Lords Sitting of 22 December 1982

Preamble
The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Reverend the Lord Sandford.

Royal Assent
The Lord Chancellor (Lord Hailsham of Saint Marylebone): My Lords, I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts:

Commonwealth Development Corporation Act,

National Insurance Surcharge Act,

Electricity (Financial Provisions) (Scotland) Act,

Lands Valuation Amendment (Scotland) Act,

Writers to the Signet Dependants' Annuity Fund Order Confirmation Act,

Highland Region (Banavie Level Crossing) Order Confirmation Act,

Lerwick Harbour Order Confirmation Act,

Western Isles Islands Council (Omnibus Services) Order Confirmation Act.

European Assembly Elections: Postal Vote
11.6 a.m.
Lord Harris of Greenwich: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government when they propose to introduce legislation to give a postal vote to United Kingdom citizens residing in other European Community countries for elections to the European Assembly.
The Parliamentary Under-Secretary of State, Home Office (Lord Elton): My Lords, the Council of Ministers of the European Community is currently considering the European Parliament's proposals for a uniform electoral system under which nationals of member states would be able to vote in elections to the Parliament, irrespective of their place of residence in the Community. The Government do not propose to introduce legislation, changing the franchise at European Parliament elections, before the council has reached agreement on this issue. It is still not clear when this will happen.
Lord Harris of Greenwich: My Lords, in thanking the Minister for that reply, may I ask whether it means that if in fact the Council of Ministers does not reach
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agreement in good time for the next European Assembly election, up to 300,000 British citizens will be disfranchised at the election?
Lord Elton: My Lords, since they are not now enfranchised, they will not be disfranchised. But in answer to the substance of the noble Lord's supplementary question, I would say that we would not intend to legislate before agreement is reached.
Baroness White: My Lords, is the noble Lord not aware that six of our fellow member states in the European Community have been able to make arrangements for their citizens living in other parts of the Community to vote? Why should British citizens be at such a great civic disadvantage? Cannot the Government find a way, even if subsequent legislation might have to modify it, to enable these persons to vote in the forthcoming election, in 1984?
Lord Elton: My Lords, as I have been at pains to explain, it is not our intention to legislate ahead of agreement reached in the Council of Ministers on this matter. To do so would in the end prove nugatory.
Baroness White: But, my Lords, six other member states have not waited for the council; they took action several years ago.
Lord Elton: My Lords, the variety of provisions within Europe is considerable. Different countries have different arrangements, and the question is: Which is the best arrangement? It is the best arrangement to which we wish to subscribe. That will be the arrangement that is agreed by the Council of Ministers.
Lord Underhill: My Lords, may I ask the Minister whether there are not three important considerations that must be kept in mind? First, the proposal in the Question of the noble Lord, Lord Harris of Greenwich, for absent voting, extends facilities for persons overseas far beyond those given to British citizens overseas for parliamentary elections. Secondly, if there is to be no national list system, would not the question of allocation to a parliamentary constituency be a very important matter in registration? Thirdly, if there was to be registration in a constituency, should there be a maximum period for overseas residents beyond which they would not qualify? Otherwise, persons who had been away for 30 or 40 years could qualify in a European constituency in this country.
Lord Elton: My Lords, the noble Lord is quite right; there are many important and difficult considerations, all of which are at present with the European Council and which Her Majesty's Government will have to consider when the matter comes to us.
Lord Paget of Northampton: My Lords, can the noble Lord give us an assurance that nothing will be done to increase the already gross expenses to which we are put to elect this absurd assembly?
Lord Elton: My Lords, I would not join the noble Lord in any such description of the assembly, but I would endorse the point that Her Majesty's Government are always sensitive to issues of economy.
Lord Harris of Greenwich: My Lords, may I ask the noble Lord what has changed since his honourable and right honourable friends in another place tried to amend the Act relating to the European Assembly, when they advocated precisely the change that I am suggesting in this Question? Secondly, may I ask the noble Lord whether he is aware of a sense of burning injustice felt by many hundreds of thousands of our fellow citizens who are not getting the vote in these elections? Could not the noble Lord at least ask his right honourable friend the Home Secretary to pass on the views of these people? As I have indicated, they do not understand why, when in many cases they are doing urgent work, promoting British trade, they do not get the vote in these elections.
Lord Elton: My Lords, as to the sense of burning injustice, my right honourable friend is aware of all the representations that have been made, and I shall draw his attention to the representation that the noble Lord has made. As for the rest of the noble Lord's supplementary question, I can only revert to my original Answer: that it is our view that it would be untimely to legislate in advance of a decision that might render entirely out of context and improper the legislation that we passed.

Nuclear Disarmament Negotiations
11.11 a.m.
Earl Alexander of Tunis: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether, in view of the new Soviet leader Mr. Andropov's reported comment,
"Let no one expect unilateral disarmament from us, we are not a naive people".
they will make a Statement on East/West disarmament negotiations.
The Minister of State, Foreign and Commonwealth Office (Lord Belstead): My Lords, it has long been the British Government's view that unilateral, or onesided, disarmament would be naive in the extreme. The route to successful arms control is through multilateral negotiations, the objective of which is to preserve or, if possible, enhance our security through balanced and verifiable reductions of armaments on both sides. To this end we support the allied position in the talks on conventional forces in Vienna, and the two negotiations in Geneva on intermediate range and strategic nuclear weapons, at which the United States have, with allied support, proposed radical cuts in the levels of nuclear weapons. We should like to see the Soviet Union respond constructively to these proposals.
Earl Alexander of Tunis: My Lords, while I thank my noble friend for his reply, would he not agree that those in this country who campaign for unilateral disarmament, show a dangerous lack of judgment? Should not Her Majesty's Government do more to persuade the British public that there can be peace only through strength, and that the siting of cruise missiles in this country, for example, demonstrates our resolve to protect ourselves?
Lord Belstead: My Lords, I agree with my noble friend's assessment and also I agree with my noble friend that, provided we remain firm in the intentions which we have stated, that is the way that we will be most likely to get an arms control agreement which is both balanced and verifiable.
Lord Brockway: My Lords, is it not possible for the Government to adopt a more negotiating attitude? Is it the case that Mr. Andropov yesterday offered to reduce by more than two-thirds the medium missiles in Europe; and does this not follow an offer to cut the SS2s by 20, to withdraw missiles from central Europe and to propose that nuclear weapons should not be used first? In view of all these offers, rather than mere rejection, is it not possible to take negotiations when they are made?
Lord Belstead: My Lords, the Andropov offer is bogus. It endeavours to equate intermediate-range land-based nuclear missiles (which only the Russians hold) targeted at every single country in Western Europe with strategic weapons which both France and the United Kingdom hold. That is not equating like with like. If, for the first time, the Russians now accept the principle that their SS20s must be reduced before there can be greater security, that, I would agree with the noble Lord, is a step in the right direction. But to demand a substantial and continuing Soviet monopoly of longer-range, land-based missiles in Europe while insisting that NATO alone should implement the zero option, is not a serious negotiating position.
Lord Nugent of Guildford: My Lords, while any offer to reduce Russian arms is welcome, can my noble friend confirm the impression that the Russian offer would have the effect of reducing their medium-range missiles to some extent but of removing ours altogether?
Lord Belstead: My Lords, perhaps, for the record, the way I should reply is that my understanding is that Mr. Andropov's offer would be to remove all the old Russian SS4s and SS5s and to reduce the very modern SS20 Russian rockets to the equivalents of the British and French independent strategic missile forces, while allowing no deployment at all of the American intermediate-range cruise and Pershing missiles. My understanding of that, as a conclusion, is it would mean that there would therefore be a monopoly—and I am agreeing with my noble friend—of Russian intermediate-range weapons in Europe still targeted upon every single country in Western Europe.
Lord Hale: My Lords, may I ask the noble Lord whether he really is answering the Question on the Order Paper or is he referring to a later Statement which is not on the Order Paper; and can he add whether the Question on the Order Paper refers to a statement made, or alleged by the Daily Express or Pravda, to have been made by Mr. Andropov, in Russian or in English, and to what extent we may henceforward put down on the Order Paper observations of persons of almost any nationality?
Lord Belstead: My Lords, the supplementary question which the noble Lord, Lord Brockway, asked me about Mr. Andropov's offer, arises from one of the disarmament negotiations which are going on at the moment between East and West—which is what the original Question was about.
The Earl of Kimberley: My Lords, would my noble friend not agree that the time has come to regard some of the organisers of the so-called Peace Movements as being openly hostile to our own country as well as to the whole of the Western Alliance?
Lord Belstead: My Lords, I think that all your Lordships would well understand the distaste, indeed the dismay, of many people at the thought of nuclear war; but, in Her Majesty's Government's view and in the view of the Western Alliance, it is only by steadiness and determination that we shall reach the goal of an agreed, balanced and verifiable disarmament.
Lord Taylor of Gryfe: My Lords, has the noble Lord read the interesting article in today's Financial Times on the offer by Mr. Andropov, an article which concludes that, although the detail of the offer is contentious and the bargaining road ahead is hard, at least both sides are talking the same language? Does this not encourage the noble Lord to take a more positive attitude to keep the dialogue going on this important subject—particularly at Christmas?
Lord Belstead: My Lords, certainly it is the intention of the West to see that the dialogue is kept going in the INF and at the START talks in Geneva and also in the MBFR talks in Vienna.
Lord Jenkins of Putney: My Lords, is it not the case that to keep the dialogue going the best way is not to describe Mr. Andropov's offer as "bogus"? Is the noble Lord aware that the Russians regard President Reagan's zero option as equally bogus; and that if one merely trades insults, that is not the best way of getting serious talks going?
Lord Belstead: My Lords, the offer is bogus because it deliberately mixes the two sets of negotiations which are going on in Geneva at the present time. An offer to reduce Russian intermediate-range land-based missiles, of which at the moment the Soviet Union has a monopoly, by a trade-off against strategic systems held by the British and the French, is a bogus offer. It would end, as pointed out by my noble friend Lord Nugent of Guildford, in the unwelcome result of maintaining a monopoly for Russia in land-based
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missiles of the intermediate range sort, targeted on every country in Western Europe.
Lord Kennet: My Lords, would the noble Lord recall the complete quotation from Mr. Andropov, of which the Question of the noble Earl, Lord Alexander, quoted only a part? The quotation was as follows:
"Let no-one expect unilateral disarmament from us: we are not a naive people."
Then it continues:
"Nor do we expect unilateral disarmament from the West."
Lord Belstead: My Lords, I am grateful to the noble Lord, Lord Kennet, for that timely question.
Baroness Wootton of Abinger: My Lords, is it not rather a strange use of language to call an offer of that kind "bogus"? A bogus offer, as I understand it, is one which the party making it does not intend to carry out. It would be perfectly legitimate to call this an "unacceptable" offer, but I think it is somewhat provocative to introduce the word "bogus".
Lord Belstead: My Lords, a bogus offer is an offer which is deliberately misleading. Perhaps it would be better if I repeated my final words when talking of Mr. Andropov's offer when I said that the offer is not "a serious negotiating position."
Viscount St. Davids: My Lords, will the noble Lord comment on a rather simple idea in dealing with this question of unilateral disarmament? Should we not give the Russians a permanent three-to-one advantage, on the basis that for every 30,000 nuclear disarmers we allow to run free round our bases they will allow 10,000 to run freely round theirs? Perhaps we could send the noble Lord, Lord Brockway, and his friends to put this proposition and, if they did not wish to do so or if the Russians turned it down, would we then understand how rubbishy it was?
Lord Belstead: My Lords, of course it is a fact that the ability to express views about the perils of nuclear warfare is open to people in the free countries of the West but not to those in the Soviet Union.
Lord Mackie of Benshie: My Lords—
The Lord Privy Seal (Baroness Young): My Lords, I think we have had a very long run on this Question. Perhaps I may suggest that we take the one question from the noble Lord, Lord Mackie, and then move on.
Lord Mackie of Benshie: My Lords, while I agree entirely with the Minister's basic attitude, is it not a fact that we are losing the propaganda war? If we make announcements at the wrong time and the Russians are being much more skilful at propaganda, perhaps we should think a little more about the effect of announcements such as, for example, that about the "dense pack" at a time when a great many people who are foolish in their final answer, in my view, are very worried by the whole thing? In other words, does the Minister not think that our propaganda posture could be improved?
Lord Belstead: My Lords, I entirely take the point of the noble Lord, Lord Mackie, that it is essential to make it clear to people generally that the West wishes to hold out the hand of friendship. Therefore, may I seize the opportunity to remind the House that in the INF talks, the offer from the West is for no land-based missiles at all to threaten the people of Europe, both on the Russian side of the European border and on the Western side of the European border. The offer from the West in the START negotiations is for deep cuts in these terrible inter-continental ballistic missiles. The offer from the West in the MBFR talks in Vienna, which have been going on for eight long years, is for very substantial reductions in conventional forces on the central front in Europe. The West is holding out the hand of friendship and does want to find a way to get verifiable but balanced reductions in forces.

Business
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon, my noble friend Earl Ferrers will, with the leave of the House, repeat a Statement to be made in another place on the Fisheries Council held on 21st December.
My noble friend Lord Trefgarne will, again with the leave of the House, repeat a Statement on the Monopolies and Mergers Commission report on the proposed merger between Charter Consolidated and Anderson Strathclyde.

Local Government (Choice of Electoral Systems) Bill [H.L.]
Lord Harris of Greenwich: My Lords, I beg to introduce a Bill to enable certain local government elections in England and Wales to be held by that system which entitles each elector to a single transferable vote. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.——(Lord Harris of Greenwich.)
On Question, Bill read a first time, and to be printed.

Representation of the People Bill [H.L.]
Read a third time, and passed, and sent to the Commons.

Legal Aid (Scotland) (Exclusion of Proceedings) Regulations 1982
11.27 a.m.
Lord Lyell Lord Lyell rose to move, That the regulations laid before the House on 1st December 1982 be approved.
The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. The regulations provide that legal aid will not be available
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for divorce proceedings which are or could be initiated under what has come to be known as the Cowie procedure. Legal advice and assistance will be available instead, if sought by the parties involved in divorce proceedings. The Cowie procedure will be introduced into the Court of Session on 11th January 1983 by the Act of Sederunt (Rules of Court Amendment No. 6) (Simplified Divorce Procedure) 1982 and will apply to those undefended divorce actions on the grounds of non-cohabitation for two or five years, where there are no children of the marriage under 16 years of age, where no order for financial provision is sought and neither party suffers from mental disorder.
The new procedure is intended to be simple enough to be genuinely "do it yourself so that individuals will be able to seek a divorce without necessarily needing the professional advice of a lawyer. Nevertheless, should there be any uncertainty about the operation of the new procedure, or doubt about the questions to be answered on the various forms, a solicitor may be consulted under the Legal Advice and Assistance Scheme.
The removal of legal aid from actions in the Cowie category will have among its principal benefits the elimination of the need for an often time-consuming and costly assessment of the applicant's financial means by the Department of Health and Social Security. The Scottish Association of Citizens' Advice Bureaux has been involved in the preparation of an explanatory leaflet on the procedure. Both the leaflet and application forms will be widely available through sheriff courts and citizens' advice bureaux as well as in the Court of Session. Legal aid will, of course, continue to be available for all other categories of divorce actions in the usual way. It is not thought necessary to prescribe a higher limit for advice and assistance in connection with Cowie divorce. This possibility was given careful consideration. However, after consulting the Legal Aid Central Committee of the Law Society of Scotland, we decided against such a course. The committee considered that such a provision was unnecessary, and was indeed likely to lead to confusion, administrative problems and needless expense to the legal aid fund. It is, however, intended to monitor the position and if it appears administratively desirable to prescribe a higher limit, further regulations will be made.
The regulations before your Lordships represent a sensible measure to complement the Act of Sederunt so that the savings which the new procedure will bring to divorcing couples may also benefit the Legal Aid Fund. My Lords, I beg to commend these regulations and to move the Motion in my name.
Moved, That the regulations laid before the House on 1st December 1982 be approved.—(Lord Lyell.)
11.30 a.m.
Lord Mishcon: My Lords, I am sure that the House will be indebted to the noble Lord, Lord Lyell, for his explanation of these regulations and for the familiar way in which he uttered the names that apply to Scots law and which are not so familiar to many of your Lordships. He showed a familiarity with them which is

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to be praised, although I wonder whether it really lends towards the memory of any individual that his name should be attached to a divorce. I wonder whether Scotland will have second thoughts about the idea of a Cowie divorce, which means that one Scots lady will presumably say to another: "Did you obtain a Cowie divorce or a non-Cowie divorce?"
Speaking generally, it obviously is sensible that the Scottish legal aid regulations coincide in regard to simple divorce matters with those that are applicable in the rest of the United Kingdom. The only observation that one would make—I think generally not only in regard to legal aid regulations in Scotland, but throughout the United Kingdom—is that there does not seem to be enough provision made for a conciliation procedure where legal aid might be applicable. This is essential. This is something which I think is a defect in Scotland as well as in the rest of the United Kingdom. Many lawyers who are skilled in the art of advising people on a human basis, as well as on a legal basis, would like to have the opportunity of seeing whether on given facts there is a chance of reconciliation—mainly, as your Lordships know, for the benefit of the children as well as obviously for the parties concerned.
So I wonder whether thought can be given in the future—it obviously cannot be incorporated in these regulations, but it is an opportunity for mentioning this point—to have another look at the whole way in which our family law is dealt with in the divorce courts to consider proposals that I know that the noble and learned Lord the Lord Chancellor has for one court to deal with these matters in the United Kingdom. Scotland I think will also want to look at this. Also, can there be thoughts as to whether there could be, with legal aid applicable, an informal conciliation procedure where parties can go and have informal talks to see whether a reconciliation is not, in all the circumstances, sensible and a divorce can be avoided? Apart from this, I have nothing more to say in regard to these specific regulations.
Lord Lyell: My Lords, we are very grateful for the kindly comments from the noble Lord, Lord Mishcon, on the somewhat complicated name of the Act of Sederunt. We hope that the name of Cowie will not be attached in any unpleasant way to the thoughts of divorcing couples. The name of Cowie might well attach itself to the thoughts of compassion and possible reconciliation, which the noble Lord mentioned in his typical fashion. We are, after all, discussing rather sad events should they occur in the lives of any of us—possible divorce.
The noble Lord mentioned the possibility of reconciliation. He also drew attention to the possible position of children in divorce procedures. The noble Lord no doubt will have noticed in the regulations that a schedule is attached which is called Form 19A. It refers to "Part I" and "Part I continued"—it is rather like one of these hideous application forms that we have to fill in for passports, driving licences, and so on. Some of the clearer aspects in this form are concerned with reconciliation. It asks quite clearly in paragraph (6) of Part I of this form, which will under the Cowie
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procedures be explained, if necessary, to the parties by a solicitor, as follows:
"Is there any reasonable prospect of reconciliation with your husband or wife?"
One is asked to strike out, "Yes" or, "No".
In the second part of paragraph 6 it is asked:
"Do you consider that the marriage has broken down irretrievably? Answer, 'Yes' or, 'No' ".
I understand that this has to be completed by both prospective partners or ex-partners, so at least we have gone part of the way, we hope, to meet the possibility of reconciliation and not bring in too hasty action in divorces of this nature.
Also in paragraph 9 of Part I we find another question which is simple enough:
"Are there any children of the marriage under the age of 16?"
One is asked to reply, "Yes" or. "No". I stressed in the four main points which would have to be met in order to obtain a simplified divorce under this procedure which I have outlined that, first of all, there has to be non-cohabitation for two or possibly five years. Secondly—and I am sure that the noble Lord, Lord Mishcon, will accept this—there must be no children of the marriage under 16 years of age. If there are children then the Cowie procedures would not necessarily apply. They might do so but, as I understand it, if there are children under 16 years of age, I do not believe that these procedures would necessarily be adopted. If I am wrong, I shall inform the noble Lord. He will appreciate that with the Christmas and New Year break it may be a little while before I am able to reply, if that is necessary.
I have further information on why there is no provision for conciliation as opposed to reconciliation which I was mentioning in paragraph 6. The noble Lord will be interested to know—and I am sure that your Lordships will be interested to know, if I may set this out briefly—that a working party which was set up by the noble and learned Lord the Lord Chancellor is indeed considering the role that conciliation might be given in future court procedures. As your Lordships will appreciate, Scotland will be closely interested in the recommendations of this working party. A conciliation scheme is to be set up shortly in Edinburgh with financial assistance from the Government. I hope that will go some way towards satisfying what I believe are very justified fears which have been raised by the noble Lord, Lord Mishcon. We are very grateful to him for the care and the courtesy which he has extended to us in considering the sometimes rather complicated regulations today.
On Question, Motion agreed to.

Films (Suspension of Quota Requirements) Order 1982
11.39 a.m.
Lord Lyell Lord Lyell rose to move, That the draft order laid before the House on 7th July be approved.
The noble Lord said: My Lords, I beg to move that the House approves this order. The draft order has been considered by the Joint Committee on Statutory

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Instruments. I am given to understand that they have made no comments on it whatever. I hope that your Lordships will bear with me if I explain first what the quota applies to. Secondly, may I briefly refer to something of its history; and, thirdly, to the way that it works at present.
Lord Hale: My Lords, may I ask whether we have reached the pneumoconiosis order? I wish to say a few words on that.
Lord Lyell: My Lords, if the noble Lord, Lord Hale, will bear with us, he may have a little while to wait. I have to deal with another order after this one, and then I think my noble friend also has an order. Therefore, it will be a little while before the pneumoconiosis regulations are before the House.
Lord Hale: My Lords, I am anxious to ask a question on the pneumoconiosis regulations.
Lord Lyell: My Lords, we are discussing the Films (Suspension of Quota Requirements) Order. That is what I am attempting to explain to your Lordships. Your Lordships may wish me to give a dissertation on pneumoconiosis, but I would rather leave that to the specialists and, above all, to my noble friend who will be with us ere long. If the noble Lord, Lord Hale, will bear with us, we might consider what goes on in the film world and even go back to 1927.
Since 1927, and subject to various provisions for exemption and relief, cinema operators in the United Kingdom showing standard 35mm film have been required to show British films for a percentage of their total playing time. For first feature films, the percentage relates to the number of days on which films are exhibited in each cinema; for supporting films the percentage relates to the showing time of such films. The provisions were extended to include Community films when the United Kingdom entered the European Community in 1973.
There are, not surprisingly, conflicting and strongly held views on the effectiveness of the system; but possibly there is less doubt about the administrative burden placed on already hard-pressed cinemas. For the system to operate, it is necessary for every cinema in the country to keep a quota record book in which full details of films shown are entered week by week, including (your Lordships will be pleased to hear) playing time of the films. At the end of the year, these books, duly certified, are forwarded to my department where they are checked for accuracy and quota achievement.
The relevant statute provides for penalties to be imposed on exhibitors who do not meet the percentages, or who fail to make returns; but there is a system for examination of quota failures by the Cinematograph Films Council. Despite the extensive number of failures, there has, in fact, been no prosecution since 1956. In 1981, for instance, about 24 per cent. of cinemas failed to achieve quota without any action being taken. The Films Act 1960 provides that it shall be a satisfactory defence of failure to achieve quota if the exhibitor can show that it was not
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commercially practicable to comply with the requirements, and it is now considered highly unlikely that any prosecution for failure to achieve quota could succeed.
There has been wide variation over the years in the level at which quota has been set. For first feature films, the level was 12½ per cent. in 1938; in the early 1940s it was 15 per cent. and in 1948 it was raised to 45 per cent. In 1949 it came down to 40 per cent., and then in 1950 to 30 per cent. For this year it was reduced to 15 per cent. The order now before the House would suspend these quota requirements, and cinemas would be entirely free to make their own decisions.
I hope your Lordships will bear with me if I put these figures into their relevant context. It is thought that at the end of the 1940s, 1½ billion people—and, for this purpose, I am using the American style of 1,000 million people—went to the cinema each year. This year, cinemas will, as things are going, be lucky to get 65 million attending. The position on the number of films made is no better. In the late 1940s American film production reached around 250 a year, and films made in the United Kingdom were 80 or 90 a year. This year American production could be less than 100 and United Kingdom film production could be as low as 25. I would remind your Lordships that there are nine days to go, and these are not final figures for completions. However, we believe that these figures will be in the right direction.
It is against this background, and, above all, the continuing collapse in cinema audiences, that the Government have decided that it would be wrong just to wait until the end of the year before reviewing the question of quota. Consequently, we have considered carefully the arguments for and against quota and have consulted the Cinematograph Films Council. We have, as a result, concluded that the economic position of the cinema is so poor that immediate action to remove the administrative burden of quota is essential.
It is not, however, expected that cinemas' behaviour with regard to the showing of British films will change dramatically. In fact, the very low number of films likely to be available overall will, inevitably, give a strong position to British films. The very favourable tax regime for British films over the next two years should increase the proportion of such films in the lower overall number, making the position even more favourable. While I appreciate the arguments of those who support the continuation of screen quota at a high level, I think that the film industry must have the courage to make a break with what we call the psychological props of the past, and seek a new direction.
No one would pretend that video, cable and satellite will provide a magical overnight solution to the problems of the film industry, but—and this is hypothesis—if piracy can be controlled and a suitable regulatory structure devised they could present a very real opportunity to the film industry in the medium-term. Equally, one cannot simply ignore the plight of the cinemas and, above all, those who work in them. Everybody who works in the film industry deserves help as well, and suspension of quota represents a small step in the right direction. My Lords, I commend this order to the House.
Moved, That the draft order laid before the House on 7th July be approved.—(Lord Lyell.)
11.47 a.m.
Lord Ponsonby of Shulbrede: My Lords, I thank the noble Lord, Lord Lyell, for explaining this order. It was about 18 months ago that he came to your Lordships' House and pleaded for an order to reduce the amount of the quota from 30 to 15 per cent. I agree with his movement of this order today more in sorrow than in anger. The fact that exhibitors have had continuing difficulty in achieving even the reduced quota of 15 per cent., and the fact that there have been no prosecutions since the previous order was laid, underline the difficulty which exists because of the present state of the British film industry.
But one should look upon the laying of this order as an action of despair, rather than as a positive action to help the British film industry. I do not think—and the noble Lord did not produce any evidence to this effect—that the existence of a 15 per cent. quota was in any way damaging the industry. It was a target to which exhibitors could work. The fact that there had not been any prosecutions did not invalidate the fact that there should be a target for exhibitors to work towards in the showing of British films. Futhermore, a target brings to their notice the fact that they should try to show that percentage of British films.
I consider the laying of this order premature at this time, while there is a major ministerial review of the film industry under way. This review could involve—and, indeed, one hopes that it might involve—an extension of the Eady levy system to cover television films and films shown by cable. Alternatively, the review might suggest that the Eady levy should be done away with. It is a regrettable fact that, allied to decreasing cinema audiences, a decreasing amount of Eady levy has been available to the industry. If the Government were concerned about the vitality of the industry, I am sure they would be looking in the direction of extending the areas to which the Eady levy applies rather than to abolishing it. The review will no doubt cover the question of the role of the National Film Finance Corporation. The review could suggest an enhanced role for the National Film Finance Corporation, or it could suggest that the corporation should be abolished.
I wonder whether the noble Lord, Lord Lyell, could say anything about the Government's intentions concerning the vitality of the British film industry as a whole. It seems to me that in moving this order today the noble Lord is adopting a piecemeal approach to the problems of the British film industry, and that it would have been better to wait until the results of the review were known and until one could see whether or not this is an appropriate part of the package. I regret that this order has been laid today.
Lord Beaumont of Whitley: My Lords, the most that anybody can find to say about the order is regret, and even that in a not tremendously convincing tone. It was notable that although the spokesman for the Labour Party in another place went through the motions of regret, none of his colleagues who spoke
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greeted it as anything other than an absolutely inevitable result of the situation which has occurred in the film industry over a large number of years. There are cases to be made for not doing away at the moment with the quota. The case which the noble Lord, Lord Ponsonby of Shulbrede, made—that we are in the middle of a review of the film industry—seems to me to be a very good one, but it would possibly have more force if any of us had much hope that anything much will come out of that review. That point was made by my honourable friend Mr. Clement Freud, who said that in the intervals while waiting for the real successes in the film industry—the blockbusters—to come along, we might as well have British rather than American mediocrity to fill those intervals. There is a case for that, too. But one way or another, no one will very much mourn the quota, not least because one point upon which we on these Benches agree with the Government is that, if there is a bit of needless form filling to be done away with, we would rather that it was done away with.
The really unfortunate thing behind the order today is the disregard which the film industry has suffered ever since the war. The real core of the problem, as we in the Liberal Party have identified it—and I think it is widely accepted by a large number of people—is that the film industry is under the Board of Trade and not under a Minister for the Arts. It has to do with a large amount of money. It has to do with exports and imports. One sees the reason why it was at one time put under the Board of Trade, but the decisions which have to be made about investment in the film industry have much more to do with the arts than they have to do with the straightforward decisions of merchants. Whether you are dealing with small and successful films like "Kes" or with the great big blockbusters like "ET", the fact is that they are very much dependent upon a certain vision of the film-makers: a vision which the organisations and departments which are set up to forward commercial ventures in generality are not really able to apply. I do not believe that we shall have a flourishing film industry again until films are transferred to a Ministry for the Arts, or whatever it may be called.
The film industry has got into a very sad state. In a way, we have suffered from some of our advantages. One of the great advantages that we in this country have in all matters of culture is the English language. The fact that we share it with the Americans means that it now spreads all over the globe and that it is the governing language in a great many places where art of all kinds is shown. Particularly when art depends upon the spoken word, as is predominently the case in the film industry, that should be an advantage. Alas! it is not. It enables us to sell off our film industry, which is basically what we have done over the last few years, to the Americans, because it is transferable in a way which is not open to the French and the Germans. They have been able to keep their film industries going at a much more reasonable level because they are dealing with a single language situation.
We should have been able to resist the disadvantage of the common language. We should have been able to keep our film industry going. We are still capable of producing wonderful films. In the last couple of years we have produced at least two or three which prove

