Lords Sitting of 1 May 1985

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR On the Woolsack.
Prayers—Read by the Lord Bishop of Southwark.

Community Radio
Lord Aylestone: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they propose to introduce community radio into the United Kingdom before the Peacock Committee have reported on the future of broadcasting which is to be wholly or partly financed from advertising revenue.
The Parliamentary Under-Secretary of State, Home Office (Lord Glenarthur): My Lords, we are anxious to provide an early opportunity for the development of community radio, perhaps starting with some experimental stations. But a range of matters, including the means by which it might be financed, must be considered in our study of how the development of community radio can best be taken forward. We hope to make a further statement before long.
Lord Aylestone: My Lords, I thank the Minister for that Answer. In view of the terms of reference of the Peacock Committee, is it not a little unwise to commence yet another system of radio financed by advertising revenue before the committee report—especially in view of the fact that yet another local radio station has failed this week?
Lord Glenarthur: My Lords, I do not believe that the existence of the committee to which the noble Lord refers need preclude our setting up, for example, some experimental community radio stations. I can certainly assure the noble Lord that there is no question of the Government setting up a whole network of community stations in the time scale of the Peacock Committee.
Lord Mishcon: My Lords, does the noble Lord remember the Written Answer that was given by his right honourable and learned friend the Secretary of State in another place when he then said that he hoped to be making a further statement before too long and eulogised the idea of community radio as one that would,
"promote self-help, increase freedom of speech, and be of value to many local communities"?—[Official Report, Commons, 23/1/85; col. 417.]
Does the noble Lord the Minister still adhere to that point of view? If the Government are not waiting for Peacock, then what are they waiting for?
Finally, is the Minister saying that even in the experiments advertising may take place before
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Peacock recommends as to whether advertising is a good influence in affecting the quality of radio?
Lord Glenarthur: My Lords, as I said in my original Answer, my right honourable friend will be making a statement before long. I do not believe that the existence of the Peacock Committee need inhibit us from setting up some experimental community radio stations in the meantime, if we decide that that is a sensible approach. The noble Lord will have to await my right honourable friend's comments.
Lord Mishcon: My Lords, I am sorry to press the Minister, who is always very patient, but he has not answered the question I put to him. Will the experiments which are to take place lead to advertising being permitted even before Peacock recommends as to whether the insertion of advertising revenue and the carrying of advertisements on radio stations' programmes will affect standards?
Lord Glenarthur: My Lords, I take the noble Lord's point. I cannot go any further at this moment other than to say that the experimental services need not necessarily affect the outcome of the further programme—if my right honourable friend goes ahead with it. The noble Lord will have to await the statement.
Baroness Stedman: My Lords, will the noble Lord give the House an assurance that the Peacock Committee will also examine the high cost structure of independent local radio? If more advertising is to be allowed on the wavebands, this will lead to many more failures in independent local radio, unless their cost structure is amended considerably.
Lord Glenarthur: My Lords, that is just the kind of issue which I referred to in my original Answer.

Women Science Undergraduates
2.41 p.m.
Lord Gainford: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether there has been an increase in undergraduate women reading scientific subjects, including engineering, in the last five years and, if so, what they are doing to encourage the trend to continue.
The Earl of Swinton: My Lords, there has been a consistent increase in the relative and absolute number of women engineering and science undergraduates over the last five years for which figures are available. The Government are anxious to maintain this trend and have taken substantial steps to do so through measures encouraging girls to take up science in schools and to increase significantly the number of places available in engineering and scientific subjects in higher education institutions. Further progress depends also, however, on changing the existing preconceptions and attitudes of girls and their parents.
Lord Gainford: My Lords, I thank my noble friend the Minister for that Answer. Has he any information as to the success which the Equal Opportunities and Manpower Services Commissions have had in encouraging women to take up these careers and therefore in giving them more motive for applying for university places to study relevant subjects?
The Earl of Swinton: Yes, my Lords. Among other things, the Equal Opportunities Commission and the Engineering Council showed much initiative in designating 1984 as Women into Science and Engineering Year. This provided a welcome opportunity to increase awareness and to encourage girls to consider pursuing science and engineering subjects. Also, the technical and vocational education initiative and the micro-electronics education programme aim to provide equal opportunities for girls and avoid sex stereotyping.
Lord Grimond: My Lords, would the noble Earl the Minister agree that, as has been indicated by the noble Lord who asked this Question, this is not only a matter of what universities do but also of the chances for women in the post-university, adult world dominated by men? Does the noble Earl not agree that, on the whole, women are much better than men as drivers of cars and engines, and much more skilled in operating many machines? Will the noble Earl do his best to break down the violent male prejudice against women in the many occupations in which they actually excel men?
The Earl of Swinton: My Lords, the noble Lord is perhaps already embarking upon the first debate this afternoon. I agree with him that, certainly so far as some of the new information technologies are concerned, women are much more suited to, and better at, these high technology jobs. The Government are trying to get that message across.
Baroness Phillips: My Lords, does the Minister agree that there is a great need for the encouragement of more teachers of science in schools, particularly in girls' schools?
The Earl of Swinton: Yes, my Lords; and better taught teachers, as well.
Lord Beloff: My Lords, does the noble Earl the Minister not agree, following the last supplementary question, that it is essential that schools bring girls to the point at which they can profit from university and polytechnic education in these subjects? Will he also agree that the figures supplied to me by his department, through his courtesy, show clearly that girls from girls' schools do more than twice as well at these subjects as girls from mixed schools? Should we not draw some lessons from that?
The Earl of Swinton: Yes, my Lords. To answer my noble friend's second point first, there were a number of other factors which I tried to point out in that letter, and other things which come into play. I agree that action to increase the number of women undergraduates must begin in schools. Before we can increase the number of girls taking science A-levels we
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must increase the number of girls studying science up to the age of 16. The Government have recently published a policy statement on science from 5 to 16 years in which it is proposed that all pupils, including all girls, should be properly introduced to science in the primary schools and should continue a broad study of science throughout the first five years of secondary education.
Lord Davies of Leek: My Lords, will the noble Earl please tell me how all this otiose talk will end up producing better and improved education when schools have suffered cuts of millions of pounds in materials imposed by the party now in power?
The Earl of Swinton: My Lords, I think that is a very different question.
Lord Hankey: My Lords, will the Minister inform the House whether the interesting views he has expressed are accepted by the Engineering Council, which is making such progress in reorganising the engineering profession?
The Earl of Swinton: My Lords, I imagine that very much they are. That is why, as I said in answer to the first supplementary question, the Engineering Council was very much a party to Women into Science and Engineering Year; and it is hoped to change these attitudes.
Baroness David: My Lords, can the Minster tell me how well women are represented in part-time engineering and technical courses at polytechnics and universities? Part-time courses are sometimes very much easier for women to attend. Are the Government going to encourage more part-time courses?
The Earl of Swinton: My Lords, I am afraid I do not have any figures available. I will write to the noble Baroness on that point.
Lord Hatch of Lusby: My Lords, is the noble Earl aware that Mr. Gavin Laird, of the engineering union, said in public before the Select Committee on Overseas Trade that his union is very anxious to increase the number of women in engineering and is doing all it can deliberately to bring women into the industry?
The Earl of Swinton: My Lords, I was not aware of that, but I am delighted to hear it.
Lady Saltoun of Abernethy: My Lords, can the noble Earl give some assurance that girls will not be pressurised into reading scientific subjects when they have no wish to do so? A great many have not.
The Earl of Swinton: My Lords, I find it very difficult to pressurise members of the opposite sex into doing anything unless they are themselves absolutely determined to do it.

Maritime Policy
2.47 p.m.
Lord Kennet: My Lords, I beg leave to ask the first Question standing in my name in the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the co-ordination of maritime policy is among the responsibilities of the Secretary of State for Transport, and if so why, in his answer to the Commons on 29th March (cols. 383–386) he makes no reference to maritime affairs.
Lord Brabazon of Tara: My Lords, my right honourable friend does indeed take the lead in coordinating the Government's maritime policies. In his Answer to the Question from the honourable Member for Rugby and Kenilworth on 29th March my right honourable friend made an extensive reference to the action which the Government have taken in pursuing their shipping policy. The necessary constraints on the length of his Answer did not permit him to detail more of the work that the department has undertaken in this and other related areas.
Lord Kennet: My Lords, was not that extensive reference in practice confined to the Government's action in privatising one or two shipping interests or enterprises? Does the noble Lord consider that, even if it had covered the whole shipping industry, it would be sufficient evidence of the Secretary of State's activity of co-ordinating maritime policy of all sorts? Was it not an extremely lengthy Written Answer, giving a full panorama of a year's activity? Did it contain the word "co-ordination"? I believe not.
Lord Brabazon of Tara: My Lords, my right honourable friend's Answer certainly did not restrict itself only to privatisation. I refer the noble Lord to the Answer in col. 384 of 29th March 1985. I do not wish to waste the time of your Lordships by reading it out, but basically it gives a summary of what we have done in the world shipping markets to open them to competition, and so on. In fact, it does not mention privatisation as such.
Lord Shinwell: My Lords, is it not possible that the Minister's right honourable friend the Secretary of State for Transport made no reference to maritime affairs because the Government have no policy on maritime matters? This is a very serious situation because in terms of the possibility—I would not put it higher than a possibility—that we might be faced at some time with aggression we will find that, in lacking an effective and adequate maritime policy, we will not have the faintest chance of gaining a victory.
Lord Brabazon of Tara: My Lords, it is quite wrong to say that my right honourable friend did not mention the maritime policy in his written reply to which I have just referred. Perhaps I may recap on what he said. The main aims of our policy are to secure the widest and fairest world-wide market for British shipping to compete in, to fight protectionism, subsidy, noncommercial competition and unsafe vessels in international and cabotage trades and to reduce the burden of external costs and marine regulations.
Lord Kennet: My Lords, will the noble Lord now answer the Question, which referred to, "the co-ordination of maritime policy"? Can he name a single action taken by his right honourable friend to coordinate the policy towards maritime affairs of the other 13 Government departments which it is his duty to co-ordinate?
Lord Brabazon of Tara: My Lords, co-ordination can and does take place and the problems are not of Government machinery but of international economic pressures and distortion of shipping and shipbuilding markets. With regard to naming any specific act of co-ordination, I could mention the control of pollution, for instance, where we operate very closely with the relevant department there.
Lord Paget of Northampton: My Lords, is the noble Lord's reluctance to answer this Question caused in part at least by the progressive absence of the Blue Ensign from the oceans? They are getting fewer and fewer.
Lord Brabazon of Tara: My Lords, with regard to the Blue Ensign, in fact I think most of our merchant shipping flies the Red Ensign. The reasons for the decline in the fleet I hope I covered in answer to a Question asked by the noble Lord, Lord Grimond, in January of this year. There are many different reasons for that, notably a change in patterns of trade and very competitive rates in the bulk trades, particularly the wet bulk trade.

Strategic Defence Initiative and Europe
2.52 p.m.
Lord Kennet: My Lords, I beg leave to ask the second Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what conclusions were reached at the meeting of WEU Defence and Foreign Ministers on 22nd April about the invitation from the USA to join in research under their strategic defence initiative.
The Minister of State, Foreign and Commonwealth Office (Baroness Young): My Lords, the conclusions of the Bonn Meeting of WEU Foreign and Defence Ministers on 22nd and 23rd April are summarised in the communique, a copy of which is being placed in the Library of the House.
Lord Kennet: My Lords, first can the noble Baroness confirm to this House that that ministerial meeting adopted the Reagan-Thatcher four points as a basis for a joint response to the United States invitation to take part in research into ballistic missile defence? Secondly, can she tell us what NATO arrangements are being made to get on with finding the answers to the most pertinent questions asked by the Foreign Secretary in his important speech of 10th March?
Baroness Young: My Lords, in answer to the noble Lord's first supplementary question, the United

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Kingdom position remains as set out in the four points agreed by my right honourable friend the Prime Minister and President Reagan at Camp David in December. On the communique itself, it makes it clear that Ministers agreed to continue their collective consideration of the United States invitation to participate in the SDI research programme in order to achieve as far as possible a co-ordinated reaction to it. But they underline the importance in that context of continuing bilateral consultations with their partners in the Atlantic Alliance.
Lord Molloy: My Lords, many of the leaders of NATO countries have supported the superb comments of the British Foreign Secretary in his detailed analysis of star wars. He warned and encouraged us at one and the same time that we should be very careful to see that this research would in no way be dangerous. Does the noble Baroness agree that if we could find a system to verify disarmament, that would be much to be preferred for the security of mankind to any system of star wars?
Baroness Young: My Lords, the WEU, the subject of the Question, is a useful forum for an exchange of views, and it is helpful for us to hear the views of our European partners. But the major forum for substantive discussion and consultation on security issues must remain the Alliance.
Lord Cledwyn of Penrhos: My Lords, following the Camp David four points of agreement, can the noble Baroness say whether there have been further consultations between Her Majesty's Government and the United States Administration on this question? Further, does she agree that that matter is of focal importance and will continue to be so over the next 10 or 20 years?
Baroness Young: My Lords, I understand the point that the noble Lord is making about the importance of this. As he will know, we understand, too, the urgency with which the Americans wish the allies to respond to their invitation on research. But as they have now made clear, there is no longer a 60-day ultimatum.
Lord Mayhew: My Lords, do we understand from the first Answer of the noble Baroness that the European Governments are continuing to try to reach a collective view on the strategic defence initiative and that when they do so it will be published?
Baroness Young: My Lords, it is too early to say what co-ordination of European reactions to this may be possible. The WEU members first need to develop a dialogue with the United States in order to establish a factual basis on which participation in the research programme might be possible. Then there can be discussion among the European countries to see how co-ordination might be developed. The noble Lord would not expect me to comment on his last point which is a hypothetical question.

Business
2.55 p.m.
Lord Denham: My Lords, it may be for the convenience of your Lordships if I say a word at this point about the arrangements for this afternoon's short debates standing in the names of the noble Baroness, Lady Lockwood, and the noble Lord, Lord John-Mackie. It is customary in short debates for the mover to be allowed approximately 15 minutes and for the Minister to rise to reply not less than 20 minutes before the scheduled end of the debate. In both of this afternoon's short debates that means that all other speakers should be subject to a maximum of 10 minutes. If any noble Lord were to speak at greater length, it would be at the expense of subsequent speakers in that debate.

Coal Industry Nationalisation (Amendment) Bill [H.L.]
Lord Harris of High Cross: My Lords, I beg to introduce a Bill to amend Section 1 of the Coal Industry Nationalisation Act 1946 so as to remove the National Coal Board's monopoly in colliery activities. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Harris of High Cross.)
On Question, Bill read a first time, and to be printed.

Women in Public Life
2.57 p.m.
Baroness Lockwood Baroness Lockwood rose to call attention to the position of women in economic and social affairs in public life; and to move for Papers.
The noble Baroness said: My Lords, it is now some 10 years since the Sex Discrimination Act was passed. In that time considerable progress has been made towards eliminating discrimination on grounds of sex and towards providing greater opportunities between the sexes, largely under the guidance of the Equal Opportunities Commission. I hope that later in the debate the noble Baroness, Lady Platt, will be able to tell us of some of the actions of the Equal Opportunities Commission. But today I want to draw attention to the implications of our legislation and administrative structures in looking at the position of women in economic and social affairs and in public life.
Although comprehensive in its scope, the Sex Discrimination Act was so framed as deliberately to exclude from its provisions certain areas of vital importance to the progress towards equality. I am not complaining about that. Obviously one single Act of Parliament could not sensibly amend a whole range of legislation containing important financial implications, such as social security and taxation laws. But those areas of legislation were an essential element in the social and economic infrastructure within which progress towards equality was to take place. They embodied many of the symptoms of society that were the major obstacles to equality: for example, the principle of married women's economic and social dependency on their husbands.
Of course there has been some progress in this respect, but there have also been some retrograde steps. The concept of dependency was apparent not only in legislation but also in other spheres, not least in the employment field, to which I should now like to turn. Despite the growing level of unemployment, the steady growth of women in employment has continued. Today, women represent 43 per cent. of the labour market. The growth in married women's economic activity has been particularly significant, rising from a rate of 20 per cent. in 1951 to 50 per cent. in 1981. However, there are enormous differences between women's position in employment and men's. This is illustrated by the average hourly earnings for women which are still only 74 per cent. of men's average hourly earnings, having risen from 63 per cent. in 1970.
Two factors contribute largely to this difference. The first is the segregation of the sexes in areas of employment. Women are to be found preponderantly among the low paid workers, both in low-paid industries and in low-paid occupations. The Low Pay Unit defines low pay as two-thirds of average earnings, and women make up 5·7 million of the 8·3 million low paid workers in the country—even in the professions. For example, we learn from a report published over the weekend that women teachers' average salary is £700 less than the average salary of their male counterparts. The 1980 Department of Employment/OPCS Women and Employment survey found that almost two-thirds of women were in jobs done only by women at their workplace, many of them being part-time workers.
The significance of this is that up to January of this year no comparison with a man could be made under the Equal Pay Act. However, since the amendment to the Equal Pay Act to include the definition of "work of equal value" it should be possible to test whether or not such women are being paid a fair return for their labour—as, for example, the women machinists at Fords in Dagenham. We had a report on that matter only last week.
The second and absolutely fundamental contributory factor to women's low earnings is the break they have in their working lives for child rearing and the fact that they usually re-enter the labour market on a part-time basis. This has an enormous effect not only on their immediate earnings but also on their long-term prospects.
Forty-three per cent of all women who work do so part time. Incidentally, 3·6 million of the part-time workers are included among the low paid. What are the implications of this? First, many women are employed in areas covered by the wages council; and, as many of the part-time workers are not unionised, they are among the most vulnerable workers in the country. Perhaps the Government will take note of this in their consideration of the future of the wages councils. Secondly, the pressure to bring down wages, particularly in the service sector, which is the area where most of the jobs are being created, largely on a part-time basis, is likely to affect women most.
I acknowledge the need for many women to work part time while their families are young and I encourage every facility for them to do so. However, I
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object to women who have to work part time being forced into low paid jobs and very often into jobs below their qualification level. There is a need for much more thought and managerial skill to be deployed into structuring part-time work for parents who need it, right across the whole range of occupations. That is so that they can continue in their normal occupations on a part-time basis but remain in line for training, promotion and pension contributions, as advocated by the EOC and as is being done by many of the enlightened employers, including the Civil Service.
However, I must say that I have some sympathy with those industrialists who have recently pointed out that we cannot sustain a prosperous economy based on a service sector unless there is an efficient and dynamic manufacturing industry on which to base it. Thus I support again the activities of the Equal Opportunities Commission and others in encouraging more women to train for the new technological areas and for a wider range of occupations.
A prosperous manufacturing industry should provide the base for a prosperous service sector, capable of paying reasonable wages for both women and men, with part-time workers enjoying the same opportunities as full-time workers. Again, this is something that they cannot do at the present time. It would seem that efforts to bring part-time workers into line with the rights of full-time workers through a European directive is being blocked by the United Kingdom.
While recording these facts, it is equally important to record that women's pay makes a very essential contribution to family budgets. The supplementary Benefits Commission, away back in 1974, calculated that three times as many families would be living below the poverty line were it not for the wives' earnings. In 1978 a DHSS publication indicated that working wives' contributions average 25 per cent. of family income. In the poorest families this rises to 30 per cent. The proportion of wives earning the same as or more than their husbands is steadily increasing. There are now also a substantial number of women who are heads of households, including 90 per cent of all single-parent families.
Thus women's economic contribution to both the family and the nation is very significant, but it is not yet fully recognised in either the infrastructure of the social security system or in the labour market. In the area of social security, there is direct discrimination against married women in the provision of invalid care allowance. Single women, single men and married men all qualify for this benefit if they are caring for an invalid. Married women do not, even if they give up a job in order to do so, the principle being the outdated assumption that a married woman is financially dependent on her husband.
This outmoded assumption of dependency is also still with us in taxation laws, because under the taxation laws a married woman's position is not recognised at all. Her income for income tax purposes is deemed to be her husband's. This is an anomaly in 1985. Similarly, by the nature of the work they do, fewer women than men are included in occupational pension schemes. Those who are included are far less

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likely than men to be able to provide a survivor's benefit. That could be regarded as discrimination against men, and it is; but again it contains the same dependency principle.
In provision for the unemployed, a new indirect discrimination against married women has been introduced through the community programme. This takes the form of excluding those who do not qualify for certain benefits from being eligible for a place on the community programme. According to official statistics, the women's unemployment rate is lower than men's, but there are a substantial number of women who do not qualify for a benefit and who are therefore not shown as registered unemployed. There are also a substantial number of women with children who would like to return to the labour market if jobs were available. Both these groups are ineligible for the community programme and officially they do not exist as unemployed. These are all examples of our failure to recognise in our laws and in our structures the hard fact of women's economic activity outside the home.
The failure to recognise this or the turning of a blind eye to it also leads us to ignore the needs of parents—and I mean both parents. When husband and wife are at work, both need facilities for the care of their children. We must be at the bottom of the European league in nursery and nursery school provision. As we heard in a recent debate in this House, the Government are dragging their feet on the proposed European directive on parental leave.
This is a far less favourable report than I would have hoped to have given 10 years after the passing of the Sex Discrimination Act. And the story does not end here; it extends into the field of women's participation in public life. Monitoring by the Government's Management and Personnel Office indicates that, of all appointments to public bodies, women represented 17·4 per cent. of the total in 1983. The Equal Opportunities Commission report Women and Public Appointments ascribes this largely to the "old boy" network. The report points to the sources of consultation and nomination for these appointments both within outside institutions and internally. By and large, those consulted are male-dominated bodies—the CBI, the TUC, professional institutions, the senior Civil Service and Ministers. Put another way, the appointments reflect women's low levels within industry and the professions and their invisibility in some of our governmental and state provisions.
In due time, as more women move up the scale through the assistance of the Sex Discrimination Act and the policies of the EOC, this could change. But we cannot afford to wait for that slow process. As in all other areas—new technology, management, etc.—we cannot afford to ignore half our human resources. So the network as well as the qualifications being sought must be widened. For instance, in this House I have heard it said that children are better cared for if their mother is at home. I am neither assenting to nor dissenting from that statement at the moment. I wonder, however, how many of those same people would think it appropriate to appoint to a public body a woman with little experience of being other than a housewife and mother. I know that when I have made nominations of such women I have been asked: "But
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what qualifications has she?" We cannot have it all ways. I would say that when similar women have become elected to local authorities (again, all too few of them) or when similar women have been appointed as magistrates, where there are some requirements to have women and where training is a condition of the appointment, these women have shown their capacity and ability to carry out the work as well as anyone.
We need a new perspective on the whole position of women in society, and in particular on their position in economic and social affairs and in public life. I beg to move for Papers.
3.15 p.m.
Baroness Gardner of Parkes: My Lords, I am grateful to the noble Baroness, Lady Lockwood, for bringing this debate to the House today. I have a particular interest in speaking on the subject as I am the United Kingdom representative to the United Nations Status of Women Commission. In that capacity, I see much of the situation, how things are for women in this country and how their position compares with that of women in the world in general. Whatever problems we have here, we have to realise that they are as nothing compared to the problems of many women in the developing countries.
This year marks the end of the Decade for Women. In 1975, International Women's Year was declared and a conference held in Mexico City. The World Plan of Action came out of that with, as its themes, equality, development and peace. In 1980, the mid-decade conference was held in Copenhagen and the sub-themes of employment, health and education added—issues that perhaps mean more to women in the Western countries. Then we had the Convention on the Elimination of all Forms of Discrimination Against Women, signed by the United Kingdom in 1981. Many years have gone by. During that time the women of this country have written regularly to their representatives to ask when Britain expects to ratify. At the time of signing—we were rather slow to sign—we said that we only signed conventions when we were fairly confident that we would be able to ratify in due course. Of course, ratification takes a considerable time as we have to consult our islands and dependent territories—quite a lengthy process.
Since my appointment as United Kingdom representative some three to four years ago, I have had an almost non-stop flow of letters from individual women and from NGOs—non-governmental organisations—asking when they will see ratification by the United Kingdom. I hope that this will be declared by the Government before the world conference in Nairobi in July. If not, there will be a considerable degree of embarrassment for the United Kingdom in attending the conference.
I appreciate that there will have to be reservations in the ratification. Almost every country has expressed reservations. Some of the points within the convention actually contradict one another. One could not possibly ratify it in its present form without any comment unless one had no serious intention of doing anything about it afterwards. And we do have a reputation for keeping our word. The Government in the United Kingdom share the central objective of equality. We have recently had additional initiatives

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such as the programme of action on women within the Civil Service. We have been quite a leading country in having the right laws. No doubt the noble Baroness, Lady Lockwood, knows these backwards from her experience on the Equal Opportunities Commission. We have the laws but we still need to see considerable changes in attitude. There is a vast difference in this country between the rights of women on paper and their rights and their position in reality.
In the 10 years of the decade we have had a remarkable number of "firsts"—the first woman Prime Minister, the first woman ambassador, the first woman head of the British Medical Association, the first woman general secretary of a major trade union, the first woman Law Commissioner and indeed the first woman Lord Mayor of London. So we have had clear examples of progress for women. However, the debate on women's affairs in this country is still very difficult. It is characterised either by over-aggressive attitudes which I think are totally counter-productive or by complacency of women who sit back and say that there is no need for change and everything is fine as it is.
Inevitably, life changes. We must, and gradually will, see changes in attitudes. However, in order to obtain any changes in attitude we must have the support of the men. The extremists in the women's movement who believe in a society without men, which is what I have had said to me regularly at County Hall where I served on a women's committee, are quite absurd and will never get anywhere.
I am a great supporter of family life. I was brought up in a family of five girls and three boys and I do not think that my parents ever differentiated; certainly it was never the case that the boys would be educated and the girls would not. Perhaps my mother considered that a battle in her day, because when she was at university there were only seven women there, so I suppose she was a pioneer. But in my time we all considered that we had the right to do whatever we wanted to do in life. Indeed, the young women of today are entering all sorts of fields which they had no opportunity to go in for previously.
This does give rise to some quite funny situations. For example, the women's committee at County Hall insists that there must never by any reference to "Madam Chairman"; it insists that we must call that person "Chair". To me a chair is something you sit on and also the chairman of a committee is someone who should not allow himself or herself to be sat upon. I believe that that is an important position and can do a great deal to help those on the committee to achieve some constructive results.
However, without doubt we have a situation where women in our country feel emotional guilt. Those who stay at home and look after their children—and quite often make a considerable sacrifice in doing so, because they need a second income and cannot get one by staying at home looking after their children—are accused of being Only housewives. I believe that that is wrong. I think that it is equally wrong for those women who choose careers and do the things they want to do to be accused by others of failing their families or letting them down. Women should have the right and
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the opportunity to make their own choices in life and they should be supported as much by other women as by anyone else. I am sorry to say that frequently it is our own sex who tend to turn round and be the ones to put the knife in. All the things that women have achieved in life, all the rights and responsibilities, they have achieved because men have supported them in this field. This is why I am pleased to see the number of men who are here today and interested in this debate.
The world conference in Nairobi will mark the end of the Decade for Women, but the work will go on after that. The United Nations set up a development fund for women in which our Government have been involved from the very beginning and they have contributed well to it. It is a fund to help the very poorest of the poor, and it has been a great success in helping over 400 projects, such as woodburning stoves for women in the Sahel desert. It comes as a shock to us to hear that these women have to spend perhaps two days of their whole week just collecting enough wood to be able to cook for their families. For us who are able to turn on a tap and switch on an electric light, I do not think we know the meaning of real hardship as we see it in these developing countries.
I am very pleased that we are in the process of forming a United Kingdom committee to help the United Nations Development Fund for Women, because at the last General Assembly it was decided that this fund was of such importance that it would continue after the decade has ended and carry on doing such good work. I know that the Government will support it, but I believe that the women of this country will also support it in a very big way, because we have seen their tremendous support for the Ethiopian situation, and this is a similar situation. The NGOs are anxious that the Government should be seen to support the United Nations Women's Commission, and it has already been announced that we shall be sending a very representative and excellent delegation to the women's conference in Nairobi.
However, the women in this country still need to know more about what is going on in other countries as well as in this country, so that we can help not only ourselves here but others who are less fortunate than ourselves.
3.25 p.m.
Baroness Seear: My Lords, I should like to congratulate the noble Baroness, Lady Lockwood, on introducing this debate this afternoon and I should like to support many of her points, but particularly the one that she made about the absence of women on many important committees, even where women have a very considerable interest.
I am normally a very strong supporter of the work of the Manpower Services Commission, but, to put it mildly, I was rather disappointed to see that there is only one woman on the three new committees that they have set up to deal with the extension of the Youth Training Scheme, which after all, includes all the girls leaving school as well as the boys. That one woman happens to be a former student of mine, but that is only a personal consolation.
I should also like to echo the noble Baroness, Lady Gardner, in her attitude towards the "no men"

