HL Deb 11 December 1985 vol 469 cc211-24

2.56 p.m.

Lord Harris of Greenwich rose to call attention to the position in Liverpool arising out of the actions of the city council; and to move for Papers.

The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper.

Before setting out the case I wish to deploy this afternoon, on behalf of the right reverend Prelate the Bishop of Liverpool, I should like to express his regrets that he is unable to be here today, because he would have very much liked to participate in this debate.

We are discussing this afternoon a situation with few parallels in the local government history of this country. There have of course been previous cases where great cities have faced the prospect of bankruptcy. There was the case of New York City. There was the case of Cleveland in the State of Ohio. However, as far as I know, there has been no previous case where a city council has coldly and quite deliberately attempted to bring about its own bankruptcy. As we know, that is precisely what Liverpool attempted to do. They were frustrated only because of action which was taken in the courts by some of the teachers' unions when the city council attempted to sack 31,000 of its employees.

I propose to deal first with the economic and social background to the dispute: secondly, with the conduct of the council itself; and lastly with some of the longer-term implications. I turn first to the condition of the City of Liverpool. It is, as I think we all recognise, pretty desperate. We have in Liverpool an unemployment rate of 21 per cent., and in some of the central wards of the city there is now youth unemployment of around 90 per cent. There is no certainty that we have yet experienced the worst of the problem. Manufacturing industry, in decline for three decades or more, is likely to contract still further. The number of available jobs is likely to decline in the manufacturing sector by somewhere around 14 per cent. over the next six or seven years. There is little expectation that there will be a great deal of growth in the service area either. Indeed, some estimates suggest that there may be a further decline of employment here of around 8 per cent. in the same period.

I think we have a situation where there is great despair spreading through great swathes of the city. We have in many homes, one and sometimes two teenage children who have just left school and are unemployed; the mother who may have had a part-time job has also lost her job; the father is unemployed, and there may be one or two children still at school who also face the prospect of unemployment as soon as they leave. We have a situation where 50 per cent. of ratepayers are at the moment in receipt of housing benefits.

In addition to those sombre figures, we also have the accompanying problem of inner city dereliction. We have lamentably inadequate public services. Many schools are in a poor condition and there is one of the worst housing situations in England. A great deal of the postwar public housing is in a deplorable condition. Yet, unhappily, as we know, the city council appears only interested in expanding still further the quantity of public sector housing. They are unfortunately ideologically opposed to any private sector involvement or indeed to the work of the housing co-operatives.

That logically brings me to the second point that I want to raise this afternoon. That is the conduct of the city council. As we know, the city has been run by Militant Tendency. I believe that they have worked tenaciously to ensure that there is a policy of all-out confrontation with the Government. My noble friend Lord Evans of Claughton and I pointed out in a debate that we had in this House in March of last year that the one thing that one can say about Mr. Hatton and his colleagues is that they certainly have the merit of consistency. As soon as they had secured a majority on the council they announced that they would introduce a deficit budget. Last year, there was a very confused situation when they went on a delegation to see Mr. Patrick Jenkin, then Secretary of State for the Environment; and they came out claiming that they had won a famous victory. They persuaded themselves, and, I believe, many people in Liverpool, that they had won that victory.

Mr. Hatton and his colleagues thereafter boasted that a tough stand by them had made the Department of the Environment capitulate; and what had been a small majority for Mr. Hatton and his colleagues until then became far more substantial after the local elections of last year. At the same time they started to put large numbers of personal retainers on to the payroll of the city council. Senior officials of the council were put under heavy, and, in some cases, intolerable, pressure to conform. Let me give the example of one committee chairman. He still turns up every day. He is there when the mail is opened and he then decides which officials in his department should draft the response to those communications. He ensures that the papers are sent to those officials who he regards as ideologically sound. We have the case of the arrival of Mr. Bond as a race relations adviser to the council. His skills in that particular area were, I think, very limited. Indeed, there was great hostility expressed by ethnic minorities in Liverpool when he was appointed. Since then he has not been able to secure any degree of co-operation from them, despite the immense problems in his area—the community problems of Liverpool of which, after the Toxteth disturbances of 1981, we are all aware.

