HL Deb 16 March 1983 vol 440 cc797-821

8.19 p.m.

Lord Banks rose to ask Her Majesty's Government why they have imposed cuts and other constraints on the Foreign and Commonwealth Office Centre at Wiston House; and whether it is not the case that these measures will endanger the quality and effectiveness of the international Wilton Park conferences.

The noble Lord said: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. The House will know of the high reputation of the Wilton Park conferences. These conferences began as long ago as 1946 and were originally held at Wilton Park, Beaconsfield. They began purely as Anglo-German conferences but soon became much wider, drawing mainly from the 25 countries of the OECD. Since 1950 they have been based at Wiston House in Sussex.

The fees charged for attendance at these conferences are calculated to cover full board and lodging, attendance at all sessions and the cost of extramural visits. The balance of the administrative expenditure is met by the British Government as a unique contribution to international understanding. Since 1946 some 15,000 people have attended conferences there. Of course many members of this House have been there either as speakers or as participants, as indeed I have myself.

These conferences have gained a considerable international reputation, reflecting much credit on this country. The original director was Sir Heinz Koeppler, and in 1977 he was succeeded by the present director, Mr. T. W. Slack. There are 36 members of staff; 14 part-time. In reviewing this whole operation in 1975 Sir Heinz Koeppler said: "Wilton Park is run on a shoestring". I think in view of what has occurred it is worth repeating that his view was that Wilton Park is run on a shoestring. So much, my Lords, for the background.

I want to move now to the matters leading to the present impasse between the Foreign and Commonwealth Office and the 21-strong academic council. In December 1981 Foreign Office Ministers initiated a drastic review of Wiston House/Wilton Park activities. The target was to secure savings in the region of 25 per cent., or £115,000. The total net costs in 1981–82 were £465,000. The review was carried out by a senior Foreign and Commonwealth Office inspector, with two other members of the Foreign Office staff and with the assistance of outside catering/hotel consultants. The inspector greatly exceeded the target, a target of 25 per cent., and recommended savings of 44 per cent., or £203,000. This involved cutting the staff by eight out of 36, the elimination of the deputy director and one member of the academic staff (effectively eliminating participation recruitment), the downgrading of the director from Under-Secretary to Assistant Secretary, the shortening of all conferences to five days or less, the elimination of extramural visits and the abolition of the Wilton Park journal; and the Wiston House Centre was to be used for more outside conferences to raise revenue.

The director and the academic council under the acting chairmanship of Sir Peter Tennant have maintained from the outset that there was no consultation with the director about the workloads of the staff; not that there was no consultation, but that there was no consultation on this vitally important point of the workloads of the staff. They have also complained that the inspector, having sent the report to the director, declined to discuss it with them. It is the view of the academic council and the director that this led to an incorrect assessment of the workload of the academic staff, which previous reviews had indicated was very heavy. The academic council resisted the 44 per cent. savings proposed, claiming that the maximum possible savings without doing damage to the quality and effectiveness of the Wilton Park operation would be 25 per cent., with a reduction of four, and not eight, in the staff.

On 18th June 1982, Ministers finally decided on savings of 30 per cent. (£140,000), with a staff cut of five; the director to be downgraded; half the conferences to be shortened; half the extramural visits to be eliminated; and the Wilton Park journal to be abolished. The academic council continued to resist. They argued that conferences of less than a full working week did not capture the special Wilton Park flavour. They argued that half the conferences would no longer have the extramural visits which they considered to be essential for balance. The elimination of one of the five academic staff, they maintained, critically weakened the team responsible for planning, organising and running the conferences, recruiting speakers and participants and providing three-language interpretation.

They objected strongly to the downgrading of the director, who by general consent had carried out his duties with distinction. They felt, in fact, that the Foreign and Commonwealth Office was shamefully taking advantage of the expiry of the contract of the director, and they felt, too, that the downgrading of the director diminished the standing of the directorship and the prestige of the institution. They objected to what they saw as interference with the internal management: the shortening of conferences, the reducing of the extramural visits and the abolition of the journal. They felt that within an agreed financial budget the academic council and the director should be left to decide these matters.

In an Adjournment debate in another place on 15th November of last year, strong support was expressed for the views of the academic council by five Members of Parliament who spoke and who, as it happened, were all Government supporters. The Foreign Affairs Committee in another place, reporting on 17th January this year, while not opting either for the solution of the Foreign and Commonwealth Office or for that of the academic council, concluded its report with these words: We repeat our view that no steps should be taken which would jeopardise Wilton Park's future. We very much hope that agreement can be reached between the Foreign and Commonwealth Office and the Wilton Park authorities to secure the future of Wilton Park conferences and their valuable contribution to understanding and co-operation between OECD countries.". The academic council reluctantly conceded the remaining substantial difference with the Foreign and Commonwealth Office, except the downgrading of the director and certain small items, narrowing the difference to £5,000; but I think that it is important to make it clear that they did that very reluctantly. Sir Peter Tennant, in a letter to The Times in November 1982, had said that the difference at that time of 5 per cent. between the Foreign Office and the academic council, amounting to £23,000, could mean the difference between prosperity and decline. But the Foreign Office has refused to move even on the issue of the downgrading of the director. The consequence is that Sir Peter Tennant, the acting chairman, and 11 members of the academic council have resigned—that is, 12 out of 21. We shall hear in the course of our discussions from one of those, the noble Lord, Lord Beloff.

The director has declined to renew his contract under the terms being offered. Further, at a meeting held on 9th March, the remaining members of the academic council, except for two who were unable to be present, agreed that, by and large, they supported the views of their colleagues who had resigned and that they would not wish to be associated with the selection process for the appointment of a new director until the relationship between the Foreign and Commonwealth Office and Wiston Park, which in their view had been radically changed by recent events—it was their view that it had been radically changed by recent events—could be clarified.

There has been a further report since then, issued by the Select Committee in another place, and in an appendix to that report there is a letter from the Chairman of that Committee in which he says—this is a letter to the noble Lord, Lord Belstead: My Committee find it hard to believe that the need for economy in the Foreign and Commonwealth Office is so pressing as to necessitate the enforcement of such marginal expenditure cuts with such damaging consequences, or that the small financial savings secured by those cuts can justify the resulting and resentment, which could have been easily foreseen as the Academic Council's views became clear in the latter part of last year".

Commenting on what I have said so far, I would say the following. There is clearly an impasse, a serious rift, in the relations between the academic council and the Foreign and Commonwealth Office. Secondly, in my view the Foreign and Commonwealth Office are going too far in cuts which they are seeking, bearing in mind Sir Heinz Koeppler's view that Wilton Park is run on a shoestring. The Foreign and Commonwealth Office appear to be interfering unnecessarily in the management of Wilton Park. In the matter of the director, they seem to have behaved unbelievably badly and very stubbornly. I wonder whether the noble Lord, Lord Belstead, can name anyone else who has been downgraded during his incumbency of the post, because, after all, it is generally agreed that Mr. Slack performed his duties with great success.

We have spoken of savings of 30 per cent. sought by the Foreign and Commonwealth Office and 25 per cent. agreed initially by the academic council. But 7 per cent. has already been achieved by the merger of Wilton Park and the European Discussion Centre. Indeed, 8 per cent. is the savings to be secured by means of increased revenue. So the cuts about which much of the argument has taken place, amount to 15 per cent.; 10 per cent. having been agreed by the academic council. If the noble Lord, Lord Belstead, agrees that these are the correct figures then he will be emphasising the significance of the difference between the Foreign and Commonwelath Office and the academic council, because it is 5 per cent. out of 15 per cent. one third of what is proposed and not one sixth, as might have appeared. Yet even so it is only £23,000.

