Lords Sitting of 27 July 1983

Preamble
The House met at half-past two of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Chichester): The Lord Chancellor on the Woolsack.
The Lords following took and subscribed the Oath or made the Solemn Affirmation:
Janet Baroness Lee of Asheridge.
Robert Alexander Earl of Crawford and Balcarres.

Clerk of the Parliaments
On consideration of the letter from Sir Peter Gordon Henderson, KCB, announcing his retirement from the office of Clerk of the Parliaments:
The Lord President of the Council (Viscount Whitelaw): My Lords, shortly before the dissolution of the last Parliament, my noble friend Lady Young—then Leader of the House—read to the House the letter in which Sir Peter Henderson announced his intention of retiring from the office of Clerk of the Parliaments with effect from the beginning of the summer Recess. My noble friend said then that an appropriate opportunity would be afforded to the House to pay tribute to Sir Peter's services, and it is in order to provide that opportunity that I now move to resolve:
That this House has received with sincere regret the announcement of the retirement of Sir Peter Gordon Henderson, KCB, from the office of Clerk of the Parliaments and thinks it right to record the just sense which it entertains of the zeal, ability, diligence, and integrity with which the said Sir Peter Gordon Henderson executed the important duties of his office.
As so often in recent weeks, I feel personally very diffident. The great honour and privilege which I feel in proposing this Motion as Leader of your Lordships' House is tempered by my own inadequacy as a new boy to speak from experience of Sir Peter's outstanding qualities. Yet in a curious way I have a very special reason to be grateful to him. Having become Leader without any previous experience of your Lordships' House, I have had during the past six weeks to rely especially heavily on Sir Peter's help and advice. I have quickly come to appreciate what an important part the Clerk of the Parliaments plays in the work of this House, and what great qualities Sir Peter has brought to his service in that office. It has therefore been no suprise to me to learn how warmly regarded and how highly respected he has been by your Lordships in all parts of the House.
Sir Peter entered the Parliament Office nearly 30 years ago after having served in the second world war. Naturally it is a matter of personal satisfaction to me that he was wise enough to be a member of what a jealous friend of mine recently described as "the Scots Guards mafia". But I know from my own regimental sources that Sir Peter served with very great gallantry in Italy when, as the House knows, he was most severely wounded.
In 1960, Sir Peter was assigned to take over the duties of Private Secretary to the Leader of the
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House—at that time my noble friend Lord Home of the Hirsel—on the death of Sir Charles Hendriks, who had held that post for many years. Thus began the now well-established convention whereby Clerks are seconded to this service from the Parliament Office, bringing to it as they do a knowledge of parliamentary procedure and the conventions of the House, and returning to the Parliament Office with an understanding of the practical aspects of the organisation of parliamentary business—and perhaps I should add of dealing with some of the complicated personalities involved. That this arrangement has worked so much to the advantage of the House is due in very large measure to the firm foundations laid by Sir Peter.
In 1963 Sir Peter returned to the Parliament Office as Clerk of Public Bills—a post which he filled with distinction for some 11 years. In 1964, soon after becoming Clerk of Public Bills, Sir Peter began his service at the Table of the House as Reading Clerk. His wise knowledge and experience of the legislative process was put to good use from 1973 to 1975 when he served as a member of the Committee on the Preparation of Legislation under the chairmanship of my noble friend Lord Renton.
In 1974 Sir Peter became successively Clerk Assistant and Clerk of the Parliaments. The nine years during which he served as Clerk of the Parliaments have witnessed a number of changes in your Lordships' House. It has become more complex in terms of its party composition. There has been a significant increase in the length of sittings and the size of the active membership. Perhaps most remarkable has been the development of the committee activity of the House. It is easy to forget that 10 years ago there was very little such activity. Now, the European Communities Committee and the Science and Technology Committee absorb a large amount of the energies and resources of the House, producing reports of outstanding quality that have done much to enhance the reputation of the House. This successful development owes much to, and reflects great credit on, Sir Peter's leadership and inspiration.
From my own short experience, reinforced by what I have learnt from noble Lords with much greater experience, it is clear that Sir Peter has been an outstanding servant of the House who has combined to an exceptional degree a broad appreciation of the interest of the House to which he has devoted his life with a capacity for taking pains over detail, and in particular for going out of his way to help all Members of the House. One particular matter in which Sir Peter has taken a close interest has been the conservation and restoration of the Palace of Westminster. A monument to his close attention is the presence of the figures of Justice and Mercy flanking the statue of Queen Victoria in the Prince's Chamber. I am told that for many years these figures were stored away, and that it was largely due to Sir Peter's enthusiastic efforts that they were replaced in position during his time as Clerk of the Parliaments. It is pleasant to be able to record that only last week the figure of Justice was completed by the replacement of the scales which previously had been missing from her hand.
It is a most happy coincidence for me personally that Sir Peter and Lady Henderson have a house not

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far from my own home in Cumbria. I hope that we shall see more of them there, for I do not need to remind your Lordships that of course there is no better part of the country. Equally, I know that their many friends in this House will wish to see them frequently in London. May I conclude by offering warm good wishes to Sir Peter and Lady Henderson, and to their family, for a long and happy retirement.
Moved to resolve, That this House has received with sincere regret the announcement of the retirement of Sir Peter Gordon Henderson, KCB, from the office of Clerk of the Parliaments and thinks it right to record the just sense which it entertains of the zeal, ability, diligence, and integrity with which the said Sir Peter Gordon Henderson executed the important duties of his office.— (Viscount Whitelaw).
2.40 p.m.
Lord Cledwyn of Penrhos: My Lords, in warmly supporting the Motion I would say that it is a real pleasure to follow the noble Viscount in paying tribute to Sir Peter Henderson. I have of course known Sir Peter for many years in the several posts which he has held in this House, but that was as a distant observer who came from another place to listen to a debate, or to visit a Minister or a friend, or both. But it was not until I became a Member of this House that I began to appreciate his great worth. The noble Viscount has enumerated his qualities and described his long and distinguished service.
I believe it to be the unanimous opinion of your Lordships in all parts of the House that Sir Peter takes his place among the great Clerks of the Parliaments. There is a sense of loss at his departure which I have not often met with in public life. I believe this to be due to two qualities. The first was the way in which his intellectual gifts enabled him to fulfil the demands of his high office. He served successive Lord Chancellors with distinction; he served Ministers and Shadow Ministers with impartiality; and he served individual Members of the House with thoughtfulness and courtesy. His second great quality was his willingness at all times to make himself available to everyone who sought his assistance and advice; and his personal kindness has been appreciated by us all.
It is the combination of these attributes which has gained for Sir Peter the respect and affection of all Members of this House. If I say that in peace as well as in war he showed courage beyond the call of duty, I know the House will agree. Sir Peter Henderson is a man for all seasons, and we are proud to have had him as our Clerk of the Parliaments. We now wish him and Lady Henderson a long, happy and well-earned retirement.
Lord Byers: My Lords, it is with great pleasure that I rise to support this Motion, to pay my tribute and that of my colleagues to Sir Peter Henderson, and to thank him for all the help and advice he has given us during the years he has been Clerk of the Parliaments. He has always been immediately available. He is the safe keeper of many confidences. He has been particularly helpful to the smaller parties and to individual Members. He has welcomed innovations which have been proposed; and, what is more, he has ensured that
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they have worked effectively. He has contributed immensely during his term of office to the improvements in our practices and procedures, both in the House and behind the scenes, many of which he himself inspired.
We shall miss the twinkling of his eye, particularly when he was contemplating some minor political mischief, which was often the case. We are indeed fortunate to have had such an outstanding servant of the whole House during his period of office. We wish him and Lady Henderson a tranquil, enjoyable and lengthy future.
Lord Diamond: My Lords, we on these Benches are very anxious to be associated with the richly deserved tributes paid to Sir Peter Henderson. There is little one can add, having regard to what has been said. I would just say how extraordinary I have found it, in the 13 years in which I have been privileged to be a Member of your Lordships' House, that on every occasion when one sought his help it was always made available and at very short notice. His advice was as constructive in content as it was simple in expression and he never let one leave his office with a feeling that one had possibly troubled him unnecessarily. Today we part with a great man, a man whose massive intellectual powers we have learned to respect and whose modesty of demeanour we regard with affection. We wish him well; we wish his lady well; and we shall not forget the great help and the great integrity with which he has served your Lordships' House.
Baroness Hylton-Foster: My Lords, this is one of the occasions when I can speak on behalf of the Cross-Bench Peers, as we should all wish to join in the tributes to Sir Peter Henderson and to express our appreciation for his services. As the Cross-Benches have no organisation, secretariat or records, they are constantly in need of information and guidance. Certainly we have frequently turned to the Clerk of the Parliaments for advice and have always been rewarded with the fruits of a wise, well-stocked mind, given in exquisite courtesy. Though his manner is modest and self-effacing, he seldom left one in any doubt about the proper course to follow. We hope he and Lady Henderson will enjoy his years of retirement, and that sometimes he will reflect on the many Members of your Lordships' House who have cause to remember him with gratitude and affection.
Lord Home of the Hirsel: My Lords, I well remember the day when Sir Peter first took office as Clerk of the Parliaments. I would add a few words of gratitude for the unfailing kindness he showed to me all through the years and to every Member of this House. He has served Parliament and this House with total loyalty, and I am old-fashioned enough to believe that loyalty is still one of the greatest of the virtues. I should like to add my good wishes to him and to Lady Henderson.
The Lord Bishop of Derby: My Lords, some of your Lordships have commitments which make it very difficult for you to play a regular part in the affairs of this House. All Bishops are in that position because of our duties elsewhere. It is impossible for us, unlike others of your Lordships, to have a weekly meeting,

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and that makes us all the more dependent on the work of the professional officers of the House. Among them over the last nine years Sir Peter Henderson has been pre-eminent. The Clerk of the Parliaments rehearses Bishops before their unheralded introduction as Members of the House. He sometimes has to instruct new Bishops about the right way to say Prayers. I had received correction before Sir Peter entered on the office he is now leaving, but, like others, I have known his numerous acts of personal kindness. He has enabled the Bishops as a whole to play their part in the business of the House with the greatest possible ease in our particular circumstances.
He has of course shown the impartiality and integrity of any great public servant. We who sit on these Benches are able to see the faces of the Clerks much more easily than most Members of the House. There has never been on Sir Peter's face the slightest movement when the House has become its most animated, and always he has shown the appearance of the greatest possible interest when it has been at its most anodyne. Even at those times he must have acquired a vast collection of recondite knowledge which we hope will give him many entertaining and productive hours during his retirement, without, we hope, spoiling the pleasure that Lady Henderson is also to have in his retirement. We should like to join our expression of thanks to the general appreciations which have been expressed.
2.50 p.m.
Lord Shackleton: My Lords, I rise not so much as a former Leader of the House but as one of the surviving members of the class of 1958—the first batch of Life Peers. I see here the noble Baroness, Lady Elliot of Harwood, the noble Lord, Lord Boothby, and the noble Baroness, Lady Wootton of Abinger, and others. We arrived at the time of Sir Charles Hendriks, who, so far as we knew, had been here since the days of Lord Crewe and possibly Lord Curzon. He was a man of such great authority that when he told me, when I was a very new Peer, to hurry up and run or I would miss my opportunity of voting for the Opposition we knew we were in the presence of authority.
Then came this brilliant decision to appoint to a sensitive political post a Clerk of the House who was uniquely fitted to enable the usual channels to work. It is one of the strengths of your Lordships' House that, even at a time when the usual channels are not always co-operating officially, my noble friend Lord Beswick and I both feel we owe a debt of gratitude to the Clerks who have followed in the steps of Sir Peter Henderson. There have been some difficult times in the days of the Clerks, but Sir Peter was always there with wise advice and friendliness and, with the personal courage to which the Leader of the House referred, was able to help us. It is striking that the same quality exists among the Clerks, sometimes with a little touch of arrogance; but there was no arrogance in Sir Peter Henderson. We are all deeply grateful for what he has done for us. He became, with Lady Henderson, a friend of mine, and we wish him a very happy time in that delectable part of the country to which the Leader of the House referred.
Lord Mowbray and Stourton: My Lords, as a Peer who has possibly known Sir Peter longer than any other Peer in this House, as he and I were freshmen at Oxford some 42 years ago, it is splendid to listen to the wise and kind words which have so rightly been said about him. But I am pleased to say that there was a younger Sir Peter whom I knew, but whose advice was not always so wise. I can remember going to dine with him one day at Magdalen. The night wore on and I said that I would be late in getting back to Christ Church. He assured me that it was all right—"You know the way over the Cathedral, don't you, down into Tom?" I said I did. He said he knew the way out over the wall at Magdalen. He led me to the wall, where, he said, there was a lampost which had palings on it which stopped people from climbing down. I got over the wall and climbed down only to find the Dean of Magdalen at the bottom of the lampost. Sir Peter did not offer to pay the £1 which I was fined because I was late at Christ Church. But no matter.
Of course, I saw him occasionally during the war and, when I arrived here later, however small the matter I wanted to know about as a junior Whip, both in Opposition and in Government, I always found his advice far more useful than that of my superiors. Moreover, being of historic antiquated mind I always have a lot of historic antiquated questions. He showed considerable interest in answering my questions, and not only in answering them but in coming back one or two days later having done the research. He is a most remarkable man, who hides with such modesty under his delightful presence such a sharp mind, as has been said. I should like personally very warmly to support this Motion.
Earl St. Aldwyn: My Lords, may I interrupt for just a moment? I have had the privilege of being in your Lordships' House when we have had two really great Clerks of the Parliament. One went by the name of Baddeley. I am afraid not many of your Lordships were here in this House when he was the Clerk. He was a brilliant Clerk and, although it was in the days of hereditary Peers only, and therefore his task was very much lighter, the only man who compares with him is Sir Peter Henderson, who has had a much more difficult task to deal with. All that has been said is totally true.
My noble friend the Leader of the House said that Sir Peter was the first Clerk to come from the Parliament Office to be secretary to the Leader of the House, but he was, in fact, first Chief Secretary to the Leader of the House and the Chief Whip. When he came to the Whips' Office there was no organisation at all, and it is due to Sir Peter Henderson that the system which he worked out at that time has stood the test of time and has remained virtually unchanged until today. I wish him well and a peaceful and happy retirement.
Lord Peart: My Lords, perhaps I may just add a few words and say how I have enjoyed already what has happened. We are all pleased that Sir Peter is here. Tributes have been paid from the many of us whom he helped and I hope that help will continue.
Baroness Elliot of Harwood: My Lords, as the noble Lord, Lord Shackleton, pointed out, the year that the noble Lord, Lord Shackleton, and I became Life Peers

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was the first year of the Life Peerages. I think that the noble Baroness, Lady Wootton, and I are two of those remaining of the original ones. I should like to say that we found Sir Peter enormously helpful. In those days the arrival of women in the House of Lords was very well received by many people but there was a certain suspicion, let us face it, which we had to live down. Sir Peter helped enormously. No one could have been kinder and no one wiser in his advice. I am sure I am speaking for all noble Baronesses who have joined us when I say how much we appreciate what he has done, and that we very much hope he will have a very happy retirement and that we shall see him from time to time in this House, if not in the Chamber.
Viscount Ingleby: My Lords, may I say just a few words on behalf of the Members of the "mobile bench" in this House. It may not be generally known that Sir Peter is a paraplegic, and we regard him as one of ourselves. When we first arrived here—and I am sure I am speaking for all of us—we felt very apprehensive. Sir Peter put us at our ease right from the word go. He has always been most helpful and will always have a very special place in our affections.
The Lord Chancellor (Lord Hailsham of Saint Marylebone): My Lords, as I owe at least as much and perhaps more to Sir Peter as any who have spoken in this House over the years, perhaps it would be churlish if I were not to say something, if wearisome if I were to say a lot. Some of your Lordships will remember that for a brief period between 1960 and 1963 I was Leader of your Lordships' House and that, prior to that, I was Deputy Leader. During that period the office of Private Secretary to the Leader and Chief Whip, became vacant. With my noble friend Lord St. Aldwyn, the then Chief Whip, I was one of those jointly responsible for Sir Peter's appointment. Shortly after I had disclaimed my two hereditary titles, he moved back to the Parliament Office and since then has risen to the position from which he has now retired.
I do not want to weary the House with a catalogue of the innumerable occasions on which Sir Peter has earned my undying gratitude for the wisdom of the advice which he has given in one capacity or another and for the loyal co-operation and discretion with which he has served as a fellow labourer or ironed out my peccadilloes. We all owe very much to him, but I as much as any. I am happy to take this opportunity of joining with all the others who have paid tributes to him. We shall all miss him, but we wish him happiness and long life in his retirement, and his successor the like felicity in his new appointment.
On Question, Resolution agreed to nemine dissentiente; it was ordered that the Lord Chancellor do communicate this resolution to the said Sir Peter Gordon Henderson, KCB.
Then, the then Leader of the House having informed the House on 12th May last that Her Majesty had, by Letters Patent, appointed John Christopher Sainty, Esquire, to the Office of Clerk of the Parliaments, in the place of Sir Peter Gordon Henderson, KCB, the Letters Patent were read. The said John Christopher Sainty, Esquire, made the
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prescribed declaration (which declaration is set down in the Roll among the oaths of the great officers) in terms as follows:
"I, John Christopher Sainty, do declare that I will be true and faithful and troth I will bear to Our Sovereign Lady the Queen and to Her Heirs and Successors. I will nothing know that shall be prejudicial to Her Highness Her Crown Estate and Dignity Royal, but that I will resist it to my power and with all speed I will advertise Her Grace thereof, or at the least some of Her Counsel in such wise as the same may come to Her knowledge. I will also well and truly serve Her Highness in the Office of Clerk of Her Parliaments making true Entries and Records of the things done and passed in the same. I will keep secret all such matters as shall be treated in Her said Parliaments and not disclose the same before they shall be published, but to such as it ought to be disclosed unto, and generally I will well and truly do and execute all things belonging to me to be done appertaining to the Office of Clerk of the Parliaments."
After which he took his seat at the Table.

Reading Clerk and Clerk of Outdoor Committees
The Lord Chancellor: My Lords, I beg to move the Motion standing in my name on the Order Paper. In accordance with the Statement made by me on 12th May last, I have appointed Mr. Michael Addison John Wheeler-Booth to be Reading Clerk and Clerk of Outdoor Committees in place of Mr. John Christopher Sainty, appointed Clerk of the Parliaments. I therefore beg to move.
Moved, That this House do approve the appointment by the Lord Chancellor, pursuant to the Clerk of the Parliaments Act 1824, of Michael Addison John Wheeler-Booth, Esquire, as Reading Clerk and Clerk of Outdoor Committees of the House in the place of John Christopher Sainty, Esquire, appointed Clerk of the Parliaments.—(The Lord Chancellor.)
On Question, Motion agreed to, nemine dissentiente.

Unemployment: Comparative Figures With OECD Countries
3.5 p.m.
Lord Jacques: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government, if British industry has improved its competitiveness as much as they claim, why the percentage of unemployment in the United Kingdom is 4.4 points higher than the average for OECD countries when United Kingdom unemployment was only 0.4 points higher in 1979.
The Minister of State, Privy Council Office, and Minister for the Arts (The Earl of Gowrie): My Lords, until 1981 wages were increasing more rapidly in the United Kingdom than in other countries, our competitiveness fell substantially and our unemployment rose very steeply. Since 1981, however, we have regained a good deal of ground. Our competitiveness has recovered very substantially and our unemployment is now rising more slowly than in many other countries.
Lord Jacques: My Lords, I thank the Minister for that reply, but is he aware that from 1979 until the beginning of the present year the fall in inflation in the United Kingdom was only one point more than it was for the OECD countries but our unemployment was four points greater than for the OECD countries? Does this not indicate that had the Government used wisely all the measures available for restricting inflation, they would have achieved their objective without so much hardship for our people?
The Earl of Gowrie: No, my Lords. Unemployment has risen more in the United Kingdom than in other countries over the whole period since 1979 for two reasons: first, our problems were more deep-seated than theirs, and, secondly, if the United Kingdom wage bargainers had reacted more quickly to outside events in the period from 1979 to 1983 the rise in unemployment would have been less.
Lord McCarthy: My Lords, would the noble Earl not agree that on the three tests of our comparative employment performance we have got much worse in terms of the absolute level, the rate of increase and the size of our employed labour force? Does he not agree that in each one of these three ways the record is much worse than it was in 1979?
The Earl of Gowrie: No, my Lords. First of all the United Kingdom total labour force is at the very high end of those of our competitor countries, and secondly, as I pointed out in my original Answer, in the past 12 months OECD standardised rates show increases rather greater than ours.
Lord Ezra: My Lords, is the noble Earl aware of the fact that the consensus of economic forecasts is that the present high level of unemployment is likely to remain for at least another year and possibly two? In view of that very serious prospect, what are the policies of Her Majesty's Government to alleviate that situation?
The Earl of Gowrie: My Lords, my own judgment would be that very high levels of unemployment will remain throughout the Western countries for the rest of the decade.
Viscount St. Davids: My Lords, I am sure that the noble Earl will agree that unemployment on the European level is very understandable, but will he also agree that the extra unemployment that we have suffered is due to feather-bedding coming home to roost?
The Earl of Gowrie: My Lords, I think that the noble Viscount has put it most succinctly. I refer the House to the article in the Standard yesterday written by a member, or perhaps a former member, of the Labour Party, Mr Brian Walden, which pointed out that the protection of jobs costs more jobs in the longer run.
Lord Mackie of Benshie: My Lords, does the noble Earl's previous answer mean that the Government are content to see unemployment remain at the present level for the next seven years?
The Earl of Gowrie: No, my Lords. To recognise factors and economic forces at work in the Western world does not mean that one is satisfied with them.
Lord Beswick: My Lords, will the noble Earl not agree that whatever feather bedding there was, it was more than exceeded in damage by the degree of underinvestment? Will he not also agree that one of the most worrying things about the present situation is that on the one hand we have this high degree of unemployment and on the other hand the great degree of need in our society?
The Earl of Gowrie: My Lords, I certainly agree with the noble Lord, Lord Beswick, that investment is essential; but with all of his experience of industry, he will know that nowadays investment is nearly always to save labour and not to add to it.
Lord Mishcon: My Lords, while I appreciate, as I am sure does everyone, the art of the noble Earl the Minister in defending questions, may I ask him whether he can please be positive and answer the noble Lord, Lord Ezra, as to what are the Government's policies in order to try to keep down this dreadful unemployment?
The Earl of Gowrie: My Lords, as I indicated in my earlier answer, the Government's policies are to set a framework of sensible fiscal and monetary management, in order that the firms of this country can become more competitive in relation to those abroad. That will save jobs and generate more jobs.
Lord Morris: My Lords, does not my noble friend agree that investment in certain loss-making industries should not be dignified by that term?
The Earl of Gowrie: My Lords, as I indicated earlier, it is certainly the case that under successive Governments in this country—I make no party point here—there has been a tendency to try for the noblest of reasons to protect employment, but at the cost of a greater shake-out of labour later as we lose competitiveness internationally.
Lord Roberthall: My Lords, docs the Minister's reply to the previous supplementary question mean that the Government are indifferent to the effect of the exchange rate on competitiveness?
The Earl of Gowrie: No, my Lords; and the noble Lord will be aware that the exchange rate has become more competitive in recent months.
Lord Hankey: My Lords, in view of previous experience of this country in moving out of recessions when British industry has been terribly slow to get going, may we take it that the Government will be giving industry every possible encouragement, by abolishing, or removing, the obstacles which make it harder for business to progress? I am thinking of such matters as the special tax on motorcars, the poor communications with many of our ports, and the bad conditions in the ports, which make it hard for exports and imports to move. May we in general ask the Government whether they are really devoting every possible means so as to get industry going?
The Earl of Gowrie: My Lords, I take the point of the noble Lord, Lord Hankey, and it is the central thrust of the Government's policy to try to discipline and contain the very many and wholly legitimate demands on its own spending in order that more resources are available for industry. I am glad to say that there has been some encouragement here and that is why, as I said originally, the present figures for this country in comparison with our OECD competitors are very good.
Lord Spens: My Lords, will the noble Earl agree that the level of unemployment is directly linked to the total number of jobs available, and that with the rapid increase of technology the total number of jobs available is likely to decrease over the next few years, and therefore the level of unemployment is not likely to go down?
The Earl of Gowrie: My Lords, this is a very large question, and I do not know whether I can exchange ideas about this vital subject by means of question and answer. But certainly it would seem to me that if we do not proceed along the lines of greater investment in high technology, our overall wealth base will shrink, and that will not generate employment—rather to the contrary.
Lord Jacques: My Lords, is the Minister aware that there is a large body of competent economists which believes that the most important factor causing our unemployment is the selection of methods of controlling inflation used by the Government? Is this not supported by the very low rate of unemployment that we had in 1979 compared with OECD countries?
The Earl of Gowrie: My Lords, I think that the noble Lord, Lord Jacques, will have to concede that that same highly respectable economic opinion has been advised to nearly all Western Governments of widely differing political complexions—obviously I am thinking in particular of France—and that when put into effect the advice has not proved able to generate employment.