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what our film makers can do. But the dead hand of commerce is on the industry, particularly the dead hand of the Board of Trade. I do not lay this in any way at the door of any particluar Government. It has gone on in the same way ever since the war. But the fact remains that if the film business could be taken away from the Board of Trade and moved to a Ministry for the Arts it would stand a far better chance of flourishing, which I am sure we all hope it will do.
Lord Drumalbyn: My Lords, may I ask my noble friend two simple questions? First, while the Ministerial study is taking place, will records be kept of what the cinemas are showing? Will each cinema have to show how many British films it shows, how many American films it shows and how many films from other countries it shows? Secondly, what exactly is meant by "a British film"? I am afraid I am a little out of date because it is some years since I have had to deal with the subject, but there were co-production agreements. Does a film which is produced in conjunction with another country—say, France or Italy—rank as a British film for the purposes of the records kept, or are records to be kept separately for different countries? It would certainly make the planning and consideration of the whole future of the film industry very much easier from the governmental point of view if records were to be kept and, if necessary, slightly amended to make them more meaningful.
Lord Jenkins of Putney: My Lords, I must apologise to the noble Lord for having missed the first minute or two of his opening statement. As a result, I am not quite clear about the position relating to the Cinematograph Films Council. As I understood the noble Lord, he said that the council had been consulted but he did not say what its response was or whether it had agreed to the abolition of the quota as an immediate step. If there was no immediate agreement to the abolition of the quota, this would add weight to the view of my noble friend Lord Ponsonby of Shulbrede that this measure may be premature and will best be dealt with as part of a general review of the film industry and film industry legislation—something which one presumes is almost ready to be brought before both Houses of Parliament.
One is sad about the abolition of this quota—not that one is in favour of restrictive legislation in principle, but the British film industry has survived a very difficult situation. The quota has given an element of protection to our home industry and, in a difficult time, the industry has continued to produce products of high international repute. Even in our present plight the British film industry ranks high in the world and has recently received the highest possible acclaim in the United States of America. It is rather sad that the film which achieved that distinction, "Chariots of Fire", was financed almost entirely with American money and that very little British money went into this essentially British film, which will give a very good return.
It seems very sad that the City cannot be persuaded to take a chance on the film industry. It is a chancy industry and a good deal of money has been lost in it in the past; but the Americans were prepared to take a chance on "Chariots of Fire" and they have profited
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as a result of their enterprise. It is rather sad that British financiers appear to have cold feet in this respect.
All this adds point to a proposal I put forward some time ago. As the noble Lord, Lord Beaumont of Whitley said, the British Film Institute has become responsible for an increasing proportion of the activity in the industry. Unfortunately this is due to the decline of the commercial element, but there is no doubt that, relatively speaking, that part of the British film industry which is already under the aegis of the Minister for the Arts is becoming more significant. Not only is it active in its own art films area, as it is called, but it has also created a great deal of spin-off in both the commercial film and television areas as well.
There is increasing pressure for the transfer of ministerial responsibility and for the whole of the film industry to be under the aegis of one Minister. We are now moving into the situation where the film industry can no longer survive on a purely commercial basis. That seems to me to be the point at which the Minister for the Arts ought to step in if we are to maintain a film industry which is capable of surviving because we cannot maintain an effective commercial film industry unless the industry as a whole survives. Having said all that, I do understand that the case for the quota is by no means as strong as it used to be. At one time there was an undoubted case to be made for the proposition that the exhibition and production sectors of the industry depended upon the existence of a quota. With the decline of the entire industry and particularly the British element of the industry, the necessity for that quota is much less apparent.
But as my noble friend has said. I feel that this abolition is rather premature. As the noble Lord, Lord Beaumont of Whitley, has said, there is a certain lack of indignation about the place. We are not furious but we are upset. We are sorry about it.
I can only hope that, as a result of the more general approach which the Government are going to bring to this matter, we shall be able to put the British film industry on its feet not only in respect of production and distribution but also in the exhibition area as well. It has gone through a bad time. It is an industry which has earned us very considerable repute abroad. The Government owe it to the industry to do what they can to ensure that the British film industry survives in the future.
12.05 p.m.
Lord Lyell: My Lords, we are all very grateful for the interested and vivid response we have had from all parts of your Lordships' House. The noble Lord, Lord Ponsonby of Shulbrede, mentioned that there had been no prosecutions going back for quite a while. This was just one of the factors which entered our minds in considering whether the continual administrative burden of keeping up these film quota books should really be laid upon the cinema owners or not.
The noble Lord, Lord Ponsonby of Shulbrede, made several other points. First, I should stress to him the low number of films which become available for distribution each year. I mentioned 100 films as an approximate figure for the United States' industry and around 25 for the United Kingdom's film industry.

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Even if these numbers are completed, it depends on the commercial success of, perhaps, a very small number of these films as to whether or not the cinema industry, first, and the British film industry, secondly, will enjoy a healthier financial climate than they have in years past.
We do not have the figures for the achievement of the quota relating to the 15 per cent. level, which is the level we are hoping to abolish from today. The figures quoted for 1981 related to the level of 30 per cent. I would stress again the low overall level of the supply of films. Indeed, the statutory defence available to exhibitors is that it reduces very markedly indeed the effect of the quota and the administrative burden still remains.
Several of your Lordships asked me about the review of policy. I am sure that Members will have read some of the rather dramatic press reports on the subject of the Eady Levy, which suggested that my honourable friend the Parliamentary Under-Secretary of State had decided to abolish it. I should stress that that was just one of a wide range of options which have been put to him—including the option of extending the levy to television films and video films. I am sure that my honourable friend will be happy to receive representations on this matter from those who have expertise and, above all, the benefit of professional experience to impart to him. I know that he hopes to reach some conclusions by the spring of next year—including a decision on the whole question of the levy as well as the role of the National Film Finance Corporation.
I should like to stress also the financial benefits which are achieved by the film industry. The exports of the British film industry for 1981 amounted to £30 million. We believe that that compares very favourably with the export of British television material, which was valued at one-third of that figure, in the region of £10 million. The noble Lords, Lord Jenkins of Putney and Lord Beaumont of Whitley, raised the question of ministerial responsibility. Indeed the noble Lord, Lord Beaumont of Whitley, called it in his very colourful way the "dead hand" of the Department of Trade. For as long as I am in that department there will be no "dead hand" there—least of all belonging to my noble friend the Secretary of State, or indeed the other Ministers, or the people who work there. The noble Lord and your Lordships will be aware that the very success of the British film industry is tied up as well with finance and practical considerations as much as the artistic content of films.
So far as ministerial responsibilities for the British film industry are concerned, the allocation of these is entirely the prerogative of my right honourable friend the Prime Minister. We would see the force of some of the arguments, especially from the noble Lord, Lord Jenkins, who has considerable expertise in this area. I would think that more to the point would be action to make sure that the Government ceases to interfere quite so much with the film industry, which we regard as grossly over-regulated by any standards.
My noble friend Lord Drumalbyn asked me about the 1982 records. These will be completed and analysed, but I would stress that they will not be so collected for 1983.
Lord Beaumont of Whitley: My Lords, before the noble Lord the Minister moves on, he has said that he and his colleagues regard the film industry as being grossly over-regulated by any standards. Would he care to give some examples? Now having done away with this particular quota, what else is there in the film industry which is ripe to come under the pruning hook? Presumably he has not made such a wide statement without being able to produce some other candidates.
Lord Lyell: My Lords, I will reply to the noble Lord, Lord Beaumont, but not yet. May I find some fruitful examples and let him have them in writing? I was attempting to reply, in tennis terms, to his first service. He was trying to drive me deeply to the back court, and I will send him a high lob which may take some time to arrive; it may come by cable, video, pigeon post or ministerial post. I will attempt to find some interesting examples of how the Government believe that we do interfere, possibly a little too much, in the film industry. We have attempted with this order to relieve one of the pinpricks and administrative burdens. I shall certainly endeavour to discover any more of the more esoteric burdens and duly inform the noble Lord.
Lord Ponsonby of Shulbrede: My Lords, before the noble Lord leaves that point, is he trying to anticipate the results of the review and will the review in fact produce the answers to the question the noble Lord, Lord Beaumont, has asked?
Lord Lyell: My Lords, I fear that the noble Lord, Lord Ponsonby, is possibly anticipating not only the review but what I might have to say. I certainly would not be anticipating the review. Your Lordships know me as a Scot, maybe not a canny one; I would never bet on a hypothesis as to what is in the minds of the review body, nor indeed of my right honourable and noble colleagues. I think that, if we may allow the review to continue, we shall no doubt be fascinated to see what conclusions it comes up with.
If I may continue to answer, the second point raised by my noble friend Lord Drumalbyn was the question of British films. When we consider the quota for the cinema screen, my noble friend is quite right, we should keep in mind just what the word "British" means in this context. Broadly, we believe it means that films made here are British if they provide substantial benefit to our industry. These films do not have to be financed here, nor do they have to be films reflecting possibly British life and manners. I would enlighten your Lordships—the noble Lord, Lord Jenkins, may know this, but certainly I did not—by saying that "The Empire Strikes Back", which I have had the pleasure of taking some of my younger relatives to see, and "Superman", which I have not yet seen—it is not shown daily in your Lordships' House—are two British films.
The quota for British films has also to include European films, of which, I am sure your Lordships would agree, some are of merit and some not; indeed my note says, many not. One noble Lord's poison is another noble Lord's or Baroness's meat. But in the context in which my noble friend was asking the

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question, "British" does not mean what many might wish it to mean. The quota records distinguish between British and other Community films and indeed foreign films. Registration records will show for 1983 the number of films registered, but not necessarily analysed according to to whom and where they were shown.
The problem of consultation with the Cinematograph Films Council was raised. I am sure your Lordships will agree that we have to recognise that on this subject different parts of the film industry would wish to see different solutions. The council itself is composed of representatives of different parts of the industry, and on issues such as the one we are discussing the members tend to vote in accordance with the view of their parent organisations. Also the discussion and the vote tend to vary widely according to who may or may not be present. In this instance the members discussed the proposal to suspend the quota, and the conclusion was reported along with the views of two members who were not able to be present. We are satisfied that we have had the views of all the major interests represented on the council.
Lord Jenkins of Putney: My Lords, can the noble Lord clarify that? Is he really telling us that the Cinematograph Films Council was not unanimously in favour of this proposal? Is that what he is saying?
Lord Lyell: My Lords, I do not know whether a vote was taken or exactly what the views were. I stressed that we have taken these views into account. I shall endeavour to find such information as I can as to what their views were. I do not know that we, in the popular parlance, "bugged" the room or the negotiations, but I shall endeavour to find out what the views were and communicate with the noble Lord briefly.
I have possibly wearied your Lordships with somewhat lengthy explanations of this fairly simple order. I would ask your Lordships' indulgence. 'We have strayed over "Superman", and "The Empire Strikes Back", and other things, but I am sure your Lordships with your traditional indulgence will accord me a little licence in such matters. Indeed, regular attenders among your Lordships are very rarely able to leave your Lordships' House to see the fruits of the work of the great British film industry, but possibly we might be able to do so over the next two or three weeks. I hope I have answered most of the questions raised. If I have missed any, may I write to the noble Lords who raised them, in addition to the two noble Lords to whom I have already promised to write?
On Question, Motion agreed to.

Monopolies and Mergers Commission (Membership of Groups for Newspaper Merger References) Order 1982
12.20 p.m.
Lord Lyell: My Lords, I beg to move that the Monopolies and Mergers Commission Order, the draft of which we have before us, be approved. Your
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Lordships will be interested to know that we hope that this order will improve the workings of the Monopolies and Mergers Commission in the case of newspaper mergers, by making two quite small changes in the content of the group which carries out the inquiry.
I hope that I may briefly explain the present position. I see the noble Lord waiting to spring to his feet, but I shall not be very long and we must wait to hear his expertise. Your Lordships will be aware that newspaper mergers involve similar economic issues as in general mergers, but they also involve some special issues—for example, expression of opinion and, above all, the accuracy of reporting. For this reason special arrangements were set out in the Fair Trading Act 1973. The group of members investigating a newspaper merger may have its members—I stress "may"—drawn from two different sources in order to cover the different issues which have to be examined: regular commission members selected by the chairman of the commission and a number of additional members, who may be appointed by the Secretary of State and are drawn from a special merger newspaper panel. The present position is that at least five members must come from the commission and three, four or five additional members may come from the newspaper panel. In practical terms this leads to a fairly large and what we regard as a somewhat unwieldy group of at least eight members.
The order that we have before us today makes two changes. First, while leaving the total number of the group at a minimum of five, it would allow the five members to be made up of a combination of regular and special members. The second small change that the order makes is to allow the number of special members appointed to be one, two or three instead of the three, four or five as at present. The combined effect of these two changes is that the overall minimum for a newspaper merger inquiry is reduced to the same number as that for other merger references, and that is a minimum of five. It can contain a combination of regular and additional members as would seem appropriate. There is no doubt that this more flexible arrangement will help the commission to execute its task more effectively without in any way altering the principles which govern the investigation of newspaper mergers. With that brief explanation I commend the order to your Lordships' House. My Lords, I beg to move.
Moved, That the draft Monopolies and Mergers Commission (Membership of Group for Newspaper Merger References) Order laid before the House on 22nd November 1982 be approved—(Lord Lyell.)
Lord Ponsonby of Shulbrede: My Lords, I rise briefly to thank the noble Lord, Lord Lyell, for explaining this order. The noble Lord did not appear to mention that the order had been considered by the Joint Committee on Statutory Instruments and in its fourth report had no comment to make on this particular order. As the noble Lord so eloquently explained, the purpose of the order is to vary whether the members of a merger panel are regular or additional members. It allows more flexibililty in the composition of the panel and reduces in total the number of members of the panel to five, but it does not alter any principle relating to the consideration of

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mergers in the newspaper industry. Therefore, this is an order to which we do not object.
On Question, Motion agreed to.

Industrial Training Levy (Construction Board) Order 1982
Lord Glenarthur Lord Glenarthur rose to move, That the draft order laid before the House on 2nd December 1982 be approved.
The noble Lord said: My Lords, this levy order requires parliamentary approval because part of it involves a levy of 2 per cent. on payments made by employers in the construction industry for labour-only sub-contracting. In many respects the order is similar to that of last year. For most of the construction industry there is an occupational levy. This is a set amount for each occupation employed, but is subject to an overall limit of 1 per cent. of the wage bill.
All firms pay the levy except for the very small ones—that is, those with a wage bill of less than £15,000. For the labour-only sub-contractors' payments, the proposed levy is 2 per cent. Last year it was also set at this level, but it was then subject to an overall restriction of the whole levy to 1 per cent. The difference is that this year, for the first time, the 2 per cent. levy is not in any way restricted. This 2 per cent. levy will be applied to the payments made by firms who employ labour-only sub-contractors. For their other employed staff a firm will pay the usual occupational levy, but this element alone will be restricted to 1 per cent. of the pay bill.
Perhaps I should explain that the Construction Industry Training Board has no exemption from levy in respect of an individual firm's training performance, although this is possible under the 1982 Act. With the support of the industry it has chosen to levy all firms except those of small size, and this has been its policy for a number of years. The board estimates that the levy will raise about £38.6 million which will be used to finance training necessary to the industry.
The proposals outlined in the order have received detailed consideration and consultation. They have been unanimously approved by the Construction Industry Training Board and the Manpower Services Commission. Furthermore, the principal employers' associations in the construction industry have indicated their agreement with the 2 per cent. levy.
There may be those who are in some doubt about the necessity for a 2 per cent. levy. The reason is that very little training is done by labour-only subcontractors. There are, of course, inherent difficulties in organising training for a mobile and somewhat fluctuating workforce which, for the most part, is engaged in work at temporary sites, and the board is anxious to correct this previously unsatisfactory situation. As I have said, the proposals contained in the order have the agreement of the board, employers and the trades unions. I therefore commend the order to your Lordships. I beg to move.
Moved, That the draft Industrial Training Levy (Construction Board) Order laid before the House on
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2nd December 1982 be approved.—(Lord Glenarthur.)
Lord McCarthy: My Lords, I support the Motion that this order should be agreed. Indeed, there is very little I want to say about it. I have only two points to make. First, as I have said, we argue that such a levy is essential if there is to be any training in what is undoubtedly a key industry. If the Government ever wake up and generate some work for the construction industry we shall immediately run into the shortage of craftsmen that we have run into in previous times when there has been an upsurge of work in construction. Therefore, there must be training, and that training will not be done on a voluntary basis by the industry. Consequently, we are very glad to see that the industry has retained its training board and is now proposing to raise a levy worth £38.6 million a year.
My second point concerns the balance between a 1 per cent. levy for people who are on employment contracts and a 2 per cent. levy for labour only subcontracting. I note what the noble Lord said and I gave him some notice that I would be asking him a question about this. I note that he has given us quite a bit of information on why there is the 2 per cent. It is the balance between 1 per cent. and 2 per cent. that I am not quite able to follow. The noble Lord appeared to be saying at one stage that there were expected to be particular benefits to the labour-only sub-contractors. I suppose, as he says, that is because they do not do any training. If that is the case. I do not know whether we are convinced that a 2 per cent. levy will in fact force them to do the right amount of training. I do not know why 2 per cent. is considered the necessary figure to force them to do this training or to have the money available to give them when they do that training.
The noble Lord did not suggest, although he may be doing so, that perhaps the increase of 2 per cent. against 1 per cent. is because we expect a certain amount of evasion of the levy. I thought he was saying at some stage that, because it was very difficult for sub-contractors to do training—or perhaps one might say that because it was very difficult to see whether sub-contractors do training or not—maybe those who can be persuaded to do training have to do a lot of training to make up for those who do not do training. Is it really evasion that brings about the increased levy for sub-contracting? Is the increase in the levy for sub-contracting, as against the levy for non-subcontracting, to be taken as some indication—as I think we on this side of the House would say—that there is something rather unsatisfactory about the whole notion of sub-contracting in the construction industry?
12.31 p.m.
Lord Kilmarnock: My Lords, I must apologise to the noble Lord, Lord Glenarthur, that I came into the House when he had already risen to his feet and had started his speech. I wished to ask him about the limit of the levy to businesses employing more than a certain number of employees—I think the noble Lord mentioned a wage bill of £15,000. Perhaps the noble Lord can confirm that? Is this to be done on the basis of a wage bill or on the basis of the number of employees?

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I should like to raise one other point, although I realise it is not strictly connected with the construction industry. However, I do not think it was debated during the debate on the report of your Lordships' Select Committee on Unemployment in which it was pointed out that in the Employment and Training Act 1981 the Government reduced the number of ITBs from 24 to seven. Your Lordships' Committee made a strong recommendation in paragraphs 11.62 and 11.63 urging that the MSC be asked to produce a study of the feasibility of an across the board remissible training levy. It was suggested in the report that the product of the 1 per cent. pay roll tax across the board—that is to say, public and private sectors—would produce something in the region of £1.37 billion for training. In paragraph 11.63 the report urged the MSC to adopt the principles set out in paragraph 11.62. As this is the last opportunity this year to speak on matters of this type, I should like to ask the noble Lord whether he will give the House an assurance that the attention of the MSC will be drawn to paragraphs 11.62 and 11.63, and that they should be encouraged to produce a feasibility report on a scheme of this nature.
Lord Glenarthur: My Lords, I am grateful to the noble Lord, Lord McCarthy, and to the noble Lord, Lord Kilmarnock, for their welcome to this order. As regards the imbalance—if that is the right word—between 2 per cent. and 1 per cent., to which the noble Lord, Lord McCarthy referred, I point out that 2 per cent. is the figure recommended as desirable by all sides of the industry for the coming year. Last year the figure was 1.5 per cent. subject to the overall limit of a 1 per cent. levy on the pay roll.
Labour-only sub-contracting is, by itself, not undesirable, but it is widely recognised that little training is done by labour-only sub-contractors. The purpose of the 2 per cent. levy is to try to ensure that labour-only sub-contractors make their contributions to the training needs of the industry and do not avoid it—if that is the right word—and thereby end up in a position where they can pay people more and so pinch people from elsewhere in the industry. I hope that that answers the noble Lord's point.
The noble Lord, Lord Kilmarnock, raised a question on the limit of £15,000. Smaller firms will not be subject to the levy. If the figure is £15,000 or below, they do not have to be levied. As regards his later question about the Manpower Services Commission, I am afraid that I am not able to give him an answer to that now, but perhaps I may talk to him afterwards or even write to him.
On Question, Motion agreed to.