It has been argued that as far as the director's grade is concerned, his predecessor served in the lower grade until 1973. But he was then up-graded and the present director was appointed in the present grade, so it seems to me that it is quite irrelevant that his predecessor at some time held a lower grade. It has been argued that the Foreign and Commonwealth Office has sought ways of ensuring that their director does not lose income. It is by no means clear to me that the financial disadvantages have been satisfactorily overcome in this way, but, even if they have, it would not seem to justify the action which is objectionable on other grounds.

It has also been argued that the Government have shown a commitment to Wilton Park by renewing on a seven-year lease instead of a five-year lease and making some welcome capital improvements. But the previous inspection had called for a 10-year lease and the improvements were long overdue. There is little value in securing the physical exterior if the conferences within it are to decline in quality. It would appear that to restore morale among the staff; to establish good relations with the academic council; and to retain the existing director or to appoint a first-class successor, it would be necessary for the Government to offer the existing director a new contract on similar terms to his existing contract and to allow the management of the Wiston House conference centre to organise, without outside dictation, conferences and related activities within an overall budget.

I hope that the noble Lord, Lord Belstead, will be able to indicate some relaxation in the Government's attitude when he comes to reply. It is in the light of all that I have said that I ask the Government this Question, and I ask them to explain why they have behaved as they have and to say whether it is not a fact that their actions will endanger the quality and effectiveness of the international Wilton Park conferences.

8.35 p.m.

Lord Beloff

My Lords, the measured, accurate account given by the noble Lord, Lord Banks, would, I think, be sufficient to explain why he and other noble Lords, even at this late hour, feel that this is a matter worthy of your Lordships' attention. It is not a little local difficulty; it is a matter which reflects both on the competence and on the reputation of one of our great departments of state. Therefore, I should like, as the only member present—or ex-member as is now the case—of the Wilton Park Academic Advisory Council, not to traverse the same ground but to add some detail to make clearer why in my view the prospect of the Foreign and Commonwealth Secretary being able to fulfil his declared objective of having a prosperous Wilton Park is extremely doubtful unless there is a complete change of attitude on his part.

The noble Lord, Lord Banks, mentioned that there had been 12 resignations. I think it might be of interest to your Lordships if I said who they were because, to some extent, we are talking about differences of opinion between a great department of state and a group of private citizens. Sir Peter Tennant has been mentioned. He was the acting chairman after the lamented death of Sir Robert Birley. His reputation in the world of business and previously in public service is known to your Lordships. Then there were Mr. John Birt, who is Director of Programmes for London Weekend Television; the right honourable Edmund Dell, a former Cabinet Minister; Mr. Frank Giles, Editor of the Sunday Times; Mr. Richard Goold Adams, one of the two founders of the International Institute for Strategic Studies; Mr. Eric Heller, Labour Member of Parliament; Professor Rosalyn Higgins, Professor of International Law at the London School of Economics; Mr. Russell Johnston, Member of Parliament; Doctor Roger Morgan, Head of the European Centre for Political Studies at the Policy Studies Institute; Sir Denys Wilkinson, Fellow of the Royal Society and Vice-Chancellor of the University of Sussex; and Mr. David Watt, Director of the Royal Institute of International Affairs. It seems to me that it would be arguable, if I may misquote Oscar Wilde, to say that losing one or other of these members was a misfortune, but to lose all 12 does smack of something rather more serious.

What were their reasons? Their reasons relate—and to some extent this has already been adequately illustrated by the noble Lord, Lord Banks—and go back to the original decision as to how to implement the economies. To my knowledge, no member of the council felt that Wilton Park should be exempted from the pressure on public expenditure, just as none of us would have felt that the Foreign and Commonwealth Office as such could escape the cuts which were being demanded from other departments. The question was the extent of the cuts, the methods by which they were made and the impact of the particular cuts upon the efficiency and morale of the institution.

As the noble Lord, Lord Banks, said, what happened was the production by one of Her Majesty's inspectors in the Foreign Office staff of a report which I have here. I should like to emphasise that it is the unanimous opinion, both of those who have resigned from the academic advisory council and of those who remain, that that report was not compiled according to the normal standards by which such reports are compiled and of which many of us had experience, because Wilton Park, like other establishments under the Foreign and Commonwealth Office, is naturally subject to periodic inspection. But the normal practice is that the inspector would consult with the staff of the establishment concerned, particularly, as the noble Lord, Lord Banks, said, in estimating the workload, the nature of the work and the kind of people required to make it effective.

In this particular case, where, from the very beginning, the Foreign and Commonwealth Office had provided for an academic advisory council because originally it did not regard itself as competent to run directly and without advice a quasi-academic institution, one would have thought that the inspector would also consult people like Sir Peter Tennant, or, if you like, myself, who have been associated for a quarter of a century with the operations of this establishment.

I know, because I have heard him say it before, that the noble Lord, Lord Belstead, will come to the defence of his inspector and say that none of this is correct. If I may say so, I think that the noble Lord and, indeed, alas! the Secretary of State have a very curious version of ministerial responsibility. Ministerial responsibility is usually held to mean that if a civil servant makes a mistake or performs some function inadequately, he will not personally be blamed or suffer, but the Minister himself will take responsibility because it is part of his department. The interpretation which the noble Lord, Lord Belstead, and the Secretary of State have placed on responsibility is quite different. Their view is that if a civil servant or a group of civil servants says that something has been done correctly, not merely the kind of reasonably distinguished people whom I have listed, and not even the Archangel Gabriel himself descending from Heaven, will be allowed to persuade the Minister to the contrary. All our problems go back to that report.

It is true—and, indeed, the noble Lord, Lord Banks, has given some detail—that there was a long process of bargaining, with worry about the future, no doubt, on both sides; that concessions were made; and that some of the original recommendations were, in fact, thrown overboard. There was, of course, the important debate in another place to which the noble Lord, Lord Banks, referred. I would point out that among the speakers who criticised the action of the Foreign and Commonwealth Office in that debate was Mr. Richard Luce, who until not so long ago had served as a Minister in the Foreign and Commonwealth Office and could be presumed to have something of an inside view.

The council and, indeed, the director and his staff were very conscious of the financial pressures. One of the things they suggested was that a certain amount of extra time might be given to them, because it was clear that Wilton Park's reputation stood so high in the United States, in Germany and in other European countries that it was quite likely that from the 15,000 who had passed through its doors further money could be raised to supplement what Her Majesty's Government felt they could afford. There has also been, though the details have not yet been finalised, a very generous bequest from the late Sir Heinz Koeppler, most of whose working life was spent in that establishment.

But the main point, apart from the question of the director, to which I shall come, is that it became increasingly evident that the methods by which the objectives of the conference centre were sought were no longer to be decided by the directing staff or the academic staff advised by the advisory council, but were to be dictated to them from outside by civil servants who could not be expected to have the same experience or, indeed, any relevant experience of such an operation. It is this point—the feeling that not merely was the director being down-graded in a very particular way but that the academic council, its experience and its views were being pushed aside in favour of the views of civil servants—that partially explains the impasse.