Madrid Conference on Helsinki Agreement
3.15 p.m.
Lord Brockway: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what were the conclusions of the Madrid Conference on the Helsinki Agreement for European Security and Co-operation.
The Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne): My Lords, the consensus necessary to bring the Madrid meeting to a close has not yet been achieved. We prefer to await formal closure before giving a final assessment. But the document agreed between 34 of the 35 participating states would stress the political significance of the Helsinki Final Act, add impulse to the CSCE process, and record a number of useful new commitments.
Lord Brockway: My Lords, I thank the Minister for that reply. There are many questions that one would like to ask. Will the Minister agree that a tribute should be paid to the non-aligned nations—in particular Austria and Switzerland—who saved the conference last year, for their contribution to the basis of the declaration, as well as a tribute to the Spanish host for his final complementary compromise? May I ask the Minister two questions? Will he give a full assurance that the Government will support the decision for a monitoring of military activities from the Atlantic to the Urals, including even NATO exercises in the Atlantic? Secondly, will he also give a similar assurance about the preliminary meeting to be held in October in order to prepare for the European disarmament conference in January?
Lord Trefgarne: My Lords, I certainly agree that the role of the non-aligned nations, and lately Spain, in the preparation of the final document has been most useful. As for the two points that the noble Lord put to me about the CDE conference, it is true that the mandate for that conference is included in the final document, and the Government certainly adhere to that.
Lord Shinwell: My Lords, may I ask the noble Lord how he can possibly regard anything emerging from the Madrid Conference as significant, in view of the Soviet Union's attitude towards its own citizens? I have in mind, for example, the case of Mr. Begun, a loyal Soviet Union citizen, who apparently has been sent to prison and is now threatened with further imprisonment or exile simply because he seeks to adopt the precepts of his own religion. Is it not time that we became a little more realistic about the Russians and understood that we are most unlikely to obtain from them anything in the nature of consensus, because what they want is confrontation?
Lord Trefgarne: My Lords, it is certainly true that the outcome of the Madrid Conference, so far as the human rights provisions are concerned, is less than we should have wished. Having said that, I would add that it is true that what we are now facing in the Madrid Conference is a consensus bar one on the final document. And I must say that the Soviet Union, too, has made some concessions.
Lord Jenkins of Putney: My Lords, is it not unfortunate that by the attitude of a single nation, on a point which I understand is not central to the issues on which agreement has been reached, the Government are prevented from making a statement on this matter on the last day that this House meets before the Recess? Is there any way in which this regrettable situation can be overcome?
Lord Trefgarne: My Lords, I fear that it will not be possible to go further today because, as the noble Lord points out, we are short of a consensus by one, which is of course Malta.
Baroness Gardner of Parkes: My Lords, may I ask my noble friend the Minister to elaborate his reply to the noble Lord, Lord Shinwell, in regard to the human rights issue? Are we to understand from what he said

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that any agreement is not honouring all four baskets of the Helsinki Agreement?
Lord Trefgarne: My Lords, the document to which I have referred, and which is now almost agreed in Madrid, provides, as I say, for some important new steps with regard to human rights. In particular, there is to be a meeting of experts in connection with this matter in Canada, in 1985, and this is embodied in the document.
Lord Cledwyn of Penrhos: My Lords, does the noble Lord accept that the degree of agreement achieved in Madrid augurs well for the disarmament conference in Geneva? Can he say a word about the difficulties that have caused the delay in reaching a final agreement: namely, what is referred to as the Maltese problem? Can he state what is Her Majesty's Government's view of the Maltese problem? What does he think the sticking point is? Does he think that it can be overcome?
Lord Trefgarne: My Lords, with regard to the second point that the noble Lord made, the onus is now clearly upon Malta to join the consensus that has been reached. It is the Government's view that the proposals that Malta is now bringing forward would not be appropriately included in the final document. Indeed that is the view, I understand, of the other 33 members of the conference in Madrid—all, indeed, save Malta itself. As for the implications of the CDE for other conferences that are taking place in the world—for example, the START, the INF and the disarmament conference in Geneva—we shall have to see whether there is any read-across, to use the jargon, from one to the other; but the preliminary conference with regard to the CDE will take place towards the end of this year.
Lord Cledwyn of Penrhos: My Lords, will the Minister confirm that Malta, if it so decides, would have a veto that would postpone settlement indefinitely?
Lord Trefgarne: My Lords, the CSCE rules provide that agreement must be by consensus, which is to say that no one must disagree. Malta is so far failing to agree.
Lord Shinwell: My Lords, as I am unlikely to be allowed to put another question for the next three months—and I can give no guarantee even after then that I shall be available to put a question—may I put this simple question? Can the Minister out of his own heart and mind, as representing the Government to which he belongs, really believe that within the next three months it is possible to come to some satisfactory arrangement with the Soviet Union which will provide some kind of guarantee or, at any rate, belief, that we can avoid a conflict with that country?
Lord Trefgarne: My Lords, I hope and believe that we can avoid a conflict with that country not only within the next three months but, indeed, for as far ahead as I can see. With regard to the Madrid conference and the CSCE process generally, we never thought that we would achieve everything overnight.
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Indeed, the latest Madrid conference has gone on a lot longer than we would have anticipated. But we have made a little progress, and we should be thankful for that.
Lord Brockway: My Lords, may I ask the Minister a question about the difficulty that has arisen with Malta? While it would be inappropriate to hold a European conference on the Mediterranean, because it would cover North Africa and West Asia, cannot an assurance be given that a separate conference would be held on this important issue?
Lord Trefgarne: My Lords, I have no doubt that if Malta wanted to hold such a conference and convene it, it would be open to Malta to do so. The question is whether the provision of such a conference and some of the other things that Malta wants to go with it, should be included in the document that we are now considering.
Lord Hankey: My Lords, will the Government agree that it is terribly important to go on talking to the Russians whatever our relations with them across the world? Is it not equally important not to be bamboozled by the peace campaign that seems to be starting in Soviet external relations at a time when the Communists are trying to mop up central America?
Lord Trefgarne: My Lords, I agree with both assertions.

Shops Legislation
3.24 p.m.
Lord Harris of High Cross: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will contemplate the repeal of the Shops Act following the mixed fortunes of recent private members' Bills in the two Houses.
The Parliamentary Under-Secretary of State, Home Office (Lord Elton): My Lords, we are not contemplating such a repeal at present; but my right honourable and learned friend the Home Secretary is considering the options for resolving the present disagreement about reform of the law on trading which is contained in the Shops Act 1950, and hopes to make an announcement shortly.
Lord Harris of High Cross: My Lords, I thank the noble Lord for that rather qualified Answer. May I draw his attention to the fact that when this matter was debated in this House and elsewhere there were enormous expressions on all sides of the need to reform or repeal the Shops Act? If there is any doubt about the matter and the urgency of it, will the Government draw on the unrivalled experience of the noble Baroness, Lady Trumpington, who was recently abducted from our repeal group to ornament the Government Benches as a Baroness in Waiting?
Lord Elton: My Lords, I am, indeed, aware of the strong views on all sides on this matter in both Houses and the fact that they are in conflict. That is why we are having considerations. I am glad that the noble Lord like myself is aware of the sterling work of my noble friend Lady Trumpington who has now been recruited to our ranks.
Lord Jacques: My Lords, will the Minister ask his right honourable and learned friend to bear in mind that both the employees and the employers in the distributive industry have asked for an inquiry before there is any radical change in shop law? They believe that one should consider the long-term future. Both sides have promised to give the fullest co-operation.
Lord Elton: My Lords, I am grateful to the noble Lord for his intervention. There are both the employers and the employees, as well as the consumers, to consider in this matter.
Lord Bishopston: My Lords, will the Minister recognise that the noble Baroness is not the only one in waiting for changes in the law? May I stress the relevance of the noble Lord's Question relating to the need for a review of the Shops Act in the light of changing circumstances? Will the Minister, recognising the effects on the British way of life and, in particular, family life, give an assurance that there will be widespread consultation with the trade, the trade unions, the local authorities, the churches and other bodies? Finally, will the Government give what help they can to ensure that the legislation produced is soundly drafted and adequate to the circumstances?
Lord Elton: My Lords, my right honourable and learned friend is always very careful and thorough in his reflections. We always make it a point never to bring in legislation that is not soundly drafted and effective.
Lord Simon of Glaisdale: My Lords, is the noble Lord aware that the criticisms of the trading restrictions go far beyond Sunday trading? If there is to be an inquiry, will he ensure that it covers the whole ground in the same manner that was covered by the Gowers Committee without effective action being taken?
Lord Elton: My Lords, the subject of my right honourable and learned friend's consideration is the Shops Act which of course goes beyond Sunday trading. I will bring the noble and learned Lord's other concerns to my right honourable and learned friend's attention.
Lord Monson: My Lords, will the Minister say why, when the Government have a majority of 144 in another place, they are still evidently intimidated by minority pressure groups, and why in view of majority public opinion they do not introduce a Government Bill to bring the English shops Act into line with the far more liberal and more appropriate Acts prevailing in Scotland?
Lord Elton: My Lords, it is our custom to consider the wishes of all the people concerned. In this case, it
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refers to all the people in this country who may wish or may not wish to be able to buy certain things on Sundays and at other times of the week. I do not think that it would be right to proceed precipitately. I think that my right honourable and learned friend is taking the right course.
Lord Bishopston: My Lords, in view of the fact that the Minister is reluctant to make any changes where there is not complete agreement on legislation, may I ask him whether he will ensure that the same principle applies to other aspects of our legislation?
Lord Elton: My Lords, the disagreement in this case appears to lie between the Houses rather than parties and between members of parties rather than the parties. I do not think that the noble Lord can expect me to respond in any helpful way to his question.

Namibian Independence
3.28 p.m.
Lord Hatch of Lusby: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what progress they have made in their efforts to secure independence for Namibia according to the conditions laid down by the United Nations.
Lord Trefgarne: My Lords, in accordance with United Nations Security Council Resolution 532, the Secretary-General is holding consultations about the implementation of the United Nations Plan for Namibia. We and our partners in the Five have assured the Secretary-General of our support and cooperation. Separate discussions on regional security issues are continuing between the United States and Angola. Progress towards Namibian independence depends on these.
Lord Hatch of Lusby: My Lords, I thank the noble Lord for that Answer, but can he address himself directly to what the British Government are doing, with their own special responsibilities in this situation? Is he aware that for many years now and right up to the present moment, Namibian citizens—men, women and children—have been detained, tortured and killed by the South African Administration? This has gone on for many years. What are the British Government doing at present in order to fulfil their obligations to bring independence to Namibia under the terms of the United Nations resolution?
Lord Trefgarne: My Lords, as I have endeavoured to explain, responsibility for this matter rests with the United Nations. As the noble Lord knows, we are a member of the Five, and the Five are in close touch and considering ways in which to move the negotiations forward—for example, the Foreign Ministers of the Five met in Williamsburg on 28th May and again in Paris on 8th June and affirmed their intention to achieve a settlement. My right honourable friend the Foreign Secretary discussed Namibia with members of the United States Administration earlier in July during his visit to Washington.
Lord Paget of Northampton: My Lords, will the noble Lord agree that it all depends on what you mean by "independence"? Would Her Majesty's Government's policy be really advanced by allowing Namibia to fall into the hands of a tribal party controlled by Cuban advisers?
Lord Trefgarne: My Lords, the policy of the British Government in this matter, within the ambit of the United Nations' plan, is of course to allow Namibians to choose for themselves the type of government they require.
Lord Paget of Northampton: My Lords, a fat lot of chance they have to do that!
Lord Cledwyn of Penrhos: My Lords, can the noble Lord confirm that towards the end of May the Government asked the South African Government to withdraw South African troops from Angola? Can the noble Lord say whether any response to that request has been received from the South African Government? Secondly, would the noble Lord not agree that the difficulties in Namibia have had the result of causing enormous economic damage in the country and that every day that goes by that damage becomes worse? Can he say whether Her Majesty's Government have any specific initiative in mind which might lead to a settlement?
Lord Trefgarne: My Lords, as I have said before, the onus of producing an initiative rests with the Five, of which we are a member, and with the Secretary-General of the United Nations. He is moving this matter forward in the ways that I have described. As regards the South African troops in Angola, we certainly think that they ought to withdraw; we certainly think that all foreign troops in the region ought to withdraw.
Lord Molloy: My Lords, would the noble Lord the Minister not agree that the situation now in Namibia is reaching horrendous proportions? The slaying, the killing, the mutilating and the butchery ought to shock us all. Is he, therefore, able to enlarge a little upon what he meant by the co-operation of Great Britain in support of the United Nations resolution? What exactly is that co-operation and what is the level of support that our country is giving in this particularly awful situation?
Lord Trefgarne: My Lords, the United Nations' plan, in essence, calls for the withdrawal of all the foreign troops from Namibia; the return of the SWAPO troops to their bases; the holding of free and fair elections in that country; and, in the interim, the presence of a United Nations force to see that the elections are properly conducted. We are using our best endeavours to see that that plan is operated.
Lord Caradon: My Lords, is it not understood and appreciated what dreadful damage has been done to the reputation of this country and of the Five and, indeed, to the authority of the United Nations, by the fact that South Africa has been able for years to stand in the way of the declared intention of the international authority? Is is not a matter for grave
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criticism of our country for not taking a lead in the matter in which we have a special responsibility? May I also add: Is it not widely believed that South Africa has been able to postpone carrying out the decision of the international authority, and that the United States, by raising a separate issue, has contributed to that serious delay?
Lord Trefgarne: My Lords, I agree that the attitude of the South African Government on some of these matters has been less than helpful. But they do have some legitimate security concerns in that part of the world, not least the presence of Cuban troops in Angola. We hope that the right way forward, therefore, is the way that I have described.
Lord Brockway: My Lords, will the Government urgently give their mind to expediting a settlement of this problem, not only because of the atrocities which my noble friend Lord Hatch of Lusby indicated, but because every delay is strengthening the position of the illegal South African occupation and the situation is deteriorating so that there is now loss of confidence in the group in the West which has been seeking a solution?
Lord Trefgarne: My Lords, I agree that a settlement is highly desirable in this matter, but I am afraid that it is not possible for the British Government or even for the Five to impose a settlement upon the region. I believe that the interests of all parties would be served by an early settlement but, as I say, that is not a matter over which we can wave a magic wand.
Lord Hatch of Lusby: My Lords, I was a little concerned at the first answer given by the noble Lord to my supplementary. May I ask him to clarify it? Did I hear him aright in saying that the negotiations between the United States and Angola were all important for security in the region? Surely the British Government have their own responsibility, quite apart from United States policy? Is it not the case that the Cuban troops are in Angola—not in Namibia—and that they are there because Angola was originally invaded, before there were any Cuban troops there, by South African forces?
Lord Trefgarne: My Lords, it is the case that Cuban troops are principally in Angola, but the South Africans can hardly be expected to face that with equanimity.

Business
3.37 p.m.
Lord Denham: My Lords, at a convenient moment this afternoon my noble friend Lord Cockfield will, with the leave of the House, repeat a Statement that is to be made in another place on the Stock Exchange.
My noble friend will then repeat a Statement on Revised Cash Limits 1983–84.
This will be followed by my noble friend Lord Trefgarne, who will repeat a Statement on the Gibraltar Dockyard.
Lord Hatch of Lusby: My Lords, I promise that I am not making a habit of raising business questions, but there does seem to me to be today a matter of some parliamentary importance, quite apart from party interest. The noble Baroness the Minister of State at the Foreign Office has twice—first, to my noble friend Lord Oram and then to myself, the noble Earl, Lord Longford, and the noble Lord, Lord Beaumont of Whitley—promised to make a response to the report of the Foreign Affairs Committee in another place concerning the scientific units in the Overseas Development Association. Today the Minister of State at the Foreign Office responsible for the Overseas Development Association held a press conference at noon, when was revealed the Government's response to the budgets of the scientific units. Is this not a prevention of the responsibility of government? Should not the Minister of State have come to Parliament and had his statement repeated here, so that it could be properly examined by Parliament before the public, and so that questions could be put to the Minister concerned?
The White Paper was issued at noon today. It is in the Printed Paper Office, but I understand from what the noble Lord the Chief Whip has just said that there will be no statement on it as we were, at least by implication, promised. Therefore, Members of Parliament in both Houses are deprived of the opportunity of considering the Government's attitude to this important report and of putting their questions to the Government.
Viscount Whitelaw: My Lords, I am grateful to the noble Lord for having informed my office that he wished to raise this matter. I hope the noble Lord will think it reasonable if I draw on my experience in another place, as well as my very short experience here, to explain to him the position. I am most anxious to do this because I should wish neither him nor the House to think that I was in any way guilty of any discourtesy in this matter, and I do not think that I am.
First, I assure the noble Lord that, on my understanding, no press conference was actually held at twelve o'clock. I understand that a press conference had been planned, but, equally, I understand that that press conference was not held. It is not for me to speculate on why the press conference was not held, but I do not think it was. As to the question of making a response, I am sure that the noble Lord will agree that a response to a report of a Select Committee of another place does not necessarily involve an oral Statement being made, either in another place or in this House. In fact, I have made many responses in another capacity to various Select Committee reports and no one expected me to make an oral Statement in another place, nor for it to be repeated here. Therefore, I think that a response can be made without an oral Statement.
At to the question on oral Statements, the problem is that every Leader of the House in another place has to look to the priorities of the time of the House and the number of Statements that may be required. As the noble Lord will notice, today four Statements are being made in another place. In accordance with custom, three are being repeated here at the request of the Opposition, and I think that that is the proper way
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in which to proceed. Therefore, I should like the noble Lord to think that I am following the precedent in these matters. When Statements are made in another place, if it is the wish of the Opposition, they will be repeated here. But, of course, unless the main Minister concerned is a Member of this House, it is clear that the initiative for making an oral Statement must come from another place. I hope that I have not bored your Lordships, but I am very anxious to show that I am trying to follow the precedents and doing what I believe to be right for this House.

House of Lords Offices
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move that the First Report from the Select Committee on House of Lords Offices be agreed to.
Moved, That the First Report from the Select Committee be agreed to.—(Lord Aberdare.)
The report was as follows:
1. Appointment of Sub-Committees
The following members of the Committee were appointed to the Sub-Committees?

(a) Administration Committee

L. Aberdare

L. Ampthill

L. Darling of Hillsborough

E. De La Warr

L. Denham

V. Eccles

B. Hylton-Foster

L. Kilmarnock

B. Llewelyn-Davies of Hastoe

L. Ponsonby of Shulbrede

L. Reilly

L. Wigoder.

With the Clerk of the Parliaments and the Gentleman Usher of the Black Rod.

With power to co-opt further Lords.

(b) Library Sub-Committee

L. Ardwick

L. Darling of Hillsborough

B. David

V. Eccles

L. Mclntosh of Haringey

E. Minto

L. Wigoder.

With the Clerk of the Parliaments.

With power to co-opt further Lords and to appoint their own Chairman.

(c) Refreshment Sub-Committee

L. Ampthill

L. Ardwick

L. Denham

L. Greenway

B. Hylton-Foster

L. Nugent of Guildford

L. Ponsonby of Shulbrede

L. Wigoder.

With the Clerk of the Parliaments.

With power to co-opt further Lords and to appoint their own Chairman.

(d) Computer Sub-Committee

L. Darling of Hillsborough

V. Eccles

L. McIntosh of Haringey.

With the Clerk of the Parliaments.

