Lords Sitting of 30 March 1982

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Rochester.
The Marquess of Exeter—Sat first in Parliament after the death of his brother.

Small Businesses: Assistance
Lord Northfield: 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 how much per annum the following district councils, all of which have high unemployment levels, would be able to spend on aid to small businesses under the Government proposals to restrict such expenditure to the product of a halfpenny rate: Alnwick; Derwentside; North Devon; and Blaenau, Gwent.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellwin): My Lords, the "inclusive" totals for the authorities concerned would amount to: Alnwick, £24,738; Derwentside, £62,806; North Devon, £72,001; and Blaenau, Gwent, £76,276.
Lord Northfield: My Lords, since unemployment in these four districts is running at something like 17 per cent., 25 per cent., no less than 28 per cent., and 21 per cent., does not the noble Lord think that it was something of a mistake for the Government to recommend that expenditure on assistance to small firms by these districts, in the way of training and other initiatives that they are so successfully pioneering, should be reduced to these relatively trivial sums compared with what they are able to do now?
Lord Bellwin: My Lords, I am sure the noble Lord is aware that at the present time the sums of money available to district authorities of this kind is in total over £90 million, whereas their take-up at the present time is some £12 million. But, even so, I think the basic answer is that that is why we have put out a consultation paper. When we receive the results of the consultations we shall take very careful note of them, as well as of the statements which I know the noble Lord himself has made and the statements that have been made in debates in your Lordships' House in the last week or two. We are indeed considering the point, which I acknowledge is one of much importance.
Lord Shinwell: My Lords, is the noble Lord aware that, in addition to the councils mentioned in the Question, I have received representations from Cleveland and other northern areas which say that the halfpenny is totally inadequate if they are to
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assist in particular small businesses? I understand the Government are anxious to help small businesses. Would the noble Lord not agree that the halfpenny rate is inadequate for that purpose: Would the Government reconsider the matter, in order to help the local councils and also the small businesses?
Lord Bellwin: My Lords, I take the point the noble Lord, Lord Shinwell, makes, but I have to say again that hitherto the take-up has not been anything like the amount available. Nevertheless, the basic point is valid and we recognise it, and that is why we have the consultation paper and why we are listening to what noble Lords have to say on this matter. Helping small businesses is indeed a key priority for the Government. I would also point to the some 60 measures this Government have taken to do that, which we would claim is more than any Government have ever done before in this country.
Lord Cledwyn of Penrhos: My Lords, is the noble Lord aware that we welcome the 60 measures, but is he certain that they are taking effect in the areas where the need is greatest? The need is greatest in areas like Blaenau, Gwent, and the other areas mentioned by my noble friend, and the areas of North Wales where I live, where unemployment is unacceptably high and where Government help does not seem to be having any effect on the problem of rising unemployment. The noble Lord said that consultations are going on. What does he mean by that? This is an answer very often given by Governments to get themselves off the hook. How long are these consultations going to take? The longer they take the longer there will be unemployment, and this is the problem we want the Government to solve quickly.
Lord Bellwyn: My Lords, I am sure the noble Lord has read carefully the consultation paper to which I referred, which, as he will know, is due to be returned by 30th April. Until that is returned clearly one cannot come to conclusions. As was said as recently as last night in your Lordships' House, this matter is of concern and is being treated as such.
Lord Glenamara: My Lords, is the noble Lord aware that Derwentside District Council, which is one of those mentioned in the Question, produced a report recently which showed that unless 7,000 jobs are produced immediately unemployment in that area will rise to 40 per cent. before the end of this year? Is he aware that the ratio of unemployment to vacancies in the Derwentside District is 88:1, and does not this kind of situation call for very much more urgency than the right honourable gentleman has displayed today?
Lord Bellwin: My Lords, it is not "the right honourable gentleman", as I am sure the noble Lord would agree. The fact is that what we are proposing here is another form of allowance to enable local authorities to do things beyond those they are able to do at the present time, consistent with certain other constraints upon them. It is really the question of whether or not this is adequate which is a matter of debate at the moment. In many of the areas of

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the country this halfpenny rate is additional to the 2p rate which may be spent under Section 137 of the 1972 Act; in those cases it is additional. The problem which the noble Lord, Lord Northfield, is bringing up arises because it is in areas like those he mentions, as well as others, that the proposal in the consultation paper is that there should be a reduction from the 2p to the halfpenny. That is what we are looking at at the present time. But can I say before I sit down that it is not Governments that create jobs. Governments create climates; they do not make jobs.
Lord Nugent of Guildford: My Lords, would my noble friend say what effect each extra penny on the rates has on throwing people out of jobs because of the excessive burden that businesses have to bear?
Lord Bellwin: My Lords, clearly I cannot state specifically what that effect is because of the wide difference in different authorities, but that there is an effect upon employment caused by excessively high rates is now beyond any question.
Lord Kaldor: My Lords, would the noble Lord not agree that, if it were not for ideological inhibitions, central Government might be a much more efficient agent for helping areas like Derwentside, rather than leaving it, indirectly, for local government to act: There are areas where these problems are so big—
Several noble Lords: Question!
Lord Bellwin: My Lords, the point is that at present local government has powers to act. It is intended in the consultation paper that there shall be a certain reduction of those powers. But at present the authorities do have powers to act beyond what is in the consultation paper.
Baroness David: My Lords, is the Minister aware that the training centre which the Fenland District Council is running with Manpower Services Commission money has to count against the 2p rate given under the 1972 Act? Would that sort of consideration be taken into account when the Government are finally deciding what they should do as a result of consultations?
Lord Bellwin: My Lords, the noble Baroness makes a very fair point. I would only want to know in the case which she has mentioned whether the authority was, in fact, at present taking up the whole of its allocation. Clearly I do not know and possibly at this moment the noble Baroness does not know. However, the noble Baroness's point about the extent to which training or, for that matter, anything else, is included or excluded, is of importance and I am hoping that that will be something that will be shown up when we get the returns on the consultation paper.

Cystic Fibrosis: Current Research
2.45 p.m.
Lord Molloy: 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 what research is being carried out into cystic fibrosis and at what cost.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Elton): My Lords, the primary responsibility for publicly-funded biomedical research lies with the Medical Research Council. The council receives a grant in aid from the Department of Education and Science; this has to cover the whole of its field of interest. In 1980–81, it was £71·8 million. Of this, about £100,000 was spent on research related to cystic fibrosis. Other work supported by the council may also prove significantly beneficial in this field. Research into this terrible disease is, of course, also going on in various universities and medical schools, but I cannot say what the cost of this may be.
Lord Molloy: My Lords, is the noble Minister aware that the Cystic Fibrosis Research Trust has, through voluntary endeavour since 1964, garnered £2 million, which has made a massive contribution, as the Minister has said, towards trying to rid our nation of this horrid disease: Is the Minister aware that there seems to be a need for better co-operation between the research trust and the Medical Research Council, particularly in four specific fields: the isolation of the abnormal gene; the identification of the carriers of the gene; pre-natal diagnosis; and control of the illness and control of pseudonionas aeruginosa? Will the Minister make some endeavour—I am sure that he will—to try to bring the research units closer together so that this nation can be rid of the curse of an evil disease?
Lord Elton: My Lords, I am aware of the very valuable work which is done by the Cystic Fibrosis Research Trust and, indeed, of the way in which it has attracted non-public funds for that work, which is extremely welcome. As to the work to which the noble Lord has referred, I point out that the isolation of the gene is a very difficult matter which has not yet been achieved. I would say that the Medical Research Council is aware of the importance of this disease and that the Division of Inherited Metabolic Diseases at the clinical research centre of the MRC includes in its forward programme research into biochemical derangement in cystic fibrosis and also the detection of carriers of this disease. Perhaps I may detain the House a moment longer. It is, in fact, the result of the coincidence of a recessive gene in each parent of a union and when those recessive genes coincide there is a one in four chance that the child resulting will be suffering from cystic fibrosis. It is, of course, a matter for the parents to decide whether they take that chance or not.
Lord Winstanley: My Lords, is the Minister aware that at the moment there is a rather worrying general increase in the incidence of genetically transmitted diseases, of which cystic fibrosis is but one, and that that surely means that the Government should at the moment increase their investment in genetic counselling services rather than reduce it, as appears to be the case: Is the Minister further aware that young people contemplating marriage—and some young people do contemplate

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marriage nowadays—show a great willingness to take advantage of genetic counselling services where those are available, but unhappily in some areas they are not available at all?
Lord Elton: My Lords, of course genetic counselling, admirable as it may be, is a different question, and I cannot respond to the noble Lord's probings on that front without notice. As to the other question which the noble Lord asked, I should say that the Government do, through their departments of health, give guidance to the Medical Research Council as to the need for research and that the need for research into genetically determined illness is, in fact, one of the matters to which they have directed their attention and to which they are responding, as I have just said, by their work at the centre.
Lord Maybray-King: My Lords, in the field of spina bifida and cystic fibrosis—and all the diseases which afflict and handicap children—is not the remarkable feature of our country that so much voluntary work is being done by groups of people and that those groups of people are co-operating with the professions?
Lord Elton: My Lords, the voluntary spirit is one of the hallmarks of this nation, of which we are all proud and from which we all benefit. I should like to endorse what the noble Lord has said and what the noble Lord, Lord Molloy, has implied in this matter, that the voluntary agencies do great work in the medical field as well as in other fields.
Lord Wallace of Coslany: My Lords, is the noble Lord aware that I, too, applaud voluntary effort: However, on this subject of medical research, is it not about time that we—and I am not talking about Governments—the people, with the Government giving the lead, directed a great many more of our resources into research in the field of preventive medicine, rather than possibly spending hundreds and billions of pounds on methods to destroy life: Rather, should we not vote money to save life?
Lord Elton: My Lords, prevention, whether in medicine or in war, is always better than cure. It is my belief that this Government's policies are far more likely to prevent the disease of war in the world than the policies advocated by the noble Lord.
Lord Wells-Pestell: My Lords, is the noble Lord the Minister in a position to inform the House as to the number of deaths in young children resulting from this particular disease? Also, is he in a position to say what success the Medical Research Council is having in this particular field?
Lord Elton: My Lords, the incidence of the disease is about one in 1,600 children. An increasing proportion of those children now survive to adult life. I cannot tell the noble Lord how long into adult life they typically survive. As to the degree of success being achieved, I think that there are a number of areas which are encouraging. I believe that there is an ability to diagnose the disease early in the life of a child
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by means of a blood sample after six weeks. In fact, it is beginning to appear that we may be able to diagnose the disease in utero, which has very important implications for what the parents do about it. In addition, as I say, through the MRC, the Government will be funding research in the future.
Lord Molloy: My Lords, is the noble Lord aware that I am deeply grateful, as I am sure is the House, for the obvious research that he has carried out into my Question? Would he not further agree that, if the exchanges across the Floor of this House could be turned into reality, we should be taking a dramatic step forward in ridding our nation of cystic fibrosis in the manner in which all medical research has to go on, in both the curative and the preventive elements?
Lord Elton: My Lords, I am most grateful to the noble Lord for showing that we share the same interest in this matter.

Westminster Hospital Medical School: Cuts
2.54 p.m.
The Earl of Gosford: 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 how many patients (a) in the United Kingdom and (b) outside the United Kingdom, are affected by the £30,000 cut at the Department of Experimental Chemical Pathology at the Westminster Hospital Medical School; and how many centres (a) in the United Kingdom and (b) outside the United Kingdom, can provide a service which can separate and estimate all four forms of Vitamin B12.
Lord Elton: My Lords, the answer to the first part of the noble Earl's Question is none, at least for the present. An alternative source of finance has been secured until the end of the next financial year. In answer to the second part, I can say that I understand that the department is the only centre in the world at present able to separate and estimate the concentration of four forms of Vitamin B12 at present known. There are, however, three other centres in this country that could undertake this work, were it considered necessary so to do; namely, the clinical research centre at North-wick Park, St. Bartholomew's Hospital and the Royal Free Hospital.
The Earl of Gosford: My Lords, I thank the Minister for that reply. Is he aware that this particular unit has had 16 years' experience and that at this particular time the cuts envisaged would mean a 25 per cent. reduction in staff, which in this case would be two people: Is he further aware that the simultaneous separation of an estimation of the four individual parts of the Vitamin B12 compound is very vital for the treatment of anaemia and progressive blindness, let alone mental retardation, which in severe cases can lead to death?
Lord Elton: My Lords, I can answer for the Government but not for the department at the university. I cannot answer for the Westminster Hospital Medical School; I can only observe that they have given a higher priority to many other functions. I understand that this was a considered decision and that it saved them about £30,000 a year. It is not the only place where the work can be done. The money does not come directly from Government; it comes from the University Grants Committee, which sends it to the universities, which decide how to distribute it among their schools and then the departments.
Baroness Jeger: My Lords, are the Government giving any general consideration to the funding of research, which is of national and international importance, and which at present is having to be met out of the decreasing funds of individual hospitals?—because this is the root of the problem at Westminster.
Lord Elton: My Lords, the money which the Government propose to spend on the Medical Research Council next year is £107·4 million, which is an increase over the present year. The money is not diminishing.

Namibia: Settlement Negotiations
3.57 p.m.
Lord Brockway: 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 what progress has been made towards a settlement in Namibia.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Lord Trefgarne): My Lords, the Five remain in touch with all concerned about the replies to their revised proposals for constitutional principles for the Namibian Constituent Assembly. They hope soon to settle the questions which remain to be resolved in this phase of the negotiations.
Lord Brockway: My Lords, will the Minister agree that there has been a serious deterioration in the situation since we had our recent debate? First, last week did not the meeting of the senior officials involved declare that there had been "little progress"? Secondly, have not the front line states and SWAPO now rejected the proposal for double voting because of its complexity—seven columns, with the majority of the voters illiterate: Thirdly, what is the prospect of SWAPO referring the whole issue back to the Security Council because of this deadlock? Can the Minister particularly answer the question: What is the Government's view of SWAPO's proposal of direct negotiations with South Africa?
Lord Trefgarne: My Lords, if I may say so, that is a rather comprehensive supplementary question. However, I think that the situation is not necessarily as black as the noble Lord paints it. Certainly SWAPO and others have found some difficulties with proposals
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that were recently put forward in relation to the electoral system, and the Five are now concerned to clarify their position on their proposals to see whether there is any gloss which can be put on them to ease the difficulties which have been seen.
Lord Cledwyn of Penrhos: My Lords, would the noble Lord be good enough to clarify a little further what he has said, especially on the dual voting system, which, as my noble friend has said, is the obstacle? What is the view of Her Majesty's Government on the dual voting system as put forward? Is there any chance that this could be amended? If it is a major obstacle in the negotiations, would it not be desirable that there should be some concession on the voting system in order to achieve a settlement as quickly as possible?
Lord Trefgarne: My Lords, what has been proposed is a mixed system of proportional representation and single-member constituencies, which we think need not be unduly complicated and, indeed, could be put into effect without excessive expense or delay. We believe that it would be fair to all parties competing in the elections, and it is certainly not designed to favour one party or the other. We are now considering the difficulties which the parties have seen in these proposals, to see, as I said, what gloss can be put on them to ease the difficulties.
Lord Brockway: My Lords, could the Minister say what hope there now is of reaching the target of independence next year, not only because of the deadlock in the negotiations but because of the very complicated arrangements which will have to be made after an agreement is reached?
Lord Trefgarne: My Lords, we remain hopeful that the original timetable can be achieved. I would not regard the present situation as deadlocked, as the noble Lord describes it, and perhaps in due course there will be better things to report.

South Georgia (Falkland Islands Dependencies)
3.1 p.m.
The Secretary of State for Foreign and Commonwealth Affairs (Lord Carrington): My Lords, as my noble friend Lord Trefgarne informed the House on 23rd March, a group of Argentines, employed by a commercial contractor, Mr. Davidoff, an Argentine citizen, landed at Leith Harbour on South Georgia on 19th March from an Argentine naval transport vessel. Mr. Davidoff had been informed in advance of the need to seek the necessary permission from the British authorities at Grytviken to land and to carry out this salvage work. He conveyed to the British Embassy in Buenos Aires his intention to begin work in South Georgia but gave no indication that he would not follow the normal immigration procedures.
When the party arrived at Leith they did not seek the required documentation: and when requested by the base commander to proceed to Grytviken in order to do so, they failed to comply. Mr. Davidoff's commercial contract is straightforward. But it does

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not absolve him or his employees from complying with normal immigration procedures. Subsequently, the majority of the Argentinian party and the Argentinian ship departed: but about a dozen men remained on shore.
We therefore made it clear to the Argentine Government that we regarded them as being present illegally on British territory, and sought their co-operation in arranging for their departure, pointing out, however, that their position could be regularised if they were to seek the necessary authorisation. Meanwhile, HMS "Endurance" was ordered to proceed to the area to be available to assist as necessary. She has been standing by since 24th March.
On 25th March an Argentine vessel delivered further equipment to the group ashore. The Argentine Foreign Minister has said that the Argentine party in South Georgia will be given the full protection of the Argentine Government. Argentine warships are in the area.
The situation which has thus arisen, while not of our seeking, is potentially dangerous. We have no doubts about British sovereignty over this Falkland Islands dependency as over the Falklands themselves.
We remain of the view that the unauthorised presence of Argentine citizens in British territory is not acceptable. We have no wish to stand in the way of a normal commercial salvage contract, but the position of those carrying it out must be properly authorised. Further escalation of this dispute is in no one's interest. In these circumstances it is clearly right to pursue a diplomatic solution of this problem. This we are doing. I hope that the Argentine Government will take the same view. Meanwhile, the question of security in the Falklands area is being reviewed, although the House will understand that I prefer to say nothing in public about our precautionary measures. I can, however, inform the House that HMS "Endurance" will remain on station as long as is necessary.
Lord Shackleton: My Lords, on my temporary return to the Front Bench I should like to thank the noble Lord for that measured and sensible Statement. I say "sensible" because if there is one thing that none of us would wish to do it is to exacerbate an already potentially dangerous situation. Clearly the noble Lord appreciates the seriousness in coming back from perhaps a fairly difficult time in Brussels and bound, I hope, for an easier time in Israel—although I rather doubt whether it will be easier.
Nonetheless, the situation is serious enough, and there are one or two questions I should like to ask the noble Lord, while again echoing the importance of us all preserving a due sense of caution because now, of all times, is the time for the exercise of the maximum of diplomatic skills. The fact remains that the Falklands and South Georgia have been British for a very long period. I doubt whether until now there have been anything other than the occasional visiting ship from the Argentine on South Georgia; this beautiful and potentially island is important because it is the potential centre of krill fishing.
Does the noble Lord agree that the preservation of
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British interests in this part of the world—I appreciate his firm reiteration of our stand—concerns not only the protection of the wholly British people in the Falklands but could affect the peace of the whole of that area of the Antarctic? The Antarctic Treaty comes up for revision in 1991. As I have said before, the great strength of that has been that the Cold War has never come to the Antarctic, and it is important for conservation, and all sorts of measures, that we should retain our position in that part of the world.
It is gratifying that HMS "Endurance" is still there. For those who doubt the effectiveness of HMS "Endurance", one is bound to say that it is the presence of the White Ensign and the potential backing of our sovereignty that is important. I am bound to say to the noble Lord that the decision announced some while ago to cancel HMS "Endurance" must have encouraged the Argentines in their belief that the British were on the way out. Indeed, I was rung by a friend of mine in the Argentine Embassy to ask me to confirm that. I of course denied it vigorously. Allowing the settlement of armed men—not to mention pregnant mothers in Southern Thule, also in the Sandwich Islands, so that there should be an Argentine Antarctic citizen born there—and the absence of any strong reaction to that will have encouraged them.
I shall not press the noble Lord—and I think we ought not to—on the subject of the precautionary measures that the Government are taking. Nothing we say here of that kind, no bellicose statement, will help a situation which is difficult enough as it is now. But I should like to ask the noble Lord whether the British Embassy were actually informed that Mr. Davidoff's party was going, whether the governor was informed, because it seems to me that, if he was not, there has been some failing. Perhaps the noble Lord could explain that. I am bound to make the remark that once again we see the whole argument between conventional weapons and nuclear weapons, and whether in a situation like this Trident could be of any help as opposed to more conventional forces.
Lord Gladwyn: My Lords, I too should like to thank the Foreign Secretary for making this Statement, more especially since I understand he has come rushing back from Brussels especially to inform the House of what is happening. I have only two short points to make. We must all hope of course that diplomacy will continue and will succeed in solving this dispute, but of course in the event of diplomacy failing, I imagine that we must all assume also that the Government have contingency plans for, if necessary, settling it by other means.
The second point I should like to make—here I speak with the greatest diffidence—is have we even in the course of this long wrangle considered the possibility of referring the whole matter to the International Court and abiding by the court's decision? I understand that sovereignty disputes are essentially legal matters. In the past many disputes on sovereignty, on border disputes, and so on, have been settled by legal means. If our case is as convincing as we believe it to be, I should have thought that we should lose very little and could gain a great deal by submitting it to the court. But perhaps it has been considered in the past and turned down for reasons of which I am not aware?
Lord Carrington: My Lords, I am sure that both noble Lords who have responded to the Statement are right in saying that diplomacy is the way to settle the problem. After all, that is why we have the Foreigh Office and diplomats, so we must solve it in that way. With regard to the specific questions of the noble Lord, Lord Shackleton, I agree with him that the preservation of British interests is in the interest of peace in the area and, as he knows, the Government support the Antarctic Treaty and I believe that has been useful in keeping the cold war out of that area.
HMS "Endurance", as the noble Lord will have noticed from the Statement, will stay on station for as long as necessary. The review, which I mentioned is taking place on the security of the Falklands, will obviously include the long-term future of "Endurance". The British Embassy did not know the exact date on which Mr. Davidoff was going; they only knew he was going and had no reason to suppose he would not let them know in the proper way, and that is how this particular incident arose. I do not think the noble Lord would expect me on a Statement of this kind to enter into a debate on the merits of conventional or nuclear weapons.
As for the question asked by the noble Lord, Lord Gladwyn, it does of course take two to refer a matter to the International Court of Justice; I do not think they will accept a case unless both participants are prepared to put it to them. I have not looked it up, but my recollection is that we sought to do that quite a long time ago over one of the dependencies—not, I think, the Falkland Islands but one of the dependencies—and the Argentine Government refused. However, that will be one of the ideas which we shall be examining.
Lord Morris: My Lords, while I accept that matching might with might at this particular stage would probably be unhelpful, may I ask whether Her Majesty's Government would consider seriously in the near future at least matching the considerable economic interest which has been shown in the area by virtually every developed country other than the United Kingdom?
Lord Carrington: I take it that my noble friend is talking about the economic development of the Falkland Islands and the dependencies, my Lords. That is obviously something which has been very much in the minds of successive Governments. The noble Lord opposite was concerned with that aspect in the report he made about the Falkland Islands. It is something we are always examining, but my noble friend will recollect that at the moment public money is short.
Lord Murton of Lindisfarne: My Lords, is there any truth that there is still an Argentine presence in Southern Thule?
Lord Carrington: Yes, my Lords; the position in Southern Thule is the same as it has been for a number of years.
Lord Molloy: My Lords, would the noble Lord agree that it is also fundamental for the Argentinians
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to recognise that the British Parliament is overwhelmingly in support of the endeavours of the British Foreigh Secretary and that perhaps there should be utterances in his support not only from our Parliament but from other free Parliaments who have interests in the area?
Lord Carrington: My Lords, I am grateful for those comments and I have no doubt that the Argentine Government, as a result of these exchanges and no doubt what will take place in another place, will be fully aware of that.
The Earl of Glasgow: My Lords, while welcoming the retention of HMS "Endurance" for as long as necessary, may I ask my noble friend whether the situation in the South Atlantic now might produce a slight reprieve for the surface fleet?
Lord Carrington: I did not know the surface fleet had been condemned, my Lords.
Lord Buxton of Alsa: My Lords, before putting my question, I would mention that I have been in the Argentine, the Falkland Islands and South Georgia within the last two weeks. That being so, I would say that in my view the reaction of the Government has been absolutely right and correct in the circumstances, taking into account that our two countries, our two Governments, are in continuous, respectable and honourable diplomatic relations, and the interruption to those by the reckless conduct of naval elements, particularly in South Georgia, is much to be deplored.
Since Argentina is very proud and jealous of her reputation, may I ask my noble friend to appeal to the statesmen in the Argentine régime to exert their influence and persuade the armed forces that untold damage will be done to Argentina's reputation in the long run by this reckless reaction in the middle of honourable negotiations? May I further ask my noble friend to convey to the statesmen in Argentina that the conduct of this enterprise—having been there, I regret to say that it appears to have been devious, carefully reccied, carefully planned and very carefully timed; there is ample and convincing evidence of that—is in danger of destroying at a stroke the plausibility and influence of those of us, both here and in the Falkland Islands, who have been striving to support the intergovernment negotiations and the search for an honourable settlement? Those negotiations are now in mid-stream. Does my noble friend agree—
Noble Lords: Too long!
Lord Buxton of Alsa: I know personally some of the Argentinians, my Lords, so may I appeal through my noble friend to them to take due regard of Argentina's future prestige and reputation in the world?
Lord Carrington: My Lords, I am grateful to my noble friend for making those points because he has deep knowledge of the area—I was going to say unrivalled knowledge, but the noble Lord opposite has knowledge of the area; they both have very specialised knowledge of that part of the world. I am therefore grateful to my noble friend for the help he has

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given in the matter. I certainly shall take note of what he said and, to make just one comment on it, it seems to me that what has happened in the last week or so has not improved the climate of relations for a settlement of the problem.
Lord Shackleton: My Lords, while we do not want to prolong for too long questions on the Statement—and we are grateful for the firm statement made by the noble Lord—I would ask him to check on one point. It is my recollection that an attempt was made on more than one occasion to refer the question of the Falkland Islands to the International Court and that Argentina always refused to participate. It is important that that should be confirmed because this is a matter of international law and I have no doubt that the advice would have been that the British claims were valid.
Lord Carrington: My Lords, my recollection is the same as that of the noble Lord. I did not know about more than one case, but I will certainly look it up.

Salmon Fisheries (Protection) (Scotland) Bill [H.L.]
Bill read a third time, and passed, and sent to the Commons.

Administration of Justice Bill [H.L.]
3.18 p.m.
The Lord Chancellor (Lord Hailsham of Saint Marylebone): 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.—(The Lord Chancellor.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Clauses 1 and 2 agreed to.
Clause 3 [Amendment of Fatal Accidents Act 1976]:
Lord Mishcon Lord Mishcon moved Amendment No. 1:
Page 3, line 20, at end insert—
("(g) a reputed spouse of the deceased residing with him at the date of his death.").
The noble Lord said: In this Bill we are reminded of the list of dependants under the Fatal Accidents Act; namely, those who, from their dependency upon someone now deceased as a result of a fatal accident, can claim against the person responsible for the accident in negligence for the loss of that dependency. The list has been extended by the Bill, but it does not include a common law spouse. I think that all of us will appreciate that someone in that position may well indeed have been a dependant and had had removed from her a whole prop in her life (if I may use the phrase) as a result of a fatal accident.
When I ventured to raise this matter on Second Reading, the noble and learned Lord the Lord Chancellor replied with his usual courtesy and breadth of mind. He said that one of the problems—and he did not limit himself to this problem—was that a common law spouse was someone who was unknown by that description in our statutory law. Knowing that the noble and learned Lord is never wrong, I therefore decided that I would waste my time by doing some research. To my astonishment I found that on this occasion my time was not in fact wasted, because indeed the phrase occurs in Section 3(1) of the Pneumoconiosis etc. (Workers' Compensation) Act 1979 in relation to one of the dependants under that Act.
It might very well be that there can be found for a common law spouse a description more suitable than the one which my noble friend and I have inserted in the amendment, but I believe that at the Committee stage of a Bill we are really going for the principle of the matter, not the detail. I say that because on Second Reading my noble friend Lord Elystan-Morgan was most helpful in suggesting that we might borrow from another Act, the Inheritance (Provision for Family and Dependants) Act 1975, in which the definition of a dependant, given right at the end of a long list, is,
"any person…who immediately before the death of the deceased was being maintained, either wholly or partly, by the deceased".
It would be a very good thing if we could have precisely the same list of dependants in two Acts which have something to do with one another, since in both cases one is dealing with the result of a death and looking at the question of dependency. But there is one difference which I must in all honesty point out. The Inheritance (Provision for Family and Dependants) Act 1975 excludes a spouse who has remarried, whereas this Bill includes a spouse who has remarried. It might be thought objectionable that there is the muddle of thinking that the same description of dependants is contained in two Acts, only to find that there is in fact some difference.
So it was for that reason that I pinned my faith on the words of the amendment and straightforwardly called the person whom we were thinking of,
"a reputed spouse of the deceased residing with him at the date of his death".
But I repeat that if the wording is objectionable, I would still ask that at this Committee stage the principle be accepted.
I come now to my final observation. Your Lordships' House is proud of the fact that we move with the times. We are often accused of not doing so, especially when your Lordships have before you—you have had a spate of them recently—Bills on sex matters, including pornography. I refuse to believe that your Lordships' House does not move with the times. It is a well-known fact that, for good or ill, the numbers of common law spouses have increased over the past few years. I do not think that we ought to blind ourselves to the fact that this is very often, though not solely, the case among the poorer sections of our community. For one reason or another they find that it is not suitable to obtain a divorce, or it might very well be, especially now that legal aid is not available, that they cannot afford to obtain a divorce.
So I hope that, consonant with the times and with what is happening in our society, and looking at the misery of someone who has acted as a wife for perhaps very many years and who, as I have said, suddenly finds her prop removed, the Committee will think it appropriate to add the proposed description of person to the list of dependants contained in the Bill. I beg to move.
Lord Simon of Glaisdale: I should like to raise a purely terminological point. The noble Lord, Lord Mishcon, might have found a precedent, but the use of the term "common law wife" in the sense in which it is used in the amendment, can only cause confusion because one can still be married validly, admittedly now under unusual circumstances, at common law—for example, I think probably on a merchant ship that is not in territorial waters; and there are various circumstances. I am very doubtful whether the terminology used by the noble Lord in the amendment achieves the purpose, but at any rate it seems to be advantageous, and should always be advantageous, to avoid the term "common law wife".
Lord Rawlinson of Ewell: I must confess that whenever I am encouraged to move with the times, as I have been by the noble Lord, Lord Mishcon, I immediately get a kind of frisson. We ought to look very carefully at what we are being asked to do when, in your Lordships' Chamber, we are asked to move with the times. I cannot see the purpose of the phrase:
"a reputed spouse of the deceased residing with him at the date of his death".
What is the real reason for it? Is the noble Lord right when, with great persuasiveness, he says that it is the people of the poorer sections of society who might be placed in these circumstances? I should have thought that if we are moving with the times, it would be in the richest circles that one would find,
"a reputed spouse of the deceased residing with him at the date of his death".
Therefore I wonder whether we really should include this phrase. Why should we include it? What is the point of it? Why should we have to include it? There might be very hard circumstances in certain cases, but I wonder whether we should introduce this particular provision in the Bill.
3.29 p.m.
The Lord Chancellor: In view of the fact that I am going to make a number of rather discouraging remarks about the proposed amendment, I should like to point out that on my brief there is marked the word "consider". If anyone does not know what I mean, I am sure that the noble and learned Lord, Lord Elwyn-Jones (whom I am glad to see opposite me) will explain. Therefore I am not being wholly hostile to the amendment, though I am not very attracted either to the terminology of the amendment or necessarily to the principle behind it.
As I tried to explain on Second Reading, this Bill secured a place in the Government programme by the skin of its teeth, and only on condition that it was a good-housekeeping measure which would not give rise to a great deal of confusion or controversy. That
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being so, I think this amendment causes problems probably of a greater kind than the noble Lord has really envisaged. Perhaps I may point out that I did not say that "reputed spouse residing with him" was not to be found in our statute law. It was the phrase "common law wife" at which I slightly bridled, in spite of the learning contributed by my noble and learned friend on the Cross-Benches. So far as I know, it is not a conception with which the law is fully familiar, at any rate in the sense in which it is used in the popular press.
The point I stressed at Second Reading was that there really is a greater difficulty in defining this relationship than the noble Lord, Lord Mishcon, has perhaps recognised, because the intimacy and length of the relationship can be almost infinitely truncated or extended. Now it is of course perfectly true that in the pneumoconiosis scheme (which is rather in a different field of territory and which can be administered administratively rather than by litigation between arm's length litigants, usually consisting of a dependant and an insurance company behind a tortfeasor) the particular phrase which he has plucked out occurs. It is also true that in the family inheritance Act the phrase which the noble Lord, Lord Mishcon, attributed to his noble friend Lord Elystan-Morgan also occurs, the two principles involved being entirely different from one another; one depending on reputation and the other upon actual dependency and maintenance. The principles are fundamentally different.
I must remind the Committee that the Pearson Royal Commission considered the possibility of including (I use the words in quotes) "common law wives" in the class of dependants entitled to claim under the Fatal Accidents Act but was reluctant to propose a change in the law of tort which would conflict with the social security position, since it was fundamental to the approach adopted by the Pearson Commission that the two systems should ultimately be co-ordinated. Of course, the Government are constantly and rather movingly being pressed to adopt the Pearson Commission's report. This amendment would really be to put in the way of such adoption an obstacle even greater than the obstacles which already exist and which have so far prevented us from doing so. I must add that in their report of 1973 (which preceded, I think, the Pearson Report) the Law Commission came to exactly the same conclusion on the slightly different grounds of difficulties of definition and social policy—and, of course, social policy was at the bottom of what my noble and learned friend Lord Rawlinson has just referred to—and added that there might be a case for examining the legal position of a common law wife in all its aspects.
I am not sure that I agree with the noble Lord, Lord Mishcon, about moving with the times. I think I am on the side of my noble and learned friend about that. I think one should consider whether things are right in principle without necessarily deciding whether they correspond with the moving tides of popular opinion in one direction or another. I must say that I find it difficult to see how mere reputation and residence should give rise to a claim under the Fatal Accidents Act; I am not sure, either, that I agree with the noble Lord, Lord Mishcon, in saying that this is a feature confined to the poorer sections of the

