert the following new clause:
"Aviation Security Fund
( . After subsection (3) of section 1 of the Civil Aviation Act 1978 there shall be inserted the following subsection:—
"(3B) The Secretary of State shall prepare a report before 31st July each year on the control and management of the Fund during the last financial year, and each such annual report shall include a general survey of developments, during the period to which it relates, in respect of matters falling within the scope of his functions, and in particular

(a) information that has been supplied to users' representatives;

(b) a forecast of developments likely to affect future income and expenditure; and

(c) a summary of measures taken to promote efficiency and economy in the protection and policing operations in respect of which expenditure is reimbursed under subsection (2) above;

and a copy of each such report shall be laid before each House of Parliament and shall be published."").
The noble Lord said: My Lords, this amendment deals with the subject of security expenditure, which I raised in a different form in successive amendments at Committee and Report stages of the Bill. The concern of airlines and other users at this growing expenditure—now some £38 million—was fully outlined at these stages and I will not weary the House with the details of that again. Suffice it to say that neither the Government, we

721
on this Bench, nor the airlines, are satisfied that the present system gives airport authorities adequate incentives to contain expenditure on searching and security operations.
Your Lordships will recall that the cost of these security services has continued to rise at an alarming rate. The charge is now some £1·60 per passenger and the problem is how to introduce incentives to keep this cost down. Much of the criticisms by the users who must pay the charges can be attributed directly to the lack of adequate information about cost allocation, manpower levels, and so forth. Inquiries to the British Airports Authority are constantly referred to the Department of Trade, yet the Secretary of State and his officials are only open to scrutiny for their control and management of the fund when the draft regulations increasing the levy rate are considered by this House and another place. The working group on the fund which the department convenes meets in private. Its papers, which review expenditure in some detail, are marked "restricted". To open up this whole area to public scrutiny would obviously have security implications, and this would be undesirable. But that should not allow Ministers and their officials to operate the system at second-hand as at present, with mounting dissatisfaction among the users.
At Committee stage, I sought to remedy this gap by the establishment of review committees of airline and airport representatives at each airport. The noble Lord opposed these as imposing too bureaucratic a burden; he suggested that the existing machinery was adequate. At Report stage 1 tabled an amendment to write into the 1978 Act a duty on the Secretary of State to satisfy himself as to the propriety of reimbursements from the fund and to secure maximum efficiency and economy from airport authorities. The noble Lord regarded this, too, as unnecessary.
It is partly because of the fact that users' dissatisfaction with the present system remains that I have tabled this amendment today, and partly because the Secretary of State does not appear to be directly accountable for its operation. This amendment would write into the Civil Aviation Act 1978 a requirement on the Secretary of
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State to make an annual report to Parliament on the performance of its functions relating to the aviation security fund, and would also require him to make available more background information than hitherto.
This should not be thought to be unnecessary or even burdensome. It is necessary because there is simply no other report or summary of this kind. The British Airports Authority produces a long annual report. Despite the fact that 27 per cent. of its personnel are now deployed in searching and security duties, minimal reference is made to these operations in its report. There were three paragraphs in the 1977 to 1978 report; four in the 1978 to 1979 report, and only two in the 1979 to 1980 report. It is true, as the noble Lord reminded the House on Report stage, that the accounts of the fund are prepared by his department and are then examined by the Comptroller and. Auditor-General. But the accounts for the fund's first year, 1978–79, appeared only this summer, 12 months after the end of the financial year, and are in any case a very bald statement of the income and expenditure involved, with an accompanying foreword of a mere 12 sentences.
Nor should this requirement be thought burdensome. Much of the information that would be contained in each report would have been supplied already in papers provided for the working group. Indeed, on occasion some of it has been supplied to Members of this House and of another place during the consideration of draft regulations. The production of an annual report would simply bring all the relevant facts and financial and statistical information together, and allow Parliament and the public to be better informed and to make better-informed judgments about the management of security expenditure and future developments expected. I should have thought that this amendment would not be unduly burdensome. I beg to move.
11.32 a.m.
Earl AMHERST: My Lords, may I intervene before the noble Minister replies, to say that we support this amendment in that it particularly applies to charges for security and search. The airlines are billed with these charges and in turn,