With power to co-opt further Lords and to appoint their own Chairman.

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(e) Staff of the House Sub-Committee

L. Aberdare

L. Nugent of Guildford

B. White

V. Whitelaw (L. President.)

With the Clerk of the Parliaments and the Gentleman Usher of the Black Rod.

With power to co-opt further Lords.

(f) Finance Sub-Committee

L. Aberdare

L. Ampthill

L. Darling of Hillsborough

L. Denham

V. Eccles

L. Kilmarnock

L. Ponsonby of Shulbrede

L. Wigoder.

With the Clerk of the Parliaments.

With power to co-opt further Lords.

(g) Works of Art Sub-Committee

B. Birk

M. Cholmondeley

L. Gibson

E. Listowel

L. Reilly

B. Trumpington.

With the Clerk of the Parliaments.

With power to co-opt further Lords and to appoint their own Chairman.

2. Staff of the House
A report was received from the Sub-Committee.
The Committee authorised temporary pay supplements to Hansard Sub-Editors and Reporters and to Doorkeepers, Clerical Officers and Attendants.
3. Library
A report from the Library Sub-Committee for the year 1982 was laid before the Committee.
4. Retirement of the Clerk of the Parliaments
The Committee wish to record, on the occasion of his retirement, their deep gratitude for the assistance that they have received from Sir Peter Henderson during the nine years he has served as Clerk of the Parliaments and Accounting Officer for the House of Lords Vote.
5. Parliament Office
The Committee were informed that it was proposed that Mr. M. A. J. Wheeler-Booth on his appointment as Reading Clerk should assume the duties of Clerk of the Journals; that Mr. J. M. Davies should be appointed Principal Clerk, Overseas and European office and that Mr. M. G. Pownall, a Senior Clerk, should assume the duties of Establishment Officer and Secretary to the Chairman of Committees in the place of Mr. Davies.
The Committee authorised the temporary payment of a secretarial allowance to Mr. M. G. Pownall.
The Committee were also informed that Mr. D. R. Beamish had replaced Mr. Pownall as Secretary to the Leader of the House and Chief Whip.
6. Revised Scales of Pay and Allowances
The Committee approved revisions in salary and made provision for the payment of resettlement grants on termination of office for the Chairman and Principal Deputy Chairman of Committees.
The Committee also confirmed the application to staff of the House of Lords of the following Civil Service Memoranda:—

CM/600

Revised conditions of service affecting entitlement to overtime and subsistence.

CM/601

Revised rates of pay to grades up to the rank of Chief Clerk.

CM/602

Revised rates of London Weighting.

IM/83/3

CM/603

Revised responsibility allowances.

CM/604

Revised typing etc., proficiency payments.

7. Reporting staff
The Committee approved a revision in the scale of charges for typists supplied by Haynes Secretarial Services.
8. Doorkeepers
The Committee authorised a revision in the allowances payable to Doorkeepers for the provision and upkeep of items of dress clothes.
9. Parliamentary Delegations
The Committee approved a revised administrative guide for members of the United Kingdom delegation to European assemblies.
10. Television Documentary Films
The Committee agreed to allow the British Broadcasting Corporation to sell a short extract from the Nationwide television documentary films on the House of Lords.
11. Superannuation
The Committee were notified of the following awards:

(i) Preserved pension and lump sum to Mrs. M. Andrew, Cataloguer, who resigned on 28th February 1983.

(ii) Preserved pension and lump sum to Mr. S. H. Braham, Sub-Editor, who resigned on 30th November 1982.

(iii) Pension and lump sum to Mrs. F. Dunn, Head Housemaid, on formal retirement from 8th June 1983.

(iv) Revised Short Service Payment to Miss P. M. Dean, Clerical Officer, who resigned on 22nd October 1982.

On Question, Motion agreed to.

Foreign Limitation Periods Bill [H.L.]
3.42 p.m.
The Lord Chancellor: My Lords, in rising to move that this Bill be now read a second time, I have it on command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Foreign Limitation Periods Bill, has consented to place her prerogative and interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
I can hardly pretend that this Bill is throbbing with human interest. Its object is to reform a rule of private international law as applied in England and Wales. With two minor exceptions, to which I shall come, it is in precisely the form annexed by the Law Commission to their Report No. 114. All legal systems contain provisions for the extinction or barring of stale claims after a prescribed period. In common with most, if not all others, our own law, too, prescribes time limits within which civil claims may be brought. These vary for different classes of claim and differ from one legal system to another. They are also of varying effect. Regarded procedurally, the lapse of time may merely bar the remedy, so that while the right remains theoretically intact, it becomes unenforceable by action. That is regarded as procedure. Alternatively, upon the expiry of the time limit the right may itself be extinguished. That is regarded as a rule of substantive law.
This distinction, apparently so technical, between procedure and substance is of particular significance when foreign claims become the subject of litigation. If the foreign limitation period is merely procedural it is ignored by the English courts and so long as that too is procedural, our courts apply the English limitation period instead. This is because the general rule is that all procedural matters are dealt with according to the law of the court of trial. If, on the other hand, the foreign limitation period is part of the substantive foreign law it will be effective to bar the claim. This is because, the limitation being substantive in character, the right is considered to have been destroyed.
The intermediate case when the claim is in time by the foreign law but out of time by English law, or vice versa, is not entirely clear. It is also less clear what the

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English courts would do if the English limitation period was classed as substantive and the foreign limitation was classed as procedural. The Law Commission's answer to this conundrum was that as at present:
"the action would seem to remain perpetually enforceable; though it is to be expected that an English court would strive to avoid this conclusion".
With such Delphic words the Law Commission declared itself baffled.
The present law of England is consistent neither with that of many other jurisdictions, notably those civil law jurisdictions within the European Community, nor with the Community Convention on the Law Applicable to Contractual Obligations. It was examined by the Law Commission and found wanting. Further, they found widespread support for its reform. The principal criticisms are that it is based on a distinction which is in some respects at least unreal. I have explained this and its anomalous effects. It may well be thought that a right cannot be said to have an objective existence independently of the remedy which can enforce it. This, of course, is a philosophical point.
Secondly, in certain circumstances the English rule may bar a claim which is still alive in the country in which it arose. This result is contrary to the spirit of our system of private international law which seeks to enforce foreign rights and not to destroy them. Conversely, the English rule can operate to frustrate a foreign limitation law which aims to protect defendants from stale claims. This may give succour to a tardy claimant by enabling him to make his claim in this country. Thirdly, the Law Commission thought it questionable whether the application of the English rule is necessarily simple, since it may involve reference to two quite different legal systems.
The Law Commission's recommendation is that, where under our existing rules of private international law the substantive foreign law alone applies, the rule of the same foreign law which relates to limitation should also be applied, and not the English law of limitation. Subject to one or two qualifications and to certain exceptions recommended in the report, that scheme is that adopted in this Bill.
The principal exception is contained in subsection (1) of Clause 2 of the Bill. That is the public policy exception. Where in a particular case, the court determines that the application of the principal period of limitation prescribed under the foreign law would be contrary to public policy here, the court may refrain from applying it. This follows a general principle. The principle is that our courts have a discretion to refuse to apply foreign law where to do so in a particular case would be contrary to the fundamental policy of English law—in effect, that means to public conscience as it is understood here. Recourse to that principle will be made only in exceptional circumstances. There is a similar provision in Section 8(2) of the Recognition of Divorces and Legal Separations Act 1971, which gives effect to The Hague Convention on that subject.
An example falling within Clause 2(1) might be where the relevant foreign law prescribes different limitation periods for different classes of claimant in such a way as to discriminate against different racial
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groups. Though instances are likely to be rare, the principle does afford some safeguard against cases which would otherwise be contrary to conscience. One observation is appropriate. While the notions of public policy to be applied are those of English law, they are not applied merely to suit individual notions of expediency and fairness, for that would be unwarrantably destructive of foreign rights and contrary to the spirit of the system of private international law.
Clause 2(2) contains a second exception to the general principle. The expression "law on limitation" is denned in Clause 4 of the Bill as including provisions extending or interrupting the limitation period. However, in view of the disfavour with which one particular class of such provisions is generally regarded, special treatment is provided in that case. Thus, a court is to disregard any suspensive provision of the foreign law effective on the absence from a specified jurisdiction of a party to the proceedings. Were this not so there might be cases in which a defendant in proceedings in this country would be deprived indefinitely of the benefit of the relevant period of limitation owing to his presence here and not elsewhere. Other suspensive provisions of the foreign law are to be applied by our courts, as indeed is the whole body of a foreign law of limitation, apart from any rules of private international law, but including the exercise of any discretionary power.
Finally, subsection (3) of Clause 2 excepts from the general principle of the Bill a suspensive provision of our own law; namely, that in Section 1 of the Limitation (Enemies and War Prisoners) Act 1945, which provides that time shall not run during any period when a party is an enemy or is detained in enemy territory. If a foreign court has given a judgment in any matter by reference to the law of limitation of its own or of any other country, including that of England and Wales, that judgment too, quite logically, is to be recognised by our courts as a judgment on the merits, and hence will be a conclusive determination of the parties' rights. That is provided for by Clause 3. It is to be noted that by Clause 5 the provisions of the Bill apply also to arbitration proceedings; and that by Clause 6 the whole Bill applies in relation to any action or proceeding by or against the Crown.
I mentioned at the outset that the Bill departs in only two places from the draft annexed to the Law Commission's Report. The first departure is the addition to Clause 1 of subsection (5). This applies to the so-called doctrine of renvoi —why one has to speak French, I do not know. Where an English court is directed to look at the law of one foreign country which then directs the judge to apply the law on limitation of a second country, it is the latter law on limitation alone which is applied in our courts. The law of the first country will act as a guide or pointer, but once it has performed that humble function it will be ignored. The second addition to the Law Commission's draft is Clause 7(3). This precludes retrospectivity and is designed to ensure that claims already barred in English courts under the existing law will not be revived by the changes effected by the Bill. Similarly there will be no effect on pending proceedings.

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The Bill, it will be remarked, has effect only in England and Wales; hence my constant use of the word "English" in preference to the word "British". The Scottish Law Commission produced earlier this year its consideration of Prescription and the Limitation of Actions. Its recommendations are consistent with those incorporated in this Bill, but would require a separate Prescription and Limitation (Scotland) Bill as suggested in their report. Again, as to Northern Ireland, separate legislation will be appropriate.
My Lords, I commend this Bill to your Lordships as a useful, if technical, item of law reform, and therefore beg to move that the Bill be now read a second time.
Moved, That the Bill be now read a second time.—(The Lord Chancellor.)
3.57 p.m.
Lord Elwyn-Jones: My Lords, the House will be grateful to the noble and learned Lord the Lord Chancellor for explaining the purport of this fascinating Bill. It is a classic piece of lawyers' law, but nevertheless necessary in the interests of clarifying a difficult branch of the law and is additionally in the interest of international comity. It fell to me, I think in 1979, to refer this matter to the Law Commission, and what followed was a classic piece of Law Commission procedure: the consultation with the interests concerned; the White Paper; and then finally, after further consultation, the production of the Bill which is substantially, subject to the two exceptions referred to by the noble and learned Lord, embodied in the Bill before the House.
The noble and learned Lord has mentioned the principal recommendation of the Law Commission: that where under our rules of private international law foreign law falls to be applied in proceedings in this country, the rule of that foreign law relating to limitation should also be applied, to the exclusion of the law of limitation in force in England and Wales. As the noble and learned Lord has said, that is embodied in Clause 1 of the Bill.
The noble and learned Lord has indicated that there is an exception to this principle which is embodied in the Bill in Clause 2(1), and there are some other exceptions as well. The words used in Clause 2(1) are:
"In any case in which the application of section 1 above would conflict to any extent with the principles of public policy applied by the courts of England and Wales in determining whether to give effect to the law of any other country, that section shall not apply to the extent that its application so conflicts".
The words I used there, "the principles of public policy", are wide words and there has been discussion as to whether there should be an attempt to define public policy. I am not surprised that that attempt was resisted, as it would present a great many difficulties.
There has been a suggestion that at least a body of guidelines should be made available to solicitors upon whom will fall the burden of interpreting this difficult legislation. The Bill itself, by reason of the fact that there is no reference to guidelines, shares the view of the Law Commission. This is undoubtedly an issue to which, in the fullness of time after the passage of a suitable period of refreshment in the Long Vacation, we shall no doubt return. This, as the noble and learned Lord has said, is a useful, if difficult, piece of
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legislation. It is no wish of mine to delay its further progress.
The Lord Chancellor: My Lords, I am very grateful indeed to the noble and learned Lord for his welcome to this Bill. As he said, he was the referer of the matter to the Law Commission. It has fallen to me to seek to enact the Law Commission's proposals. Our common predecessor, the noble and learned Lord, Lord Haldane, said that it takes three Lord Chancellors to effect a law reform. I think that is about right, but I hope there will be continued progress on amicable law reform which will not be interfered with in any way.
As regards public policy, it is, as some famous lawyer of the past said, a difficult horse to ride. I rode it very quietly in my opening remarks. I do now know whether the noble and learned Lord proposes that the guidelines should be a curb or a snaffle, but I am not sure how far we shall be able to improve on the draft. However, I shall bear in mind what the noble and learned Lord has said.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Redundancy Payments (Local Government) (Modification) Order 1983
4.3 p.m.
The Minister of State, Scottish Office (Lord Gray of Contin): My Lords, I beg to move that the draft Redundancy Payments (Local Government) (Modification) Order 1983 be approved. This order, which is being made under Section 149 of the Employment Protection (Consolidation) Act 1978, will modify the method of calculating redundancy payments for employees of local government and associated employers.
The order is in the nature of a tidying-up measure, since it places on a statutory footing the current practice of local authorities, which is to base redundancy payments on total aggregated local government service. This practice is at present authorised by the ministerial sanction of the Secretary of State for the Environment. The provision of statutory cover for the present arrangements is supported by all the employers' associations and the trade unions, together with the Government departments concerned and with the local authority sector. Indeed, it has been in contemplation for some years.
I should explain that, under the provisions of Part VI of the Employment Protection (Consolidation) Act 1978, an employee who is discharged as redundant after at least two years' service is entitled to be paid a redundancy payment. This is calculated, inter alia, according to his period of continuous service with his last employer. The employer is responsible for making the payment, but may then recover 41 per cent, of the cost from the redundancy fund by way of rebate. Local authorities and related institutions are legally distinct employers, so that, whenever an employee is made redundant, there is an entitlement to a statutory payment, and hence to the employer's rebate, even though the employee intends to move on to a post elsewhere in local government.

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The financial effect of the order on the redundancy fund in the long term is expected to be neutral. This is because the higher level of redundancy payments which will be payable out of the fund is likely to be compensated by the lower number of claims for rebate being made. It is estimated by one large local authority that higer rebates may have to be paid in about 10 per cent, of redundancies on account of aggregation, but redundancies will be fewer. This takes account of the fact that it is unlikely to relate to manual workers, who tend to stay with a single authority; and that older non-manual staff tend to spend most of the latter years of their career with one authority. The effect of the order will be to reduce the number of cases where redundancy payments are payable because they will no longer be paid where there is movement within the "common pool". I commend the order to the House.
Moved, That the draft order laid before the House on 6th July be approved.—(Lord Gray of Contin))
4.7 p.m.
Lord McCarthy: My Lords, I should like to thank the noble Lord for the clear way in which he has presented this order. We welcome the order. I found his explanations were in marked contrast to some of the explanations which have been put forward in another place on orders of this kind. While welcoming and supporting the general intentions of the order, I want simply to ask a number of questions, some about detail, some about form and some about scope.
My questions about detail and form really relate to the relationship between Schedule 1 and the Appendix, because noble Lords will be aware that the defined purpose of that schedule is,
"Employment to which this Order applies";
that is to say,
"Employers immediately before the Relevant Event",
or the employer of the individual before the redundancy. But, in addition to the schedule, we have an Appendix, and the purposes of the Appendix, I understand, are:
"Employers with which Employment may constitute Relevant Local Government Service".
My first question is: what is the difference? Why do we have Schedule 1, with a long list of employments to which the order applies—that is to say, employment immediately before the relevant event—and the Appendix, with another list of employers and a slightly different definition? Why do we have these two different lists, a schedule and an appendix, and what is the relationship between them?
I ask that question because my second question arises out of it. Some of the people contained in the schedule are also in the Appendix. Indeed, the Appendix begins by listing, substantially, those who are in the schedule. The first time in the Appendix is:
"Any employer described in Schedule 1 whether or not in existence at the time of the relevant event".
Therefore, we have the schedule and we have the Appendix, which repeats all the people in the schedule and then makes another list. My question is: why do we have these two lists, and what is the relationship between them?
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This brings me to my third question, which is: why do we need both lists? They are both long lists. They contain all the county councils, all district councils, employees of magistrates' courts and employees of sports councils. We have the Tay Road Bridge Joint Board, which gets in there somehow. We have the managers of schools, we have local valuation panels and so on. My question therefore is: why have these particular people been put on the list? Why are they the relevant people to go on the list? Is it because it is a comprehensive list of all forms of local government service?
If it be the case (I suppose it probably is, but I must make this point clear) that the schedule plus the Appendix represents all forms of local government service, why do we not just say so? If, on the other hand, one runs through the Appendix and the schedule, there are one or two forms of local government service which are not on either list. Some have been left out. Why have they been left out? Why do we have these two long lists? Between them, are they comprehensive? If they are not comprehensive, who has been left out? If they are comprehensive, why can we not have a general statement such as, "All persons employed in local government"?
Those are my questions on details and forms, but that is not the most important issue. The most important issue is that of scope. The order deals in a narrow sense with a narrow set of people, though they are quite considerable in number; that is to say, those employed in local government. But there are other people in rather similar circumstances. In particular, I think of those employees who, as a result of reorganisation—and, in particular, as a result of the reorganisation of 1974 when a lot of employees were taken from local government and put into the National Health Service; for example, ambulance men; for example, local authority administrators running school clinics or staff of medical officers of health; all of which was in the interests of the Government of the day—were taken from local government and put into the National Health Service. Are they covered by this order for their period when they worked in local government? And, if they are not covered, then why are they not covered?
This, I emphasise, is not an academic question because the Secretary of State for Social Services in another place said recently that he intends to remove 0·75 of the total staff of the National Health Service and that he does not intend that these redundancies shall, on the whole, come from those who had a direct relationship with the patient, for example, doctors or nurses; but they will come from just these kinds of people who were drafted from local government into the National Health Service, ambulance men, local authority administrators operating school clinics and so on. Will these people be covered by this order? And should they not be covered by it, since they are going to have the whole of their service taken into account in questions of redundancy payments? That is right and that is proper. Why should it not cover those people, as well?
This brings me to my next question. If we are talking about those who are to be covered in local authorities, what about the health service generally? Surely the health service could be said to be a series of individual

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employers, separate employers, as the noble Lord has said. If they are employed in the National Health Service, as they were employed previously by area health authorities, and if, as a result of the reorganisation by the present Government, they are now employed by district health authorities, for the most part, why should they not be covered by provisions of this kind? They will move about from job to job; they may be declared redundant; they may wish to calculate and take into account all their service in the health service in exactly the same way as they might do so if they were in local government, whether they had ever been in local government or not.
So my next question is, if this is the principle as laid down by the Minister in another place and by the Minister today, why should this not cover the National Health Service as well as local government? But why stop there? We have other people in the public service sector (for example, in the water industry) who are in much the same position. Why should not similar provisions cover them as well?
This brings me to my final question dealing with the scope and principles behind this Bill. Is it the case—as I think it is—that we are trying here to do something about one group of workers in the public service sector who have been subjected to almost constant reorganisation in the interests of greater efficiency, who often were encouraged to move from what were formerly different employers within a common service to make possible reorganisation to facilitate the shedding of staff over a wider area and to make more effective use of labour? If that is the principle and if we are saying that, for redundancy purposes, we should assume that they have in effect a common employer, much as is the case in private industry—and it is not enough that this should be done by custom and practice or by ministerial permission or even by collective agreement—why are we not to see—indeed, are we to see?—a set of similar provisions which cover other parts of the public service sector?
Those are my questions. I am not asking for the answers to all of them today, but I would like the answers to some of these questions. To make clear what I am asking, I should like once again before I sit down to repeat them. The questions are these. What is the relationship between Schedule 1 and the appendix? Why does the appendix include organisations in Schedule 1? Are the two lists in the appendix and in Schedule 1 comprehensive? Do they cover all local government employees? If they do, why do not we have a general statement? If they do not, who has been excluded? Does the order cover periods of service in local government even if subsequently one has been transferred to another area such as the National Health Service, and if the object of the order is what I think it is, why do not the Government come forward with an order which covers similar groups in other parts of the public service sector?
Lord Gray of Contin: My Lords, I am grateful to the noble Lord for the welcome he has given this order, and I am also appreciative of the fact that he indicated to me that he would not expect answers to the questions which he has posed at very short notice to the Dispatch Box. I shall study the record very carefully and I shall ensure that the noble Lord is given
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a very full answer to the points which he raised. I would say that I think that, to some extent, some of the questions that he raised are already explained in the schedule. For example, I think that the list of those to whom this order refers is set out in considerable detail in Schedule 1.
So far as the purpose of the order is concerned, he will appreciate that during a career in local government it is frequently necessary for employees to move around to a considerable extent from one authority to another and from one form of local government to another. His request as to why this order is not extended to the National Health Service and similar bodies is purely because it is simply a local government employment order. I can assure him that the several years which it took to carry on the various consultations with local authorities and those involved in local authority work make it quite obvious that if we had tried to extend this on a wider scale the period of consultation would have been very much greater and we might not have been able to consider this order today. I would say to the noble Lord that I welcome his acceptance of the order. I shall study very carefully what he said and ensure that he receives a very full answer to the points which he has raised.
Lord Rochester: My Lords, I have not spoken to this order, but if the noble Lord is to make a written response to the noble Lord, Lord McCarthy, would he be kind enough also to send me a copy of any reply he makes so that we on these Benches may be aware of the answers?
Lord Gray of Contin: My Lords, I am grateful to the noble Lord. I can assure him that I will make sure that he, too, receives a copy.
On Question, Motion agreed to.