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community. I should have thought it was a characteristic of all classes that occasionally they have people living with them who have a certain reputation of matrimonial status which they have not in fact formally achieved.
But suppose you get a short-lived relationship which happens at the moment of death to coincide with residence, without matrimonial status behind it. I think that under this definition such a woman would probably qualify. Suppose you get a woman who lives with a man for 40 years but retains her name of Miss Brown when his name is Mr. Smith. She would get nothing under this Bill. In other words, you have created an anomaly instead of preventing one. Suppose you get two unmarried persons, both with the name of Smith, sometimes with the lady having changed her name by deed poll, though everyone knows that they are not married and therefore her reputation is not that of a wife, but for reasons of social convenience and tact people do not often refer to the fact. Then, again, she would get nothing. But if in fact she had the reputation of being a wife, then she would be entitled to claim. One really does not want, I think, to add to the cost of litigation, and I can see a very fertile subject of dispute in this proposed provision.
There would, I think, be difficulties in introducing reputed spouses into the Fatal Accidents Act which do not exist in the family inheritance Act, which adopts a different formula from that chosen by the noble Lord, Lord Mishcon, or the Pneumoconiosis Act, which is a very narrow scheme limited to a particular disease and which very largely can be administered not by litigation but by administrative process.
This brings me back to the question (because I think it is a real question, and a real question which we must face) whether matrimony, which is a recognisable legal status, should not be the test of making the claim. Marriage is, after all, a contract leading to a legal status which people understand, and the question is whether something outside it which involves no permanence—and, I must add, in other fields of the law, I think, no obligation to maintain during life—should be the test whereby after death the claim should be made against a third party even though he be a tortfeasor. This, to my mind, really does call in question whether it is right that such a claim should exist outside the confines of marriage or the family ties which are already recognised as carrying with them an obligation to maintain.
Having said that, I recognise that the status of (I have sometimes heard them called "cohabitees", though why they should not be called "cohabitors" I have never quite understood; or common law wives, or whatever you choose to name them) does involve a certain degree of anomaly. I therefore recognise—and now, at last, I come back to my word "consider"—that there is a case to consider and that there may be some moral claim to compensation in certain circumstances. For instance, it must be anomalous that the illegitimate child of a particular union has a claim under the Fatal Accidents Act but the mother of the child has no claim under the Fatal Accidents Act. So, without any kind of commitment, and with a good deal of discouragement rather than encouragement, if the noble Lord will forgive me, I will look further into the
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matter, and that, I think, is the utmost I can do at the present stage.
Lord Renton: There is a further anomaly which may or may not have occurred to my noble and learned friend the Lord Chancellor; namely, that although Clause 3 of this Bill does not apply to Scotland, people who have been married in Scotland by cohabitation and repute, and who therefore, under Scottish law, are married, may come to England, live in England and find themselves in some doubt under this clause. To that extent I think that there may well be another anomaly which deserves the further consideration of my noble and learned friend.
3.40 p.m.
Lord Elwyn-Jones: I think the Committee will be grateful to the noble and learned Lord the Lord Chancellor for his open mind in approaching this difficult problem. We are concerned here with a right of action for a wrongful act which has caused death. The law tries in that situation as best it can to compensate the victims of such wrongful acts causing death. There is no doubt that in this country today there are hundreds and thousands of women living in the relationship of reputed spouses who have lived with a man and provided for him. Those of us who have had "surgeries" in the days when we were in another place will have come across many sad cases of poor old things who have looked after the man they were living with—and to speak of it as a lover and lover relationship was grotesque in many situations—who indeed devoted their lives to looking after him, and then there was the sudden catastrophe of the person upon whom they were dependent being killed by the wrongful act of someone else.
In that situation, I should have thought that a sense of responsibility, to say nothing of compassion, ought to move in favour of making provision, if we can, for the victim, as I might call her, in that situation. It is not easy, but it is not beyond the competence of a court to consider the weight of evidence of the extent of the relationship between the man and the woman in the case, the extent of the dependency—there would be neighbours, members of the family. The law considers far more complex and difficult problems than that in deciding whether, as a matter of fact, the claimant was a reputed spouse of the deceased residing with him at the time of his death.
Accordingly, I hope that the noble and learned Lord will not be discouraged by the fear of the noble and learned Lord, Lord Rawlinson, that we are moving with the times. It is not necessarily a bad thing to move with the times. Indeed, the great quality of the reform of the law in my time has been its willingness to live with the times and make it more acceptable and reputable as the factor determining the lives and relationships between our people in our community. It is significant that in Clause 3(5) of the Bill provision is made for the illegitimate child; so that we have already passed beyond the realm of sheer moral judgment in considering where social responsibility should rest and should be determined. Therefore, I hope that further thought to this matter from the noble and learned Lord, who is very sympathetic to these human situations, will result in his coming down,

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perhaps in different wording from that which we have in mind, in favour of the amendment in the fullness of time.
Lord Edmund-Davies: I am in considerable sympathy with the sponsors of this amendment because one finds it not difficult to understand the sort of domestic situation they have it in mind to meet, where people who have been treated as the spouse suffer from a sudden calamity. But the drafting of the amendment is something which calls for the greatest care, otherwise, as the noble and learned Lord the Lord Chancellor has pointed cut, the elasticity of the wording will let in all kinds of situations to which it would be thoroughly undesirable to accord legal recognition. With the utmost diffidence, I apprehend that the sort of situation which the movers of the amendment have in mind is one which is better covered by Clause 3(3)(c):
"any person who was treated by the deceased as his parent"
and maybe a situation where a man and woman have been living together in circumstances, it may be, which prevent their marriage although they desire it, and the man has unquestionably treated the woman in every way as though she were his wife.
In those circumstances, it matters not how long they have lived together or how faithfully he has treated her as a wife Nevertheless, everyone knows that they are not husband and wife and she will get no relief at all. In those circumstances, it may be that when one gets to a later stage of amendment some such language as that employed in Clause 3(3)(c) will meet the situation where everybody knows the couple are not a married couple but nevertheless the treatment of the woman has been that of a spouse. With the utmost diffidence, I make that suggestion.
Baroness Wootton of Abinger: I should like to point out another anomaly which arises. In present circumstances this affects the poorest people of all, those living on supplementary benefit. If a man and woman are living in the same home and officers of the relevant department are convinced that they live as man and wife then the law operates to the disadvantage of the woman. She is deprived of her rights. She may be drawing supplementary benefit in her own right. She is deprived of that right and becomes a dependant of the man. In that case the law giving her a reputed marriage works against her, but in this case it is proposed that it should work to her advantage. It seems anomalous that we should have the two different attitudes. It makes one feel more sympathy with the new arrangement proposed in the amendment. It would take care of the cases where the woman suffered from, as it were, being left out.
Lord Kaldor: I should like to apologise for intervening in a subject outside my field. I wish to make some comment on the discussion over the term "moving with the times". The legislation of a country at any one time necessarily reflects in all its various different aspects the prevailing mores and habits of the society to which the legislation refers. In that sense, it is necessary that Parliament should move with the times and does move with the times. Some 200 years
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ago the death penalty was imposed for dozens of different offences. This penalty would now be regarded by society as quite intolerable and, because society would regard it as intolerable, Parliament abolished the death penalty for most of these offences long before it abolished it altogether. I can give many instances in which the law is changed precisely because the moral judgment of society and the habits of society are changing.
Cohabitation which is not sanctified by marriage is looked upon very differently in the last quarter of the 20th century from what it was a hundred years ago in Victorian times. This discussion, I suggest, would not have arisen if this type of legislation had been brought forward a hundred years or more ago.
3.50 p.m.
Lord Boyd-Carpenter: My noble and learned friend has said that he would consider this matter, and therefore I do not want to prolong the debate. I should like to add one word from this side of the Committee in favour not of the phraseology which the noble Lord, Lord Mishcon, raised, but of the principle embodied in this amendment. Those of us who, like my noble and learned friend the Lord Chancellor, have sat in another place and have had to perform the duties of a constituency Member of Parliament must have come across in the course of our duties in our constituencies a considerable number of cases of people living very happily together in a settled ménage who reference to the electoral register indicated were not, in law, man and wife. If in these circumstances the man is killed in an accident, the lady with whom he has been living for some time suffers in material terms just as much as if she were his lawful wife.
I appreciate well the difficulty of the precise point at which the line should be drawn. I agree wholly with my noble and learned friend on the subject of the sanctity of marriage. However, in many of these cases there is—even for the strictest moralist—no criticism that can be made of the couple. Some of the cases that I recall were cases in which the man had found it impossible for a variety of reasons to obtain a divorce and had set up a home with another lady, which was a throughly settled establishment, his marriage having broken down.
I very much agree with what the noble and learned Lord, Lord Elwyn-Jones, has said, that whatever phraseology we use, it is not beyond the competence of our courts of law to determine whether this is a case of the kind that I think the Committee as a whole wants to see covered, that of a settled establishment—albeit not one blessed by holy matrimony—or a purely temporary arrangement.
Therefore, knowing as I do my noble and learned friend the Lord Chancellor's enormous attainments and, if he will allow me to say, his fundamental goodwill for people who suffer, I have great confidence that he will find a solution to this and come back at another stage.
Baroness Airey of Abingdon: May I, following this speech by my noble friend Lord Boyd-Carpenter, mention that I recently had a letter which is very much the same as he has just mentioned. It is from

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a lady who was living with someone who was killed by the IRA. She was in fact his common law wife and had been so for a substantial amount of time. I am sorry that I have not the facts at my fingertips because I have sent them to her representative in another place. But this seems to me enormously relevant to what the noble Lord has just said. She had lived with him for a very considerable time and she is suffering very considerably by his death at the hands of the IRA.
Lord Elystan-Morgan: May I, as one of the persons who raised this matter at Second Reading, say how deeply grateful I am to the noble and learned Lord the Lord Chancellor for the care and the humanity with which he has, in accordance with the undertaking given at Second Reading, reflected upon this matter. The noble and learned Lord, Lord Rawlinson, asks the rhetorical question: Why should there be a case for compensation? I think it is clear from the contributions of noble Lords and noble Baronesses who have spoken in support of this proposition that the overwhelming case is because the spouse concerned is at the very centre of the disaster area that has been created in that family unit by the death.
I accept that there will be serious difficulties of definition. I also accept that it will be difficult but—as my noble and learned friend Lord Elwyn-Jones has said—certainly not impossible for a court, in examining the nature of the relationship, to come to a conclusion on what cases fall within the category and what cases fall outside it. The cases that would fall within the category, if I may put it in this way, should be the "Doolittle" families of this world. I am sure many in the Committee will remember the argument put forward by Bernard Shaw in relation to that family in Pygmalion, that that relationship was more secure than many relationships that were based upon the formal contract of marriage.
There are difficulties of definition, and I am sure that a very wise and practical path has been pointed out to the Committee by the noble and learned Lord, Lord Edmund-Davies, when he referred to the wording of Clause 3(3)(c). It may well be, however, that the amendment will need some slight adjustment, for it refers to a person treated as a wife. It is not impossible, of course, for there to be more than one person so treated in succession—possibly, indeed, not even in succession but concurrently, so that there would have to be some marriage of that important principle with the principle that is contained in the amendment as drafted.
If I may be so utterly rash, it may be that they can be put together in wording of this nature:
"A person who immediately up to the death has been treated by the deceased as a spouse and maintained as such by him".
That is only a suggestion, but I am sure that with good will these technical difficulties can be overcome.
The Lord Chancellor: I do not need leave to speak, but I do not want to intrude on the Committee unnecessarily. I should like to comment on one or two of the other speeches which have been made since I intervened earlier. I assure the noble Lord, Lord Kaldor, that this is not a question of moral judgments
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about living in sin or anything like that. It is a question to my mind of a very real and difficult problem. I am very anxious—much as I want to help—not to introduce too many difficult and possibly insoluble problems into a Bill which is designed to tidy up part of the statute book.
I am quite sure that reputation at the moment of death is not the right criterion. I was very sympathetic to what my noble and learned friend Lord Edmund-Davies said about a permanent relationship, which rather underlay what the noble Lord, Lord Elystan-Morgan, said a moment ago. I do not think that "treated at the moment of death" helps very much. If I spend a weekend with somebody at the Metropole Hotel, Brighton, register under my name and say to the people with whom we had lunch, "Meet my wife" I am not at all sure that I am not treating her as my wife. Indeed, in Scotland I believe that the most disastrous results might follow.
At any rate, it is more difficult than has appeared. I do not know about the wisdom and the competence of our courts to decide all difficult problems. The difficulty that I see about this—and I say this to the noble and learned Lord, Lord Elwyn-Jones—is that it is either all or nothing. This is one of the difficulties. You have to have a test, a fence, on one side of which somebody who might describe herself, or himself for that matter, as a dependant gets everything—that is to say, they are treated as persons entitled to qualify under the Fatal Accidents Act for damages against a tortfeasor—and on the other side they get nothing. That is to say, you are outside the pale, and a virtue I mentioned of the marriage status is that it is something which is ascertainable; one can find out what it means and one can establish in 19 cases out of 20—probably more—whether that degree exists.
However, if one is going to rely on something like a permanent relationship or an indefinite relationship, as in the Doolittle case, one gets a situation in which one must ask the parliamentary draftsman to say that 12 months will do and six months will not or five years will do and four years will not. I find myself in great difficulty in regard to ingenuity. They talk about my ingenuity and humanity; I hope I have both, but I warn the Committee that both will be taxed to the extreme limits before I can necessarily give in to this principle. All I can promise at this stage is to do what I said at the outset, which is to consider. I am not absolutely sure that the right answer would not be to refer to one of the law reform agencies the whole question of the position of—and I am now using the phrase for the first time without inverted commas—the common law wife. Having said that, I think that I have gone as far as I can.
Lord Elwyn-Jones: Having initially said he would consider the matter, the noble and learned Lord is moving adverbially in the direction of favourably eon sidering the matter—I detect from his last intervention. There is common ground in the Committee that there is a social need here that ought to be met and that could be met. We would he reluctant to accept the difficulties of drafting as a ground for doing nothing in a field where real social misery and social injustice will result unless we do something. However, in the light of the willingness of the noble and learned Lord

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to consider the matter further, I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mishcon Lord Mishcon moved Amendment No. 2:
Page 3, line 41, leave out ("bereavement") and insert ("loss of society").
The noble Lord said: With the leave of the Committee, may I speak to Nos. 2 and 3 together, because precisely the same point is involved? Your Lordships will remember that at Second Reading we dealt with a new concept under this Bill in regard to a head of damages which would be awarded as a result of a fatal accident where there was culpability. That head of damages replaced another head which goes under the Bill—that of loss of expectation of life. One is on a question here in these two amendments not only of terminology but, if I may say so, of sensitivity. With regard to the head of damages, the limit under the Bill is £3,500 and is said to be that of bereavement. I ventured to say at Second Reading—I am not the only person who has said it—that it is somewhat insensitive, to say the least, for Parliament to measure what is called a bereavement for a child and a spouse as something which has a limit of £3,500 or £5,000 or £10,000, making that the measure of what Parliament is supposed to award in a case of that kind for the bereavement sustained.
The Pearson Report dealt with this matter and borrowed a phrase from the law of Scotland—and no worse for that—which is "loss of society". That is the phrase used by Pearson, in fact advocating a different measure of damage, because according to the law of Scotland there is no limit to that damage. Pearson recommended a measure of damage which was attuned to the income, the earnings, of the deceased person. It may very well be thought that it is a difficult task enough, as again I tried to say at Second Reading, for any legal practitioner trying to protect and comfort somebody who has been put in the position of a wife with no longer a husband or a child with no longer a father. It is always very difficult, if I may speak from personal experience, to talk about the way in which Parliament has dealt with such pecuniary compensation as can be paid, because of course money cannot make up for the loss of a dear one. If I may speak personally again, I used to have so much difficulty in explaining the head of damages of loss of expectation of life, especially if it were a comparatively young person involved, and telling the member of the family concerned in modern times that that, as a result of various decisions, £1,250 was the figure—almost a fixed one—for loss of expectation of life. I could manage that much more easily—that would be a head of damages that will have gone if this Bill is passed—than I could ever try to explain to somebody this head of damages under "bereavement".
My last argument in trying to persuade the Committee, I hope with not too much difficulty, that "loss of society" is better phraseology, is strengthened by Amendment No. 10, which is to be moved later by the noble and learned Lord the Lord Chancellor. The noble and learned Lord in that amendment is asking the Committee to agree that the right of a person to claim under this section, which would the bereavement
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claim, shall not survive for the benefit of his estate on his death. In other words, if the person who was to be the plaintiff is no longer there because he has passed to a better world, that means that the claim of bereavement will not survive him. Logically, that person suffered the bereavement even if he or she might die very soon afterwards.
Indeed, the very bereavement may have been responsible for the death almost immediately afterwards. How illogical therefore, one might think, if the term "bereavement" is used, that it does not survive the death of the otherwise plaintiff. But if it is a loss of society, how logical that it should not survive, because indeed the loss of society has been so short and if that is the head of compensation, however unfortunate or miserable the succeeding death, it is logical to say: "There has been very little loss of society by virtue of the short period that has elapsed between the two fatal incidents."
Therefore, I hope the Committee will feel that in regard to this new section of the Bill which is, if I may put it very humbly, a very sensible section, we ought to get our terminology right—not just because it is sensible for Parliament to be exact but because it is right that Parliament should be sensitive and feeling. I beg to move.
The Lord Chancellor: This has rather taken me by surprise, and perhaps I had better express my surprise before there is any debate. I was expecting this to extend to a wider range of topics under this head than in fact the noble Lord has chosen, quite within his proper rights, to place together. At first sight the question is simply one of semantics, though it may be one of taste and sensitivity as well. I do not think it really is that, because there is going to be—and perhaps we can deal with it as and when these amendments are moved—a rather more profound debate underlying it, as to which I fancy I take a less sympathetic view than I would take simply on the question of nomenclature.
I think that if we look at the sequence of amendments which bear the name of the noble and learned Lord and his noble friends opposite, what he is seeking to do is not simply to change the concept of damages for bereavement, which is the selection I have made, into a thing which is the same in character but simply has a different name. I think perhaps we would be wasting the time of the Committee in arguing about semantics in that sense. He is really taking a totally different concept of what he wants to insert instead. He is taking what I might call, without disrespect to my noble and learned friend who is sitting exactly on my right, the Scottish definition of "unlimited damages" for loss of society, and substituting that for the conventional figure which, for reasons that I explained on Second Reading, I had selected instead, and which I have chosen to describe as damages for bereavement. There is a fundamental difference of philosophy, therefore, which will emerge as we go on. It may be that I do not want to spend too much time on this issue—is the noble Lord seeking to intervene?
Lord Mishcon: Only, I hope, to help the Committee and, if I may say so respectfully, the noble and learned Lord. I am trying to deal with this matter in two ways:

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first, preserving the whole of his concept of bereavement, but merely altering the title to "loss of society". It may very well be that the Committee will decide that it is proper to fix a limit to that, and it may be the £3,500 proposed in the Bill. As a different point, I shall venture later on to move an amendment to say—whether it be bereavement, loss of society or whatever it be called—that there should be no limit, as indeed there is no limit in Scottish law. My last observation—hopefully to assist the noble and learned Lord—is that, recognising the difference in the law of Scotland where the claim is unlimited, and saying that the law of England, against my argument, should have a limit to this claim, I call it the same as in Scottish law, which is loss of society, even though the recommended limit is very similar to that proposed in this Bill. My points are separate.
The Lord Chancellor: I am very grateful to the noble Lord. But what I was about to say has a certain relevance to the question of nomenclature, which is all that is technically under discussion, because, in addition to removing the limit and therefore changing the conception from a conventional figure to one of solatium, the noble Lord is also going to add to the classes of those who are entitled to the solatium the unmarried child who is a minor. I think that the dispute which we are now having may depend ultimately on the decision to which we come subsequently on some of his later amendments.
Let us suppose that he were to succeed, against, probably, the advice which I am going to give to the Committee, in getting the unmarried minor child added to the class of those entitled to this type of solatium, and let us suppose that there is a child who is aged six months. The loss of society involved in the loss of a parent is virtually nil. It may be a loss of expectation of future society, but, in fact, there is no loss of society, because a child of six months is unaware, very often, of having a father, although it is usually aware of having a mother.
On the other hand, I can cast back—and it is very difficult for me not to speak about this in personal terms, especially as the noble Lord, Lord Mischon, has appealed to sensitivity—because I lost my mother when I was 17. It was a catastrophic event in my life. I had, of course, had her society throughout my boyhood and, to that extent, I suffered less than a child of six months. Yet if you treat it as loss of society and not damages for bereavement, you are getting yourself into the difficulty that if you succeed in inserting this new class—and this is only an example which I am using by way of illustration into—as a separate issue, you will probably achieve less just results than if you leave it as it is.
After all, bereavement is a very definite fact about human life. Loss of society, the society that one gets from one's nearest and dearest, is very much a matter of degree, kind and arguability. Bereavement is a fact. It is caused by death. You can say what it is and when it happens. You can describe it, therefore, by the name which it has. I believe that the Law Commission was right—on the assumption that you accept the philosophy of what I am going to argue about on subsequent amendments—to keep the name as it is. If I were to be defeated by the persuasions or by the
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votes on subsequent amendments I might, of course, revise my opinion. Therefore, I simply say that we had better pass from this and see how the whole sequence goes, and then on Report stage we can decide on our nomenclature. I do not know whether that is commendable to the Committee, but I feel that this is probably the best way forward.
Lord Scarman: I hope that the Committee will stick with the word "bereavement". It illustrates exactly what this conventional award, which is now introduced, is intended to deal with. It is compensation for grief. It is not loss of society. It is loss of a person by death. It is very limited. It is very conventional. It amounts only to a recognition by the state that, in such a situation as this, the fact of bereavement should qualify for some sympathetic recognition. I think, therefore, that the word "bereavement"—it is only one word, instead of three or indeed five—should stand as appropriate.
I think that this is necessary. Otherwise, we are going to have a debate as to why the Lord Chancellor, by order, should vary the sum. What criteria is he taking into account? Is he thinking of inflation? Is he thinking of the quantum of society? This is just a small contribution by the state to the recognition of a spouse's, or a parent's, loss and the grief caused by that loss. Let it remain there in a small, but sympathetic, compass.
Lord Rawlinson of Ewell: I have always thought that for the law to attempt to assess by monetary award some recompense for grief is absurd. I have always thought that it is something which the law cannot do, and which the law should not seek to do. Certainly, it should seek for the monetary compensation to try to put back people into the position in which they were before a great loss was suffered. But for the law to set out and to put in pounds, shillings and pence, as it was, or in pounds and pence, as it is now, some sum is ridiculous. I have been told that I must move with the times, and move with the times I must, and if the money has to go up to £3,500, then up to £3,500 it had better go. But I agree with my noble and learned friend Lord Scarman that what the law wants here is bereavement. Bereavement is what it is meant to be about, though I can see the point made by the noble Lord, Lord Mishcon, about the loss of society. But it is bad enough trying to measure bereavement. Therefore, like my noble and learened friend Lord Scarman, I prefer to keep the word "bereavement".
Baroness Phillips: I should like to support the noble and learned Lord who has just sat down, and I apologise to my noble friend here. This is an example of a debate in which we minor Peers feel very inadequate. We are now listening to a slightly erudite discussion between noble and learned Lords who sit on this Bench and noble and learned Lords who sit on the Bench opposite. But, as a mere magistrate, I would say that the law should be understandable by the common man; or, for that, now read "common woman". The common person understands bereavement. I am not sure that he or she understands the more sophisticated overtones which are now being, introduced.