723
generally speaking, they pass them on to the passenger, so that the charges are included in the cost of the ticket. Therefore the cost of these charges impinges on the consumer. As the matter now stands, these charges are given as a lump sum, with no further explanation. I think that consumers have good reason to expect a better explanation of how these charges are assessed, arranged and generally administered. Therefore I think that this amendment goes a long way towards securing a better explanation.
Baroness BURTON of COVENTRY: My Lords, I shall support my noble friend on this amendment. I should like to make one or two remarks concerning security charges. I listened to what my noble friend Lord Ponsonby said on Committee stage and again on Report. The amendment we are considering today, I think, is similar to that moved on Report. Also, I looked this morning at what the noble Lord, Lord Trefgarne, had said in reply. I do not know whether he is going to make exactly the same answer again, if he is going to turn down my noble friend's request; but what I think I am entitled to say is that both Front Benches in both Houses are responsible for these security charges. I leave it at that and I think that the noble Lord, Lord Trefgarne, would expect me to come back to that.
However, the House will recall that it was in this House and in this House alone—because the matter was not even discussed on Committee stage in another place—that objection was taken to the security charges, and indeed we lost in that debate by only two votes. I know two votes is a lot, but we did only lose by two votes, and I should like to reiterate once more that it is my view—I certainly think it is the view of the airlines, and I should have thought that it was that of most people, apart from those who sit on the Front Benches on both sides of the House—that security charges are the responsibility of the state and are not the responsibility of individual citizens. At any rate, the airlines are obviously very disturbed not only at the way security charges were imposed, but also at the way they have increased and at, if I may most politely term it, the inadequate accountability in respect of them.
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I very much regret that we did not get anywhere on those security charges, and I regret it while paying a tribute to British Airways. I remember saying, when this matter was raised in the House, that on the matter of air policy the United Kingdom and British Airways were reckoned to lead the way in Europe and other countries looked to us in this respect. Unfortunately, we led the way in imposing security charges in this manner. I also remember at that time that none of our colleagues in the EEC had security charges imposed upon them in this way.
I should like to support this amendment. I disagree with the security charges being imposed in this way, but I disagree most vehemently, as I think my noble friend Lord Ponsonby did, with the lack of accountability to the airlines. I therefore have pleasure in supporting the amendment.
Lord BESWICK: My Lords, I should like to support the amendment and to suggest to your Lordships that it is really a challenge to the judgment of those of your Lordships who have bothered to stay here this Friday. The noble Lord moved his amendment in the most constructive terms. It is not one which in any way impeaches the principle of the Bill. It does not endeavour to overturn a policy with which we disagree. It is endeavouring to introduce some responsibility and to have a very proper sense of discipline in an area where it is eminently difficult to get discipline.
There are many here who will know that security services feed upon their own importance, and there are many who will know that it is very difficult to control expenditure when you are dealing with security. I have known, as no doubt others have known, that when something is difficult to explain you have only to mutter that it is something to do with security and you get away with it. I think that here is a case where it would be advisable to have a much more open sense of accountability. The noble Lord has moved his amendment before in similar terms. He now comes along with something which is eminently sensible and eminently constructive, and I should like to think that your Lordships would support his amendment this morning if he presses it to a Division.
11.37 a.m.
Lord TREFGARNE: My Lords, may I say at the outset that I fully appreciate the concerns which lie behind this amendment. The first is that users should have information on the costs that are being incurred on security and forecasts of developments likely to affect future income and expenditure. May I repeat what I said during Committee stage and again on Report?—that the Department of Trade make a great deal of financial information available to the Working Group on the Aviation Security Fund, which includes user representatives and also a representative of the Air Transport Users' Committee. May I, by way of example, describe a paper which was circulated by the department to the working group about two weeks ago, in order to demonstrate how much information is made available? The paper sets out total income and expenditure under various headings for last year, together with estimates for this year and next. Costs for last year for each individual airport are given. Significant variations in manning levels, compared with a year previously are noted, and all major wage awards over the last year are recorded. Assumptions regarding future wage awards and manning levels are specified, and traffic forecasts are discussed.
The working group will have the opportunity to challenge and seek clarification of all this at a meeting next week. I have also mentioned in an earlier debate that at Heathrow a Search Liaison Sub-Committee has been set up by the BAA to discuss matters such as manning levels and anything else the airlines may wish to raise. There are in addition security committees at every airport, where security operations and their efficiency can be discussed.
The other major concern reflected in the amendment is that security measures should be undertaken efficiently and economically. I again reiterate that the department takes very seriously indeed the need for economy. I would remind your Lordships that the department recently participated in a full-scale review of the security arrangements at Heathrow Terminal 3. It is currently looking at the feasibility of centralising searching at Gatwick and it has been examining closely
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the BAA's establishment figures for Terminals 1 and 2 at Heathrow.
All this said, I very much doubt that imposing a requirement on the Secretary of State to lay an annual report before Parliament as defined in the amendment will in practice confer any extra advantage on users at all. I would stress, however, that there is no intention to deny Parliament information. The accounts of the Aviation Security Fund are laid before Parliament annually, in accordance with Section 1(3) of the Civil Aviation Act 1978, and the department has adopted the practice in the past, and will continue it in the future, of placing in the Libraries of both Houses of Parliament a paper giving the kind of information that I mentioned just now whenever amendment regulations to increase the levy rate are put before Parliament.
I would also mention, in passing, a small imperfection in the amendment, although I confess it is no more than that, in that it would require the annual report to be prepared by 31st July each year. The fund operates several months in arrears and our experience is that some claims for the previous financial year do not arrive until August. It would, therefore, be difficult to present a completely accurate picture of the previous year's finances as early as the end of July.
If I may now touch on one or two points made by various noble Lords and noble Baronesses who spoke earlier, the noble Baroness, Lady Burton, referred to the increase in charges which your Lordships authorised last year. That, if my memory serves me right, was a very substantial increase from 85p to, I think, £1.60. But that large increase was made necessary by a deficit which the fund had acquired, resulting from a significant under-charging in previous years. While I am not in a position to forecast what increase, if any, will be necessary for next year, I cannot think it will be anything like that kind of order.
The noble Lord, Lord Beswick, referred to the merit of the amendment, as he saw it. In particular, he asked me to consider that the principle of the Bill was not breached by the acceptance of this amendment. Indeed not, my Lords, but the noble Lord might wish to consider whether the principle of the earlier Act,