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society. I may be rather muddled about this, but I should have thought that a "no men" society would last only one generation!
During the 10 years since the Sex Discrimination Act was passed, as the noble Baroness, Lady Lockwood, has said, there has been considerable progress. However, a great deal still needs to be done, particularly in the field of training for women, where we still have not exploited the opportunities for single-sex training and where women are grossly underrepresented. There is provision regarding this in the legislation, but we have not used it anything like enough. There must also be an overall attack on indirect discrimination. Direct discrimination in this country today is relatively rare, but we are riddled with indirect discrimination. From discussing this matter in various groups my experience has been that only about one person in 10 in an audience even knows what indirect discrimination means. Most people think it means a particularly devious, underhand kind of discrimination, whereas in fact it is a sort of discrimination which people perform in their sleep, so to speak; they do not even know that they are discriminating because it is so much a part of the culture and the way in which we do things that it carries on without being questioned.
However, it is not on those subjects that I wish to speak in the remaining eight minutes allowed to me. I want to focus on what I think is a central disability from which women suffer at all levels of employment. The vast majority of women, particularly but not exclusively married women—after all, today the vast majority of women are married—suffer from interruptions and discontinuity in employment.
The noble Baroness, Lady Lockwood, made some reference to this, but I believe that if we could take this as the theme, examine the various ways in which women's working careers are interrupted to their great disadvantage, and focus on either removing the causes of the interruption or alleviating the problem in all possible ways, we should make very considerable progress. They are interrupted on a daily and weekly basis because of the calls of family, of children, and also, we must not forget, because of the calls that are made largely, though not exclusively, on women when there are older people in the community—parents and aunts who need to be looked after. Therefore, someone has to be able to lend a hand and it is almost, though not entirely, invariably a female hand that is lent. That means breaks in employment on a short-term basis—perhaps only a day or two out when a child is ill. But it is still an interruption which handicaps a woman. Then there is the break with which we are all familiar—that which arises when a women has children and brings up her family.
What can be done to avoid these breaks, which are a very real handicap? Women are entering the professions in large numbers. The question is: how high will they go, how far up the ladder will they be able to progress? I believe that more than any other single thing, these interruptions will hold them back. A great many of the day-to-day, weekly, short-term interruptions will depend on the extent to which husbands are prepared to collaborate. A woman who
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wants to have a good career must either have no husband or choose him extremely carefully.
As the noble Lord, Lord Murray—who I am sorry is not here this afternoon, because I know that he would have been a strong supporter of opportunities for women—once remarked to his members in the trade union movement, "If occasionally a member would allow his wife to go to the meeting in the evening and stay at home and get the supper, it would make a remarkable difference". That runs through all society.
If men would share more in dealing with these family chores, it would help tremendously. This is why I hope the Government will not take too chauvinist a line about the question of parental leave. It may be that the exact terms which were proposed by the European Commission are not precisely right for this country, but that does not mean that the idea of parental leave is wrong; it is right. I know that with relative earnings as they are when there is a question as to who should be away, the man or the wife, it will normally be the person who earns least, and that will be the woman. But still the principle of parental leave is well worthwhile developing.
Secondly, there is the question of pressures, and perhaps even more than pressures, provision during school holiday periods. It is when you have growing, active youngsters around with nothing to do during the long school holidays that some of the worst family anxieties arise.
I want particularly to talk about another point raised by the noble Baroness, Lady Lockwood, but which I think needs developing fully, and that is a new approach to part-time employment—part-time employment for both men and women. In the past part-time employment has been largely ghetto employment in low-level jobs. It need not so be. The Phillips Company in Holland over the last 12 months has been developing extremely interesting examples of the way in which part-time work can be employment of good level for both men and women, worked into shift systems and on a voluntary basis, and can help a considerable number of people who wish to go on to five-hour working shifts on a part-time basis. This is the kind of thing which would enable many women to avoid the discontinuities of employment through which they suffer at the present time.
I ask the Government to look at positive ways of promoting this quite different kind of part-time work. One factor in particular that might be thought of relates to the taxation system. If only we had a lower band of tax to start off with so that people earning only up to a certain relatively low-level of pay paid tax at a lower rate, the actual hourly return to the person working part-time would be much less unfavourable in comparison with full-time work than it is at the present time.
When you move into the employee paying the full rate of tax of course the disadvantage is real. If we could have, as we once had—and I have never been able to understand why we still do not have it—a lower starting rate, people in part-time employment would pay very little indeed in tax and their hourly return on the work done would be relatively more worthwhile to them than in full-time employment. I urge the

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Government to explore ways in which a quite new approach to part-time employment could be encouraged.
Then of course there is the big, familiar problem of the break in employment for the women who marries, has children, and wishes to bring up a family. Again, may I urge a much more widespread use of retainer schemes by employers. These have been started in some of the banks, with considerable success. Women are guaranteed the opportunity to return at the same level of work and—and this is an extremely important part, for instance, of the Nat-West scheme—the women who are given a guarantee for a five-year period that they can return, do two weeks of work each year in the bank to keep their hand in, so that they never really drop out of the employment scene. This is important psychologically. It makes them feel that they can keep pace with what is going on in their chosen area of work, and makes it much easier to make the transition back into employment.
I know that the Government as an employer have been doing something along these lines, but it should be on a much wider scale than it is at present. It is a real way in which the disadvantages of the break in employment, the discontinuity in women's work, could be minimised.
Along with that I want again to stress the importance of retraining for women getting back into employment, and to echo what the noble Baroness, Lady Lockwood, said about the unfortunate change in the use of the community programme in relation to married women. In the past many married women have found their way back into employment through taking part in the community programme. This is now going to be barred to them since they do not rank as unemployed persons because they are not drawing unemployment pay.
In my view this is an absurd way of excluding women from extremely useful means of getting back into employment and overcoming the disadvantages of the breaks in employment. There are also other disadvantages. They are small in the sense that they are matters of detail, but important for the individual women concerned. For example, some women who go back on to training programmes—I had experience of this only a few weeks ago—are worse off on the training grant that they receive than they were on supplementary benefit because when they are on training allowances they cannot get the additional benefits which are available to people on supplementary benefit.
There are also disadvantages which arise from time lags in the payments of training allowances. These may seem small things, but they are important when people have practically no money and are making the brave effort to get back, via training, which is what we want these women to do, and therefore be able to be self-supporting and take part in the economy as a whole.
I see that I have overshot my time, my Lords. I shall say merely that if the Government want to promote these schemes, I ask them to look at the whole problem of discontinuity. I ask them also as employers to set an example far more than they have done in the past. I would just add as a throw-away line, though I
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realise that it is a highly controversial matter, that if the Government really want equal opportunities, I know of no better way of getting them than through contract compliance combined with good professional advisory services; but perhaps that is a matter for debate on another day.
3.38 p.m.
The Earl of Longford: My Lords, I must ask the indulgence of the House for intervening in a debate rightly regarded as ladies' day. However, I know how indulgent the ladies are. I know that the noble Lord beside me will feel the same diffidence. We are the only two out of the first nine speakers who belong to the weaker sex, or whatever they call it nowadays.
Of course I endorse the fine stand taken on behalf of women by my noble friend Lady Lockwood and sustained by the noble Baroness opposite and the noble Baroness, Lady Seear. I shall confine myself to one aspect of the problem which has been set up most authoritatively by the noble Baroness, Lady Seear, but I want to deal with just one aspect of it. I am going to deal with the difficulty of married women with children making a success of a professional career. It can be done, but it is not done anything like as often as it ought to be done. For instance, take this House. For 40 years after women were able to sit in the House of Commons the idea of women coming here was strongly resisted. Eventually, four women were allowed to come here, two of whom I am glad to think are among the most distinguished Members, including the noble Baroness, Lady Elliot, who is sitting opposite me now.
However, even that was not the end of the story at all. The enemies of women were fighting very hard. I remember one gentleman who played a leading part in resisting the coming in of women explaining to me that he could not bear the thought of them coming into the Library so that he would have to get up, or perhaps be woken from his slumber. And then there is the old question of the lavatories, which was regarded by a lot of people as an almost insuperable objection. At any rate, it prevented women en bloc coming here for 45 years. I remember this same gentleman—a very eminent man in his way—saying when referring to a lady colleague, one of the new Baronesses (but not the noble Baroness, Lady Elliot) that he hated to look at the back of her neck. He said, "When I see that long neck bending over I say to myself: 'I wish I had my chopper and I would go chop, chop, chop' ". I did not make that up. I am just trying to show you what problems women have been confronted with in making their way here.
Today there are 64 women in this House—I have just looked up the figures—but in the House of Commons there are only 25, which is no large number. It is almost the same number as there were, say, in 1945, though in the intervening years there has been a higher number several times; so there they are stuck. No one would question that the women in this House have a far bigger influence than the women in the House of Commons, where, apart from Mrs. Thatcher, they do not count all that much, so it seems. I must be careful here because I have a niece who is making a lot of headway there, but by and large what I have said is a true generalisation. In fact, here today

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you might say the women have almost taken over, but there in the House of Commons they are still second-class people, and possibly a diminishing band. That makes one think a little.
We all know the reason for that. The reason was supplied by the noble Baroness, Lady Seear, and the noble Baroness, Lady Lockwood, also. It is what the noble Baroness, Lady Seear, called "the discontinuity of employment". Sociologically speaking, what is the special aspect of the women Peers? Personally speaking, of course, the noble Baroness Lady Cox—whom I congratulate on joining the Front Bench—would exemplify so well their abnormal charm, but sociologically speaking what is the factor? The factor is that, generally speaking, they have been able to rear families, to go in for local government, in many cases—I am not aiming this at anyone in particular—paid for by their husbands en route. They come here in middle life and make a great success, every now and then leading the House or acting as Chief Whip or acting in some other capacity. That is the position of women in the House of Lords, and I venture to say there is no side of British life where women are quite so prominent and influential as in the House of Lords. Possibly you might find it in the arts, but I doubt if you would find that even there.
What is the explanation? It has been touched on. They have been able to rear their families and acquire some eminent status, and then in middle life to come here. That is not true of the other professions, and in the House of Commons it is very much not so. That is the problem which has been dealt with very thoroughly by the noble Baroness, Lady Seear.
To take other occupations, I do not know how matters stand now in the City. For eight years I was chairman of a bank, and I used to lunch in the City every day. I never met a woman at lunch. As chairman of a bank I went to quite good lunches, and there were no women about. I do not know whether they are there now. Somebody said you might meet a financial analyst, some female journalist or something. You might, but by and large I suspect, from what I have been told, that it is still as it was then—that women just do not exist in the City compared with the men, or compared with their role here. So we have to think about that very carefully.
I have been in publishing, either as chairman or as peripheral director, for 15 years, and I have dealt with a great many young, talented and efficient women. In all those 15 years I know of only one who married and continued in the profession. Now that she has had two children she has retired to work at home. That is just one small example. That is the situation in that profession. I have mentioned the City and public life. My own wife, as some people know, had a lot of children—eight, if I remember rightly—and my three surviving daughters have had 12 children between them, and they have all been successful writers in their way, but working at home. That was the essence of it.
My dear friend Lady Warnock, whom I had the honour of helping to introduce the other day, has had five children. She has come here and no one could say that she has not succeeded in public life, but she has been based at home, at Girton, where she has now
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become the Mistress. Whether that counts as "home" I do not know, but at any rate she was able to succeed based at home. So I am talking of a pretty wide category. It is not the whole area of women, but it is a pretty large category. I am talking of the women who want to go out to work and want to succeed in their professions. I will not try to improve on the way it has been analysed and discussed by the noble Baroness, Lady Lockwood, and the noble Baroness, Lady Seear. I am sure that the solution does lie primarily along the lines suggested by the noble Baroness, Lady Seear; that is, finding some way of giving these people part-time work.
I am well within my time, but what has been said by other speakers is really what I should like to say, so I will endorse what they have said and now draw to a close.
Lord Annan: My Lords, would the noble Earl—is there any time to ask the noble Earl a question?
Lord Glenarthur: My Lords, I will answer as far as I can at this stage, but if the noble Lord does so he would cut into other people's time; and it is a fairly strict time limit, anyway.
3.47 p.m.
Lord Ardwick: My Lords, this is by no means a new problem. Sixty years ago my mother used to lecture to women's co-operative guilds on a subject then called, "Married Women in Paid Professions". That was in the days when most men believed that a woman's place was in the home. There was one problem, however, which the professional woman then did not have but which afflicts the professional woman today. Sixty years ago there was an ample supply of what was brutally called "cheap domestic labour". The professional woman did not have to neglect her home or do an exhausting double job. But that was her only advantage. She had to surmount a wall of masculine prejudice in her chosen profession and among her prospective clients, even among her own family.
That prejudice applied also to women going into public life. When my mother first contested a council election it was put about by the wicked Conservatives on the doorsteps that she was neglecting her children. There was only one answer: my sister and I were well scrubbed, pushed into our Sunday clothes and paraded on the political platforms. It was only natural that with such an upbringing I should do something to extend the opportunities for women in my own profession of journalism. I enabled Mary Waddington, who has become a great fighter for women's causes, to become one of the first women sub-editors on a daily newspaper, and I appointed a woman news editor. I had to withdraw the first woman municipal reporter because the committee chairmen were chaffed by their colleagues if they were seen having the necessary private conversations with her in the Gothic alcoves of Manchester Town Hall.
The war years got rid of such foolishness, which was never very strong in the metropolis anyway, and my noble friend Lady White, when she became one of the first women political correspondents at Westminster 40 years ago on the paper I was then editing, did not have that kind of problem. Today, I believe there are

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five women in the Lobby and 15 in the Public Gallery at Westminster.
As I say all this it sounds like pride, but it is pride that goeth before a fall. In 1971 there was the great women's liberation procession in London, and I went to the start to size it up and advise the newspaper group I then served. I was first invited and then challenged to join the procession, and this I did. It was the first demonstration I had taken part in since the protests against the Munich agreement.
Behind me there was a cohort of women singing that men could wash their own dirty underwear when the day of liberation came. In front of me was the Gay Liberation Front. In line with me were three young women: the first had a poster claiming abortion on demand, the second was claiming free contraception, and the third was dealing with the inability of women to get into high professional jobs. She claimed that one of the jobs that women could not get was that of an airline pilot. The first of these aims has been achieved. We do not have abortion on demand, but there is a liberal attitude on abortion. The second aim of free contraception has been with us for years with not even a prescription charge. The demand for women to become airline pilots took longer. However, I understand now that Dan Air have two female captains. That is not all that surprising: it is 50 years since Amy Johnson made her great pioneer flight.
Professional freedom has been harder for women to attain than the sexual freedoms which they had to have to hold certain jobs. We have recently had an example in reverse of the kind of prejudice that women had to suffer when there were objections to male midwives in spite of the fact that most gynaecologists are men.
I thought that by walking in this procession I had behaved in a gallant and progressive way. This was not how it was judged when I got home. I met derision. I was called the biggest hypocrite since Moliere's Tartuffe. Was not the great liberator—me—dependent on three female slaves; that is, a dedicated secretary, a devoted wife and a dutiful daughter? When had I ever looked up a telephone number, wiped a dish or changed a napkin? The charges were true. But they illustrate the difficulty that the male well-wishers of women's liberation have had in these past few years in bringing their conduct into line with their beliefs. I may add that in my experience some liberated women have had similar difficulties, claiming freedom while demanding the privileges of dependence. Individuals are not wholly to blame. We are all the victims of habit, the prisoners of inherited prejudice and convention. The younger generation is less entrapped by the past.
In recent years there has been a vast increase in the number of women in journalism. But we have not had a woman editor of a national daily or Sunday paper. Why not? It was not for any lack of talent. Two reasons spring immediatly to mind. If I was cosseted as an editor in office and in home it was a necessity because an editor works morning, noon and night and has heavy continuous responsibilty. How many ambitious women journalists can hope to get the good and complete answer to their domestic problems that I enjoyed? Indeed, I have known a number of masculine
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journalists who have sacrificed their careers by taking on domestic responsibilites which left them without the freedom they needed to go anywhere at any time and to stay there for as long as was needed. This domestic problem is one that has held back women from the highest jobs in a variety of professions.
The only way out that I can see is to professionalise housekeeping as we have professionalised the children's nurse. I hope we shall never return to the days of an ample supply of cheap domestic labour, but we might get an adequate supply of well-paid domestic skills to be available perhaps on a contract basis. If that housekeeping profession is to be highly paid then the people who will pay the high wage, the working husbands and wives, should have it chargeable against their taxes. I am speaking only of the highest jobs from which women are debarred by domestic circumstances.
What of the rest? I suppose that the new concepts of flexible hours will be a help, or we might get Government departments to provide more part-time jobs. I think the essence is that the jobs should be part-time, permanent and pensionable. This is perhaps the best way we can overcome the problems.
The problems at this level were well dealt with in today's Daily Mirror by its very down-to-earth, common-sense columnist Anne Robinson. She said:
"it's when a woman becomes a mother she realises that equality and independence through earning power has almost certainly taken a final and irrevocable leap out of the window … Once they (children) are born employers don't consider them and husbands rarely assume them to be a truly joint responsibility".
She pleads, as so many have pleaded, for creches, etc. She concludes:
"In 1985 what we need is not so much rights for women but mothers' liberation".
The other problem of the executive woman is masculine prejudice against being directed or supervised by a woman. When once I proposed a woman of brilliant flair as the editor of a Sunday paper, I was told, "The chaps would never stand for it!"
We have known some other chaps in another profession who seem to have overcome this problem. They include some noble Lords. We might ask them, not in this Chamber but perhaps in the privacy of the Bishops' Bar, how this miracle has been achieved.
3.56 p.m.
Baroness Robson of Kiddington: My Lords, I also add my thanks to the noble Baroness, Lady Lockwood, for having introduced this debate today. I should also say how much I join the noble Baroness, Lady Gardner of Parkes, in welcoming so many men in our Chamber today. Particularly I should like to tell the noble Earl, Lord Longford, that not by any means was he intervening. I am delighted that six men are taking part in our debate on the status of women today, and everybody is most welcome.
The noble Earl told some amusing stories about the first entry of women life Peers to this House and the problems that it created in the Library and in the lavatories. I agree with him that the women I have met in this House have been outstanding women and we can now say perhaps that we have truly arrived when

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that little room next to the Printed Paper Office belongs to the Peeresses.
We have had outstanding speeches from all Members of this House on the position of women in employment The Motion also mentions women in public life. I should like to concentrate purely on the problem which women find in taking part in public life. We have moved a long way since I came to live in this country. I remember, when I first arrived here just after the war, taking my passport to the passport office to have my son's name put on it, so that I could go to see my parents. I was told I could not do that without my husband's permission. I asked, "If he wants it put on his passport, do I have to give my permission?" I was told, "No".
We must as women admit that in law we have achieved virtual equality. We have moved a long way in public life from the principle that for a long time prevailed of the "statutory woman" on almost every authority. In some cases we have lost the statutory woman and in others we have improved our position.
The noble Baroness, Lady Lockwood, referred to the report issued jointly by the Equal Opportunities Commission, the three main political parties and the Women's National Commission on the position of women in public life. This report is very revealing and has produced some interesting results which are worthy of note. It was always my understanding that the Public Appointments Unit was of great importance when Ministers or administrators had to select people suitable for public committees or authorities. I find in this report that the Public Appointments Unit has only 4,500 names on its list and of those only 16 per cent. are women. But if I read a little further, I also find that 28,000 appointments of one kind or another are made in a year; yet there are only 4,500 names on the list. Obviously, those appointments are made on another basis. They are made, as has been mentioned, very often, through the old boy network, and this is where I think perhaps women ought to learn a lesson from men. I have not really heard of the old girl network; but the old boy network certainly functions very strongly and maybe we, as women, should learn something from it.
Because the Public Appointments Unit cannot supply enough names of people suitable for appointment, use is made of such nominating bodies as the TUC and the CBI, and they are almost totally male orientated. This equally applies to such nominating bodies as the professional organisations and associations. One of the few I can think of which is not male orientated is that for the nurses and midwives. In my eight years as a health authority chairman, I have had quite a lot of personal experience of nominations, particularly from the TUC. As the House is aware, every health authority has a member nominated by the TUC member; nominations are submitted by the TUC. In my region there were a regional health authority, five area health authorities and later 14 or 13 (I cannot quite remember now) district health authorities. Not a single nominee of the TUC was other than male. We never once had the opportunity of appointing a woman as a TUC representative to the health authorities—and one would have thought that this was particularly the kind
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of authority where even the TUC might have thought that a woman would be useful.
There is another sad thing. In the Health Service today not a single chairman of a regional health authority is a woman. In 1974 there were two—myself and Dame Betty Paterson. But as soon as we retired we were replaced by men. I feel that this is a great sadness. I really admired Sir Keith Joseph when he made his original appointments because he appointed two women as chairmen of regional health authorities. This practice has now fallen by the wayside. We must therefore ask ourselves what possible remedies we can look for to break into the old boy network and the mainly male-orientated nominating bodies. I believe that we could base our experience on what took place in Wales where, for appointment to health authorities, for instance, general advertisements were placed in the press and the uptake by women in response to the advertisements was most heartening.
I think that this could be used to much greater effect but it is administratively rather cumbersome. Be that as it may, if it resulted in a greater number of women being appointed to public bodies, I believe it would be worthwhile. I also believe that there should be much more clearly defined criteria for appointments. It is too often the habit when somebody retires to look for an appointee who is just like the person who is being replaced. Nobody has ever really worked out proper criteria that should apply to the various appointments to the different types of organisations, bodies and committees.
As has already been mentioned what also militates against women being appointed to public bodies is the fact that their representation in political life is nothing like it should be. It is often true that you are appointed to a committee because you are a political representative or because in public life you have made your name in politics; therefore you are appointed to most interesting and absorbing committees. Only 4 per cent. of the Members of the House of Commons are women; we all know that. But I was absolutely staggered to read that only 18 per cent. of the members of metropolitan and county councils are women. I had thought that the proportion was much higher. In Sweden, where I was born, the proportion of women in the equivalent to the House of Commons is 28 per cent; which to me represents a much more satisfactory number.
We may ask ourselves what is the reason for this situation. I think that we must look at the social conditions which have been referred to under which women in this country labour. In order to take even a part-time interest in public life they need social support. As a country we have one of the lowest percentage of nursery places for the under-fives in Europe. Additionally, in our new desire to move people from the big institutions—something which I thoroughly support—back into the community we have placed an additional burden on the women of this country. My noble friend Lady Seear referred to this. I believe that now about 13 per cent. of the women of this country have caring responsibilities which prevent them from taking part in public life unless they are given the support which the community services really should provide. I believe, too, that a change in recruitment and a change in

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support services could immeasurably improve women's opportunities to take part in public life.
4.8 p.m.
Baroness Ewart-Biggs: My Lords, my noble friend has chosen for her Motion a subject which can always do with an airing. For that reason, we are extremely grateful to her. Indeed, the very fact that we are having this debate is ample proof that the circumstances surrounding a woman's place in society are infinitely less firmly structured than those for a man. Moreover, those circumstances are more vulnerable to the economic pendulum of the times. So, all in all, I think there would be general agreement that it is much harder to be a woman than a man; and while that situation remains unchanged there will always be a need for the whole subject to be discussed: although I cannot help feeling that if the situation had been reversed and this debate had been concerned with men's position in society, then not very much levity would have been allowed to creep into this debate.
However, I should like to focus on the central theme of this Motion; namely, the position of women who are left or are impelled to fill the two major roles of being a mother and a worker. I believe it to be true that we live in a society which accepts that this should be so but which has done very little, and that in a very half-hearted way, to adapt to the changes which have flowed from the increased share of work now carried out by married women outside the home. Based on the fact that, out of the 43 per cent. who represent the number of women in the workforce, over two-thirds of that percentage are married, we can only ask ourselves what has been done to help those women carry out this very heavy burden.
The key questions would seem to me to be the following: first, the question as to whether the attitudes towards the working mother have changed. The noble Baroness, Lady Gardner, brought out this point and I think it is a very important one. Secondly, there is the question as to whether sufficient adjustment has been made in the whole network of benefits and taxation arrangements to accommodate the situation. After all, it must be remembered that only 5 per cent. of parents now conform to the old style of the bread-winning husband and the entirely domesticated wife with two dependent children.
Thirdly, have fathers accepted that it is really their combined role, with their wives, to bring up their children? Has any legislation been devised to support this dual role? Next, has the provision of child care facilities grown or receded? Are women suffering discrimination where training opportunities are concerned? While more and more emphasis is being put on policies for care in the community, are women taking on the major burden as carers? I feel these are the leading questions, and there are indeed many others which need to be answered so that we can decide whether women are achieving a more equal place with men in the labour market.
First, however, what are the answers? The answer as to whether attitudes are changing I think must be, "Yes, but slowly". It has already been explained by my noble friend that Britain took the lead in introducing the Sex Discrimination and Equal Pay Acts, followed
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by the setting up of the Equal Opportunities Commission. Now European legislation has forced us to strengthen equal pay legislation and to strengthen women's rights a little further. Such Government measures must do a great deal to dislodge old, entrenched views as to the place of women; but that is not really everything. Indeed, the danger then is that many people will sit back and say, "We have done our best, we have created a framework in which women will have equal rights and we can now sit back".
The important part, as has already been said, is to turn the principle into reality so far as women are concerned. Also, there is no doubt that part of our tax and social security system discriminates against the working mother. That has already been made clear. If she is part of a two-parent family she would undoubtedly benefit from the abolition of the married man's allowance and the introduction of a system of mandatory independent taxation for herself. If she is a single parent-working mother, then the system does not make any suitable accommodation for her. The recommendation that, in line with widowed mothers, she should receive a non-means-tested and noncontributory one-parent family benefit has been consistently rejected ever since it was made.
My third point relates to the attitude of a father regarding the sharing of responsibility with his wife in bringing up their children. I have no doubt, from the young couples I know, that among them the father fully welcomes and accepts his joint involvement. Indeed, he probably deplores the fact that in bygone days the father's choice—his own choice—was limited so that he spent all his time out of the house, returning in the evening so tired that he could not enjoy his home, family or children. The woman's choice, meanwhile, was limited to working in the house and she was deprived of the wider experience which a growing number of women both wanted and needed to achieve.
Having conceded that, let us look at what legislation has been brought in to support young parents who wish to take an equal position in the bringing up of their children. As has been said already, the very disappointing reply to this is revealed in part through the Government's reaction to the recent debate in your Lordships' House on the European Community's committee report on parental leave. The Government rejected the recommendation of the committee that there should be a minimum period of one month's leave for each parent while the child is under two years of age. From the number of your Lordships who have mentioned this aspect, it would seem important for the Government to think again and see whether they could in some way bring themselves into line with many of our European neighbours, who have a very much better record over parental leave.
Indeed, in Sweden, which usually seems to head the league, either parent can take six months off with 90 per cent. of pay in the first year of the child's life, or that can be shared between them. Norway has a similar scheme but it allows for a shorter period. France also has a scheme whereby either the mother or the father can take periods adding up to two years of unpaid leave to care for their children, and they can decide which one will take it. Not only do these methods draw the parents together in their joint