In addition they built up an organisation of muscle men given the Orwellian title of "the static security force". Again, it was staffed in the main by their own political supporters. At the same time they were operating in close collaboration with Left-wing shop stewards of the General and Municipal Workers Union, the interests of other trade unionists being swept aside as being of no account.

Armed now with the decisive majority that had eluded them until May of last year, Mr. Hatton and his colleagues announced that there would be no surrender. They said that they would produce a deficit budget, itself an act of blatant illegality, and that the Government would have to accept the consequences. It is still difficult to be absolutely certain of the motives of the leaders of the council. I suppose that some of them believed that once again they would obtain, or at least be able to claim, an easy victory. But when discussing the attitude of mind of a group of Marxist revolutionaries it is difficult to be certain of what their motives may be. No doubt some others hungered for the martyr's crown and others believed that commissioners would arrive in the city, as they did in Clay Cross after that dispute during the Administration of Mr. Heath. Others no doubt believed that there would be some form of violent action in the streets of Liverpool.

And so on to the final confrontation when, despite the slogan, "No cuts in jobs or services", the council sent out dismissal notices to 31,000 of its own employees. By that time schools were short of fuel and the interests of the old and the sick who needed the support of council services were dismissed as of no interest. We also had the point (which I dealt with in the House last week during Question Time) when funds were cut off from voluntary organisations which were working among some of the most deprived citizens of that city.

I turn lastly to the future of both Liverpool and its council. Of course, it is very difficult to predict what is now going to happen. The Labour Party itself is conducting an inquiry and it may be that the district Labour Party, which is controlled by the Militant Tendency, will be dissolved and that various councillors will be thrown out of the Labour Party as well. But that is for the future. It is difficult for us to predict precisely what will happen.

I think that the problems raised by this whole chain of circumstances raise two specific issues. First, there is the situation that will arise in Liverpool when Mr. Hatton and his colleagues no longer govern the city. It is possible that they will cling on to power for some time but, for reasons which are obvious, it would be wrong to speculate what is likely to happen over the next few weeks. What I would say to the Government is that the successors to Mr. Hatton will then face a series of massive problems. Not only will they have the difficulty of getting rid of the Marxist placemen who have been recruited by Mr. Hatton and put on the payroll, but they will also have the formidable task of rebuilding confidence in the city and dealing with the reconstruction of the council's finances which has been made even more difficult as a result of the way in which a loan has been raised with a number of Swiss banking institutions.

All I would say to the Government is that I hope that they will treat the successors to Mr. Hatton, whoever they may be, with some spirit of fairness and generosity; because I believe that that is what will be needed in the very special circumstances arising in Liverpool.

That brings me to the second matter that I want to raise. I believe that Liverpool is a classic illustration of the price that we pay in this country for adversarial politics. So far as that is concerned, it is, I am afraid, in no way unique. An official of NUPE, giving evidence to the Labour Party committee of inquiry, complained about the behaviour of Mr. Hatton and his colleagues in that they appointed a number of officials to the city council on grounds of their political beliefs. I wish that that was the only city in which allegations of that sort are made; but unhappily, as we know, that situation has been faithfully replicated certainly in upwards of 15 or 20 other local authorities in the country.

I think we also have to recognise that in most of these places the majority party on the local authority concerned has nothing approaching majority support in the local community. In Liverpool, for instance, in spite of all Mr. Hatton's strutting pretensions, the fact is that 54 per cent. of the people have voted against Mr. Hatton and his colleagues. In Lambeth—another case of a local authority with an enthusiastic policy of confrontation—Mr. Ted Knight has an absolute majority on the council despite the fact that two out of every three people who voted in the last local elections voted against Mr. Knight. Yet that is the system of voting which is favoured and supported with passion by both the Government and the Opposition Front Benches.