With regard to the down-grading of the director, perhaps the noble Lord, Lord Banks, having a long story to tell, did not sufficiently explain the technicality which enabled the Office to do this. For reasons relating to the Civil Service Commission approval of appointments made not at the beginning of a public service career, when the present director was appointed, it was pointed out to the Foreign and Commonwealth Office that it could only be for a five-year contract, that it could not be until retiring age. But it was pointed out to him when he accepted the offer of the post—and the selection of the director was made in consultation with the new academic advisory council—that, although the Foreign and Commonwealth Office was prepared to go along with the position of the Civil Service Commission, he would at the end of his five years, if there was mutual satisfaction, be entitled simply to apply for a renewal of his contract on the same terms.

To take advantage of what was represented to him and represented to the academic advisory council as a mere technicality, to suggest downgrading his post in both status and financial terms seemed to us to be the one thing which it would be quite impossible for us to accept. Indeed, at one point the council suggested to the FCO that this particular issue, which is an issue of personnel management and does not have a great deal to do with economies or with the running of the conference centre, could be put to third-party arbitration. It was the refusal to accept arbitration on this single question of justice to an individual which precipitated what we must regard as a crisis, because the director has understandably refused to re-apply on the new terms and, as I have said, and as, indeed, the noble Lord, Lord Banks, has said, 12 members—a majority of the council—have resigned.

What about the present position? The Foreign and Commonwealth Office has asked the remaining members of the academic council to co-operate in the selection of a new director. But, as the noble Lord, Lord Banks, has pointed out, seven of them have informed the Minister that as, by and large, they share the views of their colleagues, they are not prepared to co-operate in the selection of a new director until there has been, with them, a radical re-examination of the role of the academic advisory council and the whole arrangement by which Wilton Park is maintained. They doubt whether they can usefully remain as members of the council unless this point is granted to them.

One could say, "Let them go, too; let the whole lot resign and the Secretary of State will appoint a new advisory council to take part in this procedure". I believe this to be wholly improbable, because, having read the letters of resignation of some of my colleagues, I cannot believe that anyone would consent to step into their shoes unless there was a change in the situation. For instance, both the Vice-Chancellor of the University of Sussex and Mr. Edmund Dell, an ex-cabinet Minister, have made it perfectly clear that, although they wish Wilton Park well and although they have valued their association with it, they cannot possibly be associated with what they regard as a piece of personnel practice which is itself dishonourable. If one vice-chancellor says that something with which he is connected has turned out to be dishonourable, knowing some vice-chancellors. I very much doubt that any of them would be willing to take over from him. Therefore, at the moment there is an impasse.

Of course, the Foreign and Commonwealth Office can go ahead and find someone—perhaps an ex-ambassador looking for some addition to his pension—to take over. But if that is done—if it is done as an internal appointment, with no assent from the wider business, academic and media community which has been associated with Wilton Park—it cannot possibly be kept a secret from the kind of people who come there (and Wilton Park has members of its conferences from this country, and not merely from abroad) and the reputation which the late Sir Heinz Koeppler built up and which Mr. Slack has continued—the reputation of a unique institution admired all over the world—will come to an end; and, rather than that, I suggest it be wound up altogether.

8.51 p.m.

Lord Greenhill of Harrow

My Lords, I have hesitated to intervene in this debate because I am no longer in any way involved with Wilton Park and my close connection with the institution ended nearly 10 years ago. But I was attracted by the controversy in the press and I have done my best to ascertain the situation. The conclusions to which I have come are not the same as those which have been expressed by the noble Lords, Lord Banks and Lord Beloff, and Lord Beloff has the advantage of being a member of the advisory committee.

When I last dealt with Wilton Park, in 1973, consideration was being given to how its usefulness could best be maintained and extended in the changed circumstances of that time. It had built up a great reputation for its work immediately after the war and a new role had to be found for it if it was to continue. It seems from all reports that a new role was successfully found and that Mr. Slack and his team built up a great reputation for themselves; and tributes have been paid to them which I do not for one moment question.

However, it is always difficult to judge the value of this type of so-called information work, which is what it is; it is a part of the Foreign and Commonwealth Office's information work. I have no reason to question the tributes which have been paid to Wilton Park. I know that the noble Lord. Lord Beloff, rates the information value of Wilton Park highly, because he wrote in The Times about that some months ago. But it is difficult to prove the value of such an organisation. It is very easy to exaggerate its influence, and it is debatable whether money spent at Wilton Park—and it is by no means shoestring money—might better be applied to the BBC external services, the British Council or overseas students, and I should be interested to hear the noble Lord's views on the competing priorities of those organisations.

At the same time, I wonder whether some of the public tributes which have been paid to Wilton Park hark back to the regime of Sir Heinz Koeppler and the reputation it built up in the special circumstances of the postwar world. In my official experience, the centre has always been a target for economies under Governments of both parties. There was always a fundamental question whether the activities of Wilton Park were an appropriate function of the Foreign and Commonwealth Office. It is a reasonable question to ask, but the Foreign Office have always successfully defended Wilton Park against its critics.

But—and this point has been glossed over, I suggest—pressure has been built up recently to make economies there, and this pressure has come from the Public Accounts Committee as well as from the Financial Secretary to the Treasury. There was no way that the Foreign and Commonwealth Office or the Foreign Secretary could brush aside the pressures and ignore them, and it was right that the effectiveness of Wilton Park's organisation should be closely examined. Once again, I understand that the Foreign Office did their best to defend the worthwhile activities of Wilton Park in spite of the greatest pressure that was being put at the same time on the central functions of the Foreign and Commonwealth Office.

As we know, Ministers eventually agree that a radical review of the centre should be undertaken. That was done by a senior Foreign Office inspector and a team of outside consultants. Members of this House, including the noble Lord, Lord Gladwyn, have full experience of what these inspections are like; they are intense and one must expect controversy to follow from them. However, I think it must be admitted that the review revealed some shortcomings in management and plenty of scope for savings. As was to be expected, the Wilton Park Advisory Council and the director opposed many of the review's findings. It was perhaps natural that they should do so, and they should congratulate themselves that they succeeded in persuading Foreign Office Ministers to overrule many of the recommendations of the inspector's review.

In the end, I am led to believe, there remained only two sharp differences of substance. The first was the proposal that the academic staff should be cut from five to four. The second was that the grading of the director should be changed. They are very serious matters and the academic staff have an understandable pride in their independence and qualifications. It would be easy to imagine that the review was very distasteful to them, and they might well have thought that the composition of the review body was not entirely appropriate to a critique of their work. Nevertheless, I understand that in the end the advisory council now accepts that a reduction of one in the academic staff is acceptable.

The position of the director is less happy. He is a man of distinction and achievement and he is being asked to accept a lower grade in the hierarchy. If I understand the position correctly, this will not mean a cut in his salary but will put a lower ceiling on it than he had expected. Such an arrangement would be distasteful to anyone, but it is the natural and inevitable consequence of the pressure which is being brought to bear on the senior ranks of the Civil Service, whose expectations have been curtailed in the same way as and even more drastically than, the director's. It is difficult for me to judge from outside—and I know I am a prejudiced witness—whether it is more equitable to penalise the director or let the cut fall on someone in the mainstream of diplomatic work. I would be inclined to believe that it is, both in terms of workload and in terms of the responsibility that is put on the diplomatic staff.