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responsibility of caring for their children but the major obstacle to employers taking on women must thereby be removed.
Turning to child care facilities, without which working-class mothers at any rate face a hopeless obstacle to employment, the picture here in Britain does not look very good. Our state nursery schools absorb only 1 per cent. of the country's 3 million under-fives; another 22 per cent. of our under-fives have private nursery education and 18 per cent. are admitted to primary schools. The French, who I think are really at the top as regards giving priority to child care provision, absorb all their four-to-five-year-olds in nursery schools, together with 88 per cent. of their three-year-olds and 33 per cent. of their two-year-olds. There is no doubt that our low rate of child care provision will be further aggravated by the rate capping and by the abolition of the GLC, because so many of the projects concerned with child care facilities are at the moment funded by the GLC and the boroughs.
With regard to the training opportunities for women, I should merely like to reiterate how the lack of child care facilities often prevents young mothers availing themselves of training opportunities. I should like to mention, as my one example, a particular instance, whereby one-parent mothers can be denied training facilities. That occurs in the case of two Government-sponsored national training schemes: the YTC and the Training Opportunities Programme. In neither case do the MSC or the DHSS take responsibility for the payment of child care costs for women while training. The result is that either a young woman will suffer terrible impoverishment by putting her child into nursery care at her own expense or she will have to deny herself the opportunity of bettering herself and remain on supplementary benefit. That indeed does seem an ironic discrimination when one recalls that these schemes were specially devised to help young unskilled women to become more self-reliant.
Finally, who are the carers who look after not only small children but the disabled, the frail and the elderly? I think there can be no doubt that the majority of those carers are certainly women. It really does seem wrong that there should not be a fairer division of labour in this regard and also that those who are unable to earn as a result of these responsibilities should not be helped by means of a proper carer's allowance. That, again, is a point which has been brought up in your Lordships' House on many an occasion.
This is not the first time that some of these points have been raised; but while the anomalies, injustices and obstacles continue to affect the position of women in economic and social affairs—which is the subject of my noble friend's debate—it seems right to bring them up again and again. Indeed, would it not seem a strange paradox when in years to come we look back at the present coincidence of the first-ever Government led by a woman, combined with a continued undermining of working women's opportunities? It must be recognised that at no point does the Government's record display enough sympathy for the Prime Minister's peers and
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contemporaries who, like her, also happen to be working family women.
4.19 p.m.
Baroness Platt of Writtle: My Lords, it is a great pleasure to take part in this debate. I must first apologise to your Lordships for my lateness and, therefore, for having, to my regret, missed the noble Baroness's introductory speech and other early speeches. I shall read them with great interest in Hansard tomorrow. Unfortunately, I became aware of this debate only late last week and, although fortunately I was able to put forward an important engagement, I was unable to cancel it.
Following as I do the noble Baroness's distinguished chairmanship of the Equal Opportunities Commission, to which I take great pleasure in paying sincere tribute, this subject is naturally very close to my heart, as it is to hers.
We are now coming to the end of our first decade. The Sex Discrimination Act was passed in late 1975 with, I am glad to say, all-party support, and the commission was set up. In its early years, the commission was dealing with complex and novel legislation and in that position you always have to learn some things the hard way. The commission was fortunate in the experience built up by professional staff and commissioners, so that it has established a sensible and respected reputation.
The position of women is changing fast. Now the majority of married women work full or part-time. In 1921, married women formed 3·8 per cent. of the workforce, rising to 11·8 per cent. in 1951, and to 25·9 per cent. in 1981. Women as a whole now form approximately 40 per cent. of the total labour force. Only 5 per cent. of households today are made up of working husband, economically inactive wife and two dependent children. On average, a women is likely to be out of employment for less than four years after the birth of a child. Later, as their families grow older and more independent, they are likely still to have 20 years' full-time work ahead of them.
Often they work as a matter of necessity. There are 1·6 million families, of whom 1·2 million are dependent on women as the breadwinner. Three times as many families would be on supplementary benefit if the wife were not earning, too. Sadly, the divorce rate is increasing, which is likely to make the situation worse. Women, from both choice and necessity, are part of the workforce. Their skills and talents, like those of men, are available to make their contribution to their own prosperity and that of industry and commerce in this country. Still, however, women are concentrated in a narrow range of low-paid, unskilled areas of work. About two-thirds of women, according to last year's Department of Employment survey, are working only with women. Unfortunately, that might be described as women's work.
Women's hourly earnings, in comparison with men's, have risen only from 63 per cent. at the time of the passing of the Equal Pay Act in 1970 to a plateau of about 74 per cent. over the past few years. In January 1984, the equal pay for work of equal value amendment was passed—too complex, in our view, for all concerned. Nevertheless, it provides an

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opportunity for obtaining a further rise in that proportion, so that women may be more fairly rewarded for their work.
Yesterday was a milestone in the work of the Equal Opportunities Commission at the end of its first decade. We launched our new code of practice, and many influential people, including my honourable friend Mr. Tom King, Secretary of State for Employment, Sir Terence Beckett, Director-General of the CBI, and Mr. Norman Willis, General Secretary of the TUC, came to speak in favour of it. We were very fortunate that all those influential people were prepared to give their time to back our code. That will be of great help in the future in giving the code the necessary impetus.
As many people have said today, we still have a long way to go. We are pleased that the code is being published by the Stationery Office and we already have thousands of requests for it. This final version represents the cumulative experience of the Equal Opportunities Commission during years of continuous dialogue with employers, trade unions, Government departments and national organisations such as the Institute of Personnel Management and groupings of small employers. We have been most grateful for their positive and constructive help.
I pay tribute with pleasure to the long, patient and careful work of our own staff and commissioners in bringing together all the different points of view. That ensures that the final version incorporates a wealth of combined wisdom, experience and expertise. We believe that the code of practice is practical and refers to life in industry and commerce as it is really lived today and that no employer can afford to be without it.
In preparing it, the EOC had in mind employment opportunities and people—those who provide employment and those who seek it. It is about fairness for women and men in line with the spirit of the legislation, the legislation itself and its ensuing case law, the practical experience of the people we consulted and our own, and the need to maximise the use of the most important resources in any organisation—the human resources.
As your Lordships know, the code of practice is all one, in that any part is admissible in evidence before a tribunal. It is, at the same time, in three parts—you might say a veritable trinity. The first part shows how to act as the law requires now. It sets out the role of good employment practices in eliminating sex and marriage discrimination. The legislation is complex and difficult to understand. Most people in this country actively wish to obey the law, and we hope that our recommendations, which are short and to the point, will help everybody to understand the law better.
It is clearly laid out under headings, such as Recruitment and its Sources, Selection, Promotion Transfer and Training, Terms of Employment, Grievances, Disciplinary Procedures, Dismissals and Redundancies. We hope it will show all those involved—employers, employees and trade unions—where justice lies and how to act according to the law. We believe it will help to avoid costly and
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damaging litigation and assist in the management of change for the better for women in the economic field.
The second part shows how to give effect to the spirit of the legislation and the role of good employment practices in promoting equality of opportunity between women and men. Here there is likely to be some cost, but we believe that this is investment in developing the talents of people; the sort of investment which results in future profit to companies—the best sort of management of resources.
Part III is a legal annex describing the relationship between the Equal Pay Act and the Sex Discrimination Act and it quotes relevant sections from the legislation. It sets out the legal background on a simple basis. Many people have backed us, as well as our speakers yesterday. My honourable friend the Under-Secretary of State at the Department of Employment, Peter Bottomley, said last autumn:
"Where people are not given an equal opportunity to contribute their skills, employers will suffer … Discrimination is bad business.".
John Cassels, Director General of NEDO at the WISE Conference last autumn said:
"At a time when the demand for skills and competence is rising fast, what could be more ludicrous than to overlook the contribution which half the population can offer? If social justice fails to carry the day, economics will."
There are many distinguished people speaking for us.
We feel it is very important, as the CBI stated at their conference last autumn, to have a clear and consistent strategy known to everyone. A written equal opportunities policy promotes a sense of security and trust between employer and employee, particularly if it is seen to have the backing and active support of management at the highest level. That gives it proper and sensible authority, and both men and women at all levels of the company can feel on firm ground in carrying it out.
At our launching of the code yesterday, the CBI issued at the same time their equal opportunities guide and statement, and we were very glad that they did this in parallel with our code. They did it to encourage employers to develop their own clear equal opportunities policy. As they said,
"Many companies who operate a formal policy of equal opportunities in employment believe that it makes sound business sense in terms of developing the full potential of employees."
We are very encouraged that more and more companies are paying serious attention to equal opportunity policies and that a number have put such policies into effect already—before the code was issued. Their successful experience will be of great help for succeeding companies who follow them and we hope that there will be many more.
The Engineering Council, of which I am a member, recently quoted statistics. In 1981 there were 900,000 18 year-olds. In 1995 there will be only 600,000 18 year-olds. That is a dramatic drop in available human talent at a time when our population is ageing fast; I expect that I shall be nearly in my grave.
I was asked by the CBI to chair a syndicate in response to the Butcher Committee on the shortage of IT skills. It is clear that there will be an increasing shortage of skilled talent in these fields for the remainder of the century. With the advent of the

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cashless society, the installation of computer-aided design and manufacturing, robotics and the automation of all booking systems, that shortage can only get worse. As the chairman of a chain store said that day, we are all the customers now.
There will be intense competition for the more able amongst those 18 year-olds in all fields, whatever their specialism and level. I am not talking just about technicians and technologists but also about the ever-increasing knowledge-based workforce. To paraphrase Sir Kenneth Corfield, chairman of STC, they will need to be able to see, understand and control the application of the new technologies in their own fields.
This underlines the importance of the continuation of the WISE campaign in schools, colleges and universities to see that girls play their full part in meeting the need for those technical skills and talents in the future—but that is a long-term measure.
I am sorry, my Lords, but it appears that I have overrun my time. I did not realise that one should speak for only 10 minutes. I did have more to say.
Baroness Cox: My Lords, one speaker has withdrawn from the list and so perhaps the House will agree that my noble friend may continue.
Baroness Platt of Writtle: I am most grateful, my Lords. It was endlessly repeated at the CBI meeting which I chaired that the short-term answer to the problem must lie in maximising the talents of the existing workforce. Helping women to bridge the career break, to combine responsible family life and a career, makes good commercial sense, and to see to it that expensive investment in education, training and in-house expertise is not lost either to the employer or the employee should be the order of the day.
I will omit the quotation I had intended to give from your Lordships' Select Committee on Science and Technology, but there again the importance of women and girls in these fields was particularly emphasised—especially that of mature woman. There are many mature women within the workforce today who are not fulfilling their capabilities, who are willing to retrain to attain promotion and responsibility and who did not have that opportunity when they were young. Enlightened employers will seek them out and will enable such women, equally with men, to use their skills and talents.
Recently, I visited Japan with the Select Committee. The Japanese find themselves in the same situation of having an ageing but developing nation. They are realising, at last, that they too must use the talents of women, taking on women software engineers, with equality legislation now going through their Parliament. We have a head start; let us not lose it as we have done in so many fields.
I hope that the code of practice will become a modern manager's manual. I hope it will mean that more women will go into management, as indeed they are doing, and that more women will be appointed to boards of directors. I can never understand how a company can decide to sell its products throughout the world without having half its customers represented on its board.
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Perhaps I may conclude by referring to the subject of parental leave. We support the European directive which your Lordships recently debated and hope that the Government will, as they promised, enter consultations and find some way through so that that proposal can be supported in Europe.
We feel very strongly that women are the carers in society. We want to see voluntary work continue but we need statutory support to ensure that women are not left on their own without backing. Both central and local government need to see to that. We need also to equalise the pension age. We are delighted that my right honourable friend the Chancellor of the Exchequer is considering individualising tax.
I shall now end my remarks. I will finish by welcoming this debate. As your Lordships can tell from the way I have been turning over the pages of my speech, I have omitted much of what I had intended to say. Still, I hope that as a result of drawing attention to this vital subject we shall see an improvement in the economic and social position of women and in the position of women in public life, bringing true equality of opportunity for women in their train.
4.36 p.m.
Lord Hatch of Lusby: My Lords, unlike the noble Earl, Lord Longford, I feel no necessity to apologise for participating in this debate. I believe that I am qualified to do so, if only as the sole male member of my party's women's committee. I was also privileged to spend some years as the chairman of the board of governors of a girls' school having some 1,350 pupils in London. I may say that I was successor to and succeeded by a lady chairperson.
Moreover, it has always seemed to me, having been brought up in a feminist household, that it is we males who stand to gain most from women's equality. I was pleased to note that the noble Baroness, Lady Platt, mentioned equalisation of the state retirement pension. That is one material way in which we might stand to gain from women's equality.
There is a much more serious and less material aspect which I believe in and with which, I imagine, many other men would agree. It is that true, lasting and deep relationships between men and women are possible only when women are given equality or when women take equality; when men and women are equal.
I want to address myself this afternoon to one point alone. It is one to which I hope the noble Lord who is to speak for the Government will spend a moment or two addressing himself. I speak in particular of the discrimination in the immigration rules. It is of course racial discrimination, but I am not going to speak about that aspect of it this afternoon. I am concerned here with sex discrimination in the immigration rules.
Let me simply state the situation; a situation that has led since February 1983 to the imposition of deliberate sex discrimination in our immigration practices in this country. It is discrimination so gross that it is now being tested before the European Court of Justice. It is a matter of shame that a British practice should have to be taken to the European Court of Justice in respect of any matter concerning human

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rights and particularly on the issue of sex discrimination.
The rules as they stand at present mean that a wife who is a British citizen has no right to have her husband join her in this country. It means that a fiancée who is a British citizen has no right to have her fiancé from abroad join her in this country. Neither wives nor fiancées, if they are British citizens, have as a right the power to be joined in this country by their foreign husbands or fiancés. What can be more sexually discriminatory than the fact that if the case involves a man, if it is a husband or a fiancé, he has an absolute right to be joined either by his wife or by his fiancée from abroad? This is an absolute right.
Secondly, if the woman is not a British citizen—and remember, my Lords, it takes both time and money to gain British citizenship; I believe it costs roughly 160 and takes about two-and-a-half years—whether she is a wife or a fiancée, there is very little chance at all that she will be joined by either her husband or fiancé. That is not the case for men. Men are entitled, whether husbands or fiancés, even if they are not British citizens, to be joined by their wives or fiancées in this country. Can the Minister say that that is not deliberate sex discrimination?
What does this arise from? Surely it arises only from the concept mentioned by my noble friend Lady Lockwood, that there is still an attitude that the male is the head of the household. But as my noble friend pointed out, a very large percentage of women are now working. According to Department of Employment figures, 63 per cent. of women in this country are economically active. I know that it is said that these rules are specifically designed to keep out Asian men, but over 40 per cent. of Asian adult women in this country are working and that number is rising; so that excuse is disappearing. In any case, do this Government accept that the male is to be considered as head of the household? Is that excuse to be used to separate husbands and wives, to keep families apart and to keep children out of the country?
We have heard much talk about Victorian values. Which Victorian value does this rule observe? Was it not one of the Victorian values to keep families together and to create situations in which they could live together? Is that the Victorian value that is being observed by the application of these grossly discriminatory immigration rules? I suggest that the Government have a case to answer and that by their immigration rules they are quite deliberately keeping families apart, keeping children from their parents, keeping wives from their husbands, and husbands from their wives, and preventing fiancés from getting married in this country.
This is not a minor issue. It is estimated that since these rules began to be applied in February 1983, 60 per cent. of the applications by husbands to enter this country in order to be with their wives have been refused. They have been refused on all sorts of grounds. As I said, even if the wife is a British citizen, she has no absolute right for her husband to join her. The way in which the immigration rules are applied means that the immigration officers have a great deal of subjective attitudes towards the applications for
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entry certificates. Moreover, perhaps even worse, is it realised that if a husband is deported from this country, the wife is automatically deported too; but if a wife is deported, it does not apply to the husband? I suggest that this is a case which the Minister should answer. I suggest that perhaps it is those Victorian values in which the women was considered to be inferior, in which the man was considered to be the head and the ruler of the household that are being applied in this case.
I remind noble Lords that this same principle was adopted by Adolf Hitler and his Nazi party when he talked about kinder, kirche and kiiche—children, church and kitchen—as the right place for women. I suggest that there is no such philosophy acceptable to the people of this country and that it is high time we did not have to rely on the European Court of Justice to apply the ordinary, universally accepted, concepts of justice so far as our community is concerned.
4.47 p.m.
Lord Tordoff: My Lords, it is interesting (is it not?) fellow nobles, that we have all addressed ourselves this afternoon as, "My Lords". We all do that, of course, because we know that it includes everybody in the Chamber. The noble Baroness, Lady Gardner of Parkes, made a point about chairpersons, and I must say that I agree that that is trivialising an important problem by people who insist on worrying about the symbols and not the problem behind them. I agree strongly with the noble Baroness on that point.
The position was reduced to total absurdity some time ago when a young Liberal of my acquaintance named Guy Chapman was always referred to as, "Person Personperson". But this is a serious matter and we were right to be rebuked by the noble Baroness, Lady Ewart-Biggs, for perhaps indulging in a little too much hilarity; but generally we have dealt with it as a serious matter. We have had many serious contributions to the debate and we are extremely grateful to the noble Baroness, Lady Lockwood, for introducing it.
Noble Lords in this House, and men everywhere, need to listen to debates of this sort, because I believe we can always learn an enormous amount—even those of us who believe we are reasonably liberated. Even those of us who believe we are on the side of the angels nevertheless from time to time receive a nasty shock when we realise that we are perhaps being patronising or not able to understand the full depths of the problem as it is seen by the women around us, even if we communicate with them particularly well.
One of the comments that I wish to make today to all noble Baronesses who have taken part—all of whom have taken their seats in this House because they are outstanding people—is that we may not have emphasised enough today that some of the major problems in our society in relation to women taking their proper place in society have nothing at all to do with women of first-class ability because, on the whole, they do eventually get there. It is the second-class women who find it difficult to compete for places with second-class men. That is an area we ought perhaps to explore in more detail at a later stage.

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I have two particular subjects on which I should like to dwell for a minute or two. First, I have a tremendous bee in my bonnet—and this matter has been touched on very well by the noble Baroness, Lady Platt—about the dreadful lack of women in engineering and science in this country. As she rightly said, we are coming to a time when we shall be extremely short of talent. We are already short of talent in engineering. It is absolutely criminal that our education system is in a state where it recycles a lack of expertise in engineering. We have the awful problem of there not being enough women physics graduates to restock our educational system to bring on more women graduates. Although co-education may be making some impact on that, it is worrying that some of the statistics indicate that no real breakthrough is taking place. I welcome very much what the noble Baroness said about the industrial end of breaking that cycle.
The other subject on which I wish to touch is the question of parliamentary candidates. It is a matter of which I have had experience and I thought perhaps it was worth while putting that experience into this debate, not on behalf of a particular party but on behalf of all political parties. I was for three years the chairman of my party. On two occasions at general elections I was responsible for fielding candidates on behalf of the Liberal Party up and down the country. I spent quite a lot of time trying to encourage women to stand as parliamentary candidates—trying to get them to go on the list of prospective candidates.
It is my belief that apart from certain pockets—this may be more or less so in various parties—there is not now a lot of overt discrimination against women becoming parliamentary candidates. The problem is finding the women who are prepared and able and have the experience to go on those lists. As we have heard so often this afternoon in relation to careers in industry, it is the discontinuity and breaks in the experience pattern at crucial times which affect women. That is true not only of women in industry, trade and commerce but also in politics.
I was taken to pieces by the 300 Group on one occasion a couple of years ago. I really must pay tribute to the group for the work that it is doing in trying to encourage women to come forward into public life and particularly to become candidates for Parliament. What I had not realised and what it told me very firmly was the psychological barriers to women coming back into politics after they have spent time at home rearing their families. There is a sense that somehow they are not capable of standing up and making speeches and simply cannot pit themselves against men. It is a purely psychological barrier but it is something through which they need to be helped. I believe that the 300 Group is going a long way towards helping them. Long may it continue.
As my noble friend said, the true discrimination is that intangible discrimination. It goes deep into our society. It starts in our homes and with our parents. Male chauvinist pigs are created by mothers who say, "Leave that. I'll do it". Conversely, the lack of girls' knowledge of the physical sciences and, say, do-it-yourself, is created by fathers. They refuse to accept that girls are as capable of doing jobs about the home
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as boys. It is at that level that so many discriminatory effects start.
We need to get to the stage where children at an early age take it as normal, whatever sex they are, that they will share the work in the home. Only when we get that psychological change in our society will married couples begin to share the work properly and recognise that, although women have a particular role in bringing up children, the chores about the house ought to be shared equally. The man should not come home, do a bit of washing up and feel that he has done something remarkably good. To an extent I think that all the men in this place have probably done that from time to time.
We need education for household chores. I commend to your Lordships a splendid article by Katherine Whitehorn in the Observer on Sunday, which said that if only we had education for households as we have education for sex, life would be a lot better for all concerned.
I do not propose to make a conventional winding-up speech. We have heard an awful lot of extremely interesting and important speeches this afternoon. I hope that we can all learn from them, and I hope that this is a subject that we shall come back to over and over again. As has been said, it is important for all of us.
4.56 p.m.
Lord Wedderburn of Charlton: My Lords, I shall do my best from these Benches briefly to respond to a most important debate and not trespass on the time of the noble Lord the Minister. First, I join in the thanks offered to my noble friend Lady Lockwood for introducing this Motion for short debate, especially with her wide and profound experience of the problems. Indeed, we have heard also from her successor in the chair at the Equal Opportunities Commission, the noble Baroness, Lady Platt.
One of the last acts of my noble friend Lady Lockwood as she left the chair at the commission was, I believe, to bring into being the reformed publication which is now called Equality Now rather than the more mundane News of the Commission, as I think it was. From what has been said today, why should we not have equality now? In the circumstances of the points made by speakers in the debate, the burden of proof has surely moved on to those who resist equality at any point of the social, economic or political compass. Even The Times last year, speaking about the famous Martin Roberts survey on the 1980 position of women in employment, said that there had been advances but that the advance was too gradual to give any room for complacency. If The Times is of that view, we should stir everyone, including ourselves, into greater action.
May I touch upon points looking outward and then two points looking more domestically inwards? Of the points looking outward, my noble friend and other speakers have touched upon our position in the European Community, and especially of course the Government's apparent dragging of their feet on the issue of parental leave where we seem to be a long way behind our partners in the Community. I put that in the context today of asking the Minister what the Government's programme is for the positive action

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policy to which they committed us as one of the member states which signed the recommendation of the Council of Ministers on 31st December 1984.
As I understand it, we have agreed to adopt a positive action policy on equality for women—positive action on awareness of the opportunities and need for greater equality, on the dignity of women at the workplace, on diversification of vocational choice, on guidance and counselling services, on promotion of women in professions and sectors, and so on. All that must be new because the preamble to the recommendation states that it is agreed because existing legal and social provisions are inadequate.
The Government should be telling us today not merely about parental leave but about a wide variety of matters. I hope that on that aspect, too, although it is not quite in the same frame, that the noble Lord the Minister will respond to my noble friend Lord Hatch. My noble friend Lord Hatch brought before your Lordships a situation which, in terms of civil liberties, seems to me little less than scandalous. Is it really true that there is automatic deportation of wives? Will the Government continue with such a practice?
Perhaps I may look around domestically as it were. Although, in the light of the many points that have been made, it is difficult to raise any new matters, perhaps I may touch upon some points relating to employment and some relating to education. In the debate last week, which covered a similar area, my noble friend Lord Monkswell said that, speaking as a manager, he certainly saw the need to promote the training and education of young women as well as of men in the field of technology and the like. However, he also said that those in charge of such programmes must make sure that this will not be used as a source of cheap labour, driving down the wages and salaries of those currently working in the industry.
I think we had better face the fact that male prejudice certainly exists and it is not justified by the second belief, whether it be a prejudice or a fact, that working women are sometimes used as cheap labour. For a programme of advance, it is very important to face the fact that there is that belief and, to answer it, if it be not true, by showing it to be not true, or, if it be true, by removing that obstacle to equality.
In the employment field there is great need for further movement. As the noble Baroness, Lady Seear, said, the Sex Discrimination Act and the Equal Pay Act leave out very many subjects. This is not in any way a party point. I am very proud of my party for being in Government for most of the time when those Acts were passed. Nevertheless, they leave much to be desired and we must move on and not merely let the forces of the market cope with women workers. That is especially important because, as noble Lords and noble Baronesses have pointed out, 40 per cent. or more—possibly even by this year 45 per cent.—of the workforce are now working women. Two-thirds of them are married.
Let us take the, new jobs that have been created. I pause to say that any new job is good rather than bad. Nevertheless, let us look at the Government figures. If we take 1984, we realise that 187,000 of the new jobs created were part-time jobs, mainly with women
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workers and, to a very great degree, jobs with depressed pay.
I do not wish in any way to criticise my noble friends and the noble Lords and Baronesses who have spoken about professional careers. That is a very important matter. However, I wish to concentrate upon what the noble Baroness, Lady Seear, called the ghetto of under-paid women workers. For them, too, there are no nurseries for the under-fives as there are in some countries across the Channel. The breaks and the discontinuity in working life for them are perhaps more difficult than ever.
This area of partly, but not solely, part-time women workers, many of whom are married and who have downward mobility in the labour market when they come back after rearing children, constitutes, at a conservative estimate, at least 3 million: 2·2 million in the wages council areas and many of the others in sectors such as contract cleaning.
The ACAS report of 1981 on contract cleaning found 200,000 women working less than 29 hours at very low rates indeed, both in terms of rates of wages and in terms of earnings. Some of them were supported to some extent by the fair wages resolution, which insisted on minimum conditions. Others had Whitley Council rates that were observed by slightly different routes. Of course the 2·2 million workers in wages council industries have at least the minimum rates of the wages councils.
I know of many faults and criticisms—indeed, justified criticisms—of some wages councils. Nevertheless the fact remains that those minima are there. What the Government are doing across the board is to take those minima away. The fair wages resolution has been rescinded. Wages councils will be either abolished or kneecapped in the coming consideration of Government policy which has been announced. The Central Policy Review staff suggested that they should not be abolished but only reformed by being severely restricted, and look what happened to the CPRS. We fear the worst.
Women who are weak, who are vulnerable and who are under-unionised are the first victims of this insatiable drive for lower wages. My noble friend Lady Ewart-Biggs commented on the link between the lack of nursery places and the Government's policies in relation to local authorities, including rate-capping and the like. Across the entire area of Government policies in regard to employment, the drive for lower wages in some areas of employment is leading to the removal of the statutory props that kept up certain minima—one might even say certain minima of decency.
It seems to me that that is something to which, in this context, this Government have to give a special answer: not their general answer about market forces but an answer as to what is to happen to those women workers in wages council industries and in contract cleaning who have taken a more than 20 per cent. wage cut in the last year or so.
Let me say one word about education and then make one final comment, otherwise I shall trespass on the Minister's time. First, the educational system that we have is very unfair. I do not believe it to be a true record of the talent of the girls who leave school at 16

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and do not go into Youth Training Scheme (which is the only statistic we have since the Government here, as in so many places, have changed the survey basis) that those girls include 58 per cent. who have not one O level pass at C grade or above. I do not believe that to be a true record of the talent of the nation.
From a Written Answer which my honourable friends in another place obtained last week, it is now possible to calculate that the percentage of sixth form school leavers from maintained schools who go to universities and polytechnics is the same today and the percentage of sixth formers who go from independent public schools is also more or less the same, from now back to 1974–75. In other words, the class structure of our educational system remains, and that hits working class girls more than anyone, in the spread of talent, in the student force.
Finally there was one point which my noble friend Lord Hatch made with which I should like to conclude. It is this. We are not discussing a matter of sectoral or special interest. Women's rights are a matter for men as well as women. Women's equality is a matter for the nation. Unless we face the issue and promote equality now, we shall be doing damage not only to men and to women but to our children and to the nation's future.
5.8 p.m.
Lord Glenarthur: My Lords, conscious that this has been a wide debate and time is not exactly on my side, I nevertheless join in thanking the noble Baroness, Lady Lockwood, for giving us the opportunity to consider today the important questions of the role of women in economic and social affairs and in public life. As she said, women make up slightly more than half our population; the contribution they do, and could, make to the life of the country is rightly a matter of the greatest importance to us all. And it is perhaps particularly timely that your Lordships should have an opportunity to consider these matters in 1985, the year which marks the end of the United Nations Decade for Women and the tenth anniversary of the passage of the Sex Discrimination Act 1975, as the noble Baroness, Lady Lockwood, mentioned.
I should like to begin my remarks by reaffirming the Government's belief in a policy of equal opportunity for all and their commitment to the creation of a society in which every individual is able to play a full part.
The role of the law in the creation of such a society is an important one. Anti-discrimination legislation underpins the right to equal treatment. Without statutory backing the assertion of rights provides no guarantee of progress. The law must declare and establish the minimum requirements of behaviour needed to ensure that all our people have equal scope to participate in every important aspect of life. It must provide protection against discrimination. In 1985 this statement of the role of the law is, I believe, very widely accepted; but it was not always so. Ten years ago enactment of the Sex Discrimination Act and the implementation of the Equal Pay Act 1970 represented the culmination of a long campaign to secure effective laws against sex discrimination in this country. That campaign is one in which the noble
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Baroness, Lady Lockwood, played a leading role and I think she will agree that the wide acceptance of the legislation, and of the Equal Opportunities Commission, which was established by the Act, and of which she was the first distinguished chairman, and my noble friend Lady Platt her distinguished successor, is a measure of the extent to which attitudes have changed over the last 10 years.
The Sex Discrimination Act and the Equal Pay Act provided for the first time legal protection and a legal remedy against the kind of discriminatory behaviour which previously had all too often frustrated the ambitions of women to play a full and active part in public life. For the first time women had the right to challenge in our courts actions which denied them an equal chance at work, equal treatment in education, equal access to credit facilities and equality in the provision of other goods and services. Much has changed in 10 years. Who now finds it easy to remember that in 1974 employers could advertise a job and say, "Only men need apply"? However, as has been demonstrated this afternoon, there is still a long way to go before women are equally represented in public life and in our economic and social institutions. The Sex Discrimination Act has effectively increased women's freedom to take their full part in public life and has provided protection against actions which, consciously or unconsciously prevented them from doing so.
It is encouraging that women are increasingly making use of their freedom. We must surely welcome that and hope that this process will continue, not just because it is self-evidently right that women should have equal access to any of the benefits which our society can provide, but also because they also have the right to contribute equally to society. Women have been, and, to too great an extent still are, an under-used source of talent and potential. The full use of their potential will benefit not only women as individuals but also society as a whole.
Already, of course, women play a vital role in the economic life of the country. Let me illustrate this. Women now comprise some 40 per cent. of the civilian labour force. Twice as many married women were in, or seeking, jobs in 1981 as in 1951. The United Kingdom has 60 per cent. of women aged up to 59 in the labour force—the second highest female participation rate in the European Community. Between December 1983 and December 1984 the number of women in full-time jobs increased by 14,000 and the number of women in part-time jobs by 187,000.
But while these overall figures are encouraging, and attitudes are changing, as the noble Baroness Lady Ewart-Biggs suggested, it is disappointing, for example, that women are still concentrated in the less well paid and less responsible jobs. Only 16 per cent. of our nation's managers are women. Further progress depends upon the actions of not only the Government, who can only build the foundations for progress, but also employers, trade unionists, educationists, parents and individual girls and women. For their part the Government have provided quite a lot including a sound legislative framework. My right honourable friend the Secretary of State for Employment has designated training bodies to run special courses for

