Trade Union Immunities

HL Deb 01 April 1981 vol 419 cc202-77

3 p.m.

Lord Renton rose to call attention to the Consultative Document on Trade Union Immunities (Cmnd. 8128) and to the merits of possible changes in the present law on these immunities; and to move for Papers.

The noble Lord said: My Lords, this Green Paper was presented to Parliament in January and the Government say that they would welcome by 30th June the views of industry and others concerned on the issues covered in it and the questions raised by Chapters 3 and 4. That consultation would be incomplete without the valuable guidance of your Lordships expressed in this debate, in which we look forward to hearing from noble Lords who were experienced trade union leaders of distinction and other noble Lords with a variety of business and public service experience.

I must stress that I shall be expressing my own views. I do not claim to be speaking for my noble friends, although I dare say that some of them may agree with me. I speak as one who had 34 years' experience in another place, where I had many contacts with both sides of industry and could not have been elected 10 times without the support of many trade unionists. I also think that on this occasion it might be relevant if I were to point out that I had two years as a Parliamentary Secretary in a department in which I was responsible for safety in coal mines. I went down a number of coal mines in England, Scotland and Wales and, if I may say so, I was deeply impressed by the miners—by their friendliness and by the way in which they stood up to the dangers of the life they lead.

The Introduction to this consultative document probably contains the most candidly critical description of our trade unions and their industrial practices ever to emerge from a Government department. Let us, for example, just consider what is said in paragraph 4, which is the only extensive quotation that I propose to make; I can spare your Lordships at any rate many more. It says: The importance of the freedom to combine to withdraw labour in the face of serious grievances at work is not in question. What is questioned is the readiness to threaten and deploy the strike weapon with apparent disregard for the consequences, whether for the future of the enterprises affected, for the jobs and livelihoods of their employees or for the rest of the community …All too often the strike or the threat of a strike is a tactic of first instead of last resort ". The last sentence of that paragraph says: As a result our ability to compete in home and overseas markets has seriously declined ".

A little later on the document examines the legal framework of industrial relations as it now is, and in paragraph 12 it points out: The role of the law remains non-interventionist as it affects trade unions, but it has clearly become more interventionist as it affects employers ". So, it says: … there has developed a widespread public feeling, not least among trade union members, that trade unions have too few obligations and too much power ". But even this candid analysis omits a vital factor which should surely have been included; namely, the vulnerability of such a system to the mischievous power of militant minorities, indeed, sometimes of militant individuals like Red Robbo who, by his own efforts, until dismissed by British Leyland, was said to have cost the nationalised company about £100 million in strikes.

The fact, which is pointed out in this Green Paper, that 90 per cent. of strikes are unofficial, is largely due to the influence of militants, although the document does not attribute the cause of those unofficial strikes to them; but I think that it is a fair inference to make. It is, of course, notorious that the militant tendency—Trotskyists, the Socialist Workers' Party and other revolutionary minorities—is infiltrating the trade unions, the Labour Party and even the Civil and Public Services Association, many of whose members are on strike today.

Of course, the present chaotic system plays into the hands of the militants, and I suggest that something must be done about it. Some fortunate people on both sides of industry say, "Do nothing, at any rate until the Employment Act 1980 has had more time to operate ". But as is mentioned in paragraph 9 of the Green Paper, that Act dealt only with the identified worst abuses. It still left trade unions with wide immunities and immense power, and it left the extremists with a free hand. Those who say "do nothing" quite fairly point to those parts of industry where relations between management and unions are good, where they cosily reach agreement on claims for increased wages but sometimes pass on the cost to the consumer, with or without an increase in productivity. Indeed, I suggest that the pay bargaining system as we have experienced it for a good many years now is a built-in guarantee of inflation unless increased productivity occurs.

Therefore, we have a curate's egg situation and it would be shameful to let it be when so much is at stake. For example, what about the constant threats to the motor-car industry, the docks and Fleet Street? Above all, what about the interruption of essential services provided for the people by Government, by local authorities or by nationalised service industries? So I say that something must be done.

The Government have set out the possibilities of what might be done in Chapters 3 and 4, and although it is a big subject I will go through the various proposals discussed as briefly as possible. I should mention that in Chapter 3, which deals with, "Possible Changes to the Present Law on Immunities ", the first four matters overlap: the immunity for trade union funds, the immunity for secondary industrial action, picketing and definition of a trade dispute. Those are so interconnected that it might perhaps have been easier for me to deal with them as one subject. But I shall take the sequence of the Green Paper itself and attempt, so far as possible, to deal with them separately.

As to the first point—immunity for trade union funds—since 1906 trade unions have, of course, been protected from actions in the courts at the suit of employers or third parties, or anyone else, even when there is no trade dispute. This is a strange relic of a bygone age. But even in 1906 those famous Fabians, Sydney and Beatrice Webb, condemned the immunity of trade union funds as an extraordinary and unlimited immunity, however great may be the damage caused and however unwarranted the act, which most lawyers as well as all employers regard as nothing less than monstrous". So said the Webbs at the time. Since then the unions have of course grown up. They have increased their power. They have increased their standing. I remember that after the Second World War Sir Winston Churchill said, "They have become one of the great estates of the realm ".

Their funds are now enormous. Their income in 1979, I find, added up to £234.6 million, but of that very large sum only 11 per cent, was paid out in benefits to the members, and this was true of the period 1974 to 1979. The rest went in administration, conferences, salaries, and so on. Nevertheless, that is a very considerable sum, and over the years it has enabled the unions to build up quite considerable reserves. At the end of 1979 their investments stood at the figure of £162.7 million, excluding pension funds, of course, which are inviolable. Whether that figure of £162.7 million included the valuable antiques which they have stored, I do not know. Their fixed assets at the end of 1979 were valued at £69.3 million.

So I suggest that the unions should now acknowledge their maturity. They can afford to pay, and their funds should no longer be altogether immune. But of course this overlaps with the next question to which I come—I am following the order of the Green Paper—immunity for secondary action. The Government have not asked for views on immunity in respect of private action. Although it is strongly arguable that all immunity from being sued in tort should now be ended, I shall confine myself under this heading to suggesting that there should no longer be any immunity for secondary action. Strikes have in the last year or two diminished as unemployment has risen, but one day, mercifully, the recession will end. Then, if we are not careful, we shall be back to square one with strikes again a tactic of first resort, with all the damage which results. When that happens, I think we should let it be understood—we can only do this by legislation—that primary action is just about bearable but secondary action is not. If we eliminated secondary action as a form of immunity then that would be a step forward.

I come to the third point—picketing. Last week Mr. Prior said: Although strikes cannot be forbidden by law in a free society, they are as anachronistic as ordeal by battle". A very telling statement. Of course sometimes picketing is scarcely distinguishable from ordeal by battle. The 1980 Act imposed some necessary limitations on picketing, and the code of practice gave some indication of what would be reasonable and what would not. But peaceful secondary picketing is still allowed so long as it is done in contemplation or furtherance of a trade dispute by workers at their own place of work. That is to say, it is not allowed to be done by flying pickets going to places where they are not employed. There is an exception to that rule as I have stated it, which is the present law since the 1980 Act, and that is that a trade union official may be allowed to picket even though he is not employed at a factory, because that is something that was considered reasonable at that time.

In the recent dock strike, the law, which should be enforced, has been flouted, in that flying pickets have gone from one set of docks to another. That is in defiance of the 1980 Act. I suggest that sooner or later all secondary picketing should be made illegal. We shall meanwhile have to see how Mr. Prior's code of practice deals with the situations which will arise from time to time.

Now I come to definition of a trade dispute, which is pretty fundamental in considering the present law. The present definition includes not only disputes between employers and workers but also between workers and workers, which we all know too well from the Isle of Grain dispute and the Hunterston dispute which were so costly. The present definition is directly and tremendously broadened by the definition of "associated employer" which is to be found in Section 30(5) of the 1974 Act. I suggest to the Government that the present definition of a trade dispute should be narrowed in the two ways that I have mentioned.

As to legally enforceable collective agreements, I find it surprising that there is no mention in the Green Paper of statutory contracts of employment, which were first introduced at the behest of the trade unions by the Macmillan Government. I remember the measure very well. It was called the Contracts of Employment Act at first, but it is now consolidated into the Employment Protection Act 1978. Those statutory contracts of employment oblige employers to give legally binding contracts in writing upon which they can be sued.

I think that that is relevant to the question as to whether it might be feasible to have collective agreements in this country. Other civilised countries operate them without trouble, and I suggest that it should now be the subject of deep discussion between the CBI and the TUC. It could be achieved by voluntary agreement between them, although when it comes to be applied in practice there would have to be agreement between particular unions and particular employers or employers' organisations. That we must understand. It may not yet be suitable for legislation, but on the principle of the step-by-step approach that might well be a next step to be encouraged.

Now, secret ballots. Surely they should become compulsory for election to all union appointments from shop stewards upwards. There is no problem about this. We know of many small bodies where secret ballots take place. We may be familiar with them on both sides of your Lordships' House. There is no need for us to make heavy weather about it. It can quite easily be done. It would be the best way of preventing militants from destroying our unions, our industry and our society, which they are instructed to do.

As to closed shops, I have nothing to add to what was said last Wednesday in the excellent debate initiated by the noble Lord, Lord Harris of Greenwich, except to point out that the constitutional independence of our Civil Service, on which good government depends, could be threatened if the closed shop were insisted upon for all civil servants. I am sure that we all look forward to hearing from the noble Lord, Lord Houghton of Sowerby, who has such great experience of the work of the Civil Service.

I come to the last and, in my opinion, most important of the matters raised in Chapter 3, the protection of the community, especially in regard to essential services. There are of course powers under the present law to deal with national emergencies, but I do not think those concerned should be entitled to force a Government to use those powers. I suggest that workers in certain essential jobs should accept as a condition of service that they will not strike. The armed forces and police already have to accept that, and that does not stop them from being well paid. In my view firemen should also accept it, and so should key people in the electricity, gas, water and sewerage services, and people who work in hospitals or in children's or old people's homes.

I suggest, too, that the Civil Service should also be under an obligation not to strike. Public service—serving one's Queen and country—is both a privilege and an advantage, and there is no need for a quid pro quo in the form, for example, of arbitration in return for accepting the obligation not to strike. There are many who hold the view, as I do, that the Civil Service are well paid and have been for a good many years, and have good pensions. It is surely scandalous that London Airport can be closed down by, it seems, a message from a trade union official, something that cannot be done by anyone else, not even the Prime Minister or the chairman of the Civil Aviation Authority. On this question of essential services, they do better in some other countries, as we can learn from the Appendix.

Chapter 4 invites us to consider an alternative system of positive rights instead of the present system of immunities. Of course, that would be finality—the end of the step-by-step approach—and it would be some years before such a system could be negotiated and carried into law. In any event, I am sceptical about that as an alternative, for I fear that positive rights would merely be immunities writ large and writ permanently. Therefore I conclude by recommending that in the next Session of this Parliament—it will be too late after that—the Government should take the necessary next step in the step-by-step approach by introducing legislation on as many as possible of the matters referred to in Chapter 3. If that is done, Mr. Prior will have shown himself to be firm and decisive, and that is what the nation—including millions of members of trade unions—wants.

Lord Balogh

My Lords, before the noble Lord sits down, may I ask him to tell us whether he considers that what he must have known would be a very provocative speech will contribute to a civilised and peaceful solution of the absolutely overwhelming problem of incomes and prices?

Lord Renton

It is a matter of opinion whether my speech was provocative, my Lords, and it was certainly not intended to be. It was intended to be a constructive contribution to an extremely difficult problem which has worried the people of this country for a long time. My Lords, I beg to move for Papers.

3.25 p.m.

Lord McCarthy

My Lords, I wish at the outset to thank the noble Lord, Lord Renton, for giving us this opportunity to debate the Green Paper. I do so personally particularly because I was sad not to be here last week when the House discussed the closed shop, a subject I always like to debate. As I shall point out, it is most appropriate for a number of reasons that we should be discussing the Government's Green Paper on Ail Fools' Day. I am enthusiastic to discuss the Green Paper and I am keen that we should bring out many of its issues; and we on this side may be slightly more enthusiastic than noble Lords opposite that the issues in it should have a full and frank discussion.

It is significant that in the Green Paper there are no specific proposals—most unusual for a Green Paper. It is significant that although we know that the consultative process is still going on, we are in the debt of a Back-Bencher opposite for the opportunity of discussing the Green Paper, and I am glad we are doing so. But having thanked the noble Lord and congratulated him for bringing the subject to our attention, I am afraid I must tell him—this will not come as a surprise to him—that I could not agree with the central thrust of his argument.

As I understood it, he was saying, and he said it several times, "We must do something "and" Something must be done ". I seem to remember that we spent a very considerable time indeed last Session trying to do something; it was called the Employment Act 1980 and it had a whole range of complicated and difficult provisions which we were kept up late into the night discussing. Thus, it is not a question of something being done but, rather, a question whether something more should be done. It is a question whether something more should be done in a particular direction at a time when we have absolutely no idea what the courts will make of what has been done. Nobody can say how the courts will interpret the complicated guidelines on secondary action; or how the complicated questions of the closed shop illegalities will turn out; or how off-site picketing will be interpreted; or whether actions will be brought at all and, if they are, whether they will be successful. Therefore, what we are being asked is not whether something should be done but whether something more should be done now, before we have the slightest idea of what will happen as a result of what has been done already.

If I followed the central thrust of what the noble Lord said, he seemed to be arguing that there was something novel in the arguments of the Green Paper—something different and something especially coercively persuasive. A long time ago, when the world was young, the Secretary of State for Employment and Productivity, as she was then called, was wondering what to do about the report of the Donovan Commission. As was her wont, she held a conference at Sunningdale, when two papers were prepared. The first, which I prepared myself, said we should follow the prescriptions of the Donovan Commission; that since our central problem was defective bargaining institutions and not the legal rights of trade unions, that was where we should emphasise our way forward.

But a second paper was prepared by the department, entitled An Alternative Approach, and in that paper a list of proposals for restricting trade union immunities in all kinds of directions—dealing with the monopoly position of the closed shop, the legal enforcement of collective agreements, trade union immunities in tort and so on—was advanced. Only three of those proposals survived in the notorious penal clauses of In Place of Strife. But, your Lordships will be pleased to know, the Department of Employment wastes nothing. It is a very careful department, and therefore An Alternative Approach was "tarted up" and introduced once again to Ministers at the time of the Industrial Relations Act 1971. Clearly it has been "tarted up" again, and now, at last! it has seen the light of day. I say that because essentially the argument of An Alternative Approach is the argument of the Green Paper. There is nothing new in this paper, there is nothing new in any of its proposals—except of course, Chapter 4, to which I shall come.

In fact the proposals in the Green Paper can be classified under two broad headings. First, there are those that we tried and with which we failed in 1971—and in 1980 the Government decided not to try again. Secondly, there are those that the Government tried in 1971, and which, in a slightly different form, they are trying again in the Employment Act 1980. Broadly speaking, that, with the exception of Chapter 4, is the substance of the Green Paper. Therefore, we are entitled to ask ourselves in this House this afternoon: Why at this point have the Government gone rummaging in the cellars of Tothill Street to produce this Green Paper? What are the possible reasons why the old cases were carried across from 8 St. James's Square into the depths of Tothill Street, now to find the light of day again? What possible reason can there be?

As your Lordships know, I am always a fair man. I try to look for good reasons if they can be found, and therefore I say that there are two possible reasons. First, if we look carefully at the Green Paper, we see that there are new, more plausible reasons, in the context of 1981, why we should favour these fly-blown old fossils. Secondly, it is possible that, like so much else at the moment, this situation has something to do with the internal politics of the Government. Like everything else that we read about in the daily newspapers, it has something to do with the "wets" and the "dries ". It is a matter of moisture. Let us see how moisture helps to explain the argument—

Several noble Lords: Oh!

Lord McCarthy

I am a fair man, even when I am being heckled, and so I shall begin by assuming that there is something in the arguments. Let us look first at those that were tried, and failed, in 1971. I have in mind, for example, proposals to extend liability for damages in court in the context of a trade dispute, proposals to encourage the legal enforcement of procedure agreements—that is what is meant, as the noble Lord, Lord Renton, rightly said—and all those restrictions on industrial action that are mixed up with notions about essential services, the public interest, and so on.

I suggest to your Lordships that if you read the Green Paper you will find nothing new in the arguments that are put forward in favour of these matters. Indeed, I would say that the arguments were better rehearsed in A Giant's Strength, A Fair Deal at Work, and An Alternative Approach. They are all very familiar arguments. The difference of emphasis is in the space given in the Green Paper to the arguments against. It is the inclusion of the arguments against, and the length and form of some of them, that constitutes not a new factor, but a change of emphasis so far as the Green Paper is concerned. For example, we are told, very fairly, that liability in tort could bankrupt trade unions; that it could encourage irresponsible trade union leadership. We are reminded of the cases that came up in analogous circumstances at the time of the Industrial Relations Act 1971. We are told, again, that one cannot turn trade union officials into policemen; that they do not have that kind of relationship with their members. We are told that if one does that, the results will be worse than the present situation. We are told that in the Green Paper. Those arguments are more sustained, they are in some ways even longer, than the arguments put forward on the other side.

Let us consider the question of legal enforceability. There is nothing new in the arguments that are put forward in favour of legal enforceability, but in the Green Paper it is admitted that of course there is nothing to stop employers having legally enforceable collective agreements now. There never was. If the parties wish to sign legally enforceable collective agreements, they can do so today. We are told in the Green Paper that most of the existing collective agreements would be void for uncertainty, anyway.

There are only two points that I should like to make about the case against legal enforceability, which I do not think the Green Paper has quite grasped. First, the legal enforceability of collective agreements in other systems of industrial relations—the noble Lord, Lord Renton, mentioned other systems which have legally enforceable contracts—is very closely linked to the fact that in most other systems substantive agree- ments are for fixed terms, whereas we negotiate open-ended agreements. Because in other systems fixed terms are negotiated, there has been introduced, and understood, the distinction between a dispute of right and a dispute of interest.

If there is a tradition of both fixed-term agreements and a distinction between disputes of right and disputes of interest, then it is natural and reasonable to have legally enforceable collective agreements. But since we do not have that system, and since there are no indications that employers want that system, and neither do trade unions, then talk about legal enforceability has nothing to do with the case. Secondly, in regard to legal enforceability—

Lord Hankey

My Lords, will the noble Lord give way for a moment?

Lord McCarthy

Yes.

Lord Hankey

My Lords, the noble Lord has made a very interesting point. In view of the fact that our law provides immunity for anyone breaching an agreement, provided that it is done in contemplation or in furtherance of a trade dispute, surely there is not very much reason for anybody to want to make effective enforceable agreements. There was an arrangement in the 1971 Act, but it was not tried very much. Does not that situation explain why employers have hesitated?—and we know that the trade unions did not want such agreements, anyway.

Lord McCarthy

No, my Lords, I do not think so, because we are talking about procedure agreements. There is no reason why an employer and a trade union should not sign a legally enforceable procedure agreement, which would be enforceable on the trade union for breach of contract. The fact is that they do not do that because we do not have that system, and that derives from our absence of fixed-term agreements and our recognition of a distinction between disputes of right and disputes of interest.

The other point that I would make about legally enforceable collective agreements is that one does not encourage people in this country, as we wish and as we should, to enter into more precise and binding contracts—which I take it is what we all want to do in collective bargaining—by proposing additional sanctions for those who break those agreements. That is one pragmatic reason why most employers are not interested in trying to create with trade unions legally enforceable procedural obligations.

One could take the example about limitations on public interest strikes. Once again the best arguments, the best short, simple account—one that I shall recommend to my students—about the consequences of the ballot in regard to the railway unions under the 1971 Act is contained in the Green Paper. It is very forceful and very persuasive. I find it much more persuasive than the somewhat unpersuasive arguments in favour of an extension of the ballots.

To sum up these parts of the Green Paper—that is to say, Chapter 3, Sections A, D, E and H—I would say that there is no new, compelling argument to suggest in regard to the areas which we tried in 1971 that the record would be different from what it then was, and that the arguments of experience that are set forth in the Green Paper all make the case against the proposals quite convincing.

Let me turn to those parts of Chapter 3—that is to say, Sections B, C, F and G, dealing with secondary action, picketing, other forms of secret ballot provisions, and the closed shop—relating to areas where, despite the experience of the 1971 Act, there are in the 1980 Act provisions to try again. Here the proposals in the Green Paper seek to take us considerably further than we have been taken by the 1980 Act. They suggest the total ban on secondary action; they suggest police enforcement of off-site picketing; they suggest the illegality of all forms of closed shop. This afternoon I have time to deal only very briefly with two of those proposals, and I turn first to the one which, I must say, scares me by far the most. That is what term police enforcement of off-site picketing, by instructing the police to take the names of those who they believe might be committing unlawful picketing.

I would make three points here, with all the seriousness that I can muster. The first point is that this is not what the police themselves want. This is not what the police evidence suggests or supports, for example in the evidence of the chief constables to the Select Committee on Employment in another place. Indeed, we all know that it is not what was informally represented to the Government by the officials of the police and the Police Federation at the time of the 1980 Act. It is not what the police of this country want.

Secondly, as the Green Paper rightly says, if we move down this path we shall be creating "no-go" areas in the context of an industrial dispute. Thirdly, again as the Green Paper rightly says (and the reasons in the Green Paper cannot be improved upon) there is no parallel in this situation, as sometimes is suggested, with the position of squatters—no parallel whatsoever. This could be the single, most divisive proposal put forward by a divisive Government. This could destroy the traditional neutrality of the civil power in the context of an industrial dispute, and I sincerely warn the Government against any movement in this direction. Quite frankly, I do not think they are daft enough to do it, and I thank God for it!

So let me move to the closed shop proposals. Of course, here we have a plethora—the total illegality of UMAs, the perpetual review of UMAs, "unrealistic operation" compensation, and so on. I would make three points briefly. First, all the arguments about the attempt to outlaw the closed shop in 1971, the failure of that and the way in which the more illiberal aspects of the closed shop flourished between 1972 and 1974 because of its illegality, apply with greater force to any proposals of this kind. Secondly, there is considerable action against the closed shop, again, in the 1980 Act; so surely there is an overwhelming argument, in this field above all, for waiting to see what happens.