The Stock Exchange
4.20 p.m.
The Chancellor of the Duchy of Lancaster (Lord Cockfield): My Lords, I will, with permission, repeat a Statement made by my right honourable friend the Secretary of State for Trade and Industry in another place. The Statement is as follows:
"With permission, Mr. Speaker, I wish to make a Statement about the case brought by the Director General of Fair Trading against the Stock Exchange in the Restrictive Practices Court.
"Ministers have for some time been concerned that the court proceedings under the Restrictive Trade Practices Act may not be the best way to pursue the matters raised by the Director General. While these proceedings are pending, it is difficult for the Stock Exchange to make changes to enable its members to compete for business worldwide. There is also a danger that the legal proceedings within the framework of the Act may damage the effective operation of the Stock Exchange, which remains essential to the working of our economy. Accordingly, the Government would wish to see the matter settled out of court, if the Stock Exchange is able to make acceptable changes.

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"I decided to discuss the matter with the Director General and thereafter with the Chairman of the Stock Exchange. I explained that the Government had concluded that in order to safeguard the position of investors the separation of the functions of brokers and jobbers should be preserved at least for the time being in its present form. The House will recall that, in analogous circumstances, it insisted on separating brokers and underwriters at Lloyd's. The Stock Exchange's rules which prescribe the separation of capacity may have to be included in statutory provisions under EC Directives. In that case I intend to make regulations under the European Communities Act.
"I said that I should also expect the Stock Exchange to make changes on points of concern to the Director General. Following discussions with his Council, the Chairman of the Stock Exchange has made the following proposals to me:
"The Council will take action to dismantle by stages and with no unreasonable delay all the rules which prescribe minimum scales of commission, completing this by 31st December 1986. The Stock Exchange will continue the rules prescribing separation of capacity of brokers and jobbers. The Council will introduce rules to permit non-members to serve as non-executive directors of limited corporate members of the Stock Exchange, provided that there is always a majority of directors who are members of the Stock Exchange.
"The Council will recommend to the members of the Stock Exchange changes which would: first, introduce lay members to the Council of the Stock Exchange, their number and the method of their selection to be agreed with the Bank of England.
"Second, establish a new appeal body, independent of Stock Exchange members of the Council. If the Council were to reject an applicant for membership who fulfilled the requirements of the rules, the appeal body could review the decision and overrule it. This body would include lay members of the Council, but Stock Exchange members of the Council would not be eligible.
"Third, introduce people who are not Stock Exchange members of the Council to the Stock Exchange's existing appeals committee on disciplinary matters so that they will constitute at least a majority on the committee. Lay members of the Council would be eligible to serve on this committee.
"I believe that these changes are to be welcomed, and would enable the Stock Exchange to continue to adapt in an evolutionary manner to changing circumstances while maintaining proper regard to the needs and protection of investors. The next step will be for the membership to approve the necessary changes to the Stock Exchange deed of settlement. I shall also make arrangements for the Department of Trade and Industry and the Bank of England to monitor the implementation of these measures, and the evolution and development of the Stock Exchange as an efficient, competitive and suitably regulated central market which affords proper protection to investors. Subject to these two points
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the Government will seek approval of Parliament for measures to exclude the Stock Exchange from the operation of the Restrictive Trade Practices Act."
My Lords, that completes the Statement.
4.24 p.m.
Lord Bruce of Donington: My Lords, we on this side of the House wish to thank the noble Lord for repeating the Statement made by his right honourable friend. May I once again point out to the noble Lord on the Government Benches that this Statement arrived on the Opposition Front Bench at 21 minutes past three, with the usual indication, of course, that the Statement would be made at some suitable time after 3.30. Once again I have to protest that this is not the way in which the Opposition should be treated in matters of this kind. If the Government are able to leak items to the press concerning what they propose to do the following day—at any rate, to leak the matter in its generality—surely it is not beyond the wits of Government to have a Statement ready somewhere around about midday, with the object that after they have studied the Statement themselves and made quite sure that they themselves understand it, the Opposition can have adequate time in order to study the Statement and collect such papers as they may require in order to put questions in generality. May I therefore request that this once again be brought to the attention of those officials of Govenment and of the House who are responsible for it?
We note in particular the last paragraph of the Statement; and I quote—
"Subject to these two points the Government will seek approval of Parliament for measures to exclude the Stock Exchange from the operation of the Restrictive Trade Practices Act".
It is to be hoped that both in another place and in this House a full opportunity for debate will be given in order that this matter may be thoroughly ventilated.
The Statement says that Ministers have been concerned "for some time" about the proceedings. These proceedings have been anticipated and indeed have had the support of successive Governments for quite a period of time. How was it that so suddenly the Government became concerned that the effective operation and expansion of the Stock Exchange's activities are being inhibited by the threat of proceedings? The Stock Exchange and its members appear to have done pretty well over the last three or four years at any rate, and their activities have indeed been expanded. Since when have their activities been impeded by the threat of these proceedings, and, if so, in what manner? Is the noble Lord aware that the country has reasonable grounds for supposing that the Government themselves have caved in to very considerable political and other pressures from the City of London in this matter?
Will the noble Lord give the House an assurance that the Stock Exchange will comply voluntarily with all those points at issue with the Office of Fair Trading? The matters at issue are those which are the subject of prospective litigation before the Restrictive Practices Court and are most certainly not confined to the matters mentioned in the Statement. Will the noble Lord tell the House whether it is his understanding of the position that if the voluntary points that are

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conceded by the Stock Exchange do not meet all the objections of the Office of Fair Trading, the Director General of the Office of Fair Trading will have the right still to go before the Restrictive Practices Court on the remaining items about which the Stock Exchange has given no undertaking?
I should like to refer in particular to the separation of the functions of brokers and jobbers. The Government have come to the conclusion that this should continue "for the time being" in its present form. If there is virtue in the present system, why should it continue only for the time being? It seems that this degree of indecisiveness is more likely to affect the future operation of the Stock Exchange and its prosperity than coming to a decision one way or the other. Either it is a good thing and should be retained without this "for the time being", or it is a bad thing and a time limit should be set for the separation to cease and for the positions to be merged.
The Minister has received an assurance from the council that it will
"dismantle by stages and with no unreasonable delay all the rules which prescribe minimum scales of commission, completing this by 31st December 1986".
Why 31st December 1986? Is it beyond the wit of man, and the brains of the Stock Exchange and its members, to effect such changes before 31 st December 1986, by which time, I have no doubt, Her Majesty's present Government may have changed their mind and decided that they will accept further extensions? This is a thoroughly unsatisfactory Statement and I hope that it may be secured through the usual channels that we have very adequate time indeed to debate it.
Lord Mais: My Lords, I should like to support what was said by the noble Lord on the Opposition Front Bench on the time factor in regard to this Statement. It was handed to me not more than half-an-hour ago. We ought really to have been given more opportunity to study it and its implications, and I hope that when the next report is made we shall be given adequate time to consider it in detail.
I am glad to note the point regarding the safeguarding of investors. After all, they are the most important persons connected with the Stock Exchange. It is paramount that their interests should be protected and we shall certainly do our utmost to see that they are. As regards the position of brokers and jobbers, I note that they will be preserved but that the matter will be discussed further. Frankly, the sooner that question is settled the better for all of us.
I am very glad that it looks as if we shall not have legal proceedings. They could have a very serious implication for the working of the Stock Exchange. They would discourage investors from dealing with the Stock Exchange and would cause a good deal of unnecessary uncertainty. We on these Benches sincerely hope that the problem can be solved out of court and we trust that it will be treated as a matter of considerable urgency. It cannot be left in its present state of uncertainty. We depend a great deal upon the Stock Exchange for a large amount of our security and stability within the City, and if this uncertainty is prolonged it will have considerable implications.
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I am very glad to see that non-executive directors of limited corporate members will be permitted in the future and that lay members will be allowed on the Council of the Stock Exchange. These are very considerable changes and obviously they will meet a good deal of opposition; but it is hoped that the problem will be settled in the foreseeable future. After all, whatever one may say for or against it, the Stock Exchange is a very large contributor of earnings to this country. The effect of this uncertainty particularly on small investors could be quite considerable. They have no means of knowing how they will personally be affected. Also, overseas investors will be affected.
So I hope that Her Majesty's Government will act with the same speed which they have shown in giving us this short report this afternoon, but I also hope that they will give adequate notice of what steps they are going to take. I am sure that they will continually bear in mind that whatever we think of it the Stock Exchange is a very large contributor of finance to our overseas trade.
4.35 p.m.
Lord Cockfield: My Lords, of course I have very considerable sympathy with the point made both by the noble Lord, Lord Bruce of Donington, and by the noble Lord, Lord Mais, about the short time that they have had to consider this matter. There is of course a problem, as noble Lords will appreciate, as one moves towards the Recess in that a large number of Statements are made and are expected to be made. This very often means that the time available is comparatively short. But I do indeed realise how difficult it is when noble Lords are expected to grapple with matters as difficult as this at such short notice.
But may I assure the noble Lord, Lord Bruce of Donington—and I know that he does not really need this assurance—that there has been no question of the Government having leaked this information to the press. From time to time, information reaches the press but it certainly does not do so through leakage by Government. My right honourable friend went to another place and I came here to repeat his Statement as soon as we were in a position to do so.
I greatly appreciate the general welcome of the noble Lord, Lord Mais, for these proposals. We take the view—as he does—that this is the sort of matter which can much better be settled out of court, rather than dragged on for years through a process which might well not result at the end of the day in the right answer being achieved.
Perhaps from that I may go on to the point raised by the noble Lord, Lord Bruce of Donington, who quite rightly drew attention to the fact that the case has been in course for quite a long time. Why, he asks, is there suddenly this move being made now? The answer to that is a very simple one. The whole objective of the restrictive practices legislation is to remove those restrictive practices which are not in the public interest; and, of course, a very large number of cases are settled without ever going anywhere near the court at all.
In the present case, there was a great reluctance on the part of the Stock Exchange to make any movement at all. They explained this in terms of the fact that they

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felt it would prejudice their position before the court if they started making changes. But they have now come to the view that substantial and important changes should be made, and they have proposed those changes to my right honourable friend. This provides a foundation on which we feel that it is possible to settle the case on a basis which removes many of the more important and crucial restrictive practices, without damaging the general position of the Stock Exchange.
I entirely support the point made by the noble Lord, Lord Mais, that this is an institution which earns a very great deal of money, particularly money from overseas. It is a great contributor to our invisible receipts and it is very important that it should be maintained as an efficient organisation. But it is important that it should be competitive and these measures are designed to take it down that path. It is also very important, as the noble Lord, Lord Mais, said, that the position of investors should be safeguarded and that point is made on a number of occasions in my right honourable friend's Statement.
Both noble Lords raised the point of whether there would be a full opportunity for debate. It is stated quite clearly in the Statement that the Government will seek the approval of Parliament for the measures which are needed", and of course that inevitably carries with it the opportunity for full debate on these matters. I entirely agree that there is a degree of urgency about this, because we now want to get ahead. But before the die is finally cast, the measures must be brought to Parliament and that provides a full opportunity for debate. There is no question, if I may use the phrase of the noble Lord, Lord Bruce of Donington, of the Government having "caved in". What in fact has happened is that the Stock Exchange itself has made a very considerable movement in its position. It is on the basis of that change in the position of the Stock Exchange that it has been possible to make the progress which is reported in this Statement.
I note what both noble Lords say about the separation of the functions of brokers and jobbers. The noble Lord, Lord Bruce of Donington, referred particularly to the phrase, "that this should continue for the time being". This is a matter on which I realise that a diversity of views is quite legitimately held, but if there is to be development it should be evolutionary development rather than revolutionary development because a change from single capacity to dual capacity would represent a very, very big change indeed. If it were right for such a change to be made, it should be made in an evolutionary way over a period of time. In other words, this is one of the matters upon which one needs to make progress slowly; but I appreciate the importance of the issue and the fact that both noble Lords have drawn attention to it.
I should also like to refer again—because I believe it answers many of the other points which have been made—to the fact that the Statement specifically says that both the Department of Trade and Industry and the Bank of England will monitor not only the implementation of the measures which are set out in the Statement but also
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"the evolution and development of the Stock Exchange as an efficient, competitive and suitably regulated central market which affords proper protection to investors".
In other words, we want to see this institution develop in a proper way which is to the advantage of both the country as a whole and investors in British industry.
Lord Taylor of Gryfe: My Lords, we on these Benches welcome the Statement and thank the noble Lord for it. We recognise the substantial contribution which is made by City institutions to the economic welfare of the country, particularly to the balance of payments, and we support any measures which are aimed at improving the efficiency and enhancing the reputation of these institutions. That certainly includes the Stock Exchange.
I must express some regret that these concessions have been made at the very last moment, and I should like to ask the noble Lord what is the effect of this withdrawal on the Office of Fair Trading. The noble Lord has said that the concessions by the Stock Exchange have been made with some reluctance. The Office of Fair Trading have been investigating this matter for more than two years, at a cost of £1·5 million. Keeping in mind that the noble Lord has rejected the advice of the Office of Fair Trading on at least six occasions in the past four years, I wonder what the impact of all this is on the standing and reputation of the Office of Fair Trading, which is important to retaining free competition and abolishing agreements which are against the public interest.
We very much welcome the arrangements in connection with negotiated fees. I wonder whether the Government can tell us whether they are satisfied that the proposals put forward by the Stock Exchange will enable the Government and industry as a result of these concessions to raise funds more cheaply and as efficiently as possible, keeping in mind the freedom in the United States Securities and Exchange Commission where Government issues business is bid for. We very much welcome the abolition of the closed shop which is contained in these proposals and the opening up of the Stock Exchange. As supporters of consumer interests, we are also delighted to see that the users of the Stock Exchange will have some voice in the councils of that organisation.
On the question of the separation of jobbers and brokers, the phrase "for the time being" also interests us. I hope that representations will be made by all interested parties before decisions are made. I should also like to ask the Government whether they believe that the maintenance of the single capacity and the introduction of negotiated commissions are compatible, and just what the full impact of that will be. I very much welcome the assurance of the Minister that the decision to depart from these procedures will be the subject of a debate in this House. I very much look forward to it.
Lord Cockfield: My Lords, I am grateful to the noble Lord, Lord Taylor of Gryfe, for the welcome that he has given to so many of these proposals. He expressed some regret that the concessions have been made only at the very last moment. It is so often the case of course that when there is litigation and a case is before the court it is only, as it were, as the parties

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approach the doors of the court that a movement is made towards a settlement. This indeed is what has happened in the present case. That really answers the question which the noble Lord raised about the position of the Office of Fair Trading. It is perfectly true that the Office of Fair Trading have put a very great deal of work into this and that a great deal of money has been spent; but I think it is undeniable that had the case not been brought the Stock Exchange would not have moved in the way that they have. In some ways, the most satisfactory result of any case is to move the parties to a position where a mutually acceptable solution is found. This is what we hope very much will emerge in the present case.
The noble Lord also raised the question whether the abolition of minimum commissions and the facility therefore to negotiate fees would enable funds to be raised more cheaply and efficiently. One of the major objectives of these changes is to increase the efficiency of the Stock Exchange. That in the end should have the kind of effect for which the noble Lord is looking in regard to the costs of raising capital.
The noble Lord also referred to the question of the separation of the functions of jobbers and brokers. I note what he says. I cannot go any further than to say that the Stock Exchange believe—and we share their view—that it would be quite wrong at this stage to abolish the single capacity rule. But we shall have to see how the Exchange develops in the light, inter alia, of developments in other markets elsewhere. This is essentially a matter where if movement is to take place it needs to be movement in an evolutionary sense.
The noble Lord also asked whether the Government believe that the maintenance of single capacity and the abolition of minimum commissions are compatible with one another. We believe that they are. But of course it is a perfectly reputable argument that the abolition of minimum commissions will push in the direction of dual capacity rather than minimum capacity. We are very well aware of that potential repercussion, but again it underlines the point I made earlier: that what we are looking for is evolutionary change on the right lines rather than plunging immediately into dramatic change, which may prove to be right or may prove to be wrong. Having said that, I greatly appreciate the noble Lord's general welcome of the line that the Government are taking.
Lord Boyd-Carpenter: My Lords, in view of what my noble friend has just said as to the advantages in respect of the raising of funds to be expected from the abolition of minimum commission, can my noble friend say why it has been decided that we shall have to wait three and a half years for this advantage to be obtained? I wonder if he can indicate whether, when this measure comes before Parliament, the Government will be prepared to consider an earlier date for the inception of this most welcome reform?
Lord Cockfield: My Lords, I am grateful to my noble friend, particularly for his description of this measure as "a most welcome reform". I believe it is one of the most important of all the reforms; this one and the opening up of the membership, which I think is also crucially important. But here again we come up against the question of how quickly change can be
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made and absorbed by the institutions concerned. This is the date which has been offered by the Stock Exchange. They have promised to make progress towards it without any unreasonable delay and to ensure that by 1986 the minimum commissions will have gone altogether. That seems to my right honourable friend a reasonable rate of progress, given the circumstances we see in front of us. I will, however, report my noble friend's remarks to my right honourable friend.
Lord Denham: My Lords, although this Statement and questions on it have been going on for 32 minutes, it is a very important Statement and it would not be right to cut the House short. But in order to keep ourselves within the rules set by the Companion to Standing Orders, I wonder whether noble Lords will keep to brief questions for elucidation.
Lord Bruce of Donington: My Lords, I shall be greatly obliged if the noble Lord the Minister will answer two purely technical questions which arise. First, there is the question of making regulations under the European Communities Act in order to comply with the EEC directives. Will the noble Lord give an assurance that these regulations will come before the House, under either the positive or the negative procedure; and that when the regulations are laid before the House they will contain the appropriate references, for ease of reference, to the relevant EEC directives? Secondly, under the intention to seek the approval of Parliament, can the noble Lord say whether the approval of the House will take place with the presentation of a Bill to the House to enable this to be done—in which case there can be amendment—or will this matter be presented to the House by way of a regulation, which cannot be amended by the House? I shall be grateful for answers to those purely technical point.
Lord Cockfield: My Lords, so far as the first point is concerned, the regulations under the European Communities Act are bound to be laid before the House. I believe that answers that point. So far as the measures are concerned for which we shall seek Parliamentary approval, it is too early to say precisely in what form they will be taken. There are various possibilities. One is for an order adding to the list of exemptions made in the existing 1976 order I might mention en passant that there are a number of bodies which are exempted in this way, so this is not an unprecedented step. There is the alternative possibility that, if it were necessary, we could propose a short Bill. In either case, Parliament would have an opportunity fully to debate the matter.
Lord Molloy: My Lords, up until now it has all been Front Bench spokesmen and I should like to put in a word for those of us who are not on any Front Bench. I have never been particularly happy with the principle of Statements being made, either in this House or in another place, when they seem to discriminate between Members who are appointed to either House. I believe that is very wrong. The point I have in mind is that Members who are on the Front Benches receive advance notice of what a Statement is going to say. I

1563
see no reason why everybody should not get advance notice.
We are indebted to the noble Lord, Lord Cockfield, for all that he has done in answering difficult questions which he did not know were to come. He has done that in quite a remarkable manner, for which we should all be grateful. However, it would have been much better if we could have had more time. The issue of the Office of Fair Trading is one in which I am deeply interested. In so far as there has been complete denial of the fact that there was any press statement, why was it not possible for the Government to allow the Front Benches to have the Statement early tomorrow, say, so that they could have absorbed it? Then we lesser mortals on the Back Benches, who, it would appear, can absorb points just as quickly as those people on the Front Benches, would have had more time to examine the matters at hand. That would have done credit to the Government and to the Minister, who has done a remarkable job this afternoon. I repeat my thanks, but in so far as we have another two days, I believe that what I have suggested could have been done. We are very fortunate that the noble Lord, Lord Cockfield, has managed to give the information that he has—not so much in repeating the Statment but in the full and comprehensive replies he has given to questions from the Front Benches.
Lord Cockfield: My Lords, I am grateful to the noble Lord, Lord Molloy, for the complimentary statements that he makes. First, we ourselves, of course, rise today—so that, while another place does have a little more elbow room, had the Statement been made tomorrow it would not have been possible for me to have repeated it in your Lordships' House. I assure the noble Lord that we have made the Statement at the earliest possible opportunity. These were important and intricate discussions, which have gone on right up to the present moment. However much one would have liked to do so, it was not possible to give further notice than we have. The Government are always in a more difficult position than the press, because, while it is open to the press to speculate, the information given by the Government has to be the full and accurate information. I hope that the noble Lord will accept that explanation.
Lord Denham: My Lords, I believe that we should probably follow straight on with the next Statement.