In my view it is an overstatement to argue that the question of the director's grading will diminish him in the eyes of visitors to Wilton Park. He will still be the director of the organisation, whose value visitors can judge for themselves, and the fact that in salary he will receive less than he might at one time have expected will surely not lead him to be treated with less respect by the participants in the conferences. He has chosen, regrettably, not to accept the new contract, and one must sympathise with his decision. But, if I may express a view, I have somewhat less sympathy with the tactics that have been pursued in the press and in another place. I am sorry that a public quarrel has been allowed to develop over this matter, and I am sure that the noble Lord, Lord Belstead, will offer some detailed explanation as to how the impasse has been reached.

The total sum in economies which the centre is being asked to make is, I understand, £23,000, in a budget of nearly half a million pounds. This seems to me a manageable target, which, with ingenuity, could be met. Moreover, as has been stated, £50,000 has been spent on redecoration of the centre, an administrative bursar has been appointed (which will take a load off the academic staff), and the lease of the centre has been renewed for seven years, surely giving very clear evidence of a determination by the Foreign and Commonwealth Office to continue the work of the centre. Therefore, I believe that it is quite wrong to represent that the Foreign and Commonwealth Office is hostile to the centre, or wishes unduly to constrain its activities. In my opinion the cuts proposed are such as not to limit the effectiveness of the conferences, and surely it is the public airing of these differences—which should be amicably settled—that will do the most damage to Wilton Park.

9.2 p.m.

Lord Walston

My Lords, I intervene in the debate for two reasons. One reason is that many years ago I had the privilege of being a member of the academic council of the centre for a few years. I then formed—as indeed I had already formed before becoming a member—a very high opinion of the centre's work, and, as other noble Lords have said, that was due very largely to its first director, Sir Heinz Koeppler. Judging from what I have heard, its work since then has continued, and has altered to some extent with changing circumstances; but it still performs a very valuable service. I certainly would not argue with the noble Lord, Lord Greenhill of Harrow, nor indeed with any other people who hold that in these times of financial stringency cuts are necessary. If people were to say, "It is better to abandon Wilton Park altogether, the need for it has disappeared. There are other bodies which can do the work equally well, and the money which is spent on it can better be used elsewhere", I should approach that argument with a completely open mind. I do not feel that Wilton Park must continue, come what may, though, as I say, I am fully aware of its value, and I have a somewhat personal, sentimental attachment to it.

The other, more important, reason why I am intervening this evening is that I believe that this question raises a matter of wide-reaching principle. In his admirable speech opening the preceding debate today the noble Lord, Lord Boyd-Carpenter, made the very telling point that members of unions—specifically he was talking about the water workers—collectively did certain things which harmed innocent individuals, which as individuals they (the members) would never do. The noble Lord was absolutely right. We see that happening with the trade unions. We also see it happening with Government, with Ministers, and with civil servants. They are admirable individuals—generous, high-minded, honest—but they are prepared to do things which as individuals they would turn away from with abhorrence. I am not saying that this is one of those cases from which the noble Lord, Lord Belstead, as an individual would turn away with abhorrence. But I am quite certain that if he personally, or his right honourable friend the Secretary of State personally, had had dealings with an organisation such as Wilton Park—with the academic council—they would not have allowed it to arrive at the situation that it has now reached.

I do not know whether the cuts of 40 per cent., 30 per cent. 25 per cent. are the right cuts, and I certainly do not know whether the proposals of the inspector—aided by an outside consultant, the noble Lord, Lord Greenhill, told us—are the correct ones. But I believe that if there is an academic council which is appointed to advise on all the strategic matters concerning an organisation—in this case Wilton Park—that academic council must be trusted. We have heard a list of its highly distinguished members; but even if they were not so distinguished, the fact that they have been appointed by the Secretary of State implies that he has trust in their judgment; otherwise he would not have appointed them.

Therefore when there is disagreement between the director of Wilton Park and the inspector from the Foreign Office, surely there must be long, serious, detailed consultations with the academic council. Given the fact, as I think all noble Lords will agree, that they are reasonable and experienced men, if it reaches such a stage that they feel impelled to resign-1 2 of them—and the remainder to be on the verge of resignation, the only conclusion that I, as an outsider, can draw is that there has been gross mismanagement on the part of the Foreign and Commonwealth Office. I believe that this is one of the cases, a minor case admittedly, where bureaucracy has dug its toes in and where the individual judgments of reasonable people such as the noble Lord, Lord Belstead, have not been allowed to have their sway until it is too late—and then the die has been cast and the decision has been made.

Specifically, in the case of the director—I am sure an admirable person; I do not know him personally—from what we have heard from all three noble Lords who have so far spoken, I do not think that his treatment is something about which any of us as individual employers would feel proud to talk. If you employ somebody on a five-year contract with the implied undertaking that if he is satisfactory he will continue at that level, at that grade and (given the circumstances) at the appropriate salary, and then you come along at the end of the contract and say, "We will not renew your contract—not because you are not satisfactory"—for he obviously is satisfactory because he was asked to apply for the job at a lower level—"but we will give you another contract at a lower level", that is not something which I believe any individual employer would do to a good, faithful employee and servant who has done good work for five years.

I am quite certain that the noble Lord, Lord Belstead, and his right honourable friend would not themselves contemplate doing such a thing to people employed by them. That is why I believe it is right that the noble Lord, Lord Banks, supported by the noble Lord, Lord Beloff, has raised this matter, because it has far wider implications than the future of Wilton Park itself. It has implications affecting the trust placed by Ministers in a body of people, the academic council, that they have appointed to advise them—and that trust seems to be singularly lacking—and the relationship between the academic council (which has been appointed to oversee the whole running of Wilton Park) which is quite prepared for cuts, and very substantial cuts. There is, too, the matter of the anonymous people who were sent by the Foreign Office, and the fact that their recommendation has been accepted and that it has been impossible to reach any agreement over the very small but significant differences between them and the academic council.

9.11 p.m.

Lord Gladwyn

My Lords, I, too, would like to start with a declaration of interest because, like the noble Lord, Lord Walston, I was myself a member of the academic council at Wilton Park for a number of years, and when I was there I spoke quite often at meetings at that centre. I was also, I hasten to say, a great friend of that magnificent man Heinz Koeppler, who transformed Wilton Park from its original function as a body, I understand, for re-educating Nazis, into one of the most influential political conference centres which exist at the present time. Nobody did more than did Koeppler to re-create some form of understanding between the British and the Germans after the war. More than that, the late warden was a splendid advocate of his adopted country—more particularly, perhaps, in the United States where the Friends of Wilton Park, as they are called, is an organisation which he personally created and is still an important element in the fabric of Anglo-American relations.

Poor Heinz must be turning in his grave, I feel, as a result of the recent misunderstandings involving the resignations of Sir Peter Tennant, the acting chairman, and the bulk of the members of the academic council—to say nothing of the impending resignation, I understand, of the director, Mr. Slack. Not having myself been concerned with the affairs of Wilton Park for a number of years, I shall not attempt to go into great details or to take sides in the recent row, beyond saying that I can hardly imagine that Sir Peter Tennant would have resigned without good reason. I have known him for a very long time and have always regarded him as a sensible and fair-minded person. Moreover, since he is, after all, a most distinguished ex-member of the Foreign Service, I find it difficult to understand how it came about that he fell foul of his old department, and in such a spectacular way.