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Perhaps I could make a plea at the beginning of this Committee stage: if your Lordships really want the rest of us to take part in this debate, it should be remembered that, although we have not got the experience and perhaps the training of those of your Lordships who practise law, we are here as the makers of law. This is a very important point. I hope it will be remembered that we must try to speak for the people outside who need to understand the law if they are to get common justice. Therefore I would support the simplest words. I think that "bereavement" is a very simple word and, as a widow, I endorse what has been said. Nobody can possibly assess any loss in hard cash. We all know that. Compensation cannot be assessed in hard money terms, but bereavement is something which we all understand.
Lord Mishcon: I think the Committee will have been delighted, on a rather sombre subject, to have had the benefit of so much wisdom, some of it esoteric and some of it extremely pragmatic. In those circumstances, and especially in view of what the noble and learned Lord said about the convenience of discussing this matter after other amendments, I beg leave to withdraw.
Amendment, by leave, withdrawn.
[Amendment No. 3 not moved.]
4.21 p.m.
Lord Mishcon Lord Mishcon moved Amendment No. 4:
Page 3, line 44, after ("husband") insert ("or unmarried minor child").
The noble Lord said: In view of what the noble and learned Lord said about damages for bereavement and those who are entitled to claim under that head, I do not propose to bore your Lordships with a long speech. We now know what we are dealing with, whether it be called "loss of society" or "bereavement". In his intervention, the noble and learned Lord, Lord Scarman, spoke in terms of some gesture by society, by Parliament, which recognises grief, and I think that the noble and learned Lord, Lord Rawlinson, said something of the same kind. Realising—as we all do—that we cannot really measure this in pounds, shillings and pence, if I may use an old-fashioned phrase, there ought to be a gesture by society, by Parliament, which recognises grief and bereavement.
The extraordinary thing is that excluded at the moment from the Bill as one entitled to receive that gesture from society, from Parliament, is the child of the person who is the victim of a fatal accident. That seems to us to be quite unacceptable, especially if one limits this to the unmarried minor child. May I say at once that the Pearson Report which dealt with an analogous head of damages, included the unmarried minor child? I go on to say that the difficulties which have been put, so far as I know them, in the way of including the unmarried minor child are the following: first, that it necessitates some form of inquiry as to where the children are—the children I have read of in other debates relating to this matter may be spread all over the world, which is a very unlikely happening, the Committee may well think, in regard to an unmarried minor child. Secondly, that the unmarried
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minor child is most likely going to be a dependant, anyway, under the Fatal Accidents Act. But the surviving spouse is also a dependant under the Fatal Accidents Act.
Your Lordships may well think that there are many cases which all of us—lawyers and laymen alike—can envisage where there would not be a claim as a dependant by an unmarried minor child under the Fatal Accidents Act. What happens if the mother who is not the breadwinner is killed in a fatal accident? In those circumstances, there is no claim by the unmarried minor child. There is no monetary dependency. This is the only way in which we can make a gesture to the unmarried minor child. And what about the case of the father who is suffering from some disability, whether it be blindness or crippling, where the mother has to be the breadwinner: If the father happens to be killed, there is no gesture by Parliament recognising the grief sustained by the unmarried minor child for the loss of the father. He, most likely, was very much more in the company of the child than the mother who in those sad circumstances had to go out to work. There is no gesture at all recognising the grief of which the noble and learned Lord, Lord Scarman, and the noble and learned Lord, Lord Rawlinson, spoke. It seems wrong that the unmarried minor child is excluded and I hope that the Committee will agree with that view. I beg to move.
The Lord Chancellor: Again I am not intending the smallest degree of criticism of the way in which the noble Lord, Lord Mishcon, has chosen to put his amendments, to some extent, in the order in which they come, for which there is normally an overwhelming case; but I find myself rather embarrassed in dealing with this amendment because I had hoped that in one way or another we should deal with this sequence of interdependent amendments more or less as a whole. With great respect, I think one has to make up one's mind what is the philosophy you are trying to introduce into the Fatal Accidents Act when you are trying to introduce any change at all of this kind. I entered into this at some length in my Second Reading speech, but, in dealing with what is really the question of the unmarried minor child, I find myself driven to appeal to the question of philosophy before I deal with the particular case.
I disclosed, quite plainly, my own hand on Second Reading. I said beyond doubt that I share the original philosophy of Lord Campbell's Act. The noble and learned Lord's predecessor, and mine, Lord Campbell, first introduced damages for fatal accidents based entirely on financial loss. He did not do so because he was living in the middle of the 19th century, if I may borrow a phrase from the noble Lord, Lord Kaldor. He did not do so because he as an uncompassionate man. He did so because he thought, basically, that it was degrading to human nature to try to capitalise grief. I disclosed my hand perfectly candidly to the House on Second Reading. I take that view myself.
I receive letters from time to time in which people say, "It is an insult to my wife, to my child, that this sum has been mentioned in connection with their death". But my reply to them always is, "What sum

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would be enough which would not be an insult?" And the bigger the sum in a sense the bigger the insult, because it means you can turn grief into money. A I do not believe that you can. I personally entirely accept the view put forward rather robustly by my noble and learned friend Lord Rawlinson. I said at Second Reading, and I say again, that when one has lost a wife, one does not think in terms of money to compensate for one's grief. I know that the law of Scotland is different. It believes in unlimited damages for loss of society, as it is called in Scotland.
The Law Commission and the Pearson Commission decided, with a wide measure of agreement (I think quite illogically, but still it is what the Bill says and what I am here to put forward, and there were two important dissensions within the Royal Commission) that one cannot have unlimited damages because there is no yardstick by which they can be measured, and it is an insult, in the sense that it is degrading to human nature, to try to find such a yardstick. However, both commissions said that they would recognise a conventional figure. The Law Commission's decision, which I followed with some upgrading for inflation, was to decide on a fixed sum of money which could be altered by the Lord Chancellor form time to time. The Pearson Commission decided on a sum of money calculated by a formula related to the average earnings of the average income earner at the time of the death. I think that both are illogical, and I have said so again and again, but I do believe these recognise in some way—and the noble and learned Lord, Lord Elystan-Morgan, with whom, frankly, I did not agree none the less put this very well—that society does attach importance to human grief. Therefore, the Pearson Commission decided on a conventional figure.
For this purpose, it does not matter whether one chooses the Law Commission's fixed sum or the Pearson Commission's formula. In my law reform, I like to back the informed opinion of experienced people even when, as in this case, my own instincts are quite contrary to what they have decided; I believe it probably does represent the informed public conscience of mankind, and so I find myself recommending the formula. One of the results of the formula will be that the more people one puts inside it, the more one dilutes the sum of money which they get. A woman with 10 children, to take the unmarried minor children, will get practically nothing, although her grief may be as high or higher than the married widow—the previously married widow—with no children or with only one or two children. It was for that reason that the better view, as I shall put it forward, is that the parents may share a grief for the loss of the child and the spouse—not a word I like, but the husband or wife—can take the sum for the loss of the wife or husband, but the unmarried child is excluded. I personally believe that is right. In my view at any rate, the unmarried child, even after I have made my concession to public opinion, should receive that which Lord Campbell originally designed for him or her—namely, the actual financial loss based on a calculation of dependency and with the more generous disregards which we now allow. But to dilute and complicate the kind of calculations which we now have to consider by thoughts of this kind—by dividing it among a large family and possibly among two families, because there may be unmarried children
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of a previous family as well—seems to me impossible to reconcile with the philosophy of the conventional sum, which, rather reluctantly but still without doubt, I have come to put before Parliament. I believe that if we go down this road, we are both complicating and destroying the remaining shreds of logic which the reports of the Pearson Commission and the Law Commission, which for this purpose are to be treated as one, have put before the public.
It is not that I am unsympathetic to the child who has lost a parent. On the other hand, I believe that we have to make certain choices of philosophy and I am pretty sure that I know which is the right one. I feel bound to reiterate a point that I made in our earlier discussions; that if one starts including unmarried minors, one gets into the problem of how one is to talk in terms of grief with respect to the child who never knew its parent—the youngest child of all—whereas the grief of the eldest child is greater. This tends to be so, at least in my own experience. I had the experience of my own children losing their mother recently, and I had the experience of losing my own mother a long time ago. I think that the grief of the child increases with the age of the child, until a given age when the child leaves the parental home—which I suppose is at about the age of majority. I have said what I have to say. I do not pretend that I am arguing an absolutely logical case; I would much rather be arguing the case of my noble and learned friend below the gangways because that argument corresponds with my own philosophy of life. But I have tried to do the best I can for Parliament and I hope I shall be given credit at least for that.
4.37 p.m.
Lord Elwyn-Jones: I see a certain inconsistency between acknowledging the bereavement suffered by a husband or wife and failing to acknowledge and provide for the bereavement of the unmarried minor child; I see a total inconsistency of approach here. I note that the Pearson Commission also rejected acceptance of that inconsistency and, accordingly, I hope that the noble and learned Lord Chancellor may be willing still to accept the necessity for this change once we acknowledge the doctrine of compensation for bereavement.
The Lord Chancellor: I do not believe that I can change from what I have said, because I think, to a greater extent than the noble and learned Lord has given me credit for, that this undermines the philosophy of the Bill which I am seeking to pilot through Parliament. On the other hand, what I suggest would be the way forward is that we leave it at Committee stage and come back to this sequence of amendments at Report stage, when we shall have had the opinion of the Committee expressed on the whole sequence of amendments, so that we can make up our minds on the whole package. I believe that the package stands or falls as a whole and, if you want to have this, you must try a different package. I cannot therefore give much prospect of yielding on this, reluctant as I am to force the issue until the whole sequence has been discussed and gone through.
4.38 p.m.
Lord Mishcon: I find myself in great difficulty, having heard the noble and learned Lord, the Lord Chancellor. He appears to be saying, and I hope that I am interpreting him correctly, that there is here some package which ought to be argued as a package and cannot be dealt with seriatively. What I have tried to argue, and my noble and learned friend Lord Elwyn-Jones has just said this himself, is that, if one decides to try and give a sum of money for bereavement, one must not and cannot leave out, as the Pearson Commission said, the unmarried minor child. I am abandoning here the point of loss of society and bereavement, which is a completely separate argument, for the purposes of this discussion. I am abandoning also for the purpose of this discussion the question of whether it should be £3,500, a fixed sum, or damages at large.
It is as simple as that in my mind. That is the only point covered by this amendment. It is quite without prejudice to any arguments about damages at large or a sum larger than £3,500. It is that narrow principle. That narrow principle, however, in my respectful submission to the Committee, is a terribly valuable one, and, as I repeat, for society, for Parliament not to make this gesture of acknowledgement to the unmarried minor child under this head of damages would in my judgment be quite wrong. I am sorry that the noble and learned Lord, who has a width of mind that usually enables him to be rather less unyielding than he has been on this occasion, cannot accept it. I have heard what he has said, and, if that is really his view, then I think the view of the Committee ought to be tested now, purely on this one point: should the unmarried minor child of somebody killed in a fatal accident through the carelessness, through the negligence, of another be excluded from this bereavement benefit, whatever the amount may be?
The Lord Chancellor: I do not want to intrude on the Committee unduly, but I do not think it is from any lack of width of mind that I fail to impress the noble Lord opposite; nor do I think it is from any lack of sympathy. I think it may be my own stupidity which has failed to get the point across. I do not believe you can reconcile the amendment which the noble Lord has put forward with the Bill as it stands. I believe that in the end it is not a separate point, it is part of the same. If you decide to insert the unmarried minor child, I believe you have killed the conventional sum, and you will then have to go either down the road proposed by the noble and learned Lord, Lord Rawlinson, or down the road of Scotland and have unlimited damages. But I do not think it can be reconciled with the Bill as it stands. Therefore, it is not a separate point, and, if it is passed, you must really make up your mind either that my own instincts are right and it is degrading to human grief to give it money, whether £10 million or £10, which is the view put forward by my noble and learned friend, or alternatively you must go along the road of unlimited damages. I think if you insert this here you are making a nonsense.
This is not my last word at all. Why I suggested the course I did was that I thought that the way things have fallen out, purely because of the order in which
1300
the amendments have been, quite properly, put down, we ought to take a view of the whole package at this stage and consider it before we seek to decide any part of it. Of course, if the noble Lord wants to take the view of the Committee at this stage, he is at liberty to do so, and I am the last person to try to discourage him, although I do not at all want to turn this Bill into a question of votes and Divisions. But I think it is in the interests of a proper discussion of this measure that we go through this part of the Bill with the sequence of amendments about damages for bereavement, as we have agreed to call it at the moment, first, and then on Report decide what we want to do about them, viewed as a whole. I think if you do it piecemeal in this way you are making a nonsense.
Admittedly, what I have suggested in the Bill, what the Law Commission decided in 1973 and what the Pearson Commission decided later is an illogical concept—namely, that you can turn grief into damages but only on condition that you do it in a conventional way. I want to argue that case to the Committee before we vote on this definitively one way or the other. Otherwise we shall get into a nonsense. I want to argue the case about solatium, which is what the total effect of this sequence of amendments put down by the Opposition would be, and to see where we get after having considered the thing in a coherent way and not before. It is not that I want to stop the noble Lord voting, but I think the result of the vote will be almost meaningless in the light of what I have said.
Lord Mishcon: I should dearly have loved to have agreed with the noble and learned Lord, and I should have loved to save the Committee from a vote, but I must confess that, in the interests of the principle that I have been trying, with my noble friends, to adumbrate, it is not possible—will he forgive this?—to understand his reasoning. I say that in all humility and with all due respect.
How one can say that there is a different principle involved in regard to compensation for grief in the case of a minor unmarried child for the loss of a parent, that the same principle does not apply where the parent has lost a child or where the wife has lost a husband—
The Lord Chancellor: I think the noble Lord meant to say the opposite. What I am saying is that the Bill gives this conventional sum to a spouse and a parent but not to a child, and I think unwittingly the noble Lord put it the other way round.
Lord Mishcon: If I did, I apologise to the Committee. My noble friend helpfully tells me that I did not, but, if I did, obviously it has been put right on the record now. I cannot see that there is the slightest difference in the principle involved. I agree with the noble and learned Lord that either you say there is no compensation to be awarded for grief of this nature because you cannot have it—I understand that point—or you say, yes, we ought to make that recognition, in which case how can there be a difference in principle between the spouse who has lost a husband, the spouse who has lost a wife or the parent who has lost a child, on the one hand, and, on the other hand, the child who has lost a parent?
In those circumstances, since I am not in any way allying that principle to an argument of quantum—and

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I promise the noble and learned Lord that he will not hear me argue the case of the minor unmarried child on quantum—and I am certainly not arguing this case of the minor unmarried child on the title to be given under that head of damages, whether bereavement or loss of society; and since this principle stands alone, and alone within the noble and learned Lord's Bill as he has drawn it and in accordance with his very lucid explanation of it, because that is an isolated point and the noble and learned Lord does not recognise that, I have no alternative but to test the view of the Committee.
4.48 p.m.
On Question, Whether the said amendment (No. 4) shall be agreed to:
Their Lordships divided: Contents, 75; Not-Contents, 108.

DIVISION NO. 1

CONTENTS

Amulree, L.

Kilmarnock, L.

Ardwick, L.

Kinloss, Ly.

Avebury, L.

Leatherland, L.

Aylestone, L.

Lee of Newton, L.

Beswick, L.

Listowel, E.

Birk, B.

Llewelyn-Davies of Hastoe, B.

Bishopston, L. [Teller]

Mishcon, L.

Blease, L.

Molloy, L.

Blyton, L.

Monson, L.

Briginshaw, L.

Noel-Baker, L.

Brockway, L.

Northfield, L.

Brooks of Tremorfa, L.

Oram, L.

Bruce of Donington, L.

Peart, L.

Cledwyn of Penrhos, L.

Phillips, B.

Collison, L.

Pitt of Hampstead, L.

Cooper of Stockton Heath, L.

Ponsonby of Shulbrede, L.

Darling of Hillsborough, L.

Rathcreedan, L.

David, B.

Reilly, L.

Davies of Leek, L.

Richardson, L.

Davies of Penrhys, L.

Ross of Marnock, L.

Elwyn-Jones, L.

Segal, L.

Elystan-Morgan, L.

Shackleton, L.

Ewart-Biggs, B.

Shinwell, L.

Fisher of Rednal, B.

Stamp, L.

Gaitskell, B.

Stewart of Alvechurch, B.

Gifford, L.

Stewart of Fulham, L.

Glenamara, L.

Stone, L.

Gosford, E.

Taylor of Mansfield, L.

Grantchester, L.

Underhill, L.

Gregson, L.

Wade, L.

Houghton of Sowerby, L.

Wallace of Coslany, L. [Teller]

Hunt, L.

Walston, L.

Hutchinson of Lullington, L.

Wedderburn of Charlton, L.

Jacobson, L.

Wells-Pestell, L.

Jeger, B.

White, B.

Jenkins of Putney, L.

Wilson of Radcliffe, L.

John-Mackie, L.

Wootton of Abinger, B.

Kaldor, L.

NOT-CONTENTS

Abinger, L.

Berkeley, B.

Airedale, L.

Bessborough, E.

Airey of Abingdon, B.

Birdwood, L.

Alexander of Tunis, E.

Bridgeman, V.

Allerton, L.

Brookeborough, V.

Alport, L.

Cairns, E.

Ampthill, L.

Cathcart, E.

Auckland, L.

Clinton, L.

Avon, E.

Clitheroe, L.

Belhaven and Stenton, L.

Cockfield, L.

Bellwin, L.

Colville of Culross, V.

Beloff, L.

Cork and Orrery, E.

1302

Craigavon, V.

Mersey, V.

Cranbrook, E.

Milverton, L.

Cullen of Ashbourne, L.

Monk Bretton, L.

Daventry, V.

Mottistone, L.

Denham, L. [Teller]

Murton of Lindisfarne, L.

Dundee, E.

Newall, L.

Ebbisham, L.

Nugent of Guildford, L.

Elliot of Harwood, B.

Onslow, E.

Evans of Claughton, L.

Orr-Ewing, L.

Faithfull, B.

Pender, L.

Ferrers, E.

Portland, D.

Foot, L.

Rankeillour, L.

Forester, L.

Rawlinson of Ewell, L.

Fortescue, E.

Reigate, L.

Fraser of Kilmorack, L.

Renton, L.

Glasgow, E.

Rochdale, V.

Gridley, L.

Rugby, L.

Haig, E.

St. Aldwyn, E.

Hailsham of Saint

St. Davids, V.

Marylebone, L.

St. Just, L.

Hampton, L.

Saint Oswald, L.

Hankey, L.

Sandford, L.

Henley, L.

Sandys, L. [Teller]

Hives, L.

Seear, B.

Home of the Hirsel, L.

Sharples, B.

Hylton-Foster, B.

Skelmersdale, L.

Inglewood, L.

Soames, L.

Killearn, L.

Stanley of Alderley, L.

Kimberley, E.

Stodart of Leaston, L.

Kitchener, E.

Strathcona and Mount

Lindsey and Abingdon, E.

Royal, L.

Lloyd of Kilgerran, L.

Strathspey, L.

Long, V.

Swansea, L.

Lucas of Chilworth, L.

Swinfen, L.

Lyell, L.

Thomas of Swynnerton, L.

McAlpine of Moffat, L.

Trenchard, V.

McFadzean, L.

Trumpington, B.

Mackay of Clashfern, L.

Tweedsmuir, L.

Mackie of Benshie, L.

Vaux of Harrowden, L.

Mais, L.

Vivian, L.

Mancroft, L.

Westbury, L.

Margadale, L.

Willoughby de Broke, L.

Marley, L.

Wise, L.

Resolved in the negative, to accordingly.
4.56 p.m.
Lord Mishcon Lord Mishcon moved Amendment No. 5:
Page 4, leave out lines 7 to 9.
The noble Lord said: I beg to move Amendment No. 5 and with the permission of the Committee I should like to speak at the same time to Amendment No. 6 because both amendments relate to the same point—namely, that there should be no limit on the damages in a bereavement claim. The noble and learned Lord, the Lord Chancellor, was right when he inferred that the argument had very largely taken place in a general discussion of this matter. I do not intend to weary the Committee with any repetition of arguments.
Let me put my case very simply by saying it is right, in my submission, that there should be no arbitrary sum fixed for this bereavement claim. I am saying that the damages should be at large. I am saying that it was decided that, under the law of Scotland—in accordance with the recommendation of the Scottish Law Commission, as I remember it—there should be no limit to a claim under the heading of "loss of society", which is almost the same claim as the one which we are now discussing; that they have had no difficulty in their courts, so far as I know, in making a proper assessment, after inquiry, under this head; and that I see no reason why we should walk, as I said again on Second Reading,

1303
into the anomalous situation where, if there is an accident just over the border there is no limit to the claim, but if there is an accident this side of the border there is an arbitrary limit to it. Having said that, I think that I have said everything that I can say succinctly in support of the amendment. I beg to move.
The Lord Chancellor: I seem to be getting up all the time, but I hope that I may be forgiven. I think that this really is the kernel of the question which we have really got to decide. The Law Commission and the Pearson Commission have both decided that damages for bereavement should consist of an arbitrary sum—not the same arbitrary sum. The noble Lord in invoking the law of Scotland to my mind might just as well have involved the law of Sweden—although I know no more than he does about what it says as regards this—because we all know that the law of Scotland is in some respects vastly superior to our own and in some respects a miserable reflection of the worst features of English law. But to my mind this is the heart of the matter. Let us suppose that a man loses his wife. In my case, thank God! no one was to blame, so I would not get anything under this Bill, and I did not want to get anything under this Bill. But how do you translate that into money which is not degrading to human nature?
Let us suppose that my wife had been killed in a road accident in this country and under the Bill I had sued. £3,500 might mean a little less to me than it would to a coalminer who had lost his wife and who receives only £100 a week, or whatever it is. Would one take that into account to give me more or less? Will wilful poverty count in your unlimited sum? To my mind it is a meaningless question. It is no good people saying, "Oh well, juries do it in America". We all know that juries do it in America, with what appalling results. It is no good saying that they do it in Scotland, because if you ask a judge an idiotic question, you get a foolish answer. Will you go into the quality of the relationship between the husband and wife?—so that if they were very happy and had been married a long time they would get a lot, and if they were not getting on very well and had quarrels, they would get a little. Will you resurrect the hideous and rather ugly arguments we used to have on damages' claims about the widow's prospects of remarriage?—which were laid to their quietus, I think perhaps unfortunately in the form which the quietus took, during my first term of office. I do not think that anyone would want that.
But how much will you pay the husband for the loss of a wife, or the wife for the loss of a husband, or the parent for the loss of a child? I do not think that there is an answer to this. Will you take into account the degree of blameworthiness in this calculation? There was no guidance in the noble Lord's speech or in the noble Lord's amendment. I am thinking now of a case which I saw in a private letter only three days ago. On a very wet night when visibility was bad a girl was knocked down and killed as a result of a very slight degree of negligence. Will that rate for lower damages than if the same girl had been killed as the result of a drunken driver—a hit and run driver—who is very much to blame? What about the
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blameworthiness of servants in this situation: How will you divide up the sum of money? Is the widow to get a separate sum and the children, if you had the children, separate sums? Are the husbands and wife to share the total sum, or will they get separate awards of damages?
I ask these questions not because I want answers, because I know very well that there are no answers which would ever make sense. I believe that the right answer is the answer given by my noble and learned friend Lord Rawlinson, and I have never concealed that. But two Law Commissions have said, "Yes, give damages for bereavement; make it a conventional sum, and allow"—says the Law Commission, as distinct from the Pearson Commission—"for inflation by giving a regulatory power".
It is between those three options that you have to choose. One I believe to be totally meaningless and degrading to human nature, when death is treated as a sort of auction between opposing counsel in a fatal accidents case; and there is my own view, that Lord Campbell was right when he passed his Act, that you cannot turn human grief into money; and there is the view of the great, the good and the wise, which I am putting forward as being the consensus of wise, good and noble human opinion in this country, that you do it by a formula and a conventional sum, making no difference between happy or unhappy marriages, no allowance for remarriage, and no difference between rich and poor, but simply say, "We, out of the conscience of society, give a conventional sum to those who have lost their nearest and dearest; we cannot do better than that; it is only human justice; it is not divine justice, and we must stick by that".
Personally, I know where my heart is and I have said so. It is in favour of dependency only, which was Lord Campbell's original conception. But if we are to have damages for bereavement, let us have the Bill as it stands.
Lord Elywn-Jones: We have had one gnomic silence in the course of this debate, and I wish that we could have had it broken. Scotland has managed to apply a law which the noble and learned Lord the Lord Chancellor has now been dismissing in the most fierce terms.
The Lord Chancellor: Oh, no, not fierce.
Lord Elwyn-Jones: They have lived with it in Scotland since 1976. I hate teasing the noble and learned Lord the Lord Advocate, because he is such a nice man and such an old friend, but it would have been interesting if he could have lifted the veil of silence—
The Lord Chancellor: He might agree with me.
Lord Elwyn-Jones:—and let us know what has been going on in Scotland, which has been applying the very kind of doctrine which my noble friend Lord Mishcon has been advocating. The noble and learned Lord the Lord Chancellor conceded that in some respects Scottish law is far better than ours. Of course, it is. One has heard about the inscrutable Scot, but I have never believed it to be a state of

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humanity that exists. But here he is, the very embodiment of it. I do not suppose that I shall get him to his feet on this occasion, but perhaps before we part with this Bill we shall return to this matter again.
However, the problems which have been raised by the noble and learned Lord the Lord Chancellor are, of course, serious problems. The conclusion that we have reached is to accept the apparent persistent and, we hope, superior wisdom of two commissions which have recommended the conclusion to which the Bill has come. I suppose that in a world of fallible human judgment, that is as good as anything that we can hope for. But I am not sure that it is a wholly satisfactory conclusion. I am bound to say, however, that I would not go to the stake for any different one. If only I could have heard what the noble and learned Lord the Lord Advocate had said by way of guidance.
Lord Foot: I should like to intervene for a moment in order to give my unqualified support to what has been said by the noble and learned Lord the Lord Chancellor on this matter. I do not say that because I shall shortly be moving some amendments myself and hoping to curry favour with him. I only want to say a word or two about the argument that has been used, namely, that they have had this system in Scotland since, I think, 1976 and that there is no reason to suppose that it has not worked perfectly admirably. I should have thought that there is every reason to suppose that it has not worked admirably, because, as the noble and learned Lord has said, today the Scottish courts are being called upon to answer unanswerable questions. Who is to know what indignation there may be in some of these cases where an award of so much is given to one person and an award of half that amount is given to another? This is an argument which is used far too often in this House and elsewhere—that they have done this in other countries in the past and it seems to have worked all right.
I remember that it was used in the discussion on seat belts. We were told that they had had them in Australia and in New Zealand, or somewhere, and they seemed to have worked perfectly well; whereas, of course, Members of this House had no idea how the law had worked in Australia or New Zealand at all and it might have been almost disastrous. So I reject that argument. I certainly hope that on this occasion at any rate, noble Lords sitting on the Opposition Front Bench will not press this amendment to a Division.
Lord Rawlinson of Ewell: I have made clear my attitude with regard to damages for bereavement. But let us reflect for a moment what this could lead to if we had damages at large. I do not know what it is like in Scotland; none of us knows what it is like in Scotland. I suppose the cynic would say that, if the wife was killed after the marriage ceremony on the way to the wedding reception, the husband in those circumstances might get vastly more money than someone who has been married for 10 or 15 years, on the calculation that this was going to be a wonderfully happy, exciting marriage.
That has to be contrasted with somebody who has been married for 10 years, and then let us say that
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there were lots of difficulties during the course of that marriage, and therefore, so much. The whole thing is so shoddy that we are better to stick with this statutory figure which has been fixed by the Law Commission. Therefore, irrespective of what happens north of the border or anywhere else, I am quite sure that this is the best solution, although if I had my way the whole of this clause would come out of this Bill.
Lord Elwyn-Jones: I think I have made it clear that we do not intend to press this amendment. It might shorten time if I indicated that at this stage.
Amendment, by leave, withdrawn.
[Amendment No. 6 not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 7:
Page 5, line 23, at end insert—
("(3) In section 3 of the Carriage by Railway Act 1972 (which provides that a person who has a right of action under that Act in respect of the death of a railway passenger shall not bring an action under the Fatal Accidents Act 1976)—

(a)in subsection (1)(a), at the beginning there shall be inserted the words "subject to subsection (1A) below,");

(b) the following subsection shall be inserted after that subsection—

"(1A) Nothing in subsection (1) above affects the right of any person to claim damages for bereavement under section 1A of the Fatal Accidents Act 1976."; and

(c) in subsection (4) after the word "Order", in the second place where it occurs, there shall be inserted the words ", the reference to section 1A of the Fatal Accidents Act 1976 in subsection (1A) above shall be construed as a reference to Article 3A of that Order".").

The noble and learned Lord said: I think I can call this a technical amendment because it extends the right to damages for bereavement not only to the Fatal Accidents Act 1976 but to the Carriage by Railway Act 1972. I think this is a logical extension and I think I can call it technical. I beg to move.
On Question, amendment agreed to.
Clause 3, as amended, agreed to.
Clause 4 [Exclusion of Law Reform (Miscellaneous Provisions) Act 1934]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 8:
Page 5, line 25, leave out ("substituted for the proviso to") and insert ("inserted after").
The noble and learned Lord said: This is to correct a mistake; not quite as the noble Lord, Lord Mishcon, said earlier. The object is that we have somehow succeeded by draftsmanship in killing the action for damages under this part of the Bill if the tortfeasor dies as well as if the injured victim dies. This is to correct that mistake. It is hardly technical, hardly drafting, but it is certainly right. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 9:
Page 5, line 27, at end insert ("(actions to survive death)").
The noble and learned Lord said: This is consequential on the last amendment. I beg to move.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 10:
Page 5, leave out lines 28 to 31 and insert—
(""(1A) The right of a person to claim under section 1A of the Fatal Accidents Act 1976 (bereavement) shall not survive for the benefit of his estate on his death.".").
The noble and learned Lord said: This also is consequential. I beg to move.
On Question, amendment agreed to.
Clause 4, as amended, agreed to.
Clause 5 [Maintenance provided at public expense to be taken into account in the assessment of damages for personal injuries]:
Lord Foot Lord Foot moved Amendment No. 11:
Page 5, line 45, at end insert—
("(2) The Lord Chancellor may by order made by statutory instrument fix such sums or formulae as he may think fit for calculating any such saving to be taken into account under subsection (1) above.").
The noble Lord said: It had been my intention originally to move these two amendments at the same time with the leave of the Committee, but on reflection it would be simpler and easier to dispose of the matter and not take up the time of the Committee if I move this amendment on its own. It probably will be self-explanatory and scarcely in need of explanation. Clause 5, as now drawn, provides:
"In an action…for damages for personal injuries…any saving to the injured person which is attributable to his maintenance wholly or partly at public expense in a hospital, nursing home or other institution shall be set off against any income lost by him as a result of his injuries".
The sole purpose of this small amendment is to provide a mechanism by which the amount of that maintenance can be more readily ascertained. The proposal is that it should be in the power of the Lord Chancellor to make a statutory instrument fixing such sums or formulae—I am not sure whether "formulae" is a suitable word:
"as he may think tit for calculating any such saving to be taken into account under subsection (1) above".
I beg to move.
The Lord Chancellor: This is an amendment which I am sorry that I cannot accept. I fully acknowledge the valuable and constructive thought lying behind it. As it is not a subject about which I could speak with any great authority, I hope I may make rather full use of my notes at least on this occasion. The two amendments, this and the following one, seek to introduce a new paragraph into Clause 5 (which provides that any saving made by the injured person by reason of his maintenance by a hospital at public expense shall be taken into account in assessing damages) empowering the Lord Chancellor to fix sums or formulae by which a saving may be calculated. A further section would then be inserted providing that an injured person who has received benefits at public expense from medical treatment, special appliances or certain social security benefits, should be obliged to notify the body concerned if he commences proceedings.
Lord Foot: May I interrupt the noble and learned Lord? I said at the beginning that I had had it in mind to move both amendments at the same time. As I
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understand it, the noble and learned Lord is going on to my second amendment now, upon which I have not yet spoken to the Committee at all.
The Lord Chancellor: Of course, I mean no discourtesy to the noble Lord. It was really for the reason that I hoped he would allow me to make fairly copious use of my notes. Certainly I shall reply separately to his second amendment when I have heard his arguments on it, but in the opinion of those advising me the two correspond rather with his first inclination than his actual progress. If we have understood it wrongly, it is better that I should deploy the argument as it has appealed to my advisers rather than that I should seek to separate them in my own mind, having been previously advised that they are in effect inseparable.
Lord Foot: I wonder whether the noble and learned Lord would permit me then to speak now in support of my second amendment, and then what he has to say, which is already written down, will be relevant. This is an amendment which in my view is of some importance. Part I—the part of the Bill we are now dealing with—is concerned with the amendment of the law on civil liability for personal injuries and the law on damages in such cases.
Although we have had interesting amendments and some considerable discussion up to now, I think it probably is true that the general effect of this part of the Bill first of all is that it is a fairly modest amendment of the prevailing law, and, secondly, I should have thought that generally speaking it is generally acceptable. Any differences that there may be are upon matters of small detail.
My second amendment is designed to ventilate an aspect of this subject which is, I hope I am right in thinking, of rather greater importance than anything we have been discussing up to now. If I were to attempt to give the dignity of a title to the few remarks that I have to make, I think I would call it The Law of Liability for Personal Injuries in the Welfare State.
I wanted to say a few words about the state of the law on liability for personal injuries before the establishment of the Welfare State as we now know it. I do this with great hesitation because there are still in the Committee many noble and learned Lords who are very much more capable of competently speaking about this matter than I am. I think I am right in saying, in simple terms, that the general law on liability for personal injuries was tolerably well established in this country before the establishment of the welfare state as we now know it. The general rule of law which then prevailed—again, to put it in very simple terms—was that where a person sustained injuries attributable to the negligence of another or to a breach of statutory duty on the part of another, he should be entitled to claim damages against that other party and that the measure of damages should be, first, compensation for pain and suffering suffered and, secondly, compensation for financial loss (loss of earnings and the rest); indeed, financial compensation for all the injuries which flowed from the original act of negligence.
That was the general rule, qualified of course by the law of contributory negligence. When I first started in practice, the law of contributory negligence was not the