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women wishing to return to the labour market or enter non-traditional occupations where a need for such training is established. There are now over 100 designated bodies.
We have supported the current Women into Science and Engineering campaign by the Equal Opportunities Commission and the Engineering Council. We are improving the training of all our young people to give them a better start in working life. We have introduced a package of training and employment measures to help both men and women find work, and some of these—open tech, part-time job release, part-time job splitting—are of special significance to people with family commitments. That was a point raised admirably by the noble Baroness, Lady Seear. In addition, the Manpower Services Commission has a small but valuable programme of special training for women.
But a major part in promoting equality of opportunity in economic affairs has to be played by employers and trade unions, as the noble Baroness, Lady Robson indicated. It is no coincidence that some of our most successful companies have taken equal opportunity initiatives. British employers have one of the most committed female workforces in the world, but there has been a tendency to under-use this asset. As in other areas of economic life, our attitudes are holding us back. It is time more employers and trade unions recognised that there is virtually no job which a woman cannot do. If they can do almost any job, I recognise the force of the argument put forward by the noble Baroness, Lady Lockwood, about taxation and the tax treatment of married women. I recognise that in a number of respects the present system does not give equality of treatment between married women and married men. In this year's Budget my right honourable friend the Chancellor of the Exchequer announced that he would be publishing a Green Paper on the reform of personal taxation. That will set out proposals for a new system under which everyone, male or female, married or single, will have the same standard tax allowance. Married people without enough income to use up their allowance will be able to transfer the balance to their partner. Rather than say more now, it would perhaps be best to await the Green Paper.
My right honourable friend the Secretary of State for Employment has approved the Equal Opportunities Commission's code of practice on employment, devised under the auspicies of my noble friend Lady Platt, which came into operation yesterday and which she described so fully. The code does not extend or add to the law, though it is admissible in proceedings under the Sex Discrimination Act before an industrial tribunal. My noble friend described the code. The second part looks at the role of good employment practices in promoting equality of opportunity. It encourages employers, as the law permits, to train their female employees for positions which are at present predominantly held by men and to consider the advantages of flexible working patterns such as part-time work, adequate personal leave arrangements, child care facilities and job sharing as a means of providing continuity of employment. It also covers non-discriminatory recruitment—another point raised by the noble Baroness, Lady Seear.
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The new code has the full backing of the Government and we believe that it can make a real contribution to improving the position of women in economic life. I should add that the Government recognise the value of example and have themselves taken initiatives in their role as an employer. My right honourable friend the Prime Minister announced at the beginning of last year a programme of action on women in the Civil Service—described by the noble Baroness, Lady Lockwood, as an enlightened employer—consisting of 70 items covering the whole spectrum of equal opportunities issues; for example, expanding part-time working and job sharing, giving publicity to departmental child care schemes and increasing flexibility in working hours. The Government hope that employers generally will follow this good advice and, we believe, good example.
The noble Lord, Lord Wedderburn of Charlton, talked about education. If opportunities at work are to be fully taken up and we are to gain the full benefits of women's participation in the life of our country, we must have women educated, trained and willing to enter fields of activity where traditionally they have been under-represented or not represented at all. It is important, therefore, that women take full advantage of the educational opportunities available to them. I am happy to say that increasingly women are seeing the value of gaining educational qualifications and are closing the gap with their male contemporaries; indeed, in some cases they have overtaken them.
One area where women continue to be poorly represented is in the field of science and technology. This is detrimental both to women, who are closing off many possible careers, and to the nation as a whole. We recognise that we are losing a considerable amount of potential in these fields, a loss which frankly we can ill afford. We should like to see many more girls studying physical sciences and technology in school, and continuing these studies in further and higher education. We would like to see all pupils, including all girls, receive a broad and balanced science education and an introduction to technology in the compulsory years of secondary education. This can lead to the sort of advances that my noble friend Lady Platt and the noble Lord, Lord Tordoff, would like to see involving women in the engineering field.
Turning now to public life more generally, the Government are eager to increase the representation of women on public bodies. These were points raised by the noble Baroness, Lady Robson, and the noble Baroness, Lady Lockwood. Every effort is made to ensure that a good field of candidates, regardless of sex, is considered by Ministers for appointment on the basis of their qualities, abilities or experience. Where people are in a position to make known to the Government suitable candidates, I hope that they will do so. We need to know those who are willing to accept appointment. I can assure them that nominations of women are particularly welcomed and carefully considered.
My noble friend Lady Gardner mentioned the conference in Nairobi. As for the previous conferences in Mexico and Copenhagen, voluntary organisations will not be represented on the United Kingdom delegation to the Nairobi conference, but the Government have had the opportunity to take into

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account the views of those organisations which were brought together by my noble friend Lady Gardner into working groups to look at various subjects. In addition, the non-governmental organisations will be meeting in Nairobi a week before the conference and during its first week, and will have the opportunity to discuss matters as they arise with members of the delegation, who will themselves be familiar with the views of voluntary organisations.
As regards ratification of the United Nations Convention on the Elimination of all Forms of Discrimination Against Women, about which my noble friend particularly asked, in due course the Government hope to be able to announce their conclusions on whether the United Kingdom should ratify the convention; and I note the points that my noble friend made.
I turn to some specific points on employment. First, the noble Baroness, Lady Lockwood, asked why women are still being paid lower rates than men in some cases. Improvement depends largely on women moving into higher-level occupations, and this in turn depends on changes in the attitudes of women themselves, their employers, and their families. The noble Baroness and the noble Lord, Lord Wedderburn, expressed concern about the proposed abolition or reform of wages councils; in fact, the noble Lord, Lord Wedderburn, used the rather emotive term "kneecapping" of wages councils, saying that that would hit women particularly hard. There is a difference between equal pay and minimum pay. The Government are fully committed to equal pay and have recently amended the legislation so that women with just claims to be doing work of equal value to men can receive equal pay, but it is not in the interests of either sex if employers cannot afford to take them on.
So far as equal pay for work of equal value is concerned, the new regulations came into operation on 1st January 1984. So far only one case has been decided following an investigation by an independent expert. The tribunal found that a cook was entitled to pay equal to that of a male craftsman also employed by Cammell Laird. Following this case there have been press reports of employers conceding equal pay for work of equal value without claims being taken to industrial tribunals; and the number of such cases is growing.
As regards parental leave—and naturally I am having to constrain my remarks in the interests if time—I note the points that were made by the noble Baroness, Lady Ewart-Biggs, by my noble friend Lady Platt, and indeed by the noble Lord, Lord Wedderburn. However, as the Government announced in the debate on 25th March, a consultation exercise seeking the views of interested parties in the United Kingdom is currently in progress and comments have been requested by the end of May 1985.
So far as nursery places are concerned, participation in nursery education is at its highest-ever level of 42 per cent. of three and four-year-olds. Government expenditure plans allow for a slight increase in that rate over the next three years. The number of day nursery places provided by local authorities increased
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from 24,552 in 1974 to 28,630 in 1983, which is quite an encouraging improvement. I do not have time to go into many of the points raised on social security. I note the point that the noble Baroness, Lady Lockwood, made about the invalid care allowance. My noble friend Lady Platt made a point about pension age. That is subject to one of the reviews being undertaken at the moment by my right honourable friend the Secretary of State for Social Services.
This afternoon we have discussed the role of women in economic and social affairs. I do not want to leave this topic without giving explicit recognition to the importance of the role of those women who choose to play their part at home and among their families. Their role is naturally a demanding one, and I need not elaborate on it; but it is right that they, too, should be afforded the very real recognition that they deserve.
Returning now to my main theme, I have reaffirmed and illustrated in practice the Government's continuing commitment to equality; and I have recognised that there has been substantial progress, both in the acceptance of the justice of women's claim to equal rights as well as in moving towards attaining them. But the Government also recognise that there is still a long way to go. Further progress will depend on an increasingly wide recognition by those outside Government that they cannot afford, and society cannot afford, to neglect the potential of women. We look, therefore, to teachers and parents, to employers and trade unionists to work together in examining their preconceptions about the role of women and in dismantling unnecessary obstacles to real equality. The Government accept their responsibility here and will continue to play their part.
5.25 p.m.
Baroness Lockwood: My Lords, I am very grateful to all noble Baronesses and noble Lords who have taken part in the debate this afternoon on such a wide range of issues, all of which were very pertinent to the Motion which we were considering. I welcome the equal participation of men and women in the debate because we were talking about equality between the sexes. Therefore, it is very important that if we are successfully to deal with the problem, both men and women should apply themselves to the problems of this subject and work together in a partnership, understanding each other's problems.
Some very positive remarks have been made in the course of this afternoon's debate, and I hope that they will be noted not only by Government departments but also by all those who are responsible for policy-making, because it is a matter that goes across the whole range of policy-making. I understand the time constraints on the Minister and I welcome his reaffirmation of the commitment to equality. However, may I say that a reaffirmation of commitment to the principle is not enough. As has been shown this afternoon, there are all sorts of detailed aspects which still need a very positive response. No reference was made to the question of the position of women bringing husbands and fiancés into the country.
The Deputy Speaker (Baroness Llewelyn-Davies of Hastoe): My Lords, the time allowed for this debate

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has now elapsed. Does the noble Baroness wish to withdraw her Motion?
Baroness Lockwood: My Lords, yes. I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

The Rural Areas: Integrated Policy
5.28 p.m.
Lord John-Mackie Lord John-Mackie rose to call attention to the need for a policy for the rural areas which would take account of the needs of farming, forestry, industry and the environment; and to move for Papers.
The noble Lord said: My Lords, in moving this Motion I should like first and foremost to say that it is a very large subject and we have two-and-a-half hours in which to discuss it. I see names on the list of speakers who know as much, if not more, about it as I do. However, I shall do my best to keep within my time, which I understand is about 15 minutes, and I shall try to concentrate on farming and industry in the countryside. There are other noble Lords present, including the noble Lord, Lord Gibson-Watt, who I am sure will speak about forestry, and there are certainly environmentalists present. I think I saw the name of the noble Lord, Lord Sandford, on the speakers' list.
However, as regards the environment—and I have made this point before to noble Lords—it is a gross exaggeration to use such expressions as, "the devastation of the countryside" or, as the Economist put it this week, "the mutilation of the landscape" by farmers or, for that matter, by foresters. We should deprecate those expressions, which do not add up in any shape or form. Of course there are black sheep here and there. The other day I motored up the middle of the county to Norwich and back down the coast through Suffolk. Here and there I certainly saw large areas which had been cleared of hedges and in some cases trees, but I came to other areas, such as the area which is the subject of a review by the local farmers, where there were more hedges and trees. The differences, I think, enhanced the situation rather than anything else. It is just not the case that the landscape has been mutilated. Changes there have been, of course, but in the eyes of some people these changes are for the better. Often criticism arises simply because people do not like change. It is quite extraordinary how conservative we all are, with a small "c".
So far as forestry is concerned, I just make the one point that visits to our commission forests and private forests are well over 20 million a year. That speaks for itself, and I shall leave it to someone else perhaps to expand on it.
Now what have we to worry about in the rural scene as we see it today? Do we have to worry? Some people are perfectly satisfied with it, but I do not think that that is the general case, especially over the last few years where in the countryside we have come under considerable criticism.
Over the years rural communities in Britain—and they were mostly wholly agricultural—and their immediate ancillaries, the miller, the blacksmith, the
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joiner, and many countryside craftsmen have provided not only a large proportion of the urban population's food but also a reservoir of people to man the growing industries from the Industrial Revolution until fairly recently. Of course, the large unemployment situation has altered that.
All over the country these communities were entities in themselves, centred on the village. They had their own food, churches, schools, pubs and post offices, and they provided their own entertainment, such as football, cricket, local dramatics, picnics, fêtes and what have you. I have worked and lived in these rural communities for the last 59½ years, to be exact, and I have seen the changes taking place which have totally altered the situation in the countryside.
I lived and worked for 32 years in the north-east of Scotland, from 1926 to 1958. I started work at the age of 17 in 1926. I ran, with my two brothers-in-law, a farming business in North Lincolnshire for 21 years from 1947 to 1968. We were absentee farmers, but I went down quite a lot, I stayed there quite a lot, and I even played for the village cricket team—mostly scythe strokes and not a straight bat. I have farmed where I now live since 1953, and I have lived there since 1958. So I have a fair experience of varied rural communities.
What are the changes? Let us take the farms first. The two major changes there are the decline in tenant farming and the increase in the size of farming units caused by amalgamations all over the country. I should like to give some examples. I was brought up in the centre of Aberdeenshire at my father's farm, which was a 320-acre farm, where he brought up six of a family. Over the years it was certainly a unit in itself, but it is now amalgamated to make a 600- to 700-acre farm with a neighbouring farm, and my nephew farms there. The two neighbouring farms are also amalgamated. My other nephew farming in Aberdeenshire has two big farms of 400 acres each, coming to 800 acres. When I left Aberdeenshire and went south of Aberdeen the farm that I went to first was 500 acres, my father increased it to 700, and my son has now increased it to 1,000. And so I could go on.
When I went to Lincolnshire we had 1,000 acres, consisting of four farms. Before we left it there were seven farms and 2,000 acres. That is the picture of what is going on all over the country. What effect has this had? First, in my opinion—and having admitted the glasshouse, I can now give an opinion—is the decline in the number of farmers and, at the same time, because of new technology in farming and the emphasis away from horn to corn, a massive decline in the number of farm workers.
I can give two examples. On the farm I started on, a 220-acre farm in Aberdeenshire, there were five men and me, and now there is only one man. Where I now farm, when I came there first I built up quite a business with pigs, poultry and one thing and another and we had 11 men, and now there are three. These two examples give your Lordships the picture of what is happening.
There is great emphasis that we should return to horn and away from corn, but I doubt whether this will make much difference. It may help the aspect of the countryside. There will be more pasture and maybe

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more hedges for shelter for stock, but it will make little or no difference to an increase in the labour force. Before the war a man and his wife, or a man and a youth, were doing a good job of work if they looked after 40 cows, and even then they required help with the milking, whereas today you will get one man who will look after 120 cows almost by himself. That is the picture there.
People, especially young people, drifted to urban areas, or because of the coming of the small, cheap car, they travelled long distances to find work. The centralisation of education did away with the village school. I do not know whether our children are any better educated because of this. Noble Lords may look at me, a product of village schools, and say, "Yes", but I sometimes wonder.
Churches have suffered as well. In both villages I worked in in Aberdeenshire there were two churches. There is now only one in each, and of the other two one is now a garage and the other a potato store. It is extraordinary that in Lincolnshire all the villages had a church, a vicar, a vicarage, and everything, but before we left there one vicar was looking after three churches. In the village where I am now, the village of Nazeing, the Lord Chancellor cannot find us a vicar, although the church is still there. That is the picture.
Now the supermarket in the nearest town becomes a shopping centre, and away goes the local shop and usually with it the local post office. We have just lost ours in our little village this last year. The importance of the post office is illustrated by the story about the late Gordon Selfridge. He went shooting in Aberdeenshire and stayed at the local pub in the village of Tomintoul and got talking to the local shopkeeper. They discovered that they sold the same things. The shopkeeper said to Mr. Selfridge, "Of course, you will have the post office". Selfridge said, "Good Lord, what would I do with a post office?" The shopkeeper said, "Oh, its no use without the post office". That is right in a village community.
I could go on, but the long and short of it is that the countryside has been urbanised and I think, as do many others, to its detriment. If we are agreed that it would be a good thing to get a million or so more people back into the countryside, is there the will to do it, and how? Agriculture, the main source of employment at the moment, can only do so much. Limiting the size of farms could make a big contribution not only to employing more labour, but as a social contribution. Four or five families with 300 or 400 acres each make a much better social structure than one man farming 2,000 acres, and more so 20 or 30 farmers with that acreage instead of a farming company with probably 12,000 to 20,000 acres, or even more.
I have here a record of a debate on the subject. It was generally agreed there that socially it would be a good thing. There was some doubt whether there would be a great increase in employment, but what was agreed was that it would require drastic fiscal action by way of taxation or some statutory measures to achieve it. I doubt whether there is the will to do either. What I know is that we would have a better countryside if we could do that.
If I may digress, I was interested in the noble Lord, Lord Trefgarne, telling us about what we are doing in the Falkland Islands; breaking up the estates there into smaller farms in order to make a better social structure. What is good for the Falklands is surely good for this country as well. I should add that the question of limiting the size of farms is very much tied up with an increase in the tenanted sector of the industry as well, but I shall leave that for another day.
What else could agriculture do to help to employ people? There are about 220,000 farms in the country. I am pretty certain—I have been doing a survey of old barns and things recently—that probably about 50,000 of these farms have spare space which could be let to one-man, or two-man, industries. There is certainly a demand for this, as anybody who has consulted CoSIRA would have pointed out to them. I must say that CoSIRA is one of the semi-statutory bodies which does a good job in the countryside, and if anybody likes to consult it, it is a great help on that side of the question. I have heard people say that having other business on your farm creates a situation where the farm is not your own. My landlord took that attitude. I think it is a slightly selfish one, but probably an understandable one. I am sure it would be an added interest on a farm and as well could create quite a lot of jobs in the countryside. It could probably create 50,000 jobs if everybody took it up.
There is much else that could be done in the villages to create industry, but I will leave that to some other speakers. I understand that my noble kinsman has ideas there. There is one thing that is certain; we will not attract people back to the countryside unless we have the proper amenities, particularly in the remoter areas. This includes housing. No young people who have sampled decent housing in the towns are going to go back to hovels in the countryside. Of course, we must have transport, pubs and the post office, as I mentioned earlier.
It also includes treating these as remote areas. At the present moment, the Government have a scheme for flat-rate travel to universities. What is the use of that if the university is 100 miles away, which in many cases it is?
Apart from keeping the environment of the countryside in good order, farmers could do a lot to make the countryside more interesting. They could have open days on the farm; provide picnic sites; take advantage of being allowed to have five caravans on a site without planning permission; or give a field for weekend caravan rallies. I do this, and the caravan clubs have their members well controlled; they leave the place tidy and behave well when they are there. We have no trouble, and these people enjoy a weekend on the farm. As we all know, there is a great demand for accommodation for horses. I think it now has the awful name, "horsiculture". To all that, you can add the selling of produce. All of that would add up to a more active countryside, and it would bring urban and rural populations together, which would be good for both of them.
Before I close, I must ask the Government what attitude they are taking. I have recently read the reports of two meetings. I have them here. I have mentioned one already. One meeting was to discuss the limiting of the size of farms. The report of the other

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meeting is entitled, Where are We going?; The Future Use of Land. There is a Bill before another place on the future of youth in rural areas. There have been press articles, brochures from the NFU and the CLA, a new charter from the Countryside Commission, a speech by the chairman, Sir Derek Barber, and a headline in the press: "Cereal Quotas in Three Years; Up to 2½ Million Acres out of Production". What are we going to do with that 2½ million, if that is the case?
All of this is expressing in the rural community, in farming and elsewhere, where we are going and what the countryside is going to be like in the future. The Government have issued a consultation paper on the EC structures regulation. That is helpful but not nearly enough. I would therefore appeal to the Government to give some guidance—I suppose by a White Paper—to rural communities as to how they see the future. My Lords, I beg to move for Papers.
5.43 p.m.
Baroness Elliot of Harwood: My Lords, we are greatly indebted to the noble Lord, Lord John-Mackie, for initiating this debate, and also for his speech. I have often said that we have in the House of Lords the greatest experts on every subject. I honestly do not think that there are greater experts on farming than the Mackie family; and I include in that the noble Lord who is going to speak later. I have known them for many years and there is no doubt at all that they are some of the leaders and the most successful of the farming community.
My only criticism of this debate is that it has too wide a perspective. We can hardly talk about farming, forestry, industry and the environment in eight minutes. Therefore, I hope that the noble Lord, Lord John-Mackie will not object if I concentrate on just one or two things. First of all, there are the needs of farming. One cannot control a great many of these needs. The first is the weather. In the middle of hill lambing at home, it snowed every day last week. It is not much fun bringing lambs into the world in snow almost on 1st May. Then there is the other complication which comes from the fact that, with the EC playing an extremely important and I think very valuable part in our community and in the farming area, we are suffering very much from the fact that they will not make up their minds what they are going to do in the next year when they meet. They keep on postponing and postponing, and the plans which they postpone are very detrimental to us farmers because we cannot change our activities in a few weeks. We have to have at least a year in order to change. I hope the Government will continue to try to press the EC and the CAP people to make decisions and to stick to them.
In Committee D, which is the agriculture committee, we have said in almost every one of the reports we have put out that what we want is decisions so that all the farmers, whether in Britain or elsewhere in the EC, will know what is going to happen. I think that the latest document, which the noble Lord has referred to, which came out yesterday—the consultation paper on the implementation of the new EC structures—is extremely interesting, and much of it is very valuable. I should like to ask the Minister
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whether, in scrapping the capital grants schemes for less favoured areas, which have been running now for a considerable number of years, the Government will replace them by other regulations. I hope the Minister will ensure that the new regulations are as good and as helpful as the old ones have been. I can say that they really have been a tremendous help for any area, whether it is in the North of Scotland, the West of England, the South or any of the other less favoured areas.
As the noble Lord has said—he described it very vividly—the efficiency of our agriculture is terrific. All those figures which he gave us are fantastic. If you have ever had anything to do with it you will realise what it means to cut down from five men to one man, or whatever it may be. It is simply terrific. It is amazing to see the development of land improvement, and the amount of produce we have today compared with 50 years ago. In the 1930s we produced 30 per cent. of our food. Today it is 70 per cent. This is happening all over Europe.
All we have to deal with after that are surpluses. We always think of producing more and more and we do not think enough about how to sell our produce. Some years ago when I went to Brussels as a delegate, in discussion with the Agricultural Commission I asked which experts were considering how to sell the produce that we were all so eagerly producing. The answer was, nobody. In this country we have a great campaign to sell food for Britain. I do not know how successful it is. Different reports appear in the farming papers, and I read them, but I do not have any actual contact with them. The principle is right: find out how to sell the produce both to the advantage of the consumer and the advantage of the producer.
We have all been shocked by the famines in Ethiopia and elsewhere and the poor standard of living in the third world. Yet no one has found the answer, and our surpluses are either curtailed or thrown away or put into store. There has been no concentration, as far as I can see, on what to do in this matter. Yet in this year, 1985, with all the modern inventions, transport and communications, everything is there to help us. I should like to see far more concentration on selling and distribution. We have seen what the retail trade has done: the great firms like Sainsbury's, Marks and Spencer, and others. There has been a real revolution which has benefited everybody. Let us try to get a really good policy for selling and distribution as one of the priorities for the future.
The noble Lord has spoken about the environment, and many attacks have been made on farmers who completely alter the landscape by the production of cereals and other crops. I live in a country where this does not happen. The land is more valuable for raising sheep and cattle and the hills and the lowlands can be improved by means other than ploughing and cropping. So we are lucky. There has been considerable environmental change in the last 50 years. I have been farming for 51 years on the same farm so, like the noble Lord, Lord John-Mackie, I am talking about something I know about.
Although the amount of livestock has doubled more or less, much land has been lost to forestry. Perhaps "lost" is not a word your Lordships would like me to use, because everybody is so anxious and keen about

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forestry. I shall not talk about forestry because the noble Lord, Lord John-Mackie, was once chairman of the Forestry Commission and we have experts here. I live in the middle of one of the largest forests in Europe and miles and miles of conifers have not improved the landscape. The grasslands and hills used to carry sheep and cattle for centuries, but forestry is an important industry. Trees must be grown; so I leave it at that. I hold the view that there are ways and ways of developing forestry and in many places in the last 30 or 40 years much land and landscape has been spoiled, though that may not happen now so much.
The last matter I want to put into our policy concerns rural areas. The noble Lord vividly described issues of which I entirely approve. I approve strongly what he said about communities, about preserving the post office, rural schools and transport. All that is vital and is what we want in rural districts today. One of the troubles—though I do not know whether it is such in England; it certainly is in Scotland—is that the reorganisation of local government has made areas so huge that the representatives covering rural areas (of which I was one for 29 years in Roxburghshire) find their areas are so huge that the villages are forgotten because they have to concentrate so much more on the cities and towns. That is a great mistake and I hope the Government will take the advice of the noble Lord to ensure that the rural areas are not swallowed up because the representatives of the district councils and regional councils are so much concentrating on the towns, where much of the population lives. We must keep the rural areas going. I agree with every word that the noble Lord, Lord John-Mackie, said.
Of course it is a different kind of rural area. The noble Lord said so, and it is true. When I was at home years ago practically nobody had a motor-car. Today everyone has a motor-car and every boy has a motor-cycle. If they want to go into town to the discos or to the cinema, one cannot stop them, but we could make communities in the villages which would attract those young people as they did in the past. However, it requires the will, the concentration, as well as assistance and help from district and regional councils to keep rural amenities going. I should like to see rural areas, as the noble Lord has said, whether in the Highlands or in the English counties, lived in by people who love the country and their neighbours and who will not just come for weekends. I know that the Minister is as keen as any of us on preserving and using rural areas. He lives in one himself and knows all about it. I am sure that his efforts will be towards preserving and encouraging country life.
5.54 p.m.
Lord Walston: My Lords, I am certain that every Member of your Lordships' House and I believe everybody who lives in this country wants to see a prosperous countryside. We do not want to see deserted villages, empty schools or derelict churches. However, many people consider that this can be achieved only by a prosperous agriculture. If that were so, it would be a poor lookout for the countryside as a whole, because the choices facing agriculture are simple and clear, if we are to maintain the standard of living of those who are engaged in food production
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compared with those in urban areas. We could have the same number of people employed on the land as we do at present, but producing more, so that we can maintain the relative standard of living; but we do not want to produce more because we are already suffering from surpluses. Alternatively, we could have the same number of people producing the same amount as at present, but we could increase the return that they receive. That we do not want because it will mean that food will cost more. The third possibility is to have fewer people on the land, producing the same amount of food, and therefore having a rather larger slice of the cake. That we do not want because not only would it denude the countryside as it is at present, but it would also swell the numbers of unemployed.
Fortunately it is not on agriculture that the prosperity of the countryside depends. We all know that fewer than 3 per cent. of the total working population is engaged in agriculture. Even in rural East Anglia, for example, one will find few, if any, villages where even 10 per cent. of the working population in those villages is engaged in agriculture. It is misleading to believe that agriculture holds the key, much as I want prosperous agriculture. The key to rural prosperity does not lie with agriculture. The future of rural areas lies in industry, and that includes service industries. I am happy to see that the noble Lord, Lord Vinson, is to speak in this debate. I am sure we will learn much from what he has to say.
In the pre-Industrial Revolution days industry was largely based in the countryside—weavers, cottage industries, craftsmen of different kinds. Some lived in small and market towns, but many lived in the villages. It was only when we had the benefits of steam power and the railways that industry moved inevitably, for economic reasons, into the cities. That had appalling results for many of the people who lived there and appalling results for our countryside, with the destruction of many lovely areas, the creation of vast conurbations, and the poor living conditions and the crime, which in Victorian days were inevitable, and even today are not entirely absent. But now when we have 100 per cent. rural electrification, good communications and far more of our industrial products travel by road and by rail there is no need for industry for economic or social reasons to centre itself in the big cities. It can be just as efficient, and very often more efficient, when it is in rural areas.
However, this presents a grave danger for the countryside. The environmentalists will hold up their hands in horror at this suggestion, or some of them will. But in this context I remind your Lordships that far more destruction of the countryside has been brought about by urban sprawl, by the building of houses for those people who now protest about the desecration of the countryside, than by the ravages of the factory farmers we hear so much about today. Rural industrialisation, I believe, can be carried out provided we have proper, well thought out strategic planning.
For 10 years I was chairman of the East Anglia Economic Planning Council. One of the targets which we set ourselves was to do whatever we could—we did not succeed entirely—to ensure that there was a wide choice of employment within 30 or 40 minutes travelling distance from every village in the East