I venture to ask the Government one preliminary question. Why should not the Foreign and Commonwealth Office, in view of the, admittedly important, general economy campaign which is affecting them quite severely, merely have demanded a reduction of, say, £x in the general budget of the institution, and then left it to the director, assisted of course by the academic council, to work out a plan or plans showing how the necessary economies could best be carried out? That seems a simple way of proceeding; I do not understand why it was not followed. I know that the Public Accounts Committee have in the past severely criticised Wilton Park, and that the Permanent Under-Secretary of State for the Foreign and Commonwealth Office is directly responsible to that committee.

However, was it really necessary for one of the Foreign Service inspectors to be sent down to conduct a special inquiry of his own without, it would seem—and from what has been said it is probably true—too much regard at least for the feelings of those concerned? After all, Wilton Park is hardly the equivalent of a diplomatic mission. Surely it is more in the nature of an academic institution and deserves to be treated as such. Why not, in other words, leave the administration in a general way to large extent to the organisation itself? I merely ask the question, and no doubt the noble Lord the Minister will deal with it in his reply.

Be that as it may, I believe that I am right in saying—and it certainly emerges from what has already been said—that whereas there was, after great argument, eventual agreement on the extent and nature of the economies, the negotiations finally broke down on one point only; namely, the insistence by the Foreign and Commonwealth Office on a reduction in the status of the director, the Foreign Office insisting—as I understand the reason—that since a number of under-secretarial posts in the Foreign Service were going to be phased out as a result of the economy campaign over the coming years, the director of Wilton Park should not be allowed, as it were, to escape the axe. That was really what they said.

I understand that the academic council felt that Mr. Slack was after all an unsalaried officer who had taken on the job, as I think the noble Lord, Lord Walston, said, on the understanding that if the contract was renewed he would enjoy his status as an Under-Secretary. That was a definite understanding. So it is, I imagine, at least possible to accept the fact that he feels to be under a considerable grievance, more especially since, as I understand it, Foreign Service officials of under-secretarial rank whose jobs may disappear, and will disappear as a result of the coming economy campaign over the years, will either be employed elsewhere or given the opportunity to retire on very favourable terms, which is not exactly the position in which Mr. Slack finds himself at Wiston House.

The decision to degrade the director has in any case—and here I simply draw attention to a fact—been very strongly criticised in the latest report of the Foreign Affairs Committee of the House of Commons whose chairman, I note—I say I merely "note"—has now declared that the indirect result may be, a weakening … of the British Government's commitment to the aims of international co-operation espoused by Wilton Park over the years", this being, an unsatisfactory outcome to an unnecessary dispute". The committee goes on to question the necessity of, the enforcement of such marginal expenditure cuts with such damaging consequences", and doubts whether, the small financial saving can justify the resulting ill-will and resentment". The committee's general conclusion is, an institution which appears to be a section of the Foreign Office is less likely to command respect than one which is plainly independent in direction and motivation from the Government machine". Those are strong words, and I shall be most interested to note how they are countered—if they are—by the noble Lord who is going to reply. The committee also believes that the future of Wilton Park would be more likely to be secured if it were to be freed from direct control from Whitehall and supported instead by contributions from the British Government, the other OECD Governments and appropriate private organisations.

I said at the beginning of my brief remarks that it was not my intention to take sides in this unhappy affair. But as regards the possible future of Wilton Park, I entirely concur in the final recommendation of the House of Commons Committee which I have just read out. In order to achieve the sensible end, as it seems to me, I suppose it may be necessary to legislate. If so, I can only say that the sooner a suitable Bill is prepared and presented, the better for everybody concerned. Perhaps the Minister who is to reply will tell us that this is indeed the Government's eventual intention. I sincerely trust that he will.

9.20 p.m.

Lord Hooson

My Lords, I suggest that the Foreign Office's intransigence in this matter is deplorable. It is deplorable from the public point of view. I have no interest to declare. I was a participant in a Wilton Park conference many years ago when the powers-that-be considered that I needed a bit of brain-washing on my attitude towards Europe. I knew Mr. Slack when he was a distinguished headmaster of a famous school. But the point at issue in this matter is surely one of principle. We are not dealing, as it were, simply with an economy measure by the Foreign Office. We are discussing a relationship which could have happened in any Ministry or with any employer between a very distinguished man and his employers.

As I understood the noble Lord, Lord Beloff, he said that when Mr. Slack was apointed there was not an implied understanding; there was an expressed understanding. And when the noble Lord, Lord Walston, referred to an implied understanding he was understating the case. There was an expressed understanding between Mr. Slack and those who appointed him that if mutual satisfaction was given on both sides the contract would be renewed. I take it there was no suggestion then that it would be at a different grade—a downgrading. Let us reduce this to the basic principle that we should need to consider if this were to occur in any other relationship. It is a dishonourable act to go back on that matter.

I think there are certain Machiavellian aspects to this matter. The noble Lord, Lord Belstead, is going to wind up this debate: could he tell us whether any single Under-Secretary, an in-house Under-Secretary at the Foreign Office, has been downgraded in this way? It is of some importance that Mr. Slack was appointed from outside and therefore had to be appointed in this particular kind of way, with a contract offered, because of the attitude of the Civil Service Commissioners. But is there a single example within the Foreign Office of an Under-Secretary being actually downgraded or offered a post at a lower grading? I do not think there is.

I am bound to say that I found the attempted justification put forward today by the noble Lord, Lord Greenhill, completely unconvincing. For example, he doubted the efficacy of such institutions as Wilton Park and he said (which indeed is quite right) that it is impossible to gauge their effectiveness—just as in this House when we had a debate on the proposed curtailment of our foreign broadcasts it was argued by many people on behalf of the Government that it was very difficult to gauge their effectiveness. In fact, one has to make a political judgment in these matters; but I am content to rely on the Foreign Office's own judgment in the matter.

The Minister of State is going to reply and I do not know what he will say, but I am relying on the letter that he wrote to The Times, which was printed on 15th November, 1982. In the second paragraph of his letter he said this: There is no question of damaging, much less abolishing, this excellent institution.". My Lords, note the words "this excellent institution". The letter goes on to say in the same paragraph what steps have been taken to strengthen it: We are also improving the facilities there and strengthening the administration. So this is in no way suggesting, as did the noble Lord, Lord Greenhill, that perhaps its value had been overestimated before and that at the present time the Foreign Office were of the opinion that its value was less than it had been in the past.

Then, in the third paragraph, the noble Lord, Lord Belstead, went on to say that it was essential to ensure full cost-effectiveness. He continued: We therefore conducted a comprehensive review with the assistance of management consultants. This confirmed our conclusion that the conferences run at Wilton Park are a unique and successful information activity". Was that the judgment of the Foreign Office, to which the Minister of State was putting his pen? If it was, then it belies any suggestion made by the noble Lord, Lord Greenhill, today that Wilton Park might no longer, as it were, have its former effectiveness and be the unique institution that it was in the past.

The same paragraph went on to say: The review also suggested certain improvements and economies". That is all that is mentioned about improvements and economies. The next paragraph went on to speak of, savings …taking into account the suggestions of the Academic Council"; and he concluded by saying: These measures will not, in any way, affect Wilton Park's academic freedom, which we are determined to safeguard. They are designed to strengthen Wilton Park's long-term future and I am confident that, with the co-operation of all concerned, its high reputation will be fully preserved. So we have here the attitude of the Foreign Office, expressed through the Minister of State, confirming the value of this institution and that there is no intention of downgrading it in any way.