Thirdly, here, most noticeably, we see one of the suppressed biases of the Green Paper; and since I have (to my own satisfaction, at least) destroyed the arguments in favour of it on the merits, it tends to make me move towards my second assumption as to what is behind it—that maybe we are coming close to an internal dialogue. Note throughout (particularly on the closed shop, but not only on the closed shop; on secondary action, too) the tendency to argue for restrictions on trade union power on moral, or what I would prefer to call pseudo-moral, grounds. Note how it is assumed throughout that no sane man, no fair-minded Englishman, could possibly defend secondary action. It must be wrong; no one could want to participate in an industrial dispute which affected an "essential industry"; it is not British. No one could agree that the closed shop could be justified. The closed shop is a form of sin. It comes along with adultery, sodomy, covetousness and UMAs—they are all the same! These things are immoral!

The only arguments against this are not counter-moral arguments. You do not hear arguments about borrowed strength, about trade union solidarity, about the common obligation or about trade union discipline, order and structural reform. None of these arguments do you hear. No—you hear pragmatic arguments. You are told, "We know it is wrong, we know it is immoral, we know it is like Sodom and Gomorrah; but, you see, ma'am, if you do anything about it you will make it worse ". So, similarly, you can search through this Green Paper but you will find no treatment of the very analogous practices in the professions, which I have mentioned many times in this House and do not intend to go into again. There is nothing about them in this Green Paper.

There is nothing about the positive case for the closed shop. This is presentational. It is as though someone in the Government is saying, "We know how some people in the Government feel about these things, and if we seek to defend them on their merits and say that they are justifiable, that will only annoy, that will only infuriate". It is much better to say, "We see your case; we know the morality of your position; but, you see, it just is not practical; it will just make matters worse ".

If that is the case, it helps me to explain, very quickly, what I make of the chapter on positive rights, because I think that this is presentational, too. The astonishing thing about the chapter on positive rights—paragraph 337, for example—is that it argues for the system of positive rights on the grounds of simplicity; that this new system might be more simple, and would generate trust and understanding on the trade union side. Of course, you have to go on and give rise to some doubt by talking about some of the actual complications—and very well is it done.

For example, we are told that this will be an entirely novel, fundamental departure in British law, for which there is no precedent. That is quite right. We are told that we could not be certain that if we had a system of positive rights tortious liability under the old common law system would disappear. It might re-emerge; it would all depend on how the judges felt that day. We are told that there is no intention to give workers the one advantage that a system of positive rights might produce; namely, protection of individual strikers against breach of contract, as exists, for example, in France, Italy and so on. That is not suggested. We are told that there will be a whole series of specific limitations on the general right to strike, rather like the limitations introduced in the 1980 Employment Act; for example, in relation to secondary action.

This is a series of totally untried provisions; an untried set of shoals which the trade unions will some- how have to negotiate according to how they are defined by the judges. This is progressive window-dressing, and the Government know it. This is there, not because they mean to do it. It is a monster, and they know it is a monster—and it will take five years to get this monster to the starting gate. This is there so that someone can say, "But, you see, Lord McCarthy, the Green Paper is not totally anti-trade union. What about chapter 4? Would that not be a good thing? "This is presentational. They do not mean it, and their own words signify that they do not mean it.

I therefore conclude by saying that it is very appropriate that we should be discussing this foolish paper on All Fools' Day. It is significant that a powerful group within the Government have not yet learned the futility of a legal attack on trade unions. They believe that you can break trade union power by law. I do not say that the Secretary of State for Employment believes that. He is much too intelligent. The trouble is that he has not yet gained full support for his step-by-step approach, which really means "no more until after the next election". And why no more until after the next election? It is because the Secretary of State knows very well that if this economy gets off its knees he will need the co-operation of the trade union movement.

I like to think that he realises, and I like to think that the noble Earl, Lord Gowrie, realises, that the central problem of industrial action in this economy at this moment is not to do with the state of the law. The central problem occurs in the public sector. The strikes that concern us in this economy at the moment overwhelmingly occur in the public sector, and they occur because the Government, in the interests of their economic policies—and previous Governments; I do not want the previous Labour Government to escape—have destroyed or qualified or set aside traditional systems of pay determination in the public sector.

My Lords, that is the problem. It is no use to make laws about it. The strikes which the miners undertook in 1972 were all against the law and they were against the law in 1974. If the miners had gone on strike earlier this year it would all have been against the law because they would have won by secondary picketing. This Government did not even wait to see; they sued for peace. So much for the 1980 Employment Act. They are right. What these Acts do is to create dissent, they limit the powers of small groups of workers who are struggling to get some strength; they do nothing against the trade union "bully boys". They are presentational. For all those reasons, I ask the House not to support any legislation based on this Green Paper.

3.51 p.m.

Lord Rochester

My Lords, from these Benches I should like to join in thanking the noble Lord, Lord Renton, for having introduced this debate and for giving us the opportunity to participate in the consultative process now very properly going on on the Government's Green Paper. It enables us to discuss the whole complex problem of whether—and, if so, what—further changes should be made now in the use of law in resolving industrial disputes in this country. In our debates on this subject last year, I expressed the hope that once certain identified abuses had been remedied by the Employment Act there would be no need for further legislation at least until there had been a period for digestion in which the provisions of the Act could be given a chance to work. That was said partly because if our industrial relations law is to be effective it must command the widest possible support, including particularly that of the general body of trade unionists. I very much doubt whether the enactment of further legislation at this juncture would have that support. It was also said because I do not believe that more legislation of this kind will itself do anything positively to improve human relations in British industry, and because, in the last resort, this question has primarily to do with people.

It would be much easier for me as a Liberal to advocate, for example, the immediate abolition of the closed shop. But in this matter I cannot be untrue to my industrial knowledge and experience. As the noble Lord, Lord McCarthy, reminded us, the attempt in 1971 to outlaw the closed shop did not work. It went underground and I fear that, if the matter were again put to the test, the same thing would happen with effects, which, because they would be concealed, might produce even more illiberal and arbitrary practices than now obtain. I adhere to my hope that there will be no need for further legislation in this field, but I recognise that the fulfilment of that hope will depend on the response made to last year's legislation. It may not suffice, for example, for employers and trade unions to keep just within the letter of the law. That was evidenced the other day by the strength of feeling (which I joined in expressing) in this House against the Sandford Borough Council and the National Association of Local Government Officers. There must be conformity also with the spirit of the law and no further abuse of the powers that there still are when closed shops are introduced to dismiss long-serving employees unfairly; and there needs to be an end to the practice whereby certain local authorities are persisting in bringing pressures to bear on outside contractors to introduce closed shops by excluding from approved lists of tenderers those contractors who do not operate a closed shop. A heavy responsibility, I suggest, rests on the trade unions in that regard.

I hope that, in the light of what I have said so far, your Lordships and particularly the noble Lord, Lord Renton, will understand why I shall not be delving into the intricacies of the law concerning immunities relating to picketing and secondary action. I am not a lawyer and, in a sense, it would be impertinent for me to do so, anyway. But I have explained that there are other reasons why I shall not be doing that. Instead, as my contribution to the debate, I should like deliberately to pick out a few parts of the Green Paper dealing with areas in which I believe there are positive steps that we can take together to improve industrial relations in this country on a voluntary basis.

First, I note in paragraph 4 of the Introduction to this paper a part which was not quoted by the noble Lord, Lord Renton: Many strikes effectively repudiate agreements made by those organising them or by their representatives and the vast majority are called without reference to senior trade union officials and without their endorsement ". On page 5, in paragraph 15, it is rightly said: A shift of power has been taking place in the trade union movement; from the centre to the shopfloor, from full-time officials of the unions to shop stewards drawn from those among whom they work. It is reflected in the tendency for plenary power to call industrial action, negotiate and settle to be seized by the shopfloor or delegated to it". Later in the same paragraph: The development of this informal system of management/trade union relationships alongside the formal system was clearly identified by the Donovan Commission. Its effect in the years since 1968 has been to weaken the authority of many large trade unions and to make the task of their leaders and of the TUC more difficult. It has been associated with an increase in unofficial industrial action to the extent that some 90 per cent. of strikes are now unofficial". Given that situation, the strongest case for altering the law seems to me to reside in the removal of immunities from industrial action taken in breach of collective agreements. However, it is plain from Section E of Chapter 3 of the Green Paper that this question is inextricably bound up with the further problem of whether it is feasible to make collective agreements legally enforceable contracts. For the reasons given in Section E, I fear that there is a great deal of education needed before negotiatiors are sufficiently convinced of the desirability of such arrangements for them to become workable. I should like to ask the Minister whether, as a first step, the Government would consider in their consultation the possibility of introducing a further code of practice additional to those on picketing and on the closed shop. That would deal with negotiating procedures. Among other things, it could draw attention to the point already made by the noble Lord, Lord McCarthy, that in Western Europe a clear distinction is drawn between disputes of right involving the terms or interpretation of agreements already entered into and disputes of interest.

In disputes of right, there is an obligation not to resort to industrial action before referring the issue to a court of law or to arbitration; and almost invariably the parties to the dispute abide by that independent decision. Disputes of interest, on the other hand, arise out of bargaining situations and, typically, when an existing agreement affecting pay expires and a new one must be negotiated, both parties retain their freedom until a new agreement is reached. If the parties cannot agree on the terms of a new agreement a dispute of interest appears and both are free to use industrial action if they wish: the union side to call a strike and the employers equally to operate a lockout. However, even in disputes of interest, although industrial acton is considered entirely legitimate, great efforts are always made to avoid it.

The code of practice that I have in mind would be based on the proposition that conditions should be established throughout British industry that would enable negotiating procedures to be introduced in which both management and employees had sufficient confidence to see that they should be observed. Under these procedures, the aim would be to work towards a situation in which in all disputes concerning the terms or interpretation of agreements already entered into, and whether they affect individuals or groups, there should in the last resort be recourse to arbitration which both management and employees would abide by.

Depending on the progress made towards such an objective, perhaps the provisions of such a code—like others stemming from the Employment Act—might eventually become admissible in evidence and be taken into account in proceedings before a court, an industrial tribunal or the central arbitration committee. In this way we might gradually, and with a sufficient degree of consent, reach a position where the organisers of industrial action that is taken in breach of collective agreements would no longer have legal immunity and could be sued for damages. There are no doubt many political, legal and maybe other problems to be surmounted before anything like this could actually be achieved. I hope that the noble Earl, Lord Gowrie, when he comes to reply to the debate, will be kind enough to say whether he sees what it is that I am driving at, and if the Government have sympathy with the underlying principle at any rate of trying now in that way to extend the use of codes of practice.

The next point that I want to make concerns trade unions. I do not believe—and in this I am with the noble Lord, Lord McCarthy—that our industrial relations can be improved without their help. Here I subscribe fully to the proposition put forward in paragraph 16 of the Introduction to the Green Paper: that unless the trade union movement comes to more rational structures for the conduct of collective bargaining, it cannot best serve the interests of its members or contribute to improved economic performance and the benefits this would provide to the community as a whole". Again, in paragraph 20: If trade unions are to restore their authority and regain or sustain the confidence of their members they must be fully democratic both in the way they take critical decisions and in the method of electing their officials". In my view, there is another way, which so far as I know is not mentioned in the Green Paper, in which trade unions can help. I believe that there is an urgent need for management and employee representatives to share an understanding of the basic facts concerning how a particular business is run, the effects of alternative uses to which money can be put and their relationship between investment, prices, pay and employment in that business. I am convinced that this is best achieved through activities that are sponsored jointly by employers and trade unions. It is being done already in some companies with the co-operation of union representatives in particular localities.

However, it would make all the difference in my view if ventures of this kind could be positively encouraged by a lead that is given from the very top of the trade union movement. Here I have in mind particularly the training of shop stewards. Let the facts be examined on their merits by management and employee representatives together. If the arguments that are advanced by management do not stand up, conclusions drawn from them will not have the effect desired by management—and nor will they deserve to. I am not here seeking to undermine formal negotiations between accredited representatives of employers and trade unions; rather, I am advocating the need for a common understanding of business realities which will influence those negotiations and, more particularly, the settlements that arise out of them.

All this naturally leads to the question of what else employers can do to help. In paragraph 24 of the Green Paper it is stated: …employers have shown too little willingness to involve employees and their representatives in policies and decisions which affect their working lives. As a result employees, particularly in large companies, feel remote from the centre of decision-making in their firm and powerless to influence the running of their enterprise". In the next paragraph it says: The responsibility for initiating changes in this area clearly rests with managers. It is not simply a matter of developing new machinery for involving employees or increasing the flow of information about the company but a readiness to extend the range of matters on which they are prepared to consult and to take their employees into their confidence". Some employers are doing a great deal in this way. The company for which I used to work has developed a consultative system which starts in the factories and works upwards to division and company level culminating at the top in what they call a central business and investment committee. There are still far too many firms which lag behind. Personally, I share the view of the authors of the Green Paper—if I have understood it correctly—that employee involvement of this kind is best developed voluntarily and not imposed by legislation. I believe too that it should be a matter of an organic growth which starts at the bottom and works upwards rather than the other way round.

However, as the noble Lord, Lord Scanlon, reminded us in a recent debate on industrial training, the trouble about voluntarism is that there need to be volunteers. If sufficiently widespread progress is not made in this field, I fear that one day there will be imposed on employers from outside laws in forms which will be unacceptable to them. In that case, they will, in my view, have only themselves to blame.

The last specific point that I should like to make arises from Section of Chapter 3 in the Green Paper—that dealing with the problem of how the community as a whole can be protected against the potentially damaging effects of industrial action without restricting the freedoms of trade unions and individual workers to an unacceptable extent. Here I start from the premise that experience under both Conservative and Labour Governments in recent years has demonstrated that, except in the case of those employed in the armed services and the police force, it is not practicable to operate legal sanctions against the ultimate right of individuals or groups to withdraw their labour.

It is for that reason that I believe that there is a strong case for the pay of people employed in certain key occupations (it may be that here I am not very far from the noble Lord, Lord Renton), which may be difficult to define but which may be broadly seen as those which are vital to the support of life or to the security of the state, to be determined by a single arbitrating body whose members should include a significant proportion of people independent of employers and trade unions but acceptable to their representatives. The maintenance of such a body would have to be guaranteed by commitments entered into not only by the Government of the day but by the main Opposition party, and including an undertaking that in all circumstances and irrespective of incomes policies the findings of the body would be implemented.

An essential condition of such an agreement would be that the Government or other employer and the trade unions concerned would undertake in advance to accept the referee's decision. I hope that the Government will feel able to give their consideration to some such arrangement as this. In the last resort, the improvement of our industrial relations depends on changes not in the law but in attitudes. One day perhaps we shall learn, partly from education and training but, I fear, much more from painful experience, that, in the words of the very first sentence of the Green Paper, A nation's prosperity rests ultimately on the ability of its people to live and work in harmony with each other.".

4.11 p.m.

The Minister of State, Department of Employment (The Earl of Gowrie)

My Lords, I very much welcome this debate and I am most grateful to my noble friend Lord Renton for giving us this chance to debate the Green Paper on trade union immunities. This is an excellent time to hold such a debate because we are now well into the consultative period, which is due to last until 30th June. And so today in this House we have an opportunity to take part in, and influence, the course of the debate. As I have often said, there is in this House a wealth of experience of industry, the trade unions and industrial relations. In sheer empirical day-to-day experience, I would say that we did rather better than another place in that regard. I am therefore looking forward to the rest of this debate, which up to now has been interesting and constructive and which I am sure will continue to be so.

If I may, I will make a few general remarks now and, if given leave, when I come to wind up will deal with detailed points which have been mentioned to me. I should like also to congratulate my noble friend on attracting a pretty heavyweight list of speakers; indeed, rather more trade union heavyweight speakers than usual. I very much welcome that. I notice, however, that no Social Democrat is down to speak: not a single chorister is here to sing! Of course, I acquit the noble Lord, Lord Harris of Greenwich, who introduced the closed shop debate last week.

I should like also to congratulate the noble Lord, Lord McCarthy, for detecting internal dissent in the Tory Party. Sitting on the Labour Benches at this moment in time he is rather like the famous seismologist who delivered an earthquake warning in Honolulu on the morning of Pearl Harbour and, as your Lordships will recall, this being the first of April, he thought it was an appropriate day for the introduction of this Green Paper. I would remind the noble Lord that it is now well after 12 o'clock, so it does not count after that!

This debate is not, of course, just about the law and it is not just a matter of deciding whether to adjust the boundaries of legal immunity here and there. Of course, law is important and the Green Paper rightly discusses a large number of suggestions for detailed changes in the present system of immunities. But as the introductory chapter makes very clear, these ideas have to be set in the wider context of our industrial and economic problems. If the Green Paper were concerned only with fine-tuning the law, I do not believe we would be debating it with such urgency. It is concerned with something much wider than that—with nothing less than trying to find a way out of the sterility of industrial conflict and confrontation and getting away from the obstructive attitudes and the resistance to change which have bedevilled our industrial relations for so long in this country under successive Administrations. I must say to the noble Lord, Lord McCarthy, that in 25 minutes of the sort of dazzling performance we have come to expect of him, there was not one moment of constructive suggestion, not one criticism of existing practices and not one indication that we might go forward in any different way whatsoever.

My Lords, I think trade unionism is a subject encased in demonology and what the late George Orwell called "double think". On the one hand, unions are seen as "over-mighty subjects", accountable to no one but themselves, pursuing purely sectional policies with ruthless single-mindedness and obstructing all change and reform, prepared sometimes even to try to bring Governments down if they get in their way. On the other hand, they are sometimes seen as essentially weak and divided, uncertain of purpose, their internal authority in decay, being unable to honour agreements which are signed in their name, and the prisoners of activists or militants at shop floor level. I think both pictures are over-simplified and overdrawn, but there are some elements of truth in them.

If we take away the demonology and "double think" I believe that two conclusions are sensible and inescapable. The first is that the trade unions and our system of industrial relations are the products of over 100 years of history in which the regulative role of the law in this country has been minimal. The second inescapable conclusion is that no one can be altogether satisfied with that result.

Perhaps I may give your Lordships some quick examples of what I mean. For most of this century the law has abstained from any serious attempt to regulate collective bargaining arrangements, and nothing so clearly distinguishes our system from that of most other countries. Yet in spite of this, and in spite of what one would expect as a result of most of this century's experience, this history has not noticeably lessened the trade unions' suspicion and mistrust of the courts. On the contrary, they are perennially suspicious of the law and resentful of any restraint it imposes on their ability to organise industrial action, or of anything which smacks of interference in their internal affairs. In fact statute law has never been able to provide the unlimited immunity which the trade unions desire. Even the 1974 and 1976 Acts—which, as I am sure the noble Lord, Lord McCarthy, would agree, were designed to keep the courts out of industrial relations—failed notably to do so, and many of us would think that in some instances it was a good thing that they did.

To take another example, the absence of legal regulation can be seen clearly in the diversity of trade union organisation and structure if we compare them particularly with trade unions in, for example, West Germany. Trade unions in this country have developed in an ad hoc fashion according to the needs and the circumstances of the people they represent and of the industries in which they operate. They conform to no tidy occupational or industrial patterns, and some of them are little more than very loose federations of independent organisations. Therefore they do not always conform to the easy stereotypes that are por- trayed in correspondence columns of newspapers, and indeed in some editorials. Rather rarely do they fit their image as strong, monolithic bodies, single-minded in the pursuit of their policies and exercising a tight control over their officials and members. In practice we find more often than not that they are the opposite: divided and uncertain of purpose, with constant tension between the full-time officials at the centre and the members and lay representatives at shop floor level. Indeed in some industries the very phrase "trade union power" conceals more than it reveals: the reality is shop floor power exercised without reference to formally-constituted trade union authority, and sometimes even in defiance of that authority.

Then I think there is another historical curiosity, which again is sharply relevant today. This is—and I make no apology for straying into politics here—the constitutional relationship between the trade union movement and the Labour Party. Looked at from their own point of view, not from the Conservative point of view, can noble Lords opposite really put their hand on their heart and say that this is still a mutually beneficial relationship? The failure of Mrs. Barbara Castle's brave attempt in In Place of Strife; soaring wage inflation and the almost infinite stretching of immunities when Mr. Foot was at Employment; the disastrous winter of 1978–79 when Banquo, so to say, in the form of Mrs. Castle took revenge on Mr. Callaghan's Macbeth; Wembley in January of this year all these recent episodes are not scenes in the life of a very happy marriage. And, indeed, some would argue that last Thursday the divorce was sealed and appears to be final.

And can the TUC, can any organisation representing over 12 million people, put its hand on its heart and say that this is any more satisfactory from a union's point of view? The political affiliation is an absurdity as, without the support and votes of millions of individual trades unionists, there never would be such a thing as a Conservative Government. Indeed, my noble friend reminded us that it was the trade unionists in his constituency who helped to elect him no less than 10 times.

These are historical and political phenomena. But it is when we consider the economic consequences of the operation of our industrial relations system, that its deficiencies are most immediately apparent and most worrying. In the debate on 11th March, I referred to the decline in the competitiveness of our labour-intensive manufactured goods. I said that I believed the main factor in our declining competitiveness had been our input costs. There is evidence that in this country our input costs are a great deal higher than elsewhere. One breakdown of the figures illustrating our loss of competitiveness suggests that 60 per cent. of the fall since 1978—and that fall is about 50 per cent. in itself—and about half the fall since the beginning of 1979—and that fall is nearly 40 per cent. in itself—were due to labour costs rising faster in the United Kingdom than in our leading competitor countries.

I am not suggesting that the blame for our declining competitiveness can be laid entirely at the door of the trade unions. Managers do not have always to give in. Will Fleet Street please note? But there is no escaping the fact that, until recently, wages have consistently risen faster than prices, without any corresponding increases in productivity. The figures speak for themselves. Between 1975 and 1980, unit labour costs rose here by 85 per cent.; in France, the figure was 43 per cent.; in the United States, 33 per cent.; in Germany, 11 per cent. and in Japan they actually fell by 2 per cent. So I do not think that any serious person doubts the link between high unit labour costs and our inability to compete in world markets or to meet foreign competition in these, our domestic markets. And I do not think that any serious person can question the link between that uncompetitiveness and the loss of jobs.