The problems of Liverpool will not await any future change in the system of voting in local government; of course they will not. There are a number of urgent matters which have to be tackled well before that. What I believe is needed in Liverpool is the creation of a climate of collaboration between all sensible people on the city council, whatever their political views may be, in order to rebuild confidence in the city.

That is the first pre-condition of recovery. Without it, I believe that the prospect of atrracting major, new private sector investment is almost non-existent. The second pre-condition will be an imaginative initiative by the Government using, I hope, the resources of the Merseyside Development Corporation and bringing in, I hope, a great number of people from the private sector in the way that Mr. Heseltine attempted to do when he was Secretary of State for the Environment.

Lastly, there will be a need to create an atmosphere of stability. Any prospect, any immediate likelihood, that there is a risk of return of Left-wing extremists to the city council, will snuff out any prospects of recovery. I hope that the damaging period through which the people of this great city have passed will soon be brought to an end and that government and Parliament will do their best to contribute towards its economic and political recovery. My Lords, I beg to move for Papers.

3.10 p.m.

Lord Beloff

My Lords, I think we should all be most grateful to the noble Lord, Lord Harris of Greenwich, for having brought before us a major subject of anxiety, both in respect of the welfare of the citizens of the city we are discussing and in respect of the structure of local government and its finances which have been involved in worsening the situation that there exists.

The case of Liverpool, seen from a distance, is of course not in its origins unique. There are three great port cities on the western side of this island whose fortunes were made in different proportions out of sugar, slaves, tobacco and emigration. Two of them—Bristol, to a considerable degree, and Glasgow, increasingly—it appears have managed to carve out for themselves new spheres of usefulness in the nation's economy and new forms of employment for their citizens. Of the three, Liverpool remains the one most seriously damaged and I have no reason to doubt—it has been said by many people in this Chamber on other occasions—that the noble Lord, Lord Harris of Greenwich, is right when he points to the natural feelings of despair that must affect that community.

If one were to look at the major difference, the major concern that we have, I suppose, it is that whereas the attraction (as indeed the noble Lord said towards the end of his speech) of capital and of employment should throughout have been the first concern of the city fathers, it appears to have been their last concern. Their first concern appears to have been an idea that what was not provided through employment could be provided either by one direct form of employment—that is to say, by the council in public sector housing—or through the provision of various services. And of course the prejudice which they have shown—in the housing sector against housing associations and, in relation to social services, against voluntary bodies—reflects a political commitment. I think it is understandable therefore that a city in this position should have accumulated a very considerable level of public debt; and it is that debt, among other things, which now weighs upon Liverpool and its future.

I think that perhaps the noble Lord, in pursuit of one of his favourite themes, went a little far in suggesting that it has been due to adversarial politics and to the existence of a single party majority; because a good deal of the debt, I believe, was built up by Mr. Hatton's predecessors. I sometimes think that the well-known Liberal leader of Liverpool council, "Jones the Vote", might almost have been styled, "Jones the Note". He has certainly left a burden of debt to which Mr. Hatton has been adding.

When we come to look at the argument, the first point I should like to make to the Minister—and in a sense I think it applies to the Opposition—is this. It has been repeatedly stated by the leaders of the present Liverpool council that their purpose is to secure further funds from central Government, and though by now they have more or less abandoned hope of the present Government they expect that a future Government—a future Labour Government—would look at them with a more favourable eye. I think it has been made plain by the present Government (and I believe also by Mr. John Cunningham on behalf of the Opposition) that this hope is likely to be disappointed and that no Government are likely to have their policy in respect of financial assistance to a particular local authority directed by the fact that that local authority has built up an unbearable burden of debt.

Nevertheless, it is continually repeated by Mr. Hatton and his colleagues that what they are doing is democratic. They continually repeat the phrase that their policies are no more than the policies of the manifesto on which they fought and won council seats in previous elections. I have not seen this answered, and I think it is very important because it may be that the illegitimacy of this kind of conduct is something we must look into.