How does that square with the totally dishonourable behaviour of the Foreign Office in this matter? I should have thought it was of the greatest importance that out of, I think, 21 members of the Wilton Park academic council, no less than 12 resigned and 7 of the remaining 9 published the fact that, on all the basic issues, they agreed with the 12 who resigned. It is Machiavellian of the Foreign Office to argue, for example, that the academic council virtually agreed everything in the end except the director's grading.

I have been in the legal profession all my life, and I negotiate settlements every week. I so often have negotiated settlements when my opponent has said, "I will give you that point and that point, provided that I get point A. If I can have point A, I will grant you points B, C, D and E as a matter of negotiation". But to say afterwards, when the negotiation breaks down and when point A has been conceded, "Oh, you gave up all the other points", is entirely Machiavellian. We know perfectly well that what the academic council did was done in order to try to achieve a compromise, without this terrible public row which has since ensued. They gave way, as it were, on points to which they attached considerable importance, simply in order to preserve their major point, which was that there should be no down-grading of the director.

When the Foreign Minister wrote to Sir Anthony Kershaw in March this year and said that the only real point of difference with the academic council was the director's grading, that was wrong. There were many differences, but the academic council were willing to give way on them, provided that the Foreign Office gave way on the director's grading.

Therefore, I conclude, as I am bound to do, that this intransigent position which has been taken up by the Foreign Office does this country no good at all. It also does the Foreign Office no good, and if any department of state needs a few friends these days it is the Foreign Office. The Foreign Office has allowed this row to develop publicly. These very distinguished academicians have resigned. I know a number of the members of that academic council and they would not have resigned easily. They would have considered their positions very carefully, before tendering their resignations as they did. At the moment it is simply stubbornness and intransigence on the part of the Foreign Office which allows this public and unseemly row to continue when all they need to do to achieve compromise is to behave honourably.

9.30 p.m.

Lord Ezra

My Lords, the debate so far has shown that although this apparently relatively small matter could have been settled quite easily, by being allowed to drag on in this way it has raised a number of much more fundamental issues. At this late hour I should like to confine my few remarks to one such issue. I contend that at the present time—more, perhaps, than at most times in our history—it is necessary for this country to be able to project itself effectively abroad. A proper understanding of our affairs, our thinking and our approach to life can bring tangible benefits in providing a better climate for our exports. It can bring intangible benefits by enabling us more effectively to participate with other nations in dealing with some of the very difficult issues which face us all. At the very time, therefore, when we should be expanding the means that we use to project ourselves abroad it is sad to note that repeated proposals appear to be made to move in the opposite direction.

Reference has already been made to the repeated efforts to limit the operations of the overseas service of the BBC. This provoked a very strong outcry, in which I have no doubt many of your Lordships participated. Subsequently, second thoughts fortunately prevailed. There was a similar outcry when severe limitations were placed on the grants given to overseas students. Very quickly after those grants were removed, serious limits upon our expert prospects in certain countries ensued. In that instance as well, wiser thoughts eventually prevailed and certain modifications were introduced.

Therefore we come to the third issue about which we are concerned in this debate; namely, in spite of protestations to the contrary, the diminishing of the impact which Wiston House has so successfully created over the years. Many of us have attended functions there. We knew Heinz Koeppler and admired him. The last time I saw him was in the heart of Texas at Baylor University, spreading in that distant land what he had been spreading here in Britain. Judging by the reaction of the young Texans who were listening to this from him, they liked it and respected him for it. This was achieving what we ought to be doing at the moment. We should not be doing the reverse.

Therefore I should like to add my voice to those of other noble Lords who have expressed their doubts and concern, because I spent very many years trying to project our image abroad in the interests of the industry which I served and of promoting our exports. I am saddened indeed at these repeated attempts, in the interests of what appear to be very small economies indeed, to diminish the ways in which we can serve our wider interests. I hope, with others, that when the noble Lord, Lord Belstead, responds to the debate he will indicate that in this case also the Government will have second and more constructive thoughts.

9.34 p.m.

Lord Stewart of Fulham

My Lords, like others who have spoken, I am one of those who visited Wilton Park, was acquantied with its work and knew and admired the late Dr. Koeppler. It has been a very sad, unhappy story to which we have been listening. I am not going to go in detail over the facts, because that has been well done by previous speakers. What I want to do is to draw the attention of the noble Lord the Minister to this point. A great deal of damage has now been done by the publicity that has arisen. The publicity was bound to arise in view of what had been done; this was not something about which people could keep silent. The noble Lord the Minister has to ask himself whether there is at this stage any way in which he can mitigate and reduce the damage that has been done to Wilton Park and to the whole conception of Britain's presentation of herself abroad.

There are one or two matters which are quite clear and indisputable. One is the value of Wilton Park itself, which was set out in many other contexts and in the letter from the noble Lord, Lord Belstead, in The Times. Nobody would seriously dispute its first-class value. Secondly, it is not disputed that when Governments are, of necessity, in a mood to go around looking for economies they are entitled to look everywhere. But how did they view the matter in this case? In the first instance, it was done by sending down an inspector's assistants, who appear to have behaved in a remarkably inconsiderate manner. There is in the report of the Foreign Affairs Committee in another place a letter from the Foreign and Commonwealth Office, at the end of which they try to defend the activities of that inspection. Noble Lords who read that letter will find that it is remarkably unconvincing. This body found that they would make economies totalling 44 per cent. This was not a serious proposal of economy; this was a proposal of butchery. It is significant that it was not very long before the Foreign Office itself resiled from that extreme position—but a great deal of harm must have been done by showing that degree of lack of consideration in coming up with a figure of that kind.

The Foreign Office resiled to a figure of 30 per cent. Wilton Park itself put forward a figure of 25 per cent., so nobody can criticise Wilton Park for having been obdurate, failing to recognise the national need, or being guilty of all the other reproaches of the people who criticise economies in public expenditure. That left a gap of 5 per cent., or £23,000. By this time by comparison with other forms of negotiation, surely one ought to have been within sight of a settlement without all the bitterness that subsequently ensued. But the Government would not budge to bridge that gap of £23,000. We now learn that the position taken up by Wilton Park is that they are prepared to see that gap narrowed still further to about £5,000. All that remains in dispute is the position of the director and one or two other matters, and certain matters affecting the degree of the independence and autonomy of the institute.

I fully agree with the description of the noble Lord, Lord Hooson, in respect of the bargaining: that it is not open to the Government to say that all they are arguing about now is the position of the director. That situation has been reached by the willingness of Wilton Park to concede other points and the unwillingness of the Government to concede anything other than its first retreat to the position of 30 per cent.

This means that it is possible for the Government now to do something to get this right. They could concede the point about the position of the director. If the noble Lord, Lord Belsted, and his colleagues feel that that would be a sacrifice of prestige on their part, let us remember—as has been pointed out—that in two other matters affecting the field of information the Foreign Office has given way from the position it first took up: over broadcasts and over overseas students. And nobody has reproached the Foreign Office for doing so; it has won nothing but good opinion by its change of attitude on those two points. Surely it is not too much to ask that they could change on this point as well.