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Anglian region. That meant that certain villages—those which were strategically situated, those which perhaps did not have a very great call on preservation because they were particularly beautiful, those which had areas which could be hidden from the rest of the old village—should be designated as expansion centres where more people could live and where light industry and small factories could be set up.
To a certain extent that policy has been followed. It is not perfect by any means, but it has the sort of aim that I believe we should have in mind; we should establish small factories and offices, too, with modern telecommunications. There is no reason why service industries should not be sited just as well in rural areas and in villages as in towns and, in this way, give ample opportunities for a variety of jobs to the young people, the men and women and the girls and the boys of the villages to find all sorts of employment within easy distance of their homes without having to leave their own villages.
In order to achieve this, not only do we need this planning—strategic, wise and far-sighted; we also need good communications. We must maintain and improve existing bus services. I do not want to trespass upon future debates; this is something that we shall be discussing in due course. We must have good bus services and improved bus services and we must ensure that the village schools are kept open, even though at the present time they may have slightly below the normal quota of children going to them. That is the only way in which we can ensure that people will live and bring up their families there. And, as has already been said, we must have the village post offices. These are things which we have to do if we really want a live, vital, rural environment.
I suggest that there should be an improvement in the general administrative machinery and that there should be created at Government level machinery to co-ordinate the policies of a whole variety of ministries which are concerned with this—the Ministry of Agriculture, Fisheries and Food, of course, is one; the Department of the Environment is another. And it is good that they are talking rather more with each other now than they did at one time.
In addition to that, we must involve the Department of Education and Science, the Department of Transport, the Department of Health and Social Security, and the Department of Trade and Industry. All these have a vital part to play in keeping our rural environment alive and healthy. And, at Government level, they must work together as, in the days when we had economic planning councils, the officials from all those ministries met together and worked together. I hope that they still do so; I do not know whether they do. To have at the highest level of central Government such an administrative set-up would undoubtedly give a very great incentive to close co-operation at local and regional level.
I beg your Lordships to look on this problem of a healthy rural environment not as one of preserving the status quo, not as one of going in your motor-car from your urban or suburban house to enjoy the thatched cottage and the rilling stream, and not as something which depends solely on agriculture or even mainly
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upon agriculture; but as something which depends on a balanced and healthy industrial and economic environment in the countryside.
6.4 p.m.
The Earl of Onslow: My Lords, we must be very grateful to the noble Lord for introducing this debate. My only regret is that it was not either in official Opposition time, perhaps to allow more people to put down their names to speak, or, even better, in official Government time—but that is hoping for too much.
I think that I remember the noble Lord, Lord Walston, making a speech in an agricultural debate, drawing the attention of your Lordships a few years ago to the rural dereliction that there was in the countryside in the 1930s—broken down buildings, abandoned houses and really very genuine and rather unpleasant poverty. The problems of the countryside now are surely the problems of success. The success is in raising our production (as my noble friend, Lady Elliot has said) from 30 per cent. of our temperate foodstuffs to 70 per cent. on a much reduced land surface, with a working population reduced from 1½million to about 200,000 and, above all, with food or corn at about two-thirds of the price in real terms that it was in 1935. If all our industries could have done as well as that, we should make the gnomes of Zurich look like poverty-stricken Bangladeshis; but we have not quite done as well as that.
To complicate this thing further, India and China have now both become self-sufficent in food, which is something that we never thought we should see happen. The depopulation of the countryside is really what I think we are now all worried about. It is what has been in the mind, certainly, of French Ministers, with their much bigger countryside and a slightly smaller population than we have. They have been extremely worried about the depopulation of the countryside of France.
The surpluses that we now have to face are a very real problem and I do not know how we are going to do it. I do not think that any of us do. I think that it is reasonable to suggest that the Ministry of Agriculture and all of us in the farming community have become much more conservation-minded and, as the noble Lord who opened the debate has said, I hope that this conservation is not just the dead hand of preserving every single tree. It means cutting down trees and planting new trees and planting new hedges as well as cutting old hedges. It means producing new dry-stone walls as opposed to old dry-stone walls. It means that there shall be change, sensitive and sensible change in the shape of the countryside. Cobbett in his Rural Rides complained of the vicious encroachment of the Enclosure Acts and the planting of hedges. We are now all complaining bitterly about the removal of those same hedges.
My Lords, one thing that I sincerely hope my noble friend will do when he comes to reply is to make sure that the Government do not do what they did with milk quotas. First it was, "Produce, produce!" until the milk was sloshing about in vast lakes and then, suddenly, it was, "Stamp on it! Stop it!" That is not the way to treat any industry. It is a great pity that those milk quotas were not marketable. They could even

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have been bought in by the EEC; they could have used it as a reserve of milk or the milk could have been marketed. That would have produced much less upheaval than there has been.
The rural economy as a whole is the really important thing which I think we must talk about. The noble Lord, Lord Walston, was so right about the use of small industries in the countryside. This is what is going to give it a much greater vitality. Before the war, most farms had on them a blacksmith and there was a village blacksmith. You plodded your carthorse to the village blacksmith; you took it to the blacksmith's shop and he shod it; and then you plodded it back again. Now, what you do is to get to the telephone and speak to somebody who has a radio telephone in his van. He comes round with a couple of gas bottles and some spares and repairs your agricultural machinery. He is effectively an agricultural worker; certainly he serves the agricultural industry but he is classed as an industrial worker.
Large numbers of those agricultural workers have merely changed classification. One could also almost argue that the person who is producing nitrogen fertiliser really has strongly to do with agriculture and not with industry, although, in fact, his job takes place in an industrial environment. Near to where I live, which is in the suburbs (for want of a better word) there are old agricultural buildings, these are computer firms, dress shops and things like this. This surely is what we have got to do with our countryside.
A DoE circular—I cannot remember the number but it was a planning and advice circular issued in 1980: I am told it is No. 22—does take up this point and it encourages local planning authorities to use redundant agricultural buildings for sensible light industrial use. The use of electronics and electronic communication is going to make it very attractive for firms to set up small units which are easier to manage because people get to know each other and they are not in some vast conglomerate. It is going to be more attractive for everybody concerned to live in a small village rather than in a decaying inner city. So there is a human attraction as well as an economic attraction to it.
What I would really hope is this. I think we really must ask my noble friend and his right honourable friend to issue a White Paper to find out what the Government want from the countryside. The farming community can read the economic signals fairly efficiently, because after all it read the economic signals and, when it was told to produce, it produced. It can see that prices are coming down. I do not know whether your Lordships are aware that the price of winter barley at harvest is now about £92, when two years ago it was about £110 at harvest. That is a massive decrease. All the other prices, of course, have gone up. So we can read the economic signals. But I really do beg my noble friend as strongly as I can to recognise that we must have a signal from the Government as to what the Government want us to do with the rural economy.
Above all, they must plan not just for agriculture, not just for the Department of the Environment and not just for the water boards, or whatever it may be. I
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would hope that they would plan for the countryside as a whole. We must look at it in that way and not just at agriculture, at conservation or buildings. We must look at it as a whole; and, please, may we have a White Paper?
6.12 p.m.
Viscount Hampden: My Lords, this is a short debate. However, I do not think I have ever managed to speak in your Lordships' House for more than five minutes, and I do not intend to test my longevity record tonight. I am a landowner, but, perhaps more importantly, I act as my own land agent; and apart from a having a number of farms and a commercial interest in the property, my estate also owns the village, which consists of some 50 or 60 dwellings, the post office and the local pub. Thus I see every day at first-hand, and hear about, the problems of rural housing and employment.
This evening I want to touch on only two important points, to which other noble Lords have also referred. The first is the environment. I am lucky enough to live in an area of outstanding natural beauty, and thus am very much concerned with the environment. But I feel that a lot of environmentalists are very short-sighted about their objections to anything being changed at all. As an example, in my part of the world, which is East Sussex, in the 19th century there was a flourishing lime industry which gouged great tracts of chalk out of the Downs, churned up farmlands for clay pits and built tramways all over the place.
The industry is now virtually dead, but there are three important benefits that have come from it. First, the smaller chalk pits and clay pits have now become sanctuaries for wildlife—for birds, butterflies, and flowers. Secondly, the larger pits are being used for refuse tips, and in East Sussex we seem to have an awful lot of refuse. And thirdly, of course, the lime-workers' dwellings were built. They form the nucleus of the village, and now enable us to find reasonably cheap accommodation for agricultural and allied workers. Thus, to some extent, what was a prosperous 19th century activity has turned out to be an amenity benefit for the 20th century; and I think that should be borne in mind when considering the 21st century.
My second point concerns industry and small commercial enterprises in the rural areas, which were touched on by the noble Lord, Lord Walston, and the noble Earl, Lord Onslow. The noble Lord, Lord John-Mackie, mentioned CoSIRA, and I entirely agree with him that that is an excellent organisation. However, the trouble with small businesses is that they are liable to go bust—and I speak from my own experience of having started two of them in the country. One of them is bust, and I expect the other one will be by the end of the month. I feel, again, when considering land-use and when considering what one can do with the land, one should be able to think a bit "bigger" and not rely too much on these little workshops, which in fact run into economic troubles very quickly.
To sum up, I live in a village which we hope will continue into the next century as an economic rural environment, so that we are not all sitting around in our smocks being looked at by the leisure industry.
6.15 p.m.
The Earl of Radnor: My Lords, I, too, am very grateful to the noble Lord, Lord John-Mackie, for bringing up this enormously wide subject in a short debate. I, too, agree absolutely with the noble Baroness, Lady Elliot, that there is really no one more competent to do so. Both he and the noble Baroness told us how long they have been farming. I can only admit to 30 years, so I am really a beginner and probably should not be on my feet at all. This is a wide subject and people have tended to talk about various parts of it. I am going to try—and I have never before spoken in one of these short debates—just to touch on all the various facets which the noble Lord has included in his Motion.
I will start with farming. Farming, as the noble Lord outlined it, is probably in for rather a tough time. There are quotas coming and farmers feel themselves to be, and probably are, under a certain amount of pressure from the animal liberation or protection societies and from the medical people, who do not want the nation to eat polysaturated fats. Rightly or wrongly, there is also pressure from the environmentalists; but, above all, there is the threat of surpluses looming large in front of us. As the head of the Countryside Commission said—I believe somebody quoted him—we can perhaps look forward to quotas in a reasonably short time. He then asked: what will we do with everything that is left over? That is a very good question indeed.
One has heard all sorts of suggestions today, including some very good ones; though I would perhaps disagree with some of them. One which I would not throw out as a proper suggestion but one which it is perhaps worth thinking about is a tax on nitrogenous fertiliser, which might partly reduce yields without perhaps totally destroying profits. The trouble with the farmer today is that he has little to look forward to except reduced profits, and I think he will probably have to put up with that situation.
Forestry has been mentioned (though not here today) in relation to farming as an alternative crop. I wanted particularly to talk about forestry because I feel that this is a matter with which my noble friend on the Front Bench could perhaps help me. He might also be able to tell us something about it. My father was a forestry commissioner for many years; he became deputy chairman and, finally, chairman. I believe that in 1947 he was either a commissioner or the deputy chairman when the dedication scheme came in. I, of course, was forced to dedicate what woodlands were in my ownership; and quite rightly so. He, for his part, thoroughly enjoyed the job and always told me that he worked with very nice people and that trees grew so slowly that he would be dead long before all his mistakes were discovered. I am quite sure that he did not make too many, but I do think he might be turning over in his grave because there was a deal struck, as I saw it at the time, that in return for entering into a working plan with one's forest, one would receive grants. I believe that at the same time the Timber Growers' Association was formed. It was meant to be a loose co-operative affair which would help the marketing situation.
I have telephoned my office and they have managed
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to find out the kind of costs that have risen since 1947. One can hardly believe it, but the wages of a forestry worker have gone up from £4 to £97 per week, so far as we are concerned. Diesel costs have gone up by 500 per cent. since 1974. It sounds almost too much, but I believe it is right.
In their generosity, the Forestry Commission in 1977 put up our acreage grant from £30 to £42. It probably looks all right presented in that form, but everybody completely disregards the grants. I doubt whether the grants even cover the work that we have to put in on our working plan. I would ask my noble friend on the Front Bench whether he thinks that this is honouring that original deal that was struck, and whether he can tell us a little about the Government's policy as regards forestry.
The Forestry Commission have enormous acreages of timber and they have their rules about how to sell it at auctions and so on. But it is felt by many people that they are weak sellers in the market. On top of that, a landowner—not necessarily a large one—is facing an awful depression in the timber business. All the pulp mills are closed. We know that small timber is going to Norway, where fuel costs are lower, and it is then brought back here to make paper. In the South of England the only timber that sells is specialist timber, such as sports ash and so on.
Without being too bold, may I suggest that a degree of protection might be practised at home and that at least Government agencies should be exhorted to use timber a little more than they do now? One thinks of all the motorway fences which come from abroad. That would be a great help. It is hard to see precisely what the TGO does effectively now, but it might be useful if it were used for a generic advertising campaign. If you go to the west coast of Canada they will tell you—and they are absolutely right—that a laminated Scots fir beam is stronger and more flexible than steel and it is perfectly easy to fireproof it completely.
Having perhaps been a little awkward so far, may I come to the environment. The Motion implies to a certain extent that there is not enough Government policy. Having sat through the passing of the Wildlife and Countryside Act and, more recently, the Protection of the Environment Act, to which there were goodness knows how many amendments moved and in which the noble Lord, Lord John-Mackie, played a considerable part, I would say that the Government are doing very well indeed. "The environment" is a very broad term. You do not alter it in one day, and if the tiller is touched too often it will be rather a pity and of not much help.
I shall have to miss out industry, but I hope that the dreams of the noble Lord, Lord Walston, whose views I respect so much, do not come true in my part of the world. There are other ideas there, though on the whole I agree with the noble Viscount opposite that things do go "bust", and also that Victorian barns do not make very good factories. I should also like, almost inevitably, to mention fish farming which has grown to a certain extent, and to ask my noble friend on the Front Bench what is the Government's policy towards it. I have already declared my interest. Originally, everyone was keen on fish farming, but through a press campaign it is now thought to be a pollutant. There are

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rumours being put about that there is to be further legislation to do with effluents or the inflow of water, and I should like to know whether that is contemplated.
My time is up, but I should just like to say, so far as employment is concerned, that I began fish farming 14 years ago with 34 acres of surface water which was totally derelict and employed no one. I now employ 13 people on the farm, two lorry drivers and five in the factory where the food is handled. So at least it is a little help.
6.25 p.m.
Lord Davies of Leek: My Lords, we are all grateful to the noble Lord, Lord John-Mackie, for raising this issue. It has been an interesting debate and an example of knowledgeable expertise that is worthy of being read in Hansard by people who have not had the opportunity of listening to such splendid speeches. I shall begin with an axiom of John Ruskin and it is a categorical imperative. His famous sentence was, and is, "There is no wealth but life." The entire rural community can be redolent with happiness and life only if the amenities are present for the rural population to enjoy.
High in that prerogative lies the village school and the young married people who wish to live in a rural area. Rural schools serve the community, and for a young married couple to be attracted to a rural area their children must have the amenities to be brought up with a modicum of good education as a start in life. In 1948 a resolution was moved in the United Nations which stated that education of, at least, an elementary standard should be free to all the children of the world. Consequently, we should not neglect our rural schools and look upon them as of secondary importance. To attract young married couples to live in rural areas we need good schools.
I begrudge the cutting down of our railways. In snow, ice and wintry weather there is still nothing that can beat the railway as a method of transport. It is penny wise and pound foolish to reduce our railways. If it is asked how we are to pay for them, I would say that it is axiomatic that part of Britain's defence depends upon the railways and so the Ministry of Defence should combine with the Department of Transport to look at this problem not only as a strategic factor of vital importance for the moving of people in times of crisis, but as a necessity for the defence and security of the nation and, more important, for the happiness and convenience of people living in the rural areas.
Also, it is a sad fact—and I see this in many parts of rural Wales and rural Staffordshire—that village post offices are being closed down. One sees old-age pensioners trying to cadge a lift from farmers who are kind enough to take them to the nearest town several miles away, because there are no longer post offices in the rural areas. It is penny wise and pound foolish to be wasting money and extra grants on transport, without discovering how a local post office can serve a small rural community.
I was delighted to discover that about 85 per cent. of our schools are now equipped with even computer
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facilities, but most of those schools are not in our rural areas. I should like to see better standards in our village schools. I hope that the teaching profession—and I have been in every branch of it—will see that there is a destiny for the good teachers still in our rural areas.
I should like to pay a tribute to both the television services—the BBC and the ITA—for the excellent talks they now provide for village schools. Modern methods and equipment mean that in schools which have television children now have an opportunity to see and hear experts in all areas of human knowledge.
Finally, what does the village school mean to a community? It is the focal point of many social events. Today the best types of teachers can be found in these schools, with the help of television, and I hope that Ministers of Education will encourage more peripatetic teachers to these areas. I have looked at the clock; I have spoken for five minutes, and that is enough to say for one day.
6.31 p.m.
Lord Gibson-Watt: My Lords, it is very suitable that the noble Lord, Lord John-Mackie, should have initiated this debate because he is both a practical farmer and a former agriculture Minister. Also, he was the chairman of the Forestry Commission under whom I had the pleasure to serve. Indeed, I still serve on the Forestry Commission and was so glad to hear my noble friend Lord Radnor refer to his late father, because there was nobody who was kinder or who encouraged me more as a young man to pursue forestry.
I am not going to speak much about forestry today, partly because I happen to live in an area where there is the highest density of sheep in the United Kingdom and the lowest density of people. I shall direct my remarks to the problems of those who live in the hill and marginal areas. What I have to say is no doubt applicable to many parts of the United Kingdom, but I can speak only from my own practical experience of having lived the whole of my life in the middle of Wales.
In a world where people travel endlessly and change their homes frequently it is a fact that the people I am talking about—partly because they work pretty hard—remain in their homes with their families far longer than most. Of course, some Scotsmen come south of the Border, as we have heard from the noble Lord, Lord John-Mackie, and, I hope, make a good deal of money. But in general the Welsh marginal farmer to whom I am referring is inclined to stay put.
Despite the support of both Governments, there has been a steady drain of the population from these areas, to which reference has been made. Families are smaller and farms are bigger, and most of the farms produce cattle and sheep only. Cereal growing has virtually ceased and, beyond the occasional field of rape, the scene is grass, grass, grass.
Unlike those in other areas, hill farmers cannot suddenly switch to another product, such as oil seed rape, lucerne or maize. The poverty of the soil and the climate in hill and marginal areas makes this impossible. The present fear is, as has been touched on already, that we are likely to suffer the knock-on-effect from the problems of the lowlands, which will come to

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affect the livestock industry in the areas I am talking about.
We have today the largest sheep industry in Western Europe and we know that the French and others are anxious to overtake us. However, the Government are well aware of this. The problem, as I see it, is much more deep-seated than some people appreciate. Many people are inclined to say that conservation grants will be the alternative. I should like people who think in that way to consider the implications for a moment. Conservation and amenity grants cannot easily be administered and applied, except in a capital way; in an income way it is much more difficult.
Certainly the hills will continue to provide relaxation to the general public; SSSIs and ANOBs and management agreements will continue to be accepted as necessary safeguards for our heritage. But support for cattle and sheep in these areas, in my view, has to remain in some form if families are to stay to work the land and to keep the beauty of the areas to which I am referring.
I cannot say that conservation grants will ever be a big enough alternative, though I may be wrong. I must admit that the Countryside Commission grants for the planting of small woods administered through local councils have been very successful, as have those administered by the Forestry Commission.
The Minister of Agriculture has had a hard task, and most thinking farmers recognise his problems, particularly over the CAP. He has a practical knowledge of farming himself and he knows the hill areas, as indeed do Welsh Office Ministers. The Minister has done particularly well in Brussels over the extension of the less favoured areas to include marginal land. One can take the Welsh situation. In Wales now 977,000 acres have been added to the less favoured areas, making a total of 80 per cent. of land in Wales becoming "less favoured".
The ministry kindly provided me with a copy of the consultation paper it has just issued on the implementation of the new EEC structures regulation. In many ways it is encouraging. I draw attention to paragraph 21 and ask my noble friend to stress the importance of giving grants not just for making stone walls but also for mending them. In my experience I have had refusals about mending stone walls. It is very hard work mending them and very expensive. Possibly the Minister could examine this aspect.
There are very few farmers or foresters who fail to recognise the importance of amenity and conservation. I agree with noble Lords who said that we have come a long way in this respect over the past few years. The beauty that exists there has been created very largely by those who live in those areas.
The integration of farming and forestry in Wales is improving, but we still have a long way to go. Our tradition of forestry is not as old as that in Scotland, but with a rainfall of 50 to 70 inches a year one achieves prodigious growth in the case of conifers. As for broadleaves, that is another matter and we shall undoubtedly hear a good deal more about that subject in future debate. I only want to say that anybody who plants an oak tree is himself, or his son or possibly his
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grandson, unlikely to see the result. It is a very expensive hobby.
A speech on Welsh hill areas must include a reference to common land. It is a touchy subject, but a subject on which one would hope for all-party agreement before we ever get to legislation. The ghost of the Duke of Sutherland is perhaps in this House as much as it is on the common land. In Wales we have 500,000 acres—far more than the rest of the United Kingdom—and 447,000 of those acres have grazing rights attached to them. I commend the Common Land Forum recently set up by the Countryside Commission with representation from other bodies. I hope that eventually each common will be considered individually for its particular characteristic—be it farming, forestry, tourism, public access, or a combination of them all. I say to your Lordships that one rule for all commons in this country would be doomed to failure. Above all, I hope for the goodwill that will come from all-party agreement.
I conclude by saying that in a grossly overpopulated country—and this is a grossly overpopulated country—with all the problems of our teeming cities, any Government must and should sustain the hill and marginal areas, for it is to the hills that so many of our urban dwellers come to recharge their batteries. For our part, we say that there is a welcome in the hillside and a welcome in the vale.
6.40 p.m.
Lord Vinson: My Lords, noble Lords will, I hope, forgive me for rising to my feet so quickly after my maiden speech, and I must declare my special interest in being chairman of the Development Commission, England's rural development agency, the parent body of CoSIRA. It is not, of course, in that capacity that I speak but as someone who shares with the noble Lord, Lord John-Mackie, a deep concern for those who live in the countryside and a desire to do something about it. I am only sorry that an inescapable long-standing engagement may prevent me from attending the whole debate, but at the rate we are proceeding I may be all right.
Other noble Lords have pointed out that the problems of the countryside are not diminishing; indeed, they are exacerbated by the unprecedented achievement of the agricultural industry in making this country virtually self-sufficient in food. But the natural consequence of this success will mean a lowering of food prices in order to bring supply and demand into balance. This will be good for the consumer but another blow for the rural economy and for those who work in it. We are, then, talking about people and in what ways the Government can help them.
I do not think it is proper for any Government to try to reverse fundamental economic trends, and it would be foolish to attempt to do so. But what Government can do is temper change by softening its cutting edge. So, where change does cause serious problems, Government should help alleviate the hardships that fall on individuals and communities.
The Motion comes at a very appropriate time when the Government are under pressure to rethink their rural policies and the effect these are likely to have on

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rural communities. Farming, forestry, tourism and conservation all depend on the maintenance of rural communities, and these communities, in turn, depend on the rural economy. So, if agricultural subsidies are reduced, it would seem sensible to continue to channel at least a part of that resource into the rural economy, but by other means. Support for conservation measures alone is not likely to be enough; nor would support that is geared to agriculture or conservation necessarily go to the areas of greatest social and economic need, so the encouragement of other non-farming industries will be crucial.
How, then, can we help establish self-sustaining, viable, alternative forms of employment? If one looks round the countryside and asks where the existing jobs came from, they have more often than not come about as a result of the enterprise and endeavour of local people. It is then important that policies should be framed to encourage this indigenous enterprise; all the more so when the chances of attracting the appropriate foot-loose businesses from outside rural areas are slim due to the competing attractions of urban development incentives.
I agree with the noble Earl, Lord Onslow, that rural areas have one particular asset to offer; and that is, in an increasingly urban-dominated and over-populated world, they can be extremely pleasant places in which to live and work. It is, after all, a combination of these two values that makes life fulfilling. Rural areas are also very suitable for modern high-technology, high added value industry; and it is a happy coincidence that communications technology now makes it possible to conduct such businesses from deep in the countryside. But I agree that the danger is that we may destroy the very things that make the countryside what it is. So it is right that the planning authorities should be cautious in their attitudes and only encourage job-creating opportunities where these are on a scale that is harmonious with the countryside and, above all, in balance with the size of the communities that live there.
The noble Lord, Lord Walston, has so well illustrated that such a policy fits well with the concept of encouraging the conversion of redundant buildings to other economic uses. Such buildings can play a very valuable role in being the birthplace of the indigenous enterprises, often based on the indigenous products, which will provide the employment of tomorrow, be it fish farming or fish canning. It cannot be said too often that Governments do not provide jobs; jobs come through supplying and making things that people want to buy.
However, I should like to draw attention to one major social deprivation that is often overlooked. It is one that is an inescapable and not often recognised fact of country life; namely, the high cost of travel. There is a substantial extra cost to the rural dweller, not only in reaching essential services like schools and hospitals but in simply going to see the doctor and even reaching the more everyday necessities town-dwellers take for granted, like shopping or getting a haircut. There never has been much public transport in rural areas, and round trips of 100 miles or more by car, for example, to visit a relation in hospital are commonplace and are a real burden on the lower paid.
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What are needed are policies which are framed to recognise the remoteness of many rural dwellers and which seek to maintain and even improve the services available to them—services which are on hand for the rest of the community. We need to apply rural solutions to rural problems, and there are already many examples of how this can be activated. So I hope that any reduction of those subsidies that have hitherto flowed into rural areas via agriculture will provide an opportunity for re-directing Government aid to both stimulate alternative forms of employment and assist rural services—the two together. Schools, houses and public transport all need to be treated differently in rural areas, and the fact that a minority of the population live there is beside the point. We can, I believe, all agree that rural deprivation is no more pleasant just because it comes thatched. I hope this message can be borne very much in mind by those framing policy.
6.47 p.m.
Lord Sandford: My Lords, I should like to thank the noble Lord, Lord John-Mackie, for this Motion which refers to four facets of rural life—farming, forestry, the environment, and industry. But over the past 40 years there has been only one overriding policy for the use of land in the rural areas and that is agriculture; farming—farming, relieved of rates, unrestricted by planning, supported by subsidy, selling into a managed market, supervised by its own single-minded Ministry, untouched by any of the other changes in the machinery of Government that have swept through Whitehall in those past 40 years. That policy has been that there should be the maximum production of food from our own resources; and a very good policy it has been. There is nothing wrong with it at all. It has stood us, and is standing us, in very good stead. It is certainly not to be abandoned now just because a number of commodities have gone into surplus.
However, I suggest that the time has come to harness this great engine, with its huge momentum, to other purposes besides farming, as my noble friend Lord Vinson has just said. And it is necessary to check the harm that has been done as this monster has gone on its way; the harm it has done, though inadvertently, by shedding labour, as the noble Lord, Lord John-Mackie, explained by reference to his own career; the harm it has done in damaging the environment—I entirely agree that that aspect should not be exaggerated, but nor can it be ignored—and the harm it has done in standing in the way of other profitable and productive activities and uses of rural land, of which growing timber is one which has already been mentioned by more than one noble Lord.
More important than restrictive policies of that kind are the policies which would harness this great agricultural engine to other purposes, equally or even more profitable to farmers, good for the whole rural economy, enhancing to the environment and more beneficial to the citizens at large; citizens who now have enough to eat, look to the countryside for food, but also for more than food. As has been said in another place, "man does not live by bread alone".
So I agree with the thrust of this Motion but I think it is an illusion, despite what my noble friend Lord