It should after all be pointed out that in fact democracy, even taking it to a fairly extreme point, might well indicate that the citizens of Liverpool had the right to decide who spent the money that they themselves were paying in the form of rates. It cannot be democratic that the citizens of one city, through their political leaders, should be in a position to tax the rest of the country; because this claim that is made is simply that Liverpool should fix the general rate of taxation in the rest of England, since clearly they cannot be helped unless there is a further degree of public expenditure directed towards themselves. I should like to have some indication of Government thinking in respect of the relations between local democracy and this particular situation.

As we know, and as the noble Lord, Lord Hams of Greenwich, reminded us, the immediate crisis has been postponed for perhaps a year by a fairly large-scale injection of cash in the form of a loan from a number of Swiss banks. It is not, I think, that banks are philanthropic institutions by and large. On the whole they are out, one imagines, for the main chance. Lenin said of capitalists that they would sell the rope by which they were themselves to be hanged—and Lenin spent some part of his life in Zurich. Nevertheless, one assumes that they have taken a cold-blooded view that this is a suitable way in which to invest cash.

One is entitled to ask, because it is germane to our argument: what gives us this confidence? Which of us could go along to a Swiss bank and borrow, not so large a sum but any sum of money, not merely on this very high rate of interest which the people of Liverpool are going to have to pay, without offering some kind of security? What is the security upon which the bankers of Zurich, or wherever else it may be in Switzerland, now rely?

It seems to me improbable that they visualise that the physical assets of the City of Liverpool—its public sector housing, its town hall, its recreation grounds—would be very useful if they were to foreclose upon them. It is possible, of course, that if they could foreclose on the whole city it might he run as well as some Swiss cities are, but that perhaps is Utopia.

The suspicion one has—and this is where I should like to hear the views of the noble Lord the Minister—is that the Swiss banks in question believe that no British Government will allow the actual repudiation of debt by an ancient and famous British city; that is to say that, in spite of the disclaimers by the Secretary of State for the Environment as to any responsibility for these transactions, there is believed to he an implied guarantee of this loan. It seems to me that if that is so it is extremely damaging for this country's credit in the world at large.

We therefore come back to the future and I think few of us would dispute the general prescriptions, at any rate for the immediate future—leaving outside the noble Lord's preference for different electoral arrangements—that he sketched out. But I wonder whether we can altogether rule out the necessity for some kind of action other than the mere substitution of the present Liverpool City Council by the voters of some city council not quite so far steeped in Marxist dogma. It seems to me that the Labour Party's investigation into whether its rules are being properly observed by the Liverpool District Labour Party is really a red herring. It does not go to the root of the very serious situation in which the inhabitants of Liverpool live, and one would have preferred to see the energies of distinguished members of that party's national executive concentrating on something of more immediate relevance to their condition.

It seems to me, and I think it must seem to many other noble Lords, that what cannot be done, even by a future, more friendly, more favourable, more socialistically inclined Government, is simply to put the past behind us and say, "Well, they have more or less come to their senses. We will pour a bit more money into their coffers and see how they get along"; because it is obviously important that if public money is given there should be evidence that public money is properly spent. That may mean that in Liverpool, and possibly in other areas and other districts, to which the noble Lord referred, we shall have to look at something quite different from the traditional assumption that the locally elected councillors can be trusted to do the job.

3.23 p.m.

Lord Dean of Beswick

My Lords, I too am grateful to a certain degree for the fact that this debate has been initiated by the noble Lord, Lord Harris of Greenwich. I have taken note of some of his remarks and also of some of the remarks of the noble Lord, Lord Beloff, in his speech, which preceded mine. But there are a number of factors that ought to be looked at very closely when we talk of what brought about this situation.

I make my premise on the basis that I give no support whatsoever to the action that Militant took in Liverpool, which is completely opposite to my views of what democracy and democratic socialism are about. As a former leader of Manchester council and chairman of its housing committee, I was involved when there was a campaign some years ago totally to ignore the Housing Finance Act and to break the law on that issue. I was one of the persons who was responsible for stopping that idea and the implementation of such policies, and who insisted that we acted within the law. What my own party does about Militant is its business. Its inquiry is under way and I hope that Militant will be dealt with.