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same as it is now, but then we adopted the principles of Admiralty law and introduced the present conception of contributory negligence. The establishment of the welfare state altered the situation fundamentally in a number of ways but, for my present purposes, in two ways in particular. The first was that under the National Health Service, the injured person became entitled to free medical attention and all the other benefits of the NHS; and, secondly, under the system of national insurance, the financial loss that he sustained was substantially mitigated by the provision of industrial injury, disablement, sickness benefit and the like.
What I think is incontestable is that the benefit of those changes accrued to the advantage of the tortfeasor or to the advantage of the employer in breach of statutory duty. To the extent that the state provided for the injured person's medical needs and compensated him for his loss of earnings and the like, the liability of the tort feasor or employer in breach of statutory duty—perhaps I may call him the tortfeasor alone—was substantially reduced. Rather, it would be more accurate to say that often the benefit of the changes which accrued when the welfare state was set up accrued to the advantage of the tortfeasor's insurance. There are two circumstances in which it is compulsory to take out an insurance policy. One is in relation to a motor car (one is obliged by statute to take out a third party policy) and an employer is obliged compulsorily to take out insurance in respect of his workers.
I am aware—I say this in qualification of what I have just said—that the tortfeasor and his insurers do not always benefit to the full extent of the state's contribution to the injured person, and I will give two illustrations of that. In a claim for loss of earnings, the injured person is required to deduct from his claim on the tortfeasor only one-half of the benefits he has received from the state. Secondly, under the Road Traffic Act 1972, insurers are under an obligation in certain circumstances to pay certain strictly limited expenses incurred for medical treatment in a hospital in treating the injured person. However, that provision is set about by all sorts of difficulty, and my information is that in far too many cases it is wholly ineffective and that the DHSS, hospitals and doctors concerned do not ever recover even the limited sums provided for under that legislation.
What cannot be disputed, I suggest, is that very large sums of public money are today being expended by the state, running not into tens of millions but hundreds of millions of pounds per annum—that is not just my assessment—in medical treatment and various benefits which are never recovered from the tortfeasor or his insurers. If that is right, then it is a serious—I will not say "indictment" because that would be too strong a word—state of affairs regarding the arrangements under which we have lived for many years. It means that a heavy burden is being borne by the taxpayer which is properly the responsibility of the tortfeasor and was his responsibility before the welfare state was set up, because in those days the injured person would have been able to claim, for example, the costs of the medical treatment because he had had to pay for it himself.
If it is conceded that there is here a need for some fairly drastic reform, the question arises as to how it might be achieved. I do not intend to canvass the
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various ways which have been thought of by which the situation might be improved, but there is one way by which a claimant in an action for personal injuries might be made the agent of the state for the purpose of recovering for the state the maintenance which has been expended on his behalf. One of the main practical difficulties in achieving any useful result is that under any such scheme as that, if the law is to be effective at all there must be some preliminary procedure by which the state—the DHSS, hospital or doctor concerned—is notified of the existence of a claim, and it is towards solving that initial difficulty in making the claimant, the person injured, an agent for the Crown in recovering for the Crown the monies expended for his benefit that my amendment is addressed.
It provides that the state institution which has provided maintenance shall be notified of the commencement of the proceedings in an action brought by the claiment. I am acutely aware that my amendment goes only to that preliminary matter and does not attempt to deal with the way in which the state's claim against the defendant is to be prosecuted. One reason why I have tabled only this amendment, and have not tried to follow it up with a mechanism by which the injured person could become the agent of the state in his own action, is that it is beyond my compass and powers to do it; it is a very difficult matter. Thus, the purpose of the amendment is simply to pave the way to a wider scheme which would transfer back to the state money which it spends on injured people to the benefit of the insurers of the tortfeasor.
Therefore, my amendment is simply intended to ventilate what I believe to be an important question, and, if possible, to ascertain the reactions of the noble and learned Lord to what I have had to say. I am also acutely aware of the fact that the amendment, as I have put it down, might not have given the noble and learned Lord any clear idea of what arguments I was going to advance this afternoon. I apologise for that, and I really ought, if I had had time, to have given the noble and learned Lord some indication of what was the purpose of the amendment. I hope that he will forgive me for that, and of course I undertake that if he is able to express any sympathy at all for the arguments that I have been advancing, I would, before the next stage of the Bill, endeavour to try to put my proposition into a more coherent and adequate form. I beg to move.
The Lord Chancellor: I am very grateful to the noble Lord for his speech. He need not at all have apologised for not giving me prior indication, because during the course of his speech he very clearly stated that he was ventilating a point. I am sure that noble Lords who have had the benefit of listening to his speech will thank him for having ventilated it, since it is an interesting and important point.
Of course it is quite true that where there is a welfare state providing a free health service and other benefits, and a person who is injured receives treatment under the scheme and does not have to pay for it, to a greater or lesser extent, according to what arrangements are made, the tortfeasor—that is to say, the defendant in the personal injuries litigation—will be

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the gainer and not the victim. On the other hand, as the noble Lord, Lord Foot, quite rightly says, in an ideal world (if there is, or could be, such a thing) the Revenue ought to be the gainer by virtue of some mechanism whereby there could be a clawback from the tortfeasor of money spent on the victim. I have every sympathy with that thought.
But I must now do what the noble Lord has asked me to do; namely, to express what at the moment is the view of my advisers as to the two amendments, which I still think are interlocked, both dealing with the same problem, which is a real problem. I am very grateful to the noble Lord for having raised it, and I am sure that if he ever gets wind of this, my right honourable friend the Chancellor of the Exchequer will be filled with enthusiasm for the noble Lord, Lord Foot.
The object is to achieve some formula by way of a clawback. The first amendment (the one moved) empowers the Lord Chancellor to fix sums or formulae by which a saving can be calculated instead of, or in addition to, the present draft of the Bill, which provides that any saving shall be taken into account in assessing damages against the tortfeasor.
The object of the exercise is to enable the relevant body to claw back its expenses from the tortfeasor probably by means of subrogation. As it at present stands, the amendment is defective for two reasons. First, no system of subrogation or clawback is provided for in the amendment, and none at present exists. Secondly, the clause as it stands, unaltered by the amendment, provides for the saving to be taken into account—the new clause covers the total costs. The formula would not then be appropriate, so I am advised, since it would relate to the wrong amount.
Having said that, I shall now consider the meat behind the amendment. The first amendment—the one that imposes on me an obligation to devise a formula—would remove from the judiciary (that is, the courts) the necessity of inquiring what saving the injured person has actually made by virtue of his being maintained in hospital. Since every case, and every saving, is different, the formulae would have to be very complex in order to cover every case. I am advised—again this is a matter for which I have relied somewhat upon advice rather than one on which I will express my opinion, which is probably not as valuable as that of the noble Lord, Lord Foot, which is much more up-to-date than is mine in regard to accident cases—that it is likely that as much, if not more, judicial time and effort would be spent in argument over, and application of, the right formula as would be spent in argument over the amount of any actual saving without using any formula at all. Just as the amount of a dependency claim in a Fatal Accidents Act case may be calculated without reference to a formula, so may the saving.
The administrative costs, so I am advised—and here again I am moving well outside the field in which I am entitled to step with confidence—of any clawback scheme would be huge and would probably outweigh any repayment that the relevant public authorities would receive. The recent White Paper on the reform of the industrial injuries scheme, issued by the Department of Health and Social Security, proposes, for
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consultation purposes, the complete offsetting of social security benefits from tort damages. That was a recommendation of the Pearson Commission. However, at the moment the Government are not pursuing the possibility of recovering the amounts which have been paid out.
Major difficulties, so I am advised, would arise in working out what was and was not part of the costs of medical attention, and I am told that the formula proposed is apt to cover only the saving to the injured person, and not the total cost to the relevant public body. It should be noted that neither Pearson nor the Law Commission commented at any length on a system of subrogation, except to say that the purpose of damages was to compensate the victim and not to punish the tortfeasor, with which view I suppose we would both agree. It is to be noted that the Law Commission did not recommend any change in the analogous rule in Gourley's, case which as the noble Lord, Lord Foot, knows, is about damages being net of income tax.
Obviously this is not a matter upon which I can speak with authority. If the noble Lord, Lord Foot, will withdraw the first of the two amendments and not move the other one, I shall take advice on the matter and write to him, or he can return to it on Report. I will try to be both a little more informative and knowledgeable than I have been so far.
Lord Foot: I am very much obliged for that reply. I never intended to press the amendments. There is I think one small point of misunderstanding in that there is no real relationship between the first amendment and the second amendment. The first amendment is designed simply to clarify the existing law, inviting the noble and learned Lord as Lord Chancellor to produce a formula for calculating the maintenance provided to the injured person by the state.
My second proposal is quite different. I entirely understand that the amounts which would become payable under my second amendment are quite different from the amounts which would be assessed under the first amendment. I entirely accept, of course, what the noble and learned Lord says about the difficulty of preparing a formula, and I do not care a bit if the first amendment is never heard of again. As regards the second amendment, I would make only one observation on what the noble and learned Lord has said about the advice he had received about the administrative cost of clawing back the money which is paid out by the state for the benefit of an injured person.
That is, of course, I understand, a formidable problem, and that is why those people advising me came down, among the various alternatives that you might adopt, in favour of the scheme that I was proposing and which I was trying to explain in broad outline; that is that the claimant in any action, or indeed possibly a person putting forward a claim short of an action, should be able to include in his claim on behalf of the state, by a process of subrogation, the amount of money which is due to the state. If that could be done, then I suggest that the administrative costs of this would not be so enormous, because the administrative job of collecting the money would not fall in the first place upon the hospital or the service or whatever it may

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be: it would fall upon the claimant in the action and all he would have to do is to notify the hospital concerned that he was bringing the action, invite them to tell him how much they had expended for his benefit (which is a very simple matter, I should have thought) and then proceed with his claim in the court; and the DHSS, the doctor, the hospital or whoever it might be would have to play no further part.
I hope the noble and learned Lord will be able to consider with his advisers whether that system, if it could be established, would in fact not involve the very heavy expenditure which he foresees. With that, may I seek the leave of the Committee to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 5 agreed to.
[Amendment No. 12 not moved.]
Clause 6 [Award of provisional damages]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 13:
Page 6, leave out line 40.
The noble and learned Lord said: In moving Amendment No. 13 perhaps I may speak also to Amendment No. 79, which is consequential on it. They are drafting amendments. Of the two here the second relates to Northern Ireland, and the reason I am deleting the provisions, which is the purpose of the amendment, is that they are said technically to be unnecessary. I beg to move.
On Question, amendment agreed to.
Clause 6, as amended, agreed to.
5.44 p.m.
Lord Mishcon Lord Mishcon moved Amendment No. 14:
After Clause 6, insert the following new clause:
(".Motor accidents
—(1) Where after the commencement of this section the death of or bodily injury to any person is caused by or arises ouy of the use of a motor vehicle on a road in Great Britain and ant of the circumstances specified in subsection (2) of this section applies, the death or injuury shall be deemed (subject to subsection (3) of this section) to be attributable to negligence on the part of the driver of the vehicle (whether or not he is liable in respect of the death or injury apart from this subsection), but without prejudice to the law relating to contributory negligence and to any remedy by way of contribution or contract or otherwise which is available to the driver in respect of the death or injury.
(2) The specified circumstances are where the death or injury arises out of—

(a) any impairment of the driver's physical or mental condition, whatever the cause; or

(b) any latent defect in the vehicle not discoverable by the exercise of reasonable care; or

(c)any natural occurrence amounting in law to an act of God.

(3) Where the circumstances specified in subsection (2)(b) of this section apply and the driver of the vehicle is not its owner but is permitted by the owner to drive the vehicle at the material time, subsection (1) of this section shall have effect as if there were substituted for each reference to the driver of the vehicle a reference to its owner.
(4) This section shall have no effect in criminal proceedings.").
The noble Lord said: I hope to be brief on this amendment. If any of your Lordships happened on some miserable occasion to find yourselves on the pavement and as a result of a motorist having a heart
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attack, of lightning striking a car or of there being a latent defect in the car of which, with reasonable care, the driver could not have known, the person I have selected from your Lordships unfortunately being on that pavement was hit by that car, that person would have no right of recovery because nobody would have been negligent. There is no doubt about it; Pearson considered this case of the latent defect or the act of God, and because of the main recommendation of the Pearson Commission that there should be a no-fault liability combined with tort, there was no point in Pearson making a recommendation in regard to this class of case.
So if I may get to the heart of the amendment immediately, it is this. We are dealing now in this Bill with matters which relate to accidents and injuries from accidents. This may be the opportunity, which may not recur for a very considerable time, to do something about relieving the class of person injured to whom I have just referred; and your Lordships may think that the best way of dealing with it is by saying that there is an imputation of civil negligence which will enable recovery to take place. No criminal negligence follows from this, no criminal liability follows from this, but there is imputed negligence. Contributory negligence and other matters of contract will not in any way be divorced from this principle, so that they can all of them apply. As I said, this may be an occasion, your Lordships may think, for dealing with an aspect of the law which involves, of course, grave injustice where the recipient of the injury is in the position I have outlined. I beg to move.
Lord Renton: I hope my noble and learned friends will go very carefully on this matter because it seems to me that the noble Lord, Lord Mishcon, has suggested that there should be an irrebuttable presumption of negligence in the circumstances described in subsection (2). If we look at those circumstances we find that they are really drawn rather widely. It says:
"any impairment of the driver's physical or mental condition".
Whether permanent or temporary, are we to assume? Then:
"any latent defect in the vehicle not discoverable by the exercise of reasonable care".
This, of course, gives rise to the question of causation. There are some defects which could be alleged to be the cause of an accident, but there might be a dispute about that, also.
I think we need to be very careful indeed before we give rise to anything approaching a fresh irrebuttable presumption in the law of negligence, and more especially so in these particular circumstances. Therefore, with respect, I would not be inclined to support this new clause.
Lord Simon of Glaisdale: May I reinforce the plea for caution made by the noble Lord, Lord Renton? The words "arising out of" obviously fall far short of causation; and the words
"any impairment of the driver's physical or mental condition, whatever the cause".
mean, as the noble Lord, Lord Mishcon, made quite plain, that this is a step towards compensation without liability. Compensation without liability—the Pearson

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proposal—is one thing: this is quite another. This is half-way there. But it still means that the person who has not been negligent, whose negligence has not caused the accident, but who has had some impairment out of which it can be said, in a vague way, the death or injury arose, shall be deemed to be negligent. As a result of his being deemed to be negligent he may lose, without any fault on his part, at least a no-claims bonus, even if his insurance company comes to his rescue, as presumably it will. Therefore, it seems to me that there are two courses, either the Pearson proposal or the present law; but this half-way step is a step which simply is liable to lead to injustice.
The Lord Chancellor: It is my opinion—and I have a good deal of sympathy with some of the thinking behind this—rather for the reasons which have been put forward by my noble and learned friend on the Cross-Benches and my noble friend Lord Renton, that this appears to fall firmly between two stools. When I proposed, as I did, the Pearson Commission being set up, I was very much aware that people got injured through no fault of their own but simply from the presence of motor vehicles on the roads; and the same, I thought, could be applied to some injuries at work where there was no negligence or breach of statutory duty on the part of the employer. I understood perfectly the case for saying in such circumstances that the duty of the motor vehicle owner might be turned into an absolute duty of buying an insurance from Lloyds or someone else and compensating the victim. I was aware equally of what I might call the Massachusetts scheme—and I need not enter into the reasons why I call it so—that is to say, the courts will continue to operate compensation or damages and that the liability for the use of the motor-car on the road should be absolute.
I was aware also of the New Zealand scheme, very much favoured by the Chief Justice of New Zealand at that time, and broadly speaking the Pearson Commission came down in favour of the New Zealand scheme. Whether either of them was right or wrong is not for me to say at this time because the Government have found difficulty in imposing a no-fault liability scheme. This is a very odd provision which does not conform either to the Massachusetts formula, although it shares with the Massachusetts formula the idea that in practice the insurer should be made to pay, although it does not say so; and therefore I suppose it would be met by the motorists out of their insurance premiums. It did not conform at all to the New Zealand type scheme which depends largely on public funds for supplying a new social service in place of the system of tort altogether.
What it does is not acceptable for the reasons that I have tried to explain. It imputes negligence when there is none in a certain number of limited circumstances which are specified in the clause and which are limited to accidents on the road. It imputes negligence to the driver of the vehicle where he is not the same person as the owner and he is driving without the consent of the owner, and on the owner of the vehicle but not the driver when the driver, not being the same person, is driving with the owner's consent. It applies only to accidents which are caused on the road by
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reason of the driver's physical or mental condition or of any impairment of his physical or mental condition which gives rise to the problems of the kind spoken about by my noble and learned friend on the Cross-Benches; of any latent defect in a vehicle not discoverable by the exercise of due care, which has approximately the same or analogous difficulties; and to any natural occurrence amounting in law to an act of God, such as when a motor-car is struck by lightning.
If I were going down that road, I would not limit the case at all. I would not do it by a deeming provision, deeming negligence without there being negligence. I would go down the Massachusetts road; and that would be a big change from the present tort system. This purely artificial method is not one that I could recommend to the Committee. One would only have to see that anomalies would arise and they would be in conflict with the rest of the tort system. For example, a person injured when the other driver had a heart attack at the wheel of his car would be able to recover but where the accident was not caused by the specified circumstances and the plaintiff could not prove negligence he could not recover anything.
The proposed amendment would help some people in some circumstances, but in practice it would be subjected to devastating criticism by those who found that the same injuries which they had suffered fell outside the scope of the clause. I think it is inevitable, and it may be regrettable, that modifications of the fault system in order to do greater justice to particular classes of victim run into this kind of trouble. It is possible that one can either have a fault-based system or one which involves strict liability; but it would be rash, I submit, to embark on an incursion into the law of negligence on the lines suggested in the amendment without thinking through these difficulties and consulting all those involved as to how such a scheme could operate in practice. I would rather go forward on a Massachusetts-based scheme if I was going to stick to tort or quasi-tort and go down the New Zealand road if people decided to implement the Pearson Commission. But this falls firmly, squarely and irreparably between two stools.
5.56 p.m.
Lord Elystan-Morgan: The amendment as drafted by my noble friend Lord Mishcon and my noble and learned friend Lord Elwyn-Jones is far from perfect. That is accepted. The principle, however, is one of considerable significance. Your Lordships have already been told that, after all, in Committee it is possible to give further thought to the technical forms of amendments and to deal with them later at Report. I accept that the amendment is defective in that it does not make it clear that the presumption that it gives rise to is a rebuttable presumption. A presumption which can be rebutted by evidence which at the end of the day establishes on a fair balance of probability or better that the defendant was in no way causative of the accident, would lead to the success of the defendant.
As the Committee heard in the valuable and interesting discussion that occurred on a Motion on 20th January this year, this proposal has distinguished antecedents. It finds its origin in a Bill proposed in

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this House as long ago as 1932 by Lord Danesfort. It is a Bill that was supported by the Government of the day and the reason for supporting the Bill in 1932 was that it was considered that the roads at that time were so dangerous that anybody who took out a vehicle on the roads was adding immeasurably but nevertheless in some slight real degree to the potential danger that existed and, therefore, it was right that a responsibility by way of switching the burden of proof should be placed on the shoulders of a person so involved.
If there was justification 50 years ago, as I am certain there was, for such a viewpoint, how much greater justification is there today with the congestion brought about by, I believe, 16 million vehicles on our roads? The noble and learned Lord the Lord Chancellor makes the fair point that it is something that the Committee should consider and ponder upon before placing responsibility in tort upon a person who may be totally blameless. I accept that, but after all, it is a case, very often, of choosing between two persons each of whom is totally blameless.
Indeed, there are plenty of precedents in law where society takes the view that an act is of such public consequence that very heavy responsibility has to be placed on the person who indulges in that act. Even criminal responsibility is sometimes placed upon such a person. The food and drug Acts are probably the very best examples of that principle. Therefore, though on the face of it it seems unjust, if one looks at the situation through the eyes of the totally innocent victim, then I think that there is a very great deal to be said for it.
The ultimate financial responsibility falls not upon individuals but upon insurance companies or upon the MIB. Ultimately it would mean that the higher cost of premiums would be borne by the motoring public as a whole. That, in my submission, is no less than just. Pearson rejected this but in so doing it made it clear that its main reason—it may well be its central reason—was that it would fly in the face of its own philosophy in relation to no-blame compensation.
If the noble and learned Lord the Lord Chancellor with his hand on his heart can say, "Well, the Massachusetts road is still open"; it is still a possible development for Her Majesty's Government to say in relation to Pearson that it will bring forward legislation to create a no-blame scheme and then quite clearly there would be little to be said for this proposal. If, on the other hand, the noble and learned Lord says: "No, it is now four years since Pearson reported. Full and mature thought has been given to this matter and the Government most certainly will not take the Massachusetts road", then, in my submission, this is a just, proper and practical alternative.
Lord Simon of Glaisdale: I should like to ask the noble Lord, Lord Elystan-Morgan, what he meant by saying that the real intention of this amendment was to create a rebuttable presumption. Surely, the only presumption is the presumption in subsection (1), the deeming, and if that is rebuttable it surely—does it not?—makes nonsense of that subsection. In subsection (2) there is no presumption, no deeming. It says that the circumstances which give rise to the
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deeming of negligence are when the accident arises out of some impairment, et cetera.
Lord Mishcon: My noble friend, Lord Elystan-Morgan, is always very generous in his attributions and he was kind enough to attribute to my noble and learned friend Lord Elwyn-Jones and to myself this piece of beautiful English handiwork, the drafting of this amendment. I want to make it perfectly clear—because it would he quite dishonest of me to claim authorship of it, and I know that I speak for my noble and learned friend Lord Elwyn-Jones—that this comes from a very reputable source indeed, and a very learned source, but not as learned as my noble and learned friend and certainly, as I said, I cannot worthily claim authorship of it.
Having said that, I want to say something very briefly. I would love to have been geographically ambitious and gone either to Massachusetts or New Zealand. I tried hard to preserve some of Pearson or to do something in regard to this part of the law which obviously needs some attention paid to it. The noble and learned Lord the Lord Chancellor recognised that. I hope that possibly between now and Report stage something can be done, as I said, about this class of case so that we do at least have one wee little bit of "Pearson thought" to illuminate our thinking on personal accidents and injuries and the liability in this class of case. With that hope in mind—slightly despairing but nevertheless with that hope still within my breast—I think that it is appropriate for me to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.5 p.m.
Lord Stanley of Alderley Lord Stanley of Alderley moved Amendment No. 15:
After Clause 6, insert the following new clause:
("Duty of occupier of premises to univited entrant.
Liability for damages in respect of death
or personal injury
.—(1) An occupier of premises owes a duty to an univited entrant upon the premises in respect of a danger if, but only if, the danger is one against which, in all the circumstances of the case, the occupier can reasonably be expected to offer him some protection.
(2) The duty owed by an occupier in accordance with subsection (1) above is a duty to take such care as is reasonable in all the circumstances of the case to see that the entrant does not suffer personal injury or death by reason of the danger.
(3) In the case of any entrant as aforesaid who commits a criminal offence, or purposes to do so, on the premises, the duty owed to such an entrant by the occupier shall be no more than to avoid deliberately imperilling the entrant by any covert device.").
The noble Lord said: My new clause, except for the subsection (3) was drafted by the Law Commission and recommended for enactment by the Pearson Royal Commission on Civil Liability and Compensation for Personal Injury. I am therefore happy about its drafting and its pedigree and indeed it being a suitable amendment for this Bill as I believe it fits neatly into the second, third and fourth lines of the Long Title.
This amendment refers to the liability of occupiers of land to those who trespass on the land. At the moment, the law is in confusion since the case of British Railways Board v. Herrington in 1972. To remind the Committee—although I am sure I do not have to do so—this case involved a child deliberately

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trespassing on a railway line, and then the railway being found to blame. Such of course poses questions as to whether a trespasser, with intent to burgle, who borrows the farmer's ladder which then breaks could sue the occupier? Maybe not, but I am somewhat worried. It would be a strange situation if that were so, and I am sure the Committee could think of similar ones.
Surely the problem of the case of British Railways Board v. Herrington may have prompted the noble and learned Lord the Lord Chancellor in 1972 to ask the Law Commission to examine this problem. The Law Commission did this and they published a draft Bill in 1976. Nothing has germinated, hence my amendment. I hope that the Government will now take some action to redress the balance between the occupier and the trespasser—particularly the trespasser with intent to commit a crime—by accepting this amendment. I beg to move.
Baroness Sharples: I have put my name to this amendment because I am worried. As a landowner, I accept that I have a responsibility to ensure that there is no reasonable likelihood of injury to a possible trespasser who comes on my land. I also acknowledge that I have a duty of care towards uninvited entrants. Given the present situation, as a direct result of the case of British Railways Board v. Herrington in 1972, I fear that we will err on the side of caution and be inclined to deny access to everyone on our land. I feel that the law is not clear enough as to our liability for accidents, and certainly my insurer feels the same. I seek clarification of my position as a landowner and farmer under the present law. I should be most grateful for assistance on this matter.
Lord Monk Bretton: In putting my name to this amendment, I should like to say that the amendment does not seek to return to the status quo before the case of British Railways Board v. Herrington—that is, back to the Occupiers' Liability Act 1957 alone under which there was no protection for trespassers. Neither is it intended to allow occupiers to opt out of their responsibilities. What it is intended to do is to attempt certain clarifications arising after the British Railways Board v. Herrington case and to alter the balance only slightly between the occupier and the trespasser.
No doubt the Committee is aware of the problems that occur in rural areas where, once the factory floor has become the farm with all the space involved, a number of problems arise, particularly the fact that trespass is more common. Advisers to the farming industry have their doubts about the situation and they say it is no longer clear when an occupier is responsible for injuries suffered by trespassers. The occupier could even be responsible in the case of a trespasser with criminal intent. That really sums up the reason for putting down this amendment. If the amendment does not appeal to my noble and learned friend—though I earnestly hope it will—he will nevertheless doubtless be aware of the problems and anxieties of farmers. I hope he will be able to say what progress there has been in refurbishing those proposals made in 1976.
The Lord Chancellor: I do not want to turn a deaf ear to my noble friends who have put forward this amendment, which deals with a very real problem; but I must tell them honestly that I could not allow this amendment in this Bill. For reasons which I explained very fully on Second Reading, this is a Bill designed to improve the administration of justice in a number of non-controversial and, to my mind, absolutely essential but relatively minor areas. I got a place for it on the Government programme, on the basis that the Opposition would agree—which they very kindly did—to Second Reading proceeding in another place. I do not believe that I could "deliver the bacon" if I were to go very far along the lines of using this Bill as a vehicle for this particular type of amendment.
What I say now applies to the sequence of amendments now to be put forward. This one is concerned with introducing a limited duty towards uninvited entrants—a polite way of describing what I previously knew as "trespassers"—coupled with a very low duty of care towards entrants who commit or intend to commit criminal offences on the premises. The second and third new clauses limit the application of the Unfair Contract Terms Act 1977 and the Health and Safety at Work Act 1974 with regard to those who go on to land for recreational purposes. I know they have the support of a number of very influential bodies. I believe the Country Landowners' Association support them, together with the National Farmers' Union and the Central Council for Physical Recreation; so there must be a good deal to be said for them. Their common interest is the difficulty, which is a real one, of allowing free and easy access to country land for recreational purposes without increasing the risk of liability borne by the occupiers of such land—
Lord Stanley of Alderley: I am sorry to interrupt my noble and learned friend—indeed I am fearful of doing so—but he has now gone on to my next two amendments and I was going to say something about them separately because they involve a slightly different problem from trespass.
The Lord Chancellor: I fully agree about that, but I thought it might be for the convenience of my noble friends and of the Committee, since I am told that we are likely to resume the House before the next two amendments are called. If that should be the case, I think I am rendering a service to my noble friend; I am trying to tell him what the attitude is likely to be, though I agree with him that in strict logic I should confine myself to the question of trespassers. But I think that what I have said so far is applicable to the trespassers because I have correctly described the scope of the present amendment. The bodies I have mentioned have been pressing for some time for changes in the law to clarify the liability owed by landowners towards trespassers and to reduce the liability owed by such landowners to visitors who come on to the land for recreational purposes.
I have a certain filial interest in this. One of the things that my father did when he was Lord Chancellor was to preside in a case called Addle v. Dumbreck—and I can see that the noble and learned Lord, Lord Gardiner, recognises that case at once. My father

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was under the impression that this was the final word on the liability owed to trespassers by the occupiers of land. Most unfortunately, it failed to achieve that universal approbation which he had confidently expected would follow his efforts. His son is fully aware of the dangers of thinking that he has made a definitive improvement to the law of the land when he presides at the Appellate Committee! At any rate, the common law position is now not as stated in Addle v. Dumbreck, as my father fondly believed it would be, but as in the case of the British Railways Board v. Herrington. The case does not formulate one clear principle with regard to the liability owed by trespassers, and the Law Commission were asked to consider this area of the law in 1972. A report was published in 1976 and between then and 1978 various attempts were made—successive and numerous attempts—to introduce an occupier's liability Bill dealing with trespassers, based on recommendations made by the Law Commission. Unfortunately they all foundered, principally because the country landowners' lobby—I hope they will not mind my referring to them like that—did not favour the Bill which was proposed. It has since become clear that the country lobby does not like Herrington and they would rather see something along the lines of the Law Commission's recommendations, coupled with an exclusion of liability to the criminal trespasser, then leave things as they are.
In addition, there have been suggestions made by the users of the countryside that the Health and Safety at Work Act 1974 and the Unfair Contract Terms Act 1977 prevent free and easy access to the countryside for leisure purposes, because landowners are now unable to restrict their liability for injuries suffered by people who come on to their land; and that is the rationale of the amendments to which we have not yet come.
Although there is considerable pressure for change in this area of the law, I am bound to tell my noble friends that it would be premature to introduce changes into this Bill. Discussions have been continuing for some months on the question of the extent to which the present law on occupier's liability is restricting access to the countryside. As a result of these discussions, a consultation on the main problems and changes which have been suggested has been undertaken and is still in progress with other departments and a large number of other interested outside bodies, including the Bar, the Law Society, consumer associations and various local authority bodies, which are all closely interested in the result. It would not be right to move prematurely into making changes in this Bill before that consultation has been completed.
The implications of the changes which have been suggested have not yet been thoroughly thought out, and it is possible that they might have consequences not only for countryside use but for the use of urban property as well. The new clauses are not restricted in any way to countryside and would quite clearly extend to urban property. The suggestion that liability for personal injuries suffered by users of the countryside might be restricted by the use of exclusion clauses would be a major departure from the principle established in the Unfair Contract Terms Act 1977, and to restrict liability under the Health and Safety at Work
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Act 1974 would be a major departure from the principle of that Act.
Although the response to the consultation paper has so far been slow, it is at any rate suspected that the suggestions for change put forward in the second and third of the amendments would be controversial, and the possibility that any changes would apply to all property, urban as well as rural, is one that is likely—indeed almost certain—to be resisted by the consumer organisations. My view, on which I have taken advice, is that it would be wrong to introduce changes into the law before the consultation has been completed and full and thorough consideration has been given to its results. There must be consultation in these matters. One of my noble friends behind—I am sorry I cannot be quite certain which—asked me how far the consultations had gone. I will write to him with an accurate description of the position. They are not complete.
I would ask my noble friend, therefore, to withdraw this amendment. We are not blind to the genuine problems involved and to the importance of the interests which promote them. But we are not in a position to use this Bill as a vehicle for them. I hope that with that explanation, which is not intended to be wholly unfavourable, he will find it possible to withdraw this amendment and—I tell him this, because I know that there is to be an early resumption of the House, and I do not think we are likely to reach the next two amendments this afternoon—I hope he will consider that, to this extent, this is a fairly clear prognosis of the kind of answer he is likely to get on those two as well. But, on this one, which is the best of the three from his point of view, I am not yet ready to accept it into this Bill. However, we recognise the importance of the question which he has raised and look at it not unsympathetically.
Lord Stanley of Alderley: I knew that my noble and learned friend would get me in a muddle and, of course, he has. I would start by saying that he trespassed very strongly on my next two amendments, and, if he is going to do that, I do not see why I should not trespass on them, too, which is what I think he wants me to do. We moved on to what I call my Access to the Countryside Bill which he answered, but I do not think he really answered at all satisfactorily.
First, I do not see why I cannot move this amendment, when the Long Title to the Bill states in the second and third lines that it is,
"to amend the law relating to actions for damages for personal injuries, including injuries resulting in death".
This is what we are worried about when people come on to our farms. The point here is that the Government had a conference in June 1981 to decide what should happen and it is now nearly April 1982. I know that the law moves very slowly, and perhaps it is a very good thing that it should. But I should like to draw my noble and learned friend away from his law points, of which I understand not one word, and on to the actual practicalities.
The Government had a conference and a meeting between the parties and they all agreed. If there is one thing that is enormously precious in this life, it is getting two or three people to agree. It is extremely difficult to do that. When you get them to agree, I