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which established the security fund in 1978, would be compromised by this amendment.
The department is doing a great deal under the present non-statutory arrangements to meet the concerns of users. It has every intention of continuing and developing these arrangements in the future. I do not think that a requirement to prepare a report, in addition to the annual account which is already laid before Parliament, will, in itself, be of particular benefit to airlines and at this late stage of the Bill I ask your Lordships to reject the amendment.
Lord PONSONBY of SHULBREDE: My Lords, I thank the noble Lord for his reply. I have been encouraged by the support which I have received from this side of the House and, although it had not been my original intention to press this amendment to a Division, I now intend to so do.
We are dealing with the question of public information. The Government are seeking to hide behind a cloak of secrecy. The noble Lord said that certain information is made available, but that is inadequate so far as those who are paying into this fund are concerned. Unless they can have satisfaction, we shall not get anywhere on this.
I have tried on two occasions to come forward with constructive suggestions as to how these difficulties might be overcome. On both of those occasions, the noble Lord rejected the suggestions. In all the circumstances, I should have thought—and I hope that your Lordships in all parts of the House will agree—that the suggestions which I have made today were eminently sensible.
11.44 a. m.
On Question, Whether the amendment shall be agreed to?
Their Lordships divided: Contents, 58; Not-Contents, 61.

CONTENTS

Airedale, L.

Gladwyn, L.

Mishcon, L.

Amherst, E.

Gordon-Walker, L.

Oram, L.

Ampthill, L.

Gosford, E.

Peart, L.

Ardwick, L.

Granville of Eye, L.

Plant, L.

Banks, L.

Gregson, L.

Ponsonby of Shulbrede, L.

Beaumont of Whitley, L.

Grey, E.

Robbins, L.

Bernstein, L.

Hale, L.

Roberthall, L.

Beswick, L.

Halsbury, E.

Saint Brides, L.

Boothby, L.

Hanworth, V.

St. Davids, V.

Boston of Faversham, L.

Hatch of Lusby, L.

Segal, L.

Brockway, L.

Henderson, L.

Shinwell, L.

Bruce of Donington, L.

Houghton of Sowerby, L.

Simon, V.

Burton of Coventry, B.

Jeger, B.

Stamp, L.

Collison, L.

Leatherland, L.

Stedman, B.

Cooper of Stockton Heath, L.

Listowel, E.

Strabolgi, L.

Crook, L.

Llewelyn-Davies of Hastoe, B.

Taylor of Blackburn, L.

David, B. [Teller.]

Lloyd of Kilgerran, L.

Underhill, L.

Gaitskell, B.

Longford, E.

Wallace of Coslany, L. [Teller.]

Galpern, L.

Meston, L.

Winstanley, L.

Wynne-Jones, L.

NOT-CONTENTS

Ailesbury, M.

Fraser of Kilmorack, L.

Morris, L.

Airey of Abingdon, B.

Gainford, L.

Mowbray and Stourton, L.

Alexander of Tunis, E.

Gowrie, E.

Murton of Lindisfarne, L.

Auckland, L.

Greenway, L.

Newall, L.

Avon, E.

Grimston of Westbury, L.

Nugent of Guildford, L.

Bessborough, E.

Ironside, L.

Nunburnholme, L.

Boyd of Merton, V.

Kilmarnock, L.

O'Neill of the Maine, L.

Caccia, L.

Kinloss, Ly.

Porritt, L.

Clancarty, E.

Kinnaird, L.

Renton, L.

Cork and Orrery, E.

Lauderdale, E.

Sandford, L.

Cullen of Ashbourne, L.

Lindsey and Abingdon, E.

Sandys, L. [Teller.]

Davidson, V.

Long, V.

Sempill, Ly.

De Freyne, L.

Lovat, L.

Soames, L. [L. President.]

Denham, L. [Teller.]

Lucas of Chilworth, L.

Spens, L.

Drumalbyn, L.

Lyell, L.

Strathcona and Mount Royal, L.

Duncan-Sandys, L.

McFadzean, L.

Swansea, L.

Eccles, V.

Macleod of Borve, B.

Trefgarne, L.

Effingham, E.

Mancroft, L.

Trumpington, B.

Ellenborough, L.

Marley, L.

Vaux of Harrowden, L.

Ferrers, E.

Monk Bretton, L.

Vivian, L.

Westbury, L.