But what provided such fertile ground in which Militant could operate? The noble Lord, Lord Beloff, referred briefly to the people who were in control of Liverpool before the present group took control because of the conditions there. I do not propose to go into that in detail, because my colleague and old friend from local government before I came here from Liverpool—I am talking about the noble Lord. Lord Sefton—probably knows more about that in detail than anybody in this Chamber. So I shall not go down that road.

But what I say is that what has happened in Liverpool is the same as what is happening in all our major cities. It is not what Militant has done. It is the conditions that have allowed Militant to fertilise and capitalise on the present situation. I had a Question down as to why we were having this debate, but it is probably opportune, and I know that in the not too distant future we shall be debating the inner cities and what is happening there. Also, I think it is widely known that there is to be a full day's debate in another place on this subject.

But what has brought about the position where people who are much less democratic than I have been able to manipulate the situation? I think noble Lords will agree that I have been most persistent in questioning the Government and Ministers on the financial allocations to the cities and only last week, or the week earlier, the noble Lord the Minister who is to reply to this debate read out a shopping list of Government measures that were designed to assist the inner cities. As I said earlier, I have no time whatsoever for what Militant has been up to in Liverpool, which is the complete opposite of what I believe social democracy to be. But the fact is that, because of a series of measures and because of what Liverpool was left with by its previous administrators, it lost a total last year of £112 million in rate support grant. You can apply that argument to other cities and major conurbations, such as Manchester, Sheffield and the London boroughs.

It is a fact that any assistance that the present Government give in order to deal with inner city deprivation has been more than 10 times lost by the reduction in rate support grant. The constituents or residents of such places have lost in rate support grant 10 times what the Government have ploughed back by other measures. I suggest that that is an absolute recipe for disaster, and it could only provide fertile ground for what we have seen happening in Liverpool.

Since his arrival in this Chamber, we have heard my old first Chief Whip, the noble Lord, Lord Mellish, talking about what has been achieved in dockland. Anybody who has had time to read the report of the most reverend Primate the Archbishop of Canterbury on the inner cities will know that at present there are only two urban development areas. One is the east docklands of London, about which reference has been made by the noble Lord, Lord Mellish. I pay tribute to the wonderful job he has done. The other is Merseyside in a general sense. I must tell noble Lords that if some of the other major cities had not had financial resources taken away from them to provide financial assistance for the London docklands and the Urban Development Association, we may not have been having this debate today.

At the end of the war, Liverpool had a population of three-quarters of a million. Manchester had a population of three-quarters of a million, too. Since then—and this has been conveyed in the succession of reports that are coming through—deprivation has occurred. Liverpool and Manchester have each exported into the hinterlands outside their cities a quarter of a million people.

Lord Mellish

My Lords, the noble Lord has mentioned my name and the docklands corporation. The allegation is that if this money had been given to local authorities they would have done just as well, if not better. That is how I heard it.

Lord Dean of Beswick

No, my Lords.

Lord Mellish

My Lords, I want to put it on the record that they did in fact have a docklands joint committee, but they did not do anything about it. That consisted only of the boroughs.

Lord Dean of Beswick

My Lords, with all due respect to the noble Lord, Lord Mellish, we are not talking about the same thing. The noble Lord is talking about a conglomerate of London authorities which could stand to be criticised. I am talking about a series of big cities which stood on their own. Manchester and Liverpool, under historical control—and before Militant took control—had to export a quarter of a million people—mainly outside their borders. They received nothing like the financial assistance that was afforded to the Docklands Development Corporation, to the Urban Development Association or to the new fetish which came in—the new towns.