It is simply not credible for the TUC to look the Government in the eye and complain about unemployment. There is a beam at least a million and a quarter strong in their own collective orb. Reconciliation does have to be made between individual unions' legitimate desire to protect the living standards of their members, and their, I am sure, equally sincere desire not to impose overall levels of unemployment. So what I am saying in the context of this debate is that it is an illusion to think that we can legislate ourselves into prosperity and full employment.

If curing unemployment were simply a matter of changing Government policies, or even just changing Governments, life would be a lot simpler for us all. But the truth is that successive Governments over the past 20 years have tried to support industry, stimulate investment and create jobs; yet the underlying trend in unemployment has been upwards. In our view, the only real answer to these problems is to bring down inflation and contain public spending in order to release resources for industry, so that industry will have both the confidence to invest and the certainty that when it does invest it will not be continuously crippled by high rates of interest. And high Government borrowing squeezes the capacity of industry to borrow and to invest.

Our policies are, therefore, very close to Mr. Healey's in 1976 and 1977, and we are determined to resist the temptations to which Mr. Healey fell victim in 1978–79. But politics apart it is, of course, only by industry's own efforts that we can ensure that our goods are competitive and are of the quality which people demand. We believe that with the right policies we can, however, help to establish the climate in which enterprise and initiative will prosper.

There is plenty of evidence that the combined effect of world recession, competition from low-cost manufacturing industries abroad, the rise in sterling and the Government's monetary policies has been to achieve a real shake-out of labour; a real reduction in over-manning of the kind politicians of both parties have talked about as being necessary for decades. To attempt to insulate industry now from the painful process of adapting would mean further undermining our competitiveness. This we will not do.

The result of our determination is that inflation is coming down steadily now, much faster in Britain than in our competitor countries. In the six months to February, the RPI has risen only 4.2 per cent. The year-on-year rates have come down from 21 per cent. last July to 12½ per cent. in the 12 months to February this year. This is a dramatic change in only a few months. Alongside this, a sense of reality has crept into wage negotiations: the average increases in this particular pay round are now under 10 per cent. compared to some 21 per cent. in the last pay round—a pay round which we shared with the previous Labour Government. And strikes in industry are now at the lowest level since the war.

These are all developments which can, and should, give us satisfaction: they show that the means are there for management to bring about a change on the shop floor in British industry, which is long overdue and which had seemed to all of us impossible only a few years ago. There is no room for complacency, because it would not be difficult to throw away the gains made so far. But the changes now taking place should have a marked effect on productivity when the upturn comes. And that can only help our ability to match the frighteningly good international competition which we face.

The point of my mentioning this is that no change in the law could have brought about this greater realism in wage bargaining. No legal immunity, however wide, can prevent a militant trade unionist from trying to persuade someone to price himself out of a job. And no limitation of immunity can be as fierce a discipline on industrial action as the realisation that it will cost the striker his job. In a free society, the only sensible thing to do is to face people with the consequences of their own actions and not seek to protect them from these consequences. Nine times out of ten, they will act reasonably and responsibly if this is done. So we do not want to raise expectations in this Green Paper which no amount of legislation will be able to fulfil.

Our industrial relations are rooted in, and permeated by, voluntary arrangements. We may regret that. We may feel that many of the weaknesses of our industrial relations have developed exactly because the law has played so small a part in collective bargaining. But the results of the abstention of the law from these aspects of our industrial relations is something we cannot ignore. We have to work with the grain of our culture and our history and not against it.

There is, I believe, no clearer reflection of this than the fact that, unlike most Western industrial countries, collective agreements here have never been enforceable in law. Indeed, such is the resistance to legal enforceability among both employers and unions, that when in the 1971 Act all agreements were presumed to be legally enforceable unless they specified the contrary, all negotiators, without exception, opted out. What began as an attempt by the Government to encourage the spread of legally enforceable agreements ended by stiffening resistance to such agreements. And, as I said in our debate last week on the closed shop, the whole difficulty of outlawing that lawful institution (as distinct from protecting individuals from its effect, which we have done) is that you need the co-operation of employers. And employers in substantial parts of industry have told us in terms that they will withhold such co-operation. That drives the practice underground and makes it impossible to offer to the individual the protection, and the compensation, that the Employment Act allows him.

Another significant issue is that our experience in the light of the 1971 Act is that courts would have great difficulty in determining when unions were and were not responsible for the actions of their members and officials. That is because of the chaotic nature of many trade union rule books and the uncertainty about how they delegate authority to organise industrial action. As the Green Paper points out, any legislation would need to give clear and detailed guidance on this if it were not to risk running into the same difficulty as the 1971 Act. If the law is to work effectively, it is essential that both employers and trade unions know where they stand.

I am not saying that we should give up and go home, that legislation in these areas is bound to fail, or that it would be wrong to attempt it in any circumstances. Far from it. Indeed, as your Lordships know, in the Employment Act we have already taken steps to correct abuses of trade union power on the picket line and in the closed shop, to encourage the use of secret ballots and to lighten the burden of employment protection legislation on employers, particularly small businesses. These were all clearly identified abuses and the action we have taken commands the widest possible support.

I would say again to the noble Lord, Lord McCarthy, that this legislation does not seem to be at all complicated and that we have not ruled out additional steps by legislation. In fact, if we could find sensible legislation or additional legislation that was agreed and needful and that would stick, we should certainly bring it in as soon as ever necessary.

What I am saying at this moment is this: new laws will fail if they do not take account, as the Employment Act takes account, of the realities of British industrial relations. If we ignore the practices and institutions on which the law is intended to operate and if we deceive ourselves about their true nature, then that is a recipe for legislation which will not work and will not be able to be enforced.

I make no apology for repeating that the failings of our industrial relations system have weakened our industry, our economy and our nation for years. What we are suffering today in terms of loss of competitiveness and markets and loss of jobs is in some measure the outcome. But I have to confess that I personally am sceptical as to how far one can cure industrial relations difficulties by legislative action.

In the dark days of the last war, that great English public servant, William Beveridge, looked forward to how, in the coming peace, our country and our industry could achieve and sustain full employment for its people while striving to mature as the model of a "free" society.

Beveridge foresaw then some potential conflicts between the freedoms and traditions of our people when they take part in union activities and the activities and maintenance of full employment. He foresaw then that conditions of full employment could lead to sectional wage bargaining, with excessive wage demands leading to price rises and further excessive demands as the different groups of workers tried to catch up with inflation and with each other. He recognised then that if irresponsible sectional bargaining went on like that, it would bestow no lasting benefits on the workers, would mean expropriation for pensioners and others on small, fixed incomes and would ultimately endanger the very policy of full employment whose maintenance is of interest to everybody. The present levels of unemployment and the quite uncompetitive unit labour costs that we still have in this country sadly point to Lord Beveridge's fears having been justified.

But as we seek to correct the ills of the British economy and to banish his fears, let us not fall into the trap of thinking that we can legislate ourselves into full employment or higher wages, any more than we can legislate for fine weather or human happiness. Human life need not be nasty, brutish or short; it does not have to be bloody, but there is no avoiding its component of toil, sweat and tears. A counter-inflation policy, which we see as the essential precondition for greater industrial competitiveness and more permanent jobs, always produces a lot of tears. I wish we could legislate our nasty inflation out of the system, but of course we cannot. The difference between ourselves and our critics, be they sturdy Labour caterpillars walking on their million block vote legs, or dazzling Social Democratic butterflies, is that they believe that we can borrow our way out of Britain's difficulties, whereas we do not.

I hope that this present Green Paper is a useful and informative document, part of the process of what military people call "putting you in the picture" in order that you understand better both strategy and tactics. But it is not more than that. Those who seek to find within its covers a secret weapon against unions, or a magic formula for economic success are likely to be equally disappointed. Economic success depends on self-discipline, effort, patience, luck and cunning. I sit on this side of the House because, as a Conservative, I believe that this always has been the case, and is always likely to be so.

Lord Orr-Ewing

My Lords, before my noble friend sits down, can he assure the House that, when all the representations concering this Green Paper have been received, the Government will put into the Queen's Speech a statement that they are prepared to legislate to put matters right should representations be made to that effect?

The Earl of Gowrie

My Lords, if the noble Lord is kind enough to read my speech tomorrow, he will see that I have answered that question.

Lord McCarthy

My Lords, before the noble Earl sits down, would he not agree that although I proposed in my speech no further legal changes—and I do not think that he did—in the final section of my speech I suggested that what is really needed is a more stable system of pay determination in the public sector? I am sure the noble Earl remembers the first occasion when he and I debated in this House. It was upon a motion advancing specific proposals, a motion which I put down in, I think, 1977. When he sums up, is the noble Earl going to refer to the need for a more stable system of pay determination?

The Earl of Gowrie

Yes, my Lords.

4.39 p.m.

Lord Allen of Fallowfield

My Lords, at the outset may I ask for the indulgence of the House? Due to a prior engagement I shall unfortunately be unable to hear many of the speakers who are to follow me.

After long, practical experience, right outside the realm of theory, of dealing with industrial relations, I am convinced that to seek to establish more legislation in a field where employers and trade union representatives are in the main charged with the responsibility of laying down the rules would be a mistaken course of action. Moreover, I take some comfort from the belief, after reading the Green Paper, that the Secretary of State for Employment and the draftsmen of the Green Paper are not themselves persuaded that legislation is the right antidote to the relations that exist in Britain today, and that therefore it is sensibly seen as not having a primary role in industrial relations in the immediate future. If there is any doubt about that, I would draw your Lordships' attention to paragraph 19 of the Green Paper, which says this: But good industrial relations cannot simply be legislated into existence. Reform must also come from within; from trade unions and employers adapting their institutions and practices to the social and economic pressures for change". I concur entirely with that sentence.

I feel it necessary to make that point now in the event that I may be misunderstood in what I have to say later. No one will deny, in this House or elsewhere, that the nation is facing immense problems—problems of inflation, problems of technology, problems of escalating unemployment—which at any time, particularly now, is wrong economically, wrong socially, wrong morally and wrong ethically.

Indeed, in my view in the United Kingdom today we are facing problems about the whole of our society and how it operates. I do not pretend that there are easy answers to the problems we are discussing today, and I challenge those who say that there are. As we all know, previous Governments have found that out to their cost and that view is based on 17 long years of experience as a national trade union leader, experience of 16 years or so (as others have had) of membership of the National Economic Development Council, and so one takes a very long, close look at what is written in the Green Paper and examines its relevance to the issues confronting us today.

One thing is abundantly clear to me, and that is that there is no answer in confrontation between Government and the trade union movement. Solutions to our problems have to be found in agreement, but of course agreement will only be possible if we all recognise that we are all part of a community of interest; that our role is not to challenge each other's existence. A nation with a long industrial and time-honoured trade union tradition, such as Britain, in my view can only operate successfully if there is a general consensus in our society. It is a matter of great regret to me personally that none exists at present in the industrial relations field. Instead, I do not believe that it is overstating the position to say that, as of now, we have a dialogue of the deaf. We have had a dialogue of the deaf for the last two years, and I hope that there will soon be a change of direction in that matter. We have also had damaging dissension and I see nothing immediately ahead of me which will be the corrective to that. I am convinced that a suitable corrective will not be found in enforcing legalistic measures on the whole pattern of industrial relations in this country, much as parts of the industrial relations scene are in need of reform.

It is against that background that I am firmly of the opinion that the Government should move with great caution and persuasion, seeking to get what they believe is necessary by agreement and by consent. I remain convinced that this is the direction in which we have to go if we are to get some sense and some common purpose into our industrial relations. I do not believe, whatever may happen as the months and years go by and things develop, that legal penalties have any place at all in employer-employee involvement. I remain convinced that they will not work. The history of industrial relations within the last two decades is, as we all know, littered with casualties of those who believed otherwise. Our nature itself makes it impossible for me to envisage changes of the kind which are touched upon in the Green Paper as a constructive and lasting change, or a constructive contribution to industrial redevelopment and new technology and—what is highly important—the fundamental need now to increase productivity of both capital and labour. I am in no doubt that nothing that is written in the Green Paper gives me any cause to change my view that, in so far as the Government seek to rely at any time on legal sanctions, they will find that they will come to a dead end with their policy.

In passing, may I say that I was pleased to read in the national press on Monday morning last that Mr. Prior, the Secretary of State for Employment, had succeeded in his step-by-step approach at a conference he was attending, to push back the ill informed and misguided opinion in his own party, who want to deal with industrial relations in Britain in the same destructive manner as the bull in the china shop. If we are to have a wide and informed public debate—and these are the words used in the Green Paper—for my part, the starting point of any analysis by employers and trade unions of the Government's views, and therefore of any examination of the ways in which the paper on trade union immunities might assist in bringing about some orderly reform of collective bargaining, must be the fact that the trade union movement is an integral part of democracy and can only function on the basis of co-operation and consent.

Those who live in the practical world of industrial relations have never found compulsion to be synonymous with co-operation. I think we are seeing some lessons on that in Poland at the present time. No state, however benevolent, no outside agency, nor even the judiciary, can, by legally enforceable procedures, effectively determine the function of management-workpeople relations, or determine how their joint interests can best be safeguarded and in the process, hopefully, safeguard the best interests of the community at large. Over the years numerous panaceas have been proposed by Governments. Some were unwisely applied in an attempt to correct what are said to have been the glaring deficiencies of the then current pattern of collective bargaining. Some of them, I regret to say, unilaterally imposed by Government, forced some unions at that time—and I regret to say that I believe it will happen again if the course taken is the same as in the past—with the support of others, into uncompromising hostility and near mass disobedience.

I know it is a point of controversy whether our collective bargaining institutions are in need of reform, particularly the possible reform itemised in the Green Paper. The common theme of the criticism is that much of the trouble is due to the power of the trade unions or abuses created by their power. Of course, it is rarely expressed as bluntly as that. Some years ago the Conservative Party itself published a statement which was given the title, A Fair Deal at Work, and I quote a sentence from it: Huge organisations are involved, wielding immense power over individuals and the economic and social life of the nation. Government has both the right and the duty to ensure that these bodies operate in the public interest". If I had not told your Lordships where that came from you might have thought it was a piece of socialist propaganda or another illustration of the Government being on our back. But, in the context of industrial relations, and given what we are told is the manifest weakness of some employers' associations, it is only another way of saying that the trade unions are too powerful and that the Government should do much more to protect their members and society against them.

We are all familiar with the common phrases in which this charge is clothed: that trade unions hold up the consumer to ransom, they obstruct necessary and urgent changes in industrial organisation, they encourage, or at least tolerate, unofficial strikes, they engage too recklessly in threats of strike action which a majority of their members dislike. The general drift of this view, if I may say so, expressly or implicitly is that the power of the unions should be curbed, and some things we have heard today I think rather give one to understand that that view is shared by some people.

What is of course missing is any uniformity about the remedies—a deficiency, in my view, which is clearly acknowledged by the terms of the Green Paper itself. There are plenty of questions but few, if any, solutions. It is a fact of life, whether we like it or not—and I do not—that there are those in our midst who quite unashamedly want to weaken, if not to emasculate, the trade union movement, although they may not all say so in public. They believe that unions are an infliction which history forces us to bear. For me, it is revealing nothing to say that those who adopt this kind of analysis of the defects of collective bargaining do so in order to state a case for its legal reform. They want the law to regulate both the activities and the domestic affairs of trade unions to a greater extent than at present. And I am inclined to the view that the Green Paper in some parts is also asking us to consider whether a case for the reform of collective bargaining can be based on this premise of excessive trade union power.

Let me say straight away, whether the Government believe this view or not, that I believe it to be wholly mistaken, and I submit three main grounds for rejecting it. Time does not permit a definitive examination in each case. Suffice it to say, first, it does not tally with the facts; secondly, it contains an inherent contradiction; and, thirdly, it rests on an inadequate and erroneous view, usually held by the theorist, of the nature of collective bargaining. It seems to me that one section of public opinion—and from time to time it is ventilated in this House—contradicts itself about union discipline. On the one hand, it clamours for strikers who break union law to be punished by fine or expulsion, but, on the other hand, it also objects, on grounds of individual rights, on the few occasions when members are disciplined for breaking other union rules—such as the conditions applicable to the closed shop, a little of which we have heard about today, or not supporting an official strike. To me this must be seen as having it both ways. The present critics of the unions, I believe, have to face the fact that they cannot have it both ways on arguments of this kind. If they want the unions to be strong, that is strong enough to maintain peace in their organisation and in their industries and trades, if they want them to control their members' behaviour, they should not complain about the consequences of alleged excessive union power or propose measures that would have the effect of weakening union power.

When these people talk about the strength of unions, I wonder whether they appreciate they are talking about two things which are rarely separated. The first is expressed in the strength of a union's membership sanctions, its power as an organisation over its members, its means of securing compliance with its decisions. The second, external, strength lies in the sanctions it can bring to bear on employers in negotiations, or on employers to observe agreements, or on employers who are guilty of malpractices. It is clear to me that these two systems of sanctions develop in conjunction. It is also clear to me that you cannot rob the unions of their external strength without weakening them internally as well. It may be that is what is intended, but to me this is the contradiction in the argument of those who want to curb union power.

Finally, I wish most sincerely to make this appeal to the Government. First, I hope they will not repeat the mistakes of the past, and, before deciding how they are going to handle the view expressed in response to the Green Paper, will listen to the views of the national centre of the trade union movement—although I understand from information I have recieved in the last few days that they may be submitted a little later than the Government themselves would wish. But, more than that, I hope they will make the necessary provision, in consultation with the national centre of the movement, to have a meaningful and constructive dialogue with them.

I accept that managements and unions, more than ever before—and I have never in my life found it easy to apportion responsibility for our problems either to one side or to the other—have a responsibility to each other and to the community to remove the cause of what has been described as damaging disputes and the cause of dissension in industry and commerce and services. By the same token the Government have a responsibility, in my book, for the economic health of this nation, which, with poor industrial performance, nil growth and crippling and unacceptably high unemployment, ought to be accepted by them as number one priority for solution and the cause of greater concern than the matters which are being discussed today in this Green Paper.

Regretfully, we are compelled, so it would seem, to operate in an environment where there is a total absence of any common unifying purpose between Government and the trade union movement, and precious little between Government and the central representatives of the employers in Britain today. All this, in my view, adds up to a nation wasting its substance in bitter social and political strife. What is desperately needed today is a new and bold concept to deal with new and challenging problems. That will not be forged by legalised approaches to the problems which we see confronting us today.

5 p.m.

Lord Hankey

My Lords, I always listen with the utmost interest and with deep respect to the remarks of the noble Earl, Lord Gowrie, for whom I have a great admiration, and also to the noble Lord, Lord Allen of Fallowfield, with his enormous experience in the field of industrial relations. But I must say that I am shocked by the tremendous complacency which is beginning to develop in this debate. It is really shocking that we should accept the present position either as regards the so-called progress of our industry under the Government's economic policy—with very much of which I agree—or the admirable state of our trade unions as described by the noble Lord, Lord Allen of Fallowfield.

Let me begin by saying that, although I have frequently criticised trade unions, I never criticise them for being too strong. I want the trade unions to be stronger. They are in a quite degenerate state in my opinion because they cannot control their members; they cannot carry out the agreements which they make, and collective bargaining which is not carried out is collective swindling. That is a state of affairs which makes it impossible for British industry to make the progress to which the genius of our working people and the skill of our engineers and technicians ought to be entitled. On all those fronts Britain is in a very high state, but in performance it is lamentable. If one looks at the OECD statistics—which I do because I used to be our delegate there—one sees that the United Kingdom still seems to be going downhill. There is no sign that the downward trend in our industry is ceasing. While other people's trends may be slightly downhill or some very slightly turning up, ours does not reflect any credit on the progress of our industry.

Do not make any mistake about it. The recovery of our industry, on which the success of the Government's economic and financial policies depends, definitely requires a much more fundamental reform of our system of industrial relations. I do not think that there is any doubt that we want to have stronger unions and better co-operation inside our industries. I have frequently spoken in favour of industrial councils such as those which Imperial Chemicals have, and other methods of co-operation such as the Germans have, because I think that it would make for a better relationship. But while the trade unions cannot control their own people, the directors hesitate to have them too strong in the board room, otherwise they would never be able to reach the fructifying decisions on which the progress of their industry depends.

It really is essential to face facts. It is no good saying that we are in a favourable situation. It seems to me that this Green Paper implies that we need to have a change, but it really is so hopelessly hedged around with pros and cons and to's and fro's that no one can say that it gives any definite lead. I used to have a colleague at OECD who was very influential there and an extremely ingenious man. It was always said of him that instead of having a solution to every problem—and God knows! we had plenty of problems—he had a problem for every solution. That is what I feel about this White Paper: as regards every suggestion which is put forward it carefully states the difficulties.

The Earl of Gowrie

My Lords, the noble Lord has, I am afraid, indulged in a Freudian slip by referring to the document a moment or so ago as a White Paper. It is, of course, a Green Paper. It is not the business of a Green Paper to come forward with proposals; it is a discussion document. A White Paper can frame proposals for legislation.

Lord Hankey

My Lords, I thank the noble Earl—he is always right. It was a slip of the tongue. I should like to take this opportunity of pointing to some of the conclusions which I think have to be drawn from reading this paper and from the present situation. First, there is the big question: should we revise our system of immunities for trade unions to break the law with impunity, and instead adopt the system which might be called the "Continental" system, of granting positive rights which both employers and trade unions would have to accept? One has only to look at the fascinating annexes to this Green Paper to see how obviously superior is the system of positive rights. No wonder our industries lose their place in world markets and are unable to compete or to attract new capital as they groan under the burden of our most complicated and inexcusably one-sided system of immunities.

I think that the Government really had a clear mandate from the electorate to make radical reforms when they came to power in the spring of 1979, but they have only made some small reforms, although I think very useful reforms, in the 1980 Employment Act. I personally was hoping very much that they would do something more extensive. Unfortunately, with a new general election only two or three years ahead, I agree with my noble friend Lord Renton that it would be difficult to carry out a reform like this in time. The noble Lord, Lord McCarthy, said—and I think with some justice—that it would be a five-year job. One cannot do a five-year job with a general election only two or three years ahead. So, reluctantly, I accept that we have to think about what other measures can be taken. I think that that is the path of wisdom and of practical politics.