Resolved in the negative, and amendment disagreed to accordingly.
11.52 a.m.
Lord TREFGARNE: My Lords, I beg to move that this Bill do now pass. I believe that in our previous debates we have indeed done proper justice to this important Bill. Although there have been some differences between us, I sense a general sympathy for the view that civil aviation is an industry subject to continual development and change and that our attitudes must change with it.
We have been fortunate in numbering among noble Lords who have spoken some who have had experience of the industry at first hand. While the Government may not have been able to accept all of their arguments, our debates would have been the poorer without their contribution. I think that every aspect of the Bill has been dealt with at the various stages of our proceedings. I will not therefore labour all the details again on this occasion, but perhaps I may recapitulate the Bill's main objectives and explain why the Government believe that those objectives are important.
I spoke just now of change. There may in the past have been arguments to support a nationalised industry structure for British Airways, but we are firmly convinced that this is no longer the case. Unlike the public utilities, British Airways is not a monopoly. It has to compete in a market which is essentially international. It has to compete not only against foreign carriers but also against domestic airlines which have come a long way in recent years and are now substantial businesses. The competition from all sides gets fiercer every day. That is a healthy situation and certainly one from which the consumer has benefited.
Naturally, we expect British Airways to compete effectively in this environment, but to do so we believe that they should be put on precisely the same commercial footing as other British airlines, none of which is subject to the controls currently exercised by the Government over British Airways. Part I of the Bill therefore represents freedom for British Airways to operate without these constraints. Instead, it will be able to operate as a proper private sector company whose fortunes are entirely in its own hands. Although
730
the Government will hold a majority of the shares following the initial flotation, we shall not seek to control or interfere in the company's activities in any way.
It is unfortunate that we shall not be able to grant British Airways this freedom as soon as we should have wished. However, the recent announcement that a flotation will not take place in 1981 is perfectly consistent with the undertakings which have been given on a number of occasions that we shall not sell shares until we consider the time is right, taking into account the interests of all concerned. The Government would have been rightly criticised had we tried to ignore the fact that the airline industry world wide is in a recession and that British Airways' own level of profitability is at present considerably below original forecasts.
We fully accept that you cannot launch a successful sale of shares against that background. We have therefore made provision for the airline's financial stability for the present by increasing the statutory borrowing limit under what now forms Clause 2 of the Bill. I should, however, leave your Lordships in no doubt that it is our intention to proceed with the change of status for the airline and subsequent sale of shares as soon as the air transport market and British Airways' own prospects have improved sufficiently for us to arrange a successful flotation.
I come now to the provisions of Part II of the Bill. We have ranged widely in our debates on Part II and I hope that on most questions which have arisen I have succeeded in explaining the Government's policies. Certainly I do not wish again to go over ground which has already been sufficiently covered. However, I should like to add a few remarks on the most important clauses in this part of the Bill, 12 and 13, in order to remove any doubts as to the Government's intentions.
The central purpose of Clause 12, which sets out the Civil Aviation Authority's objectives in primary legislation, is to ensure that in future one of the authority's major concerns will be to foster the interests of consumers—that is, the users of airline services. This is to be achieved principally by two changes in the Civil Aviation Act 1971. First, Clause 12 will strengthen the authority's