Consider what is at stake: if they persist in the present position, the members of the academic council are not going to change their minds. Those resignations will stand; the opposition of those members of the council who have not resigned will still stand; Mr. Slack will not be prepared to take a new position in the unsatisfactory circumstances laid down by the Government; the Government will be put to the task of trying to find somebody who will accept that position, a position which by now has been degraded by the attitude of the Government towards it and by the very clear indication by the academic council of what they feel is involved in the Government's behaviour. To allow that to happen might be to inflict irreparable damage upon Wilton Park. When one weighs that and all the loss that that would mean, after the years of valuable work that Wilton Park has done, against what is involved now in the Government's coming forward and being able to bridge the not very large remaining gap, surely there can be no doubt as to what decision the Government ought to take. I hope the noble Lord will be able to tell us tonight that they will be prepared to take it.

9.41 p.m.

The Minister of State, Foreign and Commonwealth Office (Lord Belstead)

My Lords, I welcome the opportunity to reply to this Question by the noble Lord, Lord Banks, for two particular reasons. First, I can assure your Lordships that my right honourable friend the Foreign and Commonwealth Secretary attaches great importance to Wilton Park and values it as a unique British contribution to international understanding. Secondly, our aim has not been to impose cuts, as the Question of the noble Lord says, but to do our best to improve cost-effectiveness. It was the noble Lord, Lord Greenhill of Harrow, who referred in his speech to the financial pressures which are upon all Government departments, and that does not except a valuable institution like Wilton Park. I really do assure your Lordships this evening that, far from endangering the quality of the conferences, our aim has been to provide them with an assured future.

In his report on the Foreign and Commonwealth Office Appropriation Accounts for 1980–81 the Comptroller and Auditor General commented on one subject only and that was Wiston House, the house in which the Wilton Park conferences are held. He asked some searching questions, such as why the premises were under-used, and why there was such a large annual deficit; and he pointed out that no other Government finances a conference centre of this sort. The Committee of Public Accounts of another place then pursued the matter with more questions to the Permanent Under-Secretary at the Foreign and Commonwealth Office, who, of course, as accounting officer is directly responsible for Wilton Park's finances, and must answer questions put by the Public Accounts Committee, which, as the noble Lord, Lord Gladwyn, correctly divined, is the reason why it is not possible to give the director of Wilton Park complete freedom to dispose of all resources within the budget for the establishment.

My Lords, at the same time the Foreign Office, like all Government departments, has been contributing towards public expenditure reductions. Between 1979 and 1984 there will have been a 12 per cent. reduction in real terms in the Foreign Office Votes, excluding the ODA. Over the same period Foreign Office manpower is being reduced by 11 per cent. as a contribution towards the Government's policy of reducing the size of the Civil Service. Thus, knowing that the lease was due for renewal early in this year, it was clearly necessary, back in 1981, to consider seriously the future of Wilton Park.

One option would have been to end it completely and thus save nearly £500,000 every year of taxpayers' money. Instead, Foreign Office Ministers took the firm decision to preserve Wilton Park but to explore all avenues for improving efficiency. Therefore, it was at the end of 1981 that they called for a radical review to achieve savings of at least 25 per cent. They insisted on full consultation both with the director and with the Wilton Park academic council—an advisory body whose support has been greatly valued over the years. They also set a deadline at the end of January 1982 for receiving the reviewers' report, but this was extended, partly to allow the director a further five days to comment on the draft.

The report was prepared by a three-man team, including a chartered accountant, with the aid of an independent firm of management consultants. The report fulfilled its remit of making radical proposals, and undoubtedly the proposals for improving the conditions at Wilton Park, and the capacity of it, will increase the appeal of Wiston House as a conference centre. Incidentally, I would just say in answer to the noble Lord, Lord Banks, that the inspecting officer carrying out the review examined the academic staff workload most carefully, and I hope that your Lordships will accept that the review was carried out with complete propriety.

There then began a year of consultation, and between them the academic council and the director submitted four memoranda to Ministers, attended three full council meetings with Foreign Office participation and took part in several meetings and exchanges of letters with myself. I must at this point make it crystal clear to your Lordships that I am the junior Minister who has been responsible for the affairs of Wilton Park, and the decisions which have been taken throughout have been taken on my recommendations to the Secretary of State and must not be laid at the door of those who work officially in the Foreign Office, in whom I have every possible confidence.

On behalf of the Secretary of State I accepted the majority of the proposals which came from the academic council and the director; for instance, the retention of two staff posts which would otherwise have been relinquished and half the extra-mural visits, although my noble friend, with his characteristic generosity, wanted all of them to be retained. That was a particular point put by my noble friend Lord Beloff at a meeting last year. A modification to the proposed increase in fees was another point where I hope I went a good way towards meeting the points which were put. Also, of course, staying at Wiston House when a move to a commercial conference would have been feasible, and exploring the uses to which outside finance could be put were, again, points where I made it clear that we could go a very long way, if not the whole way, towards meeting the points that were being put to us.

For its part, in a letter dated 14th January this year, the academic council said that it would accept substantially the proposed reductions in expenditure. It believed there would need to be a radical reassessment of how Wilton Park could operate with one fewer member on the academic staff—a belief, I have to point out, that was not shared by the review report—but the council said it felt very strongly about the position of the director. Thus, at the end of a long period of discussion it was essentially the question of the grading of the director's post about which there was disagreement.

I must make it clear that there is no question of regrading the post until the present director's fixed contract expires this May. Nor is this a question of financial economy. The annual saving in itself is only some £3,000. But one aspect of the Government's manpower policies is to reduce the number of under-secretaries in the Civil Service. The contribution of the Foreign Office towards this policy is to reduce the number of under-secretaries serving in London from 31 to 25, or by nearly 20 per cent.

I do not complain that this evening criticism has come from the noble Lord, Lord Stewart of Fulham, on the Opposition Front Bench, from several noble Lords on the Liberal Benches and from the noble Lord, Lord Walston, on the SDP Bench about the regrading of this post, because the political parties of those noble Lords have not taken the view that it was necessary to reduce the size of the public service in this country. But I have to make it clear to the House that I serve a Government which do have that policy. At the beginning of this Administration Government departments were all asked to undertake a rigorous assessment of their senior Civil Service posts. This was done in the context of the more general target of a 14 per cent. reduction in the Civil Service, so that by 1st April of next year the Government aim to have reduced the total size of the Civil Service from 732,000 to 630,000.

In that context, my right honourable friend and I considered very carefully indeed whether it was right to include the directorship of Wiston House among these posts. Taking into account all the criteria, including an objective assessment of the workload and the responsibilities of the Wilton Park job compared to others in the diplomatic service, we believe it was right to do so. I will certainly draw my right honourable friend's attention to the view of my noble friend Lord Beloff of my right honourable friend's and my interpretation of our ministerial responsibility in this matter, but I hope that I have said enough to show that we took account of all possible considerations in reaching our decision.

It is worth pointing out that Sir Heinz Koeppler, the distinguished founder and the only other director of Wilton Park, had held for 27 years, until 1973, the DS4 rank to which we are reverting. I am sure that no one then thought that Wilton Park's status depended on the grading of the director. I was interested that, with his experience as Permanent Under-Secretary in previous days at the department, this was a point which was made by the noble Lord, Lord Greenhill of Harrow. I really do think that for the overseas participants the grading of the director and the status of Wilton Park rest on the prestige and reputation of the conferences and the high quality of the staff, to whom, of course, I pay tribute.