Pneumoconiosis etc. (Workers' Compensation) (Payment of Claims) (Amendment) Regulations
12.35 p.m.
Lord Glenarthur Lord Glenarthur rose to move, That the draft regulations laid before the House on 16th November 1982 be approved.
The noble Lord said: My Lords, I beg to move that the Pneumoconiosis etc. (Workers' Compensation)
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(Payment of Claims) (Amendment) Regulations 1982 be agreed to. These regulations are simple and uncontroversial, and are to be made under the Pneumoconiosis etc. (Workers' Compensation) Act 1979. They will have the sole effect of increasing, by 40 per cent., each of the payments made under the Act to sufferers, and the dependants of deceased sufferers, who first become entitled to a payment on or after 1st January 1983.
Before I go on to talk about the regulations, I think that perhaps I ought to say that I know that some of your Lordships take a considerable interest in compensation for victims of dust diseases, and may want to raise issues which go well beyond the scope of what we are discussing today. Of course, these are important areas, and I do not want to deflect your Lordships' attention from them; but I hope that today we might impose some sort of a self-denying ordinance and concentrate merely on the regulations which are before us.
What do the regulations mean? Perhaps I can start by listing the three main conditions of entitlement for sufferers which are set out in the Act. These are, first, that the applicant is being paid disablement benefit because of one of the diseases the Act covers; secondly, that every relevant employer of his has ceased to carry on business—and I shall come back to that later—and, thirdly, that he has not brought any action, or compromised any claim, for damages. For example, let us take someone who meets the last two conditions and is awarded disablement benefit in January next year. He would be entitled to compensation at the new rates. Another example would be a person who is receiving disablement benefit now but who has a relevant employer left who goes out of business on or after 1st January but within the 12 months normally allowed for application after the date when disablement benefit first becomes payable to him. He, too, would be paid at the higher rate.
To date there have been over 5,500 applications for compensation under the Act. Some 1,200 applications were rejected for failing to satisfy all the entitlement conditions prescribed in the Act. The majority of those which failed did so because there was still a relevant employer in business. The Act explains that a relevant employer is any person by whom the disabled person was employed at any time while he was developing the disease and against whom he might have or might have had a claim for damages in respect of his disablement. It also means the whole firm, and not just an individual mill or plant.
The people who will continue to be paid at the current rates are those already qualified or who qualify this year, but do not get around to applying until next year. What matters is when someone in fact qualifies, and not when he or she applies. The current rates were laid down in the Pneumoconiosis (Workers' Compensation) (Payment of Claims) Regulations 1979. These were debated by your Lordships' House on 18th December 1979, and came into operation on 1st January 1980. The 40 per cent. increase is intended to restore the payments to the value they had when the original rates were determined.
Being anxious to be as fair as possible when interpreting this condition, my right honourable friend

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the Secretary of State took legal and medical advice on what should be regarded as a relevant employer still in business. My right honourable friend was also advised that a disabled person might not have a claim against a former employer where the employment in question did not appear to have made a material contribution to the development of his disease. Following this advice a payment was made to about 500 applicants whose applications had previously been rejected.
Perhaps I should also say something about the time limit for making applications. Normally this is 12 months after disablement benefit first becomes payable to them. Sometimes it happens that someone applies promptly after he or she learns the sad news, only to be turned down because there is still a relevant employer in existence. However, to make sure that people do not lose out by applying quickly, rejected cases are reviewed at the end of the 12 months during which those people could have applied. If they qualify within the 12 months, they are paid. The Determination of Claims Regulations made under the Act also give the Secretary of State discretion to accept late applications, and this direction is used fairly generously so that if someone would have been entitled to a payment had he or she applied in time then the claim is generally allowed.
Some might say that the payments are low when compared with what can be awarded by the courts to those able to bring a claim. But it should be remembered that claimants under the Act do not have to demonstrate that their employers have been in breach of either a statutory or common law duty. This is an important difference which I believe should be reflected in the size of the payments made.
The rates of payment will be kept under review in the light of further changes in the value of money. I am sure that these proposals offer a fair rate of compensation for the immediate future. Whatever the size of the payment, it will never truly compensate individuals and families for the pain, the distress, the suffering and the loss that they suffer. At least we shall have done something to alleviate the dreadful effects of these diseases for those most intimately affected. Therefore, I commend the regulations to your Lordships.
Moved, That the draft regulations laid before the House on 16th November 1982 be approved.—(Lord Glenarthur.)
Lord McCarthy: My Lords, I have pleasure in agreeing to this Motion on behalf of my side of the House. We have no intention of going into the provisions of this Act, as the noble Lord, Lord Glenarthur, suggested we might, although I understand that my noble friend Lord Davies of Leek wants to say something about those matters after I sit down.
All I want to do is to thank the noble Lord for what I take to be the principle behind the increase, because it seems to me that in very broad terms we have here an increase at roughly the level of the RPI. As the noble Lord said, he wants to compensate those who fall victim of this awful disease at the rate that was available when, indeed, the Act was introduced by the
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previous Government. He wants to restore that rate. Therefore, although one might have said earlier—and I think that someone on the Liberal Benches in fact said it—that there might be a dead hand at the Department of Trade, in the Department of Employment this Christmas there is not quite a dead heart. It is right that we should try to do this.
My question is as follows. Does it mean, in broad terms, that the Government, at this late stage, have in fact accepted the principle of compensation for matters of this kind at the level of the RPI—that is, at the level of the rate of increase? That is my first and major question. My second question—and I apologise for not giving the noble Lord any notice of this, but it has only just occurred to me—is this. If that is accepted, and even if it is not generally accepted, for pneumoconiosis, would it not be better if we did not wait from 1979 to 1982 before we compensated? Because anybody who was subject to this Act and went for compensation under this Act some time between 1980 and 1983 presumably did not get compensated for movements in the RPI.
Therefore, would it not be much better—and could the noble Lord give us some indication of the Government's thinking on this—if the Government were to accept not simply compensation at the level of the RPI three or four years later, but in fact a process of annual indexation of this sum to keep it in line with the RPI?
Lord Hale: My Lords, I do not propose to waste time, as has been done previously, by explaining that I shall be very brief. I would prefer to carry on with my speech without any unnecessary trimmings. I personally want to congratulate the Government on this measure: on the way in which it has been handled, and on the way in which it has been presented. Originally, it was a joint Bill presented by both the great parties when it came before us in 1979, at the very moment when the trumpeters were cleaning their trumpets to blow the glad tidings of a general election. I believe that it was the very last act of the previous dying Government, and it was passed with the support of all parties.
The noble Lord, Lord Glenarthur, has been good enough to explain with great clarity and brevity the extraordinary problems which confronted the Government—problems that have never been confronted before in the whole tortuous history of workmen's compensation, industrial injury benefit, and so on. This was an attempt—a successful attempt—to deal with a very serious anomaly.
Because of decisions postponing the grant, the man suffering from byssinosis had to establish that he had worked in a given part of the industry for 10 years. Applicants could not make claims for benefit in time because of the limitation on claims. In many cases—particularly in fluctuating industries, such as textiles and so on—firms had gone out of business before the claims could be presented. So this Act attempted a legislative achievement and got it through by the interesting device of putting a non-existent word in the Title. So the word "etc." now governs these pensions as opposed to any other pensions.
With respect to my noble friend on the Front Bench, who referred to this disease, a number of diseases are

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covered by this—and I doubt whether even the noble Lord, Lord Glenarthur, could read them out offhand—because the word "etc." was designed to permit the Government to include diseases which had never before been scheduled and which had been popping up as genuine dust diseases in obscure little industries, where people were being caused suffering.
On the whole, this is a very successful measure indeed, although in another place it was subject to such criticisms as the short amount of time made available to discuss it. I understand that this measure is due to come into force on 1st January, and, therefore, may be submitted for a very early Royal Assent indeed. No doubt the measure has been considered by Her Majesty in its present form, because there may not be enough time for the Assent to be signalled.
I am obliged to the noble Lord, Lord Glenarthur. The result is, in the main, a 40 per cent. increase in the actual payment being made, and it gives a second chance in a large number of circumstances to many people who deserve a second chance. In those circumstances, I do not think that it is a good idea to quibble about a word, but one should express one's wholehearted thanks for something that closes a chapter in one's life.
In fact, it does not close it; there are other things to come. But those of us who have been interested in industrial diseases for over 50 years regard this as a moment to celebrate. I am sorry if I interrupted the noble Lord, Lord Lyell, who is normally very courteous, but I think that the noble Lord, Lord Glenarthur, set a proper practice by mentioning which order he was going to discuss before he started to discuss it.
12.50 p.m.
Lord Davies of Leek: My Lords, as somebody in the Department of Health and Social Security who had the privilege at the Front Bench in the other place some years ago to introduce for the first time a method of compensation for miners with pneumoconiosis, and known as old cases, and as someone who remembers well the pioneering work done with his skill in law towards improving pneumoconiosis compensation by the noble Lord, Lord Hale—and I suffered bullets from him myself when I was on the Front Bench dealing with this—may I say that both of us are delighted with this step forward. We are grateful for this 40 per cent. increase. It would be churlish of me today, in a brief three-minute speech, to try to find points and holes in this move forward.
Whatever anybody may say about the period when it was introduced, we are grateful that people who suffer will benefit as a result. However, there are three small points I should like to raise. There will always be danger, so long as people are running down the corridors of time, in hewing coal. As somebody who comes from farmers and miners and has witnessed the greatest explosion in the history of world mining at Senghenydd as a small boy in 1913, I know the human price paid by all types of men. This is a day to pay tribute to the medical profession, the mining industry, leaders in mining, and those lawyers and others who have helped us to understand how to compensate. I am watching the clock, so do not worry.
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I have recently been reading The Lancet and other information. There is no doubt that we have to make more progress in studying the problems of dust in the mining industry. I am glad that "et cetera" was placed there because, unknown to millions of people, workers in the tube train industry known as "fluflers"—those people who, while we are sleeping, work on the tracks of the tube trains of London, where there is asbestos wrapping and 10 times more dust than on the streets of London; a fact that is not well known—and people like that are coming into the compensation grades. This is not the place to develop it, but en passant I mention it so that at some time when we get the time attention will be given to that problem. Recent medical studies of an erudite nature in The Lancet which I read the other day are now declaring that, because of quartz in mining, the incidence of pneumoconiosis is more rapid. The quartz content is higher than previously thought, said The Lancet on 15th December 1981.
The last point, you will be pleased to know, is that prevention is being developed more than ever in the mining industry. The air stream air purifying helmet is a new device that we hope to encourage for the use of miners. As somebody who knows what hard work is with a helmet on, I know that the tendency is not to wear any device because of the difficulties of breathing. Having made my three-minute speech, and for once being able to congratulate the Government, I shall sit down.
Lord Energlyn: My Lords, it is appropriate that the noble Lord, Lord Glenarthur, is presenting these regulations this afternoon. Among his many talents and interests are geology and mineralogy, and pneumoconiosis is a mineralogical disease. Touching on the points made by the noble Lord, Lord Davies of Leek, it is not the cloud of dust that you see that is dangerous, it is those particles in the dust which are invisible which are the treacherous elements which lead to pneumoconiosis in all its varieties.
My first task on entering this field was to devise a method for identifying these invisible particles, such as the quartz referred to by the noble Lord, Lord Davies. I joined a distinguished group of workers in the early 1950s, and we led the world in our understanding of this disease, and in fact produced the proof which enabled the Government to replace the variety of names with the umbrella title of "pneumoconiosis". Here we are today aware of the variety of mechanical and pathogenic results which can emerge from the inhalation of particles.
Not all particles can enter the bronchioles and ultimately the alveoli of the lung and cause mechanical and subsequent pathogenic malformations and disease. Some are too large to enter and some are too small to remain within the body of the lung, and so we present the scientists and the medical men with a difficult problem of diagnosis of a hazardous atmosphere. We should therefore bear in mind the difficulties in the administration of a compensation scheme in which often it is a matter of opinion as to whether the atmosphere is hazardous or not.
Therefore, I welcome these tables, particularly because they recognise the fact that we could not prove in the early days that which we knew would emerge,

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that there would be a delayed action from inhaling dust in one occupation and the disease not showing itself until that person entered another occupation. We have had some outstanding cases of this kind. I should like to put on record my appreciation of the tolerant attitude of the National Coal Board to us scientists, who have been pointing this out to them. They have been tolerant, helpful, and so on. Embodied in this I see the equal tolerance as expressed by the noble Lord, Lord Glenarthur, on behalf of Her Majesty's Government, and sympathy that they have for these unfortunate victims of disease. Also, what I like about these tables is the clarification of the compensation that their relatives will receive. I congratulate the Government on this major advance in compensation under the umbrella title of pneumoconiosis.
Lord Edmund-Davies: My Lords, to one who spent a long part of his life both at the Bar and on the Bench dealing with the legal complexities arising from the assault of dust diseases, the regulations now under consideration come as a most welcome addition to the provisions which were belatedly made to deal with the horrible consequences of the various dust diseases. I warmly commend these regulations to the approval of the whole House.
12.58 p.m.
Lord Glenarthur: My Lords, I am grateful for the unanimous welcome that these regulations have received. That they come just before Christmas is perhaps fortuitous, but nevertheless I am most grateful to all noble Lords for their kind remarks. The noble Lord, Lord McCarthy—I think I got him right—asked about the relativity of the 40 per cent. to the increase in RPI over the period that the Act has been in force. The current rates of compensation came into operation on 1st January 1980. As I said, the new rates represent an increase of 40 per cent. and will restore the value of these payments to what they were when first calculated. It might be helpful if I pointed out to the noble Lord that the retail price index, for example, rose 32·9 per cent. between January 1980, when the present rates came into operation, and November 1982, so the 40 per cent. represents something over the increase in RPI in that period.
The noble Lord also asked me if I can summarise him correctly, why, it has taken so long to get the whole problem sorted out. The reason for that really—and I think it has been illustrated by what the noble Lord, Lord Energlyn, said just now—is that it is a highly complicated process. Not only is the Act itself complicated, but there is so much scientific work being carried out on the whole subject of dust-related diseases that unfortunately it has not proved practicable to introduce this compensatory legislation at this time. But it is being looked at the whole time. I cannot say that the review of the compensation will be fixed in any particular period—that it will be annual, for example—but it is a matter which my right honourable friend the Secretary of State will look at closely and regularly, and I hope that will give confidence to those who suffer from the disease.
I was pleased that the noble Lord, Lord Hale, was able to speak on this matter. He brings a great deal of
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personal experience to the subject, as does the noble Lord, Lord Davies of Leek. I shall not rise to Lord Hale's challenge and try to pronounce the names of the relevant diseases that come under it, because he is right to say that they are very complicated. As for the interesting words of Lord Davies of Leek on "fluffers", the subject of quartz and the purifying helmet, these matters will be studied seriously by all those involved in compensation, not only in the Department of Employment but in health and social security and all other aspects involved with injuries sustained in this way.
I was grateful for the remarks of the noble Lord, Lord Energlyn, about geology. I cannot claim to be in the same league as he, with his wide knowledge of the subject, but I, too, would welcome any help given by any industry towards trying to solve the problem. I know they are all greatly concerned, and of course it is not productive to them if their workforce is laid off because they suffer from these diseases, which are universally regarded as dreadful. I am grateful to the noble Lord for his helpful remarks.
On Question, Motion agreed to.

Employment Protection (Variation of Limits) (No. 2) Order 1982
1.2 p.m.
Lord Glenarthur Lord Glenarthur rose to move, That the draft order laid before the House on 6th December be approved.
The noble Lord said: My Lords, with permission, I will speak at the same time to the draft Unfair Dismissal (Increase of Compensation Limit) (No. 2) Order 1982. The draft Employment Protection (Variation of Limits) (No. 2) Order 1982 has been laid before your Lordships in accordance with Section 148 of the Employment Protection (Consolidation) Act 1978, which requires the Secretary of State for Employment to carry out each year a review of the limits relating to certain payments made under that Act. The limits are the weekly earnings limit laid down for the purpose of calculating redundancy payments, the basic and additional unfair dismissal awards and certain debts in relation to the insolvency provisions of the Act, and the daily limit on guarantee payments to workers on short time and temporary lay-off.
There are three factors which the Secretary of State for Employment has by law to take into account in carrying out this review and in reaching a decision. They are, first, the general level of earnings obtaining in Great Britain at the time of the review; secondly, the national economic situation as a whole; and, thirdly, such other matters as he thinks relevant. If the Secretary of State considers, as a result of the review, that any of the limits should be changed, he must lay before each House the draft of an order giving effect to his decisions; and where he decides that a limit should not be varied, he must lay before each House simultaneously with the order a report giving his reasons for not varying those limits.
As part of the autumn 1982 review, the Government consulted a wide range of organisations for their views of what changes, if any, should be made to the limits. In the light of these consultations the Govern-

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ment have decided that all the monetary limits covered by the review—that is, the limits of payments for redundancy, for basic and additional awards for unfair dismissal, for certain debts payable under the insolvency provisions of the Act and for guarantee pay—should be increased. The proposed changes, which I shall later refer to in more detail, are set out in the draft order. If the order is approved in both Houses, the changes to the limits will come into effect on 1st February 1983.
I mentioned the three factors which the Secretary of State must take into account in reaching decisions on the limits. One of these factors is the general level of earnings obtaining in Great Britain at the time of the review. The August 1982 figure for average earnings, which was the latest figure available at the time of the review, showed an increase of 7·8 per cent. over the previous 12 months. The figure for September 1982 is 6·8 per cent., and the figure for October is 7·3 per cent. If the level of earnings was the only factor to be considered, this would suggest that the limits should be increased by about 7 per cent. The Secretary of State, however, also has to take into account the national economic situation as a whole. Although the Government recognise the need to protect employees, they are also aware of the need, on the other hand, to keep within tolerable bounds the burdens which the employment protection legislation imposes on employers. The Government have therefore decided that increases in the limits of about 3·75 per cent. are the maximum increases which can be justified in the present economic circumstances.
The current weekly earnings limit for calculating certain payments under the Act is £135. The Government therefore propose that this limit should now be increased to £140. For redundancy payments, this means that the new maximum redundancy payment under the statutory provisions will be £4,200—that is, 30 weeks at £140—which will be the amount due to a man of 61 or over who has served 20 years and is entitled to 1½ weeks' pay for each year of service. The increased weekly earnings limit of £ 140 will also apply to certain payments made to employees under the insolvency provisions of the Act. The additional cost to the Redundancy Fund, from which such payments are made, is expected to be marginal for the year 1983–84.
Another of the payments subject to a weekly earnings limit is the basic award of compensation for unfair dismissal. I would remind your Lordships that this part of an unfair dismissal award is intended to reflect broadly the amount of redundancy payment which would have been received by an employee if he had been made redundant instead of being unfairly dismissed. For this reason, the Government consider that the limit for calculating the basic award should remain in line with the redundancy payments earnings limit. The new maximum in the basic award, therefore, remains exactly the same as the maximum redundancy payment of £4,200. The additional award which an industrial tribunal may award where an employer has refused to comply with an order to reinstate or re-engage a dismissed employee is also currently subject to a £135 weekly earnings limit, and this, too, is increased to £140.
Finally, I turn to the daily limit on guarantee pay. The Government propose to increase this limit from £9·15 to £9·50. Guarantee pay is payable for five days in a quarter, and the Government have decided that these limits should not be varied. The reason for this decision—that they still seem to strike a fair balance between the employers' obligations and the employees' rights—is given in the report which was laid before your Lordships at the same time as the draft order. To sum up, the increases take some account of the increases in average earnings, but are inevitably strongly influenced by economic and employment considerations.
I should now like to turn to the other order for which I seek approval, the draft Unfair Dismissal (Increase of Compensation Limit) (No. 2) Order 1982. This has been laid before your Lordships in accordance with Section 75(2) of the principal Act. It revokes the Unfair Dismissal (Increase of Compensation Limit) Order 1982, which set the limit on the compensatory award for unfair dismissal at £7,000, with effect from 1st February 1982. This limit is not subject to annual review under the principal Act, but it may be reviewed from time to time. Perhaps I ought to mention that, as in previous years, those consulted on the limits covered by the statutory review were also asked for their views on this limit. The Government propose that the upper limit on the compensatory award should be raised from £7,000 to £7,500 (an increase of about 7 per cent.) from 1st February 1983.
My right honourable friend the Secretary of State considered it appropriate that some account should be taken of the effects of inflation during the year. Furthermore, it is important to note that, whereas the weekly limit is used for the calculation of a basic award for unfair dismissal, the compensatory award is more closely related to the actual loss of the dismissed employee, and is therefore a truer measure of compensation.
In conclusion, I think that I should mention that the limit of £7,500 will apply not only to unfair dismissal compensatory awards, but to compensation which may be awarded by industrial tribunals in cases where complaints of discrimination under the Sex Discrimination Act or the Race Relations Act have been upheld. It is also relevant to compensation payable in cases involving unreasonable expulsion or exclusion from a trade union. I commend this increase and the order to your Lordships. I beg to move.
Moved, That the draft order laid before the House on 6th December be approved.—(Lord Glenarthur.)
1.11 p.m.
Lord McCarthy: My Lords, I am glad that I intimated to the noble Lord, Lord Glenarthur, some of the questions that I wanted to put to him, because at least he has given us a great deal of argument about why these particular increases in both of these orders are what they are. It is much better for the House and for us that we should have had that kind of answer than—I say this with respect—the kind of answer that we had when the noble Lord, Lord Lyell, was here and was asked a question that he could not answer. He took the view, well, if caught out, use a tennis analogy. At lease we have some figures, at least we have some

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arguments, but I have to say that they do not add up, they do not fit, and they do not convince.
Setting aside the complexity of some of the arguments put forward by the noble Lord, Lord Glenarthur, the situation is simple enough. We have here two orders, and the first order, which affects basically weekly earnings limits on short time, insolvency, redundancy, and so on, does not in fact give us the same percentage increase in each case. In fact, the percentage increases vary from a little above 3 per cent. to a little above 4 per cent. So if the same factors apply throughout these series of cases, why do we not get the same percentage? However, much more important than that is the point that, whether the percentage is 3·2, 3·75, or 4·21, it is very much less than the RPI. Yet we have recently had through this House an order, which we welcomed, in which the Government, admittedly three years late, have decided to increase a payment under an Act of Parliament by the full extent of the RPI; I refer to the pneumoconiosis order. We have another order here today, the second one, which relates to the maximum for unfair dismissal compensation, where once again, in very broad terms, for the period under review I calculate that the 7 per cent. increase which is being proposed is roughly in line with the RPI.
So that is the mystery, and no amount of argument about the economic state of the nation and the other factors can explain why each one of the proposals has a slightly different percentage increase and in fact the unfair dismissal proposal is covering the RPI while all the others are no more than 50 per cent. of the increase in the RPI over the period.
I suppose that the only argument that might have been put forward is that it cannot be afforded, either by industry or by, for example, the redundancy payments fund. But of course we know that many of the increases do not come fully from the employer concerned, and in any case so far as the overall effect of employment protection goes, in the Employment Act 1980 the Government removed altogether very large numbers of people from protection in the case of unfair dismissal.
So I do not feel that we can accept an argument that somehow there is a situation of national economic crisis, which means, I think for the second or third year running, that we cannot fully index weekly earnings limits and things of that kind, but we can index unfair dismissal compensation. Perhaps there might be another reason, which came right at the end of the remarks of the noble Lord, Lord Glenarthur, when he said that the maximum for unfair dismissal compensation affects unfair dismissal on grounds on non-unionism. Well, of course anything that has an effect on grounds of non-unionism must be made as high as possible!
Lord Kilmarnock: My Lords, I, too, should like to thank the noble Lord, Lord Glenarthur, for his very frank exposition of the basis of the Government's calculations. Having said that, I should simply like to add my voice to that of the noble Lord, Lord McCarthy, and to ask why the Government in effect adopted a double standard of indexation? The increase
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under the unfair dismissals order is just over 7 per cent., according to my calculation, whereas, as the noble Lord, Lord Glenarthur, has himself confessed, the increase under the redundancy order, under Section 148 of the Act of 1978, is only in the region of 3·75 per cent. Surely there cannot be any justification for the application of a double standard in those upratings. Finally, in view of what I think is an increase of just over 7 per cent. on the unfair dismissal compensation amount, I should like to ask the noble Lord whether in fact that constitutes the Government's forecast of the rate of inflation during 1983.
1.17 p.m.
Lord Glenarthur: My Lords, the noble Lord, Lord McCarthy, argues that the increases that are being made by the orders are not in line with inflation, and that anyhow the two are completely separate. Perhaps I ought to point out that, so far as the second order is concerned, the 7 per cent. does in fact broadly reflect inflation—the increase in the RPI, anyway—over the last 12 months. I can give him the figures, which I am sure he already knows, relating to the last 12 months. In October the figure was plus 6·8 per cent. and in November it was plus 6·3 per cent. So 7 per cent. is rather more than that. The answer to the question of the noble Lord, Lord Kilmarnock, about whether that reflects what inflation will do over the next year, is that inflation is going to be lower than that.
The two reviews that I have dealt with are completely separate, and there is no reason for the increases to be the same. The increase of 7 per cent. was thought appropriate, having regard to the effects of inflation on the type of loss to which this particular limit applies. The 7 per cent. increase in the upper limit on the compensatory award is higher because this award relates to actual loss, and not to average earnings. As I explained when I spoke to the first order, my right honourable friend the Secretary of State has to take account of the economic situation generally. Despite what the noble Lord, Lord McCarthy, might feel about it, it is essential that he does so, and this is what he does. I fear that the noble Lord may not feel that the awards are quite as generous as the awards made for pneumoconiosis. I do not think that for one minute he will deny that it is absolutely no one's fault, but rather just extreme misfortune that those who work in particular industries suffer from the dreadful disease of pneumoconiosis.
I hope that in the light of all the circumstances, and in the light of the need for my right honourable friend to take account of all the economic factors which make up the present situation, the noble Lord will accept that these are the best increases that could be made under these awards.
Lord McCarthy: Before the noble Lord sits down would it be fair for me to summarise what he is saying in this way: that the Government's view is that where you compensate for redundancy and insolvency you take into account the economic situation, but otherwise not?
Lord Glenarthur: My Lords, I think it would be a mistake to go back to discuss pneumoconiosis. We have, in fact, closed the book on that.
Lord McCarthy: I did not say that.
Lord Glenarthur: My Lords, that is the implication of what the noble Lord has said. The answer is that I have made it perfectly plain that the Secretary of State had to take into account various factors before making these awards, and these are the best that can be produced in the circumstances which pertain at the present time.
On Question, Motion agreed to.

Unfair Dismissal (Increase of Compensation Limit) (No. 2) Order 1982
Lord Glenarthur: My Lords, I beg to move this Motion formally.
Moved, That the draft order laid before the House on 6th December be approved.—(Lord Glenarthur.)
On Question, Motion agreed to.

Juries (Amendment) Bill [H.L.]
1.22 p.m.
Lord Wigoder: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Wigoder.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD OF NUGENT GUILDFORD in the Chair.]
Clause 1, [Disqualification of certain convicted persons for jury service.]:
On Question, Whether Clause 1 shall stand part of the Bill?
Lord Campbell of Alloway: At this stage it is not my wish to detain your Lordships with any debate on formal amendments to curtail the extended disability envisaged by this Bill, but, assuredly, at some stage this question warrants your Lordships' attention because on Second Reading some noble Lords wished to curtail the extent of disability envisaged by this Bill. In particular, I refer to the observations of the noble and learned Lord, Lord Elwyn-Jones, at column 602 of the Official Report for 17th November; but other noble Lords wished to extend it very substantially indeed. As an example, I refer to my noble friend Lord Elton at column 619.
A formal amendment would require some words of limitation to be inserted after the word "offence" in Clause 1, line 6, and possibly a schedule of exclusion. Would it not be more convenient if this question could be discussed at some later stage, preferably when the Government have formulated their own proposals and when one hopes, perhaps, that the noble and learned Lord, Lord Elwyn-Jones, may have crystallised some of his concepts for the assistance of some of your Lordships? Surely it would be wrong to rush such an important measure as this without full discussion on the extent of disability and all administrative aspects of its implementation in practice.
Lord Mishcon: The noble and learned Lord whose name has just been referred to is engaged at this moment upon other affairs, and apologises that he is not able to be with your Lordships. He is one of the more fortunate Members of your Lordships' House who has not therefore been detained until this moment and likely to be detained hereafter.
The noble Lord, Lord Campbell of Alloway, has quite correctly referred to the difficulties that are inherent in this matter. The Bill seeks to deal with a problem. Most of us feel there is some problem, and most of us feel that we have not reached the right formula and have not yet "crystallised" (to use the noble and learned Lord's word) our feelings, thoughts and philosophies on this matter. I find the view of the noble Lord, Lord Campbell, most acceptable in this sense: that at some stage or other very deep consideration has got to be given to the arguments for and against, if any formula can improve on the existing law. From that point of view I therefore agree with what the noble Lord, Lord Campbell of Alloway, has said.
Lord Elton: I think it might be useful if I were to use this opportunity to explain to the Committee the position of the Government on the Bill. I will not detain your Lordships for long. The siren calls not only for my noble friend's Second Reading but for the debate on the Unstarred Question set down by the noble Lord, Lord Mayhew; and, indeed, the Christmas Recess would make that perilous. As I made clear at Second Reading, there is very little between us and the noble Lord, Lord Wigoder, as to ends: each wishes to ensure that those who have shown their rejection of the essential values of our criminal justice system by their own way of life should be disqualified from jury service. We agree about ends, but we differ about means. The Government do not believe that the proposals in this Bill go wide enough. My noble friend was kind enough to point that out. Our own preferred approach would be to exclude from jury service anyone convicted of an imprisonable offence in the last ten years.
As some noble Lords may be aware, a Member in another place has introduced a Bill there to achieve this purpose. The Member concerned has drawn a low position in the ballot, but we shall clearly want to give him all the assistance we can. I do recognise, however, that the noble Lord, Lord Wigoder, will wish to proceed with his Bill, and, given our agreement on aims, the Government will not oppose it in its remaining stages in your Lordships' House. We are not now in a position to put forward substantive amendments of our own to the Bill, but we would not oppose any amendments that might be moved at later stages which were consistent with our own proposals, provided they were satisfactory and workable.
We shall also be pleased to make available to the noble and learned Lord, Lord Wigoder, the detailed drafting proposals for the Bill in another place as soon as they are available. In addition, I have drawn the noble Lord's attention to a detailed technical point in the Bill, which I gather he proposes to deal with later.
Lord Wigoder: I am grateful to the noble Lords who have spoken on this matter. It is very difficult to distinguish, I think, between a debate at Committee

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stage on "Clause stand part", where the clause is the only clause in the Bill, and a debate on Second Reading. Perhaps much of what has been said today could equally have been said—and, indeed, was said—when we had the debate on Second Reading.
I am grateful particularly to the noble Lord, Lord Elton, for indicating the view which the Government take. They still appear to adhere to their view that the proper course might be to seek to disqualify from jury service anybody who, within the last ten years, has been convicted of an imprisonable offence. It is the view of the noble Lord, Lord Harris of Greenwich, and myself, and many other people who have become involved in this matter, that this is far too wide an exception; that it is totally unacceptable to many of us who are deeply concerned about this matter; and if the Government propose to seek to proceed in that way, those of us who want something to be done will be forced into the position of resisting, and, in due course, opposing, the Government proposal.
I want to make that clear now because as your Lordships will know there is a Member in another place who has indicated that at the end of February he proposes to introduce a Bill on this subject. If that Bill proceeds on the lines the Government have indicated today, then that Bill is quite clearly doomed to total failure because under the procedures in another place it will obviously arouse opposition not merely from those who are disposed not to alter the present position at all but from those who, like Lord Harris of Greenwich and myself, are disposed and anxious to alter the present position but in a reasonable and moderate way. For that reason, I am grateful to the noble Lord for indicating his view.
Equally, it gives me a chance to suggest to the Government that the way to proceed to get something on the statute book (about which so many of us are agreed) is to take a moderate formula of the kind envisaged in the Bill, which will meet with very wide support. It will not arouse the vehement opposition of those who quite rightly will say that the Government's proposal will be a totally unwarranted interference with civil liberties and will exclude far too many people—all those who have on one occasion succumbed to sudden temptation in what may be a very minor matter—from jury service.
I ask the Government therefore to consider whether the way ahead is not to allow a Bill of this nature to go through as being a compromise solution which would have the effect of restricting jury service in the sense that it would exclude those who in ordinary parlance would be called criminals from serving on juries. It would mean that it would exclude, therefore, some people who otherwise it could be assumed would inevitably approach jury service with deep-seated and quite improper prejudices; and it would exclude from juries many of those who were so obviously susceptible to jury nobbling.
If we can exclude those people by some formula of this sort, I venture to think that the precise formula is not very important. Whenever we seek to draw the line in this matter—and I accept the point of the noble Lord, Lord Campbell of Alloway—there will be those
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who say it is a little too far one way and those who say it is a little too far the other way.
The important point is to proceed to draw a line in order to deal with an abuse that has now been so widely accepted and recognised. In those circumstances, I hope that your Lordships will agree that this clause should stand part of the Bill. I hope that in due course the Government will accept the argument for finding time in the other place for a Bill of this nature in order to get on to the statute book something of the sort that we all want to see achieved in the very near future.
Clause 1 agreed to.
Remaining clause agreed to.
House resumed: Bill reported without amendment. Report received.