Please believe me: whether we have a reform leading to positive rights or some lesser series of measures, I think that we really must now face the necessity of making collective agreements enforceable. I do not agree with what has been said in this debate to the effect that we must not change the law or that we cannot affect industrial relations by the law. Of course there is a degree of truth in that. But if we had a law of marriage which said that anybody could do anything with or to anyone with total impunity, there would be a great many more unhappy marriages. That is what our law on industrial relations is now doing to our industries. It really should be cleared up. If we make a marriage law which lays down certain disciplines which have to be respected, we do not thereby make happy marriages. Far from it. Nor will we make happy industrial relations that way—and this really is a fundamental truth—but we shall abolish a fertile cause of bad industrial relations.

If we have a system which gives the advantage to all the crackpots, the militants and the groups with even reasonable complaints to disorganise whole industries at a time, then, of course, we cannot expect to have a very favourable industrial performance or to attract a lot of capital into new developments and new technologies. Therefore, I think that we must face the necessity of some amendment to the law, and the one which I personally would favour very strongly would be that industrial agreements should be made enforceable.

There may be relatively few strikes now, serious as they are, but I think that the level of strikes will infallibly rise as soon as the recession diminishes and industry tries to recover. That is what has always happened before. It is sheer complacency not to foresee that that will happen again. I see that the noble Earl, Lord Gowrie, disagrees; I am very sorry, but I must put this point to your Lordships. The reason that we do not have so many strikes now is that our most unfortunate working people, with this enormous burden of unemployment on them, are afraid of losing their jobs. That is very sensible. They are quite right; they must be careful. But once industry starts going again—for this recession will pass, and there are some signs that it may begin to pass in the second half of this year—the discouragement of the fear of unemployment will disappear as unemployment starts to wilt.

Therefore, we must face the necessity of making a better system in the future. All my life we have suffered from our system of industrial relations.

The Earl of Gowrie

My Lords, I am most grateful to the noble Lord for giving way and I apologise for interrupting. While the point is fresh in our minds, does he seriously think that even with the end of the recession industry will be remanning on the scale on which it used to?

Lord Hankey

My Lords, no, I do not think it will; but I hope and believe that profits will start to rise. When the workers see that happen they will begin to feel a not unreasonable resentment that their wages have not increased as much as they might have done in the last two years, and they will start to press very strongly and then we are bound to have more strikes. Nothing else can happen. I am sorry to be discouraging, but I see the force of all this.

The Green Paper says, as also did the Donovan Commission, that British industry has shown little sign of wanting enforceable agreements. I agree with that. But in spite of what the noble Lord, Lord McCarthy, said when he very kindly allowed me to interrupt him, I do not think that a great many employers would want to make enforceable agreements when the law says that in an industrial dispute anyone can do anything with impunity. That just does not add up to me. There may be some snag about that; but that is what the common sense of the ordinary employer would say, and ordinary employers have an enormous amount of common sense. Therefore, that is not a very good argument for thinking that we ought to avoid enforceability. I am afraid that our legislators have been at fault over this. I am very sorry that the solution provided in the 1971 Act was not tried more persistently and at greater length. The trade unions certainly objected to it, and they carried their objection to the point where they prevented the system being tried out. We must find some other solution.

Does it not strike your Lordships as rather remarkable that the United Kingdom is unique among the countries mentioned in the very interesting annexes to this Green Paper, in having a very lax system of industrial relations? The United Kingdom is also unique in having done less well industrially than any of them. They have all made massive progress and we have not. We shall be in a very poor position indeed in 20 years' time if we do not pull up our socks.

Therefore, I think that we must try again and be far more persistent and less dilettante about this. People always say to me: "How will you make it enforceable?" I will tell your Lordships how the Americans make it enforceable. In their motor-car industry there are three great combines and they take it in turns to negotiate an agreement with the unions in the automotive industry, which is then accepted by all the companies. Each agreement is valid for three years. Of course, when the agreement has to be negotiated by company A there is usually a strike; the company is usually disorganised for a while, but the other companies go on. The result is that an American motor company knows that it will have no trouble for nine years; after nine years it will probably have big trouble, and it then shares the agreement with the other companies.

What disturbs industrialists in this country is that they never know what will happen. If you do not know what will happen, you cannot reasonably borrow capital—especially at the rates of interest that we have to pay in this country—and know that you will be able to invest it profitably and introduce new technology and machines. If you knew that you would be clear for nine years, that would be fine. The automotive agreements in the United States are indexed every few months to the retail price index. A slightly different system applies in the American docks. In the docks any strike against an agreement which is current is liable to be brought before the courts and the standard fine is 100,000 dollars a day against whichever side has broken the agreement: it might be the employers; it might be the trade unions. This makes them mighty careful. They do have strikes, but they are mighty careful.

All these countries in the annexe to the Green Paper have agreements which are enforceable in one form or another. If they can all do it and can all do it better than us, it is time that we revised our ideas, dropped our complacency and thought whether we should not do something similar in order to provide certainty for our employers. Incidentally, it would help the trade unions if agreements were enforceable. They would be much more careful about negotiating agreements. The agreements would be properly drafted instead of being an amorphous muddle of clauses. They would have a definite termination date. We could then have strikes which were legal after the termination date, whereas at present we must have a strike during the currency of an agreement because it does not have a termination date. This I think is bad for industry.

There is a great deal of material in this Green Paper and I very much agree with what the Green Paper says. I thought that the noble Lord, Lord Renton, made a most interesting summary and many very interesting suggestions, as did my noble friend Lord Rochester. But I want to deal with the problem of protecting the community, which is dealt with in paragraphs 306 to 338. I recall that strikes in the water, gas and electricity industries used to be illegal until the Government conceded a repeal of those provisions in the discussions of 1971. I remember that the Labour Party begged the Government in your Lordships' House to make just this one little concession. "After all ", they said, "such workers really never would go on strike and damage the community".

Since then we have had at least one very severe electricity strike. The water workers in Lancashire have allowed sewage to get into the drinking water in North Manchester. If any of us had done that, we would have gone to prison for it. Strikers have immobilised our hospitals and even removed the fuses from the doctors' working rooms at the Charing Cross Hospital. This sort of cancerous rot in our industries is now spreading to the Civil Service, as indeed it is bound to do if it is not corrected. The efforts of civil servants to hamstring the tax offices, and air traffic control and the airports at a time of major economic pressure, and the strikes last year by workers in defence establishments, including those for our Polaris submarines, are intolerable and inexcusable. Having been a civil servant myself for 38 years, I am deeply shocked. Will your Lordships please encourage the Government to realise that we must not be lax about public servants?

This part of the Green Paper is horribly sloppy—inexcusably so. The French, who are a very indisciplined crowd, seem to have the problem under control more or less, as you will see from Annexe C. We ought to take disciplinary measures when civil servants take action which is really irreconcilable with loyalty to the Government and to the community. For instance, I recall way back in the 1920s some quite important members of the Foreign Office losing some years of seniority for unaccepatble breaches of currency regulations, and offences against the diplomatic bag rules. This affected their pensions, and was a severe and effective punishment. I just leave the thought with the Government that there might be something in this. We must expect loyalty from public servants and insist on it in return for their security of tenure and indexed pensions. But, as we have recognised in the case of the police and the Army, may I add that public servants should also always be properly paid, especially if they are forbidden to strike.

Finally, I urge that it is going to be necessary for the Government to make it clear that they will shape the whole social security system to ensure that collective agreements are carried out. There has been a tendency in the past for people to go on strike and put a lot of other people out of work contrary to their agreements, and the social security system has come to everybody's rescue. I shall not go into details. I remember as well as you all do that the Government have made certain arrangements about this, and that a beginning has been made with it.

I believe that people who break industrial agreements should not enjoy facilities of receiving public money, and so on. This, I know, is a hard thing to say, but it is harder still when public services essential to the community are being broken up. I do not see why the protection of the law against unfair dismissal should not be withdrawn in the case of agitators and moles who repeatedly organise disruption in breach of agreements. Of course the industrial tribunals have to be brought in and more widely used, and I think immunity should be withdrawn from strikes against their findings.

Every effort ought to be made by all departments of government to back up the proper execution of collective agreements by both sides of industry, and the procedure agreements that go with them, right up to the date of the agreements' expiry. This is fundamental. Unless we can make industry function properly in this country, I do not think that the Government are going to find it at all easy to correct the inflation. They have made an immense effort. I entirely applaud what the noble Earl, Lord Gowrie, said. They have made an immense effort, but it has imposed a terrible stop on our industry, and it is really essential to knock away the props which prevent industry from functioning. The Government have done a good deal in that. A lot more wants doing.

The consequences of not getting our industry to function properly again are really too serious to be contemplated in our present debate. The revenue, the income, the jobs, the trade, everything depends on industry being revived and allowed to progress. It is terribly important to get this going as soon as possible.

My Lords, we all have an enormous common interest in this country's recovery. I hope that all of us of all parties will appreciate and give expression to that common interest.

5.25 p.m.

Earl De La Warr

My Lords, I want to begin by giving your Lordships one fact which I believe is central to our debate today. It is this: over the last 10 years our production has increased on an average by 1 per cent. a year. That is something just over 10 per cent. During the same time our wages have increased by 320 per cent. is it any wonder that we find ourselves in trouble and suffering worse in this world recession than almost any other country in the world? It is in the light of this shocking state of affairs that we have to determine to what extent, if any, new laws can help us out of our troubles.

It is just seven months since the Employment Act came on to the statute book. It is not a very long time in which to judge what effect the Act has had and whether we should be thinking about further laws. Just one winter it has had: a winter clouded by recession that has created a very different industrial climate from that which existed when the Bill began to weave its way through Parliament. Not a good time in which to judge how far it has succeeded.

Be that as it may, we have the Green Paper and we must look carefully at it. But please remember that the law—and this has been put well already—is only one small part of industrial relations. I hope that noble Lords will be very wary of an over-legalistic approach, and will look at every suggestion in the light of its effect on relations and efficiency as a whole in industry. I am bound to say that so far during the debate that has been the case. It really is important to give the 1980 Act a chance to work. Not all, but I think most of us agree that it was a right philosophy that led the Government to take a step by step approach instead of saddling industry and management with laws that they did not want and would not, or could not, enforce. If we are going to carry the country with us, as we must, it is essential to stick to the step by step approach. Mark my words, the alternative is confrontation and, quite possibly, a delay in our recovery.

Now there are many suggestions in the Green Paper for new laws that we could, or in some cases might have to, make. Of them, I say just this: pray God that we do not have to. I have seen too much of management at all levels, and more particularly at the lower levels, wrestling with employment law to the detriment of their real job of making money and creating wealth. Nobody doubts that trade unions have too many privileges, and often too little power to control their members, and that this is a very damaging factor in the economy. In spite of that I want—and I want passionately—to see industry spared from new laws for a good long time, because I believe that it desperately needs this. Since 1971 there has been a thorough surfeit of industrial legislation, and I cannot see that it has achieved very much in terms of efficiency. So I say once again, I am totally opposed to any further legislation in the foreseeable future.

Does that mean that I am suggesting that the Government should be supine, or inactive, in this field? My Lords, it means no such thing. I have chosen three suggestions to make to my noble friends on matters where I believe that early action is important; action that in each case can be taken without any addition to the statute book. The first concerns existing closed shops; the second concerns secret ballots; and the third concerns employee consultation and involvement.

While I am pleased to be speaking after the noble Lord, Lord Rochester, that is really a parliamentary way of saying, "Wretched chap for taking the best part of my speech ". However, to deal first with the closed shop, we discussed aspects of it last week in a short debate about the sacking by Sandwell Council of Miss Harris. With one exception, noble Lords condemned their action as disgraceful, and so it was. All closed shops, with their threat of the sack for workers who fail to toe the line, are intolerable intrusions on personal freedom. For the best part of a decade, my colleagues and I succeeded in fighting off every year, and sometimes more often, demands for a closed shop by the General and Municipal Workers' Union. We simply said, no, and eventually it went away. As a result of the Employment Act, I believe there will be no spread of new closed shops. The fact that Sandwell Council and NALGO made an agreement to have one just before the Royal Assent seems to show that they saw it that way too.

There are, however, more than 5 million people in existing closed shops. Many employers (I know not why) and all unions like closed shops, but what I want to know is how many of those 5 million people are happy about being in them. They seldom, if ever, had a chance to say yes or no; it was all agreed over their heads. I should not have thought it would be too hard to find out how those employees felt. There are many well-tried sampling research techniques by which the position could be estimated with considerable accuracy, and I believe there are very good reasons for using them. There would be no compulsion, for no one being questioned by an interviewer need reply. Everybody is used to it, whether they are being asked about anything from soapflakes to sex, and people do not object to interviewers coming round to talk to them.

Clauses 42 and 43 of the Code of Practice on closed shops make recommendations about the need for reviews, even if they are not so positive or precise as some of us would have liked. But something needs to be done now to trigger them off, and I should like to see the Government, after careful research, discussing with selected companies how they should set about a review. I would remind your Lordships that one of the reasons given for reviews in Clause 43 of the code is: where there is evidence that the support of the employees for the closed shop has declined". But no new laws; just a step-by-step beginning in squeezing this virus out of our society by slow but constant pressure from willing employers and the Government alike.

I come to the question of secret ballots, on which, I remind the House, we have yet to have a code of practice. I am surprised that in this context the Green Paper discusses only strikes, and I suggest to the Government that they start by dealing not with strikes but with the election of officers at all levels; in fact, with the exception of strikes, all the things mentioned in Section 1(3) of the Act, namely: (b) carrying out an election provided for by the rules of a trade union; (c) electing a worker who is a member of a trade union to be a representative of other members also employed by his employer; (d) amending the rules of a trade union; and (e) obtaining a decision on a resolution to improve an instrument of amalgamation or transfer ". There is a strong case in my view for getting on with that, and the Government should be making a start. It would command wide support in the country, for the cabal-like character of most unions is widely know and equally widely disliked. The Government must do something to trigger off the provisions of that part of the Act. It is so important that it must be made effective in the not too distant future. I therefore urge my noble friend to appoint a certification officer, to involve ACAS in talks with the unions and to issue a code of practice without too much delay. It would be a great step forward and by far the quickest way to get secret ballots into everyday use.

The last four pages of Chapter 1 of the Green Paper deal very cogently with the need for much improved communications in industry between management and workers. In the Green Paper the Government have confined themselves to the exhortations to which I have referred, not surprisingly perhaps because the object of the Green Paper is to discuss the need for future laws. But I do not believe one can deal with the effect of new law on industrial relations and efficiency without dealing too with the need to involve the workforce in decisions; it is, after all, the other side of the same penny.

Not enough effort by half is being put by most companies into communication with and involvement by employees. The average man still looks no further ahead than next week's wages and unless we can change attitudes, then, as has been mentioned, when world prosperity returns there will be a terrible danger that we shall be on the same old merry-go-round as before. We had Bullock; he had the right idea but very much the wrong way of going about it. And just across the English Channel—I mention this lest your Lordships forget it—is lurking the Fifth Directive of the European Economic Community on company structure and employee participation, a fearsome document if ever there was one.

My message to the Government is that they must lean hard on industry, but that is not interference with management. It is simply reminding it sharply of an essential part of its job. That is now a prime duty of the Secretary of State, far and away more important than all the legislation ever thought of. This country's industry is in deep trouble. Unemployment continues to rise and our industrial base is by no means as secure as it might be. Once again I beg the Government to lay off making new laws for industry and leave it to get on with its job. That to me is the true, the traditional, down-the-middle Tory way of carrying along the whole nation with us in the job of recovery that lies before us.

5.40 p.m.

Lord Scanlon

My Lords, if I may, I should like to educate your Lordships in the intricacies of industrial negotiations. It is an unwritten law that the shop steward never praises the rate fixer, for if he does, the employer will quickly remove him. But I want to disobey that rule today and say how much I agree with the noble Earl, Lord De La Warr, in his main contention that there should be no further legislation on industrial relations, and that it should be left to what one hopes is the good sense of employers and trade unions and their respective representatives to work out a system that is suitable to the particular industry faced with its own problems.

Therefore, if the purpose of the Green Paper is to encourage discussion on the pitfalls, difficulties, and problems of a further extension of the law into industrial relations, then it is good, it is very good. However, if what the Green Paper contains are meant to represent serious proposals to satisfy dogma, either in another place or in your Lordships' House, then it is bad, it is very bad. So one approaches the Green Paper with very mixed feelings, almost like watching one's mother-in-law go over the cliff in one's new car.

I am not qualified, nor do I desire, to speak on the intricacies of the law, but rather I wish to emphasise that industrial relations is about human beings, about people. It is not an exact science. Certainly, in the main, it has no place in law. A company can plan its workload, cost effectiveness, profit margins and overseas sales, and all that can be upset immediately because a shop steward has had a row with his missus, or the works manager has lost at bridge or golf the previous evening.

I should like to take three points from the Green Paper. The first relates to the immunity of trade union funds, and I shall have to bore your Lordships with our experiences as a trade union during the life of the Industrial Relations Act. We were perhaps the only union that challenged the law in every sense. That challenge included our refusal to recognise and to attend the Industrial Relations Court, and we suffered the penalty, as anyone must suffer the penalty if he does not obey the law. During those three and a half years the cost to our members was over £8 million. Perhaps some noble Lords opposite will say, "Not half enough ", but before doing so I would ask them to consider the loss not only in terms of legal fees, fines imposed by the court, dispute benefits, and the sequestration (I had never before heard the word) of our funds, but also in terms of loss of production, loss of earnings for our members, and the development of acrimony and hostility between employer and employee, some of which is still with us, unfortunately.

Despite all those factors, despite losing for a temporary period everything that we had, we quickly learnt, if we had to learn, that the strength of a trade union—any trade union—lies not in money in the bank, not in palatial offices or in electronic typewriters, but in the justness of its cause, the conviction of its members, their determination and their solidarity. No matter what the law says, people will rightly seek to uphold those ideals. Therefore, our experience was that the more the law interfered, the more that it was punitive against us, the more our members were determined to stick by the ideals in which they believe.

Secondly, I should like to take up the point made by the noble Earl, Lord Gowrie, in perhaps quite correctly forecasting and drawing to the attention of the House, what might happen when trade unions disagree with Governments, as we did regarding both In Place of Strife and the Industrial Relations Act. But the noble Earl was careful to omit what happens when a trade union co-operates with Government, when a quid pro quo can be arranged. Let me remind your Lordships, if a reminder be necessary, of the situation that existed in 1974–75. Inflation was running at between 26 and 30 per cent. The balance of payments was well and truly in the red. Not only had our foreign competitors written us off, but many people in this country had begun to write themselves off. In that situation there was arranged a deal—yes, a deal—which subsequently became known as the Industrial Strategy, in which 38 working parties were set up to diagnose the problems of production and, it was hoped, to resolve them. The deal involved the so-called Social Contract, in which some of us, having experienced what I have described under the Industrial Relations Act in order to maintain free collective bargaining, stood on our heads and lost friends of a lifetime, so as to do a deal with the Government. It was a deal which we believed would bring down inflation, bring about higher investment in industry, give us the new technology, and make us more competitive.

In case anyone should think that I am saying that only trade union members suffered, let me add that in the three-and-a-half year's that that situation existed this country accepted lower living standards in order to try to bring about that investment. Perhaps in the first stage middle management in particular suffered more than most because of a cut-off point of £8,500. But the deal brought down inflation to single figures within the three years.

There was, however, a strike—a strike which in my view did more damage than any of the strikes of labour that have been talked about. It was a strike of capital. Despite all the sacrifice, despite people doing the deal, the investment was not forthcoming, and to some extent we are today still suffering from that lack of investment.

I should now like to turn to the second point, regarding picketing; and what I have to say here might sound strange, too. Given that in any dispute involving a certain employer and a certain number of trade unionists every effort has been exhausted to find a solution, I have never lost any sleep about picketing. Either one has a good case that one has not explained to one's members, or one has not a good case. If pickets are needed to convince people not to go into work, one of those two possibilities is involved. So picketing in that sense is not the issue as I see it. But given that an employer faced with a strike or a lock-out decides that he is then entitled to use any sanctions that he thinks fit—including getting material from places where it was never obtained before; including sending the work out, perhaps, to be done elsewhere; and including, perhaps, involving non-union labour to replace those on strike—are the trade unions not entitled to call upon their allies by way of a quid pro quo and to say, "You will not succeed by those tactics "'? It is far better that these things do not arise, but we are living in the world as it is and not as many of us would like it to be.

The third thing I want to talk about is ballots. Here again I agree with the noble Earl, Lord De La Warr. Let us have ballots—but not ballots only for strike action. I have had 40 years in which I have been fighting elections either to secure my own return or trying to get further up the scale, and I always found that if you were able to do a job you were sometimes returned and given an endorsement by your electors, whereas others found that they were thrown out. That is the occupational hazard you accept when you do yourself the favour of becoming a full-time official in a union which has ballots. It is not a bad thing, but, please, do not think that it can be confined to the idea that you just have a ballot about strikes.

I have two other precautionary points. Do not think it is going to be easy to persuade those unions that do not have ballots, because they will argue that, come a crisis, a person appointed is more likely to do the right thing than the popular thing. Secondly, do not believe that by the election of officials you will have docile officials. You will have officials who are much more representative of their membership and who reflect the feelings of their members; otherwise, they will suffer the fate that so many suffer when you have ballots—namely, that they are defeated in an election.

I would hope that I have said enough on those points. There are many other issues in the Green Paper, but I want to turn now to one of the points that the noble Lord, Lord Hankey, referred to, and that is this phrase which is going around now, "A new air of realism ". Is it an air of realism, or is it Government and employers saying, however delicately, "It is our turn now, and we will show you "? On the other side, is it equally true that trade unions may well be saying, "But our day will come "? I believe it is honest and straightforward to say that unemployment does have a delaying and a restraining effect on the demands of trade unions. That is why we detest unemployment so much; that is why it is frank to say it to your Lordships' House. But if it is true, why exacerbate the situation by presenting a Green Paper which may—I emphasise the words "which may "—increase that acrimony at a time when we should be seeking how best we can co-operate in order to face the problems of the upturn in the economy as and when it comes—as come it must?