731
existing duty to further the reasonable interests of consumers of transport services by placing that duty on an equal footing with the authority's other general objectives, as amended by Clause 12. The effect of these changes will be to give to the CAA two all-embracing objectives: first, to ensure that British airlines satisfy all substantial categories of demand at the lowest charges, consistent with a high degree of safety, a reasonable return to the operator and the sound development of the domestic industry; and, secondly, to further the interests of airline users. Taken together, I think these broad objectives make plain the importance which the CAA is obliged to attach to meeting the needs of the airline users.
Secondly, the consumers' interests will be advanced by subsection (2) of the new Section 23A which is inserted into the 1971 Act by Clause 12. This subsection is designed to eliminate any doubts as to the CAA's duty to take fully into account the benefits to airline users which may arise from the introduction of competition. It establishes that the authority, when considering air licensing applications, shall have regard in particular to the benefits which may follow from permitting two or more operators to provide services on the same route.
Finally, it is recognised that the removal of the Secretary of State's power to give guidance and the setting out of the CAA's duties and objectives in primary legislation will change in some measure the existing régime with which the CAA, the industry and consumers are familiar. Clause 12 of the Bill will therefore not enter into force until the authority has complied with the requirement in Clause 13, that it shall publish an account of the policies it intends to adopt in the light of the new provisions relating to its air transport licensing duties. This will ensure that the airlines and air travellers have the opportunity to study the interpretation which the CAA intends to place upon its new duties when making air transport licensing decisions.
Clause 13 also requires the CAA to consult with representatives of the industry and users of airline services before it makes a statement of its policies so that both parties will have the opportunity to comment on the authority's
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proposals at an early stage. These provisions provide an orderly procedure for giving effect to the changes which the Bill will make in existing arrangements. My Lords, I believe that this measure will materially improve the position of the United Kingdom civil aviation industry. I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(Lord Trefgarne.)
11.59 a.m.
Lord PONSONBY of SHULBREDE: My Lords, the civil aviation industry is going through a difficult time. During the passage of the Bill I have wondered how relevant this Bill is to the problems of the industry. As a result of the passage of this Bill, British Airways have been faced with a new uncertainty, in that they do not know whether they are within or without the public domain. They know that that uncertainty is going to continue for a considerable period of time because, as the Government have stated, there will be no flotation of British Airways in 1981; indeed, it may not be until 1982, 1983 or beyond that a flotation is finally made. Although the Government have indicated that they intend to retain a 51 per cent. shareholding in British Airways, after the initial directors have been appointed they are not going to appoint any directors themselves; although in contrast to that, when we discussed the new British Aerospace Corporation we learned that there are to be two Government-appointed directors on the board of British Aerospace.
As I have said, it is a time of uncertainty, a difficult situation for the whole commercial world of aviation. Airlines will necessarily examine in detail all the costs which they are being called upon to meet. During the course of this Bill we have examined the question of landing charges imposed by the British Airports Authority, air navigation charges and security charges. We have examined these at some length, but I fear that our examination will have produced no comfort for the airlines. The Government's tight control of the finances of the British Airports Authority, which has forced up landing fees; their failure to grapple with the problems of Eurocontrol; their failure to satisfy the airlines with regard to the security charges which they are being asked to meet,