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Onslow said, to try to give effect to the Motion, as the Motion suggests, by formulating a single policy—a single charter, a single White Paper—such as some of the countryside chairmen have been suggesting in The Times, though not my noble friend Lord Vinson.
If it was a good idea to have a single rural policy, it would certainly require very firm application of structure plans and development control over agriculture and forestry to give effect to it. Yet following the upland debate, no less a person than Sir Derek Barber, with all his experience in agriculture, has recommended such planning control over farming and forestry, at least in the hills. However, I certainly do not, and for three reasons.
First, the glory of rural Britain is its diversity. No single plan or set of plans could ever do it justice or get the best from it. I was very glad to hear from my noble friend Lord Gibson-Watt the point that he was making about the management of commons. Whatever the Common Land Forum might come up with, it will never come up with a model for application to all commons. Each one will have to be handled separately. The Dartmoor Commons Bill going into Committee here on 10th June is an example of that. No single plan or policy could ever get the best out of the land in the way that its occupiers and owners do now. The second reason why I do not want to see anything like planning control over farming and forestry is that we have close to hand better, tried and far more sophisticated ways of guiding the changes in the countryside. The third reason is that, in my view, it has become more important to regenerate the rural economies than it is either to grow yet more food or to give yet more care to conservation, though both those policies must of course continue to be pursued.
With the speech that we have just heard from my noble friend Lord Vinson, I do not need to say very much more about regenerating the local economy, but I am glad that he mentioned the importance of rural enterprise agencies and trusts. The most useful way forward, and the one that I think we all want most to see, is by way of profitable policies worked out by local people to develop their own indigenous resources in their own particular way.
In that connection, I think that the Ministry of Agriculture has useful powers which I should like to see it using more—and perhaps my noble friend can comment on that—in giving advice to farmers on how to diversify and in carrying out their duty to give advice to rural agencies on how to combine their roles to that same end. I think that there is tremendous scope for diversification by farmers into other enterprises besides their standard one of growing food. We have heard about the possibility of more woodlands on farms; of processing and marketing, as mentioned by my noble friend Lady Elliot, adding value at the farm; of farm gate sales and "pick your own"; of farm tourism, which the noble Viscount Lord Hampden, mentioned; and of field sports and recreation of every sort.
It makes me sad to hear so much talk of merely reducing inputs and outputs. That is no doubt necessary if one is faced with a milk quota, but there are more and wider options than that, I feel sure.
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I should like to end with a final word on conservation. This summer we have to consider three consultation papers all bearing on that. There is the consultation paper issued this week on the new structures directive, which my noble friend will no doubt be talking about; there is another consultation paper issued the previous week about the extension of the Landscape Area Special Development Order to all the national parks, and I would hope beyond them; and there is the consultation paper about which we were given an undertaking in this House during the passage of the Town and Country Planning (Compensation) Bill. All those bear on the system of prior notification by farmers to the planners of their development proposals. That system is the one that has succeeded prior approval and is much to be desired as compared with development control. It has now been tested for four and a half years in the national parks and the time has come for its extension beyond them.
The purpose for which it was introduced was in order to make the national park authorities aware and able to give advice and guidance to farmers about schemes for which they wanted capital grant. But the most useful purpose which it has in fact served has been to bring farmers and planners in touch with each other over all the farmers' plans and proposals. LASDO is another system of prior notification and is now due for extension into all the national parks. The Association of District Councils will, I feel sure, be recommending that both systems should be extended into other areas besides, notably the areas of outstanding natural beauty, which I assume will correspond quite closely to the "environmentally sensitive areas" of the new structures directive.
I hope that we shall see these innovations taking effect in the course of the next few years. In addition to providing an appropriately mild measure of guidance over farming and forestry, the main benefit of it is that it will bring more farmers and more planners into a constructive relationship. I believe that that will stand the countryside in good stead at the outset of the next 40 years—an era, I hope, of much more diverse activity on the farm.
6.56 p.m.
Lord Parry: My Lords, clearly I owe the House an apology. I put my name down on the list of speakers after it had been drawn up. In addition, I am speaking with half a voice—a handicap for an Englishman but a tragedy for a Welshman. I was right, however, to put down my name because I feared when I saw the Motion that it would lead to an imbalance, and there has been, despite the excellence of the debate—and I express my gratitude to my noble friend Lord John-Mackie for putting down the Motion—an imbalance in what has emerged and what has been said by so many noble Lords speaking from their own expertise. They have totally underestimated and under-stated the revolution that is already taking place and the reconstruction that is already happening in the rural economy of Great Britain.
The references to tourism ranged from the gentle fears of the noble Earl, Lord Radnor, who talked about the leisure industry viewing the agriculturists as running around in smocks, to the tacit admission from

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the noble Lord, Lord Walston, that there was room for the services in the regeneration of the economy of the rural areas. But a service-based evolution has been taking place for the past 25 years in the rural economy. It has been led by tourism. I shall not anticipate the debate which I have learned since I sat in the Chamber that I am able to generate on the 21st or 22nd May on a Motion standing in my name on the Order Paper. But the importance of tourism and what it is doing for the regeneration of the rural economy should be understood and should be underlined in a debate of this importance.
We have talked about sheep in mid-Wales. The population of Wales is 2,780,000 people. Its sheep population is some 6 million. The number of summer visitors in a good year exceeds 12 million, and, increasingly, those visitors are coming throughout the year. For 25 years now, with increasing vigour, they have been pouring into the economy of England, Wales, Scotland and Ireland money which equals the total revenue from offshore oil. We are talking about an investment in the economy of Great Britain greater than the revenues from offshore oil. The revenues from tourism circulate almost totally within the economy where they are generated. It is so good for the economy that I find it amazing that no speaker in this debate has promoted it, and so it has fallen to me to do that.
It has fallen to me to do that because over the past seven years I have had the pleasure of working in one statutory body—the Wales Tourist Board. I no longer have to plead the rules because I am now freed from the obligation to do so. But it was the most rewarding period of my life. For the first time I saw evidence that the rot in and the drift from the rural areas of Wales was being held. There is hard evidence that the drift from the farmlands—the lands that many noble Lords and their families before them have served with distinction—is being halted and perhaps even reversed.
We talk about services and the presence of various facilities, including schools, in the rural areas. In many places there would be no services—there would be no petrol station, there would be no cinema and there would be no road or bus service—if it were not for the fact that the tourists make it essential, and they pay the bill for it.
What I want to say in this debate is this. There are good things to be said by both sides of the House. One of the joys of this story is that both sides of the House can claim credit, because through the tourism industry there has been a continued and sustained investment of public funds essential to the development of all the things about which noble Lords have been talking. But, more importantly, the small amount of money given by the public authorities for investment in tourism has generated a ratio far higher than that in any other industry.
I am grateful to those noble Lords who have in passing mentioned tourism as being basic to the economy. I am sure that in a further debate specifically on tourism many more noble Lords will have good things to say. However, I want to say this. The leisure industry is as vital to the rural areas of Britain as the farming industry is, and it is a part of it. It is vital to
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conservation and preservation, and is funding them. These days it works with the grain of the community, realising that if rural tourists kill the rural areas, or if the wrong emphases take the value off the culture and the language, then we are killing not only the culture but the goose that lays the golden egg that will fund that culture in the future. I thank your Lordships for hearing me.
7.2 p.m.
Lord Mackie of Benshie: My Lords, I am sorry that the noble Lord, Lord Parry, was not in full voice. I hate to think what he would have done if he had been. However, he mentioned a vital area on which I was going to touch. For part of this debate, I should like to go back to originals. The noble Earl, Lord Onslow, was the first speaker to raise this. I am referring to the fact that the revolution in the production of food in the Western world and in certain parts of the developing world is quite astonishing. We now can grow the food we need on a very much smaller area than previously. The NFU has recognised this and the Government have recognised it. All the political parties are now producing papers on what we are going to do with the land and what we are going to do in the new situation. This new situation was quite obvious to Sub-Committee D of the EC scrutiny committee seven or eight years ago, but apparently was missed by practically everybody else in the countryside. We have come to a position where we really cannot stop the surpluses without some price disaster.
Thus here we are. We are in the farming industry. I cannot help identifying myself with it. My noble kinsman, who started this debate, and I are unmistakably of the land. We are farmers. We have to start with that. It must remain the basis of rural life because, as far as one can see ahead, there can be no environment without agriculture. Overall, without it you really cannot preserve things like some of the beautiful Cotswold villages, which today look more like museum pieces than part of rural life. They are indeed beautiful, but when you go through them they do not exactly give the picture of a thrusting, happy, live community.
The Government are now in the position of regarding agriculture as a mistress they have discarded or are discarding, or as a wife they are divorcing, and they want to keep the alimony down. I was very grateful to the Minister for drawing my attention to the discussion paper on the EC and Government grants. I note that in it they say that hedges, dry stone walls and other traditional field boundaries, heather regeneration, shelter belts—apparently everything except grubbing out hedges—will be grant-aided in the interests of the environment. I think this is right and proper. However, they also say in the consultation paper that everything paid out will have to come off something else and that no more money will be available.
I think that the need for the countryside as a live, good place is so great that the Government will have to shell out a little more than they intend. The hills and the uplands will be very hard hit because of the large expenses and the fact that the customers down the country may or may not be willing to pay so much for stock. At the present moment there is no sign of it

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from the sales that I have seen. I like to buy stock a little cheaper than it is going at the present. It is a difficult area. It is an area which, if one is going to keep people there, will require support.
I should now like to turn to the countryside as a holiday place, as a place for a holiday home. The noble Lord, Lord Parry, was quite right to point to the enormous income which we receive from tourism. However, I think I should point out something that he already knows; that is, that most of that money goes to London, Edinburgh and other places. Not nearly enough of it goes into the countryside. I have a good deal of experience of my old constituency, Caithness and Sutherland. A very large number of people who came there came back again and again, not only because it was a beautiful area with lovely hills and wide horizons which were attractive to people but also because they felt they could take part in the rural life. They were welcome on the crofts and on the farms. It was not a conventional holiday area, and because of that they enjoyed it much more than they would have enjoyed a holiday area.
We need to have more holiday homes in the countryside. In Norway they are of the most enormous help, because people extend them, people build them and they maintain the local population in all kinds of ways—both the schools and the local tradesmen. I am sure it would help the troubles in Wales if more planning permission were given for holiday homes in areas where there has been life before. Certainly anyone who has a holiday home in the country will know that the children want to come back and they want to live in the country. They often come to love their holiday home a great deal more than the home in which they live in the city or the suburbs. Thus I think that in that area we must look again at planning. More permission must be given for holiday homes.
Everyone is saying that we must have industry in the countryside. I know a little about this because I have taken part in the building up of industries, some successful and one or two unsuccessful (though I do not want to be reminded of them). I was for more than 20 years chairman of Caithness Glass, which has devoloped quite well in the country areas. One of the things that was against us was the simple matter of communication. Communication is vitally important. If we had not by chance had a good aerodrome at Wick we could not have operated. However, there was an aerodrome left over from wartime and that communication, although expensive, was extremely useful.
I think that a number of noble Lords have mentioned this matter. We are now in an era of communication and development which might well reverse the process of manufacture in factories in large groups. The other day I had an example through the post of British Telecom trying to sell a facility called Facts. The fact about it—and that is not meant to be a pun—is that for £2,000 you can buy a machine which will print through to all the connected machines in the countryside. In 30 seconds it will print a blueprint all over the world. That is the kind of communication which should make it possible for an individual craftsman to live in the countryside and receive orders of a highly technical nature to send back straightaway to his customers.
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Again, the new revolution in communications should enable us to have on a computer, in respect of some of the services we now have, a simple punch-in facility which will give the names of the nearest craftsman, the nearest printer, or whoever it may be. Anyone in the country would be able to punch-in to find out where there was someone to carry out his requirements. We, in farming, are frequently told by the Consumers Association and other consumer bodies how terrible we are if we put up the price of food. In fact, food price increases are much more the responsibility of our highly lauded retail and wholesale systems than they are due to the basic price paid to the farmer. I am certain that home preparation of really good food to be distributed by post, if postal rates are reasonable, could enable a range of developments, which have been discussed in this House, which would enable people to add value to their basic produce.
In the development of rural industries we have to be absolutely certain that government bodies such as the Council for Small Industries in Rural Areas, the Highlands and Islands Development Board and others do things that are successful. The Highlands and Islands Development Board has nearly 20 years' experience. It should have a fair knowlege of what is needed to build a successful rural industry. The same is true, probably to a larger and wider degree, of the Council for Small Industries in Rural Areas. This knowledge should be collated. We should be examining what exactly makes success.
My time has elapsed, but there is still some time in hand. I shall therefore steal another minute to say that the cause advocated in the debate brought forward in so timely a manner by my noble kinsman is one that cannot be done on the cheap. It will need a great deal of research. It will need a lot of support. It will not be enough for the Government to say that they simply cannot spend any more money. They will need to spend some more money. It will not be a handout. The fabric of communication, of transport and of all the services—education and everything else—in the rural areas must be maintained; otherwise, we shall never have the live, rural environment that all of us want to see.
7.12 p.m.
Lord Gallacher: My Lords, this debate has covered a wide area, as inevitably it had to do, having regard to the breadth of the subject matter included in the Motion. All of us are indebted, as already stated, to my noble friend Lord John-Mackie not merely for putting down the Motion but also for introducing it in the manner that he did. In our determination to find a suitable policy for rural areas, we must not forget those who live in urban areas. For them, the rural enivironment is important if only because, in so many instances, the urban environment is something to get away from. Those of us who have lived and worked in towns all our lives are disappointed that after so many years of prosperity the approach by train, for example, to many of our towns and cities can still be a depressing experience in spite of the importance of town and country planning legislation. Indeed, planning consent can sometimes be construed as a licence to do what one likes after one has got it.

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The problem, as we see it, is the reconciliation of the needs of those who live and work in rural areas and those who wish to enjoy leisure in the countryside. Much of what has been stated in this afternoon's debate has indicated that although there are problems in that reconciliation, considerable progress has been made, and is being made, for which we should be grateful and which should be placed on record. I believe that farmers in general have not been too successful in the art of public relations in explaining to the community at large what they have been doing and are doing. As a result, in recent months, they have taken a fair amount of stick, much of it not particularly justified.
We are at the point of decision regarding the future of agriculture. It is important to say loud and clear that the nation should accept that the depression of farming success is unlikely to improve the rural environment. Although reference has been made to the inter-war years, those of us who remember those years know that in many instances the countryside was a fairly sorry place at that time. If farmers are successful and profitable, reasonable demands can be made upon them on environmental grounds. If they are depressed, the environment is likely to be an early and perhaps almost total casualty.
I do not believe that on a Motion of this kind we can discuss at any length the whole question without some reference to the common agricultural policy. Since we joined the European Community, the CAP—still in effect the Community itself—has been at the heart of the agricultural issue. The system of guarantee prices and of buying into intervention was not the basis on which the United Kingdom conducted its farm policy prior to our joining the Community. Yet, strangely enough, there is little apparent support in the United Kingdom at present for any return to deficiency payments or even any propaganda for a return to such payments in the negotiations taking place in Brussels, except, that is, for the variable premia for beef and sheep meat which, I am glad to say, the Minister of Agriculture obtained in Brussels and continues to ask for on an on-going annual basis.
Apart from prices, the success of the common agricultural policy for farmers has reduced the farm labour force. There has been reference in statistical terms to the effect of this in regard to the depopulation of the countryside. Another aspect, not touched upon, has been the effect of farming success and prosperity on land prices. One must also mention the effect of country planning legislation on land prices for housing and other developments even where these are permitted in the countryside. In certain parts of England, particularly the South-East, the ratio of the plot to the house has now put even a modest house well beyond the means of all but the wealthiest people. However important wealthy people are to the countryside, one cannot see a rural environment being built around fairly expensive houses, sometimes bought at considerable cost, simply because there was a house standing there virtually reconstructed and thus obviating the problems of planning consent.
In considering the future of the rural environment, we need to ask ourselves seriously whether town and country planning, and in particular country planning,
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needs to be eased so far as limited development in rural areas is concerned. If, however, in our consideration of the future of the CAP we follow the advice, already mentioned by the noble Lord, Lord Mackie of Benshie, from Sub-Committee D of your Lordships' Select Committee on the European Communities, of reducing production on a five-year rolling programme, using the price mechanism as the means, we have to ask ourselves whether that policy, even if accepted, is really practicable across the board for farming.
If, as a result of such policies, small farmers are forced out of farming or their scale of farming is reduced to such an extent that it becomes uneconomic for them, driving them into the arms of the social and regional funds of the European Community—even though the amount taken from those funds may be available and may be administered nationally and sensibly—it may not prove, at the end of the day, as great a policy as we imagine, even though, on the face of it, it seems a logical and reasonable development, given the nature of the surpluses. For that reason I do not believe that we should rule out of consideration entirely the question of quotas, particularly on commodities suitable for them, even though we have had the unhappy experience of milk quotas which were, I agree, arbitrarily imposed and which have created untold difficulties for the dairy farming industry in this country. It is a measure of dairy farmers' resilience that they have coped as well as they have with something which was sprung upon them in a manner which I do not think was at all appropriate and which clearly shows that Brussels still does not understand the cyclical nature of farming and the long-term planning which necessarily goes into it.
Lower prices could have the paradoxical effect of stimulating output, particularly by those larger farmers who are in a position to stimulate output. For that reason, too, I do not think that we should—out of hand at least—reject the quota concept.
To turn to the idea of low input, which has been advocated, particularly by environmentalists, if that means low output there is no price relief in prospect for consumers as a result of such policies. Although my good friend the noble Lord, Lord Mackie of Benshie, not unexpectedly accused wholesalers and retailers of making inordinate profits at the expense of the farmer, it is a fact that in the present economic climate no one would wish to see food prices arbitrarily increased to consumers, particularly those who are unemployed or low paid.
Lord Mackie of Benshie: My Lords, I did not accuse the wholesalers and retailers of making inordinate profits; I accused them of having inordinate costs.
Lord Gallacher: My Lords, I am grateful for that explanation, and I can assure the noble Lord that what he said has been taken down and may be used in evidence against him in another place. Therefore, I think that the review of the common agricultural policy, which is now in prospect and which Sub-Committee D has in hand as part of the decisions taken in relation to this year's Price Review, which has not yet been completed, is a considerably important review and one which I hope in due course will come

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before your Lordships' House. If it does so, I hope—indeed I know—that it will be debated seriously because of the importance of the document.
I have said that in my opinion if there is to be a reduction in farming as an activity, I should prefer the easement to take place by way of planning consents to allow limited housing and other development in rural areas. To some extent this may solve the problem of depopulation and indeed ease the problem of compensation for farmers who are obliged, as a result of changes in the common agricultural policy, to reduce production. In this connection I hope that the Minister of Agriculture will have serious discussions with his colleagues at the Department of the Environment about the whole question of country planning regulations.
Reference has been made to the problems of living in the countryside, and particularly to school closures. I endorse all that was said by my noble friend Lord Davies of Leek on that subject. The rural school is not merely a place for innovation; in many instances it is also at the centre of village life, particularly where it serves in lieu of the village hall or as well as the village hall. The bus services are of vital importance to rural areas. Although we must not anticipate pain to come, it is a fact that a Bill is proceeding through another place, and I understand that there is serious concern about the impact on bus services of the measures proposed in that Bill.
There is the question of shop closures, which undoubtedly has been aggravated by the development of supermarkets in rural areas and on edge-of-town sites. There is the loss of the sub-post offices. I always think it is a great shame that the community which should be served by sub-post offices is losing them simply because those who control their destiny are laying down targets for them which can be met only by reducing their number and by doing so at a time of considerable unemployment; whereas in point of fact, apart from the convenience for users, the employment opportunities which post office work offers are being lost quite arbitrarily.
Then there are the petrol stations where the oil companies, in pursuit of through-put, are drastically reducing their number in countryside areas. The same goes for tied houses and public houses owned by the breweries where through-put is considered vital to their profitable operation.
In conclusion, I have one suggestion to make in this regard. To some extent community co-operatives might be seriously considered by the Minister of Agriculture as a possible way in which to encourage the vitality of community life in rural areas. This suggestion has the added merit, which I am sure will appeal to the noble Lord the Minister who is to reply to the discussion, that it does not call upon the Government to expend any money whatever, but merely calls upon them to make better use of the facilities which are already available.
I would envisage community co-operatives using the excellent model rules which have recently been produced for community co-operatives by the Cooperative Development Agency. Having obtained the model rules, that body should bring them into effect and breathe life into them by way of experimental
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developments in selected areas. Here I would suggest that the co-operative development division of the Food from Britain Organisation, formerly the Central Council for Agricultural and Horticultural Cooperation, has a vast range of experience in setting up co-operative societies—admittedly mainly marketing societies, large and small—over a wide range of functions. It understands co-operative societies intimately, and I feel certain that, given the resources that it already has which are provided by the Ministry of Agriculture, in suitable areas it could try the experiment. The great thing about a successful cooperative is that its success can be imitated in other areas. In this way I can see a bus service, a village shop, a village post office, a village petrol station and perhaps even a village pub all being part and parcel of a single community co-operative exercise, which may lead to considerable vitality so far as the regeneration of rural life is concerned.
We have had an excellent discussion. We are obliged to my noble friend Lord John-Mackie for introducing the debate and I look forward to hearing the Minister's reply to it.
7.26 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Lord Belstead): My Lords, I am grateful to the noble Lord, Lord John-Mackie, for giving us the opportunity to debate the important and wide-ranging subject of rural policy. At the beginning of his speech my noble friend Lord Onslow made the point that the problem of surpluses is the problem of success. I do not think it is altogether surprising that people point out these days that the surpluses, which we all know exist in so many commodities, and the high cost of the common agricultural policy are evidence that the policy needs to be changed.
The Government have been arguing for a reduction in the cost of this common agricultural policy for some years. However, let us not overlook the achievements of European agriculture, and British agriculture in particular. We no longer have to worry about shortages of food; that is not true in many parts of the world today. Our balance of payments has benefited enormously from our greater degree of self-sufficiency; that has not always been the case. The cost of food to consumers has actually fallen by about 5 per cent. in real terms over the last 10 years. All this has been achieved with reduced farm-gate prices, which have gone down by about 25 per cent. in real terms in the last decade.
The noble Lord, Lord Gallacher, who has just dealt very interestingly with a whole variety of points, said that farmers have perhaps been too silent about what they have achieved. What I have just referred to are major achievements of British agriculture, but at the same time the Government are working for changes which we believe are desirable for the industry and for the rural economy in general.
Recently agriculture ministers of the Community agreed a new structures regulation which will form the basis of our capital grant arrangements for several years to come. Some of your Lordships have mentioned the consultation document which the Ministry of Agriculture sent out last week to a very

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wide range of interested organisations. I do not want to prejudge the outcome of the consultations on that document, but I can say that we have clearly stated in it that the support measures for farm improvement should be implemented in ways which will maintain the rural economy, especially in the uplands, and which are sympathetic to the environment. The attainment of these objectives will, I believe, be helped in forthcoming years because small farmers, under the new structures regulation, will benefit in particular from the less restrictive eligibility conditions of the new arrangements which have been worked out in Europe.
An essential feature of any rural policy is support for the hills. Since 1975 in this country we have operated Community measures directed at ensuring the continuation of agriculture in the less favoured areas. I believe that the LFA grants have been highly successful in ensuring the continuation of many businesses in the areas designated in the United Kingdom as being less favoured.
Then, of course, last year my right honourable friend the Minister of Agriculture achieved a notable success in securing agreement to a large extension of our less favoured areas. This was something that my noble friend Lord Gibson-Watt mentioned. In expressing my thanks to my noble friend for what he said I should like to make the point that of course a significant differential so far as capital grants are concerned exists between the less favoured areas and the lowlands, and I should like to assure him and my noble friend Lady Elliot of Harwood that we intend to retain the valuable system of hill livestock compensatory allowances for the hills. If I may say so, I can think of no better way of demonstrating our determination to protect the future of remote rural areas.
We have also announced our intention to provide grants for farm tourism and craft industries in the less favoured areas. I agree with those of your Lordships who have said in this debate that there is obviously potential still for farmers to diversify their businesses. I should like to say to my noble friend Lord Sandford that the Ministry of Agriculture's advisory service, ADAS, will of course be available to advise on this. Indeed, the report which was presented last September by the Director of ADAS specifically recommended that so far as conservation and socio-economic advice are concerned, within available resources additional emphasis should be devoted to those subjects within the advisory services, and in broad terms my right honourable friend accepted that recommendation.
In working away at this I am most anxious to make the point that we realise in the Ministry of Agriculture that we need to keep in close contact with the tourist boards (and how much I enjoyed the speech that the noble Lord, Lord Parry, made, on that particular subject!) and we need to keep in close touch with the Development Commission and CoSIRA. May I, on a general point at this stage, say that I think it is right to recognise that the Development Commission is giving priority assistance through its rural development areas policy to most of the uplands area, and that the Manpower Services Commission has committed £2¼million to upland areas through the Community
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programme since that programme was started in October 1982.
Lord Sandford: My Lords, may I interrupt my noble friend before he moves on, as I think we have time? That, of course, is welcome news, but my noble friend would have to agree, would he not, that the power to assist in these ways has been in the directive for the last ten years? It would have been much more helpful if the Ministry of Agriculture had made use of it a good many years earlier than this.
Lord Mackie of Benshie: My Lords, would the noble Lord comment at the same time on the value of the assistance to the hill ewe and the hill cow? Has the value in real terms not gone down greatly in the last ten years?
Lord Belstead: My Lords, these are two separate points. May I first answer my noble friend Lord Sandford? The reason why the Ministry of Agriculture did not make use of the article in the European structures directive over the last five to ten years—
Lord Sandford: Ten years.
Lord Belstead:—ten years so far as farm tourism and craft industries are concerned—is that it had to be part of an improvement plan, and it was not as easy as it is going to be now to get an improvement plan if you were a farmer. The other important point is that the maximum investment which could be aided was £9,000 and the maximum investment which can be aided now is £25,000. A third point, which is persuasive and to which I think I am right in remembering the House of Commons Select Committee on the Environment drew attention, is that the English Tourist Authority, having given grants for this form of diversification so far as farms are concerned, have withdrawn that particular form of grant aid, and we therefore think that this is the right moment to embark on giving those forms of grant.
The noble Lord, Lord Mackie of Benshie, asked me about the help under hill livestock compensatory allowances for both cattle and sheep. The noble Lord asked me whether the help had not gone down in real terms. May I say two things so far as this is concerned? It is the case that we look annually—all Governments do—at the hill livestock compensatory allowances to see whether there is a need for them to be increased. Sometimes the HLCAs are increased and sometimes they are not. This coming autumn will be the time for yet another review.
As to whether or not the value of the allowances has kept pace with inflation, that is a matter for argument, and I do not have the detailed figures with me here. But this I would say: there is absolutely no question at all, borne out by the statistics, that if it was not for the LFA policy, which both the previous Government and the present Government have been putting into effect, there are many businesses in the hills which would have been in danger of going out of business. I should like to repeat the assurance that I gave just now to my noble friend Lady Elliot that it is the firm intention of my right honourable friend, particularly since he has managed to extend the LFA concept to extra areas, to maintain these grants in the future.