Revised Cash Limits 1983–84
4.57 p.m.
Lord Cockfield: My Lords, I beg leave to repeat a Statement made by my right honourable and learned friend the Chief Secretary in another place. The Statement reads as follows:
"With permission Mr. Speaker, I would like to make a statement on the measures to be taken to implement the decisions announced by my right honourable friend the Chancellor of the Exchequer on the 7th July to restrain public expenditure in the current year.
1564
"The gross reduction will be about £670 million. The net total will be somewhat less than this because the lower cash limits will lead to less underspending. But as the Chancellor said on 7th July it will be at least £500 million net. The detailed changes in cash limits and the external financing limits of the nationalised industries are being published in the Official Report."
That ends the Statement, but perhaps I might be permitted to add that, for your Lordships' convenience, copies of the list of revised cash limits will be placed in the Printed Paper Office.
Lord Bruce of Donington: My Lords, we thank the noble Lord, Lord Cockfield, for repeating the Statement made in another place. I am afraid that I have to pursue exactly the same point that I made in regard to the previous Statement. This Statement arrived in my hands not before three o'clock but at twenty minutes to four o'clock, which gave us even less time to make adequate preparations.
The Statement has one considerable disadvantage in so far as Members of this House are concerned; it is that the Statement itself gives no indication of what is contained in the detailed changes. It does not even endeavour to classify them. In fact, the Statement itself adds very little to the Statement made in another place on 7th July. In view of the fact that not all of your Lordships always have an opportunity of going to the Printed Paper Office, it might have been better to have had the Statement reprinted in the Official Report for this place as well as in that for another place. Thereby, it would have been made more easily available to Members generally.
The Statement in its generality only goes to show that the Conservative manifesto was very similar to a number of insurance policies that were issued in the past before some of the remedial legislation was put through, in that the small print on the back of the Conservative manifesto was not made very explicit to the electorate at large. One therefore wonders how far those who were blind enough in the election to vote for the party opposite were fully aware of the import of the small print and that the Government, once elected, intended to make such cuts in cash limits as are now proposed.
One has had little opportunity of going through the Statement which is going to be circulated, except that one knows that so far as the health and personal services are concerned there is to be a cut of some £108 million. There are also in the case of the Department of Transport large cuts on roads, very large cuts in overseas aid, cuts in the Manpower Services Commission of some £22 million, and indeed significant cuts in the field of education and in relation to universities. It is clear that when Parliament reassembles we must have an opportunity of discussing the implications of these cuts in detail. Among other things which we shall be questioning the Government upon is exactly how, and in accordance with what series of priorities, these particular cuts were put forward. We shall want to be assured that they were not made on the basis of the strength of various representations made by competing departments, or departments that did not compete for that matter, but were made on the basis of

1565
an organised plan in which the Treasury did not play a leading part.
May I ask a question which arises specifically from the magnitude of the cuts in the National Health Service? Is the noble Lord aware that, speaking in Edinburgh on 31st May, the Prime Minister is reported as underlining her support for the planned NHS increases in the next three years—£700 million this year, £800 million next year and £700 million in 1985/86. She is quoted as saying:
"… all budgeted for in a sound financial policy; not a promise but a firm commitment."
Will the noble Lord tell the House whether the existing cuts enable that commitment to be fulfilled?
Lord Ezra: My Lords, I should like to join with the noble Lord, Lord Bruce of Donington, not only in expressing concern at the late arrival of the Statement, but even more so at its very exiguous nature. It would have been helpful to us who have to speak on this Statement if we had at least had a summary of some of the reductions to be made, drawing attention to their nature, instead of having the detailed statement put in our hands at this stage.
Your Lordships must be well aware of the grave concern expressed on 7th July when the Chancellor of the Exchequer made in another place his Statement which has given rise to this Statement. It was felt generally in the responsible press and media that this was a panic measure for which no previous indication whatsoever had been given. It was explicitly stated and made known to be Government policy that they would avoid changes in cash limits during the currency of a financial year. As someone who has been for years at the receiving end of cash limits, I can assure your Lordships that nothing is more disturbing than, having laid out your policies to observe limits which were negotiated and agreed upon at a certain stage, then to have them arbitrarily adjusted. So the first question I would put to the noble Lord the Minister is whether we can have any assurance that this arbitrary change in cash limits will not become from now on a regular feature of the Government's conduct of our financial affairs.
The other sad aspect of this affair is that we are, in a patchy way, beginning to emerge from the recession, but a measure of this sort, totally unexpected, a possible precursor of other such measures at short notice, is bound to weaken the slow movement towards recovery. Indeed, as one looks at the list of the areas where the cuts have been made, these are undoubtedly going to have an adverse impact on the move forward towards recovery. It is disturbing also to note some of the areas in which these cuts have been made. If I may refer to the answer given to a question in another place, I would say that it is disturbing to note, at a time when there is a strong feeling that the administration of justice should be strengthened—and of course the noble and learned Lord the Lord Chancellor is involved in this—his department has been cut-back.
Lord Denham: My Lords, I think we are getting a little bit into speeches. There is a certain amount more leeway given to people who are speaking from the Front Benches opposite, but I think we are developing
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rather more into speeches than is really proper for a Statement.
Lord Ezra: My Lords, I regret to be so lengthy, but it is mainly because we were given so little information that I am making a little more of a probing effort. I will certainly now limit my remaining remarks. They are these. I believe, and I would put it to the noble Lord the Minister, that we should have been better served if we had had a longer period for mature reflection on this issue. The sudden introduction of these changes, with a degree of uncertainty as to where we are going in financial policy, has been not only unexpected but I believe harmful. I think some words of reassurance about how these matters will be dealt with in the future would be most helpful.
Lord Cockfield: My Lords, may I start by endeavouring to meet one of the points raised by the noble Lord, Lord Bruce of Donington. I should be only too happy, if it were the wish of your Lordships' House, to include the figures in the Official Report, so that they will be available to everybody in the way that he requests. What this present Statement does, and this is why it is so brief, is that it simply puts the flesh on the bones of the original Statement made on 7th July in another place by my right honourable friend the Chancellor of the Exchequer, and which was repeated in your Lordships' House by my noble friend Lord Gowrie. Most of the points raised by the noble Lord, Lord Ezra, were appropriate to that Statement and not to the present Statement. Indeed, if he refers back to the exchanges which took place on that occasion he will find that most of the points he raised were raised then and answered by my noble friend Lord Gowrie. There is very little that I can add.
The really important point is this. We are not in any way cutting the total of public expenditure which was laid down in the February White Paper. What we are doing is ensuring that expenditure is kept within the limits which we then determined. This was done before the election and all these cards were on the table. There is no question, as the noble Lord, Lord Bruce of Donington, tries to suggest, that people were not aware of the facts. The figures were published in enormous detail in the public expenditure White Paper. What has happened in the last few months is that expenditure has been rising above the levels which were then determined by Parliament. We are now reining back public expenditure to ensure that it keeps on course. Far from this representing any change in policy, it represents exactly the opposite; namely, it is an adherence to a policy which was clearly stated, agreed by Parliament at the time and reinforced since. That is the general background to the situation.
The proposition was that, in broad principle, cash limits should be reduced by 2 per cent. on the non-pay element and 1 per cent. on the pay element. This was also made very clear indeed in the Statement on 7th July and the present Statement shows how that comes out, in fact, in actual figures for individual departments. There are one or two instances where there has been some modification in applying those limits, and I shall refer in a moment to the question of health and social services to which the noble Lord, Lord Bruce of Donington, referred. Also, within each

1567
departmental total, freedom has been left to the individual Secretary of State or Minister to decide how much of the adjustment should fall on one programme as distinct from another. It is for this reason that the figures are set out very fully in the Statement which will now be included in the Official Report.
The position with regard to health is that there was an overrun on the family practitioner service. That is not cash limited. The adjustment on the hospital services cash limit is less than the indicated percentages and the difference has been made up by the reductions in the drug bill which have already been announced by my right honourable friend the Secretary of State for Health and Social Services. The position is that, taking the cash limited and non-cash limited services together, total expenditure on the health services remains unchanged, that expenditure on the health services has increased, in real terms, since 1979 and is still increasing.
I suggest that the right thing now is for the noble Lord to follow the point that he himself very validly made; namely, that he should study the figures and come back again on individual points when he has had the opportunity to do so. I am not trying in any way to be unsympathetic and I entirely appreciate how appallingly difficult it is to master this enormous mass of figures in a short period of time, but it was essential and very right that, the broad statement of policy having been made on 7th July, the very detailed figures which involve an enormous amount of detail should then have been made available to both Houses before the Recess, and that is what we have done.
5.14 p.m.
Lord Diamond: My Lords, does the noble Lord realise that he has succeeded in doing nothing other than cause maximum confusion as a result of the various statements which he has been making on behalf of the Government as regards public expenditure and cash limits? It has become quite impossible to understand why the noble Lord, on behalf of the Government, insists that public expenditure is not being cut back and that all that is being cut back are the payments we make which form the body of public expenditure. It is quite impossible to understand what the logic is behind the noble Lord's statement. Surely when public expenditure was agreed originally and published in the White Paper, to which reference has been made, that public expenditure—
Lord Denham: My Lords—
Lord Diamond: My Lords, the Chief Whip should wait until the end of the sentence. I am asking a question in a very familiar form. He should realise that a most important Statement has been made with totally inadequate time to consider it. We have been given a great wadge of figures which no one can possibly comprehend in time, at a time when there are no Chief Secretaries left in the other place to argue adequately, on behalf of the Oppostition, against what the Government are doing. In all these circumstances and with no promise of a debate it is inevitable that one should seek clarification.
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The clarification I am seeking—and that is the function of this procedure, I hope the Chief Whip will take note—is this. What on earth do the Government mean by maintaining that they are cutting cash limits only and are not cutting public expenditure? Is it the case that those cash limits which have gone beyond control are only those which are, to use a phrase which the Minister will understand, in respect of open-ended commitments? Is it the case that because of the Government's failure to contain unemployment the open-ended expenditure and the cash paid for unemployment relief has gone so far beyond expectations that other programmes have had to bear the brunt of the under-estimation of those open-ended commitments?
I hope I have made it clear that I am seeking clarification on why the Government are maintaining their stance that there is no reduction in public expenditure but only in cash limits when common sense tells us that these cash limits are provided in order to sustain and support the public expenditure figures agreed and adopted by Parliament in the first place. How on earth can this apparent irreconcilable state of affairs exist?
Lord Cockfield: My Lords, I gather that the serried ranks of ex-Chief Secretaries in this House are likely to be strengthened in the not too distant future. Perhaps that will compensate the noble Lord, Lord Diamond, for the fact that the ranks of ex-Chief Secretaries in another place have thinned out very considerably.
The only other comment I make on this is, of course, that public expenditure is primarily a matter for another place and if the noble Lord feels that the Opposition is inadequately represented in another place that is not a matter on which I feel it would be legitimate for me to comment, as regards either numbers or, indeed, quality.
I come to a number of points of substance raised by the noble Lord. Public expenditure broadly falls into two categories. There is cash limited public expenditure and there is public expenditure which is not cash limited. Cash limited public expenditure amounts to about 50 to 60 per cent, of the total. The balance tends to be what is described, often not too accurately, as demand led; that is, expenditure that one cannot estimate in advance. What happened in the early part of this year—this was very fully explained by my right honourable friend the Chancellor of the Exchequer so there is no mystery about it—is, first, that non-cash limited expenditure has increased. It has increased over a substantial field, not only in certain of the social security benefits but also, as I mentioned earlier in reply to a point raised by another noble Lord, in the family practitioner service. Another example is agricultural support, where we have no control over the figure because this emerges from the operations of the common agricultural policy.
Expenditure in those directions having increased, we then have another situation, namely—as the noble Lord will remember from the days when he was Chief Secretary to the Treasury—there is a substantial figure inserted in the Estimates every year for shortfall, that figure representing the amount by which the cash limits are likely to be underspent. Over the years

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departments have become more adept, agile, or able in spending up to their cash limits, and we find a situation where the indication at the moment is that, against a figure of £1·2 billion estimated shortfall, it looks as though the shortfall will be in the region of £600 million only. It is because of those two factors that we have had to make adjustments in the cash limits to ensure that the total amount of public expenditure remains on course. Far from causing the maximum confusion, we are in fact following a very clearly stated and very fully explained policy.
Lord Strabolgi: My Lords, I wonder whether I could ask the noble Lord, or perhaps his noble friend the Minister for the Arts who I see has just joined us, what is to happen about the national museums and galleries. I see that there are to be very substantial cuts, I think amounting to over £100,000 for the British Museum, and cuts to the Victoria and Albert Museum of a similar amount. There is to be a cut of £1 million to the Arts Council, of which the Chairman of the Arts Council has complained very bitterly in the press. Also there are to be cuts of over £1 million to the libraries. I should like to ask how is it contemplated that these cuts will be carried out. Will they be to the purchase grants, to the overheads, or what? Are the cuts to the
Revised cash limits are shown in the following two tables.
Five other cash limit changes are included in the table, as follows:

(i) £1,500,000 has been added to the cash limit for Class X, Vote 3, Universities etc. (Department of Education and Science), to allow for part of the costs of pay awards to clinical academics.

(ii) £4,219,000 has been added to the cash limit for Class XII. Vote 5, administration and miscellaneous services (Department of Health and Social Security), to allow for the additional administrative costs arising from changes in social security benefits announced in the Budget. The net effect of this change and the 7th July measures on this cash limit is a reduction of £2,000,000.

These two increases will be charged to the Contingency Reserve, and will therefore not add to the planning total of public expenditure,

(iii) £250,000 has been added to the cash limit for Class XI, Vote 1, health and personal social services, England. There is a corresponding reduction in the cash limit on new towns' expenditure DoE/NT1. This is to allow a transfer of resources from Peterborough new town to the district health authority. There is no net increase in public expenditure.

(iv) The cash limit for Class I, Vote 1, Defence—pay etc. of the armed forces and civilians, stores, supplies and miscellaneous services, has been reduced by £370,000 to allow for a transfer to Class II, Vote 2, international subscriptions (Foreign and Commonwealth Office), which is not subject to a cash limit.

(v) £15,000,000 has been added to the cash limit for Class VIII, Vote 7, Urban Development Corporations, England, to allow for a transfer of urban programme resources originally earmarked for urban development grant within the non-voted cash block DoE/LA1. DoE/LA1 has been reduced by the same amount, so there is no net increase in public expenditure. The effect on the cash limit for Class VIII, Vote 7 of this change and the 7th July reduction is a net increase; all the other changes shown in the table are reductions.

CENTRAL GOVERNMENT CASH LIMITS 1983–84, FOLLOWING THE REDUCTIONS ANNOUNCED BY THE CHANCELLOR ON JULY 7th

Table 1: Voted cash limits

Class

Vote

Accounting department

Description of expenditure

Cash Limit as at 7th July £ thousand

Reduction £ thousand

Revised cash limit £ thousand

I

1

Ministry of Defence

Pay etc. of the armed forces and civilians, stores, supplies and miscellaneous services

6,123,554

60,370

6,063,184

2

Ministry of Defence

Defence procurement

7,556,780

160,000

7,396,780

(a)

4

Property Services Agency

Defence accommodation services etc.

915,815

15,000

900,815

5

Ministry of Defence

Dockyard services

426,825

5,000

421,825

II

1

Foreign and Commonwealth Office

Overseas representations: diplomatic, consular and other foreign and commonwealth services

333,509

4,000

329,509

3

Foreign and Commonwealth Office

British Broadcasting Corporation: external services

77,082

500

76,582

libraries to include the cuts to the new British Library which is being built? What is to happen to conservation, and so on? Are these not the first cuts that have ever been made since the war to our national museums and galleries? What is to be the effect of them? Do the noble Lord and his noble friend remember the position of the British Museum? Are they going to guarantee that the nation's heritage and art treasures will not be prejudiced by this kind of reduction?
Lord Cockfield: My Lords, the noble Lord, Lord Strabolgi, raises a large number of specific points. While the museums and galleries have had to make their contribution to the correction of the threatened overspend, my noble friend Lord Gowrie has been able to limit that contribution to 1 per cent, in general in respect of arts bodies. This is due to a temporary deferment of the building start on the theatre museum. My noble friend is very hopeful that, in spite of this, a start on the theatre museum in the fiscal year may prove to be possible. So far as the other points made by the noble Lord are concerned perhaps I or, more appropriately, my noble friend, might write to him.
Following is the information referred to in the above Statement:

Class

Vote

Accounting department

Description of expenditure

Cash Limit as at 7th July £ thousand

Reduction £ thousand

Revised cash limit £ thousand

4

Foreign and Commonwealth Office

British Council

40,383

500

39,883

6

Cabinet Office

Other external relations: secret service

71,500

715

70,785

8

FCO: Overseas Development Administration

Overseas aid

1,027,363

19,691

1,007,672

9

FCO: Overseas Development Administration

Overseas aid administration

25,444

210

25,234

III

3

Ministry of Agriculture Fisheries and Food

Other agricultural and food services

97,824

2,932

94,892

5

Ministry of Agriculture, Fisheries and Food

Support for the fishing industry

26,703

500

26,203

6

Forestry Commission

Forestry

59,361

879

58,482

7

Ministry of Agriculture, Fisheries and Food

Departmental administration

193,198

350

192,848

IV

2

Department of Trade and Industry

Miscellaneous support services

32,492

650

31,842

4

Department of Trade and Industry

Export promotion, trade co-operation, corporate and consumer affairs

196,377

200

196,177

5

Department of Energy

Industrial support

85,283

1,680

83,603

6

Department of Trade and Industry

Scientific and technological assistance

330,252

7,933

322,319

7

Department of Energy

Scientific and technical assistance: nuclear energy

210,291

2,850

207,441

9

Export Credits Guarantee Department

International trade: export credit services and insurance of investment overseas (central services)

25,855

223

25,632

11

Registry of Friendly Societies

Registry of Friendly Societies

1,695

18

1,677

12

Office of Fair Trading

Office of Fair Trading

6,609

53

6,556

13

Department of Employment

Labour market services

498,072

3,791

494,281

16

Department of Employment

Manpower Services Commission

1,230,791

22,036

1,208,755

17

Department of Employment

Administration

186,722

2,472

184,250

18

Department of Industry

Central and miscellaneous services

75,653

150

75,503

19

Department of Energy

Administrative and miscellaneous services

24,046

206

23,840

22

Department of Energy

Sale of British Gas Corp. oil interests

4,000

80

3,920

23

Department of Employment

Health and Safety Commission

87,873

100

87,773

VI

1

Department of Transport

Roads, etc., England

732,308

14,869

717,439

2

Department of Transport

Transport services and central administration

114,660

1,578

113,082

4

Department of Transport

Driver and vehicle licensing

99,896

1,086

98,810

VIII

2

Department of the Environment

Central environment services, etc.

118,202

1,500

116,702

4

Department of the Environment

Royal palaces, royal parks, historic buildings, ancient monements and the national heritage

72,423

340

72,083

5

Department of the Environment

Central administration and environmental research

170,313

1,508

168,805

7

Department of the Environment

Urban Development Corporation, England

66,645

14,004(b)

80,649

Class

Vote

Accounting department

Description of expenditure

Cash Limit as at 7th July £ thousand

Reduction £ thousand

Revised cash limit £ thousand

IX

1

Lord Chancellor's Department

Administration of justice: England and Wales

86,155

468

85,687

2

Northern Ireland Court Service

Administration of justice: Northern Ireland

7,942

121

7,821

7

Home Office

Services related to crime, treatment of offenders, community and miscellaneous services

39,850

651

39,199

8

Home Office

Prisons: England and Wales

537,245

6,912

530,333

9

Home Office

General protective services and civil defence: England and Wales

79,550

1,013

78,537

11

Home Office

Central and administrative services

164,698

1,468

163,230

12

Treasury Solicitor's Department

Law charges, England and Wales

10,817

94

10,723

13

The Crown Agent

Law charges, Scotland

12,013

110

11,903

X

1

Department of Education and Science

Schools

180,089

5,786

174,303

3

Department of Education and Science

Universities, etc.

1,441,559

23,100

1,418,459

4

Department of Education and Science

Central administration

47,318

856

46,462

12

Trustees of British Museum

British Museum

12,536

125

12,411

13

Office of Arts and Libraries

Science Museum

7,728

77

7,651

14

Office of Arts and Libraries

Victoria and Albert Museum

10,456

104

10,352

15

Trustees of Imperial War Museum

Imperial War Museum

4,140

41

4,099

16

Trustees of National Gallery

National Gallery

6,797

68

6,729

17

Trustees of National Maritime Museum

National Maritime Museum

4,080

41

4,039

18

Trustees of National Portrait Gallery

National Portrait Gallery

1,789

18

1,771

19

Trustees of Tate Gallery

Tate Gallery

5,375

54

5,321

20

Trustees of Wallace Collection

Wallace Collection

791

8

783

21

Office of Arts and Libraries

Art, Arts Council, etc.

109,359

1,059

108,300

22

Office of Arts and Libraries

Libraries: England

46,299

1,022

45,277

XI

1

Department of Health and Social Security

Health and personal social services: England

8,539,250

108,108(c)(d)

8,431,142

XII

5

Department of Health and Social Security

Administration and miscellaneous services

713,022

2,000

711,022

XIII

3

Privy Council Office

Parliament and Privy Council: Privy Council Office

917

8

909

4

HM Treasury

Economic and financial administration

42,876

386

42,490

5

Customs and Excise

Economic and financial administration

321,011

2,964

318,047

6

Inland Revenue

Economic and financial administration

751,919

3,904

748,015

10

Department for National Savings

Economic and financial administration

143,347

1,413

141,934

12

Management and Personnel Office

Central management of the Civil Service, etc.

30,885

261

30,624

13

HM Treasury

Central management of the civil service: computers and telecommunications

11,380

107

11,273

14

HM Treasury

Civil service catering services

301

6

295

15

Public Record Office

Records, registrations and surveys

8,496

38

8,458

Class

Vote

Accounting department

Description of Expenditure

Cash Limit as at 7th July £ thousand

Reduction £ thousand

Revised cash limit £ thousand

16

Office of Population Censuses and Survey

Records, registrations and surveys

23,889

194

23,695

17

Land Registry

Records, registrations and surveys

65,140

663

64,477

18

Charity Commission

Records, registrations and surveys

4,865

46

4,819

19

Cabinet Office

Other services

13,996

106

13,890

20

The Office of the Parliamentary Commissioner and Health Service Commissioners

Other services

1,696

12

1,684

21

Her Majesty's Stationery Office

Stationery and printing: Payments to the trading fund

7,386

148

7,238

23

Ordnance Survey

Records, registrations and surveys

17,275

381

16,894

XIV

1

Property Services Agency

Civil accommodation repayment

278,168

4,677

273,491

3

Property Services Agency

Other civil accommodation services

165,207

6,611

158,596

4

Central Office of Information

Publicity

49,081

780

48,301

7

Government Actuary's Department

Other common services

1,030

6

1,024

8

Paymaster General's Office

Other common services

10,360

109

10,251

XV

2

Department of Agriculture and Fisheries for Scotland

Agricultural services and fisheries: Scotland

58,889

946

57,943

3

Scottish Economic Planning Department

Regional and general industrial support: Scotland

132,276

2,476

129,800

4

Scottish Economic Planning Department

Manpower Services Commission, Scotland

140,077

2,308

137,769

6

Scottish Development Department

Roads, transport and environmental services, etc.