733
cannot help the aviation industry and cannot help the right decisions to be made in that industry for the benefit of this country.
I have often voiced concern about the premier position which London occupies in the European aviation situation. I have voiced concern that the present policies being pursued by the authorities and by the Government will have the effect of driving airlines to use other airports outside those within the London area. I know it is said that a move to Gatwick is what is being aimed for, but very often it will not be a move to Gatwick; it will be a move to Amsterdam or to Paris or to an intercontinental airport. Therefore I do not see that the aviation industry can have any comfort at all from this Bill.
I should have been very much happier if at least one of our amendments had been accepted. But the Government have maintained a rigid attitude against any amendment of any sort in the Bill. A few minutes ago they almost came a cropper on a very minor amendment about security charges. Having said that, and very much in contrast to that, I should like to thank the noble Lord, Lord Trefgarne, for his courtesy and good humour during our consideration of the Bill. I wish it had extended to an element of flexibility.
12.4 p.m.
Baroness BURTON of COVENTRY: My Lords, before the Bill leaves us I should like to comment on one particular aspect—that of the consumer and what has come out in this Bill. On Second Reading and in Committee I asked the Government whether they could consider two points. The first was whether they would widen the remit of the Airline Users' Committee to include airports. That is where most of the problems arise concerning travellers. I was very glad at Second Reading to have support on this aspect from the noble Lord, Lord Boyd-Carpenter. The Government did consider this suggestion and they wrote to me at considerable length about it. I appreciated the care taken, but they did turn down the suggestion and I venture to think that was a mistake.
The second point I raised was to ask for an assurance that consumers of air travel, or the air travellers, would be included in the review which currently
734
is being undertaken by the Minister, Mrs. Oppenheim, concerning the position of consumers vis-à-vis the nationalised industries. I was glad to receive an assurance the other day from the noble Viscount, Lord Trenchard, that indeed this was to be the case. But I am not entirely happy. It may be that after several years of struggling on this issue I am unduly suspicious, but I am not too happy as to what I think may be the outcome of that.
Leaving that particular issue, when this Bill appeared, I was grateful to see the support given by the Secretary of State, Mr. Nott, to the viewpoint that the interests of consumers should be lifted to a much higher level, if that is the correct term, than they were in 1971. Mr. Nott supported this in the House, and Mr. Norman Tebbit said—I think I am quoting his words correctly—that they should advance the consumers in the pecking order. Obviously the viewpoint of the Secretary of State quite rightly carries much more weight than mine does; but I still think he is wrong on this particular aspect. Some of us have worked on this matter for many years, with the support of this House. It would not have been possible in the Commons to carry matters as far and as persistently as we have done in this House, through question and answer, and I should like to thank the House. It is due to this House, first of all, that we have got the Airline Users' Committee; but I will not go back over that.
What really disturbs me on this particular matter, apart from any merits or demerits, and what I venture to suggest from the background of experience is that we have far too many committees dealing with this problem. Each committee has its own amour propre and if anybody wants to step outside and do something that another committee thinks it should do, we make exactly no progress whatsoever. Airline travellers really are not concerned with this multiplicity of committees; they want their matters dealt with.
I wish to be fair because I think that the noble Lord, Lord Trefgarne, also is fair. He has mentioned today various points where he hopes the cause of the consumer will be helped; I want to study those. But I do not feel we have had any help on this particular matter. I