So I do not dissent at all from the idea of having no further encroachment by the law into industrial relations. Perhaps I may quote somebody who, I would emphasise, although speaking in his personal capacity, just happens to be the director-general of the Engineering Employers' Federation—an industry, let me remind your Lordships, that has not been free of disputes; an industry that until recently had a procedure that did not even have a status quo clause: and an industry which said in all the negotiations that went on that even if it took 12 months to negotiate an agreement after the last one had expired there would be no retrospective pay. That is how had the industry was, and yet, although speaking in his personal capacity, Mr. Frodsham said that the Green Paper and the public debate which it is activating could perform three main functions. First, mere debate and nothing more in the way of action. Secondly, it could actually lead to further legislative action limiting union immunity. Thirdly, it could look for Utopia, trying to reach a permanent settlement of the industrial relations system by the general agreement of politicians, unions, employers and the whole of the community. I have paraphrased him—or, at least, I have not quoted him verbatim—but I do not believe out of context. He continues: I conclude that only the first of the above three functions could serve us well, and even that depends on a fundamental change of attitude". I believe we can set the atmosphere for that change of attitude, and that is why I join with those who are appealing to the Government to recognise that employers and trade unions can resolve their own difficulties. They will make mistakes. I hope I do not bore your Lordships by saying that I go round to schools speaking to many sixth-forms, and am always beset at the end, at question time, with what was in the Daily Express or the Daily Mail that morning about who runs the country, the closed shop and the trade unions ruining everything. I always answer with a killer line which says, "I have been abroad as much as the rest, and with all our faults and with all our difficulties I am always glad to get back here ". Then I used to finish up by saying, "Have you ever seen a happy Swede? "That was until one bright youngster floored me and said, "Yes—in a blue film ".

So I have never used those words since; but that indicates to your Lordships that there are issues which perhaps we shall not resolve, that we shall make mistakes, and that we cannot have Utopia. But I believe that the Government should listen not only to their friends but to their opponents as well, who say, "This is not the way. Please, you have had your 1980 Employment Act, you have resolved some of the problems that you thought existed. Now let industry and trade unions get on with the job of resolving the problems that will undoubtedly arise in the coming months ".

5.58 p.m.

Lord Cottesloe

My Lords, we live nowadays, as it appears to an old man, in a strange world of paradox. We have revenue officials, who have in the last two years received some 50 per cent. of increases in their salaries and have a security of tenure and the prospect of index-linked pensions not available to the ordinary citizen, so discontented that they are busy inhibiting the Treasury from receiving the monies from which their own salaries are paid. We have responsible trade union officials—and let me say that I do not include the noble Lord, Lord Scanlon, in this; I agreed with almost everything he said—telling us that ballots are undemocratic, and that the only democratic process is that people should stand up to be counted, by which, of course, they really mean that they should stand up to be intimidated. They cannot, anyway, really be counted in a mass meeting.

We have workers in concerns that are on their beam ends going on strike to prevent those concerns from closing down altogether, when they must know perfectly well that the only hope of recovery lies in increased production. We have some urban local authorities who receive about three-quarters of their revenue not from the ratepayers to whom they are responsible but from the Government's block grant and from business interests that have no vote. Local authorities are in consequence wildly profligate and there, indeed, is power without responsibility.

Such things would be laughable if they were not so tragically serious, serious in themselves and in the complete disregard of common sense and of responsibility of which they are symptoms. The immunities of the trade unions share some of these characteristics, and so we must all—and I was going to say, "perhaps, with the exception of Lord McCarthy ", but I do not think he is here now—welcome this Green Paper and the opportunity that my noble friend Lord Renton has given us to discuss it: the Green Paper with an admirably objective account of the history of trade union immunities that were first introduced in 1906, three-quarters of a century ago. At that time the trade unions were weak and the employers immensely strong and these immunities were granted, in my view, wisely, to ensure that the financial penalties that the unions might incur would not destroy them.

The balance has now changed. The trade unions are now immensely strong, both financially and in their power to dominate the community, the employers and the general public alike. If these immunities did not exist, no one would now think of inventing them. They are unparalleled in any other country in the world; but there is no practical possibility whatever of their being abolished. All that can be done—and it should be done—is to prevent them from being abused and, if necessary, limiting them for that purpose; for immunities, if made use of without a proper sense of responsibility, lend themselves to abuse. One has only to look at quite another field, at the statistics of the number of parking offences in London for which diplomatic immunity is claimed, to see that.

The powers that arise from trade union immunities can be used, and are at times used, as instruments of tyranny; and tyranny is intolerable in a civilised society and must always be resisted. It is such abuses of these immunities which must be curbed. These abuses arise in two particular fields of trade union activity: the field of picketing and the field of the closed shop. In the field of picketing, we have seen in recent years mass picketing and secondary picketing used in ways which are quite indefensible—mass picketing to prevent peaceable citizens from going about their work, by intimidation, by threats of physical violence and by sheer weight of numbers to a degree that is intolerable and grievously damaging to the economy. I hope, without any great confidence, that the Employment Act of last year with its code of practice may be enough to prevent such abuses. If it is not, it must be reinforced.

Then we have the phenomenon of the closed shop. The closed shop is, in some circumstances, a convenience for employers as well as for the unions; but it can be used both by employers and by unions alike as an instrument of tyranny that deprives men and women of their employment in a way that is quite indefensible. We have seen this in a number of cases in recent years, and it was very plainly exemplified in the events at Sandwell and at Darlington that were detailed in our discussion last week on the closed shop. It is clear that such behaviour, whether by employers or by trade unions, must be prevented. If that can only be done by modifications of the law, then those modifications should be and must be made.

More generally, the fact is, as was made so clear by the failure of the Act of 1971—well intentioned but ill conceived—there are limits to what legislation can do unless it has the full support of public opinion. What is needed and what we should all apply ourselves to creating—and this is where I so deeply agree with the noble Lord, Lord Scanlon—is a climate of opinion in which employers and unions, central and local government, will all work together with the fullest consultation and co-operation to promote throughout industry and throughout all our affairs, the greatest possible measures of productivity and efficiency, for only in that way can the prosperity of this great nation ever be restored.

6.6 p.m.

Lord Harris of High Cross

My Lords, I must thank my noble friend Lord Spens for so kindly agreeing to change places with me because I am prevented by a previous engagement from staying until the end of this debate. I have enjoyed every speech that I have listened to and I congratulate my noble friend Lord Renton on his eloquent expression of a difficult Motion and on his moderate proposals with which I would go along the road with him. I want to confine myself to elaborating a criticism of the Green Paper which was voiced by one of our most distinguished columnists, Mr. Samuel Brittan, of the Financial Times, who last January lamented over this Green Paper by saying: It is written entirely from the point of view of industrial relations experts and lawyers with no analysis of the economic issues". This has been a rather bad week for economists. I need not emphasise that economists are not famous for agreeing on the outcome of economic issues. They do not sing the same tune or even croak the same tune. It is therefore all the more remarkable that there is one issue on which there is wide agreement, embracing all schools of political and philosophical thought among economists, and that is on the nature and effects of monopoly power. One of the most universally accepted generalisations of economic analysis is that where you have a single supplier, or a number of suppliers acting together, who can control the quantity of a product or service coming on to the market, then the outcome is that less will be taken up at a higher price. I make no apology for inviting discussion on trade union law as an aspect of the economic analysis of monopoly power.

It cannot be denied that the legal immunities of British trade unions give them considerable power to impose terms of employment on vulnerable management through the legal right to picket, to break contracts, to boycott, to blockade, to enforce closed shops. A trade union, as we know, is able to enforce a wage increase above the level that would be afforded by profitable output. In that situation there are a number of possibilities. Suppose an employer can pass on the higher wage costs in the form of higher prices. Very well. The worker gains, but at the expense of the consumer. On the other hand, if the employer cannot pass on the full wage cost in higher prices, because he faces a competitive market, it is clear that he may be driven to reduce the number of people he employs and he may be driven in the end to go out of business altogether.

That is one damaging effect of the trade union acting as a labour cartel exerting monopoly power in the market: it can reduce the demand for labour and cause unemployment. Even then union leaders will say: "Very well, yes. But we have raised the wages of those who remain in work. "

But come again to the other regular activity of trade unions over my lifetime, in exerting their power to prevent management from installing more efficient equipment or imposing overmanning in the short-sighted hope of maintaining their levels of employment. The results must always be to damage the competitive efficiency of the employer and so simultaneously to depress the real wages of the workers as well as tend to raise unemployment.

All this is very much a matter of common sense rather than economic analysis. Yet it raises the question that is wholly neglected in this kind of debate: whether the unparalleled power which British trade unions alone in this world possess is in the best interests of their members, let alone in the interests of the wider community. My answer from both history and economic analysis is that our unions have used their monopoly power to restrict the opportunities of British workers to enjoy higher wages and higher employment. By obstructing the installation of new machines and changes in working methods, British trade unions have retarded economic progress in Britain, especially in our older industries, and they have contributed to our relative decline which has brought in its wake industrial contraction, unemployment and lagging standards of living.

The legal entrenchment of trade union monopoly power by Conservative, Liberal and Labour Governments over the past century seems to me to provide one of the most tragic examples of the contrast between questionably good intentions of politicians and unquestionably bad outcomes. It was very difficult, listening to the noble Lord, Lord Allen of Fallowfield, and the noble Lord, Lord Scanlon, to withhold admiration from these trade union heavyweights in their moderation and argument for co-operation. I shall not withhold admiration for their speeches but I shall withhold agreement. My Lords, they are wrong. They are wrong to suppose that strong trade unions require the battery of controls which they cling to from practice and habit.

The evidence is in the Green Paper—if you look into the Appendix and consider that you have strong and effective trade unions, delivering higher living standards for their members in Germany, that do it with no closed shop. They do it with no power to breach contract, they do it with no political affiliations or strikes; and by agreement not by law most of the unions—it says 16 out of 17—have agreed that there shall be no strikes without approval by ballot of 75 per cent. of their members. We should have learned from hard experience that it is no good arming sectional interests—which trade unions clearly are—with monopoly power and then exhorting them not to misuse it. The lesson of economics and of our history is the old truth that monopoly has no use save abuse. We now find the damaging effects of the monopoly power of trade unions have backfired and have caused loss to the workers in holding back living standards and imposing higher unemployment upon them.

If that kind of argument sounds far fetched to well-meaning union spokesmen, let me say that the danger I am talking about was better understood as recently as 1944 in the famous Coalition White Paper on Employment Policy. There will be found the following sentence: Workers must examine their trade practices and customs to ensure they do not constitute a serious impediment to an expansionist economy and so defeat the object of a full employment programme". It was from this White Paper that there sprang, from 1948 onwards, a series of statutes against monopolies and restrictive business practices which have—rightly, in my view—been extended to the restrictive practice of the time-honoured professions. Yet the curious paradox is that, while the Governments of both parties have always been alert to check or dismantle the monopoly power of industry and commerce, they have failed to apply the same logic to the far more crippling effects of trade union monopoly in the labour market. There is in the Green Paper a passing reference to the need to: recognise that job security and increased rewards can come only from an efficient industry competing in world-markets". That being said, there is no attempt whatsoever to relate the battery of trade union legal privileges to monopoly power and its baneful economic consequences.

There have recently been a number of studies of the effects of unions in raising the costs of labour above the market clearing levels. One conclusion from the University of Liverpool is that long-term unemployment has thereby been increased by anything up to 800,000. On top of that is the damage in discouraging new investment caused by the lack of co-operation by trade unions, which the noble Lord, Lord Scanlon, jestingly calls a strike of capital.

It is in the workers' cause of higher wages and higher long-term prospects of employment that I urge the Government to curb the immunities of British trade unions which are not suffered by any of the more successful countries listed in the Appendix—and it is the Appendix which is the best part of this rather disappointing and sterile Green Paper.

Baroness Gaitskell

My Lords, before the noble Lord sits down, may I ask him this: He spoke about monopoly power of the trade unions. What about the monopoly power of the employers who can throw millions of people out of work? Is not that the same? Why monopoly power only of the trade unions? The employers have the same power, call it what you like.

Lord Harris of High Cross

My Lords, when the noble Lord, Lord Scanlon, said how could we expect unions not to allow employers faced with a strike to resort to other sources of supply, to other possible sources of labour, he was making the point exactly that in this kind of dispute both sides tried to deploy the alternatives available, and the union's purpose is to confine the employer to supply only from the union. That is a totally different situation from almost every industry where there is a multiplicity of firms whose interests in many respects are divergent rather than convergent.

6.18 p.m.

Viscount Rochdale

My Lords, I should like, with other noble Lords, to congratulate my noble friend Lord Renton on having introduced this debate. It is a very important debate. I apologise to him in advance if I do not agree with all that he may have said. I should also like to say how much I appreciate the Green Paper, which I think has been an extraordinarily valuable document. I do not know whether I am in order in making a critical comment on something in that context that the noble Lord, Lord McCarthy, said because he is not in his place at the moment. But, as he wound up his speech, he questioned the sincerity of those who drafted and put forward the Green Paper. That was very unfortunate.

However, it gives me an opportunity to make a point which is relevant to the discussion. We are very weak in this country in the ability to accord to the other side that their motives are sincere. This is most important. Management must recognise that trade unions are sincere in what they are saying and doing. Equally, trade unions must recognise the sincerity of management. Unless there is that un- doubted sincerity, industrial relations have little hope of success.

Turning to the Green Paper, I am no lawyer and the Green Paper seems to me to bristle with all sorts of legal arguments and counter-arguments. I make no complaint about that because I recognise that in the last run every facet of our complex life needs to have clear-cut legal limits beyond which none of us, whether management or trade unionist, shall be allowed to go. My long association with industry—now, I regret, becoming something of a memory—leaves me in no doubt that the need for clear legal limits is as true in the field of industrial relations as anywhere else in our economy. But there is in this particular field a difference: I think great caution is needed in the fixing of those limits.

I should like to take one or two very general points which will cover the general field of secret ballots, industrial action, secondary action, picketing and immunities, although I do not intend to refer to any of those specifically. That, however, is the field within which I want to make a few general remarks. I believe that today the kinds of problem that need to dominate the thinking of those who operate in industry are not so much problems of a technological character, important though they are, as problems which are much more subtle, much more obscure and which occur at the human interface, if I may put it that way, where there is a need for the clearest possible systems of communication and understanding—systems which must be every bit as sophisticated as their parallel in the technological field. I find it helpful, when considering this sort of subject, to try to imagine myself back on the shop floor, in the office, in the conference room or even in the board room, and to remind myself that for the most part employees (and in most firms today all are employees from the chairman downwards) are reasonable, ordinary human beings—often one's friends—likeable, sensible people who are usually prepared to listen to reason and sound argument. Even if in the end they do not agree with you they are at least ready to follow through the negotiating procedures before contemplating industrial action. I think that that is absolutely true and that statistics would bear me out on that point.

The trouble, of course, is—and this is also true—that the phrase I have just used, "reason and sound argument" is not always the prevailing climate and, certainly when a storm appears on the horizon, does not reach those concerned in time. Then the lack of it can, of course, create, what we have all experienced: frustration, irritation and the reason for a certain amount of irresponsible action—perhaps action that one afterwards regrets. It also provides a ready seedbed for subversive thoughts and actions.

In my view, the reason for this unsatisfactory situation cannot be laid at the door of Government. Government may help, but this is not a subject for fresh legislation, in my view, but rather a subject for very urgent and keen action with the internal arrangements, first, of managements and, secondly, of trade unions. The Government may help but the need and the primary responsibility is for internal action to improve the internal arrangements in managements and the trade unions.

So far as management is concerned, as I see it, the need is for better communications, better information, more genuine consultation, leading up perhaps to some form of participation. I am quite certain that the need for this is being increasingly recognised in industry. The noble Lord, Lord Rochester, referred to his great company, where they have brought this to a fine art, but I believe that it is far from adequate in industry as a whole. A great deal more needs to be done and there will never be any finality in it. What is sometimes forgotten is that not only will development in this way be difficult but it is bound to be very costly, and cost must be accepted if it is to be adequately thorough, particularly with the larger and more diverse companies.

I am sorry to feel that there must be many in industry who are much more interested in the technological side of problems and who feel that the industrial relations side is boring. This is a difficulty, but the importance of the industrial relations side is every bit as demanding and, in my view, should be not merely comparable to or even in step with but ahead of any change that is going to be made in the firm, whether it be a change of programmes for investment or for new technology, changes in methods of remuneration, changes which may involve closures, or any other form of change. If I may be slightly facetious for a moment, this brings the point home. We all remember that the building of the Tower of Babel came to nothing. It was not that the builders were unable to build but because the builders could not get on with one another; and it is the same in industry today.

So far as the trade union side of this problem is concerned I can speak only from impressions, but I shall stick my neck out and suggest that here again there is need for some urgent and continuing look at their internal arrangements. As with management, again it will be costly. I want to emphasise that these internal arrangements are going to cost a lot of money. They cannot be done by cheeseparing, but in this area of rapidly developing technology and methods it would seem to me that such an approach is absolutely imperative.

I am fortified in this view by reference to the Green Paper, where it says in paragraph 15—and this has been quoted before this afternoon—that 90 per cent. of strikes are now unofficial. That is a situation which speaks for itself and cannot be other than most alarming to all concerned. It is in the light of these considerations, both for unions and managements, that one has to assess the need and advisability for further legislation just now. I believe that there is considerable scope for improvement in the internal arrangements of both sides and, if that could be achieved, it could well limit the need for legislation.

But, of course, internal changes of that nature will take time, will take patience and will need encouragement from the Government. But, even then, there are bound to remain some—though I hope considerably fewer—potential trouble-spots. I am sure that neither management nor trade unions want further legislation. That is clear from many speeches that have been made in this House this afternoon. So am I being too naïve in suggesting that, given some indication of likely success in the way, given therefore a better understanding and willingness to make changes, so as to operate present legislation and to demonstrate better its adequacy, any further legislation—which could so easily be disruptive and, therefore, unremunerative and unhelpful—could be largely unnecessary?

Having said that, I see very clearly the counter-arguments which were so clearly put forward by certain noble Lords. I realise that if you are going to legislate there may be some danger in delay. But, on balance, I believe we should be wise to see what can be done and what can be made of present legislation along with the codes of conduct, because, given goodwill, the results could surprise us all.

But, of course, there may not be goodwill on either side and, unfortunately, that might drive us to further legislation. In that event, we should have to be prepared to recognise that we might have to endure a period of disruption, just at the time when progress and productivity are so particularly needed by us in this very competitive world.

There are other points in the Green Paper which I have not mentioned. I would just say this on the closed shop: I do not like it but, as I think other noble Lords have said, it is with us. It is clearly a very emotive issue. As yet, we do not have much experience of how it works within the present legislation, and I agree with the Green Paper that it is a matter which needs more very careful thought before any further steps are taken about it.

As regards Chapter 4—the question of positive rights, as opposed to immunities—I must say that, on the face of it, not being a lawyer, it has considerable logical attraction. It would mean, I understand, a major change in our system and would, as the document says, need to be expertly examined. But if this could be done objectively by all concerned, without any serious intention of being detrimental to trade unions; without passions being aroused to divert the true purpose of industry, which is the creation of national wealth, then I believe that it might well be warranted.

But it would have to be done willingly, dispassionately and objectively on both sides, and perhaps, at the end, we might arrive at something which—and this is important—would be more understandable in the public eye and, therefore, might even enhance the standing of the trade unions themselves. Having said that, I hope that the discussions which this Green Paper will call forth prove to be another valuable step forward in the field of industrial relations, which is so badly needed.

6.35 p.m.

Lord Noel-Baker

My Lords, I hope to make a simple speech on one point alone—what the noble Lord who preceded me has called an emotive issue—the closed shop. When I was young, I inherited a family view, a congenital view, of the question of the closed shop. My father, who built up a large engineering firm which, under his direction, employed 2,000 men, believed in the closed shop and made his works a closed shop. He was followed as chairman of the company by my two elder brothers, who both shared his view. I shared it then; I share it now.

My father had a long family tradition of liberal thinking. He had two great-grandfathers who fought in the American War of Independence in 1776, one on each side. The one who was defeated by George Washington retired to Canada, but, like his enemy who stayed with George Washington, he believed that he was a very progressive man. My father had a grandfather who was a landlord in Ireland. In middle age, that grandfather sold his house and extensive lands, hired a ship and sailed to Canada, having written in his diary, "I am going to a land where there are neither rich nor poor."

His other grandfather was a captain of one of Nelson's ships at the Battle of Trafalgar. He ended the battle with a lump of French lead in his leg—a lump of lead which he kept inside his leg until the end of his life. When the war was over, he, being a liberal man, emigrated—French lead and all—to Canada. Thus it happened that my father was born in a log cabin on the northern shore of Lake Ontario, in the then classless society of Canada.

When he was 25, he came to London. He was deeply shocked by the class traditions of this country. He was deeply shocked by the fierce struggle of millions of people to earn a bare living; by the hostility of employers to the trade unions and by the victimisation of trade union leaders. He believed that the trade unions had won for the working classes better status, better wages and better working conditions. He believed that they had done it by great sacrifice on the part of their leaders and of their rank and file, and that the non-unionists, who shared the benefits of better status, better wages and better working conditions, had made no proper contribution to the achievement of the privileges which they shared. My father, in short, believed that it was the social duty of every worker to join his union and so he made his works a closed shop.

Of course, when he came to London he joined the Liberal Party. He worked in politics. He was elected as a Member of another place, and he told me often that it was because he was a Liberal Member of another place that he had made his works a closed shop. Above all, he hated the persecution, the victimisation, of trade union leaders. And so did I while he was alive. But I had a personal experience of it long years later which I venture to recount to the House. I shall call the victim of my story by the name of Bob.

Bob was a highly skilled mechanic and a foreman in a works in a Midlands town. In a given year between the wars he led a strike by all the engineering workers of the town for what they thought was a justified demand. I knew the details. I thought it justified, too. But the employers would make no concession. They thought they were in a very strong position. In due course they starved their workers into surrender. When the workers had surrendered and the strike was over, the employers declared a lock-out and they starved the workers for months longer still. And when that was over and at last the generality of the workers got back their jobs, every employer in the town refused a job to Bob. He suffered starvation for months.