148,003

4,852

143,151

14

Scottish Home and Health Department

Prisons, hospitals and community health services, etc., Scotland

1,360,496

16,382(d)

1,344,114

15

Scottish Education Department

Education, libraries, arts and social work: Scotland

112,744

921

111,823

17

Trustees of National Library of Scotland

National Library of Scotland

2,782

38

2,744

18

Board of Trustees National Galleries of Scotland

National Galleries of Scotland

2,709

42

2,667

19

Board of Trustees National Museum of Antiquities of Scotland

National Museum of Antiquities of Scotland

799

11

788

21

Scottish Record Office

Scottish Record Office

1,445

12

1,433

22

Registrar General's Office: Scotland

General Register Office for Scotland

3,895

43

3,852

24

Scottish Office

Scottish Office administration

94,225

510

93,715

XVI

1

Welsh Office

Tourism, roads and transport, housing, other environmental services, education, libraries, arts, health and personal social services. Wales

717,123

7,039(d)

710,084

4

Welsh Office

Manpower Services Commission

72,335

1,193

71,142

5

Welsh Office

Agricultural services, support for the fishing industry, regional and industrial development, Wales

56,215

3,737

52,478

7

Welsh Office

Other services

31,189

283

30,906

Class

Vote

Accounting department

Description of expenditure

Cash Limit as at 7th July £ thousand

Reduction £ thousand

Revised cash limit £ thousand

XVII

1

Northern Ireland Office

Law, order, protective and miscellaneous services

389,715

5,000

384,715

XVIII

15

Crown Estate Office

Crown Estate Office

1,681

14

1,667

Notes:
(a) The four cash-limited defence votes are each separate cash limits, but by agreement with the Treasury they arc managed as a global cash limit.
(b) In the case of this vote the £14,004,000 is an increase rather than a decrease to the cash limit. The increase of £15,000,000 a transfer from DOE/LAI is partly offset by the reduction following the July 7th announcement.
(c) Expenditure on the NHS as a whole in England will remain at planned levels.
(d) In addition to the reductions on cash limited health expenditure there will be a saving of £25m in health expenditure resulting from savings in the NHS drugs bill agreed to by the pharmaceutical industry in the current year.

Table 2: Non-voted cash Limits

Department

Cash block

Description of expenditure

Cash limit as at 7th July £ million

Reduction £ million

Revised cash limit £ million

Bank of England

BoE 1

Bank of England administrative costs in respect of note issue, exchange equalisation account and debt management

77·9

1·1

76·8

Department of the Environment

DoE/HCl

Capital expenditure in England on housing financed through the Housing Corporation

630·0

9·6

620·4

Department of the Environment

DoE/LAl

Capital expenditure in England by local authorities on roads and transport, housing, schools, further education and teacher training, personal social services, the urban programme and other environmental service.

2,964·7

15·0

2,949·7

Department of the Environment

DoE/NT 1

Capital expenditure in England by new towns on housing, roads and commercial and industrial investment

67·3

5·3

62·0

Scottish Office

SO/LA2

Capital expenditure in Scotland on housing by local authorities, new towns, the Scottish Special Housing Association and on schemes financed by the Housing Corporation, and industrial and commercial investment by new towns.

447·1

2·7

444·3

Welsh Office

WO/LA 1

Capital expenditure in Wales by local authorities, new towns and the Housing Corporation on roads and transport, housing, schools, further education and teacher training, personal social services, and other environmental services, and by the Land Authority for Wales.

299·5

0·9

298·6

Northern Ireland Departments

NID 1

Services analogous to Great Britain services covered by cash limits

1,975·4

6·9

1,968·5

Note:
Figures may not add due to rounding.
Revised external financing limits (EFLs) for nationalised industries in 1983–84 are set out in the following table.

£ million cash 1983–84(1) EFL

National Coal Board

1,195

Electricity (England and Wales)

-418

North of Scotland Hydro-Electric Board

-2

South of Scotland Electricity Board

274

British Gas Corporation

-43

British National Oil Corporation(2)

-1

British Steel Corporation

321

British Telecom

-117

Post Office

-51

National Girobank

-½

British Airways Board

1

British Airports Authority

32½

British Railways Board

953

British Waterways Board

41

National Bus Company

65

Scottish Transport Group

18½

British Shipbuilders

158

Civil Aviation Authority

21

(1) All EFLs have been rounded as appropriate.
(2) The figure for BNOC is not a limit. BNOC's trading results are likely to fluctuate from year to year given the uncertainties of oil trading.
There are also revised EFLs for certain other bodies. These are as follows:

£ million cash 1983–84(1) EFL

Water Authorities (England and Wales)

359½

Urban Development Corporations

81(2)

(1) All EFLs have been rounded as appropriate.
(2) Includes a reduction of 2 per cent. (£1.3 million) in the previously announced limit and a transfer to the Urban Development Corporation of £15 million of resources previously earmarked for urban development grants within the local authority cash limit.

The Gibraltar Dockyard
5.23 p.m.
Lord Trefgarne: My Lords, with your Lordships' permission, I should like to repeat a Statement being made in another place by my honourable friend the Under-Secretary of State for Defence Procurement. The Statement is as follows:
"Following close consultation and detailed discussions between Her Majesty's Government and the Government of Gibraltar on the arrangements for the closure of the Royal Naval Dockyard at Gibraltar, the establishment of a commercial ship repair yard to take its place, and certain related matters, the Government of Gibraltar have agreed to recommend to the Gibraltar House of Assembly, and to support fully, the terms which have been agreed between us. The Chief Minister of Gibraltar is proposing a Motion to this effect in the house of Assembly this afternoon.
"The Royal Naval Dockyard will now close by 31st December 1984, a year later than originally envisaged. To this end a state of redundancy will be declared in respect of the rundown of the Royal Naval Dockyard on 1st September 1983. Individual
redundancy notices will be issued thereafter as appropriate. Full redundancy payments will be made. It has been agreed with the Gibraltar Government that, following closure of the Royal Naval Dockyard, the yard will re-open immediately as the Gibraltar Ship Repair Company which will be a commercially managed enterprise with A & P Appledore International Ltd. acting as managers on behalf of the Gibraltar Government.
"Associated with the closure of the naval dockyard and the establishment of a commercial yard, Her Majesty's Government have agreed on a number of measures of support to the Gibraltar economy. The land and assets for the commercial ship repair yard will be handed over free of charge to the Gibraltar Government. A total of up to £28 million will be provided to meet the initial cost of conversion, working capital and operating losses, if any, in the first two years of commercial operation of the new yard. These funds will be committed only after satisfactory assurances have been obtained by the commercial operator from the work force on new working practices. Subject to those assurances, funds could be disbursed before closure of the naval dockyard. The flow of funds thereafter will depend on the maintenance of these working practices.
"During the first three years of operation of the commercial yard, work will be provided by the Ministry of Defence on Royal Fleet Auxiliary vessels to the value of £14 million at current prices. Work will also be available on other Ministry of Defence vessels to the approximate value of £0.5 million to £1 million per year. In addition the Ministry of Defence is leasing accommodation to the Gibraltar Ship Repair Company for use by management staff so as not to throw an additional burden onto Gibraltar's scarce stock of housing.
"Agreement has been reached on new arrangements for the transfer of surplus defence land to the Gibraltar Government. The Ministry of Defence has also undertaken to release to the Gibraltar Government a number of sites which will facilitate the development of tourist and commercial facilities on the Rock. Release will take place when present facilities on these sites have been reprovided elsewhere and when the Gibraltar Government are ready to proceed with development. In addition, the Ministry of Defence has agreed to review its long-term property requirements to see what other sites might in future be available for transfer to the Gibraltar Government.
"If there are any future difficulties for the Gibraltar economy, Her Majesty's Government would be prepared, in line with the policy of supporting Gibraltar during the present border restrictions, to look at the whole economic and budgetary situation with a view to considering whether, and if so what, further measures of support might be necessary or justifiable in the circumstances of the time.
"The closure of the Royal Naval Dockyard at Gibraltar inevitably poses great problems of readjustment for those who work there and for the economy as a whole. Nevertheless, given the substantial measures of support which I have announced, both for the dockyard and for the broader development of the economy, I am confident that the establishment of a commercial yard will provide a real opportunity for Gibraltar and its people to create a viable and effective alternative".
My Lords, that concludes the Statement.
Lord Bishopston: My Lords, may I thank the Minister for repeating the Statement made in the other place. Is he aware that there is concern that the practice of Statements on important policy matters such as this being made as the House goes into recess allows no opportunity for the House to examine matters in more detail and to debate the various aspects?
Although according to the Statement the Government of Gibraltar support fully the terms of the agreement, is it not a situation where they have no alternative but to accept what is really the doctrinaire policy of Her Majesty's Government, which may not contribute to a sensible overall Mediterranean foreign and defence policy? The Statement says that the £28 million of aid and funds:
"will be committed only after satisfactory assurances have been obtained by the commercial operator from the work force on new working practices".
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and:
"will depend on the maintenance of these working practices".
May I ask whether consultation has taken place with the trade unions and the work force; and, if so, with what result? Has there been any welcome for the proposal? Is it not also in addition dependent on the acceptance of 900 redundancies? The Statement later says that there is also the possibility of "great problems of re-adjustment".
On 19th July, at col. 177 of the Official Report, the Prime Minister stated in another place:
"we have made it clear to the Spanish Government that we have a firm commitment in respect of the wishes of the people of Gibraltar, as enshrined in the Gibraltar constitutional document".
Can we be told what those commitments are and how this Statement is compatible with them?
Since, as reported in the next column (col. 178), the Prime Minister said,
"Spain cannot enter the EC until the restrictions on the border between Spain and Gibraltar are lifted",
can we be told whether the European Community has been consulted about the contents of the Statement, and, if so, with what result? Clearly, as the Prime Minister indicated in her reply to questions on Gibraltar on 19th July in the other place, these policy changes will affect relations with Spain. Can we be told whether the Lisbon Agreement will be fully implemented, and does this Statement help towards that situation? Also—and this is of great importance —have our NATO allies been informed of the details of the Statement, and is there agreement with what the Government intend to do?
Finally, will Her Majesty's Government be surprised if, as in the case of the Falklands, the Spanish Government get the wrong message, and is there not here the beginning of yet another very heavy financial and long-term commitment, arising from this policy Statement?
Lord Mayhew: My Lords, I thank the noble Lord for repeating the Statement. May I ask, first, for some detail about the redundancies? How many redundancies will there be? How many of those made redundant will be taken on by the United Kingdom Government, especially in the base at Gibraltar, and how many will be taken on by the new company? May I ask what is to be the future position regarding local employment in the base? And how does NATO view the base? Have we had assurances of the value that NATO places on the naval base?
May I ask what provision has been made for continuing the capacity for major naval ship repairs in the new ship repairing unit? We were told about a very small, three-year arrangement, but can the noble Lord not reassure us that there will be a continuing capacity for emergency naval ship repairs? Finally, may I ask what is the value of the land and assets and the surplus defence land being transferred? I should be obliged to the noble Lord if he will answer those questions.
Lord Trefgarne: My Lords, I am grateful to both noble Lords, and I shall endeavour to answer as many as possible of the points which they have put to me. The noble Lord, Lord Bishopston, first asked me about consultation with the trade unions. As the noble

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Lord will know, the trade unions are very adequately represented within the House of Assembly in Gibraltar, and they are fully aware of what is going on. I should not want anything that I have said today to detract from the commitment that we have long made with regard to Gibraltar in her present difficulties concerning the border, which I think is well known to the noble Lord; and there is certainly no change in our position on that.
This is not specifically a matter for the European Community, because the main purpose of these arrangements is to rationalise the dockyard capacity available to the Royal Navy; that is why we have though it right to make these arrangements. Indeed, that is why this is not really a matter for NATO, since all the members of NATO make their own national provision with regard to the maintenance and repair of their ships.
The naval base in Gibraltar, which is quite separate from the naval dockyard, is indeed a facility used by NATO, and there is of course no change in the arrangements there. Indeed, 200 of the staff currently working at the dockyard will be taken on at the naval base, leaving about 900 people immediately redundant from the dockyard; but a number of those—at least 300—will be taken on as soon as the dockyard reopens, and for them at least therefore, there will be more or less continuity of employment. We expect that a large additional number of personnel from the dockyard will be taken on by the new commercial managers. I cannot be specific as to quite how quickly that will happen. It will depend how quickly the capability of the dockyard builds up, and in particular on how quickly it is possible to bring into effect the new working practices which have been referred to.
Both noble Lords asked me, too, about the importance of this matter with regard to the Lisbon Agreement. So far as the British Government are concerned, we are now able and willing to implement the Lisbon Agreement. It remains only for the Spaniards to implement their side of the agreement, and I hope that they will agree to do that very soon. We have a formal agreement with the Spaniards, and we now look to them to honour their side of it. In that context, there is really no question of any message, good or bad, being sent to the Spaniards in regard to this matter. Our naval posture in Gibraltar remains, as I say, unaffected.
The noble Lord, Lord Mayhew, also asked me about the value of the lands being transferred. I must tell him that it is very difficult to arrive at a proper value for the lands because the market forces in Gibraltar are particularly unusual. I do not have a figure I could give him that I think would be at all meaningful.
The noble Lord also asked me about the capacity of the dockyard and the future capability in regard to looking after Royal Navy ships. As was indicated in the Statement, for the first three years the dockyard will be seen to work on certain Royal Fleet Auxiliary vessels, and it certainly will be possible for us to use the dockyard after that if we so require.
Lord Boyd-Carpenter: My Lords, my noble friend told your Lordships that the government of Gibraltar were recommending acceptance of this arrangement to the Gibraltar House of Assembly this afternoon, but can he confirm that Sir Joshua Hassan and his colleagues have made it absolutely clear that they would infinitely prefer the continuance of the operation of the historic naval dockyard? Is my noble friend also aware, as was suggested by the noble Lord opposite, that there is an unhappy connection—psychological, perhaps, in some people's minds—between this step and the really disastrous decision last year by the Ministry of Defence to withdraw the Arctic patrol ship "Endurance" from the Arctic, which was undoubtedly understood by certain people in the Argentine as being an indication of at least diminished British concern with the Falkland Islands?
Is my noble friend aware that in view of what would be the disastrous consequences of creating any similar impression in Spanish minds, the taking of this step and the closure of the dockyard make it all the more incumbent on Her Majesty's Government to be brutally clear to the Spanish Government that there is, and can be, no question of even discussing the handing over of sovereignty of Gibraltar to any country—Spain or anybody else—without the consent of the people of that loyal colony?
Lord Trefgarne: My Lords, I can certainly confirm what the noble Lord asked me in the last part of his remarks. As I said earlier, the Lisbon Agreement is already in force, and it paves the way to settle all outstanding differences. That is perhaps the fundamental difference between this situation and the situation which prevailed last year elsewhere in the world, in particular in the South Atlantic. We have an agreement with the Spanish Government over ending the restrictions on the border at the frontier with Gibraltar, and that agreement also provides for subsequent discussions on anything which the Spaniards seek to raise. So I do not think that the situation is in any way parallel. In any event, as I say, the NATO posture in Gibraltar remains unaffected.
Lord Boyd-Carpenter: My Lords, will my noble friend answer my first question as to the attitude of Sir Joshua Hassan and the Gibraltar Government?
Lord Trefgarne: My Lords. I apologise for not answering that question. Sir Joshua appears to be very happy with the arrangements that have been reached. No doubt he would have preferred the Royal Naval Dockyard to have remained forever exactly as it is, but I am afraid that that was not one of the possibilities open to us. It was clearly very much part of the excess capacity that we had apprehended in the Royal Naval Dockyard system generally, and I think that Sir Joshua is well pleased with the agreement that he has reached with the British Government.
5.40 p.m.
Lord Kilmarnock: My Lords, we should like to thank the noble Lord for repeating the Statement. I wish to put one or two questions. The Statement refers to a total of up to £28 million that will be provided to

1585
meet the initial cost of conversion. It is not made clear in the Statement whether that will be in the form of a loan or subsidy. The noble Lord can perhaps clear that up.
The work that is likely to come from the Ministry of Defence is mentioned in the Statement. I wonder whether the noble Lord has any news of any other work in prospect. I have considerable doubts about the viability of this enterprice. That does not mean that we do not wish it fair wind. On jobs, priority should obviously be given to those who have been made redundant by the closure of the dockyard. But will the Government, if the enterprise goes well, give some consideration to encouraging the Gibraltar Government to offer some work permits for Spanish workers? Do the Government not agree that this would be the best way of improving relations with the mainland leading to full implementation of the Lisbon Agreement?
Lord Trefgarne: My Lords, I think that the last point is a matter for the Gibraltar Government and not for me. In the first part of his supplementary question, the noble Lord asked about the terms on which the money would be made available. As I said in the Statement, subject to the implementation of the improved working practice referred to, the money will be made available on grant terms. There is no question of a loan being involved in this case. The work that we are providing will, in the early months and years of the new commercial dockyard, be substantially all that it can cope with. I hope therefore that by the end of that time it will be in a position to take on a good deal of other outside commercial work.
Lord Bishopston: My Lords, may I follow up the Minister's replies to my own and other supplementary questions. I am sure that there is a feeling of some doubt about the Government's knowledge of the meaning of the word "consultation". It seems that what the Government mean by consultation is just telling people what they have decided, whereas true consultation is telling people what you have in mind, asking their views and being prepared to modify your plans. In the case of NATO, the EEC, the Lisbon Agreement and in relation to the noble Lord's question about the experience of the Falklands, there is still an element of doubt. I believe that the House will go into the Recess with a feeling that the wording running through the Gibraltar Rock is one of compromise which will cost us dearly in the future.
Lord Trefgarne: My Lords, cost us dear it will, in terms of £28 million—
Lord Bishopston: That is the beginning.
Lord Trefgarne:—over the next three years or so. That is a substantial amount of money. The Gibraltar community is of course important; but a fairly small community nonetheless by our standards in terms of the number of people living in Gibraltar. I believe that we have provided them with a very effective and appropriate package for the problems that they have put to us. As I have stated, Sir Joshua Hassan is entirely happy apparently with the arrangements.
Lord Merrivale: My Lords, while welcoming the Statement, particularly that part which states that the closure of the naval dockyard will be delayed by one year, may I ask my noble friend the Minister whether his attention has been drawn to the July report on Gibraltar maritime policy drawn up by the Gibraltar branch of the British Maritime League, referred to in an article in the Daily Telegraph by Desmond Wettern, its naval correspondent, last Monday? Would he care to comment on one or two of the statements made in the report and referred to in the article; namely, that over the period of a decade and a half, there has been a falling offin the number of ships calling in at Gibraltar of 50 per cent; while on the other hand, there has been an increase in the number of ships calling in at the port of Algeciras to an extensive degree? Does my noble friend not consider that the developing ship repair yard at Algeciras will pose a threat to the future of the Gibraltar Ship Repair Company when it comes to be constituted in early 1985? In other words, does he not feel that the number of ships that might be willing to call into Gibraltar for repair might desire instead to go to Algeciras and that this would be regrettable?
Lord Trefgarne: My Lords, it will of course be necessary for the new commercial shipyard in Gibraltar to operate on an efficient and competitive basis. I have no doubt that under the new arrangements it will do so. The facilities at Algeciras to which my noble friend refers are I understand, fairly modest; but I do not think that the Gibraltar shipyard will be afraid of genuine competition.
Lord Hatch of Lusby: My Lords, I think that the noble Lord will agree that this is an extremely generous package to Gibraltar, much more generous than the Government have shown themselves towards dockyards closing in this country. I should like to ask two specific questions. Is the sum in the grant, of up to £28 million, to come out of the British provision for overseas aid? If so, although, presumably, he does not have the figures, can the noble Lord publish the figures showing how much per capita this means in terms of overseas aid provision to the population of Gibraltar? Secondly, can he say whether there have been any consultations between Her Majesty's Government and the democratic and socialist Government of Spain before this arrangement was finalised? If so, what comments have the Government of Spain made over the package as a whole?
Lord Trefgarne: My Lords, the population of Gibraltar is something in the region of 20,000. If the noble Lord's agile brain can divide 28 million by 20,000, he will arrive at the figure which he requested in the first part of his supplementary question. As to consultation with the Spanish Government on the matter, I do not think that this would have been appropriate in this case, and it did not take place.
Lord Hatch of Lusby: My Lords, that really does not answer the question. Is this money coming out of our overseas aid? I can divide 28 million by 20,000, but how does that compare with the average per capita aid that is given by this country to the developing world as a whole?
Lord Trefgarne: My Lords, I think that I can answer that supplementary in one word: generously. I can also say that the sum of £28 million does indeed come from the overseas aid budget.