Nor is our decision in any way a reflection on the present director, for whose work we have a high regard. Last June, nearly a year before his present five-year contract expires, I asked Mr. Slack to serve for a further five years. I must make it clear to the noble Lord, Lord Hooson, that no promises were made when the original contract was agreed about the grading of the post in the longer term. We also made special arrangements whereby, instead of assuming the lower DS4 salary, under a new contract the director would have retained his present salary, including any increase which would be due for the public service this April, until the DS4 salary scale caught up with it. This was an exceptional offer and in a way amounted to the creation of a separate status for the present director. We also made special arrangements to enable Mr. Slack to buy additional years of pension and, at his request, to undertake outside consultancy work to supplement his income.

Lord Hooson

My Lords, I am most grateful to the noble Lord for giving way. He said that no promise was given to Mr. Slack as to the grading of the post. But was anything suggested to him—not a legally binding promise? Was there an undertaking given, expressly, as Lord Beloff said, that if satisfaction was obtained on both sides, as it were, the contract would be renewed? Was any suggestion then made that the post would be downgraded?

Lord Belstead

My Lords, the answer remains exactly the one which I have already given to the House. No undertaking was given about the grading of the post in the future. The letters are in Mr. Slack's possession and they are also in the possession of the department. There is nothing secret about this. The noble Lord, Lord Hooson, by talking to Mr. Slack, would be able easily to see what was put in print.

Lord Hooson

My Lords, I am grateful to the noble Lord for giving way. This is a very important matter of principle. If one appoints a man to a job in a certain grade and it is said, "If you give satisfaction for five years and both sides are satisfied, then you are very likely to continue in that position", and nothing is said about grade, it is implied surely that he will be in at least the same grade?

Lord Belstead

My Lords, the noble Lord is giving legal advice to the House and that is certainly something which I have no intention of doing this evening. I have given the House the position quite openly and honestly. I have told the noble Lord, Lord Hooson, that the letters would be there for him to see if he wished to ask Mr. Slack, and it would be for the noble Lord to make up his own mind as to whether he accepts his own legal advice or not.

The noble Lord, Lord Gladwyn, quoted the words of the Foreign Affairs Committee of another place. Indeed, they considered this issue very carefully in a report dated December 1982 to which were attached three Foreign Office papers and three from the academic council. The Foreign Affairs Committee concluded that they did not feel able to recommend in favour either of the Foreign Office solution or that of the academic council. However, this month the committee wrote to me—indeed, the noble Lord, Lord Banks, quoted from the letter—expressing concern at the various resignations, and suggesting that we were disputing unnecessarily over a small financial saving. My right honourable friend the Foreign and Commonwealth Secretary has himself replied explaining that the only real point of dispute, the director's grading, concerned manpower policy rather than financial economy. For the future, I am glad that Mr. Slack has agreed to help us find a successor. He has already offered his advice on the wording of a suitable advertisement and other particulars for candidates. I have told the remaining members of the academic council that I would welcome their participation in the selection process and that I hope to meet them in a formal session soon.

Since the noble Lord, Lord Walston, has made charges of mismanagement, I must point out that it is perhaps regrettable that several times since last June the council have chosen to meet privately without Foreign Office participation, when I believe that participation might have done much to clear away misunderstandings. But for now, I am confident that there will be many good candidates for the position of director, bearing in mind the nature of the job.

Lord Beloff

My Lords, will the noble Lord give way? He said, quite correctly, that he had invited the surviving members of the academic advisory council to assist in the selection of a new director. But is it not also the case, as I have already indicated, that they have in fact declined to assist him until their wishes are met on other matters?

Lord Belstead

My Lords, that is an extraordinary assertion considering that I have not yet met the remaining members of the academic council—of whom the noble Lord, Lord Beloff, is no longer, sadly, one. Until I do meet them I cannot find out what their feelings are. However, I must not be disingenuous. It is perfectly true that I have written to them and that they have replied. But I hope that the noble Lord will not pre-empt what I hope will be a useful meeting when that meeting takes place.

Lord Banks

My Lords, I wonder whether the noble Lord would like to indicate to the House the nature of the reply which he had from the academic council?

Lord Belstead

My Lords, they have reservations exactly along the lines which the noble Lord, Lord Beloff, has put to the House. But I would say to the noble Lord, Lord Banks, that I hope that the trouble that there has been up to the time of this debate is not going to be allowed to affect a meeting at which neither the noble Lord, Lord Banks, nor my noble friend Lord Beloff will be present.

I should like to revert now to how I see the future. First, I believe that Wilton Park will find a good new director because of the nature of the job. Secondly, I believe that a new director will find that Wilton Park is fortunate in having many good friends; that it is located in a lovely place; and that the post enjoys genuine autonomy. On that last point, because so much has been said about it this evening, I would quote Heinz Koeppler. He once said: So far as administration and finance are concerned, the warden, (as he was then called) is just like any other head of a Foreign Office department…on the academic side, however, the warden enjoys independence and freedom". That remains the case today. I have also made clear to the academic council that within the Foreign and Commonwealth Office's responsibility for the finances of Wiston House, a large degree of management discretion most certainly is possible.

As a demonstration of our faith in Wilton Park's future, we are renewing the lease for seven years as compared with the previous five-year lease. We are injecting a good deal of capital to improve the accommodation and modernise the office equipment. A new post of assistant bursar has been created to strengthen the administration, and we are arranging for the bursar to have special training in conference centre administration. We are also encouraging our posts abroad to do all they can to help recruit participants for the conferences. We shall shortly be holding a meeting with the International Advisory Council, Wilton Park's second advisory body, which consists of OECD countries' ambassadors in London, at which we shall discuss the present management's aim of widening participation on suitable occasions to include third world countries. Last December there was a successful conference on Latin America and, indeed, another is to be held in September.

Wilton Park is a significant element of our overseas information effort, along with the British Council, the BBC External Services and the Foreign Office's information officers abroad. In listening to the speech of the noble Lord, Lord Greenhill, I was interested that he wondered whether these other information arms of Government—and, indeed, the noble Lord also included the desirability of spending money on overseas students—might not have prior claims on resources. I shall not follow the noble Lord down that path now except to say that of the elements that I have mentioned—in other words, the BBC, the British Council and the FCO information officers—it is only the latter which have suffered a significant reduction in expenditure recently, with a 20 per cent. reduction in information posts at our Embassies since 1979.

In Wilton Park's case we are aiming for a 15 per cent. reduction in current resources, with further savings to come from increased revenue from outside conferences, and we can also count savings achieved when the European Discussion Centre was merged with Wilton Park at the end of 1981. It is that which makes up the total package of around 30 per cent. This gives us a solid base to face the future. Wilton Park's success in projecting Britain owes a great deal to its impartiality and objectivity. Speakers and participants from all shades of the political spectrum are welcome, Wilton Park brings many influential people to this country, like the Central Office of Information's Sponsored Visits programme, with which Wilton Park co-operates closely. I say these things because I think it is most important to get across the message that I believe the taxpayer gets good value from the interchange of ideas and the winning of friends for Britain, which this forum provides.

I have no doubt that Wilton Park, therefore, can continue to prosper, but it will be no easy task. In a time of world recession, it will be hard work to continue to attract overseas participants, and a great deal remains to be done to build up the planned number of 16 outside conferences. Therefore, I particularly regret that Wilton Park will not have the advantage of my noble friend Lord Beloff and others serving on the academic council. But I am sure that the Government have been right to put Wilton Park on a secure and defensible basis for the years ahead. If we cannot agree on all things, I hope at least this evening we can agree in wishing it continued success for the future.

House adjourned at five minutes past ten o'clock.