Ultimately he got a university scholarship. He was a very able man, with political ambitions in which I thought he was very rightly advised. I encouraged him with all my power. I thought that some day he would make a splendid Cabinet Minister in a Labour Government. When the university scholarship came to an end, the director of the local labour exchange took him on to his staff. The director told me often that never had the labour exchange worked so well as when Bob was there. He understood every detail of the working conditions and life of the men who passed through the exchange day by day and year by year.

But there came a general election. I encouraged Bob to fight a doubtful seat. I thought that it would be a start on his political career. He was defeated. When he came back to his home town, the director of the labour exchange wanted to take him on again, but the employers of the town persuaded the then Conservative Minister of Labour to refuse permission to the director to do what he desired. Bob was left without a job.

More months of starvation followed. By now he had a wife and baby. He was forced to seek a low paid job at the bench in a distant city, far from home. Gradually over the years—he could not afford to travel often—he lost contact with his wife. Gradually they became estranged. Gradually, to cut a long story short, after years of misery and hunger, Bob's nerve broke. He took to drink and he died. The nation had lost what might have been splendid service in high political office of state.

That memory alone motivates my view of the closed shop. If there were no unions, every worker would be liable to treatment like that meted out to Bob. And if everybody followed the example of Miss Joanna Harris, there would be no unions.

I end by saying that I have had close personal experience of trade union leaders at two epochs of my life. I was vice-principal of Ruskin College, Oxford, a trade union college. The governors were all trade union leaders. I had gone there from a noble institution, King's College, Cambridge, where we had distinguished men like Goldsworthy, Lowes Dickinson, Arthur Cecil Pigou, Maynard Keynes, John Clapham, John Shepherd and a score of others. I was used to the company of distinguished men. I found the trade union leaders in the Ruskin governor's committee moderate, able, distinguished men, without exception.

After the Second World War I had the privilege of being Minister of Fuel and Power. I was in daily contact with the trade union leaders of the miners, of the electricians, of the workers in the gas industry. I took part with leaders of the trade unions in the discussion with the Government of economic policy, the economic policy by which the then Government carried out the reconstruction of this country in the post-war years. That reconstruction was the admiration of the world. I venture to say that the leaders of the trade unions played a full share in those discussions and deserve much credit for the success of the policy which was pursued.

For these reasons, I still believe in the closed shop. I still believe that workers ought to join their unions. I hope to God that the carping criticism of the unions which goes on today will shortly cease.

6.47 p.m.

Lord Mottistone

My Lords, I hope that the noble Lord, Lord Noel-Baker, will forgive me if I do not follow him into the closed shop. I should like deeply to thank my noble friend Lord Renton for having put down this Motion for debate and for opening it so skilfully. He has invited us to look at this Green Paper with a broad vision. Like my noble friend Lord Renton, I think that the Green Paper is somewhat of a curate's egg. But, for all that, I think that the Government must be congratulated not only upon having produced it but upon having produced a document which, so far as it possibly can, tries to cover the ground concerned and to do so in as moderate and uncontentious a way as it can.

Lord Renton

My Lords, I wonder whether my noble friend would be so kind as to allow me to intervene. I cannot have made myself clear. I did not intend to refer to the Green Paper as a curate's egg, but to our present trade union system.

Lord Mottistone

My Lords, I apologise to my noble friend if I have got wrong the gist of his remarks. All the same, I think that it is a curate's egg. For a start, it is a good paper, but I do not think that it goes far enough. Very briefly, I hope to explain this point of view to your Lordships.

Before doing so, may I mention one point about which I am absolutely sure. In this connection, I reflect the view of many noble Lords, and certainly that of my noble friend Lord De La Warr. It is that I do not think we are in a hurry to have any more legislation. The 1980 Act must be given a chance to work. As I said during our debates upon the Bill before it became an Act, I believe that the step-by-step approach is the best way. Like my noble friend Lord Rochdale, I believe also that one must accept that there is sincerity on both sides of industry. If one does not accept that, there is no way in which we can get an industrial relations solution. I agree very much with the noble Lord, Lord Allen of Fallowfield, that industrial relations problems are always difficult and with that background I should now like to look briefly at the Green Paper itself.

It seems to me that the introduction in Chapter 1 and the history in Chapter 2 make it quite clear that there is a great deal that ought to be put right in such legislation as we have, and to me it points pretty clearly to the fact that there is a very strong argument for moving to a system of positive rights rather than immunities. But then when one looks further on at Chapter 4, (skipping for the moment Chapter 3) which deals with positive rights (and this is where the curate's egg conies in), I think one finds Chapter 4 very disappointing. Assuming for the moment that only one person wrote this document (which I am sure is not the case) it would appear that by the time the writer got to Chapter 4 he had forgotten what he had written in Chapter 1. Chapter 1 makes it clear that there is a very strong case for a change of a dramatic sort, but Chapter 4 does not really pick that up. I think Chapter 4 needs to be rewritten and we need to have a follow-up to this Green Paper, no doubt after it has been commented on. I think we need another Green Paper which examines this particular point in much greater detail.

Turning now to Chapter 3, that seems to deal with changes in the present law on immunities. I think we need an equivalent to Chapter 3, taking the same subject headings, to advise us on what it would look like to apply positive rights to the eight headings in Chapter 3. Then I think we should have a clearer idea of whether positive rights could be effectively applied, because on the whole Chapter 4 talks in much broader terms than merely tackling those specific issues. So I think there is a real need for further study because I am sure that the implications, if one goes back and reads over Chapter 1 and follows it up with Chapter 2, are that the present system is not in the best interests of the trade union movement, let alone in the best interests of industry, and therefore not in the best interests of the country.

There is a very good point in paragraph 72 on page 18, in the second chapter, which refers to the Donovan Commission's Report: The report's main conclusion on the 1906 immunities was not that they were too narrow or too wide but that, as a result of judicial interpretation, they constituted a legal maze". I think most people believe that on the whole the Donovan Report was a very balanced one and it was accepted as such by both sides of industry. That little extract points to the fact that we really must do something about the legal maze. The legal maze is with us. We have not got ourselves taken away from the immunities situation; it is there and it will go on and on. There is a problem, because what one is forced towards—and I was not particularly keen to be forced in this direction by this document—is the conclusion that we are inviting a total change. In general, my observation of the law as it passes through your Lordships' House is that a gentle adjustment bit by bit to what we have in existence generally seems to be (a) more palatable for the citizens at large, and (b) more likely to be successful because it is moderately changing rather than abruptly altering.

So if we do in fact follow the line that I foresee is going to be forced upon us, we must be doubly careful as to what we do, and for that reason I think we shall need at least one further consultative document which tackles the problem of the implications in detail, rather than superficially as Chapter 4 does now, as to what this really strong change would mean.

In conclusion, one of the reasons why it seems to me that we took the wrong direction in 1906, when we went for immunities rather than rights, is that the other countries which are referred to in the Appendix—and there are other countries in the world which could be added to that—have gone the other way and on the whole have been more successful. But I think the Appendix would be much stronger if it were supported by statistics over a reasonable length of time for the countries concerned to show what their experiences were, because we know that some of those countries (the United States of America is an example which springs to mind) have been through very difficult periods and they have also been through easier periods, and one needs to have this examined in detail before one can see how much their example is a useful one for us.

Finally, there are no two ways about it, the solution to the problems rests, as so many noble Lords have said, not in the law but in how the industrial relations are actually conducted. I also think that we have to make quite certain that whatever law we have prevents bullying by either side. At the moment there have been examples of bullying—I will put it that way—by the trade union side; we had an example from the noble Lord, Lord Noel-Baker, of bullying some years back from the employers' side, and I am quite sure that, given some sort of a change, perhaps in a way that went too far to give extra power to employers, we should again find bullying from them. But at the moment I would suggest that the balance is a bit too far to give bullying power to organised labour rather than giving bullying power to employers, and we must try to avoid either side having this ability (and that means the law) because only under those circumstances can we be sure that reasonable agreements are struck and executed and carried out by people for the benefit of us all.

6.59 p.m.

Lord Davies of Leek

My Lords, I have listened with interest to, and it is always a pleasure to follow, the noble Lord, Lord Mottistone, because (a) he is brief, (b) he speaks with sincerity and understanding, and (c) while one may not agree with what he says, we know that he says it with a clear conscience and he honestly believes it.

I, too, will cut my speech, and I am going to do a thing which I seldom do when I debate in this Chamber; I have to leave rather early. In cutting my speech I shall try not to repeat some of the arguments which have already been made. It has been an excellent debate and we are grateful to the noble Lord, Lord Renton, for that. Let us see what he has tried to do, because sometimes he seems to think that we have gone off beat. His Motion on the Order Paper is: To call attention to the Consultative Document on Trade Union Immunities (Cmnd. 8128) and to the merits of possible changes in the present law on these Immunities; and to move for Papers.". Fair enough. But I think at the back of his mind, as much as anything, the merits, he believes, are there and there should be changes. The proposals on these immunities in the Green Paper are not new; they have been there for a long time, and this Green Paper is shooting an arrow at a target which ultimately would suggest that we should change the law and restrict the right to strike.

I want to point out what I consider a marvellous illogicality. Every Member of this House praises the efforts of the trade union movement in Poland at the present time; the solidarity of the Polish trade unionists is a march to freedom. What are we trying to do here tonight in some of the speeches? We are trying to put the clock back so far as the constructive freedom of the trade union movement exists. Eleven times we were voted against earlier here when Lord Goodman went into the lobbies; eleven times the previous Labour Government was defeated on efforts to get a constructive trade union Bill through the House. One has, therefore, to think: why all the euphoria and eulogy of the Polish trade unionists when we are looking askance at those here? What is the ulterior motive? Why is it good for the Poles to stand up to a dictatorship and to stand up to that kind of society when it may not be good here?

Strikes are not, in the main, caused through politics at all. If I had the time tonight, as I previously would have had, I could discuss the latest Inspectorate of Factories report on our British foundries, where, in the 20th century, men are working in conditions 18 inches deep in foundry dust.

The Earl of Gowrie

My Lords, I should just like to correct the noble Lord on something, if he would be so kind as to give way. It is up to him whether he does or not.

Lord Davies of Leek

Yes, my Lords, of course I will give way.

The Earl of Gowrie

My Lords, before the noble Lord leaves the comparison with Poland, I thought that was rather unfair because there is nothing whatever in the Green Paper which suggests that there should be no right to strike. The Green Paper fundamentally is a debate about whether you have the right to strike and whether you have immunity from action in law.

Lord Davies of Leek

Yes, my Lords, I know what it says; I have read it. It says: The freedom of employees to combine and to withdraw their labour is their ultimate safeguard against the inherent imbalance of power between the employer and the individual employee". That is in the Green Paper. I am now paraphrasing. It lays down that this is a criterion of a free society. I support that 100 per cent. That is its opening gambit. But further down it makes suggestions as to what we should do about changing the law to limit those angles of freedom. The noble Earl knows that to be true. I will leave the example I gave.

I want now to take up something said by the noble Viscount, Lord Rochdale. I am skipping a lot of my speech now. He "dropped out ", and he said in funereal tones that 90 per cent. of the strikes were unofficial strikes. That is terrible. But let us get at the facts. This is the myth of the British unofficial strike disease. The facts are given in a pamphlet produced by the Department of Employment and Manpower, Paper No. 15; its heading is Strikes in Britain. This is a recent official Government pamphlet. Paragraph 125 of the Green Paper says: More than 90 per cent. of strikes are unofficial. This has been a constant feature of British industrial relations since the 1950s". The Green Paper has got that down, but it does not then qualify it. That is paragraph 125 of the Green Paper. Yes, that is true, but far more days are lost as a result of official strikes.

I will give a few figures. In 1971 the percentage of stoppages which were official was 7.2. The number of working days lost through official strikes was 74.2 per cent. So the figures go on, up to 1979, when the stoppages that were official were only 3.9 per cent., but nevertheless nearly 80 per cent. of working days lost were due to that. In other words, the unofficial strikes may be ticklers, like the one in the foundry in this health report, Safety in Industry, concerning men working 18 inches deep in dust. Men are not always striking for money; they are sometimes striking for decent temperatures and decent conditions, washbasins, lavatory accommodation, things that civilised human beings need.

The impression given there is that the British trade union movement comprises a lot of yoboes running around shouting for more and more money all the time. Of course there is some of that. And England is only protected from uncomfortable times because we now have a double economy; most people can only get by because the wife and the man are working and a double income is going in. They have their mortgages of the little houses they are trying to buy. If one of them loses employment then the shadow of poverty and the shadow of hunger falls on those houses. Let us remember that the unemployment we have had already has lost more time than a whole year of strikes. That figure I have given from an official Government document. Why was it not put in the Green Paper by the side of the quotation about unofficial strikes?

I turn to the protection of trade union funds. Who better than both the trade union noble Lords who spoke could give the illustration about the position of the trade union funds? Those trade union funds have a purpose. The attack on the basic right to strike is all entangled by trying to get a definition of what would be legal and what would be strikes that would be unlawful. Without getting entangled in those, there will be plenty of time for consultation and plenty of time for consideration in depth of those points. But I must take one warning. My noble friend Lord McCarthy opened this aspect when he was speaking from the Front Bench earlier in the debate. One of the stupid things about picketing is that the Green Paper proposes to make it unlawful to picket your own workplace unless there is a dispute between the pickets and the employer. Next—and this shows how stupid some Governments can be; sometimes Labour Governments can be stupid too—it requires the police to obtain the names and addresses of pickets if they are requested to do so by the employer. I come from Welsh farming and mining families.

I remember the 1921 strike and the 1926 strike, when police and miners and colliers would play rugby on the local fields and happily work together. What is this Government trying to do? I am quoting now a first-class daily Conservative paper the Daily Telegraph of 21st February 1980; and what did the police chiefs say? They said: It is quite wrong to suggest the police are on one side and the workers are on the other". Let us try to keep that clear. The Green Paper does not help in that. Then: We are impartial. Police are in the middle and have to be the totally independent element". That was said by the President of the Association of Chiefs of Police. Obviously this Green Paper needs a lot of discussion.

I promised to be brief and I shall keep that promise. I shall be another two minutes. The trade unions have not been asleep. I would suggest that noble Lords spend £2 and buy the Organisation and Structure of the Services of the Trade Union Congress, which was published in December 1980. The TUC has taken up the challenge of this Green Paper and the onslaught on the unions by themselves producing a consultative document. As I must keep my promise, I cannot go into it in depth, but it points out that trade union membership has jumped from 9.4 million to 12.1 million at the moment. Many of them are women and people who are responsible human beings who have known what the vision of unemployment does to their homes. They do not strike just willy-nilly. There are not many yoboes around in the trade union movement. It is a much higher educated movement than it was when I was a youngster. There are better educational opportunities, and standards of life are growing higher.

With a little intelligence and understanding any Government can work out formulae with industry. I like the suggestion that came from the Benches behind me tonight, that Parliament or this Government should initiate discussion between the trade union movement and the Government and bring in the British Employers' Federation. That should be one of the answers to the Green Paper. I have taken 12 minutes, and in 13 the House should be very grateful indeed!

Lord McCarthy

My Lords, before my noble friend sits down, would he agree with me on the issue of Polish Solidarity, that, of course, virtually all the actions of Solidarity would be quite unlawful in this country? It is very doubtful that, if there is a trade dispute in Poland under the terms of the 1974–76 Act, the action of Solidarity would be largely enforced by off-site picketing and forms of secondary action, which would undoubtedly be quite outside Section 17 of the 1980 Act.

Lord Davies of Leek

My Lords, I am more than grateful to my noble friend for putting one more minute on my speech, and I agree with him entirely.

7.12 p.m.

Lord Ferrier

My Lords, I am one of those who support my noble friend Lord Renton in his Motion for Papers, and I congratulate him on the way in which he presented his case. I regarded his speech as being very well balanced and unprovocative. By the same token, I am not altogether as happy about this debate as the noble Lord, Lord Davies of Leek, was when he said that it had been a good debate. It has been a good debate but, except for his speech and that of my noble friend, t got the feeling that we were out of touch with the people. We heard the same old story, the same old stuff which was very good and conscientious and based on good experience and on years of faithful work in the service of the trade unions and of industry. The noble Lord, Lord Scanlon, gave us some splendid fun with the material he used in his speech. However, I gained the feeling that we were a bit out of touch with what is going on.

I do not propose to join in the set-to, the pros and cons and the ebb and flow of the argument, because as my noble friend pointed out the Green Paper is a preparation for the future argument. From the way that my noble friend Lord Mottistone talked, I think that he was probably thinking of the White Paper which is to follow, because as regards that, we can have discussions. However, I want to speak for the man and the woman in the street and to declare in very strong terms that they—and I include myself in this—feel very strongly that we have heard enough of the trade unions as they stand today.

As they stand today, I emphasise they are of course an integral part of our industrial system. But I have watched the Labour Party's sensible intentions vitiated over the years. I have the greatest respect for the stance of noble Lords opposite—the noble Lord, Lord Blyton, and others who have given their lives to the improvement of the lot of the "shop floor ". I do not want to use the word "workers" because it is quite misleading to do so nowadays and, besides being devisive—often deliberately so—it is quite wrong. In our complex society all concerned in industry are workers, or ought to be and generally are so, whether on the shop floor, or in the board room. But the purity—and it is a big "but "—of their objectives has been diluted by the influx of socialism: Les idiots savants whose creed has brought this country and much of the world to the brink of disaster. Witness the curious contention of the right reverend Prelate the Archbishop of York the other day.

The fact is that this debate has ebbed and flowed until the position is one that is crystallised in my view in paragraph 383 of the Green Paper on page 92. What we are doing today, is to establish: the basis for a full and informed public debate". The contribution that I have to make at this stage is to declare that the public are fed up with the trade unions and many people's feelings are akin to those of the people in Auckland, New Zealand, who on 3rd March organised a march of 30,000 people through the streets of Auckland with the cry, "Kiwis care ". I went to New Zealand House this morning and I have in my hand the Auckland Star for 4th March. The girl who organised the march said: I'm just an ordinary person. I don't know a lot about politics. All I care about is the country". The article went on to say: She emphasised that the march was patriotic—not political"— and that speaks for me— and she was bothered by some politicians appearing to make capital out of the huge turnout. 'I didn't invite them. They came as individuals. They said "I'm a politician but I'm here as a member of the public". Why was it necessary to say they were politicians?' The march was not against unions or strikes, she said. 'It was against what this strike (the Air New Zealand engineers' dispute) has done to the country'.". That is the note that I want to strike. In the New Zealand News UK of 18th March, the leader ends with the words: It is now up to each of the political parties to come up with clear and definite policies which are aimed at easing the causes of industrial unrest and producing a society less divided than at present". I think that that is what we want to do.

I know that it is my noble friend's idea that that is what we must work towards, and it has been said from many sides of the House that we want improved relations. But I do not know how relations will be improved when the public are being put to tremendous inconvenience often by disputes which are between workers—not aimed at the public at all—and by what I would call the "dirty tricks department" of the trade union movement.

One of the hardest things of all at the moment is the fact that driving tests are being interfered with. The hardship is very serious for young people who have waited, studied and worked for months in order to take a driving test but cannot do so. Travellers are now threatened with strikes at the airports over the Easter holidays. Is it fair? I do not see how the relations between people, workers and employers can be improved if this sort of thing goes on. I had, for instance, a bit of a chuckle at my noble friend's namesake's Question to the Prime Minister in the other place yesterday; it was about today's meeting of the Neddy Council which the trade union representatives were unable to attend—and it was before 12 o'clock—because they would not cross the Civil Service picket lines. The hardships which the public have to bear are manifold. As I have said, the cruellest of all is the suspension of driving tests. I shall not go on or try to set out the manifold injuries which are inflicted on the nation, sometimes by disputes between workers. These have been gone into by various speakers.

In many years in industry it has not been my experience that industrial relations are always difficult. I think it was my noble friend Lord Mottistone who said that they were. They are not always difficult. In the ordinary way most companies do not have great difficulties; they may have differences, but not real difficulties. However, my mind goes to the suggestion of my noble friend Lord De La Warr and others that there should be no hurry to have further legislation.

My mind goes back to the speech by my noble friend Lord Brookes in the debate on the closed shop in this House the other day, when he pointed out that the "softly, softly" approach, of which I and most Conservatives approve, was different from the statement in the party's manifesto. I agree that the Government have, quite rightly, tried the "softly, softly" approach, but they have promised more stringent measures if it does not work. It looks to me as though it is not working. As the noble Lord, Lord Hankey, said, we want better unions; we want better co-operation; let us strain to that end.

However, how are we to achieve it if, despite what the noble Lord, Lord Noel-Baker, said, the closed shop cannot be abolished, as so many people think it should be without further legislation? When my noble friend replies I think he will have to say that we cannot go on like this, with the public suffering as they are from ridiculous strikes which need not be, and without facing the fact that the Conservative Government are determined that there should be a proper reform of industrial relations.

7.23 p.m.

Lord Spens

My Lords, I was about to begin by saying that I was surprised that until my speech no one had spoken up on behalf of the public, the innocent third party. But the noble Lord, Lord Ferrier, has just anticipated me a little in his speech. I entirely agree with him that it is the public who are fed up with the treatment that they are getting at the moment and for which they have no redress. I believe—and I support the noble Lord, Lord Renton, in this—that something must be done, and done quickly, to enable them to get that redress. To this extent I am afraid that I do not agree with the noble Earl, Lord De La Warr, that no further legislation is necessary. I believe that further legislation is necessary, but it could be contrived in a way that ought not to affect relationships between employers and employees.

In my introductory remarks I want to make one other point. I do not agree with certain noble Lords, such as the noble Lord, Lord Hankey, who believe that the changes can be carried out by having positive rights rather than restricting immunities. I believe—and I think that the noble Lord, Lord Renton, said this—that to introduce positive rights is a very dangerous situation because those rights become permanent. I remember arguing that last year when the Employment Bill was going through the House and when certain secondary action was still being allowed in the form of positive rights. That was something about which we were very upset.

Therefore, I should like to see the immunity of the unions restricted to the extent that they become liable for any damages which they cause to third parties. That is quite a considerable restriction, and it means that no secondary action and no secondary picketing would be lawful—and by "lawful" I mean something lawful under the civil law. They would be liable for any damages they caused to the third parties.