When the present Government came in they quite deliberately shifted rate support grant from the big cities, which are not their voting areas, to the rural counties, which are. This is all recorded in the debates in another place. That load had been carried on the backs of the ratepayers in Liverpool, Birmingham, Manchester and the London boroughs. That is why some of their rate poundages have escalated so much. It is because of the disgraceful withdrawal of rate support grant from those deprived areas that rate poundages are so high. As I said to the Minister who is to reply to this debate, it is time that the Government got shot of their crocodile tears over the inner cities, because what has happened over the past five or six years can be laid very much at their door.

I opened on the basis that I am totally opposed to what Militant has tried to do in Liverpool. I go back to the days of Herbert Morrison who, with pioneers in the Labour Party, spent a long time convincing people that we had people in the Labour Party who could take responsibility for running the big cities and conurbations of this country with distinction and without any suggestion of corruption or non-sensible behaviour. If I have to charge Militant with anything it is that it has actually destroyed the reputation that was built by people who led Labour authorities, such as Liverpool historically, Manchester, Sheffield, Birmingham and the London boroughs. Those records are second to none. That is one of the gravest charges I make against it.

I go back to the city that I was privileged to lead for a time—I shall not say with distinction, but I think that I perhaps did it rather well. I think that if you are not prepared for a little self-praise you have no right to be in the business of politics. I pay tribute to my predecessor, Sir Robert Thomas, who was the founder chairman of the AMA and whose record stands comparison with that of any man in local government I have met. He would have been appalled by the kind of behaviour from this group of people in Liverpool.

I know I am nearing the end of my time, and so I must tell noble Lords that I took the trouble to read assiduously an eyeball to eyeball confrontation reported in the Manchester Evening News between the present leader of Manchester City Council and its political lobbyist, who works here. By leave, I quote, and this comes from the present leader of the Labour council in Manchester: We haven't solved our problem. We are coming through this year because we have used a lot of our reserves, which Liverpool didn't have …because the financial restrictions the Government has imposed are the same for Manchester as for Liverpool …eventually we'll get into a very difficult situation". I must say before I close—I hope my advice is heeded—that what Militant has tried to do in Liverpool is a recipe for disaster for anybody else thinking of the same course. I think that Manchester is moving towards a Liverpool situation. It would be impudent for me to tell Manchester what to do. The present leaders in Manchester have made a lot of decisions that neither I nor the people who were in control of the Labour Party when I was there would have made. If they have any idea of going down the East Lancashire road towards Liverpool and of pursuing the same policies, the only people who will be hurt are the ratepayers of Manchester, the elderly, young people and my party. I say to them: forget it and get on with governing the city with some credibility to yourselves and to the party you are supposed to espouse.

Having said that, I repeat that the Government have a lot to anwer for. When I look at the financial resources that have been withdrawn from the major cities, I say that the Government should be ashamed of themselves.

3.38 p.m.

Lord Crawshaw of Aintree

My Lords, what we are debating today is nothing more or less than the hijacking of a party and of a city. Some people have gone back as far as the last administration in Liverpool. We will never understand the problem unless we understand why Liverpool was chosen for this particular takeover for the destruction of society as we know it—because that in fact is what it is all about. To do that, I go back not 10, 20 or even 30 years—I go back to the late 1940s, when I first became involved in politics in Liverpool.

I want to say this first of all. Reference has been made to how people have lived in Liverpool recently. The hardships and deprivations that they have experienced are nothing new. Liverpool helped to make this country great. It helped to make it a financial centre of the world, with its ports sending ships and exports to every place on the globe. It gave its men in two world wars and kept open the lifelines of this country, and, apart from London, suffered possibly the most severe bombardment of any city. Yes, you can go to the docks near the pierhead in Liverpool and you will see where the money went to. There are lovely buildings there. It is a wonderful city. But there is one thing that has never happened in Liverpool in any of those generations—the people who did the work never shared in that wealth.

Because time is limited, I shall have to telescope what I was going to say. If one goes back to 1846, because of the deprivation in Liverpool the first medical officer of health to be appointed in this country was appointed in Liverpool. What did he find? He found that half of the working people in Liverpool were living in what were called courts: houses back-to-hack and sometimes made into a square, in the centre of which was possibly one toilet, together with one water pipe, for all the families living in those houses.