Trade Marks Act 1938 (Amendment) Bill [H.L.]
1.34 p.m.
Lord Campbell of Alloway: My Lords, I beg to move that this Bill be now read a second time. As is apparent to your Lordships from the short Explanatory Memorandum, the intendment of this Bill is limited to the implementation of the recommendations which the Mathys Committee in 1974 made in paragraph 70 of their report. This committee included among its members eminent industrialists and lawyers having specialist expertise in all aspects of industrial property. If I may remind your Lordships, paragraph 70 of the report contains this recommendation:

(i) "That provision should be made in the Trade Marks Act for the registration of marks used or proposed to be used for distinguishing services offered in the course of trade or business.

(ii) That the provisions relating to marks for goods in the Trade Marks Act should apply so far as is feasible to marks for services.

(iii) That the prohibition of registration of identical and nearly resembling marks for services should apply in the case of closely related services.

(iv) That there should be provision for the refusal of marks for services which conflict with the same or nearly resembling marks already registered for closely related goods and vice versa."

The machinery adopted in this Bill to secure this intendment is to amend the Trade Marks Act 1938 following in substance—but not in form—the Australian precedent. The first draft of this Bill using the Australian precedent was prepared by my learned friend (as we say at the Bar) Mr. John Burrell, QC, who is chairman of the Industrial Property Committee of the Society of Conservative Lawyers. That is a committee that I set up some years ago and on which I still continue to serve as a member. It is right that your Lordships should know that this Bill is not introduced at the instigation of any association or at the behest of any sectional interest. The way it comes before your Lordships' House is the way—perhaps a rather haphazard way—that I have described. There is no political motive whatever. But, since its introduction in this rather curious way, it has, as I shall inform your Lordships, received unsolicited very substantial support.
The scope of this Bill is strictly limited to the intendment, the simple single concept, of

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implementing paragraph 70 of the Mathys Report to which I have referred. In the list of speakers today noble Lords from both branches of the legal profession are to speak on a plane which transcends party political considerations. Other noble Lords with practical experience of industry are also to speak. It would be wrong—and I do not propose to do it—to anticipate such measure of support as this Bill may be given. It is however, as I mentioned before, only right that your Lordships should know that, since its First Reading a short time ago, the Bill has received unqualified support—and I have the documents in my possession if any noble Lord wishes to see them—from the Trade Marks, Patents and Designs Federation, which represents the owners of industrial property in British industry; the Association of British Chambers of Commerce; the Institute of Trade Mark Agents; the Institute of Directors; the CBI and other associations.
Why is this so, my Lords? It is because—as they appreciate—if we delay and wait for the European Community legislation and for the Bill which must follow such legislation, the owners of service marks which are at present not registrable but would be under this Bill will by, say, 1985, 1986 or 1987, have lost priority against other countries in Europe since no prior registration of these marks will exist in the United Kingdom. No doubt, in say, 1985, 1986, 1987, or 1988, the whole system of trade mark law must come under review, leading to some new consolidating Bill to implement the European Community legislation. But this in no way detracts from the case for this Bill: indeed it enhances the case for immediate legislation. Furthermore, as the Trade Mark Registry is now being reorganised under the Rayner studies, there is, in submission, no reason why service marks should not form part of such a reorganisation.
In that context, it is right that your Lordships should know that correspondence with the department, which I have in my possession, shows that although an increase in style would be required in the registry, which could provide perhaps a little employment for some of the unemployed, an all-round increase in fees for goods and services would avoid the need for subsidy on account of any additional expense. That is in an exchange of letters which I have in my possession. This was based on the anticipated 3,000 applications a year for the registration of service marks, as compared with about 17,000 a year for goods.
I informed your Lordships that the scope of this Bill was limited to the intent, as it assuredly is. The scope is limited to ordinary marks. No amendment is contemplated in respect of certification marks, defensive marks and cotton marks. The amendment relates only to registrable trade marks now limited to goods, and in no way affects the criteria of registrability, distinctiveness and so forth, laid down in the master Act.
The case for this Bill is not limited to European Community considerations, which demand the immediate introduction of this type of protection. It also arises quite apart from such considerations. May I deal first of all with the European Community position. As your Lordships know, but with your permission perhaps I may remind you, the majority of
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the industrial countries of the world—Australia, Canada, the United States and 64 other states including the USSR, four member states of the European Community (Denmark, France, Italy and Germany) and Benelux legislation will be in probably by the end of 1983 or January 1984—now provide for registration of service marks in their national legislation.
The absence of such a facility in the United Kingdom not only places the service industries at a disadvantage with manufacturing industry but also is especially detrimental to our interests when the Community trade mark is introduced in the years ahead, for the reasons that I have given. It is of importance to repeat that under the commission's proposals a trader will not be permitted to oppose an application for Community registration unless he has a national registration, which is exactly what this Bill seeks to provide. Thus the creation of a United Kingdom service trade marks register is no less than essential to place British service industries in a position to protect themselves and their goodwill when the Community trade marks system in the years ahead comes into force.
It is perhaps unnecessary to stress to your Lordships the importance of the service industries to our economic survival and revival. It has been mentioned so often in your Lordships' House. Since the Mathys Report in 1974, starting in 1978. representations have been made to the department, all to no avail. In June 1980 the Institute of Trade Mark Agents submitted a memorandum to the department seeking amendment of Section 68(1) of the Act of 1938 to this end (see page 6 of their memorandum)—all to no avail. On 17th November 1981 representations to this effect were made to Sub-Committee "E" on the introduction of legislation on service marks well before any EEC law on European trade marks was to come into force (see paragraph 167 of the transcript of evidence).
On 9th June 1982, with the leave of your Lordships' House, I asked Her Majesty's Government when it was proposed to implement these recommendations of the Mathys Committee concerning the registration of service marks in line with the practice now adopted in other countries, some of which were Commonwealth countries and some of which were Napoleonic code countries, many of which were our competitors. It was accepted on all sides of the House that there was a case of urgency. I refer in particular to the support of the noble Lord, Lord Lloyd of Kilgerran, whose expertise on this subject is again available for the assistance of your Lordships today. I refer also to the support of the noble Lord, Lord Davies of Leek. I see that he is again to assist us in this matter, as is the noble Lord, Lord Spens.
Apart from some perhaps irrelevant exchanges about the export of oil, the views expressed on the subject of the question were clear and unequivocal: the Hansard reference is vol. 431, No. 100, cols. 193–6. It was perfectly plain that the mood of the House sensed the urgency; but all to no avail. My noble friend Lord Cockfield, while not opposing implementation of the Mathys Report in principle, rejected the case of urgency on the grounds that a draft regulation and a draft directive on trade marks had recently been

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published by the European Commission. But, with respect to the noble Lord, it was a total misconception to seek to oppose the mood of this House, as expressed on that occasion, on those grounds.
First, why wait until four other member states had gone ahead and a fifth was to come? Secondly, how long do we need to wait anyway? Thirdly, while we wait our service industries suffer the disadvantage to which I have adverted. Fourthly, the intellectual argument of my noble friend the Minister is simply not understood. Fifthly, what about the matter that I am coming to swiftly in one moment—the case which arises quite apart from European Community considerations?
The case which arises, apart from Community considerations, is simply stated, and is really that those who operate these services should be enabled to have the like facilities as exist in the case of trade marks to protect their industrial property, so that an action would be based on registration and would avoid the complex procedures and evidential criteria necessitated by the more expensive common law action for "passing-off'. Furthermore, many businesses are simply not large enough to justify the expense of Community registration and others will not require such wide territorial scope, because they are essentially local in character—such as hotels and travel agencies. The existing system is wholly anomalous and there is a valid case for the introduction of national registration of service marks, which this Bill would secure, quite apart from Community registration.
In conclusion, I should like very briefly to explain, as is explained in the Explanatory Memorandum, the situation that arises under the Nice agreement. I have the documents here and they will be available for your Lordships to peruse in the Library, if so advised. It will be for the Department of Trade to prescribe the necessary rules, classifications, procedures and so on which are applicable to the registration of service marks. This is provided for by amendment of Section 40 of the Act of 1938. The Department of Trade will have power to make rules, so as to empower it to classify services in accordance with the Nice arrangement of 1957 concerning the international classification of goods and services to which the United Kingdom is a party.
There were 15 signatories to the Nice agreement and these included four of the six who had set up the Common Market, and the United States of America. This agreement was concluded in Nice in June, 1957; it was revised in Stockholm in 1967; it was revised again in Geneva in 1977, and this is the latest state of the international classification. Your Lordships will find Parts I and II of that classification in the Library. The third edition has over 1,250 services. This is the current 1981 edition. The classification is in English and French, both texts having equal authenticity. This will be modified and supplemented from time to time by the Committee of Experts; and the fourth edition is in course of preparation.
Part I of the classification has four columns—column 3, the English; column 4, the French; column 2 giving the serial numbers of the indications in English, and column I giving the key to Part II where
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the lists of services are arranged in class order, each class being arranged in alphabetical order. I hope that I have indicated to your Lordships sufficient of the nature of the situation. All that I have to mention is that the transposition of the Australian first draft, to get it into the form in which it is before your Lordships—in other words, the right way up—involved, first the correction slip which your Lordships have and also a formal amendment with an extra five lines of paragraph 10 to the end of the schedule. My Lords, I beg to move.
Moved, That the Bill be now read a second time.—(Lord Campbell of Alloway.)
1.55 p.m.
Lord Mishcon: My Lords, I think your Lordships will feel that this is a useful little Bill. It is one that is very suitable as a Private Member's Bill and it has been presented to us by the noble Lord, Lord Campbell of Alloway, with his usual clarity and persuasiveness and in the typical tones of Father Christmas. I shall try, as a non-specialist in this field, to use simple language in endeavouring to support the Bill, the object of which is very short and it is this. The Trade Marks Act 1938 covers goods which are used in trade and many people, such as those who are specialists in this field, the professions and other people engaged in services—which, as your Lordships have rightly been reminded, are so vital to our economy, both in regard to foreign currency earnings and to our own home market—have thought for a long time that these services should also be included by way of protection and control in trade marks legislation.
As your Lordships have been told, it is no new proposition. The Mathys Report was issued eight years ago and it made the recommendation in, I believe, paragraph 70 which was quoted by the noble Lord. Therefore, I do not intend to burden your Lordships with a re-quotation of that paragraph. Why is it that we move so slowly in regard to carrying out recommendations which have such universal support among those people who are affected? As I said, the report came out eight years ago and this Bill would be merited, even if there were no question of any draft EEC directive or regulation. Nothing has been done about it and, very regrettably, other countries are in advance of us. Why should they be in advance of us? Why should four other members of the EEC and 60-odd other industrial countries be in advance of us? Why should the United States and even the USSR be in advance of us? Why are we so slow in moving to legislate, even on simple matters like this?
As your Lordships have been told, there is a draft directive and a draft regulation. They have been tossed around and observations have been made, and our own Sub-Committee E of our EEC Committee has dealt with them. We know that the EEC directive and regulation will be laid in the not too distant future, and they will be to the effect that we shall have to legislate in order to deal with various matters relating to trade marks. One of those matters will be the inclusion of services for trade marks protection. Is it sensible to wait until the final EEC directive and regulation come before us?
In support of what the noble Lord, Lord Campbell of Alloway, has said, I suggest that it would be

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senseless and most disadvantageous to wait. The evidence was given clearly to Sub-Committee E. Perhaps I may read a short quotation from the evidence given to Sub-Committee E, who will be reporting very shortly. I am a member of that subcommittee and can tell your Lordships—I do not believe I am saying anything improper—that there will certainly be nothing in the recommendations to suggest that it is not a good idea for a Bill of this kind to be passed by your Lordships' House.
The evidence which was given to the sub-committee was very clear. It was given by the appropriate institutes which govern trade mark agents, the Chartered Institute being one of them. I quote from Question 167:
"We would like to see that legislation come in well before any EEC law for European trade marks, both so that the service marks are in the register as registrations that can be used in opposition, and so on, and also to give the United Kingdom some experience of administering and dealing with service marks generally, especially if the United Kingdom is going to be the home of the European Trade Mark Office".
Those who know about these matters are pleading, even without the recommendation that was made eight years ago in the Mathys Committee and what has been said since, and even with regard to the EEC directive and regulation, that we should get a move on and legislate about this matter; that experience is needed of a national register of trade marks in relation to services; and, much more vital, that when EEC legislation is brought into effect, people want, as holders of registered trade marks, to be able to oppose trade marks relating to services which may exist elsewhere, because if they are not on the register they will be unable to do so. That is what the draft directive and regulation says. When I see the noble Lord, Lord Campbell of Alloway nodding his head in assent, I know that I have said something sensible.
In those circumstances, this is a good Bill to support. When the Government reply, I hope very much that we shall not be fobbed off yet again with a request to wait. I am reminded of the gracious voice—as it was—of the first Viscount Samuel, who sat with such eminence on the Front Bench of the Liberal Party. At a meeting I attended which honoured the centenary of the modern civil service I remember so well that on that occasion the speakers were somewhat lugubrious. Certainly they were very serious. In paying his tribute to the Civil Service for all that they had done to make his career so illustrious, the noble Viscount said that he would always remember them for one thing: that they have a problem for every solution. We can easily find a problem for this solution. The problem is the cost. The noble Lord, Lord Campbell of Alloway, dealt with that. I am not going to repeat what he said. It could easily be dealt with by charges and possibly would give a little extra employment at this time, as the noble Lord said.
It may be asked whether or not we should wait for the EEC directive and regulation to be finalised. I hope that question has been answered by what both the noble Lord, Lord Campbell of Alloway, and I have said. Instead, therefore, of delaying or vague words being spoken this afternoon on behalf of Her Majesty's Government, I very much hope that this Bill will be given a welcome by the Government and that they will see that it has a favourable wind in order to get it on
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to the Statute Book. It will be a valued addition to the Private Member's Bill history of this Parliament.
2.5 p.m.
Lord Lloyd of Kilgerran: My Lords, in warmly supporting the Bill, first may I congratulate the noble Lord, Lord Campbell of Alloway, upon his initiative in introducing it. I am sure that the noble Lord, Lord Cawley, who I am so pleased to see in his place, will join with me in saying how glad we are to welcome into this exotic field of trade mark law so many noble Lords on this, the last day before the Christmas Recess.
The noble Lord, Lord Mishcon, has indicated that this is simple Bill; but it is a very important one. I do not propose to go fully into these matters, in view of the speeches of the noble Lord, Lord Campbell of Alloway, and the noble Lord, Lord Mishcon. The Trade Marks Act 1938 has been a very important tool, and has been of great use to industry. It has its faults, but it has never been amended. That shows what a useful tool it has been. It has been with us for 44 years. But difficulty arose in 1945. It came as a great shock then to practitioners in the trade mark field and to industry when the Judicial Committee of the House of Lords refused to allow the registration of the word or mark "Rysta" because the company claiming registration only repaired stockings of other manufacturers and did not themselves offer, and did not intend to offer, any goods on the market. The decision turned on a very narrow interpretation of the words "use in the course of trade".
If I may mention a personal matter, my late uncle was then the Registrar of Trade Marks. It was his decision to allow the registration of "Rysta" for repairing stockings which was reversed by the House of Lords. He was very perplexed about that narrow decision. He had a dual interest, because he himself played a great part in drafting the 1938 Act. Since 1945, therefore, the wrongful use of a mark or word in association with services could only form the basis of an action for passing off, and actions for passing off are usually very expensive in view of the amount of evidence required to present the case.
From time to time suggestions were put forward to remedy this position. Service marks became the subject of statutory rights in many countries, as your Lordships have been told. We had the Mathys Report and, so far as industry is concerned, the importance of service marks has increased rapidly in the last decade. More and more people are employed in service industries. Many people have forsaken manufacturing industry for service industries, as must be well known to your Lordships. The Government have encouraged this development, particularly in the field of information technology, where the energetic action of the Minister for Industry and Information Technology, Mr. Kenneth Baker, and his deputy John Butcher have done such splendid work.
If any evidence is required of the importance of services in that field and of the fact that increasing employment is arising in the field of information technology, may I draw your Lordships' attention to the publication I hold in my hand, which is the first issue of a new journal on information technology and

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public policy published by the Parliamentary Information Technology Committee—affectionately known as PITCOM—of which I have the honour of being a founder member. This is the first publication issued by any all-party parliamentary committee on a regular basis, as I understand it, and it includes a number of articles based on speeches made to the committee during the last 18 months, which show how important service industries are now becoming. Therefore, it is increasingly important that service marks shall have statutory protection.
While this Bill in its present form is very useful, I should draw the attention of your Lordships to a matter to which the noble Lord, Lord Mishcon, referred and which may be relevant at Committee stage. It is very desirable to form an official register of trade mark agents. The EEC trade mark procedures will require a list of trade mark agents and therefore it is necessary to have a register of trade mark agents of this country. I am very familiar with the high standards of examinations which trade mark agents in this country have to pass. I would also like to see fully qualified trade mark agents allowed to participate before certain courts in the same way that chartered patent agents are now allowed to participate, arising from amendments inserted into the Patents Act 1977.
I will refer briefly to developments in the EEC. The noble Lord, Lord Mishcon, emphasised how vital it is to have statutory protection for service marks in the United Kingdom Act before the EEC trade marks Act is passed. Industry in this country is bound to suffer if the Government decide to postpone action implementing this Bill until the trade marks Act of the EEC comes forward. If that step is not taken by the Government, industry in this country will suffer because of loss of priority in regard to date. It would in those circumstances be quite possible for persons in countries of the EEC to register now some service marks well known in this country—for example, "Telecom"—and thus deprive British industry of the right to use such words, because of their prior registration. It is essential, in the harmonisation of trade marks law which the EEC's draft Act contemplates, that this country should give statutory protection to service marks.
Obviously, after 44 years, the Trade Marks Act 1938 requires certain other amendments in order to bring it up to date. I do not propose raising any further matters in regard to improvements to trade marks law at this stage. The noble Lord, Lord Campbell of Alloway, has indicated that there are other aspects which might be seen to later but not during consideration of this Bill.
2.14 p.m.
Lord Noel-Buxton: My Lords, I rise to support this Bill and to suggest some further amendments which could usefully be made to the Trade Marks Act 1938 at this stage. I might possibly differ very slightly from the noble Lord, Lord Lloyd of Kilgerran, in this respect, but I think he may agree with me that my proposed amendments are of a minor nature and could not and will not overload this Bill.
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English statute law should indeed recognise that it is appropriate and desirable for trade marks to distinguish services as well as goods. I welcome a Bill which seeks to effect this in such a straightforward manner. It seems to me totally unreasonable, indeed absurd, that the protection afforded by the 1938 Act should extend only to marks applying to goods, and then only in the course of trade, as contrasted with business, and not also to service marks.
The number of undertakings offering services must be of the same order as the number of undertakings manufacturing goods. I do not have the figures, but I suspect that the number of service undertakings is far greater. I, too, find it totally unacceptable that so much of British industry is so disadvantaged—for substantially disadvantaged it is. At present, an undertaking using a name, device or other mark to distinguish its services from other services offered in the course of trade or business cannot register that mark. It is not open to the undertaking offering services to pursue an unauthorised user by way of trade mark infringement action; service undertakings can only rely on the common law action of passing off.
Anybody with only a passing acquaintance, even, will confirm the difference between a trade mark infringement action and a passing off action. The former is relatively straightforward, while the latter is onerous and complicated. I remember the noble Lord, Lord Mishcon, making a similar point so eloquently on the Second Reading of the Companies (No. 2) Bill. As the noble Lord confirmed, to create a valid action in passing off places a very heavy onus on the plaintiff, especially if he is in business in a small way.
Many of my foreign clients have expressed surprise when I have had to explain to them, counter to their expectation, that the law in this country does not in effect recognise service marks. The United Kingdom is out of line with other advanced legal systems in this regard. Many countries provide for direct registration of service marks on their trade mark registers. My noble friend Lord Campbell of Alloway gave us a very impressive list. The United Kingdom was—and it should be emphasised again, I think—a party to the 1957 Nice agreement, under which an international classification of goods and services was issued. It is high time that the law of this country recognised service marks and the need for them to be capable of registration essentially in the same way as trade marks relating to goods.
The Trade Marks Act 1938 provides that, subject to its provisions, a trade mark may be registered if used or proposed to be used in the course of trade, and a registered trade mark is infringed by unauthorised use in the course of trade. I see no good reason, however, why the protection afforded should be restricted to activities strictly in the course of trade, as contrasted with the wider concept of business generally. The noble Lord, Lord Lloyd of Kilgerran, gave us a splendid and an early example of the strict interpretation of the Trade Marks Act 1938.
The Explanatory Memorandum relating to the Bill before your Lordships, which follows the recommendation of the Mathys Committee, speaks of a series of amendments to the 1938 Act so as to ensure that the relevant provisions apply equally to service marks