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May I go on to a completely separate point? There is no better demonstration of the Government's readiness to strive for rural harmony than the new structures directive itself, and the environmental measures which my right honourable friend secured within that new directive. The provision I refer to is the one which will allow the Minister of Agriculture to designate environmentally sensitive areas and then to make payments to encourage farming practices which are sympathetic to the environment. The Government will be consulting widely before drawing up proposals for implementation. It is then hoped to seek enabling powers from Parliament at an early opportunity.
Meanwhile, however, a new experimental scheme has already been launched, using powers available to the Countryside Commission, to help safeguard the unique landscape of the Broads grazing marshes, and this scheme is being funded jointly by the Countryside Commission and the Ministry of Agriculture.
The Earl of Onslow: My Lords, I wonder whether my noble friend can help me here? We have under Article 21 something saying "heather regeneration". With heather regeneration in the hills and the uplands, this, presumably, apart from benefiting my noble friend Lord Swinton's grouse, is going to make sure that there is going to be rather less sheep. Is there not going to be a clash between the headage payment system and the grants for heather regeneration? How is that clash going to be sorted out?
Lord Belstead: My Lords, I do not think that there is any clash there, but we must wait to see what the consultation period on the document brings forward by way of views which are given. My noble friend has given his views. Perhaps I may have a look at the Hansard report and see whether I ought to perhaps add something and write to my noble friend on this point.
Like agriculture, forestry is a major land user with over 2 million hectares in productive use. 'We have had a lot of expert advice on this today. The noble Lord, Lord John-Mackie, himself is of course a former chairman of the commission, and my noble friend Lord Gibson-Watt a serving commissioner at the present time. I think probably your Lordships would agree that in Europe we are, comparatively, a poorly afforested country. Government policy is therefore that forestry should continue to expand to provide employment and timber, and that it should remain a prime example of a mixed economy; and an increasing share of expansion, though by no means all, should be undertaken by the private sector with the help of grants from the Forestry Commission.
My noble friend Lord Radnor specifically asked me again about the way grants have moved compared with the rate of inflation. If my noble friend will forgive me, I will say simply that forestry grants are being reviewed at the present time.
My noble friend went on in his speech to make the point that he felt that the commission had been what he called a weak seller in the market. I am very anxious here to make the point that the market is recovering, I believe, and recovering fast from the mill closures and the setbacks that there were in 1980. There is little surplus timber about and exports are dropping off as
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the home market improves. There are some local problems, but the overall picture is an encouraging one. The Government are exceedingly pleased that it is encouraging, because both the commission and the private growers are contributing to the timber market.
Perhaps I may now turn to the subject which really all your Lordships have spoken about in a most interesting way; that is, the question of industry diversification, because of course this Motion of the noble Lord's draws attention to the needs of industry in rural areas. If I may say so, I think that there is very little need for me to add to my noble friend Lord Vinson's eloquent exposition of the Development Commission's work, except to acknowledge the valuable contribution it has made in maintaining the vitality of rural areas. The point I should like to reiterate is that the commission deals not only with economic issues but also with the social problems facing rural areas, such as housing, services and transport, about which so many of your Lordships spoke eloquently, including the noble Lords, Lord John-Mackie, Lord Walston, my noble friend Lord Onslow, the noble Viscount, Lord Hampden, who told us a rather sorry story about some of his exploits in this particular field, and my noble friend Lord Sandford.
There is just one thing I should like to say about this in passing. I say no more about it because I felt that as chairman of the Development Commission my noble friend Lord Vinson perhaps said as much as should be said at the present time. I know he was exceedingly sorry that he was not able to stay until the end of the debate today. My noble friend drew attention to the high costs that exist so far as rural transport is concerned. Some of your Lordships, including the noble Lord, Lord Walston, and the noble Lord, Lord Gallacher, mentioned the fact that the Government Transport Bill will be coming to your Lordships' House soon. There is one point I should like to make on this—and no doubt we shall be pursuing it at very considerable length in the coming months. It is that it is my hope and belief on behalf of the Government that the Transport Bill, so far as bus services in rural areas are concerned, will lower fares by increasing competition. This is something to which we can return, and I am sure will return, at some length.
I come to environmental matters. There is great interest in this. Scarcely a week passes without media comment on the dangers, real or imaginary, to the countryside. I think this concern is healthy, but I should like to join with the noble Lord, Lord John-Mackie, in deprecating the tendency to play up the idea of conflict, to portray the countryside as being a sort of battleground between conservation and agriculture—though the noble Lord did not put it in quite those dramatic terms—and to suggest that crisis measures are needed. Of course, we have to take care, and we have to take very seriously any criticisms, but I genuinely believe that the Government's record has been a good one. I also believe that the contribution of farmers to conservation should not be understated. In turn, the Government have a duty to ensure that their countryside policies strike the right balance. I very strongly agree with the noble Lord, Lord Gallacher, that a prosperous agriculture is necessary for the right environmental policies.

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In recent months there has been a series of significant developments in our policies to try to get that balance absolutely right. Last September the report on ADAS by the Director General recommended that within available resources increased priority should be given to advisory effort on conservation, and, as I have said, in broad terms my right honourable friend accepted that recommendation. In December changes to the Ministry's farm capital grant schemes were announced, which built on earlier ones in tilting the emphasis of the schemes further in favour of environmentally sympathetic agricultural operations. As I have said, we have just issued the consultation paper inviting comments on new farm capital grant arrangements which give some additional emphasis to grants for environmental purposes.
Finally, last month we initiated from the Ministry of Agriculture a survey of environmental topics on farms. There is a serious intent here. I very much hope that this survey will provide both reliable and up-to-date information on what changes are actually taking place in the countryside, and indeed a comprehensive view of farmers' attitudes towards conservation, because armed with this information we will be in a better position to pursue balanced and effective countryside policies in the future.
Perhaps in the time available I may quickly answer one or two questions. My noble friend Lord Radnor asked about Government policy on fish farming. Fish farming is currently grant-aided under the AHDS—the European Community Schemes only. A decision on grant eligibility in future will depend partly on the outcome of results of consultation on the policy document which we have been talking about today.
The Earl of Radnor: My Lords, will my noble friend give way for a moment? The question I really asked was whether the Government contemplated any future legislation on fish farms polluting rivers, or extraction of water from rivers in relation, obviously, to the growth of fish farms over the country, and employment and so on. It was not on the grant question.
Lord Belstead: My Lords, I am sorry, but on that particular subject I have no news for my noble friend today. I know it is an important subject, but I have no statement that I can make today on behalf of the Government on that particular issue.
My noble friend Lord Gibson-Watt put a point which I have heard on not a few occasions when visiting parts of the uplands concerning the necessity to mend walls as well as to build them. I have to say to my noble friend that under the terms of the Community regulation on grants we are not permitted to pay on maintenance, but we do already pay grants for reconditioning or restoring stone walls as well as building new ones. If my noble friend would like to discern the difference between those two, perhaps he will use his customary acumen in finding where the right answer exactly lies. The fact of the matter is that if you can get the grants, the existing rates are 60 per cent. in the LFAs and 30 per cent. in the lowlands.
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My noble friend Lord Sandford particularly mentioned the questions of prior notification and the landscape area special development order. My noble friend said that the Association of District Councils was making the case that prior notification should be extended to areas of outstanding natural beauty. I believe that the prior notification arrangements for national parks really have worked well. There have been very few applications for grant in the national parks using the prior notification arrangements which in fact have been disagreed. What we have to consider with care is whether an extension of these arrangements is really necessary and would be cost effective and make the best use of available resources. What the arrangements do is to make a demand on manpower. But what is certain is that we are intending, because we have gone out to consultation on it, to extend the landscape area special development order concept to all national parks.
The Countryside Commission's report on the uplands drew attention to the need for new measures to help safeguard national park landscapes and we believe that LASDO provides a flexible and effective mechanism for achieving this without imposing upon farmers and foresters the full burden of the planning machine. As my noble friend knows, it will enable the national parks authorities to influence the siting and design of farms and forest roads and buildings in those parts of the parks where they consider it appropriate, but it will be limited by the need to avoid substantially detracting from the GDO permission to develop. The authorities will also be able, if they choose, to offer compensation in appropriate circumstances for additional expenditure incurred in meeting any conditions they require.
I recall that my noble friend Lord Onslow called for a White Paper. Clearly agriculture is now going through a period of change. The House of Commons Select Committee on the Environment recommended a White Paper and the Government expect to reply to the Select Committee's report in the near future. But if I cannot say any more about this today, I shall express the hope that your Lordships feel that I have endeavoured, in response to the call from my noble friend, to set out the Government's policies for the countryside as a whole.
Lord John-Mackie: My Lords, it is left to me to wind up. I could comment on many things, but I think that is completely unnecessary. What has delighted me about this debate is that it has been conducted in what I might call an atmosphere of consensus from all sides. I simply want to thank all noble Lords who have taken part for their contributions and to thank the Minister for his. I hope that he will be able to carry out not the promises but the statements he has made, and with that I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

"Building Societies: A New Framework"
7.52 p.m.
The Earl of Kinnoull The Earl of Kinnoull rose to ask Her Majesty's Government what has been the response to their Green Paper Building Societies: A New Framework Cmnd.9316).
The noble Earl said: In rising to move this short debate on the Government's Green Paper on building societies and their future framework published 10 months ago, I should like to thank in anticipation those noble Lords who have gamely indicated that they intend to take part, as I shall not have a chance later to thank them.
The timing of this debate at a relatively late hour after two heavy days on the Local Government Bill and after these two fascinating debates this afternoon was not my first choice, but, with the heavy programme for the rest of the summer, I suppose one should count one's blessings. I hope the debate will allow the Government to advise us about what reactions they have received during the consultation period which was completed by the end of November, as well as giving those of us interested in this subject a chance to add a view. There is no shortage of experience among Members of the House, but I see tonight from the list of speakers that it is a matter of quality rather than quantity of speakers.
At this stage I should like to declare an interest in that I am privileged to be involved in a society that is 35th in size in the movement. I am tempted to describe all its attributes, but I shall not because it might encourage others to advertise that they belong to the Woolwich or some other society, which I think might be counter-productive. I speak in a personal capacity.
Building societies are surely one of the most remarkable components of our financial system. From early days 150 years ago, when a few friends gathered in a coffee shop to pool their savings to form a mutual society to provide mortgages for members in a strict rotation, they have grown to the present stage when the largest societies are the custodians of billions of pounds of personal savings and need and require the most sophisticated equipment to operate efficiently. The whole scene is a remarkable picture of success. It is a movement which has achieved the most influence on home ownership and which provides the most trusted haven of personal savings, a movement that defies and has defied for years all normal banking rules about lending long and borrowing short. It is a movement which, unlike its equivalent in America—one thinks particularly of the recent Ohio situation—has never faltered in public confidence nor lost an investor one halfpenny of his investments since the last war, despite three society failures.
That is a proud record. To see the movement's progress, one only has to look back 25 years to 1960, when the total assets were £3 billion, whereas today they are over £100 billion. In 1960 the borrowers were 2 million; today they are 6 million. Home ownership has increased from 42 per cent. to 63 per cent. today. The only shrinkage has been in the number of societies operating, from 481 down to today's roughly 200. No doubt, with rationalisation and mergers and the new powers under review, the increasing pressure will be for further rationalisation. I hope that we shall never sink to the level of the clearing bank numbers. I believe in the value of the small society alongside the giants. It would be a sad loss if they were forced to disappear due to the competition.
To the simple question: do the building societies need modern powers to operate in or a new framework as the Green Paper suggests? I think the answer is unequivocally, "yes". Many of the old existing powers were drafted, surprisingly enough, 112 years ago. They must have had wonderful draftsmen in those days. They were updated in 1962. We are now in a period of financial deregulation in a fiercely competitive market where banks and building societies are on much more of an equal footing, where the old cosy building society cartel has disappeared. The current restrictive legislation clearly frustrates the innovative qualities of societies and the role they could play. The Green Paper sets all that out very clearly.
In any discussion as to what role building societies should be allowed to play in the future—acting as a quasi-bank, offering overdrafts, offering services as estate agents, lawyers, insurance brokers or even insurance companies, developers and landowners—the obvious worry that springs to mind with the experience of the savings and loans associations in the United States is, what effect would this have on public confidence? Would the public lose the vision the societies offer, that of a haven for hard earned savings?
It is encouraging that from the foreword of the Green Paper submitted by my noble friend's right honourable friend the Chancellor of the Exchequer, one reads:
"Our purpose is to ensure that the building societies continue primarily in their traditional roles—holding people's savings securely and lending for house purchase—while loosening the legal restraints under which they have operated for a century or more so that they can develop in other fields".
The suggestion in the Green Paper that 90 per cent. of building societies' funds should remain exclusively channelled towards the mortgage loan for the owner-occupier under what are deemed Class 1 assets is reassuring.
I believe that great credit should go to the Building Societies Association for the support it has given the Government, the movement and the consumer in helping to assist the Government in reaching some of the conclusions reached in the Green Paper. I hope that the Government have taken on board the association's worry about defining the category of Class 1 when it comes to legislation. It would not cover, as I understand it at present, the situation where an owner is living abroad and wants to buy a home over here for retirement, or for the clergy living in tied accommodation for retirement or any other person living in tied accommodation. It would not cover shops with living accommodation either. I hope that my noble friend will consider that carefully and perhaps comment later on that care will be taken not to make the Class 1 too rigid.
The remaining 10 per cent. of the funds either in Class 2 assets—that is, the fully-secured loans—or Class 3 assets—the unsecured loans—obviously give societies the chance to be innovative and to compete in the market. Of course, one knows that only 25 per cent. of societies will qualify for this, due to their size. I am sure that it will be very frustrating for the smaller societies and I think that other noble Lords may pick this up later on. Nevertheless, it is a judgment which the Government and the chief registrar will take. I suspect that it is a correct

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prudential judgment; that you have to be a certain size to operate in the risk area.
Class 2 and Class 3 offer a number of important areas of operation which societies have been denied before. To me, the most important one is land ownership. It has been quite obvious, I think, for the last 20 years, that societies, if allowed to do so, could play a much more supportive role in the housing industry than they currently do. Areas which have been under discussion literally for years have been the urban renewal schemes, partnerships with local authorities, partnerships with private developers, promoting co-ownership housing societies or providing a valuable element to the rented sector as a landlord on a cost basis. Societies have seemingly suffered for years for the sins of the collapse of the Liberator Building Society in the 1870s and the State Building Society in the 1960s over the question of the ownership of land. Both societies failed for a single reason; that massive loans were offered to a highly-geared property company which collapsed like a pack of cards. I am glad that these skeletons have been abandoned by the Government and I welcome their intention to allow societies to make an effective contribution in this field. Under the "New Functions" section of the Green Paper, which proposes to allow societies a number of other areas of operation, I think it is obvious that cheque guarantee cards and small overdrafts are an essential element now in the competitive financial world where the societies meet with banks. I hope that that will be brought about in legislation. It is interesting to note that the external cash machines which are already in use with a number of the very large societies are proving very popular.
My Lords, the integrated housing service, incorporating estate agents, valuation and structural surveys and so on, offers, I believe, a minefield of conflict of interests. It is interesting to note that Lloyds Bank some years ago dipped into estate agency. No other bank has followed and I am not at all sure that Lloyds Bank's experience has been wholly successful. Insurance broking, on the other hand, and subsidiary insurance companies, I personally see as very much related to a society's work and should not offer such conflict. Of course, if I were an insurance broker, perhaps I should take another view. On the wholesale funds, the Green Paper suggests that the prudential limit should rise from the current limit of, I think, 5 per cent. to 20 per cent. This appears to be a big jump, but I must say that I personally feel that it is far too cautious.
Wholesale funds today are a relatively new experience for societies but they are clearly here to stay. They make a lot of sense because they are now the crinkles in the inflow of funds from the normal source—that is, the personal savings source—and they therefore can remove the periods of mortgage scarcity. In most cases, wholesale funds are not "hot" money as is the case with large deposits which can be taken away, plucked away, at a moment's notice to the embarrassment of any particular society. They are term money which can be properly planned and replaced without difficulty. I hope that my noble friend, when considering the framing of legislation, will consider that point.
The Green Paper refers to the EC and invites comments on whether the British societies should operate in Europe. I know that the noble Lord, Lord Ezra, with his special experience, is to comment on this and I shall look forward to what he has to say. Perhaps I may say that my own view is that, as we are in Europe it would seem fairly illogical not to allow societies to operate if they so wish. I hope that my noble friend can touch on that later on this evening.
In all these changes suggested in the Green Paper, there is a very special and heavy responsibility that falls on the chief registrar. His prudential guidelines, his advice to societies, his monitoring of societies, will be quite crucial, particularly in the early period. I expect that his staff numbers will go up, understandably. I understand from the Green Paper that societies will have to meet all his costs and I hope that my noble friend can give an indication of what could be the likely charges. I notice that in the Green Paper there is no appeals procedure should the registrar come into conflict with a particular society over what operation they may or may not go into. I think that with this new era of widening powers, there would be a feeling of some unhappiness if there were no appeals procedure. I suspect that the chief registrar himself would welcome it and I hope that my noble friend will take that into account.
My Lords, finally, I would say that I welcome the Green Paper. It offers, I think, much-needed and refreshing new powers for societies. I hope that tonight my noble friend can give an undertaking that legislation will be introduced in the next Session so that societies can get down to planning their future roles and can meet the competitive yet stimulating challenge and so fulfil their role as successfully as they have in the past.
8.7 p.m.
Lord Ezra: My Lords, the noble Earl, Lord Kinnoull, has raised a question of considerable significance and it is particularly timely as the Green Paper to which he has referred intimates that in due course there will be legislation, legislation which we all hope will recognise (as the noble Earl has emphasised and as the Green Paper itself mentions) the increasingly important role that building societies play in our way of life in this country. Since the early legislation, and even since the legislation of 1962, the societies have grown considerably in size and scope. Therefore, it is important that there should be this legislative review which is contemplated. The noble Earl has dealt with many aspects of their operations which need looking at; and most of those were, in fact, referred to in the Green Paper.
As he was kind enough to say, I should like to look particularly at the potential European aspect of their affairs because in the growth of their operations it seems wrong that they should not be enabled to participate in developments in the European Community. Due, however, to the 1962 legislation, and particularly to Section 1(1) and the reference to lending for freehold and leasehold property, a form of property not known on the continent, they are thereby prohibited from lending on the continent although they can of course raise money there. The position, fortunately, is being looked at very carefully at the

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present time. The Green Paper itself in July when it was issued had a short paragraph on the subject, somewhat qualified, I may say, which was followed up in the response from the Building Societies Association in October by a much more positive view of the situation in which they gave the various reasons why they felt that they should be enabled to operate within the European Community. The reasons they gave I think are very valid. First of all, the whole objective of the Community is to provide free movement—free movement of goods, of services and of people; and there are people moving around. There are many people from this country who, for various business and other reasons, are living in other countries in the European Community and they would like to use the facilities with which they are familiar in this country for raising money for homes they wish to purchase.
On the other hand, there are many citizens of other Community countries who come here and obviously, living here, they would not unnaturally like to take advantage of some of the financial facilities which the building societies offer. Generally speaking and particularly if they are here for business or other reasons or are associated with the Community itself, they may only be here for a limited period and naturally they would like to feel that the benefits they can derive by raising loans from building societies can continue to apply when they return to their home countries.
Furthermore, a major factor, I think, is that there is a growing diversity of financial facilities available, and other financial institutions are able to take advantage of these opportunities; but, so far, the building societies are not. Therefore, it does appear that this is a matter which ought very seriously to be taken into account in the proposed legislation, and I hope that when the noble Lord the Minister replies he will be able to reassure us on that point.
There is indeed quite a lot of development in this particular field. Not only is there the reference made in the Green Paper and the response of the building societies, but since these two documents appeared there has been the publication of a draft directive by the European Commission in January and February of this year, which has set out the basis on which the Commission considers that cross-frontier mortgage facilities can be facilitated within the Community. They have, very rightly and very wisely, kept away from harmonisation. Harmonisation is a rock on which many good ideas have foundered. To try to get harmonisation of many disparate arrangements, particularly in the financial field, is a virtually impossible task within any measurable time. Instead, they have proposed that all the existing arrangements should be freely available, subject to suitable safeguards.
Of course, the extension of British mortgage facilities on the continent of Europe does raise a number of questions. These have been dealt with, I believe satisfactorily, by the Building Societies Association. There is the question of the exchange risk. This can be overcome by making sure that the books are balanced in each country in which they operate and that in fact the money is raised in the
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country in order to lend it in that country. It would be quite wrong in fact for the British saver to feel that his money was being put at risk by being lent in some other country and when it was recovered in one form or another it could suffer because of exchange variation. So this could be overcome. There is also the question of supervision, but again that can be overcome, in my opinion, by combining the British requirements and the requirements of the host country, as indeed is proposed in the draft directive.
Therefore it seems to me that there is a clear need for the building societies, like other financial organisations, to be provided with this extension to their operations. It is after all a major objective of British Government policy within the European Community to create a real internal market; and so far this market has faltered somewhat, particularly in regard to services and financial facilities. This would be one way of securing an extension.
The effect of enabling such building societies as wish to extend their operations into the European Community as a whole would be to offer a wide choice of mortgage credit instruments to customers throughout the Community, including Britain; and I must say, on behalf of the building societies, that they have not flinched at the prospect of having other facilities offered over here. They are in a competitive mood. I believe they need to be encouraged and stimulated in that direction.
I should like to conclude by saying that I hope the legislation which the Government have in mind will take this whole question fully into account. In fact it is being looked at at this very moment by Sub-Committee A of the European Communities Committee. It has been looking at this question of cross-frontier mortgage credit and will, I believe, within the next month or two be producing its report. I hope the committee will be coming out with some positive conclusions. The effect of this extension would have two major benefits, to my mind. It would help to create a real internal market, especially so far as financial services are concerned within the European Community, and it could add quite substantially as the years go by to Britain's invisible earnings.
8.16 p.m.
Lord Houghton of Sowerby: My Lords, from where I have been sitting an observer might have been forgiven for thinking that these proceedings were the Building Societies Association at prayer, because I see so many building society people around. I am one myself. The noble Earl who asked the Question is the chairman of a building society of which I am a member. I will not mention its name in case I am accused of parading a commercial. The noble Earl, Lord Selkirk, was chairman of the Building Societies Association for 14 years; and a very trying period of office he had. The noble Lord who has just left, I noticed, was also a director of a building society. That probably increases the respect that we are going to have for the subject under discussion, though I am bound to say that although I have been a member of a building society all my life I have never prayed for one, and I have mostly been a dissenter—because there are things to disagree with in the building society

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movement and I think that at some time or other they will have to be expressed.
There is no doubt, of course, that the building society movement has made an amazing contribution to the progress of home purchase for occupation, but I do not think I noticed that the noble Earl, Lord Kinnoull, and certainly not the Chancellor of the Exchequer in his foreword to the Green Paper, mentioned the tax relief on mortgage interest paid. That is the key to the progress of the building society movement: because they have been able to offer mortgages the interest on which has qualified for tax relief. That goes right back to the beginning of our system of taxation, when the main source of income assessed for tax purposes was income from land; and relief on charges on property was traditional right from the beginning. Mortgage interest payable was one of them.
Tax relief on mortgage interest paid is so important and arouses so much political interest that the moment any political spokesman suggests that there might be a review of the taxation arrangements he is disowned and denounced in no time. This is the Ark of the Covenant: that people should be able to have tax relief on their mortgage interest payments.
When your Lordships come to look at it, house purchase for occupation is the best buy in the property market for a person of moderate means, and it is the best investment in conditions of inflation. I would ask your Lordships just to consider this. A person buying a house through a building society buys an appreciating asset. He pays for it by borrowing money at its current value; he repays it over a period of 20 to 25 years in a depreciating currency; and he pays interest which is subject to the current levels of tax relief, whatever they may be. No wonder that house purchase is popular and no wonder that it is a great boon to those who can take advantage of it! When people talk about a property-owning democracy, what they really mean is a nation of property-owning beneficiaries, because most of the owner-occupied stock of houses in Britain has been purchased on these favourable terms.
I am hoping that the noble Lord the Minister will be able to tell us where the Government have got to on their review of the present position of building societies. This Green Paper came out last July and the Government asked for comments on it, which should all be in by now, and they are probably wondering what next they are going to do. It would be interesting to know whether, so far as the Government have gone, they think that some further White Paper or document for discussion might be issued giving their more final views of the situation. They have asked for comments on a number of matters in this Green Paper, and it would be interesting to know what comments they have received and what conclusions they have reached upon them. That is important.
There are some curious things about building societies' activities that are not generally realised. One is that you would think, to listen to the political palaver, that the only people who matter in this whole outfit are those who are borrowing money. It takes three small investors to provide one mortgage. I have money in three building societies and I could not
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finance one mortgage of average amount at the present time. There are many investors in building societies who are financing other people who are taking out mortgages of very considerable amounts indeed. I mention that because the investor is so frequently overlooked, as if the borrower is the only person who is entitled to political and social interest. The investor is usually a small person and there are some millions of such investors. I think that there are three times as many investors as those who borrow, and that ratio has to be borne in mind.
Another interesting point about building societies is the amount of money that they get in but pay out again. Eighty per cent. of the intake of building societies goes out in the course of a year. It would be very interesting to know who takes out the money. Are the building societies being used as deposit banks because they open on Saturday mornings? To what extent are building societies making a lot of money out of short-term deposits upon which they pay no interest at all?
There are some mysteries about finance, and the building societies are no less mysterious than elsewhere. A banking friend told me recently: "We do not make our money out of deposits. We make our money out of transactions, because we charge for them, and the more people who are putting money in and taking it out, and other people are taking it out and putting it in, the better we like it. We do not want people bringing in large lumps of money and saying `There you are. You can have it for 20 years'. That is no good. Let us get people who will listen to the television news about interest rates, or look at the financial columns of the popular press, and say 'It's about time we got out of this and put our money in that. It does not matter that it has been there for only five minutes. This is a better investment than that'."
This popular pastime of financial transactions needs some independent examination. Money is becoming a growth industry. The handling of other people's money is the biggest industry in Britain today. When we talk about services, what we mean is that there will be more people standing behind counters to take your money and pay it back again. There will be a large nucleus of resources in the hands of the banking institutions, upon which they will be able to gain substantial rewards without paying out in interest anything like them.
I do not want to take up more than another moment or two, because this is not a full-dress debate on building societies; I could promise a much longer speech for that. But I fear that all the talk about reforming building societies may lead to what is the very tag end of public interest; that is, the form which accountability shall take in the building societies. I do not think that this Green Paper gets it right. I hope that we shall not have a repetition of the Trustee Savings Banks Bill, which ignored the interests of depositors and found that the bank did not belong to anybody very much, so anything could be done with it that Parliament wanted.
I hope we shall not get that with building societies; though, of course, they have members and the Halifax could rent the Crystal Palace at any time they liked for a meeting of their shareholders, if they were indignant enough. But they are not indignant enough, because

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they are not organised. The Building Societies Association is organised, the financial institutions are highly organised, but what about the members of building societies? Where is their voice coming from? Any institution that belongs to millions of people does not really belong to anyone, because you cannot concentrate a representative point of view as you have no democratic means of obtaining it. This is the problem.
Those who want a voice in running the affairs of building societies ought to be willing to pay for it. The franchise in building societies can be purchased at far too cheap a price, and the minimum qualification by way of a holding of building society shares should be much higher than it is. The Government propose to make it a £100 investment, which I think is far too low. The Building Societies Association have said that it should be £250, but they are just thinking in round figures. It may be that something higher than that would be justified as a qualification for a shareholder with a vote.
I think, also, that some consideration has to be given to whether we stick to this ultra-democratic basis of one man one vote, no matter how much you have invested in the institution. There is a case for giving (up to certain limits, at any rate) varying degrees of weight in participation related to the amount of assets held in the society. That is something worth considering in order to get people who are members of societies, who will take an interest and who have paid a reasonable amount for the qualification. The only alternative is to begin to have societies of building society investors and members and to try to get some democratic voice in that way. Anyway, that is a note thrown into the line of discussion.
The main difficulty about the functions of building societies is what they want to do in the other fields. What do they want to do? The Chancellor's foreword is almost unexceptionable, except that I regard the words,
"so that they can develop in other fields",
as open to a question mark. It is their traditional role that is the important one. Development in other fields needs careful watching, because, believe me, there is nothing like the ambitions of the financial expert and the tycoon of financial power. He wants a wider area of activity. I do not blame him. He may be able to render better services as a result, but that will depend on what services he proposes to render which need to be given in that particular form and from that particular source.
Question marks remain, but I think that will have to do for a very short debate on an Unstarred Question. I am sure your Lordships would agree that when the time comes we shall have a jolly good time with building societies.
8.30 p.m.
Lord Beaumont of Whitley: My Lords, I, too, should like to thank the noble Earl for having asked his Question tonight and certainly for enabling me to put to the Government a question I want to raise. In addition, this occasion has already provided an extremely interesting debate. I entirely agree with the noble Lord, Lord Ezra, on the points he was making
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about the necessity of expansion and competition within the Common Market. I also agree, perhaps rather more surprisingly, with the remarks of the noble Lord, Lord Houghton of Sowerby, about the necessity to question the sacrosanctity of this cosy welfare state for the middle class made up from the tax relief on mortgages.
The question I want to ask is much more limited. The Green Paper followed on a report by the Building Societies Association on the future powers and constitution of societies which concentrated on extending the powers of those societies. The Green Paper also deals with that subject, but in many ways it would restrict those powers. When the Green Paper was published it included an issue not previously raised by anybody; it substantially proposed to restrict lending to owner-occupied housing.
It is claimed that such lending is the traditional preserve of building societies, but it is in fact a recent tradition. The original societies—about which the noble Earl, Lord Kinnoull, told us something—were exactly what their name suggests. They were small co-operatives of working men who clubbed together to buy land and build houses for their own occupation. After a while money started to be lent to other people to buy property. It seems that there are no records of the types of property involved, but in the late 19th and early 20th centuries there was a very low level of owner-occupation and most property was bought by landlords to rent out. There are ample examples of building societies in those days providing finance for landlords.
As a result of the State Building Society crash in 1959 legislation was introduced to limit the amount a society could lend to property speculators. This was done by producing a highly complicated formula restricting lending either on high-value mortgages or to limited companies. As is often the case—as is only too often the case—with this kind of "fire brigade" legislation, the formula was both complicated and inexact.
Co-operatives registered as friendly societies under the Friendly Societies Act are limited companies, albeit under different legislation from the normal commercial joint stock company, but loans to friendly societies became restricted as if they were property developers. We now have the irony, incidentally, of the Registrar of Friendly Societies supervising building societies and the statutory restrictions on lending to co-operatives, and also supervising the co-operatives, whose development he is, in his building society capacity, restricting.
In 1964 the Housing Act imposed separate and equally complicated restrictions. The Building Societies Association publishes a Guide to Building Society Finance in which it comments that:
"advances to housing societies are socially desirable but here, again, a due sense of proportion should be observed".
I believe this really means to say that building societies pay lip service to housing associations but really do not want too much of it and so try to limit their development by stealth. Judging by the restrictions hedging such lending, clearly governments of various complexions have taken a similar view.