When I became a councillor in Toxteth in 1957, I knew that 85,000 houses had been deemed unfit for habitation. I knew that the situation there was bad but I did not expect to find people living in such poor conditions. Squares and courts still existed. In 1846, there were 40,000 people living in 8,000 cellars. When I speak about cellars, I mean cellars with earth floors, not wooden floors. People were still living in cellars in 1957 when I became a councillor in Liverpool. In the past, an attempt was made to rectify that situation by introducing legislation that stipulated a certain amount of headroom for people living in cellars. What did the people who owned those properties do? They did not condemn them but dug the cellars another two or three feet below the fanlight that was let into the side of the road. Liverpool has never shared in prosperity. All too often it has given its all to this country but it has never shared in the benefits.

However, that is not the reason the events in Liverpool today have happened, but it is the reason the people who seek to destroy society, our country and all those things that we hold dear, have chosen Liverpool. Although what I believe is merely surmised from people who came to Liverpool, my belief is that the Workers Revolutionary Party realised that the only way it would ever get control was by infiltrating the Labour movement in two spheres. The first was the shop floor, and from there into the trade union movement. The second was into the constituencies. That is what it set about doing.

In the early 1950s, I was membership secretary for two different wards in the Walton constituency at two different times. I was amazed to find people coming from all parts of the country into Liverpool, living in lodging houses and transferring into the Labour Party. When I went to see them, I found that one thing they had in common was that they wanted not merely to get a job in Liverpool but a job in a particular factory in Liverpool. That is what they had been sent there to do. There was nothing that the factories had in common then. The only thing they have in common now is that they have all ceased to exist. That is what has happened in Liverpool. That has been going on for year after year for 35 years that I know of. For the first 20 years I was telling what is now the Opposition about that situation, and the Labour Party instigated inquiries. People were sent up there to look into the situation.

What happened to the inquiry that took place in 1981, when the SDP was formed because of what was happening in the Labour Party in Liverpool? Did we ever receive a report about that? Shall we receive a better report on the inquiry that is taking place in Liverpool now, or shall we see a whitewash? I have said for many years that I admire the dedication of the people concerned, who have for years and years suffered hardships in order to propagate their policy of the destruction of our society. I only wish that some of the political parties and some of the Churches had that same dedication.

Those people deceived me. Although they were seeking to destroy society, I never thought that they would seek to destroy their fellow working men. Although I have given them credit for their dedication, I found out only last year that they are evil people. It is only evil people who will divide an ethnic community by appointing a race relations officer from a housing department who knows nothing about race relations. It required ineptness as well to unite those two different sections of the ethnic minorities against the Labour Party in Liverpool.

It is evil people who, when there is no oil in the schools because they cannot afford to pay the bills, can find £10,000 to pay off the bailiffs so that they can get back their four limousines and ride round Liverpool in them. They used those same limousines to transport all the literature that they gave out at the Labour Party Conference in October. It is evil people who, when gardeners at a particular park refused to go out on a one-day strike, closed down the centre in question. Professional gardeners are now picking weeds and sweeping pavements. There are many evil people in Liverpool now, and they have been exposed.

It is circumstances which breed those evil people. Liverpool was chosen because of the deprivation that was there. No society can ever live in peace and security while one or two aspects of that society are facing such deprivation. I have been appalled at the criticisms that have been levelled against the bishops for their recent report. I was speaking to a bishop at the weekend. He was not the bishop who sat on the commission. He said, "If I give all my money to help the poor in Africa, then I am considered a saint. But if I tell others about the plight of the people in Africa, then I am considered a Marxist".