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used in the course of trade or business. I hope that the addition of the words "or business" reflects the intention in this matter. My noble friend is nodding.
Marks, be they service marks or marks used to distinguish goods, should be the proper subject-matter of registration and infringement proceedings if used in the course of trade or business. I would illustrate my point by an example. I know of at least one well-known charity which seeks to use trade marks extensively in its fund-raising activities. It cannot be said to be conducting itself in the course of trade, but it is certainly conducting itself in the course of business. Are such charities and other undertakings conducting themselves not strictly in the course of trade to be denied the protection of trade mark registration effectively on a technicality? The position should be put beyond doubt by the insertion, where appropriate throughout the 1938 Act, of the words "or business" after the word "trade".
Two other amendments could usefully be made to the 1938 Act without overburdening it. They could be added to the schedule to this Bill. First, and again as recommended by the Mathys Committee, Section 68(1) of the 1938 Act should be amended to define "trade mark" in a much more satisfactory manner. "Trade mark" should be defined along the following lines—and these are the words of the Mathys Committee:
"A mark used in relation to goods or services so as to indicate a connection in the course of trade or business between the goods or services and some person having the right to use the mark".
Secondly, the anomaly that the benefit of a trade mark application cannot be assigned should be put right. Section 22 of the 1938 Act should be amended by deleting subsection (7) and inserting a provision whereby an assignee may be substituted as the applicant for the original applicant.
I fully support the Bill in its principal purpose. I hope that with some further amendments and some fine tuning the Bill will reach the statute book. To this end I trust that the Government will in the event see their way open to lending such assistance and support as may be necessary.
2.22 p.m.
The Duke of Portland: My Lords, I wish to draw your Lordships' attention to the advantages which the purchaser of services will derive from the Bill. A service mark will provide an indication that the holder of the service mark is, presumably, reliable and anxious to give a high standard of service in order to maintain the prestige attached to his service mark. Thus, if someone wishes to have his car serviced, he will give preference to the holder of a service mark rather than to some garage of which he has had no experience and which might prove to be excessive in its charges and unreliable in its work.
There is another example. A person wishing to have a bath shower installed may entrust this task to a plumber bearing a service mark, and the work is done satisfactorily. Another person instructs a casual plumber to perform the task, with the result that the bath shower does not function satisfactorily and it is probably the manufacturer who gets the blame.
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Fifty years ago services had not assumed the importance that they have today, when they are described on the BBC as a service industry. This, I believe, is largely due to the fact that machinery of all sorts has become more and more complicated. Fifty years ago I would have felt capable of carrying out minor repairs to my car. Today, the mechanism is so complicated that I can do no more than lift the bonnet. Your Lordships have heard of the advantages of this measure for the purveyor of services, but I submit that it will also help to safeguard the interests of the purchaser.
2.25 p.m.
Lord Davies of Leek: My Lords, I have listened to this debate with great interest. Indeed, I can cut out about 50 per cent. of what I had planned to say because it has already been said, and I would not like to see a repetition of some of the excellent speeches that have been made by knowledgeable noble Lords. However, I want to make a contribution based on the report and to mention that there are other types of services. Also, if we were playing molecular roulette in pharmaceuticals there would be another aspect and that is the need for co-operation with Europe, Japan and those parts of the world that are developing in that field. I would particularly have liked to see a small addition. Incidentally, I am glad to note that we have now got the correct pronunciation of the name "Mr. Mathys". I was rather worried about that.
On page 76 of the report there is the heading:
"Proposals for a Standing Advisory Committee on Trade Mark Law and practice"—
and I would now add,
"and Services".
It is worth getting this on the record. Page 76 continues:
"The Trade Mark Liaison Group should be re-formed as a Standing Advisory Committee on Trade Mark Law and Practice which would be available for consultation by the Government as required.".
I think that the Government need consultation because of the multifarious services that have been developed and the movement in the electronic world as regards new patents and new ideas. Unless we pull up our socks—to use a colloquial expression—we shall be left behind by the Europeans, and also by other parts of the world. There is a need now to get into the lists, and, as has been recommended by the noble Lord who opened this debate, to develop our activities, so that we are there with knowledgeable information when new organisations are established in Europe.
I should like to mention one passing thought and then I shall sit down, because most of what I wanted to say has already been said. The passing thought is this: please let us have some idea how a man can protect himself, either with his service marks or with his trade marks, without colossal expense. If we believe in encouraging the small businessman, then this is an area that is of vital importance to the little man—and I use the phrase "little man" metaphorically. The little man, if he has to go to law as regards the protection of some of his little patents or something else, needs to do it successfully but within a range of finance that he can meet without being bankrupted. What more can I say that has not already been said?—nothing, so I will sit down.
2.28 p.m.
Earl De La Warr: My Lords, like the noble Lord, Lord Davies of Leek, I feel that all the arguments have been adduced, and adduced extremely powerfully, particularly by my noble friend Lord Campbell of Alloway, who I am glad to say has introduced this Bill. The reason that I have taken some interest in it is that for the best part of my life I have been engaged in working in service industries. I was employed for a long time by a very large conglomerate whose name some of your Lordships will know, and about 90 per cent. of whose companies were service companies stretching from passenger transport to entertainments, to Wembley Stadium, to plant hire, to laundries. One could almost say: you name the service, we have it. It is for that reason that I thought that I should take an interest in this Bill. Accordingly, in order to bring myself up to date, I went to discuss the matter with some of my old friends.
It might help your Lordships' consideration of this Bill if I give your Lordships one example from an associated company—namely, Initial Services, which is a textile rental company. The nature of their business is that they rent out towel cabinets and keep them serviced with clean towels every week; they rent out linen garments to girls in factories, which they design themselves, and take them back, wash them and trim them. They are involved in industrial overalls and, to a growing extent, they are in office cleaning. Thirty per cent. of their business is overseas, carried out through subsidiary companies all over Europe, in Australia and the Far East. They have been keenly aware of the need to protect themselves as a service company.
About a year ago they started to see what they could do about it, but, try as they would, they came to the answer that your Lordships will expect, and were told that there was no way that they could register their mark as a service mark, and that they would have to depend upon common law. So they did the only thing they could, which was to register the one piece of machinery which they have, which is the towel cabinet—from which your Lordships will have drawn lengths of towel in order to dry your hands—and thereby accepted that all that was available to them was the trade mark on goods.
However, they did not stop there because they were so anxious to protect themselves in these matters that they began to register service marks in the countries in which they had subsidiaries. They have already registered in France and I believe that it is their intention to register a service mark wherever they trade and wherever the service mark is available. I can only say that their reasoning is exactly the reasoning that we have heard from your Lordships this afternoon, but I thought your Lordships would like to know of a specific example of a company which feels that it needs protection and is worried about what will happen when the Community mark comes along.
We have heard that 64 countries have already done this. It is eight years since the Mathys Report was published. I find it extraordinary that successive Governments have succeeded in putting this important trading matter into their bottom drawers. There have been constant approaches and constant
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excuses as to why they cannot proceed and I daresay that the excuses have varied through the years. Probably the one that we shall get this time is the arrival of the Community mark; but my noble friend Lord Campbell has dealt very adequately with the inadequacies of that.
I should just like to say one more thing and, if I may be so impertinent, I should like to offer the Government a bit of advice and something of a warning. There are many trade associations which understand these affairs; there are a number of intelligent companies which understand them; but it is a fairly esoteric subject. It is not the sort of subject that comes up at board meetings once a month, and up to now a great many service companies have not been aware that there is legislation of this sort that could come on to the statute book to give them protection of this sort.
I want to warn the Government that, as a result of this debate, there will, I am certain, be a volume of pressure which is altogether greater than anything that they have known in the past. For the reasons that have been given, and also, if I may say so, for the reason of their own self-protection, I think that they would be very well advised to take this Bill seriously and not only see it through this House but make sure that it ends up on the statute book.
2.35 p.m.
Lord Cawley: My Lords, I rise to support my noble friend Lord Campbell of Alloway. This is an amending Bill. It amends the Trade Marks Act 1938. Therefore, I thought that it was a suitable moment to say one or two things about that Act. The noble Lord, Lord Lloyd of Kilgerran, has said some somewhat flattering things about that Act, but I think he has been looking at it through rose-tinted spectacles. It is an open scandal that it has not been amended.
When it was quite a young Act in 1940, on 9th May, the important section that deals with infringement came before the Court of Appeal. Lord Justice MacKinnon said this:
"In the course of three days' hearing of this case I have, I suppose, heard Section 4 of the Act of 1938 read, or have read it for myself, dozens if not hundreds of times. Despite this iteration, I must confess that, reading it through once again. I have very little notion of what the section is intended to convey and particularly the sentence of 253 words, as I made them, which constitutes subsection (1). I doubt if the entire Statute Book could be successfully searched for a sentence of equal length which is of more fuliginous obscurity".
For the benefit of your Lordships who do not usually use the word "fuliginous", it means "sooty, or dusky".
The Master of the Rolls said this:
"Nor must the fact that the language used is crabbed and involved deter the Court from endeavouring to discover its meaning. Every Act of Parliament must be approached with the conviction that its language is capable of a reasonable construction when carefully examined".
I make no apology when I tell your Lordships that this is the second time that I have read the learned Lord Justice's remarks in this House, but the first time was so long ago that I think that a majority of the noble Lords who heard them then are dead and a new generation has arisen, so I thought it apposite to mention them today.
The difficulties in interpreting this Act go further, because about 30 years ago I read a paper to the

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Chartered Institute of Patent Agents entitled "Trade Marks wrongly Remaining upon the Register". That dealt with the circumstances in which a trade mark, validly registered, could become invalid in the light of later events. The provisions in the Act are anything but clear, and my paper was full of my own views which might, or might not, agree with the future judicial construction of the Act.
Five years ago next month, I spoke on the Second Reading of the Patents Bill and remarked on the greater necessity for a new Trade Marks Bill since the earlier Patents Act was passed in 1947 whereas the Trade Marks Act had been passed in 1938. I think I may repeat what I said then because I think it is apposite again today. I said on 24th January 1977, at col. 289:
"In a country depending on industry any Bill to reform patent law after 27 years is certainly welcome … I should like to point out that though patents are vital to industry, so are trade marks, and the last Trade Marks Bill was in 1938, which is 39 years ago. Many industrialists think that trade marks are far more important than patents, and I hope that we can have the assurance that in the near future there will be a Trade Marks Bill. I say this not from any partisan standpoint because I think that this side of the House has been equally as remiss as the other side in not dealing with these matters, which are so important to industrialists".
The Lord Chancellor of the time, the noble and learned Lord, Lord Elwyn-Jones, replied:
"The noble Lord, Lord Cawley, raised the point that it was important that there should be a Trade Marks Bill also. I agree that it is important, but I am afraid I can make no promise that such a Bill will be introduced, and I will tell the noble Lord why. Negotiations are now taking place for the establishment of a Community trade mark. I think the noble Lord will probably agree with me that it is important to get that right so that whatever changes we may make will harmonise with Community proposals".
Five years later, I do not agree that further procrastination is acceptable. The Bill before the House today does harmonise with Community proposals. Let us make an important and, to some industrialists, a vital improvement to trade mark law now. Real damage is imminent for some industrialists unless we do this. Any statement that there will be a new comprehensive Trade Marks Bill within the foreseeable future would obviously be somewhat hollow, and, if the present timetable is adhered to, I shall be in my mid-90s when I rise in my place to congratulate a future Government on introducing such a Bill. I urge my noble friend not to withdraw the Bill at this stage.
2.42 p.m.
Lord Lyell: My Lords, I am sure your Lordships will agree that my noble friend Lord Campbell outlined with the traditional clarity of his calling and profession and with real passion and feeling the purpose of his Bill and his reasons for seeking an amendment to the present Trade Marks Act. I wish to stress at the outset that the Government recognise the vital importance of the service industries to the economy of this country and fully understand and appreciate the valid reasons that have led my noble friend to introduce his Bill. He pointed to the fact, as did many other speakers, that service marks cannot be registered in this country, unlike many other countries. However, I stress that, unlike many other countries, we have the benefits of our common law, and service marks are forcefully protected under the common law.
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We would not dispute that it is more convenient for a company involved in trade mark litigation to proceed by way of an infringement action based on a registered mark rather than a passing-off action under common law. But if those industries were hampered by the absence of registration facilities, we should have taken action before now. As it is, we consider that action taken immediately would be premature, for reasons I shall elucidate.
My noble friend drew attention to the report of the Mathys Committee and, as noble Lords will be aware, they recommended, among other things, that provision should be made for the registration of service marks. We are of the opinion that the recommendations have been largely overtaken by Community proposals, which are certain to result in fundamental changes to our law, and that includes, of course, trade mark registration. These Community proposals are, as noble Lords will be aware, already contained in a draft regulation and directive. Under the regulation, a single application to the Community Trade Marks Office would result in a single Community trade mark covering the entire Community. The national systems would co-exist with the Community system, but in order to ensure that they are in step with the Community system, the directive provides that the criteria for registration and validity, as well as the rights conferred by registration, would all be aligned with the Community system.
I am sure that your Lordships will readily appreciate that these proposals inevitably raise serious questions about the future direction of United Kingdom trade mark practice. This particular point has been made in a report by the Select Committee on the European Communities, prepared under the chairmanship of the noble and learned Lord, Lord Scarman, and which, I am given to understand, your Lordships will have the opportunity to debate after the Christmas Recess. I would hope that my noble friend would agree that it would be undesirable to embark on legislation of the kind proposed by this Bill before we determine the future course of British trade mark law.
My noble friend stressed that our service industries would be placed at a disadvantage unless a service mark register was created before the Community system came into force. I am aware that in trade mark circles in this country some anxiety is felt because the draft Community regulation does not provide for opposition to be raised against a Community trade mark application on the basis of an unregistered service mark. Instead a trade mark owner would need to protect his rights by the more complex invalidity procedure provided for in the draft regulation.
However, I would suggest to your Lordships that this problem is not confined to service marks, nor indeed is it confined to the United Kingdom. The Government will not stand idly by and allow our service industries to be at a disadvantage—and I wish to stress that point very strongly this afternoon. The Government have made constructive proposals for meeting this particular problem, and our proposals are receiving a very large measure of support in the discussions which are, as your Lordships are aware, taking place in Brussels. There is now a strong possibility that the draft proposals will be changed to

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meet the problem faced by owners of unregistered rights. Therefore, at this stage we cannot say that registration facilities for service marks must be provided before there is a Community system, because the final form of that Community system is still unclear.
At the next stage we should consider the likely effect of the Bill that is before your Lordships on the trade marks registry itself. It is not simply a question of taking on a few more staff—perhaps 50, or a few more, or a few less—to deal with the extra work. Since the time of the Mathys Report the input has gone up from 17,000 to over 21,000 applications each year. We believe that the addition of service marks would add up to another 5,000 applications each year. I am sure that your Lordships would agree that that would place a very severe burden on the registry at a most crucial time.
Sir Derek Rayner has already made a comprehensive study of the trade marks registry, and he has made a number of recommendations for improving the efficiency of the organisation as it at present exists. Once the changes are implemented, the registry should be in a position to reduce its already considerable backlog of unexamined applications and, above all, should be able to provide existing users with a better service. We are of the opinion that any interference with the reorganisation at this stage could bring about a severe deterioration in the service that is available and, above all, would increase the backlog of work to an intolerable level for all industries.
I am sure that the House will appreciate that even if the number of staff in the registry were increased from the current level of about 200 to around 250 to take on this added workload, the presence of such a high proportion of inexperienced staff would in itself seriously jeopardise the efforts that are now being made. We are very strongly of the opinion that to add to the burdens of the registry just now would not be prudent.
I should like to attempt to cover one or two of the points that have been raised in the very interesting debate that we have had on my noble friend's Bill. My noble friend was kind enough to give me a fairly detailed indication of what he proposed to say. I think he has a fairly clear idea of what I have in mind and of the Government's view. I hope to make absolutely clear the Government's view that we have sympathy with his Bill, and we shall certainly make clear all our views.
I am afraid that we do not agree necessarily with the noble Lord, Lord Mishcon, either on the cost to the trade marks registry, for the reasons which I explained, or, necessarily, on the European Communities aspect of this Bill. But that is I hope not purely a matter of professional opinion; it is the Government's considered opinion that these two arguments are not strong enough to warrant out right support of this Bill.
The noble Lord, Lord Lloyd of Kilgerran, raised (I think he called it) the Rysta case. I shall not follow him down that avenue. It is fascinating, but I would say to the noble Lord that we would not be able to comment on the appearance before various courts of trade mark
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agents or patent agents or barristers or any others who might feel that their professional qualifications enable them to appear with relevance before these courts.
We are grateful for the comments from my noble friend Lord Noel-Buxton and from my noble friend the Duke of Portland, but the noble Lord, Lord Davies of Leek, certainly allied himself, I believe, to my noble friend Lord Cawley. My noble friend mentioned one measure which (I think he said) was both "sooty" and "dusty", and my noble friend went on to point out that much of the language in this field was (I think I quote him correctly) crabbed and involved.
But, my goodness! in the commendably brief, relevant and amusing speech of the noble Lord, Lord Davies of Leek, he mentioned some question of molecular roulette in pharmaceuticals. The noble Lord, with his experience of that industry, could well be right. Indeed, he would agree that it goes a long way to showing that one should not gamble with the relevant trade marks or with other aspects of the pharmaceutical industry as far as trade marks and descriptions are concerned.
My noble friend Lord Cawley raised considerable correspondence and considerable comments on the passage of the famed Patents Bill through your Lordships' House. I hesitate to correct and jerk my noble friend's memory, but it was, as I recall and as I am sure noble Lords recall, just under six years ago, at the end of January 1977, when we set out on that lengthy Bill, to which there were over 600 amendments.
I would stress to my noble friend that, even if trade marks legislation or legislation of the type before us this afternoon is advanced by the Government when my noble friend is at the age that he suggested that he might be, knowing my noble friend's record and the record of service to your Lordships' House of noble Lords all round the House who are of considerably advanced years, we shall look forward to my noble friend's contribution in his 95th year. But I hope that we will have some trade marks legislation before then.
I hope I have covered most of the points that were raised in debate. In conclusion, I would say to my noble friend that we have every sympathy with his proposals to improve the protection available for service marks. We have not found a pressing need on the part of industry; we believe there is no pressing need from the Community; and we believe there is every need to take a balanced view of our trade mark law in the light of Community proposals already before us and, above all, to get the trade marks registry right before we embark on any new course.
Lord Davies of Leek: My Lords, does that nice little speech mean that this valuable document which the committee worked hard to produce under the chairmanship of Mr. Mathys in May 1974—and then, of course, we had some legislation later on—is kept in mind? Do they still keep the valuable work in mind, and do they ever look at the report in relation to the position that we are in today?
Lord Lyell: My Lords, I am sure that the department keep this report before them. As my noble friend pointed out, today's Bill, which has been

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proposed so ably by my noble friend, covers paragraph 70 of the Mathys report. The Mathys report is not gathering soot or dust in the department. It is in my office, and I know that it is in several other Ministers' offices as well.
Lord Mishcon: My Lords, before the noble Lord sits down, may I ask him whether he is aware that paragraph 70 talks about a passing off action being unsatisfactory as compared with a registered service trade mark? Is he further aware that, while he is deeply loved by this House, his speech on behalf of the Government in protection of industry was one of the weakest and most calamitous that I have ever heard?
Lord Lyell: My Lords, I am always very grateful for the kindness shown by your Lordships. I hope that I put the Government's case with my customary clarity. My forth right views may not be totally in accordance with the wishes of your Lordships' House; but, nevertheless, those are the views of the Government. The noble Lord points out that what appears in paragraph 70 of the Mathys report expresses an opinion. I hope I did not say that the Government agreed with that particular paragraph, but merely that my noble friend had selected that paragraph for his Bill. I am grateful to the noble Lord, Lord Mishcon, and reciprocate his comments that we all enjoy hearing his views and clarity on matters of the law. Of course, he is, after all, a professional lawyer; I am not.
2.58 p.m.
Lord Campbell of Alloway: My Lords, I shall be brief. First of all, I wish to thank all noble Lords who have spoken in this debate, not only for their very important contributions—which, for all we know, may shape a new course, as some noble Lords thought might happen—but for the toil spent in the preparation of those important contributions.
As Christmas is coming, I also wish to compliment my noble friend Lord Lyell on his style. I cannot compliment him on much else because, like the noble Lord, Lord Mishcon, I was unable to understand what he was saying. But he was put in to bat at the behest of his captain, the noble Lord, Lord Cockfield. I hope that your Lordships will agree that he defended his wicket as best he could, with flair and tenacity, as a loyal stonewaller.
There is a matter which I am told I have to mention for the record: that the amendment to be carried, which is formal in Committee, is adding paragraph 10 to the schedule. Section 68(1) is amended by inserting in the definition of "trade mark" the words: "or services" after the word "goods" in both places where that word occurs.
But, returning to the matter of substance in this debate, as the views of your Lordships have shown, the whims and fantasies of a department of state are ever subservient to national economic advantage. Those who understand the need for such advantage, as your Lordships on all sides of this House do, as industry does but as her Majesty's Government do not, make it plain that there is massive support for this Bill; and it is the duty of anyone, irrespective of political allegiance, to continue to stand their ground, as I have been encouraged to do in view of the support I have
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received from your Lordships and the support I have received from industry. Saying that, I will always be a loyal Tory, but this is really a bit much, as the case against the Bill (as advanced by the noble Lord, Lord Lyell) is plainly unintelligible.
As to the two points of unintelligibility, I would say to the noble Lord, Lord Mishcon—and I say this with no disrespect to him, as any practising lawyer would know—that this common law argument about passing off, put into the mouth of my noble friend Lord Lyell, is totally risible; and I will detain your Lordships on some future occasion by explaining why, if your Lordships accept that I could so explain. Furthermore, I do not agree with the noble Lord s suggestions as to delay; nor do I accept that the Government, as he says, will not stand idly by when he advances five separate unjustifiable reasons as to why they shall.
In fairness to my noble friend, who is not a lawyer and who has been led into dealing with these matters, I would say that if, when he opened his brief, one detected a musty whiff of departmental condescension, that is not to be laid at his door. The noble Lord is ever courteous, but condescension affords no substitute for reason, especially where the Bill has support from all sides of the House; where industrialists demand this protection; where there are no serious inroads on parliamentary time involved; where there are no undue demands on the time of parliamentary counsel envisaged and where there are no serious financial implications. Also, the question of staff has been dealt with, I hope, by various of your Lordships, and the implementing machinery presents no problems which may not with ease be surmounted. In submission, it would be right and proper to invite any Government to carry this Bill, subject to minor amendment in due course, with reasonable despatch. I therefore beg to move that this Bill be now read a second time.
On Question, Bill read a second time and committed to a Committee of the Whole House.

Nuclear Forces: Geneva Negotiations
3.5 p.m.
Lord Mayhew Lord Mayhew rose to ask Her Majesty's Government what progress has been made in the intermediate-range nuclear forces negotiations at Geneva; and whether they will make a statement.
The noble Lord said: My Lords, I wish to draw attention to the deplorably negative reaction of President Reagan and the Prime Minister to the offer on nuclear disarmament contained in Mr. Andropov's speech yesterday. Naturally, some clarification is needed of the Soviet offer. In particular, what is supposed to happen to the SS20s which would not be deployed in Europe under the offer? Would they be scrapped or would they be redeployed outside Europe? But much has now become clear. First, the Russians are prepared to make significant reductions in their missiles to avoid the deployment of cruise missiles and Pershings. This is encouraging and should have been welcomed. It already vindicates the multilateral approach to disarmament. If Europe's unilateralists had had their way, and if the British, the Germans, the

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Italians and the French had taken the same unhelpful attitude on cruise missiles as the Belgians and the Dutch, this Soviet offer would never have been made. Indeed, the Soviet Union would never, I imagine, have agreed to come to the negotiating table.
The second important feature is that the offer places no restriction on the deployment of American missile submarines in European waters. The Americans already have a powerful fleet under NATO command in European waters, much of it in Holy Loch. It is argued that these submarines are strategic, not intermediate range, but the SS20s have a longer range than the American Poseidon missiles. If the SS20s are intermediate range weapons, so are the Poseidons. Therefore, it is untrue to say that the Soviet offer would leave the Russians with intermediate range missiles in Europe, but not the Americans. Of course, the President and the Prime Minister can argue that submarines are less accurate and have a longer reaction time than land-based missiles. But it is not clear why, in the European context, this makes them ineffective as a deterrent.
Indeed, the whole argument about nuclear balance sometimes becomes quite unrealistic. The President and the Prime Minister seem obsessed with the idea that nuclear missiles must be precisely balanced, one for one and type for type. Why do they take this line? Most of the rest of the world accepts the plain truth that, after a certain level of nuclear capability has been reached on both sides, questions of balance become virtually meaningless, and an agreement to reduce overkill can profit both sides immensely, even if more overkill is abandoned on one side than on the other.
I am sure there will be general agreement that, if the Russians and the Americans could reach agreement in this field—an agreement acceptable to both of them—it would be enormously valuable. It would freeze at lower levels, by mutual consent, the number of nuclear warheads deployed in Europe. It would strengthen confidence in multilateral disarmament and greatly improve the prospects for the START talks. It could be a turning point in East-West relations. And perhaps not the least advantage would be that it would restore the unity and sense of common purpose of the alliance, which is very much lacking at the present time. It would also help to end the bitter internal divisions on defence policy which have occurred in all the member states of the NATO alliance. Yet President Reagan has dismissed the Soviet offer with contempt and other Western leaders have tamely followed suit. Yesterday the United States again stated officially that only the complete elimination of the SS20s would justify forgoing the deployment of cruise missiles and Pershings. This means that after more than a year of negotiation the United States' position has not moved one inch.
The question must be asked: Do the American President and the British Prime Minister seriously want an agreement? It is not a question one would have needed to ask if at the White House there had still been President Truman or President Eisenhower, or President Kennedy, or if Atlee, Eden or Macmillan had still been at No 10. It is a great misfortune that at this critical time the occupants of the White House
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and 10 Downing Street should be two people so strongly drawn by temperament and ideology towards conflict rather than conciliation—people, moreover, who take a dangerously simplistic view of the intentions of their adversaries. To those who have observed their past performance, it is no surprise that they should have dismissed the Soviet offer out of hand, stuck to their original demand and given not the slightest sign that they were ever contemplating any counter proposals.
With anyone else one might presume that this was adopting a tough negotiating position. If so, nobody with any experience of negotiating with the Russians—I myself have had some experience—could possibly object to that. But with President Reagan and the Prime Minister this is not a reasonable assumption. It took much time and much persuasion before President Reagan agreed even to negotiate in this field, and it took more time and more persuasion before he agreed to the zero option. Since then the United States has been negotiating in a remarkably leisurely fashion. There have been long recesses, taken on American initiative, without Soviet support. When I was in Washington earlier this year I asked at the highest level the reason for these recesses and I was told it was because the American team quickly became jaded in these negotiations. This is not a satisfactory reply. I now understand—the Minister can correct me if I am wrong—that when the talks were not in recess the average time that the two principals met together was not more than two hours a week. There is no evidence, either, that the British Prime Minister has seriously pressed President Reagan at any stage to take these negotiations more seriously.
When we recall and analyse the statements and actions of the President and the Prime Minister in matters of defence and disarmament over a long period, the truth is inescapable. Neither of them is seriously hoping or working for a compromise at Geneva. Let us suppose, as seems possible, that the talks fail because the Americans rather than the Russians prove too inflexible. What is the British Government's policy then going to be? I say that in this event there must be no question of the deployment of cruise missiles in Britain. If the British Government attempted to deploy these missiles after the Americans had caused the Geneva talks to fail, they would find Greenham Common ringed not by tens of thousands of unilateralists but by hundreds of thousands of multilaterlists. That would be the effect if this should happen.
What should be the Government's reponse? I submit that first the United States Government and the British Government should welcome Mr. Andropov's offer. His concessions may be limited but, after all, President Reagan, after a year of negotiations, has made no concessions—so really, the West is not in a position to complain. Next, clarification of the Soviet offer must be asked for on a number of points. Then President Reagan, supported and urged on by a British Government, should make constructive and sensible counter proposals to the Soviet offer. The Government's dismissal of the offer is unbelievable folly. If the Government do not change course and do not exert the utmost pressure on the United States to reach an agreement, they will be arousing the