In order to make this point stick, I want to go further than the noble Lord, Lord Renton, and say that unions ought to be made liable for the actions of their members. At the moment they are not. It is no use giving that liability to the public to pursue against individual members of a union. They must be able to pursue it against the unions themselves. If that were to happen, there should not be all the problems which have been suggested; for example, the problem about the police.

If no secondary picketing at all is allowed, the police must treat any secondary picketing which appears as something with which, if it causes an obstruction, they would have to deal. It does not necessarily mean that they would be chasing every secondary picket who arrives, but if they considered that such a picket was causing an obstruction, that would be an offence with which the police would deal in the same way as they deal with obstruction by anyone else. I see the noble Lord, Lord Scanlon, shaking his head, but the police are quite capable of dealing with obstructions which are caused by some of the processions that we have seen in recent months, particularly those of the National Front. In those cases the police have been perfectly able to cope.

Lord Scanlon

My Lords, perhaps I could intervene to ask a question and to give the reason for shaking my head. How is it possible to marry the principle that peaceful picketing can be permitted, and lawfully permitted, yet at the same time if someone goes on the highway to stop a lorry driver in order peacefully to try to persuade him, that person can be charged with the crime or the offence of obstructing the Queen's highway? That is why I was shaking my head.

Lord Spens

My Lords, I think that that is the situation at present. Therefore, there would be no difference if secondary picketing were to be made liable under the civil law. It would only be liable to third parties. I agree with the noble Lord, Lord Scanlon, that if one of those third parties started to help an employer, then the unions should have their immunity to deal with him; he would no longer be a third party. But otherwise there should be no immunity for damage done to innocent third parties, to members of the public.

There is not time to go into the details about this, and I do not want to delay your Lordships at this rather late hour. But I want to say finally that I am surprised that in various discourses to which we have listened in the past about the decline of the British economy from the end of the last century no one has tried to link that decline with the rise in the power of the trade unions. I believe that there is a definite link. Although I am not saying that the trade unions are completely and only responsible for our present economic situation, I believe they are responsible for a large degree of that situation because of this immense power which they have now received. I hope that the Government will take action soon to help the public by removing the immunity of the unions in their case.

7.31 p.m.

Lord Ellenborough

My Lords, I too feel greatly indebted to my noble friend Lord Renton for initiating this debate and providing an opportunity to take part in it. I think all noble Lords are grateful to the noble Lord, Lord Scanlon, for finding the time to come and give such a valuable contribution from his wealth of experience in the trade union world. He perhaps will not mind if I say to him that I may need a series of educational lectures before I go all the way with him.

The Prime Minister has invited those who feel strongly about the issues under discussion today to make their views known to the Minister. I shall speak quite briefly as a layman. I did not take part in last year's debates on the 1980 Act, and rather reluctantly acquiesced in what many felt was a woefully inadequate measure. Of course I fully appreciate that politics is the art of the possible, and the step by step approach is right in principle, but I feel that the steps taken are rather fairy footsteps in the dark and hardly discernible, and indeed almost need a Sherlock Holmes to find them in some cases.

My attention was drawn to a recent letter by a recently retired Member of another place, Sir Gilbert Longden. He was a much respected Member of another place for many years. He drew attention to the Conservative Party's 1951 manifesto, which declared: The worker should be free to decide whether or not to join a union, and to choose which union he should join. It is vital to the health of the trade union movement that unions should continue to be free associations of free men and women". That was in 1951, 30 years ago. Since then I think that the Conservative Party have been in power for something like two-thirds of the time. It seems a rather damning indictment that, if anything, we seem to have moved backwards and certainly not forwards. No wonder the noble Lord, Lord Harris of High Cross, in his speech last week on the closed shop issue very much blamed the Conservative Benches for failing to put matters right in the 1980 Act.

Perhaps I may refer to last week's valuable debate on the closed shop initiated by the noble Lord, Lord Harris of Greenwich. I am sorry that he is not here today. Nor do I see any members of his party, which is a pity because we should like to know further how they stand on these issues, and whether or not their party is merely a party where socialists hasten slowly or whether it is perhaps something rather more. Few can have listened to that debate without a feeling of great shame that something more really must be done about what is a wholly unacceptable infringement of an individual's liberty.

In my opinion the closed shop is tyrannical, offends the principle of freedom, and seeks to smash an individual's conscience. It is contrary to the practices of many European countries. I quite appreciate that devising legislation allowing people the basic right to join or not join a union is fraught with difficulties, and it is argued with some justification that such measures may merely drive such practices underground. But I find that this smacks somewhat of defeatism. One might just as well argue that laws which make, say, fraud, theft, blackmail or extortion illegal are unenforceable. Of course there will always be abuses, but laws can at least reduce specific evils.

The Earl of Gowrie

My Lords, will my noble friend give way? I am interested in the point he is making. The point of the Government's case on this is that they have practical experience of having legislated the closed shop out of existence, but failing to get any co-operation from both sides of industry on it. It is no good putting legislation on the books, as is easily done with a large majority, if no one will observe that legislation. The moment we have an indication that legislation may be observed we will of course move to put it on the statute book.

Lord Ellenborough

My Lords, I thank my noble friend for that observation, and I appreciate that there is a great deal in what he says. There is perhaps a difficulty, in that, although, as he rightly said in the debate last week, there was not a specific commitment in the Conservative 1979 manifesto to do away with the closed shop, it is rather taking refuge in the small print not to do so, because, although that is true, it is also true that the impression was strongly fostered at the last general election that the Conservative Party were going seriously to tackle this, and indeed other issues. I feel that my noble friend the Minister is rather kidding himself if he does not realise that there is great anger and dismay expressed in many quarters of the electorate that so little has been done.

I should like to make a suggestion and add my support to those—there have indeed been several Questions here and in another place, and articles in the press—advocating that a national referendum might be held as the best way to deal with this difficult issue of the closed shop prior to legislation. In saying that, I am fortified by a recent article in the Financial Times by the well-known journalist, Sam Brittan, whose brother I think is a senior member of the present Government, who wrote: The reform of labour markets is going to be a long job, but the guilt feelings with which Conservative Cabinets approach the unions are a luxury which can no longer be afforded. Not as a complete solution, but as a gesture towards what is required, the Prime Minister should at long last propose the complete abolition of the closed shop, with no ifs and buts. This should be put to the country in a referendum". I fully appreciate that this is the sort of thing which initially will be shot down in flames. I know only too well that referendums are not popular devices in this country. I know that they have been used only sparingly and on strictly constitutional issues such as the membership of the Common Market and devolu- tion. Nevertheless there can hardly be anything more fundamental and vital than the right to obtain and hold a job without being dependent on holding a union card. I very much suspect that people like the wretched Miss Joanna Harris are rather more concerned about getting their jobs back than about membership of the Common Market or devolution.

There has been considerable evidence from several opinion polls indicating substantial majorities in favour of dealing with various aspects of trade union reform such as the closed shop. I believe that a satisfactory outcome of a national referendum—there should not be much difficulty passing the necessary legislation through Parliament to enable a referendum to be held—would be the one thing that could galvanise this Government into grasping the nettle, enabling them to summon up the necessary moral courage and guts to deal with the issue before it is too late. Otherwise I feel the great danger is that the next step, if there be a next step at all, will not be forthcoming this side of a general election. This is an issue which must be tackled seriously if there is to be a true revival of the native genius of the British people.

7.1 p.m.

Lord Houghton of Sowerby

My Lords, we are nearing the end of the debate and I am wondering what the noble Lord, Lord Renton, feels about the response there has been to his Motion. He will be telling us shortly whether he is satisfied with the mixed reception the discussion document has received. I thought the noble Earl, Lord Gowrie, was a little lukewarm in his introduction of the discussion document; he appeared to have little confidence that a fine tuning of the law would do much good and he quickly moved on to the wider issues, which were the important ones, certainly from the Government's point of view.

The message has been delivered and I think the noble Lord, Lord Renton, as noted by his noble friend Lord Gowrie, will be pleased with the distinguished seminar that his Motion has gathered together this afternoon. We have had distinguished speeches from my noble friends Lord Allen of Fallowfield and Lord Scanlon. Three former members of the general council of the TUC have taken part in the debate; there could have been eight but we spared the House the other five. I noticed that my noble friend Lord Greene of Harrow Weald was in attendance for a while, and I am sure noble Lords did not miss seeing the noble and learned Lord, Lord Shawcross, who in the House of Commons in 1946 had the distinction of moving the repeal of the Trade Disputes and Trade Union Act 1927. Altogether, it has been quite a day.

With powerful speeches such as those to which we have listened from noble Lords on both sides of the House, I will not go over the ground again. What a wise man the noble Earl, Lord De La Warr, is. He is much too wise to be sitting on the Benches opposite, if he will allow me to say so. As for the noble Viscount, Lord Rochdale, and the noble Lord, Lord Rochester, the message seemed to come from notable quarters loud and clear that the further prospect of legislation is not welcome. I wish to make one point that has not been touched on in the debate, and that is the desirability of getting, so far as possible, stability in the law. We are in danger of having changes in the law by swing of the political pendulum, and that is bad; uncertainty in the law, with risk of change on a change of Government, is not a good way to run important and contentious matters of this magnitude.

When one looks back at what our parliamentary and political system has produced one wonders what harm it has done. Think of steel: nationalised, denationalised and renationalised all in the space of 16 years. What did that do to our steel industry? I can only ask noble Lords to ponder over that. It took us 16 years to get a final national insurance scheme. Even in the field of trade union law, we had the 1971 Act, which was repealed, then a Labour Government introduced changes in the law in 1974 and again in 1976 in response to the social contract, and the present Government have changed that and have enlarged the scope of the law in the Employment Act 1980. And unless I am mistaken, pledges are already being given that the next Labour Government will repeal the Employment Act 1980. Where are we going if there is never to be a law that lasts more than a Parliament? That is an important consideration. It means that changes in the law in these contentious matters will have to be supported by wide agreement so that decisions arrived at by Parliament will be stable and will last and people will understand that that is the law and we must adjust ourselves to it.

I do not think there is any comfort to be obtained from the news that 1980 had the lowest total of stoppages due to industrial disputes for 39 years. It is gratifying, but it may be due to exceptional conditions in this country. Some of our European competitors are doing better than we are even now, and they are not afflicted to the same extent as we are by depression and unemployment. During the five years 1975 to 1979, Belgium had less than half of our average of working days lost per 1,000 employees in all industries and services; Denmark had only a fraction of our average; France, less than half; Federal Germany, less than one-tenth; Italy was bad, with twice our average; Netherlands, like West Germany, had less than one-tenth; and Sweden had a mere fraction. We have a long way to go before our industrial record becomes as good as that of our European friends.

The discussion document should, in my view, be allowed to fade away in the minds of the public and cease to engage employers and employees, and cease to excite the passions of the lawyers of profits to come, so that we can get on with the real business, which is to attend more to our industrial relations than we are doing at present. We had Bullock and the controversy that followed on both sides. That seemed to die away and nothing has taken its place; nobody is really giving fresh attention to that problem, except to have in certain quarters, like the Institute of Directors, serious anxieties about the proposed Fifth Directive of the European Economic Community.

I see my noble friend Lord Noel-Baker in his place. I want to tell him about what a great variety of Liberal there was. My father was a staunch Gladstonian Liberal, but if he had worked for my noble friend's father, there would have been trouble because my father took the line, "If I am invited to join a union, I will join. If I am told I have to join, I will refuse".

Lord Noel-Baker

My Lords, my father would have invited him to join.

Lord Houghton of Sowerby

Be that as it may, my Lords, my father emigrated eventually to get away from it all, but he came back. Like my noble friend Lord Scanlon, he liked to be back, and when he came back he stayed and lived out his life in this country. My noble friend's father appears to have introduced a closed shop without consultation with the workers, but I will forgive him that; it was a long time ago.

I now wish to turn to a matter which I am sure will not come as a surprise to your Lordships—certainly not to the noble Earl, Lord Gowrie; namely, the present dispute in the Civil Service. We are seeing at present in the Civil Service and in the public sector a serious collapse of the whole structure and foundation of satisfactory relationships between management and staff. The Green Paper says not a word about the special problems of the public service organisations. I ask myself: Is the Civil Service a public service, or is it just another industry? In the discussion paper it is not even given a mention as being an industry.

Are senior inspectors of taxes, who are at present striking, Her Majesty's inspectors of taxes, or are they just another group of white-collar workers? What has moved so many, so high up, to toe the sanctity of the picket line at present? How has all this come about? My noble friend Lord Plant and myself, who in our time were both secretaries of the Inland Revenue Staff Federation, find this development profoundly disturbing. I wonder what has made the Civil Service feel that the only way to justice is through an attempt to coerce the state? Does the Civil Service think that this is a David and Goliath situation, in which valiant people will win the day? When mistaken judgment and actions on the part of Ministers are met by mistaken union leadership, the result is a ghastly error. That is what we have today, and somehow that error must be overcome. There is no sign at present that steps are being taken to achieve that. I am on record in this matter in a letter that I wrote to The Times newspaper on 24th March.

Strikes by public service workers have caused considerable public disquiet and irritation in recent times. This is where the real trouble lies. In most cases there is little or no fear of public service workers losing their jobs, and so they are not restrained by the kind of fear which exists in the minds of many workers in private industry at the present time. Therefore they feel that they can take a firm stand on their jobs and fight for what they believe to be their rights.

A strike of public service workers unavoidably leads to some inconvenience and hardship for the public. In fact one sometimes thinks that that is the main purpose of the strike, because that is the only way to bring pressure to bear on the Government. Public opinion is excited by what is happening and begins to form a judgment on the merits of the strike. If people think that the strike has justice behind it, they will use their influence on MPs to try to get the Government to change their mind. But if the Government are not under that kind of pressure, and if they take a firm stand on the position that they have adopted, how is the deadlock to be ended? It will not be ended by persuasion, but only by negotiation or arbitration.

In the course of this new development in the public sector one sees the vulnerability of the new centres of technology. A similar situation is arising in the private sector, too, in the banks. There are being set up centres of highly concentrated new technology—electronics, computers, and the rest—where a few people can disrupt the whole administration, leaving the others to go to work, and subscribe to a voluntary fund in order to maintain those who are bearing the brunt of the actual strike. That is the position we are in today. In those circumstances there is added a new dimension, a new complexity to industrial action in the public sector. I believe the position to be so serious that the Government should give their full attention to it.

Are the civil servants and other public sector workers to be regarded as being apart from other workers? Are they to have a different place in society, or are they to have conditions of service different from those which apply to workers in private industry? There was a time, in 1927, when a Conservative Government decided that civil servants were a separate and distinct section of the working community. The 1927 Act (the repeal of which in 1946 I have already mentioned) threw all the Civil Service unions out of the TUC, forbad them both to take advantage of the Trade Union Act 1913 and to have political funds. A civil servant had to belong to an approved trade union, which was one exclusively catering for his kith and kin. That is how it was in 1927; and that situation lasted for nearly 20 years, until 1946.

Well, we do not want that kind of thing again. But it was evident that when a Government felt that divided loyalties were dangerous to the community, they did something about it. What about the loyalties of the public services today? We want to get them, to hold them; and the Government should set about doing so. In 1927 the Civil Service was not so much sent to Coventry, as banished to a monastery and denied any contact with its fellow workers.

The fair comparability principle which held the peace of the Civil Service for so long—nearly 25 years—has gone by the board overnight. The noble Lord, Lord Renton, said that he thought that civil servants should forgo the right to strike; they should be under an obligation not to strike. Well, I say to him that a strike of public servants is wholly against Civil Service traditions and is of very recent occurrence. I was secretary of the Inland Revenue Staff Federation for 38 years and there was not a strike during the whole of that period. In the circumstances, it goes without saying that the Civil Service found that it could get by and could secure agreements with Governments without having to consider the possibility of strike action.

It took a Royal Commission—10 years after 1926—to get the fair comparability system which has done so much to keep the peace in the Civil Service. If the civil servant is to be under an obligation not to strike, he will want that obligation matched by one from the other side. He will want an obligation on the part of Government relating to stability of conditions of service as well as an agreeable basis on which pay can be adjusted from time to time by reference to suitable criteria, which will enable fair wages to be fixed.

After all, Members of another place do not want to go on strike, so they are at present busily seeking an acceptable criteria by reference to which their pay can be fixed. So there is nothing new in what the Civil Service is trying to secure. Members of Parliament are busily trying to get it themselves, and in the circumstances it is the Government's duty very quickly indeed to replace the formula, the principles, upon which Civil Service pay has been fixed ever since the Priestley recommendations of 1955.

I say in conclusion that the spectacle of civil servants on strike and on the march is to me deeply distressing, and I am sure that that goes for my noble friends Lord Crook and Lord Plant, who were with me in building up a proud edifice of mutual confidence and relationship between Government, management, and staffs over many years. We want to see the Civil Service once more occupy a proud place in our public life. It does civil servants harm to call them parasites and bureaucrats. It is necessary to have regard for the fact that civil servants are discharging duties laid on them by Parliament. Such duties are not always popular, and they call for considerable expertise. Very often they are complex, and the public are baffled by them. That is not the fault of those whose job it is to administer the law.

Can we therefore look forward to action by the Government? I know I ought to be addressing the Lord President of the Council, but the noble Earl, Lord Gowrie, is here, and I hope he will convey this message to his noble friend. It distresses me to see civil servants behaving as if they were the rejects of society. They are not that, and they ought not to be. Those who got them into this state I think should regard it as a matter of urgent obligation to get them out of it as quickly as possible. At least the Government can produce the new principles. They ought to have cobbled them together by now, instead of destroying them overnight and having nothing to offer the Civil Service to put in their place. To have nothing on offer even now is, I think, a serious mistake on the part of the Government. This is of pressing urgency, and I say to the Government that those who created the deadlock ought to move urgently to end it.

8.1 p.m.

Lord Underhill

My Lords, may I first offer an apology to the noble Lord, Lord Renton, to my noble friend Lord McCarthy and to the noble Lord, Lord Rochester, for not being here for their speeches, but, as I think your Lordships know, I am one of those engaged on this long-running saga, the Select Committee on Docklands. I do apologise, but I shall of course read in the Official Report what they have said. I was fortunate, however, to be in time to hear the noble Lord, Lord Rochester, emphasise quite strongly that the experiences of recent years are such that we cannot contemplate the possibility of introducing even further legal sanctions into industrial relations.

The noble Earl, Lord Gowrie, is always interesting, if I may say so—an able Minister who has a progressive touch. He was certainly enthusiastic about the document, but as my noble friend Lord Houghton has said, I think, he, too, could hardly be said to be enthusiastic about the introduction of further legal sanctions into industrial relations. I, too, should like to thank the noble Lord, Lord Renton, first, for initiating this debate and, secondly, as has been commented on by my noble friend Lord Houghton, for bringing into our debate the authentic voice of the trade unions in the form of three former general secretaries and former members of the General Council of the TUC. I hope your Lordships were impressed by these vicious ogres, the leaders of the trade union movement!

I think it is useful to have the various points set out in this Green Paper. In many sections they set out the pros and cons; but, surely, in a Green Paper of this kind the Government should have given some indication as to the direction in which they were leaning.

A noble Lord: This is a Green Paper.

Lord Underhill

My Lords, I have read many consultation documents in which one could see quite clearly which way the Government were leaning, but we may hear more about that. It may be, of course, that the real purpose of the Paper is to cover over differences that there may be between the "doves" and the "hawks" among the present Ministers. I certainly hope that its purpose was not to soften up the public in a beguiling way to prepare them for the introduction of further drastic legal measures into our trade union law. I cannot understand why, once again, so soon after the 1980 Act, we have sections dealing with secondary action, secret ballots, picketing, the closed shop and union membership. It was not my intention to refer to those at all, because they were so fully debated during our long sessions on the 1980 Bill.

But in view of the words which were spoken by the noble Lord, Lord Spens, in a very nice gentle way, when he said that he would like to stop all secondary action, I hope noble Lords will read in the Officia Report tomorrow the words of my noble friend Lord Scanlon, who emphasised that if this became law every dispute would be bound to be lost if it was of any importance, because this would give a free hand to employers to use their own secondary action to break the strikes. Under no circumstances, I hope, will the Government listen to beguiling words on the lines of those spoken by the noble Lord, Lord Spens. But I question why we should have these issues reopened in this Green Paper so soon after they were fully debated in the discussions on the 1980 Bill.

Of course, everyone would like to see greatly improved industrial relations. We should like to see the very minimum of strikes; but may I say, with respect, that just making what may appear to be popular-sounding speeches does not solve the situation at all. We have got to deal with the real world in which we are living. There seems to be a thread running through the Green Paper indicating that our industrial decline can to a substantial extent be placed at the door of the trade unions. That is a thread that I seem to see in the document. That, my Lords, is far too facile; but obviously one cannot deal with that fully in a short speech.

Another thread in the document is that the unions have too much power and too little responsibility. I hope noble Lords will have taken to heart what my noble friend Lord Allen of Fallowfield said in a very temperate speech, in which he warned that there are persons in the Government who would like to see action taken which could lead, frankly, to weakening and breaking the trade unions. I hope noble Lords will take to heart those words from the noble Lord, Lord Allen.

The document skates over the ever-increasing power of the multinationals, which have considerable effect upon industrial relations. We must not overlook the power of industrial concerns arbitrarily to declare redundancies or close particular plants, sometimes with little or no consultation with the workers. Yet we hear a lot about the monopoly power of the unions; and I was glad that my noble friend Lady Gaitskell intervened on that point. We can sit here and calmly talk, in the words of the noble Earl, Lord Gowrie, about the "shake-out". The "shake-out" means workers being thrown on the scrap-heap; it means redundancies; it means people who may have to wait years before they can find other employment.

Reading yesterday's press, I saw the account of 240 women and 10 men at Greenock who are resisting the closure of their American-owned jeans factory, where it is quite clear from the machinists' records that there has been increased productivity over the last year, in the case of many machinists, of over 50 per cent. These men and women have asked that independent accountants should be able to look at the books, and if they are satisfied that this factory must close because of its financial position then they will call off their sit-in. That request has been refused. That, my Lords, is a typical example of what working people want. They want to be taken into consultation. They should be able to see the finances of the concerns which affect their lives; and there should not be this possibility of arbitrarily closing down—and then we, sitting in the comfort of your Lordships' House, just refer to it as a "shake-out". It is something far more drastic than a "shake-out" when we are dealing with human beings.