The Government have to make a decision. When Members of your Lordships' House or people anywhere else start telling the country what is wrong in our society and why riots and other things are happening, they should not have language of the kind we have heard used against them. The right reverend Prelate the Bishop of Liverpool and his counterpart, the Archbishop of Liverpool, have done more to bring the Churches together than any other people I have ever known. When I went to Toxteth 30 years ago, riots took place on the streets every 12th July between the Catholics and the Protestants. Now they have a service in one cathedral and walk to the other cathedral. That is correct. That is what happens in Liverpool. If people like them were looking after the situation in Northern Ireland, we might find a better solution there, instead of seeing them being criticised.

How did those evil people in Liverpool win control? First I pay tribute to my noble friend—and I call him my noble friend because he always has been—Lord Sefton of Garston, who in my view was one of the best leaders of any city council. I say that without fear of contradiction. If the memory of anybody goes back further than mine in respect of Liverpool, then his does. What happened to all the industries which his hard work and his council's work brought to Liverpool? We were swamped with factories. Your Lordships may have seen Michael Edwardes speaking on television the other night, when he was asked why the Leyland factory had closed. He answered that of all the factories they had, Liverpool had the worst record for disputes and everything else. That is what has happened in every factory in Liverpool, because dedicated people went there with the sole purpose of destroying our economy, not saving it. That is what Liverpool has been fighting against.

I say here and now that no one should write off Liverpool and the people of Liverpool. There are many people in Liverpool who have worked their whole lives there and who have never known what it is to spend a day on strike. Your Lordships will know about the Liverpudlian sense of humour. Indeed, we say up there that one must have a sense of humour to live in Liverpool. Liverpudlians are dedicated people. If anything, they have a misplaced sense of loyalty. One sees that in their football, and one sees it among their politicians; their team, right or wrong, and their mates in the trade union movement, right or wrong. And evil people have been there to lead them by the nose. I can think of at least a dozen factories which my noble friend Lord Sefton helped to bring to Liverpool but which are no longer there.

Those evil people have also gained control in the constituency parties. In the 1955 election, a number of us had to band together in order to stop the nomination of a particular candidate, the Labour candidate for Walton. Your Lordships will notice that I never mention names. I have been in politics long enough to know that if you cannot say anything good about anybody, do not say anything bad if you mention the name; and never mention anyone's name who is likely to be a candidate against you.

Did any of your Lordships see the article by the political editor of Militant in The Times on 21st November headed: It's Kinnock out of step"? That is the person who was prevented from becoming the Labour candidate for Liverpool, Walton, in 1955–30 years ago this year. People talk as though this has suddenly come out of the woodwork in the last few years. It has been there festering.

I must make a criticism here. I regret what has happened in the Labour Party because the people in the Labour Party, who I hope we also represent, must have a voice in these Houses. They must have a voice, but because it was more expedient to cover up and to sweep under the carpet, this has been allowed to happen. Yes, there has been a great light flying—not Halley's Comet, but the light seen on the Damascus Road. There have been no end of people on the Damascus Road these past few weeks. In fact, the leader of the Liverpool City Council has been struck by that very light. Yes, he is the leader. Your Lordships might have thought he is only the deputy leader. But he has been twice blessed. He has been given the gift of tongues. He is now speaking. If half of what he says is correct, charges ought to be brought against the militants for keeping him incommunicado, for refusing to let him speak to people over the past two years. What is his excuse?—"I did it because I thought I was the great white hope of all the moderates." What crimes are committed in that name, not only there but in these Houses? Such people think they are God's gift to humanity. If it means saying that black is white in order to stay and protect the people they represent, they do it. In my parlance that comes under the term of "hypocrisy".

I regret that I must say this. We have been told that there is a maggot in the body of the Labour Party. It has been pointed out that maggots are generally found in dead bodies. The Labour Party is alive—very much alive. I regret to say that although the body is alive, it is not the body that Hugh Gaitskell meant when he said, "I will fight and fight to save the party I love". That did not come when people were lying on the floor, like the miners' leaders, or when Liverpool was being defeated by the other councils who refused to support it. That call came when his adversaries were at their greatest strength. That is what I call moral courage. Anything else I call hypocrisy.

Back to