735
want to assure him that if the matter of the multiplicity of committees and these demarcation problems are not settled we shall make no progress whatsoever. That is why I asked at both stages that there should be one committee—it happened to be the Airline Users' Committee; but, honestly, I do not care which committee it is—charged with the responsibility of looking after passengers at airports. Travellers do not realise that they belong to several committees. They buy their tickets from the airline and they think the airline is responsible for them. Of course it is, in the air. Once one gets out to Heathrow the airline is not responsible for one; it is the British Airports Authority, and that is a totally different kettle of fish. I will leave it at that. It is a totally different proposition.
Even if the noble Lord cannot agree with it, I should like him to bear this in mind because, really and truly, until one committee is given overriding authority for dealing with passengers at airports we shall make no progress whatsoever. Before I sit down, I should like to thank the noble Lord, Lord Trefgarne, who is helpful not only in this House but in conversations outside it. I do not wish to embarrass him by saving that I think he may have sympathy with what I have to say; at any rate that is the feeling with which I have been left. I wish he could have gone further. Of course we shall return to this point. I hope I am wrong about the demarcation problems, but I do not think I am. I wish the Bill well.
12.10 p.m.
Lord BESWICK: My Lords, I should like to add my tribute to the noble Lord, Lord Trefgarne, for his handling of this Bill. He has combined courtesy with skill in splendid degree and his knowledge of the detail has been most impressive. I recall that he flew in from some foreign mission the day before he had to introduce the Bill, and he could have been forgiven for some unfamiliarity with it. But in fact it sounded for all the world as if he might have written it. I like to think that if he had had that responsibility he would have made a better job of it. It is a bad little Bill and in an overloaded parliament timetable it ought never to have been included. There is only one clause in the whole of the Bill which
736
has any relevance to the problem of the day—that is, the one referring to the borrowing requirements—and that was spatchcocked in halfway through the proceedings.
My Lords, I and others in this House have seen many Governments since the war: they have all been open to criticism, they have all been the victim of inherited problems, but I do not believe there is one Government which has proclaimed its objectives so stridently and yet so conspicuously failed to achieve them. They said they were dedicated to reducing the rate of inflation—and they promptly doubled it; they said that everything depended upon controlling the money supply—it got out of hand; they proclaimed the virtues of hard work—and two million people under their administration are denied the opportunity of working at all; they said that our national flag-carrier, British Airways, would do much better if it was floated on the stock market and yet before the Bill was on the statute book they had to come along here and say, "We are sorry, it is not possible. It cannot be done for two years"—and that virtually means not at all.
Part II of the Bill was supposed to enhance the status of the Civil Aviation Authority. The Government said that under their dispensation the authority was going to be an authority not to be meddled with by a Government department. No sooner had they said that than they began immediately to undermine the position of the authority by overriding the decisions that had been taken.
I have no doubt that the Bill will now go on the statute book unamended in all respects so far as we are concerned—not as a result of the weight of argument but of the dead weight of a predetermined majority. I pay tribute to the noble Lord's capability; I should like to think that in the future it will be put to better purpose.
12.13 p.m.
Lord TREFGARNE: My Lords, I am obliged to all the noble Lords and the noble Baroness who have spoken, but I am sorry that the two noble Lords who sit on the Front Bench and on the Privy Councillors' Bench opposite have not felt able to welcome more warmly the provisions of this Bill. However, I am happy to