Sex Discrimination Act 1975 (Amendment of Section 20) Order 1983
5.48 p.m.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur)The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur) rose to move, That the draft order laid before the House on 22nd June be approved.
The noble Lord said: My Lords, this order is about the training and employment of men as midwives. It is one of two orders which will lift the present restrictions on training and employment of men as midwives. The other order follows the negative resolution procedure, but I shall speak more of that later.
The background is that before 1975, men were barred from the midwifery profession. A midwife was defined as a woman certified under the Midwives Act. The Sex Discrimination Bill in 1974 led the Government to look closely at all areas of employment where some form of discrimination existed. One such area was that of midwifery practice, and the Government sought the views of the statutory and professional bodies concerned with midwifery.
The views expressed at that time were that male midwives would not be readily acceptable. The Royal College of Midwives and the Royal College of Obstetricians and Gynaecologists were against the admission of men and the British Medical Association and the Royal College of Nursing had reservations about midwifery for men. In particular, the college said that women should be able to choose the sex of their midwives, and that male midwives would have to be chaperoned.
The outcome of this was that the 1975 Sex Discrimination Act, which amended the 1951 Midwives Act, allowed men to enter the profession subject to certain transitional provisions. These were that, until a day specified by order, the training and practice should be restricted to only those centres approved by the Secretary of State. The second order which I have mentioned—the Sex Discrimination (Midwives) (Specified Date) Order—will specify the date when it is proposed that the transitional provisions should end. The Sex Discrimination Act also provided, in Section 20, that the provisions of the Act concerning discrimination in the field of employment and training did not apply to midwives. The order under debate has the effect of ending this on 1st September this year.
The background to removing the present restriction is that following the 1975 Act two centres were approved for male midwifery training. In order to be able to assess future developments, these experimental courses were closely monitored and an assessment was made to find out how acceptable male midwives were.
The report of the assessment of the two centres was published by my Department in 1982. This concluded that male midwives were generally acceptable. It was however found that certain women preferred to be cared for by female midwives and students, and also
1588
that some women did not wish intimate nursing procedures to be carried out by a male midwife. The report showed chaperoning not to be a major problem; and on competence and practical work, male students were found to be as good as female students.
In view of these findings the Government decided to consult widely on the report, and those consulted were asked in particular to express views on the possibility of lifting the present restrictions on training and employment of men as midwives. This consultation showed a broad consensus of opinion in favour of lifting the restrictions, although this was again qualified by the two major considerations which had been expressed by the Royal College of Nursing in 1974. These were that women should be able to choose to be attended by a female midwife if they so wish, and that provision should be made for men training or employed as midwives to be chaperoned as necessary.
As a result of this consultation the Government concluded that they should proceed to amend the 1975 Act to allow men to train and practise as midwives on equal terms with women. In addition to agreeing to the preparation of the two orders, the Government agreed that provisions must also be made for women to opt to be attended by a female midwife, and for chaperons to be provided as necessary. Health departments are therefore preparing guidance to health authorities, in conjunction with the orders, to ensure that these safeguards are met. The Equal Opportunities Commission were consulted before the orders were presented to the House. The commission welcome the effect of the orders.
I should finally mention one slight problem that has arisen over the proposed legislative changes in respect of male midwives. It does not affect the order that we have under discussion today, but rather the other order—the Sex Discrimination (Midwives) (Specified Date) Order—which it was proposed should be made in conjunction with the amendment of the Section 20 Order to come into operation on 1st September. The specified date order followed the negative resolution procedure, but because of the date of the Recess it cannot lie for the required statutory 40 days; and it therefore cannot be made.
However, health authorities will not be debarred from training men or offering employment to a male midwife after 1st September. This will be achieved by using the Secretary' of State's powers under Schedule 4 of the 1975 Act to approve any place which wishes to train or employ male midwives. By these administrative means the Government will put into effect their commitment to introduce the new arrangements on 1st September. The specified date order will be laid again in the autumn to come into operation on 1st January 1984.
My Lords, with that explanation, I beg to move.
Moved, That the draft order laid before the House on 22nd June 1983 be approved.—(Lord Glenarthur.)
Baroness Jeger: My Lords, we appreciate the clear way in which the Minister has dealt with this rather difficult problem and we are roughly in agreement with what he has said. However, I must ask him if he can assure the House that, when he savs that women

1589
will be given a choice, that will be a choice in reality. It seems to me that, if a male midwife happens to be on duty and a female midwife is off duty, the choice will be very unreal for the woman concerned. There may well be circumstances in which pressure will be put on women to the effect that they are being unco-operative in insisting on what the Minister has said is their right.
So I suggest that the practical answer here would be that these schemes should be concentrated in the larger hospitals where there is likely to be a selection of midwives on duty so that if a woman insists on having a woman midwife, the chances of that request being met will be greater than in a small hospital where there may only be a couple of midwives each taking turn and turn about. Those are my main hesitations. I would be glad if the Minister would confirm that in his communications with health authorities he will make it a paramount condition that those rights which he has spelled out in theory will be put into practice.
Baroness Phillips: My Lords, before the Minister replies I should like to follow up that point—
Lord Skelmersdale: My Lords, with great respect it is normal for the Minister to answer the first speeches from the Opposition Front Benches before other noble Lords—
Baroness Phillips: Forgive me, my Lords, but I have been in the House quite a while and I do not think that that is correct when we are debating a Motion.
Lord Skelmersdale: My Lords, I apologise to the noble Baroness; she is absolutely correct. I was getting confused with the Statements which we dealt with earlier.
Baroness Phillips: Thank you, my Lords. Having established that right, I will go on to the next one. I wanted to ask the Minister a question with reference to the chaperon. We went all through this dreary business a long time ago and I thought we had cleared it, but apparently we have not done so and we are now going to rescind various things that were dealt with in great depth a long time ago. I cannot really think that the people whom the Government consulted were very different from the women that we talked to all that time ago.
What is the nature of the chaperon? Is it another nurse? Is it another midwife? Is it a sister? Is it her husband? We are not merely talking about midwives in hospitals. Midwives go out into the rural areas. As I recall, the chaperon was one of the greatest stumbling blocks when we debated this previously. If the Government are going to spend double the money in order to have a minder, in order to have two people present, it is not quite in keeping with their policies in relation to some other aspects of the National Health Service. I should like to know the nature of the status of the chaperon.
Lord Somers: My Lords, before the noble Lord replies, I should just like to raise one point. The noble Lord says that there has been general agreement that this would be a desirable change. I wonder whether
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that general agreement has been that of women, because they are the people who are chiefly concerned.
Lord Glenarthur: My Lords, I am grateful for the comments of the noble Baroness, Lady Jeger, and the noble Baroness, Lady Phillips. As regards the choice in reality, which was referred to by the noble Baroness, Lady Jeger, I can confirm that will be a choice in reality. I have every confidence that health authorities will act responsibly about this very important matter of choice.
The guidance being prepared by health departments will instruct health authorities to ensure that women are able to choose to be attended by a female midwife if they so wish. The fact remains that there are not very many people involved with it at the moment. Of the 28 who qualified at the two midwifery centres to which I referred in my opening remarks, only two male midwives are practising in the country at present. Therefore I do not think that the situation is quite as serious as the noble Baroness made out.
The noble Baroness, Lady Phillips, was concerned about chaperonage. I do not really see that the cost problem which she mentioned really is a problem. I do not see chaperonage costing very much at all. There are often many student nurses or other midwives in attendance in hospital wards and delivery rooms and I envisage that the number of occasions when a member of staff has to be assigned specifically to chaperon will be the exception rather than the rule. The costs should, therefore, be minimal and no special provision is being made for them. I hope that that answers the point that was raised.
The noble Lord, Lord Somers, raised a point which I did not quite catch. If he could repeat it I will do my best to answer it.
Lord Somers: My Lords, I merely asked whether the general agreement which the noble Lord mentioned on the desirability of this change, was chiefly that of women, not of men.
Lord Glenarthur: My Lords, as I understand it, the survey was conducted at the hospitals where male midwives have been practising, and husbands were consulted and found this agreeable.
On Question, Motion agreed to.

Social Security Benefits Up-Rating Order 1983 Housing Benefits (Increase of Needs Allowances) Regulations 1983 Family Income Supplements (Computation) Regulations 1983 Child Benefit (Up-Rating) Regulations 1983 Supplementary Benefit Up-Rating Regulations 1983
6 p.m.
Lord Glenarthur: My Lords, I beg to move that the Social Security Benefits Up-rating Order 1983 be approved. The order is accompanied by a report by the

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Government Actuary (Cmnd. 8969), and there is a separate statement, HC32, which covers the up-rating of mobility allowance. It will, I hope, be for the convenience of your Lordships if, at the same time, I speak to the other Motions—a total of seven Motions—standing in my name on the Order Paper. I shall then move the first five Motions en bloc, if that is agreed to, and the Pensioners' Lump Sum Payments Order and the Supplementary Benefit (Requirements, Resources and Single Payments) Amendment Regulations individually. I hope that that is acceptable.
The Social Security Benefits Up-rating Order is the principal means by which national insurance, industrial injuries and certain other social security benefits will be increased from November this year. Your Lordships will recall that earlier this year this House approved the Social Security and Housing Benefits Act 1983, which changed the basis of up-rating these benefits from the "forecast" method to the "historic" method. The provisions of that Act were fully debated, and I shall not take up your Lordships' time either by repeating the reasons for the change or by detailing the increases which will be effected by the order.
It will, I hope, be sufficient for me to say that the increases proposed in the order, and the basis on which they are calculated were fully explained in the Statement made on 23rd June in another place by my right honourable friend the Secretary of State for Social Services and repeated by me to your Lordships that same day. Apart from the increases in weekly benefits for which it provides, it also increases the retirement pension earnings limit from £57 to £65 a week.
The second instrument before us is the Supplementary Benefit (Up-rating) Regulations, which are solely concerned with increases in supplementary benefit.
It is, perhaps, worth mentioning that whereas the increases in other social security benefits reflect, generally, the current inflation rate of 3·7 per cent., the increases in the main supplementary benefit scale rates reflect the movement of the RPI, excluding housing costs. This leads to an increase of 4·3 per cent. in the weekly scale rates, in addition to which housing costs are met usually in full. The supplementary benefit heating additions for those with a need for extra heating are being increased in line with the rise in fuel prices in the past year and go up by 8·6 per cent.
The regulations also provide new levels of single payments for clothing, footwear and bedding, and increase the amount of capital which a person may hold without affecting his entitlement to weekly benefit or to single payments under the supplementary benefit scheme.
The Family Income Supplement (Computation) Regulations increase the prescribed amounts which form the basis of calculating the amount of family income supplement payable to a working family bringing up children on low income. The regulations also increase the maximum payments under the scheme. The increases are in line with the 3·7 per cent. movement of the RPI in the past year.
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The Child Benefit (Uprating) Regulations will increase the amount of child benefit and one parent benefit by 11 per cent., bringing each of these to its highest ever level in real terms.
The last of the instruments which are concerned with increases in benefits is the Housing Benefits (Increase of Needs Allowances) Regulations. These regulations increase the needs allowances by about 4 per cent.
The sixth instrument, the Pensioners' Lump Sum Payments Order, differs from those which I have so far mentioned in that it does not provide for an increase in benefit but is the means by which the payment of the Christmas bonus to people receiving retirement pensions and other specified benefits is authorised.
The orders and regulations to which I have referred so far form a package of draft statutory instruments which traditionally your Lordships' House considers collectively at about this time each year. However, this year there are before your Lordships the draft Supplementary Benefit (Requirements, Resources and Single Payments) Regulations which do not form part of that package and which perhaps call for rather more detailed comment. These have been considered by the Social Security Advisory Committee, and their reports are to be found in Cmnd. Paper 8978. A number of changes were made to the draft regulations in the light of representations made to the committee and as a result of the committee's own observations. The Government are grateful to the committee for the consideration they have given to these proposals.
The regulations contain a wide range of changes to the supplementary benefit scheme, the majority of which are minor or technical. The two particular changes which have attracted some publicity concern the rules whereby a deduction is made from a claimant's benefit if he is voluntarily unemployed; and the rules for meeting board and lodging charges. However, before I deal in some detail with these I should first like to mention briefly some of the other important changes.
The change which will help the largest number of people concerns the removal of the so-called "invalidity trap". At present most people who receive invalidity benefit and other long-term incapacity benefits are paid at a rate which makes them unable to qualify for supplementary benefit because their benefit income is higher than the ordinary rate of supplementary benefit and they are therefore unable to progress to the higher long-term rate. They are thus trapped between the two rates. We are amending the regulations so that periods in receipt of long-term incapacity benefits will count towards the qualifying period for the long-term rate of supplementary benefit, so as to benefit 30,00 sick and disabled people at a cost of about £9 million a year.
Another change concerns the rule for linking separate periods on supplementary benefit for the purposes of the 52-week qualifying period for the long-term rate. At present gaps of 13 weeks or less between periods on benefit count towards the qualifying period. We are reducing the linking period from 13 weeks or less to 8 weeks or less to bring it into line with the linking rules for most other social security benefits.

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We are making a significant improvement in the rate of benefit payable to single people without accommodation. At present they receive £2.95 a day to cover all their expenses. This is less than a hostel dweller receives to cover the cost of meals alone. We are therefore increasing the amount of benefit payable to single homeless people to the equivalent of the rate for meals allowances—that is to say, £3.90 a day from November. The regulations introduce an easement in the assessment of capital resources. The first £1,500 of the surrender value of life insurance will be disregarded. We are increasing from £225 to £325 the limit on the cost of repairs and redecoration which can be met by a single payment of supplementary benefit.
I turn now to the changes in the rules for meeting board and lodging charges. When boarders claim supplementary benefit a fixed amount is allowed for personal expenses, but the main element in the assessment is the charge made for accommodation. If this is within the amount that the benefit officer considers to be reasonable for the area—what is known as the "local limit"—it is included in full. If it covers only part board, fixed amounts are added for the other meals. If the charge exceeds the local limit the benefit officer has to consider whether it is reasonable for the claimant to move to other accommodation, taking account of the availability of accommodation and the level of charges in the area and the personal circumstances of the claimant. This latter provision in particular has given rise to difficulties and caused us to bring forward the changes before your Lordships this afternoon. The provision for a single local limit is unsatisfactory, covering as it does a wide range of accommodation from bed and breakfast establishments for fit persons to nursing homes; and the current discretionary power places a heavy burden on supplementary benefit officers in deciding whether or not a person should move.
We propose, therefore, a three-tier system of limits based on reasonable weekly charges in the area for respectively nursing homes, residential care homes, and ordinary board and lodging accommodation, plus a single extension of £15.35 a week. We believe that this represents a considerable improvement in our provisions for boarders. However, we share the view of the Social Security Advisory Committee that the system will work as we intend only if the limits are properly set. We are working closely with the Chief Supplementary Benefit Officer to this end. We are also making arrangements to monitor what effect the new limits have on claimants and the accommodation provided for them. The local limits under each heading will be set by reference to the level of charges made for that type of accommodation in that area. Charges quite out of keeping with the local level for comparable accommodation will not be met. We are also setting up a survey to identify claimants whose charges are no longer met under the new provisions.
Finally, I come to the changes in voluntary unemployment deductions. Where a person is disqualified from unemployment benefit because he leaves, or refuses the offer of, a job without good cause, a deduction of 40 per cent, of the appropriate single person's scale rate is made from his supplementary benefit for up to six weeks. The regulations define certain types of case where a lower rate of deduction
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(20 per cent.) is to be applied to avoid potential hardship. The criteria in the regulations for the lower rate deduction follow closely the guidelines laid down by the Supplementary Benefits Commission prior to November 1980, but at that time staff were required to modify the deduction only if, in their opinion, the full rate would cause hardship. The effect of putting the criteria into regulations was that the deduction had to be modified automatically when they applied. But this was not intended to change the way the criteria were being applied in practice. However, before the new regulations came into effect in November 1980 fewer than 2 per cent, of deductions were at the lower rate. By November 1981 this had risen to 34 per cent. Clearly, the intended policy was not being achieved.
The Social Security Policy Inspectorate were therefore asked to look into the way the new regulations were working. Their report, which we have published, found that there was no justification on hardship grounds for the lower rate of deduction in the majority of cases where it was being applied, though there was in a minority; for example, where there was serious illness in the family. The Government therefore propose to limit the circumstances where the lower rate of deduction applies only to those cases where there is pregnancy or serious illness in the family. Proposals to this effect were put to the Social Security Advisory Committee, who advised against proceeding with them in their present form. The committee were not persuaded by the evidence from the inspectorate inquiry, and considered that the definition of hardship used by the inspectorate—
"a risk of the claimant or his family going without food or essential services"—
was too severe.
The Government respect and share the concern of the committee that unemployed people and their families should not suffer serious hardship. We have therefore carefully reconsidered the proposed amendment in the light of the committee's report. However, we remain convinced, for the reasons which caused us to bring forward the change, that such a change is justified. The deduction is intended to have a penal effect on those people who give up their jobs without good cause, and the definition of hardship used by the inspectorate, though more stringent than would apply normally for supplementary benefit purposes, is in our view appropriate in the context of voluntary unemployment.
It must be borne in mind, too, that the deduction applies only to the personal scale rate of the claimant: benefit for a wife and children is not affected, nor are payments to meet housing costs or additional requirements. The effect of applying the higher rate deduction instead of the lower is to reduce benefit by, at most, a further £5·15 a week at the current rates for an average of about four weeks and a maximum of six weeks. The lower rate of deduction was intended to apply to the small proportion of cases where there was a real risk of hardship. In practice, it is being applied where there is none.
The inspectorate inquiry also identified some defects in the administration of the present rules which result in some claimants not receiving refunds of voluntary unemployment deductions where a decision is subsequently made that they were not after all to be

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regarded as voluntarily unemployed. This is quite unacceptable to the Government, and we have taken urgent action to correct and improve their effectiveness. As regards past cases where the department may have failed to refund deductions, we are taking steps to identify these and to refund any benefit due.
All current claims will be examined in the course of the up-rating exercise, which is just starting and will be completed by November, and any benefit which it is established has been wrongfully withheld on grounds of voluntary unemployment will be paid in full. Subject to the availability of the relevant records, anybody else who believes that benefit has been wrongfully withheld on these grounds in respect of a previous claim may apply to have his case reviewed. Publicity will be arranged and leaflets prepared inviting such applications. Instructions have been issued to social security local offices and to unemployment benefit offices requiring procedures to be strictly applied for the future.
My Lords, each passing day makes clearer to me that very little, if anything, is simple in the field of social security, but I have tried to explain the main purposes of the instruments now before your Lordships not as briefly, I am afraid, as I should have liked on what I suppose is the last day of term; but I have tried to do it as simply as possible in view of the more detailed explanatory material which has previously been made available for those who require it. I therefore commend the proposals for your Lordships' approval. I beg to move.
Moved, That the draft order laid before the House on 5th July be approved.
That the draft regulations laid before the House on 7th July be approved.
That the draft regulations laid before the House on 7th July be approved.
That the draft regulations laid before the House on 7th July be approved.
That the draft regulations laid before the House on 7th July be approved.—(Lord Glenarthur.)
6.15 p.m.
Baroness Jeger: My Lords, I appreciate that the noble Minister has had a difficult job today in presenting to us, on the last day of term, such a complicated number of proposals. I must say, in no criticism of him but of those who manage Government business, that I much regret that these detailed matters have been put before us at such a time and in such a comparatively difficult situation, when they affect thousands and thousands of the poorest people in our country. It is a great pity that the Government business managers did not feel that these matters should have been organised in a different way so that we might have had a fuller debate and not have to rush these through at this time.
Of course, the proposals before your Lordships arise out of previous legislation. Like the noble Minister, I do not propose to go over the arguments that we had, particularly during the passage of the Social Security and Housing Benefits Bill, but I must ask the noble Lord one or two questions. As he says, there is a
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package before us, but there are one or two matters which come outside the package.
I am not sure whether the noble Minister is aware of the anxiety of the Association of Metropolitan Authorities about some of these points, particularly regarding the last matter before us, the Supplementary Benefit (Requirements, Resources and Single Payments) Amendment Regulations, and so on. There seems to be some difficulty, and the noble Minister was quite fair in explaining that the Government have not always agreed with their own Social Security Advisory Committee on some of these points. I am particularly concerned with the introduction of the three-tier system instead of allowing the local supplementary benefits officers to have some discretion in amounts that are being awarded for board and lodgings.
One complication which I hope the noble Lord may be able to explain—and I hope he will not think I am going into too much detail—concerns some anxiety about the question of people in hostels where they have special needs. I think of people who might be on treatment for alcoholism or for drug abuse, and where obviously it is going to be much more expensive to maintain them. I hope that the rates will not be so rigid that they will not take into account these special concerns.
I want to ask the Minister whether he has been fully sympathetic to the question of what we call adult fostering, and the payments to be made in this connection. We hear a lot of talk from the Government—and this side of the House supports it fully—about the idea of getting more mentally handicapped and physically handicapped people out of big hospitals and into the community and into small hostels. People who are to be helped to get out of the big hospitals, I submit, are expensive people.
It is wrong to think that by cutting the cost to the National Health Service of maintaining large hospitals we are going to save money in the long run. The greater part of the expenditure saved by this welcome policy will have to be transferred to social services and to supplementary benefits.
I am concerned that where cuts are made in the payments for hostel accommodation more and more of those people will look increasingly to the social services departments of local authorities. This is at a time when the Government are trying to tell every local authority that it is not to spend so much money. I know from friends in local government that there is anxiety about these matters. I hope that nothing the Minister has said tonight is intended to suggest that being more strict about hostel and adult fostering charges will have the effect of increasing liabilities for the social services departments of local councils.
We welcome the removal of the invalidity trap and the slight improvement in the single homeless daily allowance, but today is not the occasion to go into detail. We are looking forward very much to some real policy decisions from the Government about dealing with the single homeless. If they think they are dealing with the single homeless by giving them £3·90 per day to go away and keep quiet that is not the answer to a terrible social problem. I am not aware of any signs that that problem is being tackled at its roots.