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suggest that the answer is to move forward very rapidly, but that is what the Government have not done. My noble and learned friend mentioned lots of other organisations, such as the Consumers' Association, and I thought at one moment he was going to mention the PLO. But they are not involved in this discussion.
I should like a firm assurance from my noble and learned friend that we will have a little more progress, because, as I understand it, the law is there to serve me. I am not there to serve the law. Here we are trying to open the countryside to the people, but, in fact, we are baulked, and I do not believe that that is the Government's intention. I believe that it is the Government's intention to help us open our farms to the public. But I think my noble and learned friend accepted that there are worries over the 1977 Act, tied up with the 1957 Act. It was the 1977 Act which messed up the 1957 Act and, therefore, I should have thought that this Bill, which is a tidying up measure, might tidy up the mess which the 1977 Act made of the 1957 Act.
I could go on and read the speech that I was going to make on the other two amendments, but I have covered most of the points. But there are various issues. First, it is surely very important to differentiate between my obligation as an employer to my employees, and my obligation to the public whom I have invited or have let come on to my farm, with no charge. At the moment, as the law is written, the obligation is absolutely the same. I want to make it clear that I do not want to get out of my common law liability to these people. I just do not want—to use an agricultural term, as my noble and learned friend uses legal terms—to be leant on by the law, which is the position at the moment, and I do not believe that my noble and learned friend wants that either. I implore him now to get these consultations going and to try to keep this matter moving forward. I should have liked to hear him say, but I do not think he will, that by the time the Bill reaches another place we might have made some progress.
The Lord Chancellor: I can say only what I believe to be true. I am in favour of the consultations going forward with all possible speed. I agree that the law is to serve the public and not the public to serve the law, but not entirely that one must press forward with every change which will, in fact, be controversial. I said on the Second Reading of this Bill that I could not take on board a great number of amendments to put into this Bill. I got it into the Government's programme after consultation with various interests in Parliament, in both Houses, and I must keep faith with them.
The only thing my noble friend will achieve by pressing this amendment is simply to lose the whole Bill. I cannot help that. I explained it from the start and I am bound, therefore, to keep this Bill within a reasonable compass. There are a number of amendments of various kinds coming from very different quarters of the House, with some of which I have very great sympathy. But I cannot add to the Bill, at the moment, amendments wholly altering the nature of occupiers' liability, especially as the amendments are not drawn to be limited to rural areas, but, so far as I can see, apply to urban areas as well.
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I do not think I am being unreasonable about this. I am willing to help my noble friend in every way I can, both on this amendment and on the two subsequent amendments. But I cannot necessarily agree that they should be embodied in this Bill, not because they are out of order—of course, they are within the Long Title and the scope of the Bill; it would be very difficult to devise an amendment which was not within the scope of the Bill—and I simply say to my noble friend, in all humility and in words which I hope he will not understand, that I an not leaning on him in the least. I am making a?cri de coeur to allow me to pass rather a harmless measure, although one of monstrous size, and to keep my promises, on the faith of which people have acted to my advantage and which I intend to keep to the best of my ability, cost what it may.
But I am not being unsympathetic to my noble friend. I sympathise with his point. I am anxious for these consultations to go forward. But I am sure that he would not get them through, riding on this particular bicycle. I will try to devise a vehicle for him, if one can be devised. I hope that it will have round wheels and not square wheels, and that it will go forward with acclamation and success. But this, I am afraid, I cannot promise on this occasion and in this context; otherwise, I would.
Lord Stanley of Alderley: With those very kind remarks of my noble and learned friend, of course I will withdraw this amendment. I am sure that if he keeps on pushing at the wheel, we shall one day get these minor adjustments to the law through in a satisfactory Bill. I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Lord Sandys: In view of the considerable length of the debates which are to follow, it might be for the convenience of your Lordships if the House were resumed at this stage. I beg to move that the House do now resume.
Moved, That the House do now resume.—(Lord Sandys.)
Lord Elwyn-Jones: Before the Question is put, may I, on behalf of noble Lords who have taken part in the proceedings since three o'clock, express our gratitude to the noble and learned Lord the Lord Chancellor, who has batted single-handed on most of these matters for over three-and-a-half hours.
The Lord Chancellor: I am very grateful indeed to the noble and learned Lord, who is always more kind to me than I deserve.
House resumed.

Wool Textile Industry (Scientific Research Levy) (Amendment) Order 1982
6.30 p.m.
Lord Cullen of Ashbourne: My Lords, I beg to move that the draft Wool Textile Industry (Scientific Research Levy) (Amendment) Order 1982, which was laid before this House on 2nd March, be approved,

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and, with your Lordships' permission, I will speak also to the draft Wool Textile Industry (Export Promotion Levy) (Amendment) Order 1982 which was laid before this House on 2nd March.
The two orders are closely connected and they can most conveniently be dealt with together. I should explain that it is necessary for there to be two separate orders, although they are closely connected, since the purpose of the two levies is different. One levy is for scientific research into the technical problems of the industry, carried out by WIRA (formerly the Wool Industry Research Association) and the other for the promotion of exports of woollen goods effected by the National Wool Textile Export Corporation, known as NWTEC.
The effect of these orders, which are under the authority of the Industrial Organisation and Development Act 1947, is to provide for the amendment, first, of Statutory Instrument 1970/349 (the Wool Textile Industry (Scientific Research Levy) Order 1970), as amended by Statutory Instrument 1971/881 (the Wool Textile Industry (Scientific Research Levy) Amendment Order 1971); and, second, of Statutory Instrument 1970/348 (the Wool Textile Industry (Export Promotion Levy) Order 1970), as amended by Statutory Instrument 1971/880 (the Wool Textile Industry (Export Promotion Levy) (Amendment) Order 1971). The changes proposed in the orders are twofold. Perhaps the most significant one is that the scientific research levy shall cease to be payable in the wool textile industry after the levy period ending on 31st March 1983. The other is that the orders provide that the level of exemption from liability to pay the two levies (that is, for scientific research and export promotion) will be increased with effect from the current levy period ending on 31st March 1982.
It may be helpful if I explain at this point a little of the background to these statutory levies which were established in 1950. The scientific research levy was introduced to provide funds for scientific research carried out by WIRA. These funds replaced grant hitherto paid by central Government in one form or another since 1918. The export promotion levy was introduced to provide funds for the work of the National Wool Textile Export Corporation which had been financed since 1941 by the Board of Trade. The objective of the levies was to spread the cost of research and export promotion aimed at benefiting the industry as a whole on as equitable a basis as possible to all firms within the industry. The proceeds of these levies are paid over, without deduction, to the two organisations concerned.
As part of a general review of statutory levies in industry, the Department of Industry conducted a poll last year of companies which pay these wool textile industry statutory levies. The result of this poll showed that a significant majority of companies (58 per cent.) had voted for the termination of the scientific research levy and a small majority (51 per cent.) for the continuation of the export promotion levy. It is obviously right that the views expressed by a substantial majority of the industry should be respected. But having accepted the views of industry on the scientific research levy, we recognise the difficulties that would be created in discontinuing it overnight.
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We have taken the view therefore that a period of adjustment is desirable so that the industry and WIRA might consider possible alternative arrangements. In effect, the provisions of the draft order mean that the levy would be phased over a period of some two years after the poll was conducted.
It is certainly not the intention of either the industry or the Government that research carried out by WIRA on behalf of the industry as a whole should cease to exist but rather that, as a result of the draft order and a new system of funding to which it would inevitably give rise, WIRA should become more commercially orientated and responsive to the needs of the industry which it serves. I know that WIRA is confident about its own future in the post-levy period. Many firms have intimated that they would be prepared to contribute by voluntary subscription. It is my belief that a move from a statutory levy to voluntary support, combined with greater reliance on charges for specific services, represents the most effective way of securing this change in direction.
Let me now turn to the second aspect. As I have said, both orders contain provisions to assist at once the smaller firms in the industry by raising, with effect from 1st April 1982, the exemption level below which firms do not have to pay levy. Both levies are collected at the same time on one assessment form. The Department of Industry then divides the proceeds in the appropriate proportions between the two recipient bodies. The exemption limit for both levies is therefore the same. The levies are collected in arrears, the collection commencing on the 1st April 1982 relating to the levy period 1st October 1981 to 31st March 1982.
The present position is that companies are exempted from making payments where the assessed amount would be just under £5, or less, in any six-monthly levy period. The new orders would increase this exemption limit to just under £100 per levy period. At present, some 70 companies out of nearly 700 assessed for levy are exempted from payment. The proposed increase in the limits will exempt approximately 200 further companies. This is a very substantial increase and in suggesting it we have of course had to have regard to Section 9 of the 1947 Act which requires that the authority making the order shall satisfy themselves,
"that the incidence of the charges as between different classes of undertakings in the industry will be in accordance with a fair principle".
We are so satisfied for three reasons. First, these new exemptions will not increase the levy payable by those who remain liable. They will pay the same as before. Second, the new exemptions will not cause a significant loss of revenue to WIRA and the export corporation. The loss will be less than 4 per cent. of these bodies' levy income. Third, many of these smaller companies have in practice received little benefit from the activities which the levies finance.
At present the scientific research levy yields about £411,000 per year and represents about 27 per cent. of WIRA's total income. The remainder of their income is derived from contributions from the Department of Industry towards expenditure on approved Textile Research Council contracts, subscriptions, rent, royalties and the like. The export promotion levy

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yields about £365,000 per year, and represents over 85 per cent. of the export corporation's total income. It is estimated that under the proposals which we are now considering, WIRA's income will be reduced by some £11,700 and the export corporation's by about £10,400 in a full year, or less than 4 per cent. of the amount they receive from levies, though the precise amount is difficult to calculate with certainty because the levies are based by reference to levels of emoluments and weights of fibre supplied which will obviously vary from one year to another.
As is required by the 1947 Act, the department has consulted organisations representative of persons carrying on business and those employed in the industry. The industry's representative organisation, the Confederation of British Wool Textiles, support the changes proposed. The two unions consulted, namely the National Union of Dyers, Bleachers and Textile Workers and the General and Municipal Workers' Union, would prefer that both levies should continue. We have taken serious account of that view, from the organisations representing persons employed in the industry, but we have decided on balance that the scientific research levy should be phased out. The matter has been discussed also with WIRA and the National Wool Textile Export Corporation, which have accepted the proposed amendments to the orders which I am putting before the House, which are essentially based on the wishes of the industry. I therefore ask the House also to accept the wishes of the industry and to approve these orders. I beg to move.
Moved, That the draft order laid before the House on 2nd March be approved.—(LordCullen of Ashbourne).
6.40 p.m.
Lord Bishopston: My Lords, I am sure that we are all grateful to the noble Lord, Lord Cullen of Ash-bourne, for having explained these draft orders in the way he has. On a day when your Lordships' House has already undertaken the consideration of a great deal of business, and when much still remains to be done, there may be a temptation to let these orders go through "on the nod", but I rather feel that if the time was available this topic could be the subject of a major debate because it concerns the present and future position affecting the wool textile industry, which, as many noble Lords will know, has been greatly hit by circumstances to which in a moment I shall briefly make reference.
Although these orders are small and may appear to be insignificant, they are really of great importance to the wool textile industry generally and to certain parts of the United Kingdom in particular, in areas which have been badly hit by the recession and by Government policies. The substance of the Minister's introduction is to warn both us and the wool industry that the levy on the industry for scientific research and the promotion of exports is to be phased out. Another aspect to which the noble Lord has made reference is that each of the orders substantially raises the level (and I am now quoting from the Fifteenth Report from the Joint Committee on Statutory Instruments),
"below which firms in the wool textile industry are exempt from paying the research levy and the export promotion levy payable
1328
under 1970 Orders in that industry. The levels are, however, raised very dramatically: from £2,500 to £50,000…".
The noble Lord the Minister has made reference to that. I do not want to pursue the report's points about procedure, but it says:
"In this case the effect of the massive increases in the exemption limits proposed by the Order would be that some third of the firms in the industry would be exempt from the levy, as compared with the 10 per cent. of firms that are at present exempt. To raise the exemption limits to such an extent constitutes in the Committee's view an unusual use of the powers conferred by section 9.".
I do not wish to pursue that particular point of the Committee's report, but I want to draw attention to the very high increase in the exemption levels because they are very important.
In one case, as the Minister says, one levy is for scientific research into the technical problems of the industry by WIRA and the other is for the promotion of exports of woollen goods by the National Wool Textile Export Corporation. These levies have helped two aspects which are absolutely vital to the future of the wool textile industry, at a time when the industry has been very badly hit by economic problems and by the economic policies of Her Majesty's Government—especially by high interest rates and foreign competition. Indeed, over the past two years hundreds of wool mills have closed and thousands of jobs in the wool textile industry have been lost in parts of Yorkshire. The unions have been very concerned about these job losses and about future prospects, if this kind of policy continues to prevail. Surely there has never been a time when the industry needed more effective R and D in order to remain competitive in the face of strong challenges from abroad. Adequate investment is vital, but it must be based upon the findings of scientific research, on up-to-date techniques, and have scientific backing.
The other area of great importance is that of export promotion, which is so vital at the present time. The Government will realise that we have to be competitive with economically produced materials and textiles and also by export promotion. There have been reductions in overseas missions in recent years together with a reduction in trade fairs and market research. Although there has been a demand of the industry with both of these levies, without such a levy without co-ordinated research, and without strong export promotion (co-ordinated and not piecemeal, which will be the result of this policy) the wool textile industry will not be ready to face the challenges of the post recession period.
We find ourselves confronted by bad policies yet again. I am sure the industry must realise that, despite the problems, what is needed is centrally co-ordinated research. If this is going to be left to be done piecemeal by firms who are already exempted considerably by this order or, after the levies have been phased out, for firms to pursue their own research, if any at all, without the pressures and incentives of central co-ordination, this will make the industry far less competitive. Therefore, the future of our wool textile industry and the thousands of jobs concerned with it must depend upon more co-ordinated effort backed by Government resources instead of being left to market forces to the detriment of our industry and, surely, to the pleasure of our competitors abroad.

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This is a bad policy. It is too late for the Government to review their policy now, but, whatever takes its place, we should bear in mind the need for coordinated and effective research to help in our competitiveness in the future.
Lord Cullen of Ashbourne: My Lords, the noble Lord, Lord Bishopston, will be pleased to hear that WIRA itself is very happy with this new development and sees the co-ordination which the noble Lord talked about working very well on a voluntary basis, with firms being able to tailor their research even better under the new system to the requirements of their individual companies. The noble Lord referred to the rundown in the wool textile industry as a result of this Government's policy. The really great days of the wool textile industry peaked in the 1920s, and I am afraid that there has been a falling off in wool textiles ever since those days, with, admittedly, a considerable fall-off in the period of the recent recession.
On Question, Motion agreed to.

Wool Textile Industry (Export Promotion Levy) (Amendment) Order 1982
6.47 p.m.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne rose to move, That the draft order laid before the House on 2nd March be approved.
Lord Cullen of Ashbourne: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
On Question, Motion agreed to.

Social Security (Class 1 Contributions—Contracted-out Percentages) Order 1982
6.48 p.m.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne rose to move, That the draft order laid before the House on 3rd March be approved.
The noble Lord said: My Lords, with your Lordships' agreement, for the convenience of the House I propose to deal in my opening remarks with the draft order to which I have just referred and with the draft regulations which appear next on the Order Paper.
The background to these two statutory instruments is technically complex, as can be judged from the reports by my right honourable friend the Secretary of State for Social Services and the Government Actuary. However, I shall do my best to avoid burdening your Lordships with too many technicalities and concentrate so far as possible on the social and policy issues.
My right honourable friend the Secretary of State for Social Services has a statutory duty to review at least every five years the terms under which good occupational pension schemes can be used to contract employees out of the earnings-related tier of the state retirement pension arrangements. In this the
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first review, we are making the minimum number of changes consistent with fairness to all parties; for we are but four years into the 20-year maturity of a new scheme. Before describing the changes we propose from April 1983, I should like to remind the House of the recent background to, and the structure of, the current atrangements.
Under the provisions of the 1975 Pensions Acts, a substantial earnings-related pension will become available as the new state scheme matures. This pension is in addition to the flat rate retirement pension. So that these state scheme arrangements could dovetail with the provisions of existing occupational pension schemes, the Act provides that members of occupational schemes may, on strict conditions, be contracted-out of the earnings-related element of the state scheme. The essence of contracting-out is that occupational schemes guarantee to provide a pension broadly equivalent to the state additional pension. To finance this commitment, national insurance contributions for contracted-out employments are reduced.
Originally, the Government of the day had it in mind to reduce national insurance contributions by a total of 6½ per cent., but in fact settled for 7 per cent., so that a reasonable contingency margin was allowed. This concession was particularly helpful to schemes with above-average concentrations of female or elderly employees (for whom it is more costly to provide pensions), but it was intended also to allay anxieties about the viability of contracting-out in uncertain economic conditions. Other important safeguards were introduced to apply when schemes had to buy back into the state scheme.
There can he no doubt that these contracting-out arrangements, which took effect in April 1978, have been a considerable success. Of the 11·6 million current members of occupational schemes in 1979, some 10·3 million were contracted-out. Occupational schemes have investments whose current value probably exceeds £75 billion. Much of this investment is in British industry. Given these statistics, I am sure your Lordships will readily appreciate that one of the Government's primary objectives is to maintain the stability of these arrangements so far as is practicable.
I turn now to the revision of the contracted-out contribution reduction that is the subject of the draft order. When the DHSS consulted the interested parties in August last year, it issued a technical analysis prepared by the Government Actuary. His analysis showed that a contribution reduction of only 6 per cent., a full 1 per cent. below the current 7 per cent. reduction, could be justified but that a financially neutral option would be an abatement of ¾ per cent. to 6¼ per cent. We chose this option because the ¾ per cent. abatement could be justified purely in terms of the reduced costs of covering contracted-out commitments—½per cent. because, as the average age in contracted-out schemes reduces, a reduced level of funding is required; ¼ per cent. because actual age and sex distribution data could be substituted for earlier estimates.
But there are other important considerations which justify our decision to opt for 6¼ per cent. We believe that to have taken a harder line could have riskezd a movement away from contracting-out. This could have disturbed investment markets and jeopardised the

1331
pension expectations of the scheme members concerned. On the other hand, to have opted for a lesser abatement would have improved the terms for contracting-out to the disadvantage of full-rate national insurance contributions—that is, those not members of contracted-out schemes. Finally 6¼ per cent. is in our judgement an admirable compromise which strikes a fair balance between those like the TUC who championed the cause of full-rate contributors by pressing for 6 per cent. and those like contracted-out employers and the pensions movement who would have preferred 6½ per cent.
I shall deal next with the apportionment of the ¾ per cent. abatement between employer and employee. To give a modest boost to contracted-out employers, the Government have decided to share the abatement almost equally between employer and employee rather than in proportion to the present shares of 4·5 per cent. and 2·5 per cent. respectively. The new contribution reductions from April 1983 will be 4·1 per cent. employer and 2·15 per cent. employee. It is to be hoped employers will acknowledge that we have helped them as far as possible, given the need to strike a fair balance.
I turn now to the changes in the so called buy-back terms which are the subject of the draft regulations which appear next on the Order Paper. Contracted-out schemes may in certain circumstances transfer their liabilities to the state scheme by paying premiums. A premium reading taken from the appropriate actuarial table is subject to adjustment by a device called the average market level indicator. This device was introduced as a political concession to protect occupational schemes which would otherwise have had to sell investments at a loss in order to raise the cash for premiums. It is clear from the Government Actuary's report, and generally recognised by those who contributed at the consultation stage of the review, that the present arrangement has persistently worked to the excessive advantage of schemes and the disadvantage of the National Insurance Fund. The modification embodied in the draft regulations corrects the position while at the same time maintaining the original objective. In the interests of stability, the modification is to be phased in by five annual steps.
The modified formula, based on the expert advice of the Government Actuary, is intended to secure premiums which are more balanced. The gradual phasing of the increases meets the wishes of the pensions movement. However, the Occupational Pensions Schemes Joint Working Group have in a letter to my right honourable friend expressed some anxiety about the effect of the premium increases in the event of a serious deterioration in he investment markets. So far, we have only an outline of their thinking, but we are confident that there is no immediate cause for concern and that it is right to proceed with the regulations as they now stand. My right honourable friend has made it quite clear that, when he has received full details of the group's precise misgivings, he will consider the matter further. Of course, any view expressed by your Lordships will be carefully noted and brought to the attention of my right honourable friend and the Government Actuary.
Finally, I conclude my opening remarks by reaffirming the Government's commitment to the partnership between the state and occupational pension schemes—
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a partnership which ensures that the burden of providing income in retirement is shared on fair terms. I ask your Lordships to recognise that the Government have approached these reviews responsibly and objectively and have sought to maintain confidence in the partnership by striking the fairest possible balance between the conflicting interests. I beg to move.
Moved, That the Social Security (Class I Contributions—Contracted-out Percentanges) Order 1982, laid before the House on 3rd March, be agreed to.—(Lord Cullen of Ashbourne.)
Baroness Jeger: My Lords, nothing could look duller on the Order Paper than the listing of these two orders before your Lordships tonight, and it would he very hard for people who have not taken a special interest in these matters to realise that we are dealing with orders of intense human interest which affect millions of people as regards the standard of living they can expect when they come to retire. So I want to ask the noble Lord a few questions and make some observations on what sounds a very arcane and complicated matter with which one is tempted to deal rather formally, especially in view of the considerable business still before the House.
I remember in another place when the 1975 Social Security Pensions Act was brought into force. I think that was a measure of great political courage and imagination which was approved on all sides of the House, because the introduction of the right to opt out of national insurance and into occupational schemes was, I think, a very progressive and fair measure. Because so many people are involved, we must be sure that we get things right. The noble Minister has made clear that, at present, people who opt out, enjoy a reduction of 7 per cent. in their Class I national insurance contributions. The TUC, as the noble Minister rightly said, would prefer it to stay at a 7 per cent. abatement. But I understand that employers would have preferred 6½ per cent. The Government have decided on 6¼ per cent.
I do not want to go into a great deal of actuarial detail—in fact, as probably the least numerate Member of your Lordships' House, I certainly could not do so. But I was grateful that the Minister explained that the shift in this abatement and the new division mean that, instead of a share of 4½ per cent. from the employer, and 2½ per cent. from the employee, it is now moving to 4.1 per cent. from the employer and 2.15 per cent. from the worker. My arithmetic may be appalling, and I am sure that the noble Minister will correct me if I am wrong, but as I work it out it means that the workers are about 0.1 per cent. worse off. I do not know how much that would come to in money terms for a worker on average wages per week, but however little it is, considering the very big increase in national insurance contributions overall, I hope that it is not the beginning of a further shift to make the workers' contribution greater. It may seem a small matter at the moment—0.1 per cent—but I very much hope that it is not the first swallow indicating that the Government are changing their mind and deliberately going in for a policy which will worsen conditions for the employees.
I want to raise some points which are not strictly detailed but which I think are very relevant. I understand—again subject to correction—that a change of a

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¼ per cent. is worth about £125 million to the pension industry. I think that that means that the Government ought to be dealing perhaps a little more persuasively with what I must call "the pension industry". There are many schemes which affect people who have contracted out, where transferability ought to be improved. There are many people who find that, through changing jobs—which increasing numbers of people have to do—their pension rights are still adversely affected.
When we brought in the Bill in the other place in 1975 I remember being told that the average time that a worker stayed in a job was 10 years and that much of the actuarial work was based on the fact that 10 years was a fair average. I think that anyone who stays in a job for 10 years nowadays is very lucky indeed. It is the early leavers—early leavers often through absolutely no fault of their own—who are not as warmly protected as they should be in many of these schemes. If we are to encourage the occupational pension industry, then I think that we must ask for some more social justice and understanding in that direction as there are serious losses for many people when they change their jobs. I understand that the Occupational Pensions Board is concerned about this matter and I hope that we may be able to hear—if not tonight then at some future time—what notice is being taken of their representations.
Of course in most of these schemes there is no inflation-proofing. It may be that, with the changes that are being brought in, some consideration should be given at least to an element of inflation-proofing because one hesitates to think what will happen to some of these pensions in 20 years time, in terms of their buying power. The only other point I want to make about buy-back schemes has, I think, been dealt with very fairly by the noble Minister. I understand that he agrees that the Occupational Pension Schemes' Joint Working Group has expressed some anxiety about the present situation and the very large increase which is to be phased in.
The final point that I want to make concerns the basis upon which many of these calculations are made. Again I do not want to go into detail. I shall only say that I do not think that anybody can be sure that we have the formula absolutely right. For the benefit of any noble Lord who may not have this exciting document before him I shall quote from the Explanatory Note. It says:
"These regulations continue to provide that the market level indicators are averaged over the first 5 days on which the London Stock Exchange is open during the month in which the liability for the payment of a premium arises".
It is very exciting stuff!
"But phased adjustments to this calculation are introduced where the average market level indicator would have been less than 105. Provision is also made for rounding".
This may be absolutely the best formula in the world, but I am always suspicious of such formulae and I would be interested to know whether any consideration is being given to possible amendment which obviously we cannot do tonight. But I think that it would be wrong if these measures went through the House without us indicating, from this side at least, that we do want to see them in the framework of further, longer term consideration.
7.7 p.m.
Lord Banks: My Lords, I should like to join the noble Baroness in thanking the noble Lord, Lord Cullen of Ashbourne, for his explanation of these measures. Perhaps I should begin by declaring an interest since I am an insurance broker and it is part of my task to advise my clients as to whether they should contract out of their pension schemes or contract them in.
I noticed in the Secretary of State's report—and I think that this sentiment was echoed in the speech of the noble Baroness—the following words:
"When the 1975 Bill was under consideration there was a great measure of consensus between the main political parties. There was a common will to make the proposed arrangements work and endure".
I should like to make just a brief comment on that. We on these Benches would greatly have preferred a higher basic pension and we did put forward an entirely different proposal in place of the earnings related pension. We called it the "central account idea" which I explained during the Second Reading debate in this House on 24th June 1975. But we did say that if the Government's proposals were the ones that were to be effective, and not ours, then we certainly hoped that, the decision having been made, there would be no more chopping and changing and that we would all co-operate to make them work. So there was not exactly consensus about what should be done, but there was consensus about a general effort, after the decision had been made, to make whatever scheme was chosen, work. So far as we are concerned, that still applies.
These measures are technical and not, on the whole, controversial. But, of course, as has already been pointed out by the noble Lord, Lord Cullen, they do affect all contracted-out schemes. Indeed, 45 per cent. of all those who are employed are in contracted out schemes, and that covers nine-tenths of people who are in occupational schemes. All those schemes must be reviewed in the light of the new terms. So what we are discussing this evening is of some fairly widespread significance.
We have, of course, always known that after five years the 7 per cent. abatement in the national insurance contribution for contracted out schemes would be reduced. As more people with a larger accrual period for their guaranteed minimum pensions replaced those with a shorter accrual period, the degree of funding necessary in the occupational schemes would be reduced. Of course, some adjustment is also necessary as details about the distribution of membership by sex, age and earnings are now known, but were not known in 1975, when they could only be assumed. In the light of the Government Actuary's report on these matters, the reduction to 6¼ per cent. is not unreasonable. As the noble Lord pointed out, it is half way between the 6½ per cent. which was asked for by the employers and the pensions movement and the 6 per cent.—not the 7 per cent. as, I think, the noble Baroness said—which the TUC wanted, championing, as the noble Lord said, the cause of the full contributors—those who are contracted in.
The noble Baroness referred to a ¼ per cent. alteration in the rebate as being worth £125 million to the pension industry. I think that that figure originated in an article published in the Financial Times on 4th March,

1335
and it was, as I understood it, the value of a ¼ per cent. rebate. That was the total value of it. If you reduce the rebate by I per cent., the money goes to the National Insurance Fund, but, if you increase it by ¼ per cent., the money goes to employers and employees who make the contributions, and it does not follow by any means that it will be spent on further pensions. So I do not think that it is correct to say that it is worth £125 million to the pensions industry.
However, I agree with the noble Baroness when she regrets that the split between employers and employees is marginally in favour of employers, in view, as she said, of the recent increases which have been made in the last two or three years in the national insurance contributions of employees.
There were rumours that the Government were going to make it prohibitively expensive to buy hack into the state scheme, but I do not think that that has proved so in practice. The 12 per cent. limit on the inflation figures in the five years before buying back, which was a safeguard, remains and the average market level indicators which are used to adjust the premium in the light of market conditions—that is, the premium which has to be paid to buy somebody back into the earnings-related pension part of the state scheme—have, as the noble Lord said, been working out too favourably for occupational schemes as against the National Insurance Fund. As he also said, I think that that is generally agreed. But, as both the noble Lord and the noble Baroness pointed out, some fear has been expressed that the balance has perhaps now tipped the other way.
If the indicator is in the 70–80 range, it will add 3 per cent. to 5 per cent. over the present position each year for five years, so at the end of five years, if the indicator is in that range, the premiums would be about 15 per cent. to 25 per cent. higher than they are now. I think that obviously this must be watched, and I am sure the noble Lord would agree that it must be monitored carefully. However, on the whole, I think that the buying-back position is not substantially altered.
I must resist the temptation to talk about transferability and the inflation-proofing of occupational schemes over and above the guaranteed minimum pension, attractive as it would be to do so. These are important problems, but I do not think that they are entirely relevant to today's debate. The worst problem is the long-term financial viability of the scheme in the first quarter of the next century. I am sure that we shall have to discuss these matters seriously before long, but for today we are content that these orders should be approved.
Lord Kilmarnock: My Lords, I, too, should like to thank the noble Lord, Lord Cullen of Ashbourne, for his clear and thorough exposition of the origin, purpose and effects of these draft regulations and this draft order. As he has explained, they are the outcome of the first quinquennial review of the relationship between occupational pension schemes, whose beneficiaries are partly contracted out of the state scheme, and the state scheme itself, as provided in the Act of 1975, which came into effect in April 1978, almost exactly five years ago.
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At first sight, the adjustments here may seem of small account—a matter of fine tuning of a complex scheme which is, on the whole, working rather well. The noble Lord, Lord Cullen, with some justification, claimed success for it. However, it is an important matter, affecting, as it does according to the Government Actuary's report, some 10.3 million people. Incidentally, this report Command—Paper 8516—makes very interesting reading and provides a great deal of useful information on how the Social Security Pensions Act has been working in so far as it applies to occupational pensions. I commend it to all your Lordships who are interested in these matters.
One of the most delicate pieces in the mechanism linking these funds to the basic state scheme is the state scheme premium payable when contracting-out ceases and responsibility for a guaranteed minimum pension is transferred—in full or in part—from a contracted out scheme to the state scheme. According to the Government Actuary in paragraph 55, in cases where such transfers have taken place, occupational schemes would appear to have made a profit from the contribution reductions they have been allowed.
As the noble Lord, Lord Cullen, has confirmed, this is what is really behind the new mechanism for calculating the average market indicator, which determines the amount of premium payable when an occupational pension scheme ceases to contract out of the state retirement pension scheme. There are no grounds that I personally can find for quarrelling with this adjustment, though, as the noble Lord, Lord Banks, said, I think it wants to be watched.
However, like both the noble Baroness, Lady Jeger, and the noble Lord, Lord Banks, I must express some unease at the other main provision which is the subject of the draft order: namely, that in which the state contribution reduction allowed to those contracted out—those 10 million—is abated from a total of 7 per cent. to 6¼ per cent. This in itself may be reasonable. Indeed, the Government appear to have opted for a classic compromise—the noble Lord, Lord Cullen, confessed to this—between the 6½ per cent. that was acceptable to employers and the 6 per cent. argued for by the trade unions, representing full rate contributors. However, like the noble Baroness, Lady Jeger, and the noble Lord, Lord Banks, I am less than happy with the way in which abatement is shared between employer and employee. The employer's proportion goes down from 4·5 per cent. to 4·1 per cent. and the employee's from 2·5 per cent. to 2·15 per cent. The Secretary of State acknowledges in his report—Command 8518—that:
"This split is marginally less heavy on employers than the one which was strictly proportional to the existing reduction".
"Marginal" is stretching a point, because 0·35 per cent. subtracted from 2·5 per cent. is proportionally a considerably greater reduction than 0·4 per cent. subtracted from 4·5 per cent. So the phrase "almost equally" used by the noble Lord, Lord Cullen, is not in fact quite accurate here.
One understands, of course, the desire not to increase business costs and to cushion the employer. But the proper way to do this, I submit, would have been in allowing a reduction of the national insurance surcharge rather greater than the 1 per cent. given in the Budget. The way in which the Government have chosen

1337
to do it means that 10 million people will have their pay packets further reduced—not by very much perhaps, as the noble Baroness pointed out, but it all adds up, especially on top of the recent 1 per cent. increase for all Class 1 employees. In our view, it would have been better if this abatement had been shared on a basis of strict proportionality.
Lord Cullen of Ashbourne: My Lords, I am grateful to noble Lords for their reception of these orders, and one or two points have been raised. The noble Baroness mentioned the employer's contribution rise, which was also mentioned by other noble Lords. Perhaps she would like to know that an employee on average weekly earnings will pay an increased contribution of no more than 12p per week as a result of the 0·1 per cent. reapportionment of the contribution between employer and employee. The noble Baroness asked me whether this was the thin end of the wedge and whether this might go on in the future, but I am in no position to give her any views on that subject. The noble Baroness also asked what the £125 million was worth to the pension industry, but the noble Lord, Lord Banks, kindly answered that matter for me.
The noble Baroness mentioned early leavers, and the noble Lord, Lord Banks, resisted speaking about it. It is a matter which concerns everybody. It really has no relevance in this particular debate we are having today, and it is a matter which of course is being studied, and studied very keenly. The noble Baroness asked about the market level indicator formula, which certainly looks on the face of it extremely complicated. The modified formula, like the existing formula, produces a single index number each month to be used in conjunction with the reading from the relevant actuarial table. The index number is readily available from DHSS officials, who do all the necessary calculations. Pension schemes individually do not need to calculate the index number. This is easily available to all concerned.
I would not wish to bring this debate to a close without acknowledging the spirit of co-operation between the political parties which has existed in recent years on pension matters. I believe that the political consensus has characterised our debate today and was indeed a feature of the approach to these statutory instruments in another place. The Government have no wish to disturb the political consensus, because we believe that there can be no better guarantee of the continuing success of the contracted-out arrangements. I commend to your Lordships these statutory instruments, which take into account the interests of all parties and seek to strike a fair balance between them. I beg to move.
On Question, Motion agreed to.