737
think that what the noble Lord, Lord Beswick, foreshadowed, namely that this Bill will shortly become an Act, will in due course come to pass.
Perhaps I may deal with two of the points raised by the noble Baroness, Lady Burton. She referred first of all to the question of the interface—if I may call it that—between the Air Transport Users' Committee and the airport consultative committees. Quite properly the noble Baroness is anxious to ensure that the interests of passengers are clearly and properly represented by one or other of these committees. As the noble Baroness knows, consultations are going on about the interface between those two groups of committees. There is of course an airport consultative committee for each of the major airports and there is one Air Transport Users' Committee. We certainly agree that there is some room for improvement in the relationship between those two bodies and we are holding consultations to see what can be done. I confess that I had hoped to be able to say more about that today, but I am sorry to say that the consultations have not gone as quickly as I mistakenly expected they would and therefore I regret that there is nothing further on that subject that I can say today.
Baroness BURTON of COVENTRY: My Lords, I should like to ask a question of the noble Lord. I am most grateful to him. As he is aware, I was hopeful that there might be something further that he could say on that matter, but perhaps he can help me in this respect: how would the House know the result of such consultations? In other words, can he give me any guidance, either here or outside, as to whether it would be useful to table a Question at an appropriate moment so that the House might benefit from the result of these discussions?
Lord TREFGARNE: My Lords, I was just about to undertake to write to the noble Baroness on this issue. If she would prefer me to answer a Written Question, for example, I should be willing to do that and I will arrange for the noble Baroness to be informed when I am ready to give her a substantive reply to any Question she may table.
Baroness BURTON of COVENTRY: My Lords, I should prefer an oral Question.
Lord TREFGARNE: My Lords, I am in the hands of the noble Baroness and I will answer whatever Question she sees fit to table.
In his speech, the noble Lord, Lord Beswick, suggested that there was no prospect of British Airways ever being floated. I must tell the noble Lord that he is mistaken in that expectation. As I said in my opening remarks, it is certainly our clear intention that as soon as market circumstances permit British Airways will become essentially a private sector company.
Lord BESWICK: My Lords, I think the noble Lord should not be quite so dogmatic about it. When the Bill was introduced, did the Government not have the clear intention to float this company either this year or next year?
Lord TREFGARNE: Indeed we did, my Lords, but the market conditions at this time are not appropriate and that is why we were obliged to announce that this flotation will not take place in 1981. But let the noble Lord and your Lordships be in no doubt that it is our determination to see that that happens.
Noble Lords on all sides of the House have treated me with courtesy and respect and I thank them for the remarks they have made about me.
On Question, Bill passed, and returned to the Commons.

LIMITATION BILL [H.L.]
Returned from the Commons agreed to.
STATUTE LAW REVISION (NORTHERN IRELAND) BILL [H.L.]
Returned from the Commons agreed to.