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opposition not of a minority of unilateralists but of millions of people who are committed multilateralists and supporters of the NATO alliance.
3.15 p.m.
Lord Thomas of Swynnerton: My Lords, I must apologise to the House and to the noble Lord, Lord Mayhew, for my inadvertent absence at the beginning of this debate. I insufficiently informed myself as to the time when this debate was likely to start. This is certainly a timely debate and we must be grateful to the noble Lords, Lord Mayhew, and, at an earlier stage, Lord Kennet, for introducing it at this time. I am bound to say that, had I been asked to suggest what would be the most interesting and important matter to discuss this Christmas, it would have been the extraordinary suggestion that a major power was involved in the attempted murder of the Pope. This would have seemed to me to be a more striking subject for us to debate today.
Nevertheless, there is no doubt that this is an important subject. As I said a moment ago, the debate is well timed in view of the proposals made by Mr. Andropov in Moscow and reported in today's press. I must say that the speech made by Mr. Andropov, as it was reported in the Financial Times, began in what I consider to be a very unpromising manner. To say that the war preparations of the United States and NATO have grown to "a record scale" comes rather strangely from one who has been part of a Government which has built up its armed forces in exactly that way over a large number of years. This is particularly so in respect of nuclear weapons but it is true of conventional weapons as well; we have all read of the growth in the strength and menace of the Soviet Navy over the past 20 years. Perhaps, though, this is just a question of a preamble and the proposals involved in Mr. Andropov's speech are more important and more serious.
The question we have first to ask is, was this speech intended only as propaganda? It certainly had in it some element of propaganda; I believe we all accept that, and that the noble Lord, Lord Mayhew, would not disagree. These proposals were launched in a speech and not at the conference; in a speech just after the conference had adjourned for a month. Had it been a proposal intended principally for practical discussion, surely it would have been launched at the conference itself. It is also comprehensible that a dictatorship with no public opinion to worry about very much would be likely to try to influence public opinion in countries where its supposed opponents are for or against a particular line of policy.
We know from other sources, statements and actions that the Soviet Government are particularly interested in trying to divide the United States and Europe, and in trying to prevent deployment of the Pershing missile in West Germany and, to a lesser extent, the establishment of cruise missiles in other countries, including our own. There is no doubt whatever that the speech of Mr. Andropov in the form in which it was presented to us today in the press, certainly suggested that those aims were fulfilled. There may have been other aims but certainly those aims of trying to disturb public opinion over the establishment of Pershing and cruise missiles, and
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trying to divide the United States from Europe, were perfectly served by that speech. That is a preliminary point.
As to the viability or validity of the proposals themselves I think that the noble Lord, Lord Mayhew, would agree that the nuts and bolts of any realistic disarmament programme proposal must depend on the supervision and control powers included in it. Any realistic person who has negotiated with the Russians, as the noble Lord told us he had, could hardly fail to notice that in this proposal put forward by Mr. Andropov yesterday there was not a single reference to how this was to be effectively controlled; we cannot help noticing that. This is a particularly serious omission when we recall that a mobile missile like the SS20 is particularly difficult to control. Even in the age of aerial surveillance that is true. The whole proposal, therefore, seems to me to be a much less attractive one than that put forward a little over a year ago by President Reagan for the so-called zero option, which would have been easier to control, since there would have been no intermediate range missiles allowed at all. It is perfectly obvious, therefore, that it was much simpler to see whether such a proposal was carried out or not.
The second point I thought should be raised was what would happen to these Soviet SS20s if they were going to be withdrawn from Europe. Would they be destroyed? Again, there is no reference to this specifically in the speech made by Mr. Andropov-yesterday. They were going to be withdrawn from Europe. What does "Europe" mean in these terms? We all know what we think of as Europe in terms of the European Community, but it is perfectly plain that it does not mean that. It means Eastern Europe, but are we to suppose that the SS20s will be withdrawn from Western Russia, from European Russia? Again this proposal is quite silent on that point.
I must say that, if these SS20s are to be withdrawn East of the Urals and left intact, that is not a satisfactory proposal, because, in the first instance, they could probably reach—as far as I understand the range of the SS20—almost all of Western Europe except for a thin sliver of Portugal. Secondly, they could in a time of crisis be brought back by lorry into the Western part of the Soviet Union, or even into Eastern Europe, in a matter of hours. That seems to me a very important criticism of this proposal. Once again the President's zero option proposal seems a much more attractive one.
I also think we should consider what would happen if these missiles were actually destroyed, and in some way, too—another very important point—the SS20s which we would assume would be allowed under the proposal to continue to be in Asia were to be neutered, so that we should simply be facing the same amount of nuclear power as we, the British and the French, have in other forms of missile or other forms of nuclear capacity. Surely we would simply be back, if that were to happen, in the state of affairs we were in in 1977, when Chancellor Schmidt first drew our attention publicly, at a lecture at the International Institute of Strategic Studies, to the very serious imbalance so far as intermediate range nuclear weapons were concerned. They were for a short time known by a different title, but, perhaps thanks to the noble Lord,

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Lord Kennet, they changed from that name to their present more satisfactory title of intermediate range nuclear weapons.
Surely we should simply be back in that position, which was recognised by all the Governments at that time, after some persuasion by Chancellor Schmidt, to be a very bad position. After some difficulty, he persuaded President Carter to take that view, he persuaded Mr. Callaghan to take that view and he persuaded President Giscard d'Estaing to take that view. After a great deal of difficulty and persuasion, President Carter agreed that the Pershings and the cruises were to be deployed in order to meet that anxiety which had been well expressed by Chancellor Schmidt. If, in fact, all these proposals do is take us back to a position which Chancellor Schmidt thought was very dangerous, what is the point? Surely once again the zero option proposal is a good deal more attractive.
Let us not forget, too—I do not believe that Mr. Andropov will have forgotten it—that until now we have never thought of the French and the British nuclear weapons as exactly intermediate range missiles. We thought of them as strategic missiles. It may be that they cannot get very far compared with the ICBMs possessed by the two super powers but, nevertheless, we have thought of them as strategic weapons. Furthermore, we all know very well that the French nuclear force is not fully integrated into NATO. For all these reasons, therefore, the American proposals are much more satisfactory. I cannot help reaching that conclusion.
Your Lordships may be thinking that it will be desirable to take into account the other nuclear forces which, of course, should be considered in relation to the proposals. I believe that to be very desirable, because, even were this proposal to be introduced and these cuts made, we should still find ourselves in Western Europe facing an immense number of Soviet weapon systems, many of them with nuclear capacities—in particular, the Backfire bomber to which attention was paid, rightly, in the period 1977–79 to which I am referring.
Your Lordships may be thinking that perhaps I should have dealt in these comments on Mr. Andropov's speech with the other proposals he made in relation to cuts in levels of intercontinental ballistic missiles. I think that it is reasonable to do so, even though that is not the subject of this debate. However, once again it seems to me that President Reagan's proposal for what is, in effect, a 50 per cent. cut in the efficacy of the strategic reach of the Western Alliance is a great deal more attractive than the proposal of a one quarter cut made by Mr. Andropov.
Your Lordships will no doubt be asking, "What of the MX?" I believe that we should remember that the United States has not introduced any new intercontinental ballistic missiles since 1969. Mr. Andropov said in his speech, as I read it, that the American proposal was suggesting that there was some kind of lag in consequence of that failure to introduce a new missile since 1969 and to speak of that as a lag was some kind of deliberate untruth. Those were the words as reported in the Financial Times. I can only
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suppose that that must have been an error of translation because it is obviously the case that the old American ICBMs of 1969—the Minuteman missiles—seem at the present time to be unlikely in the first instance to be able to destroy the newly hardened silos containing the Soviet missiles. Secondly, they would be unlikely effectively to survive a first strike if such a thing were to occur.
Indeed, a combination of the zero option as far as INF is concerned and the President's proposals on the ICBMs seems to be much more reasonable than what was put forward by Mr, Andropov in his speech yesterday.
I confess to a certain sense of surprise that the American proposals are not more widely applauded and better received. I have always thought it odd that the United States, which brought public relations to a fine art in Madison Avenue, has not been able to put over its international proposals for disarmament more effectively to a wider public than is the case.
I confess that in the end I would freely admit to being sceptical about the efficacy of these disarmament negotiations. I admit that. I do not think that is being unduly cynical or pessimistic. I find it difficult to believe that a state whose ideology still impels it towards expansion, particularly military expansion, and a state whose heavy armament programme is concerned as a matter of course with bullying both its own citizens and its neighbours into subservience, is likely to be able to accept a far-reaching disarmament programme, I may be wrong and I shall be delighted if that turns out not to be the case.
The Soviet Union has, on occasion, accepted one or two modest proposals for disarmament such as SALT l or the partial test ban, when it was plainly in its short-term interest to accept such proposals. Some reduction in Soviet arms spending may well be something that any Soviet Government may wish to see at some time in the future. I am sure that the main aim of the proposal put forward yesterday so effectively and so timely (if I may put it like that) by Mr. Andropov was to try to prevent the establishment of the Pershings and the cruise missiles.
I feel that the best advice we may receive this Christmas on this type of subject can be seen in the most recent issue of the New Statesman, in which there is a very important letter from a Czech citizen, Mr. Racik, who writes:
"I would see the task of a non-naive peace movement as that of supporting military force as an instrument of democracy confronting totalitarianism and of restraining that instrument's propensities to subvert the democratic system".
3.32 p.m.
Lord Jenkins of Putney: My Lords, the noble Lord, Lord Thomas of Swynnerton, has told us that he thinks that President Reagan's zero option proposal is reasonable and acceptable; and, of course, so it is from the purely Western point of view which he adopted. But if one wishes to reach an agreement on any subject and on any kind of debate, one has to try and see the proposal as it appears from the point of view of the other side, and not only from the point of view of those who may be regarded as belonging to the West.

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In seeing the matter from the point of view of the Soviet Union—with whom, after all, we are supposed to be seeking an agreement, so it is incumbent on us to try and see it from their point of view—they start from the position that at one time they had no nuclear weapons; that the only nuclear weapon which existed for many years was owned by the West; and that we, the West (and I am regarding the West as a whole for the moment) are the only group of nations which has actually dropped a nuclear weapon in war and have in fact killed people by nuclear weapons.
Therefore, the Soviet Union see themselves in this matter as being initially at a disadvantage; as existing for years in the position of being helpless against a nuclear weapon; as having very strong conventional forces but, in nuclear terms, as being the country which all the time has had to try and catch up. That is precisely what they have been doing. If we look at the record of the development of nuclear weapons over the years, we find that all the initiatives have been taken by the West; all new developments have been made by the West, and on each occasion the Soviet Union has been catching up.
Now, in one single respect, the Soviet Union has gone ahead, and that is in land-based, medium-range missiles in Europe. It is as regards that matter that the United States says, "We are certainly ahead in intercontinental missiles; we are certainly enormously ahead in submarine-launched missiles; we are also probably ahead in battlefield missiles; and on this one point, as far as land-based intermediate range missiles are concerned, we must be ahead there, too". This is the reality of the situation as it is seen from the Soviet Union. It is not only the reality of the situation as it is seen from the Soviet Union; it is the reality of the situation as it is seen by every international organisation, whether it be the Stockholm body SIPRI or the ISSS.
All the international organisations agree that this is the reality. It is not the case, as the Americans are fond of suggesting, that they are behind and are catching up. The reverse is true. It is on this single point of the land-based missile that the Soviet Union has caught up. This has caused the great American sensitivity. To try to deal with this along comes President Reagan with his zero option, which the noble Lord, Lord Thomas, finds so attractive.
In the circumstances which I have described, can noble Lords really be surprised that the Soviet Union do not find this particularly attractive? From their point of view it is not. This is why, when Mr. Andropov comes along with his proposal, I think it is unreasonable to dismiss it out of hand. I think that it would be equally unreasonable to dismiss President Reagan's zero option out of hand. What ought to happen is that both proposals ought to be put on the table and serious discussions ought to take place.
I am inclined to share the view put forward by the noble Lord, Lord Mayhew, who I think has done us a service in raising this matter, that the multilateral discussions which have been taking place for so long have hardly been serious discussions. While they have been taking place throughout the years, the weapons themselves have accumulated. There was an American preponderance, on the whole, about 10
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years ago, at the range of a capacity in both sides to kill everybody else on the other side about twice over. What has happened now is that, with the increase in the totality of nuclear weapons to something of the order of 50,000 or 60,000 spread over the world, each side can kill the other side about 10 times over.
It is in this situation that the apprehensions which have been so clearly put forward by the noble Lord, Lord Mayhew, should be taken seriously. It is because the multilateral discussions which have taken place over these years have achieved nothing that the nuclear weapons all over the world are increasing and that the tensions are increasing. Every international organisation which examines the matter does not say, as the Government sometimes say, "Everything is quiet; everything is peaceful; do not worry; the nuclear weapons have kept the peace". The international organisations say that nuclear weapons are building up, that one of these days they will explode, and that that day will not be too long coming.
I believe that this is why the sensible unilateralists and genuine multilateralists are beginning to come together. The extremists on either side—and I refer to the non-genuine multilaterists, if such people exist, and I would possibly also refer to the excessive unilateralists, if such people exist—take the view, which is often ascribed to them, that unilateral disarmament means total unilateral disarmament by the West. It really has never meant any such thing, and it is now beginning to be appreciated that what those of us who are calling for unilateral action mean is that this country should make the sort of gesture which we are uniquely placed to make in order to try to break down the impasse and create the multilateral discussions which we know can be the only way to peace.
I think we all accept that, ultimately, multilateral discussions and bilateral discussions between the United States and the Soviet Union are the only way in which peace can be achieved. Therefore, the noble Lord, Lord Mayhew, is right to raise this matter. The truth of the matter is that, in the eyes of some noble Lords, the Soviet Union can do no right. This was quite clearly illustrated just now when the noble Lord, Lord Thomas, said: "This cannot be a serious proposal of Mr. Andropov because, if it was, they would have put it forward in the Geneva discussions instead of doing it publicly". Only a couple of hours before the noble Lord, Lord Belstead, said that this cannot be a serious proposal because, in fact, they put it forward privately in the Geneva discussions.
So whatever they do—whether they put it forward privately or publicly—one way or the other, it gets dismissed. It gets dismissed in Geneva by ignoring it and it gets dismissed publicly for a reason that I leave your Lordships to guess. It is beginning to seem to some of us that the West is not interested in having real discussions about getting these armaments down. It is in this circumstance that people in this country and in the United States, too, are becoming increasingly alarmed about the failure of their own Governments to take the situation seriously.
It is incumbent upon all of us to ask the Government not to treat the matter, as they appear to have been doing until now, as something which can go on and on, without ever reaching a conclusion, because

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the conclusion which some of us believe will be reached unless the breakthrough is made is the conclusion which the world is beginning to fear is inevitable, and that is a nuclear holocaust. It is that conclusion which we believe the Government have a paramount duty to seek to avoid, and it is that which we hope to hear from the noble Lord, Lord Belstead, when he replies to this debate.

The Fisheries Council: 21st December Meeting
3.41 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers): My Lords, it might be for the convenience of your Lordships if I were to repeat a Statement which is being made in another place by my right honourable friend the Minister of Agriculture. The Statement is as follows:
"With permission, Mr. Speaker, I should like to make a Statement on the meeting of the Council of Fisheries Ministers which met yesterday in Brussels. I represented the United Kingdom, together with my right honourable friends the Secretary of State for Scotland and the Minister of State.
"The nine member states were agreed on a package of measures for a revised Common Fisheries Policy. No changes to this package were proposed or discussed.
"The Commission had clarified to Denmark some of the administrative measures involved in the package and had also arranged for a possible allocation of mackerel in the North Sea which would become available from Norway and the Faroes.
"The Danish Government decided to refer this package to the relevant committee of their Parliament with the Government's strong recommendation for acceptance.
"To the bitter disappointment of the entire Community the minority Danish Government was at yesterday's meeting unable to gain the agreement of that committee. The Danish Government have undertaken to continue to seek to persuade the committee to accept the agreement and the Council has affirmed that it remains open to Denmark to signify before 30th December that the package is acceptable.
"The Council then proceeded to consider what national measures would be needed in the event of the Danish Government failing to accept the agreement before the 30th December. The Commission made a declaration as to the manner in which they would authorise national measures, following notification by member states, in order to protect stocks in accordance with provisions based upon the latest formal Commission proposals.
"The Commission made an unequivocal statement as to the right and obligation of all member states, in the unique circumstances of fisheries, to protect this vital resource, and the Commissioner stated that this would apply to all of the proposals on conservation, access and quotas.
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"Honourable members may have heard the President of the Commission, Mr. Thorn, confirm this morning that these measures would be effective and legal.
"As far as the United Kingdom is concerned, I signed this morning orders which will make these proposals part of our national law, and I have notified the Commission. They will be laid before the House so that they will come into effect if necessary on 1st January.
"Agreement was reached on an interim package of structural measures which I know will be welcomed by our industry.
"I can only express the hope that Denmark will approve this agreement before the end of the year and will take note of the warning given to them by their Prime Minister that their failure to agree will leave the Danish fishing industry in a worse and not better position."
My Lords, that concludes the Statement.
Lord John-Mackie: My Lords, we are obliged to the noble Earl for repeating that Statement, a very disappointing one creating an unfortunate situation. It appears that it is more a Danish problem than anything else, although of course it affects all the other members of the EEC. It is certainly unsettling the fishing industry, particularly in Scotland. While I am not too conversant with the situation there, I understand that the Federation is having great difficulty with its members and that some of them are not very happy and are thinking of resigning, if they have not already done so. It is therefore a situation which is upsetting the fishing industry very much indeed.
May I ask the Minister to say what steps the Government are likely to take—I hope he will find it possible to answer this—to stop the Danes? Whatever else we do, I hope the Government will try to avoid any action that might lead to violence: we do not want a repeat of what happened with Iceland a few years, ago. No doubt the orders, which I gather the Minister signed today, indicate more what might be done. I feel it is very important not to close the door. Although the Statement suggests that what the other members will do now is to wait until 30th December, I wonder whether there is any indication that there might be a further meeting—I appreciate that, with Christmas and the New Year, it is not easy to arrange meetings—should the Danes wish to have such a meeting?
It is interesting to note that in the second paragraph of the Statement it is said:
"No changes to this package were proposed or discussed".
And the following paragraph says:
"…also arranged for a possible allocation of mackerel in the North Sea which would become available from Norway and the Faroes".
That seems to be a change, and perhaps the Minister would explain that. Could he also provide some information about what is meant by,
"an interim package of structural measures"?
Whenever I hear the word "structural" I feel it means a reduction in the size of the industry. That applies to most industries the moment the word "structural" is

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used. Perhaps the noble Earl will answer those questions. As I say, we are all very disappointed over what has happened. I like the Danes, I have been to Denmark several times and I used to have a Danish farm manager. I should hate to think that we would ever get to the stage of almost open warfare with them.
Lord Mackie of Benshie: I normally agree entirely with my noble kinsman, my Lords, but on this occasion I must disagree; I think we should stand absolutely firm on the measures proposed and agreed by the other nine nations. I must remind the House that the Danes, by their industrial and fishing policy, are responsible for more of the depletions of stocks in the North Sea than any other single nation. Furthermore, the Shetland fishermen are very restive about the Shetland box and the concessions that have already been made there, and in my view all the concessions that should have been made have been made. It is up to the Danish Government to be sensible and for their committees to follow the advice of their Government, and I hope and trust that our Government will stand totally firm on the very large concessions that have already been made, which affect very largely the livelihood, in particular, of the Shetland fishermen. I agree with my noble kinsman in asking for clarification of the third paragraph of the Statement. May we be given more details of any possible allocations? And as for the paragraph which refers to,
"an interim package of structural measures",
may we be told a little more of what the structural measures are?
Earl Ferrers: My Lords, I am grateful to the two noble Lords for the modest welcome they gave to the Statement. I thought the noble Lord, Lord Mackie of Benshie, was somewhat unfair to his noble kinsman when he said he disagreed with him. I did not know that the noble Lord, Lord John-Mackie, had said there should be any alteration; I thought he was merely asking questions. But, then, Cain did kill Abel and I am not quite certain whether that was happening on this occasion.
However, I agree with the noble Lord, Lord John-Mackie, that in some ways this is a disappointing Statement, because we had all hoped that there would be an agreement. It is one of the curious quirks of democracy, and indeed one of the quirks of the European Community, that in this particular case the parties of a member state which are not in government are in fact in a position to frustrate an agreement to which the Governments of all the member states wish to accede. This is the Danish problem which they have to get over. It was the Danish fisheries minister, and indeed the Danish Prime Minister, who tried to persuade the respective parliamentary committee of the Danish Parliament to accede to the proposal, and it was that parliamentary committee that refused to do so. As the Statement explained, the option has been left open for them to agree up to the 30th December. I agree with the noble Lord, Lord John-Mackie, that the uncertainty is undoubtedly upsetting, and we should wish to see that uncertainty halted as soon as possible.
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The noble Lord asked what was going to happen, and he hoped that there would not be violence. I entirely agree with him in hoping that there will not be violence, and I do not believe that there will be, or that there need be. But I would remind the noble Lord that if in fact national measures come into effect as from 1st January, and if fishing vessels of other countries that are not so entitled, as would then be the case, fish in our national waters, they will be liable to be approached, to be fined £50,000, and to have their gear confiscated.
The noble Lord, quite reasonably, said—and on this his noble kinsman agreed with him, which was encouraging—that he would like to know why in the second paragraph of the Statement it was stated that,
"No changes to this package were proposed or discussed"
while the third paragraph added that:
"The Commission had clarified…some of the administrative measures …and had…arranged for a possible allocation of mackerel…"
I think that that needs explaining. The position is that the package, which the member states were invited to agree, was drawn up on 26th October. That package has not been altered, but there are other arrangements, such as apply in Norway and the Faroes, which are outside the package, are renegotiated every year, can be altered, and on this occasion have been altered.
Both noble Lords also asked what were the "structural measures". The "structural measures" refer to a limited amount of money which the European Commission can give following individual applications from member states. Individual fishing owners, or fleet owners, can apply to the European Commission for help and an advance, and that is outside any grant aid that might be applicable to any member state. It is that to which the "structural measures" refer. Apart from that, I would join both noble Lords in hoping that the situation will shortly be resolved.
Lord Kennet: My Lords, I wish to ask only two questions. Can the Deputy Leader of the House tell us anything about the meaning of the phrase "laid before the House" in the Statement? The Statement said that the national measures,
"will be laid before the House"—
the House of Commons, of course—
"so that they will come into effect if necessary on 1st January".
Must we assume that they will not in effect be laid before this House, since we rise in an hour or two from now, but that the House of Commons will tomorrow have an opportunity to object, if it wishes? What is the parliamentary situation about those national measures? I am taking it for granted that our national measures correspond precisely to what we would have done had the Community regime been able to come into effect. I think that the noble Earl has already said that.
I come to my final question. Is the Deputy Leader of the House in a position to tell us whether the Danish fishing fleets are likely to do what their Government tell them, or what their Opposition tell them?
Earl Ferrers: My Lords, the position with regard to the orders being laid before the House is that in fact

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they will be laid before both Houses of Parliament. They can be laid during the Recess. They will be subject to negative resolution procedure, which means that they can be prayed against within, I think, 40 days. But they will become operative as from 1st January.
With regard to the types of national measures, they will be as near as possible the same as they would had there been a Community régime. For obvious reasons, which I think we need not go into now, because there is not a Community regime there may be individual circumstances which may make it impossible for them to be absolutely identical. With regard to the noble Lord's invitation for me to speculate on what the Danish fishermen may do, whether they will follow the advice of their Government or their Opposition, all I would say to the noble Lord is that fishermen of all nationalities are a fairly individual species of people and I would not like to speculate any more than would the noble Lord on what they would do. What I can do is to tell him that if they did that which they should not do, they will meet with a certain response.
Lord Boothby: While thanking the noble Earl for his reply, may I ask him to bear in mind that British sea power was built up on our fishing industry in the reign of Henry VIII and has been sustained by it ever since. As one who has fought for the fishing industry in both Houses of Parliament for over half a century, may I also thank Her Majesty's Government and, particularly, the Secretaries of State for Agriculture, Fisheries and Food, and for Scotland, for the courage, patience, coolness and skill with which they have conducted these arduous, lengthy and difficult negotiations. It is not our fault that they have broken down.
Finally, may I ask the noble Earl one question. Will he give us an unequivocal assurance that no foreign fishing vessel will be allowed to fish in British waters without the permission of Her Majesty's Government until we reach an agreed settlement; that we have the necessary forces in the air and at sea to ensure that this is so; and that, if necessary, we will not hesitate to use them?
Having said that, of course, we must all join in the fervent hope expressed from both sides that we can still reach agreement with these recalcitrant Danes—of whom I am one, because I am myself of Danish origin—and that they may still come to their senses and agree to these terms before Christmas.
Earl Ferrers: My Lords, I am greatly appreciative of what the noble Lord, Lord Boothby, has said. As he mentioned, he has been involved with the fishing industry for a great many years. I myself have had the privilege of hearing him campaign in Parliament on behalf of the fishing industry. To hear him say that this was a successful agreement and to commend my right honourable friend for (I think his words were) the courage, patience, coolness and skill of his negotiation are praises which I greatly appreciate, and I will see that they are passed on to my right honourable friend. I would only add, in parentheses, that none of them applies to me, because I have not been personally involved in the negotiations.
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The noble Lord said he hoped that no foreign vessel would be seen to fish in British waters. I can tell him that if, in fact, the common fisheries policy as we would hope to see it does not come into operation by January 1st, then there will be national measures. Under those national measures the Danish fishermen may not fish within 12 miles of British shores, and, if they do so, we will see that those waters are appropriately protected.
When the noble Lord referred to the recalcitrant Danes, that is an observation upon which I would not wish to comment other than to say that I think they have their own particular problems. The fisheries minister did say that if this proposition were placed in Parliament over the heads of the Parliamentary Committee, they might well find that their Government might fall; and he said that this is not an issue upon which they are prepared to fall. It is the exercise of democracy in one particular member state which has its unfortunate repercussions in others. That is not a unique phenomenon. It is one which, as members of the Community, we all have to try corporately to overcome.

Anderson Strathclyde and Charter Consolidated: Proposed Merger
4 p.m.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Trefgarne): My Lords, with your permission, I should like to repeat a Statement that is being made by my honourable friend the Minister for Trade in another place. The Statement is as follows:
"With permission, Mr. Speaker, I should like to make a Statement on the Monopolies and Mergers Commission report on the proposed merger between Anderson Strathclyde and Charter Consolidated and my decision not to prevent Charter Consolidated from renewing their bid for Anderson Strathclyde, if they decide to do so.
"The MMC submitted their report on 1st December. Since my right honourable and noble friend the Secretary of State for Trade had a shareholding interest in one of the parties to this merger, he considered that he ought not to take the decision on this report.
"The MMC report was a divided one. The commission concluded by a majority of 4:2 against the proposed merger. They recommended that it should not be allowed. Where the commission find against a merger. Parliament has left it a matter of discretion whether a report against a merger should be followed, or whether the merger should be allowed.
"I have considered carefully both the majority report and the dissenting report of the minority. The dissenting report was no ordinary note of disagreement. On the contrary it voiced the opinions of the chairman of the commission, and one other member, and represented a root and branch disagreement with the conclusions of the majority.