State Scheme Premiums (Actuarial Tables) Amendment Regulations 1982
Lord Cullen of Ashbourne Lord Cullen of Ashbourne rose to move, That the draft regulations laid before the House on 3rd March be approved.
The noble Lord said: My Lords, I beg to move.
On Question, Motion agreed to.

ECC 10th Report: Guidelines for European Agriculture and the 1982–83
7.23 p.m.
Lord Mottistone Lord Mottistone rose to move, That this House takes note of the report of the European Communities Committee on Guidelines for European Agriculture and the 1982–83 Farm Price Proposals (10th Report, 1981–82, H.L. 101).
The noble Lord said: My Lords, I am privileged to introduce the Motion standing in my name. At the outset I must remind your Lordships that I have to declare an interest, being in the employ of the Cake and Biscuit Alliance and the Cocoa, Chocolate and Confectionery Alliance, and thus have a bias in favour of food processors. I am indeed most grateful to our sub-committee chairman, the noble Lord, Lord Cledwyn, for inviting me to present the report to your Lordships on his behalf, because I had the privilege of chairing relevant meetings when we were taking evidence on which we wrote the report. I am also most grateful to my noble friend and the "usual channels" for facilitating the start of this debate just before dark. At one stage I thought I was going to be able to say well before dark, but we did not quite achieve that.
Our report considers guidelines for the improvement of the common agricultural policy which was issued by the Commission during 1981. It compares these with the price proposals for 1982–83 which were issued late in January 1982. We did not get the proposals in this House until well into February, and this gave us a very short time indeed to take the necessary evidence and to prepare the report. Indeed, though I think we got written evidence from all interested parties at—least, I hope so—we only took oral evidence from a selected few. However, all the evidence is published in vol. II of the report—which is not available today but will be shortly—and I can assure all those concerned that all the evidence, whether written or oral, and at whatever time, has been given due weight in the production of the report.
We also were only able to tackle four of the main product areas, though the price proposals cover another five sectors. There was no time to give them the scrutiny that they deserved. So once again—and we had to do this last year, and I think in pretty well every earlier year—we suggested to the Commission that these price proposals could well be submitted earlier. Just when, one cannot be sure, but clearly late January is not early enough, and we might suggest that they would consider making them before Christmas.
It would also be helpful—I do not know to whom I address these remarks; I rather suspect to the British Foreign Office—if, like many other organisations, but not parliamentary ones, when important papers of the sort of these proposals are issued by the Commission they could be got in some form or another to this House within days, and not in a week or two's time. I hope that my noble friend who will be replying for the Government will take the point that this is something which really is an administrative nonsense. It applies equally to his own department. They cannot get their papers as quickly as they should because they have to go through some process which is quite unnecessary, and yet we find that people who have offices in Brussels,

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as indeed the Government have, are able to get these papers the next day although official Ministeries, your Lordships' House and the other place, do not get them until some ridiculous machine has been made to work.
On a totally separate matter, the sub-committee fully appreciated that underlying the validity or otherwise of the price proposals was the wider discussion on the budget with its particular implications for this country. In view, however, of the timing of the budget decisions, the undesirability of speculating about them, and the need for an early report if the views of your Lordships' House were to have any impact on the decisions of agriculture Ministers who start their next meetings tomorrow, Sub-Committee D, which prepared the report, had to decide to stick to its last and concentrate on the proposals relating to agriculture and food.
In the interests of time I shall draw the attention of the House to only a limited number of major points in the report, and hope that my colleagues will fill the inevitable gaps. We start with Part II which discusses the guidelines, and those were generally welcomed by all giving evidence except the Dairy Trade Federation. The guidelines were thought by the Committee to be working in the right direction. Indeed, they followed many of the recommendations made by the Select Committee in its report on the common agricultural policy issued in February 1980. Sub-Committee D thus thought it reasonable to examine the price proposals against the background of the guidelines to see to what extent they had been progressed in those proposals.
In Part III the committee considers the guidelines and price proposals against the background of the current economic situstion in some detail. Though agriculture has suffered from the effects of inflation over past years, so have other industries, and it is suggested that agriculture should bear its share of the adverse circumstances. To inject at this point a personal thought, the difficulty seems to me to lie in the conflicting aims of Article 39 of the Treaty of Rome, which is repeated in the report to which I referred on the common agricultural policy in 1980.
I select particularly item (b) in paragraph 8 of the report, which refers to ensuring:
"a fair standard of living for the agricultural community, in particular by increasing the individual earnings of persons engaged in agriculture".
and sub-paragraph (e), which in contrast refers to ensuring:
"that supplies reach consumers at reasonable prices".
The problem is that the balance between those two points—incidentally, I note that Mr. Dalsager, the Agricultural Commissioner, in talking to the European Parliament, picked out those two as being the particular points which needed to be balanced—can be achieved only by giving due weight to the needs of all the consumers of agricultural raw materials as well as giving due weight to the producers of agricultural raw materials. And the Commission is not organised to do that. It has a very strong agricultural directorate-general in DG6, but it does not have anything comparable to look after the interests of the consumers or users of the raw materials. It needs to take a serious look at dealing with the problem.
In Part IV the committee turns its attention to a detailed assessment of the price proposals and notes that they recommend the highest increase yet made by the Commission. For those who have a copy of the report, a glance at the table at the end of paragraph 38 shows that the council has consistently added to the proposals in all the years since this country joined the Community. Not only are the price proposals inconsistent with the guidelines but they make no serious effort to contain the surpluses.
I divert briefly to draw attention to what I believe to have been the most irresponsible proposals made in the European Parliament last week, when, among other things, they called for a 14 per cent. increase in prices. We hope to hear a great deal more about that from the noble Lord, Lord John-Mackie, who kindly went to Strasbourg to attend the debates of that Parliament on behalf of the sub-committee. I would only say at this stage that those who are keen on the preservation of the Community—and one trusts that all the Members of the European Parliament, with the exception perhaps of a few Labour Members (I do not want to divert on to that) want to preserve the Community—really must (and this applies to the Commission's staff, too) take the point that if we go on overdoing the demand on Community resources for the CAP, the people of Europe will start to get fed-up—they are the consumers, after all—and say, "We have had enough of it". It is vital that those points are taken more seriously by those who are in a position to make decisions.
In Part V the committee consider the proposals for the four main product groups, but I will touch only briefly on those in the hope that my noble colleagues will tackle them in detail. The House might note in paragraph 44 of the report that support is given to the proposal for a lesser price increase for cereals than for livestock, thus introducing a welcome balance more favourable to livestock farmers. With regard to both sugar and milk, commented on in paragraphs 60 to 70, the proposals do nothing effective to contain surpluses and indeed pass on extra prices to the consumer. Particularly disappointing is the idea of a super levy specifically designed to discourage increased production, which has once again been discarded by the Commission. Concerning beef, the retention of the British variable premium scheme is welcomed and indeed is recommended as a permanent part of the beef régime.
In Part VI the committee give their view on the detailed effects on the United Kingdom in general and on Northern Ireland in particular, but I expect my noble friend Lord Brookeborough and the noble Lord, Lord Blease, to get their teeth into the latter subject. In the conclusions, in Part VII, the committee summarise the good points of the guidelines, welcoming particularly the concept of production objectives five years hence and the strong recommendation that the common policy should be for food as well as agriculture, on the lines recommended in the committee's 1980 report on the CAP, which is referred to earlier. In paragraph 83, the committee sums up its disappointment at the price proposals not carrying forward the imaginative suggestions in the guidelines.
The report concludes with a summary of the detailed point made by the committee. There are many

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nuggets of valuable information at the end of volume 1 of the report, in the tables, and I would draw your Lordships' attention particularly to table 9 and the two Ministry of Agriculture notes immediately following it. I believe those to be particularly valuable for general consumption. I suspect we may have two tables numbered 1; there is a table No. 1 at page XXX and another table No. 1, which I think should be No. 10, at page XLVI. That is the only mistake I have found, although I cannot claim to have read through the whole document completely thoroughly.
My noble friends who are gallant enough to take part in this delayed debate will appreciate that the more quickly we speak the more we shall be able to cover. have endeavoured desperately to keep to under 20 minutes; the noble Lord, Lord Mackie of Benshie, did not think I would make it in 15 minutes, and he was right, but I hope to do it in 20.
Lord Mackie of Benshie: Would the noble Lord give way?
Lord Mottistone: I hope the noble Lord will not stop me now, my Lords, because I have nearly finished and whatever the noble Lord wanted to say he will be able to say in a moment. It is sad that the first faltering steps in the guidelines towards rescuing the common agricultural policy from becoming the scapegoat of all the ills of the Community, whether real or imagined, seem to have been halted by this year's price proposals. My Lords, I beg to move.
Moved, That this House takes note of the report of the European Communities Committee on Guidelines for European Agriculture and the 1982–83 Farm Price Proposals (10th Report, 1981–82, H.L. 101).—(Lord Mottistone.)
7.37 p.m.
Lord Mackie of Benshie: My Lords, the noble Lord, Lord Mottistone, moved the Motion in a shorter time than he thought. Like many people outside agriculture, he missed the fact—he missed several facts, but he missed this one in particular—that the clock did not change, so he actually moved it in about three minutes less than the time he thought he would take. However, one expects farmers to be sharper than other people at noticing such matters. I wish at the outset to declare an interest, which is a total, strong and wholly subjective interest. Nothing I say will be fair. It will be directed wholly towards the farming industry because I regard that as the most important industry in the world, one which is in sad straits in many places.
I have been a member of the committee for some years and I have always tried to be objective. I have always thought that the greatest asset a farmer needs is not high but secure prices; he needs to know that he will get a certain price for his produce. He certainly needs, as a producer who takes two, three or four years in planning and producing his goods, to have some protection against the vagaries of the market. In that market, a 5 per cent. surplus can drop the price by 50 per cent., while a 5 per cent. shortage can raise it by 50 per cent., which is much to be desired. But taken as a whole, farmers have accepted that security is more important to production than high prices.
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We are looking at the whole question of the CAP, which is what everyone is now doing. We are not discussing simply the price view. We are discussing the whole trend of the CAP, and when we do that we ought to look at the trend in the world. The prices in the world markets are set by two factors. One is the CAP's subsidised export policy. That is one of the major factors in reducing the world price. The other is that in the United States and Canada there are enormous areas of land and by the prodigal use of cheap energy—much cheaper than ours—they race over vast tracts to produce grain in particular at a price which is below the cost of production in Europe.
But how long that can last in a world in which there is a shortage of energy I do not know. I do not think that it can last very long, and certainly we are getting many signs that the world cost of food is going to rise. I believe that we ought to take this factor into account when we are talking about the future of the CAP. I also believe that we ought strongly to take into account what is happening in Europe today. The NFU and other farming bodies have produced masses of figures, which cannot be contradicted, about the state of the industry. I know that all industries are in a curious state; the recession and the high interest rates have seen to that. But in farming there has been a steady decline in real income and an enormous build-up in indebtedness, which in Denmark, with high rates of inflation, is now resulting in a flood of bankruptcies. One-and-a-half years ago there were between only 100 and 200 bankruptcies in Denmark among the farming community, but I think that last year the figure was in the region of 4,000. There has been this sudden onrush of difficulty, and of high interest rates; but it must also have something to do with low returns.
When we look at the CAP we must take into account the other factors as well. I agree that the consumer and the processor have to be taken into account. But in fact the farming industry is in a bad way. It has to its credit tremendous achievements in Europe in the supply of, and continuity of supply of, food and in the lowering of the world price of food. But such achievements will not continue if farming falls into a greater and greater state of indebtedness and suddenly large numbers of small farmers in Denmark and other countries not backed by a strong industrial base start to go bankrupt.
We have the special case of Northern Ireland, which I agree should be treated as a special case when one considers the energy and efficiency with which the livestock industry there was built up on the competent importing and unloading of grain. I agree, too, that we must consider the consumer. I say "consider the consumer"; of course we consider the consumer, we are producing for the consumer, the consumer is our customer. But I should like us to assess how the consumer is doing. There do not appear to be any figures in the report which actually give that information. There must be such figures, and I am sorry that I have not myself managed to dig them out. I should like to see figures relating to inside the Common Market for the consumer's proportion of income spent on food. Certainly as prosperity rose in the Community over the last 20 years the proportion has been going down; I think most people know that. But we really want to know whether the consumer is

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getting a fair deal. Of course the consumer always wants cheaper and cheaper food, particularly in this country, where there has been a tradition of cheap food from abroad. But I should like to have the actual figures. I think that our Committee might well look them out and try to do something towards showing whether the consumer is getting a fair deal, rather than merely leave it to the consumer to "beef" about general prosperity in agriculture, which is more imagined than real.
The noble Lord, Lord Mottistone, declared his interest with total frankness. I am always "rabbiting on" at him about the processors and how incompetent they are—in a joke, but not much of a joke. The Ministry of Agriculture has produced very interesting figures, which are given in the annex to the report. It is stated:
"Since the end of 1978 retail food prices have risen 37 per cent. compared with 51 per cent. for the all-items retail price index".
That is a considerable difference; it is a very significant figure. But the really significant figure is that of the 37 per cent. rise
"roughly two-thirds…was attributable to the rise in the costs of processing, packaging, distribution and retailing",
and only one-third was related to the miserable farmer who, it is traditionally claimed, is over-fed, over-rewarded and feather-bedded in this country. I think that your Lordships' House would do well to note these official figures. I think that the House should also note other figures, which are easy available, such as those relating to the rise in productivity in farming; and if in this country we had the same rise in industry, we would be way ahead of Germany, France and all the other countries of Europe.
As regards the detail, I have gone over the points and I think I have 10 "Yesses" to our Committee's proposal. One cannot expect a committee to be wholly unanimous in these matters, much though I respect many of our members. I wish briefly to make one or two points on some of the questions raised. Paragraph 85(iii) of the report states that
"An increase of 9 per cent. in institutional prices is too high, if not accompanied by realistic production objectives".
I think that that is a very good point. We really must guarantee a price to farmers. I do not think that 9 per cent. is too high, but the figure must be tied in with some limit to production, and we cannot guarantee any given amount of increased production. The report of the committee also states:
"The interests of consumers and the food industry should be given greater weight in the formulation of a common policy for food…".
I consider that that is not a correct statement. I think that the interests should be given proper weight, not greater weight than they merit. Proper weight at the time depends a little on what one thinks oneself.
With regard to cereal substitutes, although at present the import of manioc is valuable to Northern Ireland, which is a hard-hit area, we need to look at this question in relation to the common agricultural policy as a whole. The common agricultural policy is about producing and protecting the growth of cereals and other crops in this country. Why one should discriminate against the third world producer of barley
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in favour of the third world producer of manioc I do not know. It is not logical in any shape or form. Personally I disagreed whole heartedly with the committee on this point. Of course we must take account of the damage that has already been done to the economy of Thailand by the encouragement of this production, but we should realise that the situation is not logical.
I do not propose to speak for much longer. I believe that the Committee has done extremely valuable work. It does work that no one else does, and the report is extremely valuable. However we must be very careful that we do not suddenly find that we have knocked back a very competent and efficient industry and that it is then incapable of doing its job when the world trend in production of food might well go into reverse and we might again be short of food in the world.
7.50 p.m.
Lord John-Mackie: My Lords, I have often been thankful that my noble brother is about 12 years younger than me, which has shortened the period that I have had to play second fiddle to him. As the noble Lord, Lord Mottistone, said, on behalf of the subcommittee I was very lucky to be sent over to Strasbourg to listen to the two-day debate on this subject. He mentioned the difficulty of getting papers here. I can assure him that there was no difficulty over there. It was quite amazing how the report or any document one wanted was produced literally within minutes over there. Like him, I see no reason why it should take so long here, and I am glad he has put it to his Front Bench that they should do something about it.
In Strasbourg, the French farmers demonstrated outside the building. My French is not very good but I thought that I should go and try to speak to them to see if I could get anything out of them. The two I fell in with who were willing to speak to me were what I would call roughish sorts of chaps who were obviously a working farmer and a wine-grower from Montpellier, with whom the only thing I had in common was our liking for the stuff. I then pointed out to them that I was a farmer, and they immediately stood back and said, "Oh—a gentleman farmer!" I have always liked the occasional times when I have been called a gentleman, and after 55 years working I can hardly not be a farmer; but when the two are coupled together I cringe a bit. I had difficulty in explaining to them that I really was a working farmer.
I think this demonstration was very well conducted, and I think the French farmers have a case. Obviously their income has been falling very quickly indeed. I spoke to somebody from the Milk Marketing Board who had been at the Paris demonstration, and they said that was an extraordinary demonstration, very disciplined in every way and obviously one that was carried out not to create a furore but really to impress on the French Government the difficulties under which the French farmers suffer.
So far as the debate was concerned, and the set-up there, I was rather disappointed at the very few people who attended for this very important debate. Out of well over 400 MEPs there were roughly only 40 or 50 who were in the Chamber at any one time, until I discovered that every MEP has a room complete with a

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television set and a comfortable chair and that it is much easier to see and hear the debate there than in the Chamber. Even when the President of the Commission spoke, and other notables, at the small ceremony that there was at midday on the Thursday to mark the 25 years that the EEC has been in existence, there were less than 20 per cent. of the MEPs there. So I was rather disappointed in that.
I also found the debate very difficult to follow. No doubt many of your Lordships have been there, but it is a huge amphitheatre and it was difficult to place the various political categories as they spoke. The other thing was that although I would hand it to the interpreters in their interpretation, it was very difficult to look at a man speaking and listen to a woman's voice interpreting, and vice versa. But you did get used to it.
On a broad basis, I should like to make one or two points. One of the things that was raised was the question of green money, MCAs and the European monetary system. These were mentioned by many speakers, and it was pointed out that the EEC could never operate properly until MCAs and green money were done away with and every country, including Britain, joins the EMS. I trust that the noble Lord, Lord O'Hagan, will come back to this House and try again. We all know the many difficulties in getting rid of the MCAs and the green money and joining the EMS, but I think it is absolutely essential that we get over those difficulties as soon as possible.
Another point mentioned was inflation and the effect that it had on trying to arrange prices with countries with different levels of inflation. This difficulty was brought up by quite a few of the MEPs, and one can quite see, of course, that if you got inflation down to a common level, and a low level at that, then fixing prices would he much easier.
The other broad point I would wish to mention is that many MEPs mentioned the fact that unless the CAP was a success, as it was the cornerstone of the EEC things could go very wrong indeed. I am paraphrasing here, but, as we all know, in Article 39 the objective is to increase agricultural producion to give (1) an adequate supply of food at (2) reasonable prices to consumers and provide (3) a fair standard of living for the farming community. I am not sure that my noble brother would agree with the adjective "fair" when referring to the standard, but I think that is reasonable.
It was very forcefully pointed out by many members that (1)—that is to say, the production of food—had been achieved, but that (2)—the reasonable prices—was in doubt, and, in relation to (3), whatever standard had been achieved in the first 20 years in the last five it had been falling and falling rapidly. This was very strongly put, particularly by the French and the Italians.
At suitable times during the debate the President of the Commission, Mr. Thorn, and the President of the Council of Ministers and the Commissioner for Agriculture all made quite long and detailed speeches to members to try and get them to accept the Commission's proposals of 9 per cent. Of course, it was of no avail, but I should like to quote what M. Dalsager said at the end of his speech:
"In terms of expenditure alone, the figures are respectively"—
that means for the rest of 1982 and then for a full year—
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"about 800 and 1,600 MECU"
for a 14 per cent. rise in prices. Then:
"Our own proposal…would mean a net increase in expenditure of about 400 million ECU in 1982 and about 800 million ECU in a full 12 months".
But the main point that he made—and I am quoting again—was:
"We consider that, with the economies that are still possible in the 1982 budget, it should be possible to finance this expenditure without a supplementray budget".
I think that is a very important point that he made. However, as I say, their appeals were to no effect.
I shall try to keep it as short as possible, but perhaps I can give some of the main points that were made by the members. One was whether you could graduate prices in various ways in line with the level of inflation in particular countries. This was emphasised by one or two people, but one of the British members did not think that this would work, it would be far too difficult. I think he was probably right there. Of course, great stress was laid on what a 16 per cent. increase would do to the budget figures, which I have quoted. They were 14 per cent., and 16 per cent. would be more; and, of course, as the noble Lord, Lord Mottistone, has pointed out, in paragraph 28 of our report we show the figures indicating what would be the effect of a 9 per cent. increase.
There was a lot of discussion—my noble brother mentioned this—on how much effect each 1 per cent. increase would have on retail price increases to the consumer. One person mentioned what a burden this would be to food manufacturers, and I am sorry to say to the noble Lord, Lord Mottistone, that that was not received very well. There was also much discussion on the closing of the gap between the EEC prices and the world prices, particularly the USA cereal prices. It was very ably pointed out by one member how difficult this would be; that it would only be done by increasing world prices in various ways—increasing the price of the energy required to produce food in the world, and the various tremendous demands that there will be as countries develop and are able to pay for more food—because it would be very difficult indeed to actually reduce EEC prices. One member pointed out very ably that reducing cereal production would simply be cutting our own throats. This is quite right; we would simply have to import more, and the economy would be worse off.
There was a very interesting point made by a British member. As has often been pointed out, the small dairy farmer, particularly in Italy, in France and in Bavaria, has no method open to him other than the production of milk. This British MEP said that there was and I agree with him. Specialised beef production is a possibility in these small dairy farms and it should be encouraged. If this recession would recede, if I can use such a term, then the demand for food should increase, the demand for beef should increase and this would help the changeover from dairying. It should be pointed out that beef production makes for an easier life than milk production.
There was a voluable Greek who said that they were not able to sell their oranges. A lot of countries in the EEC were buying oranges from South Africa and elsewhere. He thought there should be far more emphasis on internal trade. He felt so hot about it

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that unless things improve, he said, then Greece should get out. I think that all I would say about the French Members is that they were all for the farmers. An Irish speaker made an emotional speech saying that the argument was not about prices but about people. I think there is a lot in what he said. We all know that a rise in farm prices affects the community, the whole community, in the countryside. We are inclined to be talking prices all the time and to forget about the effect on the rural community. He was very much against Britain buying from New Zealand and Australia and he was also against bureaucracy in the EEC, saying that more attention should be paid to the elected body in Strasbourg where he was speaking. He supported the demonstration outside and wanted the full 16 per cent.
Then I would refer to the only person who mentioned the question of reducing costs, which is a very important consideration in this argument. He pointed out that it was the continual increase in costs which caused the demands for increasing prices. He was an Italian MEP and his speech was well received. I think it should be given attention. There was a Dutch Member who felt that the farms were getting too big and, speaking at one time in my life from a large glasshouse myself, I would agree there, because we have got a situation where land is getting into too few hands and the farm family is not farm fully appreciated. Another Irish speaker was very annoyed at Britain. He said they had changed the rules twice. I am not sure which rules he referred to and I am not sure about twice, but he made the point hotly. He felt, too, that national aid should be used more to influence prices rather than on the produce.
A Danish Member, a man after my own heart, wanted all surpluses to be channelled to the people who need them in the developing countries. He admitted that there would be some difficulties with sugar which many developing countries produce; but he has a point. Somebody raised the point that perhaps providing food and advice to the developing countries would ultimately hurt our own farmers, but that was not too well received. One Member thought that we should use food exports, as do the Americans, as a weapon. The point was made that national aid was eroding the CAP and emphasised that national aid would need to be controlled very shortly.
The British Left tore into the farming lobby—and I do not need to tell your Lordships who did the tearing. There were strong pleas for the consumers and it was interesting that in the same Left-wing bloc in the Chamber, the French, Italian and to some extent the German Left took a different attitude, no doubt due to where their political support came from.
There was a proposal that a means test should be developed in order to provide direct aids to farms, but this was not well received. I should say that fvoting took place on 87 resolutions and that all of them, discussed separately, took the whole morning, from 9 a.m. till after 1 p.m. Your Lordships know the result. They voted for the 14 per cent. increase. The British Right voted for it.
On our report, which disagrees with this figure, there will be a lot of argument before the final figure is agreed.
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On the general principles of our conclusions, I agree; but I would add a rider to No. 4. If a reduction in farm incomes reduces production or creates bankruptcies as in Denmark, as my noble relative mentioned, we shall have a self-defeating exercise. Farm incomes do more than give a living to the farmer and his family. They have to provide for expansion and if the industry has not the resources to do this it will not achieve the objectives of Article 39 of the Treaty. That is all I have to say. I know that there is a lot to be filled in and I hope that some of my colleagues on the Committee will do so. I should like to congratulate the noble Lord, Lord Mottistone, on chairing most of the committee work which was done. I have sat under many chairmen but I have never met anybody better at slapping one down pleasantly, with no umbrage on either side. I should like to congratulate him on the way he did it and the speed with which he carried through this report.
8.7 p.m.
Lord Walston: My Lords, I should like to continue on the note on which the noble Lord, Lord John-Mackie, closed and to thank the noble Lord, Lord Mottistone, for his introduction of this debate and for his chairmanship of those meetings of Sub-Committee D which were largely instrumental in producing this report. I should like also to thank the chairman of the committee, the noble Lord, Lord Cledwyn, for the part he played in this, both in the background and in the foreground, and to express my disappointment that he is not taking part in this debate, not only as the chairman of Sub-Committee D but also as a former Minister of Agriculture and one of the most knowledgeable Members of this House in this whole vast, important subject.
My Lords, I go on, alas! with an apology. I am already overdue at a dinner meeting with the National Farmers' Union at which they wish to put to certain members of the Social Democratic Party their views about agriculture; I should already be there. I hope your Lordships will forgive me if I do not follow the correct—and my usual—practice of remaining until the end of the debate, but I feel it is important for me to move on. In particular, I apologise to the noble Earl for not being here to listen to his final comments. I can assure the House that I shall read in the Official Report not only what he has aid but what is said by all other participants in this debate.
In spite of the place where in due course I am going to take some light refreshment and in spite of the fact that I am a farmer myself, as I think some of your Lordships may remember, I want to make it clear that I am in no way a spokesman for the NFU. In fact, if they were to listen to what I am going to say they might be unhappy that they had invited me this evening. It is not that I do not think that there is strength in some of their arguments; but, as so often is the case in these matters, those arguments are somewhat overemphasised, whereas the other side of the arguments is glossed over.
I suggest that in any discussion on agricultural policy—and that includes of course the pricing mechanism—there are three outstanding points that must be borne in mind. The first of these—I have said this before, but I think it bears repeating—is that farmers