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I said that I would not go into a great deal of detail. My last point is on the question of voluntary unemployment. I am sure we all recognise the difficulties, but I hope that the Government are clear what they mean about voluntary unemployment. Is it that the chap just cannot stand his boss any more and sacks himself because he finds everything getting on his nerves? Is it someone who is wilfully lazy? Perhaps the Minister would remind the House what the appeal procedures are for someone who suffers this reduction in benefit, because he is deemed voluntarily to have created his own unemployment, when, in fact, he has some very good reason for walking out and slamming the door on a job which he may find he is not well enough to do or which is not suited to him.
The Minister suggested that the new rules would not cause hardship. On the other hand, he said—I wrote it down—that these changes were meant to have a penal effect on the man concerned, or I suppose it might be a woman. He emphasised that the wife and children would continue to receive full rates of benefit. But the effect of reducing unemployment benefit to the head of the household means that the family income is inevitably smaller and this is likely to rebound on the standard of living of the whole family. Therefore, I hope this will be used with the greatest care and sensitivity because it is no use trying to get a definition of "hardship" which excludes the fact that a reduction in income must increase the possibility of hardship, even if the wife and children maintain their own benefits.
These are the main points that are causing us concern. I will not go beyond the terms of reference before the House to raise more fundamental questions of the Government's whole attitude to the problem of social security. I shall leave out the philosophy and any more mathematics and hope that the Government will see that these orders are carried out with the fullest understanding, sympathy and compassion for those who have to seek help in this way.
6.24 p.m.
Lord Banks: My Lords, I should like to thank the noble Lord, Lord Glenarthur, for his clear exposition of the content of these orders. As I understand it, we are speaking now to seven different items. That is quite a lot and I will endeavour to do so briefly, but it is a lot to cover in a short time.
Dealing first with the up-rating orders, we are always in difficulty over these because the increases are usually announced at the time of the Budget and the news has become a little stale by the end of July, usually on the last day, when we get these orders embodying the changes. However, as has been pointed out, this year it has been slightly different because of the return to the historic as opposed to the forecast method of determining inflation. That means that most of the figures could not be given in March and we had to wait until comparatively recently to learn what the inflation rate was for the 12 months to May. However, we had the discussion on the legislation governing the change and a few weeks ago we learned that the figure for the increases was 3.7 per cent.
On the change to the historic method, the Government's expectation of inflation in November, as announced by the Chancellor of the Exchequer in
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his Budget speech, was 6 per cent. The increase is to be 3.7 per cent., so that on those figures the beneficiary is losing as a result of the change.
Government spokesmen have repeatedly said that if the inflation rate to November exceeded 3·7 per cent. and consequently there is a loss, it will automatically be made up in the following year. But that is not so and on 9th May in this House I set out my reasons for saying that. I argued that the November 1984 up-rating would not necessarily make good any loss occasioned by a change in method in November 1983. Whether it did so would depend on the difference between the rise in prices in the period May to November 1982 and the period May to November 1984.
Immediately before the general election the noble Lord, Lord Trefgarne, wrote to me in these terms:
"I write to confirm that, as you said, the difference between the two review periods will depend on the difference between the rise in prices in the period May to November 1982, which we know to be 1·3 per cent., and the corresponding movement between May and November 1984".
That last increase is certainly likely to be more than 1·3 per cent., which means that the loss will not be made good in the second year. However, let me make it clear, as I have before, that I think it is right in principle to go back to the historic method, but I think the change was made at the wrong time because it is bound to be adverse from the beneficiary's point of view; which is exactly the same thing as the Labour Government did when they moved in the opposite direction, also at a time when the move was not advantageous to the beneficiary.
Moving to more general remarks, Ministers often say of the annual up-rating, "We are increasing benefits by such and such—an enormous sum". The implication is, "How can you accuse us of cutting back when we are going to spend all that amount extra?" In the main, they are merely repairing the ravages of inflation. This year the increase of benefits in a full year from the National Insurance Fund will cost £772 million. Two years ago—we are thinking of the National Insurance Fund which is only a part of the up-ratings we are considering today—the corresponding figure was £1,446 million; almost twice as much. Were the Government twice as generous two years ago? Of course not. Inflation was higher at that time and the argument about whether the fall in inflation has been obtained at too high a cost lies outside the scope of this debate.
My point is that it is clearly no use trying to judge the merit of up-rating by the total figures involved. What is important is whether the real value of benefit has been maintained, whether the level of benefit is higher or lower as a consequence of Government policy. There are some increases which I, like the noble Baroness, would welcome. I welcome the increase of 65p in child benefit, but for that increase to match the increase in personal taxation allowances an 80p increase would have been necessary and not a 65p increase. We always have to remember the relationship between personal income tax allowances and child benefit; because child benefit has replaced income tax allowances for children. We on these Benches have argued frequently for increases in child benefit. We believe that that is very important and,

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while welcoming the present increase, we shall continue to urge a higher increase yet; because we believe that families with children have fallen behind.
I welcome the rise of 8·6 per cent. in the supplementary benefit heating additions. This has been done because of the rise in fuel prices of some 60 per cent. in three years. Whether it is adequate to meet that, I do not know, but at least it is a step in that direction. But it reminds me again of the need to have a pensioners' index which really reflects what pensioners spend and to which the pension could be related. The restoration of the 5 per cent. rebate on unemployment benefit is welcome, of course, but it does not excuse its introduction in the first place. Like the noble Baroness, I welcome the end of the invalidity trap; but, against that, I should have to set the fact that pensions, because of the break with earnings, are lower as a result of Government policy than they otherwise would have been.
The inadequacy of the pension for today's pensioners, to which I referred during the debate on the Address, has not been tackled. The 5 per cent. rebate is not yet restored for invalidity pensions and I should very much like to know when that will be achieved. Invalids' chair allowance is still not extended to married women; and the household duties test for the housewife's non-contributory invalidity pension has not yet been abolished. The real value of the pensioner's Christmas bonus is being allowed to wither away.
I must say, as I have said before in this House, that I think that if benefits are provided by Parliament for people in particular categories, they should be maintained at a constant value unless Parliament deliberately and positively decide to the contrary. The earnings rule, although the limit is raised, still remains, although the Conservatives were so keen to remove it in early 1979 when in Opposition that they divided this House on the issue. The long-term rate of supplementary benefit is still not available to unemployed men under 60. It is appeciated that, whatever progress has been made with certain benefits—and I agree that with certain benefits, mobility allowance, for example, progress has been made—the level of many benefits remains inadequate and some benefits are lower than they would otherwise have been but for Government policies.
The rumours of a possible further cut in the social security field become increasingly alarming. I hope that the noble Lord will be able to dispel these rumours when he comes to reply and to say specifically and categorially that there is no intention, the 5 per cent. rebate having been restored, to cut unemployment benefit again, as has been suggested in the Press.
My Lords, before I close, I should like to say a word about the Supplementary Benefit (Requirements, Resources and Single Payment) Amendment Regulations, 1983. There are two comments there. One is on the amendment to Regulation 8.3 and one on amendment to Regulation 9. The amendment to Regulation 8.3, as the noble Lord explained, deals with supplementary benefit payable to a claimant who, through his own fault, is no longer in employment. While in certain conditions he can nevertheless
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be entitled to full benefit although he has voluntarily left his job, normally there is a reduction of 40 per cent., but in cases of hardship there is a reduction of only 20 per cent. But, as the noble Lord explained, the number of cases when that lesser deduction will apply in order to prevent hardship, is being restricted to one only—where there is a member of the family pregnant or seriously ill. For example, to have a child under 5 in the family will no longer be a reason for a lower deduction under the order. I believe that this may cause hardship, in spite of what the noble Lord has said.
The cut in the claimant's entitlement affects the amount of financial support available to children, and the supplementary scale rate for children is already inadequate. The noble Lord referred to the inspectorate survey of August and November 1982, and said that, according to the inspectorate, there had been no hardship. But the definitions which he himself gave to the inspectorate to use were very severe; and the inspectorate seemed to assume that all housing costs would be met by housing benefit, although that is not necessarily so. I still have grave doubts as to the humanity or necessity of this proposal.
Finally, on the amendment to Regulation 9, I am concerned about the proposal to abolish the ultimate discretion to meet a person's board and lodging charge in full where it is above the DHSS limit but it is unreasonable to expect the person to move. I understand that it is the view of the Department of Health and Social Security that this has been abused by certain organisations concerned with the rehabilitation of alcoholics and drug addicts. But is the only way of dealing with such abuse to penalise the innocent as well as the guilty; and to discriminate against boarders as opposed to tenants and owner-occupiers? The Government obviously do not want to give an unscrupulous landlord a blank cheque, but the limit must be reasonable. I wonder whether the ultimate solution is perhaps to have all boarding establishments licensed by the local authority, with premises regularly inspected, to ensure that health and safety standards are maintained and fixed maximum charges set. I should be interested to hear the views of the noble Lord on the points that I have raised.
Lord Kilmarnock: My Lords, I should like to thank the noble Lord for having steered us so expertly through the reefs of these regulations. There are some things here that we can welcome. The increase in child benefit is one of them. However, I still have severe doubts about the adequacy of the 3.7 per cent. up-rating for pensioners. Lord Banks referred to the need of a pensioners' index. I am sure that that is the case, particularly in view of Paragraph 13 of the report for the last Session of the Social Services Committee of another place, in which they say that there are good grounds for believing that the welcome fall in the rate of inflation over the past 12 months has not been fully reflected in the expenditure patterns of pensioners and other groups of social security beneficiaries. I hope very much that the Government will keep a close eye on that.
I also wonder whether the retention of the £65 earnings limit for pensioners was really necessary. Having gone up to £65, it seems to me that it would

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have been sensible to have removed it altogether. And then, as Lord Banks has said, we still have the bonus for pensioners at only £10 and the death grant still at £30. We pledged ourselves in our general election manifesto to the abolition for pensioners of standing charges for gas, electricity and telephone. This would have been of great benefit to that group.
I want to turn briefly to the Family Income Supplements (Computation) Regulations 1983.I wish to take the opportunity here of thanking the noble Lord for his letter to me of 8th July, in response to my question on 23rd June on family income supplement take-up.
I note from his letter that there are 200,000 families now claiming the supplement as against 73,500 in 1979, and he attributes this largely to an increase in take-up. But one has to point out that there has also been a serious increase in poverty and we now have a total of 7 million people who are dependent on supplementary benefits, which the noble Lord will recall was seen by Beveridge as the last refuge of the destitute.
The noble Lord in his letter goes on in relation to family income supplement—and I quote:
"In the absence of detailed statistical analysis we cannot put a precise figure on the improvement that has taken place".
I want to ask the noble Lord whether his department will try to improve the statistical analysis of this particular benefit so that we may know what is happening to it.
On the Supplementary Benefit Up-rating Regulations, I came across a rather curious little fact; perhaps it was even a slip. In the schedules under "men's clothing and footwear", on pages 8 and 9, I found that the standard amount for men's vests, woollen, had soared from £6.20 to £8.50, while women's vests, woollen, remained pegged at £4.70. As they are both made of wool, presumably with the same price movement in the material, surely what is sauce for the goose is sauce for the gander. I wonder whether the Government are not in danger possibly of running into accusations of sex discrimination. Would they please look into it?
I share the concern expressed by the noble Baroness, Lady Jeger, on the Supplementary Benefit Requirements, Resources and Single Payments Regulations, particularly in relation to the passage which the noble Lord read out. This seems to be the only case in which the Government have gone directly against the recommendation of the Social Security Advisory Committee in relation to the deduction for so-called voluntary unemployment. In fact, the noble Lord read out this very clear passage to the effect that the deduction applies only in cases of voluntary unemployment and is intended to have a penal effect.
Obviously one is thinking here mainly of the interests of children in families who are so affected. I also wonder whether the old discretionary system was perhaps not better than the rigid rules which have now been introduced. However, I should like to associate myself with the remarks of the noble Baroness, Lady Jeger, in hoping that the Government will attempt to apply these new rules with humanity and with proper attention to the merits of individual cases.
Finally, as this is the last chance we have of jogging the Government's arm about anything before October, and in order to give them a little homework
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for the holidays—I have also informed the noble Lord's office of this point—I wanted to raise the question of the extension of the long-term supplementary benefit rate to unemployed families with children. I think the noble Lord, Lord Banks, also touched on that. That was a top priority recommendation of the Social Services Committee of another place in their report for the Session 1982–83, in paragraph 28. I quote:
"The Social Security Advisory Committee, both in their first annual report and in their letter to the Secretary of State, put the extension of the long-term rate of supplementary benefit to unemployed people with children at the top of their list. This would also be our priority".
So it is not only the priority of the Social Services Advisory Committee, but also of the Social Services Committee of another place. They go on to say:
"We recommend that the extension of the long-term supplementary benefit rate to unemployed families with children should be the first priority use of the funds available".
I want to leave that thought in the Government's mind and ask if they will give very serious consideration to that recommendation of both the Social Security Advisory Committee and the Social Services Committee of another place before we return from the Recess.
6.45 p.m.
Lord Glenarthur: My Lords, I am grateful for the comments which your Lordships have made on the various orders I have described. There are a number of points to answer and I will do my best to answer them, although not necessarily in the order that they came to me. I hope I shall be able to answer as many points as possible. The noble Baroness, Lady Jeger, asked about the three tiers for board and lodging and about the rates payable to those in hostels for alcohol and drug misusers. In fact, charges made in such hostels cover both board and rehabilitation costs. The latter element is a matter for local authorities, although residents in such hostels will qualify for the extension of £15·35 a week which is available to certain categories of patients. I hope that information meets that particular point. I am advised that the question of adult hospitals is outside the scope of the regulations I have described. If I am advised incorrectly I will write to the noble Baroness, but I understand that the regulations do not cover the particular point which she mentioned.
Baroness Jeger: My Lords, did the noble Lord mishear me? I was talking about hostels and not hospitals.
Lord Glenarthur: My Lords, if I have got it wrong then of course I apologise, and I will write to the noble Baroness. But, as I understood the point she made, this is not in fact covered by the regulations. The noble Baroness asked about hardship and the question of voluntary unemployment. There were really three areas that were touched on in connection with voluntary unemployment. When someone has family responsibilities, the deduction is considerably less than 40 per cent. of total benefit income. The deduction is applied only to the claimant's scale rate, leaving the amounts paid for wife or children intact; and housing benefit is also unaffected by the deduction.
Also on the question of voluntary unemployment, the noble Baroness asked: why abolish the concession

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for those with children under five? Since these families were included in the pre-1980 Act guidelines their benefit provision improved considerably. Children under five now have the same considerably higher scale rate as 5 to 10-year olds, and families with children under five receive a special heating addition. Also, because the deduction is 40 per cent. of the single person's rate, the benefit for wife and children is unaffected. This means that the standard deduction for a married man with children is actually 20 to 25 per cent. of his benefit income. The question of appeal rights was also mentioned. There is a right of appeal to the National Insurance Tribunal, which has much experience in such cases, against the insurance officer's decision that a claimant is voluntarily unemployed. I hope that covers most of the points raised by the noble Baroness, but if there are others I will pick them up and write to her.
The noble Lord, Lord Banks, made certain points about the change back from the "forecast" to the "historic" method of up-rating. The noble Lord said that the difference between the two review periods will depend on the difference between the rise in prices in the period May to November 1982 (which we know to be 1.3 per cent.) and the corresponding movement between May and November 1984. What is less clear is what adjustments might have been necessary under the old "forecast" method and whether such adjustments would in any way have affected the comparison. Under the "historic" method, no such deductions would fall to be made, although I take the point that under either method it is possible that the November up-rating might reflect more or less than the actual movement of prices between up-rating dates. Whatever his view about the change, the fact remains that the Government have more than fully honoured our pledge to maintain the level of pensions and related benefits.
If I may give the noble Lord some figures—even if he assumes that there is an inflation rate of 6 per cent. in November next year; it may be even less than that—since November, 1978, prices have gone up by 70.7 per cent. and pensions have gone up by 74.6 per cent. I think that that demonstrates that the pledge to pensioners has been more than maintained.
The noble Lord asked about the Christmas bonus. It was an indication of our concern for pensioners that we legislated early to make the Christmas bonus a permanent feature of the social security scheme, but an increase in the amount of the bonus from £10 cannot be justified at present. The bonus is paid to nearly 10½ million people at a cost of £104 million. The noble Lord will be aware that there are constraints, and this I am afraid is to some extent the result of those constraints. Much as we should like to put it up, I am afraid that there is not the money to do so.
The noble Lord also asked about restoring the 5 per cent. abatement of invalidity benefit. We have undertaken that the abatement of the invalidity benefit will be made good when the invalidity benefit is brought into tax, but a date for taxation has not yet been fixed so I cannot go any further on that point. The noble Lord asked whether it is the Government's intention to cut unemployment benefit again. The
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rates of all benefits payable from November 1983, have already been determined and set out in the uprating instruments which we have discussed today. I really cannot anticipate what the rates might be in future years.
On the question of board and lodging, the meat of the question that he asked me was: is not the solution to the regulation of board and lodging charges to licence all boarding establishments with local authorities, who would be responsible for fixing maximum charges and for inspection to ensure that health and safety standards were met? We think that that is too draconian. Market forces will properly control charges and standards of ordinary board and lodging. There is already legislation in respect of health and safety standards.
The noble Lord, Lord Kilmarnock, asked me a variety of questions and I am grateful to him for giving me notice that he was going to ask at least some of them. As for woollen garments, I am afraid that I do not have an answer for the noble Lord. In the heat of the summer, those are the last things to cross my mind. But I will inquire and if there has been a mistake I shall have it corrected. He raised a point about the long-term rate of supplementary benefit to families with children, when the head of the family is unemployed. He said that he would provide that as a little background work for us in the holidays. This is something that we shall look into; but I must tell him that the Government are aware of the arguments for extending the long-term rate to the unemployed more generally. But there are problems of cost and broader economic issues, of which he will be aware, such as possible repercussions on work incentives, and because of these problems no commitment can be given at present. As I understand it, what he suggests should cost up to £190 million a year extra.
The noble Lord talked about the letter that I wrote to him on 8th July about family income supplement take-up. I do not think that I can usefully add to the letter that I sent to him on that date. We cannot put a precise figure on take-up, but it is increasing greatly and people are now far more aware of family income supplement. I am afraid that I do not have any more information to give him on that point, but I hope that I have been able to cover the main points that he raised—and, very probably, there will be others.
The noble Lord mentioned the pensioners' price index and perhaps I might refer to that before I finish. Pensions have risen significantly faster than the pensioner price indices since November 1978. For example, in the four-year period to the last up-rating, retirement pensions rose by 68·5 per cent. compared to a rise of 61 per cent. in the RPI and only 57·4 per cent. in the two-person pensioner price index and 58·1 per cent. in the one-person pensioner price index. Over the same period, supplementary pension scale rates, before the addition of housing costs, went up by 65·3 per cent. Over the last year, the PPI has risen by 3·7 per cent. for a two-person household and 3·8 per cent. for a one-person household, compared to the RPI movement of 3·7 per cent. Having I hope not baffled the noble Lord with figures, I trust that that has covered most of the points and that I may take up any other points that I have not been able to cover this afternoon. If your Lordships are content, I shall now

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beg to move the first five Motions standing in my name en bloc.
On Question, Motions agreed to.

Pensioners' Lump Sum Payments Order 1983
Lord Glenarthur: My Lords, I beg to move.
Moved, That the draft order laid before the House on 7th July be approved.—(Lord Glenarthur.)
On Question, Motion agreed to.

Supplementary Benefit (Requirements, Resources and Single Payments) Amendment Regulations 1983
Lord Glenarthur: My Lords, I beg to move.
Moved, That the draft regulations laid before the house on 12th July be approved.—(Lord Glenarthur.)
On Question, Motion agreed to.

Electrically Assisted Pedal Cycles Regulations 1983
6.56 p.m.
Lord Lucas of Chilworth: My Lords, I beg to move the draft Electrically Assisted Pedal Cycles Regulations 1983. These regulations have been made and laid under powers contained in the road traffic Acts. Your Lordships will probably recall that Section 24 of the Transport Act 1981 makes provision for the removal of electrically assisted pedal cycles from the motor vehicle category under the road traffic Acts, and lays down a minimum riding age of 14 years. Riders will not require licences, insurance or safety helmets, and machines will be exempt from Motor Vehicles (Construction and use) Regulations and MOT vehicle testing arrangements. It is also intended that machines should be exempted from registration requirements, and separate amending regulations to effect this exemption will be laid after these regulations are approved. These regulations do no more than define the type of machine that will be able to take advantage of the concessions, and, if approved, they will come into effect almost immediately.
There has been a great deal of interest in, and support for, the proposals. Manufacturers have told us that there is a real market for such vehicles, and some have already received advance orders. The vehicle will be of particular help to the aged, handicapped and infirm, but will also benefit many people who simply want moderately priced, easy to use, inexpensive to operate and simple transport. The vehicles also provide something of a bonus from an environmental viewpoint, being essentially pollution-free.
Not unexpectedly, the manufacturers have been very keen for us to make the regulations quickly. It has, regretfully, taken rather longer than they would have liked, but there are quite good reasons for this. We had to be particularly sure that any of the vehicles that might be made and sold under these regulations will be safe to ride by both the experienced and inexperienced rider, particularly as Parliament set the minimum riding age limit at 14 years.
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I am satisfied that the specification laid down for these vehicles in these regulations, which we have gone into very thoroughly with the assistance of the Transport and Road Research Laboratory, will ensure that they can be used safely. Their performance will, in fact, be rather worse than that of an energetically ridden pedal cycle, because the small electric motor will cut out if the vehicle exceeds 15 miles per hour. Riders will have to pedal for most of the time to stop the vehicle's battery from discharging too quickly. There is much less scope for recharging the battery in motion than with either a motorcycle or motor car. But those riders who may find it difficult to pedal for long periods will be able to use this amount of power from the motor quite independently of pedalling. This will of course considerably reduce both the speed and range of the vehicle, which in itself is affected not only by the gradients the rider is travelling upon but also by the weight being carried by the machine.
Further safety requirements will be contained in the proposed Pedal Cycles (Construction and Use) Regulations. A number of noble Lords have spoken to me with regard to these regulations—in particular my noble friend Lord Ironside, who has a great interest in electric vehicles. They have welcomed these regulations. I hope that other noble Lords will also welcome these regulations. I commend the order to the House.
Moved. That the regulations laid before the House on 12th July be approved.—(Lord Lucas of Chilworth.)
On Question, Motion agreed to.

Adjournment
Lord Denham: My Lords, usually at this time of the year we have undergone a rather hard period for a week or two before we reach this stage in the Session, and it is normal for the Government Chief Whip of the day to express on behalf of his noble friends behind him good wishes to noble Lords in all parts of the House. We have had perhaps a rather lighter period during the past week or two. Even so, may I, on behalf of my noble friends, wish noble Lords in all parts of the House an extremely good and a restful Recess. May I also—I hope on behalf of the whole House—express, to all those who serve us in the Palace of Westminster and look after us so well, the wish that they, too, will have an extremely good and restful time. I beg to move that the House do now adjourn.
Moved, That the House do now adjourn.—(Lord Denham.)
Lord Ponsonby of Shulbrede: My Lords, before the noble Lord finally moves, That the House do now adjourn, may I associate those on these Benches with the remarks which he has made in wishing all those who serve us in this House a restful time during the long Recess. We closely associate ourselves with the noble Lord's remarks. As he has said, we have had a relatively easy time since we came back here on 22nd June. My only hope is that in planning the future business of your Lordships' House the Government will ensure that at this time next July we shall not have

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had an unacceptable period of heavy business. Looking at the Government's future programme, my fear is that we are going to have a very heavy July next year.
Lord Banks: My Lords, in supporting the Motion, may I say on behalf of my noble friends that we reciprocate the felicitations which have been extended to all parts of the House by the noble Lord the Chief Whip on the Government side and, indeed, by the noble Lord the Chief Whip for the Opposition. At the same time we join in supporting the good wishes which have been extended by them to all those who serve this House.
Lord Kilmarnock: My Lords, on behalf of my noble friends on this Bench, I also should like to associate myself with the remarks made by the noble Lord the Chief Whip, particularly in relation to the splendid service which we receive from the officers and the permanent staff of this House. Perhaps I may also add my own good wishes to the noble Lord and to all members of other parties for a happy and well earned Recess.
House adjourned for the Summer Recess at five minutes past seven o'clock until Monday, 24th October next.