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"In considering the majority and minority views, I have also taken account, as I am obliged to do under the Fair Trading Act, of the views of the Director-General of Fair Trading. He recommended strongly against preventing the merger. It is common ground that this merger would not lead to any restriction of competition. The sole question therefore was whether the merger would have harmed other aspects of the public interest. While sensitive to arguments based on possible industrial implications in Scotland, I found that the argument that the merger would harm the public interest was too speculative. I therefore decided that it would not be right in all the circumstances of this case to stop the merger. But in leaving Charter free to renew their bid I sought an assurance from them that Anderson Strathclyde would remain a Scottish company with its registered office in Scotland. This assurance has been given me by the company."
My Lords, that is the Statement.
Lord Underhill: My Lords, the House will be grateful to the noble Lord, Lord Trefgarne, for repeating the Statement. Although it is a short Statement, it involves very serious consequences. I want to deal with the Statement primarily from the point of view of what the Opposition regard as unfortunate policy and economic judgment. I appreciate that because of his personal financial involvement with Charter Consolidated, the Secretary of State—who I am delighted to see is in his seat—passed consideration of the commission's report to the Minister for Trade.
I should like to ask whether the Secretary of State has power to divest himself of the responsibilities given to him under the Fair Trading Act 1973. Moreover, is it desirable that a Secretary of State should divest himself of those responsibilities? Can the Minister reply to a question put to the Prime Minister in the other place yesterday, which was not answered: Is there any precedent for such action by a Secretary of State? Is it not also correct that this is the first time that a Minister has rejected recommendations of the commission concerning a proposed merger?
Is not the decision to reject the recommendation a very serious one, and are not the views of the commission expressed very strongly in paragraph 9.20 of the report, which says:
"We conclude that the proposed merger may be expected to have an adverse effect upon the management effectiveness and labour relations of Anderson Strathclyde and that this would tend to diminish effective competition in the supply of goods, would be contrary to the interests of purchasers of goods in the United Kingdom and would not promote competitive activity by Anderson Strathclyde in markets outside the United Kingdom. We also conclude that both because it would affect employment within Anderson Strathclyde and because it would detract from the dynamism of business in the region, it may be expected to have an adverse effect upon employment in a relatively depressed part of the United Kingdom. These effects may be expected to operate against the public interest unless offset by some advantages."?
My Lords, is it proper to disregard the views of three influential Scottish economic planning bodies?—namely, the Scottish Council (Development and Industry), the Scottish Development Agency and the Scottish Economic Planning Department, all of whom gave evidence in opposition to the proposed takeover. Also, does not the report emphasise that most of the witnesses who sent written views were similarly
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opposed to the proposal? Although emphasis is given in the Statement to the views of the chairman of the commission and to the consultative views of the Director-General of Fair Trading, is that justification for putting on one side the views of the majority, the four members, who had heard all the evidence on this matter?
I have said that I wish to concentrate on the political and economic consequences of this matter, but there are one or two questions I must ask in addition. First, is it justifiable that a Minister should not divest himself of shareholdings during a period of office? I ask this from the standpoint of public confidence. When the proposal was first referred to the commission, would it not have been advisable at that stage for a statement of the Minister's financial holdings to have been made public? Is it not regrettable that this matter was only brought to the attention of the general public arising from a point of order raised at Question Time yesterday in the other place?
Also, is it not correct that the evidence shows that in every way Anderson Strathclyde is an excellent company with good labour relations and is thoroughly opposed to the proposed takeover? Does it not now mean that if the takeover proceeds, a conglomerate with very large South African interests will take over this effective concern? Finally, will steps now be taken to halt any move towards a takeover bid until Parliament has had the fullest opportunity to discuss both the report and the rejection by the Minister of Trade?
Lord Tordoff: My Lords, this Statement, for which we are grateful, clearly comes in two parts and perhaps I may deal first with the part relating to the Secretary of State. It is, of course, very easy in another place to make a lot of political capital out of this situation. I hope that noble Lords in this House will not go down that track. The suggestion that, for a modest shareholding, the whole of the Government's judgment is to be corrupted seems to me to be nonsense; and I am very glad that the Secretary of State is in his place to hear the views from at least these Benches.
On the question of overturning a finding of the Monopolies and Mergers Commission, I think that your Lordships would expect a certain rising of hackles on these Benches. I believe we have a powerful record of wishing to see monopolies on all sides brought to heel. Therefore one's instinct is to say that the Government have done something dastardly and really should not have overturned this finding. But I think that, when we look at this in greater detail, it is not so simple as that.
It seems to me that the Statement does touch on the important parts of this problem. The sentence which deals with the restriction of competition, which, after all, is the important matter when it comes to a question of monopoly, seems to me to answer a very large part of the questions that might be asked. The final sentences, which deal with the situation in Scotland, also answer pretty fully some of the questions that might well have been asked by my noble friends who look after Scottish matters. Provided that the interests of Scottish industry are being looked after properly—this is a serious judgment which the Government must come to in this matter, and they will be judged in retrospect, as to whether they have

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come to a proper conclusion—I think, on the whole, although one's instinct is to attack the Government, it may well be that, bearing in mind the integrity of the chairman of the commission, who is an independent-minded man if ever there was one, the Government have come to the right conclusion on this occasion, and from these Benches we would not wish to push the matter any further.
4.10 p.m.
Lord Trefgarne: My Lords, I am obliged to the noble Lord, Lord Tordoff, for his response to this Statement and, indeed, to the noble Lord, Lord Underhill. First, on the question of assigning responsibility for this decision, which my noble friend chose to do on this occasion, there is very good legal precedent for that. A number of cases have produced decisions in support of that arrangement and, indeed, it has long been the practice that such a thing can be done. I shall be happy to provide the noble Lord with detailed legal references, if he would like to see them. As for my noble friend's personal position in this matter, which the noble Lord, Lord Underhill, chose to question, my noble friend has, of course, acted with complete propriety in this matter right from the very start, and that is why he delegated this decision to my honourable friend Mr. Rees.
As to the merits of the case, which the noble Lord, Lord Underhill, complained of as well, it is a fact that it was necessary to determine where the public interest lay in this matter and it was incumbent upon the MMC to show that the public interest would be damaged if this merger were allowed to go ahead. I think my honourable friend was right to conclude that the evidence adduced in the report, and the conclusions drawn from that evidence, were not sufficiently strong to enable him to draw that conclusion. I am convinced, therefore, that my honourable friend made the right decision.
Lord Harris of Greenwich: My Lords, is the noble Lord aware that, although many of us take the view that it may well be right to question the judgment of the Government in this matter—and one can understand some of the anxieties which have been, and will be, expressed in Scotland on this question—we share his view, and the view of my noble friend Lord Tordoff, that there is something rather squalid in some of the personal attacks which have been made on the Secretary of State in the past 24 hours? Although many of us may differ from the noble Lord on matters of policy, no one could conceivably question his honour.
Lord Kaldor: My Lords, I should like to associate myself——
Lord Trefgarne: My Lords, I think that it would be in order for me to intervene at this moment. I am grateful to the noble Lord, Lord Harris, for that intervention, with which I agree.
Lord Kaldor: My Lords, I should like to associate myself with what the noble Lord, Lord Tordoff, has just said. I consider that the Secretary of State's
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holding of shares in a particular company is a trivial matter, and I am sure there is no question that it has played any role in the decision. But, personally, I very greatly regret that, perhaps out of a misguided sense of propriety, he sought to divest himself from any responsibility for the decision. For, unlike earlier speakers, when we come to the substantive issue, I fear that the Government's decision was a thoroughly bad one, for reasons which I shall proceed to explain. Had he approached the matter with his knowledge of economics and his general views as to favourable and unfavourable factors for the economic development of this country, I am quite sure that the noble Lord, Lord Cockfield, would not have come to the same conclusion as his Minister of State. So it is unfortunate that he did not deal with the matter.
Contrary to what some speakers have said, I find the arguments advanced in the note of dissent against the majority report extraordinarily weak. I should like to quote one or two sentences from the note of dissent:
"Charter, despite its policy of building up or acquiring subsidiary industrial companies, is still to a large extent a financially-orientated investment company. Anderson Strathclyde is a specialised engineering company. We do not dissent from this description of the companies, but we do not consider that any inference is to be drawn from it adverse to the proposed merger".
This is an extraordinary statement. This country, as is well known—I have put forward this view without contradiction on numerous occasions—has suffered for many years from the excessive influence of financial capitalism as against industrial capitalism. It has suffered too much from takeover and merger activities whose sole purpose has been to build up and enlarge financial empires. This has served to dissociate specialised knowledge, loyalty and devotion to a particular sphere of work from the ownership of companies. In the 1970s, and earlier, we had an orgy of takeover bids. It is now generally known—
Several noble Lords: Question!
Lord Kaldor: I apologise. If I may finish the sentence, I shall then proceed to my question. It is generally known that the effect of such takeover bids by financial investment companies is wholly adverse to most industrial relations and to the dynamic and expert management and development of industry. This is a case in question. Is there any reason why a South African multinational conglomerate whose main interests are in gold and diamonds should acquire an industrial engineering company in Scotland? I do not see that the case has been made out. There is every possible argument to the contrary.
Lord Trefgarne: My Lords, I do not see any reason why this company should not acquire Anderson Strathclyde. A number of possible ill effects have been pointed to, but they are all purely speculative. For example, the suggestion that the management of Anderson Strathclyde would suddenly collapse under the new ownership does not seem to me to be a proven assertion. Of course mergers occasionally bring some management difficulties which have to be ironed out, but I see no reason to believe that those difficulties would be any more acute in the case of this company, which is to remain a Scottish company with its registered office in Scotland.
Lord Oram: My Lords, while I agree with those who have said that the noble Lord, Lord Cockfield, has acted perfectly responsibly and honourably in this matter, is there not a procedural point upon which with hindsight, he—the noble Lord, Lord Cockfield—might reflect? When it occurred to him that because of his, I acknowledge quite small, shareholding he was unable to fulfil his ministerial duties under the Fair Trading Act 1973, and decided therefore to pass these matters to his junior colleague, ought he not at least to have come to this House to make a personal statement of his position? This would not have been debatable, but it would at least have been an expression of his responsibility in this House.
Lord Trefgarne: My Lords, all departments of state make a large number of decisions every day of the week—some large, some small. Very many of those decisions are delegated to junior Ministers, and many more are delegated to officials in the department. It has long been established by tradition that this is an appropriate way in which to proceed. Indeed, it has long been established by the courts that this is an appropriate way in which to proceed—and this was the way in which my noble friend chose to proceed on this occasion.
Lord Hatch of Lusby: My Lords, in the Statement repeated by the noble Lord, Lord Trefgarne, mention was made of national interest and, in his replies, the noble Lord has spoken of public interest. May I ask him whether the Government have not considered that the national interest and the public interest will be gravely damaged if the British Government are seen to be facilitating the takeover of a Scottish company by a South African company which inevitably has been giving strength and support to the policy of apartheid and which was known to be supporting the illegal régime of Ian Smith in the then Rhodesia? Is this feeling of shame in this country not likely to be strengthened by the news of the activities of South African agents, revealed in the courts last week, and the invasion of a fellow member of the Commonwealth, Lesotho, at the same time?
Lord Trefgarne: My Lords, the noble Lord, Lord Hatch of Lusby, raises points which are wholly irrelevant. There is nothing to prevent British people from investing in South African companies or in companies which have interests in South Africa. There is no law against that. The shareholders of Anderson Strath-clyde are perfectly entitled to sell their shares where they will, subject only to the provisions of the Fair Trading Act which we are considering today. It was on that basis that my honourable friend took his decision.
Lord Hatch of Lusby: My Lords, with respect to the noble Lord, Lord Trefgarne, that is no answer to my question. I asked whether he had considered, on behalf of the Government, whether the national interest and the public interest would not be damaged by the revelation that the British Government were facilitating the incursion into industry in this country of a South African company.
Lord Trefgarne: My Lords, the answer to that question is. No. The South African element was in any event considered in the report, and I would refer the noble Lord to paragraph 9.13.
Lord Campbell of Alloway: My Lords, is my noble friend aware that public interest as defined by the relevant statute does not embrace the kind of political situation on an international plane to which reference has just been made?
Lord Trefgarne: My Lords, my noble friend is, of course, quite right.

Nuclear Forces: Geneva Negotiations
4.24 p.m.
Debate resumed.
Lord Gladwyn: My Lords, I must start by apologising for having missed the splendid oration of my noble friend Lord Mayhew, although, broadly speaking, I think I knew more or less what he was going to say! I was late because I thought the Statements were not going to be taken when they were. In the 10 minutes available, I shall simply make a series of generalisations, which I fear some of your Lordships may find contentious, but which I myself believe to be relevant.
First, I feel that the Russians are almost as frightened of us as we are of the Russians. Deep in the Russian consciousness lies the fear that Russia may once again be assaulted and almost overwhelmed by the West, as she was in 1912, in 1941 and, as some would say, even in 1918. It is chiefly, therefore, for this instinctive reason that the Russians have built up their nuclear and conventional strength, so as to deter the West and not necessarily, or only, for the accompanying ideological reason—dear to the hearts, no doubt, of some of the leaders of the despotic régime under which the Russian people have groaned since the formation of the Russian State—that Russia is in some way destined to triumph, this time under Soviet leadership, all over the world.
I also feel that even these Russian ideologues, so to speak, cannot actually want to have a war with the West if it can possibly be avoided, for, if the war was nuclear, Russia would be obliterated, and, if it was merely conventional, the Union would at least be cut off" from her external trade, above all grain, and thus would face, even if victorious, a potentially disastrous situation. She might also face an appallingly difficult war with China. What the leaders undoubtedly do want is to promote the collapse of the West if they can, and the best way of avoiding that is to see that our rival economic system works efficiently.
True, the aggression against Afghanistan would seem to support the view that the Soviet Union is now embarking on a regular policy of conquest, but this is by no means certain. We must, after all, remember that we ourselves, for imperial reasons, on more than one occasion invaded Afghanistan in the past, the last time with pretty disastrous results. We must certainly do our best now to see to it that the inexcusable Soviet

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aggression does not pay and that some sort of Afghan independence is eventually restored. And we must back up the Afghan people in their heroic resistance to the limit of our effective power. But I do not think we may expect any very similar exploits on the part of the Russians in existing world conditions. In other words, I hardly think that the Russians are now likely to risk another Afghanistan.
Poland, too, does not really support the suspicion that the Russians are all out for world conquest. Either we accept a kind of Russian hegemony over Eastern Europe or we do not. The brutal suppression of democracy in Hungary and Czechoslovakia was, it must be accepted, at least tolerated, even if unwillingly, by the West, at a time, incidentally, when the West had a great nuclear superiority. Poland, no doubt largely owing to Western pressure, has at least escaped Russian occupation, which is something. But beyond continuing to exercise such pressure I do not think the West can go, unless it has really decided to destroy all Russian authority and influence in Eastern Europe and to take the measures necessary to achieve this end—and that, of course, could mean war.
But maintaining economic and political pressure in order to induce the Government gradually to liberalise, or at least render less intolerable, the conditions in the countries in their zone of influence is one thing. Building up a nuclear superiority in order to compel them to do so is quite another. Certainly, we have to make it clear that we are in a position successfully to defend ourselves, and indeed our own vital interests, by one means or another, anywhere in the world. But that does not mean that we should regard the Soviet Union as enemies of the human race in the same way as we regarded Hitler and the appalling Nazi gangsters. They could be suppressed only by war. So might the Soviet Government be suppressed if one really believed that they were the equivalent of the Nazis. But, owing to the vast extent and indeed the power of the Soviet Empire, it is unfortunately likely that the West would also perish in any such attempt.
So it follows—and this is my main point—that some sort of understanding or truce, if you will, between the super powers, however difficult, is the only sane solution. It is, in fact, a total absurdity for either side to attempt to build up some sort of nuclear "superiority". Given broad nuclear parity, for example, which I believe now more or less exists, all that is really necessary for the purpose of deterring the adversary from using nuclear weapons against oneself is the possession of sufficient indestructible nuclear weapons to devastate one's opponent on a second strike. These might well be chiefly submarine. And clearly in such calculations all nuclear forces at the disposal of the West should be regarded as a whole. Of course they should.
True, broad parity in the so-called conventional field is also necessary. Here again, it is surely unnecessary to build up, as the Russians have certainly endeavoured to do, any vast superiority of power. All that the West wants, in fact, are enough conventional forces, or power, to make it clear that the other side would be unlikely actually to win a non-nuclear war. One does not have to match the Russians tank for tank or even, for that matter, man for man. What we need
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is a new kind of forward defence embracing, in quantity, all the anti-tank and anti-aircraft weapons and devices that are now, or could shortly be, at our disposal.
Such a general strategic concept certainly involves the possibility of a war confined to the Continent and to the oceans. That is why, as we all know, it may be suspect to the Germans. But if it can, broadly speaking, be accepted as valid, there is little reason to suppose that any such war will ever take place. In any case, and pace the Germans, we must all face the fact that, however destructive, such a war would be infinitely preferable to any nuclear exchange, which would almost certainly result in the virtual extinction of the Western European democracies.
I repeat, I believe the Russians are probably now as frightened as we are and I have no doubt that there would be "peace" demonstrations in the Soviet Union if the country were not in the iron grip of the KGB and largely intoxicated, I fear, with anti-Western propaganda. Some Russian generals may possibly be thinking in terms of the eventual conquest of the world, but I very much doubt if such silly dreams dominate the thinking of Mr. Andropov's Politburo.
What should we do? Here, I can only express myself in shorthand. As I see it, we should in the first place abandon Trident, which, from the general point of view of the West, is a waste of money, productive of totally useless overkill. Second, we should abandon "flexible response", which is essentially based on a willingness, in the last resort, to perform national suicide, and proceed with our European allies to strengthen our conventional forces on the Continent. Third, we should revise our latest Falkland-induced worldwide strategic plan on the chief assumption that we simply cannot afford, for long, to deploy at great expense a large task force in the South Atlantic. Fourth, if, but only if, it is clear that the present negotiations are failing owing to Soviet intransigence, we must accept some cruise missiles here, on condition that some sort of "dual key" control system is introduced, based, presumably, on the principle of "no obliteration without authorisation". But, fifth, we must try our best to induce the Americans to conclude some deal involving a compromise on the original "zero option", and at least take Mr. Andropov's latest proposals seriously for a start.
Sixth, we must declare that we ourselves, at any rate, will never authorise the first use in war of any nuclear weapons at our sole or, indeed, at our joint disposal. Seventh, and lastly, we must rally the nation against the CND—which, by imperilling NATO, really might result in our defeat—by popularising the kind of non-nuclear but defensively effective programme which I have outlined.
We must explain that a nation which, at a moment's notice, could repel aggression many thousands of miles away is entirely capable, with her allies, of successfully resisting any non-nuclear assault on these islands. More especially would this be so if our young people can be persuaded to take the defence of democracy seriously and, for instance, take part—as I think was half suggested in the speech of the Secretary of State for Defence in the other place only yesterday—in some scheme for a new kind of home guard or extended territorial army to protect our own

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centres against attack from the air in the event of war, which, if all the measures that I have proposed are taken, will in all probability never occur, the danger of a conflict between the super powers having been finally averted.
4.36 p.m.
Lord Beloff: My Lords, it would keep us here a long time on the day on which we are thankfully "breaking up"—if I may use that analogy—to deal with all the many and interesting points which the noble Lord, Lord Gladwyn, has put forward on the somewhat slender substructure of a Question about a particular set of negotiations on disarmament. But that does not mean that on some future occasion it will be irrelevant to enter into this broader field.
I personally am slightly interested, or puzzled perhaps, by the motives of the noble Lord, Lord Mayhew, in raising this Question at this particular juncture because it seems to me at least possible that his motives are connected—and it is perfectly legitimate that they should be—rather with the internal political situation in this country and the position of his own political party, than with the great issues of international affairs.
I recently received from a gentleman who describes himself as a card-carrying Liberal and also as Treasurer of the Lewes, Sussex, Group of CND, a long letter in which he explains the reasons why that movement is now resorting to various forms of direct as well as political action, and in the course of which he says:
'We have worked at party politics too. We have won over the Labour Party. We have gone a long way towards winning over the Liberal Party.".
It seems to me that today's Question by the noble Lord, Lord Mayhew, represents an attempt to deal with this takeover bid by the CND by trying to find common ground which might exist between the unilateral and the multilateral. It is, therefore, not surprising that he finds himself to some extent allied, rather improbably if one looks at their different philosophies, with the noble Lord, Lord Jenkins of Putney.
Lord Mayhew: My Lords, as the noble Lord has referred to me, would he be good enough to give way? If it were my motivation, as he suggests, to appease the CND elements, surely I was greatly mistaken in attacking the unilateralists with the vigour that I did in my speech?
Lord Beloff: My Lords, I should not have thought that that consequence necessarily follows. There are various ways in which to deal with political movements, some of them more subtle than others. After a long acquaintance, I would associate the noble Lord, Lord Mayhew, with subtlety. But I do not think that, in pursuit of his laudable objective, he has done his cause, or rather the cause of multilateral disarmament—which is his, mine and I hope the cause of the majority of noble Lords—a great deal of good by going on to suggest that the rather lukewarm reply (not total dismissal, as he suggested and as I think the noble Lord, Lord Belstead, will indicate) to Mr. Andropov's latest set of proposals, arises from some failure of temperament or ideology in either the President of the
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United States of America or the Prime Minister of the United Kingdom.
I do not think it is my business or, indeed, the business of any noble Lord to speak up for or explain the position of the President of the United States of America. All one can say is that at the very moment when the noble Lord, Lord Mayhew, says that he attaches such importance to cementing the bonds of our alliance, a personal attack upon the head of state of its leading member is perhaps in this case not a very subtle way of going about achieving that admirable end.
Lord Gladwyn; My Lords, is the noble Lord not aware that a great many Americans do not themselves approve of the policy of their President, and say so most emphatically?
Lord Beloff: My Lords, what is permitted to the citizens of one country to say about their Government takes on a different picture when the same thing is said by politicians in another country. There is quite a gap between an internal domestic debate, in which clearly Americans have every right to criticise their own President, and trying at one and the same time to say: "We wish to cement our alliance with the United States, but we think the President is temperamentally and ideologically unqualified to deal with a serious situation." As I said, I do not regard it as my business to pursue that argument.
What is my business—and here I would like to protest in the strongest terms on behalf of myself and my noble friends—are the remarks about our Prime Minister. There is not a shadow of reason to believe that the Prime Minister is less dedicated to the pursuit of peace through multilateral disarmament than any single one of her predecessors, whether those named by the noble Lord, Lord Mayhew, or whether those not named. It would, indeed, be incredible if anyone who held high office in this country was not primarily concerned to protect us and to protect our peace. To make these remarks rather than to pursue the problems which Mr. Andropov's statement represents, seems to me to be wide of the mark.
In view of references that have been made to recent history, it seems to me fairly obvious, and something which one could almost document, to say that if the three countries concerned—the United States, the United Kingdom and Germany—had still had at their heads President Carter, Mr. Callaghan and Herr Schmidt, the response to Mr. Andropov would not have been significantly different.
I entirely agree—and, again, this makes today a red-letter day—with the remarks made by the noble Lord, Lord Jenkins of Putney, that clearly we cannot examine any proposal for multilateral disarmament, or for any other aspect of our relations with the Soviet Union, unless we do our best to enter into their minds; to some extent the noble Lord, Lord Gladwyn, went down that path as well. But, of course, in order to do this successfully one has to be wholly au fait with the actual situation that exists, both as it exists and as they, in their turn, no doubt see it. I find it difficult to accept the view which the noble Lord, Lord Jenkins, put forward, that there has been no important change in

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the balance of forces in the world over the last decade, except the installation of the SS20 intermediate range nuclear missiles.
It seems to me, if you look at the figures, that there has been a greatly increased vulnerability in the case of the American strategic deterrent—certainly its land-based element; there have been many changes in the last decade, as my noble friend Lord Thomas pointed out, in the Soviet Union's capacities for conventional warfare, whether on land or on sea; and if one looks at the crudest of all measurements, the proportion of national expenditure devoted to defence, one sees that for a decade in almost every year, with one or two exceptions, that has been a great deal higher in the Soviet Union than it has been in the United States.
I do not jump from this to any conclusion about possible aggressive intentions by the Soviet Union. I believe that Mr. Andropov is almost as peace-loving as Mrs. Thatcher, and that is putting it high. I believe that he desires to preserve his régime and the comfortable position for himself and his friends in the KGB at which they have, after strenuous effort, at last arrived. Therefore, I assume that the Soviet Union, in building up this panoply of force, is well aware of the political gains that may be got from it, and equally well aware of the heavy economic pressures that it entails, as on the other side, the pressures which our own and our allies' rearmament entails for our own economies. Therefore, I am inclined to believe that the Soviet Union would genuinely like some kind of reduction in the overall burden.
Therefore—and I believe that the Foreign Secretary said that we must look at this—any proposal that they make must certainly be looked at to see whether it indicates even the remotest possibility of some route to an agreed reduction. It may well be that, when looked at, we shall find that the advantages that the Soviet Union maintains are not sufficiently reduced by these proposals, and that we should need to go something nearer to the original proposals put forward by the United States. But certainly that is a matter open for discussion, and for discussion on the assumption that both sides have a common interest in multilateral reduction.
Where I differ profoundly from the noble Lord, Lord Jenkins of Putney, and I can see how difficult he and his friends have made the position of the noble Lord, Lord Mayhew, is that we cannot disregard the other aspect of this; that is to say, the orchestration, of which this is a part, of protest against the West's own efforts to build up a countervailing force until that agreement is reached. There is something there which it is difficult for the protagonists of unilateral disarmament to argue away, and that is the simple fact that, until the two-track initiative of 1979, in the immediately preceding years, there were years of a serious and important build-up of Soviet nuclear weapons targeted on Western Europe. During that period those who now object so vociferously to our own preparations took no action, made no statement, and issued no denunciations. That is why, although no doubt there are many people who have seriously been brought to believe in the imminence of nuclear war, about which I have total scepticism, it is also the case
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that there is in the Andropov proposal, as the noble Lord, Lord Thomas, pointed out to us, an element of propaganda, and that it will be the business of our negotiators to find out what is serious and what is propaganda.
4.49 p.m.
Lord Kennet: My Lords, may I apologise first to the noble Lord, Lord Mayhew, for having missed his speech. That I did so was due to a misunderstanding about when this debate was likely to begin. The negotiations which are the subject of this Question are now being conducted in public. This means that Mr. Andropov believes that he now has a better case than President Reagan, and that I think is probably the reason why he has taken the step, which is not very common in Moscow, of switching (without, of course, any declaration that he is doing so) from private or secret negotiations to public negotiations.
If the press reports we have are correct—and these days they are not often correct—there are among President Reagan's advisers in Washington those who believe that the European Peace Movement—whatever that means; we all adopt our own definitions of it—was quieted by the announcement of the zero option and the beginning of the IMF negotiations about a year ago. I certainly count myself part of the Peace Movement, and I think that probably even the noble Lord, Lord Beloff, would if it were rightly defined. I was quieted for a little while at the beginning of those negotiations. One could not but applaud the fact that after a year in office the Americans had come to the table, and the Russians had come to the table, too, and that a Western offer had been put down. It was good news, and it was seen by a wide spread of opinion in Europe as being an acceptable opening bid in the negotiations. I do not think it has ever been accepted by anybody, including the American and British Governments, that it was to be both the opening bid and the final offer.
The problem at the moment, and the disquiet in Western European opinion, is due, I believe, to the fear that it may be going to be the American final offer. We are familiar with the strand of American thinking and policy which says, "If the Russians are going to make a useful offer, they will do so at the eleventh hour", meaning just before the cruise missiles become operational in this country and the Pershings and cruise in Germany, and so on. There are even those in Germany who say, "If the Russians are going to make a useful offer, they will do so at the thirteenth hour", that is, after the cruise and Pershing 2 systems in Germany have become operational.
I do not think we can any longer believe that is the case. Within a month of coming to power, Mr. Andropov has made two very public and noticeable proposals. He is not moving at the last moment: he is moving now, and it is up to our Governments to see what we had best do about that. We must listen with exceptional care to what is coming out of Moscow, because of the change of ruler. So much is obvious. Perhaps it is the conventional wisdom in Washington, but, at any rate, many people in Washington, including the Administration's advisers and spokesmen, believe that Mr. Andropov is clearing out Mr. Brezhnev's dead wood and that the new attitudes he