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have no God-given right to grow food and crops in any unlimited quantities according to what they wish to produce. They have no more right to be farmers than doctors have to cure the sick, than engine drivers have to drive engines or stockbrokers have to broke stocks. The only justification for doing these things is if the consumer wants the produce, if the patient wishes to he cured, if the passenger wishes to be driven in the train and if the investor wishes to have his stocks exchanged. So it is with farming. We can only justify our existence as farmers if we are producing what the consumer wants and, coupled with that, at a price that the consumer can afford.
The second point is that farming is becoming increasingly specialised. The days are past when the average farmer, the typical farmer, had a few acres of wheat, potatoes, turnips and sugar beet, and a few cows to be milked, a few chickens from which he collected eggs and a few pigs that he fattened. Those things are in the far distant past on almost every farm in the United Kingdom and a growing number of farms within the Community.
Farming is a highly specialised operation and a highly capital-intensive operation. You have to be a specialist grain producer, a specialist dairy farmer or a specialist pig producer. In order to be that, not only do you need the expertise—which takes many years to acquire—you also need very heavy capital investment. It follows from that that one cannot shift from one form of production to another, from one form of cultivation to another, depending on relatively minor alterations in the prices of the different commodities year by year. So it is hopeless to think that, by manipulating prices by the annual price review, or whatever one wishes to call it, that takes place in Brussels, one can significantly alter the pattern of agricultural production. That can only be done—and I shall revert to this later—by a long-term policy which people accept and believe in.
The third point that must be borne in mind is that while undoubtedly a decline in the profitability of farming hurts the farmer—he has less money to spend—provided that decline takes place somewhat slowly, he can in the main adjust himself and adjust his form of farming and adjust his way of life. He will not he able to have so good a life as he had when profits were high, but he can survive. In the long term, the real sufferer is the consumer, the nation. We have a vast investment in our agricultural land. If the fertility of that land declines—as undoubtedly it does in periods of declining farm profitability—if the equipment of that land is not renewed and maintained, if the research and development of all the ancillary industries, the geneticists, the plant breeders the cattle breeders, the agro-chemical research chemists and all the rest of them, and the machinery designers also, is not maintained, then eventually there will not be so much investment in all these essential aspects of modern and efficient farming. Therefore, sooner or later, after a period of 10 or 15 years, the efficiency of farming will decline, the cost of food will rise and the consumer will suffer.
It will cost hundreds of millions of pounds to redress that balance. As we experienced in the run-up to the war years, after years of decline of agriculture through the depression, the late 'twenties and 'thirties,
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the cost to this country of rehabilitating our land and agriculture was enormous. Those are the three factors which must be borne in mind in attempting to formulate an agricultural policy and even in attempting to come to reasonable prices for farmers and for consumers.
The noble Lord, Lord Mottistone, has rightly said that the guidelines produced by the Commission show signs of moving in the right direction and of accepting these points that I have made. They specially recognise the importance of the long-term nature of farming. A five-year rolling programme is the right way in which to start to achieve this, with the Commission saying how much of each of the major commodities it wishes to produce for the consumers within the Community, and basing the price proposals upon that long-term rolling programme. It is very sad indeed that, having said these brave words in the guidelines, today's price proposals make no mention of them whatsoever.
In so far as the Commission attempts to do this, it is in my opinion doing it in the wrong way. It does put forward some target for wheat production for the coming year—a target. But the target is higher than the present amount of wheat produced within the Community. Whatever may be happening in the years ahead—and I think that in the next 10 years we may well experience a great difference in the availability of wheat on world markets—there is no getting away from the fact that there is today a world surplus of wheat and that the price that is being paid to the Community producers is higher than the price that would have to be paid on the world markets. It surely would be right not to reduce the price of wheat but to reduce the target at which we are aiming, to reduce the standard quantity, in view of the world situation.
Similarly, we have a world surplus of sugar, yet there is no mention in the price proposals of reducing the quota that already exists for sugar. I know that it cannot be done until next year, but there is no indication that next year there will be any attempt to do this. With milk, we have the same situation: over-production of dairy products throughout the whole of the Community. Although there could be a super levy by which, in effect, the price received by the producer for milk would he reduced pro rata according to the amount by which the producer exceeded the standard quantity or quantum—whatever word one wishes to use—the price proposals have run away from even that step in the right direction.
It must be a fact that, once this quantum, this standard quantity, this objective—whatever one wishes to call it—has been fixed, it will be then very much easier to arrive at an appropriate price for the commodity in question. So far as I am concerned, I think that the target that they propose—an overall target of a 9 per cent. increase in price—would, given the situation as it is today with inflation of costs, be a perfectly reasonable one if the quantum that was to be produced and which was subject to this guaranteed price, was in fact a realistic one instead of being an increase on the present year.
I say that I would support a 9 per cent. increase in price because some facts that perhaps we do not appreciate enough are contained in this important little publication, The Annual Review of Agriculture 1982

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from the Ministry of Agriculture. On page 12 is a table (Table 1) which shows that the annual average index number of the price of goods and services currently consumed in agriculture—in other words, the cost of inputs—where 1975 was 100, is now 203: that is, it has slightly more than doubled in the last six years, whereas the annual average index numbers of producer prices for consumer products during the same time have gone up only 75 per cent. I know that other industries are suffering the same squeeze and I am not complaining about it, but one must realise that this is happening and one must also realise, as the noble Lord, Lord Mackie of Benshie, rightly pointed out, that the prices received by the farmer within the Community have risen very much less than has the Retail Price Index or the general level of inflation.
It follows from this that the effect on retail food prices will he far less than the actual 9 per cent. rise and, on the Retail Price Index, even less than that—something of the order of 1 per cent., if as much as that. Therefore, I suggest most strongly that, in the long-term interests of consumers no less than in those of the producers, it is essential that farmers should have realistic and even generous prices for that quantity of their produce that the Community wishes them to produce. They should be free to produce as much as they like in excess of that but should not go to the Community for guaranteed prices, to take it into intervention, or to subsidise their exports. They must carry the can for anything that they produce which is surplus to these amounts.
These quantities and the prices should be set so far as possible within the five-year rolling programme and—this is a very important point—they must not be used as bargaining points within the EEC's discussions on other matters. I sincerely hope that in the discussions which are to take place shortly Her Majesty's Government will not use as a bargaining point in the overall discussion of the British contribution the matter of farm prices. It is too important to be used as a pawn in a matter of this sort.
Agriculture will never flourish and consumers will never be properly served if food production is used as a political football or as a means of bargaining between member states. It must not be influenced by the fact that there may be an election in France and the farm vote is important; that there is an election in Bavaria and the Government are losing ground; or that there is an election in this country and consumer prices must be kept down. These are not factors which should be borne in mind in arriving at decisions on matters which affect not the immediate future—they cannot affect that—but the future well-being of this country's and the Community's most important industry and the industry which provides the very means of livelihood to the whole of the population.
8.25 p.m.
Lord Stodart of Leaston: My Lords, I, like many others so far, must declare an interest. I am a farmer and I have no hesitation about saying that I am thus biased heavily—though I think not quite so heavily as the noble Lord, Lord Mackie of Benshie—in favour of food producers. But I do congratulate those who have
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produced a most interesting report—and I agree with the noble Lord who said, "with many nuggets of valuable information". However—and this is perhaps where I may become slightly irreverent—I am bound to say that I feel a certain wry amusement at the views which have been expressed in advance of this debate in material sent to us by the food producers (the National Farmers' Union), on the one hand, and, on the other, the food processors and distributors, who I think I might refer to as the FMF. My amusement extends also—I hope with not excessive irreverence—to the views of the Select Committee as expressed in one sentence in paragraph 83, which says:
"Last year the Committee recommended that guidelines should be based on a policy for food and agriculture combined. That remains the Committee's strongly held view".
On at least five subjects, neither of the two organisations seems to agree at all. On cereals, if I may paraphrase, the NFU found it "totally unrealistic and unacceptable to reduce prices". The FMF said that prices should not be increased. On sugar, the NFU asked for an above-average increase and the FMF asked for a freeze on the present price. There is a certain amount of agreement on peas and beans, in that each organisation welcomes the intention to support for human consumption, but they fall out over the demand made by the NFU for a higher price. On milk, the NFU say: "Suspend or reduce the co-responsibility levy", and, "No discrimination to favour small farmers". On the other hand, the FMF call for the price mechanism to balance supply and demand. As for the green pound, the NFU say very firmly, "No revaluation", while the FMF say "Revalue at all costs". So there is hardly a point on which they seem to agree: yet these are the two arms of the food industry with which my noble friend the Minister of State for Agriculture and Food—forgetting about fisheries for a moment—has to deal. I suggest that the composure which my noble friend invariably shows is quite remarkable, although this is perhaps no particular surprise to those who know him well.
My wry amusement goes back to a conversation which I remember having, when I was in my noble friend's position at the Ministry of Agriculture about 12 years ago, with a leading figure in the supermarket world who came to see me to question a statement I had made at a public meeting. The statement was to the effect that, of every pound that the housewife spent, the farmer at that time, in the days of the old currency, received six shillings and eight pence. That figure was official then, and I am led to believe that the farmers' share now is down to nearer 25p than 33p. But this supermarket leader asked me, "Why cause a breach between farmers and distributors, because our interests are precisely the same?" My reply then, as it would be today, was, "Our interests are, in fact, diametrically opposed. You want to buy as cheaply as you can, given that you are given the highest quality. I want to sell for as high a price as I can get". Profit is not altogether an irrelevant barometer of efficiency, and farmers are continually, and very rightly, being urged to be more efficient. What is more, one thing in these days of very high interest rates that would make perhaps not a substantial contribution, but a very significant one to farmers' cashflow, would be if these big supermarkets, who are taking up more and more of the

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food supplies of this country and who seem, from what I observe of them, to draw vast sums from their consumers in cash, could help farmers and distributors who supply them by paying them a bit quicker.
The Food Manufacturers' Federation point to overproduction in certain commodities and they call for a freeze on prices, if not a reduction. I would defy anybody so to arrange things that there is neither a shortage nor a surplus of food produced in this country. It is not possible. Of the two, I am in no doubt that surplus is the better, provided that it is not too great. One may well ask why beef is costing so much today. In one West End store at the moment, fillet steak is being priced at over £6 a lb., and I think the indications are that beef is in very short supply. It is certainly true that every abattoir in the country is working under capacity, so far as beef is concerned. If you freeze prices, what happens to production in an industry whose income went down by half in real terms between 1976 and 1980, whose borrowing has doubled in the last three years and whose prices have risen by just over 30 per cent. in the last three years, compared with a rise in food prices of 37 per cent.—this figure has already been given—and a rise in the retail price index of 51 per cent.? Without doubt production would start falling and investment would tail off still more.
I totally agree with what the noble Lord, Lord Mackie of Benshie, said about farmers' desires for stable prices, and also with the noble Lord, Lord Walston, who spoke a few words, if I may paraphrase them, about the hopelessness of darting about out of one kind of production into another, trying desperately to follow the market. I did it once in the days of my youth before the war and it landed me in the most appalling mess.
I take the point made by the FMF about consumer resistance. I would only say that consumers have brought a tremendous lot on themselves, by demanding such things as convenience foods. I have no doubt there is a figure showing what that has done in sending up the prices that consumers have to pay. I agree that some farmers still take that old wartime attitude of saying "I have grown it and you bloody well buy it"—
The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers): Order!
Lord Stodart of Leaston: "You jolly well buy it". This is why, while I think that the FMF is wrong to ask for no increase, I believe that the NFU goes too far. I think we have to share in the inflationary problems of others, and I am afraid—disagreeing with the Committee in this—that I think the 9 per cent. suggested by the Commission is not far wrong, provided that there is, as I am certain there will continue to be, an increase in productivity.
Of course, the CAP has many faults. It seems totally ludicrous that, apparently, serious thought is being given to paying higher prices for milk to farmers with five cows or even less. I cannot help wondering why note cannot be taken of the success of this country's agricultural policy in increasing the cow numbers in our herds and the higher productivity and lower costs that this has achieved. As I have many times told the House as a simple farmer: Oh! for some
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simplicity in the various jargon that the CAP uses. Ten years ago, all that was pretty impossible to understand were things called positive MCAs, supplements and abatements to target prices. But now we have not only positive MCAs but negative ones. We have the milk co-responsibility levies and proposals to modulate them, and grain weights quoted in kilogrammes per hectare-litre: and I defy any noble Lord to convert those into pounds per bushel, even with a pocket calculator. If only we could get some of the terms that are used in the Community changed, so that farmers could really understand them, it would be a tremendous blessing. I would say: Yes, by all means trim the fat and the flabbiness off the CAP. There is a tremendous lot of it there. Make it into a much more effective and a much more disciplined machine. But what experience I have had leads me to be a very strong supporter of a really healthy and highly productive home agriculture.
8.39 p.m.
Viscount Sidmouth: My Lords, 1982 has not only brought the 25th birthday of the European Community, but is also proving to be somewhat of a crisis year. By fairly common consent, this crisis arises from the predominance of the common agricultural policy in the affairs of the Community, even though it is only one of the subjects deemed in the Treaty of Rome to be in need of a common policy. This situation traces back to the political facts of life when the Community first came into being, in that, owing to the unfortunate absence of Britain at that time, the two countries whose interests had most importantly to be considered were Germany and France. Accordingly, a basic deal was struck, whereby Germany gained a great new free trade area for its manufactured goods and France the same for its agricultural produce. Thus, from the start, the advent of Britain with its efficient agriculture was bound to create problems, which have yet to be resolved.
The basic procedures of the CAP have seemed vulnerable, ever since they were first enunciated some 20 years ago, in their declared purpose of ensuring a fair return to the farmer at reasonable prices to the consumer. Several noble Lords have referred to this project which is, in any case, akin to squaring the circle. There are those who think that it can only be done by having an unlimited world market in foodstuffs, with the rules of competition being the final arbiter of prices. This is neither the time nor the occasion to examine why that policy is considered unworkable and has been rejected by the Community in favour of a managed régime within the economic boundaries of the Community itself. The doubt, I believe, has always been that the system of support and guaranteed prices which has been adopted would not in itself be sufficiently finely tuned to control the surpluses which were in some cases endemic when the Community came into being.
In the event, the machinery has worked rather better than might have been expected, though not without producing some well-publicised surpluses and throwing up the problem of the British balance of payments. The guidelines for European agriculture, produced last year by the Commission and referred to in paragraphs 7 and 8 of the report of the Select Committee, must be

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seen as going a considerable way towards better regulation of overall production, though hardly perhaps in themselves towards solving the British problem.
The report approves the guidelines in the main, with the exception of the "active export policy". It goes on, however, to touch on what is thought by many to lie at the root of the matter, which is political acceptance. In a speech last night the President of the Community referred to the increasing divergence of views between the member states which is rapidly creating a situation where policies, soundly based on economic and administrative sense, get lost or contorted in the political punch-up. He attributed these bad effects to General de Gaulle's concept of Europe des nations and the doctrine of unanimity, which in effect gives a veto to each member state in all policy matters that fall to be decided by the Council of Ministers. Further progress will probably only be assured when the Council is ready to proceed by way of voting, which is provided for in the Treaty of Rome, but that day does not at present seem to be in sight.
If I declare an interest, it would normally be as a horticulturist with strong farming connections. In fact, British horticulturists have only a marginal interest in the price proposals, since very little of their produce goes into intervention. Although we come within the common external tariff, most of the strongest competitors for our market are also within the Community and we are therefore exposed to the full blast of competition, having been until nine years ago an industry fairly strongly protected by national tariffs. As some of your Lordships will be aware—and I believe that this includes the noble Earl the Minister—we are battered but unbowed. We have recently suffered serious and unfair damage from the application of national aids, and proposals regarding the Dutch gas price for their glasshouse industry are still awaited. It is much to be hoped that they will be made known before this House comes to debate the forthcoming report of the Select Committee on National Aids.
Finally, I believe the report is right in drawing attention to the importance of realistic production objectives which should be a complement to the proposals on price. In this context, it may be that price increases averaging 9 per cent. across the board are too high, but so far as the British farmer is concerned this would come down to 5 per cent. if the revaluation of the green pound is put into effect. The combined result of both sets of proposals is well set out in Table 2 of the report, which indicates that after allowing for anticipated inflation the implied real price change for British agriculture would be minus 6 per cent. in the national currency. On this basis, no one could deny that farmers are being called upon to make great sacrifices at a time of economic recession.
8.45 p.m.
Lord Collison: My Lords, I was under the impression that this debate was going to take place very much later. I am glad that arrangements have been made to bring it on earlier, but because of that anticipation I went upstairs and the Writing Room is littered with paper which I have thrown away. Therefore, my speech may appear to be a bit staccato and I hope
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your Lordships will forgive me for that. There are one or two points that I want to make, although a few of them have already been mentioned.
First, may I thank the noble Lord, Lord Mottistone, for his chairmanship of the committee and for introducing the report. As has already been said, the noble Lord was a very able chairman. Under his leadership and guidance the committee made good progress and I believe that it has made a good report. As the noble Lord said, last year Committee B said that the Commission should publish its annual review proposals much earlier to give time for public discussion and debate before the Council of Ministers considered them. This year the proposals were issued at the end of January. The committee welcomed this. However, there was still very little time for proper examination. Therefore, the committee once again reiterated its view that the Commission should publish the price proposals before the end of the preceding year.
On the guidelines, the Commission's statement,
"After 20 years the CAP needs to be adapted to the new realities of general economic conditions and of the agricultural sector itself"
is to be welcomed. It shows a sense of realism and underlines the need for progressive change.
The evidence showed that the guidelines, although criticised in many directions, were generally seen to be a step forward. The committee also took that view and considers the guidelines as a serious and useful attempt to identify deficiencies of the CAP.
The committee welcomed the proposal to issue the guidelines for five years. We believe that this is an excellent proposal, but obviously it must be—and we clearly said so—on a rolling basis. One could not set prices, for example, for five years in advance or even for next year in advance. It has to be done on a rolling basis and I am sure that that point of view will be accepted. It is equally true that action will have to be pursued consistently over several years. I am sure noble Lords will agree that it is completely unrealistic to think it would be politically possible to introduce overnight comprehensive and radical change, since any such attempt could only be disastrous for agriculture and its associated industries. Nevertheless, it was seen as important that positive implementing action should be taken this year, and we hope that they have tried to take some action which is in the direction to which the guidelines point.
The question of prices is a matter, as we have already heard this evening, of considerable controversy. On the one hand, in their evidence the NFU argue that the proposed increases are too low. We have heard about what has been happening on the Continent. We were told by the NFU of the difficulties which British agriculture has faced and of the problems relating to real incomes in the light of the proposed changes. I do not need to go over all that again, because it has already been dealt with so ably by other noble Lords. On the other hand, others, including representatives of the food industry and the consumers, have taken the opposite view. They think that the prices are too high. This difference of opinion was to be expected. There are two interests which appeal to be clashing with each other in expressing their own particular points of view.
However, in the Commission's statement the point is made that taking the real world as it is, a case can be

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made on security of employment or balance of payments grounds for maintaining premiums on output, by fixing institutional support prices at a level that represents a percentage above that determined by market forces. Agriculture has a legitimate claim to be included, but there are risks involved—for example, the danger of the industry ceasing to improve its competitiveness by raising its productivity. We have stressed that premiums for agriculture should be geared to efficient production and rising productivity. This is particularly true for those commodities which are in surplus. There is a danger too that surpluses might be perpetuated (and this could apply to the export policy too) which the consumer has to subsidise, because the high intervention prices will encourage farmers to put their crops into intervention.
There are matters of general agreement. On green currency the committee endorses the view that adjustments should be made in accordance with their expected effect on member states, which would mean a much smaller adjustment or MCA for the United Kingdom. The NFU pointed out that the Commission's proposal would reduce the value of the proposed 9 per cent. price increase (if the figure is going to be 9 per cent.) to less than 4 per cent. On some individual points, there was strong support for the committee's views on basic and super co-responsibility levies. The Commission wishes the levy to remain at 2½ per cent. This levy was intended to be used to raise revenue for the disposal of surpluses, but the sum raised is much more than can be used for that purpose so that, as the consumer representatives say, the levy is really a tax on consumers and will tend to reduce consumption rather than increase it.
The Ministry of Agriculture has always opposed the basic levy on the grounds that it has done nothing to control the surplus but has simply transferred the cost of financing it to the consumer. I understand that since our report has been published, proposals have now been laid before the European Parliament which envisage a reduction in the co-responsibility levy from 2·5 per cent. to 1·5 per cent. on the first 60,000 kilogrammes of milk supplied. That does not alter the point which has been made. The Ministry has pointed out, as we have done, that there is a great hardship on the efficient British farmer and on their efficient farmers elsewhere, because of the method. The Committee regret that the idea of a "super levy" on production in excess of the approved level has not been taken up and if it is not, believes that the levy should be much reduced if not entirely removed. With regard to the proposed exemptions for the small producer, the Ministry of Agriculture has estimated that if the measures were applied to the first 30,000 kilogrammes, a quarter of EEC milk production would be exempted. The proportion would range from 10·5 per cent. in the United Kingdom compared to a maximum of one-third in Germany, so that the United Kingdom would be funding substantially more than the others, which would amount to a very significant discrimination against the more efficient producers in the Community.
The committee expressed sympathy with the objective of helping small farmers but felt this should be done by direct income payments via social and regional funds. The committee also felt that certain steps had been taken in the direction of the guidelines and while they
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appreciate that one cannot go too far or too fast towards totally implementing the proposals, they hoped that something more could have been done on this occasion. With regard to the arguments about the price level, I am convinced that it is important that agriculture should be healthy. I am equally convinced that consumer interests should be looked after and that the interest of the trade should be looked after too. I see no reason why these three interests should not be met without damage by one to the other. If a proper policy is evolved, and I hope that it will be after the guide lines have been properly implemented, we should experience no difficulty, and disputes in most fields will be resolved because there will be a common interest.
8.57 p.m.
Viscount Brookeborough: My Lords, I first wish to thank my noble friend Lord Mottistone for his very able introduction of this report and I also agree with other noble Lords in paying their compliments on his handling of the committee as its chairman. I would also like to join with the noble Lord who expressed his sorrow that the noble Lord, Lord Cledwyn of Penrhos, was not taking part in this debate because at the other meetings at which he has chaired the committee, we could not have been better chaired.
My noble friend Lord Mottistone was faced with a time factor and he certainly carried that through when it came to the revisions. I would like to pay special tribute to our specialist advisers, our clerks and our printers. Whipped on, as we were, by the noble Baroness, Lady White, to get the report through on time, the printers were faced with an unreasonable task and they have done a magnificent job. I would like that to be recorded. I should like to thank also the noble Lord, Lord Mackie of Benshie, for his support on those problems which affect Northern Ireland. I feel that my noble friend the Minister has really had quite an easy ride because I had understood that my noble friend Lord Mottistone was going to give him a slight roasting. I hope my noble friend the Minister will be able to answer some of the problems which we shall put to him.
I would like to draw the attention of this House, first, to paragraphs 78 and 79 in which, for the very first time, a separate paragraph for Northern Ireland and its special problems has been inserted. I should like to thank noble Lords on the sub-committee and on the whole of the Select Committee for their co-operation and sympathy in dealing with what is really a very special and difficult problem.
Agriculture is the most important industry in Northern Ireland. As, daily, other industries are hammered the position of agriculture becomes more dominant. Unemployment in our Province is running at twice the national average and so the importance of maintaining employment and of maintaining the social structure of Ulster becomes even greater. The noble Lord, Lord Stodart of Leaston, said that the income of farmers in the United Kingdom has gone down by 50 per cent. He may be using a different date on which to base that figure, but the figure I have for the United Kingdom for 1974 is 20·6 per cent. But, even if it is 50 per cent., when we compare the amount that the income for the farmers of Northern Ireland has

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dropped—85 per cent.—we can see what a catastrophic situation is facing agriculture. I am sure, therefore, that noble Lords are not surprised at the interest I take in this discussion of both the guidelines and the actual price review. I join with other noble Lords in declaring an interest. I do not believe that any noble Lord reading Hansard would be under any illusion that I am growing fat on the profits of the CAP, because our income has dropped by 85 per cent.
The brutal fact about the CAP is that, so far as Northern Ireland is concerned, it is a disastrous policy. Here we have an efficient and ingenious industry which is surviving now on national aids provided by Her Majesty's Government in Westminster. Each of these national aids is laboriously negotiated in Brussels, wasting a lot of time and a lot of negotiating room for manoeuvre. It cannot, in my view, be a long-term solution.
In paragraph 79, our committee suggested that special measures would be needed to redress the disadvantage just mentioned, and they say:
"The Commission has recognised that special circumstances affecting Northern Ireland justify special arrangements".
This is because in the sheep régime special arrangements are being made. This paragraph was triggered off by the proposals in the guidelines and the price review to limit the importation of manioc from Thailand and maize gluten from the USA, and to put four times the duty, £40 a ton, on bran and wheat screenings. The Select Committee has made clear its opinion about the intention to do this in another report. If this action were taken by the Commission, I believe that the effect on our trading partners would be far more damaging than has been appreciated so far. The underdeveloped countries, such as Thailand, irrespective of what has happened in the past, would not trust us any more if we in the EEC encouraged another underdeveloped country to develop something else. I agree with the noble Lord, Lord Mackie, that it is difficult to justify bringing barley from a third world country under duty and not doing the same with manioc, but the fact is that the EEC encouraged the production of manioc and we cannot now duck our responsibilities.
So far as the United States of America is concerned, I do not believe for a moment that they would take kindly to limitation on their export of maize gluten. So what would we have? We should find ourselves able to hammer the weak, the underdeveloped, and unable to touch the strong in the shape of the United States of America. The effect of this—and I am now talking about Northern Ireland—would be to raise the price of compound feed in Northern Ireland. On accession, Ulster was denied access to the world market with a very efficient pork industry. The position today is that the pig industry is down by 40 per cent.; where we were killing 30,000 to 40,000 pigs a week, we are now killing about 17,000 pigs a week. But the industry—that is, the whole industry, the farmers and the millers—by ingenious use of manioc and other cereal substitutes has managed to stabilise itself. Now what happens? Once we have got the industry stabilised, the Common Market is about to change the rules, and change them, so far as I can see, without any reference to the damage
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it will do to Northern Ireland agriculture. Maybe they hope the Government at Westminster will provide more natonal aids to take us out.
I speak with the full authority of the industry when I say that any extra costs applied to Northern Ireland as a result of this decision must be compensated for. If any extra costs are not compensated, then we are going to halve the industry again; we are going to have 5,000 people on the dole at an expense to the Treasury of £25 million. We have suggested in our report that there shold be an incorporaton levy or subsidy, as happened with skimmed milk in days gone by. This would only cost about £3½ to £5 million, depending on the rate of the levy and other matters. Surely this must be the right thing to do in view of the appalling social consequences which would happen if we did not have a compensating subsidy.
I now turn to milk. As everyone else has said, we are all opposed to the co-responsibility levy. It is too high. It cannot be used for the purpose for which it was originally raised, for the promotion of the product. Here again, Northern Ireland has a special problem, and this is a result of a decision by Her Majesty's Governments of the past, because on accession it was decided that the method of determining the price for milk in the United Kingdom should be on the mix of liquid milk and manufactured milk in each of the Milk Marketing Board areas; that is, the Northern Ireland mix should be one thing and the Great Britain mix should be another. In Great Britain the amount of high-priced milk going into the mix is 50 per cent. of production; in Northern Ireland it is only 17 per cent. The result has been a significantly lower return to the Northern Ireland producers. This has been recognised by Her Majesty's Government and annually they have given national aid, but the result has always been a haggle with Brussels in which we have been uncertain whether we should in fact get Brussels' approval in the end. And it has been inadequate, The profit margin in Northern Ireland is 1p per litre. The profit margin in the rest of the United Kingdom is 2·3p per litre.
I should like to ask my noble friend, is the figure in Great Britain too high or is the figure in Northern Ireland too low?—because there are no extra advantages to producers in Northern Ireland. We may grow grass more easily, but our fertiliser prices are higher. I feel that the gap between our price and the Great Britain price is too large. The difference so far, which has been made up by the Government, has come out of the Northern Ireland budget and not out of the Treasury in the United Kingdom. I wonder whether, in budgeting, if they cost production in Scotland, the extra price that the Scottish milk producers get is charged to the Scottish budget. The super levy has been advocated by Great Britain. But in Northern Ireland terms the super levy would punish us too hard. Milk is the one product which we can expand in and in United Kingdom terms it is not in structural surplus.
The time is getting on and I feel that I must try to cut short what I had proposed to say. Everything that has happened in Northern Ireland in the form of national aids has been a short-term solution. I think that in our report we provide the key. The key lies in paragraph 24 of our report, where we say:

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"In their report on the Budget Reform, the Committee drew attention to the inequity caused by the present structure of the Budget.… In the current world situation this inequity arises largely because:"—
and I shall not bother about Nos. (i) and (ii)—
"because of its relatively advanced farm structure, the UK's receipts from the CAP are proportionately less than those of most other Member States".
I think that that provides the key. Where I feel that the Government have not really played their part strongly enough or looked after Northern Ireland's case strongly enough, is in urgently pushing through a reform of the less favoured areas extension. That, if it were granted, would be an aide—to use the horrible word—communautaire that would be in accordance with the policy of the Community. It would not, therefore, be subject to constant review and constant haggling.
We are told that the Northern Ireland areas review—in fact it is now public—was carried out about two years ago, but the Northern Ireland case has still not been presented to the Commission. We were told that the whole United Kingdom case would be put in six weeks' time—that was some time at the end of November. It still has not been presented. The President of the Ulster Farmers' Union has told me himself that the Commission are anxiously waiting for the Northern Ireland case to be provided. Because it is a form of aid which is in accordance with the Community policy, they have promised to push it through extremely quickly. If Her Majesty's Government have the resolution, it is possible that the amount of money provided by the Community might go up beyond the level which is given at the moment. I press Her Majesty's Government to get on with the job. There would be less haggling; Ministers would suffer less wear and tear, and maybe our future would be assured.
9.11 p.m.
Lord Blease: My Lords, I should like to join in thanking the noble Lord, Lord Mottistone, for tabling this Motion which has enabled this House to debate and consider the important issues arising from the report. At this stage in the debate it is my intention to be brief. At the outset of my remarks I wish to indicate support for the points made by my fellow countryman the noble Viscount, Lord Brookeborough. Speaking as I do from these Benches, I should like also to say that I have every confidence in our Front Bench spokesmen on agricultural affairs. Their interest in Northern Ireland is well known. They have had ministerial responsibilities from time to time and, of course, my noble friend Lord Bishopston will be dealing in more detail with aspects which arise from the report.
My remarks are mainly directed to the position of agriculture in Northern Ireland. I find it encouraging that the Select Committee considered and reported in some detail on the particular and difficult problems of Northern Ireland's agriculture. Some of the problems, as has already been mentioned, are contained in paragraphs 78 and 79 of the report. At the same time, I must express disappointment that there is no direct reference to Northern Ireland in the summary of conclusions. I felt that, having justified two extensive paragraphs in considerable detail, at least they would
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have merited some consideration in the summary of conclusions.
Others have declared an interest in this particular debate. My working background and experience has largely been in trade unionism. It is from that background and experience that I can say that the agricultural and farming community is firmly integrated into all aspects of life in the Province. Manufacturing, commercial and business life in Northern Ireland is greatly influenced by the prosperity and buoyancy of the farming community. Trade unions and the Ulster Farmers' Union have very cordial working relationships. In the Province, where unemployment is at 20 per cent., as the noble Viscount has already mentioned, we depend a great deal on agriculture, which provides over 13 per cent. of the jobs. Much of the employment in the food processing industries is dependent on effective and efficient farming policies.
There are sound economic and social reasons for the United Kingdom Government and for the decision-makers in the European Economic Community to take urgent and appropriate action to ensure the revitalisation of Northern Ireland agriculture. In this connection, I should like to place on record the views expressed by the Ulster Farmers' Union in a statement issued on 4th March this year. They say:
"For social and security as well as economic reasons it is vital to maintain economic activity and employment in the Province. We believe therefore that at this time agriculture should be enabled to make its maximum contribution to the economy rather than being run down as has been the case in recent years. In 1980 the net income of Northern Ireland farmers in real terms was just 15% of the average for the years 1973 to 1978"—
a point that has already been mentioned by the noble Viscount. That is a reduction in income of something like 85 per cent. The statement goes on to say:
"Bank borrowing by farmers increased from £98 million in 1978 to £186 million in 1981 mainly to keep farms going. Interest paid rose from £13½ million in 1978 to £29½ million in 1980 and £26½ million in 1981. Investment has been minimal and maintenance has been delayed. New tractor registrations were 2,421 in 1978 and 970 in 1981. The industry has been debilitated. A radical improvement in profitability is needed to restore vigour and confidence to our farming and to enable farmers to make a start on reducing indebtedness".
That is an official statement from the Ulster Farmers' Union. It portrays to us the deplorable situation in which the farming community has been placed in Northern Ireland.
You cannot get productivity and you cannot get increases in output unless there is proper investment and proper financing in connection with the economics of the farming community. Therefore, the policies that have been carried out by this Government and by the EEC have been seriously impairing the effectiveness of the farming community in Northern Ireland.
It would be wrong of me to give an impression that the United Kingdom Government have not done anything to help, because they have given some aid within the last couple of years due to the extreme depression in Northern Ireland farming. The United Kingdom Government made available £10 million special aid for 1981 and have proposed £16 million for 1982. In this connection the Ulster Farmers Union states—and here I again quote from the statement of 4th March:
"If our farmers got the same returns for their produce as farmers in Great Britain and obtained their inputs, particularly