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Turning now to the Green Paper, rather than easing such controls, the proposal is to tighten them. There will be a flat limit of 10 per cent. of lending which can be taken up by, among others, co-operatives and housing associations, plus lending to landlords, on agricultural land, on smallholdings, on shops with flats above, on business premises, on boarding houses, and for a whole host of other purposes for which small businessmen and businesswomen might require finance. This pushes small businesses into the hands of finance companies and other higher interest-charging concerns and makes it less likely that a business will become viable. It is a damper on business enterprise in general and on small businesses in particular, and goes totally contrary to the Government's purported policies in this area.
I am a patron of the small Ecology Building Society. I am not certain what a patron is, but I am one. The society was established to lend money for the promotion of a more ecological use of land and buildings. About 90 per cent. of its lending comes within the restricted category named in the Green Paper. For example, the society recently lent on a house in London in order to provide capital for its owner to build up a business selling recycled paper. The property itself is perfectly sound. The society never lends more than 80 per cent. of market valuation. Had the owner simply wanted to live in that house and draw state benefits, the Green Paper would be very happy and would smile on that proposition. But as the purpose is to promote small-scale industry and the saving of resources, the Green Paper frowns on it. To me that seems ridiculous.
The Green Paper itself permits a certain amount of unsecured lending for consumer goods or anything else the borrower may desire. Quite reasonably, there are restrictions on this type of lending, but I can see no prudential reason for restricting loans secured on property. It is true that the text of the Green Paper contains a remarkable statement at paragraph 3.14:
"Owning land and property is a high risk activity. Some involvement by building societies would be welcome but it needs to be kept within prudent bounds".
Admittedly that was written in the context of property development, but can the Minister responsible really have read that sentence without wincing? May I assume that the Minister has not in fact given proper consideration to some of the contents of the Green Paper?
The style of the restrictions on lending, which would involve much form filling and calculation of percentages by organisations which would do better concentrating on lending money to people, suggests a Civil Service approach rather than a ministerial approach, and a bureacratic approach rather more than the approach that is traditional for the Conservative Party. The style of the restrictions on lending indeed suggests that cast of mind.
Can the noble Lord assure me that Ministers are fully aware of the implications of the Green Paper proposals and that they really have applied to them the philosophy of the Conservative Party? In many respects the limitations appear to be restrictive in a way that Conservatives would not normally wish them to be applied. I should particularly like to ask the
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Minister whether the Government will take another look at this part of the Green Paper and think again before we have legislation thrust upon us.
8.40 p.m.
The Earl of Selkirk: My Lords, I am grateful to my noble friend Lord Kinnoull for raising this Question. I regard this as a general, preliminary discussion of what is quite a considerable subject. Of all the developments which have taken place since the war, none is more impressive than the building societies. They have gathered money—I never quite know why—and they have provided a social service which, in my opinion, is second to none. Unless the people of this country are properly housed, all the rest of the social services are of a minor quality. I therefore think it is of no less importance in what we do next.
The general position, if I may give it in this way, is that after the First World War about 15 per cent. of the people in this country were owner-occupiers. The figure is now over 60 per cent. and the desire for owner-occupation is probably 90 per cent. Nobody has contributed more to that position than the building societies—and without Government expenditure. One may say that there is tax relief on mortgage interest, but it is nevertheless a tremendous achievement which must be recognised.
The Government have put forward proposals for extending the powers of building societies. I think that they are probably correct to do so. At present the building societies have at their disposal about £100 billion and I can think of nothing better than that this money should be used for the reorganisation and improvement of the centres of our cities. There is no greater social service than can be implied by that. The question is: how are we to do it? The Government have agreed on legislation. The first question I put to the Minister is: can he give an undertaking that legislation will be produced next Session? That is what we want. We are only having a preliminary discussion now, but this is a matter of great importance.
I shall mention only one or two points which I think are vitally important. First, I believe that building societies must have the right to own land. That is essential. From that proceeds the possibility of renting property. The greatest problem of our present housing position is the shortage of rented property. Whether one can make special provision to enable people to be able to occupy property, I do not know; but that is the first thing that is required—the power to occupy property.
Secondly—I am not certain whether this applies—I should like to encourage the restoration of "unfortunate" property in the cities. Most of the building societies' work is done in helping people to buy their property, but there is tremendous work to be done. To a great extent it is done by the housing associations. I refer to the restoration of property. The state of the inner sites of many of our greatest cities is a disgrace and the building societies are the main organisations which can improve the position. I hope that the building societies will receive additional powers which will enable them to do essentially the work which they started; started from the ground upwards, not from the top, and have done for over 200 years. Restoration of property is one of the essential

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things where at the moment the societies are not doing quite enough. Many properties could, with advantage, be considerably restored.
I am glad that the Government have emphasised mutuality. Mutuality is very acceptable by both sides of the House. It has disadvantages—perhaps not having the facility which joint stock companies have—but I believe it gives great confidence. To be quite frank, building societies are not greatly inhibited by the element of mutuality, and I can see what it can do.
There is one aspect I want to mention and which the noble Lord, Lord Ezra, referred to; that is, that greater consideration should be given to overseas. People think that we are collecting money in this country and paying it into France. That is complete nonsense. What one would do, and all one would do, is put down seed money to start an organisation, collect the money from overseas and then make them benefit from the organisation which we have. Let us be frank about this. In the field of house building no country has invented a better system than the building society system. There are only a few countries which have it—Australia, New Zealand and South Africa—and they have been very successful. If we can persuade countries in Europe to do the same it will be an enormous advantage. It will not be a debit on our country. As the noble Lord, Lord Ezra, said; it will probably be an invisible export, though I cannot say exactly how it will work out. Our system has been developed with no Government assistance. It is not a Government matter. It has arisen from the soil and I believe that it could be greatly developed.
We have a great opportunity of formulating a new Act of Parliament which will cover this development. I believe it is of the utmost importance. I was particularly interested in what the noble Lord, Lord Houghton, said. He is intensely interesting, and he is very critical of building societies. He makes all his remarks especially interesting because he knows so much about the subject. I hope, first, that the Government will tell us that we will have a Bill; secondly, that they will give an assurance that they will give some consideration to adventures into Europe; and, thirdly, that they will ensure, above all, that building societies can own land which they can develop and thus offer rented property.
8.47 p.m.
Lord Stoddart of Swindon: My Lords, I thank the noble Earl, Lord Kinnoull, for raising this very important and interesting Question. I must say, having heard the debate so far, that I feel a veritable Daniel in a den of building society experts. How I am going to deal with it, I simply do not know. Nevertheless, the discussion has certainly been a very learned one and we have all learnt from each other.
I was particularly interested in the remarks on mortgage interest of my noble friend Lord Houghton of Sowerby. He indulged in a certain amount of criticism of it and rightly said that if anyone dared to raise the matter, it was such a sacred cow that there would be a great outcry. That is true. However, in the light of what he said I have to make it absolutely clear
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that so far as the Labour Party is concerned it believes that tax relief on mortgage interest should be continued; indeed, it will be continued.
Building societies are big business. Their total assets amount to about £86 billion. It is certainly not a declining industry, since in 1984 the building societies attracted more new savings and lent more money than ever before. There are over 25 million savers depositing over £7,000 million a year. The building societies attracted 50 per cent. of all savings in 1983. Indeed, as the noble Earl pointed out, they remain the most popular source of mortgages and they lend well over £11 billion a year. When the high street banks went into the house mortgage market they made no serious impact on the pre-eminent position of the building societies.
Clearly the building societies are not only very important financial institutions performing a vital social role in housing; they are also used and trusted, again as the noble Earl pointed out, by a large proportion of the population. It is true that since the breaking of the cartel they have become more aggressive in competing for the nation's savings. That competition has been heightened since the banks are now making their interest rates more attractive to the individual saver.
The problem is that the savings ratio has fallen dramatically from 12·3 per cent. of income in 1982 to 8·5 per cent. in 1983. Competition from a greater number of institutions for a falling proportion of savings has made that market all the keener.
For lenders that is good news, though the multiplicity of interest rates on offer is becoming quite bewildering, with savers being wooed by an extra 0·2 per cent. here and immediate repayment without loss of interest there. I watch that market myself, as no doubt do all noble Lords and others. For borrowers, on the other hand, the news is not so good. The likely long-term trend under those circumstances is for mortgage interest rates to be rather higher than they would be but for the new competitive era. I think we have to understand that.
It is not of course that I hold building societies responsible for high interest rates per se; I do not. The blame lies fairly and squarely with the Government and their doctrinaire approach to economic and financial management. But clearly the building societies are not content with their traditional role. They want to add to that role by undertaking new services and getting hold of a bigger slice of the financial market.
While we in the Labour Party believe that certain services would be complementary to those already provided by building societies, there are other activities in which they wish to engage about which we have serious reservations, and I must make that clear. There could be little opposition to the building societies providing conveyancing services with proper safeguards for borrowers, nor to an extension of their surveying service, and nor would there be any real objections to societies providing a simple cheque service to their depositors. Undoubtedly such a service is wanted by building society customers and would be convenient both to them and to the societies.

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The question of whether or not estate agency services would be appropriate needs careful thought. There could be a conflict between the competing interests of the buyer and the seller; that could, indeed, arise. Although that might be overcome by hiving off such services and managing them completely independently of mainstream building society activities, one wonders what advantage there would be under such circumstances and how such a service would differ from that given by existing estate agents.
But those are minor, though important, matters. Our reservations arise from the proposals to allow societies to hold a proportion of their assets in unsecured loans, indulging in hire purchase finance, entering into insurance broking and underwriting and the ownership of land and property. Those are our reservations and it is about those things that we are rather worried.
It seems to us that there remains at present plenty for the building societies to do in the promotion of house ownership and the provision of a safe haven for personal savings. If the societies entered into a multiplicity of specialist activities, that could well affect their traditional role to the disadvanage of potential house owners and savers.
For example, the desire of the building societies, or at least the large building societies—because that is what we are talking about—to turn themselves into banks could be dangerous to their stability and could affect the availability of funds for house purchase. They simply do not have, certainly at this present time, the national and international expertise that the high street banks have. They do not have it and it would take them some while to acquire it, even if it were desirable that they should, and we are not at all sure that they should.
For over 10 years the societies have paid out more than they have received. In recent years the gap between income and expenditure has been bridged only by capital gains made on gilt-edged stock. That is how the gap has been bridged. That is not likely to continue, bearing in mind the new tax arrangements for the sale of gilts. The warning from the Chief Registrar of Friendly Societies that that situation cannot be allowed to continue should be heeded. Their venturing into the unsecured loans business and hire purchase finance is not likely to improve the situation. It would be tragic indeed if we saw at some future time building societies involved in a secondary banking crisis such as that which occurred in 1974. That would do great harm to the building society movement and to the building societies themselves.
It seems to us that insufficient thought has been given to the long-term consequences of building societies becoming banks and the implications for the continuing availability of adequate mortgage finance for home ownership.
The Earl of Kinnoull: My Lords, the noble Lord is of course aware that unsecured loans represent only 5 per cent. of the total, as set out in the Green Paper. He is painting a black picture, as if building societies will be irresponsible. But he appreciates that it is only 5 per cent., which is a very small amount.
Lord Stoddart of Swindon: Yes, indeed, my Lords. It was not my intention to paint a black picture. It was my intention to present the other side of the coin, and I think it is right that it should be put. Of course I understand that initially only a small proportion of the total would be involved in unsecured finance. But of course that proportion can and would be altered, as suggested in the Green Paper, by a simple statutory instrument and not by a Bill. Therefore that proportion could easily be put up. That is a danger which should be guarded against and about which we should have discussion when a Bill comes forward. But I understand the position as it is expressed in the Green Paper.
With regard to insurance brokerage and underwriting, the societies will again be entering a new and specialised world where large losses can accrue on certain types of insurance. We have quite recently seen that some underwriters have had their fingers burnt. Losses on fire insurance—an area on which presumably the building societies would wish to concentrate—have been reported. One is bound to ask what benefits are likely to accrue to borrowers and depositors from such activities and who would bear the cost of any losses should they occur. At this point in time the insurance business is risky, and I am not at all sure that it would be wise for the building societies to turn their hands to that.
I now turn to the question of ownership by building societies of land and property. I have to say first of all that I am almost touched—not quite, but almost by the Government's desire expressed in the Green Paper that the building societies should enter into the rented sector of housing. Bearing in mind that over the past six years the Government have been positively discouraging, indeed preventing, local authorities from building rented houses for general use, and have substantially reduced the stock of houses in the rented sector through the right-to-buy legislation, they really do have a nerve to come along now and shed crocodile tears about the desirability of the building societies to dabble with rented housing. The Minister must have had his tongue in his cheek when he directed that that section be written.
However, I do not want to be too critical of the Government this evening. On the credit side, the Green Paper points out the risky nature of such operations and the dangers involved in building societies becoming too closely involved with developers and property. The Government say, quite rightly, that some involvement by building societies would be welcome, but it needs to be kept within prudent bounds. We would say "Amen" to that.
There is a way in which the Labour Party believes building societies could safely enter the rented sector. It is through partnership with local authorities, many of which still own housing land which they cannot develop, due to Government restrictions on finance. Such arrangements would be beneficial to the building societies and the local authorities as well as to balanced housing provision. Of course the same or similar arrangements could be made with housing associations and the building societies could very well do a great deal in the promotion of co-operative housing.

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Finally, I am concerned about the effects of the Green Paper proposals on the small building societies. By small I mean those societies classified in groups D, E and F by the Registrar of Friendly Societies and which account for 148 of the total number of 207 building societies. In other words, 75 per cent. of the total are in the smaller range.
These small societies have assets ranging from £2,675 million to a mere £7 million, compared with the Halifax's £16,782 million and the Abbey National's £14,312 million. It seems to me that the Green Paper is a charter for the big societies and one which will allow them to reorientate their operations towards money making, as mentioned by my noble friend Lord Houghton of Sowerby, partly perhaps at the expense of their social role in housing.
The Times, the Financial Times and the Economist have all run articles expressing the view that the minnows of the Building Societies Association would be unable to operate within such conditions through lack of muscle in the new fields of competition, and it is likely that they will be elbowed aside or swallowed up by the big boys. That has been the comment in responsible newspapers so far.
Thus, yet again the Government seem to be encouraging huge, monopolistic, centralised, bureaucratic structures within the building society movement which can only lead to a less personalised and inferior service to lenders and borrowers alike. In our view it is essential that the small societies should survive and it is imperative that a healthy infrastructure of small societies, with local roots, local loyalties and know-how should be perpetuated. It is encumbent upon the Government to say how they propose to ensure this under their proposals. We simply cannot allow the destruction of the smaller societies, and if this means giving them preferential treatment, particularly in terms of taxation, the Government must find the means of doing so.
While in this short debate it has not been possible to examine in the minutest detail every single facet of the Green Paper proposals, I believe that it has been a useful discussion. We shall all listen to the noble Lord's reply with great interest. We also hope that the real and genuine concerns expressed in your Lordships' House this evening will be taken fully on board by the Government when framing their legislation.
9.5 p.m.
Lord Brabazon of Tara: My Lords, I should like to join with other noble Lords in thanking my noble friend for raising this topic tonight. We have heard some interesting, excellent and very well-informed speeches, which have ranged over many different aspects of the subject. The breadth of the debate shows how building societies now touch many corners of our national life. The Government's proposals for new legislation are not merely of narrow concern to the building society movement only; the issues they raise are of considerable importance to many people in many walks of life.
My noble friend has raised this matter at an opportune time. Some six months have passed since
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the close of the period in which responses to the Green Paper Building Societies: A New Framework were sought. In that time the Government have made good progress in assimilating the views that have been expressed and in working up firm proposals for new legislation. While I am not in a position tonight to deliver final conclusions on that work, it is the Government's intention to make a firm statement in the early summer. The form of this statement has not been settled, but it may be that a full White Paper is unnecessary. However, I can assure my noble friend Lord Kinnoull, my noble friend Lord Selkirk, and the noble Lord, Lord Houghton, that it remains our objective to introduce legislation in the next session of Parliament.
The Green Paper represents one step in a process which has been under way for some time now. As building societies have come to assume a steadily larger place in the financial system and in the high street, so it has become clear that the 19th century legislation governing them is becoming increasingly out of date. This has become clear in several ways.
First, as many noble Lords have pointed out, there is clear evidence that the members of building societies are seeking more than just the traditional service. This is indicated by attitude surveys that have been conducted by the societies and others, and, indeed, by the use that is made of building society investments. For example, gross withdrawals as a proportion of average balances—broadly speaking, a measure of the turnover of money in building society accounts—more than doubled in the 1970s and have continued to increase since. This suggests that people use their building society savings more actively than perhaps they did in the past. The societies have in many cases responded by introducing new services, such as automatic cash dispensers, cheque cards, travellers' cheques, and the like. But they have sometimes had to exercise considerable ingenuity to stay within the confines of the existing legislation. That is a clear signal that it is time to take a fresh look at that legislation.
A second development has been the increasing desire of many larger societies to play a more active role in the provision of new housing, both for sale and for rent. It was only a few years ago that we used to hear allegations about building societies drawing red lines on the map around areas in which, so it was said, they would not lend. I cannot say what foundation there was for those allegations. But it is perhaps significant that we hear no such talk today. In stead, many of the largest societies have gone out of their way to affirm their commitment to extending the growth of home ownership yet further and contributing to the renewal of our inner cities.
Such commitments have been given substance in the willingness of building societies to lend to council tenants buying their own homes, and by the initiatives that some societies have taken in setting up housing associations. The Government have welcomed these developments. But, again, they have sometimes stretched to the limit what is permitted under the existing legislation. Here, too, there is a need to redefine the statutory powers of the societies so as to recognise the role that they are now playing and are capable of playing in the future.

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A further important point is that the building societies form part of a financial sector which is in itself changing fast. As the Government White Paper, Financial Services in the United Kingdom, made clear earlier this year, fundamental changes are under way. The structure of the Stock Exchange is undergoing radical change. New ways of dealing in securities are growing up. New markets have appeared, from financial futures to Euro-bonds. New ways of marketing life assurance and unit trusts have appeared.
These changes are having a considerable impact on financial institutions generally and on their traditional markets. The building societies are inextricably bound up with the changes that have been taking place. We cannot be sure how the financial services market will evolve in the coming years. But we must ensure that the societies have the flexibility to respond.
These, then, are the principal reasons why new legislation is now necessary. But the Green Paper was also quite clear that we are not in the business of change for its own sake. The building society formula of, on the one hand, providing a safe home for small—and not so small—savers and, on the other, providing people with the finance to buy their own homes, has been a highly successful one. The changes proposed by the Government are very much around the edges. The core of building society business will continue to be in these traditional areas.
This will be given effect by the balance sheet limits proposed for the legislation. The most fundamental of these is that at least 90 per cent. of asset business will have to continue to be first mortgages on residential property. My noble friend Lord Kinnoull raised the question of the definition of what the Green Paper referred to as Class 1 assets. These are the means which are to form 90 per cent. of a society's business. I was glad to hear his welcome for that general proposition. In general they are to be loans to owner occupiers, but, as my noble friend pointed out, that concept requires careful definition. A good many representations have been made on this aspect of the Green Paper suggesting, as did my noble friend, that what was proposed was too rigid. The Government are still considering these matters. I cannot tonight anticipate their conclusions, but I can assure him that these representations are being considered most carefully. The other limits—the 5 per cent. limit on higher risk assets, and limiting liquid assets to one-third of the total and wholesale funds to no more than 20 per cent. of total liabilities—are also important.
The concentration on traditional business will have two effects. First, the societies will continue to be primarily providers of mortgage finance. I am sure that that is what noble Lords and others outside this House would wish. Secondly, it will mean that, although some of the new business will inevitably be rather riskier than traditional mortgage lending, it will be confined to a relatively small proportion of total business. Moreover, not all societies will wish to take on the full range of new powers available to them, although the scope will be there for those which so wish. At the same time, the prudential framework operated for the protection of investors by the Chief Registrar of Friendly Societies will be strengthened
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and a statutory investor protection scheme will be introduced. Small savers will continue to be able to put their money into building societies with confidence.
In large measure, the Government's proposals have drawn upon those put out earlier by the Building Societies Association. We make no apology for that. It is clearly sensible that, when considering proposals for deregulation, careful heed should be paid to the aspirations of those affected. In some respect, the Government have not given the societies all that they have asked for. In others, we have gone beyond the BSA proposals and introduced new ideas of our own. But, overall, it is a package that has been widely welcomed in the building society movement.
As I said in my opening remarks, the societies cannot now be considered in isolation. The proposals have considerable implications for those who deal with the societies and may in the future find themselves in direct competition with them. The Government were therefore gratified by the very wide spectrum of organisations and individuals to have responded to the Green Paper. These have included the banking, insurance and construction industries, the legal, accountancy and surveying professions, consumer bodies, trade unions, local authorities, and many more. It would be foolish to pretend that every proposal in the Green Paper has found favour in all quarters. Different people naturally hold different views on what it is appropriate for the societies to be taking on.
Many of the detailed proposals will need to be scrutinised with great care. No doubt they will be discussed with considerable interest—perhaps animation in some cases. I hope that before too long your Lordships' House will have an opportunity to consider them in detail, and I look forward to the much longer speech of the noble Lord, Lord Houghton, at that stage. However, I do not detect great dissent from the proposition that the existing building society legislation is badly in need of an overhaul and that societies as a whole are now capable of taking more upon themselves.
Various noble Lords, notably the noble Lord, Lord Ezra, and my noble friend Lord Selkirk, asked about moving into Europe. As the noble Lord, Lord Ezra, pointed out, the Commission has published a draft directive, and a Select Committee of your Lordships' House is currently considering this important matter. Clearly, the Government will wish to see what the committee has to say before reaching final conclusions. However, in evidence to the committee the Government expressed a general welcome for the proposals. To that extent they have gone beyond the initial comments in the Green Paper.
The Government recognise that we are part of a Community where a common market in financial services is growing. The building societies must not be insulated from that process. While a good deal of further work needs to be done on the details, the Government think that the general approach must be a positive one.
My noble friend Lord Kinnoull asked me two specific questions about the registrars, and whether I can give him an indication of the charges and appeal procedures. I have noted what my noble friend said,

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but I am afraid that at this stage I cannot give him such an indication. The noble Lord, Lord Houghton, suggested that the investors in building societies were being overlooked. I rather thought that the noble Lord, Lord Stoddart, answered that question for me, in that every time one opens a newspaper one sees competing advertising from building societies trying to persuade people to invest.
The noble Lord also mentioned the importance of members of building societies taking an informed interest in their business. The Green Paper suggested the wisdom of looking again at the qualifying shareholdings for voting in elections, and this is still under review. The noble Lord, Lord Beaumont, who I know is associated with the Ecology Building Society, mentioned that subject and the possible widening of the scope of building societies. As I have said, the Green Paper proposes that the primary business of a building society will remain the raising of funds from individual members of a building society for lending on security by mortgage of owner-occupied residential property. In keeping with present practices, 90 per cent. of a society's assets would be loaned on owner-occupied residential property. This has wide support. It is what investors in building societies expect to be done with their money.
Societies will also be permitted to follow a range of related activities, subject to the quantified limits on those involving either the acquisition of assets or incoming liabilities. The noble Lord suggested that my right honourable friend the Chancellor had not given careful consideration to the Green Paper. I can assure the noble Lord that my right honourable friend has, and his endorsement of the Green Paper, as quoted by my noble friend Lord Kinnoull, I should have thought made that quite clear.
The noble Lord, Lord Stoddart, gave us a very interesting exposé of what his party would do in, I hope, the unlikely event of them coming to power. However, I was encouraged that they would continue with mortgage interest relief in, as I say, that unlikely event. I believe that the noble Lord made one mistake which I should like to put right. He suggested that the Green Paper would allow building societies to take part in insurance broking and underwriting. There is no such suggestion in the Green Paper: broking, yes; underwriting, no.
The noble Lord also mentioned the smaller societies. As he is aware, the Green Paper proposes that the assets of building societies should be split into three classes: Class 1, mortgage loans to individual occupiers; Class 2, other forms of secured loan; and Class 3, new types of asset including unsecured loans and equity. We have already discussed the limits to which those classes would be subject. We regard the safety of investors' money as our paramount concern. In considering the range of assets, therefore, the Government have an eye to the management expertise and reserves of a society to enable it to deal with the new business arising from Class 3. Much of this would involve more risk and would therefore need to be covered by a proportionately higher free reserve than hitherto.
Accordingly, the Government proposed in the Green Paper that most Class 3 assets would not be
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open to the very smallest societies. They suggested a threshold for this of societies with free reserves of less than £3 million. The full powers would be available to societies with total assets accounting for over 95 per cent. of those of the movement. However, I would not like the noble Lord to think that we would in any way wish to see the number of societies decline. It is just that we would wish to restrict these extra activities to the large ones.
The building societies are at the threshold of an exciting new stage in their history. While we cannot expect the transition always to be smooth, I am sure that the ultimate effects on the movement will be beneficial and invigorating. We have had an excellent debate tonight and many points have been raised which the Government will wish to consider carefully as final proposals are formed. It has been invaluable to have these views aired in this way at this time. If I have not responded to all the many interesting points which have been raised, no doubt noble Lords will take comfort from the thought that they will soon have ample opportunity for further discussion on them.
Lord Stoddart of Swindon: My Lords, before the noble Lord sits down may I say on the question of underwriting that I do not think I referred specifically to the Green Paper but what the building societies themselves wanted. Indeed, in the proposals from the building societies, at I think (f) in the list, they say:
"Societies should be permitted to underwrite insurance"
Lord Brabazon of Tara: My Lords, I am sorry if I got it wrong, but I thought I was responding to what was in the Green Paper; and the Government, in the Green Paper, would wish to restrict them to broking and not underwriting.

Town and Country Planning (Compensation) Bill
Returned from the Commons with the amendments agreed to.
Industrial Development Bill [H.L.]
Returned from the Commons agreed to with amendments; the amendments ordered to be printed.

Films Bill
Returned from the Commons with the amendment disagreed to with a reason for such disagreement; the reason ordered to be printed.
House adjourned at twenty-one minutes past nine o'clock.