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takes up and the sound of heads about to fall, which is audible, are the fruit of his determination to get rid of all traces of the old régime.
It may be that that strand of opinion is missing the point. It seems obvious that Mr. Andropov's rival is not a dead man; his rival is probably, in my opinion, Marshall Ustinov, the Soviet Defence Minister. Marshall Ustinov has been telling the world that the Western deployment, especially of Pershing 2s, will force the Soviet Union to adopt "launch on warning"; and his utterances are becoming familiar. They are extremely alarming and bellicose. He ignores the fact that we have lived under precisely the same threat, of six-minute or ten-minute flight time of Soviet missiles, since about 1970, with the SS 4s and 5s. We, as the Government rightly state, never threatened to launch on warning when those missiles were first trained against us.
The adoption of such a bellicose line by the Soviet Minister of Defence can only tell us something about what is going on inside the Soviet Union. Marshal Ustinov in effect (if one reads carefully what he says, and it is essential to do that) threatens to breach the hot line agreement and to breach SALT II, which the Soviet Union maintains it is observing, though it is unratified. I will not detain the House by explaining in detail what I mean. It is all there in his speeches.
Mr. Andropov does not do any of that. If we face up to the fact, we are really being offered two Soviet Unions. We are being offered a choice of the Soviet Union with which we want to deal. It is important that the Western Governments should choose the right one, and it is rather easy to see which is the right one. If we talk back to Marshal Ustinov in his own language, we risk making Mr. Andropov his prisoner. Some of us are already talking back to the Soviet Union in "Ustinovite" language; and I do not mean only the right wing in our respective countries. I mean also, curiously enough, the headline writers in some of our most respected newspapers.
We had no copy of The Times today, so I was able to compare the treatment of Andropov's speech yesterday in only the Herald Tribune and the Guardian. In both cases the stories were careful and, so far as I am able to say, mainly accurate, though not entirely. The headlines in both cases were widely misleading, in that, for the second time in 10 days, the Guardian said that the Americans had flatly rejected Andropov's proposals, and the Herald Tribune said that Britain, Germany and France had flatly rejected Andropov's proposals. We may be glad that none of those Governments has done anything of the sort. I believe that if they did, it would be the recipe for tearing NATO apart within about three, or possibly six, months. One thing that we must avoid on this occasion is a flat rejection of anything; and to say that is not to state that we should put forward an immediate acceptance of anything, either.
What do we think the Russians make of NATO? Is it not likely that they think that it is probably rather like the Warsaw Pact, which is something that they know better? To them the only strategic targets are in the United States. To them the long-standing language of theatre and non-theatre nuclear weapons is still in use, though we in the West have, luckily, given it up.
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The Chinese seem to understand all this clearly, but we have to remember that the Russians do not, and try to get it across to them that the two Alliances do not resemble each other.
The main way in which they do not resemble each other is that there is no Polish independent nuclear deterrent and there is no Czech independent nuclear deterrent. In Britain and France there are such things. Other ways are perhaps too obvious to be worth mentioning. It is a fact that the Soviet Union single-handed conducts the affairs of the Warsaw Pact. It is not a fact that the United States single-handed conducts the affairs of NATO. The Russians must never be allowed to forget that difference.
At the risk of a bit of "I told you so", I want today to recall how in the early seventies, again and again, I bored this House by pointing to the arrival of the SS 4s and 5s, by clamouring against the imbalance in intermediate-range ballistic missiles, by saying that they were going to give trouble some day—and, by God!, they are doing now—and by asking why it was that the Governments of the West would not agree to ask the Russians to take them away.
I never suggested that we should meet this new problem by building our own forces to match the old SS4s and 5s. I did ask—and repeatedly—that somebody, somewhere, in some set of negotiations, should take those things into account. Conventional forces were being negotiated about. The SALT talks were going on. But at that time nobody was talking about the Soviet intermediate—range ballistic missiles. Now they have, of course, begun, and we have the dual-track decision and the deployments, about which all the present agitation takes place, in the face of the SS20 deployments on the other side.
There is a bit more "I told you so", and then I shall be finished with it. Again and again, since December 1979, I have bored this House, and perhaps worried the Government on occasion, by asking for a British safety catch on the cruise missiles when they are deployed. I ask for it again today. I go back to the Thor missiles of all those years ago; around 1959 to 1962, they were here. In preparing the British Parliament to receive those American missiles, the distinguished ex-Minister who is now the noble Lord, Lord Duncan-Sandys, promised that there would be "joint positive decision of both Governments", and indeed when they came here the system adopted was that of British ownership and manning with one American permanently present at each weapon with a key to permit the arming of the warhead and to permit the countdown to proceed beyond a certain point. If these American weapons are to be here in American ownership, a proposal which I have never disputed for its own sake, then I think that the least we can ask for is that that system should be applied in reverse; that there should be one British person present with each missile or with each launching console (or whatever modern technology has) who should be physically able to discontinue the countdown at a certain point unless he receives direct orders from his own Prime Minister to continue.
I am fortified in this proposal by believing that we in this country are not even too sure what happens if the President and Vice-President of the United States have

1147
disappeared. Perhaps the Government could even give us a bit of an answer today. If the President and Vice-President have disappeared in a nuclear exchange and our weapons, the American weapons on British soil, are still here and still intact—a not unthinkable scenario—who gives the order to launch? Unless there can be some clear answer to that, then it is perfectly obvious that there must be a British finger on the safety catch. Indeed, I think it is obvious that Parliament must have the right to decide this question at a moment which is not too late. The American-only trigger on the safety catch, no European finger on the safety catch, emphasises to the Russians the Americanness of the weapons; it gives them a great arguing point, possibly a bargaining point.
This is a perfectly genuine quandary because it is true that the American intermediate-range missiles in Western Europe will have a different effect on the super power balance from the effect exerted upon that balance by the Soviet intermediate-range missiles in the Soviet Union. The American missiles can reach the other super power; the Soviet missiles cannot reach the other super power. Nothing can change that; nothing that the Russians can say about it can make that fact a tainted fact. It is a true fact.
There is one further possibility I want to touch on before concluding—and it is back to this question of relations between Andropov and Ustinov, between, in effect, the KGB and the army in Russia. At certain times in the modern history of the Soviet Union, we in the West have had good reason to believe that the civil arm of government did not always know what the military was doing. During the SALT I negotiations, there was an episode which has become rather famous, when the Soviet military said to the American military in private in the evenings of the negotiation; "Here are some facts which we would like you to know but, please, will you not pass them to your civilian arm because our civilian arm does not know them?"
At moments during the process of Andropov's establishing his supremacy over the army in Moscow—which, I believe, might have been quite a tense process—it has seemed possible that something of the same sort may be happening again. If it were, there might even be a case for the Foreign Secretary in the privacy of his own room to tell his opposite number, the Soviet Foreign Minister, some of the things that he knows about the Soviet military, in case Mr. Gromyko does not.
What we need in my view, as it has always been, is an early and intense relationship between the three sets of negotiations, START, INF and MBFR and, possibly, an amalgamation of all three. I have never seen any objection to that. The Russians, we have to admit, did have an attractive, if specious, point about their offer to reduce their SS-20s to a number equivalent to the number of nuclear missiles now held by Britain and France. It would in no way prejudice our position about the reduction or final elimination of those two European forces if we were now to call for the joining up of START and INF and for the presence of Britain and France in those negotiations.
1148
Of course there is a lot to be done before we can properly come to that. It appears at the moment that France would not agree and Britain would not agree. There is always hope for widening the field. Progress is subject to widening the field. The negotiations, whether public or private, are at the moment thwarted and set back again and again by the existence of capricious frontiers between one set of weapon systems and another. Every set of weapons systems, every different range of missile, the location of every different type of platform—on the sea, under the sea, in the air and on the land—are all matters which must be related to each other. It is impossible to pick out one and say: "Let us pretend these two things are equivalent without reference to their surroundings and let us negotiate about them".
To continue to insist on doing so at the present moment would be a recipe for continued deadlock in real disarmament negotiations, and such a continued deadlock would risk destroying the very political alliance on which we rest our hopes for the defence of our way of life. This is a way of life which, let us remember, may be destroyed not only by physical means but also by the mere threat of the use of such physical means.
5.7 p.m.
Lord Bishopston: My Lords, this debate is timely because the whole country is concerned about peace. In recent times those who have dared to mention the word "peace" or who have been known as peace lovers, have been, in the minds of some, the objects of ridicule. I think that now, only a few days from Christmas, we should be able to say that many members of the party opposite have been found sending messages concerned not only with expressions of peace but also of goodwill. So we may therefore assume that the word "peace" is acceptable for a few days, at least over Christmas. But very soon in the New Year reality will break through, blest, we hope, with the Christmas message.
If I summarise what I want to say, and what has been said by various noble Lords—including the noble Lord, Lord Mayhew, to whom we are indebted for this debate—it is a matter of saying, "Let us keep our options open and avoid getting into the rigid pockets or groups which tend to fossilise our thinking in a fast changing world situation". We all need to think for ourselves, to think again and to break away from those rigid barriers. The noble Lord, Lord Kennet, was pursuing much the same theme.
This subject is not a seasonal one although it is dealing with peace which is on the lips of many people at this particular time. But we need to keep our perspectives, because, although we are rightly concerned about the threats which face mankind and what we can do to maintain the peace and security of our way of life, other people have other things in mind at the same time. The problem is to make people more aware of the situation in a serious way while recognising their own point of view. At Christmas time the world is a better place. I think that it is better because it is less concerned with missiles and more concerned with mistletoe. Fewer are sensitive about stockpiling and more are toying with ideas for stocking fillers. After Christmas, after the Christmas meals,

1149
more people will be reaching for detergents than for deterrents. I suspect that even the Prime Minister will be less strident about Trident on Christmas Day—and long may that be the case! We want to make sure that peace is not only on the cards at Christmas but throughout the whole year. That really is the motive behind this debate, because we all have concern for policies which will pursue the path of peace and our way of life, keeping perspectives.
As I say, this debate is relevant this afternoon because of the vital importance of keeping a future with peace and goodwill and of ensuring its reality. I think we should keep our options open and, with the changes that have taken place in the leadership of the Soviet Union and with a President of the United States who seems to want the United States of America not only to be an independent power in matters of defence but, indeed, does not always have the number of consultations with others that some of us would wish, it is opportune that we should be seeking new initiatives from our Government. The fear is that, far from taking new initiatives, the Government are not responding to those which are coming forward in a rapidly changing international situation. They may not come again for some time; and in the meantime there will be nuclear proliferation and indeed new threats to world security and peace. I think the noble Lord, Lord Mayhew, and others were rightto express concern at the attitudes of the United Kingdom, of our own Prime Minister and of the United States President in these matters of closing the options so quickly. When one talks, as the noble Lord, Lord Beloff, did, of the view of the United States people, of course the President has not yet got both Houses of Congress to agree to his MX missile proposals, which deserve a great deal of consideration.
The question we are discussing is whether, to the Government's knowledge, the Soviet Union has proposed in the international nuclear forces reductions negotiations, to renounce half their SS-20s, and whether the Government will comment. That is something we certainly need to have more information about when the noble Lord replies. We know that the two main difficulties about the MBFR discussions are the data problem of getting agreement on the force levels, and verification. Of course it may be very difficult to agree as to whether the Eastern or Western European forces and weaponry are greater and, if so, by what amount. There is merit in ensuring that when reductions are made on either side the aim should be to reach parity on both sides. But in the absence of agreement the fear and the reality is that both sides will go on building up their forces and leading, as I say, to proliferation as an outcome; and provocation is a likelihood as well.
There can hardly be disagreement surely, even by the noble Lord, Lord Beloff, with many of the things I have said so far. That is essential because we should all be looking at proposals put forward by Members on all sides and from all points of view, to see how they affect the situation that we have. The problem of data assessment, as I say, is to decide the relative value in defence terms—the quality and quantity of resources on both sides on defence. As the noble Lord, Lord Mayhew, has said, NATO has a strong submarine-based missile capability, but at the same time the
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USSR have SS-20 missiles which can be sited, as they are, behind the Urals and can still be focused upon the European scene.
It is very difficult in that situation to work out who has what; and I certainly hope, as no doubt do many others, that this will not deter us from new initiatives and new alternatives in the meantime. It would be helpful if the noble Lord, Lord Belstead, when he replies, would be kind enough to give us more information about the Soviet proposals. It would be useful to know when they were made, what detailed discussions there have been about the assessment of the forces on either side and about the problems of verification, and also details of any other alternatives we might have put forward if we could not accept the Soviet proposals—I am not suggesting that we should have accepted the proposals out of hand—and how long those discussions have taken place. Mr. Andropov has been in office for only a fairly short time, but this Government and the United States Government seem to have made up their minds very quickly that they will not accept the offer and that that is the end of the story, when the negotiations on the alternatives should have continued for a little longer.
The House wants to know, and has a right to know, about the Government's thinking on matters of defence which are likely to be relevant in the next few months. We all know that defence matters do not stand still, and it is necessary to know the principles of the Government's defence policy, which may apply not only to the problems but, also, to the opportunities which arise from time to time. As has been said, we are indebted to the New York Times and to the press, in general, for leaks about some of the proposals, including the claim that the Soviet Union's proposals are not acceptable. But whether acceptable or not, there must be room for the Government to follow up other suggestions for détente. I would certainly emphasise the plea made by others for flexibility in our options. In such matters, it is not unreasonable that the United States should have a view, but that does not imply that we should invariably go along with them. We should use the occasion to put forward other ideas, which we should canvas and press with our other NATO allies.
One fear arises from the fact that the President often acts independently. Of course, if he and we claim to have independent nuclear deterrents or weapons, that independence means that we can use them without consulting others, which is a most dangerous state of affairs when we are members of an alliance. One hopes that this so-called independence accepts the need for consultation at all times, because one cannot use nuclear weapons in a situation, without affecting other people and creating the events which will flow from them. So it is vital that we should consult.
I do not think that it helps when, on occasions, the Prime Minister says that the United States President has a rightto do what he likes with MX missiles and other defence projects without consulting us, especially, as we said last night in debate, when the bases from which some of these weapons will operate are of concern to us. I mentioned last night that the Prime Minister was correct in saying that the Falklands issue was one where Britain said: "We are not going to be pushed around". But it is also true in the defence field nearer home, where nuclear weapons

1151
are going to affect far more people than were affected by the Falklands issue, important though that was.
The offer by the Soviet Union with regard to the SS-20 missiles is worth studying, even if it is not acceptable. But it does not follow that, if one proposal is not completely acceptable, nothing should be done and that proliferation and greater problems are the only alternatives. We all know that the SALT and MBFR talks are facing difficulties, but we must use the new situation, with Mr. Andropov coming to leadership of the Soviet Union, the sometimes unpredictable thinking of President Reagan and the fluid position elsewhere, as opportunities for British initiatives. If we lose the chance to break through, another one may not come for a long time and, in the meantime, the situation gets worse.
In future talks on defence, the United Kingdom should press for non-proliferation, which is only one of the alternatives, and we should press for legitimate proposals for reductions. If we refuse to agree to offers from the Soviet Union, then the stockpiles will grow on both sides. I believe that the time has come to recognise the new opportunities and new initiatives which can be made by Governments. As the noble Lord, Lord Beloff, and others have said, one needs to try to understand the point of view of other people and to take that into account. But one thing we want to avoid at all costs is going back to the cold war mentality, which was so ruinous for the world for several decades in the past. Given the calibre of leadership which we have a right to expect from our Government, and with the co-operation of the United States, I believe that in the New Year we ought to press the new leadership of the Soviet Union to recognise the alternatives which are being put forward, and in that way give a new sense of realism and of vision for a more peaceful and secure future.
5.20 p.m.
Lord Belstead: My Lords, the noble Lord, Lord Mayhew, has raised a subject of great importance: the present state of the negotiations in Geneva on intermediate-range nuclear weapons. The majority of these weapons are based in Europe or are targeted upon Western European countries. In his speech the noble Lord, Lord Jenkins of Putney, asked us to look at the problem through Soviet eyes. The noble Lord claimed United States superiority in strategic systems. Such a Soviet claim cannot be upheld. The two superpowers have about the same number of warheads on the strategic ballistic missiles. However, the Soviet Union has some 25 per cent. more strategic systems. Therefore I think my noble friend Lord Beloff was right to make the point that during the 1970s the Soviet Union caught up with the United States at the strategic nuclear level: the inter-continental and sea-based ballistic missiles and the strategic bombers.
Since then the NATO Governments have had to weigh very seriously the prospect that at some stage the Soviet Union might calculate that in a crisis it could afford to gamble on blackmailing Western Europe by the threat of missiles, especially the SS20, which can reach Western Europe but not North America from bases in the Soviet Union. This gamble would be based
1152
on the Soviet premise that in a situation where there was no longer an American strategic nuclear superiority, the United States might hesitate to defend Europe with strategic nuclear systems based in the United States or at sea.
I should like to make it crystal clear that we have every confidence in the United States strategic nuclear guarantee of our security. But whatever the Europeans' faith, the issue turns not on that but on Soviet perception of the matter. The NATO Governments believe—I think rightly so—that the surest route to prevent any such Soviet miscalculation would be to station in Western Europe intermediate-range missiles which could hold at risk targets in the Soviet Union.
This was half of the decision: the so-called twin-track or double decision which was taken in December 1979. These NATO missiles could, so the foreign and defence Ministers of NATO decided, be limited in number: 572 is the total chosen, spread around five European countries, including our own. The Pershing 2 missiles, to be based in West Germany, would not be capable of reaching Moscow, and the ground-launched cruise missiles could not reach the Urals. So a first strike capability forms no part of NATO strategy. Even if the alliance were to wish it, these missiles are not a first strike force. They would instead bind more thoroughly the defence of the alliance as a whole in the face of a threat from the SS20 missiles of Russia, for since the double decision was taken in 1979 the Soviet Union has almost trebled the number of SS20s that it holds.
At the same time, NATO made a serious offer of negotiations with the Soviet Union to limit this class of intermediate-range weapon. A year ago, on the eve of the opening of the INF negotiations in Geneva, the West offered, through the zero option, to eliminate such missiles entirely. It is worth reflecting that it is very possible to verify a zero option, whereas, as my noble friend Lord Thomas of Swynnerton pointed out in his speech, Mr. Andropov was totally silent on the question of verification of his proposals—and, of course, verification lies at the very heart of the whole question of arms control. The West has said that, if the Soviet Union will remove the source of possible blackmail of Western Europe—that is, the SS20s and the earlier generation of SS4s and SS5s about which the noble Lord, Lord Kennet, spoke—then NATO will have no need for its insurance policy against possible blackmail.
Since the INF negotiations opened in Geneva just over a year ago, we have seen three rounds of negotiations, but, it is true, limited progress. The noble Lord, Lord Mayhew, ascribed this lack of progress to reluctance on the part of the United States' negotiators, but I do assure the House that that is not the case. We have not been surprised that the Soviet Government would hold back to see if political doubts in Western Europe would do the job for them by, in effect, scotching the plans of the Governments concerned to deploy cruise and Pershing 2 missiles. But the NATO governments have not changed their minds, simply because the source of potential blackmail has not been removed.
That is the reason for NATO policy and not the reasons which the noble Lord, Lord Mayhew, unjustly

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ascribed to my right honourable friend the Prime Minister and the President of the United States. The West, NATO, the Alliance, still believe that the zero option proposal is far and away the best aim for the negotiations, but we will examine carefully other proposals, provided that they are equitable. When announcing on behalf of NATO the zero option proposal, President Reagan said that the negotiators would listen to and consider the serious proposals of their Soviet counterparts. That promise still holds good.
Lord Jenkins of Putney: My Lords, if I may intervene, if the Soviet Union were to accept the so-called zero option, in the opinion of the noble Lord, would the Government be prepared to suggest to President Reagan that in return for that, the West should be prepared to reduce our huge preponderance of submarine ballistic missile launching platforms, which the Soviet Union obviously see as the reason why they need to have the SS20s?
Lord Belstead: My Lords, this is ground which the House has gone over time and time again. The INF and START talks are talks between the two major nuclear powers. We hope, we pray, we believe in and we are working for agreement in those talks by making the realistic proposal from the West of the zero option at the INF talks, and by proposals for deep cuts in the strategic systems held so far as the START talks are concerned. It is necessary to get agreement between the two super powers in those talks. Then will be the right moment to start thinking of other things.
Recently we have seen signs that the Soviet Government maybe realising that demonstrations in Western European countries will not lead to the NATO Governments cancelling their plans for strengthening our ability to deter aggression. Recently there has been the Soviet offer, about which practically all noble Lords have been speaking and which was confirmed by Mr. Andropov yesterday, of some reduction in the number of Russian missiles in Europe. The noble Lord, Lord Bishopston, asked if I would comment on this. If, for the first time, the Russians now accept the principle that their SS20s must be reduced before there can be greater security, this would be a small step in the right direction. But to demand a substantial continuing Soviet monopoly of longer-ranged land based missiles in Europe while insisting that NATO alone should implement the zero option is not a serious position. Even if the Russians reduced SS20 numbers in Europe to the level of about 160, as has been mooted, that would still be twice the size of the force that we faced on the eve of the double decision two years ago. There is thus every reason for us to continue with preparations to deploy the first of NATO's new intermediate-range missiles at the end of next year. I would remind your Lordships that NATO's programme to deploy cruise and Pershing 2 missiles is to be spread over five years and could at any point be amended, stopped or reversed, if agreement in the arms control negotiations warranted it.
I should like to add two points, if I may. The noble Lord, Lord Bishopston, asked for information about: the negotiations concerning the Andropov proposals. I really cannot stress too strongly that members of the
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United States Administration have kept us fully informed of all that has taken place in Geneva, including the informal exchanges which prefaced the offer which has now been spelled out by Mr. Andropov. During just the last four weeks, for example, we have received a full briefing in Brussels from the chief American negotiator, Ambassador Nitze. My right honourable friend the Secretary of State for Foreign and Commonwealth Affairs has had private discussions with the ambassador in London. The negotiations have been discussed by NATO Foreign Ministers at the North Atlantic Council. At the same time, NATO's Special Consultative Group, which is charged with monitoring the negotiations, was also meeting in Brussels; and, of course, we have had the advantage of discussing the subject bi-laterally again with Mr. Schultz here in London. So we really do believe that the present arrangements for full consultation within the alliance are working well, and we are confident that when the negotiations resume on 27th January the American delegation will be putting forward, as they have so far, the collective view of the alliance.
The second point I would make, if I may, is the one about British and French independent strategic nuclear forces being excluded from the negotiations—the point which the noble Lord, Lord Jenkins, raised just now. British submarine-launched ballistic missiles, like comparable United States and Soviet missiles, are strategic, and therefore have no place in the INF negotiations at Geneva. These negotiations are bilateral between the Americans and the Russians, and are concerned with the land-based missiles of those two super powers. The British Polaris/Trident force is a strategic nuclear deterrent of last resort, and is already of the minimum size viable for that purpose in the face of the huge number of Soviet strategic as well as sub-strategic nuclear weapons. I hope that makes the situation perfectly clear to the noble Lord, Lord Jenkins.
There is just one point I would pick up, if I may, before I conclude. The noble Lord, Lord Mayhew, mentioned the United States Poseidon submarine which is assigned to the Supreme Allied Commander in Europe. Here, again, these strategic nuclear systems are not the subject of the INF negotiations in Geneva, since they are fully covered in the strategic arms control negotiations in the START talks. Having said that, I must nonetheless reflect that the Question which the noble Lord asks this evening, although it is confined to the area of intermediate-range nuclear forces, cannot really allow us to concentrate only upon that field, if greater security is to be achieved for the whole world.
For that reason it is important that at the START talks in Geneva the United States proposals would cut deep into the number of deployed strategic ballistic missiles and their warheads, and that at the MBFR talks in July the West put forward proposals to reduce conventional forces on the central front by making a commitment to this by all participants in the Vienna negotiations—a factor which the Eastern bloc had always held to be an obstacle to agreement on conventional forces.
We believe we must continue to persevere, for only if both East and West agree that it is in their own

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interests to control the arms they hold will the security of the world be increased. It is a snare and a delusion to believe that through a unilateral rejection of responsibility there is some short cut to peace. We must remain firm in our resolve, but ready always to negotiate for agreement on balanced and verifiable reductions in arms. Only in that way can greater security be achieved.
Lord Denham: My Lords, as it all too often falls to my lot to inflict on your Lordships late hours and a heavy burden of work, I should like from this side of the House to express to all other parts of the House a wish for a Happy Christmas and a restful and peaceful recess. I believe I speak for the whole House when I express the same wish to all those in this part of the Palace of Westminster who work to look after us all so well.
Lord Ponsonby of Shulbrede: My Lords, in supporting the noble Lord the Chief Whip, I take this opportunity, I hope not prematurely, of congratulating him on achieving a more even flow of business at the start of this Session. As I said, I hope those are not premature remarks and that we will, in fact, be spared having an intolerable programme of business next summer.
I wholeheartedly join with him in his remarks to the staff, and all those who work at this end of the Palace, for the long hours and devoted service that they have given to the House. I join with the noble Lord in wishing a happy Christmas and a prosperous New Year to all.
Lord Gladwyn: My Lords, I associate these Benches with everything that has been said.
Lord Kennet: My Lords, and I from these Benches.
Lord Denham: My Lords, I am most grateful to the noble Lords. I beg to move that the House do now adjourn.
The House adjourned for the Christmas Recess at twenty-four minutes before six o'clock until Monday, 17th January next.

INFANT MORTALITY: NUMBERS AND RATES FOR LEGITIMATE BRTHS BY SOCIAL CLASS FOR AGGREGIATED METROPOLITAN CONTIES*

Social Class All legitimate*

I

II

III

IV

V

Year

Number

Rate

Number

Rate

Number

Rate

Number

Rate

Number

Rate

Number

Rate

1975–76

3,826

15·1

145

10·0

414

11·0

1,911

14·1

776

17·6

425

24·7

1977–78

3,294

13·5

156

10·1

388

10·6

1,608

12·7

715

16·3

299

18·6

1979

1,704

13·0

70

9·2

205

10·3

865

12·8

344

13·7

185

20·0

Decrease in rate

—

2·1

—

0·8

—

0·7

—

1·3

—

3·9

—

4·7

1979 rate as per cent. 1975–76 rate

—

86

—

92

—

94

—

91

—

78

—

81

*Includes "others" not in I-V.

Rate: per 1,000 live births.

†Greater Manchester

Merseyside

South Yorkshire

Tyne and Wear

West Midlands

West Yorkshire.

1980 figures are not included in the tables because of changes in social class classification.