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feeding-stuffs, at comparable prices, the need for this special help would not arise. The effect of these disadvantages on the net income of Northern Ireland farmers varies from time to time. Within the recent past the effect amounted to £40 million per year".
In other words, the statement indicates that, although they received £10 million in aid, they lost £40 million in any particular year—that is, a bad form of business if you are £35 million down, with the rate of inflation as it is at the present time.
Paragraph 21 of the report mentions that there are considerable differences between member states in the pattern of agricultural incomes. The report attempts to deal with some of the problems affecting farm incomes and especially mentions matters, such as agri-monetary measures, the cereal support prices, cereal substitutes and agricultural production targets. The report and the committee attempted in some way to deal with the detailed problems arising from these various issues. I believe that the committee noted the great disparity in farm incomes, not only between members countries but between farms within national boundaries. It is in that respect that I wish to follow the point made by the noble Viscount in dealing with the issue of the less favoured areas.
I may be wrong but nowhere do I find in the report that the Select Committee deals with this particular issue. Paragraph 48 deals with national aid, and hence perhaps there will be a future report dealing with this aspect of the problem, and paragraphs 15, 16 and 17 also skate around the issue of general economic conditions. But this is the most important factor so far as the Northern Ireland farming community is concerned, and has been highlighted by statements fom Ulster Farmers' Union and by their president within recent days.
The statement issued by the Ulster Farmers' Union in this connection—and I shall quote from it although it has been mentioned in considerable detail by the noble Viscount, Lord Brookeborough—indicates:
"A Government survey has shown that a substantial area of the Province which is not now in the less favoured area meets the criteria for inclusion. By definition conditions in areas which meet these criteria are such that the work in farming is hard and the income meagre. But in Northern Ireland even before the current economic depression, alternative employment was so scarce that families had little option but to remain on their farms".
In other words, as Members will well know, most of the farms in Northern Ireland are simply one-man operated hereditaments, and they are not able to sustain the families of the particular farmers, who are expected to look for employment elsewhere. But in a situation of high unemployment, as it is in Northern Ireland, this is an extra burden that farmers have to bear.
"The hardship to farmers in these areas is a matter of serious concern to the Ulster Farmers' Union".
The statement goes on to say:
"Government started a survey of marginal land three years ago, but have been inordinately slow in doing that work and preparing the case for the consideration of the Commission".
And:
"Three Weeks ago the Minister said the submission would be made within a few weeks";
and the Ulster Farmers' Union are pressing the Commission
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and the United Kingdom Government to make an early decision in connection with this particular issue of the less favoured areas.
I should like to end by expressing gratitude for the amount of work that has been put into this particular report by the committee, and for the fact that Northern Ireland has been specially mentioned not only in the report but in this debate, and for the interest that has been shown by a number of noble Lords in this aspect of it. I would compliment the chairman for the forthright way in which he presented the report to this House this evening. I feel that it has been a worthwhile debate, but I would urge the Government to get down to some form of action arising from it.
9.24 p.m.
Lord Forester: My Lords, at this late hour I would only make three points. Our concern is about the inequity of our contribution to the common agricultural policy. I should like to take up the point raised by the noble Lord, Lord Collison, about variable co-responsibility levies and modulation. In fact, my noble friend Lord Stodart stopped short on the latest terminology—probably wisely—of the principle of progressivity. That means that, with the variable co-responsibility levy, 78 per cent. of our production in the United Kingdom is paid at a higher level compared with 23 per cent. in Germany and 24 per cent. in France.
Those figures are bad enough, but they introduce a dangerous precedent. If the Community decide in the future that the cost of disposing of extra production should be borne through co-responsibility levy, that principle of progressivity would mean that our contribution, instead of the current 17 per cent., would be at least 20 and possibly 25 per cent., when we produce only 16 per cent. of the milk. We are trying to resolve inequities from the past. We must be careful that the Commission are not introducing new ones even now. I believe in the wider context of the Common Market. If it is to be effective, we must solve the inequities now. We have had one bite at the cherry. We now try for a second bite, possibly for five years, a five-year agreement with the Commission. Surely we must resolve the problem in the long term, before the EEC is enlarged again and the problems become even more complex.
In volume terms, investment in 1981 was at its lowest level for over 20 years. We did not come out of the 1981 price review negotiations at all well because the realignment of the central currency rates allowed every country bar ourselves and Germany to devalue, thus increasing the prices to their farmers. It must be right, especially if we want increased investment to keep British agriculture where it is, to ensure that our farmers receive at least the average increase received by other European countries. I hope Her Majesty's Government will be able to achieve those points.
9.28 p.m.
Lord Bishopston: My Lords, I thank the noble Lord, Lord Mottistone, for introducing the debate, which covers the 1982–83 farm proposals and the guidelines for European agriculture. It has been the habit tonight for noble Lords to delcare their interests. Although my family has been associated with agriculture

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for several centuries, I am not particularly involved, although I can say with considerable pride that I am in touch with the grass roots, so to speak, and that is most important.
The whole House is grateful to the noble Lord, Lord Mottistone, and my noble friend Lord Cledwyn—and of course to the Select Committee—for the detailed work they put in on the report, especially as it was done at very short notice and therefore under great pressure. We are grateful to the individual members for a report of very high quality indeed, presented in a concise form. Such effort was essential to produce a topical report, up-to-date, as it is, with last-minute proceedings from Brussels, and we are all appreciative of their endeavours, for the comprehensivenesss of the report and the quality of its recommendations.
Like other noble Lords, I have read the report in some detail and of course considered the other relevant papers. During the debate noble Lords have detailed their views and I was particularly interested in the contribution of my noble friend Lord Blease who, as always, ensures that the voice of Northern Ireland is heard. The presence of the noble Viscount, Lord Brookeborough, reminds me of the visits which my noble friend Lord Peart and I made over a number of years to Northern Ireland when we were Ministers, and I assure the people of Northern Ireland of our continued interest and support. It was nice to hear the Irish accent after hearing the Gaelic accent of my other noble friends from north of the border.
After this long debate—
Lord Mackie of Benshie: My Lords, it is not Gaelic; it is an entirely different accent. Every accent that your Lordships have heard from Scotland has been that of the Lowland Scot.
Lord Bishopston: My Lords, I am grateful to my noble friend for scotching that rumour. After a long debate noble Lords have naturally touched on the main points of concern, and I do not wish to repeat them; I am sure that your Lordships will be grateful to hear that pledge. I am bound to say that I agree with the Committees' conclusions and its 15 points, and i shall refer to some of them which I think are of particular interest and merit. The report rightly says:
"The way in which agricultural policy develops is clearly of great significance to the budget".
I consider that that claim is important because it should indicate the need to reform the common agricultural policy as soon as possible—if further discontent is not to grow—not only to get a reasonable budget, but to eliminate some of the quite unjustified farming and food policies on the way.
The Select Committee is to be praised for the way it did its job and for seeing the objectives so clearly. Guidelines are very important, as is the 5-year horizon, which will help towards longer-term planning. This is so essential to farming because we all know that confidence is the very basis of a successful agricultural industry. It is essential in this process to establish the guidelines with the CAP, as the report insists, adapted, as the report states, to the new realities of both general economic conditions and the agricultural sector itself, while re-examining all the time the circumstances which have changed rather radically in the past 20 years.
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The guidelines detailed in paragraphs 7 and 8 of the report are I think very realistic, but they need to take account of other factors, such as the conflicting interpretation of the common policies by individual member states.
Having made that personal speech note, I saw that the Select Committee came to the same conclusion, when in paragraph 10 it concluded that,
"The danger is that nothing acceptable will be achieved because it can never completely satisfy everyone".
This is one of the real dilemmas of the Community, despite the fact that we all say that we have a common interest in making the Community work.
Going back to the claim that the general economic situation has changed, I would say that we must recognise the effects of inflation, which are still very high in the United Kingdom and in the Community as a whole. We are indebted to the Select Committee and to those who gave evidence, including many bodies which have great experience and knowledge of the industry and of CAP problems.
The last Labour Government were blamed on occasion for the difficulties that they faced through their constructively critical Common Market attitude. The present Government's relationship with the EEC is no better, and I think some would say, having read the tapes tonight, far worse, since the United Kingdom, like other member states, is rightly forced to fight for its own position. Therefore, one asks the question: where does the fault lie: I think that it lies basically in the structure of the CAP and in its objectives. The fact that over 70 per cent. of the overall EEC budget is represented by the agriculture and food sector of the EEC distorts it further. The 16·3 per cent. average increase in the Common Market farm prices this year is recommended by COPA. I was very pleased to see that although the Brussels Commission is recommending a 9 per cent. average increase, in Brussels on 15th and 16th February our Minister urged, I think quite rightly the need to have prudent price increases on products, especially those in surplus. I think that it is the high pricing policy which has contributed to surpluses.
The farm price proposals fail to deal adequately with the problem of costly surplus production in the Community. The problem of surpluses also stems from the CAP structure. Farmers are rightly guaranteed a minimum price for much of their produce, and in order to prevent the market price falling below this level, the EEC buys food and stores it until price rises justify it being again put on the market.
Much of the criticism of the CAP arises because of the surpluses and the intervention policies and so on, which are necessary at times, but which are also in some ways encouraging the wrong trend. If surpluses cannot be disposed of within the Community, then, of course, we know they can only be sold at a discount outside the Community, where, as we all know, the food prices are lower. So the Community consumers are subsidising the non-EEC consumers, who pay lower prices while the EEC consumer—and that, of course, includes the British housewife—has to pay much more for food. Then, of course, we also pay the levies when we import cheaper food from abroad, so the British housewife comes off badly in both instances.
Lord Mackie of Benshie: My Lords, would the noble Lord permit me to interrupt him: Would he suggest that the people of Poland are better off than the people of this country? Would he not think that the people of Poland might prefer to have surpluses?
Lord Bishopston: My Lords, I think I can comment on the noble Lord's view in a moment. The point is, of course, that we need some surpluses, but there are excesses which are an abomination to the Community policy itself.
The situation with milk needs review. As we all know, the United Kingdom has a very efficient milk production and distribution system, especially in herd size and in productivity; and, of course, the reprieve of the Milk Marketing Board a year or two ago shows that even the Community appreciates the productivity and efficiency of our milk producers. But the United Kingdom milk producer is being discriminated against, as the Committee claims, as the co-responsibility levy, which is supposed to discourage over-production, favours the small EEC farmer, as we know, to the United Kingdom's disadvantage. This underlines one of the grave defects of the CAP, which should be directed to the encouragement of the efficient producer in any sector and to the discouragement of the least efficient. If we do not do that, and if we have high prices, then, of course, we get the surpluses about which we complain. Paying high returns to keep the less efficient farmer in business only adds to the cost and creates the surpluses, as I say. The elimination of the less efficient producer is, of course, a matter for social budgets, and should not be a cost to the overall farm budget; and we have made this point many times with our European colleagues.
Recently, when we have been discussing agriculture, there has been some extensive publicity about EEC surpluses, including wine lakes, butter mountains and so on. I stress the point made by the noble Lord, Lord Mackie of Benshie, that we need reasonable food reserves, but there is no justification for excessive surpluses—and it is no good, on occasion, trying to explain that away. I think I would say very briefly on this that the making of molehills out of EEC butter mountains has helped to put the CAP on the slippery slope, and action is still needed to deal with this particular problem.
Import levies, as we know, raise the prices of imported foods to the higher EEC price levels, so let no one claim that the EEC food prices are unnecessarily high. As we can, as we know, produce only about 60 per cent. of our food, the United Kingdom depends on imported food. Our EEC budget contribution has been high as the number engaged in agriculture is relatively small, being, as we know, about 2·7 per cent., compared with the figure of over 9 per cent. in the rest of the EEC. So what we get in agricultural support is relatively lower but we have yet to give the United Kingdom farm-worker the kind of reward or return which is justified bearing in mind the way in which he has contributed to
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productivity. We often say that people should only be paid in relation to what they can produce. The farm-worker is one of the most productive workers in this country, and it is about time that we took that into account in making our proposals.
Of course, we need to support our own agricultural industry to ensure its efficiency and competitiveness. When we entered the Common Market we went through a period of transition. There were the problems connected with the beef sector. I think it was due to the initiative of my noble friend Lord Peart, who was the Minister of Agriculture at the time, that the EEC, after a long period of disagreement, established what became known as the Peart premium, now called the variable premium and referred to in our report. How right the Committee is to recommend, in Recommendation 15, that the United Kingdom variable premium for beef should be a permanent feature of the beef régime to keep down the price of beef to the consumer.
It should not be, as we know it is, a matter for annual bargaining in relation to the budget and price proposals. Having read the Hansard of another place, I can see there has been some misleading allegations about Labour's agricultural policy. It is as well to remember, as, indeed, do many farmers, that it was Tom Williams who, as Minister of Agriculture in the crusading post-war Labour Government, laid the foundations of British agriculture with the 1947 Agriculture Act. It is our intention to work for the continued efficiency, viability and prosperity of British agriculture and food production and of all who work in it as employees or employers with the main interest of the consumers very much in mind, regardless of our future with the EEC.
I was interested in the passing comment of the noble Lord, Lord Stodart, when he spoke about Euro-jargon. Sometimes we are in danger of not seeing the wood for the trees. We are confused with Euro-jargon, talk about MCAs, green currency, intervention and surpluses, export restitutions, sluice gate prices; we say with some truth that the world price plus the variable levy equals the threshold price, that the EEC price plus the export levy equals the world price. We cannot get away from these facts. I am not saying that these details do not matter but we must get them into perspective. Like agriculture and food production, they are but a means to an end and we must not lose sight of that fact.
The British agriculture industry has a great deal to contribute and as we go deeper into the micro-technological age and the era of biotechnology we must harness science to meet the needs of the millions who, the Brandt Report insists, desperately and urgently need what we can provide. The time has come when we must endeavour to lift the sights of the European Community to the wider horizons which must embrace the needs of a hungry world. There is no time to lose in that.
9.43 p.m.
Earl Ferrers: My Lords, I should like to go back to the beginning when my noble friend Lord Mottistone declared an interest as a food processor, the noble Lord, Lord Mackie of Benshie, declared an interest as a farmer, and I would declare an interest in the fact that I am a farmer and a consumer. I like to think that I produce some of the food and eat rather less of the food that is produced in this country. In this debate, we are all concerned to see that the right course is taken for British agriculture and European agriculture. I liked the final words of the noble Lord, Lord Bishopston. I liked a number of his words but particularly the final ones where he said that we must try to lift our sights above the problems immediately of Europe and think about those parts of the world which are less fortunate than we. In that way, British agriculture, expertise and technological know-how has a great part to play in helping other countries develop their own agriculture.
The debate is timely because it gives your Lordships the opportunity of giving your own advice and guidance as to how the Government might, could and should react in the common agricultural price fixing negotiations before they are determined and while they are, as they are, still in process of being negotiated. It has a somewhat inhibiting effect on a Minister replying to a debate because a negotiation is a negotiation and this means that results can emerge which are acceptable to all and which seek to meet the sometimes differing requirements of member states. But it is useful for us to get to know what your Lordships see as the negotiating stances and objectives and the things which ought to be done.
I was interested in the experiences of the noble Lord, Lord John-Mackie, with members of the European Parliament. He said that he wished we could do away with green pounds, MCAs and so on and that these ought to be irrelevant. In a totally organised situation they would be an irrelevance. They were only devised in order to take account of excessive movements. Of course, so long as currencies remain in a position or are apt to remain in a position of periodic turbulence, it is very difficult to see how they can be done away with.
I was sorry to hear my noble friend Lord Stodart attack the processors. He is normally such a reasoned person. I thought that momentarily his reason had left him—at least on that particular subject. He said the interests of the producers and processors were diametrically opposed. With the greatest of respect to my noble friend, I disagree. The interests of processors, consumers and producers are all the same though there may be different inflexions upon them. It is no different from buying a motor-car. The garage depends upon the driver and the driver upon the garage. If the garage does not do the work properly they will not have the driver's custom. If the driver has no use for the product of the garage, he will not make use of it.
I would go along with the noble Lord regarding the need for simpler language. That not only applies to the European Community but to a lot of other things. If my noble friend has ever gone through the disagreeable experience—and no doubt being a prudent man, he has—of making a will, he will know that he has not the slightest idea of what he has said once the lawyers
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have their hands on it. So it is with doctors, dentists and scientists. They have a precise jargon of their own which is totally indecipherable to anyone else who is not familiar with it. But I agree with him in his sympathies.
We have argued as a Government for some time—and indeed the European Commission have argued—that the Commission should produce medium-term projections of how production and consumption are likely to develop which could act as background to the annual price fixing. The Commission have adopted this approach in the guidelines and have made projections up to 1988. They have recommended a number of measures which should be taken to ensure that production is continued within reasonable limits, bearing in mind the likely growth of demand and other calls on Community production.
The Government support this approach because the time has clearly come when the Community must take action to contain the cost of support in surplus sectors and to indicate to producers that an unlimited guarantee is no longer possible. Despite the criticisms, the CAP are enabling British agriculture to make a growing and significant contribution to our own economy. The Annual Review White Paper shows that in 1980 the United Kingdom was 75 per cent. self-sufficient in those foodstuffs which we can grow here, as opposed to 61 per cent. just before our accession to the Community. More recently, our self-sufficiency for all foodstuffs increased from 53 per cent. in 1978 to 60 per cent. in 1980, and we calculate that this improvement was worth some £900 million extra to the balance of payments in 1980 alone. That is a very substantial improvement.
In 1979, of all the FEOGA guarantee expenditure the United Kingdom received back about 5 per cent. In 1981, this amount doubled, so we now receive back 10 per cent. For all these reasons, the Government believe that our aim should be to reform the common agricultural policy and to make it work even better.
The noble Lord, Lord Mackie, referred to the relationship between food prices and agricultural prices, and he was right to do so. I wonder whether I may put this in a different way because, during the period from December 1978 to December 1981, which is a three-year period, retail food prices rose, as the noble Lord, Lord Mackie, said, by 37 per cent. Some 24 per cent. of this was attributable to the rise in labour and other costs and the margin of processors, distributors and retailers. Only 13 per cent. was due to a rise in the cost of basic products in those three years. That is the measure of the effort which agriculture has made in the attack on inflation, and it is a measure of the benefit which housewives have received even from the processors as well, which the noble Lord, Lord Mackie, may be disappointed to hear. But the fact is that, while the retail price index has increased so much, the price of food has increased by less and the price of the actual article of food which goes into the product has increased by even less. When you consider that inflation and recession have been caused by energy and that agriculture is a source of energy as well as a product of it, that is a pretty remarkable achievement.
The noble Viscount, Lord Sidmouth, referred to the glasshouse industry and said he was worried about

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Dutch gas. I know the glasshouse industry has had a very difficult time and the horticultural industry has had one too. We are concerned to see the gas problem resolved properly and permanently and we have continued to press the Commission for a solution on this subject. It is hoped that they will shortly be able to find a permanent solution. Meanwhile assistance up to the value of £4 million is being provided in the current year. I accept, of course, the noble Viscount's desire for an early solution to that problem. That is what my right honourable friend the Minister of Agriculture is urgently doing with the agreement of his fellow Ministers in Europe.
The Commission's price proposals for 1982–83 recommend price increases averaging 9 per cent. and a 4·4 per cent. revaluation of the green pound. The Government believe that there should be lower increases for products which are in surplus, and that has been our line in Brussels. We have also made it clear that we reject the Commission's present proposal for a revaluation of the green pound—a proposal which would mean that the United Kingdom's support prices would go up by less than 4 per cent., with severe consequences for incomes and the future levels of agricultural production, while those of others in the Community would of course rise by nearly twice as much.
The Government have considered the price proposals in the light of the guidelines document, and this has been the sub-committee's approach too. Some aspects of the proposals clearly reflect the spirit of the guidelines, in particular the proposals for production thresholds for some of the main sectors and for lower relative price increases for cereals which follow naturally from the guidelines. The Government agree with the sub-committee that the Commission has not gone far enough, especially in its proposals for production thresholds.
My noble friend Lord Mottistone said that the Commission had provided increased prices every year since the United Kingdom joined the Community. I thought that was a somewhat unfair inference, because of course we joined the Community at the very moment when oil prices took off and when inflation took off—
Lord Mottistone: My Lords, I hope that my noble friend will forgive me. Perhaps on reflection he would agree that I did not say the Commission had produced increased prices every year since we joined the Community: I said that in every year since we joined the Community the Council of Ministers had added to what the Commission had produced—which is really slightly different.
Earl Ferrers: My Lords, I am grateful to my noble friend. I quite agree that I totally misheard my noble friend, and am glad to be corrected. We think there should be prudent price increases for products in surplus, and I would emphasise the word "prudent". We endorse much of what the sub-committee had to say on individual commodities. My noble friend Lord Mottistone—and I hope that I am not wrong again this time—said that there should be more of a feeling that it should be a food and agriculture policy as opposed to
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just an agriculture policy. But, of course, my right honourable friend has been pressing this point hard in the Council of Ministers to ensure that in fact prices do not rise out of all reason and thereby harm the consumers.
The cereals sector is expensive: it accounts for about 15·2 per cent. of FEOGA guarantee spending, or £1,209 million a year. The Commission's proposals aim to reduce this. For the second year running, support prices for cereals would go up by 2 to 2½ per cent. less than average, and the increases proposed less than cover inflation. In real terms, they represent not a freeze but a cut in prices for the second year running. The Commission proposes that, in future, support prices for cereals would be liable to reduction if the total quantity produced over-ran a pre-set target level of 119·5 million tonnes. These measures are designed to improve the balance between the cereals and livestock sectors, and to limit the cost to the Community budget of the cereals régime. We support the Commission's objectives, but have reservations about the details. In particular, we think that the proposed production threshold is too high.
We are opposed, also, to the Commission's proposal to increase the levy on brans. This would put up the cost of livestock feed, especially in Northern Ireland where, as we have been told only too clearly, grain prices are high and farmers rely on imported materials. It is not in the interests of the livestock sector or of the farming industry as a whole to reduce these imports or to put up their prices. We are, therefore, resisting moves to restrict these imports, except in the case of manioc, where we were very concerned about the budgetary implications of a high level of imports.
My noble friend Lord Brookeborough and the noble Lord, Lord Blease, quite rightly made special note of the position in Northern Ireland, which I recognise is a very difficult and a very delicate one. They both referred to the social problems which are connected with agriculture in Northern Ireland and with the high level of unemployment there at the moment. Since we took office, there has been agreement on a number of measures of specific assistance to agriculture in Northern Ireland, such as the agricultural development programme, which gives improved rates of grant in the less-favoured areas; enhanced aid for processing projects in the animal feed sector; doubling the suckler cow premium; the beef development programme; giving assistance with artificial insemination; beef performance testing; liming and first-time silage making.
These schemes qualify for assistance from Community funds, and further national funds were made available in 1981–82 which have helped to maintain jobs in the dairy and intensive livestock sectors. I do not say that these are all the answers that are required, but it is an indication of the fact that the Government are aware of the position in Northern Ireland. My right honourable friend the Secretary of State for Northern Ireland has also announced that he is making a further £6 million available in 1982–83, and we are in touch with the Commission on how that can be utilised. It is hoped that we shall shortly be able to give further details, and that this will further help the position in Northern Ireland.

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My noble friend Lord Brookeborough referred to the liquid milk position. Because only about 18 per cent. of milk in Northern Ireland goes into the liquid market, compared with about 50 per cent. in Great Britain, the higher returns from the liquid market do not help Northern Ireland producers as much as they assist producers in Great Britain. Northern Ireland producers are partially compensated for this disadvantage by a higher liquid price and this, in turn, is offset by a consumer subsidy which is approved by the Commission, and which ensures that the retail price in Northern Ireland does not exceed the retail price in England and Wales.
Both my noble friends Lord Brookeborough and the noble Lord, Lord Blease, referred to the application for the alteration in the less-favoured areas régime. They are quite rightly concerned to see this area extended in Northern Ireland. The work has been done and preparations are now being made to present these proposals to the Commission. I would only remind my noble friend that the Government have never entered into any commitment to make more money available for any increased area which might come about as a result of the new delineation of the less-favoured areas. But I accept the urgency for this to be done and we hope to do it as soon as possible.
Many noble Lords referred to the milk position and it is quite right—and I agree with the noble Lord, Lord Collison—that the surplus of milk in the Community means that a proper price policy and effective measures to tackle the surplus are essential. United Kingdom dairy farmers need some increase in the support price to offset the pressure on their incomes. The basic co-responsibility levy is certainly not the answer since it applies to all producers, regardless of whether they are adding to the surplus. It increases the price and it so reduces the consumption. The noble Lord, Lord Bishopston, my noble friend Lord Stodart of Leaston, the noble Lord, Lord Collison, and my noble friend Lord Forester, in a remarkably short speech which I would have wished to emulate but which unfortunately I am unable to emulate, said that they were concerned about the basic levy on the first 60,000 kilogrammes of milk. We are opposed to this proposal as it favours other member states whose herd sizes are smaller than our own and discriminates against the United Kingdom which has an efficient industry and a herd size almost four times the Community average. I agree with the noble Lord, Lord Bishopston, that there should not be penalties for efficient production.
Obviously the Government are concerned about the financial implications of the Commission's proposals. Agriculture's share of the Community budget has fallen from 80 per cent. in 1978 to 66 per cent. in 1981. We are anxious that this progress should be maintained. The Commission claim that their proposals will not lead to any increase in agriculture's share of the budget, but it is the Government's view that Community agricultural expenditure should grow more slowly than the Community's own resources in 1983. We wish to keep our eye closely on that.
The noble Lord, Lord Walston, said that he thought agriculture should not become a political football and
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that the decision on common agricultural price fixing should not necessarily be involved with the budgetary position. I would merely reiterate that throughout the discussions within the Community—on the mandate of 30th May—it has been agreed that work on all three chapters (the common agricultural policy, the development of our other Community policies and the budgetary problems) must go forward in parallel because all three chapters are interrelated. That, in our view, remains the position and that is why decisions on the common agricultural policy can be taken only in parallel with decisions on the budgetary problems.
I believe that the Government's approach to the guidelines and to the price proposals is very similar to the sub-committee's. We think the guidelines are on the right lines. Our main criticism of the price proposals is that they do not go far enough in implementing the principles which are set out in the guidelines. We have already developed this point at the Council of Agriculture Ministers in February, and again earlier this month, and we shall continue to do so, with a view to securing a settlement which meets the needs of our industry, consumers, processors and distributors.
Agriculture is a great industry which we wish to see succeed, not just for those engaged in it but for the nation as a whole. The sub-committee's report provides much welcome support for our negotiators. The Government are most grateful to the sub-committee for the work which they have done and to your Lordships this evening for the contributions which have been made. They will be taken very seriously into account because I know only too well of the conscientious diligence with which the sub-committee carry out their hard work.
10.4 p.m.
Lord Mottistone: My Lords, it only remains for me to thank all noble Lords who have taken part in the debate. I am most grateful to the members of the subcommittee—and also to those noble Lords who are not members of the sub-committee whose contributions have been particularly valuable and enlightening. My thanks go also to the many noble Lords who made nice remarks about me. I do not deserve it. But it was very kind of them to do so.
May I endorse my noble friend Lord Brookeborough's thanks to our clerk, to our specialist advisers and to the printers if not to the publishers (I am never quite sure about that). May I also thank the secretaries who worked very well for us in the background and also the shorthand writers who at times have been very hard pressed in taking down the evidence.
The hour is late and my noble friend the Minister has already commented on the points made by individual speakers. I should like to mention two points only. First, I entirely agree with the noble Lord, Lord Stodart of Leaston, on the need for jargon not to be used. We have done something about that in that we are providing a glossary in Volume II, which I hope the noble Lord will get in addition to Volume I. We would have liked to include it in Volume I, but printing pressures prevented that.

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To the noble Lord, Lord Blease, I will say that there is no mention of Northern Ireland conclusions because your Lordships will notice that we took out Northern Ireland and the United Kingdom as being separate from the rest. We were trying to produce a report that would be of use to the Community as a whole. And we did not want to highlight national interests, as it were, except to pick out special points which have a lot of attention paid to them. I would like to suggest that the amount of time given over to Northern Ireland in the speech made by my noble friend the Minister was out of all proportion. I cannot say that—my wife would never forgive me. Of course I do not mean that my noble friend's remarks were out of all proportion to what Northern Ireland deserves. It is a real reflection of the great work which my noble friend Lord Brookeborough puts in to make sure that Sub-Committee D never forgets Northern Ireland.
My noble friend Lord Brookeborough rather ticked me off for not being brutal to the Minister. I do not think I needed to be brutal, and, of course, I never wanted to be brutal because, if I heard him aright, my noble friend the Minister endorsed a great deal of what was said in our report and indeed will use the report to advise his right honourable friend the Minister in how to fight the battle in Brussels. If I could pick out one thing from the general debate, it struck me that all of us—including the farmers—agree that 9 per cent. is about the maximum there ever should be. It was also noticeable that, on the whole, we did not talk about revaluation. I believe we would like the message to go to the Minister that 9 per cent. is the maximum—although some of us would like it to be less, it is true—and that revaluation, as my noble friend said, is not something that we would support. I hope that my noble friend will convey these messages. Perhaps this time, this year, with a little question mark in the table as to the Council of Ministers' response to the 9 per cent. proposal by the Commission, it will be equal to and not at least two percentage points above, as it has been in most previous years.
On Question, Motion agreed to.