In fairness, I must refer to paragraph 24 of the Green Paper, which says: Above all, employers have shown too little willingness to involve employees and their representatives in policies and decisions which affect their working lives". That is an aspect in this document on which I hope we shall concentrate in the future, because it is one of the most important moves towards improving industrial relations, that workpeople are taken into the fullest consultation.

The noble Earl, Lord Gowrie, painted two pictures of trade unions. I shall look with great interest at his closing speech for him to give two pictures of employers—because we could do that if he himself cannot. There are always two sides to such a question. The Green Paper refers repeatedly to changed conditions, but it fails to concentrate on this aspect of the workers' desire to be involved in their future.

Incidentally, the document does not refer to changed conditions where, in some major concerns, mass strikes are no longer necessary because today merely a small number of workers in the computer section of a big firm could draw the whole firm to a close. This is an aspect which must be taken into consideration when we are talking about industrial relations. There are many references in the document to the Donovan Commission and the emphasis that is placed upon the voluntary nature of our industrial relations. It is stated that this is unique in the world. Because it is unique is no reason why we should change it, as some have suggested. I would say that possibly our parliamentary system is unique in the world; but I hope that no one is suggesting that we change it. It is also stressed in paragraph 11 which sets out Donovan in full on this principle. The paragraph ends: In short, it has been the traditional policy of the law as far as possible not to intervene in the system of industrial relations. If this debate has shown one thing, it has shown that noble Lords from all sides of the House believe that, so far as possible, that principle should be followed. I hope that the Government will take serious note of that.

Your Lordships having heard the voice of ex-general secretaries and members of the TUC General Council, I speak as a rank and file trade unionist with 50 years' membership. I was brought up on two judgments of the House of Lords, the Taff Vale judgment in 1901 which concerned damages which were given against a union for damages by a strike to a particular undertaking. That led the unions to consider that political action was necessary in order to change the law. Eventually, we had the 1906 Trade Disputes Act. The other judgment was the Osbourne judgment of 1908 that a union could not spend money on political activities. That led to the 1913 Act which laid down that a ballot is required, a special political fund, and rules and the necessity for contracting out. I mention that because the noble Earl, Lord Gowrie, said challengingly to the Opposition; "Who would put their hands on their heart and say that the relationship of the trade unions with the Labour Party is to their mutual advantage?" I will—and I am certain that most of my colleagues behind me will do so also. I would remind the House of the words of my noble friend Lord Scanlon: that people tend to be a little cynical about the relationship of the trade unions with the Labour Government; and they refer to the social contract. Unfortunately, things ended in disaster, but during the period when the social contract was functioning it was not just to the credit of the Labour Party and the trade unions but to the great benefit of this country. I am hoping that we shall go back to that situation—and we shall do so with a Labour Government and there will be another form of social contract with the trade unions—and we shall hear more of that before we get near the general election.

The noble Earl, Lord Gowrie, also said that labour costs are too high and tended to repeat the view point in the document that much of our present troubles are due to this. Surely, this question must have some relationship to the fact that our investment is too low; the fact that when we are looking at our competitors most of them have each worker backed by far greater investment than in this country. That is something which I must mention. Incidentally, one would think when listening to some of the comments that this industrial recession just happened—that it was not due to any actions of the Government but just came upon us. That is something we may hear more of in the economic debate next week.

Chapter 2 of the document is very useful in setting out an account of the history and development of trade union immunities. I have referred already to the 1906 Act, which arose out of the Taff Vale judgment. Paragraph 55 of the Green Paper states that this Act, the 1906 Act: established the basis of the present immunity from action in tort for acts done in contemplation or furtherance of a trade dispute. It was in two main parts". I am not one of those who is a traditionalist but for 75 years this has been the law on trade union immunity. Why at this stage in our history is it now considered that we should change? It is the question of immunities that is the key point of the Green Paper and the key point in the Motion moved by the noble Lord, Lord Renton.

The document points out in paragraph 125 that some 90 per cent. of strikes are unofficial. That places the union outside legal action for those disputes. I think those who have been connected with union activity will say that an unofficial strike, usually a very short matter of one day or less, is often a safety valve for other greater troubles—not that I advocate official or unofficial strikes. The document suggests that if union funds were to be placed at risk by possible legal action, the unions might become more authoritarian and tighten their rule books. That suggestion is absolutely unreal. I am not claiming that all unions are perfect and I do not suppose that anybody will claim that all the employers' organisations are perfect; but at the end of the day no rule book can stop a body of workers downing tools if they feel they must do so. I hope the situation does not arise; but if workers feel the situation requires them to down tools, nothing can stop them. You can put thousands in prison, bring armed action against them! But that is unreal in Great Britain and nobody would suggest that it was possible. We must keep in mind that if union funds were to be put at risk, there might be a greater tendency for unofficial strikes.

I was pleased that the noble Earl referred to paragraph 122. I am not going to read it at length but shall merely say that this suggests that any change on immunity could throw a very great onus on the courts. The paragraph pointed out certain conclusions and made the statement that: given this uncertainty, it is unlikely that the courts would hold that trade unions were responsible in some—perhaps many—cases of unlawful, unofficial, industrial action". That should be taken into account. Any change on immunity would create bitterness that instead of helping industrial relations, would harm them. One has only to remember what my noble friend Lord Scanlon said about the effect on the AUEW as a result of the previous law.

I should like to see some union reorganisation, but that cannot be determined by law. You cannot set aside the history of development of trade unions in this country. We have not had to have the situation of starting completely anew, as was the position in West Germany. I would remind the House of the statement made by my noble friend Lord Allen of Fallowfield when he quoted paragraph 19. I shall quote only the first few words: But good industrial relations cannot simply be legislated into existence. Reform must come from within: from trade unions and employers". This, I believe, is the thread which should be running throughout our discussion of this question of industrial relations. I hope that this will be the view of all noble Lords.

I conclude by referring to the remarks of the noble Lord, Lord Hankey. He said that he was astounded at the complacency in many speeches. I do not believe that there was an atmosphere of complacency in most of the speeches of noble Lords who took part in the debate. Certainly, there must not be complacency. Neither must there be any panic measures; nor, as was warned by my noble friend Lord Allen in his temperate speech, must the present economic position be used in order to weaken the situation of the trade unions. I am heartened by many of the speeches in this debate. Many are genuinely seeking to get a basis for good industrial relations. I am particularly heartened by many noble Lords who have said quite clearly that the way to good industrial relations is not to go further on the path of bringing more law into those relations.

8.20 p.m.

The Earl of Gowrie

My Lords, the noble Lord, Lord Underhill, dealt very fairly with me and I do not want to take up too many points of his admirable winding-up speech. However, if he will cast his mind back over the contributions that I have made to economic debates in your Lordships' House, he will find that on balance I have been more critical of employers on the whole than of unions. It seems to me logical for unions to make the best case that they can for the terms and conditions for their members. That is, after all, a major function of their whole existence—perhaps the major function. However, employers have to pay wages and meet wage claims with regard to productivity, and are faced with the need to retain profits for investment and to provide some rate of return to investors. It is a prerequisite—and many noble Lords have said this in this good debate—that employers should communicate this fact constantly to their workforces. It is no good employers looking to the law to protect them from the consequences of their actions if they grant inflationary wage claims which do not have regard to productivity and the need to reinvest.

I can congratulate my noble friend Lord Renton upon attracting a very temperate debate and not a boring one. Normally temperateness and dullness can go—alas!—hand in hand. I found it of great interest. My right honourable friend the Secretary of State, who has a strong personal investment, as it were, in this approach and in the document, will certainly read everything with great care. I can say to my noble friend Lord Mottistone that I do not altogether feel like a curate at this point rising to defend my egg. Some noble Lords confuse White with Green Papers. This present document came into being because we promised in the debates on the Employment Act that our view—and this was a view shared, as the noble Lord, Lord McCarthy, will bear witness, by the noble Lord, Lord Wedderburn of Charlton, of all people—was that a system based on immunities rather than rights was not necessarily the best of all systems and the most perfect of all worlds—We did not take that Panglossian line—and therefore we said we would introduce a discussion document for the whole economy to see whether one might not proceed down the road of rights rather than immunities.

Lord McCarthy

My Lords, I can assure the noble Earl that the noble Lord, Lord Wedderburn, is in no sense and in no way in favour of a positive rights system.

The Earl of Gowrie

My Lords, that is not the inference that I was trying to make. The noble Lord, Lord Wedderburn, said—and I remember the incident very clearly—that it was a curious and eccentric historic circumstance that union rights in this country had grown up on the basis of immunities. That is not to say that the noble Lord, Lord Wedderburn, wished to change it but he recognised it as eccentric. Therefore, in response to that, and in response to other representations, we thought that there was something to be said for airing this publicly and consulting on it. This is what we have done.

My noble friend Lord Renton—I am sure it was not his intention—gave what I found to be a slightly misleading impression in one part of his speech. This was echoed by the noble Lord, Lord Spens. It was that, despite our Employment Act, secondary picketing was still lawful. I should like to make it very clear that the only picketing which retains immunity under the Employment Act—and there is an exception for trade union officials accompanying their members—is picketing at one's own place of work. As the Green Paper points out, this leaves scope for those who are taking lawful secondary action to picket at their own place of work. This kind of picketing is not usually what is meant by "secondary picketing" and in any case it is extremely rare. No one should be in any doubt that secondary picketing in the generally understood sense of the word is, as a result of the Employment Act, now unlawful.

Lord Renton

My Lords, I think I can ease my noble friend's mind and it will be further eased when he reads my speech tomorrow. What I said was entirely in accordance with what is written in paragraph 166. That makes it quite clear that there must be a trade dispute, that picketing must be carried out by a person at or near his own place of work and it must be peaceful.

The Earl of Gowrie

My Lords, I am most grateful to know that my noble friend and I are in line about that after all. The noble Lord, Lord McCarthy—and he was echoed in a powerful speech by the noble Lord, Lord Houghton—raised the issue of overturning for economic reasons long-standing pay systems existing in the public sector. I see this issue and I have considerable sympathy with the reactions to it. It is a feature of all industrial agreements that either party, whether employer or employee, may seek to renegotiate the machinery for determining pay and conditions, and negotiations about the nature of the machinery are sometimes as important as negotiations about the amount of pay itself.

I should like to make it clear that in the case of the Civil Service agreement the suspension of pay research and the decision to have a review to establish a new and orderly agreed system of pay determination is something which it is perfectly proper and reasonable for any Government to seek. Moreover, the fact that pay research has been suspended so often in the past—including suspension by Governments led by the party opposite—supports our view that it may be out of date and that it no longer commands sufficient general confidence.

I shall, however, relay the speeches of both noble Lords as a matter of urgency to my noble friend the Lord President. We are very distressed at this dispute in the Civil Service. I welcome this opportunity to indicate the competence of civil servants that I have always found in 10 years in and out of Government. It is a great shame in this country that the system which the noble Lord presided over with such distinction for so long has broken down. However, it has broken down less through the malevolence of Governments of one kind of political party or another than through the stresses and strains imposed on this economy by inflation.

The noble Lord, Lord Rochester, made an interesting speech. He is to some degree the villain of our piece. He was the sole speaker from the Liberal party and it was the Liberal party which was the begetter of the 1906 immunities which have caused us all such heart searching. He asked me about no-strike areas, and a number of noble Lords echoed him. Strikes are effectively unlawful, as he pointed out, in the police and armed forces and, where seamen are concerned, when they are at sea. These have long been special cases. There are no areas with no-strike agreements in which unions give up the right to strike for promises on methods of settling pay. It may be that that is a road down which this economy should travel. If the Green Paper has opened up that area of debate, I welcome it.

Lord Rochester

My Lords, it is only a small point but I had hoped that I had made it plain—and perhaps the noble Earl will read my speech tomorrow—that all experience has shown that except in the armed forces and the police it was not feasible to have a situation where people were not entitled to withdraw their labour. What I had to say in relation to other parts of the public service key occupations was that I thought there was a strong case for having some system of arbitration by a body largely independent, and that that might provide a way through.

The Earl of Gowrie

I take the noble Lord's point. The noble Lord, Lord Rochester, also raised issues about the voluntary development of legally enforceable procedure agreements. The noble Lord, Lord Hankey, echoed him there. As the Green Paper makes clear, we believe that there is scope for expansion here and the Green Paper recognises the crucial importance of improving the provisions of procedure agreements and making them clearer and more comprehensive. That is a pretty big task but the noble Lord's proposal of a code of practice to encourage this process is very interesting and it is one to which I will give most serious consideration.

The noble Lord, Lord Rochester, and my noble friend Lord De La Warr, in a spectacularly excellent speech, if I may say so, also dealt with participation and communication. I mentioned that at the beginning of my speech in talking to the speech of the noble Lord, Lord Underhill. The Government are prepared to take the lead in encouraging employers to communicate with their employees and to involve them in decision-making. But we do not think that the rigid straitjacket legislation associated, perhaps unfairly but I think popularly, with the Bullock Report is the right way to go. It is difficult to find a legislative formula which will fit the varying requirements of different industries. Indeed, I think that that is really a moral for legislation in this field generally. The field of industrial relations is a very plural one and it is hard to tailor laws so as to cover every kind of case.

I agree with the noble Lord, Lord Underhill, that we had an excellent speech from the noble Lord, Lord Allen. He called for a meaningful and constructive dialogue with the unions by Government. Of course this goes on through the NEDC machinery, and I very much welcome that. The TUC have made very clear their view that the Government should borrow more money and we have made very clear our view that we do not think that that is compatible with lower interest rates, which the unions would also like. But of course the dialogue goes on. I certainly agree with the noble Lord that there must be, even more importantly, meaningful and constructive dialogue between the unions and the employers.

The noble Lord, Lord Hankey, echoed by my noble friend Lord Ellenborough and to some degree by my noble friend Lord Ferrier, really made a political point. He said the Government had a clear mandate for radical reforms but have made only small reforms, and he hoped for more extensive reforms in this field. I think that two things are pertinent here. One is that if the Conservative Party manifesto of 1979 is studied carefully—I do not think it is a "fine print" issue—what we intended to do was made very clear and what we have delivered has been very clear. If we had intended differently, my right honourable friend the Secretary of State would not be in his present job and he would not have put the law that he did on the books. But perhaps a point of more general interest is the danger of falling into an electoral trap. It is most important that policies in this field should stick, and I must ask the noble Lord, Lord Underhill—rhetorically at this late stage of the debate—will Labour seriously campaign against my right honourable friend's legislation? In my view—and it seemed to some degree to be the tacit view of the noble Lord, Lord Houghton, with all his experience—whatever the politics of the next few years are, this legislation looks like sticking, and it is exactly designed to do that.

I have already mentioned the most constructive and helpful speech of my noble friend Lord De La Warr. I certainly undertake to look at the three things that he mentioned and I would remind the House of an admirable phrase of his, warning us against saddling both unions and managers with laws they do not want and which cannot in fact be enforced.

Like everyone in the House, I particularly enjoyed the speech of the noble Lord, Lord Scanlon. We recently spent many days on the Wildlife and Countryside Bill, and in the context of that Bill it is nice to think that the House is still full of poachers who have become gamekeepers! I wish I had the good fortunate to belong to the sixth forms who benefit from the wit and wisdom of the noble Lord, Lord Scanlon, and I hope that when he next goes on tour he will have a few kind things to say about this Green Paper. I was also encouraged to notice that the noble Lord made a plea for no further legislation, in a tone which suggested to me that he too tacitly supports the legislation which is already on the books. The noble Lord's jokes, I think, were matched only by one made by my noble friend Lord Cottesloe in which he meditated about the fact that diplomatic immunities in the field of parking tickets were causing us almost as much trouble as labour relations immunities.

The noble Lord, Lord Harris of High Cross, pointed out—and it is a point which I have made many times, perhaps less pithily, myself—that the monopoly powers of unions in certain fields have not really been in the best interests of their members if we compare the record of overseas countries. I certainly endorse that. I am glad that my noble friend Lord Rochdale, with his experience of industry and of the great region of Cumbria, endorses the present legislation, given goodwill, as he said. Of course he warned that were there not to be goodwill and were the legislation not to be applied there would be further legislation, and I would agree with that.

The noble Lord, Lord Noel-Baker, treated us to some delightful pieces of family history, which is very appropriate in a House like your Lordships' House. The message that I got out of his speech was: "Closed shop, pro; class, anti ". I have some qualifications about the first, but very few about the second sentiment.

The only speech at which my heart sank was that of my noble friend Lord Mottistone, who asked for a further consultative document. Having been involved in all the processes of making this present one, my heart sank at the thought of going down that road again. The noble Lord, Lord Davies of Leek, said that the impression given of trade unions in the Green Paper was of a lot of yobbos running round and crying, "More !" That does not sound to me at all like my right honourable friend, and I see a lot of him. As to strikes, as the noble Lord, Lord Houghton, pointed out, we are in a very "low strike" position at the moment, and long may that continue.

The noble Lord, Lord Spens, said that the public were being abused. He and I crossed swords about this issue throughout the Employment Act debates. I know I did not convince him then and we had some particularly splendid and interesting debates. I do think the onus is on him to give the Employment Act the benefit of the doubt for a little while longer. The Government have never hesitated to say they would be prepared for additional legislation if that Act does not look like sticking.

My noble friend Lord Ellenborough made suggestions about referenda where closed shops are concerned. I am well aware that many agree with the Government in their opposition to the closed shop; we had a good debate on this last week. When my right honourable friend the Prime Minister was asked about a referendum on the issue in another place recently, she suggested that all those with experience of closed shops should make their views known to us at the Department of Employment, and of course I hope people will take up her suggestion.

As I pointed out to my noble friend Lord Ellenborough, the problem is that in a field as plural as industrial relations you need fundamentally the consent of employers if you are to operate effective laws against the closed shop. It may be that the climate has changed and that consent will be coming, but unfortunately when we consulted on this document we did not find that it would be likely to come.

The noble Lord, Lord Underhill, in closing, asked me again a rhetorical question: why were we bringing forward this paper at this time? If noble Lords, in an idle moment, look at the appendix on page 99 desscribing the industrial relations system of the Federal Republic of Germany they will see the answer, because this system was designed by a great trade unionist—Mr. Ernest Bevin—and he designed it in the full knowledge that, whatever the rights and wrongs of the British industrial relations system, it was not a perfect one and that if one had a chance to operate on a green field site, so to speak, which he found in 1945, he would do things differently.

In my view, sooner or later we are going to have to do things differently. In the meantime, at the heart of the Government's industrial policy is the remark I made in my opening speech, that in a free society the only sensible thing to do is to face people with the consequences of their own actions and not to seek to protect them from those consequences. Nine times out of 10 in those cases they will act responsibly. I am glad to be able to say there is increasing evidence that that is what is going on at the moment but I do not believe any of us thinks that the industrial relations legal system is perfect. I think on the whole that most people have welcomed the document as a chance to see whether there are serious alternatives and ways of proceeding that we might adopt.

8.40 p.m.

Lord Renton

My Lords, I should like to thank all of your Lordships who have spoken in this most interesting and constructive debate. It has also been, in spite of the controversial nature of the issues which we have been discussing, a warmly good-humoured debate. I should like to thank my noble friend Lord Gowrie for the two very constructive speeches he has made, showing, as always, a wonderful command. We have also had two very clearly stated views from the Opposition Front Bench, with the noble Lord, Lord Rochester, coming somewhat in between.

Whatever our differences, we have all had one motive in this debate, which is to try to find some way of improving our industrial relations for the benefit of our economy and of the country. Great eloquence has been displayed by representatives both of trade unions and of employers' organisations, if I may so describe them, in order to try to establish that there should be no more legislation because, as they say, the law has no part to play. That is about the most ironical conception that could be put forward.

Surely, as the Green Paper shows in paragraph 12, one of the troubles about our legislation is that the law has played too great a part and not a well-balanced part. I shall not repeat what I said earlier, but I would refer noble Lords once more to paragraph 12 of the Green Paper. So I find that ironical, more especially as the modest proposals that I made with regard to altering immunities consist mainly of repealing part of the law relating to immunities. It is these immunities which, as the Green Paper said, have given too much power and imposed too few obligations so far as the unions are concerned.

Like other noble Lords on both sides, I, too, support the step by step approach, but I cannot accept that the 1980 Act should be regarded as the only step. I was thankful to hear my noble friend Lord Gowrie indicate in his last speech that it might not be. I agree that industrial relations cannot be improved entirely by law, but they can be harmed by law and that is what we want to prevent. I wish that I could share the confidence of those on both sides of industry who have confidence in their ability to put things right, without any more legislation to rectify the present chaos.

Every time it has been suggested by Governments, since the early 1960s, as we well remember, that the trade unions should voluntarily put their house in order, they have been told: "Leave it to us ", but nothing further has happened. The Labour Government did, as Mr. Scanlon in his most entertaining speech—I should, of course, have said "the noble Lord, Lord Scanlon ". He will forgive an old habit—I must have mentioned him in that other phrase so often on public platforms. But he mentioned that the Labour Government legislated to strengthen trade union powers even more, and he painted a rosy picture of what happened under the social contract.

But in that picture, he did not reveal the climax of the whole process, which was the winter of discontent! Scarcely anything has been said in the debate, which I find a little surprising, about the way in which the present law plays into the hands of extremists. Not very much has been said about the Civil Service, except in the most interesting and powerful speech of the noble Lord, Lord Houghton. I was very relieved to hear him say—if I understood him rightly—that there is no real place for the closed shop so far as the Civil Service is concerned.

In conclusion, may I just say this: If there is no next step by way of legislation in this Parliament, a number of your Lordships on both sides will be content. But millions of our countrymen outside this House, including many members of trade unions, will be deeply disappointed. It will be no comfort to them to take note of the fact that the recession, and the unemployment which it has caused, has made for better labour relations. They want the position fundamentally put right. If, in the long run, this debate has contributed in any way to a better solution, then, indeed, we can all be thankful. My Lords, I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.